<PAGE>
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): June 11, 1998
CHASE MANHATTAN BANK USA, NATIONAL ASSOCIATION
(Exact Name of registrant specified in its charter)
<TABLE>
<S> <C> <C>
United States 333-36939 22-2382028
(State or other Jurisdiction of (Commission File Number) (I.R.S. employer
Incorporation) Identification No.)
</TABLE>
802 Delaware Avenue
Wilmington, Delaware 19801
(Address of principal executive offices)
Registrant's telephone number: (302) 575-5033
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2
Item 5. Other Events
On June 11, 1998, the Note Underwriting Agreement, between
Chase Manhattan Bank USA, National Association, as Seller and Servicer, and
Chase Securities Inc., as Representative of the several Underwriters parties
thereto, was executed and entered into by the parties thereto.
On June 11, 1998, the Certificate Underwriting Agreement,
between Chase Manhattan Bank USA, National Association, as Seller and
Servicer, and Chase Securities Inc., as Underwriter, was executed and entered
into by the parties thereto.
On June 17, 1998, the Sale and Servicing Agreement, dated as
of June 1, 1998, between Chase Manhattan Auto Owner Trust 1998-C, as Issuer
and Chase Manhattan Bank USA, National Association, as Seller and Servicer,
was executed and entered into by the parties thereto.
On June 17, 1998, the Indenture, dated as of June 1, 1998,
between Chase Manhattan Auto Owner Trust 1998-C, as Issuer, and Norwest Bank
Minnesota, National Association, as Indenture Trustee, was executed and
entered into by the parties thereto.
On June 17, 1998, the amended and restated Trust Agreement,
dated as of June 1, 1998, between Chase Manhattan Bank USA, National
Association, as Depositor, and Wilmington Trust Company, as Owner Trustee, was
executed and entered into by the parties thereto.
On June 17, 1998, the Administration Agreement, dated as of
June 1, 1998, between Chase Manhattan Auto Owner Trust 1998-C, as Issuer,
Norwest Bank Minnesota, National Association, as Indenture Trustee, and The
Chase Manhattan Bank, as Administrator, was executed and entered into by the
parties thereto.
Item 7. Financial Statements, Pro Forma Financial Statements and Exhibits
Exhibits
1.1(B)(3) Note Underwriting Agreement, dated June 11, 1998.
1.1(B)(3) Certificate Underwriting Agreement, dated June 11, 1998.
4.1(B)(3) Sale and Servicing Agreement, dated June 1, 1998.
4.2(3) Indenture, dated June 1, 1998.
4.3(C)(3) Amended and Restated Trust Agreement, dated June 1, 1998.
4.4(3) Administration Agreement, dated June 1, 1998.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
CHASE MANHATTAN BANK USA,
NATIONAL ASSOCIATION (Registrant)
By: /s/ Keith Schuck
Name: Keith Schuck
Title: Controller
Date: June 11, 1998
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4
INDEX TO EXHIBITS
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<CAPTION>
Exhibit Number Exhibit Sequentially
- -------------- ------- Numbered Pages
--------------
<S> <C>
1.1(B)(3) Note Underwriting Agreement, dated June 11, 1998.
1.1(B)(3) Certificate Underwriting Agreement, dated June 11, 1998.
4.1(B)(3) Sale and Servicing Agreement, dated June 1, 1998.
4.2(3) Indenture, dated June 1, 1998.
4.3(C)(3) Amended and Restated Trust Agreement, dated June 1, 1998.
4.4(3) Administration Agreement, dated June 1, 1998.
</TABLE>
<PAGE>
EXECUTION COPY
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CHASE MANHATTAN AUTO OWNER TRUST 1998-C
ASSET BACKED NOTES
CHASE MANHATTAN BANK USA, NATIONAL ASSOCIATION
Seller and Servicer
NOTE UNDERWRITING AGREEMENT
June 11, 1998
Chase Securities Inc.
As Representative of the
Several Underwriters,
270 Park Avenue
New York, NY 10017
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 1998-C (the "Trust") to sell $258,000,000.00
aggregate principal amount of Class A-1 5.588% Asset Backed Notes (the "Class
A-1 Notes"), $195,000,000.00 aggregate principal amount of Class A-2 5.747%
Asset Backed Notes (the "Class A-2 Notes"), $325,000,000.00 aggregate
principal amount of Class A-3 5.800% Asset Backed Notes (the "Class A-3
Notes") and $283,900,000.00 aggregate principal amount of Class A-4 5.850%
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 "Notes").
The assets of the Trust will include, among other things, a
pool of simple interest and actuarial 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 May 31, 1998 (the "Cut-off Date")
was equal to $1,094,789,211.45. The Notes will be issued pursuant to the
Indenture to be dated as of June 1, 1998 (as amended and supplemented from
time to time, the "Indenture"), between the Trust and Norwest Bank Minnesota,
National Association, as indenture trustee (the "Indenture Trustee").
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2
Simultaneously with the issuance and sale of the Notes as
contemplated herein, the Trust will issue $32,889,211.45 aggregate principal
amount of 6.000% Asset Backed Certificates (the "Certificates") pursuant to
the Amended and Restated Trust Agreement to be dated as of June 1, 1998 (as
amended and supplemented from time to time, the "Trust Agreement"), between
the Bank and Wilmington Trust Company, 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 Chase Securities Inc. 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 June 1, 1998 (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. 333-36939) 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 and the Term
Sheet dated June 9, 1998 relating to the Securities (the "Term Sheet")
disseminated by the Underwriters, 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 filed the Term Sheet on Form 8-K with the Commission
pursuant to the Securities Exchange Act of 1934, as amended (the "Exchange
Act"), within two business days of its dissemination by the Underwriters. 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."
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3
(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.
(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
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4
the Trust Agreement and delivered upon the order of the Bank to Chase
Securities Inc. 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.
(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 been duly executed and delivered by the Bank.
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5
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 99.900000% 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 99.837500% 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 99.757500% 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 and (d) at a purchase price
of 99.625000% 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 plus, in each case, accrued interest at the applicable Interest Rate
from June 17, 1998 to but excluding the Closing Date.
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 Simpson Thacher & Bartlett in New York, New York at 10:00 a.m., New
York City time, on June 17, 1998 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.
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 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
<PAGE>
6
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.
(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 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
<PAGE>
7
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 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 Price Waterhouse LLP, (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. Representation of the Underwriters. Each Underwriter
hereby represents and warrants that the Term Sheet constitutes the only
"Series Term Sheet" (as such term is defined in the no-action letter addressed
to Greenwood Trust Company, Discover Card Master Trust I dated April 5, 1996)
and the only "Computational Materials," "ABS Term Sheets," "Structural Term
Sheets" or "Collateral Term Sheet" (as such terms are defined in the no-action
letters addressed to Kidder, Peabody Acceptance Corporation I, et al. dated
May 20, 1994 and to the Public Securities Association dated February 17, 1995)
disseminated by it in connection with offering of the Notes contemplated
hereunder.
8. 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:
<PAGE>
8
(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 Price Waterhouse LLP and Arthur Andersen
LLP 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-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, Richards, Layton & Finger,
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 Richards,
<PAGE>
9
Layton & Finger, special counsel to the Bank, 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 Gibson, Dunn
& Crutcher 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 to the
effect (a) 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 and (b) that, subject to the
qualifications set forth therein, the discussion set forth in the
Prospectus Supplement under the caption "Certain Federal Income Tax
Consequences" is an accurate summary of the United States federal
income tax matters described therein.
(h) The Representative shall have received an opinion of
Dorsey & Whitney LLP, 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
Richards, Layton & Finger, 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 "A-1+" by
Standard & Poor's, P-1 by Moody's and "F1+" by Fitch. The Class A-2
Notes, Class A-3 Notes and Class A-4 Notes shall have been rated
"AAA" by Standard & Poor's, Aaa by Moody's and "AAA" by Fitch. The
Certificates shall have been rated "A+" by Standard & Poor's, A2 by
Moody's and "A+" 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
<PAGE>
10
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) 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) 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.
(l) On the Closing Date, $32,889,211.45 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.
9. 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
<PAGE>
11
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 9, 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 9
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 9 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 9 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.
10. Contribution. In order to provide for just and equitable
contribution in circumstances in which the indemnity agreement provided for in
Section 9 is for any reason held to be unavailable other than in accordance
with its terms, the Bank and the Underwriters shall
<PAGE>
12
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.
11. 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 12. Nothing herein will
relieve a defaulting Underwriter from liability for its default.
12. 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 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 9 and 10 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 8(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.
<PAGE>
13
13. 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 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 11530, Attention: Financial Controller.
14. 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 9 and 10 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.
15. 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.
16. 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 proceedings or other
proceedings under any Federal or state bankruptcy or similar law.
17. 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 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 /s/ Patricia Garvey
-----------------------------
Title: Vice President
The foregoing Note
Underwriting Agreement
is hereby confirmed and
accepted as of the date
first written above:
CHASE SECURITIES INC.
on behalf of itself and
as Representative
of the Several Underwriters,
named in Schedule I
By /s/ Brad Dansker
------------------------
Title: Vice President
<PAGE>
SCHEDULE I
<TABLE>
<CAPTION>
Principal Amount of Principal Amount of Principal Amount of Principal Amount of
Underwriter Class A-1 Notes Class A-2 Notes Class A-3 Notes Class A-4 Notes
----------- --------------- --------------- --------------- ---------------
<S> <C> <C> <C> <C>
Chase Securities Inc................... $64,500,000.00 $48,750,000.00 $81,250,000.00 $71,650,000.00
Credit Suisse First Boston Corporation 64,500,000.00 48,750,000.00 81,250,000.00 70,750,000.00
Goldman, Sachs & Co.................... 64,500,000.00 48,750,000.00 81,250,000.00 70,750,000.00
Merrill Lynch, Pierce, Fenner & Smith
Incorporated...................... 64,500,000.00 48,750,000.00 81,250,000.00 70,750,000.00
-------- -------- -------- --------
Total $258,000,000.00 $195,000,000.00 $325,000,000.00 $283,900,000.00
</TABLE>
<PAGE>
EXECUTION COPY
--------------
CHASE MANHATTAN AUTO OWNER TRUST 1998-C
ASSET BACKED CERTIFICATES
CHASE MANHATTAN BANK USA, NATIONAL ASSOCIATION
Seller and Servicer
CERTIFICATE UNDERWRITING AGREEMENT
June 11, 1998
Chase Securities Inc.
270 Park Avenue
New York, NY 10017
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 1998-C (the "Trust") to sell $32,889,211.45
aggregate principal amount of 6.000% 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 and actuarial 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 May 31, 1998 (the "Cut-off Date")
was equal to $1,094,789,211.45. The Certificates will be issued pursuant to
the Amended and Restated Trust Agreement to be dated as of June 1, 1998 (as
amended and supplemented from time to time, the "Trust Agreement"), between
the Bank and Wilmington Trust Company, as owner trustee (the "Owner Trustee").
Simultaneously with the issuance and sale of the
Certificates as contemplated herein, the Trust will issue $258,000,000.00
aggregate principal amount of Class A-1 5.588% Asset Backed Notes (the "Class
A-1 Notes"), $195,000,000.00 aggregate principal amount of Class A-2 5.747%
Asset Backed Notes (the "Class A-2 Notes"), $325,000,000.00 aggregate
principal amount of Class A-3 5.800% Asset Backed Notes (the "Class A-3
Notes") and $283,900,000.00 aggregate principal amount of Class A-4 5.850%
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 "Notes"), pursuant to
the Indenture to be dated as of June 1, 1998 (as amended and supplemented from
time to time, the "Indenture"), between the Trust and
<PAGE>
2
Norwest Bank Minnesota, National Association, 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 June 1, 1998 (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 Chase Securities Inc. (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. 333-36939) 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 and the Term
Sheet dated June 9, 1998 relating to the Securities (the "Term Sheet")
disseminated by the Underwriter and incorporated by reference therein, 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 filed the Term Sheet on
Form 8-K with the Commission pursuant to the Securities Exchange Act of 1934,
as amended (the "Exchange Act"), within two business days of its dissemination
by the Underwriter. 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 completed at such
<PAGE>
3
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 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.
<PAGE>
4
(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.
(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 Note Underwriting Agreement have
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 99.650000% of the face
<PAGE>
5
amount thereof, the Certificates plus accrued interest at the Certificate Rate
from June 17, 1998 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 Simpson Thacher & Bartlett in New
York, New York at 10:00 a.m., New York City time, on June 17, 1998 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
$211.45, 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 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 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
<PAGE>
6
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 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, 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.
<PAGE>
7
(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 Price Waterhouse LLP, (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. Representation of the Underwriter. The Underwriter hereby
represents and warrants that the Term Sheet constitutes the only "Series Term
Sheet" (as such term is defined in the no-action letter addressed to Greenwood
Trust Company, Discover Card Master Trust I dated April 5, 1996) and the only
"Computational Materials," "ABS Term Sheets," "Structural Term Sheets" or
"Collateral Term Sheet" (as such terms are defined in the no-action letters
addressed to Kidder, Peabody Acceptance Corporation I, et al. dated May 20,
1994 and to the Public Securities Association dated February 17, 1995)
disseminated by it in connection with offering of the Certificates
contemplated hereunder.
8. Conditions to the Obligations of the Underwriter. The
obligation of the Underwriter 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:
(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 Price Waterhouse LLP and Arthur Andersen
LLP 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.
<PAGE>
8
(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
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 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, when taken together, in
form and substance to the Underwriter, of Simpson Thacher & Bartlett,
special counsel to the Bank, Richards, Layton & Finger, 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 Richards, Layton & Finger,
special counsel to the Bank, 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 Gibson, Dunn &
Crutcher 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.
<PAGE>
9
(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 to the
effect (a) 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 and (b) that, subject to the
qualifications set forth therein, the discussion set forth in the
Prospectus Supplement under the caption "Certain Federal Income Tax
Consequences" is an accurate summary of the United States federal
income tax matters described therein.
(h) The Underwriter shall have received an opinion of Dorsey
& Whitney LLP, 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
Richards, Layton & Finger, special 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 such matters as are
customary for the type of transaction contemplated by this Agreement.
(j) The Certificates have been rated "A+" by Standard &
Poor's, A2 by Moody's and "A+" 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) 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) 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) 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.
<PAGE>
10
(l) On the Closing Date, all of the Notes shall have been
issued and sold pursuant to the Note Underwriting Agreement.
(m) The Class A-1 Notes shall have been rated "A-1+" by
Standard & Poor's, P-1 by Moody's and "F1+" by Fitch, and the Class
A-2 Notes, Class A-3 Notes and Class A-4 Notes shall have been rated
"AAA" by Standard & Poor's, Aaa by Moody's and "AAA" 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.
9. 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, 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 9, 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
<PAGE>
11
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 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 9
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 9 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 9 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.
10. Contribution. In order to provide for just and equitable
contribution in circumstances in which the indemnity agreement provided for in
Section 9 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
<PAGE>
12
controls the Bank within the meaning of Section 15 of the Act shall have the
same rights to contribution as the Bank.
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 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 9 and 10 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 8(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.
12. 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.
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 9 and 10 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.
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. 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, it will not institute against,
or join any other person in instituting against,
<PAGE>
13
the Trust any bankruptcy, reorganization, arrangement, insolvency or
liquidation 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.
<PAGE>
14
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 /s/ Patricia Garvey
-------------------------
Title: Vice President
The foregoing Underwriting
Agreement is hereby
confirmed and accepted as of
the date first written above:
CHASE SECURITIES INC.
By /s/ Brad Dansker
-------------------------
Title: Vice President
<PAGE>
EXECUTION COPY
--------------
CHASE MANHATTAN BANK USA, NATIONAL ASSOCIATION,
a National Banking Association,
as Seller and Servicer
and
CHASE MANHATTAN AUTO OWNER TRUST 1998-C
as Issuer
-----------------
SALE AND SERVICING AGREEMENT
Dated as of June 1, 1998
-----------------
<PAGE>
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TABLE OF CONTENTS
ARTICLE I
DEFINITIONS
SECTION 1.1 Definitions.................................................... 1
SECTION 1.2 Usage of Terms................................................. 24
SECTION 1.3 Simple Interest and Actuarial Method; Methods of
Allocating Payments or Receivables; Allocations................ 24
SECTION 1.4 Calculations Relating to the July 1999 Distribution Date........ 25
ARTICLE II
CONVEYANCE OF RECEIVABLES
SECTION 2.1 Conveyance of Receivables...................................... 25
SECTION 2.2 Closing........................................................ 26
ARTICLE III
THE RECEIVABLES
SECTION 3.1 Representations and Warranties of Seller; Conditions
Relating to Receivables........................................ 26
SECTION 3.2 Repurchase Upon Breach or Failure of a Condition............... 30
SECTION 3.3 Custody of Receivable Files.................................... 31
SECTION 3.4 Duties of Servicer as Custodian................................ 31
SECTION 3.5 Instructions; Authority to Act................................. 32
SECTION 3.6 Custodian's Indemnification.................................... 33
SECTION 3.7 Effective Period and Termination............................... 33
ARTICLE IV
ADMINISTRATION AND SERVICING OF RECEIVABLES
SECTION 4.1 Duties of Servicer............................................. 33
SECTION 4.2 Collection of Receivable Payments; Refinancing................. 34
SECTION 4.3 Realization Upon Receivables................................... 35
SECTION 4.4 Maintenance of Security Interests in Financed Vehicles......... 35
SECTION 4.5 Covenants of Servicer.......................................... 35
SECTION 4.6 Purchase of Receivables Upon Breach............................ 36
SECTION 4.7 Servicing Fee.................................................. 36
i
<PAGE>
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SECTION 4.8 Servicer's Certificate......................................... 37
SECTION 4.9 Annual Statement as to Compliance.............................. 37
SECTION 4.10 Annual Audit Report............................................ 38
SECTION 4.11 Access by Holders to Certain Documentation and
Information Regarding Receivables.............................. 38
SECTION 4.12 Reports to Holders and the Rating Agencies..................... 39
SECTION 4.13 Reports to the Securities and Exchange Commission.............. 39
ARTICLE V
ACCOUNTS; DISTRIBUTIONS;
STATEMENTS TO CERTIFICATEHOLDERS
SECTION 5.1 Establishment of Accounts...................................... 39
SECTION 5.2 Collections.................................................... 40
SECTION 5.3 [Reserved]..................................................... 41
SECTION 5.4 Additional Deposits............................................ 41
SECTION 5.5 Distributions.................................................. 41
SECTION 5.6 Reserve Account................................................ 43
SECTION 5.7 Net Deposits................................................... 45
SECTION 5.8 Statements to Certificateholders and Noteholders............... 45
ARTICLE VI
THE SELLER
SECTION 6.1 Representations of Seller...................................... 46
SECTION 6.2 Liability of Seller; Indemnities............................... 48
SECTION 6.3 Merger or Consolidation of Seller.............................. 48
SECTION 6.4 Limitation on Liability of Seller and Others................... 48
SECTION 6.5 Seller May Own Notes and Certificates.......................... 49
ARTICLE VII
THE SERVICER
SECTION 7.1 Representations of Servicer.................................... 49
SECTION 7.2 Liability of Servicer; Indemnities............................. 50
SECTION 7.3 Merger or Consolidation of Servicer............................ 51
SECTION 7.4 Limitation on Liability of Servicer and Others................. 51
SECTION 7.5 Servicer Not To Resign......................................... 52
SECTION 7.6 Delegation of Duties........................................... 53
ii
<PAGE>
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ARTICLE VIII
EVENTS OF SERVICING TERMINATION
SECTION 8.1 Events of Servicing Termination................................ 53
SECTION 8.2 Indenture Trustee to Act; Appointment of Successor
Servicer....................................................... 55
SECTION 8.3 Notification to Noteholders and Certificateholders............. 55
SECTION 8.4 Waiver of Past Defaults........................................ 55
ARTICLE IX
TERMINATION
SECTION 9.1 Optional Purchase of All Receivables; Trust
Termination.................................................... 56
ARTICLE X
MISCELLANEOUS PROVISIONS
SECTION 10.1 Amendment..................................................... 57
SECTION 10.2 Protection of Title to Owner Trust Estate..................... 59
SECTION 10.3 GOVERNING LAW................................................. 61
SECTION 10.4 Notices....................................................... 61
SECTION 10.5 Severability of Provisions.................................... 61
SECTION 10.6 Assignment.................................................... 61
SECTION 10.7 Certificates and Notes Nonassessable and Fully Paid........... 61
SECTION 10.8 Third-Party Beneficiaries..................................... 61
SECTION 10.9 Assignment to Indenture Trustee............................... 62
SECTION 10.10 Limitation of Liability of Owner Trustee and
Indenture Trustee............................................. 62
iii
<PAGE>
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
iv
<PAGE>
1
This SALE AND SERVICING AGREEMENT, dated as of June 1, 1998,
(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 1998-C, 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 and the
Note Distribution Account.
"Actuarial Method" means the method of allocating a fixed
level payment to principal and interest, pursuant to which each monthly
installment consists of an amount of interest equal to the 1/12 of the annual
contract rate of interest on the loan multiplied by the scheduled principal
balance of the loan and an amount of principal equal to the remainder of the
monthly payment.
"Actuarial Receivable" means any Receivable providing for the
allocation of payments made thereunder to principal and interest in accordance
with the Actuarial Method.
"Adjusted Contract Value" of an Actuarial Receivable, as of
the close of business on the last day of any Collection Period, means the excess
of the Contract Value of such Actuarial Receivable at the close of business on
such date over the Carryover Scheduled Interest Payment on such Actuarial
Receivable for such Collection Period.
"Administration Agreement" means the Administration Agreement,
dated as of June 1, 1998, among the Issuer, the Administrator and the Indenture
Trustee, as the same may be amended and supplemented from time to time.
<PAGE>
2
"Administrator" means The Chase Manhattan Bank, a New York
banking corporation, as administrator, and its successors and assigns.
"Administration Fee" means $1,000, the fee payable to the
Administrator on each Distribution Date pursuant to Section 5.5(c) for services
rendered pursuant to the Administration Agreement.
"Affiliate" means, with respect to any specified Person, any
other Person controlling or controlled by or under common control with such
specified Person. For 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 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.
"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 4.10.
"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 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, the sum
of (i) with respect to each Simple Interest Receivable, that portion of
Collections on such Simple Interest Receivable received during the related
Collection Period allocated to interest, (ii) with respect to each Actuarial
Receivable, the lesser of (A) the amount of Collections received during the
related Collection Period on such Actuarial Receivable and (B) the Scheduled
Interest Payment on such Actuarial Receivable for such Collection Period and
(iii) with respect to each Receivable repurchased by the Seller or purchased by
the Servicer under an obligation that arose during the related Collection
Period, that portion of the Repurchase Amount received with respect to such
Repurchased Receivable that would have been treated as
<PAGE>
3
Available Interest if the Obligor thereof had prepaid such Receivable in full on
the date as of which such Receivable was repurchased or purchased.
"Available Principal" means, for any Distribution Date, the
sum of (i) with respect to each Simple Interest Receivable, that portion of
Collections on such Simple Interest Receivable received during the related
Collection Period allocated to the principal balance of such Simple Interest
Receivable, (ii) with respect to each Actuarial Receivable, the lesser of (A)
the excess, if any, of (x) the amount of Collections received during the related
Collection Period on such Actuarial Receivable over (y) the Scheduled Interest
Payment on such Actuarial Receivable for such Collection Period and (B) the
amount (not less than zero) equal to (x) the Adjusted Contract Value of such
Receivable as of the close of business on the last day of the Collection Period
preceding the related Collection Period less (y) the Adjusted Contract Value of
such Receivable as of the close of business on the last day of the related
Collection Period and (iii) with respect to each Receivable repurchased by the
Seller or purchased by the Servicer under an obligation that arose during the
related Collection Period, that portion of the Repurchase Amount received with
respect to such Repurchased Receivable that would have been treated as Available
Principal if the Obligor thereof had prepaid such Receivable in full on the date
as of which such Receivable was repurchased or purchased.
"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 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.
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4
"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 Minneapolis, Minnesota 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.
"Carryover Scheduled Interest Payment" on any Actuarial
Receivable means, for any Collection Period, the excess, if any, of (i) the
Scheduled Interest Payment on such Actuarial Receivable for such Collection
Period over (ii) the amount of Collections received during such Collection
Period on such Actuarial Receivable.
"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 $32,889,211.45
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.
"Certificate Depository Agreement" means the agreement among
the Issuer, the Owner 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 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 or any similar agreement with any successor Clearing Agency.
"Certificate Distribution Account" has the meaning specified
in Section 5.1 of the Trust Agreement.
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5
"Certificate Final Scheduled Distribution Date" means the
December 2004 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 6.000% per annum.
"Certificate Register" and "Certificate Registrar" means the
register maintained and the registrar appointed pursuant to Section 3.4 of the
Trust Agreement.
"Certificated Security" means a "certificated security" within
the meaning of the Relevant UCC.
"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.
"Certificateholders' Distributable Amount" means for any
Distribution Date, the sum of (x) the Certificateholders' Principal
Distributable Amount and (y) 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,
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6
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 payments of principal to the Certificateholders on or prior to
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, the Certificatholders' Percentage of the
Principal Distribution Amount.
"Certificateholders' Percentage" means, for any Distribution
Date, 100% minus the Noteholders' Percentage.
"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 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.
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7
"Chase Direct Receivable" means a Receivable originated by
Chase directly with an Obligor without the involvement of a Dealer.
"Class A-1 Event" shall have occurred if any Class A-1 Notes
are outstanding on the June 1999 Distribution Date (after giving effect to any
payments made on such date).
"Class A-1 Interest Rate" means 5.588% per annum.
"Class A-1 Notes" means the Class A-1 5.588% Asset Backed
Notes, substantially in the form of Exhibit B to the Indenture.
"Class A-2 Interest Rate" means 5.747% per annum.
"Class A-2 Notes" means the Class A-2 5.747% Asset Backed
Notes, substantially in the form of Exhibit C to the Indenture.
"Class A-3 Interest Rate" means 5.800% per annum.
"Class A-3 Notes" means the Class A-3 5.800% Asset Backed
Notes, substantially in the form of Exhibit D to the Indenture.
"Class A-4 Interest Rate" means 5.850% per annum.
"Class A-4 Notes" means the Class A-4 5.850% Asset Backed
Notes, substantially in the form of Exhibit E 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 June 17, 1998.
"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 June
1, 1998 until Chase Manhattan Auto Owner Trust 1998-C shall terminate pursuant
to Article IX of the Trust Agreement.
"Collections" means all collections in respect of Receivables.
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8
"Contract Rate" of a Receivable means the annual rate of
interest stated in such Receivable.
"Contract Value" of an Actuarial Receivable, as of the close
of business on the last day of any Collection Period means the amount (excluding
any Late Fees with respect to such Actuarial Receivable) that would have been
payable by the Obligor thereof if such Obligor were to prepay such Actuarial
Receivable in full as of such date.
"Control" means (a) with respect to a Security Entitlement,
the Indenture Trustee (i) is identified in the records of the Securities
Intermediary for such Security Entitlement as the person having such Security
Entitlement against such Security Intermediary or (ii) has obtained the
agreement, in writing, of the Securities Intermediary for such Security
Entitlement that it will comply with orders of the Indenture Trustee regarding
the transfer or redemption of such Security Entitlement without further consent
of any other person; or (b) with respect to a United States Security
Entitlement, (i) the Indenture Trustee is a participant in the book entry system
maintained by the Federal Reserve Bank that is acting as fiscal agent for the
issuer of such United States Security Entitlement and such Federal Reserve Bank
has indicated by book entry that such United States Security Entitlement has
been credited to the Indenture Trustee's securities account in such book entry
system or (ii) (A) the Indenture Trustee (x) is identified in the records of the
Securities Intermediary for such United States Securities Entitlement as the
person having such Securities Entitlement against such Securities Intermediary
or (y) has obtained the agreement, in writing, of the Securities Intermediary
for such Security Entitlement that it will comply with orders of the Indenture
Trustee regarding the transfer or redemption of such Security Entitlement
without further consent of any other person, (B) the Securities Intermediary for
such United States Securities Entitlement is a participant in the book entry
system maintained by the Federal Reserve Bank that is acting as fiscal agent for
the issuer of such United States Security Entitlement and (C) such Federal
Reserve Bank has indicated by book entry that such United States Security
Entitlement has been credited to such Securities Intermediary's securities
account in such book entry system.
"Corporate Trust Office" means the New York office of the
Indenture Trustee or the Wilmington, Delaware office of the Owner Trustee, as
applicable.
"Cutoff Date" means May 31, 1998.
"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.
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9
"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.
"Definitive Notes" means Notes issued in certificated, fully
registered form as provided in Section 2.12 of the Indenture.
"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) with respect to any Physical Property (that is not either
a United States Security Entitlement or a Security Entitlement), physical
delivery thereof to the Indenture Trustee or its nominee or custodian by an
effective endorsement, or registered in the name of, the Indenture Trustee or
its nominee or custodian endorsed in blank; and
(b) with respect to any Uncertificated Security (i) if the
issuer of such Uncertificated Security is organized under the laws of an Old
Article 8 Jurisdiction, 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, 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 Indenture Trustee or its
nominee, agent or custodian; and (ii) if the issuer of such Uncertificated
Security is organized under the laws of a jurisdiction that has adopted Revised
Article 8, (A) the issuer registers the Indenture Trustee as the registered
owner thereof or (B) the Indenture Trustee otherwise satisfies the requirements
of Revised Article 8.
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10
"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" means, 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, July 15, 1998, 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 June 1999
Collection Period means (x) July 9, 1999 with respect to the Class A-1 Notes,
and (y) July 15, 1999 with respect to the Class A-2 Notes, the Class A-3 Notes
and the Class A-4 Notes.
"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 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.
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11
"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 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.
"Financial Asset" means a "financial asset" within the meaning
of Section 8- 102(a)(9) of Revised Article 8.
"Fitch" means Fitch IBCA, Inc. 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.
"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
<PAGE>
12
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 June 1, 1998,
between the Issuer and the Indenture Trustee, as the same may be amended and
supplemented from time to time.
"Indenture Trustee" means, initially, Norwest Bank Minnesota,
National Association, 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 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
<PAGE>
13
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.
"Issuer" means Chase Manhattan Auto Owner Trust 1998-C, 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.
"July 1999 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 July 1999 Distribution Date with
respect to the Class A-1 Notes if the Class A-1 Event has occurred.
"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.
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"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.
"Note" means a Class A-1 Note, a Class A-2 Note, a Class A-3
Note or a Class A-4 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 F 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 July 1999 Distribution Date, (b) the Class A-2 Notes, the
August 2000 Distribution Date, (c) the Class A-3 Notes, the January 2002
Distribution Date, and (d) the Class A-4 Notes, the May 2003 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, 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
class of Notes, (a) for the initial Distribution Date, zero, and (b) for any
other 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,
<PAGE>
15
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
class of Notes for such Distribution Date.
"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 24 days for the July 1999 Distribution Date for the Class A-1
Notes) and (ii) on the Class A-2 Notes, the Class A-3 Notes and the Class A-4
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, the Noteholders' Percentage of the Principal
Distribution Amount.
"Noteholders' Percentage" means (i) 100% for each Distribution
Date occurring before the Distribution Date on which the Class A-1 Notes have
been paid in full, (ii) 97% (or such greater percentage as would be necessary to
pay the Class A-1 Notes in full) on such Distribution Date, (iii) 97% after such
Distribution Date until all of the Notes have been paid in full and (iv) zero
thereafter; provided, however, that (x) if the amount on deposit in the Reserve
Account on any Distribution Date would be, after giving effect to distributions
on such Distribution Date, less than 0.5% of the Original Pool Balance, the
Noteholders' Percentage will be 100% for such Distribution Date and each
Distribution Date thereafter until the Notes have been paid in full or the
amount on deposit in the Reserve Account equals or exceeds the Specified Reserve
Account Balance and (y) if the Notes have been accelerated after the occurrence
of an Event of Default, the Noteholders' Percentage will be 100% for each
Distribution Date thereafter until the Notes have been paid 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 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
<PAGE>
16
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" means the register
maintained and the registrar appointed pursuant to 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.
"Old Article 8 Jurisdiction" means any jurisdiction that has
not adopted Revised Article 8.
"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, 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 10%.
"Original Pool Balance" shall be $1,094,789,211.45.
"Outstanding" means, when used with respect to Notes, as of
any 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;
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17
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.
"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 Wilmington Trust Company, a Delaware
banking corporation, not in its individual capacity but solely as owner trustee
under the Trust Agreement, and any successor Owner Trustee thereunder.
"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 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 backed by the full faith and
credit of the United States of America;
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18
(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, "F1+" 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,
"F1+" 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, "F1+" 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 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, "F1" by Fitch (if rated by Fitch) and P-1
by Moody's; and
(x) any other obligation or security satisfying the Rating
Agency Condition.
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19
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, Norwest Bank Minnesota,
National Association, Wilmington Trust Company or an Affiliate thereof charges
and collects fees and expenses from such funds for services rendered, (ii)
Chase, Norwest Bank Minnesota, National Association, Wilmington Trust Company 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, Norwest Bank Minnesota, National Association,
Wilmington Trust Company 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, Norwest
Bank Minnesota, National Association or Wilmington Trust Company 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" means banker's acceptances, commercial
paper, negotiable certificates of deposits and other obligations that constitute
"instruments" within the meaning of Section 9-105(l)(i) of the Relevant UCC and
are susceptible to physical delivery and Certificated Securities.
"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 the close of
business on the last day of any Collection Period, means (i) with respect to a
Simple Interest Receivable, the Amount Financed minus that portion of all
payments received on or prior to such date allocable to principal and (ii) with
respect to an Actuarial Receivable, the Adjusted Contract Value thereof as of
the close of business on such date. The Principal Balance of a Defaulted
Receivable or a Repurchased Receivable shall be deemed to be zero, in each case,
as of such date.
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20
"Principal Distribution Amount" means, for any Distribution
Date, the sum of the following amounts, without duplication: (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 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 and all monies received thereunder after the Cutoff Date.
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21
"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-4 Notes pursuant to Section 10.1 of the Indenture, an amount equal to
the Outstanding Amount of the Class A-4 Notes plus accrued and unpaid interest
thereon to but excluding the Redemption Date.
"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 "F1+" (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
$16,421,838.17.
"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, Securities Entitlements, Uncertificated Securities
or otherwise).
"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.
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22
"Responsible Officer" means, with respect to the Indenture
Trustee, any officer within the Corporate Trust Office of the Indenture Trustee,
including any Vice President, Assistant Vice President, Assistant Treasurer,
Assistant Secretary, or any other officer of the Indenture Trustee customarily
performing functions similar to those performed by any of the above designated
officers and also, with respect to a particular matter, any other officer to
whom such matter is referred because of such officer's knowledge of and
familiarity with the particular subject.
"Revised Article 8" means Revised Article 8 (1994 Version)
(and corresponding amendments to Article 9) as promulgated by the National
Conference of Commissioners on Uniform State Laws.
"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 Interest Payment" on any Actuarial Receivable
means, for any Collection Period, the sum (i) the Carryover Scheduled Interest
Payment, if any, on such Actuarial Receivable for the immediately preceding
Collection Period and (ii) that portion of the payment scheduled to be made by
the Obligor during the Collection Period immediately following such Collection
Period on such Actuarial Receivable that is allocable to interest using the
Actuarial Method.
"Securities Act" means the Securities Act of 1933, as amended.
"Securities Intermediary" means a "securities intermediary"
within the meaning of Section 8-102(a)(14) of Revised Article 8.
"Security Entitlement" means a "security entitlement" within
the meaning of Section 8-102(a)(17) of Revised Article 8.
"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, and each successor
servicer pursuant to Section 8.2.
"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
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23
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 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.
"Simple Interest Receivable" means any Receivable providing
for the allocation of payments made thereunder to principal and interest in
accordance with the Simple Interest Method.
"Specified Reserve Account Balance" with respect to any
Distribution Date, means 3.00% of the Pool Balance as of the related Settlement
Date, but in any event will not be less than the lesser of (i) $8,210,919.09 and
(ii) such Pool Balance; provided that the Specified Reserve Account Balance will
be calculated using a percentage of 6.00% for any Distribution Date (beginning
with the September 1998 Distribution Date) for which the Average Net Loss Ratio
exceeds 1.75% or the Average Delinquency Percentage exceeds 1.75%. 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.
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24
"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 Note Distribution Account and the Reserve Account.
"Trust Agreement" means the Trust Agreement dated as of June
1, 1998, 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.
"Uncertificated Security" means an "uncertificated security"
within the meaning of the relevant UCC.
"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.
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. All allocations of payments to principal and
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25
interest on the Actuarial Receivables shall be based on the Actuarial Method set
forth in the related Receivable.
Each payment on a Receivable shall be applied first, to the payment of
accrued and unpaid interest on such Receivable, second, to reduce the scheduled
principal amount outstanding on the Receivable to the extent of the remaining
scheduled payment, third, to any outstanding fees and Late Fees under the terms
of the Receivable and fourth, to reduce the principal amount outstanding on the
Receivable. Amounts paid by the Seller or the Servicer in respect of Repurchased
Receivables shall be allocated as if the Obligor thereof had prepaid such
Receivable in full on the date as of which such Receivable was repurchased by
the Seller pursuant to Section 3.2 or purchased by the Servicer pursuant to
Section 4.6 or 9.1.
SECTION 1.4 Calculations Relating to the July 1999
Distribution Date. If the Class A-1 Event has occurred, the calculations
hereunder for the July 1999 Distribution Dates with respect to the Total
Distribution Amount, the 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 July 1999 Distribution Date.
Amounts hereunder will be distributed on the respective July 1999 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, which is
incorporated by reference herein, all proceeds thereof and all amounts
and monies received thereon 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;
(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.
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26
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 (a) 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 (b) 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 Simpson Thacher & Bartlett, 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.
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.
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(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 (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 nine months nor greater than
seventy-two months, and (A) in the case of each Receivable secured by
new Financed Vehicles, had an original maturity of at least twelve
months and not more than seventy-nine months, or (B) in the case of
each Receivable secured by used Financed Vehicles, had an original
maturity of at least twelve months and not more than seventy-two
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 7.00% and not more than 18.00%;
(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;
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(viii) Remaining Principal Balance. Each Receivable
had a remaining Principal Balance of at least $2,000 and not greater
than $100,000;
(ix) 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;
(x) Receivable Files. The Receivable Files shall be
kept at one or more of the locations specified in Schedule B hereto;
(xi) 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
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 or the Actuarial Method, as applicable;
(xii) 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;
(xiii) 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,
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29
to applicable bankruptcy, insolvency, reorganization, liquidation and
other similar laws and equitable principles relating to or affecting
the enforcement of creditors' rights;
(xiv) 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;
(xv) 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);
(xvi) 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;
(xvii) 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);
(xviii) 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);
(xix) 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 being asserted or threatened,
with respect to any Receivable;
(xx) 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;
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(xxi) 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;
(xxii) Insurance. Each Receivable requires that the
Obligor thereunder maintain comprehensive, liability, theft and
physical damage insurance covering the related Financed Vehicle;
(xxiii) 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;
(xxiv) 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;
(xxv) 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;
(xxvi) 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
(xxvii) 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, 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, as the case may be, 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
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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)(xxvii), 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.
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; 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 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
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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.
(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, as the case may be,
shall constitute conclusive evidence of the authority of any such Authorized
Officer to act and
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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, as the case may be.
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, 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 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
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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 and 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,
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.
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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 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
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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.
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
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Trustee's and the Indenture Trustee's respective counsel, the Paying Agent, the
Authenticating Agent, the Note Registrar and the Certificate Registrar except
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 June 1999 Collection Period to such
parties no later than July 7, 1999. 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, 1999, 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, 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
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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, 1999, 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:
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
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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 receive pursuant to this Agreement to
(i) Standard & Poor's, Asset-Backed Surveillance Group, 25 Broadway, New York,
New York 10004, (ii) Moody's, ABS Monitoring Dept., 99 Church Street, 4th Floor,
New York, New York 10007 and (iii) to Fitch, 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
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"Note Distribution Account"), bearing a designation clearly indicating
that the funds deposited therein are held for the benefit of the
Noteholders.
Each Account shall be an Eligible Deposit Account established
initially at Chase.
(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 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 July 8, 1999, in the case of investments made
on or after the Deposit Date in June 1999 and prior to the Deposit Date in July
1999, in an amount at least equal to the July 1999 Class A-1 Note Distribution)
except, if the Collection 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. (a) The Servicer shall remit daily
within forty-eight hours of receipt to the Collection Account all Collections
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 ratings of the
Servicer
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are at least P-1 by Moody's, "F1" 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; provided, however, that if the Class A-1
Event has occurred, with respect to Collections received during the June 1999
Collection Period, the Servicer shall remit to the Collection Account on July 8,
1999 an amount of such Collections equal to the July 1999 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 July 8, 1999), 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 July 8, 1999), 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.
(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, 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.
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 June 1999 Collection Period is less than the July 1999 Class
A-1 Note Distribution, such remittances (up to the amount of such shortfall)
shall be deposited into the Collection Account no later than July 8, 1999.
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) 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
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42
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 July 1999 Distribution Date is less
than the July 1999 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 July 8, 1999 a portion of the Reserve Account Transfer
Amount for the July 1999 Distribution Date equal to the lesser of such Reserve
Account Transfer Amount and the amount of such insufficiency as determined by
the Servicer.
(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 Noteholders'
Interest Distributable Amount;
(iv) 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;
(v) except as set forth in Section 5.5(d), to the Note
Distribution Account, the Noteholders' Principal Distributable Amount;
and
(vi) 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
(vii) except as set forth in Section 5.5(d), to the Reserve
Account, any remaining portion of the Total Distribution Amount.
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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 Notes will be deposited in the Note
Distribution Account, and (2) any remaining amounts will be applied pursuant to
clauses (iv), (v), (vi) and (vii) 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 July 1999 Class A-1 Note
Distribution will be deposited in the Note Distribution Account on the July 1999
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 July 1999 Distribution Date with respect to the Class A-2 Notes, the
Class A-3 Notes, the Class A-4 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
July 1999 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 July 1999
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, the Class A-4 Notes and the
Certificates.
SECTION 5.6 Reserve Account. (a) The Seller shall establish
and maintain an Eligible Deposit Account (the "Reserve Account") at Norwest Bank
Minnesota, National Association 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 July 8, 1999 to the extent of the July 1999 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
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(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 July 8, 1999 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 (and that is not either a United States Security Entitlement
or a Security Entitlement) 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 or a Security Entitlement, the Indenture Trustee
shall maintain Control over such Reserve Account Property pending
maturity or disposition; and
(iii) any Reserve Account Property that is an Uncertificated
Security (and that is not a United States Security Entitlement) shall
be delivered to the Indenture Trustee in accordance with paragraph (b)
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 Simpson Thacher & Bartlett,
special counsel to the Indenture Trustee, dated June 17, 1998, 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
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such distributed amounts. For purposes of this Section 5.6(d), the July 1999
Distribution Date shall be July 15, 1999 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.
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, 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 and the Class A-4 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 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 Specified Reserve Account Balance for such
Distribution Date;
(xi) the Total Distribution Amount for such Distribution
Date;
(xii) the Noteholders' Distributable Amount and the
components thereof;
(xiii) the Certificateholders' Distributable Amount and the
components thereof; and
(xiv) 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.
(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.
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(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 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.
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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) 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.
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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 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.
(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
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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.
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,
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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, 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.
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52
(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 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 have
assumed the responsibilities and obligations of the Servicer hereunder in
accordance with Section 8.2.
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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, 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
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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 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
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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
Servicer. 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 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
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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 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, 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 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
Noteholders' Interest Distributable Amount not otherwise deposited into
the Note Distribution Account on such Distribution Date;
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(ii) to the Note Distribution Account, the Outstanding Amount
of the Notes (after giving effect to the reduction in the Outstanding
Amount of the Notes resulting from the deposits made in the Note
Distribution Account on such Distribution Date);
(iii) 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) 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 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, on behalf of the Issuer, 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 reasonably acceptable and 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
<PAGE>
58
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, on behalf of the Issuer, 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, 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 each Certificateholder and the Indenture Trustee, who
shall promptly furnish a copy to each Noteholder 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.
<PAGE>
59
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, 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 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.
<PAGE>
60
(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, 1999, 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 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.
<PAGE>
61
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 Norwest Bank
Minnesota, National Association, Sixth Street and Marquette Avenue, Minneapolis,
Minnesota 55479-0070, Attention: Corporate Trust Office and (d) in the case of
the Issuer and the Owner Trustee, at c/o Wilmington Trust Company, Rodney Square
North, 1100 North Market Street, Wilmington, Delaware 19890, Corporate Trust
Administration. 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 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
<PAGE>
62
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 or, except as expressly provided in the Trust Agreement, as Owner
Trustee of the Issuer have any liability for the representations, warranties,
covenants, agreements or other obligations of the Issuer hereunder or in any of
the certificates, notices or agreements delivered pursuant hereto, as to all of
which recourse shall be had solely to the assets of the Issuer. For all purposes
of this Agreement, in the performance of 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 Norwest Bank Minnesota,
National Association not in its individual capacity but solely as Indenture
Trustee, and in no event shall Norwest Bank Minnesota, National Association 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.
<PAGE>
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,
NATIONAL ASSOCIATION,
as Seller and Servicer
By: /s/ Keith Schuck
------------------------------------
Title: Vice President
CHASE MANHATTAN AUTO OWNER TRUST,
1998-C, as Issuer
By: WILMINGTON TRUST COMPANY,
not in its individual capacity but solely
as Owner Trustee on behalf of the Issuer
By: /s/ Debra Eberly
----------------------------------
Title: Administrative Account Manager
Acknowledged and Accepted:
NORWEST BANK MINNESOTA,
NATIONAL ASSOCIATION
not in its individual capacity,
but solely in its capacity
as Indenture Trustee
By: /s/ Marianna C. Stershic
-------------------------------
Title: Assistant Vice President
<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>
EXECUTION COPY
- -------------------------------------------------------------------------------
CHASE MANHATTAN AUTO OWNER TRUST 1998-C
Class A-1 5.588% Asset Backed Notes
Class A-2 5.747% Asset Backed Notes
Class A-3 5.800% Asset Backed Notes
Class A-4 5.850% Asset Backed Notes
------------------------------
INDENTURE
Dated as of June 1, 1998
------------------------------
Norwest Bank Minnesota, National Association
as Indenture Trustee
- -------------------------------------------------------------------------------
<PAGE>
TABLE OF CONTENTS
-----------------
<TABLE>
<CAPTION>
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ARTICLE I
DEFINITIONS AND INCORPORATION BY REFERENCE
<S> <C>
SECTION 1.1 Definitions............................................................................... 2
SECTION 1.2 Incorporation by Reference of Trust Indenture Act......................................... 2
SECTION 1.3 Usage of Terms............................................................................ 2
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..................................................... 4
SECTION 2.5 Mutilated, Destroyed, Lost or Stolen Notes................................................ 6
SECTION 2.6 Persons Deemed Owner...................................................................... 7
SECTION 2.7 Payment of Principal and Interest; Defaulted Interest..................................... 7
SECTION 2.8 Cancellation.............................................................................. 8
SECTION 2.9 Release of Collateral..................................................................... 8
SECTION 2.10 Book-Entry Notes.......................................................................... 8
SECTION 2.11 Notices to Clearing Agency................................................................ 9
SECTION 2.12 Definitive Notes.......................................................................... 9
SECTION 2.13 Authenticating Agent...................................................................... 10
SECTION 2.14 Appointment of Paying Agent............................................................... 11
ARTICLE III
COVENANTS
SECTION 3.1 Payment of Principal and Interest......................................................... 12
SECTION 3.2 Maintenance of Office or Agency........................................................... 13
SECTION 3.3 Money for Payments To Be Held in Trust.................................................... 13
SECTION 3.4 Existence................................................................................. 14
SECTION 3.5 Protection of Trust Estate................................................................ 14
SECTION 3.6 Opinions as to Trust Estate............................................................... 15
SECTION 3.7 Performance of Obligations; Servicing of Receivables...................................... 15
SECTION 3.8 Negative Covenants........................................................................ 16
SECTION 3.9 Annual Statement as to Compliance......................................................... 17
</TABLE>
i
<PAGE>
<TABLE>
<CAPTION>
Page
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<S> <C>
SECTION 3.10 The Issuer May Consolidate, Etc. Only on Certain Terms................................... 17
SECTION 3.11 Successor or Transferee.................................................................. 19
SECTION 3.12 No Other Business........................................................................ 19
SECTION 3.13 No Borrowing............................................................................. 19
SECTION 3.14 Servicer's Obligations................................................................... 19
SECTION 3.15 Guarantees, Loans, Advances and Other Liabilities........................................ 19
SECTION 3.16 Capital Expenditures..................................................................... 20
SECTION 3.17 Restricted Payments...................................................................... 20
SECTION 3.18 Notice of Events of Default.............................................................. 20
SECTION 3.19 Further Instruments and Acts............................................................. 20
ARTICLE IV
SATISFACTION AND DISCHARGE
SECTION 4.1 Satisfaction and Discharge of Indenture................................................... 20
SECTION 4.2 Application of Trust Money................................................................ 21
SECTION 4.3 Repayment of Moneys Held by Paying Agent.................................................. 22
SECTION 4.4 Duration of the Position of the Indenture Trustee for the Benefit
of Certificateholders..................................................................... 22
ARTICLE V
REMEDIES
SECTION 5.1 Events of Default......................................................................... 22
SECTION 5.2 Acceleration of Maturity; Rescission and Annulment........................................ 23
SECTION 5.3 Collection of Indebtedness and Suits for Enforcement by the
Indenture Trustee......................................................................... 23
SECTION 5.4 Remedies; Priorities...................................................................... 25
SECTION 5.5 Optional Preservation of the Receivables.................................................. 26
SECTION 5.6 Limitation of Suits....................................................................... 27
SECTION 5.7 Unconditional Rights of Noteholders To Receive Principal and
Interest.................................................................................. 27
SECTION 5.8 Restoration of Rights and Remedies........................................................ 28
SECTION 5.9 Rights and Remedies Cumulative............................................................ 28
SECTION 5.10 Delay or Omission Not a Waiver............................................................ 28
SECTION 5.11 Control by Noteholders.................................................................... 28
SECTION 5.12 Waiver of Past Defaults................................................................... 29
SECTION 5.13 Undertaking for Costs..................................................................... 29
SECTION 5.14 Waiver of Stay or Extension Laws.......................................................... 29
SECTION 5.15 Action on Notes........................................................................... 30
SECTION 5.16 Performance and Enforcement of Certain Obligations........................................ 30
</TABLE>
ii
<PAGE>
<TABLE>
<CAPTION>
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ARTICLE VI
THE INDENTURE TRUSTEE
<S> <C>
SECTION 6.1 Duties of the Indenture Trustee........................................................... 31
SECTION 6.2 Rights of the Indenture Trustee........................................................... 32
SECTION 6.3 Individual Rights of the Indenture Trustee................................................ 33
SECTION 6.4 The Indenture Trustee's Disclaimer........................................................ 33
SECTION 6.5 Notice of Defaults........................................................................ 34
SECTION 6.6 Reports by the Indenture Trustee to Holders............................................... 34
SECTION 6.7 Compensation and Indemnity................................................................ 34
SECTION 6.8 Replacement of the Indenture Trustee...................................................... 34
SECTION 6.9 Successor Indenture Trustee by Merger..................................................... 35
SECTION 6.10 Appointment of Co-Indenture Trustee or Separate Indenture
Trustee................................................................................... 36
SECTION 6.11 Eligibility; Disqualification............................................................. 37
SECTION 6.12 Preferential Collection of Claims Against the Issuer...................................... 37
ARTICLE VII
NOTEHOLDERS' LISTS AND REPORTS
SECTION 7.1 The Issuer To Furnish the Indenture Trustee Names and
Addresses of the Noteholders.............................................................. 38
SECTION 7.2 Preservation of Information; Communications to the
Noteholders............................................................................... 38
SECTION 7.3 Reports by the Issuer..................................................................... 38
SECTION 7.4 Reports by the Indenture Trustee.......................................................... 39
ARTICLE VIII
ACCOUNTS, DISBURSEMENTS AND RELEASES
SECTION 8.1 Collection of Money....................................................................... 39
SECTION 8.2 Trust Accounts............................................................................ 39
SECTION 8.3 General Provisions Regarding Accounts..................................................... 41
SECTION 8.4 Release of Trust Estate................................................................... 41
SECTION 8.5 Opinion of Counsel........................................................................ 42
ARTICLE IX
SUPPLEMENTAL INDENTURES
SECTION 9.1 Supplemental Indentures Without Consent of Noteholders.................................... 42
SECTION 9.2 Supplemental Indentures with Consent of the Noteholders................................... 43
</TABLE>
iii
<PAGE>
<TABLE>
<CAPTION>
Page
----
<S> <C>
SECTION 9.3 Effect of Supplemental Indenture.......................................................... 45
SECTION 9.4 Conformity with Trust Indenture Act....................................................... 45
SECTION 9.5 Reference in Notes to Supplemental Indentures............................................. 45
SECTION 9.6 Execution of Supplemental Indentures...................................................... 46
ARTICLE X
REDEMPTION OF NOTES
SECTION 10.1 Redemption............................................................................... 46
SECTION 10.2 Form of Redemption Notice................................................................ 46
SECTION 10.3 Notes Payable on Redemption Date......................................................... 47
ARTICLE XI
MISCELLANEOUS
SECTION 11.1 Compliance Certificates and Opinions, etc................................................ 47
SECTION 11.2 Form of Documents Delivered to the Indenture Trustee..................................... 49
SECTION 11.3 Actions of Noteholders................................................................... 49
SECTION 11.4 Notices, etc., to the Indenture Trustee, the Issuer, and Rating
Agencies................................................................................. 50
SECTION 11.5 Notices to Noteholders; Waiver........................................................... 51
SECTION 11.6 Alternate Payment and Notice Provisions.................................................. 51
SECTION 11.7 Conflict with Trust Indenture Act........................................................ 51
SECTION 11.8 Effect of Headings and Table of Contents................................................. 52
SECTION 11.9 Successors and Assigns................................................................... 52
SECTION 11.10 Separability............................................................................. 52
SECTION 11.11 Benefits of Indenture.................................................................... 52
SECTION 11.12 Legal Holidays........................................................................... 52
SECTION 11.13 GOVERNING LAW............................................................................ 52
SECTION 11.14 Counterparts............................................................................. 52
SECTION 11.15 Recording of Indenture................................................................... 52
SECTION 11.16 Trust Obligation......................................................................... 52
SECTION 11.17 No Petition.............................................................................. 53
SECTION 11.18 Inspection............................................................................... 53
</TABLE>
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 Note Depository Agreement
iv
<PAGE>
<TABLE>
<CAPTION>
CROSS REFERENCE TABLE(1)
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
</TABLE>
- --------
(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.
v
<PAGE>
<TABLE>
<S> <C> <C>
(c) ............................................................................... N.A.
317 (a)(1) ............................................................................... 5.3
(a)(2) ............................................................................... 5.3
(b) ............................................................................... 3.3
318 (a) ............................................................................... 11.7
</TABLE>
vi
<PAGE>
INDENTURE dated as of June 1, 1998, between CHASE MANHATTAN
AUTO OWNER TRUST 1998-C, a Delaware business trust (the "Issuer"), and NORWEST
BANK MINNESOTA, NATIONAL ASSOCIATION, 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 5.588% Asset Backed Notes (the "Class A-1 Notes"), Class A-2 5.747%
Asset Backed Notes (the "Class A-2 Notes"), Class A- 3 5.800% Asset Backed
Notes (the "Class A-3 Notes") and Class A-4 5.850% 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 "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, which is incorporated by reference herein, all
proceeds thereof and all amounts and monies received thereon 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 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
<PAGE>
2
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 June 1, 1998, between the Issuer and Chase Manhattan Bank USA, National
Association, 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.
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
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3
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 24 days for the July 1999 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 and the Class A-4 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 and E,
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 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
and E 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.
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4
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 $258,000,000.00, Class A-2 Notes for original
issue in an aggregate principal amount of $195,000,000.00, Class A-3 Notes for
original issue in the aggregate principal amount of $325,000,000.00 and Class
A-4 Notes for original issue in the aggregate principal amount of
$283,900,000.00. The respective aggregate principal amount of Class A-1 Notes,
Class A-2 Notes, Class A-3 Notes and Class A-4 Notes outstanding at any time
may not exceed such 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
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
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5
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 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 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(a) 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(a) 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.
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6
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 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
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7
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 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 and the Class A-4 Note
set forth in Exhibits B, C, D and E, 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.
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(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 and the Class A-4 Note, set forth in Exhibits B, C, D and E,
respectively. Notwithstanding the foregoing, the entire unpaid principal
amount of the Notes shall be due and payable, if not previously paid, on the
date on which an Event of Default shall have occurred and be continuing, if
the Indenture Trustee or 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. 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 Note, except as provided in
Section 2.12. Unless and until Definitive Notes have been issued to Note
Owners pursuant to Section 2.12:
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9
(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 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
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10
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. 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. 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
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11
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
-------------------------------------
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. 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.
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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;
(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
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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 and (iv) for the
benefit of the Class A-4 Notes, to the holders of the Class A-4 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.
SECTION 3.2 Maintenance of Office or Agency. The Issuer will
maintain 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
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14
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 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 such Trust
Estate against the claims of all persons and parties.
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15
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, 1999, the Issuer shall furnish to the Indenture Trustee an
Opinion of Counsel either stating that, in the opinion of such counsel, such
action has been taken with respect to the recording, filing, re-recording and
refiling of this Indenture, any indentures supplemental hereto and any other
requisite documents and with respect to the execution and filing of any
financing statements and continuation statements as 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, re-recording and refiling of this Indenture, any indentures
supplemental hereto and any other requisite documents and the execution and
filing of any financing statements and continuation statements that will, in
the opinion of such counsel, be required to maintain the 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 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
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16
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:
(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
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(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, 1999, 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
(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;
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(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 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;
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19
(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 1998-C 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 stating
that Chase Manhattan Auto Owner Trust 1998-C 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.
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20
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, 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 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,
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21
(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,
(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
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22
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 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
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23
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 the Indenture Trustee by the Holders of at least 25% of
the Outstanding Amount of the 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 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 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 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
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24
of collection, including the reasonable compensation, expenses, disbursements
and advances of the Indenture Trustee and its agents and counsel.
(b) In case the Issuer shall fail forthwith to pay such
amounts upon such demand, the Indenture Trustee, in its own name and as
trustee of an express trust, may institute a proceeding for the collection of
the sums so due and unpaid, and may prosecute such proceeding to judgment or
final decree, and may enforce the same against the Issuer or other obligor
upon such Notes and collect in the manner provided by law out of the property
of the Issuer or other obligor upon such Notes, wherever situated, the moneys
adjudged or decreed to be payable.
(c) If an Event of Default occurs and is continuing, the
Indenture Trustee may, as more particularly provided in Section 5.4, 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
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;
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25
(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.
(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
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26
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 Notes. In determining such sufficiency or insufficiency with
respect to clause (B) and (C), the Indenture Trustee may, but need not, obtain
and rely upon an opinion of an Independent investment banking or accounting
firm of national reputation as to the feasibility of such proposed action and
as to the sufficiency of the Trust Estate for such purpose.
(b) If the Indenture Trustee collects any money or property
pursuant to this Article V, it shall pay out 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
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27
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 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 period by the
Holders of a majority of the Outstanding Amount of the 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 Notes, each representing less than a majority of the Outstanding Amount of
the Notes, the Indenture Trustee in its sole discretion may determine what
action, if any, shall be taken, notwithstanding any other provisions of this
Indenture.
SECTION 5.7 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
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28
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 exercise any
right or remedy accruing upon any Default or Event of Default shall impair any
such right or remedy or constitute a waiver of any such Default or Event of
Default or an acquiescence therein. Every right and remedy given by this
Article V or by law to the Indenture Trustee or to the Noteholders may be
exercised from time to time, and as often as may be deemed expedient, by the
Indenture Trustee or by the Noteholders, as the case may be.
SECTION 5.11 Control by Noteholders. The Holders of a
majority of the Outstanding Amount of the Notes shall have the right to direct
the time, method and place of conducting any proceeding for any remedy
available to the Indenture Trustee with respect to the Notes or exercising any
trust or power conferred on the Indenture Trustee; provided that
(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 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 Notes to sell or liquidate the Trust Estate
shall be of no force and effect;
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29
(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 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 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
<PAGE>
30
wherever enacted, now or at any time hereafter in force, that may affect the
covenants or the performance of this Indenture; and the Issuer (to the extent
that it may lawfully do so) hereby expressly waives all benefit or advantage
of any such law, and covenants that it will not hinder, delay or impede the
execution of any power herein granted to the Indenture Trustee, but will
suffer and permit the execution of every such power as though no such law had
been enacted.
SECTION 5.15 Action on Notes. The Indenture Trustee's right
to seek and recover judgment on the Notes or under this Indenture shall not be
affected by the seeking, obtaining or application of any other relief under or
with respect to this Indenture. Neither the lien of this Indenture nor any
rights or remedies of the Indenture Trustee or the Noteholders shall be
impaired by the recovery of any judgment by the Indenture Trustee against the
Issuer or by the levy of any execution under such judgment upon any portion of
the Trust Estate or upon any of the assets of the Issuer.
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 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.
<PAGE>
31
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 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
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32
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.
(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
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33
misconduct or negligence on the part of, or for the supervision of, any such
agent, attorney, custodian or nominee appointed with due care by it hereunder.
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) 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 (f) 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.
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.
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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 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;
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(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.
(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
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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 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;
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(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 behalf and in its name. If any separate
trustee or co-trustee shall die, become incapable of acting, resign or be
removed, all of its estates, properties, rights, remedies and trusts shall
vest in and be exercised by the Indenture Trustee, to the extent permitted by
law, without the appointment of a new or successor trustee.
SECTION 6.11 Eligibility; Disqualification. The Indenture
Trustee shall at all times satisfy the requirements of TIA ss.310(a). The
Indenture Trustee shall have a combined capital and surplus of at least
$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 ss.310(b),
including the optional provision permitted by the second sentence of TIA
ss.310(b)(9); provided that there shall be excluded from the operation of TIA
ss.310(b)(1) any indenture or indentures under which other securities of the
Issuer are outstanding if the requirements for such exclusion set forth in the
TIA ss.310(b)(1) are met.
SECTION 6.12 Preferential Collection of Claims Against the Issuer.
The Indenture Trustee shall comply with TIA ss.311(a), excluding any creditor
relationship listed in TIA ss.311(b). A Indenture Trustee who has resigned or
been removed shall be subject to TIA ss.311(a) to the extent indicated
therein.
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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.
(b) The Noteholders may communicate pursuant to TIA
ss.312(b) with other Noteholders with respect to their rights under this
Indenture or under the Notes.
(c) The Issuer, the Indenture Trustee and the Note Registrar
shall have the protection of TIA ss.312(c).
SECTION 7.3 Reports by the Issuer. (a) The Issuer shall:
(i) file with the Indenture Trustee within 15 days
after the Issuer is required to file the same with the Commission,
copies of the annual reports and of the information, documents and
other reports (or copies of such portions of any of the foregoing as
the Commission may from time to time by rules and regulations
prescribe) 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 the
Commission in accordance with rules and regulations prescribed from
time to time by the Commission such additional information, documents
and reports with respect to compliance by the Issuer with the
conditions and covenants of this Indenture as may be required from
time to time by such rules and regulations; and
(iii) supply to the Indenture Trustee (and the
Indenture Trustee shall transmit by mail to all Noteholders described
in TIA ss.313(c)) such summaries of any information, documents and
reports required to be filed by the Issuer pursuant to
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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 ss. 313(a), within 60 days after each March 31, beginning with March 31,
1999 the Indenture Trustee shall mail to each Noteholder as required by TIA
ss. 313(c) a brief report dated as of such date that complies with TIA ss.
313(a). The Indenture Trustee also shall comply with TIA ss. 313(b). A copy of
each report at the time of its mailing to Noteholders shall be filed by the
Indenture Trustee with the Commission and each stock exchange, if any, on
which the Notes are listed. The Issuer shall notify the Indenture Trustee if
and when the Notes are listed on any stock exchange. 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.
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
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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 Notes; provided
that if there are not sufficient funds in the Note Distribution
Account to pay the entire amount of accrued and unpaid interest then
due on the Notes, the amount in the Note Distribution Account shall
be applied to the payment of such interest on the Notes pro rata on
the basis of the total such interest due on the Notes;
(ii) unless otherwise provided in clause (vi) 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) unless otherwise provided in clause (vi) 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) unless otherwise provided in clause (vi) 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) unless otherwise provided in clause (vi) 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) 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 Notes pro rata on the basis of the respective unpaid principal
amount of each such Note.
(d) Notwithstanding anything in this Section 8.2 to the
contrary (but subject to clause (vi) 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 July 1999 Distribution Date with respect
to the Class A-1 Notes will distributed pursuant to clauses (i) and (ii) of
Section 8.2(c) on such date, and amounts deposited into the Note Distribution
Account with respect to the Class A-2, the Class A-3 and the Class A-4 on the
applicable July 1999 Distribution Date with respect to the Class A-2 Notes,
the Class A-3 Notes and the Class A-4 Notes will be distributed pursuant to
clauses (i), (iii), (iv), and (v) of Section 8.2(c).
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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 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
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bound to ascertain the Indenture Trustee's authority, inquire into the
satisfaction of any conditions precedent or see to the application of any
moneys.
(b) The Indenture Trustee shall, at such time as there are
no Notes Outstanding, and all sums due the Indenture Trustee pursuant to
Section 6.7 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 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 ss.ss. 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.
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 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
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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 similar federal statute
hereafter enacted and to add to this Indenture such other provisions
as may be expressly required by the TIA.
The Indenture Trustee is hereby authorized to join in the
execution of any such supplemental indenture and to make any further
appropriate agreements and stipulations that may be therein contained.
(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 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
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the Rating Agencies 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 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
<PAGE>
45
(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.
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.
<PAGE>
46
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.
ARTICLE X
REDEMPTION OF NOTES
SECTION 10.1 Redemption. The Class A-4 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 the Class A-4 Notes
to be redeemed, whereupon all such Class A-4 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-4 Notes, 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-4 Notes and
the place where such Class A-4 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-4 Notes shall
cease to accrue on the Redemption Date.
<PAGE>
47
Notice of redemption of the Class A-4 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-4 Notes shall not impair or affect the validity of the redemption of
any other Class A-4 Note.
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
<PAGE>
48
(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 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 $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
<PAGE>
49
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, 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
<PAGE>
50
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 1998-C, in care
of Wilmington Trust Company, 1100 North Market Street, Rodney Square
North, Wilmington, Delaware 19890-0001, Attention: Corporate Trust
Administration or at any other address 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.
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 Standard & Poor's, at the following address: Standard & Poor's Ratings
Service, 26 Broadway (15th Floor), New York, New York 10004, Attention: Asset
Backed Surveillance Department and (iii) in the case of Fitch, at the
following address: Fitch IBCA Inc., 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.
<PAGE>
51
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 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 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 ss.ss. 310 through 317 that impose
duties on any person (including the provisions automatically deemed included
herein unless expressly excluded by this Indenture) are a part of and govern
this Indenture, whether or not physically contained herein.
<PAGE>
52
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 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
<PAGE>
53
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.
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>
54
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 1998-C
By: WILMINGTON TRUST COMPANY,
not in its individual capacity but
solely as Owner Trustee
By:/s/ Debra Eberly
-----------------------------------
Title: Administrative Account
Manager
NORWEST BANK MINNESOTA,
NATIONAL ASSOCIATION,
not in its individual capacity but solely
as Indenture Trustee
By: /s/ Marianna Stershic
--------------------------------------
Title: Assistant Vice President
<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 $ 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 1998-C
5.588% CLASS A-1 ASSET BACKED NOTES
Chase Manhattan Auto Owner Trust 1998-C, 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
July 1999 Distribution Date (which is July 9, 1999). 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 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 June 17, 1998. Interest will be computed on
the basis of actual days elapsed in a 360-day year (which is 24 days in the
case
- -----------------------
1 Denominations of $1,000 and integral multiples of $1,000 in excess thereof.
<PAGE>
2
of July 1999 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
1998-C
By: WILMINGTON TRUST COMPANY,
not in its individual capacity but solely as
Owner Trustee under the Trust Agreement
By:
----------------------------------------
Name:
Title:
<PAGE>
3
INDENTURE TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Notes designated above and referred to in
the within mentioned Indenture.
Dated: ________ __, 199_
NORWEST BANK MINNESOTA,
NATIONAL ASSOCIATION,
not in its individual capacity but solely
as Indenture Trustee
By:
--------------------------------------
Authorized Signatory
<PAGE>
4
[REVERSE OF NOTE]
This Note is one of a duly authorized issue of Notes of the
Issuer, designated as its 5.588% Class A-1 Asset Backed Notes (herein called
the "Class A-1 Notes" or the "Notes"), all issued under an Indenture dated as
of June 1, 1998 (such Indenture, as supplemented or amended, is herein called
the "Indenture"), between the Issuer and Norwest Bank Minnesota, National
Association, 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 are and will be equally and ratably secured by the collateral
pledged as security therefor 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, 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 indebtedness of the Issuer for such tax purposes.
<PAGE>
5
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>
6
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 1998-C
5.747% CLASS A-2 ASSET BACKED NOTES
Chase Manhattan Auto Owner Trust 1998-C, 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
August 2000 Distribution Date. 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
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 June 17, 1998. 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.
- --------------------
1/ Denominations of $1,000 and integral multiples of $1,000 in excess thereof.
<PAGE>
2
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
1998-C
By: WILMINGTON TRUST COMPANY,
not in its individual capacity but solely as
Owner Trustee under the Trust Agreement
By:
------------------------------------------
Name:
Title:
<PAGE>
3
INDENTURE TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Notes designated above and referred to in
the within-mentioned Indenture.
Dated: ________ __, 199_
NORWEST BANK MINNESOTA,
NATIONAL ASSOCIATION,
not in its individual capacity but solely
as Indenture Trustee
By:
--------------------------------------
Authorized Signatory
<PAGE>
4
[REVERSE OF NOTE]
This Note is one of a duly authorized issue of Notes of the
Issuer, designated as its 5.747% Class A-2 Asset Backed Notes (herein called
the "Class A-2 Notes" or the "Notes"), all issued under an Indenture dated as
of June 1, 1998 (such Indenture, as supplemented or amended, is herein called
the "Indenture"), between the Issuer and Norwest Bank Minnesota, National
Association, 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 are and will be equally and ratably secured by the collateral
pledged as security therefor 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 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 indebtedness of the Issuer for such tax purposes.
<PAGE>
5
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>
6
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 1998-C
5.800% CLASS A-3 ASSET BACKED NOTES
Chase Manhattan Auto Owner Trust 1998-C, 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
January 2002 Distribution Date. 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
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 June 17, 1998. Interest will be computed on the basis of a 360-day
year of twelve 30-day
- -------------------
1/ Denominations of $1,000 and integral multiples of $1,000 in excess thereof.
<PAGE>
2
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
1998-C
By: WILMINGTON TRUST COMPANY,
not in its individual capacity but solely as
Owner Trustee under the Trust Agreement
By:
----------------------------------------
Name:
Title:
<PAGE>
3
INDENTURE TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Notes designated above and referred to in
the within-mentioned Indenture.
Dated: ________ __, 199_
NORWEST BANK MINNESOTA,
NATIONAL ASSOCIATION,
not in its individual capacity but solely
as Indenture Trustee
By:
--------------------------------------
Authorized Signatory
<PAGE>
4
[REVERSE OF NOTE]
This Note is one of a duly authorized issue of Notes of the
Issuer, designated as its 5.800% Class A-3 Asset Backed Notes (herein called
the "Class A-3 Notes" or the "Notes"), all issued under an Indenture dated as
of June 1, 1998 (such Indenture, as supplemented or amended, is herein called
the "Indenture"), between the Issuer and Norwest Bank Minnesota, National
Association, 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 are and will be equally and ratably secured by the collateral
pledged as security therefor 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, 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
indebtedness of the Issuer for such tax purposes.
<PAGE>
5
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>
6
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 $ 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 1998-C
5.850% CLASS A-4 ASSET BACKED NOTES
Chase Manhattan Auto Owner Trust 1998-C, 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 May 2003 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 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
- --------------------
1/ Denominations of $1,000 and integral multiples of $1,000 in excess thereof.
<PAGE>
2
June 17, 1998. 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
1998-C
By: WILMINGTON TRUST COMPANY,
not in its individual capacity but solely as
Owner Trustee under the Trust Agreement
By:
------------------------------------------
Name:
Title:
<PAGE>
3
INDENTURE TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Notes designated above and referred to in
the within-mentioned Indenture.
Dated: ________ __, 199_
NORWEST BANK MINNESOTA,
NATIONAL ASSOCIATION,
not in its individual capacity but solely
as Indenture Trustee
By:
-------------------------------------------
Authorized Signatory
<PAGE>
4
[REVERSE OF NOTE]
This Note is one of a duly authorized issue of Notes of the
Issuer, designated as its 5.850% Class A-4 Asset Backed Notes (herein called
the "Class A-4 Notes" or the "Notes"), all issued under an Indenture dated as
of June 1, 1998 (such Indenture, as supplemented or amended, is herein called
the "Indenture"), between the Issuer and Norwest Bank Minnesota, National
Association, 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 are and will be equally and ratably secured by the collateral
pledged as security therefor 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, 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 for such tax purposes as indebtedness of the Issuer.
<PAGE>
5
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>
6
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
Note Depository Agreement
<PAGE>
EXECUTION COPY
--------------
CHASE MANHATTAN AUTO OWNER TRUST 1998-C
TRUST AGREEMENT
between
CHASE MANHATTAN BANK USA, NATIONAL ASSOCIATION,
as Depositor
and
WILMINGTON TRUST COMPANY,
as Owner Trustee
Dated as of June 1, 1998
<PAGE>
<TABLE>
<CAPTION>
TABLE OF CONTENTS
Page
----
ARTICLE I
DEFINITIONS
<S> <C>
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...................................... 3
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.................................................................. 5
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............................... 6
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.................................................... 8
SECTION 3.7 Access to List of Certificateholders' Names and
Addresses............................................................................ 9
SECTION 3.8 Maintenance of Office or Agency...................................................... 9
SECTION 3.9 Appointment of Paying Agent.......................................................... 9
SECTION 3.10 Book-Entry Certificates.............................................................. 10
SECTION 3.11 Notices to Clearing Agency........................................................... 11
SECTION 3.12 Definitive Certificates.............................................................. 11
</TABLE>
i
<PAGE>
<TABLE>
<S> <C>
SECTION 3.13 Authenticating Agent................................................................. 12
SECTION 3.14 Actions of Certificateholders........................................................ 13
ARTICLE IV
ACTIONS BY OWNER TRUSTEE
SECTION 4.1 Prior Notice to Certificateholders with Respect to
Certain Matters...................................................................... 14
SECTION 4.2 Action by Certificateholders with Respect to Certain
Matters.............................................................................. 14
SECTION 4.3 Action by Certificateholders with Respect to
Bankruptcy........................................................................... 15
SECTION 4.4 Restrictions on Certificateholders' Power............................................ 15
SECTION 4.5 Majority Control..................................................................... 15
ARTICLE V
APPLICATION OF TRUST FUNDS; CERTAIN DUTIES
SECTION 5.1 Establishment of Certificate Distribution Account.................................... 15
SECTION 5.2 Application of Funds in Certificate Distribution
Account.............................................................................. 16
SECTION 5.3 Method of Payment.................................................................... 16
SECTION 5.4 No Segregation of Monies; No Interest................................................ 17
SECTION 5.5 Accounting and Reports to the Noteholders,
Certificateholders, the Internal Revenue Service and Others.......................... 17
SECTION 5.6 Signature on Returns; Tax Matters Partner............................................ 17
SECTION 5.7 Capital Accounts..................................................................... 17
ARTICLE VI
AUTHORITY AND DUTIES OF OWNER TRUSTEE
SECTION 6.1 General Authority.................................................................... 18
SECTION 6.2 General Duties....................................................................... 19
SECTION 6.3 Action upon Instruction.............................................................. 19
SECTION 6.4 No Duties Except as Specified in this Agreement or in
Instructions......................................................................... 19
SECTION 6.5 No Action Except under Specified Documents or
Instructions......................................................................... 20
SECTION 6.6 Restrictions......................................................................... 20
SECTION 6.7 Doing Business in Other Jurisdictions................................................ 20
</TABLE>
ii
<PAGE>
ARTICLE VII
CONCERNING OWNER TRUSTEE
<TABLE>
<S> <C>
SECTION 7.1 Acceptance of Trusts and Duties...................................................... 21
SECTION 7.2 Furnishing of Documents.............................................................. 23
SECTION 7.3 Representations and Warranties....................................................... 23
SECTION 7.4 Reliance; Advice of Counsel.......................................................... 24
SECTION 7.5 Not Acting in Individual Capacity.................................................... 24
SECTION 7.6 Owner Trustee May Own Certificates and Notes......................................... 24
ARTICLE VIII
COMPENSATION OF OWNER TRUSTEE
SECTION 8.1 Owner Trustee's Fees and Expenses.................................................... 25
SECTION 8.2 Indemnification...................................................................... 25
SECTION 8.3 Payments to Owner Trustee............................................................ 26
ARTICLE IX
TERMINATION OF TRUST AGREEMENT
SECTION 9.1 Termination of Trust Agreement....................................................... 26
ARTICLE X
SUCCESSOR OWNER TRUSTEES AND ADDITIONAL OWNER TRUSTEES
SECTION 10.1 Eligibility Requirements for Owner Trustee........................................... 27
SECTION 10.2 Resignation or Removal of Owner Trustee.............................................. 27
SECTION 10.3 Successor Owner Trustee.............................................................. 28
SECTION 10.4 Merger or Consolidation of Owner Trustee............................................. 29
SECTION 10.5 Appointment of Co-Trustee or Separate Trustee........................................ 29
ARTICLE XI
MISCELLANEOUS
SECTION 11.1 Supplements and Amendments........................................................... 30
SECTION 11.2 No Legal Title to Owner Trust Estate in
Certificateholders................................................................... 31
SECTION 11.3 Limitations on Rights of Others...................................................... 32
SECTION 11.4 Notices.............................................................................. 32
SECTION 11.5 Severability......................................................................... 32
SECTION 11.6 Separate Counterparts................................................................ 32
SECTION 11.7 Successors and Assigns............................................................... 32
</TABLE>
iii
<PAGE>
<TABLE>
<S> <C>
SECTION 11.8 No Recourse.......................................................................... 32
SECTION 11.9 [Reserved]........................................................................... 33
SECTION 11.10 Headings............................................................................. 33
SECTION 11.11 GOVERNING LAW........................................................................ 33
SECTION 11.12 Certificate Transfer Restrictions.................................................... 33
</TABLE>
EXHIBITS
Exhibit A - Form of Certificate
Exhibit B - Form of Certificate of Trust
Exhibit C - Form of Certificate Depository Agreement
iv
<PAGE>
1
TRUST AGREEMENT dated as of June 1, 1998 between CHASE MANHATTAN BANK
USA, NATIONAL ASSOCIATION ("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 WILMINGTON TRUST COMPANY, a Delaware 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 June 1, 1998, 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.
<PAGE>
2
ARTICLE II
ORGANIZATION
SECTION 2.1 Name. The trust created hereby shall be known
as "Chase Manhattan Auto Owner Trust 1998-C" (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 with the foregoing
or other than as required or authorized by the terms of this Agreement or the
other Basic Documents.
<PAGE>
3
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. 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:
<PAGE>
4
(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 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 (as defined herein) 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 2.13 of this Agreement and for
purposes of maintaining Capital Accounts under Section 5.7 of this Agreement
as follows:
<PAGE>
5
(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 to 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 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 gross 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; provided, that
<PAGE>
6
subsequent allocations of gross income and gain, or deductions, shall take
into account any special allocations made to a Certificateholder under this
Section 2.13 and shall be adjusted so that the amount of gross income and
gain, or deductions, allocated to a Certificateholder will equal the amount of
gross income and gain, or deductions, that would have been allocated to such
Certificateholder had no such special allocations been made to such
Certificateholder under this Section 2.13. 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
May 13, 1998 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 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
<PAGE>
7
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 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
<PAGE>
8
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 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
<PAGE>
9
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 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
<PAGE>
10
additional Paying Agent shall agree with the Owner Trustee that as Paying
Agent, such successor Paying Agent or additional Paying Agent will hold all
sums, if any, held by it for payment to the Certificateholders in trust for
the benefit of the Certificateholders entitled thereto until such sums shall
be paid to such Certificateholders. The Paying Agent shall return all
unclaimed funds to the Owner Trustee and upon 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
<PAGE>
11
instructions from the Clearing Agency Participants, and
all references in this Agreement to distributions,
notices, reports and statements to Certificate- holders
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 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
<PAGE>
12
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
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.
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13
(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.
(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.
<PAGE>
14
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;
(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
<PAGE>
15
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.
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.
<PAGE>
16
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.
(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 nonUnited 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
<PAGE>
17
$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.
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:
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(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.
(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 $258,000,000.00, Class
A-2 Notes in the aggregate principal amount of $195,000,000.00, Class A-3
Notes in the aggregate principal amount of $325,000,000.00 and Class A-4 Notes
in the aggregate principal amount of $283,900,000.00. 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.
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19
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 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 or obligation to manage, make any
payment with respect to, register, record, sell, dispose of, or otherwise deal
with the Owner Trust Estate, or
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20
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 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)
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21
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 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
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22
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 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
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23
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 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
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24
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 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,
Wilmington Trust Company 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.
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25
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
7.2 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, 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.
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26
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, 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.
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27
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 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
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28
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 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
<PAGE>
29
Owner Trustee, the 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), 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
<PAGE>
30
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 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.
<PAGE>
31
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, 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.
<PAGE>
32
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 Wilmington Trust Company, Rodney Square North, 1100 North Market
Street, Wilmington, Delaware 19890-0001, Attn: Corporate Trust Department, 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.
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
<PAGE>
33
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 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.
<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.
WILMINGTON TRUST COMPANY,
as Owner Trustee
By: /s/ Debra Eberly
-----------------------------------------
Title: Administrative Account Manager
CHASE MANHATTAN BANK USA,
NATIONAL ASSOCIATION,
as Depositor
By: /s/ Keith Schuck
-----------------------------------------
Title: Vice President
<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.
<PAGE>
2
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.
CHASE MANHATTAN AUTO OWNER TRUST 1998-C
6.000% 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, National Association, a
national banking association.
(This Certificate does not represent an interest in or obligation of Chase
Manhattan Bank USA, National Association 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 1998-C (the "Issuer") formed by Chase Manhattan Bank USA, National
Association, a national banking association (the "Depositor"). This
Certificate has a Certificate Rate of 6.000% per annum.
<PAGE>
3
OWNER TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Trust Agreement.
WILMINGTON TRUST COMPANY, WILMINGTON TRUST COMPANY,
not in its individual capacity or not in its individual capacity but
but solely as Owner Trustee solely as Owner Trustee
By: By:
----------------------- ---------------------------------
Authenticating Agent
<PAGE>
4
Issuer was created pursuant to a Trust Agreement dated as of June 1,
1998 (the "Trust Agreement"), between the Depositor and Wilmington Trust
Company, 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, National Association, as Seller and Servicer,
dated as of June 1, 1998, 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 "6.000% Asset Backed Certificates" (herein called the
"Certificates"). Issued under the Indenture dated as of June 1, 1998, between
the Issuer and Norwest Bank Minnesota, National Association, as trustee (the
"Indenture"), are four classes of Notes designated as "Class A-1 5.588% Asset
Backed Notes" (the "Class A-1 Notes"), "Class A-2 5.747% Asset Backed Notes"
(the "Class A-2 Notes"), "Class A-3 5.800% Asset Backed Notes" (the "Class A-3
Notes") and "Class A-4 5.850% Asset Backed Notes" (the "Class A-4 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.
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.
<PAGE>
5
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.
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 1998-C
By: WILMINGTON TRUST COMPANY,
not in its individual capacity,
but solely as Owner Trustee
Dated: By:
-------------------------------
<PAGE>
6
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.
<PAGE>
EXHIBIT B
CERTIFICATE OF TRUST
<PAGE>
EXHIBIT C
CERTIFICATE DEPOSITORY AGREEMENT
<PAGE>
EXECUTION COPY
--------------
- --------------------------------------------------------------------------------
CHASE MANHATTAN AUTO OWNER TRUST 1998-C
Class A-1 5.588% Asset Backed Notes
Class A-2 5.747% Asset Backed Notes
Class A-3 5.800% Asset Backed Notes
Class A-4 5.850% Asset Backed Notes
------------------------------------
ADMINISTRATION AGREEMENT
Dated as of June 1, 1998
------------------------------------
The Chase Manhattan Bank,
Administrator
- --------------------------------------------------------------------------------
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
<S> <C>
SECTION 1. Duties of Administrator.................................................................... 2
SECTION 2. Records.................................................................................... 7
SECTION 3. Compensation............................................................................... 7
SECTION 4. Additional Information To Be Furnished to Issuer........................................... 7
SECTION 5. Independence of Administrator.............................................................. 7
SECTION 6. No Joint Venture........................................................................... 7
SECTION 7. Other Activities of Administrator.......................................................... 8
SECTION 8. Term of Agreement; Resignation and Removal of Administrator................................ 8
SECTION 9. Action upon Termination, Resignation or Removal............................................ 9
SECTION 10. Notices................................................................................... 10
SECTION 11. Amendments................................................................................ 11
SECTION 12. Successors and Assigns.................................................................... 11
SECTION 13. GOVERNING LAW............................................................................. 12
SECTION 14. Headings.................................................................................. 12
SECTION 15. Counterparts.............................................................................. 12
SECTION 16. Severability.............................................................................. 12
SECTION 17. Not Applicable to The Chase Manhattan Bank in Other
Capacities................................................................................ 12
SECTION 18. Limitation of Liability of Owner Trustee, Indenture Trustee and
Administrator............................................................................. 12
SECTION 19. Third-Party Beneficiary................................................................... 13
SECTION 20. Nonpetition Covenants..................................................................... 13
SECTION 21. Liability of Administrator................................................................ 13
EXHIBIT A - Form of Power of Attorney
</TABLE>
<PAGE>
ADMINISTRATION AGREEMENT dated as of June 1, 1998, among
CHASE MANHATTAN AUTO OWNER TRUST 1998-C, a Delaware business trust (the
"Issuer"), THE CHASE MANHATTAN BANK, a New York banking corporation, as
administrator (the "Administrator"), and NORWEST BANK MINNESOTA, NATIONAL
ASSOCIATION, a national 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 5.588% Asset
Backed Notes (the "Class A-1 Notes"), the Class A-2 5.747% Asset Backed Notes
(the "Class A-2 Notes"), the Class A-3 5.800% Asset Backed Notes (the "Class
A-3 Notes") and the Class A-4 5.850% 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 "Notes") pursuant to the Indenture dated as of June 1,
1998 (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 6.000% Asset Backed Certificates (the
"Certificates") pursuant to the Trust Agreement dated as of June 1, 1998 (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 Wilmington Trust Company, 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 June 1, 1998 (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 June 17, 1998 (the "Note Depository Agreement") among the Issuer, the
Indenture Trustee, The Chase Manhattan Bank, as Agent (the "Agent") and The
Depository Trust Company, and (iii) a Depository Agreement dated June 17, 1998
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) the Trust Agreement,
and (v) the Indenture (the Sale and Servicing Agreement, the Trust Agreement,
the Depository Agreements 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 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;
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2
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:
SECTION 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 Agreements. 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 Agreements. 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 Agreements. 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 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 for registration of transfer or exchange of Notes (Section
3.2);
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3
(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));
(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);
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4
(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);
(V) 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);
(W) the preparation and, after execution by the Issuer, the
filing with the Commission and 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);
(X) 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);
(Y) 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);
(Z) the execution of new Notes conforming to any
supplemental indenture (Section 9.5);
(aa) provide the Indenture Trustee with the form of notice
necessary to deliver the notification of Noteholders of redemption of
the Notes (Section 10.2);
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5
(bb) 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));
(cc) 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));
(dd) 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); and
(ee) the recording of the Indenture, if applicable (Section
11.15).
(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
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6
obligations of the Administrator thereunder. In connection with paragraph (ii)
above, the Accountants will provide prior to July 15, 1998 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 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) 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.
(vi) 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.
(vii) 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:
(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;
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7
(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.
SECTION 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.
SECTION 3. Compensation. As compensation for the performance
of the Administrator's obligations under this Agreement, the Administrator
shall be entitled to $1,000 per month which shall be payable in accordance
with Section 5.5 of the Sale and Servicing Agreement.
SECTION 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(a)(i)
hereof.
SECTION 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.
SECTION 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.
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8
SECTION 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.
SECTION 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
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
<PAGE>
9
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 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.
SECTION 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
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10
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.
SECTION 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
Wilmington Trust Company
Rodney Square North
1100 North Market Street
Wilmington, Delaware 19890-0001
Attention: Corporate Trust Administration
with a copy to:
Chase Automotive Finance Corporation
900 Stewart Avenue
Garden City, New York 11530
Attention: Financial Controller
(b) if to the Administrator, to
The Chase Manhattan Bank
450 West 33rd Street
15th Floor
New York, New York 10001-2697
Attention: Structured Finance/Chase Auto
(c) if to the Indenture Trustee, to
Norwest Bank Minnesota, National Association
Sixth Street and Marquette Avenue
Minneapolis, Minnesota 55479
(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
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11
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.
SECTION 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 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.
SECTION 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.
SECTION 13. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED
BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF
NEW YORK.
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12
SECTION 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.
SECTION 15. Counterparts. This Agreement may be executed in
counterparts, each of which when so executed shall together constitute but one
and the same agreement.
SECTION 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.
SECTION 17. Not Applicable to The Chase Manhattan Bank in
Other Capacities. Nothing in this Agreement shall affect any obligation The
Chase Manhattan Bank may have in any other capacity.
SECTION 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 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 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 Norwest Bank Minnesota, National
Association, not in its individual capacity but solely as Indenture Trustee,
and in no event shall Norwest Bank Minnesota, National Association 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
<PAGE>
13
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.
SECTION 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.
SECTION 20. 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.
SECTION 21. 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.
<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
1998-C
By: WILMINGTON TRUST COMPANY,
not in its individual capacity
but solely as Owner Trustee,
By: /s/ Debra Eberly
-----------------------------------
Name: Debra Eberly
Title: Administrative Account
Manager
NORWEST BANK, MINNESOTA,
NATIONAL ASSOCIATION,
not in its individual capacity
but solely as Indenture Trustee,
By: /s/ Marianna Stershic
Name: Marianna Stershic
Title: Assistant Vice President
THE CHASE MANHATTAN BANK,
as Administrator
By: /s/ Kimberly K. Costa
-----------------------------------
Name: Kimberly K. Costa
Title: Second Vice President
<PAGE>
15
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 Wilmington Trust Company, a
Delaware banking corporation, not in its individual capacity but solely as
owner trustee ("Owner Trustee") for Chase Manhattan Auto Owner Trust 1998-C
("Trust"), does hereby make, constitute and appoint THE CHASE MANHATTAN BANK
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 June
1, 1998 among the Trust, The Chase Manhattan Bank, as Administrator, and
Norwest Bank Minnesota, National Association, 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 _______, 1998.
WILMINGTON TRUST COMPANY,
not in its individual capacity
but solely as Owner Trustee
By:
-------------------------------
Name:
Title:
