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POOLING AND SERVICING AGREEMENT
between
AMERICREDIT CANADA 2002-A CORP.
as Seller
and
MERRILL LYNCH FINANCIAL ASSETS INC.
as Issuer
and
AMERICREDIT FINANCIAL SERVICES OF CANADA LTD.
as Servicer
and
BANK ONE, NA
as Backup Servicer
and
THE TRUST COMPANY OF BANK OF MONTREAL
as Custodian
Dated as of May 17, 2002
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TABLE OF CONTENTS
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ARTICLE 1 DEFINITIONS ........................................................... 1
1.1 Definitions ........................................................... 1
1.2 Other Definitional Provisions ......................................... 19
ARTICLE 2 CONVEYANCE OF PURCHASED ASSETS ........................................ 19
2.1 Conveyance of Purchased Assets ........................................ 19
2.2 Conveyance of Automobile Loans to Custodian and Creation of
Co-Ownership Interests ................................................ 20
2.3 Representations and Warranties of Issuer .............................. 21
ARTICLE 3 THE AUTOMOBILE LOANS .................................................. 23
3.1 Additional Representations and Warranties of Seller ................... 23
3.2 Repurchase upon Breach ................................................ 23
ARTICLE 4 CUSTODY OF AUTOMOBILE LOAN FILES ...................................... 24
4.1 Custody of Automobile Loan Files ...................................... 24
ARTICLE 5 ADMINISTRATION AND SERVICING OF AUTOMOBILE LOANS ...................... 24
5.1 Duties of the Servicer ................................................ 24
5.2 Collection of Automobile Loan Payments; Modifications of Automobile
Loans; Depository Agreements .......................................... 25
5.3 Realization upon Automobile Loans ..................................... 27
5.4 Insurance ............................................................. 28
5.5 Maintenance of Security Interests in Vehicles ......................... 30
5.6 Covenants, Representations, and Warranties of Servicer ................ 30
5.7 Purchase of Automobile Loans Upon Breach of Covenant .................. 31
5.8 Total Servicing Fee; Payment of Certain Expenses by Servicer .......... 31
5.9 Servicer's Certificate ................................................ 32
5.10 Annual Statement as to Compliance, Notice of Servicer Termination
Event ................................................................. 32
5.11 Annual Independent Accountants' Report ................................ 33
5.12 Access to Certain Documentation and Information Regarding
Automobile Loans ...................................................... 33
5.13 Monthly Tape .......................................................... 33
5.14 Fidelity Bond and Errors and Omissions Policy ......................... 34
ARTICLE 6 CUSTODIAL ACCOUNTS; DISTRIBUTIONS; STATEMENTS TO CERTIFICATEHOLDERS .. 34
6.1 Establishment of Custodial Accounts ................................... 34
6.2 Certain Reimbursements to the Servicer ................................ 36
6.3 Application of Collections ............................................ 36
6.4 Distribution Date Payments From the Collection Account ................ 36
6.5 Spread Account; Distribution Date Payments from Spread Account ........ 37
6.6 Certificate Rate and Certificate Balance Distributions ................ 38
6.7 Distributions Following an Event of Default ........................... 39
6.8 Statements to Certificateholders ...................................... 40
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ARTICLE 7 THE CERTIFICATES ................................................. 41
7.1 The Certificates .................................................. 41
7.2 Registration of Transfer and Exchange of Certificates ............. 43
7.3 Book-Entry Certificates ........................................... 44
7.4 Mutilated, Destroyed, Lost or Stolen Certificates ................. 45
7.5 Persons Deemed Owners ............................................. 45
7.6 Rights of Certificateholders ...................................... 46
7.7 Taxes ............................................................. 47
7.8 Place of Payments ................................................. 47
ARTICLE 8 THE SELLER ....................................................... 48
8.1 Representations of Seller ......................................... 48
8.2 Corporate Existence ............................................... 51
8.3 Liability of Seller; Indemnities .................................. 51
8.4 Merger or Consolidation of, or Assumption of the Obligations of,
Seller ............................................................ 52
8.5 Limitation on Liability of Seller and Others ...................... 53
8.6 Ownership of the Certificates ..................................... 53
ARTICLE 9 THE SERVICER ..................................................... 53
9.1 Representations of Servicer ....................................... 53
9.2 Liability of Servicer; Indemnities ................................ 55
9.3 Merger or Consolidation of, or Assumption of, the Obligations of
the Servicer or Backup Servicer ................................... 56
9.4 Limitation on Liability of Servicer, Backup Servicer and Others ... 57
9.5 Delegation of Duties .............................................. 58
9.6 Servicer and Backup Servicer Not to Resign ........................ 58
ARTICLE 10 SERVICER TERMINATION EVENT ...................................... 59
10.1 Servicer Termination Event ........................................ 59
10.2 Consequences of a Servicer Termination Event ...................... 60
10.3 Appointment of Successor .......................................... 61
10.4 Notification to Certificateholders ................................ 62
10.5 Waiver of Past Defaults ........................................... 62
ARTICLE 11 CONCERNING THE CUSTODIAN ........................................ 62
11.1 Duties of Custodian ............................................... 62
11.2 Certain Matters Affecting Custodian ............................... 63
11.3 Custodian Not Liable for Validity or Sufficiency of Certificates
or Automobile Loans ............................................... 64
11.4 Custodian May Own Certificates .................................... 65
11.5 Fees and Expenses of Custodian; Indemnification of Custodian ...... 65
11.6 Eligibility Requirements for Custodian ............................ 65
11.7 Resignation and Removal of Custodian .............................. 66
11.8 Successor Custodian ............................................... 67
11.9 Amalgamation or Consolidation of Custodian ........................ 68
11.10 Appointment of Co-Custodian, Separate Custodian or Sub-Custodian... 68
11.11 Appointment of Authenticating Agents .............................. 69
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11.12 Appointment of Paying Agent ....................................... 70
11.13 Representations, Warranties and Covenants of Custodian ............ 71
ARTICLE 12 TERMINATION ..................................................... 72
12.1 Termination ....................................................... 72
12.2 Optional Purchase of All Automobile Loans ......................... 72
ARTICLE 13 MISCELLANEOUS PROVISIONS ........................................ 73
13.1 Amendment ......................................................... 73
13.2 Protection of Title to Issuer ..................................... 74
13.3 Notices ........................................................... 76
13.4 Assignment ........................................................ 76
13.5 Limitations on Rights of Others ................................... 76
13.6 Severability ...................................................... 76
13.7 Separate Counterparts ............................................. 77
13.8 Headings .......................................................... 77
13.9 Governing Law ..................................................... 77
13.10 Nonpetition Covenants ............................................. 77
13.11 Limitation of Liability of Custodian .............................. 77
13.12 Independence of the Servicer ...................................... 78
13.13 No Joint Venture .................................................. 78
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POOLING AND SERVICING AGREEMENT dated as of May 17, 2002, between
AMERICREDIT CANADA 2002-A CORP., a corporation incorporated under the federal
laws of Canada, in its capacity as seller (the "Seller"), MERRILL LYNCH
FINANCIAL ASSETS INC., a corporation incorporated under the federal laws of
Canada (the "Issuer"), AMERICREDIT FINANCIAL SERVICES OF CANADA LTD., a
corporation incorporated under the laws of the Province of Ontario, in its
capacity as servicer (the "Servicer"), BANK ONE, NA, a national banking
association organized under the laws of the United States, in its capacity as
backup servicer (the "Backup Servicer"), and THE TRUST COMPANY OF BANK OF
MONTREAL, a trust company governed by the federal laws of Canada, in its
capacity as custodian (the "Custodian").
WHEREAS the Issuer desires to purchase a portfolio of receivables and
certain related assets arising in connection with motor vehicle retail
instalment sale contracts made by the Seller or acquired by the Seller through
motor vehicle dealers;
AND WHEREAS the Seller is willing to sell such receivables and related
assets to the Issuer;
AND WHEREAS the Servicer is willing to service such receivables and
related assets;
AND WHEREAS the Issuer is willing to transfer such receivables and related
assets to the Custodian, as agent, nominee and bailee for the benefit of the
Certificateholders (as defined herein) and to issue the Certificates (as defined
herein) to the Certificateholders;
NOW THEREFORE, in consideration of the premises and the mutual covenants
herein contained, the parties hereto agree as follows:
ARTICLE 1
DEFINITIONS
1.1 Definitions.
Whenever used in this Agreement, the following words and phrases shall
have the following meanings:
"ACAR Series 2002-A Certificateholders' Assets" means the Purchased
Assets, amounts held in the Depository Account with respect to the Automobile
Loans sold in connection with the ACAR Series 2002-A Certificateholders' Assets,
amounts on deposit in the Collection Account, amounts on deposit in the Spread
Account and amounts on deposit in the Accumulation Account, all funds and
Eligible Investments on deposit in or credited to such accounts (including all
Investment Earnings thereon), certain other rights under this Agreement and all
proceeds of the foregoing.
"Accelerated Certificate Balance Distributable Amount" means, for any
Distribution Date, an amount equal to the lesser of:
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(1) the amount on deposit in the Spread Account after giving effect to all
deposits to the Spread Account and withdrawals from the Spread Account as
described in items (i) through (v) in Section 6.5(a), in excess of the lesser of
(i) 2% of the Initial Pool Balance, and (ii) the Adjusted Certificate Balance;
and
(2) the excess, if any, of:
(a) the sum of:
(x) the Adjusted Certificate Balance for such Distribution Date;
minus
(y) the amounts deposited to the Accumulation Account in respect of the
Certificateholders' Certificate Balance Distributable Amount for the
current Distribution Date;
over
(b) the Required Adjusted Certificate Balance for such Distribution Date.
"Accountants' Report" has the meaning ascribed thereto in Section 5.11.
"Accounting Date" means, with respect to any Collection Period, the last
day of such Collection Period.
"Accumulation Account" means the account designated as such, established
and maintained pursuant to Section 6.1.
"Adjusted Certificate Balance" means, for the Class A, Class B and Class C
Certificates for any Distribution Date, prior to giving effect to amounts paid
on that date, the aggregate of the outstanding Certificate Balances for the
Classes on the Distribution Date less the Certificate Balance Accumulation
Amount on deposit in the Accumulation Account prior to giving effect to deposits
and withdrawals on such date.
"Affiliate" means, with respect to any specified Person, any other Person
controlling or controlled by or under common control with such specified Person.
For the purposes of this definition, "control" when used with respect to any
Person means the power to direct the management and policies of such Person,
directly or indirectly, whether through the ownership of voting securities, by
contract or otherwise; and the terms "controlling" and "controlled" have
meanings correlative to the foregoing.
"Aggregate Principal Balance" means, with respect to any Determination
Date, the sum of the Principal Balances for all Automobile Loans (other than (i)
any Automobile Loan that became a Liquidated Automobile Loan prior to the end of
the related Collection Period and (ii)
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any Automobile Loan that became a Purchased Automobile Loan prior to the end of
the related Collection Period) as of such Determination Date.
"Agreement" means this Pooling and Servicing Agreement, as amended,
modified, supplemented or restated from time to time.
"AmeriCredit Assignment" means the assignment dated as of the Closing Date
from AmeriCredit Canada to the Seller.
"AmeriCredit Canada" means AmeriCredit Financial Services of Canada Ltd.,
and its successors and permitted assigns hereunder.
"AmeriCredit US Custodial Agreement" means the custodial agreement dated
as of the Closing Date between the Documentary Custodian and the Custodian, as
amended, modified, supplemented or restated from time to time.
"Amount Financed" means, with respect to an Automobile Loan, the aggregate
amount advanced under such Automobile Loan toward the purchase price of the
Financed Vehicle and any related costs, including amounts advanced at the time
the Automobile Loan is originated in respect of accessories, insurance premiums,
service, car club and warranty contracts and other items customarily financed as
part of retail automobile instalment sale contracts or promissory notes, and
related costs.
"Annual Percentage Rate" or "APR" of an Automobile Loan means the annual
percentage rate of finance charges or service charges, as stated in such
Automobile Loan.
"Authenticating Agent" means the Person appointed and acting as such
pursuant to Section 11.11.
"Automobile Loan" means any motor vehicle retail instalment sale contract
listed on the Schedule of Automobile Loans.
"Automobile Loan Files" means the documents specified in Section 4.1(b).
"Available Funds" means, on each Distribution Date, the sum of (i) the
Collected Funds for the preceding Collection Period, plus (ii) all Purchase
Amounts deposited in the Collection Account during the preceding Collection
Period, plus (iii) all proceeds of payments made by the Interest Rate Cap
Counterparty under the Interest Rate Cap (other than any Early Termination
Payments) or by the Interest Rate Cap Guarantor under the Interest Rate Cap
Guarantee (other than in respect of any Early Termination Payments) on or before
such Distribution Date, plus (iv) all Investment Earnings for such Distribution
Date.
"Backup Servicer" means Bank One, NA, in its capacity as backup servicer
hereunder and its successors in such capacity.
"Basic Documents" means this Agreement, the AmeriCredit Assignment, the
Seller Assignment, the Interest Rate Cap, the AmeriCredit US Custodial
Agreement, the Purchase Agreement and other documents and certificates delivered
in connection therewith.
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"Book-Entry Certificates" means a beneficial interest in the
fully-registered book-entry only certificates representing each of the Class
A-1, Class A-2, Class A-3, Class B and Class C Certificates, ownership and
transfers of which shall be made through book entries by a Clearing Agency as
described in Section 7.3.
"Business Day" means a day other than a Saturday, a Sunday or other day on
which commercial banks located in Toronto, Ontario or Fort Worth, Texas are not
open for business.
"CDOR" means, for any Class A-1 Interest Period, the annual rate of
interest that is equal to the average rate (rounded, if necessary, to the
nearest 1/100,000 of one percent) for 90 day Canadian dollar banker's
acceptances that appears on the Reuters screen CDOR Page as of 10:00 a.m.,
Toronto time, on the second Business Day immediately preceding the first day of
such Class A-1 Interest Period.
"Certificate" means any of the certificates of the Issuer designated as
AmeriCredit Canada Automobile Receivables Co-Ownership Certificates, Series
2002-A as executed by the Certificate Registrar and authenticated and delivered
hereunder by the Authenticating Agent.
"Certificate Balance" means, for any Class of Offered Certificates at any
time, initially, the Initial Certificate Balance for such Class and, thereafter,
equals the Initial Certificate Balance of such Class reduced by all amounts
allocable to the Certificate Balance of such Class previously distributed to the
holders of such Class.
"Certificate Balance Accumulation Amount" means for any Distribution Date,
the sum of (i) the aggregate of the Certificateholders' Certificate Balance
Distributable Amounts, (ii) the aggregate of the Accelerated Certificate Balance
Distributable Amounts and (iii) any Maturity Advances, in each case, on deposit
in the Accumulation Account on that date (after giving effect to all deposits
to, but prior to any distributions from, the Accumulation Account on that date).
"Certificate Balance Distributable Amount" means, with respect to any
Distribution Date, the amount equal to the sum of:
(a) collections received on Automobile Loans (other than Liquidated
Automobile Loans and Purchased Automobile Loans) that are
allocable to principal, including any full and partial
principal prepayments, during the related Collection Period;
plus
(b) the Principal Balance of all Automobile Loans (other than
Purchased Automobile Loans) that became Liquidated Automobile
Loans during the related Collection Period;
plus
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(c) the portion of the Purchase Amount allocable to principal of
all Purchased Automobile Loans that became Purchased Automobile
Loans during the related Collection Period;
plus
(d) the aggregate amount of Cram Down Losses that shall have
occurred during the related Collection Period.
"Certificate Majority" means the holders of 66 2/3% or more of the
Certificate Balance of the outstanding Offered Certificates or, where a Class of
Offered Certificates is affected by a matter separately, 66 2/3% or more of the
Certificate Balance of the outstanding Offered Certificates of the affected
Class.
"Certificate Owner" means initially the Issuer and thereafter, with respect
to a Book-Entry Certificate, the Person who is the owner of such Book-Entry
Certificate, as reflected on the books of the Clearing Agency, or on the books
of a Person maintaining an account with such Clearing Agency (directly or as an
indirect participant, in accordance with the rules of such Clearing Agency) and
shall mean, with respect to a Definitive Certificate, the Certificateholder.
"Certificate Rate" means, with respect to (i) the Class A-1 Certificates
and each Class A-1 Interest Period, a rate per annum equal to CDOR for such
Class A-1 Interest Period plus 0.17%, (ii) the Class A-2 Certificates, 4.697%,
(iii) the Class A-3 Certificates, 5.422%, (iv) the Class B Certificates, 7.070%
and (v) the Class C Certificates, 8.344%.
"Certificate Register" has the meaning set forth in Section 7.2(a).
"Certificate Registrar" means the Custodian acting as Certificate Registrar
pursuant to this Agreement.
"Certificateholder" means the Person in whose name a Certificate is
registered in the Certificate Register. All references herein to
"Certificateholders" shall reflect the rights of Certificate Owners as they may
indirectly exercise such rights through the Clearing Agency and the Clearing
Agency Participants, except as otherwise specified herein; provided, however,
that the parties hereto shall be required to recognize as a "Certificateholder"
only the Person in whose name a Certificate is registered in the Certificate
Register.
"Certificateholders' Certificate Balance Carryover Amount" means, as of any
Distribution Date, the excess of an amount equal to the Certificateholders'
Certificate Balance Distributable Amount for the preceding Distribution Date
over the Certificate Balance Accumulation Amount with respect to clause (i) of
such definition that were actually deposited in the Accumulation Account in
respect of the Certificate Balances of the Offered Certificates on such
preceding Distribution Date.
"Certificateholders' Certificate Balance Distributable Amount" means, for
any Distribution Date, other than the Final Scheduled Distribution Date for any
Class of Offered Certificates, the sum of the Certificateholders' Monthly
Certificate Balance Distributable Amount and the Certificateholders' Certificate
Balance Carryover Amount, if any. The
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Certificateholders' Certificate Balance Distributable Amount on the
Final Scheduled Distribution Date for any Class of Certificate will equal the
sum of:
(1) the Certificateholders' Monthly Certificate Balance
Distributable Amount for such Distribution Date;
plus
(2) the Certificateholders' Certificate Balance Carryover Amount as
of such Distribution Date;
plus
(3) the excess of the Adjusted Certificate Balance of the maturing
Class of Certificates, if any, over the amounts described in
clauses (1) and (2) above.
Notwithstanding the above, the Certificateholders' Certificate Balance
Distributable Amount shall not exceed the Adjusted Certificate Balance.
"Certificateholders' Certificate Rate Carryover Amount" means, with respect
to any Distribution Date and any Class of Offered Certificates, the sum of (a)
the difference between (i) the Certificateholders' Monthly Certificate Rate
Distributable Amount, and (ii) the amount that was actually deposited to the
Accumulation Account in respect of the Certificateholders' Certificate Rate
Distributable Amount for the Class on such preceding Distribution Date, plus (b)
the Certificateholders' Certificate Rate Carryover Amount, if any, as of the
prior Distribution Date, plus (c) an amount equal to interest on the
Certificateholders' Certificate Rate Carryover Amount for such Class of Offered
Certificates on the previous Offered Certificate Distribution Date, at the
Certificate Rate for such Class from and including the immediately preceding
Distribution Date to but excluding the current Distribution Date.
"Certificateholders' Certificate Rate Distributable Amount" means, with
respect to any Distribution Date and Class of Offered Certificates, the lesser
of (a) the sum of (i) the Certificateholders' Monthly Certificate Rate
Distributable Amount, and (ii) the Certificateholders' Certificate Rate
Carryover Amount, if any, and (b) the amount that is available to be deposited
to the Accumulation Account in respect of the Certificateholders' Certificate
Rate Distributable Amount.
"Certificateholders' Distributable Amount" means, for any Distribution
Date, the sum of the Certificateholders' Certificate Balance Distributable
Amount and the Certificateholders' Certificate Rate Distributable Amount.
"Certificateholders' Monthly Certificate Balance Distributable Amount"
means, for any Distribution Date, the lesser of:
(1) the excess of;
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(a) the Adjusted Certificate Balance less any Certificateholder's
Certificate Balance Carryover Amount before giving effect to
distributions on such date, over
(b) the Required Adjusted Certificate Balance; and
(2) the Certificate Balance Distributable Amount.
"Certificateholders' Monthly Certificate Rate Distributable Amount" means,
with respect to any Distribution Date and any Class of Offered Certificates, an
amount equal to the product of (i) the Certificate Balance of such Class as of
the close of the immediately preceding Distribution Date, (ii) the Certificate
Rate for such class, and (iii) (x) in the case of the Class A-1 Certificates, a
fraction, the numerator of which is the actual number of days from and including
the immediately preceding Distribution Date to but excluding the current
Distribution Date, and the denominator of which is 365, and (y) in the case of
the Class A-2, Class A-3, Class B and Class C Certificates, a fraction, the
numerator of which is one and the denominator of which is 12; provided, however,
that for the initial Distribution Date, the Certificateholders' Monthly
Certificate Rate Distributable Amount for the Class A-1, Class A-2, Class A-3,
Class B and Class C Certificates will be an amount equal to $68,227.40,
$202,696.40, $159,892.71, $94,788.22 and $89,495.10, respectively.
"Certificateholders' Parity Deficit Amount" means, for any Distribution
Date, the excess, if any, of:
(1) the remaining Adjusted Certificate Balance on the Distribution Date,
after giving effect to all deposits made to and including such
Distribution Date into the Accumulation Account from sources other
than the Spread Account;
minus
(2) the Pool Balance at the end of the prior calendar month.
"Certificateholders' Targeted Certificate Rate Distributable Amount" means,
with respect to any Class of Offered Certificates and any related Offered
Certificate Distribution Date, an amount equal to the sum of (a) the product of
(i) the sum of (A) the Certificate Balance of such Class as of the close of the
immediately preceding Offered Certificate Distribution Date for such Class, and
(B) the Certificateholders' Certificate Rate Carryover Amount from the prior
Offered Certificate Distribution Date, (ii) the Certificate Rate for such Class,
and (iii) (x) in the case of the Class A-1 Certificates a fraction, the
numerator of which is the actual number of days from and including the
immediately preceding Offered Certificate Distribution Date to but excluding the
current Offered Certificate Distribution Date, and the denominator of which is
365, and (y) in the case of the Class A-2, Class A-3, Class B and Class C
Certificates a fraction, the numerator of which is the number of Distribution
Dates from and including the immediately preceding Offered Certificate
Distribution Date to and excluding the current Offered Certificate Distribution
Date and the denominator of which is 12, and (b) the Certificateholders'
Certificate Rate Carryover Amount from the prior Offered Certificate
Distribution Date; provided, however, that for the initial Offered Certificate
Distribution Dates for the Class A-1, Class A-2, Class A-3, Class B and Class C
Certificates, the Certificateholders' Targeted Certificate Rate Distributable
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Amount will be an amount equal to $276,320.96, $1,783,041.19, $1,135,238.21,
$672,996.39 and $635,415.21, respectively.
"Class" means, collectively, all of the Certificates bearing the same
alphabetical and, if applicable, numeral class designation.
"Class A Certificates" means, collectively, the Class A-1 Certificates, the
Class A-2 Certificates and the Class A-3 Certificates.
"Class A-1 Certificate" means any one of the Certificates with a "Class
A-1" designation on the face thereof, substantially in the form of Exhibit A-1
attached hereto.
"Class A-1 Interest Period" means, in respect of any Class A-1 Certificate,
the period from and including one Offered Certificate Distribution Date relating
to such Offered Certificate (or in the case of the first Class A-1 Interest
Period, the Closing Date) to but excluding the next following Offered
Certificate Distribution Date relating to the Offered Certificate.
"Class A-2 Certificate" means any one of the Certificates with a "Class
A-2" designation on the face thereof, substantially in the form of Exhibit A-2
attached hereto.
"Class A-3 Certificate" means any one of the Certificates with a "Class
A-3" designation on the face thereof, substantially in the form of Exhibit A-3
attached hereto.
"Class B Certificate" means any one of the Certificates with a "Class B"
designation on the face thereof, substantially in the form of Exhibit A-4
attached hereto.
"Class C Certificate" means any one of the Certificates with a "Class C"
designation on the face thereof, substantially in the form of Exhibit A-5
attached hereto.
"Clearing Agency" shall mean an organization recognized as a "clearing
agency" pursuant to the Securities Act (Ontario).
"Clearing Agency Participant" shall mean a broker, dealer, bank, other
financial institution or other Person for whom from time to time a Clearing
Agency effects book-entry transfers and pledges of securities deposited with the
Clearing Agency.
"Closing Date" means May 17, 2002, or such other date as the Issuer, the
Seller and the Underwriter agree, but not later than May 31, 2002.
"Collateral Insurance" has the meaning set forth in Section 5.4(a).
"Collected Funds" means, with respect to any Collection Period, the amount
of funds in the Collection Account representing collections on the Automobile
Loans during such Collection Period, including all Net Liquidation Proceeds
collected during such Collection Period (but excluding any Purchase Amounts).
"Collection Account" means the account designated as such, established and
maintained pursuant to Section 6.1.
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"Collection Period" means, with respect to the first Distribution Date, the
period beginning on the close of business on the Cut-off Date and ending on the
close of business on May 31, 2002. With respect to each subsequent Distribution
Date, "Collection Period" means the immediately preceding calendar month. Any
amount stated "as of the close of business of the last day of a Collection
Period" shall give effect to the following calculations as determined as of the
end of the day on such last day: (i) all applications of collections and (ii)
all distributions.
"Collection Records" means all manually prepared or computer generated
records relating to collection efforts or payment histories with respect to the
Automobile Loans.
"Computer Tape" means the computer tapes or other electronic media
furnished by the Seller to the Issuer and its assigns describing certain
characteristics of the Automobile Loans as of the Cut-off Date.
"Contract" means a motor vehicle retail instalment sale contract.
"Corporate Trust Office" means, with respect to the Custodian, the
principal corporate trust office of the Custodian, which at the time of
execution of this agreement is Suite 5104, 100 King Street West, Toronto,
Ontario, M5X 1A1, Attention: Senior Trust Officer.
"Cram Down Loss" means, with respect to any Automobile Loan, if a court of
appropriate jurisdiction in a proceeding related to an Insolvency Event shall
have issued an order reducing the amount owed on the Automobile Loan or
otherwise modifying or restructuring the Scheduled Automobile Loan Payments to
be made on the Automobile Loan, an amount equal to:
(i) the excess of the principal balance of such Automobile Loan
immediately prior to such order over the Automobile Loan's Principal
Balance as so reduced; and/or
(ii) if such court shall have issued an order reducing the effective rate
of interest on such Automobile Loan, the excess of the principal
balance of such Automobile Loan immediately prior to such order over
the net present value (using as the discount rate the higher of the
average payment rate on such Automobile Loan or the rate of
interest, if any, specified by the court in such order) of the
Scheduled Automobile Loan Payments as so modified or restructured. A
"Cram Down Loss" shall be deemed to have occurred on the date of
issuance of such order.
"Custodial Accounts" has the meaning set forth in Section 6.1(b).
"Custodian" means The Trust Company of Bank of Montreal, its successor in
interest and permitted assigns, or any successor custodian appointed as herein
provided.
"Custodian Fee" means the fee payable to the Custodian for services
rendered by the Custodian in the exercise and performance of any of the powers
and duties of the Custodian hereunder.
"Custodian Liability" has the meaning set forth in Section 11.5(b).
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"Cut-off Date" means May 8, 2002.
"DBRS" means Dominion Bond Rating Service Limited, or its successors.
"Dealer" means a dealer who sold a Financed Vehicle and who originated and
assigned the respective Automobile Loan to AmeriCredit Canada under a Dealer
Agreement or pursuant to a Dealer Assignment.
"Dealer Agreement" means any agreement between a Dealer and AmeriCredit
Canada relating to the acquisition of Automobile Loans from a Dealer by
AmeriCredit Canada.
"Dealer Assignment" means, with respect to an Automobile Loan, the executed
assignment executed by a Dealer conveying such Automobile Loans to AmeriCredit
Canada.
"Deficiency Draw Amount" means, the amount, after taking into account the
application on the Distribution Date of Available Funds for the related
Collection Period, equal to the sum, without duplication, of:
(1) any shortfall on the Distribution Date in the full payment of
amounts in clauses (i) and (ii) of Section 6.4(a);
plus
(2) if the Distribution Date is an Offered Certificate Distribution
Date, the Certificateholders' Certificate Rate Carryover Amount for
such date;
plus
(3) the greater of:
(A) the Certificateholders' Parity Deficit Amount, if any, for the
Distribution Date;
and
(B) if the Distribution Date is the Final Scheduled Distribution Date
for any Class, any remaining outstanding Certificate Balance of that
Class, to the extent that the amount is available on the
Distribution Date in the Spread Account.
"Definitive Certificates" means the fully registered certificated form
certificates issued to owners of Book-Entry Certificates or their nominees in
certain circumstances.
"Depository Account" means an account maintained by the Servicer at the
Depository Bank pursuant to Section 5.2(d).
"Depository Agreement" means any agreement relating to the Depository
Account.
"Depository Bank" means a depository institution at which a Depository
Account is maintained by the Servicer.
<PAGE>
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"Determination Date" means, with respect to any Collection Period, the
Business Day preceding the Distribution Date in the next calendar month.
"Distribution Date" means the sixth day of each month commencing June
6, 2002. If any such day is not a Business Day in Toronto, Ontario, the
"Distribution Date" shall be the next such Business Day.
"Documentary Custodian" means AmeriCredit Financial Services, Inc., in
its capacity as documentary custodian under the AmeriCredit US Custodial
Agreement, and its successors in such capacity thereunder.
"Early Termination Payment" means any early termination payment payable
by the Interest Rate Cap Counterparty pursuant to the Interest Rate Cap if the
Interest Rate Cap is terminated prior to the Final Scheduled Distribution Date
for the Class A-1 Certificates.
"Electronic Ledger" means the electronic master record of the retail
instalment sales contracts or instalment loans of the Servicer.
"Eligible Deposit Account" means either (a) a segregated account with
an Eligible Institution or (b) a segregated trust account with a corporate trust
department of a bank or trust company organized under the laws of Canada or any
one of the provinces thereof, having corporate trust powers and acting as agent
for funds deposited in such account, so long as any of the securities of such
bank or trust company have a credit rating from each Rating Agency in one of its
generic rating categories which signifies investment grade.
"Eligible Institution" means the Custodian, or any other trust company
or Schedule I chartered bank incorporated under the laws of Canada (including an
affiliate of the Custodian) or any province thereof (i) which has either (A) a
long-term unsecured debt rating of AA (low) or better by DBRS, Aa3 or better by
Moody's and AA- or better from Standard & Poor's or (B) a certificate of deposit
rating or short-term credit rating of R-1 (middle) or better by DBRS, Prime-1 or
better by Moody's and A-1+ by Standard & Poor's, or such other lower ratings as
may be acceptable to the Rating Agencies, and (ii) whose deposits are insured by
Canada Deposit Insurance Corporation or its successors;
"Eligible Investments" mean book-entry securities, negotiable
instruments or securities represented by instruments in bearer or registered
form which evidence:
(a) direct obligations of, and obligations fully guaranteed as to
timely payment by, the Government of Canada or any agency or
instrumentality thereof the obligations of which are backed by
the full faith and credit of the Government of Canada;
(b) demand deposits, time deposits or certificates of deposit of any
chartered bank or trust company or credit union or co-operative
credit society incorporated under the laws of Canada or any
province thereof and subject to supervision and examination by
federal banking or depository institution authorities; provided,
however, that at the time of the investment or contractual
commitment to invest therein, the commercial paper or other
short-term senior unsecured debt
<PAGE>
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obligations (other than such obligations the rating of which is
based on the credit of a Person other than such depository
institution or trust company) of such depository institution or
trust company shall have a credit rating of at least two of the
following: (i) A-1+ from Standard & Poor's, (ii) Prime-1 from
Moody's, and (iii) R-1 (high) from DBRS; provided, further,
however, that if such commercial paper or other short-term senior
unsecured debt obligations are rated by Moody's they shall have a
credit rating of at least Prime-1 from Moody's.
(c) call loans and notes or banker's acceptances issued or accepted
by any bank, trust company, credit union or co-operative credit
society described in paragraph (b) above;
(d) commercial paper having, at the time of the investment or
contractual commitment to invest therein, a rating of at least
two of the following: (i) A-1+ from Standard & Poor's; (ii)
Prime-1 from Moody's, and (iii) R-1 (high) from DBRS; provided,
however, that if such commercial paper is rated by Moody's it
shall be rated at least Prime-1 by Moody';s;
(e) investments in money market funds (including funds for which the
Custodian in each of their individual capacities or any of their
respective Affiliates is investment manager, controlling party or
advisor) having a rating of at least two of the following: (i)
AAAm or AAAm-G from Standard & Poor's, (ii) Aaa from Moody's, and
(iii) AAA from DBRS; provided, however, that if such investments
are rated by Moody's they shall be rated at least Aaa by Moody's;
(f) repurchase obligations with respect to any security that is a
direct obligation of, or fully guaranteed by, the Government of
Canada or any agency or instrumentality thereof the obligations
of which are backed by the full faith and credit of the
Government of Canada, in either case entered into with a bank or
trust company (acting as principal) referred to in clause (b)
above; and
(g) any other investment to which the Rating Agencies have consented.
"Event of Default" means the occurrence of either of the following
events: (i) the failure to make any Certificate Rate distribution on any Class
of Offered Certificates when the same is scheduled to be made and the
continuance of such failure for a period of five days, or (ii) the failure to
distribute the outstanding Certificate Balance of any Class of Offered
Certificates on its Final Scheduled Distribution Date.
"Final Scheduled Distribution Date" means (i) for the Class A-1
Certificates, July 7, 2003, (ii) for the Class A-2 Certificates, September 6,
2005, (iii) for the Class A-3 Certificates, October 6, 2006, (iv) for the Class
B Certificates, March 6, 2007, and (v) for the Class C Certificates, May 6,
2009.
"Financed Vehicle" means an automobile, light-duty truck, van or
minivan, together with all accessions thereto, securing an Obligor's
indebtedness under the respective Automobile Loan.
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"Financing Statements" has the meaning set forth in Section 13.2(a).
"Force-Placed Insurance" has the meaning set forth in Section 5.4.
"Independent Accountants" has the meaning set forth in Section 5.11.
"Initial Certificate Balance" means, for the Class A-1 Certificates,
$45,000,000, for the Class A-2 Certificates, $80,750,000, for the Class A-3
Certificates, $53,966,000, for the Class B Certificates, $24,535,000, and for
the Class C Certificates, $19,628,000.
"Initial Pool Balance" means the Pool Balance as of the Cut-off Date.
"Insolvency Event" means, with respect to a specified Person, (a) the
admission by the Person that the Person is unable to pay its liabilities
generally as they become due, or (b) the making by the Person of a general
assignment for the benefit of the creditors of the Person, or (c) any other
acknowledgement by the Person of the insolvency of the Person, or (d)(i) the
institution of any proceeding by or against the Person seeking to adjudicate it
a bankrupt or insolvent or seeking liquidation, winding up, dissolution,
reorganization, arrangement, adjustment, protection, relief or composition of
its debts under any law relating to bankruptcy, insolvency, reorganization,
moratorium or relief of debtors or seeking the entry of an order for relief by
the receiver, trustee or other similar official for the Person or for any
substantial part of its property and if such proceeding has been instituted
against the Person either such proceeding has not been stayed or dismissed
within 45 days or any of the actions sought in such proceeding (including the
entry of an order for relief or the appointment of a receiver), are granted
against the Person or the property of the Person or any substantial part
thereof, or (ii) the private appointment of a receiver in respect of the Person
or of the property of the Person or any substantial part thereof.
"Insurance Add-On Amount" means the premium charged to the Obligor in
the event that the Servicer obtains Force-Placed Insurance pursuant to Section
5.4.
"Interest Rate Cap" means the Confirmation (as defined in the ISDA
Master Agreement) dated as of the Closing Date between the Interest Rate Cap
Counterparty and AmeriCredit Canada relating to an interest rate cap
transaction, as amended, modified, supplemented or restated from time to time.
"Interest Rate Cap Counterparty" means Merrill Lynch Capital Services,
Inc., and its successors and permitted assigns under the ISDA Master Agreement.
"Interest Rate Cap Guarantee" means the guarantee dated as of May 6,
2002 by Interest Rate Cap Guarantor in favour of AmeriCredit Canada in respect
of the obligations of the Interest Rate Cap Counterparty under the ISDA Master
Agreement, as amended, modified, supplemented or restated from time to time.
"Insurance Policies" has the meaning set forth in Section 5.4(a).
"Interest Rate Cap Guarantor" means Merrill Lynch & Co., Inc., and its
successors.
<PAGE>
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"Investment Earnings" means, with respect to any date and any Custodial
Account, the interest and other investment earnings (net of losses and
investment expenses) on amounts on deposit in such Custodial Account and to be
deposited into the Collection Account on such date.
"ISDA Master Agreement" means the ISDA Master Agreement dated as of May
3, 2002 (including the Schedule thereto) between the Interest Rate Cap
Counterparty and AmeriCredit Canada, as amended, modified, supplemented or
restated from time to time.
"Issuer" means Merrill Lynch Financial Assets Inc., and its successors.
"Lien" means a security interest, lien, charge, pledge, equity, or
encumbrance of any kind, other than tax liens, mechanics' liens and any liens
that attach to the respective Automobile Loan by operation of law as a result of
any act or omission by the related Obligor.
"Liquidated Automobile Loan" means, with respect to any Collection
Period, an Automobile Loan for which, as of the last day of such Collection
Period (i) 90 days have elapsed since the Servicer repossessed the Financed
Vehicle; provided, however, that in no case shall $30 or more of a Scheduled
Automobile Loan Payment have become 210 or more days delinquent in the case of a
repossessed Financed Vehicle; (ii) the Servicer has determined in good faith
that it has received all amounts it expects to recover; or (iii) $30 or more of
a Scheduled Automobile Loan Payment has become 120 or more days delinquent,
except in the case of a repossessed Financed Vehicle.
"Maturity Advance" means any advance made by the Servicer pursuant to
Section 6.3(d).
"Monthly Records" means all records and data maintained by the Servicer
with respect to the Automobile Loans, including the following with respect to
each Automobile Loans: the account number; the originating Dealer; Obligor name;
Obligor address; Obligor home phone number; Obligor business phone number;
original Principal Balance; original term; Annual Percentage Rate; current
Principal Balance; current remaining term; origination date; first payment date;
final scheduled payment date; next payment due date; date of most recent
payment; new/used classification; collateral description; days currently
delinquent; number of contract extensions (months) to date; amount of Scheduled
Automobile Loan Payment; current Insurance Policy expiration date; and past due
late charges.
"Moody's" means Moody's Investors Service Inc., or its successor.
"Net Liquidation Proceeds" means, with respect to a Liquidated
Automobile Loan, (1) proceeds from the underlying Financed Vehicles'
disposition; plus (2) any insurance proceeds; plus (3) other monies received
from the Obligor that are allocable to principal and interest due under the
Automobile Loan; minus (4) the Servicer's reasonable out-of-pocket costs,
including repossession and resale expenses not already deducted from any
proceeds of disposition or collections, in connection with the collection of
such Automobile Loan and any amounts that are required to be remitted to the
Obligor by law; provided, however, that Net Liquidation Proceeds shall in no
event be less than zero.
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"Obligor" means, in respect of an Automobile Loan, the purchaser or
co-purchasers of the related Financed Vehicle and any other Person who owes
payments under the Automobile Loan.
"Offered Certificate Distribution Date" means (i) the Distribution Date
in each of August, November, February and May of each year in the case of the
Class A-1 Certificates, (ii) the Distribution Date in November and May of each
year in the case of the Class A-2 Certificates, (iii) the Distribution Dates in
October and April of each year in the case of the Class A-3, Class B and Class C
Certificates and (iv) with respect to any Class of Offered Certificates, the
date on which the Certificate Balance is reduced to zero pursuant to exercise of
the "optional purchase" of the Servicer under Error! Reference source not found.
and the payments made from the Accumulation Account after the Pool Balance has
been reduced to zero. If the Certificate Balance for any Class of Offered
Certificates is not distributed in full on its Targeted Certificate Balance
Distribution Date or an Event of Default occurs, the Offered Certificate
Distribution Date for such Class shall be each Distribution Date thereafter
until the Certificate Balance for such class is reduced to zero. The first
Offered Certificate Distribution Date shall be (i) August 6, 2002 in the case of
the Class A-1 Certificates, (ii) November 6, 2002 in the case of the Class A-2
Certificates and (iii) October 6, 2002 in the case of the Class A-3, Class B and
Class C Certificates.
"Offered Certificates" means the Class A-1, Class A-2, Class A-3, Class
B and Class C Certificates.
"Officers' Certificate" means a certificate signed by the chairman of
the board, the president, any executive vice president or any vice president,
any treasurer, assistant treasurer, secretary or assistant secretary of the
Seller or the Servicer, as appropriate.
"Opinion of Counsel" means a written opinion of counsel, which is in
form and substance acceptable to the Custodian and the Rating Agencies, each
acting reasonably.
"Optional Purchase Price" has the meaning set forth in Section 12.2(a).
"Ownership Interest" means, as to any Certificate, any ownership
interest in such Certificate as the Certificateholder thereof and any other
interest therein, whether direct or indirect, legal or beneficial, as owner or
as pledgee.
"Percentage Interest" means, with respect to any Certificate, a
percentage, the numerator of which is the initial balance of such Certificate as
of the Closing Date, as specified on the face thereof, and the denominator of
which is the Initial Certificate Balance of the relevant Class.
"Person" means any individual, corporation, estate, partnership, joint
venture, association, joint stock company, trust (including any beneficiary
thereof), unincorporated organization or government or any agency or political
subdivision thereof.
"Pool Balance" means, as of any date the aggregate Principal Balance of
the Automobile Loans, excluding all Liquidated Automobile Loans and all
Purchased Automobile Loans, at the end of the preceding calendar month.
<PAGE>
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"PPSA" means, in respect of each province or territory of Canada (other
than Quebec), the Personal Property Security Act, as from time to time in effect
in such province or territory and, in respect of Quebec, the Civil Code of
Quebec, as from time to time in effect in such province.
"Principal Balance" means, with respect to any Automobile Loan, as of
any date, the sum of (x) the Amount Financed, minus (i) that portion of all
amounts received on or prior to such date and allocable to principal in
accordance with the terms of the Automobile Loan, minus (ii) any Cram Down Loss
in respect of such Automobile Loan accounted for as at that date, plus (y) the
unpaid interest that has been capitalized on such Automobile Loan and added to
the loan balance as at that date.
"Purchase Agreement" means the purchase agreement dated as of the
Closing Date between AmeriCredit Canada and the Seller, as amended, modified,
supplemented or restated from time to time.
"Purchase Amount" means, with respect to a Purchased Automobile Loan,
the Principal Balance as of the date of purchase.
"Purchased Assets" has the meaning set forth in Section 2.1.
"Purchased Automobile Loan" means an Automobile Loan purchased as of
the close of business on the last day of a Collection Period by the Servicer
pursuant to Section 5.7 or Section 12.2 or repurchased by AmeriCredit Canada
pursuant to Section 3.2.
"Rating Agency" means each of Moody's, Standard & Poor's and DBRS and,
collectively, the "Rating Agencies". If no such organization or successor
maintains a rating on the Certificates, "Rating Agency" shall be a nationally
recognized statistical rating organization or other comparable Person designated
by the Servicer and acceptable to the Custodian, acting reasonably, notice of
which designation shall be given to the Custodian.
"Rating Agency Condition" means, with respect to any action, that each
Rating Agency shall have been given 10 days' (or such shorter period as shall be
acceptable to each Rating Agency) prior notice thereof and that each of the
Rating Agencies shall have notified the Seller, the Issuer, the Servicer and the
Custodian in writing that such action will not result in a reduction or
withdrawal of the then current rating of any Class of Certificates.
"Record Date" means, with respect to each Distribution Date, the close
of business on the Business Day immediately preceding such Distribution Date.
"Required Adjusted Certificate Balance" means, for any Distribution
Date, the amount equal to the sum of:
(a) the product of:
(1) the Pool Balance as of the end of the prior calendar month, and
(2) 100% minus the Required Overcollateralization Percentage;
<PAGE>
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plus
(b) if such Distribution Date is on or prior to the date on which the
"optional repurchase" can be exercised by the Servicer, the
Spread Account balance on such Distribution Date (prior to giving
effect to any deposits thereto or withdrawals therefrom).
Notwithstanding anything to the contrary in this defined term, the
Required Adjusted Certificate Balance shall never be greater than the Pool
Balance at any time.
"Required Overcollateralization Percentage" means a percentage equal to
(i) 19% of the outstanding Pool Balance less (ii) the Spread Account balance,
divided by the Pool Balance. On any Distribution Date on which the Adjusted
Certificate Balance, as of the prior Distribution Date, is less than or equal to
10% of the initial Adjusted Certificate Balance, the Required
Overcollateralization Percentage equals 100%.
"Residual Certificate" means a Certificate designated as a "Class R"
Certificate on the face thereof, substantially in the form of Exhibit A-6
attached hereto, and evidencing the residual interests in the ACAR Series 2002-A
Certificateholders' Assets.
"Responsible Officer" means, with respect to any Person, the chairman
or vice-chairman of the board of directors, any managing director, the chairman
or vice-chairman of the executive committee of the board of directors, the chief
executive officer, the president, any vice president, assistant vice president,
the secretary, any assistant secretary, the treasurer, any assistant treasurer,
or any other officer of such person customarily performing functions similar to
those performed by any of the above designated officers and also means, with
respect to a particular corporate trust matter, any other officer to whom such
matter is referred because of such officer's knowledge of and familiarity with
the particular subject.
"Schedule of Automobile Loans" means the schedule (which schedule may
be in the form of microfiche or a disk) of all motor vehicle retail instalment
sales contracts originally sold by the Seller to the Issuer on the Closing Date
to be held as part of the ACAR 2002-A Certificateholder's Assets pursuant to
this Agreement, which is attached as Schedule A.
"Schedule of Representations" means the Schedule of Representations and
Warranties attached hereto as Schedule B.
"Scheduled Automobile Loan Payment" means, with respect to any
Collection Period for any Automobile Loan, the amount set forth in such
Automobile Loan as required to be paid by the Obligor in such Collection Period.
If after the Closing Date, the Obligor's obligation under an Automobile Loan
with respect to a Collection Period has been modified so as to differ from the
amount specified in such Automobile Loan as a result of (i) the order of a court
in an insolvency proceeding involving the Obligor, or (ii) modifications or
extensions of the Automobile Loan permitted by Section 5.2(b), the Scheduled
Automobile Loan Payment with respect to such Collection Period shall refer to
the Obligor's payment obligation with respect to such Collection Period as so
modified.
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"Seller" means AmeriCredit Canada 2002-A Corp., a corporation
incorporated under the federal laws of Canada, and its successors in interest to
the extent permitted hereunder.
"Seller Assignment" means the assignment dated as of the Closing Date
from the Seller to the Issuer.
"Service Contract" means, with respect to a Financed Vehicle, the
agreement, if any, financed under the related Automobile Loan that provides for
the repair of such Financed Vehicle.
"Servicer" means AmeriCredit Canada, as the servicer of the Automobile
Loans, and each successor Servicer pursuant to Section 10.3.
"Servicer Termination Event" means an event specified in Section 10.1.
"Servicer's Certificate" means an Officers' Certificate of the Servicer
delivered pursuant to Section 5.9, substantially
in the form of Exhibit B.
"Servicing Fee" has the meaning set forth in Section 5.8.
"Servicing Fee Rate" means 2.25% per annum.
"Simple Interest Method" means the method of allocating a fixed level
payment on an obligation between principal and interest, pursuant to which the
portion of such payment that is allocated to interest is equal to the product of
the fixed rate of interest on such obligation multiplied by the period of time
(expressed as a fraction of a year, based on the actual number of days in the
calendar month and 365 days in the calendar year) elapsed since the preceding
payment under the obligation was made.
"Spread Account" means the account designated as such, established and
maintained pursuant to Section 6.1.
"Standard & Poor's" means Standard & Poor's Rating Service, a division
of The McGraw-Hill Companies, Inc., or its successor.
"Statistical Calculation Date" means April 28, 2002.
"Subordinated Certificate" means a Class B, Class C or Residual
Certificate.
"Targeted Certificate Balance Distribution Date" means, for the Class
A-1 Certificates, November 6, 2002, for the Class A-2 Certificates, May 6, 2004,
for the Class A-3 Certificates, October 6, 2005, for the Class B Certificates,
October 6, 2005, and for the Class C Certificates, October 6, 2005.
"Voting Rights" means the voting rights for the Certificates.
"Underwriter" means Merrill Lynch Canada Inc. and its successors.
<PAGE>
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1.2 Other Definitional Provisions.
(a) All terms defined in this Agreement shall have the defined meanings
when used in any instrument governed hereby and in any certificate or other
document made or delivered pursuant hereto unless otherwise defined therein.
(b) The definitions contained in this Agreement are applicable to the
singular as well as the plural forms of such terms and to the masculine as well
as to the feminine and neuter genders of such terms.
(c) Any agreement, instrument or statute defined or referred to herein
or in any instrument or certificate delivered in connection herewith means such
agreement, instrument or statute as from time to time amended, modified or
supplemented and includes (in the case of agreements or instruments) references
to all attachments thereto and instruments incorporated therein; references to a
Person are also to its permitted successors and assigns.
(d) The words "hereof," "herein," "hereunder" and words of similar
import when used in this Agreement shall refer to this Agreement as a whole and
not to any particular provision of this Agreement; Section, Schedule and Exhibit
references contained in this Agreement are references to Sections, Schedules and
Exhibits in or to this Agreement unless otherwise specified; and the term
"including" shall mean "including without limitation."
(e) Except as otherwise specifically provided herein, all monetary
amounts in this Agreement are stated in lawful money of Canada.
ARTICLE 2
CONVEYANCE OF PURCHASED ASSETS
2.1 Conveyance of Purchased Assets.
In consideration of the Issuer's delivery to or upon the order of the
Seller on the Closing Date of (i) $223,879,000 (less the amount deposited by the
Issuer to Spread Account pursuant to Section 6.1(a)(iii)), and (ii) the Residual
Certificate, the Seller does hereby sell, transfer, assign, set over and
otherwise convey to the Issuer, without recourse (subject to the obligations set
forth herein) (and on a fully serviced basis as provided herein and in the
Purchase Agreement), all right, title and interest of the Seller in and to the
following assets (collectively, the "Purchased Assets"):
(a) the Automobile Loans and all collections received thereon after
the Cut-off Date;
(b) the security interests in the Financed Vehicles granted by
Obligors pursuant to the Automobile Loans and any other interest
of the Seller in such Financed Vehicles;
(c) any proceeds and the right to receive proceeds with respect to
the Automobile Loans from claims on any physical damage, credit
life or disability insurance policies covering Financed Vehicles
or Obligors and any proceeds from the liquidation of the
Automobile Loans;
<PAGE>
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(d) any proceeds from any Automobile Loan repurchased by a Dealer
pursuant to a Dealer Agreement as a result of a breach of
representation or warranty in the related Dealer Agreement;
(e) the Automobile Loan Files;
(f) all proceeds of payments made by the Interest Rate Cap
Counterparty pursuant to the Interest Rate Cap (other than any
Early Termination Payments);
(g) all proceeds of payments made by the Interest Rate Cap Guarantor
pursuant to the Interest Rate Cap Guarantee (except to the extent
such proceeds relate to Early Termination Payments);
(h) all of the right, title and interest of the Seller in and to the
Purchase Agreement (including, without limitation, all of the
Seller's rights against AmeriCredit Canada under the Purchase
Agreement in respect of breaches of representations and
warranties made by AmeriCredit Canada under the Purchase
Agreement); and
(i) the proceeds of any and all of the foregoing.
It is the intention of the Seller that the transfer and assignment
contemplated by this Agreement shall constitute a sale of the Purchased Assets
from the Seller to the Issuer and the beneficial interest in and title to the
Purchased Assets shall not be part of the Seller's estate in the event of the
filing of a bankruptcy or insolvency petition or proceeding by or against the
Seller under any bankruptcy or insolvency law.
2.2 Conveyance of Automobile Loans to Custodian and Creation of
Co-Ownership Interests.
(a) Forthwith upon the closing of the sale by the Seller to the
Issuer pursuant to Section 2.1 on the Closing Date, the Issuer,
on the direction of each Person who has agreed to acquire a
Certificate, hereby sells, assigns, transfers, sets over, conveys
and delivers to, and deposits with, the Custodian, all of the
right, title and interest of the Issuer in, to and under the
Purchased Assets. The Custodian shall thereafter hold the ACAR
Series 2002-A Certificateholders' Assets as agent, nominee and
bailee, and so far as same is required for the purposes of the
laws of the Province of Quebec, as holder of power of attorney
(fonde de pouvoir) within the meaning of Article 2692 of the
Civil Code of Quebec, for the benefit of the Certificateholders,
all of whom appoint the Custodian to so act.
(b) The Custodian agrees to act as the agent, nominee and bailee for
the Certificateholders pursuant to the terms of this Agreement,
and to perform the functions and services and exercise the
authority conferred on it by the Certificateholders pursuant to
this Agreement. Subject to the terms and conditions hereof, the
Custodian hereby acknowledges its acceptance of, as agent,
nominee and bailee, and holder of power of attorney (fonde de
pouvoir), for and on behalf of the Certificateholders, the sale,
assignment, transfer, conveyance,
<PAGE>
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delivery and deposit of all of the Issuer's present and future
right, title and interest in, to and under the Purchased Assets.
2.3 Representations and Warranties of Issuer.
The Issuer hereby represents and warrants to the Custodian, for its own
benefit and the benefit of the Certificateholders, and to the Backup Servicer,
as of the Closing Date (which representations and warranties shall not merge on,
but shall survive, the Closing Date), that:
(a) The Issuer is a corporation duly organized, validly existing and
in good standing under the laws of Canada and possesses all
licenses and authorizations necessary to carry out the
transactions of the Issuer contemplated by this Agreement.
(b) The execution and delivery of this Agreement by the Issuer, and
the performance and compliance with the terms of this Agreement
by the Issuer, does not and will not violate the Issuer's
articles of incorporation or by-laws or constitute a default (or
an event which, with notice or lapse of time, or both, would
constitute a default) under, or result in the breach of, any
material agreement or other instrument to which it is a party or
which is applicable to it or any of its assets, the default or
breach of which, in the Issuer's good faith and reasonable
judgment, is likely to affect materially and adversely either the
ability of the Issuer to perform its obligations under this
Agreement or the financial condition of the Issuer.
(c) No consent, approval or authorization of or designation,
declaration, notice or filing with any governmental authority,
corporation, person or firm on the part of the Issuer is required
in connection with the valid execution and delivery of this
Agreement or the consummation of any other transactions of the
Issuer contemplated hereby other than a consent, approval,
authorization, designation, declaration, notice or filing which
has been obtained, made or given.
(d) The Issuer has the full power and authority to carry on its
business as now being conducted and to enter into and consummate
all transactions of the Issuer contemplated by this Agreement,
has duly authorized the execution, delivery and performance of
this Agreement, and has duly executed and delivered this
Agreement.
(e) This Agreement, assuming due authorization, execution and
delivery by each of the other parties hereto, constitutes a
valid, legal and binding obligation of the Issuer, enforceable
against the Issuer in accordance with the terms hereof, subject
to (A) applicable bankruptcy, insolvency, reorganization,
moratorium and other laws affecting the enforcement of creditors'
rights generally, and (B) general principles of equity,
regardless of whether such enforcement is considered in a
proceeding in equity or at law.
(f) The Issuer is not in violation of, and its execution and delivery
of this Agreement and its performance and compliance with the
terms of this Agreement does not constitute a violation of, any
law, any order or decree of any court or arbiter, or any order,
regulation or demand of any federal, provincial or local
governmental
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or regulatory authority, which violation, in the Issuer's good faith
and reasonable judgment, is likely to affect materially and adversely
either the ability of the Issuer to perform its obligations under this
Agreement or the financial condition of the Issuer.
(g) The creation of the co-ownership interests in the Purchased Assets in
favour of the Certificateholders as contemplated herein requires no
regulatory approval, other than any such approvals as have been
obtained, and is not subject to any bulk sales or similar legislation
in effect in any applicable jurisdiction.
(h) No litigation is pending or, to the best of the Issuer's knowledge,
threatened against the Issuer that, if determined adversely to the
Issuer, would prohibit the Issuer from entering into this Agreement
or, in the Issuer's good faith and reasonable judgment, is likely to
materially and adversely affect either the ability of the Issuer to
perform its obligations under this Agreement or the financial
condition of the Issuer.
(i) Immediately prior to the transfer of the Purchased Assets by the
Issuer to the Custodian and the creation of the co-ownership interests
in the Purchased Assets in favour of the Certificateholders pursuant
to this Agreement, the Issuer is the sole beneficial owner of the
Purchased Assets free and clear of all encumbrances and has full right
and authority to sell, assign and transfer its right, title and
interest in the Purchased Assets.
(j) The Issuer is transferring its right, title and interest in, to and
under the Purchased Assets to the Custodian for the benefit of the
Certificateholders free and clear of any liens, pledges, charges and
security interests created by it or attributable to its ownership.
(k) The Issuer will in its financial statements treat (i) the transfer to
it of the Seller's interest in the Purchased Assets as a sale of the
Purchased Assets to the Issuer, and (ii) the transfer by the Issuer to
the Certificateholders as co-owners of the beneficial interest in the
Purchased Assets as a sale of the Purchased Assets to the
Certificateholders. The consideration received by the Issuer upon such
sale will constitute the fair market value of the Purchased Assets.
The Issuer will be solvent at all relevant times prior to, and will
not be rendered insolvent by, the sale of the Purchased Assets to the
Certificateholders. The Issuer is not selling the Purchased Assets to
the Certificateholders with any intent to hinder, delay or defraud any
of the creditors of the Issuer.
The representations and warranties of the Issuer set forth in this Section
2.3 shall survive the execution and delivery of this Agreement and shall inure
to the benefit of the Persons for whose benefit they were made for so long as
the ACAR Series 2002-A Certificateholders' Assets remain in existence. Upon
discovery by any party hereto of any breach of any of the foregoing
representations and warranties, the party discovering such breach shall give
prompt written notice to the other parties and to the Rating Agencies.
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ARTICLE 3
THE AUTOMOBILE LOANS
3.1 Additional Representations and Warranties of Seller.
The Seller hereby represents and warrants that each of the representations
and warranties set forth on the Schedule of Representations attached hereto as
Schedule B on which the Issuer is deemed to have relied in acquiring the
Purchased Assets is true and correct. Such representations and warranties speak
as of the execution and delivery of this Agreement and as of the Closing Date in
the case of the Purchased Assets, but shall survive the sale, transfer and
assignment of the Purchased Assets by the Seller to the Issuer and by the Issuer
to the Custodian pursuant to this Agreement.
3.2 Repurchase upon Breach.
(a) The Seller, the Servicer or the Custodian, as the case may be, shall
inform the other parties to this Agreement promptly, by notice in writing, upon
the discovery of any breach of the Seller's representations and warranties made
pursuant to Section 3.1. As of the last day of the second (or, if the Seller so
elects, the first) month following the discovery by the Seller or receipt by the
Seller of notice of such breach, unless such breach is cured by such date,
AmeriCredit Canada shall have an obligation to repurchase any Automobile Loan in
which the interests of the Certificateholders are materially and adversely
affected by any such breach as of such date. The "second month" shall mean the
month following the month in which discovery occurs or notice is given, and the
"first month" shall mean the month in which discovery occurs or notice is given.
In consideration of and simultaneously with the repurchase of the Automobile
Loan, (i) the Seller shall remit, or cause AmeriCredit Canada to remit, to the
Collection Account the Purchase Amount, in the manner specified in Section
6.3(b); provided, however, that the obligation of the Seller to repurchase any
Automobile Loan arising solely as a result of a breach of AmeriCredit Canada's
representations and warranties pursuant to the Purchase Agreement is subject to
the receipt by the Seller of the Purchase Amount from AmeriCredit Canada, and
(ii) the Issuer shall execute such assignments and other documents reasonably
requested by such person in order to effect such repurchase. The sole remedy of
the Issuer, the Custodian, or the Certificateholders with respect to a breach of
representations and warranties pursuant to Section 3.1 and the agreement
contained in this Section shall be to require AmeriCredit Canada to repurchase
Automobile Loans pursuant to this Section, subject to the conditions contained
herein, and to enforce AmeriCredit Canada's obligation to the Seller to
repurchase such Automobile Loans pursuant to the Purchase Agreement. The
Custodian shall not have a duty to conduct any affirmative investigation as to
the occurrence of any conditions requiring the repurchase of any Automobile Loan
pursuant to this Section.
In addition to the foregoing and notwithstanding whether the related
Automobile Loan shall have been purchased by AmeriCredit Canada, AmeriCredit
Canada shall indemnify the Servicer, the Backup Servicer, the Custodian and the
officers, directors, agents and employees thereof and the Certificateholders
against all costs, expenses, losses, damages, claims and liabilities, including
reasonable fees and expenses of counsel, which may be asserted against or
incurred by any of them as a result of third party claims arising out of the
events or facts giving rise to such breach.
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ARTICLE 4
CUSTODY OF AUTOMOBILE LOAN FILES
4.1 Custody of Automobile Loan Files.
(a) On the Closing Date, the Custodian shall enter into the AmeriCredit US
Custodial Agreement.
(b) The Documentary Custodian (in accordance with the terms of the
AmeriCredit US Custodial Agreement) shall act as custodian on behalf of the
Custodian of the following documents or instruments pertaining to each
Automobile Loan:
(i) The fully executed original of the Automobile Loan (together
with any agreements modifying the Automobile Loan, including,
without limitation, any extension agreements); and
(ii) The original credit application, or a copy thereof, of each
Obligor, fully executed by each such Obligor on customary
form, or on a form approved by the Seller, for such
application.
ARTICLE 5
ADMINISTRATION AND SERVICING OF AUTOMOBILE LOANS
5.1 Duties of the Servicer.
(a) The Servicer is hereby authorized to act as agent for the Custodian
and the Certificateholders and in such capacity shall manage, service,
administer and make collections on the Automobile Loans, and perform the other
actions required by the Servicer under this Agreement. The Servicer agrees that
its servicing of the Automobile Loans shall be carried out in accordance with
customary and usual procedures of institutions which service motor vehicle
retail instalment sales contracts and, to the extent more exacting, the degree
of skill and attention that the Servicer exercises from time to time with
respect to all comparable motor vehicle receivables that it services for itself
or others. In performing such duties, so long as AmeriCredit Canada is the
Servicer, it shall substantially comply with the policies and procedures
described on Schedule C, as such policies and procedures may be updated from
time to time. The Servicer's duties shall include, without limitation,
collection and posting of all payments, responding to inquiries of Obligors
regarding the Automobile Loans, investigating delinquencies, sending payment
coupons to Obligors, reporting any required tax information to Obligors, paying
the disposition costs of default accounts, monitoring the collateral, complying
with the terms of the Depository Agreement, accounting for collections and
furnishing monthly and annual statements to the Issuer with respect to
distributions, monitoring the status of Insurance Policies with respect to the
Financed Vehicles and performing the other duties specified herein.
(b) The Servicer shall also administer and enforce all rights and
responsibilities of the holder of the Automobile Loans provided for in the
Dealer Agreements (and shall maintain possession of the Dealer Agreements to the
extent it is necessary to do so), the Dealer Assignments and the Insurance
Policies, to the extent that such Dealer Agreements, Dealer
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Assignments and Insurance Policies relate to the Automobile Loans, the Financed
Vehicles or the Obligors. To the extent consistent with the standards, policies
and procedures otherwise required hereby, the Servicer shall follow its
customary standards, policies, and procedures and shall have full power and
authority, acting alone, to do any and all things in connection with such
managing, servicing, administration and collection that it may deem necessary or
desirable. Without limiting the generality of the foregoing, the Servicer is
hereby authorized and empowered by the Custodian to execute and deliver, on
behalf of the Custodian and the Certificateholders, any and all instruments of
satisfaction or cancellation, or of partial or full release or discharge, and
all other comparable instruments, with respect to the Automobile Loans and with
respect to the Financed Vehicles; provided, however, that notwithstanding the
foregoing, the Servicer shall not, except pursuant to an order from a court of
competent jurisdiction, release an Obligor from payment of any unpaid amount
under any Automobile Loan or waive the right to collect the unpaid balance of
any Automobile Loan from the Obligor except in accordance with the Servicer's
customary practices.
(c) The Servicer is hereby authorized to commence, in its own name or in
the name of the Custodian, a legal proceeding to enforce an Automobile Loan
pursuant to Section 5.3 or to commence or participate in any other legal
proceeding (including, without limitation, a bankruptcy proceeding) relating to
or involving an Automobile Loan, an Obligor or a Financed Vehicle. If the
Servicer commences or participates in such a legal proceeding in its own name,
the Custodian shall thereupon be deemed to have automatically assigned such
Automobile Loan to the Servicer solely for purposes of commencing or
participating in any such proceeding as a party or claimant, and the Servicer is
authorized and empowered by the Custodian to execute and deliver in the
Servicer's name any notices, demands, claims, complaints, responses, affidavits
or other documents or instruments in connection with any such proceeding. The
Custodian shall furnish the Servicer with any limited powers of attorney and
other documents which the Servicer may reasonably request and which the Servicer
deems necessary or appropriate and take any other steps which the Servicer may
deem necessary or appropriate to enable the Servicer to carry out its servicing
and administrative duties under this Agreement.
5.2 Collection of Automobile Loan Payments; Modifications of Automobile Loans;
Depository Agreements.
(a) Consistent with the standards, policies and procedures required by
this Agreement, the Servicer shall make reasonable efforts to collect all
payments called for under the terms and provisions of the Automobile Loans as
and when the same shall become due, and shall follow such collection procedures
as it follows with respect to all comparable automobile loans that it services
for itself or others and otherwise act with respect to the Purchased Assets, the
Dealer Agreements, the Dealer Assignments and the Insurance Policies in such
manner as will, in the reasonable judgment of the Servicer, maximize the amount
to be received by the Custodian with respect thereto. The Servicer is authorized
in its discretion to waive any prepayment charge, late payment charge or any
other similar fees that may be collected in the ordinary course of servicing any
Automobile Loan.
(b) The Servicer may at any time agree to a modification or amendment of
an Automobile Loan in order to (i) change the Obligor's regular due date to a
date within the Collection Period in which such due date occurs or (ii)
re-amortize the Scheduled Automobile
<PAGE>
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Loan Payments on the Automobile Loan following a partial prepayment of
principal, in accordance with its customary procedures if the Servicer believes
in good faith that such extension, modification or amendment is necessary to
avoid a default on such Automobile Loan, will maximize the amount to be received
by the Issuer with respect to such Automobile Loan, and is otherwise in the best
interests of the Issuer.
(c) The Servicer may grant payment extensions on, or other modifications
or amendments to, an Automobile Loan (in addition to those modifications
permitted by Section 5.2(b)) in accordance with its customary procedures if the
Servicer believes in good faith that such extension, modification or amendment
is necessary to avoid a default on such Automobile Loan, will maximize the
amount to be received by the Custodian on behalf of the Certificateholders with
respect to such Automobile Loan, and is otherwise in the best interests of the
Certificateholders; provided, however, that:
(i) The aggregate period of all extensions on an Automobile Loan
shall not exceed eight months;
(ii) In no event may an Automobile Loan be extended beyond the
Collection Period immediately preceding the latest Final
Scheduled Distribution Date; and
(iii) the Servicer shall not amend or modify an Automobile Loan
(except as provided in Section 5.2(b) and this Section
5.2(c)) without the consent of a Certificate Majority.
(d) The Servicer shall maintain the following system for collecting and
processing payments on the Automobile Loans and the other motor vehicle retail
instalment sale contracts or security agreements owned or serviced by the
Servicer or AmeriCredit Canada. The Servicer shall establish and maintain one or
more segregated deposit accounts (collectively, the "Depository Account") at the
Depository Bank. The Depository Account shall be maintained by the Servicer for
and on behalf of AmeriCredit Canada, the Custodian and each other owner of motor
vehicle retail instalment sale contracts or security agreements originated and
owned or serviced by the Servicer or AmeriCredit Canada. The Servicer shall use
its best efforts to notify or direct Obligors to make all cheque or other mail
payments on the Automobile Loans directly to the Depository Account and all
direct debit payments on the Automobile Loans to the Depository Account. The
Servicer shall not permit any payments other than payments on the Automobile
Loans and other motor vehicle retail instalment sale contracts or security
agreements originated and owned or serviced by the Servicer or AmeriCredit
Canada to be made to the Depository Account. The Servicer shall use its best
efforts to notify or direct the Depository Bank to deposit all payments on the
Automobile Loans in the Depository Account no later than the Business Day after
receipt, and to cause all amounts credited to the Depository Account on account
of such payments to be transferred to the Depository Account no later than the
second Business Day after receipt of such payments. The Servicer shall cause all
amounts credited to the Depository Account on account of payments on the
Automobile Loans to be transferred to the Collection Account no later than the
second Business Day after receipt of such payments in the Depository Account.
The Depository Account shall be a demand deposit account held by the Depository
Bank, and shall be an Eligible Deposit Account. The Servicer may at any time
move
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the Depository Account to another Eligible Deposit Account provided the Servicer
shall give the Custodian and the Backup Servicer written notice of such new
Depository Account.
Prior to the Closing Date, the Servicer shall have notified each Obligor
that makes its payments on the Automobile Loans by cheque and to make such
payments thereafter directly to the Depository Bank (except in the case of
Obligors that have already been making such payments to the Depository Bank),
and shall have provided each such Obligor with remittance invoices in order to
enable such Obligors to make such payments directly to the Depository Bank for
deposit into the Depository Account, and the Seller will continue, not less
often than every three months, to so notify those Obligors who have failed to
make payments to the Depository Bank. The Servicer shall request each Obligor
that makes payment on the Automobile Loans by direct debit of such Obligor's
bank account, to execute a new authorization for automatic payment sufficient to
authorize direct debit by the Depository Bank. If at any time, the Depository
Bank is unable to directly debit an Obligor's bank account that makes payment on
the Automobile Loans by direct debit and if such inability is not cured within
15 days or cannot be cured by execution by the Obligor of a new authorization
for automatic payment, the Servicer shall notify such Obligor that it cannot
make payment by direct debit and must thereafter make payment by cheque.
In the event of a termination of the Servicer, the successor Servicer shall
establish a new Depository Account or similar collection processing system in
accordance with and subject to the terms hereof. The outgoing Servicer shall,
upon request of the Custodian, but at the expense of the outgoing Servicer,
deliver to the successor Servicer all documents and records relating to each
such Depository Account and an accounting of amounts collected and held by the
Depository Bank and otherwise use its best efforts to effect the orderly and
efficient transfer of any Depository Account to the successor Servicer.
(e) The Servicer shall deposit all payments by or on behalf of the
Obligors received directly by the Servicer to the Depository Bank without
deposit into any intervening account and as soon as practicable, but in no event
later than three Business Days after receipt thereof.
5.3 Realization upon Automobile Loans.
(a) Consistent with the standards, policies and procedures required by
this Agreement, the Servicer shall use its best efforts to repossess (or
otherwise comparably convert the ownership of) and liquidate any Financed
Vehicle securing an Automobile Loan with respect to which the Servicer has
determined that payments thereunder are not likely to be resumed, as soon as is
practicable after default on such Automobile Loan but in no event later than the
date on which all or any portion of a Scheduled Automobile Loan Payment has
become 91 days delinquent; provided, however, that the Servicer may elect not to
repossess a Financed Vehicle within such time period if in its good faith
judgment it determines that the proceeds ultimately recoverable with respect to
such Automobile Loan would be increased by forbearance. The Servicer is
authorized to follow such customary practices and procedures as it shall deem
necessary or advisable, consistent with the standard of care required by Section
5.1, which practices and procedures may include reasonable efforts to realize
upon any recourse to Dealers, the sale of the related Financed Vehicle at a
public or private sale, the submission of claims under an insurance policy and
other actions by the Servicer in order to realize upon such an
<PAGE>
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Automobile Loan. The foregoing is subject to the provision that, in any case in
which the Financed Vehicle shall have suffered damage, the Servicer shall not
expend funds in connection with any repair or towards the repossession of such
Financed Vehicle unless it shall determine in its discretion that such repair
and/or repossession shall increase the proceeds of liquidation of the related
Automobile Loan by an amount greater than the amount of such expenses. All
amounts received upon liquidation of a Financed Vehicle shall be remitted
directly by the Servicer to the Collection Account without deposit into any
intervening account as soon as practicable, but in no event later than the
Business Day after receipt thereof. The Servicer shall be entitled to recover
all reasonable expenses incurred by it in the course of repossessing and
liquidating a Financed Vehicle into cash proceeds, but only out of the cash
proceeds of such Financed Vehicle, any deficiency obtained from the Obligor or
any amounts received from the related Dealer, which amounts in reimbursement may
be retained by the Servicer (and shall not be required to be deposited as
provided in Section 5.2(e)) to the extent of such expenses. The Servicer shall
collect and remit on behalf of the Custodian and the Certificateholders any
sales, goods and services and other applicable taxes payable in connection with
any realization in respect of any repossessed Financed Vehicles.
(b) If the Servicer elects to commence a legal proceeding to enforce a
Dealer Agreement or Dealer Assignment the act of commencement shall be deemed to
be an automatic assignment from the Custodian and the Certificateholders to the
Servicer of the rights under such Dealer Agreement or Dealer Assignment for
purposes of collection only. If, however, in any enforcement suit or legal
proceeding it is held that the Servicer may not enforce a Dealer Agreement or
Dealer Assignment on the grounds that it is not a real party in interest or a
Person entitled to enforce the Dealer Agreement or Dealer Assignment, the Issuer
or the Custodian, at the Servicer's expense, or the Seller, at the Seller's
expense, shall take such steps as the Servicer deems reasonably necessary to
enforce the Dealer Agreement or Dealer Assignment, including bringing suit in
its name or the name of the Seller or of the Issuer and/or the Custodian for the
benefit of the Certificateholders. All amounts recovered shall be remitted
directly by the Servicer as provided in Section 5.2(e).
5.4 Insurance.
(a) The Servicer shall require, in accordance with its customary servicing
policies and procedures, that each Financed Vehicle be insured by the related
Obligor under the insurance policies (the "Insurance Policies") referred to in
Paragraph 24 of the Schedule of Representations and Warranties and shall monitor
the status of such physical loss and damage insurance coverage thereafter, in
accordance with its customary servicing procedures. Each Automobile Loan
requires the Obligor to maintain such physical loss and damage insurance, naming
AmeriCredit Canada and its successors and assigns as additional insureds, and
permits the holder of such Automobile Loan to obtain physical loss and damage
insurance at the expense of the Obligor if the Obligor fails to maintain such
insurance. If the Servicer shall determine that an Obligor has failed to obtain
or maintain a physical loss and damage Insurance Policy covering the related
Financed Vehicle which satisfies the conditions set forth in clause (i)(a) of
such Paragraph 24 (including, without limitation, during the repossession of
such Financed Vehicle) the Servicer may enforce the rights of the holder of the
Automobile Loan under the Automobile Loan to require the Obligor to obtain such
physical loss and damage insurance in accordance with its customary servicing
policies and procedures. The Servicer may maintain a vendor's single
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interest or other collateral protection Insurance Policy with respect to all
Financed Vehicles ("Collateral Insurance") which policy shall by its terms
insure against physical loss and damage in the event any Obligor fails to
maintain physical loss and damage insurance with respect to the related Financed
Vehicle. All policies of Collateral Insurance shall be endorsed with clauses
providing for loss payable to the Servicer. Costs incurred by the Servicer in
maintaining such Collateral Insurance shall be paid by the Servicer.
(b) The Servicer may, if an Obligor fails to obtain or maintain a physical
loss and damage Insurance Policy, obtain insurance with respect to the related
Financed Vehicle and advance on behalf of such Obligor, as required under the
terms of the Insurance Policy, the premiums for such insurance (such insurance
being referred to herein as "Force-Placed Insurance"). All policies of
Force-Placed Insurance shall be endorsed with clauses providing for loss payable
to the Servicer. Any cost incurred by the Servicer in maintaining such
Force-Placed Insurance shall only be recoverable out of premiums paid by the
Obligors or Net Liquidation Proceeds with respect to the Automobile Loan, as
provided in Section 5.4(c).
(c) In connection with any Force-Placed Insurance obtained hereunder, the
Servicer may, in the manner and to the extent permitted by applicable law,
require the Obligors to repay the entire premium to the Servicer. In no event
shall the Servicer include the amount of the premium in the Amount Financed
under the Automobile Loan. For all purposes of this Agreement, the Insurance
Add-On Amount with respect to any Automobile Loan having Force-Placed Insurance
will be treated as a separate obligation of the Obligor and will not be added to
the Principal Balance of such Automobile Loan, and amounts allocable thereto
will not be available for distribution on the Certificates. The Servicer shall
retain and separately administer the right to receive payments from Obligors
with respect to Insurance Add-On Amounts or rebates of Forced-Placed Insurance
premiums. If an Obligor makes a payment with respect to an Automobile Loan
having Force-Placed Insurance, but the Servicer is unable to determine whether
the payment is allocable to the Automobile Loan or to the Insurance Add-On
Amount, the payment shall be applied first to any unpaid Scheduled Automobile
Loan Payments and then to the Insurance Add-On Amount. Net Liquidation Proceeds
on any Automobile Loan will be used first to pay the Principal Balance and
accrued interest on such Automobile Loan and then to pay the related Insurance
Add-On Amount. If an Obligor under an Automobile Loan with respect to which the
Servicer has placed Force-Placed Insurance fails to make scheduled payments of
such Insurance Add-On Amount as due, and the Servicer has determined that
eventual payment of the Insurance Add-On Amount is unlikely, the Servicer may,
but shall not be required to, purchase such Automobile Loan from the Issuer for
the Purchase Amount on any subsequent Determination Date. Any such Automobile
Loan, and any Automobile Loan with respect to which the Servicer has placed
Force-Placed Insurance which has been paid in full (excluding any Insurance
Add-On Amounts) will be assigned to the Servicer.
(d) The Servicer may sue to enforce or collect upon the Insurance
Policies, in its own name, if possible, or as agent of the Custodian. If the
Servicer elects to commence a legal proceeding to enforce an Insurance Policy,
the act of commencement shall be deemed to be an automatic assignment of the
rights of the Custodian and the Certificateholders under such Insurance Policy
to the Servicer for purposes of collection only. If, however, in any enforcement
suit or legal proceeding it is held that the Servicer may not enforce an
Insurance Policy on the grounds that it is not a real party in interest or a
holder entitled to enforce the Insurance Policy,
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the Custodian, at the Servicer's expense, shall take such steps as the Servicer
deems necessary to enforce such Insurance Policy, including bringing suit in its
name or the name of the Custodian for the benefit of the Certificateholders.
(e) The Servicer will cause itself and may cause the Custodian to be named
as named insured under all policies of Collateral Insurance.
5.5 Maintenance of Security Interests in Vehicles.
Consistent with the policies and procedures required by this Agreement, the
Servicer shall take such steps on behalf of the Custodian as are necessary to
maintain perfection of the security interest created by each Automobile Loan in
the related Financed Vehicle, including, but not limited to, obtaining the
execution by the Obligors and the recording, registering, filing, re-recording,
re-filing, and re-registering of all security agreements, financing statements
and financing change statements as are necessary to maintain the security
interest granted by the Obligors under the respective Automobile Loans. The
Custodian hereby authorizes the Servicer, and the Servicer agrees, to take any
and all steps necessary to re-perfect such security interest on behalf of the
Custodian as necessary because of the relocation of a Financed Vehicle or for
any other reason.
5.6 Covenants, Representations, and Warranties of Servicer.
By its execution and delivery of this Agreement, the Servicer makes the
following representations, warranties and covenants on which the Custodian
relies in accepting the Purchased Assets, and on which the Authenticating Agent
relies in authenticating the Certificates.
(a) The Servicer covenants as follows:
(i) Liens in Force. The Financed Vehicle securing each Automobile
Loan shall not be released in whole or in part from the security
interest granted by the Automobile Loan, except upon payment in
full of the Automobile Loan or as otherwise contemplated herein;
(ii) No Impairment. The Servicer shall do nothing to impair the
rights of the Custodian or the Certificateholders in the
Purchased Assets, the Dealer Agreements, the Dealer Assignments
or the Insurance Policies except as otherwise expressly provided
herein;
(iii) No Amendments. The Servicer shall not extend or otherwise amend
the terms of any Automobile Loan, except in accordance with
Section 5.2; and
(iv) Restrictions on Liens. The Servicer shall not (i) create, incur
or suffer to exist, or agree to create, incur or suffer to
exist, or consent to cause or permit in the future (upon the
happening of a contingency or otherwise) the creation,
incurrence or existence of any Lien or restriction on
transferability of the Automobile Loans, and the restrictions on
transferability imposed by this Agreement or (ii) sign or file
under the
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PPSA of any jurisdiction any financing statement which names
AmeriCredit Canada as a debtor, or sign any security
agreement authorizing any secured party thereunder to file
such financing statement, with respect to the Automobile
Loans.
(b) The Servicer represents, warrants and covenants as of the Closing Date
as to itself that the representations and warranties set forth on the
Schedule of Representations attached hereto as Schedule B are true and
correct, provided that such representations and warranties contained
therein and herein shall not apply to any entity other than
AmeriCredit Canada.
5.7 Purchase of Automobile Loans Upon Breach of Covenant.
Upon discovery by any of the Servicer or a Responsible Officer of the
Custodian of a breach of any of the covenants set forth in Sections 5.5 or
5.6(a), the party discovering such breach shall give prompt written notice to
the others; provided, however, that the failure to give any such notice shall
not affect any obligation of the Servicer under this Section. As of the second
Accounting Date following its discovery or receipt of notice of any breach of
any covenant set forth in Sections 5.5 or 5.6(a) which materially and adversely
affects the interests of the Certificateholders in any Automobile Loan
(including any Liquidated Automobile Loan) (or, at the Servicer's election, the
first Accounting Date so following) or the related Financed Vehicle, the
Servicer shall, unless such breach shall have been cured in all material
respects, purchase from the Custodian the Automobile Loan affected by such
breach and, on such Accounting Date, the Servicer shall pay the related Purchase
Amount. It is understood and agreed that the obligation of the Servicer to
purchase any Automobile Loan (including any Liquidated Automobile Loan) with
respect to which such a breach has occurred and is continuing shall, if such
obligation is fulfilled, constitute the sole remedy against the Servicer for
such breach available to the Certificateholders or the Custodian; provided,
however, that the Servicer shall indemnify the Issuer, the Backup Servicer, the
Custodian and the Certificateholders from and against all costs, expenses,
losses, damages, claims and liabilities, including reasonable fees and expenses
of counsel, which may be asserted against or incurred by any of them as a result
of third party claims arising out of the events or facts giving rise to such
breach. This section shall survive the termination of this Agreement and the
earlier removal or resignation of the Custodian and/or the Backup Servicer.
5.8 Total Servicing Fee; Payment of Certain Expenses by Servicer.
On each Distribution Date, the Servicer (provided that the Servicer is not
AmeriCredit Canada) shall be entitled to receive out of the Collection Account a
monthly servicing fee equal to the product of one-twelfth times 2.25% of the
Pool Balance as of the opening of business on the first day of the related
Collection Period (the "Servicing Fee") pursuant to Section 6.4. The Servicer
shall be required to pay all expenses incurred by it in connection with its
activities under this Agreement (including taxes imposed on the Servicer,
expenses incurred in connection with distributions and reports made by the
Servicer to Certificateholders and all other fees and expenses of the Backup
Servicer or the Custodian, except taxes levied or assessed against the Custodian
or the Certificateholders, and claims against the Custodian or the
Certificateholders in respect of indemnification, which taxes and claims in
respect of indemnification against the
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Custodian or the Certificateholders are expressly stated to be for the account
of AmeriCredit Canada). The Servicer shall be liable for the fees and expenses
of the Backup Servicer, the Custodian, the Depository Bank (and any fees under
the Depository Agreement) and the Independent Accountants. Notwithstanding the
foregoing, if the Servicer shall not be AmeriCredit Canada, a successor to
AmeriCredit Canada as Servicer including the Backup Servicer permitted by
Section 10.3 shall not be liable for taxes levied or assessed against the
Custodian or the Certificateholders or claims against the Custodian or the
Certificateholders in respect of indemnification, or the fees and expenses
referred to above.
5.9 Servicer's Certificate.
On or prior to 12:00 p.m. (Toronto time) each Distribution Date, the
Servicer shall deliver (facsimile delivery being acceptable) to the Custodian,
the Backup Servicer and each Rating Agency a Servicer's Certificate executed by
a Responsible Officer of the Servicer containing among other things, (i) all
information necessary to enable the Custodian to make any withdrawal and deposit
required by Error! Reference source not found. and to make the distributions
required by Error! Reference source not found., (ii) a listing of all Purchased
Automobile Loans purchased as of the related Accounting Date, identifying the
Automobile Loans so purchased, (iii) all information necessary to enable the
Custodian to send the statements to Certificateholders required by Article 6 and
(iv) all information necessary to enable the Custodian to reconcile the
aggregate cash flows to and from the Collection Account for the related
Collection Period and Distribution Date, including the accounting required by
Article 6. Automobile Loans purchased by the Servicer on the related Accounting
Date and each Automobile Loan which became a Liquidated Automobile Loan or which
was paid in full during the related Collection Period shall be identified by
account number (as set forth in the Schedule of Automobile Loans).
5.10 Annual Statement as to Compliance, Notice of Servicer Termination
Event.
(a) The Servicer shall deliver to the Custodian, the Backup Servicer
and each Rating Agency, on or before October 31 (or 120 days after the end of
the Servicer's fiscal year, if other than June 30) of each year, beginning on
October 31, 2003, an officer's certificate signed by any Responsible Officer of
the Servicer, dated as of June 30 (or other applicable date) of such year,
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 (which period shall not be less
than six months)) and of its performance under this Agreement has been made
under such Responsible Officer's supervision, and (ii) to such Responsible
Officer's knowledge, based on such review, the Servicer has fulfilled all its
obligations under this Agreement throughout such period, or, if there has been a
default in the fulfilment of any such obligation, specifying each such default
known to such Responsible Officer and the nature and status thereof.
(b) The Seller or the Servicer shall deliver to the Custodian, the
Backup Servicer, the Servicer or the Seller (as applicable) and each Rating
Agency promptly after having obtained knowledge thereof, but in no event later
than two (2) Business Days thereafter, written notice in an officer's
certificate of any event which with the giving of notice or lapse of time, or
both, would become a Servicer Termination Event.
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5.11 Annual Independent Accountants' Report.
The Servicer shall cause a firm of nationally recognized independent
certified public accountants (the "Independent Accountants"), who may also
render other services to the Servicer or to the Seller, to deliver to the
Custodian, the Backup Servicer and each Rating Agency, on or before October 31
(or 120 days after the end of the Servicer's fiscal year, if other than June 30)
of each year, beginning on October 31, 2003, with respect to the twelve months
ended the immediately preceding June 30 (or other applicable date) (or such
other period as shall have elapsed from the Closing Date to the date of such
certificate (which period shall not be less than six months)), a statement (the
"Accountants' Report") addressed to the board of directors of the Servicer and
to the Custodian, to the effect that such firm has audited the books and records
of AmeriCredit Corp., in which the Servicer is included as a consolidated
subsidiary, and issued its report thereon in connection with the audit report on
the consolidated financial statements of AmeriCredit Corp. or has audited such
other books and records as may be necessary for a Servicer other than
AmeriCredit Canada, and that (i) such audit was made in accordance with
generally accepted auditing standards, and accordingly included such tests of
the accounting records and such other auditing procedures as such firm
considered necessary in the circumstances, (ii) the firm is independent of the
Seller and the Servicer within the meaning of the Code of Professional Ethics of
the American Institute of Certified Public Accountants, and (iii) includes a
report on the application of agreed upon procedures to three randomly selected
Servicer's Certificates noting whether any exceptions or errors in the
Servicer's Certificates were found.
5.12 Access to Certain Documentation and Information Regarding Automobile
Loans.
The Servicer shall provide to representatives of each of the Custodian
and the Backup Servicer reasonable access to the documentation regarding the
Automobile Loans. In each case, such access shall be afforded without charge but
only upon reasonable request and during normal business hours. Nothing in this
Section shall affect the obligation of the Servicer to observe any applicable
law prohibiting disclosure of information regarding the Obligors, and the
failure of the Servicer to provide access as provided in this Section as a
result of such obligation shall not constitute a breach of this Section.
5.13 Monthly Tape.
On or before each Distribution Date, the Servicer will deliver to the
Custodian and the Backup Servicer a computer tape and a diskette (or any other
electronic transmission acceptable to the Custodian and the Backup Servicer) in
a format acceptable to the Custodian and the Backup Servicer containing the
information with respect to the Automobile Loans as of the preceding Accounting
Date necessary for preparation of the Servicer's Certificate relating to the
immediately preceding Collection Period and necessary to review the application
of collections as provided in Article 6. In addition, upon the occurrence of a
Servicer Termination Event the Servicer shall, if so requested by the Custodian,
deliver to the Backup Servicer its Collection Records and its Monthly Records
within 15 days after demand therefor and a computer tape containing as of the
close of business on the date of demand all of the data maintained by the
Servicer in computer format in connection with servicing the Automobile Loans.
Other than the duties specifically set forth in this Agreement, the Backup
Servicer shall have no obligations
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hereunder, including, without limitation, to supervise, verify, monitor or
administer the performance of the Servicer. The Backup Servicer shall have no
liability for any actions taken or omitted by the Servicer.
5.14 Fidelity Bond and Errors and Omissions Policy.
The Servicer has obtained, and shall continue to maintain in full force
and effect, a fidelity bond and errors and omissions policy of a type and in
such amount as is customary for servicers engaged in the business of servicing
automobile loans.
ARTICLE 6
CUSTODIAL ACCOUNTS; DISTRIBUTIONS;
STATEMENTS TO CERTIFICATEHOLDERS
6.1 Establishment of Custodial Accounts.
(a) (i) The Custodian, on behalf of the Certificateholders, will
establish and maintain in its own name an Eligible Deposit Account (the
"Collection Account"), bearing a designation clearly indicating that the funds
deposited therein are held for the benefit of the Custodian on behalf of the
Certificateholders.
(i) The Custodian, on behalf of the Certificateholders, shall
establish and maintain in its own name an Eligible Deposit Account (the
"Accumulation Account"), bearing a designation clearly indicating that the funds
deposited therein are held for the benefit of the Custodian on behalf of the
Certificateholders.
(ii) The Custodian, on behalf of the Certificateholders, shall
establish and maintain in its own name an Eligible Deposit Account (the "Spread
Account"), bearing a designation clearly indicating that the funds deposited
therein are held for the benefit of the Custodian on behalf of the
Certificateholders. On the Closing Date, the Issuer shall deposit (or cause to
be deposited) $4,907,052.95 to the Spread Account.
(b) Funds on deposit in the Collection Account, the Accumulation
Account and the Spread Account (collectively, the "Custodial Accounts") shall be
invested by the Custodian (or any custodian with respect to funds on deposit in
any such account) in Eligible Investments selected in writing by the Servicer
(pursuant to standing instructions or otherwise); provided however, it is
understood and agreed that the Custodian and the Servicer shall not be liable
for the selection of, or any loss arising from such investment in, Eligible
Investments. All such Eligible Investments shall be held by or on behalf of the
Custodian for the benefit of the Certificateholders. Other than as permitted by
the Rating Agencies, funds on deposit in any Custodial Account shall be invested
in Eligible Investments that will mature so that such funds will be available at
the close of business on the Business Day immediately preceding the following
Distribution Date; provided that on the Business Day preceding each Distribution
Date all Investment Earnings on funds on deposit therein shall be deposited into
the Collection Account and shall be deemed to constitute a portion of the
Available Funds for such Distribution Date. Funds deposited in a Custodial
Account on the day immediately preceding a Distribution
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Date upon the maturity of any Eligible Investments are not required to be
invested overnight. All Eligible Investments will be held to maturity.
(c) All investment earnings of moneys deposited in the Custodial
Accounts shall be deposited (or caused to be deposited) by the Custodian in the
Collection Account, and any loss resulting from such investments shall be
charged to such account. The Servicer will not direct the Custodian to make any
investment of any funds held in any of the Custodial Accounts unless the
security interest granted and perfected in such account will continue to be
perfected in such investment, in either case without any further action by any
Person, and, in connection with any direction to the Custodian to make any such
investment, if requested by the Custodian, the Servicer shall deliver to the
Custodian an Opinion of Counsel, acceptable to the Custodian, to such effect.
(d) The Custodian shall not in any way be held liable by reason of any
insufficiency in any of the Custodial Accounts resulting from any loss on any
Eligible Investment included therein except for losses attributable to the
Custodian's gross negligence or bad faith or its failure to make payments on
such Eligible Investments issued by the Custodian, in its commercial capacity as
principal obligor and not as trustee, in accordance with their terms.
(e) If the Servicer shall have failed to give investment directions in
writing for any funds on deposit in the Custodial Accounts to the Custodian by
1:00 p.m. Toronto time (or such other time as may be agreed by the Issuer and
Custodian) on any Business Day, amounts collected or receivable from the ACAR
Series 2002-A Certificateholders' Assets will be applied as if there had not
been such directions; then the Custodian shall, to the fullest extent
practicable, invest and reinvest funds in the Custodial Accounts in the
investment described in clause (g) of the definition of Eligible Investments.
(f) The Certificateholders shall possess all right, title and interest
in all funds on deposit from time to time in the Custodial Accounts and in all
proceeds thereof (including all Investment Earnings on the Custodial Accounts)
and all such funds, investments, proceeds and income shall be part of the ACAR
Series 2002-A Certificateholders' Assets. Except as otherwise provided herein,
the Custodial Accounts shall be under the sole dominion and control of the
Custodian for the benefit of the Certificateholders. If, at any time, any of the
Custodial Accounts ceases to be an Eligible Deposit Account, the Custodian (or
the Servicer on its behalf) shall within five Business Days (or such longer
period as to which each Rating Agency may consent) establish a new Custodial
Account as an Eligible Deposit Account and shall transfer any cash and/or any
investments to such new Custodial Account. In connection with the foregoing, the
Servicer agrees that it shall notify the Custodian in writing promptly upon any
of such Custodial Accounts ceasing to be an Eligible Deposit Account.
(g) The Servicer shall have the power to instruct the Custodian to make
withdrawals and payments from the Custodial Accounts for the purpose of
permitting the Servicer and the Custodian to carry out their respective duties
hereunder.
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6.2 Certain Reimbursements to the Servicer.
The Servicer will be entitled to be reimbursed from amounts on deposit
in the Collection Account with respect to a Collection Period for amounts
previously deposited in the Collection Account but later determined by the
Servicer to have resulted from mistaken deposits or postings or cheques returned
for insufficient funds. The amount to be reimbursed hereunder shall be paid to
the Servicer on the related Distribution Date pursuant to Section 6.4(a)(i) upon
certification by the Servicer of such amounts and the provision of such
information to the Custodian as may be necessary in the opinion of the Custodian
to verify the accuracy of such certification; provided, however, that the
Servicer must provide such clarification within 12 months of such mistaken
deposit, posting, or returned cheque. The Servicer will additionally be entitled
to receive from amounts on deposit in the Collection Account with respect to a
Collection Period any amounts paid by Obligors that were collected in the
Depository Account but that do not relate to (i) principal and interest payments
due on the Automobile Loans or (ii) any fees or expenses related to extensions
due on the Automobile Loans.
6.3 Application of Collections.
(a) All collections or payments by or on behalf of the Obligor for the
Collection Period with respect to each Automobile Loan (other than a Purchased
Automobile Loan) shall be applied by the Servicer to interest and principal in
accordance with the Simple Interest Method.
(b) The Servicer and the Seller, as applicable, shall deposit or cause
to be deposited in the Collection Account on the Determination Date on which
such obligations are due the aggregate Purchase Amount with respect to Purchased
Automobile Loans.
(c) Any Optional Purchase Price payable by the Servicer under Section
12.2 shall be deposited in the Collection Account.
(d) If the Certificate Balance Accumulation Amount on deposit in the
Accumulation Account on the Targeted Certificate Balance Distribution Date for a
Class of Offered Certificates is or will be less than the outstanding
Certificate Balance of such Class (after giving effect to all deposits made or
to be made to the Accumulation Account on such date other than pursuant to this
Section), the Servicer will have the option to make an advance (a "Maturity
Advance") in any amount up to the amount of such shortfall. If the Servicer
elects to make a Maturity Advance it shall deposit the amount of the Maturity
Advance into the Accumulation Account on the related Targeted Certificate
Balance Distribution Date in immediately available funds.
6.4 Distribution Date Payments From the Collection Account.
(a) On each Distribution Date, the Custodian shall (based solely on the
information contained in the Servicer's Certificate delivered with respect to
the related Distribution Date) distribute the following amounts of Available
Funds from the Collection Account unless otherwise specified and in the
following order of priority:
(i) in the event that AmeriCredit Canada is no longer Servicer,
to the Servicer, the Servicing Fee for the preceding
Collection Period and other amounts relating to mistaken
deposits, postings or cheques returned for
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insufficient funds during the preceding Collection
Period, and to pay to AmeriCredit Canada, any amounts
paid by Obligors during the Collection Period that were
collected in the Depository Account or the Collection
Account but did not relate to (i) principal and interest
payments due on the Automobile Loans or (ii) any fees or
expenses related to extensions due on the Automobile
Loans;
(ii) to the Custodian and the Backup Servicer, their
respective accrued and unpaid fees and expenses then due
to each of them;
(iii) to the Accumulation Account, the aggregate of the
Certificateholders' Certificate Rate Distributable
Amounts for such Distribution Date;
(iv) to the Servicer, any outstanding Maturity Advances;
(v) to the Accumulation Account, the Certificateholders'
Certificate Balance Distributable Amount for such
Distribution Date; and
(vi) to