<PAGE>
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON DECEMBER 17, 1996
REGISTRATION NO. 333-
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------------
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
------------------------
OLYMPIC RECEIVABLES FINANCE CORP.
(Originator of the Trusts Described Herein)
(Exact name of registrant as specified in its charter)
<TABLE>
<S> <C> <C>
DELAWARE 9999 41-1743653
(State or other jurisdiction (Primary Standard Industrial (I.R.S. Employer
of incorporation or organization Classification Code Number) Identification No.)
</TABLE>
7825 WASHINGTON AVENUE SOUTH
MINNEAPOLIS, MINNESOTA 55439-2435
(612) 942-9880
(Address, including zip code, and telephone number, including area code, of
registrant's principal executive offices)
------------------------
WARREN KANTOR
ACTING CHIEF EXECUTIVE OFFICER,
VICE PRESIDENT AND DIRECTOR
OLYMPIC RECEIVABLES FINANCE CORP.
7825 WASHINGTON AVENUE SOUTH
MINNEAPOLIS, MINNESOTA 55439-2435
(612) 942-9880
(Name, address, including zip code, and telephone number, including area code,
of agent for service)
------------------------
COPIES TO:
CHARLES F. SAWYER, ESQ. LAURA A. DEFELICE, ESQ.
Dorsey & Whitney LLP Mayer, Brown & Platt
220 South Sixth Street 1675 Broadway
Minneapolis, Minnesota 55402 New York, New York 10019-5820
(612) 340-2600 (212) 506-2500
------------------------
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC:
FROM TIME TO TIME AFTER THE EFFECTIVE DATE OF THIS REGISTRATION STATEMENT AS
DETERMINED BY MARKET CONDITIONS.
------------------------
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. / /
If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box. /X/
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. / / _________
If this Form is a post-effective amendment filed pursuant to Rule 462(b)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. / / _________
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. / /
------------------------
CALCULATION OF REGISTRATION FEE
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<CAPTION>
PROPOSED MAXIMUM PROPOSED MAXIMUM AMOUNT OF
TITLE OF EACH CLASS OF AMOUNT TO OFFERING PRICE AGGREGATE REGISTRATION
SECURITIES TO BE REGISTERED BE REGISTERED PER UNIT (1) OFFERING PRICE (1) FEE (2)
<S> <C> <C> <C> <C>
Automobile Receivables-Backed
Securities........................... $4,000,000,000 100% $4,000,000,000 $1,212,122
<FN>
(1) Estimated solely for the purposes of calculating the registration fee.
(2) The amount of Automobile Receivables-Backed Securities being carried
forward from Registration Statement No. 333-14983 pursuant to Rule 429 is
$59,588,424, and the Registrant previously paid a filing fee with respect
to such securities of $18,057.10 (calculated at the rate of 1/33 of 1% of
the amount of securities being registered, the rate in effect at the
time such Registration Statement was filed).
</TABLE>
------------------------
Pursuant to Rule 429 under the Securities Act of 1933, the
Prospectus contained in this Registration Statement also relates to
and constitutes Post-Effective Amendment No. 1 to Registration Statement
No. 333-14983, which became effective on December 5, 1995.
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL
FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF
THE SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(A),
MAY DETERMINE.
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INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A
REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR MAY
OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT
BECOMES EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR
THE SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE
SECURITIES IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE
UNLAWFUL PRIOR TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF
ANY SUCH STATE.
PROSPECTUS
SUBJECT TO COMPLETION; DATED DECEMBER 17, 1996
OLYMPIC AUTOMOBILE RECEIVABLES TRUSTS
AUTOMOBILE RECEIVABLES-BACKED CERTIFICATES
AUTOMOBILE RECEIVABLES-BACKED NOTES
------------------------
OLYMPIC RECEIVABLES FINANCE CORP.
(SELLER)
------------------------
OLYMPIC FINANCIAL LTD.
(SERVICER)
------------------------
The Automobile Receivables-Backed Certificates (the "Certificates") and the
Automobile Receivables-Backed Notes (the "Notes" and, collectively with the
Certificates, the "Securities") described herein may be sold from time to time
in one or more series, in amounts, at prices and on the terms to be determined
at the time of sale and to be set forth in a supplement to this Prospectus (a
"Prospectus Supplement"). Each series of Securities will include either one or
more classes of Certificates or, if Notes are issued as part of a series, one or
more classes of Notes and one or more classes of Certificates, as set forth in
the related Prospectus Supplement.
The Certificates and the Notes, if any, of any series of Securities will be
issued by a trust (a "Trust") to be formed with respect to such series by
Olympic Receivables Finance Corp. (the "Seller"), a wholly owned subsidiary of
Olympic Financial Ltd. ("Olympic Financial"). The assets of each Trust (the
"Trust Property") will include a pool of retail installment sales contracts and
promissory notes (the "Receivables") purchased by Olympic Financial from motor
vehicle dealers and secured by new and used automobiles and light trucks,
certain monies paid or payable thereunder after the Cutoff Date set forth in the
related Prospectus Supplement (the "Cutoff Date"), an assignment of Olympic
Financial's security interests in the vehicles financed thereby, and certain
other property, as more fully described herein and in the related Prospectus
Supplement. In addition, if so specified in the related Prospectus Supplement,
the Trust Property will include monies on deposit in one or more trust accounts
to be established with an Indenture Trustee, which may include a Pre-Funding
Account which would be used to purchase additional Receivables (the "Subsequent
Receivables") from the Seller from time to time during the Pre-Funding Period
specified in the related Prospectus Supplement.
Each Trust will be formed pursuant to either (i) a Pooling and Servicing
Agreement (the "Pooling and Servicing Agreement") to be entered into among the
Seller, Olympic Financial, in its individual capacity and as Servicer, and the
Owner Trustee specified in the related Prospectus Supplement (the "Owner
Trustee") or (ii) a Trust Agreement (the "Trust Agreement") to be entered into
among the Seller, the Owner Trustee and certain other parties as specified in
the related Prospectus Supplement. If the Trust is formed pursuant to a Trust
Agreement, a Sale and Servicing Agreement (the "Sale and Servicing Agreement")
will be entered into among the Seller, Olympic Financial, in its individual
capacity and as Servicer, the Trust and the Backup Servicer (as defined herein).
In either case, the Pooling and Servicing Agreement or the Trust Agreement and
the Sale and Servicing Agreement are collectively referred to herein as the
"Trust Documents." The Notes, if any, of a series will be issued and secured
pursuant to an Indenture (the "Indenture") between the Trust and the Indenture
Trustee specified in the related Prospectus Supplement (the "Indenture
Trustee").
Except as otherwise provided in the related Prospectus Supplement, each
class of Securities of any series will represent the right to receive a
specified amount of payments of principal and interest on the related
Receivables in the manner described herein and in the related Prospectus
Supplement. The right of each class of Securities to receive payments may be
senior or subordinate to the rights of one or more of the other classes of such
series. A series may include two or more classes of Certificates or Notes which
differ as to the timing and priority of payment, interest rate or amount of
distributions in respect of principal or interest or both. A series may include
one or more classes of Certificates or Notes entitled to distributions in
respect of principal, with disproportionate, nominal or no interest
distributions, or to interest distributions, with disproportionate, nominal or
no distributions in respect of principal. Distributions on Certificates of any
series will be subordinated in priority to payments due on the related Notes, if
any, to the extent described herein and in the related Prospectus Supplement.
The Certificates will represent fractional undivided interests in the related
Trust.
Each class of Securities will represent the right to receive distributions
or payments in the amounts, at the rates, and on the dates set forth in the
related Prospectus Supplement. The rate of distributions in respect of principal
on Certificates and payment in respect of principal on Notes, if any, of any
class will depend on the priority of payment of such class and the rate and
timing of payments (including prepayments, liquidations and repurchases of
Receivables) on the related Receivables.
Unless otherwise provided in the related Prospectus Supplement, the
Certificates and the Notes, if any, of any series initially will be represented
by certificates and notes registered in the name of Cede & Co., the nominee of
The Depository Trust Company ("DTC"). The interests of beneficial owners of the
Securities will be represented by book entries on the records of the
participating members of DTC. Definitive Securities will be available only under
limited circumstances.
There currently is no secondary market for the Securities. There can be no
assurance that any such market will develop or, if it does develop, that it will
continue. The Securities will not be listed on any securities exchange.
FOR A DISCUSSION OF CERTAIN FACTORS WHICH SHOULD BE CONSIDERED BY PROSPECTIVE
PURCHASERS OF THE SECURITIES, SEE "RISK FACTORS" AT PAGE 10
HEREIN.
------------------------
THE CERTIFICATES REPRESENT INTERESTS IN AND THE NOTES REPRESENT OBLIGATIONS OF
THE RELATED TRUST AND DO NOT REPRESENT INTERESTS IN OR OBLIGATIONS OF
OLYMPIC FINANCIAL, THE SELLER OR ANY
AFFILIATE OF EITHER.
------------------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION
PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
------------------------
Retain this Prospectus for future reference. This Prospectus may not be used
to consummate sales of securities offered hereby unless accompanied by a
Prospectus Supplement.
THE DATE OF THIS PROSPECTUS IS __________________.
<PAGE>
AVAILABLE INFORMATION
The Seller, as originator of each Trust, has filed with the Securities and
Exchange Commission (the "Commission") a Registration Statement (together with
all amendments and exhibits thereto, referred to herein as the "Registration
Statement") under the Securities Act of 1933, as amended, with respect to the
Securities offered pursuant to this Prospectus. For further information,
reference is made to the Registration Statement which is available for
inspection without charge at the office of the Commission at 450 Fifth Street,
N.W., Washington, D.C. 20549, and at the regional offices of the Commission at
Seven World Trade Center, Suite 1300, New York, New York 10048 and at
Northwestern Atrium Center, 500 West Madison Street, Suite 1400, Chicago,
Illinois 60661-2511, and copies of which may be obtained from the Commission at
prescribed rates.
REPORTS TO SECURITYHOLDERS
Unless otherwise provided in the related Prospectus Supplement, unless and
until Definitive Certificates or Definitive Notes are issued, unaudited monthly
and annual reports, containing information concerning each Trust and prepared by
the Servicer, will be sent on behalf of the Trust to the Owner Trustee for the
Certificateholders, the Indenture Trustee for the Noteholders and Cede & Co., as
registered holder of the Certificates and the Notes and the nominee of DTC. See
"Certain Information Regarding the Securities -- Statements to Securityholders"
and "-- Book-Entry Registration." Certificateholders and Noteholders are
collectively referred to herein as the "Securityholders." Certificate Owners or
Note Owners may receive such reports, upon written request, together with a
certification that they are Certificate Owners or Note Owners and payment of any
expenses associated with the distribution of such reports, from the Owner
Trustee, with respect to Certificate Owners, or the Indenture Trustee, with
respect to Note Owners, at the addresses specified in the related Prospectus
Supplement. Such reports will not constitute financial statements prepared in
accordance with generally accepted accounting principles. Neither the Seller or
Olympic Financial intends to send any of its financial reports to
Securityholders. The Servicer, on behalf of each Trust, will file with the
Commission periodic reports concerning each Trust to the extent required under
the Securities Exchange Act of 1934, as amended (the "Exchange Act"), and the
rules and regulations of the Commission thereunder.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
All documents filed by the Servicer on behalf of each Trust pursuant to
Section 13(a), 13(c), 14 or 15(d) of the Exchange Act subsequent to the date of
this Prospectus and prior to the termination of the offering of the related
Securities shall be deemed to be incorporated by reference into this Prospectus
and the related Prospectus Supplement and to be a part hereof and thereof from
the respective dates of filing of such documents. Any statement contained herein
or in a document all or any portion of which is deemed to be incorporated by
reference herein shall be deemed to be modified or superseded for purposes of
this Prospectus and the related Prospectus Supplement to the extent that a
statement contained herein or in any other subsequently filed document which
also is deemed to be incorporated by reference herein modifies or supersedes
such statement. Any statement so modified or superseded shall not be deemed,
except as so modified or superseded, to constitute a part of this Prospectus or
the related Prospectus Supplement.
The Servicer will provide without charge to any person to whom this
Prospectus is delivered, upon the written or oral request of such person, a copy
of any or all of the foregoing documents incorporated herein by reference (other
than certain exhibits to such documents). Requests for such copies should be
directed to Investor Relations, Olympic Financial Ltd., 7825 Washington Avenue
South, Minneapolis, Minnesota 55439-2435, telephone number (612) 942-9880.
2
<PAGE>
PROSPECTUS SUMMARY
THE FOLLOWING SUMMARY IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO THE
DETAILED INFORMATION APPEARING ELSEWHERE IN THIS PROSPECTUS AND BY REFERENCE TO
THE INFORMATION WITH RESPECT TO THE SECURITIES CONTAINED IN THE RELATED
PROSPECTUS SUPPLEMENT TO BE PREPARED AND DELIVERED IN CONNECTION WITH THE
OFFERING OF EACH SERIES OF SECURITIES. CERTAIN CAPITALIZED TERMS USED IN THIS
PROSPECTUS SUMMARY ARE DEFINED ELSEWHERE IN THIS PROSPECTUS AND IN THE RELATED
PROSPECTUS SUPPLEMENT. A LISTING OF THE PAGES ON WHICH SOME OF SUCH TERMS ARE
DEFINED IS FOUND IN THE "INDEX OF DEFINED TERMS."
<TABLE>
<S> <C>
Issuer............................ With respect to each series of Securities, a trust (the
"Trust") will be formed by Olympic Receivables Finance
Corp. (the "Seller") pursuant to either a Pooling and
Servicing Agreement among the Seller, Olympic Financial,
in its individual capacity and as Servicer (in such
capacity referred to herein as the "Servicer"), and the
Owner Trustee specified in the related Prospectus
Supplement, or a Trust Agreement between the Seller, the
Owner Trustee specified in the related Prospectus
Supplement and certain other parties as specified in the
related Prospectus Supplement.
Seller............................ Olympic Receivables Finance Corp., a wholly owned
subsidiary of Olympic Financial. See "The Seller."
Servicer.......................... Olympic Financial Ltd. See "Olympic Financial Ltd."
Owner Trustee..................... The Owner Trustee specified in the related Prospectus
Supplement (the "Owner Trustee"). See "Description of
the Purchase Agreements and the Trust Documents --
Servicer Termination Events" and "-- The Owner Trustee".
Backup Servicer................... Olympic Financial may be terminated as Servicer under
certain circumstances, at which time the Backup Servicer
specified in the related Prospectus Supplement (the
"Backup Servicer") will automatically become the
Servicer. See "Description of the Purchase Agreements
and the Trust Documents -- Servicer Termination Events"
and "-- The Backup Servicer."
Indenture Trustee................. With respect to any Series of Securities including one
or more classes of Notes, the Indenture Trustee
specified in the related Prospectus Supplement (the
"Indenture Trustee").
The Certificates.................. Each series of Securities will include one or more
classes of Certificates which will be issued pursuant to
the related Trust Documents.
Unless otherwise specified in the related Prospectus
Supplement, Certificates will be available for purchase
in denominations of $1,000 and in integral multiples
thereof and will be available in book-entry form only.
Unless otherwise specified in the related Prospectus
Supplement, holders of Certificates
("Certificateholders") will be able to receive
Definitive Certificates only in the limited
circumstances described herein or in the related
Prospectus Supplement. See "Certain Information
Regarding the Securities -- Book-Entry Registration."
Unless otherwise specified in the related Prospectus
Supplement, each class of Certificates will have a
stated Certificate Balance (as defined in the related
Prospectus Supplement) and will accrue interest on such
Certificate Balance at a specified rate (with respect to
each class of Certificates, the "Pass-Through Rate").
</TABLE>
3
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Each class of Certificates may have a different
Pass-Through Rate, which may be a fixed, variable or
adjustable Pass-Through Rate, or any combination of the
foregoing. The related Prospectus Supplement will
specify the Pass-Through Rate for each class of
Certificates, or the initial Pass-Through Rate and the
method for determining subsequent changes to the
Pass-Through Rate.
A series may include two or more classes of Certificates
which differ as to timing of distributions, sequential
order, priority of payment, seniority, allocation of
loss, Pass-Through Rate or amount of distributions in
respect of principal or interest, or as to which
distributions in respect of principal or interest on any
class may or may not be made upon the occurrence of
specified events or on the basis of collections from
designated portions of the Receivables Pool. In
addition, a series may include one or more classes of
Certificates ("Strip Certificates") entitled to (i)
distributions in respect of principal with
disproportionate, nominal or no interest distributions,
or (ii) interest distributions, with disproportionate,
nominal or no distributions in respect of principal.
With respect to any series of Securities including one
or more classes of Notes, distributions in respect of
the Certificates may be subordinated in priority of
payment to payments on the Notes, to the extent
specified in the related Prospectus Supplement.
If the Seller or Servicer exercises its option to
purchase the Receivables of a Trust on the terms and
conditions described below under "Description of the
Purchase Agreements and the Trust Documents --
Termination," Certificateholders will receive an amount
in respect of the Certificates as specified in the
related Prospectus Supplement. In addition, if the
related Prospectus Supplement provides that the property
of a Trust will include a Pre-Funding Account (as such
term is defined in the related Prospectus Supplement,
the "Pre-Funding Account"), Certificateholders will
receive a distribution in respect of principal on or
immediately following the end of the funding period
specified in the related Prospectus Supplement (the
"Pre-Funding Period") in an amount and manner specified
in the related Prospectus Supplement.
The Notes......................... With respect to any series of Securities including one
or more classes of Notes, such Notes will be issued
pursuant to an Indenture.
Unless otherwise specified in the related Prospectus
Supplement, Notes will be available for purchase in
denominations of $1,000 and integral multiples thereof,
and will be available in book-entry form only. Unless
otherwise specified in the related Prospectus
Supplement, holders of Notes ("Noteholders") will be
able to receive Definitive Notes only in the limited
circumstances described herein or in the related
Prospectus Supplement. See "Certain Information
Regarding the Securities -- Book-Entry Registration."
</TABLE>
4
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Unless otherwise specified in the related Prospectus
Supplement, each class of Notes will have a stated
principal amount and will bear interest at a specified
rate or rates (with respect to each class of Notes, the
"Interest Rate"). Each class of Notes may have a
different Interest Rate, which may be a fixed, variable
or adjustable Interest Rate, or any combination of the
foregoing. The related Prospectus Supplement will
specify the Interest Rate and the method for determining
subsequent changes to the Interest Rate.
A series may include two or more classes of Notes which
differ as to the timing and priority of payment,
seniority, allocations of loss, Interest Rate or amount
of payments of principal or interest, or as to which
payments of principal or interest may or may not be made
upon the occurrence of specified events or on the basis
of collections from designated portions of the
Receivables Pool. In addition, a series may include one
or more classes of Notes ("Strip Notes") entitled to (i)
principal payments with disproportionate, nominal or no
interest payments or (ii) interest payments with
disproportionate, nominal or no principal payments.
If the Seller or the Servicer exercises its option to
purchase the Receivables of a Trust on the terms and
conditions described below under "Description of the
Purchase Agreements and the Trust Documents --
Termination," the outstanding Notes, if any, of such
series will be redeemed as set forth in the related
Prospectus Supplement. In addition, if the related
Prospectus Supplement provides that the property of a
Trust will include a Pre-Funding Account, the
outstanding Notes, if any, of such series will be
subject to partial redemption on or immediately
following the end of the Pre-Funding Period in an amount
and manner specified in the related Prospectus
Supplement. In the event of such partial redemption, the
Noteholders may be entitled to receive a prepayment
premium from the Trust, in the amount and to the extent
provided in the related Prospectus Supplement.
Trust Property.................... Each Certificate will represent a fractional undivided
interest in, and each Note, if any, will represent an
obligation of, the related Trust. The assets of each
Trust (the "Trust Property") will include, among other
things, a pool (the "Receivables Pool") of retail
installment sales contracts and promissory notes (the
"Receivables") purchased or to be purchased from motor
vehicle dealers ("Dealers") by Olympic Financial and
secured by new and used automobiles and light trucks
(the "Financed Vehicles"), certain monies paid or
payable thereunder after the Cutoff Date (as specified
in the related Prospectus Supplement), an assignment of
Olympic Financial's security interests in the Financed
Vehicles and of the right to receive proceeds from
claims on certain insurance policies covering the
Financed Vehicles or the Obligors, the assignment of
certain rights of Olympic Financial against the Dealers
originating such Receivables, the Collection Account,
including all investments therein, all income from the
investment of funds therein and all
</TABLE>
5
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<TABLE>
<S> <C>
proceeds thereof, certain other accounts and the
proceeds thereof and certain other rights under the
Trust Documents. In addition, if so specified in the
related Prospectus Supplement, the Trust Property will
include monies on deposit in a Pre-Funding Account to be
established with the Indenture Trustee or the Owner
Trustee, which will be used to purchase Subsequent
Receivables (as defined below) from the Seller from time
to time during the Pre-Funding Period specified in the
related Prospectus Supplement, as well as any Subsequent
Receivables so purchased. See "The Trusts."
The Receivables of each Trust (except for Subsequent
Receivables) will be purchased by the Seller from
Olympic Financial pursuant to a purchase agreement (the
"Purchase Agreement") between the Seller and Olympic
Financial on or prior to the date of issuance of the
Securities. If and to the extent provided in the related
Prospectus Supplement, the Seller will be obligated
(subject only to the availability thereof) to purchase
from Olympic Financial and to sell to the related Trust,
and the related Trust will be obligated to purchase from
the Seller (subject to the satisfaction of certain
conditions described in the applicable Purchase
Agreement), additional Receivables (the "Subsequent
Receivables") from time to time (as frequently as daily)
during the Pre-Funding Period specified in the related
Prospectus Supplement having an aggregate principal
balance approximately equal to the amount on deposit in
the Pre-Funding Account (the "Pre-Funded Amount") on
such Closing Date.
The Trust Property of each Trust will also include an
assignment of the Seller's rights under the related
Purchase Agreement, including rights against Olympic
Financial upon the occurrence of certain breaches of
representations and warranties thereunder (a "Repurchase
Event"). See "Description of the Purchase Agreements and
Trust Documents -- Sale and Assignment of the
Receivables" and "-- Servicing Procedures."
Credit Enhancement................ If and to the extent specified in the related Prospectus
Supplement, credit enhancement with respect to a Trust
or any class of Securities may include any one or more
of the following: a financial guaranty insurance policy
(a "Policy") issued by an insurer specified in the
related Prospectus Supplement (a "Security Insurer"),
subordination of one or more other classes of
Securities, a reserve account, overcollateralization,
letters of credit, credit or liquidity facilities,
repurchase obligations, third party payments or other
support, cash deposits or other arrangements. Unless
otherwise specified in the related Prospectus
Supplement, any form of credit enhancement will have
certain limitations and exclusions from coverage
thereunder, which will be described in the related
Prospectus Supplement. "Description of the Purchase
Agreements and the Trust Documents -- Credit
Enhancement."
Servicing......................... The Servicer will be responsible for managing,
administering, servicing and making collections on the
Receivables held by each Trust. Unless otherwise
specified in the related Prospectus Supplement, with
respect to each series of Securities
</TABLE>
6
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<TABLE>
<S> <C>
compensation to the Servicer will include a monthly fee
(the "Servicing Fee") which will be payable from the
related Trust to the Servicer on each Distribution Date,
in an amount equal to the product of one-twelfth of
1.00% per annum multiplied by the aggregate principal
balance of the Receivables (the "Aggregate Principal
Balance") as of the first day of the prior calendar
month, plus any late fees and other administrative fees
and expenses or similar charges collected with respect
to the Receivables during such Monthly Period. See
"Description of the Purchase Agreements and the Trust
Documents -- Servicing Compensation."
Monthly Advances.................. Unless otherwise specified in the related Prospectus
Supplement, if the amount paid on a Receivable held by a
particular Trust in any Monthly Period is less than the
full amount of the interest accrued on such Receivable
for the number of calendar days in such Monthly Period,
the Servicer will advance to such Trust the amount of
such shortfall (a "Monthly Advance"). The Servicer will
be entitled to reimbursement of a Monthly Advance from
subsequent payments and collections on or with respect
to the related Receivable or, if such payments or
collections are insufficient to reimburse the Servicer,
from collections on other Receivables if that Receivable
becomes a Liquidated Receivable. Unless otherwise
specified in the related Prospectus Supplement, the
Servicer will not make any Monthly Advance with respect
to the principal portion of any Scheduled Payment. See
"Description of the Purchase Agreements and the Trust
Documents -- Monthly Advances."
Receivables....................... The Receivables forming part of the Trust Property of
each Trust were or will have been originated by Dealers
and sold by the Dealers to Olympic Financial in the
ordinary course of business. The Receivables will
generally be prepayable at any time without penalty to
the purchaser or co-purchasers of the Financed Vehicle
or other person or persons who are obligated to make
payments thereunder (each, an "Obligor"). See "The
Receivables." Information with respect to each
Receivables Pool, including the weighted average annual
percentage rate and the weighted average remaining
maturity, will be set forth in the related Prospectus
Supplement.
Collection Account................ With respect to each series of Securities, the Servicer
will establish and maintain one or more separate
accounts (the "Collection Account") in the name of the
Owner Trustee or, in the case of any series including
one or more classes of Notes, in the name of the
Indenture Trustee for the benefit of the
Certificateholders and the Noteholders, if any. All
payments from Obligors that are received by the Lockbox
Bank (as defined below) on behalf of each Trust will be
deposited in the related Collection Account no later
than two Business Days after receipt thereof. Unless
otherwise specified in the related Prospectus
Supplement, all payments from Obligors and all proceeds
(net of reasonable expenses of collection) with respect
to Liquidated Receivables ("Liquidation Proceeds") that
are received directly by the Servicer will be deposited
in the related Collection
</TABLE>
7
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<S> <C>
Account no later than one Business Day after receipt
thereof. Unless otherwise specified in the related
Prospectus Supplement, the Servicer will be permitted to
use any alternative remittance schedule acceptable to
the Rating Agencies (as defined below) and to the
Security Insurer, if any (unless the Security Insurer
shall be in continuing default on its obligations under
the Policy or certain bankruptcy events shall have
occurred with respect to the Security Insurer (an
"Insurer Default")). See "Description of the Purchase
Agreements and the Trust Documents -- Collections."
Mandatory Purchase of Certain
Receivables...................... With respect to each series of Securities, Olympic
Financial will make certain representations and
warranties relating to the Receivables held by the
related Trust to the Seller in the related Purchase
Agreement, the Seller will assign the right to enforce
such representations and warranties to the Owner Trustee
for the benefit of the related Trust and the Security
Insurer, if any, and if such series of Securities
includes one or more classes of Notes, the Owner Trustee
will assign its right to enforce such representations
and warranties to the related Indenture Trustee as
collateral for the Notes. The Owner Trustee and the
Indenture Trustee, if any, as assignees of the
obligations of Olympic Financial to the Seller under the
Purchase Agreement, will be entitled to require that
Olympic Financial repurchase any Receivable if the
interests of the Certificateholders, the Noteholders, if
any, or the related Trust therein are materially and
adversely affected by a breach of any such
representation or warranty (a "Repurchase Event"). See
"Description of the Purchase Agreements and the Trust
Documents -- Sale and Assignment of the Receivables."
Optional Purchase of
Receivables...................... Unless otherwise specified in the related Prospectus
Supplement, with respect to each series of Securities,
the Seller or the Servicer may purchase all the
Receivables held by the related Trust on any
Distribution Date following the first Monthly Period as
of which the Aggregate Principal Balance has declined to
10% or less (or such other percentage as may be
specified in the related Prospectus Supplement) of the
Cutoff Date Principal Balance, subject to certain
provisions in the related Trust Documents. See
"Description of the Purchase Agreements and the Trust
Documents -- Termination."
Tax Status........................ The anticipated federal income tax consequences of the
purchase, ownership and disposition of Securities issued
by a Trust will be discussed in the related Prospectus
Supplement. See "Certain Federal Income Tax
Consequences" herein and in the related Prospectus
Supplement.
ERISA Considerations.............. Subject to the considerations discussed under "ERISA
Considerations" herein and in the related Prospectus
Supplement, and unless otherwise specified in the
related Prospectus Supplement, the Notes will be
eligible for purchase by employee benefit plans. The
related Prospectus Supplement will provide further
information with respect to the eligibility of a
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class of Certificates for purchase by employee benefit
plans. See "ERISA Considerations" herein and in the
related Prospectus Supplement.
Rating............................ Unless otherwise provided in the related Prospectus
Supplement, as a condition of issuance, the Securities
of each series will be rated in one of the four highest
rating categories by at least one nationally recognized
rating agency (a "Rating Agency"). There is no assurance
that the ratings initially assigned to such Securities
will not be subsequently lowered or withdrawn by the
Rating Agencies. In the event the rating initially
assigned to any Securities is subsequently lowered for
any reason, no person or entity will be obligated to
provide any credit enhancement in addition to the credit
enhancement, if any, specified in the related Prospectus
Supplement.
Registration of Certificates...... Unless otherwise specified in the related Prospectus
Supplement, the Certificates and the Notes, if any, of
each series will be registered in the name of Cede &
Co., as the nominee of DTC, and will be available for
purchase only in book-entry form on the records of DTC
and participating members thereof. Certificates and
Notes will be issued in definitive form only under the
limited circumstances described herein. All references
herein to "Holders" or "Certificateholders" or
"Noteholders" shall reflect the rights of beneficial
owners of Certificates (the "Certificate Owners") or of
Notes ("Note Owners"), as the case may be, as they may
indirectly exercise such rights through DTC and
participating members thereof, except as otherwise
specified herein or in the related Prospectus
Supplement. See "Description of the Purchase Agreements
and the Trust Documents -- Book-Entry Registration."
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RISK FACTORS
CERTAIN LEGAL ASPECTS
With respect to each series of Securities, the transfer of the Receivables
to the related Trust will be subject to the requirements of the Uniform
Commercial Code (the "UCC") as in effect in Minnesota and New York. The Seller
will take or cause to be taken such action as is required to perfect the Trust's
rights in the Receivables. Although a Custodian (as specified in the related
Prospectus Supplement) may initially hold the Receivable Files (as defined
below), the Owner Trustee may subsequently appoint Olympic Financial, with the
consent of the Security Insurer, if any (prior to an Insurer Default) and
subject to the conditions, if any, specified in the related Prospectus
Supplement or the related Trust Documents, as custodian to hold the Receivable
Files for the Trust. In any event, the Receivable Files will not be stamped or
otherwise marked to indicate their sale to the Trust. Accordingly, there exists
a risk that, through fraud or negligence, a purchaser could acquire an interest
in the Receivables superior to the interest of the Trust or that the Trust's
security interest in the Receivables could be released.
Due to the administrative burden and expense, the certificates of title for
the Financed Vehicles will not be amended to reflect the assignment of the
security interests in the Financed Vehicles by Olympic Financial to the Seller,
or by the Seller to the Owner Trustee. In the absence of such an amendment, the
Owner Trustee may not have a perfected security interest in the Financed
Vehicles. Moreover, statutory liens for repairs or unpaid taxes may have
priority even over perfected security interests in the Financed Vehicles. See
"Description of the Purchase Agreements and the Trust Documents -- Sale and
Assignment of the Receivables" and "Certain Legal Aspects of the Receivables."
INSOLVENCY RISKS
Olympic Financial intends that any transfer of Receivables to the Seller
will constitute a sale, rather than a pledge of the Receivables to secure
indebtedness of Olympic Financial. However, if Olympic Financial were to become
a debtor under the federal bankruptcy code or similar applicable state laws
(collectively, "Insolvency Laws"), a creditor or trustee in bankruptcy of
Olympic Financial or Olympic Financial as debtor-in-possession might argue that
such sale of Receivables by Olympic Financial was a pledge of the Receivables
rather than a sale. This position, if presented to or accepted by a court, could
cause, among other things, the related Trust to experience a delay in or
reduction of collections on the Receivables.
In addition, if Olympic Financial were to become a debtor under any
Insolvency Law, a creditor or trustee in bankruptcy of Olympic Financial or
Olympic Financial as debtor-in-possession might argue that the assets and
liabilities of the Seller should be consolidated with the assets and liabilities
of Olympic Financial. The Seller has taken and will take steps in structuring
the transactions contemplated hereby and by the related Prospectus Supplement
that are intended to make it unlikely that any such attempt to consolidate the
Seller and Olympic Financial would succeed. See "The Seller." In addition, the
Seller intends that any transfer of Receivables to a Trust will constitute a
sale, rather than a pledge of the Receivables to secure indebtedness of the
Seller. Nevertheless, if these positions -- that the assets and liabilities of
the Seller should be consolidated with those of Olympic Financial, and that the
Seller's transfer of the Receivables was a pledge rather than a sale -- were
presented to or accepted by a court, a Trust could experience, among other
things, a delay in or reduction of collections on the Receivables.
A case recently decided by the United States Court of Appeals for the Tenth
Circuit contains language to the effect that accounts sold by an entity that
subsequently became bankrupt remained property of the debtor's bankruptcy
estate. Although the Receivables constitute chattel paper rather than accounts
under the UCC, sales of chattel paper, like sales of accounts, are governed by
Article 9 of the UCC. If Olympic Financial were to become a debtor under any
Insolvency Law and a court were to follow the reasoning of the Tenth Circuit
Court of Appeals and apply such reasoning to chattel paper, a Trust could
experience a delay in or reduction of collections on the Receivables.
SUBORDINATION; LIMITED ASSETS
To the extent specified in the related Prospectus Supplement, distributions
of interest and principal on some or all classes of Certificates of such series
may be subordinated in priority of payment to interest and
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principal due on the Notes (if any) of such series and/or to distributions of
interest and principal on other classes of Certificates of such series. In
addition, holders of certain classes of Securities of any series may have the
right to take actions that are detrimental to the interests of the holders of
Securities of certain other classes of Securities of such series. Moreover, no
Trust will have any significant assets or sources of funds other than the
Receivables and, to the extent provided in the related Prospectus Supplement, a
Pre-Funding Account and any credit enhancement specified in the related
Prospectus Supplement. The Notes, if any, of any series will represent
obligations solely of, and the Certificates of such series will represent
interests solely in, the related Trust, and neither the Notes nor the
Certificates of any such series will be insured or guaranteed by the Seller, the
Servicer, the applicable Owner Trustee, the applicable Indenture Trustee or,
except as specified in the related Prospectus Supplement, any other person or
entity. Consequently, holders of the Securities of any series must rely for
payment upon payments on the related Receivables and, if and to the extent
available, amounts on deposit in the Pre-Funding Account, if any, and any credit
enhancement, if any, as specified in the related Prospectus Supplement.
YIELD AND PREPAYMENT CONSIDERATIONS
The weighted average life of the Securities will be reduced by full or
partial prepayments on the Receivables. The Receivables will generally be
prepayable at any time without penalty. Prepayments (or, for this purpose,
equivalent payments to the related Trust) may result from payments by Obligors,
liquidations due to default, the receipt of proceeds from physical damage or
credit insurance, repurchases by Olympic Financial as a result of certain
uncured breaches of the warranties made by it with respect to the Receivables
("Warranty Receivables"), purchases by the Servicer as a result of certain
uncured breaches of the covenants made by it with respect to the Receivables
("Administrative Receivables") in the related Agreement, or either of the Seller
or the Servicer exercising its option to purchase all of the remaining
Receivables.
Unless otherwise specified in the related Prospectus Supplement, the amounts
paid to Securityholders in respect of principal on any Distribution Date or
Payment Date will include all prepayments on the Receivables during the
corresponding Monthly Periods. The Certificateholders and the Noteholders will
bear all reinvestment risk resulting from the timing of payments of principal on
the Securities.
LIMITED LIQUIDITY
There is currently no market for the Securities of any series. There can be
no assurance that any such market will develop or, if it does develop, that it
will provide Securityholders with liquidity of investment or will continue for
the life of the Securities. The Securities will not be listed on any securities
exchange.
Unless otherwise specified in the related Prospectus Supplement, the
Securities will be issued in book-entry, rather than physical, form and, as a
result, in certain circumstances, the liquidity of the Securities in the
secondary market and the ability of the Certificate Owners and Note Owners to
pledge them may be adversely affected. See "Plan of Distribution" and "Certain
Information Regarding the Securities -- Book-Entry Registration."
THE TRUSTS
With respect to each series of Securities, the Seller will establish a Trust
pursuant to the related Trust Documents. Prior to the sale and assignment of the
related Receivables pursuant to the related Trust Documents, the Trust will have
no assets or obligations. The Trust will not engage in any business activity
other than acquiring and holding the Trust Property, issuing the Certificates
and the Notes, if any, of such series and distributing payments thereon.
Each Certificate will represent a fractional undivided interest in, and each
Note, if any, will represent an obligation of, the related Trust. The Trust
Property of each Trust will include, among other things, (i) a Receivables Pool;
(ii) all monies paid or payable thereon after the Cutoff Date (as specified in
the related Prospectus Supplement); (iii) such amounts as from time to time may
be held in the Lockbox Account (as defined herein), the Collection Account
(including all investments in the Collection Account and all income from the
investment of funds therein and all proceeds thereof) and certain other accounts
(including the proceeds thereof); (iv) an assignment of the security interests
of Olympic Financial in the Financed Vehicles
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securing the related Receivables; (v) an assignment of the right to receive
proceeds from the exercise of rights against Dealers under agreements between
Olympic Financial and such Dealers (the "Dealer Agreements") and the assignment
of rights in respect of each related Receivable from the applicable Dealer to
Olympic Financial (the "Dealer Assignments"); (vi) an assignment of the right to
receive proceeds from claims on certain insurance policies covering the related
Financed Vehicles or Obligors; (vii) an assignment of the rights of the Seller
under the related Purchase Agreement, and (viii) certain other rights under the
related Trust Documents. See "The Receivables" and "Description of the Purchase
Agreements and the Trust Documents -- Collections." The Trust Property will also
include, if so specified in the related Prospectus Supplement, monies on deposit
in a Pre-Funding Account to be established with the Indenture Trustee or the
Owner Trustee, which will be used to purchase Subsequent Receivables from the
Seller from time to time (and as frequently as daily) during the Pre-Funding
Period specified in the related Prospectus Supplement. Any Subsequent
Receivables so purchased will be included in the related Receivables Pool
forming part of the Trust Property, subject to the prior rights of the related
Indenture Trustee and the Noteholders therein. In addition, to the extent
specified in the related Prospectus Supplement, a financial guaranty insurance
policy or some other form of credit enhancement may be issued to or held by the
Owner Trustee or the Indenture Trustee for the benefit of holders of one or more
classes of Securities.
The Servicer will service the Receivables held by each Trust and will
receive fees for such services. See "Description of the Purchase Agreements and
the Trust Documents -- Servicing Compensation." Unless otherwise specified in
the related Prospectus Supplement, Olympic Financial, on behalf of each Trust,
will hold the original installment sales contract or promissory note as well as
copies of documents and instruments relating to each Receivable and evidencing
the security interest in the Financed Vehicle securing each Receivable (the
"Receivable Files"). In order to protect the Trust's ownership interest in the
Receivables, Olympic Financial and the Seller will each file a UCC-1 financing
statement in Minnesota to give notice of such Trust's ownership of the related
Receivables and the related Trust Property.
THE OWNER TRUSTEE
The Owner Trustee for each Trust will be specified in the related Prospectus
Supplement. The Owner Trustee's liability in connection with the issuance and
sale of the Securities of such series will be limited solely to the express
obligations of such Owner Trustee set forth in the related Trust Documents. An
Owner Trustee may resign at any time, in which event the General Partner, if
any, specified in the related Prospectus Supplement, or if no such General
Partner is specified, the Servicer or its successor, will be obligated to
appoint a successor trustee acceptable to the Security Insurer. The General
Partner, if any, specified in the related Prospectus Supplement, or if no such
General Partner is specified, the Servicer, with the consent of the Security
Insurer, if any (prior to an Insurer Default), may also remove the Owner Trustee
if the Owner Trustee ceases to be eligible to continue as Owner Trustee under
the related Trust Documents or if the Owner Trustee becomes insolvent. In such
circumstances, the General Partner, if any, specified in the related Prospectus
Supplement, or if no such General Partner is specified, the Servicer will be
obligated to appoint a successor trustee acceptable to the Security Insurer. Any
resignation or removal of an Owner Trustee and appointment of a successor
trustee will be subject to any conditions or approvals specified in the related
Prospectus Supplement and will not become effective until acceptance of the
appointment by the successor trustee.
THE RECEIVABLES
GENERAL
Olympic Financial purchases retail installment sales contracts and
promissory notes secured by new and used motor vehicles from Dealers who
regularly originate and sell such contracts and notes to Olympic Financial.
Olympic Financial generally acquires each such contract or note (a "Loan") under
a Dealer Agreement and a Dealer Assignment which obligate the Dealer to
repurchase the Loan in the event of a breach by the Dealer of certain
representations and warranties made therein. These representations and
warranties typically relate to the origination of the Loan and the security
interest in the related Financed Vehicle. The Dealers' representations and
warranties do not relate to the creditworthiness of the Obligor under the Loan
or the collectibility of the Loan and, accordingly, Olympic Financial does not
have recourse to Dealers for credit losses on any Loans.
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UNDERWRITING
Olympic Financial purchases each loan in accordance with its underwriting
guidelines and procedures, which focus on buyer qualifications and collateral
value. Olympic Financial's underwriting guidelines do not distinguish between
new or used vehicles. These underwriting guidelines are intended to assess the
applicant's ability to repay the amounts due on the loan and the adequacy of the
financed vehicle as collateral. Beginning in October 1994, Olympic Financial
introduced its Classic loan program to supplement its traditional Premier
program. The Classic program was established primarily for borrowers within the
"prime" loan segment who, due to limited credit experience or certain adverse
credit events, do not meet all of the underwriting criteria established for
Premier loans. As loans purchased under the Classic program generally have
higher risk characteristics than those purchased under the Premier program,
Classic loans are offered at higher interest rates and generally have additional
conditions including higher down payment minimums and co-applicant requirements.
Additionally, with the introduction of the Classic loan program, Olympic
Financial has modified its loss reserve assumptions to reflect the anticipated
higher risk characteristics of such loans. Olympic Financial considers both its
Premier and Classic programs to be in the "prime" loan category.
Each applicant for a loan is required to complete and sign an application
which lists the applicant's assets, liabilities, income, credit and employment
history and other personal information. Upon receipt of the completed loan
application, Olympic Financial's administrative personnel order a credit bureau
report on the applicant to document the applicant's credit history.
The credit report presents a history of the applicant's credit performance
and, if applicable, contains information on such matters as past-due credit,
previous repossessions, prior loans charged-off by other lenders, real estate
liens, wage attachments and bankruptcy. The application and the credit bureau
report are given to one of Olympic Financial's credit specialists for analysis
under Olympic Financial's proprietary credit scoring system. Olympic Financial's
credit scoring system evaluates the credit applicant with an emphasis on cash
flow as a principal indicator of repayment capability and provides credit scores
which are utilized by Olympic Financial as a basis to determine if the applicant
initially falls within the parameters of Olympic Financial's underwriting
criteria for either its Premier or Classic loan program. Assuming that the
applicant qualifies under the credit scoring system, Olympic Financial will
expand its credit review by preparing an analysis of the applicant's
debt-to-income and payment-to-income ratios, and purchasing from a credit bureau
an additional credit score which attempts to assess the likelihood of borrower
bankruptcies. If the applicant meets Olympic Financial's scoring standards,
required debt-to-income ratios, payment-to-income ratios and likelihood of
bankruptcy test, Olympic Financial generally will approve the application
subject to further investigation. This investigation typically consists of
direct telephone verifications, when feasible, of the applicant's employment and
banking references. Further investigation may also include direct credit
references from banks and financial institutions noted on the application.
Once scoring and verifications have been completed, one of Olympic
Financial's credit specialists reviews the application to ensure that it meets
the credit scoring requirements of Olympic Financial's internal system, and also
reviews the various banking and employment verifications obtained. In the final
review, the credit specialist considers the amount of money to be financed in
relation to the purchase price and value of the automobile. If the vehicle is
used, Olympic Financial determines value based upon the Kelly Blue Book value or
the National Automobile Dealers Association's ("NADA") Guide on Retail and
Wholesale Values. Consistent with industry standards, this assessment does not
include inspection of the automobile. Olympic Financial does not reject an
applicant solely because of the age of the automobile.
These systems are intended to provide guidelines for lending decisions, but
are not entirely a substitute for the credit judgment of Olympic Financial's
credit specialists. Olympic Financial allows some flexibility in applying its
underwriting guidelines, but a greater level of management scrutiny is involved
in approving loans which deviate from these guidelines.
Upon completion of the credit analysis, Olympic Financial will decide
whether to approve the application as stated, or decline or condition the
approval of the loan. Conditioning approval of the application involves amending
the proposed terms of the loan in order to qualify the application according to
Olympic Financial's guidelines. Typical conditions include, but are not limited
to, requiring a co-applicant, amending
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the length of the proposed term, requiring additional down payment,
substantiation of certain credit information, and requiring proof of resolution
of certain credit deficiencies as noted on the applicant's credit history.
Approved, declined or conditioned application decisions are promptly
communicated to the dealer by phone and facsimile. Additionally, the applicant
is informed by Olympic Financial of any credit denial or other adverse action by
mail, in compliance with applicable statutory requirements.
Olympic Financial regularly reviews the quality of the loans it purchases
and conducts internal reviews on a monthly basis in an effort to ensure
compliance with its established policies and procedures.
SERVICING
Olympic Financial, as the initial Servicer, will be responsible for
managing, administering, servicing and making collections on the Receivables
held by each Trust. Olympic Financial considers a Loan delinquent when the
Obligor fails to make a contractual payment by the due date. Olympic Financial
generally utilizes several automatic dialing systems (each, an "autodialer")
initially to contact delinquent Obligors. Based on parameters established by
Olympic Financial for each of its loan programs, the autodialer will phone the
Obligor within five to ten days after the past due date. Once the call is
answered, the autodialer will immediately transfer the call to an available
customer service representative located in a regional collection center and
automatically displays the Obligor's loan information on the representative's
computer screen. The autodialer will continue to follow up with Obligors at
various times throughout the first 24 days after the past due date if previous
efforts do not result in the account deficiency being cured. In addition to
phone inquiries, Olympic Financial's loan system generates past due notices
which are mailed to the Obligor at various intervals during the first 30 days
after the past due date. The first such correspondence is generally sent
approximately 13 days after the past due date.
If the collection effort during the first 24 days after the past due date
does not result in a satisfactory resolution of the delinquent account, then
the account is forwarded to collection specialists located in the regional
servicing center where the Loan is being serviced. These collection specialists
will typically send a final demand letter to the delinquent Obligor allowing the
Obligor a specified number of days to bring the account current. During this
period, the collection specialist generally will make a recommendation as to
whether the Financed Vehicle should be repossessed or if other action, such as
a contract extension, should be considered.
Olympic Financial follows specific procedures with respect to contract
extensions. Generally, an extension requires special circumstances, is based on
a re-evaluation of the Obligor's creditworthiness, and requires approval by a
collection department manager. Under the Trust Documents, unless otherwise
specified in the related Prospectus Supplement, the Servicer will not be
permitted to extend the monthly payments of a Receivable more than a maximum of
two times in any twelve-month period, six months in the aggregate, and in no
event later than the month preceding the Final Scheduled Distribution Date (as
specified in the related Prospectus Supplement). Subject to certain limited
exceptions set forth in the related Prospectus Supplement, the Servicer cannot,
without the consent of the Security Insurer, if any (prior to an Insurer
Default), unless otherwise specified in the related Prospectus Supplement,
otherwise agree to amend or modify any Receivable. If an Insurer Default occurs,
subject to certain limited exceptions, amendments and modifications of the
Receivables will not be permitted. See "Description of the Purchase Agreements
and the Trust Documents -- Servicing Procedures."
Olympic Financial uses unaffiliated independent contractors to perform
repossessions. Once a Financed Vehicle is repossessed, a letter is sent giving
the Obligor a specified number of days to redeem the Financed Vehicle in
accordance with state law. At the expiration of the time period, Olympic
Financial will determine the method of sale and will repair (if necessary) and
prepare the Financed Vehicle for sale. Olympic Financial has historically sold
repossessed Financed Vehicles through wholesale auto auctions and retail
consignment lots. Olympic Financial has generally been able to obtain greater
proceeds and incur lower losses by "retailing" its inventory. Any surplus
proceeds received from the sale of the Financed Vehicle (net of all collection,
repossession and disposition expenses) over the balance of the Loan will be
remitted to the Obligor.
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The present policy of Olympic Financial is to charge off a Loan on the
earlier of the date on which (i) the Loan becomes 90 days delinquent or (ii) the
related Financed Vehicle is repossessed and sold. Notwithstanding this policy,
Olympic Financial may elect not to charge off a Loan that is 90 days delinquent
if Olympic Financial determines that it is likely to recover on a later date all
or a portion of the outstanding Loan balance upon repossession and sale, in
which case the Loan will be charged off when the related Financed Vehicle has
been repossessed and sold. Unless otherwise specified in the related Prospectus
Supplement, the related Trust Documents will define a "Liquidated Receivable" as
a Receivable as to which (i) the Servicer has repossessed the Financed Vehicle
and all applicable redemption periods have expired, (ii) the Servicer has
determined in good faith that all amounts it expects to recover have been
received or (iii) any scheduled payment thereon (a "Scheduled Payment") or any
portion thereof has become more than 180 days past due.
INSURANCE
Olympic Financial requires each Obligor to obtain a physical damage
insurance policy naming Olympic Financial as loss payee with respect to the
Financed Vehicle. If any Obligor is in default in the payment of a premium on
such an insurance policy, Olympic Financial may obtain a replacement policy,
paying the premium out of its own funds, and may require the Obligor to pay such
premium pursuant to an obligation separate from the contract or note evidencing
the related Loan.
DELINQUENCY, LOAN LOSS AND REPOSSESSION INFORMATION
Certain information relating to Olympic Financial's delinquency, loan loss
and repossession experience with respect to all Loans it has purchased and
continues to service will be set forth in each Prospectus Supplement. This
information will include the experience with respect to all Loans in Olympic
Financial's portfolio of Loans serviced, including Loans which do not meet the
criteria for selection as a Receivable for any particular Receivables Pool.
There can be no assurance that the delinquency, loan loss and repossession
experience on any Receivables Pool will be comparable to prior experience.
SELECTION CRITERIA AND CERTAIN OTHER CHARACTERISTICS
Information with respect to each Receivables Pool will be set forth in the
related Prospectus Supplement, including, to the extent appropriate, the
criteria used to select the related Receivables and the composition,
distribution by annual percentage rate ("APR") and geographic concentration of
such Receivables.
YIELD AND PREPAYMENT CONSIDERATIONS
Unless otherwise specified in the related Prospectus Supplement, the
Receivables will be simple interest retail installment sales contracts and
promissory notes. Payments on simple interest obligations are applied first to
interest accrued through the payment date, and the remainder is applied to
reduce the unpaid principal balance. Accordingly, if an Obligor pays an
installment before its due date, the portion of the payment allocable to
interest for the period will be less than if the payment had been made on the
due date, the portion of the payment applied to reduce the principal balance
will be correspondingly greater, and the principal balance will be amortized
more rapidly than scheduled. Conversely, if an Obligor pays an installment after
its due date, the portion of the payment allocable to interest will be greater
than if the payment had been made on the due date, the portion of the payment
applied to reduce the principal balance will be correspondingly less, and the
principal balance will be amortized slower than scheduled, in which case a
larger portion of the principal balance may be due on the final scheduled
payment date. Any interest shortfalls resulting from early payment or prepayment
of a Receivable will be funded by collections on other Receivables or, to the
extent collections are insufficient, by payments under the Policy, if any, or
other applicable form of credit enhancement, if any, described in the related
Prospectus Supplement.
A substantial portion of the Receivables will be prepayable, without premium
or penalty, by Obligors at any time. Prepayments (or, for this purpose,
equivalent payments to a Trust) also may result from liquidations due to
default, receipt of proceeds from insurance policies, repurchases by Olympic
Financial of Warranty Receivables, purchases by the Servicer of Administrative
Receivables or as a result of the Seller or the Servicer exercising its option
to purchase the Receivables Pool. See "Description of the Purchase
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Agreements and the Trust Documents." The rate of prepayments on the Receivables
may be influenced by a variety of economic, social and other factors. While
Olympic Financial does not maintain specific records for this purpose, it
estimates that, based on its experience over the past four years, the monthly
prepayment rate on the outstanding principal amount of the motor vehicle
installment sales contracts it has originated and serviced, for itself and
others, has been approximately 1.5%. However, no assurance can be given that the
Receivables included in any Receivables Pool will experience this rate of
prepayment or any greater or lesser rate. No assurance can be given that
prepayments on the Receivables will conform to any estimated or actual
historical experience, and no prediction can be made as to the actual prepayment
rates which will be experienced on the Receivables. Certificateholders and
Noteholders will bear all reinvestment risk resulting from the timing of
payments of principal on the Certificates or the Notes, as the case may be.
If so specified in the related Prospectus Supplement, certain of the
Receivables included in a Receivables Pool may provide for level monthly
payments during the scheduled term of the Receivable but a substantially larger
final payment at the scheduled maturity of the Receivable (each a "Balloon
Payment Receivable"). Although it is likely that the inclusion of such Balloon
Payment Receivables in a Receivables Pool would affect the weighted average
lives of the related Securities, no prediction can be made as to the nature or
magnitude of such effect.
POOL FACTOR
The "Certificate Pool Factor" for each class of Certificates will be an
eight-digit decimal which the Servicer will compute indicating the Certificate
Balance with respect to such Certificates as of each Distribution Date (after
giving effect to all distributions of principal made on such Distribution Date),
as a fraction of the Cutoff Date Certificate Principal Balance. The "Note Pool
Factor" for each class of Notes, if any, will be an eight-digit decimal which
the Servicer will compute indicating the remaining outstanding principal balance
with respect to such Notes as of each Payment Date (after giving effect to all
distributions of principal on such Payment Date) as a fraction of the initial
outstanding principal balance of such class of Notes. Each Certificate Pool
Factor and each Note Pool Factor will initially be 1.00000000; thereafter, the
Certificate Pool Factor and the Note Pool Factor will decline to reflect
reductions in the Certificate Balance of the applicable class of Certificates or
reductions in the outstanding principal balance of the applicable class of
Notes, as the case may be. The amount of a Certificateholder's pro rata share of
the Certificate Balance for the related class of Certificates can be determined
by multiplying the original denomination of the Certificateholder's Certificate
by the then applicable Certificate Pool Factor. The amount of a Noteholder's pro
rata share of the aggregate outstanding principal balance of the applicable
class of Notes can be determined by multiplying the original denomination of
such Noteholder's Note by the then applicable Note Pool Factor.
With respect to each Trust and pursuant to the related Trust Documents, on
each Distribution Date or Payment Date, as the case may be, the
Certificateholders and the Noteholders will receive periodic reports from the
Owner Trustee stating the Certificate Pool Factor or the Note Pool Factor, as
the case may be, and containing various other items of information. Unless and
until Definitive Certificates or Definitive Notes are issued, such reports will
be sent on behalf of the Trust to the Owner Trustee and the Indenture Trustee
and Cede & Co., as registered holder of the Certificates and the Notes and the
nominee of DTC. Certificate Owners and Note Owners may receive such reports,
upon written request, together with a certification that they are Certificate
Owners or Note Owners and payment of any expenses associated with the
distribution of such reports, from the Owner Trustee and the Indenture Trustee
at the addresses specified in the related Prospectus Supplement. See "Certain
Information Regarding the Securities -- Statements to Securityholders."
USE OF PROCEEDS
Unless otherwise specified in the related Prospectus Supplement, the net
proceeds to be received by the Seller from the sale of each series of Securities
will be used to pay to Olympic Financial the purchase price for the Receivables
and to make the deposit of the Pre-Funded Amount into the Pre-Funding Account,
if any, to repay warehouse lenders and/or to provide for other forms of credit
enhancement specified in the
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related Prospectus Supplement. The net proceeds to be received by Olympic
Financial will be used to pay its warehouse loans, and any additional proceeds
will be added to Olympic Financial's general funds and used for its general
corporate purposes. See "Olympic Financial Ltd."
THE SELLER
The Seller, a wholly owned subsidiary of Olympic Financial Ltd., was
incorporated in the State of Delaware on February 3, 1993. The Seller has been
organized for the limited purposes of purchasing receivables from Olympic
Financial Ltd. and transferring such receivables to trusts such as the Trusts
described herein and any activities incidental to and necessary or convenient
for the accomplishment of such purposes. The principal executive offices of the
Seller are located at 7825 Washington Avenue South, Suite 410, Minneapolis,
Minnesota 55439-2435, and its telephone number is (612) 942-9880.
The Seller has taken and will take steps in structuring the transactions
contemplated hereby and in the related Prospectus Supplement that are intended
to make it unlikely that a voluntary or involuntary application for relief by
Olympic Financial under any Insolvency Law will result in consolidation of the
assets and liabilities of the Seller with those of Olympic Financial. These
steps include the creation of the Seller as a separate, limited-purpose
subsidiary pursuant to a Certificate of Incorporation containing certain
limitations (including restrictions on the nature of the Seller's business and a
restriction on the Seller's ability to commence a voluntary case or proceeding
under any Insolvency Law without the unanimous affirmative vote of all of its
directors and the holders of at least 66 2/3% of its outstanding common stock).
The Seller's Certificate of Incorporation includes a provision that requires the
Seller to have at least one director who qualifies under the Certificate of
Incorporation as an "Independent Director." The Seller has no intention of
filing a voluntary petition under Insolvency Laws unless its own financial
affairs merit such action.
OLYMPIC FINANCIAL LTD.
Olympic Financial purchases, securitizes and services consumer automobile
loans originated primarily by new car dealers affiliated with major foreign and
domestic manufacturers. Olympic Financial provides an alternative and
independent source of financing to automobile dealers for their customers'
purchases of new and used automobiles. Olympic Financial attempts to meet the
needs of dealers through consistent underwriting and loan purchasing practices,
extended operating hours, competitive interest rates, a dedicated customer
service staff, fast turn-around of loan applications, promotions and systems
designed to expedite processing of loan applications.
Since the Company's inception in March 1990, the Company has established 17
regional buying centers and expanded its dealer network to include more than
7,000 dealers in 38 states. The Company's regional buying centers are located in
Phoenix, Arizona; Sacramento, California; San Diego, California; Denver,
Colorado; Orlando, Florida; Atlanta, Georgia; Boston, Massachusetts;
Minneapolis, Minnesota; St. Louis, Missouri; Buffalo, New York; Charlotte, North
Carolina; Cincinnati, Ohio; Nashville, Tennessee; Dallas, Texas; Houston, Texas;
San Antonio, Texas; and Seattle, Washington.
Olympic Financial purchases a Loan from a dealer only after Olympic
Financial has reviewed and approved a customer's credit application in
accordance with Olympic Financial's underwriting policies and procedures. See
"The Receivables -- Underwriting." Olympic Financial accumulates the automobile
loans it purchases and then sells them to a trust, which in turn sells
asset-backed securities to investors (a "securitization"). Prior to each
securitization, Olympic Financial funds the acquisition of loans primarily
through warehouse facilities with financial institutions and institutional
lenders.
Olympic Financial is a Minnesota corporation. Olympic Financial's principal
executive offices are located at Olympic Financial Center, 7825 Washington
Avenue South, Minneapolis, Minnesota 55439-2435, and its telephone number is
(612) 942-9880.
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THE CERTIFICATES
GENERAL
With respect to each Trust, one or more classes of Certificates of a given
series will be issued pursuant to Trust Documents to be entered into between the
Seller, Olympic Financial and the Owner Trustee, forms of which have been filed
as exhibits to the Registration Statement of which this Prospectus forms a part.
The following summary does not purport to be complete and is subject to, and is
qualified in its entirety by reference to, all of the material provisions of the
Trust Documents. Where particular provisions of or terms used in the Trust
Documents are referred to, the actual provisions (including definitions of
terms) are incorporated by reference as part of this summary.
Unless otherwise specified in the related Prospectus Supplement, each class
of Certificates will initially be represented by a single Certificate registered
in the name of the nominee of DTC (together with any successor depository
selected by the Seller, the "Depository"). See "Certain Information Regarding
the Securities -- Book-Entry Registration." Unless otherwise specified in the
related Prospectus Supplement, the Certificates evidencing interests in a Trust
will be available for purchase in denominations of $1,000 initial principal
amount and integral multiples thereof, except that one Certificate evidencing an
interest in such Trust may be issued in a denomination that is less than $1,000
initial principal amount. Certificates may be transferred or exchanged without
the payment of any service charge other than any tax or governmental charge
payable in connection with such transfer or exchange. Unless otherwise specified
in the related Prospectus Supplement, the Owner Trustee will initially be
designated as the registrar for the Certificates.
DISTRIBUTIONS OF INTEREST AND PRINCIPAL
The timing and priority of distributions, seniority, allocations of loss,
Pass-Through Rate and amount of or method of determining distributions with
respect to principal and interest (or, where applicable, with respect to
principal only or interest only) on the Certificates of any series will be
described in the related Prospectus Supplement. Distributions of interest on the
Certificates will be made on the dates specified in the related Prospectus
Supplement (each, a "Distribution Date") and, unless otherwise specified in the
related Prospectus Supplement, will be made prior to distributions with respect
to principal. A series may include one or more classes of Strip Certificates
entitled to (i) distributions in respect of principal with disproportionate,
nominal or no interest distribution, or (ii) interest distributions, with
disproportionate, nominal or no distributions in respect of principal. Each
class of Certificates may have a different Pass-Through Rate, which may be a
fixed, variable or adjustable Pass-Through Rate (and which may be zero for
certain classes of Strip Certificates), or any combination of the foregoing. The
related Prospectus Supplement will specify the Pass-Through Rate for each class
of Certificate, or the initial Pass-Through Rate and the method for determining
the Pass-Through Rate. Unless otherwise specified in the related Prospectus
Supplement, interest on the Certificates will be calculated on the basis of a
360-day year consisting of twelve 30-day months. Unless otherwise specified in
the related Prospectus Supplement, distributions in respect of the Certificates
will be subordinate to payments in respect of the Notes, if any, as more fully
described in the related Prospectus Supplement. Distributions in respect of
principal of any class of Certificates will be made on a pro rata basis among
all of the Certificateholders of such class.
In the case of a series of Certificates which includes two or more classes
of Certificates, the timing, sequential order, priority of payment or amount of
distributions in respect of principal, and any schedule or formula or other
provisions applicable to the determination thereof, of each such class shall be
as set forth in the related Prospectus Supplement.
THE NOTES
GENERAL
A series of Securities may include one or more classes of Notes issued
pursuant to the terms of an Indenture, a form of which has been filed as an
exhibit to the Registration Statement of which this Prospectus forms a part.
Unless otherwise specified in the related Prospectus Supplement, no Notes will
be issued as a part of any series. The following summary does not purport to be
complete and is subject to, and is qualified in its entirety by reference to,
all of the provisions of the Notes and the Indenture, and the
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following summary may be supplemented or superseded in whole or in part by the
related Prospectus Supplement. Where particular provisions of or terms used in
the Indenture are referred to, the actual provisions (including definition of
terms) are incorporated by reference as part of this summary.
Unless otherwise specified in the related Prospectus Supplement, each class
of Notes will initially be represented by a single Note registered in the name
of the nominee of the Depository. See "Certain Information Regarding the
Securities -- Book-Entry Registration." Unless otherwise specified in the
related Prospectus Supplement, Notes will be available for purchase in
denominations of $1,000 and integral multiples thereof. Notes may be transferred
or exchanged without the payment of any service charge other than any tax or
governmental charge payable in connection with such transfer or exchange. Unless
otherwise provided in the related Prospectus Supplement, the Indenture Trustee
will initially be designated as the registrar for the Notes.
PRINCIPAL AND INTEREST ON THE NOTES
The timing and priority of payment, seniority, allocations of loss, Interest
Rate and amount of or method of determining payments of principal and interest
on the Notes will be described in the related Prospectus Supplement. The right
of holders of any class of Notes to receive payments of principal and interest
may be senior or subordinate to the rights of holders of any class or classes of
Notes of such series, or any class of Certificates, as described in the related
Prospectus Supplement. Unless otherwise provided in the related Prospectus
Supplement, payments of interest on the Notes will be made prior to payments of
principal thereon. A series may include one or more classes of Strip Notes
entitled to (i) principal payments with disproportionate, nominal or no interest
payment, or (ii) interest payments with disproportionate, nominal or no
principal payments. Each class of Notes may have a different Interest Rate,
which may be a fixed, variable or adjustable Interest Rate (and which may be
zero for certain classes of Strip Notes), or any combination of the foregoing.
The related Prospectus Supplement will specify the Interest Rate for each class
of Notes, or the initial Interest Rate and the method for determining the
Interest Rate. One or more classes of Notes of a series may be redeemable under
the circumstances specified in the related Prospectus Supplement.
Unless otherwise specified in the related Prospectus Supplement, payments in
respect of interest to Noteholders of all classes within a series will have the
same priority. Under certain circumstances, the amount available for such
payments could be less than the amount of interest payable on the Notes on any
of the dates specified for payments in the related Prospectus Supplement (each,
a "Payment Date"), in which case each class of Noteholders will receive their
ratable share (based upon the aggregate amount of interest due to such class of
Noteholders) of the aggregate amount available to be distributed in respect of
interest on the Notes.
In the case of a series of Securities which includes two or more classes of
Notes, the sequential order and priority of payment in respect of principal and
interest, and any schedule or formula or other provisions applicable to the
determination thereof, of each such class will be set forth in the related
Prospectus Supplement. Unless otherwise specified in the related Prospectus
Supplement, payments in respect of principal and interest of any class of Notes
will be made on a pro rata basis among all of the Notes of such class.
THE INDENTURE
A form of Indenture has been filed as an exhibit to the Registration
Statement of which this Prospectus forms a part. The Seller will provide a copy
of the applicable Indenture (without exhibits) upon request to a holder of Notes
issued thereunder.
MODIFICATION OF INDENTURE WITHOUT NOTEHOLDER CONSENT. Each Trust and
related Indenture Trustee (on behalf of such Trust) may, with the consent of the
Security Insurer, if any (prior to an Insurer Default), but without consent of
the related Noteholders, enter into one or more supplemental indentures for any
of the following purposes: (i) to correct or amplify the description of the
collateral or add additional collateral; (ii) to provide for the assumption of
the Note and the Indenture obligations by a permitted successor to the Trust;
(iii) to add additional covenants for the benefit of the related Noteholders, or
to surrender any rights
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or power conferred upon the Trust; (iv) to convey, transfer, assign, mortgage or
pledge any property to or with the Indenture Trustee; (v) to cure any ambiguity
or correct or supplement any provision in the Indenture or in any supplemental
indenture; (vi) to provide for the acceptance of the appointment of a successor
Indenture Trustee or to add to or change any of the provisions of the Indenture
or in any supplemental indenture which may be inconsistent with any other
provision of the Indenture as shall be necessary and permitted to facilitate the
administration by more than one trustee; (vii) to modify, eliminate or add to
the provisions of the Indenture in order to comply with the Trust Indenture Act
of 1939, as amended; and (viii) to add any provisions to, change in any manner,
or eliminate any of the provisions of, the Indenture or modify in any manner the
rights of Noteholders under such Indenture; provided that any action specified
in this clause (viii) shall not, as evidenced by an opinion of counsel,
adversely affect in any material respect the interests of any related Noteholder
unless Noteholder consent is otherwise obtained as described below.
MODIFICATIONS OF INDENTURE WITH NOTEHOLDER CONSENT. With respect to each
Trust, with the consent of the Security Insurer, if any (prior to an Insurer
Default), and the holders representing a majority of the principal balance of
the outstanding related Notes (a "Note Majority"), the Owner Trustee and the
Indenture Trustee may execute a supplemental indenture to add provisions to
change in any manner or eliminate any provisions of, the related Indenture, or
modify in any manner the rights of the related Noteholders.
Without the consent of the Security Insurer, if any (prior to an Insurer
Default), and the holder of each outstanding related Note affected thereby,
however, no supplemental indenture may: (i) change the due date of any
installment of principal of or interest on any Note or reduce the principal
amount thereof, the interest rate specified thereon or the redemption price with
respect thereto or change the manner of calculating any such payment or any
place of payment where the coin or currency in which any Note or any interest
thereon is payable; (ii) impair the right to institute suit for the enforcement
of certain provisions of the Indenture regarding payment; (iii) reduce the
percentage of the aggregate amount of the outstanding Notes the consent of the
holders of which is required for any such supplemental indenture or the consent
of the holders of which is required for any waiver of compliance with certain
provisions of the Indenture or of certain defaults thereunder and their
consequences as provided for in the Indenture; (iv) modify or alter the
provisions of the Indenture regarding the voting of Notes held by the related
Trust, any other obligor on the Notes, the Seller or an affiliate of any of
them; (v) reduce the percentage of the aggregate outstanding amount of the Notes
the consent of the holders of which is required to direct the Indenture Trustee
to sell or liquidate the Receivables if the proceeds of such sale would be
insufficient to pay the principal amount and accrued but unpaid interest on the
outstanding Notes; (vi) decrease the percentage of the aggregate principal
amount of the Notes required to amend the sections of the Indenture which
specify the applicable percentage of aggregate principal amount of the Notes
necessary to amend the Indenture or certain other related agreements; or (vii)
permit the creation of any lien ranking prior to or on a parity with the lien of
the Indenture with respect to any of the collateral for the Notes or, except as
otherwise permitted or contemplated in the Indenture, terminate the lien of the
Indenture on any such collateral or deprive the holder of any Note of the
security afforded by the lien of the Indenture.
EVENTS OF DEFAULT; RIGHTS UPON EVENT OF DEFAULT. With respect to each
Trust, unless otherwise specified in the related Prospectus Supplement, "Events
of Default" under the Indenture will consist of: (i) a default for five days or
more in the payment of any interest on any Note; (ii) a default in the payment
of the principal of or any installment of the principal of any Note when the
same becomes due and payable; (iii) a default in the observance or performance
in any material respect of any covenant or agreement of the Trust made in the
Indenture, or any representation or warranty made by the Trust in the Indenture
or in any certificate delivered pursuant thereto or in connection therewith
having been incorrect as of the time made, and the continuation of any such
default or the failure to cure such breach of a representation or warranty for a
period of 30 days after notice thereof is given to the Trust by the Indenture
Trustee or to the Trust and the Indenture Trustee by the holders of at least 25%
in principal amount of the Notes then outstanding; or (iv) certain events of
bankruptcy, insolvency, receivership or liquidation of the Trust. However, the
amount of principal due and payable on any class of Notes on any Payment Date
(prior to the Final Scheduled Payment Date, if any, for such class) will
generally be determined by amounts available to be deposited in the
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Note Distribution Account for such Payment Date. Therefore, unless otherwise
specified in the related Prospectus Supplement, the failure to pay principal on
a class of Notes generally will not result in the occurrence of an Event of
Default unless such class of Notes has a Final Scheduled Payment Date, and then
not until such Final Scheduled Payment Date for such class of Notes.
Unless otherwise specified in the related Prospectus Supplement, if an Event
of Default should occur and be continuing with respect to the Notes of any
series, the related Indenture Trustee or a Note Majority may declare the
principal of the Notes to be immediately due and payable. Such declaration may,
under certain circumstances, be rescinded by a Note Majority.
Unless otherwise specified in the related Prospectus Supplement, if the
Notes of any series have been declared due and payable following an Event of
Default with respect thereto, the related Indenture Trustee may institute
proceedings to collect amounts due or foreclose on Trust Property, exercise
remedies as a secured party, sell the related Receivables or elect to have the
Trust maintain possession of such Receivables and continue to apply collections
on such Receivables as if there had been no declaration of acceleration. Unless
otherwise specified in the related Prospectus Supplement, the Indenture Trustee,
however, will be prohibited from selling the related Receivables following an
Event of Default, unless (i) the holders of all the outstanding related Notes
consent to such sale; (ii) the proceeds of such sale are sufficient to pay in
full the principal of and the accrued interest on such outstanding Notes at the
date of such sale; or (iii) the Indenture Trustee determines that the proceeds
of the Receivables would not be sufficient on an ongoing basis to make all
payments on the Notes as such payments would have become due if such obligations
had not been declared due and payable, and the Indenture Trustee obtains the
consent of the holders of 66 2/3% of the aggregate outstanding amount of the
Notes. Unless otherwise specified in the related Prospectus Supplement,
following a declaration upon an Event of Default that the Notes are immediately
due and payable, (i) Noteholders will be entitled to ratable repayment of
principal on the basis of their respective unpaid principal balances and (ii)
repayment in full of the accrued interest on and unpaid principal balances of
the Notes will be made prior to any further payment of interest or principal on
the Certificates.
Subject to the provisions of the Indenture relating to the duties of the
Indenture Trustee, if an Event of Default occurs and is continuing with respect
to a series of Notes, the Indenture Trustee will be under no obligation to
exercise any of the rights or powers under the Indenture at the request or
direction of any of the holders of such Notes, if the Indenture Trustee
reasonably believes it will not be adequately indemnified against the costs,
expenses and liabilities which might be incurred by it in complying with such
request. Subject to the provisions for indemnification and certain limitations
contained in the Indenture, a Note Majority in a series will have the right to
direct the time, method and place of conducting any proceeding or any remedy
available to the Indenture Trustee, and a Note Majority may, in certain cases,
waive any default with respect thereto, except a default in the payment of
principal or interest or a default in respect of a covenant or provision of the
Indenture that cannot be modified without the waiver or consent of all of the
holders of such outstanding Notes.
No holder of a Note of any series will have the right to institute any
proceeding with respect to the related Indenture, unless (i) such holder
previously has given to the Indenture Trustee written notice of a continuing
Event of Default, (ii) the holders of not less than 25% in principal amount of
the outstanding Notes of such series have made written request of the Indenture
Trustee to institute such proceeding in its own name as Indenture Trustee, (iii)
such holder or holders have offered the Indenture Trustee reasonable indemnity,
(iv) the Indenture Trustee has for 60 days failed to institute such proceeding,
(v) no direction inconsistent with such written request has been given to the
Indenture Trustee during such 60-day period by the holders of a majority in
principal amount of such outstanding Notes, and (vi) in the case of a series of
Securities with respect to which a Policy is issued, an Insurer Default shall
have occurred and be continuing.
If an Event of Default occurs and is continuing and if it is known to the
Indenture Trustee, the Indenture Trustee will mail to each Noteholder notice of
the Event of Default within 90 days after it occurs. Except in the case of a
failure to pay principal of or interest on any Note, the Indenture Trustee may
withhold the notice if and so long as it determines in good faith that
withholding the notice is in the interests of the Noteholders.
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In addition, each Indenture Trustee and the related Noteholders, by
accepting the related Notes, will covenant that they will not at any time
institute against the Seller or the related Trust any bankruptcy, reorganization
or other proceeding under any federal or state bankruptcy or similar law.
Neither the Indenture Trustee nor the Owner Trustee in its individual
capacity, nor any holder of a Certificate including, without limitation, the
Seller, nor any of their respective owners, beneficiaries, agents, officers,
directors, employees, affiliates, successors or assigns will, in the absence of
an express agreement to the contrary, be personally liable for the payment of
the related Notes or for any agreement or covenant of the related Trust
contained in the Indenture.
CERTAIN COVENANTS. Each Indenture will provide that the related Trust may
not consolidate with or merge into any other entity, unless (i) the entity
formed by or surviving such consolidation or merger is organized under the laws
of the United States or any state, (ii) such entity expressly assumes the
Trust's obligation to make due and punctual payments upon the Notes and the
performance or observance of every agreement and covenant of the Trust under the
Indenture, (iii) no Event of Default shall have occurred and be continuing
immediately after such merger or consolidation, (iv) the Owner Trustee has been
advised that the then current rating of the related Notes or Certificates then
in effect would not be reduced or withdrawn by the Rating Agencies as a result
of such merger or consolidation, (v) the Security Insurer, if any (prior to an
Insurer Default), has consented to such merger or consolidation, and (vi) the
Owner Trustee has received an opinion of counsel to the effect that such
consolidation or merger would have no material adverse tax consequence to the
Trust or to any related Noteholder or Certificateholder.
Each Trust will not, among other things, (i) except as expressly permitted
by the Indenture, the Purchase Agreement, the Trust Documents or certain related
documents for such Trust (collectively, the "Related Documents"), sell,
transfer, exchange or otherwise dispose of any of the assets of the Trust, (ii)
claim any credit on or make any deduction from the principal and interest
payable in respect of the related Notes (other than amounts withheld under the
Code or applicable state law) or assert any claim against any present or former
holder of such Notes because of the payment of taxes levied or assessed upon the
Trust, (iii) dissolve or liquidate in whole or in part, (iv) permit the validity
or effectiveness of the related Indenture to be impaired or permit any person to
be released from any covenants or obligations with respect to the related Notes
under such Indenture except as may be expressly permitted thereby, or (v) except
as expressly permitted by the Related Documents, permit any lien, charge,
excise, claim, security interest, mortgage or other encumbrance to be created on
or extend to or otherwise arise upon or burden the assets of the Trust or any
part thereof, or any interest therein or proceeds thereof.
No Trust may engage in any activity other than as specified under the
section of the related Prospectus Supplement entitled "The Trust." No Trust will
incur, assume or guarantee any indebtedness other than indebtedness incurred
pursuant to the related Notes and the related Indenture or otherwise in
accordance with the Related Documents.
ANNUAL COMPLIANCE STATEMENT. Each Trust will be required to file annually
with the related Indenture Trustee a written statement as to the fulfillment of
its obligations under the Indenture.
INDENTURE TRUSTEE'S ANNUAL REPORT. The Indenture Trustee will be required
to mail each year to all related Noteholders a brief report relating to its
eligibility and qualification to continue as Indenture Trustee under the related
Indenture, any amounts advanced by it under the Indenture, the amount, interest
rate and maturity date of certain indebtedness owing by the Trust to the
Indenture Trustee in its individual capacity, the property and funds physically
held by the Indenture Trustee as such and any action taken by it that materially
affects the Notes and that has not been previously reported.
SATISFACTION AND DISCHARGE OF INDENTURE. The Indenture will be discharged
with respect to the collateral securing the related Notes upon the delivery to
the related Indenture Trustee for cancellation of all such Notes or, with
certain limitations, upon deposit with the Indenture Trustee of funds sufficient
for the payment in full of all of such Notes.
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THE INDENTURE TRUSTEE
The Indenture Trustee for a series of Notes will be specified in the related
Prospectus Supplement. The Indenture Trustee may resign at any time, in which
event the Seller will be obligated to appoint a successor trustee acceptable to
the Security Insurer, if any (prior to an Insurer Default). The Seller may also
remove the Indenture Trustee, with the consent of the Security Insurer, if any
(prior to an Insurer Default), if the Indenture Trustee ceases to be eligible to
continue as such under the Indenture or if the Indenture Trustee becomes
insolvent. In such circumstances, the Seller will be obligated to appoint a
successor trustee acceptable to the Security Insurer, if any (prior to an
Insurer Default). Any resignation or removal of the Indenture Trustee and
appointment of a successor trustee will be subject to any conditions or
approvals, if any, specified in the related Prospectus Supplement and will not
become effective until acceptance of the appointment by a successor trustee.
CERTAIN INFORMATION REGARDING THE SECURITIES
BOOK-ENTRY REGISTRATION
Unless otherwise provided in the related Prospectus Supplement, the
Securities of each series will be registered in the name of Cede & Co., the
nominee of DTC. DTC is a limited-purpose trust company organized under the laws
of the State of New York, a member of the Federal Reserve System, a "clearing
corporation" within the meaning of the New York Uniform Commercial Code, and a
"clearing agency" registered pursuant to the provisions of Section 17A of the
Exchange Act. DTC accepts securities for deposit from its participating
organizations ("Participants") and facilitates the clearance and settlement of
securities transactions between Participants in such securities through
electronic book-entry changes in accounts of Participants, thereby eliminating
the need for physical movement of certificates. Participants include securities
brokers and dealers, banks and trust companies and clearing corporations and may
include certain other organizations. Indirect access to the DTC system is also
available to others such as banks, brokers, dealers and trust companies that
clear through or maintain a custodial relationship with a Participant, either
directly or indirectly ("indirect participants").
Certificate Owners and Note Owners who are not Participants but desire to
purchase, sell or otherwise transfer ownership of Securities may do so only
through Participants (unless and until Definitive Certificates or Definitive
Notes, each as defined below, are issued). In addition, Certificate Owners and
Note Owners will receive all distributions of principal of, and interest on, the
Securities from the Owner Trustee or the Indenture Trustee, as applicable,
through DTC and Participants. Certificate Owners and Note Owners will not
receive or be entitled to receive certificates representing their respective
interests in the Securities, except under the limited circumstances described
below and such other circumstances, if any, as may be specified in the related
Prospectus Supplement.
Unless and until Definitive Securities are issued, it is anticipated that
the only Certificateholder of the Certificates and the only Noteholder of the
Notes, if any, will be Cede & Co., as nominee of DTC. Certificate Owners and
Note Owners will not be recognized by the Owner Trustee as Certificateholders or
by the Indenture Trustee as Noteholders as those terms are used in the related
Trust Documents or Indenture. Certificate Owners and Note Owners will be
permitted to exercise the rights of Certificateholders or Noteholders, as the
case may be, only indirectly through Participants and DTC.
With respect to any series of Securities, while the Securities are
outstanding (except under the circumstances described below), under the rules,
regulations and procedures creating and affecting DTC and its operations (the
"Rules"), DTC is required to make book-entry transfers among Participants on
whose behalf it acts with respect to the Securities and is required to receive
and transmit distributions of principal of, and interest on, the Securities.
Participants with whom Certificate Owners or Note Owners have accounts with
respect to Securities are similarly required to make book-entry transfers and
receive and transmit such distributions on behalf of their respective
Certificate Owners and Note Owners. Accordingly, although Certificate Owners and
Note Owners will not possess Securities, the Rules provide a mechanism by which
Certificate Owners and Note Owners will receive distributions and will be able
to transfer their interests.
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With respect to any series of Securities, unless otherwise specified in the
related Prospectus Supplement, Certificates and Notes (if any) will be issued in
registered form to Certificate Owners and Note Owners, or their nominees, rather
than to DTC (such Certificates and Notes being referred to herein as "Definitive
Certificates" and "Definitive Notes," respectively), only if (i) DTC, the Seller
or the Servicer advises the Owner Trustee or the Indenture Trustee, as the case
may be, in writing that DTC is no longer willing or able to discharge properly
its responsibilities as nominee and depository with respect to the Certificates
or the Notes, and the Seller, the Servicer, the Owner Trustee or the Indenture
Trustee, as the case may be, is unable to locate a qualified successor, (ii) the
Seller or the Administrator (if any) at its sole option has advised the Owner
Trustee or the Indenture Trustee, as the case may be, in writing that it elects
to terminate the book-entry system through DTC and (iii) after the occurrence of
a Servicer Termination Event, the holders representing a majority of the
Certificate Balance (a "Certificate Majority") or a Note Majority advises the
Owner Trustee or the Indenture Trustee, as the case may be, through DTC, that
continuation of a book-entry system is no longer in their best interests. Upon
issuance of Definitive Certificates or Definitive Notes to Certificate Owners or
Note Owners, such Certificates or Notes will be transferable directly (and not
exclusively on a book-entry basis) and registered holders will deal directly
with the Owner Trustee or the Indenture Trustee, as the case may be, with
respect to transfers, notices and distributions.
DTC has advised the Seller that, unless and until Definitive Certificates or
Definitive Notes are issued, DTC will take any action permitted to be taken by a
Certificateholder or a Noteholder under the related Trust Documents or Indenture
only at the direction of one or more Participants to whose DTC accounts the
Certificates or Notes are credited. DTC has advised the Seller that DTC will
take such action with respect to any fractional interest of the Certificates or
the Notes only at the direction of and on behalf of such Participants
beneficially owning a corresponding fractional interest of the Certificates or
the Notes. DTC may take actions, at the direction of the related Participants,
with respect to some Certificates or Notes which conflict with actions taken
with respect to other Certificates or Notes.
Issuance of Certificates and Notes in book-entry form rather than as
physical certificates or notes may adversely affect the liquidity of
Certificates or Notes in the secondary market and the ability of the Certificate
Owners or Note Owners to pledge them. In addition, since distributions on the
Certificates and the Notes will be made by the Owner Trustee or the Indenture
Trustee to DTC and DTC will credit such distributions to the accounts of its
Participants, with the Participants further crediting such distributions to the
accounts of indirect participants or Certificate Owners or Note Owners,
Certificate Owners and Note Owners may experience delays in the receipt of such
distributions.
STATEMENTS TO SECURITYHOLDERS
On or prior to each Distribution Date, the Servicer will prepare and provide
to the Owner Trustee a statement to be delivered to the related
Certificateholders on such Distribution Date. On or prior to each Payment Date,
the Servicer will prepare and provide to the Indenture Trustee a statement to be
delivered to the related Noteholders on such Payment Date. Such statements will
be based on the information in the related Servicer's Certificate setting forth
certain information required under the Trust Documents (the "Servicer's
Certificate"). Unless otherwise specified in the related Prospectus Supplement,
each such statement to be delivered to Certificateholders will include the
following information as to the Certificates with respect to such Distribution
Date or the period since the previous Distribution Date, as applicable, and each
such statement to be delivered to Noteholders will include the following
information as to the Notes with respect to such Payment Date or the period
since the previous Payment Date, as applicable:
(i) the amount of the distribution allocable to interest on or with
respect to each class of Securities;
(ii) the amount of the distribution allocable to principal on or with
respect to each class of Securities;
(iii) the Certificate Balance and the Certificate Pool Factor for each
class of Certificates and the aggregate outstanding principal balance and
the Note Pool Factor for each class of Notes, after giving effect to all
payments reported under (ii) above on such date;
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(iv) the amount of the Servicing Fee paid to the Servicer with respect
to the related Monthly Period or Periods, as the case may be;
(v) the Pass-Through Rate or Interest Rate for the next period for any
class of Certificates or Notes with variable or adjustable rates;
(vi) the amount, if any, distributed to Certificateholders and
Noteholders applicable to payments under the related Policy or other form of
credit enhancement, if any; and
(vii) such other information as may be specified in the related
Prospectus Supplement.
Each amount set forth pursuant to subclauses (i), (ii), (iv), (vi) and (vii)
with respect to Certificates or Notes will be expressed as a dollar amount per
$1,000 of the initial Certificate Balance or the initial principal balance of
the Notes, as applicable.
Unless and until Definitive Certificates or Definitive Notes are issued,
such reports with respect to a series of Securities will be sent on behalf of
the related Trust to the Owner Trustee, the Indenture Trustee and Cede & Co., as
registered holder of the Certificates and the Notes and the nominee of DTC.
Certificate Owners and Note Owners may receive copies of such reports upon
written request, together with a certification that they are Certificate Owners
or Note Owners, as the case may be, and payment of any expenses associated with
the distribution of such reports, from the Owner Trustee or the Indenture
Trustee, as applicable. See "Reports to Securityholders" and "-- Book-Entry
Registration" above.
Within the prescribed period of time for tax reporting purposes after the
end of each calendar year during the term of a Trust, the Owner Trustee and the
Indenture Trustee, as applicable, will mail to each holder of a class of
Securities who at any time during such calendar year has been a Securityholder,
and received any payment thereon, a statement containing certain information for
the purposes of such Securityholder's preparation of federal income tax returns.
See "Certain Federal Income Tax Consequences."
LISTS OF SECURITYHOLDERS
Unless otherwise provided in the related Prospectus Supplement, with respect
to each series of Certificates, at such time, if any, as Definitive Certificates
have been issued, the Owner Trustee will, upon written request by three or more
Certificateholders or one or more holders of Certificates evidencing not less
than 25% of the Certificate Balance, within five Business Days after provision
to the Owner Trustee of a statement of the applicants' desire to communicate
with other Certificateholders about their rights under the related Trust
Documents or the Certificates and a copy of the communication that the
applicants propose to transmit, afford such Certificateholders access during
business hours to the current list of Certificateholders for purposes of
communicating with other Certificateholders with respect to their rights under
the Trust Documents. Unless otherwise specified in the related Prospectus
Supplement, the Trust Documents will not provide for holding any annual or other
meetings of Certificateholders.
Unless otherwise provided in the related Prospectus Supplement, with respect
to each series of Notes, if any, at such time, if any, as Definitive Notes have
been issued, the Indenture Trustee will, upon written request by three or more
Noteholders or one or more holders of Notes evidencing not less than 25% of the
aggregate principal balance of the related Notes, within five Business Days
after provision to the Indenture Trustee of a statement of the applicants'
desire to communicate with other Noteholders about their rights under the
related Indenture or the Notes and a copy of the communication that the
applicants propose to transmit, afford such Noteholders access during business
hours to the current list of Noteholders for purposes of communicating with
other Noteholders with respect to their rights under the Indenture. Unless
otherwise specified in the related Prospectus Supplement, the Indenture will not
provide for holding any annual or other meetings of Noteholders.
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DESCRIPTION OF THE PURCHASE AGREEMENTS AND THE
TRUST DOCUMENTS
Except as otherwise specified in the related Prospectus Supplement, the
following summary describes certain terms of the Purchase Agreements (each a
"Purchase Agreement") pursuant to which the Seller will purchase Receivables
from Olympic Financial, and certain terms of either (i) the Pooling and
Servicing Agreements or (ii) the Sale and Servicing Agreements and the Trust
Agreements (in either case collectively referred to as the "Trust Documents")
pursuant to which the Seller will sell and assign such Receivables to a Trust
and the Servicer will agree to service such Receivables on behalf of the Trust,
and pursuant to which such Trust will be created and Certificates will be
issued. Forms of the Purchase Agreement and the Trust Documents have been filed
as exhibits to the Registration Statement of which this Prospectus forms a part.
The Seller will provide a copy of such agreements (without exhibits) upon
request to a holder of Securities described therein. This summary does not
purport to be complete and is subject to, and qualified in its entirety by
reference to, all of the provisions of the Purchase Agreement and the Trust
Documents. Where particular provisions or terms used in the Purchase Agreement
and the Trust Documents are referred to, the actual provisions (including
definitions of terms) are incorporated by reference as part of such summary.
SALE AND ASSIGNMENT OF THE RECEIVABLES
On or prior to the Closing Date with respect to a series of Securities
specified in the related Prospectus Supplement, Olympic Financial will enter
into a Purchase Agreement with the Seller pursuant to which Olympic Financial
will, on or prior to such Closing Date, sell and assign to the Seller, without
recourse, its entire interest in and to the related Receivables, including its
security interest in the Financed Vehicles securing such Receivables and its
rights to receive all payments on, or proceeds with respect to, such Receivables
to the extent paid or payable after the applicable Cutoff Date. Pursuant to the
Purchase Agreement, Olympic Financial will agree that, upon the occurrence of a
Repurchase Event under the related Trust Documents with respect to any of the
Receivables of a Trust, the Owner Trustee on behalf of the Security Insurer (if
any) and the Certificateholders will be entitled to require Olympic Financial to
repurchase such Receivables from the Trust. Such rights of the Trust under the
Purchase Agreement will constitute part of the property of the Trust and may be
enforced directly by the Owner Trustee on behalf of the Security Insurer (if
any) and the Certificateholders. In addition, the Owner Trustee will pledge such
rights to the Indenture Trustee as collateral for the Notes, if any.
On the Closing Date, the Seller will sell and assign to the Owner Trustee,
without recourse, the Seller's entire interest in the related Receivables and
the proceeds thereof, including its security interests in the Financed Vehicles.
Each Receivable transferred by the Seller to the Trust will be identified in a
schedule appearing as an exhibit to the related Trust Documents (the "Schedule
of Receivables"). Concurrently with such sale and assignment, the Owner Trustee
will execute and deliver the related certificates representing the Certificates
to or upon the order of the Seller, and the Owner Trustee will execute and the
Indenture Trustee will authenticate and deliver the Notes, if any, to or upon
the order of the Seller.
Unless otherwise specified in the related Prospectus Supplement, in the
Purchase Agreement, Olympic Financial will warrant to the Seller and the Owner
Trustee, and in the Trust Documents, the Seller will warrant to the Owner
Trustee, among other things, that (except as otherwise specified in the related
Prospectus Supplement): (i) each Receivable (A) has created or will create a
valid, binding and enforceable first priority security interest in favor of
Olympic Financial in the Financed Vehicle (and, within 180 days after the
Closing Date, all title documents to the Financed Vehicles will show Olympic
Financial as first lienholder), which security interest has been validly
assigned by Olympic Financial to the Seller and by the Seller to the Owner
Trustee, (B) was originated by a Dealer for the retail sale of a Financed
Vehicle in the ordinary course of such Dealer's business, was fully and properly
executed by the parties thereto, was purchased by Olympic Financial from such
Dealer under an existing Dealer Agreement with Olympic Financial and was validly
assigned by such Dealer to Olympic Financial, (C) contains customary and
enforceable provisions adequate to enable realization against the collateral
security and (D) except for any Balloon Payment Receivables, is a fully
amortizing simple interest receivable which provides for level monthly payments
(other than with respect to the first and the final payments) which, if made
when due, will fully amortize the amount financed over the original term; (ii)
no selection procedures adverse to the
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Securityholders were utilized in selecting the Receivables from those
receivables owned by Olympic Financial which meet the selection criteria
contained in the Trust Documents; (iii) all requirements of applicable Federal,
state and local laws, and regulations thereunder, in respect of all of the
Receivables and each and every sale of the Financed Vehicles have been complied
with in all material respects; (iv) each Receivable represents the genuine,
legal, valid and binding payment obligation of the Obligor thereon, enforceable
in accordance with its terms, except as may be limited by laws affecting
creditors' rights generally or as may be modified by the application of the
Soldiers' and Sailors' Civil Relief Act of 1940, as amended (the "Relief Act");
(v) (A) immediately before the conveyance of each Receivable to the Trust, such
Receivable will be secured by an enforceable and validly perfected first
priority security interest in the Financed Vehicle in favor of the Seller as
secured party, (B) immediately after the conveyance of each Receivable to the
Trust, such Receivable will be secured by an enforceable and validly perfected
first priority security interest in the Financed Vehicle in favor of the Trust
as secured party or, in each case, all necessary and appropriate action has been
commenced and will be completed within 180 days that would result in such a
security interest and (C) as of the Cutoff Date there were no security
interests, liens, charges, pledges, preferences, equities or encumbrances of any
kind, claims or rights of others or claims for taxes, work, labor or materials
affecting a Financed Vehicle (each, a "Lien") which are or may be Liens prior or
equal to the Lien of the related Receivable; (vi) there has been no default,
breach, violation or event permitting acceleration under the terms of any
Receivable (other than payment delinquencies of not more than 30 days), and
there has been no waiver of any of the foregoing; and as of the Cutoff Date, no
Financed Vehicle had been repossessed; (vii) immediately prior to the conveyance
of the Receivables to the Seller, Olympic Financial had good and indefeasible
title thereto and was the sole owner thereof, free of any Lien; immediately
prior to the conveyance of the Receivables to the Trust, the Seller had good and
indefeasible title thereto and was the sole owner thereof, free of any Lien; and
upon conveyance of the Receivables by the Seller to the Trust pursuant to the
Trust Documents, the Trust will have good and indefeasible title to and will be
the sole owner of the Receivables, free of any Lien; (viii) no Dealer has a
participation in or other right to receive proceeds of any Receivable, and
neither Olympic Financial nor the Seller has taken any action to convey any
right to any person that would result in such person having a right to payments
received with respect to any Receivable; (ix) neither Olympic Financial nor the
Seller has done anything to convey any right to any person that would impair the
rights of the Trust, the Certificateholders or the Noteholders in any Receivable
or the proceeds thereof; (x) each Receivable was originated by a Dealer and was
sold by the Dealer to Olympic Financial without any fraud or misrepresentation
on the part of such Dealer; (xi) no Obligor is the United States of America or
any State or any agency, department, subdivision or instrumentality thereof;
(xii) no Receivable is assumable by another person in a manner that would
release the Obligor thereof from such Obligor's obligations to Olympic Financial
with respect to such Receivable; (xiii) no Receivable was originated in, or is
subject to the laws of, any jurisdiction the laws of which would make unlawful,
void or voidable the sale, transfer and assignment of such Receivable under the
Purchase Agreement or the Trust Documents or pursuant to transfers of the
Securities; (xiv) all filings and other actions required to be made, taken or
performed by any person in any jurisdiction to give the Trust a first priority
perfected lien or ownership interest in the Receivables will have been made,
taken or performed; (xv) there exists a Receivable File pertaining to each
Receivable, and such Receivable File contains (A) the fully executed original of
the Receivable, (B) a certificate of insurance or application form for insurance
signed by the Obligor, or copies thereof, (C) the original lien certificate or
application therefor and (D) a credit application signed by the Obligor, or a
copy thereof; each of such documents required to be signed by the Obligor has
been signed by the Obligor in the appropriate spaces, all blanks have been
properly filled in and each form has otherwise been correctly prepared; and the
complete Receivable File for each Receivable is in the possession of a
custodian; (xvi) there is only one original executed copy of each Receivable;
(xvii) the Receivables constitute chattel paper within the meaning of the UCC as
in effect in the States of New York and Minnesota; (xviii) each Receivable was
entered into by an Obligor who at the Cutoff Date had not been identified on the
records of Olympic Financial as being the subject of a current bankruptcy
proceeding; (xix) the computer tape containing information with respect to the
Receivables that was made available by the Seller to the Owner Trustee on the
Closing Date and was used to select the Receivables (the "Computer Tape") was
complete and accurate as of the Cutoff Date and includes a description of the
same Receivables that are described in the Schedule of Receivables; (xx) by the
Closing Date, the portions of the electronic master
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record of retail installment sale contracts and promissory notes of Olympic
Financial (the "Electronic Ledger") relating to the Receivables will have been
clearly and unambiguously marked to show that the Receivables constitute part of
the Trust Property and are owned by the Trust in accordance with the terms of
the Trust Documents; (xxi) the information set forth in the Schedule of
Receivables was produced from the Electronic Ledger and was true and correct in
all material respects as of the close of business on the Cutoff Date; (xxii) as
of the Closing Date, each Financed Vehicle was covered by a comprehensive and
collision insurance policy (A) in an amount at least equal to the lesser of (1)
its maximum insurable value or (2) the principal amount due from the Obligor
under the related Receivable, (B) naming Olympic Financial as loss payee and (C)
insuring against loss and damage due to fire, theft, transportation, collision
and other risks generally covered by comprehensive and collision insurance
coverage; and no Financed Vehicle was or had previously been insured under a
policy of force-placed insurance; (xxiii) no Receivable has been satisfied,
subordinated or rescinded; the Financed Vehicle securing each Receivable has not
been released from the lien of the related Receivable in whole or in part; and
no provision of a Receivable has been waived, altered or modified in any
respect, except by instruments or documents contained in the Receivable File;
(xxiv) no Receivable is subject to any right of rescission, set-off,
counterclaim or defense; (xxv) no Receivable was more than 30 days past due as
of the Cutoff Date and (xxvi) each Receivable had a remaining principal balance
as of the Cutoff Date equal to or greater than $500.00.
The warranties of Olympic Financial and the Seller will be made as of the
execution and delivery of each Purchase Agreement and the related Trust
Documents and will survive the sale, transfer and assignment of the related
Receivables and other Trust Property to the Trust but will speak only as of the
date made.
In the event of a breach by Olympic Financial of any representation or
warranty made by it in a Purchase Agreement with respect to a Receivable that
materially and adversely affects the interests of the Securityholders, the
Security Insurer (if any) or the Trust in that Receivable (any such breach by
Olympic Financial being a "Repurchase Event"), Olympic Financial, unless it
cures the breach by the second Accounting Date after the date on which Olympic
Financial becomes aware of or receives written notice from the Owner Trustee,
the Indenture Trustee, the Security Insurer, if any, or the Servicer of such
breach, will be obligated to repurchase the Receivable from the Trust. Any such
repurchase shall be made on the Deposit Date immediately following such second
Accounting Date at a price equal to the Purchase Amount as of such second
Accounting Date. The "Purchase Amount" of any Receivable means, with respect to
any Accounting Date, the outstanding principal balance of such Receivable as of
such Accounting Date, plus accrued and unpaid interest thereon. The "Deposit
Date" with respect to any Distribution Date is the Business Day immediately
preceding the Determination Date for such Distribution Date. An "Accounting
Date" is the last day (whether or not a Business Day) of any calendar month.
This repurchase obligation may be enforced by the Security Insurer (if any), or
by the Owner Trustee or the Indenture Trustee on behalf of the
Certificateholders and the Noteholders, respectively, and will constitute the
sole remedy available to the Certificateholders, the Noteholders, the Security
Insurer (if any), unless otherwise specified in the related Prospectus
Supplement, the Owner Trustee or the Indenture Trustee against Olympic Financial
or the Seller for any such uncured breach, except that pursuant to the Trust
Documents, Olympic Financial will indemnify the Owner Trustee, the Indenture
Trustee, the Trust, the Backup Servicer, the Collateral Agent, the Security
Insurer (if any), and the Certificateholders and Noteholders against losses,
damages, liabilities and claims which may be asserted against any of them as a
result of third-party claims arising out of the facts giving rise to such
breach.
Upon the purchase by Olympic Financial of a Warranty Receivable, the Owner
Trustee will convey such Receivable and the related Trust Property to Olympic
Financial.
CUSTODY OF RECEIVABLE FILES
Unless otherwise specified in the related Prospectus Supplement, Olympic
Financial initially will be appointed to act as custodian for the Receivable
Files of each Trust. Prior to any such appointment, the Trust and Olympic
Financial or such other institution specified in the related Prospectus
Supplement, as the case may be, shall enter into a custodian agreement pursuant
to which Olympic Financial or such other institution will agree to hold the
Receivable Files on behalf of the related Trust. Any such custodian agreement
may be terminated by the Trust and, if Olympic Financial is custodian, by the
Security Insurer, on 30 days' notice to
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Olympic Financial or such other institution or, in the case of termination by
the Security Insurer of Olympic Financial as custodian, immediately. If Olympic
Financial resigns or is terminated as the Servicer, any custodian agreement with
Olympic Financial shall terminate at the same time.
The Receivable Files, if held by Olympic Financial as custodian, will be
stamped or otherwise marked to indicate that such Receivables have been sold to
the related Trust. The Receivable Files will also be physically segregated.
Despite these precautions, if, through inadvertence or otherwise, any of the
Receivables were sold to another party (or a security interest therein were
granted to another party) that purchased (or took such security interest in) any
of such Receivables in the ordinary course of its business and took possession
of such Receivables, the purchaser (or secured party) would acquire an interest
in the Receivables superior to the interest of the related Trust if the
purchaser (or secured party) acquired (or took a security interest in) the
Receivables for new value and without actual knowledge of such Trust's interest.
See "Certain Legal Aspects of the Receivables -- Rights in the Receivables."
COLLECTIONS
With respect to each Trust, the Servicer will establish one or more
Collection Accounts in the name of the Owner Trustee or, in the case of any
series including one or more classes of Notes, in the name of the Indenture
Trustee for the benefit of the related Securityholders. If so specified in the
related Prospectus Supplement, the Owner Trustee will establish and maintain for
each series an account, in the name of the Owner Trustee on behalf of the
related Certificateholders, in which amounts released from the Collection
Account and any Pre-Funding Account and any amounts received from any source of
credit enhancement for distribution to such Certificateholders will be deposited
and from which all distributions to such Certificateholders will be made (the
"Certificate Distribution Account"). With respect to any series including one or
more classes of Notes, the Indenture Trustee will establish and maintain for
each series an account, in the name of the Indenture Trustee on behalf of the
related Noteholders, in which amounts released from the Collection Account and
any Pre-Funding Account and any amounts received from any source of credit
enhancement for payment to such Noteholders will be deposited and from which all
distributions to such Noteholders will be made (the "Note Distribution
Account"). The Collection Account, the Certificate Distribution Account (if
any), and the Note Distribution Account (if any), are referred to herein
collectively as the "Designated Accounts." Any other accounts to be established
with respect to a Trust will be described in the related Prospectus Supplement.
Each Designated Account will be an Eligible Account maintained with the
Owner Trustee, the Indenture Trustee and/or other depository institutions. An
"Eligible Account" is (i) a segregated trust account that is maintained with the
corporate trust department of a depository institution (acceptable to the
Security Insurer, if any, unless otherwise specified in the related Prospectus
Supplement) or (ii) a segregated demand deposit account maintained with a
depository institution or trust company organized under the laws of the United
States of America, or any of the states thereof, or the District of Columbia,
that has a certificate of deposit, short-term deposit or commercial paper rating
of at least A-1+ by S&P and P-1 by Moody's (the "Required Deposit Rating"), and
that is acceptable to the Security Insurer, if any (prior to an Insurer Default,
unless otherwise specified in the related Prospectus Supplement). On the Closing
Date specified in the related Prospectus Supplement, the Servicer will cause to
be deposited in the Collection Account all payments on the Receivables received
by the Servicer after the Cutoff Date and on or prior to the second Business Day
preceding the Closing Date (plus amounts on deposit in the Lockbox Account (as
defined below) on such second Business Day).
Unless otherwise specified in the related Prospectus Supplement, Olympic
Financial will take (or will have taken) steps to cause all payments by Obligors
on the Receivables held by any Trust to be made by check mailed to a bank
(initially Harris Trust and Savings Bank, unless otherwise provided in the
related Prospectus Supplement) acting as agent for the Owner Trustee and for
other owners of automobile receivables serviced by Olympic Financial (the
"Lockbox Bank"). Unless otherwise specified in the related Prospectus
Supplement, the identity of the Lockbox Bank may be changed at any time by the
Security Insurer, if any (prior to an Insurer Default). Unless otherwise
specified in the related Prospectus Supplement, all payments by check on the
Receivables and all payments made by automatic deduction from Obligors' checking
accounts will be deposited in a segregated account maintained by the Lockbox
Bank (the "Lockbox
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Account") and will be transferred by the Lockbox Bank into the Collection
Account within two Business Days of receipt. If the Servicer continues to
receive payments from any Obligor other than to the Lockbox Account, the
Servicer will take reasonable action to cause the Obligor to make such payments
to the Lockbox Account, including sending additional instruction letters to such
Obligor.
Unless otherwise specified in the related Prospectus Supplement, the
Servicer will deposit all payments on the Receivables held by any Trust received
directly by the Servicer from Obligors and all proceeds of Receivables collected
directly by the Servicer during each Monthly Period into the Collection Account
not later than the Business Day after receipt. Notwithstanding the foregoing and
unless otherwise provided in the related Prospectus Supplement, the Servicer may
utilize an alternative remittance schedule acceptable to the Servicer and the
Security Insurer, if any (prior to an Insurer Default), if the Servicer provides
to the Owner Trustee and the Indenture Trustee written confirmation from each
Rating Agency that such alternative remittance schedule will not result in the
downgrading or withdrawal by such Rating Agency of the rating(s) then assigned
to the Securities. Olympic Financial and the Servicer will also deposit into the
Collection Account on or before the Deposit Date the Purchase Amount of each
Warranty Receivable or Administrative Receivable to be purchased by it as of the
related Accounting Date.
For any series of Securities, funds in the Designated Accounts and any other
accounts identified in the related Prospectus Supplement will be invested, as
provided in the related Trust Documents, at the direction of the Servicer in
"Eligible Investments," consisting (unless otherwise specified in the related
Prospectus Supplement) of: interest-bearing obligations issued or guaranteed as
to principal and interest by the United States or any agency or instrumentality
of the United States, the obligations of which are backed by the full faith and
credit of the United States; interest-bearing obligations issued or guaranteed
by the Federal National Mortgage Association or the Federal Home Loan Mortgage
Corporation as long as such obligations are assigned the highest credit rating
by S&P and Moody's; demand or time deposits, certificates of deposit of and
certain other obligations of domestic depositary institutions with short-term
unsecured debt obligations assigned the highest credit rating by S&P and
Moody's; certain repurchase obligations with respect to the government
securities described above and entered into with a domestic depository
institution or trust company, the deposits of which are rated at least A-1+ by
S&P and P-1 by Moody's; certain corporate debt securities assigned the highest
credit rating by S&P and Moody's; certain commercial paper rated in the highest
credit rating category by S&P and Moody's; and certain other securities meeting
the criteria specified in the related Trust Documents. Eligible Investments
shall mature no later than the Business Day preceding the applicable
Distribution Date or Payment Date, as the case may be, for the Monthly Period to
which such amounts relate. Investments in Eligible Investments will be made in
the name of the Owner Trustee or the Indenture Trustee, as the case may be, and
such investments will not be sold or disposed of prior to their maturity.
Unless otherwise specified in the related Prospectus Supplement, collections
or recoveries on a Receivable (other than late fees or certain other similar
fees or charges) received during a Monthly Period and Purchase Amounts deposited
with the Owner Trustee prior to a Distribution Date will be applied first to any
outstanding Monthly Advances made by the Servicer with respect to such
Receivable, and then to interest and principal on the Receivable in accordance
with the terms of the Receivable.
As an administrative convenience and subject to certain conditions specified
in the Trust Documents, the Servicer will be permitted to make deposits of
amounts actually collected by it in a Monthly Period net of distributions to be
made to it with respect to such Monthly Period, which amounts may be netted
prior to any such remittance for the Monthly Period. The Servicer will account,
however, to the Owner Trustee, the Indenture Trustee, the Security Insurer, if
any, the Certificateholders and the Noteholders as if all such deposits and
distributions were made individually. The Servicer will be entitled to withhold,
or to be reimbursed from amounts otherwise payable into, or on deposit in, the
Collection Account with respect to a Monthly Period, amounts previously
deposited in the Collection Account but later determined to have resulted from
mistaken deposits or postings or checks returned for insufficient funds.
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SERVICING PROCEDURES
The Servicer will make reasonable efforts, consistent with the customary
servicing procedures employed by the Servicer with respect to Receivables owned
or serviced by it, to collect all payments due with respect to the Receivables
held by any Trust and, in a manner consistent with the Trust Documents, will
follow its customary collection procedures with respect to motor vehicle loans
that it services for itself and others.
Unless otherwise specified in the related Prospectus Supplement, the
Servicer will covenant in the related Trust Documents that it will not
be permitted to extend the monthly payments of a Receivable more than a
maximum of two times in any twelve-month period, six months in the aggregate,
and in no event beyond the last day of the Monthly Period immediately
preceding the Final Scheduled Distribution Date specified in the related
Prospectus Supplement. Except for the extensions described above and except for
changes in the day of the month on which the due date of a Receivable occurs or
the reamortization of scheduled payments following a partial principal
prepayment, the Servicer cannot, without the consent of the Security Insurer,
if any (prior to an Insurer Default) and, subject to the exceptions, if any,
specified in the related Prospectus Supplement, otherwise agree to amend or
modify any Receivable. Unless otherwise specified in the related Prospectus
Supplement, the Servicer may, with the consent of the Security Insurer, if any
(prior to an Insurer Default) and subject to certain other conditions, agree to
modify a Receivable to avoid a prepayment by the Obligor, provided that such
modification may not cause the APR on such Receivable to be below a rate
equal to the highest Interest Rate or Pass-Through Rate on the related
Securities plus 1.5%, nor may such modification cause the term of the
modified Receivable to extend beyond the last day of the Monthly Period
immediately preceding the Final Scheduled Distribution Date specified in the
related Prospectus Supplement. Under current Proposed Treasury Regulations,
depending on the characterization of the related Trust for federal income tax
purposes, no such modification of a Receivable may change the APR by more
than .25%. The Servicer will also covenant that it will not release a
Financed Vehicle from the security interest granted by the Receivable except
when the Receivable has been paid in full or as otherwise contemplated by the
Trust Documents.
Except as otherwise provided in the related Prospectus Supplement, upon the
discovery by any of the Servicer, the Security Insurer, if any, the Owner
Trustee or the Indenture Trustee, or receipt of written notice by the Servicer
of any breach by the Servicer of certain of its covenants that materially and
adversely affects the interests of a Trust, the Security Insurer (if any) or the
related Securityholders in a Receivable (an "Administrative Receivable"), unless
such breach shall have been cured by the second Accounting Date following the
Servicer's discovery or receipt of written notice of such breach, the Servicer
will be required to purchase the related Receivable for the Purchase Amount on
the related Deposit Date. The purchase obligation will constitute the sole
remedy available to the Security Insurer (if any), the Certificateholders, the
Owner Trustee on behalf of Certificateholders, the Noteholders or the Indenture
Trustee on behalf of Noteholders against the Servicer for any such uncured
breach, except with respect to certain indemnities of the Servicer under the
Trust Documents.
Under the Trust Documents, the Servicer will be required to use its best
efforts to repossess or otherwise comparably convert the ownership of any
Financed Vehicle securing a Receivable with respect to which the Servicer has
determined that payments thereunder are not likely to be resumed as soon as
practicable after default on such Receivable, but in no event later than the day
on which any portion of a Scheduled Payment has become 91 days delinquent. The
Servicer is authorized to follow such of its normal collection practices and
procedures as it deems necessary or advisable to realize upon any Receivable.
The Servicer may repossess and sell the Financed Vehicle securing such
Receivable at judicial sale, or take any other action permitted by applicable
law. See "Certain Legal Aspects of the Receivables." The Servicer will be
entitled to recover all reasonable expenses incurred by it in connection
therewith. The proceeds of such realization (net of such expenses) will be
deposited in the Collection Account at the time and in the manner described
above under "-- Collections."
The Trust Documents will provide that the Servicer will indemnify and defend
the Owner Trustee, the Indenture Trustee, the Backup Servicer, the Trust, the
Security Insurer (if any) and the Securityholders against, among other things,
any and all costs, expenses, losses, damages, claims and liabilities, including
reasonable fees and expenses of counsel and expenses of litigation, arising out
of or resulting from the use,
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ownership or operation by the Servicer or any affiliate thereof of any Financed
Vehicle or in respect of any action taken or failed to be taken by the Servicer
with respect to any portion of the Trust Property in violation of the provisions
of the Trust Documents. The Servicer's obligations to indemnify the Owner
Trustee, the Indenture Trustee, the Backup Servicer, the Trust, the Security
Insurer (if any) and the Securityholders for the Servicer's actions or omissions
will survive the removal of the Servicer but will not apply to any action or
omission of a successor Servicer.
SERVICING COMPENSATION
Unless otherwise specified in the related Prospectus Supplement, with
respect to each series of Securities, the Servicer will be entitled to receive
the Servicing Fee for each Monthly Period in an amount equal to the product of
one-twelfth of the Servicing Rate and the Aggregate Principal Balance as of the
first day of such Monthly Period. The Servicer also will be entitled to collect
and retain any late fees or other administrative fees or similar charges allowed
by the terms of the Receivables or applicable law. Unless otherwise provided in
the related Prospectus Supplement, the "Servicing Rate" will equal 1.00% per
annum calculated on the basis of a 360-day year consisting of twelve 30-day
months. The Servicing Fee and any additional servicing compensation will be paid
out of collections on or with respect to the Receivables prior to distributions
to Certificateholders and Noteholders. Unless otherwise specified in the related
Prospectus Supplement, a "Monthly Period" with respect to any Distribution Date
is the calendar month immediately preceding the month in which the Distribution
Date occurs.
Olympic Financial, as Servicer, will be required to pay all expenses
incurred by it in connection with its servicing activities (including fees,
expenses and disbursements of the Owner Trustee, the Indenture Trustee, the
Lockbox Bank, the Custodian and independent accountants, taxes imposed on the
Servicer and expenses incurred in connection with distributions and reports to
Certificateholders and Noteholders and the Security Insurer (if any)), except
certain expenses incurred in connection with realizing upon the Receivables.
MONTHLY ADVANCES
Unless otherwise provided in the related Prospectus Supplement, if the
amount deposited in the related Collection Account allocable to interest with
respect to any Receivable in any Monthly Period is less than the full amount of
interest accrued on such Receivable for the number of calendar days in such
Monthly Period (calculated according to the method specified in the related
retail installment sale contract or promissory note at the APR on the Principal
Balance of such Receivable as of the Accounting Date preceding such Distribution
Date), the Servicer will make a Monthly Advance equal to the amount of such
shortfall, provided that the Servicer shall not be required to make a Monthly
Advance with respect to a Receivable that is less than 31 days delinquent.
The Servicer will be reimbursed for any Monthly Advances from subsequent
payments or collections relating to the Receivable or from the Purchase
Amount of such Receivable, or in the case of a Liquidated Receivable, from
Liquidation Proceeds of such Receivable. If such Receivable becomes a
Liquidated Receivable and such Liquidation Proceeds are insufficient fully to
reimburse the Servicer, the Servicer will be entitled to be reimbursed from
collections on other Receivables. If, by reason of reimbursement of the
Servicer for Monthly Advances, there is a deficiency in a Scheduled Payment,
the Servicer will be obligated to advance the deficiency, subject to the
limitations described above.
DISTRIBUTIONS
With respect to each Trust, beginning on the Distribution Date or Payment
Date, as applicable, specified in the related Prospectus Supplement,
distributions of principal and interest (or, where applicable, of principal or
interest only) on each class of Securities entitled thereto will be made by the
Owner Trustee or the Indenture Trustee, as applicable, to the Certificateholders
and the Noteholders. The timing, calculation, allocation, order, source,
priorities of and requirements for all distributions to each class of
Certificateholders and all payments to each class of Noteholders will be set
forth in the related Prospectus Supplement.
CREDIT ENHANCEMENT
The amounts and types of credit enhancement arrangements and the provider
thereof, if applicable, with respect to each class of Securities will be set
forth in the related Prospectus Supplement. If and to the extent provided in the
related Prospectus Supplement, credit enhancement may be in the form of a
financial guaranty insurance policy, subordination of one or more classes of
Securities, reserve accounts, overcollateralization, letters of credit, credit
or liquidity facilities, repurchase obligations, third party payments or other
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support, cash deposits or such other arrangements as may be described in the
related Prospectus Supplement or any combination of two or more of the
foregoing. If specified in the applicable Prospectus Supplement, credit
enhancement for a series of Securities may cover one or more other series of
Securities.
The presence of credit enhancement is intended to enhance the likelihood of
receipt by the Certificateholders and the Noteholders of the full amount of
principal and interest due thereon and to decrease the likelihood that the
Certificateholders and the Noteholders will experience losses. Unless otherwise
specified in the related Prospectus Supplement, the credit enhancement for a
class of Securities will not provide protection against all risks of loss and
will not guarantee repayment of the entire principal and interest thereon. If
losses occur which exceed the amount covered by any credit enhancement or which
are not covered by any credit enhancement, Securityholders will bear their
allocable share of deficiencies. In addition, if a form of credit enhancement
covers more than one series of Securities, Securityholders of any such series
will be subject to the risk that such credit enhancement will be exhausted by
the claims of Securityholders of other series.
EVIDENCE AS TO COMPLIANCE
The Trust Documents will require the Servicer to cause a firm of independent
certified public accountants to furnish to the Owner Trustee and the Indenture
Trustee, the Security Insurer, if any, and each Rating Agency, on or before
March 31 of each year (or, if the Servicer's fiscal year ends on a date other
than December 31, the date 90 days after the end of the Servicer's fiscal year),
beginning on the first March 31 after the Closing Date, with respect to the
twelve months ended the immediately preceding December 31 or other fiscal
year-end (or such other period as shall have elapsed from the Closing Date to
the date of such certificate), a statement addressed to the Board of Directors
of the Servicer, to the Owner Trustee, the Indenture Trustee, the Backup
Servicer and the Security Insurer, if any, as to compliance by the Servicer
during such period with certain standards relating to the servicing of the
Receivables set forth in the Trust Documents. A copy of such statement may be
obtained by any Certificate Owner or Note Owner upon compliance with the
requirements described above. See "Certain Information Regarding the Securities
- -- Statements to Securityholders" above.
The Trust Documents will also provide for delivery to the Owner Trustee, the
Indenture Trustee, the Security Insurer, if any, and each Rating Agency, if any,
and the Backup Servicer, on or before March 31 (or, if the Servicer's fiscal
year ends on a date other than December 31, the date 90 days after the end of
the Servicer's fiscal year) of each year, beginning on the first March 31
following the Closing Date, of an officers' certificate signed by any two of the
president, any vice-president or assistant vice president, or the controller of
the Servicer (each, a "Servicer Responsible Officer"), dated as of December 31
of such year (or such other date on which the Servicer's fiscal year ends),
stating that (i) a review of the activities of the Servicer during the preceding
12-month period (or such other period as shall have elapsed from the Closing
Date to the date of the first such certificate) and of its performance under the
Trust Documents has been made under such officer's supervision, and (ii) to such
officer's knowledge, based on such review, the Servicer has fulfilled all its
obligations under the Trust Documents throughout such period, or, if there has
been a default in the fulfillment of any such obligation, specifying each such
default known to such officer and the nature and status thereof. A copy of such
certificate may be obtained by any Certificate Owner or Note Owner upon
compliance with the requirements described above. See "Certain Information
Regarding the Securities -- Statements to Securityholders" above.
CERTAIN MATTERS REGARDING THE SERVICER
Unless otherwise provided in the related Prospectus Supplement, if a Policy
has been issued with respect to a series of Securities, Olympic Financial's
appointment as Servicer under the related Trust Documents will run for
successive 90-day periods, subject to renewal by the Security Insurer, if any
(prior to an Insurer Default). It is expected that the Security Insurer (if any)
will renew Olympic Financial's appointment as Servicer until such time, if any,
as a Servicer Termination Event shall have occurred. Unless otherwise provided
in the related Prospectus Supplement, if an Insurer Default occurs or if no
Policy is
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issued with respect to a series, Olympic Financial's appointment as Servicer
under the related Trust Documents will continue until such time as it resigns,
is terminated as Servicer, or until such time, if any, as a Servicer Termination
Event shall have occurred under the related Trust Documents. The related Trust
Documents will provide that the Servicer may not resign from its obligations and
duties as Servicer thereunder, except upon a determination (as evidenced by an
opinion of independent counsel, delivered and acceptable to the Owner Trustee,
the Indenture Trustee and the Security Insurer, if any (prior to an Insurer
Default)), that by reason of a change in legal requirements its performance of
such duties would cause it to be in violation of such legal requirements in a
manner which would result in a material adverse effect on the Servicer. No such
resignation will become effective until the Backup Servicer or other successor
Servicer has assumed the servicing obligations and duties under the related
Trust Documents.
Unless otherwise provided in the related Prospectus Supplement, any
corporation or other entity into which the Servicer may be merged or
consolidated, resulting from any merger or consolidation to which the Servicer
is a party, which acquires by conveyance, transfer or lease substantially all of
the assets of the Servicer or succeeding to all or substantially all the
business of the Servicer, where the Servicer is not the surviving entity, which
corporation or other entity assumes every obligation of the Servicer under each
Trust Document, will be the successor to the Servicer under the related Trust
Documents; provided, however, that (i) such entity is an Eligible Servicer, (ii)
immediately after giving effect to such transaction, no Servicer Termination
Event, no event of default under the agreement (if any), providing for the
issuance of the Policy (the "Insurance Agreement") (prior to an Insurer Default)
and no event which, after notice or lapse of time, or both, would become a
Servicer Termination Event or an event of default under the related Insurance
Agreement, if any (prior to an Insurer Default), shall have occurred and be
continuing, (iii) the Servicer shall have delivered to the Owner Trustee, the
Indenture Trustee and the Security Insurer (if any) an officers' certificate and
an opinion of counsel each stating that such consolidation, merger or succession
and such agreement of assumption comply with the related Trust Documents and
that all conditions precedent provided for in the Trust Documents relating to
such transaction have been complied with, and (iv) the Servicer shall have
delivered 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 interests of the Owner Trustee and the Indenture Trustee in the
Receivables and the other Trust Property 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.
INDEMNIFICATION AND LIMITS ON LIABILITY
Unless otherwise specified in the related Prospectus Supplement, the Trust
Documents will provide that the Servicer will be liable only to the extent of
the obligations specifically undertaken by it under the Trust Documents and will
have no other obligations or liabilities thereunder. The Trust Documents will
further provide that neither the Servicer nor any of its directors, officers,
employees and agents will have any liability to the Trust, the
Certificateholders or the Noteholders or the Security Insurer, if any, except as
provided in the Trust Documents, for any action taken or for refraining from
taking any action pursuant to the Trust Documents, other than any liability that
would otherwise be imposed by reason of the Servicer's breach of the Trust
Documents or willful misfeasance, bad faith or negligence (including errors in
judgment) in the performance of its duties, or by reason of reckless disregard
of obligations and duties under the Trust Documents or any violation of law.
The Servicer may, with the prior consent of the Security Insurer, if any
(prior to an Insurer Default), the Owner Trustee, the Indenture Trustee, if any,
and the Backup Servicer, delegate duties under the related Trust Documents to
any of its affiliates. In addition, the Servicer may at any time perform the
specific duty of repossessing Financed Vehicles through subcontractors who are
in the business of servicing automotive receivables. The Servicer may also
perform other specific duties through subcontractors, with the prior consent of
the Security Insurer, if any (prior to an Insurer Default); provided, however,
that no such delegation of such duties by the Servicer shall relieve the
Servicer of its responsibility with respect thereto.
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SERVICER TERMINATION EVENTS
Unless otherwise provided in the related Prospectus Supplement, "Servicer
Termination Events" under the Trust Documents will consist of (i) any failure by
the Servicer to deliver to the Owner Trustee for distribution to
Certificateholders or the Indenture Trustee for distribution to Noteholders any
proceeds or payment required to be so delivered under the terms of the
Certificates, the Trust Documents, the Notes or the Indenture (or, for so long
as Olympic Financial is the Servicer, the Purchase Agreement) that continues
unremedied for a period of two Business Days after written notice is received by
the Servicer from the Owner Trustee, the Indenture Trustee or the Security
Insurer (if any), or after discovery of such failure by a responsible officer of
the Servicer; (ii) any failure by the Servicer to deliver to the Owner Trustee
and the Indenture Trustee and the Security Insurer, if any (prior to an Insurer
Default), certain reports required by the Trust Documents by the fourth Business
Day prior to the related Distribution Date; (iii) failure on the part of the
Servicer duly to observe or perform in any material respect any other covenants
or agreements of the Servicer set forth in the Certificates, the Trust
Documents, the Notes or the Indenture (or, for so long as Olympic Financial is
the Servicer, the Purchase Agreement), which failure (A) materially and
adversely affects the rights of Securityholders (determined without regard to
the availability of funds under any Policy) or of the Security Insurer, if any
(prior to an Insurer Default), and (B) continues unremedied for a period of 30
days after the date on which written notice of such failure, requiring the same
to be remedied, shall have been given to the Servicer by the Owner Trustee, the
Indenture Trustee or the Security Insurer, if any (or, if an Insurer Default
shall have occurred and be continuing, any Securityholder); (iv)(A) the
commencement of an involuntary case under the federal bankruptcy laws, as now or
hereinafter in effect, or another present or future federal or state bankruptcy,
insolvency or similar law (the "Bankruptcy Laws"), and such case is not
dismissed within 60 days; or (B) the entry of a decree or order for relief by a
court or regulatory authority having jurisdiction in respect of the Servicer or
the Seller under the Bankruptcy Laws, or appointing a receiver, liquidator,
assignee, trustee, custodian, sequestrator or other similar official of the
Servicer or the Seller or of any substantial part of their respective properties
or ordering the winding up or liquidation of the affairs of the Servicer or the
Seller; (v) the commencement by the Servicer or the Seller of a voluntary case
under any Bankruptcy Law, or the consent by the Servicer or the Seller to the
appointment of or taking possession by a receiver, liquidator, assignee,
trustee, custodian, sequestrator or other similar official of the Servicer or
the Seller or of any substantial part of the Servicer's or the Seller's property
or the making by the Servicer or the Seller of an assignment for the benefit of
creditors or the failure by the Servicer or the Seller generally to pay its
debts as such debts become due or the taking of corporate action by the Servicer
or the Seller in furtherance of any of the foregoing; (vi) any representation,
warranty or statement of the Servicer made in the Trust Documents or any
certificate, report or other writing delivered pursuant thereto shall prove to
be incorrect in any material respect as of the time when the same shall have
been made, and the incorrectness of such representation, warranty or statement
has a material adverse effect (determined without regard to the availability of
funds under any Policy) on the Trust and, within 30 days after written notice
thereof shall have been given to the Servicer by the Owner Trustee, the
Indenture Trustee or the Security Insurer, if any (or, if an Insurer Default
shall have occurred and be continuing, any Securityholder), the circumstances or
condition in respect of which such representation, warranty or statement was
incorrect shall not have been eliminated or otherwise cured; or (vii) if
applicable, unless an Insurer Default shall have occurred and be continuing, the
occurrence of an event of default under the Insurance Agreement.
Unless otherwise specified in the related Prospectus Supplement, if a
Servicer Termination Event occurs and is continuing, the Security Insurer, if
any (or, if no Policy was issued with respect to such series or an Insurer
Default shall have occurred and be continuing, the Owner Trustee, the Indenture
Trustee (if any), or a Certificate Majority or a Note Majority), by notice then
given in writing to the Servicer (and to the Owner Trustee and the Indenture
Trustee if given by the Security Insurer or the Securityholders) may terminate
all of the rights and obligations of the Servicer under the Trust Documents.
Immediately upon the giving of such notice, and, in the case of a successor
Servicer other than the Backup Servicer, the acceptance by such successor
Servicer of its appointment, all authority of the Servicer will pass to the
Backup Servicer or other successor Servicer. In addition to any other amounts
that are then payable to the outgoing Servicer
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under the related Trust Documents, the Servicer shall then be entitled to
receive reimbursements for any outstanding Monthly Advances. The Owner Trustee,
the Indenture Trustee and the successor Servicer may set off and deduct any
amounts owed by the Servicer from any amounts payable to the outgoing Servicer.
On and after the time the Servicer receives a notice of termination, the
Backup Servicer or other successor Servicer will be the successor in all
respects to the Servicer and will be subject to all the responsibilities,
restrictions, duties and liabilities of the Servicer under the related Trust
Documents; provided, however, that the successor Servicer shall have no
liability with respect to any obligation which was required to be performed by
the prior Servicer prior to the date that the successor Servicer becomes the
Servicer or any claim of a third party (including a Securityholder) based on any
alleged action or inaction of the prior Servicer. Unless otherwise specified in
the related Prospectus Supplement, if a Policy has been issued with respect to
the series, the Security Insurer may (prior to an Insurer Default) exercise at
any time its right to appoint as Backup Servicer or as successor to the Servicer
a person other than the Backup Servicer named in the related Prospectus
Supplement. Notwithstanding the above, if the Backup Servicer shall be legally
unable or shall be unwilling to act as Servicer, and if an Insurer Default shall
have occurred or if no Policy was issued with respect to such series, the Owner
Trustee, the Indenture Trustee, a Certificate Majority or a Note Majority may
petition a court of competent jurisdiction to appoint any Eligible Servicer as
the successor to the Servicer. Pending any such appointment, the Backup Servicer
shall act as successor Servicer unless it is legally unable to do so, in which
event the outgoing Servicer shall continue to act as Servicer until a successor
has been appointed and accepted such appointment. "Eligible Servicer" means a
person which, at the time of its appointment as Servicer, (A) is servicing a
portfolio of motor vehicle retail installment sales contracts and/or motor
vehicle installment loans, (B) is legally qualified and has the capacity to
service the Receivables, (C) has demonstrated the ability to service
professionally and competently a portfolio of motor vehicle retail installment
sales contracts and/or motor vehicle installment loans similar to the
Receivables in accordance with high standards of skill and care, and (D) is
qualified and entitled to use, pursuant to a license or other written agreement,
and agrees to maintain the confidentiality of, the software which the Servicer
uses in connection with performing its duties and responsibilities under the
related Trust Documents or otherwise has available software which is adequate to
perform its duties and responsibilities under such Trust Documents.
Any successor Servicer shall be entitled to such compensation payable out of
the Collection Account as the outgoing Servicer would have been entitled to
under the Trust Documents if the outgoing Servicer had not resigned or been
terminated.
Upon any termination of, or appointment of a successor to, the Servicer, the
Owner Trustee and the Indenture Trustee (if any) will each give prompt written
notice thereof to Certificateholders and Noteholders, respectively, at their
respective addresses appearing in the Certificate Register or the Note Register,
to the Security Insurer, if any (prior to an Insurer Default) and to each Rating
Agency.
Unless otherwise specified in the related Prospectus Supplement, if a Policy
has been issued with respect to a series, the Security Insurer (or, if an
Insurer Default shall have occurred and be continuing, a Certificate Majority or
Note Majority) may waive any Servicer Termination Event.
AMENDMENT
Unless otherwise provided in the related Prospectus Supplement, the Trust
Documents may be amended by the Seller, the Servicer, the Owner Trustee and the
Indenture Trustee, if any, with the prior written consent of the Security
Insurer, if any (prior to an Insurer Default), but without the consent of any of
the Securityholders, to cure any ambiguity or to correct or supplement any
provision therein, provided that such action will not, in the opinion of counsel
(which may be internal counsel to the Seller, Olympic Financial or the Servicer)
reasonably satisfactory to the Owner Trustee and the Indenture Trustee,
materially and adversely affect the interests of the Securityholders. The Trust
Documents may also be amended by the Seller, the Servicer and the Owner Trustee
and the Indenture Trustee (if any), with the prior written consent of the
Security Insurer, if any (prior to an Insurer Default), and a Certificate
Majority and a Note Majority (if applicable), for the purpose of adding any
provisions to or changing in any manner or eliminating any of the provisions of
the Trust Documents or of modifying, in any manner, the rights of the
Certificateholders or the
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Noteholders. No such amendment may (i) increase or reduce in any manner the
amount of, or accelerate or delay the timing of, collections of payments on the
related Receivables or distributions that are required to be made on any related
Certificate or Note or the related Pass-Through Rate or Interest Rate or (ii)
reduce the percentage of the Certificate Balance evidenced by Certificates or of
the aggregate principal amount of Notes then outstanding required to consent to
any such amendment, without the consent of the holders of all Certificates or
all Notes, as the case may be, then outstanding.
TERMINATION
Unless otherwise provided in the related Prospectus Supplement, with respect
to each Trust, the Trust and the respective obligations of the Seller, the
Servicer, the Security Insurer (if any), the Owner Trustee and the Indenture
Trustee pursuant to the related Trust Documents will terminate upon the later of
(i) the Distribution Date or Payment Date, as the case may be, immediately
following the maturity or other liquidation of the last Receivable (including
the Seller's or Servicer's purchase of the Receivables, as described below) or
(ii) payment to Certificateholders and Noteholders of all amounts required to be
paid to them pursuant to the related Trust Documents and the related Indenture
and the payment to the Security Insurer, if any, of all amounts payable or
reimbursable to it pursuant to the related Insurance Agreement, if any, and in
either case there shall be delivered to the Owner Trustee and the Indenture
Trustee an opinion of counsel that all applicable preference periods under
federal, state and local bankruptcy, insolvency and similar laws have expired
with respect to the payments made pursuant to clause (i) or (ii) above.
Unless otherwise provided in the related Prospectus Supplement, with respect
to each series of Securities, in order to avoid excessive administrative
expense, the Seller and Servicer each will be permitted, at its option (with the
consent of the Security Insurer, if any (prior to an Insurer Default), if such
purchase would result in a claim on the Policy or in an amount owing to the
Security Insurer under the Insurance Agreement remaining unpaid), to purchase
from the Trust, on any Distribution Date immediately following an Accounting
Date as of which the Aggregate Principal Balance is equal to or less than 10%
(or such other percentage as may be specified in the related Prospectus
Supplement) of the Cutoff Date Principal Balance, all remaining Receivables in
the related Trust and the other remaining Trust Property at a price equal to the
aggregate of the Purchase Amounts therefor and the appraised value of any other
remaining Trust Property. The exercise of this right will effect an early
retirement of the related Certificates and Notes.
If a General Partner is named in the related Prospectus Supplement, unless
otherwise specified in the related Prospectus Supplement, the Trust Agreement
will provide that, in the event that the sole remaining General Partner becomes
insolvent, withdraws or is expelled as a General Partner or is terminated or
dissolved, the Trust will terminate in 90 days and effect redemption of the
Notes (if any) and prepayment of the Certificates following the winding-up of
the affairs of the related Trust, unless within such 90 days holders of 100% of
the Certificates of such series agree in writing to the continuation of the
business of the Trust and to the appointment of a successor to the General
Partner, and the Owner Trustee is able to obtain an opinion of counsel
satisfactory to the Security Insurer (if any) to the effect that the Trust will
not thereafter be an association (or publicly traded partnership) taxable as a
corporation for federal income tax purposes.
Unless otherwise specified in the related Prospectus Supplement, with
respect to each series of Securities, the Owner Trustee will give written notice
of the final distribution with respect to the Certificates to each
Certificateholder of record and the Indenture Trustee will give written notice
of the final payment with respect to the Notes (if any), to each Noteholder of
record. The final distribution to any Certificateholder and the final payment to
any Noteholder will be made only upon surrender and cancellation of such
holder's Certificate or Note at the office or agency of the Owner Trustee, with
respect to Certificates, or of the Indenture Trustee, with respect to Notes,
specified in the notice of termination. Any funds remaining in the Trust, after
the Owner Trustee or the Indenture Trustee has taken certain measures to locate
a Certificateholder or Noteholder, as the case may be, and such measures have
failed, will be distributed to The United Way, and the Certificateholders and
Noteholders, by acceptance of their Certificates and Notes, will waive any
rights with respect to such funds.
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THE OWNER TRUSTEE
The Owner Trustee for each Trust will be specified in the related Prospectus
Supplement. The Owner Trustee, in its individual capacity or otherwise, and any
of its affiliates may hold Certificates or Notes in their own names or as
pledgee. In addition, for the purpose of meeting the legal requirements of
certain jurisdictions, the Owner Trustee, with the consent of the Servicer and
the Security Insurer, if any (so long as an Insurer Default shall not have
occurred and be continuing), shall have the power to appoint co-trustees or
separate trustees of all or any part of the related Trust. In the event of such
appointment, all rights, powers, duties and obligations conferred or imposed
upon the Owner Trustee by the related Trust Documents will be conferred or
imposed upon the Owner Trustee and such separate trustee or co-trustee jointly,
or, in any jurisdiction where the Owner Trustee is incompetent or unqualified to
perform certain acts, singly upon such separate trustee or co-trustee who shall
exercise and perform such rights, powers, duties and obligations solely at the
direction of the Owner Trustee.
The Owner Trustee of any Trust may resign at any time, in which event the
General Partner, if any, specified in the related Prospectus Supplement or, if
no such General Partner is specified, the Servicer or its successor will be
obligated to appoint a successor trustee, acceptable to the Security Insurer, if
any (prior to an Insurer Default). The General Partner, if any, specified in the
related Prospectus Supplement or, if no such General Partner is specified, the
Servicer may also remove the Owner Trustee, with the consent of the Security
Insurer, if any (prior to an Insurer Default), if the Owner Trustee ceases to be
eligible to serve, becomes legally unable to act, is adjudged insolvent or is
placed in receivership or similar proceedings. In such circumstances, the
General Partner, if any, specified in the related Prospectus Supplement or, if
no such General Partner is specified, the Servicer will be obligated to appoint
a successor trustee, acceptable to the Security Insurer, if any (prior to an
Insurer Default). Any resignation or removal of the Owner Trustee and
appointment of a successor trustee will not become effective until acceptance of
the appointment by the successor trustee.
DUTIES OF THE OWNER TRUSTEE
The Owner Trustee will make no representation as to the validity or
sufficiency of any Trust Document, the Certificates or the Notes (other than its
execution of the Certificates and the Notes), the Receivables, the Policy, if
any, or any related documents, and will not be accountable for the use or
application by the Servicer of any funds paid to the Servicer in respect of the
Certificates, the Notes or the Receivables prior to deposit in the related
Collection Account.
The Owner Trustee will be required to perform only those duties specifically
required of it under the Trust Documents. Generally, those duties will be
limited to the receipt of the various certificates, reports or other instruments
required to be furnished by the Servicer to the Owner Trustee under the Trust
Documents, in which case it will only be required to examine such certificates,
reports or instruments to determine whether they conform substantially to the
requirements of the Trust Documents.
The Owner Trustee will be under no obligation to exercise any of the rights
or powers vested in it by the Trust Documents or to institute, conduct, or
defend any litigation thereunder or in relation thereto at the request, order or
direction of any of the Certificateholders or Noteholders, unless such
Certificateholders or Noteholders have offered the Owner Trustee reasonable
security or indemnity against the costs, expenses and liabilities which may be
incurred therein or thereby. No Certificateholder nor any Noteholder will have
any right under the Trust Documents to institute any proceeding with respect to
such Trust Documents, unless such holder has given the Owner Trustee written
notice of default and unless the holders of Certificates evidencing not less
than 25% of the Certificate Balance or the holders of Notes evidencing not less
than 25% of the aggregate principal balance of the Notes then outstanding, as
the case may be, have made written request to the Owner Trustee to institute
such proceeding in its own name as Trustee thereunder and have offered to the
Owner Trustee reasonable indemnity, and the Owner Trustee for 30 days after the
receipt of such notice, request and offer to indemnify has neglected or refused
to institute any such proceedings. Certificateholders and Noteholders will not
have the right to make a claim directly under any Policy issued with respect to
such series, but in the event that the Owner Trustee or the Indenture Trustee
fails to make such a claim, Certificateholders and Noteholders may compel the
Owner Trustee or the Indenture Trustee, as applicable, to do so.
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THE BACKUP SERVICER
The Backup Servicer for each Trust will be specified in the related
Prospectus Supplement, although the Security Insurer, if any (prior to an
Insurer Default), may exercise its right at any time to appoint another Backup
Servicer. While Olympic Financial is the Servicer, the Backup Servicer will not
be liable or responsible for any obligation of the Servicer, and the
Certificateholders and Noteholders may look only to Olympic Financial to perform
such obligations. The Backup Servicer will be required to verify the monthly
Servicer's Certificate each month, to notify the Certificateholders, Noteholders
and the Security Insurer (if any) of any item that appears substantially out of
the ordinary, and to seek a written explanation thereof from the Servicer;
however, neither the Owner Trustee nor the Backup Servicer will be required to
otherwise monitor the Servicer. Upon the Servicer's receipt of a termination
notice after the occurrence of a Servicer Termination Event, the Backup Servicer
will automatically become the Servicer, unless the Security Insurer, if any
(prior to an Insurer Default), shall have appointed a different Backup Servicer
or successor Servicer. To facilitate the transfer of servicing responsibility,
the Servicer will deliver to the Owner Trustee and the Backup Servicer each
month a computer tape containing information with respect to the Receivables.
ADMINISTRATOR
If an Administrator is specified in the related Prospectus Supplement, such
Administrator will enter into an agreement (the "Administration Agreement")
pursuant to which such Administrator will agree, to the extent provided in such
Administration Agreement, to provide the notices and to perform other
administrative obligations required by the related Indenture and the Trust
Agreement.
CERTAIN LEGAL ASPECTS OF THE RECEIVABLES
RIGHTS IN THE RECEIVABLES
The Receivables are "chattel paper" as defined in the UCC as in effect in
the States of Minnesota and New York. Pursuant to the UCC, an ownership interest
in chattel paper may be perfected by possession or by filing a UCC-1 financing
statement in the state where the seller's principal executive office is located.
Accordingly, financing statements covering the Receivables will be filed by
Olympic Financial and the Seller in Minnesota. In addition, the documents
evidencing the Receivables initially will be held by the Custodian specified in
the related Prospectus Supplement on behalf of the related Trust.
The Servicer will be obligated from time to time to take such actions as are
necessary to continue the perfection of each Trust's interest in the related
Receivables and the proceeds thereof. Olympic Financial will warrant in each
Purchase Agreement with respect to the Receivables held by the related Trust,
and in the related Trust Document the Seller will assign the right to enforce
such warranties to the Owner Trustee on behalf of such Trust and the Owner
Trustee will pledge such right to the Indenture Trustee as collateral for the
Notes, if any, that, as of the Closing Date, such Receivables have not been
sold, pledged or assigned by Olympic Financial or the Seller to any other
person, and that it has good and indefeasible title thereto and is the sole
owner thereof free of any Liens and that, immediately upon the transfer of the
Receivables to such Trust pursuant to the related Trust Document, the Trust will
have good and indefeasible title to and will be the sole owner of the
Receivables, free of any Liens. In the event of an uncured breach of any of such
warranties in a Purchase Agreement that materially and adversely affects the
related Trust's, Certificateholders' or Noteholders' interest in any Receivable
(a "Repurchase Event"), Olympic Financial will be obligated to repurchase such
Receivable.
Unless otherwise provided in the related Prospectus Supplement, Olympic
Financial will hold the Receivable Files on behalf of each Trust under a
custodian agreement with the Trust. The Receivable Files, if held by Olympic
Financial as custodian, will be stamped or otherwise marked to indicate that
such Receivables have been sold to the related Trust. The Receivable Files will
also be physically segregated. Despite these precautions, if, through
inadvertence or otherwise, any of the Receivables were sold to another party (or
a security interest therein were granted to another party) that purchased (or
took such security interest in) any of such Receivables in the ordinary course
of its business and took possession of such Receivables, the purchaser (or
secured party) would acquire an interest in the Receivables superior to the
interest of the
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related Trust if the purchaser (or secured party) acquired (or took a security
interest in) the Receivables for new value and without actual knowledge of such
Trust's interest. See "Description of the Purchase Agreements and the Trust
Documents -- Custody of Receivable Files."
SECURITY INTERESTS IN THE FINANCED VEHICLES
Security interests in the Financed Vehicles must be perfected by notation of
the secured party's lien on the certificate of title or by such notation on or
actual possession of the certificate of title, depending on the law of the state
wherein the purchaser resides. The practice of Olympic Financial is to take such
action as is required to perfect its security interest under the laws of the
state in which the Financed Vehicle is registered. In the event of clerical
errors, administrative delays or otherwise, such actions may not have been taken
with respect to a Financed Vehicle and such security interest may be subordinate
to the interests of, among others, subsequent purchasers of the Financed
Vehicles, holders of perfected security interests in the Financed Vehicle, and
the trustee in bankruptcy of the Obligor. However, such failure would give rise
to a Repurchase Event and obligate Olympic Financial to repurchase the affected
Receivable if the interests of the related Certificateholders, Noteholders or
Trust were materially and adversely affected.
Pursuant to the related Trust Document, the Seller will assign the security
interests in the Financed Vehicles assigned to it by Olympic Financial under the
related Purchase Agreement to the Owner Trustee on behalf of the related Trust.
However, because of the administrative burden and expense that would be entailed
in doing so, none of Olympic Financial, the Seller, the Owner Trustee or the
Servicer will be required, except to the extent provided below, to amend the
certificates of title (or other lien certificates) to identify the Owner Trustee
(or the Seller) as the new secured party and, accordingly, Olympic Financial
will continue to be named as the secured party on the certificates of title (or
other lien certificate) relating to the Financed Vehicles. Further, the Servicer
will be required to note the interest of the related Trust on the certificates
of title for the Financed Vehicles only upon a Servicer Termination Event, or in
an event of default under the Insurance Agreement, if any (prior to an Insurer
Default), or (under certain circumstances and unless an Insurer Default shall
have occurred and be continuing) at the request of the Security Insurer, if any.
In most states, an assignment such as that under the related Trust Documents
should be an effective transfer of a security interest without amendment of any
lien noted on the related certificate of title, and the assignee should succeed
to the assignor's status as the secured party. In the absence of fraud or
forgery by the Obligor or administrative error by state recording officials, the
notation of the lien of Olympic Financial on the certificate of title should be
sufficient to protect the related Trust against the rights of subsequent
purchasers of a vehicle or subsequent lenders who take a security interest in
the related Financed Vehicle. However, in the absence of such an amendment, the
security interest of the related Trust in the related Financed Vehicles might be
defeated by, among others, the trustee in bankruptcy of Olympic Financial or the
Obligor. However, such failure would give rise to a Repurchase Event and
obligate Olympic Financial to repurchase the affected Receivable if the
interests of the related Certificateholders, Noteholders or Trust were
materially and adversely affected.
In most states, a perfected security interest in a motor vehicle continues
for four months after the vehicle is moved to a different state and thereafter
until the owner re-registers the motor vehicle in the new state, but in no event
beyond the surrender of the certificate of title. A majority of states require
surrender of a certificate of title to re-register a motor vehicle. Accordingly,
the secured party must surrender possession if it holds the certificate of title
to such vehicle. In the case of motor vehicles registered in states which
provide for notation of a lien but not possession of the certificate of title by
the holder of the security interest in the related motor vehicle, the secured
party should receive notice of surrender if the security interest in the vehicle
is noted on the certificate of title. Accordingly, the secured party should have
the opportunity to re-perfect its security interest in the vehicle in the state
of relocation. In states that do not require a certificate of title for
registration of a motor vehicle, re-registration could defeat perfection.
In the ordinary course of servicing its receivables portfolio, it is the
practice of Olympic Financial to effect such re-perfection upon receipt of
notice of re-registration or information from the Obligor as to relocation.
Similarly, when an Obligor sells a Financed Vehicle, Olympic Financial must
surrender possession of the certificate of title or receive notice as a result
of its lien noted thereon and accordingly should have an opportunity to require
satisfaction of the related Receivable before release of the lien. Under the
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related Trust Document, the Servicer will be obligated to take such steps, at
the Servicer's expense, as are necessary to maintain perfection of security
interest in such Financed Vehicle, and the failure to take such steps would
obligate the Servicer to purchase the related Receivable if such failure
materially and adversely affects the interests of the related
Certificateholders, Noteholders and Trust in such Receivables.
Under the laws of most states, liens for repairs performed on a motor
vehicle and liens for unpaid taxes take priority over even a perfected security
interest in a motor vehicle. The Seller in the related Trust Document (and
Olympic Financial in the related Purchase Agreement) will represent that,
immediately prior to the sale, assignment and transfer thereof to the related
Trust, each Receivable held by such Trust was secured by a valid, subsisting and
enforceable first priority perfected security interest in favor of the Seller
(or Olympic Financial), as secured party. However, liens for taxes, judicial
liens or liens arising by operation of law could arise at any time during the
term of a Receivable. In addition, the laws of certain states and federal law
permit the confiscation of motor vehicles by governmental authorities under
certain circumstances if used in unlawful activities, which may result in the
loss of a secured party's perfected security interest in the confiscated motor
vehicle. No notice will be given to the Owner Trustee, Indenture Trustee,
Certificateholders or Noteholders in the event such a lien or confiscation
arises, and if such lien arises or confiscation occurs after the date of
issuance of any series of Certificates and Notes, neither Olympic Financial nor
the Servicer will be required to repurchase or purchase the related Receivable.
REPOSSESSION
In the event of default by an Obligor, the owner of a retail installment
sales contract or installment loan has all the remedies of a secured party under
the UCC, except where specifically limited by other state laws. The remedies of
a secured party under the UCC include the right to repossession by self-help
means, unless such means would constitute a breach of the peace. Self-help
repossession is the method employed by Olympic Financial in most cases and is
accomplished simply by taking possession of the motor vehicle. In the event of
default by the Obligor, some jurisdictions require that the Obligor be notified
of the default and be given a time period within which he may cure the default
prior to repossession. In cases where the Obligor objects or raises a defense to
repossession, or if otherwise required by applicable state law, a court order
must be obtained from the appropriate state court, and the vehicle must then be
repossessed in accordance with that order. Other jurisdictions permit
repossession without notice, but only if the repossession can be accomplished
peacefully. If a breach of the peace cannot be avoided, judicial action is
required. A secured party may be held responsible for damages caused by a
wrongful repossession of a vehicle, including, in Florida, a wrongful
repossession conducted by an agent of the secured party. The Servicer will be
required to indemnify the related Trust for any liability imposed upon such
Trust as a result of a wrongful repossession. In Texas and many other states, a
vehicle may be repossessed without notice to the Obligor, but only if the
repossession can be accomplished without a breach of the peace.
NOTICE OF SALE; REDEMPTION RIGHTS
The UCC and various other state laws require a secured party who has
repossessed the collateral securing an obligation to provide an obligor with
reasonable notice of the date, time and place of any public sale and/or the date
after which any private sale of the collateral may be held. The obligor has the
right to redeem the collateral prior to actual sale by paying the secured party
the entire unpaid time balance of the obligation (less any unaccrued finance
charges) plus accrued default charges, reasonable expenses for repossessing,
holding and preparing the collateral for disposition and arranging for its sale,
plus, to the extent provided in the financing documents, reasonable attorneys'
fees, or in some states, by payment of delinquent installments or the unpaid
principal balance of the related obligation.
DEFICIENCY JUDGMENTS AND EXCESS PROCEEDS
The proceeds of resale of Financed Vehicles generally will be applied first
to the expenses of repossession and resale and then to the satisfaction of the
related Receivables. While some states impose prohibitions or limitations on
deficiency judgments if the net proceeds from resale do not cover the full
amount of the indebtedness, a deficiency judgment can be sought in other states
that do not prohibit or limit such judgments, subject to satisfaction of
statutory procedural requirements by the holder of the obligation. However, any
deficiency judgment would be a personal judgment against the Obligor for the
shortfall, and a
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defaulting Obligor can be expected to have very little capital or sources of
income available following repossession. Therefore, in many cases, it may not be
useful to seek a deficiency judgment or, if one is obtained, it may be settled
at a significant discount or not paid at all. Olympic Financial generally seeks
to recover any deficiency existing after repossession and sale of a Financed
Vehicle.
Occasionally, after resale of a repossessed motor vehicle, and payment of
all expenses and indebtedness, there is a surplus of funds. In that case, the
law of most states requires the secured party to remit the surplus to any holder
of another lien with respect to the vehicle, if proper notification of demand
for proceeds is received prior to distribution, or, if no such lienholder
exists, to remit the surplus to the former owner of the motor vehicle.
SOLDIERS' AND SAILORS' CIVIL RELIEF ACT
The Relief Act imposes certain limitations upon the actions of creditors
with respect to persons serving in the Armed Forces of the United States and, to
a more limited extent, their dependents and guarantors and sureties of debt
incurred by such persons. An obligation incurred by a person prior to entering
military service cannot bear interest at a rate in excess of 6% during the
person's term of military service, unless the obligee petitions a court which
determines that the person's military service does not impair his or her ability
to pay interest at a higher rate. Further, a secured party may not repossess
during a person's military service a motor vehicle subject to an installment
sales contract or a promissory note entered into prior to the person's entering
military service, for a loan default which occurred prior to or during such
service, without court action. The Relief Act imposes penalties for knowingly
repossessing property in contravention of its provisions. Additionally,
dependents of military personnel are entitled to the protection of the Relief
Act, upon application to a court, if such court determines the obligation of
such dependent has been materially impaired by reason of the military service.
To the extent an obligation is unenforceable against the person in military
service or a dependent, any guarantor or surety of such obligation will not be
liable for performance.
CONSUMER PROTECTION LAWS
Numerous Federal and state consumer protection laws and related regulations
impose substantive and disclosure requirements upon lenders and servicers
involved in consumer finance. Some of the Federal laws and regulations include
the Truth-in-Lending Act, the Equal Credit Opportunity Act, the Federal Trade
Commission Act, the Fair Credit Reporting Act, the Fair Debt Collection
Practices Act, the Motor Vehicle Information and Cost Savings Act (the "Odometer
Act"), the Magnuson-Moss Warranty Act, and the Federal Reserve Board's
Regulations B and Z.
In addition to Federal law, state consumer protection statutes regulate,
among other things, the terms and conditions of the motor vehicle retail
installment contracts and promissory notes pursuant to which purchasers finance
the acquisition of motor vehicles. These laws place finance charge ceilings on
the amount that a creditor may charge in connection with financing the purchase
of an automobile. These laws also impose other restrictions on consumer
transactions and require contract disclosures in addition to those required
under federal law. These requirements impose specific statutory liabilities upon
creditors who fail to comply. In some cases, this liability could affect the
ability of an assignee, such as the Trustee, to enforce consumer finance
contracts such as the Receivables. The "Credit Practices" Rule of the Federal
Trade Commission (the "FTC") imposes additional restrictions on contract
provisions and credit practices.
The FTC's so-called holder-in-due-course rule has the effect of subjecting
persons that finance consumer credit transactions (and certain related lenders
and their assignees) to all claims and defenses which the purchaser could assert
against the seller of the goods and services. An assignee's affirmative
liability to pay money to such aggrieved purchaser in the event of a successful
claim is limited to amounts paid by the purchaser under the consumer credit
contract. However, the assignee's ability to collect any balance remaining due
thereunder is subject to these claims and defenses. Accordingly, each Trust, as
assignee of the related Receivables, will be subject to claims or defenses, if
any, that the purchaser of the related Financed Vehicle may assert against the
seller of such vehicle. Under the motor vehicle dealer licensing laws of most
states, sellers of motor vehicles are required to be licensed to sell motor
vehicles at retail.
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In addition, with respect to used vehicles, the FTC's Rule on Sale of Used
Vehicles requires that all sellers of used vehicles prepare, complete, and
display a "Buyer's Guide" which explains the warranty coverage for such
vehicles. Federal regulations promulgated under the Odometer Act require that
all sellers of used vehicles furnish a written statement signed by the seller
certifying the accuracy of the odometer readings. If a seller is not properly
licensed or if either a Buyer's Guide or odometer disclosure statement was not
provided to the purchaser of a Financed Vehicle, the purchaser may be able to
assert a defense as to a retail installment sales contract or promissory note
against the seller of the motor vehicle.
Under the Texas Credit Code ("TCC") non-bank retail installment sellers and
their assignees are required to register with the Office of Consumer Credit
Commissioner of Texas. The TCC, like the UCCC, imposes disclosure and
substantive requirements on the sellers and any subsequent holder of such
contracts and imposes monetary penalties for violations thereof.
Courts have applied general equitable principles to secured parties pursuing
repossession or litigation involving deficiency balances. These equitable
principles may have the effect of relieving an Obligor from some or all of the
legal consequences of a default.
The Seller will warrant in the related Trust Document (and Olympic Financial
will warrant in the related Purchase Agreement) that as of the date of
origination each Receivable held by the related Trust complied with all
requirements of applicable law in all material respects. Accordingly, if such
Trust's interest in a Receivable were materially and adversely affected by a
violation of any such law, such violation would constitute a Repurchase Event
and would obligate Olympic Financial to repurchase the Receivable unless the
breach were cured. Under each Purchase Agreement, Olympic Financial will be
required to indemnify the related Trust for any liability resulting from the
failure of a Receivable to be in compliance with all requirements of law. See
"Description of the Purchase Agreements and the Trust Documents -- Sale and
Assignment of the Receivables."
OTHER LIMITATIONS
In addition to the laws limiting or prohibiting deficiency judgments,
numerous other statutory provisions, including Federal bankruptcy laws and
related state laws, may interfere with or affect the ability of a lender to
realize upon collateral or enforce a deficiency judgment. For example, in a
proceeding under Chapter 13 of the U.S. Bankruptcy Code of 1978, as amended, a
court may prevent a lender from repossessing a motor vehicle, and, as part of
the rehabilitation plan, reduce the amount of the secured indebtedness to the
market value of the motor vehicle at the time of bankruptcy (as determined by
the court), leaving the party providing financing as a general unsecured
creditor for the remainder of the indebtedness. A bankruptcy court may also
reduce the monthly payments due under a contract, change the rate of interest
and time of repayment of the indebtedness or substitute collateral securing such
indebtedness.
CERTAIN FEDERAL INCOME TAX CONSEQUENCES
The anticipated federal income tax consequences of the purchase, ownership
and disposition of each series of Securities will be discussed in the related
Prospectus Supplement. Such discussion will not deal with federal income tax
consequences applicable to all categories of investors, some of which may be
subject to special rules. Investors should consult their own tax advisors in
determining the federal, state, local and any other tax consequences to them of
the purchase, ownership and disposition of the Securities.
ERISA CONSIDERATIONS
Section 406 of the Employee Retirement Income Security Act of 1974, as
amended ("ERISA"), and Section 4975 of the Code prohibit a pension, profit
sharing or other employee benefit plan from engaging in certain transactions
involving "plan assets" with persons that are "parties in interest" under ERISA
or "disqualified persons" under the Code with respect to the plan. ERISA also
imposes certain duties and certain prohibitions on persons who are fiduciaries
of plans subject to ERISA. Under ERISA, generally any person who exercises any
authority or control with respect to the management or disposition of the assets
of a plan is considered to be a fiduciary of such plan. A violation of these
"prohibited transaction" rules may generate excise tax and other liabilities
under ERISA and the Code for such persons.
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Certain transactions involving the related Trust might be deemed to
constitute prohibited transactions under ERISA and the Code with respect to a
Benefit Plan that purchased Securities if assets of the related Trust were
deemed to be assets of the Benefit Plan. Under a regulation issued by the United
States Department of Labor (the "Plan Assets Regulation"), the assets of a Trust
would be treated as plan assets of a Benefit Plan for the purposes of ERISA and
the Code only if the Benefit Plan acquired an "equity interest" in the Trust and
none of the exceptions contained in the Plan Assets Regulation was applicable.
An equity interest is defined under the Plan Assets Regulation as an interest
other than an instrument which is treated as indebtedness under applicable local
law and which has no substantial equity features. The likely treatment of Notes
and Certificates will be discussed in the related Prospectus Supplement.
Employee benefit plans that are governmental plans (as defined in Section
3(32) of ERISA) and certain church plans (as defined in Section 3(33) of ERISA)
are not subject to ERISA requirements.
A plan fiduciary considering the purchase of Securities should consult its
tax and/or legal advisors regarding whether the assets of the Trust would be
considered plan assets, the possibility of exemptive relief from the prohibited
transaction rules and other issues and their potential consequences.
PLAN OF DISTRIBUTION
On the terms and conditions set forth in an underwriting agreement (the
"Underwriting Agreement") with respect to each Trust, the Seller will agree to
sell to each of the underwriters named therein and in the related Prospectus
Supplement, and each of such underwriters will severally agree to purchase from
the Seller, the principal amount of each class of Securities of the related
series set forth therein and in the related Prospectus Supplement.
In each Underwriting Agreement, the several underwriters will agree, subject
to the terms and conditions set forth therein, to purchase all the Securities
described therein which are offered hereby and by the related Prospectus
Supplement if any of such Securities are purchased. In the event of a default by
any such underwriter, each Underwriting Agreement will provide that, in certain
circumstances, purchase commitments of the nondefaulting underwriters may be
increased, or the Underwriting Agreement may be terminated.
Each Prospectus Supplement will either (i) set forth the price at which each
class of Securities being offered thereby will be offered to the public and any
concessions that may be offered to certain dealers participating in the offering
of such Securities or (ii) specify that the related Securities are to be resold
by the underwriters in negotiated transactions at varying prices to be
determined at the time of such sale. After the initial public offering of any
Securities, the public offering price and such concessions may be changed.
Each Underwriting Agreement will provide that Olympic Financial and the
Seller will indemnify the underwriters against certain liabilities, including
liabilities under the Securities Act.
The Indenture Trustee, if any, may, from time to time, invest the funds in
the Designated Accounts in Eligible Investments acquired from the underwriters.
Under each Underwriting Agreement, the closing of the sale of any class of
Securities subject thereto will be conditioned on the closing of the sale of all
other such classes.
The place and time of delivery for the Securities in respect of which this
Prospectus is delivered will be set forth in the related Prospectus Supplement.
LEGAL MATTERS
Certain matters with respect to the validity of the Certificates and the
Notes will be passed upon for the Seller by Dorsey & Whitney LLP, Minneapolis,
Minnesota. The validity of the Certificates and the Notes will be passed upon
for the underwriters named in the related Prospectus Supplement by Mayer, Brown
& Platt, New York, New York.
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INDEX OF DEFINED TERMS
<TABLE>
<CAPTION>
TERM PAGE
- --------------------------------------- ------------
<S> <C>
Accounting Date........................ 28
Administration Agreement............... 39
Administrative Receivables............. 11, 31
Aggregate Principal Balance............ 7
APR.................................... 15
Backup Servicer........................ 3
Balloon Payment Receivable............. 16
Bankruptcy Laws........................ 35
Certificateholders..................... 3
Certificate Distribution Account....... 29
Certificate Majority................... 24
Certificate Owners..................... 9
Certificate Pool Factor................ 16
Certificates........................... 1
Collection Account..................... 7
Commission............................. 2
Computer Tape.......................... 27
Cutoff Date............................ 1
Dealer Agreements...................... 12
Dealer Assignments..................... 12
Dealers................................ 5
Deposit Date........................... 28
Depository............................. 18
Definitive Certificates................ 24
Definitive Notes....................... 24
Designated Accounts.................... 29
Distribution Date...................... 18
DTC.................................... 1
Eligible Account....................... 29
Eligible Investments................... 30
Electronic Ledger...................... 28
Eligible Servicer...................... 36
Events of Default...................... 20
Exchange Act........................... 2
ERISA.................................. 43
Financed Vehicles...................... 5
FTC.................................... 42
Indenture.............................. 1
Indenture Trustee...................... 1, 3
Indirect participants.................. 23
Insolvency Laws........................ 10
Insurance Agreement.................... 34
Insurer Default........................ 8
Interest Rate.......................... 5
Lien................................... 27
Liquidated Receivable.................. 15
Liquidation Proceeds................... 7
Loan................................... 12
Lockbox Account........................ 29
Lockbox Bank........................... 29
Monthly Advance........................ 7
Monthly Period......................... 32
NADA................................... 13
Note Distribution Account.............. 29
Note Majority.......................... 20
<CAPTION>
TERM PAGE
- --------------------------------------- ------------
<S> <C>
Note Owners............................ 9
Note Pool Factor....................... 16
Noteholders............................ 4
Notes.................................. 1
Obligor................................ 7
Odometer Act........................... 42
Olympic Financial...................... 1
Owner Trustee.......................... 1, 3
Participants........................... 23
Pass-Through Rate...................... 3
Payment Date........................... 19
Plan Assets Regulation................. 44
Policy................................. 6
Pooling and Servicing Agreement........ 1
Pre-Funded Amount...................... 6
Pre-Funding Account.................... 4
Pre-Funding Period..................... 4
Prospectus Supplement.................. 1
Purchase Agreement..................... 6, 26
Purchase Amount........................ 28
Rating Agency.......................... 9
Receivable Files....................... 12
Receivables............................ 1, 5
Receivables Pool....................... 5
Registration Statement................. 2
Related Documents...................... 22
Relief Act............................. 27
Repurchase Event....................... 6, 8, 28, 39
Required Deposit Rating................ 29
Rules.................................. 23
Sale and Servicing Agreement........... 1
Scheduled Payment...................... 15
Schedule of Receivables................ 26
Securities............................. 1
Securitization......................... 17
Security Insurer....................... 6
Securityholders........................ 2
Seller................................. 1, 3
Servicer............................... 3
Servicer Responsible Officer........... 33
Servicer's Certificate................. 24
Servicer Termination Events............ 35
Servicing Fee.......................... 7
Servicing Rate......................... 32
Strip Certificates..................... 4
Strip Notes............................ 5
Subsequent Receivables................. 1, 6
TCC.................................... 43
Trust.................................. 1, 3
Trust Agreement........................ 1
Trust Documents........................ 1, 26
Trust Property......................... 1, 5
UCC.................................... 10
Underwriting Agreement................. 44
Warranty Receivables................... 11
</TABLE>
45
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
The following table sets forth the expenses to be incurred in connection
with the offering of the Automobile Receivables-Backed Certificates and the
Automobile Receivables-Backed Notes, other than underwriting discounts and
commissions, described in this Registration Statement:
<TABLE>
<S> <C>
Securities and Exchange Commission Registration Fee......... $ 1,212,122
Printing and Engraving...................................... 1,500,000
Legal Fees and Expenses..................................... 3,000,000
Blue Sky Filing and Counsel Fees............................ 600,000
Accounting Fees and Expenses................................ 500,000
Trustee Fees and Expenses................................... 1,200,000
Rating Agencies' Fees....................................... 2,000,000
Miscellaneous Expenses...................................... 87,878
-------------------
Total....................................................... $ 10,100,000
-------------------
-------------------
<FN>
- ------------------------
* All fees and expenses, other than the Securities and Exchange Commission
Registration Fee, are estimated.
</TABLE>
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Olympic Receivables Finance Corp. is incorporated under the laws of
Delaware. Section 145 of the Delaware General Corporation Law provides that a
Delaware corporation may indemnify any persons, including officers and
directors, who are, or are threatened to be made, parties to any threatened,
pending or completed action, suit or proceeding, whether civil, criminal,
administrative or investigative (other than an action by or in the right of such
corporation, by reason of the fact that such person was an officer, director,
employee or agent of such corporation, or is or was serving at the request of
such corporation as a director, officer, employee or agent of another
corporation or enterprise). The indemnity may include expenses (including
attorneys' fees), judgments, fines and amounts paid in settlement actually and
reasonably incurred by such person in connection with such action, suit or
proceedings, provided such person acted in good faith and in a manner he
reasonably believed to be in or not opposed to the corporation's best interests
and, for criminal proceedings, had no reasonable cause to believe that his
conduct was illegal. A Delaware corporation may indentify officers and directors
in an action by or in the right of the corporation under the same conditions,
except that no indemnification is permitted without judicial approval if the
officer or director is adjudged to be liable to the corporation. Where an
officer or director is successful on the merits or otherwise in the defense of
any action referred to above, the corporation must indemnify him against the
expenses which such officer or director actually and reasonably incurred.
The Certificate of Incorporation and Bylaws of Olympic Receivables Finance
Corp. provide, in effect, that, subject to certain limited exceptions, such
corporation will indemnify its officers and directors to the extent permitted by
the Delaware General Corporation Law.
ITEM 16. EXHIBITS.
The Exhibits filed as part of this Registration Statement are:
<TABLE>
<C> <C> <S>
1.1 -- Form of Underwriting Agreement (incorporated by reference to Exhibit 1.1
to the registrant's Current Report on Form 8-K, dated August 17, 1993).
3.1 -- Certificate of Incorporation of the Seller (incorporated by reference to
Exhibit 3.1 to the registrant's Registration Statement No. 33-57906, and,
as amended, to Exhibit 3.1 to the registrant's Registration Statement No.
33-62178).
3.2 -- By-Laws of the Seller (incorporated by reference to Exhibit 3.2 to the
registrant's Registration Statement No. 33-57906, and, as amended, to
Exhibit 3.2 to the registrant's Registration Statement No. 33-62178).
</TABLE>
II-1
<PAGE>
<TABLE>
<C> <C> <S>
4.1 -- Form of Pooling and Servicing Agreement between the Seller, the Servicer
and the Owner Trustee, including OFL Grantor Trusts Standard Terms and
Conditions of Agreement Effective January 31, 1995 (incorporated by
reference to Exhibit 4.1 to the registrant's Current Report on Form 8-K
dated January 31, 1995).
4.2 -- Form of Sale and Servicing Agreement relating to Trusts including
Pre-Funding Accounts or issuing Notes (incorporated by reference to
Exhibit 4.3 to the registrant's Current Report on Form 8-K, dated
September 21, 1995).
4.3 -- Form of Trust Agreement relating to Trusts including Pre-Funding Accounts
or issuing Notes (incorporated by reference to Exhibit 4.1 to the
registrant's Current Report on Form 8-K, dated September 21, 1995).
4.4 -- Form of Indenture between the Trust and the Indenture Trustee, including
form of Note (incorporated by reference to Exhibit 4.2 to the
registrant's Current Report on Form 8-K, dated September 21, 1995).
5.1 -- Opinion and consent of Dorsey & Whitney LLP with respect to
legality.
8.1 -- Opinion and consent of Dorsey & Whitney LLP with respect to tax
matters (to be filed by amendment).
10.1 -- Form of Purchase Agreement between the Seller and Olympic Financial Ltd.
(incorporated by reference to Exhibit 10.1 to the registrant's
Registration Statement, No. 33-62178).
23.1 -- Consent of Dorsey & Whitney LLP (included as part of Exhibit 5.1).
23.2 -- Consent of Dorsey & Whitney LLP (included as part of Exhibit 8.1).
25.1 -- Form of T-1 Statement of Eligibility under the Trust Indenture Act of
1939 of the Indenture Trustee (to be filed by amendment).
99.1 -- Form of Prospectus Supplement for Grantor Trusts (incorporated by
reference to Exhibit 99.1 to the registrant's Registration Statement, No.
33-75328).
99.2 -- Form of Prospectus Supplement for Trusts including Pre-Funding Accounts
or issuing Notes (incorporated by reference to Exhibit 99.2 to the
registrant's Registration Statement, No. 33-75328).
</TABLE>
ITEM 17. UNDERTAKINGS.
The undersigned registrant on behalf of the Trust hereby undertakes that,
for purposes of determining any liability under the Securities Act of 1933, each
filing of the Owner Trust's annual report pursuant to section 13(a) or section
15(d) of the Securities Exchange Act of 1934 that is incorporated by reference
in the registration statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
Insofar as indemnification for liabilities arising under the Securities Act
of 1933 may be permitted to directors, officers, and controlling persons of the
registrant pursuant to the foregoing provisions, or otherwise, the registrant
has been advised that, in the opinion of the Securities and Exchange Commission,
such indemnification is against public policy as expressed in the Act and is,
therefore, unenforceable. In the event that a claim for indemnification against
such liabilities (other than the payment by the registrant of expenses incurred
or paid by a director, officer or controlling person of the registrant in the
successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Act and will be governed by the final adjudication of
such issue.
The undersigned registrant hereby undertakes:
(1) For purposes of determining any liability under the Securities Act
of 1933, the information omitted from the form of prospectus filed as part
of this Registration Statement in reliance upon
II-2
<PAGE>
Rule 430A and contained in a form of prospectus filed by the registrant
pursuant to Rule 424(b)(1) or (4) or 497(h) under the Securities Act shall
be deemed to be part of this Registration Statement as of the time it was
declared effective.
(2) For the purpose of determining any liability under the Securities
Act of 1933, each post-effective amendment that contains a form of
prospectus shall be deemed to be a new registration statement relating to
the securities offered therein, and the offering of such securities at that
time shall be deemed to be the initial bona fide offering thereof.
The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made,
a post-effective amendment to this registration statement:
(i) To include any prospectus required by section 10(a)(3) of the
Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising after
the effective date of the registration statement (or the most recent
post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change to such information in the
registration statement. Notwithstanding the foregoing, any increase or
decrease in volume of securities offered (if the total dollar value of
securites offered would not exceed that which was registered) and any
deviation from the low or high end of the estimated maximum offering
range may be reflected in the form of prospectus filed with the
Commission pursuant to Rule 424(b) if, in the aggregate, the changes in
volume and price represent no more than a 20% change in the maximum
aggregate offering price set forth in the "Calculation of Registration
Fee" table in the effective Registration Statement.
(iii) To include any material information with respect to the plan of
distribution not previously disclosed in the registration statement or
any material change in the information set forth in the registration
statement;
Provided, however, that paragraphs (1)(i) and (1)(ii) do not apply if the
information required to be included in a post-effective amendment by
those paragraphs is contained in periodic reports filed by the registrant
pursuant to section 13 or section 15(d) of the Securities Exchange Act of
1934 that are incorporated by reference in the registration statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed
to be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed to
be the initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the
termination of the offering.
The undersigned registrant hereby undertakes to file an application for the
purpose of determining the eligibility of the trustee to act under subsection
(a) of section 310 of the Trust Indenture Act in accordance with the rules and
regulations prescribed by the Commission under section 305(b)(2) of the Trust
Indenture Act.
II-3
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
registrant certifies that it has reasonable grounds to believe that it meets
all of the requirements for filing on Form S-3 and has duly caused this
Registration Statement to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of Minneapolis, State of Minnesota, on
the 13th day of December, 1996.
OLYMPIC RECEIVABLES FINANCE CORP.
By /s/ Warren Kantor
----------------------------------
Warren Kantor
Acting Chief Executive Officer,
Vice President and Director
Pursuant to the requirements of the Securities Act, this Registration
Statement has been signed by the following persons in the capacities
indicated on December 13, 1996. Each person whose signature to this
Registration Statement appears below hereby constitutes and appoints Warren
Kantor as his true and lawful attorney-in-fact and agent, with full power of
substitution, to sign on his behalf individually and in the capacity stated
below and to perform any acts necessary to be done in order to file all
amendments and post-effective amendments to this Registration Statement, and
any and all instruments or documents filed as part of or in connection with
this Registration Statement or the amendments thereto and each of the
undersigned does hereby ratify and confirm all that said attorney-in-fact and
agent, or his substitutes, shall do or cause to be done by virtue hereof.
SIGNATURE TITLE
- -------------------------------------------------- ----------------------------
/s/ Warren Kantor
------------------------------------------- Acting Chief Executive
Warren Kantor Officer, Vice President
and Director (principal
financial officer)
Senior Vice President, Chief
/s/ John A. Witham Financial Officer and
------------------------------------------- Director (principal
John A. Witham financial officer)
/s/ Scott A. Anderson Vice President and
------------------------------------------- Director
Scott A. Anderson
Vice President, Assistant
/s/ Brian S. Anderson Secretary and Director
------------------------------------------- (principal accounting
Brian S. Anderson officer)
/s/ Brian DeBates
------------------------------------------- Director
Brian DeBates
II-4
<PAGE>
EXHIBIT INDEX
<TABLE>
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NUMBER DESCRIPTION NUMBER
- ----------- -------------------------------------------------------------------------------------------- ---------------
<C> <S> <C>
5.1 Opinion and consent of Dorsey & Whitney LLP with respect to legality.
</TABLE>
<PAGE>
[DORSEY & WHITNEY LLP LETTERHEAD]
EXHIBIT 5.1
Olympic Receivables Finance Corp.
7825 Washington Avenue South, Suite 410
Minneapolis, Minnesota 55439-2435
Re: Registration Statement on Form S-3
Ladies and Gentlemen:
We have acted as counsel to Olympic Receivables Finance Corp., a
Delaware corporation (the "Seller"), in connection with the preparation of
a Registration Statement on Form S-3 filed by the Seller with the Securities
and Exchange Commission on December 17, 1996 (the "Registration Statement"),
relating to the registration by the Seller of $4,000,000,000 of Automobile
Receivables-Backed Certificates (the "Certificates") and Automobile
Receivables-Backed Notes (the "Notes"). The Certificates will be issued from
time to time by trusts (each a "Trust") to be established by the Seller
pursuant to either (a) a Pooling and Servicing Agreement (the "Pooling and
Servicing Agreement"), substantially in the form filed as an exhibit to the
Registration Statement, to be entered into among the Seller, Olympic Financial
Ltd., in its individual capacity and as servicer ("Olympic Financial"), and
the Owner Trustee (the "Owner Trustee") for any such Trust specified in a
prospectus supplement to the prospectus forming part of the Registration
Statement; or (b) a Trust Agreement (the "Trust Agreement"), substantially in
the form filed as an exhibit to the Registration statement, to be entered into
among the Seller, Olympic First GP Inc., Olympic Second GP Inc., the
Security Insurer and the Owner Trustee for any such Trust, each as
specified in a prospectus supplement to the prospectus forming part of the
Registration Statement. The Notes may be issued from time to time by one or
more of the Trusts and secured pursuant to an Indenture (the "Indenture"),
substantially in the form filed as an exhibit to the Registration Statement,
to be entered into between the related Trust and the Indenture Trustee for
any such series specified in a prospectus supplement to the prospectus
forming part of the Registration Statement.
We have examined the resolutions of the Board of Directors of the
Seller adopted by written action dated December 12, 1996, the Registration
Statement
<PAGE>
Olympic Receivables Finance Corp.
December 17, 1996
Page 2
and such other documents, and have reviewed such questions of law, as we have
considered necessary and appropriate for the purposes of this opinion. Based
on the foregoing, we are of the opinion that:
1. Each Pooling and Servicing Agreement, Trust Agreement and
Indenture, when it has been duly authorized by the Seller and duly executed
and delivered by the Seller and the other respective parties thereto, will
constitute the valid and binding obligation of the Seller.
2. The Certificates, when duly executed and delivered in accordance
with the terms of the related Pooling and Servicing Agreement or Trust
Agreement, will be legally issued, fully paid and non-assessable, and the
holders of such Certificates will be entitled to the benefits of the related
Pooling and Servicing Agreement or the Trust Agreement, as the case may be.
3. The Notes, when duly executed and delivered in accordance with
the terms of the related Indenture, will be legally issued and will
constitute valid and binding obligations of the Trust, and the holders of
such Notes will be entitled to the benefits of the Indenture.
The opinions set forth above are subject to the following
qualifications and exceptions:
(a) Our opinions in paragraphs 1 and 3 above are subject to the
effect of any applicable bankruptcy, insolvency, reorganization, moratorium
or other similar law of general application affecting creditors' rights.
(b) Our opinions in paragraphs 1 and 3 above are subject to the
effect of general principles of equity, including (without limitation)
concepts of materiality, reasonableness, good faith and fair dealing, and
other similar doctrines affecting the enforceability of agreements
generally (regardless of whether considered in a proceeding in equity or at
law).
(c) Minnesota Statutes Section 290.371, Subd. 4, provides that any
corporation required to file a Notice of Business Activities Report does
not have a cause of action upon which it may bring suit under Minnesota law
unless the corporation has filed a Notice of Business Activities Report and
provides that the use of the courts of the State of Minnesota for all
contracts executed and all causes of action that arose before the end of
any period for
<PAGE>
Olympic Receivables Finance Corp.
December 17, 1996
Page 3
which a corporation failed to file a required report is precluded.
Insofar as our opinion may relate to the valid, binding and enforceable
character of any agreement under Minnesota law or in a Minnesota court, we
have assumed that any party seeking to enforce such an agreement has at all
times been, and will continue at all times to be, exempt from the
requirement of filing a Notice of Business Activities Report, or, if not
exempt, has duly filed, and will continue to duly file, all Notice of
Business Activities Reports.
Our opinions expressed above are limited to the laws of the States
of Minnesota and New York and the Delaware Business Trust Act.
We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement and to the reference to our firm under the heading
"Legal Matters" in the prospectus comprising part of the Registration Statement.
Dated: December 17, 1996
Very truly yours,
/s/ Dorsey & Whitney LLP
CFS
