<PAGE> 1
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) November 28, 1995
FORD CREDIT 1995-B GRANTOR TRUST
(Ford Credit Auto Receivables Corporation - Originator)
(Exact name of registrant as specified in its charter)
Delaware 33-63345 38-2973806
(State of other juris- (Commission File Number) (IRS Employer
diction of incorporation) I.D. No.)
The American Road, Dearborn, Michigan 48121
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code 313-322-3000
<PAGE> 2
Item 5. Other Events
Ford Credit 1995-B Grantor Trust (the "Trust"), originated by Ford Credit
Auto Receivables Corporation (the "Company"), under the laws of New York, has
registered with the Securities and Exchange Commission under the Securities
Act of 1933, as amended, 5.90% Asset Backed Certificates, Class A, in the
aggregate principal amount of $1,636,265,306.01 (the "Certificates"),
pursuant to Registration Statement No. 33-63345. As of November 1, 1995,
Ford Motor Credit Company ("Ford Credit"), as seller, and the Company, as
purchaser, entered into a Purchase Agreement dated as of November 1, 1995,
(the "Purchase Agreement"), transferring from Ford Credit to the Company
property primarily consisting of retail installment sale contracts secured by
new and used automobiles and light trucks, certain monies due thereunder,
security interests in the vehicles financed thereby and certain other
property (the "Property"). As of November 1, 1995, Ford Credit, as servicer,
the Company, as seller, and Chemical Bank as Trustee, entered into a Pooling
and Servicing Agreement, dated as of November 1, 1995, creating the Trust and
transferring from the Company to the Trust the Property. In return for the
property, the Trust transferred to the Company Certificates in the principal
amount of $1,750,016,370.06. Detailed information on the pool of retail
installment sale contracts in the Trust and the servicing thereof is
contained within the Pooling and Servicing Agreement, the Purchase Agreement
and Prospectus filed herewith as exhibits.
Item 7. Financial Statements, Pro Forma Financial Information and Exhibits
EXHIBITS
<TABLE>
<CAPTION>
Designation Description Method of
Filing
- ----------- ------------ ----------------
<S> <C> <C>
Exhibit 4.1 Pooling and Servicing Agreement dated Filed with this
as of November 1, 1995, among Ford Report.
Motor Credit Company, as servicer,
Ford Credit Auto Receivables Corpor-
ation, as seller, and Chemcial Bank,
as trustee.
Exhibit 10.1 Purchase Agreement dated as of Filed with this
November 1, 1995 between Ford Motor Report.
Credit Company, as seller, and
Ford Credit Auto Receivables
Corporation, as purchaser.
Exhibit 99 Prospectus dated November 7, 1995, Incorporated by
relating to the sale of Ford Credit reference from
1995-B Grantor Trust 5.90% Asset the Company's
Backed Certificates, Class A. filing of such
Prospectus with
the Commission
pursuant to its
Rule 424(b)(1)
on November 9,
1995.
</TABLE>
<PAGE> 3
SIGNATURE
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 thereunto duly authorized on the date indicated.
Ford Credit 1995-B Grantor Trust
(Registrant)
Date: November 28, 1995 By:/s/R. P. Conrad
-----------------------------------
R. P. Conrad
Assistant Secretary of Ford Credit
Auto Receivables Corporation,
originator of Trust
<PAGE> 4
EXHIBIT INDEX
<TABLE>
<CAPTION>
Designation Description
- ----------- -----------
<S> <C>
Exhibit 4.1 Pooling and Servicing Agreement dated
as of November 1, 1995, among Ford
Motor Credit Company, as servicer,
Ford Credit Auto Receivables Corpor-
ation, as seller, and Chemcial Bank,
as trustee.
Exhibit 10.1 Purchase Agreement dated as of
November 1, 1995 between Ford Motor
Credit Company, as seller, and
Ford Credit Auto Receivables
Corporation, as purchaser.
Exhibit 99* Prospectus dated November 7 1995,
relating to the sale of Ford Credit
1995-B Grantor Trust 5.90% Asset
Backed Certificates, Class A.
</TABLE>
* Previously Filed
<PAGE> 1
EXHIBIT 4.1
______________________________
FORD CREDIT 1995-B GRANTOR TRUST
ASSET BACKED CERTIFICATES
______________________________
FORD CREDIT AUTO RECEIVABLES CORPORATION
Seller
FORD MOTOR CREDIT COMPANY
Servicer
CHEMICAL BANK
Trustee and Class A Agent
_________________
POOLING AND SERVICING AGREEMENT
Dated as of November 1, 1995
_________________
<PAGE> 2
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
----
<S> <C> <C>
ARTICLE I Creation of Trust . . . . . . . . . . . . . . . . . . . . . . . 2
ARTICLE II Conveyance of Receivables . . . . . . . . . . . . . . . . . . . 2
ARTICLE III Reserved . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
ARTICLE IV Acceptance by Trustee . . . . . . . . . . . . . . . . . . . . . 3
ARTICLE V Incorporation of Standard Terms
and Conditions of Agreement . . . . . . . . . . . . . . . 3
ARTICLE VI Special Definitions and Terms . . . . . . . . . . . . . . . . . 4
ARTICLE VII Additional Representations
and Warranties of the Seller . . . . . . . . . . . . . . . 6
ARTICLE VIII Ford Motor Credit Company Not
to Resign as Servicer . . . . . . . . . . . . . . . . . . 7
ARTICLE IX Agent for Service . . . . . . . . . . . . . . . . . . . . . . . 7
ARTICLE X Additional Covenants of the Seller . . . . . . . . . . . . . . 7
Schedule A -- List of Receivables
Schedule B -- Location of Receivables
</TABLE>
i
<PAGE> 3
This Pooling and Servicing Agreement, dated as of November 1,
1995, is made with respect to the formation of the Ford Credit 1995-B Grantor
Trust, among FORD CREDIT AUTO RECEIVABLES CORPORATION, a Delaware corporation,
as Seller ("Seller"), FORD MOTOR CREDIT COMPANY, a Delaware corporation, as
Servicer ("Servicer"), and Chemical Bank, a New York corporation, as trustee
(in such capacity, the "Trustee") and as agent (the "Class A Agent").
WITNESSETH THAT: In consideration of the premises and of the
mutual agreements herein contained, the parties hereto agree as follows:
ARTICLE I
Section 1.1 Creation of Trust. Upon the execution of this
Agreement by the parties hereto, there is hereby created the Ford Credit 1995-B
Grantor Trust.
ARTICLE II
Section 2.1 Conveyance of Receivables. In consideration of
the Trustee's delivery to, or upon the order of, the Seller of Certificates
("Certificates") in an aggregate amount equal to the Original Pool Balance, the
Seller does hereby irrevocably sell, transfer, assign, and otherwise convey to
the Trustee, in trust for the benefit of the Certificateholders, without
recourse (subject to the obligations herein) all right, title and interest of
the Seller, whether now owned or hereafter acquired, in and to the following:
(i) the Receivables listed in Schedule A
hereto and all monies paid thereon and due thereon on or after the
Cutoff Date (including any monies received prior to the Cutoff Date
that are due on or after the Cutoff Date and were not used to reduce
the principal balances of the Receivables);
(ii) the security interests in the Financed
Vehicles granted by Obligors pursuant to the Receivables;
2
<PAGE> 4
(iii) any proceeds from claims on any
physical damage, credit life, credit disability, or other insurance
policies covering Financed Vehicles or Obligors;
(iv) the Purchase Agreement, including the
right of the Seller to cause Ford Motor Credit Company to repurchase
Receivables from the Seller;
(v) Dealer Recourse;
(vi) rebates of premiums and other amounts
relating to insurance policies and other items financed under the
Receivables in effect as of the Cutoff Date; and
(vii) the proceeds of any and all of the
foregoing.
ARTICLE III
Reserved
ARTICLE IV
Section 4.1 Acceptance by Trustee. The Trustee does hereby
accept all consideration conveyed by the Seller pursuant to Section 2.1, and
declares that the Trustee shall hold such consideration upon the trusts herein
set forth for the benefit of all present and future Certificateholders, subject
to the terms and provisions of this Agreement.
ARTICLE V
Section 5.1 Incorporation of Standard Terms and Conditions of
Agreement. This Pooling and Servicing Agreement does hereby incorporate by
reference the Standard Terms and Conditions of Agreement for Ford Credit
Grantor Trusts dated as of November 1, 1995 ("Standard Terms and Conditions of
Agreement"), in the form attached hereto.
3
<PAGE> 5
ARTICLE VI
Section 6.1 Special Definitions and Terms. Whenever used in
the Standard Terms and Conditions of Agreement and in this Pooling and
Servicing Agreement, the following words and phrases shall have the following
meanings:
The "Class A Percentage" means 93.5%.
The "Class B Percentage" means 6.5%.
The "Corporate Trust Office" at the date hereof is located at
450 West 33rd Street - 15th Floor
New York, New York 10001
Attention: Corporate Trust Department
The "Cutoff Date" shall be November 1, 1995.
The first "Distribution Date" shall be December 15, 1995.
The "Optional Purchase Percentage" shall be 10%.
The "Original Pool Balance" is 1,750,016,370.06.
The "Pass-Through Rate" is 5.90% per annum.
The "Purchase Agreement" is the agreement dated as of November
1, 1995, relating to the purchase by the Seller from Ford Motor Credit Company
of the Receivables.
The "Required Deposit Rating" shall be a rating on (i)
short-term unsecured debt obligations of P-1 by Moody's Investors Service, Inc.
and (ii) short-term unsecured debt obligations of A-1+ by Standard & Poor's
Corporation; and any requirement that short-term unsecured debt obligations
have the "Required Deposit Rating" shall mean that such short-term unsecured
debt obligations have the foregoing required ratings from each of such rating
agencies.
The "Servicing Fee Rate" is 1.00% per annum.
4
<PAGE> 6
The "Specified Subordination Spread Account Balance" with
respect to any Distribution Date shall be $13,125,123; except that in the event
that on any Distribution Date (i) the annualized average for the preceding
three Collection Periods (or such shorter number of Collection Periods as have
elapsed since the Cutoff Date) of the ratios of net losses (i.e., the net
balances of all Receivables which are determined to be uncollectible in the
Collection Period, less any recoveries on Receivables charged off in the period
or prior periods) to the Pool Balance as of the first day of each such
Collection Period exceeds 2.25% or (ii) the average for the preceding three
Collection Periods (or such shorter number of Collection Periods as have
elapsed since the Cutoff Date) of the ratios of the number of Receivables that
have been repossessed but not yet sold or are delinquent 60 days or more to the
outstanding number of Receivables exceeds 1.50%, then the Specified
Subordination Spread Account Balance for such Distribution Date shall be an
amount equal to such percentage of the Pool Balance as of the opening of
business of the first day of such Collection Period as is determined by
deducting from eleven percent the following fraction, expressed as a
percentage: (x) 1 minus (y) a fraction, the numerator of which is the Class A
Certificate Balance and the denominator of which is the Pool Balance both as of
the opening of business of the first day of such Collection Period, but in no
event shall the Specified Subordination Spread Account Balance be more than
$78,750,737 or less than $13,125,123. On any Distribution Date on which the
aggregate balance of the Class A Certificates is $175,002,000 or less after
giving effect to distributions on such Distribution Date, the Specified
Subordination Spread Account Balance shall be the greater of the balance
described above or $30,625,287.
The "Subordination Initial Deposit" is
$2,625,025.
5
<PAGE> 7
ARTICLE VII
Section 7.1 Additional Representations and Warranties of the
Seller. The Seller does hereby make the following representations and
warranties on which the Trustee shall be deemed to have relied in accepting the
Receivables in trust and executing and authenticating the Certificates:
(i) New and Used Vehicles. Approximately
70.0% of the aggregate Principal Balance of the Receivables,
constituting 61.8% of the number of Receivables, as of the Cutoff
Date, represent vehicles financed at new vehicle rates, and the
remainder of the Receivables represent vehicles financed at used
vehicle rates;
(ii) Origination. Each Receivable shall
have an origination date on or after November 1, 1994;
(iii) Maturity of Receivables. Each
Receivable shall have an original maturity of not greater than 60
months;
(iv) Minimum Annual Percentage Rate. Each
Receivable shall have an Annual Percentage Rate equal to or greater
than 7.35%;
(v) Scheduled Payments. Each Receivable
shall have a first Scheduled Payment due on or prior to November 30,
1995 and no Receivable shall have a payment that is more than 30 days
overdue as of the Cutoff Date;
(vi) Location of Receivable Files. The
Receivable Files shall be kept at one or more of the locations listed
in Schedule B hereto;
(vii) No Extensions. The number of
Scheduled Payments shall not have been extended on any Receivable on
or before the Cutoff Date; and
6
<PAGE> 8
(viii) Rating Agencies. The rating agencies
rating the Certificates are Moody's Investors Service, Inc. and
Standard & Poor's Ratings Group.
ARTICLE VIII
Section 8.1 Ford Motor Credit Company Not to Resign as
Servicer. Subject to the provisions of Section 18.3 of the Standard Terms and
Conditions of Agreement, Ford Motor Credit Company shall not resign from the
obligations and duties hereby imposed on it as Servicer under this Agreement
except upon determination that the performance of its duties under this
Agreement shall no longer be permissible under applicable law. Notice of any
such determination permitting the resignation of Ford Motor Credit Company
shall be communicated to the Trustee at the earliest practicable time (and, if
such communication is not in writing, shall be confirmed in writing at the
earliest practicable time) and any such determination shall be evidenced by an
Opinion of Counsel to such effect delivered to the Trustee concurrently with or
promptly after such notice. No such resignation shall become effective until
the Trustee or a successor Servicer shall have taken the actions required by
the last paragraph of Section 19.1 of the Standard Terms and Conditions of
Agreement and shall have assumed the responsibilities and obligations of Ford
Motor Credit Company in accordance with Section 19.2 of the Standard Terms and
Conditions of Agreement.
ARTICLE IX
Section 9.1 Agent for Service. The agent for service for the
Seller and the Servicer shall be J.D. Bringard, Esq., Ford Motor Credit
Company, The American Road, Dearborn, Michigan 48121.
ARTICLE X
Section 10.1 Additional Covenants of the Seller.
(a) The Seller agrees with each nationally recognized
rating agency which has been requested by the
7
<PAGE> 9
Seller or an affiliate to rate the Class A Certificates issued pursuant to this
Agreement and which is then rating such Certificates that it shall not issue
any additional securities that could reasonably be expected to affect
materially and adversely the Certificates issued pursuant to this Agreement
unless it shall have first obtained written confirmation from such rating
agency that such issuance will not result in the qualification, downgrading or
withdrawal of the then current rating assigned to the Class A Certificates.
The Seller shall provide a copy of any such written confirmation to the
Trustee.
(b) The Seller shall not, without first receiving
written confirmation from each nationally recognized rating agency which has
been requested by the Seller or an affiliate to rate the Class A Certificates
and which is then rating such Certificates that the then current rating
assigned to the Class A Certificates will not result in the qualification,
downgrading or withdrawal of such rating, and, upon the Seller's receipt of
such written confirmation from each such rating agency, the Trustee shall,
without any exercise of its own discretion, provide its written consent to the
Seller, do any of the following:
(i) engage in any business or activity
other than those set forth in Article Third of the Seller's
Certificate of Incorporation, as amended;
(ii) incur any indebtedness, or assume or
guaranty any indebtedness of any other entity, other than (A) any
indebtedness incurred in connection with Notes (as defined in the
Seller's Certificate of Incorporation, as amended) and (B) any
indebtedness to Ford Motor Credit Company or any affiliate thereof
incurred in connection with the acquisition of receivables, which
indebtedness shall be subordinated to all other obligations of the
Seller;
(iii) dissolve or liquidate, in whole or in
part; consolidate or merge with or into any other entity or convey or
transfer its properties and assets substantially as an entirety to any
entity, unless:
8
<PAGE> 10
(A) the entity (if other than the
Seller) formed or surviving the consolidation or merger of which
acquires the properties and assets of the Seller is organized and
existing under the laws of the State of Delaware, expressly assumes
the due and punctual payment of, and all obligations of the Seller,
including those obligations of the Seller under this Agreement, and
has a Certificate of Incorporation containing provisions identical to
the provisions of Article Third, Article Fourth and Article Fifteen of
the Seller's Certificate of Incorporation, as amended; and
(B) immediately after giving effect to the
transaction, no default or event of default has occurred and is
continuing under any indebtedness of the Seller or any agreements
relating to such indebtedness; or
(iv) without the affirmative vote of 100%
of the members of the Board of Directors of the Seller, institute
proceedings to be adjudicated bankrupt or insolvent, or consent to the
institution of bankruptcy or insolvency proceedings against it, or
file a petition seeking or consent to reorganization or relief under
any applicable federal or state law relating to bankruptcy, or consent
to the appointment of a receiver, liquidator, assignee, trustee,
sequestrator (or other similar official) of the corporation or a
substantial part of its property, or make any assignment for the
benefit of creditors, or admit in writing its inability to pay its
debts generally as they become due, or take corporate action in
furtherance of any such action.
[The remainder of this page intentionally left blank.]
9
<PAGE> 11
IN WITNESS WHEREOF, the Seller, the Servicer, and the Trustee
have caused this Pooling and Servicing Agreement to be duly executed by their
respective officers as of the day and year first above written.
FORD CREDIT AUTO
RECEIVABLES CORPORATION
[SEAL]
ATTEST: By: /s/ Hurley D. Smith
----------------------------
TITLE: Secretary
/s/ T. W. Parkinson
- ---------------------------
TITLE:
FORD MOTOR CREDIT COMPANY
[SEAL]
ATTEST: By: /s/ Hurley D. Smith
----------------------------
TITLE: Secretary
/s/ Carol V. Rogoff
- --------------------------------
TITLE: Assistant Secretary
CHEMICAL BANK, as Trustee
ATTEST: By: /s/ Michael A. Smith
------------------------------
TITLE: Vice President
/s/ Francine Springer
- --------------------------------
TITLE: Trust Officer
<PAGE> 12
CHEMICAL BANK, as Class A Agent
Pursuant to Section 14.7
hereof
ATTEST: By: /s/ Michael A. Smith
-----------------------------
TITLE: Vice President
/s/ Francine Springer
- -------------------------------
TITLE: Trust Officer
<PAGE> 13
SCHEDULE A
LIST OF RECEIVABLES
DELIVERED TO TRUSTEE
AT CLOSING
<PAGE> 14
SCHEDULE B
LOCATION OF RECEIVABLES
Indianapolis
5875 Castle Creek Pkwy. North Drive
Suite 240
Indianapolis, IN 46250-4308
Detroit-North
580 Kirts Boulevard
Suite 300
Troy, MI 48084
Chicago-North
9700 Higgins Road
Suite 720
Rosemont, IL 60018
Ohio South
9797 Springboro Pike
Suite 302
Miamisburg, OH 45343
Detroit/West
One ParkLane Blvd.
Suite 405E
Dearborn, MI 48126
Chicago South
The Office of Waterfall Glen I
Suite 310
900 South Frontage Road
Woodridge, IL 60517
Grand Rapids
2851 Charlevoix Drive SE
Suite 300
Grand Rapids, MI 49546
Chicago - East
One River Place, Suite A
Lansing, IL 60438
<PAGE> 15
Akron
175 Montroes West Avenue
Suite 300 Crown Pointe
Copley, OH 44321
Louisville
502 Executive Park
Louisville, KY 40207
Milwaukee
10850 W. Park Place
Suite 110
Milwaukee, WI 53224
Chicago West
2500 W. Higgins Rd.
Suite 280
Hoffman Estates, IL 60195-2008
Saginaw
4901 Towne Centre Rd.
Suite 200
Saginaw, MI 48605
Findlay
3500 North Main Street
Findlay, OH 45840-1447
Cleveland
5700 Lombardo Centre
Suite 101
Seven Hills, OH 44131-2581
Philadelphia
Bay Colony Executive Park
575 E. Swedesford
Suite 100
Wayne, PA 19087
New Jersey South
5000 Dearborn Circle
Suite 200
Mt. Laurel, NJ 08054
Baltimore-West
1829 Reistertown Road
Baltimore, MD 21208-8861
B-2
<PAGE> 16
Long Island
972 Brush Hollow Road
5th Floor
Westbury, NY 11590-1740
Washington, D.C.
2440 Research Blvd.
Suite 150
Rockville, MD 20850-3293
New Haven
116 Washington Ave.
Floor #4
North Haven, CT 06473
Norfolk
Greenbrier Pointe
1401 Greenbrier Pkwy.
Suite 350
Chesapeake, VA 23320
New Jersey North
103 Eisenhower Parkway
4th Floor
Roseland, NJ 07068-1069
Pittsburgh
Foster Plaza 9
750 Holiday Drive
4th Floor, Suite 420
Pittsburgh, PA 15220-2783
Richmond
300 Arboretum Place
Suite 320
Richmond, VA 23236
Syracuse
5788 Widewaters Pkwy.
DeWitt, NY 13214
Westchester
660 White Plains Road
Tarrytown, NY 10591-0010
B-3
<PAGE> 17
Mobile
1201 Montlimar Dr.
Suite 700
Mobile, AL 36609
Birmingham
3535 Grandview Parkway
Suite 340
Birmingham, AL 35243
Orlando
2600 Lake Lucien Drive
Suite 306, The Forum Bldg.
Maitland, FL 32751
Memphis
6555 Quince Road
Suite 300
Memphis, TN 38119
Atlanta - North
North Park Town Center
1000 Abernathy Rd. N.E.
Bldg. 400, Suite 180
Atlanta, GA 30328
Greensboro
1500 Pinecroft Rd.
Suite 220
Greensboro, NC 27407
Charlotte
5832 Farm Pond Lane
Suite 200
Charlotte, NC 28212
Jacksonville
9485 Regency Square Boulevard
Jacksonville, FL 32225
Jackson
Highland Village Center
4500 I-55 North
Suite 292
Jackson, MS 39211
B-4
<PAGE> 18
Columbia
250 Berryhill Road
Suite 201
Columbia, SC 29210
Miami
6303 Blue Lagoon Drive
Suite 200
Miami, FL 33126
Dothan
3160 West Main Street
Suite 1
Dothan, AL 36301-1180
Nashville
565 Marriott Drive
Suite 190, Highland Ridge
Nashville, TN 37210
Raleigh
3651 Trust Drive
Raleigh, NC 27604
Tampa
Lincoln Pointe, Suite 800
2502 Rocky Point Drive
Tampa, FL 33607
Odessa
Ashford Park Office Center
Suite 201A
2626 John Ben Sheppard Parkway
Odessa, TX 79762
Lubbock
Suite 200
4010 82nd Street
Lubbock, TX 79424
Dallas
801 E. Campbell Road
Suite 600, Campbell Forum
Richardson, TX 75081
B-5
<PAGE> 19
Austin
1701 Directors Blvd.
Suite 320
Austin, TX 78744
Fort Worth
2350 W. Airport Hwy.
Suite 400, Center Park Tower
Bedford, TX 76022
Beaumont
2615 Calder
Suite 715
Beaumont, TX 77704
Houston-West
820 Gessner
Suite 700
Houston, TX 77024
Harlingen
1916 East Harrison
Harlingen, TX 78550
Corpus Christi
5350 South Staples
Suite 225
Corpus Christi, TX 78411
Little Rock
1701 Centerview Dr.
Suite 301
Little Rock, AR 72211
Amarillo
1616 S. Kentucky
Suite 130 Bldg. D
Amarillo, TX 79102
El Paso
1200 Golden Key Circle
Suite 104
El Paso, TX 79925
B-6
<PAGE> 20
Albuquerque
6100 Uptown Blvd., NE
Suite 300
Albuquerque, NM 87110
Houston-North
363 N. Sam Houston Pkwy. E.
Suite 700
Houston, TX 77060
San Antonio
1600 N.E. Loop 410
Suite 200
San Antonio, TX 78209
Tulsa
9820 East 41st St.
Suite 300
Tulsa, OK 74145
Minneapolis
11095 Viking Drive
Suite 308, One Southwest Crossing
Eden Prairie, MN 55344-7290
Wichita
7570 West 21st Street
Wichita, KS 67212
St. Louis
4227 Earth City Exp.
Suite 100
Earth City, MO 63045
Jefferson City
210 Prodo Drive
Jefferson City, MO 65109
Kansas City
8717 West 110th Street
Bldg. #14, Suite 550
Overland Park, KS 66210
B-7
<PAGE> 21
Des Moines
4200 Corporate Drive
Suite 107
West Des Moines, IA 50266
Omaha
10040 Regency Circle
Suite 100
Omaha, NE 68114-3786
Davenport
2535 Tech Drive
Suite 300, Commerce Exch. Bldg.
Bettendorf, IA 52722
Denver
6300 S. Syracuse Way
Suite 195
Englewood, CO 80111
Fargo
3100 13th Ave. South
Suite 304
Fargo, ND 58103
Springfield
3275 E. Ridgeview
Springfield, MO 65804-1816
Waterloo
211 E. San Marnan Dr.
Waterloo, IA 50702
San Bernadino
1615 Orange Tree Lane
Suite 215
Redlands, CA 92374
Salt Lake City
310 E. 4500 South
Suite 340
Murray, UT 84017
B-8
<PAGE> 22
Honolulu
1585 Kapiolani Blvd.
Suite 922, Ala Moano Pacific Center
Honolulu, HI 96814
Spokane
North 901 Monroe
Suite 350
Spokane, WA 99210-2148
Grand Junction
744 Horizon Ct.
Suite 330
Grand Junction, CO 81506
San Francisco
4301 Hacienda Dr.
Suite 400
Pleasanton, CA 94588
Portland
10220 S.W. Greenburg Rd.
Suite 415
Portland, OR 97223-5506
Sacramento
2720 Gateway Oaks Dr.
Suite 200
Sacramento, CA 95833
San Diego
3111 Camino Del Rio N.
Suite 1333
San Diego, CA 92108
Phoenix
4742 North 24th Street
Suite 215
Phoenix, AZ 85016
San Jose
1900 McCarthy Blvd.
Suite 400
Milpitas, CA 95035
B-9
<PAGE> 23
Seattle
13555 S.E. 36th Street
Suite 350
Bellevue, WA 98006
Orange
765 The City Drive
Suite 200
Orange, CA 92668
Anchorage
3201 C Street
Suite 203
Anchorage, AK 99503
Appleton
54 Park Place
Appleton, WI 54915-8861
South Bend
4215 Edison Lakes Parkway
Suite 140
Mishawaka, IN 46545
Columbus
655 Metro Place South
Suite 470, Metro V
Dublin, OH 43017-0792
Henderson
618 North Green Street
Henderson, KY 42420
Lansing
2140 University Park Drive
Okemos, MI 48864
Marshall
1408 North Michigan
Marshall, IL 62441
New Jersey-Central
101 Interchange Plaza
Cranbury, NJ 08512
B-10
<PAGE> 24
Huntington
3425 U.S. Route 60 East
Barboursville, WV 25504
Buffalo
95 John Muir Drive
Suite 102
Amherst, NY 14228
Manchester
4 Bedford Farms
Bedford, NH 03110
Harrisburg
4900 Ritter Road
Mechanicsburg, PA 17055
Boston South
Southboro Place, 2nd Floor
352 Turnpike Road
Southboro, MA 01772
Boston North
One Tech Drive, 3rd Floor
Andover, MA 01810-2497
Portland
2401 Congress Street
Portland, ME 04102
Albany
5 Pine West Plaza
Albany, NY 12205
Roanoke
5238 Valley Pointe Pkwy.
Roanoke, VA 24019
Falls Church
1420 Springhill Road
Suite 550
McLean, VA 22102
B-11
<PAGE> 25
Bristol
Landmark Center - Suite A
113 Landmark Lane
Bristol, TN 37620
Chattanooga
6025 Lee Highway
Suite 443
Chattanooga, TN 37421
Decatur
401 Lee Street
Suite 500
Decatur, AL 35602
Fayetteville
4317 Ramsey Street
Suite 300
Fayetteville, NC 28311
Athens
3708 Atlanta Highway
Athens, GA 30604
Knoxville
5500 Lonas Drive
Suite 260
Knoxville, TN 37909
Macon
5400 Riverside Drive
Suite 201
Macon, GA 31210
Pensacola
25 W. Cedar Street
Suite 316
Pensacola, Fl 32501
Savannah
6600 Abercorn Street
Suite 206
Savannah, GA 31405
B-12
<PAGE> 26
Tyler
821 East SE Loop 323
Suite 300
Tyler, TX 75701
Oklahoma City
4101 Perimeter Ctr Dr.
Suite 300, Perimeter Center
Oklahoma City, OK 73112-2304
Baltimore-East
Campbell Corporate Center One
4940 Campell Blvd., Suite 140
Whitemarsh Business Community
Baltimore, MD 21236
Billings
1643 Lewis Avenue
Suite 201
Billings, MT 59102
Cheyenne
6234 Yellowstone
Cheyenne, WY 82009
Cape Girardeau
2851 Independence
Cape Girardeau, MO 63701
Atlanta-South
1691 Phoenix Blvd.
Suite 300
Atlanta, GA 30349
Pasadena
800 East Colorado Blvd.
Suite 400
Pasadena, CA 91109
Colorado Springs
5575 Tech Center Dr.
Suite 220
Colorado Springs, CO 80919
B-13
<PAGE> 27
South Bay
301 E. Ocean Boulevard
Suite 1900
Long Beach, CA 90802
Ventura
260 Maple Court
Suite 210
Ventura, CA 93003
Las Vegas
3900 Paradise Road
Suite 239
Las Vegas, NV 89109
Eugene
1600 Valley River Drive
Suite 190
Eugene, OR 97401
Tupelo
One Mississippi Plaza
Tupelo, MS 38801
Charleston
4975 Lacross Road
Suite 150, Rivergate Center
North Charleston, SC 29418-6518
Western Carolina
215 Thompson Street
Hendersonville, NC 28739-2828
B-14
<PAGE> 28
New Orleans
3838 N. Causeway Blvd.
Suite 3000
Metairie, LA 70002
Lafayette
Saloom Office Park
Suite 350
100 Asma Boulevard
Lafayette, LA 70508
Shreveport
South Pointe Centre, Suite 200
3007 Knight Street
Shreveport, LA 71105
B-15
<PAGE> 29
FORD CREDIT AUTO RECEIVABLES CORPORATION
SELLER
FORD MOTOR CREDIT COMPANY
SERVICER
Standard Terms and Conditions of Agreement
Dated as of November 1, 1995
<PAGE> 30
TABLE OF CONTENTS
ARTICLES I-X
RESERVED
<TABLE>
<CAPTION>
ARTICLE XI
INTRODUCTION
Definitions
<S> <C> <C>
Section 11.1 Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . XI-1
Section 11.2 Usage of Terms . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . XI-16
Section 11.3 Cutoff Date and Record Date . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . XI-17
Section 11.4 Section References . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . XI-17
Section 11.5 Compliance Certificates and Opinions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . XI-17
ARTICLE XII
The Receivables
Section 12.1 Representations and Warranties of Seller . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . XII-1
Section 12.2 Repurchase Upon Breach . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . XII-5
Section 12.3 Custody of Receivable Files . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . XII-6
Section 12.4 Duties of Servicer as Custodian . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . XII-6
Section 12.5 Instructions; Authority to Act . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . XII-7
Section 12.6 Custodian's Indemnification . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . XII-7
Section 12.7 Effective Period and Termination . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . XII-8
ARTICLE XIII
Administration and Servicing of Receivables
Section 13.1 Duties of Servicer . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . XIII-1
Section 13.2 Collection of Receivable Payments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . XIII-2
Section 13.3 Realization Upon Receivables . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . XIII-2
Section 13.4 [Reserved] . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . XIII-2
Section 13.5 Maintenance of Security Interests in Financed Vehicles . . . . . . . . . . . . . . . . . . . . . . . . . . XIII-2
Section 13.6 Covenants of Servicer . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . XIII-3
Section 13.7 Purchase of Receivables Upon Breach . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . XIII-3
Section 13.8 Servicer Fee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . XIII-4
Section 13.9 Servicer's Certificate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . XIII-4
</TABLE>
i
<PAGE> 31
<TABLE>
<CAPTION>
Section Page
- ------- ----
<S> <C> <C>
Section 13.10 Annual Statement as to Compliance; Notice of Default . . . . . . . . . . . . . . . . . . . . . . . . . . XIII-5
Section 13.11 Annual Independent Certified Public Accountant's Report . . . . . . . . . . . . . . . . . . . . . . . . . XIII-5
Section 13.12 Access to Certain Documentation and Information Regarding Receivables . . . . . . . . . . . . . . . . . . XIII-6
Section 13.13 Servicer Expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . XIII-6
ARTICLE XIV
Distributions; Subordination Spread Account;
Statements to Certificateholders
Section 14.1 Accounts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . XIV-1
Section 14.2 Collections . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . XIV-3
Section 14.3 Application of Collections . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . XIV-4
Section 14.4 Advances . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . XIV-4
Section 14.5 Additional Deposits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . XIV-5
Section 14.6 Distributions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . XIV-5
Section 14.7 Subordination; Subordination Spread Account; Priority of Disibutions . . . . . . . . . . . . . . . . . . . XIV-10
Section 14.8 Net Deposits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . XIV-15
Section 14.9 Statements to Class A Certificateholders . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . XIV-15
ARTICLE XV
[Intentionally Omitted]
ARTICLE XVI
The Certificates
Section 16.1 The Certificates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . XVI-1
Section 16.2 Authentication of Certificates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . XVI-1
Section 16.3 Registration of Transfer and Exchange of Certificates . . . . . . . . . . . . . . . . . . . . . . . . . . XVI-2
Section 16.4 Mutilated, Destroyed, Lost, or Stolen Certificates . . . . . . . . . . . . . . . . . . . . . . . . . . . . XVI-4
Section 16.5 Persons Deemed Owners . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . XVI-4
Section 16.6 Access to List of Certificateholders' Names
</TABLE>
ii
<PAGE> 32
<TABLE>
<CAPTION>
Section Page
- ------- ----
<S> <C> <C>
and Addresses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . XVI-4
Section 16.7 Maintenance of Office or Agency . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . XVI-5
Section 16.8 Book-Entry Certificates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . XVI-5
Section 16.9 Notices to Clearing Agency . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . XVI-7
Section 16.10 Definitive Certificates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . XVI-7
ARTICLE XVII
The Seller
Section 17.1 Representations of Seller . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . XVII-1
Section 17.2 Liability of Seller; Indemnities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . XVII-3
Section 17.3 Merger or Consolidation of, or Assumption of the Obligations of, Seller . . . . . . . . . . . . . . . . . XVII-4
Section 17.4 Limitation on Liability of Seller and Others . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . XVII-4
Section 17.5 Seller May Own Certificates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . XVII-5
ARTICLE XVIII
The Servicer
Section 18.1 Representations of Servicer . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . XVIII-1
Section 18.2 Indemnities of Servicer . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . XVIII-3
Section 18.3 Merger or Consolidation of, or Assumption of the Obligations of, Servicer . . . . . . . . . . . . . . . XVIII-5
Section 18.4 Limitation on Liability of Servicer and Others . . . . . . . . . . . . . . . . . . . . . . . . . . . . . XVIII-5
Section 18.5 Delegation of Duties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . XVIII-6
ARTICLE XIX
Default
Section 19.1 Events of Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . XIX-1
Section 19.2 Appointment of Successor . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . XIX-3
Section 19.3 Repayment of Advances . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . XIX-4
Section 19.4 Notification to Certificateholders . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . XIX-4
Section 19.5 Waiver of Past Defaults . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . XIX-4
</TABLE>
iii
<PAGE> 33
<TABLE>
<CAPTION>
Section Page
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<S> <C> <C>
ARTICLE XX
The Trustee
-----------
Section 20.1 Duties of Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . XX-1
Section 20.2 Trustee's Certificate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . XX-4
Section 20.3 Trustee's Assignment of Purchased
Receivables . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . XX-4
Section 20.4 Certain Matters Affecting Trustee . . . . . . . . . . . . . . . . . . . . . . . XX-4
Section 20.5 Trustee Not Liable for Certificates
or Receivables . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . XX-7
Section 20.6 Trustee May Own Certificates . . . . . . . . . . . . . . . . . . . . . . . . . . XX-8
Section 20.7 Trustee's Fees and Expenses . . . . . . . . . . . . . . . . . . . . . . . . . . XX-8
Section 20.8 Indemnity of Trustee and
Class A Agent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . XX-9
Section 20.9 Eligibility Requirements for
Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . XX-10
Section 20.10 Resignation or Removal of
Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . XX-10
Section 20.11 Successor Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . XX-11
Section 20.12 Merger or Consolidation of Trustee . . . . . . . . . . . . . . . . . . . . . . . XX-12
Section 20.13 Appointment of Co-Trustee or
Separate Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . XX-12
Section 20.14 Representations and Warranties
of Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . XX-14
Section 20.15 Tax Returns. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . XX-15
Section 20.16 Trustee May Enforce Claims
Without Possession of
Certificates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . XX-15
Section 20.17 Suits for Enforcement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . XX-15
Section 20.18 Rights of Certificateholders to
Direct Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . XX-15
ARTICLE XXI
Termination
-----------
Section 21.1 Termination of the Trust . . . . . . . . . . . . . . . . . . . . . . . . . . . . XXI-1
Section 21.2 Optional Purchase of All Receivables . . . . . . . . . . . . . . . . . . . . . . XXI-2
</TABLE>
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<PAGE> 34
<TABLE>
<CAPTION>
Section Page
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<S> <C> <C>
ARTICLE XXII
Miscellaneous Provisions
------------------------
Section 22.1 Amendment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . XXII-1
Section 22.2 Protection of Title to Trust . . . . . . . . . . . . . . . . . . . . . . . . . . XXII-2
Section 22.3 Limitation on Rights of
Certificateholders . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . XXII-5
Section 22.4 Governing Law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . XXII-7
Section 22.5 Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . XXII-7
Section 22.6 Severability of Provisions . . . . . . . . . . . . . . . . . . . . . . . . . . . XXII-7
Section 22.7 Assignment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . XXII-8
Section 22.8 Certificates Nonassessable
and Fully Paid . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . XXII-8
Section 22.9 Further Assurances . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . XXII-8
Section 22.10 No Waiver; Cumulative Remedies . . . . . . . . . . . . . . . . . . . . . . . . . XXII-8
Section 22.11 Third-Party Beneficiaries . . . . . . . . . . . . . . . . . . . . . . . . . . . XXII-8
Section 22.12 Actions by Certificateholders . . . . . . . . . . . . . . . . . . . . . . . . . XXII-9
EXHIBITS
Exhibit A - Form of Class A Certificate
Exhibit B - Form of Class B Certificate
Exhibit C - Form of Depository Agreement
Exhibit D-1 - Form of Trustee's Certificate (assignment to Seller)
Exhibit D-2 - Form of Trustee's Certificate (assignment To Servicer)
</TABLE>
v
<PAGE> 35
FORD CREDIT GRANTOR TRUSTS
STANDARD TERMS AND CONDITIONS OF AGREEMENT
DATED AS OF NOVEMBER 1, 1995
INTRODUCTION
These Standard Terms and Conditions of Agreement shall be
applicable to Ford Credit Grantor Trusts formed on or after the date hereof,
with respect to which a Pooling and Servicing Agreement incorporating by
reference these Standard Terms and Conditions of Agreement shall have been
executed.
ARTICLE I THROUGH X RESERVED
ARTICLE XI
INTRODUCTION
Definitions
Section 11.1 Definitions. Whenever used in the Agreement
(including these Standard Terms and Conditions of Agreement), the following
words and phrases, unless the context otherwise requires, shall have the
following meanings:
"Advance" means the amount, as of the last day of a Collection
Period, which the Servicer is required to advance on the respective Receivable
pursuant to Section 14.4(a).
"Agreement" means the Pooling and Servicing Agreement executed
by the Seller, the Servicer and the Trustee as of the Cutoff Date, into which
these Standard Terms and Conditions of Agreement shall be incorporated by
reference, and all amendments and supplements thereto.
"Amount Financed" with respect to a Receivable means the
amount advanced under the Receivable toward the purchase price of the Financed
Vehicle and any related costs.
XI-1
<PAGE> 36
"Annual Percentage Rate" or "APR" of a Receivable means the
annual rate of finance charges stated in the Receivable.
"Available Interest" means, for any Distribution Date, the sum
of the following amounts with respect to the preceding Collection Period: (i)
that portion of all collections on Receivables allocable to interest (including
amounts withdrawn from the Payahead Account but excluding amounts deposited
into the Payahead Account, in each case to the extent allocable to interest),
(ii) Liquidation Proceeds to the extent allocable to interest due thereon in
accordance with the Servicer's customary servicing procedures, (iii) all
Advances made by the Servicer of interest due on Receivables and all amounts
advanced by the Servicer pursuant to Section 14.4(b), and (iv) the Purchase
Amount of each Receivable that became a Purchased Receivable during the related
Collection Period to the extent attributable to accrued interest thereon;
provided, however that in calculating the Available Interest the following will
be excluded: (i) amounts received on Receivables to the extent that the
Servicer has previously made an unreimbursed Advance of interest; and (ii)
Liquidation Proceeds with respect to a particular Receivable to the extent of
any unreimbursed Advances of interest.
"Available Principal" means, for any Distribution Date, the
sum of the following amounts with respect to the preceding Collection Period:
(i) that portion of all collections on Receivables allocable to principal
(including amounts withdrawn from the Payahead Account but excluding amounts
deposited into the Payahead Account, in each case to the extent allocable to
principal), (ii) Liquidation Proceeds attributable to principal in accordance
with the Servicer's customary servicing procedures, (iii) all Advances made by
the Servicer of principal due on the Receivables, (iv) to the extent
attributable to principal, the Purchase Amount of each Receivable that became a
Purchased Receivable during such Collection Period, and (v) partial prepayments
attributable to any refunded item included in the Amount Financed, such as
extended warranty protection plan costs, or physical damage, credit life,
disability insurance premiums, or any partial prepayment which causes a
reduction in the Obligor's periodic payment to below the
XI-2
<PAGE> 37
Scheduled Payment as of the Cutoff Date; provided, however, that in calculating
the Available Principal the following will be excluded: (i) amounts received
on Receivables to the extent that the Servicer has previously made an
unreimbursed Advance of principal; and (ii) Liquidation with respect to a
particular Receivable to the extent of any unreimbursed Advances of principal.
"Book-Entry Certificates" shall mean a beneficial interest in
the Class A Certificates, ownership and transfers of which shall be made
through book entries by a Clearing Agency as described in Section 16.8.
"Business Day" means any day other than a Saturday, a Sunday,
or a day on which banking institutions or trust companies in New York, New York
shall be authorized or obligated by law, executive order, or governmental
decree to remain closed.
"Certificate" means the Class A Certificate and the Class B
Certificate.
"Certificate Account" means the account designated as such,
established and maintained pursuant to Section 14.1.
"Certificateholder" or "Holder" means the Person in whose name
the respective Certificate shall be registered in the Certificate Register,
except that, solely for the purposes of giving any consent, waiver, request, or
demand pursuant to the Agreement, the interest evidenced by any Class A
Certificate registered in the name of the Seller, the Servicer, or any Person
controlling, controlled by, or under common con trol with the Seller or the
Servicer, shall not be taken into account in determining whether the requisite
percentage necessary to effect any such consent, waiver, request, or demand
shall have been obtained; provided, that the Trustee shall not be liable for
the inclusion in any such determination of any interest evidenced by any Class
A Certificate registered in the name of any Person controlling, controlled by,
or under common control with the Seller or the Servicer unless a Trust Officer
in the Corporate Trust Office with knowledge hereof and familiarity herewith
had actual knowledge that such Person so controlled, was controlled by, or was
under common con-
XI-3
<PAGE> 38
trol with, the Seller or the Servicer, as the case may be.
"Certificate Owner" shall mean, with respect to a Book-Entry
Certificate, the Person who is the owner of such Book-Entry Certificate, as
reflected on the books of the Clearing Agency, or on the books of a Person
maintaining an account with such Clearing Agency (directly or as an indirect
participant, in accordance with the rules of such Clearing Agency) and shall
mean, with respect to a Definitive Certificate, the Certificateholder.
"Certificate Register" and "Certificate Registrar" mean the
register maintained and the registrar appointed pursuant to Section 16.3.
"Class A Agent" shall have the meaning specified in Section
14.7.
"Class A Certificate" means any one of the Certificates
executed by the Trust and authenticated by the Trustee in substantially the
form set forth in Exhibit A hereto.
"Class A Certificate Balance" shall equal, initially, the
Class A Percentage of the Original Pool Balance and, thereafter, shall equal
the initial Class A Certificate Balance, reduced by all amounts distributed to
the Class A Certificateholders and allocable to principal.
"Class A Certificate Factor" means, as of a Distribution Date,
a seven-digit decimal figure equal to the Class A Certificate Balance as of the
close of business on such Distribution Date divided by the Class A Certificate
Balance as of the Cutoff Date.
"Class A Distributable Amount" means on any Distribution Date,
the sum of the Class A Principal Distributable Amount and the Class A Interest
Distributable Amount.
"Class A Interest Carryover Shortfall" means, as of the close
of any Distribution Date, the excess of the Class A Interest Distributable
Amount for such Distribution Date plus any outstanding Class A Interest
Carryover Shortfall from the preceding Distribution Date
XI-4
<PAGE> 39
plus interest on such outstanding Class A Interest Carryover Shortfall, to the
extent permitted by law, at the Pass-Through Rate from such preceding
Distribution Date through the current Distribution Date, over the amount of
interest that the holders of the Class A Certificates actually received on such
current Distribution Date.
"Class A Interest Distributable Amount" means, for any
Distribution Date, thirty (30) days of interest at the Pass-Through Rate on the
Class A Certificate Balance as of the close of business on the last day of the
preceding Collection Period.
"Class A Principal Carryover Shortfall" means, as of the close
of any Distribution Date, the excess of the Class A Principal Distributable
Amount plus any outstanding Class A Principal Carryover Shortfall from the
preceding Distribution Date over the amount of principal that the holders of
the Class A Certificates actually received on such current Distribution Date.
"Class A Principal Distributable Amount" means, with respect
to any Distribution Date, the sum of the Class A Percentage of: (i) the
principal portion of all Scheduled Payments due during the preceding Collection
Period; (ii) the principal portion of all prepayments in full received during
the preceding Collection Period (and certain partial prepayments relating to
rebates of extended warranty contract costs and insurance premiums or which
cause a reduction in the Obligor's periodic payment to below the Scheduled
Payment as of the Cutoff Date) (without duplication of amounts included in
clause (i) above); (iii) the Principal Balance of each Receivable that became a
Purchased Receivable under an obligation that arose during the preceding
Collection Period (without duplication of amounts referred to in clauses (i)
and (ii) above) and (iv) the Principal Balance of each Receivable liquidated by
the Servicer during the preceding Collection Period.
"Class B Certificate" means any one of the Certificates
executed by the Trust and authenticated by the Trustee in substantially the
form set forth in Exhibit B hereto.
"Class B Certificate Balance" shall equal, initially, the
Class B Percentage of the Original Pool
XI-5
<PAGE> 40
Balance and, thereafter, shall equal the initial Class B Certificate Balance,
reduced by all amounts distributed to Class B Certificateholders (or deposited
in the Subordination Spread Account not including the Subordination Initial
Deposit) and allocable to principal and by the Class A Principal Carryover
Shortfall and the Class B Principal Carryover Shortfall.
"Class B Distributable Amount" means, with respect to any
Distribution Date, the sum of the Class B Principal Distributable Amount and
the Class B Interest Distributable Amount.
"Class B Interest Carryover Shortfall" means, as of the close
of any Distribution Date, the excess of the Class B Interest Distributable
Amount plus any outstanding Class B Interest Carryover Shortfall on the
preceding Distribution Date over the amount of interest that the holders of the
Class B Certificates received (including amounts deposited in the Subordination
Spread Account) on such current Distribution Date.
"Class B Interest Distributable Amount" means, with respect to
any Distribution Date, thirty (30) days of interest at the Pass-Through Rate on
the Class B Certificate Balance as of the close of business on the last day of
the preceding Collection Period plus the excess, for each Receivable having an
APR greater than the sum of the Pass-Through Rate and the Servicing Fee Rate,
of the interest portion of the Scheduled Payment over the portion of such
interest equal to interest at the sum of the Pass-Through Rate and the
Servicing Fee Rate.
"Class B Principal Carryover Shortfall" means, as of the close
of any Distribution Date, the excess of the Class B Principal Distributable
Amount and any outstanding Class B Principal Carryover Shortfall on the
preceding Distribution Date over the amount of principal that the holders of
the Class B Certificates received (including amounts deposited in the
Subordination Spread Amount) on such current Distribution Date.
"Class B Principal Distributable Amount" means, with respect
to any Distribution Date, the sum of the Class B Percentage of: (i) the
principal portion of all Scheduled Payments due during the preceding Collection
XI-6
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Period, (ii) the principal portion of all prepayments in full received during
the preceding Collection Period (and certain partial prepayments relating to
rebates of extended warranty contract costs and insurance premiums or which
cause a reduction in the Obligor's periodic payment to below the Scheduled
Payment as of the Cutoff Date) (without duplication of amounts included in
clause (i) above), (iii) the Principal Balance of each Receivable that became a
Purchased Receivable under an obligation that arose during the preceding
Collection Period (without duplication of amounts included in clauses (i) and
(ii) above) and (iv) the Principal Balance of each Receivable liquidated by the
Servicer during the preceding Collection Period.
"Clearing Agency" shall mean an organization registered as a
"clearing agency" pursuant to Section 17A of the Securities Exchange Act of
1934, as amended.
"Clearing Agency Participant" shall mean a broker, dealer,
bank, other financial institution or other Person for whom from time to time a
Clearing Agency effects book-entry transfers and pledges of securities
deposited with the Clearing Agency.
"Collection Account" means the account designated as such,
established and maintained pursuant to Section 14.1.
"Collection Period" means a calendar month. Any amount stated
"as of the close of business of the last day of a Collection Period" shall give
effect to the following calculations as determined as of the end of the day on
such last day: 1) all applications of collections, 2) all current and previous
Payaheads, 3) all applications of Payahead Balances, 4) all Advances and
reductions of Outstanding Advances and 5) all distributions.
"Corporate Trust Office" means the office of the Trustee at
which its corporate trust business shall be administered, which office at the
date of the Agreement shall be specified therein.
"Cutoff Date" means the date specified as such in the
Agreement.
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"Dealer" means the dealer who sold a Financed Vehicle and who
originated and assigned the respective Receivable to Ford Motor Credit Company
under an existing agreement between such dealer and Ford Motor Credit Company.
"Dealer Recourse" means, with respect to a Receivable (i) any
amount paid by a Dealer or credited against a reserve established for, or held
on behalf of, a Dealer in excess of that portion of finance charges rebated to
the Obligor which is attributable to the Dealer's participation, if any, in the
Receivable, and (ii) all recourse rights against the Dealer which originated
the Receivable and any successor Dealer.
"Definitive Certificates" shall have the meaning specified in Section 16.8.
"Delivery" when used with respect to Subordination Spread
Account Property means:
(a) with respect to bankers' acceptances, commercial paper, negotiable
certificates of deposit and other obligations that constitute "instruments"
within the meaning of Section 9-105(1)(i) of the UCC and are susceptible of
physical delivery, transfer thereof to the Class A Agent by physical delivery
to the Class A Agent in the State of New York indorsed to, or registered in the
name of, the Class A Agent or indorsed in blank, and, with respect to "money"
as defined in Section 1-201(24) of the UCC, delivery thereof to the Class A
Agent in the State of New York, and with respect to a "certificated security"
(as defined in Section 8- 102(1)(a) of the UCC) transfer thereof (i) by
delivery of such certificated security indorsed to, or registered in the name
of, the Class A Agent or indorsed in blank to a financial intermediary (as
defined in Section 8-313(4) of the UCC) and the making by such financial
intermediary of entries on its books and records identifying such certificated
securities as belonging solely and exclusively to the Class A Agent (acting in
its capacity under Section 14.7) and the sending by such financial intermediary
of a confirmation to the Class A Agent of the purchase of such certificated
security by the Class A Agent, or (ii) by delivery thereof to a "clearing
corporation" (as defined in section 8- 102(3) of the UCC) either in bearer
form, in registered form registered to the clearing corporation or
XI-8
<PAGE> 43
to a "custodian bank" (as defined in Section 8-102(4) of the UCC) or a nominee
of either of them subject to the clearing corporations exclusive control and
the making by such clearing corporation of appropriate entries on its books
reducing the appropriate securities account of the transferor and increasing
the appropriate securities account of a financial intermediary by the amount of
such certificated security, the identification by the clearing corporation of
the certificated securities for the sole and exclusive account of the financial
intermediary, the maintenance in the State of New York of such certificated
securities by such clearing corporation or a "custodian bank" (as defined in
Section 8-102(4) of the UCC) or the nominee of either subject to the clearing
corporation's exclusive control, the indorsement thereof to the clearing
corporation or such custodian bank or a nominee of either of them subject to
the clearing corporation's exclusive control, the sending of a confirmation to
the Class A Agent by the financial intermediary of the purchase by the Class A
Agent of such securities and the making by such financial intermediary of
entries on its books and records identifying such certificated securities as
belonging solely and exclusively to the Class A Agent (acting in its capacity
under Section 14.7) (all of the foregoing, "Physical Property"), and, in any
event, any such Physical Property in registered form shall be in the name of
the Class A Agent or its nominee; and such additional or alternative procedures
as may hereafter become appropriate to effect the complete transfer of
ownership of any such Subordination Spread Account Property to the Class A
Agent (as defined herein), consistent with changes in applicable law or
regulations or the interpretation thereof; and
(b) with respect to any securities issued by the
U.S. Treasury, the Federal Home Loan Mortgage Corporation or by the Federal
National Mortgage Association that is a book-entry security held through the
Federal Reserve System pursuant to Federal book-entry regulations, the
following procedures, all in accordance with applicable law, including
applicable federal regulations and Articles 8 and 9 of the UCC: book-entry
registration of such property to an appropriate book-entry account maintained
with a Federal Reserve Bank by a financial intermediary which is also a
"depositary" pursuant to applicable federal regulations and issuance by such
financial intermediary of a deposit advice or
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other written confirmation of such book-entry registration to the Class A Agent
of the purchase by the Class A Agent of such book-entry securities; the making
by such financial intermediary of entries in its books and records identifying
such book-entry security held through the Federal Reserve System pursuant to
Federal book-entry regulations as belonging solely and exclusively to the Class
A Agent acting in its capacity under Section 14.7 and indicating that such
custodian holds such Subordination Spread Account Property solely as agent for
the Class A Agent; and such additional or alternative procedures as may
hereafter become appropriate to effect complete transfer of ownership of any
such Subordination Spread Account Property to the Class A Agent, consistent
with changes in applicable law or regulations or the interpretation thereof.
"Depository Agreement" means the agreement among the Seller,
the Trustee, and the initial Clearing Agency, dated as of the date of the
Agreement, substantially in the form attached hereto as Exhibit C.
"Determination Date" means the eighth Business Day but not
later than the 10th day of each calendar month. "Distribution Date" means,
for each Collection Period, the 15th day of the following month, or if the
15th day is not a Business Day, the next following Business Day, commencing
with the date specified in the Agreement.
"Event of Default" means an event specified in Section 19.1.
"Financed Vehicle" means a new or used automobile or light
truck, together with all accessions thereto, securing an Obligor's indebtedness
under the respective Receivable.
"Lien" means a security interest, lien, charge, pledge,
equity, or encumbrance of any kind other than tax liens, mechanics' liens, and
any liens which attach to the respective Receivable by operation of law.
"Liquidated Receivable" means a Receivable which, by its
terms, is in default and as to which the Servicer has determined, in accordance
with its customary
XI-10
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servicing procedures, that eventual payment in full is unlikely or has
repossessed and disposed of the Financed Vehicle.
"Liquidation Proceeds" means the monies collected from
whatever source, during the respective Collection Period, on a Liquidated
Receivable, net of the sum of any amounts expended by the Servicer for the
account of the Obligor plus any amounts required by law to be remitted to the
Obligor.
"Monthly Remittance Condition" has the meaning assigned to
such term in Section 14.1(b) hereof.
"Obligor" on a Receivable means the purchaser or co-purchasers
of the Financed Vehicle or any other Person who owes payments under the
Receivable (not including any Dealer in respect of Dealer Recourse).
"Officer's Certificate" means a certificate signed by the
chairman of the board, the president, any executive vice president, any vice
president, the treasurer, any assistant treasurer, or the controller of the
Seller or the Servicer, as appropriate.
"Opinion of Counsel" means a written opinion of counsel who
may but need not be counsel to the Seller or Servicer, which counsel shall be
acceptable to the Trustee.
"Optional Purchase Percentage" means the percentage specified
in the Agreement.
"Original Pool Balance" means the Pool Balance as of the
Cutoff Date, as specified in the Agreement.
"Outstanding Advances" on a Receivable means the sum, as of
the close of business on the last day of a Collection Period, of all Advances
as reduced by payments as specified in Section 14.4(a) with respect to such
Receivable.
"Pass-Through Rate" means the interest rate payable to
Certificateholders, as specified in the Agreement.
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<PAGE> 46
"Payahead" on a Receivable means the amount, as of the close
of business on the last day of a Collection Period, specified in Section 14.3
with respect to such Receivable.
"Payahead Account" means the account designated as such,
established and maintained pursuant to Section 14.1.
"Payahead Balance" on a Receivable means the sum, as of the
close of business on the last day of a Collection Period, of all Payaheads made
by or on behalf of the Obligor with respect to such Receivable (including any
amount paid by or on behalf of the Obligor prior to the Cutoff Date that is due
on or after the Cutoff Date and was not used to reduce the principal balance of
such Receivable), as reduced by applications of previous Payaheads with respect
to such Receivable, pursuant to Sections 14.3 and 14.4.
"Person" means any individual, corporation, estate,
partnership, joint venture, association, joint stock company, trust,
unincorporated organization, or government or any agency or political
subdivision thereof.
"Physical Property" has the meaning assigned to such term in
the definition of the term "Delivery" in this Section 11.1.
"Pool Balance" as of the close of business of the last day of
a Collection Period means the aggregate Principal Balance of the Receivables
(excluding Purchased Receivables and Liquidated Receivables); provided, that
where the Pool Balance is relevant in determining whether the requisite
percentage of Class A Certificateholders necessary to effect any consent,
waiver, request, or demand shall have been obtained, the Pool Balance shall be
deemed to be reduced by the amount equal to the Pool Balance (without giving
effect to this provision) represented by the interests evidenced by any Class A
Certificate registered in the name of the Seller, the Servicer, or any Person
controlling, controlled by, or under common control with the Seller or the
Servicer.
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<PAGE> 47
"Pool Factor" as of the last day of a Collection Period means
a seven-digit decimal figure equal to the Pool Balance divided by the Original
Pool Balance.
"Principal Balance" of a Receivable, as of the close of
business on the last day of a Collection Period, means the Amount Financed
minus the sum of (a) that portion of all Scheduled Payments due on or prior to
such day allocable to principal using the actuarial or constant yield method,
(b) any refunded portion of extended warranty protection plan costs, or of
physical damage, credit life, or disability insurance premiums included in the
Amount Financed, (c) any payment of the Purchase Amount with respect to the
Receivable allocable to principal and (d) any prepayment in full or any partial
prepayments applied to reduce the principal balance of the Receivable.
"Program" has the meaning assigned to such term in Section
13.11 hereof.
"Purchase Amount" means the amount, as of the close of
business on the last day of a Collection Period, required to be paid by an
Obligor to prepay in full the respective Receivable under the terms thereof
(which amount shall include a full month's interest, in the month of payment,
at the Annual Percentage Rate).
"Purchased Receivable" means a Receivable purchased as of the
close of business on the last day of respective Collection Period by the
Servicer pursuant to Section 13.7 or by the Seller pursuant to Section 12.2.
"Realized Losses" means, the excess of the Principal Balance
of any Liquidated Receivable (as reduced by any Payaheads) over Liquidation
Proceeds to the extent allocable to principal received in the Collection
Period.
"Receivable" means any retail installment sale contract which
shall appear on Schedule A to the Agreement (which Schedule A may be in the
form of microfiche) and any amendments, modifications or supplements to such
retail installment sale contract which has not been released by the Trustee
from the Trust.
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"Receivable Files" means the documents specified in
Section 12.3.
"Record Date" means the fourteenth day of the current calendar
month; provided, however, that if Definitive Certificates are issued pursuant
to Section 16.10 hereof, subsequent to the issuance of such Definitive
Certificates the Record Date for any Distribution Date shall be the last day of
the Collection Period immediately preceding the month in which such
Distribution Date occurs.
"Required Deposit Rating" means the rating specified in the
Agreement.
"Residual Certificate" has the meaning assigned to such term
in Section 16.1 hereof.
"Scheduled Payment" on a Receivable means that portion of the
payment required to be made by the Obligor during the respective Collection
Period sufficient to amortize the Principal Balance under the actuarial method
over the term of the Receivable and to provide interest at the APR.
"Seller" means Ford Credit Auto Receivables Corporation as the
seller of the Receivables under the Agreement, and each successor to Ford
Credit Auto Receivables Corporation (in the same capacity) pursuant to Section
17.3.
"Servicer" means Ford Motor Credit Company as the servicer of
the Receivables, and each successor to Ford Motor Credit Company (in the same
capacity) pursuant to Section 18.3 or 19.2.
"Servicer Fees" means the sum of the Servicing Fee and the
Supplemental Servicing Fee.
"Servicer's Certificate" means a certificate completed and
executed by the Servicer by any executive vice president, any vice president,
the treasurer, any assistant treasurer, the controller, or any assistant
controller of the Servicer pursuant to Section 13.9.
"Servicing Fee" means, with respect to a Collection Period,
the fee payable to the Servicer for
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<PAGE> 49
services rendered during the respective Collection Period, which shall be equal
to one-twelfth of the Servicing Fee Rate multiplied by the Pool Balance as of
the first day of the Collection Period.
"Servicing Fee Rate" means the percentage set forth in the
Agreement.
"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.
"Simple Interest Receivable" means any Receivable under which
the portion of a payment allocable to interest and the portion allocable to
principal is determined in accordance with the Simple Interest Method.
"State" means any state or commonwealth of the United States
of America, or the District of Columbia.
"Subordination Initial Deposit" means the amounts, if any,
deposited into the Subordination Spread Account on the date of initial issuance
of the Certificates pursuant to Section 14.7 and specified in the Agreement.
"Subordination Spread Account" means the account established
and maintained pursuant to Section 14.7.
"Subordination Spread Account Property" has the meaning
specified in Section 14.7(a)(ii).
"Supplemental Servicing Fee" means the fee payable to the
Servicer for certain services rendered during the respective Collection Period,
determined pursuant to and defined in Section 13.8.
"Total Available Amount" shall mean, for each Distribution
Date, the sum of the Available Interest and the Available Principal.
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<PAGE> 50
"Trust" means the trust created by the Agreement, the estate
of which shall consist of the Receivables (other than Purchased Receivables)
and all monies paid thereon other than amounts deposited or to be deposited in
the Payahead Account, and all monies due thereon, on or after the Cutoff Date;
security interests in the Financed Vehicles; funds deposited in the Collection
Account and the Certificate Account and proceeds thereof; any property
(including the right to receive Liquidation Proceeds) that shall have secured a
Receivable and that shall have been acquired by or on behalf of the Trustee;
proceeds from claims on any physical damage, credit life, or disability
insurance policies covering Financed Vehicles or Obligors; any Dealer Recourse;
all right, title and interest of the Seller in and to the Purchase Agreement;
and the proceeds of any and all of the foregoing.
"Trustee" means the Person acting as Trustee under the
Agreement, its successor in interest, and any successor trustee pursuant to
Section 20.11.
"Trustee Officer" means the chairman or vice-chairman of the
board of directors, the chairman or vice-chairman of the executive committee of
the board of directors, the president, any vice president, the secretary, any
assistant secretary, the treasurer, any assistant treasurer, the cashier, any
assistant cashier, any trust officer or assistant trust officer, the controller
and any assistant controller, or any other officer of the Trustee customarily
performing functions similar to those performed by any of the above designated
officers and also means, with respect to a particular corporate trust matter,
any other officer to whom such matter is referred because of his knowledge of
and familiarity with the particular subject.
"Trustee's Certificate" means a certificate completed and
executed by the Trustee by a Trustee Officer pursuant to Section 20.2,
substantially in the form of, in the case of assignment to the Seller, Exhibit
D-1 and in the case of an assignment to the Servicer, Exhibit D-2.
"UCC" means the Uniform Commercial Code as in effect in the
respective jurisdiction.
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<PAGE> 51
Section 11.2 Usage of Terms. With respect to all terms in
the Agreement, the singular includes the plural and the plural the singular;
words importing any gender include the other genders; references to "writing"
include printing, typing, lithography, and other means of reproducing words in
a visible form; references to agreements and other contractual instruments
include all subsequent amendments thereto or changes therein entered into in
accordance with their respective terms and not prohibited by the Agreement;
references to Persons include their permitted successors and assigns; and the
term "including" means "including without limitation."
Section 11.3 Cutoff Date and Record Date. All references
to the Record Date prior to the first Record Date in the life of the Trust
shall be to the Cutoff Date.
Section 11.4 Section References. All section references
shall be to Sections in these Standard Terms and Conditions of Agreement.
Section 11.5 Compliance Certificates and Opinions. Upon
any application or request by the Seller or the Servicer to the Trustee to
take any action under any provision herein, the Seller or the Servicer (as the
case may be) shall furnish to the Trustee an Officer's Certificate stating that
all conditions precedent, if any, provided for herein relating to the proposed
action have been complied with and an Opinion of Counsel stating that in the
opinion of such counsel all such conditions precedent, if any, have been
complied with, 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 Agreement relating to such particular application or request,
no additional certificate or opinion need be furnished.
Every certificate or opinion with respect to compliance with a
condition or covenant provided herein shall include:
(1) a statement that each individual signing such
certificate or opinion has read such covenant or condition and the
definitions herein relating thereto;
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<PAGE> 52
(2) a brief statement as to the nature and scope of
the examination or investigation upon which the statements or opinions
contained in such certificate or opinion are based;
(3) a statement that, in the opinion of each such
individual, he has made such examination or investigation as is
necessary to enable him to express an informed opinion as to whether or
not such covenant or condition has been complied with; and
(4) a statement as to whether or not, in the opinion
of each such individual, such condition or covenant has been complied
with.
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ARTICLE XII
The Receivables
Section 12.1 Representations and Warranties of Seller. The
Seller makes the following representations and warranties as to the Receivables
on which the Trustee relies in accepting the Receivables in trust and executing
and authenticating the Certificates. Such representations and warranties
speak as of the execution and delivery of the Agreement, but shall survive the
sale, transfer, and assignment of the Receivables to the Trustee and, if
applicable, any subsequent assignment or transfer pursuant to Article XV:
(i) Characteristics of Receivables. Each Receivable (a)
shall have been originated in the United States of America by a Dealer
for the retail sale of a Financed Vehicle in the ordinary course of
such Dealer's business, shall have been fully and properly executed by
the parties thereto, shall have been purchased by the Seller from Ford
Motor Credit Company, which in turn shall have purchased such
Receivable from such Dealer under an existing dealer agreement with
Ford Motor Credit Company, and shall have been validly assigned by
such Dealer to Ford Motor Credit Company, which in turn shall have
been validly assigned by Ford Motor Credit Company to the Seller in
accordance with its terms, (b) shall have created or shall create a
valid, subsisting, and enforceable first priority security interest in
favor of Ford Motor Credit Company in the Financed Vehicle, which
security interest has been assigned by Ford Motor Credit Company to
the Seller, which in turn shall be assignable by the Seller to the
Trustee, (c) shall contain customary and enforceable provisions such
that the rights and remedies of the holder thereof shall be adequate
for realization against the collateral of the benefits of the
security, (d) shall provide for level monthly payments (provided that
the payment in the first or last month in the life of the Receivable
may be minimally different from the
XII-1
<PAGE> 54
level payment) that fully amortize the Amount Financed by maturity and
yield interest at the Annual Percentage Rate, and (e) shall provide
for, in the event that such contract is prepaid, a prepayment that
fully pays the Principal Balance.
(ii) Schedule of Receivables. The information set forth in
Schedule A to the Agreement shall be true and correct in all material
respects as of the opening of business on the Cutoff Date, and no
selection procedures believed to be adverse to the Certificateholders
shall have been utilized in selecting the Receivables.
(iii) Compliance with Law. Each Receivable and the sale of
the Financed Vehicle shall have complied at the time it was originated
or made and at the execution of the Agreement shall comply in all
material respects with all requirements of applicable federal, State,
and local laws, and regulations thereunder, including, without
limitation, usury laws, the Federal Truth-in-Lending Act, the Equal
Credit Opportunity Act, the Fair Credit Reporting Act, the Fair Debt
Collection Practices Act, the Federal Trade Commission Act, the
Magnuson-Moss Warranty Act, the Federal Reserve Board's Regulations B
and Z, and State adaptations of the National Consumer Act and of the
Uniform Consumer Credit Code, and other consumer credit laws and equal
credit opportunity and disclosure laws.
(iv) Binding Obligation. Each Receivable shall represent
the genuine, legal, valid, and binding payment obligation in writing
of the Obligor, enforceable by the holder thereof in accordance with
its terms subject to the effect of bankruptcy, insolvency,
reorganization, or other similar laws affecting the enforcement of
creditors' rights generally.
(v) No Government Obligor. None of the Receivables shall
be due from the United States of America or any State or from
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<PAGE> 55
any agency, department, or instrumentality of the United States of
America or any State.
(vi) Security Interest in Financed Vehicle. Immediately
prior to the sale, assignment, and transfer thereof, each Receivable
shall be secured by a validly perfected first security interest in the
Financed Vehicle in favor of Ford Motor Credit Company as secured party
or all necessary and appropriate actions shall have been commenced that
would result in the valid perfection of a first security interest in
the Financed Vehicle in favor of Ford Motor Credit Company as secured
party.
(vii) Receivables in Force. No Receivable shall have been
satisfied, subordinated, or rescinded, nor shall any Financed Vehicle
have been released from the lien granted by the related Receivable in
whole or in part.
(viii) No Waiver. No provision of a Receivable shall have
been waived.
(ix) No Defenses. No right of rescission, setoff,
counterclaim, or defense shall have been asserted or threatened with
respect to any Receivable.
(x) No Liens. To the best of the Seller's knowledge, no
liens or claims shall have been filed for work, labor, or materials
relating to a Financed Vehicle that shall be liens prior to, or equal
or coordinate with, the security interest in the Financed Vehicle
granted by the Receivable.
(xi) No Default. Except for payment defaults continuing for
a period of not more than thirty days as of the Cutoff Date, no
default, breach, violation, or event permitting acceleration under the
terms of any Receivable shall have occurred; and no continuing
condition that with notice or the lapse of time would constitute a
default, breach, violation, or event permitting acceleration under the
XII-3
<PAGE> 56
terms of any Receivable shall have arisen; and the Seller shall not
waive any of the foregoing.
(xii) Insurance. Ford Motor Credit Company, in accordance
with its customary procedures, shall have determined that the Obligor
has obtained or agreed to obtain physical damage insurance covering
the Financed Vehicle.
(xiii) Title. It is the intention of the Seller that the
transfer and assignment herein contemplated constitute a sale of the
Receivables from the Seller to the Trust and that the beneficial
interest in and title to the Receivables not be part of the Seller's
estate in the event of the filing of a bankruptcy petition by or
against the Seller under any bankruptcy law. No Receivable has been
sold, transferred, assigned, or pledged by the Seller to any Person
other than the Trustee. Immediately prior to the transfer and
assignment herein contemplated, the Seller had good and marketable
title to each Receivable free and clear of all Liens, encumbrances,
security interests, and rights of others and, immediately upon the
transfer thereof, the Trustee for the benefit of the Certificateholders
shall have good and marketable title to each Receivable, free and clear
of all Liens, encumbrances, security interests, and rights of others;
and the transfer has been perfected under the UCC.
(xiv) Valid Assignment. No Receivable shall have been
originated in, or shall be subject to the laws of, any jurisdiction
under which the sale, transfer, and assignment of such Receivable under
the Agreement or pursuant to transfers of the Certificates shall be
unlawful, void, or voidable. The Seller has not entered into any
agreement with any account debtor that prohibits, restricts or
conditions the assignment of any portion of the Receivables.
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(xv) All Filings Made. All filings (including, without
limitation, UCC filings) necessary in any jurisdiction to give the
Trustee a first perfected ownership interest in the Receivables shall
have been made.
(xvi) Chattel Paper. Each Receivable constitutes "chattel
paper" as defined in the UCC.
(xvii) No Simple Interest Receivables. None of the
Receivables are Simple Interest Receivables.
(xviii) One Original. There shall be only one original
executed copy of each Receivable.
(xix) Agreement. The representations and warranties in
the Agreement shall be true.
Section 12.2 Repurchase Upon Breach. The Seller, the Servicer, or
the Trustee, as the case may be, shall inform the other parties to the
Agreement and Ford Motor Credit Company promptly, in writing, upon the
discovery of any breach of the Seller's representations and warranties pursuant
to Section 12.1. Unless the breach shall have been cured by the last day of
the second Collection Period following the discovery, the Trustee shall enforce
the obligation of the Seller under the Purchase Agreement, and, if necessary,
the Seller shall enforce the obligation of Ford Motor Credit Company under the
Purchase Agreement, to repurchase any Receivable materially and adversely
affected by the breach as of such last day (or, at the Seller's option, the
last day of the first Collection Period following the discovery). In
consideration of the purchase of the Receivable, the Seller shall remit the
Purchase Amount, in the manner specified in Section 14.5. The sole remedy of
the Trustee, the Trust, or the Certificateholders with respect to a breach of
the Seller's representations and warranties pursuant to Section 12.1 shall be
to require the Seller to repurchase Receivables pursuant to this Section 12.2
or to enforce the obligation of Ford Motor Credit Company to the Seller to
repurchase such Receivables pursuant to the Purchase Agreement.
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Section 12.3 Custody of Receivable Files. To assure uniform
quality in servicing the Receivables and to reduce administrative costs,
the Trustee, upon the execution and delivery of the Agreement, hereby revocably
appoints the Servicer, and the Servicer hereby accepts such appointment, to act
as the agent of the Trustee as custodian of the following documents or
instruments which are hereby constructively delivered to the Trustee with
respect to each Receivable:
(i) The original of the Receivable.
(ii) The original credit application fully executed
by the Obligor or a photocopy thereof.
(iii) The original certificate of title or such
documents that the Servicer or Ford Motor Credit Company shall keep on
file, in accordance with its customary procedures, evidencing the
security interest of Ford Motor Credit Company in the Financed Vehicle.
(iv) Any and all other documents that the Servicer
or the Seller shall keep on file, in accordance with its customary
procedures, relating to a Receivable, an Obligor, or a Financed Vehicle.
The Servicer shall provide an Officer's Certificate to the
Trustee confirming that the Servicer has received on behalf of the Trustee all
the documents and instruments necessary for the Servicer to act as the agent of
the Trustee for the purposes set forth in this Section, including the documents
referred to herein, and the Trustee is hereby authorized to rely on such
Officer's Certificate.
Section 12.4 Duties of Servicer as Custodian.
(a) Safekeeping. The Servicer shall hold the
Receivable Files on behalf of the Trustee for the use and benefit of
all present and future Certificateholders, and maintain such accurate and
complete accounts, re-
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cords, and computer systems pertaining to each Receivable File as shall enable
the Trustee to comply with these Standard Terms and Conditions of Agreement.
In performing its duties as custodian the Servicer shall act with reasonable
care, using that degree of skill and attention that the Servicer exercises with
respect to the receivable files relating to all comparable automotive
receivables that the Servicer services for itself or others. In accordance
with its customary practices with respect to its retail installment sale
contracts, the Servicer shall conduct, or cause to be conducted, periodic
audits of the Receivable Files held by it under the Agreement, and of the
related accounts, records, and computer systems, in such a manner as shall
enable the Trustee to verify the accuracy of the Servicer's record keeping.
The Servicer shall promptly report to the Trustee any 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. Nothing herein shall be deemed to require an initial review or
any periodic review by the Trustee of the Receivable Files.
(b) Maintenance of and Access to Records. The
Servicer shall maintain each Receivable File at one of its offices
specified in Schedule B to the Agreement, or at such other office as shall be
specified to the Trustee by written notice not later than 90 days after any
change in location. The Servicer shall make available to the Trustee or its
duly authorized representatives, attorneys, or auditors a list of locations of
the Receivable Files, the Receivable Files, and the related accounts, records,
and computer systems maintained by the Servicer at such times as the Trustee
shall instruct.
Section 12.5 Instructions; Authority to Act. All
instructions from the Trustee shall be in writing and signed by a Trust
Officer, and the Servicer shall be deemed to have received proper instructions
with respect to the Receivable Files upon its receipt of such written
instructions.
Section 12.6 Custodian's Indemnification. The Servicer as
custodian shall indemnify the Trustee for any and all liabilities,
obligations, losses, compensatory damages, payments, costs, or expenses of any
kind whatsoever that may be imposed on, incurred, or asserted
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against the Trustee as the result of any improper act or omission in any way
relating to the maintenance and custody by the Servicer as custodian of the
Receivable Files; provided, however, that the Servicer shall not be liable for
any portion of any such amount resulting from the willful misfeasance, bad
faith, or negligence of the Trustee.
Section 12.7 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 12.7. If Ford Motor Credit Company shall resign as
Servicer in accordance with the provisions of the Agreement or if all of the
rights and obligations of the Servicer shall have been terminated under Section
19.1, the appointment of the Servicer as custodian shall be terminated by the
Trustee, or by the Holders of Class A Certificates evidencing not less than 25%
of the Class A Certificate Balance, in the same manner as the Trustee or such
Holders may terminate the rights and obligations of the Servicer under Section
19.1. As soon as practicable after any termination of such appointment, the
Servicer shall deliver the Receivable Files and the related accounts and
records maintained by the Servicer to the Trustee or the Trustee's agent at
such place or places as the Trustee may reasonably designate.
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ARTICLE XIII
Administration and Servicing of Receivables
Section 13.1 Duties of Servicer. Servicer shall
manage, service, administer, and make collections on the Receivables
with reasonable care, using that degree of skill and attention that
the Servicer exercises with respect to all comparable receivables that it
services for itself or others. The Servicer's duties shall include collection
and posting of all payments, responding to inquiries of Obligors on such
Receivables, investigating delinquencies, sending payment coupons to Obligors,
reporting tax information to Obligors, accounting for collections, furnishing
monthly and annual statements to the Trustee with respect to distributions, and
making Advances pursuant to Section 14.4. The Servicer shall follow its
customary standards, policies, and procedures in performing its duties as
Servicer. Without limiting the generality of the foregoing, the Servicer is
authorized and empowered by the Trustee to execute and deliver, on behalf of
itself, the Trust, the Certificateholders, or the Trustee or any of them, any
and all instruments of satisfaction or cancellation, or partial or full release
or discharge, and all other comparable instruments, with respect to such
Receivables or to the Financed Vehicles securing such Receivables. If the
Servicer shall commence a legal proceeding to enforce a Receivable, the Trustee
(in the case of a Receivable other than a Purchased Receivable) shall thereupon
be deemed to have automatically assigned, solely for the purpose of collection,
such Receivable to the Servicer. If in any enforcement suit or legal
proceeding it shall be held that the Servicer may not enforce a Receivable on
the ground that it shall not be a real party in interest or a holder entitled
to enforce the Receivable, the Trustee shall, at the Servicer's expense and
direction, take steps to enforce the Receivable, including bringing suit in its
name or the name of the Certificateholders. The Trustee shall furnish the
Servicer with any powers of attorney and other documents reasonably necessary
or appropriate to enable the Servicer to carry out its servicing and
administrative duties hereunder. The Servicer, at its expense, shall obtain on
behalf of the Trust all licenses, if any, required by the laws of any
jurisdiction to be held by the Trust in connection with
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ownership of the Receivables, and shall make all filings and pay all fees as
may be required in connection therewith during the term hereof.
Section 13.2 Collection of Receivable Payments. The
Servicer shall make reasonable efforts to collect all payments called for under
the terms and provisions of such Receivables as and when the same shall become
due and shall follow such collection procedures as it follows with respect to
all comparable receivables that it services for itself or others. The Servicer
may grant extensions, rebates, or adjustments on a Receivable, which shall not,
for the purposes of the Agreement (other than Section 13.6 hereof), modify the
original due dates and amounts of the Scheduled Payments. The Servicer may in
its discretion waive any late payment charge or any other fees that may be
collected in the ordinary course of servicing a Receivable.
Section 13.3 Realization Upon Receivables. On behalf of
the Trust, the Servicer shall use reasonable efforts, consistent with its
customary servicing procedures, to repossess or otherwise convert the ownership
of the Financed Vehicle securing any Receivable as to which the Servicer shall
have determined eventual payment in full is unlikely. The Servicer shall follow
such customary and usual practices and procedures as it shall deem necessary or
advisable in its servicing of comparable receivables, which may include
reasonable efforts to realize upon any Dealer Recourse and selling the Financed
Vehicle at public or private sale. The foregoing shall be subject to the
provision that, in any case in which the Financed Vehicle shall have suffered
damage, the Servicer shall not expend funds in connection with the repair or
the repossession of such Financed Vehicle unless it shall determine in its
discretion that such repair and/or repossession will increase the Liquidation
Proceeds by an amount greater than the amount of such expenses.
Section 13.4 [Reserved]
Section 13.5 Maintenance of Security Interests in Financed
Vehicles. The Servicer shall, in accordance with its customary servicing
procedures, take such steps as are necessary to maintain perfection of the
security interest created by each Receivable in the related Fi-
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nanced Vehicle. The Trustee hereby authorizes the Servicer to take such steps
as are necessary to reperfect such security interest on behalf of the Trust in
the event of the relocation of a Financed Vehicle or for any other reason.
Section 13.6 Covenants of Servicer. The Servicer shall not
release the Financed Vehicle securing each such Receivable from the security
interest granted by such Receivable in whole or in part except in the event of
payment in full by or on behalf of the Obligor thereunder or repossession, nor
shall the Servicer impair the rights of the Certificateholders in the
Receivables, nor shall the Servicer change the Annual Percentage Rate with
respect to any Receivable, nor shall the Servicer modify the number or
amount of Scheduled Payments under a Receivable.
Section 13.7 Purchase of Receivables Upon Breach. (a) The
Servicer or the Trustee shall inform the other party promptly, in writing, upon
the discovery of any breach pursuant to Section 13.2, 13.5 or 13.6. Unless the
breach shall have been cured by the last day of the second Collection Period
following such discovery (or, at the Servicer's election, the last day of the
first following Collection Period), the Servicer shall purchase any Receivable
materially and adversely affected by such breach as determined by the Trustee
(which shall include any Receivable as to which a breach of Section 13.6 has
occurred). In consideration of the purchase of such Receivable, the Servicer
shall remit the Purchase Amount in the manner specified in Section 14.5. For
purposes of this Section 13.7, the Purchase Amount shall consist in part of a
release by the Servicer of all rights of reimbursement with respect to
Outstanding Advances on the Receivable. The sole remedy of the Trustee, the
Trust, or the Certificateholders with respect to a breach pursuant to Section
13.2, 13.5 or 13.6 shall be to require the Servicer to purchase Receivables
pursuant to this Section 13.7.
(b) In the event that the Obligor with respect to a
Receivable shall have been declared bankrupt and at such time or thereafter the
Servicer's records relating to such Receivable shall record that the periodic
payment thereon has been reduced at or since such declaration and that such
Receivable has been extended
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beyond September 30, 2000, the Servicer shall pay an amount equal to the amount
of a prepayment which would cause such a reduction in the amount of the new
periodic payment over the remainder of the original scheduled life of the
Receivable.
Section 13.8 Servicer Fee. The Servicer shall be
entitled to any interest earned on the amounts deposited in the Collection
Account and the Payahead Account during such Collection Period plus
all late fees, prepayment charges (including, in the case of a Receivable
that provides for payments according to the "Rule of 78's" and that is prepaid
in full, the difference between the Principal Balance of such Receivable (plus
accrued interest to the date of prepayment) and the principal balance of such
Receivable computed according to the "Rule of 78's"), and other administrative
fees and expenses or similar charges allowed by applicable law with respect to
Receivables during such Collection Period (the "Supplemental Servicing Fee").
The Servicer also shall be entitled to the Servicing Fee, as provided herein.
Section 13.9 Servicer's Certificate. (a) On or about
the tenth day of each calendar month, the Servicer shall deliver to
the Trustee (with a copy to each of the rating agencies requested to
provide a rating on the Class A Certificates) a Servicer's Certificate
containing all information necessary to make the distributions pursuant
to Section 14.6 (including, if required, withdrawals from or deposits to the
Payahead Account and Advances by the Servicer pursuant to Section 14.4) for
the Collection Period preceding the date of such Servicer's Certificate,
and all information necessary for the Trustee to send statements to
Certificateholders pursuant to Section 14.9. Receivables purchased or to
be purchased by the Servicer or the Seller shall be identified by the
Servicer by the Seller's account number with respect to such Receivable
(as specified in Schedule A of the Agreement).
(b) On or about the fifth (but in no event
later than the tenth) calendar day of each calendar month, the Servicer shall
deliver to the underwriter(s) of the Class A Certificates the Class A
Certificate Factor as of the close of business on the Distribution Date
occurring in that month.
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Section 13.10 Annual Statement as
to Compliance; Notice of Default. (a) The Servicer shall deliver to the
Trustee and to each of the rating agencies requested by the Seller or an
affiliate to provide a rating on the Class A Certificates which is then rating
the Class A Certificates, on or before April 30 of each year beginning April
30, 1996, an Officer's Certificate, dated as of December 31 of the preceding
calendar year, stating that (i) a review of the activities of the Servicer
during the preceding 12-month (or shorter) period and of its performance under
the Agreement has been made under such officer's supervision and (ii) to the
best of such officer's knowledge, based on such review, the Servicer has
fulfilled all its obligations under the Agreement throughout such year, or, if
there has been a default in the fulfillment of any such obligation, specifying
each such default known to such officer and the nature and status thereof. A
copy of such certificate and the report referred to in Section 13.11 may be
obtained by any Certificateholder by a request in writing to the Trustee
addressed to the Corporate Trust Office.
(b) The Servicer shall deliver to the
Trustee and to each of the rating agencies requested by the Seller or an
affiliate to provide a rating on the Class A Certificates which is then rating
the Class A Certificates, promptly after having obtained knowledge thereof, but
in no event later than 5 Business Days thereafter, written notice in an
Officer's Certificate of any event which with the giving of notice or lapse of
time, or both, would become an Event of Default under Section 19.1. The Seller
shall deliver to the Trustee and to each of such rating agencies then rating
the Class A Certificates, promptly after having obtained knowledge thereof, but
in no event later than 5 Business Days thereafter, written notice in an
Officer's Certificate of any event which with the giving of notice or lapse of
time, or both, would become an Event of Default under clause (ii) of Section
19.1.
Section 13.11 Annual Independent Certified
Public Accountant's Report. The Servicer shall cause a firm of independent
certified public accountants, who may also render other services to the
Servicer or to the Seller or to Ford Motor Credit Company, to deliver to the
Trustee and each of the rating agencies then rating the Class A Certificates
on or before April 30 of each year
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beginning April 30, 1996 with respect to the prior calendar year a report
addressed to the Board of Directors of the Servicer and to the Trustee, to the
effect that such firm has audited the financial statements of the Servicer and
issued its report thereon and that such audit (1) was made in accordance with
generally accepted auditing standards, (2) included tests relating to
automotive loans serviced for others in accordance with the requirements of the
Uniform Single Audit Program for Mortgage Bankers (the "Program"), to the
extent the procedures in such Program are applicable to the servicing
obligations set forth in the Agreement, and (3) except as described in the
report, disclosed no exceptions or errors in the records relating to automobile
and light truck loans serviced for others that, in the firm's opinion,
paragraph four of such Program requires such firm to report.
The Report will also indicate that the firm is independent of
the Servicer within the meaning of the Code of Professional Ethics of the
American Institute of Certified Public Accountants.
Section 13.12 Access to Certain Documentation
and Information Regarding Receivables. The Servicer shall provide to
the Certificateholders access to the Receivables Files in such cases
where the Certificateholder shall be required by applicable statutes or
regulations to review such documentation. Access shall be afforded without
charge, but only upon reasonable request and during the normal business hours
at the respective offices of the Servicer. Nothing in this Section shall
affect the obligation of the Servicer to observe any applicable law prohibiting
disclosure of information regarding the Obligors, and the failure of the
Servicer to provide access to information as a result of such obligation shall
not constitute a breach of this Section 13.12.
Section 13.13 Servicer Expenses. The Servicer shall be
required to pay all expenses incurred by it in connection with its activities
hereunder, including fees and disbursements of independent accountants,
taxes imposed on the Servicer and expenses incurred in connection with
distributions and reports to Certificateholders.
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ARTICLE ARTICLE XIV
Distributions; Subordination Spread Account;
Statements to Certificateholders
Section 14.1 Accounts. (a) The Servicer shall establish
the Collection Account and the Certificate Account in the name of the
Trustee for the benefit of the Certificateholders, and shall establish
the Payahead Account in the name of the Trustee on behalf of the Obligors.
The Collection Account and the Payahead Account shall be segregated
trust accounts initially established with the Trustee and maintained with the
Trustee so long as (i) the deposits of the Trustee have the Required Deposit
Rating or (ii) the Collection Account and the Payahead Account are maintained
in the Corporate Trust Department of the Trustee; provided, however, that all
amounts held in the Collection Account and the Payahead Account shall, to the
extent permitted by applicable laws, rules, and regulations, be invested as
directed in writing by the Servicer, by the bank or trust company then
maintaining the accounts in interest-bearing time deposits of such bank or
trust company (provided that such investments shall have the Required Deposit
Rating) that mature not later than the Distribution Date for the Collection
Period to which such amounts relate and any such time deposits so acquired
shall be held until maturity and provided, further that if the Servicer is
required to remit collections daily to the Collection Account pursuant to
Section 14.2 then such remittances, and any remittances to the Payahead
Account, shall be invested at the written direction of the Servicer as to
specific investments in investments rated A-1+ by Standard & Poor's Ratings
Group and P-1 by Moody's Investors Service, Inc. or in other investments as may
be permitted by each of such rating agencies, in each case maturing in
immediately available funds on the Distribution Date next succeeding the date
of investment. Such written direction shall certify that any such investment
is authorized by this Section. The Certificate Account shall be a segregated
trust account established and maintained with the Trustee, and the amounts in
such account shall not be invested. Should the short-term unsecured debt
obligations of the Trustee no longer have the Required Deposit Rating then,
unless the Collection Account and the Payahead Account are maintained in the
Corporate Trust Department of the Trustee, the Servicer
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shall as soon as is reasonably practical, with the Trustee's assistance as
necessary, cause the Collection Account and the Payahead Account (i) to be
moved to a bank or trust company, the short-term unsecured debt obligations of
which shall have the Required Deposit Rating or (ii) to be moved to the
Corporate Trust Department of the Trustee. In no event shall the Payahead
Account be property of the Trust or security for the Certificates.
(b) Notwithstanding the provisions of
clause (a) above and of the third paragraph of Section 14.6(a), for so long as
(i) Ford Motor Credit Company is the Servicer, (ii) the rating of Ford Motor
Credit Company's short-term unsecured debt is at least P-1 by Moody's Investors
Service, Inc. and is at least A-1 by Standard & Poor's Ratings Group and (iii)
no Event of Default shall have occurred (each, a "Monthly Remittance
Condition"), Payaheads need not be remitted to and deposited in the Payahead
Account but instead may be remitted to and held by the Servicer. So long as
each Monthly Remittance Condition is satisfied, the Servicer shall not be
required to segregate or otherwise hold separate any Payaheads remitted to the
Servicer as aforesaid but shall be required to remit Payaheads to the
Certificate Account in accordance with Section 14.6(a)(ii). At any time as any
Monthly Remittance Condition is not satisfied, the Servicer shall deposit in
the Payahead Account the amount of any Payaheads then held or received by it
(which amount shall be at least equal to the Payahead Balance as of the close
of business on the last day of the immediately preceding Collection Period).
Notwithstanding the foregoing, if a Monthly Remittance Condition is not
satisfied the Servicer may utilize, with respect to Payaheads, an alternative
remittance schedule (which may include the remittance schedule utilized by the
Servicer before the Monthly Remittance Condition became unsatisfied), if the
Servicer provides to the Trustee written confirmation from each rating agency
which has an outstanding rating on the Class A Certificates and was requested
by the Seller or an affiliate to rate the Class A Certificates that such
alternative remittance schedule will not result in the downgrading or
withdrawal by such rating agencies of the ratings then assigned to the Class A
Certificates. The Trustee shall not be deemed to have knowledge of any event
or circumstance under clause (iii) of the first sentence of this Section
14.1(b) that would
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require remittance of the Payaheads to the Payahead Account unless the Trustee
has received notice of such event or circumstance from the Seller or the
Servicer in an Officer's Certificate or from the Holders of Class A
Certificates evidencing not less than 25% of the Class A Certificate Balance or
unless a Trustee Officer in the Corporate Trust Office with knowledge hereof
and familiarity herewith has actual knowledge of such event or circumstance.
Section 14.2 Collections. The Servicer shall remit daily
to the Collection Account (i) all payments by or on behalf of the Obligors
(including Payaheads on the Receivables but excluding Purchased
Receivables) and (ii) all Liquidation Proceeds, both as collected during the
Collection Period. Ford Motor Credit Company, so long as it is acting as the
Servicer, may 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 14.2 and only for so long as such
terms and conditions are fulfilled. Accordingly, notwithstanding the
provisions of the first sentence of this Section 14.2, the Servicer shall remit
collections received during a Collection Period to the Collection Account in
immediately available funds on the related Distribution Date but only for so
long as each Monthly Remittance Condition is satisfied. Notwithstanding the
foregoing, if a Monthly Remittance Condition is not satisfied the Servicer may
utilize an alternative remittance schedule (which may include the remittance
schedule utilized by the Servicer before the Monthly Remittance Condition
became unsatisfied), if the Servicer provides to the Trustee written
confirmation from each rating agency which has an outstanding rating on the
Class A Certificates and was requested by the Seller or an affiliate to rate
the Class A Certificates that such alternative remittance schedule will not
result in the downgrading or withdrawal by such rating agencies of the ratings
then assigned to the Class A Certificates. The Trustee shall not be deemed to
have knowledge of any event or circumstance under clause (iii) of the
definition of Monthly Remittance Condition that would require daily remittance
by the Servicer to the Collection Account unless the Trustee has received
notice of such event or circumstance from the Seller or the Servicer in an
Officer's Certifi-
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cate or from the Holders of Class A Certificates evidencing not less than 25%
of the Class A Certificate Balance or a Trustee Officer in the Corporate Trust
Office with knowledge hereof or familiarity herewith has actual knowledge of
such event or circumstance. For purposes of this Article XIV the phrase
"payments by or on behalf of Obligors" shall mean payments made by Persons
other than the Servicer or by other means.
Section 14.3 Application of Collections. For the purposes
of this Agreement, as of the close of business on the last day of each
Collection Period, all collections for the Collection Period with respect to
each Receivable (other than a Purchased Receivable) shall be applied by the
Servicer as follows:
Payments by or on behalf of the Obligor which are not late
fees, prepayment charges, or other administrative fees and expenses,
or similar charges, applied in accordance with Section 13.8 shall be
applied first to reduce Outstanding Advances made with respect to such
Receivable, as described in Section 14.4(a) below. Next, any excess
shall be applied to the Scheduled Payment with respect to such
Receivable. Finally, any remaining excess (except partial prepayments
which cause a reduction in the Obligor's periodic payment to below the
Scheduled Payment as of the Cutoff Date) shall be added to the
Payahead Balance, and shall be applied to prepay the Receivable, but
only if the sum of such excess and the previous Payahead Balance shall
be sufficient to prepay the Receivable in full. Otherwise, any
remaining excess payments shall constitute a Payahead, and shall
increase the Payahead Balance.
Section 14.4 Advances. (a) As of the close of business
on the last day of each Collection Period, if the payments by or on behalf
of the Obligor on a Receivable (other than a Purchased Receivable) after
application under 14.3 shall be less than the Scheduled Payment, whether as a
result of any extension granted to the Obligor or otherwise, the Payahead
Balance, if any, with respect to such Receivables shall be applied by the
Servicer to the extent of the shortfall, and such
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Payahead Balance shall be reduced accordingly. Next, subject to the following
sentence, the Servicer shall make an Advance of any remaining shortfall. The
Servicer will be obligated to make an Advance in respect of a Receivable only
to the extent that the Servicer, in its sole discretion, shall determine that
the Advance shall be recoverable from subsequent collections or recoveries on
any Receivable. With respect to each Receivable, the Advance shall increase
Outstanding Advances. Outstanding Advances shall be reduced by subsequent
payments by or on behalf of the Obligor, collections of Liquidation Proceeds
and payments of the Purchase Amount.
If the Servicer shall determine that an
Outstanding Advance with respect to any Receivable shall not be recoverable,
the Servicer shall be reimbursed from any collections made on other Receivables
in the Trust, and Outstanding Advances with respect to such Receivable shall be
reduced accordingly.
(b) In the event that an Obligor shall
prepay a Receivable in full, if the related contract did not require such
Obligor to pay a full month's interest, for the month of prepayment, at the
Annual Percentage Rate, the Servicer shall make an unreimbursable advance of
the amount of such interest.
Section 14.5 Additional Deposits. The Servicer shall
deposit in the Collection Account the aggregate Advances pursuant to
Section 14.4(a) and the aggregate advances pursuant to Section 14.4(b). To the
extent that the Servicer fails to make an advance pursuant to Section 14.4(b)
on the date required, the Class A Agent shall withdraw such amount from the
Subordination Spread Account and deposit such amount in the Collection Account.
The Servicer and the Seller shall deposit in the Collection Account the
aggregate Purchase Amount with respect to Purchased Receivables and the
Servicer shall deposit therein all amounts to be paid under Sections 21.2 and
13.7(b). All such deposits with respect to a Collection Period shall be made,
in immediately available funds, on the Distribution Date related to such
Collection Period.
Section 14.6 Distributions.
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(a) On each Distribution
Date, the Trustee shall cause to be made the following transfers and
distributions in the amounts set forth in the Servicer's Certificate for such
Distribution Date:
(i) From the Collection Account to
the Certificate Account, in immediately
available funds, the entire amount then on deposit in
the Collection Account; provided, however, that in
the event that the Servicer is required to make
deposits to the Collection Account on a daily basis
pursuant to Section 14.2, the amount of the funds
transferred from the Collection Account to the
Certificate Account will include only those funds
that were deposited in the Collection Account for the
Collection Period related to such Distri- bution
Date.
(ii) From the Payahead Account, or
from the Servicer in the event the provisions of
Section 14.1(b) above are applicable, to the
Certificate Account, in immediately available funds,
(x) the portion of Payaheads constituting Scheduled
Payments or prepayments in full, required by Sections
14.3 and 14.4(a), and (y) the Payahead Balance, if
any, relating to any Purchased Receiv- able.
(iii) From the Certificate Account
to the Payahead Account, or to the Servicer in the
event the provisions of Sections 14.1(b) above are
applicable, in immediately available funds, the
aggregate Payaheads required by Section 14.3 for the
Collection Period related to such Distribution Date.
(iv) From the Certificate Account to
the Servicer, in immediately available funds,
repayment of Outstanding Advances pursuant to
Section 14.4(a).
(b) Prior to each Distribution Date, the
Servicer shall on each Determination Date calculate the Total Available Amount,
the Available Interest, the Available Principal, the Class A Distributable
Amount and the Class B Distributable Amount and, based on the Total
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Available Amount and the other distributions to be made on such Distribution
Date, determine the amount distributable to Certificateholders of each Class.
(c) On each Distribution Date, the Trustee (based on
the information contained in the Servicer's Certificate delivered on the
related Determination Date pursuant to Section 13.9) shall, subject to
subsection (d) hereof, make the following distributions in the following
order of priority:
(i) first, to the Servicer, from the Available
Interest, the Servicing Fee and all unpaid Servicing Fees
from prior Collection Periods;
(ii) second, to the Class A Certificateholders:
(A) from the Class A Percentage of the Available
Interest (except as provided in the proviso to subsection (d)(i)
below) (as such Available Interest has been reduced by Servicing
Fee payments), an amount equal to the sum of the Class A Interest
Distributable Amount and any outstanding Class A Interest
Carryover Shortfall as of the close of the preceding Distribution
Date (plus, to the extent not otherwise provided for, interest
on such Class A Interest Carryover Shortfall at the Pass-
Through Rate from such preceding Distribution Date through the
current Distribution Date, to the extent permitted by law);
(B) from the Class A Percentage of the Available
Principal, an amount equal to the sum of the Class A Principal
Distributable Amount and any outstanding Class A Principal Carryover
Shortfall as of the close of the preceding Distribution Date;
(iii) third, to the Class B Certificateholders
subject to Section 14.7(d) below:
(A) from the Available Interest (as such
Available Interest has been
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reduced by payments pursuant to clauses (i) and (ii) above), an amount
equal to the sum of the Class B Interest Distributable Amount and any
outstanding Class B Interest Carryover Shortfall as of the close of
the preceding Distribution Date; and
(B) from the Class B Percentage of the Available
Principal, an amount equal to the sum of the Class B Principal
Distributable Amount and any outstanding Class B Principal Carryover
Shortfall as of the close of the preceding Distribution Date;
provided, however, that amounts otherwise distributable to the Class B
Certificateholders shall instead be deposited by the Trustee in the
Subordination Spread Account to the extent provided in Section 14.7(c) hereof
to cover any Subordination Spread Account deficiency resulting from payments on
such Distribution Date from the Subordination Spread Account pursuant to
Section 14.6(d) or otherwise.
(d) The rights of the Class B Certificateholders to
receive distributions in respect of the Class B Certificates shall be and
hereby are subordinated to the rights of the Class A Certificateholders to
receive distributions in respect of the Class A Certificates and the rights
of the Servicer to receive the Servicing Fee (and any accrued and unpaid
Servicing Fees from prior Collection Periods) in the event of delinquency
or defaults on the Receivables. Such subordination shall be effected as
follows, and all payments shall be effected pursuant to clause (i) below
prior to any payments pursuant to clause (ii):
(i) If the Class A Percentage of the Available Interest (as such
Available Interest has been reduced by Servicing Fee payments) is less
than the sum of the Class A Interest Distributable Amount and any
Class A Interest Carryover Shortfall (including interest on such
Shortfall as provided in paragraph (c)(ii)(A) above) from the
preceding Distribution Date, the Class A Certificateholders shall be
entitled to receive distributions in respect of such deficiency first,
from the Class B
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Percentage of the Available Interest; second, if such amounts are
insufficient, from amounts on deposit in the Subordination Spread
Account; and third, if such amounts are insufficient, from the Class B
Percentage of the Available Principal; provided, however , that if the
amount required to be advanced by the Servicer pursuant to Section
14.4(b) for the Collection Period shall not have been advanced by the
Servicer, the resulting shortfall shall be allocated pro rata among
the Class A Certificates and the Class B Certificates and any such
shortfall with respect of the Class A Certificates (and any Class A
Carryover Shortfalls attributable thereto) shall be paid only from
amounts that are or become available in the Subordination Spread
Account after giving effect to any deposit thereto on such day. Upon
either the written instructions of the Servicer or the written
instructions of the Trustee (based solely on the information contained
in the Servicer's Certificate delivered on the related Determination
Date pursuant to Section 13.9), the Class A Agent shall release from
the amounts available in the Subordination Spread Account the amounts
required pursuant to Section 14.6(c)(ii) above and distribute such
amounts to the Trustee.
(ii) If the Class A Percentage of the Available Principal
is less than the sum of the Class A Principal Distributable Amount
and any Class A Principal Carryover Shortfall from the preceding
Distribution Date, the Class A Certificateholders shall be
entitled to receive distributions in respect of such deficiency first,
from the Class B Percentage of the Available Principal; second, if such
amounts are insufficient, from amounts on deposit in the
Subordination Spread Account; and third, if such amounts are
insufficient, from the Class B Percentage of the Available Interest.
Upon either the written instructions of the Servicer or the
written instructions of the Trustee (based solely on the information
contained in the Servicer's Certificate delivered on the related
Determination Date pursuant to
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Section 13.9), the Class A Agent shall release from the amounts
available in the Subordination Spread Account the amounts required
pursuant to Section 14.6(c)(ii) above and distribute such amounts to
the Trustee.
(e) Subject to Section 21.1 respecting the final
payment upon retirement of each Certificate, the Servicer shall on each
Distribution Date instruct the Trustee to distribute to each Certificateholder
of any Class of record on the preceding Record Date either by wire transfer,
in immediately available funds to the account of such holder at a bank or
other entity having appropriate facilities therefor, if such Certificateholder
is the Seller or a Clearing Agency and shall have provided to the Servicer
appropriate instructions prior to such Distribution Date, or, if not, by
check mailed to such Certificateholder (such check to be mailed as soon as
reasonably practicable on or after such Distribution Date) at the address of
such holder appearing in the Certificate Register, the amounts to be
distributed to such Certificateholder pursuant to such holder's Certificates.
Section 14.7 Subordination; Subordination Spread
Account; Priority of Distributions.
(a)(i) In order to effectuate the subordination
provided for herein, there shall be established and maintained with the
Class A Agent a separate trust account (the "Subordination Spread Account")
to include the money and other property deposited and held therein pursuant
to this subsection 14.7(a)(i) and subsection 14.7(a)(ii). The Subordination
Spread Account shall be maintained in the name "Chemical Bank, as Class A
Agent." On the date of issuance of the Certificates, the Seller shall
deposit the Subordination Initial Deposit, if any, into the Subordination
Spread Account. The Subordination Spread Account shall not be part of the
Trust. Each of the Class A Certificateholders, on behalf of itself and its
successors and assigns (including, but not limited to, any future Holder of a
Class A Certificate) hereby appoints Chemical Bank, acting in its capacity as
agent for the purposes of this Section 14.7 and not as Trustee, with respect
to the Subordination Spread Account and the Subordination Spread Account
Property
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(the "Class A Agent"), and the Class A Agent hereby accepts such appointment.
(ii) In order to provide for the prompt
payment to the Class A Certificateholders and the Servicer, in
accordance with subsections 14.6(c) and 14.6(d), to give effect to the
subordination provided for herein, and to assure availability of the
amounts maintained in the Subordination Spread Account:
(A) The Seller, as initial holder
of the Class B Certificates, hereby sells, conveys, and transfers to
the Class A Agent and its successors and assigns, the Subordination
Initial Deposit and all proceeds thereof, subject, however, to the
limitations set forth below, and solely for the purpose of
providing for payment of the Class A Distributable Amount
provided for in Section 14.6 and this Section; and
(B) The Seller, as initial holder
of the Class B Certificates, on behalf of itself and its successors
and assigns hereby sells, conveys, and transfers to the Class A
Agent, all its right, title, and interest in and to the Subordination
Spread Account, subject, however, to the limitations set forth
below, and all proceeds of the foregoing, including, without
limitation, all other amounts and investments held from time to time
in the Subordination Spread Account (whether in the form of deposit
accounts, Physical Property, book-entry securities, or otherwise)
subject, however, to the limitations set forth below, and solely for
the purpose of providing for payment of the Class A Distributable
Amount provided for in Section 14.6 and this Section;
(all of the foregoing, subject to the limitations set forth below, the
"Subordination Spread Account Property"), to have and to hold all the aforesaid
property, rights and privileges unto the Class A Agent, its successors and
assigns, in trust for the uses and purposes, and subject to the terms and
provisions, set forth in this Section 14.7. The Class A Agent hereby
acknowledges such
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transfer and accepts the trust hereunder and shall hold and distribute the
Subordination Spread Account Property in accordance with the terms and
provisions of this Section 14.7.
(i) The trust established pursuant
to this Section 14.7 shall not under any circumstances be deemed to be
part of or otherwise includable in the Trust.
(b) On each Distribution Date, if the amount of
the Subordination Spread Account (after giving effect to all payments
to be made from such Account pursuant to Section 14.6(d) on such Date) is less
than the Specified Subordination Spread Account Balance for such Distribution
Date, the Servicer shall instruct the Trustee, after payment of any amounts
required to be distributed to Class A Certificateholders and the Servicer, to
withhold from amounts otherwise distributable to the Class B Certificateholders
and not otherwise distributed to Class A Certificateholders or the Servicer and
deposit in the Subordination Spread Account all such amounts, or such lesser
amounts as are sufficient to restore the amount in the Subordination Spread
Account to the Specified Subordination Spread Account Balance. For purposes of
calculating the Class B Certificate Balance, any amounts so deposited will be
deemed to have been paid to the Class B Certificateholders. Subject to Section
14.7(d), if the amount of the Subordination Spread Account (after taking into
account any withdrawals therefrom pursuant to Section 14.7(e)) is greater than
the Specified Subordination Spread Account Balance for such Distribution Date,
the Class A Agent shall upon the written instruction of the Servicer release to
the Trustee and, the Trustee at the instruction of the Servicer, shall
distribute the amount of the excess to the Class B Certificateholders on a pro
rata basis in accordance with their ownership of the Class B Certificates.
Amounts properly distributed to the Class B Certificateholders pursuant to this
Section 14.7(c), either directly from the Certificate Account without deposit
in the Subordination Spread Account or from the Subordination Spread Account,
shall be deemed released from the trust established by this Section 14.7, and
Class B Certificateholders shall in no event thereafter be required to refund
any such distributed amounts.
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(c) (i) Amounts held in the Subordination
Spread Account shall be invested in the manner specified in Section 14.1(a),
in accordance with written instructions from the holders of Class B
Certificates evidencing not less than 51% of the Class B Certificate
Balance or their designee, and such investments shall not be sold or disposed
of prior to their maturity. All such investments shall be made in the name of
the Class A Agent or its nominee and all income and gain realized thereon shall
be solely for the benefit of the Class B Certificateholders and shall be
payable by the Class A Agent to the Class B Certificateholders on each
Distribution Date.
(ii) With respect to the Subordination
Spread Account Property, the Class B Certificateholders and the Class
A Agent agree that:
(A) Any Subordination Spread
Account Property that is held in deposit accounts shall be held
solely in the name of the Class A Agent at one or more depository
institutions having the Required Deposit Rating. Each such Deposit
Account shall be subject to the exclusive custody and control of the
Class A Agent, and the Class A Agent shall have sole signature
authority with respect thereto.
(B) Any Subordination Spread
Account Property that constitutes Physical Property shall be
delivered to the Class A Agent in accordance with paragraph (a) of
the definition of "Delivery" and shall be held, pending maturity or
disposition, solely by the Class A Agent or a financial intermediary
(as such term is defined in Section 8-313(4) of the UCC) acting
solely for the Class A Agent.
(C) Any Subordination Spread
Account Property that is a book-entry security held through the
Federal Reserve System pursuant to federal book-entry regulations shall
be delivered in accordance with paragraph (b) of the definition of
"Delivery" and shall be maintained by the Class A Agent, pending
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maturity or disposition, through continued book-entry registration of
such Subordination Spread Account Property as described in such
paragraph.
(D) Property of a type which is
not capable of being delivered to the Class A Agent in
accordance with the definition of "Delivery" shall not constitute
Subordination Spread Account Property.
Effective upon Delivery of any Subordination Spread Account
Property in the form of Physical Property or book-entry securities, the Class A
Agent shall be deemed to have represented that it has purchased such
Subordination Spread Account Property for value, in good faith, and without
notice of any adverse claim thereto.
(iii) Investment earnings attributable to the
Subordination Spread Account Property and proceeds therefrom shall be
held by the Class A Agent for the benefit of the Class B
Certificateholders. Investment earnings attributable to the
Subordination Spread Account Property shall not be available to
satisfy the subordination provisions of this Agreement and shall not
otherwise be subject to any claims or rights of the Class A
Certificateholders or the Servicer. The Class A Agent shall cause all
investment earnings attributable to the Subordination Spread Account
to be distributed on each Distribution Date to the Class B
Certificateholders. Notwithstanding the foregoing, the Subordination
Spread Account may contain at any time uninvested cash in an amount
not to exceed the maximum amount insured by the FDIC without giving
rise to any obligation to withdraw such cash from the Subordination
Spread Account. Realized losses, if any, on investment of the
Subordination Spread Account Property shall be charged first against
undistributed investment earnings attributable to the Subordination
Spread Account Property and then against the Subordination Spread
Account Property.
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(iv) The Class A Agent shall not
enter into any subordination or intercreditor agreement with respect
to the Subordination Spread Account Property.
(d) If the Servicer pursuant to Section 14.4
determines on any Determination Date that it is required to make an Advance and
does not do so from its own funds, the Servicer shall promptly instruct the
Class A Agent in writing to withdraw funds, in an amount specified by the
Servicer, from the Subordination Spread Account and deposit them in the
Certificate Account maintained with the Trustee to cover any shortfall. Such
payment shall be deemed to have been made by the Servicer pursuant to Section
14.4 for purposes of making distributions pursuant to this Agreement, but shall
not otherwise satisfy the Servicer's obligation to deliver the amount of the
Advances to the Class A Agent, and the Servicer shall within two Business Days
replace any funds in the Subordination Spread Account so used.
(e) Upon termination of this Agreement in
accordance with Section 21.2, any amounts on deposit in the Subordination
Spread Account shall be paid to the then holders of the Class B Certificates.
Section 14.8 Net Deposits. For so long as (i) Ford Motor
Credit Company shall be the Servicer, (ii) the Servicer shall be entitled
pursuant to Section 14.2 to remit collections on a monthly rather than
daily basis, and (iii) the Servicer shall be entitled pursuant to Section
14.1(b) to retain Payaheads rather than deposit them in the Payahead Account,
Ford Motor Credit Company (in whatever capacity) may make the remittances
pursuant to Sections 14.2 and 14.5 above, net of amounts to be distributed to
Ford Motor Credit Company (in whatever capacity) pursuant to Section 14.6(c).
Nonetheless, the Servicer shall account for all of the above described
remittances and distributions except for the Supplemental Servicing Fee in the
Servicer's Certificate as if the amounts were deposited and/or transferred
separately.
Section 14.9 Statements to Class A Certificateholders. On
each Distribution Date, the Trustee shall include with each distribution
to each Class A Certificateholder, a statement (which statement shall also be
provided to each rating agency then rating the
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Class A Certificates) based on information in the Servicer's Certificate
furnished pursuant to Section 13.9, setting forth for the Collection Period
relating to such Distribution Date the following information:
(i) the amount of such distribution
allocable to principal;
(ii) the amount of such distribution
allocable to interest;
(iii) the Pool Balance as of the
close of business on the last day of the preceding
Collection Period;
(iv) the amount of the Servicing Fee
paid to the Servicer with respect to the related Collection
Period and the Class A Certificateholder's Class A
Percentage of the Servicing Fee and the amount of any unpaid
Servicing Fees and the change in such amount from that of
the prior Distribution Date;
(v) the amount of the Class A
Principal and Interest Carryover Shortfalls, if any, on such
Distribution Date and the change in the Class A Principal
and Interest Carryover Shortfalls from the preceding
Distribution Date;
(vi) the Class A Certificate Factor
and Class B Certificate Balance as of such Distribution Date;
(vii) the amount otherwise
distributable to the Class B Certificateholders that is
distributed to Class A Certificateholders on such
Distribution Date;
(viii) the balance of the
Subordination Spread Account on such Distribution Date,
after giving effect to distributions made on such
Distribution Date and the change in such balance from the
preceding Distribution Date;
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(ix) the aggregate Payahead Balance
and the change in such balance from the preceding
Distribution Date; and
(x) the amount of Advances on such
Distribution Date.
Each amount set forth pursuant to subclauses (i), (ii), (iv) or (v) above shall
be expressed as a dollar amount per $1,000 of original principal balance of a
Class A Certificate.
Within the prescribed period of time for tax reporting
purposes after the end of each calendar year during the term of the Agreement,
the Trustee shall mail, to each Person who at any time during such calendar
year shall have been a holder of a Class A Certificate, a statement containing
the sum of the amounts set forth in clauses (i), (ii), (iv) and (v) and such
other information, if any, as the Servicer determines is necessary to ascertain
the Class A Certificateholder's share of the gross income and deductions of the
Trust (exclusive of the Supplemental Servicing Fee), for such calendar year or,
in the event such Person shall have been a holder of a Class A Certificate
during a portion of such calendar year, for the applicable portion of such
year, for the purposes of such Certificateholder's preparation of federal
income tax returns.
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ARTICLE XV
[Intentionally Omitted]
ARTICLE XVI
The Certificates
Section 16.1 The Certificates. The Class A Certificates
shall be issued in denominations of $1,000; the Class B Certificates shall be
issued in denominations of $100,000 or in any amount in excess thereof each in
fully registered form and integral multiples thereof; provided, however, that
one Class A Certificate and one Class B Certificate may be issued in a
denomination equal to or including the residual amount (the "Residual
Certificate"). The Certificates shall be executed on behalf of the Trust by
manual or facsimile signature of the chairman of the board, vice chairman of
the board, any vice president, or any authorized Trust Officer of the Trustee
under the Trustee's seal imprinted thereon and attested on behalf of the Trust
by the manual or facsimile signature of the Secretary, any Assistant Secretary
or any Trust Officer of the Trustee. Certificates bearing the manual or
facsimile signatures of individuals who were, at the time when such signatures
shall have been affixed, authorized to sign on behalf of the Trust, shall be
valid and binding obligations of the Trust, notwithstanding that such
individuals or any of them shall have ceased to be so authorized prior to the
authentication and delivery of such Certificates or did not hold such offices
at the date of such Certificates.
Section 16.2 Authentication of Certificates. The Trustee
shall cause the Certificates to be executed on behalf of the Trust,
authenticated, and delivered to or upon the written order of the Seller, signed
by its chairman of the board, its president, or any vice president, without
further corporate action by the Seller, in authorized denominations, pursuant
to the Agreement. No Certificate shall entitle its holder to any benefit under
the 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
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Exhibit A or Exhibit B hereto executed by the Trustee by manual signature; such
authentication shall constitute conclusive evidence that such Certificate shall
have been duly authenticated and delivered hereunder. All Certificates shall
be dated the date of their authentication.
Section 16.3 Registration of
Transfer and Exchange of Certificates. The Certificate Registrar shall keep or
cause to be kept, at the office or agency maintained pursuant to Section 16.7,
a Certificate Register in which, subject to such reasonable regulations as it
may prescribe, the Trustee shall provide for the registration of Certificates
and of transfers and exchanges of Certificates as herein provided. The Trustee
shall be the initial Certificate Registrar.
The Class B Certificates shall initially be retained by the
Seller. No transfer of a Class B Certificate shall be made unless the
registration requirements of the Securities Act of 1933, as amended, and any
applicable State securities laws are complied with, or such transfer is exempt
from the registration requirements under said Act and laws. In the event that
a transfer is to be made in reliance upon an exemption from said Act or laws,
the Class B Certificateholder desiring to effect such transfer and such
Certificateholder's prospective transferee must each certify in writing to the
Seller and the Trustee the facts surrounding such transfer and provide both the
Seller and the Trustee with a written Opinion of Counsel in form and substance
satisfactory to the Seller and the Trustee that such transfer may be made
pursuant to an exemption from said Act or laws, which Opinion of Counsel shall
not be an expense of the Seller or the Trustee. Neither the Seller nor the
Trustee is under an obligation to register the Class B Certificates under said
Act or any other securities law.
No transfer of a Class B Certificate shall be made unless the
Class B Certificateholder desiring to effect such transfer shall have given
each rating agency requested by the Seller or an affiliate to rate the Class A
Certificates and which then has an outstanding rating thereon, the Seller and
the Trustee prior written notice of such proposed transfer, and such rating
agencies shall have notified such Class B Certificateholder, the Seller and the
Trustee, in writing, that such proposed transfer will not result in the
qualification, downgrading or
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withdrawal of the rating then assigned to the Class A Certificates by such
rating agencies.
In addition to the restrictions on transfer of Class B
Certificates set forth in the two immediately preceding paragraphs, no transfer
of a Class B Certificate shall be made unless prior to such transfer the Holder
of such Class B Certificate delivers to the Seller and the Trustee either a
ruling of the Internal Revenue Service or an Opinion of Counsel, which shall be
independent outside counsel, satisfactory to the Trustee and each rating agency
requested by the Seller or an affiliate to rate the Class A Certificates and
which has an outstanding rating thereon in either case to the effect that the
proposed transfer (x) will not result in the arrangement contemplated by this
Agreement being treated as an association (or publicly traded partnership)
taxable as a corporation under either (I) the Code, as from time to time in
force or (II) the tax laws of the State of New York and (y) will not have any
adverse effect on the Federal income taxation of the Trust or the Class A
Certificateholders. The Class B Certificate shall not be transferred
separately from the right to receive all amounts in the Subordination Spread
Account, unless the ruling of the Internal Revenue Service or the Opinion of
Counsel referred to in the preceding sentence would permit such transfer.
Upon surrender for registration of transfer of any Certificate
at the Corporate Trust Office, the Trustee shall execute, authenticate, and
deliver, in the name of the designated transferee or transferees, one or more
new Certificates in authorized denominations of a like aggregate amount dated
the date of authentication by the Trustee. At the option of a Holder,
Certificates may be exchanged for other Certificates of authorized
denominations of a like aggregate amount upon surrender of the Certificates to
be exchanged at the Corporate Trust Office.
Every Certificate presented or surrendered for registration of
transfer or exchange shall be accompanied by a written instrument of transfer
in form satisfactory to the Trustee and the Certificate Registrar duly executed
by the holder or his attorney duly authorized in writing. Each Certificate
surrendered for registration
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of transfer and exchange shall be cancelled and subsequently disposed of by the
Trustee.
No service charge shall be made for any registration of
transfer or exchange of Certificates, but the Trustee may require payment of a
sum sufficient to cover any tax or governmental charge that may be imposed in
connection with any transfer or exchange of Certificates.
Section 16.4 Mutilated, Destroyed, Lost, or Stolen
Certificates. If (a) any mutilated Certificate shall be surrendered to the
Certificate Registrar, or if the Certificate Registrar shall receive evidence
to its satisfaction of the destruction, loss, or theft of any Certificate and
(b) there shall be delivered to the Certificate Registrar and the Trustee such
security or indemnity as may be required by them to save each of them harmless,
then in the absence of notice that such Certificate shall have been acquired by
a bona fide purchaser, the Trustee on behalf of the Trust shall execute and the
Trustee shall authenticate and deliver, in exchange for or in lieu of any such
mutilated, destroyed, lost, or stolen Certificate, a new Certificate of like
tenor and denomination. In connection with the issuance of any new Certificate
under this Section 16.4, the Trustee and the Certificate Registrar may require
the payment of a sum sufficient to cover any tax or other governmental charge
that may be imposed in connection therewith. Any duplicate Certificate issued
pursuant to this Section 16.4 shall constitute conclusive evidence of ownership
in the Trust, as if originally issued, whether or not the lost, stolen, or
destroyed Certificate shall be found at any time.
Section 16.5 Persons Deemed Owners. The Trustee or the
Certificate Registrar may treat the Person in whose name any Certificate shall
be registered as the owner of such Certificate for the purpose of
receiving distributions pursuant to Section 14.6 and for all other purposes
whatsoever, and neither the Trustee nor the Certificate Registrar shall be
bound by any notice to the contrary.
Section 16.6 Access to List of Certificateholders' Names
and Addresses. The Trustee shall furnish or cause to be furnished to the
Servicer, within 15 days
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after receipt by the Trustee of a request therefor from the Servicer in
writing, a list, in such form as the Servicer may reasonably require, of the
names and addresses of the Certificateholders as of the most recent Record
Date. If three or more Certificateholders, or one or more Holders of Class A
Certificates aggregating not less than 25% of the Class A Certificate Balance,
apply in writing to the Trustee, and such application states that the
applicants desire to communicate with other Certificateholders of such Class
with respect to their rights under the Agreement or under the Certificates and
such application shall be accompanied by a copy of the communication that such
applicants propose to transmit, then the Trustee shall, within five Business
Days after the receipt for such application, request from the Clearing Agency
and make available to such Certificateholders 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 neither the
Servicer nor the Trustee accountable by reason of the disclosure of its name
and address, regardless of the source from which such information was derived.
Section 16.7 Maintenance of Office or Agency. The Trustee
shall maintain in the Borough of Manhattan, The City of New York, an office or
offices or agency or agencies where Certificates may be surrendered for
registration of transfer or exchange and where notices and demands to or upon
the Trustee in respect of the Certificates and the Agreement may be served.
The Trustee initially designates the Corporate Trust Office as specified in the
Agreement as its office for such purposes. The Trustee shall give prompt
written notice to the Servicer and to Certificateholders of any change in the
location of the Certificate Register or any such office or agency.
Section 16.8 Book-Entry Certificates. The Class A
Certificates, upon original issuance, (except for the Residual Certificate)
will be issued in the form of typewritten Certificates representing the
Book-Entry Certificates, to be delivered to The Depository Trust Company, the
initial Clearing Agency, by, or on behalf of, the Seller. The Class A
Certificates delivered to The Depository Trust Company shall initially be
registered on the Certificate Register in the name of CEDE &
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Co., the nominee of the initial Clearing Agency, and no Certificate Owner will
receive a definitive certificate representing such Certificate Owner's interest
in the Class A Certificates, except as provided in Section 16.10. Unless and
until definitive, fully registered Class A Certificates (the "Definitive
Certificates") have been issued to Certificate Owners pursuant to Section
16.10:
(i) the provisions of this Section 16.8 shall be in full
force and effect;
(ii) the Seller, the Servicer, the Certificate Registrar,
and the Trustee may deal with the Clearing Agency for all purposes
(including the making of distributions on the Class A Certificates) as
the autho- rized representative of the Certificate Owners;
(iii) to the extent that the provisions of this Section 16.8
conflict with any other provisions of this Agreement, the provisions
of this Section 16.8 shall control;
(iv) the rights of Certificate Owners shall be exercised
only through the Clearing Agency and shall be limited to those
established by law and agreements between such Certificate Owners and
the Clearing Agency and/or the Clearing Agency Participants. Pursuant
to the Depository Agreement, unless and until Definitive Certificates
are issued pursuant to Section 16.10, the initial Clearing Agency will
make book-entry transfers among the Clearing Agency Participants and
receive and transmit distributions of principal and interest on the
Class A Certificates to such Clearing Agency Participants; and
(v) whenever this Agreement requires or permits actions to
be taken based upon instructions or directions of Holders of Class A
Certificates evidencing a specified percentage of the Class A
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
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Certificate Owners and/or Clearing Agency Participants owning or
representing, respectively, such required percentage of the beneficial
interest in Class A Certificates and has delivered such instructions
to the Trustee.
Section 16.9 Notices to Clearing Agency. Whenever notice
or other communication to the Class A Certificateholders is required under this
Agreement, other than to the Holder of the Residual Certificate, unless and
until Definitive Certificates shall have been issued to Certificate Owners
pursuant to Section 16.10, the Trustee and the Servicer shall give all such
notices and communications specified herein to be given to Holders of the Class
A Certificates to the Clearing Agency.
Section 16.10 Definitive Certificates. If (i)(A) the
Seller advises the Trustee in writing that the Clearing Agency is no longer
willing or able to properly discharge its responsibilities under the Depository
Agreement, and (B) the Trustee or the Seller is unable to locate a qualified
successor, (ii) the Seller at its option, advises the Trustee in writing that
it elects to terminate the book-entry system through the Clearing Agency,
or (iii) after the occurrence of an Event of Default, Certificate Owners
representing beneficial interests aggregating not less than 51% of the Class A
Certificate Balance advise the Trustee and the Clearing Agency through the
Clearing Agency Participants in writing that the continuation of a book-entry
system through the Clearing Agency is no longer in the best interests of the
Certificate Owners, then the Trustee shall notify the Clearing Agency and
request that the Clearing Agency notify all Certificate Owners of the
occurrence of any such event and of the availability of Definitive Certificates
to Certificate Owners requesting the same and that the Record Date for any
Distribution Date subsequent to the issuance of Definitive Certificates will be
the last day of the Collection Period imme-
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diately preceding the month in which such Distribution Date occurs. Prior to
the issuance of Definitive Certificates, the Trustee shall provide written
notice to Goldman, Sachs & Co., CS First Boston Corporation, Merrill Lynch,
Pierce, Fenner & Smith Incorporated, J.P. Morgan Securities Inc. and Salomon
Brothers Inc that, upon the issuance of Definitive Certificates, the Record
Date for any Distribution Date will be the last day of the Collection Period
immediately preceding the month in which such Distribution Date occurs. Upon
surrender to the Trustee of the Class A Certificates by the Clearing Agency,
accompanied by registration instructions from the Clearing Agency for
registration, the Trustee shall issue the Definitive Certificates and deliver
such Definitive Certificates in accordance with the instructions of the
Clearing Agency. Neither the Seller, the Certificate Registrar nor the Trustee
shall be liable for any delay in delivery of such instructions and may
conclusively rely on, and shall be protected in relying on, such instructions.
Upon the issuance of Definitive Certificates, the Trustee shall recognize the
Holders of the Definitive Certificates as Certificateholders hereunder. The
Trustee shall not be liable if the Trustee or the Seller is unable to locate a
qualified successor Clearing Agency.
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ARTICLE XVII
The Seller
Section 17.1 Representations of Seller. The Seller makes
the following representations on which the Trustee relied in accepting the
Receivables in trust and executing and authenticating the Certificates. The
representations speak as of the execution and delivery of the Agreement and
shall survive the sale of the Receivables to the Trustee and, if applicable,
any subsequent assignment or transfer pursuant to Article XV:
(i) Organization and Good Standing. The Seller shall have
been duly organized and shall be validly existing as a corporation in
good standing under the laws of the State of Delaware, with power and
authority to own its properties and to conduct its business as such
properties shall be currently owned and such business is presently
conducted, and had at all relevant times, and shall have, power,
authority, and legal right to acquire and own the Receivables.
(ii) Due Qualification. The Seller shall be duly qualified
to do business as a foreign corporation in good standing, and shall
have obtained all necessary licenses and approvals in all
jurisdictions in which the ownership or lease of property or the
conduct of its business shall require such qualifications.
(iii) Power and Authority. The Seller shall have the power
and authority to execute and deliver the Agreement and to carry out
its terms. The Seller shall have full power and authority to sell and
assign the property to be sold and assigned to and deposited with the
Trustee as part of the Trust and shall have duly authorized such sale
and assignment to the Trustee by all necessary corporate action; and
the execution, delivery, and performance of the Agreement shall have
been
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duly authorized by the Seller by all necessary corporate action.
(iv) Valid Sale; Binding Obligations. The Agreement shall
evidence a valid sale, transfer, and assignment of the Receivables,
enforceable against creditors of and purchasers from the Seller; and a
legal, valid and binding obligation of the Seller enforceable in
accordance with its terms.
(v) No Violation. The consummation of the transactions
contemplated by the Agreement and the fulfillment of the terms hereof
shall not conflict with, result in any breach of any of the terms and
provisions of, nor constitute (with or without notice or lapse of
time) a default under, the articles of incorporation or by-laws of
the Seller, or any indenture, agreement, or other instrument to which
the Seller is a party or by which it shall be bound; nor result in the
creation or imposition of any Lien upon any of its properties pursuant
to the terms of any such indenture, agreement, or other instrument;
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.
(vi) No Proceedings. To the Seller's best knowledge, there
are no proceedings or investigations pending, or threatened, before
any court, regulatory body, administrative agency, or other govern-
mental instrumentality having jurisdiction over the Seller or its
properties: A) asserting the invalidity of the Agreement or the
Certificates; B) seeking to prevent the issuance of the Certificates
or the consummation of any of the transactions contemplated by the
Agreement; C) seeking any determination or ruling that might
materially and adversely affect the performance by the Seller of its
obligations under, or the validi-
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ty or enforceability of, the Agreement or the Certificates; or D)
relating to the Seller and which might adversely affect the federal
income tax attributes of the Certificates.
Section 17.2 Liability of Seller; Indemnities. The Seller
shall be liable in accordance herewith only to the extent of the obligations
specifically undertaken by the Seller under the Agreement.
(i) The Seller shall indemnify, defend, and hold harmless
the Trustee and the Trust from and against any taxes that may at any
time be asserted against the Trustee or the Trust with respect to, and
as of the date of, the sale of the Receivables to the Trust or the
issuance and original sale of the Certificates, including any sales,
gross receipts, general corporation, tangible personal property,
privilege, or license taxes (but, in the case of the Trust, not
including any taxes asserted with respect to ownership of the
Receivables or federal or other income taxes arising out of the
transactions contemplated by the Agreement) and costs and expenses in
defending against the same.
(ii) The Seller shall indemnify, defend, and hold harmless
the Trustee from and against any loss, liability, or expense incurred
by reason of (a) the Seller's willful misfeasance, bad faith, or
negligence (other than errors in judgment) in the performance of its
duties under the Agreement, or by reason of reckless disregard of its
obligations and duties under the Agreement and (b) the Seller's
violation of federal or state securities laws in connection with the
registration or the sale of the Certificates.
Indemnification under this Section 17.2 shall survive the
termination of this Agreement and shall include, without limitation, reasonable
fees and expenses of counsel and expenses of litigation. If the Seller shall
have made any indemnity payment to the Trustee pursuant to this Section and the
Trustee thereafter shall
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collect any of such amounts from others, the Trustee shall repay such amounts
to the Seller, without interest.
Section 17.3 Merger or Consolidation of, or Assumption of
the Obligations of, Seller. Any Person (i) into which the Seller may be merged
or consolidated, (ii) resulting from any merger, conversion, or consolidation
to which the Seller shall be a party, (iii) succeeding to the business of the
Seller, or (iv) more than 50% of the voting stock of which is owned directly
or indirectly by Ford Motor Company, which Person in any of the foregoing cases
executes an agreement of assumption to perform every obligation of the Seller
under this Agreement, will be the successor to the Seller under this Agreement
without the execution or filing of any document or any further act on the part
of any of the parties to this Agreement; provided, however, that (x) the Seller
shall have delivered to the Trustee an Officer's Certificate and an Opinion of
Counsel each stating that such consolidation, merger, or succession and such
agreement or assumption comply with this Section 17.3 and that all conditions
precedent, if any, provided for in the Agreement relating to such transaction
have been complied with and (y) the Seller shall have delivered to the Trustee
an Opinion of Counsel either (A) stating that, in the opinion of such Counsel,
all financing statements and continuation statements and amendments thereto
have been executed and filed that are necessary fully to preserve and protect
the interest of the Trustee in the Receivables, and reciting the details of
such filings, or (B) stating that, in the opinion of such Counsel, no such
action shall be necessary to preserve and protect such interest. The Seller
shall provide notice of any merger, consolidation, or succession pursuant to
this Section 17.3 to each rating agency then providing a rating for the
Certificates. Notwithstanding anything herein to the contrary, the execution
of the foregoing agreement or assumption and compliance with clauses (x) or (y)
above shall be conditions to the consummation of the transactions referred to
in clauses (i), (ii), or (iii) above.
Section 17.4 Limitation on Liability of Seller and Others.
The Seller and any director or officer or employee or agent of the Seller may
rely in good faith on the advice of counsel or on any document of any kind,
prima facie properly executed and submitted by any Person respecting any
matters arising hereunder. The Seller
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shall not be under any obligation to appear in, prosecute, or defend any legal
action that shall not be incidental to its obligations under the Agreement, and
that in its opinion may involve it in any expense or liability.
Section 17.5 Seller May Own Certificates. The Seller and
any Person controlling, controlled by, or under common control with the Seller
may in its individual or any other capacity become the owner or pledgee of
Certificates with the same rights as it would have if it were not the Seller or
an affiliate thereof, except as otherwise provided in the definition of
"Certificateholder" specified in Section 11.1 and except as otherwise
specifically provided herein. Certificates so owned by or pledged to the
Seller or such controlling or commonly controlled Person shall have an equal
and proportionate benefit under the provisions of the Agreement, without
preference, priority, or distinction as among all of the Certificates.
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ARTICLE ARTICLE XVIII
The Servicer
Section 18.1 Representations of Servicer. The Servicer
makes the following representations on which the Trustee relies in accepting
the Receivables in trust and executing and authenticating the Certificates.
The representations speak as of the execution and delivery of the Agreement and
shall survive the sale of the Receivables to the Trustee and, if applicable,
any subsequent assignment or transfer pursuant to Article XV:
(i) Organization and Good Standing. The Servicer shall have
been duly organized and shall be validly existing as a corporation in
good standing under the laws of the state of its incorporation, with
power and authority to own its properties and to conduct its business
as such properties shall be currently owned and such business is
presently conducted, and had at all relevant times, and shall have,
power, authority, and legal right to acquire, own, sell, and service
the Receivables and to hold the Receivable Files as custodian on
behalf of the Trustee;
(ii) Due Qualification. The Servicer shall be duly
qualified to do business as a foreign corporation in good standing,
and shall have obtained all necessary licenses and approvals in all
jurisdictions in which the ownership or lease of property or the
conduct of its business (including the servicing of the Receivables as
required by the Agreement) shall require such qualifications;
(iii) Power and Authority. The Servicer shall have the power
and authority to execute and deliver the Agreement and to carry out
its terms; and the execution, delivery, and performance of the
Agreement shall have been duly authorized by the Servicer by all
necessary corporate action;
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(iv) Binding Obligation. The Agreement shall constitute a
legal, valid, and binding obligation of the Servicer enforceable in
accordance with its terms;
(v) No Violation. The consummation of the transactions
contemplated by the Agreement and the fulfillment of the terms hereof
shall not conflict with, result in any breach of any of the terms and
provisions of, nor constitute (with or without notice or lapse of
time) a default under, the articles of incorporation or by-laws of
the Servicer, or any indenture, agreement, or other instrument to
which the Servicer is a party or by which it shall be bound; nor
result in the creation or imposition of any Lien upon any of its
properties pursuant to the terms of any such indenture, agreement, or
other instrument (other than the Agreement); 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; and
(vi) 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 the
Agreement or the Certificates, B) seeking to prevent the issuance of
the Certificates or the consummation of any of the transactions
contemplated by the Agreement, C) seeking any determination or ruling
that might materially and adversely affect the performance by the
Servicer of its obligations under, or the validity or enforceability
of, the Agreement or the Certificates, or D) relating to the Servicer
and which might adversely affect the federal income tax attributes of
the Certificates.
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Section 18.2 Indemnities of Servicer. The Servicer shall
be liable in accordance herewith only to the extent of the obligations
specifically undertaken by the Servicer under the Agreement.
(i) The Servicer shall defend, indemnify, and hold harmless
the Trustee, the Trust, and the Certificateholders from and against
any and all costs, expenses, losses, damages, claims, and liabilities,
arising out of or resulting from the use, ownership, or operation by
the Servicer or any affiliate thereof of a Financed Vehicle.
(ii) The Servicer shall indemnify, defend, and hold harmless
the Trustee and the Trust from and against any taxes that may at any
time be asserted against the Trustee or the Trust with respect to the
transactions contemplated herein, including, without limitation, any
sales, gross receipts, general corporation, tangible personal
property, privilege, or license taxes (but, in the case of the Trust,
not including any taxes asserted with respect to, and as of the date
of, the sale of the Receivables to the Trust or the issuance and
original sale of the Certificates, or asserted with respect to
ownership of the Receivables, or federal or other income taxes arising
out of the transactions contemplated by the Agreement) and costs and
expenses in defending against the same.
(iii) The Servicer shall indemnify, defend, and hold
harmless the Trustee, the Trust, and the Certificateholders from and
against any and all costs, expenses, losses, claims, damages, and
liabilities to the extent that such cost, expense, loss, claim,
damage, or liability arose out of, or was imposed upon the Trustee,
the Trust, or the Certificateholders through, the negligence, willful
misfeasance, or bad faith of the Servicer in the performance of its
duties under the Agreement or by reason of reckless disregard of its
obligations and duties under the Agreement.
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(iv) The Servicer shall indemnify, defend, and hold harmless
the Trustee from and against all costs, expenses, losses, claims,
damages, and liabilities arising out of or incurred in connection with
the acceptance or performance of the trusts and duties herein
contained, except to the extent that such cost, expense, loss, claim,
damage, or liability: (a) shall be due to the willful misfeasance,
bad faith, or negligence (except for errors in judgment) of the
Trustee; (b) relates to any tax other than the taxes with respect to
which either the Seller or the Servicer shall be required to
indemnify the Trustee; (c) shall arise from Trustee's breach of any of
its representations or warranties set forth in Section 20.14; (d)
shall be one as to which the Seller is required to indemnify the
Trustee; or (e) shall arise out of or be incurred in connection with
the performance by the Trustee of the duties of successor Servicer
hereunder.
In addition to the foregoing indemnities, if the Trustee is
entitled to indemnification by the Seller pursuant to Section 17.2 and the
Seller is unable for any reason to provide such indemnification to the Trustee,
then the Servicer shall be liable for any indemnification that the Trustee is
entitled to under Section 17.2.
For purposes of this Section, in the event of the termination
of the rights and obligations of Ford Motor Credit Company (or any successor
thereto pursuant to Section 18.3) as Servicer pursuant to Section 19.1, or a
resignation by such Servicer pursuant to this Agreement, such Servicer shall be
deemed to be the Servicer pending appointment of a successor Servicer (other
than the Trustee) pursuant to Section 19.2.
Indemnification under this Section 18.2 by Ford Motor Credit
Company (or any successor thereto pursuant to Section 18.3) as Servicer, with
respect to the period such Person was (or was deemed to be) the Servicer, shall
survive the termination of such Person as Servicer or a resignation by such
Person as Servicer as well as the termination of this Agreement and shall
include reasonable fees and expenses of counsel and expenses of litigation. If
the Servicer shall have made any indemnity
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payments pursuant to this Section and the recipient thereafter collects any of
such amounts from others, the recipient shall promptly repay such amounts to
the Servicer, without interest.
Section 18.3 Merger or Consolidation of, or Assumption of
the Obligations of, Servicer. Any Person (i) into which the Servicer may be
merged or consolidated, (ii) resulting from any merger, conversion, or
consolidation to which the Servicer shall be a party, or (iii) succeeding to
the business of the Servicer, or so long as Ford Motor Credit Company acts as
Servicer, any corporation more than 50% of the voting stock of which is owned
directly or indirectly by Ford Motor Company, which corporation in any of the
foregoing cases executes an agreement of assumption to perform every obligation
of the Servicer under this Agreement, will be the successor to the Servicer
under this Agreement without the execution or filing of any paper or any
further act on the part of any of the parties to this Agreement; provided,
however, that (x) the Servicer shall have delivered to the Trustee an Officer's
Certificate and an Opinion of Counsel each stating that such consolidation,
merger or succession and such agreement of assumption comply with this Section
18.3 and that all conditions precedent provided for in the Agreement relating
to such transaction have been complied with and (y) the Servicer shall have
delivered to the Trustee an Opinion of Counsel either (A) stating that, in the
opinion of such Counsel, all financing statements and continuation statements
and amendments thereto have been executed and filed that are necessary fully to
preserve and protect the interest of the Trustee in the Receivables, and
reciting the details of such filings, or (B) stating that, in the opinion of
such Counsel, no such action shall be necessary to preserve and protect such
interest. The Servicer shall provide notice of any merger, consolidation or
succession pursuant to this Section 18.3 to each rating agency then providing a
rating for the Certificates. Notwithstanding anything herein to the contrary,
the execution of the foregoing agreement or assumption and compliance with
clauses (x) or (y) above shall be conditions to the consummation of the
transactions referred to in clauses (i), (ii), or (iii) above.
Section 18.4 Limitation on Liability of Servicer and
Others. Neither the Servicer nor any of the
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directors or officers or employees or agents of the Servicer shall be under any
liability to the Trust or the Certificateholders, except as provided under the
Agreement, for any action taken or for refraining from the taking of any action
pursuant to the Agreement or for errors in judgment; provided, however, that
this provision shall not protect the Servicer or any such person against any
liability that would otherwise be imposed by reason of willful misfeasance or
bad faith in the performance of duties or by reason of reckless disregard of
obligations and duties under the Agreement, or by reason of negligence in the
performance of its duties under the Agreement (except for errors in judgment).
The Servicer and any director, officer or employee or agent of the Servicer may
rely in good faith on any Opinion of Counsel or on any Officer's Certificate or
certificate of auditors believed to be genuine and to have been signed by the
proper party in respect of any matters arising under this Agreement.
Except as provided in the Agreement, the Servicer shall not be
under any obligation to appear in, prosecute, or defend any legal action that
shall not be incidental to its duties to service the Receivables in accordance
with the 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 the Agreement and
the rights and duties of the parties to the Agreement and the interests of the
Certificateholders under the Agreement. In such event, the legal expenses and
costs of such action and any liability resulting therefrom shall be expenses,
costs, and liabilities of the Servicer.
Section 18.5 Delegation of Duties. So long as Ford Motor
Credit Company acts as Servicer, the Servicer may at any time without notice or
consent delegate substantially all its duties under this Agreement to any
corporation more than 50% of the voting stock of which is owned, directly or
indirectly, by Ford Motor Company. The Servicer may at any time perform
specific duties as servicer under the Agreement through sub-contractors;
provided that no such delegation or subcontracting shall relieve the Servicer
of its responsibilities with respect to such duties as to which the Servicer
shall remain primarily responsible with respect thereto.
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ARTICLE XIX
Default
Section 19.1 Events of Default. If any one of the
following events ("Events of Default") shall occur and be continuing:
(i) Any failure by the Servicer to deliver to the Trustee
for distribution to Certificateholders or deposit in the Subordination
Spread Account any proceeds or payment required to be so delivered
under the terms of the Certificates and the Agreement that shall
continue unremedied for a period of three Business Days after written
notice of such failure is received by the Servicer from the Trustee or
after discovery of such failure by an officer of the Servicer; or
(ii) Failure on the part of the Servicer or the Seller duly
to observe or to perform in any material respect any other covenants
or agreements of the Servicer or the Seller (as the case may be) set
forth in the Certificates or in the Agreement, which failure shall (a)
materially and adversely affect the rights of Certificateholders and
(b) continue unremedied for a period of 90 days after the date on
which written notice of such failure, requiring the same to be
remedied, shall have been given (1) to the Servicer or the Seller (as
the case may be), by the Trustee, or (2) to the Servicer or the Seller
(as the case may be), and to the Trustee by the Holders of Class A
Certificates evidencing not less than 25% of the Class A Certificate
Balance; or
(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 respective
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affairs, and the continuance of any such decree or order unstayed and
in effect for a period of 90 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 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;
then, and in each and every case, so long as an Event of Default shall not have
been remedied, either the Trustee, or the Holders of the Class A Certificates
evidencing not less than 51% of the Class A Certificate Balance, by notice then
given in writing to the Servicer (and to the Trustee if given by the
Certificateholders) (with a copy to each rating agency requested to provide a
rating on the Certificates) may terminate all of the rights and obligations of
the Servicer under the Agreement. On or after the receipt by the Servicer of
such written notice, all authority and power of the Servicer under the
Agreement, whether with respect to the Certificates or the Receivables or
otherwise, shall, without further action, pass to and be vested in the Trustee
or such successor Servicer as may be appointed under Section 19.2; and, without
limitation, the Trustee is 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 Receivables and related documents, or otherwise.
The predecessor Servicer shall cooperate with the successor
Servicer and the Trustee in effecting the termination of the responsibilities
and rights of the predecessor Servicer under the Agreement, including the
transfer to the successor Servicer for administration by
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it of all cash amounts that shall at the time be held by the predecessor
Servicer for deposit, or shall thereafter be received with respect to a
Receivable and the delivery of the Receivable Files, and the related accounts
and records maintained by the Servicer. All reasonable costs and expenses
(including attorneys' fees) incurred in connection with transferring the
Receivable Files to the successor Servicer and amending the Agreement to
reflect such succession as Servicer pursuant to this Section 19.1 shall be paid
by the predecessor Servicer upon presentation of reasonable documentation of
such costs and expenses.
Section 19.2 Appointment of Successor. (a) Upon the
Servicer's receipt of notice of termination pursuant to Section 19.1 or the
Servicer's resignation in accordance with the terms of the Agreement, the
predecessor Servicer shall continue to perform its functions as Servicer
under the Agreement, in the case of termination, only until the date specified
in such termination notice or, if no such date is specified in a notice of
termination, until receipt of such notice and, in the case of resignation,
until the later of (x) the date 45 days from the delivery to the Trustee of
written notice of such resignation (or written confirmation of such notice) in
accordance with the terms of the Agreement and (y) the date upon which the
predecessor Servicer shall become unable to act as Servicer, as specified in
the notice of resignation and accompanying Opinion of Counsel. In the event of
the Servicer's resignation or termination hereunder, the Trustee shall appoint
a successor Servicer, and the successor Servicer shall accept its appointment
by a written assumption in form acceptable to the Trustee. In the event that a
successor Servicer has not been appointed at the time when the predecessor
Servicer has ceased to act as Servicer in accordance with this Section 19.2,
the Trustee without further action shall automatically be appointed the
successor Servicer. Notwithstanding the above, the Trustee shall, if it shall
be legally unable so to act, appoint, or petition a court of competent
jurisdiction to appoint, any established institution, having a net worth of not
less than $100,000,000 and whose regular business shall include the servicing
of automotive receivables, as the successor to the Servicer under the
Agreement.
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(b) Upon appointment, the successor Servicer shall
be the successor in all respects to the predecessor Servicer and shall be
subject to all the responsibilities, duties, and liabilities arising thereafter
relating thereto placed on the predecessor Servicer, and shall be entitled to
the Servicer Fees and all of the rights granted to the predecessor Servicer, by
the terms and provisions of the Agreement.
(c) In connection with such appointment, the
Trustee may make such arrangements for the compensation of such successor
Servicer out of payments on Receivables as it and such successor Servicer shall
agree; provided, however, that no such compensation shall be in excess of that
permitted the predecessor Servicer under the Agreement. The Trustee and
such successor Servicer shall take such action, consistent with the Agreement,
as shall be necessary to effectuate any such succession.
Section 19.3 Repayment of Advances. If the identity of the
Servicer shall change, the predecessor Servicer shall be entitled to receive to
the extent of available funds reimbursement for Outstanding Advances pursuant
to Section 14.3 and 14.4, in the manner specified in Section 14.6, with
respect to all Advances made by the predecessor Servicer.
Section 19.4 Notification to Certificateholders. Upon any
termination of, or appointment of a successor to, the Servicer pursuant to this
Article XIX, the Trustee shall give prompt written notice thereof to
Certificateholders at their respective addresses appearing in the Certificate
Register and to each of the rating agencies then rating the Certificates.
Section 19.5 Waiver of Past Defaults. The Holders of
Class A Certificates evidencing not less than 51% of the Class A Certificate
Balance may, on behalf of all Holders of Certificates, waive any default by the
Servicer in the performance of its obligations hereunder and its consequences,
except a default in making any required deposits to or payments from the
Collection Account or the Certificate Account in accordance with the
Agreement. Upon any such waiver of a past default, such default shall cease to
exist, and any Event of Default arising therefrom shall be deemed to have been
remedied for every purpose of the Agreement. No such waiver shall
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extend to any subsequent or other default or impair any right consequent
thereon.
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ARTICLE XX
The Trustee
Section 20.1 Duties of Trustee. The Trustee, both prior to
the occurrence of an Event of Default and after an Event of Default shall have
been cured or waived, shall undertake to perform such duties as are
specifically set forth in the Agreement. If an Event of Default shall
have occurred and shall not have been cured or waived and, in the case of an
Event of Default described in Section 19.1, the Trustee has received notice of
such Event of Default pursuant to Section 13.10(b), the Trustee shall exercise
such of the rights and powers vested in it by the Agreement, and shall use the
same degree of care and skill in their exercise, as a prudent person would
exercise or use under the circumstances in the conduct of his own affairs;
provided, however, that if the Trustee shall assume the duties of the Servicer
pursuant to Section 19.2, the Trustee in performing such duties shall use the
degree of skill and attention customarily exercised by a servicer with respect
to automobile receivables that it services for itself or others.
The Trustee, upon receipt of all resolutions, certificates,
statements, opinions, reports, documents, orders, or other instruments
furnished to the Trustee that shall be specifically required to be furnished
pursuant to any provision of the Agreement, shall examine them to determine
whether they conform to the requirements of the Agreement.
The Trustee shall take and maintain custody of the Schedule of
Receivables included as an exhibit to the Agreement and shall retain all
Servicer's Certificates identifying Receivables that become Purchased
Receivables.
No provision of the Agreement shall be construed to relieve
the Trustee from liability for its own negligent action, its own negligent
failure to act (other than errors in judgment), or its own bad faith; provided,
however, that:
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(i) Prior to the occurrence of an
Event of Default, and after the curing or waiving of
all such Events of Default that may have
occurred, the duties and obligations of the Trustee
shall be determined solely by the express provisions
of the Agreement, the Trustee shall not be liable
except for the performance of such duties and
obligations as shall be specifically set forth in the
Agreement, no implied covenants or obligations shall
be read into the Agreement against the Trustee and,
in the absence of bad faith on the part of the
Trustee, the Trustee may conclusively rely on the
truth of the statements and the correctness of the
opinions expressed upon any certificates or opinions
furnished to the Trustee and conforming to the
requirements of the Agreement;
(ii) The Trustee shall not be liable
for an error of judgment made in good faith by a
Trustee Officer, unless it shall be proved that
the Trustee shall have been negligent in ascertaining
the pertinent facts;
(iii) The Trustee shall not be
liable with respect to any action taken, suffered, or
omitted to be taken in good faith in
accordance with the Agreement or at the direction
of the Holders of Class A Certificates evidencing
not less than 25% of the Class A Certificate
Balance relating to the time, method, and place of
conducting any proceeding for any remedy available to
the Trustee, or exercising any trust or power
conferred upon the Trustee, under the Agreement;
(iv) The Trustee shall not be
charged with knowledge of any failure by the Servicer
to comply with the obligations of the Servicer
referred to in Section 19.1, or of any failure by the
Seller to comply with the obligations of the Seller
referred to in Section 19.1, unless a Trustee Officer
assigned to the Trustee's Corporate Trust Department
obtains actual knowledge of such failure (it being
understood that knowledge of the Servicer or the
Servicer as custodian, in its capacity as
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agent for the Trustee, is not attributable to
the Trustee) or the Trustee receives written
notice of such failure from the Servicer or
the Seller, as the case may be, or the Holders of
Class A Certificates evidencing not less than 25% of
the Class A Certificate Balance; and
(v) Without limiting the generality
of this Section or Section 20.4, the Trustee shall
have no duty (i) to see to any recording, filing, or
depositing of the Agreement, any agreement referred
to therein, or any financing statement or
continuation statement evidencing a security
interest in the Receivables or the Financed Vehicles,
or to see to the maintenance of any such recording,
filing, or depositing or to any rerecording, refiling
or redepositing of any thereof, (ii) to see to any
insurance of the Financed Vehicles or Obligors or to
effect or maintain any such insurance, (iii) to see
to the payment or discharge of any tax, assessment,
or other governmental charge or any Lien or
encumbrance of any kind owing with respect to,
assessed or levied against, any part of the Trust,
(iv) to confirm or verify the contents of any reports
or certificates of the Servicer delivered to the
Trustee pursuant to the Agreement believed by the
Trustee to be genuine and to have been signed or
presented by the proper party or parties, or (v) to
inspect the Financed Vehicles at any time or
ascertain or inquire as to the performance or
observance of any of the Seller's or the Servicer's
representations, warranties, or covenants or the
Servicer's duties and obligations as Servicer and as
custodian of the Receivable Files under the
Agreement.
The Trustee shall not be required to expend or risk its own
funds or otherwise incur financial liability in the performance of any of its
duties hereunder, or in the exercise of any of its rights or powers, if there
shall be reasonable ground for believing that the repayment of such funds or
adequate indemnity against such risk or liability shall not be reasonably
assured to it, and none of the provisions contained in the Agreement
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shall in any event require the Trustee to perform, or be responsible for the
manner of performance of, any of the obligations of the Servicer under the
Agreement except during such time, if any, as the Trustee shall be the
successor to, and be vested with the rights, duties, powers, and privileges of,
the Servicer in accordance with the terms of the Agreement.
Section 20.2 Trustee's Certificate. Upon request of the
Seller or Servicer, on or as soon as practicable after each Distribution Date
on which Receivables shall be assigned to the Seller or the Servicer, as
applicable, pursuant to Section 20.3, the Trustee shall execute a
Trustee's Certificate (in the form of Exhibit D-1 or D-2, as applicable), based
on the information contained in the Servicer's Certificate for the related
Collection Period, amounts deposited to the Certificate Account and notices
received pursuant to the Agreement, identifying the Receivables repurchased by
the Seller pursuant to Section 12.2 or purchased by the Servicer pursuant to
Section 13.7 or 21.2 during such Collection Period, and shall deliver such
Trustee's Certificate, accompanied by a copy of the Servicer's Certificate for
such Collection Period to the Seller or the Servicer, as the case may be. The
Trustee's Certificate submitted with respect to such Distribution Date shall
operate, as of such Distribution Date, as an assignment, without recourse,
representation, or warranty, to the Seller or the Servicer, as the case may be,
of all the Trustee's right, title, and interest in and to such repurchased
Receivable, and all security and documents relating thereto, such assignment
being an assignment outright and not for security.
Section 20.3 Trustee's Assignment of Purchased Receivables.
With respect to all Receivables repurchased by the Seller pursuant to Section
12.2 or purchased by the Servicer pursuant to Section 13.7 or 21.2, the
Trustee shall by a Trustee's Certificate (in the form of Exhibit D-1 or D-2, as
applicable) assign, without recourse, representation, or warranty, to the
Seller or the Servicer (as the case may be) all the Trustee's right, title, and
interest in and to such Receivables, and all security and documents relating
thereto.
Section 20.4 Certain Matters Affecting Trustee.
Except as otherwise provided in Section 20.1:
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(i) The Trustee may rely and shall
be protected in acting or refraining from acting upon
any resolution, Officer's Certificate, Servicer's
Certificate, certificate of auditors, or any other
certificate, statement, instrument, opinion, report,
notice, request, consent, order, appraisal, bond, or
other paper or document believed by it to be genuine
and to have been signed or presented by the proper
party or parties.
(ii) The Trustee may consult with
counsel and any Opinion of Counsel shall be full and
complete authorization and protection in respect
of any action taken or suffered or omitted by it
under the Agreement in good faith and in accordance
with such Opinion of Counsel.
(iii) The Trustee shall be under no
obligation to exercise any of the rights or powers
vested in it by the Agreement, or to institute,
conduct, or defend any litigation under the
Agreement or in relation to the Agreement, at the
request, order, or direction of any of the
Certificateholders pursuant to the provisions of the
Agreement, unless such Certificateholders shall have
offered to the Trustee reasonable security or
indemnity against the costs, expenses, and
liabilities that may be incurred therein or thereby;
nothing contained in the Agreement, however, shall
relieve the Trustee of the obligations, upon the
occurrence of an Event of Default (that shall not
have been cured or waived), to exercise such of the
rights and powers vested in it by the Agreement, and
to use the same degree of care and skill in their
exercise as a prudent man would exercise or use under
the circumstances in the conduct of his own affairs.
(iv) The Trustee shall not be liable
for any action taken, suffered or omitted by it
in good faith and reasonably believed by it to be
authorized or within the discretion or rights or
powers conferred upon it by the Agreement.
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(v) Prior to the occurrence of an
Event of Default and after the curing or waiving of
all Events of Default that may have occurred, the
Trustee shall not be bound to make any investigation
into the facts of matters stated in any
resolution, certificate, statement, instrument,
opinion, report, notice, request, consent, order,
approval, bond, or other paper or document, unless
requested in writing so to do by Holders of Class A
Certificates evidencing not less than 25% of the
Class A Certificate Balance; provided, however, that
if the payment within a reasonable time to the
Trustee of the costs, expenses, or liabilities likely
to be incurred by it in the making of such
investigation shall be, in the opinion of the
Trustee, not reasonably assured to the Trustee by the
security afforded to it by the terms of the
Agreement, the Trustee may require reasonable
indemnity against such cost, expense, or liability as
a condition to so proceeding. The reasonable expense
of every such examination shall be paid by the
Servicer or, if paid by the Trustee, shall be
reimbursed by the Servicer upon demand. Nothing in
this clause (v) shall affect the obligation of the
Servicer to observe any applicable law prohibiting
disclosure of information regarding the Obligors.
(vi) The Trustee may execute any of
the trusts or powers hereunder or perform any duties
under the Agreement either directly or by or through
agents or attorneys or a custodian. The Trustee
shall not be responsible for any misconduct or
negligence of any such agent or custodian appointed
with due care by it hereunder or of the Servicer in
its capacity as Servicer or custodian.
(vii) Subsequent to the sale of the
Receivables by the Seller to the Trustee, the Trustee
shall have no duty of independent inquiry, except as
may be required by Section 20.1, and the Trustee may
rely upon the representations and warranties and
covenants of the Seller and the Servicer contained in
the Agree-
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ment with respect to the Receivables and the
Receivable Files.
Section 20.5 Trustee Not Liable for Certificates or
Receivables. The recitals contained herein and in the Certificates (other than
the certificate of authentication on the Certificates) shall be taken as the
statements of the Seller or the Servicer, as the case may be, and the Trustee
assumes no responsibility for the correctness thereof. The Trustee shall make
no representations as to the validity or sufficiency of the Agreement or of the
Certificates (other than the certificate of authentication on the
Certificates), or of any Receivable or related document. The Trustee shall at
no time have any responsibility or liability for or with respect to the
legality, validity, and enforceability of any security interest in any Financed
Vehicle or any Receivable, or the perfection and priority of such a security
interest or the maintenance of any such perfection and priority, or for or with
respect to the efficacy of the Trust or its ability to generate the payments to
be distributed to Certificateholders under the Agreement, including, without
limitation: the existence, condition, location, and ownership of any Financed
Vehicle; the review of any Receivable File therefor; the existence and
enforceability of any physical damage insurance thereon; the existence and
contents of any Receivable or any Receivable File or any computer or other
record thereof; the validity of the assignment of any Receivable to the Trust
or of any intervening assignment; the completeness of any Receivable or any
Receivable File; the performance or enforcement of any Receivable; the
compliance by the Seller or the Servicer with any warranty or representation
made under the Agreement or in any related document and the accuracy of any
such warranty or representation prior to the Trustee's receipt of notice or
other discovery of any noncompliance therewith or any breach thereof; any
investment of monies by the Servicer or any loss resulting therefrom (it being
understood that the Trustee shall remain responsible for any Trust property
that it may hold); the acts or omissions of the Seller, the Servicer, or any
Obligor; an action of the Servicer taken in the name of the Trustee; or any
action by the Trustee taken at the instruction of the Servicer; provided,
however, that the foregoing shall not relieve the Trustee of its obligation to
perform its duties under the Agreement. Except with respect to a claim based
on the fail-
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ure of the Trustee to perform its duties under the Agreement or based on the
Trustee's negligence or willful misconduct, no recourse shall be had for any
claim based on any provision of the Agreement, the Certificates, or any
Receivable or assignment thereof against the Trustee in its individual
capacity, the Trustee shall not have any personal obligation, liability, or
duty whatsoever to any Certificateholder or any other Person with respect to
any such claim, and any such claim shall be asserted solely against the Trust
or any indemnitor who shall furnish indemnity as provided in the Agreement.
The Trustee shall not be accountable for the use or application by the Seller
of any of the Certificates or of the proceeds of such Certificates, or for the
use or application of any funds paid to the Servicer in respect of the
Receivables. Any obligation of the Trustee to give any notice or statement to
any rating agency hereunder shall constitute only a best efforts obligation and
such notice or statement shall be so provided only as a matter of courtesy and
accommodation, the Trustee having no liability to any rating agency or any
other Person for any failure to so provide such notice or statement. The
Trustee may rely on the accuracy of such certification until it receives from
the Seller an Officer's Certificate superseding such certification.
Section 20.6 Trustee May Own Certificates. The Trustee in
its individual or any other capacity may become the owner or pledgee of
Certificates and may deal with the Seller and the Servicer in banking
transactions with the same rights as it would have if it were not Trustee.
Section 20.7 Trustee's Fees and Expenses. The Servicer
shall pay to the Trustee, and the Trustee shall be entitled to, reasonable
compensation (which shall not be limited by any provision of law in regard to
the compensation of a trustee of an express trust) for all services rendered by
it in the execution of the trusts created by the Agreement and in the exercise
and performance of any of the Trustee's powers and duties under the Agreement,
and the Servicer, shall pay or reimburse the Trustee upon its request for all
reasonable expenses, disbursements, and advances (including the reasonable
compensation and the expenses and disbursements of its counsel and of all
persons not regularly in its employ) incurred or made by the Trustee in
accordance with any
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provisions of the Agreement except any such expense, disbursement, or advance
as may be attributable to its willful misfeasance, negligence, or bad faith,
and the Servicer shall indemnify the Trustee for, and hold it harmless against
any loss, liability, or expense incurred without willful misfeasance,
negligence, or bad faith on its part, arising out of or in connection with the
acceptance or administration of the Trust, including the costs and expenses of
defending itself against any claim or liability in connection with the exercise
or performance of any of its powers or duties under the Agreement.
Additionally, the Seller, pursuant to Section 17.2, and the Servicer, pursuant
to Section 18.2, respectively, shall indemnify the Trustee with respect to
certain matters, and Certificateholders, pursuant to Section 20.4 shall, upon
the circumstances therein set forth, indemnify the Trustee under certain
circumstances. The provisions of this Section 20.7 shall survive the
termination of this Agreement.
Section 20.8 Indemnity of Trustee and Class A Agent. The
Trustee shall be indemnified by the Servicer and held harmless against any
loss, liability, fee, disbursement, or expense (including any compensation or
expense referred to in Section 20.7) arising out of or incurred in connection
with the acceptance or performance of the trusts and duties contained in the
Agreement to the extent that (i) the Trustee shall not be entitled to indemnity
for such loss, liability, fee, disbursement, or expense by the Seller pursuant
to Section 17.2 or Section 20.7, the Servicer pursuant to Section 18.2, or the
Certificateholders pursuant to Section 20.4; (ii) such loss, liability, fee,
disbursement, or expense shall not have been incurred by reason of the
Trustee's willful misfeasance, bad faith, or negligence (except for errors in
judgment); and (iii) such loss, liability, fee, disbursement, or expense shall
not have been incurred by reason of the Trustee's breach of its representations
and warranties pursuant to Section 20.14. The Class A Agent shall be
indemnified by the Servicer and held harmless against any loss, liability, fee,
disbursement, or expense arising out of or incurred in connection with the
acceptance or performance of its duties contained in the Agreement except to
the extent that such loss, liability, fee, disbursement, or expense shall have
been incurred by reason of the Class A Agent's willful misfeasance or gross
negligence; provided, however, that notwithstanding
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the foregoing, the Class A Agent shall be entitled to indemnification pursuant
to this Section 20.8 with respect to any actions of the Class A Agent taken in
accordance with the written instructions of the Servicer or of the Trustee
pursuant to Sections 14.7(d)(i) or 14.7(d)(ii).
Section 20.9 Eligibility Requirements for Trustee. The
Trustee under the Agreement shall at all times be a corporation having an
office in the same state as the location of the Corporate Trust Office as
specified in the Agreement; organized and doing business under the laws of such
state or the United States of America; authorized under such laws to exercise
corporate trust powers; and having a combined capital and surplus of at least
$50,000,000 and 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 20.9, 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 Trustee shall cease to be eligible in
accordance with the provisions of this Section 20.9, the Trustee shall resign
immediately in the manner and with the effect specified in Section 20.10.
Section 20.10 Resignation or Removal of Trustee. The
Trustee may at any time resign and be discharged from the trusts hereby created
by giving written notice thereof to the Servicer. Upon receiving such notice
of resignation, the Servicer shall promptly appoint a successor Trustee by
written instrument, in duplicate, one copy of which instrument shall be
delivered to the resigning Trustee and one copy to the successor Trustee. If
no successor Trustee shall have been so appointed and have accepted appointment
within 30 days after the giving of such notice of resignation, the resigning
Trustee may petition any court of competent jurisdiction for the appointment of
a successor Trustee.
If at any time the Trustee shall cease to be eligible in
accordance with the provisions of Section 20.9 and shall fail to resign after
written request therefor by the Servicer, or if at any time the Trustee
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shall be legally unable to act, or shall be adjudged bankrupt or insolvent, or
a receiver of the trustee or of its property shall be appointed, or any public
officer shall take charge or control of the Trustee or of its property or
affairs for the purpose of rehabilitation, conservation, or liquidation, then
the Servicer may remove the Trustee. If it shall remove the Trustee under the
authority of the immediately preceding sentence, the Servicer shall promptly
appoint a successor Trustee by written instrument, in duplicate, one copy of
which instrument shall be delivered to the Trustee so removed and one copy to
the successor Trustee and shall promptly pay all fees owed to the outgoing
Trustee.
Any resignation or removal of the Trustee and appointment of a
successor Trustee pursuant to any of the provisions of this Section 20.10 shall
not become effective until acceptance of appointment by the successor Trustee
pursuant to Section 20.11 and payment of all fees and expenses owed and any
other amounts due hereunder to the outgoing Trustee. The Servicer shall
provide notice of such resignation or removal of the Trustee to each of the
rating agencies then rating the Certificates.
Section 20.11 Successor Trustee. Any successor Trustee
appointed pursuant to Section 20.10 shall execute, acknowledge, and deliver to
the Servicer and to its predecessor Trustee an instrument accepting such
appointment under the Agreement, and thereupon the resignation or removal
of the predecessor Trustee shall become effective and such successor Trustee,
without any further act, deed, or conveyance, shall become fully vested with
all the rights, powers, duties, and obligations of its predecessor under the
Agreement, with like effect as if originally named as Trustee. The predecessor
Trustee shall upon payment of its fees and expenses and any other amounts due
it hereunder deliver to the successor Trustee all documents and statements and
monies held by it under the Agreement; and the Servicer and the predecessor
Trustee shall execute and deliver such instruments and do such other things as
may reasonably be required for fully and certainly vesting and confirming in
the successor Trustee all such rights, powers, duties, and obligations.
No successor Trustee shall accept appointment as provided in
this Section 20.11 unless at the time of
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such acceptance such successor Trustee shall be eligible pursuant to Section
20.9.
Upon acceptance of appointment by a successor Trustee pursuant
to this Section 20.11, the Servicer shall mail notice of the successor of such
Trustee under the Agreement to all Holders of Certificates at their addresses
as shown in the Certificate Register. If the Servicer shall fail to mail such
notice within 10 days after acceptance of appointment by the successor Trustee,
the successor Trustee shall cause such notice to be mailed at the expense of
the Servicer.
Section 20.12 Merger or Consolidation of Trustee. Any
corporation into which the Trustee may be merged or converted or with which it
may be consolidated, or any corporation resulting from any merger, conversion,
or consolidation to which the Trustee shall be a party, or any corporation
succeeding to all or substantially all of the corporate trust business of the
Trustee, shall be the successor of the Trustee hereunder, provided such
corporation shall be eligible pursuant to Section 20.9, without the execution
or filing of any instrument or any further act on the part of any of the
parties hereto; anything herein to the contrary notwithstanding.
Section 20.13 Appointment of Co-Trustee or Separate
Trustee. Notwithstanding any other provisions of the Agreement, at any time,
for the purpose of meeting any legal requirements of any jurisdiction in which
any part of the Trust or any Financed Vehicle may at the time be located, the
Servicer and the Trustee acting jointly shall have the power and shall execute
and deliver all instruments to appoint one or more Persons approved by the
Trustee to act as co-trustee, jointly with the Trustee, or separate trustee or
separate trustees, of all or any part of the Trust, and to vest in such Person,
in such capacity and for the benefit of the Certificateholders, such title to
the Trust, or any part thereof, and, subject to the other provisions of this
Section 20.13, such powers, duties, obligations, rights, and trusts as the
Servicer and the Trustee may consider necessary or desirable. If the Servicer
shall not have joined in such appointment within 15 days after the receipt by
it of a request so to do, or in the case an Event of Default shall have
occurred and be continuing, the Trustee alone shall have the power to make such
appointment. No co-
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trustee or separate trustee under the Agreement shall be required to meet the
terms of eligibility as a successor trustee pursuant to Section 20.9 and no
notice of a successor trustee pursuant to Section 20.11 and no notice to
Certificateholders of the appointment of any co-trustee or separate trustee
shall be required pursuant to Section 20.11.
Each separate trustee and co-trustee shall, to the extent
permitted by law, be appointed and act subject to the following provisions and
conditions:
(i) All rights, powers, duties, and obligations conferred or
imposed upon the Trustee shall be conferred upon and exercised or
performed by the Trustee and such separate trustee or co-trustee
jointly (it being understood that such separate trustee or co-trustee
is not authorized to act separately without the Trustee joining in
such act), except to the extent that under any law of any jurisdiction
in which any particular act or acts are to be performed (whether as
Trustee under the Agreement or as successor to the Servicer under the
Agreement), the Trustee shall be incompetent or unqualified to perform
such act or acts, in which event such rights, powers, duties, and
obligations (including the holding of title to the Trust or any
portion thereof in any such jurisdiction) shall be exercised and
performed singly by such separate trustee or co-trustee, but solely at
the direction of the Trustee;
(ii) No trustee under the Agreement shall be personally
liable by reason of any act or omission of any other trustee under the
Agreement;
(iii) The Servicer and the Trustee acting jointly may at any
time accept the resignation of or remove any separate trustee or
co-trustee; and
(iv) All duties owed hereunder to the Trustee by the
Servicer shall be deemed to be owed to each separate trustee and
co-trustee.
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Any notice, request, or other writing given to the Trustee
shall be deemed to have been given to each of the then separate trustees and
co-trustees, as effectively as if given to each of them. Every instrument
appointing any separate trustee or co-trustee shall refer to the Agreement and
the conditions of this Article XX. Each separate trustee and co-trustee, upon
its acceptance of the trusts conferred, shall be vested with the estates or
property specified in its instrument of appointment, either jointly with the
Trustee or separately, as may be provided therein, subject to all the
provisions of the Agreement, specifically including every provision of the
Agreement relating to the conduct of, affecting the liability of, or affording
protection to, the Trustee. Each such instrument shall be filed with the
Trustee and a copy thereof given to the Servicer.
Any separate trustee or co-trustee may at any time appoint the
Trustee, its agent or attorney-in-fact with full power and authority, to the
extent not prohibited by law, to do any lawful act under or in respect of the
Agreement on its behalf and in its name. If any separate trustee or co-trustee
shall die, become incapable of acting, resign, or be removed, all of its
estates, properties, rights, remedies, and trusts shall vest in and be
exercised by the Trustee, to the extent permitted by law, without the
appointment of a new or successor trustee.
Section 20.14 Representations and Warranties of Trustee.
The Trustee shall make the following representations and warranties on which
the Seller and Certificateholders shall rely:
(i) The Trustee is a New York corporation duly organized,
validly existing, and in good standing under the laws of the State of
New York.
(ii) The Trustee has full corporate power, authority, and
legal right to execute, deliver, and perform the Agreement, and shall
have taken all necessary action to authorize the execution, delivery,
and performance by it of the Agreement.
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(iii) The Agreement shall have been duly executed and
delivered by the Trustee.
Section 20.15 Tax Returns. The Servicer shall prepare or
shall cause to be prepared any tax returns required to be filed by the Trust
and shall remit such returns to the Trustee for signature at least five days
before such returns are due to be filed. The Trustee, upon request, will
furnish the Servicer with all such information known to the Trustee as may be
reasonably required in connection with the preparation of all tax returns of
the Trust, and shall, upon request, execute such returns.
Section 20.16 Trustee May Enforce Claims Without
Possession of Certificates. All rights of action and claims under this
Agreement or the Certificates may be prosecuted and enforced by the Trustee
without the possession of any of the Certificates or the production thereof in
any proceeding relating thereto, and any such proceeding instituted by the
Trustee shall be brought in its own name as trustee. Any recovery of judgment
shall, after provision for the payment of the reasonable compensation,
expenses, disbursements, and advances of the Trustee, its agents and counsel,
be for the ratable benefit of the Certificateholders in respect of which such
judgment has been obtained.
Section 20.17 Suits for Enforcement. If an Event of
Default shall occur and be continuing, the Trustee, in its discretion may,
subject to the provisions of Section 20.1, proceed to protect and enforce its
rights and the rights of the Certificateholders under this Agreement by a suit,
action, or proceeding in equity or at law or otherwise, whether for the
specific performance of any covenant or agreement contained in this Agreement
or in aid of the execution of any power granted in this Agreement or for the
enforcement of any other legal, equitable, or other remedy as the Trustee,
being advised by counsel, shall deem most effectual to protect and enforce any
of the rights of the Trustee or the Certificateholders.
Section 20.18 Rights of Certificateholders to Direct
Trustee. Holders of Class A Certificates evidencing not less than 51% of the
Class A Certificate Balance
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shall have the right to direct the time, method, and place of conducting any
proceeding for any remedy available to the Trustee, or exercising any trust or
power conferred on the Trustee; provided, however, that, subject to Section
20.1, the Trustee shall have the right to decline to follow any such direction
if the Trustee being advised by counsel determines that the action so directed
may not lawfully be taken, or if the Trustee in good faith shall, by a Trustee
Officer, determine that the proceedings so directed would be illegal or subject
it to personal liability or be unduly prejudicial to the rights of
Certificateholders not parties to such direction; and provided further that
nothing in this Agreement shall impair the right of the Trustee to take any
action deemed proper by the Trustee and which is not inconsistent with such
direction by the Certificateholders.
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ARTICLE XXI
Termination
Section 21.1 Termination of the Trust. The respective
obligations and responsibilities of the Seller, the Servicer, and the Trustee
created hereby and the Trust created by the Agreement shall terminate upon (i)
the purchase as of the last day of any Collection Period by the Servicer at its
option, pursuant to Section 21.2, of the corpus of the Trust and the subsequent
distribution to Certificateholders pursuant to Section 14.6 of the amount
required to be deposited pursuant to Section 21.2 or (ii) the payment to
Certificateholders of all amounts required to be paid to them pursuant to the
Agreement and the disposition of all property held as part of the Trust;
provided, however, that in no event shall the trust created by the Agreement
continue beyond the expiration of 21 years from the death of the last survivor
of the descendants of Hurley David Smith, currently residing in Clarkston,
Michigan, living on the date of the Agreement. The Servicer shall promptly
notify the Trustee of any prospective termination pursuant to this Section
21.1.
Notice of any termination, specifying the Distribution Date
upon which the Certificateholders may surrender their Certificates to the
Trustee for payment of the final distribution and cancellation, shall be given
promptly by the Trustee by letter to Certificateholders mailed not earlier than
the 15th day and not later than the 25th day of the month next preceding the
specified Distribution Date stating (A) the Distribution Date upon which final
payment of the Certificates shall be made upon presentation and surrender of
the Certificates at the office of the Trustee therein designated, (B) the
amount of any such final payment, and (C) if applicable, that the Record Date
otherwise applicable to such Distribution Date is not applicable, payments
being made only upon presentation and surrender of the Certificates at the
office of the Trustee therein specified. The Trustee shall give such notice to
the Certificate Registrar (if other than the Trustee) at the time such notice
is given to Certificateholders. Upon presentation and surrender of the
Certificates, the Trustee shall cause to be distributed to Certificateholders
amounts
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distributable on such Distribution Date pursuant to Section 14.6.
In the event that all of the Certificateholders shall not
surrender their Certificates for cancellation within six months after the date
specified in the above-mentioned written notice, the Trustee shall give a
second written notice to the remaining Certificateholders 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 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 the Agreement. Any funds remaining in the Trust after
exhaustion of such remedies shall be distributed by the Trustee to the Edison
Institute, Dearborn, Michigan.
Section 21.2 Optional Purchase of All Receivables. On the
last day of any Collection Period as of which the Pool Factor shall be less
than the Optional Purchase Percentage, the Servicer shall have the option to
purchase the corpus of the Trust. To exercise such option, the Servicer
shall deposit pursuant to Section 14.5 in the Collection Account an amount
equal to the aggregate Purchase Amount for the Receivables, plus the appraised
value of any other property held by the Trust, such value to be determined by
an appraiser mutually agreed upon by the Servicer and the Trustee, and shall
succeed to all interests in and to the Trust.
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ARTICLE XXII
Miscellaneous Provisions
Section 22.1 Amendment. The Agreement may be amended by
the Seller, the Servicer, the Trustee and the Class A Agent, without the
consent of any of the Certificateholders, to cure any ambiguity, to correct or
supplement any provisions in the Agreement, or to add any other provisions with
respect to matters or questions arising under the Agreement that shall not be
inconsistent with the provisions of the Agreement; provided, however, that such
action shall not, as evidenced by an Opinion of Counsel, adversely affect in
any material respect the interests of any Certificateholder. The Agreement
also may be amended by the Seller, the Servicer, the Trustee and the Class A
Agent, without the consent of any of the Certificateholders, to provide for the
transfer of the Class B Certificates; provided, however, that the conditions
specified in the third and fourth paragraphs of Section 16.3 shall be satisfied
prior to such transfer; provided, further, that such amendment shall not change
the timing of or the amount of any distributions that the Class A
Certificateholders are entitled to receive hereunder.
The Agreement may also be amended from time to time by the
Seller, the Servicer, the Trustee and the Class A Agent with the consent of the
Holders of Class A Certificates and Class B Certificates, each voting as a
Class (which consent of any Holder of a Certificate given pursuant to this
Section or pursuant to any other provision of this Agreement shall be
conclusive and binding on such Holder and on all future Holders of such
Certificate and of any Certificate issued upon the transfer thereof or in
exchange thereof or in lieu thereof whether or not notation of such consent is
made upon the Certificate), evidencing not less than 51% of the Class A
Certificate Balance and Class B Certificate Balance, respectively, for the
purpose of adding any provisions to or changing in any manner or eliminating
any of the provisions of the Agreement, or of modifying in any manner the
rights of the Holders of Certificates; provided, however, that no such
amendment shall (a) increase or reduce in any manner the amount of, or
accelerate or delay the timing of, collections of payments on Receivables or
distributions
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that shall be required to be made on any Certificate or change the Pass Through
Rate or the Specified Subordinated Spread Account Balance or (b) reduce the
aforesaid percentage required to consent to any such amendment, without the
consent of the Holders of all Certificates then outstanding.
Prior to the execution of any such amendment or consent, the
Servicer will provide and the Trustee shall distribute written notification of
the substance of such amendment or consent to each of the rating agencies then
rating the Certificates.
Promptly after the execution of any such amendment or consent,
the Trustee shall furnish written notification of the substance of such
amendment or consent to each Certificateholder.
It shall not be necessary for the consent of
Certificateholders pursuant to this Section 22.1 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 any other consents of Certificateholders provided for in this
Agreement) and of evidencing the authorization of the execution thereof by
Certificateholders shall be subject to such reasonable requirements as the
Trustee may prescribe, including the establishment of record dates pursuant to
paragraph number 2 of the Depository Agreement.
Prior to the execution of any amendment to the Agreement, the
Trustee shall be entitled to receive and rely upon an Opinion of Counsel
stating that the execution of such amendment is authorized or permitted by the
Agreement and the Opinion of Counsel referred to in Section 22.2(i)(1). The
Trustee may, but shall not be obligated to, enter into any such amendment which
affects the Trustee's own rights, duties or immunities under the Agreement or
otherwise.
Section 22.2 Protection of Title to Trust.
(a) The Seller shall execute and file such financing
statements and cause to be executed and filed such continuation statements, all
in such manner
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and in such places as may be required by law fully to preserve, maintain, and
protect the interest of the Certificateholders and the Trustee in the
Receivables and in the proceeds thereof. The Seller shall deliver (or cause to
be delivered) to the Trustee file-stamped copies of, or filing receipts for,
any document filed as provided above, as soon as available following such
filing.
(b) 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 Section 9-402(7) of the UCC, unless it shall have given the Trustee
at least five days' prior written notice thereof and shall have promptly filed
appropriate amendments to all previously filed financing statements or
continuation statements.
(c) The Seller and the Servicer shall give the
Trustee at least 60 days' prior written notice of any relocation of its
principal executive office if, as a result of such relocation, the applicable
provisions of the UCC would require the filing of any amendment of any
previously filed financing or continuation statement or of any new financing
statement and shall promptly file any such amendment. The Servicer shall at
all times maintain each office from which it shall service Receivables, and its
principal executive office, within the United States of America.
(d) The Servicer shall maintain accounts and records
as to each Receivable accurately and in sufficient detail to permit (i) the
reader thereof to know at any time the status of such Receivable, including
payments and recoveries made and payments owing (and the nature of each) and
(ii) reconciliation between payments or recoveries on (or with respect to) each
Receivable and the amounts from time to time deposited in the Certificate
Account and Payahead Account in respect of such Receivable.
(e) The Servicer shall maintain its computer systems
so that, from and after the time of sale under the Agreement of the Receivables
to the Trust, the Servicer's master computer records (including any back-up
archives) that refer to a Receivable shall indicate
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clearly the interest of the particular grantor trust in such Receivable and
that such Receivable is owned by the Trust. Indication of the Trust's
ownership of a Receivable shall be deleted from or modified on the Servicer's
computer systems when, and only when, the Receivable shall have been paid in
full or repurchased.
(f) If at any time the Seller or the Servicer shall
propose to sell, grant a security interest in, or otherwise transfer any
interest in automotive receivables to any prospective purchaser, lender, or
other transferee, the Servicer shall give to such prospective purchaser,
lender, or other transferee computer tapes, records, or print-outs (including
any restored from back-up archives) that, if they shall refer in any manner
whatsoever to any Receivable, shall indicate clearly that such Receivable has
been sold and is owned by the Trust.
(g) The Servicer shall permit the Trustee and its
agents at any time during normal business hours to inspect, audit, and make
copies of and abstracts from the Servicer's records regarding any Receivable.
(h) Upon request, the Servicer shall furnish to the
Trustee, within twenty Business Days, a list of all Receivables (by contract
number and name of Obligor) then held as part of the Trust, together with a
reconciliation of such list to the Schedule of Receivables and to each of the
Servicer's Certificates furnished before such request indicating removal of
Receivables from the Trust.
(i) The Servicer shall deliver to the Trustee:
(1) promptly after the execution and delivery
of the Agreement and of each amendment thereto, an Opinion
of Counsel either (A) stating that, in the opinion of such
Counsel, all financing statements and continuation
statements have been executed and filed that are necessary
fully to preserve and protect the interest of the Trustee in
the Receivables, and reciting the details of such filings or
referring to prior Opinions of Counsel in which such details
are given, or (B) stating
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that, in the opinion of such Counsel, no such action shall be
necessary to preserve and protect such interest; and
(2) within 90 days after the beginning of each
calendar year beginning with the first calendar year beginning more
than three months after the Cutoff Date, an Opinion of Counsel, dated
as of a date during such 90-day period, either (A) stating that, in
the opinion of such Counsel, all financing statements and continuation
statements have been executed and filed that are necessary fully to
preserve and protect the interest of the Trustee in the Receivables,
and reciting the details of such filings or referring to prior
Opinions of Counsel in which such details are given, or (B) stating
that, in the opinion of such Counsel, no such action shall be
necessary to preserve and protect such interest.
Each Opinion of Counsel referred to in clause (i)(1) or (i)(2)
above shall specify any action necessary (as of the date of such opinion) to be
taken in the following year to preserve and protect such interest.
(j) The Seller shall, to the extent required by
applicable law, cause the Certificates to be registered with the Securities and
Exchange Commission pursuant to Section 12(b) or Section 12(g) of the
Securities Exchange Act of 1934 within the time periods specified in such
sections.
(k) For the purpose of facilitating the
execution of the Agreement and for other purposes, the Agreement may be
executed in any number of counterparts, each of which counterparts shall be
deemed to be an original, and all of which counterparts shall constitute but
one and the same instrument.
Section 22.3 Limitation on Rights of Certificateholders.
The death or incapacity of any Certificateholder shall not operate to terminate
the Agreement or the Trust, nor entitle such Certificateholder's legal
representatives or heirs to claim an accounting or to take any action or
commence any proceeding in any court for a partition or winding up of the
Trust, nor otherwise
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affect the rights, obligations, and liabilities of the parties to the Agreement
or any of them.
No Certificateholder shall have any right to vote (except as
provided in Section 22.1 or 19.5) or in any manner otherwise control the
operation and management of the Trust, or the obligations of the parties to the
Agreement, nor shall anything in the Agreement set forth, or contained in the
terms of the Certificates, be construed so as to constitute the
Certificateholders from time to time as partners or members of an association;
nor shall any Certificateholder be under any liability to any third person by
reason of any action taken pursuant to any provision of the Agreement.
No Certificateholder shall have any right by virtue or by
availing itself of any provisions of the Agreement to institute any suit,
action, or proceeding in equity or at law upon or under or with respect to the
Agreement, unless such Holder previously shall have given to the Trustee a
written notice of default and of the continuance thereof, and unless also (i)
the default arises from the Seller's or the Servicer's failure to remit
payments when due hereunder, or (ii) the Holders of Class A Certificates
evidencing not less than 25% of the Class A Certificate Balance shall have made
written request upon the Trustee to institute such action, suit or proceeding
in its own name as Trustee under the Agreement and shall have offered to the
Trustee such reasonable indemnity as it may require against the costs,
expenses, and liabilities to be incurred therein or thereby, and the Trustee,
for 30 days after its receipt of such notice, request, and offer of indemnity,
shall have neglected or refused to institute any such action, suit or
proceeding and during such 30-day period no request or waiver inconsistent with
such written request has been given to the Trustee pursuant to this Section or
Section 19.5; no one or more Holders of Certificates shall have any right in
any manner whatever by virtue or by availing itself or themselves of any
provisions of the Agreement to affect, disturb, or prejudice the rights of the
Holders of any other of the Certificates, or to obtain or seek to obtain
priority over or preference to any other such Holder, or to enforce any right,
under the Agreement except in the manner provided in the Agreement and for the
equal, ratable, and common benefit of all Certificateholders. For the
protection and enforcement
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of the provisions of this Section 22.3, each Certificateholder and the Trustee
shall be entitled to such relief as can be given either at law or in equity.
Section 22.4 GOVERNING LAW. THE AGREEMENT SHALL BE
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK AND THE
OBLIGATIONS, RIGHTS, AND REMEDIES OF THE PARTIES UNDER THE AGREEMENT SHALL BE
DETERMINED IN ACCORDANCE WITH SUCH LAWS.
Section 22.5 Notices. All demands, notices, and
communications upon or to the Seller, the Servicer, the Trustee, or any rating
agency under the Agreement shall be in writing, personally delivered or mailed
by certified mail, return receipt requested, and shall be deemed to have been
duly given upon receipt (a) in the case of the Seller or the Servicer, to the
agent for service as specified in the Agreement, or at such other address as
shall be designated by the Seller or the Servicer in a written notice to the
Trustee, (b) in the case of the Trustee, at the Corporate Trust Office, (c) in
the case of Moody's Investors Service, Inc., at the following address: Moody's
Investors Service, Inc., ABS Monitoring Department, 99 Church Street, New York,
New York 10007, and (d) in the case of Standard & Poor's Ratings Group, at the
following address: Standard & Poor's Ratings Group, 25 Broadway, 20th Floor,
New York, New York 10004, Attention: Asset Backed Surveillance Department. Any
notice required or permitted to be mailed to a Certificateholder shall be given
by first class mail, postage prepaid, at the address of such Holder as shown in
the Certificate Register. Any notice so mailed within the time prescribed in
the Agreement shall be conclusively presumed to have been duly given, whether
or not the Certificateholder shall receive such notice.
Section 22.6 Severability of Provisions. If any one or
more of the covenants, agreements, provisions, or terms of the 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 the Agreement and shall in no
way affect the validity or enforceability of the other provisions of the
Agreement or of the Certificates or the rights of the Holders thereof.
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Section 22.7 Assignment. Notwithstanding anything to the
contrary contained herein, except as provided in Sections 17.3 and 18.3 and
as provided in the provisions of the Agreement concerning the resignation of
the Servicer, the Agreement may not be assigned by the Seller or the Servicer
without the prior written consent of the Trustee and the Holders of Class A
Certificates evidencing not less than 66-2/3% of the Class A Certificate
Balance.
Section 22.8 Certificates Nonassessable and Fully Paid.
Certificateholders shall not be personally liable for obligations of the Trust.
The interests represented by the Certificates shall be nonassessable for
any losses or expenses of the Trust or for any reason whatsoever, and, upon
authentication thereof by the Trustee pursuant to Section 16.2 or Section 16.3,
Certificates shall be deemed fully paid.
Section 22.9 Further Assurances. The Seller and the
Servicer agree to do and perform, from time to time, any and all acts and to
execute any and all further instruments required or reasonably requested by
the Trustee more fully to effect the purposes of this Agreement, including,
without limitation, the execution of any financing statements or continuation
statements relating to the Receivables for filing under the provisions of the
Uniform Commercial Code of any applicable jurisdiction.
Section 22.10 No Waiver; Cumulative Remedies. No failure
to exercise and no delay in exercising, on the part of the Trustee or the
Certificateholders, any right, remedy, power or privilege hereunder, shall
operate as a waiver thereof; nor shall any single or partial exercise of any
right, remedy, power or privilege hereunder preclude any other or further
exercise thereof or the exercise of any other right, remedy, power or
privilege. The rights, remedies, powers and privileges therein provided are
cumulative and not exhaustive of any rights, remedies, powers and privileges
provided by law.
Section 22.11 Third-Party Beneficiaries. This Agreement
will inure to the benefit of and be binding upon the parties hereto, the
Certificateholders, and their respective successors and permitted assigns.
Except as otherwise provided in this Article XXII, no other person will have
any right or obligation hereunder.
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Section 22.12 Actions by Certificateholders. (a)
Wherever in this Agreement a provision is made that an action may be taken or a
notice, demand, or instruction given by Certificateholders, such action,
notice, or instruction may be taken or given by any Certificateholder, unless
such provision requires a specific percentage of Certificateholders.
(b) Any request, demand, authorization,
direction, notice, consent, waiver, or other act by a Certificateholder shall
bind such Certificateholder and every subsequent holder of such Certificate
issued upon the registration of transfer thereof or in exchange therefor or in
lieu thereof in respect of anything done or omitted to be done by the Trustee
or the Servicer in reliance thereon, whether or not notation of such action is
made upon such Certificate.
* * * *
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EXHIBIT A
[FORM OF CLASS A CERTIFICATE -- SEE REVERSE FOR CERTAIN DEFINITIONS]
[The following legend to be inserted if this Certificate is issued to CEDE &
Co.:]
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION, 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 REQUESTED BY
AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY (AND ANY PAYMENT
IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY), ANY TRANSFER, PLEDGE, OR OTHER
USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS
THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
FORD CREDIT 1995-B GRANTOR TRUST
5.90% ASSET BACKED CERTIFICATE, CLASS A
evidencing a fractional undivided interest in the Trust, as defined
below, the property of which includes a pool of retail installment
sale contracts secured by new and used automobiles and light trucks
and sold to the Trust by Ford Credit Auto Receivables Corporation.
(This Certificate does not represent an interest in or obligation of
Ford Credit Auto Receivables Corporation or Ford Motor Credit Company
or any of their respective affiliates, except to the extent described
below.)
NUMBER [R-] CUSIP 34527WAB8
$_____________
THIS CERTIFIES THAT ____________ is the registered owner of a
___________________________ dollars nonassessable, fully-paid, fractional
undivided interest in the Ford Credit 1995-B Grantor Trust (the "Trust") formed
by Ford Credit Auto Receivables Corporation, a Delaware corporation (the "Sell-
<PAGE> 136
er"). The Trust was created pursuant to a Pooling and Servicing Agreement
dated as of November 1, 1995 (the "Agreement"), among the Seller, Ford Motor
Credit Company, as Servicer (the "Servicer"), and Chemical Bank, as Trustee
(the "Trustee") and as Class A Agent, a summary of certain of the pertinent
provisions of which is set forth below. To the extent not otherwise defined
herein, the capitalized terms used herein have the meanings assigned to them in
the Agreement. This Certificate is one of the duly authorized Certificates
designated as "5.90% Asset Backed Certificates, Class A" (herein called the
"Class A Certificates"). Also issued under the Agreement are Certificates
designated as "5.90% Asset Backed Certificates, Class B" (the "Class B
Certificates"). The Class B Certificates and the Class A Certificates are
hereinafter collectively called the "Certificates." The aggregate undivided
interest in the Trust evidenced by all Class A Certificates is 93.5%. This
Class A Certificate is issued under and is subject to the terms, provisions,
and conditions of the Agreement, to which Agreement the holder of this Class A
Certificate by virtue of the acceptance hereof assents and by which such holder
is bound. The property of the Trust includes (as more fully described in the
Agreement) a pool of retail installment sale contracts for new and used
automobiles and light trucks (the "Receivables"), certain monies due thereunder
on or after November 1, 1995, security interests in the vehicles financed
thereby, certain bank accounts and the proceeds thereof, property (including
the right to receive Liquidation Proceeds) securing the Receivables and held by
the Trustee, proceeds from claims on physical damage, credit life and
disability insurance policies covering vehicles financed thereby and the
obligors thereunder, certain other items financed by the obligors, certain
interests of the Seller in Dealer Recourse, all right, title and interest of
the Seller in and to the Purchase Agreement and any and all proceeds of the
foregoing.
Under the Agreement, there will be distributed on the 15th day of
each month or, if such 15th day is not a Business Day, the next Business Day
(the "Distribution Date"), commencing on December 15, 1995 to the person in
whose name this Class A Certificate is registered at either the close of
business on the fourteenth day of the current calendar month or, after the
issuance of Definitive Certificates pursuant to the Agreement, the last day of
the Collection Period immediately preceding the month in which such
Distribution Date occurs (the "Record Date"), such Class A Certificateholder's
fractional undivided interest in the lesser of (a) the sum of
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<PAGE> 137
the Class A Distributable Amount and any outstanding Class A Interest Carryover
Shortfall from the preceding Distribution Date (plus, to the extent not
otherwise provided for, interest on such Class A Interest Carryover Shortfall
at the Pass-Through Rate from such preceding Distribution Date through the
current Distribution Date, to the extent permitted by law and, with respect to
the Class A Interest Distributable Amount, only to the extent provided in the
Agreement) and any Class A Principal Carryover Shortfall and (b) the sum of (i)
the Total Available Amount (but with respect to the Class A Interest
Distributable Amount, only to the extent provided in the Agreement) and (ii)
amounts available in the Subordination Spread Account.
The holder of this Class A Certificate by virtue of the acceptance
hereof assents to the appointment, pursuant to Section 14.7 of the Agreement,
of Chemical Bank acting solely as agent, and not as Trustee, for such holder
with respect to the Subordination Spread Account and the Subordination Spread
Account Property.
Distributions on this Class A Certificate will be made by the
Trustee by check or money order mailed to the Class A Certificateholder of
record in the Certificate Register without the presentation or surrender of
this Class A Certificate or the making of any notation hereon except that with
respect to Class A Certificates registered in the name of Cede & Co., the
nominee for the Clearing Agency, distributions will be made in the form of
immediately available funds. Except as otherwise provided in the Agreement and
notwithstanding the above, the final distribution on this Class A Certificate
will be made after due notice by the Trustee of the pendency of such
distribution and only upon presentation and surrender of this Class A
Certificate at the office or agency maintained for that purpose by the Trustee
in the Borough of Manhattan, The City of New York. The Record Date otherwise
applicable to such distribution shall not be applicable.
Reference is hereby made to the further provisions of this Class A
Certificate set forth on the reverse hereof, which further provisions shall for
all purposes have the same effect as if set forth at this place.
Unless the certificate of authentication hereon shall have been
executed by an authorized officer of the Trustee, by manual signature, this
Class A Certificate shall not
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<PAGE> 138
entitle the holder hereof to any benefit under the Agreement or be valid for
any purpose.
IN WITNESS WHEREOF, the Trustee on behalf of the Trust and not in
its individual capacity has caused this Class A Certificate to be duly
executed.
FORD CREDIT 1995-B GRANTOR
TRUST
By: CHEMICAL BANK, as Trustee
By: _________________________
Name:
Title:
DATED:
[SEAL]
ATTEST:
_________________________
TRUST OFFICER
This is one of the Class A Certificates referred to
in the within-mentioned Agreement.
CHEMICAL BANK, as Trustee
By: _______________________
Authorized Officer
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<PAGE> 139
[Reverse of Certificate]
The Certificates do not represent an obligation of, or an interest
in, the Seller, the Servicer, the Trustee or any affiliate of any of them. The
Certificates are limited in right of payment to certain collections and
recoveries respecting the Receivables, all as more specifically set forth in
the Agreement. A copy of the Agreement may be examined during normal business
hours at the principal office of the Seller, and at such other places, if any,
designated by the Seller, by any Certificateholder upon request.
The Agreement permits, with certain exceptions therein provided,
the amendment thereof and the modification of the rights and obligations of the
Seller and the rights of the Certificateholders under the Agreement at any time
by the Seller and the Trustee with the consent of the Holders of Class A
Certificates and Class B Certificates, each voting as a Class, evidencing not
less than 51% of the Class A Certificate Balance and Class B Certificate
Balance, respectively. Any such consent by the Holder of this Certificate
shall be conclusive and binding on such Holder and on all future Holders of
this Certificate and of any Certificate issued upon the transfer hereof or in
exchange herefor or in lieu hereof whether or not notation of such consent is
made upon this Certificate. The Agreement also permits the amendment thereof,
in certain limited circumstances, without the consent of the Holders of any of
the Certificates.
As provided in the Agreement and subject to certain limitations set
forth therein, the transfer of this Certificate is registrable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the offices or agencies maintained by the Trustee in its capacity
as Certificate Registrar, or by any successor Certificate Registrar, in the
Borough of Manhattan, The City of New York, accompanied by a written instrument
of transfer in form satisfactory to the Trustee and the Certificate Registrar
duly executed by the holder hereof or such holder's attorney duly authorized in
writing, and thereupon one or more new Certificates of authorized denominations
evidencing the same aggregate interest in the Trust will be issued to the
designated transferee.
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<PAGE> 140
The Class A Certificates are issuable only as registered
Certificates without coupons in denominations of $1,000 and integral multiples
thereof; however, one Certificate may be issued in a denomination equal to or
including the residual amount. As provided in the Agreement and subject to
certain limitations therein set forth, Certificates are exchangeable for new
Certificates of authorized denominations evidencing the same aggregate
denomination, as requested by the holder surrendering the same. No service
charge will be made for any such registration of transfer or exchange, but the
Trustee may require payment of a sum sufficient to cover any tax or
governmental charges payable in connection therewith.
The Trustee, the Certificate Registrar, and any agent of the
Trustee or the Certificate Registrar may treat the person in whose name this
Class A Certificate is registered as the owner hereof for all purposes, and
neither the Trustee, the Certificate Registrar, nor any such agent shall be
affected by any notice to the contrary.
The obligations and responsibilities created by the Agreement and
the Trust created thereby shall terminate upon the payment to
Certificateholders of all amounts required to be paid to them pursuant to the
Agreement and the disposition of all property held as part of the Trust. The
Servicer of the Receivables may at its option purchase the corpus of the Trust
at a price specified in the Agreement, and such purchase of the Receivables and
other property of the Trust will effect early retirement of the Certificates;
however, such right of purchase is exercisable only as of the last day of any
Collection Period as of which the Pool Balance is less than 10% of the original
aggregate principal balance of the Receivables.
The recitals contained herein (other than the certificate of
authentication herein) shall be taken as the statements of the Seller or the
Servicer, as the case may be, and the Trustee assumes no responsibility for the
correctness thereof. The Trustee makes no representations as to the validity
or sufficiency of this Certificate (other than the certificate of
authentication herein), or of any Receivable or related document.
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<PAGE> 141
ASSIGNMENT
FOR VALUE RECEIVED the undersigned hereby sells, assigns and transfers unto
PLEASE INSERT SOCIAL SECURITY
OR OTHER IDENTIFYING NUMBER
OF ASSIGNEE
________________________________________________________________________________
(Please print or typewrite name and address, including postal zip code, of
assignee)
________________________________________________________________________________
the within Certificate, and all rights thereunder, hereby irrevocably
constituting and appointing
________________________________________________________________________________
Attorney to transfer said Certificate on the books of the Certificate
Registrar, with full power of substitution in the premises.
Dated:
__________________________*
Signature Guaranteed
__________________________*
* NOTICE: The signature to this assignment must correspond with the name as it
appears upon the face of the within Certificate in every particular, without
alteration, enlargement or any change whatever. Such signature must be
guaranteed by a member firm of the New York Stock Exchange or a commercial bank
or trust company.
A-7
<PAGE> 142
EXHIBIT B
[FORM OF CLASS B CERTIFICATE -- SEE REVERSE FOR CERTAIN DEFINITIONS]
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
PURSUANT TO THE SECURITIES ACT OF 1933 AND MAY NOT BE TRANSFERRED OR SOLD
UNLESS PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT OR AN OPINION OF COUNSEL
THAT SUCH REGISTRATION IS NOT REQUIRED AND THE SATISFACTION OF CERTAIN OTHER
REQUIREMENTS SPECIFIED IN THE AGREEMENT. EACH HOLDER OF THIS CERTIFICATE
ACKNOWLEDGES AND AGREES THAT IT HAS ASSIGNED, SOLD, CONVEYED AND TRANSFERRED
ALL ITS RIGHT, TITLE AND INTEREST IN AND TO THE SUBORDINATION SPREAD ACCOUNT
AND THE SUBORDINATION SPREAD ACCOUNT PROPERTY IN ACCORDANCE WITH SECTION 14.7
OF THE AGREEMENT.
FORD CREDIT 1995-B GRANTOR TRUST
5.90% ASSET BACKED CERTIFICATE, CLASS B
evidencing a fractional undivided interest in the Trust, as defined
below, the property of which includes a pool of retail installment
sale contracts secured by new and used automobiles and light trucks
and sold to the Trust by Ford Credit Auto Receivables Corporation.
(This Certificate does not represent an interest in or obligation of
Ford Credit Auto Receivables Corporation or Ford Motor Credit Company
or any of their respective affiliates, except to the extent described
below.)
NUMBER
R-1
$_________
THIS CERTIFIES THAT Ford Credit Auto Receivables Corporation is the
registered owner of a ______________________________ dollars and ________ cents
nonassessable, fully-paid, fractional undivided interest
<PAGE> 143
in the Ford Credit 1995-B Grantor Trust (the "Trust") formed by Ford Credit
Auto Receivables Corporation, a Delaware corporation (the "Seller"). The Trust
was created pursuant to a Pooling and Servicing Agreement dated as of November
1, 1995 (the "Agreement"), among the Seller, Ford Motor Credit Company, as
Servicer (the "Servicer"), and Chemical Bank, as Trustee (the "Trustee") and as
Class A Agent, a summary of certain of the pertinent provisions of which is set
forth below. To the extent not otherwise defined herein, the capitalized terms
used herein have the meanings assigned to them in the Agreement. This
Certificate is one of the duly authorized Certificates designated as "5.90%
Asset Backed Certificates, Class B" (herein called the "Class B Certificates").
Also issued under the Agreement are Certificates designated as "5.90% Asset
Backed Certificates, Class A" (the "Class A Certificates"). The Class B
Certificates and the Class A Certificates are hereinafter collectively called
the "Certificates." The aggregate undivided interest in the Trust evidenced by
all Class B Certificates is 6.5%. This Class B Certificate is issued under and
is subject to the terms, provisions, and conditions of the Agreement, to which
Agreement the holder of this Class B Certificate by virtue of the acceptance
hereof assents and by which such holder is bound. The property of the Trust
includes (as more fully described in the Agreement) a pool of retail
installment sale contracts for new and used automobiles and light trucks (the
"Receivables"), certain monies due thereunder on or after November 1, 1995,
security interests in the vehicles financed thereby, certain bank accounts and
the proceeds thereof, property (including the right to receive Liquidation
Proceeds) securing the Receivables, proceeds from claims on physical damage,
credit life and disability insurance policies covering vehicles financed
thereby and the obligors thereunder, certain other items financed by the
obligors, certain interests of the Seller in Dealer Recourse, all right, title
and interest of the Seller in and to the Purchase Agreement and any and all
proceeds of the foregoing. The rights of the holders of the Class B
Certificates are subordinated to the rights of the holders of the Class A
Certificates, as set forth in the Agreement.
Under the Agreement, there will be distributed on the 15th day of each
month or, if such 15th day is not a Business Day, the next Business Day (the
"Distribution
B-2
<PAGE> 144
Date"), commencing on December 15, 1995, to the person in whose name this Class
B Certificate is registered at either the close of business on the fourteenth
day of the current calendar month or, after the issuance of Definitive
Certificates pursuant to the Agreement, the last day of the Collection Period
immediately preceding the month in which such Distribution Date occurs (the
"Record Date"), such Class B Certificateholder's fractional undivided
interest in the lesser of (a) the sum of the Class B Distributable Amount and
any outstanding Class B Interest Carryover Shortfall and any Class B
Principal Carryover Shortfall and (b) the sum of (i) the Total Available Amount
and (ii) amounts available in the Subordination Spread Account in excess of the
Specified Subordinated Spread Account Balance for the next succeeding
Distribution Date, in each case after giving effect to (A) the amounts required
to be distributed to the holders of Class A Certificates pursuant to the
subordination of the rights of the holders of Class B Certificates and (B) the
amounts required to be deposited in the Subordination Spread Account and to pay
the Servicing Fee (including any unpaid Servicing Fees with respect to prior
Collection Periods) payable to the Servicer on such Distribution Date.
Each holder of this Class B Certificate acknowledges and agrees that
its rights to receive distributions in respect of this Class B Certificate are
subordinated to the rights of the Class A Certificateholders to receive
distributions in respect of the Class A Certificates and the rights of the
Servicer to receive the Servicing Fee (and any unpaid Servicing Fees from prior
Collection Periods) in the event of delinquency or defaults on the Receivables.
Each holder of this Class B Certificate acknowledges and agrees that, in order
to give effect to the subordination provisions provided in the Agreement, it
has assigned, sold, conveyed and transferred all its right, title and interest
in and to the Subordination Spread Account on the terms and conditions set
forth in the Agreement.
Distributions on this Class B Certificate will be made by the Trustee
by wire transfer, check or money order mailed to the Class B Certificateholder
of record in the Certificate Register without the presentation or surrender of
this Class B Certificate or the making of any notation hereon. Except as
otherwise provided in the
B-3
<PAGE> 145
Agreement and notwithstanding the above, the final distribution on this Class B
Certificate will be made after due notice by the Trustee of the pendency of
such distribution and only upon presentation and surrender of this Class B
Certificate at the office or agency maintained for that purpose by the Trustee
in the Borough of Manhattan, The City of New York.
Reference is hereby made to the further provisions of this Class B
Certificate set forth on the reverse hereof, which further provisions shall for
all purposes have the same effect as if set forth at this place.
Unless the certificate of authentication hereon shall have been
executed by an authorized officer of the Trustee, by manual signature, this
Class B Certificate shall not entitle the holder hereof to any benefit under
the Agreement or be valid for any purpose.
B-4
<PAGE> 146
IN WITNESS WHEREOF, the Trustee on behalf of the Trust and not in its
individual capacity has caused this Class B Certificate to be duly executed.
FORD CREDIT 1995-B GRANTOR TRUST
CHEMICAL BANK, as Trustee
DATED:__________ By: ___________________________
Name:
Title:
[SEAL]
ATTEST:
__________________
Trust Officer
This is one of the Class B Certificates referred to in the
within-mentioned Agreement.
CHEMICAL BANK, as Trustee
By: __________________________
Authorized Officer
B-5
<PAGE> 147
[Reverse of Certificate]
The Certificates do not represent an obligation of, or an interest in, the
Seller, the Servicer, the Trustee or any affiliate of any of them. The
Certificates are limited in right of payment to certain collections and
recoveries respecting the Receivables, all as more specifically set forth in
the Agreement. A copy of the Agreement may be examined during normal business
hours at the principal office of the Seller, and at such other places, if any,
designated by the Seller, by any Certificateholder upon request.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Seller and the rights of the Certificateholders under the Agreement at any time
by the Seller and the Trustee with the consent of the Holders of Class A
Certificates and Class B Certificates, each voting as a Class, evidencing not
less than 51% of the Class A Certificate Balance and Class B Certificate
Balance, respectively. Any such consent by the Holder of this Certificate
shall be conclusive and binding on such Holder and on all future Holders of
this Certificate and of any Certificate issued upon the transfer hereof or in
exchange herefor or in lieu hereof whether or not notation of such consent is
made upon this Certificate. The Agreement also permits the amendment thereof,
in certain limited circumstances, without the consent of the Holders of any of
the Certificates.
As provided in the Agreement and subject to certain limitations therein set
forth, the transfer of this Certificate is registrable in the Certificate
Register upon surrender of this Certificate for registration of transfer at the
offices or agencies maintained by the Trustee in its capacity as Certificate
Registrar, or by any successor Certificate Registrar, in the Borough of
Manhattan, The City of New York, accompanied by a written instrument of
transfer in form satisfactory to the Trustee and the Certificate Registrar duly
executed by the holder hereof or such holder's attorney duly authorized in
writing, and thereupon one or more new Certificates of authorized denominations
evidencing the same aggregate interest in the Trust will be issued to the
designated transferee.
The Class B Certificates are issuable only as registered Certificates
without coupons in denominations of $100,000 and integral multiples thereof;
however, one Certificate may be issued in a denomination equal to or including
the residual amount. As provided in the Agreement and subject to certain
limitations therein set forth, Certificates are exchangeable for new
Certificates of authorized denominations evidencing the same aggregate
denomina-
B-6
<PAGE> 148
tion, as requested by the holder surrendering the same. No service charge will
be made for any such registration of transfer or exchange, but the Trustee may
require payment of a sum sufficient to cover any tax or governmental charges
payable in connection therewith.
The Trustee, the Certificate Registrar, and any agent of the Trustee or the
Certificate Registrar may treat the person in whose name this Class B
Certificate is registered as the owner hereof for all purposes, and neither the
Trustee, the Certificate Registrar, nor any such agent shall be affected by any
notice to the contrary.
The obligations and responsibilities created by the Agreement and the Trust
created thereby shall terminate upon the payment to Certificateholders of all
amounts required to be paid to them pursuant to the Agreement and the
disposition of all property held as part of the Trust. The Servicer of the
Receivables may at its option purchase the corpus of the Trust at a price
specified in the Agreement, and such purchase of the Receivables and other
property of the Trust will effect early retirement of the Certificates;
however, such right of purchase is exercisable only as of the last day of any
Collection Period as of which the Pool Balance is less than 10% of the original
aggregate principal balance of the Receivables.
The recitals contained herein (other than the certificate of authentication
herein) shall be taken as the statements of the Seller or the Servicer, as the
case may be, and the Trustee assumes no responsibility for the correctness
thereof. The Trustee makes no representations as to the validity or
sufficiency of this Certificate (other than the certificate of authentication
herein), or of any Receivable or related document.
B-7
<PAGE> 149
ASSIGNMENT
FOR VALUE RECEIVED the undersigned hereby sells, assigns and transfers unto
PLEASE INSERT SOCIAL SECURITY
OR OTHER IDENTIFYING NUMBER
OF ASSIGNEE
__________________________________________________________________
(Please print or typewrite name and address, including postal zip code, of
assignee)
_____________________________________________________________ the within
Certificate, and all rights thereunder, hereby irrevocably constituting and
appointing
________________________________________________ Attorney to transfer said
Certificate on the books of the Certificate Registrar, with full power of
substitution in the premises.
Dated:
__________________________*
Signature Guaranteed
__________________________*
* NOTICE: The signature to this assignment must correspond with the name as it
appears upon the face of the within Certificate in every particular, without
alteration, enlargement or any change whatever. Such signature must be
guaranteed by a member firm of the New York Stock Exchange or a commercial bank
or trust company.
B-8
<PAGE> 150
EXHIBIT C
[DTC LOGO]
BOOK-ENTRY-ONLY COLLATERALIZED MORTGAGE OBLIGATIONS (CMOS)
(WITHOUT OWNER OPTION TO REDEEM)/
OTHER ASSET-BACKED SECURITIES/AND PASS-THROUGH CERTIFICATES
Letter of Representations
[To be Completed by Issuer and Trustee]
___________________________
[Name of Issuer]
_______________________________
[Name of Trustee]
____ __, 199_
Attention: General Counsel's Office
THE DEPOSITORY TRUST COMPANY
55 Water Street; 49th Floor
New York, NY 10041-0099
Re: __________________________
__________________________
__________________________
Ladies and Gentlemen:
This letter sets forth our understanding with respect to certain
matters relating to the above-referenced issue (the "Securities"). Trustee
will act as trustee with respect to the Securities pursuant to a trust
indenture dated ____ __, 199_ (the "Document"). _______________________
("Underwriter") is distributing the Securities through The Depository Trust
Company ("DTC").
To induce DTC to accept the Securities as eligible for deposit
at DTC, and to act in accordance with its Rules with respect to the Securities,
Issuer and Trustee make the following representations to DTC:
1. Prior to closing on the Securities on ____ __, ____,
there shall be deposited with DTC one Security certificate registered in the
name of DTC's nominee, Cede & Co., for each stated maturity of the Securities
in the face amounts set forth on Schedule A hereto, the total of which
represents
<PAGE> 151
The Depository Trust Company
_______ __, 199_
Page 2
100% of the principal amount of such Securities. If, however, the aggregate
principal amount of any maturity exceeds $150 million, one certificate will be
issued with respect to each $150 million of principal
amount and an additional certificate will be issued with respect to any
remaining principal amount. Each $150 million certificate shall bear the
following legend:
Unless this certificate is presented by an authorized
representative of The Depository Trust Company, a New York corporation
("DTC"), to Issuer or its agent for registration of transfer,
exchange, or payment, and any certificate issued is registered in the
name of Cede & Co. or in such other name as is requested by an
authorized representative of DTC (and any payment is made to Cede &
Co. or to such other entity as is requested by an authorized
representative of DTC), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR
VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the
registered owner hereof, Cede & Co., has an interest herein.
2. In the event of any solicitation of consents from or
voting by holders of the Securities, Issuer or Trustee shall establish a record
date for such purposes (with no provision for revocation of consents or votes
by subsequent holders) and shall, to the extent possible, send notice of such
record date to DTC not less than 15 calendar days in advance of such record
date. Notices to DTC pursuant to this Paragraph by telecopy shall be sent to
DTC's Reorganization Department at (212) 709-6896 or (212) 709-6897, and
receipt of such notices shall be confirmed by telephoning (212) 709-6870.
Notices to DTC pursuant to this Paragraph by mail or by any other means shall
be sent to DTC's Reorganization Department as indicated in Paragraph 4.
3. In the event of a full or partial redemption, Issuer or
Trustee shall send a notice to DTC specifying: (a) the amount of the redemption
or refunding; (b) in the case of a refunding, the maturity date(s) established
under the refunding; and (c) the date such notice is to be mailed to Security
holders or published (the "Publication Date"). Such notice shall be sent to
DTC by a secure means (e.g., legible telecopy, registered or certified mail,
overnight delivery) in a timely manner designed to assure that such notice is
in DTC's possession no later than the close of business on the business day
before or, if possible, two business days before the Publication Date. Issuer
or Trustee shall forward such notice either in a separate secure transmission
for each CUSIP number or in a secure transmission for multiple CUSIP numbers
(if applicable) which includes a manifest or list of each CUSIP number
submitted in that transmission. (The party sending such notice shall have a
method to verify subsequently the use of such means and the timeliness of such
notice.) The Publication Date shall be not less than 30 days nor more than 60
days prior to the redemption date or, in the case of an advance refunding, the
date that the proceeds are deposited in escrow. Notices to DTC pursuant to
this Paragraph by telecopy shall be sent to DTC's Call Notification Department
at (516) 227-4039 or (516) 227-4190. If the party sending the notice does not
receive a telecopy receipt from DTC confirming that the notice has been
received, such party shall telephone (516) 227-4070. Notices to DTC pursuant
to this Paragraph by mail or by any other means shall be sent to:
2
<PAGE> 152
The Depository Trust Company
_______ __, 199_
Page 2
Manager: Call Notification Department
The Depository Trust Company
711 Stewart Avenue
Garden City, NY 11530-4719
4. In the event of an invitation to tender the Securities,
notice by Issuer or Trustee to Security holders specifying the terms of the
tender and the Publication Date of such notice shall be sent to DTC by a secure
means in the manner set forth in the preceding Paragraph. Notices to DTC
pursuant to this Paragraph and notices of other corporate actions (including
mandatory tenders, exchanges and capital changes) by telecopy shall be sent to
DTC's Reorganization Department at (212) 709-1093 or (212) 709-1094, and
receipt of such notices shall be confirmed by telephoning (212) 709-6884.
Notices to DTC pursuant to the above by mail or by any other means shall be
sent to:
Manager, Reorganization Department
Reorganization Window
The Depository Trust Company
7 Hanover Square, 23rd Floor
New York, NY 10004-2695
5. All notices and payment advices sent to DTC shall
contain the CUSIP number of the Securities.
6. Trustee shall send DTC written notice with respect to
the dollar amount per $1,000 original face value (or other minimum authorized
denomination if less than $1,000 face value) payable on each payment date
allocated as to the interest and principal portions thereof preferably 5, but
not less than 2, business days prior to such payment date. Such notices, which
shall also contain the current pool factor and Trustee contact's name and
telephone number, shall be sent by telecopy to DTC's Dividend Department at
(212) 709-1723, or if by mail or by any other means to:
Manager: Announcements
Dividend Department
The Depository Trust Company
7 Hanover Square; 22nd Floor
New York, NY 10004-2695
7. [NOTE: ISSUER MUST REPRESENT ONE OF THE FOLLOWING, AND
CROSS OUT THE OTHER:] [The interest accrual period is record date to record
date.] [The interest accrual period is payment date to payment date.]
8. Interest payments and principal payments that are part
of periodic principal-and-interest payments shall be received by Cede & Co., as
nominee of DTC, or its registered assigns in same-day funds on each payment
date (or the equivalent in accordance with existing arrangements between Issuer
or trustee and DTC). Such payments shall be made payable to the order of Cede
& Co. Absent any other existing arrangements, such payments shall be addressed
as follows:
C-3
<PAGE> 153
The Depository Trust Company
________ __, 199__
Page 4
Manager; Cash Receipts
Dividend Department
The Depository Trust Company
7 Hanover Square; 24th Floor
New York, NY 10004-2695
9. [NOTE: ISSUER MUST REPRESENT ONE OF THE FOLLOWING, AND
CROSS OUT THE OTHER:]
Securities Eligible for DTC's Same-Day Funds Settlement
("SDFS") System. Other principal payments (redemption payments) shall be made
in same-day funds by Trustee in the manner set forth in the SDFS Paying Agent
Operating Procedures, a copy of which previously has been furnished to Trustee.
Securities Eligible for DTC's Next-Day Funds Settlement
("NDFS") System. Other principal payments (redemption payments) shall be made
in next-day funds by Trustee to Cede & Co., as nominee of DTC, or its
registered assigns, on each payment date. Such payments shall be made payable
to the order of Cede & Co., and shall be addressed as follows:
NDFS Redemptions Manager
Reorganization/Redemptions Department
The Depository Trust Company
7 Hanover Square; 23rd Floor
New York, NY 10004-2695
10. DTC may direct Issuer or Trustee to use any other number
or address as the number or address to which notices or payments of interest or
principal may be sent.
11. In the event of a redemption, acceleration, or any other
similar transaction (e.g., tender made and accepted in response to Issuer's or
Trustee's invitation) necessitating a reduction in the aggregate principal
amount of Securities outstanding or an advance refunding of part of the
Securities outstanding, DTC, in its discretion: (a) may request Issuer or
Trustee to issue and authenticate a new Security certificate; or (b) may make
an appropriate notation on the Security certificate indicating the date and
amount of such reduction in principal except in the case of final maturity, in
which case the certificate will be presented to Issuer or Trustee prior to
payment, if required.
12. In the event that Issuer determines that beneficial
owners of Securities shall be able to obtain certificated Securities, Issuer or
Trustee shall notify DTC of the availability of certificates. In such event,
Issuer or Trustee shall issue, transfer, and exchange certificates in
appropriate amounts, as required by DTC and others.
13. DTC may discontinue providing its services as securities
depository with respect to the Securities at any time by giving reasonable
notice to Issuer or Trustee (at which time DTC will confirm with Issuer or
Trustee the aggregate principal amount of Securities outstanding). Under such
circumstances, at DTC's request Issuer and Trustee shall cooperate fully with
DTC by taking appropriate
C-4
<PAGE> 154
The Depository Trust Company
_______ __, 199__
Page 5
action to make available one or more separate certificates evidencing
Securities to any DTC Participant having Securities credited to its DTC
accounts.
14. Issuer: (a) understands that DTC has no obligation to,
and will not, communicate to its Participants or to any person having an
interest in the Securities any information contained in the security
certificate(s); and (b) acknowledges that neither DTC's Participants nor any
person having an interest in the Securities shall be deemed to have notice of
the provisions of the Security certificates by virtue of submission of such
certificate(s) to DTC.
15. Nothing herein shall be deemed to require Trustee to
advance funds on behalf of Issuer.
Notes: Very truly yours,
A. If there is a Trustee (as defined
in this Letter of Representations), _______________________________
Trustee as well as Issuer must sign (Issuer)
this Letter. If there is no Trustee,
in signing this Letter Issuer itself
undertakes to perform all of the
obligations set forth herein.
By: ___________________________
(Authorized Officer's
Signature)
B. Schedule B contains statements that
DTC believes accurately describe DTC,
the method of effecting book-entry
transfers of securities distributed
through DTC, and certain related matters.
_______________________________
(Trustee)
By: ___________________________
(Authorized Officer's
Signature)
Received and Accepted:
THE DEPOSITORY TRUST COMPANY
By:________________________________________
cc: Underwriter
Underwriter's Counsel
C-5
<PAGE> 155
SCHEDULE A
(Describe Issue)
<TABLE>
<CAPTION>
CUSIP Principal Amount Maturity Date Interest Rate
- ----- ---------------- ------------- -------------
<S> <C> <C> <C>
</TABLE>
C-6
<PAGE> 156
SCHEDULE B
SAMPLE OFFERING DOCUMENT LANGUAGE
DESCRIBING BOOK-ENTRY-ONLY ISSUANCE
(PREPARED BY DTC--BRACKETED MATERIAL MAY BE
APPLICABLE ONLY TO CERTAIN ISSUES)
1. The Depositary Trust Company ("DTC"), New York, NY, will
act as securities depository for the securities (the "Securities"). The
Securities will be issued as fully-registered securities registered in the name
of Cede & Co. (DTC's partnership nominee). One fully-registered Security
certificate will be issued for [each issue of] the Securities, [each] in the
aggregate principal amount of such issue, and will be deposited with DTC. [If,
however, the aggregate principal amount of [any] issue exceeds $150 million,
one certificate will be issued with respect to each $150 million of principal
amount and an additional certificate will be issued with respect to any
remaining principal amount of such issue.]
2. DTC is a limited-purpose trust company organized under
the New York Banking Law, a "banking organization" within the meaning of the
New York Banking Law, a member of the Federal Reserve System, a "clearing
corporation" within the meaning of the New York Uniform Commercial Code, and a
"clearing agency" registered pursuant to the provisions of Section 17A of the
Securities Exchange Act of 1934. DTC holds securities that its participants
("Participants") deposit with DTC. DTC also facilitates the settlement among
Participants of securities transactions, such as transfers and pledges, in
deposited securities through electronic computerized book-entry changes in
Participants' accounts, thereby eliminating the need for physical movement of
securities certificates. Direct Participants include securities brokers and
dealers, banks, trust companies, clearing corporations, and certain other
organizations. DTC is owned by a number of its Direct Participants and by the
New York Stock Exchange, Inc., the American Stock Exchange, Inc., and the
National Association of Securities Dealers, Inc. Access to the DTC system is
also available to others such as securities brokers and dealers, banks, and
trust companies that clear through or maintain a custodial relationship with a
Direct Participant, either directly or indirectly ("Indirect Participants").
The Rules applicable to DTC and its Participants are on file with the
Securities and Exchange Commission.
3. Purchases of Securities under the DTC system must be
made by or through Direct Participants, which will receive a credit for the
Securities on DTC's records. The ownership interest of each actual purchaser
of each Security ("Beneficial Owner") is in turn to be recorded on the Direct
and Indirect Participants' records. Beneficial Owners will not receive written
confirmation from DTC of their purchase, but Beneficial Owners are expected to
receive written confirmations providing details of the transaction, as well as
periodic statements of their holdings, from the Direct or Indirect Participant
through which the Beneficial Owner entered into the transaction. Transfers of
ownership interests in the Securities are to be accomplished by entries made on
the books of Participants acting on behalf of Beneficial Owners. Beneficial
Owners will not receive certificates representing their ownership interests in
Securities, except in the event that use of the book-entry system for the
securities is discontinued.
4. To facilitate subsequent transfers, all Securities
deposited by Participants with DTC are registered in the name of DTC's
partnership nominee, Cede & Co. The deposit of Securities with DTC and their
registration in the name of Cede & Co. effect no change in beneficial
ownership. DTC has no knowledge of the actual Beneficial Owners of the
Securities; DTC's records reflect only the identity of the Direct Participants
to whose accounts such Securities are credited, which may or may not be the
Beneficial Owners. The Participants will remain responsible for keeping
account of their holdings on behalf of their customers.
C-7
<PAGE> 157
5. Conveyances of notices and other communications by DTC
to Direct Participants, by Direct Participants to Indirect Participants, and by
Direct Participants and Indirect Participants to Beneficial Owners will be
governed by arrangements among them, subject to any statutory or regulatory
requirements as may be in effect from time to time.
[6. Redemption notices shall be sent to Cede & Co. If less
than all of the Securities within an issue are being redeemed, DTC's practice
is to determine by lot the amount of the interest of each Direct Participant in
such issue to be redeemed.]
7. Neither DTC nor Cede & Co. will consent or vote with
respect to Securities. Under its usual procedures, DTC mails an Omnibus Proxy
to the Issuer as soon as possible after the record date. The Omnibus Proxy
assigns Cede & Co.'s consenting or voting rights to those Direct Participants
to whose accounts the Securities are credited on the record date (identified in
a listing attached to the Omnibus Proxy).
8. Principal and interest payments on the Securities will
be made to DTC. DTC's practice is to credit Direct Participants' accounts on
payable date in accordance with their respective holdings shown on DTC's
records unless DTC has reason to believe that it will not receive payment on
payable date. Payments by Participants to Beneficial Owners will be governed
by standing instructions and customary practices, as is the case with
securities held for the accounts of customers in bearer form or registered in
"street name," and will be the responsibility of such Participant and not of
DTC, the Agent, or the Issuer, subject to any statutory or regulatory
requirements as may be in effect from time to time. Payment of principal and
interest to DTC is the responsibility of the Issuer or the Agent, disbursement
of such payments to Direct Participants shall be the responsibility of DTC, and
disbursement of such payments to the Beneficial Owners shall be the
responsibility of Direct and Indirect Participants.
[9. A Beneficial Owner shall give notice to elect to have
its Securities purchased or tendered, through its Participant, to the
[Tender/Remarketing] Agent, and shall effect delivery of such Securities by
causing the Direct Participant to transfer the Participant's interest in the
Securities, on DTC's records, to the [Tender/Remarketing] Agent. The
requirement for physical delivery of Securities in connection with a demand for
purchase or a mandatory purchase will be deemed satisfied when the ownership
rights in the Securities are transferred by Direct Participants on DTC's
records.]
10. DTC may discontinue providing its services as securities
depository with respect to the Securities at any time by giving reasonable
notice to the Issuer or the Agent. Under such circumstances, in the event that
a successor securities depository is not obtained, Security certificates are
required to be printed and delivered.
11. The Issuer may decide to discontinue use of the system
of book-entry transfer through DTC (or a successor securities depository). In
that event, Security certificates will be printed and delivered.
12. The information in this section concerning DTC and DTC's
book-entry system has been obtained from sources that the Issuer believes to be
reliable, but the Issuer takes no responsibility for the accuracy thereof.
C-8
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EXHIBIT D-1
Trustee's Certificate
pursuant to Section 20.3
of the Pooling and Servicing
Agreement
Chemical Bank, as trustee (the "Trustee") of the Ford Credit
1995-B Grantor Trust created pursuant to the Pooling and Servicing Agreement
(including the Standard Terms and Conditions of Agreement incorporated by
reference therein, the "Pooling and Servicing Agreement") dated as of November
1, 1995, among Ford Credit Auto Receivables Corporation, as Seller (the
"Seller"), Ford Motor Credit Company, as Servicer and the Trustee, does hereby
sell, transfer, assign, and otherwise convey to the Seller, without recourse,
representation, or warranty, all of the Trustee's right, title, and interest in
and to all of the Receivables (as defined in the Pooling and Servicing
Agreement) identified in the attached Servicer's Certificate as "Purchased
Receivables," which are to be repurchased by the Seller pursuant to Section
12.2 and all security and documents relating thereto.
IN WITNESS WHEREOF I have hereunto set my hand this ____ day
of __________, 19__.
_________________________
<PAGE> 159
EXHIBIT D-2
Trustee's Certificate
pursuant to Section 20.3
of the Pooling and Servicing
Agreement
Chemical Bank, as trustee (the "Trustee") of the Ford Credit
1995-B Grantor Trust created pursuant to the Pooling and Servicing Agreement
(including the Standard Terms and Conditions of Agreement incorporated by
reference therein, the "Pooling and Servicing Agreement") dated as of November
1, 1995, among Ford Credit Auto Receivables Corporation, as Seller, Ford Motor
Credit Company, as Servicer (the "Servicer") and the Trustee, does hereby sell,
transfer, assign, and otherwise convey to the Servicer, without recourse,
representation, or warranty, all of the Trustee's right, title, and interest in
and to all of the Receivables (as defined in the Pooling and Servicing
Agreement) identified in the attached Servicer's Certificate as "Purchased
Receivables," which are to be purchased by the Servicer pursuant to Section
13.7 or 21.2, and all security and documents relating thereto.
IN WITNESS WHEREOF I have hereunto set my hand this ____ day
of __________, 19__.
___________________________
<PAGE> 1
EXHIBIT 10.1
PURCHASE AGREEMENT
This PURCHASE AGREEMENT is made as of this 1st day of November
1995, by and between FORD MOTOR CREDIT COMPANY, a Delaware corporation (the
"Seller"), having its principal executive office at The American Road,
Dearborn, Michigan 48121, and FORD CREDIT AUTO RECEIVABLES CORPORATION, a
Delaware corporation (the "Purchaser"), having its principal executive office
at The American Road, Dearborn, Michigan 48121.
WHEREAS, in the regular course of its business, the Seller
purchases certain motor vehicle retail installment sale contracts secured by
new and used automobiles and light duty trucks from motor vehicle dealers.
WHEREAS, the Seller and the Purchaser wish to set forth the
terms pursuant to which the Receivables (as hereinafter defined) are to be sold
by the Seller to the Purchaser, which Receivables will be transferred by the
Purchaser, pursuant to the Pooling and Servicing Agreement (as hereinafter
defined) to the Ford Credit 1995-B Grantor Trust to be created thereunder,
which Trust will issue certificates representing fractional undivided interests
in such Receivables and the other property of the Trust (the "Certificates").
NOW, THEREFORE, in consideration of the foregoing, other good
and valuable consideration, and the mutual terms and covenants contained
herein, the parties hereto agree as follows:
ARTICLE I
CERTAIN DEFINITIONS
Terms not defined in this Agreement shall have the meaning set
forth in the Pooling and Servicing Agreement. As used in this Agreement, the
following terms shall, unless the context otherwise requires, have the
following meanings (such meanings to be equally applicable to the singular and
plural forms of the terms defined):
<PAGE> 2
"Agreement" shall mean this Purchase Agreement and all
amendments hereof and supplements hereto.
"Assignment" shall mean the document of assignment attached to
this Agreement as Exhibit A.
"Class A Certificate" shall have the meaning specified in the
Pooling and Servicing Agreement.
"Class B Certificate" shall have the meaning specified in the
Pooling and Servicing Agreement.
"Closing Date" shall mean November 15, 1995.
"Collections" shall mean all amounts collected by the Servicer
(from whatever source) on or with respect to the Receivables.
"Cut-Off Date" shall mean November 1, 1995.
"Distribution Date" shall mean, for each Collection Period,
the 15th day of the following month or, if such fifteenth day is not a Business
Day, the next succeeding Business Day.
"Obligor" shall have the meaning specified in the Pooling and
Servicing Agreement.
"Person" shall have the meaning specified in the Pooling and
Servicing Agreement.
"Pooling and Servicing Agreement" shall mean the Pooling and
Servicing Agreement by and among the Seller, as servicer, the Purchaser, as
seller, and Chemical Bank, as trustee and as agent for the holders of the Class
A Certificates, dated as of November 1, 1995.
"Prospectus" shall have the meaning assigned to such term in
the Underwriting Agreement.
"Purchaser" shall mean Ford Credit Auto Receivables
Corporation, a Delaware corporation, its successors and assigns.
"Rating Agency" shall mean Moody's Investors Service, Inc. and
Standard & Poor's Ratings Group or any successors thereto.
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<PAGE> 3
"Receivable" shall mean any retail installment sale contract
which appears on Exhibit B hereto and any amendments, modifications or
supplements to such retail installment sale contract.
"Receivable Files" shall have the meaning specified in the
Pooling and Servicing Agreement.
"Receivables Purchase Price" shall mean $1,750,016,370.06.
"Repurchase Event" shall have the meaning specified in Section
6.2 hereof.
"Schedule of Receivables" shall mean the list of Receivables
annexed hereto as Exhibit B.
"Seller" shall mean Ford Motor Credit Company, a Delaware
corporation, its successors and assigns.
"Servicing Fee" shall have the meaning specified in the
Pooling and Servicing Agreement.
"Trust" shall mean the Ford Credit 1995-B Grantor Trust.
"UCC" shall mean the Uniform Commercial Code, as in effect
from time to time in the relevant jurisdictions.
"Underwriting Agreement" shall mean the Underwriting Agreement
by and between Goldman, Sachs & Co., as representatives of the several
underwriters, and the Purchaser, as seller, dated November 7, 1995.
ARTICLE II
PURCHASE AND SALE OF RECEIVABLES
2.1 Purchase and Sale of Receivables
On the Closing Date, subject to the terms and conditions of
this Agreement, the Seller agrees to sell to the Purchaser, and the Purchaser
agrees to purchase
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<PAGE> 4
from the Seller, the Receivables and the other property relating thereto (as
defined below).
(a) Sale of Receivables. Effective as of the
Closing Date and simultaneously with the transactions pursuant to the Pooling
and Servicing Agreement, the Seller hereby sells, transfers, assigns and
otherwise conveys to the Purchaser, without recourse, all right, title and
interest of the Seller, whether now owned or hereafter acquired, in and to the
following: (i) the Receivables, and all monies paid thereon and due thereon on
or after the Cut-Off Date (including any monies received prior to the Cut-Off
Date that are due on or after the Cut-Off Date and were not used to reduce the
principal balance of the Receivable); (ii) the security interests in the
Financed Vehicles granted by Obligors pursuant to the Receivables; (iii) any
proceeds from claims on any physical damage, credit life, credit disability, or
other insurance policies covering Financed Vehicles or Obligors; (iv) Dealer
Recourse; (v) rebates of premiums and other amounts relating to insurance
policies and other items financed under the Receivables in effect as of the
Cut-Off Date; and (vi) the proceeds of any and all of the foregoing.
(b) Receivables Purchase Price. In consideration
for the Receivables and other properties described in Section 2.1(a), the
Purchaser shall, on the Closing Date, pay to the Seller the Receivables
Purchase Price. An amount equal to approximately 93.106591% (representing the
proceeds from the sale of the Class A Certificates less the Subordination
Initial Deposit) of the Receivables Purchase Price shall be paid to the Seller
in cash. The remaining approximately 6.893409% of the Receivables Purchase
Price shall be deemed paid and returned to the Purchaser and be considered a
contribution to capital. The portion of the Receivables Purchase Price to be
paid in cash shall be by federal wire transfer (same day) funds.
2.2 The Closing. The sale and purchase of the
Receivables shall take place at a closing (the "Closing") at the offices of
Skadden, Arps, Slate, Meagher & Flom, 919 Third Avenue, New York, New York
10022 on the Closing Date, simultaneously with the closings under: (a) the
Pooling and Servicing Agreement pursuant to which (i) the Purchaser will assign
all of its right, title and inter-
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<PAGE> 5
ests in and to the Receivables and other property to the Trustee for the
benefit of the Certificateholders; and (ii) the Purchaser will deposit the
foregoing into the Trust in exchange for the Class A Certificates and Class B
Certificates; and (b) the Underwriting Agreement, pursuant to which the
Purchaser will sell to the underwriters named therein (the "Underwriters") the
Class A Certificates.
ARTICLE III
REPRESENTATIONS AND WARRANTIES
3.1 Warranties of the Purchaser. The Purchaser hereby
represents and warrants to the Seller as of the date hereof and as of the
Closing Date:
(a) Organization, etc. The Purchaser has been
duly incorporated and is validly existing as a corporation in good standing
under the laws of the State of Delaware, and has full corporate power and
authority to execute and deliver this Agreement and to perform the terms and
provisions hereof and thereof.
(b) Due Authorization and No Violation. This
Agreement has been duly authorized, executed and delivered by the Purchaser,
and is the valid, binding and enforceable obligation of the Purchaser except as
the same may be limited by insolvency, bankruptcy, reorganization or other laws
relating to or affecting the enforcement of creditors' rights or by general
equity principles. The consummation of the transactions contemplated by this
Agreement, and the fulfillment of the terms thereof, will not conflict with or
result in a breach of any of the terms or provisions of, or constitute a
default under (in each case material to the Purchaser), or result in the
creation or imposition of any lien, charge or encumbrance (in each case
material to the Purchaser) upon any of the property or assets of the Purchaser
pursuant to the terms of, any indenture, mortgage, deed of trust, loan
agreement, guarantee, lease financing agreement or similar agreement or
instrument under which the Purchaser is a debtor or guarantor, nor will such
action result in any violation of the provisions of the Certificate of
Incorporation or the By-laws of the Purchaser.
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<PAGE> 6
(c) No Litigation. No legal or governmental
proceedings are pending to which the Purchaser is a party or of which any
property of the Purchaser is the subject, and no such proceedings are
threatened or contemplated by governmental authorities or threatened by others,
other than such proceedings which will not have a material adverse effect upon
the general affairs, financial position, net worth or results of operations (on
an annual basis) of the Purchaser and will not materially and adversely affect
the performance by the Purchaser of its obligations under, or the validity and
enforceability of, this Agreement.
3.2 Representations and Warranties of the Seller.
(a) The Seller hereby represents and warrants to
the Purchaser as of the date hereof and as of the Closing Date:
(i) Organization, etc. The Seller has
been duly incorporated and is validly existing as a corporation in
good standing under the laws of the State of Delaware, and is duly
qualified to transact business and is in good standing in each
jurisdiction in the United States of America in which the conduct of
its business or the ownership of its property requires such
qualification.
(ii) Power and Authority. The Seller has
full power and authority to sell and assign the property sold and
assigned to the Purchaser hereunder and has duly authorized such sale
and assignment to the Purchaser by all necessary corporate action.
This Agreement has been duly authorized, executed and delivered by the
Seller and shall constitute the legal, valid and binding obligation of
the Seller except as the same may be limited by insolvency,
bankruptcy, reorganization or other laws relating to or affecting the
enforcement of creditors' rights or by general equity principles.
(iii) No Violation. The consummation of the
transactions contemplated by this Agreement, and the fulfillment of
the terms thereof, will not conflict with or result in a breach of any
of the terms or provisions of, or constitute a
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<PAGE> 7
default under (in each case material to the Seller and its
subsidiaries considered as a whole), or result in the creation or
imposition of any lien, charge or encumbrance (in each case material
to the Seller and its subsidiaries considered as a whole) upon any of
the property or assets of the Seller pursuant to the terms of, any
indenture, mortgage, deed of trust, loan agreement, guarantee, lease
financing agreement or similar agreement or instrument under which
the Seller is a debtor or guarantor, nor will such action result in
any violation of the provisions of the Certificate of Incorporation or
the By-Laws of the Seller.
(iv) No Proceedings. No legal or
governmental proceedings are pending to which the Seller is a party or
of which any property of the Seller is the subject, and no such
proceedings are threatened or contemplated by governmental authorities
or threatened by others, other than such proceedings which will not
have a material adverse effect upon the general affairs, financial
position, net worth or results of operations (on an annual basis) of
the Seller and its subsidiaries considered as a whole and will not
materially and adversely affect the performance by the Seller of its
obligations under, or the validity and enforceability of, this
Agreement.
(b) The Seller makes the following
representations and warranties as to the Receivables on which the Purchaser
relies in accepting the Receivables. Such representations and warranties speak
as of the execution and delivery of this Agreement, but shall survive the sale,
transfer, and assignment of the Receivables to the Purchaser and the subsequent
assignment and transfer pursuant to the Pooling and Servicing Agreement:
(i) Characteristics of Receivables.
Each Receivable (a) shall have been originated in the United States of
America by a Dealer for the retail sale of a Financed Vehicle in the
ordinary course of such Dealer's business, shall have been fully and
properly executed by the parties thereto, shall have been purchased by
the Seller from such Dealer under an existing dealer agreement with
the Seller, shall have been validly assigned by such
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<PAGE> 8
Dealer to the Seller, (b) shall have created or shall create a valid,
subsisting, and enforceable first priority security interest in favor
of the Seller in the Financed Vehicle, which security interest shall
be assignable by the Seller to the Purchaser, (c) shall contain
customary and enforceable provisions such that the rights and remedies
of the holder thereof shall be adequate for realization against the
collateral of the benefits of the security, (d) shall provide for
level monthly payments (provided that the payment in the first or last
month in the life of the Receivable may be minimally different from
the level payment) that fully amortize the Amount Financed by maturity
and yield interest at the Annual Percentage Rate, and (e) shall
provide for, in the event that such contract is prepaid, a prepayment
that fully pays the Principal Balance.
(ii) Schedule of Receivables. The
information set forth in Exhibit B to this Agreement shall be true and
correct in all material respects as of the opening of business on the
Cut-Off Date, and no selection procedures believed to be adverse to
the Certificateholders shall have been utilized in selecting the
Receivables from those receivables which meet the criteria contained
herein. The computer tape regarding the Receivables made available to
the Purchaser and its assigns is true and correct in all respects.
(iii) Compliance with Law. Each
Receivable and the sale of the Financed Vehicle shall have complied at
the time it was originated or made and at the execution of this
Agreement shall comply in all material respects with all requirements
of applicable federal, state, and local laws, and regulations
thereunder, including, without limitation, usury laws, the Federal
Truth-in-Lending Act, the Equal Credit Opportunity Act, the Fair
Credit Reporting Act, the Fair Debt Collection Practices Act, the
Federal Trade Commission Act, the Magnuson-Moss Warranty Act, the
Federal Reserve Board's Regulations B and Z, and state adaptations of
the National Consumer Act and of the Uniform Consumer Credit Code, and
other consumer credit laws and equal credit opportunity and disclosure
laws.
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(iv) Binding Obligation. Each Receivable
shall represent the genuine, legal, valid, and binding payment
obligation in writing of the Obligor, enforceable by the holder
thereof in accordance with its terms subject to the effect of
bankruptcy, insolvency, reorganization, or other similar laws
affecting the enforcement of creditors' rights generally.
(v) No Government Obligor. None of the
Receivables shall be due from the United States of America or any
state or from any agency, department, or instrumentality of the United
States of America or any state.
(vi) Security Interest in Financed
Vehicle. Immediately prior to the sale, assignment, and transfer
thereof, each Receivable shall be secured by a validly perfected first
security interest in the Financed Vehicle in favor of the Seller as
secured party or all necessary and appropriate actions shall have been
commenced that would result in the valid perfection of a first
security interest in the Financed Vehicle in favor of the Seller as
secured party.
(vii) Receivables in Force. No Receivable
shall have been satisfied, subordinated, or rescinded, nor shall any
Financed Vehicle have been released from the lien granted by the
related Receivable in whole or in part.
(viii) No Waiver. No provision of a
Receivable shall have been waived.
(ix) No Defenses. No right of
rescission, setoff, counterclaim, or defense shall have been asserted
or threatened with respect to any Receivable.
(x) No Liens. To the best of the
Seller's knowledge, no liens or claims shall have been filed for work,
labor, or materials relating to a Financed Vehicle that shall be liens
prior to, or equal or coordinate with, the security interest in the
Financed Vehicle granted by the Receivable.
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<PAGE> 10
(xi) No Default. Except for payment
defaults continuing for a period of not more than thirty days as of
the Cut-Off Date, no default, breach, violation, or event permitting
acceleration under the terms of any Receivable shall have occurred;
and no continuing condition that with notice or the lapse of time
would constitute a default, breach, violation, or event permitting
acceleration under the terms of any Receivable shall have arisen; and
the Seller shall not waive any of the foregoing.
(xii) Insurance. The Seller, in accordance
with its customary procedures, shall have determined that the Obligor
has obtained or agreed to obtain physical damage insurance covering
the Financed Vehicle.
(xiii) Title. It is the intention of the
Seller that the transfer and assignment herein contemplated constitute
a sale of the Receivables from the Seller to the Purchaser and that
the beneficial interest in and title to the Receivables not be part of
the Seller's estate in the event of the filing of a bankruptcy
petition by or against the Seller under any bankruptcy law. No
Receivable has been sold, transferred, assigned, or pledged by the
Seller to any Person other than the Purchaser. Immediately prior to
the transfer and assignment herein contemplated, the Seller had good
and marketable title to each Receivable free and clear of all Liens,
encumbrances, security interests, and rights of others and,
immediately upon the transfer thereof, the Purchaser shall have good
and marketable title to each Receivable, free and clear of all Liens,
encumbrances, security interests, and rights of others; and the
transfer has been perfected under the UCC.
(xiv) Valid Assignment. No Receivable shall
have been originated in, or shall be subject to the laws of, any
jurisdiction under which the sale, transfer, and assignment of such
Receivable under this Agreement shall be unlawful, void, or voidable.
The Seller has not entered into any agreement with any account debtor
that prohibits, restricts or conditions the Assignment of any portion
of the Receivables.
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(xv) All Filings Made. All filings
(including, without limitation, UCC filings) necessary in any
jurisdiction to give the Purchaser a first perfected ownership
interest in the Receivables shall have been made.
(xvi) One Original. There shall be only
one original executed copy of each Receivable.
(xvii) New and Used Vehicles. Approximately
70.0% of the aggregate Principal Balance of the Receivables,
constituting 61.8% of the number of Receivables, as of the Cutoff
Date, represent vehicles financed at new vehicle rates, and the
remainder of the Receivables represent vehicles financed at used
vehicle rates.
(xviii) Origination. Each Receivable shall
have an origination date on or after November 1, 1994.
(xix) Maturity of Receivables. Each
Receivable shall have an original maturity of not greater than 60
months.
(xx) Minimum Annual Percentage Rate.
Each Receivable shall have an Annual Percentage Rate equal to or
greater than 7.35%.
(xxi) Scheduled Payments. Each Receivable
shall have a first Scheduled Payment due on or prior to November 30,
1995 and no Receivable shall have a payment that is more than 30 days
overdue as of the Cut-Off Date.
(xxii) Location of Receivable Files. The
Receivable Files shall be kept at one or more of the locations listed
in Schedule A hereto.
(xxiii) No Extensions. The number of
Scheduled Payments shall not have been extended on any Receivable on
or before the Cut-Off Date.
(xxiv) Other Data. The numerical data
relating to the characteristics of the Receivables contained in the
Prospectus are true and correct in all material respects.
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(xxv) Chattel Paper. Each Receivable
constitutes "chattel paper" as defined in the UCC.
(xxvi) No Simple Interest
Receivables. None of the Receivables are Simple Interest Receivables.
(xxvii) Agreement. The
representations and warranties in this Agreement shall be true.
ARTICLE IV
CONDITIONS
4.1 Conditions to Obligation of the Purchaser. The
obligation of the Purchaser to purchase the Receivables is subject to the
satisfaction of the following conditions:
(a) Representations and Warranties True. The
representations and warranties of the Seller hereunder shall be true and
correct on the Closing Date with the same effect as if then made, and the
Seller shall have performed all obligations to be performed by it hereunder on
or prior to the Closing Date.
(b) Computer Files Marked. The Seller shall, at
its own expense, on or prior to the Closing Date, indicate in its computer
files that the Receivables have been sold to the Purchaser pursuant to this
Agreement and deliver to the Purchaser the Schedule of Receivables certified by
an officer of the Seller to be true, correct and complete.
(c) Documents to be delivered by the Seller at
the Closing.
(i) The Assignment. At the Closing, the
Seller will execute and deliver the Assignment. The Assignment shall
be substantially in the form of Exhibit A hereto.
(ii) Evidence of UCC Filing. On or prior
to the Closing Date, the Seller shall record
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and file, at its own expense, a UCC-1 financing statement in each
jurisdiction in which required by applicable law, executed by the
Seller, as seller or debtor, and naming the Purchaser, as purchaser or
secured party, naming the Receivables and the other property conveyed
hereunder as collateral, meeting the requirements of the laws of each
such jurisdiction and in such manner as is necessary to perfect the
sale, transfer, assignment and conveyance of such Receivables to the
Purchaser. The Seller shall deliver a file-stamped copy, or other
evidence satisfactory to the Purchaser of such filing, to the
Purchaser on or prior to the Closing Date.
(iii) Other Documents. Such other documents
as the Purchaser may reasonably request.
(d) Other Transactions. The transactions
contemplated by the Pooling and Servicing Agreement shall be consummated on
the Closing Date.
4.2 Conditions to Obligation of the Seller. The
obligation of the Seller to sell the Receivables to the Purchaser is subject to
the satisfaction of the following conditions:
(a) Representations and Warranties True. The
representations and warranties of the Purchaser hereunder shall be true and
correct on the Closing Date with the same effect as if then made, and the
Purchaser shall have performed all obligations to be performed by it hereunder
on or prior to the Closing Date.
(b) Receivables Purchase Price. At the Closing
Date, the Purchaser will deliver to the Seller the Receivables Purchase Price,
as provided in Section 2.1(b).
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ARTICLE V
COVENANTS OF THE SELLER
The Seller covenants and agrees with the Purchaser as follows,
provided, however, that to the extent that any provision of this ARTICLE V
conflicts with any provision of the Pooling and Servicing Agreement, the
Pooling and Servicing Agreement shall govern:
5.1 Protection of Right, Title and Interest.
(a) The Seller shall execute and file such
financing statements and cause to be executed and filed such continuation
statements, all in such manner and in such places as may be required by law
fully to preserve, maintain, and protect the interest of the Purchaser in the
Receivables and in the proceeds thereof. The Seller shall deliver (or cause to
be delivered) to the Purchaser file-stamped copies of, or filing receipts for,
any document filed as provided above, as soon as available following such
filing.
(b) The Seller shall not 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
Section 9-402(7) of the UCC, unless it shall have given the Purchaser at least
five days' prior written notice thereof and shall have promptly filed
appropriate amendments to all previously filed financing statements or
continuation statements.
(c) The Seller shall give the Purchaser at least
60 days' prior written notice of any relocation of its principal executive
office if, as a result of such relocation, the applicable provisions of the UCC
would require the filing of any amendment of any previously filed financing or
continuation statement or of any new financing statement and shall promptly
file any such amendment. The Seller shall at all times maintain each office
from which it shall service Receivables, and its principal executive office,
within the United States of America.
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(d) The Seller shall maintain accounts and
records as to each Receivable accurately and in sufficient detail to permit 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).
(e) The Seller shall maintain its computer
systems so that, from and after the time of sale hereunder of the Receivables
to the Purchaser, the Seller's master computer records (including any back-up
archives) that refer to a Receivable shall indicate clearly the interest of the
Purchaser in such Receivable and that such Receivable is owned by the
Purchaser. Indication of the Purchaser's ownership of a Receivable shall be
deleted from or modified on the Seller's computer systems when, and only when,
the Receivable shall have been paid in full or repurchased.
(f) If at any time the Seller shall propose to
sell, grant a security interest in, or otherwise transfer any interest in
automotive receivables to any prospective purchaser, lender, or other
transferee, the Seller shall give to such prospective purchaser, lender, or
other transferee computer tapes, records, or print-outs (including any restored
from back-up archives) that, if they shall refer in any manner whatsoever to
any Receivable, shall indicate clearly that such Receivable has been sold and
is owned by the Purchaser.
(g) The Seller shall permit the Purchaser and its
agents at any time during normal business hours to inspect, audit, and make
copies of and abstracts from the Seller's records regarding any Receivable.
(h) Upon request, the Seller shall furnish to the
Purchaser, within twenty Business Days, a list of all Receivables (by contract
number and name of Obligor) then owned by the Purchaser, together with a
reconciliation of such list to the Schedule of Receivables.
5.2 Other Liens or Interests. Except for the conveyances
hereunder and pursuant to the Pooling and Servicing Agreement, the Seller will
not sell, pledge, assign or transfer any Receivable to any other Person, or
grant, create, incur, assume or suffer to exist any Lien
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on any interest therein, and the Seller shall defend the right, title, and
interest of the Purchaser in, to and under such Receivables against all claims
of third parties claiming through or under the Seller; provided, however, that
the Seller's obligations under this Section 5.2 shall terminate upon the
termination of the Trust pursuant to the Pooling and Servicing Agreement.
5.3 Costs and Expenses. The Seller agrees to pay all
reasonable costs and disbursements in connection with the perfection, as
against all third parties, of the Purchaser's right, title and interest in and
to the Receivables.
5.4 Indemnification.
(a) The Seller shall defend, indemnify, and hold
harmless the Purchaser from and against any and all costs, expenses, losses,
damages, claims, and liabilities, arising out of or resulting from the failure
of a Receivable to be originated in compliance with all requirements of law and
for any breach of any of the Seller's representations and warranties contained
herein.
(b) The Seller shall defend, indemnify, and hold
harmless the Purchaser 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 Seller or any affiliate thereof of a Financed
Vehicle.
(c) The Seller shall defend, indemnify, and hold
harmless the Purchaser from and against any and all taxes that may at any time
be asserted against the Purchaser with respect to the transactions contemplated
herein, including, without limitation, any sales, gross receipts, general
corporation, tangible personal property, privilege, or license taxes and costs
and expenses in defending against the same.
(d) The Seller shall defend, indemnify, and hold
harmless the Purchaser 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 Purchaser
through, the negligence, willful misfeasance, or bad faith of the Seller in the
performance of
16
<PAGE> 17
its duties under this Agreement or by reason of reckless disregard of the
Seller's obligations and duties under the Agreement.
(e) The Seller shall defend, indemnify, and hold
harmless the Purchaser from and against all costs, expenses, losses, claims,
damages, and liabilities arising out of or incurred in connection with the
acceptance or performance of the Seller's trusts and duties as Servicer under
the Pooling and Servicing Agreement, except to the extent that such cost,
expense, loss, claim, damage, or liability shall be due to the willful
misfeasance, bad faith, or negligence (except for errors in judgment) of the
Purchaser.
These indemnity obligations shall be in addition to any
obligation that the Seller may otherwise have.
5.5 Sale. Seller agrees to treat this conveyance for all
purposes (including without limitation tax and financial accounting purposes)
as a sale on all relevant books, records, tax returns, financial statements and
other applicable documents.
ARTICLE VI
MISCELLANEOUS PROVISIONS
6.1 Obligations of Seller. The obligations of the Seller
under this Agreement shall not be affected by reason of any invalidity,
illegality or irregularity of any Receivable.
6.2 Repurchase Events. The Seller hereby covenants and
agrees with the Purchaser for the benefit of the Purchaser, the Trustee and the
Certificateholders, that the occurrence of a breach of any of the Seller's
representations and warranties contained in Section 3.2(b) hereof shall
constitute events obligating the Seller to repurchase Receivables hereunder
("Repurchase Events"), at the Purchase Amount from the Purchaser or from the
Trust. The repurchase obligation of the Seller shall constitute the sole
remedy to the Certificateholders, or to the Trustee, or to the Purchaser
against the Seller with respect to any Repurchase Event.
17
<PAGE> 18
6.3 Seller's Assignment of Purchased Receivables. With
respect to all Receivables repurchased by the Seller pursuant to this
Agreement, the Purchaser shall assign, without recourse, representation or
warranty, to the Seller all the Purchaser's right, title and interest in and to
such Receivables, and all security and documents relating thereto.
6.4 Trust. The Seller acknowledges that: the Purchaser
will, pursuant to the Pooling and Servicing Agreement, sell the Receivables to
the Trust and assign its rights under this Agreement to the Trustee for the
benefit of the Certificateholders, and that the representations and warranties
contained in this Agreement and the rights of the Purchaser under Sections 6.2
and 6.3 hereof are intended to benefit such Trust and any Certificateholder.
The Seller hereby consents to such sales and assignments.
6.5 Amendment. This Agreement may be amended from time
to time by a written amendment duly executed and delivered by the Seller and
the Purchaser; provided, however, that any such amendment that materially
adversely affects the rights of the Certificateholders under the Pooling and
Servicing Agreement must be consented to by the Holders of 51% of the Class A
Certificate Balance and 51% of the Class B Certificate Balance.
6.6 Accountants' Letters.
(a) Coopers & Lybrand L.L.P. will review the
characteristics of the Receivables described in the Schedule of Receivables set
forth as Exhibit B hereto and will compare those characteristics to the
information with respect to the Receivables contained in the Prospectus.
(b) Seller will cooperate with the Purchaser and
Coopers & Lybrand L.L.P. in making available all information and taking all
steps reasonably necessary to permit such accountants to complete the review
set forth in Section 6.6(a) above and to deliver the letters required of them
under the Underwriting Agreement.
(c) Coopers & Lybrand L.L.P. will deliver to the
Purchaser a letter, dated the Closing Date, in the form previously agreed to by
the Seller and the Purchaser,
18
<PAGE> 19
with respect to the financial and statistical information contained in the
Prospectus under the caption "Delinquencies, Repossessions and Net Losses" and
with respect to such other information as may be agreed in the form of letter.
6.7 Waivers. No failure or delay on the part of the
Purchaser in exercising any power, right or remedy under this Agreement or the
Assignment shall operate as a waiver thereof, nor shall any single or partial
exercise of any such power, right or remedy preclude any other or further
exercise thereof or the exercise of any other power, right or remedy.
6.8 Notices. All communications and notices pursuant
hereto to either party shall be in writing or by telegraph or telex and
addressed or delivered to it at its address (or in case of telex, at its telex
number at such address) shown in the opening portion of this Agreement or at
such other address as may be designated by it by notice to the other party and,
if mailed or sent by telegraph or telex, shall be deemed given when mailed,
communicated to the telegraph office or transmitted by telex.
6.9 Costs and Expenses. The Seller will pay all expenses
incident to the performance of its obligations under this Agreement and the
Seller agrees to pay all reasonable out-of-pocket costs and expenses of the
Purchaser, excluding fees and expenses of counsel, in connection with the
perfection as against third parties of the Purchaser's right, title and
interest in and to the Receivables and the enforcement of any obligation of the
Seller hereunder.
6.10 Representations to the Seller. The respective
agreements, representations, warranties and other statements by the Seller and
the Purchaser set forth in or made pursuant to this Agreement shall remain in
full force and effect and will survive the closing under Section 2.2 hereof.
6.11 Confidential Information. The Purchaser agrees that
it will neither use nor disclose to any person the names and addresses of the
Obligors, except in connection with the enforcement of the Purchaser's rights
hereunder, under the Receivables, under any Pooling and Servicing Agreement or
as required by law.
19
<PAGE> 20
6.12 Headings and Cross-References. The various headings
in this Agreement are included for convenience only and shall not affect the
meaning or interpretation of any provision of this Agreement. References in
this Agreement to Section names or numbers are to such Sections of this
Agreement.
6.13 GOVERNING LAW. THIS AGREEMENT AND THE ASSIGNMENT
SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE
STATE OF NEW YORK.
6.14 Counterparts. This Agreement may be executed in two
or more counterparts and by different parties on separate counterparts, each of
which shall be an original, but all of which together shall constitute one and
the same instrument.
20
<PAGE> 21
IN WITNESS WHEREOF, the parties hereby have caused this
Purchase Agreement to be executed by their respective officers thereunto duly
authorized as of the date and year first above written.
FORD MOTOR CREDIT COMPANY
By: /s/ Hurley D. Smith
---------------------------
Name: Hurley D. Smith
Title: Secretary
FORD CREDIT AUTO RECEIVABLES
CORPORATION
By: /s/ Hurley D. Smith
---------------------------
Name: Hurley D. Smith
Title: Secretary
21
<PAGE> 22
EXHIBIT A
ASSIGNMENT
For value received, in accordance with the Purchase Agreement
dated as of November 1, 1995 (the "Purchase Agreement"), between the
undersigned and FORD CREDIT AUTO RECEIVABLES CORPORATION (the "Purchaser"), the
undersigned does hereby sell, assign, transfer and otherwise convey unto the
Purchaser, without recourse, all right, title and interest of the undersigned,
whether now owned or hereafter acquired, in and to the following: (i) the
Receivables, and all monies paid thereon and due thereon on or after the
Cut-Off Date (including any monies received prior to the Cut-Off Date that are
due on or after the Cut-Off Date and were not used to reduce the principal
balance of the Receivables); (ii) the security interests in the Financed
Vehicles granted by Obligors pursuant to the Receivables; (iii) any proceeds
from claims on any physical damage, credit life, credit disability, or other
insurance policies covering Financed Vehicles or Obligors; (iv) Dealer
Recourse; (v) rebates of premiums and other amounts relating to insurance
policies and other items financed under the Receivables in effect as of the
Cut-Off Date; and (vi) the proceeds of any and all of the foregoing. The
foregoing sale does not constitute and is not intended to result in any
assumption by the Purchaser of any obligation of the undersigned to the
Obligors, insurers or any other person in connection with the Receivables,
Receivable Files, any insurance policies or any agreement or instrument
relating to any of them.
This Assignment is made pursuant to and upon the
representations, warranties and agreements on the part of the undersigned
contained in the Purchase Agreement and is to be governed by the Purchase
Agreement.
<PAGE> 23
Capitalized terms used herein and not otherwise defined shall
have the meaning assigned to them in the Purchase Agreement.
IN WITNESS WHEREOF, the undersigned has caused this Assignment
to be duly executed as of November 1, 1995.
FORD MOTOR CREDIT COMPANY
By: _______________________
Name:
Title:
2
<PAGE> 24
Exhibit B
Schedule of Receivables
DELIVERED TO PURCHASER
AT CLOSING
<PAGE> 25
Schedule A
Location of Receivable Files
Indianapolis
5875 Castle Creek Pkwy. North Drive
Suite 240
Indianapolis, IN 46250-4308
Detroit-North
580 Kirts Boulevard
Suite 300
Troy, MI 48084
Chicago-North
9700 Higgins Road
Suite 720
Rosemont, IL 60018
Ohio South
9797 Springboro Pike
Suite 302
Miamisburg, OH 45343
Detroit/West
One ParkLane Blvd.
Suite 405E
Dearborn, MI 48126
Chicago South
The Office of Waterfall Glen I
Suite 310
900 South Frontage Road
Woodridge, IL 60517
Grand Rapids
2851 Charlevoix Drive SE
Suite 300
Grand Rapids, MI 49546
Chicago-East
One River Place, Suite A
Lansing, IL 60438
<PAGE> 26
Akron
175 Montroes West Avenue
Suite 300 Crown Pointe
Copley, OH 44321
Louisville
502 Executive Park
Louisville, KY 40207
Milwaukee
10850 W. Park Place
Suite 110
Milwaukee, WI 53224
Chicago West
2500 W. Higgins Rd.
Suite 280
Hoffman Estates, IL 60195-2008
Saginaw
4901 Towne Centre Rd.
Suite 200
Saginaw, MI 48605
Findlay
3500 North Main Street
Findlay, OH 45840-1447
Cleveland
5700 Lombardo Centre
Suite 101
Seven Hills, OH 44131-2581
Philadelphia
Bay Colony Executive Park
575 E. Swedesford
Suite 100
Wayne, PA 19087
New Jersey South
5000 Dearborn Circle
Suite 200
Mt. Laurel, NJ 08054
A-2
<PAGE> 27
Baltimore-West
1829 Reistertown Road
Baltimore, MD 21208-8861
Long Island
972 Brush Hollow Road
5th Floor
Westbury, NY 11590-1740
Washington, D.C.
2440 Research Blvd.
Suite 150
Rockville, MD 20850-3293
New Haven
116 Washington Ave.
Floor #4
North Haven, CT 06473
Norfolk
Greenbrier Pointe
1401 Greenbrier Pkwy.
Suite 350
Chesapeake, VA 23320
New Jersey North
103 Eisenhower Parkway
4th Floor
Roseland, NJ 07068-1069
Pittsburgh
Foster Plaza 9
750 Holiday Drive
4th Floor, Suite 420
Pittsburgh, PA 15220-2783
Richmond
300 Arboretum Place
Suite 320
Richmond, VA 23236
Syracuse
5788 Widewaters Pkwy.
DeWitt, NY 13214
A-3
<PAGE> 28
Westchester
660 White Plains Road
Tarrytown, NY 10591-0010
Mobile
1201 Montlimar Dr.
Suite 700
Mobile, AL 36609
Birmingham
3535 Grandview Parkway
Suite 340
Birmingham, AL 35243
Orlando
2600 Lake Lucien Drive
Suite 306, The Forum Bldg.
Maitland, FL 32751
Memphis
6555 Quince Road
Suite 300
Memphis, TN 38119
Atlanta-North
North Park Town Center
1000 Abernathy Rd. N.E.
Bldg. 400, Suite 180
Atlanta, GA 30328
Greensboro
1500 Pinecroft Rd.
Suite 220
Greensboro, NC 27407
Charlotte
5832 Farm Pond Lane
Suite 200
Charlotte, NC 28212
Jacksonville
9485 Regency Square Boulevard
Jacksonville, FL 32225
A-4
<PAGE> 29
Jackson
Highland Village Center
4500 I-55 North
Suite 292
Jackson, MS 39211
Columbia
250 Berryhill Road
Suite 201
Columbia, SC 29210
Miami
6303 Blue Lagoon Drive
Suite 200
Miami, FL 33126
Dothan
3160 West Main Street
Suite 1
Dothan, AL 36301-1180
Nashville
565 Marriott Drive
Suite 190, Highland Ridge
Nashville, TN 37210
Raleigh
3651 Trust Drive
Raleigh, NC 27604
Tampa
Lincoln Pointe, Suite 800
2502 Rocky Point Drive
Tampa, FL 33607
Odessa
Ashford Park Office Center
Suite 201A
2626 John Ben Sheppard Parkway
Odessa, TX 79762
Lubbock
Suite 200
4010 82nd Street
Lubbock, TX 79424
A-5
<PAGE> 30
Dallas
801 E. Campbell Road
Suite 600, Campbell Forum
Richardson, TX 75081
Austin
1701 Directors Blvd.
Suite 320
Austin, TX 78744
Fort Worth
2350 W. Airport Hwy.
Suite 400, Center Park Tower
Bedford, TX 76022
Beaumont
2615 Calder
Suite 715
Beaumont, TX 77704
Houston-West
820 Gessner
Suite 700
Houston, TX 77024
Harlingen
1916 East Harrison
Harlingen, TX 78550
Corpus Christi
5350 South Staples
Suite 225
Corpus Christi, TX 78411
Little Rock
1701 Centerview Dr.
Suite 301
Little Rock, AR 72211
Amarillo
1616 S. Kentucky
Suite 130 Bldg. D
Amarillo, TX 79102
A-6
<PAGE> 31
El Paso
1200 Golden Key Circle
Suite 104
El Paso, TX 79925
Albuquerque
6100 Uptown Blvd., NE
Suite 300
Albuquerque, NM 87110
Houston-North
363 N. Sam Houston Pkwy. E.
Suite 700
Houston, TX 77060
San Antonio
1600 N.E. Loop 410
Suite 200
San Antonio, TX 78209
Tulsa
9820 East 41st St.
Suite 300
Tulsa, OK 74145
Minneapolis
11095 Viking Drive
Suite 308, One Southwest Crossing
Eden Prairie, MN 55344-7290
Wichita
7570 West 21st Street
Wichita, KS 67212
St. Louis
4227 Earth City Exp.
Suite 100
Earth City, MO 63045
Jefferson City
210 Prodo Drive
Jefferson City, MO 65109
Kansas City
8717 West 110th Street
Bldg. #14, Suite 550
Overland Park, KS 66210
A-7
<PAGE> 32
Des Moines
4200 Corporate Drive
Suite 107
West Des Moines, IA 50266
Omaha
10040 Regency Circle
Suite 100
Omaha, NE 68114-3786
Davenport
2535 Tech Drive
Suite 300, Commerce Exch. Bldg.
Bettendorf, IA 52722
Denver
6300 S. Syracuse Way
Suite 195
Englewood, CO 80111
Fargo
3100 13th Ave. South
Suite 304
Fargo, ND 58103
Springfield
3275 E. Ridgeview
Springfield, MO 65804-1816
Waterloo
211 E. San Marnan Dr.
Waterloo, IA 50702
San Bernadino
1615 Orange Tree Lane
Suite 215
Redlands, CA 92374
Salt Lake City
310 E. 4500 South
Suite 340
Murray, UT 84017
Honolulu
1585 Kapiolani Blvd.
Suite 922, Ala Moano Pacific Center
Honolulu, HI 96814
A-8
<PAGE> 33
Spokane
North 901 Monroe
Suite 350
Spokane, WA 99210-2148
Grand Junction
744 Horizon Ct.
Suite 330
Grand Junction, CO 81506
San Francisco
4301 Hacienda Dr.
Suite 400
Pleasanton, CA 94588
Portland
10220 S.W. Greenburg Rd.
Suite 415
Portland, OR 97223-5506
Sacramento
2720 Gateway Oaks Dr.
Suite 200
Sacramento, CA 95833
San Diego
3111 Camino Del Rio N.
Suite 1333
San Diego, CA 92108
Phoenix
4742 North 24th Street
Suite 215
Phoenix, AZ 85016
San Jose
1900 McCarthy Blvd.
Suite 400
Milpitas, CA 95035
Seattle
13555 S.E. 36th Street
Suite 350
Bellevue, WA 98006
A-9
<PAGE> 34
Orange
765 The City Drive
Suite 200
Orange, CA 92668
Anchorage
3201 C Street
Suite 203
Anchorage, AK 99503
Appleton
54 Park Place
Appleton, WI 54915-8861
South Bend
4215 Edison Lakes Parkway
Suite 140
Mishawaka, IN 46545
Columbus
655 Metro Place South
Suite 470, Metro V
Dublin, OH 43017-0792
Henderson
618 North Green Street
Henderson, KY 42420
Lansing
2140 University Park Drive
Okemos, MI 48864
Marshall
1408 North Michigan
Marshall, IL 62441
New Jersey-Central
101 Interchange Plaza
Cranbury, NJ 08512
Huntington
3425 U.S. Route 60 East
Barboursville, WV 25504
A-10
<PAGE> 35
Buffalo
95 John Muir Drive
Suite 102
Amherst, NY 14228
Manchester
4 Bedford Farms
Bedford, NH 03110
Harrisburg
4900 Ritter Road
Mechanicsburg, PA 17055
Boston South
Southboro Place, 2nd Floor
352 Turnpike Road
Southboro, MA 01772
Boston North
One Tech Drive, 3rd Floor
Andover, MA 01810-2497
Portland
2401 Congress Street
Portland, ME 04102
Albany
5 Pine West Plaza
Albany, NY 12205
Roanoke
5238 Valley Pointe Pkwy.
Roanoke, VA 24019
Falls Church
1420 Springhill Road
Suite 550
McLean, VA 22102
Bristol
Landmark Center - Suite A
113 Landmark Lane
Bristol, TN 37620
A-11
<PAGE> 36
Chattanooga
6025 Lee Highway
Suite 443
Chattanooga, TN 37421
Decatur
401 Lee Street
Suite 500
Decatur, AL 35602
Fayetteville
4317 Ramsey Street
Suite 300
Fayetteville, NC 28311
Athens
3708 Atlanta Highway
Athens, GA 30604
Knoxville
5500 Lonas Drive
Suite 260
Knoxville, TN 37909
Macon
5400 Riverside Drive
Suite 201
Macon, GA 31210
Pensacola
25 W. Cedar Street
Suite 316
Pensacola, Fl 32501
Savannah
6600 Abercorn Street
Suite 206
Savannah, GA 31405
Tyler
821 East SE Loop 323
Suite 300
Tyler, TX 75701
A-12
<PAGE> 37
Oklahoma City
4101 Perimeter Ctr Dr.
Suite 300, Perimeter Center
Oklahoma City, OK 73112-2304
Baltimore-East
Campbell Corporate Center One
4940 Campell Blvd., Suite 140
Whitemarsh Business Community
Baltimore, MD 21236
Billings
1643 Lewis Avenue
Suite 201
Billings, MT 59102
Cheyenne
6234 Yellowstone
Cheyenne, WY 82009
Cape Girardeau
2851 Independence
Cape Girardeau, MO 63701
Atlanta-South
1691 Phoenix Blvd.
Suite 300
Atlanta, GA 30349
Pasadena
800 East Colorado Blvd.
Suite 400
Pasadena, CA 91109
Colorado Springs
5575 Tech Center Dr.
Suite 220
Colorado Springs, CO 80919
South Bay
301 E. Ocean Boulevard
Suite 1900
Long Beach, CA 90802
A-13
<PAGE> 38
Ventura
260 Maple court
Suite 210
Ventura, CA 93003
Las Vegas
3900 Paradise Road
Suite 239
Las Vegas, NV 89109
Eugene
1600 Valley River Drive
Suite 190
Eugene, OR 97401
Tupelo
One Mississippi Plaza
Tupelo, MS 38801
Charleston
4975 Lacross Road
Suite 150, Rivergate Center
North Charleston, SC 29418-6518
Western Carolina
215 Thompson Street
Hendersonville, NC 28739-2828
New Orleans
3838 N. Causeway Blvd.
Suite 3000
Metairie, LA 70002
Lafayette
Saloom Office Park
Suite 350
100 Asma Boulevard
Lafayette, LA 70508
Shreveport
South Pointe Centre, Suite 200
3007 Knight Street
Shreveport, LA 71105
A-14
