<PAGE>
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON SEPTEMBER 30, 1997
REGISTRATION NO. 333-
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------------
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
------------------------
CHASE MANHATTAN AUTO TRUSTS
(ISSUER OF SECURITIES)
CHASE MANHATTAN BANK USA, NATIONAL ASSOCIATION
(ORIGINATOR OF THE TRUST DESCRIBED HEREIN)
(EXACT NAME AS SPECIFIED IN REGISTRANT'S CHARTER)
UNITED STATES 22-2382028
(STATES OR OTHER JURISDICTIONS (I.R.S. EMPLOYER
OF INCORPORATION) IDENTIFICATION NUMBERS)
------------------------
802 DELAWARE AVENUE
WILMINGTON, DELAWARE 19801
(302) 575-5000
(ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER,
INCLUDING AREA CODE, OF REGISTRANT'S PRINCIPAL EXECUTIVE OFFICE)
------------------------
ANDREW T. SEMMELMAN
SECRETARY
CHASE MANHATTAN BANK USA, NATIONAL ASSOCIATION
802 DELAWARE AVENUE
WILMINGTON, DELAWARE 19801
(302) 575-5033
(NAME, ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER,
INCLUDING AREA CODE, OF AGENT FOR SERVICE)
------------------------
COPIES TO:
<TABLE>
<S> <C> <C>
MARTIN R. JOYCE LAURA PALMA WILLIAM A. GRAY
THE CHASE MANHATTAN BANK SIMPSON THACHER & BARTLETT ORRICK, HERRINGTON & SUTCLIFFE LLP
270 PARK AVENUE 425 LEXINGTON AVENUE 666 FIFTH AVENUE
NEW YORK, NEW YORK 10017 NEW YORK, NEW YORK 10017 NEW YORK, NEW YORK 10103
</TABLE>
------------------------
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: From time
to time after this registration statement becomes effective as determined by
market conditions.
If any of the securities being registered on this Form are to be offered
pursuant to dividend or interest reinvestment plans, please check the following
box. / /
If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box. /x/
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act Registration Statement number of the earlier
effective Registration Statement for the same offering. / /
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
Registration Statement number of the earlier effective Registration Statement
for the same offering. / /
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. / /
------------------------
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
PROPOSED MAXIMUM PROPOSED MAXIMUM AMOUNT OF
TITLE OF SECURITIES TO BE AMOUNT TO BE AGGREGATE PRICE AGGREGATE OFFERING REGISTRATION
REGISTERED(1) REGISTERED(2) PER UNIT(2) PRICE(2) FEE(2)(3)
<S> <C> <C> <C> <C>
Asset-Backed Securities $5,000,000,000 100% $5,000,000,000 $1,515,152
</TABLE>
(1) The Securities are also being registered for the purpose of market making.
(2) Estimated solely for the purpose of calculating the registration fee.
(3) In addition to $355,421,898 of unissued Asset-Backed Securities previously
registered under Registration Statement No. 333-7575 being carried forward.
A Registration Fee of $107,703 was previously paid with respect to such
amount.
------------------------
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL
FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF
THE SECURITIES ACT OF 1933, OR UNTIL THE REGISTRATION STATEMENT SHALL THEREAFTER
BECOME EFFECTIVE IN ACCORDANCE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT
TO SAID SECTION 8(A), MAY DETERMINE.
PURSUANT TO RULE 429 OF THE GENERAL RULES AND REGULATIONS UNDER THE
SECURITIES ACT OF 1933, THE PROSPECTUS WHICH IS PART OF THIS REGISTRATION
STATEMENT IS A COMBINED PROSPECTUS WHICH ALSO RELATES TO $355,421,898 OF
UNISSUED ASSET-BACKED SECURITIES REGISTERED UNDER REGISTRATION STATEMENT NO.
333-7575 PREVIOUSLY FILED BY THE REGISTRANT. THIS REGISTRATION STATEMENT
CONSTITUTES POST-EFFECTIVE AMENDMENT NO. 1 TO REGISTRATION STATEMENT NO.
333-7575.
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<PAGE>
INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A
REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR MAY
OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT BECOMES
EFFECTIVE AND WITHOUT DELIVERY OF A FINAL PROSPECTUS SUPPLEMENT AND ACCOMPANYING
PROSPECTUS. THIS PROSPECTUS SUPPLEMENT AND THE ACCOMPANYING PROSPECTUS SHALL
NOT CONSTITUTE AN OFFER TO SELL OR THE SOLICITATION OF AN OFFER TO BUY NOR SHALL
THERE BE ANY SALE OF THESE SECURITIES IN ANY STATE IN WHICH SUCH OFFER,
SOLICITATION OR SALE WOULD BE UNLAWFUL PRIOR TO REGISTRATION OR QUALIFICATION
UNDER THE SECURITIES LAWS OF ANY SUCH STATE.
SUBJECT TO COMPLETION, DATED SEPTEMBER 29, 1997
PROSPECTUS SUPPLEMENT
(To Prospectus dated , 199 )
FORM A--GRANTOR TRUST
$
CHASE MANHATTAN AUTO GRANTOR TRUST 199 -
$ % AUTOMOBILE LOAN PASS-THROUGH CERTIFICATES, CLASS A
$ % AUTOMOBILE LOAN PASS-THROUGH CERTIFICATES, CLASS B
CHASE MANHATTAN BANK USA, NATIONAL ASSOCIATION
SELLER AND SERVICER
The Chase Manhattan Auto Grantor Trust 199 - (the 'TRUST') will be formed
pursuant to a Pooling and Servicing Agreement, to be dated as of , 199 ,
among Chase Manhattan Bank USA, National Association, in its capacities as
seller (the 'SELLER') and as servicer (the 'SERVICER') and
, as Trustee. The Trust will issue
$ aggregate principal amount of % Automobile Loan Pass-Through
Certificates, Class A (the 'CLASS A CERTIFICATES') and $ aggregate
principal amount of % Automobile Loan Pass-Through Certificates, Class B (the
'CLASS B CERTIFICATES' and, together with the Class A Certificates, the
'CERTIFICATES'). The Class A Certificates will evidence in the aggregate an
approximate % undivided ownership interest in the Trust, and the Class B
Certificates will evidence in the aggregate an approximate % undivided
ownership interest in the Trust. The rights of the Class B Certificateholders to
receive distributions with respect to the Receivables are subordinated to the
rights of the Class A Certificateholders to the extent described herein.
Principal and interest at the applicable Pass-Through Rate, generally will be
distributed to the Certificateholders on the 15th day of each month (or, if such
15th day is not a Business Day, the next following Business Day), commencing
, 199 . The Trust
(continued on the following page)
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There currently is no secondary market for the Certificates and there is no
assurance that one will develop.
The Underwriters expect, but are not obligated, to make a market in the
Certificates. There is no assurance that any such market will develop or
continue.
THE CERTIFICATES REPRESENT BENEFICIAL INTERESTS IN THE TRUST ONLY AND DO NOT
REPRESENT OBLIGATIONS OF OR INTERESTS IN CHASE MANHATTAN BANK USA, NATIONAL
ASSOCIATION OR THE CHASE MANHATTAN BANK OR ANY AFFILIATE THEREOF. A CERTIFICATE
IS NOT A DEPOSIT AND IS NOT INSURED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION
(THE 'FDIC'). THE RECEIVABLES ARE NOT INSURED OR GUARANTEED BY THE FDIC OR ANY
OTHER GOVERNMENTAL AGENCY.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS SUPPLEMENT OR THE PROSPECTUS. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
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PROSPECTIVE INVESTORS SHOULD CONSIDER, AMONG OTHER THINGS, THE INFORMATION SET
FORTH UNDER THE HEADING 'RISK FACTORS' IN THIS PROSPECTUS SUPPLEMENT COMMENCING
ON PAGE S-5 AND COMMENCING ON PAGE 13 IN THE ACCOMPANYING PROSPECTUS.
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<TABLE>
<CAPTION>
PROCEEDS TO THE
PRICE TO PUBLIC(1) UNDERWRITING DISCOUNT SELLER(1)(2)
<S> <C> <C> <C>
PER CLASS A CERTIFICATE % % %
PER CLASS B CERTIFICATE % % %
TOTAL $ $ $
</TABLE>
(1) Plus accrued interest from , 199 , if any.
(2) Before deduction of expenses estimated at $ .
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[This Prospectus Supplement may be used by Chase Securities Inc., an affiliate
of the Seller and a subsidiary of The Chase Manhattan Corporation, in connection
with offers and sales related to market-making transactions in the Certificates.
Chase Securities Inc. may act as principal or agent in such transactions. Such
sales will be made at prices related to prevailing prices at the time of sale.]
The Certificates are being offered by the Underwriters, subject to prior sale,
when, as and if issued to and accepted by the Underwriters, subject to approval
of certain legal matters by counsel for the Underwriters. The Underwriters
reserve the right to reject orders in whole or in part. It is expected that the
Certificates will be delivered in book-entry form, on or about , 199
(the 'CLOSING DATE'), through the facilities of The Depository Trust Company
('DTC'), Cedel Bank, societe anonyme ('CEDEL') or the Euroclear System
('EUROCLEAR'), in each case against payment therefor in immediately available
funds.
Underwriters of the Class A Certificates
Underwriters of the Class B Certificates
THE DATE OF THIS PROSPECTUS SUPPLEMENT IS , 199
<PAGE>
(continued from previous page)
property will include a pool of simple interest retail installment sales
contracts and purchase money notes and other notes secured by new and used
automobiles and light-duty trucks, certain monies received thereunder on or
after , 199 (the 'CUTOFF DATE'), security interests in the vehicles
financed thereby, amounts on deposit in certain accounts maintained by the
Trustee for the benefit of Certificateholders and proceeds from claims on
certain insurance policies, all as more fully described herein. The final
scheduled Distribution Date of the Certificates will be the
Distribution Date (the 'FINAL SCHEDULED DISTRIBUTION DATE').
The Certificates initially may be represented by Certificates registered in
the name of Cede & Co., ('CEDE') the nominee of DTC. The interests of beneficial
owners of the Certificates will be represented by book entries on the records of
DTC and participating members thereof. Definitive Certificates will be available
only under the limited circumstances described herein.
[Application will be made to list the Certificates on the Luxembourg Stock
Exchange.]
THIS PROSPECTUS SUPPLEMENT DOES NOT CONTAIN COMPLETE INFORMATION ABOUT THE
OFFERING OF THE CERTIFICATES. ADDITIONAL INFORMATION IS CONTAINED IN THE
PROSPECTUS. PROSPECTIVE INVESTORS ARE URGED TO READ BOTH THIS PROSPECTUS
SUPPLEMENT AND THE PROSPECTUS IN FULL. SALES OF THE CERTIFICATES MAY NOT BE
CONSUMMATED UNLESS THE PURCHASER HAS RECEIVED BOTH THIS PROSPECTUS SUPPLEMENT
AND THE PROSPECTUS.
CERTAIN PERSONS PARTICIPATING IN THIS OFFERING MAY ENGAGE IN TRANSACTIONS
THAT STABILIZE, MAINTAIN, OR OTHERWISE AFFECT THE PRICE OF
THE CERTIFICATES, INCLUDING OVER-ALLOTMENT TRANSACTIONS, STABILIZING
TRANSACTIONS, SYNDICATE COVERING TRANSACTIONS AND PENALTY BIDS. FOR A
DESCRIPTION OF THESE ACTIVITIES, SEE 'UNDERWRITING' HEREIN.
Upon receipt of a request by an investor, or his or her representative,
within the period during which there is a prospectus delivery obligation, the
Underwriters will transmit or cause to be transmitted promptly, without charge
and in addition to any such delivery requirements, a paper copy of this
Prospectus Supplement and a Prospectus or this Prospectus Supplement and a
Prospectus encoded in an electronic format.
SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS
Certain of the matters discussed under the caption 'The Receivables
Pool--Delinquencies and Loan Loss Information' in this Prospectus Supplement may
constitute forward-looking statements within the meaning of Section 7A of the
Securities Act, and as such may involve known and unknown risks, uncertainties
and other factors which may cause the actual results, performance or
achievements of the Receivables to be materially different from any future
results, performance or achievements expressed or implied by such
forward-looking statements.
ii
<PAGE>
SUMMARY OF TERMS
This Summary of Terms is qualified in its entirety by reference to the
detailed information appearing elsewhere herein and in the Prospectus. Certain
capitalized terms used in this Summary are defined elsewhere in this Prospectus
Supplement on the pages indicated in the 'Index of Terms' or, to the extent not
defined herein, have the meanings assigned to such terms in the Prospectus.
<TABLE>
<S> <C>
ISSUER.................. Chase Manhattan Auto Grantor Trust 199 - (the 'TRUST').
SELLER.................. Chase Manhattan Bank USA, National Association ('CHASE
USA'), a national banking association headquartered in
Delaware and a wholly-owned subsidiary of The Chase
Manhattan Corporation (in such capacity, the 'SELLER'
or individually, the 'BANK').
SERVICER................ Chase USA (in such capacity, the 'SERVICER').
SECURITIES OFFERED...... The Trust will issue Automobile Loan Pass-Through
Certificates pursuant to the Pooling and Servicing
Agreement (the 'AGREEMENT') between the Seller, the
Servicer, and , as trustee
(the 'TRUSTEE') and as collateral agent (the
'COLLATERAL AGENT') in an aggregate initial principal
amount of $ . The Certificates will
represent fractional undivided interests in the Trust.
The Certificates will consist of $
aggregate principal amount of % Automobile Loan
Pass-Through Certificates, Class A, and $
aggregate principal amount of % Automobile Loan
Pass-Through Certificates, Class B. The Trust property
will include the Receivables, all monies received
thereunder on or after the Cutoff Date (other than the
Retained Yield), security interests in the Financed
Vehicles, amounts as from time to time may be held in
the Collection Account and the Distribution Accounts,
proceeds from the exercise of the Seller's recourse
rights against Dealers, proceeds from claims on certain
insurance policies, rights with respect to repossessed
vehicles and certain rights under the Agreement. The
Retained Yield and the Reserve Account, and any amounts
therein, will not be property of the Trust, but will be
pledged to and held by the Collateral Agent, as secured
party.
The Class A Certificates will evidence in the aggregate
an approximate % undivided ownership interest (the
'CLASS A PERCENTAGE') in the Trust, and the Class B
Certificates will evidence in the aggregate an
approximate % undivided ownership interest (the 'CLASS
B PERCENTAGE') in the Trust. The Class B Certificates
are subordinated to the Class A Certificates to the
extent described herein.
The Certificates will be offered for purchase in
denominations of $1,000 and integral multiples thereof.
See 'Description of the Certificates--Denomination and
Registration of Certificates' herein and 'Description
of the Certificates-- General' in the Prospectus.
REGISTRATION OF THE
CERTIFICATES.......... The Certificates initially will be represented by
Certificates registered in the name of Cede, as the
nominee of DTC. Certificateholders will not be entitled
to receive a Definitive Certificate representing such
person's interest in the Trust, except in the event
that Definitive Certificates are issued under the
limited circumstances described in the Prospectus.
Certificateholders may elect to hold their Certificates
through DTC (in the United States) or Cedel or
Euroclear (in Europe). All references herein to
Certificateholders shall reflect the rights of
Certificateholders, as such rights may be exercised
through DTC and its Participants (including Cedel and
Euroclear), except as otherwise specified
</TABLE>
S-1
<PAGE>
<TABLE>
<S> <C>
herein. See 'Certain Information Regarding the
Securities--Book-Entry Registration' and '--Definitive
Securities' in the Prospectus.
CLASS A PASS-THROUGH
RATE.................. % per annum (the 'CLASS A PASS-THROUGH RATE'),
calculated on the basis of a 360-day year comprised
of twelve 30-day months.
CLASS B PASS-THROUGH
RATE.................. % per annum (the 'CLASS B PASS-THROUGH RATE,' and,
together with the Class A Pass-Through Rate, each a
'PASS-THROUGH RATE'), calculated on the basis of a
360-day year comprised of twelve 30-day months.
DISTRIBUTION DATE....... The 15th day of each month (or, if such 15th day is not
a day on which the Trustee and banks located in New
York, New York, Wilmington, Delaware and
are open for the purpose of
conducting a commercial banking business (a 'BUSINESS
DAY'), the next following Business Day) commencing
, 199 .
INTEREST................ On each Distribution Date, interest will be distributed
at the Class A Pass-Through Rate on the Class A
Certificate Balance and at the Class B Pass-Through
Rate on the Class B Certificate Balance, in each case
as of the immediately preceding Distribution Date
(after giving effect to all distributions on such
preceding Distribution Date) to the holders of record
of the Class A Certificates (the 'CLASS A
CERTIFICATEHOLDERS') and the Class B Certificates (the
'CLASS B CERTIFICATEHOLDERS' and, together with the
Class A Certificateholders, the 'CERTIFICATEHOLDERS')
as of the date immediately preceding such Distribution
Date or, if Definitive Certificates are issued, the
last day of the immediately preceding calendar month
(each such date, a 'RECORD DATE') to the extent that
there are available funds therefor as described herein.
The rights of Class B Certificateholders to receive
payments of interest will be subordinated to the rights
of the Class A Certificateholders to receive payments
of interest to the extent described herein.
PRINCIPAL............... On each Distribution Date, all payments, including full
and partial prepayments, of principal collected by the
Servicer during the preceding Collection Period and
certain other payments allocable to principal, as
described more fully herein, will be distributed by the
Trustee pro rata to the Class A Certificateholders and
to the Class B Certificateholders of record on the
preceding Record Date to the extent that there are
available funds therefor as described herein. See
'Description of the Certificates--Distributions on
Certificates' herein. The rights of the Class B
Certificateholders to receive payments of principal
will be subordinated to the rights of the Class A
Certificateholders to receive payments of interest and
principal to the extent described herein. The 'CLASS A
CERTIFICATE BALANCE' and 'CLASS B CERTIFICATE BALANCE'
will initially equal $ and
$ , respectively, and, in each case, will
thereafter equal the initial Class A Certificate
Balance or the initial Class B Certificate Balance, as
the case may be, reduced by all principal distributions
on the Class A Certificates and the Class B
Certificates, respectively.
SUBORDINATION OF CLASS B
CERTIFICATES.......... Distributions of interest and principal on the Class B
Certificates will be subordinated to distributions of
interest and principal due on the Class A Certificates
to the extent described herein. The Class B
Certificateholders will not receive any distributions
of interest with respect to a Collection Period until
the full amount of interest on the Class A Certificates
relating to such Collection Period has been deposited
in the Class A Distribution Account. The Class B
Certificateholders will not receive any distributions
of principal with respect to such Collection Period
until the full amount of interest on and principal of
the
</TABLE>
S-2
<PAGE>
<TABLE>
<S> <C>
Class A Certificates relating to such Collection Period
has been deposited in the Class A Distribution Account.
See 'Risk Factors--Subordination; Limited Assets'
herein and 'Risk Factors--Subordination' in the
Prospectus.
ADVANCES................ On each Deposit Date, the Servicer may, in its sole
discretion, make an Advance with respect to each
Receivable (other than a Defaulted Receivable) equal to
the excess, if any, of (x) the product of the principal
balance of such Receivable as of the related Settlement
Date and one-twelfth of its Contract Rate, over (y) the
interest actually received by the Servicer with respect
to such Receivable from the Obligor or from payments of
the Repurchase Amount during or with respect to such
Collection Period. The Servicer may elect not to make
any Advance with respect to a Receivable to the extent
that the Servicer, in its sole discretion, determines
that such Advance is not recoverable from subsequent
payments on such Receivable or from funds on deposit in
the Reserve Account. See 'Description of the Pooling
and Servicing Agreement--Advances' herein.
SERVICING FEE........... The Servicer shall receive a Servicing Fee for each
Collection Period, payable on each Distribution Date,
in an amount equal to the sum of (i) the product of
one-twelfth of the Servicing Fee Rate and the Pool
Balance as of the close of business on related
Settlement Date and (ii) any Late Fees paid by the
Obligors during the related Collection Period. A
'SETTLEMENT DATE' with respect to any Distribution
Date, the last day of the second Collection Period
preceding the Collection Period in which such
Distribution Date occurs. A 'COLLECTION PERIOD' with
respect to a Distribution Date will be the calendar
month preceding the calendar month in which such
Distribution Date occurs. In addition, the Servicing
Fee will include Investment Earnings on amounts on
deposit in the Collection Account; provided, however,
that from and after the Collection Period in which the
Servicer fails to deposit an Advance with respect to a
Receivable (other than because such Receivable has been
declared a Defaulted Receivable), such Investment
Earnings will not be paid to the Servicer but will
instead be deposited in the Reserve Account to be
applied pursuant to the Agreement. See 'Description of
the Pooling and Servicing Agreement-- Servicing
Compensation and Payment of Expenses' herein and
'Description of the Transfer and Servicing
Agreements--Servicing Compensation and Payment of
Expenses' and '--Net Deposits' in the Prospectus.
THE RECEIVABLES......... The Receivables will consist of retail installment
sales contracts and purchase money notes and other
notes secured by new and used automobiles and light-
duty trucks (the 'FINANCED VEHICLES'). On the Closing
Date, the Seller will transfer Receivables having an
aggregate principal balance of approximately $ as
of the Cutoff Date to the Trust in exchange for the
Securities pursuant to the Agreement. See 'Description
of the Pooling and Servicing Agreement' herein and
'Description of the Transfer and Servicing Agreements'
in the Prospectus.
The Receivables have been selected from the contracts
owned by the Bank based on the criteria specified in
the Agreement and described herein and in the
Prospectus. See 'The Receivables Pool' herein and 'The
Receivables Pools' in the Prospectus. No Receivable
will have a scheduled maturity that, after giving
prospective effect to any permitted extensions or
deferrals, would be later than (the 'FINAL
SCHEDULED MATURITY DATE'). As of the Cutoff Date, the
weighted average remaining maturity of the Receivables
was approximately months and the weighted average
original maturity of the Receivables was approximately
months.
</TABLE>
S-3
<PAGE>
<TABLE>
<S> <C>
As of the Cutoff Date, approximately % of the
Original Pool Balance were secured by used Financed
Vehicles and the remainder were secured by new Financed
Vehicles.
The 'POOL BALANCE' at any time will represent the
aggregate principal balance of the Receivables as of
the close of business on the last day of the preceding
Collection Period, after giving effect to all payments
received from Obligors and Repurchase Amounts to be
remitted by the Servicer or the Seller, as the case may
be, for such Collection Period and all losses realized
on Receivables liquidated during such Collection
Period. The aggregate principal balance of the
Receivables as of the Cutoff Date (the 'ORIGINAL POOL
BALANCE') was $ .
RESERVE ACCOUNT......... A reserve account (the 'RESERVE ACCOUNT') will be
established by the Seller and maintained by the
Collateral Agent with an initial deposit of cash or
Permitted Investments having an aggregate value of
$ ( % of the Original Pool Balance) (the
'RESERVE ACCOUNT INITIAL DEPOSIT'). In addition, on
each Distribution Date, any amounts on deposit in the
Collection Account with respect to the preceding
Collection Period after payments to the Servicer and
deposits to the Distribution Accounts have been made
will be deposited into the Reserve Account. On each
Distribution Date, any amounts on deposit in the
Reserve Account in excess of the Specified Reserve
Account Balance (as defined below) will be distributed
to the Seller.
On or prior to each Deposit Date, the Trustee will
withdraw funds from the Reserve Account to the extent
of the funds therein, (i) to the extent required to
reimburse the Servicer for Advances previously made and
not reimbursed ('OUTSTANDING ADVANCES') as provided in
the Agreement and (ii) to the extent (x) the sum of the
amounts required to be distributed to the Servicer and
Certificateholders on the related Distribution Date
exceeds the sum of Available Interest and Available
Principal for such Distribution Date. See 'Description
of the Certificates--Reserve Account' herein. If the
amount in the Reserve Account is reduced to zero and,
in the case of the Class A Certificateholders, if the
subordination of the Class B Certificates is
insufficent, Certificateholders will bear directly the
credit and other risks associated with ownership of the
Receivables, including the risk that the Trust may not
have a perfected security interest in the Financed
Vehicles. See 'Certain Legal Aspects of the
Receivables' in the Prospectus.
SPECIFIED RESERVE
ACCOUNT BALANCE....... On any Distribution Date, the specified reserve account
balance (the 'SPECIFIED RESERVE ACCOUNT BALANCE') will
equal % ( % under certain circumstances
described herein) of the Pool Balance as of the related
Settlement Date, but in any event not less than the
lesser of (i) $ ( % of the Original Pool
Balance) and (ii) the sum of (A) such Pool Balance and
(B) an amount sufficient to pay interest on such Pool
Balance through the Final Scheduled Distribution Date
at a rate equal to the sum of (x) the weighted average
of the Class A Pass-Through Rate and the Class B
Pass-Through Rate (based on their respective
Certificate Balances) plus (y) the Servicing Fee Rate.
The Specified Reserve Account Balance may be reduced to
a lesser amount as determined by the Seller, provided
that such reduction does not adversely affect the
rating of any class of Certificates by a Rating Agency.
OPTIONAL PURCHASE....... The Servicer may purchase all the Receivables on any
Distribution Date following the last day of any
Collection Period as of which the Pool Balance has
declined to 5% or less of the Original Pool Balance at
a purchase price equal to the aggregate of the
Repurchase Amounts of the then outstanding Receivables.
</TABLE>
S-4
<PAGE>
<TABLE>
<S> <C>
See 'Description of the Transfer and Servicing
Agreements--Termination' in the Prospectus.
TRUSTEE................. The Trustee's Corporate Trust Office is located at
, telephone
. The Bank and its affiliates may have
normal banking relationships with the Trustee and its
affiliates.
COLLATERAL AGENT........
TAX STATUS.............. Upon the issuance of the Certificates, Simpson Thacher
& Bartlett, special counsel to the Seller, will deliver
its opinion generally to the effect that under current
law the Trust will be treated as a grantor trust for
United States federal income tax purposes and not as an
association taxable as a corporation for United States
federal income tax purposes. Certificateholders must
report their respective allocable shares of income
earned on Trust assets and, subject to certain
limitations applicable to individuals, estates and
trusts, may deduct their respective allocable shares of
reasonable servicing and other fees paid or incurred by
the Trust. See 'Certain Federal Income Tax
Consequences' and 'Certain State Tax Consequences'
herein.
ERISA CONSIDERATIONS.... The Class A Certificates may, in general, be purchased
by Plans that are subject to ERISA or Section 4975 of
the Code, and by persons investing Plan Assets of any
Plan, upon satisfaction of certain conditions described
herein.
Because the Class B Certificates are subordinated to
the Class A Certificates, the Class B Certificates may
not be acquired by, on behalf of, or with, Plan Assets
of any Plan. The foregoing restriction shall not apply
to acquisitions of the Class B Certificates with assets
of the general account of an insurance company if the
conditions set forth in Sections I and III of U.S.
Department of Labor Prohibited Transaction Class
Exemption 95-60 are satisfied.
See 'ERISA Considerations' herein and in the
Prospectus.
RATINGS................. It is a condition of issuance of the Certificates that
the Class A Certificates be rated in the highest
long-term rating category, by at least two nationally
recognized statistical rating organizations (each, a
'RATING AGENCY'), and that the Class B Certificates be
rated at least in the ' ' category, or its equivalent,
by at least two Rating Agencies. There can be no
assurance that any rating will not be lowered or
withdrawn if, in the sole judgment of the related
Rating Agency, circumstances in the future so warrant.
See 'Risk Factors--Ratings of the Certificates' herein.
[LISTING................ Application will be made to list the Certificates on
the Luxembourg Stock Exchange.]
</TABLE>
S-5
<PAGE>
RISK FACTORS
Investors should consider, among other things, the matters discussed under
'Risk Factors' in the Prospectus and the following risk factors in connection
with purchases of Certificates.
LIMITED LIQUIDITY
There is currently no secondary market for the Class A Certificates or the
Class B Certificates. The Underwriters currently intend to make a market in the
Certificates offered hereby, but none of them are under any obligation to do so.
There can be no assurance that a secondary market will develop or, if a
secondary market does develop, that it will provide the Certificateholders with
liquidity of investment or that it will continue for the life of the Class A
Certificates or Class B Certificates, as the case may be.
TRUST'S RELATIONSHIP TO THE SELLER AND THE SERVICER
Neither the Seller nor the Servicer is generally obligated to make any
payments in respect of the Certificates or the Receivables. In addition, if the
Bank were to cease acting as Servicer, delays in processing payments on the
Receivables and information in respect thereof could occur and result in delays
in payments to the Certificateholders. See 'Description of the Transfer and
Servicing Agreements--Sale and Assignment of Receivables' in the Prospectus.
SUBORDINATION; LIMITED ASSETS
The Trust will not have, nor is it permitted to have, any significant
assets or sources of funds other than the Receivables and the right to receive
payments under certain circumstances from the Reserve Account. The Certificates
represent interests solely in the Trust. Consequently, Certificateholders must
rely for repayment upon payments on the Receivables and, if and to the extent
available, amounts on deposit in the Reserve Account. However, the amounts
deposited in the Reserve Account are limited in amount and the amount required
to be maintained on deposit therein will be reduced as the Pool Balance
declines. If the amount on deposit in the Reserve Account is exhausted, and in
the case of the Class A Certificateholders, if the subordination of the Class B
Certificates is insufficient, the Trust will depend solely on current
distributions on the Receivables to make payments on the Certificates. The
Certificates will not be insured or guaranteed by the Bank, the Servicer, the
Trustee or any affiliate thereof.
The rights of the Class B Certificateholders to receive payments of
principal will be subordinated to the rights of the Class A Certificateholders
to receive payments of interest and principal to the extent described herein.
The Class B Certificateholders will not receive any distributions of interest
with respect to a Collection Period until the full amount of interest on the
Class A Certificates relating to such Collection Period has been deposited in
the Class A Distribution Account. The Class B Certificateholders will not
receive any distributions of principal with respect to such Collection Period
until the full amount of interest on and principal of the Class A Certificates
relating to such Collection Period has been deposited in the Class A
Distribution Account. However, distributions of interest on the Class B
Certificates, to the extent of collections on the Receivables allocable to
interest and the amounts on deposit in the Reserve Account available after the
payment of interest on the Class A Certificates has been made, will not be
subordinated to the payment of principal on the Class A Certificates. See
'Description of the Certificates--Distributions on Certificates' herein.
RATINGS OF THE CERTIFICATES
It is a condition to the issuance of the Certificates that the Class A
Certificates be rated in the highest long-term rating category by at least two
Rating Agencies, and that the Class B Certificates be rated at least in the ' '
category, or its equivalent, by at least two Rating Agencies. A rating is not a
recommendation to purchase, hold or sell Certificates, inasmuch as such rating
does not comment as to market price or suitability for a particular investor.
The ratings of the Certificates address the likelihood of the timely payment of
interest on and the ultimate payment of principal of the Certificates pursuant
to their terms. There can be no assurance that a rating will remain for any
given period of time or that a rating will not be lowered or withdrawn entirely
if, in the sole judgment of a Rating Agency, circumstances in the future so
warrant.
S-6
<PAGE>
FEDERAL INCOME TAXATION; EFFECT OF SUBORDINATION ON CLASS B CERTIFICATEHOLDERS
It is expected that, for U.S. federal income tax purposes, amounts
otherwise payable to the Class B Certificateholders that are paid to the Class A
Certificateholders pursuant to the subordination provisions described above
under '--Subordination; Limited Assets' will be deemed to have been received by
the Class B Certificateholders and then paid by them to the Class A
Certificateholders pursuant to a guaranty. See generally 'Certain Federal Income
Tax Consequences' herein.
If the Class B Certificateholders received distributions of less than their
share of the Trust's receipts of principal or interest (the 'SHORTFALL AMOUNT')
because of the subordination of the Class B Certificates, holders of Class B
Certificates would probably be treated for U.S. federal income tax purposes as
if they had (i) received as distributions their full share of such receipts,
(ii) paid over to the Class A Certificateholders an amount equal to such
Shortfall Amount, and (iii) retained the right to reimbursement of such amounts
to the extent of future collections otherwise available for deposit in the
Reserve Account.
Under this analysis, (i) Class B Certificateholders would be required to
accrue as current income any interest or OID income of the Trust that was a
component of the Shortfall Amount, even though such amount was in fact paid to
the Class A Certificateholders, (ii) a loss would only be allowed to the Class B
Certificateholders when their right to receive reimbursement of such Shortfall
Amount became worthless (i.e., when it becomes clear that amounts will not be
available from any source to reimburse such loss), and (iii) reimbursement of
such Shortfall Amount prior to such a claim of worthlessness would not be
taxable income to Class B Certificateholders because such amount was previously
included in income. Those results should not significantly affect the inclusion
of income for Class B Certificateholders on the accrual method of accounting,
but could accelerate inclusion of income to Class B Certificateholders on the
cash method of accounting by, in effect, placing them on the accrual method.
Moreover, the character and timing of loss deductions is unclear.
THE TRUST
The Seller will establish the Trust by selling and assigning the Trust
property, as described below, to the Trustee in exchange for the Certificates.
Each Certificate will represent a fractional undivided interest in the Trust.
The Trust property will include a pool (the 'RECEIVABLES POOL') comprised of the
Receivables and all payments received thereunder on or after the Cutoff Date
(other than Retained Yield). The Trust property will also include (i) such
amounts as from time to time may be held in the Collection Account and the
Distribution Accounts established and maintained by the Servicer in the name of
the Trustee pursuant to the Agreement; (ii) security interests in the vehicles
securing the Financed Vehicles; (iii) the rights to proceeds as a result of the
Seller's exercise of its recourse rights against Dealers (as described in the
Prospectus under 'The Receivables Pools--Origination and Servicing of Motor
Vehicle Loans'); (iv) an assignment of the rights of the Seller to receive
proceeds from claims on theft and physical damage, credit life and credit
disability insurance policies covering the Financed Vehicles or the Obligors,
as the case may be, to the extent that such insurance policies relate to the
Receivables; (v) the rights with respect to any Financed Vehicle that has been
repossessed by the Servicer, on behalf of the Trustee and (vi) any and all
proceeds of the foregoing. The Retained Yield and the Reserve Account, and any
amounts therein, will not be property of the Trust, but will be pledged to and
held by the Collateral Agent, as secured party for the benefit of the
Certificateholders.
The Agreement sets forth criteria that must be satisfied by each
Receivable. See 'Description of the Transfer and Servicing Agreements--Sale and
Assignment of Receivables' in the Prospectus. Each Receivable will be identified
in a schedule appearing as an exhibit to the Agreement.
The Trust will be formed for this transaction pursuant to the Agreement and
prior to formation will have had no assets or obligations. After formation, the
Trust will not engage in any activity other than acquiring and holding the
Receivables, issuing the Certificates, distributing payments thereon and as
otherwise described herein and as provided in the Agreement. The Trust will not
acquire any contracts or assets other than the Trust property described above
and will not have any need for additional capital resources. As the Trust does
not have any operating history and will not engage in any activity other than
issuing the Certificates and making distributions thereon, there has not been
included any historical or pro forma financial statements or ratio of earnings
to fixed charges with respect to the Trust. Inasmuch as the Trust has no
operating history, it is not possible to predict the
S-7
<PAGE>
operating performance of the Trust while the Certificates are outstanding. While
management of the Seller believes that the loss and delinquency experience
contained herein for recent periods are representative of past performance of
Motor Vehicle Loans in the Chase Auto Finance Portfolio, there is no assurance
that such performance is indicative of the future performance of the
Receivables, since future performance is dependent, among other things, on
general economic conditions and economic conditions in the geographical areas in
which the Obligors reside (including, for example, unemployment rates).
THE RECEIVABLES POOL
The Receivables represent Motor Vehicle Loans from the portfolio of the
Seller that, in addition to satisfying the criteria set forth in the Prospectus
under 'The Receivables Pools--General':
(a) have a remaining maturity, as of the Cutoff Date, of at least
months and not more than months;
(b) are secured by new Financed Vehicles that had an original maturity
of at least months and not more than months, or by used Financed
Vehicles that had an original maturity of at least months and not more
than months;
(c) are fully-amortizing fixed rate simple interest contracts that
provide for level scheduled monthly payments over their respective
remaining terms and have an annual contract rate of interest (a 'CONTRACT
RATE') of at least % and not more than %;
(d) have remaining principal balances, as of the Cutoff Date, of at
least $ and not greater than $ ;
(e) have no payment that is delinquent for more than 30 days past due
as of the Cutoff Date; and
(f) are not Motor Vehicle Loans (i) whose related Obligor resides in
the State of Alabama (in the case of Direct Receivables) or (ii) originated
by or through a Dealer located in the State of Alabama (in the case of
Receivables which are not Direct Receivables) or Motor Vehicle Loans the
subject of a previous securitization.
The Receivables were selected from the Motor Vehicle Loans in the portfolio
of the Seller that met the above criteria. For administrative reasons, the
Seller selected from the Motor Vehicle Loans in its portfolio all otherwise
eligible Motor Vehicle Loans originated since , 199 , which were
segregated and held for sale by the Seller. The Seller believes that such
selection procedures are not materially adverse to Certificateholders.
Approximately % of the Original Pool Balance were secured by new Financed
Vehicles, and approximately % of the Original Pool Balance were secured by
used Financed Vehicles. All of the Receivables were Simple Interest Receivables.
An insignificant number of the Receivables provide for recourse to the Dealer in
the event of default by the Obligor.
Approximately % of the Original Pool Balance were made directly by the
Originating Bank to Obligors without involvement of Dealers (collectively, the
'DIRECT RECEIVABLES') using the Chase Auto Finance criteria and have been
serviced consistent with Chase Auto Finance's servicing policies and practices.
The Direct Receivables originated by Chase, as Originating Bank, will be
transferred to the Seller on or prior to the Closing Date.
The Seller may not substitute other Motor Vehicle Loans from its portfolio,
or any other motor vehicle receivables, for the Receivables at any time during
the term of the Agreement. See 'The Receivables Pools--General' and 'Weighted
Average Life of the Securities' in the Prospectus for a description of how
prepayments made under Simple Interest Receivables are allocated.
The composition of the Receivables, distribution by Contract Rate of the
Receivables and the geographic distribution of the Receivables, in each case as
of the Cutoff Date, are set forth in the following tables.
S-8
<PAGE>
COMPOSITION OF THE RECEIVABLES
<TABLE>
<CAPTION>
NEW FINANCED VEHICLES USED FINANCED VEHICLES TOTAL
--------------------- ---------------------- -----------------
<S> <C> <C> <C>
Aggregate Principal Balance....... $ $ $
Number of Receivables.............
Average Principal Balance......... $ $ $
Average Original Balance.......... $ $ $
Weighted Average Contract Rate.... % % %
Contract Rate (Range)............. % to % % to % % to %
Weighted Average Original Term.... months months months
Original Term (Range)............. to months to months to months
Weighted Average Remaining Term... months months months
Remaining Term (Range)............ to months to months to months
</TABLE>
DISTRIBUTION BY CONTRACT RATE OF THE RECEIVABLES
<TABLE>
<CAPTION>
PERCENT OF
NUMBER OF ORIGINAL
CONTRACT RATE RANGE RECEIVABLES PRINCIPAL BALANCE POOL BALANCE
- - - ---------------------- ----------- ----------------- ----------------
<S> <C> <C> <C>
% to below %............... $ %
% to below %............... %
% to below %............... %
% to below %............... %
% to below %............... %
% to below %............... %
% to below %............... %
% to below %............... %
% to below %............... %
% to below %............... %
% to below %............... %
% to below %............... %
% to below %............... %
% to below %............... %
% to below %............... %
% to below %............... %
% to below %............... %
% to below %............... %
% to below %............... %
% to below %............... %
% to below %............... %
% to below %............... %
% to below %............... %
% to below %............... %
% to below %............... %
% to below %............... %
----------- ----------------- -------
Total (1)............. $ 100.00%
----------- ----------------- -------
----------- ----------------- -------
</TABLE>
- - - ------------------------
(1) Dollar amounts and percentages may not add to the total or to 100.00%,
respectively, due to rounding.
S-9
<PAGE>
GEOGRAPHIC DISTRIBUTION OF THE RECEIVABLES
<TABLE>
<CAPTION>
PERCENT OF
NUMBER OF ORIGINAL
STATE RECEIVABLES PRINCIPAL BALANCE POOL BALANCE
- - - ----------------------- ----------- ----------------- ----------------
<S> <C> <C> <C>
Arizona................ $ %
Arkansas...............
California.............
Colorado...............
Connecticut............
Delaware...............
District of Columbia...
Florida................
Georgia................
Hawaii.................
Idaho..................
Illinois...............
Indiana................
Iowa...................
Kansas.................
Kentucky...............
Louisiana..............
Maine..................
Maryland...............
Massachusetts..........
Michigan...............
Minnesota..............
Mississippi............
Missouri...............
Montana................
Nebraska...............
Nevada.................
New Hampshire..........
New Jersey.............
New Mexico.............
New York...............
North Carolina.........
North Dakota...........
Ohio...................
Oklahoma...............
Oregon.................
Pennsylvania...........
Rhode Island...........
South Carolina.........
South Dakota...........
Tennessee..............
Texas..................
Utah...................
Vermont................
Virginia...............
Washington.............
West Virginia..........
Wisconsin..............
Wyoming................
----------- ----------------- -------
Total(1)............... $ 100.00%
----------- ----------------- -------
----------- ----------------- -------
</TABLE>
(Footnotes on next page)
S-10
<PAGE>
(Footnotes from previous page)
- - - ------------------
(1) Based on location of the related Obligor (in the case of Direct
Receivables) or the Dealer from which the related Motor Vehicle Loan was
acquired or through which it was made (in the case of Receivables which are
not Direct Receivables).
(2) Dollar amounts and percentages may not add to the total or to 100.00%,
respectively, due to rounding.
DELINQUENCY AND LOAN LOSS INFORMATION
The following tables set forth information with respect to delinquencies,
loan losses and recoveries for the Chase Auto Finance Portfolio as of the dates
indicated and for each of the one year periods ended December 31, 199 , 199 ,
199 , 199 and 199 . The portions of the Chase Auto Finance Portfolio that
provide for payments based upon variable rate simple interest and the actuarial
method are included in the following tables, but Motor Vehicle Loans of such
types are not included in the Trust. Chase Auto Finance does not maintain
separate records that distinguish among the delinquency and loan loss experience
for Motor Vehicle Loans that provide for payments based upon fixed rate simple
interest (such as the Receivables), variable rate simple interest and the
actuarial method. The Seller believes, however, that the delinquency and loan
loss experience with respect to the fixed rate simple interest Motor Vehicle
Loans included in the Trust is not materially different from the performance of
the Chase Auto Finance Portfolio set forth below.
Approximately % of the Original Pool Balance were Direct Receivables.
The delinquency and loan loss experience for Direct Receivables are not included
in the performance of the Chase Auto Finance Portfolio set forth below. The
Seller believes that the delinquency and loan loss experience for Direct
Receivables has not been materially different from the performance of the Chase
Auto Finance Portfolio set forth below.
See 'The Receivables Pools--General' and '--Delinquency and Loan Loss
Information' in the Prospectus for a description of the composition of the Chase
Auto Finance Portfolio.
The data presented in the following tables are for illustrative purposes
only. Delinquency and loan loss experience may be influenced by a variety of
economic, social and other factors. No assurance can be given that the
delinquency and loan loss information of the Bank, or of the Trust with respect
to the Receivables, in the future will be similar to that set forth below.
S-11
<PAGE>
DELINQUENCY EXPERIENCE(1)(2)
<TABLE>
<CAPTION>
AS OF DECEMBER 31,
-----------------------------------------------------------------
199 199 199
------------------- -------------------- --------------------
NUMBER NUMBER NUMBER
DOLLARS OF DOLLARS OF DOLLARS OF
(000'S) LOANS (000'S) LOANS (000'S) LOANS
---------- ------- ---------- ------- ---------- -------
<S> <C> <C> <C> <C> <C> <C>
Outstanding Principal
Amount.................... $ $ $
---------- ------- ---------- ------- ---------- -------
---------- ------- ---------- ------- ---------- -------
Delinquencies(3)(4)
30-59 Days................ $ $ $
60-89 Days................
90 Days or More...........
---------- ------- ---------- ------- ---------- -------
---------- ------- ---------- ------- ---------- -------
TOTAL Delinquencies......... $ $ $
Repossession Inventory(5)...
---------- ------- ---------- ------- ---------- -------
---------- ------- ---------- ------- ---------- -------
TOTAL Delinquencies &
Repossession Inventory.... $ $ $
---------- ------- ---------- ------- ---------- -------
---------- ------- ---------- ------- ---------- -------
Delinquencies(3)(4)(6)
30-59 Days................ % % %
60-89 Days................ % % %
90 Days or More........... % % %
---------- ---------- ----------
TOTAL Delinquencies(6)(7)... % % %
Repossession Inventory(6)... % % %
---------- ---------- ----------
TOTAL Delinquencies &
Repossession
Inventory(6)(7)........... % % %
---------- ---------- ----------
---------- ---------- ----------
<CAPTION>
199 199
------------------- --------------------
NUMBER NUMBER
DOLLARS OF DOLLARS OF
(000'S) LOANS (000'S) LOANS
---------- ------- ---------- -------
<S> <C> <C> <C> <C>
Outstanding Principal
Amount.................... $ $
---------- ------- ---------- -------
---------- ------- ---------- -------
Delinquencies(3)(4)
30-59 Days................ $ $
60-89 Days................
90 Days or More...........
---------- ------- ---------- -------
---------- ------- ---------- -------
TOTAL Delinquencies......... $ $
Repossession Inventory(5)...
---------- ------- ---------- -------
---------- ------- ---------- -------
TOTAL Delinquencies &
Repossession Inventory.... $ $
---------- ------- ---------- -------
---------- ------- ---------- -------
Delinquencies(3)(4)(6)
30-59 Days................ % %
60-89 Days................ % %
90 Days or More........... % %
---------- ----------
TOTAL Delinquencies(6)(7)... % %
Repossession Inventory(6)... % %
---------- ----------
TOTAL Delinquencies &
Repossession
Inventory(6)(7)........... % %
---------- ----------
---------- ----------
</TABLE>
- - - ------------------
(1) The delinquency experience presented does not include experience with
respect to Direct Receivables.
(2) As of December 31, 199 , approximately % of the aggregate principal
balance of Motor Vehicle Loans in the portfolio presented were Chase
Maryland Loans.
(3) Delinquencies include principal amounts only.
(4) The period of delinquency is based on the number of days payments are
contractually past due.
(5) As of December 31, 1994 and earlier, amounts shown in repossession inventory
represent loans which have been written down to the fair market value of the
collateral, but where the related financed vehicles have not yet been sold.
As of December 31, 1995 and later, the amounts shown in repossession
inventory represent the total outstanding principal balance of the loans at
such times.
(6) As a percent of outstanding principal in dollars.
(7) Percentages representing TOTAL Delinquencies and Repossession Inventory may
not add to the components thereof due to rounding.
S-12
<PAGE>
LOAN LOSS EXPERIENCE(1)(2)
(DOLLARS IN 000'S)
<TABLE>
<CAPTION>
YEAR ENDED
----------------------------------------------------------------------------
DECEMBER 31, DECEMBER 31, DECEMBER 31, DECEMBER 31, DECEMBER 31,
199 199 199 199 199
------------ ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C>
Number of Loans(3)...........................
Period End Outstanding Principal Amount...... $ $ $ $ $
Average Outstanding Principal Amount(4)...... $ $ $ $ $
Number of Repossessions......................
Number of Gross Charge-Offs..................
Gross Charge-Offs(5)......................... $ $ $ $ $
Gross Charge-Offs as a % of Period End
Outstanding Principal Amount(5)............ % % % % %
Gross Charge-Offs as a % of Average
Outstanding Principal Amount(5)............ % % % % %
Recoveries(6)................................ $ $ $ $ $
Net Charge-Offs(7)........................... $ $ $ $ $
Net Charge-Offs as a % of Period End
Outstanding Principal Amount(7)............ % % % % %
Net Charge-Offs as a % of Average Outstanding
Principal Amount(7)........................ % % % % %
</TABLE>
- - - ------------------
(1) The loan loss experience presented does not include experience with respect
to Direct Receivables.
(2) As of December 31, 199 , approximately % of the aggregate principal
balance of Motor Vehicle Loans in the portfolio presented were Chase
Maryland Loans.
(3) Number of loans as of period end.
(4) The average for 1992 was computed by taking the simple average of month end
outstanding principal amounts for the year, and the average for each other
period presented was computed by taking the simple average of monthly
average outstanding principal amounts for such period.
(5) Amount charged off is remaining principal balance less proceeds from sale of
repossessed vehicles.
(6) Recoveries generally include amounts received with respect to loans
previously charged-off, except for proceeds realized in connection with the
sale of the repossessed vehicles.
(7) Net Charge-Offs mean gross charge-offs minus recoveries of loans previously
charged-off. Net charge-offs may not equal the difference of the components
thereof due to rounding.
S-13
<PAGE>
CHASE USA
Information regarding the Seller and the Servicer is set forth under 'Chase
USA' in the Prospectus. At , 199 , Chase USA's total assets were
approximately $ billion, total liabilities were approximately $ billion, and
total stockholders' equity was approximately $ billion.
USE OF PROCEEDS
After the deposit of the Reserve Account Initial Deposit and the deduction
of estimated expenses, the net proceeds to be received by the Seller from the
sale of the Certificates will be added to its general funds.
WEIGHTED AVERAGE LIFE OF THE CERTIFICATES
Information regarding certain maturity and prepayment considerations with
respect to the Certificates is set forth under 'Weighted Average Life of the
Securities' in the Prospectus.
YIELD CONSIDERATIONS
On each Distribution Date, interest on the Certificates at the applicable
Pass-Through Rate will be distributed on the Class A Certificate Balance and the
Class B Certificate Balance, respectively, in each case as of the prior
Distribution Date (after giving effect to any payments made on such immediately
prior Distribution Date). In the event of a principal prepayment on a
Receivable, Certificateholders will generally receive their pro rata share of
interest for the full Collection Period with respect to the unpaid principal
balance of such Receivable as of the first day of such Collection Period to the
extent that amounts on deposit in the Collection Account and in the Reserve
Account are available for such purposes. If the Reserve Account is exhausted and
losses on the Receivables occur, the amount of interest distributed to the Class
B Certificateholders may be less than described above. See 'Description of the
Certificates--Distributions on Certificates' herein.
Chase Auto Finance maintains limited records of the historical prepayment
experience of certain portions of the Chase Auto Finance Portfolio. The Seller
believes that such records are not adequate to provide meaningful information
with respect to the Receivables. In any event, no assurance can be given that
prepayments on the Receivables would conform to any historical experience, and
no prediction can be made as to the actual prepayment experience to be expected
with respect to the Receivables.
Although the Receivables have different Contract Rates, each Receivable's
Contract Rate is required to equal at least the sum of (x) the weighted average
of the Class A Pass-Through Rate and the Class B Pass-Through Rate (based on
their respective Certificate balances) and (y) the Servicing Fee Rate.
Therefore, disproportionate rates of prepayments between Receivables with higher
and lower Contract Rates will not affect the yield to Certificateholders.
DESCRIPTION OF THE CERTIFICATES
GENERAL
The Certificates offered hereby will be issued pursuant to the Agreement, a
form of which has been filed as an exhibit to the Registration Statement. A copy
of the Agreement will be filed with the Commission following the issuance of the
Certificates. The following, as well as other pertinent information included
elsewhere in this Prospectus Supplement and the Prospectus, summarizes the
material terms of the Certificates and the Agreement. The following summary does
not purport to be complete and is subject to, and qualified in its entirety by
reference to, the Agreement. The following summary supplements the description
of the general terms and provisions of the Certificates of any given series and
the related Pooling and Servicing Agreement set forth in the Prospectus, to
which description reference is hereby made.
The Certificates will constitute Fixed Rate Securities, as such term is
defined under 'Certain Information Regarding the Securities--Fixed Rate
Securities' in the Prospectus. The Certificates will evidence undivided
ownership interests in the Trust created pursuant to the Agreement. The Class A
Certificates will evidence in the
S-14
<PAGE>
aggregate an undivided ownership interest of the Class A Percentage of the Trust
and the Class B Certificates will evidence in the aggregate an undivided
ownership interest of the Class B Percentage of the Trust. In general, it is
intended that the Class A Certificateholders receive, on each Distribution Date,
the Class A Percentage of the amounts allocable to the principal balance of the
Receivables for the related Collection Period plus one-month's interest at the
Class A Pass-Through Rate on the Class A Certificate Balance. Subject to the
prior rights of the Class A Certificateholders, it is intended that the Class B
Certificateholders receive, on each Distribution Date, the Class B Percentage of
the amounts allocable to the principal balance of the Receivables for the
related Collection Period plus one-month's interest at the Class B Pass-Through
Rate on the Class B Certificate Balance. Distributions to the Class A
Certificateholders and Class B Certificateholders will only be made to the
extent that sufficient funds are available in the Collection Account and the
Reserve Account to make such distributions. See '--Distributions on
Certificates' herein.
Principal and interest to Certificateholders may be provided by payments
made by or on behalf of the Obligors, Advances or draws from the Reserve
Account. A prepayment of a Receivable may be made by or on behalf of an Obligor,
by application of insurance proceeds, as a result of a repurchase made by the
Seller or purchase made by the Servicer under the circumstances specified in the
Agreement, or, by foreclosure upon the related Financed Vehicle or other
enforcement measures taken with respect to a Receivable that is delinquent prior
to its being designated a Defaulted Receivable and the realization of
liquidation proceeds with respect thereto. See '--Reserve Account' herein and
'Description of the Transfer and Servicing Agreements--Sale and Assignment of
Receivables' and '--Servicing Procedures' in the Prospectus.
Distributions of principal of and interest on the Certificates with respect
to each Collection Period will be made by, or on behalf of, the Trustee on the
Distribution Date immediately succeeding such Collection Period, commencing
, 199 . Each Collection Period will be one calendar month.
DENOMINATIONS AND REGISTRATION OF CERTIFICATES
The Certificates will be offered for purchase in denominations of $1,000
and integral multiples thereof and will initially be represented by Certificates
registered in the name of the nominee of DTC except as provided in the
Prospectus. The Seller has been informed by DTC that DTC's nominee will be Cede.
See 'Certain Information Regarding the Securities--Book-Entry Registration' and
'--Definitive Securities' in the Prospectus.
TRUST ACCOUNTS
The Servicer will establish and maintain a segregated account (the
'COLLECTION ACCOUNT'), in the name of the Trustee on behalf of the
Certificateholders, into which all payments made on or with respect to the
Receivables will be deposited. The Servicer will also establish and maintain a
segregated distribution account in the name of the Trustee on behalf of the
Class A Certificateholders (the 'CLASS A DISTRIBUTION ACCOUNT') and a segregated
distribution account in the name of the Trustee on behalf of the Class B
Certificateholders (the 'CLASS B DISTRIBUTION ACCOUNT,' and together with the
Class A Distribution Account, the 'DISTRIBUTION ACCOUNTS'). The Collection
Account and each Distribution Account will be an Eligible Deposit Account as
described under 'Description of the Transfer and Servicing Agreements--Accounts'
in the Prospectus. The Collection Account and each Distribution Account will be
established initially with the trust department of The Chase Manhattan Bank
('CHASE'). Chase, in its capacity as the initial paying agent (the 'PAYING
AGENT'), will have the revocable right to withdraw funds from each Distribution
Account for the purpose of making distributions to Certificateholders in the
manner provided in the Agreement.
RESERVE ACCOUNT
The Reserve Account will be established with an initial deposit by the
Seller of the Reserve Account Initial Deposit. In addition, on each Distribution
Date, any amounts on deposit in the Collection Account with respect to the
preceding Collection Period after payments to the Servicer and deposits to the
Distribution Accounts have been made will be deposited into the Reserve Account.
The Reserve Account will be an Eligible Deposit Account which shall be
established by the Servicer and maintained in the name of, and under the control
of, the Collateral Agent. Funds on deposit in the Reserve
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Account will be invested in Permitted Investments selected by the Seller
maturing not later than the next Deposit Date, except if the Reserve Account is
maintained with the Trustee, for investments on which the Trustee is the
obligor, which investments may mature on the next succeeding Distribution Date;
provided, that such Permitted Investments may mature later than such next
Deposit Date to the extent that such investments do not adversely affect any
rating of the Certificates by a Rating Agency. The Reserve Account and any
amounts therein will not be property of the Trust, but will be pledged to and
held for the benefit of the Collateral Agent, as secured party for the benefit
of Certificateholders. See 'Description of the Transfer and Servicing
Agreements--Accounts' in the Prospectus.
On each Distribution Date, the amount available in the Reserve Account (the
'AVAILABLE RESERVE ACCOUNT AMOUNT') will equal the lesser of (i) the amount on
deposit in the Reserve Account (exclusive of Investment Earnings) and (ii) the
Specified Reserve Account Balance.
On each Deposit Date, the Trustee shall demand a withdrawal from the
Reserve Account in an amount equal to the sum of (i) the excess, if any, of the
sum of the amounts required to be distributed to Certificateholders and the
Servicing Fee payable to the Servicer on such Distribution Date over the sum of
Available Interest and Available Principal for such Distribution Date (net of
amounts to be applied in reimbursement of outstanding Advances) ('PAYMENT
DEFICIENCIES') and (ii) the amount of any outstanding Advances of interest
accrued on Defaulted Receivables to the extent not recovered from Liquidation
Proceeds. Such Payment Deficiencies may result from, among other things,
realized losses on Receivables, the failure by the Servicer to make any
remittance required to be made under the Agreement or the election of the
Servicer not to make any Advance. The aggregate amount withdrawn from the
Reserve Account on any Deposit Date will not exceed the Available Reserve
Account Amount with respect to the related Distribution Date. The Trustee will
deposit the proceeds of such withdrawals into the Collection Account.
The Specified Reserve Account Balance on any Distribution Date will equal
% of the Pool Balance as of the related Settlement Date, but in any event
will not be less than the lesser of (i) $ and (ii) the sum of such
Pool Balance plus an amount sufficient to pay interest on such Pool Balance
through the Final Scheduled Distribution Date at a rate equal to the sum of (x)
the weighted average of the Class A Pass-Through Rate and the Class B
Pass-Through Rate (based on their respective Certificate Balances) and (y) the
Servicing Fee Rate; provided that the Specified Reserve Account Balance will be
calculated using a percentage of % for any Distribution Date (beginning
with the , 199 Distribution Date) on which the Average Net Loss
Ratio exceeds % or the Average Delinquency Percentage exceeds %.
'AGGREGATE NET LOSSES' means the amount equal to (i) the aggregate
principal balance of the Receivables that became Defaulted Receivables
during the related Collection Period minus (ii) the Liquidation Proceeds
allocable to principal collected during such Collection Period with respect
to any Defaulted Receivables.
'AVERAGE DELINQUENCY PERCENTAGE' means, for any Distribution Date, the
average of the Delinquency Percentages for such Distribution Date and the
preceding two Distribution Dates.
'AVERAGE NET LOSS RATIO' means, for any Distribution Date, the average
of the Net Loss Ratios for such Distribution Date and the preceding two
Distribution Dates.
'DELINQUENCY PERCENTAGE' means, for any Distribution Date the sum of
the outstanding principal balances of all Receivables which are 60 days or
more delinquent (including Receivables, which are not Defaulted
Receivables, relating to Financed Vehicles that have been repossessed), as
of the the close of business on the last day of the Collection Period
immediately preceding such Distribution Date, determined in accordance with
the Servicer's normal practices, such sum expressed as a percentage of the
Pool Balance as of the close of business on the last day of such Collection
Period.
'LIQUIDATION PROCEEDS' means with respect to any Receivable (i)
insurance proceeds, (ii) the monies collected during a Collection Period
from whatever source on a Defaulted Receivable and (iii) proceeds of a
Financed Vehicle sold after repossession, in each case, net of any
liquidation expenses and payments required by law to be remitted to the
Obligor.
'NET LOSS RATIO' means, for any Distribution Date, an amount expressed
as a percentage, equal to (i) the Aggregate Net Losses for such
Distribution Date, divided by (ii) the average of the Pool Balances on each
of the related Settlement Date and the last day of the related Collection
Period.
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The Specified Reserve Account Balance may be reduced to a lesser amount as
determined by the Seller; provided, that such reduction does not adversely
affect any rating of the Certificates by a Rating Agency. Amounts on deposit in
the Reserve Account will be released to the Seller on each Distribution Date to
the extent that the amount on deposit in the Reserve Account would exceed the
Specified Reserve Account Balance. The Collateral Agent will cause all
Investment Earnings attributable to the Reserve Account to be distributed on
each Distribution Date to the Seller. Upon distribution to the Seller of amounts
from the Reserve Account, the Certificateholders will not have any rights in, or
claims to, such amounts.
DISTRIBUTIONS ON CERTIFICATES
On or before the 10th day of each month (or, if such 10th day is not a
Business Day, the preceding Business Day), the Servicer will inform the Trustee
and the Paying Agent of the following amounts with respect to the preceding
Collection Period: (i) the amount of aggregate collections on the Receivables;
(ii) the aggregate amount of Advances to be remitted by the Servicer; (iii) the
aggregate Repurchase Amount of Receivables to be repurchased by the Seller or
purchased by the Servicer; (iv) the amount to be withdrawn from the Reserve
Account; (v) Class A Interest Distributable Amount, Class A Principal
Distributable Amount, Class B Interest Distributable Amount and Class B
Principal Distributable Amount; (vi) the Servicing Fee; and (vii) the amount to
be deposited in the Reserve Account and the amount to be distributed to the
Seller therefrom on such Distribution Date.
On each Distribution Date, after payment to the Servicer from the
Collection Account of amounts in respect of Advances previously made by the
Servicer (as described below under 'Pooling and Servicing Agreement--
Advances'), the Servicer will make the following distributions and deposits from
the Collection Account, to the extent of the sum of Available Interest for such
Distribution Date and any Available Reserve Account Amount remaining after any
withdrawal from the Reserve Account to reimburse the Servicer for Advances
previously made by the Servicer (and, in the case of shortfalls occurring under
clause (b) below in the Class A Interest Distributable Amount, the Class B
Percentage of Available Principal to the extent of such shortfalls), in the
following priority:
(a) to the Servicer, any unpaid Servicing Fee for the related
Collection Period and all unpaid Servicing Fees from prior Collection
Periods;
(b) to the Class A Distribution Account, the Class A Interest
Distributable Amount for such Distribution Date; and
(c) to the Class B Distribution Account, the Class B Interest
Distributable Amount for such Distribution Date.
On each Distribution Date, the Servicer will make the following deposits
and distributions, to the extent of the portion of Available Principal and
Available Interest for such Distribution Date and any Available Reserve Account
Amount remaining after any withdrawal from the Reserve Account in respect of
Advances described above and the application of clauses (a), (b) and (c) above,
in the following priority:
(d) to the Class A Distribution Account, the Class A Principal
Distributable Amount for such Distribution Date;
(e) to the Class B Distribution Account, the Class B Principal
Distributable Amount for such Distribution Date;
(f) to the Collateral Agent for deposit in the Reserve Account, any
remaining Available Interest and Available Principal.
On each Distribution Date, the Trustee or the Paying Agent, as the case may
be, will distribute all amounts on deposit in the Class A Distribution Account
to the Class A Certificateholders as of the Record Date and all amounts on
deposit in the Class B Distribution Account to the Class B Certificateholders as
of the Record Date.
'AVAILABLE INTEREST' means, for any Distribution Date, that portion of
collections on the Receivables received during the related Collection Period
allocated to interest, all Advances made by the Servicer with respect to such
Distribution Date and, to the extent attributable to interest, the Repurchase
Amount received with respect to each Receivable repurchased by the Seller or
purchased by the Servicer under an obligation that arose during the related
Collection Period.
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'AVAILABLE PRINCIPAL' means, for any Distribution Date, that portion of
collections on the Receivables received during the related Collection Period
allocated to the principal balance of the Receivables, and, to the extent
attributable to principal, the Repurchase Amount received with respect to each
Receivable repurchased by the Seller or purchased by the Servicer under an
obligation that arose during the related Collection Period.
'CLASS A INTEREST CARRYOVER SHORTFALL' means, (a) for the initial
Distribution Date, zero, and (b) for any other Distribution Date, the excess of
Class A Monthly Interest for the preceding Distribution Date and any outstanding
Class A Interest Carryover Shortfall for such preceding Distribution Date over
the amount in respect of interest that is actually deposited in the Class A
Distribution Account on such preceding Distribution Date, plus 30 days of
interest on such excess, to the extent permitted by law, at the Class A
Pass-Through Rate.
'CLASS A INTEREST DISTRIBUTABLE AMOUNT' means, for any Distribution Date,
the sum of Class A Monthly Interest for such Distribution Date and the Class A
Interest Carryover Shortfall for such Distribution Date.
'CLASS A MONTHLY INTEREST' means, for any Distribution Date, one-twelfth of
the Class A Pass-Through Rate multiplied by the Class A Certificate Balance as
of the preceding Distribution Date (after giving effect to any payments made on
such preceding Distribution Date) or, in the case of the first Distribution
Date, as of the Closing Date.
'CLASS A MONTHLY PRINCIPAL' means, for any Distribution Date, the sum of
(a) the Class A Percentage of the Available Principal for such Distribution Date
and (b) the Class A Percentage of Aggregate Net Losses with respect to the
related Collection Period.
'CLASS A PRINCIPAL CARRYOVER SHORTFALL' means, for any Distribution Date,
the excess of Class A Monthly Principal for the preceding Distribution Date and
any outstanding Class A Principal Carryover Shortfall for such preceding
Distribution Date over the amount in respect of principal that is actually
deposited in the Class A Distribution Account on such preceding Distribution
Date.
'CLASS A PRINCIPAL DISTRIBUTABLE AMOUNT' means, for any Distribution Date,
the sum of Class A Monthly Principal for such Distribution Date and, in the case
of any Distribution Date other than the initial Distribution Date, the Class A
Principal Carryover Shortfall for such Distribution Date. In addition, on the
Final Scheduled Distribution Date, the Class A Principal Distributable Amount
shall include any additional amount required to reduce the outstanding aggregate
principal balance of the Class A Certificates to zero.
'CLASS B INTEREST CARRYOVER SHORTFALL' means, (a) for the initial
Distribution Date, zero, and (b) for any other Distribution Date, the excess of
Class B Monthly Interest for the preceding Distribution Date and any outstanding
Class B Interest Carryover Shortfall for such preceding Distribution Date over
the amount in respect of interest that is actually deposited in the Class B
Distribution Account on such preceding Distribution Date, plus 30 days of
interest on such excess, to the extent permitted by law, at the Class B
Pass-Through Rate.
'CLASS B INTEREST DISTRIBUTABLE AMOUNT' means, with respect to any
Distribution Date, the sum of Class B Monthly Interest for such Distribution
Date and the Class B Interest Carryover Shortfall for such Distribution Date.
'CLASS B MONTHLY INTEREST' means, for any Distribution Date, one-twelfth of
the Class B Pass-Through Rate multiplied by the Class B Certificate Balance as
of the preceding Distribution Date (after giving effect to any payments made on
such preceding Distribution Date) or, in the case of the first Distribution
Date, as of the Closing Date.
'CLASS B MONTHLY PRINCIPAL' means, with respect to any Distribution Date,
the sum of (a) the Class B Percentage of the Available Principal for such
Distribution Date and (b) the Class B Percentage of Aggregate Net Losses with
respect to the related Collection Period.
'CLASS B PRINCIPAL CARRYOVER SHORTFALL' means, for any Distribution Date,
the excess of Class B Monthly Principal for the preceding Distribution Date and
any outstanding Class B Principal Carryover Shortfall for such preceding
Distribution Date over the amount in respect of principal that is actually
deposited in the Class B Distribution Account for such preceding Distribution
Date.
'CLASS B PRINCIPAL DISTRIBUTABLE AMOUNT' means, for any Distribution Date,
the sum of Class B Monthly Principal for such Distribution Date and, in the case
of any Distribution Date other than the initial Distribution Date, the Class B
Principal Carryover Shortfall for such Distribution Date. In addition, on the
Final Scheduled Distribution Date, the Class B Principal Distributable Amount
will include any additional amount required to reduce the outstanding aggregate
principal balance of the Class B Certificates to zero.
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In the event that the Reserve Account has been reduced to zero and, in the
case of the Class A Certificateholders, the subordination of the Class B
Certificates is insufficient, the Certificateholders will bear directly the
credit and other risks associated with ownership of the Receivables. In such a
case, the amount available for distribution may be less than that described
above, and the Certificateholders may experience delay or suffer losses as a
result of, among other things, defaults or delinquencies by the Obligors or
previous extensions made by the Servicer. In addition, because the market value
of motor vehicles generally declines with age and because of the difficulties in
enforcing motor vehicle contracts described under 'Certain Legal Aspects of the
Receivables' in the Prospectus, the Servicer may not recover the entire amount
owing under a Defaulted Receivable. In such a case, the Certificateholders may
suffer a corresponding loss.
As an administrative convenience, the Servicer will be permitted under
certain circumstances to make deposits of Advances and Repurchase Amounts for,
or with respect to, a Collection Period net of distributions to be made to the
Servicer with respect to such Collection Period. The Servicer, however, will
account to the Trustee and to the Certificateholders as if all such deposits and
distributions were deposited and distributed separately. On each Distribution
Date the Servicer will also distribute to itself, to the extent not previously
netted, any reimbursements of Advances, Investment Earnings on amounts on
deposit in the Collection Account, the Servicing Fee and the amount of any
Servicing Fee previously due but not paid, if any.
DESCRIPTION OF THE POOLING AND SERVICING AGREEMENT
SERVICING COMPENSATION AND PAYMENT OF EXPENSES
The Servicer will be entitled to receive the Servicing Fee for each
Collection Period. The 'SERVICING FEE RATE' with respect to the Servicing Fee
for the Servicer will be % per annum and the 'SERVICING FEE' for any
Distribution Date shall equal an amount equal to the sum of (i) the product of
one-twelfth of the Servicing Fee Rate and the Pool Balance as of the close of
business on the related Settlement Date and (ii) Late Fees paid by the Obligors
during such Collection Period. In addition, the Servicing Fee will include
Investment Earnings on amounts on deposit in the Collection Account; provided,
however, that from and after the Collection Period in which the Servicer fails
to deposit an Advance with respect to a Receivable (other than because such
Receivable has been declared a Defaulted Receivable), such Investment Earnings
will not be paid to the Servicer, but will be deposited in the Reserve Account.
The amount of the Servicing Fee (including the portion thereof attributable
to Late Fees) was determined in light of the duties of the Servicer under the
Agreement as well as with a view toward providing the Servicer with a reasonable
profit. The Servicing Fee (including such Late Fees) is comparable to fees that
would be paid to parties unaffiliated with the Bank. The Bank expects that the
Receivables will provide the Trust with funds in an amount sufficient to pay the
Servicing Fee to the Servicer and interest each month at the Class A
Pass-Through Rate and Class B Pass-Through Rate on the related Class A
Certificate Balance and Class B Certificate Balance, respectively, to the
Certificateholders. See 'Description of the Transfer and Servicing
Agreements--Servicing Compensation and Payment of Expenses' and '--Net Deposits'
in the Prospectus.
SERVICING PROCEDURES
The Servicer will service the Receivables and will make reasonable efforts
to collect all payments due with respect to the Receivables and, in a manner
consistent with the Agreement and with the terms of the Receivables, will follow
such collection and servicing procedures as it follows with respect to
comparable new or used automobile receivables that it services for itself or
others and that are consistent with prudent industry standards. Except as
otherwise specified in the Agreement, no extensions of, or other modifications
to, the Receivables will be made by the Servicer if such modifications would
have a material adverse effect on the interests of the Certificateholders. In
addition, among other things, the Agreement will provide that the Servicer may
not change the amount of (except with respect to a prepayment of a scheduled
payment that does not result in a deferral of any other scheduled payment), or
reschedule the Due Date of, any scheduled payment to a date more than 30 days
from the original Due Date, change the Contract Rate of, or extend any
Receivable or change any material term of a Receivable, except with respect to
certain unilateral changes provided by the terms of the Receivable or of the
Agreement or as required by law or court order; provided, however, that the
Servicer may grant extensions of the Due Date for a payment on any Receivable
that is in default, or if it determines that, absent such extension, a default
on the Receivables is reasonably foreseeable, and the Servicer would grant such
extension with respect
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to comparable new or used automobile receivables that it services for itself,
but only if (a) the Available Reserve Account Amount is greater than zero at the
time of such extension, (b) the extension is for no more than three months, (c)
the total period of all credit-related extensions granted on the Receivable will
not exceed the number of months equal to the number of whole years comprising
the original term of the Receivable, (d) the maturity of such Receivable would
not be extended beyond the Collection Period immediately preceding the Final
Scheduled Distribution Date and (e) the rescheduling or extension would not
modify the terms of such Receivable in such a manner as to constitute a
cancellation of such Receivable and the creation of a new receivable for federal
income tax purposes. In accordance with its normal and customary servicing
procedures, the Servicer also considers other criteria when making
credit-related extensions.
In the event that the Servicer fails to comply with the foregoing terms of
the Agreement, it will be required to purchase the affected Receivable at a
price equal to the Repurchase Amount as of the last day of the Collection Period
on which it became aware or receives written notice from the Trustee of such
failure. The purchase obligation will constitute the sole remedy available to
the Certificateholders or the Trustee for any such uncured breach.
The Bank will offer certain Obligors or classes of Obligors on an annual
basis a one month noncredit related extension of a regularly scheduled payment
otherwise due under a Receivable. The Agreement establishes criteria governing
such extensions.
See 'Description of the Transfer and Servicing Agreements--Servicing
Procedures' in the Prospectus.
ADVANCES
With respect to any Distribution Date, the Servicer may, in its sole
discretion, make a payment (an 'ADVANCE') with respect to each Receivable (other
than a Defaulted Receivable) equal to the excess, if any, of (x) the product of
the principal balance of such Receivable as of the related Settlement Date and
one-twelfth of its Contract Rate, over (y) the interest actually received by the
Servicer with respect to such Receivable from the Obligor or from the payment of
the Repurchase Amount during or with respect to such Collection Period. The
Servicer may elect not to make any Advance with respect to a Receivable to the
extent that the Servicer, in its sole discretion, determines that such Advance
is not recoverable from subsequent payments on such Receivable or from funds in
the Reserve Account. In the event that the Servicer does not make an Advance,
any Payment Deficiency resulting therefrom will be funded by a withdrawal from
the Reserve Account to the extent of the Available Reserve Account Amount.
To the extent that the amount set forth in clause (y) above plus amounts
withdrawn from the Reserve Account during or with respect to such Collection
Period and allocable to interest with respect to a Receivable is greater than
the amount set forth in clause (x) above with respect thereto, such amount shall
be distributed to the Servicer on the related Distribution Date to reimburse the
Servicer for previous unreimbursed Advances with respect to such Receivable.
Before a Receivable becomes a Defaulted Receivable, any such reimbursement will
only be from accrued interest due from the Obligor under such Receivable.
In addition, on each Deposit Date the Trustee shall demand a withdrawal
from the Reserve Account equal to the amount of any outstanding Advances of
interest accrued on Defaulted Receivables to the extent not recovered from
Liquidation Proceeds.
The Servicer will deposit all Advances with respect to any Distribution
Date into the Collection Account on the related Deposit Date.
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CERTAIN FEDERAL INCOME TAX CONSEQUENCES
The following is a general summary of certain United States ('U.S.')
federal income tax consequences relevant to the purchase, ownership and
disposition of the Certificates. This summary is based upon the Internal Revenue
Code of 1986, as amended (the 'CODE'), the Treasury regulations promulgated
thereunder, administrative rulings or pronouncements and judicial decisions, all
as in effect on the date hereof and all of which are subject to change, possibly
retroactively. The following discussion does not deal with all aspects of U.S.
income taxation, nor does it address U.S. federal income tax consequences that
may be relevant to certain types of investors, such as banks, insurance
companies, dealers in securities, tax-exempt organizations or persons whose
functional currency is not the U.S. dollar, who may be subject to special
treatment under the Code. In addition, the following discussion does not address
the tax consequences of an investment in the Certificates under state and local
tax laws or foreign tax laws. Prospective investors should note that no rulings
have been or will be sought from the Internal Revenue Service ('IRS') with
respect to any of the U.S. federal income tax consequences discussed herein and
opinions of counsel are not binding on the IRS or the courts. Thus, no assurance
can be given that the IRS will not take positions contrary to those described
below. The opinion of Simpson Thacher & Bartlett, special counsel to the Seller
('FEDERAL TAX COUNSEL'), described herein will be based upon certain
representations and assumptions, including, but not limited to, the assumption
that all relevant parties will comply with the terms of the Agreement and
related documents.
Because the Certificates have certain features characteristic of debt, the
Certificates might be considered debt of the Seller or Trust. Any such
characterization generally would not result in materially adverse tax
consequences as compared to the tax consequences described below. The following
discussion assumes that (i) the Trust will be classified as a grantor trust and
(ii) the Certificateholders will be treated as owning an undivided beneficial
ownership interest in each Receivable and the proceeds thereof.
This summary is intended as an explanatory discussion of the possible
effects of the classification of the Trust as a grantor trust and not as an
association taxable as a corporation for federal income tax purposes and
related matters affecting investors generally, but does not purport to furnish
information in the level of detail or with the attention to the investor's
specific tax circumstances that would be provided by an investor's own tax
adviser. Accordingly, investors should consult their own tax advisors to
determine the federal, state, local, and other tax consequences that may be
relevant to their purchase, ownership and disposition of the Certificates based
upon their particular facts and circumstances.
For purposes of the following discussion, except as otherwise provided
herein, the term 'CERTIFICATEHOLDER' refers to the beneficial owner of a
Certificate. In addition, the discussion below assumes that Certificateholders
will hold their Certificates as 'capital assets' within the meaning of Section
1221 of the Code.
TAX CHARACTERIZATION OF THE TRUST AS A GRANTOR TRUST.
In the opinion of Federal Tax Counsel, the Trust will be classified as a
grantor trust and not as an association taxable as a corporation for U.S.
federal income tax purposes. Accordingly, for such purposes, each
Certificateholder will be treated as the owner of a fractional undivided
interest in the assets of the Trust and will be treated as though it paid
directly its share of all reasonable expenses paid by the Trust.
TAX CONSEQUENCES TO CERTIFICATEHOLDERS.
The Seller has retained a fixed portion of the interest due on each
Receivable equal to the difference between the Contract Rate of the Receivable
and a base rate (the 'BASE RATE') on each such Receivable (such difference
referred to as the 'RETAINED YIELD'). The Base Rate on each Receivable is the
weighted average interest rate on each Receivable equal to (i) the Class A
Percentage of such Receivable multiplied by the sum of the Class A Pass-Through
Rate and the Servicing Fee Rate, plus (ii) the Class B Percentage of such
Receivable multiplied by the sum of the Class B Pass-Through Rate and the
Servicing Fee Rate. The Seller and the Certificateholders (by accepting a
beneficial interest in a Certificate) will agree to treat the Certificates as
ownership interests in the Receivables (other than the Retained Yield). In
addition, the Servicer and the Seller have represented that the Servicing Fee
Rate and all other amounts paid to,
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or retained by, the Servicer represent a reasonable, arm's length servicing fee.
Accordingly, the Trustee and the Servicer intend to treat the Retained Yield as
'stripped coupons' within the meaning of Section 1286 of the Code and the
Receivables sold to the Trust will be treated as 'stripped bonds.'
Thus, the Certificates will represent an ownership interest in stripped
bonds and each Certificateholder will be treated as owning its pro rata share of
such stripped bonds. However, if the Class B Pass-Through Rate exceeds the Class
A Pass-Through Rate, a portion of the interest accrued on each Receivable will
be treated as a 'stripped-coupon' purchased by the Class B Certificateholders
(the 'CLASS B STRIPPED COUPON'). In such case, each Class A Certificateholder
will be treated as owning its pro rata percentage interest in the principal of,
and interest payable on, each Receivable (minus the portion of the interest
payable on such Receivable that represents (i) the Retained Yield and (ii) the
Class B Stripped Coupon purchased by the Class B Certificateholders), and such
interest in each Receivable will be treated as a 'stripped bond' within the
meaning of Section 1286 of the Code. Similarly, in this instance, each Class B
Certificateholder will be treated as owning its pro rata percentage in the
principal of, and interest payable on, each Receivable, minus the portion of
such interest that represents the Retained Yield, plus the amount of the Class B
Stripped Coupon.
The stripped bonds described above will be subject to the original issue
discount ('OID') rules of the Code. Consequently, the tax treatment of a
Certificateholder will depend upon whether the amount of OID on a Certificate is
less than a statutorily defined de minimis amount.
Under Treasury regulations issued under Section 1286 of the Code, the
amount of OID on a Receivable treated as a 'stripped bond' generally will be
considered de minimis if it is less than 1/4 of one percent for each full year
of weighted average life remaining after the purchase date until the maturity of
the Receivable, although it is not clear whether expected prepayments are taken
into account. It is anticipated that the Company will treat the portion of the
interest on each Receivable payable to the Certificateholders as 'qualified
stated interest'. As a result, the amount of OID on a Receivable should equal
the amount by which the price at which a Certificateholder is deemed to have
acquired an interest in the Receivable (the 'PURCHASE PRICE') is less than the
portion of the remaining principal balance of the Receivable allocable to the
interest acquired.
If the amount of OID is de minimis under the rule set forth above, the
Certificates would not be treated as having been issued with OID. Accordingly,
each Certificateholder would be required to report on its U.S. federal income
tax return its share of the gross income of the Trust, including interest and
certain other charges accrued on the Receivables and any gain realized upon the
collection or disposition of the Receivables (but not including any portion of
the Retained Yield). Such gross income attributable to interest on the
Receivables would exceed the applicable Pass-Through Rate by an amount equal to
the Certificateholder's share of the expenses of the Trust for the period during
which it owns a Certificate. The Certificateholder would be entitled to deduct
its share of the expenses of the Trust to the extent described below.
Assuming that OID on each Receivable is de minimis, a Certificateholder
would report its share of the Trust's income under its usual method of
accounting. Accordingly, interest would be includible in a Certificateholder's
gross income when it accrues on the Receivables, or, in the case of
Certificateholders who are cash method taxpayers, when received by the Servicer
on behalf of the Certificateholders. Because (i) interest accrues on the
Receivables over differing monthly periods and is paid in arrears and (ii)
interest collected on Receivables generally is paid to Certificateholders in the
following month, the amount of interest accruing to a Certificateholder during
any calendar month generally will not equal the interest distributed in that
month. The actual amount of any OID on a Receivable would be includible in
income as principal payments are received on the Receivables.
If the OID on a Receivable is not treated as being de minimis, in addition
to the amounts described above, a Certificateholder will be required to include
in income any OID as it accrues on a daily basis, regardless of when cash
payments are received, using a method reflecting a constant yield on the
Receivable. Prepayment assumptions may be required in computing the yield of a
Receivable. If a Receivable is deemed to be acquired by a Certificateholder at a
significant discount, such treatment could accelerate the accrual of income by a
Certificateholder.
The Trustee intends to account for OID, if any, reportable by
Certificateholders by reference to the price paid for a Certificate by an
initial purchaser, although the amount of OID will differ for subsequent
purchasers.
S-22
<PAGE>
Such subsequent purchasers should consult their tax advisers regarding the
proper calculation of OID on the interest in Receivables represented by a
Certificate. In addition, the Trustee intends to compute OID on Certificates by
aggregating all payments on the Receivables allocable to the Certificateholders
(not including the Retained Yield), and treating the portion of all payments on
the Receivables allocable to Certificateholders as a single obligation. The IRS
could require, instead, that the computation be performed on a Receivable-by-
Receivable basis. Any such recalculation could adversely affect the timing and
character of a Certificateholder's income.
In the event that a Receivable is treated as purchased at a premium (i.e.,
its Purchase Price exceeds the portion of the remaining principal balance of
such Receivable allocable to the Certificateholder), such premium will be
amortizable by the Certificateholder as an offset to interest income (with a
corresponding reduction in the Certificateholder's basis) under a constant yield
method over the term of the Receivable provided an election under Section 171
of the Code is made with respect to the interests in the Receivables represented
by the Certificates or was previously in effect. Any such election also will
apply to all debt instruments held by the Certificateholder during the year in
which the election is made and all debt instruments thereafter acquired.
A Certificateholder will be entitled to deduct, consistent with its method
of accounting, its pro rata share of reasonable servicing fees and other fees
paid or incurred by the Trust as provided in Section 162 or 212 of the Code. If
a Certificateholder is an individual, estate or trust, the deduction for such
Certificateholder's share of such fees will be allowed only to the extent that
all such Certificateholder's miscellaneous itemized deductions, including such
Certificateholder's share of such fees, exceed 2% of such Certificateholder's
'adjusted gross income'. In addition, in the case of Certificateholders who are
individuals, certain otherwise allowable itemized deductions will be reduced
(but not by more than 80%) by an amount equal to 3% of such Certificateholder's
adjusted gross income in excess of a statutorily defined threshold ($121,200 in
the case of a married couple filing jointly for the taxable year beginning
1997). Because the Servicer will not report to Certificateholders the amount of
servicing compensation that is attributable to the Servicer's right to receive
certain fees collected from Obligors and interest earned on Collections, a
Certificateholder subject to the foregoing limitations may effectively
underreport its net taxable income.
Class B Certificateholders. Even if the Class B Pass-Through Rate exceeds
the Class A Pass-Through Rate, it is believed that the Class B
Certificateholders generally will be subject to tax in the same manner as Class
A Certificateholders. However, in this instance no U.S. federal income tax
authorities address the precise method of taxation of an instrument such as the
Class B Certificates. In the absence of applicable authorities, the Servicer
intends to report income to Class B Certificateholders in the manner described
below.
As discussed above, if the Class B Pass-Through Rate exceeds the Class A
Pass-Through Rate, each Class B Certificateholder will be treated as owning (i)
the Class B Percentage of the principal on each Receivable plus (ii) a
disproportionate portion of the interest on each Receivable (not including the
Retained Yield). Income will be reported to a Class B Certificateholder based on
the assumption that all amounts payable to the Class B Certificateholders
(including amounts payable with respect to the Class B Stripped Coupon) are
taxable under the coupon stripping provisions of the Code, and will be
aggregated and treated as a single debt obligation. In applying those
provisions, the Servicer will take the position that a Class B
Certificateholder's entire share of the interest on a Receivable (including
amounts payable with respect to the Class B Stripped Coupon) will qualify as
'qualified stated interest.' Thus, except to the extent modified by the effects
of subordination of the Class B Certificates, as described below, income will be
reported to Class B Certificateholders in the manner described above for holders
of the Certificates.
Effect of Subordination. If the Class B Certificateholders received a
Shortfall Amount due to the subordination of the Class B Certificates, holders
of Class B Certificates would probably be treated for U.S. federal income tax
purposes as if they had (i) received as distributions their full share of such
receipts and (ii) paid over to the Class A Certificateholders an amount equal to
such Shortfall Amount, and (iii) retained the right to reimbursement of such
amounts to the extent of future collections otherwise available for deposit in
the Cash Collateral Account.
Under this analysis, (i) Class B Certificateholders would be required to
accrue as current income any interest or OID income of the Trust that was a
component of the Shortfall Amount, even though such amount was in fact paid to
the Class A Certificateholders and (ii) a loss would be allowed to the Class B
Certificateholders only
S-23
<PAGE>
when their right to receive reimbursement of such Shortfall Amount became
worthless (i.e., when it becomes clear that such amount will not be available
from any source to reimburse such loss) and (iii) reimbursement of such
Shortfall Amount prior to such a claim of worthlessness would not be taxable
income to Class B Certificateholders because such amount was previously included
in income. This treatment should not significantly affect the inclusion of
income for Class B Certificateholders on the accrual method of accounting, but
could accelerate inclusion of income to Class B Certificateholders on the cash
method of accounting by, in effect, placing them on the accrual method.
Moreover, the character and timing of loss deductions is unclear.
Sale of a Certificate. If a Certificate is sold, gain or loss will be
recognized equal to the difference between the amount realized by the
Certificateholder on the sale and the Certificateholder's adjusted tax basis in
the Receivables and any other assets held by the Trust. A Certificateholder's
adjusted tax basis will equal the Certificateholder's cost for the Certificate,
increased by any OID previously included in income, and decreased by any
deduction previously allowed for accrued premium and by the amount of principal
payments previously received on the Receivables. Any gain or loss not
attributable to accrued interest will be capital gain or loss if the Certificate
was held as a capital asset, except to the extent such gain represents accrued
interest or OID not previously included in income. The deductibility of capital
losses is subject to limitations.
Foreign Certificateholders. For purposes of this discussion, the term
'Foreign Investor' means any person other than (i) a citizen or resident of the
United States, (ii) a corporation or partnership organized in or under the laws
of the United States or any political subdivision thereof, (iii) an estate the
income of which is includible in gross income for U.S. federal income tax
purposes regardless of its source or (iv) a trust if the primary supervision
over the administration of such trust can be exercised by a court within the
United States and one or more U.S. persons have the authority to control all
substantial decisions of such trust.
Interest on Receivables, including OID, paid to a Foreign Investor will be
subject to U.S. withholding tax at a rate of 30% unless (i) such interest income
is 'effectively connected' with the conduct by such Foreign Investor of a trade
or business carried on in the United States and the investor evidences this fact
by delivering an IRS Form 4224, (ii) the interest income is exempt from (or
subject to a reduced rate of) U.S. withholding tax under an applicable U.S. tax
treaty and the Foreign Investor claims this exemption (or reduced rate) by
delivering an IRS Form 1001, or (iii) the Foreign Investor and each securities
clearing organization, bank, or other financial institution that holds the
Certificates on behalf of such Foreign Investor in the ordinary course of its
trade or business in the chain between the Foreign Investor and the U.S. person
otherwise required to withhold the U.S. tax, complies with the applicable
identification requirements described below (and the Foreign Investor does not
actually or constructively own 10% or more of the voting stock of the Seller or
any of its affiliates and is not a 'controlled foreign corporation' with respect
to the Seller or any of its affiliates (or the Certificateholder of such an
interest)). The identification requirement described in (iii) above generally
will be satisfied if there is delivered to a securities clearing organization an
IRS Form W-8 signed under penalties of perjury by the Certificateholder, stating
that the Certificateholder is not a U.S. person and providing such
Certificateholder's name and address; provided that in any such case (x) the
applicable form is delivered pursuant to applicable procedures and is properly
transmitted to the United States entity otherwise required to withhold tax and
(y) none of the entities receiving the form has actual knowledge that the
Certificateholder is a U.S. person.
If a Foreign Investor is engaged in the conduct of a trade or business in
the United States and the interest income (including OID) allocable to the
Certificates held by such Foreign Investor is effectively connected with the
conduct of such trade or business, such interest income, although exempt from
the U.S. withholding tax described above, will be subject to U.S. federal income
tax on a net income basis in the same manner as if the Foreign Investor were a
U.S. person. In addition, if the Foreign Investor is a foreign corporation, it
also may be subject to a U.S. 'branch profits tax' equal to 30% of its
effectively connected earnings and profits for the taxable year (subject to
adjustments).
A Foreign Investor generally will not be subject to U.S. federal income tax
on gain realized upon the sale, exchange or redemption of a Certificate,
provided that (i) such gain is not effectively connected with the conduct of a
trade or business in the United States, (ii) in the case of a Foreign Investor
that is an individual, such individual is not present in the U.S. for 183 days
or more during the taxable year in which such sale, exchange or redemption
occurs or certain other conditions are not met, and (iii) in the case of gain
representing accrued interest, the conditions described above are satisfied.
S-24
<PAGE>
Backup Withholding. Payments made on the Certificates and proceeds from
the sale of Certificates generally will not be subject to the 31% U.S. backup
withholding tax unless the Certificateholder fails to comply with certain
reporting procedures and is not an exempt recipient under applicable provisions
of the Code.
CERTAIN STATE TAX CONSEQUENCES
The above discussion does not address the tax treatment of the Trust, the
Certificates or Certificateholders under any state tax laws. Prospective
investors are urged to consult with their own tax advisors regarding the state
tax treatment of the Trust as well as any state tax consequences to them,
particularly in the case of financial institutions, of purchasing, holding and
disposing of Certificates.
ERISA CONSIDERATIONS
GENERAL
ERISA and Section 4975 of the Code impose certain requirements on employee
benefit plans and certain other plans and arrangements, including individual
retirement accounts and annuities, Keogh plans and certain collective investment
funds or insurance company general or separate accounts in which such plans,
accounts or arrangements are invested, that are subject to the fiduciary
responsibility provisions of ERISA and/or Section 4975 of the Code
(collectively, 'PLANS'), and on persons who are fiduciaries with respect to
Plans, in connection with the investment of 'plan assets' of any Plan ('PLAN
ASSETS'). ERISA generally imposes on Plan fiduciaries certain general fiduciary
requirements, including those of investment prudence and diversification and the
requirement that a Plan's investments be made in accordance with the documents
governing the Plan. Generally, any person who has discretionary authority or
control respecting the management or disposition of Plan Assets, and any person
who provides investment advice with respect to such assets for a fee, is a
fiduciary with respect to such Plan Assets.
The U.S. Department of Labor ('DOL') has issued a final regulation (29
C.F.R. Section 2510.3-101) concerning the definition of what constitutes the
Plan Assets of a Plan (the 'PLAN ASSET REGULATION'). This regulation provides
that, as a general rule, the underlying assets and properties of corporations,
partnerships, grantor trusts and certain other entities in which a Plan makes an
'equity' investment will be deemed, for purposes of ERISA and Section 4975 of
the Code, to be assets of the investing Plan unless certain exceptions set forth
in the Plan Asset Regulation apply. Accordingly, if a Plan purchases the
Certificates, the Trust could be deemed to hold Plan Assets unless one of the
exceptions under the Plan Assets Regulation is applicable to the Trust.
Under the terms of the Plan Asset Regulation, if the Trust were deemed to
hold Plan Assets by reason of a Plan's investment in a Certificate, such Plan
Assets would include an undivided interest in the Trust and Receivables
underlying assets of the Trust, and the persons providing services with respect
to the assets of the Trust, including the Receivables, would be subject to the
fiduciary responsibility provisions of ERISA and the prohibited transaction
provisions of ERISA and Section 4975 of the Code with respect to transactions
involving such assets. Absent an applicable statutory, regulatory or
administrative exemption, such transactions could give rise to a violation of
the prohibited transaction rules, resulting in the imposition of an excise tax
and other liabilities under ERISA and Section 4975 of the Code.
CLASS A CERTIFICATES
The DOL has granted to Chase Securities Inc. (the successor to Chemical
Securities Inc.), the managing underwriter, an administrative exemption,
Prohibited Transaction Exemption ('PTE') 90-33 (Exemption Application No.
D-7940), as amended by PTE 97-34, 62 Fed. Reg. 39021 (July 21, 1997) (the
'EXEMPTION'), from certain of the prohibited transaction rules of ERISA and
Section 4975 of the Code with respect to the initial purchase, the holding and
the subsequent resale by Plans of certificates representing interests in
asset-backed pass-through trusts that consist of certain receivables, loans and
other obligations that meet the conditions and requirements of the Exemption.
The receivables covered by the Exemption include motor vehicle installment
obligations and purchase money loans such as the Receivables. The Exemption will
apply to the acquisition,
S-25
<PAGE>
holding and resale of the Class A Certificates by a Plan, provided that certain
conditions (some of which are described below) are met.
Among the conditions which must be satisfied for the Exemption to apply are
the following:
(1) The acquisition of the Class A Certificates by a Plan is on terms
(including the price for the Certificates) that are at least as favorable
to the Plan as they would be in an arm's-length transaction with an
unrelated party;
(2) The rights and interests evidenced by the Class A Certificates
acquired by the Plan are not subordinated to the rights and interests
evidenced by other Certificates issued by the Trust;
(3) The Class A Certificates acquired by the Plan have received a
rating at the time of such acquisition that is in one of the three highest
generic rating categories from either Standard & Poor's Rating Services,
Moody's Investors Service, Inc., Duff & Phelps Credit Rating Co. or Fitch
Investors Service L.P. [(each, an 'EXEMPTION RATING AGENCY')].
(4) The sum of all payments made to and retained by the Underwriters
in connection with the distribution of the Class A Certificates represents
not more than reasonable compensation for underwriting the Class A
Certificates; the sum of all payments made to and retained by the Seller
pursuant to the sale of the Receivables to the Trust represents not more
than the fair market value of such Receivables; and the sum of all payments
made to and retained by the Servicer represents not more than reasonable
compensation for the Servicer's services under the Agreement and
reimbursement of the Servicer's reasonable expenses in connection
therewith;
(5) The Trustee must not be an affiliate of any other member of the
Restricted Group (as defined below); and
(6) The Plan investing in the Class A Certificates is an 'accredited
investor' as contained in Rule 501(a)(1) of Regulation D of the Securities
and Exchange Commission under the Securities Act of 1933, as amended.
Moreover, the Exemption provides relief from certain self-dealing/conflict
of interest prohibited transaction that may occur when a Plan fiduciary that is
an obligor with respect to 5% or less of the fair market value of the
Receivables held in the Trust (or an affiliate of such obligor) causes a Plan to
acquire Class A Certificates issued by the Trust, provided that, among other
requirements (i) in the case of an acquisition in connection with the initial
issuance of Class A Certificates, at least 50% of Class A Certificates in which
Plans have invested is acquired by persons independent of the Restricted Group
and at least 50% of the aggregate interest in the Trust is acquired by persons
independent of the Restricted Group; (ii) the Plan's investment in Class A
Certificates does not exceed 25% of all of the Class A Certificates outstanding
at the time of the acquisition; and (iii) immediately after the acquisition, no
more than 25% of the assets of the Plan are invested in certificates
representing an interest in one or more trusts containing assets sold or
serviced by the same entity. The Exemption, however, does not apply to the
acquisition and holding of the Class A Certificates by Plans sponsored by the
Seller, the Underwriters, the Trustee, the Servicer, any obligor with respect to
Receivables included in the Trust constituting more than 5% of the aggregate
unamortized principal balance of the assets in the Trust, or any affiliate of
such parties (the 'RESTRICTED GROUP').
As of the date hereof, no obligor with respect to Receivables included in
the Trust is an obligor with respect to more than 5% of the aggregate
unamortized principal balance of the assets of the Trust.
[PRE-FUNDING ACCOUNTS
The Exemption will apply to the initial purchase, holding or subsequent
resale of the Class A Certificates during the Funding Period, provided that
certain conditions, including the following, are met:
(1) The ratio of the amount allocated to the Pre-Funding Account to
the total principal amount of the Certificates as of the Closing Date
('pre-funding limit') must not exceed 25%.
(2) All Subsequent Receivables must meet the same terms and conditions
for eligibility as the Initial Receivables, which terms and conditions have
been approved by an Exemption Rating Agency.
S-26
<PAGE>
(3) The transfer of the Subsequent Receivables to the Trust during the
Funding Period must not result in the Class A Certificates receiving a
lower credit rating from an Exemption Rating Agency upon termination of
the Pre-Funding Period than the rating that was obtained on the Closing
Date.
(4) The weighted average annual percentage interest rate (the 'AVERAGE
INTEREST RATE') for all of the Receivables in the Trust at the end of the
Funding Period must not be more than 100 basis points lower than the
Average Interest Rate for the Initial Receivables as of the Closing Date.
(5) An independent accountant retained by the Servicer must provide
the Seller with a letter (with copies provided to the applicable Exemption
Rating Agencies, the Underwriters and the Trustee) stating whether or not
the characteristics of the Subsequent Receivables conform to the
characteristics of such Receivables described herein and set forth in the
Agreement. In preparing such letter, the independent accountant must use
the same type of procedures as were applicable to the Initial Receivables.
(6) The Funding Period shall commence on the Closing Date and must
end no later than three months or 90 days after the Closing Date or earlier
if the Pre-Funding Account falls below the minimum level specified in the
Agreement or if an event of default occurs under the Agreement.
(7) Amounts on deposit in the Pre-Funding Account and that are held
in the Trust for a period ending no later than the first Distribution Date
to Certificateholders occurring after the end of the Funding Period may be
invested only in:
(i) direct obligations of, or obligations fully guaranteed as to
timely payment of principal and interest by, the United States or any
agency or instrumentality thereof (provided that such obligations are
backed by the full faith and credit of the United States); or
(ii) investments that have been rated (or the Obligor has been
rated) in one of the three highest generic rating categories by an
Exemption Rating Agency, are described in the Agreement and are
permitted by the applicable Exemption Rating Agency.
The Seller believes that all of the conditions for exemptive relief under
the Exemption with respect to pre-funding have been or will be satisfied.
Therefore, the acquisition, holding and transfer of the Class A Certificates by
or with 'plan assets' of a Plan should be eligible for relief under the
Exemption. However, any Plan investor who proposes to acquire Class A
Certificates in reliance upon the Exemption should consult with its counsel and
make its own determination as to the applicability of, and the advisability of
investing in the Class A Certificates in reliance upon, the Exemption.]
CLASS B CERTIFICATES
Because the Class B Certificates are subordinated to the Class A
Certificates, the Exemption will not apply to the acquisition of the Class B
Certificates and accordingly, the Class B Certificates may not be purchased by,
on behalf of, or with, Plan Assets of any Plan. In addition, each purchaser of
the Class B Certificates will be deemed to have represented that either (i) it
is neither a Plan nor purchasing the Class B Certificates on behalf of, or with,
Plan Assets of a Plan or (ii) its purchase and holding of the Class B
Certificates are eligible for the exemptive relief available under Sections I
and III of DOL Prohibited Transaction Class Exemption 95-60 (60 Fed. Reg. 35925,
July 12, 1995).
Any fiduciary or other Plan investor considering whether to purchase any
Certificates on behalf of or with Plan Assets of any Plan should consult with
its counsel and refer to this Prospectus Supplement and the Prospectus for
guidance regarding the ERISA Considerations applicable to the Certificates
offered hereby.
For further information see 'ERISA Considerations' in the Prospectus.
[LISTING AND GENERAL INFORMATION
Application will be made to list the Certificates on the Luxembourg Stock
Exchange. In connection with the listing application, the Organization
Certificate and By-laws of the Bank, as well as legal notice relating to the
issuance of the Certificates will be deposited prior to listing with the Chief
Registrar of the District Court of Luxembourg, where copies thereof may be
obtained upon request. Once the Certificates have been approved for listing,
trading of the Certificates may be effected on the Luxembourg Stock Exchange.
The Certificates have been accepted for clearance through the facilities of
DTC, Cedel and Euroclear. The CUSIP numbers and International Securities
Identification Numbers (ISIN) for the Notes are as follows:
<TABLE>
<CAPTION>
CLASS CUSIP ISIN
- - - ------------------------------------- ------------ -----------
<S> <C> <C> <C> <C>
Class A............................
Class B............................
</TABLE>
Common Code numbers will be available upon request of any Underwriter.
The transactions contemplated in this Prospectus Supplement were authorized
by resolutions adopted by the Bank's Board of Directors as of , 199
and by the Bank's Asset and Loan Securitization Committee as of ,
199 .
Copies of the Transfer and Servicing Agreements, the annual report of
independent public accountants described in 'Description of the Transfer and
Servicing Agreements--Evidence as to Compliance' in the Prospectus, the
documents listed under 'Available Information' and the reports to
Securityholders referred to under 'Reports to Securityholders' and 'Certain
Information Regarding the Securities--Reports to Securityholders' in the
Prospectus will be available free of charge at the office of Banque Generale du
Luxembourg, S.A. (the 'LISTING AGENT'), 50 Avenue J.F. Kennedy, L-2951,
Luxembourg. Financial information regarding the Bank is included in the
consolidated financial statements of The Chase Manhattan Corporation in The
Chase Manhattan Corporation's Annual Report on Form 10-K for the fiscal year
ended December 31, 1996. Such report is available, and reports for subsequent
years will be available, at the office of the Listing Agent.
So long as there is no Paying Agent and Transfer Agent in Luxembourg,
Banque Generale du Luxembourg, S.A. will act as intermediary agent in
Luxembourg. In the event that Definitive Certificates are issued, a Paying
Agent and Transfer Agent will be appointed in Luxembourg.
The Certificates and Transfer and Servicing Agreements are governed
by the laws of the State of New York (except for the Trust Agreement, which is
governed by the laws of the State of Delaware).]
S-27
<PAGE>
UNDERWRITING
Subject to the terms and conditions set forth in an underwriting agreement
(the 'UNDERWRITING AGREEMENT'), the Seller has agreed to sell to the Class A
Underwriters (the 'CLASS A UNDERWRITERS'), and each of the Class A Underwriters
has severally agreed to purchase, the principal amount of the Class A
Certificates set forth opposite its name below:
<TABLE>
<CAPTION>
PRINCIPAL AMOUNT
CLASS A UNDERWRITER OF CLASS A CERTIFICATES
- - - ----------------------------------------------------- -----------------------
<S> <C>
-----------------------
Total...........................................
-----------------------
-----------------------
</TABLE>
The Seller has been advised by the Class A Underwriters that the Class A
Underwriters propose initially to offer the Certificates to the public at the
prices set forth on the cover page hereof, and to certain dealers at such prices
less an initial concession not in excess of % of the principal amount of
the Class A Certificates. The Class A Underwriters may allow, and such dealers
may reallow, concessions not in excess of % of the principal amount of the
Class A Certificates to certain brokers and dealers. After the initial public
offering, the public offering price of the Class A Certificates and other
selling terms may be changed by the Class A Underwriters.
Subject to the terms and conditions set forth in the Underwriting
Agreement, the Seller has agreed to sell to Chase Securities Inc. (the 'CLASS B
UNDERWRITER' and, together with the Class A Underwriters, the 'UNDERWRITERS'),
and the Class B Underwriter has agreed to purchase the principal amount of the
Class B Certificates.
The Seller has been advised by the Class B Underwriter that the Class B
Underwriter proposes initially to offer the Class B Certificates to the public
at the price set forth on the cover page hereof, and to certain dealers at such
price less a concession not in excess of % of the principal amount of the
Class B Certificates. The Class B Underwriter may allow, and such dealers may
reallow, concessions not in excess of % of the Class B Certificates to
certain brokers and dealers. After the initial public offering of the Class B
Certificates, the public offering price and other selling terms may be changed
by the Class B Underwriter.
, on behalf of the Class A Underwriters and
, on behalf of the Class B Underwriters, may engage in
over-allotment transactions, stabilizing transactions, syndicate covering
transactions and penalty bids with respect to the Certificates in accordance
with Regulation M under the Exchange Act. Over-allotment transactions involve
syndicate sales in excess of the offering size, which creates a syndicate short
position. Stabilizing transactions permit bids to purchase the Certificates so
long as the stabilizing bids do not exceed a specified maximum. Syndicate
covering transactions involve purchases of the Certificates in the open market
after the distribution has been completed in order to cover syndicate short
positions. Penalty bids permit to reclaim a selling
concession from a syndicate member when the Certificates originally sold by such
syndicate member are purchased in a syndicate covering transaction. Such
over-allotment transactions, stabilizing transactions, syndicate covering
transactions and penalty bids may cause the prices of the Certificates to be
higher than they would otherwise be in the absence of such transactions. Neither
the Seller nor any of the Underwriters represent that will
engage in any such transactions or that such transactions, once commenced, will
not be discontinued without notice.
S-28
<PAGE>
Each Underwriter has represented and agreed that (a) it has only issued or
passed on and will only issue or pass on in the United Kingdom any document
received by it in connection with the issue of the Certificates to a person who
is of a kind described in Article 11(3) of the Financial Services Act 1986
(Investment Advertisements) (Exemptions) Order 1996 or who is a person to whom
the document may otherwise lawfully be issued or passed on, (b) it has complied
and will comply with all applicable provisions of the Financial Services Act
1986 of Great Britain with respect to anything done by it in relation to the
Certificates in, from or otherwise involving the United Kingdom and (c) if that
Underwriter is an authorized person under the Financial Services Act 1986, it
has only promoted and will only promote (as that term is defined in Regulation
1.02 of the Financial Services (Promotion of Unregulated Schemes) Regulations
1991) to any person in the United Kingdom the scheme described herein if that
person is of a kind described either in Section 76(2) of the Financial Services
Act 1986 or in Regulation 1.04 of the Financial Services (Promotion Unregulated
Schemes) Regulations 1991.
[This Prospectus Supplement and the Prospectus may be used by Chase
Securities Inc., an affiliate of the Seller and a subsidiary of The Chase
Manhattan Corporation, in connection with offers and sales related to
market-making transactions in the Certificates. Chase Securities Inc. may act as
principal or agent in such transactions. Such sales will be made at prices
related to prevailing market prices at the time of sale. Chase Securities Inc.
has no obligation to make a market in the Certificates, and it may discontinue
any such market-making activities at any time without notice, in its sole
discretion. Chase Securities Inc. is among the Underwriters participating in the
initial distribution of the Certificates.]
In the ordinary course of their respective businesses, each Underwriter and
its affiliates have engaged and may in the future engage in commercial banking
and/or investment banking transactions with the Seller and its affiliates.
The Seller will indemnify the Underwriters against certain liabilities,
including liabilities under the Securities Act of 1933, as amended, or
contribute to payments the Underwriters may be required to make in respect
thereof.
LEGAL MATTERS
Certain legal matters relating to the issuance of the Certificates will be
passed upon for the Seller by Simpson Thacher & Bartlett (a partnership that
includes professional corporations), New York, New York and certain other legal
matters will be passed upon for the Seller by , a
of ,
and for the Underwriters by Orrick, Herrington & Sutcliffe LLP, New York, New
York. From time to time Simpson Thacher & Bartlett and Orrick, Herrington &
Sutcliffe LLP will provide legal services to the Seller and its affiliates.
S-29
<PAGE>
[This page intentionally left blank]
S-30
<PAGE>
INDEX OF TERMS
[TO BE REVISED]
<TABLE>
<CAPTION>
TERM PAGE
- - - --------------------------------------------- --------
<S> <C>
Advance...................................... S-19
Aggregate Net Losses......................... S-15
Agreement.................................... S-1
Available Interest........................... S-17
Available Principal.......................... S-17
Available Reserve Account Amount............. S-15
Average Delinquency Percentage............... S-15
Average Net Loss Ratio....................... S-15
Bank......................................... S-1
Base Rate.................................... S-20
Business Day................................. S-2
Cede......................................... ii
Cedel........................................ i
Certificateholder............................ S-20
Certificateholders........................... S-2
Certificates................................. i
Chase........................................ S-14
Chase USA.................................... S-1
Class A Certificate Balance.................. S-2
Class A Certificateholders................... S-2
Class A Certificates......................... i
Class A Distribution Account................. S-14
Class A Interest Carryover Shortfall......... S-17
Class A Interest Distributable Amount........ S-17
Class A Monthly Interest..................... S-17
Class A Monthly Principal.................... S-17
Class A Pass-Through Rate.................... S-2
Class A Percentage........................... S-1
Class A Principal Carryover Shortfall........ S-17
Class A Principal Distributable Amount....... S-17
Class A Underwriters......................... S-26
Class B Certificate Balance.................. S-2
Class B Certificateholders................... S-2
Class B Certificates......................... i
Class B Distribution Account................. S-14
Class B Interest Carryover Shortfall......... S-17
Class B Interest Distributable Amount........ S-17
Class B Monthly Interest..................... S-17
Class B Monthly Principal.................... S-17
Class B Pass-Through Rate.................... S-2
Class B Percentage........................... S-1
Class B Principal Carryover Shortfall........ S-17
Class B Principal Distributable Amount....... S-18
Class B Stripped Coupon...................... S-21
Class B Underwriter.......................... S-26
Closing Date................................. i
Code......................................... S-20
Collateral Agent............................. S-1
Collection Account........................... S-14
Collection Period............................ S-3
</TABLE>
S-31
<PAGE>
<TABLE>
<CAPTION>
TERM PAGE
- - - --------------------------------------------- --------
<S> <C>
Contract Rate................................ S-7
Cutoff Date.................................. ii
Delinquency Percentage....................... S-15
Direct Receivables...........................
Distribution Accounts........................ S-14
DOL.......................................... S-24
DTC.......................................... i
Euroclear.................................... i
Exemption.................................... S-24
Exemption Rating Agency...................... S-26
FDIC......................................... i
Federal Tax Counsel.......................... S-20
Final Scheduled Maturity Date................ S-3
Final Scheduled Distribution Date............ ii
Financed Vehicles............................ S-3
IRS.......................................... S-20
Liquidation Proceeds......................... S-16
Net Loss Ratio............................... S-16
Original Pool Balance........................ S-4
Outstanding Advances......................... S-3
Pass-Through Rate............................ S-2
Paying Agent................................. S-14
Payment Deficiencies......................... S-15
Plan Asset Regulation........................ S-24
Plan Assets.................................. S-24
Plans........................................ S-24
Pool Balance................................. S-3
Pooling and Servicing Agreement.............. S-3
Purchase Price............................... S-21
Rating Agency................................ S-4
Receivables Pool............................. S-6
Record Date.................................. S-2
Reserve Account.............................. S-3
Reserve Account Initial Deposit.............. S-3
Restricted Group............................. S-25
Retained Yield............................... S-20
Seller....................................... i, S-1
Servicer..................................... i, S-1
Servicing Fee Rate........................... S-18
Settlement Date.............................. S-3
Shortfall Amount............................. S-6
Specified Reserve Account Balance............ S-4
Trust........................................ i, S-1
Trustee...................................... S-1, S-4
U.S.......................................... S-20
Underwriters................................. S-26
Underwriting Agreement....................... S-26
</TABLE>
S-32
<PAGE>
ANNEX A
GLOBAL CLEARANCE, SETTLEMENT AND
TAX DOCUMENTATION PROCEDURES
Except in certain limited circumstances, the globally offered Chase
Manhattan Grantor Trust 199 - Automobile Loan Pass-Through Certificates, Class A
and Class B (collectively, the 'GLOBAL SECURITIES') to be issued will be
available only in book-entry form. Investors in the Global Securities may hold
such Global Securities through any of DTC, Cedel, or Euroclear. The Global
Securities will be tradeable as home market instruments in both the European and
U.S. domestic markets. Initial settlement and all secondary trades will settle
in same-day funds.
Secondary market trading between investors holding Global Securities
through Cedel and Euroclear will be conducted in the ordinary way in accordance
with their normal rules and operating procedures and in accordance with
conventional eurobond practice (i.e., seven calendar day settlement).
Secondary market trading between investors holding Global Securities
through DTC will be conducted according to the rules and procedures applicable
to U.S. corporate debt obligations.
Secondary cross-market trading between Cedel or Euroclear and DTC
Participants holding Global Securities will be effected on a
delivery-against-payment basis through the respective Depositaries of Cedel and
Euroclear (in such capacity) and as DTC Participants.
Non-U.S. holders (as described below) of Global Securities will be subject
to U.S. withholding taxes unless such holders meet certain requirements and
deliver appropriate U.S. tax documents to the securities clearing corporation
organizations or their participants.
INITIAL SETTLEMENT
All Global Securities will be held in book-entry form by DTC in the name of
Cede & Co. as nominee or DTC. Investors' interests in the Global Securities will
be represented through financial institutions acting on their behalf as direct
and indirect Participants in DTC. As a result, Cedel and Euroclear will hold
positions on behalf of their participants through their respective Depositaries,
which in turn will hold such positions in accounts as DTC Participants.
Investors electing to hold their Global Securities through DTC will follow
the settlement practice applicable to U.S. corporate debt obligations. Investor
securities custody accounts will be credited with the holdings against payment
in same-day funds on the settlement date.
Investors electing to hold their Global Securities through Cedel or
Euroclear accounts will follow the settlement procedures applicable to
conventional eurobonds, except that there will be no temporary global security
and no 'lock-up' or restricted period. Global Securities will be credited to the
securities custody accounts on the settlement date against payment in same-day
funds.
SECONDARY MARKET TRADING
Since the purchaser determines the place of delivery, it is important to
establish at the time of the trade where both the purchaser's and seller's
accounts are located to ensure that settlement can be made on the desired value
date.
Trading between DTC Participants. Secondary market trading between DTC
Participants will be settled using the procedures applicable to U.S. corporate
debt obligations in same-day funds.
Trading between Cedel and/or Euroclear Participants. Secondary market
trading between Cedel Participants or Euroclear Participants will be settled
using the procedures applicable to conventional eurobonds in same-day funds.
Trading between DTC seller and Cedel or Euroclear purchaser. When Global
Securities are to be transferred from the account of a DTC Participant to the
account of a Cedel Participant or a Euroclear Participant, the purchaser will
send instructions to Cedel or Euroclear, through a Cedel Participant or
Euroclear Participant, at least one business day prior to settlement. Cedel or
Euroclear will instruct the respective Depositary to receive the Global
Securities against payment. Payment will include interest accrued on the Global
Securities from and
S-A-1
<PAGE>
including the last coupon payment date to and excluding the settlement date.
Payment will then be made by the respective Depositary to the DTC Participant's
account against delivery of the Global Securities. After settlement has been
completed, the Global Securities will be credited to the respective clearing
system and by the clearing system, in accordance with its usual procedures, to
the Cedel Participant's or Euroclear Participant's account. The Global
Securities credit will appear the next day (European time) and the cash debit
will be backed-valued to, and the interest on the Global Securities will accrue
from, the value date (which would be the preceding day when settlement occurred
in New York). If settlement is not completed on the intended value date (i.e.,
the trade fails), the Cedel or Euroclear cash debit will be valued instead as of
the actual settlement date.
Cedel Participants and Euroclear Participants will need to make available
to the respective clearing systems the funds necessary to process same-day funds
settlement. The most direct means of doing so is to preposition funds for
settlement, either from cash on hand or existing lines of credit, as they would
for any settlement occurring within Cedel or Euroclear. Under this approach,
they may take on credit exposure to Cedel or Euroclear until the Global
Securities are credited to their accounts one day later.
As an alternative, if Cedel or Euroclear has extended a line of credit to
them, Cedel Participants or Euroclear Participants can elect not to preposition
funds and allow that credit line to be drawn upon the finance settlement. Under
this procedure, Cedel Participants or Euroclear Participants purchasing Global
Securities would incur overdraft charges for one day, assuming they cleared the
overdraft when the Global Securities were credited to their accounts. However,
interest on the Global Securities would accrue from the value date. Therefore,
in many cases the investment income on the Global Securities earned during the
one-day period may substantially reduce or offset the amount of such overdraft
charges, although this result will depend on each Cedel Participant's or
Euroclear Participant's particular cost of funds.
Since the settlement is taking place during New York business hours, DTC
Participants can employ their usual procedures for sending Global Securities to
the respective Depositary for the benefit of Cedel Participants or Euroclear
Participants. The sale proceeds will be available to the DTC seller on the
settlement date. Thus, to the DTC Participant a cross-market transaction will
settle no differently than a trade between two DTC Participants.
Trading between Cedel or Euroclear seller and DTC purchaser. Due to time
zone differences in their favor, Cedel Participants and Euroclear Participants
may employ their customary procedures for transactions in which Global
Securities are to be transferred by the respective clearing system, through the
respective Depositary, to a DTC Participant. The seller will send instructions
to Cedel or Euroclear, through a Cedel Participant or Euroclear Participant, at
least one business day prior to settlement. In these cases, Cedel or Euroclear
will instruct the respective Depositary, as appropriate, to deliver the bonds to
the DTC Participant's account against payment. Payment will include interest
accrued on the Global Securities from and including the last coupon payment date
to and excluding the settlement date. The payment will then be reflected in the
account of the Cedel Participant or Euroclear Participant the following day, and
receipt of the cash proceeds in the Cedel Participant's or Euroclear
Participant's account would be back-valued to the value date (which would be the
preceding day, when settlement occurred in New York). Should the Cedel
Participant or Euroclear Participant have a line of credit with its respective
clearing system and elect to be in debit in anticipation of receipt of the sale
proceeds in its account, the back-valuation will extinguish any overdraft
charges incurred over that one-day period. If settlement is not completed on the
intended value date (i.e., the trade fails), receipt of the cash proceeds in the
Cedel Participant's or Euroclear Participant's account would instead be valued
as of the actual settlement date.
Finally, day traders that use Cedel or Euroclear and that purchase Global
Securities from DTC Participants for delivery to Cedel Participants or Euroclear
Participants should note that these trades would automatically fail on the sale
side unless affirmative action were taken. At least three techniques should be
readily available to eliminate this potential problem:
(a) borrowing through Cedel or Euroclear for one day (until the
purchase side of the day trade is reflected in their Cedel or Euroclear
accounts) in accordance with the clearing system's custom procedures;
(b) borrowing the Global Securities in the U.S. from a DTC Participant
no later than one day prior to settlement, which would give the Global
Securities sufficient time to be reflected in their Cedel Euroclear account
in order to settle the sale side of the trade; or
S-A-2
<PAGE>
(c) staggering the value dates for the buy and sell sides of the trade
so that the value date for the purchase from the DTC Participant is at
least one day prior to the value date for the sale to the Cedel Participant
or Euroclear Participant.
CERTAIN U.S. FEDERAL INCOME TAX DOCUMENTATION REQUIREMENTS
A beneficial owner of Global Securities holding securities through Cedel or
Euroclear (or through DTC if the holder has an address outside the U.S.) will be
subject to the 30% U.S. withholding tax that generally applies to payments of
interest (including original issue discount) on registered debt issued by U.S.
Persons, unless (i) each clearing system, bank or other financial institution
that holds customers' securities in the ordinary course of its trade or business
in the chain of intermediaries between such beneficial owner and the U.S. entity
required to withhold tax complies with applicable certification requirements and
(ii) such beneficial owner takes one of the following steps to obtain an
exemption or reduced tax rate:
Exemption for non-U.S. Persons (Form W-8). Beneficial owners of
Certificates that are non-U.S. Persons can obtain a complete exemption from the
withholding tax by filing a signed Form W-8 (Certificate of Foreign Status). If
the information shown on Form W-8 changes, a new Form W-8 must be filed within
30 days of such change.
Exemption for non-U.S. Persons with effectively connected income (Form
4224). A non-U.S. Person, including a non-U.S. corporation or bank with a U.S.
branch, for which the interest income is effectively connected with its conduct
of a trade or business in the United States, can obtain an exemption from the
withholding tax by filing Form 4224 (Exemption from Withholding of Tax on Income
Effectively Connected with the Conduct of a Trade or Business in the United
States).
Exemption or reduced rate for non-U.S. Persons resident in treaty countries
(Form 1001). Non-U.S. Persons that are Certificate Owners residing in a country
that has a tax treaty with the United States can obtain an exemption or reduced
tax rate (depending on the treaty terms) by filing Form 1001 (Ownership,
Exemption of Reduced Rate Certificate). If the treaty provides only for a
reduced rate, withholding tax will be imposed at that rate unless the filer
alternatively files Form W-8. Form 1001 may be filed by the Certificate Owner or
his agent.
Exemption for U.S. Persons (Form W-9). U.S. Persons can obtain a complete
exemption from the withholding tax by filing Form W-9 (Payer's Request for
Taxpayer Identification Number and Certification).
U.S. Federal Income Tax Reporting Procedure. The Certificate Owner of a
Global Security or, in the case of a Form 1001 or a Form 4224 filer, his agent,
files by submitting the appropriate form to the person through whom it holds
(the clearing agency, in the case of persons holding directly on the books of
the clearing agency). Form W-8 and Form 1001 are effective for three calendar
years and Form 4224 is effective for one calendar year.
The term 'U.S. Person' means (i) a citizen or resident of the United
States, (ii) a corporation or partnership organized in or under the laws of the
United States or any political subdivision thereof or (iii) an estate or trust
the income of which is includible in gross income for United States tax
purposes, regardless of its source. This summary does not deal with all aspects
of U.S. Federal income tax withholding that may be relevant to foreign holders
of the Global Securities. Investors are advised to consult their own tax
advisors for specific tax advice concerning their holding and disposing of the
Global Securities.
S-A-3
[TO BE INSERTED IF CERTIFICATES ARE LISTED ON
THE LUXEMBOURG STOCK EXCHANGE]
PRINCIPAL OFFICE OF
CHASE MANHATTAN BANK USA, NATIONAL ASSOCIATION
802 Delaware Avenue
Wilmington, Delaware 19801
OWNER TRUSTEE
INDENTURE TRUSTEE
PAYING AGENT AND TRANSFER AGENT
The Chase Manhattan Bank
450 West 33rd Street
New York, New York 10036
LISTING AND INTERMEDIARY AGENT
Banque Generale du Luxembourg, S.A.
50 Avenue J.F. Kennedy
L-2951 Luxembourg
LEGAL ADVISOR TO THE SELLER
AS TO UNITED STATES LAW
Simpson Thacher & Bartlett
425 Lexington Avenue
New York, New York 10017
LEGAL ADVISOR TO THE UNDERWRITERS
AS TO UNITED STATES LAW
Orrick, Herrington & Sutcliffe LLP
666 Fifth Avenue
New York, New York 10103
INDEPENDENT ACCOUNTANTS TO THE SELLER
Price Waterhouse LLP
1177 Avenue of the Americas
New York, New York 10036
<PAGE>
------------------------------------------------------
------------------------------------------------------
NO DEALER, SALESPERSON OR OTHER INDIVIDUAL HAS BEEN AUTHORIZED TO GIVE ANY
INFORMATION OR TO MAKE ANY REPRESENTATIONS OTHER THAN THOSE CONTAINED OR
INCORPORATED BY REFERENCE IN THIS PROSPECTUS SUPPLEMENT OR THE PROSPECTUS AND,
IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATIONS MUST NOT BE RELIED UPON AS
HAVING BEEN AUTHORIZED BY THE SELLER OR THE UNDERWRITERS. NEITHER THE DELIVERY
OF THIS PROSPECTUS SUPPLEMENT OR THE PROSPECTUS NOR ANY SALE MADE HEREUNDER
SHALL UNDER ANY CIRCUMSTANCE CREATE AN IMPLICATION THAT THERE HAS BEEN NO CHANGE
IN THE AFFAIRS OF THE SELLER OR THE RECEIVABLES SINCE THE DATE THEREOF. THIS
PROSPECTUS SUPPLEMENT AND THE PROSPECTUS DO NOT CONSTITUTE AN OFFER OR
SOLICITATION BY ANYONE IN ANY STATE IN WHICH SUCH OFFER OR SOLICITATION IS NOT
AUTHORIZED OR IN WHICH THE PERSON MAKING SUCH OFFER OR SOLICITATION IS NOT
QUALIFIED TO DO SO OR TO ANYONE TO WHOM IT IS UNLAWFUL TO MAKE SUCH OFFER OR
SOLICITATION.
- - - ------------------------------------------------------
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
-----
<S> <C>
Prospectus Supplement......................................... i
Summary of Terms.............................................. S-1
Risk Factors.................................................. S-6
The Trust..................................................... S-7
The Receivables Pool.......................................... S-8
Chase USA..................................................... S-14
Use of Proceeds............................................... S-14
Weighted Average Life of the Certificates..................... S-14
Yield Considerations.......................................... S-14
Description of the Certificates............................... S-14
Description of the Pooling and Servicing Agreement............ S-19
Certain Federal Income Tax Consequences....................... S-21
Certain State Tax Consequences................................ S-25
ERISA Considerations.......................................... S-25
Listing and General Information...............................
Underwriting.................................................. S-28
Legal Matters................................................. S-29
Index of Terms................................................ S-31
Annex A....................................................... S-A-1
Prospectus.................................................... 1
Summary of Prospectus......................................... 6
Risk Factors.................................................. 13
The Trusts.................................................... 16
The Receivables Pools......................................... 17
Weighted Average Life of the Securities....................... 23
Pool Factors and Trading Information.......................... 25
Use of Proceeds............................................... 25
Chase USA..................................................... 26
Description of the Notes...................................... 26
Description of the Certificates............................... 31
Certain Information Regarding the Securities.................. 32
Description of the Transfer and Servicing Agreements.......... 39
Certain Legal Aspects of the Receivables...................... 51
ERISA Considerations.......................................... 53
Plan of Distribution.......................................... 54
Ratings....................................................... 55
Legal Matters................................................. 55
Index of Terms................................................ 56
</TABLE>
UNTIL , 199 (90 DAYS AFTER THE DATE OF THIS PROSPECTUS
SUPPLEMENT) ALL DEALERS EFFECTING TRANSACTIONS IN THE CERTIFICATES, WHETHER OR
NOT PARTICIPATING IN THIS DISTRIBUTION, MAY BE REQUIRED TO DELIVER THIS
PROSPECTUS SUPPLEMENT AND THE PROSPECTUS. THIS DELIVERY REQUIREMENT IS IN
ADDITION TO THE OBLIGATION OF DEALERS TO DELIVER THIS PROSPECTUS SUPPLEMENT AND
THE PROSPECTUS WHEN ACTING AS UNDERWRITERS AND WITH RESPECT TO THEIR UNSOLD
ALLOTMENTS OR SUBSCRIPTIONS.
------------------------------------------------------
------------------------------------------------------
------------------------------------------------------
------------------------------------------------------
PROSPECTUS SUPPLEMENT
CHASE MANHATTAN AUTO
GRANTOR TRUST 199 -
$ %
AUTOMOBILE LOAN PASS-THROUGH
CERTIFICATES, CLASS A
$ %
AUTOMOBILE LOAN PASS-THROUGH
CERTIFICATES, CLASS B
CHASE MANHATTAN BANK USA,
NATIONAL ASSOCIATION
SELLER AND SERVICER
Underwriters of the Class A Certificates
Underwriters of the Class B Certificates
, 199
------------------------------------------------------
------------------------------------------------------
<PAGE>
INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A
REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR MAY
OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT BECOMES
EFFECTIVE AND WITHOUT DELIVERY OF A FINAL PROSPECTUS SUPPLEMENT AND
ACCOMPANYING PROSPECTUS. THIS PROSPECTUS SUPPLEMENT AND THE ACCOMPANYING
PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR THE SOLICITATION OF AN OFFER
TO BUY NOR SHALL THERE BE ANY SALE OF THESE SECURITIES IN ANY STATE IN WHICH
SUCH OFFER, SOLICITATION OR SALE WOULD BE UNLAWFUL PRIOR TO REGISTRATION OR
QUALIFICATION UNDER THE SECURITIES LAWS OF ANY SUCH STATE.
SUBJECT TO COMPLETION, DATED SEPTEMBER 29, 1997
PROSPECTUS SUPPLEMENT
(To Prospectus dated , 199 ) FORM B--OWNER TRUST/NOTES AND CERTIFICATES
$
CHASE MANHATTAN AUTO OWNER TRUST 199 -
$ CLASS A-1 % ASSET BACKED NOTES
$ CLASS A-2 % ASSET BACKED NOTES
$ CLASS A-3 % ASSET BACKED NOTES
$ CLASS A-4 % ASSET BACKED NOTES
$ CLASS A-5 % ASSET BACKED NOTES
$ % ASSET BACKED CERTIFICATES
CHASE MANHATTAN BANK USA, NATIONAL ASSOCIATION
SELLER AND SERVICER
The Chase Manhattan Auto Owner Trust 199 - (the 'TRUST') will be formed pursuant
to a Trust Agreement, to be dated as of , 199 between Chase Manhattan Bank
USA, National Association (the 'SELLER') and , as Owner
Trustee. The Trust will issue
(continued on the following page)
- - - --------------------------------------------------------------------------------
There currently is no secondary market for the Securities and there is no
assurance that one will develop.
The Underwriters expect, but are not obligated, to make a market in the
Securities, and there is no assurance that any such market will develop or
continue.
THE NOTES REPRESENT OBLIGATIONS OF, AND THE CERTIFICATES REPRESENT BENEFICIAL
INTERESTS IN, THE TRUST ONLY AND DO NOT REPRESENT OBLIGATIONS OF OR INTERESTS IN
CHASE MANHATTAN BANK USA, NATIONAL ASSOCIATION, THE CHASE MANHATTAN BANK, OR ANY
AFFILIATE THEREOF. NONE OF THE NOTES OR CERTIFICATES IS A DEPOSIT AND NONE OF
THE NOTES OR CERTIFICATES IS INSURED BY THE FEDERAL DEPOSIT INSURANCE
CORPORATION (THE 'FDIC'). THE RECEIVABLES ARE NOT INSURED OR GUARANTEED BY THE
FDIC OR ANY OTHER GOVERNMENTAL AGENCY.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS SUPPLEMENT OR THE PROSPECTUS. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
- - - --------------------------------------------------------------------------------
PROSPECTIVE INVESTORS SHOULD CONSIDER, AMONG OTHER THINGS, THE INFORMATION SET
FORTH UNDER THE HEADING 'RISK FACTORS' IN THIS PROSPECTUS SUPPLEMENT COMMENCING
ON PAGE S-9 AND COMMENCING ON PAGE 13 OF THE ACCOMPANYING PROSPECTUS.
- - - --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
UNDERWRITING DISCOUNT PROCEEDS TO THE
PRICE TO PUBLIC(1) AND COMMISSIONS SELLER(1)(2)
<S> <C> <C> <C>
PER CLASS A-1 NOTE % % %
PER CLASS A-2 NOTE % % %
PER CLASS A-3 NOTE % % %
PER CLASS A-4 NOTE % % %
PER CLASS A-5 NOTE % % %
PER CERTIFICATE % % %
TOTAL $ $ $
</TABLE>
(1) Plus accrued interest, if any, from , 199 .
(2) Before deduction of expenses estimated at $ .
- - - --------------------------------------------------------------------------------
[This Prospectus Supplement may be used by Chase Securities Inc., an affiliate
of the Seller and a subsidiary of The Chase Manhattan Corporation, in connection
with offers and sales related to market-making transactions in the Notes and the
Certificates. Chase Securities Inc. may act as principal or agent in such
transactions. Such sales will be made at prices related to prevailing market
prices at the time of sale.]
The Notes and Certificates are being offered by the Underwriters, subject to
prior sale, when, as and if issued to and accepted by the Underwriters, subject
to approval of certain legal matters by counsel for the Underwriters. The
Underwriters reserve the right to reject orders in whole or in part. It is
expected that the Notes and the Certificates will be delivered in book-entry
form, on or about , 199 (the 'CLOSING DATE') through the facilities of The
Depository Trust Company ('DTC'), Cedel Bank, societe anonyme ('CEDEL') or the
Euroclear System ('EUROCLEAR') in the case of the Notes, or DTC, in the case of
the Certificates, in each case against payment therefor in immediately available
funds.
Underwriters of the Notes
Underwriter of the Certificates
THE DATE OF THIS PROSPECTUS SUPPLEMENT IS , 199 .
<PAGE>
(included from prior page)
$ aggregate principal amount of Class A-1 % Asset Backed Notes
(the 'CLASS A-1 NOTES'), $ aggregate principal amount of Class A-2
% Asset Backed Notes (the 'CLASS A-2 NOTES'), $ aggregate
principal amount of Class A-3 % Asset Backed Notes (the 'CLASS A-3 NOTES'),
$ aggregate principal amount of Class A-4 % Asset Backed Notes
(the 'CLASS A-4 NOTES') and $ aggregate principal amount of Class A-5
% Asset Backed Notes (the 'CLASS A-5 NOTES' and, together with the Class
A-1 Notes, the Class A-2 Notes, Class A-3 Notes and Class A-4 Notes, the
'NOTES') pursuant to an Indenture to be dated as of , 199 , between the
Trust and , , as Indenture Trustee.
The Trust will also issue $ aggregate principal amount of %
Asset Backed Certificates (the 'CERTIFICATES' and, together with the Notes, the
'SECURITIES'). The assets of the Trust will include a pool of retail installment
sales contracts and purchase money notes and other notes secured by new and used
automobiles and light-duty trucks, certain monies received thereunder on and
after , 199 (the 'CUTOFF DATE'), security interests in the vehicles
financed thereby, amounts on deposit in certain accounts and proceeds from
claims on certain insurance policies, all as more fully described herein. The
Notes will be secured by the assets of the Trust pursuant to the Indenture.
Interest on all classes of Notes will accrue at the fixed per annum
interest rates specified above. Interest on the Notes will generally be payable
on the 15th day of each month (each, a 'DISTRIBUTION DATE'), commencing ,
199 .
Principal of the Notes will be payable on each Distribution Date to the
extent described herein, except that no principal will be paid on the Class A-2
Notes until the Class A-1 Notes have been paid in full, no principal will be
paid on the Class A-3 Notes until the Class A-2 Notes have been paid in full, no
principal will be paid on the Class A-4 Notes until the Class A-3 Notes have
been paid in full and no principal will be paid on the Class A-5 Notes until the
Class A-4 Notes have been paid in full.
The Certificates will represent fractional undivided interests in the
Trust. Interest, to the extent of the Certificate Rate (as defined herein), will
be generally distributed to the Certificateholders (as defined herein) on each
Distribution Date. Principal, to the extent described herein, will be
distributed to the Certificateholders on each Distribution Date commencing with
the Distribution Date on which the Notes have been paid in full. Distributions
of interest and principal on the Certificates will be subordinated to payments
due on the Notes to the extent described herein.
The Class A-1 Notes will be payable in full on the Distribution
Date [(which will be with respect to the Class A-1 Notes)], the
Class A-2 Notes will be payable in full on the Distribution Date,
the Class A-3 Notes will be payable in full on the Distribution
Date, the Class A-4 Notes will be payable in full on the
Distribution Date and the Class A-5 Notes will be payable in full on the
Distribution Date. The final scheduled Distribution Date with
respect to the Certificates will be the Distribution Date.
Investors should be aware that payment in full of a class of Notes or the
Certificates could occur earlier than such dates as described herein. In
addition, the Class A-5 Notes and the Certificates will be subject to prepayment
in whole, but not in part, on any Distribution Date on which Chase Manhattan
Bank USA, National Association, in its capacity as servicer (in such capacity,
the 'SERVICER'), exercises its option to purchase the Receivables. The Servicer
may purchase all the Receivables on any Distribution Date on which the Pool
Balance (as defined herein) shall have declined to 5% or less of the Original
Pool Balance (as defined herein).
The Issuer, a newly-formed limited purpose Delaware business trust,
generally will be prohibited from incurring any indebtedness other than the
Notes, and its assets will include the Receivables and related property, the
Collection Account, [the Paid-Ahead Account,] the Note Distribution Account, the
Certificate Distribution Account and the Reserve Account, as described herein.
The Securities initially will be represented by Notes and Certificates
registered in the name of Cede & Co., the nominee of DTC. The interests of
beneficial owners of the Securities will be represented by book entries on the
records of DTC and participating members thereof. Definitive Notes or Definitive
Certificates will be available only under the limited circumstances described
herein.
[Application will be made to list the Notes on the Luxembourg Stock
Exchange.]
ii
<PAGE>
THIS PROSPECTUS SUPPLEMENT DOES NOT CONTAIN COMPLETE INFORMATION ABOUT THE
OFFERING OF THE NOTES AND THE CERTIFICATES. ADDITIONAL INFORMATION IS CONTAINED
IN THE PROSPECTUS, AND PROSPECTIVE INVESTORS ARE URGED TO READ BOTH THIS
PROSPECTUS SUPPLEMENT AND THE PROSPECTUS IN FULL. SALES OF THE NOTES OR THE
CERTIFICATES MAY NOT BE CONSUMMATED UNLESS THE PURCHASER HAS RECEIVED BOTH THIS
PROSPECTUS SUPPLEMENT AND THE PROSPECTUS.
CERTAIN PERSONS PARTICIPATING IN THIS OFFERING MAY ENGAGE IN TRANSACTIONS
THAT STABILIZE, MAINTAIN, OR OTHERWISE AFFECT THE PRICE OF THE SECURITIES,
INCLUDING OVER-ALLOTMENT TRANSACTIONS, STABILIZING TRANSACTIONS, SYNDICATE
COVERING TRANSACTIONS AND PENALTY BIDS. FOR A DESCRIPTION OF THESE ACTIVITIES,
SEE 'UNDERWRITING' HEREIN.
Upon receipt of a request by an investor, or his or her representative,
within the period during which there is a prospectus delivery obligation, the
Underwriters will transmit or cause to be transmitted promptly, without charge
and in addition to any such delivery requirements, a paper copy of this
Prospectus Supplement and a Prospectus or this Prospectus Supplement and a
Prospectus encoded in an electronic format.
SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS
Certain of the matters discussed under the captions 'The Receivables
Pool--Delinquencies and Loan Loss Information' and 'Weighted Average Life of the
Securities' in this Prospectus Supplement may constitute forward-looking
statements within the meaning of Section 7A of the Securities Act, and as such
may involve known and unknown risks, uncertainties and other factors which may
cause the actual results, performance or achievements of the Receivables to be
materially different from any future results, performance or achievements
expressed or implied by such forward-looking statements.
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SUMMARY OF TERMS
This Summary of Terms is qualified in its entirety by reference to the
detailed information appearing elsewhere herein and in the Prospectus. Certain
capitalized terms used in this Summary are defined elsewhere in this Prospectus
Supplement on the pages indicated in the 'Index of Terms' or, to the extent not
defined herein, have the meanings assigned to such terms in the Prospectus.
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ISSUER.................. The Chase Manhattan Auto Owner Trust 199 - (the 'TRUST'
or the 'ISSUER'), a Delaware business trust established
pursuant to a trust agreement (as amended and
supplemented, the 'TRUST AGREEMENT'), dated as of
, 199 between the Seller and the Owner Trustee.
SELLER.................. Chase Manhattan Bank USA, National Association ('CHASE
USA'), a national banking association headquartered in
Delaware and a wholly-owned subsidiary of The Chase
Manhattan Corporation (in such capacity, the 'SELLER,'
or individually, the 'BANK').
SERVICER................ Chase USA (in such capacity, the 'SERVICER').
INDENTURE TRUSTEE....... , as trustee under the Indenture (the 'INDENTURE
TRUSTEE'). The Indenture Trustee's Corporate Trust
Office is located at
,
, telephone . The
Bank and its affiliates may have normal banking
relationships with the Indenture Trustee and its
affiliates.
OWNER TRUSTEE........... , as trustee under the Trust Agreement (the 'OWNER
TRUSTEE'). The Owner Trustee's Corporate Trust Office
is located at
, telephone
. The Bank and its affiliates may have
normal banking relationships with the Owner Trustee and
its affiliates.
THE NOTES............... Class A-1 % Asset Backed Notes in the aggregate
principal amount of $ .
Class A-2 % Asset Backed Notes in the aggregate
principal amount of $ .
Class A-3 % Asset Backed Notes in the aggregate
principal amount of $ .
Class A-4 % Asset Backed Notes in the aggregate
principal amount of $ .
Class A-5 % Asset Backed Notes in the aggregate
principal amount of $ .
The Notes will be issued by the Trust pursuant to an
Indenture to be dated as of , 199 (the
'INDENTURE'), between the Trust and the Indenture
Trustee. The Notes will be secured by the assets of the
Trust.
The Notes will be available for purchase in book-entry
form only in minimum denominations of $1,000 and
integral multiples thereof. The Noteholders will not be
entitled to receive Definitive Notes, except in the
limited circumstances described in the Prospectus.
Noteholders may elect to hold their Notes through DTC
(in the United States) or Cedel or Euroclear (in
Europe). All references herein to Noteholders shall
reflect the rights of Noteholders, as such rights may
be exercised through DTC and its Participants
(including Cedel and Euroclear), except as otherwise
specified herein and in the Prospectus. See
'Description of the Notes--General' and 'Certain
Information Regarding the Securities-- Book-Entry
Registration' in the Prospectus.
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THE CERTIFICATES........ % Asset Backed Certificates with an initial Certificate
Balance of $ . The Certificates will
represent fractional undivided interests in the Trust
and will be issued pursuant to the Trust Agreement.
The Certificates will be available for purchase in
minimum denominations of $1,000 and integral multiples
of $1,000 in excess thereof. The Certificateholders
will not be entitled to receive Definitive
Certificates, except in the limited circumstances
described in the Prospectus. All references herein to
Certificateholders shall reflect the rights of
Certificateholders, as such rights may be exercised
through DTC and its Participants, except as otherwise
specified herein and in the Prospectus. See
'Description of the Certificates-- General' and
'Certain Information Regarding the
Securities--Book-Entry Registration' in the Prospectus.
No beneficial interest in a Certificate may be held
directly or indirectly by a Foreign Investor.
Purchasers of Certificates and their assignees will be
deemed to represent (i) that the beneficial owners of
such Certificates are not Foreign Investors, and (ii)
that they are not a Plan and that no assets of a Plan
were used to acquire the Certificates.
The rights of Certificateholders to receive
distributions with respect to the Certificates will be
subordinated to the rights of the Noteholders to
receive interest on and principal of the Notes in the
manner described herein.
THE TRUST............... The Trust is a business trust established under the
laws of Delaware pursuant to the Trust Agreement. The
activities of the Trust are limited by the terms of the
Trust Agreement to acquiring, owning and managing the
Receivables, issuing and making payments on the Notes
and Certificates and other activities related thereto.
The assets of the Trust will include (i) the
Receivables, (ii) all monies received thereunder on and
after the Cutoff Date, (iii) such amounts as from time
to time may be held in one or more Trust Accounts
established and maintained pursuant to the Sale and
Servicing Agreement, as described herein, (iv) security
interests in the Financed Vehicles, (v) the Seller's
proceeds from the exercise of the Seller's recourse
rights against Dealers, (vi) proceeds from claims on
certain insurance policies, (vii) rights with respect
to repossessed Financed Vehicles, and (viii) any and
all proceeds of the foregoing.
THE RECEIVABLES......... The Receivables will consist of retail installment
sales contracts and purchase money notes and other
notes secured by new and used automobiles and light-
duty trucks (the 'FINANCED VEHICLES'). On the Closing
Date, the Seller will transfer Receivables having an
aggregate principal balance of approximately
$ as of the Cutoff Date to the Trust in
exchange for the Securities pursuant to a Sale and
Servicing Agreement to be dated as of , 199 (as
amended and supplemented from time to time, the 'SALE
AND SERVICING AGREEMENT'), among the Trust, the Seller
and the Servicer. See 'Description of the Transfer and
Servicing Agreements' herein and in the Prospectus.
The Receivables have been selected from the contracts
owned by the Bank based on the criteria specified in
the Sale and Servicing Agreement and described herein
and in the Prospectus. See 'The Receivables Pool'
herein and 'The Receivables Pools' in the Prospectus.
No Receivable will have a scheduled maturity that,
after giving prospective effect to any permitted
extensions or deferrals, would be later than
(the 'FINAL SCHEDULED MATURITY
DATE'). As of the Cutoff Date, the weighted average
remaining maturity of the Receivables was approximately
months and the weighted average original maturity
of the Receivables was approximately months. As of
the Cutoff Date, approximately % of the Original
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Pool Balance were secured by used Financed Vehicles and
the remainder were secured by new Financed Vehicles.
The 'POOL BALANCE' at any time will represent the
aggregate principal balance of the Receivables as of
the close of business on the last day of the preceding
Collection Period, after giving effect to all payments
received from Obligors and Repurchase Amounts to be
remitted by the Servicer or the Seller, as the case may
be, for such Collection Period and all losses realized
on Receivables liquidated during such Collection
Period. The aggregate principal balance of the
Receivables as of the Cutoff Date (the 'ORIGINAL POOL
BALANCE') was $ .
TERMS OF THE NOTES...... The principal terms of the Notes are described below:
Distribution Dates. Payments of interest and principal
on the Notes will be made on the 15th day of each month
or, if any such day is not a Business Day, on the next
succeeding Business Day, commencing , 199 [;
provided, however, that, for purposes of making payment
of interest and the final payment of principal on the
Class A-1 Notes, the Distribution Date with respect to
the Class A-1 Notes will be , 199 ]. Payments
will be made to holders of record of the Notes (the
'NOTEHOLDERS') as of the day immediately preceding such
Distribution Date or, if Definitive Notes are issued,
as of the last day of the preceding calendar month (a
'RECORD DATE'). A 'BUSINESS DAY' is a day on which
banks located in New York, New York, Wilmington,
Delaware and are open for the
purpose of conducting a commercial banking business.
Interest Rates. The Class A-1 Notes will bear interest
at the rate of % per annum, the Class A-2 Notes
will bear interest at the rate of % per annum, the
Class A-3 Notes will bear interest at the rate of
% per annum, the Class A-4 Notes will bear
interest at the rate of % per annum and the Class
A-5 Notes will bear interest at the rate of % per
annum. The interest rates for all classes of Notes are
referred to herein collectively as 'INTEREST RATES.'
Interest. Interest on the outstanding principal amount
of the Notes of each class will accrue at the related
Interest Rate from and including the Closing Date (in
the case of the first Distribution Date) or from and
including the most recent Distribution Date on which
interest has been paid to but excluding the following
Distribution Date (each an 'INTEREST ACCRUAL PERIOD').
On each Distribution Date, the Indenture Trustee will
distribute pro rata to the Noteholders of each class
accrued interest at the related Interest Rate on the
outstanding principal balance generally to the extent
of funds available therefor as described herein. See
'Description of the Transfer and Servicing
Agreements--Distributions' herein. Interest on the
Class A-1 Notes will be calculated on the basis of a
360-day year based upon the actual number of days
elapsed during the related Interest Accrual Period
[(which will be days with respect to the Interest
Accrual Period for the Distribution Date)]. Interest on
the Class A-2 Notes, Class A-3 Notes, Class A-4 Notes
and Class A-5 Notes will be calculated on the basis of
a 360-day year consisting of twelve 30-day months.
Interest on the Notes of any class for any Distribution
Date due but not paid on such Distribution Date will be
due on the next Distribution Date in addition to an
amount equal to interest on such amount at the
respective Interest Rate (to the extent lawful). See
'Description of the Notes--Payments of Interest' and
'Description of the Transfer and Servicing
Agreements--Distributions' herein.
Principal. Principal of the Notes will be payable on
each Distribution Date in an amount equal to the
Noteholders' Principal Distributable Amount for such
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Distribution Date, to the extent of funds available
therefor as described herein. The Noteholders'
Principal Distributable Amount for a Distribution Date
will equal 100% of the Principal Distributable Amount
for such Distribution Date until the Notes have been
paid in full and will be calculated by the Servicer in
the manner described under 'Description of the Transfer
and Servicing Agreements--Distributions.'
No principal payments will be made on the Class A-2
Notes until the Class A-1 Notes have been paid in full,
no principal payments will be made on the Class A-3
Notes until the Class A-2 Notes have been paid in full,
no principal payments will be made on the Class A-4
Notes until the Class A-3 Notes have been paid in full
and no principal payments will be made on the Class A-5
Notes until the Class A-4 Notes have been paid in full.
The outstanding principal amount of the Class A-1
Notes, to the extent not previously paid, will be
payable on the Distribution Date
[(which will be with respect to
the Class A-1 Notes)] (the 'CLASS A-1 FINAL SCHEDULED
DISTRIBUTION DATE'), the outstanding principal amount
of the Class A-2 Notes, to the extent not previously
paid, will be payable on the
Distribution Date (the 'CLASS A-2 FINAL SCHEDULED
DISTRIBUTION DATE'), the outstanding principal amount
of the Class A-3 Notes, to the extent not previously
paid, will be payable on the
Distribution Date (the 'CLASS A-3 FINAL SCHEDULED
DISTRIBUTION DATE'), the outstanding principal amount
of the Class A-4 Notes, to the extent not previously
paid, will be payable on the
Distribution Date (the 'CLASS A-4 FINAL SCHEDULED
DISTRIBUTION DATE') and the outstanding principal
amount of the Class A-5 Notes, to the extent not
previously paid, will be payable on the
Distribution Date (the 'CLASS A-5
FINAL SCHEDULED DISTRIBUTION DATE' and, together with
the Class A-1 Final Scheduled Distribution Date, the
Class A-2 Final Scheduled Distribution Date, the Class
A-3 Final Scheduled Distribution Date and the Class A-4
Final Scheduled Distribution Date, each a 'NOTE FINAL
SCHEDULED DISTRIBUTION DATE'), in each case from funds
available therefor as described herein (including
amounts on deposit in the Reserve Account).
Optional Redemption. After the Class A-1 Notes, Class
A-2 Notes, Class A-3 Notes and Class A-4 Notes have
been paid in full, the Class A-5 Notes will be redeemed
in whole, but not in part, on any Distribution Date on
which the Servicer exercises its option to purchase the
Receivables, which can occur following the last day of
any Collection Period as of which the Pool Balance
declines to 5% or less of the Original Pool Balance, at
a redemption price equal to the unpaid principal amount
of the Class A-5 Notes plus accrued and unpaid interest
thereon. See 'Description of the Notes--Optional
Redemption' herein.
TERMS OF THE
CERTIFICATES ......... The principal terms of the Certificates are described
below:
Distribution Dates. Distributions with respect to the
Certificates will be made on each Distribution Date,
commencing , 199 . Distributions will be made to
holders of record of the Certificates (the
'CERTIFICATEHOLDERS' and, together with the
Noteholders, the 'SECURITYHOLDERS') as of the related
Record Date.
Certificate Rate. % per annum (the 'CERTIFICATE
RATE').
Interest. Interest in respect of a Distribution Date
will accrue during the related Interest Accrual Period.
On each Distribution Date, the Owner Trustee will
distribute pro rata to Certificateholders accrued
interest at the Certificate Rate on the outstanding
Certificate Balance generally to the extent of funds
available as described herein. Interest will be
calculated on the basis of a 360-day year
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consisting of twelve 30-day months. Payment of interest
on the Certificates is subordinated to payment of
interest on the Notes. If an Event of Default shall
occur and the Notes are accelerated, distributions in
respect of the Certificates will be subordinated in
priority of payment to payment of interest and
principal on the Notes. See 'Description of the
Notes--the Indenture' in the Prospectus. Interest on
the Certificates for any Distribution Date due but not
paid on such Distribution Date will be due on the next
Distribution Date in addition to an amount equal to
interest on such amount at the Certificate Rate (to the
extent lawful).
Principal. No distributions of principal on the
Certificates will be made until the Notes have been
paid in full. On each Distribution Date commencing on
the Distribution Date on which the Notes are paid in
full, principal of the Certificates will be payable in
an amount generally equal to the Certificateholders'
Principal Distributable Amount for such Distribution
Date, to the extent of funds available therefor as
described herein. The Certificateholders' Principal
Distributable Amount for each Distribution Date
generally will equal 100% of the Principal
Distributable Amount (after payment of any outstanding
Notes in full) and will be calculated by the Servicer
in the manner described under 'Description of the
Transfer and Servicing Agreements--Distributions'
herein.
The outstanding principal amount, if any, of the
Certificates is expected to be paid in full on the
Distribution Date (the
'CERTIFICATE FINAL SCHEDULED DISTRIBUTION DATE').
Optional Prepayment. If the Servicer exercises its
option to purchase the Receivables, which can occur
after the Class A-1 Notes, the Class A-2 Notes, the
Class A-3 Notes and the Class A-4 Notes have been paid
in full, following the last day of any Collection
Period as of which the Pool Balance declines to 5% or
less of the Original Pool Balance, the
Certificateholders will receive an amount in respect of
the Certificates equal to the Certificate Balance
together with accrued interest at the Certificate Rate
and the Certificates will be retired. Any outstanding
Class A-5 Notes will be redeemed simultaneously with
the Certificates. See 'Description of the
Certificates--Optional Prepayment' herein.
RESERVE ACCOUNT......... A reserve account (the 'RESERVE ACCOUNT') will be
pledged by the Trust to the Indenture Trustee as
collateral for the Notes. The Reserve Account will be
funded with an initial deposit by the Seller of cash or
Permitted Investments having an aggregate value of
$ ( % of the Original Pool Balance)
(the 'RESERVE ACCOUNT INITIAL DEPOSIT'). In addition,
on each Distribution Date, any amounts on deposit in
the Collection Account with respect to the preceding
Collection Period after payments to the Servicer and
the Administrator and deposits to the Note Distribution
Account and Certificate Distribution Account have been
made will be deposited into the Reserve Account. On
each Distribution Date, any amounts on deposit in the
Reserve Account in excess of the Specified Reserve
Account Balance will be distributed to the Seller.
On or prior to each Deposit Date, the Indenture Trustee
will withdraw funds from the Reserve Account, to the
extent of the funds therein, to the extent (x) the sum
of the amounts required to be distributed to
Noteholders, Certificateholders, the Servicer and the
Administrator on the related Distribution Date exceeds
(y) the Total Distribution Amount for such Distribution
Date. If the amount in the Reserve Account is reduced
to zero and, in the case of the Noteholders, to the
extent the subordination of amounts distributable to
Certificateholders is
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insufficient, Noteholders and Certificateholders will
bear the credit and other risks associated with
ownership of the Receivables, including the risk that
the Trust may not have a perfected security interest in
the Financed Vehicles. See 'Description of the Transfer
and Servicing Agreements--Subordination of
Certificateholders; The Reserve Account' herein and
'Certain Legal Aspects of the Receivables' in the
Prospectus.
SPECIFIED RESERVE
ACCOUNT BALANCE....... On any Distribution Date, the specified reserve account
balance (the 'SPECIFIED RESERVE ACCOUNT BALANCE') will
equal % ( % under certain circumstances
described herein) of the Pool Balance as of the related
Settlement Date, but in any event not less than the
lesser of (i) $ ( % of the Original Pool
Balance) and (ii) the sum of (A) such Pool Balance and
(B) an amount sufficient to pay interest on each class
of Notes and the Certificates through its related Note
Final Scheduled Distribution Date or the Certificate
Final Scheduled Distribution Date, in each case, at a
rate equal to the sum of the related Interest Rate or
Certificate Rate plus the Servicing Fee Rate. The
Specified Reserve Account Balance with respect to any
Distribution Date may be reduced to a lesser amount as
determined by the Seller, provided that such reduction
does not adversely affect the rating of any class of
Notes or the Certificates by a Rating Agency.
COLLECTION ACCOUNT;
PRIORITY OF
PAYMENTS.............. The Servicer will be required to cause all collections
and other amounts constituting the Total Distribution
Amount (as defined below) to be deposited into one or
more accounts in the name of the Indenture Trustee
(collectively, the 'COLLECTION ACCOUNT') on each
Deposit Date, net of any amounts due the Seller and the
Servicer to the extent described in 'Description of the
Transfer and Servicing Agreement--Net Deposits' in the
Prospectus, except upon the occurrence of certain
conditions described in 'Description of the Transfer
and Servicing Agreement--Collections' in the
Prospectus. Pursuant to the Sale and Servicing
Agreement, the Servicer will have the revocable power
to instruct the Indenture Trustee or the Paying Agent
to withdraw funds on deposit in the Collection Account
and to apply such funds on each Distribution Date to
the following (in the priority indicated): (i) the
Servicing Fee, together with any unpaid Servicing Fees
from prior Distribution Dates (if not deducted from the
Servicer's remittance as described herein), (ii) the
Administration Fee, together with any unpaid
Administration Fees from prior Distribution Dates,
(iii) the Noteholders' Interest Distributable Amount
into the Note Distribution Account, (iv) the
Certificateholder's Interest Distributable Amount into
the Certificate Distribution Account (except as
described below), (v) the Noteholders' Principal
Distributable Amount into the Note Distribution Account
and (vi) the Certificateholders' Principal
Distributable Amount into the Certificate Distribution
Account.
Notwithstanding the foregoing, if an Event of Default
has occurred and the maturity of the Notes has been
accelerated, the Certificateholders will not be
entitled to receive any distributions in respect of the
Certificates until the Notes have been paid in full.
[PAID-AHEAD ACCOUNT..... Early payments by or on behalf of Obligors on Actuarial
Receivables which do not constitute scheduled payments,
full prepayments or certain partial prepayments that
result in a reduction of an Obligor's periodic payment
below the scheduled payment as of the Cutoff Date will
be deposited into the Paid-Ahead Account until such
time as the paid-ahead payment falls due. See
'Description of the Transfer and Servicing
Agreements--Paid-Ahead Actuarial Receivables' herein.]
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SERVICING FEE........... The Servicer shall receive a Servicing Fee for each
Collection Period, payable on each Distribution Date,
in an amount equal to the sum of (i) the product of
one-twelfth of the Servicing Fee Rate and the Pool
Balance as of the close of business on the last day of
the second Collection Period preceding the Collection
Period in which such Distribution Date occurs (the
'SETTLEMENT DATE') and (ii) any Late Fees paid by the
Obligors during the related Collection Period. A
'COLLECTION PERIOD' with respect to a Distribution Date
will be the calendar month preceding the calendar month
in which such Distribution Date occurs. In addition,
the Servicing Fee will include Investment Earnings on
amounts on deposit in the Collection Account [and the
Paid-Ahead Account]. See 'Description of the Transfer
and Servicing Agreements--Servicing Compensation and
Payment of Expenses' herein and 'Description of the
Transfer and Servicing Agreements--Servicing
Compensation and Payment of Expenses' and '--Net
Deposits' in the Prospectus.
ADMINISTRATION
AGREEMENT............. The Chase Manhattan Bank, in its capacity as
administrator (the 'ADMINISTRATOR'), will enter into an
agreement (the 'ADMINISTRATION AGREEMENT') with the
Trust and the Indenture Trustee. As compensation for
the performance of the Administrator's obligations
under the Administration Agreement, the Administrator
will be entitled to a monthly administration fee in an
amount equal to $ (the 'ADMINISTRATION FEE'). Chase
USA has agreed to perform certain of the duties of the
Administrator set forth in the Administration Agreement
and to reimburse and indemnify the Administrator for
all expenses or liabilities the Administrator may incur
as a result of its entering into the Administration
Agreement. See 'Description of the Transfer and
Servicing Agreements--Administration Agreement' herein.
TAX STATUS.............. Upon issuance of the Securities, Simpson Thacher &
Bartlett, special counsel to the Seller, will deliver
its opinion generally to the effect that under current
law 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
for United States federal income tax purposes. Each
Noteholder, by the acceptance of a Note, will agree to
treat the Notes as indebtedness, and each
Certificateholder, by the acceptance of a Certificate,
will agree to treat the Trust as a partnership in which
the Certificateholders are partners for federal, state
and local income tax purposes. Alternative
characterizations of the Trust and the Certificates are
possible, but would not result in materially adverse
tax consequences to Certificateholders. See 'Certain
Federal Income Tax Consequences' and 'Certain State Tax
Consequences' herein.
[LEGAL INVESTMENT....... The Class A-1 Notes will be eligible securities for
purchase by money market funds under paragraph (a)(9)
of Rule 2a-7 under the Investment Company Act of 1940,
as amended.]
ERISA CONSIDERATIONS.... Subject to the considerations described in 'ERISA
Considerations' herein and in the Prospectus, the Notes
are eligible for purchase with Plan Assets of any Plan.
A fiduciary or other person contemplating purchasing
the Notes on behalf of or with Plan Assets of any Plan
should carefully review with its legal advisors whether
the purchase or holding of the Notes could give rise to
a transaction prohibited or not otherwise permissible
under ERISA or Section 4975 of the Code.
The Certificates may not be acquired by, on behalf of
or with Plan Assets. See 'ERISA Considerations' herein
and in the Prospectus. By its acceptance of a
Certificate, each Certificateholder will be deemed to
have represented and warranted that it is not subject
to the foregoing limitations. The restrictions
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contained in the foregoing representation and warranty
shall not apply to the acquisition or holding of
Certificates with assets of the general account of an
insurance company to the extent that the acquisition or
holding, respectively, of such Certificates (i) is and
will be permissible under Section 401(c) of ERISA and
final regulations thereunder or another exemption under
ERISA and (ii) does not and will not result in the
contemplated operations of the Trust being treated as
non-exempt prohibited transactions. Persons
contemplating acquiring the Certificates should consult
their counsel to determine whether they are purchasing
on behalf of, or with Plan Assets of, any Plan. See
'ERISA Considerations' herein for additional
information, including special considerations for
purchasers using assets of an insurance company general
account.
RATINGS OF THE NOTES.... It is a condition to the issuance of the Securities
that the Class A-1 Notes be rated in the highest
short-term rating category and that the Class A-2,
Class A-3, Class A-4 Notes and Class A-5 Notes be rated
in the highest long-term rating category, in each case
by at least two nationally recognized statistical
rating organizations (each, a 'RATING AGENCY'). There
can be no assurance that any of these ratings will not
be lowered or withdrawn entirely if, in the sole
judgment of the related Rating Agency, circumstances in
the future so warrant. See 'Risk Factors--Ratings of
the Securities' herein.
RATINGS OF THE
CERTIFICATES ......... It is a condition to the issuance of the Securities
that the Certificates be rated at least in the ' '
category, or its equivalent, by at least two Rating
Agencies. There can be no assurance that any of these
ratings will not be lowered or withdrawn if, in the
sole judgment of the related Rating Agency,
circumstances in the future so warrant. See 'Risk
Factors--Ratings of the Securities' herein.
[LISTING................ Application will be made to list the Notes on the
Luxembourg Stock Exchange.]
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RISK FACTORS
Investors should consider, among other things, the matters discussed under
'Risk Factors' in the Prospectus and the following risk factors in connection
with purchases of the Securities.
LIMITED LIQUIDITY
There is currently no secondary market for the Securities offered hereby.
The Underwriters currently intend to make a market in the Securities offered
hereby, but none of them are under any obligation to do so. There can be no
assurance that a secondary market will develop or, if a secondary market does
develop, that it will provide the Securityholders with liquidity of investment
or that it will continue for the life of the Securities offered hereby.
TRUST'S RELATIONSHIP TO THE SELLER AND THE SERVICER
Neither the Seller nor the Servicer is generally obligated to make any
payments in respect of the Securities or the Receivables. In addition, if the
Bank were to cease acting as Servicer, delays in processing payments on the
Receivables and information in respect thereof could occur and result in delays
in payments to the Securityholders. See 'Description of the Transfer and
Servicing Agreements--Sale and Assignment of Receivables' in the Prospectus.
SUBORDINATION; LIMITED ASSETS
Distributions of principal on the Certificates will be subordinated to
payments of interest and principal due on the Notes. The Certificateholders will
not receive any distributions of interest with respect to an Interest Accrual
Period until the full amount of interest on the Notes due with respect to such
Interest Accrual Period has been deposited in the Note Distribution Account, and
under certain circumstances described herein, the Certificateholders will not
receive any distributions of interest with respect to an Interest Accrual Period
until the Notes are paid in full. The Certificateholders will not receive any
distributions of principal until the Distribution Date on which the Notes are
paid in full. See 'Description of the Transfer and Servicing Agreements--
Distributions' herein.
The Trust will not have, nor is it permitted or expected to have, any
significant assets or sources of funds other than the Receivables and the
amounts on deposit in the Reserve Account. Holders of the Notes and the
Certificates must rely for repayment upon payments on the Receivables and, if
and to the extent available on each Distribution Date to cover shortfalls in
distributions of interest and principal on the Notes and the Certificates,
amounts on deposit in the Reserve Account. However, funds deposited in the
Reserve Account are limited in amount, and the amount required to be maintained
on deposit therein will be reduced as the Pool Balance declines. If the amount
on deposit in the Reserve Account is exhausted, and, in the case of the
Noteholders, to the extent the subordination of amounts distributable to
Certificateholders is insufficient, the Trust will depend solely on current
distributions on the Receivables to make payments on the Notes and the
Certificates. The Securities will not be insured or guaranteed by the Bank, the
Servicer, the Owner Trustee, the Indenture Trustee or any affiliate thereof.
RATINGS OF THE SECURITIES
It is a condition to the issuance of the Securities that the Class A-1
Notes be rated in the highest short-term rating category and that the Class A-2,
Class A-3, Class A-4 and Class A-5 Notes be rated in the highest long-term
rating category, and that the Certificates be rated at least in the ' '
category, or its equivalent, in each case by at least two Rating Agencies. A
rating is not a recommendation to purchase, hold or sell Securities, inasmuch as
such rating does not comment as to market price or suitability for a particular
investor. The ratings of the Securities address the likelihood of the timely
payment of interest on and ultimate payment of principal of the Securities
pursuant to their terms. There can be no assurance that a rating will remain for
any given period of time or that a rating will not be lowered or withdrawn
entirely if, in the sole judgement of the related Rating Agency, circumstances
in the future so warrant.
S-9
<PAGE>
THE TRUST
GENERAL
The Issuer, Chase Manhattan Bank Auto Owner Trust 199 - , is a business
trust formed under the laws of the State of Delaware pursuant to the Trust
Agreement for the transaction described in this Prospectus Supplement. The
activities of the Trust are limited by the terms of the Trust Agreement to (i)
acquiring, holding and managing the Receivables and the other assets of the
Trust and proceeds therefor, (ii) issuing the Notes and the Certificates to
finance such assets, (iii) making payments on the Notes and the Certificates
issued by it, and (iv) engaging in other activities that are necessary, suitable
or convenient to accomplish the foregoing or are incidental thereto or connected
therewith. The Trust will not acquire any contracts or assets other than the
Trust property described below and will not have any need for additional capital
resources. As the Trust does not have any operating history and will not engage
in any activity other than acquiring and holding the Receivables, issuing the
Notes and Certificates and making distributions thereon, there has not been
included any historical or pro forma financial statements or ratio of earnings
to fixed charges with respect to the Trust. Inasmuch as the Trust has no
operating history, it is not possible to predict the operating performance of
the Trust while the Notes and Certificates are outstanding. While management of
the Seller believes that the loss and delinquency experience contained herein
for recent periods are representative of past performance of Motor Vehicle Loans
in the Chase Auto Finance Portfolio, there is no assurance that such performance
is indicative of the future performance of the Receivables, since future
performance is dependent, among other things, on general economic conditions and
economic conditions in the geographical areas in which the Obligors reside
including, for example, unemployment rates.
The Certificate Balance represents the equity in the Trust. The Notes and
the Certificates will be transferred to the Seller by the Trust in exchange for
the Receivables pursuant to the Sale and Servicing Agreement.
The Trust property will include a pool (the 'RECEIVABLES POOL') comprised
of the Receivables and all monies received thereunder on and after the Cutoff
Date. The Trust property will also include: (i) such amounts as from time to
time may be held in one or more Trust Accounts established and maintained
pursuant to the Sale and Servicing Agreement, as described herein; (ii) security
interests in the Financed Vehicles; (iii) proceeds from the exercise of the
Seller's recourse rights against Dealers (as described in the Prospectus under
'The Receivables Pools--Origination and Servicing of Motor Vehicle Loans'); (iv)
proceeds from claims on theft and physical damage, credit life and credit
disability insurance policies covering the Financed Vehicles or the Obligors, as
the case may be, to the extent that such insurance policies relate to the
Receivables; (v) rights with respect to any repossessed Financed Vehicles and
(vi) any and all proceeds of the foregoing. The Sale and Servicing Agreement
sets forth criteria that must be satisfied by each Receivable. See 'Description
of the Transfer and Servicing Agreements--Sale and Assignment of Receivables' in
the Prospectus. Each Receivable will be identified in a schedule appearing as an
exhibit to the Sale and Servicing Agreement.
If the protection provided to the investment of the Securityholders by the
Reserve Account is insufficient, and, in the case of the Noteholders, to the
extent the subordination of amounts distributable to Certificateholders is
insufficient, the Trust will look only to the Obligors on the Receivables and
the proceeds from the repossession and sale of Financed Vehicles that secure
Defaulted Receivables. In such event, certain factors, such as the Trust's not
having a first priority perfected security interest in some of the Financed
Vehicles, may affect the Trust's ability to realize on the collateral securing
the Receivables, and thus may reduce the proceeds to be distributed to
Securityholders with respect to the Securities. See 'Description of the Transfer
and Servicing Agreements--Distributions' and '--Subordination of
Certificateholders; Reserve Account' herein and 'Certain Legal Aspects of the
Receivables' in the Prospectus.
The Trust's principal offices are in Delaware at the address listed below
under '--The Owner Trustee.'
S-10
<PAGE>
CAPITALIZATION OF THE TRUST
The following table illustrates the capitalization of the Trust as of the
Cutoff Date, as if the issuance and sale of the Notes and the Certificates have
taken place on such date:
<TABLE>
<S> <C>
Class A-1 Notes........................................ $
Class A-2 Notes........................................
Class A-3 Notes........................................
Class A-4 Notes........................................
Class A-5 Notes........................................
Certificates...........................................
---------------
Total................................................ $
---------------
---------------
</TABLE>
THE OWNER TRUSTEE
is the Owner Trustee under the Trust Agreement.
is a and its principal
offices are located at
. The Seller and its affiliates may maintain normal
commercial banking relations with the Owner Trustee and its affiliates.
THE RECEIVABLES POOL
The Receivables represent Motor Vehicle Loans from the portfolio of the
Seller that, in addition to satisfying the criteria set forth in the Prospectus
under 'The Receivables Pools--General':
(a) have a remaining maturity, as of the Cutoff Date, of at least
months and not more than months;
(b) are secured by new Financed Vehicles and had an original maturity
of at least months and not more than months, or by used Financed
Vehicles and had an original maturity of at least months and not more
than months;
(c) are fully-amortizing fixed rate simple interest [or actuarial]
contracts that provide for level scheduled monthly payments over their
respective remaining terms, have an annual contract rate of interest (a
'CONTRACT RATE') of at least % and not more than %;
(d) have remaining principal balances, as of the Cutoff Date, of at
least $ and not greater than $ ;
(e) have no payment that is delinquent for more than 30 days past due
as of the Cutoff Date; and
(f) are not Motor Vehicle Loans (i) whose related Obligor resides in
the State of Alabama (in the case of Direct Receivables) or (ii) originated
by or through a Dealer located in the State of Alabama (in the case of
Receivables which are not Direct Receivables) or Motor Vehicle Loans the
subject of a previous securitization.
The Receivables were selected from the Motor Vehicle Loans in the portfolio
of the Seller that met the above criteria. For administrative reasons, the
Seller selected from the Motor Vehicle Loans in its portfolio all otherwise
eligible Motor Vehicle Loans originated since , 199 , which were
segregated and held for sale by the Seller. The Seller believes that such
selection procedures are not materially adverse to Securityholders.
Approximately % of the Original Pool Balance were secured by new Financed
Vehicles, and approximately % of the Original Pool Balance were secured by
used Financed Vehicles. [All of the Receivables are Simple Interest
Receivables.] [ % of the Original Pool Balance were Simple Interest
Receivables and % of the Original Pool Balance were Actuarial Receivables.]
An insignificant number of the Receivables provide for recourse to the Dealer in
the event of default by the Obligor.
Approximately % of the Original Pool Balance were made directly by the
Originating Bank to Obligors without involvement of Dealers (collectively, the
'DIRECT RECEIVABLES') using the Chase Auto Finance underwriting criteria and
have been serviced consistent with Chase Auto Finance's servicing policies and
practices. The Direct Receivables originated by Chase, as Originating Bank, will
be transferred to the Seller on or prior to the Closing Date.
S-11
<PAGE>
The Seller may not substitute other Motor Vehicle Loans from its portfolio,
or any other motor vehicle receivables, for the Receivables at any time during
the term of the Sale and Servicing Agreement. See 'The Receivables
Pools--General' and 'Weighted Average Life of the Securities' in the Prospectus
for a description of how prepayments made under Simple Interest Receivables [and
Actuarial Receivables] are allocated.
The composition of the Receivables, distribution by Contract Rate of the
Receivables and the geographic distribution of the Receivables, in each case as
of the Cutoff Date, are set forth in the following tables.
COMPOSITION OF THE RECEIVABLES
<TABLE>
<CAPTION>
NEW FINANCED USED FINANCED
VEHICLES VEHICLES TOTAL
----------------- ----------------- -----------------
<S> <C> <C> <C>
Aggregate Principal Balance................ $ $ $
Number of Receivables......................
Average Principal Balance.................. $ $ $
Average Original Balance................... $ $ $
Weighted Average Contract Rate............. % % %
Contract Rate (Range)...................... % to % % to % % to %
Weighted Average Original Term............. months months months
Original Term (Range)...................... to months to months to months
Weighted Average Remaining Term............ months months months
Remaining Term (Range)..................... to months to months to months
</TABLE>
DISTRIBUTION BY CONTRACT RATE OF THE RECEIVABLES
<TABLE>
<CAPTION>
PERCENT OF
NUMBER OF ORIGINAL
CONTRACT RATE RANGE RECEIVABLES PRINCIPAL BALANCE POOL BALANCE
- - - -------------------------------------------------------------- ----------- ----------------- ----------------
<S> <C> <C> <C>
% to below %.......................................... $ %
% to below %.......................................... %
% to below %.......................................... %
% to below %.......................................... %
% to below %.......................................... %
% to below %.......................................... %
% to below %.......................................... %
% to below %.......................................... %
% to below %.......................................... %
% to below %.......................................... %
% to below %.......................................... %
% to below %.......................................... %
% to below %.......................................... %
% to below %.......................................... %
% to below %.......................................... %
% to below %.......................................... %
% to below %.......................................... %
% to below %.......................................... %
% to below %.......................................... %
% to below %.......................................... %
% to below %.......................................... %
% to below %.......................................... %
% to below %.......................................... %
% to below %.......................................... %
% to below %.......................................... %
% to below %.......................................... %
----------- ----------------- -------
Total(1)...................................................... $ 100.00%
----------- ----------------- -------
----------- ----------------- -------
</TABLE>
- - - ------------------------
(1) Dollar amounts and percentages may not add to the total or to 100.00%,
respectively, due to rounding.
S-12
<PAGE>
GEOGRAPHIC DISTRIBUTION OF THE RECEIVABLES(1)
<TABLE>
<CAPTION>
PERCENT OF
NUMBER OF ORIGINAL
STATE RECEIVABLES PRINCIPAL BALANCE POOL BALANCE
- - - ------------------------------------------------------------------- ----------- ----------------- ------------
<S> <C> <C> <C>
Arizona............................................................ $ %
Arkansas...........................................................
California.........................................................
Colorado...........................................................
Connecticut........................................................
Delaware...........................................................
District of Columbia...............................................
Florida............................................................
Georgia............................................................
Hawaii.............................................................
Idaho..............................................................
Illinois...........................................................
Indiana............................................................
Iowa...............................................................
Kansas.............................................................
Kentucky...........................................................
Louisiana..........................................................
Maine..............................................................
Maryland...........................................................
Massachusetts......................................................
Michigan...........................................................
Minnesota..........................................................
Mississippi........................................................
Missouri...........................................................
Montana............................................................
Nebraska...........................................................
Nevada.............................................................
New Hampshire......................................................
New Jersey.........................................................
New Mexico.........................................................
New York...........................................................
North Carolina.....................................................
North Dakota.......................................................
Ohio...............................................................
Oklahoma...........................................................
Oregon.............................................................
Pennsylvania.......................................................
Rhode Island.......................................................
South Carolina.....................................................
South Dakota.......................................................
Tennessee..........................................................
Texas..............................................................
Utah...............................................................
Vermont............................................................
Virginia...........................................................
Washington.........................................................
West Virginia......................................................
Wisconsin..........................................................
Wyoming............................................................
----------- ----------------- ------------
Total(2)........................................................... $ %
----------- ----------------- ------------
----------- ----------------- ------------
</TABLE>
(Footnotes on next page)
S-13
<PAGE>
(Footnotes from previous page)
- - - ------------------
(1) Based on location of the related Obligor (in the case of Direct Receivables)
or the Dealer from which the related Motor Vehicle Loan was acquired or
through which it was made (in the case of Receivables which are not Direct
Receivables).
(2) Dollar amounts and percentages may not add to the total or to 100.00%,
respectively, due to rounding.
DELINQUENCY AND LOAN LOSS INFORMATION
The following tables set forth information with respect to delinquencies,
loan losses and recoveries for the Chase Auto Finance Portfolio as of the dates
indicated and for each of the one year periods ended December 31, 199 , 199 ,
199 , 199 and 199 . The portions of the Chase Auto Finance Portfolio that
provide for payments based upon variable rate simple interest [and the actuarial
method] are included in the following tables, but Motor Vehicle Loans of such
type are not included in the Trust. Chase Auto Finance does not maintain
separate records that distinguish among the delinquency and loan loss experience
for Motor Vehicle Loans that provide for payments based upon fixed rate simple
interest (such as the Receivables), [and] variable rate simple interest [and the
actuarial method]. The Seller believes, however, that the delinquency and loan
loss experience with respect to the fixed rate simple interest [and actuarial]
Motor Vehicle Loans included in the Trust is not materially different from the
performance of the Chase Auto Finance Portfolio set forth below.
Approximately % of the Original Pool Balance were Direct Receivables.
The delinquency and loan loss experience for Direct Receivables are not included
in the performance of the Chase Auto Finance Portfolio set forth below. The
Seller believes that the delinquency and loan loss experience for Direct
Receivables has not been materially different from the performance of the Chase
Auto Finance Portfolio set forth below.
See 'The Receivables Pools--General' and '--Delinquency and Loan Loss
Information' in the Prospectus for a description of the composition of the Chase
Auto Finance Portfolio.
The data presented in the following tables are for illustrative purposes
only. Delinquency and loan loss experience may be influenced by a variety of
economic, social and other factors. No assurance can be given that the
delinquency and loan loss information of the Bank, or of the Trust with respect
to the Receivables, in the future will be similar to that set forth below.
S-14
<PAGE>
DELINQUENCY EXPERIENCE(1)(2)
<TABLE>
<CAPTION>
AS OF DECEMBER 31,
----------------------------------------------------------------------------------------------
199 199 199 199
---------------------- ---------------------- ---------------------- ----------
NUMBER NUMBER NUMBER
DOLLARS OF DOLLARS OF DOLLARS OF DOLLARS
(000'S) LOANS (000'S) LOANS (000'S) LOANS (000'S)
---------- ------- ---------- ------- ---------- ------- ----------
<S> <C> <C> <C> <C> <C> <C> <C>
Outstanding Principal
Amount.................... $ $ $ $
---------- ------- ---------- ------- ---------- ------- ----------
---------- ------- ---------- ------- ---------- ------- ----------
Delinquencies(3)(4)
30-59 Days................ $ $ $ $
60-89 Days................
90 Days or More...........
---------- ------- ---------- ------- ---------- ------- ----------
---------- ------- ---------- ------- ---------- ------- ----------
TOTAL Delinquencies......... $ $ $ $
Repossession Inventory(5)...
---------- ------- ---------- ------- ---------- ------- ----------
---------- ------- ---------- ------- ---------- ------- ----------
TOTAL Delinquencies &
Repossession Inventory.... $ $ $ $
---------- ------- ---------- ------- ---------- ------- ----------
---------- ------- ---------- ------- ---------- ------- ----------
Delinquencies(3)(4)(6)
30-59 Days................ % % % %
60-89 Days................ % % % %
90 Days or More........... % % % %
---------- ---------- ---------- ----------
TOTAL Delinquencies(6)(7)... % % % %
Repossession Inventory(6)... % % % %
---------- ---------- ---------- ----------
TOTAL Delinquencies &
Repossession
Inventory(6)(7)........... % % % %
---------- ---------- ---------- ----------
---------- ---------- ---------- ----------
<CAPTION>
199
----------------------
NUMBER NUMBER
OF DOLLARS OF
LOANS (000'S) LOANS
------- ---------- -------
<S> <C> <C> <C>
Outstanding Principal
Amount.................... $
------- ---------- -------
------- ---------- -------
Delinquencies(3)(4)
30-59 Days................ $
60-89 Days................
90 Days or More...........
------- ---------- -------
------- ---------- -------
TOTAL Delinquencies......... $
Repossession Inventory(5)...
------- ---------- -------
------- ---------- -------
TOTAL Delinquencies &
Repossession Inventory.... $
------- ---------- -------
------- ---------- -------
Delinquencies(3)(4)(6)
30-59 Days................ %
60-89 Days................ %
90 Days or More........... %
----------
TOTAL Delinquencies(6)(7)... %
Repossession Inventory(6)... %
----------
TOTAL Delinquencies &
Repossession
Inventory(6)(7)........... %
----------
----------
</TABLE>
- - - ------------------
(1) The delinquency experience presented does not include experience with
respect to Direct Receivables.
(2) As of December 31, 199 , approximately % of the aggregate principal
balance of Motor Vehicle Loans in the portfolio presented were Chase
Maryland Loans.
(3) Delinquencies include principal amounts only.
(4) The period of delinquency is based on the number of days payments are
contractually past due.
(5) As of December 31, 1994 and earlier, amounts shown in repossession inventory
represent loans which have been written down to the fair market value of the
collateral, but where the related financed vehicles have not yet been sold.
As of December 31, 1995 and later, amounts shown in repossession inventory
represent the total outstanding principal balance of the loans at such
times.
(6) As a percent of outstanding principal in dollars.
(7) Percentages representing TOTAL Delinquencies and TOTAL Delinquencies &
Repossession Inventory may not add to the components thereof due to
rounding.
S-15
<PAGE>
LOAN LOSS EXPERIENCE(1)(2)
(DOLLARS IN 000'S)
<TABLE>
<CAPTION>
YEAR ENDED
----------------------------------------------------------------------------
DECEMBER 31, DECEMBER 31, DECEMBER 31, DECEMBER 31, DECEMBER 31,
199 199 199 199 199
------------ ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C>
Number of Loans(3)............
Period End Outstanding
Principal Amount............ $ $ $ $ $
Average Outstanding Principal
Amount(4)................... $ $ $ $ $
Number of Repossessions.......
Number of Gross Charge-Offs...
Gross Charge-Offs(5).......... $ $ $ $ $
Gross Charge-Offs as a % of
Period End Outstanding
Principal Amount(5)......... % % % % %
Gross Charge-Offs as a % of
Average Outstanding
Principal Amount(5)......... % % % % %
Recoveries(6)................. $ $ $ $ $
Net Charge-Offs(7)............ $ $ $ $ $
Net Charge-Offs as a % of
Period End Outstanding
Principal Amount(7)......... % % % % %
Net Charge-Offs as a % of
Average Outstanding
Principal Amount(7)......... % % % % %
</TABLE>
- - - ------------------
(1) The loan loss experience presented does not include experience with respect
to Direct Receivables.
(2) As of December, 199 , approximately % of the aggregate principal balance
of Motor Vehicle Loans in the portfolio presented were Chase Maryland Loans.
(3) Number of loans as of period end.
(4) The average for 1992 was computed by taking the simple average of month end
outstanding principal amounts for the year, and the average for each other
period presented was computed by taking a simple average of monthly average
outstanding principal amounts for such period.
(5) Amount charged off is remaining principal balance less proceeds from sale of
repossessed vehicles.
(6) Recoveries generally include amounts received with respect to loans
previously charged-off, except for proceeds realized in connection with the
sale of the repossessed vehicles.
(7) Net Charge-Offs mean gross charge-offs minus recoveries of loans previously
charged-off. Net Charge-Offs may not equal the difference of the components
thereof due to rounding.
S-16
<PAGE>
CHASE USA
Information regarding the Seller and the Servicer is set forth under 'Chase
USA' in the Prospectus. At 199 , Chase USA's total assets were
approximately $ billion, total liabilities were approximately $ billion
and total stockholders' equity was approximately $ billion.
USE OF PROCEEDS
After the deposit of the Reserve Account Initial Deposit and the deduction
of estimated expenses, the net proceeds to be received by the Seller from the
sale of Securities will be added to its general funds.
WEIGHTED AVERAGE LIFE OF THE SECURITIES
Information regarding certain maturity and prepayment considerations with
respect to the Securities is set forth under 'Weighted Average Life of
Securities' in the Prospectus. No principal payments will be made on the Class
A-2 Notes until all Class A-1 Notes have been paid in full, no principal
payments will be made on the Class A-3 Notes until all Class A-2 Notes have been
paid in full, no principal payments will be made on the Class A-4 Notes until
all Class A-3 Notes have been paid in full and no principal payments will be
made on the Class A-5 Notes until all Class A-4 Notes have been paid in full. In
addition, no principal payments on the Certificates will be made until the Notes
have been paid in full. See 'Description of the Notes--Payments of Principal'
and 'Description of the Certificates--Distributions of Principal Payments'
herein. As the rate of payment of principal of each class of Notes and the
Certificates depends primarily on the rate of payment (including prepayments) of
the principal balance of the Receivables, final payment of any class of the
Notes and the final distribution in respect of the Certificates could occur
significantly earlier than their respective Note Final Scheduled Distribution
Dates or the Certificate Final Scheduled Distribution Date. It is expected that
final payment of the Notes and the final distribution in respect of the
Certificates will occur on or prior to the related Note Final Scheduled
Distribution Date or the Certificate Final Scheduled Distribution Date. However,
if sufficient funds are not available to pay the Notes or the Certificates in
full on or prior to the related Note Final Scheduled Distribution Date or the
Certificate Final Scheduled Distribution Date, final payment of the Notes and
the final distribution in respect of the Certificates could occur later than
such date. Securityholders will bear the risk of being able to reinvest
principal payments of the Securities at yields at least equal to the Interest
Rate or Certificate Rate, as applicable.
If the Reserve Account is exhausted and losses on the Receivables occur,
the amount of interest distributed to the Securityholders may be less than
described above. If an Event of Default has occurred and the maturity of the
Notes has been accelerated, the Certificateholders will not be entitled to
receive any distributions in respect of their Certificates until the Notes have
been paid in full.
Subject to the conditions set forth herein under the heading 'Description
of the Transfer and Servicing Agreements--Servicing Procedures,' the Servicer
may reschedule the Due Date of any scheduled payment. Any such deferrals will
have the effect of increasing the weighted average life of the Notes and
Certificates. However, the Servicer will not be permitted to grant any such
deferral or extension if, as a result, the final scheduled payment on a
Receivable would fall after the Final Scheduled Maturity Date, unless the
Servicer purchases such Receivable.
Chase Auto Finance maintains limited records of the historical prepayment
experience of certain portions of the Chase Auto Finance Portfolio. The Seller
believes that such records are not adequate to provide meaningful information
with respect to the Receivables. In any event, no assurance can be given that
prepayments on the Receivables would conform to any historical experience, and
no prediction can be made as to the actual prepayment experience to be expected
with respect to the Receivables.
Prepayments on motor vehicle receivables can be measured relative to a
prepayment standard or model. The model used in this Prospectus Supplement, the
Absolute Prepayment Model ('ABS'), represents an assumed rate of prepayment each
month relative to the original number of receivables in a pool of receivables.
ABS further assumes that all the receivables are the same size and amortize at
the same rate and that each receivable in each month of its life will either be
paid as scheduled or be prepaid in full. For example, in a pool of receivables
originally containing 10,000 receivables, a 1% ABS rate means that 100
receivables prepay each month. ABS
S-17
<PAGE>
does not purport to be an historical description of prepayment experience or a
prediction of the anticipated rate of prepayment of any pool of receivables,
including the Receivables.
The tables captioned 'Percent of Initial Note Principal Balance at Various
ABS Percentages' and 'Percent of Initial Certificate Balance at Various ABS
Percentages' (each an 'ABS TABLE') have been prepared on the basis of the
characteristics of the Receivables. Each ABS Table assumes that (a) the
Receivables prepay in full at the specified constant percentage of ABS monthly,
with no defaults, losses or repurchases, (b) each scheduled monthly payment on
the Receivables is made on the last day of each month and each month has 30
days, (c) payments on the Notes and distributions on the Certificates are made
on each Distribution Date (and each such date is assumed to be the 15th day of
each applicable month), (d) the balance in the Reserve Account on each
Distribution Date is equal to the Specified Reserve Account Balance, and (e) the
Servicer does not exercise its option to purchase the Receivables. The
Receivables Pool has an assumed cutoff date of the Cutoff Date. The ABS Table
indicates the projected weighted average life of each class of Notes and the
Certificates and sets forth the percent of the initial principal amount of each
class of Notes and the percent of the initial Certificate Balance, as
applicable, that is projected to be outstanding after each of the Distribution
Dates shown at various constant ABS percentages.
The ABS Tables also assume that (i) the Receivables have been aggregated
into hypothetical pools with all of the Receivables within each such pool having
the following characteristics and that (ii) the level scheduled monthly payment
for each such pool (which is based on its principal balance, weighted average
Contract Rate, weighted average original term to maturity and weighted average
remaining term to maturity as of the Cutoff Date) will be such that each pool
will be fully amortized by the end of its remaining term to maturity.
<TABLE>
<CAPTION>
REMAINING WEIGHTED WEIGHTED
TERM TO WEIGHTED AVERAGE AVERAGE
MATURITY AVERAGE ORIGINAL TERM REMAINING TERM
RANGE AGGREGATE CONTRACT TO MATURITY TO MATURITY
POOL (IN MONTHS) PRINCIPAL BALANCE RATE (IN MONTHS) (IN MONTHS)
- - - ----- ----------- ----------------- --------- ------------- --------------
<S> <C> <C> <C> <C> <C>
1 $ %
2 %
3 %
4 %
5 %
-----------------
$
-----------------
-----------------
</TABLE>
The information included in the following tables represents forward-looking
statements and involves risks and uncertainties that could cause actual results
to differ materially from those in the forward-looking statements. The actual
characteristics and performance of the Receivables will differ from the
assumptions used in constructing each ABS Table. The assumptions used are
hypothetical and have been provided only to give a general sense of how the
principal cash flows might behave under varying prepayment scenarios. For
example, it is very unlikely that the Receivables will prepay at a constant
level of ABS until maturity or that all of the Receivables will prepay at the
same level of ABS. Moreover, the diverse terms of Receivables within each of the
five hypothetical pools could produce slower or faster principal distributions
than indicated in each ABS Table at the various constant percentages of ABS
specified, even if the original and remaining terms to maturity of the
Receivables are as assumed. Any difference between such assumptions and the
actual characteristics and performance of the Receivables, or actual prepayment
experience, will affect the percentages of initial balances outstanding over
time and the weighted average lives of each class of Notes and the Certificates.
S-18
<PAGE>
PERCENT OF INITIAL NOTE PRINCIPAL BALANCE AT VARIOUS ABS PERCENTAGES
<TABLE>
<CAPTION>
CLASS A-1 NOTES CLASS A-2 NOTES
-------------------------------- --------------------------------
ASSUMED ABS PERCENTAGE(2) ASSUMED ABS PERCENTAGE(2)
-------------------------------- --------------------------------
DISTRIBUTION DATES % % % % % % % %
- - - ---------------------------------------------- ----- ----- ----- ----- ----- ----- ----- -----
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Closing Date..................................
Weighted Average Life (years)(1)..............
</TABLE>
- - - ------------------
(1) The weighted average life of a Note is determined by (i) multiplying the
amount of each principal payment of such Note by the number of years from
the date of the issuance of such Note to the Distribution Date on which such
principal payment is made, (ii) adding the results and (iii) dividing the
sum by the initial principal balance of such Note.
(2) An asterisk '*' means a percent of initial Note principal balance of more
than zero and less than 0.5%.
THE ABS TABLES HAVE BEEN PREPARED BASED ON THE ASSUMPTIONS DESCRIBED ABOVE
(INCLUDING THE ASSUMPTIONS REGARDING THE CHARACTERISTICS AND PERFORMANCE OF THE
RECEIVABLES WHICH WILL DIFFER FROM THE ACTUAL CHARACTERISTICS AND PERFORMANCE
THEREOF) AND SHOULD BE READ IN CONJUNCTION THEREWITH.
S-19
<PAGE>
PERCENT OF INITIAL NOTE PRINCIPAL BALANCE AT VARIOUS ABS PERCENTAGES
<TABLE>
<CAPTION>
CLASS A-3 NOTES CLASS A-4 NOTES
-------------------------------- --------------------------------
ASSUMED ABS PERCENTAGE ASSUMED ABS PERCENTAGE
-------------------------------- --------------------------------
DISTRIBUTION DATES % % % % % % % %
- - - ---------------------------------------------- ----- ----- ----- ----- ----- ----- ----- -----
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Closing Date..................................
</TABLE>
- - - ------------------
(1) The weighted average life of a Note is determined by (i) multiplying the
amount of each principal payment of such Note by the number of years from
the date of the issuance of such Note to the Distribution Date on which such
principal payment is made, (ii) adding the results and (iii) dividing the
sum by the initial principal balance of such Note.
(2) An asterisk '*' means a percent of initial Note principal balance of more
than zero and less than 0.5%.
THE ABS TABLES HAVE BEEN PREPARED BASED ON THE ASSUMPTIONS DESCRIBED ABOVE
(INCLUDING THE ASSUMPTIONS REGARDING THE CHARACTERISTICS AND PERFORMANCE OF THE
RECEIVABLES WHICH WILL DIFFER FROM THE ACTUAL CHARACTERISTICS AND PERFORMANCE
THEREOF) AND SHOULD BE READ IN CONJUNCTION THEREWITH.
S-20
<PAGE>
PERCENT OF INITIAL NOTE PRINCIPAL BALANCE AT VARIOUS ABS PERCENTAGES (CONTINUED)
<TABLE>
<CAPTION>
CLASS A-3 NOTES CLASS A-4 NOTES
-------------------------------- --------------------------------
ASSUMED ABS PERCENTAGE(2) ASSUMED ABS PERCENTAGE(2)
-------------------------------- --------------------------------
DISTRIBUTION DATES % % % % % % % %
- - - ---------------------------------------------- ----- ----- ----- ----- ----- ----- ----- -----
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Weighted Average Life (years)(1)..............
</TABLE>
- - - ------------------
(1) The weighted average life of a Note is determined by (i) multiplying the
amount of each principal payment of such Note by the number of years from
the date of the issuance of such Note to the Distribution Date on which such
principal payment is made, (ii) adding the results and (iii) dividing the
sum by the initial principal balance of such Note.
(2) An asterisk '*' means a percent of initial Note principal balance of more
than zero and less than 0.5%.
THE ABS TABLES HAVE BEEN PREPARED BASED ON THE ASSUMPTIONS DESCRIBED ABOVE
(INCLUDING THE ASSUMPTIONS REGARDING THE CHARACTERISTICS AND PERFORMANCE OF THE
RECEIVABLES WHICH WILL DIFFER FROM THE ACTUAL CHARACTERISTICS AND PERFORMANCE
THEREOF) AND SHOULD BE READ IN CONJUNCTION THEREWITH.
S-21
<PAGE>
PERCENT OF INITIAL NOTE PRINCIPAL BALANCE AT VARIOUS ABS PERCENTAGES
<TABLE>
<CAPTION>
CLASS A-5 NOTES
--------------------------------
ASSUMED ABS PERCENTAGE(2)
--------------------------------
DISTRIBUTION DATES % % % %
- - - -------------------------------------------------------------------------------- ----- ----- ----- -----
<S> <C> <C> <C> <C>
Closing Date....................................................................
</TABLE>
- - - ------------------
(1) The weighted average life of a Note is determined by (i) multiplying the
amount of each principal payment of such Note by the number of years from
the date of the issuance of such Note to the Distribution Date on which such
principal payment is made, (ii) adding the results and (iii) dividing the
sum by the initial principal balance of such Note.
(2) An asterisk '*' means a percent of initial Note principal balance of more
than zero and less than 0.5%.
THE ABS TABLES HAVE BEEN PREPARED BASED ON THE ASSUMPTIONS DESCRIBED ABOVE
(INCLUDING THE ASSUMPTIONS REGARDING THE CHARACTERISTICS AND PERFORMANCE OF THE
RECEIVABLES WHICH WILL DIFFER FROM THE ACTUAL CHARACTERISTICS AND PERFORMANCE
THEREOF) AND SHOULD BE READ IN CONJUNCTION THEREWITH.
S-22
<PAGE>
PERCENT OF INITIAL NOTE PRINCIPAL BALANCE AT VARIOUS ABS PERCENTAGES (CONTINUED)
<TABLE>
<CAPTION>
CLASS A-5 NOTES
--------------------------------
ASSUMED ABS PERCENTAGE(2)
--------------------------------
DISTRIBUTION DATES % % % %
- - - -------------------------------------------------------------------------------- ----- ----- ----- -----
<S> <C> <C> <C> <C>
Weighted Average Life (years)(1)................................................
</TABLE>
- - - ------------------
(1) The weighted average life of a Note is determined by (i) multiplying the
amount of each principal payment of such Note by the number of years from
the date of the issuance of such Note to the Distribution Date on which such
principal payment is made, (ii) adding the results and (iii) dividing the
sum by the initial principal balance of such Note.
(2) An asterisk '*' means a percent of initial Note principal balance of more
than zero and less than 0.5%.
THE ABS TABLES HAVE BEEN PREPARED BASED ON THE ASSUMPTIONS DESCRIBED ABOVE
(INCLUDING THE ASSUMPTIONS REGARDING THE CHARACTERISTICS AND PERFORMANCE OF THE
RECEIVABLES WHICH WILL DIFFER FROM THE ACTUAL CHARACTERISTICS AND PERFORMANCE
THEREOF) AND SHOULD BE READ IN CONJUNCTION THEREWITH.
S-23
<PAGE>
PERCENT OF INITIAL CERTIFICATE BALANCE AT VARIOUS ABS PERCENTAGES
<TABLE>
<CAPTION>
CERTIFICATES
--------------------------------
ASSUMED ABS PERCENTAGE(2)
--------------------------------
DISTRIBUTION DATES % % % %
- - - -------------------------------------------------------------------------------- ----- ----- ----- -----
<S> <C> <C> <C> <C>
Closing Date....................................................................
</TABLE>
- - - ------------------
(1) The weighted average life of a Certificate is determined by (i) multiplying
the amount of each principal payment with respect to such Certificate by the
number of years from the date of the issuance of such Certificate to the
Distribution Date on which it is made, (ii) adding the results and (iii)
dividing the sum by the initial certificate balance of such Certificate.
(2) An asterisk '*' means a percent of initial Certificate principal balance of
more than zero and less than 0.5%.
THE ABS TABLES HAVE BEEN PREPARED BASED ON THE ASSUMPTIONS DESCRIBED ABOVE
(INCLUDING THE ASSUMPTIONS REGARDING THE CHARACTERISTICS AND PERFORMANCE OF THE
RECEIVABLES WHICH WILL DIFFER FROM THE ACTUAL CHARACTERISTICS AND PERFORMANCE
THEREOF) AND SHOULD BE READ IN CONJUNCTION THEREWITH.
S-24
<PAGE>
PERCENT OF INITIAL CERTIFICATE BALANCE AT VARIOUS ABS PERCENTAGES (CONTINUED)
<TABLE>
<CAPTION>
CERTIFICATES
--------------------------------
ASSUMED ABS PERCENTAGE(2)
--------------------------------
DISTRIBUTION DATES % % % %
- - - -------------------------------------------------------------------------------- ----- ----- ----- -----
<S> <C> <C> <C> <C>
Weighted Average Life (years)(1)................................................
</TABLE>
- - - ------------------
(1) The weighted average life of a Certificate is determined by (i) multiplying
the amount of each principal payment with respect to such Certificate by the
number of years from the date of the issuance of such Certificate to the
Distribution Date on which it is made, (ii) adding the results and (iii)
dividing the sum by the initial principal balance of such Certificate.
(2) An asterisk '*' means a percent of initial Certificate principal balance of
more than zero and less than 0.5%.
THE ABS TABLES HAVE BEEN PREPARED BASED ON THE ASSUMPTIONS DESCRIBED ABOVE
(INCLUDING THE ASSUMPTIONS REGARDING THE CHARACTERISTICS AND PERFORMANCE OF THE
RECEIVABLES WHICH WILL DIFFER FROM THE ACTUAL CHARACTERISTICS AND PERFORMANCE
THEREOF) AND SHOULD BE READ IN CONJUNCTION THEREWITH.
S-25
<PAGE>
DESCRIPTION OF THE NOTES
GENERAL
The Notes will be issued pursuant to the terms of the Indenture, a form of
which has been filed as an exhibit to the Registration Statement. A copy of the
Indenture will be filed with the Commission following the issuance of the
Securities. The following, as well as other pertinent information included
elsewhere in this Prospectus Supplement and in the Prospectus, summarizes the
material terms of the Notes and the Indenture. The summary does not purport to
be complete and is subject to, and is qualified in its entirety by reference to,
all the provisions of the Notes and the Indenture. The following summary
supplements the description of the general terms and provisions of the Notes of
any given series and the related Indenture set forth in the Prospectus, to which
description reference is hereby made.
, a
with its corporate trust offices located at , will
be the Indenture Trustee under the Indenture. In the ordinary course of its
business, the Indenture Trustee and its affiliates have engaged and may in the
future engage in commercial banking or financial advisory transactions with the
Bank and its affiliates.
PAYMENTS OF INTEREST
Each class of the Notes offered hereby will constitute Fixed Rate
Securities as such term is defined under 'Certain Information Regarding the
Securities--Fixed Rate Securities' in the Prospectus. Interest on the principal
balances of each class of Notes will accrue at the related per annum Interest
Rate and will be payable to the Noteholders monthly on each Distribution Date,
commencing , 199 . Interest on the outstanding principal amount of each
class of Notes will accrue at the related Interest Rate for each Interest
Accrual Period and shall be calculated on the basis of a 360-day year based on
the actual number of days, with respect to the Class A-1 Notes [(which will be
days with respect to the Interest Accrual Period for the
Distribution Date),] and on the basis of a 360-day year of twelve 30-day months,
with respect to the Class A-2 Notes, Class A-3 Notes, Class A-4 Notes and Class
A-5 Notes. Interest payments on the Notes will generally be derived from the
Total Distribution Amount and the amounts, if any, on deposit in the Reserve
Account remaining after the payment of the Servicing Fee and the Administration
Fee. See 'Description of the Transfer and Servicing Agreements--Distributions'
and '--Subordination of Certificateholders; Reserve Account' herein.
Interest payments to all classes of Noteholders will have the same
priority. Under certain circumstances, the amount available for interest
payments could be less than the amount of interest payable on the Notes on any
Distribution Date, in which case each class of Noteholders will receive their
ratable share (based upon the aggregate amount of interest due to such class of
Noteholders) of the aggregate amount available to be distributed in respect of
interest on the Notes.
PAYMENTS OF PRINCIPAL
Principal payments will be made to the Noteholders on each Distribution
Date in an amount generally equal to the Noteholders' Principal Distributable
Amount. Principal payments on the Notes will generally be derived from the Total
Distribution Amount and the amounts, if any, on deposit in the Reserve Account
remaining after the payment of the Servicing Fee, the Administration Fee, the
Noteholders' Interest Distributable Amount and the Certificateholders' Interest
Distributable Amount.
On each Distribution Date, principal payments on the Notes, to the extent
of the Noteholders' Principal Distributable Amount, will be applied in the
following order of priority: (i) to the principal balance of the Class A-1 Notes
until the principal balance of the Class A-1 Notes is reduced to zero; (ii) to
the principal balance of the Class A-2 Notes until the principal balance of the
Class A-2 Notes is reduced to zero; (iii) to the principal balance of the Class
A-3 Notes until the principal balance of the Class A-3 Notes is reduced to zero;
(iv) to the principal balance of the Class A-4 Notes until the principal balance
of the Class A-4 Notes is reduced to zero; and (v) to the principal balance of
the Class A-5 Notes until the principal balance of the Class A-5 Notes is
reduced to
S-26
<PAGE>
zero. Notwithstanding the foregoing, if an Event of Default has occurred and the
Notes have been accelerated, the Noteholders' Principal Distributable Amount
shall be applied to the repayment of principal on each class of Notes pro rata
on the basis of their respective unpaid principal amounts. The principal balance
of the Class A-1 Notes, to the extent not previously paid, will be due on the
Class A-1 Final Scheduled Distribution Date, the principal balance of the Class
A-2 Notes, to the extent not previously paid, will be due on the Class A-2 Final
Scheduled Distribution Date, the principal balance of the Class A-3 Notes, to
the extent not previously paid, will be due on the Class A-3 Final Scheduled
Distribution Date, the principal balance of the Class A-4 Notes, to the extent
not previously paid, will be due on the Class A-4 Final Scheduled Distribution
Date and the principal balance of the Class A-5 Notes, to the extent not
previously paid, will be due on the Class A-5 Final Scheduled Distribution Date.
The actual date on which the aggregate outstanding principal amount of any class
of Notes is paid may be earlier than the respective Note Final Scheduled
Distribution Dates set forth above based on a variety of factors, including
those described under 'Weighted Average Life of the Securities' herein and in
the Prospectus.
OPTIONAL REDEMPTION
On any Distribution Date after the Class A-1 Notes, Class A-2 Notes, Class
A-3 Notes and Class A-4 Notes have been paid in full, the Class A-5 Notes will
be redeemed in whole, but not in part, if the Servicer exercises its option to
purchase the Receivables. The Servicer may purchase the Receivables after the
last day of a Collection Period as to which the Pool Balance shall have declined
to 5% or less of the Original Pool Balance, as described in the Prospectus under
'Description of the Transfer and Servicing Agreements--Termination.' The
redemption price will be equal to the unpaid principal amount of the Class A-5
Notes plus accrued and unpaid interest thereon.
DESCRIPTION OF THE CERTIFICATES
GENERAL
The Certificates will be issued pursuant to the terms of the Trust
Agreement, a form of which has been filed as an exhibit to the Registration
Statement. A copy of the Trust Agreement will be filed with the Commission
following the issuance of the Securities. The following, as well as other
pertinent information included elsewhere in this Prospectus Supplement and in
the Prospectus, summarizes the material terms of the Certificates and the Trust
Agreement. The summary does not purport to be complete and is subject to, and
qualified in its entirety by reference to, all the provisions of the
Certificates and the Trust Agreement. The following summary supplements the
description of the general terms and provisions of the Certificates of any given
series and the related Trust Agreement set forth in the Prospectus, to which
description reference is hereby made.
RESTRICTIONS ON OWNERSHIP
Purchasers of Certificates and their assignees will be deemed to represent
that the beneficial owners of such Certificates are not Foreign Investors and
that no assets of a Plan were used to acquire the Certificates. See 'Certain
Federal Income Tax Consequences' herein and 'ERISA Considerations' herein and in
the Prospectus.
DISTRIBUTION OF INTEREST INCOME
On each Distribution Date, commencing , 199 , the
Certificateholders will be entitled to distributions in an amount equal to the
amount of interest that would accrue on the Certificate Balance at the
Certificate Rate. The Certificates will constitute Fixed Rate Securities, as
such term is defined under 'Certain Information Regarding the Securities--Fixed
Rate Securities' in the Prospectus. Interest in respect of a Distribution Date
will accrue during the related Interest Accrual Period and shall be calculated
on the basis of a 360-day year of twelve 30-day months. Interest distributions
due for any Distribution Date but not distributed on such Distribution Date will
be due on the next Distribution Date in addition to an amount equal to interest
on such amount at the Certificate Rate (to the extent lawful). Interest
distributions with respect to the Certificates
S-27
<PAGE>
will generally be derived from the Total Distribution Amount and amounts, if
any, on deposit in the Reserve Account remaining after the payment of the
Servicing Fee, the Administration Fee and the Noteholders' Interest
Distributable Amount. See 'Description of the Transfer and Servicing
Agreement--Distributions' and '--Subordination of the Certificates; Reserve
Account' herein.
The Certificateholders will not receive any distributions of interest with
respect to an Interest Accrual Period until the full amount of interest on the
Notes due with respect to such Interest Accrual Period has been deposited in the
Note Distribution Account. If an Event of Default shall occur and the Notes are
accelerated, distribution of all amounts on the Certificates will be
subordinated to payment of principal of the Notes.
DISTRIBUTIONS OF PRINCIPAL PAYMENTS
Certificateholders will be entitled to distributions of principal on each
Distribution Date in an amount generally equal to the Certificateholders'
Principal Distributable Amount. The Certificateholders' Principal Distributable
Amount will be zero for each Distribution Date occurring before the Distribution
Date on which the Notes have been paid in full; and on and after such
Distribution Date, it will generally be 100% of the Principal Distributable
Amount (after payment of all of the Notes in full). If the Servicer exercises
its option to purchase the Receivables when the then outstanding Pool Balance
declines to 5% or less of the Original Pool Balance, Certificateholders will
receive an amount in respect of the Certificates equal to the Certificate
Balance together with accrued interest at the Certificate Rate, which
distribution shall effect early retirement of the Certificates. See 'Description
of the Transfer and Servicing Agreements--Termination' in the Prospectus.
Distributions with respect to principal payments will generally be derived from
the Total Distribution Amount and amounts, if any, on deposit in the Reserve
Account remaining after the payment of the Servicing Fee, the Administration
Fee, the Noteholders' Interest Distributable Amount, the Noteholders' Principal
Distributable Amount and the Certificateholders' Interest Distributable Amount.
Notwithstanding the foregoing, if an Event of Default has occurred and the Notes
have been accelerated, the Certificateholders will not be entitled to receive
any distributions of interest or principal until the Notes have been paid in
full. See 'Description of the Transfer and Servicing Agreements--Distributions'
and 'Subordination of Certificateholders; Reserve Account' herein.
OPTIONAL PREPAYMENT
If the Servicer exercises its option to purchase the Receivables after the
last day of a Collection Period on which the Pool Balance declines to 5% or less
of the Original Pool Balance, Certificateholders will receive an amount in
respect of the Certificates equal to the outstanding Certificate Balance
together with accrued interest at the Certificate Rate, which distribution shall
effect early retirement of the Certificates. Any outstanding Class A-5 Notes
will be redeemed simultaneously with the Certificates. See 'Description of the
Transfer and Servicing Agreements--Termination' in the Prospectus.
DESCRIPTION OF THE TRANSFER AND SERVICING AGREEMENTS
The following, as well as other information included elsewhere in this
Prospectus Supplement and in the Prospectus, summarizes the material terms of
the Sale and Servicing Agreement, the Trust Agreement and the Administration
Agreement (collectively, the 'TRANSFER AND SERVICING AGREEMENTS'). A form of
each of the Transfer and Servicing Agreements has been filed as an exhibit to
the Registration Statement. A copy of each of the Transfer and Servicing
Agreements will be filed with the Commission following the issuance of the
Securities. The summary does not purport to be complete and is subject to, and
qualified in its entirety by reference to, all the provisions of the Transfer
and Servicing Agreements. The following summary supplements the description of
the general terms and provisions of the Transfer and Servicing Agreements set
forth in the Prospectus, to which description reference is hereby made.
S-28
<PAGE>
ACCOUNTS
The Servicer will establish the Collection Account [and the Paid-Ahead
Account] in the name of the Indenture Trustee on behalf of the Noteholders and
the Certificateholders and the Note Distribution Account in the name of the
Indenture Trustee on behalf of the Noteholders. The Owner Trustee will establish
the Certificate Distribution Account in the name of the Owner Trustee on behalf
of the Certificateholders. The Seller will establish the Reserve Account in the
name of the Indenture Trustee on behalf of the Noteholders and the
Certificateholders. Each of such accounts will be a 'TRUST ACCOUNT' as described
under 'Description of the Transfer and Servicing Agreements--Accounts' in the
Prospectus. Each of the Collection Account, [the Paid-Ahead Account,] the Note
Distribution Account and the Certificate Distribution Account will be
established initially with the trust department of Chase. Chase, in its capacity
as the initial paying agent (the 'PAYING AGENT'), will have the revocable right,
at the direction of the Servicer, to withdraw funds from each Trust Account
(other than the Reserve Account) for the purpose of making distributions to
Securityholders in the manner provided in the Transfer and Servicing Agreements.
See '--Subordination of Certificateholders; Reserve Account' below.
[PAID-AHEAD ACTUARIAL RECEIVABLES
Early payments by or on behalf of Obligors on Actuarial Receivables which
do not constitute scheduled payments, full payments, nor certain partial
prepayments that result in a reduction of the Obligor's periodic payment below
the scheduled payment as of the Cutoff Date (a 'PAID-AHEAD') will be deposited
into the Paid-Ahead Account until such time as the Paid-Ahead falls due. Until
such time as Paid-Aheads are transferred from the Paid-Ahead Account to the
Collection Account, they will not constitute collected interest or collected
principal and will not be available for distribution to the Noteholders or
Certificateholders. So long as Chase USA is the Servicer and provided that (i)
there exists no Event of Servicing Termination and (ii) each other condition to
holding Paid-Aheads as may be required by the Sale and Servicing Agreement is
satisfied, Paid-Aheads may be retained by the Servicer until the applicable
Payment Date or Distribution Date.]
SERVICING COMPENSATION AND PAYMENT OF EXPENSES
The Servicer will be entitled to receive the Servicing Fee for each
Collection Period payable on each Distribution Date. The 'SERVICING FEE RATE'
with respect to the Servicing Fee for the Servicer will be % per annum, and the
'SERVICING FEE' for any Collection Period shall equal an amount equal to the sum
of (i) the product of one-twelfth of the Servicing Fee Rate and the Pool Balance
as of the close of business on the related Settlement Date and (ii) any Late
Fees paid by the Obligors during the related Collection Period. 'LATE FEES'
shall mean, collectively, any late charges, credit-related extension fees or
other administrative fees or similar charges allowed by applicable law with
respect to the Receivables. In addition, the Servicing Fee will also include
Investment Earnings on amounts on deposit in the Collection Account [and the
Paid-Ahead Account].
The amount of the Servicing Fee was determined in light of the duties of
the Servicer under the Transfer and Servicing Agreements as well as with a view
toward providing the Servicer with a reasonable profit. See 'Description of the
Transfer and Servicing Agreements--Servicing Compensation and Payment of
Expenses' and '--Net Deposits' in the Prospectus.
SERVICING PROCEDURES
The Servicer will service the Receivables and will make reasonable efforts
to collect all payments due with respect to the Receivables and, in a manner
consistent with the Sale and Servicing Agreement and with the terms of the
Receivables, will follow such collection and servicing procedures as it follows
with respect to comparable new or used automobile receivables that it services
for itself and that are consistent with prudent industry standards. In addition,
among other things, the Sale and Servicing Agreement will provide that the
Servicer may not change the amount of any Receivable (except with respect to a
prepayment of a scheduled payment that does not result in a deferral of any
other scheduled payment), decrease the Contract Rate of any Receivable, or
extend any Receivable beyond the Final Scheduled Maturity Date.
S-29
<PAGE>
In the event that the Servicer fails to comply with the foregoing terms of
the Sale and Servicing Agreement and such failure materially and adversely
affects the interests of the Securityholders in a Receivable, it will be
required to purchase the affected Receivable at a price equal to the Repurchase
Amount as of the last day of the Collection Period on which it became aware or
receives written notice from the Indenture Trustee or the Owner Trustee of such
failure. The purchase obligation will constitute the sole remedy available to
the Securityholders, the Trust or the Indenture Trustee for any such uncured
breach.
The Bank will offer certain Obligors or classes of Obligors on an annual
basis a one month noncredit related extension of a regularly scheduled payment
otherwise due under a Receivable. The Sale and Servicing Agreement establishes
criteria governing such extensions.
See 'Description of the Transfer and Servicing Agreements--Servicing
Procedures' in the Prospectus.
DISTRIBUTIONS
Deposits to Collection Account. On or before the 10th day of each month
(or, if such 10th day is not a Business Day, the preceding Business Day), the
Servicer will inform the Indenture Trustee, the Owner Trustee and the Paying
Agent of the following amounts: (i) the Available Interest, the Available
Principal, the Principal Distribution Amount and the Total Distribution Amount
for the next succeeding Distribution Date; (ii) the aggregate Repurchase Amount
of Receivables to be repurchased by the Seller or purchased by the Servicer with
respect to the preceding Collection Period; (iii) the amount to be withdrawn
from the Reserve Account on the next succeeding Deposit Date; (iv) the
Noteholders' Interest Distributable Amount, the Noteholders' Principal
Distributable Amount, the Certificateholders' Interest Distributable Amount and
the Certificateholders' Principal Distributable Amount for the next succeeding
Distribution Date; (v) the Servicing Fee; (vi) the Administration Fee and (vii)
the amount to be deposited in the Reserve Account and the amount to be
distributed to the Seller therefrom on such Distribution Date.
On or before each Deposit Date, the Servicer will cause all collections and
other amounts constituting the Total Distribution Amount for the related
Distribution Date to be deposited into the Collection Account together with any
amounts withdrawn by the Indenture Trustee from the Reserve Account on such
Deposit Date. [If the Class A-1 Notes are outstanding after the
Distribution Date, there will be a separate Deposit Date in with
respect to the Class A-1 Final Scheduled Distribution Date.]
The 'TOTAL DISTRIBUTION AMOUNT' for any Distribution Date will be the sum
of Available Interest and Available Principal for such Distribution Date. The
Total Distribution Amount for any Distribution Date will exclude all payments
and proceeds (including any Liquidation Proceeds and any amounts received from
Dealers with respect to Receivables) of (i) any Receivables the Repurchase
Amount of which has been included in the Total Distribution Amount for a prior
Distribution Date, and (ii) Investment Earnings on the Collection Account [, the
Paid-Ahead Account] and any Late Fees.
Deposits to the Distribution Accounts. On each Distribution Date
[(including, on the Class A-1 Final Scheduled Distribution Date if the Class A-1
Notes are outstanding, certain of the following allocations)], the Servicer
shall instruct the Indenture Trustee or the Paying Agent to make the following
distributions, to the extent of the sum of the Total Distribution Amount and any
amounts withdrawn from the Reserve Account then on deposit in the Collection
Account, in the following order of priority (except under the limited
circumstances provided herein):
(i) to the Servicer, the Servicing Fee for the preceding Collection
Period and all unpaid Servicing Fees from prior Collection Periods, to the
extent such amounts are not deducted from the Servicer's remittance to the
Collection Account;
(ii) to the Administrator, the Administration Fee for the preceding
Collection Period and all unpaid Administration Fees from prior Collection
Periods;
(iii) to the Note Distribution Account, the Noteholders' Interest
Distributable Amount;
(iv) to the Owner Trustee for deposit in the Certificate Distribution
Account, the Certificateholders' Interest Distributable Amount (unless the
Notes have been accelerated as described herein);
S-30
<PAGE>
(v) to the Note Distribution Account, the Noteholders' Principal
Distributable Amount;
(vi) to the Owner Trustee for deposit in the Certificate Distribution
Account, the Certificateholders' Principal Distributable Amount; and
(vii) to the Reserve Account, any remaining portion of the Total
Distribution Amount.
For purposes hereof, the following terms shall have the following meanings:
'AVAILABLE INTEREST' means, for any Distribution Date, that portion of
collections on the Receivables received during the related Collection Period
allocated to interest and to the extent attributable to interest, the Repurchase
Amount received with respect to each Receivable repurchased by the Seller or
purchased by the Servicer under an obligation that arose during the related
Collection Period.
'AVAILABLE PRINCIPAL' means, for any Distribution Date, that portion of
collections on the Receivables received during the related Collection Period
allocated to the principal balance of the Receivables, and, to the extent
attributable to principal, the Repurchase Amount received with respect to each
Receivable repurchased by the Seller or purchased by the Servicer under an
obligation that arose during the related Collection Period.
'CERTIFICATE BALANCE' of the Certificates shall be an amount equal to
$ (approximately % of the Original Pool Balance) as of the Closing
Date and, thereafter, shall be an amount equal to such initial Certificate
Balance, reduced by all amounts allocable to principal previously distributed to
Certificateholders. The Certificate Balance shall also be reduced on any
Distribution Date by the excess, if any, of (i) the sum of (A) the Certificate
Balance and (B) the outstanding principal amount of the Notes (in each case
after giving effect to amounts in respect of principal to be deposited in the
Certificate Distribution Account and the Note Distribution Account on such
Distribution Date) over (ii) the Pool Balance as of the close of business on the
last day of the preceding Collection Period. Thereafter, the Certificate Balance
shall be increased on any Distribution Date to the extent that any portion of
the Total Distribution Amount on such Distribution Date is available to pay the
existing Certificateholders' Principal Carryover Shortfall, but not by more than
the aggregate reductions in the Certificate Balance set forth in the preceding
sentence.
'CERTIFICATEHOLDERS' DISTRIBUTABLE AMOUNT' means, for any Distribution
Date, the sum of the Certificateholders' Principal Distributable Amount and the
Certificateholders' Interest Distributable Amount.
'CERTIFICATEHOLDERS' INTEREST CARRYOVER SHORTFALL' means (a) for the
initial Distribution Date, zero, and (b) for any other Distribution Date, the
excess of the Certificateholders' Interest Distributable Amount for the
preceding Distribution Date over the amount in respect of interest at the
Certificate Rate actually deposited in the Certificate Distribution Account on
such preceding Distribution Date, plus interest on such excess, to the extent
permitted by law, at the Certificate Rate from and including such preceding
Distribution Date to, but excluding the current Distribution Date.
'CERTIFICATEHOLDERS' INTEREST DISTRIBUTABLE AMOUNT' means, for any
Distribution Date, the sum of the Certificateholders' Monthly Interest
Distributable Amount for such Distribution Date and the Certificateholders'
Interest Carryover Shortfall for such Distribution Date.
'CERTIFICATEHOLDERS' MONTHLY INTEREST DISTRIBUTABLE AMOUNT' means, for any
Distribution Date, one month's interest (or, in the case of the first
Distribution Date, interest accrued from and including the Closing Date to but
excluding such Distribution Date) at the Certificate Rate on the Certificate
Balance on the immediately preceding Distribution Date (or, in the case of the
first Distribution Date, the Certificate Balance on the Closing Date), after
giving effect to all payments of principal to the Certificateholders on or prior
to such Distribution Date.
'CERTIFICATEHOLDERS' MONTHLY PRINCIPAL DISTRIBUTABLE AMOUNT' means, for any
Distribution Date prior to the Distribution Date on which the Notes have been
paid in full, zero, and for any Distribution Date commencing on or after the
Distribution Date on which the Notes have been paid in full, 100% of the
Principal Distribution Amount (less the portion of the Principal Distribution
Amount required on the first such Distribution Date to pay the Notes in full).
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'CERTIFICATEHOLDERS' PRINCIPAL CARRYOVER SHORTFALL' means, for any
Distribution Date, the sum of (a) the excess of (i) the Certificateholders'
Principal Distributable Amount for the preceding Distribution Date, over (ii)
the amount in respect of principal actually deposited in the Certificate
Distribution Account on such Distribution Date and (b) without duplication of
clause (a), the unreimbursed portion of the amount by which the Certificate
Balance has been reduced pursuant to the second sentence of the definition
thereof.
'CERTIFICATEHOLDERS' PRINCIPAL DISTRIBUTABLE AMOUNT' means, for any
Distribution Date, the sum of (i) the Certificateholders' Monthly Principal
Distributable Amount for such Distribution Date and (ii) the Certificateholders'
Principal Carryover Shortfall for such Distribution Date; provided, that the
Certificateholders' Principal Distributable Amount shall not exceed the
Certificate Balance. In addition, on the Certificate Final Scheduled
Distribution Date, the principal required to be distributed to
Certificateholders will include the lesser of (a) any payments of principal due
and remaining unpaid on each Receivable owned by the Issuer as of the last day
of the immediately preceding Collection Period, or (b) the amount that is
necessary (after giving effect to the other amounts to be deposited in the
Certificate Distribution Account on such Distribution Date and allocable to
principal) to reduce the Certificate Balance to zero, in either case, after
giving effect to any required distribution of the Noteholders' Principal
Distribution Amount to the Note Distribution Account.
'NOTEHOLDERS' DISTRIBUTABLE AMOUNT' means, for any Distribution Date, the
sum of the Noteholders' Principal Distributable Amount and the Noteholders'
Interest Distributable Amount.
'NOTEHOLDERS' INTEREST CARRYOVER SHORTFALL' means (a) for the initial
Distribution Date, zero, and (b) for any other Distribution Date, the excess of
(i) the Noteholders' Interest Distributable Amount for the preceding
Distribution Date, over (ii) the amount in respect of interest that was actually
deposited in the Note Distribution Account on such preceding Distribution Date,
plus interest on the amount of interest due but not paid to Noteholders of each
class 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 Accrual Period.
'NOTEHOLDERS' INTEREST DISTRIBUTABLE AMOUNT' means, for any Distribution
Date, the sum of (x) the Noteholders' Monthly Interest Distributable Amount for
all classes of Notes for such Distribution Date and (y) the Noteholders'
Interest Carryover Shortfall for such Distribution Date.
'NOTEHOLDERS' MONTHLY INTEREST DISTRIBUTABLE AMOUNT' means, for any
Distribution Date, in the case of each class of Notes, interest accrued during
the related Interest Accrual Period at the related Interest Rate on the
outstanding principal balance of the Notes of such class on such Distribution
Date (or, in the case of the first Distribution Date, on the Closing Date).
'NOTEHOLDERS' MONTHLY PRINCIPAL DISTRIBUTABLE AMOUNT' means, for any
Distribution Date, prior to the Distribution Date on which the Notes have been
paid in full, 100% of the Principal Distribution Amount, and for the
Distribution Date on which the Notes are paid in full, the portion of the
Principal Distribution Amount required to pay the Notes in full.
'NOTEHOLDERS' PRINCIPAL CARRYOVER SHORTFALL' means, for any Distribution
Date, the excess of (x) the Noteholders' Principal Distributable Amount for the
preceding Distribution Date over (y) the amount in respect of principal that was
actually deposited in the Note Distribution Account on such Distribution Date.
'NOTEHOLDERS' PRINCIPAL DISTRIBUTABLE AMOUNT' means, for any Distribution
Date, the sum of (i) the Noteholders' Monthly Principal Distributable Amount for
such Distribution Date and (ii) the Noteholders' Principal Carryover Shortfall
for such preceding Distribution Date; provided, that the Noteholders' Principal
Distributable Amount shall not exceed the outstanding principal balance of the
Notes. In addition, on the Note Final Scheduled Distribution Date of each class
of Notes, the principal required to be deposited in the Note Distribution
Account will include the amount necessary (after giving effect to other amounts
to be deposited in the Note Distribution Account on such Distribution Date and
allocable to principal) to reduce the outstanding principal balance of the
related class of Notes to zero.
The 'PRINCIPAL DISTRIBUTION AMOUNT' means, for any Distribution Date, the
sum of the following amounts, without duplication, for such Distribution Date:
(i) Available Principal and (ii) Aggregate Net Losses.
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Notwithstanding the foregoing, if an Event of Default has occurred and the
Notes have been accelerated, the Certificateholders will not be entitled to
receive any distributions in respect of their Certificates until the Notes have
been paid in full.
SUBORDINATION OF CERTIFICATEHOLDERS; RESERVE ACCOUNT
The rights of the Certificateholders to receive distributions with respect
to the Receivables generally will be subordinated to the rights of the
Noteholders in the event of defaults and delinquencies on the Receivables as
provided in the Sale and Servicing Agreement. The protection afforded to the
Noteholders through subordination will be effected both by the preferential
right of the Noteholders to receive current distributions with respect to the
Receivables and by the establishment of the Reserve Account. The Reserve Account
will be funded with an initial deposit by the Seller of cash or Permitted
Investments having an aggregate value of at least the Reserve Account Initial
Deposit. In addition, on each Distribution Date, the Reserve Account will be
augmented by the deposit therein of the Total Distribution Amount remaining
after the payment of the Servicing Fee, the Administration Fee, the deposit of
the Noteholders' Distributable Amount in the Note Distribution Account, and the
deposit of the Certificateholders' Distributable Amount in the Certificate
Distribution Account, in each case as described above under '--Distributions.'
On each Distribution Date, any amounts on deposit in the Reserve Account (after
giving effect to deposits and withdrawals made on such Distribution Date) in
excess of the Specified Reserve Account Balance on such Distribution Date will
be released to the Seller.
Under the Sale and Servicing Agreement, on each Deposit Date, the Indenture
Trustee is required to demand a withdrawal from the amounts on deposit in the
Reserve Account, up to the Available Reserve Account Amount, in an amount equal
to the excess, if any, of the sum of the Noteholders' Distributable Amount and
the Certificateholders' Distributable Amount for the related Distribution Date
over the Total Distribution Amount for such Distribution Date (after the payment
of the Servicing Fee and the Administration Fee for such Distribution Date).
Amounts so withdrawn will be deposited in the Collection Account.
On each Distribution Date, the amount available in the Reserve Account (the
'AVAILABLE RESERVE ACCOUNT AMOUNT') will equal the lesser of (i) the amount on
deposit in the Reserve Account and (ii) the Specified Reserve Account Balance.
The aggregate amount withdrawn from the Reserve Account on any Deposit Date may
not exceed the Available Reserve Account Amount with respect to the related
Distribution Date.
The Specified Reserve Account Balance on any Distribution Date will equal
% of the Pool Balance as of the related Settlement Date, but in any event
will not be less than the lesser of (i) $ ( % of the Original
Pool Balance) and (ii) the sum of (A) such Pool Balance plus (B) an amount
sufficient to pay interest on each class of Notes and the Certificates through
its related Note Final Scheduled Distribution Date or the Final Certificate
Scheduled Distribution Date, in each case, at a rate equal to the sum of the
related Interest Rate or the Certificate Rate plus the Servicing Fee Rate;
provided, that the Specified Reserve Account Balance will be calculated using a
percentage of % on any Distribution Date (beginning with the
Distribution Date) for which the Average Net Loss Ratio exceeds
% or the Average Delinquency Percentage exceeds %.
'AGGREGATE NET LOSSES' means, for any Distribution Date, the amount equal
to (i) the aggregate principal balance of all Receivables that became Defaulted
Receivables during the related Collection Period minus (ii) the Liquidation
Proceeds allocable to principal collected during such Collection Period with
respect to any Defaulted Receivables.
'AVERAGE DELINQUENCY PERCENTAGE' means, for any Distribution Date, the
average of the Delinquency Percentages for such Distribution Date and the
preceding two Distribution Dates.
'AVERAGE NET LOSS RATIO' means, for any Distribution Date, the average of
the Net Loss Ratios for such Distribution Date and the preceding two
Distribution Dates.
'DELINQUENCY PERCENTAGE' means, for any Distribution Date, the sum of the
outstanding principal balances of all Receivables which are 60 days or more
delinquent (including Receivables, which are not Defaulted Receivables, relating
to Financed Vehicles that have been repossessed), as of the close of business on
the last day of the Collection Period immediately preceding such Distribution
Date, determined in accordance
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with the Servicer's normal practices, such sum expressed as a percentage of the
Pool Balance as of the close of business on the last day of such Collection
Period.
'LIQUIDATION PROCEEDS' means with respect to any Receivable, (i) insurance
proceeds, (ii) the monies collected during a Collection Period from whatever
source on a Defaulted Receivable and (iii) proceeds of a Financed Vehicle sold
after repossession, in each case, net of any liquidation expenses and payments
required by law to be remitted to the Obligor.
'NET LOSS RATIO' means, for any Distribution Date, an amount expressed as a
percentage, equal to (i) the Aggregate Net Losses for such Distribution Date,
divided by (ii) the average of the Pool Balances on each of the related
Settlement Date and the last day of the related Collection Period.
The Specified Reserve Account Balance may be reduced to a lesser amount as
determined by the Seller; provided, that such reduction may not adversely affect
any rating of the Securities by a Rating Agency. Upon distribution to the Seller
of amounts from the Reserve Account, the Securityholders will not have any
rights in, or claims to, such amounts.
The subordination of the Certificates and the Reserve Account are intended
to enhance the likelihood of receipt by Noteholders of the full amount of
principal and interest due them and to decrease the likelihood that the
Noteholders will experience losses. In addition, the Reserve Account is intended
to enhance the likelihood of receipt by Certificateholders of the full amount of
principal and interest due them and to decrease the likelihood that the
Certificateholders will experience losses. However, in certain circumstances,
the Reserve Account could be depleted. If the amount required to be withdrawn
from the Reserve Account to cover shortfalls in collections on the Receivables
exceeds the amount of available cash in the Reserve Account, Noteholders or
Certificateholders could incur losses or a temporary shortfall in the amounts
distributed to the Noteholders or the Certificateholders could result, which
could, in turn, increase the average life of the Notes or the Certificates. Such
shortfalls may result from, among other things, Aggregate Net Losses on the
Receivables or the failure by the Servicer to make any remittance under the Sale
and Servicing Agreement.
ADMINISTRATION AGREEMENT
Chase, as the Administrator, will enter into the Administration Agreement
with the Trust and the Indenture Trustee pursuant to which the Administrator
will agree to provide the notices and to perform on behalf of the Trust certain
other administrative functions. As compensation for the performance of the
Administrator's obligations under the Administration Agreement, the
Administrator will be entitled to receive the Administration Fee.
The Administration Agreement provides that the Administrator may act
directly or through its agents or attorneys pursuant to agreements entered into
with any of them, and that the Administrator will not be liable for the conduct
or misconduct of such agents or attorneys if such agents or attorneys shall have
been selected by the Administrator with due care. Chase USA will enter into a
side agreement with the Administrator pursuant to which Chase USA will agree to
perform certain of the duties of the Administrator set forth in the
Administration Agreement and to reimburse and indemnify the Administrator for
all expenses or liabilities the Administrator may incur as a result of its
entering into the Administration Agreement.
[LEGAL INVESTMENT
The Class A-1 Notes will be eligible securities for purchase by money
market funds under paragraph (a)(9) of Rule 2a-7 under the Investment Company
Act of 1940, as amended.]
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CERTAIN FEDERAL INCOME TAX CONSEQUENCES
The following is a general summary of the material United States ('U.S.')
federal income tax consequences that may be relevant to the purchase, ownership
and disposition of the Notes and the Certificates by an investor who purchases
the Notes or the Certificates pursuant to their original issuance at their
original issue price. This summary is based upon the Internal Revenue Code of
1986, as amended (the 'CODE'), the Treasury regulations promulgated thereunder,
administrative rulings or pronouncements and judicial decisions, all as in
effect on the date hereof and all of which are subject to change, possibly
retroactively. The following discussion does not deal with all aspects of U.S.
income taxation, nor does it address U.S. federal income tax consequences that
may be relevant to certain types of investors, such as banks, insurance
companies, dealers in securities, tax-exempt organizations or persons whose
functional currency is not the U.S. dollar, who may be subject to special
treatment under the Code. In addition, the following discussion does not address
the alternative minimum tax consequences of an investment in the Notes or the
Certificates or the consequences of such an investment under state and local tax
laws or foreign tax laws. Prospective investors should note that no rulings have
been or will be sought from the Internal Revenue Service ('IRS') with respect to
any of the U.S. federal income tax consequences discussed herein and opinions of
counsel are not binding on the IRS or the courts. Thus, no assurance can be
given that the IRS will not take positions contrary to those described below.
The opinions of Simpson Thacher & Bartlett, special counsel to the Seller
('FEDERAL TAX COUNSEL'), described herein will be based upon certain
representations and assumptions, including, but not limited to, the assumption
that all relevant parties will comply with the terms of the Trust Agreement and
related documents.
This summary is intended as an explanatory discussion of the possible
effects of the classification of the Trust as a partnership for U.S. federal
income tax purposes for investors generally and related tax matters affecting
investors generally, but does not purport to furnish information in the level of
detail or with the attention to the investor's specific tax circumstances that
would be provided by an investor's own tax adviser. Accordingly, investors
should consult their own tax advisors to determine the federal, state, local,
and other tax consequences that may be relevant to their purchase, ownership and
disposition of the Notes or the Certificates based upon their particular facts
and circumstances.
For purposes of the following discussion, except as otherwise provided
herein, the terms 'NOTEHOLDER' and 'CERTIFICATEHOLDER' refer, respectively, to
the beneficial owner of a Note or Certificate. In addition, the discussion below
assumes that Noteholders and Certificateholders will hold their Notes and
Certificates as 'capital assets' within the meaning of Section 1221 of the Code.
TAX CHARACTERIZATION OF THE TRUST.
In the opinion of Federal Tax Counsel, the Trust will not be classified
as an association (or publicly traded partnership) taxable as a corporation.
This opinion is based on, among other things, certain facts and assumptions
contained in such opinion and Federal Tax Counsel's conclusion that the nature
of the Trust's income exempts it from the rule that certain publicly traded
partnerships are taxable as corporations.
The Seller and the Certificateholders, by their purchase of Certificates,
will agree to treat the Trust as a partnership for all U.S. tax purposes with
the assets of such partnership being the assets held by the Trust (including the
Reserve Account and all Investment Earnings earned thereon), the partners of the
partnership being the Certificateholders and the Seller, and the Notes being
debt of the partnership. However, the proper characterization of the arrangement
involving the Trust, the Certificateholders, the Noteholders and the Seller is
not clear.
A variety of alternative characterizations are possible. For example,
because the Certificates have certain features characteristic of debt, the
Certificates might be considered debt of the Seller or the Trust. Any such
characterization generally would not result in materially adverse tax
consequences as compared to the tax consequences that will result from treating
the Certificates as equity interests in a partnership which are described below
under the caption 'Tax Consequences to Certificateholders.' The following
discussion assumes that, for U.S. federal income tax purposes, (i) the Trust
will be classified as a partnership (other than a publicly traded partnership)
and (ii) the Certificates will represent equity interests in such partnership.
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TAX CONSEQUENCES TO NOTEHOLDERS
Treatment of the Notes as Indebtedness. The Trust and the Noteholders, by
their purchase of the Notes, agree to treat the Notes as debt for all U.S. tax
purposes. In the opinion of Federal Tax Counsel, the Notes will be characterized
as debt for U.S. federal income tax purposes. The discussion below assumes this
characterization of the Notes is correct.
Interest Income on the Notes. The Notes will not be considered to have
been issued with original issue discount ('OID') in excess of the statutorily
defined de minimis amount (i.e., 1/4% of the principal amount of a Note
multiplied by its weighted average to maturity). Consequently, the stated
interest thereon will be taxable to a Noteholder as ordinary interest income at
the time it is received or accrued in accordance with such Noteholder's method
of tax accounting. Under the applicable Treasury regulations, a holder of a Note
issued with a de minimis amount of OID must include gain attributable to such
OID in income, on a pro rata basis, as principal payments are made on the Note.
A purchaser who buys a Note for more or less than its principal amount generally
will be subject, respectively, to the premium amortization or market discount
rules of the Code.
Sale or Other Disposition. If a Noteholder sells or otherwise disposes of
a Note in a taxable transaction, the former Noteholder will recognize gain or
loss in an amount equal to the difference between the amount realized on such
sale or other disposition and the former Noteholder's adjusted tax basis in the
Note. The adjusted tax basis of a Note to a particular Noteholder generally will
equal the holder's cost therefor increased by any market discount previously
included in income by such Noteholder and decreased by the amount of bond
premium (if any) previously amortized and the amount of any payments, other than
payments of stated interest, previously received by such Noteholder with respect
to such Note. Any such gain or loss will be capital gain or loss if the Note was
held as a capital asset, except to the extent such gain represents accrued
interest or accrued market discount not previously included in income. Capital
losses generally may be used only to offset capital gains.
Foreign Noteholders. For purposes of this discussion, the term 'FOREIGN
INVESTOR' means any person other than (i) a citizen or resident of the United
States, (ii) a corporation or partnership organized in or under the laws of the
United States or any political subdivision thereof, (iii) an estate, the income
of which is includible in gross income for U.S. federal income tax purposes
regardless of its source, or (iv) a trust if the primary supervision over the
administration of such trust can be exercised by a court within the United
States and one or more U.S. persons have the authority to control all
substantial decisions of such trust.
Under present U.S. federal income tax law, and subject to the discussion
below concerning backup withholding:
(a) no withholding of U.S. federal income tax will be required with
respect to the payment by the Trust of principal or interest on a Note
owned by a Foreign Investor, provided that the beneficial owner of the Note
(i) is not actually or constructively a '10 percent shareholder' of the
Trust (including a holder of 10% or more of such Trust's outstanding
Certificates) or the Seller, (ii) is not a 'controlled foreign corporation'
with respect to which the Trust or the Seller is a 'related person' within
the meaning of the Code and (iii) satisfies the statement requirement
(described generally below) set forth in Section 871(h) and Section 881(c)
of the Code and the regulations thereunder; and
(b) no withholding of U.S. federal income tax will be required with
respect to any gain realized by a Foreign Investor upon the sale, exchange
or retirement of a Note provided that, in the case of any gain representing
accrued interest, the conditions described in (a) above are satisfied.
To satisfy the requirement referred to in (a)(iii) above, the beneficial
owner of such Note, or a financial institution holding the Note on behalf of
such owner, must provide, in accordance with specified procedures, the U.S.
entity that would otherwise be required to withhold U.S. taxes with a statement
to the effect that the beneficial owner is not a U.S. person. Pursuant to
current temporary Treasury regulations, these requirements will be met if (i)
the beneficial owner provides his name and address, and certifies, under
penalties of perjury that he, she or it is not a 'U.S. person' (which
certification may be made on an IRS Form W-8 or successor form), or (ii) a
financial institution or securities clearing organization holding the Note on
behalf of such beneficial owner certifies, under penalties of perjury, that such
statement has been received by it and furnishes the U.S. entity otherwise
required to withhold U.S. taxes with a copy thereof.
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If a Foreign Investor cannot satisfy the requirements of the 'portfolio
interest' exception described in (a) above, payments of premium, if any, and
interest (including OID) made to a Foreign Investor with respect to a Note will
be subject to a 30% U.S. withholding tax unless the beneficial owner of the Note
provides the U.S. entity otherwise required to withhold U.S. taxes with a
properly executed (i) IRS Form 1001 (or successor form) claiming an exemption
from withholding under the benefit of a tax treaty or (ii) IRS Form 4224 (or
successor form) stating that the interest paid on the Note is not subject to
U.S. withholding tax because such interest income is effectively connected with
the beneficial owner's conduct of a trade or business in the United States.
If a Foreign Investor is engaged in a trade or business in the United
States and premium, if any, or interest on the Note is effectively connected
with the conduct of such trade or business, the Foreign Investor, although
exempt from the U.S. withholding tax discussed above, will be subject to U.S.
federal income tax on such premium, if any, and interest on a net income basis
in the same manner as if it were a U.S. person. In addition, if such Foreign
Investor is a foreign corporation, it may be subject to a branch profits tax
equal to 30% of its effectively connected earnings and profits for the taxable
year, subject to adjustments. For this purpose, such premium, if any, and
interest on the Note will be included in such foreign corporation's effectively
connected earnings and profits.
Any gain realized by a Foreign Investor upon the sale, exchange or
retirement of a Note generally will not be subject to U.S. federal income tax
unless (i) such gain or income is effectively connected with a trade or business
conducted by the Foreign Investor in the United States and (ii) in the case of a
Foreign Investor who is an individual, such individual is present in the United
States for 183 days or more in the taxable year of such sale, exchange or
retirement, and certain other conditions are met.
Information Reporting and Backup Withholding. In general, information
reporting requirements will apply to certain payment of principal, interest and
premium, if any, paid on the Notes and to the proceeds from the sale of a Note
paid to U.S. persons, other than certain exempt recipients (such as
corporations). A 31% U.S. backup withholding tax will apply to such payments if
the U.S. person fails to provide a taxpayer identification number or
certification of foreign or other exempt status or fails to report in full
dividend and interest income.
No information reporting or backup withholding will be required with
respect to payments made by the Trust to a Foreign Investor if a statement
described in (a)(iii) above under the caption 'Foreign Noteholders' has been
received by the U.S. entity otherwise required to withhold U.S. taxes and such
entity does not have actual knowledge that the beneficial owner is a U.S.
person.
In addition, backup withholding and information reporting will not apply if
payments of principal, interest and premium (if any) on a Note are paid or
collected by a foreign office of a custodian, nominee or other foreign agent on
behalf of the beneficial owner of such Note, or if a foreign office of a broker
(as defined in applicable Treasury regulations) pays the proceeds from the sale
of a Note to the owner thereof. If, however, such nominee, custodian, agent or
broker is, for U.S. federal income tax purposes, a U.S. person, a controlled
foreign corporation or a foreign person that derives 50% or more of its gross
income for certain periods from the conduct of a trade or business in the United
States, such payments will not be subject to backup withholding but will be
subject to information reporting, unless (i) such custodian, nominee, agent or
broker has documentary evidence in its records that the beneficial owner is not
a U.S. person and certain other conditions are met or (ii) the beneficial owner
otherwise establishes an exemption. Temporary Treasury regulations provide that
the Treasury is considering whether backup withholding will apply with respect
to such payments of principal, interest or the proceeds from a sale that are not
subject to backup withholding under the current regulations. Under proposed
Treasury regulations, not currently in effect, backup withholding will not apply
to such payments absent actual knowledge that the payee is a U.S. person.
Payments of principal, interest and premium (if any) on a Note paid to the
beneficial owner of a Note by a United States office of a custodian, nominee or
agent, or the payment by the United States office of a broker of the proceeds
from the sale of a Note, will be subject to both backup withholding and
information reporting unless the beneficial owner (i) provides the statement
referred to in (a)(iii) above and the payor does not have actual knowledge that
the beneficial owner is a U.S. person or (ii) otherwise establishes an
exemption.
Any amounts withheld under the backup withholding rules will be allowed as
a refund or a credit against such holder's U.S. federal income tax liability
provided the required information is furnished to the IRS.
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Possible Alternative Classification of the Notes. If, contrary to the
opinion of Federal Tax Counsel, the IRS successfully asserted that one or more
of the Notes did not represent debt for U.S. federal income tax purposes, the
Notes might be treated as equity interests in the Trust. Treatment of the Notes
as equity interests in the Trust could have adverse tax consequences to certain
Noteholders. For example, income to Foreign Investors generally would be subject
to U.S. tax and U.S. tax return filing and withholding requirements and
Noteholders who are individuals might be subject to certain limitations on their
ability to deduct their allocable share of the Trust's expenses. See 'Tax
Consequences to Certificateholders' below.
TAX CONSEQUENCES TO CERTIFICATEHOLDERS
Treatment of the Trust as a Partnership. As discussed above under the
caption 'Trust Treated as Partnership--Tax Characterization of the Trust', the
following discussion assumes that (i) the Trust will be treated as a partnership
(other than a publicly traded partnership) and (ii) the Certificates represent
equity interests in such partnership, for U.S. federal income tax purposes.
Partnership Taxation. As a partnership, the Trust will not be subject to
U.S. federal income tax. Rather, each Certificateholder will be required
separately to take into account such Certificateholder's allocable share of the
Trust's income, gains, losses, deductions and credits. The Trust's income will
consist primarily of interest and Late Fees earned on the Receivables (including
appropriate adjustments for market discount, OID and bond premium) and any gain
realized upon the collection or disposition of Receivables. The Trust's
deductions will consist primarily of interest accruing with respect to the
Notes, servicing and other fees, and losses or deductions realized upon the
collection or disposition of Receivables.
The tax items of a partnership are allocable to the partners in accordance
with the Code, the relevant Treasury regulations promulgated thereunder and the
partnership agreement (here, the Trust Agreement and related documents).
However, inasmuch as the Trust's payment of the Certificate Rate on the
Certificates is payable to the Certificateholders without regard to the income
of the Trust, the Trust's payment of such amounts to Certificateholders should
be treated (and the Trust intends to so treat such payments) as 'guaranteed
payments' within the meaning of Section 707(c) of the Code, and not as a
distributive share of the Trust's income. Such guaranteed payments will be
considered ordinary income to a Certificateholder but may not be considered
interest income for U.S. federal income tax purposes.
In the event that such tax treatment is not respected, the Trust Agreement
provides that the Certificateholders will be allocated gross income of the Trust
for each calendar month equal to the sum of (i) the amount of interest that
accrues on the Certificates for such calendar month, (ii) an amount equivalent
to interest that accrues during such period on amounts previously due on the
Certificates but not yet distributed and (iii) any gross income of the Trust
attributable to discount on the Receivables that corresponds to any excess of
the principal amount of the Certificates over their initial issue price. All
remaining income of the Trust will be allocated to the Seller. All deductions
and losses also will be allocated to the Seller.
Based on the economic arrangement of the parties, such allocations should
be respected for U.S. federal income tax purposes. However, no assurance can be
given that the IRS would not require the Trust to allocate a greater amount of
income to the Certificateholders. Moreover, even under the foregoing method of
allocation, Certificateholders may be allocated income equal to the entire
Certificate Rate plus the other items described above, even though the Trust may
not have sufficient cash to make current cash distributions with respect to such
income. Thus, cash method Certificateholders will be required effectively to
report income from the Certificates on an accrual basis and all
Certificateholders will be liable for the U.S. federal income taxes due on their
allocable share of the Trust's income even if they have not received any cash
distributions from the Trust with respect to such income. In addition, because
tax allocations and tax reporting will be done on a uniform basis for all
Certificateholders, Certificateholders purchasing Certificates at different
times and at different prices may be required to recognize an amount of taxable
income that is greater or less than the amount reported to them by the Trust.
See 'Allocations between Transferors and Transferees' below.
The Trust intends to make all tax calculations relating to income and
allocations to Certificateholders on an aggregate basis. If the IRS were to
require that such calculations be made separately for each Receivable, the Trust
might be required to incur additional expense, but it is believed that there
would not be a material adverse effect on Certificateholders.
S-38
<PAGE>
Discount and Premium. It is anticipated that the Receivables held by the
Trust will not have been issued with OID. Therefore, the Trust should not have
to accrue any OID income. However, the purchase price paid by the Trust for the
Receivables may be greater or less than the remaining principal balance of the
Receivables at the time of purchase. If so, the Receivables will have been
acquired at a premium or discount, as the case may be. (As indicated above, the
Trust will make this calculation on an aggregate basis, but might be required to
recompute it on a Receivable-by-Receivable basis.)
If the Trust acquires the Receivables at a market discount or premium, the
Trust will elect to include any such discount in income currently as it accrues
over the life of the Receivables or to offset any such premium against interest
income on the Receivables. As indicated above, a portion of such market discount
income or premium deduction may be allocated to Certificateholders.
Section 708 Termination. Under Section 708 of the Code, the Trust will be
deemed to terminate for U.S. federal income tax purposes if 50% or more of the
capital and profits interests in the Trust are sold or exchanged within a
12-month period. If such a termination occurs, the Trust would be considered to
have transferred all of its assets and liabilities to a new Trust and then to
have immediately liquidated and distributed the interests in the new Trust to
the continuing Certificateholders. The Trust will not comply with certain
technical requirements that might apply when such a constructive termination
occurs. Consequently, the Trust may be subject to certain tax penalties and may
incur additional expenses if it is required to comply with those requirements.
Disposition of Certificates. Generally, a Certificateholder will recognize
capital gain or loss on a sale or other taxable disposition of Certificates in
an amount equal to the difference between the amount realized by the
Certificateholder on such sale or disposition and the Certificateholder's tax
basis in such Certificates. A Certificateholder's tax basis in a Certificate
generally will equal the Certificateholder's cost therefor increased by the
Certificateholder's allocable share of Trust income and decreased by any
distributions received with respect to such Certificate. In addition, both the
tax basis in the Certificates and the amount realized on a sale of a Certificate
would include the Certificateholder's allocable share of the Notes and other
liabilities of the Trust. A Certificateholder acquiring Certificates at
different prices may be required to maintain a single aggregate adjusted tax
basis in such Certificates, and, upon sale or other disposition of some of the
Certificates, allocate a portion of such aggregate tax basis to the Certificates
sold (rather than maintaining a separate tax basis in each Certificate for
purposes of computing gain or loss on a sale of that Certificate).
Any gain on the sale of a Certificate attributable to the
Certificateholder's share of unrecognized accrued market discount on the
Receivables generally would be treated as ordinary income to the
Certificateholder and would give rise to special tax reporting requirements. The
Trust does not expect to have any other assets that would give rise to such
special reporting requirements. Thus, to avoid those special reporting
requirements, the Trust will elect to include market discount in income as it
accrues.
If a Certificateholder is required to recognize an aggregate amount of
income over the life of the Certificates that exceeds the aggregate cash
distributions with respect thereto, such excess generally will give rise to a
capital loss upon the retirement of the Certificates. The deductibility of
capital losses is subject to limitations.
Allocations Between Transferors and Transferees. In general, the Trust's
taxable income and losses will be determined monthly and the tax items for a
particular calendar month will be apportioned among the Certificateholders in
proportion to the principal amount of Certificates owned by them as of the close
of the last day of such month. As a result, an investor purchasing Certificates
may be allocated tax items (which will affect its tax liability and tax basis)
attributable to periods before the actual transaction.
The use of such a monthly convention may not be permitted by existing
regulations. If a monthly convention is not allowed (or only applies to
transfers of less than all of the Certificateholder's interest), taxable income
or losses of the Trust might be reallocated among the Certificateholders. The
Owner Trustee is authorized to revise the Trust's method of allocation between
transferors and transferees to conform to a method permitted by future
regulations.
Section 754 Election. In the event that a Certificateholder sells its
Certificates at a profit (or loss), the purchasing Certificateholder will have a
higher (or lower) tax basis in the Certificates than the selling
Certificateholder had. The tax basis of the Trust's assets will not be adjusted
to reflect that higher (or lower) basis unless the Trust were to file an
election under Section 754 of the Code. In order to avoid the administrative
complexities that would be involved in keeping accurate accounting records, as
well as potentially onerous
S-39
<PAGE>
information reporting requirements, the Trust will not make such an election. As
a result, Certificateholders might be allocated a greater or lesser amount of
Trust income than would be appropriate based on their own purchase price for
Certificates.
Administrative Matters. The Owner Trustee will be required to keep
complete and accurate books for the Trust. Such books will be maintained for
financial reporting and tax purposes on an accrual basis and the fiscal year of
the Trust will be the calendar year. The Owner Trustee will file or cause to be
filed a partnership information return (IRS Form 1065) with the IRS for each
taxable year of the Trust and will report each Certificateholder's allocable
share of items of Trust income and expense to holders and the IRS on Schedule
K-1. The Owner Trustee will provide or cause to be provided the Schedule K-1
information to nominees that fail to provide the Trust with the information
statement described below and such nominees will be required to forward such
information to the beneficial owners of the Certificates. Generally,
Certificateholders must file tax returns that are consistent with the
information return filed by the Trust or be subject to penalties unless the
Certificateholder notifies the IRS of all such inconsistencies.
Under Section 6031 of the Code, any person that holds Certificates as a
nominee at any time during a calendar year is required to furnish the Trust with
a statement containing certain information on the nominee, the beneficial owners
and the Certificates so held. Such information includes (i) the name, address
and taxpayer identification number of the nominee and (ii) as to each beneficial
owner (x) the name, address and taxpayer identification number of such person
(y) whether such person is a United States person, a tax-exempt entity or a
foreign government, an international organization, or any wholly owned agency or
instrumentality of either of the foregoing, and (z) certain information on
Certificates that were held, bought or sold on behalf of such person throughout
the year. In addition, brokers and financial institutions that hold Certificates
through a nominee are required to furnish directly to the Trust information as
to themselves and their ownership of Certificates. A clearing agency registered
under Section 17A of the Exchange Act is not required to furnish any such
information statement to the Trust. The information referred to above for any
calendar year must be furnished to the Trust on or before the following January
31. Nominees, brokers and financial institutions that fail to provide the Trust
with the information described above may be subject to penalties.
The Seller will be designated as the tax matters partner in the Trust
Agreement and, as such, will be responsible for representing the
Certificateholders in any dispute with the IRS. The Code provides for
administrative examination of a partnership as if the partnership were a
separate and distinct taxpayer. Generally, the statute of limitations for
partnership items does not expire before three years after the date on which the
partnership information return is filed. Any adverse determination following an
audit of the return of the Trust by the appropriate taxing authorities could
result in an adjustment of the returns of the Certificateholders, and, under
certain circumstances, a Certificateholder may be precluded from separately
litigating a proposed adjustment to the items of the Trust. An adjustment could
result in an audit of a Certificateholder's U.S. federal income tax returns and,
consequently, to adjustments of items not related to the Certificateholder's
allocable share of the income and losses of the Trust.
Tax Consequences to Foreign Certificateholders. Under the terms of the
Trust Agreement, the Certificates may not be acquired by or for the account of
an individual or entity that is not a U.S. person as defined in Section
7701(a)(30) of the Code, and any transfer of a Certificate to a person that is
not a U.S. person shall be void. Moreover, in order to protect the Trust from
the potential adverse tax consequences that may result if the Trust failed to
withhold on amounts allocable to Foreign Investors, the Trust intends to, and
will, withhold on any amounts allocable or payable to a Foreign Investor at a
rate of 35% for Foreign Investors that are taxable as corporations and 39.6% for
all other Foreign Investors. In determining a Certificateholder's withholding
status, the U.S. entity otherwise required to withhold U.S. taxes may rely on
IRS Form W-8, IRS Form W-9 or a Certificateholder's certification of nonforeign
status signed under penalties of perjury.
Backup Withholding. Distributions made on the Certificates and proceeds
from the sale of the Certificates generally will be subject to the 31% U.S.
backup withholding tax if the Certificateholder fails to comply with certain
identification procedures or otherwise fails to establish an exemption.
S-40
<PAGE>
CERTAIN STATE TAX CONSEQUENCES
The above discussion does not address the tax treatment of the Trust, the
Notes, the Certificates, Noteholders or Certificateholders under any state tax
laws. Prospective investors are urged to consult with their own tax advisors
regarding the state tax treatment of the Trust as well as any state tax
consequences to them, particularly in the case of financial institutions, of
purchasing, holding and disposing of Notes or Certificates.
ERISA CONSIDERATIONS
THE NOTES
The Employee Retirement Income Security Act of 1974, as amended ('ERISA'),
and Section 4975 of the Code, impose certain requirements on employee benefit
plans and certain other plans and arrangements, including individual retirement
accounts and annuities, Keogh plans and certain collective investment funds or
insurance company general or separate accounts in which such plans, accounts or
arrangements are invested, that are subject to the fiduciary responsibility
provisions of ERISA and/or Section 4975 of the Code (collectively, 'PLANS'), and
on persons who are fiduciaries with respect to Plans, in connection with the
investment of 'plan assets' of any Plan ('PLAN ASSETS'). ERISA generally imposes
on Plan fiduciaries certain general fiduciary requirements, including those of
investment prudence and diversification and the requirement that a Plan's
investments be made in accordance with the documents governing the Plan.
Generally, any person who has discretionary authority or control respecting the
management or disposition of Plan Assets, and any person who provides investment
advice with respect to such assets for a fee, is a fiduciary with respect to
such Plan Assets.
Subject to the considerations described below, the Notes are eligible for
purchase with Plan Assets of any Plan.
ERISA and Section 4975 of the Code prohibit a broad range of transactions
involving Plan Assets and persons ('PARTIES IN INTEREST' under ERISA and
'DISQUALIFIED PERSONS' under the Code) who have certain specified relationships
to a Plan or its Plan Assets, unless a statutory or administrative exemption is
available. Parties in Interest or Disqualified Persons that participate in a
prohibited transaction may be subject to a penalty imposed under ERISA and/or an
excise tax imposed pursuant to Section 4975 of the Code, unless a statutory or
administrative exemption is available. These prohibited transactions generally
are set forth in Section 406 of ERISA and Section 4975 of the Code.
Any fiduciary or other Plan investor considering whether to purchase the
Notes with Plan Assets of any Plan should determine whether such purchase is
consistent with its fiduciary duties and whether such purchase would constitute
or result in a non-exempt prohibited transaction under ERISA and/or Section 4975
of the Code because any of the Seller, the Servicer, the Indenture Trustee, the
Owner Trustee, any Certificateholder or any other parties may be deemed to be
benefiting from the issuance of the Notes and may be Parties in Interest or
Disqualified Persons with respect to the investing Plan. Any fiduciary or other
Plan investor considering whether to purchase the Notes should consult with its
counsel regarding the applicability of the fiduciary responsibility and
prohibited transaction provisions of ERISA and Section 4975 of the Code to such
investment and the availability of any prohibited transaction exemption, e.g.,
U.S. Department of Labor ('DOL') Prohibited Transaction Exemptions 96-23
(relating to transactions determined by 'in-house asset managers'), 95-60
(relating to transactions involving insurance company general accounts), 91-38
(relating to transactions involving bank collective investment funds), 90-1
(relating to transactions involving insurance company pooled separate accounts)
and 84-14 (relating to transactions determined by independent 'qualified
professional asset managers'). A purchaser of the Notes should be aware,
however, that even if the conditions specified in one or more of those
exemptions are met, the scope of the exemptive relief provided by the exemption
might not cover all acts which might be construed as prohibited transactions.
In addition, under DOL Regulation Section 2510.3-101 (the 'PLAN ASSET
REGULATION'), the purchase with Plan Assets of equity interests in the Trust
could, in certain circumstances, cause the Receivables and other assets of the
Trust to be deemed Plan Assets of the investing Plan which, in turn, would
subject the Trust and its assets to the fiduciary responsibility provisions of
ERISA and the prohibited transaction provisions of ERISA and Section 4975 of the
Code. Nevertheless, because the Notes (a) should be treated as indebtedness
under local law and debt, rather than equity, for tax purposes (see 'Certain
Federal Income Tax Considerations--Tax
S-41
<PAGE>
Consequences to Noteholders--Treatment of the Notes as Indebtedness' herein),
and (b) should not be deemed to have any 'substantial equity features,'
purchases of the Notes with Plan Assets should not be treated as equity
investments and, therefore, the Receivables and other assets included as assets
of the Trust should not be deemed to be Plan Assets of the investing Plans.
Those conclusions are based, in part, upon the traditional debt features of the
Notes, including the reasonable expectation of purchasers of Notes that the
Notes (which are highly rated by the Rating Agencies) will be repaid when due,
as well as the absence of conversion rights, warrants and other typical equity
features. Before purchasing the Notes, a fiduciary or other Plan investor should
itself confirm that the Notes constitute indebtedness, and have no substantial
equity features, for purposes of the Plan Asset Regulation.
The Notes may not be purchased with Plan Assets of any Plan if any of the
Seller, the Servicer, the Indenture Trustee, the Owner Trustee or any of their
respective affiliates (a) has investment or administrative discretion with
respect to the Plan Assets used to effect such purchase; (b) has authority or
responsibility to give, or regularly gives, investment advice with respect to
such Plan Assets, for a fee and pursuant to an agreement or understanding that
such advice (1) will serve as a primary basis for investment decisions with
respect to such Plan Assets, and (2) will be based on the particular investment
needs of such Plan; or (c) is an employer maintaining or contributing to such
Plan. Each purchaser will be deemed to have represented and warranted that its
purchase of a Note or any interest therein does not violate the foregoing
limitation.
THE CERTIFICATES
Because purchases of the Certificates are equity investments, the
Certificates may not be purchased by, on behalf of or with the Plan Assets of
any Plan. In addition, each purchaser of the Certificates will be deemed to have
represented and warranted that it is neither a Plan nor purchasing the
Certificates on behalf of or with Plan Assets of a Plan.
The Small Business Job Protection Act of 1996 added new Section 401(c) of
ERISA relating to the status of the assets of insurance company general accounts
under ERISA and Section 4975 of the Code. Pursuant to Section 401(c), the
Department of Labor is required to issue final regulations (the 'GENERAL ACCOUNT
REGULATIONS') not later than December 31, 1997 with respect to insurance
policies issued on or before December 31, 1998 that are supported by an
insurer's general account. The General Account Regulations are to provide
guidance on which assets held by the insurer constitute Plan Assets for purposes
of the fiduciary responsibility provisions of ERISA and Section 4975 of the
Code. The assets of a general account that support insurance policies (other
than 'guaranteed benefit policies' within the meaning of Section 401(b)(2) of
ERISA) (i) issued to Plans after December 31, 1998 or (ii) issued to Plans on or
before December 31, 1998 for which the insurance company does not comply with
the General Account Regulations, may be treated as Plan Assets. However, except
in the case of avoidance of the General Account Regulations and actions brought
by the Secretary of Labor relating to certain breaches of fiduciary duties that
also constitute breaches of state or federal criminal law, until the date that
is 18 months after the General Account Regulations become final, no liability
under the fiduciary responsibility and prohibited transaction provisions of
ERISA and Section 4975 may result on the basis of a claim that the assets of the
general account of an insurance company constitute the Plan Assets of any Plan.
The Plan Asset status of insurance company separate accounts is unaffected by
new Section 401(c) of ERISA, and separate account assets continue to be treated
as the Plan Assets of any Plan invested in a separate account.
If the assets of a general account invested in the Certificates are treated
as Plan Assets of any Plan or the protections of Section 401(c) of ERISA become
unavailable, certain violations of the prohibited transaction rules may be
deemed to occur as a result of the operation of the Trust. Insurance companies
contemplating the investment of general account assets in the Certificates
should consult with their own counsel concerning the impact of Section 401(c) of
ERISA, including the status of assets of the general account and its ability to
continue to hold the Certificates after the date that is 18 months after the
General Account Regulations become final. The deemed representation and warranty
regarding the acquisition and holding of Certificates by any Plan or person
investing Plan Assets of any Plan (See 'Summary of Terms--ERISA Considerations'
herein) will not apply to the acquisition or holding of Certificates with the
assets of the general account of an insurance company to the extent that such
acquisition or holding, respectively, (i) is and will be permitted by Section
401(c) of ERISA and final regulations thereunder or another exemption under
ERISA and (ii) does not and will not result in the contemplated operations of
the Trust being treated as non-exempt prohibited transactions.
S-42
<PAGE>
Any fiduciary or other Plan investor considering whether to purchase any
Securities on behalf of or with Plan Assets of any Plan should consult with its
counsel and refer to this Prospectus Supplement and the Prospectus for guidance
regarding the ERISA Considerations applicable to the Securities offered hereby.
For further information see 'ERISA Considerations' in the Prospectus.
[LISTING AND GENERAL INFORMATION
Application will be made to list the Notes on the Luxembourg Stock
Exchange. In connection with the listing application, the Organization
Certificate and By-laws of the Bank, as well as legal notice relating to the
issuance of the Notes will be deposited prior to listing with the Chief
Registrar of the District Court of Luxembourg, where copies thereof may be
obtained upon request. Once the Notes have been approved for listing, trading of
the Notes may be effected on the Luxembourg Stock Exchange. The Notes have been
accepted for clearance through the facilities of DTC, Cedel and Euroclear. The
CUSIP numbers and International Securities Identification Numbers (ISIN) for the
Notes are as follows:
<TABLE>
<CAPTION>
CLASS CUSIP ISIN
- - - ------------------------------------- ------------ -----------
<S> <C> <C> <C> <C>
Class A-1............................
Class A-2............................
Class A-3............................
Class A-4............................
Class A-5............................
</TABLE>
Common Code numbers will be available upon request of any Underwriter.
The transactions contemplated in this Prospectus Supplement were authorized
by resolutions adopted by the Bank's Board of Directors as of , 199
and by the Bank's Asset and Loan Securitization Committee as of ,
199 .
Copies of the Indenture and the Transfer and Servicing Agreements, the
annual report of independent public accountants described in 'Description of the
Transfer and Servicing Agreements--Evidence as to Compliance' in the Prospectus,
the documents listed under 'Available Information' and the reports to
Securityholders referred to under 'Reports to Securityholders' and 'Certain
Information Regarding the Securities--Reports to Securityholders' in the
Prospectus will be available free of charge at the office of Banque Generale du
Luxembourg, S.A. (the 'LISTING AGENT'), 50 Avenue J.F. Kennedy, L-2951,
Luxembourg. Financial information regarding the Bank is included in the
consolidated financial statements of The Chase Manhattan Corporation in The
Chase Manhattan Corporation's Annual Report on Form 10-K for the fiscal year
ended December 31, 1996. Such report is available, and reports for subsequent
years will be available, at the office of the Listing Agent.
So long as there is no Paying Agent and Transfer Agent in Luxembourg,
Banque Generale du Luxembourg, S.A. will act as intermediary agent in
Luxembourg. In the event that Definitive Notes are issued, a Paying Agent and
Transfer Agent will be appointed in Luxembourg.
The Notes, the Indenture and Transfer and Servicing Agreements are governed
by the laws of the State of New York (except for the Trust Agreement, which is
governed by the laws of the State of Delaware).]
S-43
<PAGE>
UNDERWRITING
Subject to the terms and conditions set forth in an underwriting agreement
(the 'NOTE UNDERWRITING AGREEMENT'), the Seller has agreed to sell to the
underwriters named below (the 'NOTE UNDERWRITERS'), and each of the Note
Underwriters has severally agreed to purchase, the principal amount of Notes set
forth opposite its name below:
<TABLE>
<CAPTION>
PRINCIPAL AMOUNT PRINCIPAL AMOUNT PRINCIPAL AMOUNT PRINCIPAL AMOUNT
NOTE UNDERWRITERS OF CLASS A-1 NOTES OF CLASS A-2 NOTES OF CLASS A-3 NOTES OF CLASS A-4 NOTES
- - - ----------------------------------- ------------------ ------------------ ------------------ ------------------
<S> <C> <C> <C> <C>
------------------ ------------------ ------------------ ------------------
Total.........................
------------------ ------------------ ------------------ ------------------
------------------ ------------------ ------------------ ------------------
<CAPTION>
PRINCIPAL AMOUNT
NOTE UNDERWRITERS OF CLASS A-5 NOTES
- - - ----------------------------------- ------------------
<S> <C>
------------------
Total.........................
------------------
------------------
</TABLE>
In the Note Underwriting Agreement, the several Note Underwriters have
agreed, subject to the terms and conditions therein, to purchase all the Notes
offered hereby if any of such Notes are purchased. The Seller has been advised
by the Note Underwriters that they propose initially to offer the Class A-1
Notes, the Class A-2 Notes, the Class A-3 Notes, the Class A-4 Notes and the
Class A-5 Notes to the public at the prices set forth on the cover page hereof,
and to certain dealers at such price less a concession not in excess of %
of the principal amount of the Class A-1 Notes, % of the principal amount
of the Class A-2 Notes, % of the principal amount of the Class A-3 Notes,
% of the principal amount of the Class A-4 Notes and % of the
principal amount of the Class A-5 Notes. The Note Underwriters may allow, and
such dealers may reallow, a concession not in excess of % of the principal
amount of the Class A-1 Notes, % of the principal amount of the Class A-2
Notes, % of the principal amount of the Class A-3 Notes, % of the
principal amount of the Class A-4 Notes and % of the principal amount of
the Class A-5 Notes to certain other dealers. After the initial public offering,
such prices and such concessions may be changed.
Subject to the terms and conditions set forth in an underwriting agreement
(the 'CERTIFICATE UNDERWRITING AGREEMENT' and, together with the Note
Underwriting Agreement, the 'UNDERWRITING AGREEMENTS'), the Seller has agreed to
sell to (the 'CERTIFICATE UNDERWRITER' and, together with
the Note Underwriters, the 'UNDERWRITERS'), and has agreed
to purchase, the entire principal amount of the Certificates.
In the Certificate Underwriting Agreement, the Certificate Underwriter has
agreed, subject to the terms and conditions therein, to purchase all of the
Certificates offered hereby if any of such Certificates are purchased. The
Seller has been advised by the Certificate Underwriter that it proposes
initially to offer the Certificates to the public at the price set forth on the
cover page hereof, and to certain dealers at such price less a concession not in
excess of % of the principal amount of the Certificates. The Certificate
Underwriter may allow, and such dealers may reallow, a concession not in excess
of % of the principal amount of the Certificates to certain other dealers.
After the initial public offering, such price and such concession may be
changed.
[Each Note Underwriter has represented and agreed that (a) it has only
issued or passed on and will only issue or pass on in the United Kingdom any
document received by it in connection with the issue of the Notes to a person
who is of a kind described in Article 11(3) of the Financial Services Act 1986
(Investment Advertisements) (Exemptions) Order 1996 or who is a person to whom
the document may otherwise lawfully be issued or passed on, (b) it has complied
and will comply with all applicable provisions of the Financial Services Act
1986 with respect to anything done by it in relation to the Notes in, from or
otherwise involving the United Kingdom and (c) if that Note Underwriter is an
authorized person under Chapter III of Part I of the Financial Services Act
1986, it has only promoted and will only promote (as that term is defined in
Regulation 1.02 of the Financial Services Act 1986 (Promotion of Unregulated
Schemes) Regulations 1991) to any person in the United Kingdom the scheme
described herein if that person is of a kind described either in Section 76(2)
of the Financial
S-44
<PAGE>
Services Act 1986 or in Regulation 1.04 of the Financial Services Act 1986
(Promotion Unregulated Schemes) Regulations 1991.]
The Indenture Trustee and the Owner Trustee (on behalf of the Trust) may,
from time to time, invest the funds in the Collection Account [,the Paid-Ahead
Account] and the Reserve Account in Permitted Investments acquired from any of
the Underwriters.
, on behalf of the Note Underwriters and as
Certificate Underwriter, may engage in over-allotment transactions, stabilizing
transactions, syndicate covering transactions and penalty bids with respect to
the Securities in accordance with Regulation M under the Exchange Act.
Over-allotment transactions involve syndicate sales in excess of the offering
size, which creates a syndicate short position. Stabilizing transactions permit
bids to purchase the Security so long as the stabilizing bids do not exceed a
specified maximum. Syndicate covering transactions involve purchases of the
Securities in the open market after the distribution has been completed in order
to cover syndicate short positions. Penalty bids permit to
reclaim a selling concession from a syndicate member when the Securities
originally sold by such syndicate member are purchased in a syndicate covering
transaction. Such over-allotment transactions, stabilizing transactions,
syndicate covering transactions and penalty bids may cause the prices of the
Securities to be higher than they would otherwise be in the absence of such
transactions. Neither the Issuer nor any of the Underwriters represent that
will engage in any such transactions or that such
transactions, once commenced, will not be discontinued without notice.
[This Prospectus Supplement and the Prospectus may be used by Chase
Securities Inc., an affiliate of the Seller and a subsidiary of The Chase
Manhattan Corporation, in connection with offers and sales related to
market-making transactions in the Securities. Chase Securities Inc. may act as
principal or agent in such transactions. Such sales will be made at prices
related to prevailing market prices at the time of sale. Chase Securities Inc.
has no obligation to make a market in the Securities, and it may discontinue any
such market-making activities at any time without notice, in its sole
discretion. Chase Securities Inc. is among the Underwriters participating in the
initial distribution of the Securities.]
The Seller will indemnify the Underwriters against certain liabilities,
including liabilities under the Securities Act of 1933, as amended, or
contribute to payments the Underwriters may be required to make in respect
thereof.
LEGAL MATTERS
Certain legal matters relating to the issuance of the Securities will be
passed upon for the Seller by Simpson Thacher & Bartlett (a partnership that
includes professional corporations), New York, New York and certain other legal
matters will be passed upon for the Seller by , a
, and for the Underwriters by
Orrick, Herrington & Sutcliffe LLP, New York, New York. From time to time
Simpson Thacher & Bartlett and Orrick, Herrington & Sutcliffe LLP, provide legal
services to the Seller and its affiliates.
S-45
<PAGE>
INDEX OF TERMS
[TO BE REVISED]
<TABLE>
<CAPTION>
TERM PAGE
- - - ---------------------------------------------------------------------- --------
<S> <C>
ABS................................................................... S-17
ABS Table............................................................. S-18
[Actuarial Receivables................................................ ]
Administration Agreement.............................................. S-7
Administration Fee.................................................... S-7
Administrator......................................................... S-7
Aggregate Net Losses.................................................. S-33
Available Interest.................................................... S-30
Available Principal................................................... S-30
Available Reserve Account Amount...................................... S-33
Average Delinquency Percentage........................................ S-33
Average Net Loss Ratio................................................ S-33
Bank.................................................................. S-1
Business Day.......................................................... S-3
Cedel................................................................. i
Certificate Balance................................................... S-30
Certificate Final Scheduled Distribution Date......................... S-5
Certificate Rate...................................................... S-4
Certificate Underwriter............................................... S-44
Certificate Underwriting Agreement.................................... S-44
Certificateholder..................................................... S-35
Certificateholders.................................................... S-4
Certificateholders' Distributable Amount.............................. S-31
Certificateholders' Interest Carryover Shortfall...................... S-31
Certificateholders' Interest Distributable Amount..................... S-31
Certificateholders' Monthly Interest Distributable Amount............. S-31
Certificateholders' Monthly Principal Distributable Amount............ S-31
Certificateholders' Principal Carryover Shortfall..................... S-31
Certificateholders' Principal Distributable Amount.................... S-31
Certificates.......................................................... ii
Chase................................................................. S-11
Chase USA............................................................. S-1
Class A-1 Final Scheduled Distribution Date........................... S-4
Class A-1 Notes....................................................... ii
Class A-2 Final Scheduled Distribution Date........................... S-4
Class A-2 Notes....................................................... ii
Class A-3 Final Scheduled Distribution Date........................... S-4
Class A-3 Notes....................................................... ii
Class A-4 Final Scheduled Distribution Date........................... S-4
Class A-4 Notes....................................................... ii
Class A-5 Final Scheduled Distribution Date........................... S-4
Class A-5 Notes....................................................... ii
Closing Date.......................................................... i
Code.................................................................. S-35
Collection Account.................................................... S-6
Collection Period..................................................... S-7
Contract Rate......................................................... S-11
Cutoff Date........................................................... ii
Delinquency Percentage................................................ S-33
Direct Receivables.................................................... S-11
Disqualified Persons.................................................. S-41
</TABLE>
S-46
<PAGE>
<TABLE>
<CAPTION>
TERM PAGE
- - - ---------------------------------------------------------------------- --------
<S> <C>
Distribution Date..................................................... ii
DOL................................................................... S-41
DTC................................................................... i
ERISA................................................................. S-41
Euroclear............................................................. i
FDIC.................................................................. i
Federal Tax Counsel................................................... S-35
Final Scheduled Maturity Date......................................... S-2
Financed Vehicles..................................................... S-2
Foreign Investor...................................................... S-36
General Account Regulations........................................... S-42
Global Notes.......................................................... S-A-1
Global Securities..................................................... S-A-1
Indenture............................................................. S-1
Indenture Trustee..................................................... S-1
Interest Accrual Period............................................... S-3
Interest Rates........................................................ S-3
IRS................................................................... S-35
Issuer................................................................ S-1
Late Fees............................................................. S-29
Liquidation Proceeds.................................................. S-33
Listing Agent......................................................... S-43
Net Loss Ratio........................................................ S-33
Note Underwriters..................................................... S-44
Note Underwriting Agreement........................................... S-44
Noteholder............................................................ S-35
Noteholders........................................................... S-3
Noteholders' Distributable Amount..................................... S-31
Note Final Scheduled Distribution Date................................ S-4
Noteholders' Interest Carryover Shortfall............................. S-32
Noteholders' Interest Distributable Amount............................ S-32
Noteholders' Monthly Interest Distributable Amount.................... S-32
Noteholders' Monthly Principal Distributable Amount................... S-32
Noteholders' Principal Carryover Shortfall............................ S-32
Noteholders' Principal Distributable Amount........................... S-32
Notes................................................................. ii
Original Pool Balance................................................. S-3
Owner Trustee......................................................... S-1
Parties in Interest................................................... S-41
Paying Agent.......................................................... S-29
Plan Asset Regulation................................................. S-41
Plan Assets........................................................... S-41
Plans................................................................. S-41
Pool Balance.......................................................... S-3
Principal Distribution Amount......................................... S-32
Rating Agency......................................................... S-8
Receivables Pool...................................................... S-10
Record Date........................................................... S-3
Reserve Account....................................................... S-5
Reserve Account Initial Deposit....................................... S-5
Sale and Servicing Agreement.......................................... S-2
Securities............................................................ ii
Securityholders....................................................... S-4
</TABLE>
S-47
<PAGE>
<TABLE>
<CAPTION>
TERM PAGE
- - - ---------------------------------------------------------------------- --------
<S> <C>
Seller................................................................ i, S-1
Servicer.............................................................. ii, S-1
Servicing Fee......................................................... S-29
Servicing Fee Rate.................................................... S-29
Settlement Date....................................................... S-6
Specified Reserve Account Balance..................................... S-6
Total Distribution Amount............................................. S-30
Transfer and Servicing Agreements..................................... S-28
Trust................................................................. i, S-1
Trust Account......................................................... S-29
Trust Agreement....................................................... S-1
Underwriters.......................................................... S-44
Underwriting Agreements............................................... S-44
U.S................................................................... S-35
</TABLE>
S-48
<PAGE>
ANNEX A
GLOBAL CLEARANCE, SETTLEMENT AND
TAX DOCUMENTATION PROCEDURES
Except in certain limited circumstances, the globally offered Chase
Manhattan Auto Trust 199 - Class A-1 % Asset Backed Notes, Class A-2 %
Asset Backed Notes, Class A-3 % Asset Backed Notes, Class A-4 % Asset
Backed Notes and Class A-5 % Asset Backed Notes (the 'GLOBAL NOTES') and
% Asset Backed Certificates (the 'GLOBAL CERTIFICATES,' and together with
the Global Notes, the 'GLOBAL SECURITIES') to be issued will be available only
in book-entry form. Investors in the Global Securities may hold Global Notes
through any of DTC, Cedel or Euroclear or hold Global Certificates through DTC.
The Global Securities will be tradeable as home market instruments in both the
European and U.S. domestic markets. Initial settlement and all secondary trades
will settle in same-day funds.
Secondary market trading between investors holding Global Notes through
Cedel and Euroclear will be conducted in the ordinary way in accordance with
their normal rules and operating procedures and in accordance with conventional
eurobond practice (i.e., seven calendar day settlement).
Secondary market trading between investors holding Global Securities
through DTC will be conducted according to the rules and procedures applicable
to U.S. corporate debt obligations.
Secondary cross-market trading between Cedel or Euroclear and DTC
Participants holding Global Notes will be effected on a delivery-against-payment
basis through the respective Depositaries of Cedel and Euroclear (in such
capacity) and as DTC Participants.
Non-U.S. holders (as described below) of Global Securities will be subject
to U.S. withholding taxes unless such holders meet certain requirements and
deliver appropriate U.S. tax documents to the securities clearing corporation
organizations or their participants.
INITIAL SETTLEMENT
All Global Securities will be held in book-entry form by DTC in the name of
Cede & Co. as nominee or DTC. Investors' interests in the Global Securities will
be represented through financial institutions acting on their behalf as direct
and indirect Participants in DTC. As a result, Cedel and Euroclear will hold
positions on behalf of their participants through their respective Depositaries,
which in turn will hold such positions in accounts as DTC Participants.
Investors electing to hold their Global Securities through DTC will follow
the settlement practice applicable to U.S. corporate debt obligations. Investor
securities custody accounts will be credited with the holdings against payment
in same-day funds on the settlement date.
Investors electing to hold their Global Notes through Cedel or Euroclear
accounts will follow the settlement procedures applicable to conventional
eurobonds, except that there will be no temporary global security and no
'lock-up' or restricted period. Global Securities will be credited to the
securities custody accounts on the settlement date against payment in same-day
funds.
SECONDARY MARKET TRADING
Since the purchaser determines the place of delivery, it is important to
establish at the time of the trade where both the purchaser's and seller's
accounts are located to ensure that settlement can be made on the desired value
date.
Trading between DTC Participants. Secondary market trading between DTC
Participants will be settled using the procedures applicable to U.S. corporate
debt obligations in same-day funds.
S-A-1
<PAGE>
Trading between Cedel and/or Euroclear Participants. Secondary market
trading between Cedel Participants or Euroclear Participants will be settled
using the procedures applicable to conventional eurobonds in same-day funds.
Trading between DTC seller and Cedel or Euroclear purchaser. When Global
Notes are to be transferred from the account of a DTC Participant to the account
of a Cedel Participant or a Euroclear Participant, the purchaser will send
instructions to Cedel or Euroclear, through a Cedel Participant or Euroclear
Participant, at least one business day prior to settlement. Cedel or Euroclear
will instruct the respective Depositary to receive the Global Notes against
payment. Payment will include interest accrued on the Global Notes from and
including the last coupon payment date to and excluding the settlement date.
Payment will then be made by the respective Depositary to the DTC Participant's
account against delivery of the Global Notes. After settlement has been
completed, the Global Notes will be credited to the respective clearing system
and by the clearing system, in accordance with its usual procedures, to the
Cedel Participant's or Euroclear Participant's account. The Global Notes credit
will appear the next day (European time) and the cash debit will be
backed-valued to, and the interest on the Global Notes will accrue from, the
value date (which would be the preceding day when settlement occurred in New
York). If settlement is not completed on the intended value date (i.e., the
trade fails), the Cedel or Euroclear cash debit will be valued instead as of the
actual settlement date.
Cedel Participants and Euroclear Participants will need to make available
to the respective clearing systems the funds necessary to process same-day funds
settlement. The most direct means of doing so is to preposition funds for
settlement, either from cash on hand or existing lines of credit, as they would
for any settlement occurring within Cedel or Euroclear. Under this approach,
they may take on credit exposure to Cedel or Euroclear until the Global Notes
are credited to their accounts one day later.
As an alternative, if Cedel or Euroclear has extended a line of credit to
them, Cedel Participants or Euroclear Participants can elect not to preposition
funds and allow that credit line to be drawn upon the finance settlement. Under
this procedure, Cedel Participants or Euroclear Participants purchasing Global
Notes would incur overdraft charges for one day, assuming they cleared the
overdraft when the Global Notes were credited to their accounts. However,
interest on the Global Notes would accrue from the value date. Therefore, in
many cases the investment income on the Global Notes earned during the one-day
period may substantially reduce or offset the amount of such overdraft charges,
although this result will depend on each Cedel Participant's or Euroclear
Participant's particular cost of funds.
Since the settlement is taking place during New York business hours, DTC
Participants can employ their usual procedures for sending Global Notes to the
respective Depositary for the benefit of Cedel Participants or Euroclear
Participants. The sale proceeds will be available to the DTC seller on the
settlement date. Thus, to the DTC Participant a cross-market transaction will
settle no differently than a trade between two DTC Participants.
Trading between Cedel or Euroclear seller and DTC purchaser. Due to time
zone differences in their favor, Cedel Participants and Euroclear Participants
may employ their customary procedures for transactions in which Global Notes are
to be transferred by the respective clearing system, through the respective
Depositary, to a DTC Participant. The seller will send instructions to Cedel or
Euroclear, through a Cedel Participant or Euroclear Participant, at least one
business day prior to settlement. In these cases, Cedel or Euroclear will
instruct the respective Depositary, as appropriate, to deliver the bonds to the
DTC Participant's account against payment. Payment will include interest accrued
on the Global Notes from and including the last coupon payment date to and
excluding the settlement date. The payment will then be reflected in the account
of the Cedel Participant or Euroclear Participant the following day, and receipt
of the cash proceeds in the Cedel Participant's or Euroclear Participant's
account would be back-valued to the value date (which would be the preceding
day, when settlement occurred in New York). Should the Cedel Participant or
Euroclear Participant have a line of credit with its respective clearing system
and elect to be in debit in anticipation of receipt of the sale proceeds in its
account, the back-valuation will extinguish any overdraft charges incurred over
that one-day period. If settlement is not completed on the intended value date
(i.e., the trade fails), receipt of the cash proceeds in the Cedel Participant's
or Euroclear Participant's account would instead be valued as of the actual
settlement date.
S-A-2
<PAGE>
Finally, day traders that use Cedel or Euroclear and that purchase Global
Notes from DTC Participants for delivery to Cedel Participants or Euroclear
Participants should note that these trades would automatically fail on the sale
side unless affirmative action were taken. At least three techniques should be
readily available to eliminate this potential problem:
(a) borrowing through Cedel or Euroclear for one day (until the
purchase side of the day trade is reflected in their Cedel or Euroclear
accounts) in accordance with the clearing system's custom procedures;
(b) borrowing the Global Notes in the U.S. from a DTC Participant no
later than one day prior to settlement, which would give the Global Notes
sufficient time to be reflected in their Cedel or Euroclear account in
order to settle the sale side of the trade; or
(c) staggering the value dates for the buy and sell sides of the trade
so that the value date for the purchase from the DTC Participant is at
least one day prior to the value date for the sale to the Cedel Participant
or Euroclear Participant.
CERTAIN U.S. FEDERAL INCOME TAX DOCUMENTATION REQUIREMENTS
GLOBAL NOTES
A beneficial owner of Global Notes holding securities through Cedel or
Euroclear (or through DTC if the holder has an address outside the U.S.) will be
subject to the 30% U.S. withholding tax that generally applies to payments of
interest (including original issue discount) on registered debt issued by U.S.
Persons, unless (i) each clearing system, bank or other financial institution
that holds customers' securities in the ordinary course of its trade or business
in the chain of intermediaries between such beneficial owner and the U.S. entity
required to withhold tax complies with applicable certification requirements and
(ii) such beneficial owner takes one of the following steps to obtain an
exemption or reduced tax rate:
Exemption for non-U.S. Persons (Form W-8). Beneficial owners of the
Global Notes that are non-U.S. Persons can obtain a complete exemption from
the withholding tax by filing a signed Form W-8 (Certificate of Foreign
Status). If the information shown on Form W-8 changes, a new Form W-8 must
be filed within 30 days of such change.
Exemption for non-U.S. Persons with effectively connected income (Form
4224). A non-U.S. Person, including a non-U.S. corporation or bank with a
U.S. branch, for which the interest income is effectively connected with
its conduct of a trade or business in the United States, can obtain an
exemption from the withholding tax by filing Form 4224 (Exemption from
Withholding of Tax on Income Effectively Connected with the Conduct of a
Trade or Business in the United States).
Exemption or reduced rate for non-U.S. Persons resident in treaty
countries (Form 1001). Non-U.S. Persons that are beneficial owners of
Global Notes and who reside in a country that has a tax treaty with the
United States can obtain an exemption or reduced tax rate (depending on the
treaty terms) by filing Form 1001 (Ownership, Exemption of Reduced Rate
Certificate). If the treaty provides only for a reduced rate, withholding
tax will be imposed at that rate unless the filer alternatively files Form
W-8. Form 1001 may be filed by such beneficial owner or his agent.
Exemption for U.S. Persons (Form W-9). U.S. Persons can obtain a
complete exemption from the withholding tax by filing Form W-9 (Payer's
Request for Taxpayer Identification Number and Certification).
U.S. Federal Income Tax Reporting Procedure. The beneficial owner of
a Global Note or, in the case of a Form 1001 or a Form 4224 filer, his
agent, files by submitting the appropriate form to the person through whom
it holds (the clearing agency, in the case of persons holding directly on
the books of the
S-A-3
<PAGE>
clearing agency). Form W-8 and Form 1001 are effective for three calendar
years and Form 4224 is effective for one calendar year.
The term 'U.S. Person' means (i) a citizen or resident of the United
States, (ii) a corporation or partnership organized in or under the laws of the
United States or any political subdivision thereof, (iii) an estate the income
of which is includible in gross income for United States tax purposes regardless
of its source or (iv) a trust if a court within the United States is able to
exercise primary supervision over the administration of such trust and one or
more United States fiduciaries have the authority to control all substantial
decisions of such trust. This summary does not deal with all aspects of U.S.
federal income tax withholding that may be relevant to foreign holders of the
Global Notes. Investors are advised to consult their own tax advisors for
specific tax advice concerning their holding and disposing of the Global Notes.
GLOBAL CERTIFICATES
A beneficial owner of Global Certificates holding such Certificates through
DTC will be subject to U.S. withholding tax at a rate of 35% in the case of
corporations and at a rate of 39.6% in the case of all other persons if such
holder has an address outside of the U.S., unless (i) each clearing system, bank
or other financial institutions that hold customers' securities in the ordinary
course of its business in the chain of intermediaries between such beneficial
owner and the U.S. entity required to withhold tax complies with applicable
certification requirements and (ii) such beneficial owner certifies that it is a
U.S. Person and such certification is signed under penalties of perjury.
S-A-4
<PAGE>
[TO BE INSERTED IF NOTES ARE LISTED ON
THE LUXEMBOURG STOCK EXCHANGE]
PRINCIPAL OFFICE OF
CHASE MANHATTAN BANK USA, NATIONAL ASSOCIATION
802 Delaware Avenue
Wilmington, Delaware 19801
OWNER TRUSTEE
INDENTURE TRUSTEE
PAYING AGENT AND TRANSFER AGENT
The Chase Manhattan Bank
450 West 33rd Street
New York, New York 10036
LISTING AND INTERMEDIARY AGENT
Banque Generale du Luxembourg, S.A.
50 Avenue J.F. Kennedy
L-2951 Luxembourg
LEGAL ADVISOR TO THE SELLER
AS TO UNITED STATES LAW
Simpson Thacher & Bartlett
425 Lexington Avenue
New York, New York 10017
LEGAL ADVISOR TO THE UNDERWRITERS
AS TO UNITED STATES LAW
Orrick, Herrington & Sutcliffe LLP
666 Fifth Avenue
New York, New York 10103
INDEPENDENT ACCOUNTANTS TO THE SELLER
Price Waterhouse LLP
1177 Avenue of the Americas
New York, New York 10036
<PAGE>
------------------------------------------------------
------------------------------------------------------
NO DEALER, SALESPERSON OR OTHER PERSON HAS BEEN AUTHORIZED TO GIVE ANY
INFORMATION OR TO MAKE ANY REPRESENTATIONS NOT CONTAINED IN THIS PROSPECTUS
SUPPLEMENT AND THE PROSPECTUS AND, IF GIVEN OR MADE, SUCH INFORMATION OR
REPRESENTATIONS MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE SELLER,
THE SERVICER OR BY THE UNDERWRITERS. NEITHER THE DELIVERY OF THIS PROSPECTUS
SUPPLEMENT OR THE PROSPECTUS NOR ANY SALE MADE HEREUNDER SHALL, UNDER ANY
CIRCUMSTANCES, CREATE AN IMPLICATION THAT THERE HAS BEEN NO CHANGE IN THE
AFFAIRS OF THE SELLER, THE SERVICER OR THE RECEIVABLES SINCE THE DATE HEREOF OR
THEREOF. THIS PROSPECTUS SUPPLEMENT AND THE PROSPECTUS DO NOT CONSTITUTE AN
OFFER OR A SOLICITATION BY ANYONE IN ANY STATE IN WHICH SUCH OFFER OR
SOLICITATION IS NOT AUTHORIZED OR IN WHICH THE PERSON MAKING SUCH OFFER OR
SOLICITATION IS NOT QUALIFIED TO DO SO OR TO ANYONE TO WHOM IT IS UNLAWFUL TO
MAKE SUCH OFFER OR SOLICITATION.
- - - ------------------------------------------------------
TABLE OF CONTENTS
<TABLE>
<S> <C>
Prospectus Supplement......................................... i
Summary of Terms.............................................. S-1
Risk Factors.................................................. S-9
The Trust..................................................... S-10
The Receivables Pool.......................................... S-11
Chase USA..................................................... S-17
Use of Proceeds............................................... S-17
Weighted Average Life of the Securities....................... S-17
Description of the Notes...................................... S-26
Description of the Certificates............................... S-27
Description of the Transfer and Servicing
Agreements.................................................. S-28
Legal Investment.............................................. S-34
Certain Federal Income Tax Consequences....................... S-35
Certain State Tax Consequences................................ S-41
ERISA Considerations.......................................... S-41
Listing and General Information............................... S-43
Underwriting.................................................. S-44
Legal Matters................................................. S-45
Index of Terms................................................ S-46
Annex A....................................................... S-A-1
Prospectus.................................................... 1
Summary of Prospectus......................................... 6
Risk Factors.................................................. 13
The Trusts.................................................... 16
The Receivables Pools......................................... 17
Weighted Average Life of the Securities....................... 23
Pool Factors and Trading Information.......................... 25
Use of Proceeds............................................... 25
Chase USA..................................................... 26
Description of the Notes...................................... 26
Description of the Certificates............................... 31
Certain Information Regarding the Securities.................. 32
Description of the Transfer and Servicing
Agreements.................................................. 39
Certain Legal Aspects of the Receivables...................... 51
ERISA Considerations.......................................... 53
Plan of Distribution.......................................... 54
Ratings....................................................... 55
Legal Matters................................................. 55
Index of Terms................................................ 56
</TABLE>
UNTIL , 199 (90 DAYS AFTER THE DATE OF THIS PROSPECTUS SUPPLEMENT),
ALL DEALERS EFFECTING TRANSACTIONS IN THE SECURITIES, WHETHER OR NOT
PARTICIPATING IN THIS DISTRIBUTION, MAY BE REQUIRED TO DELIVER THIS PROSPECTUS
SUPPLEMENT AND THE PROSPECTUS. THIS DELIVERY REQUIREMENT IS IN ADDITION TO THE
OBLIGATION OF DEALERS TO DELIVER THIS PROSPECTUS SUPPLEMENT AND THE PROSPECTUS
WHEN ACTING AS UNDERWRITERS AND WITH RESPECT TO THEIR UNSOLD ALLOTMENTS OR
SUBSCRIPTIONS.
------------------------------------------------------
------------------------------------------------------
PROSPECTUS SUPPLEMENT
$
CHASE MANHATTAN AUTO
OWNER TRUST 199 -
$ % CLASS A-1
ASSET BACKED NOTES
$ % CLASS A-2
ASSET BACKED NOTES
$ % CLASS A-3
ASSET BACKED NOTES
$ % CLASS A-4
ASSET BACKED NOTES
$ % CLASS A-5
ASSET BACKED NOTES
$ %
ASSET BACKED CERTIFICATES
CHASE MANHATTAN BANK USA, NATIONAL ASSOCIATION
SELLER AND SERVICER
Underwriters of the Notes
Underwriter of the Certificates
, 199
------------------------------------------------------
------------------------------------------------------
<PAGE>
INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A
REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR MAY
OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT BECOMES
EFFECTIVE AND WITHOUT DELIVERY OF A FINAL PROSPECTUS SUPPLEMENT AND ACCOMPANYING
PROSPECTUS. THIS PROSPECTUS SUPPLEMENT AND THE ACCOMPANYING PROSPECTUS SHALL NOT
CONSTITUTE AN OFFER TO SELL OR THE SOLICITATION OF AN OFFER TO BUY NOR SHALL
THERE BE ANY SALE OF THESE SECURITIES IN ANY STATE IN WHICH SUCH OFFER,
SOLICITATION OR SALE WOULD BE UNLAWFUL PRIOR TO REGISTRATION OR QUALIFICATION
UNDER THE SECURITIES LAWS OF ANY SUCH STATE.
SUBJECT TO COMPLETION DATED, SEPTEMBER 29, 1997
PROSPECTUS SUPPLEMENT
(To Prospectus dated , 199 ) FORM C-OWNER TRUST/SENIOR NOTES
AND JUNIOR NOTES
$
CHASE MANHATTAN AUTO OWNER TRUST 199 -
$ CLASS A-1 % ASSET BACKED NOTES
$ CLASS A-2 % ASSET BACKED NOTES
$ CLASS A-3 % ASSET BACKED NOTES
$ CLASS A-4 % ASSET BACKED NOTES
$ CLASS B % ASSET BACKED NOTES
CHASE MANHATTAN BANK USA, NATIONAL ASSOCIATION
SELLER AND SERVICER
The Chase Manhattan Auto Owner Trust 199 - (the 'TRUST') will be formed pursuant
to a Trust Agreement, to be dated as of , 199 between Chase
Manhattan Bank USA, National Association (the 'SELLER') and ,
as Owner Trustee. The Trust will issue $ aggregate principal amount of
Class A-1 % Asset Backed Notes (the 'CLASS A-1 NOTES'),
(continued on the following page)
- - - --------------------------------------------------------------------------------
There currently is no secondary market for the Notes and there is no assurance
that one will develop.
The Underwriters expect, but are not obligated, to make a market in the Notes,
and there is no assurance that any such market will develop or continue.
THE NOTES REPRESENT OBLIGATIONS OF THE TRUST ONLY AND DO NOT REPRESENT
OBLIGATIONS OF OR INTERESTS IN CHASE MANHATTAN BANK USA, NATIONAL ASSOCIATION,
THE CHASE MANHATTAN BANK, OR ANY AFFILIATE THEREOF. NONE OF THE NOTES IS A
DEPOSIT AND NONE OF THE NOTES IS INSURED BY THE FEDERAL DEPOSIT INSURANCE
CORPORATION (THE 'FDIC'). THE RECEIVABLES ARE NOT INSURED OR GUARANTEED BY THE
FDIC OR ANY OTHER GOVERNMENTAL AGENCY.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS SUPPLEMENT OR THE PROSPECTUS. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
- - - --------------------------------------------------------------------------------
PROSPECTIVE INVESTORS SHOULD CONSIDER, AMONG OTHER THINGS, THE INFORMATION SET
FORTH UNDER THE HEADING 'RISK FACTORS' IN THIS PROSPECTUS SUPPLEMENT COMMENCING
ON PAGE S-8 AND COMMENCING ON PAGE 13 OF THE ACCOMPANYING PROSPECTUS.
- - - --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
UNDERWRITING DISCOUNT PROCEEDS TO THE
PRICE TO PUBLIC(1) AND COMMISSIONS SELLER(1)(2)
<S> <C> <C> <C>
PER CLASS A-1 NOTE % % %
PER CLASS A-2 NOTE % % %
PER CLASS A-3 NOTE % % %
PER CLASS A-4 NOTE % % %
PER CLASS B NOTE % % %
TOTAL $ $ $
</TABLE>
(1) Plus accrued interest, if any, from , 199 .
(2) Before deduction of expenses estimated at $ .
- - - --------------------------------------------------------------------------------
[This Prospectus Supplement may be used by Chase Securities Inc., an affiliate
of the Seller and a subsidiary of The Chase Manhattan Corporation, in connection
with offers and sales related to market-making transactions in the Notes. Chase
Securities Inc. may act as principal or agent in such transactions. Such sales
will be made at prices related to prevailing market prices at the time of sale.]
The Notes are being offered by the Underwriters, subject to prior sale, when, as
and if issued to and accepted by the Underwriters, subject to approval of
certain legal matters by counsel for the Underwriters. The Underwriters reserve
the right to reject orders in whole or in part. It is expected that the Notes
will be delivered in book-entry form, on or about , 199 (the 'CLOSING
DATE') through the facilities of The Depository Trust Company ('DTC'), Cedel
Bank, societe anonyme ('CEDEL') or the Euroclear System ('EUROCLEAR') against
payment therefor in immediately available funds.
Underwriters
THE DATE OF THIS PROSPECTUS SUPPLEMENT IS , 199 .
<PAGE>
(continued from preceding page)
$ aggregate principal amount of Class A-2 % Asset Backed Notes (the
'CLASS A-2 NOTES'), $ aggregate principal amount of Class A-3 %
Asset Backed Notes (the 'CLASS A-3 NOTES'), $ aggregate principal
amount of Class A-4 % Asset Backed Notes (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
'CLASS A NOTES') and $ aggregate principal amount of Class B % Asset
Backed Notes (the 'CLASS B NOTES' and, together with the Class A Notes, the
'NOTES') pursuant to an Indenture to be dated as of , 199 ,
between the Trust and , as Indenture Trustee. The Trust
will also issue $ aggregate principal amount of % Asset Backed
Certificates (the 'CERTIFICATES' and, together with the Notes, the
'SECURITIES'), but the Certificates are not offered hereby. The assets of the
Trust will include a pool of retail installment sales contracts and purchase
money notes and other notes secured by new and used automobiles and light-duty
trucks, certain monies received thereunder on and after , 199 (the
'CUTOFF DATE'), security interests in the vehicles financed thereby, amounts on
deposit in certain accounts and proceeds from claims on certain insurance
policies, all as more fully described herein. The Notes will be secured by the
assets of the Trust pursuant to the Indenture.
Interest on all classes of Notes will accrue at the fixed per annum
interest rates specified above. Interest on the Notes will generally be payable
on the 15th day of each month (each, a 'DISTRIBUTION DATE'), commencing
, 199 .
Principal of the Notes will be payable on each Distribution Date to the
extent described herein, except that no principal will be paid on the Class A-2
Notes until the Class A-1 Notes have been paid in full, no principal will be
paid on the Class A-3 Notes until the Class A-2 Notes have been paid in full, no
principal will be paid on the Class A-4 Notes until the Class A-3 Notes have
been paid in full and no principal will be paid on the Class B Notes until the
Class A-4 Notes have been paid in full. The rights of the Class B Noteholders
will be subordinated to the rights of the Class A Noteholders to receive
payments of interest and principal of the Class A Notes to the extent described
herein.
The Certificates will bear interest at a rate of % per annum. The rights
of the holders of record of the Certificates (the 'CERTIFICATEHOLDERS') to
receive distributions in the respect to the Certificates will be subordinated to
the right of the holders of record of the Notes (the 'NOTEHOLDERS') to receive
payments of interest and principal on the Notes to the extent described herein.
Distributions of interest and principal on the Certificates will be subordinated
to payments due on the Notes to the extent described herein.
The Class A-1 Notes will be payable in full on the
Distribution Date [(which will be with respect to the Class A-1 Notes)],
the Class A-2 Notes will be payable in full on the
Distribution Date, the Class A-3 Notes will be payable in full on the
Distribution Date, the Class A-4 Notes will be payable in
full on the Distribution Date and the Class B Notes will be
payable in full on the Distribution Date. Investors should be
aware that payment in full of a class of Class A Notes or Class B Notes could
occur earlier than such dates as described herein. The rights of holders of
record of the Class B Notes (the 'CLASS B NOTEHOLDERS') will be subordinated to
the rights of the holders of record of the Class A Notes (the 'CLASS A
NOTEHOLDERS') to receive payments of interest on and principal of the Class A
Notes to the extent described herein. In addition, the Class A-4 Notes and the
Class B Notes will be subject to prepayment in whole, but not in part, on any
Distribution Date on which Chase Manhattan Bank USA, National Association, in
its capacity as servicer (in such capacity, the 'SERVICER'), exercises its
option to purchase the Receivables. The Servicer may purchase all the
Receivables on any Distribution Date on which the Pool Balance (as defined
herein) shall have declined to 5% or less of the Original Pool Balance (as
defined herein).
The Issuer, a newly-formed limited purpose Delaware business trust,
generally will be prohibited from incurring any indebtedness other than the
Notes, and its assets will include the Receivables and related property, the
Collection Account [,the Paid-Ahead Account], the Note Distribution Account and
the Reserve Account, as described herein.
The Notes initially will be represented by Notes registered in the name of
Cede & Co., the nominee of DTC. The interests of beneficial owners of the Notes
will be represented by book entries on the records of DTC and participating
members thereof. Definitive Notes or Definitive Certificates will be available
only under the limited circumstances described herein.
[Application will be made to list the Notes on the Luxemburg Stock
Exchange.]
THIS PROSPECTUS SUPPLEMENT DOES NOT CONTAIN COMPLETE INFORMATION ABOUT THE
OFFERING OF THE NOTES. ADDITIONAL INFORMATION IS CONTAINED IN THE PROSPECTUS,
AND PROSPECTIVE INVESTORS ARE URGED TO READ BOTH THIS PROSPECTUS SUPPLEMENT AND
THE PROSPECTUS IN FULL. SALES OF THE NOTES MAY NOT BE CONSUMMATED UNLESS THE
PURCHASER HAS RECEIVED BOTH THIS PROSPECTUS SUPPLEMENT AND THE PROSPECTUS.
CERTAIN PERSONS PARTICIPATING IN THIS OFFERING MAY ENGAGE IN TRANSACTIONS
THAT STABILIZE, MAINTAIN, OR OTHERWISE AFFECT THE PRICE OF THE NOTES, INCLUDING
OVER-ALLOTMENT TRANSACTIONS, STABILIZING TRANSACTIONS, SYNDICATE COVERING
TRANSACTIONS AND PENALTY BIDS. FOR A DESCRIPTION OF THESE ACTIVITIES, SEE
'UNDERWRITING' HEREIN.
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Upon receipt of a request by an investor, or his or her representative,
within the period during which there is a prospectus delivery obligation, the
Underwriters will transmit or cause to be transmitted promptly, without charge
and in addition to any such delivery requirements, a paper copy of this
Prospectus Supplement and a Prospectus or this Prospectus Supplement and a
Prospectus encoded in an electronic format.
SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS
Certain of the matters discussed under the captions 'The Receivables
Pool--Delinquencies and Loan Loss Information' and 'Weighted Average Life of the
Securities' in this Prospectus Supplement may constitute forward-looking
statements within the meaning of Section 7A of the Securities Act, and as such
may involve known and unknown risks, uncertainties and other factors which may
cause the actual results, performance or achievements of the Receivables to be
materially different from any future results, performance or achievements
expressed or implied by such forward-looking statements.
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SUMMARY OF TERMS
This Summary of Terms is qualified in its entirety by reference to the
detailed information appearing elsewhere herein and in the Prospectus. Certain
capitalized terms used in this Summary are defined elsewhere in this Prospectus
Supplement on the pages indicated in the 'Index of Terms' or, to the extent not
defined herein, have the meanings assigned to such terms in the Prospectus.
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ISSUER........................ The Chase Manhattan Auto Owner Trust 199 - (the 'TRUST' or the 'ISSUER'), a
Delaware business trust established pursuant to a trust
agreement (as amended and supplemented, the 'TRUST AGREEMENT'), dated as
of , 199 between the Seller and the Owner Trustee.
SELLER........................ Chase Manhattan Bank USA, National Association ('CHASE USA'), a national banking
association headquartered in Delaware and a wholly-owned subsidiary of The Chase
Manhattan Corporation (in such capacity, the 'SELLER,' or individually, the
'BANK').
SERVICER...................... Chase USA (in such capacity, the 'SERVICER').
INDENTURE TRUSTEE............. , as trustee under the Indenture (the 'INDENTURE TRUSTEE').
The Indenture Trustee's Corporate Trust Office is located at ,
telephone . The Bank and its affiliates may have normal banking
relationships with the Indenture Trustee and its affiliates.
OWNER TRUSTEE................. , as trustee under the Trust Agreement (the 'OWNER TRUSTEE').
The Owner Trustee's Corporate Trust Office is located at ,
telephone . The Bank and its affiliates may have
normal banking relationships with the Owner Trustee and its affiliates.
THE NOTES..................... Class A-1 % Asset Backed Notes in the aggregate principal amount of $ .
Class A-2 % Asset Backed Notes in the aggregate principal amount of $ .
Class A-3 % Asset Backed Notes in the aggregate principal amount of $ .
Class A-4 % Asset Backed Notes in the aggregate principal amount of $ .
Class B % Asset Backed Notes in the aggregate principal amount of $ .
The rights of Class B Noteholders to receive distributions with respect to the
Class B Notes will be subordinated to the rights of the Class A Noteholders to
receive distributions with respect to the Class A Notes to the extent described
herein.
The Notes will be issued by the Trust pursuant to an Indenture to be dated as of
, 199 (the 'INDENTURE'), between the Trust and the Indenture
Trustee. The Notes will be secured by the assets of the Trust.
The Notes will be available for purchase in book-entry form only in minimum
denominations of $1,000 and integral multiples thereof. The Noteholders will not
be entitled to receive Definitive Notes, except in the limited circumstances
described in the Prospectus. Noteholders may elect to hold their Notes through
DTC (in the United States) or Cedel or Euroclear (in Europe). All references
herein to Noteholders shall reflect the rights of Noteholders, as such rights may
be exercised through DTC and its Participants (including Cedel and Euroclear),
except as otherwise specified herein and in the Prospectus. See 'Description of
the Notes--General' and 'Certain Information Regarding the Securities--
Book-Entry Registration' in the Prospectus.
THE TRUST..................... The Trust is a business trust established under the laws of Delaware pursuant to
the Trust Agreement. The activities of the Trust are limited by the terms of the
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Trust Agreement to acquiring, owning and managing the Receivables, issuing and
making payments on the Notes and Certificates and other activities related
thereto. The assets of the Trust will include (i) the Receivables, (ii) all
monies received thereunder on and after the Cutoff Date, (iii) such amounts as
from time to time may be held in one or more Trust Accounts established and
maintained pursuant to the Sale and Servicing Agreement, as described herein,
(iv) security interests in the Financed Vehicles, (v) the Seller's proceeds from
the exercise of the Seller's recourse rights against Dealers, (vi) proceeds from
claims on certain insurance policies, (vii) rights with respect to repossessed
Financed Vehicles, and (viii) any and all proceeds of the foregoing.
In addition to the Notes, the Trust will also issue % Asset Backed Certificates
(the 'CERTIFICATES') in the aggregate principal amount of $ . The Seller
will initially purchase the entire principal amount of the Certificates. The
Certificates will bear interest at the rate of % per annum (the 'CERTIFICATE
RATE'). The rights of the Certificateholders to receive distributions with
respect to the Certificates will be subordinated to the rights of the Noteholders
to receive distributions with respect to the Notes to the extent described
herein. The Certificates represent fractional undivided interests in the Trust
(subject to the rights of the Noteholders as described herein) and will be issued
pursuant to the Trust Agreement. The Certificates are not offered hereby.
THE RECEIVABLES............... The Receivables will consist of retail installment sales contracts and purchase
money notes and other notes secured by new and used automobiles and light-duty
trucks (the 'FINANCED VEHICLES'). On the Closing Date, the Seller will transfer
Receivables having an aggregate principal balance of approximately $ as
of the Cutoff Date to the Trust in exchange for the Securities pursuant to a Sale
and Servicing Agreement to be dated as of , 199 (as amended and
supplemented from time to time, the 'SALE AND SERVICING AGREEMENT'), among the
Trust, the Seller and the Servicer. See 'Description of the Transfer and
Servicing Agreements' herein and in the Prospectus.
The Receivables have been selected from the contracts owned by the Bank based on
the criteria specified in the Sale and Servicing Agreement and described herein
and in the Prospectus. See 'The Receivables Pool' herein and 'The Receivables
Pools' in the Prospectus. No Receivable will have a scheduled maturity that,
after giving prospective effect to any permitted extensions or deferrals, would
be later than , (the 'FINAL SCHEDULED MATURITY DATE'). As of the
Cutoff Date, the weighted average remaining maturity of the Receivables was
approximately months and the weighted average original maturity of the
Receivables was approximately months. As of the Cutoff Date, approximately
% of the Original Pool Balance were secured by used Financed Vehicles and the
remainder were secured by new Financed Vehicles.
The 'POOL BALANCE' at any time will represent the aggregate principal balance of
the Receivables as of the close of business on the last day of the preceding
Collection Period, after giving effect to all payments received from Obligors and
Repurchase Amounts to be remitted by the Servicer or the Seller, as the case may
be, for such Collection Period and all losses realized on Receivables liquidated
during such Collection Period. The aggregate principal balance of the Receivables
as of the Cutoff Date (the 'ORIGINAL POOL BALANCE') was $ .
TERMS OF THE NOTES............ The principal terms of the Notes are described below:
Distribution Dates. Payments of interest and principal on the Notes will be made
on the 15th day of each month or, if any such day is not a Business Day, on the
next succeeding Business Day, commencing , 199 [;
provided, however, that for purposes of making payment of interest and the final
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payment of principal on the Class A-1 Notes, the Distribution Date with respect
to the Class A-1 Notes will be , 199 ]. A 'BUSINESS DAY' is a day on
which banks located in New York, New York, Wilmington, Delaware and are
open for the purpose of conducting a commercial banking business. Payments will
be made to the Noteholders as of the day immediately preceding such Distribution
Date or, if Definitive Notes are issued, as of the last day of the preceding
calendar month (a 'RECORD DATE').
Interest Rates. The Class A-1 Notes will bear interest at the rate of % per
annum, the Class A-2 Notes will bear interest at the rate of % per annum, the
Class A-3 Notes will bear interest at the rate of % per annum, the Class A-4
Notes will bear interest at the rate of % per annum and the Class B Notes will
bear interest at the rate of % per annum. The interest rates for all classes
of Notes are referred to herein collectively as 'INTEREST RATES.'
Interest. Interest on the outstanding principal amount of the Notes of each
class will accrue at the related Interest Rate from and including the Closing
Date (in the case of the first Distribution Date) or from and including the most
recent Distribution Date on which interest has been paid to but excluding the
following Distribution Date (each an 'INTEREST ACCRUAL PERIOD'). On each
Distribution Date, the Indenture Trustee will distribute pro rata to the
Noteholders of each class accrued interest at the related Interest Rate on the
outstanding principal balance generally to the extent of funds available therefor
as described herein. Interest on the Class B Notes will not be paid on any
Distribution Date until all accrued and unpaid interest on the Class A Notes has
been paid in full. In addition, if an Event of Default has occurred and the Notes
have been accelerated, the Class B Noteholders will not be entitled to any
payment of interest on or principal of the Class B Notes until the Class A Notes
have been paid in full. See 'Description of the Transfer and Servicing
Agreements-- Distributions' herein. Interest on the Class A-1 Notes will be
calculated on the basis of a 360-day year based upon the actual number of days
elapsed during the related Interest Accrual Period [(which will be days
with respect to the Interest Accrual Period for the Distribution
Date)]. Interest on the Class A-2 Notes, Class A-3 Notes, Class A-4 Notes and
Class B Notes will be calculated on the basis of a 360-day year consisting of
twelve 30-day months. Interest on the Notes of any class for any Distribution
Date due but not paid on such Distribution Date will be due on the next
Distribution Date in addition to an amount equal to interest on such amount at
the respective Interest Rate (to the extent lawful). See 'Description of the
Notes--Payments of Interest' and 'Description of the Transfer and Servicing
Agreements--Distributions' herein.
Principal. Principal of the Notes will be payable on each Distribution Date in
an amount equal to the Noteholders' Principal Distributable Amount for such
Distribution Date, to the extent of funds available therefor as described herein.
The Noteholders' Principal Distributable Amount for a Distribution Date will
equal 100% of the Principal Distributable Amount for such Distribution Date until
the Notes have been paid in full and will be calculated by the Servicer in the
manner described under 'Description of the Transfer and Servicing
Agreements--Distributions.'
No principal payments will be made on the Class A-2 Notes until the Class A-1
Notes have been paid in full, no principal payments will be made on the Class A-3
Notes until the Class A-2 Notes have been paid in full, no principal payments
will be made on the Class A-4 Notes until the Class A-3 Notes have been paid in
full and no principal payments will be made on the Class B Notes until the Class
A-4 Notes have been paid in full.
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No principal will be paid with respect to the Certificates until the Notes have
been paid in full.
The outstanding principal amount of the Class A-1 Notes, to the extent not
previously paid, will be payable on the Distribution Date [(which will
be with respect to the Class A-1 Notes)] (the 'CLASS A-1 FINAL
SCHEDULED DISTRIBUTION DATE'), the outstanding principal amount of the Class A-2
Notes, to the extent not previously paid, will be payable on the
Distribution Date (the 'CLASS A-2 FINAL SCHEDULED DISTRIBUTION DATE'), the
outstanding principal amount of the Class A-3 Notes, to the extent not previously
paid, will be payable on the Distribution Date (the 'CLASS A-3 FINAL
SCHEDULED DISTRIBUTION DATE'), the outstanding principal amount of the Class A-4
Notes, to the extent not previously paid, will be payable on the
Distribution Date (the 'CLASS A-4 FINAL SCHEDULED DISTRIBUTION DATE') and the
outstanding principal amount of the Class B Notes, to the extent not previously
paid, will be payable in full on the Distribution Date (the 'CLASS B
FINAL SCHEDULED DISTRIBUTION DATE' and, together with the Class A-1 Final
Scheduled Distribution Date, the Class A-2 Final Scheduled Distribution Date, the
Class A-3 Final Scheduled Distribution Date and the Class A-4 Final Scheduled
Distribution Date, each a 'FINAL SCHEDULED DISTRIBUTION DATE'), in each case from
funds available therefor as described herein (including amounts on deposit in the
Reserve Account).
Optional Redemption. After the Class A-1 Notes, Class A-2 Notes and Class A-3
Notes have been paid in full, the Class A-4 Notes and the Class B Notes will be
redeemed in whole, but not in part, on any Distribution Date on which the
Servicer exercises its option to purchase the Receivables, which can occur
following the last day of any Collection Period as of which the Pool Balance
declines to 5% or less of the Original Pool Balance, at a redemption price equal
to the unpaid principal amount of the Class A-4 Notes or the Class B Notes, as
the case may be, plus accrued and unpaid interest thereon. See 'Description of
the Notes--Optional Redemption' herein.
Limited Rights. If an Event of Default occurs under the Indenture, except as
described herein, the Class B Noteholders will not have any right to direct or to
consent to any remedies therefor by the Indenture Trustee, including the sale of
Receivables, until the Class A Notes have been paid in full, and if an Event of
Servicing Termination occurs, the Class B Noteholders will not have any right to
direct or consent to removal of the Servicer or waiver of any Event of Servicing
Termination until the Class A Notes have been paid in full. See 'Risk
Factors--Rights of Noteholders and Certificateholders,' 'Description of the
Notes--Indenture--Events of Default; Rights upon an Event of Default' and
'Description of the Transfer and Servicing Agreements--Rights Upon Event of
Servicing Termination' and '--Waiver of Past Defaults' herein.
RESERVE ACCOUNT............... A reserve account (the 'RESERVE ACCOUNT') will be pledged by the Trust to the
Indenture Trustee as collateral for the Notes. The Reserve Account will be funded
with an initial deposit by the Seller of cash or Permitted Investments having an
aggregate value of $ ( % of the Original Pool Balance) (the 'RESERVE
ACCOUNT INITIAL DEPOSIT'). In addition, on each Distribution Date, any amounts on
deposit in the Collection Account with respect to the preceding Collection Period
after payments to the Servicer and the Administrator and deposits to the Note
Distribution Account and Certificate Distribution Account have been made will be
deposited into the Reserve Account. On each Distribution Date, any amounts on
deposit in the Reserve Account in excess of the Specified Reserve Account Balance
will be distributed to the Seller.
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On or prior to each Deposit Date, the Indenture Trustee will withdraw funds from
the Reserve Account, to the extent of the funds therein, to the extent (x) the
sum of the amounts required to be distributed to Noteholders, the Servicer and
the Administrator on the related Distribution Date exceeds (y) the Total
Distribution Amount for such Distribution Date. If the amount in the Reserve
Account is reduced to zero and to the extent the subordination of amounts
distributable to Certificateholders is insufficient, Noteholders will bear the
credit and other risks associated with ownership of the Receivables, including
the risk that the Trust may not have a perfected security interest in the
Financed Vehicles. See 'Description of the Transfer and Servicing Agreements--
Subordination of Class B Noteholders; The Reserve Account' herein and 'Certain
Legal Aspects of the Receivables' in the Prospectus.
SPECIFIED RESERVE
ACCOUNT BALANCE............. On any Distribution Date, the specified reserve account balance (the 'SPECIFIED
RESERVE ACCOUNT BALANCE') will equal % ( % under certain circumstances
described herein) of the Pool Balance as of the related Settlement Date, but in
any event not less than the lesser of (i) $ ( % of the Original Pool
Balance) and (ii) the sum of (A) such Pool Balance and (B) an amount sufficient
to pay interest on each class of Notes through its related Final Scheduled
Distribution Date, in each case, at a rate equal to the sum of the related
Interest Rate plus the Servicing Fee Rate. The Specified Reserve Account Balance
with respect to any Distribution Date may be reduced to a lesser amount as
determined by the Seller, provided that such reduction does not adversely affect
the rating of any class of Notes by a Rating Agency.
COLLECTION ACCOUNT;
PRIORITY OF PAYMENTS........ The Servicer will be required to cause all collections and other amounts
constituting the Total Distribution Amount to be deposited into one or more
accounts in the name of the Indenture Trustee (collectively, the 'COLLECTION
ACCOUNT') on each Deposit Date, net of any amounts due the Seller and the
Servicer to the extent described in 'Description of the Transfer and Servicing
Agreement--Net Deposits' in the Prospectus, except upon the occurrence of certain
conditions described in 'Description of the Transfer and Servicing
Agreement--Collections' in the Prospectus. Pursuant to the Sale and Servicing
Agreement, the Servicer will have the revocable power to instruct the Indenture
Trustee or the Paying Agent to withdraw funds on deposit in the Collection
Account and to apply such funds on each Distribution Date to the following (in
the priority indicated): (i) the Servicing Fee, together with any unpaid
Servicing Fees from prior Distribution Dates (if not deducted from the Servicer's
remittance as described herein), (ii) the Administration Fee, together with any
unpaid Administration Fees from prior Distribution Dates, (iii) the Class A
Noteholders' Interest Distributable Amount into the Note Distribution Account,
(iv) the Class B Noteholders' Interest Distributable Amount into the Note
Distribution Account, (v) the Noteholders' Principal Distributable Amount into
the Note Distribution Account, and (vi) the Certificateholders' Interest
Distributable Amount into the Certificate Distribution Account.
[PAID-AHEAD ACCOUNT........... Early payments by or on behalf of Obligors on Actuarial Receivables which do not
constitute scheduled payments, full prepayments or certain partial prepayments
that result in a reduction of an Obligor's periodic payment below the scheduled
payment as of the Cutoff Date will be deposited into the Paid-Ahead Account until
such time as the paid-ahead payment falls due. See 'Description of the Transfer
and Servicing Agreements--Paid-Ahead Actuarial Receivables' herein.]
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SERVICING FEE................. The Servicer shall receive a Servicing Fee for each Collection Period, payable on
each Distribution Date, in an amount equal to the sum of (i) the product of
one-twelfth of the Servicing Fee Rate and the Pool Balance as of the close of
business on the last day of the second Collection Period preceding the
Collection Period in which such Distribution Date occurs (the 'SETTLEMENT DATE')
and (ii) any Late Fees paid by the Obligors during the related Collection Period.
A 'COLLECTION PERIOD' with respect to a Distribution Date will be the calendar
month preceding the calendar month in which such Distribution Date occurs. In
addition, the Servicing Fee will include Investment Earnings on amounts on
deposit in the Collection Account [and the Paid-Ahead Account]. See 'Description
of the Transfer and Servicing Agreements--Servicing Compensation and Payment of
Expenses' herein and 'Description of the Transfer and Servicing
Agreements--Servicing Compensation and Payment of Expenses' and '--Net Deposits'
in the Prospectus.
ADMINISTRATION
AGREEMENT................... The Chase Manhattan Bank, in its capacity as administrator (the 'ADMINISTRATOR'),
will enter into an agreement (the 'ADMINISTRATION AGREEMENT') with the Trust and
the Indenture Trustee. As compensation for the performance of the Administrator's
obligations under the Administration Agreement, the Administrator will be
entitled to a monthly administration fee in an amount equal to $ (the
'ADMINISTRATION FEE'). Chase USA has agreed to perform certain of the duties of
the Administrator set forth in the Administration Agreement and to reimburse and
indemnify the Administrator for all expenses or liabilities the Administrator may
incur as a result of its entering into the Administration Agreement. See
'Description of the Transfer and Servicing Agreements--Administration Agreement'
herein.
TAX STATUS.................... Upon issuance of the Securities, Simpson Thacher & Bartlett, special counsel to
the Seller, will deliver its opinion generally to the effect that under current
law 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 for United States federal income tax purposes. Each Noteholder, by
the acceptance of a Note, will agree to treat the Notes as indebtedness for all
federal, state and local income tax purposes. See 'Certain Federal Income Tax
Consequences' and 'Certain State Tax Consequences' herein.
[LEGAL INVESTMENT............. The Class A-1 Notes will be eligible securities for purchase by money market
funds under paragraph (a)(9) of Rule 2a-7 under the Investment Company Act of
1940, as amended.]
ERISA CONSIDERATIONS.......... Subject to the considerations described in 'ERISA Considerations' herein and in
the Prospectus, the Notes are eligible for purchase with Plan Assets of any Plan.
A fiduciary or other person contemplating purchasing the Notes on behalf of or
with Plan Assets of any Plan should carefully review with its legal advisors
whether the purchase or holding of the Notes could give rise to a transaction
prohibited or not otherwise permissible under ERISA or Section 4975 of the Code.
RATINGS OF THE NOTES.......... It is a condition to the issuance of the Notes that the Class A-1 Notes be rated
in the highest short-term rating category, that the Class A-2, Class A-3 and
Class A-4 Notes be rated at least in the ' ' category and that the Class B
Notes be rated at least in the ' ' category (or its equivalent), in each case
by at least two nationally recognized statistical rating organizations (each, a
'RATING AGENCY'). There can be no assurance that any of these ratings will not be
lowered or withdrawn if, in the sole judgment of the related Rating Agency,
circumstances in the future so warrant. See 'Risk Factors--Ratings of the Notes'
herein.
[LISTING...................... Application will be made to list the Notes on the Luxemburg Stock Exchange.]
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RISK FACTORS
Investors should consider, among other things, the matters discussed under
'Risk Factors' in the Prospectus and the following risk factors in connection
with purchases of the Notes.
LIMITED LIQUIDITY
There is currently no secondary market for the Notes offered hereby. The
Underwriters currently intend to make a market in the Notes offered hereby, but
none of them are under any obligation to do so. There can be no assurance that a
secondary market will develop or, if a secondary market does develop, that it
will provide the Noteholders with liquidity of investment or that it will
continue for the life of the Notes offered hereby.
TRUST'S RELATIONSHIP TO THE SELLER AND THE SERVICER
Neither the Seller nor the Servicer is generally obligated to make any
payments in respect of the Notes or the Receivables. In addition, if the Bank
were to cease acting as Servicer, delays in processing payments on the
Receivables and information in respect thereof could occur and result in delays
in payments to the Noteholders. See 'Description of the Transfer and Servicing
Agreements--Sale and Assignment of Receivables' in the Prospectus.
SUBORDINATION; LIMITED ASSETS
Payment of interest on the Class B Notes will be subordinated to payment of
interest on the Class A Notes. In addition, the Class B Noteholders will not
receive any payment of principal until the Class A Notes have been paid in
full. See 'Description of the Transfer and Servicing Agreements--Distributions'
herein.
The Trust will not have, nor is it permitted or expected to have, any
significant assets or sources of funds other than the Receivables and the
amounts on deposit in the Reserve Account. Holders of the Notes must rely for
repayment upon payments on the Receivables and, if and to the extent available
on each Distribution Date to cover shortfalls in distributions of interest and
principal on the Notes, amounts on deposit in the Reserve Account. However,
funds deposited in the Reserve Account are limited in amount, and the amount
required to be maintained on deposit in the Reserve Account will be reduced as
the Pool Balance declines. If the amount on deposit in the Reserve Account is
exhausted, and, to the extent the subordination of amounts distributable to
Class B Noteholders and the Certificateholders is insufficient, the Trust will
depend solely on current distributions on the Receivables to make payments on
the Notes. The Notes will not be insured or guaranteed by the Bank, the
Servicer, the Owner Trustee, the Indenture Trustee or any affiliate thereof.
[RIGHTS OF CLASS B NOTEHOLDERS
If an Event of Default under the Indenture occurs and the maturity of the
Notes is accelerated, the Indenture Trustee will have the right or be required
in certain circumstances to sell the Receivables to pay the principal of, and
accrued interest on, the Notes. Upon the occurrence of an Event of Default,
except as described herein, the Class B Noteholders will not have any right to
direct or to consent to any actions by the Indenture Trustee until the Class A
Noteholders have been paid in full. There is no assurance that the proceeds of
such sale will be equal to or greater than the aggregate outstanding principal
amount of the Notes plus, in each case, accrued interest thereon. Because
neither interest nor principal is distributed to Class B Noteholders following
an Event of Default and acceleration of the Notes until the Class A Notes have
been paid in full, the interests of the Class B Noteholders and the Class A
Noteholders may conflict, and the exercise by the Indenture Trustee of its right
to sell the Receivables or exercise other remedies may cause the Class B
Noteholders to suffer a loss of all or part of their investment. See
'Description of the Notes--The Indenture--Events of Default; Rights upon an
Event of Default' herein.
In the event that an Event of Servicing Termination occurs, the Indenture
Trustee or the Class A Noteholders evidencing not less than a majority of the
aggregate principal amount of the Class A Notes then outstanding, as described
under 'Description of the Transfer and Servicing Agreements--Rights upon an
Event of Servicing Termination' herein, may remove the Servicer without consent
of any of the Class B Noteholders. None of the Class B Noteholders will have the
ability, with certain specified exceptions, to waive defaults by the
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Servicer, including defaults that could materially adversely affect the Class B
Noteholders. See 'Description of the Transfer and Servicing Agreement--Waiver of
Past Events of Servicing Termination' herein.]
RATINGS OF THE NOTES
It is a condition to the issuance of the Notes that the Class A-1 Notes be
rated in the highest short-term rating category and that the Class A-2, Class
A-3 and Class A-4 Notes be rated at least in the ' ' category, and that the
Class B Notes be rated at least in the ' ' category, or its equivalent, in
each case by at least two Rating Agencies. A rating is not a recommendation to
purchase, hold or sell Notes, inasmuch as such rating does not comment as to
market price or suitability for a particular investor. The ratings of the Notes
address the likelihood of the timely payment of interest on and ultimate payment
of principal of the Notes pursuant to their terms. There can be no assurance
that a rating will remain for any given period of time or that a rating will not
be lowered or withdrawn entirely by the related Rating Agency if in its judgment
circumstances in the future so warrant.
THE TRUST
GENERAL
The Issuer, Chase Manhattan Bank Auto Owner Trust 199 - , is a business
trust formed under the laws of the State of Delaware pursuant to the Trust
Agreement for the transaction described in this Prospectus Supplement. The
activities of the Trust are limited by the terms of the Trust Agreement to (i)
acquiring, holding and managing the Receivables and the other assets of the
Trust and proceeds therefor, (ii) issuing the Notes and the Certificates to
finance such assets, (iii) making payments on the Notes and the Certificates
issued by it, and (iv) engaging in other activities that are necessary, suitable
or convenient to accomplish the foregoing or are incidental thereto or connected
therewith. The Trust will not acquire any contracts or assets other than the
Trust property described below and will not have any need for additional capital
resources. As the Trust does not have any operating history and will not engage
in any activity other than acquiring and holding the Receivables, issuing the
Notes and the Certificates and making distributions thereon, there has not been
included any historical or pro forma financial statements or ratio of earnings
to fixed charges with respect to the Trust. Inasmuch as the Trust has no
operating history, it is not possible to predict the operating performance of
the Trust while the Notes are outstanding. While management of the Seller
believes that the loss and delinquency experience contained herein for recent
periods are representative of past performance of Motor Vehicle Loans in the
Chase Auto Finance Portfolio, there is no assurance that such performance is
indicative of the future performance of the Receivables, since future
performance is dependent, among other things, on general economic conditions and
economic conditions in the geographical areas in which the Obligors reside
including, for example, unemployment rates.
The Certificate Balance represents the equity in the Trust. The Notes and
the Certificates will be transferred to the Seller by the Trust in exchange for
the Receivables pursuant to the Sale and Servicing Agreement.
The Trust property will include a pool (the 'RECEIVABLES POOL') comprised
of the Receivables and all monies received thereunder on and after the Cutoff
Date. The Trust property will also include: (i) such amounts as from time to
time may be held in one or more Trust Accounts established and maintained
pursuant to the Sale and Servicing Agreement, as described herein; (ii) security
interests in the Financed Vehicles; (iii) proceeds from the exercise of the
Seller's recourse rights against Dealers (as described in the Prospectus under
'The Receivables Pools--Origination and Servicing of Motor Vehicle Loans'); (iv)
proceeds from claims on theft and physical damage, credit life and credit
disability insurance policies covering the Financed Vehicles or the Obligors, as
the case may be, to the extent that such insurance policies relate to the
Receivables; (v) rights with respect to any repossessed Financed Vehicles and
(vi) any and all proceeds of the foregoing. The Sale and Servicing Agreement
sets forth criteria that must be satisfied by each Receivable. See 'Description
of the Transfer and Servicing Agreements--Sale and Assignment of Receivables' in
the Prospectus. Each Receivable will be identified in a schedule appearing as an
exhibit to the Sale and Servicing Agreement.
If the protection provided to the investment of the Class A Noteholders in
the Trust by the subordination of the amounts distributable to Class B
Noteholders and the Certificateholders, the protection provided to the
S-8
<PAGE>
Class B Noteholders in the Trust by the subordination of amounts distributable
to the Certificateholders, and the protection provided to the Noteholders by the
Reserve Account is insufficient, the Trust will look only to the Obligors on the
Receivables and the proceeds from the repossession and sale of Financed Vehicles
that secure Defaulted Receivables. In such event, certain factors, such as the
Trust's not having a first priority perfected security interest in some of the
Financed Vehicles, may affect the Trust's ability to realize on the collateral
securing the Receivables, and thus may reduce the proceeds to be distributed to
Noteholders with respect to the Notes. See 'Description of the Transfer and
Servicing Agreements--Distributions' and '--Subordination of Class B
Noteholders; Reserve Account' herein and 'Certain Legal Aspects of the
Receivables' in the Prospectus.
The Trust's principal offices are in Delaware at the address listed below
under '--The Owner Trustee.'
CAPITALIZATION OF THE TRUST
The following table illustrates the capitalization of the Trust as of the
Cutoff Date, as if the issuance and sale of the Notes and the Certificates have
taken place on such date:
<TABLE>
<S> <C>
Class A-1 Notes........................................... $
Class A-2 Notes...........................................
Class A-3 Notes...........................................
Class A-4 Notes...........................................
Class B Notes.............................................
Certificates..............................................
------------
Total................................................... $
------------
------------
</TABLE>
The Certificates will be issued pursuant to the Trust Agreement. The Seller
will initially purchase the entire principal amount of the Certificates, and the
Certificates are not offered hereby. The Certificates will bear interest at the
rate of % per annum. The rights of the Certificateholders to receive
distributions with respect to the Certificates will be subordinated to the
rights of the Noteholders to receive payments on to the Notes to the extent
described herein.
Distributions of interest and principal on the Certificates will be
subordinate to payment of interest and principal due on the Notes to the extent
described herein. Funds on deposit in the Reserve Account will not be available
to cover distributions with respect to the Certificates.
THE OWNER TRUSTEE
is the Owner Trustee under the Trust Agreement.
is a corporation and its
principal offices are located at . The Seller and its
affiliates may maintain normal commercial banking relations with the Owner
Trustee and its affiliates.
THE RECEIVABLES POOL
The Receivables represent Motor Vehicle Loans from the portfolio of the
Seller that, in addition to satisfying the criteria set forth in the Prospectus
under 'The Receivables Pools--General':
(a) have a remaining maturity, as of the Cutoff Date, of at least
months and not more than months;
(b) are secured by either new Financed Vehicles that had an original
maturity of at least months and not more than months or by used
Financed Vehicles that had an original maturity of at least months and
not more than months;
(c) are fully-amortizing fixed rate simple interest [or actuarial]
contracts that provide for level scheduled monthly payments over their
respective remaining terms and have an annual contract rate of interest (a
'CONTRACT RATE') of at least % and not more than %;
S-9
<PAGE>
(d) have remaining principal balances, as of the Cutoff Date, of at
least $ and not greater than $ ;
(e) have no payment that is delinquent for more than 30 days past due
as of the Cutoff Date; and
(f) are not Motor Vehicle Loans (i) whose related Obligor resides in
the State of Alabama (in the case of Direct Receivables) or (ii) originated
by or through a Dealer located in the State of Alabama (in the case of
Receivables which are not Direct Receivables) or Motor Vehicle Loans the
subject of a previous securitization.
The Receivables were selected from the Motor Vehicle Loans in the
portfolio of the Seller that met the above criteria. For administrative reasons,
the Seller selected from the Motor Vehicle Loans in its portfolio all otherwise
eligible Motor Vehicle Loans originated since , 199 , which were
segregated and held for sale by the Seller. The Seller believes that such
selection procedures are not materially adverse to Noteholders. Approximately %
of the Original Pool Balance were secured by new Financed Vehicles and
approximately % of the Original Pool Balance were secured by used Financed
Vehicles. [All of the Receivables are Simple Interest Receivables.] [ % of
the Original Pool Balance were Simple Interest Receivables and % of the
Original Pool Balance were Actuaual Receivables.] An insignificant number of the
Receivables provide for recourse to the Dealer in the event of default by the
Obligor.
Approximately % of the Original Pool Balance were made directly by the
Originating Bank to Obligers without involvement of Dealers (collectively, the
'DIRECT RECEIVABLES') using the Chase Auto Finance underwriting criteria and
have been serviced consistent with Chase Auto Finance's servicing policies and
practices. The Direct Receivables originated directly by Chase, as Originating
Bank, will be transferred to the Seller prior to the Closing Date.
The Seller may not substitute other Motor Vehicle Loans from its portfolio,
or any other motor vehicle receivables, for the Receivables at any time during
the term of the Sale and Servicing Agreement. See 'The Receivables
Pools--General' and 'Weighted Average Life of the Securities' in the Prospectus
for a description of how prepayments made under Simple Interest Receivables [and
Actuarial Receivables] are allocated.
The composition of the Receivables, distribution by Contract Rate of the
Receivables and the geographic distribution of the Receivables, in each case as
of the Cutoff Date, are set forth in the following tables.
COMPOSITION OF THE RECEIVABLES
<TABLE>
<CAPTION>
NEW FINANCED USED FINANCED
VEHICLES VEHICLES TOTAL
--------------- --------------- ---------------
<S> <C> <C> <C>
Aggregrate Principal Balance........................... $ $ $
Number of Receivables..................................
Average Principal Balance.............................. $ $ $
Average Original Balance............................... $ $ $
Weighted Average Contract Rate......................... % % %
Contract Rate (Range).................................. % to % % to % % to %
Weighted Average Original Term......................... months months months
Original Term (Range).................................. to months to months to months
Weighted Average Remaining Term........................ months months months
Remaining Term (Range)................................. to months to months to months
</TABLE>
S-10
<PAGE>
DISTRIBUTION BY CONTRACT RATE OF THE RECEIVABLES
<TABLE>
<CAPTION>
PERCENT OF
NUMBER OF ORIGINAL POOL
CONTRACT RATE RANGE RECEIVABLES PRINCIPAL BALANCE BALANCE
- - - -------------------------------------------------------- ----------- ----------------- -------------
<S> <C> <C> <C>
% to below % $ %
% to below % %
% to below % %
% to below % %
% to below % %
% to below % %
% to below % %
% to below % %
% to below % %
% to below % %
% to below % %
% to below % %
% to below % %
% to below % %
% to below % %
% to below % %
% to below % %
% to below % %
% to below % %
% to below % %
% to below % %
% to below % %
% to below % %
% to below % %
% to below % %
----------- ----------------- -------------
Total(1) %
----------- ----------------- -------------
----------- ----------------- -------------
</TABLE>
- - - ------------------
(1) Dollar amounts and percentages may not add to the total or to 100.00%,
respectively, due to rounding.
S-11
<PAGE>
GEOGRAPHIC DISTRIBUTION OF THE RECEIVABLES(1)
<TABLE>
<CAPTION>
PERCENT OF
NUMBER OF ORIGINAL
STATE RECEIVABLES PRINCIPAL BALANCE POOL BALANCE
- - - --------------------------------------------------------------------- ----------- ----------------- ------------
<S> <C> <C> <C>
Arizona.............................................................. $ %
Arkansas.............................................................
California...........................................................
Colorado.............................................................
Connecticut..........................................................
Delaware.............................................................
District of Columbia.................................................
Florida..............................................................
Georgia..............................................................
Hawaii...............................................................
Idaho................................................................
Illinois.............................................................
Indiana..............................................................
Iowa.................................................................
Kansas...............................................................
Kentucky.............................................................
Louisiana............................................................
Maine................................................................
Maryland.............................................................
Massachusetts........................................................
Michigan.............................................................
Minnesota............................................................
Mississippi..........................................................
Missouri.............................................................
Montana..............................................................
Nebraska.............................................................
Nevada...............................................................
New Jersey...........................................................
New Mexico...........................................................
New York.............................................................
North Carolina.......................................................
North Dakota.........................................................
New Hampshire........................................................
Ohio.................................................................
Oklahoma.............................................................
Oregon...............................................................
Pennsylvania.........................................................
Rhode Island.........................................................
South Carolina.......................................................
South Dakota.........................................................
Tennessee............................................................
Texas................................................................
Utah.................................................................
Vermont..............................................................
Virginia.............................................................
Washington...........................................................
West Virginia........................................................
Wisconsin............................................................
Wyoming..............................................................
--- ----------------- ---
Total(2)............................................................. $ %
--- ----------------- ---
--- ----------------- ---
</TABLE>
(Footnotes on next page)
S-12
<PAGE>
(Footnotes from previous page)
- - - ------------------
(1) Based on location of the related Obligor (in the case of Direct Receivables)
or the Dealer from which the related Motor Vehicle Loan was acquired or
through which it was made (in the case of Receivables which are not Direct
Receivables).
(2) Dollar amounts and percentages may not add to the total or to 100.00%,
respectively, due to rounding.
DELINQUENCY AND LOAN LOSS INFORMATION
The following tables set forth information with respect to delinquencies,
loan losses and recoveries for the Chase Auto Finance Portfolio as of the dates
indicated and for each of the one year periods ended December 31, 199 , 199 ,
199 , 199 and 199 . The portions of the Chase Auto Finance Portfolio that
provide for payments based upon variable rate simple interest [and the actuarial
method] are included in the following tables, but Motor Vehicle Loans of such
type are not included in the Trust. Chase Auto Finance does not maintain
separate records that distinguish among the delinquency and loan loss experience
for Motor Vehicle Loans that provide for payments based upon fixed rate simple
interest (such as the Receivables), [and] variable rate simple interest [and the
actuarial method]. The Seller believes, however, that the delinquency and loan
loss experience with respect to the fixed rate simple [and actuarial] interest
Motor Vehicle Loans included in the Trust is not materially different from the
performance of the Chase Auto Finance Portfolio set forth below.
Approximately % of the Original Pool Balance were Direct Receivables. The
delinquency and loan loss experience for Direct Receivables are not included in
the performance of the Chase Auto Finance Portfolio set forth below. The Seller
believes that the delinquency and loan loss experience for Direct Receivables
has not been materially different from the performance of the Chase Auto Finance
Portfolio set forth below.
See 'The Receivables Pools--General' and '--Delinquency and Loan Loss
Information' in the Prospectus for a description of the composition of the Chase
Auto Finance Portfolio.
The data presented in the following tables are for illustrative purposes
only. Delinquency and loan loss experience may be influenced by a variety of
economic, social and other factors. No assurance can be given that the
delinquency and loan loss information of the Bank, or of the Trust with respect
to the Receivables, in the future will be similar to that set forth below.
S-13
<PAGE>
DELINQUENCY EXPERIENCE(1)(2)
<TABLE>
<CAPTION>
AS OF DECEMBER 31,
--------------------------------------------------------------------
199 199 199
-------------------- -------------------- --------------------
NUMBER NUMBER NUMBER
DOLLARS OF DOLLARS OF DOLLARS OF
(000'S) LOANS (000'S) LOANS (000'S) LOANS
---------- ------ ---------- ------ ---------- ------
<S> <C> <C> <C> <C> <C> <C>
Outstanding Principal Amount............................. $ $ $
---------- ------ ---------- ------ ---------- ------
---------- ------ ---------- ------ ---------- ------
Delinquencies(3)(4)
30-59 Days............................................. $ $ $
60-89 Days.............................................
90 Days or More........................................
---------- ------ ---------- ------ ---------- ------
---------- ------ ---------- ------ ---------- ------
TOTAL Delinquencies...................................... $ $ $
Repossession Inventory(5)................................
---------- ------ ---------- ------ ---------- ------
---------- ------ ---------- ------ ---------- ------
TOTAL Delinquencies &
Repossession Inventory................................. $ $ $
---------- ------ ---------- ------ ---------- ------
---------- ------ ---------- ------ ---------- ------
Delinquencies(3)(4)(6)
30-59 Days............................................. % % %
60-89 Days............................................. % % %
90 Days or More........................................ % % %
---------- ---------- ----------
TOTAL Delinquencies(6)(7)................................ % % %
Repossession Inventory(6)................................ % % %
---------- ---------- ----------
TOTAL Delinquencies &
Repossession Inventory(6)(7)........................... % % %
---------- ---------- ----------
---------- ---------- ----------
<CAPTION>
199 199
-------------------- --------------------
NUMBER NUMBER
DOLLARS OF DOLLARS OF
(000'S) LOANS (000'S) LOANS
---------- ------ ---------- ------
<S> <C> <C> <C> <C>
Outstanding Principal Amount............................. $ $
---------- ------ ---------- ------
---------- ------ ---------- ------
Delinquencies(3)(4)
30-59 Days............................................. $ $
60-89 Days.............................................
90 Days or More........................................
---------- ------ ---------- ------
---------- ------ ---------- ------
TOTAL Delinquencies...................................... $ $
Repossession Inventory(5)................................
---------- ------ ---------- ------
---------- ------ ---------- ------
TOTAL Delinquencies &
Repossession Inventory................................. $ $
---------- ------ ---------- ------
---------- ------ ---------- ------
Delinquencies(3)(4)(6)
30-59 Days............................................. % %
60-89 Days............................................. % %
90 Days or More........................................ % %
---------- ----------
TOTAL Delinquencies(6)(7)................................ % %
Repossession Inventory(6)................................ % %
---------- ----------
TOTAL Delinquencies &
Repossession Inventory(6)(7)........................... % %
---------- ----------
---------- ----------
</TABLE>
- - - ------------------
(1) The delinquency experience presented does not include experience with
respect to Direct Receivables.
(2) As of December 31, 199 , approximately % of the aggregate principal
balance of Motor Vehicle Loans in the portfolio presented were Chase
Maryland Loans.
(3) Delinquencies include principal amounts only.
(4) The period of delinquency is based on the number of days payments are
contractually past due.
(5) As of December 31, 1994 and earlier, amounts shown in repossession inventory
represent loans which have been written down to the fair market value of the
collateral, but where the related financed vehicles have not yet been sold.
As of December 31, 1995 and later, the amounts shown in repossession
inventory represent the total outstanding principal balance of the loans at
such times.
(6) As a percent of outstanding principal in dollars.
(7) Percentages representing TOTAL Delinquencies and TOTAL Delinquencies &
Repossession Inventory may not add to the components thereof due to
rounding.
S-14
<PAGE>
LOAN LOSS EXPERIENCE(1)(2)
(DOLLARS IN 000'S)
<TABLE>
<CAPTION>
YEAR ENDED
----------------------------------------------------------------------------
DECEMBER 31, DECEMBER 31, DECEMBER 31, DECEMBER 31, DECEMBER 31,
199 199 199 199 199
------------ ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C>
Number of Loans(3).................
Period End Outstanding Principal
Amount........................... $ $ $ $ $
Average Outstanding Principal
Amount(4)........................ $ $ $ $ $
Number of Gross Charge-Offs........
Gross Charge-Offs(5)............... $ $ $ $ $
Gross Charge-Offs as a % of Period
End Outstanding Principal
Amount(5)........................ % % % % %
Gross Charge-Offs as a % of Average
Outstanding Principal
Amount(5)........................ % % % % %
Recoveries(6)...................... $ $ $ $ $
Net Charge-Offs(7)................. $ $ $ $ $
Net Charge-Offs(7) as a % of Period
End Outstanding Principal
Amount(5)........................ % % % % %
Net Charge-Offs(7) as a % of
Average Outstanding Principal
Amount(5)........................ % % % % %
</TABLE>
- - - ------------------
(1) The loan loss experience presented does not include experience with respect
to Direct Receivables.
(2) As of December 31, 199 , approximately % of the aggregate principal
balance of Motor Vehicle Loans in the portfolio presented were Chase
Maryland Loans.
(3) Number of loans as of period end.
(4) The average for 1992 was computed by taking the simple average of month end
outstanding principal amounts for such period, and the average for each
other period presented was computed by taking a simple average of monthly
average outstanding principal amounts for such period presented.
(5) Amount charged off is remaining principal balance less proceeds from sale of
repossessed vehicles.
(6) Recoveries generally include amounts received with respect to loans
previously charged-off, except for proceeds realized in connection with the
sale of the repossessed vehicles.
(7) Net Charge-Offs mean gross charge-offs minus recoveries of loans previously
charged-off. Net Charge-Offs may not equal the difference of the components
thereof due to rounding.
S-15
<PAGE>
CHASE USA
Information regarding the Seller and the Servicer is set forth under 'Chase
USA' in the Prospectus. At , 199 , Chase USA's total assets were
approximately $ billion, total liabilities were approximately $
billion and total stockholders' equity was approximately $ billion.
USE OF PROCEEDS
After the deposit of the Reserve Account Initial Deposit and the deduction
of estimated expenses, the net proceeds to be received by the Seller from the
sale of Notes will be added to its general funds.
WEIGHTED AVERAGE LIFE OF THE NOTES
Information regarding certain maturity and prepayment considerations with
respect to the Notes is set forth under 'Weighted Average Life of Securities' in
the Prospectus. No principal payments will be made on the Class A-2 Notes until
all Class A-1 Notes have been paid in full, no principal payments will be made
on the Class A-3 Notes until all Class A-2 Notes have been paid in full, no
principal payments will be made on the Class A-4 Notes until all Class A-3 Notes
have been paid in full and no principal payments will be made on the Class B
Notes until all Class A-4 Notes have been paid in full. See 'Description of the
Notes--Payments of Principal' herein. As the rate of payment of principal of
each class of Notes depends primarily on the rate of payment (including
prepayments) of the principal balance of the Receivables, final payment of any
class of the Notes could occur significantly earlier than their respective Final
Scheduled Distribution Dates. It is expected that final payment of the Notes
will occur on or prior to the related Final Scheduled Distribution Date.
However, if sufficient funds are not available to pay the Notes in full on or
prior to the related Note Final Scheduled Distribution Date, final payment of
the Notes could occur later than such date. Noteholders will bear the risk of
being able to reinvest principal payments of the Notes at yields at least equal
to the Interest Rate.
If the Reserve Account is exhausted and losses on the Receivables occur,
the amount of interest distributed to the Noteholders may be less than described
above. If an Event of Default has occurred and the maturity of the Notes has
been accelerated, the Class B Noteholders will not be entitled to receive any
distributions in respect of interest on or principal of the Class B Notes until
the Class A Notes have been paid in full.
Subject to the conditions set forth herein under the heading 'Description
of the Transfer and Servicing Agreements--Servicing Procedures,' the Servicer
may reschedule the Due Date of any scheduled payment. Any such deferrals will
have the effect of increasing the weighted average life of the Notes. However,
the Servicer will not be permitted to grant any such deferral or extension if,
as a result, the final scheduled payment on a Receivable would fall after the
Final Scheduled Maturity Date, unless the Servicer purchases such Receivable.
Chase Auto Finance maintains limited records of the historical prepayment
experience of certain portions of the Chase Auto Finance Portfolio. The Seller
believes that such records are not adequate to provide meaningful information
with respect to the Receivables. In any event, no assurance can be given that
prepayments on the Receivables would conform to any historical experience, and
no prediction can be made as to the actual prepayment experience to be expected
with respect to the Receivables.
Prepayments on motor vehicle receivables can be measured relative to a
prepayment standard or model. The model used in this Prospectus Supplement, the
Absolute Prepayment Model ('ABS'), represents an assumed rate of prepayment each
month relative to the original number of receivables in a pool of receivables.
ABS further assumes that all the receivables are the same size and amortize at
the same rate and that each receivable in each month of its life will either be
paid as scheduled or be prepaid in full. For example, in a pool of receivables
originally containing 10,000 receivables, a 1% ABS rate means that 100
receivables prepay each month. ABS does not purport to be an historical
description of prepayment experience or a prediction of the anticipated rate of
prepayment of any pool of receivables, including the Receivables.
The table captioned 'Percent of Initial Note Principal Balance at Various
ABS Percentages' (the 'ABS TABLE') has been prepared on the basis of the
characteristics of the Receivables. The ABS Table assumes that (a) the
Receivables prepay in full at the specified constant percentage of ABS monthly,
with no defaults, losses or repurchases, (b) each scheduled monthly payment on
the Receivables is made on the last day of each month and
S-16
<PAGE>
each month has 30 days, (c) payments on the Notes are made on each Distribution
Date (and each such date is assumed to be the 15th day of each applicable
month), (d) the balance in the Reserve Account on each Distribution Date is
equal to the Specified Reserve Account Balance, and (e) the Servicer does not
exercise its option to purchase the Receivables. The Receivables Pool has an
assumed cutoff date of the Cutoff Date. The ABS Table indicates the projected
weighted average life of each class of Notes and sets forth the percent of the
initial principal amount of each class of Notes that is projected to be
outstanding after each of the Distribution Dates shown at various constant ABS
percentages.
The ABS Tables also assume that (i) the Receivables have been aggregated
into hypothetical pools with all of the Receivables within each such pool having
the following characteristics and that (ii) the level scheduled monthly payment
for each such pool (which is based on its principal balance, weighted average
Contract Rate, weighted average original term to maturity and weighted average
remaining term to maturity as of the Cutoff Date) will be such that each pool
will be fully amortized by the end of its remaining term to maturity.
<TABLE>
<CAPTION>
REMAINING WEIGHTED WEIGHTED
TERM TO WEIGHTED AVERAGE AVERAGE
MATURITY AVERAGE ORIGINAL TERM REMAINING TERM
RANGE AGGREGATE CONTRACT TO MATURITY TO MATURITY
POOL (IN MONTHS) PRINCIPAL BALANCE RATE (IN MONTHS) (IN MONTHS)
- - - ----- ----------- ----------------- -------- ------------- --------------
<S> <C> <C> <C> <C> <C>
1 $ %
2 %
3 %
4 %
5
-----------------
$
-----------------
-----------------
</TABLE>
The information included in the following tables represents forward-looking
statements and involves risks and uncertainties that could cause actual results
to differ materially from those in the forward-looking statements. The actual
characteristics and performance of the Receivables will differ from the
assumptions used in constructing each ABS Table. The assumptions used are
hypothetical and have been provided only to give a general sense of how the
principal cash flows might behave under varying prepayment scenarios. For
example, it is very unlikely that the Receivables will prepay at a constant
level of ABS until maturity or that all of the Receivables will prepay at the
same level of ABS. Moreover, the diverse terms of Receivables within each of the
five hypothetical pools could produce slower or faster principal distributions
than indicated in each ABS Table at the various constant percentages of ABS
specified, even if the original and remaining terms to maturity of the
Receivables are as assumed. Any difference between such assumptions and the
actual characteristics and performance of the Receivables, or actual prepayment
experience, will affect the percentages of initial balances outstanding over
time and the weighted average lives of each class of Notes.
S-17
<PAGE>
PERCENT OF INITIAL NOTE PRINCIPAL BALANCE AT VARIOUS ABS PERCENTAGES
<TABLE>
<CAPTION>
CLASS A-1 NOTES CLASS A-2 NOTES
---------------------------- ----------------------------
ASSUMED ABS PERCENTAGE(2) ASSUMED ABS PERCENTAGE(2)
---------------------------- ----------------------------
DISTRIBUTION DATES % % % % % % % %
- - - ------------------------------------------------------ ---- ---- ---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Closing Date..........................................
Weighted Average Life (years)(1)......................
</TABLE>
- - - ------------------
(1) The weighted average life of a Note is determined by (i) multiplying the
amount of each principal payment of such Note by the number of years from
the date of the issuance of such Note to the Distribution Date on which such
principal payment is made, (ii) adding the results and (iii) dividing the
sum by the initial principal balance of such Note.
(2) An asterisk '*' means a percent of initial Note principal balance of more
than zero and less than 0.5%.
THE ABS TABLES HAVE BEEN PREPARED BASED ON THE ASSUMPTIONS DESCRIBED ABOVE
(INCLUDING THE ASSUMPTIONS REGARDING THE CHARACTERISTICS AND PERFORMANCE OF THE
RECEIVABLES WHICH WILL DIFFER FROM THE ACTUAL CHARACTERISTICS AND PERFORMANCE
THEREOF) AND SHOULD BE READ IN CONJUNCTION THEREWITH.
S-18
<PAGE>
PERCENT OF INITIAL NOTE PRINCIPAL BALANCE AT VARIOUS ABS PERCENTAGES
<TABLE>
<CAPTION>
CLASS A-3 NOTES CLASS A-4 NOTES
-------------------------------- --------------------------------
ASSUMED ABS PERCENTAGE(2) ASSUMED ABS PERCENTAGE(2)
-------------------------------- --------------------------------
DISTRIBUTION DATES % % % % % % % %
- - - ---------------------------------------------- ----- ----- ----- ----- ----- ----- ----- -----
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Closing Date..................................
Weighted Average Life (years)(1)..............
</TABLE>
- - - ------------------
(1) The weighted average life of a Note is determined by (i) multiplying the
amount of each principal payment of such Note by the number of years from the
date of the issuance of such Note to the Distribution Date on which such
principal payment is made, (ii) adding the results and (iii) dividing the sum by
the initial principal balance of such Note.
(2) An asterisk '*' means a percent of initial Note principal balance of more
than zero and less than 0.5%.
THE ABS TABLES HAVE BEEN PREPARED BASED ON THE ASSUMPTIONS DESCRIBED ABOVE
(INCLUDING THE ASSUMPTIONS REGARDING THE CHARACTERISTICS AND PERFORMANCE OF THE
RECEIVABLES WHICH WILL DIFFER FROM THE ACTUAL CHARACTERISTICS AND PERFORMANCE
THEREOF) AND SHOULD BE READ IN CONJUNCTION THEREWITH.
S-19
<PAGE>
PERCENT OF INITIAL NOTE PRINCIPAL BALANCE AT VARIOUS ABS PERCENTAGES (CONTINUED)
<TABLE>
<CAPTION>
CLASS A-3 NOTES CLASS A-4 NOTES
-------------------------------- --------------------------------
ASSUMED ABS PERCENTAGE(2) ASSUMED ABS PERCENTAGE(2)
-------------------------------- --------------------------------
DISTRIBUTION DATES % % % % % % % %
- - - ---------------------------------------------- ----- ----- ----- ----- ----- ----- ----- -----
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Closing Date..................................
Weighted Average Life (years)(1)..............
</TABLE>
- - - ------------------
(1) The weighted average life of a Note is determined by (i) multiplying the
amount of each principal payment of such Note by the number of years from
the date of the issuance of such Note to the Distribution Date on which such
principal payment is made, (ii) adding the results and (iii) dividing the
sum by the initial principal balance of such Note.
(2) An asterisk '*' means a percent of initial Note principal balance of more
than zero and less than 0.5%.
THE ABS TABLES HAVE BEEN PREPARED BASED ON THE ASSUMPTIONS DESCRIBED ABOVE
(INCLUDING THE ASSUMPTIONS REGARDING THE CHARACTERISTICS AND PERFORMANCE OF THE
RECEIVABLES WHICH WILL DIFFER FROM THE ACTUAL CHARACTERISTICS AND PERFORMANCE
THEREOF) AND SHOULD BE READ IN CONJUNCTION THEREWITH.
S-20
<PAGE>
PERCENT OF INITIAL NOTE PRINCIPAL BALANCE AT VARIOUS ABS PERCENTAGES
<TABLE>
<CAPTION>
CLASS B NOTES
--------------------------------
ASSUMED ABS PERCENTAGE(2)
--------------------------------
DISTRIBUTION DATES % % % %
- - - -------------------------------------------------------------------------------- ----- ----- ----- -----
<S> <C> <C> <C> <C>
Closing Date....................................................................
Weighted Average Life (years)(1)................................................
</TABLE>
- - - ------------------
(1) The weighted average life of a Note is determined by (i) multiplying the
amount of each principal payment of such Note by the number of years from
the date of the issuance of such Note to the Distribution Date on which such
principal payment is made, (ii) adding the results and (iii) dividing the
sum by the initial principal balance of such Note.
(2) An asterisk '*' means a percent of initial Note principal balance of more
than zero and less than 0.5%.
THE ABS TABLES HAVE BEEN PREPARED BASED ON THE ASSUMPTIONS DESCRIBED ABOVE
(INCLUDING THE ASSUMPTIONS REGARDING THE CHARACTERISTICS AND PERFORMANCE OF THE
RECEIVABLES WHICH WILL DIFFER FROM THE ACTUAL CHARACTERISTICS AND PERFORMANCE
THEREOF) AND SHOULD BE READ IN CONJUNCTION THEREWITH.
S-21
<PAGE>
PERCENT OF INITIAL NOTE PRINCIPAL BALANCE AT VARIOUS ABS PERCENTAGES (CONTINUED)
<TABLE>
<CAPTION>
CLASS B NOTES
--------------------------------
ASSUMED ABS PERCENTAGE(2)
--------------------------------
DISTRIBUTION DATES % % % %
- - - -------------------------------------------------------------------------------- ----- ----- ----- -----
<S> <C> <C> <C> <C>
Closing Date....................................................................
Weighted Average Life (years)(1)................................................
</TABLE>
- - - ------------------
(1) The weighted average life of a Note is determined by (i) multiplying the
amount of each principal payment of such Note by the number of years from
the date of the issuance of such Note to the Distribution Date on which such
principal payment is made, (ii) adding the results and (iii) dividing the
sum by the initial principal balance of such Note.
(2) An asterisk '*' means a percent of initial Note principal balance of more
than zero and less than 0.5%.
THE ABS TABLES HAVE BEEN PREPARED BASED ON THE ASSUMPTIONS DESCRIBED ABOVE
(INCLUDING THE ASSUMPTIONS REGARDING THE CHARACTERISTICS AND PERFORMANCE OF THE
RECEIVABLES WHICH WILL DIFFER FROM THE ACTUAL CHARACTERISTICS AND PERFORMANCE
THEREOF) AND SHOULD BE READ IN CONJUNCTION THEREWITH.
S-22
<PAGE>
DESCRIPTION OF THE NOTES
GENERAL
The Notes will be issued pursuant to the terms of the Indenture, a form of
which has been filed as an exhibit to the Registration Statement. A copy of the
Indenture will be filed with the Commission following the issuance of the Notes.
The following, as well as other pertinent information included elsewhere in this
Prospectus Supplement and in the Prospectus, summarizes the material terms of
the Notes and the Indenture. The summary does not purport to be complete and is
subject to, and is qualified in its entirety by reference to, all the provisions
of the Notes and the Indenture. The following summary supplements the
description of the general terms and provisions of the Notes of any given series
and the related Indenture set forth in the Prospectus, to which description
reference is hereby made. , with its corporate trust
offices located at , will be the Indenture Trustee under
the Indenture. In the ordinary course of its business, the Indenture Trustee and
its affiliates have engaged and may in the future engage in commercial banking
or financial advisory transactions with the Bank and its affiliates.
PAYMENTS OF INTEREST
Each class of the Notes offered hereby will constitute Fixed Rate
Securities as such term is defined under 'Certain Information Regarding the
Securities--Fixed Rate Securities' in the Prospectus. Interest on the principal
balances of each class of Notes will accrue at the related per annum Interest
Rate and will be payable to the Noteholders monthly on each Distribution Date,
commencing , 199 . Interest on the outstanding principal amount of
each class of Notes will accrue at the related Interest Rate for each Interest
Accrual Period and shall be calculated on the basis of a 360-day year based on
the actual number of days, with respect to the Class A-1 Notes [(which will be
days with respect to the Interest Accrual Period for the
Distribution Date)], and on the basis of a 360-day year of twelve 30-day months,
with respect to the Class A-2 Notes, Class A-3 Notes, Class A-4 Notes and Class
B Notes. Interest payments on the Notes will generally be derived from the Total
Distribution Amount and the amounts, if any, on deposit in the Reserve Account
remaining after the payment of the Servicing Fee and the Administration Fee and,
in the case of the Class B Notes, payments of the Class A Noteholders' Interest
Distributable Amount. See 'Description of the Transfer and Servicing
Agreements--Distributions' and '--Subordination of Class B Noteholders; Reserve
Account' herein.
Interest payments to all classes of Class A Noteholders will have the same
priority. Under certain circumstances, the amount available for interest
payments on the Class A Notes could be less than the amount of interest payable
on the Class A Notes on any Distribution Date, in which case each class of Class
A Noteholders will receive their ratable share (based upon the aggregate amount
of interest due to such class of Class A Noteholders) of the aggregate amount
available to be distributed in respect of interest on the Class A Notes.
Interest on the Class B Notes will not be paid on any Distribution Date
until all accrued and unpaid interest on the Class A Notes has been paid in
full. In addition, if an Event of Default has occurred and Notes have been
accelerated, the Class B Noteholders will not be entitled to any payment of
interest on or principal of the Class B Notes until the Class A Notes have been
paid in full.
PAYMENTS OF PRINCIPAL
Principal payments will be made to the Noteholders on each Distribution
Date in an amount generally equal to the Noteholders' Principal Distributable
Amount. Principal payments on the Class A Notes will generally be derived from
the Total Distribution Amount and the amounts, if any, on deposit in the Reserve
Account remaining after the payment of the Servicing Fee, the Administration
Fee, the Class A Noteholders' Interest Distributable Amount and the Class B
Noteholders' Interest Distributable Amount.
On each Distribution Date, principal payments on the Notes, to the extent
of the Noteholders' Principal Distributable Amount, will be applied in the
following order of priority: (i) to the principal balance of the Class A-1 Notes
until the principal balance of the Class A-1 Notes is reduced to zero; (ii) to
the principal balance of the Class A-2 Notes until the principal balance of the
Class A-2 Notes is reduced to zero; (iii) to the principal balance of the Class
A-3 Notes until the principal balance of the Class A-3 Notes is reduced to zero;
(iv) to the
S-23
<PAGE>
principal balance of the Class A-4 Notes until the principal balance of the
Class A-4 Notes is reduced to zero; and (v) to the principal balance of the
Class B Notes until the principal balance of the Class B Notes is reduced to
zero. Notwithstanding the foregoing, if an Event of Default has occurred and the
Notes have been accelerated, the Noteholders' Principal Distributable Amount
shall be applied to the repayment of principal on each class of Class A Notes
pro rata on the basis of their respective unpaid principal amounts, and the
Class B Noteholders will not be entitled to receive any distributions of
interest on or principal of the Class B Notes until the Class A Notes have been
paid in full. The principal balance of the Class A-1 Notes, to the extent not
previously paid, will be due on the Class A-1 Final Scheduled Distribution Date,
the principal balance of the Class A-2 Notes, to the extent not previously paid,
will be due on the Class A-2 Final Scheduled Distribution Date, the principal
balance of the Class A-3 Notes, to the extent not previously paid, will be due
on the Class A-3 Final Scheduled Distribution Date, the principal balance of the
Class A-4 Notes, to the extent not previously paid, will be due on the Class A-4
Final Scheduled Distribution Date and the principal balance of the Class B
Notes, to the extent not previously paid, will be due on the Class B Final
Scheduled Distribution Date. The actual date on which the aggregate outstanding
principal amount of any class of Notes is paid may be earlier than the
respective Note Final Scheduled Distribution Dates set forth above based on a
variety of factors, including those described under 'Weighted Average Life of
the Notes' herein and 'Weighted Average Life of the Securities' in the
Prospectus.
OPTIONAL REDEMPTION
On any Distribution Date after the Class A-1 Notes, Class A-2 Notes and the
Class A-3 Notes have been paid in full, the Class A-4 Notes and the Class B
Notes will be redeemed in whole, but not in part, if the Servicer exercises its
option to purchase the Receivables. The Servicer may purchase the Receivables
after the last day of a Collection Period as to which the Pool Balance shall
have declined to 5% or less of the Original Pool Balance, as described in the
Prospectus under 'Description of the Transfer and Servicing
Agreements--Termination.' The redemption price will be equal to the unpaid
principal amount of the Class A-4 Notes or the Class B Notes, as the case may
be, plus accrued and unpaid interest thereon.
INDENTURE
Events of Default; Rights upon Event of Default. With respect to the
Notes, 'EVENTS OF DEFAULT' under the Indenture will consist of: (i) a default in
the payment of any interest on any such Note for a period of five days; (ii) a
default in the payment of the principal of or any installment of the principal
of any such Note when the same becomes due and payable; (iii) a default in the
observance or performance of any covenant or agreement of the Trust made in the
Indenture, which default materially adversely affects the rights of the
Noteholders and which default continues for a period of 30 days after written
notice thereof is given to the Trust by the Indenture Trustee or to the Trust
and the Indenture Trustee by the Noteholders representing at least 25% of the
aggregate principal amount of the Controlling Notes then outstanding (or for
such longer period, not in excess of 90 days, as may be reasonably necessary to
remedy such default; provided that such default is capable of remedy within 90
days or less); or (iv) certain events of bankruptcy, insolvency, receivership or
liquidation of the Trust. However, the amount of principal required to be paid
to Noteholders under the Indenture will generally be limited to amounts
available to be deposited in the Note Distribution Account (absent acceleration
of the Notes). Therefore, the failure to pay principal on a class of Notes on
any Distribution Date generally will not result in the occurrence of an Event of
Default until the Note Final Scheduled Distribution Date for such class of
Notes.
If an Event of Default should occur and be continuing with respect to the
Notes, the Indenture Trustee or the Noteholders representing not less than a
majority of the aggregate principal amount of the Controlling Notes then
outstanding may declare the principal of the Notes to be immediately due and
payable. Such declaration may, under certain circumstances, be rescinded by the
Noteholders representing not less than a majority of the aggregate principal
amount of such Controlling Notes then outstanding.
'CONTROLLING NOTES' means all classes of Class A Notes voting together as a
single class until the Class A Notes have been paid in full, and thereafter
means the Class B Notes.
If the Notes are declared to be due and payable following an Event of
Default with respect thereto, the Indenture Trustee may institute proceedings to
collect amounts due or foreclose on the Trust property, exercise remedies as a
secured party, sell the Receivables or elect to have the Trust maintain
possession of the Receivables
S-24
<PAGE>
and continue to apply collections on the Receivables as if there had been no
declaration of acceleration. However, the Indenture Trustee is prohibited from
selling the Receivables following an Event of Default, unless (i) the
Noteholders representing 100% of the aggregate principal amount of the Notes
then outstanding consent to such sale, (ii) the proceeds of such sale are
sufficient to pay in full the principal of and the accrued interest on the
outstanding Notes at the date of such sale, or (iii) there has been an Event of
Default arising from a failure to make a required payment of principal of or
interest on any Notes, and the Indenture Trustee determines that the proceeds of
the Receivables would not be sufficient on an ongoing basis to make all payments
on the Notes as such payments would have become due if such obligations had not
been declared due and payable, and the Indenture Trustee obtains the consent of
Noteholders representing at least 66 2/3% of the aggregate principal amount of
the Controlling Notes then outstanding.
If an Event of Default occurs and is continuing with respect to the Notes,
the Indenture Trustee will be under no obligation to exercise any of the rights
or powers under the Indenture at the request or direction of any of the
Notehodlers if the Indenture Trustee reasonably believes it will not be
adequately indemnified against the costs, expenses and liabilities that might be
incurred by it in complying with such request. Subject to the provisions for
indemnification and certain limitations contained in the Indenture, the
Noteholders representing not less than a majority of the aggregate principal
amount of the Controlling Notes then outstanding will have the right to direct
the time, method and place of conducting any proceeding or any remedy available
to the Indenture Trustee, and the Noteholders representing not less than a
majority of the aggregate principal amount of the Controlling Notes then
outstanding may, in certain cases, waive any default with respect thereto,
except a default in the payment of principal or interest or a default in respect
of a covenant or provision of the Indenture that cannot be modified without the
waiver of consent of all the Noteholders representing 100% of the aggregate
principal amount of the Controlling Notes then outstanding.
No Noteholder will have the right to institute any proceeding with respect
to the Indenture unless (i) such holder has previously given written notice to
the Indenture Trustee of a continuing Event of Default, (ii) the Noteholders
representing at least 25% of the aggregate principal amount of the Controlling
Notes then outstanding have made written request to the Indenture Trustee to
institute such proceeding in its own name as Indenture Trustee, (iii) such
Noteholder or Noteholders have offered the Indenture Trustee indemnity
reasonably satisfactory to it against the costs, expenses and liabilities to be
incurred in complying with such request, (iv) the Indenture Trustee has for 60
days after receipt of such notice, request and offer of indemnity failed to
institute such proceeding, and (v) no direction inconsistent with such written
request has been given to the Indenture Trustee during such 60-day period by the
Noteholders representing not less than a majority of the aggregate principal
amount of the Controlling Notes then outstanding.
Pursuant to the Trust Indenture Act of 1939, as amended, the Indenture
Trustee will be deemed to have a conflict of interest and be required to resign
as trustee for either the Class A Notes or the Class B Notes if an Event of
Default occurs under the Indenture. In these circumstances, the Indenture will
require that, within 90 days of ascertaining such Event of Default, the
Indenture Trustee will resign as Indenture Trustee for the Class A Notes or the
Class B Notes and will provide for a successor indenture trustee to be appointed
for one or both of the Class A Notes and Class B Notes, as applicable, in order
that there be separate indenture trustees for each of the Class A Notes and the
Class B Notes. So long as any amounts remain unpaid with respect to the Class A
Notes, only the indenture trustee for the Class A Noteholders will have the
right to exercise remedies under the Indenture (but the Class B Noteholders will
be entitled to their shares of any proceeds of enforcement, subject to the
subordination of the Class B Notes to the Class A Notes as described herein),
and, except as described herein, only the Class A Noteholders will have the
right to direct or consent to any action to be taken, including sale of the
Receivables, until the Class A Notes are paid in full. Upon repayment of the
Class A Notes in full, all rights to exercise remedies under the Indenture will
transfer to the trustee for the Class B Notes. Any resignation of the original
Indenture Trustee as described above with respect to any class of Notes will
become effective only upon the appointment of a successor trustee for such class
of Notes and such successor's acceptance of such appointment.
S-25
<PAGE>
DESCRIPTION OF THE TRANSFER AND SERVICING AGREEMENTS
The following, as well as other information included elsewhere in this
Prospectus Supplement and in the Prospectus, summarizes the material terms of
the Sale and Servicing Agreement, the Trust Agreement and the Administration
Agreement (collectively, the 'TRANSFER AND SERVICING AGREEMENTS'). A form of
each of the Transfer and Servicing Agreements has been filed as an exhibit to
the Registration Statement. A copy of each of the Transfer and Servicing
Agreements will be filed with the Commission following the issuance of the
Notes. The summary does not purport to be complete and is subject to, and
qualified in its entirety by reference to, all the provisions of the Transfer
and Servicing Agreements. The following summary supplements the description of
the general terms and provisions of the Transfer and Servicing Agreements set
forth in the Prospectus, to which description reference is hereby made.
ACCOUNTS
The Servicer will establish the Collection Account [and the Paid-Ahead
Account] in the name of the Indenture Trustee on behalf of the Noteholders and
the Certificateholders, and the Note Distribution Account (the 'NOTE
DISTRIBUTION ACCOUNT') in the name of the Indenture Trustee on behalf of the
Noteholders. The Seller will establish the Reserve Account in the name of the
Indenture Trustee on behalf of the Noteholders. Each of such accounts will be a
'TRUST ACCOUNT' as described under 'Description of the Transfer and Servicing
Agreements--Accounts' in the Prospectus. Each of the Collection Account[, the
Paid-Ahead Account] and the Note Distribution Account, will be established
initially with the trust department of Chase. Chase, in its capacity as the
initial paying agent (the 'PAYING AGENT'), will have the revocable right, at the
direction of the Servicer, to withdraw funds from each Trust Account (other than
the Reserve Account) for the purpose of making distributions to Noteholders in
the manner provided in the Transfer and Servicing Agreements. See
'--Subordination of Class B Noteholders; Reserve Account' below.
[PAID-AHEAD ACTUARIAL RECEIVABLES
Early payments by or on behalf of Obligors on Actuarial Receivables which
do not constitute scheduled payments, full payments, nor certain partial
prepayments that result in a reduction of the Obligor's periodic payment below
the scheduled payment as of the Cutoff Date (a 'PAID-AHEAD') will be deposited
into the Paid-Ahead Account until such time as the Paid-Ahead falls due. Until
such time as Paid-Aheads are transferred from the Paid-Ahead Account to the
Collection Account, they will not constitute collected interest or collected
principal and will not be available for distribution to the Noteholders or
Certificateholders. So long as Chase USA is the Servicer and provided that (i)
there exists no Event of Servicing Termination and (ii) each other condition to
holding Paid-Aheads as may be required by the Sale and Servicing Agreement is
satisfied, Paid-Aheads may be retained by the Servicer until the applicable
Payment Date or Distribution Date.]
SERVICING COMPENSATION AND PAYMENT OF EXPENSES
The Servicer will be entitled to receive the Servicing Fee for each
Collection Period payable on each Distribution Date. The 'SERVICING FEE RATE'
with respect to the Servicing Fee for the Servicer will be % per annum, and
the 'SERVICING FEE' for any Collection Period shall equal an amount equal to the
sum of (i) the product of one-twelfth of the Servicing Fee Rate and the Pool
Balance as of the close of business the related Settlement Date and (ii) any
Late Fees paid by the Obligors during the related Collection Period. 'LATE FEES'
shall mean, collectively, late charges, credit-related extension fees or other
administrative fees or similar charges allowed by applicable law with respect to
the Receivables. In addition, the Servicing Fee will also include Investment
Earnings on amounts on deposit in the Collection Account [and the Paid-Ahead
Account].
The amount of the Servicing Fee was determined in light of the duties of
the Servicer under the Transfer and Servicing Agreements as well as with a view
toward providing the Servicer with a reasonable profit. See 'Description of the
Transfer and Servicing Agreements--Servicing Compensation and Payment of
Expenses' and '--Net Deposits' in the Prospectus.
S-26
<PAGE>
SERVICING PROCEDURES
The Servicer will service the Receivables and will make reasonable efforts
to collect all payments due with respect to the Receivables and, in a manner
consistent with the Sale and Servicing Agreement and with the terms of the
Receivables, will follow such collection and servicing procedures as it follows
with respect to comparable new or used automobile receivables that it services
for itself and that are consistent with prudent industry standards. In addition,
among other things, the Sale and Servicing Agreement will provide that the
Servicer may not change the amount of any Receivable (except with respect to a
prepayment of a scheduled payment that does not result in a deferral of any
other scheduled payment), decrease the Contract Rate of any Receivable, or
extend any Receivable beyond the Final Scheduled Maturity Date.
In the event that the Servicer fails to comply with the foregoing terms of
the Sale and Servicing Agreement and such failure materially and adversely
affects the interests of the Securityholders in a Receivable, it will be
required to purchase the affected Receivable at a price equal to the Repurchase
Amount as of the last day of the Collection Period on which it became aware or
receives written notice from the Indenture Trustee or the Owner Trustee of such
failure. The purchase obligation will constitute the sole remedy available to
the Securityholders, the Trust or the Indenture Trustee for any such uncured
breach.
The Bank will offer certain Obligors or classes of Obligors on an annual
basis a one month noncredit related extension of a regularly scheduled payment
otherwise due under a Receivable. The Sale and Servicing Agreement establishes
criteria governing such extensions.
See 'Description of the Transfer and Servicing Agreements--Servicing
Procedures' in the Prospectus.
DISTRIBUTIONS
Deposits to Collection Account. On or before the 10th day of each month
(or, if such 10th day is not a Business Day, the preceding Business Day), the
Servicer will inform the Indenture Trustee, the Owner Trustee and the Paying
Agent of the following amounts: (i) the Available Interest, the Available
Principal, the Principal Distribution Amount and the Total Distribution Amount
for the next succeeding Distribution Date; (ii) the aggregate Repurchase Amount
of Receivables to be repurchased by the Seller or purchased by the Servicer with
respect to the preceding Collection Period; (iii) the amount to be withdrawn
from the Reserve Account on the next succeeding Deposit Date; (iv) the Class A
Noteholders' Interest Distributable Amount, the Class B Noteholders' Interest
Distributable Amount, the Noteholders' Principal Distributable Amount, the
Certificateholders' Interest Distributable Amount and the Certificateholders'
Principal Distributable Amount for the next succeeding Distribution Date; (v)
the Servicing Fee; (vi) the Administration Fee and (vii) the amount to be
deposited in the Reserve Account and the amount to be distributed to the Seller
therefrom on such Distribution Date.
On or before each Deposit Date, the Servicer will cause all collections and
other amounts constituting the Total Distribution Amount for the related
Distribution Date to be deposited into the Collection Account together with any
amounts withdrawn by the Indenture Trustee from the Reserve Account on such
Deposit Date. [If the Class A-1 Notes are outstanding after the
Distribution Date, there will be a separate Deposit Date in with
respect to the Class A-1 Final Scheduled Distribution Date].
The 'TOTAL DISTRIBUTION AMOUNT' for any Distribution Date will be the sum
of Available Interest and Available Principal for such Distribution Date. The
Total Distribution Amount for any Distribution Date will exclude all payments
and proceeds (including any Liquidation Proceeds and any amounts received from
Dealers with respect to Receivables) of (i) any Receivables the Repurchase
Amount of which has been included in the Total Distribution Amount for a prior
Distribution Date, and (ii) Investment Earnings on the Collection Account[, the
Paid-Ahead Account] and any Late Fees.
Deposits to the Distribution Accounts. On each Distribution Date
[(including, on the Class A-1 Final Scheduled Distribution Date if the Class A-1
Notes are outstanding, certain of the following allocations)], the Servicer
shall instruct the Indenture Trustee or the Paying Agent to make the following
distributions, to the extent of the sum of the Total Distribution Amount and any
amounts withdrawn from the Reserve Account then on
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<PAGE>
deposit in the Collection Account, in the following order of priority (except
under the limited circumstances provided herein):
(i) to the Servicer, the Servicing Fee for the preceding Collection
Period and all unpaid Servicing Fees from prior Collection Periods, to the
extent such amounts are not deducted from the Servicer's remittance to the
Collection Account;
(ii) to the Administrator, the Administration Fee for the preceding
Collection Period and all unpaid Administration Fees from prior Collection
Periods;
(iii) to the Note Distribution Account, the Class A Noteholders'
Interest Distributable Amount;
(iv) to the Note Distribution Account, the Class B Noteholders'
Interest Distributable Amount (unless the Notes have been accelerated);
(v) to the Note Distribution Account, the Noteholders' Principal
Distributable Amount;
(vi) to the Owner Trustee for deposit in the Certificate Distribution
Account, the Certificateholders' Interest Distributable Amount (unless the
Notes have been accelerated); and
(vii) to the Reserve Account, any remaining portion of the Total
Distribution Amount.
For purposes hereof, the following terms shall have the following meanings:
'AVAILABLE INTEREST' means, for any Distribution Date, that portion of
collections on the Receivables received during the related Collection Period
allocated to interest and to the extent attributable to interest, the Repurchase
Amount received with respect to each Receivable repurchased by the Seller or
purchased by the Servicer under an obligation that arose during the related
Collection Period.
'AVAILABLE PRINCIPAL' means, for any Distribution Date, that portion of
collections on the Receivables received during the related Collection Period
allocated to the principal balance of the Receivables, and, to the extent
attributable to principal, the Repurchase Amount received with respect to each
Receivable repurchased by the Seller or purchased by the Servicer under an
obligation that arose during the related Collection Period.
'CERTIFICATE BALANCE' of the Certificates shall be an amount equal to
$ (approximately % of the Original Pool Balance) as of the Closing
Date and, thereafter, shall be an amount equal to such initial Certificate
Balance reduced by all amounts allocable to principal previously distributed to
Certificateholders. The Certificate Balance shall also be reduced on any
Distribution Date by the excess, if any, of (i) the sum of (A) the Certificate
Balance and (B) the outstanding principal amount of the Notes (in each case
after giving effect to amounts in respect of principal to be deposited in the
Certificate Distribution Account, and the Note Distribution Account on such
Distribution Date), over (ii) the Pool Balance as of the close of business on
the last day of the preceding Collection Period. Thereafter, the Certificate
Balance shall be increased on any Distribution Date to the extent that any
portion of the Total Distribution Amount on such Distribution Date is available
to pay the existing Certificateholders' Principal Carryover Shortfall, but not
by more than the aggregate reductions in the Certificate Balance set forth in
the preceding sentence.
'CERTIFICATEHOLDERS' DISTRIBUTABLE AMOUNT' means, for any Distribution
Date, the sum of the Certificateholders' Principal Distributable Amount and the
Certificateholders' Interest Distributable Amount.
'CERTIFICATEHOLDERS' INTEREST CARRYOVER SHORTFALL' means, for (a) the
initial Determination Date, zero, and (b) any other Distribution Date, the
excess of the Certificateholders' Interest Distributable Amount for the
preceding Distribution Date over the amount in respect of interest at the
Certificate Rate that was actually deposited in the Certificate Distribution
Account on such preceding Distribution Date, plus interest on such excess, to
the extent permitted by law, at the Certificate Rate, from and including such
preceding Distribution Date to, but excluding, the current Distribution Date.
'CERTIFICATEHOLDERS' INTEREST DISTRIBUTABLE AMOUNT' means, for any
Distribution Date, the sum of the Certificateholders' Monthly Interest
Distributable Amount for such Distribution Date and the Certificateholders'
Interest Carryover Shortfall for such Distribution Date.
'CERTIFICATEHOLDERS' MONTHLY INTEREST DISTRIBUTABLE AMOUNT' means, for any
Distribution Date, one month's interest (or, in the case of the first
Distribution Date, interest accrued from and including the Closing Date to but
excluding such Distribution Date) at the Certificate Rate on the Certificate
Balance on the
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<PAGE>
immediately preceding Distribution Date (or, in the case of the first
Distribution Date, the Certificate Balance on the Closing Date), after giving
effect to all payments of principal to the Certificateholders on or prior to
such Distribution Date.
'CERTIFICATEHOLDERS' MONTHLY PRINCIPAL DISTRIBUTABLE AMOUNT' means, for any
Distribution Date prior to the Distribution Date on which the Notes have been
paid in full, zero, and for any Distribution Date commencing on or after the
Distribution Date on which the Notes have been paid in full, 100% of the
Principal Distribution Amount (less the portion of the Principal Distribution
Amount required on the first such Distribution Date to pay the Notes in full).
'CERTIFICATEHOLDERS' PRINCIPAL CARRYOVER SHORTFALL' means, for any
Distribution Date, the sum of (a) the excess of (i) the Certificateholders'
Principal Distributable Amount for the preceding Distribution Date, over (ii)
the amount in respect of principal that was actually deposited in the
Certificate Distribution Account on such Distribution Date and (b) without
duplication of clause (a), the unreimbursed portion of the amount by which the
Certificate Balance has been reduced pursuant to the second sentence of the
definition thereof.
'CERTIFICATEHOLDERS' PRINCIPAL DISTRIBUTABLE AMOUNT' means, for any
Distribution Date, the sum of (i) the Certificateholders' Monthly Principal
Distributable Amount for such Distribution Date and (ii) the Certificateholders'
Principal Carryover Shortfall for such Distribution Date; provided, that, the
Certificateholders' Principal Distributable Amount shall not exceed the
Certificate Balance. In addition, on the Certificate Final Scheduled
Distribution Date, the principal required to be distributed to
Certificateholders will include the lesser of (a) any payments of principal due
and remaining unpaid on each Receivable owned by the Issuer as of the last day
of the immediately preceding Collection Period, or (b) the amount that is
necessary (after giving effect to the other amounts to be deposited in the
Certificate Distribution Account on such Distribution Date and allocable to
principal) to reduce the Certificate Balance to zero, in either case, after
giving effect to any required distribution of the Noteholders' Principal
Distributable Amount to the Note Distribution Account.
'CLASS A NOTEHOLDERS' INTEREST CARRYOVER SHORTFALL' means (a) for the
Initial Distribution Date, zero, and (b) for any other Distribution Date, the
excess of (i) the Class A Noteholders' Interest Distributable Amount for the
preceding Distribution Date, over (ii) the amount in respect of interest that
was actually deposited in the Note Distribution Account on such preceding
Distribution Date on account of interest on the Class A Notes, plus interest on
the amount of interest due but not paid to the Class A Noteholders on the
preceding Distribution Date, to the extent permitted by law, at the respective
Interest Rates borne by the Class A Notes for the related Interest Accrual
Period.
'CLASS A NOTEHOLDERS' INTEREST DISTRIBUTABLE AMOUNT' means, for any
Distribution Date, the sum of (x) the Class A Noteholders' Monthly Interest
Distributable Amount for all classes of Class A Notes for such Distribution Date
and (y) the Class A Noteholders' Interest Carryover Shortfall for such
Distribution Date.
'CLASS A NOTEHOLDERS' MONTHLY INTEREST DISTRIBUTABLE AMOUNT' means, for any
Distribution Date, in the case of each class of Class A Notes, interest accrued
during the related Interest Accrual Period at the related Interest Rate on the
outstanding principal balance of the Class A Notes of such class on such
Distribution Date (or, in the case of the first Distribution Date, on the
Closing Date).
'NOTEHOLDERS' MONTHLY PRINCIPAL DISTRIBUTABLE AMOUNT' means, for any
Distribution Date, prior to the Distribution Date on which the Notes have been
paid in full, 100% of the Principal Distribution Amount, and for the
Distribution Date on which the Notes are paid in full, the portion of the
Principal Distribution Amount required to pay the Notes in full.
'NOTEHOLDERS' PRINCIPAL CARRYOVER SHORTFALL' means, for any Distribution
Date, the excess of (x) the Noteholders' Principal Distributable Amount for the
preceding Distribution Date over (y) the amount in respect of principal that was
actually deposited in the Note Distribution Account on such Distribution Date.
'NOTEHOLDERS' PRINCIPAL DISTRIBUTABLE AMOUNT' means, for any Distribution
Date, the sum of (i) the Noteholders' Monthly Principal Distributable Amount for
such Distribution Date and (ii) the Noteholders' Principal Carryover Shortfall
for such preceding Distribution Date; provided, that the Noteholders' Principal
Distributable Amount shall not exceed the outstanding principal balance of the
Notes. In addition, on the Note Final Scheduled Distribution Date of each class
of Notes, the principal required to be deposited in the Note
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Distribution Account will include the amount necessary (after giving effect to
other amounts to be deposited in the Note Distribution Account on such
Distribution Date and allocable to principal) to reduce the outstanding
principal balance of the related class of Notes to zero.
'CLASS B NOTEHOLDERS' INTEREST CARRYOVER SHORTFALL' means (a) for the
initial Distribution Date, zero, and (b) for any other Distribution Date, the
excess of (i) the Class B Noteholders' Interest Distributable Amount for the
preceding Distribution Date, over (ii) the amount in respect of interest that
was actually deposited in the Note Distribution Account on such preceding
Distribution Date on account of interest or the Class B Notes, plus interest on
the amount of interest due but not paid to the Class B Noteholders' on the
preceding Distribution Date, to the extent permitted by law, at the Interest
Rate borne by the Class B Notes for the related Interest Accrual Period.
'CLASS B NOTEHOLDERS' INTEREST DISTRIBUTABLE AMOUNT' means, for any
Distribution Date, the sum of (x) the Class B Noteholders' Monthly Interest
Distributable Amount for such Distribution Date and (y) the Class B Noteholders'
Interest Carryover Shortfall for such Distribution Date.
'CLASS B NOTEHOLDERS' MONTHLY INTEREST DISTRIBUTABLE AMOUNT' means, for any
Distribution Date, interest accrued during the related Interest Accrual Period
at the Interest Rate borne by the Class B Notes on the outstanding principal
balance of the Class B Notes on such Distribution Date (or, in the case of the
first Distribution Date, on the Closing Date).
The 'PRINCIPAL DISTRIBUTION AMOUNT' means, for any Distribution Date, the
sum of the following amounts, without duplication, for such Distribution Date:
(i) Available Principal and (ii) Aggregate Net Losses.
Notwithstanding the foregoing, if an Event of Default has occurred and the
Notes have been accelerated, the Class B Noteholders will not be entitled to
receive any distributions in respect of interest on or principal of the Class B
Notes until the Class A Notes have been paid in full.
SUBORDINATION OF CLASS B NOTEHOLDERS; RESERVE ACCOUNT
The rights of the Class B Noteholders to be paid interest and principal
generally will be subordinated to the rights of the Class A Noteholders in the
event of defaults and delinquencies on the Receivables as provided in the Sale
and Servicing Agreement. The protection afforded to the Class A Noteholders
through subordination of the Class B Notes and the Certificates will be effected
both by the preferential rights of the Class A Noteholders both to receive
current distributions with respect to the Receivables and withdrawals from the
Reserve Account. The Reserve Account will be funded with an initial deposit by
the Seller of cash or Permitted Investments having an aggregate value of at
least the Reserve Account Initial Deposit. In addition, on each Distribution
Date, the Reserve Account will be augmented by the deposit therein of the Total
Distribution Amount remaining after the payment of the Servicing Fee, the
Administration Fee, the deposit of the Class A Noteholders' Interest
Distributable Amount, the Class B Noteholders' Interest Distributable Amount and
the Noteholders' Principal Distributable Amount in the Note Distribution
Account, and the deposit of the Certificateholders' Distributable Amount in the
Certificate Distribution Account, in each case as described above under
'--Distributions.' On each Distribution Date, any amounts on deposit in the
Reserve Account (after giving effect to deposits and withdrawals made on such
Distribution Date) in excess of the Specified Reserve Account Balance on such
Distribution Date will be released to the Seller.
Under the Sale and Servicing Agreement, on each Deposit Date, the Indenture
Trustee is required to demand a withdrawal from the amounts on deposit in the
Reserve Account, up to the Available Reserve Account Amount, in an amount equal
to the excess, if any, of the sum of the Class A Noteholders' Interest
Distributable Amount, the Class B Noteholders' Interest Distributable Amount and
the Noteholders' Principal Distributable Amount for the related Distribution
Date over the Total Distribution Amount for such Distribution Date (after the
payment of the Servicing Fee and the Administration Fee for such Distribution
Date). Amounts so withdrawn will be deposited in the Collection Account.
On each Distribution Date, the amount available in the Reserve Account (the
'AVAILABLE RESERVE ACCOUNT AMOUNT') will equal the lesser of (i) the amount on
deposit in the Reserve Account and (ii) the Specified Reserve Account Balance.
The aggregate amount withdrawn from the Reserve Account on any Deposit Date may
not exceed the Available Reserve Account Amount with respect to the related
Distribution Date.
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The Specified Reserve Account Balance on any Distribution Date will equal
% of the Pool Balance as of the related Settlement Date, but in any event
will not be less than the lesser of (i) $ ( % of the Original Pool
Balance) and (ii) the sum of (A) such Pool Balance plus (B) an amount sufficient
to pay interest on each class of Notes through its related Final Scheduled
Distribution Date at a rate equal to the sum of the related Interest Rate plus
the Servicing Fee Rate; provided, that the Specified Reserve Account Balance
will be calculated using a percentage of % on any Distribution Date
(beginning with the Distribution Date) for which the Average
Net Loss Ratio exceeds % or the Average Delinquency Percentage exceeds %.
'AGGREGATE NET LOSSES' means, for any Distribution Date, the amount equal
to (i) the aggregate principal balance of all Receivables that became Defaulted
Receivables during the related Collection Period minus (ii) the Liquidation
Proceeds allocable to principal collected during such Collection Period with
respect to any Defaulted Receivables.
'AVERAGE DELINQUENCY PERCENTAGE' means, for any Distribution Date, the
average of the Delinquency Percentages for such Distribution Date and the
preceding two Distribution Dates.
'AVERAGE NET LOSS RATIO' means, for any Distribution Date, the average of
the Net Loss Ratios for such Distribution Date and the preceding two
Distribution Dates.
'DELINQUENCY PERCENTAGE' means, for any Distribution Date, the sum of the
outstanding principal balances of all Receivables which are 60 days or more
delinquent (including Receivables, which are not Defaulted Receivables, relating
to Financed Vehicles that have been repossessed), as of the close of business on
the last day of the Collection Period immediately preceding such Distribution
Date, determined in accordance with the Servicer's normal practices, such sum
expressed as a percentage of the Pool Balance as of the close of business on the
last day of such Collection Period.
'LIQUIDATION PROCEEDS' means with respect to any Receivable, (i) insurance
proceeds, (ii) the monies collected during a Collection Period from whatever
source on a Defaulted Receivable and (iii) proceeds of a Financed Vehicle sold
after repossession, in each case net of any liquidation expenses and payments
required by law to be remitted to the Obligor.
'NET LOSS RATIO' means, for any Distribution Date, an amount expressed as a
percentage, equal to (i) the Aggregate Net Losses for such Distribution Date,
divided by (ii) the average of the Pool Balances on each of the related
Settlement Date and the last day of the related Collection Period.
The Specified Reserve Account Balance may be reduced to a lesser amount as
determined by the Seller; provided, that such reduction may not adversely affect
any rating of the Notes by a Rating Agency. Upon distribution to the Seller of
amounts from the Reserve Account, the Noteholders will not have any rights in,
or claims to, such amounts.
The availability of funds in the Reserve Account and the subordination of
amounts distributable to the Certificateholders, and in the case of the Class A
Noteholders, the subordination of amounts distributable to Class B Noteholders,
are intended to enhance the likelihood of receipt by Noteholders of the full
amount of principal and interest due them and to decrease the likelihood that
the Noteholders will experience losses. However, in certain circumstances, the
Reserve Account could be depleted. If the amount required to be withdrawn from
the Reserve Account to cover shortfalls in collections on the Receivables
exceeds the amount of available cash in the Reserve Account, Noteholders could
incur losses, or a temporary shortfall in the amounts distributed to the
Noteholders could result, which could, in turn, increase the average life of the
Notes. Such shortfalls may result from, among other things, Aggregate Net Losses
on the Receivables or the failure by the Servicer to make any remittance under
the Sale and Servicing Agreement.
ADMINISTRATION AGREEMENT
Chase, as the Administrator, will enter into the Administration Agreement
with the Trust and the Indenture Trustee pursuant to which the Administrator
will agree to provide the notices and to perform on behalf of the Trust certain
other administrative functions. As compensation for the performance of the
Administrator's
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obligations under the Administration Agreement, the Administrator will be
entitled to receive the Administration Fee.
The Administration Agreement provides that the Administrator may act
directly or through its agents or attorneys pursuant to agreements entered into
with any of them, and that the Administrator will not be liable for the conduct
or misconduct of such agents or attorneys if such agents or attorneys shall have
been selected by the Administrator with due care. Chase USA will enter into a
side agreement with the Administrator pursuant to which Chase USA will agree to
perform certain of the duties of the Administrator set forth in the
Administration Agreement and to reimburse and indemnify the Administrator for
all expenses or liabilities the Administrator may incur as a result of its
entering into the Administration Agreement.
[LEGAL INVESTMENT
The Class A-1 Notes will be eligible securities for purchase by money
market funds under paragraph (a)(9) of Rule 2a-7 under the Investment Company
Act of 1940, as amended.]
CERTAIN FEDERAL INCOME TAX CONSEQUENCES
The following is a general summary of the material United States ('U.S.')
federal income tax consequences that may be relevant to the purchase, ownership
and disposition of the Notes by an investor who purchases the Notes pursuant to
their original issuance at their original issue price. This summary is based
upon the Internal Revenue Code of 1986, as amended (the 'CODE'), the Treasury
regulations promulgated thereunder, administrative rulings or pronouncements and
judicial decisions, all as in effect on the date hereof and all of which are
subject to change, possibly retroactively. The following discussion does not
deal with all aspects of U.S. income taxation, nor does it address U.S. federal
income tax consequences that may be relevant to certain types of investors, such
as banks, insurance companies, dealers in securities, tax-exempt organizations
or persons whose functional currency is not the U.S. dollar, who may be subject
to special treatment under the Code. In addition, the following discussion does
not address the alternative minimum tax consequences of an investment in the
Notes or the consequences of such an investment under state and local tax laws
or foreign tax laws. Prospective investors should note that no rulings have been
or will be sought from the Internal Revenue Service ('IRS') with respect to any
of the U.S. federal income tax consequences discussed herein and opinions of
counsel are not binding on the IRS or the courts. Thus, no assurance can be
given that the IRS will not take positions contrary to those described below.
The opinions of Simpson Thacher & Bartlett, special counsel to the Seller
('FEDERAL TAX COUNSEL'), described herein will be based upon certain
representations and assumptions, including, but not limited to, the assumption
that all relevant parties will comply with the terms of the Trust Agreement and
related documents.
This summary is intended as an explanatory discussion of tax matters
affecting investors generally, but does not purport to furnish information in
the level of detail or with the attention to the investor's specific tax
circumstances that would be provided by an investor's own tax adviser.
Accordingly, investors should consult their own tax advisors to determine the
federal, state, local, and other tax consequences that may be relevant to their
purchase, ownership and disposition of the Notes based upon their particular
facts and circumstances.
For purposes of the following discussion, except as otherwise provided
herein, the term 'Noteholder' refers to the beneficial owner of a Note. In
addition, the discussion below assumes that Noteholders will hold their Notes as
'capital assets' within the meaning of Section 1221 of the Code.
TAX CHARACTERIZATION OF THE TRUST.
In the opinion of Federal Tax Counsel, the Trust will not be classified
as an association (or publicly traded partnership) taxable as a corporation.
This opinion is based on, among other things, certain facts and assumptions
contained in such opinion and Federal Tax Counsel's conclusion that the
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nature of the Trust's income exempts it from the rule that certain publicly
traded partnerships are taxable as corporations.
TAX CONSEQUENCES TO NOTEHOLDERS
Treatment of the Notes as Indebtedness. The Trust and the Noteholders, by
their purchase of the Notes, agree to treat the Notes as debt for all U.S. tax
purposes. In the opinion of Federal Tax Counsel, the Notes will be characterized
as debt for U.S. federal income tax purposes. The discussion below assumes this
characterization of the Notes is correct.
Interest Income on the Notes. The Notes will not be considered to have
been issued with original issue discount ('OID') in excess of the statutorily
defined de minimis amount (i.e., 1/4% of the principal amount of a Note
multiplied by its weighted average to maturity). Consequently, the stated
interest thereon will be taxable to a Noteholder as ordinary interest income at
the time it is received or accrued in accordance with such Noteholder's method
of tax accounting. Under the applicable Treasury regulations, a holder of a Note
issued with a de minimis amount of OID must include gain attributable to such
OID in income, on a pro rata basis, as principal payments are made on the Note.
A purchaser who buys a Note for more or less than its principal amount generally
will be subject, respectively, to the premium amortization or market discount
rules of the Code.
Sale or Other Disposition. If a Noteholder sells or otherwise disposes of
a Note in a taxable transaction, the former Noteholder will recognize gain or
loss in an amount equal to the difference between the amount realized on such
sale or other disposition and the former Noteholder's adjusted tax basis in the
Note. The adjusted tax basis of a Note to a particular Noteholder generally will
equal the holder's cost therefor increased by any market discount previously
included in income by such Noteholder and decreased by the amount of bond
premium (if any) previously amortized and the amount of any payments, other than
payments of stated interest, previously received by such Noteholder with respect
to such Note. Any such gain or loss will be capital gain or loss if the Note was
held as a capital asset, except to the extent such gain represents accrued
interest or accrued market discount not previously included in income. Capital
losses generally may be used only to offset capital gains.
Foreign Noteholders. For purposes of this discussion, the term 'FOREIGN
INVESTOR' means any person other than (i) a citizen or resident of the United
States, (ii) a corporation or partnership organized in or under the laws of the
United States or any political subdivision thereof, (iii) an estate, the income
of which is includible in gross income for U.S. federal income tax purposes
regardless of its source or (iv) a trust if the primary supervision over the
administration of such trust can be exercised by a court within the United
States and one or more U.S. persons have the authority to control all
substantial decisions of such trust.
Under present U.S. federal income tax law, and subject to the discussion
below concerning backup withholding:
(a) no withholding of U.S. federal income tax will be required with
respect to the payment by the Trust of principal or interest on a Note
owned by a Foreign Investor, provided that the beneficial owner of the Note
(i) is not actually or constructively a '10 percent shareholder' of the
Trust (including a holder of 10% or more of such Trust's outstanding
Certificates) or the Seller, (ii) is not a 'controlled foreign corporation'
with respect to which the Trust or the Seller is a 'related person' within
the meaning of the Code and (iii) satisfies the statement requirement
(described generally below) set forth in Section 871(h) and Section 881(c)
of the Code and the regulations thereunder; and
(b) no withholding of U.S. federal income tax will be required with
respect to any gain realized by a Foreign Investor upon the sale, exchange
or retirement of a Note provided that, in the case of any gain representing
accrued interest, the conditions described in (a) above are satisfied.
To satisfy the requirement referred to in (a)(iii) above, the beneficial
owner of such Note, or a financial institution holding the Note on behalf of
such owner, must provide, in accordance with specified procedures, the U.S.
entity that would otherwise be required to withhold U.S. taxes with a statement
to the effect that the beneficial owner is not a U.S. person. Pursuant to
current temporary Treasury regulations, these requirements will be met if (i)
the beneficial owner provides his name and address, and certifies, under
penalties of perjury that he, she or it is not a 'U.S. person' (which
certification may be made on an IRS Form W-8 or successor form), or
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(ii) a financial institution or securities clearing organization holding the
Note on behalf of such beneficial owner certifies, under penalties of perjury,
that such statement has been received by it and furnishes the U.S. entity
otherwise required to withhold U.S. taxes with a copy thereof.
If a Foreign Investor cannot satisfy the requirements of the 'portfolio
interest' exception described in (a) above, payments of premium, if any, and
interest (including OID) made to a Foreign Investor with respect to a Note will
be subject to a 30% U.S. withholding tax unless the beneficial owner of the Note
provides the U.S. entity otherwise required to withhold U.S. taxes with a
properly executed (i) IRS Form 1001 (or successor form) claiming an exemption
from withholding under the benefit of a tax treaty or (ii) IRS Form 4224 (or
successor form) stating that the interest paid on the Note is not subject to
U.S. withholding tax because such interest income is effectively connected with
the beneficial owner's conduct of a trade or business in the United States.
If a Foreign Investor is engaged in a trade or business in the United
States and premium, if any, or interest on the Note is effectively connected
with the conduct of such trade or business, the Foreign Investor, although
exempt from the U.S. withholding tax discussed above, will be subject to U.S.
federal income tax on such premium, if any, and interest on a net income basis
in the same manner as if it were a U.S. person. In addition, if such Foreign
Investor is a foreign corporation, it may be subject to a branch profits tax
equal to 30% of its effectively connected earnings and profits for the taxable
year, subject to adjustments. For this purpose, such premium, if any, and
interest on the Note will be included in such foreign corporation's
effectively connected earnings and profits.
Any gain realized by a Foreign Investor upon the sale, exchange or
retirement of a Note generally will not be subject to U.S. federal income tax
unless (i) such gain or income is effectively connected with a trade or business
conducted by the Foreign Investor in the United States and (ii) in the case of a
Foreign Investor who is an individual, such individual is present in the United
States for 183 days or more in the taxable year of such sale, exchange or
retirement, and certain other conditions are met.
Information Reporting and Backup Withholding. In general, information
reporting requirements will apply to certain payment of principal, interest and
premium, if any, paid on the Notes and to the proceeds from the sale of a Note
paid to U.S. persons, other than certain exempt recipients (such as
corporations). A 31% U.S. backup withholding tax will apply to such payments if
the U.S. person fails to provide a taxpayer identification number or
certification of foreign or other exempt status or fails to report in full
dividend and interest income.
No information reporting or backup withholding will be required with
respect to payments made by the Trust to a Foreign Investor if a statement
described in (a)(iii) above under the caption 'Foreign Noteholders' has been
received by the U.S. entity otherwise required to withhold U.S. taxes and such
entity does not have actual knowledge that the beneficial owner is a U.S.
person.
In addition, backup withholding and information reporting will not apply if
payments of principal, interest and premium (if any) on a Note are paid or
collected by a foreign office of a custodian, nominee or other foreign agent on
behalf of the beneficial owner of such Note, or if a foreign office of a broker
(as defined in applicable Treasury regulations) pays the proceeds from the sale
of a Note to the owner thereof. If, however, such nominee, custodian, agent or
broker is, for U.S. federal income tax purposes, a U.S. person, a controlled
foreign corporation or a foreign person that derives 50% or more of its gross
income for certain periods from the conduct of a trade or business in the United
States, such payments will not be subject to backup withholding but will be
subject to information reporting, unless (i) such custodian, nominee, agent or
broker has documentary evidence in its records that the beneficial owner is not
a U.S. person and certain other conditions are met or (ii) the beneficial owner
otherwise establishes an exemption. Temporary Treasury regulations provide that
the Treasury is considering whether backup withholding will apply with respect
to such payments of principal, interest or the proceeds from a sale that are not
subject to backup withholding under the current regulations. Under proposed
Treasury regulations, not currently in effect, backup withholding will not apply
to such payments absent actual knowledge that the payee is a U.S. person.
Payments of principal, interest and premium (if any) on a Note paid to the
beneficial owner of a Note by a United States office of a custodian, nominee or
agent, or the payment by the United States office of a broker of the proceeds
from the sale of a Note, will be subject to both backup withholding and
information reporting unless
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the beneficial owner (i) provides the statement referred to in (a)(iii) above
and the payor does not have actual knowledge that the beneficial owner is a U.S.
person or (ii) otherwise establishes an exemption.
Any amounts withheld under the backup withholding rules will be allowed as
a refund or a credit against such holder's U.S. federal income tax liability
provided the required information is furnished to the IRS.
Possible Alternative Classification of the Class B Notes. If, contrary to
the opinion of Federal Tax Counsel, the IRS successfully asserted that one or
more of the Class B Notes did not represent debt for U.S. federal income tax
purposes, the Class B Notes might be treated as equity interests in the Trust.
Treatment of the Class B Notes as equity interests in the Trust could have
adverse tax consequences to certain Class B Noteholders. For example, income to
Foreign Investors generally would be subject to U.S. tax and U.S. tax return
filing and withholding requirements and Class B Noteholders who are individuals
might be subject to certain limitations on their ability to deduct their
allocable share of the Trust's expenses.
CERTAIN STATE TAX CONSEQUENCES
The above discussion does not address the tax treatment of the Trust, the
Notes or the Noteholders under any state tax laws. Prospective investors are
urged to consult with their own tax advisors regarding the state tax treatment
of the Trust as well as any state tax consequences to them, particularly in the
case of financial institutions, of purchasing, holding and disposing of Notes.
ERISA CONSIDERATIONS
THE NOTES
The Employee Retirement Income Security Act of 1974, as amended ('ERISA'),
and Section 4975 of the Code, impose certain requirements on employee benefit
plans and certain other plans and arrangements, including individual retirement
accounts and annuities, Keogh plans and certain collective investment funds or
insurance company general or separate accounts in which such plans, accounts or
arrangements are invested, that are subject to the fiduciary responsibility
provisions of ERISA and/or Section 4975 of the Code (collectively, 'PLANS'), and
on persons who are fiduciaries with respect to Plans, in connection with the
investment of 'plan assets' of any Plan ('PLAN ASSETS'). ERISA generally imposes
on Plan fiduciaries certain general fiduciary requirements, including those of
investment prudence and diversification and the requirement that a Plan's
investments be made in accordance with the documents governing the Plan.
Generally, any person who has discretionary authority or control respecting the
management or disposition of Plan Assets, and any person who provides investment
advice with respect to such assets for a fee, is a fiduciary with respect to
such Plan Assets.
Subject to the considerations described below, the Notes are eligible for
purchase with Plan Assets of any Plan.
ERISA and Section 4975 of the Code prohibit a broad range of transactions
involving Plan Assets and persons ('PARTIES IN INTEREST' under ERISA and
'DISQUALIFIED PERSONS' under the Code) who have certain specified relationships
to a Plan or its Plan Assets, unless a statutory or administrative exemption is
available. Parties in Interest or Disqualified Persons that participate in a
prohibited transaction may be subject to a penalty imposed under ERISA and/or an
excise tax imposed pursuant to Section 4975 of the Code, unless a statutory or
administrative exemption is available. These prohibited transactions generally
are set forth in Section 406 of ERISA and Section 4975 of the Code.
Any fiduciary or other Plan investor considering whether to purchase the
Notes with Plan Assets of any Plan should determine whether such purchase is
consistent with its fiduciary duties and whether such purchase would constitute
or result in a non-exempt prohibited transaction under ERISA and/or Section 4975
of the Code because any of the Seller, the Servicer, the Trust (by reason of the
[Seller's] ownership of the certificates), the Indenture Trustee, the Owner
Trustee, any other Certificateholder or any other parties may be deemed to be
benefiting from the issuance of the Notes and may be Parties in Interest or
Disqualified Persons with respect to the investing Plan. Any fiduciary or other
Plan investor considering whether to purchase the Notes should consult with its
counsel regarding the applicability of the fiduciary responsibility and
prohibited transaction provisions of ERISA and
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Section 4975 of the Code to such investment, and particularly if the Seller, the
Servicer or the Trust is a Party in Interest or Disqualified Person with respect
to the investing Plan, the availability of exemptive relief under any prohibited
transaction exemption, e.g., DOL Prohibited Transaction Exemptions 96-23
(relating to transactions determined by 'in-house asset managers'), 95-60
(relating to transactions involving insurance company general accounts), 91-38
(relating to transactions involving bank collective investment funds), 90-1
(relating to transactions involving insurance company pooled separate accounts)
and 84-14 (relating to transactions determined by independent 'qualified
professional asset managers'). A purchaser of the Notes should be aware,
however, that even if the conditions specified in one or more of those
exemptions are met, the scope of the exemptive relief provided by the exemption
might not cover all acts which might be construed as prohibited transactions.
In addition, under U.S. Department of Labor Regulation Section 2510.3-101
(the 'PLAN ASSET REGULATION'), the purchase with Plan Assets of equity interests
in the Trust could, in certain circumstances, cause the Receivables and other
assets of the Trust to be deemed Plan Assets of the investing Plan which, in
turn, would subject the Trust and its assets to the fiduciary responsibility
provisions of ERISA and the prohibited transaction provisions of ERISA and
Section 4975 of the Code. Nevertheless, because the Notes (a) should be treated
as indebtedness under local law and debt, rather than equity, for tax purposes
(see 'Certain Federal Income Tax Considerations--Tax Consequences to
Noteholders--Treatment of the Notes as Indebtedness' herein), and (b) should not
be deemed to have any 'substantial equity features,' purchases of the Notes with
Plan Assets should not be treated as equity investments and, therefore, the
Receivables and other assets included as assets of the Trust should not be
deemed to be Plan Assets of the investing Plans. Those conclusions are based, in
part, upon the traditional debt features of the Notes, including the reasonable
expectation of purchasers of Notes that the Notes (which are highly rated by the
Rating Agencies) will be repaid when due, as well as the absence of conversion
rights, warrants and other typical equity features. Before purchasing the Notes,
a fiduciary or other Plan investor should itself confirm that the Notes
constitute indebtedness, and have no substantial equity features, for purposes
of the Plan Asset Regulation.
The Notes may not be purchased with Plan Assets of any Plan if any of the
Seller, the Servicer, the Indenture Trustee, the Owner Trustee or any of their
respective affiliates (a) has investment or administrative discretion with
respect to the Plan Assets used to effect such purchase; (b) has authority or
responsibility to give, or regularly gives, investment advice with respect to
such Plan Assets, for a fee and pursuant to an agreement or understanding that
such advice (1) will serve as a primary basis for investment decisions with
respect to such Plan Assets, and (2) will be based on the particular investment
needs of such Plan; or (c) is an employer maintaining or contributing to such
Plan. Each purchaser will be deemed to have represented and warranted that its
purchase of a Note or any interest therein does not violate the foregoing
limitation.
Any fiduciary or other Plan investor considering whether to purchase any
Notes on behalf of or with Plan Assets of any Plan should consult with its
counsel and refer to this Prospectus Supplement and the Prospectus for guidance
regarding the ERISA Considerations applicable to the Notes offered hereby.
For further information see 'ERISA Considerations' in the Prospectus.
[LISTING AND GENERAL INFORMATION
Application will be made to list the Notes on the Luxembourg Stock
Exchange. In connection with the listing application, the Organization
Certificate and By-laws of the Bank, as well as legal notice relating to the
issuance of the Notes will be deposited prior to listing with the Chief
Registrar of the District Court of Luxembourg, where copies thereof may be
obtained upon request. Once the Notes have been approved for listing, trading of
the Notes may be effected on the Luxembourg Stock Exchange. The Notes have been
accepted for
S-36
<PAGE>
clearance through the facilities of DTC, Cedel and Euroclear. The CUSIP numbers
and International Securities Identification Numbers (ISIN) for the Notes are as
follows:
<TABLE>
<CAPTION>
CLASS CUSIP ISIN
- - - ---------------------------------------------------------- --------- ---------
<S> <C> <C>
Class A-1.................................................
Class A-2.................................................
Class A-3.................................................
Class A-4.................................................
Class B...................................................
</TABLE>
Common Code numbers will be available upon request of any Underwriter.
The transactions contemplated in this Prospectus Supplement were authorized
by resolutions adopted by the Bank's Board of Directors as of
, 199 and by the Bank's Asset and Loan Securitization
Committee as of , 199 .
Copies of the Indenture and the Transfer and Servicing Agreements, the
annual report of independent public accountants described in 'Description of the
Transfer and Servicing Agreements--Evidence as to Compliance' in the Prospectus,
the documents listed under 'Available Information' and the reports to
Securityholders referred to under 'Reports to Securityholders' and 'Certain
Information Regarding the Securities--Reports to Securityholders' in the
Prospectus will be available free of charge at the office of Banque Generale du
Luxembourg, S.A. (the 'LISTING AGENT'), 50 Avenue J.F. Kennedy, L-2951,
Luxembourg. Financial information regarding the Bank is included in the
consolidated financial statements of The Chase Manhattan Corporation in The
Chase Manhattan Corporation's Annual Report on Form 10-K for the fiscal year
ended December 31, 1996. Such report is available, and reports for subsequent
years will be available, at the office of the Listing Agent.
So long as there is no Paying Agent and Transfer Agent in Luxembourg,
Banque Generale du Luxembourg, S.A. will act as intermediary agent in
Luxembourg. In the event that Definitive Notes are issued, a Paying Agent and
Transfer Agent will be appointed in Luxembourg.
The Notes, the Indenture and Transfer and Servicing Agreements are governed
by the laws of the State of New York (except for the Trust Agreement, which is
governed by the laws of the State of Delaware).]
S-37
<PAGE>
UNDERWRITING
Subject to the terms and conditions set forth in an underwriting agreement
(the 'UNDERWRITING AGREEMENT'), the Seller has agreed to sell to the
underwriters named below (the 'UNDERWRITERS'), and each of the Underwriters has
severally agreed to purchase, the principal amount of Notes set forth opposite
its name below:
<TABLE>
<CAPTION>
PRINCIPAL AMOUNT PRINCIPAL AMOUNT PRINCIPAL AMOUNT PRINCIPAL AMOUNT PRINCIPAL AMOUNT
UNDERWRITERS OF CLASS A-1 NOTES OF CLASS A-2 NOTES OF CLASS A-3 NOTES OF CLASS A-4 NOTES OF CLASS B NOTES
- - - -------------------- ------------------ ------------------ ------------------ ------------------ ----------------
<S> <C> <C> <C> <C> <C>
------------------ ------------------ ------------------ ------------------ ----------------
Total..........
------------------ ------------------ ------------------ ------------------ ----------------
------------------ ------------------ ------------------ ------------------ ----------------
</TABLE>
In the Underwriting Agreement, the several Underwriters have agreed,
subject to the terms and conditions therein, to purchase all the Notes offered
hereby if any of such Notes are purchased. The Seller has been advised by the
Underwriters that they propose initially to offer the Class A-1 Notes, the Class
A-2 Notes, the Class A-3 Notes, the Class A-4 Notes and the Class B Notes to the
public at the prices set forth on the cover page hereof, and to certain dealers
at such price less a concession not in excess of % of the principal amount of
the Class A-1 Notes, % of the principal amount of the Class A-2 Notes, %
of the principal amount of the Class A-3 Notes, % of the principal amount of
the Class A-4 Notes and % of the principal amount of the Class B Notes. The
Underwriters may allow, and such dealers may reallow, a concession not in excess
of % of the principal amount of the Class A-1 Notes, % of the principal
amount of the Class A-2 Notes, % of the principal amount of the Class A-3
Notes, % of the principal amount of the Class A-4 Notes and % of the
principal amount of the Class B Notes to certain other dealers. After the
initial public offering, such prices and such concessions may be changed.
The Indenture Trustee and the Owner Trustee (on behalf of the Trust) may,
from time to time, invest the funds in the Collection Account [, the Paid-Ahead
Account] and the Reserve Account in Permitted Investments acquired from any of
the Underwriters.
, on behalf of the Underwriters, may engage in
over-allotment transactions, stabilizing transactions, syndicate covering
transactions and penalty bids with respect to the Notes in accordance with
Regulation M under the Exchange Act. Over-allotment transactions involve
syndicate sales in excess of the offering size, which creates a syndicate short
position. Stabilizing transactions permit bids to purchase the Notes so long as
the stabilizing bids do not exceed a specified maximum. Syndicate covering
transactions involve purchases of the Notes in the open market after the
distribution has been completed in order to cover syndicate short positions.
Penalty bids permit to reclaim a selling concession from a
syndicate member when the Notes originally sold by such syndicate member are
purchased in a syndicate covering transaction. Such over-allotment transactions,
stabilizing transactions, syndicate covering transactions and penalty bids may
cause the prices of the Notes to be higher than they would otherwise be in the
absence of such transactions. Neither the Issuer nor any of the Underwriters
represent that will engage in any such transactions or that
such transactions, once commenced, will not be discontinued without notice.
[This Prospectus Supplement and the Prospectus may be used by Chase
Securities, Inc., an affiliate of the Seller and a subsidiary of The Chase
Manhattan Corporation, in connection with offers and sales related to
market-making transactions in the Notes. Chase Securities, Inc., may act as
principal or agent in such transactions. Such sales will be made at prices
related to prevailing market prices at the time of sale. Chase Securities, Inc.,
has no obligation to make a market in the Notes, and it may discontinue any such
market-making activities at any time without notice, in its sole discretion.
Chase Securities, Inc., is among the Underwriters participating in the initial
distribution of the Notes.]
S-38
<PAGE>
The Seller will indemnify the Underwriters against certain liabilities,
including liabilities under the Securities Act of 1933, as amended, or
contribute to payments the Underwriters may be required to make in respect
thereof.
LEGAL MATTERS
Certain legal matters relating to the issuance of the Notes will be passed
upon for the Seller by Simpson Thacher & Bartlett (a partnership that includes
professional corporations), New York, New York and certain other legal matters
will be passed upon for the Seller by , a of
, and for the Underwriters by Orrick, Herrington &
Sutcliffe LLP, New York, New York. From time to time Simpson Thacher & Bartlett
and Orrick, Herrington & Sutcliffe LLP, provide legal services to the Seller and
its affiliates.
S-39
<PAGE>
INDEX OF TERMS
[TO BE REVISED]
<TABLE>
<CAPTION>
TERM PAGE
- - - ---------------------------------------------------------------------------------------------------- ------------
<S> <C>
ABS................................................................................................. S-16
ABS Table........................................................................................... S-17
Administration Agreement............................................................................ S-5
Administration Fee.................................................................................. S-6
Administrator....................................................................................... S-5
Aggregate Net Losses................................................................................ S-29
Available Interest.................................................................................. S-27
Available Principal................................................................................. S-27
Available Reserve Account Amount.................................................................... S-29
Average Delinquency Percentage...................................................................... S-29
Average Net Loss Ratio.............................................................................. S-29
Bank................................................................................................ S-1
Business Day........................................................................................ S-3
Cedel............................................................................................... i
Certificate Balance................................................................................. S-27
Certificate Final Scheduled Distribution Date....................................................... S-29
Certificate Rate.................................................................................... S-2
Certificateholders.................................................................................. ii
Certificateholders' Distributable Amount............................................................ S-7
Certificateholders' Interest Carryover Shortfall.................................................... S-27
Certificateholders' Interest Distributable Amount................................................... S-27
Certificateholders' Monthly Interest Distributable Amount........................................... S-27
Certificateholders' Monthly Principal Distributable Amount.......................................... S-27
Certificateholders' Principal Carryover Shortfall................................................... S-27
Certificateholders' Principal Distributable Amount.................................................. S-27
Certificates........................................................................................ ii, S-2
Chase...............................................................................................
Chase USA........................................................................................... S-1
Class A Noteholders................................................................................. ii, S-5
Class A Noteholders' Interest Carryover Shortfall................................................... S-28
Class A Noteholders' Interest Distributable Amount.................................................. S-28
Class A Noteholders' Monthly Interest Distributable Amount.......................................... S-28
Class A Notes....................................................................................... ii
Class A-1 Final Scheduled Distribution Date......................................................... S-4
Class A-1 Notes..................................................................................... ii
Class A-2 Final Scheduled Distribution Date......................................................... S-4
Class A-2 Notes..................................................................................... ii
Class A-3 Final Scheduled Distribution Date......................................................... S-4
Class A-3 Notes..................................................................................... ii
Class A-4 Final Scheduled Distribution Date......................................................... S-4
Class A-4 Notes..................................................................................... ii
Class B Final Scheduled Distribution Date........................................................... S-4
Class B Noteholders................................................................................. ii
Class B Noteholders' Interest Carryover Shortfall................................................... S-27
Class B Noteholders' Interest Distributable Amount.................................................. S-28
Class B Noteholders' Monthly Interest Distributable Amount.......................................... S-28
Class B Notes....................................................................................... ii
Closing Date........................................................................................ i
Code................................................................................................ S-30
Collection Account.................................................................................. S-5
Collection Period................................................................................... S-6
</TABLE>
S-40
<PAGE>
<TABLE>
<CAPTION>
TERM PAGE
- - - ---------------------------------------------------------------------------------------------------- ------------
<S> <C>
Contract Rate....................................................................................... S-9
Controlling Notes................................................................................... S-24
Cutoff Date......................................................................................... ii
Delinquency Percentage.............................................................................. S-29
Direct Receivables.................................................................................. S-12
Disqualified Persons................................................................................ S-34
Distribution Date................................................................................... ii
DTC................................................................................................. i
ERISA............................................................................................... S-39
Euroclear........................................................................................... i
FDIC................................................................................................ i
Federal Tax Counsel................................................................................. S-31
Final Scheduled Distribution Date................................................................... S-4
Final Scheduled Maturity Date....................................................................... S-2
Financed Vehicles................................................................................... S-2
Foreign Investor.................................................................................... S-32
Indenture........................................................................................... S-1
Indenture Trustee................................................................................... S-1
Interest Accrual Period............................................................................. S-3
Interest Rates...................................................................................... S-3
IRS................................................................................................. S-31
Issuer.............................................................................................. S-1
Late Fees........................................................................................... S-25
Liquidation Proceeds................................................................................ S-30
Net Loss Ratio...................................................................................... S-30
Note Distribution Account........................................................................... S-25
Noteholders......................................................................................... ii
Noteholders' Monthly Principal Distributable Amount................................................. S-28
Noteholders' Principal Carryover Shortfall.......................................................... S-28
Noteholders' Principal Distributable Amount......................................................... S-28
Notes............................................................................................... iii
OID................................................................................................. S-31
Original Pool Balance............................................................................... S-2
Owner Trustee....................................................................................... S-1
Paid-Ahead.......................................................................................... S-26
Parties in Interest................................................................................. S-34
Paying Agent........................................................................................ S-25
Plan Asset Regulation............................................................................... S-34
Plan Assets......................................................................................... S-34
Plans............................................................................................... S-34
Pool Balance........................................................................................ S-2
Principal Distribution Amount....................................................................... S-28
Rating Agency....................................................................................... S-6
Receivables Pool.................................................................................... S-8
Record Date......................................................................................... S-3
Reserve Account..................................................................................... S-4
Reserve Account Initial Deposit..................................................................... S-4
Sale and Servicing Agreement........................................................................ S-2
Securities.......................................................................................... ii
Seller.............................................................................................. i, S-1
Servicer............................................................................................ ii, S-1
Servicing Fee Rate.................................................................................. S-25
Settlement Date..................................................................................... S-5
</TABLE>
S-41
<PAGE>
<TABLE>
<CAPTION>
TERM PAGE
- - - ---------------------------------------------------------------------------------------------------- ------------
<S> <C>
Specified Reserve Account Balance................................................................... S-5
Total Distribution Amount........................................................................... S-26
Transfer and Servicing Agreements................................................................... S-24
Trust............................................................................................... i, S-1
Trust Account....................................................................................... S-25
Trust Agreement..................................................................................... S-1
U.S................................................................................................. S-30
Underwriters........................................................................................ S-36
Underwriting Agreement.............................................................................. S-36
</TABLE>
S-42
<PAGE>
ANNEX A
GLOBAL CLEARANCE, SETTLEMENT AND
TAX DOCUMENTATION PROCEDURES
Except in certain limited circumstances, the globally offered Chase
Manhattan Auto Trust 199 - Class A-1 % Asset Backed Notes, Class A-2 %
Asset Backed Notes, Class A-3 % Asset Backed Notes, Class A-4 % Asset
Backed Notes and Class B % Asset Backed Notes (the 'GLOBAL NOTES') to be
issued will be available only in book-entry form. Investors may hold Global
Notes through any of DTC, Cedel or Euroclear. The Global Notes will be tradeable
as home market instruments in both the European and U.S. domestic markets.
Initial settlement and all secondary trades will settle in same-day funds.
Secondary market trading between investors holding Global Notes through
Cedel and Euroclear will be conducted in the ordinary way in accordance with
their normal rules and operating procedures and in accordance with conventional
eurobond practice (i.e., seven calendar day settlement).
Secondary market trading between investors holding Global Notes through DTC
will be conducted according to the rules and procedures applicable to U.S.
corporate debt obligations.
Secondary cross-market trading between Cedel or Euroclear and DTC
Participants holding Global Notes will be effected on a delivery-against-payment
basis through the respective Depositaries of Cedel and Euroclear (in such
capacity) and as DTC Participants.
Non-U.S. holders (as described below) of Global Notes will be subject to
U.S. withholding taxes unless such holders meet certain requirements and deliver
appropriate U.S. tax documents to the securities clearing corporation
organizations or their participants.
INITIAL SETTLEMENT
All Global Notes will be held in book-entry form by DTC in the name of Cede
& Co. as nominee or DTC. Investors' interests in the Global Notes will be
represented through financial institutions acting on their behalf as direct and
indirect Participants in DTC. As a result, Cedel and Euroclear will hold
positions on behalf of their participants through their respective Depositaries,
which in turn will hold such positions in accounts as DTC Participants.
Investors electing to hold their Global Notes through DTC will follow the
settlement practice applicable to U.S. corporate debt obligations. Investor
securities custody accounts will be credited with the holdings against payment
in same-day funds on the settlement date.
Investors electing to hold their Global Notes through Cedel or Euroclear
accounts will follow the settlement procedures applicable to conventional
eurobonds, except that there will be no temporary global security and no
'lock-up' or restricted period. Global Notes will be credited to the securities
custody accounts on the settlement date against payment in same-day funds.
SECONDARY MARKET TRADING
Since the purchaser determines the place of delivery, it is important to
establish at the time of the trade where both the purchaser's and seller's
accounts are located to ensure that settlement can be made on the desired value
date.
Trading between DTC Participants. Secondary market trading between DTC
Participants will be settled using the procedures applicable to U.S. corporate
debt obligations in same-day funds.
Trading between Cedel and/or Euroclear Participants. Secondary market
trading between Cedel Participants or Euroclear Participants will be settled
using the procedures applicable to conventional eurobonds in same-day funds.
Trading between DTC seller and Cedel or Euroclear purchaser. When Global
Notes are to be transferred from the account of a DTC Participant to the account
of a Cedel Participant or a Euroclear Participant, the
S-A-1
<PAGE>
purchaser will send instructions to Cedel or Euroclear, through a Cedel
Participant or Euroclear Participant, at least one business day prior to
settlement. Cedel or Euroclear will instruct the respective Depositary to
receive the Global Notes against payment. Payment will include interest accrued
on the Global Notes from and including the last coupon payment date to and
excluding the settlement date. Payment will then be made by the respective
Depositary to the DTC Participant's account against delivery of the Global
Notes. After settlement has been completed, the Global Notes will be credited to
the respective clearing system and by the clearing system, in accordance with
its usual procedures, to the Cedel Participant's or Euroclear Participant's
account. The Global Notes credit will appear the next day (European time) and
the cash debit will be backed-valued to, and the interest on the Global Notes
will accrue from, the value date (which would be the preceding day when
settlement occurred in New York). If settlement is not completed on the intended
value date (i.e., the trade fails), the Cedel or Euroclear cash debit will be
valued instead as of the actual settlement date.
Cedel Participants and Euroclear Participants will need to make available
to the respective clearing systems the funds necessary to process same-day funds
settlement. The most direct means of doing so is to preposition funds for
settlement, either from cash on hand or existing lines of credit, as they would
for any settlement occurring within Cedel or Euroclear. Under this approach,
they may take on credit exposure to Cedel or Euroclear until the Global Notes
are credited to their accounts one day later.
As an alternative, if Cedel or Euroclear has extended a line of credit to
them, Cedel Participants or Euroclear Participants can elect not to preposition
funds and allow that credit line to be drawn upon the finance settlement. Under
this procedure, Cedel Participants or Euroclear Participants purchasing Global
Notes would incur overdraft charges for one day, assuming they cleared the
overdraft when the Global Notes were credited to their accounts. However,
interest on the Global Notes would accrue from the value date. Therefore, in
many cases the investment income on the Global Notes earned during the one-day
period may substantially reduce or offset the amount of such overdraft charges,
although this result will depend on each Cedel Participant's or Euroclear
Participant's particular cost of funds.
Since the settlement is taking place during New York business hours, DTC
Participants can employ their usual procedures for sending Global Notes to the
respective Depositary for the benefit of Cedel Participants or Euroclear
Participants. The sale proceeds will be available to the DTC seller on the
settlement date. Thus, to the DTC Participant a cross-market transaction will
settle no differently than a trade between two DTC Participants.
Trading between Cedel or Euroclear seller and DTC purchaser. Due to time
zone differences in their favor, Cedel Participants and Euroclear Participants
may employ their customary procedures for transactions in which Global Notes are
to be transferred by the respective clearing system, through the respective
Depositary, to a DTC Participant. The seller will send instructions to Cedel or
Euroclear, through a Cedel Participant or Euroclear Participant, at least one
business day prior to settlement. In these cases, Cedel or Euroclear will
instruct the respective Depositary, as appropriate, to deliver the bonds to the
DTC Participant's account against payment. Payment will include interest accrued
on the Global Notes from and including the last coupon payment date to and
excluding the settlement date. The payment will then be reflected in the account
of the Cedel Participant or Euroclear Participant the following day, and receipt
of the cash proceeds in the Cedel Participant's or Euroclear Participant's
account would be back-valued to the value date (which would be the preceding
day, when settlement occurred in New York). Should the Cedel Participant or
Euroclear Participant have a line of credit with its respective clearing system
and elect to be in debit in anticipation of receipt of the sale proceeds in its
account, the back-valuation will extinguish any overdraft charges incurred over
that one-day period. If settlement is not completed on the intended value date
(i.e., the trade fails), receipt of the cash proceeds in the Cedel Participant's
or Euroclear Participant's account would instead be valued as of the actual
settlement date.
Finally, day traders that use Cedel or Euroclear and that purchase Global
Notes from DTC Participants for delivery to Cedel Participants or Euroclear
Participants should note that these trades would automatically fail on the sale
side unless affirmative action were taken. At least three techniques should be
readily available to eliminate this potential problem:
(a) borrowing through Cedel or Euroclear for one day (until the
purchase side of the day trade is reflected in their Cedel or Euroclear
accounts) in accordance with the clearing system's custom procedures;
S-A-2
<PAGE>
(b) borrowing the Global Notes in the U.S. from a DTC Participant no
later than one day prior to settlement, which would give the Global Notes
sufficient time to be reflected in their Cedel or Euroclear account in
order to settle the sale side of the trade; or
(c) staggering the value dates for the buy and sell sides of the trade
so that the value date for the purchase from the DTC Participant is at
least one day prior to the value date for the sale to the Cedel Participant
or Euroclear Participant.
CERTAIN U.S. FEDERAL INCOME TAX DOCUMENTATION REQUIREMENTS
A beneficial owner of Global Notes holding securities through Cedel or
Euroclear (or through DTC if the holder has an address outside the U.S.) will be
subject to the 30% U.S. withholding tax that generally applies to payments of
interest (including original issue discount) on registered debt issued by U.S.
Persons, unless (i) each clearing system, bank or other financial institution
that holds customers' securities in the ordinary course of its trade or business
in the chain of intermediaries between such beneficial owner and the U.S. entity
required to withhold tax complies with applicable certification requirements and
(ii) such beneficial owner takes one of the following steps to obtain an
exemption or reduced tax rate:
Exemption for non-U.S. Persons (Form W-8). Beneficial owners of the
Global Notes that are non-U.S. Persons can obtain a complete exemption from
the withholding tax by filing a signed Form W-8 (Certificate of Foreign
Status). If the information shown on Form W-8 changes, a new Form W-8 must
be filed within 30 days of such change.
Exemption for non-U.S. Persons with effectively connected income (Form
4224). A non-U.S. Person, including a non-U.S. corporation or bank with a
U.S. branch, for which the interest income is effectively connected with
its conduct of a trade or business in the United States, can obtain an
exemption from the withholding tax by filing Form 4224 (Exemption from
Withholding of Tax on Income Effectively Connected with the Conduct of a
Trade or Business in the United States).
Exemption or reduced rate for non-U.S. Persons resident in treaty
countries (Form 1001). Non-U.S. Persons that are beneficial owners of
Global Notes and who reside in a country that has a tax treaty with the
United States can obtain an exemption or reduced tax rate (depending on the
treaty terms) by filing Form 1001 (Ownership, Exemption of Reduced Rate
Certificate). If the treaty provides only for a reduced rate, withholding
tax will be imposed at that rate unless the filer alternatively files Form
W-8. Form 1001 may be filed by such beneficial owner or his agent.
Exemption for U.S. Persons (Form W-9). U.S. Persons can obtain a
complete exemption from the withholding tax by filing Form W-9 (Payer's
Request for Taxpayer Identification Number and Certification).
U.S. Federal Income Tax Reporting Procedure. The beneficial owner of
a Global Note or, in the case of a Form 1001 or a Form 4224 filer, his
agent, files by submitting the appropriate form to the person through whom
it holds (the clearing agency, in the case of persons holding directly on
the books of the clearing agency). Form W-8 and Form 1001 are effective for
three calendar years and Form 4224 is effective for one calendar year.
The term 'U.S. Person' means (i) a citizen or resident of the United
States, (ii) a corporation or partnership organized in or under the laws of the
United States or any political subdivision thereof, (iii) an estate the income
of which is includible in gross income for United States tax purposes regardless
of its source or (iv) a trust if a court within the United States is able to
exercise primary supervision over the administration of such trust and one or
more United States fiduciaries have the authority to control all substantial
decisions of such trust. This summary does not deal with all aspects of U.S.
federal income tax withholding that may be relevant to foreign holders of the
Global Notes. Investors are advised to consult their own tax advisors for
specific tax advice concerning their holding and disposing of the Global Notes.
S-A-3
[TO BE INSERTED IF NOTES ARE LISTED ON
THE LUXEMBOURG STOCK EXCHANGE]
PRINCIPAL OFFICE OF
CHASE MANHATTAN BANK USA, NATIONAL ASSOCIATION
802 Delaware Avenue
Wilmington, Delaware 19801
OWNER TRUSTEE
INDENTURE TRUSTEE
PAYING AGENT AND TRANSFER AGENT
The Chase Manhattan Bank
450 West 33rd Street
New York, New York 10036
LISTING AND INTERMEDIARY AGENT
Banque Generale du Luxembourg, S.A.
50 Avenue J.F. Kennedy
L-2951 Luxembourg
LEGAL ADVISOR TO THE SELLER
AS TO UNITED STATES LAW
Simpson Thacher & Bartlett
425 Lexington Avenue
New York, New York 10017
LEGAL ADVISOR TO THE UNDERWRITERS
AS TO UNITED STATES LAW
Orrick, Herrington & Sutcliffe LLP
666 Fifth Avenue
New York, New York 10103
INDEPENDENT ACCOUNTANTS TO THE SELLER
Price Waterhouse LLP
1177 Avenue of the Americas
New York, New York 10036
<PAGE>
------------------------------------------------------
------------------------------------------------------
NO DEALER, SALESPERSON OR OTHER PERSON HAS BEEN AUTHORIZED TO GIVE ANY
INFORMATION OR TO MAKE ANY REPRESENTATIONS NOT CONTAINED IN THIS PROSPECTUS
SUPPLEMENT AND THE PROSPECTUS AND, IF GIVEN OR MADE, SUCH INFORMATION OR
REPRESENTATIONS MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE SELLER,
THE SERVICER OR BY THE UNDERWRITERS. NEITHER THE DELIVERY OF THIS PROSPECTUS
SUPPLEMENT OR THE PROSPECTUS NOR ANY SALE MADE HEREUNDER SHALL, UNDER ANY
CIRCUMSTANCES, CREATE AN IMPLICATION THAT THERE HAS BEEN NO CHANGE IN THE
AFFAIRS OF THE SELLER, THE SERVICER OR THE RECEIVABLES SINCE THE DATE HEREOF OR
THEREOF. THIS PROSPECTUS SUPPLEMENT AND THE PROSPECTUS DO NOT CONSTITUTE AN
OFFER OR A SOLICITATION BY ANYONE IN ANY STATE IN WHICH SUCH OFFER OR
SOLICITATION IS NOT AUTHORIZED OR IN WHICH THE PERSON MAKING SUCH OFFER OR
SOLICITATION IS NOT QUALIFIED TO DO SO OR TO ANYONE TO WHOM IT IS UNLAWFUL TO
MAKE SUCH OFFER OR SOLICITATION.
- - - ------------------------------------------------------
TABLE OF CONTENTS
<TABLE>
<S> <C>
Prospectus Supplement......................................... i
Summary of Terms.............................................. S-1
Risk Factors.................................................. S-7
The Trust..................................................... S-8
The Receivables Pool.......................................... S-9
Chase USA..................................................... S-16
Use of Proceeds............................................... S-16
Weighted Average Life of the Notes............................ S-16
Description of the Notes...................................... S-23
Description of the Transfer and Servicing
Agreements.................................................. S-26
Legal Investment.............................................. S-32
Certain Federal Income Tax Consequences....................... S-32
Certain State Tax Consequences................................ S-35
ERISA Considerations.......................................... S-35
Listing and General Information............................... S-36
Underwriting.................................................. S-38
Legal Matters................................................. S-39
Index of Terms................................................ S-40
Annex A....................................................... S-A-1
Prospectus.................................................... 1
Summary of Prospectus......................................... 6
Risk Factors.................................................. 13
The Trusts.................................................... 16
The Receivables Pools......................................... 17
Weighted Average Life of the Securities....................... 23
Pool Factors and Trading Information.......................... 25
Use of Proceeds............................................... 25
Chase USA..................................................... 26
Description of the Notes...................................... 26
Description of the Certificates............................... 31
Certain Information Regarding the Securities.................. 32
Description of the Transfer and Servicing
Agreements.................................................. 39
Certain Legal Aspects of the Receivables...................... 51
ERISA Considerations.......................................... 53
Plan of Distribution.......................................... 54
Ratings....................................................... 55
Legal Matters................................................. 55
Index of Terms................................................ 56
</TABLE>
UNTIL , 199 (90 DAYS AFTER THE DATE OF THIS PROSPECTUS SUPPLEMENT),
ALL DEALERS EFFECTING TRANSACTIONS IN THE SECURITIES, WHETHER OR NOT
PARTICIPATING IN THIS DISTRIBUTION, MAY BE REQUIRED TO DELIVER THIS PROSPECTUS
SUPPLEMENT AND THE PROSPECTUS. THIS DELIVERY REQUIREMENT IS IN ADDITION TO THE
OBLIGATION OF DEALERS TO DELIVER THIS PROSPECTUS SUPPLEMENT AND THE PROSPECTUS
WHEN ACTING AS UNDERWRITERS AND WITH RESPECT TO THEIR UNSOLD ALLOTMENTS OR
SUBSCRIPTIONS.
------------------------------------------------------
------------------------------------------------------
------------------------------------------------------
------------------------------------------------------
PROSPECTUS SUPPLEMENT
$
CHASE MANHATTAN AUTO
OWNER TRUST 199 -
$ % CLASS A-1
ASSET BACKED NOTES
$ % CLASS A-2
ASSET BACKED NOTES
$ % CLASS A-3
ASSET BACKED NOTES
$ % CLASS A-4
ASSET BACKED NOTES
$ % CLASS B
ASSET BACKED NOTES
CHASE MANHATTAN BANK USA,
NATIONAL ASSOCIATION
SELLER AND SERVICER
Underwriters of the Notes
Underwriter of the Certificates
, 199
------------------------------------------------------
------------------------------------------------------
<PAGE>
INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A
REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR MAY
OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT BECOMES
EFFECTIVE AND WITHOUT DELIVERY OF A FINAL PROSPECTUS SUPPLEMENT AND ACCOMPANYING
PROSPECTUS. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR THE
SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE SECURITIES
IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE UNLAWFUL PRIOR
TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF ANY SUCH STATE.
SUBJECT TO COMPLETION, DATED SEPTEMBER 29, 1997
PROSPECTUS
CHASE MANHATTAN AUTO TRUSTS
ASSET BACKED NOTES
ASSET BACKED CERTIFICATES
AUTOMOBILE LOAN PASS-THROUGH CERTIFICATES
CHASE MANHATTAN BANK USA, NATIONAL ASSOCIATION
SELLER AND SERVICER
- - - --------------------------------------------------------------------------------
The Asset Backed Notes (the 'NOTES') and the Asset Backed Certificates and the
Automobile Loan Pass-Through Certificates (collectively, the 'CERTIFICATES' and,
together with the Notes, the 'SECURITIES') described herein may be sold from
time to time in one or more series, in amounts, at prices and on terms to be
determined at the time of sale and to be set forth in a supplement to this
Prospectus (a 'PROSPECTUS SUPPLEMENT'). Each series of Securities, which may
include one or more classes of Notes and/or one or more classes of Certificates,
will be issued by a trust to be formed on or before the issuance date for that
series (each, a 'TRUST'). Each Trust will be formed pursuant to either a Trust
Agreement to be entered into among Chase Manhattan Bank USA, National
Association ('CHASE USA'), a national banking association headquartered in
Delaware (in such capacity, the 'SELLER'), and the owner trustee specified in
the related Prospectus Supplement or a Pooling and Servicing Agreement to be
entered into among the trustee specified in the related Prospectus Supplement,
the Seller and Chase USA, as Servicer (in such capacity, the 'SERVICER'). If a
series of Securities includes Notes, such Notes will be issued and secured
pursuant to an Indenture between the related Trust and the indenture trustee
specified in the related Prospectus Supplement and will represent indebtedness
of the related Trust. The Certificates of a series will represent fractional
undivided interests in the related Trust. The related Prospectus Supplement will
specify which class or classes of Notes, if any, and which class or classes of
Certificates, if any, of the related series are being offered thereby.
The property of each Trust will include a pool of retail installment sales
contracts and purchase money notes or other notes secured by new or used
automobiles or light-duty trucks, certain monies due or received thereunder on
and after the applicable Cutoff Date set forth in the related Prospectus
Supplement, security interests in the vehicles financed thereby, proceeds from
claims on certain insurance policies and certain other property, all as
described herein and in the related Prospectus Supplement. In addition, if so
specified in the related Prospectus Supplement, the property of a Trust will
include monies on deposit in a trust account (the 'PRE-FUNDING ACCOUNT') which
will be used to purchase additional retail installment sales contracts and
purchase money loans and related property from the Seller from time to time
during the period (the 'FUNDING PERIOD') specified in the related Prospectus
Supplement.
Except as otherwise provided in the related Prospectus Supplement, each class of
Securities of any series will represent the right to receive a specified amount
of payments of principal and interest on the related Receivables, at the rates,
on the dates and in the manner described herein and in the related Prospectus
Supplement. If a series includes multiple classes of securities, the rights of
one or more classes of Securities to receive payments may be senior or
subordinate to the rights of one or more of the other classes of such series to
the extent described herein
(continued on the following page)
- - - --------------------------------------------------------------------------------
ANY NOTES OF A SERIES REPRESENT OBLIGATIONS OF, AND THE CERTIFICATES OF A SERIES
REPRESENT BENEFICIAL INTERESTS IN, THE RELATED TRUST ONLY AND DO NOT REPRESENT
OBLIGATIONS OF OR INTERESTS IN THE CHASE MANHATTAN BANK, CHASE MANHATTAN BANK
USA, NATIONAL ASSOCIATION OR ANY AFFILIATE THEREOF. NO NOTE OR CERTIFICATE OF
ANY SERIES IS A DEPOSIT AND NO SUCH NOTE OR CERTIFICATE IS INSURED BY THE
FEDERAL DEPOSIT INSURANCE CORPORATION (THE 'FDIC'). THE RECEIVABLES ARE NOT
INSURED OR GUARANTEED BY THE FDIC OR ANY OTHER GOVERNMENTAL AGENCY.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
- - - --------------------------------------------------------------------------------
PROSPECTIVE INVESTORS SHOULD CONSIDER, AMONG OTHER THINGS, THE INFORMATION SET
FORTH UNDER THE HEADING 'RISK FACTORS' IN THIS PROSPECTUS COMMENCING ON PAGE 13
HEREIN AND SET FORTH UNDER THE HEADING 'RISK FACTORS' IN THE RELATED PROSPECTUS
SUPPLEMENT.
Retain this Prospectus for future reference. This Prospectus may not be used to
consummate sales of securities offered hereby unless accompanied by a Prospectus
Supplement.
THE DATE OF THIS PROSPECTUS IS , 1997.
<PAGE>
(continued from previous page)
and in the related Prospectus Supplement. Distributions on Certificates of a
class may be subordinated to distributions to be made on Certificates of a
different class of the same series or to payments due on any related Notes to
the extent described herein and in the related Prospectus Supplement. A series
may include one or more classes of Notes and/or Certificates which differ as to
the timing and priority of payment, interest rate or amount of distributions in
respect of principal or interest or both. A series may include one or more
classes of Notes and/or Certificates entitled to distributions in respect of
principal with disproportionate, nominal or no interest distributions, or to
interest distributions, with disproportionate, nominal or no distribution in
respect of principal. The rate of payment in respect of principal of any class
of Notes and distributions in respect of the Certificate Balance (as defined
herein) of any class of Certificates will depend on the priority of payment of
such class and the rate and timing of payments (including prepayments, defaults,
liquidations and repurchases of Receivables) on the related Receivables. A rate
of payment lower than that anticipated may affect the weighted average life of
each class of Securities in the manner described herein and in the related
Prospectus Supplement.
Each series or classes of Securities offered hereby will be rated in one of
the four highest rating categories by at least one nationally recognized
statistical rating organization.
AVAILABLE INFORMATION
Chase USA has filed with the Securities and Exchange Commission (the
'COMMISSION') a Registration Statement (together with all amendments and
exhibits thereto, referred to herein as the 'REGISTRATION STATEMENT') under the
Securities Act of 1933, as amended (the 'SECURITIES ACT'), with respect to the
Notes and the Certificates offered pursuant to this Prospectus. For further
information, reference is made to the Registration Statement and any reports and
other documents incorporated herein by reference as described below under
'Incorporation of Certain Documents by Reference,' which may be inspected and
copied at the public reference facilities maintained by the Commission at 450
Fifth Street, N.W., Washington, D.C. 20549; and at the Commission's regional
offices at Northwestern Atrium Center, 500 West Madison Street, 14th Floor,
Chicago, Illinois 60661 and Seven World Trade Center, New York, New York 10048.
Copies of the Registration Statement may be obtained from the Public Reference
Section of the Commission at 450 Fifth Street, N.W., Washington, D.C. 20549, at
prescribed rates. The Servicer, on behalf of each Trust, will also file or cause
to be filed with the Commission such periodic reports as are required under the
Securities Exchange Act of 1934, as amended (the 'EXCHANGE ACT'), and the rules
and regulations of the Commission thereunder. In addition, the Commission
maintains a public access site on the Internet through the World Wide Web, at
which site reports, information statements and other information, including all
electronic filings, regarding the Seller may be viewed. The Internet address of
such World Wide Web site is http://www.sec.gov.
REPORTS TO SECURITYHOLDERS
Unless otherwise provided in the related Prospectus Supplement, unless and
until Definitive Securities are issued, unaudited monthly and annual reports
containing information concerning each Trust and prepared by the Servicer will
be sent on behalf of each Trust only to Cede & Co. ('CEDE'), as the nominee of
The Depository Trust Company ('DTC'), and registered holder of the Securities.
See 'Certain Information Regarding the Securities--Book-Entry Registration,'
'--Definitive Securities' and '--Reports to Securityholders.' Such reports will
not constitute financial statements prepared in accordance with United States
generally accepted accounting principles or that have been examined and reported
upon by, with an opinion expressed by, an independent public or certified public
accountant. The Seller does not intend to send any of its financial reports to
Securityholders or to the owners of beneficial interests in the Securities.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
All documents filed by the Servicer with the Commission, on behalf of each
Trust, pursuant to Section 13(a), 13(c), 14 or 15(d) of the Exchange Act,
subsequent to the date of this Prospectus and prior to the termination of the
offering of the Securities shall be deemed to be incorporated by reference in
this Prospectus
2
<PAGE>
and to be part hereof. Any statement contained herein or in a document
incorporated or deemed to be incorporated by reference herein shall be deemed to
be modified or superseded for purposes of this Prospectus to the extent that a
statement contained herein or in any subsequently filed document which also is
or is deemed to be incorporated by reference herein modifies or supersedes such
statement. Any such statement so modified or superseded shall not be deemed,
except as so modified or superseded, to constitute a part of this Prospectus.
The Chase Manhattan Bank, an affiliate of the Servicer, will provide
without charge to each person to whom a copy of this Prospectus is delivered, on
the written or oral request of any such person, a copy of any or all of the
documents incorporated herein or in any related Prospectus Supplement by
reference, except the exhibits to such documents (unless such exhibits are
specifically incorporated by reference in such documents). Requests for such
copies should be directed to the Servicer, Attention: Investor Relations.
Telephone requests for such copies should be directed to the Servicer at (212)
270-6000.
3
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
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<S> <C>
SUMMARY OF PROSPECTUS................................................... 6
RISK FACTORS............................................................ 13
Certain Legal Aspects................................................. 13
Trust's Relationship to the Seller, the Servicer and their
Affiliates......................................................... 14
Subordination......................................................... 14
Limited Assets........................................................ 14
Maturity and Prepayment Considerations................................ 15
Risk of Commingling................................................... 15
Risks Associated with Subsequent Receivables and the Pre-Funding
Account............................................................ 15
Rights of Noteholders and Certificateholders.......................... 16
THE TRUSTS.............................................................. 16
THE RECEIVABLES POOLS................................................... 17
General............................................................... 17
Delinquency and Loan Loss Information................................. 19
Origination and Servicing of Motor Vehicle Loans...................... 20
Underwriting of Motor Vehicle Loans................................... 21
Insurance and Collection Procedures................................... 22
WEIGHTED AVERAGE LIFE OF THE SECURITIES................................. 23
POOL FACTORS AND TRADING INFORMATION.................................... 25
USE OF PROCEEDS......................................................... 25
CHASE USA............................................................... 26
DESCRIPTION OF THE NOTES................................................ 26
General............................................................... 26
Principal and Interest on the Notes................................... 26
The Indenture......................................................... 27
Certain Covenants..................................................... 29
The Indenture Trustee................................................. 30
DESCRIPTION OF THE CERTIFICATES......................................... 31
General............................................................... 31
Distributions of Principal and Interest............................... 31
The Trustee........................................................... 31
CERTAIN INFORMATION REGARDING THE SECURITIES............................ 32
Fixed Rate Securities................................................. 32
Floating Rate Securities.............................................. 32
Indexed Securities.................................................... 33
Book-Entry Registration............................................... 33
Definitive Securities................................................. 36
List of Securityholders............................................... 37
Reports to Securityholders............................................ 37
DESCRIPTION OF THE TRANSFER AND SERVICING AGREEMENTS.................... 39
Sale and Assignment of Receivables.................................... 39
Accounts.............................................................. 40
Servicing Procedures.................................................. 42
Collections........................................................... 42
Servicing Compensation and Payment of Expenses........................ 43
Advances.............................................................. 43
</TABLE>
4
<PAGE>
<TABLE>
<CAPTION>
PAGE
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<S> <C>
Distributions......................................................... 43
Credit and Cash Flow Enhancement...................................... 44
Net Deposits.......................................................... 45
Statements to Trustees and Trust...................................... 45
Evidence as to Compliance............................................. 46
Certain Matters Regarding the Servicer................................ 46
Events of Servicing Termination....................................... 47
Rights Upon Event of Servicing Termination............................ 48
Waiver of Past Defaults............................................... 48
Amendment............................................................. 49
Payment of Notes...................................................... 49
Termination........................................................... 49
Administration Agreement.............................................. 50
CERTAIN LEGAL ASPECTS OF THE RECEIVABLES................................ 51
General............................................................... 51
Security Interests in the Financed Vehicles........................... 51
Enforcement of Security Interests in Vehicles......................... 52
Other Matters......................................................... 53
Repurchase Obligation................................................. 53
ERISA CONSIDERATIONS.................................................... 53
PLAN OF DISTRIBUTION.................................................... 54
RATINGS................................................................. 55
LEGAL MATTERS........................................................... 55
INDEX OF TERMS.......................................................... 56
</TABLE>
5
<PAGE>
SUMMARY OF PROSPECTUS
The following Summary of Prospectus is qualified in its entirety by
reference to the detailed information appearing elsewhere in this Prospectus and
by reference to the information with respect to the Securities of any series
contained in the related Prospectus Supplement to be prepared and delivered in
connection with the offering of such Securities. Certain capitalized terms used
in this summary are defined elsewhere in this Prospectus on the pages indicated
in the 'Index of Terms.'
<TABLE>
<S> <C>
ISSUER................... The issuer (the 'ISSUER') with respect to each series
of Securities, shall be the Trust to be formed
pursuant to either a Trust Agreement (as amended and
supplemented from time to time, a 'TRUST AGREEMENT')
between the Owner Trustee for such Trust and the
Seller, or a Pooling and Servicing Agreement (as
amended and supplemented from time to time, the
'POOLING AND SERVICING AGREEMENT') among the Trustee
for such Trust, the Seller and the Servicer.
CHASE AUTO FINANCE....... Chase Manhattan Bank USA, National Association, a
national banking association headquartered in Delaware
which is a wholly-owned subsidiary of The Chase
Manhattan Corporation (the 'CORPORATION'), together
with its affiliates, is engaged in the automotive
financing and automotive loan servicing business. In
July 1996, The Chase Manhattan Bank, N.A. ('CHASE
N.A.') and Chemical Bank, both wholly-owned
subsidiaries of the Corporation, merged (the
'MERGER'), with Chemical Bank continuing as the
surviving corporation under the name 'The Chase
Manhattan Bank' ('CHASE').
As used in this Prospectus and in any Prospectus
Supplement, the term 'CHASE AUTO FINANCE' will be
deemed to refer to the automotive financing and
automotive loan servicing business of Chase, its
predecessors and its affiliates, and such term will
not include (unless otherwise specified) the
automotive financing and automotive loan servicing
business of Chemical Bank prior to the Merger.
SELLER................... Chase USA (in such capacity, the 'SELLER' or the
'BANK'). See 'Chase USA' herein.
SERVICER................. Chase USA (in such capacity, the 'SERVICER').
TRUSTEE.................. The entity named as 'TRUSTEE' in the related
Prospectus Supplement, which shall include the 'OWNER
TRUSTEE' with respect to any Certificates issued
pursuant to a Trust Agreement and the 'TRUSTEE' with
respect to any Certificates issued pursuant to a
Pooling and Servicing Agreement.
INDENTURE TRUSTEE........ With respect to Notes issued by a Trust pursuant to an
Indenture, the entity named as 'INDENTURE TRUSTEE' in
the related Prospectus Supplement.
DENOMINATIONS............ Each class of Securities of a series will be issued in
the minimum denominations set forth in the related
Prospectus Supplement. Each Security will represent a
percentage interest (a 'PERCENTAGE INTEREST') in the
Securities of the related class determined by dividing
the original dollar amount (or notional principal
amount, in the case of Securities entitled to interest
only and assigned a notional principal amount)
represented by such Security by the original aggregate
principal balance of such class (or original aggregate
notional principal amount, if applicable).
REGISTRATION OF
SECURITIES............... Each or any class of Securities of a series may be
issued in definitive form or may initially be
represented by one or more certificates ('BOOK-ENTRY
SECURITIES') registered in the name of Cede, the
nominee of DTC, and available
</TABLE>
6
<PAGE>
<TABLE>
<S> <C>
only in the form of book-entries on the records of
DTC, participating members thereof ('PARTICIPANTS')
and other entities, such as banks, brokers, dealers
and trust companies, that clear through or maintain
custodial relationships with a Participant, either
directly or indirectly ('INDIRECT PARTICIPANTS').
Securities representing Book-Entry Securities will be
issued in definitive form only under the limited
circumstances described herein and in the related
Prospectus Supplement. With respect to the Book-Entry
Securities, all references herein to 'HOLDERS' or
'SECURITYHOLDERS' shall reflect the rights of owners
of the Book-Entry Securities as they may indirectly
exercise such rights through DTC and Participants
(including Cedel and Euroclear), except as otherwise
specified herein. See 'Certain Information Regarding
the Securities--Book-Entry Registration' and
'--Definitive Securities' herein.
THE NOTES................ A series of Securities may include one or more classes
of Notes, which will be issued pursuant to an
Indenture between the related Trust and the Indenture
Trustee (as amended and supplemented from time to
time, an 'INDENTURE'). The related Prospectus
Supplement will specify which class or classes, if
any, of Notes of the related series are being offered
thereby.
Unless otherwise specified in the related Prospectus
Supplement, each class of Notes will have a stated
principal amount and will bear interest at a specified
rate or rates (with respect to each class of Notes,
the 'INTEREST RATE'). Each class of Notes may have a
different Interest Rate, which may be a fixed,
variable or adjustable Interest Rate, or any
combination of the foregoing. The related Prospectus
Supplement will specify the Interest Rate for each
class of Notes, or the method for determining the
Interest Rate.
With respect to a series that includes two or more
classes of Notes, each class may differ as to the
timing and priority of payments, seniority, Interest
Rate or amount of payments of principal or interest,
and payments of principal or interest in respect of
any such class or classes may or may not be made upon
the occurrence of specified events or on the basis of
collections from designated portions of the related
Receivables Pool.
In addition, a series may include one or more classes
of Notes ('STRIP NOTES') entitled to (i) principal
payments with disproportionate, nominal or no interest
payments or (ii) interest payments with
disproportionate, nominal or no principal payments.
If the Servicer exercises its option to purchase the
Receivables of a Trust (or, if not, and to the extent
provided in the related Prospectus Supplement, if
satisfactory bids for the purchase of such Receivables
are received), in the manner and on the respective
terms and conditions described herein under
'Description of the Transfer and Servicing
Agreements--Termination,' the outstanding Notes will
be redeemed as set forth in the related Prospectus
Supplement. In addition, if the related Prospectus
Supplement provides that the property of a Trust will
include a Pre-Funding Account, one or more classes of
the outstanding Notes will be subject to partial
redemption on or immediately following the end of the
related Funding Period in an amount and manner
specified in the related Prospectus Supplement. In the
event of such partial redemption, the Noteholders may
be entitled to receive a prepayment premium from the
related Trust, in the amount and to the extent
provided in the related Prospectus Supplement.
</TABLE>
7
<PAGE>
<TABLE>
<S> <C>
THE CERTIFICATES......... A series of Securities may include one or more classes
of Certificates. The related Prospectus Supplement
will specify which class or classes, if any, of the
Certificates are being offered thereby.
Unless otherwise specified in the related Prospectus
Supplement, each class of Certificates will have a
stated Certificate Balance specified in the related
Prospectus Supplement (the 'CERTIFICATE BALANCE') and
will accrue interest on such Certificate Balance at a
specified rate (with respect to each class of
Certificates, the 'PASS THROUGH RATE'). Each class of
Certificates may have a different Pass Through Rate,
which may be a fixed, variable or adjustable Pass
Through Rate, or any combination of the foregoing. The
related Prospectus Supplement will specify the Pass
Through Rate for each class of Certificates or the
method for determining the Pass Through Rate.
With respect to a series that includes two or more
classes of Certificates, each class may differ as to
timing and priority of distributions, seniority,
allocations or losses, Pass Through Rate or amount of
distributions in respect of principal or interest and
distributions in respect of principal or interest in
respect of any such class or classes may or may not be
made upon the occurrence of specified events or on the
basis of collections from designated portions of the
Receivables Pool.
In addition, a series may include one or more classes
of Certificates ('STRIP CERTIFICATES') entitled to (i)
distributions in respect of principal with
disproportionate, nominal or no interest distributions
or (ii) interest distributions with disproportionate,
nominal or no distributions in respect of principal.
If a series of Securities includes classes of Notes
and Certificates, distributions in respect of the
Certificates may be subordinated to distributions to
be made on Certificates of a different class of the
same series or to payments due on any related Notes to
the extent specified in the related Prospectus
Supplement.
If the Servicer exercises its option to purchase the
Receivables of a Trust (or, if not, and to the extent
provided in the related Prospectus Supplement, if
satisfactory bids for the purchase of such Receivables
are received), in the manner and on the respective
terms and conditions described herein under
'Description of the Transfer and Servicing
Agreements--Termination,' Certificateholders will
receive as a prepayment an amount in respect of the
Certificates as specified in the related Prospectus
Supplement. In addition, if the related Prospectus
Supplement provides that the property of a Trust will
include a Pre-Funding Account, Certificateholders may
receive a partial prepayment of principal on or
immediately following the end of the related Funding
Period in an amount and manner specified in the
related Prospectus Supplement. In the event of such
partial prepayment, the Certificateholders may be
entitled to receive a prepayment premium from the
related Trust, in the amount and to the extent
provided in the related Prospectus Supplement.
The Securities of a series may include one or more
classes of Certificates and/or one or more classes of
Notes.
</TABLE>
8
<PAGE>
<TABLE>
<S> <C>
THE TRUST PROPERTY....... The property of each Trust will include a pool of
Motor Vehicle Loans, including rights to receive
certain monies due or received thereunder on or after
the related Cutoff Date, security interests in the
vehicles financed thereby (the 'FINANCED VEHICLES'),
amounts on deposit in certain accounts and the
proceeds thereof and any proceeds from claims on
certain related insurance policies, as described
herein and in the related Prospectus Supplement. On or
before the Closing Date specified in the related
Prospectus Supplement with respect to a Trust, the
Seller will, if so specified in such Prospectus
Supplement, sell or transfer Motor Vehicle Loans (the
'INITIAL RECEIVABLES') having an aggregate principal
balance specified in the related Prospectus Supplement
as of the date specified therein to such Trust
pursuant to either a Sale and Servicing Agreement
among the Seller, the Servicer and such Trust (as
amended and supplemented from time to time, the 'SALE
AND SERVICING AGREEMENT') or the related Pooling and
Servicing Agreement. The property of each Trust will
also include amounts on deposit in certain trust
accounts, including any Collection Account, Cash
Collateral Account, Pre-Funding Account, Reserve
Account, Yield Supplement Account, Paid-Ahead Account
and any other account identified in the related
Prospectus Supplement.
To the extent provided in the related Prospectus
Supplement, from time to time during the funding
period specified in the related Prospectus Supplement
(the 'FUNDING PERIOD'), the Seller will be obligated
(subject only to the availability thereof) to sell,
and the related Trust will be obligated to purchase
(subject to the satisfaction of certain conditions
described in the applicable Sale and Servicing
Agreement or Pooling and Servicing Agreement),
additional Motor Vehicle Loans (the 'SUBSEQUENT
RECEIVABLES') and the related property having an
aggregate principal balance approximately equal to the
amount (the 'PRE-FUNDING AMOUNT') on deposit in the
related Pre-Funding Account on the related Closing
Date.
The Motor Vehicle Loans are motor vehicle retail
installment sales contracts relating to new or used
automobiles and light-duty trucks purchased from
Dealers who regularly originate and sell such
contracts to the Originating Bank pursuant to
Assignments. Motor Vehicle Loans also include purchase
money loans secured by financed vehicles made by the
Originating Bank directly or pursuant to arrangements
with Dealers in accordance with approved Dealer
agreements. The Receivables to be held by each Trust
will be selected from the Motor Vehicle Loans owned or
to be owned by the Seller based on the criteria set
forth in the related Sale and Servicing Agreement or
Pooling and Servicing Agreement, as applicable, and
described herein and in the related Prospectus
Supplement.
CREDIT AND CASH FLOW
ENHANCEMENT.............. If and to the extent specified in the related
Prospectus Supplement, credit enhancement with respect
to a Trust or any class or classes of Securities may
include any one or more of the following:
subordination of one or more other classes of
Securities, a Cash Collateral Guaranty secured by a
Cash Collateral Account, a Reserve Account, Yield
Supplement Agreements or Accounts, over-
collateralization, letters of credit, credit or
liquidity facilities, surety bonds, guaranteed
investment contracts, swaps or other interest rate
protection agreements, repurchase obligations, other
agreements with respect to third party payments or
other support, cash deposits or other arrangements.
The amount of any credit enhancement may be limited or
have exclusions from coverage and may decline over
time or under certain circumstances, all as specified
in the related Prospectus Supplement. See 'Description
of the Transfer and Servicing Agreements--Credit and
Cash Flow Enhancement' herein.
Cash Collateral Guaranty. If specified in the related
Prospectus Supplement with respect to any Trust
classified as a grantor trust, the related Trustee
will have the right to demand payments under a cash
collateral guaranty (the 'CASH COLLATERAL GUARANTY')
under certain circumstances as described herein and in
</TABLE>
9
<PAGE>
<TABLE>
<S> <C>
the related Prospectus Supplement. Each Cash
Collateral Guaranty will be secured by a Cash
Collateral Account, which will be held in the name of
a Cash Collateral Trustee, as specified in the related
Prospectus Supplement. The related Prospectus
Supplement will specify whether the Cash Collateral
Account will be funded on the date of issuance of the
related series of Securities solely from the proceeds
of a loan to be made by a cash collateral depositor
(the 'CASH COLLATERAL DEPOSITOR') pursuant to a Loan
Agreement, from a deposit by the Seller, or by a
combination thereof. To the extent specified in the
related Prospectus Supplement, funds in the related
Cash Collateral Account will thereafter be
supplemented by the deposit of amounts remaining on
any Distribution Date after making all other
distributions required on such date. Amounts drawn
under the Cash Collateral Guaranty will be available
to cover shortfalls in amounts due to the holders of
those classes of Securities specified in the related
Prospectus Supplement in the manner and under the
circumstances specified therein. The related
Prospectus Supplement will also specify to whom and
the manner and circumstances under which amounts on
deposit in the Cash Collateral Account (after giving
effect to all required distributions to be made by the
related Trust) in excess of the Required Cash
Collateral Amount (as defined in the related
Prospectus Supplement) will be distributed.
Reserve Account. If specified in the related
Prospectus Supplement with respect to any Trust not
classified as a grantor trust, a Reserve Account will
be funded on the date of issuance of the related
series of Securities, and if the related series has a
Funding Period, will also be funded on each Subsequent
Transfer Date. The related Prospectus Supplement will
specify whether the Reserve Account will be funded
solely from the proceeds of a loan or loans to be made
by a Cash Collateral Depositor pursuant to a Loan
Agreement, from a deposit or deposits by the Seller,
or by a combination thereof. To the extent specified
in the related Prospectus Supplement, funds in the
related Reserve Account will thereafter be
supplemented by the deposit of amounts remaining on
any Distribution Date or Payment Date after making all
other distributions required on such date. Amounts in
a Reserve Account will be available to cover
shortfalls in amounts due to the holders of those
classes of Securities specified in the related
Prospectus Supplement in the manner and under the
circumstances specified therein. The related
Prospectus Supplement will also specify to whom and
the manner and circumstances under which amounts on
deposit in the related Reserve Account (after giving
effect to all required distributions to be made by the
related Trust) in excess of the Specified Reserve
Account Balance (as defined in the related Prospectus
Supplement) will be distributed.
Demands under a Cash Collateral Guaranty will be
funded solely from amounts, if any, on deposit in the
related Cash Collateral Account. If the amount
deposited in such Cash Collateral Account or in any
Reserve Account is reduced to zero, the related
Securityholders will bear directly the credit and
other risks associated with ownership of the related
Receivables.
Yield Supplement Account; Yield Supplement
Agreement. If specified in the related Prospectus
Supplement, the Seller or a third party will enter
into a yield supplement agreement (as amended and
supplemented from time to time, a 'YIELD SUPPLEMENT
AGREEMENT') and/or establish a yield supplement
account (a 'YIELD SUPPLEMENT ACCOUNT') with the
related Indenture Trustee or related Trustee for the
benefit of the holders of the related Securities. A
Yield Supplement Agreement or a Yield Supplement
Account will be designed to provide payments to the
Securityholders in respect of Receivables the Contract
Rate of which is less than the Required Rate (as such
term is defined in the
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related Prospectus Supplement, the 'REQUIRED RATE'). A
Yield Supplement Account may be an asset of the
obligor under the related Yield Supplement Agreement
holding funds to secure the obligation of such obligor
to make payments under such Yield Supplement Agreement
or, in the case of a Trust that is not classified as a
grantor trust, may be an asset of the Trust from which
cash may periodically be withdrawn to provide payments
to the Securityholders.
TRANSFER AND SERVICING
AGREEMENTS............... With respect to each Trust, the Seller will assign to
such Trust, without recourse, the Seller's entire
interest in the related Receivables pursuant to a Sale
and Servicing Agreement or a Pooling and Servicing
Agreement. The rights and benefits of any Trust under
a Sale and Servicing Agreement will be assigned to the
related Indenture Trustee as collateral for the Notes
of the related series. The Servicer will agree with
respect to each Trust to be responsible for servicing,
managing, maintaining custody of and making
collections on the Receivables.
Unless otherwise provided in the related Prospectus
Supplement, the Seller will be obligated to repurchase
any Receivable if (a) such Receivable does not meet
any of the criteria set forth in the related Sale and
Servicing Agreement or Pooling and Servicing
Agreement, as applicable, and (b) such failure
materially and adversely affects the interests of the
holders of the related series of Securities in such
Receivable, unless the Seller has cured the failure to
meet the related criterion following the discovery by
or notice to the Seller of such failure. See
'Description of the Transfer and Servicing
Agreements--Sale and Assignment of Receivables'
herein.
Unless otherwise provided and to the extent set forth
in the related Prospectus Supplement, the Servicer
will be entitled to receive a fee for servicing the
Receivables of each Trust equal to a specified
percentage of the aggregate principal balance of the
related Receivables Pool plus any Late Fees collected
from Obligors during the related Collection Period. In
addition, to the extent set forth in the related
Prospectus Supplement, the Servicing Fee will also
include investment earnings on amounts on deposit in
the Trust Accounts. See 'Description of the Transfer
and Servicing Agreements--Servicing Compensation and
Payment of Expenses' herein and the corresponding
section in the related Prospectus Supplement.
ADVANCES................. If the Pooling and Servicing Agreement or Sale and
Servicing Agreement, as applicable, related to any
series provides that the Servicer may or is required
to make advances with respect to due and unpaid
amounts with respect to all or certain of the
Receivables, the related Prospectus Supplement shall
specify the terms and conditions pursuant to which
such Advances may or are required to be made.
TAX STATUS............... Unless the Prospectus Supplement specifies that the
related Trust will be classified as a grantor trust
and, except as otherwise provided in such Prospectus
Supplement, upon the issuance of the related series of
Securities, Simpson Thacher & Bartlett, special
counsel to the Seller ('FEDERAL TAX COUNSEL'), will
deliver an opinion to the effect that, for federal
income tax purposes: (i) any Notes of such series will
be treated as debt and (ii) such Trust will not be
characterized as an association (or a publicly traded
partnership) taxable as a corporation. Alternative
characterizations of such Trust and such Certificates
are possible, but would not result in materially
adverse tax consequences to Certificateholders.
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If the Prospectus Supplement specifies that the
related Trust will be classified as a grantor trust
and except as otherwise provided in such Prospectus
Supplement, upon the issuance of the related series of
Certificates, Federal Tax Counsel will deliver an
opinion to the effect that such Trust will be treated
as a grantor trust for federal income tax purposes and
not as an association (or other entity) taxable as a
corporation.
Each such opinion of Federal Tax Counsel referred to
in the preceding two paragraphs will be filed with the
Commission as an Exhibit to a Current Report filed on
Form 8-K.
Investors should consult their own tax advisors to
determine the federal, state, local and other tax
consequences of the purchase, ownership and
disposition of Securities of any series. See 'Certain
Federal Income Tax Consequences' and 'Certain State
Tax Consequences' in the related Prospectus
Supplement.
ERISA CONSIDERATIONS..... A fiduciary of any employee benefit plan or other plan
subject to ERISA or Section 4975 of the Code should
carefully review with its legal advisors whether the
purchase or holding of any class of Securities could
give rise to a transaction prohibited or not otherwise
permissible under ERISA or the Code. Certain classes
of Securities may not be acquired by any employee
benefit plan or other plan subject to ERISA or Section
4975 of the Code, as specified in the related
Prospectus Supplement. See 'ERISA Considerations'
herein and in the related Prospectus Supplement.
RATINGS OF THE
SECURITIES............... Each Prospectus Supplement will specify the ratings
upon which the issuance of each series of Securities
will be conditioned. See 'Ratings' herein.
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RISK FACTORS
CERTAIN LEGAL ASPECTS
In connection with each sale of Receivables to a Trust, the Seller will
assign its security interest in each individual Financed Vehicle to such Trust.
However, due to administrative burden and expense, neither the Seller nor the
related Trustee will amend the certificates of title to the Financed Vehicles to
identify the Trust or any related Indenture Trustee as the new secured party. In
addition, with respect to any security interests in Financed Vehicles acquired
by the Seller from an affiliated entity, the related certificates of title to
such Financed Vehicles will not be amended to identify the Seller as new secured
party before assignment to any Trust. In a majority of states, assignment of a
Receivable together with the related security interest is an effective
conveyance of such security interest without amendment of any lien noted on the
related certificates of title, and the new secured party succeeds to the
Originating Bank's rights as the secured party as against creditors of the
Obligor. In certain states, in the absence of such amendment and delivery, the
Seller, the related Trust and/or any related Indenture Trustee may not have a
perfected security interest in the related Financed Vehicle. Unless otherwise
specified in the related Prospectus Supplement, the Seller will be obligated to
repurchase any Receivable sold to a Trust as to which the Seller has represented
that the Originating Bank has a first perfected security interest in the
Financed Vehicle securing such Receivable, if a breach of such representation
shall materially adversely affect the interest of the related Securityholders in
such Receivable and if a breach of such representation shall not have been
cured. If such Trust does not have a perfected security interest in a Financed
Vehicle, the only recourse of such Trust vis-a-vis third parties would be
against the related Obligor on an unsecured basis or (if the Originating Bank
did not have a perfected security interest in such Financed Vehicle) against the
Seller pursuant to its repurchase obligation.
If a Trust does not have a perfected security interest in a Financed
Vehicle, its ability to realize on such Financed Vehicle in the event of a
default may be adversely affected. To the extent the security interest is
perfected, such Trust will have a prior claim over subsequent purchasers of such
Financed Vehicles and holders of subsequently perfected security interests.
However, under the laws of many states, certain possessory liens for repairs and
storage, as well as certain rights in favor of federal and state governmental
authorities arising from the use of a motor vehicle in connection with illegal
activities, may take priority even over a perfected security interest. Certain
federal tax liens may have priority over the lien of a secured party. In
addition, through fraud or negligence, a Trust could lose the priority of its
security interest or its security interest in a Financed Vehicle. Neither the
Seller nor the Servicer will have an obligation to repurchase a Receivable as to
which any of the aforementioned occurrences result in such Trust's losing the
priority of its security interest or its security interest in such Financed
Vehicle after the date such security interest was conveyed to such Trust (other
than through fraud or negligence of the Seller or the Servicer).
The Seller intends that each transfer of Receivables by it to a Trust under
a Sale and Servicing Agreement or a Pooling and Servicing Agreement constitutes
a sale. In the event that the Seller were to become insolvent, the Federal
Deposit Insurance Act ('FDIA'), as amended by the Financial Institutions Reform,
Recovery and Enforcement Act of 1989 ('FIRREA'), sets forth certain powers that
the FDIC may exercise if it were appointed receiver of such Seller. To the
extent that the Seller has granted a security interest in the Receivables to a
Trust and that interest was validly perfected before the Seller's insolvency and
was not taken in contemplation of insolvency or with the intent to hinder, delay
or defraud the Seller or its creditors, that security interest would not be
subject to avoidance by the FDIC as receiver of the Seller. Positions taken by
the FDIC staff prior to the passage of FIRREA do not suggest that the FDIC, if
appointed receiver of the Seller, would interfere with the timely transfer to
the Trust of payments collected on the related Receivables. If, however, the
FDIC were to assert a contrary position, or were to require the Trustee to
establish its rights to those payments by submitting to and completing the
administrative claims procedure established under the FDIA, or the conservator
or receiver were to request a stay of proceedings with respect to the Seller as
provided under the FDIA, delays in payments on the related Securities and
possible reductions in the amount of those payments could occur.
With respect to any Notes, unless otherwise specified in the related
Prospectus Supplement, if an Event of Default occurs, the Indenture Trustee or
the holders of not less than a majority of the aggregate principal amount of the
Notes may declare the principal of the Notes to be immediately due and payable,
and, if the Notes have been accelerated, the Indenture Trustee may institute or
be required to institute proceedings to collect amounts due or exercise its
remedies as a secured party (including foreclosure or sale of the Receivables).
The proceeds
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from any such sale will be treated as collections on the Receivables and
deposited in the Collection Account of such Trust. If the proceeds from the sale
of the trust assets and any amounts on deposit in any related Trust Account and
any amounts available from any credit enhancement are not sufficient to pay the
Notes and any Certificates of the related series in full, the amount of
principal returned to Noteholders and any Certificateholders will be reduced and
some or all of such Noteholders and Certificateholders will incur a loss.
Because neither interest nor principal may be distributed to Certificateholders
upon a sale of the Receivables following an Event of Default and acceleration of
the Notes under the Indenture until all the Notes have been paid in full, the
interests of Noteholders and Certificateholders may conflict, and the exercise
by the Indenture Trustee of its right to sell the Receivables or exercise other
remedies under the Indenture and applicable law may cause the Certificateholders
to suffer a loss of all or part of their investment. See 'Description of the
Notes--The Indenture' and 'Description of the Transfer and Servicing
Agreements--Rights Upon Event of Servicing Termination' herein.
TRUST'S RELATIONSHIP TO THE SELLER, THE SERVICER AND THEIR AFFILIATES
None of the Seller, the Servicer or their affiliates is generally obligated
to make any payments in respect of any Notes, any Certificates or the
Receivables of a given Trust.
However, in connection with the sale of Receivables by the Seller to a
given Trust, the Seller will make representations and warranties with respect to
the characteristics of such Receivables and, in certain circumstances, the
Seller may be required to repurchase Receivables with respect to which such
representations and warranties have been breached. See 'Description of the
Transfer and Servicing Agreements--Sale and Assignment of Receivables' herein.
In addition, under certain circumstances, the Servicer may be required to
purchase Receivables. See 'Description of the Transfer and Servicing
Agreements--Servicing Procedures' herein. Moreover, if the Bank were to cease
acting as the Servicer, delays in processing payments on the Receivables and
information in respect thereof could occur and result in delays in payments to
the Securityholders.
SUBORDINATION
To the extent specified in the related Prospectus Supplement, payments of
interest and/or principal on the Securities of any class of a series
('SUBORDINATED SECURITIES') may be subordinated in priority of payment to
interest and/or principal due on one or more other classes of Securities of such
series (the 'SENIOR SECURITIES'). For such series, the related Securityholders
will not receive any distributions with respect to a Distribution Date until the
full amount of interest on and/or principal of the related Senior Securities
distributable on such Distribution Date has been allocated to the Senior
Securities.
LIMITED ASSETS
Each Trust will not have, nor is it permitted or expected to have, any
significant assets or sources of funds other than the Receivables and, to the
extent provided in the related Prospectus Supplement, a Pre-Funding Account, a
Reserve Account, a Cash Collateral Guaranty, a Yield Supplement Agreement, a
Yield Supplement Account and any other credit enhancement. The Notes of any
series will represent obligations solely of, and the Certificates of any series
will represent interests solely in, the related Trust and neither the Notes nor
the Certificates of any series will be insured or guaranteed by the Seller, the
Servicer, any Trustee, any Indenture Trustee, any of their affiliates or any
other person or entity. Consequently, Securityholders of any series must rely
for repayment upon payments on the related Receivables and, if and to the extent
available, amounts available under the Cash Collateral Guaranty (if any), the
Yield Supplement Agreement (if any), amounts on deposit in the Pre-Funding
Account (if any), the Yield Supplement Account (if any) and the Reserve Account
(if any) and any other credit enhancement, all as specified in the related
Prospectus Supplement.
If the protection provided to any Securityholders of a given class of a
series by the subordination of the related Subordinated Securities, if any, and
by any Reserve Account, Cash Collateral Guaranty, Yield Supplement Agreement,
Yield Supplement Account or other credit enhancement for such class and series
is insufficient, such Securityholders would have to look principally to the
Obligors on the related Receivables and the proceeds from the repossession and
sale of Financed Vehicles that secure Defaulted Receivables. In such event,
certain factors, such as the applicable Trust not having perfected security
interests in the Financed Vehicles
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in all states, may affect the Servicer's ability to repossess and sell the
collateral securing the Receivables, and thus may reduce the proceeds to be
distributed to the holders of the Securities of such series. See 'Description of
the Transfer and Servicing Agreements--Distributions,' '--Credit and Cash Flow
Enhancement' and 'Certain Legal Aspects of the Receivables' herein.
MATURITY AND PREPAYMENT CONSIDERATIONS
The weighted average life of any series of Notes and any series of
Certificates will generally be influenced by the rate at which the principal
balances of the related Receivables are paid, which payment may be in the form
of scheduled amortization or prepayments. The Receivables are prepayable by the
Obligors at any time. If a Prospectus Supplement provides that the property of
the related Trust will include a Pre-Funding Account, the related Securities
will be subject to partial redemption on or immediately following the end of the
Funding Period in an amount and in the manner specified in the related
Prospectus Supplement. If provided in any Prospectus Supplement, prepayments may
also result from demands under any Cash Collateral Guaranty, Reserve Account or
other enhancement related to such series with respect to Defaulted Receivables.
See 'Description of the Transfer and Servicing Agreements--Sale and Assignment
of Receivables.' Any reinvestment risks resulting from a faster or slower
incidence of prepayment of Receivables held by a given Trust will be borne
entirely by the Securityholders of the related series of Securities. See also
'Description of the Transfer and Servicing Agreements--Termination' regarding
the Servicer's option to purchase the Receivables of a given Receivables Pool.
In addition, Chase Auto Finance may, on a case-by-case basis, permit
extensions with respect to the Due Dates of payments on Motor Vehicle Loans in
accordance with its normal and customary servicing practices and procedures. See
'Pooling and Servicing Agreement--Servicing Procedures' in the related
Prospectus Supplement or 'Description of the Transfer and Servicing
Agreements--Servicing Procedures' herein. Any such deferrals or extensions may
increase the weighted average life of the related Securities. However, the
Servicer will not be permitted to grant any such deferral or extension if as a
result the final scheduled payment on a Receivable would fall after the Final
Scheduled Maturity Date unless the Servicer repurchases the affected Receivable.
RISK OF COMMINGLING
With respect to each Trust, the Servicer will deposit all payments on the
related Receivables (from whatever source) and all proceeds of such Receivables
collected during each Collection Period into the Collection Account of such
Trust. For so long as the Seller is the Servicer and the Seller satisfies
certain requirements for making deposits less frequently than daily, the
Servicer will not be required to deposit such amounts in the Collection Account
of such Trust until on or before the related Deposit Date. Pending deposit into
such Collection Account, collections may be invested by the Servicer at its own
risk and for its own benefit and will not be segregated from funds of the
Servicer. If the Servicer were unable to remit such funds, the applicable
Securityholders might incur a loss. To the extent set forth in the related
Prospectus Supplement, the Servicer may, in order to satisfy the requirements
referred to herein, obtain a letter of credit or other security for the benefit
of the related Trust to secure timely remittances of collections on the related
Receivables and the payment of the aggregate Repurchase Amount with respect to
Receivables purchased by the Servicer.
RISK ASSOCIATED WITH SUBSEQUENT RECEIVABLES AND THE PRE-FUNDING ACCOUNT
If so specified in the related Prospectus Supplement, the Seller will be
obligated to sell, and the related Trust will be obligated to purchase,
Subsequent Receivables from time to time during the Funding Period specified in
the related Prospectus Supplement. The ability of the Seller to generate
Subsequent Receivables to be conveyed to such Trust will affect the amount on
deposit in the related Pre-Funding Account which is not applied to the
conveyance of Subsequent Receivables during the Funding Period. Amounts on
deposit in any Pre-Funding Account may be invested only in Permitted
Investments. Subsequent Receivables may be originated at a later date using
credit criteria different from those which were applied to any Initial
Receivables and may be of a different credit quality and seasoning. In addition,
following the transfer of Subsequent Receivables to the applicable Trust, the
characteristics of the entire pool of Receivables included in such Trust may
vary from those of the Initial Receivables transferred to such Trust. As a
result, it is possible that the credit quality of the Receivables in a Trust, as
a whole, may decline as a result of the inclusion of Subsequent Receivables and
may
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result in a higher rate of payment to the applicable Securityholders as a result
of an increased level of defaults on such Receivables. Securityholders will bear
all reinvestment risk associated with a higher than expected rate of payment on
the Securities. In addition, a higher than expected rate of payment may result
in a reduction in the yield to maturity of any class of Securities to which such
payments are distributed. To the extent that amounts on deposit in the
Pre-Funding Account have not been fully applied to the conveyance of Subsequent
Receivables to a Trust by the end of the Funding Period and such amount exceeds
the applicable amount described in the related Prospectus Supplement, the
holders of Securities issued by the related Trust will receive, on the
Distribution Date or Payment Date on or immediately following the last day of
the applicable Funding Period, a prepayment of principal in an amount equal to
the amount remaining in the Pre-Funding Account following the purchase of any
Subsequent Receivables on or immediately preceding such Distribution Date or
Payment Date. It is anticipated that the principal balance of Subsequent
Receivables sold to a Trust will not be exactly equal to the amount on deposit
in the Pre-Funding Account, and that therefore there will be at least a nominal
amount of principal prepaid to the holders of the Securities issued by such
Trust. Holders of Securities issued by such Trust will bear the reinvestment
risk associated with any such distribution of amounts on deposit in the
Pre-Funding Account after the termination of the applicable Funding Period. Any
such distribution will have the effect of a prepayment on the related
Receivables and may result in a reduction in the yield to maturity of any class
of Securities to which such amounts are distributed.
RIGHTS OF NOTEHOLDERS AND CERTIFICATEHOLDERS
In general, with respect to any Trust issuing Notes, the holders of any
Certificates issued by such Trust may direct the related Trustee in the
administration of the Trust. However, because the Trust will pledge the Trust
property to the Indenture Trustee to secure the payment of the Notes issued by
such Trust, including in such pledge the rights of the Trust under the related
Sale and Servicing Agreement, the related Indenture Trustee and not the
Certificateholders will have the power to direct the Trust to take certain
actions in connection with the administration of the Trust property until the
Notes have been paid in full and the lien of the Indenture has been released. In
addition, the Certificateholders will not be allowed to direct the related
Trustee to take any action which conflicts with the provisions of any of the
related Transfer and Servicing Agreements. Each Indenture will specifically
prohibit the related Trustee from taking any action which would impair the
related Indenture Trustee's security interest in the related Trust property and
will require the related Trustee to obtain the consent of the related Indenture
Trustee or the holders of not less than a majority of the aggregate principal
amount of the Notes issued by such Trust before modifying, amending,
supplementing, waiving or terminating any related Transfer and Servicing
Agreement or any provision of any related Transfer and Servicing Agreement.
Therefore, until a series of Notes have been paid in full, the ability to direct
the related Trust with respect to certain actions permitted to be taken under
the related Transfer and Servicing Agreements rests with the related Indenture
Trustee and the Noteholders instead of the Certificateholders. In addition, in
certain circumstances, Noteholders of Subordinated Securities will not be
entitled to take or direct any actions until the related Senior Securities have
been paid in full. See 'Description of the Notes--The Indenture Trustee' herein.
THE TRUSTS
With respect to each series of Securities, the Seller will establish a
separate Trust pursuant to a Trust Agreement or a Pooling and Servicing
Agreement, as applicable, for the purpose of conducting the activities described
herein and in the related Prospectus Supplement. The property of each Trust will
include (i) a pool (a 'RECEIVABLES POOL') of motor vehicle retail installment
sales contracts, purchase money notes and other notes ('MOTOR VEHICLE LOANS')
and all payments due or received thereunder (the 'RECEIVABLES') from the related
obligors (the 'OBLIGORS') on and after the related Cutoff Date specified in the
related Prospectus Supplement (a 'CUTOFF DATE'); (ii) such amounts as from time
to time may be held in separate trust accounts established and maintained
pursuant to the related Sale and Servicing Agreement or Pooling and Servicing
Agreement and the proceeds of such accounts, as described herein and in the
related Prospectus Supplement; (iii) security interests in the Financed
Vehicles; (iv) the rights to proceeds as a result of the Seller's exercise of
its recourse rights against Dealers (as described herein under 'The Receivables
Pools--Origination and Servicing of Motor Vehicle Loans'); (v) an assignment of
the rights of the Seller to receive proceeds from claims on theft and physical
damage, credit life and credit disability insurance policies covering the
Financed Vehicles or the Obligors, as the case may be, to the extent that such
insurance policies relate to the Receivables; (vi) the rights with respect to
any
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Financed Vehicle that has been repossessed by the Servicer on behalf of the
related Trust; and (vii) any and all proceeds of the foregoing. To the extent
specified in the related Prospectus Supplement, a Pre-Funding Account, Cash
Collateral Guaranty, Cash Collateral Account, Reserve Account, Yield Supplement
Agreement, Yield Supplement Account or other form of credit enhancement may be a
part of the property of any given Trust or may not be included in the property
of the Trust but be held by another trust or a trustee for the benefit of
holders of the related Securities.
On or before the related Closing Date, the Seller will sell the Initial
Receivables of the related Receivables Pool to the related Trust to the extent,
if any, specified in the related Prospectus Supplement. To the extent so
provided in the related Prospectus Supplement, Subsequent Receivables will be
conveyed to the related Trust as frequently as daily during the Funding Period.
Any Subsequent Receivables so conveyed will also be assets of the related Trust,
subject to the prior rights of the related Indenture Trustee and the
Noteholders, if any, therein.
The principal offices of each Trust and related Trustee will be specified
in the related Prospectus Supplement.
THE RECEIVABLES POOLS
GENERAL
As described herein, Chase USA, together with its affiliates, is currently
engaged in the automotive financing and automotive loan servicing business. As
used in this Prospectus and in any Prospectus Supplement, the term 'CHASE AUTO
FINANCE' will be deemed to refer to the automotive financing and automotive loan
servicing business of Chase, its predecessors and its affiliates, and such term
shall not include (unless otherwise specified) the automotive financing and
automotive loan servicing business of Chemical Bank prior to the Merger, and the
term 'ORIGINATING BANK' shall be deemed to refer to Chase N.A., Chase and Chase
USA or any of their respective affiliates in its capacity as originator of the
Motor Vehicle Loans.
The Motor Vehicle Loans are motor vehicle retail installment sales
contracts relating to new or used automobiles and light-duty trucks purchased
from Dealers who regularly originate and sell such contracts to the Originating
Bank pursuant to Assignments. Motor Vehicle Loans also include purchase money
loans secured by financed vehicles made by the Originating Bank directly or
pursuant to arrangements with Dealers in accordance with approved Dealer
agreements. The Receivables to be held by each Trust will be selected from the
portfolio of Motor Vehicle Loans owned or to be owned by the Seller for
inclusion in a Receivables Pool. Selection will be based upon several criteria,
including that, unless otherwise provided in the related Prospectus Supplement,
each Receivable (i) was acquired from or made through a Dealer located in the
United States or made directly by the Originating Bank without involvement of a
Dealer, (ii) is secured by a Financed Vehicle that, as of the related Cutoff
Date, had not been repossessed without reinstatement, (iii) has not been
identified on the computer files of the Seller as relating to an Obligor who was
in a bankruptcy proceeding as of the related Cutoff Date, (iv) (if not a Final
Payment Receivable) provides for fully amortizing level scheduled monthly
payments (except for the last payment, which may be different from the level
payments) and for accrual of interest at a fixed rate (the 'CONTRACT RATE')
according to the simple interest or actuarial method, (v) is an Actuarial
Receivable or a Simple Interest Receivable (either of which may be a Final
Payment Receivable) and (vi) satisfies the other criteria, if any, set forth in
the related Sale and Servicing Agreement or Pooling and Servicing Agreement, as
applicable, and in the related Prospectus Supplement. The Seller will not use
any selection procedures that it believes to be materially adverse to the
Securityholders of any series in selecting the related Receivables.
'SIMPLE INTEREST RECEIVABLES' provide for the allocation of payments made
thereunder to principal and interest in accordance with the 'simple interest'
method. As payments are received under a Simple Interest Receivable, the finance
charges accrued to date are paid first, the unpaid amount financed (to the
extent of the remaining monthly scheduled payment) is paid second and the
remaining payment is applied to the unpaid late charges. Accordingly, if an
Obligor pays the fixed monthly installment in advance of the date on which a
payment is due (the 'DUE DATE'), the portion of the payment allocable to finance
charges for the period since the preceding payment will be less than it would be
if the payment were made on the Due Date, and the portion of the payment
allocable to reduce the amount financed will be correspondingly greater.
Conversely, if the Obligor pays the fixed monthly installment after its Due
Date, the portion of the payment allocable to finance charges for the period
since the last payment will be greater than it would be if the payment were made
on the
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Due Date, and the portion of the payment allocable to reduce the amount financed
will be correspondingly smaller. When necessary, an adjustment is made at the
maturity of the loan to the scheduled final payment to reflect the larger or
smaller, as the case may be, allocations of payments to the amount financed
under a Simple Interest Receivable as a result of early or late payments, as the
case may be. See 'Weighted Average Life of the Securities' herein.
'ACTUARIAL RECEIVABLES' provide for amortization of the loan over a series
of fixed level payment monthly installments. Each monthly installment, including
the monthly installment representing the final payment on the Receivable,
consists of an amount of interest equal to 1/12th of the annual contract rate of
interest on the loan multiplied by the unpaid principal balance of the loan, and
an amount of principal equal to the remainder of the monthly payment.
'FINAL PAYMENT RECEIVABLES' are either Actuarial Receivables or Simple
Interest Receivables which provide for a final scheduled payment which is
greater than the scheduled monthly payments. A Final Payment Receivable provides
for amortization of the loan over a series of fixed level payment monthly
installments like an Actuarial Receivable or a Simple Interest Receivable, but
also requires a final scheduled payment due after payment of such monthly
installments which may be satisfied by (i) payment in full in cash of such
amount, (ii) transfer of the financed vehicle to the Seller provided certain
conditions are satisfied or (iii) refinancing the final scheduled payment in
accordance with certain conditions. With respect to any Final Payment
Receivables included in a Trust, only the principal and interest payments due
prior to the final scheduled payment and not the final scheduled payment will be
included in such Trust; the final scheduled payment will be retained by the
Seller. However, in the case of a Trust that is not classified as a grantor
trust, the Seller will have the option to transfer the final scheduled payments
with respect to the related Final Payment Receivables to such Trust and to cause
such Trust to issue certificates representing interests in such final scheduled
payments or notes secured by such final scheduled payments.
All of the Receivables will be prepayable at any time without penalty to
the Obligor and will contain due on sale provisions. If a Simple Interest
Receivable is prepaid, the Obligor is required to pay interest only to the date
of prepayment, rather than receive a rebate. If an Actuarial Receivable is
prepaid in full, with minor variations based upon state law, the Actuarial
Receivable requires that the rebate be calculated on the basis of a constant
interest rate.
In the case of the liquidation of a Receivable or repossession of a
Financed Vehicle, amounts recovered will be applied in accordance with Chase
Auto Finance's normal and customary servicing practices and procedures. Chase
Auto Finance reserves the right to change its policy with respect to the
application of amounts recovered from a liquidated Receivable or a repossessed
Financed Vehicle.
Information with respect to each Receivables Pool will be set forth in the
related Prospectus Supplement, including, to the extent appropriate, the
composition of the Receivables, the distribution by annual contract rate of
interest and by the states of origination of the Receivables, the portion of
such Receivables Pool consisting of Actuarial Receivables, Simple Interest
Receivables (and the portion thereof consisting of Final Payment Receivables)
and the portion of such Receivables Pool secured by new vehicles and by used
vehicles.
If the related Prospectus Supplement provides for a Pre-Funding Account,
each Subsequent Receivable of the related Trust must satisfy the eligibility
criteria specified in the related Pooling and Servicing Agreement or Sale and
Servicing Agreement, as applicable, at the time of its addition. However, except
for such criteria, there will be no required characteristics of such Subsequent
Receivables. Therefore, following the transfer of Subsequent Receivables to the
related Trust, the characteristics of the entire related Receivables Pool
included in such Trust may vary from those of the Initial Receivables.
Subsequent Receivables may be originated at a later date using credit
criteria different from those which were applied to any Initial Receivables and
may be of a different credit quality and seasoning. In addition, following the
transfer of Subsequent Receivables to the applicable Trust, the characteristics
of the entire pool of Receivables included in such Trust may vary from those of
the Initial Receivables transferred to such Trust. See 'Risk Factors--Risks
Associated with Subsequent Receivables and the Pre-Funding Account.' If the
Prospectus Supplement provides for a Pre-Funding Account, the Prospectus
Supplement will also describe the effects including Subsequent Receivables may
have on the Receivables Pool included in the related Trust. If a Trust includes
Subsequent Receivables, regular periodic reports regarding the Subsequent
Receivables will be included
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under Item 5 in each Current Report filed by or on behalf of such Trust on Form
8-K with the Commission pursuant to the Exchange Act.
DELINQUENCY AND LOAN LOSS INFORMATION
Certain information concerning the delinquencies, loan losses and
recoveries for the portfolio of indirect Motor Vehicle Loans owned or serviced
by Chase Auto Finance (the 'CHASE AUTO FINANCE PORTFOLIO') as of the dates and
for the periods set forth in the related Prospectus Supplement will be set forth
therein. There can be no assurance that the delinquency and loan loss experience
on any Receivables Pool will be comparable to prior experience or to such
information.
Pursuant to a merger, as of January 1, 1993, Chase N.A. commenced servicing
Motor Vehicle Loans originated by Chase N.A.'s affiliate, Chase Lincoln First
Bank, National Association ('CHASE LINCOLN BANK'). The Motor Vehicle Loans
included in a Trust will not include loans originated by Chase Lincoln Bank
(collectively, 'CHASE LINCOLN LOANS') but the delinquency and loan loss
experience with respect to the Chase Auto Finance Portfolio (the 'PORTFOLIO
EXPERIENCE') presented in the related Prospectus Supplement will include data
with respect to Chase Lincoln Loans. The Seller believes, however, that the
delinquency and loan loss experience of the Chase Lincoln Loans will not be
materially different from the Portfolio Experience set forth in the related
Prospectus Supplement.
From February 1993 through April 1995, Chase N.A. or Chase N.A.'s
affiliates serviced Motor Vehicle Loans for The Chase Manhattan Bank of
Connecticut, National Association ('CHASE CONNECTICUT BANK'), which loans
(collectively, 'CHASE CONNECTICUT LOANS') were originated using materially the
same Dealer Agreements, underwriting criteria and servicing standards as those
for Chase Auto Finance's Motor Vehicle Loans. As of May 1, 1995, Chase
Connecticut Bank was merged into Chase N.A. The Motor Vehicle Loans included in
a Trust will not include Chase Connecticut Loans, but the Portfolio Experience
presented in the related Prospectus Supplement will include data with respect to
Chase Connecticut Loans for the year ended December 31, 1993 and thereafter. The
Seller believes, however, that the delinquency and loan loss experience for
Chase Connecticut Loans will not be materially different from the Portfolio
Experience set forth in the related Prospectus Supplement.
On December 1, 1995, Chase N.A. purchased substantially the entire Motor
Vehicle Loan portfolio originated by its affiliate, The Chase Manhattan Private
Bank (Florida), National Association ('CHASE FLORIDA BANK'). The purchase
involved approximately 41,000 loans originated principally through Dealers
located in Florida ('CHASE FLORIDA LOANS'), with such loans having an aggregate
outstanding principal balance at the time of purchase of approximately $400
million. The Motor Vehicle Loans included in a Trust will not include Chase
Florida Loans, but the Portfolio Experience presented in the related Prospectus
Supplement will include data with respect to Chase Florida Loans. Chase Florida
Loans were originated using materially the same Dealer Agreements, underwriting
criteria and servicing standards as those for Chase Auto Finance's Motor Vehicle
Loans. The Seller believes that the delinquency and loan loss experience for
Chase Florida Loans will not be materially different from the Portfolio
Experience set forth in the related Prospectus Supplement.
In September 1995, Chase N.A. purchased substantially all outstanding Motor
Vehicle Loans originated by The Chase Manhattan Bank of Maryland ('CHASE
MARYLAND LOANS'). Although the Motor Vehicle Loans included in a Trust will not
include Chase Maryland Loans, the Portfolio Experience presented in the related
Prospectus Supplement for the period commencing October 1, 1995 will include
data with respect to Chase Maryland Loans. The Seller believes that the
delinquency and loan loss experience for Chase Auto Finance's entire portfolio
of Motor Vehicle Loans for any period presented in a Prospectus Supplement
without inclusion of any Chase Maryland Loans would not be materially different
from the Portfolio Experience set forth in such Prospectus Supplement.
To the extent specified in the related Prospectus Supplement, the Motor
Vehicle Loans included in a Trust may include loans made directly by the
Originating Bank to Obligors without involvement of Dealers ('DIRECT
RECEIVABLES'). However, the Portfolio Experience set forth in the related
Prospectus Supplement will not include delinquency and loan loss experience for
Direct Receivables. The Seller believes that the delinquency and loan loss
experience for Direct Receivables will not be materially different from the
Portfolio Experience set forth in the related Prospectus Supplement.
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ORIGINATION AND SERVICING OF MOTOR VEHICLE LOANS
The Originating Bank purchases motor vehicle retail installment sales
contracts relating to new or used automobiles from automobile dealers
('DEALERS') who regularly originate such contracts pursuant to the terms of
approved Dealer agreements. The Originating Bank also makes
purchase money loans secured by financed vehicles directly or pursuant to
arrangements with Dealers in accordance with approved Dealer agreements. Dealer
agreements and assignments related to motor vehicle retail installment sales
contracts, and Dealer agreements related to purchase money loans are
collectively referred to herein as 'DEALER AGREEMENTS.' The Originating Bank
purchases such contracts from Dealers pursuant to assignments (the
'ASSIGNMENTS'). Dealer Agreements are entered into with Dealers based upon a
financial review of each Dealer, and in some cases, the reputation and prior
experience of Chase Auto Finance with such Dealer and its key management.
Generally, Dealers who sell new financed vehicles are franchised by the
manufacturer of the financed vehicles.
The Originating Bank currently makes or purchases Motor Vehicle Loans
involving Dealers throughout the United States, except Alaska. Each Dealer makes
representations and warranties to the Originating Bank with respect to the Motor
Vehicle Loans, the obligors on the Motor Vehicle Loans and the security
interests in the financed vehicles relating thereto, which representations and
warranties typically include, among others, that (i) to the best of the Dealer's
knowledge, (a) no statements made or furnished to Chase Auto Finance by the
obligor, the Dealer or any other person are untrue or incomplete, (b) the
obligor has not financed any down payment for the financed vehicle, (c) the
obligor is a bona fide applicant having legal capacity to contract for a Motor
Vehicle Loan, (d) the signature of the obligor on all documents is genuine and
(e) the amount stated in the Motor Vehicle Loan to be due will in fact be due
and payable at the time or times provided therein free of any claims, defenses,
setoffs or counterclaims; (ii) the Dealer has verified the obligor's
identification; (iii) the Dealer had indefeasible title to the financed vehicle
immediately prior to the purchase by the obligor, and had the right and
authority to sell the vehicle to the obligor, free and clear of all liens and
encumbrances; (iv) the Dealer will secure and perfect for the Originating Bank a
security interest in the financed vehicle free and clear of any liens or
encumbrances; and (v) the description of the financed vehicle in the Motor
Vehicle Loan is true and complete and the financed vehicle will be or has been
duly delivered to and accepted without revocation by the obligor. Generally,
these representations and warranties do not relate to the creditworthiness of
the obligors or the collectibility of the Motor Vehicle Loans. Upon breach of
any representation or warranty made by a Dealer, the Originating Bank has a
right of recourse against such Dealer to require it to purchase or repurchase
such Motor Vehicle Loan. Generally, in determining whether to exercise any right
of recourse, Chase Auto Finance considers the prior performance of the Dealer
and other business and commercial factors. The Servicer will be obligated to
enforce such rights with respect to Dealer Agreements relating to the Motor
Vehicle Loans in accordance with Chase Auto Finance's customary practices, and
the right to any proceeds received upon such enforcement will be conveyed to the
related Trust under the related Pooling and Servicing Agreement or Sale and
Servicing Agreement, as applicable. The Seller will make no representations as
to the financial condition of such Dealers to which the Seller may have
recourse, and there can be no assurance as to the ability of any such Dealer to
perform its obligations under a Dealer Agreement.
The Originating Bank makes direct Motor Vehicle Loans to obligors at its
branches or by phone without the involvement of Dealers. Since there are no
Dealers involved in the origination of these Motor Vehicle Loans, no Dealer
representations and warranties are made with respect to these Motor Vehicle
Loans. Each Motor Vehicle Loan requires that each obligor secure and perfect for
the Originating Bank a security interest in the financed vehicle free and clear
of any liens or encumbrances. The obligor on each Motor Vehicle Loan made
directly by the Originating Bank is responsible for insuring compliance with
this requirement. Neither the Originating Bank, the Seller nor the Servicer
verifies or will verify whether these obligors satisfy this requirement.
The Servicer will service all of the Motor Vehicle Loans consistent with
Chase Auto Finance's servicing policies and practices. The servicing functions
performed by the Servicer or any of its affiliates on a centralized basis will
include the payment of Motor Vehicle Loan proceeds to Dealers, customer service,
document file and computerized record keeping, vehicle titles processing and
automated collections. Other servicing functions are generally regionalized and
are and will be performed by the several regional support offices called Dealer
Service Centers ('DSCS'). The servicing functions performed by the DSCs include
certain aspects of Dealer liaison,
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Dealer sales, customer service, credit underwriting, documentation reviews,
optical imaging and collections as well as other such services. The servicing
policies and practices of Chase Auto Finance may change over time in accordance
with the Bank's business judgment.
UNDERWRITING OF MOTOR VEHICLE LOANS
Each applicant for a Motor Vehicle Loan is evaluated individually by the
appropriate DSC based on uniform underwriting standards developed by Chase Auto
Finance. These underwriting standards are intended to assess the applicant's
ability to repay such Motor Vehicle Loan and the adequacy of the financed
vehicle as collateral, based upon a review of the information contained in a
loan application form that generally lists the applicant's income, deposit
accounts, liabilities, credit history, employment history and a description of
the financed vehicle intended to secure the Motor Vehicle Loan. Among the
criteria considered in evaluating the individual applications are (i) stability
of the obligor with specific regard to the obligor's length of residence in the
area, occupation, length of employment and whether the obligor rents or owns his
or her home; (ii) the obligor's payment history based on information known
directly by Chase Auto Finance or as provided by various credit reporting
agencies with respect to present and past debt; (iii) a debt service to gross
monthly income ratio test; (iv) a loan to value ratio test taking into account
the age, type and market value of the financed vehicle; and (v) a credit bureau
score.
The amount advanced under any Motor Vehicle Loan generally will not exceed
(i) for a new financed vehicle, the manufacturer's suggested retail price or
(ii) for a used financed vehicle, 110% of the 'average trade' value stated in
the most recently published National Automobile Dealer's Association Official
Used Car Price Guide (Eastern Edition) plus taxes and title and license fees
on the financed vehicle. However, the maximum amount advanced for Motor Vehicle
Loans is often less than such amounts depending on a number of factors,
including the length of the Motor Vehicle Loan term and the model and year of
the financed vehicle. These adjustments are made to insure that the financed
vehicle constitutes adequate collateral to secure the Motor Vehicle Loan. In
addition, whether a financed vehicle is new or used, Chase Auto Finance will
also finance credit life/accident/health insurance and service warranties under
a Motor Vehicle Loan. Chase Auto Finance's general policy has been to reject
applications for Motor Vehicle Loans whose applicants' debt service to gross
monthly income ratios exceed 40%.
Since July 1988, an empirically based credit scoring process has been used
by Chase Auto Finance to objectively index the applicant's creditworthiness.
This scoring process was created using historical information from the data base
of Motor Vehicle Loans owned and serviced by Chase Auto Finance. Through credit
scoring, Chase Auto Finance evaluates credit profiles in order to satisfactorily
quantify credit risk. The credit scoring process entails the use of statistics
to correlate common characteristics with credit risk. The credit scoring process
used by Chase Auto Finance is periodically reviewed to ensure its validity. In
addition to Chase Auto Finance's scoring process, since July 1992, Chase Auto
Finance has used consumer reporting agency scores to assist in the underwriting
process. In February 1993, Chase Auto Finance implemented an automated approval
and declination process for certain applications based on selection criteria
that was statistically derived from the data base of Motor Vehicle Loans owned
and serviced by Chase Auto Finance. Except for the applications that are
automatically approved or denied, each application is reviewed by a credit
analyst. Except for the applications that are automatically approved or denied,
Chase Auto Finance's scoring process and consumer reporting agency scores are
intended to provide a basis for lending decisions, but are not meant to
supersede the judgment of the credit analyst. Motor Vehicle Loan approval at
variance with standard credit guidelines has occurred, both before and after
implementation of the credit scoring process, but generally has required
concurrent approval of a second, designated senior credit analyst or credit
manager. Motor Vehicle Loans that do not comply with all of Chase Auto Finance's
guidelines must have strong compensating factors that indicate a high ability of
the applicant to repay the loan. Generally, if a Motor Vehicle Loan is approved
it is because the obligor has made a down payment and the amount financed is
lower than the maximum amount permitted by Chase Auto Finance's guidelines.
Detailed analysis of Chase Auto Finance's portfolio is performed to
evaluate the effectiveness of the credit guidelines and scoring process. If
external economic factors, credit delinquencies or credit losses change, credit
guidelines are adjusted to maintain a level of asset quality deemed acceptable
by Chase Auto Finance's management. Each day, the credit manager and credit
supervisors of each DSC review a computer selected group of Motor Vehicle Loans
to ensure that credit analysts are following Chase Auto Finance's established
policies
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and procedures. Chase Auto Finance randomly reviews, on a quarterly basis, the
quality of the Motor Vehicle Loans and conducts quality audits to ensure
compliance with established policies and procedures. The credit underwriting
standards of Chase Auto Finance may change over time in accordance with the
Bank's business judgment.
INSURANCE AND COLLECTION PROCEDURES
Each Motor Vehicle Loan requires the obligor to obtain fire, theft and
collision insurance or comprehensive and collision insurance with respect to the
financed vehicle. The Dealer Agreements include a representation and warranty
that each financed vehicle has such insurance at the time of origination of the
Motor Vehicle Loan. If an obligor fails to maintain the required insurance,
Chase Auto Finance may, but is not obligated to, purchase limited collision and
comprehensive insurance (force placed insurance) to protect the interests of
Chase Auto Finance and the obligor and to charge the obligor for the cost of
such insurance.
Chase Auto Finance previously purchased force placed insurance, but stopped
this practice in August 1993, and no force placed insurance coverage is
currently in effect on any of Chase Auto Finance's Motor Vehicle Loans. No Trust
will include any Motor Vehicle Loans on which force placed insurance was ever
purchased for the related financed vehicle, nor will any such Trust include any
Motor Vehicle Loans with coverage commonly known as vendor's single interest and
non-filing insurance. Unless otherwise specified in the related Prospectus
Supplement, there will be no third party insurance of any kind covering this
risk for any of the Motor Vehicle Loans included in any Trust. In addition,
neither the Seller, the Originating Bank nor the Servicer, as applicable,
independently verifies or will verify whether obligors obtain or maintain the
required insurance either at or after the origination of a Motor Vehicle Loan.
Chase Auto Finance monitors its loss experience with respect to financed
vehicles that are not properly insured.
The Bank reserves the right to change its policies with respect to
insurance on financed vehicles in accordance with its business judgment.
As a result of a New York statutory change, for Motor Vehicle Loans
originated through New York Dealers on and after approximately June 30, 1995,
Chase Auto Finance agreed not to obligate the related obligor for the so-called
'GAP amount' in the event there is a total loss of the vehicle caused by its
theft, confiscation or physical damage. The 'GAP amount' that the obligor will
not be obligated to pay is the difference between the amount owed on the Motor
Vehicle Loan as of the date of the total loss and the sum of (1) any unpaid
monthly payments, unpaid late fees and other unpaid amounts due prior to the
date of the total loss, plus (2) the vehicle's actual cash value as of the date
of the total loss. If the obligor has maintained the insurance required under
the Motor Vehicle Loan, the vehicle's actual cash value shall have the same
meaning as under the insurance policy (inclusive of the deductible, which the
Motor Vehicle Loan specifies may be no higher than $500). If the obligor has not
maintained the insurance required under the Motor Vehicle Loan, the vehicle's
actual cash value shall mean the 'average trade' value of the vehicle in the
most recently published National Automobile Dealer's Association Official Used
Car Guide (Eastern Edition) as of the date of the total loss. Chase Auto Finance
will not maintain third party insurance of any kind against this risk, and Chase
Auto Finance does not have any data on its historical loss experience on this
risk.
Collection activities with respect to delinquent Motor Vehicle Loans will
be performed by the Servicer or its affiliates consistent with Chase Auto
Finance's servicing policies and practices. Collection activities include prompt
investigation and evaluation of the causes of any delinquency. An obligor is
deemed current if an amount equal to no more than 10% of a scheduled monthly
payment remains unpaid.
An automated collection system is utilized to assist in collection efforts.
The automated collection system provides relevant obligor information (for
example, current addresses, phone numbers and loan information), records of all
contacts with obligors and, in some cases, automated dialing. The system also
records an obligor's promise to pay and allows supervisor review of collection
personnel activity, permits supervisors to modify priorities as to which
obligors should be contacted and provides extensive reports concerning Motor
Vehicle Loan delinquencies. Under current practices, contact by mail is made
with an obligor whose Motor Vehicle Loan has become 13 days delinquent and
personal telephone contact with the obligor is attempted on or after the 15th
day of delinquency. Generally, after a Motor Vehicle Loan continues to be
delinquent for 90 days, repossession procedures will have been implemented.
However, if (i) a Motor Vehicle Loan is deemed uncollectible, (ii) the financed
vehicle is deemed by collection personnel to be in danger of being damaged,
destroyed or made
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unavailable for repossession, or (iii) the obligor voluntarily surrenders the
financed vehicle, a repossession may occur without regard to length or existence
of payment delinquency. Repossessions are generally conducted by third parties
who are engaged in the business of repossessing vehicles for secured parties.
After repossession, the obligor generally has an additional 10 to 30 days to
redeem the financed vehicle before the financed vehicle is resold. Upon
repossession and sale of the financed vehicle, any deficiency remaining will be
pursued to the extent deemed practical and to the extent permitted by law.
Losses may occur in connection with delinquent Motor Vehicle Loans and can
arise in several ways, including the inability to locate the financed vehicle or
the obligor, or because of a discharge of the obligor in a bankruptcy
proceeding. Generally, losses on Motor Vehicle Loans are recognized, as
applicable, (a) during the calendar month in which a financed vehicle was or is
liquidated by Chase Auto Finance, if the liquidation takes place at or before
the calendar month in which more than 10% of a scheduled payment of the related
Motor Vehicle Loan becomes 150 days delinquent, (b) during the calendar month in
which more than 10% of a scheduled payment of a Motor Vehicle Loan becomes 150
days delinquent if Chase Auto Finance was or is not in possession of the related
financed vehicle by the end of such calendar month, (c) during the calendar
month in which a financed motor vehicle was or is liquidated by Chase Auto
Finance, if Chase Auto Finance came or comes into possession of the related
financed vehicle by the end of the calendar month in which more than 10% of a
scheduled payment on the related Motor Vehicle Loan becomes 150 days delinquent,
(d) such earlier time as Chase Auto Finance deems a Motor Vehicle Loan
uncollectible, or (e) at such other times or in such a manner as Chase Auto
Finance believed or believes is appropriate in accordance with its normal and
customary servicing practices and procedures; provided that such loss
recognition cannot be later than the calendar month in which more than 10% of a
scheduled payment on a Motor Vehicle Loan becomes 240 days delinquent. The loss
recognition and collection policies and practices of Chase Auto Finance may
change over time in accordance with the Bank's business judgment.
Chase Auto Finance may, on a case-by-case basis, permit extensions with
respect to the Due Dates of payments on Motor Vehicle Loans in accordance with
its normal and customary servicing practices and procedures, as will be
described more fully in the related Prospectus Supplement.
WEIGHTED AVERAGE LIFE OF THE SECURITIES
The weighted average life of the Notes, if any, and the Certificates, if
any, of any series will generally be influenced by the rate at which the
principal balances of the related Receivables are paid, which payment may be in
the form of scheduled amortization or prepayments. (For this purpose, the term
'prepayments' includes prepayments in full, partial prepayments, liquidations
due to default, as well as receipts of proceeds from theft and physical damage,
credit life and credit disability insurance policies covering the Financed
Vehicles and amounts received in connection with certain other Receivables
repurchased by the Seller or purchased by the Servicer for administrative
reasons). The Receivables are prepayable by the Obligors at any time. If a
Prospectus Supplement provides that the property of the related Trust will
include a Pre-Funding Account, the related Securities will be subject to partial
redemption on or immediately following the end of the Funding Period in an
amount and in the manner specified in the related Prospectus Supplement. If
provided in any Prospectus Supplement, prepayments may also result from demands
under any Cash Collateral Guaranty or from any Reserve Account or other
enhancement related to such series with respect to Defaulted Receivables.
The rate of prepayments on the Receivables may be influenced by a variety
of economic, social and other factors, including the fact that an Obligor may
not sell or transfer the Financed Vehicle securing a Receivable without the
Seller's consent. The rate of prepayment of the Motor Vehicle Loans in any
Receivables Pool may also be influenced by programs offered by lenders
(including the Bank and its affiliates) that solicit or make available credit
that may be used by Obligors to prepay Motor Vehicle Loans. Such credit includes
but is not limited to home equity lines of credit, consumer installment credit
and credit cards offered by lenders (including the Bank and its affiliates). The
Bank and its affiliates may, in the ordinary course of business, offer general
or targeted solicitations for such extensions of credit, and such solicitations
may be sent, to Obligors. In addition, each Sale and Servicing Agreement and
Pooling and Servicing Agreement will provide a covenant that the Servicer may
refinance an existing Motor Vehicle Loan for an Obligor, so long as the proceeds
of such refinanced loan would be used to prepay such existing Motor Vehicle Loan
in full and any such refinanced loan is evidenced by a new promissory note. Any
such loan thus created by a refinancing would not be the property of
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the related Trust. See 'Description of the Transfer and Servicing
Agreements--Termination' herein regarding the Servicer's option to purchase the
Receivables from a given Trust.
In light of the above considerations, there can be no assurance as to the
amount of principal payments to be made on the Securities of a given series on
each Payment Date or Distribution Date, as applicable, since such amount will
depend, in part, on the amount of principal collected on the related Receivables
Pool during the applicable Collection Period. Any reinvestment risks resulting
from a faster or slower incidence of prepayment of Receivables will be borne
entirely by the Securityholders of a given series. The related Prospectus
Supplement may set forth certain additional information with respect to the
maturity and prepayment considerations applicable to the particular Receivables
Pool and the related series of Securities.
Chase Auto Finance maintains limited records of the historical prepayment
experience of certain portions of its portfolio of Motor Vehicle Loans. The
Seller believes that such records are not adequate to provide meaningful
information with respect to the Receivables. In any event, no assurance can be
given that prepayments on the Receivables would conform to any historical
experience, and no prediction can be made as to the actual prepayment experience
to be expected with respect to the Receivables.
In addition, under certain limited circumstances, extensions on a
Receivable may be granted. See the related Prospectus Supplement for a
description of the terms and conditions in accordance with which the Receivables
in a particular Trust may be modified. Any such deferrals or extensions may
increase the weighted average life of the related Securities.
If an Obligor with respect to any Simple Interest Receivable, in addition
to making his or her regularly scheduled payment, makes one or more additional
scheduled payments in any Collection Period (for example, because such Obligor
intends to be on vacation the following month), the additional scheduled
payments made in such Collection Period will be treated as a principal
prepayment and applied to reduce the principal balance of the related Receivable
in such Collection Period and, unless otherwise requested by the Obligor, the
Obligor will not be required to make any scheduled payment in respect of such
Receivable (a 'PAID-AHEAD SIMPLE INTEREST RECEIVABLE') for the number of due
dates corresponding to the number of such additional scheduled payments (the
'PAID-AHEAD PERIOD'). During the Paid-Ahead Period, interest will continue to
accrue on the then outstanding principal balance of such Paid-Ahead Simple
Interest Receivable. The Obligor's Paid-Ahead Simple Interest Receivable will
not be considered delinquent during the Paid-Ahead Period. The related
Prospectus Supplement will set forth any Advances required to be made by the
Servicer with respect to Paid-Ahead Simple Interest Receivables.
When the Obligor resumes his or her required payments following the
Paid-Ahead Period, the payments so paid may be insufficient to cover the
interest that has accrued since the last payment by the Obligor. Notwithstanding
such insufficiency, the Obligor's Paid-Ahead Simple Interest Receivable would be
considered current. This situation will continue until the regularly scheduled
payments are once again sufficient to cover all accrued interest and to reduce
the principal balance of the Paid-Ahead Simple Interest Receivable. Depending on
the principal balance and Contract Rate of the related Receivable, and on the
number of payments that were prepaid, there may be extended periods of time
during which Receivables that are current are not amortizing.
Paid-Ahead Simple Interest Receivables in any Trust will affect the
weighted average life of the related Securities. The distribution of the
paid-ahead amount on the Distribution Date following the Collection Period in
which such amount was received will generally shorten the weighted average life
of such Securities. In addition, to the extent the Servicer makes Advances with
respect to a Paid-Ahead Simple Interest Receivable which subsequently goes into
default, because liquidation proceeds with respect to such Receivable will be
applied first to reimburse the Servicer for such Advances, the loss with respect
to such Receivable may be larger than would have been the case had such Advances
not been made.
The Chase Auto Finance Portfolio has historically included Motor Vehicle
Loans which have been prepaid by one or more scheduled monthly payments. There
can be no assurance as to the number of Receivables which may become Paid-Ahead
Simple Interest Receivables or the number or the principal amount of the
scheduled payments which may be paid-ahead.
If an Obligor with respect to any Actuarial Receivable, in addition to
making his or her regularly scheduled payment, makes one or more additional
scheduled payments in any Collection Period for similar reasons (such Receivable
being a 'PAID-AHEAD ACTUARIAL RECEIVABLE'), the additional scheduled payments
made in such
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Collection Period may be deposited into the Paid-Ahead Account, if any, for the
related Trust and applied on subsequent Deposit Dates as described in the
related Prospectus Supplement. See 'Description of the Transfer and Servicing
Agreements--Accounts.' To the extent paid-ahead amounts on Paid-Ahead Actuarial
Receivables are deposited into the Paid-Ahead Account, no shortfalls in payment
of interest or principal will result therefrom.
POOL FACTORS AND TRADING INFORMATION
The 'NOTE POOL FACTOR' for each class of Notes, if any, will be an
eight-digit decimal which the Servicer will compute prior to each distribution
with respect to such class of Notes expressing the remaining outstanding
principal balance of such class of Notes, as of the applicable Payment Date
(after giving effect to payments to be made on such Payment Date), as a fraction
of the initial outstanding principal balance of such class of Notes. The
'CERTIFICATE POOL FACTOR' for each class of Certificates, if any, will be an
eight-digit decimal which the Servicer will compute prior to each distribution
with respect to such class of Certificates expressing the remaining Certificate
Balance of such class of Certificates, as of the applicable Distribution Date or
Payment Date (after giving effect to distributions to be made on such
Distribution Date or Payment Date), as a fraction of the initial Certificate
Balance of such class of Certificates. Each Note Pool Factor and each
Certificate Pool Factor will be 1.00000000 as of the related Cutoff Date for
such series of Securities and thereafter will decline to reflect reductions in
the outstanding principal balance of the applicable class of Notes, or the
reduction of the Certificate Balance of the applicable class of Certificates, as
the case may be. A Noteholder's portion of the aggregate outstanding principal
balance of the related class of Notes is the product of (i) the original
denomination of such Noteholder's Note and (ii) the applicable Note Pool Factor.
A Certificateholder's portion of the aggregate outstanding Certificate Balance
for the related class of Certificates is the product of (a) the original
denomination of such Certificateholder's Certificate and (b) the applicable
Certificate Pool Factor.
Securityholders will receive monthly reports concerning payments received
on the Receivables, the Pool Balance (as such term is defined in the related
Prospectus Supplement, the 'POOL BALANCE'), each Certificate Pool Factor or Note
Pool Factor, as applicable, in each case related to such Trust, and various
other items of information specified in the related Prospectus Supplement. In
addition, Securityholders of record during any calendar year will be furnished
information for tax reporting purposes not later than the latest date permitted
by law. See 'Certain Information Regarding the Securities--Reports to
Securityholders' herein.
USE OF PROCEEDS
Unless the related Prospectus Supplement provides for other applications,
the net proceeds from the sale of the Securities of a given series (after making
the initial deposit into the related Reserve Account, Yield Supplement Account
or Cash Collateral Account, if any, or the deposit of the Pre-Funded Amount into
the related Pre-Funding Account, if any) will be added to the Seller's general
funds.
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CHASE USA
Chase USA, a wholly-owned subsidiary of the Corporation, is a national
banking association, a member of the Federal Reserve System and is subject to
the primary supervision of the Office of the Comptroller of the Currency. Chase
USA's activities are primarily related to general consumer lending.
The Corporation is a bank holding company the principal bank subsidiary of
which is Chase, a New York State bank.
The principal executive office of Chase USA is located at 802 Delaware
Avenue, Wilmington, Delaware 19801 (telephone (302) 575-5000).
DESCRIPTION OF THE NOTES
GENERAL
With respect to each Trust that issues Notes, one or more classes of Notes
of the related series will be issued pursuant to the terms of an Indenture, a
form of which has been filed as an exhibit to the Registration Statement of
which this Prospectus forms a part. The following, as well as other pertinent
information included elsewhere in this Prospectus and in the related Prospectus
Supplement, describes the material terms of the Notes of any series, but does
not purport to be complete and is subject to, and is qualified in its entirety
by reference to, the provisions of such Notes and the related Indenture.
Unless otherwise specified in the related Prospectus Supplement, each class
of Notes will initially be represented by one or more Notes, in each case
registered in the name of a nominee of DTC (together with any successor
depository selected by the Trust (the 'DEPOSITORY'), except as set forth below.
PRINCIPAL AND INTEREST ON THE NOTES
The timing and priority of payment, seniority, Interest Rate and amount of
or method of determining payments of principal and interest on each class of
Notes of a given series will be described in the related Prospectus Supplement.
The right of holders of any class of Notes to receive payments of principal and
interest may be senior or subordinate to the rights of holders of any other
class or classes of Notes of such series, as described in the related Prospectus
Supplement. Unless otherwise provided in the related Prospectus Supplement,
payments of interest on the Notes of such series will be made prior to payments
of principal thereon. To the extent provided in the related Prospectus
Supplement, a series may include one or more classes of Strip Notes entitled to
(i) principal payments with disproportionate, nominal or no interest payments or
(ii) interest payments with disproportionate, nominal or no principal payments.
Each class of Notes may have a different Interest Rate, which may be a fixed,
variable or adjustable Interest Rate (and which may be zero for certain classes
of Strip Notes), or any combination of the foregoing. The related Prospectus
Supplement will specify the Interest Rate for each class of Notes of a given
series or the method for determining such Interest Rate. See also 'Certain
Information Regarding the Securities--Fixed Rate Securities' and '--Floating
Rate Securities' herein. One or more classes of Notes of a series may be
redeemable in whole or in part under the circumstances specified in the related
Prospectus Supplement, including at the end of any applicable Funding Period or
as a result of the Servicer's exercise of its option to purchase the related
Receivables Pool.
To the extent specified in the related Prospectus Supplement, one or more
classes of the related series of Notes may have fixed principal payment
schedules. Noteholders of such Notes would be entitled to receive as payments of
principal on any given Payment Date the applicable amounts set forth on such
schedule with respect to such Notes, in the manner and to the extent set forth
in the related Prospectus Supplement.
Unless the related Prospectus Supplement specifies that Notes of different
classes within a series will have different priorities, payments to Noteholders
of all classes within a series in respect of interest will have the same
priority. Under certain circumstances, the amount available for such payments
could be less than the amount of interest payable on the Notes on any of the
dates specified for payments in the related Prospectus Supplement (each, a
'PAYMENT DATE') in which case each class of Noteholders will receive its ratable
share (based upon the aggregate amount of interest due to each such class of
Noteholders) of the aggregate amount available to be
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distributed in respect of interest on the Notes of such series. See 'Description
of the Transfer and Servicing Agreements--Distributions' and '--Credit and Cash
Flow Enhancement' herein.
In the case of a series of Notes which includes two or more classes of
Notes, the sequential order and priority of payment in respect of principal and
interest of each such class, and any schedule or formula or other provisions
applicable to the determination thereof, will be set forth in the related
Prospectus Supplement. Payments in respect of principal and interest of any
class of Notes will be made on a pro rata basis among all the Noteholders of
such class.
To the extent specified in the related Prospectus Supplement, one or more
classes of the related series of Notes may be entitled to receive principal
payments prior to the receipt of principal payments by other classes of the
related series. If so provided in the related Prospectus Supplement, such class
or classes of Notes may have a final scheduled Payment Date of less than 397
days from the date of the related Prospectus Supplement and such class or
classes may have received a short-term rating by a Rating Agency that is in one
of the two highest short-term rating categories. The failure to pay such a class
of Notes on or prior to the related final Payment Date would constitute an Event
of Default under the related Indenture.
To the extent specified in the related Prospectus Supplement, one or more
classes of the related series of Notes may be designed to receive principal
payments using a predetermined principal balance schedule (a 'planned balance')
derived by assuming two constant prepayment rates for the related Receivables
Pool. The related Prospectus Supplement will set forth a schedule of the planned
balance of such a class of Notes for each Payment Date. Holders of such a class
of Notes will be entitled to receive principal payments in respect of a Payment
Date only to the extent necessary to reduce the principal balance of such Notes
to the amount set forth as the planned balance for such Payment Date.
To the extent specified in the related Prospectus Supplement, one or more
classes of the related series of Notes may be designed to receive principal
payments using a predetermined principal balance schedule (a 'targeted balance')
derived by assuming one constant prepayment rate for the related Receivables
Pool. The related Prospectus Supplement will set forth a schedule of the
targeted balance of such a class of Notes for each Payment Date. Holders of such
a class of Notes will be entitled to receive principal payments in respect of a
Payment Date only to the extent necessary to reduce the principal balance of
such Notes to the amount set forth as the targeted balance for such Payment
Date.
To the extent specified in the related Prospectus Supplement, one or more
classes of the related series of Notes may be designed to receive principal
payments on a Payment Date only if principal payments have been made on a
specified planned amortization class of Notes or targeted amortization class of
Notes, and to receive any excess payments over the amount required to reduce the
principal amount of the planned amortization class or targeted amortization
class to the planned or targeted balance for such Payment Date.
If the Servicer exercises its option to purchase the Receivables of a Trust
in the manner and on the respective terms and conditions described under
'Description of the Transfer and Servicing Agreements--Termination' herein, the
related outstanding Notes will be prepaid as set forth in the related Prospectus
Supplement. In addition, if the related Prospectus Supplement provides that the
property of a Trust will include a Pre-Funding Account, the related outstanding
Notes may be subject to partial prepayment on or immediately following the end
of the related Funding Period in an amount and manner specified in the related
Prospectus Supplement. In the event of such partial prepayment, the Noteholders
of the related series may be entitled to receive a prepayment premium, in the
amount and to the extent provided in the related Prospectus Supplement.
THE INDENTURE
Modification of Indenture. With respect to each Trust that has issued
Notes pursuant to an Indenture, such Trust and the related Indenture Trustee
may, with the consent of the holders of a majority of the outstanding Notes of
the related series, execute a supplemental indenture to add provisions to,
change in any manner or eliminate any provisions of, the related Indenture, or
modify (except as provided below) in any manner the rights of the related
Noteholders.
Unless otherwise specified in the related Prospectus Supplement with
respect to a series of Notes, without the consent of the holder of each such
outstanding Note affected thereby, no supplemental indenture will: (i)
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change the date of payment of any installment of principal of or interest on any
such Note or reduce the principal amount thereof, the Interest Rate specified
thereon or the redemption price with respect thereto or change any place of
payment where, or the coin or currency in which, any such Note or any interest
thereon is payable; (ii) impair the right to institute suit for the enforcement
of certain provisions of the related Indenture regarding payment; (iii) reduce
the percentage of the aggregate amount of the outstanding Notes of such series,
the consent of the holders of which is required (a) for any such supplemental
indenture or (b) for any waiver of compliance with certain provisions of the
related Indenture or of certain defaults thereunder and their consequences as
provided for in such Indenture; (iv) modify or alter the provisions of the
related Indenture regarding the voting of Notes held by the related Trust, any
other obligor on such Notes, the Seller or an affiliate of any of them; (v)
reduce the percentage of the aggregate outstanding amount of such Notes required
to direct the related Indenture Trustee to sell or liquidate the Receivables,
the consent of the holders of which is required if the proceeds of such sale or
liquidation would be insufficient to pay the principal amount and accrued but
unpaid interest on the outstanding Notes of such series; (vi) decrease the
percentage of the aggregate principal amount of such Notes required to amend the
sections of the related Indenture that specify the applicable percentage of
aggregate principal amount of the Notes of such series necessary to amend such
Indenture or certain other related agreements; (vii) modify any provisions of
the Indenture in such a manner as to affect the calculation of the amount of any
payment of interest or principal due on any Note on any Payment Date (including
the calculation of any of the individual components of such calculation); or
(viii) permit the creation of any lien ranking prior to or on a parity with the
lien of the related Indenture with respect to any of the collateral for such
Notes or, except as otherwise permitted or contemplated in such Indenture,
terminate the lien of such Indenture on any such collateral or deprive the
holder of any such Note of the security afforded by the lien of such Indenture.
Unless otherwise provided in the related Prospectus Supplement, the related
Trust and the related Indenture Trustee may also enter into supplemental
indentures, without obtaining the consent of the Noteholders of the related
series, for the purpose of, among other things, adding any provisions to or
changing in any manner or eliminating any of the provisions of the related
Indenture or of modifying in any manner the rights of such Noteholders; provided
that such action will not materially and adversely affect the interest of any
such Noteholder.
Events of Default; Rights Upon Event of Default. With respect to the Notes
of a given series, unless otherwise specified in the related Prospectus
Supplement, 'EVENTS OF DEFAULT' under the related Indenture will consist of: (i)
a default in the payment of any interest on any such Note for a period of five
days; (ii) a default in the payment of the principal of or any installment of
the principal of any such Note when the same becomes due and payable; (iii) a
default in the observance or performance of any covenant or agreement of the
related Trust made in the related Indenture which default materially and
adversely affects the rights of the related Noteholders, and which default
continues for a period of 30 days after written notice thereof is given to such
Trust by the related Indenture Trustee or to such Trust and such Indenture
Trustee by the holders of at least 25% in principal amount of such Notes then
outstanding (or for such longer period, not in excess of 90 days, as may be
reasonably necessary to remedy such default; provided that such default is
capable of remedy within 90 days or less); or (iv) certain events of bankruptcy,
insolvency, receivership or liquidation of the related Trust. However, the
amount of principal required to be paid to Noteholders of such series under the
related Indenture will generally be limited to amounts available to be deposited
in the related Note Distribution Account (absent acceleration of the Notes).
Therefore, unless otherwise specified in the related Prospectus Supplement, the
failure to pay principal on a class of Notes on any Payment Date generally will
not result in the occurrence of an Event of Default until the final scheduled
Payment Date for such class of Notes.
If an Event of Default should occur and be continuing with respect to the
Notes of any series, unless otherwise specified in the related Prospectus
Supplement, the related Indenture Trustee or holders of a majority in principal
amount of such Notes then outstanding may declare the principal of such Notes to
be immediately due and payable. Unless otherwise specified in the related
Prospectus Supplement, such declaration may, under certain circumstances, be
rescinded by the holders of a majority in principal amount of such Notes then
outstanding.
If the Notes of any series are declared to be due and payable following an
Event of Default with respect thereto, the related Indenture Trustee may
institute proceedings to collect amounts due or foreclose on the related Trust
property, exercise remedies as a secured party, sell the related Receivables or
elect to have the related Trust
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maintain possession of such Receivables and continue to apply collections on
such Receivables as if there had been no declaration of acceleration. Unless
otherwise specified in the related Prospectus Supplement, however, the related
Indenture Trustee is prohibited from selling the related Receivables following
an Event of Default, unless (i) the holders of all such outstanding Notes
consent to such sale, (ii) the proceeds of such sale are sufficient to pay in
full the principal and the accrued interest on such outstanding Notes and the
Certificate Balance and accrued interest on the Certificates of such series at
the date of such sale, or (iii) there has been an Event of Default arising from
a failure to make a required payment of principal or interest on any such Notes,
and such Indenture Trustee determines that the proceeds of Receivables would not
be sufficient on an ongoing basis to make all payments on such Notes as such
payments would have become due if such obligations had not been declared due and
payable, and such Indenture Trustee obtains the consent of the holders of
sixty-six and two-thirds percent of the aggregate outstanding principal amount
of such Notes.
If an Event of Default occurs and is continuing with respect to a series of
Notes, the related Indenture Trustee will be under no obligation to exercise any
of the rights or powers under the related Indenture at the request or direction
of any of the holders of such Notes, if such Indenture Trustee reasonably
believes it will not be adequately indemnified against the costs, expenses and
liabilities which might be incurred by it in complying with such request.
Subject to the provisions for indemnification and certain limitations contained
in the related Indenture, the holders of a majority in principal amount of the
outstanding Notes of a given series will have the right to direct the time,
method and place of conducting any proceeding or any remedy available to the
related Indenture Trustee, and the holders of a majority in principal amount of
such Notes then outstanding may, in certain cases, waive any default with
respect thereto, except a default in the payment of principal or interest or a
default in respect of a covenant or provision of such Indenture that cannot be
modified without the waiver or consent of all the holders of such outstanding
Notes.
Unless and to the extent the related Prospectus Supplement specifies other
circumstances in which a holder of a Note of a series will have the right to
institute the proceedings described below, no holder of such a Note will have
the right to institute any proceeding with respect to the related Indenture
unless (i) such holder has previously given written notice to the related
Indenture Trustee of a continuing Event of Default, (ii) the holders of not less
than 25% in principal amount of the outstanding Notes of such series have made
written request to such Indenture Trustee to institute such proceeding in its
own name as Indenture Trustee, (iii) such holder or holders have offered such
Indenture Trustee indemnity reasonably satisfactory to it against the costs,
expenses and liabilities to be incurred in complying with such request, (iv)
such Indenture Trustee has for 60 days after receipt of such notice, request and
offer of indemnity failed to institute such proceeding, and (v) no direction
inconsistent with such written request has been given to such Indenture Trustee
during such 60-day period by the holders of a majority in principal amount of
such outstanding Notes.
In addition, each Indenture Trustee and the related Noteholders, by
accepting the related Notes, will covenant that they will not at any time
institute against the related Trust any bankruptcy, reorganization or other
proceeding under any federal or state bankruptcy or similar law.
With respect to any Trust, neither the related Indenture Trustee nor the
related Owner Trustee in its individual capacity, nor any holder of a
Certificate representing an ownership interest in such Trust nor any of their
respective owners, beneficiaries, agents, officers, directors, employees,
affiliates, successors or assigns will, in the absence of an express agreement
to the contrary, be personally liable for the payment of the principal of or
interest on the related Notes or for the agreements of such Trust contained in
the related Indenture.
CERTAIN COVENANTS
Each Indenture will provide that the related Trust may not consolidate with
or merge into any other entity, unless (i) the entity formed by or surviving
such consolidation or merger is organized under the laws of the United States,
any state or the District of Columbia, (ii) such entity expressly assumes such
Trust's obligation to make due and punctual payments of principal and interest
on the Notes of the related series and the performance or observance of every
agreement and covenant of such Trust under the Indenture, (iii) no Event of
Default with respect to such series shall have occurred and be continuing
immediately after such merger or consolidation, (iv) such Trust has been advised
that the rating of the Notes or the Certificates of such series, if any, then in
effect would not be downgraded or withdrawn by the related Rating Agencies as a
result of such merger or consolidation, (v) such action as was necessary to
maintain the lien and security interest created by such
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Indenture shall have been taken, and (vi) such Trust has received an opinion of
counsel to the effect that such consolidation or merger would have no material
adverse tax consequence to such Trust or to any related Noteholder or
Certificateholder.
Each Trust will not, among other things, (i) except as expressly permitted
by the related Indenture, Transfer and Servicing Agreements or certain related
documents with respect to such Trust (collectively, the 'RELATED DOCUMENTS'),
sell, transfer, exchange or otherwise dispose of any of the properties or assets
of such Trust, (ii) claim any credit on or make any deduction from the principal
or interest payable in respect of the Notes of the related series (other than
amounts withheld under the Code or applicable state law) or assert any claim
against any present or former holder of such Notes because of the payment of
taxes levied or assessed upon such Trust, (iii) permit the validity or
effectiveness of the related Indenture to be impaired or permit any person to be
released from any covenants or obligations with respect to such Notes under such
Indenture except as may be expressly permitted thereby, (iv) permit any lien,
charge, excise, claim, security interest, mortgage or other encumbrance to be
created on or extend to or otherwise arise upon or burden the assets of such
Trust or any party thereof, or any interest therein or the proceeds thereof, or
(v) permit any lien of such Indenture not to constitute a valid first priority
security interest in such Trust (other than with respect to any such tax,
mechanics' or other lien).
No Trust may engage in any activity other than as specified in the related
Prospectus Supplement. No Trust will incur, assume or guarantee any indebtedness
other than indebtedness incurred pursuant to the related Notes and the related
Indenture, pursuant to any Advances made to it by the Servicer or otherwise in
accordance with the Related Documents.
Annual Compliance Statement. Each Trust will be required to file annually
with the related Indenture Trustee a written statement as to the fulfillment of
its obligations under the Indenture.
Indenture Trustee's Annual Report. The Indenture Trustee for each Trust
will be required to mail each year to all related Noteholders a brief report
relating to its eligibility and qualification to continue as Indenture Trustee
under the related Indenture, any amounts advanced by it under the related
Indenture, the amount, interest rate and maturity date of certain indebtedness
owing by such Trust to the related Indenture Trustee in its individual capacity,
the property and funds physically held by such Indenture Trustee as such and any
action taken by it that materially affects the related Notes and that has not
been previously reported.
Satisfaction and Discharge of Indenture. An Indenture will be discharged
with respect to the related Notes upon the delivery to the related Indenture
Trustee for cancellation of all such Notes or, with certain limitations, upon
deposit with such Indenture Trustee of funds sufficient for the payment in full
of all such Notes.
THE INDENTURE TRUSTEE
The Indenture Trustee for a series of Notes will be specified in the
related Prospectus Supplement. The Indenture Trustee for any series may resign
at any time, in which event the Administrator of the related Trust will be
obligated to appoint a successor indenture trustee for such series. The
Administrator of the related Trust may also remove any such Indenture Trustee if
such Indenture Trustee ceases to be eligible to continue as such under the
related Indenture or if such Indenture Trustee becomes insolvent. In such
circumstances, the Administrator of the related Trust will be obligated to
appoint a successor trustee for the related series of Notes. If an Event of
Default occurs under an Indenture and the related Prospectus Supplement provides
that a given class of Notes of the related series is subordinated to one or more
other classes of Notes of such series, pursuant to the Trust Indenture Act of
1939, as amended, the related Indenture Trustee may be deemed to have a conflict
of interest and be required to resign as trustee for one or more of such classes
of Notes. In any such case, the related Indenture will provide for a successor
trustee to be appointed for one or more of such classes of Notes and may provide
for rights of senior Noteholders to consent to or direct actions by the related
Indenture Trustee which are different from those of subordinated Noteholders.
Any resignation or removal of the Indenture Trustee and appointment of a
successor indenture trustee for any series of Notes will not become effective
until acceptance of the appointment by the successor indenture trustee for such
series.
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DESCRIPTION OF THE CERTIFICATES
GENERAL
With respect to each Trust, one or more classes of Certificates of the
related series may be issued pursuant to the terms of a Trust Agreement or a
Pooling and Servicing Agreement, a form of each of which has been filed as an
exhibit to the Registration Statement of which this Prospectus forms a part. The
following, as well as other pertinent information included elsewhere in this
Prospectus and in the related Prospectus Supplement, describes the material
terms of the Certificates of any series, but does not purport to be complete and
is subject to, and is qualified in its entirety by reference to, the provisions
of such Certificates and the related Trust Agreement or Pooling and Servicing
Agreement, as applicable.
The related Prospectus Supplement will specify whether each class of
Certificates of the related series will initially be represented by one or more
Certificates, in each case registered in the name of the Depository or its
nominee (except as set forth below) or will be issued in fully registered,
certificated form.
DISTRIBUTIONS OF PRINCIPAL AND INTEREST
The timing and priority of distributions, seniority, allocations of losses,
Pass Through Rate and amount of or method of determining distributions with
respect to principal and interest of each class of Certificates with respect to
any series will be described in the related Prospectus Supplement. Distributions
of interest on such Certificates will be made on the dates specified in the
related Prospectus Supplement (each, a 'DISTRIBUTION DATE') and will be made
prior to distributions with respect to principal of such Certificates. To the
extent provided in the related Prospectus Supplement, a series may include one
or more classes of Strip Certificates entitled to (i) distributions in respect
of principal with disproportionate, nominal or no interest distributions, or
(ii) interest distributions with disproportionate, nominal or no distributions
in respect of principal. Each class of Certificates may have a different Pass
Through Rate, which may be a fixed, variable or adjustable Pass Through Rate
(and which may be zero for certain classes of Strip Certificates) or any
combination of the foregoing. The related Prospectus Supplement will specify the
Pass Through Rate for each class of Certificates of a given series or the method
for determining such Pass Through Rate. See also 'Certain Information Regarding
the Securities--Fixed Rate Securities' and '--Floating Rate Securities' herein.
Unless otherwise provided in the related Prospectus Supplement, distributions in
respect of the Certificates of a given series that are issued with Notes will be
subordinate to payments in respect of such Notes as more fully described in the
related Prospectus Supplement. Distributions in respect of interest on and
principal of any class of Certificates will be made on a pro rata basis among
all the Certificateholders of such class.
In the case of a series of Certificates that includes two or more classes
of Certificates, the timing, sequential order, priority of payment or amount of
distributions in respect of interest and principal on each such class, and any
schedule or formula or other provisions applicable to the determination thereof,
shall be as set forth in the related Prospectus Supplement.
If the Servicer exercises its option to purchase the Receivables of a Trust
in the manner and on the respective terms and conditions described under
'Description of the Transfer and Servicing Agreements--Termination' herein,
related Certificateholders will receive as prepayment an amount in respect of
such Certificates as specified in the related Prospectus Supplement. In
addition, if the related Prospectus Supplement provides that the property of a
Trust will include a Pre-Funding Account, related Certificateholders may receive
a partial prepayment of principal on or immediately following the end of the
Funding Period in an amount and manner specified in the related Prospectus
Supplement. In the event of such partial prepayment, the Certificateholders may
be entitled to receive a prepayment premium, in the amount and to the extent
provided in the related Prospectus Supplement.
THE TRUSTEE
The Trustee for each Trust will be specified in the related Prospectus
Supplement. The Trustee's liability in connection with the issuance and sale of
the related Securities is limited solely to the express obligations of such
Trustee set forth in the related Trust Agreement and the Sale and Servicing
Agreement or the related Pooling and Servicing Agreement, as applicable. The
Trustee under each Trust Agreement or Pooling and Servicing Agreement, as
applicable, will perform administrative functions, including, if specified in
the related Prospectus
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Supplement, making distributions from the related Certificate Distribution
Account. A Trustee may resign at any time by giving written notice thereof to
the Servicer under the related Pooling and Servicing Agreement or the
Administrator under the related Trust Agreement, in which event the Servicer or
the Administrator, as the case may be, or its successor, will be obligated to
appoint a successor trustee. The Servicer or the Administrator may also remove
the Trustee if such Trustee ceases to be eligible to continue as Trustee under
the related Pool and Servicing Agreement or Trust Agreement, as applicable,
becomes legally unable to act or if such Trustee becomes insolvent. In such
circumstances, the Servicer or the Administrator will be obligated to appoint a
successor trustee. Any resignation or removal of a Trustee and appointment of a
successor trustee will not become effective until acceptance of the appointment
by the successor trustee. If the Administrator or Servicer shall not provide
such indemnification, the Servicer may be indemnified from the related Trust,
provided, that no indemnification shall be paid on any Distribution Date or
Payment Date, as applicable, until the Securityholders and the Servicer have
been paid all amounts otherwise due and the amount on deposit in any enhancement
account shall equal its required amount.
CERTAIN INFORMATION REGARDING THE SECURITIES
FIXED RATE SECURITIES
Each class of Securities (other than certain classes of Strip Notes or
Strip Certificates) may bear interest at a fixed rate per annum ('FIXED RATE
SECURITIES') or at a variable or adjustable rate per annum ('FLOATING RATE
SECURITIES'), as more fully described below and in the related Prospectus
Supplement. Each class of Fixed Rate Securities will bear interest at the
applicable per annum Interest Rate or Pass Through Rate, as the case may be,
specified in the related Prospectus Supplement. Unless otherwise set forth in
the related Prospectus Supplement, interest on each class of Fixed Rate
Securities will be computed on the basis of a 360-day year of twelve 30-day
months. See 'Description of the Notes--Principal and Interest on the Notes' and
'Description of the Certificates--Distributions of Principal and Interest'
herein.
FLOATING RATE SECURITIES
Each class of Floating Rate Securities will bear interest for each related
Interest Reset Period (as such term is defined in the related Prospectus
Supplement with respect to a class of Floating Rate Securities, an 'INTEREST
RESET PERIOD') at a rate per annum determined by reference to an interest rate
basis (the 'BASE RATE'), plus or minus the Spread, if any, or multiplied by the
Spread Multiplier, if any, in each case as specified in the related Prospectus
Supplement. The 'SPREAD' is the number of basis points (one basis point equals
one one-hundredth of a percentage point) that may be specified in the related
Prospectus Supplement as being applicable to such class, and the 'SPREAD
MULTIPLIER' is the percentage that may be specified in the related Prospectus
Supplement as being applicable to such class.
The related Prospectus Supplement will designate a Base Rate for a given
Floating Rate Security based on the London interbank offered rate ('LIBOR'),
commercial paper rates, Federal funds rates, U.S. Government treasury securities
rates, negotiable certificates of deposit rates or another rate as set forth in
such Prospectus Supplement.
As specified in the related Prospectus Supplement, Floating Rate Securities
of a given class may also have either or both of the following (in each case
expressed as a rate per annum): (i) a maximum limitation, or ceiling, on the
rate at which interest may accrue during any interest period and (ii) a minimum
limitation, or floor, on the rate at which interest may accrue during any
interest period. In addition to any maximum interest rate that may be applicable
to any class of Floating Rate Securities, the interest rate applicable to any
class of Floating Rate Securities will in no event be higher than the maximum
rate permitted by applicable law, as the same may be modified by United States
law of general application.
Each Trust with respect to which a class of Floating Rate Securities will
be issued will appoint, and enter into agreements with, a calculation agent
(each a 'CALCULATION AGENT') to calculate interest rates on each such class of
Floating Rate Securities issued with respect thereto. The related Prospectus
Supplement will set forth the identity of the Calculation Agent for each such
class of Floating Rate Securities of a given series, which may be either the
Trustee or any Indenture Trustee with respect to such series. All determinations
of interest by the
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Calculation Agent shall, in the absence of manifest error, be conclusive for all
purposes and binding on the holders of Floating Rate Securities of a given
class. Unless otherwise specified in the related Prospectus Supplement, all
percentages resulting from any calculation of the rate of interest on a Floating
Rate Security will be rounded, if necessary, to the nearest 1/100,000 of 1%
(.0000001), with five one-millionths of a percentage point rounded upward.
INDEXED SECURITIES
To the extent so specified in any Prospectus Supplement, any class of
Securities of a given series may consist of Securities ('INDEXED SECURITIES') in
which the principal amount payable at the final scheduled Payment Date or
Distribution Date, as the case may be, for such class (the 'INDEXED PRINCIPAL
AMOUNT') is determined by reference to a measure (the 'INDEX') which will be
related to (i) the difference in the rate of exchange between United States
dollars and a currency or composite currency (the 'INDEXED CURRENCY') specified
in the related Prospectus Supplement (such Indexed Securities, 'CURRENCY INDEXED
SECURITIES'); (ii) the difference in the price of a specified commodity (the
'INDEXED COMMODITY') on specified dates (such Indexed Securities, 'COMMODITY
INDEXED SECURITIES'); (iii) the difference in the level of a specified stock
index (the 'STOCK INDEX'), which may be based on U.S. or foreign stocks, on
specified dates (such Indexed Securities, 'STOCK INDEXED SECURITIES'); or (iv)
such other objective price or economic measures as are described in the related
Prospectus Supplement. The manner of determining the Indexed Principal Amount of
an Indexed Security and historical and other information concerning the Indexed
Currency, the Indexed Commodity, the Stock Index or other price or economic
measures used in such determination will be set forth in the related Prospectus
Supplement, together with information concerning tax consequences to the holders
of such Indexed Securities.
If the determination of the Indexed Principal Amount of an Indexed Security
is based on an Index calculated or announced by a third party and such third
party either suspends the calculation or announcement of such Index or changes
the basis upon which such Index is calculated (other than changes consistent
with policies in effect at the time such Indexed Security was issued and
permitted changes described in the related Prospectus Supplement), then such
Index shall be calculated for purposes of such Indexed Security by an
independent calculation agent named in the related Prospectus Supplement on the
same basis, and subject to the same conditions and controls, as applied to the
original third party. If for any reason such Index cannot be calculated on the
same basis and subject to the same conditions and controls as applied to the
original third party, then the Indexed Principal Amount of such Indexed Security
shall be calculated in the manner set forth in the related Prospectus
Supplement. Any determination of such independent calculation agent shall in the
absence of manifest error be binding on all parties.
Unless otherwise specified in the related Prospectus Supplement, interest
on an Indexed Security will be payable based on the amount designated in the
related Prospectus Supplement as the 'FACE AMOUNT' of such Indexed Security. The
related Prospectus Supplement will describe whether principal amount of the
related Indexed Security, if any, that would be payable upon redemption or
repayment prior to the applicable final scheduled Payment Date or Distribution
Date, as the case may be, will be the Face Amount of such Indexed Security, the
Indexed Principal Amount of such Indexed Security at the time of redemption or
repayment or another amount described in such Prospectus Supplement.
BOOK-ENTRY REGISTRATION
Securityholders may hold their Securities through DTC (in the United
States) or Cedel or Euroclear (in Europe), which in turn hold through DTC, if
they are participants of such systems, or indirectly through organizations that
are participants in such systems.
The Seller has been informed by DTC that DTC's nominee will be Cede, unless
another nominee is specified in the related Prospectus Supplement. Accordingly,
such nominee is expected to be the holder of record of any Book-Entry Securities
of any class or series. Unless and until Definitive Securities are issued under
the limited circumstances described herein or in the related Prospectus
Supplement, no Securityholder will be entitled to receive a physical certificate
representing its interest in such Security. All references herein and in the
related Prospectus Supplement to actions by Securityholders refer to actions
taken by DTC upon instructions
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from its Participants and all references herein and in the related Prospectus
Supplement to distributions, notices, reports and statements to Securityholders
of Book-Entry Securities refer to distributions, notices, reports and statements
to DTC or its nominee, as the registered holder of the applicable Securities,
for distribution to Securityholders in accordance with DTC's procedures with
respect thereto. See '--Definitive Securities' herein.
Cedel and Euroclear will hold omnibus positions on behalf of the Cedel
Participants and the Euroclear Participants, respectively, through customers'
securities accounts in Cedel's and Euroclear's names on the books of their
respective depositaries (collectively, the 'DEPOSITARIES') which in turn will
hold such positions in customers' securities accounts in the Depositaries' names
on the books of DTC.
DTC is a limited-purpose trust company organized under the laws of the
State of New York, 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
Exchange Act. DTC was created to hold securities for its Participants and
facilitate the clearance and settlement of securities transactions between
Participants through electronic book-entry changes in accounts of its
Participants, thereby eliminating the need for physical movement of
certificates. Participants include securities brokers and dealers (who may
include an underwriter with respect to any series), banks, trust companies and
clearing corporations and may include certain other organizations, including
Cedel and Euroclear. Indirect access to the DTC system also is available to
Indirect Participants such as banks, brokers, dealers and trust companies that
clear through or maintain a custodial relationship with a Participant, either
directly or indirectly.
Transfers between Participants will occur in accordance with DTC rules.
Transfers between Cedel Participants and Euroclear Participants will occur in
the ordinary way in accordance with their applicable rules and operating
procedures.
Cross-market transfers between persons holding directly or indirectly
through DTC in the United States, on the one hand, and directly or indirectly
through Cedel Participants or Euroclear Participants, on the other, will be
effected in DTC in accordance with DTC rules on behalf of the relevant European
international clearing system by its Depositary; however, such cross-market
transactions will require delivery of instructions to the relevant European
international clearing system by the counterparty in such system in accordance
with its rules and procedures and within its established deadlines (European
time). The relevant European international clearing system will, if the
transaction meets its settlement requirements, deliver instructions to its
Depositary to take action to effect final settlement on its behalf by delivering
or receiving securities in DTC, and making or receiving payment in accordance
with normal procedures for same-day funds settlement applicable to DTC. Cedel
Participants and Euroclear Participants may not deliver instructions directly to
the Depositaries.
Because of time-zone differences, credits or securities in Cedel or
Euroclear as a result of a transaction with a Participant will be made during
the subsequent securities settlement processing, dated the business day
following the DTC settlement date, and such credits or any transactions in such
securities settled during such processing will be reported to the relevant Cedel
Participant or Euroclear Participant on such business day. Cash received in
Cedel or Euroclear as a result of sales of securities by or through a Cedel
Participant or Euroclear Participant to a Participant will be received with
value on the DTC settlement date but will be available in the relevant Cedel or
Euroclear cash account only as of the business day following settlement in DTC.
A 'SECURITYHOLDER,' as used herein, shall mean a holder of a beneficial
interest in a Book-Entry Security. Unless otherwise provided in the related
Prospectus Supplement, Securityholders that are not Participants or Indirect
Participants but desire to purchase, sell or otherwise transfer ownership of, or
other interest in, Securities may do so only through Participants and Indirect
Participants. In addition, Securityholders will receive all distributions of
principal of and interest on Securities from the related Trustee or Indenture
Trustee, as applicable (the 'APPLICABLE TRUSTEE'), through the Participants, who
in turn will receive them from DTC. Under a book-entry format, Securityholders
may experience some delay in their receipt of payments, since such payments will
be forwarded by the Applicable Trustee to Cede, as nominee for DTC. DTC will
forward such payments to its Participants which thereafter will forward them to
Indirect Participants or Securityholders. It is anticipated that the only
'Noteholder' and 'Certificateholder' will be Cede, as nominee of DTC.
Securityholders will not be recognized by the Trustee as Noteholders
('NOTEHOLDERS') or Certificateholders ('CERTIFICATEHOLDERS'), as such term is
used in the related Pooling and Servicing Agreement or Trust Agreement and
Indenture, as
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applicable, and Securityholders will only be permitted to exercise the rights of
Securityholders indirectly through DTC, Cedel or Euroclear and their respective
participants or organizations.
Under the rules, regulations and procedures creating and affecting DTC and
its operations (the 'RULES'), DTC is required to make book-entry transfers of
Securities among Participants on whose behalf it acts with respect to the
Securities and to receive and transmit distributions of principal of, and
interest on, the Securities. Participants and Indirect Participants with which
Securityholders have accounts with respect to the Securities similarly are
required to make book-entry transfers and receive and transmit such payments on
behalf of their respective Securityholders. Accordingly, although
Securityholders will not physically possess Securities, the Rules provide a
mechanism by which Participants will receive payments and will be able to
transfer their interests.
Because DTC can only act on behalf of Participants, who in turn act on
behalf of Indirect Participants and certain banks, the ability of a
Securityholder to pledge Securities to persons or entities that do not
participate in the DTC system, or to otherwise act with respect to such
Securities, may be limited due to the lack of physical certificates for such
Securities.
DTC has advised the Seller that it will take any action permitted to be
taken by a Noteholder under the related Indenture or a Certificateholder under
the related Trust Agreement or Pooling and Servicing Agreement, as applicable,
only at the direction of one or more Participants to whose accounts with DTC the
applicable Notes or Certificates are credited. DTC has advised the Seller that
it will take any actions permitted to be taken by a Noteholder under the related
Indenture or a Certificateholder under the related Trust Agreement or Pooling
and Servicing Agreement, as applicable, only at the direction of one or more
Participants to whose accounts with DTC the applicable Notes or Certificates are
credited. DTC may take conflicting actions with respect to other undivided
interests to the extent that such actions are taken on behalf of Participants
whose holdings include such undivided interests.
Cedel Bank, societe anonyme ('CEDEL') is incorporated under the laws of
Luxembourg as a professional depository. Cedel holds securities for its
participating organizations ('CEDEL PARTICIPANTS') and facilitates the clearance
and settlement of securities transactions between Cedel Participants through
electronic book-entry changes in accounts of Cedel Participants, thereby
eliminating the need for physical movement of certificates. Transactions may be
settled by Cedel in any of 28 currencies, including United States dollars. Cedel
provides to its Cedel Participants, among other things, services for
safekeeping, administration, clearance and settlement of internationally traded
securities and securities lending and borrowing. Cedel interfaces with domestic
markets in several countries. As a professional depository, Cedel is subject to
regulations by the Luxembourg Monetary Institute. Cedel Participants are
recognized financial institutions around the world, including underwriters,
securities brokers and dealers, banks, trust companies, clearing corporations
and certain other organizations and may include an underwriter of any series.
Indirect access to Cedel is also available to others, such as banks, brokers,
dealers and trust companies that clear through or maintain a custodial
relationship with a Cedel Participant, either directly or indirectly.
The Euroclear System ('EUROCLEAR') was created in 1968 to hold securities
for participants of Euroclear ('EUROCLEAR PARTICIPANTS') and to clear and settle
transactions between Euroclear Participants through simultaneous electronic
book-entry delivery against payment, thereby eliminating the need for physical
movement of certificates and any risk from lack of simultaneous transfers of
securities and cash. Transactions may now be settled in any of 27 currencies,
including United States dollars. Euroclear includes various other services,
including securities lending and borrowing and interfaces with domestic markets
in several countries generally similar to the arrangement for cross-market
transfers with DTC described above. Euroclear is operated by Morgan Guaranty
Trust Company of New York, Brussels, Belgium office (the 'EUROCLEAR OPERATOR'),
under contract with Euroclear Clearance System, S.C., a Belgian cooperative
corporation (the 'COOPERATIVE'). All operations are conducted by the Euroclear
Operator, and all Euroclear securities clearance accounts and Euroclear cash
accounts are accounts with the Euroclear Operator, not the Cooperative. The
Cooperative establishes policy for Euroclear on behalf of Euroclear
Participants. Euroclear Participants include banks (including central banks),
securities brokers and dealers and other professional financial intermediaries
and may include an underwriter of any series. Indirect access to Euroclear is
also available to other firms that clear through or maintain a custodial
relationship with a Euroclear Participant, either directly or indirectly.
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The Euroclear Operator is the Belgian branch of a New York banking
corporation which is a member of the Federal Reserve System. As such, it is
regulated and examined by the Board of Governors of the Federal Reserve System
and the New York State Banking Department, as well as the Belgian Banking
Commission.
Securities clearance accounts and cash accounts with the Euroclear Operator
are governed by the Terms and Conditions Governing Use of Euroclear and the
related Operating Procedures of Euroclear and applicable Belgian law
(collectively, the 'TERMS AND CONDITIONS'). The Terms and Conditions govern
transfers of securities and cash within Euroclear, withdrawal of securities and
cash from Euroclear, and receipts of payments with respect to securities in
Euroclear. All securities in Euroclear are held on a fungible basis without
attribution of specific certificates to specific securities clearance accounts.
The Euroclear Operator acts under the Terms and Conditions only on behalf of
Euroclear Participants and has no record of or relationship with persons holding
through Euroclear Participants.
Distributions with respect to Securities held through Cedel or Euroclear
will be credited to the cash accounts of Cedel Participants or Euroclear
Participants in accordance with the relevant system's rules and procedures, to
the extent received by its Depositary. Such distributions will be subject to tax
reporting in accordance with relevant United States tax laws and regulations.
Cedel or the Euroclear Operator, as the case may be, will take any other action
permitted to be taken by a Securityholder under the related Indenture (if any),
Trust Agreement or Pooling and Servicing Agreement, as applicable, on behalf of
a Cedel Participant or a Euroclear Participant only in accordance with its
relevant rules and procedures and subject to its Depositary's ability to effect
such actions on its behalf through DTC.
Although DTC, Cedel and Euroclear have agreed to the foregoing procedures
in order to facilitate transfers of Certificates among participants of DTC,
Cedel and Euroclear, they are under no obligation to perform or continue to
perform such procedures, and such procedures may be discontinued at any time.
Except as required by law, no Trustee will have any liability for any
aspect of the records relating to or payments made on account of beneficial
ownership interests of the Securities of any series held by DTC, Cedel or
Euroclear or for maintaining, supervising or reviewing any records relating to
such beneficial ownership interests.
DEFINITIVE SECURITIES
Unless otherwise specified in the related Prospectus Supplement, any Notes
or Certificates of a given series issued in book-entry form will be issued in
fully registered, certificated form ('DEFINITIVE NOTES' or 'DEFINITIVE
CERTIFICATES,' as the case may be, and collectively referred to herein as
'DEFINITIVE SECURITIES') to Noteholders or Certificateholders or their
respective nominees rather than to the Depository or its nominee, only if (i)
the Servicer advises the applicable Trustee in writing that the Depository is no
longer willing or able to discharge properly its responsibilities as depository
with respect to such Securities and such Trustee is unable to locate a qualified
successor depository, (ii) the Servicer at its option, elects to terminate the
book-entry system through the Depository or (iii) after the occurrence of an
Event of Default or an Event of Servicing Termination with respect to such
Securities, holders representing at least a majority of the outstanding
principal amount of the related Notes or the Certificates, as applicable, of
such series advise the Depository through Participants in writing (with
instructions to notify the applicable Trustee in writing) that the continuation
of a book-entry system through the Depository (or a successor thereto) with
respect to such Notes or Certificates is no longer in the best interest of the
holders of such Securities.
Upon the occurrence of any event described in the immediately preceding
paragraph, the Depository will be required to notify all applicable
Securityholders of a given series through Participants of the availability of
Definitive Securities. Upon surrender by the Depository of the definitive
certificates representing the corresponding Securities and receipt of
instructions for re-registration, the appropriate Trustee will reissue such
Securities as Definitive Securities to such Securityholders.
Distributions of principal with respect to, and interest on, such
Definitive Securities will thereafter be made in accordance with the procedures
set forth in the related Indenture, Trust Agreement or Pooling and Servicing
Agreement, as applicable, directly to holders of Definitive Securities in whose
names the Definitive Securities were registered at the close of business on the
applicable record date specified for such Securities in the related Prospectus
Supplement. Such distributions will be made by check mailed to the address of
such holder as it appears on the register maintained by the related Trustee or
Indenture Trustee, as applicable. The final payment on any such Definitive
Security (whether a Definitive Security or the Securities registered in the name
of Cede
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representing the Securities), however, will be made only upon presentation and
surrender of such Definitive Security at the office or agency specified in the
notice of final distribution to the applicable Securityholders.
Definitive Securities will be transferable and exchangeable at the offices
of the related transfer agent and registrar for such series, which, unless
otherwise specified in the related Prospectus Supplement, shall initially be
Chase (in such capacity, the 'TRANSFER AGENT AND REGISTRAR'). No service charge
will be imposed for any registration of transfer or exchange, but the Applicable
Trustee may require payment of a sum sufficient to cover any tax or other
governmental charge imposed in connection therewith.
LIST OF SECURITYHOLDERS
Three or more holders of the Notes of any series (each of whom has owned a
Note for at least six months) may, by written request to the related Indenture
Trustee, obtain access to the list of all Noteholders of such series maintained
by such Indenture Trustee for the purpose of communicating with other
Noteholders of such series with respect to their rights under such Indenture or
such Notes. Such Indenture Trustee may elect not to afford the requesting
Noteholders access to the list of such Noteholders if it agrees to mail the
desired communication or proxy, on behalf and at the expense of the requesting
Noteholders, to all Noteholders of record. Unless Definitive Notes have been
issued, the only 'Noteholder' appearing on the list maintained by the related
Indenture Trustee will be Cede, as nominee for DTC. In such circumstances, any
beneficial owner of a Note wishing to communicate with other beneficial owners
of Notes will not be able to identify those beneficial owners through the
Indenture Trustee and instead will have to attempt to identify them through DTC
and its Participants or such other means as such beneficial owner may find
available.
Three or more Certificateholders of any series or one or more
Certificateholders evidencing not less than 25% of the Certificate Balance of
such series may, by written request to the applicable related Trustee or
Certificate Registrar, obtain access to the list of all Certificateholders of
such series for the purpose of communicating with such Certificateholders with
respect to their rights under the related Trust Agreement or Pooling and
Servicing Agreement, as applicable, or under such Certificates. Unless
Definitive Certificates have been issued, the only 'Certificateholder' appearing
on the list maintained by the related Trustee will be Cede, as nominee for DTC.
In such circumstances, any beneficial owner of a Certificate wishing to
communicate with other beneficial owners of Certificates will not be able to
identify those beneficial owners through the related Trustee and instead will
have to attempt to identify them through DTC and its Participants or such other
means as such beneficial owner may find available.
REPORTS TO SECURITYHOLDERS
With respect to each series of Securities, on each Payment Date or
Distribution Date, as applicable, the Paying Agent will include with each
distribution to each Noteholder (if any) and/or Certificateholder (if any) a
statement prepared by the Servicer. With respect to each series of Securities,
each such statement to be delivered to Noteholders will include (to the extent
applicable), among other things, the following information (and any other
information so specified in the related Prospectus Supplement) as to the Notes
of such series with respect to such Payment Date or the period since the
previous Payment Date, as applicable, and each such statement to be delivered to
Certificateholders will include (to the extent applicable) the following
information (and any other information so specified in the related Prospectus
Supplement) as to the Certificates of such series with respect to such
Distribution Date or the period since the previous Distribution Date, as
applicable:
(i) the amount of the distribution allocable to principal with respect
to each class of such Notes and to the Certificate Balance of each class of
such Certificates and the derivation of such amounts;
(ii) the amount of the distribution allocable to interest on or with
respect to each class of Notes and each class of Certificates of such
series;
(iii) amount of the Servicing Fee paid to the Servicer in respect of
the related Collection Period;
(iv) the amount of the Administration Fee paid to the Administrator in
respect of the related Collection Period;
(v) the aggregate unreimbursed Advances as of the last day of the
preceding Collection Period and the change in such amount from the previous
Collection Period;
(vi) the Pool Balance as of the close of business on the last day of
the preceding Collection Period;
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(vii) the aggregate outstanding principal balance and the Note Pool
Factor for each class of such Notes, and the Certificate Balance and the
Certificate Pool Factor for each class of such Certificates, in each case
after giving effect to all payments reported under clause (i) above on such
date;
(viii) the Interest Rate or Pass Through Rate for the next period with
respect to any class of Notes or any class of Certificates of such series
with variable or adjustable rates;
(ix) the amount of the aggregate realized losses, if any, for the
preceding Collection Period;
(x) the Noteholders' Interest Carryover Shortfall, the Noteholders'
Principal Carryover Shortfall, the Certificateholders' Interest Carryover
Shortfall and the Certificateholders' Principal Carryover Shortfall (each
as defined in the related Prospectus Supplement), if any, in each case as
applicable to each class of Securities and the change in such amounts from
the preceding statement;
(xi) the aggregate Purchase Amounts with respect to the Receivables,
if any, that were repurchased by the Seller or purchased by the Servicer in
such Collection Period;
(xii) the balance of the Reserve Account (if any) or any other
enhancement account, as of such date, after giving effect to changes
therein on such date, the Specified Reserve Account Balance on such date
(as defined in the related Prospectus Supplement) or any other required
enhancement account balance on such date, and the components of calculating
any such required balance;
(xiii) the balance of the Cash Collateral Account, if any, the
Available Cash Collateral Amount (and such amount expressed as a percentage
of the related Pool Balance) and the related Required Cash Collateral
Amount (each as defined in the related Prospectus Supplement);
(xiv) for each such date during the Funding Period, if any, the
remaining Pre-Funded Amount;
(xv) for the first such date that is on or immediately following the
end of the Funding Period, if any, the amount of any remaining Pre-Funded
Amount that has not been used to fund the purchase of Subsequent
Receivables and is being passed through as payments of principal on the
Securities of such series; and
(xvi) the balance in the Paid-Ahead Account, if any.
Each amount set forth pursuant to subclauses (i), (ii), (iii) and (iv) with
respect to the Notes or the Certificates of any series will be expressed as a
dollar amount per $1,000 of the initial principal balance of such Notes or the
initial Certificate Balance of such Certificates, as applicable.
Unless otherwise specified in the related Prospectus Supplement, the
statements for each Collection Period will be delivered to DTC for further
distribution to Securityholders in accordance with DTC procedures. See 'Certain
Information Regarding the Securities--Book-Entry Registration' herein. The
Servicer, on behalf of each Trust, will file with the Commission such periodic
reports with respect to each Trust as required under the Exchange Act and the
rules and regulations of the Commission thereunder.
Within the prescribed period of time for tax reporting purposes after the
end of each calendar year during the term of each Trust, the Trustee or the
Paying Agent will furnish to each person who at any time during such calendar
year has been a Noteholder or Certificateholder with respect to such Trust and
received any payment thereon a statement containing certain information for the
purposes of such Securityholder's preparation of federal income tax returns. See
'Certain Federal Income Tax Consequences' in the related Prospectus Supplement.
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DESCRIPTION OF THE TRANSFER AND SERVICING AGREEMENTS
The following summary describes certain terms of (i) each Sale and
Servicing Agreement (or in the case of a Trust not issuing Notes, each Pooling
and Servicing Agreement) pursuant to which each Trust will acquire Receivables
from the Seller and the Servicer will agree to service such Receivables; (ii)
each Trust Agreement (or, in the case of a Trust not issuing Notes, each Pooling
and Servicing Agreement) pursuant to which each Trust will be created and (iii)
each Administration Agreement pursuant to which Chase will undertake certain
administrative duties with respect to each Trust that issues Notes
(collectively, the 'TRANSFER AND SERVICING AGREEMENTS'). Forms of the Transfer
and Servicing Agreements have been filed as exhibits to the Registration
Statement of which this Prospectus forms a part. The following summary, as well
as other pertinent information included elsewhere in this Prospectus and in the
related Prospectus Supplement, describes the material terms of the Transfer and
Servicing Agreements related to any series. This summary does not purport to be
complete and is subject to, and is qualified in its entirety by reference to,
the provisions of such Transfer and Servicing Agreements.
SALE AND ASSIGNMENT OF RECEIVABLES
On or before the closing date specified with respect to any given Trust in
the related Prospectus Supplement (the 'CLOSING DATE'), the Seller will transfer
and assign in consideration of the receipt of the related Securities, without
recourse, to the related Trust pursuant to a Sale and Servicing Agreement or to
the related Trustee pursuant to a Pooling and Servicing Agreement, as
applicable, its entire interest in the Initial Receivables, if any, certain
related property and the proceeds thereof of the related Receivables Pool,
including, among other things, its security interests in the related Financed
Vehicles. Each such Receivable will be identified in a schedule appearing as an
exhibit to such Sale and Servicing Agreement or Pooling and Servicing Agreement
(a 'SCHEDULE OF RECEIVABLES'). The Seller will sell the related Securities
offered hereby to the respective underwriters set forth in the Prospectus
Supplement. See 'Plan of Distribution.' To the extent specified in the related
Prospectus Supplement, a portion of the net proceeds received from the sale of
the Securities of a given series will be applied to the deposit of the
Pre-Funded Amount into the Pre-Funding Account and/or to the initial deposit
into a Reserve Account, a Cash Collateral Account or a Yield Supplement Account,
if any. The related Prospectus Supplement for each Trust will specify whether,
and the terms, conditions and manner under which, Subsequent Receivables will be
sold by the Seller to the related Trust from time to time during any Funding
Period on each date specified as a transfer date in the related Prospectus
Supplement (each, a 'SUBSEQUENT TRANSFER DATE').
Each Sale and Servicing Agreement or Pooling and Servicing Agreement, as
applicable, will set forth criteria that must be satisfied by each Receivable.
Unless the related Prospectus Supplement specifies that certain of the criteria
set forth below are not required to be satisfied, the criteria will include,
among others, the following: (a) each Receivable (i) in the case of a Receivable
originated with the involvement of a Dealer, has been originated in the form of
a credit sales transaction by a Dealer or a purchase money loan through a Dealer
located in one of the States of the United States (including the District of
Columbia) for the retail financing of a Financed Vehicle or (ii) in the case of
a Receivable originated without the involvement of a Dealer, has been originated
by the Originating Bank in the form of a secured loan for the retail financing
of a Financed Vehicle, and, in each case, has been fully and properly executed
by the parties thereto; (b) (i) in the case of a Receivable originated with the
involvement of a Dealer, if a retail installment sales contract, has been
purchased by the Seller from the originating Dealer and has been validly
assigned by such Dealer or the Originating Bank to the Seller in accordance with
its terms or (ii) in the case of a Receivable originated by Chase without the
involvement of a Dealer, has been purchased by the Seller from Chase, and has
been validly assigned by Chase to the Seller; (c) contains customary and
enforceable provisions such that the rights and remedies of the holder thereof
shall be adequate for realization against the collateral or the benefits of the
security; (d) each Receivable not a Final Payment Receivable provides for fully
amortizing level scheduled monthly payments (provided that the last payment may
be different from the level scheduled payment) and for accrual of interest at a
fixed rate according to the simple interest or actuarial method; (e) each
Receivable and each sale of the related Financed Vehicle complies in all
material respects with all requirements of applicable federal, state and local
laws and regulations thereunder, including usury laws, the Federal
Truth-in-Lending Act, the Equal Credit Opportunity Act, the Fair Credit
Reporting Act, the Federal Trade Commission Act, the Magnuson-Moss Warranty Act,
Federal Reserve Board Regulations B and Z, state adaptations of the National
Consumer Act and of the Uniform Consumer Credit Code and any other consumer
credit, equal opportunity and disclosure laws applicable to such Receivable and
the
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sale thereof; (f) each Receivable constitutes the legal, valid and binding
payment obligation in writing of the Obligor, enforceable by the holder thereof
in all material respects in accordance with its terms, subject, as to
enforcement, to applicable bankruptcy, insolvency, reorganization, liquidation
and other similar laws and equitable principles relating to or affecting the
enforcement of creditors' rights; (g) subject to certain limited exceptions
specified in the Sale and Servicing Agreement or Pooling and Servicing
Agreement, as applicable, immediately prior to the sale and assignment thereof
to the Trustee, each Receivable was secured by a validly
perfected first priority security interest in the related Financed Vehicle in
favor of the Originating Bank as secured party, which security interest is
assignable and has been so assigned by the Seller to the related Trust; (h) as
of the related Cutoff Date, the Seller had no knowledge either of any facts
which would give rise to any right of rescission, setoff, counterclaim, or
defense, or of the same being asserted or threatened, with respect to any
Receivable; (i) as of the related Cutoff Date, the Seller had no knowledge of
any liens or claims that have been filed, including liens for work, labor,
materials or unpaid taxes relating to a Financed Vehicle, that would be liens
prior to, or equal or coordinate with, the lien granted by the Receivable; (j)
except for payment defaults continuing for a period of not more than 30 days as
of the related Cutoff Date, (i) the Seller has no knowledge that a default,
breach, violation, or event permitting acceleration under the terms of any
Receivable exists, (ii) the Seller has no knowledge that a continuing condition
that with notice or lapse of time would constitute a default, breach, violation
or event permitting acceleration under the terms of any Receivable exists and
(iii) the Seller has not waived any of the foregoing; (k) each Receivable
requires that the Obligor thereunder obtain comprehensive, liability, theft and
physical damage insurance covering the related Financed Vehicle; and (l) each
Receivable satisfies the other criteria specified above under 'The Receivables
Pool' and each other criterion set forth in the related Prospectus Supplement.
Unless otherwise provided in the related Prospectus Supplement, as of the
last day of the month following the date (or, if the Seller elects, the last day
of the month including such date) on which the Seller discovers or receives
written notice from the related Trustee or any Indenture Trustee that a
Receivable does not meet any of the criteria set forth in the related Sale and
Servicing Agreement or Pooling and Servicing Agreement, as applicable, and such
failure materially and adversely affects the interests of the related
Securityholders in such Receivable, the Seller, unless it has cured the failed
criterion, will repurchase such Receivable from the related Trust at a price
equal to the unpaid principal balance owed by the Obligor thereof plus interest
thereon at the respective contract rate of interest through the last day of the
month of repurchase (the 'REPURCHASE AMOUNT'). The repurchase obligation will
constitute the sole remedy available to the Certificateholders or the Trustee
and any Noteholders or Indenture Trustee in respect of such Trust for the
failure of a Receivable to meet any of the criteria set forth in the related
Sale and Servicing Agreement or Pooling and Servicing Agreement, as applicable.
Pursuant to each Sale and Servicing Agreement or Pooling and Servicing
Agreement, as applicable, to assure uniform quality in servicing the Receivables
and to reduce administrative costs, the related Trustee or any Indenture Trustee
will appoint the Servicer as initial custodian. Receivables will not be stamped
or otherwise marked to reflect the transfer of the Receivables to a Trust and
will not be segregated from the other Motor Vehicle Loans owned or serviced by
the Servicer. The Obligors under the Receivables will not be notified of the
transfer of the Receivables to a Trust, but the Seller's accounting records and
computer systems will reflect the sale and assignment of the Receivables to such
Trust. See 'Certain Legal Aspects of the Receivables' herein.
ACCOUNTS
With respect to each Trust that issues Notes, the Servicer will establish
and maintain one or more accounts, in the name of the Indenture Trustee on
behalf of the related Noteholders and any Certificateholders, into which all
payments made on or with respect to the related Receivables will be deposited
(the 'COLLECTION ACCOUNT'). The Servicer will also establish and maintain with
such Indenture Trustee an account, in the name of such Indenture Trustee on
behalf of such Noteholders, into which, to the extent and in the manner
described in the related Prospectus Supplement, amounts released from the
Collection Account and any Pre-Funding Account, Cash Collateral Account, Yield
Supplement Account, Reserve Account or other credit or cash flow enhancement for
payment to such Noteholders will be deposited and from which all distributions
to such Noteholders will be made (the 'NOTE DISTRIBUTION ACCOUNT'). With respect
to each Trust that issues certificates, the Servicer will establish and maintain
with the related Trustee an account, in the name of such Trustee on behalf of
such Certificateholders, into which amounts released from the Collection Account
and any Pre-Funding Account, Cash Collateral Account, Yield Supplement Account,
Reserve Account or other credit or cash flow enhancement for
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distribution to such Certificateholders will be deposited and from which all
distributions to such Certificateholders will be made (the 'CERTIFICATE
DISTRIBUTION ACCOUNT'). With respect to each Trust that does not issue Notes,
the Servicer will also establish and maintain the Collection Account and any
other Trust Account in the name of the related Trustee on behalf of the related
Certificateholders.
If so provided in the related Prospectus Supplement, the Servicer may
establish and maintain for the related Trust an additional account (the
'PAID-AHEAD ACCOUNT'), in the name of the related Indenture Trustee or Trustee,
into which, to the extent required by the related Sale and Servicing Agreement
or Pooling and Servicing Agreement, as applicable, early payments by or on
behalf of Obligors on Actuarial Receivables which do not constitute scheduled
payments, full prepayments, nor certain partial prepayments that result in a
reduction of the Obligor's periodic payment below the scheduled payment as of
the applicable Cutoff Date ('PAID-AHEADS') will be deposited until such time as
the Paid-Ahead falls due. Until such time as Paid-Aheads are transferred from
the Paid-Ahead Account to the Collection Account, they will not constitute
collected interest or collected principal and will not be available for
distribution to the related Securityholders. The Paid-Ahead Account, if any,
will initially be maintained with the related Indenture Trustee or Trustee. So
long as the Seller is the Servicer and provided that (i) there exists no Event
of Servicing Termination and (ii) each other condition to holding Paid-Aheads as
may be required by the related Sale and Servicing Agreement or Pooling and
Servicing Agreement, as applicable, is satisfied, Paid-Aheads may be retained by
the Servicer until the applicable Payment Date or Distribution Date.
Any other accounts to be established with respect to a Trust, including any
Pre-Funding Account, Cash Collateral Account, Yield Supplement Account or
Reserve Account will be described in the related Prospectus Supplement.
For any series of Securities, the Collection Account and any Note
Distribution Account, Certificate Distribution Account, Pre-Funding Account,
Cash Collateral Account, Reserve Account, Yield Supplement Account, Paid-Ahead
Account and other accounts identified as such in the related Prospectus
Supplement are collectively referred to herein as the 'TRUST ACCOUNTS.'
The Trust Accounts will be maintained as Eligible Deposit Accounts. An
'ELIGIBLE DEPOSIT ACCOUNT' for any series shall be either (a) a separately
identifiable deposit account established in the deposit taking department of a
Qualified Institution or (b) a segregated identifiable trust account established
in the trust department of a Qualified Trust Institution. A 'QUALIFIED
INSTITUTION' shall be a depository institution (including Chase USA or Chase)
organized under the laws of the United States or any state thereof or
incorporated under the laws of a foreign jurisdiction with a branch or agency
located in the United States or any state thereof and subject to supervision and
examination by federal or state banking authorities, having a short-term
certificate of deposit rating and a long-term unsecured debt rating confirmed by
each Rating Agency as being consistent with the ratings of the related
Securities and, in the case of any such institution (including Chase USA or
Chase) organized under the laws of the United States, the deposits of which are
insured by the FDIC. A 'QUALIFIED TRUST INSTITUTION' shall be an institution
organized under the laws of the United States or any state thereof or
incorporated under the laws of a foreign jurisdiction with a branch or agency
located in the United States and subject to supervision and examination by
federal or state banking authorities with the authority to act under such laws
as a trustee or in any other fiduciary capacity, having not less than $1 billion
in assets under fiduciary management and a long-term deposit rating confirmed by
each Rating Agency as being consistent with the ratings of the related
Securities. Unless the related Prospectus Supplement specifies that a Trust
Account will be established with another institution, each Trust Account will be
established initially with the trust department of Chase. Should Chase or any
depositary of a Trust Account cease to be a Qualified Institution or Qualified
Trust Institution, such Trust Account shall be moved to a Qualified Institution
or Qualified Trust Institution, provided that such Trust Account may remain at
such depositary if each Trustee receives written confirmation from each related
Rating Agency to the effect that the ratings of the related Securities will not
be adversely affected.
If so provided in the related Prospectus Supplement, funds in the Trust
Accounts will be invested as provided in the related Sale and Servicing
Agreement or Pooling and Servicing Agreement, as applicable, in Permitted
Investments. 'PERMITTED INVESTMENTS' are generally limited to investments
confirmed by the related Rating Agencies as being consistent with the rating of
the related Securities. Permitted Investments may include Securities issued by
the Seller or its affiliates or trusts originated by the Seller or its
affiliates, and may also include certain money market mutual funds for which
Chase or any of its affiliates serves as an investment
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advisor, administrator, shareholder servicing agent and/or custodian or
subcustodian (for which it collects fees and expenses). Except as described
below or in the related Prospectus Supplement, Permitted Investments are limited
to obligations or securities that mature on or before the 'BUSINESS DAY' (as
defined in the related Prospectus Supplement) preceding the next Distribution
Date or Payment Date for such series (each such preceding day, a 'DEPOSIT
DATE'). However, to the extent set forth in the related Prospectus Supplement
and consistent with the ratings of the related Securities, funds in any Cash
Collateral Account, Reserve Account or Yield Supplement Account may be invested
in securities that will not mature prior to the next Deposit Date with respect
to such Certificates or Notes and will not be sold to meet any shortfalls. Thus,
the amount of cash in any Cash Collateral Account, Reserve Account or Yield
Supplement Account at any time, for example, may be less than the balance of the
Cash Collateral Account, Reserve Account or Yield Supplement Account. If the
amount required to be withdrawn from any Cash Collateral Account, Reserve
Account or Yield Supplement Account to cover shortfalls in collections on the
related Receivables (as provided in the related Prospectus Supplement) exceeds
the amount of cash in such Cash Collateral Account, Reserve Account or Yield
Supplement Account, a temporary shortfall in the amounts distributed to the
related Securityholders could result, which could, in turn, increase the average
life of the Securities of such series. Except as otherwise specified in the
related Prospectus Supplement, investment earnings on funds deposited in the
Trust Accounts, net of losses and investment expenses (collectively, 'INVESTMENT
EARNINGS'), shall be paid to the Servicer as additional servicing compensation.
Chase, in its capacity as the initial paying agent (the 'PAYING AGENT')
under each related Sale and Servicing Agreement and Indenture or Pooling and
Servicing Agreement, as applicable, will have the revocable right to withdraw
funds from a Trust Account for the purpose of making distributions to
Securityholders in the manner provided therein.
SERVICING PROCEDURES
The Servicer will service the Receivables in each Receivables Pool and will
make reasonable efforts to collect all payments due with respect to such
Receivables and, in a manner consistent with the related Sale and Servicing
Agreement or Pooling and Servicing Agreement, as applicable, and with the terms
of the Receivables, will follow such collection and servicing procedures as it
follows with respect to comparable new or used automobile receivables that it
services for itself and that are consistent with prudent industry standards. The
related Prospectus Supplement, Pooling and Servicing Agreement and Sale and
Servicing Agreement, as applicable, will set forth the terms and conditions in
accordance with which any Receivable may be modified, which terms will be set
forth in the related Prospectus Supplement. Some of such arrangements may result
in the Servicer's purchasing the Receivable for the Repurchase Amount, while
others may result in the Servicer's making Advances. Any such required purchase
or extension will constitute the sole remedy available to the Securityholders or
any related Trustee for any such uncured breach.
Each Sale and Servicing Agreement and Pooling and Servicing Agreement, as
applicable, will provide that the Servicer, on behalf of the related Trust,
shall use reasonable efforts, consistent with its customary servicing
procedures, to repossess or otherwise take possession of the Financed Vehicle
securing any Receivable with respect to which the Servicer shall have
determined, during any Collection Period, that eventual payment in full of the
amount financed (including accrued interest thereon) is unlikely (each such
Receivable, a 'DEFAULTED RECEIVABLE'); provided that no Receivable will become a
Defaulted Receivable any later than the calendar month in which more than 10% of
a scheduled payment of the Motor Vehicle Loan becomes 240 days delinquent. See
'The Receivables Pools--Insurance and Collection Procedures' herein. The
Servicer shall follow such customary and usual practices and procedures as it
shall deem necessary or advisable in its servicing of new or used automobile
receivables, which may include reasonable efforts to realize upon any recourse
to Dealers, consigning the Financed Vehicle to a Dealer for resale and selling
the Financed Vehicle at public or private sale. See 'Certain Legal Aspects of
the Receivables' herein. The proceeds of any such realization will be deposited
in the related Collection Account.
COLLECTIONS
With respect to each Trust, the Servicer will deposit all payments on the
related Receivables (from whatever source) and all proceeds of such Receivables
collected during each collection period specified in the related Prospectus
Supplement (each, a 'COLLECTION PERIOD') into the related Collection Account on
a daily basis
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within forty-eight hours of receipt. However, at any time that and for so long
as (i) the Seller is also the Servicer, and (ii) each other condition to making
deposits less frequently than daily as may be confirmed by the related Rating
Agencies or any enhancement provider or as set forth in the related Prospectus
Supplement is satisfied, the Servicer will not be required to deposit such
amounts into the Collection Account until on or before the Deposit Date
preceding the related Distribution Date or Payment Date. Pending deposit into
the Collection Account, collections may be invested by the Servicer at its own
risk and for its own benefit and will not be segregated from its own funds. If
the Servicer were unable to remit such funds, Securityholders might incur a
loss. To the extent set forth in the related Prospectus Supplement, the Servicer
may, in order to satisfy the requirements described above, obtain letters of
credit or other security for the benefit of the related Trust to secure timely
remittances of collections on the related Receivables and payment of the
aggregate Repurchase Amount with respect to Receivables purchased by the
Servicer.
SERVICING COMPENSATION AND PAYMENT OF EXPENSES
Unless otherwise specified in the related Prospectus Supplement with
respect to any Trust, the Servicer will be entitled to receive the Servicing Fee
for each Collection Period payable on the related Distribution Date in an amount
equal to the sum of (i) the product of one-twelfth of the specified percentage
per annum (as set forth in the related Prospectus Supplement, the 'SERVICING FEE
RATE') and the Pool Balance as of the close of business on the last day of the
second Collection Period preceding the Collection Period in which such
Distribution Date occurs and (ii) unless otherwise specified in the related
Prospectus Supplement with respect to any Trust, any Late Fees collected during
the related Collection Period (collectively, the 'SERVICING FEE'). The Servicing
Fee will also include Investment Earnings to the extent set forth in the related
Prospectus Supplement. The Servicing Fee (together with any portion of the
Servicing Fee that remains unpaid from prior Distribution Dates or Payments
Dates) will be paid solely to the extent of amounts allocable thereto as
specified in the related Prospectus Supplement. The Servicer will be entitled to
reimbursement from each Trust for certain liabilities.
'LATE FEES' shall mean, collectively, any late charges, credit-related
extension fees, non-credit related extension fees or other administrative fees
or similar charges allowed by applicable law with respect to the related
Receivables.
The Servicing Fee will compensate the Servicer for performing the functions
of a third-party servicer of motor vehicle receivables as an agent for the
Noteholders and Certificateholders, including collecting and posting all
payments and responding to inquiries of Obligors, investigating delinquencies,
reporting tax information to Obligors, advancing costs of disposition of
defaults. The Servicing Fee also will compensate the Servicer for administering
the particular Receivables Pool, accounting for collections and furnishing
monthly and annual statements to the related Trustee with respect to
distributions. The Servicing Fee will also compensate the Servicer for certain
taxes, accounting fees, outside auditor fees, the fees of the Paying Agent, the
Transfer Agent, the Registrar and the Trustee and its counsel, data processing
costs and other costs incurred in connection with administering the applicable
Receivables Pool.
ADVANCES
The Prospectus Supplement may provide that the Servicer may, in its sole
discretion, make a payment (an 'ADVANCE') with respect to each delinquent
Receivable in the related Receivables Pool in an amount described in such
Prospectus Supplement. The Servicer may elect not to make any Advance with
respect to a Receivable under the circumstances described in the related
Prospectus Supplement. The Servicer will be entitled to be reimbursed for
outstanding Advances in the manner described in the related Prospectus
Supplement. The Servicer will deposit all Advances with respect to any Payment
Date or Distribution Date, as applicable, on the related Deposit Date.
DISTRIBUTIONS
With respect to each series of Securities, beginning on the Payment Date or
Distribution Date, as applicable, specified in the related Prospectus
Supplement, distributions of principal and interest (or, where applicable, of
principal or interest only) on each class of such Securities entitled thereto
will be made by the applicable related Trustee or Paying Agent to the
Noteholders and the Certificateholders of such series. The timing, calculation,
allocation, order, source, priorities of and requirements for all payments to
any class of Noteholders of such
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series and all distributions to any class of Certificateholders of such series
will be set forth in the related Prospectus Supplement.
With respect to each Trust, on each Payment Date and Distribution Date, as
applicable, collections on the related Receivables will be transferred from the
Collection Account directly to the Note Distribution Account, if any, and the
Certificate Distribution Account, if any, for distribution to Noteholders and
Certificateholders to the extent provided in the related Prospectus Supplement.
Credit enhancement, such as a Cash Collateral Account, Reserve Account or Yield
Supplement Account, will be available to cover any shortfalls in the amount
available for distribution on such date to the extent specified in the related
Prospectus Supplement. As more fully described in the related Prospectus
Supplement, and unless otherwise specified therein, distributions in respect of
principal of a class of Securities of a given series will be subordinate to
distributions in respect of interest on such class, and distributions in respect
of one or more classes of Securities of such series may be subordinate to
payments in respect of one or more other classes of Securities of such series.
CREDIT AND CASH FLOW ENHANCEMENT
The amounts and types of credit and cash flow enhancement arrangements, if
any, and the provider thereof, if applicable, with respect to each class of
Securities of a given series will be set forth in the related Prospectus
Supplement. If and to the extent provided in the related Prospectus Supplement,
credit and cash flow enhancement may be in the form of subordination of one or
more classes of Securities, a Cash Collateral Guaranty supported by a Cash
Collateral Account, a Reserve Account, a Yield Supplement Agreement, a Yield
Supplement Account, over-collateralization, letters of credit, credit or
liquidity facilities, surety bonds, guaranteed investment contracts, swaps or
other interest rate protection agreements, repurchase obligations, other
agreements with respect to third party payments or other support, cash deposits
or such other arrangements as may be described in the related Prospectus
Supplement or any combination of two or more of the foregoing. If specified in
the related Prospectus Supplement, credit or cash flow enhancement for a class
of Securities may cover one or more other classes of Securities of the same
series, and credit or cash flow enhancement for a series of Securities may cover
one or more other series of Securities.
The presence of a Cash Collateral Guaranty, a Yield Supplement Agreement, a
Reserve Account, a Yield Supplement Account and other forms of credit
enhancement for the benefit of any class or series of Securities is intended to
enhance the likelihood of receipt by the Securityholders of such class or series
of the full amount of principal and interest due thereon and to decrease the
likelihood that such Securityholders will experience losses. Unless otherwise
specified in the related Prospectus Supplement, the credit enhancement for a
class or series of Securities will not provide protection against all risks of
loss and will not guarantee repayment of the entire principal balance and
interest thereon. If losses occur that exceed the amount covered by any credit
enhancement or that are not covered by any form of credit enhancement,
Securityholders of any class or series will bear their allocable share of
deficiencies, as described in the related Prospectus Supplement. In addition, if
a form of credit enhancement covers more than one series of Securities,
Securityholders of any such series will be subject to the risk that such credit
enhancement will be exhausted by the claims of Securityholders of other series.
The Seller may replace or reduce the credit enhancement for any class of
Securities with another form of credit enhancement without the consent of the
related Securityholders, provided the related Rating Agencies confirm in writing
that such substitution or reduction will not result in the reduction,
qualification or withdrawal of the rating of such class of Securities or any
class of Securities of the related Series.
Reserve Account. If provided in the related Prospectus Supplement,
pursuant to the related Sale and Servicing Agreement, the Seller will establish
for a series or class of Securities an account, as specified in the related
Prospectus Supplement (the 'RESERVE ACCOUNT'), which will be maintained in the
name of the related Indenture Trustee. Unless otherwise provided in the related
Prospectus Supplement, the Reserve Account will be included in the property of
the related Trust. The Reserve Account will be funded by an initial deposit on
the Closing Date, and if the related Series has a Funding Period, will also be
funded on each Subsequent Transfer Date. The related Prospectus Supplement will
specify whether the Reserve Account will be funded solely from the proceeds of a
loan or loans to be made by a Cash Collateral Depositor pursuant to a loan
agreement (each a 'LOAN AGREEMENT'), from a deposit or deposits by the Seller,
or by a combination thereof. As described in the related Prospectus Supplement,
the amount on deposit in the Reserve Account will be increased on each Payment
Date up to the Specified Reserve Account Balance (as defined in the related
Prospectus Supplement) by the deposit therein of the amount of collections on
the related Receivables remaining on each such Payment Date
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after the payment of all other required payments and distributions on such date.
The related Prospectus Supplement will describe the circumstances and manner
under which distributions may be made out of the related Reserve Account, either
to holders of the Securities covered thereby, to the Seller or to a third-party
specified therein.
Cash Collateral Guaranty. If provided in the related Prospectus Supplement
with respect to a Trust classified as a grantor trust, the related Trustee will
have the right to demand payments under a Cash Collateral Guaranty under the
circumstances described therein. Each Cash Collateral Guaranty will be secured
by an account (each, a 'CASH COLLATERAL ACCOUNT'), which will be held in the
name of a cash collateral trustee (the 'CASH COLLATERAL TRUSTEE'), as specified
in the related Prospectus Supplement. The related Prospectus Supplement will
specify whether the Cash Collateral Account will be funded on the date of the
issuance of the related series of Securities from the proceeds of a loan to be
made by a Cash Collateral Depositor pursuant to a Loan Agreement, from a deposit
by the Seller or by a combination thereof. To the extent specified in the
related Prospectus Supplement, funds in the related Cash Collateral Account will
thereafter be supplemented by the deposit of amounts remaining on any
Distribution Date after making all other distributions required on such date.
Each Cash Collateral Guaranty will not be a recourse obligation of the related
Cash Collateral Depositor, any Cash Collateral Trustee, any related Trustee, the
Bank, as Seller or as Servicer, and will be secured solely with amounts, if any,
on deposit in the related Cash Collateral Account. Unless otherwise specified in
the related Prospectus Supplement, such Cash Collateral Account and any amounts
therein will not be the property of any Trust, but will be held in accordance
with the related Cash Collateral Trust Agreement as further described therein.
The related Prospectus Supplement will describe the circumstances and manner
under which distributions may be made out of any Cash Collateral Account, either
to the holders of the Securities covered thereby, to the Seller, to the Cash
Collateral Depositor or to a third party specified therein.
Yield Supplement Account; Yield Supplement Agreement. If so provided in
the related Prospectus Supplement, the Seller or a third party will enter into a
Yield Supplement Agreement and/or establish a Yield Supplement Account with the
related Indenture Trustee or related Trustee for the benefit of the holders of
the related Securities. A Yield Supplement Agreement or a Yield Supplement
Account will be designed to provide payments to the Securityholders in respect
of Receivables the Contract Rate of which is less than the Required Rate. A
Yield Supplement Account may be an asset of the obligor under the Yield
Supplement Agreement holding funds to secure the obligation of such obligor to
make payments under such Yield Supplement Agreement or, in the case of a Trust
that is not classified as a grantor trust, may be an asset of the Trust from
which cash may periodically be withdrawn to provide payments to the
Securityholders.
NET DEPOSITS
As an administrative convenience, the Seller, so long as it is Servicer and
is permitted to make deposits to the Collection Account on a monthly basis, will
be permitted to deposit the collections, aggregate Advances and Purchase Amounts
for any Trust for or with respect to the related Collection Period net of
distributions to be made to the Servicer or the Seller for such Trust with
respect to such Collection Period (remitting amounts to the Seller directly).
With respect to any Trust that issues both Certificates and Notes, if the
related Payment Dates do not coincide with Distribution Dates, all
distributions, deposits or other remittances made on a Payment Date will be
treated as having been distributed, deposited or remitted on the Distribution
Date for the applicable Collection Period for purposes of determining other
amounts required to be distributed, deposited or otherwise remitted on such
Distribution Date.
STATEMENTS TO TRUSTEES AND TRUST
Prior to each Distribution Date with respect to each series of Securities,
the Servicer will provide to the related Trustee and any Indenture Trustee a
statement setting forth substantially the same information for such date and the
related Collection Period as is required to be provided in the periodic reports
provided to Securityholders of such series described herein under 'Certain
Information Regarding the Securities--Reports to Securityholders.'
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EVIDENCE AS TO COMPLIANCE
Each Sale and Servicing Agreement or Pooling and Servicing Agreement, as
applicable, will provide that a firm of independent public accountants will
annually furnish to the related Trustee and any Indenture Trustee a statement as
to compliance by the Servicer during the preceding twelve months (or, in the
case of the first such certificate, from the applicable Closing Date) with
certain standards relating to the servicing of the applicable Receivables, or as
to the effectiveness of its processing and reporting procedures and certain
other matters.
Each Sale and Servicing Agreement or Pooling and Servicing Agreement, as
applicable, will also provide for delivery to the related firm of independent
public accountants referred to in the immediately preceding paragraph,
substantially simultaneously with the delivery or such accountants' statement
referred to above, of a certificate signed by an officer of the Servicer stating
that the Servicer has fulfilled its obligations in all material respects under
such Sale and Servicing Agreement or Pooling and Servicing Agreement, as
applicable, throughout the preceding twelve months (or, in the case of the first
such certificate, from the Closing Date) or, if there has been a default in the
fulfillment of any such obligation, describing each such default.
Copies of such statements and certificates may be obtained by
Securityholders by a request in writing addressed to the Servicer.
CERTAIN MATTERS REGARDING THE SERVICER
Each Sale and Servicing Agreement or Pooling and Servicing Agreement, as
applicable, will provide that the Servicer may not resign from its obligations
and duties as Servicer thereunder, except (i) upon determination that the
Servicer's performance of such duties is no longer permissible under applicable
law or (ii) in the event of the appointment of a successor servicer, upon
notification by each Rating Agency then rating any of the related Securities
that the rating then assigned to any such Securities will not be reduced or
withdrawn. Such resignation will not become effective until the related Trustee
(which shall not be obligated to act as successor servicer if the Servicer has
resigned for a reason other than that the performance of its duties are no
longer permissible under applicable laws), Indenture Trustee (if any) or a
successor servicer has assumed the Servicer's servicing responsibilities and
obligations under such Sale and Servicing Agreement or Pooling and Servicing
Agreement, as applicable.
Each Sale and Servicing Agreement or Pooling and Servicing Agreement, as
applicable, will also provide that, except in connection with a merger or
consolidation, neither the Seller nor the Servicer may transfer or assign all,
or a portion of, its rights, obligations and duties under any Sale and Servicing
Agreement or Pooling and Servicing Agreement, unless (i) (A) such transfer or
assignment will not result in a reduction or withdrawal by each Rating Agency
then rating any of the related Securities of the rating then assigned to any
such Securities and (B) the Indenture Trustee (if any) and the related Trustee
have consented to such transfer or assignment or (ii) the Indenture Trustee (if
any), the related Trustee and holders of Securities evidencing not less than 51%
of the voting interests thereof consent thereto. Any transfer of assignment with
respect to the Servicer of all of its rights, obligations and duties will not
become effective until a successor servicer has assumed the Servicer's rights,
obligations and duties under the related Sale and Servicing Agreement and
Pooling and Servicing Agreement, as applicable.
Each Sale and Servicing Agreement or Pooling and Servicing Agreement, as
applicable, will also provide that so long as the Bank (or its successor or
assign) or the Trustee is the Servicer, in the ordinary course of its business,
the Servicer will have the right to delegate any of its duties under the related
Sale and Servicing Agreement or Pooling and Servicing Agreement, as applicable,
to a third party. Any compensation payable to such third party will be paid by
the Servicer from its own funds, and none of the related Trust, Trustee (if not
the Servicer), Indenture Trustee (if any) or Securityholders will be liable for
such compensation. Notwithstanding any delegation of duties by the Servicer, the
Servicer will not be relieved of its liability and responsibility with respect
to such duties.
Each Sale and Servicing Agreement or Pooling and Servicing Agreement, as
applicable, will further provide that neither the Servicer nor any of its
directors, officers, employees, and agents shall be under any liability to the
related Trust, Trustee, Indenture Trustee (if any) or Securityholders for taking
any action or for refraining from taking any action pursuant to the related Sale
and Servicing Agreement or Pooling and Servicing Agreement, as applicable;
provided, however, that neither the Servicer nor any such person will be
protected against any liability that would otherwise be imposed by reason of
willful misfeasance, bad faith or gross negligence in the
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performance of duties or by reason of reckless disregard of obligations and
duties thereunder. Each Sale and Servicing Agreement or Pooling and Servicing
Agreement, as applicable, will further provide that the Servicer, and its
directors, officers, employees and agents are entitled to indemnification by the
related Trust for, and will be held harmless against, any loss, liability or
expense incurred in connection with any legal action relating to their
performance of servicing duties under the related Sale and Servicing Agreement
or Pooling and Servicing Agreement, as applicable, that is not otherwise
indemnified, other than (i) any loss or liability otherwise reimbursable
thereunder and (ii) any loss, liability, or expense incurred by reason of
willful misconduct, negligence or bad faith in performance of their duties
thereunder or by reason of their reckless disregard of obligations and duties
thereunder; provided, however, that such indemnification will be paid on a
Payment Date or Distribution Date only from amounts in excess of the amount
required to be maintained on deposit in the related enhancement account, or if
there is no such enhancement account, only after all payments or deposits
required under the related Sale and Servicing Agreement or Pooling and Servicing
Agreement, as applicable, for the benefit of Securityholders and the Servicer
have been made. In addition, each Sale and Servicing Agreement or Pooling and
Servicing Agreement, as applicable, will provide that the Servicer is under no
obligation to appear in, prosecute or defend any legal action that is not
incidental to the Servicer's servicing responsibilities under the related Sale
and Servicing Agreement or Pooling and Servicing Agreement, as applicable, and
that, in its opinion, may cause it to incur any expense or liability. The
Servicer may, however, undertake any reasonable action that it may deem
necessary or desirable in respect of such Sale and Servicing Agreement or
Pooling and Servicing Agreement, as applicable, and the rights and duties of the
parties thereto and the interests of the related Securityholders thereunder. In
such event, the legal expenses and costs of such action and any liability
resulting therefrom will be expenses, costs and liabilities of the related Trust
and the Servicer will be entitled to be reimbursed therefor out of the related
enhancement account; provided, however, that such reimbursement will be paid on
a Payment Date or Distribution Date only from amounts in excess of the amount
required to be maintained on deposit in the related enhancement account, or if
there is no such enhancement account, only after all payments required under the
related Sale and Servicing Agreement or Pooling and Servicing Agreement, as
applicable, for the benefit of Securityholders or the Servicer, have been made.
EVENTS OF SERVICING TERMINATION
Except as otherwise provided in the related Prospectus Supplement, 'EVENTS
OF SERVICING TERMINATION' under each Sale and Servicing Agreement or Pooling and
Servicing Agreement, as applicable, will consist of (i) any failure by the
Servicer to deliver to the related Trustee or any Indenture Trustee the
Servicer's certificate for the related Collection Period or any failure by the
Servicer to deliver to the related Trustee or any Indenture Trustee for deposit
in any Trust Account any proceeds or payments required to be delivered under the
terms of such Securities or the related Sale and Servicing Agreement or Pooling
and Servicing Agreement (or, in the case of a payment or deposit to be made not
later than the Deposit Date, the failure to make such payment or deposit on such
Deposit Date), which failure continues unremedied for five Business Days after
discovery by the Servicer or upon receipt of written notice to the Servicer by
the related Trustee or Indenture Trustee or to the related Trustee or Indenture
Trustee and the Servicer by holders of the related Notes evidencing not less
than 25% of the principal amount of such Notes then outstanding (or, if no Notes
are outstanding, Certificates of the related series evidencing not less than 25%
of the Certificate Balance then outstanding); (ii) any failure by the Servicer
to duly observe or perform in any material respect any other covenant or
agreement of the Servicer set forth in the related Sale and Servicing Agreement
or Pooling and Servicing Agreement or Indenture, which failure materially and
adversely affects the rights of the related Trust or the Securityholders (which
determination shall be made without regard to whether funds are available to the
Securityholders pursuant to any related enhancement) and which continues
unremedied for 60 days after the date of written notice of such failure to the
Servicer by the related Trustee or any Indenture Trustee or to the related
Trustee or any Indenture Trustee and the Servicer by holders of the related
Notes (so long as Notes are outstanding) evidencing not less than 25% of the
principal amount of such Notes then outstanding (or, if no Notes are
outstanding, Certificates of the related series evidencing not less than 25% of
the Certificate Balance then Outstanding); (iii) the entry of a decree or order
by a court or agency or supervisory authority having jurisdiction in the
premises for the appointment of a conservator, receiver or liquidator for the
Servicer in any insolvency, readjustment of debt, marshalling of assets and
liabilities, or similar proceedings, or for the winding up or liquidation of its
affairs, and the continuance of any such decree or order is unstayed and
effective for 60 consecutive days; or (iv) the consent by the Servicer to the
appointment of a conservator or receiver or liquidator in any insolvency,
readjustment of debt, marshalling of
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assets and liabilities, or similar proceedings of or relating to the Servicer or
of or relating to substantially all of its property, or the Servicer admits in
writing its inability to pay its debts generally as they become due, files a
petition to take advantage of any applicable insolvency or reorganization
statute, makes an assignment for the benefit of its creditors, or voluntarily
suspends payment of its obligations. The holders of Securities evidencing not
less than a majority of the principal amount of Notes then outstanding (or, if
no Notes are outstanding, Certificates of the related series evidencing not less
than a majority of the Certificate Balance then outstanding) may, with the
written consent of any provider of enhancement specified in the related
Prospectus Supplement, waive certain defaults by the Servicer in the performance
of its obligations.
RIGHTS UPON EVENT OF SERVICING TERMINATION
In the case of any Trust that has issued Notes, unless otherwise provided
in the related Prospectus Supplement, as long as an Event of Servicing
Termination under a Sale and Servicing Agreement remains unremedied, the related
Indenture Trustee or holders of Notes of the related series evidencing not less
than a majority of the principal amount of such Notes then outstanding (or, if
the Notes have been paid in full and the Indenture has been discharged in
accordance with its terms, by the related Trustee or holders of Certificates
evidencing not less than a majority of the Certificate Balance then outstanding)
may terminate all the rights and obligations of the Servicer under such Sale and
Servicing Agreement, whereupon such Indenture Trustee or a successor servicer
appointed by such Indenture Trustee will succeed to all the responsibilities,
duties and liabilities of the Servicer under such Sale and Servicing Agreement
and will be entitled to similar compensation arrangements. In the case of any
Trust that has not issued Notes, unless otherwise provided in the related
Prospectus Supplement, as long as an Event of Servicing Termination under the
related Sale and Servicing Agreement or Pooling and Servicing Agreement, as
applicable, remains unremedied, the related Trustee or holders of Certificates
of the related series evidencing not less than a majority of the Certificate
Balance then outstanding, by notice given in writing to the Servicer (and to the
related Trustee if given by Certificateholders), may terminate all the rights
and obligations of the Servicer under such Sale and Servicing Agreement or
Pooling and Servicing Agreement, whereupon such Trustee or a successor servicer
appointed by such Trustee will succeed to all the rights, duties and liabilities
of the Servicer under such Sale and Servicing Agreement or Pooling and Servicing
Agreement and will be entitled to similar compensation arrangements. In the
event that such Indenture Trustee or Trustee is unwilling or unable to so act,
it may appoint, or petition a court of competent jurisdiction for the
appointment of, a successor Servicer to act as successor to the outgoing
Servicer. Such Indenture Trustee or Trustee may make such arrangements for
compensation to be paid, which in no event may be greater than the Servicing Fee
paid to the Servicer under such Sale and Servicing Agreement or Pooling and
Servicing Agreement.
WAIVER OF PAST DEFAULTS
With respect to each Trust that has issued Notes, unless otherwise provided
in the related Prospectus Supplement, the holders of Notes evidencing at least a
majority in principal amount of the then outstanding Notes of the related series
(or, the holders of any Certificates of such series evidencing not less than a
majority of the Certificate Balance then outstanding, in the case of any Event
of Servicing Termination that does not adversely affect the related Indenture
Trustee or such Noteholders) may, on behalf of all such Noteholders and
Certificateholders, waive any default by the Servicer in the performance of its
obligations under the related Sale and Servicing Agreement and its consequences,
except an Event of Servicing Termination in making any required deposits to or
payments from any of the Trust Accounts in accordance with such Sale and
Servicing Agreement. Therefore, the Noteholders of a series have the ability, as
limited above, to waive defaults by the Servicer which could materially and
adversely affect the related Securityholders. With respect to each Trust that
has not issued Notes, holders of Certificates of such series evidencing not less
than a majority of the Certificate Balance then outstanding may, on behalf of
all such Certificateholders, with the consent of the provider of any
enhancement, waive any default by the Servicer in the performance of its
obligations under the related Sale and Servicing Agreement or Pooling and
Servicing Agreement, as applicable, except an Event of Servicing Termination in
making any required deposits to or payments from the related Trust Accounts in
accordance with such Sale and Servicing Agreement or Pooling and Servicing
Agreement, as applicable. No such waiver will impair such Securityholders'
rights with respect to subsequent defaults.
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AMENDMENT
Unless otherwise provided in the related Prospectus Supplement, each of the
Transfer and Servicing Agreements may be amended by the parties thereto, without
prior notice to the related Securityholders but with prior consent of the
related Trustee and prior notice to any related Rating Agencies (i) to cure any
ambiguity, to correct or supplement any provision therein or in the related
Securities which may be inconsistent with any other provision therein, to
evidence a succession to the Servicer or the Seller pursuant to the related
Transfer and Servicing Agreement, or add any other provisions with respect to
matters or questions arising under such Transfer and Servicing Agreement that
are not inconsistent with the provisions of such Transfer and Servicing
Agreement; provided, however, that such action will not, on the basis of an
officer's certificate and/or opinion of counsel reasonably acceptable to the
related Trustee and any Indenture Trustee, materially and adversely affect the
interests of the related Trust or any related Securityholders or (ii) to effect
a transfer or assignment of the Trust's or the Servicer's rights, obligations
and duties under such Transfer and Servicing Agreement. Unless otherwise
specified in the related Prospectus Supplement, the Transfer and Servicing
Agreements may also be amended by the Seller, the Servicer, the related Trustee
and any related Indenture Trustee with the consent of the holders of Notes
evidencing at least a majority in principal amount of then outstanding Notes, if
any, of the related series and the holders of the Certificates, if any, of the
related series evidencing at least a majority of the Certificate Balance then
outstanding for the purpose of adding any provisions to or changing in any
manner or eliminating any of the provisions of such Transfer and Servicing
Agreements or of modifying in any manner the rights of such Securityholders;
provided, however, that no such amendment may (i) increase or reduce in any
manner the amount of, or accelerate or delay the timing of, collections of
payments on the related Receivables or distributions that are required to be
made for the benefit of such Securityholders or (ii) reduce the aforesaid
percentage of the Notes or Certificates of such series which are required to
consent to any such amendment, without the consent of the holders of all the
outstanding Notes or Certificates, as the case may be, of such series.
PAYMENT OF NOTES
Upon the payment in full of all outstanding Notes of a given series and the
satisfaction and discharge of the related Indenture, the related Owner Trustee
will succeed to all the rights of the Indenture Trustee, and any
Certificateholders of such series, will succeed to all the rights of the
Noteholders of such series under the related Sale and Servicing Agreement,
except as otherwise provided therein.
TERMINATION
With respect to each Trust, the obligations of the Servicer, the Seller,
the related Trustee and any related Indenture Trustee, if any, pursuant to the
Transfer and Servicing Agreements will terminate upon the earlier of (i) the
Distribution Date or Payment Date next succeeding the month that is six months
after the maturity or other liquidation of the last related Receivable and the
disposition of any amounts received upon liquidation of any property remaining
in the related Trust and (ii) the payment to Securityholders of the related
series of all amounts required to be paid to them pursuant to the Transfer and
Servicing Agreements.
Unless otherwise provided in the related Prospectus Supplement, in order to
avoid excessive administrative expense, the Servicer will be permitted at its
option to purchase from each Trust, as of the last day of any applicable
Collection Period, if the then outstanding Pool Balance with respect to the
Receivables held by such Trust is 5% or less of the initial Pool Balance (as
defined in the related Prospectus Supplement, the 'ORIGINAL POOL BALANCE'), all
the remaining related Receivables at a price equal to the aggregate of the
Repurchase Amounts thereof as the end of such Collection Period.
As more fully described in the related Prospectus Supplement, any
outstanding Notes of the related series will be redeemed concurrently with the
purchase event specified above and the subsequent distribution to any related
Certificateholders of all amounts required to be distributed to them pursuant to
the applicable Trust Agreement or Pooling and Servicing Agreement will effect
early retirement of the Certificates of such series.
The related Trustee and any related Indenture Trustee will give written
notice of termination to each Securityholder of the related series of record,
which notice will specify the Distribution Date and/or Payment Date upon which
such Securityholders may surrender their Securities to the related Trustee or
the Transfer Agent and Registrar, as the case may be, for final payment. The
final distribution to any Securityholder will be made only upon surrender and
cancellation of such holder's Security (whether a Definitive Security or the
Securities
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registered in the name of Cede representing the Securities) at the office or
agency of the related Trustee or the Transfer Agent and Registrar, as the case
may be, specified in the notice of termination.
With respect to any Trust issuing Notes, subject to applicable law and
after the Indenture Trustee has taken certain measures to notify Noteholders,
any money held by the Indenture Trustee or any Paying Agent in trust for payment
on the Notes which remain unclaimed for two years shall, upon request of such
Trust, be paid to such Trust. Following any such payment, the Trustee and any
Paying Agent shall no longer be liable to any Noteholder with respect to such
unclaimed amount, and any claim with respect to such amount shall be an
unsecured claim against such Trust. If, within 18 months after the first notice
of final payment on any Certificates, there remain Certificates which have not
been surrendered for cancellation, the related Trustee may take appropriate
steps to notify the applicable Certificateholders (the cost thereof paid out of
the unclaimed amounts). Subject to applicable law, any funds that then remain
shall be paid to the Seller.
Any amounts remaining in a Trust not issuing Notes, after the related
Trustee has taken certain measures to locate a Certificateholder and such
measures have failed, will, under certain circumstances, be distributed to the
United Way or a similar charitable organization located or operating in the New
York metropolitan area as specified by the Servicer; provided, however, that
such funds will, under certain circumstances, be distributed by the Paying Agent
to the United Way no later than three years after the final Distribution Date
specified in such Trustee's written notice of termination to the
Certificateholders.
ADMINISTRATION AGREEMENT
With respect to any Trust that issues Notes, Chase, in its capacity as
administrator (the 'ADMINISTRATOR'), will enter into an agreement (as amended
and supplemented from time to time, the 'ADMINISTRATION AGREEMENT') with each
Trust and the related Indenture Trustee pursuant to which the Administrator will
agree, to the extent provided in such Administration Agreement, to provide the
notices and to perform on behalf of the related Trust certain other
administrative obligations required by the related Indenture. As compensation
for the performance of the Administrator's obligations under the Administration
Agreement and as reimbursement for its expenses related thereto, the
Administrator will be entitled to a monthly administration fee in an amount to
be set forth in the related Prospectus Supplement (the 'ADMINISTRATION FEE'). To
the extent and on the terms set forth in the related Administration Agreement
and described in the related Prospectus Supplement, the Administrator may act
directly or through its agents and attorneys.
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CERTAIN LEGAL ASPECTS OF THE RECEIVABLES
GENERAL
The Receivables are 'chattel paper' as defined in the Uniform Commercial
Code in effect in the State of New York (the 'UCC'). Pursuant to the UCC, the
sale of chattel paper is treated in a manner similar to a security interest in
chattel paper. In order to protect each Trust's ownership or security interest
in its Receivables, the Seller will file UCC-1 financing statements with the
appropriate governmental authorities in the State of Delaware to give notice of
such Trust's and any related Indenture Trustee's ownership of and security
interest in the Receivables and their proceeds. Under each Sale and Servicing
Agreement and Pooling and Servicing Agreement, the Seller will be obligated to
maintain the perfection of each Trust's and any related Indenture Trustee's
interest in the Receivables. It should be noted, however, that a purchaser of
chattel paper who gives new value and takes possession of it in the ordinary
course of such purchaser's business has priority over a security interest,
including an ownership interest, in the chattel paper that is perfected by
filing UCC-1 financing statements, and not by possession of such chattel paper
by the original secured party, if such purchaser acts in good faith without
knowledge that the related chattel paper is subject to a security interest,
including an ownership interest. Any such purchaser would not be deemed to have
such knowledge because there are UCC filings and would not learn of the sale of
or security interest in the Receivables from a review of the Receivables since
they would not be marked to show such sale, although Chase Auto Finance's master
computer records will indicate such sale.
SECURITY INTERESTS IN THE FINANCED VEHICLES
Security interests in vehicles registered in most states may be perfected
by a notation of the secured party's lien on, or possession of, the certificate
of title for such vehicle, depending on state law. Since around December 1994
and April 1997, respectively, Chase Auto Finance has participated in
California's and Virginia's electronic titles programs. Since such times
California and Virginia liens have been noted electronically rather than on
paper certificates. Chase Auto Finance's practice is to obtain a representation
and warranty from each Dealer or the related Obligor (in the case of Receivables
originated without involvement of Dealers) to the effect that the Originating
Bank has been designated as the sole lien holder on the certificate of title. In
the event the Dealer or related Obligor fails, due to clerical errors or for any
other reason, to effect such notation of the Originating Bank's interest in a
Financed Vehicle, the Originating Bank would not have a perfected first priority
security interest in such Financed Vehicle. In this event the only recourse of
the Originating Bank, the Seller or the Servicer vis-a-vis third parties would
be against the Obligor on an unsecured basis or against a Dealer.
Pursuant to the terms of each Sale and Servicing Agreement or Pooling and
Servicing Agreement, as applicable, the Seller will assign its security interest
in the individual Financed Vehicles to each Trust, and if applicable, such Trust
will assign each such security interest to the related Indenture Trustee.
However, because of the administrative burden and expense, neither the Seller
nor the related Trustee will amend the certificates of title to identify the
related Trust or any related Indenture Trustee as the new secured party and,
accordingly, the Originating Bank will continue to be named as the secured party
on the certificates of title relating to the Financed Vehicles. In a majority of
states, assignment of a Receivable together with the related security interest
is an effective conveyance of such security interest without amendment of any
lien noted on the related certificates of title and the new secured party
succeeds to the Originating Bank's rights as the secured party as against
creditors of the Obligor. In certain states, in the absence of such amendment
and delivery, the Seller, the related Trust and/or any related Indenture Trustee
may not have a perfected security interest in the Financed Vehicle. In such
event or in the event that the Trust does not have a perfected first priority
security interest in the Financed Vehicle, the only recourse of such Trust
vis-a-vis third parties would be against an Obligor on an unsecured basis or (if
the Originating Bank did not have a perfected security interest in such Financed
Vehicle) against the Seller pursuant to its repurchase obligation. See
'--Repurchase Obligation' herein.
Except as described above, in the absence of fraud or forgery by a vehicle
owner or administrative error by state recording officials, the notation of the
lien of the Originating Bank on the certificate of title will be sufficient to
protect each Trust against the rights of subsequent purchasers of a Financed
Vehicle or subsequent lenders who take a security interest in the Financed
Vehicle. If there are any Financed Vehicles as to which the Originating Bank has
failed to perfect the security interest assigned to a Trust (i) such security
interest would be
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subordinate to, among others, holders of perfected security interests and (ii)
subsequent purchasers of such Financed Vehicles would take possession free and
clear of such security interest. There also exists a risk in not identifying
each Trust or any related Indenture Trustee as the new secured party on the
certificate of title that, through fraud or negligence, the security interest of
such Trust or Indenture Trustee could be released.
In the event that the owner of a Financed Vehicle moves to a state other
than the state in which such Financed Vehicle initially is registered, under the
laws of most states the perfected security interest in the Financed Vehicle will
continue for four months after such relocation and thereafter until the owner
re-registers the Financed Vehicle in such state. A majority of states generally
require surrender of a certificate of title to re-register a vehicle.
Accordingly, Chase Auto Finance must surrender possession if it holds the
certificate of title to such Financed Vehicle or, in the case of Financed
Vehicles originally registered in a state which provides for notation of lien
but not possession of the certificate of title by the holder of the security
interest in the related motor vehicle, Chase Auto Finance would receive notice
of surrender if the security interest in the Financed Vehicle is noted on the
certificate of title. Accordingly, Chase Auto Finance would have the opportunity
to re-perfect the security interest in the Financed Vehicle in the state of
relocation. In states that do not require a certificate of title for
registration of a motor vehicle, re-registration could defeat perfection. In the
ordinary course of servicing its portfolio of Motor Vehicle Loans, Chase Auto
Finance takes steps to effect such re-perfection upon receipt of notice of
re-registration or information from the Obligor as to relocation. Similarly,
when an Obligor under a Receivable sells a Financed Vehicle, Chase Auto Finance
must surrender possession of the certificate of title or will receive notice as
a result of its lien noted thereon and accordingly will have an opportunity to
require satisfaction of the related Receivable before release of the lien. Under
each Sale and Servicing Agreement and Pooling and Servicing Agreement, the
Servicer is obligated to take such steps, at the Servicer's expense, as are
necessary to maintain perfection of security interests in the Financed Vehicles.
Under the laws of many states, certain possessory liens for repairs
performed on a motor vehicle and storage, as well as certain rights in favor of
Federal and state governmental authorities arising from the use of a motor
vehicle in connection with illegal activities, may take priority even over a
perfected security interest. Certain U.S. federal tax liens may have priority
over the lien of a secured party. The Seller will represent in each Sale and
Servicing Agreement and Pooling and Servicing Agreement that it has no knowledge
of any such liens with respect to any Financed Vehicle. However, such liens
could arise at any time during the term of a Receivable. No notice will be given
to the Trustee in the event such a lien arises.
ENFORCEMENT OF SECURITY INTERESTS IN VEHICLES
The Servicer on behalf of each Trust and any Indenture Trustee may take
action to enforce its security interest by repossession and resale of the
Financed Vehicles securing the Receivables. The actual repossession may be
contracted out to third party contractors. Under the UCC and laws applicable in
most states, a creditor can repossess a motor vehicle securing a loan by
voluntary surrender, 'self-help' repossession that is 'peaceful' (i.e., without
breach of the peace) and, in the absence of voluntary surrender and the ability
to repossess without breach of the peace, by judicial process. The UCC and
consumer protection laws in most states place restrictions on repossession
sales, including requiring prior notice to the debtor and commercial
reasonableness in effecting such a sale. In the event of such repossession and
resale of a Financed Vehicle, the Trust would be entitled to be paid out of the
sale proceeds before such proceeds could be applied to the payment of the claims
of unsecured creditors or the holders of subsequently perfected security
interests or, thereafter, to the debtor.
Under the UCC and laws applicable in most states, a creditor is entitled to
obtain a deficiency judgment from a debtor for any deficiency on repossession
and resale of the motor vehicle securing such debtor's loan. However, some
states impose prohibitions or limitations on deficiency judgments. In general, a
defaulting Obligor may not have sufficient assets to make the pursuit of a
deficiency worthwhile.
Certain other statutory provisions, including federal and state bankruptcy
and insolvency laws, and general equitable principles may limit or delay the
ability of a lender to repossess and resell collateral or enforce a deficiency
judgment.
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OTHER MATTERS
The Seller intends that each transfer of Receivables by it to a Trust under
a Sale and Servicing Agreement or a Pooling and Servicing Agreement constitutes
a sale. In the event that the Seller were to become insolvent, the FDIA, as
amended by FIRREA, sets forth certain powers that the FDIC may exercise if it
were appointed receiver of the Seller. To the extent that the Seller has granted
a security interest in the Receivables to a Trust and that interest was validly
perfected before the Seller's insolvency and was not taken in contemplation of
insolvency or with the intent to hinder, delay or defraud the Seller or its
creditors, that security interest would not be subject to avoidance by the FDIC
as receiver of the Seller. Positions taken by the FDIC staff prior to the
passage of FIRREA do not suggest that the FDIC, if appointed receiver of the
Seller, would interfere with the timely transfer to such Trust of payments
collected on the related Receivables. If, however, the FDIC were to assert a
contrary position, or were to require the Trustee to establish its rights to
those payments by submitting to and completing the administrative claims
procedure established under the FDIA, or the conservator or receiver were to
request a stay of proceedings with respect to the Seller as provided under the
FDIA, delays in payments on the related Securities and possible reductions in
the amount of those payments could occur.
Numerous federal and state consumer protection laws may impose requirements
applicable to the origination and lending pursuant to the contracts, including
the Truth in Lending Act, the Fair Credit Reporting Act, the Equal Credit
Opportunity Act, the Magnuson-Moss Warranty Act and the Federal Trade Commission
Act.
The so-called 'Holder-in-Due-Course' Rule of the Federal Trade Commission
(the 'FTC RULE'), other state statutes or the common law in certain states have
the effect of subjecting a seller (and certain related lenders and their
assignees) in a consumer credit transaction and any assignee of the seller
(which would include each Trust) to all claims and defenses that the obligor in
the transaction could assert against the seller of the goods. Liability of a
subsequent holder under the FTC Rule is limited to the amounts paid by the
obligor under the contract, and a subsequent holder of the contract may also be
unable to collect any balance remaining due thereunder from the obligor. The
Uniform Consumer Credit Code applicable in certain states contains provisions
which generally duplicate this rule.
Each Sale and Servicing Agreement and Pooling and Servicing Agreement will
set forth criteria that must be satisfied by each Receivable, and such criteria
will provide, among other things, that each Receivable complies with all
requirements of law in all material respects. Accordingly, if an Obligor has a
claim against a Trust for violation of any law and such claim materially and
adversely affects the related Securityholders' interest in a Receivable, such
violation would result in the failure to satisfy a criterion in the related Sale
and Servicing Agreement or Pooling and Servicing Agreement and would create an
obligation of the Seller to repurchase the Receivable unless such failure is
cured.
REPURCHASE OBLIGATION
Under each Sale and Servicing Agreement and Pooling and Servicing
Agreement, each Receivable must satisfy certain criteria, and such criteria
relate to, among other things, the validity, subsistence, perfection, and
priority of the security interest of the Originating Bank in each Financed
Vehicle. Accordingly, if any defect exists in the perfection of the security
interest of the Originating Bank in any Financed Vehicle and such defect
materially and adversely affects the related Securityholders' interest in the
related Receivable, such defect would result in the failure to satisfy a
criterion in the related Sale and Servicing Agreement or Pooling and Servicing
Agreement and would create an obligation of the Seller to repurchase such
Receivable unless such failed criterion is cured.
ERISA CONSIDERATIONS
The Employee Retirement Income Security Act of 1974, as amended ('ERISA'),
and Section 4975 of the Internal Revenue Code of 1986, as amended (the 'CODE'),
impose certain requirements on employee benefit plans and certain other plans
and arrangements, including individual retirement accounts and annuities, Keogh
plans and certain collective investment funds or insurance company general or
separate accounts in which such plans, accounts or arrangements are invested,
that are subject to the fiduciary responsibility provisions of ERISA and/or
Section 4975 of the Code (collectively, 'PLANS'), and on persons who are
fiduciaries with respect to Plans, in connection with the investment of 'plan
assets' of any Plan ('PLAN ASSETS'). ERISA generally
53
<PAGE>
imposes on Plan fiduciaries certain general fiduciary requirements, including
those of investment prudence and diversification and the requirement that a
Plan's investments be made in accordance with the documents governing the Plan.
Generally, any person who has discretionary authority or control respecting the
management or disposition of Plan Assets, and any person who provides investment
advice with respect to Plan Assets for a fee, is a fiduciary with respect to
such Plan Assets.
ERISA and Section 4975 of the Code prohibit a broad range of transactions
involving Plan Assets and persons ('PARTIES IN INTEREST' under ERISA and
'DISQUALIFIED PERSONS' under the Code) who have certain specified relationships
to a Plan or its Plan Assets, unless a statutory or administrative exemption is
available. Parties in Interest or Disqualified Persons that participate in a
prohibited transaction may be subject to a penalty imposed under ERISA and/or an
excise tax imposed pursuant to Section 4975 of the Code, unless a statutory or
administrative exemption is available. These prohibited transactions generally
are set forth in Section 406 of ERISA and Section 4975 of the Code.
Any fiduciary or other Plan investor considering whether to purchase any
Securities on behalf of or with Plan Assets of any Plan should consult with its
counsel and refer to the related Prospectus Supplement for guidance regarding
the ERISA Considerations applicable to the Securities offered thereby.
Certain employee benefit plans, such as governmental plans (as defined in
Section 3(32) of ERISA) and certain church plans (as defined in Section 3(33) of
ERISA), are not subject to the requirements of ERISA or Section 4975 of the
Code. Accordingly, assets of such plans may be invested in the Securities of any
series without regard to the ERISA considerations described herein, subject to
the provisions of other applicable federal and state law. However, any such plan
that is qualified and exempt from taxation under Sections 401(a) and 501(a) of
the Code is subject to the prohibited transaction rules set forth in Section 503
of the Code.
PLAN OF DISTRIBUTION
The Securities of each series may be sold to or through underwriters (the
'UNDERWRITERS') by a negotiated firm commitment underwriting and public
reoffering by the Underwriters or such other underwriting arrangement as may be
specified in the related Prospectus Supplement or may be placed either directly
or through agents. The Seller intends that the Securities will be offered
through such various methods from time to time and that offerings may be made
concurrently through more than one of such methods or that an offering of a
particular series of Securities may be made through a combination of such
methods.
Each Prospectus Supplement will either (i) set forth the price at which
each class of Securities being offered thereby will be offered to the public and
any concessions that may be offered to certain dealers participating in the
offering of such Securities, or (ii) specify that the related Securities are to
be resold by the Underwriters in negotiated transactions at varying prices to be
determined at the time of such sale. After the initial public offering of any
such Securities, such public offering prices and such concessions may be
changed.
Each Underwriting Agreement (as defined in the related Prospectus
Supplement) will provide that the Seller will indemnify the Underwriters against
certain civil liabilities, including liabilities under the Securities Act, or
contribute to payments the several Underwriters may be required to make in
respect thereof.
Each Trust may, from time to time, invest funds in its Trust Accounts in
Eligible Investments acquired from such Underwriters or from the Seller or any
of its Affiliates.
Underwriters may engage in over-allotment transactions, stabilizing
transactions, syndicate covering transactions and penalty bids with respect to
the Securities in accordance with Regulation M under the Exchange Act.
Over-allotment transactions involve syndicate sales in excess of the offering
size, which creates a syndicate short position. Stabilizing transactions permit
bids to purchase the Security so long as the stabilizing bids do not exceed a
specified maximum. Syndicate covering transactions involve purchases of the
Securities in the open market after the distribution has been completed in order
to cover syndicate short positions. Penalty bids permit such Underwriters to
reclaim a selling concession from a syndicate member when the Securities
originally sold by such syndicate member are purchased in a syndicate covering
transaction. Such over-allotment transactions, stabilizing transactions,
syndicate covering transactions and penalty bids may cause the prices of the
Securities to be higher than they would otherwise be in the absence of such
transactions. Neither the Issuer nor any of the
54
<PAGE>
Underwriters represent that they will engage in any such transactions or that
such transactions, once commenced, will not be discontinued without notice.
Pursuant to each of the Underwriting Agreements with respect to a given
series of Securities, the closing of the sale of any class of Securities subject
to such Underwriting Agreement will be conditioned on the closing of the sale of
all other such classes of Securities of that series.
The place and time of delivery for the Securities of any series in respect
of which this Prospectus is delivered will be set forth in the related
Prospectus Supplement.
RATINGS
Each Class of Securities of a series offered pursuant to this Prospectus
and a related Prospectus Supplement will be rated at its initial issuance in one
of the four highest categories by at least one nationally recognized statistical
rating organization (each, a 'RATING AGENCY').
A securities rating addresses the likelihood of the receipt by the
Securityholders of scheduled interest and principal payments. The rating takes
into consideration the characteristics of the Receivables and the structural,
legal and tax aspects associated with the Securities. The ratings on the
Securities do not, however, constitute statements regarding the likelihood or
frequency of prepayments on the Receivables or the possibility that the
Securityholders might realize a lower than anticipated yield or that if there is
a rapid rate of principal payments, including prepayments, on the Receivables,
investors in Strip Notes or Strip Certificates could fail to recover their
initial investments.
A security rating is not a recommendation to buy, sell or hold Securities
and may be subject to revision or withdrawal at any time by the assigning Rating
Agency. No person is obligated to maintain the rating on any Security, and,
accordingly, there can be no assurance that the ratings assigned to a Security
upon initial issuance will not be lowered or withdrawn by a Rating Agency at any
time thereafter.
LEGAL MATTERS
Certain legal matters relating to the issuance of the Securities of any
series will be passed upon for the Seller by Simpson Thacher & Bartlett (a
partnership which includes professional corporations), New York, New York, and
such other counsel specified in the related Prospectus Supplement. Certain legal
matters will be passed upon for the Underwriters by Orrick, Herrington &
Sutcliffe LLP, New York, New York. From time to time Simpson Thacher & Bartlett
and Orrick, Herrington & Sutcliffe LLP may provide legal services to the Seller
and its affiliates.
55
<PAGE>
INDEX OF TERMS
[TO BE REVISED]
<TABLE>
<CAPTION>
TERM PAGE
- - - --------------------------------------------- ------
<S> <C>
Actuarial Receivables........................ 18
Administration Agreement..................... 49
Administration Fee........................... 49
Administrator................................ 49
Advance...................................... 42
Applicable Trustee........................... 34
Assignments.................................. 20
Bank......................................... 6
Base Rate.................................... 31
Book-Entry Securities........................ 7
Business Day................................. 41
Calculation Agent............................ 32
Cash Collateral Account...................... 44
Cash Collateral Depositor.................... 10
Cash Collateral Guaranty..................... 10
Cash Collateral Trustee...................... 44
Cede......................................... 2
Cedel........................................ 34
Cedel Participants........................... 34
Certificate Balance.......................... 8
Certificate Distribution Account............. 40
Certificate Pool Factor...................... 24
Certificateholders........................... 34
Certificates................................. 1
Chase........................................ 6
Chase Auto Finance........................... 6,17
Chase Auto Finance Portfolio................. 19
Chase Connecticut Bank....................... 19
Chase Connecticut Loans...................... 19
Chase Florida Bank........................... 19
Chase Florida Loans.......................... 19
Chase Lincoln Bank........................... 19
Chase Lincoln Loans.......................... 19
Chase Maryland Loans......................... 19
Chase N.A.................................... 6
Chase USA.................................... 1
Closing Date................................. 38
Code......................................... 52
Collection Account........................... 39
Collection Period............................ 42
Commission................................... 2
Commodity Indexed Securities................. 32
Contract Rate................................ 17
Cooperative.................................. 35
Corporation.................................. 6
Currency Indexed Securities.................. 32
Cutoff Date.................................. 16
Dealer Agreements............................ 20
Dealers...................................... 20
</TABLE>
56
<PAGE>
<TABLE>
<CAPTION>
TERM PAGE
- - - --------------------------------------------- ------
<S> <C>
Defaulted Receivable......................... 41
Definitive Certificates...................... 35
Definitive Notes............................. 35
Definitive Securities........................ 35
Deposit Date................................. 41
Depositaries................................. 33
Depository................................... 25
Direct Receivables........................... 19
Disqualified Persons......................... 53
Distribution Date............................ 30
DSCs......................................... 20
DTC.......................................... 2
Due Date..................................... 17
Eligible Deposit Account..................... 40
ERISA........................................ 52
Euroclear.................................... 34
Euroclear Operator........................... 35
Euroclear Participants....................... 34
Events of Default............................ 27
Events of Servicing Termination.............. 46
Exchange Act................................. 2
Face Amount.................................. 32
FDIA......................................... 13
FDIC......................................... 1
Federal Tax Counsel.......................... 11
Final Payment Receivables.................... 18
Final Scheduled Maturity Date................
Financed Vehicles............................ 9
FIRREA....................................... 13
Fixed Rate Securities........................ 31
Floating Rate Securities..................... 31
FTC Rule..................................... 52
Funding Period............................... 1,9
Holders...................................... 7
Indenture.................................... 7
Indenture Trustee............................ 6
Index........................................ 32
Indexed Commodity............................ 32
Indexed Currency............................. 32
Indexed Principal Amount..................... 32
Indexed Securities........................... 32
Indirect Participants........................ 7
Initial Receivables.......................... 9
Interest Rate................................ 7
Interest Reset Period........................ 31
Investment Earnings.......................... 41
Issuer....................................... 6
Late Fees.................................... 42
LIBOR........................................ 31
Loan Agreement............................... 44
Merger....................................... 6
Motor Vehicle Loans.......................... 16
</TABLE>
57
<PAGE>
<TABLE>
<CAPTION>
TERM PAGE
- - - --------------------------------------------- ------
<S> <C>
Note Distribution Account.................... 39
Note Pool Factor............................. 24
Noteholders.................................. 34
Notes........................................ 1
Obligors..................................... 16
Original Pool Balance........................ 49
Originating Bank............................. 17
Owner Trustee................................ 6
Paid-Ahead................................... 41
Paid-Ahead Account........................... 40
Paid-Ahead Period............................ 24
Paid-Ahead Precomputed Receivable............ 24
Paid-Ahead Simple Interest Receivable........ 24
Participants................................. 7
Parties in Interest.......................... 53
Pass Through Rate............................ 8
Paid-Ahead Period............................
Paid-Ahead Actuarial Receivable..............
Paid-Ahead Simple Interest Receivable........
Paying Agent................................. 41
Payment Date................................. 25
Percentage Interest.......................... 6
Permitted Investments........................ 40
Plan Assets.................................. 52
Plans........................................ 52
Pool Balance................................. 24
Pooling and Servicing Agreement.............. 6
Portfolio Experience......................... 19
Pre-Funding Account.......................... 1
Pre-Funding Amount........................... 9
Prospectus Supplement........................ 1
Qualified Institution........................ 40
Qualified Trust Institution.................. 40
Rating Agency................................ 54
Receivables.................................. 16
Receivables Pool............................. 16
Registration Statement....................... 2
Related Documents............................ 29
Repurchase Amount............................ 39
Required Rate................................ 11
Reserve Account.............................. 43
Rules........................................ 34
Sale and Servicing Agreement................. 9
Schedule of Receivables...................... 38
Securities................................... 1
Securities Act............................... 2
Securityholder............................... 34
Securityholders.............................. 7
Seller....................................... 1,6
</TABLE>
58
<PAGE>
<TABLE>
<CAPTION>
TERM PAGE
- - - --------------------------------------------- ------
<S> <C>
Senior Securities............................ 14
Servicer..................................... 1,6
Servicing Fee................................ 42
Servicing Fee Rate........................... 42
Simple Interest Receivables.................. 17
Spread....................................... 31
Spread Multiplier............................ 31
Stock Index.................................. 32
Stock Indexed Securities..................... 32
Strip Certificates........................... 8
Strip Notes.................................. 7
Subordinated Securities...................... 14
Subsequent Receivables....................... 9
Subsequent Transfer Date..................... 38
Terms and Conditions......................... 35
Transfer Agent and Registrar................. 36
Transfer and Servicing Agreements............ 38
Trust........................................ 1
Trust Accounts............................... 40
Trust Agreement.............................. 6
Trustee...................................... 6
UCC.......................................... 50
Underwriters................................. 53
Yield Supplement Account..................... 11
Yield Supplement Agreement................... 11
</TABLE>
59
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
Estimated expenses in connection with the offering of the Securities being
registered hereunder (other than underwriting discounts and commissions) are
estimated as follow:*
<TABLE>
<S> <C>
Registration Fee.............................................. $1,515,152
Legal Fees and Expenses....................................... 500,000
Accounting Fees and Expenses.................................. 120,000
Blue Sky Fees and Expenses.................................... 30,000
Rating Agency Fees............................................ 510,000
Trustee's Fees and Expenses................................... 50,000
Printing...................................................... 20,000
Miscellaneous................................................. 54,848
----------
Total......................................................... $2,800,000
----------
----------
</TABLE>
- - - ------------------
* Reflects expenses related to this Registration Statement and expenses related
to Registration Statement No. 333-7575 whose unissued Securities are carried
forward.
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
In addition to the indemnification provisions set forth below, directors
and officers liability insurance policies presently exist that insure directors
and officers of Chase Manhattan Bank USA, National Association, a national
banking association having its principal executive offices in Wilmington,
Delaware ('CHASE USA'), its parent and certain of its subsidiaries. The policies
cover losses for which Chase USA, its parent and certain of its subsidiaries
shall be required or permitted by law to indemnify directors and officers and
which result from claims made against such directors or officers based upon the
commission of wrongful acts in the performance of their duties. The policies
also cover losses that the directors or officers must pay as the result of
claims brought against them based upon the commission of wrongful acts in the
performance of their duties and for which they are not indemnified by Chase USA,
its parent or any of its subsidiaries. The losses covered by the policies are
subject to certain exclusions and do not include fines or penalties imposed by
law or other matters deemed uninsurable under the law. The policies contain
self-insured retention provisions.
CHASE USA: Article TENTH of the Articles of Association of Chase USA
provide that any person who was or is made a party or is threatened to be made a
party to or is otherwise involved in any action, suit or proceeding, whether
civil, criminal, administrative or investigative (a 'proceeding'), by reason of
the fact that he or she is or was a director or officer of Chase USA or is or
was serving at the request of Chase USA as a director, officer, employee or
agent of another corporation or of a partnership, joint venture, trust or other
enterprise, including service with respect to an employee benefit plan (an
'indemnitee'), whether the basis of such proceeding is alleged action in an
official capacity as a director, officer, employee or agent or in any other
capacity while serving as a director, officer, employee or agent, shall be
indemnified and held harmless by Chase USA to the fullest extent authorized by
the Delaware General Corporation Law, as the same exists or may hereafter be
amended (but, in the case of any such amendment, only to the extent that such
amendment permits Chase USA to provide broader indemnification rights than
permitted prior thereto), against all expense, liability and loss (including
attorneys' fees, judgments, fines, ERISA excise taxes or penalties and amounts
paid in settlement) reasonably incurred or suffered by such indemnitee in
connection therewith and such indemnification shall continue as to an indemnitee
who has ceased to be a director, officer, employee or agent and shall inure to
the benefit of the indemnitee's heirs, executors and administrators; provided,
however, that, except as provided in the second following paragraph with respect
to proceedings to enforce rights to indemnification, Chase USA shall indemnify
any such indemnitee in connection with a proceeding (or part thereof) initiated
by such indemnitee only if such proceeding (or part thereof) was authorized by
the board of directors of Chase USA.
II-1
<PAGE>
The rights to indemnification described in the immediately preceding
paragraph shall include the right to be paid by Chase USA the expenses incurred
in defending any proceeding for which such right to indemnification is
applicable in advance of its final disposition (hereinafter an 'ADVANCEMENT OF
EXPENSES'); provided, however, that, if the Delaware General Corporation Law
requires, an advancement of expenses incurred by an indemnitee in his or her
capacity as a director or officer (and not in any other capacity in which
service was or is rendered by such indemnitee, including, without limitation,
service to an employee benefit plan) shall be made only upon delivery to Chase
USA of an undertaking (hereinafter an 'undertaking'), by or on behalf of such
indemnitee, to repay all amounts so advanced if it shall ultimately be
determined by final judicial decision from which there is no further right to
appeal (hereinafter a 'FINAL ADJUDICATION') that such indemnitee is not entitled
to be indemnified for such expenses under such Article TENTH or otherwise.
The rights to indemnification and to the advancement of expenses described
in the two preceding paragraphs are contract rights. If a claim under either of
such paragraphs is not paid in full by Chase USA within sixty days after a
written claim has been received by Chase USA (except in the case of a claim for
an advancement of expenses, in which case the applicable period shall be twenty
days), the indemnitee may at any time thereafter bring suit against Chase USA to
recover the unpaid amount of the claim. If successful in whole or in part in any
such suit, or in a suit brought by Chase USA to recover an advancement of
expenses pursuant to the terms of an undertaking, the indemnitee shall be
entitled to be paid also the expense of prosecuting or defending such suit. In
any suit brought by the indemnitee to enforce a right to indemnification under
such Article TENTH (but not in a suit brought by the indemnitee to enforce a
right to an advancement of expenses) it shall be a defense that, and in any suit
by Chase USA to recover an advancement of expenses pursuant to the terms of an
undertaking, Chase USA shall be entitled to recover such expense upon a final
adjudication that, the indemnitee has not met any applicable standard for
indemnification set forth in the Delaware General Corporation Law. Neither the
failure of Chase USA (including its board of directors, independent legal
counsel, or its stockholders) to have made a determination prior to the
commencement of such suit that indemnification of the indemnitee is proper in
the circumstances because the indemnitee has met the applicable standard of
conduct set forth in the Delaware General Corporation Law, nor an actual
determination by Chase USA (including its board of directors, independent legal
counsel, or its stockholders) that the indemnitee has not met such applicable
standard of conduct, shall create a presumption that the indemnitee has not met
such applicable standard of conduct or, in the case of such a suit brought by
the indemnitee, be a defense to such suit. In any suit brought by the indemnitee
to enforce a right to indemnification or to an advancement of expenses under
such Article TENTH, or by Chase USA to recover an advancement of expenses
pursuant to the terms of an undertaking, the burden of proving that the
indemnitee is not entitled to be indemnified, or to such advancement of
expenses, under such Article TENTH or otherwise shall be on Chase USA.
Article TENTH of Chase USA's Articles of Association also provides that the
foregoing right of indemnification or reimbursement shall not be exclusive of
other rights to which any person may be entitled under any statute, Articles of
Association, by-law, agreement, or vote of stockholders or disinterested
stockholders or otherwise. Section 145 of the Delaware General Corporation Law
provides that a Delaware corporation must indemnify a director or officer who
has defended successfully, on the merits or otherwise, any proceeding against
him or any claim, matter or issue therein, for reasonable expenses actually
incurred in such defense.
Article 7 of the Business Corporation Law of the State of New York,
Sections 721 through 726, provides, under certain circumstances, for
indemnification of directors and officers of a corporation who are made or
threatened to be made, a party to an action or proceeding (other than one by or
in the right of a corporation to procure a judgment in its favor), whether civil
or criminal, by reason of their service as an officer or director of a
corporation against judgments, fines, amounts paid in settlement and reasonable
expenses, including attorneys' fees actually and necessarily incurred as a
result of such action or proceeding or any appeal therein. Article 7 of the New
York Business Corporation Law also provides that the statutory indemnification
provisions are nonexclusive, but prohibits indemnification if a judgment or
other final adjudication adverse to the director or officer of a corporation
establishes that the officer's or director's acts were committed in bad faith or
were the result of active and deliberate dishonesty and were material to the
cause of action so adjudicated, or that such director or officer personally
gained in fact a financial profit or other advantage to which the officer or
director was not legally entitled, or that would be inconsistent with the laws
of the jurisdiction of incorporation (in the case of corporations formed under
the laws of any jurisdiction other than New York), the corporation's certificate
of incorporation, by-laws, resolutions or other proper corporate action or any
court settlement.
II-2
<PAGE>
ITEM 16. EXHIBITS.
(a) Exhibits:
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
- - - -------- -----------------------------------------------------------------------------------------------------------
<S> <C> <C>
1.1(A) -- Form of Underwriting Agreement (Grantor Trust).
1.1(B) -- Form of Underwriting Agreement (Owner Trust-Notes).
1.1(C) -- Form of Underwriting Agreement (Owner Trust-Certificates).
3.1(B) -- Articles of Association of Chase USA.*
3.2(B) -- By-laws of Chase USA.*
4.1(A) -- Form of Pooling and Servicing Agreement (Grantor Trust).
4.1(B) -- Form of Sale and Servicing Agreement (Owner Trust).
4.2 -- Form of Indenture (Owner Trust).
4.3(A) -- Form of Certificate of Trust (Owner Trust).
4.3(B) -- Form of Trust Agreement (Owner Trust).
4.3(C) -- Form of Amended and Restated Trust Agreement (Owner Trust).
4.4 -- Form of Administration Agreement (Owner Trust).
5.1 -- Opinion of Simpson Thacher & Bartlett with respect to legality.
8.1 -- Opinion of Simpson Thacher & Bartlett with respect to tax matters (included as part of Exhibit 5.1).
23.1 -- Consent of Simpson Thacher & Bartlett (included as part of Exhibit 5.1).
23.2 -- Consent of Simpson Thacher & Bartlett (included as part of Exhibit 5.1).
24.1 -- Powers of Attorney of directors and officers of the Registrant.
</TABLE>
- - - ------------------
* Incorporated herein by reference to the identically numbered Exhibit to
Registrant's Registration Statement on Form S-3 (No. 333-7575).
(b) Financial Statements:
Not applicable.
ITEM 17. UNDERTAKINGS.
The undersigned Registrant hereby undertakes:
<TABLE>
<S> <C>
(a) (1) To file, during any period in which offers or sales are being made, a post-effective
amendment to this Registration Statement;
(i) to include any prospectus required by Section 10(a)(3) of the Securities Act of 1933,
as amended (the 'Act');
(ii) to reflect in the prospectus any facts or events arising after the effective date of
the Registration Statement (or the most recent post-effective amendment thereof)
which, individually or in the aggregate, represent a fundamental change in the
information set forth in the Registration Statement. Notwithstanding the foregoing,
any increase or decrease in volume of securities offered (if the total dollar value
of securities offered would not exceed that which was registered) and any deviation
from the low or high and of the estimated maximum offering range may be reflected in
the form of Prospectus filed with the Commission pursuant to Rule 424(b) if, in the
aggregate, the changes in volume and price represent no more than 20 percent change
in the maximum aggregate offering price set forth in the 'Calculation of Registration
Fee' table in the effective Registration Statement.
(iii) to include any material information with respect to the plan of distribution not
previously disclosed in the Registration Statement or any material change to such
information in the Registration Statement;
</TABLE>
II-3
<PAGE>
<TABLE>
<S> <C>
provided, however, that (a)(1)(i) and (a)(1)(ii) will not apply if the information required to be
included in a post-effective amendment thereby is contained in periodic reports filed with or
furnished to the Securities and Exchange Commission (the 'Commission') by the Registrants pursuant
to Section 13 or Section 15(d) of the Securities Exchange Act of 1934, as amended (the 'Exchange
Act') that are incorporated by reference in this Registration Statement.
(2) That, for the purpose of determining any liability under the Act, each such post- effective
amendment shall be deemed to be a new Registration Statement relating to the securities
offered therein, and the offering of such securities at that time shall be deemed to be the
initial bona fide offering hereof.
(3) To remove from the registration by means of a post-effective amendment any of the securities
being registered that remain unsold at the termination of the offering.
(b) That, for purposes of determining any liability under the Act, each filing of a Registrant's annual
report pursuant to Section 13(a) or 15(d) of the Exchange Act (and, where applicable, each filing of
a employee benefit plan's annual report pursuant to Section 15(d) of the Exchange Act) with respect
to any Trust that is incorporated by reference in the Registration Statement shall be deemed to be a
new registration statement relating to the securities offered therein, and the offering of such
securities at that time shall be deemed to be the initial bona fide offering thereof.
(c) To provide to the Underwriters at the closing specified in the Underwriting Agreement certificates
in such denominations and registered in such names as required by the Underwriters to permit prompt
delivery to each purchaser.
(d) That, insofar as indemnification for liabilities arising under the Act may be permitted to
directors, offices and controlling persons of a Registrant pursuant to the foregoing provisions, or
otherwise, the Registrants have been advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as expressed in the Act and is therefore
unenforceable. In the event that a claim for indemnification against such liabilities (other than
payment by a Registrant of expenses incurred or paid by a director, officer or controlling person of
such Registrant in the successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being registered, such
Registrant will, unless in the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question whether such indemnification
by it is against public policy as expressed in the Act and will be governed by the final
adjudication of such issue.
(e) (1) That, for purposes of determining any liability under the Act, the information omitted from
the form of prospectus filed as part of this registration statement in reliance upon Rule
430A and contained in the form of prospectus filed by the Registrant pursuant to Rule
424(b)(1) or (4) or 497(h) under the Act shall be deemed to be part of the registration
statement as of the time it was declared effective.
(2) That, for the purpose of determining any liability under the Act, each post-effective
amendment that contains a form of prospectus shall be deemed to be a new registration
statement relating to the securities offered therein, and the offering of such securities at
the time shall be deemed to be the initial bona fide offering thereof.
(f) That the undersigned Registrants hereby undertake to file an application for the purpose of
determining the eligibility of the trustee to act under subsection (a) of Section 310 of the Trust
Indenture Act of 1939, as amended (the 'Trust Indenture Act'), in accordance with the rules and
regulations prescribed by the Commission under Section 305(b)(2) of the Trust Indenture Act.
</TABLE>
II-4
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended, the
Registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form S-3 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Wilmington, State of Delaware, on September, 1997.
CHASE MANHATTAN BANK USA, NATIONAL
ASSOCIATION
By: __________________________________
Keith W. Schuck
Controller
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed on September , 1997 by the
following persons in the capacities indicated.
<TABLE>
<CAPTION>
SIGNATURE TITLE
- - - ------------------------------------------ ------------------------------------------------------------------
<C> <S>
Chairman of the Board and Director
- - - ------------------------------------------
Donald L. Boudreau
President and Director
- - - ------------------------------------------
Michael Barrett
Director
- - - ------------------------------------------
Luke S. Hayden
Director
- - - ------------------------------------------
John J. Hehir, Jr.
Director
- - - ------------------------------------------
William H. Hoefling
Director
- - - ------------------------------------------
Kevin T. Hurley
Director
- - - ------------------------------------------
Thomas Jacob
Director
- - - ------------------------------------------
John M. Nuzum, Jr.
Chief Financial Officer
- - - ------------------------------------------ Controller (Principal Accounting Officer)
Keith W. Schuck
Director
- - - ------------------------------------------
Michael Urkowitz
</TABLE>
* The undersigned, by signing his name hereto, does hereby sign this
Registration Statement on behalf of the above-indicated directors and officers
of the Registrant pursuant to powers of attorney signed by such officers and
directors.
By:
----------------------------------
Attorney-in-Fact
II-5
<PAGE>
INDEX TO EXHIBITS
<TABLE>
<CAPTION>
EXHIBIT SEQUENTIALLY
NUMBER EXHIBIT NUMBERED PAGE
- - - --------- --------------------------------------------------------------------------------------- --------------
<S> <C> <C>
1.1(A) Form of Underwriting Agreement (Grantor Trust).
1.1(B) Form of Underwriting Agreement (Owner Trust-Notes).
1.1(C) Form of Underwriting Agreement (Owner Trust-Certificates).
3.1(B) Articles of Association of Chase USA.*
3.2(B) By-laws of Chase USA.*
4.1(A) Form of Pooling and Servicing Agreement (Grantor Trust).
4.1(B) Form of Sale and Servicing Agreement (Owner Trust).
4.2 Form of Indenture (Owner Trust).
4.3(A) Form of Certificate of Trust (Owner Trust).
4.3(B) Form of Trust Agreement (Owner Trust).
4.3(C) Form of Amended and Restated Trust Agreement (Owner Trust).
4.4 Form of Administration Agreement (Owner Trust).
5.1 Opinion of Simpson Thacher & Bartlett with respect to legality.
8.1 Opinion of Simpson Thacher & Bartlett with respect to tax matters
(included as part of Exhibit 5.1).
23.1 Consent of Simpson Thacher & Bartlett (included as part of Exhibit 5.1).
23.2 Consent of Simpson Thacher & Bartlett (included as part of Exhibit 5.1).
24.1 Powers of Attorney of directors and officers of the Registrant.
</TABLE>
- - - ------------------
* Incorporated herein by reference to the identically numbered Exhibit to
Registrant's Registration Statement on Form S-3 (No. 333-7575).
<PAGE>
Form of Certificate Underwriting
Agreement (Grantor Trust)
CHASE MANHATTAN BANK USA, N.A.
Seller and Servicer
Chase Manhattan Auto Grantor Trust 199_-_
$____________ __% Automobile Loan Pass-Through Certificates, Class A
$____________ __% Automobile Loan Pass-Through Certificates, Class B
UNDERWRITING AGREEMENT
_________ __, 199_
[--------------------]
as Representative of the
several Underwriters
[--------------------]
[--------------------]
Ladies and Gentlemen:
1. Introductory. Chase Manhattan Bank USA, National
Association, a national banking association (the "Bank"), proposes to form Chase
Manhattan Auto Grantor Trust 199_-_ (the "Trust") pursuant to a Pooling and
Servicing Agreement between the Bank, as Seller and Servicer,
_____________________, as Trustee (the "Trustee") and Collateral Agent (the
"Collateral Agent"), dated as of __________ __, 199_ (the "Pooling and Servicing
Agreement"), which will issue its $_____________ ____% Automobile Loan
Pass-Through Certificates, Class A Certificates (the "Class A Certificates")
and $_____________ ____% Automobile Loan Pass-Through Certificates, Class B
Certificates (the "Class B Certificates" and, together with the Class A
Certificates, the "Certificates").
Each Certificate will represent a fractional undivided interest in the
Trust. The assets of the Trust will include, among other things, a pool of
simple interest retail installment sales contracts and purchase money notes and
other notes (the "Receivables") secured by new and used automobiles (the
"Financed Vehicles") and certain monies due or to become due thereunder on or
after the Cutoff Date (as hereinafter defined), such Receivables to be sold to
the Trust and serviced by the Bank, as Servicer, or by a successor Servicer. The
Original Pool Balance
<PAGE>
of the Receivables as of the opening of business on _________ __, 199_ (the
"Cutoff Date") was $________________. In addition, the Seller will establish a
reserve account (the "Reserve Account") with an initial deposit of cash or
certain investments having an aggregate value of $__________, which Reserve
Account will be pledged to the Collateral Agent for the benefit of the
Certificateholders pursuant to the Agreement. Capitalized terms used herein and
not otherwise herein defined shall have the meanings assigned to such terms in
the Pooling and Servicing Agreement.
This is to confirm the agreement concerning the purchase of
the Certificates from the Bank by the several underwriters named in Schedule I
hereto (the "Underwriters"), for whom Chase Securities Inc. is acting as
representative (the "Representative").
2. Representations and Warranties of the Bank. The Bank
represents and warrants to, and agrees with, the Underwriters, that:
(a) A registration statement on Form S-3 (No.
333-____) has been filed with the Securities and Exchange
Commission (the "Commission") in accordance with the
provisions of the Securities Act of 1933, as amended (the
"Act"), and the Rules and Regulations under the Act (the
"Rules and Regulations"). Such registration statement, as
amended on the date that such registration statement or the
most recent post-effective amendment thereto became effective
under the Act, including the exhibits thereto, is hereinafter
referred to as the "Registration Statement." The Registration
Statement has become effective, and no stop order suspending
the effectiveness of the Registration Statement has been
issued, and no proceeding for that purpose has been instituted
or, to the knowledge of the Bank, threatened by the
Commission. The conditions to the use of a registration
statement on Form S-3 under the Act, as set forth in the
General Instructions to Form S-3, and the conditions of Rule
415 under the Act, have been satisfied with respect to the
Registration Statement. The Bank proposes to file with the
Commission pursuant to Rule 424(b) of the Rules and
Regulations a prospectus supplement to the Base Prospectus (as
defined herein) relating to the sale of the Certificates (the
"Prospectus Supplement"). The base prospectus filed as part of
the Registration Statement, in the form it appears in the
Registration Statement, or in the form most recently revised
and filed with the Commission pursuant to Rule 424(b) of the
Rules and Regulations, is hereinafter referred to as the "Base
Prospectus." The Base Prospectus as supplemented by
2
<PAGE>
the Prospectus Supplement is hereinafter referred to as
the "Prospectus."
(b) Except to the extent that the Representative
shall have agreed to a modification, the Prospectus shall be
in all substantive respects in the form furnished to the
Representative prior to the execution of this Agreement or, to
the extent not completed at such time, shall contain only such
material changes as the Bank has advised the Representative,
prior to such time, will be included or made therein;
(c) The Registration Statement, at the time it became
effective, and the Prospectus, as of the date of the
Prospectus Supplement, complied in all material respects with
the applicable requirements of the Act and the Rules and
Regulations and did not include any untrue statement of a
material fact and, in the case of the Registration Statement,
omit to state any material fact required to be stated therein
or necessary to make the statements therein not misleading
and, in the case of the Prospectus, did not omit to state any
material fact necessary in order to make the statements
therein, in light of the circumstances under which they were
made, not misleading; on the Closing Date (as defined herein),
the Registration Statement and the Prospectus, as amended or
supplemented as of the Closing Date, will comply in all
material respects with the applicable requirements of the Act
and the Rules and Regulations, and neither the Prospectus nor
any amendment or supplement thereto will include any untrue
statement of a material fact or omit to state any material
fact necessary in order to make the statements therein, in
light of the circumstances under which they were made, not
misleading; provided, however, the Bank makes no
representation and warranty as to information contained in or
omitted from the Registration Statement or the Prospectus in
reliance upon, or in conformity with, information furnished in
writing to the Bank by or on behalf of any Underwriter through
the Representative specifically for use in connection with the
preparation of the Registration Statement or the Prospectus;
(d) The Bank is a national banking association
organized under the laws of the United States, with full power
and authority to own its properties and conduct its business
as described in the Prospectus, and had at all relevant times
and has power, authority and legal right to acquire, own, sell
and service the Receivables.
(e) On the Closing Date, the Certificates will have
been duly and validly authorized and, when such Certificates
are duly and validly executed by or on
3
<PAGE>
behalf of the Bank, authenticated by the Trustee and delivered
in accordance with the Pooling and Servicing Agreement and
delivered and paid for as provided herein, will be validly
issued and outstanding and entitled to the benefits and
security afforded by the Pooling and Servicing Agreement.
(f) The execution, delivery and performance by the
Bank of this Agreement and the Pooling and Servicing
Agreement, and the consummation by the Bank of the
transactions provided for herein and therein have been, or
will have been, duly authorized by the Bank by all necessary
action on the part of the Bank; and neither the execution and
delivery by the Bank of such instruments, nor the performance
by the Bank of the transactions herein or therein
contemplated, nor the compliance by the Bank with the
provisions hereof or thereof, will (i) conflict with or result
in a breach or violation of any of the material terms and
provisions of, or constitute a material default under, any of
the provisions of the articles of association or by-laws of
the Bank, or (ii) conflict with any of the provisions of any
law, governmental rule, regulation, judgment, decree or order
binding on the Bank or its properties, or (iii) conflict with
any of the material provisions of any material indenture,
mortgage, contract or other instrument to which the Bank is a
party or by which it is bound, or (iv) result in the creation
or imposition of any lien, charge or encumbrance upon any of
its property pursuant to the terms of any such indenture,
mortgage, contract or other instruments, except, in the case
of clauses (ii) and (iii) for any such breaches or conflicts
as would not individually or in the aggregate have a material
adverse effect on the transactions contemplated hereby or on
the ability of the Bank and the Trust to consummate such
transactions.
(g) When executed and delivered by the parties
thereto, the Pooling and Servicing Agreement will constitute a
legal, valid and binding obligation of the Bank, enforceable
against the Bank in accordance with its terms, except to the
extent that the enforceability thereof may be subject to
bankruptcy, insolvency, reorganization, conservatorship,
moratorium or other similar laws now or hereafter in effect
relating to creditors' rights as such laws would apply in the
event of the insolvency, liquidation or reorganization or
other similar occurrence with respect to the Bank or in the
event of any moratorium or similar occurrence affecting the
Bank and to general principles of equity.
(h) All approvals, authorizations, consents,
orders or other actions of any person, corporation or
4
<PAGE>
other organization, or of any court, governmental agency or
body or official (except with respect to the state securities
or "blue sky" laws of various jurisdictions), required in
connection with the execution, delivery and performance of
this Agreement and the Pooling and Servicing Agreement has
been or will be taken or obtained on or prior to the Closing
Date.
(i) As of the Closing Date, the representations and
warranties of the Bank, as Seller and Servicer, in the Pooling
and Servicing Agreement will be true and correct.
(j) This Agreement has been duly executed and
delivered by the Bank.
3. Purchase, Sale, Payment and Delivery of Certificates. On
the basis of the representations, warranties and agreements herein contained,
but subject to the terms and conditions herein set forth, the Bank agrees to
sell to the Underwriters, and the Underwriters, severally and not jointly, agree
to purchase from the Bank (a) at a purchase price of _____________% of the
principal amount thereof, the respective principal amounts of the Class A
Certificates set forth opposite the names of the Underwriters in Schedule I
hereto and (b) at a purchase price of _____________% of the principal amount
thereof, the respective principal amounts of the Class B Certificates set forth
opposite the names of the Underwriters in Schedule I hereto, plus in each case
accrued interest at the applicable Pass-Through Rate from ____________ __, 199_
to, but excluding, the Closing Date.
The Bank will deliver the Certificates to the Representative
for the respective accounts of the Underwriters against payment of the purchase
price in immediately available funds drawn to the order of the Bank at the
offices of Orrick, Herrington & Sutcliffe in New York, New York at 10 a.m., New
York City time, on _________ __, 199_ or at such other time not later than seven
full business days thereafter as the Representative and the Bank determine, such
time being herein referred to as the "Closing Date." The Certificates so to be
delivered shall be initially represented by a definitive Class A Certificate in
the initial amount of $_____________ registered in the name of Cede & Co., as
nominee for The Depository Trust Company, a definitive Class B Certificate in
the initial amount of $_____________ registered in the name of Cede & Co., as
nominee for The Depository Trust Company and a definitive Class A Certificate in
the amount of $______ registered in the name provided by the Representative. The
Bank shall make such definitive certificates representing the Certificates
available for inspection by the Representative at the office at which the
Certificates are to be delivered no later than 12:00 noon, New York City time,
on the business day prior to the Closing Date.
5
<PAGE>
4. Offering by the Underwriters. It is understood that the
Underwriters propose to offer the Certificates for sale to the public (which may
include selected brokers and dealers) as set forth in the Prospectus.
5. Certain Agreements of the Bank. The Bank covenants and
agrees with the Underwriters that:
(a) The Bank will file the Prospectus with the
Commission pursuant to Rule 424(b) of the Rules and
Regulations within the time prescribed therein and will
provide evidence satisfactory to the Representative of such
timely filing. During any period (a "prospectus delivery
period") that a prospectus relating to the Certificates is
required under the Act to be delivered to purchasers of the
Certificates by Underwriters and dealers participating in the
initial offering and sale of the Certificates on the Closing
Date, the Bank will not file any amendments to the
Registration Statement, or any amendments or supplements to
the Prospectus, unless it shall first have delivered copies of
such amendments or supplements to the Representative, or if
the Representative shall have reasonably objected thereto
promptly after receipt thereof; the Bank will promptly advise
the Representative or its counsel (i) when notice is received
from the Commission that any post-effective amendment to the
Registration Statement has become or will become effective,
(ii) of any request by the Commission for any amendment or
supplement to the Registration Statement or the Prospectus or
for any additional information and (iii) of any order or
communication suspending or preventing, or threatening to
suspend or prevent, the offer and sale of the Certificates or
of any proceedings or examinations that may lead to such an
order or communication, whether by or of the Commission or any
authority administering any state securities or "blue sky"
law, as soon as the Bank is advised thereof, and will use its
reasonable efforts to prevent the issuance of any such order
or communication and to obtain as soon as possible its
lifting, if issued.
(b) If, at any time during the prospectus delivery
period (without regard to any market making prospectus
required by any Underwriter pursuant to the Act), any event
occurs as a result of which the Prospectus as then amended or
supplemented would include an untrue statement of a material
fact or omit to state any material fact necessary in order to
make the statements therein, in the light of the circumstances
under which they were made, not misleading, or if it is
necessary at any time to amend the Prospectus in order to
comply with the Act or the Rules and Regulations, the Bank
promptly will prepare
6
<PAGE>
and file with the Commission (subject to the Representative's
prior review pursuant to paragraph (a) of this Section 5) an
amendment or supplement which will correct such statement or
omission or an amendment or supplement which will effect such
compliance.
(c) The Bank will furnish to the Representative
copies of the Registration Statement, each preliminary
prospectus supplement relating to the Certificates, the
Prospectus, and all amendments and supplements to such
documents, in each case as soon as available and in such
quantities as the Representative may reasonably request.
(d) The Bank will cooperate with the Representative
in arranging for the qualification of the Certificates for
sale and the determination of their eligibility for investment
under the laws of such jurisdictions as the Representative
designates and will continue such qualifications in effect so
long as required for the distribution of the Certificates;
provided, however, that neither the Bank nor the Trust shall
be obligated to qualify to do business in any jurisdiction in
which it is not currently so qualified or to take any action
which would subject it to general or unlimited service of
process in any jurisdiction where it is not now so subject.
(e) For a period from the date of this Agreement
until the retirement of the Certificates, the Bank, as
Servicer, will furnish to the Representative copies of each
certificate and the annual statements of compliance delivered
to independent certified public accountants pursuant to
Article IV of the Pooling and Servicing Agreement and the
annual independent public accountant's reports furnished to
the Trustee pursuant to Article IV of the Pooling and
Servicing Agreement, as soon as practicable after such
statements and reports are furnished to such certified public
accountants or the Trustee, as the case may be.
(f) So long as any of the Certificates are
outstanding, the Bank will furnish to the Representative as
soon as practicable, (A) all documents distributed, or caused
to be distributed by the Bank to the Certificateholders, (B)
all documents filed, or caused to be filed, by the Bank with
respect to the Trust with the Commission pursuant to the
Securities Exchange Act of 1934, as amended (the "Exchange
Act"), and any order of the Commission thereunder or pursuant
to a "no-action" letter from the staff of the Commission and
(C) from time to time, such other information in the
possession of the Bank concerning the Trust and any other
information
7
<PAGE>
concerning the Bank filed with any governmental or regulatory
authority which is otherwise publicly available, as the
Representative may reasonably request.
(g) On or before the Closing Date, the Bank shall
cause its computer records relating to the Receivables to be
marked to show the Trust's absolute ownership of the
Receivables, and from and after the Closing Date the Bank
shall not, as Seller or Servicer, take any action inconsistent
with the Trust's ownership of such Receivables, other than as
permitted by the Pooling and Servicing Agreement.
(h) To the extent, if any, that the rating provided
with respect to the Certificates by Standard & Poor's, Moody's
and/or Fitch is conditional upon the furnishing of documents
or the taking of any other action by the Bank agreed upon on
or prior to the Closing Date, the Bank shall furnish such
documents and take any such action.
(i) For the period beginning on the date hereof and
ending on the Closing Date, unless waived by the
Representative, neither the Bank nor any trust originated,
directly or indirectly, by the Bank will offer to sell or sell
notes collateralized by, or certificates (other than the
Certificates) evidencing an ownership interest in, receivables
generated pursuant to retail automobile or light duty truck
installment sale contracts.
6. Payment of Expenses. The Bank will pay all expenses
incident to the performance of its obligations under this Agreement, including
(i) the printing and filing of the Registration Statement as originally filed
and of each amendment thereto, (ii) the Trustee's acceptance fee and the fees
and disbursements of the counsel to the Trustee, (iii) the fees and
disbursements of the accountants, (iv) the fees of the Rating Agencies and (v)
blue sky expenses; provided, however, that the Underwriters may reimburse the
Bank for certain expenses incurred by the Bank as agreed to by the Underwriters
and the Bank.
7. Conditions to the Obligations of the Underwriters. The
obligation of the several Underwriters to purchase and pay for the Certificates
will be subject to the accuracy of the representations and warranties on the
part of the Bank herein, on the date hereof and as of the Closing Date, to the
accuracy of the statements of officers of the Bank made pursuant to the
provisions hereof, to the performance by the Bank of its obligations hereunder
and to the following additional conditions precedent:
8
<PAGE>
(a) On or prior to the date hereof, the
Representative shall have received a letter (a "Procedures
Letter"), dated the date of this Agreement of _____________
and _____________ verifying the accuracy of such financial and
statistical data contained in the Prospectus as the
Representative shall deem reasonably advisable. In addition,
if any amendment or supplement to the Prospectus made after
the date hereof contains financial or statistical data, the
Representative shall have received a letter dated the Closing
Date confirming each Procedures Letter and providing
additional comfort on such new data.
(b) The Prospectus Supplement shall have been filed
in the manner and within the time period required by Rule
424(b) of the Rules and Regulations; and prior to the Closing
Date, no stop order suspending the effectiveness of the
Registration Statement shall have been issued and no
proceedings for that purpose shall have been instituted or
threatened.
(c) Subsequent to the execution and delivery of this
Agreement, there shall not have occurred (i) any change, or
any development involving a prospective change, in or
affecting particularly the business or properties of the Bank,
The Chase Manhattan Bank or The Chase Manhattan Corporation
which, in the reasonable judgment of the Representative,
materially impairs the investment quality of the Certificates
or makes it impractical to market the Certificates; (ii) any
suspension or material limitation of trading in securities
generally on the New York Stock Exchange, or any setting of
minimum prices for trading on such exchange, or any suspension
of trading of any securities of the Bank, The Chase Manhattan
Bank or of The Chase Manhattan Corporation on any exchange or
in the over-the-counter market by such exchange or
over-the-counter market or by the Commission; (iii) any
banking moratorium declared by federal or New York
authorities; or (iv) any outbreak or material escalation of
major hostilities or any other substantial national or
international calamity or emergency if, in the reasonable
judgment of the Representative, the effect of any such
outbreak, escalation, calamity or emergency on the United
States financial markets makes it impracticable or inadvisable
to proceed with completion of the sale of and any payment for
the Certificates.
(d) The Representative shall have received opinions,
of Simpson Thacher & Bartlett, special counsel to the Bank
and/or such other counsel otherwise reasonably acceptable to
the Representative, when taken together, with respect to such
matters as are customary
9
<PAGE>
for the type of transaction contemplated by this
Agreement.
(e) The Representative shall have received an opinion
or opinions of Simpson Thacher & Bartlett, special counsel to
the Bank, dated the Closing Date and satisfactory in form and
substance to the Representative, with respect to certain
matters relating to the transfers of the Receivables from the
Bank to the Trust, with respect to the perfection of the
Trust's interests in the Receivables and with respect to
certain other matters as are customary for the type of
transaction contemplated by this Agreement.
(f) The Representative shall have received from
Orrick, Herrington & Sutcliffe, counsel to the Underwriters,
such opinion or opinions, dated the Closing Date and
satisfactory in form and substance to the Representative, with
respect to the validity of the Certificates, the Registration
Statement, the Prospectus and other related matters as the
Representative may require, and the Bank shall have furnished
to such counsel such documents as they reasonably request for
the purpose of enabling them to pass upon such matters.
(g) The Representative shall have received an opinion
of Simpson Thacher & Bartlett, special tax counsel to the
Bank, dated the Closing Date and reasonably satisfactory in
form and substance to the Representative, with respect to such
matters as are customary for the type of transaction
contemplated by this Agreement.
(h) The Representative shall have received an opinion
of counsel to the Trustee and the Collateral Agent
(collectively, "________"), dated the Closing Date and
reasonably satisfactory in form and substance to the
Representative, substantially to the effect that:
(i) ___________ has been duly
incorporated and is validly existing as a banking
corporation in good standing under the laws of the
[______________________];
(ii) ___________ has full corporate
trust power and authority to enter into and perform
its obligations under the Pooling and Servicing
Agreement;
(iii) The Pooling and Servicing
Agreement has been duly authorized, executed and
delivered by __________ and constitutes a valid
10
<PAGE>
and legally binding agreement of ________,
enforceable against _______ in accordance with its
terms, subject, as to enforcement of remedies, (a) to
applicable bankruptcy, insolvency, reorganization,
and other similar laws affecting the rights of
creditors generally, and (b) to general principles of
equity (regardless of whether such enforceability is
considered in a proceeding in equity or at law);
(iv) _______ has duly executed and
authenticated the Certificates issued on the date
hereof on behalf of the Trust;
(v) No consent, approval or
authorization of, or registration, declaration or
filing with, or giving of notice to or the taking of
any other act with respect to any court or
governmental authority, agency or body of the United
States of America or of any state governing the trust
powers of ________ is required under any existing
laws or regulation for the consummation on the part
of _______ of any of the transactions contemplated in
the Pooling and Servicing Agreement or the
performance by ________ thereunder, except such as
have been obtained; and
(vi) The execution and delivery of
the Pooling and Servicing Agreement and the
performance by _________ of the terms thereof do not
conflict with or result in a violation of (1) any
laws or regulations of [___________________] or of
any state governing the trust powers of __________,
(2) the Articles of Incorporation or By-Laws of
_________ or (3) any material agreement, instrument,
order, writ, judgment or decree known to such counsel
to which ___________ is a party or is subject.
In rendering such opinions, counsel to ___________ may rely on
the opinion of the office of the general counsel to ____.
(i) The Representative shall have received evidence
satisfactory to the Representative that (a) the Class A
Certificates have been rated in the highest rating category by
each of Standard & Poor's, Moody's and Fitch and (b) the
Class B Certificates have been rated at least "[__]" by
Standard & Poor's, "[__]" by Moody's and "[__]" by Fitch.
(j) The Representative shall have received a
certificate, dated the Closing Date, of a Vice President or
more senior officer of the Bank in which such officer, to the
best of his or her knowledge after
11
<PAGE>
reasonable investigation, shall state that (i) the
representations and warranties of the Bank in this Agreement
are true and correct in all material respects on and as of the
Closing Date, (ii) that the Bank has complied with all
agreements and satisfied all conditions on its part to be
performed or satisfied hereunder at or prior to the Closing
Date, (iii) the representations and warranties of the Bank, as
Seller and Servicer, in the Pooling and Servicing Agreement
are true and correct as of the dates specified in the Pooling
and Servicing Agreement, (iv) that no stop order suspending
the effectiveness of the Registration Statement has been
issued and no proceedings for that purpose have been
instituted or are threatened by the Commission, (v) that,
subsequent to the date of the Prospectus, there has been no
material adverse change in the financial position or results
of operation of the Bank's automotive finance business except
as set forth in or contemplated by the Prospectus or as
described in such certificate and (vi) the Prospectus does not
contain any untrue statement of a material fact or omit to
state a material fact required to be stated therein or
necessary in order to make the statements therein, in light of
the circumstances in which they were made, not misleading.
The Bank will furnish the Representative, or cause the
Representative to be furnished, with such number of conformed copies of such
opinions, certificates, letters and documents as the Representative reasonably
requests.
8. Indemnification.
(a) The Bank will indemnify and hold harmless each
Underwriter against any losses, claims, damages or liabilities
to which such Underwriter may become subject, under the Act or
otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of, or
are based upon, any untrue statement or alleged untrue
statement of any material fact contained in any preliminary
prospectus supplement, the Registration Statement (other than
any market making prospectus), the Prospectus, or any
amendment or supplement thereto (other than any market making
prospectus or any amendment or supplement thereto), or arise
out of, or are based upon, the omission or alleged omission to
state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading; and
will reimburse each Underwriter for any legal or other
expenses reasonably incurred by such Underwriter in connection
with investigating or defending any such action or claim;
provided, however, that (i) the Bank shall not be liable in
any such case
12
<PAGE>
to the extent that any such loss, claim, damage or liability
arises out of, or is based upon, an untrue statement or
alleged untrue statement or omission or alleged omission made
in any preliminary prospectus supplement, the Registration
Statement or the Prospectus or any such amendment or
supplement in reliance upon and in conformity with written
information furnished to the Bank by any Underwriter through
the Representative expressly for use therein, and (ii) such
indemnity with respect to any preliminary prospectus
supplement shall not inure to the benefit of the Underwriter
(or any person controlling any such Underwriter) from whom the
person asserting any such loss, claim, damage or liability
purchased the Certificates which are the subject thereof if
such person did not receive a copy of the Prospectus (or the
Prospectus as supplemented) at or prior to the confirmation of
the sale of such Certificates to such person in any case where
such delivery is required by the Act and the untrue statement
or omission of a material fact contained in such preliminary
prospectus supplement was corrected in the Prospectus (or the
Prospectus as supplemented).
(b) Each Underwriter severally agrees to indemnify
and hold harmless the Bank, its directors, each of its
officers or agents who signed the Registration Statement, and
each person, if any, who controls the Bank within the meaning
of Section 15 of the Act against any and all loss, liability,
claim, damage and expense described in the indemnity contained
in subsection (a) of this Section 8, as incurred, but only
with respect to untrue statements or omissions, or alleged
untrue statements or omissions, made in any preliminary
prospectus supplement, the Registration Statement or the
Prospectus (or any amendment or supplement thereto) in
reliance upon and in conformity with written information
furnished to the Bank by such Underwriter through the
Representative expressly for use in such preliminary
prospectus supplement, the Registration Statement or the
Prospectus (or any amendment or supplement thereto).
(c) Each indemnified party shall give prompt notice
to the indemnifying party of any action commenced against the
indemnified party in respect of which indemnity may be sought
hereunder, but failure to so notify an indemnifying party
shall not relieve such indemnifying party from any liability
which it may have hereunder or otherwise, other than on
account of this indemnity agreement. In case any such action
shall be brought against an indemnified party and it shall
have notified the indemnifying party of the commencement
thereof, the indemnifying party shall be entitled to
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<PAGE>
participate therein and, to the extent that it shall wish, to
assume the defense thereof, with counsel reasonably
satisfactory to such indemnified party (who shall not, except
with the consent of the indemnified party, be counsel to the
indemnifying party with respect to such action), and it being
understood that the indemnifying party shall not, in
connection with any one such action or separate but
substantially similar or related actions in the same
jurisdiction arising out of the same general allegations or
circumstances, be liable for the reasonable fees and expenses
of more than one separate firm of attorneys, and, after notice
from the indemnifying party to the indemnified party of its
election so to assume the defense thereof, the indemnifying
party shall not be liable to the indemnified party under
subsections (a) or (b) of this Section 8 for any legal
expenses of other counsel or any other expenses, in each case
subsequently incurred by the indemnified party, in connection
with the defense thereof other than reasonable costs of
investigation.
(d) The obligations of the Bank under this Section 8
shall be in addition to any liability which the Bank may
otherwise have and shall extend, upon the same terms and
conditions, to each person, if any, who controls any
Underwriter within the meaning of the Act; and each
Underwriter's obligations under this Section 8 shall be in
addition to any liability which such Underwriter may otherwise
have and shall extend, upon the same terms and conditions, to
each officer and director of the Bank and to each person, if
any, who controls the Bank within the meaning of Section 15 of
the Act.
9. Contribution. In order to provide for just and equitable
contribution in circumstances in which the indemnity agreement provided for in
Section 8 is for any reason held to be unavailable other than in accordance with
its terms, the Bank and the Underwriters shall contribute to the aggregate
losses, liabilities, claims, damages and expenses of the nature contemplated by
said indemnity agreement incurred by the Bank or the Underwriters, as incurred,
in such proportions so that the Underwriters are responsible for that portion
represented by the percentage that the underwriting discount and commissions
bear to the initial public offering price appearing thereon and the Bank is
responsible for the balance; provided, however, that no person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the Act)
shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation. For purposes of this Section, each person, if any,
who controls an Underwriter within the meaning of Section 15 of the Act shall
have the same rights to contribution as such Underwriter, and each director of
the Bank, each officer or agent
14
<PAGE>
of the Bank who signed the Registration Statement, and each person, if any, who
controls the Bank within the meaning of Section 15 of the Act shall have the
same rights to contribution as the Bank.
10. Default of Underwriters. If any Underwriter defaults in
its obligations to purchase Certificates hereunder and the aggregate principal
amount of the Certificates that such defaulting Underwriter agreed but failed to
purchase does not exceed 10% of the total principal amount of such Certificates,
the Representative may make arrangements satisfactory to the Bank for the
purchase of such Certificates by other persons, including the non-defaulting
Underwriters, but if no such arrangements are made by the Closing Date, the
non-defaulting Underwriters shall be obligated severally, in proportion to their
respective commitments hereunder, to purchase the Certificates that such
defaulting Underwriter agreed but failed to purchase. If any Underwriter so
defaults and the aggregate principal amount of the Certificates with respect to
which such default or defaults occur exceeds 10% of the total principal amount
of such Certificates and arrangements satisfactory to the Representative and the
Bank for the purchase of such Certificates by other persons are not made within
36 hours after such default, this Agreement will terminate without liability on
the part of any non-defaulting Underwriter or the Bank, except as provided in
Section 11. Nothing herein will relieve a defaulting Underwriter from liability
for its default.
11. Survival of Certain Representations and Obligations. The
respective indemnities, agreements, representations, warranties and other
statements of the Bank or its officers and of the Underwriters set forth in or
made pursuant to this Agreement will remain in full force and effect, regardless
of any investigation, or statement as to the results thereof, made by or on
behalf of the Underwriters, the Bank or any of their respective representatives,
officers or directors or any controlling person, and will survive delivery of
and payment for the Certificates. If for any reason the purchase of the
Certificates by the Underwriters is not consummated, the Bank shall remain
responsible for the expenses to be paid or reimbursed by it pursuant to Section
6 and the respective obligations of the Bank and the Underwriters pursuant to
Sections 8 and 9 shall remain in effect. If the purchase of the Certificates by
the Underwriters is not consummated for any reason other than solely because of
the occurrence of any event specified in clauses (ii), (iii) or (iv) of Section
7(c), the Bank will reimburse the Underwriters for all out-of-pocket expenses
(including fees and disbursements of counsel) reasonably incurred by it in
connection with the offering of the Certificates.
12. Notices. All communications hereunder will be in
writing and, if sent to the Representative or the Underwriters,
will be mailed, delivered or telegraphed and confirmed to the
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Representative at [__________________________________________],
Attention: [___________________________], or, if sent to the
Bank, will be mailed, delivered or telegraphed and confirmed to
c/o Chase Manhattan Automotive Finance Corporation, 900 Stewart
Avenue, Garden City, New York 11530, Attention: Financial
Controller.
13. Successors. This Agreement will inure to the benefit of,
and be binding upon, the parties hereto and their respective successors. Nothing
expressed or mentioned in this Agreement is intended or shall be construed to
give any person, firm or corporation, other than the parties hereto and their
respective successors and the controlling persons and officers and directors
referred to in Sections 8 and 9 and their heirs and legal representatives, any
legal or equitable right, remedy or claim under or in respect of this Agreement
or any provision herein contained. This Agreement and all conditions and
provisions hereof are intended to be for the sole and exclusive benefit of the
parties hereto and their respective successors, and said controlling persons and
officers and directors and their heirs and legal representatives, and for the
benefit of no other person, firm or corporation. No purchaser of Certificates
from any Underwriter shall be deemed to be a successor by reason merely of such
purchase.
14. Counterparts. This Agreement may be executed in any
number of counterparts, each of which shall be deemed to be an original, but all
such counterparts shall together constitute one and the same Agreement.
15. APPLICABLE LAW. THIS AGREEMENT SHALL BE GOVERNED BY,
AND INTERPRETED AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW
YORK.
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If the foregoing is in accordance with the Representative's
understanding of our agreement, kindly sign and return to us the enclosed
duplicate hereof, whereupon it will become a binding agreement among the Bank
and the Underwriters in accordance with its terms.
Very truly yours,
CHASE MANHATTAN BANK USA, NATIONAL ASSOCIATION
By: _____________________________
Name:
Title:
The foregoing Underwriting Agreement is hereby confirmed and accepted as of the
date first written above.
[-------------------]
on behalf of itself and as Representative of
the Several Underwriters named in Schedule I
By: _____________________________
Name:
Title:
17
<PAGE>
SCHEDULE I
----------
Aggregate Aggregate
Principal Principal
Amount of Amount of
Class A Class B
Underwriters Certificates Certificates
- - - ------------ ------------ ------------
Total $ $
18
<PAGE>
FORM OF NOTE
UNDERWRITING AGREEMENT
(OWNER TRUST)
CHASE MANHATTAN AUTO OWNER TRUST 199_-_
ASSET BACKED NOTES
CHASE MANHATTAN BANK USA, N.A.
Seller and Servicer,
NOTE UNDERWRITING AGREEMENT
----------, ----
[--------------------]
As Representative of the
Several Underwriters,
[--------------------]
[--------------------]
Ladies and Gentlemen:
1. Introductory. Chase Manhattan Bank USA, National
Association, a national banking association (the "Bank"), proposes to form Chase
Manhattan Auto Owner Trust 199_-_ (the "Trust") to sell $___________ aggregate
principal amount of Class A-1 _____% Asset Backed Notes (the "Class A-1 Notes"),
$___________ aggregate principal amount of Class A-2 _____% Asset Backed Notes
(the "Class A-2 Notes"), $____________ aggregate principal amount of Class A-3
_____% Asset Backed Notes (the "Class A-3 Notes"), $___________ aggregate
principal amount of Class A-4 _____% Asset Backed Notes (the "Class A-4 Notes")
and $__________ aggregate principal amount of Class [A-5] [B] _____% Asset
Backed Notes (the "Class [A-5] [B] Notes" and, together with the Class A-1
Notes, the Class A-2 Notes, the Class A-3 Notes and the Class A-4 Notes, the
"Notes").
The assets of the Trust will include, among other things, a
pool of simple interest retail installment sales contracts and purchase money
notes and other notes (the "Receivables") secured by new and used automobiles
(the "Financed Vehicles") and certain monies received thereunder on or after the
Cutoff Date (as hereinafter defined), such Receivables to be transferred to the
Trust and serviced by the Bank, as Servicer, or by a successor Servicer. The
Original Pool Balance of the Receivables as of the close of business on
__________, 199_ (the "Cut-off Date") was equal to $________________. The Notes
will be issued pursuant to the Indenture to be dated as of __________, 199_ (as
amended and supplemented from time to time, the "Indenture"), between the Trust
and ______________________
<PAGE>
_______, ____________________, as indenture trustee (the "Indenture Trustee").
Simultaneously with the issuance and sale of the Notes as
contemplated herein, the Trust will issue $_____________ aggregate principal
amount of _____% Asset Backed Certificates (the "Certificates") pursuant to the
Amended and Restated Trust Agreement to be dated as of __________, 199_ (as
amended and supplemented from time to time, the "Trust Agreement"), between the
Bank and ________________________, as owner trustee (the "Owner Trustee"), each
representing a fractional undivided ownership interest in the Trust[, which will
be sold pursuant to an underwriting agreement dated the date hereof (the
"Certificate Underwriting Agreement" and, together with this Agreement, the
"Underwriting Agreements") between the Bank and [________] [to the Bank]. The
Notes and the Certificates are sometimes referred to collectively herein as the
"Securities".
Capitalized terms used and not otherwise defined herein shall
have the meanings assigned to such terms in the Sale and Servicing Agreement to
be dated as of __________, 199_ (as amended and supplemented from time to time,
the "Sale and Servicing Agreement"), between the Trust and the Bank, as Seller
and Servicer.
This is to confirm the agreement concerning the purchase of
the Notes from the Bank by the several underwriters named in Schedule I hereto
(the "Underwriters"), for whom Chase Securities Inc. is acting as representative
(the "Representative").
2. Representations and Warranties of the Bank. The
Bank represents and warrants to, and agrees with, the Underwriters, that:
(a) A registration statement on Form S-3 (No. 333-____) has
been filed with the Securities and Exchange Commission (the "Commission") in
accordance with the provisions of the Securities Act of 1933, as amended (the
"Act"), and the Rules and Regulations under the Act (the "Rules and
Regulations"). Such registration statement, as amended on the date that such
registration statement or the most recent post-effective amendment thereto
became effective under the Act, including the exhibits thereto, is hereinafter
referred to as the "Registration Statement." The Registration Statement has
become effective, and no stop order suspending the effectiveness of the
Registration Statement has been issued, and no proceeding for that purpose has
been instituted or, to the knowledge of the Bank, threatened by the Commission.
The conditions to the use of a registration statement on Form S-3 under the Act,
as set forth in the General Instructions to Form S-3, and the conditions of Rule
415 of the Rules and Regulations, have been satisfied with respect to the
Registration Statement. The Bank proposes to file with the Commission pursuant
to Rule 424(b) of the Rules and Regulations a
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<PAGE>
prospectus supplement to the Base Prospectus (as defined herein) relating to the
sale of the [Securities] [Notes] (the "Prospectus Supplement"). The base
prospectus filed as part of the Registration Statement, in the form it appears
in the Registration Statement, or in the form most recently revised and filed
with the Commission pursuant to Rule 424(b), is hereinafter referred to as the
"Base Prospectus." The Base Prospectus as supplemented by the Prospectus
Supplement is hereinafter referred to as the "Prospectus."
(b) Except to the extent that the Representative shall have
agreed to a modification, the Prospectus shall be in all substantive respects in
the form furnished to the Representative prior to the execution of this
Agreement or, to the extent not completed at such time, shall contain only such
material changes as the Bank has advised the Representative, prior to such time,
will be included or made therein.
(c) The Registration Statement, at the time it became
effective, and the Prospectus, as of the date of the Prospectus Supplement,
complied in all material respects with the applicable requirements of the Act
and the Trust Indenture Act of 1939 and the Rules and Regulations and did not
include any untrue statement of a material fact and, in the case of the
Registration Statement, did not omit to state any material fact required to be
stated therein or necessary to make the statements therein not misleading and,
in the case of the Prospectus, did not omit to state any material fact necessary
in order to make the statements therein, in light of the circumstances under
which they were made, not misleading; on the Closing Date (as defined herein),
the Registration Statement and the Prospectus, as amended or supplemented as of
the Closing Date, will comply in all material respects with the applicable
requirements of the Act and the Rules and Regulations, and neither the
Prospectus nor any amendment or supplement thereto will include any untrue
statement of a material fact or omit to state any material fact necessary in
order to make the statements therein, in light of the circumstances under which
they were made, not misleading; provided, however, that the Bank makes no
representation and warranty with respect to information contained in or omitted
from the Registration Statement or the Prospectus in reliance upon, or in
conformity with, information furnished in writing to the Bank by or on behalf of
any Underwriter through the Representative specifically for use in connection
with the preparation of the Registration Statement or the Prospectus.
(d) The Bank is a national banking association organized under
the laws of the United States, with full power and authority to own its
properties and conduct its business as described in the Prospectus, and had at
all relevant times and has power, authority and legal right to acquire, own,
sell and service the Receivables.
3
<PAGE>
(e) When the Notes have been duly executed and delivered by
the Owner Trustee and, when authenticated by the Indenture Trustee in accordance
with the Indenture and delivered upon the order of the Bank to the Underwriters
pursuant to this Agreement and the Sale and Servicing Agreement, the Notes will
be duly issued and will constitute legal, valid and binding obligations of the
Trust enforceable against the Trust in accordance with their terms, except to
the extent that the enforceability thereof may be subject to bankruptcy,
insolvency, reorganization, conservatorship, moratorium or other similar laws
now or hereafter in effect relating to creditors' rights as such laws would
apply in the event of the insolvency, liquidation or reorganization or other
similar occurrence with respect to the Bank or the Trust or in the event of any
moratorium or similar occurrence affecting the Bank or the Trust and to general
principles of equity.
(f) The direction by the Bank to the Owner Trustee to execute
and authenticate the Certificates has been duly authorized by the Bank and, when
the Certificates have been duly executed, authenticated and delivered by the
Owner Trustee in accordance with the Trust Agreement and delivered upon the
order of the Bank [to _______________] [to the Bank] [pursuant to the
Certificate Underwriting Agreement and] the Sale and Servicing Agreement, the
Certificates will be duly issued and entitled to the benefits and security
afforded by the Trust Agreement.
(g) The execution, delivery and performance by the Bank of
this Agreement[, the Certificate Underwriting Agreement,] and the Basic
Documents to which the Bank is a party, and the consummation by the Bank of the
transactions provided for herein and therein have been, or will have been, duly
authorized by the Bank by all necessary action on the part of the Bank; and
neither the execution and delivery by the Bank of such instruments, nor the
performance by the Bank of the transactions herein or therein contemplated, nor
the compliance by the Bank with the provisions hereof or thereof, will (i)
conflict with or result in a breach or violation of any of the material terms
and provisions of, or constitute a material default under, any of the provisions
of the articles of association or by-laws of the Bank, or (ii) conflict with any
of the provisions of any law, governmental rule, regulation, judgment, decree or
order binding on the Bank or its properties, or (iii) conflict with any of the
material provisions of any material indenture, mortgage, contract or other
instrument to which the Bank is a party or by which it is bound, or (iv) result
in the creation or imposition of any lien, charge or encumbrance upon any of its
property pursuant to the terms of any such indenture, mortgage, contract or
other instruments, except, in the case of clauses (ii) and (iii) , for any such
breaches or conflicts as would not individually or in the aggregate have a
material adverse effect on the transactions contemplated hereby or on the
ability of the Bank to consummate such transactions.
4
<PAGE>
(h) When executed and delivered by the parties thereto, each
of the Sale and Servicing Agreement and the Trust Agreement will constitute a
legal, valid and binding obligation of the Bank, enforceable against the Bank in
accordance with its terms, except to the extent that the enforceability thereof
may be subject to bankruptcy, insolvency, reorganization, conservatorship,
moratorium or other similar laws now or hereafter in effect relating to
creditors' rights as such laws would apply in the event of the insolvency,
liquidation or reorganization or other similar occurrence with respect to the
Bank or in the event of any moratorium or similar occurrence affecting the Bank
and to general principles of equity.
(i) All approvals, authorizations, consents, orders or other
actions of any person, corporation or other organization, or of any court,
governmental agency or body or official (except with respect to the state
securities or "blue sky" laws of various jurisdictions), if so required in
connection with the execution, delivery and performance of this Agreement[, the
Certificate Underwriting Agreement] and the Basic Documents to which the Bank is
a party, have been or will be taken or obtained on or prior to the Closing Date.
(j) As of the Closing Date, the representations and
warranties of the Bank, as Seller and Servicer, in the Trust Agreement will be
true and correct.
(k) This Agreement [and the Certificate Underwriting
Agreement] [have] [has] been duly executed and delivered by the Bank.
3. Purchase, Sale, Payment and Delivery of the Notes. On the
basis of the representations, warranties and agreements herein contained, but
subject to the terms and conditions herein set forth, the Bank agrees to sell to
each Underwriter, and each Underwriter agrees, severally and not jointly, to
purchase from the Bank, (a) at a purchase price of _________% of the principal
amount thereof, the principal amount of the Class A-1 Notes set forth opposite
the name of such Underwriter in Schedule I hereto, (b) at a purchase price of
_________% of the principal amount thereof, the principal amount of the Class
A-2 Notes set forth opposite the name of such Underwriter in Schedule I hereto,
(c) at a purchase price of _________% of the principal amount thereof, the
principal amount of the Class A-3 Notes set forth opposite the name of such
Underwriter in Schedule I hereto, (d) at a purchase price of _________% of the
principal amount thereof, the principal amount of the Class A-4 Notes set forth
opposite the name of such Underwriter in Schedule I hereto and (e) at a purchase
price of _________% of the principal amount thereof, the principal amount of the
Class [A-5] [B] Notes set forth opposite the name of such underwriter in
Schedule I hereto plus, in each case, accrued interest at the applicable
Interest Rate from _________, 199_ to but excluding the Closing Date.
5
<PAGE>
The Bank will deliver the Notes to the Representative for the
respective accounts of the Underwriters against payment of the purchase price in
immediately available funds drawn to the order of the Bank at the offices of
Orrick, Herrington & Sutcliffe LLP in New York, New York at 10:00 a.m., New York
City time, on _________, 199_ or at such other time not later than seven full
business days thereafter as the Representative and the Bank determine, such time
being herein referred to as the "Closing Date." The Notes of each class to be so
delivered will be initially represented by one or more definitive Notes
registered in the name of Cede & Co., the nominee of The Depository Trust
Company ("DTC") and will be made available for inspection by the Representative
at the office where delivery and payment for such Notes is to take place no
later than 1:00 p.m., New York City time, on the Business Day prior to the
Closing Date.
4. Offering by the Underwriters. It is understood that the
Underwriters propose to offer the Notes for sale to the public (which may
include selected brokers and dealers) as set forth in the Prospectus. [Each
Underwriter has represented and agreed that (a) it has only issued or passed on
and will only issue or pass on in the United Kingdom any document received by it
in connection with the issue of the Notes to a person who is of a kind described
in Article 11(3) of the Financial Services Act 1986 (Investment Advertisements )
(Exemptions) Order 1996 or who is a person to whom the document may otherwise
lawfully be issued or passed on, (b) it has complied and will comply with all
applicable provisions of the Financial Services Act 1986 with respect to
anything done by it in relation to the Notes in, from or otherwise involving the
United Kingdom and (c) if the Underwriter is an authorized person under Chapter
III of Part I of the Financial Services Act 1986, it has only promoted and will
only promote (as that term is defined in Regulation 1.02 of the Financial
Services Act 1986 (Promotion of Unregulated Schemes) Regulations 1991) to any
person in the United Kingdom the scheme described herein if that person is of a
kind described either in Section 76(2) of the Financial Services Act 1986 or in
Regulation 1.04 of the Financial Services Act 1986 (Promotion Unregulated
Schemes) Regulations 1991.]
5. Covenants of the Bank. The Bank covenants and agrees
with the Underwriters that:
(a) The Bank will file the Prospectus with the Commission
pursuant to Rule 424(b) of the Rules and Regulations within the time prescribed
therein and will provide evidence satisfactory to the Representative of such
timely filing. During any period that a prospectus relating to the Notes is
required to be delivered to purchasers of the Notes by the Underwriters and
dealers participating in the initial offering and sale of the Notes on the
Closing Date under the Act (without regard to any market making prospectus
required to be delivered by any Underwriter under the Act) (a "prospectus
delivery period"), the
6
<PAGE>
Bank will not file any amendments to the Registration Statement, or any
amendments or supplements to the Prospectus, unless it shall first have
delivered copies of such amendments or supplements to the Representative, and if
the Representative shall have reasonably objected thereto promptly after receipt
thereof; the Bank will promptly advise the Representative or its counsel (i)
when notice is received from the Commission that any post-effective amendment to
the Registration Statement has become or will become effective, (ii) of any
request by the Commission for any amendment or supplement to the Registration
Statement or the Prospectus or for any additional information and (iii) of any
order or communication suspending or preventing, or threatening to suspend or
prevent, the offer and sale of the Notes or of any proceedings or examinations
that may lead to such an order or communication, whether by or of the Commission
or any authority administering any state securities or "blue sky" law, as soon
as the Bank is advised thereof, and will use its reasonable efforts to prevent
the issuance of any such order or communication and to obtain as soon as
possible its lifting, if issued.
(b) If, at any time during the prospectus delivery period, any
event occurs as a result of which the Prospectus as then amended or supplemented
would include an untrue statement of a material fact or omit to state any
material fact necessary in order to make the statements therein, in the light of
the circumstances under which they were made, not misleading, or if it is
necessary at any time to amend the Prospectus in order to comply with the Act or
the Rules and Regulations, the Bank promptly will prepare and file with the
Commission (subject to the Representative's prior review pursuant to paragraph
(a) of this Section 5), an amendment or supplement which will correct such
statement or omission or an amendment or supplement which will effect such
compliance.
(c) The Bank will furnish to the Representative copies of the
Registration Statement, each preliminary prospectus supplement relating to the
Notes, the Prospectus, and all amendments and supplements to such documents, in
each case as soon as available and in such quantities as the Representative may
reasonably request.
(d) The Bank will cooperate with the Representative in
arranging for the qualification of the Notes for sale and the determination of
their eligibility for investment under the laws of such jurisdictions, or as
necessary to qualify for the Euroclear System or Cedel Bank, societe anonyme, as
the Representative designates and will cooperate in continuing such
qualifications in effect so long as required for the distribution of the Notes;
provided, however, that neither the Bank nor the Trust shall be obligated to
qualify to do business in any jurisdiction in which it is not currently so
qualified or to take any action which would subject it to general or unlimited
service of process in any jurisdiction where it is not now so subject.
7
<PAGE>
(e) For a period from the date of this Agreement until the
retirement of the Notes, the Bank, as Servicer, will furnish to the
Representative copies of each certificate and the annual statements of
compliance delivered to the Noteholders and the independent certified public
accountants' and reports furnished to the Indenture Trustee or the Owner Trustee
pursuant to the Sale and Servicing Agreement, as soon as practicable after such
statements and reports are furnished to the Indenture Trustee or the Owner
Trustee.
(f) So long as any of the Notes is outstanding, the Bank will
furnish to the Representative as soon as practicable, (A) all documents
distributed, or caused to be distributed, by the Bank to the Noteholders, (B)
all documents filed, or caused to be filed, by the Bank with respect to the
Trust with the Commission pursuant to the Securities Exchange Act of 1934, as
amended (the "Exchange Act"), and any order of the Commission thereunder or
pursuant to a "no-action" letter from the staff of the Commission and (C) from
time to time, such other information in the possession of the Bank concerning
the Trust and any other information concerning the Bank filed with any
governmental or regulatory authority which is otherwise publicly available, as
the Representative may reasonably request.
(g) On or before the Closing Date, the Bank shall cause its
computer records relating to the Receivables to be marked to show the Trust's
absolute ownership of the Receivables, and from and after the Closing Date
neither the Bank nor the Servicer shall take any action inconsistent with the
Trust's ownership of such Receivables and the security interest of the Indenture
Trustee therein, other than as permitted by the Sale and Servicing Agreement.
(h) To the extent, if any, that the rating provided with
respect to the Notes by Standard & Poor's, Moody's and/or Fitch is conditional
upon the furnishing of documents or the taking of any other actions by the Bank
agreed upon on or prior to the Closing Date, the Bank shall furnish such
documents and take any such other actions.
(i) For the period beginning on the date hereof and ending on
the Closing Date, unless waived by the Representative, neither the Bank nor any
trust originated, directly or indirectly, by the Bank will offer to sell or sell
notes (other than the Notes) collateralized by, or certificates (other than the
Certificates) evidencing an ownership interest in, receivables generated
pursuant to retail automobile or light-duty truck installment sale contracts or
purchase money loans.
6. Payment of Expenses. The Bank will pay all expenses
incident to the performance of its obligations under this Agreement, including
(i) the printing and filing of the Registration Statement as originally filed
and of each amendment thereto, (ii) the Indenture Trustee's and Owner Trustee's
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<PAGE>
acceptance fee and the reasonable fees and disbursements of the counsel to the
Indenture Trustee and counsel to the Owner Trustee, (iii) the fees and
disbursements of __________________ and ________________, (iv) the fees of the
Rating Agencies and (v) blue sky expenses; provided, however, that the
Underwriters may reimburse the Bank for certain expenses incurred by the Bank as
agreed to by the Underwriters and the Bank.
7. Conditions to the Obligations of the Underwriters. The
obligation of the several Underwriters to purchase and pay for the Notes will be
subject to the accuracy of the representations and warranties on the part of the
Bank herein on the date hereof and as of the Closing Date, to the accuracy of
the statements of officers of the Bank made pursuant to the provisions hereof,
to the performance by the Bank of its obligations hereunder and to the following
additional conditions precedent:
(a) On or prior to the date hereof, the Representative
shall have received a letter (a "Procedures Letter"), dated the date of this
Agreement of each of [______________] and [_____________] verifying the
accuracy of such financial and statistical data contained in the Prospectus as
the Representative shall deem reasonably advisable. In addition, if any
amendment or supplement to the Prospectus made after the date hereof contains
financial or statistical data, the Representative shall have received a letter
dated the Closing Date confirming each Procedures Letter and providing
additional comfort on such new data.
(b) The Prospectus Supplement shall have been filed in the
manner and within the time period required by Rule 424(b) of the Rules and
Regulations; and prior to the Closing Date, no stop order suspending the
effectiveness of the Registration Statement shall have been issued and no
proceedings for that purpose shall have been instituted or threatened.
(c) Subsequent to the execution and delivery of this
Agreement, there shall not have occurred (i) any change, or any development
involving a prospective change, in or affecting particularly the business or
properties of the Bank, Chase or The Chase Manhattan Corporation which, in the
reasonable judgment of the Representative, materially impairs the investment
quality of the Notes or makes it impractical to market the Notes; (ii) any
suspension or material limitation of trading in securities generally on the New
York Stock Exchange, or any setting of minimum prices for trading on such
exchange, or any suspension of trading of any securities of the Bank, Chase or
The Chase Manhattan Corporation on any exchange or in the over-
9
<PAGE>
the-counter market by such exchange or over-the-counter market or by the
Commission; (iii) any banking moratorium declared by federal or New York
authorities; or (iv) any outbreak or material escalation of major hostilities or
any other substantial national or international calamity or emergency if, in the
reasonable judgment of the Representative, the effect of any such outbreak,
escalation, calamity or emergency on the United States financial markets makes
it impracticable or inadvisable to proceed with completion of the sale of and
any payment for the Notes.
(d) The Representative shall have received opinions, dated
the Closing Date and reasonably satisfactory, when taken together, in form and
substance to the Representative, of Simpson Thacher & Bartlett, special counsel
to the Bank, [____________________], special counsel to the Trust, and such
other counsel otherwise reasonably acceptable to the Representative, with
respect to such matters as are customary for the type of transaction
contemplated by this Agreement.
(e) The Representative shall have received an opinion or
opinions of Simpson Thacher & Bartlett, special counsel to the Bank, dated the
Closing Date and satisfactory in form and substance to the Representative, with
respect to certain matters relating to the transfers of the Receivables from the
Bank to the Trust and with respect to a grant of a security interest in the
Receivables to the Indenture Trustee, and an opinion of [_____________________],
special counsel to the Trust, with respect to the perfection of the Trust's and
the Indenture Trustee's interests in the Receivables.
(f) The Representative shall have received from Orrick,
Herrington & Sutcliffe LLP, counsel to the Underwriters, such opinion or
opinions, dated the Closing Date and satisfactory in form and substance to the
Representative, with respect to the validity of the Notes, the Registration
Statement, the Prospectus and other related matters as the Representative may
require, and the Bank shall have furnished to such counsel such documents as
they reasonably request for the purpose of enabling them to pass upon such
matters.
(g) The Representative shall have received an opinion of
Simpson Thacher & Bartlett, special tax counsel to the Bank, dated the Closing
Date and reasonably satisfactory in form and substance to the Representative,
with respect to such matters as are customary for the type of transaction
contemplated by this Agreement.
10
<PAGE>
(h) The Representative shall have received an opinion of
[__________________________], counsel to the Indenture Trustee, dated the
Closing Date and satisfactory in form and substance to the Representative, with
respect to such matters as are customary for the transactions contemplated by
this Agreement.
In rendering such opinions, counsel to the Indenture Trustee
may rely on the opinion of the office of the general counsel to the Indenture
Trustee.
(i) The Representative shall have received an opinion of
[___________________________], special counsel to the Owner Trustee, and such
other counsel reasonably satisfactory to the Representative and its counsel,
dated the Closing Date and satisfactory in form and substance to the
Representative, with respect to such matters as are customary for the type of
transaction contemplated by this Agreement;
(j) The Class A-1 Notes shall have been rated "__" by
Standard & Poor's, "__" by Moody's and "___" by Fitch. The Class A-2 Notes,
Class A-3 Notes[,] [and] Class A-4 Notes [and Class [A-5] [B] Notes] shall have
been rated "___" by Standard & Poor's, "__" by Moody's and "___" by Fitch. The
[Certificates] [Class B Notes] shall have been rated "__" by Standard & Poor's,
"__" by Moody's and "___" by Fitch;
(k) The Representative shall have received a certificate,
dated the Closing Date, of an attorney-in-fact, a Vice President or more senior
officer of the Bank in which such person, to the best of his or her knowledge
after reasonable investigation, shall state that (i) the representations and
warranties of the Bank in this Agreement are true and correct in all material
respects on and as of the Closing Date, (ii) the Bank has complied with all
agreements and satisfied all conditions on its part to be performed or satisfied
hereunder at or prior to the Closing Date, (iii) the representations and
warranties of the Bank, as Seller and Servicer, in the Sale and Servicing
Agreement and, as Depositor in the Trust Agreement are true and correct as of
the dates specified in the Sale and Servicing Agreement and the Trust Agreement,
(iv) that no stop order suspending the effectiveness of the Registration
Statement has been issued and no proceedings for that purpose have been
instituted or are threatened by the Commission, (v) that, subsequent to the date
of the Prospectus, there has been no material adverse change in the financial
position or results of operation of the Bank's automotive finance business
11
<PAGE>
except as set forth in or contemplated by the Prospectus or as described in such
certificate and (vi) the Prospectus does not contain any untrue statement of a
material fact or omit to state a material fact required to be stated therein or
necessary in order to make the statements therein, in light of the circumstances
in which they were made, not misleading; and
[(l) On the Closing Date, [$_____________] aggregate
amount of Certificates shall have been issued and sold pursuant to the
Certificate Underwriting Agreement.]
The Bank will furnish the Representative, or cause the
Representative to be furnished, with such number of conformed copies of such
opinions, certificates, letters and documents as the Representative reasonably
requests.
8. Indemnification. (a) The Bank will indemnify and hold
harmless each Underwriter against any losses, claims, damages or liabilities, to
which such Underwriter may become subject, under the Act or otherwise, insofar
as such losses, claims, damages or liabilities (or actions in respect thereof)
arise out of, or are based upon, any untrue statement or alleged untrue
statement of any material fact contained in any preliminary prospectus
supplement, the Registration Statement, the Prospectus (other than any market
making prospectus) or any amendment or supplement thereto, or arise out of, or
are based upon, the omission or alleged omission to state therein a material
fact required to be stated therein or necessary to make the statements therein
not misleading; and will reimburse each Underwriter for any legal or other
expenses reasonably incurred by such Underwriter in connection with
investigating or defending any such action or claim; provided, however, that (i)
the Bank shall not be liable in any such case to the extent that any such loss,
claim, damage or liability arises out of, or is based upon, an untrue statement
or alleged untrue statement or omission or alleged omission made in any
preliminary prospectus supplement, the Registration Statement or the Prospectus
or any such amendment or supplement in reliance upon and in conformity with
written information furnished to the Bank by any Underwriter through the
Representative expressly for use therein and (ii) such indemnity with respect to
any preliminary prospectus supplement shall not inure to the benefit of any
Underwriter (or any person controlling any such Underwriter) from whom the
person asserting any such loss, claim, damage or liability purchased the Notes
which are the subject thereof if such person did not receive a copy of the
Prospectus (or the Prospectus as supplemented) at or prior to the confirmation
of the sale of such Notes to such person in any case where such delivery is
required by the Act and the untrue statement or omission of a material fact
contained in such preliminary prospectus supplement was corrected in the
Prospectus (or the Prospectus as supplemented).
12
<PAGE>
(b) Each Underwriter severally agrees to indemnify and hold
harmless the Bank, its directors, each of its officers or agents who signed the
Registration Statement, and each person, if any, who controls the Bank within
the meaning of Section 15 of the Act against any and all loss, liability, claim,
damage and expense described in the indemnity contained in subsection (a) of
this Section 8, as incurred, but only with respect to untrue statements or
omissions, or alleged untrue statements or omissions, made in any preliminary
prospectus supplement, the Registration Statement or the Prospectus (or any
amendment or supplement thereto) in reliance upon and in conformity with written
information furnished to the Bank by such Underwriter through the Representative
expressly for use in such preliminary prospectus supplement, the Registration
Statement or the Prospectus (or any amendment or supplement thereto).
(c) Each indemnified party shall give prompt notice to the
indemnifying party of any action commenced against the indemnified party in
respect of which indemnity may be sought hereunder, but failure to so notify an
indemnifying party shall not relieve such indemnifying party from any liability
which it may have hereunder or otherwise, other than on account of this
indemnity agreement. In case any such action shall be brought against an
indemnified party and it shall have notified the indemnifying party of the
commencement thereof, the indemnifying party shall be entitled to participate
therein and, to the extent that it shall wish, to assume the defense thereof,
with counsel reasonably satisfactory to such indemnified party (who shall not,
except with the consent of the indemnified party, be counsel to the indemnifying
party with respect to such action), and it being understood that the
indemnifying party shall not, in connection with any one such action or separate
but substantially similar or related actions in the same jurisdiction arising
out of the same general allegations or circumstances, be liable for the
reasonable fees and expenses of more than one separate firm of attorneys, and,
after notice from the indemnifying party to the indemnified party of its
election so to assume the defense thereof, the indemnifying party shall not be
liable to the indemnified party under subsections (a) or (b) of this Section 8
for any legal expenses of other counsel or any other expenses, in each case
subsequently incurred by the indemnified party, in connection with the defense
thereof other than reasonable costs of investigation.
(d) The obligations of the Bank under this Section 8 shall be
in addition to any liability which the Bank may otherwise have and shall extend,
upon the same terms and conditions, to each person, if any, who controls any
Underwriter within the meaning of the Act; and each Underwriter's obligations
under this Section 8 shall be in addition to any liability which such
Underwriter may otherwise have and shall extend, upon the same terms and
conditions, to each officer and director of the Bank and to each person, if any,
who controls the Bank within the meaning of Section 15 of the Act.
13
<PAGE>
9. Contribution. In order to provide for just and equitable
contribution in circumstances in which the indemnity agreement provided for in
Section 8 is for any reason held to be unavailable other than in accordance with
its terms, the Bank and the Underwriters shall contribute to the aggregate
losses, liabilities, claims, damages and expenses of the nature contemplated by
said indemnity agreement incurred by the Bank or the Underwriters, as incurred,
in such proportions so that the Underwriters are responsible for that portion
represented by the percentage that the underwriting discount and commissions
bear to the initial public offering price appearing thereon and the Bank is
responsible for the balance; provided, however, that no person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the Act)
shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation. For purposes of this Section, each person, if any,
who controls an Underwriter within the meaning of Section 15 of the Act shall
have the same rights to contribution as such Underwriter, and each director of
the Bank, each officer or agent of the Bank who signed the Registration
Statement, and each person, if any, who controls the Bank within the meaning of
Section 15 of the Act shall have the same rights to contribution as the Bank.
10. Default of Underwriters. If any Underwriter defaults in
its obligations to purchase Notes hereunder and the aggregate principal amount
of the Notes that such defaulting Underwriter agreed but failed to purchase does
not exceed 10% of the total principal amount of Notes, the Representative may
make arrangements satisfactory to the Bank for the purchase of such Notes by
other persons, including the non-defaulting Underwriters, but if no such
arrangements are made by the Closing Date, the non-defaulting Underwriters shall
be obligated severally, in proportion to their respective commitments hereunder,
to purchase the Notes that such defaulting Underwriter agreed but failed to
purchase. If any Underwriter so defaults and the aggregate principal amount of
the Notes with respect to which such default or defaults occur exceeds 10% of
the total principal amount of the Notes and arrangements satisfactory to the
Representative and the Bank for the purchase of such Notes by other persons are
not made within 36 hours after such default, this Agreement will terminate
without liability on the part of any non-defaulting Underwriter or the Bank,
except as provided in Section 11. Nothing herein will relieve a defaulting
Underwriter from liability for its default.
11. Survival of Certain Representations and Obligations. The
respective indemnities, agreements, representations, warranties and other
statements of the Bank or its officers and of the Underwriters set forth in or
made pursuant to this Agreement will remain in full force and effect, regardless
of any investigation or statement as to the results thereof, made by or on
behalf of the Underwriters, the Bank or any of their respective representatives,
officers or directors or
14
<PAGE>
any controlling person, and will survive delivery of and payment for the Notes.
If for any reason the purchase of the Notes by the Underwriters is not
consummated, the Bank shall remain responsible for the expenses to be paid or
reimbursed by it pursuant to Section 6 and the respective obligations of the
Bank and the Underwriters pursuant to Section 8 and 9 shall remain in effect. If
the purchase of the Notes by the Underwriters is not consummated for any reason
other than solely because of the occurrence of any event specified in clauses
(ii), (iii) or (iv) of Section 7(c), the Bank will reimburse each Underwriter
for all out-of-pocket expenses (including fees and disbursements of counsel)
reasonably incurred by it in connection with the offering of the Notes.
12. Notices. All communications hereunder will be in writing
and, if sent to the Representative or the Underwriters, will be mailed,
delivered or telegraphed and confirmed to the Representative at
________________________, Attention: _________________, or, if sent to the Bank,
will be mailed, delivered, or telegraphed and confirmed to Chase Manhattan Bank
USA, National Association, c/o Chase Manhattan Automotive Finance Corporation,
900 Stewart Avenue, Garden City, New York 11530, Attention: Financial
Controller.
13. Successors. This Agreement will inure to the benefit of,
and be binding upon, the parties hereto and their respective successors. Nothing
expressed or mentioned in this Agreement is intended or shall be construed to
give any person, firm or corporation, other than the parties hereto and their
respective successors and the controlling persons and officers and directors
referred to in Sections 8 and 9 and their heirs and legal representatives, any
legal or equitable right, remedy or claim under or in respect of this Agreement
or any provision herein contained. This Agreement and all conditions and
provisions hereof are intended to be for the sole and exclusive benefit of the
parties hereto and their respective successors, and said controlling persons and
officers and directors and their heirs and legal representatives, and for the
benefit of no other person, firm or corporation. No purchaser of Notes from any
Underwriter shall be deemed to be a successor by reason merely of such purchase.
14. Counterparts. This Agreement may be executed in any
number of counterparts, each of which shall be deemed to be an original, but all
such counterparts shall together constitute one and the same Agreement.
15. No Bankruptcy Petition. Each Underwriter covenants and
agrees that, prior to the date which is one year and one day after the payment
in full of all securities issued by the Trust, it will not institute against, or
join any other person in instituting against, the Trust any bankruptcy,
reorganization, arrangement, insolvency or liquidation
15
<PAGE>
proceedings or other proceedings under any Federal or state bankruptcy or
similar law.
16. APPLICABLE LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.
16
<PAGE>
If the foregoing is in accordance with the Representative's
understanding of our agreement, kindly sign and return to us the enclosed
duplicate hereof, whereupon it will become a binding agreement among the Bank
and the several Underwriters in accordance with its terms.
Very truly yours,
CHASE MANHATTAN BANK USA, NATIONAL ASSOCIATION
By____________________________
Name:
Title:
The foregoing Note
Underwriting Agreement is
hereby confirmed and
accepted as of the date
first written above:
__________________________
on behalf of itself and
as Representative
of the Several Underwriters,
named in Schedule I
By________________________
Name:
Title:
<PAGE>
SCHEDULE I
<TABLE>
<CAPTION>
Principal Amount Principal Amount Principal Amount Principal Amount Principal Amount
of Class A-1 of Class A-2 of Class A-3 of Class A-4 of Class [A-5] [B]
Underwriter Notes Notes Notes Notes Notes
- - - ----------- ----- ----- ----- ----- -----
<S> <C> <C> <C> <C> <C>
-------- -------- -------- -------- --------
Total
</TABLE>
18
<PAGE>
FORM OF CERTIFICATE
UNDERWRITING AGREEMENT
(OWNER TRUST)
CHASE MANHATTAN AUTO OWNER TRUST ____- _
ASSET BACKED CERTIFICATES
CHASE MANHATTAN BANK USA, N.A.
Seller and Servicer
CERTIFICATE UNDERWRITING AGREEMENT
Ladies and Gentlemen:
1. Introductory. Chase Manhattan Bank USA, N.A., a national banking
association (the "Bank"), proposes to form Chase Manhattan Auto Owner Trust
199_-_ (the "Trust") to sell $__________ aggregate principal amount of ______%
Asset Backed Certificates (the "Certificates"), each representing a fractional
undivided interest in the Trust.
The assets of the Trust will include, among other things, a pool of simple
interest retail installment sales contracts and purchase money notes and other
notes (the "Receivables") secured by new and used automobiles (the "Financed
Vehicles") and certain monies received thereunder on and after the Cutoff Date
(as hereinafter defined), such Receivables to be transferred to the Trust and
serviced by the Bank, as Servicer, or by a successor Servicer. The Original Pool
Balance of the Receivables as of the close of business on ___________, ____ (the
"Cut-off Date") was equal to $____________. The Certificates will be issued
pursuant to the Amended and Restated Trust Agreement to be dated as of
___________, ____ (as amended and supplemented from time to time, the
"Trust Agreement"), between the Bank and _________________, as owner
trustee (the "Owner Trustee").
Simultaneously with the issuance and sale of the Certificates as
contemplated herein, the Trust will issue $___________ aggregate principal
amount of Class A-l ___% Money Market Asset Backed Notes (the "Class A-l
Notes"), $___________ aggregate principal amount of Class A-2 _____% Asset
Backed Notes (the "Class A-2 Notes"), $___________ aggregate principal amount of
Class A-3 _____% Asset Backed Notes (the "Class A-3 Notes") $___________
aggregate principal amount of Class A-4 _____% Asset Backed Notes (the "Class
A-4 Notes") and $__________ aggregate principal amount of Class [A-5] [B] _____%
Asset Backed Notes (the "Class [A-5] [B] Notes" and, together with the Class A-l
Notes, the Class A-2 Notes, the Class A-3 Notes, and the Class A-4 Notes, the
"Notes"), pursuant to the Indenture to be dated as of ___________, _____ (as
amended and supplemented from time to
<PAGE>
time, the "Indenture"), between the Trust and ________________________
____________, ____________, as indenture trustee (the "Indenture
Trustee"), which will be sold pursuant to an underwriting agreement
dated the date hereof (the "Note Underwriting Agreement"; together with
this Agreement, the "Underwriting Agreements") among the Bank and the
underwriters named therein (the "Note Underwriters"). The Notes and the
Certificates are sometimes referred to collectively herein as the
"Securities".
Capitalized terms used and not otherwise defined herein shall have the
meanings assigned to such terms in the Sale and Servicing Agreement to be dated
as of ___________, ____ (as amended and supplemented from time to time,
the "Sale and Servicing Agreement"), between the Trust and the Bank, as
Seller and Servicer.
This is to confirm the agreement concerning the purchase of the
Certificates from the Bank by the Underwriter.
2. Representations and Warranties of the Bank. The Bank represents and
warrants to, and agrees with, the Underwriter, that:
(a) A registration statement on Form S-3 (No. 333-____) has been filed with
the Securities and Exchange Commission (the "Commission") in accordance with the
provisions of the Securities Act of 1933, as amended (the "Act"), and the Rules
and Regulations under the Act (the "Rules and Regulations"). Such registration
statement, as amended on the date that such registration statement or the most
recent post-effective amendment thereto became effective under the Act,
including the exhibits thereto, is hereinafter referred to as the "Registration
Statement." The Registration Statement has become effective, and no stop order
suspending the effectiveness of the Registration Statement has been issued, and
no proceeding for that purpose has been instituted or, to the knowledge of the
Bank, threatened by the Commission. The conditions to the use of a registration
statement on Form S-3 under the Act, as set forth in the General Instructions to
Form S-3, and the conditions of Rule 415 under the Rules and Regulations, have
been satisfied with respect to the Registration Statement. The Bank proposes to
file with the Commission pursuant to Rule 424(b) of the Rules and Regulations a
prospectus supplement to the Base Prospectus (as defined herein) relating to the
sale of the Securities (the "Prospectus Supplement"). The base prospectus filed
as part of the Registration Statement, in the form it appears in the
Registration Statement, or in the form most recently revised and filed with the
Commission pursuant to Rule 424(b), is hereinafter referred to as the "Base
Prospectus." The Base Prospectus as supplemented by the Prospectus Supplement is
hereinafter referred to as the "Prospectus;"
(b) Except to the extent that the Underwriter shall have agreed to a
modification, the Prospectus shall be in all substantive respects in the form
furnished to the Underwriter prior to the execution of this Agreement or, to the
extent not
<PAGE>
completed at such time, shall contain only such material changes as the Bank has
advised the Underwriter, prior to such time, will be included or made therein;
(c) The Registration Statement, at the time it became effective, and the
Prospectus, as of the date of the Prospectus Supplement, complied in all
material respects with the applicable requirements of the Act and the Trust
Indenture Act of 1939 and the Rules and Regulations and did not include any
untrue statement of a material fact and, in the case of the Registration
Statement, did not omit to state any material fact required to be stated therein
or necessary to make the statements therein not misleading and, in the case of
the Prospectus, did not omit to state any material fact necessary in order to
make the statements therein, in light of the circumstances under which they were
made, not misleading; on the Closing Date (as defined herein), the Registration
Statement and the Prospectus, as amended or supplemented as of the Closing Date,
will comply in all material respects with the applicable requirements of the Act
and the Rules and Regulations, and neither the Prospectus nor any amendment or
supplement thereto will include any untrue statement of a material fact or omit
to state any material fact necessary in order to make the statements therein, in
light of the circumstances under which they were made, not misleading; provided,
however, that the Bank makes no representation and warranty with respect to
information contained in or omitted from the Registration Statement or the
Prospectus in reliance upon, or in conformity with, information furnished in
writing to the Bank by the Underwriter specifically for use in connection with
the preparation of the Registration Statement or the Prospectus;
(d) The Bank is a national banking association organized under the laws of
the United States, with full power and authority to own its properties and
conduct its business as described in the Prospectus, and had at all relevant
times and has power, authority and legal right to acquire, own, sell and service
the Receivables;
(e) When the Notes have been duly executed and delivered by the Owner
Trustee and, when authenticated by the Indenture Trustee in accordance with the
Indenture and delivered upon the order of the Bank to the Note Underwriters
pursuant to the Note Underwriting Agreement and the Sale and Servicing
Agreement, the Notes will be duly issued and will constitute legal, valid and
binding obligations of the Trust enforceable against the Trust in accordance
with their terms, except to the extent that the enforceability thereof may be
subject to bankruptcy, insolvency, reorganization, conservatorship, moratorium
or other similar laws now or hereafter in effect relating to creditors' rights
as such laws would apply in the event of the insolvency, liquidation or
reorganization or other similar occurrence with respect to the Bank or the Trust
or in the event of any moratorium or similar occurrence affecting the Bank or
the Trust and to general principles of equity;
(f) The direction by the Bank to the Owner Trustee to execute and
authenticate the Certificates has been duly
<PAGE>
authorized by the Bank and, when the Certificates have been duly executed,
authenticated and delivered by the Owner Trustee in accordance with the Trust
Agreement and delivered upon the order of the Bank to the Underwriter pursuant
to this Agreement and the Sale and Servicing Agreement, the Certificates will be
duly issued and entitled to the benefits and security afforded by the Trust
Agreement;
(g) The execution, delivery and performance by the Bank of this Agreement,
the Note Underwriting Agreement, and the Basic Documents to which the Bank is a
party, and the consummation by the Bank of the transactions provided for herein
and therein have been, or will have been, duly authorized by the Bank by all
necessary action on the part of the Bank; and neither the execution and delivery
by the Bank of such instruments, nor the performance by the Bank of the
transactions herein or therein contemplated, nor the compliance by the Bank with
the provisions hereof or thereof, will (i) conflict with or result in a breach
or violation of any of the material terms and provisions of, or constitute a
material default under, any of the provisions of the articles of association or
by-laws of the Bank, or (ii) conflict with any of the provisions of any law,
governmental rule, regulation, judgment, decree or order binding on the Bank or
its properties, or (iii) conflict with any of the material provisions of any
material indenture, mortgage, contract or other instrument to which the Bank is
a party or by which it is bound, or (iv) result in the creation or imposition of
any lien, charge or encumbrance upon any of its property pursuant to the terms
of any such indenture, mortgage, contract or other instruments, except, in the
case of clauses (ii) and (iii), for any such breaches or conflicts as would not
individually or in the aggregate have a material adverse effect on the
transactions contemplated hereby or on the ability of the Bank to consummate
such transactions;
(h) When executed and delivered by the parties thereto, each of the Sale
and Servicing Agreement and the Trust Agreement will constitute a legal, valid
and binding obligation of the Bank, enforceable against the Bank in accordance
with its terms, except to the extent that the enforceability thereof may be
subject to bankruptcy, insolvency, reorganization, conservatorship, moratorium
or other similar laws now or hereafter in effect relating to creditors' rights
as such laws would apply in the event of the insolvency, liquidation or
reorganization or other similar occurrence with respect to the Bank or in the
event of any moratorium or similar occurrence affecting the Bank and to general
principles of equity;
(i) All approvals, authorizations, consents, orders or other actions of any
person, corporation or other organization, or of any court, governmental agency
or body or official (except with respect to the state securities or "blue sky"
laws of various jurisdictions), if so required in connection with the
execution, delivery and performance of this Agreement, the Note Underwriting
Agreement and the Basic Documents to which the Bank is a party has been or will
be taken or obtained on or prior to the Closing Date;
<PAGE>
(j) As of the Closing Date, the representations and warranties of the Bank,
as Seller and Servicer, in the Trust Agreement will be true and correct;
(k) This Agreement has been duly executed and delivered by the Bank;
3. Purchase, Sale, Payment and Delivery of the Certificates. On the basis
of the representations, warranties and agreements herein contained, but subject
to the terms and conditions herein set forth, the Bank agrees to sell to the
Underwriter, and the Underwriter agrees, to purchase from the Bank, at a
purchase price of ___________% of the face amount thereof, the Certificates plus
accrued interest at the Certificate Rate from _____ _____, _____ to but
excluding the Closing Date.
The Bank will deliver the Certificates to the Underwriter against payment
of the purchase price in immediately available funds drawn to the order of the
Bank at the offices of Orrick, Herrington & Sutcliffe LLP in New York, New York
at 10:00 a.m., New York City time, on ______ _________, ____ or at such other
time not later than seven full business days thereafter as the Underwriter and
the Bank determine, such time being herein referred to as the "Closing Date."
The Certificates to be so delivered will be initially represented by one or more
definitive Certificates registered in the name of Cede & Co., the nominee of The
Depository Trust Company ("DTC"), except for a Certificate registered in the
name of Chase Securities Inc. in an amount of $_______, and will be made
available for inspection by the Underwriter at the office where delivery and
payment for such Certificates is to take place no later than 1:00 p.m., New York
City time, on the Business Day prior to the Closing Date.
4. Offering by the Underwriter. It is understood that the Underwriter
proposes to offer the Certificates for sale to the public (which may include
selected brokers and dealers) as set forth in the Prospectus.
5. Covenants of the Bank. The Bank covenants and agrees with the
Underwriter that:
a) The Bank will file the Prospectus with the Commission pursuant to Rule
424(b) of the Rules and Regulations within the time prescribed therein and will
provide evidence satisfactory to the Underwriter of such timely filing. During
any period that a prospectus relating to the Certificates is required under the
Act to be delivered to purchasers of the Certificates by the underwriters and
dealers participating in the initial offering and sale of the Certificates on
the Closing Date under the Act (without regard to any market making prospectus
required to be delivered by the Underwriter pursuant to the Act) (a "prospectus
delivery period"), the Bank will not file any amendments to the Registration
Statement, or any amendments or supplements to the Prospectus, unless it shall
first have delivered copies of such amendments or supplements to the
Underwriter, and, if the Underwriter shall have reasonably
<PAGE>
objected thereto promptly after receipt thereof; the Bank will promptly advise
the Underwriter or its counsel (i) when notice is received from the Commission
that any post-effective amendment to the Registration Statement has become or
will become effective, (ii) of any request by the Commission for any amendment
or supplement to the Registration Statement or the Prospectus or for any
additional information and (iii) of any order or communication suspending or
preventing, or threatening to suspend or prevent, the offer and sale of the
Certificates or of any proceedings or examinations that may lead to such an
order or communication, whether by or of the Commission or any authority
administering any state securities or "blue sky" law, as soon as the Bank is
advised thereof, and will use its reasonable efforts to prevent the issuance of
any such order or communication and to obtain as soon as possible its lifting,
if issued.
(b) If, at any time during the prospectus delivery period, any event occurs
as a result of which the Prospectus as then amended or supplemented would
include an untrue statement of a material fact or omit to state any material
fact necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading, or if it is necessary
at any time to amend the Prospectus in order to comply with the Act or the Rules
and Regulations, the Bank promptly will prepare and file with the Commission
(subject to the Underwriter's prior review pursuant to paragraph (a) of this
Section 5), an amendment or supplement which will correct such statement or
omission or an amendment or supplement which will effect such compliance.
(c) The Bank will furnish to the Underwriter copies of the Registration
Statement, each preliminary prospectus supplement relating to the Certificates,
the Prospectus, and all amendments and supplements to such documents, in each
case as soon as available and in such quantities as the Underwriter may
reasonably request.
(d) The Bank will cooperate with the Underwriter in arranging for the
qualification of the Certificates for sale and the determination of their
eligibility for investment under the laws of such jurisdictions as the
Underwriter designates and will cooperate in continuing such qualifications in
effect so long as required for the distribution of the Certificates; provided,
however, that neither the Bank nor the Trust shall be obligated to qualify to do
business in any jurisdiction in which it is not currently so qualified or to
take any action which would subject it to general or unlimited service of
process in any jurisdiction where it is not now so subject.
(e) For a period from the date of this Agreement until the retirement of
the Certificates, the Bank, as Servicer, will furnish to the Underwriter copies
of each certificate and the annual statements of compliance delivered to
independent certified public accountants' and reports furnished to the Indenture
Trustee or the Owner Trustee pursuant to the Sale and Servicing Agreement, as
soon as practicable after such statements
<PAGE>
and reports are furnished to the Indenture Trustee or the Owner Trustee.
(f) So long as any of the Certificates is outstanding, the Bank will
furnish to the Underwriter as soon as practicable, (A) all documents
distributed, or caused to be distributed, by the Bank to the Certificateholders,
(B) all documents filed, or caused to be filed, by the Bank with respect to the
Trust with the Commission pursuant to the Securities Exchange Act of 1934, as
amended (the "Exchange Act"), and any order of the Commission thereunder or
pursuant to a "no-action" letter from the staff of the Commission and (C) from
time to time, such other information in the possession of the Bank concerning
the Trust and any other information concerning the Bank filed with any
governmental or regulatory authority which is otherwise publicly available, as
the Underwriter may reasonably request.
(g) On or before the Closing Date, the Bank shall cause its computer
records relating to the Receivables to be marked to show the Trust's absolute
ownership of the Receivables, and from and after the Closing Date neither the
Bank nor the Servicer shall take any action inconsistent with the Trust's
ownership of such Receivables and the security interest of the Indenture Trustee
therein, other than as permitted by the Sale and Servicing Agreement.
(h) To the extent, if any, that the rating provided with respect to the
Certificates by Moody's, Standard & Poor's and/or Fitch is conditional upon the
furnishing of documents or the taking of any other actions by the Bank agreed
upon on or prior to the Closing Date, the Bank shall furnish such documents and
take any such other actions.
(i) For the period beginning on the date hereof and ending on the Closing
Date, unless waived by the Underwriter, neither the Bank nor any trust
originated, directly or indirectly, by the Bank will offer to sell or sell notes
(other than the Notes) collateralized by, or certificates (other than the
Certificates) evidencing an ownership interest in, receivables generated
pursuant to retail automobile or light duty truck installment sale contracts or
purchase money loans.
6. Payment of Expenses. The Bank will pay all expenses incident to the
performance of its obligations under this Agreement, including (i) the printing
and filing of the Registration Statement as originally filed and of each
amendment thereto, (ii) the Indenture Trustee's and Owner Trustee's acceptance
fee and the reasonable fees and disbursements of the counsel to the Indenture
Trustee and counsel to the Owner Trustee, (iii) the fees and disbursements of
_______________ and _____________________, (iv) the fees of the Rating Agencies
and (v) blue sky expenses; provided, however, that the Underwriter may reimburse
the Bank for certain expenses incurred by the Bank as agreed to by the
Underwriter and the Bank.
7. Conditions to the Obligations of the Underwriter. The obligation of the
Underwriter to purchase and pay for the
<PAGE>
Certificates will be subject to the accuracy of the representations and
warranties on the part of the Bank herein on the date hereof and as of the
Closing Date, to the accuracy of the statements of officers of the Bank made
pursuant to the provisions hereof, to the performance by the Bank of its
obligations hereunder and to the following additional conditions precedent:
(a) On or prior to the date hereof the Underwriter
shall have received a letter (a "Procedures Letter"), dated
the date of this Agreement of each of __________________ and
__________________ verifying the accuracy of such financial
and statistical data contained in the Prospectus as the
Underwriter shall deem reasonably advisable. In addition, if
any amendment or supplement to the Prospectus made after the
date hereof contains financial or statistical data, the
Underwriter shall have received a letter dated the Closing
Date confirming each Procedures Letter and providing
additional comfort on such new data;
(b) The Prospectus Supplement shall have been filed
in the manner and within the time period required by Rule
424(b) of the Rules and Regulations; and prior to the Closing
Date, no stop order suspending the effectiveness of the
Registration Statement shall have been issued and no
proceedings for that purpose shall have been instituted or
threatened;
(c) Subsequent to the execution and delivery of
this Agreement, there shall not have occurred (i) any change,
or any development involving a prospective change, in or
affecting particularly the business or properties of the Bank,
Chase or The Chase Manhattan Corporation which, in the
reasonable judgment of the Underwriter, materially impairs the
investment quality of the Certificates or makes it impractical
to market the Certificates; (ii) any suspension or material
limitation of trading in securities generally on the New York
Stock Exchange, or any setting of minimum prices for trading
on such exchange, or any suspension of trading of any
securities of the Bank, Chase or The Chase Manhattan
Corporation on any exchange or in the over-the-counter market
by such exchange or by the Commission; (iii) any banking
moratorium declared by Federal or New York authorities; or
(iv) any outbreak or material escalation of major hostilities
or any other substantial national or international calamity or
emergency if, in the reasonable judgment of the Underwriter,
the effect of any such outbreak, escalation, calamity or
emergency on the United States financial markets makes it
impracticable or inadvisable to proceed with completion of the
sale of and any payment for the Certificates;
(d) The Underwriter shall have received opinions,
dated the Closing Date and reasonably satisfactory,
<PAGE>
when taken together, in form and substance to the Underwriter,
of Simpson Thacher & Bartlett, special counsel to the Bank,
__________________ , special counsel to the Trust, and such
other counsel otherwise reasonably acceptable to the
Underwriter, with respect to such matters as are customary for
the type of transaction contemplated by this Agreement;
(e) The Underwriter shall have received an opinion
or opinions of Simpson Thacher & Bartlett, special counsel to
the Bank, dated the Closing Date and satisfactory in form and
substance to the Underwriter, with respect to certain matters
relating to the transfers of the Receivables from the Bank to
the Trust and with respect to a grant of a security interest
in the Receivables to the Indenture Trustee, and an opinion of
___________________, Special Counsel to the Trust, with
respect to the perfection of the Trust's and the Indenture
Trustee's interests in the Receivables;
(f) The Underwriter shall have received from
Orrick, Herrington & Sutcliffe LLP, counsel to the
Underwriter, such opinion or opinions, dated the Closing Date
and satisfactory in form and substance to the Underwriter,
with respect to the validity of the Certificates, the
Registration Statement, the Prospectus and other related
matters as the Underwriter may require, and the Bank shall
have furnished to such counsel such documents as they
reasonably request for the purpose of enabling them to pass
upon such matters;
(g) The Underwriter shall have received an opinion
of Simpson Thacher & Bartlett, special tax counsel to the
Bank, dated the Closing Date and reasonably satisfactory in
form and substance to the Underwriter, with respect to such
matters as are customary for the type of transaction
contemplated by this Agreement;
(h) The Underwriter shall have received an opinion
of counsel to the Indenture Trustee, dated the Closing Date
and satisfactory in form and substance to the Underwriter with
respect to such matters as are customary for the transactions
contemplated by this Agreement;
In rendering such opinions, counsel to the Indenture Trustee
may rely on the opinion of the office of the general counsel to the Indenture
Trustee.
(i) The Underwriter shall have received an opinion
of counsel to the Owner Trustee, and such other counsel
reasonably satisfactory to the Underwriter and its counsel,
dated the Closing Date and satisfactory in form and substance
to the Underwriter, with respect to
<PAGE>
such matters as are customary for the type of transaction
contemplated by this Agreement;
(j) The Certificates have been rated "___" by
[Standard & Poor's], "____" by [Moody's] and "____" by
[Fitch];
(k) The Underwriter shall have received a
certificate, dated the Closing Date, of an attorney-in-fact, a
Vice President or more senior officer of the Bank in which
such person, to the best of his or her knowledge after
reasonable investigation, shall state that (i) the
representations and warranties of the Bank in this Agreement
are true and correct in all material respects on and as of the
Closing Date, (ii) that the Bank has complied with all
agreements and satisfied all conditions on its part to be
performed or satisfied hereunder at or prior to the Closing
Date, (iii) the representations and warranties of the Bank, as
Seller and Servicer, in the Sale and Servicing Agreement and,
as Depositor, in the Trust Agreement, are true and correct as
of the dates specified in the Sale and Servicing Agreement and
the Trust Agreement, (iv) that no stop order suspending the
effectiveness of the Registration Statement has been issued
and no proceedings for that purpose have been instituted or
are threatened by the Commission, (v) that, subsequent to the
date of the Prospectus, there has been no material adverse
change in the financial position or results of operation of
the Bank's automotive finance business except as set forth in
or contemplated by the Prospectus or as described in such
certificate and (vi) the Prospectus does not contain any
untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary in
order to make the statements therein, in light of the
circumstances in which they were made, not misleading;
(1) On the Closing Date, all of the Notes shall
have been issued and sold pursuant to the Note Underwriting
Agreement; and
(m) The Class A-1 Notes shall have been rated
"____" by [Standard & Poor's], "____" by [Moody's] and
"____" by [Fitch], and the Class A-2 Notes, Class A-3
Notes, Class A-4 Notes and Class [A-5] [B] Notes shall
have been rated "____" by [Standard & Poor's], "____" by
[Moody's] and "____" by [Fitch].
The Bank will furnish the Underwriter, or cause the
Underwriter to be furnished, with such number of conformed copies of such
opinions, certificates, letters and documents as the Underwriter reasonably
requests.
8. Indemnification. (a) The Bank will indemnify and hold
harmless the Underwriter against any losses, claims, damages or liabilities, to
which the Underwriter may become subject,
<PAGE>
under the Act or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of, or are based upon, any
untrue statement or alleged untrue statement of any material fact contained in
any preliminary prospectus supplement, the Registration Statement) , the
Prospectus (other than any market making prospectus) or any amendment or
supplement thereto, or arise out of, or are based upon, the omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading; and will reimburse the
Underwriter for any legal or other expenses reasonably incurred by the
Underwriter in connection with investigating or defending any such action or
claim; provided, however, that (i) the Bank shall not be liable in any such case
to the extent that any such loss, claim, damage or liability arises out of, or
is based upon, an untrue statement or alleged untrue statement or omission or
alleged omission made in any preliminary prospectus supplement, the Registration
Statement or the Prospectus or any such amendment or supplement in reliance upon
and in conformity with written information furnished to the Bank by the
Underwriter expressly for use therein and (ii) such indemnity with respect to
any preliminary prospectus supplement shall not inure to the benefit of the
Underwriter (or any person controlling any the Underwriter) from whom the person
asserting any such loss, claim, damage or liability purchased the Certificates
which are the subject thereof if such person did not receive a copy of the
Prospectus (or the Prospectus as supplemented) at or prior to the confirmation
of the sale of such Certificates to such person in any case where such delivery
is required by the Act and the untrue statement or omission of a material fact
contained in such preliminary prospectus supplement was corrected in the
Prospectus (or the Prospectus as supplemented).
(b) The Underwriter agrees to indemnify and hold harmless the Bank, its
directors, each of its officers or agents who signed the Registration Statement,
and each person, if any, who controls the Bank within the meaning of Section 15
of the Act against any and all loss, liability, claim, damage and expense
described in the indemnity contained in subsection (a) of this Section 8, as
incurred, but only with respect to untrue statements or omissions, or alleged
untrue statements or omissions, made in any preliminary prospectus supplement,
the Registration Statement or the Prospectus (or any amendment or supplement
thereto) in reliance upon and in conformity with written information furnished
to the Bank by the Underwriter expressly for use in such preliminary prospectus
supplement, the Registration Statement or the Prospectus (or any amendment or
supplement thereto).
(c) Each indemnified party shall give prompt notice to the indemnifying
party of any action commenced against the indemnified party in respect of which
indemnity may be sought hereunder, but failure to so notify an indemnifying
party shall not relieve such indemnifying party from any liability which it may
have hereunder or otherwise, other than on account of this indemnity agreement.
In case any such action shall be brought against an indemnified party and it
shall have notified the
<PAGE>
indemnifying party of the commencement thereof, the indemnifying party shall be
entitled to participate therein and, to the extent that it shall wish, to assume
the defense thereof, with counsel reasonably satisfactory to such indemnified
party (who shall not, except with the consent of the indemnified party, be
counsel to the indemnifying party with respect to such action), and it being
understood that the indemnifying party shall not, in connection with any one
such action or separate but substantially similar or related actions in the same
jurisdiction arising out of the same general allegations or circumstances, be
liable for the reasonable fees and expenses of more than one separate firm of
attorneys, and, after notice from the indemnifying party to the indemnified
party of its election so to assume the defense thereof, the indemnifying party
shall not be liable to the indemnified party under subsections (a) or (b) of
this Section 8 for any legal expenses of other counsel or any other expenses, in
each case subsequently incurred by the indemnified party, in connection with the
defense thereof other than reasonable costs of investigation.
(d) The obligations of the Bank under this Section 8 shall be in addition
to any liability which the Bank may otherwise have and shall extend, upon the
same terms and conditions, to each person, if any, who controls the Underwriter
within the meaning of the Act; and the Underwriter's obligations under this
Section 8 shall be in addition to any liability which the Underwriter may
otherwise have and shall extend, upon the same terms and conditions, to each
officer and director of the Bank and to each person, if any, who controls the
Bank within the meaning of Section 15 of the Act.
9. Contribution. In order to provide for just and equitable contribution in
circumstances in which the indemnity agreement provided for in Section 8 is for
any reason held to be unavailable other than in accordance with its terms, the
Bank and the Underwriter shall contribute to the aggregate losses, liabilities,
claims, damages and expenses of the nature contemplated by said indemnity
agreement incurred by the Bank or the Underwriter, as incurred, in such
proportions so that the Underwriter is responsible for that portion represented
by the percentage that the underwriting discount and commissions bear to the
initial public offering price appearing thereon and the Bank is responsible for
the balance; provided, however, that no person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Act) shall be
entitled to contribution from any person who was not guilty of such fraudulent
misrepresentation. For purposes of this Section, each person, if any, who
controls the Underwriter within the meaning of Section 15 of the Act shall have
the same rights to contribution as the Underwriter, and each director of the
Bank, each officer or agent of the Bank who signed the Registration Statement,
and each person, if any, who controls the Bank within the meaning of Section 15
of the Act shall have the same rights to contribution as the Bank.
10. Survival of Certain Representations and Obligations. The respective
indemnities, agreements,
<PAGE>
representations, warranties and other statements of the Bank or its officers and
of the Underwriter set forth in or made pursuant to this Agreement will remain
in full force and effect, regardless of any investigation or statement as to the
results thereof, made by or on behalf of the Underwriter, the Bank or any of
their respective representatives, officers or directors or any controlling
person, and will survive delivery of and payment for the Certificates. If for
any reason the purchase of the Certificates by the Underwriter is not
consummated, the Bank shall remain responsible for the expenses to be paid or
reimbursed by it pursuant to Section 6 and the respective obligations of the
Bank and the Underwriter pursuant to Section 5, 6, 8 and 9 shall remain in
effect. If the purchase of the Certificates by the Underwriter is not
consummated for any reason other than solely because of the occurrence of any
event specified in clauses (ii), (iii) or (iv) of Section 7(c), the Bank will
reimburse the Underwriter for all out of-pocket expenses (including fees and
disbursements of counsel) reasonably incurred by it in connection with the
offering of the Certificates.
11. Notices. All communications hereunder will be in writing and, if sent
to the Underwriter, will be mailed, delivered or telegraphed and confirmed to
the Underwriter at Chase Securities Inc., 270 Park Avenue, 7th Floor, New York,
New York 10017, Attention: Asset Backed Finance Division, or, if sent to the
Bank, will be mailed, delivered, or telegraphed and confirmed to Chase Manhattan
Bank USA, National Association c/o Chase Manhattan Automotive Finance
Corporation, 900 Stewart Avenue, Garden City, New York, New York 11530,
Attention: Financial Controller.
12. Successors. This Agreement will inure to the benefit of, and be binding
upon, the parties hereto and their respective successors. Nothing expressed or
mentioned in this Agreement is intended or shall be construed to give any
person, firm or corporation, other than the parties hereto and their respective
successors and the controlling persons and officers and directors referred to in
Sections 8 and 9 and their heirs and legal representatives, any legal or
equitable right, remedy or claim under or in respect of this Agreement or any
provision herein contained. This Agreement and all conditions and provisions
hereof are intended to be for the sole and exclusive benefit of the parties
hereto and their respective successors, and said controlling persons and
officers and directors and their heirs and legal representatives, and for the
benefit of no other person, firm or corporation. No purchaser of Certificates
from the Underwriter shall be deemed to be a successor by reason merely of such
purchase.
13. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original, but all such
counterparts shall together constitute one and the same
Agreement.
14. No Bankruptcy Petition. The Underwriter covenants and agrees that,
prior to the date which is one year and one day after the payment in full of all
securities issued by the Trust,
<PAGE>
it will not institute against, or join any other person in instituting against,
the Trust any bankruptcy, reorganization, arrangement, insolvency or liquidation
proceedings or other proceedings under any federal or state bankruptcy or
similar law.
15. APPLICABLE LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED AND
INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.
<PAGE>
If the foregoing is in accordance with the Underwriter's understanding of
our agreement, kindly sign and return to us the enclosed duplicate hereof,
whereupon it will become a binding agreement between the Bank and the
Underwriter in accordance with its terms.
Very truly yours,
CHASE MANHATTAN BANK USA, NATIONAL ASSOCIATION
By _____________________________
Name:
Title:
The foregoing
Underwriting Agreement is
hereby confirmed and
accepted as of the date
first written above:
By ____________________________
Name:
Title:
<PAGE>
FORM OF POOLING AND
SERVICING AGREEMENT
(GRANTOR TRUST)
================================================================================
CHASE MANHATTAN BANK USA, N.A.,
as Seller and Servicer
and
[---------------------------------------]
as Trustee
on behalf of the Certificateholders
and as Collateral Agent
===============================
POOLING AND SERVICING AGREEMENT
Dated as of __________ __, 199_
===============================
$------------------------
Chase Manhattan Auto Grantor Trust 199_-_
_____% Automobile Loan Pass-Through Certificates, Class A
_____% Automobile Loan Pass-Through Certificates, Class B
================================================================================
<PAGE>
TABLE OF CONTENTS
<TABLE>
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ARTICLE I
DEFINITIONS
<S> <C>
SECTION 1.1. Definitions....................................................................................... 1
SECTION 1.2. Usage of Terms.................................................................................... 18
[SECTION 1.3. [Simple Interest Method]; Allocations............................................................ 19
ARTICLE II
THE TRUST CONVEYANCE OF THE RECEIVABLES
SECTION 2.1. Creation of the Trust............................................................................. 20
SECTION 2.2. Conveyance of Receivables......................................................................... 20
ARTICLE III
THE RECEIVABLES
SECTION 3.1. Representations and Warranties of Seller;
Conditions Relating to Receivables............................................................ 22
SECTION 3.2. Repurchase Upon Breach or Failure of a
Condition..................................................................................... 27
SECTION 3.3. Custody of Receivable Files....................................................................... 27
SECTION 3.4. Duties of Servicer as Custodian................................................................... 28
SECTION 3.5. Instructions; Authority to Act.................................................................... 29
SECTION 3.6. Custodian's Indemnification....................................................................... 29
SECTION 3.7. Effective Period and Termination.................................................................. 29
ARTICLE IV
ADMINISTRATION AND SERVICING OF RECEIVABLES
SECTION 4.1. Duties of Servicer................................................................................ 31
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i
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SECTION 4.2. Collection of Receivable Payments;
Refinancing................................................................................... 31
SECTION 4.3. Realization Upon Receivables...................................................................... 32
SECTION 4.4. Non-Credit Related Extensions to Obligors......................................................... 33
SECTION 4.5. Maintenance of Security Interests in
Financed Vehicles............................................................................. 34
SECTION 4.6. Covenants of Servicer............................................................................. 35
SECTION 4.7. Purchase of Receivables Upon Breach............................................................... 36
SECTION 4.8. Servicing Fee..................................................................................... 36
SECTION 4.9. Servicer's Certificate............................................................................ 37
SECTION 4.10. Annual Statement as to Compliance................................................................ 37
SECTION 4.11. Annual Audit Report.............................................................................. 38
SECTION 4.12. Access by Certificateholders to Certain
Documentation and Information Regarding
Receivables...................................................................................... 39
SECTION 4.13. Reports to Certificateholders and the
Rating Agencies.............................................................................. 39
SECTION 4.14. Reports to the Securities and Exchange
Commission................................................................................... 40
ARTICLE V
ACCOUNTS; DISTRIBUTIONS; STATEMENTS TO
CERTIFICATEHOLDERS
SECTION 5.1. Establishment of the Accounts..................................................................... 41
SECTION 5.2. Collections....................................................................................... 42
SECTION 5.3. Advances.......................................................................................... 42
SECTION 5.4. Additional Deposits............................................................................... 43
SECTION 5.5. Distributions..................................................................................... 44
SECTION 5.6. Reserve Account; Assignment of Retained
Yield to Collateral Agent..................................................................... 45
SECTION 5.7. Net Deposits...................................................................................... 48
</TABLE>
ii
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SECTION 5.8. Statements to Certificateholders................................................................. 48
ARTICLE VI
THE CERTIFICATES
SECTION 6.1. The Certificates................................................................................. 50
SECTION 6.2. Execution, Authentication and Delivery of
Certificates................................................................................. 50
SECTION 6.3. Registration of Transfer and Exchange of
Certificates................................................................................. 51
SECTION 6.4. Mutilated, Destroyed, Lost, or Stolen
Certificates................................................................................. 53
SECTION 6.5. Persons Deemed Owners............................................................................ 53
SECTION 6.6. Access to List of Certificateholders' Names
and Addresses................................................................................ 53
SECTION 6.7. Maintenance of Office or Agency.................................................................. 54
SECTION 6.8. Book-Entry Certificates.......................................................................... 54
SECTION 6.9. Notices to Clearing Agency....................................................................... 55
SECTION 6.10. Definitive Certificates.......................................................................... 55
SECTION 6.11. Appointment of Paying Agent...................................................................... 56
SECTION 6.12. Authenticating Agent............................................................................. 57
SECTION 6.13. Actions of Certificateholders.................................................................... 59
ARTICLE VII
THE SELLER
SECTION 7.1. Representations of Seller........................................................................ 60
SECTION 7.2. Liability of Seller; Indemnities................................................................. 61
SECTION 7.3. Merger or Consolidation of Seller................................................................ 62
SECTION 7.4. Limitation on Liability of Seller and
Others....................................................................................... 62
SECTION 7.5. Seller May Own Certificates...................................................................... 62
</TABLE>
iii
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<CAPTION>
ARTICLE VIII
THE SERVICER
Section Page
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<S> <C>
SECTION 8.1. Representations of Servicer...................................................................... 63
SECTION 8.2. Liability of Servicer; Indemnities............................................................... 64
SECTION 8.3. Merger or Consolidation of Servicer.............................................................. 65
SECTION 8.4. Limitation on Liability of Servicer and
Others....................................................................................... 65
SECTION 8.5. Servicer Not To Resign........................................................................... 67
SECTION 8.6. Delegation of Duties............................................................................. 67
ARTICLE IX
DEFAULT
SECTION 9.1. Events of Servicing Termination.................................................................. 68
SECTION 9.2. Trustee to Act; Appointment of Successor......................................................... 69
SECTION 9.3. Notification to Certificateholders............................................................... 70
SECTION 9.4. Waiver of Past Defaults.......................................................................... 70
ARTICLE X
THE TRUSTEE
SECTION 10.1. Duties of Trustee................................................................................ 72
SECTION 10.2. Trustee's Assignment of Repurchased
Receivables and Trustee's Certificate........................................................ 74
SECTION 10.3. Certain Matters Affecting the Trustee............................................................ 74
SECTION 10.4. Trustee Not Liable for Certificates or
Receivables.................................................................................. 75
SECTION 10.5. Trustee May Own Certificates..................................................................... 77
SECTION 10.6. Trustee's Fees and Expenses...................................................................... 77
SECTION 10.7. Indemnity of Trustee............................................................................. 77
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iv
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SECTION 10.8. Eligibility Requirements for Trustee............................................................. 78
SECTION 10.9. Resignation or Removal of Trustee................................................................ 78
SECTION 10.10. Successor Trustee................................................................................ 79
SECTION 10.11. Merger or Consolidation of Trustee............................................................... 79
SECTION 10.12. Appointment of Co-Trustee or Separate
Trustee...................................................................................... 80
SECTION 10.13. Representations and Warranties of
Trustee...................................................................................... 81
SECTION 10.14. Tax Returns...................................................................................... 82
SECTION 10.15. Trustee May Enforce Claims Without
Possession of Certificates.................................................................... 82
SECTION 10.16. Suits for Enforcement............................................................................ 83
SECTION 10.17. Maintenance of Office or Agency.................................................................. 83
SECTION 10.18 [_____________________________
__________], as Collateral Agent............................................................. 83
ARTICLE XI
TERMINATION
SECTION 11.1. Termination of the Trust......................................................................... 84
SECTION 11.2. Optional Purchase of All Receivables............................................................. 85
ARTICLE XII
MISCELLANEOUS PROVISIONS
SECTION 12.1. Amendment........................................................................................ 86
SECTION 12.2. Protection of Title to Trust..................................................................... 87
SECTION 12.3. Limitation on Rights of
Certificateholders........................................................................... 89
SECTION 12.4. GOVERNING LAW.................................................................................... 90
SECTION 12.5. Notices.......................................................................................... 90
SECTION 12.6. Severability of Provisions....................................................................... 91
</TABLE>
v
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<TABLE>
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SECTION 12.7. Assignment; References to Chase USA.............................................................. 91
SECTION 12.8. Certificates Nonassessable and Fully Paid........................................................ 91
SECTION 12.9. Third-Party Beneficiaries........................................................................ 92
SECTION 12.10. Counterparts..................................................................................... 92
SECTION 12.11. Tax Matters...................................................................................... 92
SCHEDULES
Schedule A - List of Receivables
Schedule B - Location of Receivables
EXHIBITS
Exhibit A-1 - Form of Class A Certificate
Exhibit A-2 - Form of Class B Certificate
Exhibit B - Form of Depositary Receipt Agreement
Exhibit C-1 - Trustee's Certificate pursuant to Section
11.2 (assignment to Seller)
Exhibit C-2 - Trustee's Certificate pursuant to Section
11.2 (assignment to Servicer)
Exhibit D - Form of Servicer's Certificate
Exhibit E - Form of Certificateholder Report
</TABLE>
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This Pooling and Servicing Agreement, dated as of __________
__, 199_ (as amended, supplemented or otherwise modified and in effect from time
to time, this "Agreement") is made with respect to the formation of the Chase
Manhattan Auto Grantor Trust 199_-_ (the "Trust"), between CHASE MANHATTAN BANK
USA, N.A., a national banking association ("Chase USA" and the "Seller" and the
"Servicer" in its respective capacities as such), and [_______________________],
a national banking association, as trustee (in such capacity, the "Trustee")
and as collateral agent with respect to the Reserve Account and the Retained
Yield (in such capacity, the "Collateral Agent").
W I T N E S S E T H :
In consideration of the premises and of the mutual agreements
herein contained, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS
SECTION 1.1. Definitions. Whenever used in this Agreement,
the following words and phrases, unless the context otherwise requires, shall
have the following meanings:
"Accounts" mean, collectively, the Collection Account and
the Distribution Accounts.
"Accrued Interest" on a Receivable, as of any date of
determination, means that amount of interest accrued on the Principal Balance at
the APR but not paid by or on behalf of the Obligor.
"Advance" as of a Record Date means any payment made by the
Servicer pursuant to Section 5.3.
"Affiliate" means, with respect to any specified Person, any
other Person controlling or controlled by or under common control with such
specified Person. For purposes of this definition, "control" when used with
respect to any specified Person means the power to direct the management and
policies of such Person, directly or indirectly, whether through the ownership
of voting securities, by contract or otherwise; and the terms "controlling" and
"controlled" have meanings correlative to the foregoing. A Person shall not be
deemed to be an Affiliate of any Specified Person solely because such other
Person has the contractual right or obligation to manage such Specified Person
unless such other Person controls such Specified Person through equity ownership
or otherwise.
"Aggregate Net Losses" means, for any Distribution Date, the
amount equal to (i) the aggregate principal balance of
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the Receivables that became Defaulted Receivables during the related Collection
Period minus (ii) the Liquidation Proceeds allocable to principal collected
during such Collection Period with respect to any Defaulted Receivables.
"Amount Financed" in respect of a Receivable means the amount
advanced under the Receivable toward the purchase price of the Financed Vehicle
and related costs.
"Assertion" has the meaning specified in Section 4.11.
"Authenticating Agent" has the meaning specified in Section
6.12 and shall initially be the corporate trust office of Chase, and its
successors and assigns in such capacity.
"Authorized Officer" means any officer of the Trustee who is
authorized to act on behalf of the Trustee and who is identified as such on the
list of authorized officers delivered by the Trustee to the Seller and the
Servicer.
"Available Interest" means, for any Distribution Date, that
portion of Collections on the Receivables received during the related Collection
Period allocated to interest, all Advances made by the Servicer with respect to
such Distribution Date and, to the extent attributable to interest, the
Repurchase Amount received with respect to each Receivable repurchased by the
Seller or purchased by the Servicer under an obligation that arose during the
related Collection Period.
"Available Principal" means, for any Distribution Date, that
portion of Collections on the Receivables received during the related Collection
Period allocated to the principal balance of the Receivables, and, to the extent
attributable to principal, the Repurchase Amount received with respect to each
Receivable repurchased by the Seller or purchased by the Servicer under an
obligation that arose during the related Collection Period.
"Available Reserve Account Amount" shall mean, for each
Distribution Date, an amount equal to the lesser of (i) the amount on deposit in
the Reserve Account (exclusive of Investment Earnings thereon) and (ii) the
Specified Reserve Account Balance with respect to such Distribution Date.
"Average Delinquency Percentage" means, for any Distribution
Date, the average of the Delinquency Percentages for such Distribution Date and
the preceding two (2) Distribution Dates.
"Average Net Loss Ratio" means, for any Distribution Date, the
average of the Net Loss Ratios for such Distribution Date and the preceding two
(2) Distribution Dates.
"Base Rate" means, with respect to each Receivable, the
weighted average interest rate on the Receivable equal to (i) the
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Class A Percentage multiplied by the sum of the Class A Pass-Through Rate and
the Servicing Fee Rate, plus (ii) the Class B Percentage multiplied by the sum
of the Class B Pass-Through Rate and the Servicing Fee Rate.
"Book-Entry Certificates" means beneficial interests in the
Certificates described in Section 6.8, the ownership and transfers of which
shall be made through book entries by a Clearing Agency or Foreign Clearing
Agency as described in Section 6.8.
"Business Day" means a day, other than a Saturday or a Sunday,
on which the Trustee and banks located in New York, New York, Wilmington,
Delaware and [__________________] are open for the purpose of conducting a
commercial banking business.
"Cedel" means Cedel Bank, Societe Anonyme.
"Certificate Owner" means, with respect to a Book-Entry
Certificate, the Person who is the owner of such Book-Entry Certificate, as
reflected on the books of the Clearing Agency or Foreign Clearing Agency or on
the books of a direct or indirect Clearing Agency Participant.
"Certificate Register" means the register maintained pursuant
to Section 6.3.
"Certificateholders" or "Holders" means, collectively, the
Class A Certificateholders and the Class B Certificateholders.
"Certificates" means, collectively, the Class A Certificates
and the Class B Certificates.
"Chase" means, The Chase Manhattan Bank, a New York banking
corporation.
"Chase Direct Receivable" means a Receivable originated by
Chase directly with an Obligor without the involvement of a Dealer.
"Class A Certificate" means a certificate executed on behalf
of the Trust and authenticated by the Trustee substantially in the form of
Exhibit A-1 attached hereto.
"Class A Certificate Balance" means, at any date of
determination, the Original Class A Certificate Balance, as reduced by all
amounts allocable to principal on the Class A Certificates distributed to Class
A Certificateholders prior to such date.
"Class A Certificateholder" or "Class A Holder" means the
Person in whose name a Class A Certificate is registered in the Certificate
Register, except that, solely for the purpose of
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giving any consent, request, waiver or demand pursuant to this Agreement, the
interest evidenced by any Class A Certificate registered in the name of the
Seller, the Servicer, or any Person actually known to an Authorized Officer of
the Trustee to be an Affiliate of the Seller or the Servicer, shall not be taken
into account in determining whether the requisite percentage necessary to effect
any such consent, request, waiver or demand shall have been obtained.
"Class A Distribution Account" means the account established
and maintained as such pursuant to Section 5.1(a).
"Class A Interest Carryover Shortfall" means, (a) for the
initial Distribution Date, zero, and (b) for any other Distribution Date, the
excess of Class A Monthly Interest for the preceding Distribution Date and any
outstanding Class A Interest Carryover Shortfall for such preceding Distribution
Date over the amount in respect of interest that is actually deposited in the
Class A Distribution Account on such preceding Distribution Date, plus 30 days
of interest on such excess, to the extent permitted by law, at the Class A
Pass-Through Rate.
"Class A Interest Distributable Amount" means, for any
Distribution Date, the sum of Class A Monthly Interest for such Distribution
Date and the Class A Interest Carryover Shortfall for such Distribution Date.
"Class A Monthly Interest" means, for any Distribution Date,
one-twelfth of the Class A Pass-Through Rate multiplied by the Class A
Certificate Balance as of the preceding Distribution Date (after giving effect
to any payments made on such preceding Distribution Date) or, in the case of the
first Distribution Date, as of the Closing Date.
"Class A Monthly Principal" means, for any Distribution Date,
the sum of (a) the Class A Percentage of the Available Principal for such
Distribution Date and (b) the Class A Percentage of Aggregate Net Losses with
respect to the related Collection Period.
"Class A Pass-Through Rate" means ____% per annum.
"Class A Percentage" means, a fraction (expressed as a
percentage with eight decimal places), the numerator if which is the Original
Class A Certificate Balance and the denominator of which is the Original
Certificate Balance.
"Class A Pool Factor" means, with respect to any Distribution
Date, the Class A Certificate Balance as of such Distribution Date (after giving
effect to any payments to be made on such Distribution Date), divided by the
Original Class A Certificate Balance, expressed as a eight-digit decimal.
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"Class A Principal Carryover Shortfall" means, for any
Distribution Date, the excess of Class A Monthly Principal for the preceding
Distribution Date and any outstanding Class A Principal Carryover Shortfall for
such preceding Distribution Date over the amount in respect of principal that is
actually deposited in the Class A Distribution Account on such preceding
Distribution Date.
"Class A Principal Distributable Amount" means, for any
Distribution Date, the sum of Class A Monthly Principal for such Distribution
Date and, in the case of any Distribution Date other than the initial
Distribution Date, the Class A Principal Carryover Shortfall for such
Distribution Date. In addition, on the Final Scheduled Distribution Date, the
Class A Principal Distributable Amount shall include any additional amount
required to reduce the outstanding aggregate principal balance of the Class A
Certificates to zero.
"Class B Certificate" means a certificate executed on behalf
of the Trust and authenticated by the Trustee substantially in the form of
Exhibit A-2 hereto.
"Class B Certificate Balance" means, at any time, the Original
Class B Certificate Balance, as reduced by all amounts allocable to principal on
the Class B Certificates distributed to Class B Certificateholders prior to such
time.
"Class B Certificateholder" or "Class B Holder" means the
Person in whose name a Class B Certificate shall be registered in the
Certificate Register, except that, solely for the purpose of giving any consent,
request or waiver pursuant to this Agreement, the interest evidenced by any
Class B Certificate registered in the name of the Seller, the Servicer, or any
Person actually known to an Authorized Officer of the Trustee to be an Affiliate
of the Seller or the Servicer, shall not be taken into account in determining
whether the requisite percentage necessary to effect any such consent, request
or waiver shall have been obtained.
"Class B Distribution Account" means the account established
and maintained as such pursuant to Section 5.1(a).
"Class B Interest Carryover Shortfall" means, (a) for the
initial Distribution Date, zero, and (b) for any other Distribution Date, the
excess of Class B Monthly Interest for the preceding Distribution Date and any
outstanding Class B Interest Carryover Shortfall for such preceding Distribution
Date over the amount in respect of interest actually deposited in the Class B
Distribution Account on such preceding Distribution Date, plus 30 days of
interest on such excess, to the extent permitted by law, at the Class B
Pass-Through Rate.
"Class B Interest Distributable Amount" means, with respect
to any Distribution Date, the sum of Class B Monthly
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<PAGE>
Interest for such Distribution Date and the Class B Interest Carryover Shortfall
for such Distribution Date.
"Class B Monthly Interest" means, for any Distribution Date,
one-twelfth of the Class B Pass-Through Rate multiplied by the Class B
Certificate Balance as of the preceding Distribution Date (after giving effect
to any payments made on such preceding Distribution Date) or, in the case of the
first Distribution Date, as of the Closing Date, which amount includes any
amounts due with respect to the Class B Stripped Coupon.
"Class B Monthly Principal" means, with respect to any
Distribution Date, the sum of (a) the Class B Percentage of the Available
Principal for such Distribution Date and (b) the Class B Percentage of Aggregate
Net Losses with respect to the related Collection Period.
"Class B Pass-Through Rate" means ____% per annum.
"Class B Percentage" means, a fraction (expressed as a
percentage with eight decimal places), the numerator if which is the Original
Class B Certificate Balance and the denominator of which is the Original
Certificate Balance.
"Class B Pool Factor" means, with respect to any Distribution
Date, the Class B Principal Balance as of such (after giving effect to any
payments to be made on such Distribution Date), divided by the Original Class B
Certificate Balance, expressed as a eight-digit decimal.
"Class B Principal Carryover Shortfall" means, for any
Distribution Date, the excess of Class B Monthly Principal for the preceding
Distribution Date and any outstanding Class B Principal Carryover Shortfall for
such preceding Distribution Date over the amount in respect of principal
actually deposited in the Class B Distribution Account for such preceding
Distribution Date.
"Class B Principal Distributable Amount" means, for any
Distribution Date, the sum of Class B Monthly Principal for such Distribution
Date and, in the case of any Distribution Date other than the initial
Distribution Date, the Class B Principal Carryover Shortfall for such
Distribution Date. In addition, on the Final Scheduled Distribution Date, the
Class B Principal Distributable Amount will include any additional amount
required to reduce the outstanding aggregate principal balance of the Class B
Certificates to zero.
"Class B Stripped Coupon" means, with respect to each
Receivable, the amount of interest allocable to a Class B Certificateholder in
excess of such Class B Certificateholder's pro rata percentage interest in the
interest payable on the Receivable at the Base Rate.
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"Clearing Agency" means an organization registered as a
"clearing agency" pursuant to Section 17A of the Exchange Act. The initial
Clearing Agency shall be The Depository Trust Company.
"Clearing Agency Participant" means a broker, dealer, bank,
other financial institution or other person for whom from time to time a
Clearing Agency effects book-entry transfers of securities deposited with the
Clearing Agency (including a Foreign Clearing Agency).
"Closing Date" means ____________, ______.
"Code" means the Internal Revenue Code of 1986, as amended.
"Collateral Agent" means
[_______________________________________], a national banking association, in
its capacity as collateral agent for the benefit of the Certificateholders with
respect to the Reserve Account and the Retained Yield.
"Collection Account" means the account established and
maintained pursuant to Section 5.1(a).
"Collection Period" means each calendar month beginning
__________ __, ____ until the Trust shall terminate pursuant to Article XI.
"Collections" means all collections in respect of Receivables.
"Contract Rate" of a Receivable means the annual rate of
interest stated in such Receivable.
"Cutoff Date" means __________ __, ____.
"Dealer" means the dealer which sold a Financed Vehicle
related to a Dealer Receivable and which originated or assisted in the
origination of such Dealer Receivable relating to such Financed Vehicle under a
Dealer Agreement.
"Dealer Agreement" means any agreement and, if applicable,
assignment under which Dealer Receivables were originated by or through a Dealer
and sold to the Seller or an Affiliate of the Seller.
"Dealer Receivable" means each Receivable which is not a
Direct Receivable.
"Defaulted Receivable" means a Receivable (other than a
Repurchased Receivable) as to which the Servicer has determined based on its
usual collection practices and procedures, during any Collection Period, that
eventual payment in full of the
7
<PAGE>
Amount Financed (including accrued interest thereon) is unlikely; provided that
a Receivable shall become a Defaulted Receivable on the last day of the calendar
month in which more than 10% of any scheduled payment becomes 240 days
delinquent, regardless of whether any such determination has been made.
"Definitive Certificates" has the meaning specified in
Section 6.8.
"Delinquency Percentage" means, for any Distribution Date, the
sum of the outstanding principal balances of all Receivables which were 60 days
or more delinquent (including Receivables, which are not Defaulted Receivables,
relating to Financed Vehicles that have been repossessed), as of the close of
business on the last day of the Collection Period immediately preceding such
Distribution Date, determined in accordance with the Servicer's normal
practices, such sum expressed as a percentage of the Pool Balance as of the
close of business on the last day of such Collection Period.
"Delivery" when used with respect to Reserve Account Property
means: (a)(i) with respect to "certificated securities" within the meaning of
Section 8-102(1)(a) of the Relevant UCC not held by the initial Clearing Agency
or other "instruments" within the meaning of Section 9-105(1)(i) of the Relevant
UCC, (A) physical delivery thereof to the Collateral Agent endorsed to, or
registered in the name of, the Collateral Agent or endorsed in blank, or (B)
with respect to a certificated security, possession thereof by a financial
intermediary (as defined in Section 8-313(4) of the Relevant UCC) and the
making by such financial intermediary of entries on its books and records
identifying such certificated securities as belonging to the Collateral Agent
and the sending by such financial intermediary of a confirmation of the purchase
of such certificated security by the Collateral Agent, or (ii) with respect to
"certificated securities" within the meaning of Section 8-102(4)(a) of the
Relevant UCC held by the initial Clearing Agency or by a "custodian bank" within
the meaning of Section 8-102(4) of the Relevant UCC (a "Custodian Bank") or a
nominee of either subject to the control of the initial Clearing Agency, the
delivery thereof to the initial Clearing Agency or a Custodian Bank or a nominee
of either subject to the control of the initial Clearing Agency and in bearer
form or endorsed in blank by an appropriate person or registered on the books of
the issuer thereof in the name of the initial Clearing Agency or its Custodian
Bank or a nominee of either and the identification by book-entry or otherwise on
the records of the financial intermediary, the sending of a confirmation by the
financial intermediary of the purchase by the Collateral Agent of such
securities and the making by such financial intermediary of entries on its books
and records identifying such certificated securities as belonging to the
Collateral Agent (all of the foregoing, "Physical Property"), and such
additional or alternative procedures as may hereafter become appropriate to
effect the complete transfer of ownership of any
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such Account Property to the Collateral Agent, consistent with changes in
applicable law or regulations or the interpretation thereof;
(b) with respect to any United States Securities Entitlements
that are maintained in the form of entries on the records of the Federal Reserve
System pursuant to Federal book-entry regulations, the following procedures:
entries on the records of a member bank of the Federal Reserve System
identifying such Reserve Account Property as belonging to a Federal Reserve
"depositary" pursuant to applicable Federal regulations and the sending by such
depositary of written confirmation of the purchase of such Reserve Account
Property to the Collateral Agent; the making by such depositary of entries in
its books and records identifying such Reserve Account Property as belonging to,
or otherwise subject to a security interest in favor of, the Collateral Agent;
and such additional or alternative procedures as may hereafter become
appropriate to effect transfer of ownership of any such Reserve Account Property
to the Collateral Agent consistent with changes in applicable law or regulations
or the interpretation thereof; and
(c) with respect to any item of Reserve Account Property that
is an uncertificated security under Article 8 of the Relevant UCC and that is
not governed by clause (b) above, registration on the books and records of the
issuer thereof in the name of the financial intermediary, the sending of a
confirmation by the financial intermediary of the purchase by the Collateral
Agent or its nominee, agent or custodian of such uncertificated security, the
making by such financial intermediary of entries on its books and records
identifying such uncertificated certificates as belonging to the Collateral
Agent or its nominee, agent or custodian; and such additional or alternative
procedures as may hereafter become appropriate to effect transfer of ownership
of any such Reserve Account Property to the Collateral Agent or its nominee or
custodian consistent with changes in applicable law or regulations or the
interpretation thereof.
"Deposit Date" means the Business Day immediately preceding
each Distribution Date.
"Depository Agreement" means the agreement among the Seller,
the Trustee and the initial Clearing Agency, in the form attached hereto as
Exhibit B, as the same may be amended, supplemented or otherwise modified and in
effect from time to time.
"Determination Date" means the 10th calendar day of the month
(or, if such 10th calendar day is not a Business Day, the Business Day preceding
the 10th calendar day of the month) immediately succeeding the related
Collection Period.
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"Direct Receivable" means either a Chase Direct Receivable or
a Receivable originated by the Seller or an Affiliate of the Seller directly
with an Obligor without the involvement of a Dealer.
"Distribution Date" means, in the case of the first Collection
Period, __________, __ 199_, and in the case of every Collection Period
thereafter, the 15th day of the following month, or if the 15th day is not a
Business Day.
"Eligible Deposit Account" means (a) a segregated identifiable
trust account established in the trust department of a Qualified Trust
Institution, which shall, except in the case of the Reserve Account, initially
be Chase, and may be maintained with Chase so long as Chase is a Qualified Trust
Institution; or (b) a separately identifiable deposit account established in the
deposit taking department of a Qualified Institution which shall be, except in
the case of the Reserve Account, Chase so long as Chase is a Qualified
Institution.
"Euroclear Operator" means Morgan Guaranty Trust Company of
New York, Brussels, Belgium office, in its capacity as the operator of the
Euroclear system.
"Event of Servicing Termination" means an event specified in
Section 9.1.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended.
"Farm Credit Entitlement" means a "Security Entitlement" as
defined in 12 C.F.R. ss.615.5450.
"FDIC" means the Federal Deposit Insurance Corporation or any
successor thereto.
"FHL Bank Entitlement": means a "Security Entitlement" as
defined in 12 C.F.R. ss. 912.1.
"FHLMC" means the Federal Home Loan Mortgage Corporation or
any successor thereto.
"Final Scheduled Distribution Date" shall be __________ __,
____, or, if such day is not a Business Day, the next succeeding Business Day.
"Financed Vehicle" means, with respect to a Receivable, the
new or used automobile or light-duty truck, together with all accessions
thereto, securing an Obligor's indebtedness under such Receivable.
"Fitch" means Fitch Investors Service L.P. and its
successors and assigns.
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"FNMA" means the Federal National Mortgage Association or
any successor thereto.
"Foreign Clearing Agency" means Cedel and the Euroclear
Operator.
"Funding Corporation Entitlement" means a "Security
Entitlement" as defined in 12 C.F.R. ss.1511.1.
"HUD Entitlement" means a "Security Entitlement" as defined
in 24 C.F.R. ss. 81.2.
"Investment Earnings" means investment earnings on funds
deposited into the Reserve Account or the Collection Account, as applicable, in
each case, net of losses and investment expenses.
"Late Fees" means any late charges, credit related extension
fees, non-credit related extension fees or other administrative fees or similar
charges allowed by applicable law with respect to the Receivables.
"Lien" means a security interest, lien, charge, pledge or
encumbrance of any kind other than tax liens, mechanics' liens or any other
liens that attach by operation of law.
"Liquidation Proceeds" means, with respect to any Receivable,
(i) insurance proceeds, (ii) the monies collected during a Collection Period
from whatever source on a Defaulted Receivable and (iii) proceeds of a Financed
Vehicle sold after repossession, in each case net of any liquidation expenses
and payments required by law to be remitted to the Obligor.
"Moody's" means Moody's Investors Service, Inc., a division of
Dun & Bradstreet Corporation, and its successors and assigns.
"Net Loss Ratio" means, for any Distribution Date, an amount,
expressed as a percentage, equal to (i) the Aggregate Net Losses for such
Distribution Date, divided by (ii) the average of the Pool Balances on each of
the related Settlement Dates and the last day of the related Collection Period.
"Obligor" on a Receivable means the purchaser or the
co-purchasers of the Financed Vehicle purchased in part or in whole by the
execution and delivery of such Receivable or any other Person who owes or may be
liable for payments under such Receivable.
"Officer's Certificate" means a certificate signed by the
chairman of the board, the president, the treasurer, the controller, any
executive or senior vice president or any vice president of the Seller or
Servicer, as appropriate.
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"Opinion of Counsel" means a written opinion of counsel (who
may be counsel to the Seller or the Servicer) reasonably acceptable in form and
substance to the Trustee.
"Optional Purchase Percentage" shall be ___%.
"Original Certificate Balance" means the sum of the Original C
lass A Certificate Balance and the Original Class B Certificate Balance.
"Original Class A Certificate Balance" means $__________.
"Original Class B Certificate Balance" means $__________.
"Original Pool Balance" shall be $__________.
"Outstanding Receivable" means, as of the time of reference
thereto, a Receivable that (i) has not been fully paid, (ii) has not become a
Defaulted Receivable, and (iii) has not become a Repurchased Receivable.
"Pass-Through Rate" means either the Class A Pass-Through Rate
or the Class B Pass-Through Rate, as applicable.
"Paying Agent" has the meaning specified in Section 6.11 and
shall initially be the corporate trust office of Chase.
"Permitted Investments" means, at any time, any one or more of
the following obligations, securities (certificated or uncertificated) or
instruments (excluding any security with the "r" symbol attached to its rating):
(i) obligations of the United States of
America or any agency thereof; provided such obligations are backed by
the full faith and credit of the United States of America;
(ii) general obligations of or
obligations guaranteed as to the timely payment of interest and
principal by any state of the United States of America or the
District of Columbia then rated "A-l+" or "AAA" by Standard & Poor's,
"F-1+" and "AAA" by Fitch (if rated by Fitch) and "P-1" or "Aaa" by
Moody's;
(iii) commercial paper which is then rated
"P-1" by Moody's, "F-1+" by Fitch (if rated by Fitch) and "A-l+" by
Standard & Poor's;
(iv) certificates of deposit, demand or
time deposits, federal funds or banker's acceptances issued by any
depository institution or trust company (including the Trustee acting
in its commercial banking capacity)
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incorporated under the laws of the United States or of any state
thereof or incorporated under the laws of a foreign jurisdiction with a
branch or agency located in the United States of America and subject to
supervision and examination by federal or state banking authorities
which short term unsecured deposit obligations of such depository
institution or trust company are then rated "P-1" by Moody's, "F-1+" by
Fitch (if rated by Fitch) and "A-l+" by Standard & Poor's;
(v) demand or time deposits of, or
certificates of deposit issued by, any bank, trust company, savings
bank or other savings institution, provided such deposits or
certificates of deposit are fully insured by the FDIC;
(vi) guaranteed reinvestment agreements
issued by any bank, insurance company or other corporation the short
term unsecured debt or deposits of which are rated "P-1" by Moody's,
"F-1+" by Fitch (if rated by Fitch) and "A-l+" by Standard & Poor's or
the long-term unsecured debt of which are rated "Aaa" by Moody's, "AAA"
by Fitch (if rated by Fitch) and "AAA" by Standard & Poor's;
(vii) repurchase obligations with respect
to any security described in clauses (i) or (ii) herein or any other
security issued or guaranteed by the FHLMC, FNMA or any other agency or
instrumentality of the United States of America which is backed by the
full faith and credit of the United States of America, in either case
entered into with a federal agency or a depository institution or trust
company (acting as principal) described in (iv) above;
(viii) investments in money market funds,
which funds (A) are not subject to any sales, load or other similar
charge; and (B) are rated at least "AAAM" or "AAAM-G" by Standard &
Poor's, "AAAV-1+" by Fitch (if rated by Fitch) and "Aaa" by Moody's;
(ix) such other investments where the
short-term unsecured debt or deposits of the obligor on such
investments are rated "A-l+" by Standard & Poor's, "F-1" by Fitch (if
rated by Fitch) and "P-1" by Moody's; and
(x) any other obligation or security
satisfying the Rating Agency Condition;
provided, however, that with respect to the obligations or securities described
in (i) through (x) above which are considered an asset (i.e., property) of the
Trust, such obligations or securities must mature not later than the Deposit
Date next succeeding the date the trust invested in such obligation or security,
except if the Collection Account is maintained with the Trustee, for investments
in obligations or securities on which the Trustee is to obligor (including
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repurchase agreements on which the Trustee in its commercial capacity is liable
as principal) which investments may mature on the Distribution Date next
succeeding the date the Trust may invest in such obligation or security.
Permitted Investments include money market mutual funds (so long as such fund
has the ratings specified in clause (viii) hereof), including, without
limitation, the VISTA U.S. Government Money Market Fund or any other fund for
which Chase, the Trustee or an Affiliate thereof serves as an investment
advisor, administrator, shareholder servicing agent, and/or custodian or
subcustodian, notwithstanding that (i) Chase,
[_______________________________________] or an Affiliate thereof charges and
collects fees and expenses from such funds for services rendered, (ii) Chase,
[________________________________] or an Affiliate thereof charges and collects
fees and expenses for services rendered pursuant to this Agreement, and (iii)
services performed for such funds and pursuant to this Agreement may converge at
any time. The Trustee specifically authorizes Chase,
[_______________________________________] or an Affiliate thereof to charge and
collect all fees and expenses from such funds for services rendered to such
funds (but not to exceed investment earnings), in addition to any fees and
expenses Chase USA or [_______________________________________], as applicable,
may charge and collect for services rendered pursuant to this Agreement.
"Person" means a legal person, including any individual,
corporation, estate, partnership, joint venture, association, joint stock
company, trust, unincorporated organization, or government or any agency or
political subdivision thereof, or any other entity of whatever nature.
"Physical Property" has the meaning assigned to such terms
in the definition of "Delivery" above.
"Pool Balance" as of any date of determination means the
aggregate Principal Balance of the Receivables, calculated as of the close of
business on such date.
"Principal Balance" of a Receivable, as of any date of
determination, means the Amount Financed minus that portion of all payments
received on or prior to such date allocable to principal. The Principal Balance
of a Defaulted Receivable or a Repurchased Receivable shall be deemed to be
zero, in each case, as of such date.
"Qualified Institution" means a depository institution
organized under the laws of the United States of America or any State thereof or
incorporated under the laws of a foreign jurisdiction with a branch or agency
located in the United States of America or any State thereof and subject to
supervision and examination by federal or state banking authorities which at all
times has the Required Deposit Rating and, in the case of any
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such institution organized under the laws of the United States of America, whose
deposits are insured by the FDIC.
"Qualified Trust Institution" means an institution organized
under the laws of the United States of America or any State thereof or
incorporated under the laws of a foreign jurisdiction with a branch or agency
located in the United States of America or any State thereof and subject to
supervision and examination by federal or state banking authorities which at all
times (i) is authorized under such laws to act as a trustee or in any other
fiduciary capacity, (ii) has not less than one billion dollars in assets under
fiduciary management, and (iii) has a long term deposits rating of not less than
"BBB-" by Standard & Poor's, "BBB-" by Fitch (if rated by Fitch) and "Baa3" by
Moody's.
"Rating Agency" means any of Standard & Poor's, Moody's
or Fitch.
"Rating Agency Condition" means, with respect to any action or
event, that each Rating Agency shall have notified the Seller, the Servicer and
the Trustee, in writing, that such action or event will not result in reduction
or withdrawal of the rating of any outstanding Certificate with respect to which
it is the Rating Agency.
"Receivable" means a retail installment sale contract or
purchase money promissory note or other promissory note and security agreement
executed by an Obligor in respect of a Financed Vehicle, and all proceeds
thereof and payments thereunder (other than interest accrued and unpaid as of
the Cutoff Date), which Receivable shall be identified on Schedule A to this
Agreement.
"Receivable Files" means the documents specified in
Section 3.3.
"Receivables Pool" means the pool of Receivables
included in the Trust.
"Record Date" means, with respect to any Distribution Date,
the Business Day prior to such Distribution Date unless Definitive Certificates
are issued, in which case such Record Date, with respect to such Definitive
Certificates, shall mean the last day of the immediately preceding calendar
month.
"Relevant UCC" means the Uniform Commercial Code as in
effect in the applicable jurisdiction.
"Repurchase Amount" of a Repurchased Receivable or any
Receivable purchased by the Servicer pursuant to Sections 3.2, 4.7 or 11.2 means
the sum, as of the last day of the Collection Period on which such Receivable
becomes such, of the Principal Balance thereof plus the Accrued Interest
thereon; of a Defaulted
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Receivable means the sum, as of the Settlement Date on which such Receivable is
to be purchased, of the principal balance thereof plus the Accrued Interest
thereon (the accrued interest for the Collection Period in which such Receivable
became a Defaulted Receivable to be calculated at a rate equal to one-twelfth of
the sum of (A) the Weighted Average Pass-Through Rate and (B) the Servicing Fee
Rate).
"Repurchased Receivable" as of any Settlement Date, means a
Receivable repurchased by the Seller pursuant to Section 3.2 or purchased by the
Servicer pursuant to Section 4.7.
"Required Deposit Rating" shall be a short-term certificate of
deposit rating from Moody's of "P-1," from Fitch of "F-1+" (if rated by Fitch)
and from Standard & Poor's of "A- l+," and a long-term unsecured debt rating of
not less than "AA-" by Standard & Poor's, "AA" by Fitch (if rated by Fitch) and
"Aa3" by Moody's.
"Reserve Account" means the account designated as such,
established and maintained pursuant to Section 5.6(a).
"Reserve Account Initial Deposit" means an amount equal
to $__________.
"Reserve Account Property" means all amounts and investments
held from time to time in the Reserve Account (whether in the form of deposit
accounts, instruments, certificated securities, book-entry securities,
uncertificated securities or otherwise), and all proceeds of the foregoing.
"Retained Yield" means, with respect to each Receivable, a
fixed portion of the interest due on such Receivable equal to the difference
between the Contract Rate of such Receivable and the Base Rate of such
Receivable.
"Sallie Mae Entitlement" means a "Security Entitlement"
as defined in 31 C.F.R. SS.345.1.
"Securities Act" means the Securities Act of 1933, as
amended.
"Seller" means Chase Manhattan Bank USA, N.A., a national
banking association with its principal executive offices in Wilmington,
Delaware, in its capacity as the seller of the Receivables under this Agreement,
and each successor to Chase Manhattan Bank USA, N.A. (in the same capacity)
pursuant to Section 7.3.
"Servicer" means Chase Manhattan Bank USA, N.A., a national
banking association with its principal executive offices in Wilmington,
Delaware, in its capacity as the servicer of the Receivables under this
Agreement, each successor to Chase
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Manhattan Bank USA, N.A. (in the same capacity) pursuant to Section 8.3, and
each successor Servicer pursuant to Section 9.2.
"Servicer's Certificate" means a certificate, substantially in
the form of Exhibit D attached hereto, completed and executed by the Servicer by
its chairman of the board, the president, treasurer, controller or any
executive, senior vice president or vice president pursuant to Section 4.9.
"Servicing Fee" with regard to a Collection Period means the
fee payable to the Servicer for services rendered during such Collection Period,
determined pursuant to Section 4.8.
"Servicing Fee Rate" means 1.00% per annum.
"Settlement Date" means, with respect to any Collection
Period, the last day of the Collection Period immediately preceding such
Collection Period, and with respect to any Distribution Date, the last day of
the second Collection Period preceding the Collection Period in which such
Distribution Date occurs.
"Specified Reserve Account Balance", with respect to any
Distribution Date, means ____% of the Pool Balance as of the related Settlement
Date, but in any event will not be less than the lesser of (i) $__________ and
(ii) the sum of (A) such Pool Balance plus (B) an amount sufficient to pay
interest on such Pool Balance through the Final Scheduled Distribution Date at a
rate equal to the sum of (x) the weighted average of the Class A Pass-Through
Rate and the Class B Pass-Through Rate (based on their respective Certificate
balances) plus (y) the Servicing Fee Rate; provided that the Specified Reserve
Account Balance will be calculated using a percentage of ____% for any
Distribution Date (beginning with the ____________________ Distribution Date)
for which the Average Net Loss Ratio exceeds ____% or the Average Delinquency
Percentage exceeds ____%. Upon written notification to the Trustee by the
Seller, the Specified Reserve Account Balance may be reduced to a lesser amount
as determined by the Seller so long as such reduction satisfies the Rating
Agency Condition.
"Standard & Poor's" means Standard & Poor's Ratings Services,
and its successors and assigns.
"Total Distribution Amount" means, for any Distribution Date,
the sum of Available Interest and Available Principal for such Distribution
Date. The Total Distribution Amount on any Distribution Date shall exclude all
payments and proceeds (including any Liquidation Proceeds and any amounts
received from Dealers with respect to Receivables) of (i) any Receivables the
Repurchase Amount of which has been included in the Total Distribution Amount
for a prior Distribution Date and (ii) Investment Earnings and any Late Fees.
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"Transfer Agent and Certificate Registrar" has the meaning
specified in Section 6.3 and shall initially be the corporate trust office of
Chase.
"Treasury Entitlement" means a "Security Entitlement"
as defined in 31 C.F.R. SS.357.2.
"Treasury Regulations" means the treasury regulations
promulgated under the Code.
"Trust" means the Chase Manhattan Auto Grantor Trust 199_-_,
the estate of which shall consist of the property transferred thereto pursuant
to this Agreement; funds deposited in the Collection Account and the
Distribution Accounts (other than any funds in respect of the Retained Yield)
and proceeds of the foregoing.
"Trustee" means, initially, [__________________________
_____________], its successor in interest pursuant to Section 10.11, and any
successor Trustee pursuant to Section 10.10.
"Trustee's Certificate" means a certificate completed and
executed by an Authorized Officer pursuant to Section 10.2 and substantially in
the forms attached hereto as Exhibits C-1 or C-2.
"United States Security Entitlement" means a Treasury
Entitlement, a HUD Entitlement, a FHL Bank Entitlement, a Funding
Corporation Entitlement, a Farm Credit Entitlement or a Sallie
Mae Entitlement.
"Weighted Average Pass-Through Rate" means the weighted
average of the Class A Pass-Through Rate and the Class B Pass-Through Rate
(based on their respective Certificate balances).
SECTION 1.2. Usage of Terms. With respect to all terms in this
Agreement, the singular includes the plural and the plural the singular; words
importing any gender include the other gender; references to "writing" include
printing, typing, lithography, and other means of reproducing words in a visible
form; references to agreements and other contractual instruments include all
subsequent amendments thereto or changes therein entered into in accordance with
their respective terms and not prohibited by this Agreement; references to
Persons include their permitted successors and assigns; and the term "including"
means "including without limitation." All references herein to Articles,
Sections, Subsections and Exhibits are references to Articles, Sections,
Subsections and Exhibits contained in or attached to this Agreement unless
otherwise specified, and each such Exhibit is part of the terms of this
Agreement.
[SECTION 1.3. Simple Interest Method; Allocations.
All allocations of payments to principal and interest and
determinations of periodic charges and the like on the
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Receivables shall be based on a year with the actual number of days in such year
and twelve months with the actual number of days in each such month. Each
payment on a Receivable shall be applied first to the amount of interest accrued
on such Receivable to the date of receipt, then to reduce the scheduled
principal amount outstanding on the Receivable to the extent of the remaining
scheduled payment and then to any outstanding fees and Late Fees under the terms
of the Receivable. Amounts paid by the Seller or the Servicer in respect of
Repurchased Receivables shall be allocated first to any Accrued Interest and
then to the Principal Balance of the related Receivable.]
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ARTICLE II
THE TRUST CONVEYANCE OF THE RECEIVABLES
SECTION 2.1. Creation of the Trust. Upon the execution of this
Agreement by the parties hereto, there is hereby created the Chase Manhattan
Auto Grantor Trust 199_-_.
SECTION 2.2. Conveyance of Receivables. In consideration of
the Trustee's delivery to, and upon the order of the Seller of authenticated
Certificates, in authorized denominations, in an aggregate amount equal to the
Original Pool Balance, the Seller does hereby sell, transfer, assign, and
otherwise convey to the Trustee on behalf of the Trust, without recourse
(subject to the Seller's obligations herein):
(i) all right, title, and interest of the
Seller in, to and under the Receivables listed in Schedule A hereto,
all proceeds thereof and all amounts and monies received thereon on and
after the Cutoff Date (including proceeds of the repurchase of
Receivables by the Seller pursuant to Section 3.2 or the purchase of
Receivables by the Servicer pursuant to Section 4.7 or 11.2), together
with the interest of the Seller in the security interests in the
Financed Vehicles granted by the Obligors pursuant to the Receivables
and in any repossessed Financed Vehicles;
(ii) all right, title and interest of the
Seller in any Liquidation Proceeds and in any proceeds of any extended
warranties, theft and physical damage, credit life or credit disability
policies relating to the Financed Vehicles or the Obligors;
(iii) all right, title and interest of the
Seller in any proceeds from Dealer repurchase obligations
relating to the Receivables;
(iv) all right, title and interest of the
Seller in the Collection Account; and
(v) all proceeds (as defined in the
Relevant UCC) of the foregoing.
Simultaneously with the sale, transfer, assignment and
conveyance by the Seller pursuant to this Section 2.1, the Trustee on behalf of
the Trust does hereby transfer, assign and otherwise convey to the Seller all of
its right, title and interest in the Retained Yield.
Notwithstanding anything herein to the contrary, the property
of the Trust shall not include, and the Trust shall not have any right to, the
Retained Yield or the Reserve Account, any funds actually or deemed to be
deposited in such account or any
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investments therein except to the extent provided in Sections
5.2, 5.5 and 5.6.
In connection with such sale, the Seller agrees to record and
file, at its own expense, financing statements (and continuation statements with
respect to such financing statements when applicable) with respect to the
Receivables for the sale of accounts and chattel paper meeting the requirements
of applicable state law in such manner and in such jurisdictions as are
necessary to perfect the sale and assignment of the Receivables to the Trust.
It is the intention of the Seller and the Trustee that the
assignment and transfer herein contemplated constitute a sale of the
Receivables, conveying good title thereto free and clear of any liens and
encumbrances, from the Seller to the Trust and the Receivables not be part of
the Seller's estate in the event of an insolvency. In the event that such
conveyance is deemed to be a pledge to secure a loan, the Seller hereby grants
to the Trustee on behalf of the Trust for the benefit of the Certificateholders
a first priority perfected security interest in all of the Seller's right, title
and interest in, to and under the items of property listed in clauses (i)
through (iv) above, and in all proceeds (as defined in the Relevant UCC) of the
foregoing, to secure the loan deemed to be made in connection with such pledge
and, in such event, this Agreement shall constitute a security agreement under
applicable law.
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ARTICLE III
THE RECEIVABLES
SECTION 3.1. Representations and Warranties of Seller;
Conditions Relating to Receivables. (a) The Seller makes the following
representations and warranties as to the Receivables on which the Trustee shall
rely in accepting the Receivables in trust and authenticating the Certificates.
Such representations and warranties shall speak as of the Cutoff Date unless
otherwise specified, but shall survive the sale, transfer, and assignment of the
Receivables to the Trustee.
(i) Schedule of Receivables. The
information set forth in Schedule A hereto with respect to each
Receivable is true and correct in all material respects, and no
selection procedures materially adverse to the Certificateholders has
been utilized in selecting the Receivables from all receivables owned
by the Seller which meet the selection criteria specified herein.
(ii) No Sale or Transfer. No Receivable
has been sold, transferred, assigned or pledged by the Seller to any
Person other than the Trustee.
(iii) Good Title. Immediately prior to the
transfer and assignment of the Receivables to the Trust herein
contemplated, the Seller has good and marketable title to each
Receivable free and clear of all Liens and rights of others; and,
immediately upon the transfer thereof, the Trustee, for the benefit of
the Certificateholders, has either (i) good and marketable title to
each Receivable, free and clear of all Liens and rights of others, and
the transfer has been perfected under applicable law or (ii) a first
priority perfected security interest in each Receivable and the
proceeds thereof.
(b) Each Receivable satisfies the following
conditions as of the Cutoff Date unless otherwise specified and such conditions
shall survive the sale, transfer and assignment of the Receivables to the
Trustee pursuant to this Agreement.
(i) Acquisition. Each Receivable is
either a Dealer Receivable acquired directly or indirectly from or made
through a Dealer located in the United States (including the District
of Columbia) or is a Direct Receivable;
(ii) Security. Each Receivable is secured
by a new or used automobile or light-duty truck;
(iii) Maturity of Receivables. Each Re-
ceivable had a remaining maturity, as of the Cutoff Date, of not less
than __ months nor greater than __ months, and (A)
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in the case of each Receivable secured by a new Financed Vehicle, had
an original maturity of at least __ months and not more than __ months;
and (B) in the case of each Receivable secured by used Financed
Vehicle, had an original maturity of at least ____ months and not more
than ____.
(iv) Contract Rate. Each Receivable is a
fully-amortizing fixed rate [simple interest] contract that provides
for level scheduled monthly payments over its remaining term, and has a
Contract Rate of at least ____% and not more than _____%;
(v) No Repossessions. Each Receivable is
secured by a Financed Vehicle that, as of the Cutoff Date,
had not been repossessed without reinstatement of such
Receivable;
(vi) Obligor Not Subject to Bankruptcy
Proceedings. Each Receivable has been entered into by an
Obligor who had not been identified on the computer files of
the Seller as in bankruptcy proceedings as of the Cutoff
Date;
(vii) No Overdue Payments. Each Receivable
had no payment that was more than 30 days past due as of the
Cutoff Date;
(viii) [Reserved];
(ix) Remaining Principal Balance. Each
Receivable had a remaining principal balance, as of the
Cutoff Date, of at least $_____ and not greater than
$------;
(x) No Force Placed Insurance. As of the
Cutoff Date, each Receivable was secured by a Financed Vehicle that was
not insured by a force placed insurance policy or any vendor's single
interest and non-filing insurance policy;
(xi) Receivable Files. The Receivable
Files shall be kept at one or more of the locations
specified in Schedule B hereto;
(xii) Characteristics of Receivables. Each
Receivable (a)(i) in the case of a Dealer Receivable, has been
originated in the form of a credit sales transaction by a Dealer or a
purchase money loan through a Dealer located in one of the States of
the United States (including the District of Columbia) for the retail
financing of a Financed Vehicle or (ii) in the case of a Direct
Receivable, has been originated by Chase or an affiliate thereof in the
form of a secured loan for the retail financing of a Financed Vehicle,
and, in each case, has been fully and properly executed by
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the parties thereto, (b)(i) in the case of a Dealer Receivable, if a
retail installment sales contract, has been purchased by the Seller
from the originating Dealer or an affiliate of the Seller, and has been
validly assigned by such Dealer or an affiliate of the Seller to the
Seller in accordance with its terms or (ii) in the case of a Chase
Direct Receivable has been purchased by the Seller from Chase, and has
been validly assigned by Chase to the Seller; (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 fully amortizing
level scheduled monthly payments (provided that the payment in the last
month in the life of the Receivable may be different from the level
scheduled payment) and for accrual of interest at a fixed rate
according to the [simple interest] method;
(xiii) Compliance with Laws. Each Receivable
and each sale of the related Financed Vehicle complied at the time it
was originated or made, and complied on and after the Cutoff Date, in
all material respects with all requirements of applicable federal,
state, and local laws, and regulations thereunder, including usury
laws, the Federal Truth-in-Lending Act, the Equal Credit Opportunity
Act, the Fair Credit Reporting Act, the Federal Trade Commission Act,
the Magnuson-Moss Warranty Act, Federal Reserve Board Regulations B and
Z, state adaptations of the National Consumer Act and of the Uniform
Consumer Credit Code, and any other consumer credit, equal opportunity,
and disclosure laws applicable to such Receivable and sale thereof;
(xiv) Binding Obligation. Each Receivable
constitutes the legal, valid, and binding payment obligation in writing
of the Obligor, enforceable by the holder thereof in all material
respects in accordance with its terms, subject, as to enforcement, to
applicable bankruptcy, insolvency, reorganization, liquidation and
other similar laws and equitable principles relating to or affecting
the enforcement of creditors' rights;
(xv) No Government Obligor. Each
Receivable is not due from the United States of America or any State or
from any agency, department, instrumentality or political subdivision
of the United States of America or any State or local municipality, and
each Receivable is not due from a business except to the extent that
such Receivable has a personal guaranty;
(xvi) Security Interest in Financed Vehicle.
Immediately prior to the sale and assignment thereof to the Trustee as
herein contemplated, each Receivable was secured by a validly perfected
first priority security interest in
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the related Financed Vehicle in favor of or for the benefit of the
Seller as secured party (subject to administrative delays and clerical
errors on the part of the applicable governmental agency and to any
statutory or other lien arising by operation of law after the Closing
Date which is prior to such security interest), the Seller's security
interest (or beneficial interest therein) is assignable, and has been
so assigned by the Seller to the Trust, and at such time as enforcement
of such security interest is sought, each Receivable shall be secured
by a validly perfected first priority security interest in the related
Financed Vehicle for the benefit of the Trust (subject to
administrative delays and clerical errors on the part of the applicable
governmental agency and to any statutory or other lien arising by
operation of law after the Closing Date which is prior to such security
interest);
(xvii) Receivables in Force. No Receivable
has been satisfied, subordinated, or rescinded, nor has any Financed
Vehicle been released from the Lien granted by the related Receivable,
in whole or in part;
(xviii) No Waiver. No provision of a
Receivable has been waived in such a manner that such Receivable fails
either to meet all of the representations and warranties made by the
Seller herein with respect thereto or to meet all of the conditions
with respect thereto pursuant to this Section 3.1(b);
(xix) No Amendments. No Receivable has been
amended except pursuant to either instruments included in the
Receivable Files or instruments to be included in the Receivables Files
pursuant to Sections 4.2 and 4.4 (or otherwise maintained by the Seller
in the ordinary course of its business), and no such amendment has
caused such Receivable either to fail to meet all of the
representations and warranties made by the Seller herein with respect
thereto or to fail to meet all of the conditions with respect thereto
pursuant to this Section 3.1(b);
(xx) No Defenses. As of the Cutoff Date,
the Seller has no knowledge either of any facts which would give rise
to any right of rescission, setoff, counterclaim, or defense, or of the
same being asserted or threatened, with respect to any Receivable;
(xxi) No Liens. As of the Cutoff Date, the
Seller had no knowledge of any Liens or claims that have been filed,
including liens for work, labor, materials or unpaid taxes relating to
a Financed Vehicle, that would be liens prior to, or equal or
coordinate with, the lien granted by the Receivable;
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(xxii) No Default. Except for payment
defaults continuing for a period of not more than 30 days as of the
Cutoff Date, the Seller has no knowledge that a default, breach,
violation, or event permitting acceleration under the terms of any
Receivable exists; the Seller has no knowledge that a continuing
condition that with notice or lapse of time would constitute a default,
breach, violation, or event permitting acceleration under the terms of
any Receivable exists; and the Seller has not waived any of the
foregoing;
(xxiii) Insurance. Each Receivable requires
that the Obligor thereunder maintain comprehensive, liability, theft
and physical damage insurance covering the related Financed Vehicle;
(xxiv) Lawful Assignment. No Receivable has
been originated in, or is subject to the laws of, any jurisdiction
under which the sale, transfer, and assignment of such Receivable under
this Agreement or pursuant to transfers of the Certificates is
unlawful, void or voidable;
(xxv) All Filings Made. No filings (other
than filings under the Relevant UCC which have been made) or other
actions are necessary in any jurisdiction to give the Trustee a first
perfected security interest in the Receivables.
(xxvi) One Original. There is no more than
one original executed copy of each Receivable which, immediately prior
to the delivery thereof to the Servicer (as custodian for the Trustee)
was in the possession of the Seller;
(xxvii) Excluded Loans. Each Receivable (A)
is not a Receivable whose related Obligor resides in the State of
Alabama (in the case of a Direct Receivable) or a Receivable originated
by or through a Dealer located in the State of Alabama (in the case of
a Dealer Receivable), and (B) has not been the subject of a previous
securitization; and
(xxviii) Account Number. Each Dealer
Receivable has been assigned an account number that corresponds to the
number assigned to the Dealer from or through whom such Receivable was
acquired, and each Direct Receivable has been assigned an account
number that corresponds to the number assigned to the applicable
originating branch (or the "loan-by-phone" line).
SECTION 3.2. Repurchase Upon Breach or Failure of a
Condition. The Seller, the Servicer, or the Trustee, as the case
may be, shall inform the other parties promptly, in writing, upon
the discovery by the Seller, the Servicer or an Authorized
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Officer of the Trustee of either any breach of the Seller's representations and
warranties set forth in Section 3.1(a) or the failure of any Receivable to
satisfy any of the conditions set forth in Section 3.1(b) which materially and
adversely affects the Trust's interest in any Receivable. Unless the breach or
failed condition shall have been cured by the last day of the Collection Period
following the Collection Period in which such discovery occurred (or, at the
Seller's option, the last day of the Collection Period in which such discovery
occurred), the Seller shall repurchase any Receivable the Holders' interest in
which was materially and adversely affected by the breach or failed condition,
as of such last day. Notwithstanding anything herein to the contrary, with
respect to the breach of a representation and warranty in Section
3.1(b)(xxviii), the Seller shall repurchase such Receivable regardless of its
effect on the interest of the Holders in such Receivable or whether notice
thereof has been delivered by any of the parties thereto, and the repurchase of
any such Receivable shall take place at any time as is administratively
convenient for the Seller and the Servicer. In consideration of the repurchase
of a Receivable, the Seller shall remit the Repurchase Amount of such Receivable
as of such last day (less any Liquidation Proceeds deposited, or to be
deposited, by the Servicer in the Collection Account with respect to such
Receivable pursuant to Section 4.3) in the manner specified in Section 5.4. In
the event that, as of the Cutoff Date, any Receivable shall have a Contract Rate
which is lower than the sum of the Weighted Average Pass-Through Rate and the
Servicing Fee Rate, the Seller shall repurchase such Receivable on the terms and
in the manner specified above; provided, however, that notwithstanding anything
to the contrary contained herein, the Seller shall repurchase such Receivable as
of the last day of the Collection Period immediately succeeding the discovery
thereof by the Seller or the Servicer or the receipt by the Seller of notice
thereof from the Trustee. The sole remedy of the Trust, the Trustee or the
Certificateholders with respect either to a breach of the Seller's
representations and warranties set forth in Section 3.1(a) or to a failure of
any of the conditions set forth in Section 3.1(b) shall be to require the Seller
to repurchase Receivables pursuant to this Section 3.2. The obligation of the
Seller to repurchase under this Section 3.2 shall not be dependent upon the
actual knowledge of the Seller of any breached representation or warranty. The
Trustee shall have no duty to conduct any affirmative investigation as to the
occurrence of any condition requiring the repurchase of any Receivable pursuant
to this Section 3.2 or the eligibility of any Receivable for purposes of this
Agreement.
SECTION 3.3. Custody of Receivable Files. To assure uniform
quality in servicing the Receivables and to reduce administrative costs, the
Trustee, upon the execution and delivery of this Agreement, agrees to have the
Servicer act as custodian of the following documents or instruments (the
"Receivable Files") which are hereby constructively delivered to the Trustee
with respect to each Receivable:
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(i) The original executed Receivable; and
(ii) Any and all other documents or records
that the Seller or the Servicer, as the case may be, shall keep on
file, in accordance with its customary procedures, relating to a
Receivable, an Obligor, or a Financed Vehicle.
The Servicer hereby agrees to act as custodian and as agent
for the Trustee hereunder. The Servicer acknowledges that it holds the documents
and instruments relating to the Receivables for the benefit of the Trustee and
the Certificateholders. The Trustee shall have no responsibility to monitor the
Servicer's performance as custodian and shall have no liability in connection
with the Servicer's performance of such duties hereunder.
SECTION 3.4. Duties of Servicer as Custodian.
(a) Safekeeping. The Servicer, in its capacity
as custodian, shall hold the Receivable Files on behalf of the Trustee for the
use and benefit of all present and future Certificateholders and maintain such
accurate and complete accounts, records (either original execution documents or
copies of such originally executed documents shall be sufficient), and computer
systems pertaining to the Receivables as shall enable the Trustee to comply with
its obligations pursuant to this Agreement. In performing its duties as
custodian, the Servicer shall act with reasonable care, using that degree of
skill and attention that the Servicer exercises with respect to the receivable
files of comparable new or used automobile receivables that the Servicer
services for itself or others. The Servicer shall conduct, or cause to be
conducted, periodic audits of the files of all receivables owned or serviced by
the Servicer which shall include the Receivable Files held by it under this
Agreement and the related accounts, records, and computer systems, in such a
manner as shall enable the Trustee to identify all Receivable Files and such
related accounts, records and computer systems and to verify, if the Trustee so
elects, the accuracy of the Servicer's recordkeeping. The Servicer shall
promptly report to the Trustee any failure on its part to hold the Receivable
Files and maintain its accounts, records, and computer systems as herein
provided, and promptly take appropriate action to remedy any such failure.
(b) Maintenance of and Access to Records. The
Servicer shall maintain each Receivable File at one of the locations specified
in Schedule B to this Agreement, or at such other location as shall be specified
to the Trustee by 30 days' prior written notice. The Servicer shall make
available to the Trustee or its duly authorized representatives, attorneys, or
auditors the Receivable Files and the related accounts, records, and computer
systems maintained by the Servicer at such times during normal operating hours
as the Trustee shall reasonably
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instruct which does not unreasonably interfere with the Servicer's normal
operations or customer or employee relations.
(c) Release of Documents. Upon instruction from
the Trustee, the Servicer shall release any document in the Receivable Files to
the Trustee, the Trustee's agent, or the Trustee's designee, as the case may be,
at such place or places as such Person may reasonably designate as soon as
reasonably practicable to the extent it does not unreasonably interfere with the
Servicer's normal operations or customer or employee relations. The Servicer
shall not be responsible for any loss occasioned by the failure of the Trustee,
its agent or its designee to return any document or any delay in doing so.
(d) Title to Receivables. The Servicer agrees
that, in respect of any Receivable held by it as custodian hereunder, (i) the
Servicer will not at any time have or in any way attempt to assert any interest
in such Receivable or the related Receivable File, other than solely for the
purpose of collecting or enforcing the Receivable for the benefit of the Trust
and (ii) the related Receivable File shall at all times be property of the
Trust.
SECTION 3.5. Instructions; Authority to Act. The Servicer
shall be deemed to have received proper instructions with respect to the
Receivable Files upon its receipt of written instructions signed by an
Authorized Officer. A certified copy of a by-law or of a resolution of the Board
of Directors of the Trustee shall constitute conclusive evidence of the
authority of any such Authorized Officer to act and shall be considered in full
force and effect until receipt by the Servicer of written notice to the contrary
given by the Trustee.
SECTION 3.6. Custodian's Indemnification. The Servicer, as
custodian, shall indemnify the Trustee for any and all liabilities, obligations,
losses, damages, payments, costs, or expenses of any kind whatsoever that may be
imposed on, incurred, or asserted against the Trustee as the result of any act
or omission in any way relating to the maintenance and custody by the Servicer,
as custodian, of the Receivable Files; provided, however, that the Servicer
shall not be liable for any portion of any such amount resulting from the wilful
misfeasance, bad faith, or negligence of the Trustee.
SECTION 3.7. Effective Period and Termination. The
Servicer's appointment as custodian shall become effective as of the Cutoff Date
and shall continue in full force and effect until terminated pursuant to this
Section 3.7 or until this Agreement shall be terminated. If the Servicer shall
resign as Servicer under Section 8.5 or if all of the rights and obligations of
the Servicer shall have been terminated under Section 9.1, the appointment of
the Servicer as custodian may be terminated by the Trustee or by the Holders of
Certificates evidencing not less than 50% of the sum of the Class A Certificate
Balance and the
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Class B Certificate Balance voting as a single class, in the same manner as the
Trustee or such Holders may terminate the rights and obligations of the Servicer
under Section 9.1. As soon as practicable after any termination of such
appointment, the Servicer shall, at its expense, deliver the Receivable Files to
the Trustee or the Trustee's agent at such place or places as the Trustee may
reasonably designate. Notwithstanding the termination of the Servicer as
custodian, the Trustee agrees that upon any such termination, the Trustee shall
provide, or cause its agent to provide, access to the Receivables Files to the
Servicer for the purpose of carrying out its duties and responsibilities with
respect to the servicing of the Receivables hereunder.
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ARTICLE IV
ADMINISTRATION AND SERVICING OF RECEIVABLES
SECTION 4.1. Duties of Servicer. The Servicer shall manage,
service, administer and make collections on the Receivables (other than
Repurchased Receivables) with reasonable care, using that degree of skill and
attention that the Servicer exercises with respect to comparable new or used
automobile receivables that it services for itself. The Servicer's duties shall
include collection and posting of all payments, responding to inquiries by
Obligors or by federal, state, or local governmental authorities with respect to
the Receivables, investigating delinquencies, reporting tax information to
Obligors in accordance with its customary practices, advancing costs of
disposition of defaults, monitoring the Receivables in cases of Obligor
defaults, accounting for collections, furnishing monthly and annual statements
to the Trustee with respect to distributions, and, if it elects to do so, making
Advances pursuant to Section 5.3. The Servicer shall follow its customary
standards, policies, and procedures in performing its duties as Servicer
hereunder; provided that the Servicer shall be permitted to take or to refrain
from taking any action not specified in this Agreement with respect to servicing
the Receivables if such action or inaction would not contravene any material
term of this Agreement or materially adversely affect the interests of
Certificateholders. Without limiting the generality of the foregoing, the
Servicer shall be authorized and empowered by the Trustee to execute and
deliver, on behalf of itself, the Trust, the Trustee, the Certificateholders, or
any of them, any and all instruments of satisfaction or cancellation, or of
partial or full release or discharge, and all other comparable instruments,
without recourse to the Trustee with respect to the Receivables or with respect
to the Financed Vehicles. If the Servicer shall commence a legal proceeding to
enforce a Receivable or a Defaulted Receivable, the Trustee shall thereupon be
deemed to have automatically assigned such Receivable and the related property
conveyed to the Trust pursuant to Section 2.1 with respect to such Receivable to
the Servicer, solely for the purpose of collection. The Trustee shall furnish
the Servicer with such documents as have been prepared by the Servicer for
execution by the Trustee and as are necessary or appropriate to enable the
Servicer to carry out its servicing and administrative duties hereunder.
SECTION 4.2. Collection of Receivable Payments; Refinancing.
(a) The Servicer shall make reasonable efforts to collect all payments called
for under the terms and provisions of the Receivables and of this Agreement as
and when the same shall become due, and shall follow such collection procedures
as it follows with respect to comparable new or used automobile receivables that
it services for itself and that are consistent with prudent industry standards.
No extensions of, or other modifications to, the Receivables shall be made by
the Servicer
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if such modifications would have a material adverse effect on the interests of
Certificateholders. The Servicer shall not change the amount of (except with
respect to a prepayment of a scheduled payment that does not result in a
deferral of any other scheduled payment) or reschedule the due date of any
scheduled payment to a date more than 30 days from the original due date of such
scheduled payment, change the Contract Rate of, or extend any Receivable (except
as provided in Section 4.4) or change any material term of a Receivable, except
with respect to certain unilateral changes as provided by the terms of the
Receivable or of this Agreement or as required by law or court order; provided,
however, that the Servicer may grant extensions of the due date for a payment on
a Receivable that is in default or with respect to which, absent such extension,
default is reasonably foreseeable, and the Servicer would grant such extension
with respect to comparable new or used automobile receivables that it services
for itself, but such extension would be granted only if (i) the Available
Reserve Account Amount is greater than zero at the time of such extension, (ii)
the extension is for no more than three months, (iii) the total period of all
credit related extensions granted on the Receivable will not exceed the number
of months equal to the number of whole years comprising the original term of the
Receivable and (iv) the maturity of such Receivable would not be extended beyond
the Collection Period immediately preceding the Final Scheduled Distribution
Date and the rescheduling or extension would not modify the terms of such
Receivable in such a manner as to constitute a cancellation of such Receivable
and the creation of a new receivable for federal income tax purposes. If, as a
result of inadvertently rescheduling or extending of payments, such rescheduling
or extension breaches any of the terms of the proviso to the preceding sentence,
then the Servicer shall be obligated to purchase such Receivable pursuant to
Section 4.7. For the purpose of such purchases pursuant to Section 4.7, notice
shall be deemed to have been received by the Servicer at such time as shall make
any such purchase mandatory as of the last day of the Collection Period during
which the discovery of such breach shall have occurred. The Servicer may, in its
discretion, in accordance with its customary standards, policies and procedures,
waive any Late Fees that may be collected in the ordinary course of servicing a
Receivable.
(b) Notwithstanding anything in this Agreement to
the contrary, the Servicer may refinance any Receivable by accepting a new
promissory note from the related Obligor and applying the proceeds of such
refinancing to pay all obligations in full of such Obligor under such
Receivable; provided, however, that the Servicer shall not refinance a
Receivable unless at least one material term of the Receivable is substantively
changed. The receivable created by the refinancing shall not be property of the
Trust.
SECTION 4.3. Realization Upon Receivables. On behalf
of the Trust, the Servicer shall use reasonable efforts,
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consistent with its customary servicing procedures, to repossess or otherwise
take possession of the Financed Vehicle securing any Receivable which the
Servicer shall have determined to be a Defaulted Receivable or otherwise. The
Servicer shall follow such customary and usual practices and procedures as it
shall deem necessary or advisable in its servicing of new or used automobile
receivables, which may include reasonable efforts to realize upon any recourse
to Dealers, consigning the Financed Vehicle to a Dealer for resale and selling
the Financed Vehicle at public or private sale. The Servicer shall be entitled
to recover from proceeds all reasonable expenses incurred by it in the course of
converting the Financed Vehicle into cash proceeds. The Liquidation Proceeds
with respect to a Receivable shall be deposited by the Servicer in the
Collection Account in the manner specified in Section 5.2 and shall be applied
to reduce (or to satisfy, as the case may be) the Repurchase Amount of the
Receivable, if such Receivable is to be repurchased by the Seller pursuant to
Section 3.2, or is to be purchased by the Servicer pursuant to Section 4.7. The
foregoing shall be subject to the provision that, in any case in which a
Financed Vehicle shall have suffered damage, the Servicer shall not expend funds
in connection with the repair or the repossession of such Financed Vehicle
unless it shall determine in its sole discretion that such repair and/or
repossession will increase the Liquidation Proceeds of the related Receivable by
an amount equal to or greater than the amount of such expenses.
SECTION 4.4. Non-Credit Related Extensions to Obligors. Prior
to the Closing Date, the Servicer shall notify each Obligor in writing that if
such Obligor satisfies certain conditions, as fully set forth in clauses (i)
through (vii) below, as of a date selected by the Servicer within five (5)
months prior to the proposed extension, such Obligor shall be entitled to a
non-credit related extension of any regularly scheduled payment due under a
Receivable that satisfies clauses (w) through (z) below:
(i) either (A) if the original term to maturity of the
Receivable is less than or equal to 48 months, at least eight (8), or
(B) if the original term to maturity of the Receivable exceeds 48
months but is not greater than 60 months, at least ten, regular
monthly payments shall have been made on the related Receivable, and
the remaining outstanding Principal Balance of the related Receivable
shall be greater than $500;
(ii) the payment status is current;
(iii) such Obligor shall not within the previous six months
have been delinquent for thirty days or more in making a payment
under the related Receivable;
(iv) no information has been furnished to the Servicer which
indicates that, based upon its current
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underwriting guidelines and credit standards relating to advancing
funds under comparable retail installment sales contracts and purchase
money loans for new or used automobiles, the Obligor is not a Person to
whom the Servicer would advance funds;
(v) at least four (4) monthly payments are scheduled to be
made by the Obligor prior to final maturity
of the related Receivables;
(vi) the Receivable related to such optional extension shall
not have previously been the subject of more than two credit-related
extensions or the subject of any collection or bankruptcy-related
rewrites; and
(vii) after giving effect to such extension and the Obligor's
projected payments given the Obligor's payment history, the final
payment with respect to such Receivable would not exceed two (2) times
the original scheduled final payment amount of such Receivable.
In addition, any such extensions selected by an Obligor shall
satisfy the following criteria:
(w) a Receivable shall be extended for only the calendar
month of December;
(x) during the term of a Receivable, it shall be extended
only for the number of months equal to the number of whole years
comprising the initial term of such Receivable;
(y) no Receivable shall be extended such that its maturity
will be later than the Collection Period immediately preceding the
Final Scheduled Distribution Date; and
(z) the Obligor (or the related Receivable) shall have
satisfied conditions (i) through (vii) above.
If, as an inadvertent result of any extension granted pursuant
to this Section 4.4, such extension breaches any of the terms of the preceding
criteria (w) through (z), then the Servicer shall be obligated to purchase such
Receivable pursuant to Section 4.7. For the purpose of such purchases pursuant
to Section 4.7, notice shall be deemed to have been received by the Servicer at
such time as shall make purchase mandatory as of the last day of the Collection
Period during which the discovery of such breach shall have occurred.
SECTION 4.5. Maintenance of Security Interests in Financed
Vehicles. The Servicer, in accordance with its customary servicing procedures,
shall take such steps as are
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necessary to maintain perfection of the first priority security interest of the
Seller created in any Financed Vehicle which secures a Receivable. On behalf of
the Trust, the Servicer hereby agrees to take such steps as are necessary to
re-perfect such security interest in the event of the relocation of a Financed
Vehicle or for any other reason, in either case, when the Servicer has knowledge
of the need for such re-perfection. In the event that the assignment of a
Receivable to the Trust is insufficient without a notation on the related
Financed Vehicle's certificate of title, or without fulfilling any additional
administrative requirements under the laws of the State in which the Financed
Vehicle is located, to grant to the Trust a perfected security interest in the
related Financed Vehicle, the Servicer hereby agrees that the Seller's listing
as the secured party on the certificate of title is deemed to be in its capacity
as agent of the Trust and further agrees to hold such certificate of title as
the Trustee's agent and custodian; provided, however, that the Servicer shall
not, nor shall the Trustee or Certificateholders have the right to require that
the Servicer, make any such notation on the related Financed Vehicles'
certificate of title or fulfill any such additional administrative requirement
of the laws of the State in which a Financed Vehicle is located.
SECTION 4.6. Covenants of Servicer. The Servicer hereby makes
the following covenants on which the Trustee will rely in accepting the
Receivables in trust and authenticating the Certificates:
(i) Security Interest to Remain in Force.
The Financed Vehicle securing each Receivable shall not be released
from the security interest granted by the Receivable in whole or in
part except if such Financed Vehicle is substituted in whole by the
manufacturer, dealer or seller as a result of mechanical defects or a
total loss of the Financed Vehicle because of accident or theft or as
otherwise contemplated herein;
(ii) No Impairment. The Servicer shall not
impair the rights of the Trust in the Receivables; and
(iii) Extensions; Defaulted Receivables.
The Servicer shall not increase the number of payments under a
Receivable, nor increase the Amount Financed under a Receivable, nor
extend or forgive payments on a Receivable, except as provided in
Sections 4.2 and 4.4. In the event that at the end of the scheduled
term of any Receivable, the outstanding principal amount thereof is
such that the final payment to be made by the related Obligor is larger
than the regularly scheduled payment of principal and interest made by
such Obligor, the Servicer may permit such Obligor to pay such
remaining principal amount in more than one payment of principal and
interest; provided, however, that the last such payment shall be due on
or prior to the Collection
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Period immediately preceding the Final Scheduled
Distribution Date.
SECTION 4.7. Purchase of Receivables Upon Breach. The
Seller, the Servicer or the Trustee, as the case may be, shall inform the
other parties promptly, in writing, upon the discovery by the Seller, the
Servicer or an Authorized Officer of the Trustee, as the case may be, of any
breach by the Servicer of its covenants under Section 4.6 which materially and
adversely affects the interest of the Trust in any Receivable (for this
purpose, any breach of the covenant set forth in Section 4.6(iii) shall be
deemed to materially and adversely affect the interest of the Trust in a
Receivable). Except as otherwise specified in Sections 4.2 or 4.4, unless
the breach shall have been cured by the last day of the Collection Period
following the Collection Period in which such discovery occurred (or, at the
Servicer's election, the last day of the Collection Period in which such
discovery occurred), the Servicer shall purchase any Receivable materially and
adversely affected by such breach, as of such last day. In consideration of
the purchase of such Receivable, the Servicer shall remit the Repurchase
Amount (less any Liquidation Proceeds deposited, or to be deposited, by the
Servicer in the Collection Account with respect to such Receivable pursuant to
Section 4.3) in the manner specified in Section 5.4. The sole remedy of the
Trust, the Trustee, or the Certificateholders against the Servicer with
respect to a breach pursuant to Section 4.2 or 4.6 shall be to require the
Servicer to purchase Receivables pursuant to this Section 4.7. The Trustee
shall have no duty to conduct any affirmative investigation as to the
occurrence of any condition requiring the repurchase of any Receivable
pursuant to this Section 4.7 or the eligibility of any Receivable for purposes
of this Agreement.
SECTION 4.8. Servicing Fee. The Servicing Fee for a Collection
Period shall be payable on the related Distribution Date pursuant to Section 5.5
and shall equal the sum of (i) the product of one-twelfth of the Servicing Fee
Rate and the Pool Balance as of the related Settlement Date and (ii) Late Fees
received from Obligors during such Collection Period. In addition, as part of
the Servicing Fee, the Servicer shall be entitled to receive on each
Distribution Date Investment Earnings when and as paid on amounts on deposit in
the Collection Account or earned on collections pending deposit in the
Collection Account; provided, however, that, beginning with the Collection
Period for which the Trustee is notified in writing that the Servicer has failed
to deposit an Advance with respect to a Receivable (other than because such
Receivable has been designated a Defaulted Receivable) and continuing until the
Final Scheduled Distribution Date, such Investment Earnings shall not be paid to
the Servicer, but shall be deposited by the Trustee or the Paying Agent on its
behalf into the Reserve Account on each Distribution Date. The Servicer shall be
required to pay from its own account all expenses incurred by it in connection
with its activities hereunder (including fees and disbursements of
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independent accountants and auditors, taxes imposed on the Servicer, and other
costs incurred in connection with administering and servicing the Receivables)
and the fees and disbursements of the Trustee, the Collateral Agent, the
Trustee's and the Collateral Agent's counsel, the Paying Agent, the Transfer
Agent and Certificate Registrar except for United States federal, state and
local income and franchise taxes, if any, imposed on the Trust or any
Certificateholder or any expenses in connection with realizing upon Receivables
under Section 4.3.
SECTION 4.9. Servicer's Certificate. On or before each
Determination Date, the Servicer shall deliver to the Trustee, the Collateral
Agent, the Paying Agent and the Rating Agencies a Servicer's Certificate
substantially in the form of Exhibit D hereto, for the Collection Period
preceding such Determination Date, containing all information necessary to make
the distributions pursuant to Section 5.5, and all information necessary for the
Paying Agent to send statements to Certificateholders pursuant to Section 5.8.
The Servicer shall deliver to the Rating Agencies any information, to the extent
it is available to the Servicer, that the Rating Agencies reasonably request in
order to monitor the Trust. The Servicer shall also specify each Receivable
which the Seller or the Servicer is required to repurchase or purchase, as the
case may be, as of the last day of the preceding Collection Period or as of the
related Settlement Date, as applicable, each Receivable which the Servicer shall
have determined to be a Defaulted Receivable during the preceding Collection
Period, and each Receivable for which the Servicer has failed to deposit an
Advance pursuant to Section 5.3 other than because such Receivable has been
designated a Defaulted Receivable. Subsequent to the Closing Date, the form of
Servicer's Certificate may be revised or modified to cure any ambiguities or
inconsistencies between such form and this Agreement; provided, however, that no
material information shall be deleted from the form of Servicer's Certificate.
In the event that the form of Servicer's Certificate is revised or modified in
accordance with the preceding sentence, a form thereof, as so revised or
modified, shall be provided to the Trustee, the Collateral Agent, the Paying
Agent and each Rating Agency.
SECTION 4.10.Annual Statement as to Compliance. (a) The
Servicer shall deliver to a firm of independent certified public accountants, on
or before March 31 of each year commencing March 31, ____, a certificate signed
by the chairman of the board, the president, the treasurer, the controller, any
executive or senior vice president or any vice president of the Servicer,
stating that (a) a review of the activities of the Servicer during the year
ended the preceding December 31 (or period since the Cutoff Date in the case of
the first such certificate) and of its performance under this Agreement has been
made under such officer's supervision and (b) to the best of such officer's
knowledge, based on such review, the Servicer has fulfilled all its obligations
in all material respects under this
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Agreement throughout such year (or shorter period in the case of the first such
certificate), or, if there has been a default in the fulfillment of any such
obligation, specifying each such default known to such officer and the nature
and status thereof.
(b) The Servicer shall deliver to the Trustee and each Rating
Agency promptly after having obtained knowledge thereof, but in no event later
than five Business Days thereafter, an Officer's Certificate specifying any
event which with the giving of notice or lapse of time, or both, would become an
Event of Servicing Termination under Section 9.1. The Seller shall deliver to
the Trustee, promptly after having obtained knowledge thereof, but in no event
later than five Business Days thereafter, an Officer's Certificate specifying
any event which with the giving of notice or lapse of time, or both, would
become an Event of Servicing Termination under Section 9.1.
SECTION 4.11. Annual Audit Report. The Servicer shall cause a
firm of independent public accountants (which may provide other services to the
Servicer or the Seller) to prepare a report (with a copy of the certificate
described in Section 4.10(a) attached) addressed to the Board of Directors of
the Servicer, for the information and use of the Trustee and the Rating Agencies
on or before March 31 of each year, beginning March 31, ____, to the effect
that, with respect to the twelve months (or period since the Cutoff Date in the
case of the first such report) ended the preceding December 31, such firm has
either (A) examined a written assertion by the Servicer about the effectiveness
of the Servicer's internal control structure over the processing and reporting
of transactions relating to securitized automobile loans with respect to the
criteria set forth by the Servicer (the "Assertion") and that, on the basis of
such examination, such firm is of the opinion that the Servicer's Assertion is
fairly stated in all material respects except for (i) such exceptions as such
firm believes to be immaterial and (ii) such other exceptions as shall be set
forth in such firm's report, or (B) such firm has performed the following
procedures:
1. For a sample of daily cash receipts during the preceding
calendar year:
a. Trace total cash receipts to deposits on bank
statements.
b. Agree cash receipts for securitized loans to computer
reports.
c. Trace cash receipts for securitized loans to
disbursements to the Trustee.
2. For a sample of monthly cash receipt reports:
a. Agree total cash receipts per the cash receipt reports to
"Total Payments From Obligors Applied to Collection Period"
per monthly Servicer Certificates.
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b. Agree total principal payments per the cash receipt
reports to "Principal Payments" per monthly Servicer
Certificates.
3. For a sample of loans delinquent 30 days or more and for a sample of
loans in repossession status, selected from the loan delinquency report
or a new repossession report, as applicable, at a point in time, trace
loan number to inclusion in the loan collection system.
The determination of which of the two alternative reports to be prepared and
delivered, and the size of each sample to be tested, shall be decided in the
sole discretion of the Servicer. The report of the independent certified public
accountants shall also indicate that such accounting firm is independent of the
Servicer within the meaning of the Code of Professional Ethics of the American
Institute of Certified Public Accountants.
SECTION 4.12. Access by Certificateholders to Certain
Documentation and Information Regarding Receivables. The Servicer shall provide
to the Certificateholders access to the Receivable Files in such cases where the
Certificateholders shall be required by applicable statutes or regulations to
have access to such documentation. Access by the Certificateholders shall be
afforded without charge, but only upon reasonable request and during normal
business hours which does not unreasonably interfere with the Servicer's normal
operations or customer or employee relations. Nothing in this Section 4.12 shall
affect the obligation of the Servicer to observe any applicable law prohibiting
disclosure of information regarding the Obligors, and the failure of the
Servicer to provide access to information as a result of such obligation shall
not constitute a breach of this Section 4.12.
SECTION 4.13. Reports to Certificateholders and the Rating
Agencies. (a) The Trustee shall provide to any Certificateholder who so requests
in writing (addressed to the Corporate Trust Office) a copy of any Servicer's
Certificate described in Section 4.9, of the annual statement described in
Section 4.10(a), or the annual report described in Section 4.11. The Trustee may
require the Certificateholder to pay a reasonable sum to cover the cost of the
Trustee's complying with such request.
(b) The Trustee shall forward to the Rating Agencies the
statement to Certificateholders described in Section 5.8 and any other reports
it may receive pursuant to this Agreement [(i) to Standard & Poor's Ratings
Services, Asset-Backed Surveillance Group, 25 Broadway, New York, New York
10004, (ii) to Moody's Investors Service, Inc., ABS Monitoring Dept., 99 Church
Street, 4th Floor, New York, New York 10007 and (iii) to Fitch Investors
Services, L.P., One State Street Plaza, 32nd Floor, New York, New York 10004].
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SECTION 4.14. Reports to the Securities and Exchange
Commission. The Servicer shall, on behalf of the Trust, cause to be filed with
the Commission any periodic reports required to be filed under the provisions of
the Exchange Act and the rules and regulations of the Securities and Exchange
Commission thereunder.
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ARTICLE V
ACCOUNTS; DISTRIBUTIONS; STATEMENTS TO
CERTIFICATEHOLDERS
SECTION 5.1. Establishment of the Accounts. (a) The
Servicer shall establish and maintain:
(i) the Collection Account in the name of the
Trustee bearing a designation clearly indicating
that the funds deposited therein are held for
the benefit of the Certificateholders;
(ii) the Class A Distribution Account in the name of
the Trustee bearing a designation clearly
indicating that the funds deposited therein are
held for the benefit of the Class A
Certificateholders; and
(iii) the Class B Distribution Account in the name of
the Trustee bearing a designation clearly
indicating that the funds deposited therein are
held for the benefit of the Class B
Certificateholders.
Each Account shall be an Eligible Deposit Account established
initially at Chase.
(b) The Trustee shall possess all right, title and interest in
all funds on deposit from time to time in the Accounts (excluding the Seller's
interest in the Retained Yield) and in all proceeds thereof (excluding
Investment Earnings) and all such funds shall be part of the property of the
Trust. The Accounts shall be under the sole dominion and control of the Trustee.
Should any depositary of an Account (including Chase (or an Affiliate thereof))
cease to be either a Qualified Institution or a Qualified Trust Institution, as
applicable, then the Servicer shall, with the Seller's assistance as necessary,
cause the related Account to be moved to a Qualified Institution or a Qualified
Trust Institution, unless the Rating Agency Condition is satisfied in connection
with such depositary's ceasing to be a Qualified Institution or a Qualified
Trust Institution, as the case may be.
All amounts held in the Collection Account shall be invested
by the bank or trust company then maintaining the account (at the written
direction of the Servicer or, if Investment Earnings on amounts on deposit in
the Collection Account are not being paid to the Servicer, the Seller) in
Permitted Investments that mature not later than the Deposit Date next
succeeding the date of investment except, if the Collection Account is
maintained with the Trustee, for investments on which the Trustee is the obligor
(including repurchase agreements on which the Trustee in its commercial capacity
is liable as
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principal), which investments may mature on the next succeeding Distribution
Date; provided, however, that once such amounts have been invested by such bank
or trust company, as applicable, in Permitted Investments, such Permitted
Investments must be held or maintained until they mature on or before the dates
described above. Amounts on deposit in the Reserve Account will be distributed
in the manner set forth in Section 5.5.
SECTION 5.2. Collections. (a) The Servicer shall remit daily
within forty-eight hours of receipt to the Collection Account all payments by or
on behalf of the Obligors on the Receivables and all Liquidation Proceeds
(including any Retained Yield), both as collected during the Collection Period.
Chase USA has requested that, so long as it is acting as the Servicer, the
Servicer be permitted to make remittances of collections on a less frequent
basis than that specified in the immediately preceding sentence. It is
understood that such less frequent remittances may be made only on the specific
terms and conditions set forth below in this Section 5.2 and only for so long as
such terms and conditions are fulfilled. Accordingly, notwithstanding the
provisions of the first sentence of this Section 5.2, the Servicer shall remit
such collections to the Collection Account in Automated Clearinghouse
Corporation next-day funds or immediately available funds no later than 11:00
a.m., New York City time, on the Deposit Date but only for so long as (i) the
short-term certificate of deposit or debt ratings of the Servicer are at least
"P-1" by Moody's, "F-1" by Fitch (if rated by Fitch) and "A-1" by Standard &
Poor's or the Rating Agency Condition is satisfied as a result of Collections
being remitted on a monthly, rather than daily, basis and (ii) the Servicer
shall be Chase USA or Chase. Upon remittance by the Servicer of Collections to
the Collection Account pursuant to the preceding sentence, the Paying Agent
shall provide written notice to the Trustee no later than 11 a.m., New York City
time, on each Deposit Date setting forth the amounts remitted by the Servicer on
such date and, if the Paying Agent fails to provide the Trustee with such
written notice by 12 noon, New York City time, on such Deposit Date, then the
Trustee shall assume that no deposits were made to the Collection Account
pursuant to this Section 5.2 and shall withdraw any amount required from the
Reserve Account for deposit into the Collection Account pursuant to Section 5.6.
For purposes of this Section 5.2 the phrase "payments made on behalf of the
Obligors" shall mean payments made by Persons other than the Seller or the
Servicer. Investment Earnings on amounts on deposit in the Collection Account
will be paid to the Servicer or deposited into the Reserve Account in accordance
with Section 4.8.
(b) Notwithstanding anything in this Agreement to the
contrary, if the Servicer inadvertently deposits amounts that it mistakenly
believes are Collections resulting in the payment in full of a Receivable into
the Collection Account and (i) the Servicer discovers its error prior to the
Distribution Date following such deposit, the Trustee, at the written direction
of
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the Servicer, shall withdraw such amounts and pay them to the Servicer or (ii)
if the Servicer discovers its error on or after the Distribution Date following
such deposit, the Servicer shall be deemed to have purchased such Receivable
pursuant to Section 4.7 as of the last day of the Collection Period during which
such error shall have occurred.
SECTION 5.3. Advances. (a) As of the Business Day preceding
the related Distribution Date, the Servicer may, in its sole discretion, make a
payment with respect to each Receivable (other than a Defaulted Receivable)
equal to the excess, if any, of (x) the product of the Principal Balance of such
Receivable as of the related Settlement Date and one-twelfth of the Contract
Rate for such Receivable, over (y) the interest actually received by the
Servicer with respect to such Receivable from the Obligor or from payments of
the Repurchase Amount during or with respect to such Collection Period. The
Servicer shall deposit all such Advances into the Collection Account in
Automated Clearinghouse Corporation next-day funds or immediately available
funds no later than 11 a.m., New York City time, on the Deposit Date. The
Servicer may elect not to make any Advance with respect to a Receivable to the
extent that the Servicer, in its sole discretion, shall determine that such
Advance is not recoverable from subsequent payments on such Receivable or from
funds in the Reserve Account. To the extent that the amount set forth in clause
(y) above with respect to a Receivable during or with respect to a Collection
Period plus any amounts withdrawn from the Reserve Account during or with
respect to such Collection Period and allocable to interest with respect to such
Receivable is greater than the amount set forth in clause (x) above with respect
thereto, such amount shall be distributed to the Servicer on the related
Distribution Date pursuant to Section 5.5(a); provided, however, that,
notwithstanding anything else herein, until a Receivable becomes a Defaulted
Receivable, the Servicer shall be reimbursed for any Advance made with respect
to a Receivable only from accrued interest paid from the Obligor under such
Receivable.
(b) On each Deposit Date, the Trustee shall demand a
withdrawal from the Reserve Account in an amount, not to exceed the Available
Reserve Account Amount for such Distribution Date, equal to the amount of all
outstanding Advances with respect to all Receivables that become Defaulted
Receivables during the immediately preceding Collection Period (to the extent
not recovered from Liquidation Proceeds) and shall deposit such amount into the
Collection Account, in Automated Clearinghouse Corporation next-day funds or
immediately available funds, no later than 11 a.m., New York City time, on such
Deposit Date. Such amounts shall be distributed to the Servicer on the related
Distribution Date pursuant to Section 5.5(a).
(c) On each Deposit Date, the Paying Agent shall provide
written notice to the Trustee setting forth the amount, if any, of Advances
deposited by the Servicer in the Collection
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Account no later than 11 a.m., New York City time, on such Deposit Date and, if
the Paying Agent fails to provide the Trustee with such written notice by 12
noon, New York City time, on such Deposit Date, then the Trustee shall assume
that no Advances were deposited to the Collection Account pursuant to this
Section 5.3.
SECTION 5.4. Additional Deposits. The Servicer, or the Seller,
as the case may be, shall deposit into the Collection Account the aggregate
Repurchase Amount pursuant to Sections 3.2, 4.7 and 11.2, as applicable. All
remittances shall be made to the Collection Account, in Automated Clearinghouse
Corporation next-day funds or immediately available funds, no later than 11
a.m., New York City time, on the Deposit Date.
SECTION 5.5. Distributions. Not later than 11:00 a.m., New
York City time, on each Distribution Date, at the Servicer's direction, the
Trustee, or the Paying Agent on behalf of the Trustee, shall cause to be made
the following distributions, to the extent of the Total Distribution Amount then
on deposit in the Collection Account and amounts withdrawn from the Reserve
Account and deposited in the Collection Account by wire transfer of immediately
available funds, in the following order of priority and in the amounts set forth
in the Servicer's Certificate for such Distribution Date:
(a) to the Servicer, by wire transfer of immediately
available funds, in reimbursement of Advances from amounts on deposit in the
Collection Account allocable to interest under the Receivables or from
withdrawals from the Reserve Account (including an amount equal to the accrued
interest on Defaulted Receivables and Repurchased Receivables to the extent
available in the Collection Account), the amount payable to the Servicer
pursuant to Section 5.3;
(b) to the extent of the sum of Available Interest (after
reimbursement of Advances pursuant to Section 5.5(a)) and any Available Reserve
Account Amount remaining after any withdrawal from the Reserve Account in
respect of Advances pursuant to Section 5.3(b) on the related Deposit Date (and,
in the case of shortfalls occurring under clause (ii) below in the Class A
Interest Distributable Amount, the Class B Percentage of Available Principal to
the extent of such shortfalls), in the following priority:
(i) to the Servicer, any unpaid Servicing Fee for the
preceding Collection Period, plus the amount of any Servicing
Fee previously due but not paid, if any, to the extent such
amounts are not deducted from the Servicer's remittance to the
Collection Account pursuant to Section 5.7;
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(ii) to the Class A Distribution Account, the
Class A Interest Distributable Amount for such
Distribution Date; and
(iii) to the Class B Distribution Account, the
Class B Interest Distributable Amount for such
Distribution Date.
(c) to the extent of the portion of Available Principal,
Available Interest (after reimbursement of Advances pursuant to Section 5.5(a))
and any Available Reserve Account Amount (after any withdrawal pursuant to
Section 5.3(b) on the related Deposit Date) remaining after the application of
clause (b) above, in the following priority:
(i) to the Class A Distribution Account, the
Class A Principal Distributable Amount for such
Distribution Date;
(ii) to the Class B Distribution Account, the
Class B Principal Distributable Amount for such
Distribution Date; and
(iii) to the Collateral Agent for deposit in the
Reserve Account, any remaining amounts.
(d) On each Distribution Date, the Trustee or the
Paying Agent, as the case may be, will distribute all amounts on deposit in the
Class A Distribution Account to the Class A Certificateholders as of the Record
Date and all amounts on deposit in the Class B Distribution Account to the Class
B Certificateholders as of the Record Date. Amounts distributed from the
Distribution Accounts shall be paid to the related Certificateholders of record,
as of the related Record Date, by check mailed by the Paying Agent (or, if
directed by the Seller in the case of the certificates registered in the name of
the Clearing Agency, by wire transfer of immediately available funds). To the
extent that the Paying Agent wires funds to a Clearing Agency from the
Collection Account, the Paying Agent will request the Seller, the Qualified
Institution or the Qualified Trust Institution then maintaining the Collection
Account to make such wire distribution and the Seller, the Qualified Institution
or the Qualified Trust Institution then maintaining the Collection Account shall
promptly deliver to the Paying Agent a confirmation of such wire distribution.
The Paying Agent shall have no liability in connection with any failure by the
Seller, the Qualified Institution or the Qualified Trust Institution to make
such distribution.
SECTION 5.6. Reserve Account; Assignment of Retained
Yield to Collateral Agent. (a) The Seller shall establish and
maintain an Eligible Deposit Account (the "Reserve Account") at
[_______________________________________], in the name of
[_______________________________________], as Collateral Agent
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for the benefit of the Certificateholders. The Reserve Account
shall not be property of the Trust.
(b) On the Closing Date, the Seller shall deposit the Reserve
Account Initial Deposit into the Reserve Account. The Seller hereby grants to
the Collateral Agent for the benefit of the Certificateholders all of its right,
title and interest in and to the Retained Yield and the Reserve Account and any
and all property credited thereto from time to time, including, but not limited
to, Permitted Investments, to secure the payment of all amounts due and owing to
the Certificateholders hereunder. By acceptance of their Certificates,
Certificateholders shall be deemed to have appointed
[_______________________________], as Collateral Agent with respect to the
Reserve Account and the Retained Yield.
[_______________________________________] hereby accepts such appointment as
Collateral Agent with respect to the Reserve Account and the Retained Yield.
(c) The Reserve Account shall be under the sole dominion and
control of the Collateral Agent, and the Collateral Agent shall have signature
authority with respect thereto. Should any sole depositary of the Reserve
Account cease to be either a Qualified Institution or a Qualified Trust
Institution, the Seller shall cause the Reserve Account to be moved to a
Qualified Institution or a Qualified Trust Institution, as applicable, unless
the Seller provides the Trustee with a letter from the Rating Agencies to the
effect that the Rating Agency Conditions will be satisfied in connection with
such depositary's ceasing to be a Qualified Institution or a Qualified Trust
Institution, as the case may be.
All amounts held in the Reserve Account shall be invested by
the bank or trust company then maintaining the account (at the written direction
of the Seller) in Permitted Investments that mature not later than the Deposit
Date next succeeding the date of investment, except if the Reserve Account is
maintained with the Trustee, for investments on which the Trustee is the obligor
(including repurchase agreements on which the Trustee in its commercial capacity
is liable as principal), which investments may mature on the next succeeding
Distribution Date; provided, however, that amounts on deposit in the Reserve
Account may be invested in Permitted Investments that mature later than the next
succeeding Deposit Date if the Rating Agency Condition is satisfied.
(d) With respect to the Reserve Account Property:
(i) any Reserve Account Property that constitutes
Physical Property shall be delivered to the Collateral Agent
in accordance with paragraph (a) of the definition of
"Delivery" and shall be held by the Collateral Agent, pending
maturity or disposition;
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(ii) any Reserve Account Property that is a United
States Security Entitlement held through the Federal Reserve
System pursuant to Federal book-entry regulations shall be
delivered in accordance with paragraph (b) of the definition
of "Delivery" and shall be maintained by the Collateral Agent,
pending maturity or disposition; and
(iii) any Reserve Account Property that is an
"uncertificated security" under Article 8 (or VIII, as
applicable) of the Relevant UCC and that is not governed by
clause (ii) above shall be delivered to the Collateral Agent
in accordance with paragraph (c) of the definition of
"Delivery" and shall be maintained by the Collateral Agent,
pending maturity or disposition.
The Collateral Agent shall, at the expense of the Servicer, take such action as
is required in writing by the Trustee to maintain the security interest of the
Collateral Agent in any Reserve Account Property as a perfected security
interest under the Relevant UCC; provided, however, that the Collateral Agent
shall not be required to prepare or file any financing statements or
continuation statements and that the Collateral Agent and Trustee may rely upon
the written instructions of the Servicer as to the method by which the security
interest of the Collateral Agent may be perfected. Upon written request from the
Trustee or Collateral Agent, the Servicer shall provide such instructions and an
opinion of counsel with respect to the method of perfecting such security
interest; provided, however, that the Servicer shall not be obligated to deliver
to the Collateral Agent or the Trustee an opinion of counsel with respect to the
method of perfecting a security interest in any Permitted Investment the method
of perfecting a security interest in which was described in that certain legal
opinion of _________________ ____________, special local counsel to the
Collateral Agent, dated __________ __, ____, unless there has been change in law
or the interpretation thereof from the date of such opinion with respect to the
method of perfecting a security interest in such Permitted Investment.
(e) On each Distribution Date, the Collateral Agent shall
withdraw from the Reserve Account and pay to the Seller any Investment Earnings
with respect to amounts on deposit in the Reserve Account and, subject to
Sections 8.4 and 10.7, an amount equal to the excess, if any, of the amount on
deposit in the Reserve Account over the Specified Reserve Account Balance with
respect to such Distribution Date (after giving effect to all deposits therein
or withdrawals therefrom on such Distribution Date). Upon any distribution to
the Seller of amounts from the Reserve Account, neither the Holders nor the
Collateral Agent will have any rights in, or claims, to, such amounts. Amounts
properly distributed to the Seller from the Reserve Account shall not be
available under any circumstances to the Trustee, the
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Collateral Agent, and the Seller shall not in any event thereafter be required
to refund any such distributed amounts.
(f) On each Deposit Date, the Trustee shall demand a
withdrawal from the Reserve Account, in an amount not to exceed the Available
Reserve Account Amount (after withdrawals from the Reserve Account on the
related Deposit Date pursuant to Section 5.3(b)), equal to the sum of the
excess, if any, of the sum of (i) the Class A Interest Distributable Amount,
Class A Principal Distributable Amount, Class B Interest Distributable Amount
and Class B Principal Distributable Amount, in each case for the Distribution
Date, and the Servicing Fee payable to the Servicer on such Distribution Date,
over (ii) the sum of the Available Interest (after reimbursement of Advances
pursuant to Section 5.5(a)) and Available Principal, in each case for such
Distribution Date. The Trustee shall deposit the amount withdrawn from the
Reserve Account in the Collection Account for application pursuant to Section
5.5.
SECTION 5.7. Net Deposits. Chase USA. (in its capacity as the
Seller or the Servicer) may make the remittances pursuant to Section 5.2 and
Section 5.4 above, net of amounts to be retained by it or distributed to it
(also in any such capacity) pursuant to Section 4.8 (if applicable) and Section
5.5, if (a) it shall be the Servicer and (b) it is entitled, pursuant to Section
5.2, to make deposits on a monthly basis, rather than a daily basis.
Nonetheless, the Servicer shall account for all of the above described amounts
as if such amounts were deposited and distributed separately.
SECTION 5.8. Statements to Certificateholders. On each
Distribution Date, the Servicer shall prepare and furnish to the Trustee and the
Paying Agent, and the Paying Agent shall include with the distribution to each
Certificateholder a statement substantially in the form of Exhibit E, based on
information in the certificate furnished pursuant to Section 4.9, setting forth
for the Collection Period the following information (which in the case of items
(i), (ii) and (iii) shall be expressed in the aggregate and as a dollar amount
per $1,000 of the original principal balance of a Certificate):
(i) the amount of such distribution
allocable to principal on the Class A Certificates and the
Class B Certificates;
(ii) the amount of such distribution
allocable to interest on the Class A Certificates and the Class B
Certificates (specifying specifically the amount of any Class B
Stripped Coupon included therein);
(iii) the amount of the Servicing Fee paid
to the Servicer pursuant to Section 5.5(c);
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(iv) the Class A Certificate Balance, the
Class A Pool Factor, the Class B Certificate Balance and the Class B
Pool Factor as of such Distribution Date, in each case after giving
effect to payments allocated to principal reported pursuant to clause
(i);
(v) the Pool Balance as of the last day
of the preceding Collection Period;
(vi) the amount of the Aggregate Net
Losses, if any, for such Distribution Date.
(vii) the Class A Interest Carryover
Shortfall, the Class B Interest Carryover Shortfall, the
Class A Principal Carryover Shortfall and the Class B
Principal Carryover Shortfall, if any, for such Distribution
Date;
(viii) the balance of the Reserve Account
on such Distribution Date, after giving effect to changes therein on
such Distribution Date and the amounts deposited into and withdrawn
from the Reserve Account on such Distribution Date;
(ix) the Specified Reserve Account
Balance as of such Distribution Date;
(x) the aggregate Repurchase Amount of
Receivables repurchased by the Seller or purchased by the
Servicer during such Collection Period; and
(xi) the aggregate unreimbursed Advances
as of such Distribution Date and the change in such amount from the
previous Distribution Date and the amount of Advances reimbursed on
such Distribution Date from collections and Liquidation Proceeds and
from withdrawals from the Reserve Account.
Within a reasonable period of time after the end of each
calendar year, but not later than the latest date permitted by law, the Servicer
shall prepare and furnish to the Trustee and the Paying Agent, and the Paying
Agent shall furnish, to each Person who at any time during such calendar year
shall have been a Certificateholder for the purposes of such Certificateholder's
preparation of federal income tax returns, a statement setting forth the sum of
the amounts determined in clauses (i) through (iii) for such calendar year.
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ARTICLE VI
THE CERTIFICATES
SECTION 6.1. The Certificates. Unless otherwise specified in
this Agreement, the Certificates of each class shall be issued in denominations
of $1,000 and integral multiples thereof; provided, however, that one Class A
Certificate and one Class B Certificate may be issued in a denomination that
represents a residual portion of the Original Class A Certificate Balance and
the Original Class B Certificate Balance, respectively. Upon initial issuance on
the Closing Date, the Class A Certificates and the Class B Certificates shall be
in the form of Exhibit A-1 and Exhibit A-2, respectively, which are incorporated
by reference, and shall be issued as provided in Section 6.8 in an aggregate
amount equal to the Original Class A Certificate Balance and the Original Class
B Certificate Balance, respectively. The Certificates shall be executed on
behalf of the Trust by manual or facsimile signature of an Authorized Officer or
other authorized signatory of the Trustee. Certificates bearing the manual or
facsimile signatures of individuals who were, at the time when such signatures
shall have been affixed, authorized to sign on behalf of the Trust, shall be
valid and binding obligations of the Trust, notwithstanding that such
individuals shall have ceased to be so authorized prior to the execution,
authentication and delivery of such Certificates or did not hold such offices or
positions at the date of such Certificates. No Certificate shall entitle the
Holder to any benefit under this Agreement, or shall be valid for any purpose,
unless there shall appear on such Certificate an authentication substantially in
the form set forth in Exhibit A-1 or A-2 hereto as applicable, executed by the
Trustee by manual or facsimile signature; such authentication shall constitute
conclusive evidence that such Certificate has been duly authenticated and
delivered hereunder. All Certificates shall be dated the date of their
authentication. A transferee of a Certificate shall become a Certificateholder,
and shall be entitled to the rights and subject to the obligations of a
Certificateholder hereunder, upon due presentment of such Certificate in such
transferee's name pursuant to Section 6.5.
SECTION 6.2. Execution, Authentication and Delivery of
Certificates. The Trustee shall deliver to, or upon the order of, the Seller, in
exchange for the Receivables, the other assets of the Trust and the pledge of
the Reserve Account and amounts on deposit therein and the Retained Yield,
simultaneously with the sale, assignment and transfer to the Trustee of the
Receivables, the constructive delivery to the Trustee of the Receivable Files
and the delivery to the Trustee of the other components of the Trust,
Certificates duly executed by the Trustee, on behalf of the Trust, and
authenticated by the Trustee in authorized denominations equaling in the
aggregate the Original Pool Balance, and evidencing the entire ownership of the
Trust.
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SECTION 6.3. Registration of Transfer and Exchange of
Certificates.
(a) The Trustee shall cause to be kept at the
office or agency to be maintained by a transfer agent and certificate registrar
(the "Transfer Agent and Certificate Registrar"), in accordance with the
provisions of Section 6.7, a register (the "Certificate Register") in which,
subject to such reasonable regulations as it may prescribe, the Transfer Agent
and Certificate Registrar shall provide for the registration of Certificates and
of transfers and exchanges of Certificates as herein provided. The corporate
trust office of Chase is hereby initially appointed Transfer Agent and
Certificate Registrar for the purpose of registering Certificates and transfers
and exchanges of Certificates as herein provided. In the event that, subsequent
to the date of issuance of the Certificates, Chase notifies the Trustee that it
is unable to act as Transfer Agent and Certificate Registrar, the Trustee shall
act, or the Trustee shall, with the consent of the Seller, appoint another bank
or trust company, having an office or agency located in The City of New York and
which agrees to act in accordance with the provisions of this Agreement
applicable to it, to act, as successor Transfer Agent and Certificate Registrar
under this Agreement.
(b) The Trustee may revoke such appointment and
remove Chase as Transfer Agent and Certificate Registrar if the Trustee
determines in its sole discretion that Chase failed to perform its obligations
under this Agreement in any material respect. Chase shall be permitted to resign
as Transfer Agent and Certificate Registrar upon 30 days' written notice to the
Trustee, the Seller and the Servicer; provided, however, that such resignation
shall not be effective and Chase shall continue to perform its duties as
Transfer Agent and Certificate Registrar until the Trustee has appointed a
successor Transfer Agent and Certificate Registrar with the consent
of the Seller.
(c) Upon surrender for registration of transfer
of any Certificate at the office or agency of the Transfer Agent and Certificate
Registrar maintained pursuant to Section 6.7, the Trustee shall execute,
authenticate and (if the Transfer Agent and Certificate Registrar is different
than the Trustee, then the Transfer Agent and Certificate Registrar shall)
deliver (or shall cause Chase as its authenticating agent to authenticate and
deliver), in the name of the designated transferee or transferees, one or more
new Class A Certificates or Class B Certificates, as the case may be, in
authorized denominations of a like aggregate amount dated the date of
authentication by the Trustee or any authenticating agent. At the option of a
Certificateholder, Certificates may be exchanged for other Certificates of
authorized denominations of a like aggregate amount upon surrender of the
Certificates to be exchanged at the office or agency maintained pursuant to
Section 6.7.
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(d) Whenever any Certificate is surrendered
for exchange, the Trustee shall execute, authenticate and (if the Transfer Agent
and Certificate Registrar is different than the Trustee, then the Transfer Agent
and Certificate Registrar shall) deliver the Certificates which the
Certificateholder making the exchange is entitled to receive. Every Certificate
presented or surrendered for registration of transfer or exchange shall be
accompanied by a written instrument of transfer in form satisfactory to the
Trustee and the Transfer Agent and Certificate Registrar duly executed by the
Holder, which signature on such assignment must be guaranteed by a member of the
New York Stock Exchange or a commercial bank or trust company.
Each Certificate surrendered for registration of
transfer or exchange shall be cancelled by the Transfer Agent and Certificate
Registrar and disposed of by the Trustee or Transfer Agent and Certificate
Registrar in accordance with its customary practice.
(e) No service charge shall be made for any
registration of transfer or exchange of Certificates, but the Transfer Agent and
Certificate Registrar may require payment of a sum sufficient to cover any tax
or governmental charge that may be imposed in connection with any transfer or
exchange of Certificates.
(f) An institution succeeding to the
corporate agency business of the Transfer Agent and Certificate Registrar shall
continue to be the Transfer Agent and Certificate Registrar without the
execution or filing of any paper or any further act on the part of the Trustee
or such Transfer Agent and Certificate Registrar.
(g) The Class B Certificates may not be
acquired by or for the account of (i) an employee benefit plan (as defined in
Section 3(3) of the Employee Retirement Income Security Act of 1974, as amended
("ERISA")) which is subject to the provisions of Title I of ERISA, (ii) a plan
(as defined in Section 4975(e)(1) of the Code other than a governmental or
church plan described in Section 4975(g)(2) or (3) of the Code), or (iii) any
entity whose underlying assets include "plan assets" by reason of any such
plan's investment in the entity (excluding any investment company that is
registered under the Investment Company Act of 1940, as amended) (each, a
"Benefit Plan"). By accepting and holding a Class B Certificate, the Holder
thereof shall be deemed to have represented and warranted that it is not a
Benefit Plan, and that no assets of a Benefit Plan were used to acquire such
Class B Certificate. The foregoing restrictions shall not apply to acquisitions
of Class B Certificates with assets of the general account of an insurance
company, to the extent that the acquisition of such Class B Certificates (i) is
and will be permissible under Section 401(c) of ERISA and final regulations
thereunder or another exemption under ERISA and (ii)
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does not and will not result in the contemplated operations of the Trust being
treated as non-exempt prohibited transactions.
SECTION 6.4. Mutilated, Destroyed, Lost, or Stolen
Certificates. If (a) any mutilated Class A Certificate or Class B Certificate
shall be surrendered to the Transfer Agent and Certificate Registrar, or if the
Transfer Agent and Certificate Registrar shall receive evidence to its
satisfaction of the destruction, loss, or theft of any Class A Certificate or
Class B Certificate and (b) there shall be delivered to the Trustee and the
Transfer Agent and Certificate Registrar such security or indemnity as may be
required to save each of them harmless then, in the absence of notice to the
Trustee that such Class A Certificate or Class B Certificate shall have been
acquired by a bona fide purchaser, the Trustee on behalf of the Trust shall
execute, authenticate and (if the Transfer Agent and Certificate Registrar is
different from the Trustee, the Transfer Agent and Certificate Registrar shall)
deliver, in exchange for or in lieu of any such mutilated, destroyed, lost or
stolen Class A Certificate or Class B Certificate, a new Class A Certificate or
Class B Certificate, as the case may be, of like tenor and denomination but
bearing a number not contemporaneously outstanding. In connection with the
issuance of any new Certificate under this Section 6.4, the Trustee or the
Transfer Agent and Certificate Registrar, as the case may be, may require the
payment of a sum sufficient to cover any tax or other governmental charge that
may be imposed in connection therewith. Any duplicate Certificate issued
pursuant to this Section 6.4 shall constitute conclusive evidence of ownership
in the Trust, as if originally issued, whether or not a lost, stolen, or
destroyed Certificate shall be found at any time.
SECTION 6.5. Persons Deemed Owners. Prior to due presentation
of a Certificate for registration of transfer, the Trustee, the Paying Agent,
the Transfer Agent and Certificate Registrar or any agent of any of them may
treat the Person in whose name any Certificate shall be registered as the owner
of such Certificate for the purpose of receiving distributions pursuant to
Section 5.5(d) and for all other purposes whatsoever, and none of the Trustee,
the Paying Agent, the Transfer Agent and Certificate Registrar or any agent of
any of them shall be bound by any notice to the contrary.
SECTION 6.6. Access to List of Certificateholders' Names and
Addresses. The Transfer Agent and Certificate Registrar shall furnish or cause
to be furnished to the Servicer or the Paying Agent (or to the Trustee if the
Trustee is not the Transfer Agent and Certificate Registrar), within 15 days
after receipt by the Transfer Agent and Certificate Registrar of a request
therefor from the Servicer, the Trustee or the Paying Agent in writing, in such
form as the Servicer, the Trustee or the Paying Agent may reasonably require, a
list of the names and addresses of the Certificateholders as of the most recent
Record Date. If, at such time, if any, as Definitive Certificates have
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been issued, three or more Certificateholders, or one or more Holders of
Certificates aggregating not less than 25% of the sum of the Class A Certificate
Balance and the Class B Certificate Balance as a single class apply in writing
to the Transfer Agent and Certificate Registrar (or the Trustee if the Trustee
is acting as the Transfer Agent and Certificate Registrar), and such application
states that the applicants desire to communicate with other Certificateholders
with respect to their rights under this Agreement or under the Certificates, and
such application is accompanied by a copy of the communication that such
applicants propose to transmit, then the Transfer Agent and Certificate
Registrar shall, within five (5) Business Days after the receipt of such
application, afford such applicants access during normal business hours to the
current list of Certificateholders. Each Certificateholder, by receiving and
holding a Certificate, shall be deemed to have agreed to hold neither the
Servicer, the Trustee, the Transfer Agent and Certificate Registrar nor any of
their respective agents accountable by reason of the disclosure of its name and
address, regardless of the source from which such information was derived.
SECTION 6.7. Maintenance of Office or Agency. The
Transfer Agent and Certificate Registrar shall maintain in The
City of New York an office or offices or agency or agencies where
Certificates may be surrendered for registration of transfer or
exchange. The Transfer Agent and Certificate Registrar initially
designates its corporate trust office located at 450 West 33rd
Street, New York, New York 10001-2697 as its office for such
purposes. The Transfer Agent and Certificate Registrar shall
give prompt written notice to the Trustee, the Servicer and to
Certificateholders of any change in the location of such office
or agency.
SECTION 6.8. Book-Entry Certificates. Upon original issuance,
the Class A Certificates and the Class B Certificates, other than the Class A
Certificate representing the residual amount of the Original Class A Certificate
Balance, shall be issued in the form of typewritten Certificates representing
the Book-Entry Certificates, to be delivered to The Depository Trust Company,
the initial Clearing Agency, by or on behalf of the Seller. The Certificates
shall initially be registered on the Certificate Register in the name of Cede &
Co., the nominee of the initial Clearing Agency, and no Certificate Owner will
receive a definitive certificate representing such Certificate Owner's interest
in the Class A Certificates or the Class B Certificates, as the case may be,
except as provided in Section 6.10. Unless and until definitive, fully
registered Certificates ("Definitive Certificates") have been issued to Class A
Certificateholders or Class B Certificateholders pursuant to Section 6.10:
(i) the provisions of this Section 6.8 shall be in
full force and effect;
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(ii) the Seller, the Servicer, the Paying Agent, the
Transfer Agent and Certificate Registrar and the Trustee may
deal with the Clearing Agency, and the Clearing Agency Participants for
all purposes of this Agreement (including the making of distributions
on the Certificates and the taking of actions by the
Certificateholders) as the authorized representatives of the
Certificate Owners;
(iii) to the extent that the provisions of
this Section 6.8 conflict with any other provisions of this Agreement,
the provisions of this Section 6.8 shall control;
(iv) the rights of Certificate Owners
shall be exercised only through the Clearing Agency (or to the extent
Certificate Owners are not Clearing Agency Participants through the
Clearing Agency Participants through which such Certificate Owners own
Book-Entry Certificates), and shall be limited to those established by
law and agreements between such Certificate Owners and the Clearing
Agency and/or the Clearing Agency Participants and all references in
this Agreement to actions by Certificateholders shall refer to actions
taken by the Clearing Agency upon instructions from the Clearing Agency
Participants, and all references in this Agreement to distributions,
notices, reports and statements to Certificateholders shall refer to
distributions, notices, reports and statements to the Clearing Agency,
as registered holder of the Certificates, as the case may be, for
distribution to Certificate Owners in accordance with the procedures of
the Clearing Agency; and
(v) pursuant to the Depository Agreement, and unless
Definitive Certificates are issued pursuant to Section 6.10, the
initial Clearing Agency will make book-entry transfers among the
Clearing Agency Participants and receive and transmit distributions
of principal and interest on the Certificates to the Clearing Agency
Participants, for distribution by such Clearing Agency Participants to
the Certificate Owners or their nominees.
SECTION 6.9. Notices to Clearing Agency. Whenever notice or
other communication to the Certificateholders is required under this Agreement,
unless and until Definitive Certificates shall have been issued to Certificate
Owners pursuant to Section 6.10, the Trustee and the Paying Agent shall give all
such notices and communications specified herein to be given by it to
Certificateholders to the Clearing Agency.
SECTION 6.10. Definitive Certificates. If (i) the Servicer
advises the Trustee in writing that the Clearing Agency is no longer willing or
able to properly discharge its responsibilities under the Depository Agreement,
and the Servicer is unable to locate a qualified successor, (ii) the Servicer,
at its option, elects to terminate the book-entry system through the
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Clearing Agency or (iii) after the occurrence of an Event of Servicing
Termination, Class A Certificate Owners representing in the aggregate not less
than a majority of the Class A Certificate Balance or Class B Certificate Owners
representing in the aggregate not less than a majority of the Class B
Certificate Balance, as the case may be, advise the Trustee and the Clearing
Agency through the Clearing Agency Participants in writing, and if the Clearing
Agency shall so notify the Trustee, that the continuation of a book-entry system
through the Clearing Agency is no longer in the related Certificate Owners' best
interests, the Trustee shall notify the Clearing Agency of the occurrence of any
event described above, which shall be responsible to notify the Certificate
Owners with respect to Class A Certificates or Class B Certificates or both, as
the case may be, of the occurrence of any such event and of the availability of
Definitive Certificates to Certificate Owners with respect to Class A
Certificates or Class B Certificates or both, as the case may be, requesting the
same. Upon surrender to the Transfer Agent and Certificate Registrar by the
Clearing Agency of the Class A Certificates or the Class B Certificates or both,
as the case may be, registered in the name of such Clearing Agency, or its
nominee, accompanied by re-registration instructions from the Clearing Agency
for registration of the Definitive Certificates, the Trustee shall execute,
authenticate and (if the Transfer Agent and Certificate Registrar is different
than the Trustee, then the Transfer Agent and Certificate Registrar shall)
deliver Definitive Certificates in accordance with the instructions of the
Clearing Agency. The Servicer shall arrange for, and will bear all costs of, the
printing and issuance of such Definitive Certificates. None of the Seller, the
Servicer, the Transfer Agent and Certificate Registrar or the Trustee shall be
liable for any delay in delivery of such instructions and may conclusively rely
on, and shall be protected in relying upon such instruction. Upon the issuance
of Definitive Certificates, all references herein to obligations imposed upon or
to be performed by the Clearing Agency shall be deemed to be imposed upon and
performed by the Transfer Agent and Certificate Registrar, to the extent
applicable with respect to such Definitive Certificates and the Trustee, the
Paying Agent and the Transfer Agent and Certificate Registrar shall recognize
the Holders of the Definitive Certificates as Certificateholders hereunder.
SECTION 6.11. Appointment of Paying Agent.
(a) The Paying Agent shall have the revocable
power to withdraw funds from the Accounts and make distributions to the
Certificateholders, the Servicer and the Collateral Agent pursuant to Section
5.5. The Trustee may revoke such power and remove the Paying Agent, if the
Trustee determines in its sole discretion that the Paying Agent shall have
failed to perform its obligations under this Agreement in any material respect
or for other good cause. The Paying Agent shall initially be the corporate trust
office of Chase. Chase shall be permitted to resign as Paying Agent upon 30
days' written notice to the
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Servicer and the Trustee. In the event that Chase shall no longer be the Paying
Agent, the Trustee shall appoint a successor to act as Paying Agent (which shall
be a bank or trust company and may be the Trustee) with the consent of the
Seller, which consent shall not be unreasonably withheld. If at any time the
Trustee shall be acting as the Paying Agent, the provisions of Sections 10.1,
10.3 and 10.4 shall apply to the Trustee in its role as Paying Agent.
(b) The Trustee shall cause the Paying Agent
(other than itself and Chase) to execute and deliver to the Trustee an
instrument in which such Paying Agent shall agree with the Trustee that such
Paying Agent will hold all sums, if any, held by it for payment to the
Certificateholders in trust for the benefit of the Certificateholders entitled
thereto until such sums shall be paid to such Certificateholders and shall
agree, and if the Trustee is the Paying Agent it hereby agrees, that it shall
comply with all requirements of the Code regarding the withholding by the
Trustee of payments in respect of federal income taxes due from Certificate
Owners.
(c) Chase in its capacity as initial Paying
Agent hereunder agrees that it (i) will hold all sums held by it hereunder for
payment to the Certificateholders in trust for the benefit of the
Certificateholders entitled thereto until such sums shall be paid to such
Certificateholders and (ii) shall comply with all requirements of the Code
regarding the withholding by the Trustee of payments in respect of federal
income taxes due from Certificate Owners.
(d) An institution succeeding to the
corporate agency business of the Paying Agent shall continue to be the Paying
Agent without the execution or filing of any paper or any further act on the
part of the Trustee or such Paying Agent.
SECTION 6.12. Authenticating Agent.
(a) The Trustee may appoint one or more
authenticating agents with respect to the Certificates which shall be authorized
to act on behalf of the Trustee in authenticating the Certificates in connection
with the issuance, delivery, registration of transfer, exchange or repayment of
the Certificates. The Trustee hereby appoints the corporate trust office of
Chase as Authenticating Agent for the authentication of Certificates upon any
registration of transfer or exchange of such Certificates. Whenever reference is
made in this Agreement to the authentication of Certificates by the Trustee or
the Trustee's certificate of authentication, such reference shall be deemed to
include authentication on behalf of the Trustee by an authenticating agent and a
certificate of authentication executed on behalf of the Trustee by an
authenticating agent. Each authenticating agent (other than Chase) shall be
acceptable to the Seller.
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(b) Any institution succeeding to the
corporate agency business of an authenticating agent shall continue to be an
authenticating agent without the execution or filing of any paper or any further
act on the part of the Trustee or such authenticating agent.
(c) An authenticating agent may at any time
resign by giving written notice of resignation to the Trustee and the Seller.
The Trustee may at any time terminate the agency of an authenticating agent by
giving notice of termination to such authenticating agent and to the Seller.
Upon receiving such a notice of resignation or upon such a termination, or in
case at any time an authenticating agent shall cease to be acceptable to the
Trustee or the Seller, the Trustee promptly may appoint a successor
authenticating agent with the consent of the Seller. Any successor
authenticating agent upon acceptance of its appointment hereunder shall become
vested with all the rights, powers and duties of its predecessor hereunder, with
like effect as if originally named as an authenticating agent. No successor
authenticating agent shall be appointed unless acceptable to the Seller.
(d) The Servicer shall pay the Authenticating
Agent from time to time reasonable compensation for its services under this
Section 6.12.
(e) The provisions of Sections 10.1, 10.3 and
10.4 shall be applicable to any authenticating agent.
(f) Pursuant to an appointment made under
this Section 6.12, the Certificates may have endorsed thereon, in lieu of the
Trustee's certificate of authentication, an alternate certificate of
authentication in substantially the following form:
This is one of the certificates referred to in the within
mentioned Agreement.
-----------------------,
as Trustee
By:
------------------------------------
Authorized Officer
or
----------------------------------
as Authenticating Agent
for the Trustee,
----------------------------------
Authorized Officer
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SECTION 6.13. Actions of Certificateholders.
(a) Any request, demand, authorization,
direction, notice, consent, waiver or other action provided by this Agreement to
be given or taken by Certificateholders may be embodied in and evidenced by one
or more instruments of substantially similar tenor signed by such
Certificateholders in person or by an agent duly appointed in writing; and
except as herein otherwise expressly provided, such action shall become
effective when such instrument or instruments are delivered to the Trustee and,
when required, to the Seller or the Servicer. Proof of execution of any such
instrument or of a writing appointing any such agent shall be sufficient for any
purpose of this Agreement and conclusive in favor of the Trustee, the Seller and
the Servicer, if made in the manner provided in this Section 6.13.
(b) The fact and date of the execution by any
Certificateholder of any such instrument or writing may be proved in any
reasonable manner which the Trustee deems sufficient.
(c) Any request, demand, authorization,
direction, notice, consent, waiver or other act by a Certificateholder shall
bind every Holder of every Certificate issued upon the registration of transfer
thereof or in exchange therefor or in lieu thereof, in respect of anything done,
or omitted to be done, by the Trustee, the Seller or the Servicer in reliance
thereon, whether or not notation of such action is made upon such Certificate.
(d) The Trustee may require such additional
proof of any matter referred to in this Section 6.13 as it shall deem
necessary.
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ARTICLE VII
THE SELLER
SECTION 7.1. Representations of Seller. The Seller makes the
following representations on which the Trustee shall rely in accepting the
Receivables in trust and authenticating the Certificates. The representations
shall speak as of the execution and delivery of this Agreement, and shall
survive the sale of the Receivables to the Trustee.
(i) Organization and Good Standing.
The Seller has been duly organized and is validly existing as a
national banking association in good standing under the laws of the
United States of America, with power and authority to own its
properties and to conduct its business as such properties are
currently owned and such business is presently conducted, and had at
all relevant times, and has, power, authority, and legal right to
acquire and own the Receivables.
(ii) Power and Authority. The Seller
has the power and authority to execute and deliver this Agreement and
to carry out its terms, the Seller has full power and authority to sell
and assign the property to be sold and assigned to the Trustee as part
of the Trust and has duly authorized such sale and assignment to this
Trustee by all necessary corporate action; and the execution, delivery,
and performance of this Agreement has been duly authorized by the
Seller by all necessary corporate action.
(iii) Valid Sale; Binding Obligations.
This Agreement effects a valid sale, transfer, and assignment of the
Receivables, enforceable against creditors of and purchasers from the
Seller; and constitutes a legal, valid, and binding obligation of the
Seller enforceable in accordance with its terms, except as
enforceability may be limited by bankruptcy, insolvency,
reorganization, or other similar laws affecting the enforcement of
creditors' rights in general and by general principles of equity,
regardless of whether such enforceability is considered in a proceeding
in equity or at law.
(iv) No Violation. The consummation
of the transactions contemplated by this Agreement and the fulfillment
of the terms hereof do not conflict with, result in any breach of any
of the terms and provisions of, nor constitute (with or without notice
or lapse of time) a default under, the articles of association or
bylaws of the Seller, or conflict with or breach any of the material
terms or provisions of, or constitute (with or without notice or lapse
of time) a default under, any indenture, agreement, or other
instrument to which the Seller is a party or by which it is bound;
nor result in the creation or imposition of any Lien
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upon any of its properties pursuant to the terms of any such indenture,
agreement, or other instrument; nor violate any law or, to the best of
the Seller's knowledge, any order, rule, or regulation applicable to
the Seller of any court or of any federal or state regulatory body,
administrative agency, or other governmental instrumentality having
jurisdiction over the Seller or its properties.
(v) No Proceedings. There are no
proceedings or investigations pending, or, to the Seller's best
knowledge, threatened, before any court, regulatory body,
administrative agency, or other governmental instrumentality having
jurisdiction over the Seller or its properties: (a) asserting the
invalidity of this Agreement or the Certificates, (b) seeking to
prevent the issuance of the Certificates or the consummation of any of
the transactions contemplated by this Agreement, (c) seeking any
determination or ruling that might materially and adversely affect the
performance by the Seller of its obligations under, or the validity or
enforceability of, this Agreement or the Certificates, or (d) relating
to the Seller and which might adversely affect the federal income tax
attributes of the Certificates.
SECTION 7.2. Liability of Seller; Indemnities. The Seller
shall be liable in accordance herewith only to the extent of the obligations
specifically undertaken by the Seller in such capacity under this Agreement and
shall have no other obligations or liabilities hereunder.
The Seller shall indemnify, defend and hold harmless the
Trustee and the Trust from and against any taxes that may at any time be
asserted against the Trust with respect to, and as of the date of, the sale of
the Receivables to the Trust or the issuance and original sale of the
Certificates, including any sales, gross receipts, general corporation, tangible
or intangible personal property, privilege, or license taxes (but not including
any taxes asserted with respect to ownership of the Receivables or federal or
other income taxes, including franchise taxes measured by net income), arising
out of the transactions contemplated by this Agreement, and costs and expenses
in defending against the same.
The Seller shall indemnify, defend, and hold harmless the
Trustee or the Trust from and against any loss, liability or expense incurred by
reason of (i) the Seller's wilful misfeasance, bad faith, or negligence in the
performance of its duties hereunder, or by reason of reckless disregard of the
obligations and duties hereunder and (ii) the Seller's violation of federal or
state securities laws in connection with the registration of the sale of the
Certificates.
Indemnification under this Section 7.2 shall include
reasonable fees and expenses of counsel and expenses of
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litigation. If the Seller shall have made any indemnity payments to the Trust
pursuant to this Section 7.2 and the Trust thereafter shall collect any of such
amounts from others, the Trust shall repay such amounts to the Seller, without
interest.
SECTION 7.3. Merger or Consolidation of Seller. Any
corporation or other entity (i) into which the Seller may be merged or
consolidated, (ii) which may result from any merger, conversion, or
consolidation to which the Seller shall be a party, or (iii) which may succeed
to all or substantially all of the business of the Seller, which corporation or
other entity shall be bound to perform every obligation of the Seller under this
Agreement, shall be the successor to the Seller hereunder without the execution
or filing of any document or any further act by any of the parties to this
Agreement. The Seller shall give prompt written notice of any merger or
consolidation to the Trustee, the Servicer, the Collateral Agent and the Rating
Agencies.
SECTION 7.4. Limitation on Liability of Seller and Others. The
Seller and any director, officer, employee or agent of the Seller may rely in
good faith on the advice of counsel or on any document of any kind, prima facie
properly executed and submitted by any Person respecting any matters arising
hereunder. The Seller shall not be under any obligation under this Agreement to
appear in, prosecute, or defend any legal action that shall be unrelated to its
obligations under this Agreement, and that in its opinion may involve it in any
expense or liability.
SECTION 7.5. Seller May Own Certificates. The Seller and any
of its Affiliates may in its individual or any other capacity become the owner
or pledgee of Certificates with the same rights as it would have if it were not
the Seller or an Affiliate thereof, except as otherwise provided in the
definition of "Class A Certificateholder" and "Class B Certificateholder"
specified in Section 1.1. Certificates so owned by or pledged to the Seller or
any Affiliates shall have an equal and proportionate benefit under the
provisions of this Agreement, without preference, priority, or distinction as
among all of the Certificates.
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ARTICLE VIII
THE SERVICER
SECTION 8.1. Representations of Servicer. The Servicer makes
the following representations on which the Trustee shall rely in accepting the
Receivables in trust and authenticating the Certificates. The representations
shall speak as of the execution and delivery of this Agreement (or as of a date
a Person (other than the Trustee) becomes a Servicer pursuant to Section 8.3 or
9.2), and shall survive the sale of the Receivables to the Trustee.
(i) Organization and Good Standing.
The Servicer has been duly organized and is validly existing as a
national banking association or corporation and is in good standing
under the laws of the United States of America or the jurisdiction of
its incorporation, with power and authority to own its properties and
to conduct its business as such properties are currently owned and such
business is presently conducted, and had at all relevant times, and
has, power, authority, and legal right to acquire, own, sell, and
service the Receivables and to hold the Receivable Files as custodian
on behalf of the Trustee.
(ii) Power and Authority. The Servicer
has the power and authority to execute and deliver this Agreement and
to carry out its terms; and the execution, delivery, and performance of
this Agreement has been duly authorized by the Servicer by all
necessary corporate action.
(iii) Binding Obligations. This
Agreement constitutes a legal, valid, and binding obligation of the
Servicer enforceable in accordance with its terms subject, as to
enforcement, to applicable bankruptcy, insolvency, reorganization,
liquidation or other similar laws and equitable principles relating
to or affecting the enforcement of creditors' rights, whether
considered in a proceeding at law or in equity.
(iv) No Violation. The consummation
of the transactions contemplated by this Agreement and the
fulfillment of the terms hereof do not conflict with, result in any
breach of any of the terms and provisions of, nor constitute (with or
without notice or lapse of time) a default under, the articles of
association or bylaws of the Servicer, or conflict with or breach any
of the material terms or provisions of, or constitute (with or without
notice or lapse of time) a default under, any indenture, agreement,
or other instrument to which the Servicer is a party or by which it
is bound; nor result in the creation or imposition of any lien upon
any of its properties pursuant to the terms of any such indenture,
agreement, or other instrument; nor
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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.
(v) No Proceedings. There are no
proceedings or investigations pending, or to the Servicer's best
knowledge, threatened, before any court, regulatory body,
administrative agency, or other governmental instrumentality having
jurisdiction over the Servicer or its properties: (a) asserting the
invalidity of this Agreement or the Certificates, (b) seeking to
prevent the issuance of the Certificates or the consummation of any of
the transactions contemplated by this Agreement, (c) seeking any
determination or ruling that might materially and adversely affect the
performance by the Servicer of its obligations under, or the validity
or enforceability of, this Agreement or the Certificates, or (d)
relating to the Servicer and which might adversely affect the federal
income tax attributes of the Certificates.
(vi) Fidelity Bond. The Servicer
maintains a fidelity bond in such form and amount as is customary for
banks acting as custodian of funds and documents in respect of retail
automotive installment sales contracts.
SECTION 8.2. Liability of Servicer; Indemnities. The Servicer
shall be liable in accordance herewith only to the extent of the obligations
specifically undertaken by the Servicer under this Agreement and shall have no
other obligations or liabilities hereunder.
(i) The Servicer shall defend,
indemnify, and hold harmless the Trustee, the Trust and the
Certificateholders from and against any and all costs, expenses,
losses, damages, claims, and liabilities, arising out of or resulting
from the use, ownership, or operation by the Servicer or any Affiliate
thereof of a Financed Vehicle.
(ii) The Servicer shall indemnify,
defend, and hold harmless the Trustee and the Trust from and
against any taxes that may at any time be asserted against
the Trust with respect to the transactions contemplated in
this Agreement, including, without limitation, any sales,
gross receipts, general corporation, tangible or intangible
personal property, privilege, or license taxes (but not
including any taxes asserted with respect to, and as of the
date of, the sale of the Receivables to the Trust or the
issuance and original sale of the Certificates, or asserted
with respect to ownership of the Receivables or federal or
other income taxes, including franchise taxes measured by
net income) arising out of distributions on the Certificates
and costs and expenses in defending against the same.
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(iii) The Servicer shall indemnify,
defend, and hold harmless the Trustee and the Trust and the
Certificateholders from and against any and all costs, expenses,
losses, claims, damages, and liabilities to the extent that such cost,
expense, loss, claim, damage, or liability arose out of, or was
imposed upon the Trustee and the Trust or the Certificateholders
through the wilful misfeasance, gross negligence, or bad faith of the
Servicer in the performance of its duties under this Agreement or by
reason of reckless disregard of its obligations and duties under this
Agreement.
Indemnification under this Section 8.2 shall include
reasonable fees and expenses of counsel and expenses of litigation. If the
Servicer shall have made any indemnity payments pursuant to this Section 8.2 and
the recipient thereafter collects any of such amounts from others, the recipient
shall promptly repay such amounts to the Servicer, without interest. The
indemnification obligations of the Servicer set forth in this Section 8.2 shall
survive the termination of such Servicer with respect to any act or failure to
act which occurs prior to such Servicer's termination.
SECTION 8.3. Merger or Consolidation of Servicer. Any
corporation or other entity (i) into which the Servicer may be merged or
consolidated, (ii) which may result from any merger, conversion, or
consolidation to which the Servicer shall be a party, or (iii) which may succeed
to all or substantially all of the business of the Servicer, which corporation
or other entity shall be bound to perform every obligation of the Servicer here-
under, shall be the successor to the Servicer under this Agreement without the
execution or filing of any document or any further act on the part of any of the
parties to this Agreement. The Servicer shall promptly inform the Trustee, the
Seller, the Collateral Agent and the Rating Agencies in writing of any such
merger or consolidation.
SECTION 8.4. Limitation on Liability of Servicer and
Others.
(a) Neither the Servicer nor any of the
directors, officers, or employees or agents of the Servicer shall be under any
liability to the Trust, the Trustee, or the Certificateholders, except as
provided under this Agreement, for any action taken or for refraining from the
taking of any action pursuant to this Agreement; provided, however, that this
provision shall not protect the Servicer or any such person against any
liability that would otherwise be imposed by reason of wilful misfeasance, gross
negligence, or bad faith in the performance of duties or by reason of reckless
disregard of obligations and duties under this Agreement. The Servicer and any
director, officer, or employee or agent of the Servicer may rely in good faith
on the advice of counsel or on any document of
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any kind prima facie properly executed and submitted by any Person respecting
any matters arising under this Agreement.
(b) The Servicer, and any director, officer,
employee or agent of the Servicer, shall be indemnified by the Trust and held
harmless against any loss, liability, or expense (including reasonable
attorneys' fees and expenses) incurred in connection with any legal action
relating to the performance of the Servicer's duties under this Agreement, other
than (i) any loss or liability otherwise reimbursable pursuant to this
Agreement; (ii) any loss, liability, or expense incurred solely by reason of the
Servicer's wilful misfeasance, negligence, or bad faith in the performance of
its duties hereunder or by reason of reckless disregard of its obligations and
duties under this Agreement or the Trust Agreement; and (iii) any loss,
liability, or expense for which the Trust is to be indemnified by the Servicer
under this Agreement. Any amounts due the Servicer pursuant to this Section 8.4
shall be payable on a Distribution Date from amounts distributable to the Seller
from the Reserve Account pursuant to Section 5.6(e) (other than Investment
Earnings) after all payments required to be made on such date to the
Certificateholders and the Servicer, and amounts, if any, distributable
therefrom to the Trustee pursuant to Section 10.7, have been paid and any
amounts required to be retained on deposit in the Reserve Account pursuant to
Section 5.6(e) to maintain the amount on deposit therein (exclusive of
Investment Earnings) in an amount equal to the Specified Reserve Account Balance
on such date shall have been made.
(c) Except as provided in this Agreement, the
Servicer shall not be under any obligation to appear in, prosecute, or defend
any legal action that shall not be incidental to its obligations under this
Agreement, and that in its opinion may involve it in any expense or liability;
provided, however, that the Servicer may undertake any reasonable action that it
may deem necessary or desirable in respect of this Agreement and the rights and
duties of the parties to this Agreement and the interests of the
Certificateholders under this Agreement. In such event, the legal expenses and
costs of such action and any liability resulting therefrom shall be expenses,
costs, and liabilities of the Trust, and the Servicer shall be entitled to be
reimbursed therefor. Any amounts due the Servicer pursuant to this Section 8.4
shall be payable on a Distribution Date from amounts distributable to the Seller
from the Reserve Account pursuant to Section 5.6(e) (other than Investment
Earnings) after all payments required to be made on such date to the
Certificateholders and the Servicer, and amounts, if any, distributable
therefrom to the Trustee pursuant to Section 10.7, have been paid and any
amounts required to be retained on deposit in the Reserve Account pursuant to
Section 5.6(e) to maintain the amount on deposit therein (exclusive of
Investment Earnings) in an amount equal to the Specified Reserve Account Balance
on such date shall have been made.
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The Person to be indemnified shall provide the
Trustee with a certificate and accompanying Opinion of Counsel requesting
indemnification and setting forth the basis for such request.
SECTION 8.5. Servicer Not To Resign. Except as permitted by
Section 8.3, the Servicer shall not resign from its obligations and duties under
this Agreement except (i) upon determination that the performance of its duties
shall no longer be permissible under applicable law or (ii) in the event of the
appointment of a successor Servicer, upon satisfaction of the Rating Agency
Condition. Notice of any such determination permitting the resignation of Chase
USA shall be communicated to the Trustee and the Rating Agencies at the earliest
practicable time (and, if such communication is not in writing, shall be
confirmed in writing at the earliest practicable time) and any such
determination permitting the resignation of the Servicer shall be evidenced by
an Opinion of Counsel to such effect delivered to the Trustee concurrently with
such notice. No such resignation shall become effective until the Trustee (which
shall not be obligated to act as successor Servicer if the Servicer has resigned
for a reason other than that the performance of its duties are no longer
permissible under applicable law) or a successor Servicer shall have assumed the
responsibilities and obligations of the Servicer hereunder in accordance with
Section 9.2.
SECTION 8.6. Delegation of Duties. So long as Chase USA (or
any successor thereto in accordance with Section 8.3) or the Trustee acts as
Servicer, the Servicer shall have the right, in the ordinary course of its
business, to delegate any of its duties under this Agreement to any Person. Any
compensation payable to such Person shall be paid by the Servicer from its own
funds and none of the Trust, the Trustee (if not the Servicer), the Collateral
Agent or the Certificateholders shall have any liability to such Person with
respect thereto. Notwithstanding any delegation of duties by the Servicer
pursuant to this Section 8.6, the Servicer shall not be relieved of its
liability and responsibility with respect to such duties, and any such
delegation shall not constitute a resignation within the meaning of Section 8.5
hereof. Any agreement that may be entered into by the Servicer and a Person that
provides for any delegation of the Servicer's duties hereunder shall be deemed
to be between the Servicer and such Person alone, and the Trustee and
Certificateholders shall not be deemed parties thereto and shall have no claims,
rights, obligations, duties or liabilities with respect thereto.
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ARTICLE IX
DEFAULT
SECTION 9.1. Events of Servicing Termination. Any one of the
following events which shall occur and be continuing shall constitute an event
of servicing termination hereunder (each, an "Event of Servicing Termination"):
(i) Any failure by the Servicer to
deliver to the Trustee the Servicer's Certificate for the related
Collection Period, or any failure by the Servicer to deliver to the
Trustee, for distribution to Certificateholders, any proceeds or
payment required to be so delivered under the terms of the
Certificates and this Agreement (or, in the case of a payment or
deposit to be made not later than the Deposit Date, the failure to
make such payment or deposit on such Deposit Date), which failure
continues unremedied for a period of five Business Days after (A)
discovery by an officer of the Servicer or (B) written notice (1) to
the Servicer by the Trustee or (2) to the Trustee and the Servicer by
the Holders of Certificates evidencing not less than 25% of the sum
of the Class A Certificate Balance and the Class B Certificate Balance
voting as a single class;
(ii) Failure on the part of the
Servicer, duly to observe or to perform in any material respect any
other covenants or agreements of the Servicer set forth in the
Certificates or in this Agreement, which failure shall (a) materially
and adversely affect the rights of the Trust or the Certificateholders
(which determination shall be made without regard to the Available
Reserve Account Amount and (b) continues unremedied for a period of
60 days after the date on which written notice of such failure,
requiring the same to be remedied, shall have been given (1) to the
Servicer by the Trustee or (2) to the Trustee and the Servicer by the
Holders of Certificates evidencing not less than 25% of the sum of the
Class A Certificate and the Class B Certificate Balance voting as a
single class;
(iii) The entry of a decree or order by
a court or agency or supervisory authority having jurisdiction in the
premises for the appointment of a conservator, receiver, or liquidator
for the Servicer in any insolvency, readjustment of debt, marshalling
of assets and liabilities, or similar proceedings, or for the winding
up or liquidation of its affairs, and the continuance of any such
decree or order unstayed and in effect for a period of 60 consecutive
days; or
(iv) The consent by the Servicer to
the appointment of a conservator or receiver or liquidator in any
insolvency, readjustment of debt, marshalling of assets and
liabilities, or similar proceedings of or relating to the
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Servicer or of or relating to substantially all of its property; or the
Servicer shall admit in writing its inability to pay its debts
generally as they become due, file a petition to take advantage of any
applicable insolvency or reorganization statute, make an assignment for
the benefit of its creditors, or voluntarily suspend payment of its
obligations.
Upon the occurrence of an Event of Servicing Termination described above, and in
each and every case and for so long as such Event of Servicing Termination shall
not have been remedied, either the Trustee, or the Holders of Certificates
evidencing not less than a majority of the sum of the Class A Certificate
Balance and the Class B Certificate Balance voting as a single class, by notice
given in writing to the Servicer (and to the Trustee if given by the
Certificateholders) may terminate all of the rights and obligations of the
Servicer under this Agreement. On or after the receipt by the Servicer of such
written notice, all authority and power of the Servicer under this Agreement,
whether with respect to the Certificates or the Receivables or otherwise, shall
pass to and be vested in the Trustee pursuant to this Section 9.1; and, without
limitation, the Trustee shall be hereby authorized and empowered to execute and
deliver, on behalf of the predecessor Servicer, as attorney-in-fact or
otherwise, any and all documents and other instruments, and to do or accomplish
all other acts or things necessary or appropriate to effect the purposes of such
notice of termination, whether to complete the transfer and endorsement of the
Receivable Files, or otherwise. The predecessor Servicer shall cooperate with
the successor Servicer and the Trustee in effecting the termination of the
responsibilities and rights of the predecessor Servicer under this Agreement,
including the transfer to the successor Servicer for administration by it of all
cash amounts that shall at the time be held by the predecessor Servicer for
deposit, shall have been deposited by the Servicer in the Collection Account, or
shall thereafter be received with respect to a Receivable. All reasonable costs
and expenses (including attorneys' fees and disbursements) incurred in
connection with transferring the Receivable Files to the successor Servicer and
amending this Agreement to reflect such succession as Servicer pursuant to this
Section 9.1 shall be paid by the predecessor Servicer upon presentation of
reasonable documentation of such costs and expenses. The Trustee shall give
written notice of any termination of the Servicer to the Certificateholders and
the Rating Agencies.
SECTION 9.2. Trustee to Act; Appointment of Successor
Servicer. Upon the Servicer's receipt of notice of termination pursuant to
Section 9.1 or resignation pursuant to Section 8.5, the Trustee shall be the
successor in all respects to the Servicer in its capacity as Servicer under this
Agreement, and shall be subject to all the responsibilities, duties and
liabilities arising thereafter relating thereto placed on the Servicer by the
terms and provisions of this Agreement. As
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compensation therefor, the Trustee shall be entitled to such compensation
(whether payable out of the Collection Account or otherwise) as the Servicer
would have been entitled to under this Agreement if no such notice of
termination or resignation had been given. Notwithstanding the above, the
Trustee may, if it shall be unwilling so to act, or shall, if it shall be
legally unable so to act, appoint, or petition a court of competent jurisdiction
to appoint, any established financial institution (x) having a net worth of not
less than $100,000,000 as of the last day of the most recent fiscal quarter for
such institution and (y) whose regular business shall include the servicing of
automobile receivables, as successor Servicer under this Agreement; provided,
that the appointment of any such successor Servicer is required to satisfy the
Rating Agency Condition. In connection with such appointment, the Trustee may
make such arrangements for the compensation of such successor Servicer out of
payments on Receivables as it and such successor Servicer shall agree; provided,
however, that no such compensation shall be in excess of that permitted the
Servicer under this Agreement. The Trustee and such successor Servicer shall
take such action, consistent with this Agreement, as shall be necessary to
effectuate any such succession. Unless the Trustee shall be prohibited by law
from so acting, the Trustee shall not be relieved of its duties as successor
Servicer under this Section 9.2 until the newly appointed successor Servicer
shall have assumed the responsibilities and obligations of the Servicer under
this Agreement.
SECTION 9.3. Notification to Certificateholders. Upon
delivery of written notice by the Trustee to the Servicer or receipt by the
Trustee of written notice of an Event of Servicing Termination from Holders of
Class A Certificates and Class B Certificates evidencing not less than 25% of
the sum of the Class A Certificate Balance and the Class B Certificate Balance
voting as a single class or upon any Servicer termination, or appointment of a
successor Servicer pursuant to this Article IX, the Trustee shall give prompt
written notice thereof to Certificateholders at their respective addresses of
record, to the Seller and to the Rating Agencies.
SECTION 9.4. Waiver of Past Defaults. The Holders of
Certificates evidencing not less than a majority of the sum of the Class A
Certificate Balance and the Class B Certificate Balance voting as a single
class, may, on behalf of all Holders of Certificates, waive any default by the
Servicer in the performance of its obligations hereunder and its consequences,
except a default in the failure to make any required deposits to or payments
from the Collection Account in accordance with this Agreement. Upon any such
waiver of a past default, such default shall cease to exist, and any Event of
Servicing Termination arising therefrom shall be deemed to have been remedied
for every purpose of this Agreement. No such waiver shall extend to any
subsequent or other default or impair any right consequent thereon except to the
extent expressly so waived. The Servicer
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shall give prompt written notice of any waiver to the Rating
Agencies.
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ARTICLE X
THE TRUSTEE
SECTION 10.1. Duties of Trustee. The Trustee, both prior to
and after the occurrence of an Event of Servicing Termination, shall undertake
to perform such duties and only such duties as are specifically set forth in
this Agreement. If an Event of Servicing Termination known to the Trustee shall
have occurred and shall not have been cured, the Trustee shall exercise such of
the rights and powers vested in it by this Agreement, and shall use the same
degree of care and skill in their exercise, as a prudent man would exercise or
use under the circumstances in the conduct of his own affairs; provided,
however, that if the Trustee shall assume the duties of the Servicer pursuant to
Sections 8.5 and 9.2, the Trustee in performing such duties shall use the degree
of skill and attention customarily exercised by a servicer with respect to
automobile receivables that it services for itself.
The Trustee, upon receipt of any resolutions, certificates,
statements, opinions, reports, documents, orders, or other instruments furnished
to the Trustee that shall be specifically required to be furnished pursuant to
any provision of this Agreement, shall examine them to determine whether they
conform to the requirements of this Agreement; provided, however, that the
Trustee shall not be responsible for the accuracy or content of any such
resolution, certificate, statement, opinion, report, document, order or other
instrument furnished by the Servicer to the Trustee pursuant to this Agreement.
No provision of this Agreement shall be construed to relieve
the Trustee from liability for its own negligent action, its own negligent
failure to act, or its own bad faith or wilful misfeasance; provided, however,
that:
(i) Prior to the occurrence of an
Event of Servicing Termination, and after the curing of all such
Events of Servicing Termination that may have occurred, the duties and
obligations of the Trustee shall be determined solely by the express
provisions of this Agreement, the Trustee shall not be liable except
for the performance of such duties and obligations as shall be
specifically set forth in this Agreement, no implied covenants or
obligations shall be read into this Agreement against the Trustee, the
permissible right of the Trustee to do things enumerated in this
Agreement shall not be construed as a duty and, in the absence of bad
faith on the part of the Trustee, or manifest error, the Trustee may
conclusively rely upon any certificates or opinions furnished to the
Trustee and conforming to the requirements of this Agreement as to the
truth of the statements made and the correctness of the opinions
expressed therein;
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(ii) The Trustee shall not be
personally liable for an error of judgment made in good faith by an
Authorized Officer of the Trustee, unless it shall be proved that the
Trustee shall have been negligent in ascertaining the pertinent facts;
and
(iii) The Trustee shall not be
personally liable with respect to any action taken, suffered, or
omitted to be taken in good faith in accordance with this Agreement
or at the direction of the Holders of Certificates evidencing not less
than 25% of the sum of the Class A Certificate Balance and the Class B
Certificate Balance voting as a single class, relating to the time,
method, and place of conducting any proceeding or any remedy available
to the Trustee, or exercising any trust or power conferred upon the
Trustee, under this Agreement.
The Trustee shall not be required to expend or risk its own
funds or otherwise incur financial liability in the performance of any of its
duties hereunder, or in the exercise of any of its rights or powers, if there
shall be reasonable ground for believing that the repayment of such funds or
adequate indemnity against such risk or liability shall not be reasonably
assured to it, and none of the provisions contained in this Agreement shall in
any event require the Trustee to perform, or be responsible for the manner of
performance of, any of the obligations of the Servicer (including its
obligations as custodian) under this Agreement except during such time, if any,
as the Trustee shall be the successor to, and be vested with the rights, duties,
powers and privileges of, the Servicer in accordance with the terms of this
Agreement.
The Trustee shall not be charged with knowledge of an Event of
Servicing Termination until such time as an Authorized Officer shall have actual
knowledge or have received written notice thereof.
Except for actions expressly authorized by this Agreement or,
based upon an Opinion of Counsel, in the best interests of Certificateholders,
the Trustee shall take no action reasonably likely to impair the security
interests created or existing under any Receivable or to impair the value of any
Receivable.
All information obtained by the Trustee regarding the Obligors
and the Receivables, whether upon the exercise of its rights under this
Agreement or otherwise, shall be maintained by the Trustee in confidence and
shall not be disclosed to any other Person, other than its counsel, unless such
disclosure is pursuant to the terms of this Agreement or required by any
applicable law or regulation.
In the event that the Paying Agent or the Transfer Agent and
Certificate Registrar shall fail to perform any
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obligation, duty or agreement in the manner or on the day required to be
performed by the Paying Agent or the Transfer Agent and Certificate Registrar,
as the case may be, under this Agreement, the Trustee shall be obligated
promptly upon an Authorized Officer obtaining knowledge thereof to perform such
obligation, duty or agreement in the manner so required to the extent the
information necessary to such performance is reasonably available to the Trustee
after the Trustee has made a reasonable effort to obtain such information. The
Trustee shall not be liable for the acts or omissions of any Paying Agent, any
Authenticating Agent or the Transfer Agent and Certificate Registrar appointed
hereunder with due care by the Trustee hereunder.
SECTION 10.2. Trustee's Assignment of Repurchased Receivables
and Trustee's Certificate. With respect to all Receivables repurchased by the
Seller pursuant to Section 3.2 or purchased by the Servicer pursuant to Section
4.7 or 11.2, the Trustee shall (i) assign, without recourse, representation, or
warranty, to the Seller or the Servicer, as the case may be, all the Trust's
right, title, and interest in and to such Receivable and the other property
conveyed to the Trust pursuant to Section 2.1 with respect to such Receivable,
and all security and documents relating thereto, such assignment being an
assignment outright and not for security and (ii) as soon as practicable after
each date as of which a Receivable shall be assigned to the Seller or the
Servicer, as the case may be, execute a Trustee's Certificate, including the
date of execution of such Trustee's Certificate and the date of the related
Agreement, and accompanied by a copy of the Servicer's Certificate specified for
the related Collection Period. If, in any enforcement suit or legal proceeding,
it shall be held that the Servicer may not enforce a Receivable on the ground
that it shall not be a real party in interest or a holder entitled to enforce
the Receivable, the Trustee shall, at the Servicer's expense, take such steps as
the Trustee or the Servicer deems necessary to enforce the Receivable, including
bringing suit in the Trustee's name or the names of the Trust or the
Certificateholders.
SECTION 10.3. Certain Matters Affecting the Trustee.
Except as otherwise provided in Section 10.1:
(i) The Trustee may request, and may
rely and shall be protected in acting or refraining from acting upon
any resolution, certificate of auditors or any other certificate,
statement, instrument, opinion, report, notice, request, consent,
order, appraisal, bond, or other paper or document (including the
annual auditor's report and the letter of independent certified public
accountants described in Section 4.11, the Servicer's Certificate
described in Section 4.9, and the annual compliance statement described
in Section 4.10) believed by it to be genuine and to have been signed
or presented by the proper party or parties.
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(ii) The Trustee may consult with
counsel and any written advice or Opinion of Counsel shall be full and
complete authorization and protection in respect of any action taken
or suffered or omitted by it under this Agreement in good faith and
in accordance with such written advice or Opinion of Counsel. A copy
of such written advice or Opinion of Counsel shall be provided to the
Seller, the Servicer and the Rating Agencies.
(iii) The Trustee shall be under no
obligation to exercise any of the rights or powers vested in it by this
Agreement, or to institute, conduct or defend any litigation under this
Agreement or in relation to this Agreement, at the request, order or
direction of any of the Certificateholders pursuant to the provisions
of this Agreement, unless such Certificateholders shall have offered to
the Trustee reasonable security or indemnity against the costs,
expenses, and liabilities that may be incurred therein or thereby;
provided, however, that the Trustee shall have the right to decline to
follow any such request, order or direction if the Trustee, in
accordance with an Opinion of Counsel, determines that the action or
proceeding may not lawfully be taken or if the Trustee in good faith
determines that the action or proceeding so directed would involve it
in personal liability or be unjustly prejudicial to the non-assenting
Certificateholders; provided, further, that nothing contained in this
Agreement shall relieve the Trustee of the obligations, upon the
occurrence of an Event of Servicing Termination (that shall not have
been cured), to exercise such of the rights and powers vested in it by
this Agreement, and to use the same degree of care and skill in their
exercise as a prudent man would exercise or use under the circumstances
in the conduct of his own affairs.
(iv) The Trustee shall not be
personally liable for any action taken, suffered or omitted by it in
good faith and believed by it to be authorized or within the
discretion or rights or powers conferred upon it by this Agreement.
(v) The Trustee may execute any of the
trusts or powers hereunder or perform any duties under this Agreement
either directly or by or through agents or attorneys or a custodian,
which agents or attorneys shall have any or all of the rights, powers,
duties and obligations of the Trustee conferred on them by such
appointment.
SECTION 10.4. Trustee Not Liable for Certificates or
Receivables. The recitals contained in this Agreement and in the Certificates
shall be taken as the statements of the Seller or the Servicer, as the case may
be, and the Trustee assumes no responsibility for the correctness thereof. The
Trustee shall make no representations as to the validity or sufficiency of this
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Agreement or of the Certificates (other than execution by the Trustee on behalf
of the Trust of, or the authentication on, the Certificates), or of any
Receivable or related document. The Trustee shall have no obligation to perform
any of the duties of the Seller or Servicer unless explicitly set forth in this
Agreement. The Trustee shall at no time have any responsibility or liability for
or with respect to the legality, validity, and enforceability of any security
interest in any Financed Vehicle or any Receivable, or the perfection and
priority of such a security interest or the maintenance of any such perfection
and priority; the filing of any financing or continuation statement in any
public office; the preparation or filing of any report or statement with the
Securities and Exchange Commission; the efficacy of the Trust or its ability to
generate the payments to be distributed to Certificateholders under this
Agreement; the existence, condition, location, and ownership of any Financed
Vehicle; the existence and enforceability of any theft and physical damage
insurance or credit life or credit disability insurance; the existence and
contents of any Receivable or any computer or other record thereof; the validity
of the assignment of any Receivable to the Trust or of any intervening
assignment; the completeness of any Receivable; any claim or default asserted
against a Receivable; the performance or enforcement of any Receivable; the
compliance by the Seller with any warranty or representation made under this
Agreement or in any related document and the accuracy of any such warranty or
representation (except after the Trustee's receipt of notice or other discovery
of any noncompliance therewith or any breach thereof or as otherwise provided
herein); the satisfaction of any conditions relating to the Receivables; any
investment of monies by the Servicer or any loss resulting therefrom (it being
understood that the Trustee shall remain responsible for any Trust property that
it may hold); the acts or omissions of the Seller, the Servicer (including in
its capacity as custodian hereunder), or any Obligor; an action of the Servicer
taken in the name of the Trustee; or any action by the Trustee taken at the
instruction of the Servicer; provided, however, that the foregoing shall not
relieve the Trustee of its obligation to perform its duties under this
Agreement. Except with respect to a claim based on the failure of the Trustee to
perform its duties under this Agreement or based on the Trustee's wilful
misconduct, negligence, or bad faith, or based on the Trustee's breach of a
representation and warranty specified in Section 10.13, no recourse shall be had
for any claim or defense based on any provision of this Agreement, the
Certificates, or any Receivable or assignment thereof against the Trustee in its
individual capacity. The Trustee shall not have any personal obligation,
liability, or duty whatsoever to any Certificateholder or any other Person with
respect to any such claim or defense, and any such claim or defense shall be
asserted solely against the Trust or any indemnitor who shall furnish indemnity
as provided in this Agreement. The Trustee shall not be accountable for the use
or application by the Seller of any of the Certificates or of the proceeds of
such
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Certificates, or for the use or application of any funds paid to the Servicer in
respect of the Receivables.
SECTION 10.5. Trustee May Own Certificates. The Trustee in its
individual or any other capacity may become the owner or pledgee of Certificates
and may deal with the Seller and the Servicer in banking transactions with the
same rights as it would have if it were not Trustee.
SECTION 10.6. Trustee's Fees and Expenses. The Servicer shall
covenant and agree to pay to the Trustee, and the Trustee shall be entitled to,
reasonable compensation (which shall not be limited by any provision of law in
regard to the compensation of a trustee of an express trust) for all services
rendered by it in the execution of the trusts created by this Agreement and in
the exercise and performance of any of the powers and duties under this
Agreement of the Trustee, and the Servicer shall pay or reimburse the Trustee
upon its request for all reasonable expenses, disbursements, and advances
(including the reasonable compensation and the expenses and disbursements of its
counsel and of all persons not regularly in its employ) incurred or made by the
Trustee under this Agreement (including expenses, disbursements, and advances
incurred in defense of any action brought against it in connection with this
Agreement) except any such expense, disbursement, or advance as may arise from
its negligence, wilful misfeasance, or bad faith or that is the responsibility
of Certificateholders under this Agreement. The Servicer's obligation to pay
such compensation and expenses shall survive the termination of such Servicer to
the extent that such obligation is a result of services rendered prior to such
Servicer's termination. Additionally, the Servicer, pursuant to Section 10.7,
shall indemnify the Trustee with respect to certain matters, and
Certificateholders, pursuant to Section 12.3, shall upon the circumstances
therein set forth, indemnify the Trustee under certain circumstances. The
provisions of this Section 10.6 shall survive the termination of this Agreement
and the resignation or removal of the Trustee.
SECTION 10.7. Indemnity of Trustee. The Trustee and it agents
and employees shall be indemnified by the Servicer and held harmless against any
loss, liability, or expense (including reasonable attorneys' fees and expenses
and expenses of litigation) arising out of or incurred in connection with the
acceptance or performance of the trusts and duties contained in this Agreement
to the extent that (i) such loss, liability, or expense shall not have been
incurred by reason of the Trustee's wilful misfeasance, bad faith, or
negligence, and (ii) such loss, liability, or expense shall not have been
incurred by reason of the Trustee's breach of its representations and warranties
pursuant to Section 10.13; provided, however, that the obligations of the
Servicer in this Section 10.7 shall survive such Servicer's termination with
respect to the performance of such Servicer prior to such Servicer's
termination; provided, further, that if the Servicer fails to indemnify the
Trustee and
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its agents and employees pursuant to this Section 10.7, then such indemnity
shall be provided from amounts distributable to the Seller from the Reserve
Account pursuant to Section 5.6(e) (other than Investment Earnings) after all
payments required to be made on such date to the Servicer and the
Certificateholders shall have been made and any amounts required to be retained
therein to maintain the amount on deposit in the Reserve Account (exclusive of
Investment Earnings) in an amount equal to the Specified Reserve Account Balance
on such date shall have been retained. The provisions of this Section 10.7 shall
survive the termination of this Agreement and the resignation or removal of the
Trustee.
SECTION 10.8. Eligibility Requirements for Trustee. The
Trustee under this Agreement shall at all times be a state banking corporation
or national banking association organized and doing business under the laws of
such state or the United States of America; authorized under such laws to
exercise corporate trust powers; and having a combined capital and surplus of at
least $100,000,000 as of the last day of the most recent fiscal quarter for such
institution and subject to supervision or examination by federal or state
authorities. If such corporation or national banking association shall publish
reports of condition at least annually, pursuant to law or to the requirements
of the aforesaid supervising or examining authority, then for the purpose of
this Section 10.8, the combined capital and surplus of such corporation shall be
deemed to be its combined capital and surplus as set forth in its most recent
report of condition so published. The long-term unsecured debt of the Trustee
shall at all times be rated not lower than "BBB-" by Standard & Poor's and Fitch
(if rated by Fitch) and "Baa3" by Moody's or such other ratings as are
acceptable to the Rating Agencies. In case at any time the Trustee shall cease
to be eligible in accordance with the provisions of this Section 10.8, the
Trustee shall resign immediately in the manner and with the effect specified in
Section 10.9.
SECTION 10.9. Resignation or Removal of Trustee. The
Trustee may at any time resign and be discharged from the trusts hereby created
by giving written notice thereof to the Servicer. Upon receiving such notice of
resignation, the Servicer shall promptly appoint a successor Trustee by written
instrument, in duplicate, one copy of which instrument shall be delivered to the
resigning Trustee and one copy to the successor Trustee. If no successor
Trustee shall have been so appointed and have accepted appointment within 30
days after the giving of such notice of resignation, the resigning Trustee may
petition any court of competent jurisdiction for the appointment of a successor
Trustee. The Servicer shall provide notice to the Rating Agencies of any
resignation of the Trustee.
If at any time the Trustee shall cease to be eligible in
accordance with the provisions of Section 10.8 and shall fail to resign after
written request therefor by the Servicer, or if at any time the Trustee shall be
legally unable to act, or shall
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be adjudged a bankrupt or insolvent, or a receiver of the Trustee or of its
property shall be appointed, or any public officer shall take charge or control
of the Trustee or of its property or affairs for the purpose of rehabilitation,
conservation, or liquidation, then the Servicer may remove the Trustee. If it
shall remove the Trustee under the authority of the immediately preceding
sentence, the Servicer shall promptly appoint a successor Trustee by written
instrument, in duplicate, one copy of which instrument shall be delivered to the
Trustee so removed and one copy to the successor Trustee.
Any resignation or removal of the Trustee and appointment of a
successor Trustee pursuant to any of the provisions of this Section 10.9 shall
not become effective until acceptance of appointment by the successor Trustee
pursuant to Section 10.10.
SECTION 10.10. Successor Trustee. Any successor Trustee
appointed pursuant to Section 10.9 shall execute, acknowledge, and deliver to
the Servicer and to its predecessor Trustee an instrument accepting such
appointment under this Agreement, and thereupon the resignation or removal of
the predecessor Trustee shall become effective and such successor Trustee,
without any further act, deed or conveyance, shall become fully vested with all
the rights, powers, duties, and obligations of its predecessor under this
Agreement, with like effect as if originally named as Trustee. The predecessor
Trustee shall deliver to the successor Trustee all documents and statements held
by it under this Agreement and the Servicer and the predecessor Trustee shall
execute and deliver such instruments and do such other things as may reasonably
be required for fully and certainly vesting and confirming in the successor
Trustee all such rights, powers, duties, and obligations.
No successor Trustee shall accept appointment as provided in
this Section 10.10 unless at the time of such acceptance such successor Trustee
shall be eligible pursuant to Section 10.8.
Upon acceptance of appointment by a successor Trustee pursuant
to this Section 10.10, the Servicer shall mail notice of the successor of such
Trustee under this Agreement to all Certificateholders at their respective
addresses of record, to the Rating Agencies. If the Servicer shall fail to mail
such notice within 10 days after acceptance of appointment by successor Trustee,
the successor Trustee shall cause such notice to be mailed at the expense of the
Servicer.
SECTION 10.11. Merger or Consolidation of Trustee. Any
corporation or other entity (i) into which the Trustee may be merged or
consolidated, (ii) which may result from any merger, conversion, or
consolidation to which the Trustee shall be a party, or (iii) which may succeed
to all or substantially all of
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the corporate trust business of the Trustee, which corporation or other entity
executes an agreement of assumption to perform every obligation of the Trustee
under this Agreement, shall be the successor of the Trustee hereunder, provided
such corporation or other entity shall be eligible pursuant to Section 10.8,
without the execution or filing of any instrument or any further act on the part
of any of the parties hereto. The Trustee shall provide prompt written notice of
any merger or consolidation to the Seller, the Servicer, the Collateral Agent
and the Rating Agencies.
SECTION 10.12. Appointment of Co-Trustee or Separate Trustee.
Notwithstanding any other provisions of this Agreement, at any time, for the
purpose of meeting any legal requirements of any jurisdiction in which any part
of the Trust or any Financed Vehicle may at the time be located, the Servicer
and the Trustee acting jointly shall have the power and shall execute and
deliver all instruments to appoint one or more Persons approved by the Trustee
to act as co-trustee, jointly with the Trustee, or separate trustee or separate
trustees, of all or any part of the Trust, and to vest in such Person, in such
capacity and for the benefit of the Certificateholders, such title to the Trust,
or any part thereof, and, subject to the other provisions of this Section 10.12,
such powers, duties, obligations, rights, and trusts as the Servicer and the
Trustee may consider necessary or desirable. The Servicer will pay all
reasonable fees and expenses of any co-trustee or separate trustee or separate
trustees. The appointment of any separate trustee or co-trustee shall not
absolve the Trustee of its obligations under this Agreement. If the Servicer
shall not have joined in such appointment within 15 days after the receipt by it
of a request so to do, or in the case an Event of Servicing Termination shall
have occurred and be continuing, the Trustee alone shall have the power to make
such appointment. No co-trustee or separate trustee or separate trustees under
this Agreement shall be required to meet the terms of eligibility as a successor
trustee pursuant to Section 10.8, and no notice to Certificateholders of the
appointment of any co-trustee or separate trustee or separate trustees shall be
required pursuant to Section 10.10.
Each separate trustee and co-trustee shall, to the extent
permitted by law, be appointed and act subject to the following provisions and
conditions:
(i) All rights, powers, duties, and obliga-
tions conferred or imposed upon the Trustee shall be conferred upon and
exercised or performed by the Trustee and such separate trustee or
co-trustee jointly (it being understood that such separate trustee or
co-trustee is not authorized to act separately without the Trustee
joining in such act), except to the extent that under any law of any
jurisdiction in which any particular act or acts are to be performed
(whether as Trustee under this Agreement or as successor to the
Servicer under this Agreement), the Trustee
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shall be incompetent or unqualified to perform such act or acts, in
which event such rights, powers, duties, and obligations (including the
holding of title to the Trust or any portion thereof in any such
jurisdiction) shall be exercised and performed singly by such separate
trustee or co-trustee, but solely at the direction of the Trustee.
(ii) No trustee under this Agreement shall
be personally liable by reason of any act or omission of any
other trustee under this Agreement.
(iii) The Servicer and the Trustee acting
jointly may at any time accept the resignation of or remove any
separate trustee or co-trustee, except that, following the occurrence
of an Event of Servicing Termination which has not been cured, the
Trustee acting alone may accept the resignation of or remove any
separate trustee or co-trustee.
Any notice, request or other writing given to the Trustee
shall be deemed to have been given to each of the then separate trustees and
co-trustees, as effectively as if given to each of them. Every instrument
appointing any separate trustee or co-trustee shall refer to this Agreement and
the conditions of this Article X. Each separate trustee and co-trustee, upon its
acceptance of the trusts conferred, shall be vested with the estates or
properties specified in its instrument of appointment, either jointly with the
Trustee or separately, as may be provided therein, subject to all the provisions
of this Agreement, specifically including every provision of this Agreement
relating to the conduct of, affecting the liability of, or affording protection
to, the Trustee. Each such instrument shall be filed with the Trustee and a copy
thereof given to the Servicer.
Any separate trustee or co-trustee may at any time appoint the
Trustee, its agent or attorney-in-fact with full power and authority, to the
extent not prohibited by law, to do any lawful act under or in respect of this
Agreement on its behalf and in its name. If any separate trustee or co-trustee
shall die, become incapable of acting, resign or be removed, all of its estates,
properties, rights, remedies and trusts shall vest in and be exercised by the
Trustee, to the extent permitted by law, without the appointment of a new or
successor Trustee.
SECTION 10.13. Representations and Warranties of
Trustee. The Trustee makes the following representations and
warranties on which the Seller, the Servicer and the
Certificateholders may rely:
(i) Organization and Good Standing. The
Trustee is a banking association duly organized, validly existing, and
in good standing under the laws of the United States of America.
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(ii) Power and Authority. The Trustee has
full power, authority and legal right to execute, deliver, and perform
this Agreement, and has taken all necessary action to authorize the
execution, delivery, and performance by it of this Agreement.
(iii) No Violation. The execution, delivery
and performance by the Trustee of this Agreement (a) does not violate
any provision of any law governing the trust powers of the Trustee or,
to the best of the Trustee's knowledge, any order, writ, judgment, or
decree of any court, arbitrator, or governmental authority applicable
to the Trustee or any of its assets, (b) does not violate any provision
of the articles of association or bylaws of the Trustee and (c) does
not conflict with, result in any breach of any of the terms or
provisions of, or constitute (with or without notice or lapse of time)
a default under, any indenture, agreement or other instrument to which
the Trustee is a party or by which it is bound to the extent such
conflict, breach or default would impair the Trustee's obligation or
ability to perform under this Agreement.
(iv) No Governmental Authorization Required.
The execution, delivery and performance by the Trustee of this
Agreement does not require the authorization, consent, or approval of,
the giving of notice to, the filing or registration with, or the taking
of any other action in respect of, any governmental authority or agency
regulating the corporate trust activities of the Trustee.
(v) Due Authorization, Execution and
Delivery. This Agreement has been duly authorized, executed and
delivered by the Trustee and shall constitute the legal, valid, and
binding agreement of the Trustee, enforceable in accordance with its
terms.
SECTION 10.14. Tax Returns. The Servicer shall prepare or
shall cause to be prepared any tax returns required to be filed by the Trust and
furnish to Certificateholders any information required by the Code or the
regulations thereunder and shall remit such returns to the Trustee for signature
at least five days before such returns are due to be filed. The Trustee, upon
request, will furnish the Servicer with all such information known to the
Trustee as may be reasonably required in connection with the preparation of all
tax returns of the Trust, and shall, upon request, execute such returns.
SECTION 10.15. Trustee May Enforce Claims Without Possession
of Certificates. All rights of action and claims under this Agreement or the
Certificates may be prosecuted and enforced by the Trustee without the
possession of any of the Certificates or the production thereof in any
proceeding relating thereto, and any such proceeding instituted by the Trustee
shall be brought in its own name or in its capacity as Trustee. Any
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recovery of judgment shall, after provision for the payment of the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agents
and counsel, be for the ratable benefit of the Certificateholders in respect of
which such judgment has been recovered.
SECTION 10.16. Suits for Enforcement. In case an Event of
Servicing Termination or other default by the Servicer or the Seller hereunder
shall occur and be continuing, the Trustee, in its discretion, may proceed to
protect and enforce its rights and the rights of the Certificateholders under
this Agreement by a suit, action or proceeding in equity or at law or otherwise
whether for the specific performance of any covenant or agreement contained in
this Agreement or in aid of the execution of any power granted in this Agreement
or the enforcement of any other legal, equitable or other remedy, as the
Trustee, being advised by counsel, shall deem most effectual to protect and
enforce any of the rights of the Trustee or the Certificateholders.
SECTION 10.17. Maintenance of Office or Agency. The
Trustee shall maintain at its expense in The City of New York an office or
offices or agency or agencies where notices and demands to or upon the Trustee
in respect of the Certificates and this Agreement may be served. The Trustee
initially designates _______________________ as its office for such purposes.
The Trustee will give prompt written notice to the Servicer, the Paying Agent,
the Transfer Agent and Certificate Registrar and to Certificateholders of any
change in the location of such office or agency.
SECTION 10.18 [_____________________________ __________], as
Collateral Agent. Notwithstanding anything in this Agreement to the contrary,
references in this Article X to the Trustee shall also refer to
[_________________________ ______________], in its capacity as Collateral Agent
hereunder.
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ARTICLE XI
TERMINATION
SECTION 11.1. Termination of the Trust. The Trust, and the
respective obligations and responsibilities of the Seller, the Servicer and the
Trustee shall terminate with respect to the Certificateholders upon the first to
occur of (i) the Distribution Date next succeeding the Collection Period which
is six months after the maturity or other liquidation of the last Receivable and
the disposition of any amounts received upon liquidation of any property
remaining in the Trust and (ii) the payment to Certificateholders of all amounts
required to be paid to them pursuant to this Agreement; provided, however, that
in no event shall the Trust created by this Agreement continue beyond the
expiration of 21 years from the death of the last survivor of the descendants of
Joseph P. Kennedy, the late ambassador to the Court of St. James's, living on
the date of this Agreement. The Servicer shall promptly (but in any event not
later than the first day of the month of the specified Distribution Date) notify
the Trustee, the Paying Agent, the Transfer Agent and Certificate Registrar and
the Rating Agencies in writing of any prospective termination pursuant to this
Section 11.1.
Notice of any termination, specifying the Distribution Date
upon which the Certificateholders may surrender their Certificates to the
Transfer Agent and Certificate Registrar for payment of the final distribution
and cancellation, shall be given promptly by the Trustee by letter to
Certificateholders mailed not earlier than the 15th day and not later than the
25th day of the Collection Period related to the specified Distribution Date
stating that the Record Date otherwise applicable to such Distribution Date is
not applicable, payments being made only upon presentation and surrender of the
Certificates at the office of the Transfer Agent and Certificate Registrar
therein specified. The Trustee shall give such notice to the Transfer Agent and
Certificate Registrar, the Paying Agent and the Rating Agencies at the time such
notice is given to Certificateholders. Upon presentation and surrender of the
Certificates, the Paying Agent shall cause to be distributed to
Certificateholders amounts distributable on such Distribution Date pursuant to
Section 5.5. Upon notification by the Seller, any funds in the Collection
Account after the payment of all amounts owing to the Certificateholders shall
be paid to the Seller.
In the event that all of the Certificateholders shall not
surrender their Certificates for cancellation within six months after the date
specified in the above-mentioned written notice, the Trustee shall give a second
written notice to the remaining Certificateholders upon receipt of the
appropriate records from the Transfer Agent and Certificate Registrar to
surrender their Certificates for cancellation and receive the final distribution
with respect thereto. If within one year
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after the second notice all the Certificates shall not have been surrendered for
cancellation, the Trustee may take appropriate steps, or may appoint an agent to
take appropriate steps, to contact the remaining Certificateholders concerning
surrender of their Certificates, and the cost thereof shall be paid out of the
funds and other assets that shall remain subject to this Agreement. Any funds
remaining in the Trust after exhaustion of such remedies shall be distributed by
the Trustee or the Trustee shall cause to be distributed to the United Way or a
similar charitable organization located or operating in the New York
metropolitan area, as specified by the Servicer; provided, however, that such
funds shall be distributed by the Trustee or the Trustee shall cause to be
distributed no later than three years after the final Distribution Date
specified in the notice referred to in the preceding paragraph.
All Certificates surrendered for payment of the final
distribution with respect to such Certificates and cancellation shall be
cancelled by the Transfer Agent and Certificate Registrar and shall be disposed
of in a manner satisfactory to the Trustee and the Seller.
SECTION 11.2. Optional Purchase of All Receivables. As of the
last day of any Collection Period on which the Pool Balance shall be equal to or
less than the Optional Purchase Percentage, the Servicer shall have the option
to purchase the corpus of the Trust. To exercise such option, the Servicer shall
notify the Trustee, the Paying Agent, the Transfer Agent and Certificate
Registrar in writing, no later than the 25th day of such Collection Period,
shall pay the aggregate Repurchase Amount for the Receivables (including
Defaulted Receivables) as of such last day and shall succeed to all interests
in, to and under the Trust property. The payment shall be made in the manner
specified in Section 5.4, and shall be distributed pursuant to Section 5.5. The
Trustee shall not permit the purchase of the corpus of the Trust pursuant to
this Section unless (i) the Servicer's long-term unsecured debt is rated at the
time of such purchase at least "BBB-" by Standard & Poor's and Fitch (if rated
by Fitch) and "Baa3" by Moody's or (ii) the Servicer provides to the Trustee an
Opinion of Counsel in form reasonably satisfactory to the Trustee and in form
and substance satisfactory to the Rating Agencies to the effect that such
purchase will not constitute a fraudulent transfer under applicable state and
federal law.
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ARTICLE XII
MISCELLANEOUS PROVISIONS
SECTION 12.1. Amendment. This Agreement may be amended by the
Seller, the Servicer, the Trustee and the Collateral Agent, with prior notice to
the Rating Agencies but without prior notice to or the consent of any of the
Certificateholders, (i) to cure any ambiguity, to correct or supplement any
provisions in this Agreement or the Certificates which may be inconsistent with
any other provisions herein or therein, to evidence a succession to the Servicer
or the Seller pursuant to this Agreement or to add any other provisions with
respect to matters or questions arising under this Agreement that shall not be
inconsistent with the provisions of this Agreement; provided, however, that such
action shall not, as evidenced by an Officer's Certificate and/or an Opinion of
Counsel reasonably acceptable and delivered to the Trustee, adversely and
materially affect the interests of the Trust or any of the Certificateholders
and provided, further, that the Servicer shall deliver written notice of such
changes to each Rating Agency prior to the execution of any such amendment, or
(ii) to effect a transfer or assignment in compliance with Section 12.7(a).
Notwithstanding the foregoing, no amendment modifying the provisions of Section
5.5 or Article VI shall become effective without satisfaction of the Rating
Agency Condition.
This Agreement may also be amended from time to time by the
Seller, the Servicer, the Trustee and the Collateral Agent, with the consent of
the Holders of Certificates evidencing not less than a majority of the sum of
the Class A Certificate Balance and the Class B Certificate Balance voting as a
single class, for the purpose of adding any provisions to or changing in any
manner or eliminating any of the provisions of this Agreement, or of modifying
in any manner the rights of the Certificateholders (including effecting a
transfer or assignment in compliance with Section 12.7(a) of this Agreement);
provided, however, that no such amendment, except with the consent of the
Holders of all Certificates then outstanding, shall (a) increase or reduce in
any manner the amount of, or accelerate or delay the timing of, collections of
payments of Receivables, or distributions that shall be required to be made on
any Certificate, (b) reduce the aforesaid percentage of the sum of the Class A
Certificate Balance and the Class B Certificate Balance, the Holders of which
are required to consent to any such amendment or (c) materially and adversely
affect the interests of either the Class A Certificateholders or the Class B
Certificateholders without the consent of the Holders of Class A Certificates or
Class B Certificates, as the case may be, evidencing not less than a majority of
the Class A Certificate Balance or the Class B Certificate Balance, as the case
may be.
Promptly after the execution of any amendment or
consent referred to in this Section 12.1, the Trustee shall
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furnish a copy of such amendment or consent to each Certificateholder and to
the Rating Agencies.
It shall not be necessary for the consent of
Certificateholders pursuant to this Section 12.1 to approve the particular form
of any proposed amendment or consent, but it shall be sufficient if such consent
shall approve the substance thereof. The manner of obtaining such consents and
of evidencing the authorization of the execution thereof by Certificateholders
shall be subject to such reasonable requirements as the Trustee may prescribe.
Prior to the execution of any amendment to this Agreement, the
Trustee shall be entitled to receive and rely upon an Opinion of Counsel stating
that the execution of such amendment is authorized or permitted by this
Agreement. The Trustee shall not be obligated to enter into any such amendment
which affects the Trustee's own rights, duties or immunities under this
Agreement.
Prior to the execution of any amendment to this Agreement,
other than an amendment permitted pursuant to clause (i) of the first paragraph
of this Section 12.1, such amendment is required to satisfy the Rating Agency
Condition.
SECTION 12.2. Protection of Title to Trust.
(a) The Seller shall execute and file such fi-
nancing statements and cause to be executed and filed such continuation
statements, all in such manner and in such places as may be required by law
fully to preserve, maintain, and protect the interests of the Trustee and the
Collateral Agent under this Agreement in the Receivables and in the proceeds
thereof. The Seller shall deliver (or cause to be delivered) to the Trustee or
the Collateral Agent, as applicable, file-stamped copies of, or filing receipts
for, any document filed as provided above, as soon as available following such
filing.
(b) Neither the Seller nor the Servicer shall
change its name, identity, or corporate structure in any manner that would,
could, or might make any financing statement or continuation statement filed by
the Seller on behalf of the Trustee or the Collateral Agent in accordance with
paragraph (a) above seriously misleading within the meaning of ss. 9-402(7) (or
any comparable section) of the Relevant UCC, unless it shall have given the
Trustee or the Collateral Agent, as applicable, at least 30 days prior written
notice thereof.
(c) The Seller and the Servicer shall give the
Trustee and the Collateral Agent at least 60 days prior written notice of any
relocation of its principal executive office if, as a result of such relocation,
the applicable provisions of the Relevant UCC would require the filing of any
amendment of any previously filed financing or continuation statement or of any
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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 re-
cords as to each Receivable accurately and in sufficient detail to permit (i)
the reader thereof to know at any time the status of such Receivable, including
payments and recoveries made and payments owing (and the nature of each) and
(ii) reconciliation between payments or recoveries on (or with respect to) each
Receivable and the amounts from time to time deposited in the Collection Account
in respect of such Receivable.
(e) The Servicer shall maintain its computer
sys- tems so that, from and after the time of sale under this Agreement of the
Receivables to the Trustee, the Servicer's master computer records (including
archives) that shall refer to a Receivable indicate clearly, by numerical code
or otherwise, that such Receivable is owned by the Trust. Indication of the
Trust's ownership of a Receivable shall be deleted from or modified on the
Servicer's computer systems when, and only when, the Receivable shall have been
paid in full, repurchased or assigned pursuant hereto.
(f) If at any time the Seller or the Servicer
shall propose to sell, grant a security interest in, or otherwise transfer any
interest in a new or used automobile to any prospective purchaser, creditor, or
other transferee, the Seller or the Servicer, as the case may be, shall give to
such prospective purchaser, creditor, or other transferee computer tapes,
records, or print-outs (including any restored from archives) that, if they
shall refer in any manner whatsoever to any Receivable, shall indicate clearly
that such Receivable has been sold and is owned by the Trust.
(g) The Servicer shall permit the Trustee and
its agents upon reasonable notice at any time during normal business hours which
does not unreasonably interfere with the Servicer's normal operations or
customer or employee relations to inspect, audit, and make copies of and
abstracts from the Servicer's records regarding the Receivables.
(h) Upon request, the Servicer shall furnish to
the Trustee, within five Business Days, a list of all Receivables by contract
number and name of Obligor then held as part of the Trust, together with a
reconciliation of such list to the Schedule of Receivables attached as Schedule
A to this Agreement and to each of the Servicer Certificates indicating removal
of Receivables from the Trust.
(i) The Servicer shall deliver to the Trustee
and the Collateral Agent:
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(1) upon the execution and delivery of this Agreement, an
Opinion of Counsel either (a) stating that, in the opinion of such counsel, all
financing statements and continuation statements have been executed and filed
that are necessary fully to preserve and protect the interest of the Trust in
the Receivables and of the Collateral Agent in the Reserve Account, and reciting
the details of such filings or referring to prior Opinions of Counsel in which
such details are given, or (b) stating that, in the opinion of such counsel, no
such action shall be necessary to preserve and protect such interest; and
(2) on or before March 31 of each year, commencing with March
31, ____, an Opinion of Counsel, dated as of such date, either (a) stating that,
in the opinion of such counsel, all financing statements and continuation
statements have been executed and filed that are necessary fully to preserve and
protect the interest of the Trustee in the Receivables, and reciting the details
of such filings or referring to prior opinions of Counsel in which such details
are given, or (b) stating that, in the opinion of such counsel, no such action
shall be necessary to preserve and protect such interest. Notwithstanding the
provisions of Section 12.5, such Opinion of Counsel may be sent by regular
non-certified mail, and such mailed opinion shall be deemed delivered when so
mailed.
(j) The Servicer shall, to the extent required
by applicable law, cause the Certificates to be registered with the Securities
and Exchange Commission pursuant to Section 12(b) or Section 12(g) of the
Exchange Act within the time periods specified in such sections.
(k) For the purpose of facilitating the
execution of this Agreement and for other purposes, this Agreement may be
executed simultaneously in any number of counterparts, each of which
counterparts shall be deemed to be an original, and all of which counterparts
shall constitute but one and the same instrument.
SECTION 12.3. Limitation on Rights of Certificateholders. The
death or incapacity of any Certificateholder shall not operate to terminate this
Agreement or the Trust, nor entitle the Certificateholder's legal
representatives or heirs to claim an accounting or to take any action or
commence any proceeding in any court for a partition or winding up of the Trust,
nor otherwise affect the rights, obligations, and liabilities of the parties to
this Agreement or any of them.
No Certificateholder shall have any right to vote (except as
provided in Section 9.1, Section 9.4, Section 12.1 and this Section 12.3) or in
any manner otherwise control the operation and management of the Trust, or the
obligations of the parties to this Agreement, nor shall anything set forth in
this Agreement or contained in the terms of the Certificates, be
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construed so as to constitute the Holders as partners or members of an
association; nor shall any Certificateholder be under any liability to any third
person by reason of any action taken pursuant to any provision of this
Agreement.
No Certificateholder shall have any right by virtue or by
availing itself of any provisions of this Agreement to institute any suit,
action, or proceeding in equity or at law upon or under or with respect to this
Agreement, unless such Holder previously shall have given to the Trustee a
written notice of default and of the continuance thereof, as hereinbefore
provided, and unless also the Holders of Certificates evidencing not less than
25% of the sum of the Class A Certificate Balance and the Class B Certificate
Balance voting as a single class, shall have made written request upon the
Trustee to institute such action, suit, or proceeding in its own name as Trustee
under this Agreement and shall have offered to the Trustee such reasonable
indemnity as it may require against the costs, expenses, and liabilities to be
incurred therein or thereby, and the Trustee, for 30 days after its receipt of
such notice, request, and offer of indemnity, shall have either neglected or
refused to institute any such action, suit or proceeding; no one or more Holders
of Certificates shall have any right in any manner whatever by virtue or by
availing itself or themselves of any provisions of this Agreement to affect,
disturb, or prejudice the rights of the Holders of any other of the
Certificates, or to obtain or seek to obtain priority over or preference to any
other such Holder, or to enforce any right, under this Agreement, except in the
manner provided in this Agreement and for the equal, ratable, and common benefit
of all Certificateholders. For the protection and enforcement of the provisions
of this Section 12.3, each Certificateholder and the Trustee shall be entitled
to such relief as can be given either at law or in equity.
SECTION 12.4. GOVERNING LAW. THIS AGREEMENT SHALL BE
GOVERNED BY, AND INTERPRETED AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE
STATE OF NEW YORK.
SECTION 12.5. Notices. All demands, notices, and
communications under this Agreement shall be in writing, personally delivered or
mailed by certified mail, return receipt requested, and shall be deemed to have
been duly given upon receipt (a) in the case of the Seller, c/o Chase Automotive
Finance Corporation, 900 Stewart Avenue, Garden City, New York 11530, Attention:
Financial Controller, or at such other address as shall be designated by the
Seller in a written notice to the Trustee, (b) in the case of the Servicer, c/o
Chase Automotive Finance Corporation, 900 Stewart Avenue, Garden City, New York
11530, Attention: Financial Controller, or at such other address as shall be
designated by the Servicer in a written notice to the Trustee, (c) in the case
of the Trustee, at ___________________ ______________ Attention:
_________________ and (d) in the case of the Collateral Agent, at
___________________ ______________
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Attention: _________________. Any notice required or permitted to be mailed to a
Certificateholder shall be given by first class mail, postage prepaid, at the
address of record of such Holder. Any notice to a Certificateholder so mailed
within the time prescribed in this Agreement shall be conclusively presumed to
have been duly given, whether or not the Certificateholder shall receive such
notice. Notices to Obligors pursuant to Section 4.4 herein may be given by first
class mail or by third-class mail, postage prepaid, at the address of record of
such Obligor and shall be deemed received when mailed by the Servicer.
SECTION 12.6. Severability of Provisions. If any one or more
of the covenants, agreements, provisions, or terms of this Agreement shall be
for any reason whatsoever held invalid, then such covenants, agreements,
provisions, or terms shall be deemed severable from the remaining covenants,
agreements, provisions, or terms of this Agreement and shall in no way affect
the validity or enforceability of the other provisions of this Agreement or of
the Certificates or the rights of the Holders thereof.
SECTION 12.7. Assignment. Notwithstanding anything to the
contrary contained herein, except as provided in Sections 7.3, 8.3, 8.5 and 9.2
neither the Seller nor the Servicer may assign all, or a portion of, its rights,
obligations and duties under this Agreement (except as contemplated in
connection with the Proposed Merger and except for the assignment by the Seller
of a portion of its rights and obligations hereunder to Chase) unless such
transfer or assignment satisfies the Rating Agency Condition. Any transfer or
assignment with respect to the Servicer of all of its rights, obligations and
duties will not become effective until a successor Servicer has assumed the
Servicer's rights, duties and obligations under this Agreement.
SECTION 12.8. Certificates Nonassessable and Fully Paid. The
interests represented by the Certificates shall be nonassessable for any losses
or expenses of the Trust or for any reason whatsoever, and, upon authentication
thereof by the Trustee pursuant to Section 6.2, each Certificate shall be deemed
fully paid.
SECTION 12.9. Third-Party Beneficiaries. This Agreement will
inure to the benefit of and be binding upon the parties hereto, the
Certificateholders and the Certificate Owners and their respective successors
and permitted assigns. Except as otherwise provided in this Agreement, no other
person will have any right or obligation hereunder.
SECTION 12.10. Counterparts. This Agreement may be executed in
one or more counterparts and by the different parties hereto on separate
counterparts, each of which, when so executed, shall be deemed to be an
original; such counterparts, together, shall constitute one and the same
agreement.
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SECTION 12.11. Tax Matters. It is intended that the Trust
shall be a grantor trust for federal income tax purposes. All provisions hereof
shall be construed so as to effectuate such intent. In addition, the Seller and
the Certificateholders (by accepting a beneficial interest in a Certificate)
agree to treat the Certificates as representing undivided beneficial ownership
interests in the Receivables (other than the Retained Yield). Moreover, if the
Class B Pass-Through Rate exceeds the Class A Pass-Through Rate, the Seller and
the Certificateholders (by accepting a beneficial interest in a Certificate)
agree to (i) treat the Certificates as representing undivided beneficial
ownership interests in the Receivables (other than the Retained Yield), and (ii)
treat the Class A Certificateholders as having sold, and the Class B
Certificateholders as having purchased, the Class B Stripped Coupon.
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IN WITNESS WHEREOF, the parties have caused this Pooling and
Servicing Agreement to be duly executed by their respective officers as of the
day and year first above written.
CHASE MANHATTAN BANK USA, N.A,
as Seller and Servicer
By____________________________________________________
Name:
Title:
[_____________________________________________________]
not in its individual capacity
but solely as Trustee
By____________________________________________________
Name:
Title:
[_____________________________________________________]
not in its individual capacity
but solely as Collateral Agent
By____________________________________________________
Name:
Title:
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SCHEDULE A
[LIST OF RECEIVABLES]
Delivered to the Trustee on
the Closing Date.
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SCHEDULE B
----------
Location of Receivable Files
----------------------------
Chase Manhattan Bank USA, National Association
20 Clinton Avenue South
5th Floor
SENECA Building
Rochester, New York 14604
Iron Mountain
Route 9-W South
P.O. Box 477
Pt. Ewen, NY 12466
Chase Manhattan Automotive Finance Corporation
900 Stewart Avenue
Garden City, NY 11530
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<PAGE>
EXHIBIT A-1
[FORM OF CLASS A CERTIFICATE]
[UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION, TO ISSUER OR ITS AGENT FOR
REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY CERTIFICATE ISSUED IS
REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY (AND ANY PAYMENT IS
MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY), ANY TRANSFER, PLEDGE, OR OTHER
USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS
THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN].
THIS CERTIFICATE DOES NOT REPRESENT AN INTEREST IN OR OBLIGATION OF CHASE
MANHATTAN BANK USA, N.A. OR ANY AFFILIATE THEREOF. THIS CERTIFICATE AND THE
RECEIVABLES ARE NOT DEPOSITS AND ARE NOT INSURED OR GUARANTEED BY THE FEDERAL
DEPOSIT INSURANCE CORPORATION OR ANY OTHER GOVERNMENTAL AGENCY.
CHASE MANHATTAN AUTO GRANTOR TRUST 199_-_
____% AUTOMOBILE LOAN PASS-THROUGH CERTIFICATE, CLASS A
evidencing a fractional undivided interest in the Trust, as defined
below, the property of which includes a pool of [simple interest]
retail installment sales contracts, purchase money loans and promissory
notes secured by new and used automobiles financed thereby and sold to
the Trustee, as defined below, on behalf of the Trust by Chase
Manhattan Bank USA, National Association.
NUMBER CUSIP
A-1
$---------
THIS CERTIFIES THAT __________ is the registered owner of a
nonassessable, fully paid, fractional undivided interest, in the amount set
forth above, in the Chase Manhattan Auto Grantor Trust 199_-_ (the "Trust")
formed by Chase Manhattan Bank USA, National Association (the "Seller"). The
Trust was created pursuant to a Pooling and Servicing Agreement dated as of
__________ __, ____ (as amended, supplemented or otherwise modified and in
effect from time to time, the "Agreement") between the Seller, acting as Seller
and Servicer, and [___________________________ ____________], as trustee the
"Trustee" and as collateral agent, a summary of certain of the pertinent
provisions of which is set
A-1-1
<PAGE>
forth on the reverse hereof. This Certificate is one of the duly authorized
Certificates designated as "____% Automobile Loan Pass-Through Certificates,
Class A" (herein called "Class A Certificates" and together with the "Class B
Certificates", issued concurrently herewith the "Certificates"). This
Certificate is issued under and is subject to the terms, provisions, and
conditions of the Agreement, to which Agreement the Holder of this Certificate
by virtue of the acceptance hereof assents and by which such Holder is bound.
The property of the Trust includes a pool of [simple interest] retail
installment sales contracts, purchase money notes and promissory notes (the
"Receivables") for the purchase of new and used automobiles financed thereby,
all monies due thereunder on or after the Cutoff Date (other than the Retained
Yield), security interests in the vehicles securing the Receivables (the
"Financed Vehicles"), such amounts as from time to time may be held in the
Collection Account and the Distribution Accounts established and maintained by
the Servicer in the name of the Trustee, the rights to proceeds as a result of
the Seller's exercise of its recourse rights against Dealers with respect to the
Receivables, and assignment of the rights of the Seller to receive proceeds from
any Liquidation Proceeds and from any extended warranties, theft and physical
damage, credit life and credit disability insurance policies relating to the
Financed Vehicles or the Obligors, as the case may be, the rights with respect
to any Financed Vehicle that has been repossessed by the Servicer, on behalf of
the Trustee, and the right to receive payments under certain circumstances from
the Reserve Account and the Retained Yield and all proceeds of the foregoing.
Subject to the terms and conditions of the Agreement
(including the availability of funds for distributions) and until the
obligations created by the Agreement shall have terminated in accordance
therewith, there will be distributed on the 15th day of each month or, if such
15th day is not a Business Day, the next succeeding Business Day (the
"Distribution Date"), commencing on __________, __ ____, to the Person in whose
name this Certificate is registered at the close of business on the related
Record Date, such Certificateholder's fractional undivided interest in the
amounts distributable to Class A Certificateholders on such Distribution Date.
Distributions on this Class A Certificate will be made by the
Paying Agent by check mailed to the Class A Certificateholder of record in the
Certificate Register without the presentation or surrender of this Class A
Certificate or the making of any notation hereon, except that if directed by the
Seller in the case of Class A Certificates registered in the name of a Clearing
Agency or Foreign Clearing Agency, as applicable, distributions will be made in
the form of immediately available funds. Except as otherwise provided in the
Agreement and notwithstanding the above, the final distribution on this Class A
Certificate will be made after due notice by the Trustee of the pendency of such
distribution and only upon presentation and surrender of this Class A
Certificate at the office or agency maintained for that
A-1-2
<PAGE>
purpose by the Transfer Agent and Certificate Registrar in The City of New York.
Reference is hereby made to the further provisions of this
Class A Certificate set forth on the reverse hereof, which further provisions
shall for all purposes have the same effect as if set forth at this place.
All capitalized terms used herein not otherwise defined shall
have the meaning assigned thereto in the Agreement.
Unless the authentication hereon shall have been executed by
an authorized officer of the Trustee or an authenticating agent acting on behalf
of the Trustee, by manual signature, this Class A Certificate shall not entitle
the holder hereof to any benefit under the Agreement or be valid for any
purpose.
A-1-3
<PAGE>
IN WITNESS WHEREOF, the Trustee, on behalf of the Trust, and
not in its individual capacity, has caused this Certificate to be duly executed.
CHASE MANHATTAN AUTO
GRANTOR TRUST 199_-_
By: [__________________________________________],
By: ______________________________________
Authorized Officer
This is one of the Certificates referred to in
the within-mentioned Agreement.
[______________________________________________],
not in its individual
capacity but solely
as Trustee
By: ____________________________________________
Authorized Officer
or
________________________________________________
as Authenticating Agent
for the Trustee
By: ____________________________________________
Authorized Officer
A-1-4
<PAGE>
CHASE MANHATTAN AUTO GRANTOR TRUST ____-_
____% AUTOMOBILE LOAN PASS-THROUGH CERTIFICATES, CLASS A
The Agreement permits, with certain exceptions therein
provided, the amendment thereof and the modification of the rights of the
Certificateholders under the Agreement at any time by the Seller, the Servicer
and the Trustee with the consent of the Holders of Certificates evidencing not
less than a majority of the sum of the Class A Certificate Balance and the Class
B Certificate Balance voting as a single class. Any such consent by the Holder
of this Class A Certificate shall be conclusive and binding on such Holder and
on all future Holders of this Class A Certificate and of any Class A Certificate
issued upon registration of transfer hereof or in exchange hereof or in lieu
hereof whether or not notation of such consent is made upon this Class A
Certificate. The Agreement also permits the amendment thereof, in certain
limited circumstances and with certain exceptions provided therein, without
prior notice to or the consent of the Holders of any of the Certificates.
As provided in the Agreement and subject to certain
limitations therein set forth, the transfer of this Class A Certificate is
registerable in the Certificate Register upon surrender of this Class A
Certificate for registration of transfer at the office or agency maintained by
the Transfer Agent and Certificate Registrar, in The City of New York,
accompanied by a written instrument of transfer in form satisfactory to the
Trustee and the Transfer Agent and Certificate Registrar duly executed by the
Holder hereof, which signature to such assignment has been guaranteed by a
member of the New York Stock Exchange or a commercial bank or trust company, and
thereupon one or more new Class A Certificates of authorized denominations
evidencing the same aggregate interest in the Trust will be issued to the
designated transferee.
The Class A Certificates are issuable only as registered
Certificates without coupons in denominations of $1,000 and integral multiples
thereof (except for a single Class A Certificate in a smaller minimum
denomination representing any residual portion of the
A-1-5
<PAGE>
Original Class A Certificate Balance). As provided in the Agreement and subject
to certain limitations therein set forth, Class A Certificates are exchangeable
for new Class A Certificates of authorized denominations evidencing the same
aggregate denomination, as requested by the Holder surrendering the same. No
service charge will be made for any such registration of transfer or exchange,
but the Transfer Agent and Certificate Agent may require payment of a sum
sufficient to cover any tax or governmental charges payable in connection
therewith.
In the event that the Holder of this Class A Certificate does
not surrender this Class A Certificate for cancellation within six months after
the date specified in the notice regarding the pendency of the final
distribution described on the face hereof, the Trustee shall give a second
notice with respect thereto. If within one year after such second notice this
Class A Certificate shall not have been surrendered for cancellation, the
Trustee may take appropriate steps to contact the Holder hereof. As provided in
the Agreement, any funds remaining in the Trust after exhaustion of such steps
shall be distributed to a charitable organization, such distribution to occur
not later than three years from the date of the final Distribution Date.
The Trustee, the Paying Agent and the Transfer Agent and
Certificate Registrar may treat the Person in whose name this Class A
Certificate is registered as the owner hereof for all purposes, and none of the
Trustee, the Paying Agent or the Transfer Agent and Certificate Registrar shall
be affected by any notice to the contrary.
The obligations and responsibilities created by the Agreement
and the Trust created thereby with respect to the Certificateholders shall
terminate upon the payment to Certificateholders of all amounts required to be
paid to them pursuant to the Agreement on the Distribution Date next succeeding
the month which is six months after the maturity or liquidation of the last
Receivable and the disposition of all property held as part of the Trust. The
Servicer may, at its option, purchase the corpus of the Trust at a price
specified in the Agreement, and such purchase of the Receivables and other
property of the Trust will effect early retirement
A-1-6
<PAGE>
of the Certificates; however, such right of purchase is exercisable only as of
the last day of a Collection Period immediately preceding any Distribution Date
as of which the Pool Balance is equal to or less than 5% of the Original Pool
Balance.
A-1-7
<PAGE>
EXHIBIT A-2
[FORM OF CLASS B CERTIFICATE]
THIS CLASS B CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO THE CLASS A
CERTIFICATES AS DESCRIBED IN THE AGREEMENT (AS DESCRIBED HEREIN).
[UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION, TO ISSUER OR ITS AGENT FOR
REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY CERTIFICATE ISSUED IS
REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY (AND ANY PAYMENT IS
MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY), ANY TRANSFER, PLEDGE, OR OTHER
USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS
THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN. THE CLASS B
CERTIFICATES MAY NOT BE ACQUIRED BY OR FOR THE ACCOUNT OF (I) AN EMPLOYEE
BENEFIT PLAN (AS DEFINED IN SECTION 3(3) OF THE EMPLOYEE RETIREMENT INCOME
SECURITY ACT OF 1974, AS AMENDED ("ERISA")) WHICH IS SUBJECT TO THE PROVISIONS
OF TITLE I OF ERISA, (II) A PLAN (AS DEFINED IN SECTION 4975(E)(1) OF THE CODE
OTHER THAN A GOVERNMENTAL OR CHURCH PLAN DESCRIBED IN SECTION 4975(G)(2) OR (3)
OF THE CODE), OR (III) ANY ENTITY WHOSE UNDERLYING ASSETS INCLUDE "PLAN ASSETS"
BY REASON OF ANY SUCH PLAN'S INVESTMENT IN THE ENTITY (EXCLUDING ANY INVESTMENT
COMPANY THAT IS REGISTERED UNDER THE INVESTMENT COMPANY ACT OF 1940, AS AMENDED)
(EACH, A "BENEFIT PLAN"). BY ACCEPTING AND HOLDING A CLASS B CERTIFICATE, THE
HOLDER THEREOF SHALL BE DEEMED TO HAVE REPRESENTED AND WARRANTED THAT IT IS NOT
A BENEFIT PLAN, AND THAT NO ASSETS OF A BENEFIT PLAN WERE USED TO ACQUIRE SUCH
CLASS B CERTIFICATE. THE FOREGOING RESTRICTIONS SHALL NOT APPLY TO ACQUISITIONS
OF CLASS B CERTIFICATES WITH ASSETS OF THE GENERAL ACCOUNT OF AN INSURANCE
COMPANY, TO THE EXTENT THE ACQUISITION OF THIS CERTIFICATE IS (i) PERMITTED
UNDER SECTION 401(C) OF ERISA AND FINAL RULES AND REGULATIONS THEREUNDER OR
ANOTHER EXEMPTION UNDER ERISA AND (ii) DOES NOT AND WILL
A-2-1
<PAGE>
NOT RESULT IN THE CONTEMPLATED OPERATIONS OF THE TRUST BEING TREATED AS
NON-EXEMPT TRANSACTIONS].
THIS CERTIFICATE DOES NOT REPRESENT AN INTEREST IN OR OBLIGATION OF CHASE
MANHATTAN BANK USA, N.A. OR ANY AFFILIATE THEREOF. THIS CERTIFICATE AND THE
RECEIVABLES ARE NOT DEPOSITS AND ARE NOT INSURED OR GUARANTEED BY THE FEDERAL
DEPOSIT INSURANCE CORPORATION OR ANY OTHER GOVERNMENTAL AGENCY.
CHASE MANHATTAN AUTO GRANTOR TRUST 199_-_
____% AUTOMOBILE LOAN PASS-THROUGH CERTIFICATE, CLASS B
evidencing a fractional undivided interest in the Trust, as defined
below, the property of which includes a pool of [simple interest]
retail installment sales contracts, purchase money loans and promissory
notes, secured by new and used automobiles financed thereby and sold to
the Trustee, as defined below, on behalf of the Trust by Chase
Manhattan Bank USA, National Association.
NUMBER CUSIP
B-1
$---------
THIS CERTIFIES THAT __________ is the registered owner of a
nonassessable, fully paid, fractional undivided interest, in the amount set
forth above, in the Chase Manhattan Auto Grantor Trust 199_-_ (the "Trust")
formed by Chase Manhattan Bank USA, National Association (the "Seller"). The
Trust was created pursuant to a Pooling and Servicing Agreement dated as of
__________ __, ____ (as amended, supplemented or otherwise modified and in
effect from time to time, the "Agreement") between the Seller, acting as Seller
and Servicer, and [__________________________ _____________], as trustee (the
"Trustee") and as collateral agent, a summary of certain of the pertinent
provisions of which is set forth on the reverse hereof. This Certificate is one
of the duly authorized Certificates designated as "____% Automobile Loan
Pass-Through
A-2-2
<PAGE>
Certificates, Class B" (herein called the Class B Certificates, and, together
with the Class A Certificates issued concurrently herewith, the "Certificates").
This Certificate is issued under and is subject to the terms, provisions, and
conditions of the Agreement, to which Agreement the Holder of this Certificate
by virtue of the acceptance hereof assents and by which such Holder is bound.
The property of the Trust includes a pool of [simple interest] retail
installment sales contracts, purchase money notes and promissory notes (the
"Receivables") for the purchase of new and used automobiles financed thereby,
all monies due thereunder on or after the Cutoff Date (other than the Retained
Yield), security interests in the vehicles securing the Receivables (the
"Financed Vehicles"), such amounts as from time to time may be held in the
Collection Account and the Distribution Accounts established and maintained by
the Servicer in the name of the Trustee, the rights to proceeds as a result of
the Seller's exercise of its recourse rights against Dealers with respect to the
Receivables, and assignment of the rights of the Seller to receive proceeds from
any Liquidation Proceeds and from any extended warranties, theft and physical
damage, credit life and credit disability insurance policies relating to the
Financed Vehicles or the Obligors, as the case may be, the rights with respect
to any Financed Vehicle that has been repossessed by the Servicer, on behalf of
the Trustee, and the right to receive payments under certain circumstances from
the Reserve Account and the Retained Yield and all proceeds of the foregoing.
Subject to the terms and conditions of the Agreement
(including the availability of funds for distribution) and until the obligations
created by the Agreement shall have terminated in accordance therewith, there
will be distributed on the 15th day of each month or, if such 15th day is not a
Business Day, the next succeeding Business Day (the "Distribution Date"),
commencing on __________ __ ____, to the Person in whose name this Certificate
is registered at the close of business on the related Record Date, such
Certificateholder's fractional undivided interest in the amounts distributable
to the Class B Certificateholders on such Distribution Date.
A-2-3
<PAGE>
Pursuant to the Agreement distributions of interest and
principal on the Class B Certificates will be subordinated in priority of
payment to interest and principal due on the Class A Certificates in the event
of defaults and delinquencies on the Receivables. The Class B Certificateholders
will not receive any distributions of interest with respect to a Collection
Period until the full amount of interest on the Class A Certificates relating to
such Collection Period has been deposited in the Class A Distribution Account,
and the Class B Certificateholders will not receive any distributions of
principal with respect to such Collection Period until the full amount of
interest on and principal of the Class A Certificates relating to such
Collection Period has been deposited in the Class A Distribution Account as set
forth in the Agreement.
Distributions on this Class B Certificate will be made by the
Paying Agent by check mailed to the Class B Certificateholder of record in the
Class B Certificate Register without the presentation or surrender of this Class
B Certificate or the making of any notation hereon, except that if directed by
the Seller in the case of Class B Certificates registered in the name of a
Clearing Agency or Foreign Clearing Agency, as applicable, distributions will be
made in the form of immediately available funds. Except as otherwise provided in
the Agreement and notwithstanding the above, the final distribution on this
Class B Certificate will be made after due notice by the Trustee of the pendency
of such distribution and only upon presentation and surrender of this Class B
Certificate at the office or agency maintained for that purpose by the Transfer
Agent and Certificate Registrar in The City of New York.
Reference is hereby made to the further provisions of this
Class B Certificate set forth on the reverse hereof, which further provisions
shall for all purposes have the same effect as if set forth at this place.
All capitalized terms used herein not otherwise defined shall
have the meaning assigned thereto in the Agreement.
A-2-4
<PAGE>
Unless the authentication hereon shall have been executed by
an authorized officer of the Trustee or an authenticating agent acting on behalf
of the Trustee, by manual signature, this Class B Certificate shall not entitle
the holder hereof to any benefit under the Agreement or be valid for any
purpose.
A-2-5
<PAGE>
IN WITNESS WHEREOF, the Trustee, on behalf of the Trust, and
not in its individual capacity, has caused this Certificate to be duly executed.
CHASE MANHATTAN AUTO
GRANTOR TRUST 199_-_
By: [______________________________]
By: ________________________________
Authorized Officer
This is one of the Certificates referred to
in the within-mentioned Agreement.
[__________________________________]
not in its individual capacity
but solely as Trustee
By: ________________________________
Authorized Officer
or
____________________________________
as Authenticating Agent
for the Trustee
By: ________________________________
Authorized Officer
A-2-6
<PAGE>
CHASE MANHATTAN AUTO GRANTOR TRUST 199_-_
____% AUTOMOBILE LOAN PASS-THROUGH CERTIFICATES, CLASS B
The Agreement permits, with certain exceptions therein
provided, the amendment thereof and the modification of the rights of the
Certificateholders under the Agreement at any time by the Seller, the Servicer
and the Trustee with the consent of the Holders of Certificates evidencing not
less than a majority of the sum of the Class A Certificate Balance and the Class
B Certificate Balance voting as a single class. Any such consent by the Holder
of this Class B Certificate shall be conclusive and binding on such Holder and
on all future Holders of this Class B Certificate and of any Class B Certificate
issued upon registration of transfer hereof or in exchange herefor or in lieu
hereof whether or not notation of such consent is made upon this Class B
Certificate. The Agreement also permits the amendment thereof, in certain
limited circumstances and with certain exceptions provided therein, without
prior notice to or the consent of the Holders of any of the Certificates.
As provided in the Agreement and subject to certain
limitations therein set forth, the transfer of this Class B Certificate is
registerable in the Certificate Register upon surrender of this Class B
Certificate for registration of transfer at the office or agency maintained by
the Transfer Agent and Certificate Registrar, in The City of New York,
accompanied by a written instrument of transfer in form satisfactory to the
Trustee and the Transfer Agent and Certificate Registrar duly executed by the
Holder hereof, which signature to such assignment has been guaranteed by a
member of the New York Stock Exchange or a commercial bank or trust company, and
thereupon one or more new Class B Certificates of authorized denominations
evidencing the same aggregate interest in the Trust will be issued to the
designated transferee.
The Class B Certificates are issuable only as registered Class
B Certificates without coupons in denominations of $1,000 and integral multiples
thereof. As provided in the Agreement and subject to certain limitations therein
set forth, Class B Certificates are
A-2-7
<PAGE>
exchangeable for new Class B Certificates of authorized denominations evidencing
the same aggregate denomination, as requested by the Holder surrendering the
same. No service charge will be made for any such registration of transfer or
exchange, but the Transfer Agent and Certificate Agent may require payment of a
sum sufficient to cover any tax or governmental charges payable in connection
therewith.
In the event that the Holder of this Class B Certificate does
not surrender this Certificate for cancellation within six months after the date
specified in the notice regarding the pendency of the final distribution
described on the face hereof, the Trustee shall give a second notice with
respect thereto. If within one year after such second notice this Class B
Certificate shall not have been surrendered for cancellation, the Trustee may
take appropriate steps to contact the Holder hereof. As provided in the
Agreement, any funds remaining in the Trust after exhaustion of such steps shall
be distributed to a charitable organization, such distribution to occur not
later than three years from the date of the final Distribution Date.
The Trustee, the Paying Agent and the Transfer Agent and
Certificate Registrar may treat the Person in whose name this Class B
Certificate is registered as the owner hereof for all purposes, and none of the
Trustee, the Paying Agent or the Transfer Agent and Certificate Registrar shall
be affected by any notice to the contrary.
The obligations and responsibilities created by the Agreement
and the Trust created thereby with respect to the Certificateholders shall
terminate upon the payment to Certificateholders of all amounts required to be
paid to them pursuant to the Agreement on the Distribution Date next succeeding
the month which is six months after the maturity or liquidation of the last
Receivable and the disposition of all property held as part of the Trust. The
Servicer may, at its option, purchase the corpus of the Trust at a price
specified in the Agreement, and such purchase of the Receivables and other
property of the Trust will effect early retirement of the Certificates; however,
such right of purchase is exercisable only as of the last day of a Collection
Period
A-2-8
<PAGE>
immediately preceding any Distribution Date as of which the Pool Balance is
equal to or less than 5% of the Original Pool Balance.
A-2-9
<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 typewrite name and address, including
postal zip code, of assignee)
________________________________________________________________________________
the within Certificate, and all rights thereunder, hereby
irrevocably constituting and appointing
_______________________________________________________________________ Attorney
to transfer said Certificate on the books of the Transfer Agent and Certificate
Registrar, with full power of substitution in the premises.
Dated:
________________________________________*
Signature Guaranteed:
________________________________________*
* NOTICE: The signature to this assignment must correspond with the name as it
appears upon the face of the within Certificate in every particular, without
alteration, enlargement or any change whatever. Such signature must be
guaranteed by a member of the New York Stock Exchange or a commercial bank or
trust company.
A-2-10
<PAGE>
EXHIBIT B
---------
[FORM OF DEPOSITORY RECEIPT AGREEMENT]
B-1
<PAGE>
EXHIBIT C-1
-----------
Trustee's Certificate
pursuant to Section 10.2
of the Pooling and Servicing
Agreement
[_______________________________________], as trustee (the "Trustee")
and as collateral agent of the Chase Manhattan Auto Grantor Trust 199_-_ created
pursuant to the Pooling and Servicing Agreement (the "Pooling and Servicing
Agreement"), dated as of __________ __, ____, between Chase Manhattan Bank USA,
National Association, as Seller (the "Seller") and Servicer, and the Trustee
does hereby sell, transfer, assign, and otherwise convey to the Seller, without
recourse, representation, or warranty, all of the Trustee's right, title, and
interest in and to all of the Receivables (as defined in the Pooling and
Servicing Agreement) identified in the attached Servicer's Certificate as
"Repurchased Receivables," which are to be repurchased by the Seller pursuant to
Section 3.2 of the Pooling and Servicing Agreement and all security and
documents relating thereto.
IN WITNESS WHEREOF I have hereunto set my hand this ____ day
of ______, 19__.
_______________________________________
Authorized Signatory
C-1
<PAGE>
EXHIBIT C-2
-----------
Trustee's Certificate
pursuant to Section 10.2
of the Pooling and Servicing
Agreement
[_______________________________________], as trustee (the
"Trustee") and as collateral agent of the Chase Manhattan Auto Grantor Trust
199_-_ created pursuant to the Pooling and Servicing Agreement (the "Pooling and
Servicing Agreement"), dated as of __________ __, ____, between Chase Manhattan
Bank USA, National Association, as Seller and Servicer (the "Servicer"), and
the Trustee, does hereby sell, transfer, assign, and otherwise convey to the
Servicer, without recourse, representation, or warranty, all of the Trustee's
right, title, and interest in and to all of the Receivables (as defined in the
Pooling and Servicing Agreement) identified in the attached Servicer's
Certificate as "Repurchased Receivables," which are to be purchased by the
Servicer pursuant to Section 4.7 or 11.2 of the Pooling and Servicing Agreement,
and all security and documents relating thereto.
IN WITNESS WHEREOF I have hereunto set my hand this ____ day
of ______, 19__.
________________________________________
Authorized Signatory
C-2
<PAGE>
EXHIBIT D
---------
[FORM OF SERVICER'S CERTIFICATE]
D-1
<PAGE>
EXHIBIT E
---------
CERTIFICATEHOLDER REPORT
E-1
<PAGE>
FORM OF SALE AND
SERVICING AGREEMENT
(OWNER TRUST)
================================================================================
CHASE MANHATTAN BANK USA, N.A.,
a National Banking Association
as Seller and Servicer
and
CHASE MANHATTAN AUTO OWNER TRUST 199_-_,
as Issuer
==============================================
SALE AND SERVICING AGREEMENT
Dated as of ________ __, 199_
==============================================
================================================================================
<PAGE>
TABLE OF CONTENTS
Page
----
ARTICLE I
DEFINITIONS
SECTION 1.1. Definitions............................................ 1
SECTION 1.2. Usage of Terms......................................... 29
SECTION 1.3. [Simple Interest [and Actuarial]
Method;] [Methods of Allocating
Payments or Receivables;] Allocations.................. 29
SECTION 1.4. Calculations Relating to the
__________ Distribution Date].......................... 30
ARTICLE II
CONVEYANCE OF RECEIVABLES
SECTION 2.1. Conveyance of Receivables.............................. 30
SECTION 2.2. Closing................................................ 31
ARTICLE III
THE RECEIVABLES
SECTION 3.1. Representations and Warranties
of Seller; Conditions Relating to
Receivables............................................ 32
SECTION 3.2. Repurchase Upon Breach or
Failure of a
Condition.............................................. 37
SECTION 3.3. Custody of Receivable Files............................ 38
SECTION 3.4. Duties of Servicer as Custodian........................ 38
SECTION 3.5. Instructions; Authority to Act......................... 39
SECTION 3.6. Custodian's Indemnification............................ 39
SECTION 3.7. Effective Period and
Termination............................................ 40
ARTICLE IV
ADMINISTRATION AND SERVICING OF RECEIVABLES
SECTION 4.1. Duties of Servicer..................................... 40
SECTION 4.2. Collection of Receivable
Payments; Refinancing.................................. 41
SECTION 4.3. Realization Upon Receivables........................... 42
SECTION 4.4. Maintenance of Security
Interests in Financed Vehicles......................... 42
SECTION 4.5. Covenants of Servicer.................................. 43
i
<PAGE>
Page
SECTION 4.6. Purchase of Receivables Upon
Breach................................................. 44
SECTION 4.7. Servicing Fee.......................................... 44
SECTION 4.8. Servicer's Certificate................................. 45
SECTION 4.9. Annual Statement as to
Compliance............................................. 45
SECTION 4.10. Annual Audit Report.................................... 46
SECTION 4.11. Access by Holders to Certain
Documentation and Information Regarding
Receivables............................................ 47
SECTION 4.12. Reports to Holders and the
Rating Agencies........................................ 47
SECTION 4.13. Reports to the Securities and
Exchange Commission.................................... 48
ARTICLE V
ACCOUNTS; DISTRIBUTIONS;
STATEMENTS TO CERTIFICATEHOLDERS
SECTION 5.1. Establishment of Accounts.............................. 48
SECTION 5.2. Collections............................................ 49
SECTION 5.3. [Reserved]............................................. 51
SECTION 5.4. Additional Deposits.................................... 51
SECTION 5.5. Distributions.......................................... 51
SECTION 5.6. Reserve Account........................................ 53
SECTION 5.7. Net Deposits........................................... 56
SECTION 5.8. Statements to
[Certificateholders and] Noteholders................... 56
ARTICLE VI
THE SELLER
SECTION 6.1. Representations of Seller.............................. 57
SECTION 6.2. Liability of Seller;
Indemnities............................................ 59
SECTION 6.3. Merger or Consolidation of
Seller................................................. 60
SECTION 6.4. Limitation on Liability of
Seller and Others...................................... 60
SECTION 6.5. Seller May Own Notes [and
Certificates].......................................... 60
ARTICLE VII
THE SERVICER
SECTION 7.1. Representations of Servicer............................ 61
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Page
SECTION 7.2. Liability of Servicer;
Indemnities............................................ 63
SECTION 7.3. Merger or Consolidation of
Servicer............................................... 64
SECTION 7.4. Limitation on Liability of
Servicer and Others.................................... 64
SECTION 7.5. Servicer Not To Resign................................. 65
SECTION 7.6. Delegation of Duties................................... 66
ARTICLE VIII
EVENTS OF SERVICING TERMINATION
SECTION 8.1. Events of Servicing Termination........................ 66
SECTION 8.2. Indenture Trustee to Act;
Appointment of Successor............................... 68
SECTION 8.3. Notification to Noteholders [and
Certificateholders].................................... 69
SECTION 8.4. Waiver of Past Defaults................................ 69
ARTICLE IX
TERMINATION
SECTION 9.1. Optional Purchase of All
Receivables; Trust Termination......................... 70
ARTICLE X
MISCELLANEOUS PROVISIONS
SECTION 10.1. Amendment.............................................. 72
SECTION 10.2. Protection of Title to Owner
Trust Estate........................................... 73
SECTION 10.3. GOVERNING LAW.......................................... 76
SECTION 10.4. Notices................................................ 76
SECTION 10.5. Severability of Provisions............................. 76
SECTION 10.6. Assignment............................................. 77
SECTION 10.7. Certificates and Notes
Nonassessable and Fully Paid........................... 77
SECTION 10.8. Third-Party Beneficiaries.............................. 77
SECTION 10.9. Assignment to Indenture Trustee........................ 77
SECTION 10.10. Limitation of Liability of Owner
Trustee and Indenture Trustee.......................... 77
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SCHEDULES
Schedule A - List of Receivables
Schedule B - Location of Receivable Files
EXHIBITS
Exhibit A - Form of Servicer's Certificate
Exhibit B - Form of Monthly Report
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This Sale and Servicing Agreement, dated as of ________ __,
199_ (as amended, supplemented or otherwise modified and in effect from time to
time, this "Agreement") is made between CHASE MANHATTAN BANK USA, National
Association, a national banking association having its principal executive
offices located at 802 Delaware Avenue, Wilmington, Delaware 19801 ("Chase USA,"
the "Seller" or the "Servicer" in its respective capacities as such), and CHASE
MANHATTAN AUTO OWNER TRUST 199_-_, as issuer (the "Issuer").
W I T N E S S E T H :
In consideration of the premises and of the mutual agreements
herein contained, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS
SECTION 1.1. Definitions. Whenever used in this Agreement, the
following words and phrases, unless the context otherwise requires, shall have
the following meanings:
"Accrued Interest" on a Receivable, as of any date of
determination, means that amount of interest accrued on the Principal Balance at
the related Contract Rate but not paid by or on behalf of the Obligor.
"Accounts" means, collectively, the Collection Account[, the
Paid-Ahead Account] and the Note Distribution Account.
"Actuarial Receivable" means any monthly actuarial Receivable.
"Administration Agreement" means the Administration Agreement
dated as of ________ __, 199_, among the Issuer, the Administrator and the
Indenture Trustee, as the same may be amended and supplemented from time to
time.
"Administrator" means The Chase Manhattan Bank, a New York
banking corporation, as administrator, and its successors and assigns.
"Administration Fee" means $_____, the fee payable to the
Administrator on each Distribution Date pursuant to Section 5.5(c) for services
rendered pursuant to the Administration Agreement.
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"Affiliate" means, with respect to any specified Person, any
other Person controlling or controlled by or under common control with such
specified Person. For purposes of this definition, "control" when used with
respect to any specified Person means the power to direct the management and
policies of such Person, directly or indirectly, whether through the ownership
of voting securities, by contract or otherwise; and the terms "controlling" and
"controlled" have meanings correlative to the foregoing. A Person shall not be
deemed to be an Affiliate of any specified Person solely because such other
Person has the contractual right or obligation to manage such specified Person
unless such other Person controls such specified Person through equity ownership
or otherwise.
"Aggregate Net Losses" means, for any Distribution Date, the
amount equal to (i) the aggregate principal balance of the Receivables that
became Defaulted Receivables during the related Collection Period minus (ii) the
Liquidation Proceeds allocable to principal collected during such Collection
Period with respect to any Defaulted Receivables.
"Amount Financed" in respect of a Receivable means the amount
advanced under the Receivable toward the purchase price of the Financed Vehicle
and related costs.
"Applied Paid-Ahead Amount" means, with respect to any
Actuarial Receivable and any Collection Period for which the amount actually
paid is less than the Scheduled Payment due during such Collection Period, the
Deferred Paid-Ahead Amount with respect to such Actuarial Receivable to the
extent of such shortfall; provided that if such Actuarial Receivable becomes a
Defaulted Receivable during such Collection Period, the Applied Paid-Ahead
Amount with respect to such Collection Period shall equal such Receivable's then
outstanding Deferred Paid-Ahead Amount, if any.
"Assertion" has the meaning specified in Section 4.10.
"Authenticating Agent" has the meaning specified in Section
2.13 of the Indenture and shall initially be the corporate trust office of
Chase, and its successors and assigns in such capacity.
["Authorized Newspaper" means a leading daily newspaper in the
English language of general circulation in Luxembourg. On the Closing Date, the
Luxemburger Wort shall constitute an "Authorized Newspaper." If, because of
temporary or permanent suspension of publication or general circulation of any
newspaper or for any other reason, it is impossible or, in the opinion of the
Indenture Trustee, impracticable to make any publication of any notice required
hereby in an Authorized Newspaper, any
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publication or other notice in lieu thereof which is made or given in Luxembourg
with the approval of the Indenture Trustee shall constitute a sufficient
publication of such notice.]
"Authorized Officer" means any officer of the Owner Trustee,
Indenture Trustee or Servicer who is authorized to act on behalf of the Owner
Trustee, Indenture Trustee or Servicer, as applicable, and who is identified as
such on the list of authorized officers delivered by each such party on the
Closing Date.
"Available Interest" means, for any Distribution Date, that
portion of Collections on the Receivables received during the related Collection
Period allocated to interest and, to the extent attributable to interest, the
Repurchase Amount received with respect to each Receivable repurchased by the
Seller or purchased by the Servicer under an obligation that arose during the
related Collection Period.
"Available Principal" means, for any Distribution Date, that
portion of Collections on the Receivables received during the related Collection
Period allocated to the principal balance of the Receivables, and, to the extent
attributable to principal, the Repurchase Amount received with respect to each
Receivable repurchased by the Seller or purchased by the Servicer under an
obligation that arose during the related Collection Period.
"Available Reserve Account Amount" shall mean, for each
Distribution Date, an amount equal to the lesser of (i) the amount on deposit in
the Reserve Account and (ii) the Specified Reserve Account Balance with respect
to such Distribution Date.
"Average Delinquency Percentage" means for any Distribution
Date, the average of the Delinquency Percentages for such Distribution Date and
the preceding two (2) Distribution Dates.
"Average Net Loss Ratio" means for any Distribution Date, the
average of the Net Loss Ratios for such Distribution Date and the preceding two
(2) Distribution Dates.
"Basic Documents" means this Agreement, the Certificate of
Trust, the Indenture, the Depository Agreements, the Trust Agreement, the
Administration Agreement and other documents and certificates delivered in
connection therewith.
"Benefit Plan" has the meaning specified in Section
11.12 of the Trust Agreement.
["Book-Entry Certificates" means beneficial interests
in the Certificates, the ownership and transfers of which shall
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be made through book entries by a Clearing Agency or Foreign Clearing Agency as
described in Section 3.10 of the Trust Agreement.]
"Book-Entry Notes" means beneficial interests in the Notes,
the ownership and transfers of which shall be made through book entries by a
Clearing Agency or Foreign Clearing Agency as described in Section 2.10 of the
Indenture.
"Business Day" means a day, other than a Saturday or a Sunday,
on which the Indenture Trustee and banks located in New York, New York,
Wilmington, Delaware and __________, ____________ are open for the purpose of
conducting a commercial banking business.
"Business Trust Statute" means Chapter 38 of Title 12 of the
Delaware Code, 12 Del. Code ss. 3801 et seq., as amended from time to time.
"Capital Accounts" has the meaning specified in Section 5.7 of
the Trust Agreement.
"Cedel" means Cedel Bank, societe anonyme.
"Certificate" means a certificate evidencing the beneficial
interest of a Certificateholder in the Owner Trust Estate, substantially in the
form of Exhibit A to the Trust Agreement.
"Certificate Balance" means an amount equal to $ as of the
Closing Date and, thereafter, such initial Certificate Balance, reduced by all
amounts allocable to principal previously distributed to Certificateholders. The
Certificate Balance shall also be reduced on any Distribution Date by the
excess, if any, of (i) the sum of (A) the Certificate Balance and (B) the
outstanding principal amount of the Notes (in each case after giving effect to
amounts in respect of principal to be deposited in the Certificate Distribution
Account and the Note Distribution Account on such Distribution Date), over (ii)
the Pool Balance as of the close of business on the last day of the preceding
Collection Period. Thereafter, the Certificate Balance shall be increased on any
Distribution Date to the extent that any portion of the Total Distribution
Amount on any Distribution Date is available to pay the existing
Certificateholders' Principal Carryover Shortfall, but not by more than the
aggregate reductions in the Certificate Balance set forth in the preceding
sentence.
["Certificate Depository Agreement" means the agreement among
the Issuer, the Owner Trustee, Chase, as agent for the
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Depository Trust Company and The Depository Trust Company, as the initial
Clearing Agency, dated the Closing Date, relating to the Certificates,
substantially in the form attached as Exhibit C to the Trust Agreement, as the
same may be amended and supplemented from time to time.]
"Certificate Distribution Account" has the meaning specified
in Section 5.1 of the Trust Agreement.
"Certificate Final Scheduled Distribution Date" means the
______________ Distribution Date on which the outstanding principal amount, if
any, of the Certificates is payable.
"Certificate of Trust" means the Certificate of Trust in the
form of Exhibit B to the Trust Agreement to be filed for the Issuer pursuant to
Section 3810(a) of the Business Trust Statute.
"Certificate Owner" means, with respect to a Book-Entry
Certificate, the Person who is the owner of such Book-Entry Certificate, as
reflected on the books of the Clearing Agency or Foreign Clearing Agency or on
the books of a direct or indirect Clearing Agency Participant.
"Certificate Pool Factor" as of the close of business on a
Distribution Date means a eight-digit decimal figure equal to the Certificate
Balance (after giving effect to distributions made on such date) divided by the
initial Certificate Balance. The Certificate Pool Factor will be 1.00000000 as
of the Cutoff Date; thereafter, the Certificate Pool Factor will decline to
reflect reductions in the Certificate Balance.
"Certificate Rate" means _____% per annum.
["Certificate Register" and "Certificate Registrar" means the
register maintained and the registrar appointed pursuant to Section 3.4 of the
Trust Agreement.]
"Certificateholder" means the Person in whose name a
Certificate is registered in the Certificate Register, except that, solely for
the purpose of giving any consent, request, waiver or demand pursuant to any of
the Basic Documents (other than pursuant to Section 4.3 of the Trust Agreement),
the interest evidenced by any Certificate registered in the name of the Seller,
the Servicer or any Person actually known by an Authorized Officer of the Owner
Trustee to be an Affiliate of the Seller or the Servicer shall not be taken into
account in determining whether the requisite percentage necessary to effect any
such consent, request or waiver shall have been obtained.
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"Certificateholders' Distributable Amount" means for any
Distribution Date, the sum of the Certificateholders' Principal Distributable
Amount and the Certificateholders' Interest Distributable Amount.
"Certificateholders' Interest Carryover Shortfall" means, (a)
for the initial Distribution Date, zero, and (b) for any other Distribution
Date, the excess of the Certificateholders' Interest Distributable Amount for
the preceding Distribution Date, over the amount in respect of the interest
actually deposited in the Certificate Distribution Account on such preceding
Distribution Date, plus interest on such excess, to the extent permitted by law,
at the Certificate Rate from and including such preceding Distribution Date to,
but excluding, the current Distribution Date.
"Certificateholders' Interest Distributable Amount" means, for
any Distribution Date, the sum of the Certificateholders' Monthly Interest
Distributable Amount for such Distribution Date and the Certificateholders'
Interest Carryover Shortfall for such Distribution Date.
"Certificateholders' Monthly Interest Distributable Amount"
means, for any Distribution Date, one month's interest (or, in the case of the
first Distribution Date, interest accrued from and including the Closing Date
to, but excluding, such Distribution Date) at the Certificate Rate on the
Certificate Balance on the immediately preceding Distribution Date, after giving
effect to all principal payments on such Distribution Date (or, in the case of
the first Distribution Date, the Certificate Balance on the Closing Date).
Interest shall be computed on the basis of a 360 day-year of twelve 30-day
months for purposes of this definition.
"Certificateholders' Monthly Principal Distributable Amount"
means, for any Distribution Date prior to the Distribution Date on which the
Notes have been paid in full, zero; and for any Distribution Date commencing on
or after the Distribution Date on which the Notes have been paid in full, 100%
of the Principal Distribution Amount (less the portion of the Principal
Distribution Amount required on the first such Distribution Date to pay the
Notes in full).
"Certificateholders' Principal Carryover Shortfall" means for
any Distribution Date, the sum of (a) the excess of (i) the Certificateholders'
Principal Distributable Amount for the preceding Distribution Date, over (ii)
the amount in respect of principal that was actually deposited in the
Certificate Distribution Account on such Distribution Date and (b) without
duplication of clause (a), the unreimbursed portion of the amount
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by which the Certificate Balance has been reduced pursuant to the second
sentence of the definition thereof.
"Certificateholders' Principal Distributable Amount" means,
for any Distribution Date, the sum of (i) the Certificateholders' Monthly
Principal Distributable Amount for such Distribution Date and (ii) the
Certificateholders' Principal Carryover Shortfall for such Distribution Date;
provided that the Certificateholders' Principal Distributable Amount shall not
exceed the Certificate Balance. In addition, on the Certificate Final Scheduled
Distribution Date, the principal required to be distributed to the
Certificateholders will include the lesser of (a) any payments of principal due
and remaining unpaid on each Receivable owned by the Issuer as of the last day
of the immediately preceding Collection Period and (b) the amount that is
necessary (after giving effect to the other amounts to be deposited in the
Certificate Distribution Account on such Distribution Date and allocable to
principal) to reduce the Certificate Balance to zero, in either case after
giving effect to any required distribution of the Noteholders' Principal
Distributable Amount to the Note Distribution Account.
"Chase" means The Chase Manhattan Bank, a New York banking
corporation.
"Chase Direct Receivable" means a Receivable originated by
Chase directly with an Obligor without the involvement of a Dealer.
["Class A Notes" means, collectively the Class A-1 Notes, the
Class A-2 Notes, the Class A-3 Notes[,] [and] the Class A-4 Notes [and the Class
A-5 Notes].]
["Class A Noteholder" means the Person in whose name a
Class A Note is registered on the Note Register.]
["Class A Noteholders' Interest Carryover Shortfall" means,
for any Distribution Date, the excess of (i) the Class A Noteholders' Interest
Distributable Amount for the preceding Distribution Date, over (ii) the amount
in respect of interest on the Class A Notes actually deposited in the Note
Distribution Account on such preceding Distribution Date, plus interest on the
amount of interest due but not paid to the Class A Noteholders of each class on
the preceding Distribution Date, to the extent permitted by law, at the
respective Interest Rates borne by each class of the Class A Notes for the
related Interest Accrual Period.]
["Class A Noteholders' Interest Distributable Amount" means,
for any Distribution Date, the sum of the Class A Noteholders' Monthly
Interest Distributable Amount for all
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classes of Class A Notes for such Distribution Date and (y) the Class A
Noteholders' Interest Carryover Shortfall for such Distribution Date.]
["Class A Noteholders' Monthly Interest Distributable Amount"
means, for any Distribution Date, in the case of each class of Class A Notes,
interest accrued during the related Interest Accrual Period at the related
Interest Rate on the outstanding principal balance of the Class A Notes of such
class on such Distribution Date (or, in the case of the first Distribution Date,
on the Closing Date).]
"Class A-1 Event" shall have occurred if any Class A-1 Notes
are outstanding on the __________ Distribution Date (after giving effect to any
payments made on such date).
"Class A-1 Interest Rate" means _____% per annum.
"Class A-1 Notes" means the Class A-1 _____% Asset Backed
Notes, substantially in the form of Exhibit B to the Indenture.
"Class A-2 Interest Rate" means _____% per annum.
"Class A-2 Notes" means the Class A-2 _____% Asset Backed
Notes, substantially in the form of Exhibit C to the Indenture.
"Class A-3 Interest Rate" means _____% per annum.
"Class A-3 Notes" means the Class A-3 _____% Asset Backed
Notes, substantially in the form of Exhibit D to the Indenture.
"Class A-4 Interest Rate" means _____% per annum.
"Class A-4 Notes" means the Class A-4 _____% Asset Backed
Notes, substantially in the form of Exhibit E to the Indenture.
["Class A-5 Interest Rate" means _____% per annum.]
["Class A-5 Notes" means the Class A-5 ____% Asset Backed
Notes, substantially in the form of Exhibit F to the Indenture.]
["Class B Interest Rate" means _____% per annum.]
["Class B Noteholders' Interest Carryover Shortfall" means,
for any Distribution Date, the excess of (i) the Class B Noteholders' Interest
Distributable Amount for the preceding
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Distribution Date, over (ii) the amount in respect of interest for the Class B
Notes actually deposited in the Note Distribution Account on such preceding
Distribution Date, plus interest on the amount of interest due but not paid to
the Class B Noteholders on the preceding Distribution Date, to the extent
permitted by law, at the Class B Interest Rate for the related Interest Accrual
Period.]
["Class B Noteholders' Interest Distributable Amount" means,
for any Distribution Date, the sum of (x) the Class B Noteholders' Monthly
Interest Distributable Amount for such Distribution Date and (y) the Class B
Noteholders' Interest Carryover Shortfall for such Distribution Date.]
["Class B Noteholders' Monthly Interest Distributable Amount"
means, for any Distribution Date, interest accrued during the related Interest
Accrual Period at the Class B Interest Rate on the outstanding principal balance
of the Class B Notes on such Distribution Date (or, in the case of the first
Distribution Date, on the Closing Date).]
["Class B Notes" means the Class B _____% Asset Backed Notes,
substantially in the form of Exhibit F to the Indenture.]
"Clearing Agency" means an organization registered as a
"clearing agency" pursuant to Section 17A of the Exchange Act. The initial
Clearing Agency shall be The Depository Trust Company.
"Clearing Agency Participant" means a broker, dealer, bank,
other financial institution or other person for whom from time to time a
Clearing Agency effects book-entry transfers of securities deposited with the
Clearing Agency (including a Foreign Clearing Agency).
"Closing Date" means _____ __, ____.
"Code" means the Internal Revenue Code of 1986, as amended.
"Collection Account" has the meaning specified in
Section 5.1(a)(i).
"Collection Period" means each calendar month beginning _____
__, ____ until Chase Manhattan Auto Owner Trust 199_-_ shall terminate pursuant
to Article IX of the Trust Agreement.
"Collections" means all collections in respect of Receivables.
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"Contract Rate" of a Receivable means the annual rate of
interest stated in such Receivable.
"Controlling Notes" means (i) initially, all classes of Class
A Notes voting as a single class until the Class A Notes have been paid in full
and (ii) after the Class A Notes have been paid in full, the Class B Notes.
"Corporate Trust Office" shall mean the New York office of the
Indenture Trustee or the ___________, ____________ office of the Owner Trustee,
as applicable.
"Cutoff Date" means ________ __, ____.
"Dealer" means the dealer which sold a Financed Vehicle
related to a Dealer Receivable and which originated or assisted in the
origination of such Dealer Receivable under a Dealer Agreement.
"Dealer Agreement" means any agreement and, if applicable,
assignment under which Dealer Receivables were originated by or through a Dealer
and sold to the Seller or an affiliate of the Seller.
"Dealer Receivable" means each Receivable which is not
a Direct Receivable.
"Default" means any occurrence that is, or with notice or the
lapse of time or both would become, an Event of Default.
"Defaulted Receivable" means a Receivable (other than a
Repurchased Receivable) as to which the Servicer has determined based on its
usual collection practices and procedures, during any Collection Period, that
eventual payment in full of the Amount Financed (including accrued interest
thereon) is unlikely; provided that a Receivable shall become a Defaulted
Receivable during the calendar month in which more than 10% of the scheduled
payment becomes 240 days delinquent, regardless of whether any such
determination has been made.
"Deferred Paid-Ahead Amount" means, with respect to any
Collection Period and any Precomputed Receivable, the amount, if any, held by
the Servicer pursuant to Section 5.2(b) or in the Paid-Ahead Account with
respect to such Receivable.
["Definitive Notes" means Notes issued in certificated,
fully registered form as provided in Section 2.12 of the
Indenture.]
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"Definitive Certificates" means Certificates issued in
certificated, fully registered form as provided in Section 3.12 of the Trust
Agreement.
"Delaware Trustee" has the meaning specified in
Section 10.1 of the Trust Agreement.
"Delinquency Percentage" means, for any Distribution Date, the
sum of the outstanding principal balances of all Receivables which were 60 days
or more delinquent (including Receivables, which are not Defaulted Receivables,
relating to Financed Vehicles that have been repossessed), as of the close of
business on the last day of the Collection Period immediately preceding such
Distribution Date, determined in accordance with the Servicer's normal
practices, such sum expressed as a percentage of the Pool Balance as of the
close of business on the last day of such Collection Period.
"Delivery" when used with respect to Reserve Account
Property means:
(a)(i) with respect to "certificated securities"
within the meaning of Section 8-102(1)(a) of the Relevant UCC not held
by the initial Clearing Agency or other "instruments" within the
meaning of Section 9-105(1)(i) of the Relevant UCC, (A) physical
delivery thereof 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, or, (B) with respect to a
certificated security, possession thereof by a financial intermediary
(as defined in Section 8-313(4) of the Relevant UCC) and the making by
such financial intermediary of entries on its books and records
identifying such certificated securities as belonging to the Indenture
Trustee or its nominee or custodian and the sending by such financial
intermediary of a confirmation of the purchase of such certificated
security by the Indenture Trustee or its nominee or custodian, or (ii)
with respect to "certificated securities" within the meaning of Section
8-102(4)(a) of the Relevant UCC held by the initial Clearing Agency or
by a "custodian bank" within the meaning of Section 8-102(4) of the
Relevant UCC (a "Custodian Bank") or a nominee of either subject to the
control of the initial Clearing Agency, the delivery thereof to the
initial Clearing Agency or a Custodian Bank or a nominee of either
subject to the control of the initial Clearing Agency and in bearer
form or endorsed in blank by an appropriate person or registered on the
books of the issuer thereof in the name of the initial Clearing Agency
or its Custodian Bank or a nominee of either and the identification by
book-entry or otherwise on the records of the financial intermediary,
the sending of a
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confirmation by the financial intermediary of the purchase by the
Indenture Trustee or its nominee or custodian of such securities and
the making by such financial intermediary of entries on its books and
records identifying such certificated securities as belonging to the
Indenture Trustee or its nominee or custodian (all of the foregoing,
"Physical Property"), and such additional or alternative procedures as
may hereafter become appropriate to effect the complete transfer of
ownership of any such Reserve Account Property 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 United States Securities
Entitlements that are maintained in the form of entries on the records
of the Federal Reserve System pursuant to Federal book-entry
regulations, the following procedures: entries on the records of a
member bank of the Federal Reserve System identifying such Reserve
Account Property as belonging to a Federal Reserve "depositary"
pursuant to applicable Federal regulations and the sending by such
depositary of written confirmation of the purchase of such Reserve
Account Property to the Indenture Trustee or its nominee or custodian;
the making by such depositary of entries in its books and records
identifying such Reserve Account Property as belonging to, or otherwise
subject to a security interest in favor of, the Indenture Trustee or
its nominee or custodian; and such additional or alternative procedures
as may hereafter become appropriate to effect transfer of ownership of
any such Reserve 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 Reserve Account
Property that is an uncertificated security under Article 8 (or VIII,
as applicable) of the Relevant UCC and that is not governed by clause
(b) above, registration on the books and records of the issuer thereof
in the name of the financial intermediary, the sending of a
confirmation by the financial intermediary of the purchase by the
Indenture Trustee or its nominee or custodian of such uncertificated
security, the making by such financial intermediary of entries on its
books and records identifying such uncertificated certificates as
belonging to the Indenture Trustee or its nominee or custodian; and
such additional or alternative procedures as may hereafter become
appropriate to effect transfer of ownership of any such Reserve Account
Property to the Indenture Trustee or its nominee or custodian
consistent with changes in applicable law or regulations or the
interpretation thereof.
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"Deposit Date" means the Business Day immediately
preceding each Distribution Date.
"Depositor" means the Seller in its capacity as
Depositor under the Trust Agreement.
"Depository Agreements" mean[, collectively, the
Certificate Depository Agreement and] the Note Depository
Agreement.
"Determination Date" means the 10th calendar day of the month
(or, if such 10th calendar day is not a Business Day, the Business Day preceding
the 10th calendar day of the month) immediately succeeding the related
Collection Period.
"Direct Receivable" means either a Chase Direct Receivable or
a Receivable originated by the Seller or an Affiliate of the Seller directly
with an Obligor without the involvement of a Dealer.
"Distribution Date" means, in the case of the first Collection
Period, _____ __, 199_, and in the case of every Collection Period thereafter,
the 15th day of the following month, or if the 15th day is not a Business Day,
the next following Business Day[; provided, however, that solely for purposes of
determining the Note Final Scheduled Distribution Date for the Class A-1 Notes,
making payments on the Notes pursuant to Section 5.5, the Indenture and the
Notes and making withdrawals from the Reserve Account, if the Class A-1 Event
shall have occurred, the Distribution Date in the case of the __________
Collection Period means (x) _____ __, 199_ with respect to the Class A-1 Notes,
and (y) _____ __, 199_ with respect to the Class A-2 Notes, the Class A-3
Notes[,] [and] the Class A-4 Notes, the Class [A-5][B] Notes [and the
Certificates].
"Eligible Deposit Account" means (a) a segregated identifiable
trust account established in the trust department of a Qualified Trust
Institution, which shall, except in the case of the Reserve Account, initially
be Chase, and may be maintained with Chase so long as Chase is a Qualified Trust
Institution; or (b) a separately identifiable deposit account established in the
deposit taking department of a Qualified Institution, which, except in the case
of the Reserve Account, may be Chase so long as Chase is a Qualified
Institution.
"ERISA" has the meaning specified in Section 11.12 of
the Trust Agreement.
"Executive Officer" means, with respect to any corporation or
bank, the Chief Executive Officer, Chief Operating Officer, Chief Financial
Officer, President, Executive Vice
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President, any Vice President, the Secretary or the Treasurer of such
corporation or bank, and with respect to any partnership, any general partner
thereof.
"Euroclear Operator" means Morgan Guaranty Trust Company of
New York, Brussels, Belgium office, in its capacity as the operator of the
Euroclear system.
"Event of Default" means an event specified in Section
5.1 of the Indenture.
"Event of Servicing Termination" means an event
specified in Section 8.1.
"Exchange Act" means the Securities Exchange Act of
1934, as amended.
"Expenses" has the meaning specified in Section 8.2 of
the Trust Agreement.
"Farm Credit Entitlement" means a "Security
Entitlement" as defined in 12 C.F.R. ss. 615.5450.
"FDIC" means the Federal Deposit Insurance Corporation
or any successor thereto.
"FHL Bank Entitlement": means a "Security Entitlement"
as defined in 12 C.F.R. ss. 912.1.
"FHLMC" means the Federal Home Loan Mortgage
Corporation or any successor thereto.
"Final Scheduled Maturity Date" means the last day of the
Collection Period immediately preceding the [Certificate] [Class B] Final
Scheduled Distribution Date.
"Financed Vehicle" means, with respect to a Receivable, the
new or used automobile or light-duty truck, together with all accessions
thereto, securing an Obligor's indebtedness under such Receivable.
"Fitch" means Fitch Investors Service L.P. and its
successors and assigns.
"FNMA" means the Federal National Mortgage Association
or any successor thereto.
"Foreign Clearing Agency" means, collectively, Cedel
and the Euroclear Operator.
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"Funding Corporation Entitlement" means a "Security
Entitlement" as defined in 12 C.F.R. ss. 1511.1.
"Grant" means mortgage, pledge, bargain, sell, warrant,
alienate, remise, release, convey, assign, transfer, create, and grant a lien
upon and a security interest in and right of set-off against, deposit, set over
and confirm pursuant to the Indenture. A Grant of the Trust Estate 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 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 "Holders" means, unless the context otherwise
requires, both Certificateholders and Noteholders.
"HUD Entitlement" means a "Security Entitlement" as
defined in 24 C.F.R. ss. 81.2.
"Indemnified Parties" has the meaning specified in
Section 8.2 of the Trust Agreement.
"Indenture" means the Indenture dated as of ________ __, ____,
between the Issuer and the Indenture Trustee, as the same may be amended and
supplemented from time to time.
"Indenture Trustee" means, initially, [_______________
____________________], as Indenture Trustee under the Indenture, or any
successor Indenture Trustee under the 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 upon the Notes, the Seller and any 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
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applicable requirements of Section 11.1 of the Indenture, made by an Independent
engineer, appraiser or other expert appointed by the Issuer 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 Agreement and that the signer is Independent within the meaning thereof.
"Insolvency Event" means, for 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
(including any receiver appointed under the Financial Institutions Reform,
Recovery and Enforcement Act of 1989, as amended), 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 of 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 Rate" means the rate of interest borne by the
Notes of any class.
"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 [and the Paid-Ahead Account].
"Issuer" means Chase Manhattan Auto Owner Trust 199_-_, a
Delaware business trust, until a successor replaces it and, thereafter, means
such successor and, for purposes of any provision contained in the Indenture and
required by the TIA, each other obligor on the Notes.
"Issuer Order" and "Issuer Request" means a written order or
request signed in the name of the Issuer by any of its authorized officers and
delivered to the Indenture Trustee.
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"Late Fees" means any late charges, credit related extension
fees, non-credit related extension fees or other administrative fees or similar
charges allowed by applicable law with respect to the Receivables.
"Lien" means a security interest, lien, charge, pledge or
encumbrance of any kind other than tax liens, mechanics' liens or any other
liens that attach by operation of law.
"Liquidation Proceeds" means, with respect to any Receivable,
(i) insurance proceeds, (ii) the monies collected during a Collection Period
from whatever source on a Defaulted Receivable and (iii) proceeds of a Financed
Vehicle sold after repossession, in each case net of any liquidation expenses
and payments required by law to be remitted to the Obligor.
"Moody's" means Moody's Investors Service, a division of Dun &
Bradstreet Corporation, and its successors and assigns.
"Net Loss Ratio" means, for any Distribution Date, an amount,
expressed as a percentage, equal to (i) the Aggregate Net Losses for such
Distribution Date divided by (ii) the average of the Pool Balances on each of
the related Settlement Dates and the last day of the related Collection Period.
"Note" means a Class A-1 Note, a Class A-2 Note, a Class A-3
Note[,] a Class A-4 Note or a Class [A-5][B] Note.
"Note Depository Agreement" means the agreement among the
Issuer, the Indenture Trustee, Chase, as agent for The Depository Trust Company
and The Depository Trust Company, as the initial Clearing Agency, dated the
Closing Date, relating to the Notes, substantially in the form of Exhibit G to
the Indenture, as the same may be amended or supplemented from time to time or
any similar agreement with any successor Clearing Agency.
"Note Distribution Account" means the account designated as
such, established and maintained pursuant to Section 5.1(a)(ii).
"Note Final Scheduled Distribution Date" means for (a) the
Class A-1 Notes, the __________ Distribution Date, (b) the Class A-2 Notes, the
__________ Distribution Date, (c) the Class A-3 Notes, the _____________
Distribution Date, (d) the Class A-4 Notes, the _________ Distribution Date and
(e) the Class [A-5] [B] Notes, the _____________ Distribution Date.
"Note Owner" means, with respect to a Book-Entry Note, the
person who is the owner of such Book-Entry Note, as reflected on the books of
the Clearing Agency or Foreign Clearing Agency,
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or on the books of a direct or indirect Clearing Agency Participant.
"Note Pool Factor" for each class of Notes as of the close of
business on a Distribution Date means an eight-digit decimal figure equal to the
Outstanding Amount of such class of Notes divided by the Outstanding Amount as
of the Closing Date of such class of Notes. The Note Pool Factor for each class
of Notes will be 1.00000000 as of the Cutoff Date; thereafter, the Note Pool
Factor for each class of Notes will decline to reflect reductions in the
Outstanding Amount of such class of Notes.
"Noteholder" means the Person in whose name a Note is
registered on the Note Register.
"Noteholders' Distributable Amount" means, for any
Distribution Date, the sum of the Noteholders' Principal Distributable Amount
and the Noteholders' Interest Distributable Amount for all classes of Notes.
"Noteholders' Interest Carryover Shortfall" means, for any
Distribution Date for any class of Notes (other than the initial Distribution
Date), the excess of (x) the Noteholders' Interest Distributable Amount for the
preceding Distribution Date for such class of Notes, over (y) the amount in
respect of interest actually deposited in the Note Distribution Account on such
preceding Distribution Date with respect to such class of Notes, plus interest
on the amount of interest due but not paid to the Noteholders of such class on
the preceding Distribution Date, to the extent permitted by law, at the
applicable Interest Rate from such preceding Distribution Date through the
current Distribution Date.
"Noteholders' Interest Distributable Amount" means, for any
Distribution Date for any class of Notes, the sum of (x) the Noteholders'
Monthly Interest Distributable Amount for such class of Notes for such
Distribution Date and (y) the Noteholders' Interest Carryover Shortfall for such
Distribution Date for such class of Notes.
"Noteholders' Monthly Interest Distributable Amount" means,
for any Distribution Date for each class of Notes, one month's interest (or, in
the case of the first Distribution Date, interest accrued from and including the
Closing Date to but excluding such Distribution Date) at the related Interest
Rate on the Outstanding Amount of the Notes of such class on such Distribution
Date (or, in the case of the first Distribution Date, on the Closing Date).
Interest for purposes of this definition (i) on the Class A-1 Notes shall be
computed on the basis of a 360-day year for the actual number of days elapsed
[(which will be __ days for the __________ Distribution Date for
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the Class A-1 Notes)] and (ii) on the Class A-2 Notes, the Class A-3 Notes, the
Class A-4 Notes and the Class [A-5][B] Notes shall be computed on the basis of a
360-day year of twelve 30-day months.
"Noteholders' Monthly Principal Distributable Amount" means,
for any Distribution Date prior to the Distribution Date on which the Notes have
been paid in full, 100% of the Principal Distribution Amount; and for the
Distribution Date on which the Notes are paid in full, the portion of the
Principal Distribution Amount required to pay the Notes in full.
"Noteholders' Principal Carryover Shortfall" means for any
Distribution Date, the excess of (x) the Noteholders' Principal Distributable
Amount for the preceding Distribution Date over (y) the amount in respect of
principal that was actually deposited in the Note Distribution Account on such
Distribution Date.
"Noteholders' Principal Distributable Amount" means, for any
Distribution Date, the sum of (i) the Noteholders' Monthly Principal
Distributable Amount for such Distribution Date and (ii) the Noteholders'
Principal Carryover Shortfall for such Distribution Date; provided that the
Noteholders' Principal Distributable Amount shall not exceed the Outstanding
Amount of the Notes. In addition, on the Note Final Scheduled Distribution Date
of each class of Notes, the principal required to be deposited in the Note
Distribution Account will include the amount necessary (after giving effect to
the other amounts to be deposited in the Note Distribution Account on such
Distribution Date and allocable to principal) to reduce the Outstanding Amount
of such class of Notes to zero.
"Note Register" and "Note Registrar" have the meanings
specified in Section 2.4 of the Indenture.
"Obligor" on a Receivable means the purchaser or the
co-purchasers of the Financed Vehicle purchased in part or in whole by the
execution and delivery of such Receivable or any other Person who owes or may be
liable for payments under such Receivable.
"Officer's Certificate" means a certificate signed by the
chairman of the board, the president, the treasurer, the controller, any
executive or senior vice president or any vice president of the Seller or
Servicer, as appropriate, meeting the requirements of Section 11.1 of the
Indenture.
"Opinion of Counsel" means a written opinion of counsel (who
may be counsel to the Seller or the Servicer) reasonably acceptable in form and
substance to the Indenture Trustee,
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meeting the requirements of Section 11.1 of the Indenture (or in the case of an
Opinion of Counsel delivered to the Owner Trustee, reasonably acceptable in form
and substance to the Owner Trustee).
"Optional Purchase Percentage" shall be 5%.
"Original Pool Balance" shall be $________________.
"Outstanding" means, when used with respect to Notes, as of
the date of determination, all Notes theretofore authenticated and delivered
under the Indenture except:
(a) Notes theretofore canceled by the Note
Registrar or delivered to the Note Registrar for
cancellation;
(b) 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 that if such Notes are to
be redeemed, notice of such redemption has been duly given
pursuant to the Indenture or provision therefor, satisfactory
to the Indenture Trustee, has been made); and
(c) Notes in exchange for or in lieu of other Notes
which have been authenticated and delivered pursuant to the
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 an Authorized Officer of the Indenture Trustee either
actually knows to be so owned or has received written notice that such Note is
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.
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"Outstanding Amount" means, when used with respect to Notes,
as of any date of determination, the aggregate principal amount of all Notes, or
a class of Notes, as applicable, Outstanding as of such date.
"Owner Trust Estate" means all right, title and interest of
the Issuer in and to the property and rights assigned to the Issuer pursuant to
Article II of this Agreement, all funds on deposit from time to time in the
Trust Accounts (other than the Note Distribution Account) and the Certificate
Distribution Account and all other property of Issuer from time to time,
including any rights of the Owner Trustee and the Issuer pursuant to this
Agreement.
"Owner Trustee" means _______________________, a ________
banking corporation, not in its individual capacity but solely as owner trustee
under the Trust Agreement, and any successor Owner Trustee thereunder.
"Paid-Ahead Account" means, with respect to any Collection
Period and a Actuarial Receivable, any amount collected on such Actuarial
Receivable in excess of the sum of (i) the Scheduled Payment due on such
Actuarial Receivable during such Collection Period and (ii) any past due
Scheduled Payments from prior Collection Periods received during such Collection
Period but not representing a Principal Prepayment in full of such Receivable.
"Paying Agent" means: (a) when used in the Indenture or
otherwise with respect to the Notes, the Indenture Trustee or any other Person
that meets the eligibility standards for the Indenture Trustee specified in
Section 6.11 of the Indenture and is authorized by the Indenture Trustee to make
the payments to and distributions from the Collection Account, [Paid-Ahead
Account] and the Note Distribution Account, including payment of principal of or
interest on the Notes on behalf of the Issuer; and (b) when used in the Trust
Agreement or otherwise with respect to the Certificates, the Owner Trustee or
any other paying agent or co-paying agent appointed pursuant to Section 3.9 of
the Trust Agreement, and in the case of the Indenture with respect to the Notes,
and the Trust Agreement with respect to the Certificates, such Paying Agent
shall initially be the corporate trust office of Chase.
"Permitted Investments" means, at any time, any one or more of
the following obligations, securities (certificated or uncertificated) or
instruments (excluding any security with the "r" symbol attached to its rating):
(i) obligations of the United States of America
or any agency thereof; provided such obligations are
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backed by the full faith and credit of the United States of
America;
(ii) general obligations of or obligations
guaranteed as to the timely payment of interest and principal
by any state of the United States of America or the District
of Columbia then rated "A-1+" or "AAA" by Standard & Poor's,
"F-1+" or "AAA" by Fitch (if rated by Fitch) and "P-1+" or Aaa
by Moody's;
(iii) commercial paper which is then rated P-1 by
Moody's, "F-1+" by Fitch (if rated by Fitch) and "A-1+" by
Standard & Poor's;
(iv) certificates of deposit, demand or time
deposits, federal funds or banker's acceptances issued by any
depository institution or trust company (including the
Indenture Trustee acting in its commercial banking capacity)
incorporated under the laws of the United States or of any
state thereof or incorporated under the laws of a foreign
jurisdiction with a branch or agency located in the United
States of America and subject to supervision and examination
by federal or state banking authorities which short term
unsecured deposit obligations of such depository institution
or trust company are then rated P-1 by Moody's, "F-1+" by
Fitch (if rated by Fitch) and "A-1+" by Standard & Poor's;
(v) demand or time deposits of, or certificates of
deposit issued by, any bank, trust company, savings bank or
other savings institution; provided such deposits or
certificates of deposit are fully insured by the FDIC;
(vi) guaranteed reinvestment agreements issued by
any bank, insurance company or other corporation the short
term unsecured debt or deposits of which are rated P-1 by
Moody's, "AAA" by Fitch (if rated by Fitch) and "A-1+" by
Standard & Poor's or the long-term unsecured debt of which are
rated Aaa by Moody's, "AAA" by Fitch (if rated by Fitch) and
"AAA" by Standard & Poor's;
(vii) repurchase obligations with respect to any
security described in clauses (i) or (ii) herein or any other
security issued or guaranteed by the FHLMC, FNMA or any other
agency or instrumentality of the United States of America
which is backed by the full faith and credit of the United
States of America, in either case entered into with a federal
agency or a depository
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institution or trust company (acting as principal)
described in (iv) above;
(viii) investments in money market funds, which funds
(A) are not subject to any sales, load or other similar
charge; and (B) are rated at least "AAAM" or "AAAM-G" by
Standard & Poor's, "AAAV-1+" by Fitch (if rated by Fitch) and
Aaa by Moody's;
(ix) such other investments where either (A) the
short-term unsecured debt or deposits of the obligor on such
investments are rated "A-1+" by Standard & Poor's, "F-1" by
Fitch (if rated by Fitch) and P-1 by Moody's; and
(x) any other obligation or security satisfying
the Rating Agency Condition.
Permitted Investments may include money market mutual funds (so long as such
fund has the ratings specified in clause (viii) hereof), including, without
limitation, the VISTA U.S. Government Money Market Fund or any other fund for
which Chase, the Indenture Trustee or an Affiliate thereof serves as an
investment advisor, administrator, shareholder servicing agent, and/or custodian
or subcustodian, notwithstanding that (i) Chase,
[_______________________________], [______________________] or an Affiliate
thereof charges and collects fees and expenses from such funds for services
rendered, (ii) Chase, [______________________________], [______________________]
or an Affiliate thereof charges and collects fees and expenses for services
rendered pursuant to this Agreement, and (iii) services performed for such funds
and pursuant to this Agreement may converge at any time. The Indenture Trustee
specifically authorizes Chase, [______________________________],
[______________________] or an Affiliate thereof to charge and collect all fees
and expenses from such funds for services rendered to such funds (but not to
exceed investment earnings), in addition to any fees and expenses Chase,
[_____________________] or [______________________], as applicable, may charge
and collect for services rendered pursuant to this Agreement.
"Person" means a legal person, including any individual,
corporation, limited liability company, estate, partnership, joint venture,
association, joint stock company, trust, unincorporated organization, or
government or any agency or political subdivision thereof, or any other entity
of whatever nature.
"Physical Property" has the meaning specified in the
definition of "Delivery" above.
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"Pool Balance" as of any date of determination means, the
aggregate Principal Balance of the Receivables as of the close of business on
the last day of the preceding Collection Period, after giving effect to all
payments received from Obligors and Repurchase Amounts to be remitted by the
Servicer or the Seller, as the case may be, for such Collection Period and all
losses realized on Receivables liquidated during such Collection Period.
"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 2.5 of the Indenture 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.
"Principal Balance" of a Receivable, as of any date of
determination, means the Amount Financed minus that portion of all payments
received on or prior to such date allocable to principal. The Principal Balance
of a Defaulted Receivable or a Repurchased Receivable shall be deemed to be
zero, in each case, as of such date.
"Principal Distribution Amount" means, for any Distribution
Date, the sum of (i) Available Principal and (ii) Aggregate Net Losses.
"Principal Prepayment" means a payment or other recovery of
principal on a Receivable (including insurance proceeds and Liquidation Proceeds
applied to principal on a Receivable) which is received in advance of its due
date.
"Proceeding" means any suit in equity, action or law or
other judicial or administrative proceeding.
"Qualified Institution" means a depository institution
organized under the laws of the United States of America or any State thereof or
incorporated under the laws of a foreign jurisdiction with a branch or agency
located in the United States of America or any State thereof and subject to
supervision and examination by federal or state banking authorities which at all
times has the Required Deposit Rating and, in the case of any such institution
organized under the laws of the United States of America, whose deposits are
insured by the FDIC.
"Qualified Trust Institution" means an institution organized
under the laws of the United States of America or any State thereof or
incorporated under the laws of a foreign jurisdiction with a branch or agency
located in the United States
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of America or any State thereof and subject to supervision and examination by
federal or state banking authorities which at all times (i) is authorized under
such laws to act as a trustee or in any other fiduciary capacity, (ii) has not
less than one billion dollars in assets under fiduciary management, and (iii)
has a long term deposits rating of not less than "BBB-" by Standard & Poor's,
Baa3 by Moody's and "BBB-" by Fitch (if rated by Fitch).
"Rating Agency" means any of Standard & Poor's, Moody's or
Fitch.
"Rating Agency Condition" means, with respect to any action or
event, that each Rating Agency shall have notified the Seller, the Servicer, the
Indenture Trustee and the Owner Trustee, in writing, that such action or event
will not result in reduction or withdrawal of any then outstanding rating of any
outstanding Note [or Certificate] with respect to which it is the Rating Agency.
"Receivable" means a retail installment sale contract or
purchase money promissory note or other promissory note and security agreement
executed by an Obligor in respect of a Financed Vehicle, and all proceeds
thereof and payments thereunder (other than interest accrued and unpaid as of
the close of business on the Cutoff Date), which Receivable shall be identified
on Schedule A to this Agreement.
"Receivable Files" means the documents specified in
Section 3.3.
"Receivables Pool" means the pool of Receivables included in
the Trust Estate.
"Record Date" means, with respect to any Distribution Date,
the Business Day prior to such Distribution Date unless Definitive Notes [or
Definitive Certificates] are issued, in which case, Record Date, with respect to
such Definitive Notes or Definitive Certificates, as applicable, shall mean the
last day of the immediately preceding calendar month.
"Redemption Date" means in the case of a redemption of the
Notes pursuant to Section 10.1 of the Indenture, the Distribution Date specified
by the Servicer pursuant to such Section 10.1.
"Redemption Price" means in the case of a redemption of the
[Class A-5 Notes] [the Class A-4 Notes and the Class B Notes] pursuant to
Section 10.1 of the Indenture, an amount equal to the Outstanding Amount of the
[Class A-5 Notes] [the Class A-4 Notes and the Class B Notes] plus accrued and
unpaid interest thereon to but excluding the Redemption Date.
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"Relevant UCC" means the Uniform Commercial Code as in
effect in the applicable jurisdiction.
"Repurchase Amount" of a Repurchased Receivable or any
Receivable purchased by the Servicer pursuant to Section 9.1, means the sum, as
of the last day of the Collection Period on which such Receivable becomes such,
of the Principal Balance thereof plus the Accrued Interest thereon.
"Repurchased Receivable" means a Receivable repurchased by the
Seller pursuant to Section 3.2 or purchased by the Servicer pursuant to Section
4.6.
"Required Deposit Rating" shall be a short-term certificate of
deposit rating from Moody's of P-1, from Fitch of "F-1+" (if rated by Fitch) and
from Standard & Poor's of "A-1+," and a long-term unsecured debt rating of not
less than Aa3 by Moody's, "AA" by Fitch (if rated by Fitch) and "AA-" by
Standard & Poor's.
"Reserve Account" means the account designated as such,
established and maintained pursuant to Section 5.6.
"Reserve Account Initial Deposit" means an amount equal
to $_____________.
"Reserve Account Property" means all amounts and investments
held from time to time in the Reserve 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.
"Reserve Account Transfer Amount" means, for any Distribution
Date, an amount equal to the lesser of (a) the amount of cash or other
immediately available funds on deposit in the Reserve Account on such
Distribution Date (before giving effect to any withdrawals therefrom relating to
such Distribution Date) and (b) the amount, if any, by which the sum of the
amounts set forth in clauses (i) through (vi) of Section 5.5(c), inclusive,
exceeds the Total Distribution Amount for such Distribution 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
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of such officer's knowledge of and familiarity with the particular subject.
"Sale Proceeds" has the meaning specified in
Section 9.1(b).
"Sallie Mae Entitlement" means a "Security Entitlement"
as defined in 31 C.F.R. ss. 354.1.
"Scheduled Payment" means, with respect to a Actuarial
Receivable, that portion of the payment required to be made by the Obligor
during each Collection Period sufficient to amortize the Principal Balance of
such Receivable under the related actuarial method over the term of the
Receivable and to provide interest at the related Contract Rate. When Scheduled
Payment is used with reference to a Collection Period, it means the payment
which is due during such Collection Period.
"Securities Act" means the Securities Act of 1933, as
amended.
"Seller" means Chase Manhattan Bank USA, National Association,
a national banking association with its principal executive offices in
Wilmington, Delaware, in its capacity as the seller of the Receivables under
this Agreement, and each successor to Chase Manhattan Bank USA, National
Association (in the same capacity) pursuant to Section 6.3.
"Servicer" means Chase Manhattan Bank USA, National
Association, a national banking association with its principal offices in
Wilmington, Delaware, in its capacity as the servicer of the Receivables under
this Agreement, and each successor to Chase Manhattan Bank USA, National
Association (in the same capacity) pursuant to Section 7.3.
"Servicer's Certificate" means a certificate, substantially in
the form of Exhibit A attached hereto, completed and executed by the Servicer by
its chairman of the board, the president, treasurer, controller or any
executive, senior vice president or vice president pursuant to Section 4.8.
"Servicing Fee" with regard to a Collection Period means the
fee payable to the Servicer for services rendered during such Collection Period,
determined pursuant to Section 4.7.
"Servicing Fee Rate" means 1.00% per annum.
"Settlement Date" means, with respect to any Collection
Period, the last day of the Collection Period immediately preceding such
Collection Period, and with respect to any
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Distribution Date, the last day of the second Collection Period preceding the
Collection Period in which such Distribution Date occurs.
"Simple Interest Method" means the method of allocating a
fixed level payment to principal and interest, pursuant to which the portion of
such payment that is allocated to interest is equal to the product of the fixed
rate of interest multiplied by the unpaid Principal Balance multiplied by the
period of time elapsed since the preceding payment of interest was made and the
remainder of such payment is allocable to principal.
"Specified Reserve Account Balance" with respect to any
Distribution Date, means ____% of the Pool Balance as of the related Settlement
Date, but in any event will not be less than the lesser of (i) $____________ and
(ii) the sum of (A) such Pool Balance; provided that the Specified Reserve
Account Balance will be calculated using a percentage of ____% for any
Distribution Date (beginning with the _________ Distribution Date) for which the
Average Net Loss Ratio exceeds ____% or the Average Delinquency Percentage
exceeds ____%. Upon written notification to the Indenture Trustee by the Seller,
the Specified Reserve Account Balance may be reduced to a lesser amount as
determined by the Seller so long as such reduction satisfies the Rating Agency
Condition.
"Standard & Poor's" means Standard & Poor's Ratings Services,
and its successors and assigns.
"Total Distribution Amount" means, for any Distribution Date,
the sum of Available Interest and Available Principal for such Distribution
Date. The Total Distribution Amount on any Distribution Date shall exclude all
payments and proceeds (including any Liquidation Proceeds and any amounts
received from Dealers with respect to Receivables) of (i) any Receivables the
Repurchase Amount of which has been included in the Total Distribution Amount
for a prior Distribution Date and (ii) Investment Earnings and any Late Fees.
"Treasury Entitlement" means a "Security Entitlement"
as defined in 31 C.F.R. ss. 357.2.
"Treasury Regulations" means, the treasury regulations
promulgated under Code.
"Trust Accounts" means, collectively, the Collection Account,
[the Paid-Ahead Account,] the Note Distribution Account and the Reserve Account.
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"Trust Agreement" means the Trust Agreement dated as ________
__, ____, between the Seller and the Owner Trustee, as the same may be amended
and supplemented from time to time.
"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 the Indenture for the benefit of the Noteholders (including all
property and interests Granted to the Indenture Trustee), including all proceeds
thereof and the Reserve Account.
"Trust Indenture Act" or "TIA" means the Trust Indenture Act
of 1939 as in force on the date hereof, unless otherwise specifically provided.
"United States Securities Entitlement" means a Treasury
Entitlement, a HUD Entitlement, a FHL Bank Entitlement, a Funding Corporation
Entitlement, a Farm Credit Entitlement or a Sallie Mae Entitlement.
["____________ Class A-1 Note Distribution" means the amount
distributable from the Collection Account pursuant to Section 5.5(b) to the
Noteholders of the Class A-1 Notes on the __________ Distribution Date with
respect to the Class A-1 Notes if the Class A-1 Event has occurred.]
SECTION 1.2. Usage of Terms. With respect to all terms in this
Agreement, the singular includes the plural and the plural the singular; words
importing any gender include the other gender; references to "writing" include
printing, typing, lithography, and other means of reproducing words in a visible
form; references to agreements and other contractual instruments include all
subsequent amendments thereto or changes therein entered into in accordance with
their respective terms and not prohibited by this Agreement; references to
Persons include their permitted successors and assigns; and the term "including"
means "including without limitation." All references herein to Articles,
Sections, Subsections and Exhibits are references to Articles, Sections,
Subsections and Exhibits contained in or attached to this Agreement unless
otherwise specified, and each such Exhibit is part of the terms of this
Agreement.
SECTION 1.3. [Simple Interest [and Actuarial] Method;]
[Methods of Allocating Payments or Receivables;] Allocations. All allocations of
payments to principal and interest and determinations of periodic charges and
the like on the [Simple Interest] Receivables shall be based on a year with the
actual number of days in such year and twelve months with the actual number of
days in each such month. [Allocations of payments to principal and interest on
the Actuarial Receivables shall be based on the related add-on financed charge
and related
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precomputed scheduled payment calculated in accordance with the actuarial method
set forth in the related Receivable.]
Each payment on a Receivable shall be applied first to the amount of
interest accrued on such Receivable to the date of receipt, then to reduce the
scheduled principal amount outstanding on the Receivable to the extent of the
remaining scheduled payment and then to any outstanding fees and Late Fees under
the terms of the Receivable. Amounts paid by the Seller or the Servicer in
respect of Repurchased Receivables shall be allocated first to any Accrued
Interest and then to the Principal Balance of the related Receivable.
[SECTION 1.4. Calculations Relating to the __________
Distribution Date]. If the Class A-1 Event has occurred, the calculations
hereunder for the __________ Distribution Dates with respect to the Total
Distribution Amount, the [Class A] Noteholders' Distributable Amount, [Class B
Noteholders' Distributable Amount,] [the Certificateholders' Distributable
Amount,] the Specified Reserve Account Balance and the Reserve Account Transfer
Amount, and the respective components thereof, shall be calculated as if there
were a single __________ Distribution Date. Amounts hereunder will be
distributed on the respective __________ Distribution Dates in accordance with
Section 5.5(d).]
ARTICLE II
CONVEYANCE OF RECEIVABLES
SECTION 2.1. Conveyance of Receivables. In consideration of
the Issuer's delivery of the Notes and the Certificates to and upon the order of
the Seller, the Seller does hereby sell, transfer, assign, and otherwise convey
to the Issuer, without recourse (subject to the Seller's obligations herein):
(i) all right, title, and interest of the Seller
in, to and under the Receivables listed in Schedule A hereto,
all proceeds thereof and all amounts and monies received
thereon on or after the Cutoff Date (including proceeds of the
repurchase of Receivables by the Seller pursuant to Section
3.2 or the purchase of Receivables by the Servicer pursuant to
Section 4.6 or 9.1), together with the interest of the Seller
in the security interests in the Financed Vehicles granted by
the Obligors pursuant to the Receivables and in any
repossessed Financed Vehicles;
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(ii) all right, title and interest of the Seller in
any Liquidation Proceeds and in any proceeds of any extended
warranties, theft and physical damage, credit life or credit
disability policies relating to the Financed Vehicles or the
Obligors;
(iii) all right, title and interest of the Seller
in any proceeds from Dealer repurchase obligations
relating to the Receivables; and
(iv) all proceeds (as defined in the Relevant UCC)
of the foregoing.
In connection with such sale, the Seller agrees to record and
file, at its own expense, financing statements (and continuation statements with
respect to such financing statements when applicable) with respect to the
Receivables for the sale of accounts and chattel paper meeting the requirements
of applicable state law in such manner and in such jurisdictions as are
necessary to perfect the sale and assignment of the Receivables to the Issuer.
It is the intention of the Seller and the Issuer that the
assignment and transfer herein contemplated constitute a sale of the
Receivables, conveying good title thereto free and clear of any liens and
encumbrances, from the Seller to the Issuer and the Receivables not be part of
the Seller's estate in the event of an insolvency. In the event that such
conveyance is deemed to be a pledge to secure a loan, the Seller hereby grants
to the Issuer a first priority perfected security interest in all of the
Seller's right, title and interest in, to and under the items of property listed
in clauses (i) through (iii) above, and in all proceeds (as defined in the
Relevant UCC) of the foregoing, to secure the loan deemed to be made in
connection with such pledge and, in such event, this Agreement shall constitute
a security agreement under applicable law.
SECTION 2.2. Closing. The conveyance of the Receivables shall
take place at the offices of ________________________________, New York, New
York on the Closing Date, simultaneously with the closing of the transactions
contemplated by the underwriting agreements related to the Notes [and the
Certificates] and the other Basic Documents. Upon the acceptance by the Seller
of the Notes and the Certificates, the ownership of each Receivable and the
contents of the related Receivable File will be vested in the Issuer, subject
only to the lien of the Indenture.
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ARTICLE III
THE RECEIVABLES
SECTION 3.1. Representations and Warranties of Seller;
Conditions Relating to Receivables.
(a) The Seller makes the following representations and
warranties as to the Receivables on which the Issuer shall rely in acquiring the
Receivables. Such representations and warranties shall speak as of the Cutoff
Date unless otherwise specified, 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.
(i) Schedule of Receivables. The information set
forth in Schedule A hereto with respect to each Receivable is
true and correct in all material respects, and no selection
procedures materially adverse to the Holders has been utilized
in selecting the Receivables from all receivables owned by the
Seller which meet the selection criteria specified herein.
(ii) No Sale or Transfer. No Receivable has been
sold, transferred, assigned or pledged by the Seller to
any Person other than the Issuer.
(iii) Good Title. Immediately prior to the transfer
and assignment of the Receivables to the Issuer herein
contemplated, the Seller has good and marketable title to each
Receivable free and clear of all Liens and rights of others;
and, immediately upon the transfer thereof, the Issuer has
either (i) good and marketable title to each Receivable, free
and clear of all Liens and rights of others, other than the
Lien of the Indenture Trustee under the Indenture, and the
transfer has been perfected under applicable law or (ii) a
first priority perfected security interest in each Receivable
and the proceeds thereof.
(b) Each Receivable satisfies the following conditions as of
the Cutoff Date unless otherwise specified and such conditions 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.
(i) Acquisition. Each Receivable is either a
Dealer Receivable acquired directly or indirectly from or
made through a Dealer located in the United States
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(including the District of Columbia) or is a Direct Receivable;
(ii) Security. Each Receivable is secured by a
new or used automobile or light-duty truck;
(iii) Maturity of Receivables. Each Receivable had a
remaining maturity of not less than ___ months nor greater than ___
months, and (A) in the case of each Receivable secured by new Financed
Vehicles, had an original maturity of at least ___ months and not more
than ___ months, or (B) in the case of each Receivable secured by used
Financed Vehicles, had an original maturity of at least ___ months and
not more than ___ months.
(iv) Contract Rate. Each Receivable is a fully-
amortizing fixed rate simple interest [or actuarial] contract that
provides for level scheduled monthly payments over its remaining term,
and has a Contract Rate of at least ____% and not more than ____ %;
(v) No Repossessions. Each Receivable is secured
by a Financed Vehicle that had not been repossessed without
reinstatement of such Receivable;
(vi) Obligor Not Subject to Bankruptcy Proceedings.
Each Receivable has been entered into by an Obligor who had not been
identified on the computer files of the Seller as in bankruptcy
proceedings as of the Cutoff Date;
(vii) No Overdue Payments. Each Receivable had no
payment that was more than 30 days past due;
(viii) [Reserved];
(ix) Remaining Principal Balance. Each Receivable
had a remaining principal balance of at least $_____ and not greater
than $______;
(x) No Force Placed Insurance. As of the Cutoff
Date, each Receivable was secured by a Financed Vehicle that
was not insured by a force placed insurance policy or any
vendor's single interest and non-filing insurance policy;
(xi) Receivable Files. The Receivable Files shall
be kept at one or more of the locations specified in Schedule B hereto;
(xii) Characteristics of Receivables. Each
Receivable (a) (i) in the case of a Dealer Receivable, has
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been originated in the form of a credit sales transaction by a Dealer
or a purchase money loan or other notes through a Dealer located in one
of the States of the United States (including the District of Columbia)
for the retail financing of a Financed Vehicle or (ii) in the case of a
Direct Receivable, has been originated by Chase or an affiliate thereof
in the form of a secured loan for the retail financing of a Financed
Vehicle, and, in each case, has been fully and properly executed by the
parties thereto, (b) (i) in the case of a Dealer Receivable, if a
retail installment sales contract, has been purchased by the Seller
from the originating Dealer or an affiliate of the Seller, has been
validly assigned by such Dealer or an affiliate of the Seller to the
Seller in accordance with its terms or (ii) in the case of a Chase
Direct Receivable, has been purchased by the Seller from Chase, and has
been validly assigned by Chase to the Seller; (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 fully amortizing
level scheduled monthly payments (provided that[, in the case of Simple
Interest Receivables,] the payment in the last month in the life of the
Receivable may be different from the level scheduled payment) and for
accrual of interest at a fixed rate according to the simple interest
method;
(xiii) Compliance with Laws. Each Receivable and each
sale of the related Financed Vehicle complied at the time it was
originated or made, and complied on and after the Cutoff Date, in all
material respects with all requirements of applicable federal, state,
and local laws, and regulations thereunder, including usury laws, the
Federal Truth-in-Lending Act, the Equal Credit Opportunity Act, the
Fair Credit Reporting Act, the Federal Trade Commission Act, the
Magnuson-Moss Warranty Act, Federal Reserve Board Regulations B and Z,
state adaptations of the National Consumer Act and of the Uniform
Consumer Credit Code, and any other consumer credit, equal opportunity,
and disclosure laws applicable to such Receivable and sale thereof;
(xiv) Binding Obligation. Each Receivable constitutes
the legal, valid, and binding payment obligation in writing of the
Obligor, enforceable by the holder thereof in all material respects in
accordance with its terms, subject, as to enforcement, to applicable
bankruptcy, insolvency, reorganization, liquidation and other similar
laws and equitable principles relating to or affecting the enforcement
of creditors' rights;
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(xv) No Government Obligor. Each Receivable is not
due from the United States of America or any State or from any agency,
department, instrumentality or political subdivision of the United
States of America or any State or local municipality, and each
Receivable is not due from a business except to the extent that such
Receivable has a personal guaranty;
(xvi) Security Interest in Financed Vehicle.
Immediately prior to the sale and assignment thereof to the Issuer as
herein contemplated, each Receivable was secured by a validly perfected
first priority security interest in the related Financed Vehicle in
favor of or for the benefit of the Seller as secured party (subject to
administrative delays and clerical errors on the part of the applicable
governmental agency and to any statutory or other lien arising by
operation of law after the Closing Date which is prior to such security
interest), the Seller's security interest (or beneficial interest
therein) is assignable, and has been so assigned by the Seller to the
Issuer (subject to administrative delays and clerical errors on the
part of the applicable governmental agency and to any statutory or
other lien arising by operation of law after the Closing Date which is
prior to such security interest);
(xvii) Receivables in Force. No Receivable has been
satisfied, subordinated, or rescinded, nor has any Financed
Vehicle been released from the Lien granted by the related
Receivable, in whole or in part;
(xviii) No Waiver. No provision of a Receivable has
been waived in such a manner that such Receivable fails either to meet
all of the representations and warranties made by the Seller herein
with respect thereto or to meet all of the conditions with respect
thereto pursuant to this Section 3.1(b);
(xix) No Amendments. No Receivable has been amended
except pursuant to either instruments included in the Receivable Files
or instruments to be included in the Receivable Files pursuant to
Section 4.2 (or otherwise maintained by the Seller in the ordinary
course of its business), and no such amendment has caused such
Receivable either to fail to meet all of the representations and
warranties made by the Seller herein with respect thereto or to fail to
meet all of the conditions with respect thereto pursuant to this
Section 3.1(b);
(xx) No Defenses. The Seller had no knowledge
either of any facts which would give rise to any right of
rescission, setoff, counterclaim, or defense, or of the same
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being asserted or threatened, with respect to any Receivable;
(xxi) No Liens. The Seller had no knowledge of any
Liens or claims that have been filed, including liens for work, labor,
materials or unpaid taxes relating to a Financed Vehicle, that would be
liens prior to, or equal or coordinate with, the lien granted by the
Receivable;
(xxii) No Default. Except for payment defaults
continuing for a period of not more than 30 days as of the close of
business on the Cutoff Date, the Seller has no knowledge that a
default, breach, violation, or event permitting acceleration under the
terms of any Receivable exists; the Seller has no knowledge that a
continuing condition that with notice or lapse of time would constitute
a default, breach, violation, or event permitting acceleration under
the terms of any Receivable exists; and the Seller has not waived any
of the foregoing;
(xxiii) Insurance. Each Receivable requires that the
Obligor thereunder maintain comprehensive, liability, theft
and physical damage insurance covering the related Financed
Vehicle;
(xxiv) Lawful Assignment. No Receivable has been
originated in, or is subject to the laws of, any
jurisdiction under which the sale, transfer, and assignment
of such Receivable under this Agreement or pursuant to
transfers of the Certificates or the Notes is unlawful, void
or voidable;
(xxv) All Filings Made. No filings (other than
filings under the Relevant UCC which have been made) or
other actions are necessary in any jurisdiction to give the
Issuer a first perfected security interest in the
Receivables;
(xxvi) One Original. There is no more than one
original executed copy of each Receivable which, immediately
prior to the delivery thereof to the Servicer (as custodian
for the Issuer), was in the possession of the Seller;
(xxvii) Excluded Loans. Each Receivable (A) is not a
Receivable whose related Obligor resides in the State of Alabama (in
the case of a Direct Receivable) or a Receivable originated by or
through a Dealer located in the State of Alabama (in the case of a
Dealer Receivable), and (B) has not been the subject of a previous
securitization; and
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(xxviii) Account Number. Each Dealer Receivable has been
assigned an account number that corresponds to the number assigned to
the Dealer from or through whom such Receivable was acquired, and each
Direct Receivable has been assigned an account number that corresponds
to the number assigned to the applicable originating branch (or the
"loanby-phone" line).
SECTION 3.2. Repurchase Upon Breach or Failure of a Condition.
The Seller, the Servicer, the Indenture Trustee or the Owner Trustee, as the
case may be, shall inform the other parties in writing, upon the discovery by
the Seller, the Servicer or an Authorized Officer of the Indenture Trustee or
the Owner Trustee of either any breach of the Seller's representations and
warranties set forth in Section 3.1(a) or the failure of any Receivable to
satisfy any of the conditions set forth in Section 3.1(b) which materially and
adversely affects the Holders' interest in any Receivable. Unless the breach or
failed condition shall have been cured by the last day of the Collection Period
following the Collection Period in which such discovery occurred (or, at the
Seller's option, the last day of the Collection Period in which such discovery
occurred), the Seller shall repurchase any Receivable the Holders' interest in
which was materially and adversely affected by the breach or failed condition,
as of such last day. Notwithstanding anything herein to the contrary, with
respect to the breach of a representation and warranty in Section
3.1(b)(xxviii), the Seller shall repurchase such Receivable regardless of its
effect on the interest of the Holders in such Receivable or whether notice
thereof has been delivered by any of the parties thereto, and the repurchase of
any such Receivable shall take place at any time as is administratively
convenient for the Seller and the Servicer. In consideration of the repurchase
of a Receivable, the Seller shall remit the Repurchase Amount of such Receivable
as of such last day (less any Liquidation Proceeds deposited, or to be
deposited, by the Servicer in the Collection Account with respect to such
Receivable pursuant to Section 4.3) in the manner specified in Section 5.4. The
sole remedy of the Issuer, the Indenture Trustee or the Holders with respect
either to a breach of the Seller's representations and warranties set forth in
Section 3.1(a) or to a failure of any of the conditions set forth in Section
3.1(b) shall be to require the Seller to repurchase Receivables pursuant to this
Section 3.2. The obligation of the Seller to repurchase under this Section 3.2
shall not be dependent upon the actual knowledge of the Seller of any breached
representation or warranty. 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 3.2 or the eligibility of
any Receivable for purposes of this Agreement.
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SECTION 3.3. Custody of Receivable Files. To assure uniform
quality in servicing the Receivables and to reduce administrative costs, the
Issuer, upon the execution and delivery of this Agreement, agrees to have the
Servicer act as custodian of the following documents or instruments (the
"Receivable Files") which are hereby constructively delivered to the Issuer with
respect to each Receivable:
(i) The original executed Receivable;
(ii) Any and all other documents or records that the
Seller or the Servicer, as the case may be, shall keep on
file, in accordance with its customary procedures, relating to
a Receivable, an Obligor, or a Financed Vehicle.
The Servicer hereby agrees to act as custodian and as agent
for the Issuer hereunder. The Servicer acknowledges that it holds the documents
and instruments relating to the Receivables for the benefit of the Issuer. The
Issuer shall have no responsibility to monitor the Servicer's performance as
custodian and shall have no liability in connection with the Servicer's
performance of such duties hereunder.
SECTION 3.4. Duties of Servicer as Custodian.
(a) Safekeeping. The Servicer, in its capacity as custodian,
shall hold the Receivable Files on behalf of the Issuer, and maintain such
accurate and complete accounts, records (either original execution documents or
copies of such originally executed documents shall be sufficient), and computer
systems pertaining to the Receivables as shall enable the Issuer to comply with
its obligations pursuant to this Agreement. In performing its duties as
custodian, the Servicer shall act with reasonable care, using that degree of
skill and attention that the Servicer exercises with respect to the receivable
files of comparable new or used automobile receivables that the Servicer
services for itself. The Servicer shall conduct, or cause to be conducted,
periodic audits of the files of all receivables owned or serviced by the
Servicer which shall include the Receivable Files held by it under this
Agreement and the related accounts, records, and computer systems, in such a
manner as shall enable the Owner Trustee or the Indenture Trustee to identify
all Receivable Files and such related accounts, records and computer systems and
to verify, if the Owner Trustee or the Indenture Trustee so elects, the accuracy
of the Servicer's recordkeeping. The Servicer shall promptly report to the Owner
Trustee or 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 promptly take appropriate action to remedy any such failure.
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(b) Maintenance of and Access to Records. The Servicer shall
maintain each Receivable File at one of the locations specified in Schedule B to
this Agreement, or at such other location as shall be specified to the Owner
Trustee and the Indenture Trustee by 30 days' prior written notice. The Servicer
shall make available to the Owner Trustee, the Indenture Trustee or their
respective duly authorized representatives, attorneys, or auditors, the
Receivable Files and the related accounts, records, and computer systems
maintained by the Servicer at such times during normal operating hours as the
Owner Trustee or Indenture Trustee shall reasonably instruct which does not
unreasonably interfere with the Servicer's normal operations or customer or
employee relations.
(c) Release of Documents. Upon instruction from the Indenture
Trustee (or, if the Notes have been paid in full, from the Owner Trustee), the
Servicer shall release any document in the Receivable Files to the Indenture
Trustee or Owner Trustee, or their respective agents or designee as the case may
be, at such place or places as such Person may reasonably designate as soon as
reasonably practicable to the extent it does not unreasonably interfere with the
Servicer's normal operations or customer or employee relations. The Servicer
shall not be responsible for any loss occasioned by the failure of the Owner
Trustee or Indenture Trustee, or their respective agents or designees, to return
any document or any delay in doing so.
(d) Title to Receivables. The Servicer agrees that, in respect
of any Receivable held by it as custodian hereunder, (i) the Servicer will not
at any time have or in any way attempt to assert any interest in such Receivable
or the related Receivable File, other than solely for the purpose of collecting
or enforcing the Receivable for the benefit of the Issuer and (ii) the related
Receivable File shall at all times be property of the Issuer.
SECTION 3.5. Instructions; Authority to Act. The Servicer
shall be deemed to have received proper instructions with respect to the
Receivable Files upon its receipt of written instructions signed by an
Authorized Officer of the Indenture Trustee (or, if the Notes have been paid in
full, of the Owner Trustee). A certified copy of a by-law or of a resolution of
the Board of Directors of the Owner Trustee or the Indenture Trustee shall
constitute conclusive evidence of the authority of any such Authorized Officer
to act and shall be considered in full force and effect until receipt by the
Servicer of written notice to the contrary given by the Owner Trustee or the
Indenture Trustee.
SECTION 3.6. Custodian's Indemnification. The Servicer, as
custodian, shall indemnify the Issuer, the Owner Trustee and the Indenture
Trustee for any and all liabilities,
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obligations, losses, damages, payments, costs, or expenses of any kind
whatsoever that may be imposed on, incurred, or asserted against the Issuer, the
Owner Trustee or the Indenture Trustee as the result of any act or omission in
any way relating to the maintenance and custody by the Servicer, as custodian,
of the Receivable Files; provided, however, that the Servicer shall not be
liable for any portion of any such amount resulting from the wilful misfeasance,
bad faith, or negligence of the Issuer, the Owner Trustee or the Indenture
Trustee.
SECTION 3.7. Effective Period and Termination. The Servicer's
appointment as custodian shall become effective as of the Cutoff Date and shall
continue in full force and effect until terminated pursuant to this Section 3.7
or until this Agreement shall be terminated. If the Servicer shall resign as
Servicer under Section 7.5 or if all of the rights and obligations of the
Servicer shall have been terminated under Section 8.1, the appointment of the
Servicer as custodian may be terminated by the Indenture Trustee or by the
Holders of Notes evidencing not less than a majority of the aggregate
Outstanding Amount of the Notes (or, if there are no Notes outstanding, the
Holders of Certificates representing not less than a majority of the Certificate
Balance), in the same manner as the Indenture Trustee or such Holders may
terminate the rights and obligations of the Servicer under Section 8.1. As soon
as practicable after any termination of such appointment, the Servicer shall, at
its expense, deliver the Receivable Files to the Issuer or the Issuer's agent at
such place or places as the Issuer may reasonably designate. Notwithstanding the
termination of the Servicer as custodian, the Owner Trustee agrees that upon any
such termination, the Issuer shall provide, or cause its agent to provide,
access to the Receivable Files to the Servicer for the purpose of carrying out
its duties and responsibilities with respect to the servicing of the Receivables
hereunder.
ARTICLE IV
ADMINISTRATION AND SERVICING OF RECEIVABLES
SECTION 4.1. Duties of Servicer. The Servicer is hereby
authorized to act as agent for the Issuer and in such capacity shall manage,
service, administer and make collections on the Receivables (other than
Repurchased Receivables) with reasonable care, using that degree of skill and
attention that the Servicer exercises with respect to comparable new or used
automobile receivables that it services for itself. The Servicer's duties shall
include collection and posting of all payments, responding to inquiries by
Obligors or by federal, state, or local governmental authorities with respect to
the Receivables, investigating delinquencies, reporting tax
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information to Obligors in accordance with its customary practices, advancing
costs of disposition of defaults, monitoring Receivables in cases of Obligor
defaults, accounting for collections, furnishing monthly and annual statements
to the Indenture Trustee with respect to distributions. The Servicer shall
follow its customary standards, policies, and procedures in performing its
duties as Servicer hereunder; provided that the Servicer shall be permitted to
take or to refrain from taking any action not specified in this Agreement with
respect to servicing the Receivables if such action or inaction would not
contravene any material term of this Agreement or materially adversely affect
the interests of Holders. Without limiting the generality of the foregoing, the
Servicer shall be authorized and empowered by the Issuer to execute and deliver,
on behalf of itself, the Owner Trustee, the Indenture Trustee and the Holders,
or any of them, any and all instruments of satisfaction or cancellation, or of
partial or full release or discharge, and all other comparable instruments,
without recourse to the Issuer, with respect to the Receivables or with respect
to the Financed Vehicles. If the Servicer shall commence a legal proceeding to
enforce a Receivable or a Defaulted Receivable, the Issuer shall thereupon be
deemed to have automatically assigned such Receivable and the related property
conveyed to the Issuer with respect to such Receivable to the Servicer, solely
for the purpose of collection. The Owner Trustee shall furnish the Servicer with
such documents as have been prepared by the Servicer for execution by the Owner
Trustee and as are necessary or appropriate to enable the Servicer to carry out
its servicing and administrative duties hereunder.
SECTION 4.2. Collection of Receivable Payments; Refinancing.
(a) The Servicer shall make reasonable efforts to collect all payments called
for under the terms and provisions of the Receivables and of this Agreement as
and when the same shall become due, and shall follow such collection procedures
as it follows with respect to comparable new or used automobile receivables that
it services for itself and that are consistent with prudent industry standards.
In connection therewith, the Servicer may grant extensions, rebates or
adjustments on a Receivable without the consent of the Issuer; 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 such Receivable pursuant to Section 4.6. The Servicer is authorized
in its discretion to waive any Late Fees that may be due in the ordinary course
of collecting a Receivable; provided, further, the Servicer shall not agree to
any change in the underlying Contract Rate on any Receivable, to any change in
the Principal Balance thereof (except with respect to a prepayment of a
scheduled payment that does not result in a deferral of any other scheduled
payment), to any reduction of the total number of payments due thereunder or,
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subject to the foregoing, to any reduction of the amount of any scheduled
payment on a Receivable. In the event that at the end of the scheduled term of
any Receivable, the outstanding principal amount thereof is such that the final
payment to be made by the related Obligor is larger than the regularly scheduled
payment of principal and interest made by such Obligor, the Servicer may permit
such Obligor to pay such remaining principal amount in more than one payment of
principal and interest; provided, however, that the last such payment shall be
due on or prior to the Final Scheduled Maturity Date.
(b) Notwithstanding anything in this Agreement to the
contrary, the Servicer may refinance any Receivable by accepting a new
promissory note from the related Obligor and applying the proceeds of such
refinancing to pay all obligations in full of such Obligor under such
Receivable. The receivable created by the refinancing shall not be property of
the Issuer.
SECTION 4.3. Realization Upon Receivables. The Servicer shall
use reasonable efforts, consistent with its customary servicing procedures, to
repossess or otherwise take possession of the Financed Vehicle securing any
Receivable which the Servicer shall have determined to be a Defaulted Receivable
or otherwise. The Servicer shall follow such customary and usual practices and
procedures as it shall deem necessary or advisable in its servicing of new or
used automobile receivables, which may include reasonable efforts to realize
upon any recourse to Dealers, consigning the Financed Vehicle to a Dealer for
resale and selling the Financed Vehicle at public or private sale. The Servicer
shall be entitled to recover from proceeds all reasonable expenses incurred by
it in the course of converting the Financed Vehicle into cash proceeds. The
Liquidation Proceeds with respect to a Receivable shall be deposited by the
Servicer in the Collection Account in the manner specified in Section 5.2 and
shall be applied to reduce (or to satisfy, as the case may be) the Repurchase
Amount of the Receivable, if such Receivable is to be repurchased by the Seller
pursuant to Section 3.2, or is to be purchased by the Servicer pursuant to
Section 4.6. The foregoing shall be subject to the provision that, in any case
in which a Financed Vehicle shall have suffered damage, the Servicer shall not
expend funds in connection with the repair or the repossession of such Financed
Vehicle unless it shall determine in its sole discretion that such repair and/or
repossession will increase the Liquidation Proceeds of the related Receivable by
an amount equal to or greater than the amount of such expenses.
SECTION 4.4. Maintenance of Security Interests in Financed
Vehicles. The Servicer, in accordance with its customary servicing procedures,
shall take such steps as are necessary to maintain perfection of the first
priority security
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interest of the Seller created in any Financed Vehicle which secures a
Receivable. The Owner Trustee, on behalf of the Issuer, and the Indenture
Trustee hereby authorize the Servicer, and the Servicer hereby agrees, to take
such steps as are necessary to re-perfect such security interest in the event of
the relocation of a Financed Vehicle or for any other reason, in either case,
when the Servicer has knowledge of the need for such re-perfection. In the event
that the assignment of a Receivable to the Issuer and by the Issuer to the
Indenture Trustee pursuant to the Indenture is insufficient without a notation
on the related Financed Vehicle's certificate of title, or without fulfilling
any additional administrative requirements under the laws of the State in which
the Financed Vehicle is located, to grant to the Indenture Trustee a perfected
security interest in the related Financed Vehicle, the Seller and Servicer
hereby agree that the Seller's listing as the secured party on the certificate
of title is deemed to be in its capacity as agent of the Indenture Trustee and
the Servicer further agrees to hold such certificate of title as the Indenture
Trustee's agent and custodian; provided, however, that the Servicer shall not,
nor shall the Owner Trustee, the Indenture Trustee or Holders have the right to
require that the Servicer, make any such notation on the related Financed
Vehicles' certificate of title or fulfill any such additional administrative
requirement of the laws of the State in which a Financed Vehicle is located.
SECTION 4.5. Covenants of Servicer. The Servicer hereby makes
the following covenants on which the Issuer will rely in accepting the
Receivables:
(i) Security Interest to Remain in Force. The
Financed Vehicle securing each Receivable shall not be
released from the security interest granted by the
Receivable in whole or in part except if such Financed
Vehicle is substituted in whole by the manufacturer,
dealer or seller as a result of mechanical defects or a
total loss of the Financed Vehicle because of accident
or theft or as otherwise contemplated herein;
(ii) No Impairment. The Servicer shall not impair
the rights of the Issuer, the Indenture Trustee or any Holder
in the Receivables; and
(iii) Extensions; Defaulted Receivables. The
Servicer shall not increase the number of payments under a
Receivable, nor increase the Amount Financed under a
Receivable, nor extend or forgive payments on a Receivable,
except as provided in Section 4.2.
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SECTION 4.6. Purchase of Receivables Upon Breach. The Seller,
the Servicer, the Indenture Trustee or the Owner Trustee, as the case may be,
shall inform the other parties promptly, in writing, upon the discovery by the
Seller, the Servicer or an Authorized Officer of the Indenture Trustee or the
Owner Trustee, as the case may be, of any breach by the Servicer of its
covenants under Section 4.5 which materially and adversely affects the interest
of the Holders in any Receivable (for this purpose, any breach of the covenant
set forth in Section 4.5(iii) shall be deemed to materially and adversely affect
the interest of the Holders in a Receivable). Except as otherwise specified in
Section 4.2, unless the breach shall have been cured by the last day of the
Collection Period following the Collection Period in which such discovery
occurred (or, at the Servicer's election, the last day of the Collection Period
in which such discovery occurred), the Servicer shall purchase any Receivable
materially and adversely affected by such breach as of such last day. In
consideration of the purchase of such Receivable, the Servicer shall remit the
Repurchase Amount (less any Liquidation Proceeds deposited, or to be deposited,
by the Servicer in the Collection Account with respect to such Receivable
pursuant to Section 4.3) in the manner specified in Section 5.4. The sole remedy
of the Issuer, the Owner Trustee, the Indenture Trustee or the Holders against
the Servicer with respect to a breach pursuant to Section 4.2 or 4.5 shall be to
require the Servicer to purchase Receivables pursuant to this Section 4.6. 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 4.6 or the eligibility of any Receivable for purposes
of this Agreement.
SECTION 4.7. Servicing Fee. The Servicing Fee for a Collection
Period shall be payable on the related Distribution Date pursuant to Section 5.5
and shall equal the sum of (i) the product of one-twelfth of the Servicing Fee
Rate and the Pool Balance as of the related Settlement Date and (ii) Late Fees
received from Obligors during such Collection Period. In addition, as part of
the Servicing Fee, the Servicer shall be entitled to receive on each
Distribution Date Investment Earnings when and as paid on amounts on deposit in
the Collection Account or earned on collections pending deposit in the
Collection Account. The Servicer shall be required to pay from its own account
all expenses incurred by it in connection with its activities hereunder
(including fees and disbursements of independent accountants and auditors, taxes
imposed on the Servicer, and other costs incurred in connection with
administering and servicing the Receivables) and the fees and disbursements of
the Issuer, the Administrator, the Owner Trustee, the Indenture Trustee, the
Owner Trustee's and the Indenture Trustee's counsel, the Paying Agent, the
Authenticating Agent, the Note Registrar and the Certificate Registrar except
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for United States federal, state and local income and franchise taxes, if any,
imposed on the Issuer or any Holder or any expenses in connection with realizing
upon Receivables under Section 4.3.
SECTION 4.8. Servicer's Certificate. On or before each
Determination Date, the Servicer shall deliver to the Indenture Trustee, the
Owner Trustee, the Paying Agent and the Rating Agencies a Servicer's
Certificate, substantially in the form of Exhibit A hereto, for the Collection
Period preceding such Determination Date, containing all information necessary
to make the distributions pursuant to Section 5.5, and all information necessary
for the Paying Agent to send statements to Holders pursuant to Section 5.8[;
provided, however, that if the Class A-1 Event has occurred, the Servicer shall
deliver the Servicer's Certificate for the __________ Collection Period to such
parties no later than _____________.] The Servicer shall deliver to the Rating
Agencies any information, to the extent it is available to the Servicer, that
the Rating Agencies reasonably request in order to monitor the Issuer. The
Servicer shall also specify each Receivable which the Seller or the Servicer is
required to repurchase or purchase, as the case may be, as of the last day of
the preceding Collection Period and each Receivable which the Servicer shall
have determined to be a Defaulted Receivable during the preceding Collection
Period. Subsequent to the Closing Date, the form of Servicer's Certificate may
be revised or modified to cure any ambiguities or inconsistencies between such
form and this Agreement; provided, however, that no material information shall
be deleted from the form of Servicer's Certificate. In the event that the form
of Servicer's Certificate is revised or modified in accordance with the
preceding sentence, a form thereof, as so revised or modified, shall be provided
to the Owner Trustee, the Paying Agent, the Indenture Trustee and each Rating
Agency.
SECTION 4.9. Annual Statement as to Compliance. (a) The
Servicer shall deliver to a firm of independent certified public accountants, on
or before March 31 of each year commencing March 31, ____, a certificate signed
by the chairman of the board, the president, the treasurer, the controller, any
executive or senior vice president or any vice president of the Servicer,
stating that (a) a review of the activities of the Servicer during the year
ended the preceding December 31 (or the period since the Cutoff Date in the case
of the first such certificate) and of its performance under this Agreement has
been made under such officer's supervision and (b) to the best of such officer's
knowledge, based on such review, the Servicer has fulfilled all its obligations
in all material respects under this Agreement throughout such year (or the
period since the Cutoff Date in the case of the first such certificate), or, if
there has been a default in the fulfillment of any such obligation,
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specifying each such default known to such officer and the nature and status
thereof.
(b) The Servicer shall deliver to the Indenture Trustee, the
Owner Trustee and each Rating Agency promptly after having obtained knowledge
thereof, but in no event later than five Business Days thereafter, an Officer's
Certificate specifying any event which with the giving of notice or lapse of
time, or both, would become an Event of Servicing Termination under Section 8.1.
The Seller shall deliver to the Indenture Trustee and the Owner Trustee,
promptly after having obtained knowledge thereof, but in no event later than
five Business Days thereafter, an Officer's Certificate specifying any event
which with the giving of notice or lapse of time, or both, would become an Event
of Servicing Termination under Section 8.1.
SECTION 4.10. Annual Audit Report. The Servicer shall cause a
firm of independent public accountants (which may provide other services to the
Servicer or the Seller) to prepare a report (with a copy of the certificate
described in Section 4.9(a) attached) addressed to the Board of Directors of the
Servicer, for the information and use of the Indenture Trustee, the Owner
Trustee and the Rating Agencies on or before March of each year, beginning March
31, ____, to the effect that, with respect to the twelve months ended the
preceding December 31 (or the period since the Cutoff Date, in the case of the
first such certificate), such firm has either (A) examined a written assertion
by the Servicer about the effectiveness of the Servicer's internal control
structure over the processing and reporting of transactions relating to
securitized automobile loans with respect to the criteria set forth by the
Servicer (the "Assertion") and that, on the basis of such examination, such firm
is of the opinion that the Servicer's Assertion is fairly stated in all material
respects except for (i) such exceptions as such firm believes to be immaterial
and (ii) such other exceptions as shall be set forth in such firm's report, or
(B) such firm has performed the following procedures:
1. For a sample of daily cash receipts during the preceding
calendar year:
a. Trace total cash receipts to deposits on bank
statements.
b. Agree cash receipts for securitized loans to computer
reports.
c. Trace cash receipts for securitized loans to
disbursements to the Owner Trustee and the Indenture
Trustee.
2. For a sample of monthly cash receipt reports:
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a. Agree total cash receipts per the cash receipt reports to
"Total Payments From Obligors Applied to Collection Period"
per monthly Servicer Certificates.
b. Agree total principal payments per the cash receipt
reports to "Principal Payments" per monthly Servicer
Certificates.
3. For a sample of loans delinquent 30 days or more and for a sample of
loans in repossession status, selected from the loan delinquency report
or a new repossession report, as applicable, at a point in time, trace
loan number to inclusion in the loan collection system.
The determination of which of the two alternative reports to be prepared and
delivered, and the size of each sample to be tested, shall be decided in the
sole discretion of the Servicer. The report of the independent certified public
accountants shall also indicate that such accounting firm is independent of the
Servicer within the meaning of the Code of Professional Ethics of the American
Institute of Certified Public Accountants.
SECTION 4.11. Access by Holders to Certain Documentation and
Information Regarding Receivables. The Servicer shall provide to the Holders
access to the Receivable Files in such cases where the Holders shall be required
by applicable statutes or regulations to have access to such documentation.
Access by the Holders shall be afforded without charge, but only upon reasonable
request and during normal business hours which does not unreasonably interfere
with the Servicer's normal operations or customer or employee relations. Nothing
in this Section 4.11 shall affect the obligation of the Servicer to observe any
applicable law prohibiting disclosure of information regarding the Obligors, and
the failure of the Servicer to provide access to information as a result of such
obligation shall not constitute a breach of this Section 4.11.
SECTION 4.12. Reports to Holders and the Rating Agencies. (a)
The Indenture Trustee or the Owner Trustee, as applicable, shall provide to any
Holder who so requests in writing (addressed to the Corporate Trust Office of
such trustee) a copy of any Servicer's Certificate described in Section 4.8, of
the annual statement described in Section 4.9(a), or of the annual report
described in Section 4.10. The Indenture Trustee or the Owner Trustee, as
applicable, may require the Holder to pay a reasonable sum to cover the cost of
the Indenture Trustee's or the Owner Trustee's complying with such request, as
applicable.
(b) The Indenture Trustee or the Owner Trustee, as applicable,
shall forward to the Rating Agencies the statement to Holders described in
Section 5.8 and any other reports it may
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receive pursuant to this Agreement to (i) Standard & Poor's Ratings Services,
Asset-Backed Surveillance Group, 25 Broadway, New York, New York 10004, (ii)
Moody's Investors Service, ABS Monitoring Dept., 99 Church Street, 4th Floor,
New York, New York 10007 and (iii) to Fitch Investors Services, L.P., One State
Street Plaza, 32nd Floor, New York, New York 10004.
SECTION 4.13. Reports to the Securities and Exchange
Commission. The Servicer shall, on behalf of the Issuer, cause to be filed with
the Commission any periodic reports required to be filed under the provisions of
the Exchange Act and the rules and regulations of the Securities and Exchange
Commission thereunder.
ARTICLE V
ACCOUNTS; DISTRIBUTIONS;
STATEMENTS TO CERTIFICATEHOLDERS
SECTION 5.1. Establishment of Accounts. (a) The Servicer shall
establish and maintain:
(i) For the benefit of the Noteholders and the
Certificateholders, in the name of the Indenture Trustee, an
Eligible Deposit Account for the deposit of Collections (the
"Collection Account"), bearing a designation clearly
indicating that the funds deposited therein are held for the
benefit of the Noteholders and the Certificateholders.
(ii) For the benefit of the Noteholders, in the name
of the Indenture Trustee, an Eligible Deposit Account for the
deposit of distributions to the Noteholders (the "Note
Distribution Account"), bearing a designation clearly
indicating that the funds deposited therein are held for the
benefit of the Noteholders.
[(iii) For the benefit of the Noteholders and the
Certificateholders, in the name of the Indenture Trustee, an
Eligible Deposit Account for the deposit of Paid-Ahead Amounts
(the "Paid-Ahead Account") bearing a designation clearly
indicating that the funds deposited therein are held for the
benefit of the Noteholders [and the Certificateholders].
Each Account shall be an Eligible Deposit Account established
initially at Chase.
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(b) Should any depositary of an Account or of the Certificate
Distribution Account (including Chase (or an Affiliate thereof)) cease to be
either a Qualified Institution or a Qualified Trust Institution, as applicable,
then the Servicer shall, with the Seller's assistance as necessary, cause the
related Account to be moved to a Qualified Institution or a Qualified Trust
Institution, unless the Rating Agency Condition is satisfied in connection with
such depositary's ceasing to be a Qualified Institution or a Qualified Trust
Institution, as the case may be.
All amounts held in the Collection Account [and the Paid-Ahead
Account] shall be invested by the bank or trust company then maintaining the
account (at the written direction of the Servicer) in Permitted Investments that
mature not later than the Deposit Date next succeeding the date of investment
[(or, if the Class A-1 Event has occurred, not later than _____ __, ____, in the
case of investments made on or after the Deposit Date in __________ and prior to
the Deposit Date in __________, in an amount at least equal to the __________
Class A-1 Note Distribution)] except, if the Collection Account [or the Paid-
Ahead Account] is maintained with the Indenture Trustee for investments on which
the Indenture Trustee is the obligor (including repurchase agreements on which
the Indenture Trustee, in its commercial capacity, is liable as principal),
which investments may mature on the next succeeding Distribution Date; provided,
however, that once such amounts have been invested by such bank or trust
company, as applicable, in Permitted Investments, such Permitted Investments
must be held or maintained until they mature on or before the dates described
above. Amounts on deposit in the Note Distribution Account shall not be
invested.
(c) The Indenture Trustee shall possess all right, title and
interest in all funds on deposit from time to time in the Accounts and in all
proceeds thereof (excluding Investment Earnings) and all such funds,
investments, proceeds and income shall be part of the Owner Trust Estate. Except
as otherwise provided herein, the Accounts shall be under the sole dominion and
control of Indenture Trustee for the benefit of the Noteholders and the
Certificateholders, or the Noteholders, as the case may be.
SECTION 5.2. Collections. The Servicer shall remit daily
within forty-eight hours of receipt to the Collection Account all payments by or
on behalf of the Obligors on the Receivables and all Liquidation Proceeds, both
as collected during the Collection Period (other than Paid-Ahead Amounts). The
Servicer shall remit daily within forty-eight hours of receipt to the Paid-Ahead
Account all Paid-Ahead Amounts with respect to the Receivables collected during
the Collection
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Period. Chase USA has requested that, so long as it is acting as the Servicer,
the Servicer be permitted to make remittances of collections (including
Paid-Ahead Amounts) on a less frequent basis than that specified in the two
immediately preceding sentences. It is understood that such less frequent
remittances may be made only on the specific terms and conditions set forth
below in this Section 5.2 and only for so long as such terms and conditions are
fulfilled. Accordingly, notwithstanding the provisions of the first sentence of
this Section 5.2, the Servicer (i) shall remit such collections to the
Collection Account in Automated Clearinghouse Corporation next-day funds or
immediately available funds no later than 11:00 a.m., New York City time, on the
Deposit Date and (ii) may retain Paid-Ahead Amounts until any Applied Paid-Ahead
Amounts would otherwise be required to be withdrawn from the Paid-Ahead Account
and deposited in the Collection Account, and shall deposit such Applied
Paid-Ahead Amounts into the Collection Account in the manner described in the
preceding clause (i), but only for so long as the short-term certificate of
deposit ratings of the Servicer are at least P-1 by Moody's, "F-1" by Fitch (if
rated by Fitch) and "A-1" by Standard & Poor's, or the Rating Agency Condition
is satisfied as a result of Collections being remitted on a monthly, rather than
daily, basis and (y) the Servicer shall be Chase USA or Chase; [provided,
however, that if the Class A-1 Event has occurred, with respect to Collections
received during the __________ Collection Period, the Servicer shall remit to
the Collection Account on _____ __, ____ an amount of such Collections equal to
the __________ Class A-1 Note Distribution]. Upon remittance by the Servicer of
Collections to the Collection Account pursuant to the preceding sentence, the
Paying Agent shall provide written notice to the Indenture Trustee and the Owner
Trustee no later than 11 a.m., New York City time, on each Deposit Date [(or
_____ __, ____),] setting forth the amounts remitted by the Servicer on such
date and, if the Paying Agent fails to provide the Indenture Trustee and the
Owner Trustee, with such written notice by 12 noon, New York City time, on such
Deposit Date [(or _____ __, ____)], then the Indenture Trustee and the Owner
Trustee shall assume that no deposits were made to the Collection Account
pursuant to this Section 5.2. For purposes of this Section 5.2 the phrase
"payments made on behalf of the Obligors" shall mean payments made by Persons
other than the Seller or the Servicer.
Notwithstanding anything in this Agreement to the contrary, if
the Servicer inadvertently deposits amounts that it mistakenly believes are
Collections resulting in the payment in full of a Receivable, the Servicer shall
be deemed to have purchased such Receivable pursuant to Section 4.6 as of the
last day of the Collection Period during which such error shall have occurred.
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Deferred Paid-Ahead Amounts on Repurchased Receivables. With
respect to any Repurchased Receivable, the Servicer shall forward to the Seller
or Servicer purchasing such Receivable any Deferred Paid-Ahead Amounts with
respect to such Repurchased Receivable (by withdrawing such amounts from the
Paid-Ahead Account or otherwise).
SECTION 5.3. [Reserved].
SECTION 5.4. Additional Deposits. The Servicer, or the Seller,
as the case may be, shall deposit into the Collection Account the aggregate
Repurchase Amount pursuant to Sections 3.2, 4.6 and 9.1(a), as applicable. All
remittances shall be made to the Collection Account, in Automated Clearinghouse
Corporation next-day funds or immediately available funds, no later than 11
a.m., New York City time, on the Deposit Date[; provided, however, that if the
Class A-1 Event has occurred and the amount of Collections on the Receivables
received during the __________ Collection Period is less than the __________
Class A-1 Note Distribution, such remittances (up to the amount of such
shortfall) shall be deposited into the Collection Account no later than _____
__, ____].
SECTION 5.5. Distributions. (a) No later than 12 noon, New
York City time, on each Determination Date, the Servicer shall calculate all
amounts required to determine the amounts to be withdrawn from the Reserve
Account (if any) and deposited into the Collection Account and the amounts to be
withdrawn from the Collection Account and paid to the Servicer and the
Administrator, deposited into the Note Distribution Account [and the Certificate
Distribution Account] and paid to the Seller with respect to the next succeeding
Distribution Date.
(b) (i) On each Deposit Date, the Servicer shall instruct the
Indenture Trustee in writing (based on the information contained in the
Servicer's Certificate delivered on the related Determination Date pursuant to
Section 4.8) to withdraw from the Reserve Account and deposit in the Collection
Account the Reserve Account Transfer Amount (if any) for the related
Distribution Date, and the Indenture Trustee shall so withdraw and deposit the
Reserve Account Transfer Amount for such Distribution Date[; provided, however,
that if the Class A-1 Event has occurred and the Total Distribution Amount for
the __________ Distribution Date is less than the __________ Class A-1 Note
Distribution, the Servicer shall instruct the Indenture Trustee in writing to
withdraw from the Reserve Account and deposit in the Collection Account on
_________ __, ___ a portion of the Reserve Account Transfer Amount for the _____
____ Distribution Date equal to the lesser of such Reserve Account Transfer
Amount and the amount of such insufficiency as determined by the Servicer].
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(ii) On each Deposit Date, the Servicer shall instruct the
Indenture Trustee, or the Paying Agent on behalf of the Indenture Trustee, in
writing (based on the information contained in the Servicer's Certificate
delivered on the related Determination Date pursuant to Section 4.8) to withdraw
from the Paid-Ahead Account and deposit in the Collection Account any Applied
Paid-Ahead Amounts (if any) with respect to the related Collection Period, and
the Indenture Trustee or Paying Agent shall so withdraw and deposit the Applied
Paid-Ahead Amounts for such Distribution Date.
(c) Not later than 11:00 a.m., New York City time, on each
Distribution Date, at the Servicer's direction, the Indenture Trustee, or the
Paying Agent on behalf of the Indenture Trustee, shall cause to be made the
following distributions, to the extent of the Total Distribution Amount then on
deposit in the Collection Account and amounts withdrawn from the Reserve Account
and deposited in the Collection Account by wire transfer of immediately
available funds, in the following order of priority and in the amounts set forth
in the Servicer's Certificate for such Distribution Date:
(i) to the Servicer, the sum of (x) the Servicing
Fee for the preceding Collection Period, plus (y) the amount
of any Servicing Fee previously due but not paid, if any, to
the extent such amounts are not deducted from the Servicer's
remittance to the Collection Account pursuant to Section 5.7;
(ii) to the Administrator, the sum of (x) the
Administration Fee for such Distribution Date, plus (y) the
amount of any Administration Fee previously due but not paid,
if any;
(iii) to the Note Distribution Account, the [Class
A] Noteholders' Interest Distributable Amount;
[(iv) except as set forth in Section 5.5(d), to the
Note Distribution Account, the Class B Noteholders' Interest
Distributable Account;]
[(v) except as set forth in Section 5.5(d), to the
Owner Trustee for deposit in the Certificate Distribution
Account, the Certificateholders' Interest Distributable
Amount;]
(vi) except as set forth in Section 5.5(d), to the
Note Distribution Account, the Noteholders' Principal
Distributable Amount; and
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[(vii) except as set forth in Section 5.5(d), to the
Owner Trustee for deposit in the Certificate Distribution
Account, the Certificateholders' Principal Distributable
Amount; and]
[(viii) except as set forth in Section 5.5(d), to the
Reserve Account, any remaining portion of the Total
Distribution Amount].
In the event that the Collection Account is maintained with an
institution other than the Indenture Trustee, the Servicer shall instruct and
cause such institution to make all deposits and distributions pursuant to this
Section 5.5(c) on the related Deposit Date.
(d) If the Notes have been declared immediately due and
payable as provided in Section 5.2 of the Indenture, any amounts remaining in
the Collection Account after the distributions described in clauses (i), (ii)
and (iii) of Section 5.5(c) shall be distributed as follows: (1) an amount equal
to the Outstanding Amount of the [Class A] Notes will be deposited in the [Class
A] Note Distribution Account, and (2) any remaining amounts will be applied
pursuant to clauses (iv), (v), (vi) and (vii) [(iv), (v) (up to the Outstanding
Amount of Class B Notes), (vi), (vii), (viii) and (ix)] of Section 5.5(c).
[(e) Notwithstanding any of the foregoing to the contrary, if
the Class A-1 Event shall have occurred (x) the __________ Class A-1 Note
Distribution will be deposited in the Note Distribution Account on the
__________ Distribution Date with respect to Class A-1 Notes pursuant to clauses
(iii) and (v) of Section 5.5(c) and (y) the remainder of the Noteholders'
Distributable Amount will be withdrawn from the Collection Account, as
applicable, and applied on the __________ Distribution Date with respect to the
Class A-2 Notes, the Class A-3 Notes, the Class A-4 Notes, the Class [A-5][B]
Notes and the Certificates pursuant to clauses (i) through (vi), inclusive, of
Section 5.5(c); provided, however if the sum of the Total Distribution Amount
and the Reserve Account Transfer Amount for the __________ Distribution Date is
less than the sum of the amounts set forth in clauses (i) through (v) of Section
5.5(c), amounts shall be distributed from the Collection Account with respect to
the Class A-1 Notes only to the same extent that such amounts would have been
distributable therefrom if the __________ Distribution Date with respect to the
Class A-1 Notes were the same as that with respect to the Class A-2 Notes, the
Class A-3 Notes[,] [and] the Class A-4 Notes, the Class [A-5][B] Notes and the
Certificates.]
SECTION 5.6. Reserve Account. (a) The Seller shall establish
and maintain an Eligible Deposit Account (the "Reserve
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Account") at [__________________________________________] in the name of the
Indenture Trustee for the benefit of the Noteholders and the Certificateholders.
Pursuant to Section 2.5 of the Trust Agreement, on the Closing Date, the Owner
Trustee shall deposit the Reserve Account Initial Deposit into the Reserve
Account.
(b) Should any sole depositary of the Reserve Account cease to
be either a Qualified Institution or a Qualified Trust Institution, the Seller
shall cause the Reserve Account to be moved to a Qualified Institution or a
Qualified Trust Institution, as applicable, unless the Seller provides the
Indenture Trustee with a letter from the Rating Agencies to the effect that the
Rating Agency Condition will be satisfied in connection with such depositary's
ceasing to be a Qualified Institution or a Qualified Trust Institution, as the
case may be.
All amounts held in the Reserve Account shall be invested by
the bank or trust company then maintaining the account (at the written direction
of the Seller) in Permitted Investments that mature not later than the Deposit
Date next succeeding the date of investment (or, if the Class A-1 Event has
occurred, not later than _____________ to the extent of the __________ Class A-1
Note Distribution) except, if the Reserve Account is maintained with the
Indenture Trustee, for investments on which the Indenture Trustee is the obligor
(including repurchase agreements on which the Indenture Trustee in its
commercial capacity is liable as principal), which investments may mature on the
next succeeding Distribution Date; provided, however, that amounts on deposit in
the Reserve Account may be invested in Permitted Investments that mature later
than the next succeeding Deposit Date (or _______________ if the Class A-1 Event
has occurred) if the Rating Agency Condition is satisfied.
(c) With respect to the Reserve Account Property:
(i) any Reserve 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 by the Indenture Trustee, pending
maturity or disposition;
(ii) any Reserve Account Property that is a United
States Security Entitlement 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; and
(iii) any Reserve Account Property that is an
"uncertificated security" under Article 8 (or VIII as
applicable) of the Relevant UCC and that is not governed by
clause (ii) above shall be delivered to the
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Indenture Trustee in accordance with paragraph (c) of the
definition of "Delivery" and shall be maintained by the
Indenture Trustee, pending maturity or disposition.
The Indenture Trustee shall, at the expense of the Servicer, take such action as
is required to maintain the Indenture Trustee's security interest in any Reserve
Account Property; provided, however, that (x) the Indenture Trustee shall not be
required to prepare or file any financing statements or continuation statements
and (y) the Indenture Trustee may rely upon the written instructions of the
Servicer as to the method by which the security interest of the Indenture
Trustee may be perfected. Upon written request from the Indenture Trustee, the
Servicer shall provide such instructions and an opinion of counsel with respect
to the method of perfection of such security interest; provided, however, that
the Servicer shall not be obligated to deliver to the Indenture Trustee an
opinion of counsel with respect to the method of perfecting a security interest
in any Permitted Investment the method of perfecting an ownership interest in
which was described in that certain legal opinion of [___________________],
special local counsel to the Indenture Trustee, dated _____ __, ____, unless
there has been change in law or the interpretation thereof from the date of such
opinion with respect to the method of perfecting a security interest in such
Permitted Investment.
(d) On each Distribution Date, the Indenture Trustee shall
withdraw from the Reserve Account and pay to the Seller the excess, if any, of
the amount on deposit in the Reserve Account over the Specified Reserve Account
Balance with respect to such Distribution Date (after giving effect to all
deposits therein or withdrawals therefrom on such Distribution Date). Upon any
distribution to the Seller of amounts from the Reserve Account, the Holders will
have no rights in, or claims, to, such amounts. Amounts properly distributed to
the Seller from the Reserve Account shall not be available under any
circumstances to the Indenture Trustee, and the Seller shall not in any event
thereafter be required to refund any such distributed amounts. [For purposes of
this Section 5.6(d), the __________ Distribution Date shall be _____ __, ____
regardless of whether the Class A-1 Event has occurred.]
(e) The Indenture Trustee shall possess all right, title and
interest in all funds on deposit from time to time in the Reserve Account and in
all proceeds thereof and all such funds, investments, proceeds and income shall
be part of the Trust Estate. Except as otherwise provided herein, the Reserve
Account shall be under the sole dominion and control of the Indenture Trustee
for the benefit of the Noteholders and the Certificateholders.
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SECTION 5.7. Net Deposits. Chase USA (in its capacity as the
Seller or the Servicer) may make the remittances pursuant to Sections 5.2 and
5.4 above, net of amounts to be retained by it or distributed to it (also in any
such capacity) pursuant to Section 4.7 (if applicable) and Section 5.5, if (a)
it shall be the Servicer and (b) it is entitled, pursuant to Section 5.2, to
make deposits on a monthly basis, rather than a daily basis. Nonetheless, the
Servicer shall account for all of the above described amounts as if such amounts
were deposited and distributed separately.
SECTION 5.8. Statements to [Certificateholders and]
Noteholders. (a) On each Distribution Date, the Servicer shall provide to the
Indenture Trustee (for the Indenture Trustee to forward to each Noteholder of
record pursuant to the Indenture) [and to the Owner Trustee (for the Owner
Trustee to forward to each Certificateholder of record pursuant to the Trust
Agreement)] a statement substantially in the form of Exhibit B (or such other
form that is acceptable to the Indenture Trustee, the Owner Trustee and the
Servicer), with a copy to the Rating Agencies [and the Luxembourg Stock Exchange
(so long as any Notes are listed thereon)], setting forth at least the following
information as to the Notes (separately stating such information as to the Class
A-1 Notes, the Class A-2 Notes, the Class A-3 Notes, the Class A-4 Notes and the
Class [A-5][B] Notes) and the Certificates, to the extent applicable:
(i) the amount of such distribution allocable to
principal on each class of Notes [and the
Certificates];
(ii) the amount of such distribution allocable to
interest on each class of Notes [and the Certificates];
(iii) the amount of the Servicing Fee paid to the
Servicer pursuant to Section 5.5(c);
(iv) the amount of the Administration Fee paid to
the Administrator on such Distribution Date;
(v) the Outstanding Amount of each class of the
Notes, the Class A-1 Note Pool Factor, the Class A-2 Note Pool
Factor, the Class A-3 Note Pool Factor, the Class A-4 Note
Pool Factor[,] the Class [A-5][B] Note Pool Factor[,] the
Certificate Balance and the Certificate Pool Factor[,] in each
case after giving effect to payments allocated to principal
reported under (i) above;
(vi) the Pool Balance as of the last day of the
preceding Collection Period;
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(vii) the aggregate amount of the Repurchase Amounts
for Repurchased Receivables with respect to the related
Collection Period paid by each of the Seller and the Servicer
(accounted for separately);
(viii) the amount of Aggregate Net Losses, if any,
for such Distribution Date;
(ix) the balance of the Reserve Account on such
Distribution Date, after giving effect to deposits into and
withdrawals from the Reserve Account on such Distribution
Date;
(x) the balance of the Paid-Ahead Account as of
such date, after giving effect to any changes therein
on such date;
(x) [(xi)] the Specified Reserve Account Balance for
such Distribution Date;
(xi) [(xii)] the Total Distribution Amount for such
Distribution Date;
(xii) [(xiii)] the [Class A] Noteholders' Distributable Amount
[, the Class B Noteholders' Distributable Amount] and the
components thereof; [and]
[(xiii) [(xiv)] the Certificateholders' Distributable Amount
and the components thereof; and]
(xiv) [(xv)] [(xiii)] the Reserve Account Transfer Amount,
if any, for such Distribution Date.
Each amount set forth pursuant to subclause (i), (ii), (iii),
(iv), (xii) [or (xiii)] above shall be expressed as a dollar amount per $1,000
of original principal balance of a Note [or a Certificate, as applicable].
ARTICLE VI
THE SELLER
SECTION 6.1. Representations of Seller. The Seller makes the
following representations on which the Issuer shall rely in acquiring the
Receivables. The representations shall speak as of the execution and delivery of
this Agreement, and shall survive the sale of the Receivables to the Issuer and
pledge thereof to the Indenture Trustee pursuant to the Indenture.
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(i) Organization and Good Standing. The Seller has
been duly organized and is validly existing as a national
banking association in good standing under the laws of the
United States of America, with power and authority to own its
properties and to conduct its business as such properties are
currently owned and such business is presently conducted, and
had at all relevant times, and has, power, authority, and
legal right to acquire and own the Receivables.
(ii) Power and Authority. The Seller has the power
and authority to execute and deliver this Agreement and the
other Basic Documents to which it is a party 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 the Issuer as the Owner Trust Estate and has duly
authorized such sale and assignment to the Issuer by all
necessary corporate action; and the execution, delivery, and
performance of this Agreement and the other Basic Documents to
which it is a party has been duly authorized by the Seller by
all necessary action.
(iii) Valid Sale; Binding Obligations. This Agreement
effects a valid sale, transfer, and assignment of the
Receivables, enforceable against creditors of and purchasers
from the Seller; this Agreement and each of the other Basic
Documents to which it is a party constitutes a legal, valid,
and binding obligation of the Seller enforceable in accordance
with its terms, except as enforceability may be limited by
bankruptcy, insolvency, reorganization, or other similar laws
affecting the enforcement of creditors' rights in general and
by general principles of equity, regardless of whether such
enforceability is considered in a proceeding in equity or at
law.
(iv) No Violation. The consummation of the
transactions contemplated by this Agreement and the other
Basic Documents and the fulfillment of the terms hereof and
thereof do not conflict with, result in any breach of any of
the terms and provisions of, nor constitute (with or without
notice or lapse of time) a default under, the articles of
association or bylaws of the Seller, or conflict with or
breach any of the material terms or provisions of, or
constitute (with or without notice or lapse of time) a default
under, any indenture, agreement, or other instrument to which
the Seller is a party or by which it is bound; nor result in
the creation or imposition of any lien upon any of its
properties pursuant to the terms of any such
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indenture, agreement, or other instrument; nor violate any law
or, to the best of the Seller's knowledge, any order, rule, or
regulation applicable to the Seller of any court or of any
federal or state regulatory body, administrative agency, or
other governmental instrumentality having jurisdiction over
the Seller or its properties.
(v) No Proceedings. There are no proceedings or
investigations pending, or, to the Seller's best knowledge,
threatened, before any court, regulatory body, administrative
agency, or other governmental instrumentality having
jurisdiction over the Seller or its properties: (a) asserting
the invalidity of this Agreement, any other Basic Document[,]
the Notes [or the Certificates], (b) seeking to prevent the
issuance of the Notes [or the Certificates] or the
consummation of any of the transactions contemplated by this
Agreement or any other Basic Document, (c) seeking any
determination or ruling that might materially and adversely
affect the performance by the Seller of its obligations under,
or the validity or enforceability of, this Agreement, any
other Basic Document[,] [or] the Notes [or the Certificates],
or (d) relating to the Seller and which might adversely affect
the federal or state income tax attributes of the Notes [or
the Certificates].
SECTION 6.2. Liability of Seller; Indemnities. The Seller
shall be liable in accordance herewith only to the extent of the obligations
specifically undertaken by the Seller in such capacity under this Agreement and
shall have no other obligations or liabilities hereunder.
The Seller shall indemnify, defend and hold harmless the
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, and as
of the date of, the sale of the Receivables to the Issuer or the issuance and
original sale of the Notes [and the Certificates], including any sales, gross
receipts, general corporation, tangible or intangible personal property,
privilege, or license taxes (but not including any taxes asserted with respect
to ownership of the Receivables or federal or other income taxes, including
franchise taxes measured by net income), arising out of the transactions
contemplated by this Agreement and the other Basic Documents, and costs and
expenses in defending against the same.
The Seller shall indemnify, defend, and hold harmless the
Issuer, the Owner Trustee and the Indenture Trustee from and against any loss,
liability or expense incurred by reason of (i)
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the Seller's wilful misfeasance, bad faith, or gross negligence in the
performance of its duties hereunder, or by reason of reckless disregard of the
obligations and duties hereunder and (ii) the Seller's violation of federal or
state securities laws in connection with the registration of the sale of the
Notes [and the Certificates].
Indemnification under this Section 6.2 shall include
reasonable fees and expenses of counsel and expenses of litigation. If the
Seller shall have made any indemnity payments to the Issuer, the Owner Trustee
or the Indenture Trustee, respectively, pursuant to this Section 6.2 and the
Issuer, the Owner Trustee or the Indenture Trustee, respectively, thereafter
shall collect any of such amounts from others, the Issuer, the Owner Trustee or
the Indenture Trustee, respectively, shall repay such amounts to the Seller,
without interest.
SECTION 6.3. Merger or Consolidation of Seller. Any
corporation or other entity (i) into which the Seller may be merged or
consolidated, (ii) which may result from any merger, conversion, or
consolidation to which the Seller shall be a party, or (iii) which may succeed
to all or substantially all of the business of the Seller, which corporation or
other entity shall be bound to perform every obligation of the Seller under this
Agreement, shall be the successor to the Seller hereunder without the execution
or filing of any document or any further act by any of the parties to this
Agreement. The Seller shall give prompt written notice of any merger or
consolidation to the Issuer, the Owner Trustee, the Indenture Trustee, the
Servicer and the Rating Agencies.
SECTION 6.4. Limitation on Liability of Seller and Others. The
Seller and any director, officer, employee or agent of the Seller may rely in
good faith on the advice of counsel or on any document of any kind, prima facie
properly executed and submitted by any Person respecting any matters arising
hereunder or under any other Basic Documents. The Seller shall not be under any
obligation under this Agreement to appear in, prosecute, or defend any legal
action that shall be unrelated to its obligations under this Agreement or any
other Basic Document, and that in its opinion may involve it in any expense or
liability.
SECTION 6.5. Seller May Own Notes [and Certificates]. The
Seller or any of its Affiliates may in its individual or any other capacity
become the owner or pledgee of Notes [or Certificates] with the same rights as
it would have if it were not the Seller or an Affiliate thereof, except as
otherwise provided in the definition of "Outstanding" specified in Section 1.1.
Notes [or Certificates] so owned by or pledged to the Seller or any Affiliate
thereof shall have an equal and
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proportionate benefit under the provisions of this Agreement, without
preference, priority, or distinction as among all of the Notes [or Certificates,
as applicable].
ARTICLE VII
THE SERVICER
SECTION 7.1. Representations of Servicer. The Servicer makes
the following representations on which the Issuer shall rely in acquiring the
Receivables. The representations shall speak as of the execution and delivery of
this Agreement (or as of a date a Person (other than the Indenture Trustee)
becomes Servicer pursuant to Section 7.3 or Section 8.2), and shall survive the
sale of the Receivables to the Issuer and the pledge thereof to the Indenture
Trustee pursuant to the Indenture.
(i) Organization and Good Standing. The Servicer
has been duly organized and is validly existing as a national
banking association or corporation and is in good standing
under the laws of the United States of America or the
jurisdiction of its incorporation, with power and authority to
own its properties and to conduct its business as such
properties are currently owned and such business is presently
conducted, and had at all relevant times, and has, power,
authority, and legal right to acquire, own, sell, and service
the Receivables and to hold the Receivable Files as custodian
on behalf of the Issuer.
(ii) Power and Authority. The Servicer has the power
and authority to execute and deliver this Agreement and the
Basic Documents to which it is a party and to carry out the
terms thereof; and the execution, delivery, and performance of
this Agreement and the other Basic Documents has been duly
authorized by the Servicer by all necessary action.
(iii) Binding Obligations. This Agreement and the
other Basic Documents to which it is a party constitute legal,
valid, and binding obligations of the Servicer enforceable in
accordance with their respective terms subject, as to
enforcement, to applicable bankruptcy, insolvency,
reorganization, liquidation or other similar laws and
equitable principles relating to or affecting the enforcement
of creditors' rights, whether considered in a proceeding at
law or in equity.
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(iv) No Violation. The consummation of the
transactions contemplated by this Agreement and the other
Basic Documents and the fulfillment of the terms hereof and
thereof do not conflict with, result in any breach of any of
the terms and provisions of, nor constitute (with or without
notice or lapse of time) a default under, the articles of
association or bylaws of the Servicer, or conflict with or
breach any of the material terms or provisions of, or
constitute (with or without notice or lapse of time) a default
under, any indenture, agreement, or other instrument to which
the Servicer is a party or by which it is bound; nor result in
the creation or imposition of any lien upon any of its
properties pursuant to the terms of any such indenture,
agreement, or other instrument; nor violate any law or, to the
best of the Servicer's knowledge, any order, rule, or
regulation applicable to the Servicer of any court or of any
federal or state regulatory body, administrative agency, or
other governmental instrumentality having jurisdiction over
the Servicer or its properties.
(v) No Proceedings. There are no proceedings or
investigations pending, or to the Servicer's best knowledge,
threatened, before any court, regulatory body, administrative
agency, or other governmental instrumentality having
jurisdiction over the Servicer or its properties: (a)
asserting the invalidity of this Agreement[,] [or] the Notes
[or the Certificates], (b) seeking to prevent the issuance of
the Notes [or the Certificates] or the consummation of any of
the transactions contemplated by this Agreement or any other
Basic Document, (c) seeking any determination or ruling that
might materially and adversely affect the performance by the
Servicer of its obligations under, or the validity or
enforceability of, this Agreement, any other Basic Document[,]
[or] the Notes [or the Certificates], or (d) relating to the
Servicer and which might adversely affect the federal or state
income tax attributes of the Notes [or the Certificates].
(vi) Fidelity Bond. The Servicer maintains a
fidelity bond in such form and amount as is customary for
banks acting as custodian of funds and documents in respect of
retail automotive installment sales contracts.
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SECTION 7.2. Liability of Servicer; Indemnities. The Servicer
shall be liable in accordance herewith only to the extent of the obligations
specifically undertaken by the Servicer under this Agreement and shall have no
other obligations or liabilities hereunder.
(i) The Servicer shall defend, indemnify, and hold
harmless the Issuer, the Owner Trustee, the Indenture Trustee
and the Holders from and against any and all costs, expenses,
losses, damages, claims, and liabilities, arising out of or
resulting from the use, ownership, or operation by the
Servicer or any Affiliate thereof of a Financed Vehicle.
(ii) The Servicer shall indemnify, defend, and hold
harmless the Issuer, the Owner Trustee and the Indenture
Trustee from and against any taxes that may at any time be
asserted against the Issuer with respect to the transactions
contemplated in this Agreement, including, without limitation,
any sales, gross receipts, general corporation, tangible or
intangible personal property, privilege, or license taxes (but
not including any taxes asserted with respect to, and as of
the date of, the sale of the Receivables to the Issuer or the
issuance and original sale of the Notes [or the Certificates],
or asserted with respect to ownership of the Receivables or
federal, state or other income taxes, including franchise
taxes measured by net income) arising out of distributions on
the Notes [or the Certificates] and costs and expenses in
defending against the same.
(iii) The Servicer shall indemnify, defend, and hold
harmless the Issuer, the Owner Trustee, the Indenture Trustee
and the Holders from and against any and all costs, expenses,
losses, claims, damages, and liabilities to the extent that
such cost, expense, loss, claim, damage, or liability arose
out of, or was imposed upon the Issuer, the Owner Trustee, the
Indenture Trustee or the Holders through the wilful
misfeasance, gross negligence, or bad faith of the Servicer in
the performance of its duties under this Agreement or by
reason of reckless disregard of its obligations and duties
under this Agreement.
Indemnification under this Section 7.2 shall include
reasonable fees and expenses of counsel and expenses of litigation. If the
Servicer shall have made any indemnity payments pursuant to this Section 7.2 and
the recipient thereafter collects any of such amounts from others, the recipient
shall promptly repay such amounts to the Servicer,
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without interest. The indemnification obligations of the Servicer set forth in
this Section 7.2 shall survive the termination of such Servicer with respect to
any act or failure to act which occurs prior to such Servicer's termination. The
provisions of Section 6.7 of the Indenture and Sections 8.1 and 8.2 of the Trust
Agreement with respect to the Servicer's obligations are incorporated by
reference herein.
SECTION 7.3. Merger or Consolidation of Servicer. Any
corporation or other entity (i) into which the Servicer may be merged or
consolidated, (ii) which may result from any merger, conversion, or
consolidation to which the Servicer shall be a party, or (iii) which may succeed
to all or substantially all of the business of the Servicer, which corporation
or other entity shall be bound to perform every obligation of the Servicer
hereunder, shall be the successor to the Servicer under this Agreement without
the execution or filing of any document or any further act on the part of any of
the parties to this Agreement. The Servicer shall promptly inform the Issuer,
the Owner Trustee, the Indenture Trustee, the Seller and the Rating Agencies in
writing of any such merger or consolidation.
SECTION 7.4. Limitation on Liability of Servicer and Others.
(a) Neither the Servicer nor any of the directors or officers
or employees or agents of the Servicer shall be under any liability to the
Issuer, the Owner Trustee, the Indenture Trustee or the Holders, except as
provided under this Agreement, for any action taken or for refraining from the
taking of any action pursuant to this Agreement; provided, however, that this
provision shall not protect the Servicer or any such person against any
liability that would otherwise be imposed by reason of wilful misfeasance, gross
negligence, or bad faith in the performance of duties or by reason of reckless
disregard of obligations and duties under this Agreement. The Servicer and any
director or officer or employee or agent of the Servicer may rely in good faith
on the advice of counsel or on any document of any kind prima facie properly
executed and submitted by any Person respecting any matters arising under this
Agreement.
(b) The Servicer, and any director, or officer, employee or
agent of the Servicer, shall be indemnified by the Issuer and held harmless
against any loss, liability, or expense (including reasonable attorneys' fees
and expenses) incurred in connection with any legal action relating to the
performance of the Servicer's duties under this Agreement, other than (i) any
loss or liability otherwise reimbursable pursuant to this Agreement or the Basic
Documents; (ii) any loss, liability, or expense incurred solely by reason of the
Servicer's wilful misfeasance, negligence, or bad faith in the performance of
its
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duties hereunder or by reason of reckless disregard of its obligations and
duties under this Agreement or the Basic Documents; and (iii) any loss,
liability, or expense for which the Issuer is to be indemnified by the Servicer
under this Agreement or the Basic Documents. Any amounts due the Servicer
pursuant to this Section 7.4 shall be payable on a Distribution Date from
amounts distributable to the Seller from the Reserve Account pursuant to Section
5.6(d).
(c) Except as provided in this Agreement, the Servicer shall
not be under any obligation to appear in, prosecute, or defend any legal action
that shall not be incidental to its obligations under this Agreement, and that
in its opinion may involve it in any expense or liability; provided, however,
that the Servicer may undertake any reasonable action that it may deem necessary
or desirable in respect of this Agreement and the rights and duties of the
parties to this Agreement and the interests of the Holders under this Agreement.
In such event, the legal expenses and costs of such action and any liability
resulting therefrom shall be expenses, costs, and liabilities of the Issuer, and
the Servicer shall be entitled to be reimbursed therefor. Any amounts due the
Servicer pursuant to this Section 7.4 shall be payable on a Distribution Date
from amounts distributable to the Seller from the Reserve Account pursuant to
Section 5.6(d).
The Person to be indemnified shall provide the Issuer, the
Owner Trustee and the Indenture Trustee with a certificate and accompanying
Opinion of Counsel requesting indemnification and setting forth the basis for
such request.
SECTION 7.5. Servicer Not To Resign. Except as permitted by
Section 7.3, the Servicer shall not resign from its obligations and duties under
this Agreement except (i) upon determination that the performance of its duties
shall no longer be permissible under applicable law or (ii) in the event of the
appointment of a successor Servicer, upon satisfaction of the Rating Agency
Condition. Notice of any such determination permitting the resignation of the
Servicer shall be communicated to the Issuer, the Indenture Trustee, the Owner
Trustee and the Rating Agencies at the earliest practicable time (and, if such
communication is not in writing, shall be confirmed in writing at the earliest
practicable time) and any such determination permitting the resignation of the
Servicer shall be evidenced by an Opinion of Counsel to such effect delivered to
the Issuer, the Indenture Trustee and the Owner Trustee concurrently with such
notice. No such resignation shall become effective until the Indenture Trustee
(which shall not be obligated to act as successor Servicer if the Servicer has
resigned for a reason other than that the performance of its duties are no
longer permissible under applicable law) or a successor Servicer shall
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have assumed the responsibilities and obligations of the Servicer hereunder in
accordance with Section 8.2.
SECTION 7.6. Delegation of Duties. So long as Chase USA acts
as Servicer, the Servicer shall have the right, in the ordinary course of its
business, to delegate any of its duties under this Agreement to any Person. Any
compensation payable to such Person shall be paid by the Servicer from its own
funds and none of the Issuer, the Owner Trustee, the Indenture Trustee or the
Holders shall have any liability to such Person with respect thereto.
Notwithstanding any delegation of duties by the Servicer pursuant to this
Section 7.6, the Servicer shall not be relieved of its liability and
responsibility with respect to such duties, and any such delegation shall not
constitute a resignation within the meaning of Section 7.5. Any agreement that
may be entered into by the Servicer and a Person that provides for any
delegation of the Servicer's duties hereunder to such Person shall be deemed to
be between the Servicer and such Person alone, and the Issuer, the Owner
Trustee, the Indenture Trustee and Holders shall not be deemed parties thereto
and shall have no claims, rights, obligations, duties or liabilities with
respect thereto.
ARTICLE VIII
EVENTS OF SERVICING TERMINATION
SECTION 8.1. Events of Servicing Termination. Any one of the
following events which shall occur and be continuing shall constitute an event
of servicing termination hereunder (each, an "Event of Servicing Termination"):
(i) Any failure by the Servicer to deliver to the
Indenture Trustee the Servicer's Certificate for the related
Collection Period, or any failure by the Servicer to deliver
to the Indenture Trustee, for deposit in any of the Trust
Accounts [or the Certificate Distribution Account,] any
proceeds or payment required to be so delivered under the
terms of the Certificates or the Notes and this Agreement (or,
in the case of a payment or deposit to be made not later than
the Deposit Date, the failure to make such payment or deposit
on such Deposit Date), which failure continues unremedied for
a period of five Business Days after (A) discovery by an
officer of the Servicer or (B) written notice (1) to the
Servicer by the Indenture Trustee or the Owner Trustee or (2)
to the Indenture Trustee or the Owner Trustee, as applicable,
and the Servicer by the Holders of Notes evidencing not less
than 25% of the Outstanding Amount of the Notes [(or,
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if the Notes have been paid in full, by Holders of the
Certificates evidencing not less than 25% of the
Certificate Balance)];
(ii) Failure on the part of the Servicer duly to
observe or to perform in any material respect any other
covenants or agreements of the Servicer set forth in this
Agreement or the Indenture, which failure shall (a) materially
and adversely affect the rights of the Issuer or the Holders,
and (b) 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 (1) to the Servicer
by the Indenture Trustee or the Owner Trustee, or (2) to the
Indenture Trustee or the Owner Trustee, as applicable, and the
Servicer by the Holders of Notes evidencing not less than 25%
of the Outstanding Amount of the Notes [(or, if the Notes have
been paid in full, by Holders of the Certificates evidencing
not less than 25% of the Certificate Balance)];
(iii) The entry of a decree or order by a court or
agency or supervisory authority having jurisdiction in the
premises for the appointment of a conservator, receiver, or
liquidator for the Servicer in any insolvency, readjustment of
debt, marshalling of assets and liabilities, or similar
proceedings, or for the winding up or liquidation of its
affairs, and the continuance of any such decree or order
unstayed and in effect for a period of 60 consecutive days; or
(iv) The consent by the Servicer to the appointment
of a conservator or receiver or liquidator in any insolvency,
readjustment of debt, marshalling of assets and liabilities,
or similar proceedings of or relating to the Servicer or of or
relating to substantially all of its property; or the Servicer
shall admit in writing its inability to pay its debts
generally as they become due, file a petition to take
advantage of any applicable insolvency or reorganization
statute, make an assignment for the benefit of its creditors,
or voluntarily suspend payment of its obligations.
Upon the occurrence of any Event of Servicing Termination as described above,
and in each and every case and for so long as such Event of Servicing
Termination shall not have been remedied, either the Indenture Trustee or the
Holders of Notes evidencing not less than a majority of the Outstanding Amount
of the Notes [(or, if the Notes have been paid in full and the Indenture has
been discharged in accordance with its terms, by the Owner
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Trustee or the Holders of Certificates evidencing not less than a majority of
the Certificate Balance)], by notice given in writing to the Servicer (and to
the Indenture Trustee or the Owner Trustee, as applicable, if given by Holders)
may terminate all of the rights and obligations of the Servicer under this
Agreement. On or after the receipt by the Servicer of such written notice, all
authority and power of the Servicer under this Agreement, whether with respect
to the Certificates, the Notes or the Receivables or otherwise, shall pass to
and be vested in the Indenture Trustee pursuant to this Section 8.1; and,
without limitation, the Indenture Trustee shall be hereby authorized and
empowered to execute and deliver, on behalf of the predecessor Servicer, as
attorney-in-fact or otherwise, any and all documents and other instruments, and
to do or accomplish all other acts or things necessary or appropriate to effect
the purposes of such notice of termination, whether to complete the transfer and
endorsement of the Receivable Files, or otherwise. The predecessor Servicer
shall cooperate with the successor Servicer and the Indenture Trustee in
effecting the termination of the responsibilities and rights of the predecessor
Servicer under this Agreement, including the transfer to the successor Servicer
for administration by it of all cash amounts that shall at the time be held by
the predecessor Servicer for deposit, shall have been deposited by the
predecessor Servicer in the Collection Account, or shall thereafter be received
with respect to a Receivable. All reasonable costs and expenses (including
attorneys' fees and disbursements) incurred in connection with transferring the
Receivable Files to the successor Servicer and amending this Agreement to
reflect such succession as Servicer pursuant to this Section 8.1 shall be paid
by the predecessor Servicer upon presentation of reasonable documentation of
such costs and expenses. The Indenture Trustee and the Owner Trustee shall give
written notice of any termination of the Servicer to their related Holders, and
the Indenture Trustee shall give such notice to the Rating Agencies. Neither the
Indenture Trustee nor any successor Servicer shall be deemed to be in default
hereunder by reason of its failure to make, or any delay in making, any
distribution hereunder or any portion thereof which was caused by (i) the
failure of the predecessor Servicer to deliver, or any delay in delivering cash,
documents or records to it, or (ii) restrictions imposed by any regulatory
authority having jurisdiction over the predecessor Servicer.
SECTION 8.2. Indenture Trustee to Act; Appointment of
Successor. Upon the Servicer's receipt of notice of termination pursuant to
Section 8.1 or resignation pursuant to Section 7.5, the Indenture Trustee shall
be the successor in all respects to the Servicer in its capacity as Servicer
under this Agreement, and shall be subject to all the responsibilities, duties
and liabilities arising thereafter relating thereto placed on the Servicer by
the terms and provisions of this Agreement. As
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compensation therefor, the Indenture Trustee shall be entitled to such
compensation (whether payable out of the Collection Account or otherwise) as the
Servicer would have been entitled to under this Agreement if no such notice of
termination or resignation had been given. Notwithstanding the above, the
Indenture Trustee may, if it shall be unwilling so to act, or shall, if it shall
be legally unable so to act, appoint, or petition a court of competent
jurisdiction to appoint, any established financial institution (x) having a net
worth of not less than $100,000,000 as of the last day of the most recent fiscal
quarter for such institution and (y) whose regular business shall include the
servicing of automobile receivables, as successor Servicer under this Agreement;
provided, that the appointment of any such successor Servicer is required to
satisfy the Rating Agency Condition. In connection with such appointment, the
Indenture Trustee may make such arrangements for the compensation of such
successor Servicer out of payments on Receivables as it and such successor
Servicer shall agree; provided, however, that no such compensation shall be in
excess of that permitted the Servicer under this Agreement. The Indenture
Trustee and such successor Servicer shall take such action, consistent with this
Agreement, as shall be necessary to effectuate any such succession. Unless the
Indenture Trustee shall be prohibited by law from so acting, the Indenture
Trustee shall not be relieved of its duties as successor Servicer under this
Section 8.2 until the newly appointed successor Servicer shall have assumed the
responsibilities and obligations of the Servicer under this Agreement.
SECTION 8.3. Notification to Noteholders [and
Certificateholders]. Upon any Event of Servicing Termination, or appointment of
a successor Servicer pursuant to this Article VIII, the Owner Trustee shall give
prompt written notice thereof to Certificateholders and the Indenture Trustee
shall give prompt written notice thereof to the Noteholders, at their respective
addresses of record, and to the Rating Agencies.
SECTION 8.4. Waiver of Past Defaults. The Holders of Notes
evidencing at least a majority of the Outstanding Amount of the Notes [(or, the
Holders of Certificates evidencing not less than a majority of the Certificate
Balance, in the case of any Event of Servicing Termination that does not
adversely affect the Indenture Trustee or the Noteholders)] may, on behalf of
all such Holders, waive any default by the Servicer in the performance of its
obligations hereunder and its consequences, except a default in the failure to
make any required deposits to or payments from any of the Trust Accounts [or the
Certificate Distribution Account] in accordance with this Agreement. Upon any
such waiver of a past default, such default shall cease to exist, and any Event
of Servicing Termination arising therefrom shall be deemed to have been remedied
for every purpose of this Agreement. No
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such waiver shall extend to any subsequent or other default or impair any right
consequent thereon except to the extent expressly so waived. The Servicer shall
give prompt written notice of any waiver to the Rating Agencies; provided,
however, that the Indenture Trustee or the Owner Trustee shall only be required
to give such notice if a Responsible Officer thereof has actual knowledge of the
related event.
ARTICLE IX
TERMINATION
SECTION 9.1. Optional Purchase of All Receivables; Trust
Termination. (a) As of the last day of any Collection Period as of which the
Pool Balance shall be equal to or less than the Optional Purchase Percentage of
the Original Pool Balance, the Servicer shall have the option to purchase the
Owner Trust Estate, other than the Trust Accounts and the Certificate
Distribution Account. To exercise such option, the Servicer shall notify the
Indenture Trustee, the Owner Trustee[,] [and] the Note Registrar [and the
Certificate Registrar] in writing, no later than the 25th day of the Collection
Period following which purchase is to be effected, shall pay the aggregate
Repurchase Amount for the Receivables (including Defaulted Receivables) and
shall succeed to all interests in, to and under such property. The payment shall
be made in the manner specified in Section 5.4, and shall be distributed
pursuant to Section 5.5. The Indenture Trustee shall not permit the purchase of
the Owner Trust Estate pursuant to this Section 9.1 unless (i) the Servicer's
long-term unsecured debt is rated at the time of such purchase at least "BBB-"
by Standard & Poor's and Fitch (if rated by Fitch) and Baa3 by Moody's or (ii)
the Servicer provides to the Indenture Trustee an Opinion of Counsel in form and
substance satisfactory to the Rating Agencies to the effect that such purchase
will not constitute a fraudulent transfer under applicable state and federal
law.
(b) Upon any sale of the assets of the Issuer pursuant to
Article V of the Indenture, the Servicer shall instruct the Indenture Trustee in
writing to deposit the proceeds from such sale after all payments and reserves
therefrom (including the expenses of such sale) have been made (the "Sale
Proceeds") in the Collection Account. On the Distribution Date on which the Sale
Proceeds are deposited in the Collection Account (or, if such proceeds are not
so deposited on a Distribution Date, on the Distribution Date immediately
following such deposit), the Servicer shall instruct the Indenture Trustee in
writing to make, and the Indenture Trustee shall make, the following deposits
and distributions (after the application on such Distribution Date of the Total
Distribution Amount pursuant to Section 5.5) from the
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Sale Proceeds and any funds remaining on deposit in the Reserve Account
(including the proceeds of any sale of investments therein):
(i) to the Note Distribution Account, any portion
of the [Class A] Noteholders' Interest Distributable Amount
not otherwise deposited into the Note Distribution Account on
such Distribution Date;
(ii) to the Note Distribution Account, the
Outstanding Amount of the [Class A] Notes (after giving effect
to the reduction in the Outstanding Amount of the [Class A]
Notes resulting from the deposits made in the Note
Distribution Account on such Distribution Date);
[(iii) to the Note Distribution Account, any portion
of the Class B Noteholders' Interest Distributable Amount not
otherwise deposited into the Note Distribution Account on such
Distribution Date;]
[(iv) to the Distribution Account, the Outstanding
Amount of the Class B Notes (after giving effect to the
reduction in the Outstanding Amount of the Class B Notes
resulting from the deposits made in the Note Distribution
Account on such Distribution Date);]
(iii)[(v)] to the Certificate Distribution Account, any
portion of the Certificateholders' Interest Distributable
Amount not otherwise deposited into the Certificate
Distribution Account on such Distribution Date; and
(iv)([vi]) to the Certificate Distribution Account, the
Certificate Balance and any Certificateholders' Principal
Carryover Shortfall (after giving effect to the reduction in
the Certificate Balance resulting from the deposits made in
the Certificate Distribution Account on such Distribution
Date).
Any Sale Proceeds remaining after the deposits described above shall be paid to
the Seller.
(c) Notice of any termination of the Issuer shall be given by
the Servicer to the Owner Trustee, the Indenture Trustee and the Rating Agencies
as soon as practicable after the Servicer has received notice thereof.
(d) Following the satisfaction and discharge of the
Indenture and the payment in full of the principal of and
interest on the Notes, the Certificateholders will succeed to the
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rights of the Noteholders hereunder and the Owner Trustee will succeed to the
rights of, and assume the obligations of, the Indenture Trustee pursuant to this
Agreement.
(e) After the payment to the Indenture Trustee, the Owner
Trustee, the Holders and the Servicer of all amounts required to be paid under
this Agreement, the Indenture and the Trust Agreement, any amounts on deposit in
the Reserve Account or the Collection Account shall be paid to the Seller, and
any other assets remaining in the Owner Trust Estate shall be distributed to the
Seller.
ARTICLE X
MISCELLANEOUS PROVISIONS
SECTION 10.1. Amendment. This Agreement may be amended by the
Seller, the Servicer and the Owner Trustee, with the prior consent of the
Indenture Trustee and prior notice to the Rating Agencies but without prior
notice to or the consent of any of the Holders, (i) to cure any ambiguity, to
correct or supplement any provisions in this Agreement which may be inconsistent
with any other provisions herein, to evidence a succession to the Servicer or
the Seller pursuant to this Agreement or to add any other provisions with
respect to matters or questions arising under this Agreement that shall not be
inconsistent with the provisions of this Agreement; provided, however, that such
action shall not, as evidenced by an Officer's Certificate and/or an Opinion of
Counsel delivered to the Owner Trustee and the Indenture Trustee, adversely and
materially affect the interests of the Issuer or any of the Holders; provided,
further, that the Servicer shall deliver written notice of such changes to each
Rating Agency prior to the execution of any such amendment, or (ii) to effect a
transfer or assignment in compliance with Section 10.6(a) of this Agreement.
Notwithstanding the foregoing, no amendment modifying the provisions of Section
5.5 shall become effective without satisfaction of the Rating Agency Condition.
This Agreement may also be amended from time to time by the
Seller, the Servicer and the Owner Trustee, with the consent of the Indenture
Trustee, the Holders of Certificates evidencing at least a majority of the
Certificate Balance of the Certificates and the consent of the Holders of Notes
evidencing at least a majority of the Outstanding Amount of the Notes, 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 (including effecting a transfer or
assignment in compliance with Section 10.6(a) of this Agreement); provided,
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however, that no such amendment, except with the consent of the Holders of all
Certificates or Notes, as applicable, then outstanding, shall (a) increase or
reduce in any manner the amount of, or accelerate or delay the timing of,
collections of payments of Receivables, or distributions that shall be required
to be made on any Certificate or Note, or (b) reduce the aforesaid percentage of
the Certificate Balance of the Certificates or the Outstanding Amount of the
Notes required to consent to any such amendment.
Promptly after the execution of any amendment or consent
referred to in this Section 10.1, the Owner Trustee shall furnish a copy of such
amendment or consent to the Indenture Trustee and each Noteholder and
Certificateholder and to the Rating Agencies.
It shall not be necessary for the consent of the Indenture
Trustee, the Certificateholders or the Noteholders pursuant to this Section 10.1
to approve the particular form of any proposed amendment or consent, but it
shall be sufficient if such consent shall approve the substance thereof. The
manner of obtaining such consents and of evidencing the authorization of the
execution thereof by Certificateholders or Noteholders shall be subject to such
reasonable requirements as the Indenture Trustee or the Owner Trustee may
prescribe.
Prior to the execution of any amendment to this Agreement, the
Indenture Trustee and 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 Indenture Trustee and the Owner
Trustee shall not be obligated to enter into any such amendment which affects
the Indenture Trustee's and the Owner Trustee's own rights, duties or immunities
under this Agreement.
Satisfaction of the Rating Agency Condition is required prior
to the execution of any amendment to this Agreement, other than an amendment
permitted pursuant to clause (i) of the first paragraph of this Section 10.1.
SECTION 10.2. Protection of Title to Owner Trust Estate.
(a) The Seller shall execute and file such financing
statements and cause to be executed and filed such continuation statements, all
in such manner and in such places as may be required by law fully to preserve,
maintain, and protect the interests of the Issuer and the Indenture Trustee in
the Receivables and in the proceeds thereof. The Servicer shall deliver (or
cause to be delivered) to the Owner Trustee and the Indenture Trustee
file-stamped copies of, or filing receipts for,
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any document filed as provided above, as soon as available following such
filing.
(b) Neither the Seller nor the Servicer shall change its name,
identity, or corporate structure in any manner that would, could, or might make
any financing statement or continuation statement filed by the Seller in
accordance with paragraph (a) above seriously misleading within the meaning of
ss. 9-402(7) (or any comparable section) of the Relevant UCC, unless it shall
have given the Owner Trustee and the Indenture Trustee at least 30 days prior
written notice thereof.
(c) The Seller and the Servicer shall 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 Relevant UCC would require the filing of any
amendment of any previously filed financing or continuation statement or of any
new financing statement. The Servicer shall at all times maintain each office
from which it shall service Receivables, and its principal executive office,
within the United States of America.
(d) The Servicer shall maintain accounts and records as to
each Receivable accurately and in sufficient detail to permit (i) the reader
thereof to know at any time the status of such Receivable, including payments
and recoveries made and payments owing (and the nature of each) and (ii)
reconciliation between payments or recoveries on (or with respect to) each
Receivable and the amounts from time to time deposited in the Collection Account
in respect of such Receivable.
(e) The Servicer shall maintain its computer systems so that,
from and after the time of sale under this Agreement of the Receivables to the
Issuer, the Servicer's master computer records (including archives) that shall
refer to a Receivable indicate clearly, by numerical code or otherwise, that
such Receivable is owned by the Issuer and has been pledged to the Indenture
Trustee. Indication of the Issuer's and Indenture Trustee's interest in a
Receivable shall be deleted from or modified on the Servicer's computer systems
when, and only when, the Receivable shall have been paid in full, repurchased or
assigned pursuant hereto.
(f) If at any time the Seller or the Servicer shall propose to
sell, grant a security interest in, or otherwise transfer any interest in a new
or used automobile receivable to any prospective purchaser, creditor, or other
transferee, the Seller or the Servicer, as the case may be, shall give to such
prospective purchaser, creditor, or other transferee computer tapes, records, or
print-outs (including any restored from
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archives) that, if they shall refer in any manner whatsoever to any Receivable,
shall indicate clearly that such Receivable has been sold and is owned by the
Issuer and has been pledged to the Indenture Trustee.
(g) The Servicer shall permit the Indenture Trustee and the
Owner Trustee and their respective agents upon reasonable notice at any time
during normal business hours which does not unreasonably interfere with the
Servicer's normal operations or customer or employee relations to inspect,
audit, and make copies of and abstracts from the Servicer's records regarding
the Receivables.
(h) Upon request, the Servicer shall furnish to the Owner
Trustee or the Indenture Trustee, within five Business Days, a list of all
Receivables by contract number and name of Obligor then held by the Issuer,
together with a reconciliation of such list to the Schedule of Receivables
attached as Schedule A to this Agreement and to each of the Servicer
Certificates indicating removal of Receivables from the Owner Trust Estate.
(i) The Servicer shall deliver to the Owner Trustee
and the Indenture Trustee:
(i) upon the execution and delivery of this
Agreement, an Opinion of Counsel either (a) stating that, in
the opinion of such counsel, all financing statements and
continuation statements have been executed and filed that are
necessary fully to preserve and protect the interest of the
Issuer 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)
stating that, in the opinion of such counsel, no such action
shall be necessary to preserve and protect such interest; and
(ii) on or before March 31 of each year, commencing
with March 31, ____, an Opinion of Counsel, dated as of such
date, either (a) stating that, in the opinion of such counsel,
all financing statements and continuation statements have been
executed and filed that are necessary fully to preserve and
protect the interest of the Issuer 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) stating that, in the opinion of such
counsel, no such action shall be necessary to preserve and
protect such interest. Notwithstanding the provisions of
Section 10.4, such Opinion of Counsel may be sent by regular
non-certified mail, and such
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mailed opinion shall be deemed delivered when so mailed.
(j) The Seller shall, to the extent required by applicable
law, cause the Certificates and the Notes to be registered with the Securities
and Exchange Commission pursuant to Section 12(b) or Section 12(g) of the
Exchange Act within the time periods specified in such sections.
(k) For the purpose of facilitating the execution of this
Agreement and for other purposes, this Agreement may be executed simultaneously
in any number of counterparts, each of which counterparts shall be deemed to be
an original, and all of which counterparts shall constitute but one and the same
instrument.
SECTION 10.3. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED
BY, AND INTERPRETED AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF
NEW YORK.
SECTION 10.4. Notices. All demands, notices, and
communications under this Agreement shall be in writing, personally delivered or
mailed by certified mail, return receipt requested, and shall be deemed to have
been duly given upon receipt (a) in the case of the Seller, c/o Chase Automotive
Finance Corporation, 900 Stewart Avenue, Garden City, New York 11530 Attention:
Financial Controller, or at such other address as shall be designated by the
Seller in a written notice to the Indenture Trustee, (b) in the case of the
Servicer, c/o Chase Manhattan Automotive Finance Corporation, 900 Stewart,
Garden City, New York 11530, Attention: Financial Controller, or at such other
address as shall be designated by the Servicer in a written notice to the
Indenture Trustee, (c) in the case of the Indenture Trustee, at
_________________________________________________, Attention:
______________________, [and] (d) in the case of the Issuer and the Owner
Trustee, at c/o __________________________
________________________________________________________________, Attention:
Corporate Trust Administration [and (e) in the case of the Luxembourg Stock
Exchange, c/o Banque Generale du Luxembourg, S.A., 50 Avenue J.F. Kennedy,
6-2951, Luxembourg]. Any notice required or permitted to be mailed to a Holder
shall be given by first class mail, postage prepaid, at the address of record of
such Holder. Any notice to a Holder so mailed within the time prescribed in this
Agreement shall be conclusively presumed to have been duly given, whether or not
the Holder shall receive such notice.
SECTION 10.5. Severability of Provisions. If any one or more
of the covenants, agreements, provisions, or terms of this Agreement shall be
for any reason whatsoever held invalid, then such covenants, agreements,
provisions, or terms shall be
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deemed severable from the remaining covenants, agreements, provisions, or terms
of this Agreement and shall in no way affect the validity or enforceability of
the other provisions of this Agreement or of the Certificates or of the Notes or
the rights of the Holders thereof.
SECTION 10.6. Assignment. Notwithstanding anything to the
contrary contained herein, except as provided in Sections 6.3, 7.3, 7.5 and 8.2,
neither the Seller nor the Servicer may assign all, or a portion of, its rights,
obligations and duties under this Agreement unless such transfer or assignment
satisfies the Rating Agency Condition. In the event of a transfer or assignment
pursuant to this Section 10.6, the Rating Agencies shall be provided with notice
of such transfer or assignment.
SECTION 10.7. Certificates and Notes Nonassessable and Fully
Paid. The interests represented by the Certificates and Notes shall be
nonassessable for any losses or expenses of the Issuer or for any reason
whatsoever, and, upon authentication thereof by the Indenture Trustee and the
Owner Trustee pursuant to the Trust Agreement and the Indenture, respectively,
each Certificate and Note shall be deemed fully paid.
SECTION 10.8. Third-Party Beneficiaries. This Agreement will
inure to the benefit of and be binding upon the parties hereto, and their
respective successors and permitted assigns. The Administrator, the Owner
Trustee, individually and on behalf of the Certificateholders, and the Indenture
Trustee, individually and on behalf of the Noteholders are third-party
beneficiaries to this Agreement and are entitled to the rights and benefits
hereunder and may enforce the provisions hereof as it were a party hereto.
Except as otherwise provided in this Agreement, no other person will have any
right or obligation hereunder.
SECTION 10.9. Assignment to Indenture Trustee. 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 the other property constituting
the Owner Trust Estate and/or the assignment of any or all of the Issuer's
rights and obligations hereunder to the Indenture Trustee.
SECTION 10.10. Limitation of Liability of Owner Trustee and
Indenture Trustee. (a) Notwithstanding anything contained herein to the
contrary, this Agreement has been countersigned by Wilmington Trust Company not
in its individual capacity but solely in its capacity as Owner Trustee of the
Issuer, and in no event shall Wilmington Trust Company in its individual
capacity
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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 acknowledged and accepted by
____________________________________________ not in its individual capacity but
solely as Indenture Trustee, and in no event shall
____________________________________________ 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.
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IN WITNESS WHEREOF, the parties have caused this Agreement to
be duly executed by their respective officers as of the day and year first above
written.
CHASE MANHATTAN BANK USA, N.A.,
as Seller and Servicer
By
----------------------------
Name:
Title:
CHASE MANHATTAN AUTO OWNER TRUST,
199_ -__, as Issuer
By: [______________________],
not in its individual
capacity but solely as
Owner Trustee on behalf
of the Issuer
By:_________________________
Name:
Title:
Acknowledged and Accepted:
[------------------------------------------]
not in its individual capacity,
but solely in its capacity
as Indenture Trustee
By:_________________________
Name:
Title:
<PAGE>
SCHEDULE A
LIST OF RECEIVABLES
Delivered to the Owner Trustee and the Indenture Trustee
on the Closing Date.
<PAGE>
SCHEDULE B
Location of Receivable Files
The Chase Manhattan Bank
20 Clinton Avenue South
5th Floor
SENECA Building
Rochester, New York 14604
Iron Mountain
Route 9-W South
P.O. Box 477
Pt. Ewen, NY 12466
Chase Manhattan Automotive Finance Corporation
900 Stewart Avenue
Garden City, NY 11530
<PAGE>
EXHIBIT A
[FORM OF SERVICER'S CERTIFICATE]
A-1
<PAGE>
EXHIBIT B
[FORM OF CERTIFICATEHOLDER AND NOTEHOLDER REPORT]
B-1
<PAGE>
FORM OF INDENTURE (OWNER TRUST)
- - - --------------------------------------------------------------------------------
CHASE MANHATTAN AUTO OWNER TRUST 199-_
Class A-1 _____% Asset Backed Notes
Class A-2 _____% Asset Backed Notes
Class A-3 _____% Asset Backed Notes
Class A-4 _____% Asset Backed Notes
Class [A-5][B] _____% Asset Backed Notes
----------------
INDENTURE
Dated as of _________ __, _____
--------------------------------------------
as Indenture Trustee
- - - --------------------------------------------------------------------------------
<PAGE>
Page
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
----
ARTICLE I
DEFINITIONS AND INCORPORATION BY REFERENCE
<S> <C> <C>
SECTION 1.1 Definitions............................................................................... 2
SECTION 1.2 Incorporation by Reference of Trust Indenture Act......................................... 2
SECTION 1.3 Usage of Terms............................................................................ 3
SECTION 1.4 Calculations of Interest.................................................................. 3
ARTICLE II
THE NOTES
SECTION 2.1 Form..................................................................................... 3
SECTION 2.2 Execution, Authentication and Delivery................................................... 4
SECTION 2.3 Temporary Notes.......................................................................... 4
SECTION 2.4 Registration of Transfer and Exchange.................................................... 5
SECTION 2.5 Mutilated, Destroyed, Lost or Stolen Notes............................................... 7
SECTION 2.6 Persons Deemed Owner..................................................................... 8
SECTION 2.7 Payment of Principal and Interest; Defaulted Interest.................................... 8
SECTION 2.8 Cancellation............................................................................. 9
SECTION 2.9 Release of Collateral.................................................................... 9
SECTION 2.10 Book-Entry Notes......................................................................... 9
SECTION 2.11 Notices to Clearing Agency............................................................... 10
SECTION 2.12 Definitive Notes......................................................................... 11
SECTION 2.13 Authenticating Agent..................................................................... 11
SECTION 2.14 Appointment of Paying Agent.............................................................. 13
ARTICLE III
COVENANTS
SECTION 3.1 Payment of Principal and Interest........................................................ 14
SECTION 3.2 Maintenance of Office or Agency.......................................................... 15
SECTION 3.3 Money for Payments To Be Held in Trust................................................... 15
SECTION 3.4 Existence................................................................................ 16
SECTION 3.5 Protection of Trust Estate............................................................... 16
SECTION 3.6 Opinions as to Trust Estate.............................................................. 17
SECTION 3.7 Performance of Obligations; Servicing of Receivables..................................... 17
SECTION 3.8 Negative Covenants....................................................................... 18
SECTION 3.9 Annual Statement as to Compliance........................................................ 19
<PAGE>
SECTION 3.10 The Issuer May Consolidate, Etc. Only on Certain Terms................................... 19
SECTION 3.11 Successor or Transferee.................................................................. 21
SECTION 3.12 No Other Business........................................................................ 22
SECTION 3.13 No Borrowing............................................................................. 22
SECTION 3.14 Servicer's Obligations................................................................... 22
SECTION 3.15 Guarantees, Loans, Advances and Other Liabilities........................................ 22
SECTION 3.16 Capital Expenditures..................................................................... 22
SECTION 3.17 Restricted Payments...................................................................... 22
SECTION 3.18 Notice of Events of Default.............................................................. 23
SECTION 3.19 Further Instruments and Acts............................................................. 23
ARTICLE IV
SATISFACTION AND DISCHARGE
SECTION 4.1 Satisfaction and Discharge of Indenture.................................................. 23
SECTION 4.2 Application of Trust Money............................................................... 24
SECTION 4.3 Repayment of Moneys Held by Paying Agent................................................. 24
[SECTION 4.4 Duration of the Position of the Indenture Trustee for the Benefit of
Certificateholders...................................................................... 25]
ARTICLE V
REMEDIES
SECTION 5.1 Events of Default......................................................................... 25
SECTION 5.2 Acceleration of Maturity; Rescission and Annulment........................................ 26
SECTION 5.3 Collection of Indebtedness and Suits for Enforcement by the Indenture Trustee............. 26
SECTION 5.4 Remedies; Priorities...................................................................... 29
SECTION 5.5 Optional Preservation of the Receivables.................................................. 30
SECTION 5.6 Limitation of Suits....................................................................... 30
SECTION 5.7 Unconditional Rights of Noteholders To Receive Principal and Interest..................... 31
SECTION 5.8 Restoration of Rights and Remedies........................................................ 31
SECTION 5.9 Rights and Remedies Cumulative............................................................ 31
SECTION 5.10 Delay or Omission Not a Waiver............................................................ 31
SECTION 5.11 Control by Noteholders.................................................................... 32
SECTION 5.12 Waiver of Past Defaults................................................................... 32
SECTION 5.13 Undertaking for Costs..................................................................... 33
SECTION 5.14 Waiver of Stay or Extension Laws.......................................................... 33
SECTION 5.15 Action on Notes........................................................................... 33
SECTION 5.16 Performance and Enforcement of Certain Obligations........................................ 34
ARTICLE VI
THE INDENTURE TRUSTEE
SECTION 6.1 Duties of the Indenture Trustee........................................................... 34
SECTION 6.2 Rights of the Indenture Trustee........................................................... 36
<PAGE>
SECTION 6.3 Individual Rights of the Indenture Trustee................................................ 37
SECTION 6.4 The Indenture Trustee's Disclaimer........................................................ 38
SECTION 6.5 Notice of Defaults........................................................................ 38
SECTION 6.6 Reports by the Indenture Trustee to Hlders................................................ 38
SECTION 6.7 Compensation and Indemnity................................................................ 38
SECTION 6.8 Replacement of the Indenture Trustee...................................................... 39
SECTION 6.9 Successor Indenture Trustee by Merger..................................................... 40
SECTION 6.10 Appointment of Co-Indenture Trustee or Separate Indenture Trustee......................... 40
SECTION 6.11 Eligibility; Disqualification............................................................. 42
SECTION 6.12 Preferential Collection of Claims Against the Issuer...................................... 43
ARTICLE VII
NOTEHOLDERS' LISTS AND REPORTS
SECTION 7.1 The Issuer To Furnish the Indenture Trustee Names and Addresses of the Noteholders......... 43
SECTION 7.2 Preservation of Information; Communications to the Noteholders............................. 43
SECTION 7.3 Reports by the Issuer...................................................................... 44
SECTION 7.4 Reports by the Indenture Trustee........................................................... 44
ARTICLE VIII
ACCOUNTS, DISBURSEMENTS AND RELEASES
SECTION 8.1 Collection of Money........................................................................ 45
SECTION 8.2 Trust Accounts............................................................................. 45
SECTION 8.3 General Provisions Regarding Accounts...................................................... 47
SECTION 8.4 Release of Trust Estate.................................................................... 48
SECTION 8.5 Opinion of Counsel......................................................................... 48
ARTICLE IX
SUPPLEMENTAL INDENTURES
SECTION 9.1 Supplemental Indentures Without Consent of Noteholders.................................... 49
SECTION 9.2 Supplemental Indentures with Consent of the Noteholders................................... 50
SECTION 9.3 Effect of Supplemental Indenture.......................................................... 52
SECTION 9.4 Conformity with Trust Indenture Act....................................................... 52
SECTION 9.5 Reference in Notes to Supplemental Indentures............................................. 52
SECTION 9.6 Execution of Supplemental Indentures...................................................... 52
ARTICLE X
REDEMPTION OF NOTES
<PAGE>
SECTION 10.1 Redemption............................................................................... 53
SECTION 10.2 Form of Redemption Notice................................................................ 53
SECTION 10.3 Notes Payable on Redemption Date......................................................... 54
ARTICLE XI
MISCELLANEOUS
SECTION 11.1 Compliance Certificates and Opinions, etc................................................ 54
SECTION 11.2 Form of Documents Delivered to the Indenture Trustee..................................... 56
SECTION 11.3 Actions of Noteholders................................................................... 57
SECTION 11.4 Notices, etc., to the Indenture Trustee, the Issuer, and Rating Agencies................. 57
SECTION 11.5 Notices to Noteholders; Waiver........................................................... 58
SECTION 11.6 Alternate Payment and Notice Provisions.................................................. 59
SECTION 11.7 Conflict with Trust Indenture Act........................................................ 59
SECTION 11.8 Effect of Headings and Table of Contents................................................. 59
SECTION 11.9 Successors and Assigns................................................................... 59
SECTION 11.10 Separability............................................................................ 59
SECTION 11.11 Benefits of Indenture................................................................... 59
SECTION 11.12 Legal Holidays.......................................................................... 60
SECTION 11.13 GOVERNING LAW........................................................................... 60
SECTION 11.14 Counterparts............................................................................ 60
SECTION 11.15 Recording of Indenture.................................................................. 60
SECTION 11.16 Trust Obligation........................................................................ 60
SECTION 11.17 No Petition............................................................................. 61
SECTION 11.18 Inspection.............................................................................. 61
Exhibit A - Schedule of Receivables
Exhibit B - Form of Class A-1 Note
Exhibit C - Form of Class A-2 Note
Exhibit D - Form of Class A-3 Note
Exhibit E - Form of Class A-4 Note
Exhibit F - Form of Class [A-5][B] Note
Exhibit G - Form of Note Depository Agreement
<PAGE>
CROSS REFERENCE TABLE(1)
</TABLE>
<TABLE>
<CAPTION>
TIA Section Indenture Section
<S> <C> <C>
310 (a)(1).................................................................................. 6.11
(a)(2).................................................................................. 6.11
(a)(3).................................................................................. 6.10
(a)(4).................................................................................. N.A.(2)
(a)(5).................................................................................. 6.11
(b) ............................................................................... 6.8; 6.11
(c) ............................................................................... N.A.
311 (a) ............................................................................... 6.12
(b) ............................................................................... 6.12
(c) ............................................................................... N.A.
312 (a) ............................................................................... 7.1; 7.2
(b) ............................................................................... 7.2
(c) ............................................................................... 7.2
313 (a) ............................................................................... 7.4
(b)(1).................................................................................. 7.4
(b)(2).................................................................................. 7.4
(c) ............................................................................... 7.4
(d) ............................................................................... 7.3
314 (a) ............................................................................... 7.3
(b) ............................................................................... 3.6
(c)(1).................................................................................. 11.1
(c)(2).................................................................................. 11.1
(c)(3).................................................................................. 11.1
(d) ............................................................................... 11.1
(e) ............................................................................... 11.1
(f) ............................................................................... N.A.
315 (a) ............................................................................... 6.1
(b) ............................................................................... 6.5; 11.5
(c) ............................................................................... 6.1
(d) ............................................................................... 6.1
(e) ............................................................................... 5.13
316 (a) (last sentence)..................................................................... 1.1
(a)(1)(A)............................................................................... 5.11
(a)(1)(B)............................................................................... 5.12
(a)(2).................................................................................. N.A.
(b) ............................................................................... 5.7
(c) ............................................................................... N.A.
317 (a)(1).................................................................................. 5.3
(a)(2).................................................................................. 5.3
(b) ............................................................................... 3.3
318 (a) ............................................................................... 11.7
- - - --------
(1) Note: This Cross Reference Table shall not, for any purpose,
be deemed to be part of this Indenture.
(2) N.A. means Not Applicable.
<PAGE>
INDENTURE dated as of _______, [____], between CHASE MANHATTAN AUTO
OWNER TRUST 199_-__, a Delaware business trust (the "Issuer"), and
______________________________________, a national banking association, solely
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 _____%
Asset Backed Notes (the "Class A-1 Notes"), Class A-2 _____% Asset Backed Notes
(the "Class A-2 Notes"), Class A-3 _____% Asset Backed Notes (the "Class A-3
Notes"), Class A-4 _____% Asset Backed Notes (the "Class A-4 Notes" [and Class
[A-5][B] _____% Asset Backed Notes (the "Class A-5 Notes"] and, together with
the Class A-1 Notes, the Class A-2 Notes[,][and] the Class A-3 Notes [and the
Class A-4 Notes], the "[Class A] Notes") [and Class B _____% Asset Backed Notes
(the "Class B Notes" and, together with the Class A 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 [and (only to
the extent expressly provided herein) the Certificateholders], all of the
Issuer's right, title and interest in, to and under (a) the Receivables listed
in Exhibit A hereto, all proceeds thereof and all amounts and monies received
thereon on or after the Cutoff Date (including proceeds of the repurchase of
Receivables by the Seller pursuant to Section 3.2 of the Sale and Servicing
Agreement or the purchase of Receivables by the Servicer pursuant to Section 4.6
or 9.1 of the Sale and Servicing Agreement); (b) the security interests in the
Financed Vehicles granted by the Obligors pursuant to the Receivables and in any
repossessed Financed Vehicles; (c) Liquidation Proceeds and in any proceeds of
any extended warranties, theft and physical damage, credit life or credit
disability policies relating to the Financed Vehicles or the Obligors; (d) any
proceeds from Dealer repurchase obligations relating to the Receivables; (e)
funds on deposit from time to time in the Trust Accounts (including without
limitation the Reserve Account Initial Deposit), and in all investments and
proceeds thereof (but excluding all investment income on funds on deposit in the
Collection Account); (f) the Sale and Servicing Agreement; and (g) all present
and future claims, demands, causes and choses in action in respect of any or all
of the foregoing and all payments on or under and all proceeds of every kind and
nature whatsoever in respect of any or all of the foregoing, including all
proceeds of the conversion, voluntary or involuntary, into cash or other liquid
property, all cash proceeds, accounts, accounts receivable, notes, drafts,
contract rights, 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
<PAGE>
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 except as set
forth herein, and to secure compliance with the provisions of this Indenture,
all as provided in this Indenture.
The Indenture Trustee, as 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 of its ability to the end that the
interests of the Holders of the Notes [and (only to the extent expressly
provided herein) Holders of the Certificates may be adequately and effectively
protected].
ARTICLE I
DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.1 Definitions. Capitalized terms are used in this Indenture
as defined in Section 1.1 to the Sale and Servicing Agreement dated as of
_______, ____, between the Issuer and Chase Manhattan Bank USA, N.A., as Seller
and Servicer (the "Sale and Servicing Agreement").
SECTION 1.2 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.
<PAGE>
SECTION 1.3 Usage of Terms. With respect to all terms in this
Indenture, the singular includes the plural and the plural the singular; words
importing any gender include the other gender; references to "writing" include
printing, typing, lithography, and other means of reproducing words in a visible
form; references to agreements and other contractual instruments include all
subsequent amendments thereto or changes therein entered into in accordance with
their respective terms and not prohibited by this Indenture; references to
Persons include their permitted successors and assigns; and the term "including"
means "including without limitation." All references herein to Articles,
Sections, Subsections and Exhibits are references to Articles, Sections,
Subsections and Exhibits contained in or attached to this Indenture unless
otherwise specified, and each such Exhibit is part of the terms of this
Indenture.
SECTION 1.4 Calculations of Interest. All calculations of interest made
hereunder shall be made on the basis of a year of 360 days of twelve 30-day
months, other than the calculation of interest accrued on the Class A-1 Notes at
the Class A-1 Interest Rate, which will be calculated on the basis of a 360-day
year based upon the actual number of days elapsed [which will be __ days for the
__ Distribution Date for the Class A-1 Notes].
ARTICLE II
THE NOTES
SECTION 2.1 Form. The Class A-1 Notes, the Class A-2 Notes, the Class
A-3 Notes, the Class A-4 Notes and the Class [A-5][B] Notes, in each case
together with the Indenture Trustee's or Authenticating Agent's certificate of
authentication, shall be in substantially the forms set forth in Exhibits B, C,
D, E and F, 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 to be appropriate 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. 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 (except, if applicable,
for one Note representing a residual portion of each class which may be issued
in a denomination other than an integral multiple of $1,000).
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 date of authentication and delivery of such Notes or did
not hold such
<PAGE>
offices at such date. 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 or an Authenticating Agent 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. The terms of the Notes set
forth in Exhibits B, C, D, E, and F are part of the terms of this Indenture.
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.
SECTION 2.2 Execution, Authentication and Delivery. The Notes shall be
executed on behalf of the Issuer by any of its Authorized Officers or by any
other authorized signatory of the Issuer. The signature of any such Authorized
Officer on the Notes may be manual or facsimile.
The Indenture Trustee shall, upon written order of the Seller,
authenticate and deliver Class A-1 Notes for original issue in an aggregate
principal amount of $______________, Class A-2 Notes for original issue in an
aggregate principal amount of $______________, Class A-3 Notes for original
issue in the aggregate principal amount of $______________, Class A-4 Notes for
original issue in the aggregate principal amount of $______________ and Class
[A- 5][B] Notes for original issue in the aggregate principal amount of
$_____________. The respective aggregate principal amount of Class A-1 Notes,
Class A-2 Notes, Class A-3 Notes, Class A-4 Notes and Class [A-5][B] Notes
outstanding at any time may not exceed such amounts, except as provided in
Section 2.5.
SECTION 2.3 Temporary Notes. Pending the preparation of Definitive
Notes, the Issuer may execute, and at the direction of the Issuer, the Indenture
Trustee shall authenticate and deliver, temporary Notes which 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 will 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 3.2, 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
<PAGE>
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 2.4 Registration of Transfer and Exchange. The Issuer shall
cause to be kept a register (the "Note Register") in which, subject to such
reasonable regulations as it may prescribe, the Note Registrar shall provide for
the registration of the Notes and the registration of transfers of the Notes.
Chase shall initially be "Note Registrar" for the purpose of registering Notes
and transfers of Notes as herein provided. In the event that, subsequent to the
date of issuance of the Notes, Chase notifies the Indenture Trustee that it is
unable to act as Note Registrar, the Indenture Trustee shall act, or the
Indenture Trustee shall, with the consent of the Issuer, appoint another bank or
trust company, having an office or agency located in the City of New York and
which agrees to act in accordance with the provisions of this Indenture
applicable to it, to act, as successor Note Registrar under this Indenture.
The Indenture Trustee may revoke such appointment and remove Chase as
Note Registrar if the Indenture Trustee determines in its sole discretion that
Chase failed to perform its obligations under this Indenture in any material
respect. Chase shall be permitted to resign as Note Registrar upon 30 days'
written notice to the Indenture Trustee, the Seller and the Servicer; provided,
however, that such resignation shall not be effective and Chase shall continue
to perform its duties as Note Registrar until the Indenture Trustee has
appointed a successor Note Registrar with the consent of the Issuer.
If a Person other than the Indenture Trustee is appointed by the Issuer
as the 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
conclusively 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.
An institution succeeding to the corporate agency business of the Note
Registrar shall continue to be the Note Registrar without the execution or
filing of any paper or any further act on the part of the Indenture Trustee or
such Note Registrar.
The Note Registrar shall maintain [in Luxembourg (for so long as any
Notes are listed on the Luxembourg Stock Exchange) and] in the City of New York
an office or offices or agency or agencies where Notes may be surrendered for
registration of transfer or exchange. The Note Registrar initially designates
its corporate
<PAGE>
trust office located at 450 West 33rd Street, New York, New York 10001-2697 as
its office for such purposes. The Note Registrar shall give prompt written
notice to the Indenture Trustee, the Seller, the Servicer and to the Noteholders
of any change in the location of such office or agency.
Upon surrender for registration of transfer of any Note at the office
or agency of the Issuer to be maintained as provided in Section 3.2, if the
requirements of Section 8-401(1) of the Relevant UCC are met, the Issuer shall
execute, the Indenture Trustee shall authenticate and (if the Note Registrar is
different than the Indenture Trustee, then the Note Registrar shall) deliver to
the Noteholder, in the name of the designated transferee or transferees, one or
more new Notes, in any authorized denominations, of the same class and a like
aggregate principal amount.
At the option of the Holder, the Notes may be exchanged for other Notes
in any authorized denominations, of the same class and 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(1) of the Relevant UCC are met, the Issuer shall execute and
the Indenture Trustee shall authenticate and (if the Note Registrar is different
than the Indenture Trustee, then the Note Registrar shall) deliver to the
Noteholder, the Notes which the Noteholder making the exchange is entitled to
receive.
All Notes issued upon any registration of transfer or exchange of the
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 (i) 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 a commercial bank or trust company
located, or having a correspondent located, in the City of New York or the city
in which the Corporate Trust Office is located, or by a member firm of a
national securities exchange, and (ii) accompanied by such other documents as
the Indenture Trustee may require. Each Note surrendered for registration of
transfer or exchange shall be cancelled by the Note Registrar and disposed of by
the Indenture Trustee or Note Registrar in accordance with its customary
practice.
No service charge shall be made to a Holder for any registration of
transfer or exchange of the 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
<PAGE>
registration of transfer or exchange of Notes, other than exchanges pursuant to
Section 2.3 or 9.5 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 the Notes selected for redemption or of any Note for a
period of 15 days preceding the due date for any payment in full with respect to
such Note.
SECTION 2.5 Mutilated, Destroyed, Lost or Stolen Notes. If (i) any
mutilated Note is surrendered to the Note Registrar, or the Note Registrar
receives evidence to its satisfaction of the destruction, loss or theft of any
Note, and (ii) there is delivered to the Note Registrar and the Indenture
Trustee such security or indemnity as may be required by them to hold the
Issuer, the Note Registrar 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 Section 8-405 of the Relevant UCC are met, the Issuer shall
execute and the Indenture Trustee or an Authenticating Agent shall authenticate
and (if the Note Registrar is different from the Indenture Trustee, the Note
Registrar shall) deliver, in exchange for or in lieu of any such mutilated,
destroyed, lost or stolen Note, a replacement Note of like class, tenor and
denomination; provided 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 lieu of which such replacement Note was issued presents for
payment such original Note, the Issuer, the Note Registrar 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, the Note Registrar 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 2.5 in
replacement of any mutilated, destroyed, lost or stolen Note shall constitute an
original additional contractual obligation of the
<PAGE>
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 2.6 Persons Deemed Owner. Prior to due presentment for
registration of transfer of any Note, the Issuer, the Indenture Trustee, the
Note Registrar and any agent of the Issuer, the Indenture Trustee or the Note
Registrar 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 shall be overdue, and neither the
Issuer, the Indenture Trustee or the Note Registrar nor any agent of the Issuer,
the Indenture Trustee or the Note Registrar shall be bound by notice to the
contrary.
SECTION 2.7 Payment of Principal and Interest; Defaulted Interest. (a)
The Notes shall accrue interest as provided in the forms of the Class A-1 Note,
the Class A-2 Note, the Class A-3 Note, the Class A-4 Note and the Class
[A-5][B] Note set forth in Exhibits B, C, D, E and F, respectively, and such
interest shall be payable on each Distribution Date as specified therein. Any
installment of interest or principal, if any, payable on any Note which 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 preceding 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 2.12, with respect to the 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, except
for the final installment of principal payable with respect to such Note on a
Distribution Date or on a Note Final Scheduled Distribution Date (and except for
the Redemption Price for any Note called for redemption pursuant to Section 10.1
which shall be payable as provided below. The funds represented by any such
checks returned undelivered shall be held in accordance with Section 3.3.
(b) The principal of each Note shall be payable in installments no
later than 12 noon, New York City time, on each Distribution Date as provided in
the forms of the Class A-1 Note, the Class A-2 Note, the Class A-3 Note, the
Class A-4 Note and the Class [A-5][B] Note, set forth in Exhibits B, C, D, E and
F, respectively. Notwithstanding the foregoing, the entire unpaid principal
amount of the Notes shall be due and payable, if not
<PAGE>
previously paid, on the date on which an Event of Default shall have occurred
and be continuing, if the Indenture Trustee or the Holders of the Notes
representing 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 5.2.
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 (i) transmitted by facsimile on such Record Date if Book-Entry
Notes are outstanding or (ii) mailed as provided in Section 10.2 not later than
three Business Days after such Record Date if Definitive Notes are outstanding
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.
SECTION 2.8 Cancellation. All Notes surrendered for payment,
registration of transfer, exchange or redemption shall, if surrendered to any
Person other than the Note Registrar, be delivered to the Note Registrar and
shall be promptly cancelled by the Note Registrar. The Issuer may at any time
deliver to the Note Registrar 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
Note Registrar. 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 Note
Registrar in accordance with its standard retention or disposal policy as in
effect at the time unless the Issuer shall direct that they be destroyed or
returned to it; provided that such direction is timely and the Notes have not
been previously disposed of by the Note Registrar.
SECTION 2.9 Release of Collateral. Subject to Section 11.1, the
Indenture Trustee shall release property from the lien of this Indenture only
upon request of the Issuer accompanied by an Officer's Certificate, an Opinion
of Counsel and Independent Certificates in accordance with the 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 2.10 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. Such Notes shall initially be registered on the
Note Register in the name of Cede & Co., the nominee of the initial Clearing
Agency, and no Note Owner will receive a Definitive Note representing such Note
Owner's interest in such
<PAGE>
Note, except as provided in Section 2.12. Unless and until Definitive Notes have
been issued to Note Owners pursuant to Section 2.12:
(a) the provisions of this Section shall be in full force and effect;
(b) the Note Registrar, the Paying Agent 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;
(c) to the extent that the provisions of this Section conflict with
any other provisions of this Indenture, the provisions of this Section shall
control;
(d) the rights of the Note Owners shall be exercised only through the
Clearing Agency (or to the extent the Note Owners are not Clearing Agency
Participants, through the Clearing Agency Participants through which such Note
Owners own Book-Entry Notes) 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, and all references in this Indenture to actions by
the Noteholders shall refer to actions taken by the Clearing Agency upon
instructions from the Clearing Agency Participants, and all references in this
Indenture to distributions, notices, reports and statements to the Noteholders
shall refer to distributions, notices, reports and statements to the Clearing
Agency, as registered holder of the Notes, as the case may be, for distribution
to the Note Owners in accordance with the procedures of the Clearing Agency.
Pursuant to the Note Depository Agreement, unless and until Definitive Notes are
issued pursuant to Section 2.12, 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
(e) whenever this Indenture requires or permits actions to be taken
based upon instructions or directions of the Holders of the 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 the 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 2.11 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 the Note Owners pursuant to
Section 2.12, the Indenture Trustee shall give all such notices and
communications specified herein to
<PAGE>
be given to the Holders of the Notes to the Clearing Agency, and shall have no
obligation to the Note Owners.
SECTION 2.12 Definitive Notes. If (a) the Servicer 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 Notes, and
the Servicer is unable to locate a qualified successor, (b) the Servicer at its
option advises the Indenture Trustee in writing that it elects to terminate the
book-entry system through the Clearing Agency, or (c) after the occurrence of an
Event of Default or an Event of Servicing Termination, the Note Owners
representing beneficial interests aggregating not less than a majority of the
Outstanding Amount of the Notes advise the Indenture Trustee and the Clearing
Agency through the Clearing Agency Participants in writing, and if the Clearing
Agency shall so notify the Indenture Trustee that the continuation of a
book-entry system through the Clearing Agency is no longer in the best interests
of the Note Owners, then the Clearing Agency shall notify all the Note Owners of
the occurrence of any such event and of the availability of Definitive Notes to
the Note Owners requesting the same. Upon surrender to the Note Registrar of the
typewritten Note or Notes representing the Book-Entry Notes by the Clearing
Agency, accompanied by re-registration instructions, the Issuer shall execute
and the Indenture Trustee shall authenticate and (if the Note Registrar is
different than the Indenture Trustee, then the Note Registrar shall) deliver 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 the
Definitive Notes, the Indenture Trustee shall recognize the Holders of the
Definitive Notes as the Noteholders.
SECTION 2.13 Authenticating Agent.
(a) The Indenture Trustee may appoint one or more authenticating agents
(each, an "Authenticating Agent") with respect to the Notes which shall be
authorized to act on behalf of the Indenture Trustee in authenticating the Notes
in connection with the issuance, delivery, registration of transfer, exchange or
repayment of the Notes. The Indenture Trustee hereby appoints Chase as
Authenticating Agent for the authentication of the Notes upon any registration
of transfer or exchange of such Notes. [If Definitive Notes are outstanding and
for so long as any Notes are listed on the Luxembourg Stock Exchange, the
Indenture Trustee shall appoint an Authenticating Agent having an office or
agency in Luxembourg]. Whenever reference is made in this Indenture to the
authentication of the Notes by the Indenture Trustee or the Indenture Trustee's
certificate of authentication, such reference shall be deemed to include
authentication on behalf of the Indenture Trustee by an Authenticating Agent and
a certificate of authentication executed on behalf of the Indenture Trustee by
an Authenticating Agent.
<PAGE>
Each Authenticating Agent, other than Chase, shall be acceptable to the Issuer.
(b) Any institution succeeding to the corporate agency business of an
Authenticating Agent shall continue to be an Authenticating Agent without the
execution or filing of any paper or any further act on the part of the Indenture
Trustee or such Authenticating Agent.
(c) An Authenticating Agent may at any time resign by giving written
notice of resignation to the Indenture Trustee and the Issuer. The Indenture
Trustee may at any time terminate the agency of an Authenticating Agent by
giving notice of termination to such Authenticating Agent and to the Issuer.
Upon receiving such a notice of resignation or upon such a termination, or in
case at any time an Authenticating Agent shall cease to be acceptable to the
Indenture Trustee or the Issuer, the Indenture Trustee promptly may appoint a
successor Authenticating Agent with the consent of the Issuer. Any successor
Authenticating Agent upon acceptance of its appointment hereunder shall become
vested with all the rights, powers and duties of its predecessor hereunder, with
like effect as if originally named as an Authenticating Agent. No successor
Authenticating Agent shall be appointed unless acceptable to the Issuer.
(d) The Servicer shall pay the Authenticating Agent from time to time
reasonable compensation for its services under this Section 2.13.
(e) The provisions of Sections 6.1, 6.2, 6.3, 6.4, 6.7 and 6.9 shall be
applicable, mutatis mutandis, to any Authenticating Agent.
(f) Pursuant to an appointment made under this Section 2.13, the Notes
may have endorsed thereon, in lieu of the Indenture Trustee's certificate of
authentication, an alternate certificate of authentication in substantially the
following form:
This is one of the Notes referred to in the within mentioned Indenture.
___________________________
as Indenture Trustee
By:________________________
Authorized Officer
or
<PAGE>
___________________________
as Authenticating Agent
for the Indenture Trustee,
___________________________
Authorized Officer
SECTION 2.14 Appointment of Paying Agent.
(a) The Indenture Trustee may appoint a Paying Agent with respect to
the Notes. The Indenture Trustee hereby appoints Chase as the initial Paying
Agent. [If Definitive Notes are outstanding and for so long as any Notes are
listed on the Luxembourg Stock Exchange, the Indenture Trustee shall appoint a
co-Paying Agent with an office or agency in Luxembourg for the purpose of making
distributions to the holders of such Definitive Notes.] The Paying Agent shall
have the revocable power to withdraw funds from the Accounts and make
distributions to the Noteholders, the Servicer, the Administrator and the Owner
Trustee pursuant to Section 5.5 of the Sale and Servicing Agreement. The
Indenture Trustee may revoke such power and remove the Paying Agent if the
Indenture Trustee determines in its sole discretion that the Paying Agent shall
have failed to perform its obligations under this Indenture in any material
respect or for other good cause. Chase shall be permitted to resign as Paying
Agent upon 30 days' written notice to the Seller and the Indenture Trustee. In
the event that Chase shall no longer be the Paying Agent, the Indenture Trustee
shall appoint a successor to act as Paying Agent (which shall be a bank or trust
company and may be the Indenture Trustee) with the consent of the Seller, which
consent shall not be unreasonably withheld. If at any time the Indenture Trustee
shall be acting as the Paying Agent, the provisions of Sections 6.1, 6.3 and 6.4
shall apply, mutatis mutandis, to the Indenture Trustee in its role as Paying
Agent.
The Indenture Trustee will cause each Paying Agent, other than itself
and Chase, 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;
<PAGE>
(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
the Notes if at any time it ceases to meet the standards required to be
met by the 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.
(b) Chase in its capacity as initial Paying Agent hereunder agrees that
it (i) will hold all sums held by it hereunder for payment to the Noteholders in
trust for the benefit of the Noteholders entitled thereto until such sums shall
be paid to such Noteholders and (ii) shall comply with all requirements of the
Code regarding the withholding by the Indenture Trustee of payments in respect
of United States federal income taxes due from Note Owners.
(c) An institution succeeding to the corporate agency business of the
Paying Agent shall continue to be the Paying Agent without the execution or
filing of any paper or any further act on the part of the Indenture Trustee or
such Paying Agent.
ARTICLE III
COVENANTS
SECTION 3.1 Payment of Principal and Interest. The Issuer will duly and
punctually pay the principal of and interest on the Notes in accordance with the
terms of the Notes and this Indenture. Without limiting the foregoing, subject
to Section 8.2(c), the Issuer will cause to be distributed all amounts on
deposit in the Note Distribution Account on a Distribution Date deposited
therein pursuant to the Sale and Servicing Agreement (i) for the benefit of the
Class A-1 Notes, to the holders of the Class A-1 Notes, (ii) for the benefit of
the Class A-2 Notes, to the holders of the Class A-2 Notes, (iii) for the
benefit of the Class A-3 Notes, to the holders of the Class A-3 Notes, (iv) for
the benefit of the Class A-4 Notes, to the holders of the Class A-4 Notes and
(v) for the benefit of the Class [A-5][B] Notes, to the holders of the Class
[A-5][B] Notes. 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.
<PAGE>
SECTION 3.2 Maintenance of Office or Agency. The Issuer will maintain
[in Luxembourg (if Definitive Notes are outstanding and for so long as such
Definitive Notes are listed on the Luxembourg Stock Exchange) and] in the City
of New York, an office or agency where Notes may be surrendered for registration
of transfer or exchange. The Issuer hereby initially appoints the Note Registrar
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 3.3 Money for Payments To Be Held in Trust. As provided in
Sections 8.2(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
and the Note Distribution Account pursuant to Section 8.2(c) shall be made on
behalf of the Issuer by the Indenture Trustee or by a Paying Agent, and no
amounts so withdrawn from the Collection Account and the Note Distribution
Account for payments on the Notes shall be paid over to the Issuer except as
provided in this Section 3.3.
On or before each Distribution Date and Redemption Date, at the
direction of the Servicer in accordance with Section 5.5 of the Sale and
Servicing Agreement, the Indenture Trustee or the Paying Agent shall deposit in
the Note Distribution Account 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 or deposit was made by the Indenture Trustee) shall promptly notify the
Indenture Trustee of its action or failure so to act.
The Issuer may, at any time, for the purpose of obtaining the
satisfaction and discharge of this Indenture or for any other purpose, 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 a
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 the 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 its 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
<PAGE>
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
that the Indenture Trustee or such Paying Agent, before being required to make
any such repayment, shall at the expense 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 of the Issuer, any
other reasonable means of notification of such repayment (including, but not
limited to, mailing notice of such repayment to the 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 3.4 Existence. Except as otherwise permitted by the provisions
of Section 3.10, 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 to the 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 3.5 Protection of Trust Estate. The Issuer will from time to
time prepare (or shall cause to be prepared), execute and deliver all such
supplements and amendments hereto and all such financing statements,
continuation statements, instruments of further assurance and other instruments,
and will take such other action necessary or advisable to:
(a) maintain or preserve the lien and security interest
(and the priority thereof) of this Indenture or carry out more
effectively the purposes hereof;
(b) perfect, publish notice of or protect the validity
of any Grant made or to be made by this Indenture;
(c) enforce the rights of the Indenture Trustee and the
Noteholders in any of the Collateral; or
(d) preserve and defend title to the Trust Estate and
the rights of the Indenture Trustee and the Noteholders in
<PAGE>
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 filed by the Indenture Trustee pursuant to this
Section.
SECTION 3.6 Opinions as to Trust Estate. (a) 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 of each calendar year, commencing with March
31, [____], 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 are necessary to maintain the
perfection of 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 the perfection of such lien and
security interest. Such Opinion of Counsel shall also describe the recording,
filing, rerecording 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 perfection of the lien and security
interest of this Indenture until March 31 in the following calendar year.
SECTION 3.7 Performance of Obligations; Servicing of Receivables. (a)
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 effectiveness of, any such instrument or agreement, except as
ordered by any bankruptcy or other court or as expressly provided in this
Indenture, any other Basic Documents 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
<PAGE>
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 other Basic
Documents and in the instruments and agreements included in the Trust Estate,
including but not limited to preparing (or causing to be prepared) and 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.
(d) If the Issuer shall have knowledge of the occurrence of an Event of
Servicing Termination under the Sale and Servicing Agreement, the Issuer shall
promptly notify the Indenture Trustee and the Rating Agencies thereof in
accordance with Section 11.4, and shall specify in such notice the action, if
any, the Issuer is taking in respect of such default. If an Event of Servicing
Termination 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) 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 that, unless such action is
specifically permitted hereunder or under the other Basic Documents, it will
not, without the prior written consent of the Indenture Trustee or the Holders
of at least a majority of 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 or
the Basic Documents, or waive timely performance or observance by the Servicer
or the Seller under the Sale and Servicing Agreement; provided that no such
amendment shall (i) 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 (ii) reduce the aforesaid percentage of
the Notes which are 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 under the circumstances.
SECTION 3.8 Negative Covenants. So long as any Notes are Outstanding,
the Issuer shall not:
<PAGE>
(a) except as expressly permitted by this Indenture or the
other Basic Documents, 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;
(b) 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 by reason of the
payment of the taxes levied or assessed upon any part of the Trust
Estate; or
(c) (i) 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, (ii) 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 a Financed
Vehicle and arising solely as a result of an action or omission of the
related Obligor) or (iii) 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 3.9 Annual Statement as to Compliance. The Issuer will deliver
to the Indenture Trustee on or before March 31 of each year, commencing March
31, [____], and otherwise in compliance with the requirements of TIA Section
314(a)(4), an Officer's Certificate stating, as to the Authorized Officer
signing such Officer's Certificate, that
(a) a review of the activities of the Issuer during such year
and of performance under this Indenture has been made under such
Authorized Officer's supervision; and
(b) to the best of such Authorized Officer's knowledge, based
on such review, the Issuer has complied with all conditions and
covenants in all material respects under this Indenture throughout such
year, or, if there has been a default in the compliance of any such
condition or covenant, specifying each such default known to such
Authorized Officer and the nature and status thereof.
SECTION 3.10 The Issuer May Consolidate, Etc. Only on Certain
Terms. (a) The Issuer shall not consolidate or merge with or into
any other Person, unless
<PAGE>
(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
thereof 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 the 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;
(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 Trust, any Noteholder or any Certificateholder;
(v) any action as 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 Section 3.10 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) Except as otherwise expressly permitted by this Indenture or the
other Basic Documents, the Issuer shall not convey or transfer all or
substantially all 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 shall (A) be a United States citizen or a Person
organized and existing under the laws of the United States of America
or any State thereof, (B) 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 the 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 agree by means
<PAGE>
of such supplemental indenture that all right, title and interest so
conveyed or transferred shall be subject and subordinate to the rights
of the Holders of the Notes, (D) unless otherwise provided in such
supplemental indenture, expressly agree 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 agree by means of such supplemental indenture that such
Person (or if a group of persons, then one specified Person) shall
prepare (or cause to be prepared) and 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 not have any material adverse tax
consequence to the Trust, any Noteholder [or any Certificateholder];
(v) any action as 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 Officers' Certificate and an Opinion of Counsel each stating that
such conveyance or transfer and such supplemental indenture comply with
this Section 3.10 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. (a) 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 in accordance with Section 3.10(b), Chase Manhattan Auto Owner Trust
199_-__ 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 from
the Person acquiring such assets and properties
<PAGE>
stating that Chase Manhattan Auto Owner Trust 199_-__ 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 other Basic
Documents, issuing the Notes [and the Certificates], making payments thereon,
and such other activities that are necessary, suitable or desirable to
accomplish the foregoing or are incidental to the purposes as set forth in
Section 2.3 of the Trust Agreement.
SECTION 3.13 No Borrowing. The Issuer shall not issue, incur, assume,
guarantee or otherwise become liable, directly or indirectly, for any
indebtedness except for money borrowed in respect of the Notes or in accordance
with the Basic Documents.
SECTION 3.14 Servicer's Obligations. The Issuer shall use its best
efforts to cause the Servicer to comply with 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 assuming 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) other than the purchase of the Receivables and
related property pursuant to the Sale and Servicing Agreement.
SECTION 3.17 Restricted Payments. The Issuer shall not,
directly or indirectly, (a) 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, (b) redeem, purchase, retire, or
otherwise acquire for value any such ownership or equity interest
or security or (c) set aside or otherwise segregate any amounts for
any such purpose; provided that the Issuer may make, or cause to be
made, distributions to the Servicer, the Seller, the Owner Trustee,
the Administrator[,] [and] the Indenture Trustee [and the
Certificateholders] as permitted by, and to the extent funds are
available for such purpose under, the Basic Documents. The Issuer
<PAGE>
will not, directly or indirectly, make payments to or distributions from the
Collection Account except in accordance with this Indenture and the other Basic
Documents.
SECTION 3.18 Notice of Events of Default. The Issuer agrees to give the
Indenture Trustee and the Rating Agencies prompt written notice of each Event of
Default, any Event of Servicing Termination and each default on the part of the
Seller of its obligations under the Sale and Servicing Agreement.
SECTION 3.19 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 4.1 Satisfaction and Discharge of Indenture. This Indenture
shall cease to be of further effect with respect to the Notes except as to (a)
rights of registration of transfer and exchange, (b) substitution of mutilated,
destroyed, lost or stolen Notes, (c) rights of Noteholders to receive payments
of principal thereof and interest thereon, (d) Sections 3.2, 3.3, 3.4, 3.5, 3.8,
3.10, 3.12, 3.13, 3.15, 3.16 and 3.18, (e) the rights, obligations and
immunities of the Indenture Trustee hereunder (including the rights of the
Indenture Trustee under Section 6.7 and the obligations of the Indenture Trustee
under Sections 4.2 and 4.4) and (f) 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
(i) either
(A) all Notes theretofore authenticated and delivered
(other than (1) the Notes that have been destroyed, lost or
stolen and that have been replaced or paid as provided in
Section 2.5 and (2) the Notes for which 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 3.3) have
been delivered to the Indenture Trustee for cancellation; or
(B) all Notes not theretofore delivered to the
Indenture Trustee for cancellation:
(1) have become due and payable,
<PAGE>
(2) will become due and payable at their
respective Note Final Scheduled Distribution Dates
within one year, or
(3) 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 clauses (1), (2) or (3) of
Section 4.1(i)(B), 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 unpaid principal
and accrued interest on such Notes not theretofore delivered
to the Indenture Trustee for cancellation when due on their
respective Note Final Scheduled Distribution Dates or
Redemption Date (if the Notes shall have been called for
redemption pursuant to Section 10.1);
(ii) the Issuer has paid or caused to be paid all other
sums payable hereunder by the Issuer; and
(iii) 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 11.1 and each stating that all conditions precedent herein
provided for relating to the satisfaction and discharge of this
Indenture have been complied with.
SECTION 4.2 Application of Trust Money. All moneys deposited with the
Indenture Trustee pursuant to Section 4.1(i)(B) 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 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 4.3 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
<PAGE>
according to Section 3.3 and thereupon such Paying Agent shall be released from
all further liability with respect to such moneys.
[SECTION 4.4 Duration of the Position of the Indenture Trustee for the
Benefit of Certificateholders. Notwithstanding (i) the earlier payment in full
of all principal and interest due to the Noteholders under the terms of the
Notes of each class, (ii) the cancellation of such Notes pursuant to Section 2.8
and (iii) the discharge of the Indenture Trustee's duties hereunder with respect
to such Notes, the Indenture Trustee shall continue to act in the capacity of
the Indenture Trustee hereunder for the benefit of the Certificateholders and
the Indenture Trustee, for the benefit of the Certificateholders, shall comply
with its obligations under Sections 5.1, 5.5, 5.6, 7.5, 8.1 and 8.2 of the Sale
and Servicing Agreement, as appropriate, until such time as all distributions in
respect of the Certificate Balance and interest due to the Certificateholders
have been paid in full.]
ARTICLE V
REMEDIES
SECTION 5.1 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):
(a) 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;
(b) default in the payment of the principal of or any
installment of the principal of any Note when the same becomes
due and payable;
(c) 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) which
default materially and adversely affects the rights of the Noteholders,
and which default shall continue or not be cured for a period of 30
days (or for such longer period, not in excess of 90 days, as may be
reasonably necessary to remedy such default; provided that such default
is capable of remedy within 90 days or less and the Servicer on behalf
of the Issuer delivers an Officer's Certificate to the Indenture
Trustee to the effect that the Issuer has commenced, or will promptly
commence and diligently pursue, all reasonable efforts to remedy such
default) after there shall have been given, by registered or certified
mail, to the Issuer by the Indenture Trustee or to the Issuer and
<PAGE>
the Indenture Trustee by the Holders of at least 25% of the Outstanding
Amount of the [Controlling] Notes, a written notice specifying such
default and requiring it to be remedied and stating that such notice is
a "Notice of Default" hereunder; and
(d) an Insolvency Event shall have occurred for the
Issuer.
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 (c), its status and what action
the Issuer is taking or proposes to take with respect thereto.
SECTION 5.2 Acceleration of Maturity; Rescission and Annulment. If an
Event of Default shall occur and be continuing, then and in every such case the
Indenture Trustee or the Holders of the [Controlling] 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 the [Controlling] 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 the [Controlling] 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;
provided, that, no such rescission shall affect any subsequent default or impair
any right consequent thereto.
SECTION 5.3 Collection of Indebtedness and Suits for Enforcement by the
Indenture Trustee. (a) 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 upon the overdue principal, and, to the extent payment at such rate of
interest shall be legally enforceable, upon 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,
<PAGE>
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 5.4, 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,
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 the 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:
(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
<PAGE>
negligence, bad faith or willful misconduct) and of the
Noteholders allowed in such proceedings;
(ii) unless prohibited by applicable law and regulations, to
vote on behalf of the Holders of the 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 the Notes allowed in any
judicial 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.
<PAGE>
(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 5.4 Remedies; Priorities. (a) If an Event of Default shall have
occurred and be continuing and the Notes have been accelerated under Section
5.2, the Indenture Trustee may do one or more of the following (subject to
Section 5.5):
(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
Relevant 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 that the Indenture Trustee may not sell or otherwise liquidate
the Trust Estate following an Event of Default, 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
[and the Certificateholders] are sufficient to discharge in full all
amounts then due and unpaid upon such Notes for principal and
interest[and the Certificate Balance plus accrued interest thereon], or
(C)(1) there has been an Event of Default described in Section 5.1(a)
or (b), (2) 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 (3) the Indenture Trustee
obtains the consent of Holders of 66-2/3% of the Outstanding Amount of
the [Controlling] 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.
<PAGE>
(b) If the Indenture Trustee collects any money or property pursuant to
this Article V, it shall pay out such money or property (and other amounts
including amounts held on deposit in the Reserve Account) held as Collateral for
the benefit of the Noteholders in the following order:
FIRST: to the Indenture Trustee for amounts due under
Section 6.7; and
SECOND: to the Collection Account for distribution
pursuant to Section 9.1(b) of the Sale and Servicing
Agreement.
SECTION 5.5 Optional Preservation of the Receivables. If the Notes have
been declared to be due and payable under Section 5.2 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 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 5.6 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:
(a) such Holder has previously given written notice to
the Indenture Trustee of a continuing Event of Default;
(b) the Holders of not less than 25% of the Outstanding Amount
of the [Controlling] 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 the Indenture Trustee hereunder;
(c) such Holder or Holders have offered to the Indenture
Trustee indemnity reasonably satisfactory to it against the costs,
expenses and liabilities to be incurred in complying with such request;
(d) the Indenture Trustee for 60 days after its receipt
of such notice, request and offer of indemnity has failed to
institute such proceedings; and
(e) no direction inconsistent with such written request
has been given to the Indenture Trustee during such 60-day
<PAGE>
period by the Holders of a majority of the Outstanding Amount
of the [Controlling] Notes;
it being understood and intended that no one or more Holders of the 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 the 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 the
[Controlling] Notes, each representing less than a majority of the Outstanding
Amount of the [Controlling] 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 5.7 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 5.8 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 through no such proceeding had
been instituted.
SECTION 5.9 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
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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 [Controlling] Noteholders, as the case may be.
SECTION 5.11 Control by Noteholders. The Holders of a majority of the
Outstanding Amount of the [Controlling] 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
(a) such direction shall not be in conflict with any
rule of law or with this Indenture;
(b) subject to the express terms of Section 5.4, any direction
to the Indenture Trustee to sell or liquidate the Trust Estate shall be
by the Holders of the Notes representing not less than 100% of the
Outstanding Amount of the [Controlling] Notes;
(c) if the conditions set forth in Section 5.5 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 the Notes representing less than 100% of the Outstanding
Amount of the [Controlling] Notes to sell or liquidate the Trust Estate
shall be of no force and effect;
(d) the Indenture Trustee may take any other action
deemed proper by the Indenture Trustee that is not
inconsistent with such direction; and
(e) such direction shall be in writing;
provided, further, that, subject to Section 6.1, 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 5.2, the
Holders of the Notes of not less than a majority of the Outstanding Amount of
the [Controlling] Notes may, on behalf of all such Holders, 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 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
<PAGE>
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. The
Issuer shall give prompt written notice of any waiver to the Rating Agencies.
SECTION 5.13 Undertaking for Costs. All parties to this Indenture
agree, and each Holder of any 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
the Indenture Trustee, the filing by any party litigant in such Proceeding of an
undertaking to pay the costs of such Proceeding, and that such court may in its
discretion assess reasonable costs, including reasonable attorneys' fees,
against any party litigant in such Proceeding, 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
<PAGE>
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.
SECTION 5.16 Performance and Enforcement of Certain Obligations. (a)
Promptly following a request from the Indenture Trustee to do so and at the
Administrator's expense, the Issuer agrees to take all such lawful action as the
Indenture Trustee may request to compel or secure the performance and observance
by the Seller and the Servicer, as applicable, of each of their respective
obligations to the Issuer under or in connection with the Sale and Servicing
Agreement in accordance with the terms thereof, 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 respective
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 66-2/3% of the Outstanding Amount of the [Controlling] Notes shall,
foreclose upon its security interest in the Issuer's rights under the Sale and
Servicing Agreement and 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, including the right or power to take any
action to compel or secure performance or observance by the Seller or the
Servicer of each of their respective obligations to the Issuer thereunder and to
give any consent, request, notice, direction, approval, extension or waiver
under the Sale and Servicing Agreement, and any right of the Issuer to take such
action shall be suspended.
ARTICLE VI
THE INDENTURE TRUSTEE
SECTION 6.1 Duties of the Indenture Trustee. (a) The Indenture Trustee,
both prior to and after the occurrence of an Event of Default, shall undertake
to perform such duties and only such duties as are specifically set forth in
this Indenture and the Sale and Servicing Agreement. If an Event of Default
known to the Indenture Trustee has occurred and is continuing, the Indenture
Trustee shall exercise the rights and powers vested in it by this Indenture and
the Sale and Servicing Agreement 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
<PAGE>
such person's own affairs; provided, however, that if the Indenture Trustee
shall assume the duties of the Servicer pursuant to Section 8.2 of the Sale and
Servicing Agreement, the Indenture Trustee in performing such duties shall use
the degree of skill and attention customarily exercised by a servicer with
respect to automobile receivables that it services for itself.
The Indenture Trustee, upon receipt of any resolutions, certificates,
statements, opinions, reports, documents, orders, or other instruments furnished
to the Indenture Trustee that shall be specifically required to be furnished
pursuant to any provision of this Indenture or the Sale and Servicing Agreement,
shall examine them to determine whether they conform to the requirements of this
Indenture or the Sale and Servicing Agreement; provided, however, that the
Indenture Trustee shall not be responsible for the accuracy or content of any
such resolution, certificate, statement, opinion, report, document, order or
other instrument furnished by the Servicer to the Indenture Trustee pursuant to
this Indenture or the Sale and Servicing Agreement.
(b) No provision of this Indenture shall be construed to relieve the
Indenture Trustee from liability for its own negligent action, its own negligent
failure to act, or its own bad faith or wilful malfeasance; provided, however,
that:
(i) prior to the occurrence of an Event of Default, and after
the curing of all such Events of Default, the Indenture Trustee
undertakes to perform such duties and only such duties as are
specifically set forth in this Indenture and the Sale and Servicing
Agreement, and no implied covenants or obligations shall be read into
this Indenture or the Sale and Servicing Agreement against the
Indenture Trustee, and in the absence of bad faith on its part or
manifest error, 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 or the
Sale and Servicing Agreement; and
(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 nor shall the Indenture Trustee be liable with respect
to any action it takes or omits to take in good faith in accordance
with this Indenture or in accordance with a direction received by it
pursuant to Section 5.11.
(c) 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.
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(d) 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.
(e) 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 indemnity satisfactory to it against such risk or liability is
not assured to it, and none of the provisions contained in this Indenture shall
in any event require the Indenture Trustee to perform, or be responsible for the
manner of performance of, any of the obligations of the Servicer (including its
obligations as custodian) under this Indenture except during such time, if any,
as the Indenture Trustee shall be the successor to, and be vested with the
rights, duties, powers and privileges of, the Servicer in accordance with the
terms of the Sale and Servicing Agreement.
(f) The Indenture Trustee shall not be charged with knowledge of an
Event of Default until such time as a Responsible Officer shall have actual
knowledge or have received written notice thereof.
(g) Except for actions expressly authorized by this Indenture or, based
upon an Opinion of Counsel, in the best interests of the Noteholders, the
Indenture Trustee shall take no action reasonably likely to impair the security
interests created or existing under any Receivable or to impair the value of any
Receivable.
(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 6.2 Rights of the Indenture Trustee. (a) The Indenture Trustee
may conclusively 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 Opinion of Counsel. The Indenture Trustee shall not be liable for any
action it takes, suffers or omits to take in good faith in reliance on the
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
<PAGE>
hereunder. The Indenture Trustee shall have no duty to monitor the
performance of the Issuer.
(d) The Indenture Trustee shall not be personally 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 written
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 written advice or opinion of
such counsel. A copy of such written advice or Opinion of Counsel shall be
provided to the Seller, the Servicer and the Rating Agencies.
(f) [Reserved].
(g) Prior to the occurrence of an Event of Default and after the curing
of all Events of Default that may have occurred, the Indenture Trustee shall not
be bound to make any investigation into the facts or matters stated in any
resolution, certificate, statement, instrument, opinion, report, notice,
request, consent, order, approval, bond, or other paper or document, unless
requested in writing to do so by Holders of the Notes evidencing not less than
25% of the Outstanding Amount of the Notes; provided, however, that if the
payment within a reasonable time to the Indenture Trustee of the costs,
expenses, or liabilities likely to be incurred by it in the making of such
investigation shall be, in the opinion of the Indenture Trustee, not reasonably
assured to the Indenture Trustee by the security afforded to it by the terms of
this Indenture, the Indenture Trustee may require reasonable indemnity against
such cost, expense, or liability or payment of such expenses as a condition
precedent to so proceeding. The reasonable expense of every such examination
shall be paid by the Issuer or by the Servicer at the direction of the Issuer
or, if paid by the Indenture Trustee, shall be reimbursed by the Issuer or by
the Servicer at the direction of the Issuer upon demand. Nothing in this clause
(g) shall affect the obligation of the Issuer or the Servicer to observe any
applicable law prohibiting disclosure of information regarding the Obligors.
SECTION 6.3 Individual Rights of the Indenture Trustee. The Indenture
Trustee in its individual or any other capacity may become the owner or pledgee
of the Notes and may otherwise deal with the Issuer or its Affiliates with the
same rights it would have if it were not the Indenture Trustee. Any Paying
Agent, the 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.
<PAGE>
SECTION 6.4 The 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, shall not be accountable for the
Issuer's use of the proceeds from the Notes, and 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 6.5 Notice of Defaults. If a Default occurs and is continuing
and if it is either actually known or written notice of the existence thereof
has been delivered to a Responsible Officer of the Indenture Trustee, the
Indenture Trustee shall mail to each Noteholder notice of the Default within 90
days after such knowledge or notice occurs. Except in the case of a Default in
accordance with the provisions of Section 313(c) of the TIA 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 interest of the
Noteholders.
SECTION 6.6 Reports by the Indenture Trustee to Holders. Within the
prescribed period of time for tax reporting purposes after the end of each
calendar year during the term of this Indenture, the Indenture Trustee shall
deliver to each Noteholder such information as may be reasonably required to
enable such Holder to prepare its United States federal, state and local income
or franchise tax returns for such calendar year.
SECTION 6.7 Compensation and Indemnity. The Issuer shall cause the
Servicer pursuant to the Sale and Servicing Agreement 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 cause the Servicer pursuant
to the Sale and Servicing Agreement 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 Trustee's agents, counsel, accountants and experts.
The Issuer shall cause the Servicer pursuant to the Sale and Servicing Agreement
to indemnify the Indenture Trustee against any and all loss, liability or
expense (including the fees of either in-house counsel or outside counsel, but
not both) 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 Servicer promptly of any claim for which it may seek indemnity.
The Servicer'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
<PAGE>
occurrence of a Default specified in Section 5.1(d) 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 6.8 Replacement of the Indenture Trustee. (a) The Indenture
Trustee may give notice of its intent to 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 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.
(b) If the Indenture Trustee gives notice of its intent to resign or is
removed or if a vacancy exists in the office of the 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.
(c) A successor Indenture Trustee shall deliver a written acceptance of
its appointment to the retiring Indenture Trustee and to the Issuer and
thereupon the resignation or removal of the Indenture Trustee shall become
effective, and the successor Indenture Trustee, without any further act, deed or
conveyance 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 the Indenture Trustee to the successor
Indenture Trustee.
(d) If a successor Indenture Trustee does not take office within 60
days after the retiring Indenture Trustee gives notice of its intent to resign
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.
(e) 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.
<PAGE>
(f) Any resignation or removal of the Indenture Trustee and appointment
of a successor Indenture Trustee pursuant to any of the provisions of this
Section shall not become effective until acceptance of appointment by the
successor Indenture Trustee pursuant to Section 6.8(c) and payment of all fees
and expenses owed to the outgoing Indenture Trustee.
(g) Notwithstanding the resignation or removal of the Indenture Trustee
pursuant to this Section, the Issuer's and the Servicer's obligations under
Section 6.7 shall continue for the benefit of the retiring Indenture Trustee.
The Indenture Trustee shall not be liable for the acts or omissions of any
successor Indenture Trustee.
SECTION 6.9 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. The Indenture
Trustee shall provide the Issuer and 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 Indenture Trustee, and deliver such Notes so
authenticated; and in case at that time any of the Notes shall not have been
authenticated, any successor Indenture Trustee may authenticate such Notes
either in the name of any predecessor Indenture Trustee hereunder or in the name
of the successor Indenture Trustee; and in all such cases such certificate of
authentication shall have the same full force as is provided anywhere in the
Notes or in this Indenture with respect to the certificate of authentication of
the Indenture Trustee.
SECTION 6.10 Appointment of Co-Indenture Trustee or Separate Indenture
Trustee. (a) 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 Issuer 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 Issuer, and to vest in such Person
or Persons, in such capacity and for the benefit of the Noteholders, such title
to the Issuer, or any part hereof, and, subject to the other provisions of this
Section, such power, duties, obligations, rights and trusts as the Indenture
Trustee may consider necessary or desirable. The Administrator will pay all
reasonable fees and expenses of any co-trustee or co-trustees or separate
trustee or separate trustees. The appointment of any separate trustee or
co-trustee shall not absolve the Indenture
<PAGE>
Trustee of its obligations under this Indenture. No co-trustee or separate
trustee hereunder shall be required to meet the terms of eligibility as an
Indenture Trustee under Section 6.11, and no notice to the Noteholders of the
appointment of any co-trustee or separate trustee shall be required under
Section 6.8.
(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:
(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 Issuer or 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, including
acts or omissions of predecessor or successor trustees; 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 Indenture 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 (with a copy given to the Issuer).
(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 Indenture on its
<PAGE>
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. [(a)] The Indenture Trustee
shall at all times satisfy the requirements of TIA Section.310(a). The Indenture
Trustee shall have a combined capital and surplus of at least $100,000,000 as of
the last day of the most recent fiscal quarter for such institution and shall be
subject to examination or supervision by federal or state authorities. The
long-term unsecured debt of the Indenture Trustee shall at all times be rated
not lower than "BBB-" by Standard & Poor's and Fitch (if rated by Fitch) and
Baa3 by Moody's or such other ratings as are acceptable to the Rating Agencies.
The Indenture Trustee shall comply with TIA Section.310(b), including the
optional provision permitted by the second sentence of TIA Section.310(b)(9);
provided that there shall be excluded from the operation of TIA Section.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 the TIA
Section.310(b)(1) are met.
[(b)][If a Default occurs, the Indenture Trustee, within 90 days after
ascertaining the occurrence of such Default, shall resign with respect to the
Class A Notes and/or the Class B Notes in accordance with Section 6.8 of this
Indenture, and the Issuer shall appoint a successor Indenture Trustee for one or
both of such classes, as applicable, so that there will be separate Indenture
Trustees for the Class A Notes and the Class B Notes. In the event the Indenture
Trustee fails to comply with the terms of the preceding sentence, the Indenture
Trustee shall comply with TIA Sections.3.10(b)(ii) and (iii). The appointment
hereunder of a successor Trustee with respect to any class of Notes shall not
alter the voting rights of the Class A Noteholders and the Class B Noteholders
hereunder and under the Basic Documents. However, so long as any amounts remain
unpaid with respect to the Class A Notes, only the Indenture Trustee for the
Class A Noteholders shall have the right to exercise remedies under this
Indenture and the Basic Documents, to make deposits to and withdrawals from the
Trust Accounts, to make distributions to Noteholders from the Note Distribution
Account and to hold Reserve Account Property.
In the case of the appointment hereunder of a successor Indenture
Trustee with respect to any class of Notes pursuant to this Section 6.11(b), the
Issuer, the retiring Indenture Trustee and the successor Indenture Trustee with
respect to such class of Notes shall execute and deliver an indenture
supplemental hereto wherein each successor Indenture Trustee shall accept such
appointment and which (i) shall contain such provisions as shall be necessary or
desirable to transfer and confirm to, and to vest in, the successor Indenture
Trustee all the rights, powers, trusts and duties of the retiring Indenture
Trustee with respect to the Notes of the class to which the appointment of such
successor Indenture
<PAGE>
Trustee relates, (ii) if the retiring Indenture Trustee is not retiring with
respect to all classes of Notes, shall contain such provisions as shall be
deemed necessary or desirable to confirm that all the rights, powers, trusts and
duties of the retiring Indenture Trustee with respect to the Notes of each class
as to which the retiring Indenture Trustee is not retiring shall continue to be
vested in the Indenture Trustee, and (iii) shall add to or change any of the
provisions of this Indenture as shall be necessary to provide for or facilitate
the administration of the trusts hereunder by more than one Indenture Trustee,
it being understood that nothing herein or in such supplemental indenture shall
constitute such Indenture Trustees co-trustees of the same trust and that each
such Indenture Trustee shall be trustee of a trust or trusts hereunder separate
and apart from any trust or trusts hereunder administered by any other such
Indenture Trustee; and upon the removal of the retiring Indenture Trustee shall
become effective to the extent provided therein.]
SECTION 6.12 Preferential Collection of Claims Against the Issuer. The
Indenture Trustee shall comply with TIA Section.311(a), excluding any creditor
relationship listed in TIA Section.311(b). A Indenture Trustee who has resigned
or been removed shall be subject to TIA Section.311(a) to the extent indicated
therein.
ARTICLE VII
NOTEHOLDERS' LISTS AND REPORTS
SECTION 7.1 The Issuer To Furnish the Indenture Trustee Names and
Addresses of the Noteholders. The Issuer will furnish or cause to be furnished
to the Indenture Trustee (a) not more than five days after each Record Date, a
list, in such form as the Indenture Trustee may reasonably require, of the names
and addresses of the Holders as of such Record Date and (b) at such other times
as the Indenture Trustee may request in writing, within 14 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 that so
long as the Indenture Trustee is the Note Registrar, no such list shall be
required to be furnished.
SECTION 7.2 Preservation of Information; Communications to the
Noteholders. (a) 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 7.1 and the names and addresses of the Holders of Notes received by
the Indenture Trustee in its capacity as the Note Registrar. The Indenture
Trustee may destroy any list furnished to it as provided in such Section 7.1
upon receipt of a new list so furnished.
<PAGE>
(b) The Noteholders may communicate pursuant to TIA Section.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 Section.312(c).
SECTION 7.3 Reports by the Issuer. (a) The Issuer shall:
(i) file with the Indenture Trustee [and, for so long as any
Notes are listed thereon, the Luxembourg Stock Exchange,] 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) which the Issuer 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 for so long as any
Notes are listed thereon, the Luxembourg Stock Exchange,] 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
Section.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 7.3(a) as may be required 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 7.4 Reports by the Indenture Trustee. If required by TIA
Section.313(a), within 60 days after each March 31, beginning with March 31,
_____ the Indenture Trustee shall mail to each Noteholder as required by TIA
Section. 313(c) a brief report dated as of such date that complies with
TIA Section.313(a). The Indenture Trustee also shall comply with TIA
Section.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. On
each Distribution Date, the Indenture Trustee shall include with each payment to
each Noteholder a copy of the statement for the related Collection Period
provided to the Indenture Trustee pursuant to Section 5.8 of the Sale and
Servicing Agreement.
<PAGE>
ARTICLE VIII
ACCOUNTS, DISBURSEMENTS AND RELEASES
SECTION 8.1 Collection of Money. Except as otherwise 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 and the Sale and
Servicing Agreement. Except as otherwise 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.
SECTION 8.2 Trust Accounts. (a) On or prior to the Closing Date, the
Issuer shall cause the Servicer and the Seller to establish and maintain, in the
name of the Indenture Trustee, for the benefit of the Noteholders and/or the
Certificateholders, as applicable, the Trust Accounts as provided in Sections
5.1 and 5.6 of the Sale and Servicing Agreement.
(b) Before each Distribution Date, the Servicer and the Seller are
required to deposit the Total Distribution Amount with respect to the preceding
Collection Period in the Collection Account pursuant to Sections 5.2 and 5.4 of
the Sale and Servicing Agreement. On each Deposit Date, the Indenture Trustee
shall withdraw the Reserve Account Transfer Amount for the related Distribution
Date from the Reserve Account and deposit it in the Collection Account in
accordance with Section 5.5(b) of the Sale and Servicing Agreement. On or before
each Distribution Date, the Indenture Trustee or the Paying Agent on behalf of
the Indenture Trustee shall transfer the Noteholders' Distributable Amount for
such Distribution Date from the Collection Account to the Note Distribution
Account in accordance with Section 5.5(c) of the Sale and Servicing Agreement.
(c) Not later than 12:00 noon, New York City time, on each Distribution
Date, the Indenture Trustee or the Paying Agent on behalf of the Indenture
Trustee shall distribute all amounts on deposit in the Note Distribution Account
to the Noteholders to the extent of amounts due and unpaid on the Notes for
principal and interest in the following amounts and in the following order of
priority:
(i) to accrued and unpaid interest on the [Class A]
Notes; provided that if there are not sufficient funds in
<PAGE>
the Note Distribution Account to pay the entire amount of
accrued and unpaid interest then due on the [Class A] Notes,
the amount in the Note Distribution Account shall be applied
to the payment of such interest on the [Class A] Notes pro
rata on the basis of the total such interest due on the [Class
A] Notes;
[(ii) unless otherwise provided in clause (viii)
below, to accrued and unpaid interest on the Class B
Notes;]
(ii) [(iii)] unless otherwise provided in clause
(vii)[(viii)] below, to the Holders of the Class A-1 Notes
until the Outstanding Amount of the Class A-1 Notes is reduced
to zero;
(iii) [(iv)] unless otherwise provided in clause
(vii)[(viii)] below, to the Holders of the Class A-2 Notes
until the Outstanding Amount of the Class A-2 Notes is reduced
to zero;
(vi) [(v)] unless otherwise provided in clause
(vii)[(viii)] below, to the Holders of the Class A-3 Notes
until the Outstanding Amount of the Class A-3 Notes is reduced
to zero;
(v) [(vi)] unless otherwise provided in clause
(vii)[(viii)] below, to the Holders of the Class A-4 Notes
until the Outstanding Amount of the Class A-4 Notes is reduced
to zero; and
(vi)[(vii)] unless otherwise provided in clause
(vii)[(viii)] below, to the Holders of the Class [A-5][B]
Notes until the Outstanding Amount of the Class [A-5][B] Notes
is reduced to zero; and
(vii) [(viii)] if the Notes have been declared
immediately due and payable as provided in Section 5.2, any
amounts remaining in the Note Distribution Account after the
applications described in Section 8.2(c)(i) shall be applied
to the repayment of principal on each of the [Class A] Notes
pro rata on the basis of the respective unpaid principal
amount of each such [Class A] Note [, and any remaining
amounts will be distributed pursuant to clauses (ii) and (vii)
of Section 8.2, in that order].
[(d) Notwithstanding anything in this Section 8.2 to the contrary (but
subject to clause (vii) [viii] of Section 8.2(c)), if the Class A-1 Event has
occurred, amounts deposited into the Note Distribution Account with respect to
the Class A-1 Notes on the _________ Distribution Date with respect to the Class
A-1 Notes will distributed pursuant to clauses (i) and [(ii)] [(iii)] of Section
8.2(c) on such date, and amounts deposited into the Note
<PAGE>
Distribution Account with respect to the Class A-2, the Class A-3, the Class A-4
and the Class [A-5] [B] Notes on the applicable _________ Distribution Date with
respect to the Class A-2 Notes, the Class A-3 Notes, the Class A-4 Notes and the
Class [A-5] [B] Notes will be distributed pursuant to clauses (i), (iii) [(iv)],
(iv) [(v)], (v) [(vi)] and (vi) [(vii)] of Section 8.2(c).]
SECTION 8.3 General Provisions Regarding Accounts. (a) In accordance
with Section 5.1(b) and Section 5.6(b) of the Sale and Servicing Agreement, all
funds in the Collection Account and the Reserve Account shall be invested in
Permitted Investments upon written direction of the Servicer or the Seller, as
applicable. All income or other gain from investments of moneys deposited in
such Trust Accounts shall be paid as provided in the Sale and Servicing
Agreement, and any loss resulting from such investments shall be charged to such
account. The Servicer or the Seller, as applicable, will not direct the
Indenture Trustee to make any investment of any funds or to sell any investment
held in any of such Trust Accounts unless the security interest Granted and
perfected in such account will continue to be perfected in such investment or
the proceeds of such sale, in either case without any further action by any
Person, and, in connection with any direction to the Indenture Trustee to make
any such investment or sale, if requested by the Indenture Trustee, the Servicer
or the Seller, as applicable, shall deliver to the Indenture Trustee an Opinion
of Counsel, acceptable to the Indenture Trustee, to such effect.
(b) Subject to Section 6.1(b), the Indenture Trustee shall not in any
way be held liable by reason of any insufficiency in any of the Trust Accounts
resulting from any loss on any Permitted Investment included therein except for
losses attributable to the Indenture Trustee's failure to make payments on such
Permitted 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 Servicer or the Seller, as applicable, shall have failed
to give investment directions for any funds on deposit in the Collection Account
or the Reserve Account, as the case may be, to the Indenture Trustee by 11:00
a.m. New York City time (or such other time as may be agreed by the Servicer or
the Seller, as applicable, and the 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 5.2, or, if such Notes shall have been declared due and
payable following an Event of Default, amounts collected or receivable from the
Trust Estate are being applied in accordance with Section 5.5 as if there had
not been such a declaration, then the Indenture Trustee shall, to the fullest
extent practicable, invest and reinvest funds in such Trust Accounts in one or
more Permitted Investments. The Indenture Trustee shall not be liable for losses
in respect of such investments in Permitted Investments that comply with the
requirements of the Basic Documents except for losses attributable
<PAGE>
to the Indenture Trustee's failure to make payments on such Permitted
Investments issued by the Indenture Trustee, in its commercial capacity as
principal obligor and not as trustee, in accordance with their terms.
SECTION 8.4 Release of Trust Estate. (a) Subject to the payment of its
fees and expenses pursuant to Section 6.7, 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 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 6.7 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 Note Distribution
Account. The Indenture Trustee shall (i) release any remaining portion of the
Trust Estate [that secures the Certificates] from the lien of this Indenture and
(ii) release to the Issuer or any other Person entitled thereto any funds then
on deposit in the Reserve Account or the Collection Account only to such time as
(x) there are no Notes Outstanding[, (y) all payments in respect of Certificate
Balance and interest due to the Certificateholders have been paid in full] [(y)]
and (z) all sums due to the Indenture Trustee pursuant to Section 6.7 have been
paid. The Indenture Trustee shall release property from the lien of this
Indenture pursuant to this Section 8.4(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 Section.Section. 314(c) and
314(d)(1) meeting the applicable requirements of Section 11.1.
SECTION 8.5 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 8.4(a), accompanied by copies of any instruments involved,
and the Indenture Trustee may also require as a condition of 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 such action will not materially and
adversely impair the security for the Notes or the rights of the Noteholders;
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.
<PAGE>
ARTICLE IX
SUPPLEMENTAL INDENTURES
SECTION 9.1 Supplemental Indentures Without Consent of Noteholders. (a)
Without the consent of the Holders of any Notes but with prior notice to the
Rating Agencies [(and, for so long as any Notes are listed thereon, to the
Luxembourg Stock Exchange)] by the Issuer, when authorized by an Issuer Request,
the Issuer and the Indenture Trustee 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 which 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 materially and 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; [and]
(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
<PAGE>
similar federal statute hereafter enacted and to add to this Indenture
such other provisions as may be expressly required by the TIA[; and][.]
[(viii) to affect the appointment of a successor Indenture
Trustee in accordance with Section 6.11(b).]
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.
(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 [(and for so long as any Notes are listed
thereon, to the Luxembourg Stock Exchange)] by the Issuer, as evidenced to 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
that such action shall not, as evidenced by an Opinion of Counsel, materially
and adversely affect the interests of any Noteholder.
SECTION 9.2 Supplemental Indentures with Consent of the Noteholders.
The Issuer and the Indenture Trustee, when authorized by the Issuer, also may,
with prior notice to the Rating Agencies [(and for so long as any Notes are
listed thereon, to the Luxembourg Stock Exchange)] and with the consent of the
Holders of 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 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 provision 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
<PAGE>
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 sell or liquidate the
Trust Estate pursuant to Section 5.4;
(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 any of the other Basic Documents cannot
be modified or waived without the consent of the Holder of each
Outstanding Note affected thereby;
(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 the 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
or in the Basic Documents, 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 determine whether 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 Noteholders under this Section to
approve the particular form of any proposed supplemental indenture, but it shall
be sufficient if such Noteholders shall approve the substance thereof.
<PAGE>
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 9.3 Effect of Supplemental Indenture. Upon the execution of any
supplemental indenture pursuant to the provisions hereof, this Indenture shall
be and 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 an be deemed to be part of the terms and
conditions of this Indenture and the Notes affected thereby for any and all
purposes.
SECTION 9.4 Conformity with Trust Indenture Act. Every amendment of
this Indenture and every supplemental indenture executed pursuant to this
Article IX shall comply in all respects with the TIA.
SECTION 9.5 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 require, 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.
SECTION 9.6 Execution of Supplemental Indentures. In executing, or
accepting the additional trusts created by, any supplemental indenture permitted
by this Article IX or the modifications thereby of the trusts created by this
Indenture the Indenture Trustee shall be entitled to receive, and (subject to
Section 6.1) 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 which affects the
Indenture Trustee's own rights, duties or immunities under this Indenture or
otherwise.
<PAGE>
ARTICLE X
REDEMPTION OF NOTES
SECTION 10.1 Redemption. The Class A-[5][4] Notes [and the Class B
Notes] are subject to redemption in whole, but not in part, on any Distribution
Date upon the exercise by the Servicer of its option to purchase the Receivables
pursuant to Section 9.1(a) of the Sale and Servicing Agreement. The Notes shall
be redeemed for the Redemption Price; provided that the Issuer has available
funds sufficient to pay the Redemption Price. The Servicer shall furnish notice
of such election to the Indenture Trustee and the Note Registrar not later than
the 25th day of the month prior to the Redemption Date and the Issuer shall
deposit or cause the Servicer to deposit with the Indenture Trustee in the
Collection Account the Redemption Price of [(i)] the Class A-5 Notes to be
redeemed [and (ii) the Class B Notes to be redeemed], whereupon all such Class
A- 5 Notes [and Class B Notes] shall be due and payable on the Redemption Date.
SECTION 10.2 Form of Redemption Notice. Notice of redemption under
Section 10.1 shall be given by the Indenture Trustee by facsimile or by
first-class mail, postage prepaid, transmitted or mailed prior to the applicable
Redemption Date to each Holder of Class A-5 Notes [and Class B] Notes [(and, for
so long as any Notes are listed thereon, to the Luxembourg Stock Exchange)], as
of the close of business on the Record Date preceding the applicable Redemption
Date, at such Holder's address appearing in the Note Register.
All notices of redemption shall state:
(i) the Redemption Date;
(ii) the Redemption Price;
(iii) that the Record Date otherwise applicable to such
Distribution Date is not applicable and that payments shall be made
only upon presentation and surrender of such Class A-5 [and Class B]
Notes and the place where such Class A-5 [and Class B] Notes are to be
surrendered for payment of the Redemption Price (which shall be the
office or agency to be maintained as provided in Section 3.2); and
(iv) that interest on the Class A-5 [and Class B] Notes shall
cease to accrue on the Redemption Date.
Notice of redemption of the Class A-5 [and Class B] 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 Class A-5 [and Class B] Notes shall not impair or affect the validity of the
redemption of any other Class A-5 [or Class B] Note.
<PAGE>
SECTION 10.3 Notes Payable on Redemption Date. The Notes to be redeemed
shall, following notice of redemption as required by Section 10.2, 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 11.1 Compliance Certificates and Opinions, etc. (a) 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 or other experts 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:
(i) 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;
(ii) 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;
(iii) 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 such covenant or condition has been complied with; and
(iv) 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
<PAGE>
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 11.1(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), 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) 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) Other than with respect to the release of any
Repurchased Receivables or Defaulted Receivables, 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), 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 Repurchased
Receivables and Defaulted Receivables, 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) 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
<PAGE>
$25,000 or less than one percent of the then Outstanding
Amount of the Notes.
(v) Notwithstanding Section 2.9 or any provision of this
Section, the Issuer may (A) collect, liquidate, sell or otherwise
dispose of the Receivables as and to the extent permitted or required
by the Basic Documents and (B) make cash payments out of the Trust
Accounts as and to the extent permitted or required by the Basic
Documents.
SECTION 11.2 Form of Documents Delivered to the 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 my 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 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 his or her 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 or the
Issuer, stating that the information with respect to such factual matters is in
the possession of the Servicer, the Seller or the Issuer, 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,
certificate or report to the Indenture Trustee, it is provided that the Issuer
shall deliver any document (x) as a condition of the granting of such
application, or (y) 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 each 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,
<PAGE>
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 11.3 Actions of Noteholders.
(a) Any request, demand, authorization, direction, notice, consent,
waiver or other action provided by this Indenture to be given or taken by the
Noteholders may be embodied in and evidenced by one or more instruments of
substantially similar tenor signed by such Noteholders in person or by an agent
duly appointed in writing; and except as herein otherwise expressly provided,
such action shall become effective when such instrument or instruments are
delivered to the Indenture Trustee and, when required, to the Issuer or the
Servicer. Proof of execution of any such instrument or of a writing appointing
any such agent shall be sufficient for any purpose of this Indenture and
conclusive in favor of the Indenture Trustee, the Issuer and the Servicer, if
made in the manner provided in this Section 11.3.
(b) The fact and date of the execution by any Noteholder of any such
instrument or writing may be proved in any reasonable manner which the Indenture
Trustee deems sufficient.
(c) Any request, demand, authorization, direction, notice, consent,
waiver or other act by a Noteholder shall bind every Holder of every Note issued
upon the registration of transfer thereof or in exchange therefor or in lieu
thereof, in respect of anything done, or omitted to be done, by the Indenture
Trustee, the Issuer or the Servicer in reliance thereon, regardless of whether
notation of such action is made upon such Note.
(d) The Indenture Trustee may require such additional proof of any
matter referred to in this Section 11.3 as it shall deem necessary.
SECTION 11.4 Notices, etc., to the Indenture Trustee, the 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 to be made upon, given or furnished to or filed with:
(a) The Indenture Trustee by any Noteholder or by the Issuer
shall be sufficient for every purpose hereunder if personally delivered
or mailed certified mail, return receipt requested and shall be deemed
to have been duly given upon receipt by the Indenture Trustee at its
Corporate Trust Office, or
(b) The Issuer by the Indenture Trustee or any Noteholder
shall be sufficient for every purpose hereunder if personally delivered
or mailed certified mail, return receipt to the Issuer addressed to:
Chase Manhattan Auto Owner Trust 199-_, in care of [______________] or
at any other address
<PAGE>
previously furnished in writing to the Indenture Trustee by
the Issuer. The Issuer shall promptly transmit any notice
received by it from the Noteholders to the Indenture
Trustee.[, or]
[(c) The Luxembourg Stock Exchange by the Indenture
Trustee shall be sufficient for every purpose hereunder if in
writing and sent by overnight courier to the Principal Paying
Agent addressed to: Banque Generale du Luxembourg, S.A., 50
Avenue J.F. Kennedy, L-2951 Luxembourg.]
Notices required to be given to the Rating Agencies by the Issuer, the
Indenture Trustee or the Owner Indenture Trustee shall be in writing, personally
delivered or mailed certified mail, return receipt requested to (i) in the case
of Moody's, at the following address: Moody's Investors Service, 99 Church
Street, New York, New York 10004, (ii) in the case of S&P, at the following
address: Standard & Poor's Ratings Service, 26 Broadway (15th Floor), New York,
New York 10004, Attention of Asset Backed Surveillance Department and (iii) in
the case of Fitch Investors Service, L.P., at the following address: Fitch
Investors Service, L.P., One State Street Plaza, 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 11.5 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 [(i) so long
as any Notes are listed on the Luxembourg Stock Exchange, such notice is
published in an Authorized Newspaper and (ii) such notice is sent] in writing
and mailed, first-class, postage prepaid to each Noteholder affected by such
event, at his 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
<PAGE>
shall be impractical to mail notice of any event to the 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 right or obligations
created hereunder, and shall not under any circumstance constitute a Default or
Event of Default.
SECTION 11.6 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, provided that such methods are reasonable and consented to
by the Indenture Trustee (which consent shall not be unreasonably withheld). 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 11.7 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 TIA, such required
provision shall control.
The provisions of TIA Section.Section. 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 11.8 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 11.9 Successors and Assigns. All covenants and agreements in
this Indenture and the Notes by the Issuer shall bind its successors and
assigns. All agreements of the Indenture Trustee in this Indenture shall bind
its successors.
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 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 (only to the
extent expressly
<PAGE>
provided herein) the Certificateholders, 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
GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE
LAWS OF THE STATE OF NEW YORK.
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 or to satisfy any provision of the TIA.
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, 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
Articles VI, VII and VIII of the Trust Agreement.
<PAGE>
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 Issuer or join in any
institution against 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 other 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.
<PAGE>
IN WITNESS WHEREOF, the Issuer and the Indenture Trustee have caused
this Indenture to be duly executed by their respective officers, thereunto duly
authorized, all as of the day and year first above written.
CHASE MANHATTAN AUTO OWNER TRUST 199_-_
By: ___________________________________________,
not in its individual
capacity but solely as
Owner Trustee
By: ____________________________________________
Name:
Title:
______________________,
not in its individual capacity
but solely as Indenture Trustee
By: ___________________________________________,
Name:
Title:
<PAGE>
EXHIBIT A
SCHEDULE OF RECEIVABLES
Delivered to the Owner Trustee and the Indenture Trustee
on the Closing Date.
<PAGE>
EXHIBIT B
FORM OF A-1 NOTES
REGISTERED $________________3/
No. R-____ CUSIP NO. ___________
[UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE ISSUER OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY NOTE ISSUED IS
REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO
SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY
TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON
IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN.]
THE PRINCIPAL OF THIS NOTE IS PAYABLE IN INSTALLMENTS AS SET
FORTH HEREIN. ACCORDINGLY, THE OUTSTANDING PRINCIPAL AMOUNT OF
THIS NOTE AT ANY TIME MAY BE LESS THAN THE AMOUNT SHOWN ON THE FACE
HEREOF.
CHASE MANHATTAN AUTO OWNER TRUST 199_-
_____% CLASS A-1 ASSET BACKED NOTES
Chase Manhattan Auto Owner Trust 199_-, a trust organized and existing
under the laws of the State of Delaware (including any successor, the "Issuer"),
for value received, hereby promises to pay to CEDE & CO., or its registered
assigns, the principal sum of __________________________________________ DOLLARS
($______________), partially 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 Note Distribution Account in respect
of principal on the Class A-1 Notes pursuant to Section 3.1 of the Indenture;
[provided that the entire unpaid principal amount of this Note shall be due and
payable on the earlier of the _____ ____ Distribution Date (which is ________,
199_)] and the Redemption Date, if any, pursuant to Section 10.1 of the
Indenture. 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 Sections 2.7, 3.1 and 8.2 of the Indenture. Interest on
this Note will accrue for each Distribution
___________________________
3 Denominations of $1,000 and integral multiples of $1,000 in
excess thereof.
<PAGE>
Date from the most recent Distribution Date on which interest has been paid to
but excluding the then current Distribution Date or, if no interest has yet been
paid, from ________, 199_. Interest will be computed on the basis of actual days
elapsed in a 360-day year [(which is __ days in the case of _____ 199_
Distribution Date)]. Such principal of and interest on this Note shall be paid
in the manner specified in the Indenture.
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 referred to on the
reverse hereof, 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.
Dated: __________, 199_
CHASE MANHATTAN AUTO OWNER TRUST 199_-_
By: ___________________________________________,
not in its individual
capacity but solely as Owner Trustee
under the Trust Agreement
By: ____________________________________________
Name:
Title:
<PAGE>
INDENTURE TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Notes designated above and referred to in the within
mentioned Indenture.
Dated: ________ __, 199_
____________________________________,
____________________________________
not in its individual capacity
but solely as Indenture Trustee
By: ________________________________
Authorized Signatory
<PAGE>
[REVERSE OF NOTE]
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" or the "Notes"), all issued under an Indenture dated as of
___________, 199_ (such Indenture, as supplemented or amended, is herein called
the "Indenture"), between the Issuer and ______________________,
____________________, not in its individual capacity but solely as trustee (the
"Indenture Trustee", which term includes any successor Indenture Trustee 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 Notes are subject to all terms of the Indenture. All terms used
in this Note that are not otherwise defined herein and that are defined in the
Indenture shall have the meanings assigned to them in or pursuant to the
Indenture.
The Notes and the Class A-2 Notes, Class A-3 Notes [,][and] Class A-4
Notes [and the Class A-5 Notes] are and will be equally and ratably secured by
the collateral pledged as security therefor [and the Class B Notes are
subordinate to the Class A Notes, in each case] as provided in the Indenture.
The Issuer shall pay interest on overdue installments of interest at
the Class A-1 Interest Rate to the extent lawful.
Each Holder or Note Owner, by acceptance of a Note, or, in the case of
a Note Owner, a beneficial interest in the 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
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.
It is the intent of the Seller, the Servicer, the Noteholders and the
Note Owners[,[ [and] the Issuer[, the Certificateholders and the Certificate
Owners] that the Notes will be classified as
<PAGE>
indebtedness of the Issuer for all United States tax purposes. The Noteholders,
by acceptance of a Note, agree to treat, and to take no action inconsistent with
the treatment of, the Notes as indebtedness of the Issuer for such tax purposes.
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 they
will not at any time institute against the Issuer, or join in any institution
against 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 other Basic Documents.
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.
Anything herein to the contrary notwithstanding, except as expressly
provided in the Basic Documents, neither Chase Manhattan Bank USA, National
Association in its individual capacity, any owner of a beneficial interest in
the Issuer, nor any of their respective partners, beneficiaries, agents,
officers, directors, employees, 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, or performance of, or omission to perform, any of the covenants,
obligations or indemnifications contained in this Note or the Indenture, it
being expressly understood that said covenants, obligations and indemnifications
have been made by the Indenture Trustee for the sole purpose of binding the
interests of the Indenture Trustee in the assets of the Issuer. The Holder of
this Note by the 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 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.
<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, to transfer
said Note on the books kept for registration thereof, with full power of
substitution in the premises.
Dated: _________________ ______________________________________________****
Signature Guaranteed:
_______________________
**** NOTE: 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
whatsoever.
<PAGE>
EXHIBIT C
FORM OF A-2 NOTES
REGISTERED $________________1/
No. R-______ CUSIP NO. _________
[UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE ISSUER OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY NOTE ISSUED IS
REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO
SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY
TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON
IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN.]
THE PRINCIPAL OF THIS NOTE IS PAYABLE IN INSTALLMENTS AS SET FORTH
HEREIN. ACCORDINGLY, THE OUTSTANDING PRINCIPAL AMOUNT OF THIS NOTE AT ANY
TIME MAY BE LESS THAN THE AMOUNT SHOWN ON THE FACE HEREOF.
CHASE MANHATTAN AUTO OWNER TRUST 199_-
_____% CLASS A-2 ASSET BACKED NOTES
Chase Manhattan Auto Owner Trust 199_-, a trust organized and existing
under the laws of the State of Delaware (including any successor, the "Issuer"),
for value received, hereby promises to pay to CEDE & CO., or its registered
assigns, the principal sum of
_____________________________________________ DOLLARS ($____________), partially
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 the (ii) the aggregate amount, if any,
payable from the Note Distribution Account in respect of principal on the Class
A-2 Notes pursuant to Section 3.1 of the Indenture; provided that the entire
unpaid principal amount of this Note shall be due and payable on the earlier of
the _______ ____ Distribution Date and the Redemption Date, if any, pursuant to
Section 10.1 of the Indenture. No payments of principal of the Class A-2 Notes
will be made until the principal of the Class A-1 Notes has been paid in full.
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 Sections 2.7, 3.1 and 8.2 of the Indenture. Interest on this Note
__________________
1/ Denominations of $1,000 and integral multiples of $1,000 in excess thereof.
<PAGE>
will accrue for each Distribution Date from the most recent Distribution Date on
which interest has been paid to but excluding the then current Distribution Date
or, if no interest has yet been paid, from _____ __, ____. 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 in the
Indenture.
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 referred to on the
reverse hereof, 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.
Dated: _________________ __, 199_
CHASE MANHATTAN AUTO OWNER TRUST
199_
By: ________________________,
not in its individual capacity but
solely as Owner Trustee under the
Trust Agreement
By: ____________________________________
Name: ______________________________
Title: _____________________________
<PAGE>
INDENTURE TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Notes designated above and referred to in the
within-mentioned Indenture.
Dated: _________________ __, 199_
________________________________________
_____________, not in its individual
capacity, but solely as Indenture
Trustee
By: ____________________________________
Authorized Signatory
<PAGE>
[REVERSE OF NOTE]
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" or the "Notes"), all issued under an Indenture dated as of ________
__, ____ (such Indenture, as supplemented or amended, is herein called the
"Indenture"), between the Issuer and ______________________, ________
___________, not in its individual capacity but solely as trustee (the
"Indenture Trustee", which term includes any successor Indenture Trustee 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 Notes are subject to all terms of the Indenture. All terms used
in this Note that are not otherwise defined herein and that are defined in the
Indenture shall have the meanings assigned to them in or pursuant to the
Indenture.
The Notes and the Class A-1 Notes, Class A-3 Notes[,][and] Class A-4
Notes [and the Class A-5 Notes] are and will be equally and ratably secured by
the collateral pledged as security therefor [and the Class B Notes are
subordinate to the Class A Notes, in each case] as provided in the Indenture.
The Issuer shall pay interest on overdue installments of interest at
the Class A-2 Interest Rate to the extent lawful.
Each Holder or Note Owner, by acceptance of a Note, or, in the case of
a Note Owner, a beneficial interest in the 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
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 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 Indenture Trustee or the
Owner 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.
It is the intent of the Seller, the Servicer, the Noteholders, the Note
Owners[,] [and] the Issuer[, the Certificateholders and the Certificate Owners]
that the Notes will be classified as
<PAGE>
indebtedness of the Issuer for all United States tax purposes. The Noteholders,
by acceptance of a Note, agree to treat, and to take no action inconsistent with
the treatment of, the Notes as indebtedness of the Issuer for such tax purposes.
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 they
will not at any time institute against the Issuer, or join in any institution
against 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 other Basic Documents.
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.
Anything herein to the contrary notwithstanding, except as expressly
provided in the Basic Documents, neither Chase Manhattan Bank USA, National
Association, in its individual capacity, any owner of a beneficial interest in
the Issuer, nor any of their respective partners, beneficiaries, agents,
officers, directors, employees, 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, or performance of, or omission to perform, any of the covenants,
obligations or indemnifications contained in this Note or the Indenture, it
being expressly understood that said covenants, obligations and indemnifications
have been made by the Indenture Trustee for the sole purpose of binding the
interests of the Indenture Trustee in the assets of the Issuer. The Holder of
this Note by the 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 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.
<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, to transfer said Note on
the books kept for registration thereof, with full power of substitution in the
premises.
Dated: ______________________ _______________________________________*/
Signature Guaranteed:
_________________________________________
_______________________
*/ NOTE: 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
whatsoever.
<PAGE>
EXHIBIT D
FORM OF A-3 NOTES
REGISTERED $_____________1/
No. R-__________ CUSIP NO. _________
[UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE ISSUER OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY NOTE ISSUED IS
REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO
SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY
TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON
IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN.]
THE PRINCIPAL OF THIS NOTE IS PAYABLE IN INSTALLMENTS AS SET FORTH
HEREIN. ACCORDINGLY, THE OUTSTANDING PRINCIPAL AMOUNT OF THIS NOTE AT ANY
TIME MAY BE LESS THAN THE AMOUNT SHOWN ON THE FACE HEREOF.
CHASE MANHATTAN AUTO OWNER TRUST 199_-
_____% CLASS A-3 ASSET BACKED NOTES
Chase Manhattan Auto Owner Trust 199_-, a trust organized and existing
under the laws of the State of Delaware (including any successor, the "Issuer"),
for value received, hereby promises to pay to [CEDE & CO.], or its registered
assigns, the principal sum of ___________________________________________
DOLLARS ($_______________), partially 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 the (ii) the aggregate amount, if any, payable from the Note
Distribution Account in respect of principal on the Class A-3 Notes pursuant to
Section 3.1 of the Indenture; provided that the entire unpaid principal amount
of this Note shall be due and payable on the earlier of the ________ ____
Distribution Date and the Redemption Date, if any, pursuant to Section 10.1 of
the Indenture. No payments of principal of the Class A-3 Notes will be made
until the principal of the Class A-1 Notes and the Class A-2 Notes have been
paid in full. 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 Sections 2.7, 3.1 and 8.2 of the
_____________________
1/ Denominations of $1,000 and integral multiples of $1,000 in excess
thereof.
<PAGE>
Indenture. Interest on this Note will accrue for each Distribution Date from the
most recent Distribution Date on which interest has been paid to but excluding
the then current Distribution Date or, if no interest has yet been paid, from
_____ __, ____. 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 in the Indenture.
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 referred to on the
reverse hereof, 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.
Dated: ____________________ __, 199_
CHASE MANHATTAN AUTO OWNER TRUST
199_-
By: ________________________,
not in its individual capacity but
solely as Owner Trustee under the
Trust Agreement
By: ___________________________________
Name: _____________________________
Title: ____________________________
<PAGE>
INDENTURE TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Notes designated above and referred to in the
within-mentioned Indenture.
Dated: _________________ __, 199_
_________________________________________
___________, not in its individual
capacity, but solely as Indenture
Trustee
By: _____________________________________
Authorized Signatory
<PAGE>
[REVERSE OF NOTE]
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" or the "Notes"), all issued under an Indenture dated as of ________
__, ____ (such Indenture, as supplemented or amended, is herein called the
"Indenture"), between the Issuer and ______________________, ________
___________, not in its individual capacity but solely as trustee (the
"Indenture Trustee", which term includes any successor Indenture Trustee 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 Notes are subject to all terms of the Indenture. All terms used
in this Note that are not otherwise defined herein and that are defined in the
Indenture shall have the meanings assigned to them in or pursuant to the
Indenture.
The Notes and the Class A-1 Notes, Class A-2 Notes[,][and] Class A-4
Notes [and the Class A-5 Notes] are and will be equally and ratably secured by
the collateral pledged as security therefor [and the Class B Notes are
subordinate to the Class A Notes, in each case] as provided in the Indenture.
The Issuer shall pay interest on overdue installments of interest at
the Class A-3 Interest Rate to the extent lawful.
Each Holder or Note Owner, by acceptance of a Note, or, in the case of
a Note Owner, a beneficial interest in the 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
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 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 Indenture Trustee or the
Owner 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.
It is the intent of the Seller, the Noteholders, the Note Owners[,]
[and] the Issuer[, the Certificateholders and the Certificate Owners] that, the
Notes will be classified as
<PAGE>
indebtedness of the Issuer for all United States tax purposes. The Noteholders,
by acceptance of a Note, agree to treat, and to take no action inconsistent with
the treatment of, the Notes as indebtedness of the Issuer for such tax purposes.
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 they
will not at any time institute against the Issuer, or join in any institution
against 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 other Basic Documents.
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.
Anything herein to the contrary notwithstanding, except as expressly
provided in the Basic Documents, neither Chase Manhattan Bank USA, National
Association, in its individual capacity, any owner of a beneficial interest in
the Issuer, nor any of their respective partners, beneficiaries, agents,
officers, directors, employees, 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, or performance of, or omission to perform, any of the covenants,
obligations or indemnifications contained in this Note or the Indenture, it
being expressly understood that said covenants, obligations and indemnifications
have been made by the Indenture Trustee for the sole purpose of binding the
interests of the Indenture Trustee in the assets of the Issuer. The Holder of
this Note by the 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 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.
<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, to transfer said Note on
the books kept for registration thereof, with full power of substitution in the
premises.
Dated: ______________________ _______________________________________*/
Signature Guaranteed:
_________________________________________
___________________
*/ NOTE: 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
whatsoever.
<PAGE>
EXHIBIT E
FORM OF A-4 NOTES
REGISTERED $_____________*/
No. R-________ CUSIP NO. _________
[UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE ISSUER OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY NOTE ISSUED IS
REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO
SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY
TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON
IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN.]
THE PRINCIPAL OF THIS NOTE IS PAYABLE IN INSTALLMENTS AS SET FORTH
HEREIN. ACCORDINGLY, THE OUTSTANDING PRINCIPAL AMOUNT OF THIS NOTE AT ANY
TIME MAY BE LESS THAN THE AMOUNT SHOWN ON THE FACE HEREOF.
CHASE MANHATTAN AUTO OWNER TRUST 199_-
_____% CLASS A-4 ASSET BACKED NOTES
Chase Manhattan Auto Owner Trust 199_-, a trust organized and existing
under the laws of the State of Delaware (including any successor, the "Issuer"),
for value received, hereby promises to pay to [CEDE & CO.], or its registered
assigns, the principal sum of DOLLARS ($ ), partially 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 the (ii) the aggregate amount, if any, payable from the Note
Distribution Account in respect of principal on the Class A-4 Notes pursuant to
Section 3.1 of the Indenture; provided that the entire unpaid principal amount
of this Note shall be due and payable on the earlier of the ____ ____
Distribution Date and the Redemption Date, if any, pursuant to Section 10.1 of
the Indenture. No payments of principal of the Class A-4 Notes will be made
until the principal of the Class A-1 Notes, the Class A-2 Notes and the Class
A-3 Notes have been paid in full. 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 Sections 2.7, 3.1 and 8.2 of the
_______________
*/ Denominations of $1,000 and integral multiples of $1,000 in excess thereof.
<PAGE>
Indenture. Interest on this Note will accrue for each Distribution Date from the
most recent Distribution Date on which interest has been paid to but excluding
the then current Distribution Date or, if no interest has yet been paid, from
_____ __, 199_. 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 in the Indenture.
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 referred to on the
reverse hereof, 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.
Dated: ______________________ __, 199_
CHASE MANHATTAN AUTO OWNER TRUST
199_-
By: ________________________,
not in its individual capacity but
solely as Owner Trustee under the
Trust Agreement
By: __________________________________
Name: ____________________________
Title: ___________________________
<PAGE>
INDENTURE TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Notes designated above and referred to in the
within-mentioned Indenture.
Dated: ________________ __, 199_
_________________________________________
___________, not in its individual
capacity, but solely as Indenture
Trustee
By: _____________________________________
Authorized Signatory
<PAGE>
[REVERSE OF NOTE]
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" or the "Notes"), all issued under an Indenture dated as of ________
__, 199_ (such Indenture, as supplemented or amended, is herein called the
"Indenture"), between the Issuer and ______________________, ________
___________, not in its individual capacity but solely as trustee (the
"Indenture Trustee", which term includes any successor Indenture Trustee 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 Notes are subject to all terms of the Indenture. All terms used
in this Note that are not otherwise defined herein and that are defined in the
Indenture shall have the meanings assigned to them in or pursuant to the
Indenture.
The Notes and the Class A-1 Notes, Class A-2 Notes[,][and] Class A-3
Notes [and the Class A-5 Notes] are and will be equally and ratably secured by
the collateral pledged as security therefor [and the Class B Notes are
subordinate to the Class A Notes, in each case] as provided in the Indenture.
The Issuer shall pay interest on overdue installments of interest at
the Class A-4 Interest Rate to the extent lawful.
Each Holder or Note Owner, by acceptance of a Note, or, in the case of
a Note Owner, a beneficial interest in the 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
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 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 Indenture Trustee or the
Owner 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
Indenture 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.
It is the intent of the Seller, the Servicer, the Noteholders, the Note
Owners[,] [and] the Issuer[, the Certificateholders and the Certificate Owners]
that, the Notes will be classified as
<PAGE>
indebtedness of the Issuer for all United States tax purposes. The Noteholders,
by acceptance of a Note, agree to treat, and to take no action inconsistent with
the treatment of, the Notes for such tax purposes as indebtedness of the Issuer.
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 they
will not at any time institute against the Issuer, or join in any institution
against 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 other Basic Documents.
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.
Anything herein to the contrary notwithstanding, except as expressly
provided in the Basic Documents, neither Chase Manhattan Bank USA, National
Association, in its individual capacity, any owner of a beneficial interest in
the Issuer, nor any of their respective partners, beneficiaries, agents,
officers, directors, employees, 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, or performance of, or omission to perform, any of the covenants,
obligations or indemnifications contained in this Note or the Indenture, it
being expressly understood that said covenants, obligations and indemnifications
have been made by the Indenture Trustee for the sole purpose of binding the
interests of the Indenture Trustee in the assets of the Issuer. The Holder of
this Note by the 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 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.
<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, to transfer said Note on
the books kept for registration thereof, with full power of substitution in the
premises.
Dated: __________________________ _______________________________________*/
Signature Guaranteed:
_________________________________________
___________________
*/ NOTE: 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 whatsoever.
<PAGE>
[EXHIBIT F]
[FORM OF A-5 NOTES]
REGISTERED $_______________*/
No. R-_______ CUSIP NO. _________
[UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE ISSUER OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY NOTE ISSUED IS
REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO
SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY
TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON
IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN.]
THE PRINCIPAL OF THIS NOTE IS PAYABLE IN INSTALLMENTS AS SET FORTH
HEREIN. ACCORDINGLY, THE OUTSTANDING PRINCIPAL AMOUNT OF THIS NOTE AT ANY
TIME MAY BE LESS THAN THE AMOUNT SHOWN ON THE FACE HEREOF.
CHASE MANHATTAN AUTO OWNER TRUST 199_-
_____% CLASS A-5 ASSET BACKED NOTES
Chase Manhattan Auto Owner Trust 199_-, a trust organized and existing
under the laws of the State of Delaware (including any successor, the "Issuer"),
for value received, hereby promises to pay to [CEDE & CO.], or its registered
assigns, the principal sum of DOLLARS ($ ), partially 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 the (ii) the aggregate amount, if any, payable from the Note
Distribution Account in respect of principal on the Class A-5 Notes pursuant to
Section 3.1 of the Indenture; provided that the entire unpaid principal amount
of this Note shall be due and payable on the earlier of the ____ ____
Distribution Date and the Redemption Date, if any, pursuant to Section 10.1 of
the Indenture. No payments of principal of the Class A-5 Notes will be made
until the principal of the Class A-1 Notes, the Class A-2 Notes, Class A-3 Notes
and the Class A-4 Notes have been paid in full. 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 Sections 2.7,
________________
*/ Denominations of $1,000 and integral multiples of $1,000 in excess thereof.
<PAGE>
3.1 and 8.2 of the Indenture. Interest on this Note will accrue for each
Distribution Date from the most recent Distribution Date on which interest has
been paid to but excluding the then current Distribution Date or, if no interest
has yet been paid, from _____ __, 199_. 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 in the Indenture.
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 referred to on the
reverse hereof, 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.
Dated: ____________________ __, 199_
CHASE MANHATTAN AUTO OWNER TRUST
199_-
By: ________________________,
not in its individual capacity but
solely as Owner Trustee under the
Trust Agreement
By: __________________________________
Name: ____________________________
Title: ___________________________
<PAGE>
INDENTURE TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Notes designated above and referred to in the
within-mentioned Indenture.
Dated: _____________ __, 199_
_______________________________________
___________, not in its individual
capacity, but solely as Indenture
Trustee
By: __________________________________
Authorized Signatory
<PAGE>
[REVERSE OF NOTE]
This Note is one of a duly authorized issue of Notes of the Issuer,
designated as its _____% Class A-5 Asset Backed Notes (herein called the "Class
A-5 Notes" or the "Notes"), all issued under an Indenture dated as of ________
__, 199_ (such Indenture, as supplemented or amended, is herein called the
"Indenture"), between the Issuer and ______________________, ________
___________, not in its individual capacity but solely as trustee (the
"Indenture Trustee", which term includes any successor Indenture Trustee 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 Notes are subject to all terms of the Indenture. All terms used
in this Note that are not otherwise defined herein and that are defined in the
Indenture shall have the meanings assigned to them in or pursuant to the
Indenture.
The Notes and the Class A-1 Notes, Class A-2 Notes, Class A-3 Notes and
Class A-4 Notes are and will be equally and ratably secured by the collateral
pledged as security therefor [and the Class B Notes are subordinate to the Class
A Notes, in each case] as provided in the Indenture.
The Issuer shall pay interest on overdue installments of interest at
the Class A-5 Interest Rate to the extent lawful.
Each Holder or Note Owner, by acceptance of a Note, or, in the case of
a Note Owner, a beneficial interest in the 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
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 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 Indenture Trustee or the
Owner 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.
It is the intent of the Seller, the Servicer, the Noteholders, the Note
Owners, the Issuer[,] [and] [the Certificateholders and the Certificate Owners]
that, the Notes will be classified as
<PAGE>
indebtedness of the Issuer for all United States tax purposes. The Noteholders,
by acceptance of a Note, agree to treat, and to take no action inconsistent with
the treatment of, the Notes for such tax purposes as indebtedness of the Issuer.
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 they
will not at any time institute against the Issuer, or join in any institution
against 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 other Basic Documents.
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.
Anything herein to the contrary notwithstanding, except as expressly
provided in the Basic Documents, neither Chase Manhattan Bank USA, National
Association, in its individual capacity, any owner of a beneficial interest in
the Issuer, nor any of their respective partners, beneficiaries, agents,
officers, directors, employees, 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, or performance of, or omission to perform, any of the covenants,
obligations or indemnifications contained in this Note or the Indenture, it
being expressly understood that said covenants, obligations and indemnifications
have been made by the Indenture Trustee for the sole purpose of binding the
interests of the Indenture Trustee in the assets of the Issuer. The Holder of
this Note by the 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 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.
<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, to transfer said Note on
the books kept for registration thereof, with full power of substitution in the
premises.
Dated: _______________________ ________________________________________*/
Signature Guaranteed:
________________________________________
______________________
*/ NOTE: 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 whatsoever.
<PAGE>
[EXHIBIT F]
[FORM OF B NOTES]
REGISTERED $______________*/
No. R-_________ CUSIP NO. _________
[UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE ISSUER OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY NOTE ISSUED IS
REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO
SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY
TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON
IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN.]
THE PRINCIPAL OF THIS NOTE IS PAYABLE IN INSTALLMENTS AS SET FORTH
HEREIN. ACCORDINGLY, THE OUTSTANDING PRINCIPAL AMOUNT OF THIS NOTE AT ANY
TIME MAY BE LESS THAN THE AMOUNT SHOWN ON THE FACE HEREOF.
CHASE MANHATTAN AUTO OWNER TRUST 199_-
_____% CLASS B ASSET BACKED NOTES
Chase Manhattan Auto Owner Trust 199_-, a trust organized and existing
under the laws of the State of Delaware (including any successor, the "Issuer"),
for value received, hereby promises to pay to [CEDE & CO.], or its registered
assigns, the principal sum of _________________________________________ DOLLARS
($_________________), partially 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 the
(ii) the aggregate amount, if any, payable from the Note Distribution Account
in respect of principal on the Class B Notes pursuant to Section 3.1 of the
Indenture; provided that the entire unpaid principal amount of this Note shall
be due and payable on the earlier of the ______________ Distribution Date and
the Redemption Date, if any, pursuant to Section 10.1 of the Indenture. No
payments of principal of the Class B Notes will be made until the principal of
the Class A-1 Notes, the Class A-3 Notes and Class A-4 Notes have been paid in
full. 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 Sections 2.7, 3.1 and 8.2 of the
______________
*/ Denominations of $1,000 and integral multiples of $1,000 in excess thereof.
<PAGE>
Indenture. Interest on this Note will accrue for each Distribution Date from the
most recent Distribution Date on which interest has been paid to but excluding
the then current Distribution Date or, if no interest has yet been paid, from
_____ __, 199_. 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 in the Indenture.
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 referred to on the
reverse hereof, 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.
Dated: ___________________ __, 199_
CHASE MANHATTAN AUTO OWNER TRUST
199_-
By: ____________________________,
not in its individual capacity but
solely as Owner Trustee under the
Trust Agreement
By: _________________________________
Name: ___________________________
Title: __________________________
<PAGE>
INDENTURE TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Notes designated above and referred to in the
within-mentioned Indenture.
Dated: _____________ __, 199_
_____________________ , ________
___________, not in its individual
capacity, but solely as Indenture
Trustee
By: _______________________________
Authorized Signatory
<PAGE>
[REVERSE OF NOTE]
This Note is one of a duly authorized issue of Notes of the Issuer,
designated as its _____% Class B Asset Backed Notes (herein called the "Class B
Notes" or the "Notes"), all issued under an Indenture dated as of ________ __,
199_ (such Indenture, as supplemented or amended, is herein called the
"Indenture"), between the Issuer and ______________________, ________
___________, not in its individual capacity but solely as trustee (the
"Indenture Trustee", which term includes any successor Indenture Trustee 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 the of the Issuer, the Indenture Trustee and the Holders
of the Notes. The Notes are subject to all terms of the Indenture. All terms
used in this Note that are not otherwise defined herein and that are defined in
the Indenture shall have the meanings assigned to them in or pursuant to the
Indenture.
The Notes are subordinated to the Class A Notes as provided in the
Indenture.
The Issuer shall pay interest on overdue installments of interest at
the Class B Interest Rate to the extent lawful.
Each Holder or Note Owner, by acceptance of a Note, or, in the case of
a Note Owner, a beneficial interest in the 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
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 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 Indenture Trustee or the
Owner 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.
It is the intent of the Seller, the Servicer, the Noteholders, the Note
Owners[,] [and] the Issuer[, the Certificateholders and the Certificate Owners]
that, the Notes will be classified as indebtedness of the Issuer for all United
States tax purposes. The Noteholders, by acceptance of a Note, agree to treat,
and to take no action inconsistent with the treatment of, the Notes as
<PAGE>
indebtedness of the Issuer for such tax purposes as indebtedness of the Issuer.
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 they
will not at any time institute against the Issuer, or join in any institution
against 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 other Basic Documents.
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.
Anything herein to the contrary notwithstanding, except as expressly
provided in the Basic Documents, neither Chase Manhattan Bank USA, National
Association, in its individual capacity, any owner of a beneficial interest in
the Issuer, nor any of their respective partners, beneficiaries, agents,
officers, directors, employees, 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, or performance of, or omission to perform, any of the covenants,
obligations or indemnifications contained in this Note or the Indenture, it
being expressly understood that said covenants, obligations and indemnifications
have been made by the Indenture Trustee for the sole purpose of binding the
interests of the Indenture Trustee in the assets of the Issuer. The Holder of
this Note by the 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 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.
<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, to transfer said Note on
the books kept for registration thereof, with full power of substitution in the
premises.
Dated: ____________________ _______________________________________*/
Signature Guaranteed:
_______________________________________
___________________
*/ NOTE: 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 whatsoever.
<PAGE>
EXHIBIT G
Note Depository Agreement
</TABLE>
<PAGE>
Exhibit 4.3(A)
Form of Certificate
of Trust
CERTIFICATE OF TRUST OF
Chase Manhattan Auto Owner Trust 199_-_
THIS Certificate of Trust of Chase Manhattan Auto Owner Trust 199_-_ (the
"Trust"), dated as of __________, 199_, is being duly executed and filed by
__________, a Delaware banking corporation, as trustee, to form a business trust
under the Delaware Business Trust Act (12 Del. C. Section 3801 et seq.).
1. Name. The name of the business trust formed hereby is Chase Manhattan
Auto Owner Trust 199_.
2. Delaware Trustee. The name and business address of the trustee of the
Trust in the State of Delaware is __________________________________.
3. This Certificate of Trust shall be effective on ____________, 199_.
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.
______________________, not in its
individual capacity but solely as
trustee of the Trust
By: ______________________________
Name:
Title:
<PAGE>
Exhibit 4.3(B)
--------------
Form of Organizational
Trust Agreement
TRUST AGREEMENT, dated as of ________ __, 199_, between Chase Manhattan
Bank USA, National Association, as Seller, and _______________ _______, a
Delaware banking corporation, not in its individual capacity but solely as Owner
Trustee (the "Owner Trustee"). The Seller and the Owner hereby agree as follows:
1. The trust created hereby shall be known as "Chase Manhattan Auto
Owner Trust 199_-_", in which name the Owner Trustee may engage in the
transactions contemplated hereby, make and execute contracts, and sue and be
sued.
2. The Seller hereby assigns, transfers, conveys and sets over to the
Owner Trustee the sum of $1. The Owner Trustee hereby acknowledges receipt of
such amount in trust from the Seller, which amount shall constitute the initial
trust estate. The Owner Trustee hereby declares that it will hold the trust
estate in trust for the Seller. It is the intention of the parties hereto that
the Trust created hereby constitute a business trust under Chapter 38 of Title
12 of the Delaware Code, 12 Del.C. section 3801 et seq. and that this document
constitute the governing instrument of the Trust. The Owner Trustee is hereby
authorized and directed to execute and file a certificate of trust with the
Delaware Secretary of State in the form attached hereto.
3. The Seller and the Owner Trustee will enter into an amended and
restated Trust Agreement, satisfactory to each such party, to provide for the
contemplated operation of the Trust created hereby. Prior to the execution and
delivery of such amended and restated Trust Agreement, the Owner Trustee shall
not have any duty or obligation hereunder or with respect to the trust estate,
except upon the written direction of the Seller to take such action as
determined by the Seller to be necessary to obtain prior to such execution and
delivery any licenses, consents or approvals required by applicable law or
otherwise.
4. This Trust Agreement may be executed in one or more counterparts.
5. The Owner Trustee may resign upon thirty days prior notice to the
Seller.
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Trust Agreement
to be duly executed by their respective officers hereunto duly authorized, as
of the day and year first above written.
CHASE MANHATTAN BANK USA, NATIONAL ASSOCIATION,
as Seller
By: ____________________________
Name:
Title:
____________________________, not in
its individual capactity but solely as
Owner Trustee
By: ______________________________
Name:
Title:
<PAGE>
FORM OF TRUST AGREEMENT (OWNER TRUST)
================================================================================
CHASE MANHATTAN AUTO OWNER TRUST 199 -_
TRUST AGREEMENT
between
CHASE MANHATTAN BANK USA, N.A.,
as Depositor
and
-----------------------,
as Owner Trustee
Dated as of __________ __, 199_
================================================================================
<PAGE>
TABLE OF CONTENTS
Page
----
ARTICLE I
DEFINITIONS
SECTION 1.1. Capitalized Terms............................................. 1
ARTICLE II
ORGANIZATION
SECTION 2.1 Name.......................................................... 2
SECTION 2.2 Office........................................................ 2
SECTION 2.3 Purposes and Powers........................................... 2
SECTION 2.4 Appointment of Owner Trustee.................................. 3
SECTION 2.5 Initial Capital Contribution of Trust Estate.................. 3
SECTION 2.6 Declaration of Trust.......................................... 3
SECTION 2.7 Title to Issuer Property...................................... 3
SECTION 2.8 Situs of Issuer............................................... 3
SECTION 2.9 Representations and Warranties of the Depositor............... 4
SECTION 2.10 Liability of Certificateholders............................... 4
SECTION 2.11 Guaranteed Payments/Gross Income Allocations.................. 4
SECTION 2.12 Deduction and Loss Allocations................................ 5
SECTION 2.13 Special Allocations........................................... 6
SECTION 2.14 Amended and Restated Trust Agreement.......................... 6
ARTICLE III
CERTIFICATES AND TRANSFER OF INTERESTS
SECTION 3.1 Initial Ownership............................................. 6
SECTION 3.2 The Certificates.............................................. 6
SECTION 3.3 Execution, Authentication and Delivery of Certificates........ 7
SECTION 3.4 Registration of Transfer and Exchange of Certificates......... 7
SECTION 3.5 Mutilated, Destroyed, Lost or Stolen Certificates............. 8
SECTION 3.6 Persons Deemed Certificateholders............................. 9
SECTION 3.7 Access to List of Certificateholders' Names and Addresses..... 9
SECTION 3.8 Maintenance of Office or Agency............................... 10
SECTION 3.9 Appointment of Paying Agent................................... 10
SECTION 3.10 Book-Entry Certificates....................................... 11
SECTION 3.11 Notices to Clearing Agency.................................... 12
SECTION 3.12 Definitive Certificates....................................... 12
SECTION 3.13 Authenticating Agent.......................................... 13
<PAGE>
SECTION 3.14 Actions of Certificateholders................................. 14
ARTICLE IV
ACTIONS BY OWNER TRUSTEE
SECTION 4.1 Prior Notice to Certificateholders with Respect to
Certain Matters............................................... 15
SECTION 4.2 Action by Certificateholders with Respect to
Certain Matters............................................... 16
SECTION 4.3 Action by Certificateholders with Respect to Bankruptcy....... 16
SECTION 4.4 Restrictions on Certificateholders' Power..................... 16
SECTION 4.5 Majority Control.............................................. 16
ARTICLE V
APPLICATION OF TRUST FUNDS; CERTAIN DUTIES
SECTION 5.1 Establishment of Certificate Distribution Account............. 16
SECTION 5.2 Application of Funds in Certificate Distribution Account...... 17
SECTION 5.3 Method of Payment............................................. 18
SECTION 5.4 No Segregation of Monies; No Interest......................... 18
SECTION 5.5 Accounting and Reports to the Noteholders,
Certificateholders, the Internal Revenue Service and Others... 18
SECTION 5.6 Signature on Returns; Tax Matters Partner..................... 19
SECTION 5.7 Capital Accounts.............................................. 19
ARTICLE VI
AUTHORITY AND DUTIES OF OWNER TRUSTEE
SECTION 6.1 General Authority............................................. 20
SECTION 6.2 General Duties................................................ 20
SECTION 6.3 Action upon Instruction....................................... 21
SECTION 6.4 No Duties Except as Specified in this Agreement or in
Instructions.................................................. 21
SECTION 6.5 No Action Except under Specified Documents or Instructions.... 22
SECTION 6.6 Restrictions.................................................. 22
SECTION 6.7 Doing Business in Other Jurisdictions......................... 22
ARTICLE VII
CONCERNING OWNER TRUSTEE
SECTION 7.1 Acceptance of Trusts and Duties............................... 23
SECTION 7.2 Furnishing of Documents....................................... 25
SECTION 7.3 Representations and Warranties................................ 25
ii
<PAGE>
SECTION 7.4 Reliance; Advice of Counsel................................... 26
SECTION 7.5 Not Acting in Individual Capacity............................. 27
SECTION 7.6 Owner Trustee May Own Certificates and Notes.................. 27
ARTICLE VIII
COMPENSATION OF OWNER TRUSTEE
SECTION 8.1 Owner Trustee's Fees and Expenses............................. 27
SECTION 8.2 Indemnification............................................... 27
SECTION 8.3 Payments to Owner Trustee..................................... 28
ARTICLE IX
TERMINATION OF TRUST AGREEMENT
SECTION 9.1 Termination of Trust Agreement................................ 28
ARTICLE X
SUCCESSOR OWNER TRUSTEES AND ADDITIONAL OWNER TRUSTEES
SECTION 10.1 Eligibility Requirements for Owner Trustee.................... 30
SECTION 10.2 Resignation or Removal of Owner Trustee....................... 30
SECTION 10.3 Successor Owner Trustee....................................... 31
SECTION 10.4 Merger or Consolidation of Owner Trustee...................... 31
SECTION 10.5 Appointment of Co-Trustee or Separate Trustee................. 32
ARTICLE XI
MISCELLANEOUS
SECTION 11.1 Supplements and Amendments.................................... 33
SECTION 11.2 No Legal Title to Owner Trust Estate in Certificateholders... 34
SECTION 11.3 Limitations on Rights of Others............................... 35
SECTION 11.4 Notices....................................................... 35
SECTION 11.5 Severability.................................................. 35
SECTION 11.6 Separate Counterparts......................................... 35
SECTION 11.7 Successors and Assigns........................................ 35
SECTION 11.8 No Recourse................................................... 36
SECTION 11.9 [Reserved].................................................... 36
SECTION 11.10 Headings...................................................... 36
SECTION 11.11 GOVERNING LAW................................................. 36
SECTION 11.12 Certificate Transfer Restrictions............................. 36
iii
<PAGE>
EXHIBITS
Exhibit A - Form of Certificate
Exhibit B - Form of Certificate of Trust
Exhibit C - Form of Certificate Depository Agreement
iv
<PAGE>
TRUST AGREEMENT dated as of __________ __, _____ between CHASE
MANHATTAN BANK USA, N.A. ("Chase USA"), a national banking association having
its principal executive offices located at 802 Delaware Avenue, Wilmington,
Delaware 19801, as the depositor (in its capacity as the depositor, the
"Depositor") and _________________________, a _____________ banking corporation,
as the owner trustee (the "Owner Trustee").
ARTICLE I
DEFINITIONS
SECTION 1.1. Capitalized Terms. Capitalized terms are used in this
Agreement as defined in Section 1.1 to the Sale and Servicing Agreement between
the trust established by this Agreement and Chase USA, as Seller and Servicer,
dated as of __________ __, ____, as the same may be amended and supplemented
from time to time (the "Sale and Servicing Agreement").
(a) 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.
(b) 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.
(c) 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."
(d) 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.
(e) All calculations of the amount of interest accrued on
the Certificates shall be made on the basis of a 360-day year consisting of
twelve 30-day months.
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ARTICLE II
ORGANIZATION
SECTION 2.1 Name. The trust created hereby shall be known as "Chase
Manhattan Auto Owner Trust 199_-_" (hereinafter, the "Issuer") in which name the
Owner Trustee may conduct the business of such trust, make and execute contracts
and other instruments on behalf of such trust and sue and be sued.
SECTION 2.2 Office. The office of the Issuer shall be in care of the
Owner Trustee at the Corporate Trust Office or at such other address as the
Owner Trustee may designate by written notice to the Certificateholders and the
Depositor.
SECTION 2.3 Purposes and Powers. The purpose of the Issuer is, and the
Issuer shall have the power and authority, to engage in the following
activities:
(a) to issue the Notes pursuant to the Indenture and
the Certificates pursuant to this Agreement, and to sell, transfer or
exchange the Notes and the Certificates;
(b) to acquire the property and assets set forth in the Sale
and Servicing Agreement from the Depositor pursuant to the terms
thereof, to make payments or distributions on the Notes and
Certificates, to make deposits to and withdrawals from the Reserve
Account and other accounts established under this Agreement and the
Sale and Servicing Agreement;
(c) to assign, grant, transfer, pledge, mortgage and convey
the Trust Estate pursuant to the Indenture and to hold, manage and
distribute to the Certificateholders 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 Issuer pursuant to, the Indenture;
(d) to enter into and perform its obligations under the
Basic Documents to which it is a party;
(e) to engage in those activities, including entering into
agreements, that are necessary, suitable or convenient to accomplish
the foregoing or are incidental thereto or connected therewith; and
(f) 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 Certificateholders and the Noteholders.
Issuer is hereby authorized to engage in the foregoing activities. Issuer shall
not engage in any activity other than in connection
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with the foregoing or other than as required or authorized by the terms of this
Agreement or the other Basic Documents.
SECTION 2.4 Appointment of Owner Trustee. The Depositor hereby appoints
the Owner Trustee as trustee of the Issuer effective as of the date hereof, to
have all the rights, powers and duties set forth herein.
SECTION 2.5 Initial Capital Contribution of Trust Estate. The Depositor
hereby sells, assigns, transfers, conveys and sets over to the Owner Trustee, as
of the date hereof, the Reserve Account Initial Deposit. 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 Reserve Account pursuant to Section 5.6(a)
of the Sale and Servicing Agreement. The Depositor shall pay the organizational
expenses of the Issuer 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 2.6 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 Certificateholders,
subject to the obligations of the Issuer under the Basic Documents. It is the
intention of the parties hereto that the Issuer 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 United States income and franchise tax purposes, the
Issuer shall be treated as a partnership. The parties agree that, unless
otherwise required by appropriate tax authorities, the Issuer will file or cause
to be filed annual or other necessary returns, reports and other forms
consistent with the characterization of the Issuer as a partnership for such tax
purposes. Effective as of the date hereof, the Owner Trustee shall have all
rights, powers and duties set forth herein and to the extent not inconsistent
herewith, in the Business Trust Statute with respect to accomplishing the
purposes of the Issuer. The Owner Trustee shall file the Certificate of Trust
with the Secretary of State of Delaware.
SECTION 2.7 Title to Issuer Property. Legal title to all the Owner
Trust Estate shall be vested at all times in the Issuer 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 the 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 2.8 Situs of Issuer. The Issuer will be located and
administered in the State of Delaware. All bank accounts maintained by the Owner
Trustee on behalf of the Issuer shall be located in the State of Delaware or the
State of New York.
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Payments will be received by the Issuer only in Delaware or New York, and
payments will be made by the Issuer only from Delaware or New York. The only
office of the Issuer will be at its office in Delaware.
SECTION 2.9 Representations and Warranties of the Depositor. The
Depositor hereby represents and warrants to the Owner Trustee that:
(i) The Depositor has been duly organized and is validly
existing as a national banking association in good standing under the
laws of the United States of America, with power and authority to own
its properties and to conduct its business as such properties are
currently owned and such business is presently conducted, and had at
all relevant times, and has, power, authority and legal right to
acquire and own the Receivables.
(ii) The Depositor has the corporate 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 Issuer, and the
Depositor has duly authorized such sale and assignment and deposit to
the Issuer by all necessary action; and the execution, delivery and
performance of this Agreement has been duly authorized by the Depositor
by all necessary action.
(iii) The consummation of the transactions contemplated by
this Agreement and the other Basic Documents 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 association or bylaws of the
Depositor, or conflict with or breach any of the material terms or
provisions of or constitute (with or without notice or lapse of time) a
default under any indenture, agreement or other instrument to which the
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; 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.
SECTION 2.10 Liability of Certificateholders. No Certificateholder
shall have any personal liability for any liability or obligation of the Issuer.
SECTION 2.11. Guaranteed Payments/Gross Income Allocations. (a)
Inasmuch as the Certificateholders' Interest Distributable Amount is determined
and paid hereunder without
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regard to the income of the Issuer, the Issuer shall treat payments of such
amounts as "guaranteed payments" within the meaning of Section 707(c) of the
Code. Consequently, Certificateholders will have ordinary income equal to their
allocable share of the Certificateholders' Interest Distributable Amount, the
Issuer will have an equivalent deduction for United States federal income tax
purposes and no amount of the gross income of the Issuer shall be allocable to
the Certificateholders (and there will be no corresponding increase in a
Certificateholders's Capital Account under Section 5.7). In the event that any
taxing authority does not respect such tax treatment, the gross income of the
Issuer for any calendar month as determined for United States federal income tax
purposes shall be allocated, after giving effect to special allocations set
forth in Section 2.12 of this Agreement and for purposes of maintaining Capital
Accounts under Section 5.7 of this Agreement as follows:
(1) first, among the Certificateholders as of the close of
the last day of such calendar month, in proportion to their ownership
of the principal amount of Certificates outstanding on such date, an
amount of gross income equal the amount of interest that accrues in
such calendar month on the Certificates in accordance with their terms,
including interest accruing thereon at the Certificate Rate monthly and
interest on amounts previously due under the Certificates and not yet
paid as provided therein; and
(2) the balance of gross income, if any, to the
Depositor.
If the gross income of the Issuer for any month is insufficient for the
allocations described in clause (1) above, subsequent items of gross income
shall first be allocated to make up such shortfall before being allocated as
provided in clause (2).
(b) In the event the initial issue price of the Certificates differs
from their initial principal amount, there shall be specially allocated to the
Certificateholders the portion, if any, of the offset for premium (in the case
the issue price of the Certificates exceeds their principal amount) or market
discount income (in the case the principal amount of the Certificates exceeds
their issue price) on the Receivables accruing for a calendar month that is
attributable to such difference.
SECTION 2.12. Deduction and Loss Allocations. (a) All items of
deduction and loss of the Issuer shall be allocated to the Depositor.
(b) To the extent that an allocation of the gross amount of deductions
and losses to the Depositor pursuant to Section 2.12(a) above would cause the
Capital Account of the Depositor to be reduced below zero, such excess
deductions and losses shall be allocated to the Certificateholders on a pro rata
basis until each of their Capital Accounts has been reduced to zero. If any
amount
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of gross deduction or loss has not been allocated pursuant to the preceding
sentence because all of the Certificateholders' Capital Accounts have been
reduced to zero, the amount of such remaining unallocated deductions or losses
shall be allocated to the Depositor.
(c) If any deductions or losses have been allocated to the
Certificateholders under Section 2.12(b) above, an amount of gross income shall
be allocated to such Certificateholders under this Section 2.12(c) in subsequent
taxable years sufficient to offset the amount of any deductions or losses
previously allocated to such Certificateholders under Section 2.12(b) above and,
thereafter, allocations of gross income and deductions shall be made in
accordance with Sections 2.11 and 2.12(a) of this Agreement.
SECTION 2.13. Special Allocations. In the event any Certificateholder
unexpectedly receives any adjustments, allocations or distributions described in
Treasury Regulation Section 1.704-1(b)(2)(ii)(d)(4), (5) or (6), items of Issuer
income and gain shall be specially allocated to such Certificateholder in an
amount and manner sufficient to eliminate, to the extent required by the
Treasury Regulations, the deficit, if any, in the balance of the Capital Account
of such Certificateholder as quickly as possible. This Section 2.13 is intended
to comply with the qualified income offset provision in Section 1.704-1(b)(2)
(ii)(d) of the Treasury Regulations.
SECTION 2.14. Amended and Restated Trust Agreement. This Agreement
amends and restates in its entirety the Trust Agreement dated as of __________
__, _____ between the Depositor and Owner Trustee.
ARTICLE III
CERTIFICATES AND TRANSFER OF INTERESTS
SECTION 3.1 Initial Ownership. Upon the formation of the Issuer by the
contribution by the Depositor pursuant to Section 2.5 and until the issuance of
the Certificates, the Depositor shall be the sole beneficiary of the Trust.
SECTION 3.2 The Certificates. The Certificates shall be issued in
denominations of $1,000 and integral multiples thereof; provided that one
Certificate that constitutes the residual portion of the initial Certificate
Balance may be issued in the form of a Definitive Certificate in a denomination
less than an integral multiple of $1,000. Upon initial issuance, the
Certificates shall each be in the form of Exhibit A, which is incorporated by
reference, and shall be issued as provided in Section 3.10 in an aggregate
principal amount equal to the Certificate Balance. The Certificates shall be
executed on behalf of the Issuer by manual or facsimile signature of an
Authorized Officer or other authorized signatory of the Owner Trustee.
Certificates bearing the manual or facsimile signatures of individuals who were,
at the time when such
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signatures shall have been affixed, authorized to sign on behalf of the Issuer,
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. No Certificate shall entitle the Holder to any benefit under this
Agreement, or shall be valid for any purpose, unless there shall appear on such
Certificate a certificate of authentication substantially in the form set forth
in Exhibit A, executed by the Owner Trustee or Chase, as the Owner Trustee's
authentication agent, by manual or facsimile signature; such authentication
shall constitute conclusive evidence that such Certificate shall have been duly
authenticated and delivered hereunder. All Certificates shall be dated the date
of their authentication. A transferee of a Certificate shall become a
Certificateholder, and shall be entitled to the rights and subject to the
obligations of a Certificateholder hereunder, upon due registration of such
Certificate in such transferee's name pursuant to Section 3.4.
SECTION 3.3 Execution, Authentication and Delivery of Certificates.
Concurrently with the transfer of the Receivables to the Issuer pursuant to the
Sale and Servicing Agreement, the Owner Trustee shall cause the Certificates in
an aggregate principal amount equal to the initial Certificate Balance to be
executed on behalf of the Issuer, authenticated and delivered to or upon the
written order of the Depositor, signed by its chairman of the board, its
president or any vice president, without further action by the Depositor, in
authorized denominations.
SECTION 3.4 Registration of Transfer and Exchange of Certificates. The
Owner Trustee shall cause to be kept at the office or agency to be maintained
pursuant to Section 3.8 by a certificate registrar (the "Certificate
Registrar"), a register (the "Certificate Register") in which, subject to such
reasonable regulations as it may prescribe, the Certificate Registrar shall
provide for the registration of Certificates and of transfers and exchanges of
Certificates as herein provided. Chase shall be the initial Certificate
Registrar. In the event that, subsequent to the date of issuance of the
Certificates, Chase notifies the Owner Trustee that it is unable to act as the
Certificate Registrar, the Owner Trustee shall act, or the Owner Trustee shall,
with the consent of the Depositor, appoint another bank or trust company, having
an office or agency located in The City of New York and which agrees to act in
accordance with the provisions of this Agreement applicable to it, to act, as
successor Certificate Registrar under this Agreement.
The Owner Trustee may revoke such appointment and remove Chase as the
Certificate Registrar if the Owner Trustee determines in its sole discretion
that Chase failed to perform its obligations under this Agreement in any
material respect. Chase shall be permitted to resign as the Certificate
Registrar upon 30 days' written notice
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to the Owner Trustee, the Depositor and the Issuer; provided, however, that such
resignation shall not be effective and Chase shall continue to perform its
duties as the Certificate Registrar until the Owner Trustee has appointed a
successor Certificate Registrar with the consent of the Depositor.
An institution succeeding to the corporate agency business of the
Certificate Registrar shall continue to be the Certificate Registrar without the
execution or filing of any paper or any further act on the part of the Owner
Trustee or such Certificate Registrar.
Upon surrender for registration of transfer of any Certificate at the
office or agency maintained pursuant to Section 3.8, the Owner Trustee shall
execute, authenticate and (if the Certificate Registrar is different than the
Owner Trustee, then the Certificate Registrar shall) deliver (or shall cause
Chase as its authenticating agent to authenticate and deliver), in the name of
the designated transferee or transferees, one or more new Certificates in
authorized denominations of a like class and aggregate face amount dated the
date of authentication by the Owner Trustee or any authenticating agent. At the
option of a Holder, Certificates may be exchanged for other Certificates of the
same class in authorized denominations of a like aggregate amount upon surrender
of the Certificates to be exchanged at the office or agency maintained pursuant
to Section 3.8.
Whenever any Certificate is surrendered for exchange, the Owner Trustee
shall execute, authenticate and (if the Certificate Registrar is different than
the Owner Trustee, then the Certificate Registrar shall) deliver the
Certificates which the Certificateholder making the exchange is entitled to
receive. Every Certificate presented or surrendered for registration of transfer
or exchange shall be accompanied by a written instrument of transfer in form
satisfactory to the Owner Trustee and the Certificate Registrar duly executed by
the Holder, which signature on such assignment must be guaranteed by a member of
the New York Stock Exchange or a commercial bank or trust company.
Each Certificate surrendered for registration of transfer or exchange
shall be canceled and subsequently disposed of by the Owner Trustee or
Certificate Registrar in accordance with its customary practice.
No service charge shall be made for any registration of transfer or
exchange of Certificates, but the 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.
SECTION 3.5 Mutilated, Destroyed, Lost or Stolen Certificates.
If (a) any mutilated Certificate shall be surrendered to the Certificate
Registrar, of if the Certificate Registrar shall receive evidence to its
satisfaction of the
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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 shall have been acquired by a bona fide purchaser,
the Owner Trustee on behalf of Issuer shall execute and the Owner Trustee, or
Chase, as the Owner Trustee's authenticating agent, shall authenticate and (if
the Certificate Registrar is different from the Owner Trustee, then the
Certificate Registrar shall) deliver, in exchange for or in lieu of any such
mutilated, destroyed, lost or stolen Certificate, a new Certificate of like
class, tenor and denomination. If, after delivery of such replacement
Certificate, a bona fide purchaser of the original Certificate in lieu of which
such replacement Certificate was issued presents for payment such original
Certificate, the Owner Trustee or the Certificate Registrar shall be entitled to
recover such replacement Certificate from such Person to whom such replacement
Certificate 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 Owner Trustee or the Certificate Registrar in connection therewith. In
connection with the issuance of any new Certificate under this Section 3.5, 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 an ownership interest in Issuer, as if
originally issued, whether or not the lost, stolen or destroyed Certificate
shall be found at any time. The provisions of this Section 3.5 are exclusive and
shall preclude (to the extent lawful) all other rights and remedies with respect
to the replacement of mutilated, destroyed, lost or stolen Certificates.
SECTION 3.6 Persons Deemed Certificateholders. Prior to due
presentation of a Certificate for registration of transfer, the Owner Trustee
or the Certificate Registrar may treat the Person in whose name any Certificate
shall be registered in the Certificate Register as the owner of such
Certificate for the purpose of receiving distributions pursuant to Section 5.2
and for all other purposes whatsoever, and neither the Owner Trustee nor the
Certificate Registrar shall be bound by any notice to the contrary.
SECTION 3.7 Access to List of Certificateholders' Names and Addresses.
The Certificate Registrar shall furnish or cause to be furnished to the Servicer
and the Depositor (and to the Owner Trustee, if the Owner Trustee is not the
Certificate Registrar) within 15 days after receipt by the Certificate Registrar
of a request therefor from the Servicer or the Depositor (or the Owner Trustee)
in writing, a list, in such form as the Servicer or the Depositor (or the Owner
Trustee) may reasonably require, of the names and addresses of the
Certificateholders as of the most recent Record Date. If, at such time, if any,
as Definitive Certificates have been issued, if three or more Holders of
Certificates or one
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or more Holders of Certificates evidencing not less than 25% of the Certificate
Balance apply in writing to the Certificate Registrar, and such application
states that the applicants desire to communicate with other Certificateholders
with respect to their rights under this Agreement or under the Certificates and
such application is accompanied by a copy of the communication that such
applicants propose to transmit, then the Certificate Registrar shall, within
five Business Days after the receipt of such application, afford such applicants
access during normal business hours to the current list of Certificateholders.
Each Holder, by receiving and holding a Certificate, shall be deemed to have
agreed to hold none of the Depositor, the Certificate Registrar, the Servicer 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 3.8 Maintenance of Office or Agency. The Owner Trustee
shall maintain in the City of New York, an office or offices or agency or
agencies where Certificates may be surrendered for registration of transfer or
exchange. The Owner Trustee initially designates the offices of The Chase
Manhattan Bank located at 450 West 33rd Street, New York, New York 10001-2697
as its office for such purposes. The Owner Trustee shall give prompt written
notice to the Depositor, the Servicer and to the Certificateholders of any
change in the location of the Certificate Register or any such office or agency.
SECTION 3.9 Appointment of Paying Agent. The Owner Trustee may appoint
a Paying Agent with respect to the Certificates. The Owner Trustee hereby
appoints Chase as the initial Paying Agent. The Paying Agent shall have the
revocable power to withdraw funds from the Certificate Distribution Account,
make distributions to Certificateholders from the Certificate Distribution
Account pursuant to Section 5.2 and shall report the amounts of such
distributions to the Owner Trustee. 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 for other good cause. The Paying Agent
shall be permitted to resign upon 30 days' written notice to the Owner Trustee
and the Servicer. In the event that Chase shall no longer be the Paying Agent,
the Owner Trustee shall appoint a successor to act as Paying Agent (which shall
be a bank or trust company and may be the Owner Trustee), with the consent of
the Depositor (which consent shall not be unreasonably withheld). The Owner
Trustee shall cause such successor Paying Agent or any additional Paying Agent
appointed by the Owner Trustee (unless it is 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
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Paying Agent shall return all unclaimed funds to the Owner Trustee and upon the
removal of a Paying Agent, such Paying Agent shall also return all funds in its
possession to the Owner Trustee. The provisions of Sections 7.1, 7.3, 7.4, 7.6,
8.1 and 8.2 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 Book-Entry Certificates. The Certificates, upon original
issuance, will be issued in the form of a typewritten Certificate or
Certificates representing Book-Entry Certificates, to be delivered to The
Depository Trust Company, the initial Clearing Agency, by or on behalf of the
Issuer; provided that one Certificate that constitutes the residual portion of
the Certificate Balance may be issued in the form of a Definitive Certificate in
a denomination less than an integral multiple of $1,000. Such Book-Entry
Certificate or Certificates shall initially be registered on the Certificate
Register in the name of Cede & Co., the nominee of the initial Clearing Agency,
and no beneficial owner (other than Chase Securities Inc.) will receive a
definitive Certificate representing such beneficial owner's interest in such
Certificate, except as provided in Section 3.12. Unless and until Definitive
Certificates have been issued to beneficial owners pursuant to Section 3.12:
(a) the provisions of this Section 3.10 shall be in
full force and effect;
(b) the Certificate Registrar, the Paying Agent and the
Owner Trustee shall be entitled to deal with the Clearing Agency and
the Clearing Agency Participants for all purposes of this Agreement
relating to the Book-Entry Certificates (including the payment of
principal of and interest on the Book-Entry Certificates and the
giving of instructions or directions to Certificate Owners of
Book-Entry Certificates) as the sole Holder of Book-Entry
Certificates and shall have no obligations to Certificate Owners
thereof;
(c) to the extent that the provisions of this Section
conflict with any other provisions of this Agreement, the provisions of
this Section shall control;
(d) the rights of Certificate Owners of the Book-Entry
Certificates shall be exercised only through the Clearing Agency (or to
the extent Certificateholders are not Clearing Agency Participants,
through the Clearing Agency Participants through which such
Certificateholders own Book-Entry Certificates), and shall be limited
to those established by law and agreements between such Certificate
Owners and the Clearing Agency and/or Clearing Agency Participants, and
all references in this Agreement to actions by Certificateholders shall
refer to actions taken by the Clearing Agency upon in-
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structions from the Clearing Agency Participants, and all references in
this Agreement to distributions, notices, reports and statements to
Certificateholders shall refer to distributions, notices, reports and
statements to the Clearing Agency, as registered holder of the
Certificates, as the case may be, for distribution to
Certificateholders in accordance with the procedures of the Clearing
Agency. Pursuant to the Certificate Depository Agreement, unless and
until Definitive Certificates are issued pursuant to Section 3.12, the
initial Clearing Agency will make book-entry transfers among Clearing
Agency Participants and receive and transmit payments of principal of
and interest on the Book-Entry Certificates to such Clearing Agency
Participants; and
(e) whenever this Agreement requires or permits actions to
be taken based upon instructions or directions of the Holders of
Certificates evidencing a specified percentage of the Certificate
Balance, the Clearing Agency shall be deemed to represent such
percentage only to the extent that it has received instructions to such
effect from Certificate Owners and/or Clearing Agency Participants
owning or representing, respectively, such required percentage of the
beneficial interest in the Book-Entry Certificates and has delivered
such instructions to the Owner Trustee.]
[SECTION 3.11 Notices to Clearing Agency. Whenever a notice or other
communication to Certificateholders is required under this Agreement, unless and
until Definitive Certificates shall have been issued to Certificate Owners
pursuant to Section 3.12, the Owner Trustee and the Paying Agent shall give all
such notices and communications specified herein to be given to
Certificateholders to the Clearing Agency, and shall have no obligations to
Certificate Owners.]
[SECTION 3.12 Definitive Certificates. If (a) the Servicer advises the
Owner Trustee in writing that the Clearing Agency is no longer willing or able
to properly discharge its responsibilities with respect to the Certificates, and
the Servicer is unable to locate a qualified successor, (b) the Servicer at its
option elects to terminate the book-entry system through the Clearing Agency, or
(c) after the occurrence of an Event of Servicing Termination or Event of
Default, Certificate Owners of the Certificates representing beneficial
interests aggregating not less than a majority of the Certificate Balance advise
the Clearing Agency through the Clearing Agency Participants, and the Owner
Trustee, in writing, and if the Clearing Agency shall so notify the Owner
Trustee, that the continuation of a book-entry system through the Clearing
Agency is no longer in the best interests of Certificate Owners, then the Owner
Trustee shall notify the Clearing Agency of the occurrence of any such event,
which shall be responsible to notify the Certificate Owners of the occurrence of
such event and of the availability of the Definitive Certificates to Certificate
Owners requesting the same. Upon surrender to the Certificate Registrar of the
typewritten Certificate or Certificates
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representing the Book-Entry Certificates by the Clearing Agency, accompanied by
re-registration instructions, the Owner Trustee shall execute, authenticate, or
cause to be authenticated, and (if the Certificate Registrar is different than
the Owner Trustee, then the Certificate Registrar shall) deliver the Definitive
Certificates in accordance with the instructions of the Clearing Agency. Neither
the Certificate Registrar nor the Owner 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
Certificates, all references herein to obligations imposed upon or to be
performed by the Clearing Agency shall be deemed to be imposed upon and
performed by the Certificate Registrar, to the extent applicable with respect to
such Definitive Certificates, and the Owner Trustee and the Paying Agent shall
recognize the Holders of the Definitive Certificates as Certificateholders. The
Definitive Certificates shall be printed, lithographed or engraved or may be
produced in any other matter as is reasonably acceptable to the Owner Trustee,
as evidenced by its execution thereof.]
SECTION 3.13 Authenticating Agent.
(a) The Owner Trustee may appoint one or more authenticating agents
with respect to the Certificates which shall be authorized to act on behalf of
the Owner Trustee in authenticating the Certificates in connection with the
issuance, delivery, registration of transfer, exchange or repayment of the
Certificates. The Owner Trustee hereby appoints Chase as Authenticating Agent
for the authentication of Certificates upon any registration of transfer or
exchange of such Certificates. Whenever reference is made in this Agreement to
the authentication of Certificates by the Owner Trustee or the Owner Trustee's
certificate of authentication, such reference shall be deemed to include
authentication on behalf of the Owner Trustee by an authenticating agent and a
certificate of authentication executed on behalf of the Owner Trustee by an
authenticating agent. Each authenticating agent (other than Chase) shall be
subject to acceptance by the Depositor.
(b) Any institution succeeding to the corporate agency business of an
authenticating agent shall continue to be an authenticating agent without the
execution or filing of any paper or any further act on the part of the Owner
Trustee or such authenticating agent.
(c) An authenticating agent may at any time resign by giving written
notice of resignation to the Owner Trustee and the Depositor. The Owner Trustee
may at any time terminate the agency of an authenticating agent by giving notice
of termination to such authenticating agent and to the Depositor. Upon receiving
such a notice of resignation or upon such a termination, or in case at any time
an authenticating agent shall cease to be acceptable to the Owner Trustee or the
Depositor, the Owner Trustee promptly may appoint a successor authenticating
agent with the consent of the
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Depositor. Any successor authenticating agent upon acceptance of its appointment
hereunder shall become vested with all the rights, powers and duties of its
predecessor hereunder, with like effect as if originally named as an
authenticating agent.
(d) The Depositor shall pay the authenticating agent from time to time
reasonable compensation for its services under this Section 3.13.
(e) The provisions of Sections 7.1, 7.3, 7.4, 7.6, 8.1 and 8.2 shall be
applicable to any authenticating agent.
(f) Pursuant to an appointment made under this Section 3.13, the
Certificates may have endorsed thereon, in lieu of the Owner Trustee's
certificate of authentication, an alternate certificate of authentication in
substantially the following form:
This is one of the Certificates referred to in the within mentioned
Agreement.
-------------------------------,
as Owner Trustee
By:
-------------------------------
Authorized Officer
or
-------------------------------
as Authenticating Agent
for the Owner Trustee,
-------------------------------
Authorized Officer
SECTION 3.14 Actions of Certificateholders.
(a) Any request, demand, authorization, direction, notice, consent,
waiver or other action provided by this Agreement to be given or taken by the
Certificateholders may be embodied in and evidenced by one or more instruments
of substantially similar tenor signed by such Certificateholders in person or by
agent duly appointed in writing; and except as herein otherwise expressly
provided, such action shall become effective when such instrument or instruments
are delivered to the Owner Trustee and, when required, to the Depositor or the
Servicer. Proof of execution of any such instrument or of a writing appointing
any such agent shall be sufficient for any purpose of this Agreement and
conclusive in favor of the Owner Trustee, the Depositor and the Servicer, if
made in the manner provided in this Section 3.14.
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(b) The fact and date of the execution by any Certificateholder of
any such instrument or writing may be proved in any reasonable manner which the
Owner Trustee deems sufficient.
(c) Any request, demand, authorization, direction, notice, consent,
waiver or other act by a Certificateholder shall bind every Holder of every
Certificate issued upon the registration of transfer thereof or in exchange
therefor or in lieu thereof, in respect of anything done, or omitted to be done,
by the Owner Trustee, the Depositor or the Servicer in reliance thereon,
regardless of whether notation of such action is made upon such Certificate.
(d) The Owner Trustee may require such additional proof of any matter
referred to in this Section 3.14 as it shall deem necessary.
ARTICLE IV
ACTIONS BY OWNER TRUSTEE
SECTION 4.1 Prior Notice to Certificateholders 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 Certificateholders shall not have notified the Owner Trustee in
writing prior to the 30th day after such notice is given that such
Certificateholders have withheld consent or provided alternative direction:
(a) the initiation of any material claim or lawsuit by the
Issuer (except claims or lawsuits brought in connection with the
collection of the Receivables) and the compromise of any material
action, claim or lawsuit brought by or against the Issuer (except with
respect to the aforementioned claims or lawsuits for collection of the
Receivables);
(b) the election by the Issuer 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 interest of the
Certificateholders;
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(e) the amendment, change or modification of the Sale and
Servicing Agreement, except to any amendment where the consent of any
Certificateholder is not required under the terms of the Sale and
Servicing Agreement; or
(f) the appointment pursuant to the Indenture of a successor
Indenture Trustee or the consent to the assignment by the Note
Registrar, the Paying Agent, the Trustee or the Certificate Registrar
of its obligations under the Indenture or this Agreement, as
applicable.
The Owner Trustee shall notify the Certificateholders in writing of any
appointment of a successor Paying Agent, Authenticating Agent or Certificate
Registrar within five Business Days thereof.
SECTION 4.2 Action by Certificateholders with Respect to Certain
Matters. The Owner Trustee shall not have the power, except upon the direction
of the Certificateholders, to (a) remove the Servicer under the Sale and
Servicing Agreement pursuant to Article VIII thereof, (b) remove the
Administrator under the Administration Agreement pursuant to Section 8 thereof
or (c) except as expressly provided in the Basic Documents, sell the Receivables
or any interest therein after the termination of the Indenture. The Owner
Trustee shall take the actions referred to in the preceding sentence only upon
written instructions signed by the Certificateholders.
SECTION 4.3 Action by Certificateholders with Respect to Bankruptcy.
The Owner Trustee shall not have the power to commence a voluntary proceeding in
bankruptcy relating to the Issuer without the unanimous prior approval of all
Certificateholders unless the Owner Trustee reasonably believes that the Issuer
is insolvent.
SECTION 4.4 Restrictions on Certificateholders' Power. The
Certificateholders shall not direct the Owner Trustee to take or refrain from
taking any action if such action or inaction would be contrary to any obligation
of the Issuer or the Owner Trustee under this Agreement or any of the other
Basic Documents or would be contrary to Section 2.3 nor shall the Owner Trustee
be obligated to follow any such direction, if given.
SECTION 4.5 Majority Control. Except as expressly provided herein, any
action that may be taken by the Certificateholders under this Agreement may be
taken by the Holders of Certificates evidencing not less than a majority of the
Certificate Balance. Except as expressly provided herein, any written notice of
the Certificateholders delivered pursuant to this Agreement shall be effective
if signed by the Holders of Certificates evidencing not less than a majority of
the Certificate Balance at the time of the delivery of such notice.
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ARTICLE V
APPLICATION OF TRUST FUNDS; CERTAIN DUTIES
SECTION 5.1 Establishment of Certificate Distribution Account. The
Owner Trustee, for the benefit of Certificateholders, shall establish and
maintain in the name of the Issuer an Eligible Deposit Account (the "Certificate
Distribution Account"), bearing a designation clearly indicating that the funds
deposited therein are held for the benefit of the Certificateholders. Except as
otherwise provided herein, the Certificate Distribution Account shall be under
the sole dominion and control of the Owner Trustee for the benefit of the
Certificateholders.
The Owner Trustee shall possess all right, title and interest in all
funds on deposit from time to time in the Certificate Distribution Account and
in all proceeds thereof. If, at any time, the Certificate Distribution Account
ceases to be an Eligible Deposit Account, the Servicer shall establish a new
Certificate Distribution Account as an Eligible Deposit Account in accordance
with Section 5.1(b) of the Sale and Servicing Agreement, and the Owner Trustee
shall transfer any cash and/or any investments to such new Certificate
Distribution Account and shall assist the Servicer in establishing such account
as necessary.
Amounts on deposit in the Certificate Distribution Account shall not be
invested.
SECTION 5.2 Application of Funds in Certificate Distribution Account.
(a) Not later than 12:00 noon, New York City time, on each Distribution Date,
the Owner Trustee or the Paying Agent on behalf of the Owner Trustee will, based
on the information contained in the Servicer's Certificate delivered on the
related Determination Date pursuant to Section 4.8 of the Sale and Servicing
Agreement, distribute to Certificateholders, to the extent of the funds
available, amounts deposited in the Certificate Distribution Account pursuant to
Section 5.5 of the Sale and Servicing Agreement on such Distribution Date in the
following order of priority:
(i) first, to the Certificateholders, on a pro rata
basis, an amount equal to the Certificateholders' Interest
Distributable Amount; and
(ii) second, to the Certificateholders, on a pro rata basis,
an amount equal to the Certificateholders' Principal Distributable
Amount.
(b) On each Distribution Date, the Owner Trustee shall send, or cause
to be sent, to each Certificateholder the statement provided to the Owner
Trustee by the Servicer pursuant to Section 5.8 of the Sale and Servicing
Agreement on such Distribution Date.
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(c) In the event that any withholding tax is imposed on the Issuer's
payment (or allocations of income) to a Certificateholder, such tax shall reduce
the amount otherwise distributable to the Certificateholder in accordance with
this Section. Each of the Owner Trustee and the Paying Agent is hereby
authorized and directed to retain from amounts otherwise distributable to the
Certificateholders sufficient funds for the payment of any tax that is legally
owed by the Issuer (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 a Certificateholder shall
be treated as cash distributed to such Certificateholder at the time it is
withheld by the Issuer and remitted to the appropriate taxing authority. The
Owner Trustee or the Paying Agent, on its behalf, intends to withhold United
States withholding taxes from any amounts allocable or distributed to non-United
States Certificateholders at a rate of 35% for non-United States
Certificateholders that are classified as corporations for United States federal
income tax purposes and at a rate of 39.6% for all other non-United States
Certificateholders. In the event that a Certificateholder wishes to apply for a
refund of any such withholding tax, the Owner Trustee and the Paying Agent shall
reasonably cooperate with such Certificateholder in making such claim so long as
such Certificateholder agrees to reimburse the Owner Trustee and the Paying
Agent for any out-of-pocket expenses incurred.
SECTION 5.3 Method of Payment. Subject to Section 9.1(c), distributions
required to be made to Certificateholders on any Distribution Date shall be made
to each Certificateholder of record on the preceding Record Date either (a) 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
and such Holder's Certificates in the aggregate evidence a denomination of not
less than $1,000,000 or (b) by check mailed to such Certificateholder at the
address of such Holder appearing in the Certificate Register; provided that,
unless Definitive Certificates have been issued pursuant to Section 3.12, with
respect to Certificates registered on the Record Date in the name of the nominee
of the Clearing Agency (initially, such nominee to be Cede & Co.), distributions
will be made by wire transfer in immediately available funds to the account
designated by such nominee.
SECTION 5.4 No Segregation of Monies; No Interest. Subject to Sections
5.1 and 5.2, monies received by the Owner Trustee or any Paying Agent hereunder
need not be segregated in any manner except to the extent required by law and
may be deposited under such general conditions as may be prescribed by law, and
neither the Owner Trustee nor any Paying Agent shall be liable for any interest
thereon.
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SECTION 5.5 Accounting and Reports to the Noteholders,
Certificateholders, the Internal Revenue Service and Others. The Owner Trustee
shall (a) maintain (or cause to be maintained) the books of the Issuer on a
calendar year basis on the accrual method of accounting, (b) deliver (or cause
to be delivered) to each Certificateholder, as may be required by the Code and
applicable Treasury Regulations, such information as may be required (including
Schedule K-1) to enable each Certificateholder to prepare its Federal and state
income tax returns, (c) prepare or cause to be prepared and file such tax
returns relating to the Issuer (including a partnership information return, Form
1065), and make such elections as may from time to time be required or
appropriate under any applicable state or Federal statute or rule or regulation
thereunder so as to maintain the Trust's characterization as a partnership for
Federal income tax purposes and (d) collect or cause to be collected any
withholding tax as described in and in accordance with Section 5.2(c) with
respect to income or distributions to Certificateholders. The Depositor shall
sign all tax information returns filed pursuant to this Section 5.5 and any
other returns as may be required by law. The Owner Trustee shall elect under
Section 1278 of the Code to include in income currently any market discount that
accrues with respect to the Receivables. The Owner Trustee shall not make the
election provided under Section 754 of the Code.
SECTION 5.6 Signature on Returns; Tax Matters Partner. Notwithstanding
the provisions of Section 5.5, the Depositor shall sign on behalf of the Issuer
the tax returns of the Issuer, unless applicable law requires the Owner Trustee
to sign such documents, in which case such documents shall be signed by the
Owner Trustee at the written direction of the Depositor.
The Depositor shall be the "tax matters partner" of the Issuer pursuant
to the Code.
SECTION 5.7 Capital Accounts. The Issuer shall maintain accounts
("Capital Accounts") with respect to each Certificateholder and the Depositor
(each an "Owner"). For this purpose, Capital Accounts shall be maintained in
accordance with the following provisions:
(a) Each Owner's Capital Account shall be increased by the
Capital Contributions (as defined below) of such Owner, such Owner's
distributive share of gross income (if any) and any items in the nature
of income or gain that are allocated to such Owner pursuant to Section
2.11, 2.12(c) or 2.13.
(b) Each Owner's Capital Account shall be reduced by any
amount distributed to such Owner (including, in the case of the
Depositor, any amount released or otherwise distributed to the
Depositor from the Reserve Account under Section 5.6 of the Sale and
Servicing Agreement) and any items in the nature of deductions or
losses that are allocated to such Owner pursuant to Section 2.12 or
2.13.
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(c) In the event all or a portion of a Certificate is
transferred in accordance with the terms of this Agreement, the
transferee shall succeed to the Capital Account of the transferor to
the extent it related to such Certificate or a portion thereof.
"Capital Contribution" means the amount of any cash contributed to the
Issuer by an Owner (including any amounts deemed to be contributed in connection
with the original issuance of the Certificates), including, in the case of the
Depositor, the amount of any Receivables deemed to have been contributed by the
Depositor (with such amount for Receivables intended to reflect the amount of
the Receivables and monies due thereon or with respect thereto, including
accrued but unpaid interest and finance charges, conveyed to the Issuer by the
Depositor on the Closing Date under Article II of the Sale and Servicing
Agreement). The foregoing provisions and the other provisions of this Agreement
relating to the maintenance of Capital Accounts are intended to comply with
Section 1.704-l(b) of the Treasury Regulations and shall be interpreted in a
manner consistent therewith.
ARTICLE VI
AUTHORITY AND DUTIES OF OWNER TRUSTEE
SECTION 6.1 General Authority. The Owner Trustee is authorized and
directed to execute and deliver the Basic Documents to which the Issuer is named
as a party and each certificate or other document attached as an exhibit to or
contemplated by the Basic Documents to which the Issuer is named as a party and
any amendment thereto, in each case, in such form as the Depositor shall approve
as evidenced conclusively by the Owner Trustee's execution thereof, and, on
behalf of the Issuer at the written direction of the Depositor, to direct the
Indenture Trustee to authenticate and deliver Class A-1 Notes in the aggregate
principal amount of $_____________, Class A-2 Notes in the aggregate principal
amount of $______________, Class A-3 Notes in the aggregate principal amount of
$______________, Class A-4 Notes in the aggregate principal amount of
$______________ and Class [A-5][B] Notes in the aggregate principal amount of
$_____________. In addition to the foregoing, the Owner Trustee is authorized,
but shall not be obligated, to take all actions required of the Issuer pursuant
to the Basic Documents. The Owner Trustee is further authorized from time to
time to take such action as the Administrator recommends or directs in writing
with respect to the Basic Documents.
SECTION 6.2 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 other Basic Documents and to administer the
Issuer in the interest of Certificateholders, subject to the Basic Documents and
in accordance with the provisions of this Agreement. Notwithstanding
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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 or the Issuer hereunder or under any
other Basic Document, and the Owner Trustee shall not be liable for the default
or failure of the Administrator to carry out its obligations under the
Administration Agreement.
SECTION 6.3 Action upon Instruction. (a) Subject to Article IV, the
Certificateholders may, by written instruction, direct the Owner Trustee in the
management of the Issuer. Such direction may be exercised at any time by written
instruction of the Certificateholders pursuant to Section 4.5.
(b) Notwithstanding the foregoing, the Owner Trustee shall not be
required to take any action hereunder or under any other Basic Document if the
Owner Trustee shall reasonably determine, or shall have been advised by counsel
in writing, that such action is likely to result in personal liability to the
Owner Trustee (in such capacity or individually), is contrary to the terms of
this Agreement or any other Basic Document or is 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 any
other Basic Document or is unsure as to the application of any provision of this
Agreement or any Basic Document, or if 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 Certificateholders 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 Certificateholders received,
the Owner Trustee shall not be liable on account of such action to any Person.
If the Owner Trustee shall not have received appropriate instruction within ten
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 other Basic Documents, as it shall deem
to be in the best interests of the Certificateholders, and shall have no
liability to any Person for such action or inaction.
SECTION 6.4 No Duties Except as Specified in this Agreement or in
Instructions. The Owner Trustee shall undertake to perform such duties and only
such duties as are specifically set forth in this Agreement and the other Basic
Documents, and no implied covenants or obligations shall be read into this
Agreement or the other Basic Documents. The Owner Trustee shall not have any
duty
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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 6.3; 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
Commission filing for the Issuer or to record this Agreement or any other 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, in its individual capacity, that are not related to
the ownership or the administration of the Owner Trust Estate.
SECTION 6.5 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 6.3.
SECTION 6.6 Restrictions. The Owner Trustee shall not (a) take any
action that is inconsistent with the purposes of the Issuer set forth in Section
2.3 or (b) take any action or amend this Agreement in any manner that, to the
best knowledge of the Owner Trustee, would result in the Issuer's becoming
taxable as a corporation for United States federal income tax purposes. The
Owner Trustee and Depositor agree that no election to treat the Issuer other
than as a partnership for United States federal income tax purposes or any
relevant state tax purposes shall be made by or on behalf of the Issuer. The
Certificateholders shall not direct the Owner Trustee to take action that would
violate the provisions of this Section.
SECTION 6.7 Doing Business in Other Jurisdictions. (a) Notwithstanding
anything contained herein to the contrary, the Owner Trustee shall not be
required to take any action in any jurisdiction other than in the State of
Delaware, other than as set forth in the last sentence of this Section 6.7, if
the taking of such action will (i) require the consent or approval or
authorization or order of or the giving of notice to, or the registration with
or the taking of any other action in respect of, any state or other governmental
authority or agency of any jurisdiction other than the State of Delaware; (ii)
result in any
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fee, tax or other governmental charge under the laws of any jurisdiction or any
political subdivisions thereof in existence on the date hereof other than the
State of Delaware becoming payable by the Owner Trustee; or (iii) subject the
Owner Trustee to personal jurisdiction in any jurisdiction other than the State
of Delaware for causes of action arising from acts unrelated to the consummation
of the transactions by the Owner Trustee, as the case may be, contemplated
hereby. The Owner Trustee shall be entitled to obtain advice of counsel (which
advice shall be an expense of the Depositor) to determine whether any action
required to be taken pursuant to this Agreement results in the consequences
described in clauses (i), (ii) and (iii) of the preceding sentence. In the event
that said counsel advises the Owner Trustee that such action will result in such
consequences, the Owner Trustee will appoint an additional trustee pursuant to
Section 10.5 to proceed with such action.
ARTICLE VII
CONCERNING OWNER TRUSTEE
SECTION 7.1 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 other 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, bad faith or gross
negligence or (ii) in the case of the breach of any representation or warranty
contained in Section 7.3 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 a Responsible Officer of the Owner
Trustee unless it is proved that the Owner Trustee was grossly
negligent in ascertaining the pertinent facts;
(b) The Owner Trustee shall not be liable with respect to any
action it takes or omits to take in good faith in accordance with the
instructions of the Certificateholders given pursuant to Section 6.3;
(c) No provision of this Agreement or any other Basic Document
shall require the Owner Trustee to expend or risk funds or otherwise
incur any financial liability in its own performance of any of its
rights or powers hereunder or under any other Basic Document if the
Owner Trustee shall have reasonable grounds for believing that
repayment of such funds
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or adequate indemnity against such risk or liability is not 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;
(e) The Owner Trustee shall not be responsible for and makes
no representation as to the validity or adequacy of this Agreement or
for the due execution hereof by the Depositor 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, shall not be accountable for the use or application
by the Depositor of the proceeds from the Certificates, and the Owner
Trustee shall in no event assume or incur any liability, duty or
obligation to any Noteholder or to any Certificateholder, other than as
expressly provided for herein and in the Basic 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 the ability of the Owner Trust
Estate to generate the payments to be distributed to Certificateholders
under this Agreement or the Noteholders under the Indenture, including:
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 Issuer or of
any intervening assignment; the completeness of any Receivable; the
performance or enforcement of any Receivable; the compliance by the
Depositor or the Servicer with any warranty or representation made
under any Basic Document or in any related document or the accuracy of
any such warranty or representation or any action of the Indenture
Trustee, the Administrator or the Servicer or any subservicer taken in
the name of the Owner Trustee;
(f) The Owner Trustee shall not be liable for the default or
misconduct of the Indenture Trustee, the Administrator 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
Issuer 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 under the
Sale and Servicing Agreement;
(g) The Owner Trustee shall be under no obligation to
exercise any of the rights or powers vested in it by this
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Agreement, or to institute, conduct or defend any litigation under this
Agreement or otherwise or in relation to this Agreement or any other
Basic Document, at the request, order or direction of any of the
Certificateholders, unless such Certificateholders 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 other
Basic Document shall not be construed as a duty, and the Owner Trustee
shall not be answerable for other than its negligence, bad faith or
willful misconduct in the performance of any such act; and
(h) The Owner Trustee, upon receipt of any resolutions,
certificates, statements, opinions, reports, documents, orders or other
instruments furnished to the Owner Trustee that shall be specifically
required to be furnished pursuant to any provision of this Agreement or
the other Basic Documents, shall examine them to determine whether they
conform to the requirements of this Agreement or such other Basic
Document; provided, however, that the Owner Trustee shall not be
responsible for the accuracy or content of any such resolution,
certificate, statement, opinion, report, document, order or other
instrument furnished to the Owner Trustee pursuant to this Agreement or
the other Basic Documents.
SECTION 7.2 Furnishing of Documents. The Owner Trustee shall furnish to
the Certificateholders 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 7.3 Representations and Warranties. The Owner Trustee hereby
represents and warrants to the Depositor, for the benefit of the
Certificateholders, that:
(a) It is a banking corporation duly organized and
validly existing in good standing under the laws of the State
of Delaware and having an office within the State of Delaware.
It has all requisite corporate power, authority and legal
right 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 nor the delivery by it of
this Agreement, nor the consummation by it of the
transactions contemplated hereby nor compliance by it
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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, writ, decree or order applicable to it, or
constitute any default under its charter documents or by-laws
or, with or without notice or lapse of time, any indenture,
mortgage, contract, agreement or instrument to which it is a
party or by which any of its properties may be bound.
(d) The execution, delivery and performance by the
Owner Trustee of this Agreement does not require the
authorization, consent, or approval of, the giving of notice
to, the filing or registration with, or the taking of any
other action in respect of, any governmental authority or
agency of the State of Delaware or the United States of
America regulating the corporate trust activities of the Owner
Trustee.
(e) This Agreement has been duly authorized, executed
and delivered by the Owner Trustee and shall constitute the
legal, valid, and binding agreement of the Owner Trustee,
enforceable in accordance with its terms, except as such
enforcement may be limited by bankruptcy, insolvency,
reorganization and other laws affecting the rights of
creditors generally, and by general principles of equity
regardless of whether enforcement is pursuant to a proceeding
in equity or at law.
SECTION 7.4 Reliance; Advice of Counsel. (a) 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 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 the 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, secretary 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 (i) 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
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such agents or attorneys shall have been selected by the Owner Trustee with due
care and (ii) may consult with counsel, accountants and other skilled persons
knowledgeable in the relevant area 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 7.5 Not Acting in Individual Capacity. Except as provided in
this Article VII, in accepting the trusts hereby created,
_______________________ acts solely as the 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 7.6 Owner Trustee May Own Certificates and Notes. The Owner
Trustee in its individual or any other capacity may become the owner or pledgee
of the Certificates or the Notes and may deal with the Depositor, the Indenture
Trustee and the Servicer in banking transactions with the same rights as it
would have if it were not the Owner Trustee.
ARTICLE VIII
COMPENSATION OF OWNER TRUSTEE
SECTION 8.1 Owner Trustee's Fees and Expenses. In accordance with
Section 4.7 of the Sale and Servicing Agreement, 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 Servicer and the Owner Trustee,
and the Owner Trustee shall be entitled to be reimbursed by the Servicer 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 except any such expenses as may arise
from its gross negligence, wilful misfeasance, or bad faith or that is the
responsibility of Certificateholders under this Agreement.
SECTION 8.2 Indemnification. In accordance with Section 4.7 of the Sale
and Servicing Agreement, the Servicer shall be liable as primary obligor for,
and shall indemnify the Owner Trustee (in such capacity or individually) 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,
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incurred by, or asserted against the Owner Trustee or any Indemnified Party in
any way relating to or arising out of this Agreement, the other 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 Servicer
shall not be liable for or required to indemnify the Owner Trustee from and
against Expenses arising or resulting from any of the matters described in the
third sentence of Section 7.1. The indemnities contained in this Section shall
survive the resignation or termination of the Owner Trustee or the termination
of this Agreement. If any suit, action, proceeding (including any governmental
or regulatory investigation), claim or demand shall be brought or asserted
against any Indemnified Party in respect of which indemnity may be sought
pursuant to this Section 8.2, such Indemnified Party shall promptly notify the
Servicer in writing, and the Servicer upon request of the Indemnified Party
shall retain counsel reasonably satisfactory to the Indemnified Party (or, with
the consent of the Servicer, counsel selected by the Indemnified Party
acceptable to the Servicer) to represent the Indemnified Party and any others
the Servicer may designate in such proceeding and shall pay the reasonable fees
and expenses of such counsel related to such proceeding. The Servicer shall not
be liable for any settlement of any claim or proceeding effected without its
written consent, but if settled with such consent or if there be a final
judgment for the plaintiff, the Servicer agrees to indemnify any Indemnified
Party from and against any loss or liability by reason of such settlement or
judgment. The Servicer shall not, without the prior written consent of the
Indemnified Party, effect any settlement of any pending or threatened proceeding
in respect of which any Indemnified Party is or could have been a party and
indemnity could have been sought hereunder by such Indemnified Party, unless
such settlement includes an unconditional release of such Indemnified Party from
all liability on claims that are the subject matter of such proceeding.
SECTION 8.3 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 9.1 Termination of Trust Agreement. (a) This Agreement (other
than Article VIII) and the Issuer shall terminate and be of no further force or
effect, on the Distribution Date next succeeding the month which is six months
after 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, including the
payment to the Certificateholders of all amounts required to be paid to them
pursuant to this Agreement; provided,
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however, that in no event shall the Trust created by this Agreement continue
beyond the expiration of 21 years from the death of the last survivor of the
descendants of Joseph P. Kennedy, the late ambassador to the Court of St.
James's, living on the date of this Agreement. The bankruptcy, liquidation,
dissolution, death or incapacity of any Certificateholder or Certificate Owner
shall not (x) operate to terminate this Agreement or the Issuer, nor (y) entitle
such Certificateholder's or Certificate 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 Issuer or the Owner Trust
Estate nor (z) otherwise affect the rights, obligations and liabilities of the
parties hereto.
(b) Except as provided in clause (a), neither the Depositor
nor any Certificateholder shall be entitled to revoke or terminate
the Trust.
(c) Notice of any termination of the Issuer, specifying the
Distribution Date upon which the Certificateholders shall surrender their
Certificates to the Owner Trustee or the Paying Agent for payment of the final
distribution and cancellation, shall be given by the Owner Trustee by letter to
the Certificateholders mailed within five Business Days of receipt of notice of
such termination from the Servicer given pursuant to Section 9.1(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 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 Owner Trustee or 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 Owner Trustee or 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 the Certificateholders. Upon presentation and surrender of the
Certificates, the Owner Trustee or the Paying Agent shall cause to be
distributed to the Certificateholders amounts distributable on such Distribution
Date pursuant to Section 5.2.
If 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
subject to this
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Agreement. Any funds remaining in the Owner Trust Estate after exhaustion of
such remedies shall be distributed, subject to applicable escheat laws, by the
Owner Trustee to the Depositor.
(d) Any funds remaining in the Issuer after funds for final
distribution have been distributed or set aside for distribution shall be
distributed by the Owner Trustee to the Depositor.
(e) Upon the winding up of the Issuer and its termination, the Owner
Trustee shall cause the Certificate of Trust to be canceled 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 10.1 Eligibility Requirements for Owner Trustee. The Owner
Trustee shall at all times be a corporation authorized to exercise corporate
trust powers; and having a combined capital and surplus of at least $100,000,000
and subject to supervision or examination by Federal or state authorities. If
such corporation shall publish reports of condition at least annually, pursuant
to law or to the requirements of the aforesaid supervising or examining
authority, then for the purpose of this Section, 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 10.2. In addition, at all
times the Owner Trustee or a co-trustee shall be a person that satisfies the
requirements of Section 3807(a) of the Business Trust Statute (the "Delaware
Trustee").
SECTION 10.2 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 10.1 and shall fail to resign after
written request therefor by the Administrator, or if
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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 which instrument shall be delivered to the outgoing Owner Trustee so
removed and one copy of which shall be delivered to the successor Owner Trustee,
and payment of all fees owed to the outgoing Owner Trustee shall be made 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 10.3 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 10.3 Successor Owner Trustee. Any successor Owner Trustee
appointed pursuant to Section 10.2 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 the 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 10.1.
Upon acceptance of appointment by a successor Owner Trustee pursuant to
this Section, the Administrator shall mail notice of the successor of such Owner
Trustee to all Certificateholders, the Trustee, the Noteholders and the Rating
Agencies. If the Administrator shall fail to mail such notice within 10 days
after acceptance of appointment by the successor Owner Trustee, the
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successor Owner Trustee shall cause such notice to be mailed at the expense of
the Administrator.
SECTION 10.4 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 form 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, provided such corporation shall be eligible pursuant to Section 10.1,
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 further that the Owner Trustee shall mail notice of
such merger or consolidation to the Rating Agencies.
SECTION 10.5 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 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 Owner Trustee to act as co-trustee, jointly with the Owner
Trustee, or 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 Issuer, 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. If the Delaware Trustee shall become incapable
of acting, resign or be removed, unless the Owner Trustee is qualified to act as
the Delaware Trustee, a successor co-trustee shall promptly be appointed in the
manner specified in this Section 10.5 to act as the Delaware Trustee. No
co-trustee or separate trustee under this Agreement shall be required to meet
the terms of eligibility as a successor trustee pursuant to Section 10.1 and no
notice of the appointment of any co-trustee or separate trustee shall be
required pursuant to Section 10.3.
Each separate trustee and co-trustee shall, to the extent permitted by
law, be appointed and act subject to the following provisions and conditions:
(i) all rights, powers, duties and obligations conferred or
imposed upon the 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),
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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 Issuer 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;
(ii) no trustee under this Agreement shall be personally
liable by reason of any act or omission of any other trustee under this
Agreement; and
(iii) 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 lawful act under or in respect of this
Agreement on its behalf and in its name. If any separate trustee or co-trustee
shall 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 trustee.
ARTICLE XI
MISCELLANEOUS
SECTION 11.1 Supplements and Amendments. This Agreement may be amended
by the Depositor 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 or defect, 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
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Agreement or of modifying in any manner the rights of the Noteholders or the
Certificateholders; provided that such action shall not, as evidenced by an
Opinion of Counsel, materially and adversely affect the interests of any
Noteholder or Certificateholder; provided, further, that the Depositor shall
deliver written notice of such amendments to each Rating Agency prior to the
execution of any such amendment. Notwithstanding the foregoing, no amendment
modifying the provisions of Section 5.2 shall become effective without
satisfaction of the Rating Agency Condition.
This Agreement may also be amended from time to time by the Depositor
and the Owner Trustee, with prior written notice to the Rating Agencies, with
the consent of the Holders of Notes evidencing not less than a majority of the
Outstanding Amount of the Notes and, to the extent affected thereby, the consent
of the Holders of 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 modifying
in any manner the rights of the Noteholders or the Certificateholders; provided
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 the 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 and the Certificate Balance required to
consent to any such amendment.
Promptly after the execution of any 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 the
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. The manner of obtaining such consents (and any
other consents of the Certificateholders provided for in this Agreement or in
any other Basic Document) and of evidencing the authorization of the execution
thereof by the 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 the
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 the 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,
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enter into any such amendment which affects the Owner Trustee's own rights,
duties or immunities under this Agreement or otherwise.
SECTION 11.2 No Legal Title to Owner Trust Estate in
Certificateholders. The Certificateholders shall not have legal title to any
part of the Owner Trust Estate. The Certificateholders 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 Certificateholders 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 11.3 Limitations on Rights of Others. Except for
Sections 2.7 and 2.10, the provisions of this Agreement are solely for the
benefit of the Owner Trustee, the Depositor, the Certificateholders 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 11.4 Notices. (a) Unless otherwise expressly specified or
permitted by the terms hereof, all notices shall be in writing and shall be
deemed given upon receipt personally delivered, delivered by overnight courier
or mailed certified mail, return receipt requested and shall be deemed to have
been duly given upon receipt, if to the Owner Trustee, addressed to
_______________________, ___________________________________, Attn:
__________________, if to the Depositor, addressed to, Chase Manhattan Bank USA,
National Association, c/o Chase Manhattan Automotive Finance Corporation,
900 Stewart Avenue, Garden City, New York 11530, Attn: Financial Controller; 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, regardless of whether the Certificateholder receives such notice.
SECTION 11.5 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.
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SECTION 11.6 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 11.7 Successors and Assigns. All covenants and agreements
contained herein shall be binding upon, and inure to the benefit of, the
Depositor, the Owner Trustee and its successors and each Certificateholder and
its successors and permitted assigns, all as herein provided. Any request,
notice, direction, consent, waiver or other instrument or action by a
Certificateholder shall bind the successors and assigns of such
Certificateholder.
SECTION 11.8 No Recourse. Each Certificateholder by accepting a
Certificate acknowledges that such Certificateholder's Certificates represent
equity interests in the Issuer only and do not represent interests in or
obligations of the Depositor, the Servicer, 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 other Basic Documents.
SECTION 11.9 [Reserved].
SECTION 11.10 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 11.11 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 11.12 Certificate Transfer Restrictions. (a) The
Certificates may not be acquired by or for the account of (i) an employee
benefit plan (as defined in Section 3(3) of the Employee Retirement Income
Security Act of 1974, as amended ("ERISA")) which is subject to the provisions
of Title I of ERISA, (ii) a plan (as defined in Section 4975(e)(1) of the Code
other than a governmental or church plan described in Section 4975(g)(2) or (3)
of the Code), or (iii) any entity whose underlying assets include "plan assets"
by reason of any such plan's investment in the entity (excluding any investment
company that is registered under the Investment Company Act of 1940, as amended)
(each, a "Benefit Plan"). By accepting and holding a Certificate, the Holder
thereof shall be deemed to have represented and warranted that it is not a
Benefit Plan, and that no assets of a Benefit Plan were used to acquire the
Certificate. The foregoing restrictions shall not apply to acquisitions or
holdings of Certificates with assets of the general account of an insurance
company, to the extent that the acquisition or holding, respectively, of such
Certificates (i) is and will be permissible under Section 401(c) of ERISA and
final regulations
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thereunder or another exemption under ERISA and (ii) does not and will not
result in the contemplated operations of the Trust being treated as non-exempt
prohibited transactions.
(b) The Certificates may not be acquired by or for the account of an
individual or entity that is not a U.S. person as defined in Section 7701(a)(30)
of the Code and any transfer of a Certificate to a person that is not a U.S.
Person shall be void. By accepting and holding a Certificate, the Holder shall
be deemed to have represented and warranted under penalties of perjury that it
(or, if it is acting as a nominee, the beneficial owner) is a U.S. Person.
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IN WITNESS WHEREOF, the parties hereto have caused this Trust Agreement
to be duly executed by their respective officers hereunto duly authorized as of
the day and year first above written.
-------------------------------------
as Owner Trustee
By: _________________________________
Name:
Title:
CHASE MANHATTAN BANK USA, N.A.,
as Depositor
By: _____________________________
Name:
Title:
<PAGE>
EXHIBIT A
NUMBER $
R- CUSIP NO. _________
[UNLESS THIS CERTIFICATE 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
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.]
THIS CERTIFICATE MAY NOT BE ACQUIRED BY OR FOR THE ACCOUNT OF (i) AN
EMPLOYEE BENEFIT PLAN (AS DEFINED IN SECTION 3(3) OF THE EMPLOYEE RETIREMENT
INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA")) WHICH IS SUBJECT TO THE
PROVISIONS OF TITLE I OF ERISA, (ii) A PLAN (AS DEFINED IN SECTION 4975(e)(1) OF
THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE "CODE") OTHER THAN A PLAN
DESCRIBED IN SECTION 4975(g)(2) OR (3) OF THE CODE), OR (iii) ANY ENTITY WHOSE
UNDERLYING ASSETS INCLUDE "PLAN ASSETS" BY REASON OF A PLAN'S INVESTMENT IN THE
ENTITY (EXCLUDING ANY INVESTMENT COMPANY THAT IS REGISTERED UNDER THE INVESTMENT
COMPANY ACT OF 1940, AS AMENDED) (EACH, A "PLAN"). BY ACCEPTING AND HOLDING THIS
CERTIFICATE, THE HOLDER HEREOF AND THE CERTIFICATE OWNER SHALL EACH BE DEEMED TO
HAVE REPRESENTED AND WARRANTED THAT IT IS NOT SUCH A PLAN AND THAT NO ASSETS OF
SUCH A PLAN WERE USED TO ACQUIRE THIS CERTIFICATE. THE FOREGOING RESTRICTIONS
SHALL NOT APPLY TO ACQUISITIONS OR HOLDINGS OF CERTIFICATES WITH ASSETS OF THE
GENERAL ACCOUNT OF AN INSURANCE COMPANY, TO THE EXTENT THAT THE ACQUISITION OR
HOLDING, RESPECTIVELY, OF SUCH CERTIFICATES (i) IS AND WILL BE PERMISSIBLE UNDER
SECTION 401(c) OF ERISA AND FINAL REGULATIONS THEREUNDER OR ANOTHER EXEMPTION
UNDER ERISA AND (ii) DOES NOT AND WILL NOT RESULT IN THE CONTEMPLATED OPERATIONS
OF THE TRUST BEING TREATED AS NON-EXEMPT PROHIBITED TRANSACTIONS.
THE CERTIFICATES MAY NOT BE ACQUIRED BY OR FOR THE ACCOUNT OF AN
INDIVIDUAL OR ENTITY THAT IS NOT A U.S. PERSON AS DEFINED IN SECTION 7701(A)(30)
OF THE CODE. BY ACCEPTING AND HOLDING A CERTIFICATE, THE HOLDER SHALL BE DEEMED
TO HAVE REPRESENTED AND WARRANTED THAT IT (OR, IF IT IS ACTING AS A NOMINEE, THE
BENEFICIAL OWNER) IS A U.S. PERSON.
THE PRINCIPAL OF THIS CERTIFICATE IS DISTRIBUTABLE IN INSTALLMENTS AS
SET FORTH IN THE TRUST AGREEMENT. ACCORDINGLY, THE OUTSTANDING PRINCIPAL OF
THIS CERTIFICATE AT ANY TIME MAY BE LESS THAN THE AMOUNT SHOWN ON THE FACE
HEREOF.]
Exhibit A, Page 1
<PAGE>
CHASE MANHATTAN AUTO OWNER TRUST 199_-_
_____% ASSET BACKED CERTIFICATE
evidencing a beneficial ownership interest in certain distributions of the
Issuer, as defined below, the property of which includes a pool of retail
installment sales contracts or purchase money notes and security agreements and
other notes secured by new or used automobiles or light duty trucks and sold to
the Issuer by Chase Manhattan Bank USA, N.A., a national banking association.
(This Certificate does not represent an interest in or obligation of Chase
Manhattan Bank USA, N.A. or any of its Affiliates, except to the extent
described below.)
THIS CERTIFIES THAT ___________________________ is the registered owner
of ___________________________ nonassessable, fully-paid, beneficial ownership
interest in certain distributions of Chase Manhattan Auto Owner Trust 199_-_
(the "Issuer") formed by Chase Manhattan Bank USA, N.A., a national banking
association (the "Depositor"). This Certificate has a Certificate Rate of %
per annum.
Exhibit A, Page 2
<PAGE>
OWNER TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Trust Agreement.
- - - ------------------------- --------------------------
or
as Owner Trustee as Owner Trustee
By: ________________________ By: ______________________
Authenticating Agent
Exhibit A, Page 3
<PAGE>
Issuer was created pursuant to a Trust Agreement dated as of __________
__, 199_ (the "Trust Agreement"), between the Depositor and ___________________,
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
Section 1.1 of the Sale and Servicing Agreement between the Issuer and Chase
Manhattan Bank USA, N.A., as Seller and Servicer, dated as of __________ __,
199_, as the same may be amended or supplemented from time to time (the "Sale
and Servicing Agreement").
This Certificate is one of the duly authorized Certificates of the
Issuer designated as "____% Asset Backed Certificates" (herein called the
"Certificates"). Issued under the Indenture dated as of __________ __, 199_,
between the Issuer and Norwest Bank Minnesota, National Association, as trustee
(the "Indenture"), are five classes of Notes designated as "Class A-1 _____%
Asset Backed Notes" (the "Class A-1 Notes"), "Class A-2 _____% Asset Backed
Notes" (the "Class A-2 Notes"), "Class A-3 _____% Asset Backed Notes" (the
"Class A-3 Notes"), "Class A-4 _____% Asset Backed Notes" (the "Class A-4
Notes"), and "Class [A-5][B] _____% Asset Backed Notes" (the "Class [A-5] [B]
Notes" and, together with the Class A-1 Notes, the Class A-2 Notes, the Class
A-3 Notes and the Class A-4 Notes, the "Notes"). This 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 Certificate by virtue of
the acceptance hereof assents and by which such holder is bound.
The holder of this Certificate acknowledges and agrees that its rights
to receive distributions in respect of this Certificate are subordinated to the
rights of the Noteholders as described in the Sale and Servicing Agreement, the
Indenture and the Trust Agreement, as applicable.
It is the intent of the Depositor and Certificateholders that, for
United States federal income tax purposes, the Issuer will be treated as a
partnership and the Depositor and the Certificateholders will be treated as
partners in that partnership. The Certificateholders by acceptance of a
Certificate, agree to treat, and to take no action inconsistent with the
treatment of, the Certificates for such tax purposes as equity (i.e.,
partnership interests) in the Issuer.
Each Certificateholder, by its acceptance of a Certificate or a
beneficial interest in a Certificate, acknowledges and agrees that neither the
Depositor nor the Owner Trustee is authorized to elect to treat the Issuer other
than as a partnership for United States federal income tax purposes or any
relevant state tax purposes. Each Certificateholder, by its acceptance of a
Certificate or a beneficial interest in a Certificate, agrees not to take any
actions (or direct the Owner Trustee to take such acts or actions) that would
violate such restriction.
Exhibit A, Page 4
<PAGE>
The Certificates do not represent an obligation of, or an interest in,
the Depositor, the Servicer, the Owner Trustee, the Indenture Trustee or any
Affiliates of any of them and no recourse may be had against such parties or
their assets, except as may be expressly set forth or contemplated herein or in
the Trust Agreement, the Indenture or the other Basic Documents.
This certificate may not be acquired by or for the account of (i) an
employee benefit plan (as defined in section 3(3) of the employee retirement
income security act of 1974, as amended ("ERISA")) which is subject to the
provisions of Title I of ERISA, (ii) a plan (as defined in Section 4975(e)(1) of
the Internal Revenue Code of 1986, as amended (the "Code") other than a plan
described in Section 4975(g)(2) or (3) of the Code), or (iii) any entity whose
underlying assets include "plan assets" by reason of a plan's investment in the
entity (excluding any investment company that is registered under the Investment
Company Act of 1940, as amended) (each, a "Plan"). By accepting and holding this
Certificate, the holder hereof and the Certificate Owner shall each be deemed to
have represented and warranted that it is not such a Plan and that no assets of
such a Plan were used to acquire this Certificate. The foregoing restrictions
shall not apply to acquisitions or holdings of Certificates with assets of the
general account of an insurance company, to the extent that the acquisition or
holding, respectively, of such Certificates (i) is and will be permissible under
Section 401(c) of ERISA and final regulations thereunder or another exemption
under ERISA and (ii) does not and will not result in the contemplated operations
of the Trust being treated as non-exempt prohibited transactions.
The Certificates may not be acquired by or for the account of an
individual or entity that is not a U.S. Person as defined in Section 7701(A)(30)
of the Code. By accepting and holding a Certificate, the Holder shall be deemed
to have represented and warranted that it (or, if it is acting as a nominee, the
Beneficial Owner) is a U.S. Person.
Unless the certificate of authentication hereon shall have been
executed by an authorized officer of the Owner Trustee or the Authentication
Agent, by manual or facsimile signature, this 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 CERTIFICATE SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE
STATE OF DELAWARE, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE
DETERMINED IN ACCORDANCE WITH SUCH LAWS.
Exhibit A, Page 5
<PAGE>
IN WITNESS WHEREOF, the Owner Trustee, on behalf of Issuer and not in
its individual capacity, has caused this Certificate to be duly executed.
CHASE MANHATTAN AUTO
OWNER TRUST 199_-_
By: ________________________________
not in its individual
capacity, but solely as
Owner Trustee
Dated: By: ________________________________
Exhibit A, Page 6
<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 Certificate, and all rights thereunder, hereby irrevocably
constituting and appointing ____________________ as Attorney to transfer said
Certificate on the books of the Certificate Registrar, with full power of
substitution in the premises.
Dated:
*
---------------------------------
Signature Guaranteed:
*
---------------------------------
- - - ------------
* NOTICE: The signature to this assignment must correspond with the name of
the registered owner as it appears on the face of the within Certificate in
every particular, without alteration, enlargement or any change whatever.
Such signature must be guaranteed by a member firm of the New York Stock
Exchange or a commercial bank or trust company.
Exhibit A, Page 7
<PAGE>
EXHIBIT B
CERTIFICATE OF TRUST
Exhibit B, Page 1
<PAGE>
EXHIBIT C
CERTIFICATE DEPOSITORY AGREEMENT
Exhibit C, Page 1
<PAGE>
FORM OF ADMINISTRATION AGREEMENT
- - - -------------------------------------------------------------------------------
CHASE MANHATTAN AUTO OWNER TRUST 199_-_
Class A-1 _____% Asset Backed Notes
Class A-2 _____% Asset Backed Notes
Class A-3 _____% Asset Backed Notes
Class A-4 _____% Asset Backed Notes
Class [A-5][B] _____% Asset Backed Notes
------------------------------------
ADMINISTRATION AGREEMENT
Dated as of _________ __, 199_
------------------------------------
________________________
Administrator
- - - -------------------------------------------------------------------------------
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
----
<S> <C>
1. Duties of Administrator............................................................................ 2
2. Records............................................................................................ 8
3. Compensation....................................................................................... 8
4. Additional Information To Be Furnished to Issuer................................................... 8
5. Independence of Administrator...................................................................... 8
6. No Joint Venture................................................................................... 8
7. Other Activities of Administrator.................................................................. 8
8. Term of Agreement; Resignation and Removal of
Administrator................................................................................. 9
9. Action upon Termination, Resignation or Removal.................................................... 10
10. Notices........................................................................................... 11
11. Amendments........................................................................................ 12
12. Successors and Assigns............................................................................ 12
13. GOVERNING LAW..................................................................................... 13
14. Headings.......................................................................................... 13
15. Counterparts...................................................................................... 13
16. Severability...................................................................................... 13
17. Not Applicable to _____________________________ in
Other Capacities.................................................................................. 13
18. Limitation of Liability of Owner Trustee, Indenture
Trustee and Administrator......................................................................... 13
19. Third-Party Beneficiary........................................................................... 14
21. Nonpetition Covenants............................................................................. 14
22. Liability of Administrator.........................................................................14
</TABLE>
EXHIBIT A - Form of Power of Attorney
i
<PAGE>
ADMINISTRATION AGREEMENT dated as of __________ __, 199_, among CHASE
MANHATTAN AUTO OWNER TRUST 199-_, a Delaware business trust (the "Issuer"),
________________________, a _______________________ banking corporation, as
administrator (the "Administrator"), and _________________________________, a
___________________ banking association, not in its individual capacity but
solely as Indenture Trustee (the "Indenture Trustee").
W I T N E S S E T H :
WHEREAS the Issuer is issuing the Class A-1 _____% Asset Backed Notes
(the "Class A-1 Notes"), the Class A-2 _____% Asset Backed Notes (the "Class A-2
Notes"), the Class A-3 _____% Asset Backed Notes (the "Class A-3 Notes"), the
Class A-4 _____% Asset Backed Notes (the "Class A-4 Notes") and the Class
[A-5][B] _____% Asset Backed Notes (the "Class [A-5][B] Notes" and, together
with the Class A-1 Notes, the Class A-2 Notes, the Class A-3 Notes and the Class
A-4 Notes, the "Notes") pursuant to the Indenture dated as of _________ __, ____
(as amended, modified or supplemented from time to time in accordance with the
provisions thereof, the "Indenture"), between the Issuer and the Indenture
Trustee and the ______% Asset Backed Certificates (the "Certificates") pursuant
to the Trust Agreement dated as of _________ __, ____ (as amended, modified or
supplemented from time to time in accordance with the provisions thereof, the
"Trust Agreement") between Chase USA (defined below), as Depositor, and
________________________, as owner trustee (the "Owner Trustee").
WHEREAS the Issuer has entered into certain agreements in connection
with the issuance of the Notes and the Certificates, including (i) a Sale and
Servicing Agreement dated as of _________ __, ____ (the "Sale and Servicing
Agreement") (capitalized terms used herein and not defined herein shall have the
meanings assigned such terms in the Sale and Servicing Agreement) between the
Issuer and Chase Manhattan Bank USA, National Association ("Chase USA"), as
Servicer and Seller, (ii) a Depository Agreement dated __________ __, ____ (the
"Note Depository Agreement") among the Issuer, the Indenture Trustee,
________________, as Agent (the "Agent") and The Depository Trust Company [,]
[and (iii) [a Depository Agreement dated __________ __, ____ among the Issuer,
the Owner Trustee, the Agent and The Depository Trust Company (the "Certificate
Depository Agreement," and together with the Note Depository Agreement, the
"Depository Agreements"),] (iv) [(iii)] the Trust Agreement, and (v) [(iv)] the
Indenture (the Sale and Servicing Agreement, the Trust Agreement, the Depository
Agreement[s] and the Indenture being hereinafter referred to collectively as the
"Related Agreements");
WHEREAS pursuant to the Related Agreements, the Issuer and the Owner
Trustee are required to perform certain duties in connection
<PAGE>
with (a) the Notes and the collateral pledged therefor pursuant to
the Indenture (the "Collateral") and (b) the Certificates;
WHEREAS the Issuer desires to have the Administrator perform certain of
the duties of the Issuer and the Owner Trustee referred to in the preceding
clause, and to provide such additional services consistent with the terms of
this Agreement and the Related Agreements as the Issuer may from time to time
request;
WHEREAS the Administrator has the capacity to provide the services
required hereby and is willing to perform such services for the Issuer and the
Owner Trustee on the terms set forth herein;
NOW, THEREFORE, in consideration of the mutual covenants contained
herein, and other good and valuable consideration, the receipt and adequacy of
which are hereby acknowledged, the parties agree as follows:
1. Duties of Administrator. (a) Duties with Respect to the Related
Agreements. (i) The Administrator agrees to perform all its duties as
Administrator and the duties of the Issuer and the Owner Trustee under the
Depository Agreement[s]. In addition, the Administrator shall consult with the
Owner Trustee regarding the duties of the Issuer and the Owner Trustee under the
Related Agreements.
The Administrator shall monitor the performance of the Issuer and shall
advise the Owner Trustee when action is necessary to comply with the Issuer's or
the Owner Trustee's duties under the Indenture and the Depository Agreement[s].
The Administrator shall prepare for execution by the Issuer or the Owner Trustee
or shall cause the preparation by other appropriate persons of all such
documents, reports, filings, instruments, certificates and opinions as it shall
be the duty of the Issuer or the Owner Trustee to prepare, file or deliver
pursuant to the Indenture and the Depository Agreement[s]. In furtherance of the
foregoing, the Administrator shall take all appropriate action that it is the
duty of the Issuer or the Owner Trustee to take pursuant to the Indenture
including, without limitation, such of the foregoing as are required with
respect to the following matters under the Indenture (references are to sections
of the Indenture):
(A) the preparation of or obtaining of the documents and
instruments required for authentication of the Notes, if any, and
delivery of the same to the Indenture Trustee (Section 2.2);
(B) the duty to cause the Note Register to be kept and to give
the Indenture Trustee notice of any appointment of a new Note Registrar
and the location, or change in location, of the Note Register and the
office or offices where Notes may be
2
<PAGE>
surrendered for registration of transfer or exchange (Section
2.4);
(C) the notification of Noteholders of the final
principal payment on their Notes (Section 2.7(b));
(D) the preparation, obtaining or filing of the
instruments, opinions and certificates and other documents
required for the release of collateral (Section 2.9);
(E) the preparation of Definitive Notes and arranging
the delivery thereof (Section 2.12);
(F) the maintenance of an office or agency in the City of New
York and, if applicable, Luxembourg, for registration of transfer or
exchange of Notes (Section 3.2);
(G) the duty to cause newly appointed Paying Agents, if any,
to deliver to the Indenture Trustee the instrument specified in the
Indenture regarding funds held in trust (Section 3.3);
(H) the direction to Paying Agents to pay to the
Indenture Trustee all sums held in trust by such Paying Agents
(Section 3.3);
(I) the obtaining and preservation of the Issuer's
qualification to do business in each jurisdiction in which such
qualification is or shall be necessary to protect the validity and
enforceability of the Indenture, the Notes, the Collateral and each
other instrument and agreement included in the Trust Estate (Section
3.4);
(J) the preparation of all supplements, amendments, financing
statements, continuation statements, if any, instruments of further
assurance and other instruments, in accordance with Section 3.5 of the
Indenture, necessary to protect the Trust Estate (Section 3.5);
(K) the obtaining of the Opinion of Counsel on the Closing
Date and the annual delivery of Opinions of Counsel, in accordance with
Section 3.6 of the Indenture, as to the Trust Estate, and the annual
delivery of the Officers' Certificate and certain other statements, in
accordance with Section 3.9 of the Indenture, as to compliance with the
Indenture (Sections 3.6 and 3.9);
(L) the identification to the Indenture Trustee in an
Officers' Certificate of a Person with whom the Issuer has contracted
to perform its duties under the Indenture (Section 3.7(b));
3
<PAGE>
(M) the notification of the Indenture Trustee and the Rating
Agencies of an Event of Servicing Termination pursuant to the Sale and
Servicing Agreement and, if such Event of Servicing Termination arises
from the failure of the Servicer to perform any of its duties under the
Sale and Servicing Agreement, the taking of all reasonable steps
available to remedy such failure (Section 3.7(d));
(N) the preparation and obtaining of documents and instruments
required for the release of the Issuer from its obligation under the
Indenture (Section 3.11(b));
(O) the delivery of notice to the Indenture Trustee of each
Event of Default, Event of Servicing Termination and each default by
the Seller under the Sale and Servicing Agreement (Section 3.18);
(P) the taking of such further acts as may be reasonably
necessary or proper to carry out more effectively the purpose of the
Indenture or to compel or secure the performance and observance by the
Seller and the Servicer of their obligations under the Sale and
Servicing Agreement (Sections 3.19 and 5.16);
(Q) the monitoring of the Issuer's obligations as to the
satisfaction and discharge of the Indenture and the preparation of an
Officers' Certificate and the obtaining of the Opinion of Counsel and
the Independent Certificate relating thereto (Section 4.1);
(R) the compliance with any written directive of the Indenture
Trustee with respect to the sale of the Trust Estate in any manner
permitted by law if an Event of Default shall have occurred and be
continuing (Section 5.4);
(S) provide the Indenture Trustee with the information
necessary to deliver to each Noteholder such information as may be
reasonably required to enable such Holder to prepare its United States
federal and state and local income or franchise tax returns (Section
6.6);
(T) the preparation and delivery of notice to Noteholders of
the removal of the Indenture Trustee and the appointment of a
successor Indenture Trustee (Section 6.8);
(U) the preparation of any written instruments required to
confirm more fully the authority of any co-trustee or separate trustee
and any written instruments necessary in connection with the
resignation or removal of the Indenture Trustee or any co-trustee or
separate trustee (Sections 6.8 and 6.10);
4
<PAGE>
[(V) the preparation of a supplemental indenture to confirm the
appointment of a successor Indenture Trustee with respect to the Class
A Notes and/or the Class B Notes and any other written instruments
necessary in connection with the resignation of the Indenture Trustee
(Section 6.11)]
(W) the furnishing of the Indenture Trustee with the names and
addresses of Noteholders during any period when the Indenture Trustee
is not the Note Registrar (Section 7.1);
(X) the preparation and, after execution by the Issuer, the
filing with the Commission and the Luxembourg Stock Exchange (if
applicable) any applicable state agencies and the Indenture Trustee of
documents required to be filed on a periodic basis with, and summaries
thereof as may be required by rules and regulations prescribed by, the
Commission and any applicable state agencies and the transmission of
such summaries, as necessary, to the Noteholders (Section 7.3);
(Y) the obtaining of an Officers' Certificate, Opinion of
Counsel and Independent Certificates, if necessary, for the release of
the Trust Estate as defined in the Indenture (Sections 8.4 and 8.5);
(Z) the preparation of Issuer Orders and Issuer Requests and
the obtaining of Opinions of Counsel with respect to the execution of
supplemental indentures and the mailing to the Noteholders of notices
with respect to such supplemental indentures (Sections 9.1 and 9.2);
(AA) the execution of new Notes conforming to any
supplemental indenture (Section 9.5);
(BB) provide the Indenture Trustee with the form of notice
necessary to deliver the notification of Noteholders and the Luxembourg
Stock Exchange (if applicable) of redemption of the Notes (Section
10.2);
(CC) the preparation of all Officers' Certificates, Opinions
of Counsel and Independent Certificates with respect to any requests by
the Issuer to the Indenture Trustee to take any action under the
Indenture (Section 11.1(a));
(DD) the preparation and delivery of Officers' Certificates
and the obtaining of Independent Certificates, if necessary, for the
release of property from the lien of the Indenture (Section 11.1(b));
(EE) the preparation and delivery to the Noteholders and the
Indenture Trustee of any agreements with respect to alternate payment
and notice provisions (Section 11.6);
5
<PAGE>
(FF) the recording of the Indenture, if applicable
(Section 11.15); and
(b) Additional Duties. (i) In addition to the duties of the
Administrator set forth above, the Administrator shall perform such calculations
and shall prepare for execution by the Issuer or the Owner Trustee or shall
cause the preparation by other appropriate persons of all such documents,
reports, filings, instruments, certificates and opinions as it shall be the duty
of the Issuer or the Owner Trustee to prepare, file or deliver pursuant to the
Related Agreements, and at the request of the Owner Trustee shall take all
appropriate action that it is the duty of the Issuer or the Owner Trustee to
take pursuant to the Related Agreements. Subject to Section 5 of this Agreement,
and in accordance with the directions of the Owner Trustee, the Administrator
shall administer, perform or supervise the performance of such other activities
in connection with the Trust Estate (including the Related Agreements) as are
not covered by any of the foregoing provisions and as are expressly requested by
the Owner Trustee and are reasonably within the capability of the Administrator.
(ii) Notwithstanding anything in this Agreement or the Related
Agreements to the contrary, the Administrator shall be responsible for promptly
notifying the Owner Trustee in the event that any withholding tax is imposed on
the Issuer's payments (or allocations of income) to a "Certificateholder" as
contemplated in Section 5.2(c) of the Trust Agreement. Any such notice shall
specify the amount of any withholding tax required to be withheld by the Owner
Trustee pursuant to such provision.
(iii) Notwithstanding anything in this Agreement or the Related
Agreements to the contrary, the Administrator shall be responsible for
performance of the duties of the Owner Trustee and the Issuer set forth in
Sections 2.11, 2.12, 2.13 and 5.5(a), (b) and (c) and 5.7 of the Trust Agreement
with respect to, among other things, accounting and reports to
Certificateholders and the maintenance of Capital Accounts; provided, however,
that the Owner Trustee shall retain responsibility for the distribution of the
Schedule K-1s necessary to enable each Certificateholder to prepare its federal
and state income tax returns.
(iv) The Administrator may satisfy its obligations with respect to
clauses (ii) and (iii) above by retaining, at the expense of the Administrator,
a firm of independent public accountants (the "Accountants") acceptable to the
Owner Trustee which shall perform the obligations of the Administrator
thereunder. In connection with paragraph (ii) above, the Accountants will
provide prior to _________ __, ____, a letter in form and substance satisfactory
to the Owner Trustee as to whether any tax withholding is then required and, if
required, the procedures to be followed with respect thereto to comply with the
requirements of the Code. The Accountants shall be required to
6
<PAGE>
update the letter in each instance that any additional tax withholding is
subsequently required or any previously required tax withholding shall no longer
be required.
(v) Reserved.
(vi) The Administrator shall perform the duties of the Administrator
specified in Sections 10.2 and 10.3 of the Trust Agreement required to be
performed in connection with the resignation or removal of the Owner Trustee,
the duties of the Administrator specified in Section 10.5 of the Trust Agreement
required to be performed in connection with the appointment and payment of
co-Trustees, and any other duties expressly required to be performed by the
Administrator under the Trust Agreement.
(vii) In carrying out the foregoing duties or any of its other
obligations under this Agreement, the Administrator may enter into transactions
with or otherwise deal with any of its Affiliates; provided, however, that the
terms of any such transactions or dealings shall be in accordance with any
directions received from the Issuer and shall be, in the Administrator's
opinion, no less favorable to the Issuer than would be available from
unaffiliated parties.
(viii) It is the intention of the parties hereto that the Administrator
shall, and the Administrator hereby agrees to, execute on behalf of the Issuer
or the Owner Trustee all such documents, reports, filings, instruments,
certificates and opinions as it shall be the duty of the Issuer or the Owner
Trustee to prepare, file or deliver pursuant to the Basic Documents. In
furtherance thereof, the Owner Trustee shall, on behalf of itself and of the
Issuer, execute and deliver to the Administrator, and to each successor
Administrator appointed pursuant to the terms hereof, one or more powers of
attorney substantially in the form of Exhibit A hereto, appointing the
Administrator the attorney-in-fact of the Owner Trustee and the Issuer for the
purpose of executing on behalf of the Owner Trustee and the Issuer all such
documents, reports, filings, instruments, certificates and opinions.
(c) Non-Ministerial Matters. (i) With respect to matters that in the
reasonable judgment of the Administrator are non-ministerial, the Administrator
shall not take any action unless within a reasonable time before the taking of
such action, the Administrator shall have notified the Owner Trustee of the
proposed action and the Owner Trustee shall not have withheld consent or
provided an alternative direction. For the purpose of the preceding sentence,
"non-ministerial matters" shall include, without limitation:
7
<PAGE>
(A) the initiation of any claim or lawsuit by the Issuer and
the compromise of any action, claim or lawsuit brought by or against
the Issuer (other than in connection with the collection of the
Receivables);
(B) the amendment, change or modification of the Related
Agreements;
(C) the appointment of successor Note Registrars, successor
Paying Agents and successor Indenture Trustees pursuant to the
Indenture or the appointment of successor Administrators or successor
Servicers, or the consent to the assignment by the Note Registrar, the
Paying Agent or the Indenture Trustee of its obligations under the
Indenture; and
(D) the removal of the Indenture Trustee.
(ii) Notwithstanding anything to the contrary in this Agreement, the
Administrator shall not be obligated to, and shall not, (x) make any payments to
the Noteholders or Certificateholders under the Related Agreements, (y) sell the
Trust Estate pursuant to Section 5.4 of the Indenture or (z) take any action
that the Issuer directs the Administrator not to take on its behalf.
2. Records. The Administrator shall maintain appropriate books of
account and records relating to services performed hereunder, which books of
account and records shall be accessible for inspection by the Issuer, the Owner
Trustee, the Indenture Trustee and the Seller at any time during normal business
hours.
3. Compensation. As compensation for the performance of the
Administrator's obligations under this Agreement, the Administrator shall be
entitled to $_______ per month which shall be payable in accordance with Section
5.5 of the Sale and Servicing Agreement.
4. Additional Information To Be Furnished to Issuer. The Administrator
shall furnish to the Issuer from time to time such additional information
regarding the Collateral as the Issuer shall reasonably request, including
notification of Noteholders pursuant to Section 1(c) hereof.
5. Independence of Administrator. For all purposes of this Agreement,
the Administrator shall be an independent contractor and shall not be subject to
the supervision of the Issuer or the Owner Trustee with respect to the manner in
which it accomplishes the performance of its obligations hereunder. Unless
expressly authorized by the Issuer or the Owner Trustee, as the case may be, the
Administrator shall have no authority to act for or represent the Issuer or the
Owner Trustee in any way and shall not otherwise be deemed an agent of the
Issuer or the Owner Trustee.
8
<PAGE>
6. No Joint Venture. Nothing contained in this Agreement shall (i)
constitute the Administrator and either of the Issuer or the Owner Trustee as
members of any partnership, joint venture, association, syndicate,
unincorporated business or other separate entity, (ii) be construed to impose
any liability as such on any of them or (iii) be deemed to confer on any of them
any express, implied or apparent authority to incur any obligation or liability
on behalf of the others.
7. Other Activities of Administrator. (a) Nothing herein shall prevent
the Administrator or its affiliates from engaging in other businesses or, in its
sole discretion, from acting in a similar capacity as an administrator for any
other person or entity even though such person or entity may engage in business
activities similar to those of the Issuer, the Owner Trustee or the Indenture
Trustee.
(b) The Administrator and its affiliates may generally engage in any
kind of business with any person party to a Related Agreement, any of its
affiliates and any person who may do business with or own securities of any such
person or any of its affiliates, without any duty to account therefor to the
Issuer, the Owner Trustee or the Indenture Trustee.
8. Term of Agreement; Resignation and Removal of Administrator. (a)
This Agreement shall continue in force until the dissolution of the Issuer, upon
which event this Agreement shall automatically terminate.
(b) Subject to Sections 8(e) and (f), the Administrator may resign its
duties hereunder by providing the Issuer and the Owner Trustee with at least 60
days' prior written notice.
(c) Subject to Sections 8(e) and (f), the Issuer may remove the
Administrator without cause by providing the Administrator with at least 60
days' prior written notice.
(d) Subject to Sections 8(e) and (f), at the sole option of the Issuer,
the Administrator may be removed immediately upon written notice of termination
from the Issuer to the Administrator if any of the following events shall occur:
(i) the Administrator shall default in the performance of
any of its duties under this Agreement and, after notice of such
default, shall not cure such default within ten days (or, if such
default cannot be cured in such time, shall not give within ten days
such assurance of cure as shall be reasonably satisfactory to the
Issuer);
(ii) a court having jurisdiction in the premises shall enter
a decree or order for relief, and such decree or order shall not have
been vacated within 60 days, in respect of the
9
<PAGE>
Administrator in any involuntary case under any applicable bankruptcy,
insolvency or other similar law now or hereafter in effect or appoint a
receiver, liquidator, assignee, custodian, trustee, sequestrator or
similar official for the Administrator or any substantial part of its
property or order the winding-up or liquidation of its affairs; or
(iii) the Administrator shall commence a voluntary case under
any applicable bankruptcy, insolvency or other similar law now or
hereafter in effect, shall consent to the entry of an order for relief
in an involuntary case under any such law, or shall consent to the
appointment of a receiver, liquidator, assignee, trustee, custodian,
sequestrator or similar official for the Administrator or any
substantial part of its property, shall consent to the taking of
possession by any such official of any substantial part of its
property, shall make any general assignment for the benefit of
creditors or shall fail generally to pay its debts as they become due.
The Administrator agrees that if any of the events specified in clause
(ii) or (iii) of this Section shall occur, it shall give written notice thereof
to the Issuer, the Owner Trustee and the Indenture Trustee within seven days
after the happening of such event.
(e) No resignation or removal of the Administrator pursuant to this
Section shall be effective until (i) a successor Administrator shall have been
appointed by the Issuer and (ii) such successor Administrator shall have agreed
in writing to be bound by the terms of this Agreement in the same manner as the
Administrator is bound hereunder.
(f) The appointment of any successor Administrator shall be effective
only after receipt of written confirmation from each Rating Agency that the
proposed appointment will not result in the qualification, downgrading or
withdrawal of any rating assigned to the Notes [and Certificates] by such Rating
Agency.
(g) A successor Administrator shall execute, acknowledge and deliver a
written acceptance of its appointment hereunder to the resigning Administrator
and to the Issuer. Thereupon the resignation or removal of the resigning
Administrator shall become effective, and the successor Administrator shall have
all the rights, powers and duties of the Administrator under this Indenture. The
successor Administrator shall mail a notice of its succession to the Noteholders
and the Certificateholders. The resigning Administrator shall promptly transfer
or cause to be transferred all property and any related agreements, documents
and statements held by it as Administrator to the successor Administrator and
the resigning Administrator shall execute and deliver such instruments and do
other things as may reasonably be
10
<PAGE>
required for fully and certainly vesting in the successor Administrator all
rights, powers, duties and obligations hereunder.
(h) In no event shall a resigning Administrator be liable for the acts
or omissions of any successor Administrator hereunder.
(i) In the exercise or administration of its duties hereunder and under
the Related Documents, the Administrator may act directly or through its agents
or attorneys pursuant to agreements entered into with any of them, and the
Administrator 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
Administrator with due care.
9. Action upon Termination, Resignation or Removal. Promptly upon the
effective date of termination of this Agreement pursuant to Section 8(a) or the
resignation or removal of the Administrator pursuant to Section 8(b) or (c),
respectively, the Administrator shall be entitled to be paid all fees and
reimbursable expenses accruing to it to the date of such termination,
resignation or removal. The Administrator shall forthwith upon termination
pursuant to Section 8(a) deliver to the Issuer all property and documents of or
relating to the Collateral then in the custody of the Administrator. In the
event of the resignation or removal of the Administrator pursuant to Section
8(b) or (c), respectively, the Administrator shall cooperate with the Issuer and
take all reasonable steps requested to assist the Issuer in making an orderly
transfer of the duties of the Administrator.
10. Notices. Any notice, report or other communication given hereunder
shall be in writing and addressed as follows:
(a) if to the Issuer or the Owner Trustee, to
_______________________________________________________
_______________________________________________________
_______________________________________________________
_______________________________________________________
_______________________________________________________
with a copy to:
Chase Automotive Finance Corporation
900 Stewart Avenue
Garden City, New York 11530
Attention Financial Controller
11
<PAGE>
(b) if to the Administrator, to
The Chase Manhattan Bank
450 West 33rd Street
New York, New York 10001-2697
(c) if to the Indenture Trustee, to
_______________________________________________________
_______________________________________________________
_______________________________________________________
_______________________________________________________
(d) if to the Seller, to
Chase Manhattan Automotive Finance Corporation
900 Stewart Avenue
Garden City, New York 11530
Attention Financial Controller
or to such other address as any party shall have provided to the other parties
in writing. Any notice required to be in writing hereunder shall be deemed given
if such notice is mailed by certified mail, postage prepaid, or hand-delivered
to the address of such party as provided above, except that notices to the
Indenture Trustee are effective only upon receipt.
11. Amendments. This Agreement may be amended from time to time by a
written amendment duly executed and delivered by the Issuer, the Administrator
and the Indenture Trustee, with the written consent of the Owner Trustee and
without the consent of the Noteholders and the Certificateholders, 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 Certificateholders; provided that such amendment will not, as
evidenced by an Opinion of Counsel, materially and adversely affect the interest
of any Noteholder or Certificateholder. This Agreement may also be amended by
the Issuer, the Administrator and the Indenture Trustee with the written consent
of the Owner Trustee and the holders of Notes evidencing a majority in the
Outstanding Amount of the Notes and the holders of Certificates evidencing 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 Noteholders or the
Certificateholders; provided, however, that no such amendment may (i) increase
or reduce in any manner the amount of, or accelerate or delay the timing of,
collections of payments on Receivables or distributions that are required to be
made for the
12
<PAGE>
benefit of the Noteholders or Certificateholders or (ii) reduce the aforesaid
percentage of the holders of Notes and Certificates which are required to
consent to any such amendment, without the consent of the holders of all the
outstanding Notes and Certificates. Notwithstanding the foregoing, the
Administrator may not amend this Agreement without the permission of the Seller,
which permission shall not be unreasonably withheld.
12. Successors and Assigns. This Agreement may not be assigned by the
Administrator unless such assignment is previously consented to in writing by
the Issuer and the Owner Trustee and subject to receipt by the Owner Trustee of
written confirmation from each Rating Agency that such assignment will not
result in the qualification, downgrading or withdrawal of any rating assigned to
the Notes and Certificates by such Rating Agency in respect thereof. An
assignment with such consent and satisfaction, if accepted by the assignee,
shall bind the assignee hereunder in the same manner as the Administrator is
bound hereunder. Notwithstanding the foregoing, this Agreement may be assigned
by the Administrator without the consent of the Issuer or the Owner Trustee to a
corporation or other organization that is a successor (by merger, consolidation
or purchase of assets) to the Administrator, provided that such successor
organization executes and delivers to the Issuer, the Owner Trustee and the
Indenture Trustee an agreement in which such corporation or other organization
agrees to be bound hereunder by the terms of said assignment in the same manner
as the Administrator is bound hereunder. Subject to the foregoing, this
Agreement shall bind any successors or assigns of the parties hereto.
13. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE STATE
OF NEW YORK.
14. Headings. The section headings hereof have been inserted for
convenience of reference only and shall not be construed to affect the meaning,
construction or effect of this Agreement.
15. Counterparts. This Agreement may be executed in counterparts, each
of which when so executed shall together constitute but one and the same
agreement.
16. Severability. Any provision of this Agreement that is prohibited or
unenforceable in any jurisdiction shall 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.
13
<PAGE>
17. Not Applicable to ________________________ in Other Capacities.
Nothing in this Agreement shall affect any obligation ________________________
may have in any other capacity.
18. Limitation of Liability of Owner Trustee, Indenture Trustee and
Administrator. (a) Notwithstanding anything contained herein to the contrary,
this instrument has been signed by ____________________________ not in its
individual capacity but solely in its capacity as Owner Trustee of the Issuer
and in no event shall _________________________________________
in its individual capacity or any beneficial owner of the
Issuer have any liability for the representations, warranties, covenants,
agreements or other obligations of the Issuer hereunder, 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 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 signed by _______________________ ________________, not in
its individual capacity but solely as Indenture Trustee, and in no event shall
__________________________ ________________ 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.
(c) No recourse under any obligation, covenant or agreement of the
Issuer contained in this Agreement shall be had against any agent of the Issuer
(including the Administrator) as such by the enforcement of any assessment or by
any legal or equitable proceeding, by virtue of any statute or otherwise; it
being expressly agreed and understood that this Agreement is solely an
obligation of the Issuer as a Delaware business trust, and that no personal
liability whatever shall attach to or be incurred by any agent of the Issuer
(including the Administrator), as such, under or by reason of any of the
obligations, covenants or agreements of the Issuer contained in this Agreement,
or implied therefrom, and that any and all personal liability for breaches by
the Issuer of any such obligations, covenants or agreements, either at common
law or at equity, or by statute or constitution, of every such agent is hereby
expressly waived as a condition of and in consideration for the execution of
this Agreement.
19. Third-Party Beneficiary. Each of the Seller (to the extent provided
in Section 11) and the Owner Trustee is a third-party beneficiary to this
Agreement and is entitled to the rights and benefits hereunder and may enforce
the provisions hereof as if it were a party hereto.
14
<PAGE>
21. Nonpetition Covenants. Notwithstanding any prior termination of
this Agreement, the Administrator, the Issuer and the Indenture Trustee shall
not, prior to the date which is one year and one day after the termination of
this Agreement with respect to the Issuer, acquiesce, petition or otherwise
invoke or cause the Issuer to invoke the process of any court of government
authority for the purpose of commencing or sustaining a case against the Issuer
under any Federal or state bankruptcy, insolvency or similar law or appointing a
receiver, liquidator, assignee, trustee, custodian, sequestrator or other
similar official of the Issuer or any substantial part of its property, or
ordering the winding up or liquidation of the affairs of the Issuer.
22. Liability of Administrator. Notwithstanding any provision of this
Agreement, the Administrator shall not have any obligations under this Agreement
other than those specifically set forth herein, and no implied obligations of
the Administrator shall be read into this Agreement. Neither the Administrator
nor any of its directors, officers, agents or employees shall be liable for any
action taken or omitted to be taken in good faith by it or them under or in
connection with this Agreement, except for its or their own gross negligence or
willful misconduct and in no event shall the Administrator be liable under or in
connection with this Agreement for indirect, special, or consequential losses or
damages of any kind, including lost profits, even if advised of the possibility
thereof and regardless of the form of action by which such losses or damages may
be claimed. Without limiting the foregoing, the Administrator may (a) consult
with legal counsel (including counsel for the Issuer), independent public
accountants and other experts selected by it and shall not be liable for any
action taken or omitted to be taken in good faith by it in accordance with the
advice of such counsel, accountants or experts and (b) shall incur no liability
under or in respect of this Agreement by acting upon any notice (including
notice by telephone), consent, certificate or other instrument or writing (which
may be by facsimile) believed by it to be genuine and signed or sent by the
proper party or parties.
15
<PAGE>
IN WITNESS WHEREOF, the parties have caused this Agreement to be duly
executed and delivered as of the day and year first above written.
CHASE MANHATTAN AUTO OWNER TRUST
199_-__
By: ______________________________________________________,
not in its individual capacity
but solely as Owner Trustee,
By: _______________________________________________________
Name:
Title:
______________________________________,
_________________________________________________________
not in its individual
capacity but solely as Indenture
Trustee,
By: _______________________________________________________
Name:
Title:
________________________,
as Administrator,
By: _______________________________________________________
Name:
Title:
<PAGE>
EXHIBIT A
[Form of Power of Attorney]
POWER OF ATTORNEY
STATE OF NEW YORK )
)
COUNTY OF NEW YORK )
KNOW ALL MEN BY THESE PRESENTS, that _______________, a ____
________________ banking corporation, not in its individual
capacity but solely as owner trustee ("Owner Trustee") for Chase Manhattan Auto
Owner Trust 199_-_ ("Trust"), does hereby make, constitute and appoint
_____________________________, as Administrator under the Administration
Agreement (as defined below), and its agents and attorneys, as Attorneys-in-Fact
to execute on behalf of the Owner Trustee or the Trust all such documents,
reports, filings, instruments, certificates and opinions as it shall be the duty
of the Owner Trustee or the Trust to prepare, file or deliver pursuant to the
Related Documents (as defined in the Administration Agreement), including,
without limitation, to appear for and represent the Owner Trustee and the Trust
in connection with the preparation, filing and audit of federal, state and local
tax returns pertaining to the Trust, and with full power to perform any and all
acts associated with such returns and audits that the Owner Trustee could
perform, including without limitation, the right to distribute and receive
confidential information, defend and assert positions in response to audits,
initiate and defend litigation, and to execute waivers of restriction on
assessments of deficiencies, consents to the extension of any statutory or
regulatory time limit, and settlements. For the purpose of this Power of
Attorney, the term "Administration Agreement" means the Administration Agreement
dated as of _________ __, ____ among the Trust, ________________________, as
Administrator, and ________________________________, as Indenture Trustee, as
such may be amended from time to time.
All powers of attorney for this purpose heretofore filed or executed
by the Owner Trustee are hereby revoked.
EXECUTED this ____ day of _______, ____.
_____________________,
not in its individual
capacity but solely as
Owner Trustee
By: __________________
Name:
Title:
<PAGE>
[LETTERHEAD OF SIMPSON THACHER & BARTLETT]
September 30, 1997
Chase Manhattan Bank USA, National Association
802 Delaware Avenue
Wilmington, Delaware 19801
Ladies and Gentlemen:
We have acted as counsel to Chase Manhattan Bank USA, National
Association, a national banking association (the 'Registrant'), in connection
with the filing by the Registrant with the Securities and Exchange Commission
(the 'Commission') under the Securities Act of 1933, as amended (the 'Act'), of
a Registration Statement on Form S-3 (the 'Registration Statement'), registering
Asset Backed Notes (the 'Notes') and Asset Backed Certificates (the
'Certificates') to be issued by one or more trusts to be formed by the
Registrant (each, a 'Trust') either pursuant to a Trust Agreement between the
Registrant and the owner trustee designated thereunder, substantially in the
form filed as Exhibit 4.3(C) to the Registration Statement (the 'Trust
Agreement'), or a Pooling and Servicing Agreement between the Registrant, as
seller and servicer, and the trustee designated thereunder, substantially in the
form filed as Exhibit 4.1(A) to the Registration Statement (the 'Pooling and
Servicing Agreement'). The Certificates of a particular series will represent
undivided interests in the assets of the related Trust and will be issued
pursuant to the Trust Agreement or the Pooling and Servicing Agreement, as the
case may be. The Notes of a particular series will be issued and secured
pursuant to an Indenture between the related Trust and the indenture trustee
designated thereunder, substantially in the form filed as Exhibit 4.2 to the
Registration Statement (the 'Indenture'). The Notes and the Certificates are
hereinafter collectively referred to as the 'Offered Securities.'
In that connection, we have examined the forms of Trust Agreement, Pooling
and Servicing Agreement and Indenture. In addition, we have examined and relied
as to matters of fact upon, originals or copies, certified or otherwise
identified to our satisfaction, of such corporate records, agreements,
documents, and other instruments and such certificates or comparable documents
of public officials and of officers and representatives of the Registrant, and
have made such other and further investigations, as we have deemed relevant and
necessary as a basis for the opinions hereinafter set forth.
In such examination, we have assumed the genuineness of all signatures, the
legal capacity of natural persons, the authenticity of all documents submitted
to us as originals, the conformity to original documents of all documents
submitted to us as certified or photostatic copies, and the authenticity of the
originals of such latter documents. In addition, we have assumed that (i) a
prospectus supplement will have been prepared and filed with the Commission
describing the Offered Securities (each, a 'Prospectus Supplement'); (ii) all
Offered Securities issued will be issued and sold in compliance with applicable
federal and state securities laws and solely in the manner stated in the
Registration Statement and the applicable Prospectus Supplement; and (iii) a
definitive purchase, underwriting or similar agreement with respect to any
Offered Securities will have been duly authorized and validly executed and
delivered by the Registrant and the other parties thereto.
Based upon the foregoing, we are of the opinion that:
1. When a Pooling and Servicing Agreement has been duly authorized,
executed and delivered by the Registrant and the trustee designated
therein, such Pooling and Servicing Agreement will constitute a valid and
legally binding obligation of the Registrant enforceable against the
Registrant in accordance with its terms.
2. When a Trust Agreement has been duly authorized, executed and
delivered by the Registrant and the owner trustee designated therein, such
Trust Agreement will constitute a valid and legally binding obligation of
the Registrant enforceable against the Registrant in accordance with its
terms.
3. When the issuance and terms of the Certificates of a particular
series have been duly authorized by the Registrant, when such Certificates
have been duly executed and authenticated in accordance with the terms of
the related Pooling and Servicing Agreement or Trust Agreement, as the case
may be, and when such Certificates have been delivered and sold in
accordance with the provisions of the applicable definitive purchase,
underwriting or similar agreement as contemplated by the Registration
Statement, upon payment of the consideration therefor provided for therein,
such Certificates will be legally issued, fully paid and
<PAGE>
non-assessable and outstanding and entitled to the benefits provided for by
the related Pooling and Servicing Agreement or Trust Agreement, as the case
may be.
4. When the related Indenture has been duly qualified under the Trust
Indenture Act of 1939, as amended, the issuance and terms of the Notes of a
particular series have been duly authorized by the Registrant and the
applicable Trust, when such Notes have been duly executed and authenticated
in accordance with the terms of the related Indenture, and when such Notes
have been delivered and sold in accordance with the provisions of the
applicable definitive purchase, underwriting or similar agreement as
contemplated by the Registration Statement, upon payment of the
consideration therefor provided for therein, such Notes will constitute
valid and legally binding obligations of the applicable Trust, enforceable
against such Trust in accordance with their terms.
Our opinions are subject to the effects of bankruptcy, insolvency,
fraudulent conveyance, reorganization, moratorium and other similar laws
relating to or affecting creditors' rights generally, general equitable
principles (whether considered in a proceeding in equity or at law) and an
implied covenant of good faith and fair dealing.
We hereby confirm that the statements set forth in the forms of prospectus
supplements forming a part of the Registration Statement under the headings
'Certain Federal Income Tax Consequences' would accurately describe, as of the
date hereof, the material federal income tax consequences that would be
relevant to holders of the Offered Securities described in such forms of
prospectus supplement.
We are members of the Bar of the State of New York, and we do not express
any opinion herein concerning any law other than the law of the State of New
York and the Federal law of the United States.
We hereby consent to the use of our name under the headings 'Certain
Federal Income Tax Consequences' and 'Legal Matters' in the Prospectus
Supplements forming a part of the Registration Statement and to the use of this
opinion for filing with the Registration Statement as Exhibit 5.1 thereto.
Very truly yours,
/s/ Simpson Thacher & Bartlett
--------------------------------------
SIMPSON THACHER & BARTLETT
2
<PAGE>
POWER OF ATTORNEY
KNOW ALL BY THESE PRESENTS, that the person whose signature appears below,
in his or her capacity as an officer or a member of the Board of Directors of
CHASE MANHATTAN BANK USA, NATIONAL ASSOCIATION (the 'Bank') hereby constitutes
and appoints Donald L. Boudreau, Deborah L. Duncan, Michael Urkowitz, John
Hehir, Thomas Jacob, William H. Hoefling, Keith W. Schuck, Barbara Toppeta and
Andrew Semmelman, and each of them severally, with full power of substitution in
the premises, his or her true and lawful attorneys and agents to execute in his
or her name, place and stead (in any such capacity) a registration statement (a
'Registration Statement') of the Bank on Form S-3 for the registration under the
Securities Act of 1933 of one or more series of asset-backed securities
('Asset-Backed Securities') to be issued by one or more trusts to be formed by
the Bank representing fractional undivided owners interests in, or debt
obligations secured by, retail installment sales contracts, purchase money notes
or other notes secured by vehicles originated or acquired by the Bank and its
subsidiaries and affiliates, and shall have such provisions as such
attorney-in-fact shall approve, such approval to be conclusively evidenced by
the execution thereof by such attorney-in-fact, and any and all amendments
(including post-effective amendments) thereto, and all instruments necessary or
appropriate in connection therewith, and to file the same with the Securities
and Exchange Commission ('Commission'), and to appear on behalf of the Bank
before the Commission or elsewhere, in connection with any matters relating to
the registration of the Asset-Backed Securities, each of said attorneys and
agents to have power to act with or without the others, and to have full power
and authority to do and perform in the name and on behalf of each of such
officers or directors, and any of them, every act whatsoever necessary or
advisable to be done by the undersigned in connection with the issuance of any
such Asset-Backed Securities pursuant to the resolutions of the Board of
Directors of the Bank, adopted on February 26, 1997.
IN WITNESS WHEREOF, the undersigned has executed this Power of Attorney as
of April 15, 1997.
/s/ DONALD L. BOUDREAU
-------------------------------------
Name: Donald L. Boudreau
Title: Chairman of the Board and
Director
<PAGE>
POWER OF ATTORNEY
KNOW ALL BY THESE PRESENTS, that the person whose signature appears below,
in his or her capacity as an officer or a member of the Board of Directors of
CHASE MANHATTAN BANK USA, NATIONAL ASSOCIATION (the 'Bank') hereby constitutes
and appoints Donald L. Boudreau, Deborah L. Duncan, Michael Urkowitz, John
Hehir, Thomas Jacob, William H. Hoefling, Keith W. Schuck, Barbara Toppeta and
Andrew Semmelman, and each of them severally, with full power of substitution in
the premises, his or her true and lawful attorneys and agents to execute in his
or her name, place and stead (in any such capacity) a registration statement (a
'Registration Statement') of the Bank on Form S-3 for the registration under the
Securities Act of 1933 of one or more series of asset-backed securities
('Asset-Backed Securities') to be issued by one or more trusts to be formed by
the Bank representing fractional undivided owners interests in, or debt
obligations secured by, retail installment sales contracts, purchase money notes
or other notes secured by vehicles originated or acquired by the Bank and its
subsidiaries and affiliates, and shall have such provisions as such
attorney-in-fact shall approve, such approval to be conclusively evidenced by
the execution thereof by such attorney-in-fact, and any and all amendments
(including post-effective amendments) thereto, and all instruments necessary or
appropriate in connection therewith, and to file the same with the Securities
and Exchange Commission ('Commission'), and to appear on behalf of the Bank
before the Commission or elsewhere, in connection with any matters relating to
the registration of the Asset-Backed Securities, each of said attorneys and
agents to have power to act with or without the others, and to have full power
and authority to do and perform in the name and on behalf of each of such
officers or directors, and any of them, every act whatsoever necessary or
advisable to be done by the undersigned in connection with the issuance of any
such Asset-Backed Securities pursuant to the resolutions of the Board of
Directors of the Bank, adopted on February 26, 1997.
IN WITNESS WHEREOF, the undersigned has executed this Power of Attorney as
of May 5, 1997.
/s/ MICHAEL BARRETT
-------------------------------------
Name: Michael Barrett
Title: President and Director
<PAGE>
POWER OF ATTORNEY
KNOW ALL BY THESE PRESENTS, that the person whose signature appears below,
in his or her capacity as an officer or a member of the Board of Directors of
CHASE MANHATTAN BANK USA, NATIONAL ASSOCIATION (the 'Bank') hereby constitutes
and appoints Donald L. Boudreau, Deborah L. Duncan, Michael Urkowitz, John
Hehir, Thomas Jacob, William H. Hoefling, Keith W. Schuck, Barbara Toppeta and
Andrew Semmelman, and each of them severally, with full power of substitution in
the premises, his or her true and lawful attorneys and agents to execute in his
or her name, place and stead (in any such capacity) a registration statement (a
'Registration Statement') of the Bank on Form S-3 for the registration under the
Securities Act of 1933 of one or more series of asset-backed securities
('Asset-Backed Securities') to be issued by one or more trusts to be formed by
the Bank representing fractional undivided owners interests in, or debt
obligations secured by, retail installment sales contracts, purchase money notes
or other notes secured by vehicles originated or acquired by the Bank and its
subsidiaries and affiliates, and shall have such provisions as such
attorney-in-fact shall approve, such approval to be conclusively evidenced by
the execution thereof by such attorney-in-fact, and any and all amendments
(including post-effective amendments) thereto, and all instruments necessary or
appropriate in connection therewith, and to file the same with the Securities
and Exchange Commission ('Commission'), and to appear on behalf of the Bank
before the Commission or elsewhere, in connection with any matters relating to
the registration of the Asset-Backed Securities, each of said attorneys and
agents to have power to act with or without the others, and to have full power
and authority to do and perform in the name and on behalf of each of such
officers or directors, and any of them, every act whatsoever necessary or
advisable to be done by the undersigned in connection with the issuance of any
such Asset-Backed Securities pursuant to the resolutions of the Board of
Directors of the Bank, adopted on February 26, 1997.
IN WITNESS WHEREOF, the undersigned has executed this Power of Attorney as
of May 5, 1997.
/s/ LUKE S. HAYDEN
-------------------------------------
Name: Luke S. Hayden
Title: Director
<PAGE>
POWER OF ATTORNEY
KNOW ALL BY THESE PRESENTS, that the person whose signature appears below,
in his or her capacity as an officer or a member of the Board of Directors of
CHASE MANHATTAN BANK USA, NATIONAL ASSOCIATION (the 'Bank') hereby constitutes
and appoints Donald L. Boudreau, Deborah L. Duncan, Michael Urkowitz, John
Hehir, Thomas Jacob, William H. Hoefling, Keith W. Schuck, Barbara Toppeta and
Andrew Semmelman, and each of them severally, with full power of substitution in
the premises, his or her true and lawful attorneys and agents to execute in his
or her name, place and stead (in any such capacity) a registration statement (a
'Registration Statement') of the Bank on Form S-3 for the registration under the
Securities Act of 1933 of one or more series of asset-backed securities
('Asset-Backed Securities') to be issued by one or more trusts to be formed by
the Bank representing fractional undivided owners interests in, or debt
obligations secured by, retail installment sales contracts, purchase money notes
or other notes secured by vehicles originated or acquired by the Bank and its
subsidiaries and affiliates, and shall have such provisions as such
attorney-in-fact shall approve, such approval to be conclusively evidenced by
the execution thereof by such attorney-in-fact, and any and all amendments
(including post-effective amendments) thereto, and all instruments necessary or
appropriate in connection therewith, and to file the same with the Securities
and Exchange Commission ('Commission'), and to appear on behalf of the Bank
before the Commission or elsewhere, in connection with any matters relating to
the registration of the Asset-Backed Securities, each of said attorneys and
agents to have power to act with or without the others, and to have full power
and authority to do and perform in the name and on behalf of each of such
officers or directors, and any of them, every act whatsoever necessary or
advisable to be done by the undersigned in connection with the issuance of any
such Asset-Backed Securities pursuant to the resolutions of the Board of
Directors of the Bank, adopted on February 26, 1997.
IN WITNESS WHEREOF, the undersigned has executed this Power of Attorney as
of April 15, 1997.
/s/ JOHN J. HEHIR, JR.
-------------------------------------
Name: John J. Hehir, Jr.
Title: Director
<PAGE>
POWER OF ATTORNEY
KNOW ALL BY THESE PRESENTS, that the person whose signature appears below,
in his or her capacity as an officer or a member of the Board of Directors of
CHASE MANHATTAN BANK USA, NATIONAL ASSOCIATION (the 'Bank') hereby constitutes
and appoints Donald L. Boudreau, Deborah L. Duncan, Michael Urkowitz, John
Hehir, Thomas Jacob, William H. Hoefling, Keith W. Schuck, Barbara Toppeta and
Andrew Semmelman, and each of them severally, with full power of substitution in
the premises, his or her true and lawful attorneys and agents to execute in his
or her name, place and stead (in any such capacity) a registration statement (a
'Registration Statement') of the Bank on Form S-3 for the registration under the
Securities Act of 1933 of one or more series of asset-backed securities
('Asset-Backed Securities') to be issued by one or more trusts to be formed by
the Bank representing fractional undivided owners interests in, or debt
obligations secured by, retail installment sales contracts, purchase money notes
or other notes secured by vehicles originated or acquired by the Bank and its
subsidiaries and affiliates, and shall have such provisions as such
attorney-in-fact shall approve, such approval to be conclusively evidenced by
the execution thereof by such attorney-in-fact, and any and all amendments
(including post-effective amendments) thereto, and all instruments necessary or
appropriate in connection therewith, and to file the same with the Securities
and Exchange Commission ('Commission'), and to appear on behalf of the Bank
before the Commission or elsewhere, in connection with any matters relating to
the registration of the Asset-Backed Securities, each of said attorneys and
agents to have power to act with or without the others, and to have full power
and authority to do and perform in the name and on behalf of each of such
officers or directors, and any of them, every act whatsoever necessary or
advisable to be done by the undersigned in connection with the issuance of any
such Asset-Backed Securities pursuant to the resolutions of the Board of
Directors of the Bank, adopted on February 26, 1997.
IN WITNESS WHEREOF, the undersigned has executed this Power of Attorney as
of April 15, 1997.
/s/ WILLIAM H. HOEFLING
-------------------------------------
Name: William H. Hoefling
Title: Director
<PAGE>
POWER OF ATTORNEY
KNOW ALL BY THESE PRESENTS, that the person whose signature appears below,
in his or her capacity as an officer or a member of the Board of Directors of
CHASE MANHATTAN BANK USA, NATIONAL ASSOCIATION (the 'Bank') hereby constitutes
and appoints Donald L. Boudreau, Deborah L. Duncan, Michael Urkowitz, John
Hehir, Thomas Jacob, William H. Hoefling, Keith W. Schuck, Barbara Toppeta and
Andrew Semmelman, and each of them severally, with full power of substitution in
the premises, his or her true and lawful attorneys and agents to execute in his
or her name, place and stead (in any such capacity) a registration statement (a
'Registration Statement') of the Bank on Form S-3 for the registration under the
Securities Act of 1933 of one or more series of asset-backed securities
('Asset-Backed Securities') to be issued by one or more trusts to be formed by
the Bank representing fractional undivided owners interests in, or debt
obligations secured by, retail installment sales contracts, purchase money notes
or other notes secured by vehicles originated or acquired by the Bank and its
subsidiaries and affiliates, and shall have such provisions as such
attorney-in-fact shall approve, such approval to be conclusively evidenced by
the execution thereof by such attorney-in-fact, and any and all amendments
(including post-effective amendments) thereto, and all instruments necessary or
appropriate in connection therewith, and to file the same with the Securities
and Exchange Commission ('Commission'), and to appear on behalf of the Bank
before the Commission or elsewhere, in connection with any matters relating to
the registration of the Asset-Backed Securities, each of said attorneys and
agents to have power to act with or without the others, and to have full power
and authority to do and perform in the name and on behalf of each of such
officers or directors, and any of them, every act whatsoever necessary or
advisable to be done by the undersigned in connection with the issuance of any
such Asset-Backed Securities pursuant to the resolutions of the Board of
Directors of the Bank, adopted on February 26, 1997.
IN WITNESS WHEREOF, the undersigned has executed this Power of Attorney as
of May 5, 1997.
/s/ KEVIN T. HURLEY
-------------------------------------
Name: Kevin T. Hurley
Title: Director
<PAGE>
POWER OF ATTORNEY
KNOW ALL BY THESE PRESENTS, that the person whose signature appears below,
in his or her capacity as an officer or a member of the Board of Directors of
CHASE MANHATTAN BANK USA, NATIONAL ASSOCIATION (the 'Bank') hereby constitutes
and appoints Donald L. Boudreau, Deborah L. Duncan, Michael Urkowitz, John
Hehir, Thomas Jacob, William H. Hoefling, Keith W. Schuck, Barbara Toppeta and
Andrew Semmelman, and each of them severally, with full power of substitution in
the premises, his or her true and lawful attorneys and agents to execute in his
or her name, place and stead (in any such capacity) a registration statement (a
'Registration Statement') of the Bank on Form S-3 for the registration under the
Securities Act of 1933 of one or more series of asset-backed securities
('Asset-Backed Securities') to be issued by one or more trusts to be formed by
the Bank representing fractional undivided owners interests in, or debt
obligations secured by, retail installment sales contracts, purchase money notes
or other notes secured by vehicles originated or acquired by the Bank and its
subsidiaries and affiliates, and shall have such provisions as such
attorney-in-fact shall approve, such approval to be conclusively evidenced by
the execution thereof by such attorney-in-fact, and any and all amendments
(including post-effective amendments) thereto, and all instruments necessary or
appropriate in connection therewith, and to file the same with the Securities
and Exchange Commission ('Commission'), and to appear on behalf of the Bank
before the Commission or elsewhere, in connection with any matters relating to
the registration of the Asset-Backed Securities, each of said attorneys and
agents to have power to act with or without the others, and to have full power
and authority to do and perform in the name and on behalf of each of such
officers or directors, and any of them, every act whatsoever necessary or
advisable to be done by the undersigned in connection with the issuance of any
such Asset-Backed Securities pursuant to the resolutions of the Board of
Directors of the Bank, adopted on February 26, 1997.
IN WITNESS WHEREOF, the undersigned has executed this Power of Attorney as
of April 15, 1997.
/s/ THOMAS JACOB
-------------------------------------
Name: Thomas Jacob
Title: Director
<PAGE>
POWER OF ATTORNEY
KNOW ALL BY THESE PRESENTS, that the person whose signature appears below,
in his or her capacity as an officer or a member of the Board of Directors of
CHASE MANHATTAN BANK USA, NATIONAL ASSOCIATION (the 'Bank') hereby constitutes
and appoints Donald L. Boudreau, Deborah L. Duncan, Michael Urkowitz, John
Hehir, Thomas Jacob, William H. Hoefling, Keith W. Schuck, Barbara Toppeta and
Andrew Semmelman, and each of them severally, with full power of substitution in
the premises, his or her true and lawful attorneys and agents to execute in his
or her name, place and stead (in any such capacity) a registration statement (a
'Registration Statement') of the Bank on Form S-3 for the registration under the
Securities Act of 1933 of one or more series of asset-backed securities
('Asset-Backed Securities') to be issued by one or more trusts to be formed by
the Bank representing fractional undivided owners interests in, or debt
obligations secured by, retail installment sales contracts, purchase money notes
or other notes secured by vehicles originated or acquired by the Bank and its
subsidiaries and affiliates, and shall have such provisions as such
attorney-in-fact shall approve, such approval to be conclusively evidenced by
the execution thereof by such attorney-in-fact, and any and all amendments
(including post-effective amendments) thereto, and all instruments necessary or
appropriate in connection therewith, and to file the same with the Securities
and Exchange Commission ('Commission'), and to appear on behalf of the Bank
before the Commission or elsewhere, in connection with any matters relating to
the registration of the Asset-Backed Securities, each of said attorneys and
agents to have power to act with or without the others, and to have full power
and authority to do and perform in the name and on behalf of each of such
officers or directors, and any of them, every act whatsoever necessary or
advisable to be done by the undersigned in connection with the issuance of any
such Asset-Backed Securities pursuant to the resolutions of the Board of
Directors of the Bank, adopted on February 26, 1997.
IN WITNESS WHEREOF, the undersigned has executed this Power of Attorney as
of May 5, 1997.
/s/ JOHN M. NUZUM, JR.
-------------------------------------
Name: John M. Nuzum, Jr.
Title: Director
<PAGE>
POWER OF ATTORNEY
KNOW ALL BY THESE PRESENTS, that the person whose signature appears below,
in his or her capacity as an officer or a member of the Board of Directors of
CHASE MANHATTAN BANK USA, NATIONAL ASSOCIATION (the 'Bank') hereby constitutes
and appoints Donald L. Boudreau, Deborah L. Duncan, Michael Urkowitz, John
Hehir, Thomas Jacob, William H. Hoefling, Keith W. Schuck, Barbara Toppeta and
Andrew Semmelman, and each of them severally, with full power of substitution in
the premises, his or her true and lawful attorneys and agents to execute in his
or her name, place and stead (in any such capacity) a registration statement (a
'Registration Statement') of the Bank on Form S-3 for the registration under the
Securities Act of 1933 of one or more series of asset-backed securities
('Asset-Backed Securities') to be issued by one or more trusts to be formed by
the Bank representing fractional undivided owners interests in, or debt
obligations secured by, retail installment sales contracts, purchase money notes
or other notes secured by vehicles originated or acquired by the Bank and its
subsidiaries and affiliates, and shall have such provisions as such
attorney-in-fact shall approve, such approval to be conclusively evidenced by
the execution thereof by such attorney-in-fact, and any and all amendments
(including post-effective amendments) thereto, and all instruments necessary or
appropriate in connection therewith, and to file the same with the Securities
and Exchange Commission ('Commission'), and to appear on behalf of the Bank
before the Commission or elsewhere, in connection with any matters relating to
the registration of the Asset-Backed Securities, each of said attorneys and
agents to have power to act with or without the others, and to have full power
and authority to do and perform in the name and on behalf of each of such
officers or directors, and any of them, every act whatsoever necessary or
advisable to be done by the undersigned in connection with the issuance of any
such Asset-Backed Securities pursuant to the resolutions of the Board of
Directors of the Bank, adopted on February 26, 1997.
IN WITNESS WHEREOF, the undersigned has executed this Power of Attorney as
of April 15, 1997.
/s/ KEITH W. SCHUCK
-------------------------------------
Name: Keith W. Schuck
Title: Chief Financial Officer
Controller (Principal Accounting
Officer)
<PAGE>
POWER OF ATTORNEY
KNOW ALL BY THESE PRESENTS, that the person whose signature appears below,
in his or her capacity as an officer or a member of the Board of Directors of
CHASE MANHATTAN BANK USA, NATIONAL ASSOCIATION (the 'Bank') hereby constitutes
and appoints Donald L. Boudreau, Deborah L. Duncan, Michael Urkowitz, John
Hehir, Thomas Jacob, William H. Hoefling, Keith W. Schuck, Barbara Toppeta and
Andrew Semmelman, and each of them severally, with full power of substitution in
the premises, his or her true and lawful attorneys and agents to execute in his
or her name, place and stead (in any such capacity) a registration statement (a
'Registration Statement') of the Bank on Form S-3 for the registration under the
Securities Act of 1933 of one or more series of asset-backed securities
('Asset-Backed Securities') to be issued by one or more trusts to be formed by
the Bank representing fractional undivided owners interests in, or debt
obligations secured by, retail installment sales contracts, purchase money notes
or other notes secured by vehicles originated or acquired by the Bank and its
subsidiaries and affiliates, and shall have such provisions as such
attorney-in-fact shall approve, such approval to be conclusively evidenced by
the execution thereof by such attorney-in-fact, and any and all amendments
(including post-effective amendments) thereto, and all instruments necessary or
appropriate in connection therewith, and to file the same with the Securities
and Exchange Commission ('Commission'), and to appear on behalf of the Bank
before the Commission or elsewhere, in connection with any matters relating to
the registration of the Asset-Backed Securities, each of said attorneys and
agents to have power to act with or without the others, and to have full power
and authority to do and perform in the name and on behalf of each of such
officers or directors, and any of them, every act whatsoever necessary or
advisable to be done by the undersigned in connection with the issuance of any
such Asset-Backed Securities pursuant to the resolutions of the Board of
Directors of the Bank, adopted on February 26, 1997.
IN WITNESS WHEREOF, the undersigned has executed this Power of Attorney as
of April 15, 1997.
/s/ MICHAEL URKOWITZ
-------------------------------------
Name: Michael Urkowitz
Title: Director
