SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 10-K
__ X __ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934.
For the quarterly period ended December 31, 1998
-----------------------
OR
_______ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934.
For the transition period from ____________ to _____________
Commission file number 333-31093-05
------------
PREMIER AUTO TRUST 1998-5
- -----------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
State of Delaware 52-2128242
- -----------------------------------------------------------------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
27777 Franklin Road, Southfield, Michigan 48034
- -----------------------------------------------------------------------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (248) 948-3067
--------------------------
Securities registered pursuant to Section 12(b) of the Act: None
Securities registered pursuant to Section 12(g) of the Act: None
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to
such filing requirements for the past 90 days. Yes _____ No __X__
Indicate by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation S-K is not contained herein, and will not be contained, to
the best of registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K. [X]
<PAGE>
PART I. FINANCIAL INFORMATION
ITEM 1. BUSINESS
The Trust was formed under the laws of Delaware pursuant to an Amended and
Restated Trust Agreement (the "Trust Agreement") dated as of October 1, 1998,
among Premier Receivables L.L.C.("Premier L.L.C."), Chrysler Financial
Company L.L.C. ("CFC"), and Chase Manhattan Bank Delaware, acting thereunder
not in its individual capacity but solely as trustee of the Trust.
On October 23, 1998, the Trust issued $380,000,000 aggregate principal amount
of 5.14% Asset Backed Notes, Class A-1 (the "Class A-1 Notes"), $640,000,000
aggregate principal amount of 5.07% Asset Backed Notes, Class A-2 (the "Class
A-2 Notes"), $450,000,000 aggregate principal amount of 5.07% Asset Backed
Notes, Class A-3 (the "Class A-3 Notes"), and $214,375,000 aggregate
principal amount of 5.19% Asset Backed Notes, Class A-4 (the "Class A-4
Notes" and, together with the Class A-1 Notes, the Class A-2 Notes and the
Class A-3 Notes, the "Notes"). The Notes were issued pursuant to an Indenture
dated as of October 1, 1998, between the Trust and The First National Bank of
Chicago, as Indenture Trustee. The assets of the Trust include a pool of
motor vehicle retail installment sale contracts ("Receivables"), secured by
security interests in the motor vehicles financed thereby and including
certain monies due or received thereunder on or after October 14, 1998,
transferred to the Trust by CFC on October 23, 1998. The Notes are secured by
the assets of the Trust pursuant to the Indenture. The Trust also issued
$65,625,000 aggregate principal amount of Asset Backed Certificates (the
"Certificates" and, together with the Notes, the "Securities"). The
Certificates represent fractional undivided interests in the Trust. The
Certificates were not offered and will initially be held by the servicer,
which may thereafter sell the Certificates. The Certificates will not bear
interest and no principal will be paid until the Notes have been paid in
full.
The Trust has no employees.
ITEM 2. PROPERTIES
There is nothing to report with regard to this item.
ITEM 3. LEGAL PROCEEDINGS
There is nothing to report with regard to this item.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
There is nothing to report with regard to this item.
2
<PAGE>
PART II.
ITEM 5. MARKET FOR REGISTRANT'S COMMOM EQUITY AND RELATED
STOCKHOLDER MATTERS
(1) The effective date of the Securities Act registration statement:
August 1, 1997. The date of the Prospectus Supplement is October 20,
1998.
(2) The offering date: October 20, 1998
(4) The offering did not terminate before any securities were sold.
(i) The offering has terminated and all securities registered were sold
before termination.
(ii) The name(s) of the managing underwriter(s):
Bear, Stearns & Co. Inc.
Merrill Lynch, Pierce, Fenner & Smith Incorporated
Morgan Stanley & Co. Incorporated
Salomon Smith Barney Inc.
(iii) The title of each class of securities registered:
5.07% Asset Backed Notes, Class A-2
5.07% Asset Backed Notes, Class A-3
5.19% Asset Backed Notes, Class A-4
(iv) For each class of securities (other than a class of securities into
which a class of convertible securities registered may be converted
without additional payment to the issuer):
3
<PAGE>
ITEM 5. (CONTINUED)
<TABLE>
<CAPTION>
Aggregate
Price of
Title Offering Aggregate
Of Amount Amount Amount Offering Price of
Security Registered Registered Sold Amount Sold
-------- ---------- ---------- ------ -----------------
<S> <C> <C> <C> <C>
5.07% Asset Backed
Notes,
Class A-2 $ 640,000,000 $ 639,988,480 $ 640,000,000 $ 639,988,480
5.07% Asset Backed
Notes,
Class A-3 $ 450,000,000 $ 449,998,200 $ 450,000,000 $ 449,998,200
5.19% Asset
Backed Notes, Class A-4 $ 214,375,000 $ 214,358,064 $ 214,375,000 $ 214,358,064
-------------- -------------- -------------- --------------
TOTAL $1,304,375,000 $1,304,344,744 $1,304,375,000 $1,304,344,744
============== ============== ============== ==============
</TABLE>
(v) The amount of expenses incurred for the issuer's account in
connection with the issuance and distribution of the securities
registered for the following:
(A) Direct or indirect payments to directors, officers, general partners
of the issuer or their associates; to person owning ten (10) percent
or more of any class of equity securities of the issuer; and to
affiliates of the issuer: None
(B) Direct or indirect payments to others:
(1) Underwriting discounts and commissions: $2,419,687
(2) Finders' Fees: $0
(3) Expenses paid to or for underwriters: $0
(4) Other expenses: $0
(5) Total expenses: $2,419,687
(vi) The net offering proceeds to the issuer after deducting the total
expenses: $1,301,925,057
(vii) The amount of net offering proceeds to the issuer used for
construction of plant, building and facilities; purchase and
installation of machinery and equipment; purchase of real estate;
acquisition of other business(es); repayment of indebtedness;
working capital; temporary investments (which should be specified):
None
Any other purposes for which at least five (5) percent of the
issuer's total offering proceeds or $100,000 has been used:
4
<PAGE>
ITEM 5. (CONTINUED)
(A) Direct or indirect payments to directors, officers, general partners
of the issuer or their associates; to persons owning ten (10)
percent or more of any class of equity securities of the issuer; and
to affiliates of the issuer: None
(B) Direct or indirect payments to others:
The net proceeds from the sale of the securities were applied by the
issuer (i) to the purchase of receivables from Chrysler Financial
Corporation and (ii) to make the initial deposit into the Reserve
Account: $1,301,925,057
(viii) This Item does not represent a material change in the use of
proceeds described in the prospectus.
ITEM 6. SELECTED FINANCIAL DATA
The selected financial data has been omitted since the required information
is included in the financial statements or the notes thereto.
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATION
The Trust was formed under the laws of Delaware pursuant to an Amended and
Restated Trust Agreement dated (the "Trust Agreement") as of October 1, 1998,
among Premier Receivables L.L.C. ("Premier L.L.C."), Chrysler Financial
Company L.L.C. ("CFC"),and Chase Manhattan Bank Delaware, acting thereunder
not in its individual capacity but solely as trustee of the Trust.
On October 23, 1998, the Trust issued $380,000,000 aggregate principal amount
of 5.14% Asset Backed Notes, Class A-1 (the "Class A-1 Notes"), $640,000,000
aggregate principal amount of 5.07% Asset Backed Notes, Class A-2 (the "Class
A-2 Notes"), $450,000,000 aggregate principal amount of 5.07% Asset Backed
Notes, Class A-3 (the "Class A-3 Notes"), and $214,375,000 aggregate
principal amount of 5.19% Asset Backed Notes, Class A-4 (the "Class A-4
Notes" and, together with the Class A-1 Notes, the Class A-2 Notes and the
Class A-3 Notes, the "Notes"). The Notes were issued pursuant to an Indenture
dated as of October 1, 1998, between the Trust and The First National Bank of
Chicago, as Indenture Trustee. The assets of the Trust include a pool of
motor vehicle retail installment sale contracts ("Receivables"), secured by
security interests in the motor vehicles financed thereby and including
certain monies due or received thereunder on or after October 14, 1998,
transferred to the Trust by CFC on October 23, 1998. The Notes are secured by
the assets of the Trust pursuant to the Indenture. The Trust also issued
$65,625,000 aggregate principal amount of Asset Backed Certificates (the
"Certificates" and, together with the Notes, the "Securities"). The
Certificates represent fractional undivided interests in the Trust. The
Certificates were not offered and will initially be held by the servicer,
which may thereafter sell the Certificates. The Certificates will not bear
interest and no principal will be paid until the Notes have been paid in
full.
The Trust has no employees.
5
<PAGE>
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATION (CONTINUED)
Year 2000
The Trust relies on the servicer's computer systems. CFC, as servicer, has
conducted an evaluation of the actions necessary to ensure that its business
critical computer systems will function without disruption with respect to
the application of dating systems in the Year 2000. As a result of this
evaluation, CFC is engaged in the process of upgrading, replacing and testing
certain of its information and other computer systems. CFC's remedial actions
are scheduled to be completed during the third quarter of 1999 and, based
upon information currently available, CFC does not anticipate that the costs
of its remedial actions will be material to the consolidated results of
operations and financial position of CFC and are being expensed as incurred.
However, there can be no assurance that the remedial actions being
implemented by CFC will be completed in time to avoid dating systems problems
or that the cost will not be material to CFC. If CFC is unable to complete its
remedial actions in the planned timeframe, contingency plans will be
developed to address those business critical systems that may not be Year
2000 compliant.
In addition, disruptions with respect to vendor or customer computer systems,
which are outside the control of CFC, could impair the ability of CFC to
obtain necessary services or to provide services to their customers.
Disruptions of CFC's computer systems, or the computer systems of CFC's
vendors or customers, as well as the cost of avoiding such disruption, could
have a material adverse effect upon the financial condition and results of
operations of CFC. CFC has a process in place to assess the Year 2000
readiness of its business critical vendors and customers. CFC believes that
the most likely worst case scenario is that a small number of vendors will be
unable to supply service for a short time after January 1, 2000. As part of
the assessment process, CFC will develop contingency plans for those business
critical vendors who are either unable or unwilling to develop remediation
plans to become Year 2000 compliant. Although these plans have yet to be
developed, CFC expects that these plans will include selective resourcing of
services to Year 2000 compliant vendors. CFC expects that vendors in this
category will represent an insignificant part of its total service base. It
is expected that these plans will be in place by the third quarter of 1999.
Any inability to complete the remedial actions referred to in the preceding
two paragraghs in a timely manner could result in delays in collections on
the Receivables and payments on the Notes.
ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
There is nothing to report with regard to this item.
6
<PAGE>
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
<TABLE>
<CAPTION>
PREMIER AUTO TRUST 1998-5
STATEMENT OF ASSETS, LIABILITIES AND EQUITY
DECEMBER 31, 1998
(in millions of dollars)
ASSETS
<S> <C>
Cash and Cash Equivalents (Note 1) $ 4.4
Receivables (Note 3) 1,654.2
--------
TOTAL ASSETS $1,658.6
========
LIABILITIES AND EQUITY
Amounts Held for Future Distribution (Note 1) $ 7.8
Asset Backed Notes (Notes 3 and 4) 1,650.8
--------
TOTAL LIABILITIES AND EQUITY $1,658.6
========
<FN>
See Notes to Financial Statements.
</TABLE>
7
<PAGE>
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA (CONTINUED)
<TABLE>
<CAPTION>
PREMIER AUTO TRUST 1998-5
STATEMENT OF CASH RECEIPTS AND DISBURSEMENTS
FOR THE PERIOD OCTOBER 1, 1998 (INCEPTION) THROUGH
DECEMBER 31, 1998 (in millions of dollars)
CASH RECEIPTS
<S> <C>
Proceeds from Sale of Notes $1,750.0
Collections of Principal & Interest, and Other 116.5
--------
TOTAL CASH RECEIPTS 1,866.5
--------
CASH DISBURSEMENTS
Purchase of Receivables 1,750.0
Distribution of Principal & Interest, and Other 112.1
--------
TOTAL CASH DISBURSEMENTS 1,862.1
--------
CASH RECEIPTS IN EXCESS OF CASH DISBURSEMENTS $ 4.4
========
<FN>
See Notes to Financial Statements.
</TABLE>
8
<PAGE>
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA - (CONTINUED)
PREMIER AUTO TRUST 1998-5
NOTES TO FINANCIAL STATEMENTS
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of Accounting
The financial statements of Premier Auto Trust 1998-1 (the "Trust") are
prepared on the basis of cash receipts and disbursements, which is a
comprehensive basis of accounting other than generally accepted accounting
principles. The primary difference from the accrual basis to this basis is
that the financial statements do not record accrued interest receivable on
the Receivables or accrued interest payable on the Notes from the most recent
Distribution Date to the balance sheet date.
Cash and Cash Equivalents
Short-term instruments with a maturity of less than three months when
purchased are considered to be cash equivalents. The Trust received certain
cash deposits from Chrysler Financial Corporation ("CFC") which are held as
liquidity and credit enhancement reserves and invested in short-term
instruments. Under the Sale and Servicing Agreement, the servicer is required
to convey principal and interest collections to the Trust within two business
days after their receipt. The Trust invests these collections in short-term
instruments pending distribution. If CFC maintains a short-term rating of at
least A-1 by Standard & Poor's and P-1 by Moody's the servicer may convey the
principal and interest collections to the Trust on a monthly basis. In May
1998, CFC met the rating requirements and the servicer began to convey
collections to the Trust on a monthly basis.
Amounts Held for Future Distribution
Amounts held for future distribution represent certain short-term investments
held for future distributions to Noteholders and for liquidity and credit
enhancement reserves. Amounts held for liquidity and credit enhancement
reserves which are not utilized for future distributions to Noteholders will
be distributed to Premier Receivables L.L.C. ("Premier L.L.C.").
NOTE 2 - RELATED PARTIES
Premier L.L.C. is a limited liability company controlled by CFC. On November
12, 1998, CFC's parent, Chrysler Corporation, became a wholly owned
subsidiary of DaimlerChrysler Aktiengesellscchaft ("Daimler") and on November
17, 1998, Chrysler Corporation changed its name to DaimlerChrysler
Corporation ("DaimlerChrysler").
9
<PAGE>
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA - (CONTINUED)
PREMIER AUTO TRUST 1998-5
NOTES TO FINANCIAL STATEMENTS
NOTE 3 - SALE OF ASSET BACKED NOTES
The Trust was formed under the laws of Delaware pursuant to an Amended and
Restated Trust Agreement dated (the "Trust Agreement") as of October 1, 1998,
among Premier Receivables L.L.C. ("Premier L.L.C."), Chrysler Financial
Company L.L.C. ("CFC"),and Chase Manhattan Bank Delaware, acting thereunder
not in its individual capacity but solely as trustee of the Trust.
On October 23, 1998, the Trust issued $380,000,000 aggregate principal amount
of 5.14% Asset Backed Notes, Class A-1 (the "Class A-1 Notes"), $640,000,000
aggregate principal amount of 5.07% Asset Backed Notes, Class A-2 (the "Class
A-2 Notes"), $450,000,000 aggregate principal amount of 5.07% Asset Backed
Notes, Class A-3 (the "Class A-3 Notes"), and $214,375,000 aggregate
principal amount of 5.19% Asset Backed Notes, Class A-4 (the "Class A-4
Notes" and, together with the Class A-1 Notes, the Class A-2 Notes and the
Class A-3 Notes, the "Notes"). The Notes were issued pursuant to an Indenture
dated as of October 1, 1998, between the Trust and The First National Bank of
Chicago, as Indenture Trustee. The assets of the Trust include a pool of
motor vehicle retail installment sale contracts ("Receivables"), secured by
security interests in the motor vehicles financed thereby and including
certain monies due or received thereunder on or after October 14, 1998,
transferred to the Trust by CFC on October 23, 1998. The Notes are secured by
the assets of the Trust pursuant to the Indenture. The Trust also issued
$65,625,000 aggregate principal amount of Asset Backed Certificates (the
"Certificates" and, together with the Notes, the "Securities"). The
Certificates represent fractional undivided interests in the Trust. The
Certificates were not offered and will initially be held by the servicer,
which may thereafter sell the Certificates. The Certificates will not bear
interest and no principal will be paid until the Notes have been paid in
full.
NOTE 4 - PRINCIPAL AND INTEREST PAYMENTS
Interest on the Notes will accrue at the respective fixed per annum interest
rates specified above. Interest on the Notes will generally be payable on the
eighth day of each month or, if any such day is not a Business Day, on the
next succeeding Business Day (each, a "Distribution Date"), commencing
November 9, 1998. Principal of the Notes will be payable on each Distribution
Date to the extent described in the Prospectus Supplement dated October 20,
1998, and the Prospectus dated September 10, 1997 (collectively, the
"Prospectus"); however, no principal payments will be made (i) on the Class
A-2 Notes until the Class A-1 Notes have been paid in full, (ii) on the Class
A-3 Notes until the Class A-2 Notes have been paid in full, (iii) on the
Class A-4 Notes until the Class A-3 Notes have been paid in full. Each class
of the Notes will be payable in full on the applicable final scheduled
Distribution Date as set forth in the Prospectus. However, payment in full of
a class of Notes could occur earlier than such dates as described in the
Prospectus. In addition, the Class A-4 Notes will be subject to redemption in
whole, but not in part, on any Distribution Date on which the servicer
exercises its option to purchase the Receivables. The servicer may purchase
the Receivables when the aggregate principal balance of the Receivables shall
have declined to 10% or less of the initial aggregate principal balance of
the Receivables purchased by the Trust.
10
<PAGE>
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA - (CONTINUED)
PREMIER AUTO TRUST 1998-5
NOTES TO FINANCIAL STATEMENTS
NOTE 5 - FEDERAL INCOME TAXES
In the opinion of outside legal counsel, for federal income tax purposes, the
Notes will be characterized as debt, and the Trust will not be characterized
as an association (or a publicly traded partnership) taxable as a
corporation.
NOTE 6 - FINANCIAL INSTRUMENTS
The estimated fair value of financial instruments have been determined using
available market information and valuation methodologies as described below.
However, considerable judgment is required in interpreting market data to
develop the estimates of fair value. Accordingly, the estimates presented
herein are not necessarily indicative of the amounts that could be realized
in a current market exchange. The use of different market assumptions or
valuation methodologies may have a material effect on the estimated fair
value amounts.
The carrying amounts and estimated fair values of the Trust's financial
instruments at December 31, 1998 were as follows:
Carrying Fair
Amount Value
-------- -----
(in millions of dollars)
Cash and Cash Equivalents $ 4.4 $ 4.4
Receivables $ 1,654.2 $ 1,665.4
Amounts Held for Future Distribution $ 7.8 $ 35.7
Asset Backed Notes $ 1,650.8 $ 1,634.1
Assumptions and Methodologies
The carrying value of cash and cash equivalents approximates market value due
to the short maturity of these instruments.
The fair value of receivables was estimated by discounting expected cash
flows using rates of loans with similar maturities at December 31, 1998.
The fair value of Asset Backed Notes was estimated using quoted market
prices.
The fair value of Amounts Held for Future Distribution was estimated at
carrying value for amounts with short-term maturities and at net realizable
value for remaining amounts due Premier L.L.C.
11
<PAGE>
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA - (CONTINUED)
PREMIER AUTO TRUST 1998-5
NOTES TO FINANCIAL STATEMENTS
NOTE 7 - RECENT EVENTS
Chrysler Financial Corporation converted from a corporation to a limited
liability company ("LLC") on October 25, 1998. The conversion to an LLC did
not have, and will continue not to have, an effect on day-to-day operations
of the servicer. The new LLC is the surviving legal entity of a merger
between Chrysler Financial Company L.L.C., a newly created Michigan limited
liability company, and Chrysler Financial Corporation. Chrysler Corporation
owned all of the capital stock of Chrysler Financial Corporation.
DaimlerChrysler Corporation (formerly known as Chrysler Corporation) is the
sole member (owner) of Chrysler Financial Company L.L.C. Chrysler Financial
Company L.L.C. succeeded to the operations of Chrysler Financial Corporation
upon the completion of the merger and acquired its assets and assumed debt
and other obligations.
12
<PAGE>
Deloitte &
Touche LLP
- ---------- -------------------------------------------------
Suite 900 Telephone (313) 396-3000
600 Renaissance Center
Detroit, Michigan 48243-1704
INDEPENDENT AUDITORS' REPORT
Shareholder and Board of Directors
Chrysler Financial Company, L.L.C.
Southfield, Michigan
We have audited the accompanying statement of assets, liabilities and equity
arising from cash transactions of the Premier Auto Trust 1998-5 as of
December 31, 1998, and the related statement of cash receipts and
disbursements for the period October 1, 1998 (inception) through December 31,
1998. These financial statements are the responsibility of the management of
Chrysler Financial Company, L.L.C. Our responsibility is to express an
opinion on these financial statements based on our audit.
We conducted our audit in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free
of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements.
An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audit provides a
reasonable basis for our opinion.
As described in Note 1, these financial statements were prepared on the basis
of cash receipts and disbursements, which is a comprehensive basis of
accounting other than generally accepted accounting principles.
In our opinion, such financial statements present fairly, in all material
respects, the assets, liabilities and equity arising from cash transactions
of the Premier Auto Trust 1998-5 as of December 31, 1998, and its cash
receipts and disbursements for the period October 1, 1998 (inception) through
December 31, 1998 on the basis of accounting described in Note 1.
/s/ Deloitte & Touche LLP
January 22, 1999
- -----------------
Deloitte & Touche
Tohmatsu
International
- -----------------
13
<PAGE>
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCCOUNTING
AND FINANCIAL DISCLOSURE
There is nothing to report with regard to this item.
PART III.
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
There is nothing to report with regard to this item.
ITEM 11. EXECUTIVE COMPENSATION
There is nothing to report with regard to this item.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
There is nothing to report with regard to this item.
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
There is nothing to report with regard to this item.
PART IV.
ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K
(a) The following documents are filed as a part of this report:
1. Financial Statements
Financial statements for Premier Auto Trust 1998-5 as follows:
Statement of Assets, Liabilities and Equity - December 31, 1998
(page 7 of this report)
Statement of Cash Receipts and Disbursements for the period October
1, 1998 (inception) through December 31, 1998 (page 8 of this
report)
Notes to Financial Statements (pages 9, 10, 11 and 12 of this
report)
Independent Auditors' Report (page 13 of this report)
2. Financial Statement Schedules
All financial statement schedules have been omitted because the
information to be provided therein is included in the financial
statements or the notes thereto.
14
<PAGE>
ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON
FORM 8-K - (CONTINUED)
3. Exhibits
(a) The following exhibits are filed as a part of this report:
Exhibit No.
3 Certificate of Trust of Premier Auto Trust 1998-5.
4.1 Amended and Restated Trust Agreement, dated as of
October 1, 1998, among Premier Receivables L.L.C.,
Chrysler Financial Corporation and Chase Manhattan
Bank Delaware, as Owner Trustee.
4.2 Indenture, dated as of October 1, 1998, between Premier
Auto Trust 1998-5 and The First National Bank of
Chicago, as Indenture Trustee (excluding Schedule A).
4.3 Sale and Servicing Agreement, dated as of October 1,
1998, between Premier Auto Trust 1998-5 and Chrysler
Financial Corporation (excluding Schedules A and C).
27 Financial Data Schedule
(b) No reports on Form 8-K were filed by the Trust during the last
quarter of the period covered by this report.
15
<PAGE>
PREMIER AUTO TRUST 1998-5
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) the Securities Exchange
Act of 1934, the registrant has duly caused this report to be signed on its
behalf by the undersigned, thereunto duly authorized.
Premier Auto Trust 1998-5 (Registrant)
By: Chrysler Financial Company L.L.C., as Servicer
----------------------------------------------
Date: March 5, 1999 By: /s/ David H. Olsen
----------------------------------------------
David H. Olsen, Vice President and Controller
Principal Accounting Officer
SUPPLEMENTAL INFORMATION TO BE FURNISHED WITH REPORTS FILED PURSUANT TO
SECTION 15(d) OF THE ACT BY REGISTRANTS WHICH HAVE NOT REGISTERED SECURITIES
PURSUANT TO SECTION 12 OF THE ACT.
No annual report or proxy material has been sent to security holders.
16
<PAGE>
PREMIER AUTO TRUST 1998-5
EXHIBIT INDEX
Exhibit
Number Description of Exhibit
- ------- ----------------------
3 Certificate of Trust of Premier Auto Trust 1998-5.
4.1 Amended and Restated Trust Agreement, dated as of October 1,
1998, among Premier Receivables L.L.C., Chrysler Financial
Corporation and, Chase Manhattan Bank Delaware as Owner
Trustee.
4.2 Indenture, dated as of October 1, 1998, between Premier
Auto Trust 1998-5 and The First National Bank of Chicago,
as Indenture Trustee (excluding Schedule A).
4.3 Sale and Servicing Agreement, dated as of October 1, 1998,
between Premier Auto Trust 1998-5 and Chrysler Financial
Corporation (excluding Schedules A and C).
27 Financial Data Schedule
E-1
Exhibit 3
State of Delaware
Office of the Secretary of State PAGE 1
--------------
I, EDWARD J. FREEL, SECRETARY OF STATE OF THE STATE OF DELAWARE, DO
HEREBY CERTIFY THE ATTACHED IS A TRUE AND CORRECT COPY OF THE CERTIFICATE OF
BUSINESS TRUST REGISTRATION OF "PREMIER AUTO TRUST 1998-5", FILED IN THIS
OFFICE ON THE SIXTH DAY OF OCTOBER, A.D. 1998, AT 8:30 O'CLOCK A.M.
/s/ Edward J. Freel
-----------------------------------
[ SEAL ] Edward J. Freel, Secretary of State
2952640 8100 AUTHENTICATION: 9341044
981387046 DATE: 10-06-98
<PAGE>
CERTIFICATE OF TRUST
OF
PREMIER AUTO TRUST 1998-5
THIS Certificate of Trust of Premier Auto Trust 1998-4 (the "Trust")
is being duly executed and filed by Chase Manhattan Bank Delaware, a Delaware
banking corporation, as trustee, to form a business trust under the Delaware
Business Trust Act (12 Del C ss 3801 et seq.) (the "Act").
1. Name: The name of the business trust formed hereby is Premier
Auto Trust 1998-5.
2. Delaware Trustee: The name and business address of the trustee
of the Trust in the State of Delaware is Chase Manhattan Bank Delaware, 1201
Market Street, Wilmington, Delaware 19801, Attention: Corporate Trustee
Administration Department.
3. Effective Date: This Certificate of Trust shall be effective
upon its filing with the Secretary of State of the State of Delaware.
IN WITNESS WHEREOF, the undersigned has executed this Certificate of
Trust in accordance with Section 3811(a) of the Act.
CHASE MANHATTAN BANK DELAWARE, not in
its individual capacity but solely as
trustee.
By: /s/ J.J. Cashin
-----------------------------
Name: JJ. CASHIN
Title: VICE-PRESIDENT
STATE OF DELAWARE
SECRETARY OF STATE
DIVISION OF CORPORATIONS
FILED 08:30 AM 10/06/1998
981387046 - 2952640
<PAGE>
State of Delaware
Office of the Secretary of State PAGE 1
--------------
I, EDWARD J. FREEL, SECRETARY OF STATE OF THE STATE OF DELAWARE, DO
HEREBY CERTIFY THE ATTACHED IS A TRUE AND CORRECT COPY OF CORRECTED
CERTIFICATE OF BUSINESS TRUST REGISTRATION OF "PREMIER AUTO TRUST 1998-5",
FILED IN THIS OFFICE ON THE TWENTY-SEVENTH DAY OF OCTOBER, A.D. 1998,
AT 8:30 O'CLOCK A.M.
/s/ Edward J. Freel
-----------------------------------
[ SEAL ] Edward J. Freel, Secretary of State
2952640 8101 AUTHENTICATION: 9374710
981413880 DATE: 10-27-98
<PAGE>
CORRECTED
CERTIFICATE OF TRUST OF
PREMIER AUTO TRUST 1998-5
THIS Corrected Certificate of Trust of Premier Auto Trust 1998-5
(the "Trust"), is being duly executed and filed by Chase Manhattan Bank
Delaware, a Delaware banking corporation, as trustee, to correct the
Certificate of Trust of the Trust which was filed on October 6, 1998 with
the Secretary of State of the State of Delaware under the Delaware Business
Trust Act (12 Del. C. ss. 3801 et seq.) (the "Certificate of Trust").
1. Line one of the Certificate of Trust incorrectly identified the
Trust as Premier Auto Trust 1998-4, and said Certificate of Trust requires
correction as permitted under the Delaware Business Trust Act (12 Del. C.
ss. 3810(e)).
2. The Certifcate of Trust is hereby corrected to read in its
entirety as follows:
STATE OF DELAWARE
SECRETARY OF STATE
DIVISION OF CORPORATION
FILED 08:30 AM 10/27/1998
981413680 - 2952640
<PAGE>
CERTIFICATE OF TRUST
OF
PREMIER AUTO TRUST 1998-5
THIS Certificate of Trust of Premier Auto Trust 1998-5 (the "Trust")
is being duly executed and filed by Chase Manhattan Bank Delaware, a Delaware
banking corporation, as trustee, to form a business trust under the Delaware
Business Trust Act (12 Del C ss 3801 et seq.) (the "Act").
1. Name: The name of the business trust formed hereby is Premier
Auto Trust 1998-5.
2. Delaware Trustee: The name and business address of the trustee
of the Trust in the State of Delaware is Chase Manhattan Bank Delaware, 1201
Market Street, Wilmington, Delaware 19801, Attention: Corporate Trustee
Administration Department.
3. Effective Date: This Certificate of Trust shall be effective
upon its filing with the Secretary of State of the State of Delaware.
IN WITNESS WHEREOF, the undersigned has executed this Certificate of
Trust in accordance with Section 3811(a) of the Act.
CHASE MANHATTAN BANK DELAWARE, not in
its individual capacity but solely as
trustee.
By: /s/ J.J. Cashin
-----------------------------
Name: JJ. CASHIN
Title: VICE-PRESIDENT
Conformed Copy
=============================================================================
AMENDED AND RESTATED
TRUST AGREEMENT
Among
CHRYSLER FINANCIAL CORPORATION,
as Depositor,
PREMIER RECEIVABLES L.L.C.
And
CHASE MANHATTAN BANK DELAWARE,
as Owner Trustee
Dated as of October 1, 1998
=============================================================================
<PAGE>
Table of Contents
Page
----
ARTICLE I
Definitions
SECTION 1.01. Capitalized Terms......................................... 1
SECTION 1.02. Other Definitional Provisions............................. 4
ARTICLE II
Organization
SECTION 2.01. Name...................................................... 5
SECTION 2.02. Office.................................................... 5
SECTION 2.03. Purposes and Powers....................................... 5
SECTION 2.04. Appointment of Owner Trustee.............................. 6
SECTION 2.05. Initial Capital Contribution of Owner Trust Estate........ 6
SECTION 2.06. Declaration of Trust...................................... 6
SECTION 2.07. Liability of Owners....................................... 6
SECTION 2.08. Title to Trust Property................................... 6
SECTION 2.09. Situs of Trust............................................ 6
SECTION 2.10. Representations and Warranties of Depositor and Company... 7
ARTICLE III
Certificates and Transfer of Interests
SECTION 3.01. Initial Ownership......................................... 9
SECTION 3.02. The Certificates.......................................... 9
SECTION 3.03. Authentication of Certificates............................ 9
SECTION 3.04. Registration of Transfer and Exchange of
Certificates; Limitations on Transfer..................... 9
SECTION 3.05. Mutilated, Destroyed, Lost or Stolen Certificates......... 11
SECTION 3.06. Persons Deemed Owners..................................... 11
SECTION 3.07. Access to List of Certificateholders' Names and Addresses. 11
SECTION 3.08. Maintenance of Office or Agency........................... 12
SECTION 3.09. Appointment of Paying Agent............................... 12
SECTION 3.10. Definitive Certificates................................... 12
SECTION 3.11. Fixed Value Securities.................................... 12
ARTICLE IV
Actions by Owner Trustee
SECTION 4.01. Prior Notice to Owners with Respect to Certain Matters.... 14
SECTION 4.02. Action by Owners with Respect to Certain Matters.......... 14
SECTION 4.03. Action by Owners with Respect to Bankruptcy............... 14
SECTION 4.04. Restrictions on Owners' Power............................. 15
i
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SECTION 4.05. Majority Control.......................................... 15
ARTICLE V
Application of Trust Funds; Certain Duties
SECTION 5.01. Establishment of Collection Account....................... 15
SECTION 5.02. Application of Trust Funds................................ 15
SECTION 5.03. Method of Payment......................................... 16
SECTION 5.04. [Reserved]................................................ 16
SECTION 5.05. Accounting and Reports to Owners, Internal Revenue
Service and Others........................................ 16
ARTICLE VI
Authority and Duties of Owner Trustee
SECTION 6.01. General Authority......................................... 17
SECTION 6.02. General Duties............................................ 17
SECTION 6.03. Action upon Instruction................................... 17
SECTION 6.04. No Duties Except as Specified in this Agreement
or in Instructions........................................ 18
SECTION 6.05. No Action Except Under Specified Documents or
Instructions.............................................. 18
SECTION 6.06. Restrictions.............................................. 18
ARTICLE VII
Concerning Owner Trustee
SECTION 7.01. Acceptance of Trusts and Duties........................... 19
SECTION 7.02. Furnishing of Documents................................... 20
SECTION 7.03. Representations and Warranties............................ 20
SECTION 7.04. Reliance; Advice of Counsel............................... 20
SECTION 7.05. Not Acting in Individual Capacity......................... 21
SECTION 7.06. Owner Trustee Not Liable for Certificates or
Receivables............................................... 21
SECTION 7.07. Owner Trustee May Own Certificates and Notes.............. 21
SECTION 7.08. Pennsylvania Motor Vehicle Sales Finance Act Licenses..... 22
ARTICLE VIII
Compensation of Owner Trustee
SECTION 8.01. Owner Trustee's Fees and Expenses......................... 22
SECTION 8.02. Indemnification........................................... 22
SECTION 8.03. Payments to Owner Trustee................................. 22
ARTICLE IX
Termination of Trust Agreement
SECTION 9.01. Termination of Trust Agreement............................ 23
ii
<PAGE>
ARTICLE X
Successor Owner Trustees and Additional Owner Trustees
SECTION 10.01. Eligibility Requirements for Owner Trustee................ 24
SECTION 10.02. Resignation or Removal of Owner Trustee................... 24
SECTION 10.03. Successor Owner Trustee................................... 25
SECTION 10.04. Merger or Consolidation of Owner Trustee.................. 25
SECTION 10.05. Appointment of Co-Trustee or Separate Trustee............. 25
ARTICLE XI
Miscellaneous
SECTION 11.01. Supplements and Amendments................................ 27
SECTION 11.02. No Legal Title to Owner Trust Estate in Owners............ 28
SECTION 11.03. Limitations on Rights of Others........................... 28
SECTION 11.04. Notices................................................... 28
SECTION 11.05. Severability.............................................. 29
SECTION 11.06. Separate Counterparts..................................... 29
SECTION 11.07. Successors and Assigns.................................... 29
SECTION 11.08. Covenants of Company...................................... 29
SECTION 11.09. No Petition............................................... 29
SECTION 11.10. No Recourse............................................... 29
SECTION 11.11. Headings.................................................. 30
SECTION 11.12. GOVERNING LAW............................................. 30
SECTION 11.13. Certificate Transfer Restrictions......................... 30
SECTION 11.14. Depositor Payment Obligation.............................. 30
EXHIBITS
EXHIBIT A-1 Form of Trust Certificate...............................A-1-1
EXHIBIT A-2 Form of Overcollateralization Certificate...............A-2-1
EXHIBIT B Form of Certificate of Trust of Premier
Auto Trust 1998-4.........................................B-1
EXHIBIT C Form of Transferor Certificate............................C-1
EXHIBIT D Form of Investment Letter.................................D-1
EXHIBIT E Form of Rule 144A Letter..................................E-1
iii
<PAGE>
AMENDED AND RESTATED TRUST AGREEMENT dated as of October 1, 1998,
among CHRYSLER FINANCIAL CORPORATION, a Michigan corporation, as
depositor (the "Depositor"), PREMIER RECEIVABLES L.L.C. (the
"Company"), a Michigan limited liability company, and CHASE
MANHATTAN BANK DELAWARE, a Delaware banking corporation, as owner
trustee.
WHEREAS, the Depositor, the Owner Trustee and the Company entered
into a Trust Agreement dated October 1, 1998 (the "Trust Agreement");
WHEREAS, the Trust Agreement is being amended and restated as of
October 1, 1998;
WHEREAS, the Depositor and the Company have entered into a Purchase
Agreement dated as of October 1, 1998 (the "Purchase Agreement"), pursuant to
which the Depositor will assign to the Company any and all of the Depositor's
rights and interests with respect to the receipt of amounts from the Reserve
Account and with respect to any Fixed Value Payments and Fixed Value Finance
Charges; and
WHEREAS, in connection therewith, the Company is willing to assume
certain obligations pursuant hereto;
NOW, THEREFORE, the Depositor, the Company and the Owner Trustee
hereby agree as follows:
ARTICLE I
Definitions
SECTION 1.01. Capitalized Terms. For all purposes of this Agreement,
the following terms shall have the meanings set forth below:
"Administration Agreement" shall mean the Administration Agreement
dated as of October 1, 1998, among the Trust, the Indenture Trustee and CFC,
as Administrator.
"Agreement" shall mean this Amended and Restated Trust Agreement, as
the same may be amended and supplemented from time to time.
"Basic Documents" shall mean the Purchase Agreement, the Sale and
Servicing Agreement, the Indenture, the Administration Agreement, the Note
Depository Agreement and the other documents and certificates delivered in
connection therewith.
"Benefit Plan" shall have the meaning assigned to such term in
Section 11.13.
"Business Trust Statute" shall mean Chapter 38 of Title 12 of the
Delaware Code, 12 Del. Code ss. 3801 et seq., as the same may be amended from
time to time.
1
<PAGE>
"Certificate Balance" shall mean the outstanding principal balance
of the Overcollateralization Certificates and shall equal the Initial
Certificate Balance less the aggregate amount previously distributed to the
Holders of the Overcollateralization Certificates pursuant to Section
5.06(a)(ii)(E) of the Sale and Servicing Agreement.
"Certificates" shall mean the Trust Certificates and the
Overcollateralization Certificates.
"Certificate of Trust" shall mean the Certificate of Trust in the
form of Exhibit B filed for the Trust pursuant to Section 3810(a) of the
Business Trust Statute.
"Certificate Register" and "Certificate Registrar" shall mean the
register mentioned in and the registrar appointed pursuant to Section 3.04.
"Certificateholder" or "Holder" shall mean a Person in whose name a
Certificate is registered.
"CFC" shall mean Chrysler Financial Corporation, a Michigan
corporation, and any successor in interest.
"Code" shall mean the Internal Revenue Code of 1986, as amended, and
Treasury Regulations promulgated thereunder.
"Company" shall mean Premier Receivables L.L.C., a Michigan limited
liability company, and any successor in interest.
"Corporate Trust Office" shall mean, with respect to the Owner
Trustee, the principal corporate trust office of the Owner Trustee located at
1201 Market Street, Wilmington, Delaware 19801, or at such other address as
the Owner Trustee may designate by notice to the Owners, the Depositor and
the Company, or the principal corporate trust office of any successor Owner
Trustee at the address designated by such successor Owner Trustee by notice
to the Owners, the Depositor and the Company.
"Depositor" shall mean CFC in its capacity as depositor hereunder.
"ERISA" shall mean the Employee Retirement Income Security Act of
1974, as amended.
"Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended.
"Expenses" shall have the meaning assigned to such term in Section
8.02.
"Indemnified Parties" shall have the meaning assigned to such term
in Section 8.02.
"Indenture" shall mean the Indenture dated as of October 1, 1998
between the Trust and The First National Bank of Chicago, as Indenture
Trustee.
"Initial Certificate Balance" shall mean $65,625,000.00.
2
<PAGE>
"Note Depository Agreement" shall mean the agreement dated October
23, 1998 among the Trust, the Indenture Trustee, the Administrator and The
Depository Trust Company, as the initial Clearing Agency, relating to the
Class A-1 Notes, the Class A-2 Notes, the Class A-3 Notes and the Class A-4
Notes, as the same may be amended and supplemented from time to time.
"Opinion of Counsel" means one or more written opinions of counsel,
who may be an employee of or counsel to the Seller, the Company or the
Servicer, which counsel shall be acceptable to the Indenture Trustee, the
Owner Trustee or the Rating Agencies, as applicable.
"Overcollateralization Certificate" shall mean a certificate
evidencing the beneficial interest of an Owner in the Trust entitled to
receive the Certificate Balance pursuant to Section 5.06(a)(ii)(E) of the
Sale and Servicing Agreement, substantially in the form attached hereto as
Exhibit A-2.
"Owner" shall mean each Holder of a Certificate.
"Owner Trust Estate" shall mean all right, title and interest of the
Trust in and to the property and rights assigned to the Trust pursuant to
Article II of the Sale and Servicing Agreement, all funds on deposit from
time to time in the Collection Account and all other property of the Trust
from time to time, including any rights of the Owner Trustee and the Trust
pursuant to the Sale and Servicing Agreement and the Administration
Agreement.
"Owner Trustee" shall mean Chase Manhattan Bank Delaware, a Delaware
banking corporation, not in its individual capacity but solely as owner
trustee under this Agreement, and any successor Owner Trustee hereunder.
"Paying Agent" shall mean any paying agent or co-paying agent
appointed pursuant to Section 3.09 and shall initially be the Indenture
Trustee.
"Percentage Interest" means, as to any Trust Certificate, the
percentage interest, specified on the face thereof, in the distributions on
the Trust Certificates pursuant to this Agreement.
"Record Date" shall mean, with respect to any Distribution Date, the
15th day of the month preceding such Distribution Date.
"Sale and Servicing Agreement" shall mean the Sale and Servicing
Agreement dated as of October 1, 1998, between the Trust, as issuer, and the
Depositor, as seller and servicer, as the same may be amended or supplemented
from time to time.
"Secretary of State" shall mean the Secretary of State of the State
of Delaware.
"Treasury Regulations" shall mean regulations, including proposed or
temporary Regulations, promulgated under the Code. References herein to
specific provisions of proposed or temporary regulations shall include
analogous provisions of final Treasury Regulations or other successor
Treasury Regulations.
3
<PAGE>
"Trust" shall mean the trust established by this Agreement.
"Trust Certificate" shall mean a certificate evidencing the
beneficial interest of an Owner in the Trust, substantially in the form
attached hereto as Exhibit A-1.
SECTION 1.02. Other Definitional Provisions. i) Capitalized terms
used and not otherwise defined herein have the meanings assigned to them in
the Sale and Servicing Agreement or, if not defined therein, in the
Indenture.
(b) All terms defined in this Agreement shall have the defined
meanings when used in any certificate or other document made or delivered
pursuant hereto unless otherwise defined therein.
(c) As used in this Agreement and in any certificate or other
document made or delivered pursuant hereto or thereto, accounting terms not
defined in this Agreement or in any such certificate or other document, and
accounting terms partly defined in this Agreement or in any such certificate
or other document to the extent not defined, shall have the respective
meanings given to them under generally accepted accounting principles. To the
extent that the definitions of accounting terms in this Agreement or in any
such certificate or other document are inconsistent with the meanings of such
terms under generally accepted accounting principles, the definitions
contained in this Agreement or in any such certificate or other document
shall control.
(d) The words "hereof," "herein," "hereunder" and words of similar
import when used in this Agreement shall refer to this Agreement as a whole
and not to any particular provision of this Agreement; Section and Exhibit
references contained in this Agreement are references to Sections and
Exhibits in or to this Agreement unless otherwise specified; and the term
"including" shall mean "including without limitation".
(e) The definitions contained in this Agreement are applicable to
the singular as well as the plural forms of such terms and to the masculine
as well as to the feminine and neuter genders of such terms.
(f) Any agreement, instrument or statute defined or referred to
herein or in any instrument or certificate delivered in connection herewith
means such agreement, instrument or statute as from time to time amended,
modified or supplemented and includes (in the case of agreements or
instruments) references to all attachments thereto and instruments
incorporated therein; references to a Person are also to its permitted
successors and assigns.
4
<PAGE>
ARTICLE II
Organization
SECTION 2.01. Name. The Trust created hereby shall be known as
"Premier Auto Trust 1998-5," in which name the Owner Trustee may conduct the
business of the Trust, make and execute contracts and other instruments on
behalf of the Trust and sue and be sued.
SECTION 2.02. Office. The office of the Trust shall be in care of
the Owner Trustee at the Corporate Trust Office or at such other address in
Delaware as the Owner Trustee may designate by written notice to the Owners,
the Depositor and the Company.
SECTION 2.03. Purposes and Powers. The purpose of the Trust is to
engage in the following activities:
(i) to issue the Notes pursuant to the Indenture and the
Certificates pursuant to this Agreement and to sell the Notes and
the Certificates;
(ii) with the proceeds of the sale of the Notes and the
Certificates, to purchase the Receivables, to fund the Reserve
Account, to pay the organizational, start-up and transactional
expenses of the Trust and to pay the balance to the Depositor
pursuant to the Sale and Servicing Agreement;
(iii) to assign, grant, transfer, pledge, mortgage and
convey the Trust Estate pursuant to the Indenture and to hold,
manage and distribute to the Owners pursuant to the terms of the
Sale and Servicing Agreement any portion of the Trust Estate
released from the Lien of, and remitted to the Trust pursuant to,
the Indenture;
(iv) to enter into and perform its obligations under the
Basic Documents to which it is to be a party;
(v) to sell the Fixed Value Payments to the Depositor
and, if requested by the Company (as assignee of the Depositor),
subsequently to acquire the Fixed Value Payments and to issue and
sell the Fixed Value Securities;
(vi) to engage in those activities, including entering
into agreements, that are necessary or suitable to accomplish the
foregoing or are incidental thereto or connected therewith; and
(vii) subject to compliance with the Basic Documents, to
engage in such other activities as may be required in connection
with conservation of the Owner Trust Estate and the making of
distributions to the Owners and the Noteholders and in respect of
the Fixed Value Securities.
The Trust is hereby authorized to engage in the foregoing activities. The
Trust shall not engage in any activity other than in connection with the
foregoing or other than as required or authorized by the terms of this
Agreement or the Basic Documents.
5
<PAGE>
SECTION 2.04. Appointment of Owner Trustee. The Depositor hereby
appoints the Owner Trustee as trustee of the Trust effective as of the date
hereof, to have all the rights, powers and duties set forth herein.
SECTION 2.05. Initial Capital Contribution of Owner Trust Estate.
The Depositor hereby sells, assigns, transfers, conveys and sets over to the
Owner Trustee, as of the date hereof, the sum of $1. The Owner Trustee hereby
acknowledges receipt in trust from the Depositor, as of the date hereof, of
the foregoing contribution, which shall constitute the initial Owner Trust
Estate and shall be deposited in the Collection Account. The Depositor shall
pay organizational expenses of the Trust as they may arise or shall, upon the
request of the Owner Trustee, promptly reimburse the Owner Trustee for any
such expenses paid by the Owner Trustee.
SECTION 2.06. Declaration of Trust. The Owner Trustee hereby
declares that it will hold the Owner Trust Estate in trust upon and subject
to the conditions set forth herein for the use and benefit of the Owners,
subject to the obligations of the Trust under the Basic Documents. It is the
intention of the parties hereto that the Trust constitute a business trust
under the Business Trust Statute and that this Agreement constitute the
governing instrument of such business trust. It is the intention of the
parties hereto that, solely for income and franchise tax purposes, (i) so
long as there is a sole Owner, the Trust shall be treated as a security
arrangement, with the assets of the Trust being the Receivables and other
assets held by the Trust, the owner of the Receivables being the sole Owner
and the Notes being non-recourse debt of the sole Owner and (ii) if there is
more than one Owner, the Trust shall be treated as a partnership for income
and franchise tax purposes, with the assets of the partnership being the
Receivables and other assets held by the Trust, the partners of the
partnership being the Owners (including the Company as assignee of the
Depositor pursuant to the Purchase Agreement, in its capacity as recipient of
distributions from the Reserve Account) and the Notes being debt of the
partnership. The parties agree that, unless otherwise required by appropriate
tax authorities, the Trust will file or cause to be filed annual or other
necessary returns, reports and other forms consistent with the
characterization of the Trust as provided in the preceding sentence for such
tax purposes. Effective as of the date hereof, the Owner Trustee shall have
all rights, powers and duties set forth herein and in the Business Trust
Statute with respect to accomplishing the purposes of the Trust.
SECTION 2.07. Liability of Owners. The Owners (including the
Company) shall be entitled to the same limitation of personal liability
extended to stockholders of private corporations for profit organized under
the general corporation law of the State of Delaware.
SECTION 2.08. Title to Trust Property. Legal title to all the Owner
Trust Estate shall be vested at all times in the Trust as a separate legal
entity except where applicable law in any jurisdiction requires title to any
part of the Owner Trust Estate to be vested in a trustee or trustees, in
which case title shall be deemed to be vested in the Owner Trustee, a
co-trustee and/or a separate trustee, as the case may be.
SECTION 2.09. Situs of Trust. The Trust will be located and
administered in the State of Delaware. All bank accounts maintained by the
Owner Trustee on behalf of the Trust shall be located in the State of
Delaware or the State of New York. The Trust shall not have any
6
<PAGE>
employees in any state other than Delaware; provided, however, that nothing
herein shall restrict or prohibit the Owner Trustee from having employees
within or without the State of Delaware. Payments will be received by the
Trust only in Delaware or New York, and payments will be made by the Trust
only from Delaware or New York. The only office of the Trust will be at the
Corporate Trust Office in Delaware.
SECTION 2.10. Representations and Warranties of Depositor and
Company. i) The Depositor hereby represents and warrants to the Owner Trustee
that:
(i) The Depositor is duly organized and validly existing
as a corporation in good standing under the laws of the State of
Michigan, with power and authority to own its properties and to
conduct its business as such properties are currently owned and such
business is presently conducted.
(ii) The Depositor 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 its property or the conduct of its business shall
require such qualifications.
(iii) The Depositor has the power and authority to
execute and deliver this Agreement and to carry out its terms; the
Depositor has full power and authority to sell and assign the
property to be sold and assigned to and deposited with the Trust and
the Depositor has duly authorized such sale and assignment and
deposit to the Trust by all necessary corporate action; and the
execution, delivery and performance of this Agreement have been duly
authorized by the Depositor by all necessary corporate action.
(iv) 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, or constitute (with or without notice or lapse of
time) a default under, the articles of incorporation or bylaws of
the Depositor, or any indenture, agreement or other instrument to
which the Depositor is a party or by which it is bound; nor result
in the creation or imposition of any Lien upon any of its properties
pursuant to the terms of any such indenture, agreement or other
instrument (other than pursuant to the Basic Documents); nor violate
any law or, to the best of the Depositor's knowledge, any order,
rule or regulation applicable to the Depositor of any court or of
any federal or state regulatory body, administrative agency or other
governmental instrumentality having jurisdiction over the Depositor
or its properties.
(v) To the Depositor's best knowledge, there are no
proceedings or investigations pending or threatened before any
court, regulatory body, administrative agency or other governmental
instrumentality having jurisdiction over the Depositor or its
properties: (A) asserting the invalidity of this Agreement, (B)
seeking to prevent the consummation of any of the transactions
contemplated by this Agreement or (C) seeking any determination or
ruling that might materially and adversely affect the performance by
the Depositor of its obligations under, or the validity or
enforceability of, this Agreement.
7
<PAGE>
(vi) The representations and warranties of the Company
and the Depositor in Sections 3.01 and 3.02 of the Purchase
Agreement are true and correct.
(b) The Company hereby represents and warrants to the Owner Trustee
that:
(i) The Company has been duly organized and is validly
existing as a limited liability company in good standing under the
laws of the jurisdiction of its organization, with the power and
authority to own its properties and to conduct its business as such
properties are currently owned and such business is presently
conducted.
(ii) The Company is duly qualified to do business as a
foreign limited liability company in good standing and has obtained
all necessary licenses and approvals in all jurisdictions in which
the ownership or lease of its property or the conduct of its
business shall require such qualifications.
(iii) The Company has the power and authority to execute
and deliver this Agreement and to carry out its terms; the Company
has full power and authority to purchase the Certificates; and the
execution, delivery and performance of this Agreement has been duly
authorized by the Company by all necessary action.
(iv) 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, or constitute (with or without notice or lapse of
time) a default under, the articles of organization or operating
agreement of the Company, or any indenture, agreement or other
instrument to which the Company is a party or by which it is bound;
nor result in the creation or imposition of any Lien upon any of its
properties pursuant to the terms of any such indenture, agreement or
other instrument (other than pursuant to the Basic Documents); nor
violate any law or, to the best of the Company's knowledge, any
order, rule or regulation applicable to the Company of any court or
of any federal or state regulatory body, administrative agency or
other governmental instrumentality having jurisdiction over the
Company or its properties.
(v) There are no proceedings or investigations pending
or, to the Company's best knowledge, threatened before any court,
regulatory body, administrative agency or other governmental
instrumentality having jurisdiction over the Company or its
properties: (A) asserting the invalidity of this Agreement, (B)
seeking to prevent the consummation of any of the transactions
contemplated by this Agreement or (C) seeking any determination or
ruling that might materially and adversely affect the performance by
the Company of its obligations under, or the validity or
enforceability of, this Agreement.
8
<PAGE>
ARTICLE III
Certificates and Transfer of Interests
SECTION 3.01. Initial Ownership. Upon the formation of the Trust by
the contribution by the Depositor pursuant to Section 2.05 and until the
issuance of the Certificates, the Depositor shall be the sole beneficiary of
the Trust.
SECTION 3.02. The Certificates. The Trust Certificates shall be
issued in minimum denominations of a one percent Percentage Interest in the
Trust. The Overcollateralization Certificates shall be issued in minimum
denominations of $1,000,000 principal amount of Certificate Balance. The
Certificates shall be executed on behalf of the Trust by manual or facsimile
signature of an authorized officer of the Owner 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 validly issued and entitled to the benefit of this Agreement,
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 authentication and delivery of
such Certificates.
A transferee of a Certificate shall become a Certificateholder and
shall be entitled to the rights and subject to the obligations of a
Certificateholder hereunder upon such transferee's acceptance of a
Certificate duly registered in such transferee's name pursuant to Section
3.04.
SECTION 3.03. Authentication of Certificates. On the Closing Date,
the Owner Trustee shall cause the Trust Certificates in an aggregate
Percentage Interest equal to 100% and the Overcollateralization Certificates
in an aggregate principal amount equal to the Initial Certificate Balance to
be executed on behalf of the Trust, authenticated and delivered to or upon
the written order of the Depositor, signed by its chairman of the board, its
president, any vice president, secretary or any assistant treasurer, without
further corporate action by the Depositor, in the respective authorized
denominations. No Certificate shall entitle its Holder to any benefit under
this Agreement or 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-1 with respect to the Trust Certificates and Exhibit A-2
with respect to the Overcollateralization Certificates, executed by the Owner
Trustee or The Chase Manhattan Bank, as the Owner Trustee's authenticating
agent, by manual 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.
SECTION 3.04. Registration of Transfer and Exchange of Certificates;
Limitations on Transfer. The Certificate Registrar shall keep or cause to be
kept, at the office or agency maintained pursuant to Section 3.08, a
Certificate Register in which, subject to such reasonable regulations as it
may prescribe, the Owner Trustee shall provide for the registration of
Certificates and of transfers and exchanges of Certificates as herein
provided. The Chase Manhattan Bank shall be the initial Certificate
Registrar.
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The Certificates have not been and will not be registered under the
Securities Act and will not be listed on any exchange. No transfer of a
Certificate shall be made unless such transfer is made pursuant to an
effective registration statement under the Securities Act and any applicable
state securities laws or is exempt from the registration requirements under
the Securities Act and such state securities laws. In the event that a
transfer is to be made in reliance upon an exemption from the Securities Act
and state securities laws, in order to assure compliance with the Securities
Act and such laws, the Holder desiring to effect such transfer and such
Holder's prospective transferee shall each certify to the Owner Trustee in
writing the facts surrounding the transfer in substantially the forms set
forth in Exhibit C (the "Transferor Certificate") and either Exhibit D (the
"Investment Letter") or Exhibit E (the "Rule 144A Letter"). Except in the
case of a transfer as to which the proposed transferee has provided a Rule
144A Letter, there shall also be delivered to the Owner Trustee an Opinion of
Counsel that such transfer may be made pursuant to an exemption from the
Securities Act and state securities laws, which Opinion of Counsel shall not
be an expense of the Trust or the Owner Trustee; provided that such Opinion
of Counsel in respect of the applicable state securities laws may be a
memorandum of law rather than an opinion if such counsel is not licensed in
the applicable jurisdiction. The Depositor shall provide to any Holder of a
Certificate and any prospective transferee designated by any such Holder,
information regarding the Certificates and the Receivables and such other
information as shall be necessary to satisfy the condition to eligibility set
forth in Rule 144A(d)(4) for transfer of any such Certificate without
registration thereof under the Securities Act pursuant to the registration
exemption provided by Rule 144A. Each Holder of a Certificate desiring to
effect such a transfer shall, and does hereby agree to, indemnify the Trust,
the Owner Trustee, and the Depositor against any liability that may result if
the transfer is not so exempt or is not made in accordance with federal and
state securities laws. The Owner Trustee shall cause each Certificate to
contain a legend in the form set forth on the form of Certificate attached
hereto as Exhibit A-1 or Exhibit A-2, as applicable.
Upon surrender for registration of transfer of any Certificate at
the office or agency maintained pursuant to Section 3.08 and subject to the
satisfaction of the preceding paragraph, the Owner Trustee shall execute,
authenticate and deliver (or shall cause The Chase Manhattan Bank as its
authenticating agent to authenticate and deliver), in the name of the
designated transferee or transferees, one or more new Certificates of like
tenor and in authorized denominations of a like aggregate Percentage Interest
or principal amount, as applicable, dated the date of authentication by the
Owner Trustee or any authenticating agent; provided that prior to such
execution, authentication and delivery, the Owner Trustee shall have received
an Opinion of Counsel to the effect that the proposed transfer will not cause
the Trust to be characterized as an association (or a publicly traded
partnership) taxable as a corporation or alter the tax characterization of
the Notes for federal income tax purposes or Michigan income and single
business tax purposes. At the option of a Holder, Certificates may be
exchanged for other Certificates of like tenor and of authorized
denominations of a like aggregate Percentage Interest or principal amount, as
applicable, upon surrender of the Certificates to be exchanged at the office
or agency maintained pursuant to Section 3.08.
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 Owner Trustee and
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the Certificate Registrar duly executed by the Holder or such Holder's
attorney duly authorized in writing. Each Certificate surrendered for
registration of transfer or exchange shall be cancelled and subsequently
disposed of by the Owner Trustee in accordance with its customary practice.
No service charge shall be made for any registration of transfer or
exchange of Certificates, but the Owner Trustee or the Certificate Registrar
may require payment of a sum sufficient to cover any tax or governmental
charge that may be imposed in connection with any transfer or exchange of
Certificates.
The preceding provisions of this Section notwithstanding, the Owner
Trustee shall not make, and the Certificate Registrar shall not register
transfers or exchanges of, Certificates for a period of 15 days preceding the
due date for any payment with respect to the Certificates.
SECTION 3.05. 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 Owner 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 has been
acquired by a bona fide purchaser, the Owner Trustee on behalf of the Trust
shall execute and the Owner Trustee or The Chase Manhattan Bank, as the Owner
Trustee's authenticating agent, 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, the Owner Trustee or 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 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 3.06. Persons Deemed Owners. Prior to due presentation of a
Certificate for registration of transfer, the Owner Trustee, the Certificate
Registrar or any Paying Agent may treat the Person in whose name any
Certificate is registered in the Certificate Register as the owner of such
Certificate for the purpose of receiving distributions pursuant to Section
5.02 and for all other purposes whatsoever, and none of the Owner Trustee,
the Certificate Registrar or any Paying Agent shall be bound by any notice to
the contrary.
SECTION 3.07. Access to List of Certificateholders' Names and
Addresses. The Owner Trustee shall furnish or cause to be furnished to the
Servicer and the Depositor, within 15 days after receipt by the Owner Trustee
of a written request therefor from the Servicer or the Depositor, a list, in
such form as the Servicer or the Depositor may reasonably require, of the
names and addresses of the Certificateholders as of the most recent Record
Date. If a Certificateholder applies in writing to the Owner Trustee, and
such application states that the applicant desires to communicate with other
Certificateholders with respect to their rights under this Agreement or under
the Certificates, then the Owner Trustee shall, within five Business Days
after the receipt of such application, afford such applicant access during
normal business
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hours to the current list of Certificateholders. Each Holder, by receiving
and holding a Certificate, shall be deemed to have agreed not to hold any of
the Depositor, the Company, the Certificate Registrar or the Owner Trustee
accountable by reason of the disclosure of its name and address, regardless
of the source from which such information was derived.
SECTION 3.08. Maintenance of Office or Agency. The Owner 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 Owner Trustee in respect of the Certificates and the Basic Documents may
be served. The Owner Trustee initially designates The Chase Manhattan Bank,
55 Water Street, New York, New York 10041 as its office for such purposes.
The Owner Trustee shall give prompt written notice to the Company and to the
Certificateholders of any change in the location of the Certificate Register
or any such office or agency.
SECTION 3.09. Appointment of Paying Agent. The Paying Agent shall
make distributions to Certificateholders from the Collection Account pursuant
to Section 5.02 and shall report the amounts of such distributions to the
Owner Trustee. Subject to the provisions of Section 5.06 of the Sale and
Servicing Agreement, any Paying Agent shall have the revocable power to
withdraw funds from the Collection Account for the purpose of making the
distributions referred to above. The Owner Trustee may revoke such power and
remove the Paying Agent if the Owner Trustee determines in its sole
discretion that the Paying Agent shall have failed to perform its obligations
under this Agreement in any material respect or that it is in the interest of
the Certificateholders to do so. The Paying Agent initially shall be the
Indenture Trustee, and any co-paying agent chosen by the Indenture Trustee
and acceptable to the Owner Trustee. The Person acting as Indenture Trustee
shall not be permitted to resign as Paying Agent so long as such Person is
acting as the Indenture Trustee. The Owner Trustee shall cause such successor
Paying Agent or any additional Paying Agent appointed by the Owner Trustee to
execute and deliver to the Owner Trustee an instrument in which such
successor Paying Agent or additional Paying Agent shall agree with the Owner
Trustee that, as Paying Agent, such successor Paying Agent or additional
Paying Agent will hold all sums, if any, held by it for payment to the
Certificateholders in trust for the benefit of the Certificateholders
entitled thereto until such sums shall be paid to such Certificateholders.
The Paying Agent shall return all unclaimed funds to the Owner Trustee and
upon removal of a Paying Agent such Paying Agent shall also return all funds
in its possession to the Owner Trustee. The provisions of Sections 7.01,
7.03, 7.04 and 8.01 shall apply to the Owner Trustee also in its role as
Paying Agent, for so long as the Owner Trustee shall act as Paying Agent and,
to the extent applicable, to any other paying agent appointed hereunder. Any
reference in this Agreement to the Paying Agent shall include any co-paying
agent unless the context requires otherwise.
SECTION 3.10. Definitive Certificates. The Certificates, upon
original issuance, will be issued in definitive, fully registered form.
SECTION 3.11. Fixed Value Securities. Pursuant to the Sale and
Servicing Agreement and the Purchase Agreement, promptly following the sale
of the Standard Receivables and Fixed Value Receivables to the Trust on the
Closing Date, the Trust will sell to the Depositor the Fixed Value Payments
and Fixed Value Finance Charges in accordance with Section 2.02 of the Sale
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and Servicing Agreement. Neither the Depositor nor the Company (as assignee
of the Depositor) shall transfer such Fixed Value Payments and Fixed Value
Finance Charges to any Person other than the Trust and except as contemplated
by the Purchase Agreement. At any time after the Trust sells the Fixed Value
Payments and Fixed Value Finance Charges to the Depositor, at the option of
the Company (as assignee of the Depositor) and upon 10 days prior written
notice to the Owner Trustee and the Indenture Trustee, the Company will be
permitted to sell to the Trust, and the Trust shall be obligated to purchase
from the Company (subject to the availability of funds), all or any portion
of the Fixed Value Payments and/or Fixed Value Finance Charges due under the
Receivables, subject to the terms and conditions of the Sale and Servicing
Agreement. Upon any such sale, (i) the Depositor, the Company and the Owner
Trustee will enter into an amendment to this Agreement to provide for, at the
election of the Company, the issuance of certificates representing ownership
interests in the Trust to the extent of the Fixed Value Payments and/or Fixed
Value Finance Charges due under the Receivables or the issuance of
indebtedness by the Trust secured by the Fixed Value Payments and/or Fixed
Value Finance Charges due under the Receivables and to make any other
provisions herein that are necessary or desirable in connection therewith and
(ii) the Owner Trustee and the Depositor will enter into any other agreements
or instruments related thereto as may be requested by the Company; provided,
however, that the Owner Trustee may, but shall not be obligated to, enter
into any such amendment, agreement or instrument that affects the Owner
Trustee's own rights, duties or immunities under this Agreement; and
provided, further, that the obligation of the Owner Trustee to enter into any
such amendment or other agreement or instrument is subject to the following
conditions precedent:
(a) Such amendment and other agreements and instruments, in forms
satisfactory to the Owner Trustee and, in the case of amendments or
agreements to be executed and delivered by the Indenture Trustee, the
Indenture Trustee, shall have been executed by each other party thereto and
delivered to the Owner Trustee;
(b) The Company shall have delivered to the Owner Trustee and the
Indenture Trustee an Officers' Certificate and an Opinion of Counsel to the
effect that each condition precedent (including the requirement with respect
to all required filings) provided by this Section has been complied with and
such amendment or other agreement or instrument is authorized or permitted by
this Agreement;
(c) The Rating Agency Condition shall have been satisfied with
respect to such sale and issuance;
(d) Such sale and issuance and such amendment or other agreement or
instrument shall not adversely affect in any material respect the interest of
any Noteholder or Certificateholder, and the Company shall have provided to
the Owner Trustee and the Indenture Trustee an Officers' Certificate to such
effect;
(e) The Owner Trustee and the Indenture Trustee shall have received
an Opinion of Counsel to the effect that such sale and issuance will not have
any material adverse tax consequence to the Trust or to any Noteholder or
Certificateholder; and
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(f) All filings and other actions required to continue the first
perfected interest of the Trust in the Owner Trust Estate and of the
Indenture Trustee in the Collateral shall have been duly made or taken by the
Company.
ARTICLE IV
Actions by Owner Trustee
SECTION 4.01. Prior Notice to Owners with Respect to Certain
Matters. With respect to the following matters, the Owner Trustee shall not
take action unless at least 30 days before the taking of such action, the
Owner Trustee shall have notified the Certificateholders in writing of the
proposed action and the Owners shall not have notified the Owner Trustee in
writing prior to the 30th day after such notice is given that such Owners
have withheld consent or provided alternative direction:
(a) the initiation of any claim or lawsuit by the Trust (except
claims or lawsuits brought in connection with the collection of the
Receivables) and the compromise of any action, claim or lawsuit brought by or
against the Trust (except with respect to the aforementioned claims or
lawsuits for collection of the Receivables);
(b) the election by the Trust to file an amendment to the
Certificate of Trust (unless such amendment is required to be filed under the
Business Trust Statute);
(c) the amendment of the Indenture by a supplemental indenture in
circumstances where the consent of any Noteholder is required;
(d) the amendment of the Indenture by a supplemental indenture in
circumstances where the consent of any Noteholder is not required and such
amendment materially adversely affects the interests of the Owners;
(e) the amendment, change or modification of the Administration
Agreement, except to cure any ambiguity or to amend or supplement any
provision in a manner or add any provision that would not materially
adversely affect the interests of the Owners; or
(f) the appointment pursuant to the Indenture of a successor Note
Registrar, Paying Agent or Indenture Trustee or pursuant to this Agreement of
a successor Certificate Registrar, or the consent to the assignment by the
Note Registrar, Paying Agent or Indenture Trustee or Certificate Registrar of
its obligations under the Indenture or this Agreement, as applicable.
SECTION 4.02. Action by Owners with Respect to Certain Matters. The
Owner Trustee shall not have the power, except upon the direction of the
Owners, to i) remove the Administrator under the Administration Agreement
pursuant to Section 8 thereof, (b) appoint a successor Administrator pursuant
to Section 8 of the Administration Agreement, (c) remove the Servicer under
the Sale and Servicing Agreement pursuant to Section 8.01 thereof or (d)
except as expressly provided in the Basic Documents, sell the Receivables
after the termination of the
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Indenture. The Owner Trustee shall take the actions referred to in the
preceding sentence only upon written instructions signed by the Owners.
SECTION 4.03. Action by Owners with Respect to Bankruptcy. The Owner
Trustee shall not have the power to commence a voluntary proceeding in
bankruptcy relating to the Trust without the unanimous prior approval of all
Owners and the delivery to the Owner Trustee by each such Owner of a
certificate certifying that such Owner reasonably believes that the Trust is
insolvent.
SECTION 4.04. Restrictions on Owners' Power. The Owners shall not
direct the Owner Trustee to take or to refrain from taking any action if such
action or inaction would be contrary to any obligation of the Trust or the
Owner Trustee under this Agreement or any of the Basic Documents or would be
contrary to Section 2.03, nor shall the Owner Trustee be obligated to follow
any such direction, if given.
SECTION 4.05. Majority Control. Except as expressly provided herein,
any action that may be taken by the Owners under this Agreement may be taken
by the Holders of the Certificates that include the Holders of Trust
Certificates evidencing not less than a majority of the Percentage Interests
evidenced by the Trust Certificates and the Holders of Overcollateralization
Certificates evidencing not less than a majority of the Certificate Balance.
Except as expressly provided herein, any written notice of the Owners
delivered pursuant to this Agreement shall be effective if signed by the
Holders of the Certificates that include Holders of Trust Certificates
evidencing not less than a majority of the Percentage Interests evidenced by
the Trust Certificates and the Holders of Overcollateralization Certificates
evidencing not less than a majority of the Certificate Balance, in each case,
at the time of the delivery of such notice.
ARTICLE V
Application of Trust Funds; Certain Duties
SECTION 5.01. Establishment of Collection Account. The Collection
Account shall be established and maintained pursuant to Section 5.01 of the
Sale and Servicing Agreement. The Collection Account shall be under the sole
dominion and control of the Indenture Trustee for the benefit of Noteholders
and the Certificateholders, as applicable in accordance with the Sale and
Servicing Agreement.
SECTION 5.02. Application of Trust Funds. i) On each Distribution
Date, the Servicer is obligated to instruct the Indenture Trustee to make
distributions and allocations in accordance with Section 5.061.(2) of the
Sale and Servicing Agreement. Distributions to Certificateholders will be
made in accordance with Section 5.061. of the Sale and Servicing Agreement.
(b) [Reserved].
(c) In the event that any withholding tax is imposed on the Trust's
payment (or allocations of income) to an Owner, such tax shall reduce the
amount otherwise distributable to
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the Owner in accordance with this Section. The Paying Agent is hereby
authorized and directed to retain from amounts otherwise distributable to the
Owners sufficient funds for the payment of any tax that is legally owed by
the Trust (but such authorization shall not prevent the Owner Trustee from
contesting any such tax in appropriate proceedings and withholding payment of
such tax, if permitted by law, pending the outcome of such proceedings). The
amount of any withholding tax imposed with respect to an Owner shall be
treated as cash distributed to such Owner at the time it is withheld by the
Trust and remitted to the appropriate taxing authority. If there is a
possibility that withholding tax is payable with respect to a distribution
(such as a distribution to a non-U.S. Owner), the Paying Agent may in its
sole discretion withhold such amounts in accordance with this paragraph.
SECTION 5.03. Method of Payment. Subject to Section 9.01(c),
distributions required to be made to Certificateholders on any Distribution
Date shall be made by the Paying Agent to each Certificateholder of record on
the preceding Record Date 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 shall have provided to the
Certificate Registrar appropriate written instructions at least five Business
Days prior to such Distribution Date, or, if not, by check mailed to such
Certificateholder at the address of such Holder appearing in the Certificate
Register.
SECTION 5.04. [Reserved]
SECTION 5.05. Accounting and Reports to Owners, Internal Revenue
Service and Others. The Owner Trustee shall deliver to each Owner such
information, reports or statements as may be required by the Code and
applicable Treasury Regulations and as may be required to enable each Owner
to prepare its federal and state income tax returns. Consistent with the
Trust's characterization for tax purposes, as a security arrangement for the
issuance of non-recourse debt, no federal income tax return shall be filed on
behalf of the Trust unless either (i) the Owner Trustee shall receive an
Opinion of Counsel that, based on a change in applicable law occurring after
the date hereof, or as a result of a transfer by the Company permitted by
Section 3.04, the Code requires such a filing or (ii) the Internal Revenue
Service shall determine that the Trust is required to file such a return.
Notwithstanding the preceding sentence, the Owner Trustee shall file Internal
Revenue Service Form 8832 and elect for the Trust to be treated as a domestic
eligible entity with a single owner that is disregarded as a separate entity,
which election shall remain in effect so long as the Company or any other
party is the sole Owner. In the event that the Trust is required to file tax
returns, the Owner Trustee shall prepare or shall cause to be prepared any
tax returns required to be filed by the Trust and shall remit such returns to
the Company (or if the Company no longer owns any Certificates, the Owner
designated for such purpose by the Company to the Owner Trustee in writing)
at least five (5) days before such returns are due to be filed. The Company
(or such designee Owner, as applicable) shall promptly sign such returns and
deliver such returns after signature to the Owner Trustee and such returns
shall be filed by the Owner Trustee with the appropriate tax authorities. In
no event shall the Owner Trustee or the Company (or such designee Owner, as
applicable) be liable for any liabilities, costs or expenses of the Trust or
the Noteholders arising out of the application of any tax law, including
federal, state, foreign or local income or excise taxes or any other tax
imposed on or measured by income (or any interest, penalty or addition with
respect thereto or arising
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from a failure to comply therewith) except for any such liability, cost or
expense attributable to any act or omission by the Owner Trustee or the
Company (or such designee Owner, as applicable), as the case may be, in
breach of its obligations under this Agreement.
ARTICLE VI
Authority and Duties of Owner Trustee
SECTION 6.01. General Authority. The Owner Trustee is authorized and
directed to execute and deliver the Basic Documents to which the Trust is to
be a party and each certificate or other document attached as an exhibit to
or contemplated by the Basic Documents to which the Trust is to be a party
and any amendment or other agreement or instrument described in Section 3.11,
in each case, in such form as the Company shall approve, as evidenced
conclusively by the Owner Trustee's execution thereof. In addition to the
foregoing, the Owner Trustee is authorized, but shall not be obligated, to
take all actions required of the Trust pursuant to the Basic Documents. The
Owner Trustee is further authorized from time to time to take such action as
the Administrator recommends with respect to the Basic Documents.
SECTION 6.02. General Duties. It shall be the duty of the Owner
Trustee to discharge (or cause to be discharged) all of its responsibilities
pursuant to the terms of this Agreement and the Basic Documents to which the
Trust is a party and to administer the Trust in the interest of the Owners,
subject to the Basic Documents and in accordance with the provisions of this
Agreement. Notwithstanding the foregoing, the Owner Trustee shall be deemed
to have discharged its duties and responsibilities hereunder and under the
Basic Documents to the extent the Administrator has agreed in the
Administration Agreement to perform any act or to discharge any duty of the
Owner Trustee hereunder or under any Basic Document, and the Owner Trustee
shall not be held liable for the default or failure of the Administrator to
carry out its obligations under the Administration Agreement.
SECTION 6.03. Action upon Instruction. i) Subject to Article IV and
in accordance with the terms of the Basic Documents, the Owners may by
written instruction direct the Owner Trustee in the management of the Trust.
Such direction may be exercised at any time by written instruction of the
Owners pursuant to Article IV.
(b) The Owner Trustee shall not be required to take any action
hereunder or under any Basic Document if the Owner Trustee shall have
reasonably determined, or shall have been advised by counsel, that such
action is likely to result in liability on the part of the Owner Trustee or
is contrary to the terms hereof or of any Basic Document or is otherwise
contrary to law.
(c) Whenever the Owner Trustee is unable to decide between
alternative courses of action permitted or required by the terms of this
Agreement or under any Basic Document, the Owner Trustee shall promptly give
notice (in such form as shall be appropriate under the circumstances) to the
Owners requesting instruction as to the course of action to be adopted, and
to the extent the Owner Trustee acts in good faith in accordance with any
written instruction of the Owners received, the Owner Trustee shall not be
liable on account of such action to any
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Person. If the Owner Trustee shall not have received appropriate instruction
within 10 days of such notice (or within such shorter period of time as
reasonably may be specified in such notice or may be necessary under the
circumstances) it may, but shall be under no duty to, take or refrain from
taking such action not inconsistent with this Agreement or the Basic
Documents, as it shall deem to be in the best interests of the Owners, and
shall have no liability to any Person for such action or inaction.
(d) In the event that the Owner Trustee is unsure as to the
application of any provision of this Agreement or any Basic Document or any
such provision is ambiguous as to its application, or is, or appears to be,
in conflict with any other applicable provision, or in the event that this
Agreement permits any determination by the Owner Trustee or is silent or is
incomplete as to the course of action that the Owner Trustee is required to
take with respect to a particular set of facts, the Owner Trustee may give
notice (in such form as shall be appropriate under the circumstances) to the
Owners requesting instruction and, to the extent that the Owner Trustee acts
or refrains from acting in good faith in accordance with any such instruction
received, the Owner Trustee shall not be liable, on account of such action or
inaction, to any Person. If the Owner Trustee shall not have received
appropriate instruction within 10 days of such notice (or within such shorter
period of time as reasonably may be specified in such notice or may be
necessary under the circumstances) it may, but shall be under no duty to,
take or refrain from taking such action not inconsistent with this Agreement
or the Basic Documents, as it shall deem to be in the best interests of the
Owners, and shall have no liability to any Person for such action or
inaction.
SECTION 6.04. No Duties Except as Specified in this Agreement or in
Instructions. The Owner Trustee shall not have any duty or obligation to
manage, make any payment with respect to, register, record, sell, dispose of,
or otherwise deal with the Owner Trust Estate, or to otherwise take or
refrain from taking any action under, or in connection with, any document
contemplated hereby to which the Owner Trustee is a party, except as
expressly provided by the terms of this Agreement or in any document or
written instruction received by the Owner Trustee pursuant to Section 6.03;
and no implied duties or obligations shall be read into this Agreement or any
Basic Document against the Owner Trustee. The Owner Trustee shall have no
responsibility for filing any financing or continuation statement in any
public office at any time or to otherwise perfect or maintain the perfection
of any security interest or lien granted to it hereunder or to prepare or
file any Securities and Exchange Commission filing for the Trust or to record
this Agreement or any Basic Document. The Owner Trustee nevertheless agrees
that it will, at its own cost and expense, promptly take all action as may be
necessary to discharge any liens on any part of the Owner Trust Estate that
result from actions by, or claims against, the Owner Trustee that are not
related to the ownership or the administration of the Owner Trust Estate.
SECTION 6.05. No Action Except Under Specified Documents or
Instructions. The Owner Trustee shall not manage, control, use, sell, dispose
of or otherwise deal with any part of the Owner Trust Estate except (i) in
accordance with the powers granted to and the authority conferred upon the
Owner Trustee pursuant to this Agreement, (ii) in accordance with the Basic
Documents and (iii) in accordance with any document or instruction delivered
to the Owner Trustee pursuant to Section 6.03.
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SECTION 6.06. Restrictions. The Owner Trustee shall not take any
action i) that is inconsistent with the purposes of the Trust set forth in
Section 2.03 or (b) that, to the actual knowledge of the Owner Trustee, would
result in the Trust's becoming taxable as a corporation for federal income
tax purposes. The Owners shall not direct the Owner Trustee to take action
that would violate the provisions of this Section.
ARTICLE VII
Concerning Owner Trustee
SECTION 7.01. Acceptance of Trusts and Duties. The Owner Trustee
accepts the trusts hereby created and agrees to perform its duties hereunder
with respect to such trusts, but only upon the terms of this Agreement. The
Owner Trustee also agrees to disburse all moneys actually received by it
constituting part of the Owner Trust Estate upon the terms of the Basic
Documents and this Agreement. The Owner Trustee shall not be answerable or
accountable hereunder or under any Basic Document under any circumstances,
except (i) for its own willful misconduct or negligence or (ii) in the case
of the inaccuracy of any representation or warranty contained in Section 7.03
expressly made by the Owner Trustee. In particular, but not by way of
limitation (and subject to the exceptions set forth in the preceding
sentence):
(a) The Owner Trustee shall not be liable for any error of judgment
made in good faith by the Owner Trustee;
(b) The Owner Trustee shall not be liable with respect to any action
taken or omitted to be taken by it in accordance with the instructions of the
Administrator or any Owner;
(c) No provision of this Agreement or any Basic Document shall
require the Owner Trustee to expend or risk funds or otherwise incur any
financial liability in the performance of any of its rights or powers
hereunder or under any Basic Document if the Owner Trustee shall have
reasonable grounds for believing that repayment of such funds or adequate
indemnity against such risk or liability is not reasonably assured or
provided to it;
(d) Under no circumstances shall the Owner Trustee be liable for
indebtedness evidenced by or arising under any of the Basic Documents,
including the principal of and interest on the Notes or any amounts payable
on the Certificates;
(e) The Owner Trustee shall not be responsible for or in respect of
the validity or sufficiency of this Agreement or for the due execution hereof
by the Depositor or the Company or for the form, character, genuineness,
sufficiency, value or validity of any of the Owner Trust Estate, or for or in
respect of the validity or sufficiency of the Basic Documents, other than the
certificate of authentication on the Certificates, and the Owner Trustee
shall in no event assume or incur any liability, duty or obligation to any
Noteholder or to any Owner, other than as expressly provided for herein or
expressly agreed to in the Basic Documents;
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(f) The Owner Trustee shall not be liable for the default or
misconduct of the Administrator, CFC, as Seller or Depositor, the Company,
the Indenture Trustee or the Servicer under any of the Basic Documents or
otherwise, and the Owner Trustee shall have no obligation or liability to
perform the obligations of the Trust under this Agreement or the Basic
Documents that are required to be performed by the Administrator under the
Administration Agreement, the Indenture Trustee under the Indenture or the
Servicer or CFC, as Depositor or as Seller, under the Sale and Servicing
Agreement; and
(g) The Owner 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 otherwise or in
relation to this Agreement or any Basic Document, at the request, order or
direction of any of the Owners, unless such Owners have offered to the Owner
Trustee security or indemnity satisfactory to it against the costs, expenses
and liabilities that may be incurred by the Owner Trustee therein or thereby.
The right of the Owner Trustee to perform any discretionary act enumerated in
this Agreement or in any Basic Document shall not be construed as a duty, and
the Owner Trustee shall not be answerable for other than its negligence or
willful misconduct in the performance of any such act.
SECTION 7.02. Furnishing of Documents. The Owner Trustee shall
furnish to the Owners, promptly upon receipt of a written request therefor,
duplicates or copies of all reports, notices, requests, demands,
certificates, financial statements and any other instruments furnished to the
Owner Trustee under the Basic Documents.
SECTION 7.03. Representations and Warranties. The Owner Trustee
hereby represents and warrants to the Company, for the benefit of the Owners,
that:
(a) It is a banking corporation duly organized and validly existing
in good standing under the laws of the State of Delaware. It has all
requisite corporate power and authority to execute, deliver and perform its
obligations under this Agreement.
(b) It has taken all corporate action necessary to authorize the
execution and delivery by it of this Agreement, and this Agreement will be
executed and delivered by one of its officers who is duly authorized to
execute and deliver this Agreement on its behalf.
(c) Neither the execution or the delivery by it of this Agreement,
nor the consummation by it of the transactions contemplated hereby, nor
compliance by it with any of the terms or provisions hereof will contravene
any federal or Delaware law, governmental rule or regulation governing the
banking or trust powers of the Owner Trustee or any judgment or order binding
on it, or constitute any default under its charter documents or bylaws or any
indenture, mortgage, contract, agreement or instrument to which it is a party
or by which any of its properties may be bound.
SECTION 7.04. Reliance; Advice of Counsel. i) The Owner Trustee
shall incur no liability to anyone in acting upon any signature, instrument,
notice, resolution, request, consent, order, certificate, report, opinion,
bond, or other document or paper believed by it to be genuine and believed by
it to be signed by the proper party or parties. The Owner Trustee may accept
a
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certified copy of a resolution of the board of directors or other governing
body of any corporate party as conclusive evidence that such resolution has
been duly adopted by such body and that the same is in full force and effect.
As to any fact or matter the method of determination of which is not
specifically prescribed herein, the Owner Trustee may for all purposes hereof
rely on a certificate, signed by the president or any vice president or by
the treasurer or other authorized officers of the relevant party, as to such
fact or matter, and such certificate shall constitute full protection to the
Owner Trustee for any action taken or omitted to be taken by it in good faith
in reliance thereon.
(b) In the exercise or administration of the trusts hereunder and in
the performance of its duties and obligations under this Agreement or the
Basic Documents, the Owner Trustee (1) may act directly or through its agents
or attorneys pursuant to agreements entered into with any of them, and the
Owner Trustee shall not be liable for the conduct or misconduct of such
agents or attorneys if such agents or attorneys shall have been selected by
the Owner Trustee with reasonable care, and (ii) may consult with counsel,
accountants and other skilled Persons to be selected with reasonable care and
employed by it. The Owner Trustee shall not be liable for anything done,
suffered or omitted in good faith by it in accordance with the written
opinion or advice of any such counsel, accountants or other such Persons and
not contrary to this Agreement or any Basic Document.
SECTION 7.05. Not Acting in Individual Capacity. Except as provided
in this Article VII, in accepting the trusts hereby created Chase Manhattan
Bank Delaware acts solely as Owner Trustee hereunder and not in its
individual capacity, and all Persons having any claim against the Owner
Trustee by reason of the transactions contemplated by this Agreement or any
Basic Document shall look only to the Owner Trust Estate for payment or
satisfaction thereof.
SECTION 7.06. Owner Trustee Not Liable for Certificates or
Receivables. The recitals contained herein and in the Certificates (other
than the signature and countersignature of the Owner Trustee on the
Certificates) shall be taken as the statements of the Depositor and the
Company, and the Owner Trustee assumes no responsibility for the correctness
thereof. The Owner Trustee makes no representations as to the validity or
sufficiency of this Agreement, of any Basic Document or of the Certificates
(other than the signature and countersignature of the Owner Trustee on the
Certificates) or the Notes, or of any Receivable or related documents. The
Owner Trustee shall at no time have any responsibility or liability for or
with respect to the legality, validity and enforceability of any Receivable,
or the perfection and priority of any security interest created by any
Receivable in any Financed Vehicle or the maintenance of any such perfection
and priority, or for or with respect to the sufficiency of the Owner Trust
Estate or its ability to generate the payments to be distributed to
Certificateholders under this Agreement or the Noteholders under the
Indenture, including, without limitation: the existence, condition and
ownership of any Financed Vehicle; the existence and enforceability of any
insurance thereon; the existence and contents of any Receivable on any
computer or other record thereof; the validity of the assignment of any
Receivable to the Trust or of any intervening assignment; the completeness of
any Receivable; the performance or enforcement of any Receivable; the
compliance by the Depositor, the Company or the Servicer with any warranty or
representation made under any Basic Document or in any related document or
the accuracy of any such
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warranty or representation, or any action of the Administrator, the Indenture
Trustee or the Servicer or any subservicer taken in the name of the Owner
Trustee.
SECTION 7.07. Owner Trustee May Own Certificates and Notes. The
Owner Trustee in its individual or any other capacity may become the owner or
pledgee of Certificates or Notes and may deal with the Depositor, the
Company, the Administrator, the Indenture Trustee and the Servicer in banking
transactions with the same rights as it would have if it were not Owner
Trustee.
SECTION 7.08. Pennsylvania Motor Vehicle Sales Finance Act Licenses.
The Owner Trustee, in its individual capacity, shall use its best efforts to
maintain, and the Owner Trustee, as Owner Trustee, shall cause the Trust to
use its best efforts to maintain, the effectiveness of all licenses required
under the Pennsylvania Motor Vehicle Sales Finance Act in connection with
this Agreement and the Basic Documents and the transactions contemplated
hereby and thereby until such time as the Trust shall terminate in accordance
with the terms hereof.
ARTICLE VIII
Compensation of Owner Trustee
SECTION 8.01. Owner Trustee's Fees and Expenses. The Owner Trustee
shall receive as compensation for its services hereunder such fees as have
been separately agreed upon before the date hereof between the Depositor and
the Owner Trustee, and the Owner Trustee shall be entitled to be reimbursed
by the Depositor for its other reasonable expenses hereunder, including the
reasonable compensation, expenses and disbursements of such agents,
representatives, experts and counsel as the Owner Trustee may employ in
connection with the exercise and performance of its rights and its duties
hereunder.
SECTION 8.02. Indemnification. The Depositor shall be liable as
primary obligor for, and shall indemnify the Owner Trustee and its
successors, assigns, agents and servants (collectively, the "Indemnified
Parties") from and against, any and all liabilities, obligations, losses,
damages, taxes, claims, actions and suits, and any and all reasonable costs,
expenses and disbursements (including reasonable legal fees and expenses) of
any kind and nature whatsoever (collectively, "Expenses") which may at any
time be imposed on, incurred by, or asserted against the Owner Trustee or any
Indemnified Party in any way relating to or arising out of this Agreement,
the Basic Documents, the Owner Trust Estate, the administration of the Owner
Trust Estate or the action or inaction of the Owner Trustee hereunder, except
only that the Depositor shall not be liable for or required to indemnify an
Indemnified Party from and against Expenses arising or resulting from any of
the matters described in the third sentence of Section 7.01. The indemnities
contained in this Section shall survive the resignation or termination of the
Owner Trustee or the termination of this Agreement. In any event of any
claim, action or proceeding for which indemnity will be sought pursuant to
this Section, the Owner Trustee's choice of legal counsel shall be subject to
the approval of the Depositor, which approval shall not be unreasonably
withheld.
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SECTION 8.03. Payments to Owner Trustee. Any amounts paid to the
Owner Trustee pursuant to this Article VIII shall be deemed not to be a part
of the Owner Trust Estate immediately after such payment.
ARTICLE IX
Termination of Trust Agreement
SECTION 9.01. Termination of Trust Agreement. i) This Agreement
(other than Article VIII) and the Trust shall terminate and be of no further
force or effect upon the final distribution by the Owner Trustee of all
moneys or other property or proceeds of the Owner Trust Estate in accordance
with the terms of the Indenture, the Sale and Servicing Agreement and Article
V. The bankruptcy, liquidation, dissolution, death or incapacity of any Owner
shall not (x) operate to terminate this Agreement or the Trust or (y) entitle
such Owner's legal representatives or heirs to claim an accounting or to take
any action or proceeding in any court for a partition or winding up of all or
any part of the Trust or Owner Trust Estate or (z) otherwise affect the
rights, obligations and liabilities of the parties hereto.
(b) Except as provided in Section 9.01(a), none of the Depositor,
the Company or any Owner shall be entitled to revoke or terminate the Trust.
(c) Notice of any termination of the Trust, specifying the
Distribution Date upon which Certificateholders shall surrender their
Certificates to the Paying Agent for payment of the final distribution and
cancellation, shall be given by the Owner Trustee by letter to
Certificateholders mailed within five Business Days of receipt of notice of
such termination from the Servicer given pursuant to Section 9.01(c) of the
Sale and Servicing Agreement, stating (i) the Distribution Date upon or with
respect to which final payment of the Certificates shall be made upon
presentation and surrender of the Certificates at the office of the Paying
Agent therein designated, (ii) the amount of any such final payment and (iii)
that the Record Date otherwise applicable to such Distribution Date is not
applicable, payments being made only upon presentation and surrender of the
Certificates at the office of the Paying Agent therein specified. The Owner
Trustee shall give such notice to the Certificate Registrar (if other than
the Owner Trustee) and the Paying Agent at the time such notice is given to
Certificateholders. Upon presentation and surrender of the Certificates, the
Paying Agent shall cause to be distributed to Certificateholders amounts
distributable on such Distribution Date pursuant to Section 5.02.
In the event that all of the Certificateholders shall not surrender
their Certificates for cancellation within six months after the date
specified in the above mentioned written notice, the Owner 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 all the
Certificates shall not have been surrendered for cancellation, the Owner
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
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subject to this Agreement. Subject to applicable escheat laws, any funds
remaining in the Trust after exhaustion of such remedies shall be distributed
by the Paying Agent to the Company.
(d) Upon the winding up of the Trust and its termination, the Owner
Trustee shall cause the Certificate of Trust to be cancelled by filing a
certificate of cancellation with the Secretary of State in accordance with
the provisions of Section 3810 of the Business Trust Statute.
ARTICLE X
Successor Owner Trustees and Additional Owner Trustees
SECTION 10.01. Eligibility Requirements for Owner Trustee. The Owner
Trustee shall at all times be a corporation satisfying the provisions of
Section 3807(a) of the Business Trust Statute; authorized to exercise
corporate trust powers; having a combined capital and surplus of at least
$50,000,000 and subject to supervision or examination by federal or state
authorities; and having (or having a parent that has) time deposits that are
rated at least A-1 by Standard & Poor's and P-1 by Moody's. 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, 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. In
case at any time the Owner Trustee shall cease to be eligible in accordance
with the provisions of this Section, the Owner Trustee shall resign
immediately in the manner and with the effect specified in Section 10.02.
SECTION 10.02. Resignation or Removal of Owner Trustee. The Owner
Trustee may at any time resign and be discharged from the trusts hereby
created by giving written notice thereof to the Administrator. Upon receiving
such notice of resignation, the Administrator shall promptly appoint a
successor Owner Trustee by written instrument, in duplicate, one copy of
which instrument shall be delivered to the resigning Owner Trustee and one
copy to the successor Owner Trustee. If no successor Owner Trustee shall have
been so appointed and have accepted appointment within 30 days after the
giving of such notice of resignation, the resigning Owner Trustee may
petition any court of competent jurisdiction for the appointment of a
successor Owner Trustee.
If at any time the Owner Trustee shall cease to be eligible in
accordance with the provisions of Section 10.01 and shall fail to resign
after written request therefor by the Administrator, or if at any time the
Owner Trustee shall be legally unable to act, or shall be adjudged bankrupt
or insolvent, or a receiver of the Owner Trustee or of its property shall be
appointed, or any public officer shall take charge or control of the Owner
Trustee or of its property or affairs for the purpose of rehabilitation,
conservation or liquidation, then the Administrator may remove the Owner
Trustee. If the Administrator shall remove the Owner Trustee under the
authority of the immediately preceding sentence, the Administrator shall
promptly appoint a successor Owner Trustee by written instrument, in
duplicate, one copy of
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which instrument shall be delivered to the outgoing Owner Trustee so removed
and one copy to the successor Owner Trustee, and shall pay all fees owed to
the outgoing Owner Trustee.
Any resignation or removal of the Owner Trustee and appointment of a
successor Owner Trustee pursuant to any of the provisions of this Section
shall not become effective until acceptance of appointment by the successor
Owner Trustee pursuant to Section 10.03 and payment of all fees and expenses
owed to the outgoing Owner Trustee. The Administrator shall provide notice of
such resignation or removal of the Owner Trustee to each of the Rating
Agencies.
SECTION 10.03. Successor Owner Trustee. Any successor Owner Trustee
appointed pursuant to Section 10.02 shall execute, acknowledge and deliver to
the Administrator and to its predecessor Owner Trustee an instrument
accepting such appointment under this Agreement, and thereupon the
resignation or removal of the predecessor Owner Trustee shall become
effective, and such successor Owner 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 Owner Trustee. The predecessor Owner Trustee shall upon
payment of its fees and expenses deliver to the successor Owner Trustee all
documents and statements and monies held by it under this Agreement; and the
Administrator and the predecessor Owner 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 Owner Trustee all
such rights, powers, duties and obligations.
No successor Owner Trustee shall accept appointment as provided in
this Section unless at the time of such acceptance such successor Owner
Trustee shall be eligible pursuant to Section 10.01.
Upon acceptance of appointment by a successor Owner Trustee pursuant
to this Section, the Administrator shall mail notice thereof to all
Certificateholders, the Indenture Trustee, the Noteholders and the Rating
Agencies. If the Administrator shall fail to mail such notice within 10 days
after acceptance of such appointment by the successor Owner Trustee, the
successor Owner Trustee shall cause such notice to be mailed at the expense
of the Administrator.
SECTION 10.04. Merger or Consolidation of Owner Trustee. Any
corporation into which the Owner 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 Owner Trustee shall be a party, or
any corporation succeeding to all or substantially all of the corporate trust
business of the Owner Trustee, shall be the successor of the Owner Trustee
hereunder, 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; provided, that such corporation shall be eligible pursuant
to Section 10.01 and, provided, further, that the Owner Trustee shall mail
notice of such merger or consolidation to the Rating Agencies.
SECTION 10.05. 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 Owner Trust Estate or any Financed
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Vehicle may at the time be located, the Administrator and the Owner Trustee
acting jointly shall have the power and shall execute and deliver all
instruments to appoint one or more Persons approved by the Administrator and
Owner Trustee to act as co-trustee, jointly with the Owner Trustee, or as
separate trustee or separate trustees, of all or any part of the Owner Trust
Estate, and to vest in such Person, in such capacity, such title to the Trust
or any part thereof and, subject to the other provisions of this Section,
such powers, duties, obligations, rights and trusts as the Administrator and
the Owner Trustee may consider necessary or desirable. If the Administrator
shall not have joined in such appointment within 15 days after the receipt by
it of a request so to do, the Owner 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 Owner
Trustee pursuant to Section 10.01 and no notice of the appointment of any
co-trustee or separate trustee shall be required pursuant to Section 10.03.
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 Owner Trustee shall be conferred upon and exercised or performed by
the Owner 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 Owner 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, the Owner 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 Owner Trust
Estate 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 Owner 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; and
(c) The Administrator and the Owner Trustee acting jointly may at
any time accept the resignation of or remove any separate trustee or
co-trustee.
Any notice, request or other writing given to the Owner 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. 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 Owner 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 Owner Trustee. Each such instrument shall be
filed with the Owner Trustee and a copy thereof given to the Administrator.
Any separate trustee or co-trustee may at any time appoint the Owner
Trustee as its agent or attorney-in-fact with full power and authority, to
the extent not prohibited by law, to do any
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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 Owner Trustee, to
the extent permitted by law, without the appointment of a new or successor
co-trustee or separate trustee.
ARTICLE XI
Miscellaneous
SECTION 11.01. Supplements and Amendments. This Agreement may be
amended by the Depositor, the Company and the Owner Trustee, with prior
written notice to the Rating Agencies, without the consent of any of the
Noteholders or the Certificateholders, to cure any ambiguity, to correct or
supplement any provisions in this Agreement or for the purpose of adding any
provisions to or changing in any manner or eliminating any of the provisions
in this Agreement (including for the issuance of Fixed Value Securities
pursuant to Section 2.03 of the Sale and Servicing Agreement) or of modifying
in any manner the rights of the Noteholders or the Certificateholders;
provided, however, that such action shall not, as evidenced by an Opinion of
Counsel, adversely affect in any material respect the interests of any
Noteholder or Certificateholder.
This Agreement may also be amended from time to time by the
Depositor, the Company and the Owner Trustee, with prior written notice to
the Rating Agencies, with the consent of the Holders (as defined in the
Indenture) of Notes evidencing not less than a majority of the Outstanding
Amount of the Notes, the consent of the Holders of Trust Certificates
evidencing not less than a majority of the Percentage Interests evidenced by
the Trust Certificates and the consent of the Holders of
Overcollateralization Certificates evidencing not less than a majority of the
Certificate Balance, for the purpose of adding any provisions to or changing
in any manner or eliminating any of the provisions of this Agreement or of
modifying in any manner the rights of the Noteholders or the
Certificateholders; provided, however, that no such amendment shall (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 for the benefit of the Noteholders or the
Certificateholders or (b) reduce the aforesaid percentage of the Outstanding
Amount of the Notes or of the Percentage Interests evidenced by the Trust
Certificates or of the principal amount of the Certificate Balance with
respect to the Overcollateralization Certificates required to consent to any
such amendment, without the consent of the Holders of all the outstanding
Notes, Trust Certificates and Overcollateralization Certificates.
Promptly after the execution of any such amendment or consent, the
Owner Trustee shall furnish written notification of the substance of such
amendment or consent to each Certificateholder, the Indenture Trustee and
each of the Rating Agencies.
It shall not be necessary for the consent of Certificateholders,
Noteholders or the Indenture Trustee pursuant to this Section to approve the
particular form of any proposed
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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 or in any
other Basic Document) and of evidencing the authorization of the execution
thereof by Certificateholders shall be subject to such reasonable
requirements as the Owner Trustee may prescribe.
Promptly after the execution of any amendment to the Certificate of
Trust, the Owner Trustee shall cause the filing of such amendment with the
Secretary of State.
Prior to the execution of any amendment to this Agreement or the
Certificate of Trust, the Owner Trustee shall be entitled to receive and rely
upon an Opinion of Counsel stating that the execution of such amendment is
authorized or permitted by this Agreement. The Owner Trustee may, but shall
not be obligated to, enter into any such amendment that affects the Owner
Trustee's own rights, duties or immunities under this Agreement or otherwise.
In connection with the execution of any amendment to this Agreement
or any amendment of any other agreement to which the Issuer is a party, the
Owner Trustee shall be entitled to receive and conclusively rely upon an
Opinion of Counsel to the effect that such amendment is authorized or
permitted by the Basic Documents and that all conditions precedent in the
Basic Documents for the execution and delivery thereof by the Issuer or the
Owner Trustee, as the case may be, have been satisfied.
SECTION 11.02. No Legal Title to Owner Trust Estate in Owners. The
Owners shall not have legal title to any part of the Owner Trust Estate. The
Owners shall be entitled to receive distributions with respect to their
undivided ownership interest therein only in accordance with Articles V and
IX. No transfer, by operation of law or otherwise, of any right, title or
interest of the Owners to and in their ownership interest in the Owner Trust
Estate shall operate to terminate this Agreement or the trusts hereunder or
entitle any transferee to an accounting or to the transfer to it of legal
title to any part of the Owner Trust Estate.
SECTION 11.03. Limitations on Rights of Others. The provisions of
this Agreement are solely for the benefit of the Owner Trustee, the
Depositor, the Company, the Owners, the Administrator and, to the extent
expressly provided herein, the Indenture Trustee and the Noteholders, and
nothing in this Agreement, whether express or implied, shall be construed to
give to any other Person any legal or equitable right, remedy or claim in the
Owner Trust Estate or under or in respect of this Agreement or any covenants,
conditions or provisions contained herein.
SECTION 11.04. Notices. i) Unless otherwise expressly specified or
permitted by the terms hereof, all notices shall be in writing and shall be
deemed given upon receipt by the intended recipient or three Business Days
after mailing if mailed by certified mail, postage prepaid (except that
notice to the Owner Trustee shall be deemed given only upon actual receipt by
the Owner Trustee), if to the Owner Trustee, addressed to the Corporate Trust
Office; if to the Depositor, addressed to Chrysler Financial Corporation,
27777 Franklin Road, Southfield, Michigan 48034, Attention of Assistant
Secretary; if to the Company, addressed to Premier Receivables L.L.C., 27777
Franklin Road, Southfield, Michigan 48034, Attention of Assistant
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Secretary; or, as to each party, at such other address as shall be designated
by such party in a written notice to each other party.
(b) Any notice required or permitted to be given 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
receives such notice.
SECTION 11.05. Severability. Any provision of this Agreement that is
prohibited or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof, and
any such prohibition or unenforceability in any jurisdiction shall not
invalidate or render unenforceable such provision in any other jurisdiction.
SECTION 11.06. Separate Counterparts. This Agreement may be executed
by the parties hereto in separate counterparts, each of which when so
executed and delivered shall be an original, but all such counterparts shall
together constitute but one and the same instrument.
SECTION 11.07. Successors and Assigns. All covenants and agreements
contained herein shall be binding upon, and inure to the benefit of, each of
the Depositor, the Company and its permitted assignees, the Owner Trustee and
its successors and each Owner and its successors and permitted assigns, all
as herein provided. Any request, notice, direction, consent, waiver or other
instrument or action by an Owner shall bind the successors and assigns of
such Owner.
SECTION 11.08. Covenants of Company. In the event that any
litigation with claims in excess of $1,000,000 to which the Company is a
party which shall be reasonably likely to result in a material judgment
against the Company that the Company will not be able to satisfy shall be
commenced by an Owner, during the period beginning nine months following the
commencement of such litigation and continuing until such litigation is
dismissed or otherwise terminated (and, if such litigation has resulted in a
final judgment against the Company, such judgment has been satisfied), the
Company shall not make any distribution on or in respect of its membership
interests to any of its members, or repay the principal amount of any
indebtedness of the Company held by CFC, unless (i) after giving effect to
such distribution or repayment, the Company's liquid assets shall not be less
than the amount of actual damages claimed in such litigation or (ii) the
Rating Agency Condition shall have been satisfied with respect to any such
distribution or repayment. The Company will not at any time institute against
the Trust any bankruptcy proceedings under any United States federal or state
bankruptcy or similar law in connection with any obligations relating to the
Certificates, the Notes, this Agreement or any of the Basic Documents.
SECTION 11.09. No Petition. The Owner Trustee, by entering into this
Agreement, each Certificateholder, by accepting a Certificate, and the
Indenture Trustee and each Noteholder, by accepting the benefits of this
Agreement, hereby covenant and agree that they will not at any time institute
against the Company or the Trust, or join in any institution against the
Company or the Trust of, any bankruptcy proceedings under any United States
federal or
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state bankruptcy or similar law in connection with any obligations relating
to the Certificates, the Notes, this Agreement or any of the Basic Documents.
SECTION 11.10. No Recourse. Each Certificateholder by accepting a
Certificate acknowledges that such Certificateholder's Certificates represent
beneficial interests in the Trust only and do not represent interests in or
obligations of the Depositor, the Servicer, the Company, the Administrator,
the Owner Trustee, the Indenture Trustee or any Affiliate thereof and no
recourse may be had against such parties or their assets, except as may be
expressly set forth or contemplated in this Agreement, the Certificates or
the Basic Documents.
SECTION 11.11. Headings. The headings of the various Articles and
Sections herein are for convenience of reference only and shall not define or
limit any of the terms or provisions hereof.
SECTION 11.12. GOVERNING LAW. THIS AGREEMENT SHALL BE CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF DELAWARE, WITHOUT REFERENCE TO ITS
CONFLICT OF LAW PROVISIONS, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE
PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
SECTION 11.13. Certificate Transfer Restrictions. The Certificates
may not be acquired by or for the account of (i) an employee benefit plan (as
defined in Section 3(3) of ERISA) that is subject to the provisions of Title
I of ERISA, (ii) a plan described in Section 4975(e)(1) of the Code or (iii)
any entity whose underlying assets include plan assets by reason of a plan's
investment in the entity (each, a "Benefit Plan"). By accepting and holding a
Certificate, the Holder thereof shall be deemed to have represented and
warranted that it is not a Benefit Plan.
SECTION 11.14. Depositor Payment Obligation. The Depositor shall be
responsible for payment of the Administrator's fees under the Administration
Agreement and shall reimburse the Administrator for all expenses and
liabilities of the Administrator incurred thereunder. In addition, the
Depositor shall be responsible for the payment of all fees and expenses of
the Trust, the Owner Trustee and the Indenture Trustee paid by any of them in
connection with any of their obligations under the Basic Documents to obtain
or maintain any required license under the Pennsylvania Motor Vehicle Sales
Finance Act.
30
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Amended and
Restated Trust Agreement to be duly executed by their respective officers
hereunto duly authorized, as of the day and year first above written.
CHRYSLER FINANCIAL CORPORATION, as Depositor
By: /s/ Dennis M. Cantwell
-----------------------------------
Name: Dennis M. Cantwell
Title: Vice President and Treasurer
PREMIER RECEIVABLES L.L.C.
By: Chrysler Financial Receivables Corporation,
as a Member
By: /s/ Dennis M. Cantwell
-----------------------------------
Name: Dennis M. Cantwell
Title: Vice President and Treasurer
CHASE MANHATTAN BANK DELAWARE,
not in its individual capacity but solely as
Owner Trustee
By: /s/ John J. Cashin
-----------------------------------
Name: John J. Cashin
Title: Vice President
31
<PAGE>
EXHIBIT A-1
Form of Trust Certificate
THIS CERTIFICATE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE "SECURITIES ACT"), OR ANY STATE SECURITIES LAWS, AND MAY NOT BE
OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED IN THE ABSENCE OF SUCH
REGISTRATION OR AN EXEMPTION THEREFROM. IN ADDITION, THE TRANSFER OF THIS
CERTIFICATE IS SUBJECT TO CERTAIN RESTRICTIONS AND CONDITIONS SET FORTH IN
SECTION 3.04 OF THE TRUST AGREEMENT UNDER WHICH THIS CERTIFICATE IS ISSUED (A
COPY OF WHICH TRUST AGREEMENT IS AVAILABLE FROM THE OWNER TRUSTEE OR UPON
REQUEST), INCLUDING RECEIPT BY THE OWNER TRUSTEE OF AN INVESTMENT LETTER IN
WHICH THE TRANSFEREE MAKES CERTAIN REPRESENTATIONS.
No. R-1 Percentage Interest: ____%
PREMIER AUTO TRUST 1998-5
TRUST CERTIFICATE
evidencing a fractional undivided interest in the Trust, as defined below,
the property of which includes a pool of retail installment sale contracts
and the Amortizing Payments on the Fixed Value Receivables (each as defined
herein) secured by new and used automobiles and light duty trucks.
(This Trust Certificate does not represent an interest in or obligation of
Chrysler Financial Corporation or any of its affiliates, except to the extent
described below.)
THIS CERTIFIES THAT ______________________________________. is the
registered owner of a __________________________________ PERCENT
nonassessable, fully-paid, undivided percentage interest in Premier Auto
Trust 1998-5 (the "Trust"), formed by Chrysler Financial Corporation, a
Michigan corporation (the "Depositor"), and Premier Receivables L.L.C., a
Michigan limited liability company (the "Company").
A-1-1
<PAGE>
OWNER TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Trust Certificates referred to in the within-mentioned
Trust Agreement.
CHASE MANHATTAN BANK DELAWARE,
CHASE MANHATTAN BANK DELAWARE, or as Owner Trustee
as Owner Trustee
by: THE CHASE MANHATTAN BANK,
as Authenticating Agent
by: ____________________________ by: ___________________________
Authorized Signatory Authorized Signatory
A-1-2
<PAGE>
The Trust was created pursuant to a Trust Agreement dated as of
October 1, 1998, as amended and restated by an Amended and Restated Trust
Agreement dated as of October 1, 1998 (as so amended and restated and further
amended or supplemented from time to time, the "Trust Agreement"), among the
Depositor, the Company and Chase Manhattan Bank Delaware, as owner trustee
(the "Owner 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 the Trust
Agreement or the Sale and Servicing Agreement dated as of October 1, 1998 (as
amended and supplemented from time to time, the "Sale and Servicing
Agreement"), between the Trust and the Depositor, as seller and as servicer
(in such capacity, the "Servicer"), as applicable.
This Trust Certificate is one of the duly authorized class of
certificates designated as "Trust Certificates" (herein called the "Trust
Certificates"). Also issued under the Trust Agreement is a duly authorized
class of certificates designated as "Overcollateralization Certificates" (the
"Overcollateralization Certificates" and, together with the Trust
Certificates, the "Certificates"). Also issued under an Indenture dated as of
October 1, 1998 (the "Indenture"), between the Trust and The First National
Bank of Chicago, as indenture trustee, are the four classes of Notes
designated as "Class A-1 5.14% Asset Backed Notes," "Class A-2 5.07% Asset
Backed Notes," "Class A-3 5.07% Asset Backed Notes" and "Class A-4 5.19%
Asset Backed Notes" (collectively, the "Notes"). This Trust Certificate is
issued under and is subject to the terms, provisions and conditions of the
Trust Agreement, to which Trust Agreement the Holder of this Trust
Certificate by virtue of its acceptance hereof assents and by which such
Holder is bound. The property of the Trust consists of a pool of retail
installment sale contracts for new and used automobiles and light duty trucks
and the Amortizing Payments on the Fixed Value Receivables (collectively, the
"Receivables"), all monies received on or after October 14, 1998, security
interests in the vehicles financed thereby, certain bank accounts and the
proceeds thereof, proceeds from claims on certain insurance policies and
certain other rights under the Trust Agreement and the Sale and Servicing
Agreement and all proceeds of the foregoing. The term "Fixed Value
Receivables" shall mean retail sale contracts secured by new automobiles or
light duty trucks with a series of fixed level payment monthly installments
(the "Amortizing Payments") and a final fixed value payment that is greater
than each Amortizing Payment. Distributions, if any, in respect of this Trust
Certificate will be made pursuant to Section 5.02 of the Trust Agreement.
It is the intent of the Depositor, the Company, the Servicer and the
Certificateholder that, for purposes of federal income, state and local
income and single business tax and any other income taxes, the Trust will be
treated as a security arrangement for the issuance of debt by the sole
Certificateholder. The Company, by acceptance of the Trust Certificates,
agrees to treat, and to take no action inconsistent with the above treatment
for so long as the Company is the sole Owner.
Solely in the event the Certificates are held by more than a single
Owner, it is the intent of the Depositor, the Company, the Servicer and the
Certificateholders that, for purposes of federal income, state and local
income and single business tax and any other income taxes, the Trust will be
treated as a partnership and the Certificateholders (including the Company)
will be treated as partners in the partnership. The Company and the other
Certificateholders, by
A-1-3
<PAGE>
acceptance of a Certificate, agree to treat, and to take no action
inconsistent with the Treatment of, the Certificates for such tax purposes as
partnership interests in the Trust.
Each Certificateholder, by its acceptance of a Certificate covenants
and agrees that such Certificateholder will not at any time institute against
the Company, or join in any institution against the Company of, any
bankruptcy, reorganization, arrangement, insolvency or liquidation
proceedings, or other proceedings under any United States federal or state
bankruptcy or similar law in connection with any obligations relating to the
Trust Certificates, the Notes, the Trust Agreement or any of the Basic
Documents.
Distributions on this Trust Certificate will be made as provided in
the Trust Agreement by the Paying Agent by wire transfer or check mailed to
the Certificateholder of record in the Certificate Register without the
presentation or surrender of this Trust Certificate or the making of any
notation hereon. Except as otherwise provided in the Trust Agreement and
notwithstanding the above, the final distribution on this Trust Certificate
will be made after due notice by the Owner Trustee of the pendency of such
distribution and only upon presentation and surrender of this Trust
Certificate at the office or agency maintained for that purpose by the Paying
Agent in the Borough of Manhattan, The City of New York.
Reference is hereby made to the further provisions of this Trust
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 Owner Trustee, by manual signature,
this Trust Certificate shall not entitle the Holder hereof to any benefit
under the Trust Agreement or the Sale and Servicing Agreement or be valid for
any purpose.
THIS TRUST CERTIFICATE SHALL BE CONSTRUED IN ACCORDANCE WITH THE
LAWS OF THE STATE OF DELAWARE, WITHOUT REFERENCE TO ITS CONFLICT OF LAW
PROVISIONS, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER
SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
A-1-4
<PAGE>
IN WITNESS WHEREOF, the Owner Trustee, on behalf of the Trust and
not in its individual capacity, has caused this Trust Certificate to be duly
executed.
PREMIER AUTO TRUST 1998-5
by: CHASE MANHATTAN BANK DELAWARE,
not in its individual
capacity but solely as Owner Trustee
Dated: _________________ by: _____________________________________
Authorized Signatory
A-1-5
<PAGE>
[REVERSE OF TRUST CERTIFICATE]
The Trust Certificates do not represent an obligation of, or an
interest in, the Depositor, the Servicer, the Company, the Owner Trustee or
any affiliates of any of them and no recourse may be had against such parties
or their assets, except as expressly set forth or contemplated herein or in
the Trust Agreement or the Basic Documents. In addition, this Trust
Certificate is not guaranteed by any governmental agency or instrumentality
and is limited in right of payment to certain collections and recoveries with
respect to the Receivables (and certain other amounts), all as more
specifically set forth herein and in the Sale and Servicing Agreement. A copy
of each of the Sale and Servicing Agreement and the Trust Agreement may be
examined by any Certificateholder upon written request during normal business
hours at the principal office of the Depositor and at such other places, if
any, designated by the Depositor.
The Trust Agreement permits, with certain exceptions therein
provided, the amendment thereof and the modification of the rights and
obligations of the Depositor and the Company and the rights of the
Certificateholders under the Trust Agreement at any time by the Depositor,
the Company and the Owner Trustee with the consent of the Holders of the
Trust Certificates, the Overcollateralization Certificates and the Notes,
each voting as a class, evidencing not less than a majority of the Percentage
Interests evidenced by the outstanding Trust Certificates, or a majority of
the Certificate Balance evidenced by the Overcollateralization Certificates
or a majority of the outstanding principal balance of the Notes of each such
class. Any such consent by the Holder of this Trust Certificate shall be
conclusive and binding on such Holder and on all future Holders of this Trust
Certificate and of any Trust 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 Trust Certificate. The Trust Agreement also permits
the amendment thereof, in certain limited circumstances, without the consent
of the Holders of any of the Certificates.
As provided in the Trust Agreement and subject to certain
limitations therein set forth, the transfer of this Trust Certificate is
registerable in the Certificate Register upon surrender of this Trust
Certificate for registration of transfer at the offices or agencies of the
Certificate Registrar maintained by the Owner Trustee in the Borough of
Manhattan, The City of New York, accompanied by a written instrument of
transfer in form satisfactory to the Owner 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 Trust Certificates of
authorized denominations evidencing the same aggregate interest in the Trust
will be issued to the designated transferee. The initial Certificate
Registrar appointed under the Trust Agreement is The Chase Manhattan Bank,
New York, New York.
Except as provided in the Trust Agreement, the Trust Certificates
are issuable only as registered Trust Certificates. As provided in the Trust
Agreement and subject to certain limitations therein set forth, Trust
Certificates are exchangeable for new Trust 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 Owner Trustee or the
Certificate Registrar may require payment of a sum sufficient to cover any
tax or governmental charge payable in connection therewith.
A-1-6
<PAGE>
The Owner Trustee, the Certificate Registrar and any agent of the
Owner Trustee or the Certificate Registrar may treat the Person in whose name
this Trust Certificate is registered as the owner hereof for all purposes,
and none of the Owner Trustee, the Certificate Registrar or any such agent
shall be affected by any notice to the contrary.
The obligations and responsibilities created by the Trust Agreement
and the Trust created thereby shall terminate upon the payment to
Certificateholders of all amounts required to be paid to them pursuant to the
Trust Agreement and the Sale and Servicing Agreement and the disposition of
all property held as part of the Owner Trust Estate. The Servicer of the
Receivables may at its option purchase the Owner Trust Estate at a price
specified in the Sale and Servicing Agreement, and such purchase of the
Receivables and other property of the Trust will effect early retirement of
the Trust Certificates; provided, however, such right of purchase is
exercisable only as of the last day of any Collection Period as of which the
Pool Balance is less than or equal to 10% of the Original Pool Balance.
The Trust Certificates may not be acquired by (a) an employee
benefit plan (as defined in Section 3(3) of ERISA) that is subject to the
provisions of Title I of ERISA, (b) a plan described in Section 4975(e)(1) of
the Code or (c) any entity whose underlying assets include plan assets by
reason of a plan's investment in the entity or which uses plan assets to
acquire Trust Certificates (each, a "Benefit Plan"). By accepting and holding
this Trust Certificate, the Holder hereof shall be deemed to have represented
and warranted that it is not a Benefit Plan.
A-1-7
<PAGE>
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 type name and address,
including postal zip code, of assignee)
the within Trust Certificate, and all rights thereunder, and hereby
irrevocably constitutes and appoints ___________ , attorney, to transfer said
Trust 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 of the registered owner as it appears on the face of the within
Trust Certificate in every particular, without alteration,
enlargement or any change whatever. Such signature must be
guaranteed by an "eligible guarantor institution" meeting the
requirements of the Certificate Registrar, which requirements
include membership or participation in STAMP or such other
"signature guarantee program" as may be determined by the
Certificate Registrar in addition to, or in substitution for, STAMP,
all in accordance with the Securities Exchange Act of 1934, as
amended.
A-1-8
<PAGE>
EXHIBIT A-2
Form of Overcollateralization Certificate
THIS CERTIFICATE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE "SECURITIES ACT"), OR ANY STATE SECURITIES LAWS, AND MAY NOT BE
OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED IN THE ABSENCE OF SUCH
REGISTRATION OR AN EXEMPTION THEREFROM. IN ADDITION, THE TRANSFER OF THIS
CERTIFICATE IS SUBJECT TO CERTAIN RESTRICTIONS AND CONDITIONS SET FORTH IN
SECTION 3.04 OF THE TRUST AGREEMENT UNDER WHICH THIS CERTIFICATE IS ISSUED (A
COPY OF WHICH TRUST AGREEMENT IS AVAILABLE FROM THE OWNER TRUSTEE OR UPON
REQUEST), INCLUDING RECEIPT BY THE OWNER TRUSTEE OF AN INVESTMENT LETTER IN
WHICH THE TRANSFEREE MAKES CERTAIN REPRESENTATIONS.
No. R-1 Initial Principal Balance: $____________
PREMIER AUTO TRUST 1998-5
OVERCOLLATERALIZATION CERTIFICATE
evidencing a fractional undivided interest in the Trust, as defined below,
the property of which includes a pool of retail installment sale contracts
and the Amortizing Payments on the Fixed Value Receivables (each as defined
herein) secured by new and used automobiles and light duty trucks.
(This Overcollateralization Certificate does not represent an interest in or
obligation of Chrysler Financial Corporation or any of its affiliates, except
to the extent described below.)
THIS CERTIFIES THAT _________________________________ is the
registered owner of _______________________________________________
nonassessable, fully-paid, fractional undivided interest in Premier Auto
Trust 1998-5 (the "Trust"), formed by Chrysler Financial Corporation, a
Michigan corporation (the "Depositor"), and Premier Receivables L.L.C., a
Michigan limited liability company (the "Company").
A-2-1
<PAGE>
OWNER TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Overcollateralization Certificates referred to in the
within-mentioned Trust Agreement.
CHASE MANHATTAN BANK DELAWARE, CHASE MANHATTAN BANK DELAWARE,
as Owner Trustee or as Owner Trustee
by: THE CHASE MANHATTAN BANK,
as Authenticating Agent
by: __________________________
Authorized Signatory by: __________________________
Authorized Signatory
A-2-2
<PAGE>
The Trust was created pursuant to a Trust Agreement dated as of
October 1, 1998, as amended and restated by an Amended and Restated Trust
Agreement dated as of October 1, 1998 (as so amended and restated and further
amended or supplemented from time to time, the "Trust Agreement"), among the
Depositor, the Company and Chase Manhattan Bank Delaware, as owner trustee
(the "Owner 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 the Trust
Agreement or the Sale and Servicing Agreement dated as of October 1, 1998 (as
amended and supplemented from time to time, the "Sale and Servicing
Agreement"), between the Trust and the Depositor, as seller and as servicer
(in such capacity, the "Servicer"), as applicable.
This Overcollateralization Certificate is one of the duly authorized
class of certificates designated as "Overcollateralization Certificates"
(herein called the "Overcollateralization Certificates"). Also issued under
the Trust Agreement is a duly authorized class of certificates designated as
"Trust Certificates" (the "Trust Certificates" and, together with the
Overcollateralization Certificates, the "Certificates"). Also issued under an
Indenture dated as October 1, 1998 (the "Indenture"), between the Trust and
The First National Bank of Chicago, as indenture trustee, are the four
classes of Notes designated as "Class A-1 5.14% Asset Backed Notes," "Class
A-2 5.07% Asset Backed Notes," "Class A-3 5.07% Asset Backed Notes" and
"Class A-4 5.19% Asset Backed Notes" (collectively, the "Notes"). This
Overcollateralization Certificate is issued under and is subject to the
terms, provisions and conditions of the Trust Agreement, to which Trust
Agreement the Holder of this Overcollateralization Certificate by virtue of
its acceptance hereof assents and by which such Holder is bound. The property
of the Trust consists of a pool of retail installment sale contracts for new
and used automobiles and light duty trucks and the Amortizing Payments on the
Fixed Value Receivables (collectively, the "Receivables"), all monies
received on or after October 14, 1998, security interests in the vehicles
financed thereby, certain bank accounts and the proceeds thereof, proceeds
from claims on certain insurance policies and certain other rights under the
Trust Agreement and the Sale and Servicing Agreement and all proceeds of the
foregoing. The term "Fixed Value Receivables" shall mean retail sale
contracts secured by new automobiles or light duty trucks with a series of
fixed level payment monthly installments (the "Amortizing Payments") and a
final fixed value payment that is greater than each Amortizing Payment.
Distributions, if any, in respect of this Overcollateralization Certificate
will be made pursuant to Section 5.02 of the Trust Agreement.
It is the intent of the Depositor, the Company, the Servicer and the
Certificateholder that, for purposes of federal income, state and local
income and single business tax and any other income taxes, the Trust will be
treated as a security arrangement for the issuance of debt by the sole
Certificateholder. The Company, by acceptance of the Overcollateralization
Certificates, agrees to treat, and to take no action inconsistent with the
above treatment for so long as the Company is the sole Owner.
Solely in the event the Certificates are held by more than a single
Owner, it is the intent of the Depositor, the Company, the Servicer and the
Certificateholders that, for purposes of federal income, state and local
income and single business tax and any other income taxes, the Trust will be
treated as a partnership and the Certificateholders (including the Company)
will be treated as partners in the partnership. The Company and the other
Certificateholders, by
A-2-3
<PAGE>
acceptance of a Certificate, agree to treat, and to take no action
inconsistent with the Treatment of, the Certificates for such tax purposes as
partnership interests in the Trust.
Each Certificateholder, by its acceptance of a Certificate covenants
and agrees that such Certificateholder will not at any time institute against
the Company, or join in any institution against the Company of, any
bankruptcy, reorganization, arrangement, insolvency or liquidation
proceedings, or other proceedings under any United States federal or state
bankruptcy or similar law in connection with any obligations relating to the
Overcollateralization Certificates, the Notes, the Trust Agreement or any of
the Basic Documents.
Distributions on this Overcollateralization Certificate will be made
as provided in the Trust Agreement by the Paying Agent by wire transfer or
check mailed to the Certificateholder of record in the Certificate Register
without the presentation or surrender of this Overcollateralization
Certificate or the making of any notation hereon. Except as otherwise
provided in the Trust Agreement and notwithstanding the above, the final
distribution on this Overcollateralization Certificate will be made after due
notice by the Owner Trustee of the pendency of such distribution and only
upon presentation and surrender of this Overcollateralization Certificate at
the office or agency maintained for that purpose by the Paying Agent in the
Borough of Manhattan, The City of New York.
Reference is hereby made to the further provisions of this
Overcollateralization 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 Owner Trustee, by manual signature,
this Overcollateralization Certificate shall not entitle the Holder hereof to
any benefit under the Trust Agreement or the Sale and Servicing Agreement or
be valid for any purpose.
THIS OVERCOLLATERALIZATION CERTIFICATE SHALL BE CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF DELAWARE, WITHOUT REFERENCE TO ITS
CONFLICT OF LAW PROVISIONS, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE
PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
A-2-4
<PAGE>
IN WITNESS WHEREOF, the Owner Trustee, on behalf of the Trust and
not in its individual capacity, has caused this Overcollateralization
Certificate to be duly executed.
PREMIER AUTO TRUST 1998-5
by: CHASE MANHATTAN BANK DELAWARE,
not in its individual
capacity but solely as Owner Trustee
Dated: _____________________ by: _________________________________
Authorized Signatory
A-2-5
<PAGE>
[REVERSE OF OVERCOLLATERALIZATION CERTIFICATE]
The Overcollateralization Certificates do not represent an
obligation of, or an interest in, the Depositor, the Servicer, the Company,
the Owner Trustee or any affiliates of any of them and no recourse may be had
against such parties or their assets, except as expressly set forth or
contemplated herein or in the Trust Agreement or the Basic Documents. In
addition, this Overcollateralization Certificate is not guaranteed by any
governmental agency or instrumentality and is limited in right of payment to
certain collections and recoveries with respect to the Receivables (and
certain other amounts), all as more specifically set forth herein and in the
Sale and Servicing Agreement. A copy of each of the Sale and Servicing
Agreement and the Trust Agreement may be examined by any Certificateholder
upon written request during normal business hours at the principal office of
the Depositor and at such other places, if any, designated by the Depositor.
The Trust Agreement permits, with certain exceptions therein
provided, the amendment thereof and the modification of the rights and
obligations of the Depositor and the Company and the rights of the
Certificateholders under the Trust Agreement at any time by the Depositor,
the Company and the Owner Trustee with the consent of the Holders of the
Trust Certificates, the Overcollateralization Certificates and the Notes,
each voting as a class, evidencing not less than a majority of the Percentage
Interests evidenced by the outstanding Trust Certificates, or a majority of
the Certificate Balance evidenced by the Overcollateralization Certificates
or a majority of the outstanding principal balance of the Notes of each such
class. Any such consent by the Holder of this Overcollateralization
Certificate shall be conclusive and binding on such Holder and on all future
Holders of this Overcollateralization Certificate and of any
Overcollateralization 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 Overcollateralization Certificate. The Trust Agreement also
permits the amendment thereof, in certain limited circumstances, without the
consent of the Holders of any of the Certificates.
As provided in the Trust Agreement and subject to certain
limitations therein set forth, the transfer of this Overcollateralization
Certificate is registerable in the Certificate Register upon surrender of
this Overcollateralization Certificate for registration of transfer at the
offices or agencies of the Certificate Registrar maintained by the Owner
Trustee in the Borough of Manhattan, The City of New York, accompanied by a
written instrument of transfer in form satisfactory to the Owner 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
Overcollateralization Certificates of authorized denominations evidencing the
same aggregate interest in the Trust will be issued to the designated
transferee. The initial Certificate Registrar appointed under the Trust
Agreement is The Chase Manhattan Bank, New York, New York.
Except as provided in the Trust Agreement, the Overcollateralization
Certificates are issuable only as registered Overcollateralization
Certificates in minimum denominations of $1,000,000 principal amount of
Certificate Balance and in integral multiples of $1,000 in excess thereof. As
provided in the Trust Agreement and subject to certain limitations therein
set forth, Overcollateralization Certificates are exchangeable for new
Overcollateralization Certificates of
A-2-6
<PAGE>
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 Owner Trustee or
the Certificate Registrar may require payment of a sum sufficient to cover
any tax or governmental charge payable in connection therewith.
The Owner Trustee, the Certificate Registrar and any agent of the
Owner Trustee or the Certificate Registrar may treat the Person in whose name
this Overcollateralization Certificate is registered as the owner hereof for
all purposes, and none of the Owner Trustee, the Certificate Registrar or any
such agent shall be affected by any notice to the contrary.
The obligations and responsibilities created by the Trust Agreement
and the Trust created thereby shall terminate upon the payment to
Certificateholders of all amounts required to be paid to them pursuant to the
Trust Agreement and the Sale and Servicing Agreement and the disposition of
all property held as part of the Owner Trust Estate. The Servicer of the
Receivables may at its option purchase the Owner Trust Estate at a price
specified in the Sale and Servicing Agreement, and such purchase of the
Receivables and other property of the Trust will effect early retirement of
the Overcollateralization Certificates; provided, however, such right of
purchase is exercisable only as of the last day of any Collection Period as
of which the Pool Balance is less than or equal to 10% of the Original Pool
Balance.
The Overcollateralization Certificates may not be acquired by (a) an
employee benefit plan (as defined in Section 3(3) of ERISA) that is subject
to the provisions of Title I of ERISA, (b) a plan described in Section
4975(e)(1) of the Code or (c) any entity whose underlying assets include plan
assets by reason of a plan's investment in the entity or which uses plan
assets to acquire Overcollateralization Certificates (each, a "Benefit
Plan"). By accepting and holding this Overcollateralization Certificate, the
Holder hereof shall be deemed to have represented and warranted that it is
not a Benefit Plan.
A-2-7
<PAGE>
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 type name and address,
including postal zip code, of assignee)
the within Overcollateralization Certificate, and all rights thereunder, and
hereby irrevocably constitutes and appoints , attorney, to transfer said
Overcollateralization 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 of the registered owner as it appears on the face of the within
Overcollateralization Certificate in every particular, without
alteration, enlargement or any change whatever. Such signature must
be guaranteed by an "eligible guarantor institution" meeting the
requirements of the Certificate Registrar, which requirements
include membership or participation in STAMP or such other
"signature guarantee program" as may be determined by the
Certificate Registrar in addition to, or in substitution for, STAMP,
all in accordance with the Securities Exchange Act of 1934, as
amended.
A-2-8
<PAGE>
EXHIBIT B
Form of Certificate of Trust of Premier Auto Trust 199_-_
THIS Certificate of Trust of Premier Auto Trust 199_-_ (the
"Trust"), dated ___________, 199_, is being duly executed and filed by Chase
Manhattan Bank Delaware, a Delaware banking corporation, as trustee, to form
a business trust under the Delaware Business Trust Act (12 Del. Code, ss.
3801 et seq.).
1. Name. The name of the business trust formed hereby is
PREMIER AUTO TRUST 199_-_.
2. Delaware Trustee. The name and business address of the
trustee of the Trust in the State of Delaware is Chase Manhattan Bank
Delaware, 1201 Market Street, Wilmington, Delaware 19801, Attention:
Corporate Trustee Administration Department.
3. Effective Date. This Certificate of Trust shall be
effective upon its filing with the Secretary of State of the State of
Delaware.
IN WITNESS WHEREOF, the undersigned, being the sole trustee
of the Trust, has executed this Certificate of Trust as of the date first
above written.
CHASE MANHATTAN BANK DELAWARE,
not in its individual capacity
but as owner trustee under
the Trust Agreement dated as of
____________, 199__-__
by: ____________________________
Name:
Title:
B-1
<PAGE>
EXHIBIT C
FORM OF TRANSFEROR CERTIFICATE
[DATE]
[Seller]
[Seller Address]
[Owner Trustee]
[Owner Trustee Address]
Re: Premier Auto Trust 1998-5
[Trust] [Overcollateralization] Certificates
Ladies and Gentlemen:
In connection with our disposition of the above-referenced [Trust]
[Overcollateralization] Certificates (the "Certificates") we certify that (a)
we understand that the Certificates have not been registered under the
Securities Act of 1933, as amended (the "Act"), and are being transferred by
us in a transaction that is exempt from the registration requirements of the
Act and (b) we have not offered or sold any Certificates to, or solicited
offers to buy any Certificates from, any person, or otherwise approached or
negotiated with any person with respect thereto, in a manner that would be
deemed, or taken any other action which would result in, a violation of
Section 5 of the Act.
Very truly yours,
[NAME OF TRANSFEROR]
By: ________________________
Authorized Officer
C-1
<PAGE>
EXHIBIT D
FORM OF INVESTMENT LETTER
[DATE]
[Seller]
[Seller Address]
[Owner Trustee]
[Owner Trustee Address]
Re: Premier Auto Trust 1998-5
[Trust] [Overcollateralization] Certificates
Ladies and Gentlemen:
In connection with our acquisition of the above-referenced [Trust]
[Overcollateralization] Certificates (the "Certificates") we certify that (a)
we understand that the Certificates are not being registered under the
Securities Act of 1933, as amended (the "Act"), or any state securities laws
and are being transferred to us in a transaction that is exempt from the
registration requirements of the Act and any such laws, (b) we are an
"accredited investor," as defined in Regulation D under the Act, and have
such knowledge and experience in financial and business matters that we are
capable of evaluating the merits and risks of investments in the
Certificates, (c) we have had the opportunity to ask questions of and receive
answers from the seller concerning the purchase of the Certificates and all
matters relating thereto or any additional information deemed necessary to
our decision to purchase the Certificates, (d) we are acquiring the
Certificates for investment for our own account and not with a view to any
distribution of such Certificates (but without prejudice to our right at all
times to sell or otherwise dispose of the Certificates in accordance with
clause (f) below), (e) we have not offered or sold any Certificates to, or
solicited offers to buy any Certificates from, any person, or otherwise
approached or negotiated with any person with respect thereto, or taken any
other action that would result in a violation of Section 5 of the Act or any
state securities laws and (f) we will not sell, transfer or otherwise dispose
of any Certificates unless (1) such sale, transfer or other disposition is
made pursuant to an effective registration statement under the Act and in
compliance with any relevant state securities laws or is exempt from such
registration requirements and, if requested, we will at our expense provide
an Opinion of Counsel satisfactory to the addresses of this certificate that
such sale, transfer or other disposition may be made pursuant to an exemption
from the Act, (2) the purchaser or transferee of such Certificate has
executed and delivered to you a certificate to substantially the same effect
as this certificate and (3) the purchaser or transferee has otherwise
complied with any conditions for transfer set forth in the Amended and
Restated Trust dated as of October 1, 1998, between Chrysler Financial
Corporation, as Depositor, Premier Receivables L.L.C. and Chase Manhattan
Bank Delaware, as Owner Trustee.
Very truly yours,
[NAME OF TRANSFEROR]
By: _______________________________
Authorized Officer
D-1
<PAGE>
EXHIBIT E
FORM OF RULE 144A LETTER
[DATE]
[Seller]
[Seller Address]
[Owner Trustee]
[Owner Trustee Address]
Re: Premier Auto Trust 1998-5
[Trust] [Overcollateralization] Certificates
Ladies and Gentlemen:
In connection with our acquisition of the above-referenced [Trust]
[Overcollateralization] Certificates (the "Certificates") we certify that (a)
we understand that the Certificates are not being registered under the
Securities Act of 1933, as amended (the "Act"), or any state securities laws
and are being transferred to us in a transaction that is exempt from the
registration requirements of the Act and any such laws, (b) we have such
knowledge and experience in financial and business matters that we are
capable of evaluating the merits and risks of investments in the
Certificates, (c) we have had the opportunity to ask questions of and receive
answers from the seller concerning the purchase of the Certificates and all
matters relating thereto or any additional information deemed necessary to
our decision to purchase the Certificates, (d) we have not, nor has anyone
acting on our behalf, offered, transferred, pledged, sold or otherwise
disposed of the Certificates or any interest in the Certificates, or
solicited any offer to buy, transfer, pledge or otherwise dispose of the
Certificates or any interest in the Certificates from any person in any
manner, or made any general solicitation by means of general advertising or
in any other manner, or taken any other action that would constitute a
distribution of the Certificates under the Act or that would render the
disposition of the Certificates a violation of Section 5 of the Act or any
state securities laws or require registration pursuant thereto, and we will
not act, or authorize any person to act, in such manner with respect to the
Certificates, (e) we are a "qualified institutional buyer" as that term is
defined in Rule 144A under the Act. We are aware that the sale to us is being
made in reliance on Rule 144A. We are acquiring the Certificates for our own
account or for resale pursuant to Rule 144A and understand that such
Certificates may be resold, pledged or transferred only (i) to a person
reasonably believed to be a qualified institutional buyer that purchases for
its own account or for the account of a qualified institutional buyer to whom
notice is given that the resale, pledge or transfer is being made in reliance
on Rule 144A or (ii) pursuant to another exemption from registration under
the Act.
Very truly yours,
[NAME OF TRANSFEROR]
By: _______________________
Authorized Officer
E-1
Conformed copy
==============================================================================
INDENTURE
between
PREMIER AUTO TRUST 1998-5,
as Issuer
and
THE FIRST NATIONAL BANK OF CHICAGO,
as Indenture Trustee
Dated as of October 1, 1998
==============================================================================
<PAGE>
Table of Contents
Page
----
ARTICLE I
Definitions and Incorporation by Reference
(a) Definitions................................................ 2
SECTION 1.02 Incorporation by Reference of Trust Indenture Act.......... 9
SECTION 1.03 Rules of Construction...................................... 9
ARTICLE II
The Notes
SECTION 2.01. Form....................................................... 10
SECTION 2.02. Execution, Authentication and Delivery..................... 10
SECTION 2.03. Temporary Notes............................................ 11
SECTION 2.04. [Reserved]................................................. 11
SECTION 2.05. Registration; Registration of Transfer and Exchange........ 11
SECTION 2.06. Mutilated, Destroyed, Lost or Stolen Notes................. 12
SECTION 2.07. Persons Deemed Owner....................................... 13
SECTION 2.08. Payment of Principal and Interest; Defaulted Interest...... 13
SECTION 2.09. Cancellation............................................... 14
SECTION 2.10. Release of Collateral...................................... 15
SECTION 2.11. Book-Entry Notes........................................... 15
SECTION 2.12. Notices to Clearing Agency................................. 15
SECTION 2.13. Definitive Notes........................................... 16
SECTION 2.14. Tax Treatment.............................................. 16
ARTICLE III
Covenants
SECTION 3.01. Payment of Principal and Interest.......................... 16
SECTION 3.02. Maintenance of Office or Agency............................ 17
SECTION 3.03. Money for Payments To Be Held in Trust..................... 17
SECTION 3.04. Existence.................................................. 18
SECTION 3.05. Protection of Trust Estate................................. 19
SECTION 3.06. Opinions as to Trust Estate................................ 19
SECTION 3.07. Performance of Obligations; Servicing of Receivables....... 19
SECTION 3.08. Negative Covenants......................................... 21
SECTION 3.09. Annual Statement as to Compliance.......................... 22
SECTION 3.10. Issuer May Consolidate, etc., Only on Certain Terms........ 22
SECTION 3.11. Successor or Transferee.................................... 24
SECTION 3.12. No Other Business.......................................... 24
SECTION 3.13. No Borrowing............................................... 24
SECTION 3.14. Servicer's Obligations..................................... 24
SECTION 3.15. Guarantees, Loans, Advances and Other Liabilities.......... 24
i
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SECTION 3.16. Capital Expenditures....................................... 24
SECTION 3.17. Removal of Administrator................................... 25
SECTION 3.18. Restricted Payments........................................ 25
SECTION 3.19. Notice of Events of Default................................ 25
SECTION 3.20. Further Instruments and Acts............................... 25
ARTICLE IV
Satisfaction and Discharge
SECTION 4.01. Satisfaction and Discharge of Indenture.................... 25
SECTION 4.02. Application of Trust Money................................. 26
SECTION 4.03. Repayment of Moneys Held by Paying Agent................... 27
ARTICLE V
Remedies
SECTION 5.01. Events of Default.......................................... 27
SECTION 5.02. Acceleration of Maturity; Rescission and Annulment......... 28
SECTION 5.03. Collection of Indebtedness and Suits for Enforcement
by Indenture Trustee..................................... 29
SECTION 5.04. Remedies; Priorities....................................... 31
SECTION 5.05. Optional Preservation of the Receivables................... 32
SECTION 5.06. Limitation of Suits........................................ 32
SECTION 5.07. Unconditional Rights of Noteholders To Receive
Principal and Interest................................... 33
SECTION 5.08. Restoration of Rights and Remedies......................... 33
SECTION 5.09. Rights and Remedies Cumulative............................. 33
SECTION 5.10. Delay or Omission Not a Waiver............................. 34
SECTION 5.11. Control by Noteholders..................................... 34
SECTION 5.12. Waiver of Past Defaults.................................... 34
SECTION 5.13. Undertaking for Costs...................................... 35
SECTION 5.14. Waiver of Stay or Extension Laws........................... 35
SECTION 5.15. Action on Notes............................................ 35
SECTION 5.16. Performance and Enforcement of Certain Obligations......... 35
ARTICLE VI
The Indenture Trustee
SECTION 6.01. Duties of Indenture Trustee................................ 36
SECTION 6.02. Rights of Indenture Trustee................................ 37
SECTION 6.03. Individual Rights of Indenture Trustee..................... 38
SECTION 6.04. Indenture Trustee's Disclaimer............................. 38
SECTION 6.05. Notice of Defaults......................................... 38
SECTION 6.06. Reports by Indenture Trustee to Holders.................... 38
SECTION 6.07. Compensation and Indemnity................................. 38
SECTION 6.08. Replacement of Indenture Trustee........................... 39
ii
<PAGE>
SECTION 6.09. Successor Indenture Trustee by Merger...................... 40
SECTION 6.10. Appointment of Co-Indenture Trustee or
Separate Indenture Trustee............................... 40
SECTION 6.11. Eligibility; Disqualification.............................. 41
SECTION 6.12. Preferential Collection of Claims Against Issuer........... 41
SECTION 6.13. Pennsylvania Motor Vehicle Sales Finance Act Licenses...... 42
ARTICLE VII
Noteholders' Lists and Reports
SECTION 7.01. Issuer To Furnish Indenture Trustee Names and Addresses
of Noteholders........................................... 42
SECTION 7.02. Preservation of Information; Communications to Noteholders. 42
SECTION 7.03. Reports by Issuer.......................................... 42
SECTION 7.04. Reports by Indenture Trustee............................... 43
ARTICLE VIII
Accounts, Disbursements and Releases
SECTION 8.01. Collection of Money........................................ 43
SECTION 8.02. Collection Account......................................... 43
SECTION 8.03. General Provisions Regarding Accounts...................... 44
SECTION 8.04. Release of Trust Estate.................................... 45
SECTION 8.05. Opinion of Counsel......................................... 46
ARTICLE IX
Supplemental Indentures
SECTION 9.01. Supplemental Indentures Without Consent of Noteholders..... 46
SECTION 9.02. Supplemental Indentures with Consent of Noteholders........ 47
SECTION 9.03. Execution of Supplemental Indentures....................... 49
SECTION 9.04. Effect of Supplemental Indenture........................... 49
SECTION 9.05. Conformity with Trust Indenture Act........................ 49
SECTION 9.06. Reference in Notes to Supplemental Indentures.............. 49
ARTICLE X
Redemption of Notes
SECTION 10.01. Redemption................................................. 50
SECTION 10.02. Form of Redemption Notice.................................. 50
SECTION 10.03. Notes Payable on Redemption Date........................... 50
ARTICLE XI
Miscellaneous
SECTION 11.01. Compliance Certificates and Opinions, etc.................. 51
iii
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SECTION 11.02. Form of Documents Delivered to Indenture Trustee........... 52
SECTION 11.03. Acts of Noteholders........................................ 53
SECTION 11.04. Notices, etc., to Indenture Trustee, Issuer and Rating
Agencies................................................. 54
SECTION 11.05. Notices to Noteholders; Waiver............................. 54
SECTION 11.06. Alternate Payment and Notice Provisions.................... 55
SECTION 11.07. Conflict with Trust Indenture Act.......................... 55
SECTION 11.08. Effect of Headings and Table of Contents................... 55
SECTION 11.09. Successors and Assigns..................................... 55
SECTION 11.10. Separability............................................... 56
SECTION 11.11. Benefits of Indenture...................................... 56
SECTION 11.12. Legal Holidays............................................. 56
SECTION 11.13. GOVERNING LAW.............................................. 56
SECTION 11.14. Counterparts............................................... 56
SECTION 11.15. Recording of Indenture..................................... 56
SECTION 11.16. Trust Obligation........................................... 56
SECTION 11.17. No Petition................................................ 57
SECTION 11.18. Inspection................................................. 57
SCHEDULE A -- Schedule of Receivables
EXHIBIT A-1 -- Form of Class A-1 Note
EXHIBIT A-2 -- Form of Class A-2 Note
EXHIBIT A-3 -- Form of Class A-3 Note
EXHIBIT A-4 -- Form of Class A-4 Note
EXHIBIT B Form of Note Depository Agreement
iv
<PAGE>
INDENTURE dated as of October 1, 1998, between PREMIER AUTO TRUST
1998-5, a Delaware business trust (the "Issuer"), and THE FIRST NATIONAL BANK
OF CHICAGO, a national banking association, as trustee and not in its
individual capacity (the "Indenture Trustee").
Each party agrees as follows for the benefit of the other party
and for the equal and ratable benefit of the Holders of the Issuer's Class
A-1 5.14% Asset Backed Notes (the "Class A-1 Notes"), Class A-2 5.07% Asset
Backed Notes (the "Class A-2 Notes"), Class A-3 5.07% Asset Backed Notes (the
"Class A-3 Notes") and Class A-4 5.19% Asset Backed Notes (the "Class A-4
Notes" and, together with the Class A-1 Notes, the Class A-2 Notes and Class
A-3 Notes, the "Notes"):
GRANTING CLAUSE
The Issuer hereby Grants to the Indenture Trustee at the Closing
Date, as Indenture Trustee for the benefit of the Holders of the Notes, all
of the Issuer's right, title and interest in and to (a) the Receivables and
all moneys received thereon on and after October 14, 1998; (b) the security
interests in the Financed Vehicles granted by Obligors pursuant to the
Receivables and any other interest of the Issuer in such Financed Vehicles;
(c) any proceeds with respect to the Receivables from claims on any physical
damage, credit life or disability insurance policies covering Financed
Vehicles or Obligors; (d) any proceeds with respect to the Receivables from
recourse to Dealers thereon with respect to which the Servicer has determined
in accordance with its customary servicing procedures that eventual payment
in full is unlikely; (e) any Financed Vehicle that shall have secured a
Receivable and that shall have been acquired by or on behalf of the Seller,
the Servicer, the Company or the Issuer; (f) all funds on deposit from time
to time in the Collection Account, including the Reserve Account Initial
Deposit, and in all investments and proceeds thereof (including all income
thereon); (g) the Sale and Servicing Agreement (including the Issuer's right
to cause the Seller to repurchase Standard Receivables or Fixed Value
Receivables from the Issuer under certain circumstances described therein);
and (h) all present and future claims, demands, causes of action and chooses
in action in respect of any or all of the foregoing and all payments on or
under and all proceeds of every kind and nature whatsoever in respect of any
or all of the foregoing, including all proceeds of the conversion thereof,
voluntary or involuntary, into cash or other liquid property, all cash
proceeds, accounts, accounts receivable, notes, drafts, acceptances, chattel
paper, checks, deposit accounts, insurance proceeds, condemnation awards,
rights to payment of any and every kind and other forms of obligations and
receivables, instruments and other property which at any time constitute all
or part of or are included in the proceeds of any of the foregoing
(collectively, the "Collateral").
The foregoing Grant is made in trust to secure the payment of
principal of and interest on, and any other amounts owing in respect of, the
Notes, equally and ratably without prejudice, priority or distinction, and to
secure compliance with the provisions of this Indenture, all as provided in
this Indenture.
The Indenture Trustee, as Indenture Trustee on behalf of the
Holders of the Notes, acknowledges such Grant, accepts the trusts under this
Indenture in accordance with the provisions of this Indenture and agrees to
perform its duties required in this Indenture to the best
<PAGE>
of its ability to the end that the interests of the Holders of the Notes may
be adequately and effectively protected.
ARTICLE I
Definitions and Incorporation by Reference
SECTION 1.01. a) Definitions. Except as otherwise specified herein
or as the context may otherwise require, the following terms have the
respective meanings set forth below for all purposes of this Indenture
"Act" has the meaning specified in Section 11.03(a).
"Administration Agreement" means the Administration Agreement
dated as of October 1, 1998, among the Administrator, the Issuer and the
Indenture Trustee.
"Administrator" means Chrysler Financial Corporation, a Michigan
corporation, or any successor Administrator under the Administration
Agreement.
"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 Person means the power to direct the management and
policies of such Person, directly or indirectly, whether through the
ownership of voting securities, by contract or otherwise; and the terms
"controlling" and "controlled" have meanings correlative to the foregoing.
"Authorized Officer" means, with respect to the Issuer, any
officer of the Owner Trustee who is authorized to act for the Owner Trustee
in matters relating to the Issuer and who is identified on the list of
Authorized Officers delivered by the Owner Trustee to the Indenture Trustee
on the Closing Date (as such list may be modified or supplemented from time
to time thereafter) and, so long as the Administration Agreement is in
effect, any Vice President or more senior officer of the Administrator who is
authorized to act for the Administrator in matters relating to the Issuer and
to be acted upon by the Administrator pursuant to the Administration
Agreement and who is identified on the list of Authorized Officers delivered
by the Administrator to the Indenture Trustee on the Closing Date (as such
list may be modified or supplemented from time to time thereafter).
"Basic Documents" means the Certificate of Trust, the Trust
Agreement, the Sale and Servicing Agreement, the Purchase Agreement, the
Administration Agreement, the Note Depository Agreement and other documents
and certificates delivered in connection therewith.
"Book-Entry Notes" means a beneficial interest in the Class A-1
Notes, Class A-2 Notes, Class A-3 Notes and Class A-4 Notes, ownership and
transfers of which shall be made through book entries by a Clearing Agency as
described in Section 2.11.
2
<PAGE>
"Business Day" means any day other than a Saturday, a Sunday or a
day on which banking institutions or trust companies in The City of New York
are authorized or obligated by law, regulation or executive order to remain
closed.
"Certificate of Trust" means the certificate of trust of the
Issuer substantially in the form of Exhibit B to the Trust Agreement.
"Class A-1 Interest Accrual Period" means the period from and
including the most recent Distribution Date on which interest has been paid
(or, in the case of the first Distribution Date, the Closing Date) to but
excluding the following Distribution Date.
"Class A-1 Interest Rate" means 5.14% per annum (computed on the
basis of the actual number of days in the Class A-1 Interest Accrual Period
divided by 360).
"Class A-1 Notes" means the Class A-1 5.14% Asset Backed Notes,
substantially in the form of Exhibit A-1.
"Class A-2 Interest Rate" means 5.07% per annum (computed on the
basis of a 360-day year consisting of twelve 30-day months).
"Class A-2 Notes" means the Class A-2 5.07% Asset Backed Notes,
substantially in the form of Exhibit A-2.
"Class A-3 Interest Rate" means 5.07% per annum (computed on the
basis of a 360 day year consisting of twelve 30-day months).
"Class A-3 Notes" means the Class A-3 5.07% Asset Backed Notes,
substantially in the form of Exhibit A-3.
"Class A-4 Interest Rate" means 5.19% per annum (computed on the
basis of a 360-day year consisting of twelve 30-day months).
"Class A-4 Notes" means the Class A-4 5.19% Asset Backed Notes,
substantially in the form of Exhibit A-4.
"Clearing Agency" means an organization registered as a "clearing
agency" pursuant to Section 17A of the Exchange Act.
"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.
"Closing Date" means October 23, 1998.
"Code" means the Internal Revenue Code of 1986, as amended from
time to time, and Treasury Regulations promulgated thereunder.
"Collateral" has the meaning specified in the Granting Clause of
this Indenture.
3
<PAGE>
"Company" means Premier Receivables L.L.C., a Michigan limited
liability company, any successor in interest and any transferee of the Rights
(as defined in the Purchase Agreement) that becomes such transferee in
accordance with Section 5.06 of the Purchase Agreement.
"Corporate Trust Office" means the principal office of the
Indenture Trustee at which at any particular time its corporate trust
business shall be administered, which office at the date of execution of this
Agreement is located at One First National Plaza, Suite 0126, Chicago,
Illinois 60670, Attention: Corporate Trust Services Division, or at such
other address as the Indenture Trustee may designate from time to time by
notice to the Noteholders and the Issuer, or the principal corporate trust
office of any successor Indenture Trustee at the address designated by such
successor Indenture Trustee by notice to the Noteholders and the Issuer.
"Default" means any occurrence that is, or with notice or the
lapse of time or both would become, an Event of Default.
"Definitive Notes" has the meaning specified in Section 2.11.
"Event of Default" has the meaning specified in Section 5.01.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended.
"Executive Officer" means, with respect to any corporation, the
Chief Executive Officer, Chief Operating Officer, Chief Financial Officer,
President, Executive Vice President, any Vice President, the Secretary or the
Treasurer of such corporation; and with respect to any partnership, any
general partner thereof.
"Grant" means mortgage, pledge, bargain, warrant, alienate,
remise, release, convey, assign, transfer, create, and grant a lien upon and
a security interest in and a right of set-off against, deposit, set over and
confirm pursuant to this Indenture. A Grant of the Collateral or of any other
agreement or instrument shall include all rights, powers and options (but
none of the obligations) of the granting party thereunder, including the
immediate and continuing right to claim for, collect, receive and give
receipt for principal and interest payments in respect of the Collateral and
all other moneys payable thereunder, to give and receive notices and other
communications, to make waivers or other agreements, to exercise all rights
and options, to bring Proceedings in the name of the granting party or
otherwise, and generally to do and receive anything that the granting party
is or may be entitled to do or receive thereunder or with respect thereto.
"Holder" or "Noteholder" means the Person in whose name a Note is
registered on the Note Register.
"Indenture Trustee" means The First National Bank of Chicago, a
national banking association, as Indenture Trustee under this Indenture, or
any successor Indenture Trustee under this Indenture.
"Independent" means, when used with respect to any specified
Person, that the Person (a) is in fact independent of the Issuer, any other
obligor on the Notes, the Seller and any
4
<PAGE>
Affiliate of any of the foregoing Persons, (b) does not have any direct
financial interest or any material indirect financial interest in the Issuer,
any such other obligor, the Seller or any Affiliate of any of the foregoing
Persons and (c) is not connected with the Issuer, any such other obligor, the
Seller or any Affiliate of any of the foregoing Persons as an officer,
employee, promoter, underwriter, trustee, partner, director or person
performing similar functions.
"Independent Certificate" means a certificate or opinion to be
delivered to the Indenture Trustee under the circumstances described in, and
otherwise complying with, the applicable requirements of Section 11.01, made
by an Independent appraiser or other expert appointed by an Issuer Order and
approved by the Indenture Trustee in the exercise of reasonable care, and
such opinion or certificate shall state that the signer has read the
definition of "Independent" in this Indenture and that the signer is
Independent within the meaning thereof.
"Interest Accrual Period" means, with respect to any Distribution
Date and the Notes, other than the Class A-1 Notes, the period from and
including the eighth day of the month preceding the month of such
Distribution Date (or, in the case of the first Distribution Date, the
Closing Date) to and including the seventh day of the month of such
Distribution Date.
"Interest Rate" means the Class A-1 Interest Rate, the Class A-2
Interest Rate, the Class A-3 Interest Rate or the Class A-4 Interest Rate.
"Issuer" means Premier Auto Trust 1998-5 until a successor
replaces it and, thereafter, means the successor and, for purposes of any
provision contained herein and required by the TIA, each other obligor on the
Notes.
"Issuer Order" or "Issuer Request" means a written order or
request signed in the name of the Issuer by any one of its Authorized
Officers and delivered to the Indenture Trustee.
"Notes" means Class A-1 Notes, Class A-2 Notes, Class A-3 Notes or
Class A-4 Notes.
"Note Depository Agreement" means the agreement dated October 23,
1998, among the Issuer, the Administrator, the Indenture Trustee and The
Depository Trust Company, as the initial Clearing Agency, relating to the
Class A-1 Notes, the Class A-2 Notes, the Class A-3 Notes and the Class A-4
Notes, substantially in the form of Exhibit B.
"Note Owner" means, with respect to a Book-Entry Note, the Person
who is the beneficial owner of such Book-Entry Note, as reflected on the
books of the Clearing Agency or on the books of a Person maintaining an
account with such Clearing Agency (directly as a Clearing Agency Participant
or as an indirect participant, in each case in accordance with the rules of
such Clearing Agency).
"Note Register" and "Note Registrar" have the respective meanings
specified in Section 2.05.
"Officer's Certificate" means a certificate signed by any
Authorized Officer of the Issuer, under the circumstances described in, and
otherwise complying with, the applicable requirements of Section 11.01, and
delivered to the Indenture Trustee. Unless otherwise specified, any
5
<PAGE>
reference in this Indenture to an Officer's Certificate shall be to an
Officer's Certificate of any Authorized Officer of the Issuer.
"Opinion of Counsel" means one or more written opinions of counsel
who may, except as otherwise expressly provided in this Indenture, be an
employee of or counsel to the Issuer and who shall be satisfactory to the
Indenture Trustee, and which opinion or opinions shall be addressed to the
Indenture Trustee as Indenture Trustee, shall comply with any applicable
requirements of Section 11.01 and shall be in form and substance satisfactory
to the Indenture Trustee.
"Outstanding" means, as of the date of determination, all Notes
theretofore authenticated and delivered under this Indenture except:
(i) Notes theretofore cancelled by the Note Registrar or
delivered to the Note Registrar for cancellation;
(ii) Notes or portions thereof the payment for which
money in the necessary amount has been theretofore deposited with
the Indenture Trustee or any Paying Agent in trust for the Holders
of such Notes (provided, however, that if such Notes are to be
redeemed, notice of such redemption has been duly given pursuant
to this Indenture or provision for such notice has been made,
satisfactory to the Indenture Trustee); and
(iii) Notes in exchange for or in lieu of which other
Notes have been authenticated and delivered pursuant to this
Indenture unless proof satisfactory to the Indenture Trustee is
presented that any such Notes are held by a bona fide purchaser;
provided, that in determining whether the Holders of the requisite
Outstanding Amount of the Notes have given any request, demand,
authorization, direction, notice, consent or waiver hereunder or under any
Basic Document, Notes owned by the Issuer, any other obligor upon the Notes,
the Seller or any Affiliate of any of the foregoing Persons shall be
disregarded and deemed not to be Outstanding, except that, in determining
whether the Indenture Trustee shall be protected in relying upon any such
request, demand, authorization, direction, notice, consent or waiver, only
Notes that the Indenture Trustee knows to be so owned shall be so
disregarded. Notes so owned that have been pledged in good faith may be
regarded as Outstanding if the pledgee establishes to the satisfaction of the
Indenture Trustee the pledgee's right so to act with respect to such Notes
and that the pledgee is not the Issuer, any other obligor upon the Notes, the
Seller or any Affiliate of any of the foregoing Persons.
"Outstanding Amount" means the aggregate principal amount of all
Notes, or Class of Notes, as applicable, Outstanding at the date of
determination.
"Overcollateralization Certificates" has the meaning assigned to
such term in the Trust Agreement.
"Owner Trustee" means Chase Manhattan Bank Delaware, not in its
individual capacity but solely as Owner Trustee under the Trust Agreement, or
any successor Owner Trustee under the Trust Agreement.
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"Paying Agent" means the Indenture Trustee or any other Person
that meets the eligibility standards for the Indenture Trustee specified in
Section 6.11 and is authorized by the Issuer to make payments to and
distributions from the Collection Account, including payments of principal of
or interest on the Notes on behalf of the Issuer.
"Payment Date" means a Distribution Date.
"Person" means any individual, corporation, estate, partnership,
joint venture, association, joint stock company, trust (including any
beneficiary thereof), unincorporated organization or government or any agency
or political subdivision thereof.
"Predecessor Note" means, with respect to any particular Note,
every previous Note evidencing all or a portion of the same debt as that
evidenced by such particular Note; and, for the purpose of this definition,
any Note authenticated and delivered under Section 2.06 in lieu of a
mutilated, lost, destroyed or stolen Note shall be deemed to evidence the
same debt as the mutilated, lost, destroyed or stolen Note.
"Proceeding" means any suit in equity, action at law or other
judicial or administrative proceeding.
"Purchase Agreement" means the Purchase Agreement dated as of
October 1, 1998, between the Seller and the Company.
"Rating Agency Condition" means, with respect to any action, that
each Rating Agency shall have been given 10 days (or such shorter period as
is acceptable to each Rating Agency) prior notice thereof and that each of
the Rating Agencies shall have notified the Seller, the Servicer and the
Issuer in writing that such action will not result in a reduction or
withdrawal of the then current rating of the Notes.
"Rating Agency" means Moody's Investor's Service ("Moody's") and
Standard & Poor's Ratings Services ("Standard & Poor's"). If no such
organization or successor is any longer in existence, "Rating Agency" shall
be a nationally recognized statistical rating organization or other
comparable Person designated by the Issuer, notice of which designation shall
be given to the Indenture Trustee, the Owner Trustee and the Servicer. Any
notice required to be given to a Rating Agency pursuant to this Agreement
shall also be given to Fitch IBCA, Inc. and Duff & Phelps Credit Rating Co.,
although, except as set forth above, neither shall be deemed to be a Rating
Agency for any purposes of this Agreement.
"Record Date" means, with respect to a Distribution Date or
Redemption Date, the close of business on the day immediately preceding such
Distribution Date or Redemption Date or, if Definitive Notes have been issued
pursuant to Section 2.13, the 15th day of the preceding month.
"Redemption Date" means, in the case of a redemption of the Notes
pursuant to Section 10.01, the Distribution Date specified by the Servicer or
the Issuer pursuant to Section 10.01.
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"Redemption Price" means in connection with a redemption of the
Notes pursuant to Section 10.01, an amount equal to the unpaid principal
amount of the Notes redeemed plus accrued and unpaid interest thereon at the
weighted average of the Interest Rates for each Class of Notes being so
redeemed to but excluding the Redemption Date.
"Registered Holder" means the Person in whose name a Note is
registered on the Note Register on the applicable Record Date.
"Responsible Officer" means, with respect to the Indenture
Trustee, any officer within the Corporate Trust Office of the Indenture
Trustee, including any Vice President, Assistant Vice President, Assistant
Treasurer, Assistant Secretary or any other officer of the Indenture Trustee
customarily performing functions similar to those performed by any of the
above designated officers and also, with respect to a particular matter, any
other officer to whom such matter is referred because of such officer's
knowledge of and familiarity with the particular subject.
"Sale and Servicing Agreement" means the Sale and Servicing
Agreement dated as of October 1, 1998, between the Issuer and Chrysler
Financial Corporation, as Seller and Servicer.
"Schedule of Receivables" means the list of the Standard
Receivables and the Fixed Value Receivables set forth in Schedule A (which
Schedule may be in the form of microfiche).
"Securities Act" means the Securities Act of 1933, as amended.
"Seller" means Chrysler Financial Corporation, in its capacity as
seller under the Sale and Servicing Agreement, and its successor in interest.
"Servicer" means Chrysler Financial Corporation, in its capacity
as servicer under the Sale and Servicing Agreement, and any Successor
Servicer thereunder.
"State" means any one of the 50 States of the United States of
America or the District of Columbia.
"Successor Servicer" has the meaning specified in Section 3.07(e).
"Telerate Page 3750" means the page so designated on the Dow Jones
Telerate Service or such other page as may replace that page on that service,
or such other service as may be nominated as the information vendor, for the
purpose of displaying London interbank offered rates of major banks.
"Trust Certificates" has the meaning assigned to such term in the
Trust Agreement.
"Trust Estate" means all money, instruments, rights and other
property that are subject or intended to be subject to the lien and security
interest of this Indenture for the benefit of the Noteholders (including,
without limitation, all property and interests Granted to the Indenture
Trustee), including all proceeds thereof.
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"Trust Indenture Act" or "TIA" means the Trust Indenture Act of
1939 as in force on the date hereof, unless otherwise specifically provided.
"UCC" means, unless the context otherwise requires, the Uniform
Commercial Code, as in effect in the relevant jurisdiction, as amended from
time to time.
(b) Except as otherwise specified herein or as the context may
otherwise require, capitalized terms used but not otherwise defined herein
have the respective meanings set forth in the Sale and Servicing Agreement
for all purposes of this Indenture.
SECTION 1.02. Incorporation by Reference of Trust Indenture Act.
Whenever this Indenture refers to a provision of the TIA, the provision is
incorporated by reference in and made a part of this Indenture. The following
TIA terms used in this Indenture have the following meanings:
"Commission" means the Securities and Exchange Commission.
"indenture securities" means the Notes.
"indenture security holder" means a Noteholder.
"indenture to be qualified" means this Indenture.
"indenture trustee" or "institutional trustee" means the Indenture
Trustee.
"obligor" on the indenture securities means the Issuer and any
other obligor on the indenture securities.
All other TIA terms used in this Indenture that are defined by the
TIA, defined by TIA reference to another statute or defined by Commission
rule have the meaning assigned to them by such definitions.
SECTION 1.03. Rules of Construction. Unless the context otherwise
requires:
(i) a term has the meaning assigned to it;
(ii) an accounting term not otherwise defined has the
meaning assigned to it in accordance with generally accepted
accounting principles as in effect from time to time;
(iii) "or" is not exclusive;
(iv) "including" means including without limitation;
(v) words in the singular include the plural and words
in the plural include the singular; and
(vi) any agreement, instrument or statute defined or
referred to herein or in any instrument or certificate delivered
in connection herewith means such agreement,
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instrument or statute as from time to time amended, modified or
supplemented and includes (in the case of agreements or
instruments) references to all attachments thereto and instruments
incorporated therein; references to a Person are also to its
permitted successors and assigns.
ARTICLE II
The Notes
SECTION 2.01. Form. The Class A-1 Notes, the Class A-2 Notes, the
Class A-3 Notes and the Class A-4 Notes, in each case together with the
Indenture Trustee's certificate of authentication, shall be in substantially
the form set forth in Exhibit A-1, Exhibit A-2, Exhibit A-3 and Exhibit A-4,
respectively, with such appropriate insertions, omissions, substitutions and
other variations as are required or permitted by this Indenture, and may have
such letters, numbers or other marks of identification and such legends or
endorsements placed thereon as may, consistently herewith, be determined by
the officers executing such Notes, as evidenced by their execution of the
Notes. Any portion of the text of any Note may be set forth on the reverse
thereof, with an appropriate reference thereto on the face of the Note.
The definitive Notes shall be typewritten, printed, lithographed
or engraved or produced by any combination of these methods (with or without
steel engraved borders), all as determined by the officers executing such
Notes, as evidenced by their execution of such Notes.
Each Note shall be dated the date of its authentication. The terms
of the Notes set forth in Exhibit A-1, Exhibit A-2, Exhibit A-3 and Exhibit
A-4 are part of the terms of this Indenture.
SECTION 2.02. Execution, Authentication and Delivery. The Notes
shall be executed on behalf of the Issuer by any of its Authorized Officers.
The signature of any such Authorized Officer on the Notes may be manual or
facsimile.
Notes bearing the manual or facsimile signature of individuals who
were at any time Authorized Officers of the Issuer shall bind the Issuer,
notwithstanding that such individuals or any of them have ceased to hold such
offices prior to the authentication and delivery of such Notes or did not
hold such offices at the date of such Notes.
The Indenture Trustee shall upon Issuer Order authenticate and
deliver Class A-1 Notes for original issue in an aggregate principal amount
of $380,000,000.00, Class A-2 Notes for original issue in an aggregate
principal amount of $640,000,000.00, Class A-3 Notes for original issue in an
aggregate principal amount of $450,000,000.00 and Class A-4 Notes for
original issue in an aggregate principal amount of $214,375,000.00. The
aggregate principal amount of Class A-1 Notes, Class A-2 Notes, Class A-3
Notes and Class A-4 Notes outstanding at any time may not exceed such
respective amounts except as provided in Section 2.06.
Each Note shall be dated the date of its authentication. The Notes
shall be issuable as registered Notes in the minimum denomination of $1,000
and in integral multiples thereof.
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No Note shall be entitled to any benefit under this Indenture or
be valid or obligatory for any purpose, unless there appears on such Note a
certificate of authentication substantially in the form provided for herein
executed by the Indenture Trustee by the manual signature of one of its
authorized signatories, and such certificate upon any Note shall be
conclusive evidence, and the only evidence, that such Note has been duly
authenticated and delivered hereunder.
SECTION 2.03. Temporary Notes. Pending the preparation of
definitive Notes, the Issuer may execute, and upon receipt of an Issuer Order
the Indenture Trustee shall authenticate and deliver, temporary Notes that
are printed, lithographed, typewritten, mimeographed or otherwise produced,
of the tenor of the definitive Notes in lieu of which they are issued and
with such variations not inconsistent with the terms of this Indenture as the
officers executing such Notes may determine, as evidenced by their execution
of such Notes.
If temporary Notes are issued, the Issuer shall cause definitive
Notes to be prepared without unreasonable delay. After the preparation of
definitive Notes, the temporary Notes shall be exchangeable for definitive
Notes upon surrender of the temporary Notes at the office or agency of the
Issuer to be maintained as provided in Section 3.02, without charge to the
Holder. Upon surrender for cancellation of any one or more temporary Notes,
the Issuer shall execute, and the Indenture Trustee shall authenticate and
deliver in exchange therefor, a like principal amount of definitive Notes of
authorized denominations. Until so exchanged, the temporary Notes shall in
all respects be entitled to the same benefits under this Indenture as
definitive Notes.
SECTION 2.04. [Reserved].
SECTION 2.05. Registration; Registration of Transfer and Exchange.
The Issuer shall cause to be kept a register (the "Note Register") in which
the Issuer shall provide for the registration of Notes and the registration
of transfers of Notes. The Indenture Trustee initially shall be the "Note
Registrar" for the purpose of registering Notes and transfers of Notes as
herein provided. Upon any resignation of any Note Registrar, the Issuer shall
promptly appoint a successor or, if it elects not to make such an
appointment, assume the duties of Note Registrar.
If a Person other than the Indenture Trustee is appointed by the
Issuer as Note Registrar, the Issuer will give the Indenture Trustee prompt
written notice of the appointment of such Note Registrar and of the location,
and any change in the location, of the Note Register, and the Indenture
Trustee shall have the right to inspect the Note Register at all reasonable
times and to obtain copies thereof, and the Indenture Trustee shall have the
right to rely upon a certificate executed on behalf of the Note Registrar by
an Executive Officer thereof as to the names and addresses of the Holders of
the Notes and the principal amounts and number of such Notes.
Upon surrender for registration of transfer of any Note at the
office or agency of the Issuer to be maintained as provided in Section 3.02,
if the requirements of Section 8-401(a) of the UCC are met the Issuer shall
execute, and the Indenture Trustee shall authenticate and the Noteholder
shall obtain from the Indenture Trustee, in the name of the designated
transferee or transferees, one or more new Notes of the same Class in any
authorized denominations, of a like aggregate principal amount.
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At the option of the Holder, Notes may be exchanged for other
Notes of the same Class in any authorized denominations, of a like aggregate
principal amount, upon surrender of the Notes to be exchanged at such office
or agency. Whenever any Notes are so surrendered for exchange, if the
requirements of Section 8-401(a) of the UCC are met the Issuer shall execute,
and the Indenture Trustee shall authenticate and the Noteholder shall obtain
from the Indenture Trustee, the Notes which the Noteholder making the
exchange is entitled to receive.
All Notes issued upon any registration of transfer or exchange of
Notes shall be the valid obligations of the Issuer, evidencing the same debt,
and entitled to the same benefits under this Indenture, as the Notes
surrendered upon such registration of transfer or exchange.
Every Note presented or surrendered for registration of transfer
or exchange shall be duly endorsed by, or be accompanied by a written
instrument of transfer in form satisfactory to the Indenture Trustee duly
executed by, the Holder thereof or such Holder's attorney duly authorized in
writing, with such signature guaranteed by an "eligible guarantor
institution" meeting the requirements of the Note Registrar, which
requirements include membership or participation in the Securities Transfer
Agent's Medallion Program ("STAMP") or such other "signature guarantee
program" as may be determined by the Note Registrar in addition to, or in
substitution for, STAMP, all in accordance with the Exchange Act.
No service charge shall be made to a Holder for any registration
of transfer or exchange of Notes, but the Issuer may require payment of a sum
sufficient to cover any tax or other governmental charge that may be imposed
in connection with any registration of transfer or exchange of Notes, other
than exchanges pursuant to Section 2.03 or 9.06 not involving any transfer.
The preceding provisions of this Section notwithstanding, the
Issuer shall not be required to make and the Note Registrar need not register
transfers or exchanges of Notes selected for redemption or of any Note for a
period of 15 days preceding the due date for any payment with respect to the
Note.
SECTION 2.06. Mutilated, Destroyed, Lost or Stolen Notes. If (i)
any mutilated Note is surrendered to the Indenture Trustee, or the Indenture
Trustee receives evidence to its satisfaction of the destruction, loss or
theft of any Note, and (ii) there is delivered to the Indenture Trustee such
security or indemnity as may be required by it to hold the Issuer and the
Indenture Trustee harmless, then, in the absence of notice to the Issuer, the
Note Registrar or the Indenture Trustee that such Note has been acquired by a
bona fide purchaser, and provided that the requirements of Sections 8-405 and
8-406 of the UCC are met, the Issuer shall execute, and upon its request the
Indenture Trustee shall authenticate and deliver, in exchange for or in lieu
of any such mutilated, destroyed, lost or stolen Note, a replacement Note of
the same Class; provided, however, that if any such destroyed, lost or stolen
Note, but not a mutilated Note, shall have become or within seven days shall
be due and payable, or shall have been called for redemption, instead of
issuing a replacement Note, the Issuer may pay such destroyed, lost or stolen
Note when so due or payable or upon the Redemption Date without surrender
thereof. If, after the delivery of such replacement Note or payment of a
destroyed, lost or stolen Note pursuant to the proviso to the preceding
sentence, a bona fide purchaser of the original Note in
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lieu of which such replacement Note was issued presents for payment such
original Note, the Issuer and the Indenture Trustee shall be entitled to
recover such replacement Note (or such payment) from the Person to whom it
was delivered or any Person taking such replacement Note from such Person to
whom such replacement Note was delivered or any assignee of such Person,
except a bona fide purchaser, and shall be entitled to recover upon the
security or indemnity provided therefor to the extent of any loss, damage,
cost or expense incurred by the Issuer or the Indenture Trustee in connection
therewith.
Upon the issuance of any replacement Note under this Section, the
Issuer may require the payment by the Holder of such Note of a sum sufficient
to cover any tax or other governmental charge that may be imposed in relation
thereto and any other reasonable expenses (including the fees and expenses of
the Indenture Trustee) connected therewith.
Every replacement Note issued pursuant to this Section in
replacement of any mutilated, destroyed, lost or stolen Note shall constitute
an original additional contractual obligation of the Issuer, whether or not
the mutilated, destroyed, lost or stolen Note shall be at any time
enforceable by anyone, and shall be entitled to all the benefits of this
Indenture equally and proportionately with any and all other Notes duly
issued hereunder.
The provisions of this Section are exclusive and shall preclude
(to the extent lawful) all other rights and remedies with respect to the
replacement or payment of mutilated, destroyed, lost or stolen Notes.
SECTION 2.07. Persons Deemed Owner. Prior to due presentment for
registration of transfer of any Note, the Issuer, the Indenture Trustee and
any agent of the Issuer or the Indenture Trustee may treat the Person in
whose name any Note is registered (as of the day of determination) as the
owner of such Note for the purpose of receiving payments of principal of and
interest, if any, on such Note and for all other purposes whatsoever, whether
or not such Note be overdue, and none of the Issuer, the Indenture Trustee or
any agent of the Issuer or the Indenture Trustee shall be affected by notice
to the contrary.
SECTION 2.08. Payment of Principal and Interest; Defaulted
Interest. i) The Class A-1 Notes, the Class A-2
Notes, the Class A-3 Notes and the Class A-4 Notes shall accrue interest at
the Class A-1 Interest Rate, the Class A-2 Interest Rate, the Class A-3
Interest Rate and the Class A-4 Interest Rate, respectively, as set forth in
Exhibits A-1, A-2, A-3 and A-4, respectively, and such interest shall be
payable on each Distribution Date as specified therein, subject to Section
3.01. Any installment of interest or principal payable on a Note that is
punctually paid or duly provided for by the Issuer on the applicable
Distribution Date shall be paid to the Person in whose name such Note (or one
or more Predecessor Notes) is registered on the Record Date by check mailed
first-class postage prepaid to such Person's address as it appears on the
Note Register on such Record Date, except that, unless Definitive Notes have
been issued pursuant to Section 2.13, with respect to Notes registered on the
Record Date in the name of the nominee of the Clearing Agency (initially,
such nominee to be Cede & Co.), payment will be made by wire transfer in
immediately available funds to the account designated by such nominee and
except for the final installment of principal payable with respect to such
Note on a Distribution Date or on the applicable class final scheduled
Distribution Date (and
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except for the Redemption Price for any Note called for redemption pursuant
to Section 10.01) which shall be payable as provided below. The funds
represented by any such checks returned undelivered shall be held in
accordance with Section 3.03.
(b) The principal of each Note shall be payable in installments on
each Distribution Date as provided in the forms of the Notes set forth in
Exhibits A-1, A-2, A-3 and A-4. Notwithstanding the foregoing, the entire
unpaid principal amount of the Notes shall be due and payable, if not
previously paid, on the date on which an Event of Default shall have occurred
and be continuing, if the Indenture Trustee or Holders of the Notes
representing not less than a majority of the Outstanding Amount of the Notes
have declared the Notes to be immediately due and payable in the manner
provided in Section 5.02. All principal payments on each Class of Notes shall
be made pro rata to the Noteholders of such Class entitled thereto. The
Indenture Trustee shall notify the Person in whose name a Note is registered
at the close of business on the Record Date preceding the Distribution Date
on which the Issuer expects that the final installment of principal of and
interest on such Note will be paid. Such notice shall be mailed or
transmitted by facsimile prior to such final Distribution Date and shall
specify that such final installment will be payable only upon presentation
and surrender of such Note and shall specify the place where such Note may be
presented and surrendered for payment of such installment. Notices in
connection with redemptions of Notes shall be mailed to Noteholders as
provided in Section 10.02.
(c) If the Issuer defaults in a payment of interest on the Notes,
the Issuer shall pay defaulted interest (plus interest on such defaulted
interest to the extent lawful) at the applicable Interest Rate in any lawful
manner. The Issuer may pay such defaulted interest to the persons who are
Noteholders on a subsequent special record date, which date shall be at least
five Business Days prior to the payment date. The Issuer shall fix or cause
to be fixed any such special record date and payment date, and, at least 15
days before any such special record date, the Issuer shall mail to each
Noteholder a notice that states the special record date, the payment date and
the amount of defaulted interest to be paid.
SECTION 2.09. Cancellation. All Notes surrendered for payment,
registration of transfer, exchange or redemption shall, if surrendered to any
Person other than the Indenture Trustee, be delivered to the Indenture
Trustee and shall be promptly cancelled by the Indenture Trustee. The Issuer
may at any time deliver to the Indenture Trustee for cancellation any Notes
previously authenticated and delivered hereunder which the Issuer may have
acquired in any manner whatsoever, and all Notes so delivered shall be
promptly cancelled by the Indenture Trustee. No Notes shall be authenticated
in lieu of or in exchange for any Notes cancelled as provided in this
Section, except as expressly permitted by this Indenture. All cancelled Notes
may be held or disposed of by the Indenture Trustee in accordance with its
standard retention or disposal policy as in effect at the time unless the
Issuer shall direct by an Issuer Order that they be returned to it; provided,
that such Issuer Order is timely and the Notes have not been previously
disposed of by the Indenture Trustee.
SECTION 2.10. Release of Collateral. Subject to Section 11.01 and
the terms of the Basic Documents, the Indenture Trustee shall release
property from the lien of this Indenture only upon receipt of an Issuer
Request accompanied by an Officer's Certificate, an Opinion of
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Counsel and Independent Certificates in accordance with TIA ss.ss. 314(c) and
314(d)(1) or an Opinion of Counsel in lieu of such Independent Certificates
to the effect that the TIA does not require any such Independent
Certificates.
SECTION 2.11. Book-Entry Notes. The Notes, upon original issuance,
will be issued in the form of typewritten Notes representing the Book-Entry
Notes, to be delivered to The Depository Trust Company, the initial Clearing
Agency, by, or on behalf of, the Issuer. The Book-Entry Notes shall be
registered initially on the Note Register in the name of Cede & Co., the
nominee of the initial Clearing Agency, and no Owner thereof will receive a
definitive Note representing such Note Owner's interest in such Note, except
as provided in Section 2.13. Unless and until definitive, fully registered
Notes (the "Definitive Notes") have been issued to such Note Owners pursuant
to Section 2.13:
(i) the provisions of this Section shall be in full
force and effect;
(ii) the Note Registrar and the Indenture Trustee shall
be entitled to deal with the Clearing Agency for all purposes of
this Indenture (including the payment of principal of and interest
on the Notes and the giving of instructions or directions
hereunder) as the sole holder of the Notes, and shall have no
obligation to the Note Owners;
(iii) to the extent that the provisions of this Section
conflict with any other provisions of this Indenture, the
provisions of this Section shall control;
(iv) the rights of Note Owners shall be exercised only
through the Clearing Agency and shall be limited to those
established by law and agreements between such Note Owners and the
Clearing Agency and/or the Clearing Agency Participants pursuant
to the Note Depository Agreement. Unless and until Definitive
Notes are issued pursuant to Section 2.13, the initial Clearing
Agency will make book-entry transfers among the Clearing Agency
Participants and receive and transmit payments of principal of and
interest on the Notes to such Clearing Agency Participants; and
(v) whenever this Indenture requires or permits actions
to be taken based upon instructions or directions of Holders of
Notes evidencing a specified percentage of the Outstanding Amount
of the Notes, the Clearing Agency shall be deemed to represent
such percentage only to the extent that it has received
instructions to such effect from Note Owners and/or Clearing
Agency Participants owning or representing, respectively, such
required percentage of the beneficial interest in the Notes and
has delivered such instructions to the Indenture Trustee.
SECTION 2.12. Notices to Clearing Agency. Whenever a notice or
other communication to the Noteholders is required under this Indenture,
unless and until Definitive Notes shall have been issued to such Note Owners
pursuant to Section 2.13, the Indenture Trustee shall give all such notices
and communications specified herein to be given to Holders of the Notes to
the Clearing Agency, and shall have no obligation to such Note Owners.
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SECTION 2.13. Definitive Notes. If (i) the Administrator advises
the Indenture Trustee in writing that the Clearing Agency is no longer
willing or able to properly discharge its responsibilities with respect to
the Book-Entry Notes and the Administrator is unable to locate a qualified
successor, (ii) the Administrator at its option advises the Indenture Trustee
in writing that it elects to terminate the book-entry system through the
Clearing Agency or (iii) after the occurrence of an Event of Default or a
Servicer Default, Owners of the Book-Entry Notes representing beneficial
interests aggregating at least a majority of the Outstanding Amount of such
Notes advise the Clearing Agency in writing that the continuation of a
book-entry system through the Clearing Agency is no longer in the best
interests of such Note Owners, then the Clearing Agency shall notify all Note
Owners and the Indenture Trustee of the occurrence of any such event and of
the availability of Definitive Notes to Note Owners requesting the same. Upon
surrender to the Indenture Trustee of the typewritten Notes representing the
Book-Entry Notes by the Clearing Agency, accompanied by registration
instructions, the Issuer shall execute and the Indenture Trustee shall
authenticate the Definitive Notes in accordance with the instructions of the
Clearing Agency. None of the Issuer, the Note Registrar or the Indenture
Trustee shall be liable for any delay in delivery of such instructions and
may conclusively rely on, and shall be protected in relying on, such
instructions. Upon the issuance of Definitive Notes, the Indenture Trustee
shall recognize the Holders of the Definitive Notes as Noteholders.
SECTION 2.14. Tax Treatment. The Issuer has entered into this
Indenture, and the Notes will be issued, with the intention that, for all
purposes including federal, state and local income, single business and
franchise tax purposes, the Notes will qualify as indebtedness secured by the
Trust Estate. The Issuer, by entering into this Indenture, and each
Noteholder, by its acceptance of a Note (and each Note Owner by its
acceptance of an interest in the applicable Book-Entry Note), agree to treat
the Notes for all purposes including federal, state and local income, single
business and franchise tax purposes as indebtedness of the Issuer.
ARTICLE III
Covenants
SECTION 3.01. Payment of Principal and Interest. The Issuer will
duly and punctually pay the principal of and interest, if any, on the Notes
in accordance with the terms of the Notes and this Indenture. Without
limiting the foregoing, subject to Section 8.02(c), the Issuer will cause to
be distributed all amounts on deposit in the Collection Account and allocated
for distribution to the Noteholders on a Distribution Date pursuant to the
Sale and Servicing Agreement (i) for the benefit of the Class A-1 Notes, to
the Class A-1 Noteholders, (ii) for the benefit of the Class A-2 Notes, to
the Class A-2 Noteholders, (iii) for the benefit of the Class A-3 Notes, to
the Class A-3 Noteholders and (iv) for the benefit of the Class A-4 Notes, to
the Class A-4 Noteholders. Amounts properly withheld under the Code by any
Person from a payment to any Noteholder of interest and/or principal shall be
considered as having been paid by the Issuer to such Noteholder for all
purposes of this Indenture.
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SECTION 3.02. Maintenance of Office or Agency. The Issuer will
maintain in the Borough of Manhattan, The City of New York, an office or
agency where Notes may be surrendered for registration of transfer or
exchange, and where notices and demands to or upon the Issuer in respect of
the Notes and this Indenture may be served. The Issuer hereby initially
appoints the Indenture Trustee to serve as its agent for the foregoing
purposes. The Issuer will give prompt written notice to the Indenture Trustee
of the location, and of any change in the location, of any such office or
agency. If at any time the Issuer shall fail to maintain any such office or
agency or shall fail to furnish the Indenture Trustee with the address
thereof, such surrenders, notices and demands may be made or served at the
Corporate Trust Office, and the Issuer hereby appoints the Indenture Trustee
as its agent to receive all such surrenders, notices and demands.
SECTION 3.03. Money for Payments To Be Held in Trust. As provided
in Section 8.02(a) and (b), all payments of amounts due and payable with
respect to any Notes that are to be made from amounts withdrawn from the
Collection Account pursuant to Section 8.02(c) shall be made on behalf of the
Issuer by the Indenture Trustee or by another Paying Agent, and no amounts so
withdrawn from the Collection Account for payments of Notes shall be paid
over to the Issuer except as provided in this Section.
On or before the Business Day preceding each Distribution Date and
Redemption Date, the Issuer shall allocate or cause to be allocated in the
Collection Account for distribution to the Noteholders an aggregate sum
sufficient to pay the amounts then becoming due under the Notes, such sum to
be held in trust for the benefit of the Persons entitled thereto, and (unless
the Paying Agent is the Indenture Trustee) shall promptly notify the
Indenture Trustee of its action or failure so to act.
The Issuer will cause each Paying Agent other than the Indenture
Trustee to execute and deliver to the Indenture Trustee an instrument in
which such Paying Agent shall agree with the Indenture Trustee (and if the
Indenture Trustee acts as Paying Agent, it hereby so agrees), subject to the
provisions of this Section, that such Paying Agent will:
(i) hold all sums held by it for the payment of amounts
due with respect to the Notes in trust for the benefit of the
Persons entitled thereto until such sums shall be paid to such
Persons or otherwise disposed of as herein provided and pay such
sums to such Persons as herein provided;
(ii) give the Indenture Trustee notice of any default by
the Issuer (or any other obligor upon the Notes) of which it has
actual knowledge in the making of any payment required to be made
with respect to the Notes;
(iii) at any time during the continuance of any such
default, upon the written request of the Indenture Trustee,
forthwith pay to the Indenture Trustee all sums so held in trust
by such Paying Agent;
(iv) immediately resign as a Paying Agent and forthwith
pay to the Indenture Trustee all sums held by it in trust for the
payment of Notes if at any time it ceases to
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meet the standards required to be met by a Paying Agent at the
time of its appointment; and
(v) comply with all requirements of the Code with
respect to the withholding from any payments made by it on any
Notes of any applicable withholding taxes imposed thereon and with
respect to any applicable reporting requirements in connection
therewith.
The Issuer may at any time, for the purpose of obtaining the
satisfaction and discharge of this Indenture or for any other purpose, by
Issuer Order direct any Paying Agent to pay to the Indenture Trustee all sums
held in trust by such Paying Agent, such sums to be held by the Indenture
Trustee upon the same trusts as those upon which the sums were held by such
Paying Agent; and upon such payment by any Paying Agent to the Indenture
Trustee, such Paying Agent shall be released from all further liability with
respect to such money.
Subject to applicable laws with respect to escheat of funds, any
money held by the Indenture Trustee or any Paying Agent in trust for the
payment of any amount due with respect to any Note and remaining unclaimed
for two years after such amount has become due and payable shall be
discharged from such trust and be paid to the Issuer on Issuer Request; and
the Holder of such Note shall thereafter, as an unsecured general creditor,
look only to the Issuer for payment thereof (but only to the extent of the
amounts so paid to the Issuer), and all liability of the Indenture Trustee or
such Paying Agent with respect to such trust money shall thereupon cease;
provided, however, that the Indenture Trustee or such Paying Agent, before
being required to make any such repayment, shall at the expense and direction
of the Issuer cause to be published once, in a newspaper published in the
English language, customarily published on each Business Day and of general
circulation in The City of New York, notice that such money remains unclaimed
and that, after a date specified therein, which shall not be less than 30
days from the date of such publication, any unclaimed balance of such money
then remaining will be repaid to the Issuer. The Indenture Trustee shall also
adopt and employ, at the expense and direction of the Issuer, any other
reasonable means of notification of such repayment (including, but not
limited to, mailing notice of such repayment to Holders whose Notes have been
called but have not been surrendered for redemption or whose right to or
interest in moneys due and payable but not claimed is determinable from the
records of the Indenture Trustee or of any Paying Agent, at the last address
of record for each such Holder).
SECTION 3.04. Existence. The Issuer will keep in full effect its
existence, rights and franchises as a business trust under the laws of the
State of Delaware (unless it becomes, or any successor Issuer hereunder is or
becomes, organized under the laws of any other State or of the United States
of America, in which case the Issuer will keep in full effect its existence,
rights and franchises under the laws of such other jurisdiction) and will
obtain and preserve its qualification to do business in each jurisdiction in
which such qualification is or shall be necessary to protect the validity and
enforceability of this Indenture, the Notes, the Collateral and each other
instrument or agreement included in the Trust Estate.
SECTION 3.05. Protection of Trust Estate. The Issuer will from
time to time execute and deliver all such supplements and amendments hereto
and all such financing
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statements, continuation statements, instruments of further assurance and
other instruments, and will take such other action necessary or advisable to:
(i) maintain or preserve the lien and security interest
(and the priority thereof) of this Indenture or carry out more
effectively the purposes hereof;
(ii) perfect, publish notice of or protect the validity
of any Grant made or to be made by this Indenture;
(iii) enforce any of the Collateral; or
(iv) preserve and defend title to the Trust Estate and
the rights of the Indenture Trustee and the Noteholders in such
Trust Estate against the claims of all persons and parties.
The Issuer hereby designates the Indenture Trustee its agent and
attorney-in-fact to execute any financing statement, continuation statement
or other instrument required to be executed pursuant to this Section 3.05.
SECTION 3.06. Opinions as to Trust Estate. i) On the Closing Date,
the Issuer shall furnish to the Indenture Trustee an Opinion of Counsel
either stating that, in the opinion of such counsel, such action has been
taken with respect to the recording and filing of this Indenture, any
indentures supplemental hereto, and any other requisite documents, and with
respect to the execution and filing of any financing statements and
continuation statements, as are necessary to perfect and make effective the
lien and security interest of this Indenture and reciting the details of such
action, or stating that, in the opinion of such counsel, no such action is
necessary to make such lien and security interest effective.
(b) On or before March 31, in each calendar year, beginning in
1999, the Issuer shall furnish to the Indenture Trustee an Opinion of Counsel
either stating that, in the opinion of such counsel, such action has been
taken with respect to the recording, filing, re-recording and refiling of
this Indenture, any indentures supplemental hereto and any other requisite
documents and with respect to the execution and filing of any financing
statements and continuation statements as is necessary to maintain the lien
and security interest created by this Indenture and reciting the details of
such action, or stating that in the opinion of such counsel no such action is
necessary to maintain such lien and security interest. Such Opinion of
Counsel shall also describe the recording, filing, re-recording and refiling
of this Indenture, any indentures supplemental hereto and any other requisite
documents and the execution and filing of any financing statements and
continuation statements that will, in the opinion of such counsel, be
required to maintain the lien and security interest of this Indenture until
March 31 in the following calendar year.
SECTION 3.07. Performance of Obligations; Servicing of
Receivables. i) The Issuer will not take any action and will use its best
efforts not to permit any action to be taken by others that would release any
Person from any of such Person's material covenants or obligations under any
instrument or agreement included in the Trust Estate or that would result in
the amendment, hypothecation, subordination, termination or discharge of, or
impair the validity or
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effectiveness of, any such instrument or agreement, except as expressly
provided in this Indenture, the Sale and Servicing Agreement or such other
instrument or agreement.
(b) The Issuer may contract with other Persons to assist it in
performing its duties under this Indenture, and any performance of such
duties by a Person identified to the Indenture Trustee in an Officer's
Certificate of the Issuer shall be deemed to be action taken by the Issuer.
Initially, the Issuer has contracted with the Servicer and the Administrator
to assist the Issuer in performing its duties under this Indenture.
(c) The Issuer will punctually perform and observe all of its
obligations and agreements contained in this Indenture, the Basic Documents
and in the instruments and agreements included in the Trust Estate, including
but not limited to filing or causing to be filed all UCC financing statements
and continuation statements required to be filed by the terms of this
Indenture and the Sale and Servicing Agreement in accordance with and within
the time periods provided for herein and therein. Except as otherwise
expressly provided therein, the Issuer shall not waive, amend, modify,
supplement or terminate any Basic Document or any provision thereof without
the consent of the Indenture Trustee or the Holders of at least a majority of
the Outstanding Amount of the Notes.
(d) If the Issuer shall have knowledge of the occurrence of a
Servicer Default under the Sale and Servicing Agreement, the Issuer shall
promptly notify the Indenture Trustee and the Rating Agencies thereof, and
shall specify in such notice the action, if any, the Issuer is taking with
respect to such default. If a Servicer Default shall arise from the failure
of the Servicer to perform any of its duties or obligations under the Sale
and Servicing Agreement with respect to the Receivables, the Issuer shall
take all reasonable steps available to it to remedy such failure.
(e) As promptly as possible after the giving of notice of
termination to the Servicer of the Servicer's rights and powers pursuant to
Section 8.01 of the Sale and Servicing Agreement, the Issuer shall appoint a
successor servicer (the "Successor Servicer"), and such Successor Servicer
shall accept its appointment by a written assumption in a form acceptable to
the Indenture Trustee. In the event that a Successor Servicer has not been
appointed and accepted its appointment at the time when the Servicer ceases
to act as Servicer, the Indenture Trustee without further action shall
automatically be appointed the Successor Servicer. The Indenture Trustee may
resign as the Servicer by giving written notice of such resignation to the
Issuer and in such event will be released from such duties and obligations,
such release not to be effective until the date a new servicer enters into a
servicing agreement with the Issuer as provided below. Upon delivery of any
such notice to the Issuer, the Issuer shall obtain a new servicer as the
Successor Servicer under the Sale and Servicing Agreement. Any Successor
Servicer other than the Indenture Trustee shall (i) be an established
financial institution having a net worth of not less than $100,000,000 and
whose regular business includes the servicing of Contracts and (ii) enter
into a servicing agreement with the Issuer having substantially the same
provisions as the provisions of the Sale and Servicing Agreement applicable
to the Servicer. If within 30 days after the delivery of the notice referred
to above, the Issuer shall not have obtained such a new servicer, the
Indenture Trustee may appoint, or may petition a court of competent
jurisdiction to appoint, a Successor Servicer. In connection with any such
appointment, the Indenture Trustee may make such arrangements for the
compensation of such successor as it and such successor
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shall agree, subject to the limitations set forth below and in the Sale and
Servicing Agreement, and in accordance with Section 8.02 of the Sale and
Servicing Agreement, the Issuer shall enter into an agreement with such
successor for the servicing of the Receivables (such agreement to be in form
and substance satisfactory to the Indenture Trustee). If the Indenture
Trustee shall succeed to the Servicer's duties as servicer of the Receivables
as provided herein, it shall do so in its individual capacity and not in its
capacity as Indenture Trustee and, accordingly, the provisions of Article VI
hereof shall be inapplicable to the Indenture Trustee in its duties as the
successor to the Servicer and the servicing of the Receivables. In case the
Indenture Trustee shall become successor to the Servicer under the Sale and
Servicing Agreement, the Indenture Trustee shall be entitled to appoint as
Servicer any one of its affiliates, provided that it shall be fully liable
for the actions and omissions of such affiliate in such capacity as Successor
Servicer.
(f) Upon any termination of the Servicer's rights and powers
pursuant to the Sale and Servicing Agreement, the Issuer shall promptly
notify the Indenture Trustee. As soon as a Successor Servicer is appointed,
the Issuer shall notify the Indenture Trustee of such appointment, specifying
in such notice the name and address of such Successor Servicer.
(g) Without derogating from the absolute nature of the assignment
granted to the Indenture Trustee under this Indenture or the rights of the
Indenture Trustee hereunder, the Issuer agrees (i) that it will not, without
the prior written consent of the Indenture Trustee or the Holders of at least
a majority in Outstanding Amount of the Notes, amend, modify, waive,
supplement, terminate or surrender, or agree to any amendment, modification,
supplement, termination, waiver or surrender of, the terms of any Collateral
(except to the extent otherwise provided in the Sale and Servicing Agreement)
or the Basic Documents, or waive timely performance or observance by the
Servicer or the Seller under the Sale and Servicing Agreement; and (ii) that
any such amendment shall not (A) increase or reduce in any manner the amount
of, or accelerate or delay the timing of, distributions that are required to
be made for the benefit of the Noteholders or (B) reduce the aforesaid
percentage of the Notes that is required to consent to any such amendment,
without the consent of the Holders of all the Outstanding Notes. If any such
amendment, modification, supplement or waiver shall be so consented to by the
Indenture Trustee or such Holders, the Issuer agrees, promptly following a
request by the Indenture Trustee to do so, to execute and deliver, in its own
name and at its own expense, such agreements, instruments, consents and other
documents as the Indenture Trustee may deem necessary or appropriate in the
circumstances.
SECTION 3.08. Negative Covenants. So long as any Notes are
Outstanding, the Issuer shall not:
(i) except as expressly permitted by this Indenture, the
Purchase Agreement or the Sale and Servicing Agreement, sell,
transfer, exchange or otherwise dispose of any of the properties
or assets of the Issuer, including those included in the Trust
Estate, unless directed to do so by the Indenture Trustee;
(ii) claim any credit on, or make any deduction from the
principal or interest payable in respect of, the Notes (other than
amounts properly withheld from such payments under the Code) or
assert any claim against any present or former Noteholder
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by reason of the payment of the taxes levied or assessed upon any
part of the Trust Estate; or
(iii) (A) permit the validity or effectiveness of this
Indenture to be impaired, or permit the lien of this Indenture to
be amended, hypothecated, subordinated, terminated or discharged,
or permit any Person to be released from any covenants or
obligations with respect to the Notes under this Indenture except
as may be expressly permitted hereby, (B) permit any lien, charge,
excise, claim, security interest, mortgage or other encumbrance
(other than the lien of this Indenture) to be created on or extend
to or otherwise arise upon or burden the Trust Estate or any part
thereof or any interest therein or the proceeds thereof (other
than tax liens, mechanics' liens and other liens that arise by
operation of law, in each case on any of the Financed Vehicles and
arising solely as a result of an action or omission of the related
Obligor) or (C) permit the lien of this Indenture not to
constitute a valid first priority (other than with respect to any
such tax, mechanics' or other lien) security interest in the Trust
Estate.
SECTION 3.09. Annual Statement as to Compliance. The Issuer will
deliver to the Indenture Trustee, within 120 days after the end of each
fiscal year of the Issuer (commencing with the fiscal year 1999), an
Officer's Certificate stating, as to the Authorized Officer signing such
Officer's Certificate, that:
(i) a review of the activities of the Issuer during such
year and of its performance under this Indenture has been made
under such Authorized Officer's supervision; and
(ii) to the best of such Authorized Officer's knowledge,
based on such review, the Issuer has complied with all conditions
and covenants under this Indenture throughout such year or, if
there has been a default in its compliance with any such condition
or covenant, specifying each such default known to such Authorized
Officer and the nature and status thereof.
SECTION 3.10. Issuer May Consolidate, etc., Only on Certain Terms.
i) The Issuer shall not consolidate or merge with or into any other Person,
unless:
(i) the Person (if other than the Issuer) formed by or
surviving such consolidation or merger shall be a Person organized
and existing under the laws of the United States of America or any
State and shall expressly assume, by an indenture supplemental
hereto, executed and delivered to the Indenture Trustee, in form
satisfactory to the Indenture Trustee, the due and punctual
payment of the principal of and interest on all Notes and the
performance or observance of every agreement and covenant of this
Indenture on the part of the Issuer to be performed or observed,
all as provided herein;
(ii) immediately after giving effect to such
transaction, no Default or Event of Default shall have occurred
and be continuing;
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(iii) the Rating Agency Condition shall have been
satisfied with respect to such transaction;
(iv) the Issuer shall have received an Opinion of
Counsel (and shall have delivered copies thereof to the Indenture
Trustee) to the effect that such transaction will not have any
material adverse tax consequence to the Issuer, any Noteholder or
any Certificateholder;
(v) any action that is necessary to maintain the lien
and security interest created by this Indenture shall have been
taken; and
(vi) the Issuer shall have delivered to the Indenture
Trustee an Officer's Certificate and an Opinion of Counsel each
stating that such consolidation or merger and such supplemental
indenture comply with this Article III and that all conditions
precedent herein provided for relating to such transaction have
been complied with (including any filing required by the Exchange
Act).
(b) The Issuer shall not convey or transfer any of its properties
or assets, including those included in the Trust Estate, to any Person,
unless:
(i) the Person that acquires by conveyance or transfer
the properties and assets of the Issuer the conveyance or transfer
of which is hereby restricted (A) shall be a United States citizen
or a Person organized and existing under the laws of the United
States of America or any State, (B) expressly assumes, by an
indenture supplemental hereto, executed and delivered to the
Indenture Trustee, in form satisfactory to the Indenture Trustee,
the due and punctual payment of the principal of and interest on
all Notes and the performance or observance of every agreement and
covenant of this Indenture on the part of the Issuer to be
performed or observed, all as provided herein, (C) expressly
agrees by means of such supplemental indenture that all right,
title and interest so conveyed or transferred shall be subject and
subordinate to the rights of Holders of the Notes, (D) unless
otherwise provided in such supplemental indenture, expressly
agrees to indemnify, defend and hold harmless the Issuer against
and from any loss, liability or expense arising under or related
to this Indenture and the Notes and (E) expressly agrees by means
of such supplemental indenture that such Person (or if a group of
Persons, then one specified Person) shall make all filings with
the Commission (and any other appropriate Person) required by the
Exchange Act in connection with the Notes;
(ii) immediately after giving effect to such
transaction, no Default or Event of Default shall have occurred
and be continuing;
(iii) the Rating Agency Condition shall have been
satisfied with respect to such transaction;
(iv) the Issuer shall have received an Opinion of
Counsel (and shall have delivered copies thereof to the Indenture
Trustee) to the effect that such transaction will
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not have any material adverse federal income or Michigan income or
single business tax consequence to the Issuer, any Noteholder or
any Certificateholder;
(v) any action that is necessary to maintain the lien
and security interest created by this Indenture shall have been
taken; and
(vi) the Issuer shall have delivered to the Indenture
Trustee an Officer's Certificate and an Opinion of Counsel each
stating that such conveyance or transfer and such supplemental
indenture comply with this Article III and that all conditions
precedent herein provided for relating to such transaction have
been complied with (including any filing required by the Exchange
Act).
SECTION 3.11. Successor or Transferee. i) Upon any consolidation
or merger of the Issuer in accordance with Section 3.10(a), the Person formed
by or surviving such consolidation or merger (if other than the Issuer) shall
succeed to, and be substituted for, and may exercise every right and power
of, the Issuer under this Indenture with the same effect as if such Person
had been named as the Issuer herein.
(b) Upon a conveyance or transfer of all the assets and properties
of the Issuer pursuant to Section 3.10(b), Premier Auto Trust 1998-5 will be
released from every covenant and agreement of this Indenture to be observed
or performed on the part of the Issuer with respect to the Notes immediately
upon the delivery of written notice to the Indenture Trustee stating that
Premier Auto Trust 1998-5 is to be so released.
SECTION 3.12. No Other Business. The Issuer shall not engage in
any business other than financing, purchasing, owning, selling and managing
the Receivables in the manner contemplated by this Indenture and the Basic
Documents and activities incidental thereto. The Issuer shall not fund the
purchase of any new Contracts.
SECTION 3.13. No Borrowing. The Issuer shall not issue, incur,
assume, guarantee or otherwise become liable, directly or indirectly, for any
indebtedness.
SECTION 3.14. Servicer's Obligations. The Issuer shall cause the
Servicer to comply with Sections 4.09, 4.10, 4.11 and 5.09(b) and Article IX
of the Sale and Servicing Agreement.
SECTION 3.15. Guarantees, Loans, Advances and Other Liabilities.
Except as contemplated by the Sale and Servicing Agreement or this Indenture,
the Issuer shall not make any loan or advance or credit to, or guarantee
(directly or indirectly or by an instrument having the effect of assuring
another's payment or performance on any obligation or capability of so doing
or otherwise), endorse or otherwise become contingently liable, directly or
indirectly, in connection with the obligations, stocks or dividends of, or
own, purchase, repurchase or acquire (or agree contingently to do so) any
stock, obligations, assets or securities of, or any other interest in, or
make any capital contribution to, any other Person.
SECTION 3.16. Capital Expenditures. The Issuer shall not make any
expenditure (by long-term or operating lease or otherwise) for capital assets
(either realty or personalty).
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SECTION 3.17. Removal of Administrator. So long as any Notes are
Outstanding, the Issuer shall not remove the Administrator without cause
unless the Rating Agency Condition shall have been satisfied in connection
with such removal.
SECTION 3.18. Restricted Payments. The Issuer shall not, directly
or indirectly, (i) pay any dividend or make any distribution (by reduction of
capital or otherwise), whether in cash, property, securities or a combination
thereof, to the Owner Trustee or any owner of a beneficial interest in the
Issuer or otherwise with respect to any ownership or equity interest or
security in or of the Issuer or to the Servicer, (ii) redeem, purchase,
retire or otherwise acquire for value any such ownership or equity interest
or security or (iii) set aside or otherwise segregate any amounts for any
such purpose; provided, however, that the Issuer may make, or cause to be
made, (x) distributions as contemplated by, and to the extent funds are
available for such purpose under, the Sale and Servicing Agreement or the
Trust Agreement and (y) payments to the Indenture Trustee pursuant to Section
1(a)(ii) of the Administration Agreement. The Issuer will not, directly or
indirectly, make payments to or distributions from the Collection Account
except in accordance with this Indenture and the Basic Documents.
SECTION 3.19. Notice of Events of Default. The Issuer shall give
the Indenture Trustee and the Rating Agencies prompt written notice of each
Event of Default hereunder, each default on the part of the Servicer or the
Seller of its obligations under the Sale and Servicing Agreement and each
default on the part of the Company or the Seller of its obligations under the
Purchase Agreement.
SECTION 3.20. Further Instruments and Acts. Upon request of the
Indenture Trustee, the Issuer will execute and deliver such further
instruments and do such further acts as may be reasonably necessary or proper
to carry out more effectively the purpose of this Indenture.
ARTICLE IV
Satisfaction and Discharge
SECTION 4.01. Satisfaction and Discharge of Indenture. This
Indenture shall cease to be of further effect with respect to the Notes
except as to (i) rights of registration of transfer and exchange, (ii)
substitution of mutilated, destroyed, lost or stolen Notes, (iii) rights of
Noteholders to receive payments of principal thereof and interest thereon,
(iv) Sections 3.03, 3.04, 3.05, 3.08, 3.10, 3.12 and 3.13, (v) the rights,
obligations and immunities of the Indenture Trustee hereunder (including the
rights of the Indenture Trustee under Section 6.07 and the obligations of the
Indenture Trustee under Section 4.02) and (vi) the rights of Noteholders as
beneficiaries hereof with respect to the property so deposited with the
Indenture Trustee payable to all or any of them, and the Indenture Trustee,
on demand of and at the expense of the Issuer, shall execute proper
instruments acknowledging satisfaction and discharge of this Indenture with
respect to the Notes, when:
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(A) either:
(1) all Notes theretofore authenticated and delivered
(other than (i) Notes that have been destroyed, lost or stolen and
that have been replaced or paid as provided in Section 2.06 and
(ii) Notes for whose payment money has theretofore been deposited
in trust or segregated and held in trust by the Issuer and
thereafter repaid to the Issuer or discharged from such trust, as
provided in Section 3.03) have been delivered to the Indenture
Trustee for cancellation; or
(2) all Notes not theretofore delivered to the Indenture
Trustee for cancellation:
a. have become due and payable,
b. will become due and payable at the Class
A-4 Final Scheduled Distribution Date within one year,
or
c. are to be called for redemption within one
year under arrangements satisfactory to the Indenture
Trustee for the giving of notice of redemption by the
Indenture Trustee in the name, and at the expense, of
the Issuer,
and the Issuer, in the case of a., b. or c. above, has
irrevocably deposited or caused to be irrevocably
deposited with the Indenture Trustee cash or direct
obligations of or obligations guaranteed by the United
States of America (which will mature prior to the date
such amounts are payable), in trust for such purpose, in
an amount sufficient to pay and discharge the entire
indebtedness on such Notes not theretofore delivered to
the Indenture Trustee for cancellation when due to the
applicable final scheduled Distribution Date or
Redemption Date (if Notes shall have been called for
redemption pursuant to Section 10.01), as the case may
be;
(B) the Issuer has paid or caused to be paid all other
sums payable hereunder by the Issuer; and
(C) the Issuer has delivered to the Indenture Trustee an
Officer's Certificate, an Opinion of Counsel and (if required by
the TIA or the Indenture Trustee) an Independent Certificate from
a firm of certified public accountants, each meeting the
applicable requirements of Section 11.01(a) and, subject to
Section 11.02, each stating that all conditions precedent herein
provided for relating to the satisfaction and discharge of this
Indenture have been complied with.
SECTION 4.02. Application of Trust Money. All moneys deposited
with the Indenture Trustee pursuant to Section 4.01 hereof shall be held in
trust and applied by it, in accordance with the provisions of the Notes and
this Indenture, to the payment, either directly or through any Paying Agent,
as the Indenture Trustee may determine, to the Holders of the particular
Notes for the payment or redemption of which such moneys have been deposited
with the Indenture Trustee, of all sums due and to become due thereon for
principal and interest; but
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such moneys need not be segregated from other funds except to the extent
required herein or in the Sale and Servicing Agreement or required by law.
SECTION 4.03. Repayment of Moneys Held by Paying Agent. In
connection with the satisfaction and discharge of this Indenture with respect
to the Notes, all moneys then held by any Paying Agent other than the
Indenture Trustee under the provisions of this Indenture with respect to such
Notes shall, upon demand of the Issuer, be paid to the Indenture Trustee to
be held and applied according to Section 3.03 and thereupon such Paying Agent
shall be released from all further liability with respect to such moneys.
ARTICLE V
Remedies
SECTION 5.01. Events of Default. "Event of Default", wherever used
herein, means any one of the following events (whatever the reason for such
Event of Default and whether it shall be voluntary or involuntary or be
effected by operation of law or pursuant to any judgment, decree or order of
any court or any order, rule or regulation of any administrative or
governmental body):
(i) default in the payment of any interest on any Note
when the same becomes due and payable, and such default shall
continue for a period of five days;
(ii) default in the payment of the principal of or any
installment of the principal of any Note when the same becomes due
and payable; or
(iii) default in the observance or performance of any
covenant or agreement of the Issuer made in this Indenture (other
than a covenant or agreement, a default in the observance or
performance of which is elsewhere in this Section specifically
dealt with), or any representation or warranty of the Issuer made
in this Indenture or in any certificate or other writing delivered
pursuant hereto or in connection herewith proving to have been
incorrect in any material respect as of the time when the same
shall have been made, and such default shall continue or not be
cured, or the circumstance or condition in respect of which such
misrepresentation or warranty was incorrect shall not have been
eliminated or otherwise cured, for a period of 30 days after there
shall have been given, by registered or certified mail, to the
Issuer by the Indenture Trustee or to the Issuer and the Indenture
Trustee by the Holders of at least 25% of the Outstanding Amount
of the Notes, a written notice specifying such default or
incorrect representation or warranty and requiring it to be
remedied and stating that such notice is a notice of Default
hereunder; or
(iv) the filing of a decree or order for relief by a
court having jurisdiction in the premises in respect of the Issuer
or any substantial part of the Trust Estate in an involuntary case
under any applicable federal or state bankruptcy, insolvency or
other similar law now or hereafter in effect, or appointing a
receiver, liquidator, assignee,
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custodian, trustee, sequestrator or similar official of the Issuer
or for any substantial part of the Trust Estate, or ordering the
winding-up or liquidation of the Issuer's affairs, and such decree
or order shall remain unstayed and in effect for a period of 60
consecutive days; or
(v) the commencement by the Issuer 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 Issuer to the entry of an order for relief in an involuntary
case under any such law, or the consent by the Issuer to the
appointment or taking possession by a receiver, liquidator,
assignee, custodian, trustee, sequestrator or similar official of
the Issuer or for any substantial part of the Trust Estate, or the
making by the Issuer of any general assignment for the benefit of
creditors, or the failure by the Issuer generally to pay its debts
as such debts become due, or the taking of any action by the
Issuer in furtherance of any of the foregoing.
The Issuer shall deliver to the Indenture Trustee, within five days after the
occurrence thereof, written notice in the form of an Officer's Certificate of
any event which with the giving of notice and the lapse of time would become
an Event of Default under clause (iii), its status and what action the Issuer
is taking or proposes to take with respect thereto.
SECTION 5.02. Acceleration of Maturity; Rescission and Annulment.
If an Event of Default should occur and be continuing, then and in every such
case the Indenture Trustee or the Holders of Notes representing not less than
a majority of the Outstanding Amount of the Notes may declare all the Notes
to be immediately due and payable, by a notice in writing to the Issuer (and
to the Indenture Trustee if given by Noteholders), and upon any such
declaration the unpaid principal amount of such Notes, together with accrued
and unpaid interest thereon through the date of acceleration, shall become
immediately due and payable.
At any time after such declaration of acceleration of maturity has
been made and before a judgment or decree for payment of the money due has
been obtained by the Indenture Trustee as hereinafter in this Article V
provided, the Holders of Notes representing a majority of the Outstanding
Amount of the Notes, by written notice to the Issuer and the Indenture
Trustee, may rescind and annul such declaration and its consequences if:
(i) the Issuer has paid or deposited with the Indenture
Trustee a sum sufficient to pay:
(A) all payments of principal of and interest
on all Notes and all other amounts that would then be
due hereunder or upon such Notes if the Event of Default
giving rise to such acceleration had not occurred; and
(B) all sums paid or advanced by the Indenture
Trustee hereunder and the reasonable compensation,
expenses, disbursements and advances of the Indenture
Trustee and its agents and counsel; and
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(ii) all Events of Default, other than the nonpayment of
the principal of the Notes that has become due solely by such
acceleration, have been cured or waived as provided in Section
5.12.
No such rescission shall affect any subsequent default or impair any right
consequent thereto.
SECTION 5.03. Collection of Indebtedness and Suits for Enforcement
by Indenture Trustee. i) The Issuer covenants that if (i) default is made in
the payment of any interest on any Note when the same becomes due and
payable, and such default continues for a period of five days, or (ii)
default is made in the payment of the principal of or any installment of the
principal of any Note when the same becomes due and payable, the Issuer will,
upon demand of the Indenture Trustee, pay to it, for the benefit of the
Holders of the Notes, the whole amount then due and payable on such Notes for
principal and interest, with interest on the overdue principal and, to the
extent payment at such rate of interest shall be legally enforceable, on
overdue installments of interest at the rate borne by the Notes and, in
addition thereto, such further amount as shall be sufficient to cover the
costs and expenses of collection, including the reasonable compensation,
expenses, disbursements and advances of the Indenture Trustee and its agents
and counsel.
(b) In case the Issuer shall fail forthwith to pay such amounts
upon such demand, the Indenture Trustee, in its own name and as trustee of an
express trust, may institute a Proceeding for the collection of the sums so
due and unpaid, and may prosecute such Proceeding to judgment or final
decree, and may enforce the same against the Issuer or other obligor upon
such Notes and collect in the manner provided by law out of the property of
the Issuer or other obligor upon such Notes, wherever situated, the moneys
adjudged or decreed to be payable.
(c) If an Event of Default occurs and is continuing, the Indenture
Trustee may, as more particularly provided in Section 5.04, in its
discretion, proceed to protect and enforce its rights and the rights of the
Noteholders, by such appropriate Proceedings as the Indenture Trustee shall
deem most effective to protect and enforce any such rights, whether for the
specific enforcement of any covenant or agreement in this Indenture or in aid
of the exercise of any power granted herein, or to enforce any other proper
remedy or legal or equitable right vested in the Indenture Trustee by this
Indenture or by law.
(d) In case there shall be pending, relative to the Issuer or any
other obligor upon the Notes or any Person having or claiming an ownership
interest in the Trust Estate, Proceedings under Title 11 of the United States
Code or any other applicable federal or state bankruptcy, insolvency or other
similar law, or in case a receiver, assignee or trustee in bankruptcy or
reorganization, or liquidator, sequestrator or similar official shall have
been appointed for or taken possession of the Issuer or its property or such
other obligor or Person, or in case of any other comparable judicial
Proceedings relative to the Issuer or other obligor upon the Notes, or to the
creditors or property of the Issuer or such other obligor, the Indenture
Trustee, irrespective of whether the principal of any Notes shall then be due
and payable as therein expressed or by declaration or otherwise and
irrespective of whether the Indenture Trustee shall have made any demand
pursuant to the provisions of this Section, shall be entitled and empowered,
by intervention in such Proceedings or otherwise:
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(i) to file and prove a claim or claims for the whole
amount of principal and interest owing and unpaid in respect of
the Notes and to file such other papers or documents as may be
necessary or advisable in order to have the claims of the
Indenture Trustee (including any claim for reasonable compensation
to the Indenture Trustee and each predecessor Indenture Trustee,
and their respective agents, attorneys and counsel, and for
reimbursement of all expenses and liabilities incurred, and all
advances made, by the Indenture Trustee and each predecessor
Indenture Trustee, except as a result of negligence or bad faith)
and of the Noteholders allowed in such Proceedings;
(ii) unless prohibited by applicable law and
regulations, to vote on behalf of the Holders of Notes in any
election of a trustee, a standby trustee or Person performing
similar functions in any such Proceedings;
(iii) to collect and receive any moneys or other
property payable or deliverable on any such claims and to
distribute all amounts received with respect to the claims of the
Noteholders and of the Indenture Trustee on their behalf; and
(iv) to file such proofs of claim and other papers or
documents as may be necessary or advisable in order to have the
claims of the Indenture Trustee or the Holders of Notes allowed in
any Proceedings relative to the Issuer, its creditors and its
property;
and any trustee, receiver, liquidator, custodian or other similar official in
any such Proceeding is hereby authorized by each of such Noteholders to make
payments to the Indenture Trustee and, in the event that the Indenture
Trustee shall consent to the making of payments directly to such Noteholders,
to pay to the Indenture Trustee such amounts as shall be sufficient to cover
reasonable compensation to the Indenture Trustee, each predecessor Indenture
Trustee and their respective agents, attorneys and counsel, and all other
expenses and liabilities incurred, and all advances made, by the Indenture
Trustee and each predecessor Indenture Trustee except as a result of
negligence or bad faith.
(e) Nothing herein contained shall be deemed to authorize the
Indenture Trustee to authorize or consent to or vote for or accept or adopt
on behalf of any Noteholder any plan of reorganization, arrangement,
adjustment or composition affecting the Notes or the rights of any Holder
thereof or to authorize the Indenture Trustee to vote in respect of the claim
of any Noteholder in any such proceeding except, as aforesaid, to vote for
the election of a trustee in bankruptcy or similar Person.
(f) All rights of action and of asserting claims under this
Indenture, or under any of the Notes, may be enforced by the Indenture
Trustee without the possession of any of the Notes or the production thereof
in any trial or other Proceedings relative thereto, and any such action or
Proceedings instituted by the Indenture Trustee shall be brought in its own
name as trustee of an express trust, and any recovery of judgment, subject to
the payment of the expenses, disbursements and compensation of the Indenture
Trustee, each predecessor Indenture Trustee and their respective agents and
attorneys, shall be for the ratable benefit of the Holders of the Notes.
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(g) In any Proceedings brought by the Indenture Trustee (and also
any Proceedings involving the interpretation of any provision of this
Indenture to which the Indenture Trustee shall be a party), the Indenture
Trustee shall be held to represent all the Holders of the Notes, and it shall
not be necessary to make any Noteholder a party to any such Proceedings.
SECTION 5.04. Remedies; Priorities. i) If an Event of Default
shall have occurred and be continuing, the Indenture Trustee may do one or
more of the following (subject to Section 5.05):
(i) institute Proceedings in its own name and as trustee
of an express trust for the collection of all amounts then payable
on the Notes or under this Indenture with respect thereto, whether
by declaration or otherwise, enforce any judgment obtained and
collect from the Issuer and any other obligor upon such Notes
moneys adjudged due;
(ii) institute Proceedings from time to time for the
complete or partial foreclosure of this Indenture with respect to
the Trust Estate;
(iii) exercise any remedies of a secured party under the
UCC and take any other appropriate action to protect and enforce
the rights and remedies of the Indenture Trustee and the Holders
of the Notes; and
(iv) sell the Trust Estate or any portion thereof or
rights or interest therein, at one or more public or private sales
called and conducted in any manner permitted by law;
provided, however, that the Indenture Trustee may not sell or otherwise
liquidate the Trust Estate following an Event of Default, other than an Event
of Default described in Section 5.01(i) or (ii), unless (A) the Holders of
100% of the Outstanding Amount of the Notes consent thereto, (B) the proceeds
of such sale or liquidation distributable to the Noteholders are sufficient
to discharge in full all amounts then due and unpaid upon such Notes for
principal and interest or (C) the Indenture Trustee determines that the Trust
Estate will not continue to provide sufficient funds for the payment of
principal of and interest on the Notes as they would have become due if the
Notes had not been declared due and payable, and the Indenture Trustee
obtains the consent of Holders of 66% of the Outstanding Amount of the Notes.
In determining such sufficiency or insufficiency with respect to clause (B)
and (C), the Indenture Trustee may, but need not, obtain and rely upon an
opinion of an Independent investment banking or accounting firm of national
reputation as to the feasibility of such proposed action and as to the
sufficiency of the Trust Estate for such purpose.
(b) If the Indenture Trustee collects any money or property
pursuant to this Article V, it shall pay out the money or property in the
following order:
FIRST: to the Indenture Trustee for amounts due under
Section 6.07;
SECOND: to the Noteholders for amounts due and unpaid on
the Notes for interest (including any premium), ratably, without
preference or priority of any kind,
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according to the amounts due and payable on the Notes for interest
(including any premium);
THIRD: to the Noteholders in the following order of
priority:
(a) to Holders of the Class A-1 Notes for amounts due
and unpaid on the Class A-1 Notes for principal, ratably, without
preference or priority of any kind, according to the amounts due
and payable on the Class A-1 Notes for principal, until the
Outstanding Amount of the Class A-1 Notes is reduced to zero;
(b) to Holders of the Class A-2 Notes for amounts due
and unpaid on the Class A-2 Notes for principal, ratably, without
preference or priority of any kind, according to the amounts due
and payable on the Class A-2 Notes for principal, until the
Outstanding Amount of the Class A-2 Notes is reduced to zero;
(c) to Holders of the Class A-3 Notes for amounts due
and unpaid on the Class A-3 Notes for principal, ratably, without
preference or priority of any kind, according to the amounts due
and payable on the Class A-3 Notes for principal, until the
Outstanding Amount of the Class A-3 Notes is reduced to zero; and
(d) to Holders of the Class A-4 Notes for amounts due
and unpaid on the Class A-4 Notes for principal, ratably, without
preference or priority of any kind, according to the amounts due
and payable on the Class A-4 Notes for principal, until the
Outstanding Amount of the Class A-4 Notes is reduced to zero;
FIFTH: to the Issuer for distribution pursuant to the
Trust Agreement.
The Indenture Trustee may fix a record date and payment date for any payment
to Noteholders pursuant to this Section. At least 15 days before such record
date, the Issuer shall mail to each Noteholder and the Indenture Trustee a
notice that states the record date, the payment date and the amount to be
paid.
SECTION 5.05. Optional Preservation of the Receivables. If the
Notes have been declared to be due and payable under Section 5.02 following
an Event of Default and such declaration and its consequences have not been
rescinded and annulled, the Indenture Trustee may, but need not, elect to
maintain possession of the Trust Estate. It is the desire of the parties
hereto and the Noteholders that there be at all times sufficient funds for
the payment of principal of and interest on the Notes, and the Indenture
Trustee shall take such desire into account when determining whether or not
to maintain possession of the Trust Estate. In determining whether to
maintain possession of the Trust Estate, the Indenture Trustee may, but need
not, obtain and rely upon an opinion of an Independent investment banking or
accounting firm of national reputation as to the feasibility of such proposed
action and as to the sufficiency of the Trust Estate for such purpose.
SECTION 5.06. Limitation of Suits. No Holder of any Note shall
have any right to institute any Proceeding, judicial or otherwise, with
respect to this Indenture, or for the appointment of a receiver or trustee,
or for any other remedy hereunder, unless:
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(i) such Holder has previously given written notice to
the Indenture Trustee of a continuing Event of Default;
(ii) the Holders of not less than 25% of the Outstanding
Amount of the Notes have made written request to the Indenture
Trustee to institute such Proceeding in respect of such Event of
Default in its own name as Indenture Trustee hereunder;
(iii) such Holder or Holders have offered to the
Indenture Trustee reasonable indemnity against the costs, expenses
and liabilities to be incurred in complying with such request;
(iv) the Indenture Trustee for 60 days after its receipt
of such notice, request and offer of indemnity has failed to
institute such Proceedings; and
(v) no direction inconsistent with such written request
has been given to the Indenture Trustee during such 60-day period
by the Holders of a majority of the Outstanding Amount of the
Notes.
It is understood and intended that no one or more Holders of Notes shall have
any right in any manner whatever by virtue of, or by availing of, any
provision of this Indenture to affect, disturb or prejudice the rights of any
other Holders of Notes or to obtain or to seek to obtain priority or
preference over any other Holders or to enforce any right under this
Indenture, except in the manner herein provided.
In the event the Indenture Trustee shall receive conflicting or
inconsistent requests and indemnity from two or more groups of Holders of
Notes, each representing less than a majority of the Outstanding Amount of
the Notes, the Indenture Trustee in its sole discretion may determine what
action, if any, shall be taken, notwithstanding any other provisions of this
Indenture.
SECTION 5.07. Unconditional Rights of Noteholders To Receive
Principal and Interest. Notwithstanding any other provisions in this
Indenture, the Holder of any Note shall have the right, which is absolute and
unconditional, to receive payment of the principal of and interest, if any,
on such Note on or after the respective due dates thereof expressed in such
Note or in this Indenture (or, in the case of redemption, on or after the
Redemption Date) and to institute suit for the enforcement of any such
payment, and such right shall not be impaired without the consent of such
Holder.
SECTION 5.08. Restoration of Rights and Remedies. If the Indenture
Trustee or any Noteholder has instituted any Proceeding to enforce any right
or remedy under this Indenture and such Proceeding has been discontinued or
abandoned for any reason or has been determined adversely to the Indenture
Trustee or to such Noteholder, then and in every such case the Issuer, the
Indenture Trustee and the Noteholders shall, subject to any determination in
such Proceeding, be restored severally and respectively to their former
positions hereunder, and thereafter all rights and remedies of the Indenture
Trustee and the Noteholders shall continue as though no such Proceeding had
been instituted.
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SECTION 5.09. Rights and Remedies Cumulative. No right or remedy
herein conferred upon or reserved to the Indenture Trustee or to the
Noteholders is intended to be exclusive of any other right or remedy, and
every right and remedy shall, to the extent permitted by law, be cumulative
and in addition to every other right and remedy given hereunder or now or
hereafter existing at law or in equity or otherwise. The assertion or
employment of any right or remedy hereunder, or otherwise, shall not prevent
the concurrent assertion or employment of any other appropriate right or
remedy.
SECTION 5.10. Delay or Omission Not a Waiver. No delay or omission
of the Indenture Trustee or any Holder of any Note to exercise any right or
remedy accruing upon any Default or Event of Default shall impair any such
right or remedy or constitute a waiver of any such Default or Event of
Default or an acquiescence therein. Every right and remedy given by this
Article V or by law to the Indenture Trustee or to the Noteholders may be
exercised from time to time, and as often as may be deemed expedient, by the
Indenture Trustee or by the Noteholders, as the case may be.
SECTION 5.11. Control by Noteholders. The Holders of a majority of
the Outstanding Amount of the Notes shall have the right to direct the time,
method and place of conducting any Proceeding for any remedy available to the
Indenture Trustee with respect to the Notes or exercising any trust or power
conferred on the Indenture Trustee; provided that:
(i) such direction shall not be in conflict with any
rule of law or with this Indenture;
(ii) subject to the express terms of Section 5.04, any
direction to the Indenture Trustee to sell or liquidate the Trust
Estate shall be by Holders of Notes representing not less than
100% of the Outstanding Amount of the Notes;
(iii) if the conditions set forth in Section 5.05 have
been satisfied and the Indenture Trustee elects to retain the
Trust Estate pursuant to such Section, then any direction to the
Indenture Trustee by Holders of Notes representing less than 100%
of the Outstanding Amount of the Notes to sell or liquidate the
Trust Estate shall be of no force and effect; and
(iv) the Indenture Trustee may take any other action
deemed proper by the Indenture Trustee that is not inconsistent
with such direction.
Notwithstanding the rights of Noteholders set forth in this Section, subject
to Section 6.01, the Indenture Trustee need not take any action that it
determines might involve it in liability or might materially adversely affect
the rights of any Noteholders not consenting to such action.
SECTION 5.12. Waiver of Past Defaults. Prior to the declaration of
the acceleration of the maturity of the Notes as provided in Section 5.02,
the Holders of Notes of not less than a majority of the Outstanding Amount of
the Notes may waive any past Default or Event of Default and its consequences
except a Default (a) in payment of principal of or interest on any of the
Notes or (b) in respect of a covenant or provision hereof which cannot be
modified
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or amended without the consent of the Holder of each Note. In the case of any
such waiver, the Issuer, the Indenture Trustee and the Holders of the Notes
shall be restored to their former positions and rights hereunder,
respectively; but no such waiver shall extend to any subsequent or other
Default or impair any right consequent thereto.
Upon any such waiver, such Default shall cease to exist and be
deemed to have been cured and not to have occurred, and any Event of Default
arising therefrom shall be deemed to have been cured and not to have
occurred, for every purpose of this Indenture; but no such waiver shall
extend to any subsequent or other Default or Event of Default or impair any
right consequent thereto.
SECTION 5.13. Undertaking for Costs. All parties to this Indenture
agree, and each Holder of a Note by such Holder's acceptance thereof shall be
deemed to have agreed, that any court may in its discretion require, in any
suit for the enforcement of any right or remedy under this Indenture, or in
any suit against the Indenture Trustee for any action taken, suffered or
omitted by it as Indenture Trustee, the filing by any party litigant in such
suit of an undertaking to pay the costs of such suit, and that such court may
in its discretion assess reasonable costs, including reasonable attorneys'
fees, against any party litigant in such suit, having due regard to the
merits and good faith of the claims or defenses made by such party litigant;
but the provisions of this Section shall not apply to (a) any suit instituted
by the Indenture Trustee, (b) any suit instituted by any Noteholder, or group
of Noteholders, in each case holding in the aggregate more than 10% of the
Outstanding Amount of the Notes or (c) any suit instituted by any Noteholder
for the enforcement of the payment of principal of or interest on any Note on
or after the respective due dates expressed in such Note and in this
Indenture (or, in the case of redemption, on or after the Redemption Date).
SECTION 5.14. Waiver of Stay or Extension Laws. The Issuer
covenants (to the extent that it may lawfully do so) that it will not at any
time insist upon, or plead or in any manner whatsoever claim or take the
benefit or advantage of, any stay or extension law wherever enacted, now or
at any time hereafter in force, that may affect the covenants or the
performance of this Indenture; and the Issuer (to the extent that it may
lawfully do so) hereby expressly waives all benefit or advantage of any such
law, and covenants that it will not hinder, delay or impede the execution of
any power herein granted to the Indenture Trustee, but will suffer and permit
the execution of every such power as though no such law had been enacted.
SECTION 5.15. Action on Notes. The Indenture Trustee's right to
seek and recover judgment on the Notes or under this Indenture shall not be
affected by the seeking, obtaining or application of any other relief under
or with respect to this Indenture. Neither the lien of this Indenture nor any
rights or remedies of the Indenture Trustee or the Noteholders shall be
impaired by the recovery of any judgment by the Indenture Trustee against the
Issuer or by the levy of any execution under such judgment upon any portion
of the Trust Estate or upon any of the assets of the Issuer. Any money or
property collected by the Indenture Trustee shall be applied in accordance
with Section 5.04(b).
SECTION 5.16. Performance and Enforcement of Certain Obligations.
i) Promptly following a request from the Indenture Trustee to do so and at
the Administrator's expense, the
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Issuer shall take all such lawful action as the Indenture Trustee may request
to compel or secure the performance and observance by the Seller or the
Servicer, as applicable, of each of their obligations to the Issuer under or
in connection with the Sale and Servicing Agreement or by the Seller or the
Company, as applicable, of each of their obligations under or in connection
with the Purchase Agreement, and to exercise any and all rights, remedies,
powers and privileges lawfully available to the Issuer under or in connection
with the Sale and Servicing Agreement to the extent and in the manner
directed by the Indenture Trustee, including the transmission of notices of
default on the part of the Seller or the Servicer thereunder and the
institution of legal or administrative actions or proceedings to compel or
secure performance by the Seller or the Servicer of each of their obligations
under the Sale and Servicing Agreement.
(b) If an Event of Default has occurred and is continuing, the
Indenture Trustee may, and at the direction (which direction shall be in
writing or by telephone (confirmed in writing promptly thereafter)) of the
Holders of 66% of the Outstanding Amount of the Notes shall, exercise
all rights, remedies, powers, privileges and claims of the Issuer against the
Seller or the Servicer under or in connection with the Sale and Servicing
Agreement, or against the Company or the Seller under or in connection with
the Purchase Agreement, including the right or power to take any action to
compel or secure performance or observance by the Seller or the Servicer, or
the Company or the Seller, as the case may be, of each of their obligations
to the Issuer thereunder and to give any consent, request, notice, direction,
approval, extension or waiver under the Sale and Servicing Agreement or the
Purchase Agreement, as the case may be, and any right of the Issuer to take
such action shall be suspended.
ARTICLE VI
The Indenture Trustee
SECTION 6.01. Duties of Indenture Trustee. i) If an Event of
Default has occurred and is continuing, the Indenture Trustee shall exercise
the rights and powers vested in it by this Indenture and 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 such person's own affairs.
(b) Except during the continuance of an Event of Default:
(i) the Indenture Trustee undertakes to perform such
duties and only such duties as are specifically set forth in this
Indenture and no implied covenants or obligations shall be read
into this Indenture against the Indenture Trustee; and
(ii) in the absence of bad faith on its part, the
Indenture Trustee may conclusively rely, as to the truth of the
statements and the correctness of the opinions expressed therein,
upon certificates or opinions furnished to the Indenture Trustee
and conforming to the requirements of this Indenture; however, the
Indenture Trustee shall examine the certificates and opinions to
determine whether or not they conform to the requirements of this
Indenture.
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(c) The Indenture Trustee may not be relieved from liability for
its own negligent action, its own negligent failure to act or its own willful
misconduct, except that:
(i) this paragraph does not limit the effect of
paragraph (b) of this Section;
(ii) the Indenture Trustee shall not be liable for any
error of judgment made in good faith by a Responsible Officer
unless it is proved that the Indenture Trustee was negligent in
ascertaining the pertinent facts; and
(iii) the Indenture Trustee shall not be liable with
respect to any action it takes or omits to take in good faith in
accordance with a direction received by it pursuant to Section
5.11.
(d) Every provision of this Indenture that in any way relates to
the Indenture Trustee is subject to paragraphs (a) , (b), (c) and (g) of this
Section.
(e) The Indenture Trustee shall not be liable for interest on any
money received by it except as the Indenture Trustee may agree in writing
with the Issuer.
(f) Money held in trust by the Indenture Trustee need not be
segregated from other funds except to the extent required by law or the terms
of this Indenture or the Sale and Servicing Agreement.
(g) No provision of this Indenture shall require the Indenture
Trustee 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 it shall have reasonable grounds
to believe that repayment of such funds or adequate indemnity against such
risk or liability is not reasonably assured to it.
(h) Every provision of this Indenture relating to the conduct or
affecting the liability of or affording protection to the Indenture Trustee
shall be subject to the provisions of this Section and to the provisions of
the TIA.
SECTION 6.02. Rights of Indenture Trustee. i) The Indenture
Trustee may rely on any document believed by it to be genuine and to have
been signed or presented by the proper person. The Indenture Trustee need not
investigate any fact or matter stated in the document.
(b) Before the Indenture Trustee acts or refrains from acting, it
may require an Officer's Certificate or an Opinion of Counsel. The Indenture
Trustee shall not be liable for any action it takes or omits to take in good
faith in reliance on an Officer's Certificate or Opinion of Counsel.
(c) The Indenture Trustee may execute any of the trusts or powers
hereunder or perform any duties hereunder either directly or by or through
agents or attorneys or a custodian or nominee, and the Indenture Trustee
shall not be responsible for any misconduct or negligence on the part of, or
for the supervision of, any such agent, attorney, custodian or nominee
appointed with due care by it hereunder.
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(d) The Indenture Trustee shall not be liable for any action it
takes or omits to take in good faith which it believes to be authorized or
within its rights or powers; provided, that the Indenture Trustee's conduct
does not constitute willful misconduct, negligence or bad faith.
(e) The Indenture Trustee may consult with counsel, and the advice
or opinion of counsel with respect to legal matters relating to this
Indenture and the Notes shall be full and complete authorization and
protection from liability in respect to any action taken, omitted or suffered
by it hereunder in good faith and in accordance with the advice or opinion of
such counsel.
SECTION 6.03. Individual Rights of Indenture Trustee. The
Indenture Trustee in its individual or any other capacity may become the
owner or pledgee of Notes and may otherwise deal with the Issuer or its
Affiliates with the same rights it would have if it were not Indenture
Trustee. Any Paying Agent, Note Registrar, co-registrar or co-paying agent
may do the same with like rights. However, the Indenture Trustee must comply
with Sections 6.11 and 6.12.
SECTION 6.04. Indenture Trustee's Disclaimer. The Indenture
Trustee shall not be responsible for and makes no representation as to the
validity or adequacy of this Indenture or the Notes, it shall not be
accountable for the Issuer's use of the proceeds from the Notes, and it shall
not be responsible for any statement of the Issuer in the Indenture or in any
document issued in connection with the sale of the Notes or in the Notes
other than the Indenture Trustee's certificate of authentication.
SECTION 6.05. Notice of Defaults. If a Default occurs and is
continuing and if it is known to a Responsible Officer of the Indenture
Trustee, the Indenture Trustee shall mail to each Noteholder notice of the
Default within 90 days after it occurs. Except in the case of a Default in
payment of principal of or interest on any Note (including payments pursuant
to the mandatory redemption provisions of such Note), the Indenture Trustee
may withhold the notice if and so long as a committee of its Responsible
Officers in good faith determines that withholding the notice is in the
interests of Noteholders.
SECTION 6.06. Reports by Indenture Trustee to Holders. The
Indenture Trustee shall deliver to each Noteholder such information as may be
required to enable such holder to prepare its federal and state income tax
returns. On each Distribution Date, the Indenture Trustee shall send to each
Certificateholder the statement or statements provided to the Indenture
Trustee by the Servicer pursuant to Section 5.09 of the Sale and Servicing
Agreement with respect to such Distribution Date.
SECTION 6.07. Compensation and Indemnity. The Issuer shall, or
shall cause the Administrator to, pay to the Indenture Trustee from time to
time reasonable compensation for its services. The Indenture Trustee's
compensation shall not be limited by any law on compensation of a trustee of
an express trust. The Issuer shall, or shall cause the Administrator to,
reimburse the Indenture Trustee for all reasonable out-of-pocket expenses
incurred or made by it, including costs of collection, in addition to the
compensation for its services. Such expenses shall include the reasonable
compensation and expenses, disbursements and advances of the Indenture
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Trustee's agents, counsel, accountants and experts. The Issuer shall, or
shall cause the Administrator to, indemnify the Indenture Trustee against any
and all loss, liability or expense (including attorneys' fees) incurred by it
in connection with the administration of this trust and the performance of
its duties hereunder. The Indenture Trustee shall notify the Issuer and the
Administrator promptly of any claim for which it may seek indemnity. Failure
by the Indenture Trustee to so notify the Issuer and the Administrator shall
not relieve the Issuer or the Administrator of its obligations hereunder. The
Issuer shall, or shall cause the Administrator to, defend any such claim, and
the Indenture Trustee may have separate counsel and the Issuer shall, or
shall cause the Administrator to, pay the fees and expenses of such counsel.
Neither the Issuer nor the Administrator need reimburse any expense or
indemnify against any loss, liability or expense incurred by the Indenture
Trustee through the Indenture Trustee's own willful misconduct, negligence or
bad faith.
The Issuer's payment obligations to the Indenture Trustee pursuant
to this Section shall survive the discharge of this Indenture. When the
Indenture Trustee incurs expenses after the occurrence of a Default specified
in Section 5.01(iv) or (v) with respect to the Issuer, the expenses are
intended to constitute expenses of administration under Title 11 of the
United States Code or any other applicable federal or state bankruptcy,
insolvency or similar law.
SECTION 6.08. Replacement of Indenture Trustee. No resignation or
removal of the Indenture Trustee and no appointment of a successor Indenture
Trustee shall become effective until the acceptance of appointment by the
successor Indenture Trustee pursuant to this Section 6.08. The Indenture
Trustee may resign at any time by so notifying the Issuer. The Holders of a
majority in Outstanding Amount of the Notes may remove the Indenture Trustee
by so notifying the Indenture Trustee and may appoint a successor Indenture
Trustee. The Issuer shall remove the Indenture Trustee if:
(i) the Indenture Trustee fails to comply with Section
6.11;
(ii) the Indenture Trustee is adjudged a bankrupt or
insolvent;
(iii) a receiver or other public officer takes charge of
the Indenture Trustee or its property; or
(iv) the Indenture Trustee otherwise becomes incapable
of acting.
If the Indenture Trustee resigns or is removed or if a vacancy exists in the
office of Indenture Trustee for any reason (the Indenture Trustee in such
event being referred to herein as the retiring Indenture Trustee), the Issuer
shall promptly appoint a successor Indenture Trustee.
A successor Indenture Trustee shall deliver a written acceptance
of its appointment to the retiring Indenture Trustee and to the Issuer.
Thereupon the resignation or removal of the retiring Indenture Trustee shall
become effective, and the successor Indenture Trustee shall have all the
rights, powers and duties of the Indenture Trustee under this Indenture. The
successor Indenture Trustee shall mail a notice of its succession to
Noteholders. The retiring Indenture Trustee shall promptly transfer all
property held by it as Indenture Trustee to the successor Indenture Trustee.
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If a successor Indenture Trustee does not take office within 60
days after the retiring Indenture Trustee resigns or is removed, the retiring
Indenture Trustee, the Issuer or the Holders of a majority in Outstanding
Amount of the Notes may petition any court of competent jurisdiction for the
appointment of a successor Indenture Trustee.
If the Indenture Trustee fails to comply with Section 6.11, any
Noteholder may petition any court of competent jurisdiction for the removal
of the Indenture Trustee and the appointment of a successor Indenture
Trustee.
Notwithstanding the replacement of the Indenture Trustee pursuant
to this Section, the Issuer's and the Administrator's obligations under
Section 6.07 shall continue for the benefit of the retiring Indenture
Trustee.
SECTION 6.09. Successor Indenture Trustee by Merger. If the
Indenture Trustee consolidates with, merges or converts into, or transfers
all or substantially all its corporate trust business or assets to, another
corporation or banking association, the resulting, surviving or transferee
corporation without any further act shall be the successor Indenture Trustee;
provided, that such corporation or banking association shall be otherwise
qualified and eligible under Section 6.11. The Indenture Trustee shall
provide the Rating Agencies prior written notice of any such transaction.
In case at the time such successor or successors by merger,
conversion or consolidation to the Indenture Trustee shall succeed to the
trusts created by this Indenture any of the Notes shall have been
authenticated but not delivered, any such successor to the Indenture Trustee
may adopt the certificate of authentication of any predecessor trustee and
deliver such Notes so authenticated; and in case at that time any of the
Notes shall not have been authenticated, any successor to the Indenture
Trustee may authenticate such Notes either in the name of any predecessor
hereunder or in the name of the successor to the Indenture Trustee; and in
all such cases such certificates shall have the full force which it is
anywhere in the Notes or in this Indenture provided that the certificate of
the Indenture Trustee shall have.
SECTION 6.10. Appointment of Co-Indenture Trustee or Separate
Indenture Trustee. i) Notwithstanding any other provisions of this Indenture,
at any time, for the purpose of meeting any legal requirement of any
jurisdiction in which any part of the Trust Estate may at the time be
located, the Indenture Trustee shall have the power and may execute and
deliver all instruments to appoint one or more Persons to act as a co-trustee
or co-trustees, or separate trustee or separate trustees, of all or any part
of the Trust, and to vest in such Person or Persons, in such capacity and for
the benefit of the Noteholders, such title to the Trust Estate, or any part
hereof, and, subject to the other provisions of this Section, such powers,
duties, obligations, rights and trusts as the Indenture Trustee may consider
necessary or desirable. No co-trustee or separate trustee hereunder shall be
required to meet the terms of eligibility as a successor trustee under
Section 6.11 and no notice to Noteholders of the appointment of any
co-trustee or separate trustee shall be required under Section 6.08 hereof.
(b) Every separate trustee and co-trustee shall, to the extent
permitted by law, be appointed and act subject to the following provisions
and conditions:
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(i) all rights, powers, duties and obligations conferred
or imposed upon the Indenture Trustee shall be conferred or
imposed upon and exercised or performed by the Indenture 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 Indenture 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 the Indenture 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 Estate 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
Indenture Trustee;
(ii) no trustee hereunder shall be personally liable by
reason of any act or omission of any other trustee hereunder; and
(iii) the Indenture Trustee may at any time accept the
resignation of or remove any separate trustee or co-trustee.
(c) Any notice, request or other writing given to the Indenture
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 VI. 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 Indenture Trustee or separately, as may be provided therein,
subject to all the provisions of this Indenture, specifically including every
provision of this Indenture relating to the conduct of, affecting the
liability of, or affording protection to, the Indenture Trustee. Every such
instrument shall be filed with the Indenture Trustee.
(d) Any separate trustee or co-trustee may at any time constitute
the Indenture 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 Indenture Trustee, to the extent permitted by
law, without the appointment of a new or successor trustee.
SECTION 6.11. Eligibility; Disqualification. The Indenture Trustee
shall at all times satisfy the requirements of TIA ss. 310(a). The Indenture
Trustee shall have a combined capital and surplus of at least $50,000,000 as
set forth in its most recent published annual report of condition, and the
time deposits of the Indenture Trustee shall be rated at least A-1 by
Standard & Poor's and P-1 by Moody's. The Indenture Trustee shall comply with
TIA ss. 310(b), including the optional provision permitted by the second
sentence of TIA ss. 310(b)(9); provided, however, that there shall be
excluded from the operation of TIA ss. 310(b)(1) any indenture or indentures
under which other securities of the Issuer are outstanding if the
requirements for such exclusion set forth in TIA ss. 310(b)(1) are met.
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SECTION 6.12. Preferential Collection of Claims Against Issuer.
The Indenture Trustee shall comply with TIA ss. 311(a), excluding any
creditor relationship listed in TIA ss. 311(b). An Indenture Trustee who has
resigned or been removed shall be subject to TIA ss. 311(a) to the extent
indicated.
SECTION 6.13. Pennsylvania Motor Vehicle Sales Finance Act
Licenses. The Indenture Trustee shall use its best efforts to maintain the
effectiveness of all licenses required under the Pennsylvania Motor Vehicle
Sales Finance Act in connection with this Indenture and the transactions
contemplated hereby until the lien and security interest of this Indenture
shall no longer be in effect in accordance with the terms hereof.
ARTICLE VII
Noteholders' Lists and Reports
SECTION 7.01. Issuer To Furnish Indenture Trustee Names and
Addresses of Noteholders. The Issuer will furnish or cause to be furnished to
the Indenture Trustee (a) not more than five days after the earlier of (i)
each Record Date and (ii) three months after the last Record Date, a list, in
such form as the Indenture Trustee may reasonably require, of the names and
addresses of the Holders of Notes as of such Record Date, and (b) at such
other times as the Indenture Trustee may request in writing, within 30 days
after receipt by the Issuer of any such request, a list of similar form and
content as of a date not more than 10 days prior to the time such list is
furnished; provided, however, that so long as the Indenture Trustee is the
Note Registrar, no such list shall be required to be furnished.
SECTION 7.02. Preservation of Information; Communications to
Noteholders. i) The Indenture Trustee shall
preserve, in as current a form as is reasonably practicable, the names and
addresses of the Holders of Notes contained in the most recent list furnished
to the Indenture Trustee as provided in Section 7.01 and the names and
addresses of Holders of Notes received by the Indenture Trustee in its
capacity as Note Registrar. The Indenture Trustee may destroy any list
furnished to it as provided in such Section 7.01 upon receipt of a new list
so furnished.
(b) Noteholders may communicate pursuant to TIAss. 312(b) with
other Noteholders with respect to their rights under this Indenture or under
the Notes.
(c) The Issuer, the Indenture Trustee and the Note Registrar shall
have the protection of TIA ss. 312(c).
SECTION 7.03. Reports by Issuer. i) The Issuer shall:
(i) file with the Indenture Trustee, within 15 days
after the Issuer is required to file the same with the Commission,
copies of the annual reports and of the information, documents and
other reports (or copies of such portions of any of the foregoing
as the Commission may from time to time by rules and regulations
prescribe) that the Issuer
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may be required to file with the Commission pursuant to Section 13
or 15(d) of the Exchange Act;
(ii) file with the Indenture Trustee and the Commission
in accordance with rules and regulations prescribed from time to
time by the Commission such additional information, documents and
reports with respect to compliance by the Issuer with the
conditions and covenants of this Indenture as may be required from
time to time by such rules and regulations; and
(iii) supply to the Indenture Trustee (and the Indenture
Trustee shall transmit by mail to all Noteholders described in TIA
ss. 313(c)) such summaries of any information, documents and
reports required to be filed by the Issuer pursuant to clauses (i)
and (ii) of this Section 7.03(a) and by rules and regulations
prescribed from time to time by the Commission.
(b) Unless the Issuer otherwise determines, the fiscal year of the
Issuer shall end on December 31 of each year.
SECTION 7.04. Reports by Indenture Trustee. If required by TIA ss.
313(a), within 60 days after each February 1 beginning with February 1, 1999,
the Indenture Trustee shall mail to each Noteholder as required by TIA ss.
313(c) a brief report dated as of such date that complies with TIA ss.
313(a). The Indenture Trustee also shall comply with TIA ss. 313(b).
A copy of each report at the time of its mailing to Noteholders
shall be filed by the Indenture Trustee with the Commission and each stock
exchange, if any, on which the Notes are listed. The Issuer shall notify the
Indenture Trustee if and when the Notes are listed on any stock exchange.
ARTICLE VIII
Accounts, Disbursements and Releases
SECTION 8.01. Collection of Money. Except as otherwise expressly
provided herein, the Indenture Trustee may demand payment or delivery of, and
shall receive and collect, directly and without intervention or assistance of
any fiscal agent or other intermediary, all money and other property payable
to or receivable by the Indenture Trustee pursuant to this Indenture. The
Indenture Trustee shall apply all such money received by it as provided in
this Indenture. Except as otherwise expressly provided in this Indenture, if
any default occurs in the making of any payment or performance under any
agreement or instrument that is part of the Trust Estate, the Indenture
Trustee may take such action as may be appropriate to enforce such payment or
performance, including the institution and prosecution of appropriate
Proceedings. Any such action shall be without prejudice to any right to claim
a Default or Event of Default under this Indenture and any right to proceed
thereafter as provided in Article V.
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SECTION 8.02. Collection Account. i) On or prior to the Closing
Date, the Issuer shall cause the Servicer to establish and maintain, in the
name of the Indenture Trustee, for the benefit of the Noteholders and the
Certificateholders, the Collection Account as provided in Section 5.01 of the
Sale and Servicing Agreement.
(b) On or before each Distribution Date, the Total Distribution
Amount (net of the Servicing Fee for such Distribution Date and any
previously unpaid Servicing Fees, the Cash Release Amount and any other
distributable amounts that are to be allocated for distribution or release to
the Seller or the Company) with respect to the preceding Collection Period
will be deposited in the Collection Account as provided in Section 5.02 of
the Sale and Servicing Agreement. The Indenture Trustee shall allocate
amounts in the Collection Account for distribution to Noteholders in
accordance with Sections 5.06 and 5.07 of the Sale and Servicing Agreement.
(c) On each Distribution Date and Redemption Date, the Indenture
Trustee shall distribute all amounts allocated in the Collection Account for
distribution to the Noteholders in respect of the Notes to the extent of
amounts due and unpaid on the Notes for principal and interest (including any
premium) in the following amounts and in the following order of priority
(except as otherwise provided in Section 5.04(b)):
(i) accrued and unpaid interest on the Notes; provided,
that if there are not sufficient funds allocated in the Collection
Account for distribution to the Noteholders to pay the entire
amount of accrued and unpaid interest then due on the Notes, the
amount allocated in the Collection Account for distribution to the
Noteholders shall be applied to the payment of such interest on
the Notes pro rata on the basis of the total such interest due on
the Notes; and
(ii) the Noteholders' Principal Distributable Amount (or
on each Distribution Date in the Release Period, the Release
Period Noteholders' Principal Distributable Amount) in the
following order of priority:
(1) to the Holders of the Class A-1 Notes on account of
principal until the Outstanding Amount of the Class A-1 Notes is
reduced to zero;
(2) to the Holders of the Class A-2 Notes on account of
principal until the Outstanding Amount of the Class A-2 Notes is
reduced to zero;
(3) to the Holders of the Class A-3 Notes on account of
principal until the Outstanding Amount of the Class A-3 Notes is
reduced to zero; and
(4) to the Holders of the Class A-4 Notes on account of
principal until the Outstanding Amount of the Class A-4 Notes is
reduced to zero.
If the amounts called for pursuant to Section 5.06(a)(ii)(D), (E) and (F) of
the Sale and Servicing Agreement have not been netted out of the Total
Distribution Amount as permitted under that Section under certain
circumstances, then after making the distributions to the Noteholders and
subject to Section 8.04, the Indenture Trustee shall make the distributions,
if any, to the
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Certificateholders called for pursuant to Sections 5.06(a)(ii)(D), (E) and
(F) of the Sale and Servicing Agreement; provided that if the Owner Trustee
has removed the Indenture Trustee as the paying agent for the Issuer, the
Indenture Trustee shall distribute such amounts to the paying agent for the
Issuer as instructed by the Owner Trustee.
SECTION 8.03. General Provisions Regarding Accounts. i) So long as
no Default or Event of Default shall have occurred and be continuing, all or
a portion of the funds in the Collection Account shall be invested in
Eligible Investments and reinvested by the Indenture Trustee (or the
investment manager referred to in clause (2) of Section 5.01(b) of the Sale
and Servicing Agreement) upon Issuer Order, subject to the provisions of
Section 5.01(b) of the Sale and Servicing Agreement. All income or other gain
from investments of moneys deposited in the Collection Account shall remain
on deposit in the Collection Account, and any loss resulting from such
investments shall be charged to such account. The Issuer will not direct the
Indenture Trustee to make any investment of any funds or to sell any
investment held in the Collection Account unless the security interest
Granted and perfected in such Collection 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 Indenture Trustee to make any such investment or sale, if
requested by the Indenture Trustee, the Issuer shall deliver to the Indenture
Trustee an Opinion of Counsel, acceptable to the Indenture Trustee, to such
effect.
(b) Subject to Section 6.01(c), the Indenture Trustee shall not in
any way be held liable by reason of any insufficiency in the Collection
Account resulting from any loss on any Eligible Investment included therein
except for losses attributable to the Indenture Trustee's failure to make
payments on such Eligible Investments issued by the Indenture Trustee, in its
commercial capacity as principal obligor and not as trustee, in accordance
with their terms.
(c) If (i) the Issuer (or the Servicer or any investment manager
pursuant to Section 5.01(b) of the Sale and Servicing Agreement) shall have
failed to give investment directions for any funds on deposit in the
Collection Account to the Indenture Trustee by 11:00 a.m. Eastern Time (or
such other time as may be agreed by the Issuer and Indenture Trustee) on any
Business Day or (ii) a Default or Event of Default shall have occurred and be
continuing with respect to the Notes but the Notes shall not have been
declared due and payable pursuant to Section 5.02 or (iii) if such Notes
shall have been declared due and payable following an Event of Default but
amounts collected or receivable from the Trust Estate are being applied in
accordance with Section 5.05 as if there had not been such a declaration,
then the Indenture Trustee shall, to the fullest extent practicable, invest
and reinvest funds in the Collection Account in one or more Eligible
Investments.
SECTION 8.04. Release of Trust Estate. i) Subject to the payment
of its fees and expenses pursuant to Section 6.07, the Indenture Trustee may,
and when required by the provisions of this Indenture shall, execute
instruments to release property from the lien of this Indenture, or convey
the Indenture Trustee's interest in the same, in a manner and under
circumstances that are not inconsistent with the provisions of this
Indenture. No party relying upon an instrument executed by the Indenture
Trustee as provided in this Article VIII shall be
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bound to ascertain the Indenture Trustee's authority, inquire into the
satisfaction of any conditions precedent or see to the application of any
moneys.
(b) The Indenture Trustee shall, at such time as there are no
Notes Outstanding and all sums due the Indenture Trustee pursuant to Section
6.07 have been paid, release any remaining portion of the Trust Estate that
secured the Notes from the lien of this Indenture and release to the Issuer
or any other Person entitled thereto any funds then on deposit in the
Collection Account. The Indenture Trustee shall release property from the
lien of this Indenture pursuant to this Section 8.04(b) only upon receipt of
an Issuer Request accompanied by an Officer's Certificate, an Opinion of
Counsel and (if required by the TIA) Independent Certificates in accordance
with TIA ss.ss. 314(c) and 314(d)(1) meeting the applicable requirements of
Section 11.01.
(c) Each Noteholder, by the acceptance of a Note, acknowledges
that promptly following the Closing Date and each Transfer Date the Indenture
Trustee shall release the lien of this Indenture on each Fixed Value Payment
and Fixed Value Finance Charges (subject to Section 5.03(b) of the Sale and
Servicing Agreement) assigned by the Issuer to the Seller, and consents to
such release.
(d) Upon the written notification from the Servicer pursuant to
Section 5.06(a)(ii)(D) of the Sale and Servicing Agreement, the Issuer shall
deliver to the Indenture Trustee an Issuer Request accompanied by an
Officer's Certificate, an Opinion of Counsel and (if required by the TIA)
Independent Certificates in accordance with TIA ss.ss. 314(c) and 314(d)(1)
meeting the applicable requirements of Section 11.01, and upon its receipt of
such items the Indenture Trustee (or the Servicer to the extent permitted by
Section 5.06 of the Sale and Servicing Agreement) shall distribute the Cash
Release Amount (to the extent of funds available pursuant to Section
5.06(a)(ii)(D) of the Sale and Servicing Agreement) to the Company.
SECTION 8.05. Opinion of Counsel. The Indenture Trustee shall
receive at least seven days notice when requested by the Issuer to take any
action pursuant to Section 8.04(a), accompanied by copies of any instruments
involved, and the Indenture Trustee shall also require, except in connection
with any action contemplated by Section 8.04(c), as a condition to such
action, an Opinion of Counsel, in form and substance satisfactory to the
Indenture Trustee, stating the legal effect of any such action, outlining the
steps required to complete the same, and concluding that all conditions
precedent to the taking of such action have been complied with and such
action will not materially and adversely impair the security for the Notes or
the rights of the Noteholders in contravention of the provisions of this
Indenture; provided, however, that such Opinion of Counsel shall not be
required to express an opinion as to the fair value of the Trust Estate.
Counsel rendering any such opinion may rely, without independent
investigation, on the accuracy and validity of any certificate or other
instrument delivered to the Indenture Trustee in connection with any such
action.
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ARTICLE IX
Supplemental Indentures
SECTION 9.01. Supplemental Indentures Without Consent of
Noteholders. i) Without the consent of the Holders of any Notes but with
prior notice to the Rating Agencies, the Issuer and the Indenture Trustee,
when authorized by an Issuer Order, at any time and from time to time, may
enter into one or more indentures supplemental hereto (which shall conform to
the provisions of the Trust Indenture Act as in force at the date of the
execution thereof), in form satisfactory to the Indenture Trustee, for any of
the following purposes:
(i) to correct or amplify the description of any
property at any time subject to the lien of this Indenture, or
better to assure, convey and confirm unto the Indenture Trustee
any property subject or required to be subjected to the lien of
this Indenture, or to subject to the lien of this Indenture
additional property;
(ii) to evidence the succession, in compliance with the
applicable provisions hereof, of another person to the Issuer, and
the assumption by any such successor of the covenants of the
Issuer herein and in the Notes contained;
(iii) to add to the covenants of the Issuer, for the
benefit of the Holders of the Notes, or to surrender any right or
power herein conferred upon the Issuer;
(iv) to convey, transfer, assign, mortgage or pledge any
property to or with the Indenture Trustee;
(v) to cure any ambiguity, to correct or supplement any
provision herein or in any supplemental indenture that may be
inconsistent with any other provision herein or in any
supplemental indenture or to make any other provisions with
respect to matters or questions arising under this Indenture or in
any supplemental indenture; provided, that such action shall not
adversely affect the interests of the Holders of the Notes;
(vi) to evidence and provide for the acceptance of the
appointment hereunder by a successor trustee with respect to the
Notes and to add to or change any of the provisions of this
Indenture as shall be necessary to facilitate the administration
of the trusts hereunder by more than one trustee, pursuant to the
requirements of Article VI; or
(vii) to modify, eliminate or add to the provisions of
this Indenture to such extent as shall be necessary to effect the
qualification of this Indenture under the TIA or under any similar
federal statute hereafter enacted and to add to this Indenture
such other provisions as may be expressly required by the TIA.
The Indenture Trustee is hereby authorized to join in the execution of any
such supplemental indenture and to make any further appropriate agreements
and stipulations that may be therein contained.
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(b) The Issuer and the Indenture Trustee, when authorized by an
Issuer Order, may, also without the consent of any of the Holders of the
Notes but with prior notice to the Rating Agencies, enter into an indenture
or indentures supplemental hereto for the purpose of adding any provisions
to, or changing in any manner or eliminating any of the provisions of, this
Indenture or of modifying in any manner the rights of the Holders of the
Notes under this Indenture; provided, however, that such action shall not, as
evidenced by an Opinion of Counsel, adversely affect in any material respect
the interests of any Noteholder.
SECTION 9.02. Supplemental Indentures with Consent of Noteholders.
The Issuer and the Indenture Trustee, when authorized by an Issuer Order,
also may, with prior notice to the Rating Agencies and with the consent of
the Holders of not less than a majority of the Outstanding Amount of the
Notes, by Act of such Holders delivered to the Issuer and the Indenture
Trustee, enter into an indenture or indentures supplemental hereto for the
purpose of adding any provisions to, or changing in any manner or eliminating
any of the provisions of, this Indenture or of modifying in any manner the
rights of the Holders of the Notes under this Indenture; provided, however,
that no such supplemental indenture shall, without the consent of the Holder
of each Outstanding Note affected thereby:
(i) change the date of payment of any installment of
principal of or interest on any Note, or reduce the principal
amount thereof, the Interest Rate thereon or the Redemption Price
with respect thereto, change the provisions of this Indenture
relating to the application of collections on, or the proceeds of
the sale of, the Trust Estate to payment of principal of or
interest on the Notes, or change any place of payment where, or
the coin or currency in which, any Note or the interest thereon is
payable, or impair the right to institute suit for the enforcement
of the provisions of this Indenture requiring the application of
funds available therefor, as provided in Article V, to the payment
of any such amount due on the Notes on or after the respective due
dates thereof (or, in the case of redemption, on or after the
Redemption Date);
(ii) reduce the percentage of the Outstanding Amount of
the Notes, the consent of the Holders of which is required for any
such supplemental indenture, or the consent of the Holders of
which is required for any waiver of compliance with certain
provisions of this Indenture or certain defaults hereunder and
their consequences provided for in this Indenture;
(iii) modify or alter the provisions of the proviso to
the definition of the term "Outstanding";
(iv) reduce the percentage of the Outstanding Amount of
the Notes required to direct the Indenture Trustee to direct the
Issuer to sell or liquidate the Trust Estate pursuant to Section
5.04;
(v) modify any provision of this Section except to
increase any percentage specified herein or to provide that
certain additional provisions of this Indenture or the Basic
Documents cannot be modified or waived without the consent of the
Holder of each Outstanding Note affected thereby;
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(vi) modify any of the provisions of this Indenture in
such manner as to affect the calculation of the amount of any
payment of interest or principal due on any Note on any
Distribution Date (including the calculation of any of the
individual components of such calculation) or to affect the rights
of the Holders of Notes to the benefit of any provisions for the
mandatory redemption of the Notes contained herein; or
(vii) permit the creation of any lien ranking prior to
or on a parity with the lien of this Indenture with respect to any
part of the Trust Estate or, except as otherwise permitted or
contemplated herein, terminate the lien of this Indenture on any
property at any time subject hereto or deprive the Holder of any
Note of the security provided by the lien of this Indenture.
The Indenture Trustee may in its discretion determine whether or not any
Notes would be affected by any supplemental indenture and any such
determination shall be conclusive upon the Holders of all Notes, whether
theretofore or thereafter authenticated and delivered hereunder. The
Indenture Trustee shall not be liable for any such determination made in good
faith.
It shall not be necessary for any Act of Noteholders under this
Section to approve the particular form of any proposed supplemental
indenture, but it shall be sufficient if such Act shall approve the substance
thereof.
Promptly after the execution by the Issuer and the Indenture
Trustee of any supplemental indenture pursuant to this Section, the Indenture
Trustee shall mail to the Holders of the Notes to which such amendment or
supplemental indenture relates a notice setting forth in general terms the
substance of such supplemental indenture. Any failure of the Indenture
Trustee to mail such notice, or any defect therein, shall not, however, in
any way impair or affect the validity of any such supplemental indenture.
SECTION 9.03. Execution of Supplemental Indentures. In executing,
or permitting the additional trusts created by, any supplemental indenture
permitted by this Article IX or the modification thereby of the trusts
created by this Indenture, the Indenture Trustee shall be entitled to
receive, and subject to Sections 6.01 and 6.02, shall be fully protected in
relying upon, an Opinion of Counsel stating that the execution of such
supplemental indenture is authorized or permitted by this Indenture. The
Indenture Trustee may, but shall not be obligated to, enter into any such
supplemental indenture that affects the Indenture Trustee's own rights,
duties, liabilities or immunities under this Indenture or otherwise.
SECTION 9.04. Effect of Supplemental Indenture. Upon the execution
of any supplemental indenture pursuant to the provisions hereof, this
Indenture shall be and shall be deemed to be modified and amended in
accordance therewith with respect to the Notes affected thereby, and the
respective rights, limitations of rights, obligations, duties, liabilities
and immunities under this Indenture of the Indenture Trustee, the Issuer and
the Holders of the Notes shall thereafter be determined, exercised and
enforced hereunder subject in all respects to such modifications and
amendments, and all the terms and conditions of any such supplemental
indenture shall be and be deemed to be part of the terms and conditions of
this Indenture for any and all purposes.
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SECTION 9.05. Conformity with Trust Indenture Act. Every amendment
of this Indenture and every supplemental indenture executed pursuant to this
Article IX shall conform to the requirements of the Trust Indenture Act as
then in effect so long as this Indenture shall then be qualified under the
Trust Indenture Act.
SECTION 9.06. Reference in Notes to Supplemental Indentures. Notes
authenticated and delivered after the execution of any supplemental indenture
pursuant to this Article IX may, and if required by the Indenture Trustee
shall, bear a notation in form approved by the Indenture Trustee as to any
matter provided for in such supplemental indenture. If the Issuer or the
Indenture Trustee shall so determine, new Notes so modified as to conform, in
the opinion of the Indenture Trustee and the Issuer, to any such supplemental
indenture may be prepared and executed by the Issuer and authenticated and
delivered by the Indenture Trustee in exchange for Outstanding Notes.
ARTICLE X
Redemption of Notes
SECTION 10.01. Redemption. The outstanding Class A-4 Notes are
subject to redemption in whole, but not in part, at the direction of the
Servicer pursuant to Section 9.01(a) of the Sale and Servicing Agreement, on
any Distribution Date on which the Servicer exercises its option to purchase
the Trust Estate pursuant to said Section 9.01(a), for a purchase price equal
to the Redemption Price; provided that the Issuer has available funds
sufficient to pay the Redemption Price. The Servicer or the Issuer shall
furnish the Rating Agencies notice of such redemption. If the outstanding
Class A-4 Notes are to be redeemed pursuant to this Section, the Servicer or
the Issuer shall furnish notice of such election to the Indenture Trustee not
later than 20 days prior to the Redemption Date and the Issuer shall deposit
by 10:00 A.M. New York City time on the Redemption Date with the Indenture
Trustee in the Collection Account the Redemption Price of the Class A-4 Notes
to be redeemed, whereupon all such Class A-4 Notes shall be due and payable
on the Redemption Date upon the furnishing of a notice complying with Section
10.02 to each Holder of the Notes.
SECTION 10.02. Form of Redemption Notice. Notice of redemption
under Section 10.01 shall be given by the Indenture Trustee by first-class
mail, postage prepaid, or by facsimile mailed or transmitted not later than
10 days prior to the applicable Redemption Date to each Holder of Notes, as
of the close of business on the Record Date preceding the applicable
Redemption Date, at such Holder's address or facsimile number appearing in
the Note Register.
All notices of redemption shall state:
(i) the Redemption Date;
(ii) the Redemption Price; and
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(iii) the place where such Notes are to be surrendered
for payment of the Redemption Price (which shall be the office or
agency of the Issuer to be maintained as provided in Section
3.02).
Notice of redemption of the Notes shall be given by the Indenture Trustee in
the name and at the expense of the Issuer. Failure to give notice of
redemption, or any defect therein, to any Holder of any Note shall not impair
or affect the validity of the redemption of any other Note.
SECTION 10.03. Notes Payable on Redemption Date. The Notes or
portions thereof to be redeemed shall, following notice of redemption as
required by Section 10.02, on the Redemption Date become due and payable at
the Redemption Price and (unless the Issuer shall default in the payment of
the Redemption Price) no interest shall accrue on the Redemption Price for
any period after the date to which accrued interest is calculated for
purposes of calculating the Redemption Price.
ARTICLE XI
Miscellaneous
SECTION 11.01. Compliance Certificates and Opinions, etc. i) Upon
any application or request by the Issuer to the Indenture Trustee to take any
action under any provision of this Indenture, the Issuer shall furnish to the
Indenture Trustee (i) an Officer's Certificate stating that all conditions
precedent, if any, provided for in this Indenture relating to the proposed
action have been complied with, (ii) an Opinion of Counsel stating that in
the opinion of such counsel all such conditions precedent, if any, have been
complied with and (iii) (if required by the TIA) an Independent Certificate
from a firm of certified public accountants meeting the applicable
requirements of this Section, except that, in the case of any such
application or request as to which the furnishing of such documents is
specifically required by any provision of this Indenture, no additional
certificate or opinion need be furnished.
Every certificate or opinion with respect to compliance with a
condition or covenant provided for in this Indenture shall include:
(1) a statement that each signatory of such certificate
or opinion has read or has caused to be read such covenant or
condition and the definitions herein relating thereto;
(2) a brief statement as to the nature and scope of the
examination or investigation upon which the statements or opinions
contained in such certificate or opinion are based;
(3) a statement that, in the opinion of each such
signatory, such signatory has made such examination or
investigation as is necessary to enable such signatory to express
an informed opinion as to whether or not such covenant or
condition has been complied with; and
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(4) a statement as to whether, in the opinion of each
such signatory, such condition or covenant has been complied with.
(b) (i) Prior to the deposit of any Collateral or other
property or securities with the Indenture Trustee that is to be
made the basis for the release of any property or securities
subject to the lien of this Indenture, the Issuer shall, in
addition to any obligation imposed in Section 11.01(a) or
elsewhere in this Indenture, furnish to the Indenture Trustee an
Officer's Certificate certifying or stating the opinion of each
person signing such certificate as to the fair value (within 90
days of such deposit) to the Issuer of the Collateral or other
property or securities to be so deposited.
(ii) Whenever the Issuer is required to furnish to the
Indenture Trustee an Officer's Certificate certifying or stating
the opinion of any signer thereof as to the matters described in
clause (i) above, the Issuer shall also deliver to the Indenture
Trustee an Independent Certificate as to the same matters, if the
fair value to the Issuer of the securities to be so deposited and
of all other such securities made the basis of any such withdrawal
or release since the commencement of the then-current fiscal year
of the Issuer, as set forth in the certificates delivered pursuant
to clause (i) above and this clause (ii), is 10% or more of the
Outstanding Amount of the Notes, but such a certificate need not
be furnished with respect to any securities so deposited, if the
fair value thereof to the Issuer as set forth in the related
Officer's Certificate is less than $25,000 or less than one
percent of the Outstanding Amount of the Notes.
(iii) Whenever any property or securities are to be
released from the lien of this Indenture, the Issuer shall also
furnish to the Indenture Trustee an Officer's Certificate
certifying or stating the opinion of each person signing such
certificate as to the fair value (within 90 days of such release)
of the property or securities proposed to be released and stating
that in the opinion of such person the proposed release will not
impair the security under this Indenture in contravention of the
provisions hereof.
(iv) Whenever the Issuer is required to furnish to the
Indenture Trustee an Officer's Certificate certifying or stating
the opinion of any signer thereof as to the matters described in
clause (iii) above, the Issuer shall also furnish to the Indenture
Trustee an Independent Certificate as to the same matters if the
fair value of the property or securities and of all other
property, other than property as contemplated by clause (v) below
or securities released from the lien of this Indenture since the
commencement of the then-current calendar year, as set forth in
the certificates required by clause (iii) above and this clause
(iv), equals 10% or more of the Outstanding Amount of the Notes,
but such certificate need not be furnished in the case of any
release of property or securities if the fair value thereof as set
forth in the related Officer's Certificate is less than $25,000 or
less than one percent of the then Outstanding Amount of the Notes.
(v) Notwithstanding Section 2.10 or any other provision
of this Section, the Issuer may, without compliance with the
requirements of the other provisions of this Section, (A) collect,
liquidate, sell or otherwise dispose of Receivables and Financed
Vehicles as and to the extent permitted or required by the Basic
Documents, (B) make
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cash payments out of the Collection Account as and to the extent
permitted or required by the Basic Documents and (C) convey to the
Seller each Fixed Value Payment and Fixed Value Finance Charge in
accordance with Section 8.04(c), so long as the Issuer shall
deliver to the Indenture Trustee every six months, commencing
December 15, 1998, an Officer's Certificate of the Issuer stating
that all the dispositions of Collateral described in clauses (A),
(B) and (C) above that occurred during the preceding six calendar
months were in the ordinary course of the Issuer's business and
that the proceeds thereof were applied in accordance with the
Basic Documents.
SECTION 11.02. Form of Documents Delivered to Indenture Trustee.
In any case where several matters are required to be certified by, or covered
by an opinion of, any specified Person, it is not necessary that all such
matters be certified by, or covered by the opinion of, only one such Person,
or that they be so certified or covered by only one document, but one such
Person may certify or give an opinion with respect to some matters and one or
more other such Persons as to other matters, and any such Person may certify
or give an opinion as to such matters in one or several documents.
Any certificate or opinion of an Authorized Officer of the Issuer
may be based, insofar as it relates to legal matters, upon a certificate or
opinion of, or representations by, counsel, unless such officer knows, or in
the exercise of reasonable care should know, that the certificate or opinion
or representations with respect to the matters upon which such officer's
certificate or opinion is based are erroneous. Any such certificate of an
Authorized Officer or Opinion of Counsel may be based, insofar as it relates
to factual matters, upon a certificate or opinion of, or representations by,
an officer or officers of the Servicer, the Seller, the Issuer or the
Administrator, stating that the information with respect to such factual
matters is in the possession of the Servicer, the Seller, the Issuer or the
Administrator, unless such counsel knows, or in the exercise of reasonable
care should know, that the certificate or opinion or representations with
respect to such matters are erroneous.
Where any Person is required to make, give or execute two or more
applications, requests, consents, certificates, statements, opinions or other
instruments under this Indenture, they may, but need not, be consolidated and
form one instrument.
Whenever in this Indenture, in connection with any application or
certificate or report to the Indenture Trustee, it is provided that the
Issuer shall deliver any document as a condition of the granting of such
application, or as evidence of the Issuer's compliance with any term hereof,
it is intended that the truth and accuracy, at the time of the granting of
such application or at the effective date of such certificate or report (as
the case may be), of the facts and opinions stated in such document shall in
such case be conditions precedent to the right of the Issuer to have such
application granted or to the sufficiency of such certificate or report. The
foregoing shall not, however, be construed to affect the Indenture Trustee's
right to rely upon the truth and accuracy of any statement or opinion
contained in any such document as provided in Article VI.
SECTION 11.03. Acts of Noteholders. i) Any request, demand,
authorization, direction, notice, consent, waiver or other action provided by
this Indenture to be given or taken by Noteholders may be embodied in and
evidenced by one or more instruments of substantially
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similar tenor signed by such Noteholders in person or by agents duly
appointed in writing; and except as herein otherwise expressly provided such
action shall become effective when such instrument or instruments are
delivered to the Indenture Trustee and, where it is hereby expressly
required, to the Issuer. Such instrument or instruments (and the action
embodied therein and evidenced thereby) are herein sometimes referred to as
the "Act" of the Noteholders signing such instrument or instruments. Proof of
execution of any such instrument or of a writing appointing any such agent
shall be sufficient for any purpose of this Indenture and (subject to Section
6.01) conclusive in favor of the Indenture Trustee and the Issuer, if made in
the manner provided in this Section.
(b) The fact and date of the execution by any person of any such
instrument or writing may be proved in any manner that the Indenture Trustee
deems sufficient.
(c) The ownership of Notes shall be proved by the Note Register.
(d) Any request, demand, authorization, direction, notice,
consent, waiver or other action by the Holder of any Notes shall bind the
Holder of every Note issued upon the registration thereof or in exchange
therefor or in lieu thereof, in respect of anything done, omitted or suffered
to be done by the Indenture Trustee or the Issuer in reliance thereon,
whether or not notation of such action is made upon such Note.
SECTION 11.04. Notices, etc., to Indenture Trustee, Issuer and
Rating Agencies. Any request, demand, authorization, direction, notice,
consent, waiver or Act of Noteholders or other documents provided or
permitted by this Indenture shall be in writing and if such request, demand,
authorization, direction, notice, consent, waiver or act of Noteholders is to
be made upon, given or furnished to or filed with:
(i) the Indenture Trustee by any Noteholder or by the
Issuer shall be sufficient for every purpose hereunder if made,
given, furnished or filed in writing to or with the Indenture
Trustee at its Corporate Trust Office, or
(ii) the Issuer by the Indenture Trustee or by any
Noteholder shall be sufficient for every purpose hereunder if in
writing and mailed first-class, postage prepaid to the Issuer
addressed to: Premier Auto Trust 1998-5, in care of Chase
Manhattan Bank Delaware, 1201 Market Street, Wilmington, Delaware
19801, Attention of Corporate Trustee Administration Department,
or at any other address previously furnished in writing to the
Indenture Trustee by the Issuer or the Administrator. The Issuer
shall promptly transmit any notice received by it from the
Noteholders to the Indenture Trustee.
Notices required to be given to the Rating Agencies by the Issuer,
the Indenture Trustee or the Owner Trustee shall be in writing, personally
delivered or mailed by certified mail, return receipt requested, to (i) in
the case of Moody's, at the following address: Moody's Investors Service,
Inc., ABS Monitoring Department, 99 Church Street, New York, New York 10007,
(ii) in the case of Standard & Poor's, at the following address: Standard &
Poor's Ratings Services, a division of The McGraw-Hill Companies, Inc., 25
Broadway (15th Floor), New York,
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New York 10004, Attention of Asset Backed Surveillance Department, (iii) in
the case of Fitch IBCA, Inc., at the following address: One State Street
Plaza, New York, N.Y. 10004, and (iv) in the case of Duff & Phelps Credit
Rating Co., at the following address: 17 State Street, 12th Floor, New York,
N.Y. 10004; or as to each of the foregoing, at such other address as shall be
designated by written notice to the other parties.
SECTION 11.05. Notices to Noteholders; Waiver. Where this
Indenture provides for notice to Noteholders of any event, such notice shall
be sufficiently given (unless otherwise herein expressly provided) if in
writing and mailed, first-class, postage prepaid to each Noteholder affected
by such event, at such Holder's address as it appears on the Note Register,
not later than the latest date, and not earlier than the earliest date,
prescribed for the giving of such notice. In any case where notice to
Noteholders is given by mail, neither the failure to mail such notice nor any
defect in any notice so mailed to any particular Noteholder shall affect the
sufficiency of such notice with respect to other Noteholders, and any notice
that is mailed in the manner herein provided shall conclusively be presumed
to have been duly given.
Where this Indenture provides for notice in any manner, such
notice may be waived in writing by any Person entitled to receive such
notice, either before or after the event, and such waiver shall be the
equivalent of such notice. Waivers of notice by Noteholders shall be filed
with the Indenture Trustee but such filing shall not be a condition precedent
to the validity of any action taken in reliance upon such a waiver.
In case, by reason of the suspension of regular mail service as a
result of a strike, work stoppage or similar activity, it shall be
impractical to mail notice of any event to Noteholders when such notice is
required to be given pursuant to any provision of this Indenture, then any
manner of giving such notice as shall be satisfactory to the Indenture
Trustee shall be deemed to be a sufficient giving of such notice.
Where this Indenture provides for notice to the Rating Agencies,
failure to give such notice shall not affect any other rights or obligations
created hereunder, and shall not under any circumstance constitute a Default
or Event of Default.
SECTION 11.06. Alternate Payment and Notice Provisions.
Notwithstanding any provision of this Indenture or any of the Notes to the
contrary, the Issuer may enter into any agreement with any Holder of a Note
providing for a method of payment, or notice by the Indenture Trustee or any
Paying Agent to such Holder, that is different from the methods provided for
in this Indenture for such payments or notices. The Issuer will furnish to
the Indenture Trustee a copy of each such agreement and the Indenture Trustee
will cause payments to be made and notices to be given in accordance with
such agreements.
SECTION 11.07. Conflict with Trust Indenture Act. If any provision
hereof limits, qualifies or conflicts with another provision hereof that is
required to be included in this Indenture by any of the provisions of the
Trust Indenture Act, such required provision shall control.
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The provisions of TIA ss.ss. 310 through 317 that impose duties on
any person (including the provisions automatically deemed included herein
unless expressly excluded by this Indenture) are a part of and govern this
Indenture, whether or not physically contained herein.
SECTION 11.08. Effect of Headings and Table of Contents. The
Article and Section headings herein and the Table of Contents are for
convenience only and shall not affect the construction hereof.
SECTION 11.09. Successors and Assigns. All covenants and
agreements in this Indenture and the Notes by the Issuer shall bind its
successors and assigns, whether so expressed or not. All agreements of the
Indenture Trustee in this Indenture shall bind its successors, co-trustees
and agents.
SECTION 11.10. Separability. In case any provision in this
Indenture or in the Notes shall be invalid, illegal or unenforceable, the
validity, legality and enforceability of the remaining provisions shall not
in any way be affected or impaired thereby.
SECTION 11.11. Benefits of Indenture. Nothing in this Indenture or
in the Notes, express or implied, shall give to any Person, other than the
parties hereto and their successors hereunder, and the Noteholders, and any
other party secured hereunder, and any other Person with an ownership
interest in any part of the Trust Estate, any benefit or any legal or
equitable right, remedy or claim under this Indenture.
SECTION 11.12. Legal Holidays. In any case where the date on which
any payment is due shall not be a Business Day, then (notwithstanding any
other provision of the Notes or this Indenture) payment need not be made on
such date, but may be made on the next succeeding Business Day with the same
force and effect as if made on the date on which nominally due, and no
interest shall accrue for the period from and after any such nominal date.
SECTION 11.13. GOVERNING LAW. THIS INDENTURE SHALL BE CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REFERENCE TO ITS
CONFLICT OF LAW PROVISIONS, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE
PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
SECTION 11.14. Counterparts. This Indenture may be executed in any
number of counterparts, each of which so executed shall be deemed to be an
original, but all such counterparts shall together constitute but one and the
same instrument.
SECTION 11.15. Recording of Indenture. If this Indenture is
subject to recording in any appropriate public recording offices, such
recording is to be effected by the Issuer and at its expense accompanied by
an Opinion of Counsel (which may be counsel to the Indenture Trustee or any
other counsel reasonably acceptable to the Indenture Trustee) to the effect
that such recording is necessary either for the protection of the Noteholders
or any other Person secured hereunder or for the enforcement of any right or
remedy granted to the Indenture Trustee under this Indenture.
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SECTION 11.16. Trust Obligation. No recourse may be taken,
directly or indirectly, with respect to the obligations of the Issuer, the
Owner Trustee or the Indenture Trustee on the Notes or under this Indenture
or any certificate or other writing delivered in connection herewith or
therewith, against (i) the Indenture Trustee or the Owner Trustee in its
individual capacity, (ii) any owner of a beneficial interest in the Issuer or
(iii) any partner, owner, beneficiary, agent, officer, director, employee or
agent of the Indenture Trustee or the Owner Trustee in its individual
capacity, any holder of a beneficial interest in the Issuer, the Owner
Trustee or the Indenture Trustee or of any successor or assign of the
Indenture Trustee or the Owner Trustee in its individual capacity, except as
any such Person may have expressly agreed (it being understood that the
Indenture Trustee and the Owner Trustee have no such obligations in their
individual capacity) and except that any such partner, owner or beneficiary
shall be fully liable, to the extent provided by applicable law, for any
unpaid consideration for stock, unpaid capital contribution or failure to pay
any installment or call owing to such entity. For all purposes of this
Indenture, in the performance of any duties or obligations of the Issuer
hereunder, the Owner Trustee shall be subject to, and entitled to the
benefits of, the terms and provisions of Article VI, VII and VIII of the
Trust Agreement.
SECTION 11.17. No Petition. The Indenture Trustee, by entering
into this Indenture, and each Noteholder, by accepting a Note, hereby
covenant and agree that they will not at any time institute against the
Company or the Issuer, or join in any institution against the Company or the
Issuer of, any bankruptcy, reorganization, arrangement, insolvency or
liquidation proceedings, or other proceedings under any United States federal
or state bankruptcy or similar law in connection with any obligations
relating to the Notes, this Indenture or any of the Basic Documents.
SECTION 11.18. Inspection. The Issuer agrees that, on reasonable
prior notice, it will permit any representative of the Indenture Trustee,
during the Issuer's normal business hours, to examine all the books of
account, records, reports and other papers of the Issuer, to make copies and
extracts therefrom, to cause such books to be audited by Independent
certified public accountants, and to discuss the Issuer's affairs, finances
and accounts with the Issuer's officers, employees and Independent certified
public accountants, all at such reasonable times and as often as may be
reasonably requested. The Indenture Trustee shall, and shall cause its
representatives to, hold in confidence all such information except to the
extent disclosure may be required by law (and all reasonable applications for
confidential treatment are unavailing) and except to the extent that the
Indenture Trustee may reasonably determine that such disclosure is consistent
with its obligations hereunder.
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IN WITNESS WHEREOF, the Issuer and the Indenture Trustee have
caused this Indenture to be duly executed by their respective officers,
thereunto duly authorized and duly attested, all as of the day and year first
above written.
PREMIER AUTO TRUST 1998-5,
by: CHASE MANHATTAN BANK DELAWARE, not in
its individual capacity but solely as
Owner Trustee,
by: /s/ John J. Cashin
----------------------
Name: John J. Cashin
Title: Vice President
THE FIRST NATIONAL BANK OF CHICAGO, not in its
individual capacity but solely as
Indenture Trustee,
by: /s/ Jeffrey L. Kinney
-----------------------
Name: Jeffrey L. Kinney
Title: Vice President
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SCHEDULE A
Provided to the Owner Trustee at Closing
<PAGE>
EXHIBIT A-1
[FORM OF CLASS A-1 NOTE]
UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE ISSUER OR
ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY NOTE
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.
THIS NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE "SECURITIES ACT"), OR ANY STATE SECURITIES LAWS.
THE PRINCIPAL OF THIS NOTE IS PAYABLE IN INSTALLMENTS AS SET FORTH HEREIN.
ACCORDINGLY, THE OUTSTANDING PRINCIPAL AMOUNT OF THIS NOTE AT ANY TIME MAY BE
LESS THAN THE AMOUNT SHOWN ON THE FACE HEREOF.
REGISTERED $___________
No. R-__ CUSIP NO. ___________
PREMIER AUTO TRUST 1998-5
CLASS A-1 [____]% ASSET BACKED NOTES
Premier Auto Trust 1998-5, a business trust organized and existing
under the laws of the State of Delaware (herein referred to as the "Issuer"),
for value received, hereby promises to pay to Cede & Co., or registered
assigns, the principal sum of ______________ DOLLARS payable on each
Distribution Date in an amount equal to the result obtained by multiplying
(i) a fraction the numerator of which is $________________ and the
denominator of which is $[_________] by (ii) the aggregate amount, if any,
payable from the Collection Account in respect of principal on the Class A-1
Notes pursuant to Section 3.01 of the Indenture dated as of October 1, 1998
(the "Indenture"), between the Issuer and The First National Bank of Chicago,
a national banking association, as Indenture Trustee (the "Indenture
Trustee"); provided, however, that the entire unpaid principal amount of this
Note shall be due and payable on the [________ 1999] Distribution Date (the
"Class A-1 Final Scheduled Distribution Date"). Capitalized terms used but
not defined herein are defined in Article I of the Indenture, which also
contains rules as to construction that shall be applicable herein.
A-1-1
<PAGE>
The Issuer will pay interest on this Note at the rate per annum
shown above on each Distribution Date until the principal of this Note is
paid or made available for payment, on the principal amount of this Note
outstanding on the preceding Distribution Date (after giving effect to all
payments of principal made on the preceding Distribution Date), subject to
certain limitations contained in the last sentence of Section 3.01 of the
Indenture. Interest on this Note will accrue for each Distribution Date from
and including the most recent Distribution Date on which interest has been
paid (in the case of the first Distribution Date, from the Closing Date) to
but excluding such current Distribution Date. Interest will be computed on
the basis of the actual number of days in the Class A-1 Interest Accrual
Period divided by 360. Such principal of and interest on this Note shall be
paid in the manner specified on the reverse hereof.
The principal of and interest on this Note are payable in such
coin or currency of the United States of America as at the time of payment is
legal tender for payment of public and private debts. All payments made by
the Issuer with respect to this Note shall be applied first to interest due
and payable on this Note as provided above and then to the unpaid principal
of this Note.
Reference is made to the further provisions of this Note set forth
on the reverse hereof, which shall have the same effect as though fully set
forth on the face of this Note.
Unless the certificate of authentication hereon has been executed
by the Indenture Trustee whose name appears below by manual signature, this
Note shall not be entitled to any benefit under the Indenture, or be valid or
obligatory for any purpose.
IN WITNESS WHEREOF, the Issuer has caused this instrument to be
signed, manually or in facsimile, by its Authorized Officer, as of the date
set forth below.
Date: PREMIER AUTO TRUST 1998-5,
by: CHASE MANHATTAN BANK DELAWARE, not in its
individual capacity but solely as Owner
Trustee under the Trust Agreement,
by:_______________________________________
Authorized Signatory
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Notes designated above and referred to in the
within-mentioned Indenture.
Date: THE FIRST NATIONAL BANK OF CHICAGO, not in its
individual capacity but solely as Indenture
Trustee,
by:___________________________________________
Authorized Signatory
A-1-2
<PAGE>
This Note is one of a duly authorized issue of Notes of the
Issuer, designated as its Class A-1 [____]% Asset Backed Notes (herein called
the "Class A-1 Notes"), all issued under the Indenture, to which Indenture
and all indentures supplemental thereto reference is hereby made for a
statement of the respective rights and obligations thereunder of the Issuer,
the Indenture Trustee and the Holders of the Notes. The Class A-1 Notes are
subject to all terms of the Indenture.
The Class A-1 Notes, the Class A-2 Notes, the Class A-3 Notes and
the Class A-4 Notes (collectively, the "Notes") are and will be equally and
ratably secured by the collateral pledged as security therefor as provided in
the Indenture.
Principal of the Class A-1 Notes will be payable on each
Distribution Date in an amount described on the face hereof. "Distribution
Date" means the eighth day of each month, or, if any such date is not a
Business Day, the next succeeding Business Day, commencing November 9, 1998.
As described above, the entire unpaid principal amount of this
Note shall be due and payable on the Class A-1 Final Scheduled Distribution
Date. Notwithstanding the foregoing, the entire unpaid principal amount of
the Notes shall be due and payable on the date on which an Event of Default
shall have occurred and be continuing and the Indenture Trustee or the
Holders of Notes representing not less than a majority of the Outstanding
Amount of the Notes have declared the Notes to be immediately due and payable
in the manner provided in Section 5.02 of the Indenture. All principal
payments on the Class A-1 Notes shall be made pro rata to the Class A-1
Noteholders entitled thereto.
Payments of interest on this Note due and payable on each
Distribution Date, together with the installment of principal, if any, to the
extent not in full payment of this Note, shall be made by check mailed to the
Person whose name appears as the Registered Holder of this Note (or one or
more Predecessor Notes) on the Note Register as of the close of business on
each Record Date, except that with respect to Notes registered on the Record
Date in the name of the nominee of the Clearing Agency (initially, such
nominee to be Cede & Co.), payments will be made by wire transfer in
immediately available funds to the account designated by such nominee. Such
checks shall be mailed to the Person entitled thereto at the address of such
Person as it appears on the Note Register as of the applicable Record Date
without requiring that this Note be submitted for notation of payment. Any
reduction in the principal amount of this Note (or any one or more
Predecessor Notes) effected by any payments made on any Distribution Date
shall be binding upon all future Holders of this Note and of any Note issued
upon the registration of transfer hereof or in exchange hereof or in lieu
hereof, whether or not noted hereon. If funds are expected to be available,
as provided in the Indenture, for payment in full of the then remaining
unpaid principal amount of this Note on a Distribution Date, then the
Indenture Trustee, in the name of and on behalf of the Issuer, will notify
the Person who was the Registered Holder hereof as of the Record Date
preceding such Distribution Date by notice mailed or transmitted by facsimile
prior to such Distribution Date, and the amount then due and payable shall be
payable only upon presentation and surrender of this Note at the Indenture
Trustee's principal Corporate Trust Office or at the office of the Indenture
Trustee's agent appointed for such purposes located in The City of New York.
A-1-3
<PAGE>
The Issuer shall pay interest on overdue installments of interest
at the Class A-1 Interest Rate to the extent lawful.
As provided in the Indenture and subject to the limitations set
forth therein and on the face hereof, the transfer of this Note may be
registered on the Note Register upon surrender of this Note for registration
of transfer at the office or agency designated by the Issuer pursuant to the
Indenture, duly endorsed by, or accompanied by a written instrument of
transfer in form satisfactory to the Indenture Trustee duly executed by, the
Holder hereof or such Holder's attorney duly authorized in writing, with such
signature guaranteed by an "eligible guarantor institution" meeting the
requirements of the Note Registrar, which requirements include membership or
participation in the Securities Transfer Agent's Medallion Program ("STAMP")
or such other "signature guarantee program" as may be determined by the Note
Registrar in addition to, or in substitution for, STAMP, all in accordance
with the Securities Exchange Act of 1934, as amended, and thereupon one or
more new Notes of authorized denominations and in the same aggregate
principal amount will be issued to the designated transferee or transferees.
No service charge will be charged for any registration of transfer or
exchange of this Note, but the transferor may be required to pay a sum
sufficient to cover any tax or other governmental charge that may be imposed
in connection with any such registration of transfer or exchange.
Each Noteholder or Note Owner, by acceptance of a Note or, in the
case of a Note Owner, a beneficial interest in a Note, covenants and agrees
that no recourse may be taken, directly or indirectly, with respect to the
obligations of the Issuer, the Owner Trustee or the Indenture Trustee on the
Notes or under the Indenture or any certificate or other writing delivered in
connection therewith, against (i) the Indenture Trustee or the Owner Trustee
in its individual capacity, (ii) any owner of a beneficial interest in the
Issuer or (iii) any partner, owner, beneficiary, agent, officer, director or
employee of the Indenture Trustee or the Owner Trustee in its individual
capacity, any holder of a beneficial interest in the Issuer, the Owner
Trustee or the Indenture Trustee or of any successor or assign of the
Indenture Trustee or the Owner Trustee in its individual capacity, except as
any such Person may have expressly agreed and except that any such partner,
owner or beneficiary shall be fully liable, to the extent provided by
applicable law, for any unpaid consideration for stock, unpaid capital
contribution or failure to pay any installment or call owing to such entity.
Each Noteholder or Note Owner, by acceptance of a Note or, in the
case of a Note Owner, a beneficial interest in a Note, covenants and agrees
by accepting the benefits of the Indenture that such Noteholder or Note Owner
will not at any time institute against the Seller, the Company or the Issuer,
or join in any institution against the Seller, the Company or the Issuer of,
any bankruptcy, reorganization, arrangement, insolvency or liquidation
proceedings under any United States federal or state bankruptcy or similar
law in connection with any obligations relating to the Notes, the Indenture
or the Basic Documents.
The Issuer has entered into the Indenture and this Note is issued
with the intention that, for federal, state and local income, single business
and franchise tax purposes, the Notes will qualify as indebtedness secured by
the Trust Estate. Each Noteholder, by acceptance of a Note (and each Note
Owner by acceptance of a beneficial interest in a Note), agrees to treat the
Notes
A-1-4
<PAGE>
for federal, state and local income, single business and franchise tax
purposes as indebtedness of the Issuer.
Prior to the due presentment for registration of transfer of this
Note, the Issuer, the Indenture Trustee and any agent of the Issuer or the
Indenture Trustee may treat the Person in whose name this Note (as of the day
of determination or as of such other date as may be specified in the
Indenture) is registered as the owner hereof for all purposes, whether or not
this Note be overdue, and none of the Issuer, the Indenture Trustee or any
such agent shall be affected by notice to the contrary.
The Indenture permits, with certain exceptions as therein
provided, the amendment thereof and the modification of the rights and
obligations of the Issuer and the rights of the Holders of the Notes under
the Indenture at any time by the Issuer with the consent of the Holders of
Notes representing a majority of the Outstanding Amount of all Notes at the
time Outstanding. The Indenture also contains provisions permitting the
Holders of Notes representing specified percentages of the Outstanding Amount
of the Notes, on behalf of the Holders of all the Notes, to waive compliance
by the Issuer with certain provisions of the Indenture and certain past
defaults under the Indenture and their consequences. Any such consent or
waiver by the Holder of this Note (or any one or more Predecessor Notes)
shall be conclusive and binding upon such Holder and upon all future Holders
of this Note and of any Note issued upon the registration of transfer hereof
or in exchange hereof or in lieu hereof whether or not notation of such
consent or waiver is made upon this Note. The Indenture also permits the
Indenture Trustee to amend or waive certain terms and conditions set forth in
the Indenture without the consent of Holders of the Notes issued thereunder.
The term "Issuer" as used in this Note includes any successor to
the Issuer under the Indenture.
The Issuer is permitted by the Indenture, under certain
circumstances, to merge or consolidate, subject to the rights of the
Indenture Trustee and the Holders of Notes under the Indenture.
The Notes are issuable only in registered form in denominations as
provided in the Indenture, subject to certain limitations therein set forth.
This Note and the Indenture shall be construed in accordance with
the laws of the State of New York, without reference to its conflict of law
provisions, and the obligations, rights and remedies of the parties hereunder
and thereunder shall be determined in accordance with such laws.
No reference herein to the Indenture and no provision of this Note
or of the Indenture shall alter or impair the obligation of the Issuer, which
is absolute and unconditional, to pay the principal of and interest on this
Note at the times, place and rate, and in the coin or currency herein
prescribed.
A-1-5
<PAGE>
Anything herein to the contrary notwithstanding, except as
expressly provided in the Basic Documents, none of Chase Manhattan Bank
Delaware in its individual capacity, The First National Bank of Chicago in
its individual capacity, any owner of a beneficial interest in the Issuer, or
any of their respective partners, beneficiaries, agents, officers, directors,
employees or successors or assigns shall be personally liable for, nor shall
recourse be had to any of them for, the payment of principal of or interest
on this Note or performance of, or failure to perform, any of the covenants,
obligations or indemnifications contained in the Indenture. The Holder of
this Note by its acceptance hereof agrees that, except as expressly provided
in the Basic Documents, in the case of an Event of Default under the
Indenture, the Holder shall have no claim against any of the foregoing for
any deficiency, loss or claim therefrom; provided, however, that nothing
contained herein shall be taken to prevent recourse to, and enforcement
against, the assets of the Issuer for any and all liabilities, obligations
and undertakings contained in the Indenture or in this Note.
A-1-6
<PAGE>
ASSIGNMENT
Social Security or taxpayer I.D. or other identifying number of assignee:
_____________________________________________________________________________
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto:
_____________________________________________________________________________
(name and address of assignee)
the within Note and all rights thereunder, and hereby irrevocably constitutes
and appoints ______________________________________________________, attorney,
transfer said Note on the books kept for registration thereof, with full
power of substitution in the premises.
Dated:_________________ _________________________________*/
Signature Guaranteed:
_________________________________*/
___________________
*/ NOTICE: The signature to this assignment must correspond with the
name of the registered owner as it appears on the face of the
within Note in every particular, without alteration, enlargement
or any change whatever. Such signature must be guaranteed by an
"eligible guarantor institution" meeting the requirements of the
Note Registrar, which requirements include membership or
participation in STAMP or such other "signature guarantee program"
as may be determined by the Note Registrar in addition to, or in
substitution for, STAMP, all in accordance with the Securities
Exchange Act of 1934, as amended.
A-1-7
<PAGE>
EXHIBIT A-2
[FORM OF CLASS A-2 NOTE]
UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE ISSUER
OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY NOTE
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.
THE PRINCIPAL OF THIS NOTE IS PAYABLE IN INSTALLMENTS AS SET FORTH
HEREIN. ACCORDINGLY, THE OUTSTANDING PRINCIPAL AMOUNT OF THIS NOTE AT ANY
TIME MAY BE LESS THAN THE AMOUNT SHOWN ON THE FACE HEREOF.
REGISTERED $____________
No. R-__ CUSIP NO.
PREMIER AUTO TRUST 1998-5
CLASS A-2 [____]% ASSET BACKED NOTES
Premier Auto Trust 1998-5, a business trust organized and existing
under the laws of the State of Delaware (herein referred to as the "Issuer"),
for value received, hereby promises to pay to Cede & Co., or registered
assigns, the principal sum of _______________ DOLLARS payable on each
Distribution Date in an amount equal to the result obtained by multiplying
(i) a fraction the numerator of which is $____________ and the denominator of
which is $[____________] by (ii) the aggregate amount, if any, payable from
the Collection Account in respect of principal on the Class A-2 Notes
pursuant to Section 3.01 of the Indenture dated as of October 1, 1998 (the
"Indenture"), between the Issuer and The First National Bank of Chicago, a
national banking association, as Indenture Trustee (the "Indenture Trustee");
provided, however, that the entire unpaid principal amount of this Note shall
be due and payable on the [_________ 200_] Distribution Date (the "Class A-2
Final Scheduled Distribution Date"). No payments of principal of the Class
A-2 Notes shall be made until the Class A-1 Notes have been paid in full.
Capitalized terms used but not defined herein are defined in Article I of the
Indenture, which also contains rules as to construction that shall be
applicable herein.
The Issuer will pay interest on this Note at the rate per annum
shown above on each Distribution Date until the principal of this Note is
paid or made available for payment, on the
A-2-1
<PAGE>
principal amount of this Note outstanding on the preceding Distribution Date
(after giving effect to all payments of principal made on the preceding
Distribution Date), subject to certain limitations contained in the last
sentence of Section 3.01 of the Indenture. Interest on this Note will accrue
for each Distribution Date from the eighth day of the month preceding the
month of such Distribution Date (in the case of the first Distribution Date,
from the Closing Date) to and including the seventh day of the month of such
Distribution Date. Interest will be computed on the basis of a 360-day year
of twelve 30-day months. Such principal of and interest on this Note shall be
paid in the manner specified on the reverse hereof.
The principal of and interest on this Note are payable in such
coin or currency of the United States of America as at the time of payment is
legal tender for payment of public and private debts. All payments made by
the Issuer with respect to this Note shall be applied first to interest due
and payable on this Note as provided above and then to the unpaid principal
of this Note.
Reference is made to the further provisions of this Note set forth
on the reverse hereof, which shall have the same effect as though fully set
forth on the face of this Note.
Unless the certificate of authentication hereon has been executed
by the Indenture Trustee whose name appears below by manual signature, this
Note shall not be entitled to any benefit under the Indenture, or be valid or
obligatory for any purpose.
IN WITNESS WHEREOF, the Issuer has caused this instrument to be
signed, manually or in facsimile, by its Authorized Officer, as of the date
set forth below.
Date: PREMIER AUTO TRUST 1998-5,
by: CHASE MANHATTAN BANK DELAWARE, not in its
individual capacity but solely as Owner
Trustee under the Trust Agreement,
by:______________________________________
Authorized Signatory
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Notes designated above and referred to in the
within-mentioned Indenture.
Date: THE FIRST NATIONAL BANK OF CHICAGO,
not in its individual capacity but
solely as Indenture Trustee,
by:__________________________________________
Authorized Signatory
A-2-2
<PAGE>
This Note is one of a duly authorized issue of Notes of the
Issuer, designated as its Class A-2 [____]% Asset Backed Notes (herein called
the "Class A-2 Notes"), all issued under the Indenture, to which Indenture
and all indentures supplemental thereto reference is hereby made for a
statement of the respective rights and obligations thereunder of the Issuer,
the Indenture Trustee and the Holders of the Notes. The Class A-2 Notes are
subject to all terms of the Indenture.
The Class A-1 Notes, the Class A-2 Notes, the Class A-3 Notes and
the Class A-4 Notes (collectively, the "Notes") are and will be equally and
ratably secured by the collateral pledged as security therefor as provided in
the Indenture.
Principal of the Class A-2 Notes will be payable on each
Distribution Date in an amount described on the face hereof. "Distribution
Date" means the eighth day of each month, or, if any such date is not a
Business Day, the next succeeding Business Day, commencing November 9, 1998.
As described above, the entire unpaid principal amount of this
Note shall be due and payable on the Class A-2 Final Scheduled Distribution
Date. Notwithstanding the foregoing, the entire unpaid principal amount of
the Notes shall be due and payable on the date on which an Event of Default
shall have occurred and be continuing and the Indenture Trustee or the
Holders of Notes representing not less than a majority of the Outstanding
Amount of the Notes have declared the Notes to be immediately due and payable
in the manner provided in Section 5.02 of the Indenture. All principal
payments on the Class A-2 Notes shall be made pro rata to the Class A-2
Noteholders entitled thereto.
Payments of interest on this Note due and payable on each
Distribution Date, together with the installment of principal, if any, to the
extent not in full payment of this Note, shall be made by check mailed to the
Person whose name appears as the Registered Holder of this Note (or one or
more Predecessor Notes) on the Note Register as of the close of business on
each Record Date, except that with respect to Notes registered on the Record
Date in the name of the nominee of the Clearing Agency (initially, such
nominee to be Cede & Co.), payments will be made by wire transfer in
immediately available funds to the account designated by such nominee. Such
checks shall be mailed to the Person entitled thereto at the address of such
Person as it appears on the Note Register as of the applicable Record Date
without requiring that this Note be submitted for notation of payment. Any
reduction in the principal amount of this Note (or any one or more
Predecessor Notes) effected by any payments made on any Distribution Date
shall be binding upon all future Holders of this Note and of any Note issued
upon the registration of transfer hereof or in exchange hereof or in lieu
hereof, whether or not noted hereon. If funds are expected to be available,
as provided in the Indenture, for payment in full of the then remaining
unpaid principal amount of this Note on a Distribution Date, then the
Indenture Trustee, in the name of and on behalf of the Issuer, will notify
the Person who was the Registered Holder hereof as of the Record Date
preceding such Distribution Date by notice mailed or transmitted by facsimile
prior to such Distribution Date, and the amount then due and payable shall be
payable only upon presentation and surrender of this Note at the Indenture
Trustee's principal Corporate Trust Office or at the office of the Indenture
Trustee's agent appointed for such purposes located in The City of New York.
A-2-3
<PAGE>
The Issuer shall pay interest on overdue installments of interest
at the Class A-2 Interest Rate to the extent lawful.
As provided in the Indenture and subject to certain limitations
set forth therein, the transfer of this Note may be registered on the Note
Register upon surrender of this Note for registration of transfer at the
office or agency designated by the Issuer pursuant to the Indenture, duly
endorsed by, or accompanied by a written instrument of transfer in form
satisfactory to the Indenture Trustee duly executed by, the Holder hereof or
such Holder's attorney duly authorized in writing, with such signature
guaranteed by an "eligible guarantor institution" meeting the requirements of
the Note Registrar, which requirements include membership or participation in
the Securities Transfer Agent's Medallion Program ("STAMP") or such other
"signature guarantee program" as may be determined by the Note Registrar in
addition to, or in substitution for, STAMP, all in accordance with the
Securities Exchange Act of 1934, as amended, and thereupon one or more new
Notes of authorized denominations and in the same aggregate principal amount
will be issued to the designated transferee or transferees. No service charge
will be charged for any registration of transfer or exchange of this Note,
but the transferor may be required to pay a sum sufficient to cover any tax
or other governmental charge that may be imposed in connection with any such
registration of transfer or exchange.
Each Noteholder or Note Owner, by acceptance of a Note or, in the
case of a Note Owner, a beneficial interest in a Note, covenants and agrees
that no recourse may be taken, directly or indirectly, with respect to the
obligations of the Issuer, the Owner Trustee or the Indenture Trustee on the
Notes or under the Indenture or any certificate or other writing delivered in
connection therewith, against (i) the Indenture Trustee or the Owner Trustee
in its individual capacity, (ii) any owner of a beneficial interest in the
Issuer or (iii) any partner, owner, beneficiary, agent, officer, director or
employee of the Indenture Trustee or the Owner Trustee in its individual
capacity, any holder of a beneficial interest in the Issuer, the Owner
Trustee or the Indenture Trustee or of any successor or assign of the
Indenture Trustee or the Owner Trustee in its individual capacity, except as
any such Person may have expressly agreed and except that any such partner,
owner or beneficiary shall be fully liable, to the extent provided by
applicable law, for any unpaid consideration for stock, unpaid capital
contribution or failure to pay any installment or call owing to such entity.
Each Noteholder or Note Owner, by acceptance of a Note or, in the
case of a Note Owner, a beneficial interest in a Note, covenants and agrees
by accepting the benefits of the Indenture that such Noteholder or Note Owner
will not at any time institute against the Seller, the Company or the Issuer,
or join in any institution against the Seller, the Company or the Issuer of,
any bankruptcy, reorganization, arrangement, insolvency or liquidation
proceedings under any United States federal or state bankruptcy or similar
law in connection with any obligations relating to the Notes, the Indenture
or the Basic Documents.
The Issuer has entered into the Indenture and this Note is issued
with the intention that, for federal, state and local income, single business
and franchise tax purposes, the Notes will qualify as indebtedness secured by
the Trust Estate. Each Noteholder, by acceptance of a Note (and each Note
Owner by acceptance of a beneficial interest in a Note), agrees to treat the
Notes
A-2-4
<PAGE>
for federal, state and local income, single business and franchise tax
purposes as indebtedness of the Issuer.
Prior to the due presentment for registration of transfer of this
Note, the Issuer, the Indenture Trustee and any agent of the Issuer or the
Indenture Trustee may treat the Person in whose name this Note (as of the day
of determination or as of such other date as may be specified in the
Indenture) is registered as the owner hereof for all purposes, whether or not
this Note be overdue, and none of the Issuer, the Indenture Trustee or any
such agent shall be affected by notice to the contrary.
The Indenture permits, with certain exceptions as therein
provided, the amendment thereof and the modification of the rights and
obligations of the Issuer and the rights of the Holders of the Notes under
the Indenture at any time by the Issuer with the consent of the Holders of
Notes representing a majority of the Outstanding Amount of all Notes at the
time Outstanding. The Indenture also contains provisions permitting the
Holders of Notes representing specified percentages of the Outstanding Amount
of the Notes, on behalf of the Holders of all the Notes, to waive compliance
by the Issuer with certain provisions of the Indenture and certain past
defaults under the Indenture and their consequences. Any such consent or
waiver by the Holder of this Note (or any one or more Predecessor Notes)
shall be conclusive and binding upon such Holder and upon all future Holders
of this Note and of any Note issued upon the registration of transfer hereof
or in exchange hereof or in lieu hereof whether or not notation of such
consent or waiver is made upon this Note. The Indenture also permits the
Indenture Trustee to amend or waive certain terms and conditions set forth in
the Indenture without the consent of Holders of the Notes issued thereunder.
The term "Issuer" as used in this Note includes any successor to
the Issuer under the Indenture.
The Issuer is permitted by the Indenture, under certain
circumstances, to merge or consolidate, subject to the rights of the
Indenture Trustee and the Holders of Notes under the Indenture.
The Notes are issuable only in registered form in denominations as
provided in the Indenture, subject to certain limitations therein set forth.
This Note and the Indenture shall be construed in accordance with
the laws of the State of New York, without reference to its conflict of law
provisions, and the obligations, rights and remedies of the parties hereunder
and thereunder shall be determined in accordance with such laws.
No reference herein to the Indenture and no provision of this Note
or of the Indenture shall alter or impair the obligation of the Issuer, which
is absolute and unconditional, to pay the principal of and interest on this
Note at the times, place and rate, and in the coin or currency herein
prescribed.
A-2-5
<PAGE>
Anything herein to the contrary notwithstanding, except as
expressly provided in the Basic Documents, none of Chase Manhattan Bank
Delaware in its individual capacity, The First National Bank of Chicago in
its individual capacity, any owner of a beneficial interest in the Issuer, or
any of their respective partners, beneficiaries, agents, officers, directors,
employees or successors or assigns shall be personally liable for, nor shall
recourse be had to any of them for, the payment of principal of or interest
on this Note or performance of, or omission to perform, any of the covenants,
obligations or indemnifications contained in the Indenture. The Holder of
this Note by its acceptance hereof agrees that, except as expressly provided
in the Basic Documents, in the case of an Event of Default under the
Indenture, the Holder shall have no claim against any of the foregoing for
any deficiency, loss or claim therefrom; provided, however, that nothing
contained herein shall be taken to prevent recourse to, and enforcement
against, the assets of the Issuer for any and all liabilities, obligations
and undertakings contained in the Indenture or in this Note.
A-2-6
<PAGE>
ASSIGNMENT
Social Security or taxpayer I.D. or other identifying number of assignee:
_____________________________________________________________________________
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto:
_____________________________________________________________________________
(name and address of assignee)
the within Note and all rights thereunder, and hereby irrevocably constitutes
and appoints ______________________________________________________, attorney,
transfer said Note on the books kept for registration thereof, with full
power of substitution in the premises.
Dated:________________________ ________________________________*/
Signature Guaranteed:
________________________________*/
____________________
*/ NOTICE: The signature to this assignment must correspond with the
name of the registered owner as it appears on the face of the
within Note in every particular, without alteration, enlargement
or any change whatever. Such signature must be guaranteed by an
"eligible guarantor institution" meeting the requirements of the
Note Registrar, which requirements include membership or
participation in STAMP or such other "signature guarantee program"
as may be determined by the Note Registrar in addition to, or in
substitution for, STAMP, all in accordance with the Securities
Exchange Act of 1934, as amended.
A-2-7
<PAGE>
EXHIBIT A-3
[FORM OF CLASS A-3 NOTE]
UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE ISSUER OR
ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY NOTE
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.
THE PRINCIPAL OF THIS NOTE IS PAYABLE IN INSTALLMENTS AS SET FORTH HEREIN.
ACCORDINGLY, THE OUTSTANDING PRINCIPAL AMOUNT OF THIS NOTE AT ANY TIME MAY BE
LESS THAN THE AMOUNT SHOWN ON THE FACE HEREOF.
REGISTERED $____________
No. R-__ CUSIP NO. ____________
PREMIER AUTO TRUST 1998-5
CLASS A-3 [_____]% ASSET BACKED NOTES
Premier Auto Trust 1998-5, a business trust organized and existing under the
laws of the State of Delaware (herein referred to as the "Issuer"), for value
received, hereby promises to pay to Cede & Co., or registered assigns, the
principal sum of _____________ DOLLARS payable on each Distribution Date in
an amount equal to the result obtained by multiplying (i) a fraction the
numerator of which is $____________ and the denominator of which is
$[___________] by (ii) the aggregate amount, if any, payable from the
Collection Account in respect of principal on the Class A-3 Notes pursuant to
Section 3.01 of the Indenture dated as of October 1, 1998 (the "Indenture"),
between the Issuer and The First National Bank of Chicago, a national banking
association, as Indenture Trustee (the "Indenture Trustee"); provided,
however, that the entire unpaid principal amount of this Note shall be due
and payable on the [_______ 200_] Distribution Date (the "Class A-3 Final
Scheduled Distribution Date"). No payments of principal of the Class A-3
Notes shall be made until the Class A-1 Notes and the Class A-2 Notes have
been paid in full. Capitalized terms used but not defined herein are defined
in Article I of the Indenture, which also contains rules as to construction
that shall be applicable herein.
The Issuer will pay interest on this Note at the rate per annum
shown above on each Distribution Date until the principal of this Note is
paid or made available for payment, on the principal amount of this Note
outstanding on the preceding Distribution Date (after giving effect
A-3-1
<PAGE>
to all payments of principal made on the preceding Distribution Date),
subject to certain limitations contained in the last sentence of Section 3.01
of the Indenture. Interest on this Note will accrue for each Distribution
Date from the eighth day of the month preceding the month of such
Distribution Date (in the case of the first Distribution Date, from the
Closing Date) to and including the seventh day of the month of such
Distribution Date. Interest will be computed on the basis of a 360-day year
of twelve 30-day months. Such principal of and interest on this Note shall be
paid in the manner specified on the reverse hereof.
The principal of and interest on this Note are payable in such
coin or currency of the United States of America as at the time of payment is
legal tender for payment of public and private debts. All payments made by
the Issuer with respect to this Note shall be applied first to interest due
and payable on this Note as provided above and then to the unpaid principal
of this Note.
Reference is made to the further provisions of this Note set forth
on the reverse hereof, which shall have the same effect as though fully set
forth on the face of this Note.
Unless the certificate of authentication hereon has been executed
by the Indenture Trustee whose name appears below by manual signature, this
Note shall not be entitled to any benefit under the Indenture, or be valid or
obligatory for any purpose.
IN WITNESS WHEREOF, the Issuer has caused this instrument to be
signed, manually or in facsimile, by its Authorized Officer, as of the date
set forth below.
Date: PREMIER AUTO TRUST 1998-5,
by: CHASE MANHATTAN BANK DELAWARE, not in its
individual capacity but solely as
Owner Trustee under the Trust Agreement,
by:______________________________________
Authorized Signatory
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Notes designated above and referred to in the
within-mentioned Indenture.
Date: THE FIRST NATIONAL BANK OF CHICAGO, not in its
individual capacity but solely as Indenture
Trustee,
by:______________________________________
Authorized Signatory
A-3-2
<PAGE>
This Note is one of a duly authorized issue of Notes of the
Issuer, designated as its Class A-3 [____]% Asset Backed Notes (herein called
the "Class A-3 Notes"), all issued under the Indenture, to which Indenture
and all indentures supplemental thereto reference is hereby made for a
statement of the respective rights and obligations thereunder of the Issuer,
the Indenture Trustee and the Holders of the Notes. The Class A-3 Notes are
subject to all terms of the Indenture.
The Class A-1 Notes, the Class A-2 Notes, the Class A-3 Notes and
the Class A-4 Notes (collectively, the "Notes") are and will be equally and
ratably secured by the collateral pledged as security therefor as provided in
the Indenture.
Principal of the Class A-3 Notes will be payable on each
Distribution Date in an amount described on the face hereof. "Distribution
Date" means the eighth day of each month, or, if any such date is not a
Business Day, the next succeeding Business Day, commencing November 9, 1998.
As described above, the entire unpaid principal amount of this
Note shall be due and payable on the Class A-3 Final Scheduled Distribution
Date. Notwithstanding the foregoing, the entire unpaid principal amount of
the Notes shall be due and payable on the date on which an Event of Default
shall have occurred and be continuing and the Indenture Trustee or the
Holders of Notes representing not less than a majority of the Outstanding
Amount of the Notes have declared the Notes to be immediately due and payable
in the manner provided in Section 5.02 of the Indenture. All principal
payments on the Class A-3 Notes shall be made pro rata to the Class A-3
Noteholders entitled thereto.
Payments of interest on this Note due and payable on each
Distribution Date, together with the installment of principal, if any, to the
extent not in full payment of this Note, shall be made by check mailed to the
Person whose name appears as the Registered Holder of this Note (or one or
more Predecessor Notes) on the Note Register as of the close of business on
each Record Date, except that with respect to Notes registered on the Record
Date in the name of the nominee of the Clearing Agency (initially, such
nominee to be Cede & Co.), payments will be made by wire transfer in
immediately available funds to the account designated by such nominee. Such
checks shall be mailed to the Person entitled thereto at the address of such
Person as it appears on the Note Register as of the applicable Record Date
without requiring that this Note be submitted for notation of payment. Any
reduction in the principal amount of this Note (or any one or more
Predecessor Notes) effected by any payments made on any Distribution Date
shall be binding upon all future Holders of this Note and of any Note issued
upon the registration of transfer hereof or in exchange hereof or in lieu
hereof, whether or not noted hereon. If funds are expected to be available,
as provided in the Indenture, for payment in full of the then remaining
unpaid principal amount of this Note on a Distribution Date, then the
Indenture Trustee, in the name of and on behalf of the Issuer, will notify
the Person who was the Registered Holder hereof as of the Record Date
preceding such Distribution Date by notice mailed or transmitted by facsimile
prior to such Distribution Date, and the amount then due and payable shall be
payable only upon presentation and surrender of this Note at the Indenture
Trustee's principal Corporate Trust Office or at the office of the Indenture
Trustee's agent appointed for such purposes located in The City of New York.
A-3-3
<PAGE>
The Issuer shall pay interest on overdue installments of interest
at the Class A-3 Interest Rate to the extent lawful.
As provided in the Indenture and subject to certain limitations
set forth therein, the transfer of this Note may be registered on the Note
Register upon surrender of this Note for registration of transfer at the
office or agency designated by the Issuer pursuant to the Indenture, duly
endorsed by, or accompanied by a written instrument of transfer in form
satisfactory to the Indenture Trustee duly executed by, the Holder hereof or
such Holder's attorney duly authorized in writing, with such signature
guaranteed by an "eligible guarantor institution" meeting the requirements of
the Note Registrar, which requirements include membership or participation in
the Securities Transfer Agent's Medallion Program ("STAMP") or such other
"signature guarantee program" as may be determined by the Note Registrar in
addition to, or in substitution for, STAMP, all in accordance with the
Securities Exchange Act of 1934, as amended, and thereupon one or more new
Notes of authorized denominations and in the same aggregate principal amount
will be issued to the designated transferee or transferees. No service charge
will be charged for any registration of transfer or exchange of this Note,
but the transferor may be required to pay a sum sufficient to cover any tax
or other governmental charge that may be imposed in connection with any such
registration of transfer or exchange.
Each Noteholder or Note Owner, by acceptance of a Note or, in the
case of a Note Owner, a beneficial interest in a Note, covenants and agrees
that no recourse may be taken, directly or indirectly, with respect to the
obligations of the Issuer, the Owner Trustee or the Indenture Trustee on the
Notes or under the Indenture or any certificate or other writing delivered in
connection therewith, against (i) the Indenture Trustee or the Owner Trustee
in its individual capacity, (ii) any owner of a beneficial interest in the
Issuer or (iii) any partner, owner, beneficiary, agent, officer, director or
employee of the Indenture Trustee or the Owner Trustee in its individual
capacity, any holder of a beneficial interest in the Issuer, the Owner
Trustee or the Indenture Trustee or of any successor or assign of the
Indenture Trustee or the Owner Trustee in its individual capacity, except as
any such Person may have expressly agreed and except that any such partner,
owner or beneficiary shall be fully liable, to the extent provided by
applicable law, for any unpaid consideration for stock, unpaid capital
contribution or failure to pay any installment or call owing to such entity.
Each Noteholder or Note Owner, by acceptance of a Note or, in the
case of a Note Owner, a beneficial interest in a Note, covenants and agrees
by accepting the benefits of the Indenture that such Noteholder or Note Owner
will not at any time institute against the Seller, the Company or the Issuer,
or join in any institution against the Seller, the Company or the Issuer of,
any bankruptcy, reorganization, arrangement, insolvency or liquidation
proceedings under any United States federal or state bankruptcy or similar
law in connection with any obligations relating to the Notes, the Indenture
or the Basic Documents.
The Issuer has entered into the Indenture and this Note is issued
with the intention that, for federal, state and local income, single business
and franchise tax purposes, the Notes will qualify as indebtedness secured by
the Trust Estate. Each Noteholder, by acceptance of a Note (and each Note
Owner by acceptance of a beneficial interest in a Note), agrees to treat the
Notes
A-3-4
<PAGE>
for federal, state and local income, single business and franchise tax
purposes as indebtedness of the Issuer.
Prior to the due presentment for registration of transfer of this
Note, the Issuer, the Indenture Trustee and any agent of the Issuer or the
Indenture Trustee may treat the Person in whose name this Note (as of the day
of determination or as of such other date as may be specified in the
Indenture) is registered as the owner hereof for all purposes, whether or not
this Note be overdue, and none of the Issuer, the Indenture Trustee or any
such agent shall be affected by notice to the contrary.
The Indenture permits, with certain exceptions as therein
provided, the amendment thereof and the modification of the rights and
obligations of the Issuer and the rights of the Holders of the Notes under
the Indenture at any time by the Issuer with the consent of the Holders of
Notes representing a majority of the Outstanding Amount of all Notes at the
time Outstanding. The Indenture also contains provisions permitting the
Holders of Notes representing specified percentages of the Outstanding Amount
of the Notes, on behalf of the Holders of all the Notes, to waive compliance
by the Issuer with certain provisions of the Indenture and certain past
defaults under the Indenture and their consequences. Any such consent or
waiver by the Holder of this Note (or any one or more Predecessor Notes)
shall be conclusive and binding upon such Holder and upon all future Holders
of this Note and of any Note issued upon the registration of transfer hereof
or in exchange hereof or in lieu hereof whether or not notation of such
consent or waiver is made upon this Note. The Indenture also permits the
Indenture Trustee to amend or waive certain terms and conditions set forth in
the Indenture without the consent of Holders of the Notes issued thereunder.
The term "Issuer" as used in this Note includes any successor to
the Issuer under the Indenture.
The Issuer is permitted by the Indenture, under certain
circumstances, to merge or consolidate, subject to the rights of the
Indenture Trustee and the Holders of Notes under the Indenture.
The Notes are issuable only in registered form in denominations as
provided in the Indenture, subject to certain limitations therein set forth.
This Note and the Indenture shall be construed in accordance with
the laws of the State of New York, without reference to its conflict of law
provisions, and the obligations, rights and remedies of the parties hereunder
and thereunder shall be determined in accordance with such laws.
No reference herein to the Indenture and no provision of this Note
or of the Indenture shall alter or impair the obligation of the Issuer, which
is absolute and unconditional, to pay the principal of and interest on this
Note at the times, place and rate, and in the coin or currency herein
prescribed.
A-3-5
<PAGE>
Anything herein to the contrary notwithstanding, except as
expressly provided in the Basic Documents, none of Chase Manhattan Bank
Delaware in its individual capacity, The First National Bank of Chicago in
its individual capacity, any owner of a beneficial interest in the Issuer, or
any of their respective partners, beneficiaries, agents, officers, directors,
employees or successors or assigns shall be personally liable for, nor shall
recourse be had to any of them for, the payment of principal of or interest
on this Note or performance of, or omission to perform, any of the covenants,
obligations or indemnifications contained in the Indenture. The Holder of
this Note by its acceptance hereof agrees that, except as expressly provided
in the Basic Documents, in the case of an Event of Default under the
Indenture, the Holder shall have no claim against any of the foregoing for
any deficiency, loss or claim therefrom; provided, however, that nothing
contained herein shall be taken to prevent recourse to, and enforcement
against, the assets of the Issuer for any and all liabilities, obligations
and undertakings contained in the Indenture or in this Note.
A-3-6
<PAGE>
ASSIGNMENT
Social Security or taxpayer I.D. or other identifying number of assignee:
_____________________________________________________________________________
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto:
_____________________________________________________________________________
(name and address of assignee)
the within Note and all rights thereunder, and hereby irrevocably constitutes
and appoints _____________________________________________________ , attorney,
transfer said Note on the books kept for registration thereof, with full power
of substitution in the premises.
Dated:____________________ _____________________________________*/
Signature Guaranteed:
_____________________________________*/
______________________
*/ NOTICE: The signature to this assignment must correspond with the
name of the registered owner as it appears on the face of the
within Note in every particular, without alteration, enlargement
or any change whatever. Such signature must be guaranteed by an
"eligible guarantor institution" meeting the requirements of the
Note Registrar, which requirements include membership or
participation in STAMP or such other "signature guarantee program"
as may be determined by the Note Registrar in addition to, or in
substitution for, STAMP, all in accordance with the Securities
Exchange Act of 1934, as amended.
A-3-7
<PAGE>
EXHIBIT A-4
[FORM OF CLASS A-4 NOTE]
UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE ISSUER OR
ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY NOTE
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.
THE PRINCIPAL OF THIS NOTE IS PAYABLE IN INSTALLMENTS AS SET FORTH HEREIN.
ACCORDINGLY, THE OUTSTANDING PRINCIPAL AMOUNT OF THIS NOTE AT ANY TIME MAY BE
LESS THAN THE AMOUNT SHOWN ON THE FACE HEREOF.
REGISTERED $____________
No. R-__ CUSIP NO. ____________
PREMIER AUTO TRUST 1998-5
CLASS A-4 [____]% ASSET BACKED NOTES
Premier Auto Trust 1998-5, a business trust organized and existing under the
laws of the State of Delaware (herein referred to as the "Issuer"), for value
received, hereby promises to pay to Cede & Co., or registered assigns, the
principal sum of ______________ DOLLARS payable on each Distribution Date in
an amount equal to the result obtained by multiplying (i) a fraction the
numerator of which is $____________ and the denominator of which is
$[____________] by (ii) the aggregate amount, if any, payable from the
Collection Account in respect of principal on the Class A-4 Notes pursuant to
Section 3.01 of the Indenture dated as of October 1, 1998 (the "Indenture"),
between the Issuer and The First National Bank of Chicago, a national banking
association, as Indenture Trustee (the "Indenture Trustee"); provided,
however, that the entire unpaid principal amount of this Note shall be due
and payable on the earlier of the [_________ 200_] Distribution Date (the
"Class A-4 Final Scheduled Distribution Date") and the Redemption Date, if
any, pursuant to Section 10.01 of the Indenture. No payments of principal of
the Class A-4 Notes shall be made until the Class A-1 Notes, the Class A-2
Notes and the Class A-3 Notes have been paid in full. Capitalized terms used
but not defined herein are defined in Article I of the Indenture, which also
contains rules as to construction that shall be applicable herein.
A-4-1
<PAGE>
The Issuer will pay interest on this Note at the rate per annum
shown above on each Distribution Date until the principal of this Note is
paid or made available for payment, on the principal amount of this Note
outstanding on the preceding Distribution Date (after giving effect to all
payments of principal made on the preceding Distribution Date), subject to
certain limitations contained in the last sentence of Section 3.01 of the
Indenture. Interest on this Note will accrue for each Distribution Date from
the eighth day of the month preceding the month of such Distribution Date (in
the case of the first Distribution Date, from the Closing Date) to and
including the seventh day of the month of such Distribution Date. Interest
will be computed on the basis of a 360-day year of twelve 30-day months. Such
principal of and interest on this Note shall be paid in the manner specified
on the reverse hereof.
The principal of and interest on this Note are payable in such
coin or currency of the United States of America as at the time of payment is
legal tender for payment of public and private debts. All payments made by
the Issuer with respect to this Note shall be applied first to interest due
and payable on this Note as provided above and then to the unpaid principal
of this Note.
Reference is made to the further provisions of this Note set forth
on the reverse hereof, which shall have the same effect as though fully set
forth on the face of this Note.
Unless the certificate of authentication hereon has been executed
by the Indenture Trustee whose name appears below by manual signature, this
Note shall not be entitled to any benefit under the Indenture, or be valid or
obligatory for any purpose.
IN WITNESS WHEREOF, the Issuer has caused this instrument to be
signed, manually or in facsimile, by its Authorized Officer, as of the date
set forth below.
Date: PREMIER AUTO TRUST 1998-5,
by: CHASE MANHATTAN BANK DELAWARE, not in its
individual capacity but solely as Owner Trustee
under the Trust Agreement,
by:_______________________________________
Authorized Signatory
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Notes designated above and referred to in the
within-mentioned Indenture.
Date: THE FIRST NATIONAL BANK OF CHICAGO, not in its
individual capacity but solely as Indenture
Trustee,
A-4-2
<PAGE>
by:___________________________________________
Authorized Signatory
A-4-3
<PAGE>
This Note is one of a duly authorized issue of Notes of the
Issuer, designated as its Class A-4 [____]% Asset Backed Notes (herein called
the "Class A-4 Notes"), all issued under the Indenture, to which Indenture
and all indentures supplemental thereto reference is hereby made for a
statement of the respective rights and obligations thereunder of the Issuer,
the Indenture Trustee and the Holders of the Notes. The Class A-4 Notes are
subject to all terms of the Indenture.
The Class A-1 Notes, the Class A-2 Notes, the Class A-3 Notes and
the Class A-4 Notes (collectively, the "Notes") are and will be equally and
ratably secured by the collateral pledged as security therefor as provided in
the Indenture.
Principal of the Class A-4 Notes will be payable on each
Distribution Date in an amount described on the face hereof. "Distribution
Date" means the eighth day of each month, or, if any such date is not a
Business Day, the next succeeding Business Day, commencing November 9, 1998.
As described above, the entire unpaid principal amount of this
Note shall be due and payable on the earlier of the Class A-4 Final Scheduled
Distribution Date and the Redemption Date, if any, pursuant to Section 10.01
of the Indenture. Notwithstanding the foregoing, the entire unpaid principal
amount of the Notes shall be due and payable on the date on which an Event of
Default shall have occurred and be continuing and the Indenture Trustee or
the Holders of Notes representing not less than a majority of the Outstanding
Amount of the Notes have declared the Notes to be immediately due and payable
in the manner provided in Section 5.02 of the Indenture. All principal
payments on the Class A-4 Notes shall be made pro rata to the Class A-4
Noteholders entitled thereto.
Payments of interest on this Note due and payable on each
Distribution Date, together with the installment of principal, if any, to the
extent not in full payment of this Note, shall be made by check mailed to the
Person whose name appears as the Registered Holder of this Note (or one or
more Predecessor Notes) on the Note Register as of the close of business on
each Record Date, except that with respect to Notes registered on the Record
Date in the name of the nominee of the Clearing Agency (initially, such
nominee to be Cede & Co.), payments will be made by wire transfer in
immediately available funds to the account designated by such nominee. Such
checks shall be mailed to the Person entitled thereto at the address of such
Person as it appears on the Note Register as of the applicable Record Date
without requiring that this Note be submitted for notation of payment. Any
reduction in the principal amount of this Note (or any one or more
Predecessor Notes) effected by any payments made on any Distribution Date
shall be binding upon all future Holders of this Note and of any Note issued
upon the registration of transfer hereof or in exchange hereof or in lieu
hereof, whether or not noted hereon. If funds are expected to be available,
as provided in the Indenture, for payment in full of the then remaining
unpaid principal amount of this Note on a Distribution Date, then the
Indenture Trustee, in the name of and on behalf of the Issuer, will notify
the Person who was the Registered Holder hereof as of the Record Date
preceding such Distribution Date by notice mailed or transmitted by facsimile
prior to such Distribution Date, and the amount then due and payable shall be
payable only upon presentation and surrender of this Note at the Indenture
Trustee's principal Corporate
A-4-4
<PAGE>
Trust Office or at the office of the Indenture Trustee's agent appointed for
such purposes located in The City of New York.
The Issuer shall pay interest on overdue installments of interest
at the Class A-4 Interest Rate to the extent lawful.
As provided in the Indenture, the Class A-4 Notes may be redeemed
in whole but not in part at the option of the Servicer on any Distribution
Date on and after the date on which the Pool Balance is less than or equal to
10% of the Original Pool Balance.
As provided in the Indenture and subject to certain limitations
set forth therein, the transfer of this Note may be registered on the Note
Register upon surrender of this Note for registration of transfer at the
office or agency designated by the Issuer pursuant to the Indenture, duly
endorsed by, or accompanied by a written instrument of transfer in form
satisfactory to the Indenture Trustee duly executed by, the Holder hereof or
such Holder's attorney duly authorized in writing, with such signature
guaranteed by an "eligible guarantor institution" meeting the requirements of
the Note Registrar, which requirements include membership or participation in
the Securities Transfer Agent's Medallion Program ("STAMP") or such other
"signature guarantee program" as may be determined by the Note Registrar in
addition to, or in substitution for, STAMP, all in accordance with the
Securities Exchange Act of 1934, as amended, and thereupon one or more new
Notes of authorized denominations and in the same aggregate principal amount
will be issued to the designated transferee or transferees. No service charge
will be charged for any registration of transfer or exchange of this Note,
but the transferor may be required to pay a sum sufficient to cover any tax
or other governmental charge that may be imposed in connection with any such
registration of transfer or exchange.
Each Noteholder or Note Owner, by acceptance of a Note or, in the
case of a Note Owner, a beneficial interest in a Note, covenants and agrees
that no recourse may be taken, directly or indirectly, with respect to the
obligations of the Issuer, the Owner Trustee or the Indenture Trustee on the
Notes or under the Indenture or any certificate or other writing delivered in
connection therewith, against (i) the Indenture Trustee or the Owner Trustee
in its individual capacity, (ii) any owner of a beneficial interest in the
Issuer or (iii) any partner, owner, beneficiary, agent, officer, director or
employee of the Indenture Trustee or the Owner Trustee in its individual
capacity, any holder of a beneficial interest in the Issuer, the Owner
Trustee or the Indenture Trustee or of any successor or assign of the
Indenture Trustee or the Owner Trustee in its individual capacity, except as
any such Person may have expressly agreed and except that any such partner,
owner or beneficiary shall be fully liable, to the extent provided by
applicable law, for any unpaid consideration for stock, unpaid capital
contribution or failure to pay any installment or call owing to such entity.
Each Noteholder or Note Owner, by acceptance of a Note or, in the
case of a Note Owner, a beneficial interest in a Note, covenants and agrees
by accepting the benefits of the Indenture that such Noteholder or Note Owner
will not at any time institute against the Seller, the Company or the Issuer,
or join in any institution against the Seller, the Company or the Issuer of,
any bankruptcy, reorganization, arrangement, insolvency or liquidation
proceedings under any
A-4-5
<PAGE>
United States federal or state bankruptcy or similar law in connection with
any obligations relating to the Notes, the Indenture or the Basic Documents.
The Issuer has entered into the Indenture and this Note is issued
with the intention that, for federal, state and local income, single business
and franchise tax purposes, the Notes will qualify as indebtedness secured by
the Trust Estate. Each Noteholder, by acceptance of a Note (and each Note
Owner by acceptance of a beneficial interest in a Note), agrees to treat the
Notes for federal, state and local income, single business and franchise tax
purposes as indebtedness of the Issuer.
Prior to the due presentment for registration of transfer of this
Note, the Issuer, the Indenture Trustee and any agent of the Issuer or the
Indenture Trustee may treat the Person in whose name this Note (as of the day
of determination or as of such other date as may be specified in the
Indenture) is registered as the owner hereof for all purposes, whether or not
this Note be overdue, and none of the Issuer, the Indenture Trustee or any
such agent shall be affected by notice to the contrary.
The Indenture permits, with certain exceptions as therein
provided, the amendment thereof and the modification of the rights and
obligations of the Issuer and the rights of the Holders of the Notes under
the Indenture at any time by the Issuer with the consent of the Holders of
Notes representing a majority of the Outstanding Amount of all Notes at the
time Outstanding. The Indenture also contains provisions permitting the
Holders of Notes representing specified percentages of the Outstanding Amount
of the Notes, on behalf of the Holders of all the Notes, to waive compliance
by the Issuer with certain provisions of the Indenture and certain past
defaults under the Indenture and their consequences. Any such consent or
waiver by the Holder of this Note (or any one or more Predecessor Notes)
shall be conclusive and binding upon such Holder and upon all future Holders
of this Note and of any Note issued upon the registration of transfer hereof
or in exchange hereof or in lieu hereof whether or not notation of such
consent or waiver is made upon this Note. The Indenture also permits the
Indenture Trustee to amend or waive certain terms and conditions set forth in
the Indenture without the consent of Holders of the Notes issued thereunder.
The term "Issuer" as used in this Note includes any successor to
the Issuer under the Indenture.
The Issuer is permitted by the Indenture, under certain
circumstances, to merge or consolidate, subject to the rights of the
Indenture Trustee and the Holders of Notes under the Indenture.
The Notes are issuable only in registered form in denominations as
provided in the Indenture, subject to certain limitations therein set forth.
This Note and the Indenture shall be construed in accordance with
the laws of the State of New York, without reference to its conflict of law
provisions, and the obligations, rights and remedies of the parties hereunder
and thereunder shall be determined in accordance with such laws.
A-4-6
<PAGE>
No reference herein to the Indenture and no provision of this Note
or of the Indenture shall alter or impair the obligation of the Issuer, which
is absolute and unconditional, to pay the principal of and interest on this
Note at the times, place and rate, and in the coin or currency herein
prescribed.
Anything herein to the contrary notwithstanding, except as
expressly provided in the Basic Documents, none of Chase Manhattan Bank
Delaware in its individual capacity, The First National Bank of Chicago in
its individual capacity, any owner of a beneficial interest in the Issuer, or
any of their respective partners, beneficiaries, agents, officers, directors,
employees or successors or assigns shall be personally liable for, nor shall
recourse be had to any of them for, the payment of principal of or interest
on this Note or performance of, or omission to perform, any of the covenants,
obligations or indemnifications contained in the Indenture. The Holder of
this Note by its acceptance hereof agrees that, except as expressly provided
in the Basic Documents, in the case of an Event of Default under the
Indenture, the Holder shall have no claim against any of the foregoing for
any deficiency, loss or claim therefrom; provided, however, that nothing
contained herein shall be taken to prevent recourse to, and enforcement
against, the assets of the Issuer for any and all liabilities, obligations
and undertakings contained in the Indenture or in this Note.
A-4-7
<PAGE>
ASSIGNMENT
Social Security or taxpayer I.D. or other identifying number of assignee:
_____________________________________________________________________________
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto:
_____________________________________________________________________________
(name and address of assignee)
the within Note and all rights thereunder, and hereby irrevocably constitutes
and appoints ______________________________________________________, attorney,
transfer said Note on the books kept for registration thereof, with full power
of substitution in the premises.
Dated:____________________ ________________________________________*/
Signature Guaranteed:
________________________________________*/
_____________________
*/ NOTICE: The signature to this assignment must correspond with the
name of the registered owner as it appears on the face of the
within Note in every particular, without alteration, enlargement
or any change whatever. Such signature must be guaranteed by an
"eligible guarantor institution" meeting the requirements of the
Note Registrar, which requirements include membership or
participation in STAMP or such other "signature guarantee program"
as may be determined by the Note Registrar in addition to, or in
substitution for, STAMP, all in accordance with the Securities
Exchange Act of 1934, as amended.
A-4-8
<PAGE>
EXHIBIT B
[Form of Note Depository Agreement]
Letter of Representations
[To be Completed by Issuer and Trustee]
[Name of Issuer]
[Name of Trustee]
__________
[Date]
Attention: General Counsel's Office
The Depository Trust Company
55 Water Street; 49th Floor
New York, NY 10041-0099
Re: _______________________________________________________________
[Issue Description]
Ladies and Gentlemen:
This letter sets forth our understanding with respect to certain
matters relating to the above-referenced issue (the "Securities"). Trustee
will act as trustee with respect to the Securities pursuant to a trust
indenture dated _________, 199__ (the "Document"). ________________________
_____________________________ (the "Underwriter") is distributing the
Securities through The Depository Trust Company ("DTC").
To induce DTC to accept the Securities as eligible for deposit at
DTC, and to act in accordance with its Rules with respect to the Securities,
Issuer and Trustee make the following representations to DTC:
1. Prior to closing on the Securities on _____________________,
199_, there shall be deposited with DTC one Security certificate registered
in the name of DTC's nominee, Cede & Co., for each stated maturity of the
Securities in the face amounts set forth on Schedule A hereto, the total of
which represents 100% of the principal amount of such Securities. If,
however, the aggregate principal amount of any maturity exceeds $200 million,
one certificate will be issued with respect to each $200 million of principal
amount and an additional certificate will be issued with respect to any
remaining principal amount. Each Security certificate shall bear the
following legend:
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
B-1
<PAGE>
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.
2. In the event of any solicitation of consents from or voting by
holders of the Securities, Issuer or Trustee shall establish a record date
for such purposes (with no provision for revocation of consents or votes by
subsequent holders) and shall, to the extent possible, send notice of such
record date to DTC not less than 15 calendar days in advance of such record
date. Notices to DTC pursuant to this Paragraph by telecopy shall be sent to
DTC's Reorganization Department at (212) 709-6896 or (212) 709-6897, and
receipt of such notices shall be confirmed by telephoning (212) 709-6870.
Notices to DTC pursuant to this Paragraph by mail or by any other means shall
be sent to DTC's Reorganization Department as indicated in Paragraph 4.
3. In the event of a full or partial redemption, Issuer or Trustee
shall send a notice to DTC specifying: (a) the amount of the redemption or
refunding; (b) in the case of a refunding, the maturity date(s) established
under the refunding; and (c) the date such notice is to be mailed to Security
holders or published (the "Publication Date"). Such notice shall be sent to
DTC by a secure means (e.g., legible telecopy, registered or certified mail,
overnight delivery) in a timely manner designed to assure that such notice is
in DTC's possession no later than the close of business on the business day
before or, if possible, two business days before the Publication Date. Issuer
or Trustee shall forward such notice either in a separate secure transmission
for each CUSIP number or in a secure transmission for multiple CUSIP numbers
(if applicable) which includes a manifest or list of each CUSIP number
submitted in that transmission. (The party sending such notice shall have a
method to verify subsequently the use of such means and the timeliness of
such notice.) The Publication Date shall be not less than 30 days nor more
than 60 days prior to the redemption date or, in the case of an advance
refunding, the date that the proceeds are deposited in escrow. Notices to DTC
pursuant to this Paragraph by telecopy shall be sent to DTC's Call
Notification Department at (516) 227-4039 or (516) 227-4190. If the party
sending the notice does not receive a telecopy receipt from DTC confirming
that the notice has been received, such party shall telephone (516) 227-4070.
Notices to DTC pursuant to this Paragraph by mail or by any other means shall
be sent to:
Manager; Call Notification Department
The Depository Trust Company
711 Stewart Avenue
Garden City, NY 11530-4719
4. In the event of an invitation to tender the Securities
(including mandatory tenders, exchanges, and capital changes), notice by
Issuer or Trustee to Security holders specifying the terms of the tender and
the Publication Date of such notice shall be sent to DTC by a secure means in
the manner set forth in the preceding Paragraph. Notices to DTC
B-2
<PAGE>
pursuant to this Paragraph and notices of other corporate actions by telecopy
shall be sent to DTC's Reorganization Department at (212) 709-1093 or (212)
709-1094, and receipt of such notices shall be confirmed by telephoning (212)
709-6884. Notices to DTC pursuant to the above by mail or by any other means
shall be sent to:
Manager; Reorganization Department
Reorganization Window
The Depository Trust Company
7 Hanover Square, 23rd Floor
New York, NY 10004-2695
5. All notices and payment advices sent to DTC shall contain the
CUSIP number of the Securities.
6. Trustee shall send DTC written notice with respect to the
dollar amount per $1,000 original face value (or other minimum authorized
denomination if less than $1,000 face value) payable on each payment date
allocated as to the interest and principal portions thereof preferably 5, but
not less than 2, business days prior to such payment date. Such notices,
which shall also contain the current pool factor, and special adjustments to
principal/interest rates (e.g., adjustments due to deferred interest or
shortfall), and Trustee contact's name and telephone number, shall be sent by
telecopy to DTC's Dividend Department at (212) 709-1723, or if by mail or by
any other means to:
Manager; Announcements
Dividend Department
The Depository Trust Company
7 Hanover Square, 22nd Floor
New York, NY 10004-2695
7. [Note: Issuer must represent one of the following, and cross
out the other:] [The interest accrual period is record date to record date.]
[The interest accrual period is payment date to payment date.]
8. Trustee must provide DTC, no later than noon (Eastern Time) on
the payment date, CUSIP numbers for each issue for which payment is being
sent, as well as the dollar amount of the payment for each issue.
Notification of payment details should be sent using automated
communications.
9. Interest payments and principal payments that are part of
periodic principal-and-interest payments shall be received by Cede & Co., as
nominee of DTC, or its registered assigns in same-day funds, no later than
2:30 p.m. (Eastern Time) on each payment date (in accordance with existing
arrangements between Issuer or Trustee and DTC). Absent any other
arrangements between Issuer or Trustee and DTC, such funds shall be wired as
follows:
The Chase Manhattan Bank
ABA 021000021
B-3
<PAGE>
For credit to A/C The Depository Trust Company
Dividend Deposit Account 066-026776
Issuer or Trustee shall provide interest payment information to a standard
announcement service subscribed to by DTC. In the unlikely event that no such
service exists, Issuer or Trustee shall provide interest payment information
directly to DTC in advance of the interest payment date as soon as the
information is available. This information should be conveyed directly to DTC
electronically. If electronic transmission is not available, absent any other
arrangements between Trustee and DTC, such information should be sent by
telecopy to DTC's Dividend Department at (212) 709-1723 or (212) 709-1686,
and receipt of such notices shall be confirmed by telephoning (212) 709-1270.
Notices to DTC pursuant to the above by mail or by any other means shall be
sent to:
Manager, Announcements
Dividend Department
The Depository Trust Company
7 Hanover Square; 22nd Floor
New York, NY 10004-2695
10. DTC shall receive maturity and redemption payments allocated
with respect to each CUSIP number on the payable date in same-day funds by
2:30 p.m. (Eastern Time). Absent any other arrangements between Trustee and
DTC, such payments shall be wired as follows:
The Chase Manhattan Bank
ABA 021000021
For credit to A/C The Depository Trust Company
Redemption Account 066-027306
in accordance with existing SDFS payment procedures in the manner set forth
in DTC's SDFS Paying Agent Operating Procedures, a copy of which has
previously been furnished to Trustee.
11. DTC shall receive all reorganization payments and CUSIP-level
detail resulting from corporate actions (such as tender offers, remarketings,
or mergers) on the first payable date in same-day funds by 2:30 p.m. (Eastern
Time). Absent any other arrangements between Trustee and DTC, such payments
shall be wired as follows:
The Chase Manhattan Bank
ABA 021000021
For credit to A/C The Depository Trust Company
Reorganization Account 066-027608
12. DTC may direct Issuer or Trustee to use any other number or
address as the number or address to which notices or payments of interest or
principal may be sent.
13. In the event of a redemption, acceleration, or any other
similar transaction (e.g., tender made and accepted in response to Issuer's
or Trustee's invitation)
B-4
<PAGE>
necessitating a reduction in the aggregate principal amount of Securities
outstanding or an advance refunding of part of the Securities outstanding,
DTC, in its discretion: (a) may request Issuer or Trustee to issue and
authenticate a new Security certificate; or (b) may make an appropriate
notation on the Security certificate indicating the date and amount of such
reduction in principal except in the case of final maturity, in which case
the certificate will be presented to Issuer or Trustee prior to payment, if
required.
14. In the event that Issuer determines that beneficial owners of
Securities shall be able to obtain certificated Securities, Issuer or Trustee
shall notify DTC of the availability of certificates. In such event, Issuer
or Trustee shall issue, transfer, and exchange certificates in appropriate
amounts, as required by DTC and others.
15. DTC may discontinue providing its services as securities
depository with respect to the Securities at any time by giving reasonable
notice to Issuer or Trustee (at which time DTC will confirm with Issuer or
Trustee the aggregate principal amount of Securities outstanding). Under such
circumstances, at DTC's request Issuer and Trustee shall cooperate fully with
DTC by taking appropriate action to make available one or more separate
certificates evidencing Securities to any DTC Participant having Securities
credited to its DTC accounts.
16. Issuer: (a) understands that DTC has no obligation to, and
will not, communicate to its Participants or to any person having an interest
in the Securities any information contained in the Security certificate(s);
and (b) acknowledges that neither DTC's Participants nor any person having an
interest in the Securities shall be deemed to have notice of the provisions
of the Security certificates by virtue of submission of such certificate(s)
to DTC.
B-5
<PAGE>
17. Nothing herein shall be deemed to require Trustee to advance
funds on behalf of Issuer.
Notes: Very truly yours,
- ------
A. If there is a Trustee (as defined
in this Letter of Representations), ___________________________________
Trustee as well as Issuer must sign (Issuer)
this Letter. If there is no Trustee,
in signing this Letter Issuer itself By:________________________________
undertakes to perform all of the (Authorized Officer's Signature)
obligations set forth herein. ___________________________________
(Trustee)
B. Schedule B contains statements that
DTC believes accurately describe DTC, By:________________________________
the method of effecting book-entry (Authorized Officer's Signature)
transfers of securities distributed
through DTC, and certain related
matters.
Received and Accepted:
THE DEPOSITORY TRUST COMPANY
By:_______________________________
cc: Underwriter
Underwriter's Counsel
B-6
<PAGE>
SCHEDULE A
(Describe Issue)
<TABLE>
<CAPTION>
CUSIP Principal Amount Maturity Date Interest Rate
- ----- ---------------- ------------- -------------
<S> <C> <C> <C>
</TABLE>
B-7
<PAGE>
SCHEDULE B
SAMPLE OFFICIAL STATEMENT LANGUAGE
DESCRIBING BOOK-ENTRY-ONLY ISSUANCE
(Prepared by DTC--bracketed material may be applicable only to certain issues)
1. The Depository Trust Company ("DTC"), New York, NY, will act as
securities depository for the securities (the "Securities"). The Securities
will be issued as fully-registered securities registered in the name of Cede
& Co. (DTC's partnership nominee). One fully-registered Security certificate
will be issued for [each issue of the Securities, [each] in the aggregate
principal amount of such issue, and will be deposited with DTC. [If, however,
the aggregate principal amount of [any] issue exceeds $200 million, one
certificate will be issued with respect to each $200 million of principal
amount and an additional certificate will be issued with respect to any
remaining principal amount of such issue.]
2. DTC is a limited-purpose trust company organized under the New
York Banking Law, a "banking organization" within the meaning of the New York
Banking Law, a member of the Federal Reserve System, a "clearing corporation"
within the meaning of the New York Uniform Commercial Code, and a "clearing
agency" registered pursuant to the provisions of Section 17A of the
Securities Exchange Act of 1934. DTC holds securities that its participants
("Participants") deposit with DTC. DTC also facilitates the settlement among
Participants of securities transactions, such as transfers and pledges, in
deposited securities through electronic computerized book-entry changes in
Participants' accounts, thereby eliminating the need for physical movement of
securities certificates. Direct Participants include securities brokers and
dealers, banks, trust companies, clearing corporations, and certain other
organizations. DTC is owned by a number of its Direct Participants and by the
New York Stock Exchange, Inc., the American Stock Exchange, Inc., and the
National Association of Securities Dealers, Inc. Access to the DTC system is
also available to others such as securities brokers and dealers, banks, and
trust companies that clear through or maintain a custodial relationship with
a Direct Participant, either directly or indirectly ("Indirect
Participants"). The Rules applicable to DTC and its Participants are on file
with the Securities and Exchange Commission.
3. Purchases of Securities under the DTC system must be made by or
through Direct Participants, which will receive a credit for the Securities
on DTC's records. The ownership interest of each actual purchaser of each
Security ("Beneficial Owner") is in turn to be recorded on the Direct and
Indirect Participants' records. Beneficial Owners will not receive written
confirmation from DTC of their purchase, but Beneficial Owners are expected
to receive written confirmations providing details of the transaction, as
well as periodic statements of their holdings, from the Direct or Indirect
Participant through which the Beneficial Owner entered into the transaction.
Transfers of ownership interests in the Securities are to be accomplished by
entries made on the books of Participants acting on behalf of Beneficial
Owners. Beneficial Owners will not receive certificates representing their
ownership interests in Securities, except in the event that use of the
book-entry system for the Securities is discontinued.
B-8
<PAGE>
4. To facilitate subsequent transfers, all Securities deposited by
Participants with DTC are registered in the name of DTC's partnership
nominee, Cede & Co. The deposit of Securities with DTC and their registration
in the name of Cede & Co. effect no change in beneficial ownership. DTC has
no knowledge of the actual Beneficial Owners of the Securities; DTC's records
reflect only the identity of the Direct Participants to whose accounts such
Securities are credited, which may or may not be the Beneficial Owners. The
Participants will remain responsible for keeping account of their holdings on
behalf of their customers.
5. Conveyance of notices and other communications by DTC to Direct
Participants, by Direct Participants to Indirect Participants, and by Direct
Participants and Indirect Participants to Beneficial Owners will be governed
by arrangements among them, subject to any statutory or regulatory
requirements as may be in effect from time to time.
[6. Redemption notices shall be sent to Cede & Co. If less than
all of the Securities within an issue are being redeemed, DTC's practice is
to determine by lot the amount of the interest of each Direct Participant in
such issue to be redeemed.]
7. Neither DTC nor Cede & Co. will consent or vote with respect to
Securities. Under its usual procedures, DTC mails an Omnibus Proxy to the
Issuer as soon as possible after the record date. The Omnibus Proxy assigns
Cede & Co.'s consenting or voting rights to those Direct Participants to
whose accounts the Securities are credited on the record date (identified in
a listing attached to the Omnibus Proxy).
8. Principal and interest payments on the Securities will be made
to DTC. DTC's practice is to credit Direct Participants' accounts on payable
date in accordance with their respective holdings shown on DTC's records
unless DTC has reason to believe that it will not receive payment on payable
date. Payments by Participants to Beneficial Owners will be governed by
standing instructions and customary practices, as is the case with securities
held for the accounts of customers in bearer form or registered in "street
name," and will be the responsibility of such Participant and not of DTC,
Trustee, or Issuer, subject to any statutory or regulatory requirements as
may be in effect from time to time. Payment of principal and interest to DTC
is the responsibility of the Issuer or Trustee, disbursement of such payments
to Direct Participants shall be the responsibility of DTC, and disbursement
of such payments to the Beneficial Owners shall be the responsibility of
Direct and Indirect Participants.
[9. A Beneficial Owner shall give notice to elect to have its
Securities purchased or tendered, through its Participant, to Trustee [or
Tender/Remarketing Agent], and shall effect delivery of such Securities by
causing the Direct Participant to transfer the Participant's interest in the
Securities, on DTC's records, to Trustee [or Tender/Remarketing Agent]. The
requirement for physical delivery of Securities in connection with an
optional tender or a mandatory purchase will be deemed satisfied when the
ownership rights in the Securities are transferred by Direct Participants on
DTC's records and followed by a book-entry credit of tendered Securities to
Trustee [or Tender/Remarketing Agent's] DTC account.]
10. DTC may discontinue providing its services as securities
depository with respect to the Securities at any time by giving reasonable
notice to Issuer or Agent. Under such
B-9
<PAGE>
circumstances, in the event that a successor securities depository is not
obtained, Security certificates are required to be printed and delivered.
11. The Issuer may decide to discontinue use of the system of
book-entry transfers through DTC (or a successor securities depository). In
that event, Security certificates will be printed and delivered.
12. The information in this section concerning DTC and DTC's
book-entry system has been obtained from sources that Issuer believes to be
reliable, but Issuer takes no responsibility for the accuracy thereof.
B-10
Conformed Copy
=============================================================================
SALE AND SERVICING AGREEMENT
between
PREMIER AUTO TRUST 1998-5
Issuer,
and
CHRYSLER FINANCIAL CORPORATION,
Seller and Servicer
Dated as of October 1, 1998
=============================================================================
<PAGE>
Table of Contents
Page
----
ARTICLE I
Definitions
SECTION 1.01. Definitions........................................... 1
SECTION 1.02. Other Definitional Provisions......................... 16
ARTICLE II
Conveyance of Receivables
SECTION 2.01. Conveyance of Receivables............................. 17
SECTION 2.02. Conveyance of Fixed Value Payments and Fixed
Value Finance Charges................................. 17
SECTION 2.03. Fixed Value Securities................................ 18
ARTICLE III
The Receivables
SECTION 3.01. Representations and Warranties of Seller
with Respect to the Receivables....................... 19
SECTION 3.02. Repurchase upon Breach................................ 22
SECTION 3.03. Custody of Receivable Files........................... 23
SECTION 3.04. Duties of Servicer as Custodian....................... 23
SECTION 3.05. Instructions; Authority To Act........................ 24
SECTION 3.06. Custodian's Indemnification........................... 24
SECTION 3.07. Effective Period and Termination...................... 24
ARTICLE IV
Administration and Servicing of Receivables
SECTION 4.01. Duties of Servicer.................................... 25
SECTION 4.02. Collection and Allocation of Receivable Payments...... 25
SECTION 4.03. Realization upon Receivables.......................... 26
SECTION 4.04. Physical Damage Insurance............................. 26
SECTION 4.05. Maintenance of Security Interests in
Financed Vehicles..................................... 26
SECTION 4.06. Covenants of Servicer................................. 26
SECTION 4.07. Purchase of Receivables upon Breach................... 26
SECTION 4.08. Servicing Fee......................................... 27
SECTION 4.09. Servicer's Certificate................................ 27
SECTION 4.10. Annual Statement as to Compliance; Notice of Default.. 27
SECTION 4.11. Annual Independent Certified Public Accountants'
Report................................................ 28
SECTION 4.12. Access to Certain Documentation and Information
Regarding Receivables................................. 28
i
<PAGE>
SECTION 4.13. Servicer Expenses..................................... 28
SECTION 4.14. Appointment of Subservicer............................ 28
ARTICLE V
Distributions; Reserve Account;
Statements to Certificateholders and Noteholders
SECTION 5.01. Establishment of Collection Account................... 29
SECTION 5.02. Collections........................................... 31
SECTION 5.03. Application of Collections............................ 31
SECTION 5.04. [ Reserved ].......................................... 32
SECTION 5.05. Additional Deposits................................... 32
SECTION 5.06. Distributions......................................... 32
SECTION 5.07. Reserve Account....................................... 34
SECTION 5.08. [ Reserved ].......................................... 35
SECTION 5.09. Statements to Noteholders and Certificateholders...... 35
SECTION 5.10. Net Deposits.......................................... 36
ARTICLE VI
The Seller
SECTION 6.01. Representations of Seller............................. 36
SECTION 6.02. Corporate Existence................................... 37
SECTION 6.03. Liability of Seller; Indemnities...................... 37
SECTION 6.04. Merger or Consolidation of, or Assumption of
Obligations of, Seller................................ 38
SECTION 6.05. Limitation on Liability of Seller and Others.......... 39
SECTION 6.06. Seller May Own Notes.................................. 39
ARTICLE VII
The Servicer
SECTION 7.01. Representations of Servicer........................... 39
SECTION 7.02. Indemnities of Servicer............................... 40
SECTION 7.03. Merger or Consolidation of, or Assumption of
Obligations of, Servicer.............................. 41
SECTION 7.04. Limitation on Liability of Servicer and Others........ 42
SECTION 7.05. CFC Not To Resign as Servicer......................... 42
ARTICLE VIII
Default
SECTION 8.01. Servicer Default...................................... 43
SECTION 8.02. Appointment of Successor.............................. 44
SECTION 8.03. Notification to Noteholders and Certificateholders.... 44
SECTION 8.04. Waiver of Past Defaults............................... 45
ii
<PAGE>
ARTICLE IX
Termination
SECTION 9.01. Optional Purchase of All Receivables.................. 45
ARTICLE X
Miscellaneous
SECTION 10.01. Amendment............................................. 46
SECTION 10.02. Protection of Title to Trust.......................... 47
SECTION 10.03. Notices............................................... 49
SECTION 10.04. Assignment by the Seller or the Servicer.............. 49
SECTION 10.05. Limitations on Rights of Others....................... 49
SECTION 10.06. Severability.......................................... 49
SECTION 10.07. Separate Counterparts................................. 50
SECTION 10.08. Headings.............................................. 50
SECTION 10.09. Governing Law......................................... 50
SECTION 10.10. Assignment by Issuer.................................. 50
SECTION 10.11. Nonpetition Covenants................................. 50
SECTION 10.12. Limitation of Liability of Owner Trustee and
Indenture Trustee..................................... 50
SCHEDULE A Schedule of Receivables
SCHEDULE B Location of Receivable Files
EXHIBIT A [ Reserved ]
EXHIBIT B Form of Distribution Statement to Noteholders.............. B-1
EXHIBIT C Form of Servicer's Certificate............................. C-1
iii
<PAGE>
SALE AND SERVICING AGREEMENT dated as of October 1, 1998, between
PREMIER AUTO TRUST 1998-5, a Delaware business trust (the "Issuer"),
and CHRYSLER FINANCIAL CORPORATION, a Michigan corporation, as
seller and servicer.
WHEREAS the Issuer desires to purchase a portfolio of receivables
arising in connection with automobile retail installment sale contracts
generated by Chrysler Financial Corporation in the ordinary course of
business; and
WHEREAS Chrysler Financial Corporation is willing to sell such
receivables to, and to service such receivables on behalf of, the Issuer;
NOW, THEREFORE, in consideration of the premises and the mutual
covenants herein contained, the parties hereto agree as follows:
ARTICLE I
Definitions
SECTION 1.01. Definitions. Whenever used in this Agreement, the
following words and phrases, unless the context otherwise requires, shall
have the following meanings:
"Accelerated Principal Distribution Amount" means, with respect to
any Distribution Date, an amount equal to that portion, if any, of the Total
Distribution Amount for such Distribution Date that remains after the payment
of (i) the Servicing Fee (together with any Servicing Fee that remains unpaid
from prior Distribution Dates), (ii) the Noteholders' Interest Distributable
Amount, (iii) the Regular Principal Distribution Amount and (iv) the amount,
if any, required to be allocated to the Reserve Account on such Distribution
Date pursuant to Section 5.06(a)(ii)(C).
"Amortizing Payment" means, with respect to each Fixed Value
Receivable and each Collection Period prior to the date on which the Fixed
Value Payment relating to such Receivable is due, the amount specified in the
applicable Contract in the payment schedule as the "Amount of Each Payment",
except that in the case of a prepayment, liquidation or repurchase by the
Seller or purchase by the Servicer, the Amortizing Payment shall be equal to
the aggregate "Amount of Each Payment" that has not yet been paid for the
period through and including the last payment prior to the date when the
Fixed Value Payment is due less the amount of the unearned finance charges
under the related Contract allocable to such amount in accordance with the
Servicer's customary procedures.
"Amortizing Payment Finance Charge" means, with respect to each
payment collected on a Fixed Value Receivable, the finance charge included in
such payment (as determined in accordance with the Servicer's customary
procedures) that is allocable to the related Principal Balance.
"Amount Financed" means (i) with respect to a Standard Receivable,
the amount advanced under such Standard Receivable toward the purchase price
of the Financed Vehicle and
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any related costs, exclusive of any amount allocable to the premium of
force-placed physical damage insurance covering the Financed Vehicle; and
(ii) with respect to a Fixed Value Receivable, an amount equal to the present
value of the fixed level payment monthly installments (not including the
amount designated as the Fixed Value Payment) under such Fixed Value
Receivable, assuming that each payment is made on the due date in the month
in which such payment is due, discounted at the APR for such Fixed Value
Receivable.
"Annual Percentage Rate" or "APR" of a Receivable means the annual
rate of finance charges stated in the related Contract.
"Basic Documents" means the Indenture, the Trust Agreement, the
Administration Agreement and the Purchase Agreement.
"Cash Release Amount" means on each Distribution Date during the
Release Period, the portion, if any, of the Total Distribution Amount which
remains after payment of (a) the Servicing Fee, (b) the Noteholders' Interest
Distributable Amount, (c) the Release Period Noteholders' Principal
Distributable Amount and (d) the amount, if any, required to increase the
amount in the Reserve Account to the Specified Reserve Amount; provided that
on the Last Release Distribution Date the Cash Release Amount shall equal the
Initial Overcollateralization Amount less the aggregate of the Cash Release
Amounts for all prior Distribution Dates.
"Certificate Balance" has the meaning assigned to such term in the
Trust Agreement.
"Certificateholders" has the meaning assigned to such term in the
Trust Agreement.
"Certificates" means the Trust Certificates and the
Overcollateralization Certificates.
"CFC" means Chrysler Financial Corporation, a Michigan corporation,
or its successors.
"Class" means any one of the classes of Notes.
"Class A-1 Final Scheduled Distribution Date" means the July 1999
Distribution Date.
"Class A-1 Initial Principal Balance" shall mean $380,000,000.00.
"Class A-1 Noteholder" means the Person in whose name a Class A-1
Note is registered in the Note Register.
"Class A-2 Final Scheduled Distribution Date" means the April 2001
Distribution Date.
"Class A-2 Noteholder" means the Person in whose name a Class A-2
Note is registered in the Note Register.
"Class A-3 Final Scheduled Distribution Date" means the July 2002
Distribution Date.
"Class A-3 Noteholder" means the Person in whose name a Class A-3
Note is registered in the Note Register.
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"Class A-4 Final Scheduled Distribution Date" means the April 2003
Distribution Date.
"Class A-4 Noteholder" means the Person in whose name a Class A-4
Note is registered in the Note Register.
"Collection Account" means the account designated as such,
established and maintained pursuant to Section 5.01(a)(i).
"Collection Period" means a calendar month. Any amount stated as of
the last day of a Collection Period or as of the first day of a Collection
Period shall give effect to the following calculations as determined as of
the close of business on such last day: (1) all applications of collections,
and (2) all distributions to be made on the following Distribution Date.
"Company" means Premier Receivables L.L.C., a Michigan limited
liability company, and any successor in interest or, if the Rights (as
defined in the Purchase Agreement) have been assigned to a Person that
becomes a transferee in accordance with Section 5.06 of the Purchase
Agreement, such transferee Person and any successor in interest.
"Contract" means a motor vehicle retail installment sale contract.
"Corporate Trust Office" means the principal office of the Indenture
Trustee at which at any particular time its corporate trust business shall be
administered, which office at the date of the execution of this Agreement is
located at One First National Plaza, Suite 1026, Chicago, IL 60670-0126;
Corporate Trust Services Division; or at such other address as the Indenture
Trustee may designate from time to time by notice to the Noteholders and the
Seller, or the principal corporate trust office of any successor Indenture
Trustee (of which address such successor Indenture Trustee will notify the
Noteholders and the Seller).
"Cutoff Date" means October 14, 1998.
"Dealer" means the dealer who sold a Financed Vehicle and who
originated and assigned the related Receivable to CFC under an existing
agreement between such dealer and CFC.
"Delivery" when used with respect to Trust 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 Indenture Trustee or its nominee or custodian by
physical delivery to the Indenture Trustee or its nominee or
custodian endorsed to, or registered in the name of, the Indenture
Trustee or its nominee or custodian or endorsed in blank, and, with
respect to a certificated security (as
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defined in Section 8-102 of the UCC) transfer thereof (i) by
delivery of such certificated security endorsed to, or registered in
the name of, the Indenture Trustee or its nominee or custodian or
endorsed in blank to a securities intermediary (as defined in
Section 8-102 of the UCC) and the making by such securities
intermediary of entries on its books and records identifying such
certificated securities (as defined in Section 8-102 of the UCC) of
the Indenture Trustee or its nominee or custodian or (ii) by
delivery thereof to a "clearing corporation" (as defined in Section
8-102 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 on its books and records that the certificated
securities are credited to the sole and exclusive securities account
of the securities intermediary, the maintenance of such certificated
securities by such clearing corporation or a custodian or the
nominee of such clearing corporation subject to the clearing
corporation's exclusive control, and the making by such securities
intermediary of entries on its books and records identifying such
certificated securities as being credited to the securities account
of the Indenture Trustee or its nominee or 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
Indenture Trustee or its nominee or custodian; and such additional
or alternative procedures as may hereafter become appropriate to
effect the complete transfer of ownership of any such Trust Account
Property (as defined herein) to the Indenture Trustee or its nominee
or custodian, consistent with changes in applicable law or
regulations or the interpretation thereof;
(b) with respect to any securities issued by the U.S.
Treasury, the Federal Home Loan Mortgage Corporation or by the
Federal National Mortgage Association that are book-entry securities
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 Trust
Account Property to an appropriate book-entry account maintained
with a Federal Reserve Bank by a securities intermediary which is
also a "depository" pursuant to applicable Federal regulations; the
identification by the Federal Reserve Bank of such book-entry
securities on its record being credited to the securities
intermediary's securities account; 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 being credited to the Indenture
Trustee's securities account; and such additional or alternative
procedures as may hereafter become appropriate to effect complete
transfer of ownership of any such Trust Account Property to the
Indenture Trustee or its nominee or custodian, consistent with
changes in applicable law or regulations or the interpretation
thereof; and
(c) with respect to any item of Trust Account Property that
is an uncertificated security under Article 8 of the UCC and that is
not governed by clause (a) 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 Indenture Trustee or its nominee
or custodian of such uncertificated security, the making by such
securities intermediary of entries on its books and records
identifying such uncertificated certificates as belonging to the
Indenture Trustee or its nominee or custodian.
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"Depositor" means the Seller in its capacity as Depositor under the
Trust Agreement.
"Distribution Date" means, with respect to each Collection Period,
the eighth day of the following month or, if such day is not a Business Day,
the immediately following Business Day, commencing on November 9, 1998.
"Eligible Deposit Account" means either (a) a segregated account
with an Eligible Institution or (b) a segregated trust account with the
corporate trust department of a depository institution organized under the
laws of the United States of America or any one of the states thereof or the
District of Columbia (or any domestic branch of a foreign bank), having
corporate trust powers and acting as trustee for funds deposited in such
account, so long as any of the securities of such depository institution
shall have a credit rating from each Rating Agency in one of its generic
rating categories that signifies investment grade.
"Eligible Institution" means (a) the corporate trust department of
the Indenture Trustee, the Owner Trustee or The Chase Manhattan Bank or (b) a
depository institution organized under the laws of the United States of
America or any one of the states thereof or the District of Columbia (or any
domestic branch of a foreign bank), which (i) has either (A) a long-term
unsecured debt rating of AAA or better by Standard & Poor's and A1 or better
by Moody's or (B) a certificate of deposit rating of A-1+ by Standard &
Poor's and P-1 or better by Moody's, or any other long-term, short-term or
certificate of deposit rating acceptable to the Rating Agencies and (ii)
whose deposits are insured by the FDIC. If so qualified, the Indenture
Trustee, the Owner Trustee or The Chase Manhattan Bank may be considered an
Eligible Institution for the purposes of clause (b) of this definition.
"Eligible Investments" means book-entry securities, negotiable
instruments or securities represented by instruments in bearer or registered
form which evidence:
(a) direct obligations of, and obligations fully guaranteed
as to the full and timely payment 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 applicable rating category granted thereby;
(c) commercial paper, variable amount notes or other short
term debt obligations having, at the time of the investment or
contractual commitment to invest therein, a rating from each of the
Rating Agencies in the highest applicable rating category granted
thereby;
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(d) investments in money market or common trust funds
having a rating from each of the Rating Agencies in the highest
applicable rating category granted thereby (including funds for
which the Indenture Trustee or the Owner Trustee or any of their
respective 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;
(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
Exchange Act (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 at the time of entering into such
repurchase obligation (a "Rated Holding Company") or (iv) an unrated
subsidiary (a "Guaranteed Counterparty"), acting as principal, that
is a wholly-owned subsidiary of a direct or indirect parent Rated
Holding Company, which guarantees such subsidiary's obligations
under such repurchase agreement; 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 Guaranteed
Counterparty in respect of which the Standard & Poor's
unsecured short-term ratings 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 sum of the then outstanding
principal balance of the Notes (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 Reserve Account, the rating
from Standard & Poor's in respect of the unsecured
short-term debt obligations of the financial
6
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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 Indenture Trustee or the
Issuer, 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 Indenture Trustee or the Issuer, 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:
(i) the Indenture Trustee or the
Issuer, as applicable, shall have received an
opinion of counsel (which may be in-house 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
as to enforceability to bankruptcy, insolvency,
reorganization and moratorium or other similar
laws affecting creditors' rights generally and to
general equitable principles;
(ii) the Indenture Trustee or the
Issuer, 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;
(iii) 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
Indenture Trustee or the Issuer shall make a
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<PAGE>
demand on the Rated Holding Company to make the
payment due under such guarantee;
(iv) 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
(v) each of Standard & Poor's and
Moody's has confirmed in writing to the Indenture
Trustee or Issuer, 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 Notes.
(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;
(h) any other investment with respect to which the Issuer
or 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 Notes.
"FDIC" means the Federal Deposit Insurance Corporation.
"Final Scheduled Maturity Date" means October 23, 2004.
"Financed Vehicle" means an automobile or light-duty truck, together
with all accessions thereto, securing an Obligor's indebtedness under the
respective Standard Receivable or Fixed Value Receivable.
"First Release Distribution Date" means the first Distribution Date
that is the later of (a) the Distribution Date following the Distribution
Date on which the Overcollateralization Amount is at least equal to the sum
of (i) the Initial Overcollateralization Amount and (ii) the product of (x)
2% and (y) the excess of the Related Pool Balance for such preceding
Distribution Date over the Initial Overcollateralization Amount and (b) the
Distribution Date next succeeding the Distribution Date on which the Class
A-1 Notes have been paid in full.
"Fixed Value Finance Charge" means, with respect to each payment
collected on a Fixed Value Receivable, the finance charge included in such
payment (as determined in accordance with the Servicer's customary
procedures) that is allocable to the related Fixed Value Payment.
"Fixed Value Payment" means, with respect to each Fixed Value
Receivable, the amount specified on the applicable Contract as the "Amount of
Fixed Value Payment" reduced (i) in the
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case of a prepayment or repurchase, by the amount of the unearned finance
charges under the Contract allocable to such payment in accordance with the
Servicer's customary procedures and (ii) in the case of a liquidation, by the
excess of Liquidation Proceeds collected by the Servicer over the Amortizing
Payment on such date.
"Fixed Value Receivable" means any Contract listed on Schedule A
(which Schedule may be in the form of microfiche) that provides for
amortization of the loan over a series of fixed level payment monthly
installments in accordance with the simple interest method, but also requires
a final payment that is greater than the scheduled monthly payments and is
due after payment of such scheduled monthly payments and that may be made by
(i) payment in full in cash of a fixed value amount, (ii) return of the
Financed Vehicle to the Servicer provided certain conditions are satisfied or
(iii) refinancing the final fixed value payment in accordance with specified
conditions.
"Fixed Value Securities" has the meaning assigned to such term in
Section 2.03.
"Indenture" means the Indenture dated as of October 1, 1998, between
the Issuer and the Indenture Trustee.
"Indenture Trustee" means the Person acting as Indenture Trustee
under the Indenture, its successors in interest and any successor trustee
under the Indenture.
"Initial Overcollateralization Amount" means $52,523,447.71.
"Insolvency Event" means, with respect to a specified Person, (a)
the filing of a decree or order for relief by a court having jurisdiction in
the premises in respect of such Person or any substantial part of its
property in an involuntary case under any applicable federal or state
bankruptcy, insolvency or other similar law now or hereafter in effect, or
appointing a receiver, liquidator, assignee, custodian, trustee, sequestrator
or similar official for such Person or for any substantial part of its
property, or ordering the winding-up or liquidation of such Person's affairs,
and such decree or order shall remain unstayed and in effect for a period of
60 consecutive days; or (b) the commencement by such Person of a voluntary
case under any applicable federal or state bankruptcy, insolvency or other
similar law now or hereafter in effect, or the consent by such Person to the
entry of an order for relief in an involuntary case under any such law, or
the consent by such Person to the appointment of or taking possession by a
receiver, liquidator, assignee, custodian, trustee, sequestrator or similar
official for such Person or for any substantial part of its property, or the
making by such Person of any general assignment for the benefit of creditors,
or the failure by such Person generally to pay its debts as such debts become
due, or the taking of action by such Person in furtherance of any of the
foregoing.
"Interest Distribution Amount" means, with respect to any
Distribution Date, the sum of the following amounts, without duplication,
with respect to the Receivables in respect of the Collection Period preceding
such Distribution Date: (a) that portion of all collections on Receivables
allocable to interest (exclusive of collections allocable to Fixed Value
Finance Charges in accordance with Section 5.03(b)), (b) Liquidation Proceeds
with respect to the
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Receivables to the extent allocable to interest due thereon in accordance
with the Servicer's customary servicing procedures, (c) the Purchase Amount
of each Receivable that became a Purchased Receivable during such Collection
Period to the extent attributable to accrued interest on such Receivable, (d)
Recoveries for such Collection Period, and (e) Investment Earnings for the
related Distribution Date; provided, however, that in calculating the
Interest Distribution Amount all payments and proceeds (including Liquidation
Proceeds) of any Purchased Receivables the Purchase Amount of which has been
included in the Interest Distribution Amount in a prior Collection Period
shall be excluded.
"Investment Earnings" means, with respect to any Distribution Date,
the investment earnings (net of losses and investment expenses) on amounts on
deposit in the Collection Account to be applied on such Distribution Date
pursuant to Section 5.01(b).
"Issuer" means Premier Auto Trust 1998-5.
"Last Release Distribution Date" means the Distribution Date on
which the aggregate amount of the Cash Release Amounts released from the lien
of the Indenture pursuant to Section 5.06(a)(ii)(D) on such Distribution Date
and all prior Distribution Dates is equal to the Initial
Overcollateralization Amount.
"Lien" means a security interest, lien, charge, pledge, equity or
encumbrance of any kind, other than tax liens, mechanics' liens and any liens
that attach to the respective Receivable by operation of law as a result of
any act or omission by the related Obligor.
"Liquidated Receivable" means any Receivable liquidated by the
Servicer through the sale of a Financed Vehicle or otherwise.
"Liquidation Proceeds" means, with respect to any Liquidated
Receivable, the moneys collected in respect thereof, from whatever source on
a Liquidated Receivable during the Collection Period in which such Receivable
became a Liquidated Receivable, net of the sum of any amounts expended by the
Servicer in connection with such liquidation and any amounts required by law
to be remitted to the Obligor on such Liquidated Receivable.
"Moody's" means Moody's Investors Service, Inc., or its successor.
"Note Pool Factor" means, with respect to each Class of Notes as of
the close of business on the last day of a Collection Period, a seven-digit
decimal figure equal to the outstanding principal balance of such Class of
Notes (after giving effect to any reductions thereof to be made on the
immediately following Distribution Date) divided by the original outstanding
principal balance of such Class of Notes. The Note Pool Factor will be
1.0000000 as of the Closing Date; thereafter, the Note Pool Factor will
decline to reflect reductions in the outstanding principal balance of such
Class of Notes.
"Noteholders' Distributable Amount" means, with respect to any
Distribution Date, the sum of the Noteholders' Interest Distributable Amount
and the Noteholders' Principal Distributable Amount for such Distribution
Date.
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"Noteholders' Interest Carryover Shortfall" means, with respect to
any Distribution Date, the excess of the sum of the Noteholders' Monthly
Interest Distributable Amount for the preceding Distribution Date and any
outstanding Noteholders' Interest Carryover Shortfall on such preceding
Distribution Date, over the amount in respect of interest that is actually
paid on the Notes on such preceding Distribution Date, plus interest on the
amount of interest due but not paid to Noteholders on the preceding
Distribution Date, to the extent permitted by law, at the respective Interest
Rates borne by each Class of the Notes for the related Interest Period.
"Noteholders' Interest Distributable Amount" means, with respect to
any Distribution Date, the sum of the Noteholders' Monthly Interest
Distributable Amount for such Distribution Date and the Noteholders' Interest
Carryover Shortfall for such Distribution Date. For all purposes of this
Agreement and the Basic Documents, interest with respect to all Classes of
Notes other than the Class A-1 Notes shall be computed on the basis of a
360-day year consisting of twelve 30-day months; and interest with respect to
the Class A-1 Notes shall be computed on the basis of the actual number of
days in each applicable Class A-1 Interest Accrual Period divided by 360.
"Noteholders' Monthly Interest Distributable Amount" means, with
respect to any Distribution Date, interest accrued for the related Interest
Accrual Period or, in the case of the Class A-1 Notes, the related Class A-1
Interest Accrual Period, on each Class of Notes at the respective Interest
Rate for such Class on the outstanding principal balance of the Notes of such
Class on the immediately preceding Distribution Date (or, in the case of the
first Distribution Date, on the Closing Date), after giving effect to all
distributions of principal to the Noteholders of such Class on or prior to
such Distribution Date (or, in the case of the first Distribution Date, on
the Closing Date).
"Noteholders' Monthly Principal Distributable Amount" means, with
respect to any Distribution Date, the sum of (i) the Regular Principal
Distribution Amount plus (ii) the Accelerated Principal Distribution Amount
plus (iii) any accelerated payments of principal required to be made from
amounts allocated to the Reserve Account pursuant to Section 5.07(b)(ii).
"Noteholders' Principal Carryover Shortfall" means, as of the close
of any Distribution Date, the excess of the Noteholders' Monthly Principal
Distributable Amount and any outstanding Noteholders' Principal Carryover
Shortfall from the preceding Distribution Date over the amount in respect of
principal that is actually paid as principal of the Notes on such current
Distribution Date.
"Noteholders' Principal Distributable Amount" means, with respect to
any Distribution Date, the sum of the Noteholders' Monthly Principal
Distributable Amount for such Distribution Date and the Noteholders'
Principal Carryover Shortfall as of the close of the preceding Distribution
Date; provided, however, that the Noteholders' Principal Distributable Amount
shall not exceed the outstanding principal balance of the Notes. In addition,
(a) on the Class A-1 Final Scheduled Distribution Date, the principal
required to be allocated for distribution to the Class A-1 Noteholders will
include the amount necessary (after giving effect to the other amounts to be
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allocated for distribution to the Class A-1 Noteholders on such Distribution
Date and allocable to principal) to reduce the Outstanding Amount of the
Class A-1 Notes to zero; (b) on the Class A-2 Final Scheduled Distribution
Date, the principal required to be allocated for distribution to the Class
A-2 Noteholders will include the amount necessary (after giving effect to the
other amounts to be allocated for distribution to the Class A-2 Noteholders
on such Distribution Date and allocable to principal) to reduce the
Outstanding Amount of the Class A-2 Notes to zero; (c) on the Class A-3 Final
Scheduled Distribution Date, the principal required to be allocated for
distribution to the Class A-3 Noteholders will include the amount necessary
(after giving effect to the other amounts to be allocated for distribution to
the Class A-3 Noteholders on such Distribution Date and allocable to
principal) to reduce the Outstanding Amount of the Class A-3 Notes to zero;
(d) on the Class A-4 Final Scheduled Distribution Date, the principal
required to be allocated for distribution to the Class A-4 Noteholders will
include the amount necessary (after giving effect to the other amounts to be
allocated for distribution to the Class A-4 Noteholders on such Distribution
Date and allocable to principal) to reduce the Outstanding Amount of the
Class A-4 Notes to zero.
"Notes" means the Class A-1 Notes, Class A-2 Notes, Class A-3 Notes
and Class A-4 Notes.
"Obligor" on a Receivable means the purchaser or co-purchasers of
the Financed Vehicle and any other Person who owes payments under the
Receivable.
"Officers' Certificate" means a certificate signed by (a) the
chairman of the board, any vice president, the controller or any assistant
controller and (b) the president, a treasurer, assistant treasurer, secretary
or assistant secretary of the Seller, the Company or the Servicer, as
appropriate.
"OMSC" means Overseas Military Sales Corporation, or its successor.
"OMSC Receivable" means any Standard Receivable acquired by CFC
from OMSC.
"Opinion of Counsel" means one or more written opinions of counsel,
who may be an employee of or counsel to the Seller, the Company or the
Servicer, which counsel shall be acceptable to the Indenture Trustee, the
Owner Trustee or the Rating Agencies, as applicable.
"Original Pool Balance" means $1,802,523,447.71.
"Overcollateralization Amount" means, with respect to any
Distribution Date, (i) the Related Pool Balance minus (ii) the Securities
Amount.
"Overcollateralization Certificates" has the meaning assigned to
such term in the Trust Agreement.
"Overcollateralization Percentage" means, with respect to any
Distribution Date, the percentage derived from the fraction, the numerator of
which is the Overcollateralization Amount for such Distribution Date and the
denominator of which is the Related Pool Balance.
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"Owner Trust Estate" has the meaning assigned to such term in the
Trust Agreement.
"Owner Trustee" means the Person acting as Owner Trustee under the
Trust Agreement, its successors in interest and any successor owner trustee
under the Trust Agreement.
"Payment Determination Date" means, with respect to any Distribution
Date, the Business Day immediately preceding such Distribution Date.
"Physical Property" has the meaning assigned to such term in the
definition of "Delivery" above.
"Pool Balance" means, as of the close of business on the last day of
a Collection Period, the aggregate Principal Balance of the Receivables as of
such day (excluding Purchased Receivables and Liquidated Receivables).
"Principal Balance" of a Receivable, as of the close of business on
the last day of a Collection Period, means the Amount Financed minus the sum
of (i) the portion of all payments made by or on behalf of the related
Obligor on or prior to such day and allocable to principal using the Simple
Interest Method and (ii) any payment of the Purchase Amount with respect to
the Receivable allocable to principal.
"Purchase Agreement" means the Purchase Agreement dated as of
October 1, 1998, between the Seller and the Company.
"Purchase Amount" means the amount, as of the close of business on
the last day of a Collection Period, required to prepay in full a Receivable
under the terms thereof including interest to the end of the month of
purchase.
"Purchased 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 4.07 or by the Seller pursuant to Section 3.02.
"Rating Agency" means Moody's and Standard & Poor's or, if no such
organization or successor is any longer in existence, a nationally recognized
statistical rating organization or other comparable Person designated by the
Seller, notice of which designation shall be given to the Indenture Trustee,
the Owner Trustee and the Servicer. Any notice required to be given to a
Rating Agency pursuant to this Agreement shall also be given to Fitch IBCA,
Inc. and Duff & Phelps Credit Rating Co., although, except as set forth
above, neither shall be deemed to be a Rating Agency for any purposes of this
Agreement.
"Rating Agency Condition" means, with respect to any action, that
each Rating Agency shall have been given 10 days' (or such shorter period as
shall be acceptable to each Rating Agency) prior notice thereof and that each
of the Rating Agencies shall have notified the Seller, the Company, the
Servicer, the Owner Trustee and the Indenture Trustee in writing that such
action will not result in a reduction or withdrawal of the then current
rating of the Notes.
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"Realized Losses" means, with respect to any Receivable that becomes
a Liquidated Receivable, the excess of the Principal Balance of such
Liquidated Receivable over Liquidation Proceeds to the extent allocable to
principal.
"Receivable" means (i) any Standard Receivable and (ii) the
Amortizing Payments with respect to any Fixed Value Receivable.
"Receivable Files" means the documents specified in Section 3.03.
"Recoveries" means, with respect to any Receivable that becomes a
Liquidated Receivable, monies collected in respect thereof, from whatever
source, during any Collection Period following the Collection Period in which
such Receivable became a Liquidated Receivable, net of the sum of any amounts
expended by the Servicer for the account of the Obligor and any amounts
required by law to be remitted to the Obligor.
"Regular Principal Distribution Amount" means, with respect to any
Distribution Date, the sum of the following amounts, without duplication,
with respect to the Receivables in respect of the Collection Period preceding
such Distribution Date: (a) that portion of all collections on Receivables
allocable to principal, (b) all Liquidation Proceeds attributable to the
principal amount of Receivables that became Liquidated Receivables during
such Collection Period in accordance with the Servicer's customary servicing
procedures, plus the amount of Realized Losses with respect to such
Liquidated Receivables and (c) to the extent attributable to principal, the
Purchase Amount of each Receivable that became a Purchased Receivable during
such Collection Period.
"Related Pool Balance" means, with respect to any Distribution Date,
the Pool Balance as of the end of the related Collection Period.
"Release Period" means the period from and including the First
Release Distribution Date to and including the Last Release Distribution
Date.
"Release Period Noteholders' Principal Distributable Amount" means,
with respect to any Distribution Date during the Release Period, the amount
equal to the excess, if any, of (a) the Securities Amount on such
Distribution Date (but prior to giving effect to any distributions on such
Distribution Date) over (b) the product of (1) 95.00% and (2) the Related
Pool Balance; provided further that on the Last Release Distribution Date,
the Release Period Noteholders' Principal Distributable Amount shall equal
(x) the Noteholders' Principal Distributable Amount less (y) the Cash Release
Amount.
"Reserve Account" means the account that is part of the Collection
Account and is designated as such, established and maintained pursuant to
Section 5.01.
"Reserve Account Initial Deposit" means the initial deposit of cash
and Eligible Investments in the amount of $4,375,000.00 made by the Seller
into the Collection Account on the Closing Date.
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"Securities Amount" means, with respect to any Distribution Date,
the sum of the aggregate Outstanding Principal Amount of the Notes and the
Certificate Balance of the Overcollateralization Certificates after giving
effect to payments of principal made on the Notes and the
Overcollateralization Certificates on such Distribution Date.
"Seller" means CFC and its successors in interest to the extent
permitted hereunder.
"Servicer" means CFC, as the servicer of the Receivables, and each
successor to CFC (in the same capacity) pursuant to Section 7.03 or 8.02.
"Servicer Default" means an event specified in Section 8.01.
"Servicer's Certificate" means an Officers' Certificate of the
Servicer delivered pursuant to Section 4.09, substantially in the form of
Exhibit C.
"Servicing Fee" means the fee payable to the Servicer for services
rendered during each Collection Period, determined pursuant to Section 4.08.
"Servicing Fee 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 a fraction, the numerator of which is the number of days elapsed since the
preceding payment of interest was made, the denominator of which is 365, and
the remainder of such payment is allocable to principal.
"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 Reserve Amount" means, with respect to any Distribution
Date, an amount equal to the Reserve Account Initial Deposit.
"Standard & Poor's" means Standard & Poor's Ratings Services, a
division of The McGraw-Hill Companies, Inc., or its successor.
"Standard Receivable" means any Contract listed on Schedule A (which
Schedule may be in the form of microfiche) that is not a Fixed Value
Receivable.
"Total Distribution Amount" means, for each Distribution Date, the
sum of the applicable Interest Distribution Amount and the applicable Regular
Principal Distribution Amount (other than the portion thereof attributable to
Realized Losses).
"Trust" means the Issuer.
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"Trust Account Property" means the Collection Account, all amounts
and investments held from time to time in the Collection Account (whether in
the form of deposit accounts, Physical Property, book-entry securities,
uncertificated securities or otherwise), including the Reserve Account
Initial Deposit, and all proceeds of the foregoing.
"Trust Agreement" means the Amended and Restated Trust Agreement
dated as of October 1, 1998, among the Seller, the Company and the Owner
Trustee.
"Trust Certificates" has the meaning assigned to such term in the
Trust Agreement.
"Trust Officer" means, in the case of the Indenture Trustee, any
Officer within the Corporate Trust Office of the Indenture Trustee, including
any Vice President, Assistant Vice President, Secretary, Assistant Secretary
or any other officer of the Indenture Trustee customarily performing
functions similar to those performed by any of the above designated officers
and also, with respect to a particular matter, any other officer to whom such
matter is referred because of such officer's knowledge of and familiarity
with the particular subject and, with respect to the Owner Trustee, any
officer in the Corporate Trust Administration Department of the Owner Trustee
with direct responsibility for the administration of the Trust Agreement and
the Basic Documents on behalf of the Owner Trustee.
SECTION 1.02. Other Definitional Provisions. (a) Capitalized terms
used herein and not otherwise defined herein shall have the meanings assigned
to them in the Indenture.
(b) All terms defined in this Agreement shall have the defined
meanings when used in any certificate or other document made or delivered
pursuant hereto unless otherwise defined therein.
(c) As used in this Agreement and in any certificate or other
document made or delivered pursuant hereto or thereto, accounting terms not
defined in this Agreement or in any such certificate or other document, and
accounting terms partly defined in this Agreement or in any such certificate
or other document to the extent not defined, shall have the respective
meanings given to them under generally accepted accounting principles. To the
extent that the definitions of accounting terms in this Agreement or in any
such certificate or other document are inconsistent with the meanings of such
terms under generally accepted accounting principles, the definitions
contained in this Agreement or in any such certificate or other document
shall control.
(d) The words "hereof", "herein", "hereunder" and words of similar
import when used in this Agreement shall refer to this Agreement as a whole
and not to any particular provision of this Agreement; Article, Section,
Schedule and Exhibit references contained in this Agreement are references to
Articles, Sections, Schedules and Exhibits in or to this Agreement unless
otherwise specified; and the term "including" shall mean "including without
limitation".
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(e) The definitions contained in this Agreement are applicable to
the singular as well as the plural forms of such terms and to the masculine
as well as to the feminine and neuter genders of such terms.
(f) Any agreement, instrument or statute defined or referred to
herein or in any instrument or certificate delivered in connection herewith
means such agreement, instrument or statute as from time to time amended,
modified or supplemented and includes (in the case of agreements or
instruments) references to all attachments thereto and instruments
incorporated therein; references to a Person are also to its permitted
successors and assigns.
ARTICLE II
Conveyance of Receivables
SECTION 2.01. Conveyance of Receivables. In consideration of the
Issuer's delivery to or upon the order of the Seller of (x)
$[1,297,580,312.50] (which amount represents the Original Pool Balance less
(i) the Reserve Account Initial Deposit, (ii) the Initial
Overcollateralization Amount, (iii) the Class A-1 Initial Principal Balance,
(iv) the Initial Certificate Balance (as defined in the Trust Agreement) and
(v) certain other expenses of the Issuer), and (y) the Certificates, the
Seller does hereby sell, transfer, assign, set over and otherwise convey to
the Issuer, without recourse (subject to the obligations of the Seller set
forth herein), all right, title and interest of the Seller in and to:
(a) the Receivables and all moneys received thereon on and
after October 14, 1998;
(b) the security interests in the Financed Vehicles granted
by Obligors pursuant to the Receivables and any other interest of
the Seller in the Financed Vehicles;
(c) any proceeds with respect to the Receivables from
claims on any physical damage, credit life or disability insurance
policies covering Financed Vehicles or Obligors;
(d) any proceeds from recourse to Dealers with respect to
Receivables with respect to which the Servicer has determined in
accordance with its customary servicing procedures that eventual
payment in full is unlikely;
(e) any Financed Vehicle that shall have secured a
Receivable and shall have been acquired by or on behalf of the
Seller, the Servicer, the Company or the Trust;
(f) all right, title and interest in all funds on deposit
from time to time in the Collection Account, including the Reserve
Account Initial Deposit, and in all investments and proceeds thereof
(including all income thereon); and
(g) the proceeds of any and all of the foregoing.
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(h) The Seller hereby directs the Issuer to issue the
Certificates to the Company. The Seller and the Issuer acknowledge
that $380,000,000.00 of the purchase price of the Receivables owed
by the Issuer to the Seller pursuant to this Section 2.01 shall be
offset by the Issuer against delivery of the Class A-1 Notes to the
Seller.
SECTION 2.02. Conveyance of Fixed Value Payments and Fixed Value
Finance Charges. Promptly following the transfer to the Issuer of the
Receivables on the Closing Date, the Issuer shall, without further action
hereunder, be deemed to sell, transfer, assign, set over and otherwise convey
to the Seller, effective as of the Closing Date, without recourse,
representation or warranty, all the right, title and interest of the Issuer
in and to the Fixed Value Payments and the Fixed Value Finance Charges, all
monies due and to become due and all amounts received with respect thereto
and all proceeds thereof, subject to Section 5.03(b).
SECTION 2.03. Fixed Value Securities. i) At any time after the
Closing Date, at the option of the Seller and upon 10 days prior notice to
the Owner Trustee and the Indenture Trustee, the Seller will be permitted to
sell to the Issuer, and the Issuer shall be obligated to purchase from the
Seller (subject to the availability of funds), all or any portion of the
Fixed Value Payments and/or Fixed Value Finance Charges, subject to the terms
and conditions described below. Upon any such sale, (x) the Seller and the
Owner Trustee will enter into an amendment to this Agreement and the Basic
Documents to provide for, at the election of the Seller, the issuance of
certificates representing ownership interests in the Trust to the extent of
such Fixed Value Payments and/or Fixed Value Finance Charges or the issuance
of indebtedness by the Issuer secured by such Fixed Value Payments
(collectively, the "Fixed Value Securities") and to make any other provisions
herein or therein that are necessary or desirable in connection therewith and
(y) the Owner Trustee will enter into any other agreements or instruments
related thereto as requested by the Seller; provided, however, that the Owner
Trustee may, but shall not be obligated to, enter into any such amendment,
agreement or instrument that affects the Owner Trustee's own rights, duties
or immunities under this Agreement or any other Basic Document; and provided,
further, that the obligation of the Issuer to purchase such Fixed Value
Payments and/or Fixed Value Finance Charges and of the Owner Trustee to enter
into any such amendment or other agreement or instrument is subject to the
following conditions precedent:
(i) such amendment and other agreements and instruments, in
forms satisfactory to the Owner Trustee and, in the case of
amendments or agreements to be executed and delivered by the
Indenture Trustee, in forms satisfactory to the Indenture Trustee,
shall have been executed by each other party thereto and delivered
to the Owner Trustee or the Indenture Trustee as appropriate;
(ii) the Seller shall have delivered to the Owner Trustee
and the Indenture Trustee an Officers' Certificate and an Opinion of
Counsel to the effect that each condition precedent (including the
requirement with respect to all required filings) provided by this
Section has been complied with and such amendment or other agreement
or instrument is authorized or permitted by this Agreement;
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(iii) the Rating Agency Condition shall have been satisfied
with respect to such sale and issuance;
(iv) such sale and issuance and such amendment or other
agreement or instrument shall not adversely affect in any material
respect the interest of any Noteholder or Certificateholder, and the
Depositor shall have provided to the Owner Trustee and the Indenture
Trustee an Officers' Certificate to such effect;
(v) the Owner Trustee and the Indenture Trustee shall have
received an Opinion of Counsel to the effect that such sale and
issuance will not have any material tax consequence to any
Noteholder or Certificateholder; and
(vi) all filings and other actions required to continue the
first perfected interest of the Trust in the Owner Trust Estate and
the Indenture Trustee in the Collateral shall have been duly made or
taken by the Seller.
(b) Except as described in Section 10.04, the Seller will not sell,
transfer, assign, set over or otherwise convey the Fixed Value Payments and
Fixed Value Finance Charges other than to the Issuer pursuant to paragraph
i).
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 Issuer is deemed to have relied
in acquiring the Receivables. Such representations and warranties speak as of
the execution and delivery of this Agreement and as of the Closing Date, but
shall survive the sale, transfer and assignment of the Receivables to the
Issuer and the pledge thereof to the Indenture Trustee pursuant to the
Indenture.
(a) Characteristics of Receivables. Each Standard
Receivable and Fixed Value Receivable (A) was 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,
was fully and properly executed by the parties thereto, was
purchased by the Seller from such Dealer under an existing dealer
agreement, (B) has created or shall create a valid, subsisting and
enforceable first priority security interest in favor of the Seller
and is assignable by the Seller to the Issuer and by the Issuer to
the Indenture Trustee, (C) contains customary and enforceable
provisions such that the rights and remedies of the holder thereof
are adequate for realization against the collateral of the benefits
of the security, and (D) provides for level monthly payments
(provided, that the payment in the first or last month in the life
of the Standard Receivable or Fixed Value Receivable may be
minimally different from the level payments and that the payment in
the last month of a Fixed Value Receivable may be a Fixed Value
Payment) that fully amortize the Amount
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Financed by maturity and yield interest at the Annual Percentage
Rate. No Receivable conveyed to the Issuer on the Closing Date is an
OMSC Receivable.
(b) Schedule of Receivables. The information set forth in
Schedule A to this Agreement is true and correct in all material
respects as of the opening of business on the applicable Cutoff
Date, and no selection procedures believed to be adverse to the
Noteholders or Certificateholders were utilized in selecting the
Receivables. The computer tape or other listing regarding the
Standard Receivables and the Fixed Value Receivables made available
to the Issuer and its assigns (which computer tape or other listing
is required to be delivered as specified herein) is true and correct
in all respects.
(c) Compliance with Law. Each Standard Receivable and Fixed
Value 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 (or, in the case of the OMSC Receivables, Swiss laws and
regulations and the laws and regulations of the jurisdiction where
the Receivable was originated), 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
Federal Reserve Board's Regulations B and Z, the Texas Consumer
Credit Code and State adaptations of the National Consumer Act and
of the Uniform Consumer Credit Code, and other consumer credit laws
and equal credit opportunity and disclosure laws.
(d) Binding Obligation. Each Standard Receivable and Fixed
Value 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.
(e) No Government Obligor. None of the Standard Receivables
or Fixed Value Receivables is due from the United States of America
or any State or from any agency, department or instrumentality of
the United States of America or any State.
(f) Security Interest in Financed Vehicle. Immediately
prior to the sale, assignment and transfer thereof, each Standard
Receivable and Fixed Value Receivable shall be secured by a validly
perfected first security interest in the Financed Vehicle in favor
of the Seller as secured party or all necessary and appropriate
actions have been commenced that would result in the valid
perfection of a first security interest in the Financed Vehicle in
favor of the Seller as secured party.
(g) Receivables in Force. No Standard Receivable or Fixed
Value Receivable has been satisfied, subordinated or rescinded, nor
has any Financed Vehicle been released from the lien granted by the
related Standard Receivable or Fixed Value Receivable in whole or in
part.
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(h) No Amendments. No Standard Receivable or Fixed Value
Receivable has been amended such that the amount of the Obligor's
scheduled payments has been increased except for increases resulting
from the inclusion of any premiums for forced placed physical damage
insurance covering the Financed Vehicle.
(i) No Waiver. No provision of a Standard Receivable or
Fixed Value Receivable has been waived.
(j) No Defenses. No right of rescission, setoff,
counterclaim or defense has been asserted or threatened with respect
to any Standard Receivable or Fixed Value Receivable.
(k) No Liens. To the best of the Seller's knowledge, no
liens or claims have been filed for work, labor or materials
relating to a Financed Vehicle that are liens prior to, or equal to
or coordinate with, the security interest in the Financed Vehicle
granted by any Standard Receivable or Fixed Value Receivable.
(l) No Default. No Standard Receivable or Fixed Value
Receivable has a payment that is more than 30 days overdue as of the
related Cutoff Date, and, except as permitted in this paragraph, no
default, breach, violation or event permitting acceleration under
the terms of any Standard Receivable or Fixed Value 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 Standard Receivable
or Fixed Value Receivable has arisen; and the Seller has not waived
and shall not waive any of the foregoing.
(m) Insurance. The Seller, in accordance with its customary
procedures, has determined that, at the origination of the Standard
Receivable or Fixed Value Receivable, the Obligor had obtained
physical damage insurance covering the Financed Vehicle and under
the terms of the Standard Receivable and Fixed Value Receivable the
Obligor is required to maintain such insurance.
(n) Title. It is the intention of the Seller that the
transfer and assignment herein contemplated constitute a sale of the
Standard Receivables and Fixed Value Receivables from the Seller to
the Issuer and that the beneficial interest in and title to the
Standard Receivables and Fixed Value Receivables not be part of the
debtor's estate in the event of the filing of a bankruptcy petition
by or against the Seller under any bankruptcy law. No Standard
Receivable or Fixed Value Receivable has been sold, transferred,
assigned or pledged by the Seller to any Person other than the
Issuer. Immediately prior to the transfer and assignment herein
contemplated, the Seller had good and marketable title to each
Standard Receivable and Fixed Value Receivable free and clear of all
Liens, encumbrances, security interests and rights of others and,
immediately upon the transfer thereof, the Issuer shall have good
and marketable title to each Standard Receivable and Fixed Value
Receivable, free and clear of all Liens, encumbrances, security
interests and rights of others; and the transfer has been perfected
under the UCC.
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(o) Lawful Assignment. No Standard Receivable or Fixed
Value Receivable has been originated in, or is subject to the laws
of, any jurisdiction under which the sale, transfer and assignment
of such Standard Receivable or Fixed Value Receivable or any
Receivable under this Agreement or the Indenture is unlawful, void
or voidable.
(p) All Filings Made. All filings (including UCC filings)
necessary in any jurisdiction to give the Issuer a first perfected
ownership interest in the Standard Receivable and Fixed Value
Receivables, and to give the Indenture Trustee a first perfected
security interest therein, shall have been made.
(q) One Original. There is only one original executed copy
of each Standard Receivable and Fixed Value Receivable.
(r) Maturity of Receivables. Each Standard Receivable and
Fixed Value Receivable has a final maturity date not later than
October 31, 2004.
(s) Scheduled Payments. (A) Each Standard Receivable and
Fixed Value Receivable has a first scheduled due date on or prior to
the end of the month following the related Cutoff Date and (B) no
Standard Receivable or Fixed Value Receivable has a payment that is
more than 30 days overdue as of the related Cutoff Date, and has a
final scheduled payment date no later than the Final Scheduled
Maturity Date.
(t) Location of Receivable Files. The Receivable Files are
kept at one or more of the locations listed in Schedule B.
(u) Remaining Maturity. The latest scheduled maturity of
any Standard Receivable or Fixed Value Receivable shall be no later
than the Final Scheduled Maturity Date.
(v) Outstanding Principal Balance. Each Standard Receivable
and Fixed Value Receivable has an outstanding principal balance of
at least $300.00.
(w) No Bankruptcies or First-Time Buyers. No Obligor on any
Standard Receivable or Fixed Value Receivable as of the related
Cutoff Date was noted in the related Receivable File as the subject
of a bankruptcy proceeding, and no such Obligor financed a Financed
Vehicle under the Seller's "New Finance Buyer Plan" program.
(x) No Repossessions. No Financed Vehicle securing any
Standard Receivable or Fixed Value Receivable is in repossession
status.
(y) Chattel Paper. Each Standard Receivable and Fixed Value
Receivable constitutes "chattel paper" as defined in the UCC.
(z) Agreement. The representations of the Seller in Section
6.01 are true and correct.
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(aa) Financing. As of the Cutoff Date, approximately 19.46%
of the aggregate principal balance of the Receivables, constituting
22.82% of the number of Receivables, represents previously titled
vehicles; approximately 80.54% of the aggregate principal balance of
the Receivables, constituting 77.18% of the number of Receivables,
represents financing of vehicles manufactured or distributed by
Chrysler Corporation; all of the Receivables are Simple Interest
Receivables; by aggregate principal balance, approximately 21.24% of
the Receivables are Fixed Value Receivables. The aggregate principal
balance of the Receivables, as of the Cutoff Date is
$1,802,523,447.71. Receivable shall mean only that portion of the
Receivables with respect to which the Trust has an ownership
interest.
SECTION 3.02. Repurchase upon Breach. The Seller, the Servicer or
the Owner Trustee, as the case may be, shall inform the other parties to this
Agreement and the Indenture Trustee promptly, in writing, upon the discovery
of any breach of the Seller's representations and warranties made pursuant to
Section 3.01 or 6.01. Unless any such breach shall have been cured by the
last day of the second Collection Period following the discovery thereof by
the Owner Trustee or receipt by the Owner Trustee of written notice from the
Seller or the Servicer of such breach, the Seller shall be obligated to
repurchase any Receivable materially and adversely affected by any such
breach as of such last day (or, at the Seller's option, the last day of the
first Collection Period following the discovery). In consideration of the
repurchase of any such Receivable, the Seller shall remit the Purchase
Amount, in the manner specified in Section 5.05. Subject to the provisions of
Section 6.03, the sole remedy of the Issuer, the Owner Trustee, the Indenture
Trustee, the Noteholders or the Certificateholders with respect to a breach
of representations and warranties pursuant to Section 3.01 and the agreement
contained in this Section shall be to require the Seller to repurchase
Receivables pursuant to this Section, subject to the conditions contained
herein.
SECTION 3.03. Custody of Receivable Files. To assure uniform quality
in servicing the Receivables and to reduce administrative costs, the Issuer
hereby revocably appoints the Servicer, and the Servicer hereby accepts such
appointment, to act for the benefit of the Issuer and the Indenture Trustee
as custodian of the following documents or instruments which are hereby or
will hereby be constructively delivered to the Indenture Trustee, as pledgee
of the Issuer, as of the Closing Date with respect to each Receivable:
(a) the fully executed original of the Standard Receivable
or Fixed Value Receivable;
(b) the original credit application fully executed by the
Obligor;
(c) the original certificate of title or such documents
that the Servicer or the Seller shall keep on file, in accordance
with its customary procedures, evidencing the security interest of
the Seller in the Financed Vehicle; and
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(d) any and all other documents that the Servicer or the
Seller shall keep on file, in accordance with its customary
procedures, relating to a Standard Receivable or Fixed Value
Receivable, an Obligor or a Financed Vehicle.
SECTION 3.04. Duties of Servicer as Custodian. i) Safekeeping. The
Servicer shall hold the Receivable Files as custodian for the benefit of the
Issuer and maintain such accurate and complete accounts, records and computer
systems pertaining to each Receivable File as shall enable the Issuer 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. 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 Issuer or the Indenture Trustee to verify the accuracy of
the Servicer's record keeping. The Servicer shall promptly report to the
Issuer and the Indenture Trustee any failure on its part to hold the
Receivable Files and maintain its accounts, records and computer systems as
herein provided and shall promptly take appropriate action to remedy any such
failure. Nothing herein shall be deemed to require an initial review or any
periodic review by the Issuer or the Indenture 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
or at such other office as shall be specified to the Issuer and the Indenture
Trustee by written notice not later than 90 days after any change in
location. The Servicer shall make available to the Issuer and the Indenture
Trustee or their respective duly authorized representatives, attorneys or
auditors a list of locations of the Receivable Files and the related
accounts, records and computer systems maintained by the Servicer at such
times during normal business hours as the Issuer or the Indenture Trustee
shall instruct.
(c) Release of Documents. Upon instruction from the Indenture
Trustee, the Servicer shall release any Receivable File to the Indenture
Trustee, the Indenture Trustee's agent or the Indenture Trustee's designee,
as the case may be, at such place or places as the Indenture 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 a Trust Officer of
the Indenture Trustee.
SECTION 3.06. Custodian's Indemnification. The Servicer as custodian
shall indemnify the Trust, the Owner Trustee and the Indenture Trustee and
each of their respective officers, directors, employees and agents 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 Trust, the Owner Trustee or the Indenture Trustee or
any of their respective officers, directors, employees and agents as the
result of any improper act or omission in any way relating to the maintenance
and custody by the Servicer as custodian of the
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Receivable Files; provided, however, that the Servicer shall not be liable to
the Owner Trustee for any portion of any such amount resulting from the
willful misfeasance, bad faith or negligence of the Owner Trustee, and the
Servicer shall not be liable to the Indenture Trustee for any portion of any
such amount resulting from the willful misfeasance, bad faith or negligence
of the Indenture Trustee.
SECTION 3.07. Effective Period and Termination. The Servicer's
appointment as custodian shall become effective as of the Cutoff Date and
shall continue in full force and effect until terminated pursuant to this
Section. If CFC shall resign as Servicer in accordance with the provisions of
this Agreement or if all of the rights and obligations of any Servicer shall
have been terminated under Section 8.01, the appointment of such Servicer as
custodian shall be terminated by the Indenture Trustee or by the Holders of
Notes evidencing not less than 25% of the Outstanding Amount of the Notes or,
with the consent of Holders of the Notes evidencing not less than 25% of the
Outstanding Amount of the Notes, by the Owner Trustee, in the same manner as
the Indenture Trustee or such Holders may terminate the rights and
obligations of the Servicer under Section 8.01. The Indenture Trustee or,
with the consent of the Indenture Trustee, the Owner Trustee may terminate
the Servicer's appointment as custodian, with cause, at any time upon written
notification to the Servicer and, without cause, upon 30 days' prior written
notification to the Servicer. As soon as practicable after any termination of
such appointment, the Servicer shall deliver the Receivable Files to the
Indenture Trustee or the Indenture Trustee's agent at such place or places as
the Indenture Trustee may reasonably designate.
ARTICLE IV
Administration and Servicing of Receivables
SECTION 4.01. Duties of Servicer. The Servicer, for the benefit of
the Issuer (to the extent provided herein), shall manage, service, administer
and make collections on the Receivables (other than Purchased Receivables)
with reasonable care, using that degree of skill and attention that the
Servicer exercises with respect to all comparable automotive receivables that
it services for itself or others. The Servicer's duties shall include
collection and posting of all payments, responding to inquiries of Obligors
on such Receivables, investigating delinquencies, sending payment coupons to
Obligors, reporting tax information to Obligors, accounting for collections
and furnishing monthly and annual statements to the Owner Trustee and the
Indenture Trustee with respect to distributions. Subject to the provisions of
Section 4.02, the Servicer shall follow its customary standards, policies and
procedures in performing its duties as Servicer. Without limiting the
generality of the foregoing, the Servicer is authorized and empowered to
execute and deliver, on behalf of itself, the Issuer, the Owner Trustee, the
Indenture Trustee, the Certificateholders and the Noteholders 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
such Receivables or to the Financed Vehicles securing such Receivables. If
the Servicer shall commence a legal proceeding to enforce a Receivable, the
Issuer (in the case of a Receivable other than a Purchased Receivable) shall
thereupon be deemed to have automatically assigned, solely for the purpose of
collection, such Receivable to the
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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 Owner Trustee shall, at the Servicer's expense and direction,
take steps to enforce such Receivable, including bringing suit in its name or
the name of the Owner Trustee, the Indenture Trustee, the Certificateholders
or the Noteholders. The Owner Trustee shall upon the written request of the
Servicer furnish the Servicer with any powers of attorney and other documents
reasonably necessary or appropriate to enable the Servicer to carry out its
servicing and administrative duties hereunder.
SECTION 4.02. Collection and Allocation 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 automotive receivables that it services for itself
or others. The Servicer shall allocate collections between principal and
interest in accordance with the customary servicing procedures it follows
with respect to all comparable automotive receivables that it services for
itself or others. The Servicer may grant extensions, rebates or adjustments
on a Standard Receivable or Fixed Value Receivable, which shall not, for the
purposes of this Agreement, modify the original due dates or amounts of the
originally scheduled payments of interest on such Standard Receivable or
Fixed Value Receivable; provided, however, that if the Servicer extends the
date for final payment by the Obligor of any Receivable beyond the Final
Scheduled Maturity Date, it shall promptly repurchase the Standard Receivable
or Fixed Value Receivable from the Issuer in accordance with the terms of
Section 4.07. 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 Standard Receivable or Fixed Value Receivable. The Servicer shall
not agree to any alteration of the interest rate or the originally scheduled
payments on any Standard Receivable or Fixed Value Receivable.
SECTION 4.03. Realization upon Receivables. On behalf of the Issuer,
the Servicer shall use its best 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 automotive receivables, which may include
reasonable efforts to realize upon any recourse to Dealers and selling the
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
Liquidation Proceeds by an amount greater than the amount of such expenses.
SECTION 4.04. Physical Damage Insurance. The Servicer shall, in
accordance with its customary servicing procedures, require that each Obligor
shall have obtained physical damage insurance covering the Financed Vehicle
as of the execution of the Standard Receivable or Fixed Value Receivable.
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SECTION 4.05. 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 Standard Receivable and Fixed Value
Receivable in the related Financed Vehicle. The Servicer is hereby authorized
to take such steps as are necessary to re-perfect such security interest on
behalf of the Issuer and the Indenture Trustee in the event of the relocation
of a Financed Vehicle or for any other reason.
SECTION 4.06. Covenants of Servicer. 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 the Obligor thereunder or repossession, nor shall the Servicer
impair the rights of the Issuer, the Indenture Trustee, the
Certificateholders or the Noteholders in such Receivable, nor shall the
Servicer increase the number of scheduled payments due under a Standard
Receivable or Fixed Value Receivable.
SECTION 4.07. Purchase of Receivables upon Breach. The Servicer or
the Owner Trustee shall inform the other party and the Indenture Trustee and
the Seller promptly, in writing, upon the discovery of any breach pursuant to
Section 4.02, 4.05 or 4.06. 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 following Collection Period),
the Servicer shall purchase any Receivable materially and adversely affected
by such breach as of such last day. If the Servicer takes any action during
any Collection Period pursuant to Section 4.02 that impairs the rights of the
Issuer, the Indenture Trustee, the Certificateholders or the Noteholders in
any Receivable or as otherwise provided in Section 4.02, the Servicer shall
purchase such Receivable as of the last day of such Collection Period. In
consideration of the purchase of any such Receivable pursuant to either of
the two preceding sentences, the Servicer shall remit the Purchase Amount in
the manner specified in Section 5.05. Subject to Section 7.02, the sole
remedy of the Issuer, the Owner Trustee, the Indenture Trustee, the
Certificateholders or the Noteholders with respect to a breach pursuant to
Section 4.02, 4.05 or 4.06 shall be to require the Servicer to purchase
Receivables pursuant to this Section. The Owner Trustee shall have no duty to
conduct any affirmative investigation as to the occurrence of any condition
requiring the repurchase of any Receivable pursuant to this Section.
SECTION 4.08. Servicing Fee. The Servicing Fee for a Distribution
Date shall equal the product of (a) one-twelfth (or, in the case of the
initial Collection Period, a fraction, the numerator of which is equal to the
number of days elapsed from the Cutoff Date through the last day of such
initial Collection Period and the denominator of which is 360), (b) the
Servicing Fee Rate and (c) the Pool Balance as of the first day of the
preceding Collection Period. The Servicer shall also be entitled to all late
fees, prepayment charges, and other administrative fees or similar charges
allowed by applicable law with respect to the Receivables, collected (from
whatever source) on the Receivables, plus any reimbursement pursuant to the
last paragraph of Section 7.02.
SECTION 4.09. Servicer's Certificate. Not later than 11:00 A.M. (New
York time) on each Payment Determination Date, the Servicer shall deliver to
the Owner Trustee, each Paying Agent, the Indenture Trustee and the Seller,
with a copy to the Rating Agencies, a Servicer's
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Certificate containing all information necessary to make the distributions to
be made on the related Distribution Date pursuant to Sections 5.06 and 5.07
for the related Collection Period. Receivables to be purchased by the
Servicer or to be repurchased by the Seller shall be identified by the
Servicer by account number with respect to such Receivable (as specified in
Schedule A).
SECTION 4.10. Annual Statement as to Compliance; Notice of Default.
i) The Servicer shall deliver to the Owner Trustee and the Indenture Trustee,
on or before April 30 of each year beginning April 30, 1999, an Officers'
Certificate, dated as of December 31 of the preceding year, stating that (i)
a review of the activities of the Servicer during the preceding 12-month
period (or such longer period as shall have elapsed since the Closing Date)
and of its performance under this Agreement has been made under such
officers' supervision and (ii) to the best of such officers' knowledge, based
on such review, the Servicer has fulfilled all its obligations under this
Agreement throughout such year or, if there has been a default in the
fulfillment of any such obligation, specifying each such default known to
such officers and the nature and status thereof. The Indenture Trustee shall
send a copy of such certificate and the report referred to in Section 4.11 to
the Rating Agencies. A copy of such certificate and the report referred to in
Section 4.11 may be obtained by any Certificateholder, Noteholder or Note
Owner by a request in writing to the Owner Trustee addressed to the Corporate
Trust Office. Upon the telephone request of the Owner Trustee, the Indenture
Trustee will promptly furnish the Owner Trustee a list of Noteholders as of
the date specified by the Owner Trustee.
(b) The Servicer shall deliver to the Owner Trustee, the Indenture
Trustee and the Rating Agencies, promptly after having obtained knowledge
thereof, but in no event later than five (5) Business Days thereafter,
written notice in an Officers' Certificate of any event which with the giving
of notice or lapse of time, or both, would become a Servicer Default under
Section 8.01(a) or (b).
SECTION 4.11. Annual Independent Certified Public Accountants'
Report. The Servicer shall cause a firm of independent certified public
accountants, which may also render other services to the Servicer, the Seller
or their Affiliates, to deliver to the Owner Trustee and the Indenture
Trustee on or before April 30 of each year beginning April 30, 1999, a report
addressed to the Board of Directors of the Servicer, to the effect that such
firm has examined the financial statements of CFC and issued its report
thereon and that such examination (a) was made in accordance with generally
accepted auditing standards and accordingly included such tests of the
accounting records and such other auditing procedures as such firm considered
necessary in the circumstances; (b) included tests relating to automotive
loans serviced for others in accordance with the requirements of the Uniform
Single Attestation Program for Mortgage Bankers (the "Program"), to the
extent the procedures in such Program are applicable to the servicing
obligations set forth in this Agreement; and (c) except as described in the
report, disclosed no exceptions or errors in the records relating to
automobile and light-duty truck loans serviced for others that, in the firm's
opinion, paragraph four of such Program requires such firm to report.
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Such report will also indicate that the firm is independent of the
Servicer within the meaning of the Code of Professional Ethics of the
American Institute of Certified Public Accountants.
SECTION 4.12. Access to Certain Documentation and Information
Regarding Receivables. The Servicer shall provide to the Certificateholders
and Noteholders access to the Receivable Files in such cases where the
Certificateholders or Noteholders shall be required by applicable statutes or
regulations to review such documentation. Access shall be afforded without
charge, but only upon reasonable request and during the normal business hours
at the 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 4.13. 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, taxes imposed on
the Servicer and expenses incurred in connection with distributions and
reports to Certificateholders and Noteholders.
SECTION 4.14. Appointment of Subservicer. The Servicer may at any
time appoint a subservicer to perform all or any portion of its obligations
as Servicer hereunder; provided, however, that the Rating Agency Condition
shall have been satisfied in connection therewith; and provided, further,
that the Servicer shall remain obligated and be liable to the Issuer, the
Owner Trustee, the Indenture Trustee, the Certificateholders and the
Noteholders for the servicing and administering of the Receivables in
accordance with the provisions hereof without diminution of such obligation
and liability by virtue of the appointment of such subservicer and to the
same extent and under the same terms and conditions as if the Servicer alone
were servicing and administering the Receivables. The fees and expenses of
the subservicer shall be as agreed between the Servicer and its subservicer
from time to time, and none of the Issuer, the Owner Trustee, the Indenture
Trustee, the Certificateholders or the Noteholders shall have any
responsibility therefor.
ARTICLE V
Distributions; Reserve Account;
Statements to Certificateholders and Noteholders
SECTION 5.01. Establishment of Collection Account. i) The Servicer,
for the benefit of the Noteholders and the Certificateholders, shall
establish and maintain in the name of the Indenture Trustee an Eligible
Deposit Account (the "Collection Account"), bearing a designation clearly
indicating that the funds deposited therein are held for the benefit of the
Noteholders and the Certificateholders. The Servicer shall establish the
Reserve Account as part of the Collection Account.
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(b) Funds on deposit in the Collection Account shall be invested (1)
by the Indenture Trustee in Eligible Investments selected in writing by the
Servicer or an investment manager selected by the Servicer, which investment
manager shall have agreed to comply with the terms of this Agreement as it
relates to investing such funds or (2) by an investment manager in Eligible
Investments selected by such investment manager; provided that (A) such
investment manager shall be selected by the Servicer, (B) such investment
manager shall have agreed to comply with the terms of this Agreement as it
relates to investing such funds, (C) any investment so selected by such
investment manager shall be made in the name of the Indenture Trustee and
shall be settled by a Delivery to the Indenture Trustee that complies with
the terms of this Agreement as it relates to investing such funds, and (D)
prior to the settlement of any investment so selected by such investment
manager the Indenture Trustee shall affirm that such investment is an
Eligible Investment. The Servicer initially appoints the Indenture Trustee
investment manager hereunder, which the Indenture Trustee hereby accepts. It
is understood and agreed that the Indenture Trustee shall not be liable for
any loss arising from an investment in Eligible Investments made in
accordance with this Section 5.01(b). All such Eligible Investments shall be
held by the Indenture Trustee for the benefit of the Noteholders and the
Certificateholders, as applicable; provided, that on each Payment
Determination Date all interest and other investment income (net of losses
and investment expenses) on funds on deposit in the Collection Account shall
be deemed to constitute a portion of the Interest Distribution Amount for the
related Distribution Date. Other than as permitted by the Rating Agencies,
funds on deposit in the Collection Account shall be invested in Eligible
Investments that will mature (1) not later than the Business Day immediately
preceding the next Distribution Date or (2) on such next Distribution Date if
either (x) such investment is held in the corporate trust department of the
institution with which the Collection Account is then maintained and is
invested either in a time deposit of the Indenture Trustee rated at least A-1
by Standard & Poor's and P-1 by Moody's (such account being maintained within
the corporate trust department of the Indenture Trustee) or in the Indenture
Trustee's common trust fund so long as such fund is rated in the highest
applicable rating category by Standard & Poor's and Moody's or (y) the
Indenture Trustee (so long as the short-term unsecured debt obligations of
the Indenture Trustee are either (i) rated at least P-1 by Moody's and A-1 by
Standard & Poor's on the date such investment is made or (ii) guaranteed by
an entity whose short-term unsecured debt obligations are rated at least P-1
by Moody's and A-1 by Standard & Poor's on the date such investment is made)
has agreed to advance funds on such Distribution Date in the amount payable
on such investment on such Distribution Date pending receipt thereof to the
extent necessary to make distributions on such Distribution Date. The
guarantee referred to in clause (y) of the preceding sentence shall be
subject to the Rating Agency Condition. For the purpose of the foregoing,
unless the Indenture Trustee affirmatively agrees in writing to make such
advance with respect to such investment prior to the time an investment is
made, it shall not be deemed to have agreed to make such advance. Funds
deposited in the Collection Account on a day which immediately precedes a
Distribution Date upon the maturity of any Eligible Investments are not
required to be invested overnight.
(c) (1) The Indenture Trustee shall possess all right, title and
interest in all funds on deposit from time to time in the Collection Account
and in all proceeds thereof (including all
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income thereon) and all such funds, investments, proceeds and income shall be
part of the Trust Estate. The Collection Account shall be under the sole
dominion and control of the Indenture Trustee for the benefit of the
Noteholders and the Certificateholders, as applicable. If, at any time, the
Collection Account ceases to be an Eligible Deposit Account, the Indenture
Trustee (or the Servicer on its behalf) shall within 10 Business Days (or
such longer period, not to exceed 30 calendar days, as to which each Rating
Agency may consent) establish a new Collection Account as an Eligible Deposit
Account and shall transfer any cash and/or any investments to such new
Collection Account.
(ii) With respect to the Trust Account Property, the
Indenture Trustee agrees, by its acceptance hereof, that:
(A) any Trust Account Property that is held in
deposit accounts shall be held solely in the Eligible
Deposit Accounts, subject to the last sentence of Section
5.01(c)(i); and each such Eligible Deposit Account shall be
subject to the exclusive custody and control of the
Indenture Trustee, and the Indenture Trustee shall have
sole signature authority with respect thereto;
(B) any Trust Account Property that constitutes
Physical Property shall be delivered to the Indenture
Trustee in accordance with paragraph (a) of the definition
of "Delivery" and shall be held, pending maturity or
disposition, solely by the Indenture Trustee or a
securities intermediary (as such term is defined in Section
8-102 of the UCC) acting solely for the Indenture Trustee;
(C) any Trust Account Property that is a
book-entry security held through the Federal Reserve System
pursuant to federal book-entry regulations shall be
delivered in accordance with paragraph (b) of the
definition of "Delivery" and shall be maintained by the
Indenture Trustee, pending maturity or disposition, through
continued book-entry registration of such Trust Account
Property as described in such paragraph; and
(D) any Trust Account Property that is an
"uncertificated security" under Article VIII of the UCC and
that is not governed by clause (C) above shall be delivered
to the Indenture Trustee in accordance with paragraph (c)
of the definition of "Delivery" and shall be maintained by
the Indenture Trustee, pending maturity or disposition,
through continued registration of the Indenture Trustee's
(or its nominee's) ownership of such security.
(iii) The Servicer shall have the power, revocable by
the Indenture Trustee or by the Owner Trustee with the consent of
the Indenture Trustee, to instruct the Indenture Trustee to make
withdrawals and payments from the Collection Account for the purpose
of permitting the Servicer to carry out its respective duties
hereunder or permitting the Indenture Trustee to carry out its
duties under the Indenture.
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SECTION 5.02. Collections. Subject to the continued satisfaction of
the commingling conditions described below, the Servicer shall remit to the
Collection Account all payments by or on behalf of the Obligors with respect
to the Receivables (other than Purchased Receivables and not including Fixed
Value Payments), all Liquidation Proceeds and any subsequent Recoveries, both
as collected during a Collection Period, on or prior to the Payment
Determination Date preceding the related Distribution Date. Notwithstanding
the foregoing, if any of the commingling conditions ceases to be met, the
Servicer shall remit to the Collection Account all payments by or on behalf
of the Obligors with respect to the Receivables (other than Purchased
Receivables and not including Fixed Value Payments), all Liquidation Proceeds
and any subsequent Recoveries within two Business Days of receipt thereof.
The commingling conditions are as follows: (i) CFC must be the Servicer, (ii)
no Servicer Default shall have occurred and be continuing and (iii) (x) CFC
must maintain a short-term rating of at least A-1 by Standard & Poor's and
P-1 by Moody's or (y) if daily remittances occur hereunder, prior to ceasing
daily remittances, the Rating Agency Condition shall have been satisfied (and
any conditions or limitations imposed by the Rating Agencies in connection
therewith are complied with). Notwithstanding anything herein to the
contrary, so long as CFC is the Servicer, CFC may withhold from the deposit
into the Collection Account any amounts indicated on the related Servicer's
Certificate as being due and payable to CFC or the Seller and pay such
amounts directly to CFC or the Seller, as applicable. For purposes of this
Article V, the phrase "payments by or on behalf of Obligors" shall mean
payments made with respect to the Receivables by Persons other than the
Servicer or the Seller. In the event the commingling conditions cease to be
met, the Servicer shall make daily remittance of collections to the
Collection Account within two Business Days of receipt thereof; provided
however, daily remittance may commence no later than five Business Days
following a reduction of CFC's short-term ratings below A-1 by Standard &
Poor's or P-1 by Moody's.
SECTION 5.03. Application of Collections. i) All collections for the
Collection Period shall be applied by the Servicer as follows:
With respect to each Receivable (other than a Purchased
Receivable), payments by or on behalf of the Obligor shall be
applied to interest and principal in accordance with the Simple
Interest Method.
(b) All collections of finance charges on a Fixed Value Receivable
(as determined in accordance with the Servicer's customary procedures) shall
be applied, first, to the Amortizing Payment Finance Charges due and unpaid
on the related Principal Balance and then to the Fixed Value Finance Charges
due and unpaid on the related Fixed Value Payment. The Servicer shall release
to the Company the Collections allocated to Fixed Value Finance Charges
pursuant to the preceding sentence. All Liquidation Proceeds and any
subsequent Recoveries with respect to any Fixed Value Receivable shall be
applied first to the related Receivable and only after the payment in full of
the Principal Balance thereof plus accrued but unpaid interest thereon shall
any such Liquidation Proceeds or Recoveries be applied to, or constitute, the
related Fixed Value Payment.
SECTION 5.04. [ Reserved ]
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SECTION 5.05. Additional Deposits. The Servicer and the Seller shall
deposit or cause to be deposited in the Collection Account the aggregate
Purchase Amount with respect to Purchased Receivables and the Servicer shall
deposit therein all amounts to be paid under Section 9.01. The Servicer will
deposit the aggregate Purchase Amount with respect to Purchased Receivables
when such obligations are due, unless the Servicer shall not be required to
make daily deposits pursuant to Section 5.02. All such other deposits shall
be made on the Payment Determination Date for the related Collection Period.
SECTION 5.06. Distributions.
(a) (1) On each Payment Determination Date, the Servicer shall
calculate all amounts required to be distributed to the Noteholders and the
Certificateholders and all amounts to be allocated within the Collection
Account as described below. For purposes of this Section, the Servicing Fee
for the related Distribution Date and any previously unpaid Servicing Fees
shall, and the Cash Release Amount to be distributed to the Holders of the
Trust Certificates may, be deducted from the Total Distribution Amount at any
time on or prior to the Distribution Date.
(ii) On each Distribution Date, the Servicer shall
instruct the Indenture Trustee (based on the information contained
in the Servicer's Certificate delivered on the related Payment
Determination Date pursuant to Section 4.09) to make the following
allocations and distributions by 11:00 A.M. (New York time), to the
extent of the Total Distribution Amount (net of the Servicing Fee
for such Distribution Date and any previously unpaid Servicing Fees
and any Cash Release Amount deducted pursuant to Section
5.06(a)(i)), in the following order of priority:
(A) allocate to the Noteholders for distribution
pursuant to Section 8.02 of the Indenture, from the Total
Distribution Amount, the Noteholders' Interest
Distributable Amount;
(B) allocate to the Noteholders for distribution
pursuant to Section 8.02 of the Indenture, from the Total
Distribution Amount remaining after the application of
clause (A), the Noteholders' Principal Distributable
Amount; provided, however, that on each Distribution Date
during the Release Period, the Release Period Noteholder's
Principal Distributable Amount (rather than the
Noteholders' Principal Distributable Amount) shall be
allocated to the Noteholders for distribution to the
Noteholders pursuant to Section 8.02 of the Indenture;
(C) allocate to the Reserve Account, from the
Total Distribution Amount remaining after the application
of clauses (A) and (B) (it being understood that the
Accelerated Principal Distribution Amount and the Cash
Release Amount are a function of and subject to the amount
required to be allocated to the Reserve Account pursuant to
this clause (C)), the excess, if any, of the Specified
Reserve Amount over the amount then allocated to the
Reserve Account;
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(D) if all of the conditions set forth in Section
5.06(b) are satisfied, distribute to the Holders of the
Trust Certificates, from the Total Distribution Amount
remaining after the application of clauses (A) through (C),
the Cash Release Amount for such Distribution Date to the
extent not already deducted pursuant to Section 5.06(a)(i);
(E) distribute to the Holders of the
Overcollateralization Certificates, the Total Distribution
Amount remaining after the application of clauses (A)
through (D) and only after the Notes have been paid in
full, until the Certificate Balance has been reduced to
zero; and
(F) distribute to the Holders of the Trust
Certificates the portion, if any, of the Total Distribution
Amount remaining after the application of clauses (A)
through (E).
If pursuant to Section 5.02, the Servicer is permitted to remit collections
on the Receivables to the Collection Account on the Payment Determination
Date preceding the related Distribution Date, then the Servicer may net the
amounts, if any, distributable pursuant to clauses (D), (E) and (F) out of
the Total Distribution Amount before depositing the Total Distribution Amount
into the Collection Account and pay such amounts directly to the related
recipient.
Notwithstanding that the Notes have been paid in full, the Indenture
Trustee shall continue to maintain the Collection Account hereunder until the
Pool Balance is reduced to zero.
(b) The distribution of a Cash Release Amount pursuant to Section
5.06(a)(ii)(D) on a Distribution Date shall be subject to the satisfaction of
all of the following conditions:
(i) no such distribution or release shall be made until
the First Release Distribution Date; and
(ii) the amount allocated to the Reserve Account is equal
to the Specified Reserve Amount and the aggregate amount of Cash
Release Amounts distributed pursuant to Section 5.06(a)(ii)(D) on or
prior to such Distribution Date shall not exceed the Initial
Overcollateralization Amount.
SECTION 5.07. Reserve Account. i) On the Closing Date, the Owner
Trustee will deposit, on behalf of the Seller, the Reserve Account Initial
Deposit into the Collection Account from the net proceeds of the sale of the
Notes which amount shall be allocated to the Reserve Account.
(b) (1) After giving effect to clause (ii) below, if the amount
allocated to the Reserve Account on any Distribution Date (after giving
effect to all allocations thereto or withdrawals therefrom on such
Distribution Date) is greater than the Specified Reserve Amount, the Servicer
shall instruct the Indenture Trustee to distribute the amount of such excess
to the Seller.
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(ii) On each Distribution Date subsequent to any
reduction or withdrawal by any Rating Agency of its rating of any
Class of Notes, unless such rating has been restored, if the amount
allocated to the Reserve Account (after taking into account any
allocations thereto pursuant to Section 5.06(a) and withdrawals
therefrom pursuant to Section 5.07(c) or (d) on such date) is
greater than the Specified Reserve Amount, then the Servicer shall
instruct the Indenture Trustee to include the amount of such excess
in the Noteholders' Monthly Principal Distribution Amount and to
allocate the amount of such excess for distribution to Noteholders
as an accelerated payment of principal on such Distribution Date;
provided, that the amount of such deposit shall not exceed the
outstanding principal balance of the Notes after giving effect to
all other payments of principal to be made on such date.
(c) (1) In the event that the Noteholders' Distributable Amount for
a Distribution Date exceeds the sum of the amounts allocated for distribution
to the Noteholders pursuant to Section 5.06(a)(ii)(A) and (B) on such
Distribution Date, the Servicer shall instruct the Indenture Trustee to
withdraw from the Reserve Account on such Distribution Date an amount equal
to such excess, to the extent of funds available therein, and allocate such
amount for distribution to the Noteholders; provided that such amount shall
be applied first, to the payment of interest due on the Notes to the extent,
if any, that the amount allocated pursuant to Section 5.06(a)(ii)(A) is not
sufficient to cover such payment of interest; and second, to the payment of
principal of the Notes.
(ii) In the event that the Noteholders' Principal
Distributable Amount on the Class A-1 Final Scheduled Distribution
Date, the Class A-2 Final Scheduled Distribution Date, the Class A-3
Final Scheduled Distribution Date or the Class A-4 Final Scheduled
Distribution Date exceeds the amount allocated for distribution to
the Noteholders pursuant to Section 5.06(a)(ii)(B) on such
Distribution Date, the Servicer shall instruct the Indenture Trustee
to withdraw from the Reserve Account on such Distribution Date an
amount equal to such excess, to the extent of funds available
therein, and allocate such amount for distribution to the
Noteholders.
(d) Subject to Section 9.01, amounts will continue to be applied
pursuant to Section 5.06(a) following payment in full of both the Outstanding
Amount of the Notes and of the Certificate Balance of the
Overcollateralization Certificates until the Pool Balance is reduced to zero.
Following the payment in full of the aggregate Outstanding Amount of the
Notes and of the Certificate Balance of the Overcollateralization
Certificates and of all other amounts owing or to be distributed hereunder or
under the Indenture or the Trust Agreement to Noteholders and the termination
of the Trust, any amount then allocated to the Reserve Account shall be
distributed to the Seller.
SECTION 5.08. [ Reserved ]
SECTION 5.09. Statements to Noteholders and Certificateholders. On
each Distribution Date, the Servicer shall provide to the Owner Trustee (with
a copy to the Rating Agencies and each Paying Agent) for the Owner Trustee to
forward to each Certificateholder of record as of the most recent Record Date
and to the Indenture Trustee (with a copy to each Paying Agent) for the
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Indenture Trustee to forward to each Noteholder of record as of the most
recent Record Date a statement substantially in the form of Exhibit B,
setting forth at least the following information as to the Notes, to the
extent applicable:
(i) the amount of such distribution allocable to
principal allocable to each Class of Notes;
(ii) the amount of such distribution allocable to
interest allocable to each Class of Notes;
(iii) the outstanding principal balance of each Class of
Notes and the Note Pool Factor for each such Class as of the close
of business on the last day of the preceding Collection Period,
after giving effect to payments allocated to principal reported
under clause (i) above;
(iv) the amount of the Servicing Fee paid to the
Servicer with respect to the related Collection Period;
(v) the amount of Realized Losses, if any, with respect
to the related Collection Period;
(vi) the amount allocated to the Reserve Account on such
Payment Determination Date after giving effect to allocations
thereto and withdrawals therefrom to be made on the next following
Distribution Date, if any;
(vii) the Pool Balance as of the close of business on
the last day of the related Collection Period, after giving effect
to payments allocated to principal reported under clause (i) above;
and
(viii) the amount, if any, allocated for distribution to
the Certificateholders.
Each amount set forth on the Distribution Date statement under
clauses (i), (ii) or (iv) above shall be expressed as a dollar amount per
$1,000 of original principal balance of a Note.
SECTION 5.10. Net Deposits. As an administrative convenience, unless
the Servicer is required to remit collections daily, the Servicer will be
permitted to make the deposit of collections on the Receivables and Purchase
Amounts for or with respect to the Collection Period net of distributions to
be made to the Servicer with respect to the Collection Period. The Servicer,
however, will account to the Owner Trustee, the Indenture Trustee, the
Noteholders and the Certificateholders as if all deposits, distributions and
transfers were made individually.
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ARTICLE VI
The Seller
SECTION 6.01. Representations of Seller. The Seller makes the
following representations on which the Issuer is deemed to have relied in
acquiring the Receivables. The representations speak as of the execution and
delivery of this Agreement and as of the Closing Date, and shall survive the
sale of the Receivables to the Issuer and the pledge thereof to the Indenture
Trustee pursuant to the Indenture.
(a) Organization and Good Standing. The Seller is duly
organized and validly existing as a corporation in good standing
under the laws of the State of Michigan, with the 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, the corporate
power, authority and legal right to acquire and own the Standard
Receivables and the Fixed Value Receivables.
(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 jurisdictions in which
the ownership or lease of property or the conduct of its business
shall require such qualifications.
(c) Power and Authority. The Seller has the corporate power
and authority to execute and deliver this Agreement and to carry out
their respective terms; the Seller has full power and authority to
sell and assign the property to be sold and assigned to and
deposited with the Issuer, and the Seller shall have duly authorized
such sale and assignment to the Issuer 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) Binding Obligation. This Agreement constitutes a legal,
valid and binding obligation of the Seller enforceable in accordance
with its terms.
(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, or constitute (with or without notice or
lapse of time) a default under, the articles of incorporation or
bylaws of the Seller, or any indenture, agreement or other
instrument to which the Seller is a party or by which it is bound;
or result in the creation or imposition of any Lien upon any of its
properties pursuant to the terms of any such indenture, agreement or
other instrument (other than pursuant to this Agreement and the
Basic Documents); or violate any law or, to the best of the Seller's
knowledge, any order, rule or regulation applicable to the Seller of
any court or of any federal or state regulatory body, administrative
agency or other governmental instrumentality having jurisdiction
over the Seller or its properties.
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(f) No Proceedings. To the Seller's best knowledge, there
are no proceedings or investigations pending or 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
Indenture or any of the other Basic Documents, the Notes or the
Certificates, (ii) seeking to prevent the issuance of the Notes or
the Certificates or the consummation of any of the transactions
contemplated by this Agreement, the Indenture or any of the other
Basic Documents, (iii) seeking any determination or ruling that
might materially and adversely affect the performance by the Seller
of its obligations under, or the validity or enforceability of, this
Agreement, the Indenture, any of the other Basic Documents, the
Notes or the Certificates or (iv) which might adversely affect the
federal or state income tax attributes of the Notes or the
Certificates.
SECTION 6.02. Corporate Existence. During the term of this
Agreement, the Seller will keep in full force and effect its existence,
rights and franchises as a corporation (or another legal entity) under the
laws of the jurisdiction of its organization and will obtain and preserve its
qualification to do business in each jurisdiction in which such qualification
is or shall be necessary to protect the validity and enforceability of this
Agreement, the Basic Documents and each other instrument or agreement
necessary or appropriate to the proper administration of this Agreement and
the transactions contemplated hereby. In addition, all transactions and
dealings between the Seller and its Affiliates (including the Company) will
be conducted on an arm's-length basis.
SECTION 6.03. 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:
(a) The Seller shall indemnify, defend and hold harmless
the Issuer, the Owner Trustee, the Indenture Trustee, the Company
and the Servicer and any of the officers, directors, employees and
agents of the Issuer, the Owner Trustee and the Indenture Trustee
from and against any taxes that may at any time be asserted against
any such Person with respect to the transactions contemplated herein
and in the Basic Documents, including any sales, gross receipts,
general corporation, tangible personal property, privilege or
license taxes (but, in the case of the Issuer, not including any
taxes asserted with respect to, and as of the date of, the sale of
the Receivables to the Issuer or the issuance and original sale of
the Certificates and the Notes, or asserted with respect to
ownership of the Receivables, or federal or other income taxes
arising out of distributions on the Certificates or the Notes) and
costs and expenses in defending against the same.
(b) The Seller shall indemnify, defend and hold harmless
the Issuer, the Owner Trustee, the Indenture Trustee, the Company,
the Certificateholders and the Noteholders and any of the officers,
directors, employees and agents of the Issuer, the Owner Trustee and
the Indenture 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
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and duties under this Agreement and (ii) the Seller's or the
Issuer's violation of federal or state securities laws in connection
with the offering and sale of the Notes and the Certificates.
(c) The Seller shall indemnify, defend and hold harmless
the Owner Trustee and the Indenture Trustee and their respective
officers, directors, employees and agents from and against all
costs, expenses, losses, claims, damages and liabilities arising out
of or incurred in connection with the acceptance or performance of
the trusts and duties herein and in the Trust Agreement contained,
in the case of the Owner Trustee, and in the Indenture contained, in
the case of the Indenture Trustee, except to the extent that such
cost, expense, loss, claim, damage or liability: (i) in the case of
the Owner Trustee, shall be due to the willful misfeasance, bad
faith or negligence (except for errors in judgment) of the Owner
Trustee or, in the case of the Indenture Trustee, shall be due to
the willful misfeasance, bad faith or negligence (except for errors
in judgment) of the Indenture Trustee; or (ii) in the case of the
Owner Trustee, shall arise from the breach by the Owner Trustee of
any of its representations or warranties set forth in Section 7.03
of the Trust Agreement.
(d) The Seller shall pay any and all taxes levied or
assessed upon all or any part of the Owner Trust Estate.
Indemnification under this Section shall survive the resignation or
removal of the Owner Trustee or the Indenture Trustee and 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 payments
pursuant to this Section and the Person to or on behalf of whom such payments
are made thereafter shall collect any of such amounts from others, such
Person shall promptly repay such amounts to the Seller, without interest.
SECTION 6.04. Merger or Consolidation of, or Assumption of
Obligations of, Seller. Any Person (a) into which the Seller may be merged or
consolidated, (b) which may result from any merger or consolidation to which
the Seller shall be a party or (c) which may succeed to the properties and
assets of the Seller substantially as a whole, which Person in any of the
foregoing cases executes an agreement of assumption to perform every
obligation of the Seller under this Agreement, shall be the successor to the
Seller hereunder without the execution or filing of any document or any
further act by any of the parties to this Agreement; 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
Servicer Default, and no event that, after notice or lapse of time, or both,
would become a Servicer Default shall have occurred and be continuing, (ii)
the Seller shall have delivered to the Owner Trustee and the Indenture
Trustee an Officers' Certificate and an Opinion of Counsel each stating that
such consolidation, merger or succession and such agreement of assumption
comply with this Section and that all conditions precedent, if any, provided
for in this Agreement relating to such transaction have been complied with,
(iii) the Rating Agency Condition shall have been satisfied with respect to
such transaction and (iv) the Seller shall have delivered to the Owner
Trustee and the Indenture Trustee an Opinion of Counsel either (A) stating
that, in the opinion of such counsel, all financing
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statements and continuation statements and amendments thereto have been
executed and filed that are necessary fully to preserve and protect the
interest of the Owner Trustee and Indenture Trustee, respectively, 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 interests. Notwithstanding anything herein to the contrary,
the execution of the foregoing agreement of assumption and compliance with
clauses (i), (ii), (iii) and (iv) above shall be conditions to the
consummation of the transactions referred to in clauses (a) , (b) or (c)
above.
SECTION 6.05. Limitation on Liability of Seller and Others. The
Seller and any director, officer, employee or agent of the Seller may rely in
good faith on the advice of counsel or on any document of any kind, prima
facie properly executed and submitted by any Person respecting any matters
arising hereunder. The Seller shall not be under any obligation to appear in,
prosecute or defend any legal action that shall not be incidental to its
obligations under this Agreement, and that in its opinion may involve it in
any expense or liability.
SECTION 6.06. Seller May Own Notes. The Seller and any Affiliate
thereof may in its individual or any other capacity become the owner or
pledgee of Notes with the same rights as it would have if it were not the
Seller or an Affiliate thereof, except as expressly provided herein or in any
Basic Document. The Seller shall not own any Certificates unless the Rating
Agency Condition is satisfied.
ARTICLE VII
The Servicer
SECTION 7.01. Representations of Servicer. The Servicer makes the
following representations on which the Issuer is deemed to have relied in
acquiring the Receivables. The representations speak as of the execution and
delivery of this Agreement and as of the Closing Date, and shall survive the
sale of the Receivables to the Issuer and the pledge thereof to the Indenture
Trustee pursuant to the Indenture.
(a) Organization and Good Standing. The Servicer is duly
organized and validly existing as a corporation in good standing
under the laws of the state of its incorporation, with the 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, the
corporate power, authority and legal right to acquire, own, sell and
service the Standard Receivables and the Fixed Value Receivables and
to hold the Receivable Files as custodian.
(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
(including the servicing of the Standard Receivables and the Fixed
Value Receivables as required by this Agreement) shall require such
qualifications.
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(c) Power and Authority. The Servicer has the corporate
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.
(e) No Violation. The consummation of the transactions
contemplated by this Agreement and the fulfillment of the terms
hereof shall not conflict with, result in any breach of any of the
terms and provisions of, or constitute (with or without notice or
lapse of time) a default under, the articles of incorporation or
bylaws of the Servicer, or any indenture, agreement or other
instrument to which the Servicer is a party or by which it is bound;
or result in the creation or imposition of any Lien upon any of its
properties pursuant to the terms of any such indenture, agreement or
other instrument (other than this Agreement); or violate any law or,
to the best of the Servicer's knowledge, 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.
(f) No Proceedings. To the Servicer's best knowledge, there
are no proceedings or investigations pending or 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,
the Indenture, any of the other Basic Documents, the Notes or the
Certificates, (ii) seeking to prevent the issuance of the Notes or
the Certificates or the consummation of any of the transactions
contemplated by this Agreement, the Indenture or any of the other
Basic Documents, (iii) seeking any determination or ruling that
might materially and adversely affect the performance by the
Servicer of its obligations under, or the validity or enforceability
of, this Agreement, the Indenture, any of the other Basic Documents,
the Notes or the Certificates or (iv) relating to the Servicer and
which might adversely affect the federal or state income tax
attributes of the Notes or the Certificates.
(g) No Insolvent Obligors. As of the related Cutoff Date,
no Obligor on a Standard Receivable or Fixed Value Receivable is
shown on the Receivable Files as the subject of a bankruptcy
proceeding.
SECTION 7.02. 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 indemnify, defend and hold harmless
the Issuer, the Owner Trustee, the Indenture Trustee, the
Noteholders, the Certificateholders, the Company and the Seller and
any of the officers, directors, employees and agents of the Issuer,
the Owner Trustee and the Indenture Trustee from and against any and
all costs, expenses,
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losses, damages, claims and liabilities arising out of or resulting
from the use, ownership or operation by the Servicer or any
Affiliate thereof of a Financed Vehicle.
(b) The Servicer shall indemnify, defend and hold harmless
the Issuer, the Owner Trustee, the Indenture Trustee, the Seller,
the Company, the Certificateholders and the Noteholders and any of
the officers, directors, employees and agents of the Issuer, the
Owner Trustee and the Indenture Trustee from and against any and all
costs, expenses, losses, claims, damages and liabilities to the
extent that such cost, expense, loss, claim, damage or liability
arose out of, or was imposed upon any such Person 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.
For purposes of this Section, in the event of the termination of the
rights and obligations of CFC (or any successor thereto pursuant to Section
7.03) as Servicer pursuant to Section 8.01, or a resignation by such Servicer
pursuant to this Agreement, such Servicer shall be deemed to be the Servicer
pending appointment of a successor Servicer (other than the Indenture
Trustee) pursuant to Section 8.02.
Indemnification under this Section shall survive the resignation or
removal of the Owner Trustee or the Indenture Trustee or 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 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.
SECTION 7.03. Merger or Consolidation of, or Assumption of
Obligations of, Servicer. Any Person (a) into which the Servicer may be
merged or consolidated, (b) which may result from any merger or consolidation
to which the Servicer shall be a party, (c) which may succeed to the
properties and assets of the Servicer substantially as a whole or (d) with
respect to the Servicer's obligations hereunder, which is a legal entity 50%
or more of the voting power of which is owned, directly or indirectly, by
Chrysler Corporation or an affiliate of or successor to Chrysler Corporation
or an affiliate of such successor, which Person executed an agreement of
assumption to perform every obligation of the Servicer hereunder, shall be
the successor to the Servicer under this Agreement without 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 Servicer Default and
no event which, after notice or lapse of time, or both, would become a
Servicer Default shall have occurred and be continuing, (ii) the Servicer
shall have delivered to the Owner Trustee and the Indenture Trustee an
Officers' Certificate and an Opinion of Counsel each stating that such
consolidation, merger or succession and such agreement of assumption comply
with this Section and that all conditions precedent provided for in this
Agreement relating to such transaction have been complied with, (iii) the
Rating Agency Condition shall have been satisfied with respect to such
transaction, (iv) immediately after giving effect to such transaction, the
successor to the Servicer shall become the Administrator under the
Administration Agreement in accordance with Section 8 of such Agreement and
(v) the Servicer
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shall have delivered to the Owner Trustee and the Indenture Trustee an
Opinion of Counsel stating that, in the opinion of such counsel, either (A)
all financing statements and continuation statements and amendments thereto
have been executed and filed that are necessary fully to preserve and protect
the interest of the Owner Trustee and the Indenture Trustee, respectively, in
the Receivables and reciting the details of such filings or (B) no such
action shall be necessary to preserve and protect such interests.
Notwithstanding anything herein to the contrary, the execution of the
foregoing agreement of assumption and compliance with clauses (i), (ii),
(iii), (iv) and (v) above shall be conditions to the consummation of the
transactions referred to in clause (a), (b) or (c) above.
SECTION 7.04. Limitation on Liability of Servicer and Others.
Neither the Servicer nor any of the directors, officers, employees or agents
of the Servicer shall be under any liability to the Issuer, the Noteholders
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 any
document of any kind prima facie properly executed and submitted by any
person respecting any matters arising under this Agreement.
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 involve it in any
expense or liability; provided, however, that the Servicer may undertake any
reasonable action that it may deem necessary or desirable in respect of this
Agreement and the Basic Documents and the rights and duties of the parties to
this Agreement and the Basic Documents and the interests of the
Certificateholders under this Agreement and the Noteholders under the
Indenture.
SECTION 7.05. CFC Not To Resign as Servicer. Subject to the
provisions of Section 7.03, CFC shall not resign from the obligations and
duties hereby imposed on it as Servicer under this Agreement except upon a
determination that the performance of its duties under this Agreement shall
no longer be permissible under applicable law and cannot be cured. Notice of
any such determination permitting the resignation of CFC shall be
communicated to the Owner Trustee and the Indenture 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 Owner Trustee and the Indenture Trustee concurrently with or
promptly after such notice. No such resignation shall become effective until
the Indenture Trustee or a successor Servicer shall (i) have assumed the
responsibilities and obligations of CFC in accordance with Section 8.02 and
(ii) have become the Administrator under the Administration Agreement in
accordance with Section 8 of such Agreement.
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ARTICLE VIII
Default
SECTION 8.01. Servicer Default. If any one of the following events
(a "Servicer Default") shall occur and be continuing:
(a) any failure by the Servicer to deposit in the
Collection Account any required payment or to direct the Indenture
Trustee to make any required distributions therefrom, which failure
continues unremedied for a period of five Business Days after
written notice of such failure is received by the Servicer from the
Owner Trustee or the Indenture Trustee or after discovery of such
failure by an officer of the Servicer; or
(b) failure by the Servicer or the Seller, as the case may
be, duly to observe or to perform in any material respect any other
covenants or agreements of the Servicer or the Seller (as the case
may be) set forth in this Agreement or any other Basic Document,
which failure shall (i) materially and adversely affect the rights
of Certificateholders or Noteholders and (ii) continue unremedied
for a period of 60 days after the date on which written notice of
such failure, requiring the same to be remedied, shall have been
given (A) to the Servicer or the Seller (as the case may be) by the
Owner Trustee or the Indenture Trustee or (B) to the Servicer or the
Seller (as the case may be), and to the Owner Trustee and the
Indenture Trustee by the Holders of Notes, Trust Certificates or
Overcollateralization Certificates, as applicable, evidencing not
less than 25% of the Outstanding Amount of the Notes, evidencing
Percentage Interests (as defined in the Trust Agreement) aggregating
at least 25% or evidencing not less than 25% of the Certificate
Balance; or
(c) the occurrence of an Insolvency Event with respect to
the Seller, the Servicer or the Company;
then, and in each and every case, so long as the Servicer Default shall not
have been remedied, either the Indenture Trustee or the Holders of Notes
evidencing not less than 25% of the Outstanding Amount of the Notes, by
notice then given in writing to the Servicer (and to the Indenture Trustee
and the Owner Trustee if given by the Noteholders) may terminate all the
rights and obligations (other than the obligations set forth in Section 7.02
hereof) 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 Notes, the Certificates or
the Receivables or otherwise, shall, without further action, pass to and be
vested in the Indenture Trustee or such successor Servicer as may be
appointed under Section 8.02; and, without limitation, the Indenture Trustee
and the Owner Trustee are 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. The
predecessor Servicer shall cooperate with the successor Servicer, the
Indenture Trustee and
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the Owner Trustee in effecting the termination of the responsibilities and
rights of the predecessor Servicer under this Agreement, including the
transfer to the successor Servicer for administration by it of all cash
amounts that shall at the time be held by the predecessor Servicer for
deposit, or shall thereafter be received by it with respect to any
Receivable. 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 shall be paid by the predecessor Servicer
upon presentation of reasonable documentation of such costs and expenses.
Upon receipt of notice of the occurrence of a Servicer Default, the Owner
Trustee shall give notice thereof to the Rating Agencies.
SECTION 8.02. Appointment of Successor. i) Upon the Servicer's
receipt of notice of termination pursuant to Section 8.01 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 specified in a notice of
termination, until receipt of such notice and, in the case of resignation,
until the later of (i) the date 45 days from the delivery to the Owner
Trustee and the Indenture 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 termination
hereunder, the Indenture Trustee shall appoint a successor Servicer, and the
successor Servicer shall accept its appointment (including its appointment as
Administrator under the Administration Agreement as set forth in Section
8.02(b)) by a written assumption in form acceptable to the Owner Trustee and
the Indenture Trustee. In the event that 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, the Indenture Trustee without
further action shall automatically be appointed the successor Servicer and
the Indenture Trustee shall be entitled to the Servicing Fee. Notwithstanding
the above, the Indenture Trustee shall, if it shall be legally unable so to
act, appoint or 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 automotive receivables,
as the successor to the Servicer under this Agreement.
(b) Upon appointment, the successor Servicer (including the
Indenture Trustee acting as successor Servicer) shall (i) 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 and shall be entitled to the Servicing Fee
and all the rights granted to the predecessor Servicer by the terms and
provisions of this Agreement and (ii) become the Administrator under the
Administration Agreement in accordance with Section 8 of such Agreement.
(c) The Servicer may not resign unless it is prohibited from serving
as such by law.
SECTION 8.03. Notification to Noteholders and Certificateholders.
Upon any termination of, or appointment of a successor to, the Servicer
pursuant to this Article VIII, the
45
<PAGE>
Owner Trustee shall give prompt written notice thereof to Certificateholders,
and the Indenture Trustee shall give prompt written notice thereof to
Noteholders and the Rating Agencies.
SECTION 8.04. Waiver of Past Defaults. The Holders of Notes
evidencing not less than a majority of the Outstanding Amount of the Notes,
the Holders (as defined in the Trust Agreement) of Trust Certificates
evidencing not less than a majority of the Percentage Interests (as defined
in the Trust Agreement) or the Holders (as defined in the Trust Agreement) of
Overcollateralization Certificates evidencing not less than a majority of the
Certificate Balance may, on behalf of all Noteholders, the Holders of the
Trust Certificates or the Holders of the Overcollateralization Certificates,
as the case may be, waive in writing any default by the Servicer in the
performance of its obligations hereunder and its consequences, except a
default in making any required allocations or distributions from the
Collection Account in accordance with this Agreement. Upon any such waiver of
a past default, such default shall cease to exist, and any Servicer 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 thereto.
ARTICLE IX
Termination
SECTION 9.01. Optional Purchase of All Receivables. i) As of the
last day of any Collection Period immediately preceding a Distribution Date
as of which the then outstanding Pool Balance is 10% or less of the Original
Pool Balance and the Class A-1 Notes, Class A-2 Notes and Class A-3 Notes
have been paid in full, the Servicer shall have the option to purchase the
Owner Trust Estate, other than the Collection Account; provided, however,
that, unless Moody's agrees otherwise, the Servicer may not effect any such
purchase if the rating of CFC's long-term debt obligations is less than Baa3
by Moody's, unless the Owner Trustee and the Indenture Trustee shall have
received an Opinion of Counsel to the effect that such purchase would not
constitute a fraudulent conveyance. To exercise such option, the Servicer
shall deposit pursuant to Section 5.05 in the Collection Account an amount
equal to the aggregate Purchase Amount for the Receivables (including
defaulted Receivables), plus the appraised value of any such other property
held by the Trust other than the Collection Account, such value to be
determined by an appraiser mutually agreed upon by the Servicer, the Owner
Trustee and the Indenture Trustee, and shall succeed to all interests in and
to the Trust. Notwithstanding the foregoing, the Servicer shall not be
permitted to exercise such option unless the amount to be deposited in the
Collection Account pursuant to the preceding sentence is greater than or
equal to the sum of the outstanding principal balance of the Notes and the
Certificate Balance of the Overcollateralization Certificates and all accrued
but unpaid interest (including any overdue interest and premium) thereon.
(b) As described in Article IX of the Trust Agreement, notice of any
termination of the Trust shall be given by the Servicer to the Owner Trustee
and the Indenture Trustee as soon as practicable after the Servicer has
received notice thereof.
46
<PAGE>
ARTICLE X
Miscellaneous
SECTION 10.01. Amendment. This Agreement may be amended by the
Seller, the Servicer and the Issuer, with the consent of the Indenture
Trustee, but without the consent of any of the Noteholders or the
Certificateholders, to cure any ambiguity, to correct or supplement any
provisions in this Agreement or for the purpose of adding any provisions to
or changing in any manner or eliminating any of the provisions in this
Agreement (including for the issuance of Fixed Value Securities pursuant to
Section 2.03) or of modifying in any manner the rights of the Noteholders or
the Certificateholders; provided, however, that such action shall not, as
evidenced by an Opinion of Counsel delivered to the Owner Trustee and the
Indenture Trustee, adversely affect in any material respect the interests of
any Noteholder or Certificateholder.
This Agreement may also be amended from time to time by the Seller,
the Servicer and the Issuer, with the consent of the Indenture Trustee, the
consent of the Holders of Notes evidencing not less than a majority of the
Outstanding Amount of the Notes, the consent of the Holders (as defined in
the Trust Agreement) of outstanding Trust Certificates evidencing not less
than a majority of the Percentage Interests (as defined in the Trust
Agreement) and the consent of the Holders (as defined in the Trust Agreement)
of Overcollateralization Certificates evidencing not less than a majority of
the Certificate Balance of the Overcollateralization Certificates, for the
purpose of adding any provisions to or changing in any manner or eliminating
any of the provisions of this Agreement or of modifying in any manner the
rights of the Noteholders or the Certificateholders; provided, however, that
no such amendment shall (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 for the benefit of the
Noteholders or the Certificateholders or (b) reduce the aforesaid percentage
of the Outstanding Amount of the Notes, the Percentage Interests (as defined
in the Trust Agreement) or the aforesaid percentage of the Certificate
Balance of the Overcollateralization Certificates, the Holders of which are
required to consent to any such amendment, without the consent of the Holders
of all the outstanding Notes, the Holders (as defined in the Trust Agreement)
of all the outstanding Trust Certificates and the Holders (as defined in the
Trust Agreement) of all the outstanding Overcollateralization Certificates.
Promptly after the execution of any such amendment or consent, the
Owner Trustee shall furnish written notification of the substance of such
amendment or consent to each Certificateholder, the Indenture Trustee and
each of the Rating Agencies.
It shall not be necessary for the consent of Certificateholders or
Noteholders pursuant to this Section to approve the particular form of any
proposed amendment or consent, but it shall be sufficient if such consent
shall approve the substance thereof.
Prior to the execution of any amendment to this Agreement, the Owner
Trustee and the Indenture 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
47
<PAGE>
Counsel referred to in Section 10.02(i)(1). The Owner Trustee and the
Indenture Trustee may, but shall not be obligated to, enter into any such
amendment which affects the Owner Trustee's or the Indenture Trustee's, as
applicable, own rights, duties or immunities under this Agreement or
otherwise.
SECTION 10.02. Protection of Title to Trust. i) 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
Issuer and of the Indenture Trustee in the Receivables and in the proceeds
thereof. The Seller shall deliver (or cause to be delivered) to the Owner
Trustee and the Indenture Trustee file-stamped copies of, or filing receipts
for, any document filed as provided above, as soon as available following
such filing.
(b) Neither the Seller nor the Servicer shall change its name,
identity or corporate structure in any manner that would, could or might make
any financing statement or continuation statement filed in accordance with
paragraph (a) above seriously misleading within the meaning of ss. 9-402(7)
of the UCC, unless it shall have given the Owner Trustee and the Indenture
Trustee at least five days' prior written notice thereof and shall have
promptly filed appropriate amendments to all previously filed financing
statements or continuation statements.
(c) Each of the Seller and the Servicer shall have an obligation to
give the Owner Trustee and the Indenture Trustee at least 60 days' prior
written notice of any relocation of its principal executive office if, as a
result of such relocation, the applicable provisions of the 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 or new financing statement. The Servicer shall at all times
maintain each office from which it shall service Receivables, and its
principal executive office, within the United States of America.
(d) The Servicer shall maintain accounts and records as to each
Standard Receivable and each Fixed Value Receivable accurately and in
sufficient detail to permit (i) the reader thereof to know at any time the
status of such Standard Receivable or Fixed Value 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 Standard Receivable or Fixed Value Receivable and the amounts from time
to time deposited in the Collection Account in respect of such Standard
Receivable or Fixed Value Receivable.
(e) The Servicer shall maintain its computer systems so that, from
and after the time of sale under this Agreement of the Standard Receivables
and the Fixed Value Receivables, the Servicer's master computer records
(including any backup archives) that refer to a Standard Receivable or Fixed
Value Receivable shall indicate clearly the interest of the Issuer and the
Indenture Trustee in such Standard Receivable or Fixed Value Receivable and
that such Standard Receivable or Fixed Value Receivable is owned by the
Issuer and has been pledged to the Indenture Trustee. Indication of the
Issuer's and the Indenture Trustee's interest in a Standard Receivable or
Fixed Value Receivable shall be deleted from or modified on the Servicer's
48
<PAGE>
computer systems when, and only when, the related Receivable shall have been
paid in full or 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 printouts (including any restored
from backup archives) that, if they shall refer in any manner whatsoever to
any Standard Receivable or Fixed Value Receivable, shall indicate clearly
that such Standard Receivable or Fixed Value Receivable has been sold and is
owned by the Issuer and has been pledged to the Indenture Trustee.
(g) The Servicer shall permit the Indenture Trustee and its agents
at any time during normal business hours to inspect, audit and make copies of
and abstracts from the Servicer's records regarding any Standard Receivable
or Fixed Value Receivable.
(h) Upon request, the Servicer shall furnish to the Owner Trustee or
to the Indenture Trustee, within five Business Days, a list of all
Receivables (by contract number and name of Obligor) then held as part of the
Trust, together with a reconciliation of such list to the Schedule of
Receivables and to each of the Servicer's Certificates furnished before such
request indicating removal of Receivables from the Trust.
(i) The Servicer shall deliver to the Owner Trustee and the
Indenture Trustee:
(1) promptly after the execution and delivery of this
Agreement and of each amendment hereto, an Opinion of Counsel
stating that, in the opinion of such counsel, either (A) all
financing statements and continuation statements have been executed
and filed that are necessary fully to preserve and protect the
interest of the Owner Trustee and the Indenture 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
(2) within 90 days after the beginning of each calendar
year beginning with the first calendar year beginning more than
three months after the Cutoff Date, an Opinion of Counsel, dated as
of a date during such 90-day period, stating that, in the opinion of
such counsel, either (A) all financing statements and continuation
statements have been executed and filed that are necessary fully to
preserve and protect the interest of the Owner Trustee and the
Indenture 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 (1) or (2) above shall specify
any action necessary (as of the date of such opinion) to be taken in the
following year to preserve and protect such interest.
49
<PAGE>
(j) The Seller shall, to the extent required by applicable law,
cause the Notes to be registered with the Commission pursuant to Section
12(b) or Section 12(g) of the Exchange Act within the time periods specified
in such sections.
SECTION 10.03. Notices. All demands, notices, communications and
instructions upon or to the Seller, the Servicer, the Owner Trustee, the
Indenture Trustee or the Rating Agencies under this Agreement shall be in
writing, personally delivered or mailed by certified mail, return receipt
requested, and shall be deemed to have been duly given upon receipt (a) in
the case of the Seller or the Servicer, to Chrysler Financial Corporation,
27777 Franklin Road, Southfield, Michigan 48034, Attention of Assistant
Secretary ((248) 948-3067), (b) in the case of the Issuer or the Owner
Trustee, at the Corporate Trust Office (as defined in the Trust Agreement),
(c) in the case of the Indenture Trustee, at the Corporate Trust Office, (d)
in the case of Moody's, to Moody's Investors Service, Inc., ABS Monitoring
Department, 99 Church Street, New York, New York 10007, (e) in the case of
Standard & Poor's, to Standard & Poor's Ratings Services, a division of The
McGraw-Hill Companies, Inc., 25 Broadway (15th Floor), New York, New York
10004, Attention of Asset Backed Surveillance Department, (f) in the case of
Fitch IBCA, Inc., to One State Street Plaza, New York, N.Y. 10004, and (g) in
the case of Duff & Phelps Credit Rating Co., to 17 State Street, 12th Floor,
New York, New York 10004; or, as to each of the foregoing, at such other
address as shall be designated by written notice to the other parties.
SECTION 10.04. Assignment by the Seller or the Servicer.
Notwithstanding anything to the contrary contained herein, except as provided
in the remainder of this Section, as provided in Sections 6.04 and 7.03
herein 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. The Issuer and the Servicer hereby acknowledge and consent
to the conveyance and assignment (i) by the Seller to the Company pursuant to
the Purchase Agreement and (ii) by the Company to a limited liability company
or other Person (provided that conveyance and assignment is made in
accordance with Section 5.06 of the Purchase Agreement), of any and all of
the Seller's rights and interests (and corresponding obligations, if any)
hereunder with respect to receiving amounts from the Reserve Account and with
respect to receiving and conveying any Fixed Value Payments, and the Issuer
and the Servicer hereby agree that the Company, and any such assignee of the
Company, shall be entitled to enforce such rights and interests directly
against the Issuer as if the Company, or such assignee of the Company, were
itself a party to this Agreement.
SECTION 10.05. Limitations on Rights of Others. The provisions of
this Agreement are solely for the benefit of the Seller, the Company (and any
assignee of the Company pursuant to Section 10.04), the Servicer, the Issuer,
the Owner Trustee, the Certificateholders, the Indenture Trustee and the
Noteholders, and nothing in this Agreement, whether express or implied, shall
be construed to give to any other Person any legal or equitable right, remedy
or claim in the Owner Trust Estate or under or in respect of this Agreement
or any covenants, conditions or provisions contained herein.
SECTION 10.06. Severability. Any provision of this Agreement that is
prohibited or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof, and
any
50
<PAGE>
such prohibition or unenforceability in any jurisdiction shall not invalidate
or render unenforceable such provision in any other jurisdiction.
SECTION 10.07. Separate Counterparts. This Agreement may be executed
by the parties hereto in separate counterparts, each of which when so
executed and delivered shall be an original, but all such counterparts shall
together constitute but one and the same instrument.
SECTION 10.08. Headings. The headings of the various Articles and
Sections herein are for convenience of reference only and shall not define or
limit any of the terms or provisions hereof.
SECTION 10.09. Governing Law. This Agreement shall be construed in
accordance with the laws of the State of New York, without reference to its
conflict of law provisions, and the obligations, rights and remedies of the
parties hereunder shall be determined in accordance with such laws.
SECTION 10.10. Assignment by Issuer. The Seller hereby acknowledges
and consents to any mortgage, pledge, assignment and grant of a security
interest by the Issuer to the Indenture Trustee pursuant to the Indenture for
the benefit of the Noteholders of all right, title and interest of the Issuer
in, to and under the Receivables and/or the assignment of any or all of the
Issuer's rights and obligations hereunder to the Indenture Trustee.
SECTION 10.11. Nonpetition Covenants. i) Notwithstanding any prior
termination of this Agreement, the Servicer and the Seller shall not, prior
to the date which is one year and one day after the termination of this
Agreement with respect to the Issuer or the Company, acquiesce, petition or
otherwise invoke or cause the Issuer or the Company (or any assignee of the
Company pursuant to Section 10.04) to invoke the process of any court or
government authority for the purpose of commencing or sustaining a case
against the Issuer or the Company (or any assignee of the Company pursuant to
Section 10.04) under any federal or state bankruptcy, insolvency or similar
law, or appointing a receiver, liquidator, assignee, trustee, custodian,
sequestrator or other similar official of the Issuer or the Company (or any
assignee of the Company pursuant to Section 10.04) or any substantial part of
its property, or ordering the winding up or liquidation of the affairs of the
Issuer or the Company (or any assignee of the Company pursuant to Section
10.04).
(b) Notwithstanding any prior termination of this Agreement, the
Servicer shall not, prior to the date which is one year and one day after the
termination of this Agreement with respect to the Seller, acquiesce, petition
or otherwise invoke or cause the Seller to invoke the process of any court or
government authority for the purpose of commencing or sustaining a case
against the Seller under any federal or state bankruptcy, insolvency or
similar law, or appointing a receiver, liquidator, assignee, trustee,
custodian, sequestrator or other similar official of the Seller or any
substantial part of its property, or ordering the winding up or liquidation
of the affairs of the Seller.
51
<PAGE>
SECTION 10.12. Limitation of Liability of Owner Trustee and
Indenture Trustee. i) Notwithstanding anything contained herein to the
contrary, this Agreement has been countersigned by Chase Manhattan Bank
Delaware not in its individual capacity but solely in its capacity as Owner
Trustee of the Issuer and in no event shall Chase Manhattan Bank Delaware in
its individual capacity or, except as expressly provided in the Trust
Agreement, as beneficial owner of the Issuer have any liability for the
representations, warranties, covenants, agreements or other obligations of
the Issuer hereunder or in any of the certificates, notices or agreements
delivered pursuant hereto, as to all of which recourse shall be had solely to
the assets of the Issuer. For all purposes of this Agreement, in the
performance of its duties or obligations hereunder or in the performance of
any duties or obligations of the Issuer hereunder, the Owner Trustee shall be
subject to, and entitled to the benefits of, the terms and provisions of
Articles VI, VII and VIII of the Trust Agreement.
(b) Notwithstanding anything contained herein to the contrary, this
Agreement has been accepted by The First National Bank of Chicago, not in its
individual capacity but solely as Indenture Trustee and in no event shall The
First National Bank of Chicago have any liability for the representations,
warranties, covenants, agreements or other obligations of the Issuer
hereunder or in any of the certificates, notices or agreements delivered
pursuant hereto, as to all of which recourse shall be had solely to the
assets of the Issuer.
52
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed by their respective officers as of the day and year first
above written.
PREMIER AUTO TRUST 1998-5
By: CHASE MANHATTAN BANK
DELAWARE, not in its
individual capacity but
solely as Owner Trustee on
behalf of the Trust
By: /s/ John J. Cashin
------------------
Name: John J. Cashin
Title: Vice President
CHRYSLER FINANCIAL CORPORATION,
Seller and Servicer
By: /s/ Dennis M. Cantwell
-------------------------------
Name: Dennis M. Cantwell
Title: Vice President and Treasurer
Acknowledged and accepted
as of the day and year
first above written:
FIRST NATIONAL BANK OF CHICAGO,
not in its individual capacity
but solely as Indenture Trustee
By: /s/ Jeffrey L. Kinney
---------------------
Name: Jeffrey L. Kinney
Title: Vice President
53
<PAGE>
SCHEDULE A
Schedule of Receivables
Delivered to the Owner Trustee and Indenture Trustee at Closing
<PAGE>
SCHEDULE B
Location of Receivable Files
Chrysler Financial Corporation
27777 Franklin Road
Southfield, MI 48034-8288
<PAGE>
EXHIBIT A
[ Reserved ]
A-1
<PAGE>
EXHIBIT B
Form of Distribution Statement to Noteholders
Chrysler Financial Corporation
Premier Auto Trust 1998-5 Distribution Date Statement to Noteholders
- ----------------------------------------------------------------------------
Principal Distribution Amount
Class A-1 Notes: ($ per $1,000 original principal amount)
Class A-2 Notes: ($ per $1,000 original principal amount)
Class A-3 Notes: ($ per $1,000 original principal amount)
Class A-4 Notes: ($ per $1,000 original principal amount)
Interest Distribution Amount
Class A-1 Notes: ($ per $1,000 original principal amount)
Class A-2 Notes: ($ per $1,000 original principal amount)
Class A-3 Notes: ($ per $1,000 original principal amount)
Class A-4 Notes: ($ per $1,000 original principal amount)
Note Balance
Class A-1 Notes
Class A-2 Notes
Class A-3 Notes
Class A-4 Notes
Note Pool Factor
Class A-1 Notes
Class A-2 Notes
Class A-3 Notes
Class A-4 Notes
Servicing Fee
Servicing Fee Per $1,000 Note
Realized Losses
Reserve Account Balance
B-1
<PAGE>
EXHIBIT C
Form of Servicer's Certificate
Chrysler Financial Corporation
Premier Auto Trust 1998-5 Monthly Servicer's Certificate
=============================================================================
Period
Distribution Date
Dates Covered From & Incl. To & Incl.
- -----------------------------------------------------------------------------
Collections
Accrual
30/360 Days
Actual/360 Days
Receivables Balances Beginning Ending
- -----------------------------------------------------------------------------
Pool Balance
Simple Interest
Original Pool Balance
Principal Distribution Amount
- -----------------------------------------------------------------------------
Principal Collections
+ Repurchases
+ Liquidation Proceeds
+ Realized Losses
Interest Distribution Amount
- -----------------------------------------------------------------------------
Collections - Simple Interest Contracts
+ Investment Earnings
Total Distribution Amount
- -----------------------------------------------------------------------------
Principal Distribution Amount
+ Interest Distribution Amount
-- Realized Losses
Total Distribution Amount:
Loss & Delinquency
C-1
<PAGE>
<TABLE>
<CAPTION>
Account Activity
-----------------------------------------------
- -----------------------------------------------------------------------------------------------------
Beginning Ending Interest/Interest
Balance Balance Change Factor Servicing
------------------------------------------------------------
Shortfall
- -----------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Initial Pool
Principal Paydown
Reserve
Notes
Class A-1
Class A-2
Class A-3
Class A-4
Overcollateralization
Overcollateralization Percentage
<CAPTION>
Principal Allocation
----------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------
Mandatory
Regular Accelerated Redemption/ Total Principal
Principal Principal Repayment Principal Shortfall
----------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Notes
Class A-1
Class A-2
Class A-3
Class A-4
Total
<CAPTION>
=================================================================================
==========================================================================================================
Miscellaneous
- -----------------------------------------------------------------------------
Amounts allocated for distribution to Certificateholders
Release Period Noteholders' Principal Distributable Amount
Cash Release Amount
Receivables to be released
Specified Reserve Amount
Distribution Amount to Seller
Servicing Fee to Servicer
Allocation of Funds
- -----------------------------------------------------------------------------
Sources
Principal Distribution Amount
Interest Distribution Amount
Redemption/Prepay Amount
Total Sources
</TABLE>
C-2
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
PREMIER AUTO TRUST 1998-5
FOR THE PERIOD OCTOBER 1, 1998 (INCEPTION) THROUGH DECEMBER 31, 1998
FINANCIAL DATA SCHEDULE
PURSUANT TO ARTICLE 5 OF REGULATION S-X
$ Millions
</LEGEND>
<MULTIPLIER> 1,000,000
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-START> OCT-01-1998
<PERIOD-END> DEC-31-1998
<CASH> $ 5
<SECURITIES> 0
<RECEIVABLES> 1,654
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 1,659
<CURRENT-LIABILITIES> 8
<BONDS> 1,651
<COMMON> 0
0
0
<OTHER-SE> 0
<TOTAL-LIABILITY-AND-EQUITY> 1,659
<SALES> 0
<TOTAL-REVENUES> 0
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 0
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 0
<EPS-PRIMARY> 0.00
<EPS-DILUTED> 0.00
</TABLE>
