-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, EEuMdMlu7KJGo+sJZRwT2PMtNl+b2qlzuBq2dqykHIljuGj37kA2SHo4oID38sCv LSu08b5rTvjSUO59YFvDAQ== 0000912057-01-517023.txt : 20010522 0000912057-01-517023.hdr.sgml : 20010522 ACCESSION NUMBER: 0000912057-01-517023 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 12 CONFORMED PERIOD OF REPORT: 20010515 ITEM INFORMATION: ITEM INFORMATION: FILED AS OF DATE: 20010521 FILER: COMPANY DATA: COMPANY CONFORMED NAME: TOYOTA AUTO FINANCE RECEIVABLES LLC CENTRAL INDEX KEY: 0001131131 STANDARD INDUSTRIAL CLASSIFICATION: ASSET-BACKED SECURITIES [6189] IRS NUMBER: 334836519 STATE OF INCORPORATION: DE FISCAL YEAR END: 0331 FILING VALUES: FORM TYPE: 8-K SEC ACT: SEC FILE NUMBER: 333-58164 FILM NUMBER: 1644917 BUSINESS ADDRESS: STREET 1: 19300 GRAMERCY PLACE CITY: TORRANCE STATE: CA ZIP: 90509 BUSINESS PHONE: 3107871310 MAIL ADDRESS: STREET 1: 19300 GRAMERCY PLACE CITY: TORRANCE STATE: CA ZIP: 90509 FILER: COMPANY DATA: COMPANY CONFORMED NAME: TOYOTA MOTOR CREDIT CORP CENTRAL INDEX KEY: 0000834071 STANDARD INDUSTRIAL CLASSIFICATION: PERSONAL CREDIT INSTITUTIONS [6141] IRS NUMBER: 953775816 STATE OF INCORPORATION: CA FISCAL YEAR END: 0331 FILING VALUES: FORM TYPE: 8-K SEC ACT: SEC FILE NUMBER: 001-09961 FILM NUMBER: 1644918 BUSINESS ADDRESS: STREET 1: 19300 GRAMERCY PLACE STREET 2: NORTH BUILDING CITY: TORRANCE STATE: CA ZIP: 90509 BUSINESS PHONE: 3107871310 MAIL ADDRESS: STREET 1: 19300 GRAMERCY PLACE STREET 2: NORTH BUILDING CITY: TORRANCE STATE: CA ZIP: 90509 8-K 1 a2049889z8-k.txt 8-K FORM 8-K CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES AND EXCHANGE ACT OF 1934 Date of Report: May 15, 2001 ---------------------------- (Date of earliest event reported) TOYOTA AUTO FINANCE RECEIVABLES LLC ON BEHALF OF THE TOYOTA AUTO RECEIVABLES 2001-B OWNER TRUST -------------------------------------------------------------- (Exact name of registrant as specified in its charter) CALIFORNIA 333-41568 33-4836519 333-58164 (State or Other Jurisdiction (Commission File Number) (I.R.S. Employer of Incorporation) Identification No.) 19300 Gramercy Place, North Building Torrance, California 90509 ---------------------------------- (Address of principal executive offices) Registrant's telephone number, including area code: (310) 468-7333 ITEM 5. OTHER EVENTS On May 15, 2001, Toyota Auto Finance Receivables LLC ("TAFR LLC") and Toyota Motor Credit Corporation ("TMCC") entered into that certain Receivables Purchase Agreement dated as of April 1, 2001 (the "Receivables Purchase Agreement"), pursuant to which TMCC transferred to TAFR LLC certain retail installment sales contracts relating to certain new and used automobiles and light duty trucks (the "Receivables") and related property. On May 15, 2001, the Toyota Auto Receivables 2001-B Owner Trust, a Delaware business trust created pursuant to that certain Amended and Restated Trust Agreement dated as of April 1, 2001 (the "Trust Agreement"), by and between TAFR LLC, as depositor, and First Union Trust Company, National Association, as owner trustee (the "Trust"), TAFR LLC, as seller, and TMCC, as servicer, entered into that certain Sale and Servicing Agreement dated as of April 1, 2001 (the "Sale and Servicing Agreement"), pursuant to which the Receivables and related property were transferred to the Trust. On May 15, 2001, the Trust caused the issuance, pursuant to that certain Indenture dated as of April 1, 2001 (the "Indenture"), by and between the Trust, as issuer, and Wells Fargo Bank Minnesota, National Association, as indenture trustee and securities intermediary, and pursuant to the Sale and Servicing Agreement, of the Notes, issued in the following classes: Class A-1, Class A-2, Class A-3, Class A-4 (collectively, the "Notes"). On May 15, 2001, the Trust, TMCC as administrator, Wells Fargo Bank Minnesota, National Association as indenture trustee and First Union Trust Company, National Association as owner trustee entered into that certain Administration Agreement (the "Administration Agreement"), pursuant to which TMCC agreed to perform certain duties of the Issuer, the Owner Trustee and the Indenture Trustee. On May 15, 2001, the Trust entered into that certain ISDA Master Agreement (the "Master Agreement") dated as of May 15, 2001, a Schedule to the Swap Agreement dated as of May 15, 2001 (the "Schedule"), a Class A-2 Confirmation to the Swap Agreement dated as of May 15, 2001 (the "Class A-2 Confirmation"), a Class A-3 Confirmation to the Swap Agreement dated as of May 15, 2001 (the "Class A-3 Confirmation"), and a Class A-4 Confirmation to the Swap Agreement dated as of May 15, 2001 (the "Class A-4 Confirmation", and together with the Master Agreement, the Schedule, the Class A-2 Confirmation, and the Class A-3 Confirmation, the "Swap Agreement"), collectively embodying two interest rate swaps between the Trust and TMCC, as swap counterparty. On May 15, 2001, the Trust, as assignor, Wells Fargo Bank Minnesota, National Association, as assignee, and TMCC, as swap counterparty, entered into that certain Assignment of the Swap Agreement dated as of May 15, 2001 (the "Assignment"), pursuant to which the Trust assigned its interest in the Swap Agreement to Wells Fargo Bank Minnesota, National Association, as the Indenture Trustee. On May 15, 2001, $500,000,000 of the Class A-2 Notes, $360,000,000 of the Class A-3 Notes and $175,000,000 of the Class A-4 Notes were sold to Morgan Stanley & Co. Incorporated, Salomon Smith Barney Inc., Banc of America Securities LLC, J.P. Morgan Securities Inc., Deutsche Bank Securities Inc. and Merrill Lynch, Pierce, Fenner & Smith Incorporated, as underwriters (the "Underwriters"), pursuant to an Underwriting Agreement dated as of May 1, 2001, by and among TAFR LLC, TMCC and the Underwriters. The Underwriting Agreement was filed as Exhibit 1.1 to an 8-K filing on May 15, 2001. The Notes have been registered pursuant to the Securities Act of 1933, as amended, under Registration Statements on Form S-3 (Commission File Nos. 333-41568 and 333-58164). Capitalized terms used herein and not defined herein have the meanings ascribed thereto in the Sale and Servicing Agreement. Attached as Exhibit 4.1 is the Sale and Servicing Agreement, as Exhibit 4.2 is the Indenture, as Exhibit 4.3 is the Receivables Purchase Agreement, as Exhibit 4.4 is the Trust Agreement, as Exhibit 4.5 is the Administration Agreement, as Exhibit 4.6 is the Master Swap Agreement, as Exhibit 4.7 is the Schedule to the Swap Agreement, as Exhibit 4.8 is the Class A-2 Confirmation to the Swap Agreement , as Exhibit 4.9 is the Class A-3 Confirmation to the Swap Agreement, as Exhibit 4.10 is the Class A-4 Confirmation to the Swap Agreement and as Exhibit 4.11 is the Assignment of the Swap Agreement. 2 EXHIBIT INDEX ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS (a) Not applicable. (b) Not applicable. (c) Exhibits The exhibit number corresponds with Item 601(a) of Regulation S-K.
EXHIBIT NO. DESCRIPTION ----------- ----------- Exhibit 4.1 Sale and Servicing Agreement dated as of April 1, 2001, by and among the Registrant, as issuer, TAFR LLC, as seller, and TMCC, as servicer. Exhibit 4.2 Indenture dated as of April 1, 2001, by and between the Registrant, as issuer, and Wells Fargo Bank Minnesota, National Association, as indenture trustee and securities intermediary. Exhibit 4.3 Receivables Purchase Agreement dated as of April 1, 2001, by and between TAFR LLC, as purchaser, and TMCC, as seller. Exhibit 4.4 Amended and Restated Trust Agreement dated as of April 1, 2001, by and between TAFR LLC, as depositor, and First Union Trust Company, National Association, as owner trustee. Exhibit 4.5 Administration Agreement dated as of April 1, 2001, by and among the Registrant, as issuer, TMCC, as administrator, Wells Fargo Bank Minnesota, National Association, as indenture trustee, and First Union Trust Company, National Association, as owner trustee. Exhibit 4.6 Swap Agreement dated as of May 1, 2001, between the Registrant, as issuer, and TMCC, as swap counterparty. Exhibit 4.7 Schedule to the Swap Agreement dated as of May 15, 2001, between the Registrant, as issuer, and TMCC, as swap counterparty. Exhibit 4.8 Class A-2 Confirmation to the Swap Agreement dated as of May 15, 2001, between the Registrant, as issuer, and TMCC, as swap counterparty. Exhibit 4.9 Class A-3 Confirmation to the Swap Agreement dated as of May 15, 2001, between the Registrant, as issuer, and TMCC, as swap counterparty. Exhibit 4.10 Class A-4 Confirmation to the Swap Agreement dated as of May 15, 2001, between the Registrant, as issuer, and TMCC, as swap counterparty. Exhibit 4.11 Assignment of the Swap Agreement dated as of May 15, 2001, by and among the Registrant, as assignor, Wells Fargo Bank Minnesota, National Association, as assignee, and TMCC, as swap counterparty.
3 Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on behalf of the Registrant by the undersigned thereunto duly authorized. TOYOTA AUTO FINANCE RECEIVABLES LLC By: /s/ Lloyd Mistele ------------------------------ Name: Lloyd Mistele Title: President May 21, 2001 4 EXHIBIT INDEX Item 601(a) of Regulation S-K
EXHIBIT NO. DESCRIPTION - ----------- ----------- Exhibit 4.1 Sale and Servicing Agreement dated as of April 1, 2001, by and among the Registrant, as issuer, TAFR LLC, as seller, and TMCC, as servicer. Exhibit 4.2 Indenture dated as of April 1, 2001, by and between the Registrant, as issuer, and Wells Fargo Bank Minnesota, National Association, as indenture trustee. Exhibit 4.3 Receivables Purchase Agreement dated as of April 1, 2001, by and between TAFR LLC, as purchaser, and TMCC, as seller. Exhibit 4.4 Amended and Restated Trust Agreement dated as of April 1, 2001, by and between TAFR LLC, as depositor, and First Union Trust Company, National Association, as owner trustee. Exhibit 4.5 Administration Agreement dated as of April 1, 2001, by and among the Registrant, as issuer, TMCC, as administrator, Wells Fargo Bank Minnesota, National Association, as indenture trustee, and First Union Trust Company, National Association, as owner trustee. Exhibit 4.6 Swap Agreement dated as of May 1, 2001, between the Registrant, as issuer, and TMCC, as swap counterparty. Exhibit 4.7 Schedule to the Swap Agreement dated as of May 15, 2001, between the Registrant, as issuer, and TMCC, as swap counterparty. Exhibit 4.8 Class A-2 Confirmation to the Swap Agreement dated as of May 15, 2001, between the Registrant, as issuer, and TMCC, as swap counterparty. Exhibit 4.9 Class A-3 Confirmation to the Swap Agreement dated as of May 15, 2001, between the Registrant, as issuer, and TMCC, as swap counterparty. Exhibit 4.10 Class A-4 Confirmation to the Swap Agreement dated as of May 15, 2001, between the Registrant, as issuer, and TMCC, as swap counterparty. Exhibit 4.11 Assignment of the Swap Agreement dated as of May 15, 2001, by and among the Registrant, as assignor, Wells Fargo Bank Minnesota, National Association, as assignee, and TMCC, as swap counterparty.
5 EX-4.1 2 a2049889zex-4_1.txt EXHIBIT 4.1 EXHIBIT 4.1 SALE AND SERVICING AGREEMENT among TOYOTA AUTO RECEIVABLES 2001-B OWNER TRUST, as Issuer, TOYOTA AUTO FINANCE RECEIVABLES LLC, as Seller, and TOYOTA MOTOR CREDIT CORPORATION, as Servicer Dated as of April 1, 2001 ARTICLE I DEFINITIONS SECTION 1.01 Definitions........................................................................................1 SECTION 1.02 Usage of Terms....................................................................................22 ARTICLE II CONVEYANCE OF RECEIVABLES SECTION 2.01 Conveyance of Receivables.........................................................................23 SECTION 2.02 Custody of Receivables Files......................................................................24 SECTION 2.03 Acceptance by Owner Trustee.......................................................................25 ARTICLE III THE RECEIVABLES SECTION 3.01 Representations and Warranties of the Seller with Respect to the Receivables................................................................................25 SECTION 3.02 Repurchase upon Breach............................................................................28 SECTION 3.03 Duties of Servicer as Custodian...................................................................29 SECTION 3.04 Instructions; Authority To Act....................................................................29 SECTION 3.05 Custodian's Indemnification.......................................................................30 SECTION 3.06 Effective Period and Termination..................................................................30 ARTICLE IV ADMINISTRATION AND SERVICING OF RECEIVABLES SECTION 4.01 Duties of Servicer................................................................................30 SECTION 4.02 Collection and Allocation of Receivable Payments..................................................31 SECTION 4.03 Rebates on Full Prepayments.......................................................................32 SECTION 4.04 Realization upon Receivables......................................................................32 SECTION 4.05 Physical Damage Insurance.........................................................................32 SECTION 4.06 Maintenance of Security Interests in Financed Vehicles............................................33 SECTION 4.07 Covenants of Servicer.............................................................................33 SECTION 4.08 Purchase of Receivables upon Breach...............................................................33 SECTION 4.09 Servicing Fee and Expenses........................................................................34 SECTION 4.10 Servicer's Certificate............................................................................34 SECTION 4.11 Annual Statement as to Compliance; Notice of Default..............................................34 SECTION 4.12 Annual Accountants' Report........................................................................35 SECTION 4.13 Access to Certain Documentation and Information Regarding Receivables.......................................................................................35 SECTION 4.14 Appointment of Subservicer........................................................................36 SECTION 4.15 Amendments to Schedule of Receivables.............................................................36 SECTION 4.16 Reports to Securityholders and Rating Agencies....................................................36
i ARTICLE V ACCOUNTS; PAYMENTS AND DISTRIBUTIONS; STATEMENTS TO SECURITYHOLDERS SECTION 5.01 Establishment of Collection Account and Payahead Account..........................................36 SECTION 5.02 Collections.......................................................................................38 SECTION 5.03 Application of Collections........................................................................39 SECTION 5.04 Advances; Swap Payments...........................................................................40 SECTION 5.05 Additional Deposits...............................................................................41 SECTION 5.06 Payments and Distributions........................................................................42 SECTION 5.07 Reserve Account...................................................................................45 SECTION 5.08 Statements to Certificateholder, Noteholders, and Swap Counterparty...............................46 SECTION 5.09 Net Deposits......................................................................................47 ARTICLE VI THE SELLER SECTION 6.01 Representations of Seller.........................................................................47 SECTION 6.02 Corporate Existence...............................................................................48 SECTION 6.03 Liability of Seller; Indemnities..................................................................49 SECTION 6.04 Merger or Consolidation of, or Assumption of the Obligations of, Seller...........................50 SECTION 6.05 Limitation on Liability of Seller and Others......................................................50 SECTION 6.06 Seller May Own Certificate or Notes...............................................................50 ARTICLE VII THE SERVICER SECTION 7.01 Representations of Servicer.......................................................................51 SECTION 7.02 Indemnities of Servicer...........................................................................52 SECTION 7.03 Merger or Consolidation of, or Assumption of the Obligations of, Servicer......................................................................................53 SECTION 7.04 Limitation on Liability of Servicer and Others....................................................54 SECTION 7.05 TMCC Not To Resign as Servicer....................................................................54 ARTICLE VIII DEFAULT SECTION 8.01 Servicer Default..................................................................................55 SECTION 8.02 Appointment of Successor..........................................................................56 SECTION 8.03 Repayment of Advances; Compensation Payable.......................................................57 SECTION 8.04 Notification......................................................................................57 ARTICLE IX TERMINATION SECTION 9.01 Optional Purchase of All Receivables..............................................................57 SECTION 9.02 Termination of the Trust Agreement................................................................59
ii ARTICLE X MISCELLANEOUS SECTION 10.01 Amendment........................................................................................59 SECTION 10.02 Protection of Title to Trust.....................................................................60 SECTION 10.03 Notices..........................................................................................62 SECTION 10.04 Assignment by the Seller or the Servicer.........................................................62 SECTION 10.05 Limitations on Rights of Others..................................................................62 SECTION 10.06 Severability.....................................................................................62 SECTION 10.07 Separate Counterparts............................................................................62 SECTION 10.08 Headings.........................................................................................63 SECTION 10.09 Governing Law....................................................................................63 SECTION 10.10 Assignment by Issuer.............................................................................63 SECTION 10.11 Nonpetition Covenants............................................................................63 SECTION 10.12 Limitation of Liability of Owner Trustee and Indenture Trustee...................................63 SCHEDULE A Schedule of Receivables EXHIBIT A Form of Servicer's Certificate
iii SALE AND SERVICING AGREEMENT dated as of April 1, 2001, among TOYOTA AUTO RECEIVABLES 2001-B OWNER TRUST, a Delaware business trust (the "Issuer"), TOYOTA AUTO FINANCE RECEIVABLES LLC, a Delaware limited liability company ("TAFR LLC" or the "Seller"), and TOYOTA MOTOR CREDIT CORPORATION, a California corporation ("TMCC" or the "Servicer"). WHEREAS the Issuer desires to purchase a portfolio of receivables arising in connection with retail installment sales contracts secured by new or used automobiles and light duty trucks generated by Toyota Motor Credit Corporation in the ordinary course of business and sold to the Seller; WHEREAS the Seller is willing to sell such receivables to the Issuer; and WHEREAS the Servicer is willing to service such receivables; NOW, THEREFORE, in consideration of the premises and the mutual covenants herein contained, the parties hereto agree as follows: ARTICLE I DEFINITIONS SECTION 1.01 DEFINITIONS. Except as otherwise provided in this Agreement, whenever used herein, the following words and phrases, unless the context otherwise requires, shall have the following meanings: "ACTUAL PAYMENT" means, with respect to a Receivable and a Collection Period, all payments received by the Servicer from or for the account of the related Obligor on such Receivable during such Collection Period (and, in the case of the first Collection Period, all payments received by the Servicer from or for the account of such Obligor since the Cutoff Date through the last day of such Collection Period), net of any Supplemental Servicing Fees attributable to such Receivable. Actual Payments do not include Applied Payments Ahead. "ACTUARIAL RECEIVABLE" means any Receivable which provides for the allocation of payments according to the "actuarial" method. "ADMINISTRATIVE PURCHASE PAYMENT" means, with respect to a Payment Date and to (1) an Administrative Receivable which is a Precomputed Receivable purchased by the Servicer as of the close of business on the last day of the related Collection Period, (a) the sum of (i) all Scheduled Payments on such Receivable due after the last day of such Collection Period, (ii) an amount equal to any reimbursement of Outstanding Advances made pursuant to Section 5.04(c) with respect to such Receivable and (iii) all past due Scheduled Payments for which an Advance has not been made, minus (b) all Payments Ahead with respect to such Receivable then on deposit in the Payahead Account and the Rebate, if any, paid to the Obligor on a Precomputed Receivable on or before the date of such purchase and (2) an Administrative Receivable which is a Simple Interest Receivable purchased by the Servicer during the related Collection Period, the sum of (a) the unpaid Principal Balance owed by the Obligor in respect of such Receivable plus 1 (b) interest on such unpaid Principal Balance at a rate equal to the related APR to the last day in the related Collection Period. "ADMINISTRATION AGREEMENT" means the Administration Agreement dated as of April 1, 2001, among the Administrator, the Issuer and the Indenture Trustee. "ADMINISTRATIVE RECEIVABLE" means a Receivable which the Servicer is required to purchase pursuant to Section 3.02 or 4.08 or which the Servicer has elected to purchase pursuant to Section 9.01. "ADMINISTRATOR" means TMCC, or any successor Administrator under the Administration Agreement. "ADVANCE" means a Precomputed Advance or Simple Interest Advance. "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 specified Person, means the power to direct the management and policies of such Person, directly or indirectly, whether through the ownership of voting securities, by contract or otherwise; and the term "controlling" and "controlled" have meanings correlative to the foregoing. "AGGREGATE NET LOSSES" means, with respect to a Collection Period, an amount equal to the aggregate Principal Balance of all Receivables that became Defaulted Receivables during such Collection Period minus the sum of (x) all Net Liquidation Proceeds collected during such Collection Period with respect to Defaulted Receivables and (y) all amounts received during such Collection Period in respect of the Receivables liquidated in prior Collection Periods net of any Liquidation Expenses incurred during such Collection Period in connection with the recovery of such amounts. "AGREEMENT" means this Sale and Servicing Agreement among the Toyota Auto Receivables 2001-B Owner Trust, as Issuer, TAFR LLC, as seller, and TMCC, as servicer, as the same may be amended or supplemented from time to time. "AMOUNT FINANCED" in respect of a Receivable means the aggregate amount advanced under such Receivable toward the purchase price of the related Financed Vehicle and any related costs, including but not limited to accessories, insurance premiums, service and warranty contracts and other items customarily financed as part of retail automobile and light duty truck installment sale contracts. "ANNUAL PERCENTAGE RATE" or "APR" of a Receivable means the annual rate of finance charges specified in such Receivable. "APPLIED PAYMENT AHEAD" means, with respect to a Precomputed Receivable and a Collection Period as to which (a) the Actual Payment is less than the Scheduled Payment and (b) a Deferred Prepayment is on deposit in the Payahead Account, an amount equal to the lesser of (i) such Deferred Prepayment and (ii) the amount by which the Scheduled Payment exceeds the Actual Payment. 2 "AVAILABLE COLLECTIONS" means, with respect to any Payment Date, the total of the following amounts received by the Servicer on or in respect of the Receivables during (or for application with respect to) the related Collection Period (in the case of the Precomputed Receivables, computed in accordance with the actuarial method and in the case of the Simple Interest Receivables, computed in accordance with the simple interest method): (a) the sum of all (i) collections on or in respect of all Receivables other than Defaulted Receivables (including Applied Payments Ahead, but otherwise excluding Payments Ahead), (ii) Net Liquidation Proceeds, (iii) Advances made by the Servicer, (iv) all Warranty Purchase Payments, (v) all Swap Payments Incoming, (vi) all Swap Termination Payments made by the Swap Counterparty to the Issuer and (vii) all Administrative Purchase Payments, less (b) the sum of all (i) amounts received on or in respect of a particular Receivable (other than a Defaulted Receivable) to the extent of the aggregate Outstanding Advances in respect of such Receivable, (ii) Net Liquidation Proceeds with respect to a particular Receivable to the extent of the aggregate Outstanding Advances in respect of such Receivable, (iii) recoveries from collections on other Receivables to the extent of Advances made by the Servicer on a particular Receivable that the Servicer has determined are Nonrecoverable Advances, (iv) late fees, extension fees and other administrative fees and expenses or similar charges (which are payable to the Servicer as Supplemental Servicing Fees) collected by the Servicer, (v) all Swap Payments Outgoing, (vi) all Swap Termination Payments made by the Issuer to the Swap Counterparty and (vii) Rebates. "BASIC DOCUMENTS" means the Receivables Purchase Agreement, the Trust Agreement, the Certificate of Trust, this Sale and Servicing Agreement, the Indenture, the Administration Agreement, the Securities Account Control Agreement, the Note Depository Agreement and the other documents and certificates delivered in connection herewith and therewith. "BASIC SERVICING FEE" means the fee payable to the Servicer on each Payment Date, calculated pursuant to Section 4.09, for services rendered during the related Collection Period, which shall be equal to one-twelfth of the Servicing Fee Rate multiplied by the Pool Balance as of the first day of the related Collection Period or, with respect to the first Payment Date, the Original Pool Balance. "BOOK-ENTRY NOTES" means beneficial interests in Notes, ownership and transfer of which shall be made through book entries by a Clearing Agency as described in the Trust Agreement and the Indenture, respectively. "BUSINESS DAY" means any day other than a Saturday, a Sunday or a day on which banking institutions in New York, New York, Minneapolis, Minnesota, Wilmington, Delaware or San Francisco, California are authorized or obligated by law, executive order or governmental decree to be closed. "CERTIFICATE" has the meaning assigned in the Trust Agreement. "CERTIFICATEHOLDER" has the meaning assigned to such term in the Trust Agreement. 3 "CHARGE-OFF RATE" means, with respect to a Collection Period, the percentage equivalent of a fraction, the numerator of which is the Aggregate Net Losses for such Collection Period, and the denominator of which is the average of (i) the Pool Balance on the last day of the Collection Period immediately preceding such Collection Period and (ii) the Pool Balance on the last day of such Collection Period; such quotient is then multiplied by twelve to arrive at an annualized percentage. "CLASS" means any one of the classes of Notes. "CLASS A NOTE BALANCE" as of any date of determination, means the aggregate of the outstanding principal balances of the Class A-1 Notes, Class A-2 Notes, Class A-3 Notes and Class A-4 Notes. "CLASS A-1 FINAL SCHEDULED PAYMENT DATE" means the Payment Date in May, 2002. "CLASS A-1 INITIAL PRINCIPAL BALANCE" means $417,840,000.00. "CLASS A-1 INTEREST CARRYOVER SHORTFALL" means, with respect to any Payment Date, the excess, if any, of (x) the Class A-1 Interest Distributable Amount for such Payment Date and any outstanding Class A-1 Interest Carryover Shortfall from the immediately preceding Payment Date (together with interest on such outstanding Class A-1 Interest Carryover Shortfall at the Class A-1 Rate, to the extent lawful, calculated on the same basis as interest on the Class A-1 Notes for the same period), over (y) the amount of interest distributed to the Class A-1 Noteholders on such Payment Date. "CLASS A-1 INTEREST DISTRIBUTABLE AMOUNT" means the amount of interest accrued during the related Interest Period (calculated on the basis of the actual number of days in such Interest Period and a year assumed to consist of 360 days) on the Class A-1 Principal Balance as of the immediately preceding Payment Date (after giving effect to payments of principal made on such immediately preceding Payment Date) at the Class A-1 Rate or, in the case of the first Payment Date, on the Class A-1 Initial Principal Balance. "CLASS A-1 NOTE" means any of the 4.300% Asset Backed Notes, Class A-1, issued under the Indenture. "CLASS A-1 NOTEHOLDER" means any Person in whose name a Class A-1 Note is registered in the Note Register. "CLASS A-1 PRINCIPAL BALANCE" as of any date means the Class A-1 Initial Principal Balance less all amounts paid to the holders of Class A-1 Notes in respect of principal pursuant to Section 5.06 hereof. "CLASS A-1 RATE" means 4.300% per annum. "CLASS A-2 FINAL SCHEDULED PAYMENT DATE" means the Payment Date in December, 2003. 4 "CLASS A-2 INITIAL PRINCIPAL BALANCE" means $500,000,000.00. "CLASS A-2 INTEREST CARRYOVER SHORTFALL" means, with respect to any Payment Date, the excess, if any, of (x) the Class A-2 Interest Distributable Amount for such Payment Date and any outstanding Class A-2 Interest Carryover Shortfall from the immediately preceding Payment Date (together with interest on such outstanding Class A-2 Interest Carryover Shortfall at the Class A-2 Rate, to the extent lawful, calculated on the same basis as interest on the Class A-2 Notes for the same period), over (y) the amount of interest distributed to the Class A-2 Noteholders on such Payment Date. "CLASS A-2 INTEREST DISTRIBUTABLE AMOUNT" means the amount of interest accrued during the related Interest Period (calculated on the basis of the actual number of days in such Interest Period and a year assumed to consist of 360 days) on the Class A-2 Principal Balance as of the immediately preceding Payment Date (after giving effect to payments of principal made on such immediately preceding Payment Date) at the Class A-2 Rate or, in the case of the first Payment Date, on the Class A-2 Initial Principal Balance. "CLASS A-2 NOTE" means any of the Floating Rate Asset Backed Notes, Class A-2, issued under the Indenture. "CLASS A-2 NOTEHOLDER" means any Person in whose name a Class A-2 Note is registered in the Note Register. "CLASS A-2 NOTIONAL BALANCE" means the Class A-2 Principal Balance as of the first day of the applicable Interest Period. "CLASS A-2 NOTIONAL FIXED RATE" means 4.562%. "CLASS A-2 PRINCIPAL BALANCE" as of any date means the Class A-2 Initial Principal Balance less all amounts paid to the holders of Class A-2 Notes in respect of principal pursuant to Section 5.06 hereof. "CLASS A-2 RATE" means, with respect to any Interest Period, one-month LIBOR plus 0.060%. "CLASS A-3 FINAL SCHEDULED PAYMENT DATE" means the Payment Date in March, 2005. "CLASS A-3 INITIAL PRINCIPAL BALANCE" means $360,000,000.00. "CLASS A-3 INTEREST CARRYOVER SHORTFALL" means, with respect to any Payment Date, the excess, if any, of (x) the Class A-3 Interest Distributable Amount for such Payment Date and any outstanding Class A-3 Interest Carryover Shortfall from the immediately preceding Payment Date (together with interest on such outstanding Class A-3 Interest Carryover Shortfall at the Class A-3 Rate, to the extent lawful, calculated on the same basis as interest on the Class A-3 Notes for the same period), over (y) the amount of interest distributed to the Class A-3 Noteholders on such Payment Date. 5 "CLASS A-3 INTEREST DISTRIBUTABLE AMOUNT" means the amount of interest accrued during the related Interest Period (calculated on the basis of the actual number of days in such Interest Period and a year assumed to consist of 360 days) on the Class A-3 Principal Balance as of the immediately preceding Payment Date (after giving effect to payments of principal made on such immediately preceding Payment Date) at the Class A-3 Rate or, in the case of the first Payment Date, on the Class A-3 Initial Principal Balance. "CLASS A-3 NOTE" means any of the Floating Rate Asset Backed Notes, Class A-3, issued under the Indenture. "CLASS A-3 NOTEHOLDER" means any Person in whose name a Class A-3 Note is registered in the Note Register. "CLASS A-3 NOTIONAL BALANCE" means the Class A-3 Principal Balance as of the first day of the applicable Interest Period. "CLASS A-3 NOTIONAL FIXED RATE" means 5.018%. "CLASS A-3 PRINCIPAL BALANCE" as of any date means the Class A-3 Initial Principal Balance less all amounts paid to the holders of Class A-3 Notes in respect of principal pursuant to Section 5.06 hereof. "CLASS A-3 RATE" means, with respect to any Interest Period, one-month LIBOR plus 0.080%. "CLASS A-4 FINAL SCHEDULED PAYMENT DATE" means the Payment Date in October, 2007. "CLASS A-4 INITIAL PRINCIPAL BALANCE" means $175,000,000.00. "CLASS A-4 INTEREST CARRYOVER SHORTFALL" means, with respect to any Payment Date, the excess, if any, of (x) the Class A-4 Interest Distributable Amount for such Payment Date and any outstanding Class A-4 Interest Carryover Shortfall from the immediately preceding Payment Date (together with interest on such outstanding Class A-4 Interest Carryover Shortfall at the Class A-4 Rate, to the extent lawful, calculated on the same basis as interest on the Class A-4 Notes for the same period), over (y) the amount of interest distributed to the Class A-4 Noteholders on such Payment Date. "CLASS A-4 INTEREST DISTRIBUTABLE AMOUNT" means the amount of interest accrued during the related Interest Period (calculated on the basis of the actual number of days in such Interest Period and a year assumed to consist of 360 days) on the Class A-4 Principal Balance as of the immediately preceding Payment Date (after giving effect to payments of principal made on such immediately preceding Payment Date) at the Class A-4 Rate or, in the case of the first Payment Date, on the Class A-4 Initial Principal Balance. "CLASS A-4 NOTE" means any of the Floating Rate Asset Backed Notes, Class A-4, issued under the Indenture. 6 "CLASS A-4 NOTEHOLDER" means any Person in whose name a Class A-4 Note is registered in the Note Register. "CLASS A-4 NOTIONAL BALANCE" means the Class A-4 Principal Balance as of the first day of the applicable Interest Period. "CLASS A-4 NOTIONAL FIXED RATE" means 5.360%. "CLASS A-4 PRINCIPAL BALANCE" as of any date means the Class A-4 Initial Principal Balance less all amounts paid to the holders of Class A-4 Notes in respect of principal pursuant to Section 5.06 hereof. "CLASS A-4 RATE" means, with respect to any Interest Period, one-month LIBOR plus 0.100%. "CLEARING AGENCY" means an organization registered as a "clearing agency" pursuant to Section 17A of the Exchange Act. "CLEARING AGENCY PARTICIPANT" means a broker, dealer, bank, other financial institution or other Person for whom from time to time a Clearing Agency effects book-entry transfers and pledges of securities deposited with the Clearing Agency. "CLOSING DATE" means May 15, 2001. "CODE" means the Internal Revenue Code of 1986, as amended, and the Treasury Regulations promulgated thereunder. "COLLECTION ACCOUNT" means the account or accounts designated as such and established and maintained pursuant to Section 5.01. "COLLECTION PERIOD" means, with respect to any Payment Date, the calendar month immediately preceding the month in which such Payment Date occurs (and, in the case of the first Collection Period, the period from the Cutoff Date through the last day of the calendar month immediately preceding the month in which such Payment Date occurs). "COMMISSION" means the Securities and Exchange Commission, and any successor thereto. "CURRENT RECEIVABLE" means each Receivable that is not a Defaulted Receivable or a Liquidated Receivable. "CUTOFF DATE" means April 1, 2001. "DEALER" means the dealer of automobile and/or light duty trucks who sold a Financed Vehicle and who originated and assigned the Receivable relating to such Financed Vehicle to TMCC under an existing agreement between such dealer and TMCC. 7 "DEALER RECOURSE" means, with respect to a Receivable, all recourse rights against the Dealer which originated the Receivable, and any successor Dealer. "DEFAULTED RECEIVABLE" means a Receivable (other than an Administrative Receivable or a Warranty Receivable) as to which (i) all or any part of a Scheduled Payment is 150 or more days past due and the Servicer has not repossessed the related Financed Vehicle, or (ii) the Servicer has, in accordance with its customary servicing procedures, determined that eventual payment in full is unlikely and either repossessed and liquidated the related Financed Vehicle or repossessed and held the related Financed Vehicle in its repossession inventory for 90 days, whichever occurs first. "DEFINITIVE NOTES" shall have the meaning ascribed thereto in the Indenture. "DEFERRED PREPAYMENT" means, with respect to a Precomputed Receivable and a Collection Period, the aggregate amount, if any, of Payments Ahead remitted to the Servicer in respect of such Receivable during one or more prior Collection Periods and currently held by the Servicer or in the Payahead Account. "DELINQUENCY PERCENTAGE" means, with respect to a Collection Period, the percentage equivalent of a fraction, the numerator of which is the number of (i) all outstanding Receivables 61 days or more delinquent (after taking into account permitted extensions) as of the last day of such Collection Period (excluding Receivables as to which the Financed Vehicle has been liquidated during that Collection Period), determined in accordance with the Servicer's normal practices, plus (ii) all repossessed Financed Vehicles that have not been liquidated (to the extent the related Receivable is not otherwise reflected in clause (i) above), and the denominator of which is the aggregate number of Current Receivables on the last day of such Collection Period. "DEPOSITOR" means the Seller in its capacity as Depositor under the Trust Agreement. "DETERMINATION DATE" means, with respect to any Payment Date, the second Business Day preceding such Payment Date. "DTC" means The Depository Trust Company, and its successors. "ELIGIBLE DEPOSIT ACCOUNT" means either (a) a segregated account with an Eligible Institution or (b) a segregated trust account with the corporate trust department of a depository institution organized under the laws of the United States of America or any one of the states thereof or the District of Columbia (or any domestic branch of a foreign bank), having corporate trust powers and acting as trustee for funds deposited in such account, so long as any of the securities of such depository institution shall have a credit rating from each Rating Agency in one of its generic rating categories that signifies investment grade. "ELIGIBLE INSTITUTION" means (a) the corporate trust department of the Indenture Trustee or the Owner Trustee or (b) a depository institution organized under the laws of the United States of America or any one of the states thereof or the District of Columbia (or any domestic branch of a foreign bank), which (i) has either (A) a long-term unsecured debt rating of 8 "AA-" or better by Standard & Poor's and "Aa3" or better by Moody's or (B) an account or accounts in which funds will be held therein for 30 days or less which are maintained with a depository institution or trust company, the short-term unsecured debt obligations of which are rated "A-1+" or better by Standard & Poor's or if not rated by Standard & Poor's then otherwise approved by Standard & Poor's and rated "P-1" or better by Moody's, or if not rated by Moody's then otherwise approved by Moody's, and (ii) whose deposits are insured by the FDIC. If so qualified, the Indenture Trustee or the Owner Trustee may be considered an Eligible Institution for the purposes of clause (b) of this definition. "ELIGIBLE INVESTMENTS" means, at any time, any one or more of the following obligations and securities: (a) obligations of, and obligations fully guaranteed as to timely payment of principal and interest by, the United States or any agency thereof, provided such obligations are backed by the full faith and credit of the United States; (b) general obligations of or obligations guaranteed by FNMA, or (ii) any state of the United States, the District of Columbia or the Commonwealth of Puerto Rico then rated the highest available credit rating of each Rating Agency for such obligations; (c) certificates of deposit issued by any depository institution or trust company (including the Indenture Trustee) incorporated under the laws of the United States or of any state thereof, the District of Columbia or the Commonwealth of Puerto Rico and subject to supervision and examination by banking authorities of one or more of such jurisdictions, provided that the short-term unsecured debt obligations of such depository institution or trust company are then rated the highest available rating of each Rating Agency for such obligations; (d) certificates of deposit, demand or time deposits of, bankers' acceptances issued by, or federal funds sold by, any depository institution or trust company (including the Indenture Trustee) incorporated under the laws of the United States or any State and subject to supervision and examination by federal and/or State banking authorities and the deposits of which are fully insured by the Federal Deposit Insurance Corporation, so long as at the time of such investment or contractual commitment providing for such investment either such depository institution or trust company is an Eligible Institution (or if such investment will mature after more than one month, the long-term, unsecured debt of the issuer has the highest available rating from each Rating Agency) or as to which the Indenture Trustee shall have received a letter from each Rating Agency to the effect that such investment would not result in the qualification, downgrading or withdrawal of the ratings then assigned to any Notes issued by the Issuer; (e) certificates of deposit issued by any bank, trust company, savings bank or other savings institution that is an Eligible Institution and is fully insured by the FDIC (or if such investment will mature after more than one month, the long-term, unsecured debt of the issuer has the highest available rating from each Rating Agency); (f) repurchase obligations held by the Indenture Trustee that are acceptable to the Indenture Trustee with respect to any security described in clauses (a), (b) or (g) hereof or any other security issued or guaranteed by any other agency or instrumentality of the United States, 9 in either case entered into with a federal agency or a depository institution or trust company (acting as principal) described in clause (d) above (including the Indenture Trustee); PROVIDED, HOWEVER, that repurchase obligations entered into with any particular depository institution or trust company (including the Indenture Trustee) will not be Eligible Investments to the extent that the aggregate principal amount of such repurchase obligations with such depository institution or trust company held by the Indenture Trustee on behalf of the Noteholders or the Seller, as the case may be, shall exceed 10% of either the Pool Balance or of the principal balance of all the face amount of all Eligible Investments so held thereby; (g) securities bearing interest or sold at a discount issued by any corporation incorporated under the laws of the United States or any State so long as at the time of such investment or contractual commitment providing for such investment (i) the long-term, unsecured debt, or if such securities are commercial paper, the short-term unsecured debt, of such corporation has the highest available rating from each Rating Agency or (ii) the Indenture Trustee shall have received a letter from each Rating Agency to the effect that such investment would not result in the qualification, downgrading or withdrawal of the ratings then assigned to any of the Notes; (h) money market funds so long as such funds are rated "Aaa" by Moody's (so long as Moody's is a Rating Agency) and "AAAm" by Standard & Poor's (so long as Standard & Poor's is a Rating Agency), including any such fund for which the Indenture Trustee or an Affiliate thereof serves as an investment advisor, administrator, shareholder servicing agent and/or custodian or subcustodian, and notwithstanding that (i) such Person charges and collects fees and expenses from such funds for services rendered, (ii) such Person charges and collects fees and expenses for services rendered pursuant to the Trust Agreement, the Indenture or the Securities Account Control Agreement and (iii) services performed for such funds and pursuant to any such agreement may converge at any time. Each of the Seller and the Servicer hereby specifically authorizes the Indenture Trustee, Owner Trustee, Securities Intermediary or an Affiliate thereof to charge and collect all fees and expenses from such funds for services rendered to such funds, in addition to any fees and expenses such Person may charge and collect for services rendered pursuant to any such Agreement; and (i) such other investments acceptable to each Rating Agency (as approved in writing by each Rating Agency) as will not result in the qualification, downgrading or withdrawal of the ratings then assigned by such Rating Agency to any of the Notes; provided that each of the foregoing investments shall mature no later than the Payment Date next succeeding such investment, and shall be required to be held to such maturity. None of the foregoing will be considered a Eligible Investment if: (1) it constitutes a certificated security, bankers' acceptance, commercial paper, negotiable certificate of deposit or other obligation that constitutes "financial assets" within the meaning of Section 8-102(a)(9)(c) of the UCC unless a security entitlement with respect to such Eligible Investment has been created, in favor of the Indenture Trustee or Owner Trustee, as appropriate, in accordance with Section 8-501(b) of the UCC and the related securities intermediary has agreed not to comply 10 with entitlement orders of any secured party other than the Indenture Trustee, Seller or Owner Trustee, as the case may be; or (2) it constitutes a book-entry security held through the Federal Reserve System pursuant to federal book-entry regulations, unless, in accordance with applicable law, (A) a book-entry registration thereof is made to an appropriate book-entry account maintained with a Federal Reserve Bank by the Indenture Trustee, Securities Intermediary or Owner Trustee, as appropriate, or by a custodian therefor, (B) a deposit advice or other written confirmation of such book-entry registration is issued to such Person, (C) any such custodian makes entries in its books and records identifying that such book-entry security is held through the Federal Reserve System pursuant to federal book-entry regulations and belongs to such trustee and indicating that such custodian holds such Eligible Investment solely as agent for the Indenture Trustee, Securities Intermediary or Owner Trustee, as appropriate, (D) the Indenture Trustee, Securities Intermediary or Owner Trustee, as appropriate, makes entries in its books and records establishing that it holds such security solely in such capacity, and (E) any additional or alternative procedures as may hereafter become necessary to effect complete transfer of ownership thereof to such trustee are satisfied, consistent with changes in applicable law or regulations or the interpretation thereof. Notwithstanding anything to the contrary contained in this definition, no Eligible Investment may be purchased at a premium and no Eligible Investment shall be an "interest only" instrument. For purposes of this definition, any reference to the highest available credit rating of an obligation shall mean the highest available credit rating for such obligation (excluding any "+" signs associated with such rating), or such lower credit rating (as approved in writing by each Rating Agency) as will not result in the qualification, downgrading or withdrawal of the rating then assigned by such Rating Agency to any of the Notes. Also for purposes of this definition, any reference to a Rating Agency refers only to a Rating Agency that has, at the request of TMCC, rated the Notes. "ERISA" means the Employee Retirement Income Security Act of 1974, as amended. "EVENT OF DEFAULT" shall have the meaning specified in the Indenture. "EXCESS PAYMENT" means, with respect to a Receivable and a Collection Period, the amount, if any, by which the Actual Payment exceeds the sum of (i) the Scheduled Payment, and (ii) any Overdue Payment. "EXCHANGE ACT" means the Securities Exchange Act of 1934, as amended. "FDIC" means the Federal Deposit Insurance Corporation, and its successors. "FNMA" means the Federal National Mortgage Association, and its successors. 11 "FINANCED VEHICLE" means, with respect to a Receivable, the related automobile or light duty truck, as the case may be, together with all accessions thereto, securing the related Obligor's indebtedness under such Receivable. "HOLDER" or "SECURITYHOLDER" means the registered holder of a Note as evidenced by the Note Register or the Certificateholder, as the case may be, except that, solely for the purposes of giving certain consents, waivers, requests or demands pursuant to the Trust Agreement or the Indenture, the interest evidenced by the Certificate or any Note registered in the name of TAFR LLC or TMCC, or any Person actually known to a Trust Officer of the Owner Trustee or the Indenture Trustee to be controlling, controlled by or under common control with TAFR LLC or TMCC, shall not be taken into account in determining whether the requisite percentage necessary to effect any such consent, waiver, request or demand shall have been obtained. "INDENTURE" means the Indenture dated as of April 1, 2001, between the Issuer and the Indenture Trustee. "INDENTURE TRUSTEE" means the Person acting as Indenture Trustee under the Indenture, its successors in interest and any successor trustee under the Indenture. "INDEPENDENT MANAGER" means a director of the Seller who is not (i) a director, officer or employee of any Affiliate of the Seller, (ii) a natural person related to any director or officer of any Affiliate of the Seller, (iii) a holder (directly or indirectly) of more than 10% of any voting securities of any Affiliate of the Seller, or (iv) a natural person related to a holder (directly or indirectly) of more than 10% of any voting securities of any Affiliate of the Seller. "INSOLVENCY EVENT" means, with respect to a specified Person, (a) the filing of a decree or order for relief by a court having jurisdiction in the premises in respect of such Person or any substantial part of its property in an involuntary case under any applicable federal or state bankruptcy, insolvency or other similar law now or hereafter in effect, or appointing a receiver, liquidator, assignee, custodian, trustee, sequestrator or similar official for such Person or for any substantial part of its property, or ordering the winding-up or liquidation of such Person's affairs, and such decree or order shall remain unstayed and in effect for a period of 60 consecutive days; or (b) the commencement by such Person of a voluntary case under any applicable federal or state bankruptcy, insolvency or other similar law now or hereafter in effect, or the consent by such Person to the entry of an order for relief in an involuntary case under any such law, or the consent by such Person to the appointment of or taking possession by a receiver, liquidator, assignee, custodian, trustee, sequestrator or similar official for such Person or for any substantial part of its property, or the making by such Person of any general assignment for the benefit of creditors, or the failure by such Person generally to pay its debts as such debts become due, or the taking of action by such Person in furtherance of any of the foregoing. "INSURANCE POLICY" means, with respect to a Receivable, an insurance policy covering physical damage, credit life, credit disability, theft, mechanical breakdown or similar event relating to the related Financed Vehicle or Obligor. 12 "INTEREST DETERMINATION DATE" means the second London Banking Day prior to the Interest Reset Date for the related Interest Period. "INTEREST PERIOD" with respect to any Payment Date and (i) the Class A-1 Notes, Class A-2 Notes, Class A-3 Notes and the Class A-4 Notes, means the period from, and including, the preceding Payment Date (or, in the case of the initial Interest Period, from and including the Closing Date) to, but excluding, such Payment Date. "INTEREST RATE SWAP AGREEMENT" means 1992 ISDA Master Agreement dated as of May 15, 2001, including all schedules and confirmations thereto, between the Issuer and the Swap Counterparty, as the same may be amended, supplemented, renewed, extended or replaced from time to time. "INTEREST RESET DATE" means, with respect to the Class A-1 Notes, Class A-2 Notes, Class A-3 Notes and the Class A-4 Notes, the first day of the applicable Interest Period. "INVESTMENT COMPANY ACT" means the Investment Company Act of 1940, as amended. "ISSUER" means Toyota Auto Receivables 2001-B Owner Trust. "LIBOR" means the rate for deposits in U.S. dollars for a one-month period which appears on the Telerate Page 3750 as of 11:00 a.m., London time, on the Interest Determination Date; provided that, the following procedures will be followed if LIBOR cannot be determined as described above: (a) With respect to an Interest Determination Date on which no rate appears on Telerate Page 3750, LIBOR for the applicable Interest Determination Date will be the rate calculated by the Calculation Agent (as defined in the Interest Rate Swap Agreement) as the arithmetic mean of at least two quotations obtained by the Calculation Agent after requesting the principal London offices of each of four major reference banks in the London interbank market, which may include the Calculation Agent and its affiliates, as selected by the Calculation Agent, to provide the Calculation Agent with its offered quotation for deposits in U.S. dollars for a one-month period, commencing on the second London Banking Day immediately following the applicable Interest Determination Date, to prime banks in the London interbank market at approximately 11:00 a.m., London time, on such Interest Determination Date and in a principal amount that is representative for a single transaction in U.S. dollars in that market at that time. If at least two such quotations are provided, LIBOR determined on the applicable Interest Determination Date will be the arithmetic mean of the quotations. (b) If fewer than two quotations referred to in clause (a) above are provided, LIBOR determined on the applicable Interest Determination Date will be the rate calculated by the Calculation Agent as the arithmetic mean of the rates quoted at approximately 11:00 a.m. in New York on the applicable Interest Determination Date by three major banks, which may include the Calculation Agent and its affiliates, in New York, selected by the Calculation Agent for loans in U.S. dollars to leading European banks, having a maturity of one-month and in a principal amount that is representative for a single transaction in U.S. dollars in that market at that time. 13 (c) If the banks so selected by the Calculation Agent are not quoting as mentioned in clause (b) above, LIBOR for the applicable Interest Determination Date will be LIBOR in effect on the applicable Interest Determination Date. "LIEN" means any security interest, lien, charge, pledge, equity or encumbrance of any kind other than tax liens, mechanics' liens and any liens that attach to a Receivable or any property, as the context may require, by operation of law. "LIQUIDATED RECEIVABLE" means a Receivable that (i) has been the subject of a Prepayment in full, or (ii) has been paid in full or as to which the Servicer has determined that the final amounts in respect of such payment have been paid with respect to a Defaulted Receivable, regardless of whether all or any part of such payment has been made by the Obligor under such Receivable, the Seller pursuant to this Agreement, the Servicer pursuant to this Agreement or pursuant to the Receivables Purchase Agreement, an insurer pursuant to an Insurance Policy or otherwise. "LIQUIDATION EXPENSES" means, with respect to a Defaulted Receivable, the amount charged by the Servicer, in accordance with its customary servicing procedures, to or for its account for repossessing, refurbishing and disposing of the related Financed Vehicle and other out-of-pocket costs related to such liquidation. "LIQUIDATION PROCEEDS" means, with respect to a Defaulted Receivable, all amounts realized with respect to such Receivable from whatever sources (including, without limitation, proceeds of any Insurance Policy), net of amounts that are required by law or such Receivable to be refunded to the related Obligor. "LONDON BANKING DAY" means any day on which commercial banks in London are open for general business (including dealing in foreign exchange and foreign currency deposits). "MONTHLY REMITTANCE CONDITIONS" means, collectively, (i) TMCC is the Servicer, (ii) either (a) TMCC's short-term unsecured debt is rated P-1 by Moody's and A-1 by Standard & Poor's (so long as Moody's and Standard & Poor's are Rating Agencies), or (b) certain arrangements are made that are acceptable to the Rating Agencies and (iii) no Event of Default or Servicer Default shall have occurred and be continuing (unless waived by the appropriate Noteholders). "MOODY'S" means Moody's Investors Service, Inc., or its successor. "NET LIQUIDATION PROCEEDS" means, with respect to a Defaulted Receivable, Liquidation Proceeds less Liquidation Expenses. "NONRECOVERABLE ADVANCE" means any Outstanding Advance as to which the Servicer determines that any recovery from payments made on or with respect to such Receivable is unlikely; provided that the Servicer cannot deem any Outstanding Advance made at the option of the Servicer pursuant to Section 4.02 to be a Nonrecoverable Advance unless it delivers to the Indenture Trustee and Owner Trustee an Officer's Certificate to the effect that such Outstanding Advance, when made, was reasonably likely to be reimbursed from collections 14 in respect of interest on the related Receivable representing interest accrued on such Receivable at the related APR less the Servicing Fee Rate. "NOTE" means a Class A-1 Note, a Class A-2 Note, a Class A-3 Note or a Class A-4 Note. "NOTE DEPOSITORY AGREEMENT" has the meaning assigned in the Indenture. "NOTEHOLDER" means any Holder of a Note. "NOTE OWNER" has the meaning assigned in the Indenture. "NOTE POOL FACTOR" means, with respect to each Class of Notes as of the close of business on any Payment Date, a seven-digit decimal figure equal to the outstanding principal balance of such Class of Notes (after giving effect to any reductions thereof to be made on such Payment Date) divided by the original outstanding principal balance of such Class of Notes. The Note Pool Factor for each Class of Notes will be 1.0000000 as of the Closing Date; thereafter, the related Note Pool Factor will decline to reflect reductions in the outstanding principal balance of such Class of Notes. "NOTE REGISTER" means the register maintained by the Indenture Trustee pursuant to the Indenture recording the name of each registered Holder of a Note. "OBLIGOR" on a Receivable means the purchaser or co-purchasers of the related Financed Vehicle purchased in part or in whole by the execution and delivery of such Receivable or any other Person who owes or may be liable for payments under such Receivable. "OFFICER'S CERTIFICATE" means a certificate signed by the President, any Vice President, the chief financial officer, the chief accounting officer, the Treasurer or any Assistant Treasurer, or the Secretary or any Assistant Secretary of the Issuer, the Seller or the Servicer, as the case may be. "OPINION OF COUNSEL" means one or more written opinions of counsel who may, except as otherwise provided herein, be an employee of or counsel to the Issuer, the Seller or the Servicer, which counsel shall be acceptable to the Indenture Trustee, the Owner Trustee or the Rating Agencies, as the case may be. "OPTIONAL PURCHASE PRICE" means an amount equal to the aggregate Administrative Purchase Payments for the Receivables (including Receivables that became Defaulted Receivables in the Collection Period preceding the Payment Date on which that purchase is effected), plus the appraised value of any other property held by the Trust, such value to be determined by an appraiser mutually agreed upon by the Servicer, the Owner Trustee and the Indenture Trustee, and shall succeed to all interests in and to the Trust (less liquidated expenses); PROVIDED, HOWEVER, that the Optional Purchase Price shall be equal to or greater than the Outstanding Amount plus all accrued and unpaid interest on each Class of Notes (including, without duplication, any Class A-1 Interest Carryover Shortfall, Class A-2 Interest Carryover Shortfall, Class A-3 Interest Carryover Shortfall or Class A-4 Interest Carryover Shortfall) through the Payment Date on which the Owner Trust Estate is to be purchased by the Servicer, or 15 successor to the Servicer plus any amounts payable by the Issuer to the Swap Counterparty under the Interest Rate Swap Agreement. "OPTIONAL PURCHASE PERCENTAGE" means 10%. "OUTSTANDING ADVANCES" means, with respect to a Receivable and the last day of a Collection Period, the sum of all Advances made as of or prior to such date, minus all payments or collections as of or prior to such date which are specified in Section 5.04(b) as applied to reimburse all unpaid Advances with respect to such Receivable. "OUTSTANDING AMOUNT" means the aggregate principal amount of all Notes, or, if indicated by the context, all Notes of any Class, outstanding at the date of determination. "OVERDUE PAYMENT" means, with respect to any Receivable (other than an Administrative Receivable or a Warranty Receivable), payments made by or on behalf of the Obligor which are not Supplemental Servicing Fees and therefor shall be applied first to reimburse the Servicer for Outstanding Advances made with respect to such Receivable pursuant to Section 5.03(a). "OWNER TRUST ESTATE" means all right, title and interest of the Trust in and to the property and rights assigned to the Trust pursuant to Article II of this Agreement, all funds on deposit from time to time in the accounts created pursuant to Section 5.01 of this Agreement (excluding any net investment income with respect to amounts held in such accounts) and all other property of the Trust from time to time, including any rights of the Owner Trustee and the Trust pursuant to this Agreement and the Administration Agreement, and as assignee of the rights and interests of the Depositor under the Receivables Purchase Agreement. "OWNER TRUSTEE" means the Person acting as Owner Trustee under the Trust Agreement, its successors in interest and any successor owner trustee under the Trust Agreement. "PAYAHEAD ACCOUNT" means the account or accounts designated as such and established and maintained pursuant to Section 5.01. "PAYMENT AHEAD" means, with respect to a Precomputed Receivable and a Collection Period, any Excess Payment not representing prepayment in full of such Precomputed Receivable which the Servicer, in accordance with its customary servicing practices, will apply towards the payment of Scheduled Payments in one or more future Collection Periods. "PAYMENT DATE" means, with respect to a Collection Period, the fifteenth calendar day of the following calendar month, or if such day is not a Business Day, the next succeeding Business Day, commencing June 15, 2001. "PERSON" means any legal person, including any individual, corporation, partnership, limited liability company, joint venture, association, joint stock company, trust, unincorporated organization or government or any agency or political subdivision thereof. 16 "POOL BALANCE" means, as of any date, the aggregate Principal Balance of the Receivables (exclusive of all Administrative Receivables for which the Servicer has paid the Administrative Purchase Payment, Warranty Receivables for which the Seller has paid the Warranty Purchase Payment and Defaulted Receivables) as of the close of business on such date. "POOL FACTOR" as of any Payment Date, means a seven-digit decimal figure equal to the Pool Balance as of such Payment Date divided by the Original Pool Balance. "PRECOMPUTED ADVANCE" means an advance in respect of principal or interest on a Precomputed Receivable in the amount determined as set forth in Section 5.04(a). "PRECOMPUTED RECEIVABLE" means any Actuarial Receivable or Rule of 78s Receivable. "PREPAYMENT" means (i) with respect to any Precomputed Receivable and any Collection Period, any prepayment in full or Excess Payment which the Servicer, in accordance with its customary servicing practices, will apply towards the payment of Scheduled Payments due during or prior to such Collection Period or (ii) with respect to any Simple Interest Receivable, any prepayment, whether in part or in full, in respect of such Simple Interest Receivable. "PRINCIPAL BALANCE" means, with respect to any Receivable as of any date, the Amount Financed minus the sum of the following amounts: (i) in the case of a Precomputed Receivable, that portion of all Scheduled Payments due on or prior to such date allocable to principal, computed in accordance with the actuarial method, (ii) in the case of a Simple Interest Receivable, that portion of all Scheduled Payments actually received on or prior to such date allocable to principal, (iii) any Warranty Purchase Payment or Administrative Purchase Payment with respect to such Receivable allocable to principal, and (iv) any Prepayments or other payments applied to reduce the unpaid principal balance of such Receivable. The Principal Balance of a Defaulted Receivable is zero. "PRINCIPAL DISTRIBUTION ACCOUNT" means the administrative subaccount established within the Collection Account by the Indenture Trustee pursuant to the Indenture and the Trust Agreement. "PRINCIPAL DISTRIBUTION AMOUNT" means, with respect to any Payment Date, an amount equal to the excess, if any, of (a) the Pool Balance as of the end of the Collection Period preceding the related Collection Period, or, as of the Cutoff Date, in the case of the first Collection Period, over (b) the Pool Balance as of the end of the related Collection Period together with any portion of the Principal Distribution Amount that would have been required to be deposited into the Principal Distribution Account on any prior Payment Date had there been sufficient funds available to make such deposit; provided, however, that the Principal Distribution Amount shall not exceed the outstanding principal amount of all the Notes on such Payment Date (prior to giving effect to any principal payments made on such Payment Date), together with any portion of the Principal Distribution Amount that was to be deposited into the Principal Distribution Account on any prior Payment Date but was not because sufficient funds were not available to make the deposit; and provided, further, that (i) the Principal Distribution Amount on the Class A-1 Final Scheduled Payment Date shall not be less than the amount that is necessary to reduce the outstanding principal amount of the Class A-1 Notes to zero; (ii) the Principal Distribution Amount on the Class A-2 Final Scheduled Payment Date shall not be less than the amount that is necessary to reduce the outstanding principal amount of the Class A-2 Notes to zero; (iii), the Principal Distribution 17 Amount on the Class A-3 Final Scheduled Payment Date shall not be less than the amount that is necessary to reduce the outstanding principal amount of the Class A-3 Notes to zero; and (iv) the Principal Distribution Amount on the Class A-4 Final Scheduled Payment Date shall not be less than the amount that is necessary to reduce the outstanding principal amount of the Class A-4 Notes to zero. "RATING AGENCY" means either or each of Moody's and Standard & Poor's, as indicated by the context. "REBATE" means, with respect to a Precomputed Receivable and any date, the rebate, calculated on an actuarial basis, under such Precomputed Receivable that is or would be payable to the related Obligor for unearned finance charges or any other charges subject to rebate if such Obligor were to prepay such Receivable in full on such date. "RECEIVABLE" means any retail installment sale contract executed by an Obligor in respect of a Financed Vehicle, and all proceeds thereof and payments thereunder, which Receivable shall be identified in the Schedule of Receivables. "RECEIVABLE FILE" means the documents specified in Section 2.02 pertaining to a particular Receivable. "RECEIVABLES PURCHASE AGREEMENT" means that certain Receivables Purchase Agreement, dated as of April 1, 2001, between the Seller and TMCC. "RECORD DATE" means, with respect to the Notes of any Class and each Payment Date, the calendar day immediately preceding such Payment Date or, if Definitive Notes representing any Class of Notes have been issued, the last day of the month immediately preceding the month in which such Payment Date occurs. Any amount stated "as of a Record Date" or "on a Record Date" shall give effect to (i) all applications of collections, and (ii) all payments and distributions to any party under this Agreement, the Indenture and the Trust Agreement or to the related Obligor, as the case may be, in each case as determined as of the opening of business on the related Record Date. "RECOVERIES" means, with respect to any Receivable that becomes a Liquidated Receivable, monies collected in respect thereof, from whatever source, during any Collection Period following the Collection Period in which such Receivable became a Liquidated Receivable, net of the sum of any amounts expended by the Servicer for the account of the Obligor and any amounts required by law to be remitted to the Obligor. "RELEASED ADMINISTRATIVE AMOUNT" means, with respect to a Payment Date and to an Administrative Receivable, the Deferred Prepayment, if any, for such Administrative Receivable. 18 "RELEASED WARRANTY AMOUNT" means, with respect to a Payment Date and to a Warranty Receivable, the Deferred Prepayment, if any, for such Warranty Receivable. "RELEVANT TRUSTEE" means (i) with respect to the control over or appropriate designation denoting ownership or control over any property comprising a portion of the Owner Trust Estate (as defined in the Trust Agreement) that either is not conveyed or pledged to the Indenture Trustee for the benefit of the Noteholders and Certificateholder pursuant to the Granting Clause of the Indenture or that has been released from the lien of the Indenture, the Owner Trustee, and (ii) with respect to any property comprising a portion of the Trust Estate (as defined in the Indenture) that has not been released from the lien of the Indenture, the Indenture Trustee; PROVIDED, HOWEVER, that with respect to any property that is under the joint or separate control of a co-trustee or separate trustee under the Trust Agreement or the Indenture, respectively, "Relevant Trustee" shall refer to either or both of the Owner Trustee and such co-trustee or separate trustee or to either or both of the Indenture Trustee and such co-trustee or separate trustee, as the case may be. "RESERVE ACCOUNT" means the account designated as such, established and maintained pursuant to Section 5.07. "RESERVE ACCOUNT INITIAL DEPOSIT" means $3,744,458. "RULE OF 78s RECEIVABLE" means any Receivable which provides for the allocation of payments according to the "sum of periodic balances" or "sum of monthly payments" method. "SCHEDULE OF RECEIVABLES" means the schedule of receivables attached as Schedule A to this Agreement, as it may be amended from time to time. "SCHEDULED PAYMENT" means, with respect to any Payment Date and to a Receivable, the payment set forth in such Receivable as due from the Obligor in the related Collection Period; provided, however, that in the case of the first Collection Period, the Scheduled Payment shall include all such payments due from the Obligor on or after the Cutoff Date. "SECURITIES ACCOUNT CONTROL AGREEMENT" means the Securities Account Control Agreement dated April 1, 2001, among the Seller, Wells Fargo Bank Minnesota, National Association, as Securities Intermediary thereunder, and Wells Fargo Bank Minnesota, National Association, as Indenture Trustee, pursuant to which the Reserve Fund will be established and maintained. "SECURITIES ACT" means the Securities Act of 1933, as amended. "SECURITYHOLDER" see the definition of "Holder." "SELLER" means TAFR LLC, and its successors in interest to the extent permitted hereunder. "SERVICER" means TMCC, as the servicer of the Receivables, and each successor to TMCC (in the same capacity) pursuant to Section 7.03 or 8.02. 19 "SERVICER'S CERTIFICATE" means an Officer's Certificate of the Servicer delivered pursuant to Section 4.10, substantially in the form attached hereto as Exhibit A. "SERVICER DEFAULT" means an event specified in Section 8.01. "SERVICING FEE RATE" means 1.00% per annum. "SIMPLE INTEREST ADVANCE" means an advance in respect of interest on any Simple Interest Receivable in the amount determined as set forth in Section 5.04(a). "SIMPLE INTEREST METHOD" means the method of allocating a fixed level payment to principal and interest, pursuant to which the portion of such payment that is allocated to interest is equal to the product of the fixed rate of interest multiplied by the unpaid principal balance multiplied by the period of time elapsed since the preceding payment of interest was made and the remainder of such payment is allocable to principal. "SIMPLE INTEREST RECEIVABLE" means any Receivable which provides for the allocation of payments according to the simple interest method. "SPECIFIED RESERVE ACCOUNT BALANCE" means with respect to any Payment Date, an amount equal to the greater of 0.75% of the outstanding Principal Balance of the Receivables as of the end of the related Collection Period or (b) $7,488,915 (0.50% of the outstanding Principal Balance of the Receivables as of the Cutoff Date); provided however, that if, on any Payment Date (x) the average of the Charge-off Rates for the three preceding Collection Periods exceeds 1.25% or (y) the average of the Delinquency Percentages for the three preceding Collection Periods exceeds 1.25%, the Specified Reserve Account Balance will be the greatest of (a) 0.75% of the outstanding Principal Balance of the Receivables as of the end of the related Collection Period (b) $7,488,915 (0.50% of the outstanding principal balance of the Receivables as of the Cutoff Date) and (c) 5.50% of the Class A Note Balance as of such Payment Date (after giving effect to any principal payments made on the Notes on such Payment Date); provided further, that the Specified Reserve Balance with respect to any date shall not exceed the sum of the Class A Note Balance as of the preceding Payment Date (after giving effect to any principal payments made on the Notes on such preceding Payment Date). "STANDARD & POOR'S" means Standard & Poor's Ratings Services, a Division of the McGraw-Hill Companies, and its successors. "SUCCESSOR SERVICER" means any entity appointed as a successor to the Servicer pursuant to Section 8.02. "SUPPLEMENTAL SERVICING FEE" means, with respect to any Payment Date, all late fees, prepayment charges, extension fees and other administrative fees and expenses or similar charges allowed by applicable law with respect to the Receivables received by the Servicer during the related Collection Period. "SWAP COUNTERPARTY" shall mean Toyota Motor Credit Corporation, as swap counterparty under the Interest Rate Swap Agreement, or any successor or replacement swap counterparty from time to time under the Interest Rate Swap Agreement. 20 "SWAP EVENT OF DEFAULT" means (i) the failure of the Issuer or the Swap Counterparty to pay any amount when due under the Interest Rate Swap Agreement after giving effect to any applicable grace period; (ii) the occurrence of certain events of insolvency or bankruptcy of the Issuer or the Swap Counterparty as specified in the Interest Rate Swap Agreement and (iii) certain other standard events of default under the 1992 ISDA Master Agreement as specified in the Interest Rate Swap Agreement including "Breach of Agreement" (not applicable to the Issuer), "Misrepresentation" (not applicable to the Issuer) and "Merger without Assumption," as described in Sections 5(a)(ii), 5(a)(iv) and 5(a)(viii) of the 1992 ISDA Master Agreement. "SWAP PAYMENTS INCOMING" means on any Payment Date the net amount, if any, then payable by a Swap Counterparty to the Issuer, excluding any Swap Termination Payments. "SWAP PAYMENTS OUTGOING" means on any Payment Date the net amount, if any, then payable by the Issuer to the Swap Counterparty, excluding any Swap Termination Payments. "SWAP TERMINATION EVENT" means (i) certain events of insolvency of bankruptcy of the Issuer or the Swap Counterparty as specified in the Interest Rate Swap Agreement; (ii) any Event of Default under the Indenture that results in the acceleration of the Notes or involving an uncured payment default; (iii) the Issuer or Swap Counterparty becomes subject to registration as an "investment company" under the Investment Company Act of 1940; and (iv) certain standard termination events under the 1992 ISDA Master Agreement as specified in the Interest Rate Swap Agreement including "Illegality," "Tax Event" and "Tax Event Upon Merger," each as more fully described in Sections 5(b)(i), 5(b)(ii) and 5(b)(iii) of the 1992 ISDA Master Agreement. "SWAP TERMINATION PAYMENT" means any termination payment payable by the Issuer to the Swap Counterparty or by the Swap Counterparty to the Issuer under the Interest Rate Swap Agreement. "TAFR LLC" means Toyota Auto Finance Receivables LLC, a Delaware limited liability company, or its successors. "TMCC" means Toyota Motor Credit Corporation, a California corporation, and its successors and assigns. "TOTAL SERVICING FEE" means the sum of the Basic Servicing Fee and the Supplemental Servicing Fee. "TRUST" means the Issuer. "TRUST AGREEMENT" means the Amended and Restated Trust Agreement, dated as of April 1, 2001, by and among the Seller and the Owner Trustee. "TRUST ESTATE" means all money, instruments, rights and other property that are subject or intended to be subject to the lien and security interest of this Indenture for the benefit of the Noteholders (including, without limitation, all property and interests granted to the 21 Indenture Trustee pursuant to the granting clause of the Indenture), including all proceeds thereof. "TRUST OFFICER" means, in the case of the Indenture Trustee, any officer within the Corporate Trust Office of the Indenture Trustee, including any Vice President, Assistant Vice President, Secretary, Assistant Secretary or any other officer of the Indenture Trustee customarily performing functions similar to those performed by any of the above designated officers and also, with respect to a particular matter, any other officer to whom such matter is referred because of such officer's knowledge of and familiarity with the particular subject and, with respect to the Owner Trustee, any officer in the Corporate Trust Administration Department of the Owner Trustee with direct responsibility for the administration of the Trust Agreement and the Basic Documents on behalf of the Owner Trustee. "UCC" means the Uniform Commercial Code as in effect in the relevant jurisdiction. "UNITED STATES" means the United States of America. "WARRANTY PURCHASE PAYMENT" means, with respect to a Payment Date and to (1) a Warranty Receivable which is a Precomputed Receivable repurchased by the Seller as of the close of business on the last day of the related Collection Period, (a) the sum of (i) all Scheduled Payments on such Receivable due after the last day of such Collection Period, (ii) all past due Scheduled Payments for which an Advance has not been made, (iii) an amount equal to any reimbursement of Outstanding Advances made pursuant to Section 5.04(b) with respect to such Receivable and (iv) an amount equal to all other Outstanding Advances made pursuant to Section 5.04(c) with respect to such Receivable, minus (b) the sum of (i) the Rebate, if any, paid to the Obligor on a Precomputed Receivable on or before the date of such purchase (except to the extent specified in Section 4.03) and (ii) any other proceeds in respect of such Receivable received during any Collection Period prior to or during such Collection Period (to the extent applied to reduce the Principal Balance of such Receivable on such Payment Date), and (2) a Warranty Receivable which is a Simple Interest Receivable repurchased by the Seller as of the close of business on the last day of the related Collection Period, the sum of (a) the unpaid principal balance owed by the Obligor in respect of such Receivable plus (b) interest on such unpaid principal balance at a rate equal to the related APR to the last day in the related Collection Period. "WARRANTY RECEIVABLE" means a Receivable which the Seller is required to repurchase pursuant to Section 4.08. SECTION 1.02 USAGE OF TERMS. With respect to all terms in this Agreement, the singular includes the plural and the plural the singular; words importing any gender include the other genders; references to "writing" include printing, typing, lithography and other means of reproducing words in a visible form; references to agreements and other contractual instruments include all subsequent amendments thereto or changes therein entered into in accordance with their respective terms and not prohibited by this Agreement; references to Persons include their permitted successors and assigns; and the term "including" means "including without limitation." 22 ARTICLE II CONVEYANCE OF RECEIVABLES SECTION 2.01 CONVEYANCE OF RECEIVABLES. (a) Upon the execution of this Agreement by the parties hereto, the Seller, pursuant to the mutually agreed upon terms contained in this Agreement, shall sell, transfer, assign and otherwise convey to the Owner Trustee on behalf of the Issuer, without recourse (but subject to the Seller's obligations in this Agreement), all of its right, title and interest in and to the Receivables and any proceeds related thereto, including any Dealer Recourse and such other items as shall be specified in this Agreement. Concurrently therewith and in exchange therefor, the Issuer shall deliver to, or to the order of, the Seller the Notes and the Certificate. (b) In consideration of the foregoing and other good and valuable consideration to be delivered to the Seller hereunder, on behalf of the Issuer, the Seller does hereby sell, transfer, assign and otherwise convey to the Owner Trustee on behalf of the Issuer, in trust for the benefit of the Certificateholder, without recourse (subject to the Seller's obligations herein): (i) all right, title and interest of the Seller in and to the Receivables and all monies due thereon or paid thereunder or in respect thereof (including proceeds of the repurchase of Receivables by the Seller pursuant to Section 3.02 or the purchase of Receivables by the Servicer pursuant to Section 4.08 or 9.01) on or after the Cutoff Date; (ii) the interest of the Seller in the security interests in the Financed Vehicles granted by the Obligors pursuant to the Receivables and any accessions thereto; (iii) the interest of the Seller in any proceeds of any physical damage insurance policies covering Financed Vehicles and in any proceeds of any credit life or credit disability insurance policies relating to the Receivables or the Obligors; (iv) the interest of the Seller in any Dealer Recourse; (v) the right of the Seller to realize upon any property (including the right to receive future Liquidation Proceeds) that shall have secured a Receivable and have been repossessed pursuant to the terms thereof; (vi) the rights and interests of the Seller under the Receivables Purchase Agreement; (vii) all other assets comprising the Owner Trust Estate; and (viii) all proceeds of the foregoing. (c) It is the intention of the Seller that the transfer and assignment contemplated by this Agreement shall constitute a sale of the Receivables from the Seller to the Issuer and the beneficial interest in and title to the Receivables shall not be part of the Seller's estate in the event of the filing of a bankruptcy petition by or against the Seller under any bankruptcy law. The Seller agrees to execute and file all filings (including filings under the UCC) necessary in 23 any jurisdiction to provide third parties with notice of the sale of the Receivables pursuant to this Agreement and to perfect such sale under the UCC. (d) Although the parties hereto intend that the transfer and assignment contemplated by this Agreement be a sale, in the event such transfer and assignment is deemed to be other than a sale, the parties intend that all filings described in the foregoing paragraph shall give the Owner Trustee on behalf of the Issuer a first priority perfected security interest in, to and under the Receivables, and other property conveyed hereunder and all proceeds of any of the foregoing. This Agreement shall be deemed to be the grant of a security interest from the Seller to the Owner Trustee on behalf of the Issuer, and the Owner Trustee on behalf of the Issuer shall have all the rights, powers and privileges of a secured party under the UCC. (e) In connection with the foregoing conveyance, the Servicer shall maintain its computer system so that, from and after the time of sale of the Receivables to the Owner Trustee on behalf of the Issuer under this Agreement, the Servicer's master computer records (including any back-up archives) that refer to any Receivable indicate clearly the interest of the Issuer in such Receivable and that the Receivable is owned by the Issuer and controlled by the Owner Trustee on behalf of the Issuer. Indication of the Issuer's ownership of a Receivable shall be deleted from or modified on the Servicer's computer systems when, and only when, the Receivable has been paid in full, repurchased or assigned pursuant to this Agreement. (f) Ownership and control of the Receivables, as between the Issuer, the Owner Trustee and the Indenture Trustee (on behalf of the Noteholders and Certificateholder) shall be governed by the Indenture. SECTION 2.02 CUSTODY OF RECEIVABLES FILES. To assure uniform quality in servicing the Receivables and to reduce administrative costs, the Owner Trustee on behalf of the Issuer, upon the execution and delivery of this Agreement, appoints the Servicer, and the Servicer accepts such appointment, to act as the agent of the Issuer as custodian of the following documents or instruments (the parties hereto expressly acknowledging and agreeing that the Servicer may appoint a third party to act as the agent of the Servicer to maintain possession of such documents or instruments as contemplated by Sections 3.01(v) and 3.03(b) of this Agreement) which are hereby constructively delivered to the Owner Trustee with respect to each Receivable: (a) the fully executed original of the Receivable; (b) documents evidencing or related to any Insurance Policy; (c) the original credit application of each Obligor, fully executed by such Obligor on TMCC's customary form, or on a form approved by TMCC, for such application; (d) the original certificate of title (or evidence that such certificate of title has been applied for) or such documents that the Servicer shall keep on file, in accordance with TMCC's customary procedures, evidencing the security interest in the related Financed Vehicle; and 24 (e) any and all other documents that the Seller or the Servicer, as the case may be, shall keep on file, in accordance with its customary procedures, relating to such Receivable or the related Obligor or Financed Vehicle. SECTION 2.03 ACCEPTANCE BY OWNER TRUSTEE. The Owner Trustee hereby acknowledges its acceptance, on behalf of the Issuer, pursuant to this Agreement, of all right, title and interest in and to the Receivables conveyed by the Seller pursuant to this Agreement and declares and shall declare from and after the date hereof that the Owner Trustee holds and shall hold such right, title and interest, upon the terms and conditions set forth in this Agreement. ARTICLE III THE RECEIVABLES SECTION 3.01 REPRESENTATIONS AND WARRANTIES OF THE SELLER WITH RESPECT TO THE RECEIVABLES. The Seller makes the following representations and warranties as to the Receivables on which the Issuer is deemed to have relied in acquiring the Receivables. Such representations and warranties speak as of the execution and delivery of this Agreement and as of the Closing Date, but shall survive the sale, transfer and assignment of the Receivables to the Issuer, and the pledge thereof to the Indenture Trustee pursuant to the Indenture. (a) CHARACTERISTICS OF RECEIVABLES. Each Receivable (i) shall have been originated in the United States by a Dealer for the retail sale of the related Financed Vehicle in the ordinary course of such Dealer's business, shall have been fully and properly executed by the parties thereto, shall have been purchased by TMCC from such Dealer under an existing agreement with TMCC and shall have been validly assigned by such Dealer to TMCC in accordance with the terms of such agreement and shall have been subsequently sold by TMCC to the Seller pursuant to the Receivables Purchase Agreement, (ii) shall have created or shall create a valid, subsisting and enforceable first priority security interest in favor of TMCC in the related Financed Vehicle, which security interest has been assigned by TMCC to the Seller and shall be assignable, and shall be so assigned, by the Seller to the Owner Trustee on behalf of the Issuer hereby, (iii) shall, except as otherwise provided in this Agreement, provide for monthly payments that fully amortize the Amount Financed by maturity (except for minimally different payments in the first or last month in the life of the Receivable) and provide for a finance charge or yield interest at its APR, in either case calculated based on the Rule of 78s, the simple interest method or the actuarial method, (iv) shall contain customary and enforceable provisions, such that the rights and remedies of the holder thereof shall be adequate for realization against the collateral of the benefits of the security and (v) shall provide for, in the event that such Receivable is prepaid, a prepayment that fully pays the Principal Balance and includes accrued but unpaid interest. (b) SCHEDULE OF RECEIVABLES. The information set forth in the Schedule of Receivables shall be true and correct in all material respects as of the opening of business on the Cutoff Date, and no selection procedures adverse to the Securityholders shall have been utilized in selecting the Receivables from those automobile and light duty truck 25 receivables of TMCC which met the selection criteria set forth in this Section and this Agreement. (c) COMPLIANCE WITH LAW. To the knowledge of the Seller, each Receivable and each sale of the related Financed Vehicle shall have complied at the time it was originated or made, and shall comply at the time of execution of this Agreement, in all material respects with all requirements of applicable federal, state and local laws, and regulations thereunder, including usury laws, the Federal Truth-in-Lending Act, the Equal Credit Opportunity Act, the Fair Credit Billing Act, the Fair Credit Reporting Act, the Fair Debt Collection Practices Act, the Federal Trade Commission Act, the Magnuson-Moss Warranty Act, Federal Reserve Board Regulations B, M and Z (to the extent applicable), state adaptations of the National Consumer Act and of the Uniform Consumer Credit Code and other consumer credit, equal credit opportunity and disclosure laws, except with respect to applicable Florida documentary stamp taxes as to which the effect of noncompliance will not have a material adverse effect on such Receivable. (d) BINDING OBLIGATION. Each Receivable shall constitute the legal, valid and binding payment obligation in writing of the related Obligor, enforceable by the holder thereof in accordance with its terms, except as enforceability may be limited by bankruptcy, insolvency, reorganization, moratorium and other similar laws affecting the enforcement of creditors' rights in general and by general principles of equity, regardless of whether such enforceability shall be considered in a proceeding in equity or at law. (e) NO BANKRUPT OBLIGORS. None of the Receivables shall be due, to the best knowledge of the Seller, from any Obligor who is presently the subject of a bankruptcy proceeding or is bankrupt or is insolvent. (f) NO GOVERNMENT OBLIGORS. None of the Receivables shall be due from the United States or any state, or from any agency, department or instrumentality of the United States or any state or local government. (g) EMPLOYEE OBLIGORS. None of the Receivables shall be due from any employee of the Seller, TMCC or any of their respective Affiliates. (h) SECURITY INTEREST IN FINANCED VEHICLES. Immediately prior to the sale, assignment and transfer thereof, each Receivable shall be secured by a validly perfected first priority security interest in the related Financed Vehicle in favor of TMCC as secured party or all necessary and appropriate action with respect to such Receivable shall have been taken to perfect a first priority security interest in such Financed Vehicle in favor of TMCC as secured party. (i) RECEIVABLES IN FORCE. No Receivable shall have been satisfied, subordinated or rescinded, nor shall any Financed Vehicle have been released in whole or in part from the lien granted by the related Receivable. (j) NO WAIVERS. No provision of a Receivable shall have been waived in such a manner that such Receivable fails to meet all of the other representations and warranties made by the Seller herein with respect thereto. 26 (k) NO AMENDMENTS. No Receivable shall have been amended or modified in such a manner that the total number of Scheduled Payments has been increased or that the related Amount Financed has been increased or that such Receivable fails to meet all of the other representations and warranties made by the Seller herein with respect thereto. (l) NO DEFENSES. No facts shall be known to the Seller which would give rise to any right of rescission, setoff, counterclaim or defense, nor shall the same have been asserted or threatened, with respect to any Receivable. (m) NO LIENS. To the knowledge of the Seller, no liens or claims shall have been filed as of the date of this Agreement, including liens for work, labor or materials relating to a Financed Vehicle, that shall be liens prior to, or equal or coordinate with, the security interest in such Financed Vehicle granted by the related Receivable, which Liens shall not have been released or satisfied as of the Closing Date. (n) NO DEFAULT; NO REPOSSESSION. Except for payment defaults that, as of the Cutoff Date, have been continuing for a period of not more than 30 days, no default, breach, violation or event permitting acceleration under the terms of any Receivable shall have occurred as of the Cutoff Date; no continuing condition that with notice or the lapse of time would constitute a default, breach, violation or event permitting acceleration under the terms of any Receivable shall have arisen; the Seller shall not have waived any of the foregoing; and no Financed Vehicle has been repossessed without reinstatement as of the Cutoff Date. (o) INSURANCE. The terms of each Receivable require the Obligor to obtain and maintain physical damage insurance covering the related Financed Vehicle in accordance with TMCC's normal requirements. The terms of each Receivable allow, but do not require TMCC to (and TMCC, in accordance with its current normal servicing procedures, does not) obtain any such coverage on behalf of the Obligor. (p) GOOD TITLE. It is the intention of the Seller that the transfer and assignment herein contemplated, taken as a whole, constitute a sale of the Receivables from the Seller to the Issuer and that the beneficial interest in and title to the Receivables not be part of the debtor's estate in the event of the filing of a bankruptcy petition by or against the Seller under any bankruptcy law. No Receivable has been sold, transferred, assigned or pledged by the Seller to any Person other than the Issuer, and no provision of a Receivable shall have been waived, except for a waiver that would not violate clause (j) above; immediately prior to the transfer and assignment herein contemplated, the Seller had good and marketable title to each Receivable free and clear of all Liens and rights of others; immediately upon the transfer and assignment thereof, the Issuer shall have good and marketable title to each Receivable, free and clear of all Liens and rights of others; and the transfer and assignment herein contemplated has been perfected under the UCC. (q) LAWFUL ASSIGNMENT. No Receivable shall have been originated in, or shall be subject to the laws of, any jurisdiction under which the sale, transfer and assignment of such Receivable under this Agreement or pursuant to a transfer of the related certificate of title shall be unlawful, void or voidable. 27 (r) ALL FILINGS MADE. As of the Closing Date, all filings (including UCC filings) necessary in any jurisdiction to provide third parties with notice of the transfer and assignment herein contemplated, to perfect the sale of the Receivables from the Seller to the Owner Trustee and to give the Owner Trustee on behalf of the Issuer a first priority perfected security interest in the Receivables shall have been made. (s) ONE ORIGINAL. There shall be only one original executed copy of each Receivable. (t) CHATTEL PAPER. Each Receivable constitutes "chattel paper" as defined in the UCC. (i) ADDITIONAL REPRESENTATIONS AND WARRANTIES. (i) Each Receivable shall have an original number of Scheduled Payments of not less than 12 nor more than 72 and, as of the Cutoff Date, a remaining number of Scheduled Payments of not less than 5 nor more than 72; (ii) each Receivable provides for the payment of a finance charge based on an APR ranging from 6% to 15%; (iii) each Receivable shall have had an original principal balance of not less than $811 and not more than $80,617 and, as of the Cutoff Date, an unpaid principal balance of not less than $401 nor more than $49,988; (iv) no Receivable was originated under a special financing program; (v) no Receivable shall have a Scheduled Payment that is more than 30 days past due as of the Cutoff Date; (vi) no Financed Vehicle was subject to force-placed insurance as of the Cutoff Date; (vii) there is no Receivable as to which payments ahead of more than 6 Scheduled Payments have been received from or on behalf of the related Obligor; and (viii) each Receivable is being serviced by Toyota Motor Credit Corporation. (u) LOCATION OF RECEIVABLE FILES. Each Receivable File shall be kept at one of the locations listed in the Schedule of Receivables or at such other office as shall be specified to the Owner Trustee and the Indenture Trustee as provided in Section 3.03(b). SECTION 3.02 REPURCHASE UPON BREACH. The Seller, the Servicer or the Owner Trustee, as the case may be, shall inform the other parties to this Agreement and the Indenture Trustee promptly, in writing, upon the discovery of any breach of the Seller's representations and warranties made pursuant to Section 3.01 or 6.01 that materially and adversely affects the interests of the Issuer in any Receivable. As of the last day of the second Collection Period following the Collection Period in which it discovers or receives notice of such breach (or, at the Seller's election, the last day of the first Collection Period following the Collection Period in which it discovers or receives notice of such breach), the Seller shall, unless such breach shall have been cured in all material respects, repurchase such Receivable and, if necessary, the Seller shall enforce the obligation of TMCC under the Receivables Purchase Agreement to repurchase such Receivable from the Seller. Notwithstanding the foregoing, the obligation of the Seller to repurchase a Receivable shall not be conditioned on the performance by TMCC of its obligation to repurchase such Receivable from the Seller pursuant to the Receivables Purchase Agreement. This repurchase obligation shall obtain for all representations and warranties of the Seller contained in this Agreement whether or not the Seller has knowledge of the breach at the time of the breach or at the time the representations and warranties were made. In consideration of the repurchase of any such Receivable, on the Business Day immediately preceding the related 28 Payment Date, the Seller shall remit the Warranty Purchase Payment of such Receivable to the Collection Account in the manner specified in Section 5.05 and shall be entitled to receive the Released Warranty Amount. The sole remedy of the Owner Trustee, the Issuer, the Indenture Trustee (by operation of the assignment of the Owner Trustee's rights hereunder pursuant to the Indenture) or any Securityholder with respect to a breach of the Seller's representations and warranties pursuant to this Agreement shall be to require the Seller to repurchase the related Receivable pursuant to this Section and to enforce TMCC's obligation to the Seller to repurchase such Receivables pursuant to the Receivables Purchase Agreement. The Owner Trustee shall have no duty to conduct any affirmative investigation as to the occurrence of any condition requiring the repurchase of any Receivable pursuant to this Section. In connection with such repurchase, the Owner Trustee and Indenture Trustee shall take all steps necessary to effect a transfer of such Receivable as set forth in Section 9.01(d). SECTION 3.03 DUTIES OF SERVICER AS CUSTODIAN. (a) SAFEKEEPING. The Servicer shall hold the Receivable Files as custodian for the benefit of the Issuer and maintain such accurate and complete accounts, records and computer systems pertaining to each Receivable File as shall enable the Issuer to comply with this Agreement. In performing its duties as custodian the Servicer shall act with reasonable care, using that degree of skill and attention that the Servicer exercises with respect to the receivable files relating to comparable automotive receivables that the Servicer services for itself or others. The Servicer shall promptly report to the Issuer and the Indenture Trustee any failure on its part to hold the Receivable Files and maintain its accounts, records and computer systems as herein provided and shall promptly take appropriate action to remedy any such failure. Nothing herein shall be deemed to require an initial review or any periodic review by the Issuer, the Owner Trustee or the Indenture Trustee of the Receivable Files. (b) MAINTENANCE OF AND ACCESS TO RECORDS. The Servicer shall maintain each Receivable File at one of its offices specified in Schedule B or at such other office of the Servicer or a third party agent retained by the Servicer as shall be specified to the Issuer and the Indenture Trustee by written notice not later than 90 days after any change in location. The Servicer shall make available to the Issuer, the Swap Counterparty and the Indenture Trustee or their respective duly authorized representatives, attorneys or auditors a list of locations of the Receivable Files and the related accounts, records and computer systems maintained by the Servicer at such times during normal business hours as the Issuer or the Indenture Trustee shall instruct with reasonable advance notice. (c) RELEASE OF DOCUMENTS. Upon instruction from the Indenture Trustee, the Servicer shall release any Receivable File to the Indenture Trustee, the Indenture Trustee's agent or the Indenture Trustee's designee, as the case may be, at such place or places as the Indenture Trustee may designate, as soon as practicable. SECTION 3.04 INSTRUCTIONS; AUTHORITY TO ACT. The Servicer shall be deemed to have received proper instructions with respect to the Receivable Files upon its receipt of written instructions signed by a Trust Officer of the Owner Trustee or the Indenture Trustee. A certified copy of a bylaw or of a resolution of the board of directors of the Owner Trustee or of the Indenture Trustee shall constitute conclusive evidence of the authority of such Trust Officer to 29 act, and shall be considered conclusive evidence of the authority of such Trust Officer to act until receipt by the Servicer of written notice to the contrary given by the Owner Trustee or Indenture Trustee, as the case may be. SECTION 3.05 CUSTODIAN'S INDEMNIFICATION. The Servicer as custodian shall indemnify the Issuer, the Owner Trustee and the Indenture Trustee and each of their respective officers, directors, employees and agents for any and all liabilities, obligations, losses, compensatory damages, payments, costs or expenses of any kind whatsoever that may be imposed on, incurred by or asserted against any of them as the result of any improper act or omission in any way relating to the maintenance and custody by the Servicer as custodian of the Receivable Files; PROVIDED, HOWEVER, that the Servicer shall not be liable to the Owner Trustee for any portion of any such amount resulting from the willful misfeasance, bad faith or negligence of the Owner Trustee or Indenture Trustee and the Servicer shall not be liable to the Indenture Trustee for any portion of any such amount resulting from the willful misfeasance, bad faith or negligence of the Indenture Trustee or Owner Trustee. SECTION 3.06 EFFECTIVE PERIOD AND TERMINATION. The Servicer's appointment as custodian shall become effective as of the date hereof, and shall continue in full force and effect until terminated pursuant to this Section. If TMCC shall resign as Servicer in accordance with the provisions of this Agreement or if all of the rights and obligations of any Servicer shall have been terminated under Section 8.01, the appointment of TMCC (as Servicer) as custodian shall be terminated hereunder without further action by the Indenture Trustee, Owner Trustee, Noteholders or the Certificateholder. The Indenture Trustee or, with the consent of the Indenture Trustee, the Owner Trustee may terminate the Servicer's appointment as custodian, with cause, at any time upon written notification to the Servicer, and without cause upon 30 days' prior written notification to the Servicer. The Owner Trustee, Indenture Trustee or Noteholders may terminate the Servicer as custodian hereunder in the same manner as the Owner Trustee, Indenture Trustee or Noteholders may terminate the rights and obligations of the Servicer under Section 8.01. As soon as practicable after any termination of such appointment, the Servicer shall deliver the Receivable Files to the Relevant Trustee or the agent thereof at such place or places as the Relevant Trustee may reasonably designate. ARTICLE IV ADMINISTRATION AND SERVICING OF RECEIVABLES SECTION 4.01 DUTIES OF SERVICER. The Servicer, for the benefit of the Issuer and the Securityholders (to the extent provided herein), shall manage, service, administer and make collections on the Receivables with reasonable care, using that degree of skill and attention that the Servicer exercises with respect to comparable automotive receivables that it services for itself or others. The Servicer's duties shall include collection and posting of all payments, responding to inquiries of Obligors or by federal, state or local government authorities with respect to the Receivables, investigating delinquencies, sending payment information to Obligors, reporting tax information to Obligors in accordance with its customary practices, accounting for collections, furnishing monthly and annual statements to the Owner Trustee and the Indenture Trustee with respect to payments and distributions and making Advances and performing the other duties 30 specified herein. The Servicer shall follow its customary standards, policies and procedures as in effect from time to time 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. Nothing in the foregoing or in any other section of this Agreement shall be construed to prevent the Servicer from implementing new programs, whether on an intermediate, pilot or permanent basis, or on a regional or nationwide basis, or from modifying its standards, policies and procedures as long as, in each case, the Servicer does or would implement such programs or modify its standards, policies and procedures in respect of comparable assets serviced for itself in the ordinary course of business. Without limiting the generality of the foregoing, the Servicer is authorized and empowered to execute and deliver, on behalf of itself, the Issuer, the Owner Trustee, the Indenture Trustee, the Securityholders or any of them, any and all instruments of satisfaction or cancellation, or partial or full release or discharge, and all other comparable instruments, with respect to such Receivables and the Financed Vehicles. The Servicer is hereby authorized to communicate with Obligors in the ordinary course of its servicing of the Receivables and Financed Vehicles in its own name. The Servicer is hereby authorized to commence, in its own name or in the name of the Issuer, a legal proceeding to enforce a Defaulted Receivable or to commence or participate in a legal proceeding (including without limitation a bankruptcy proceeding) relating to or involving a Receivable, including a Defaulted Receivable. If the Servicer shall commence or participate in a legal proceeding to enforce a Receivable, the Issuer shall thereupon be deemed to have automatically assigned to the Servicer, solely for the purpose of collection on behalf of the party retaining an interest in such Receivable, such Receivable and the other property conveyed to the Issuer hereby with respect to such Receivable for purposes of commencing or participating in any such proceeding as a party or claimant, and the Servicer is authorized and empowered by the Owner Trustee 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. If in any enforcement suit or legal proceeding it shall be held that the Servicer may not enforce a Receivable on the ground that it shall not be a real party in interest or a holder entitled to enforce such Receivable, the Owner Trustee on behalf of the Issuer shall, at the Servicer's expense and direction, take steps to enforce such Receivable, including bringing suit in its name or the name of the Owner Trustee, the Indenture Trustee, the Certificateholder and/or the Noteholders. The Owner Trustee shall furnish the Servicer with any powers of attorney and other documents 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. SECTION 4.02 COLLECTION AND ALLOCATION OF RECEIVABLE PAYMENTS. The Servicer shall make reasonable efforts to collect all payments called for under the terms and provisions of the Receivables as and when the same shall become due and shall follow such customary collection procedures as it follows with respect to comparable automotive receivables that it services for itself or others. The Servicer shall be authorized to grant extensions, rebates or adjustments on a Receivable in accordance with the customary servicing standards of the Servicer without the prior consent of the Owner Trustee, Indenture Trustee or any Securityholder; provided, however, that if, as a result of any change in the related APR or the Amount Financed, any increase in the total number of Scheduled Payments or any extension of payments such that the Receivable will be outstanding later than the Class A-4 Final Scheduled Payment Date, the amount of any 31 Scheduled Payment due in a subsequent Collection Period is reduced, the Servicer shall be obligated to either repurchase such Receivable pursuant to Section 4.08 or to make an Advance in respect of such Receivable in each subsequent Collection Period equal to the amount by which such Scheduled Payment has been reduced. In addition, in the event that any such rescheduling or extension of a Receivable modifies the terms of such Receivable in such a manner as to release the security interest in the related Financed Vehicle or constitute a cancellation of such Receivable and the creation of a new automobile or light duty truck receivable, the Servicer shall purchase such Receivable pursuant to Section 4.08, and the receivable created shall not be included as an asset of the Issuer. The Servicer may, in accordance with its customary servicing procedures, waive any prepayment charge, late payment charge or any other fees that may be collected in the ordinary course of servicing the Receivables. SECTION 4.03 REBATES ON FULL PREPAYMENTS. In the event that the amount of a full Prepayment by an Obligor under a Precomputed Receivable, after adjustment for the applicable Rebate, is less than the amount that would be payable under the actuarial method if a full Prepayment were made at the end of the billing month under such Precomputed Receivable, either because the Rebate calculated under the terms of such Precomputed Receivable is greater than the amount calculable under the actuarial method or because the Servicer's customary servicing procedure is to credit a greater Rebate, the Servicer, as part of its servicing duties, shall remit such difference by deposit into the Collection Account pursuant to Section 5.05. SECTION 4.04 REALIZATION UPON RECEIVABLES. On behalf of the Issuer, the Servicer shall use its best efforts, consistent with its customary servicing procedures, to repossess or otherwise comparably convert the ownership of any Financed Vehicle that it has reasonably determined should be repossessed or otherwise converted following a default under the Receivable secured by the Financed Vehicle (and shall specify such Receivables to the Relevant Trustee no later than the Determination Date following the end of the Collection Period in which the Servicer shall have made such determination). The Servicer shall follow such practices and procedures as it shall deem necessary or advisable and as shall be customary and usual in its servicing of automobile and light duty truck receivables, which practices and procedures may include reasonable efforts to realize upon any Dealer Recourse, selling the related Financed Vehicle at public or private sale and other actions to realize upon such a Receivable. The Servicer shall be entitled to recover its Liquidation Expenses with respect to each Defaulted Receivable. All Net Liquidation Proceeds realized in connection with any such action with respect to a Receivable shall be deposited by the Servicer in the Collection Account in the manner specified in Section 5.02. The foregoing is subject to the proviso 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 Liquidation Proceeds of the related Receivable by an amount greater than the amount of such expenses. SECTION 4.05 PHYSICAL DAMAGE INSURANCE. The Servicer shall, in accordance with its customary servicing procedures, require that each Obligor shall have delivered proof that it has obtained physical damage insurance covering the related Financed Vehicle at the date of origination of the related Receivable, but shall not obtain any such coverage on behalf of any Obligor. The Servicer shall be required to monitor the maintenance by any Obligor of such 32 insurance only to the same extent, if any, that the Servicer monitors such maintenance by obligors with respect to retail automobile sales contracts that are held for the account of TMCC. SECTION 4.06 MAINTENANCE OF SECURITY INTERESTS IN FINANCED VEHICLES. The Servicer shall, in accordance with its customary servicing procedures and at its own expense, take such steps as are necessary to maintain perfection of the security interest created by each Receivable in the related Financed Vehicle. The Issuer hereby authorizes the Servicer to take such steps as are necessary to again perfect such security interest on behalf of the Issuer and the Indenture Trustee in the event of the relocation of a Financed Vehicle or for any other reason. In the event that the assignment of a Receivable to the Issuer is insufficient, without a notation on the related Financed Vehicle's certificate of title, to grant to the Issuer a first priority perfected security interest in the related Financed Vehicle, the Servicer hereby agrees to serve as the agent of the Issuer for the purpose of perfecting the security interest of the Issuer in such Financed Vehicle and agrees that the Servicer's listing as the secured party on the certificate of title is in this capacity as agent of the Issuer. SECTION 4.07 COVENANTS OF SERVICER. The Servicer hereby makes the following covenants to the Issuer on which the Issuer has relied in purchasing the Receivables and issuing the Certificate, and on which the Indenture Trustee will rely in undertaking the trusts set forth in the Indenture and issuing the Notes. (a) LIENS IN FORCE. Except as contemplated by this Agreement, the Servicer shall not release in whole or in part any Financed Vehicle from the security interest securing the related Receivable. (b) NO IMPAIRMENT. The Servicer shall do nothing to impair the rights of the Securityholders in the Receivables. (c) NO AMENDMENTS. Except as provided in Section 4.02, the Servicer shall not amend or otherwise modify any Receivable such that the total number of Scheduled Payments, the Amount Financed or the APR is altered, or extend the maturity of such Receivable beyond the Class A-4 Final Scheduled Payment Date. SECTION 4.08 PURCHASE OF RECEIVABLES UPON BREACH. The Servicer shall inform the Owner Trustee and Indenture Trustee promptly, in writing, upon the actual knowledge of one of its officers of, and the Owner Trustee shall inform the Servicer and the Indenture Trustee promptly, in writing, upon the actual knowledge of one of its Trust Officers of, any breach pursuant to Section 4.06 or 4.07 that materially and adversely affects the interests of the Issuer in a Receivable, or if an extension, rescheduling or modification of a Receivable is made by the Servicer as described in Section 4.02 and the Servicer does not elect to make Advances to cover resulting reductions in interest accruals as provided in Section 4.02, the party discovering such event shall give prompt written notice to the others. As of the last day of the second Collection Period following the Collection Period in which it discovers or receives notice of such event (or, at the Servicer's election, the last day of the first Collection Period following the Collection Period in which it discovers or receives notice of such breach), the Servicer shall, unless such event shall have been cured in all material respects or such modification has been rescinded or the Servicer has elected to and does make all required Advances, purchase from the Issuer such 33 Receivable. In consideration of the purchase of any such Receivable, on the Business Day immediately preceding the related Payment Date the Servicer shall remit the Administrative Purchase Payment to the Collection Account in the manner specified in Section 5.05, and shall be entitled to receive the Released Administrative Amount. Upon such deposit of the Administrative Purchase Payment, the Servicer shall for all purposes of this Agreement be deemed to have released all claims for reimbursement of Outstanding Advances made in respect of such Receivable. Except as otherwise provided in Section 7.02, the sole remedy of the Owner Trustee, the Issuer, the Indenture Trustee or any Securityholders against the Servicer with respect to a breach pursuant to Section 4.02, 4.06 or 4.07 shall be to require the Servicer to purchase the related Receivables pursuant to this Section. The Owner Trustee shall have no duty to conduct any affirmative investigation as to the occurrence of any condition requiring the repurchase of any Receivable pursuant to this Section. In connection with such repurchase, the Owner Trustee and Indenture Trustee shall take all steps necessary to effect a transfer of such Receivable to the Servicer as set forth in Section 9.01(d). SECTION 4.09 SERVICING FEE AND EXPENSES. As compensation for the performance of its obligations hereunder, the Servicer shall be entitled to receive on each Payment Date, out of Available Collections, the Total Servicing Fee. The Basic Servicing Fee in respect of a Collection Period shall be calculated based on a 360 day year comprised of twelve 30-day months. Except to the extent otherwise provided herein, the Servicer shall be required to pay all expenses incurred by it in connection with its activities under this Agreement (including fees and disbursements of the Owner Trustee, the Indenture Trustee, the Administrator and the independent accountants, taxes imposed on the Servicer, expenses incurred by the Servicer in connection with its preparation of reports hereunder and all other fees and expenses not expressly stated under this Agreement to be for the account of the Certificateholder). SECTION 4.10 SERVICER'S CERTIFICATE. On or before each Determination Date, the Servicer shall deliver to the Owner Trustee, each Paying Agent, the Swap Counterparty (unless TMCC or an Affiliate thereof is the Servicer and the Swap Counterparty at the time of delivery), the Indenture Trustee and the Seller, with a copy to each Rating Agency, a Servicer's Certificate substantially in the form of Exhibit A hereto, containing the information necessary to make the payments to be made on the related Payment Date and the information necessary for the Owner Trustee and the Indenture Trustee to send statements to the Securityholders pursuant to the Trust Agreement or Indenture, as the case may be. The Servicer shall also specify therein the identity of any Receivable that the Servicer or the Seller became obligated to repurchase or that the Servicer has determined to be a Defaulted Receivable during the related Collection Period. Receivables purchased or to be purchased by the Servicer or the Seller and Receivables that the Servicer has determined during such Collection Period to be Defaulted Receivables and with respect to which payment of the Administrative Purchase Payment or Warranty Purchase Payment has been provided from whatever source as of last day of such Collection Period shall be identified by the related Obligor's account number (as specified in the Schedule of Receivables). SECTION 4.11 ANNUAL STATEMENT AS TO COMPLIANCE; NOTICE OF DEFAULT. (a) Within 120 days after March 31 of each calendar year (commencing with the fiscal year ended March 31, 2002), the Servicer shall deliver an Officer's Certificate to the Owner Trustee, the Swap Counterparty (unless TMCC or an Affiliate thereof is the Servicer and the Swap Counterparty at 34 the time of delivery) and the Indenture Trustee to the effect that a review of the activities of the Servicer during the prior fiscal year (or since the Closing Date in the case of the first such Officer's Certificate) has been made under the supervision of the officer executing such Officer's Certificate with a view to determining whether during such period the Servicer has performed and observed all of its obligations under this Agreement, and either (i) stating that, to the best of his or her knowledge, no default by the Servicer under this Agreement has occurred and is continuing, or (ii) if such a default has occurred and is continuing, specifying such default and the nature and status thereof. (b) The Servicer shall deliver to the Owner Trustee, the Indenture Trustee, the Swap Counterparty (unless TMCC or an Affiliate thereof is the Servicer and the Swap Counterparty at the time of delivery) and the Rating Agencies, promptly after having obtained knowledge thereof, but in no event later than five 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 Default under Section 8.01(a) or (b). SECTION 4.12 ANNUAL ACCOUNTANTS' REPORT. Within 120 days after March 31 of each fiscal year for the Servicer (commencing with the year ended March 31, 2002), the Servicer shall deliver to the Owner Trustee and the Indenture Trustee a report prepared by the Independent Accountants of the Servicer concerning their review of the activities of the Servicer during the preceding 12-month period ended March 31 (or other applicable period in the case of the first such report or letter) to the effect that such accountants have reviewed certain records and documents relating to the servicing of the Receivables under this Agreement (using procedures specified in such report or letter) and as a result of such review, and in connection with such procedures, they are reporting such exceptions, if any, as shall be set forth therein. Such report or letter shall also indicate that the firm is independent with respect to the Seller and the Servicer within the meaning of the Code of Professional Ethics of the American Institute of Certified Public Accountants. In the event such Independent Accountants require the Owner Trustee or Indenture Trustee to agree to the procedures performed by such firm, the Servicer shall direct the Owner Trustee or Indenture Trustee in writing to so agree; it being understood and agreed that the Owner Trustee or Indenture Trustee will deliver such letter of agreement in conclusive reliance upon the direction of the Servicer, and the Owner Trustee and Indenture Trustee need make no independent inquiry or investigation as to, and shall have no obligation or liability in respect of, the sufficiency, validity or correctness of such procedures. SECTION 4.13 ACCESS TO CERTAIN DOCUMENTATION AND INFORMATION REGARDING RECEIVABLES. The Servicer shall provide to the Swap Counterparty, the Owner Trustee and Indenture Trustee reasonable access to the documentation regarding the Receivables as provided in Section 3.03(b). The Servicer will provide such access to any Securityholder only in such cases where the Certificateholder or Noteholders shall be required by applicable statutes or regulations to review such documentation. In each case, such access shall be afforded without charge, but only upon reasonable request and during the normal business hours at the respective offices of the Servicer. Nothing in this Section shall derogate from the obligation of the Servicer to observe any applicable law prohibiting disclosure of information regarding the Obligors and 35 the failure of the Servicer to provide access to information as a result of such obligation shall not constitute a breach of this Section. SECTION 4.14 APPOINTMENT OF SUBSERVICER. The Servicer may at any time appoint a subservicer to perform all or any portion of its obligations as Servicer hereunder if each Rating Agency has received reasonable advance notice of the Servicer's intention to do so and has not notified the Servicer that such an appointment would or might result in the qualification, reduction or withdrawal of a rating then assigned by such rating Agency to any Class of Notes; PROVIDED, HOWEVER, that the Servicer shall remain obligated and be liable to the Issuer, the Owner Trustee, the Indenture Trustee, the Swap Counterparty, the Certificateholder and the Noteholders for the servicing and administering of the Receivables in accordance with the provisions hereof without diminution of such obligation and liability by virtue of the appointment of such subservicer and to the same extent and under the same terms and conditions as if the Servicer alone were servicing and administering the Receivables. The fees and expenses of the subservicer shall be as agreed between the Servicer and its subservicer from time to time, and none of the Issuer, the Owner Trustee, the Indenture Trustee, the Swap Counterparty, the Certificateholder or the Noteholders shall have any responsibility therefor. SECTION 4.15 AMENDMENTS TO SCHEDULE OF RECEIVABLES. If the Servicer, during a Collection Period, assigns to a Receivable an account number that differs from the original account number identifying such Receivable on the Schedule of Receivables, the Servicer shall deliver to the Issuer, the Owner Trustee and the Indenture Trustee, on or before the Payment Date relating to such Collection Period, an amendment to the Schedule of Receivables reporting the newly assigned account number, together with the old account number of each such Receivable. The first such delivery of amendments to the Schedule of Receivables shall include monthly amendments reporting account numbers appearing on the Schedule of Receivables with the new account numbers assigned to such Receivables during any prior Collection Period. SECTION 4.16 REPORTS TO SECURITYHOLDERS AND RATING AGENCIES. The Owner Trustee shall send a copy of each Officer's Certificate delivered pursuant to Section 4.11 and each report of independent accountants delivered pursuant to Section 4.12 to the Rating Agencies within five days of its receipt thereof from the Servicer or accountants. A copy of any such Officer's Certificate or accountants report may be obtained by any Certificateholder, Noteholder or Note Owner by a request in writing to the Owner Trustee addressed as set forth in Section 10.03 hereof. Upon the telephone request of the Owner Trustee, the Indenture Trustee will promptly furnish the Owner Trustee a list of Noteholders as of the date specified by the Owner Trustee. ARTICLE V ACCOUNTS; PAYMENTS AND DISTRIBUTIONS; STATEMENTS to SECURITYHOLDERS SECTION 5.01 ESTABLISHMENT OF COLLECTION ACCOUNT AND PAYAHEAD ACCOUNT. (a) The Servicer on behalf of the Owner Trustee and the Indenture Trustee, shall establish the Collection Account and Payahead Account in the name of the Indenture Trustee for the benefit of the Securityholders. Except as otherwise provided in this Agreement, each such 36 account shall be an account initially established with the Indenture Trustee and maintained with the Indenture Trustee so long as (i) the commercial paper or other short-term unsecured debt obligations of the Indenture Trustee are rated "P-1" or better by Moody's, or if not so rated by Moody's then otherwise approved by Moody's, and "A-1+" or better by Standard & Poor's if rated by Standard & Poor's, or if not so rated by Standard & Poor's then otherwise approved by Standard & Poor's, in each case at the time of any deposit therein, or (ii) such account is a segregated trust account located in the corporate trust department of the Indenture Trustee bearing a designation clearly indicating that the funds deposited therein (other than interest or investment earnings thereon) are held in trust for the benefit of the Securityholders, and the Indenture Trustee has a long-term deposit rating from Moody's (so long as Moody's is a Rating Agency) of at least "A1" (or such lower rating as Moody's shall approve in writing) and corporate trust powers under applicable federal and state laws and is organized under the laws of the United States or any state thereof, the District of Columbia or the Commonwealth of Puerto Rico. Except as otherwise provided in this Agreement, in the event that the Indenture Trustee no longer meets either of the foregoing requirements, then the Servicer shall, with the Indenture Trustee's assistance as necessary, cause the Collection Account and Payahead Account to be moved to a bank or trust company that satisfies either of such requirements. (b) For so long as the depository institution or trust company then maintaining the Collection Account and Payahead Account meets the requirements of Section 5.01(a)(i) or (a)(ii), all amounts held in these accounts shall, to the extent permitted by applicable laws, rules and regulations, be invested, as directed in writing by the Servicer, in Eligible Investments; otherwise such amounts shall be maintained in cash. Earnings on investment of funds in these accounts (net of losses and investment expenses) shall be paid to the Servicer on each Payment Date as servicing compensation, and any losses and investment expenses shall be charged against the funds on deposit in the related account. (c) For so long as Wells Fargo Bank Minnesota, National Association is the Relevant Trustee, the Collection Account and Payahead Account shall be maintained with Wells Fargo Bank Minnesota, National Association as described in clause (ii) of the second sentence of Section 5.01(a). In the event that the long-term debt rating of the Relevant Trustee does not satisfy clause (ii) of the second sentence of Section 5.01(a), the Servicer shall, with the assistance of the Relevant Trustee as necessary, cause the Collection Account and the Payahead Account to be moved to an institution or an account otherwise satisfying the requirements of Section 5.01(a). (d) Subject to the foregoing, the Servicer, on behalf of the Owner Trustee and the Indenture Trustee, shall establish and maintain as the Collection Account an Eligible Deposit Account in the name of and under the exclusive control of the Indenture Trustee, bearing a designation clearly indicating that the funds deposited therein are held for the benefit of the Noteholders and the Certificateholder. On the Closing Date, the Owner Trustee will transfer, or cause to be transferred, to such Collection Account all funds or investments on deposit in the Collection Account established pursuant to the Trust Agreement for the benefit of the Certificateholder, and all of the proceeds thereof, and will transfer all of its right, title and interest in the Collection Account, all funds or investments held or to be held therein and all proceeds thereof, whether or not on behalf of the Certificateholder, to the Indenture Trustee for the benefit of the Swap Counterparty, the Noteholders and Certificateholder. The Indenture Trustee will be obligated to transfer all amounts remaining on deposit in the Collection Account 37 on the Payment Date on which the Notes of all Classes have been paid in full and the Interest Rate Swap Agreement has been terminated and all Swap Payments Outgoing and all Swap Termination Payments payable to the Swap Counterparty have been paid (or substantially all of the Trust Estate is otherwise released from the lien of the Indenture) to the Collection Account established pursuant to the Trust Agreement for the benefit of the Certificateholder, and to take all necessary or appropriate actions to transfer all of its right, title and interest in the Collection Account, all funds or investments held or to be held therein and all proceeds thereof, whether or not on behalf of the Swap Counterparty or the Noteholders and the Certificateholder, to the Owner Trustee for the benefit of the Certificateholder, subject to the limitations set forth in the Indenture with respect to amounts held for payment to the Swap Counterparty or to Noteholders that do not promptly deliver a Note for payment on such Payment Date. (e) With respect to the Collection Account and all property held therein, the Owner Trustee agrees, by its acceptance hereof that, on the terms and conditions set forth in the Indenture, for so long as Notes of any Class or the Interest Rate Swap Agreement remain outstanding, the Indenture Trustee shall possess all right, title and interest therein (excluding interest or investment income thereon payable to the Servicer), and that such account shall be under the sole dominion and control of the Indenture Trustee for the benefit of the Swap Counterparty and the Noteholders and the Certificateholder, as the case may be, as set forth in the Indenture. Subject to the right of the Indenture Trustee to make withdrawals therefrom, as directed by the Servicer, for the purposes and in the amounts set forth in Section 5.06, the Payahead Account and all funds held therein shall be the property of the Servicer and not the property of the Issuer, the Owner Trustee or the Indenture Trustee. The Issuer, Owner Trustee, Seller and Indenture Trustee will treat the Payahead Account, all funds therein and all net investment income with respect thereto as assets of the Servicer for federal income tax and all other purposes. The parties hereto agree that the Servicer shall have the power, revocable by the Indenture Trustee or by the Owner Trustee with the consent of the Indenture Trustee, to instruct the Indenture Trustee to make withdrawals and payments from the Collection Account and the Payahead Account for the purpose of permitting the Servicer, Indenture Trustee or the Owner Trustee to carry out its respective duties hereunder or under the Indenture or the Trust Agreement, as the case may be. SECTION 5.02 COLLECTIONS. (a) Except as otherwise provided in this Agreement, the Servicer shall remit daily to the Collection Account all payments received by or on behalf of the Obligors on or in respect of the Receivables (other than, in the case of Precomputed Receivables, payments constituting Payments Ahead) and all Net Liquidation Proceeds within two Business Days after receipt thereof. Notwithstanding the foregoing, for so long as the Monthly Remittance Conditions are satisfied, the Servicer shall not be required to remit such collections to the Collection Account on the foregoing daily basis but shall be entitled to retain such collections, without segregation from its other funds, until the Business Day before each Payment Date at which time the Servicer shall remit all such collections in respect of the related Collection Period to the Collection Account in immediately available funds. Commencing with the first day of the first Collection Period that begins at least two Business Days after the day on which any Monthly Remittance Condition ceases to be satisfied and for so long as any Monthly Remittance Condition is not satisfied, all collections then held by the Servicer shall be immediately deposited into the Collection Account and all future collections on or in respect of 38 the Receivables and all Net Liquidation Proceeds shall be remitted by the Servicer to the Collection Account on a daily basis within two Business Days after receipt thereof. (b) Except as otherwise provided in this Agreement, the Servicer shall deposit all Payments Ahead in the Collection Account within two Business Days after receipt thereof, which Payments Ahead shall be transferred to the Payahead Account pursuant to Section 5.06(a)(ii). Notwithstanding the foregoing, so long as all Monthly Remittance Conditions are satisfied, the Servicer will not be required to deposit Payments Ahead in the Payahead Account within two Business Days after receipt thereof but shall be entitled to retain such Payments Ahead, without segregation from its other funds, until such time as the Servicer shall be required to remit Applied Payments Ahead to the Collection Account pursuant to Section 5.06(a)(i). Commencing with the first day of the first Collection Period that begins at least two Business Days after the day on which any Monthly Remittance Condition ceases to be satisfied and for so long as all Monthly Remittance Conditions are not satisfied, all Payments Ahead then held by the Servicer shall be immediately deposited into the Payahead Account and all future Payments Ahead shall be remitted by the Servicer to the Payahead Account within two Business Days after receipt thereof. (c) The Servicer shall give the Owner Trustee, the Indenture Trustee and each Rating Agency written notice of the failure of any Monthly Remittance Condition (and any subsequent curing of a failed Monthly Remittance Condition) as soon as practical after the occurrence thereof. Notwithstanding the failure of any Monthly Remittance Condition, the Servicer may utilize an alternative collection or Payment Ahead remittance schedule (which may be the remittance schedule previously utilized prior to the failure of such Monthly Remittance Condition), if the Servicer provides to the Owner Trustee and Indenture Trustee written confirmation from each Rating Agency that such alternative remittance schedule will not result in the qualification, reduction or withdrawal of the rating then assigned to any Class of Notes. SECTION 5.03 APPLICATION OF COLLECTIONS. As of the Business Day immediately preceding the related Payment Date, all collections for the related Collection Period shall be applied by the Servicer as follows: (a) With respect to each Receivable (other than an Administrative Receivable or a Warranty Receivable), payments made by or on behalf of the Obligor which are not Supplemental Servicing Fees shall be applied first to reimburse the Servicer for Outstanding Advances made with respect to such Receivable (each such payment, an "Overdue Payment"). Next, the amount of any payment in excess of Supplemental Servicing Fees and Outstanding Advances with respect to such Receivable shall be applied to the Scheduled Payment with respect to such Receivable. If the amount of such payment remaining after the applications described in the two preceding sentences (i) equals (together with any Deferred Prepayment) the unpaid principal balance of such Receivable, it shall be applied to prepay the principal balance of such Receivable, or (ii) is less than the unpaid principal balance of such Receivable, it shall constitute an Excess Payment with respect to such Receivable. (b) With respect to each Administrative Receivable and Warranty Receivable, payments made by or on behalf of the Obligor shall be applied in the same manner, except that any Released Administrative Amount or Released Warranty Amount shall be remitted to the 39 Servicer or the Seller, as applicable. A Warranty Purchase Payment or an Administrative Purchase Payment with respect to any Receivable shall be applied, first, to reduce Outstanding Advances with respect to such Receivable and then to the Scheduled Payment, in each case to the extent that the payments by the Obligor shall be insufficient, and then to prepay the unpaid principal balance of such Receivable in full. SECTION 5.04 ADVANCES; SWAP PAYMENTS. (a) As of the close of business on the last day of each Collection Period, if the payments by or on behalf of the Obligor on a Precomputed Receivable (other than an Administrative Receivable or a Warranty Receivable) after application under Section 5.03(a) shall be less than the Scheduled Payment (determined as of the Closing Date), whether as a result of any modification or extension granted to the Obligor or otherwise, then the Deferred Prepayment, if any, with respect to such Precomputed Receivable shall be applied by the Servicer to the extent of the shortfall, and such Deferred Prepayment shall be reduced accordingly. Subject to the provisions of the last sentence of this paragraph, the Servicer shall deposit an amount equal to such shortfall (each, a "Precomputed Advance") in the Collection Account on the Business Day immediately preceding the related Payment Date. In addition, as of the last day of a Collection Period, if the payments during such Collection Period by or on behalf of the Obligor on or in respect of a Simple Interest Receivable (other than an Administrative Receivable or a Warranty Receivable) after application under Section 5.03(a) shall be less than the Scheduled Payment (determined as of the Closing Date), whether as a result of any modification or extension granted to the Obligor or otherwise, then an amount equal to the product of the principal balance of such Receivable as of the first day of the related Collection Period and one-twelfth of its Annual Percentage Rate minus the amount of interest actually received on such Receivable during the Collection Period (each, a "Simple Interest Advance") shall be deposited by the Servicer into the Collection Account on the Business Day immediately preceding the related Payment Date. If such a calculation in respect of a Simple Interest Receivable results in a negative number, an amount equal to such negative amount shall be paid to the Servicer in reimbursement of any outstanding Simple Interest Advances made with respect to such Receivable. In addition, in the event that a Simple Interest Receivable becomes a Liquidated Receivable, the amount of accrued and unpaid interest thereon (but not including interest for the current Collection Period) shall, up to the amount of any outstanding Simple Interest Advances made with respect to such Receivable, be withdrawn from the Collection Account and paid to the Servicer in reimbursement of such outstanding Simple Interest Advances. No Advances will be made with respect to the Principal Balance of Simple Interest Receivables. The Servicer shall not be required to make an Advance (other than a Simple Interest Advance in respect of an interest shortfall arising from the Prepayment of a Simple Interest Receivable) to the extent that the Servicer, in its sole discretion, shall determine that such Advance is unlikely to be recovered from subsequent payments made by or on behalf of the related Obligor, Liquidation Proceeds, by the Administrative Purchase Payment or by the Warranty Purchase Payment with respect to such Receivable or otherwise. (b) The Servicer shall be entitled to reimbursement for Outstanding Advances, without interest, with respect to a Receivable from the following sources with respect to such Receivable: (i) subsequent payments made by or on behalf of the related Obligor, (ii) Liquidation Proceeds and (iii) the Warranty Purchase Payment; PROVIDED, HOWEVER, that in the 40 case of Advances made pursuant to Section 4.02, the Servicer shall be entitled to reimbursement only from amounts received in respect of such Receivable that are in excess of the amount of the Scheduled Payment in the related Collection Period. (c) To the extent that the Servicer has determined that any Outstanding Advance is a Nonrecoverable Advance, the Servicer may, in the relevant Servicer's Certificate, set forth the amount of such Nonrecoverable Advance, and on the related Payment Date, the Relevant Trustee shall promptly remit to the Servicer from Actual Payments on deposit in the Collection Account an amount equal to the amount of such Nonrecoverable Advance. The Servicer's determination of Available Collections for any Collection Period shall take into account the amount of Nonrecoverable Advances specified in any such Officer's Certificate. (d) For so long as the Monthly Remittance Conditions are satisfied, in lieu of causing the Servicer first to deposit and then the Relevant Trustee to remit to the Servicer the amounts described in clauses (i) through (iii) in Section 5.04(b) reimbursable in respect on Outstanding Advances, or the amounts described in Section 5.04(c) applicable in respect of Nonrecoverable Advances, the Servicer may deduct such amounts from deposits otherwise to be made into the Collection Account. (e) In addition, for so long as the Monthly Remittance Conditions are satisfied and TMCC or an Affiliate thereof is both the Servicer and the Swap Counterparty, the Servicer may (i) deduct any Swap Payments Outgoing and Swap Termination Payments owed by the Issuer to the Swap Counterparty from deposits otherwise to be made into the Collection Account by the Servicer and (ii) add any Swap Payments Incoming and Swap Termination Payments owed by the Swap Counterparty to the Issuer to deposits otherwise to be made into the Collection Account by the Servicer, and any such payments will be deemed to satisfy the Swap Counterparty's or the Issuer's (as applicable) payment obligations to the Issuer and the Swap Counterparty, respectively, under the Interest Rate Swap Agreement. SECTION 5.05 ADDITIONAL DEPOSITS. (a) The following additional deposits shall be made to the Collection Account: (i) the Seller shall remit the aggregate Warranty Purchase Payments with respect to Warranty Receivables pursuant to Section 3.02, (ii) the Servicer shall remit the aggregate Administrative Purchase Payments with respect to Administrative Receivables pursuant to Section 4.08 and the amount required upon any optional purchase of the Receivables by the Servicer, or any successor to the Servicer, pursuant to Section 9.01; (iii) the Servicer shall remit (A) the amount required to be remitted in respect of certain full Prepayments pursuant to Section 4.03, (B) the aggregate Advances pursuant to Sections 4.02, 5.03 and 5.04(a), (C) the amount of Payments Ahead and Applied Payments Ahead withdrawn by the Servicer or Indenture Trustee at the direction of the Servicer from the Payahead Account for application with respect to such Collection Period, and (D) all Swap Payments Incoming and Swap Termination Payments received from the Swap Counterparty; and (iv) the Indenture Trustee shall transfer the amounts described in Sections 5.06 and 5.07 from the Reserve Account to the Collection Account or Principal Distribution Account pursuant to Section 5.07. (b) All deposits required to be made pursuant to this Section by the Seller or the Servicer, as the case may be, may be made in the form of a single deposit and shall be made in immediately available funds, no later than 5:00 P.M., New York City time, on the Business 41 Day immediately preceding the related Payment Date. At the direction of the Servicer, the Relevant Trustee shall invest such amounts in Eligible Investments maturing not later than 3:00 P.M. New York City Time, on the related Payment Date. SECTION 5.06 PAYMENTS AND DISTRIBUTIONS. (a) On each Payment Date, the Indenture Trustee shall cause to be made the following transfers and distributions in immediately available funds in the amounts set forth in the Servicer's Certificate for such Payment Date (except that if the Collection Account, Principal Distribution Account, Payahead Account and Reserve Fund are not all maintained by the Indenture Trustee, transfers to be made between such accounts as described in Section 5.05, 5.06 and 5.07 shall be made on the Business Day immediately preceding each Payment Date): (i) from the Payahead Account (or directly from the Servicer in the case of Payments Ahead held by the Servicer pursuant to Section 5.02(a) or (b)) to the Collection Account, the aggregate Applied Payments Ahead; and (ii) if the Servicer is not permitted to hold Payments Ahead pursuant to Section 5.02(a) or (b), from the Collection Account to the Payahead Account, the aggregate Payments Ahead for the related Collection Period. In addition, on each Payment Date, the Indenture Trustee shall cause to be paid from the Collection Account any Swap Payments Outgoing and Swap Termination Payment payable by the Issuer to the Swap Counterparty under the Interest Rate Swap Agreement, provided that such amounts were not deducted from amounts remitted to the Collection Account by the Servicer pursuant to Section 5.04(e). (b) On each Determination Date, the Servicer shall calculate (i) the Available Collections and the amounts to be paid to Noteholders of each Class and the Certificateholder pursuant to Section 5.06(c) or 5.06(d), as the case may be, (ii) the Swap Payments Outgoing, the Swap Payments Incoming, and any Swap Termination Payments and (iii) all other distributions, deposits and withdrawals to be made on the related Payment Date. (c) Subject to Section 5.06(d), on each Payment Date, the Relevant Trustee shall make the following payments and distributions from the Collection Account in the following order of priority and in the amounts set forth in the Servicer's Certificate for such Payment Date; PROVIDED, HOWEVER, that such payments and distributions shall be made only from those funds deposited in the Collection Account for the related Collection Period and available therefore as Available Collections: (i) from Available Collections: (A) to the Servicer, the Total Servicing Fee (including any unpaid Total Servicing Fees from one or more prior Collection Periods); (B) on a pro rata basis (based on the amounts distributable pursuant to this clause to each such Class), to the Holders of the Class A-1 Notes, the Class A-1 Interest Distributable Amount and any outstanding Class A-1 Interest Carryover Shortfall, to the Holders of the Class A-2 Notes, the Class A-2 Interest Distributable Amount and any outstanding Class A-2 Interest Carryover Shortfall, to the 42 Holders of the Class A-3 Notes, the Class A-3 Interest Distributable Amount and any outstanding Class A-3 Interest Carryover Shortfall, and to the Holders of the Class A-4 Notes, the Class A-4 Interest Distributable Amount and any outstanding Class A-4 Interest Carryover Shortfall; (C) to the Principal Distribution Account, the Principal Distribution Amount; (D) to the Reserve Account, the amount, if any, necessary to cause the balance of funds therein to equal the Specified Reserve Account Balance; and (E) any remaining amounts will be distributed to the Certificateholder. (ii) from the amounts deposited into the Principal Distribution Account from the allocations of principal described in clause (i)(C) above, the Issuer will pay principal of the Securities in the following priority: (A) to the Holders of Class A-1 Notes, until the total amount paid to such Holders in respect of principal from the Closing Date is equal to the Class A-1 Initial Principal Balance; (B) to the Holders of Class A-2 Notes, until the total amount paid to such Holders in respect of principal from the Closing Date is equal to the Class A-2 Initial Principal Balance; (C) to the Holders of Class A-3 Notes, until the total amount paid to such Holders in respect of principal from the Closing Date is equal to the Class A-3 Initial Principal Balance; (D) to the Holders of Class A-4 Notes, until the total amount paid to such Holders in respect of principal from the Closing Date is equal to the Class A-4 Initial Principal Balance; and (E) after the total amount paid to Holders of the Class A-4 Notes in respect of principal from the Closing Date is equal to the Class A-4 Initial Principal Balance, any remaining funds will be paid to the Certificateholder. (d) Notwithstanding the provisions of Section 5.06(c), after an Event of Default occurs that results in the acceleration of the Notes and unless and until such acceleration has been rescinded, on each Payment Date, the Relevant Trustee shall make the following payments and distributions from the Collection Account in the following order of priority and in the amounts set forth in the Servicer's Certificate for such Payment Date; PROVIDED, HOWEVER, that such payments and distributions shall be made only from Available Collections deposited in the Collection Account for the related Collection Period: (i) to the Servicer, the Total Servicing Fee (including any unpaid Total Servicing Fees from one or more prior Collection Periods); 43 (ii) on a pro rata basis (based on the amounts distributable pursuant to this clause to each such Class), to the Holders of the Class A-1 Notes, the Class A-1 Interest Distributable Amount and any outstanding Class A-1 Interest Carryover Shortfall, to the Holders of the Class A-2 Notes, the Class A-2 Interest Distributable Amount and any outstanding Class A-2 Interest Carryover Shortfall, to the Holders of the Class A-3 Notes, the Class A-3 Interest Distributable Amount and any outstanding Class A-3 Interest Carryover Shortfall, and to the Holders of the Class A-4 Notes, the Class A-4 Interest Distributable Amount and any outstanding Class A-4 Interest Carryover Shortfall; (iii) to the Holders of Class A-1 Notes, Class A-2 Notes, Class A-3 Notes and the Class A-4 Notes, on a pro rata basis (based on the Outstanding Amount of each such Class), until the total amount paid to such Holders in respect of principal from the Closing Date is equal to the Class A-1 Initial Principal Balance, Class A-2 Initial Principal Balance, the Class A-3 Initial Principal Balance, and the Class A-4 Initial Principal Balance, respectively; (iv) after the total amount paid to such Holders in respect of principal from the Closing Date is equal to the Class A-1 Initial Principal Balance, Class A-2 Initial Principal Balance, the Class A-3 Initial Principal Balance, and the Class A-4 Initial Principal Balance, respectively, any remaining funds will be paid to the Certificateholder. (e) For purposes of determining whether an Event of Default pursuant to Section 5.01(b) of the Indenture has occurred, the amount of principal required to be paid to the Holders of any Class of Notes on any Payment Date is the amount available to be paid thereto pursuant to Sections 5.06(c)(i)(C) and 5.06(d)(iii); provided however that (i) the Class A-1 Notes are required to be paid in full on or before the Class A-1 Final Scheduled Payment Date, meaning that Holders of Class A-1 Notes are entitled to have received on or before such date payments in respect of principal in an aggregate amount equal to the Class A-1 Initial Principal Balance together with all interest accrued thereon through such date; (ii) the Class A-2 Notes are required to be paid in full on or before the Class A-2 Final Scheduled Payment Date, meaning that Holders of Class A-2 Notes are entitled to have received on or before such date payments in respect of principal in an aggregate amount equal to the Class A-2 Initial Principal Balance together with all interest accrued thereon through such date, (iii) the Class A-3 Notes are required to be paid in full on or before the Class A-3 Final Scheduled Payment Date, meaning that Holders of Class A-3 Notes are entitled to have received on or before such date payments in respect of principal in an aggregate amount equal to the Class A-3 Initial Principal Balance together with all interest accrued thereon through such date; and (iv) the Class A-4 Notes are required to be paid in full on or before the Class A-4 Final Scheduled Payment Date, meaning that Holders of Class A-4 Notes are entitled to have received on or before such date payments in respect of principal in an aggregate amount equal to the Class A-4 Initial Principal Balance together with all interest accrued thereon through such date. (f) Except with respect to the final payment upon retirement of a Note or Certificate, the Servicer shall on each Payment Date instruct the Relevant Trustee to pay or distribute to each Securityholder of record on the related Record Date by check mailed to such Securityholder at the address of such Holder appearing in the Note Register, or herein (in the case of the Certificate) (or, if DTC, its nominee or a Clearing Agency is the relevant Holder, by wire 44 transfer of immediately available funds or pursuant to other arrangements), the amount to be paid or distributed to such Securityholder pursuant to such Holder's Note or Certificate. With respect to the final payment upon retirement of a Note or of the Certificate, the Servicer shall on the relevant final Payment Date instruct the Relevant Trustee to pay or distribute the amounts due thereon only upon delivery for cancellation of the certificate representing such Note or Certificate in accordance with the Indenture or the Trust Agreement, as the case may be. SECTION 5.07 RESERVE ACCOUNT. (a) In order to assure that certain amounts will be available to make required payments to Noteholders, the Seller will, pursuant to the Securities Account Control Agreement and the Indenture, establish and maintain with the Indenture Trustee a segregated trust account (the "Reserve Account") which will include the money and other property deposited and held therein pursuant to Section 5.06(c)(i)(D) and this Section. On or prior to the Closing Date, the Seller shall deposit an amount equal to the Reserve Account Initial Deposit into the Reserve Account. As and to the extent set forth in Section 5.06(c)(i)(D), as directed in writing by the Servicer, the Indenture Trustee will deposit Available Collections into the Reserve Account on each Payment Date, until the amount on deposit therein equals the Specified Reserve Account Balance. On each Payment Date, to the extent that Available Collections are insufficient to fully fund the payments and distributions described in clauses (i)(A) through (C) of Section 5.06(c) or in clauses (i) through (iii) of Section 5.06(d), the Indenture Trustee will withdraw amounts then on deposit in the Reserve Account (excluding net investment income on Eligible Investments which amounts are payable to the Seller therefrom), up to the amounts of any such deficiencies, and deposit such amounts into the Collection Account for application pursuant to such clauses. Also on each Payment Date, as directed in writing by the Servicer, the Indenture Trustee will release to the Seller any amounts remaining on deposit in the Reserve Account in excess of the Specified Reserve Account Balance. Also, upon the termination of the trusts established under the Trust Agreement and the Indenture, as directed in writing by the Servicer, the Indenture Trustee will release to the Seller any amounts remaining on deposit in the Reserve Account. Upon any such distribution to the Seller, the Issuer, Owner Trustee, Certificateholder, Indenture Trustee and Noteholders will have no further rights in, or claims to, such amounts. (b) All amounts held in the Reserve Account shall be invested by the Indenture Trustee, as directed in writing by the Servicer, in Eligible Investments. Earnings on investment of funds in the Reserve Account shall be paid to the Seller on each Payment Date, and losses and any investment expenses shall be charged against the funds on deposit therein. The Indenture Trustee shall incur no liability for the selection of investments or for losses thereon absent its own negligence or willful misfeasance. The Indenture Trustee shall have no liability in respect of losses incurred as a result of the liquidation of any investment prior to its stated maturity date or the failure of the Servicer to provide timely written investment directions. (c) Subject to the right of the Indenture Trustee to make withdrawals therefrom, as directed by the Servicer, for the purposes and in the amounts set forth in Section 5.06, the Reserve Account and all funds held therein shall be the property of the Seller and not the property of the Issuer, the Owner Trustee or the Indenture Trustee. The Issuer, Owner Trustee, Seller and Indenture Trustee will treat the Reserve Account, all funds therein and all net investment income with respect thereto as assets of the Seller for federal income tax and all other purposes. 45 (d) The Seller will grant to the Indenture Trustee, for the benefit of the Noteholders, a security interest in all funds (including Eligible Investments) in the Reserve Account (including the Reserve Account Initial Deposit) and the proceeds thereof, and the Indenture Trustee shall have all of the rights of a secured party under the UCC with respect thereto; provided that all income from the investment of funds in the Reserve Account and the right to receive such income are retained by the Seller and are not transferred, assigned or otherwise conveyed hereunder. If for any reason the Reserve Account is no longer an Eligible Deposit Account, the Indenture Trustee shall promptly cause the Reserve Account to be moved to another institution or otherwise changed so that the Reserve Account becomes an Eligible Deposit Account. Neither the Owner Trustee nor the Indenture Trustee shall enter into any subordination or intercreditor agreement with respect to the Reserve Account. SECTION 5.08 STATEMENTS TO CERTIFICATEHOLDER, NOTEHOLDERS, AND SWAP COUNTERPARTY. (a) On each Payment Date, the Servicer shall provide to the Indenture Trustee (with a copy to the Rating Agencies and each Paying Agent) for the Indenture Trustee to forward to each Noteholder of record as of the most recent Record Date and to the Owner Trustee (with a copy to each Paying Agent) for the Owner Trustee to forward to each Certificateholder of record as of the most recent Record Date a statement substantially in the form of Exhibit A and to the Swap Counterparty (unless TMCC or an Affiliate thereof is the Servicer and the Swap Counterparty at the time of delivery), setting forth at least the following information as to the Notes and the Certificate to the extent applicable: (i) the amount paid or distributed in respect of interest in respect of each Class of Notes; (ii) the amount paid or distributed in respect of principal on or with respect to each Class of Notes; (iii) the amount paid or distributed to the Certificateholder; (iv) the Pool Balance as of the close of business on the last day of the preceding Collection Period; (v) the Outstanding Amount, the Class A-1 Principal Balance, the Class A-2 Principal Balance, the Class A-3 Principal Balance, the Class A-4 Principal Balance, and the Note Pool Factor for each Class of Notes, in each case after giving effect to all payments in respect of principal on such Payment Date; (vi) the amount of the Servicing Fee paid to the Servicer with respect to the related Collection Period; (vii) the amount of any Class A-1 Interest Carryover Shortfall, Class A-2 Interest Carryover Shortfall, Class A-3 Interest Carryover Shortfall and Class A-4 Interest Carryover Shortfall after giving effect to all payments of interest on such Payment Date, and the change in such amounts from the preceding Payment Date; 46 (viii) the aggregate amount of Payments Ahead on deposit in the Payahead Account or held by the Servicer with respect to the related Receivables and the change in such amount from the immediately preceding Payment Date; (ix) the amount of Advances made in respect of the related Receivables and the related Collection Period and the amount of unreimbursed Advances on such Payment Date; (x) the balance of any Reserve Account on such Payment Date and the Specified Reserve Account Amount on such Payment Date, after giving effect to changes thereto on such Payment Date; and (xi) the Class A-2 Notional Balance, the A-3 Notional Balance, the Class A-4 Notional Balance, the Class A-2 Rate, the Class A-3 Rate, the Class A-4 Rate, the Swap Payments Incoming, the Swap Payments Outgoing and the Swap Termination Payment. SECTION 5.09 NET DEPOSITS. As an administrative convenience, the Seller, the Servicer, the Owner Trustee and the Indenture Trustee may make any remittances pursuant to this Article net of amounts to be distributed by the applicable recipient to such remitting party. Nonetheless, each such party shall account to the Owner Trustee, the Indenture Trustee, the Noteholders and the Certificateholder for all of the above described remittances, payments and distributions as if all deposits, payments, distributions and transfers were made individually. ARTICLE VI THE SELLER SECTION 6.01 REPRESENTATIONS OF SELLER. The Seller makes the following representations on which the Issuer is deemed to have relied in acquiring the Receivables. The representations speak as of the execution and delivery of this Agreement and as of the Closing Date, and shall survive the sale of the Receivables to the Issuer and the pledge thereof to the Indenture Trustee pursuant to the Indenture. (a) ORGANIZATION AND GOOD STANDING. The Seller shall have been duly organized and shall be validly existing as a limited liability company in good standing under the laws of the State of Delaware, with power and authority to own its properties and to conduct its business as such properties shall be currently owned and such business is presently conducted, and had at all relevant times, and shall now have, power, authority and legal right to acquire, own and sell the Receivables. (b) DUE QUALIFICATION. The Seller shall be duly qualified to do business as a foreign limited liability company in good standing, and shall have obtained all necessary licenses and approvals in all jurisdictions in which the ownership or lease of property or the conduct of its business shall require such qualifications and where the failure to so qualify will have a material adverse effect on the ability of the Seller to conduct its business or perform its obligations under this Agreement. 47 (c) POWER AND AUTHORITY. The Seller shall have the power and authority to execute and deliver this Agreement and to carry out its terms; the Seller shall have full power and authority to sell and assign the property to be sold and assigned to and deposited as part of the Owner Trust Estate or Trust Estate, as the case may be, and shall have duly authorized such sale and assignment to the Issuer, the Owner Trustee or the Indenture Trustee, as the case may be; and the execution, delivery and performance of this Agreement shall have been duly authorized by the Seller by all necessary action. (d) VALID SALE; BINDING OBLIGATIONS. This Agreement shall evidence a valid sale, transfer and assignment of the Receivables, enforceable against creditors of and purchasers from the Seller; and shall constitute a legal, valid and binding obligation of the Seller enforceable in accordance with its terms, except as enforceability may be limited by bankruptcy, insolvency, reorganization or other similar laws affecting creditors' rights generally or by general equity principles. (e) NO VIOLATION. The consummation of the transactions contemplated by this Agreement and the fulfillment of the terms of this Agreement shall not conflict with, result in any breach of any of the terms and provisions of, nor constitute (with or without notice or lapse of time) a default under, the Certificate of Formation or limited liability company agreement of the Seller or any indenture, agreement or other instrument to which the Seller is a party or by which it shall be bound; nor result in the creation or imposition of any Lien upon any of its properties pursuant to the terms of any such indenture, agreement or other instrument (other than the Basic Documents), nor violate any law or, to the best of the Seller's knowledge, any order, rule or regulation applicable to the Seller of any court or of any federal or state regulatory body, administrative agency or other governmental instrumentality having jurisdiction over the Seller or its properties which breach, default, conflict, lien or violation would have a material adverse effect on the earnings, business affairs or business prospects of the Seller. (f) NO PROCEEDINGS. There is no action, suit or proceeding before or by any court or governmental agency or body, domestic or foreign, now pending, or to the Seller's knowledge, threatened, against or affecting the Seller: (i) asserting the invalidity of this Agreement, the Trust Agreement, the Indenture, the Securities Account Control Agreement, the Certificate or the Notes, (ii) seeking to prevent the issuance of the Certificate or the Notes or the consummation of any of the transactions contemplated by this Agreement, the Trust Agreement, or the Indenture, (iii) seeking any determination or ruling that might materially and adversely affect the performance by the Seller of its obligations under, or the validity or enforceability of, this Agreement, the Trust Agreement, the Indenture, the Certificate or the Notes, or (iv) relating to the Seller and which might adversely affect the federal income tax attributes of the Issuer, the Certificate or the Notes. SECTION 6.02 COMPANY EXISTENCE. During the term of this Agreement, the Seller will keep in full force and effect its existence, rights and franchises as a limited liability company under the laws of the jurisdiction of its formation and will obtain and preserve its qualification to do business in each jurisdiction in which such qualification is or shall be necessary to protect the validity and enforceability of the Basic Documents and each other instrument or agreement necessary or appropriate to the proper administration of this Agreement and the transactions 48 contemplated hereby. In addition, all transactions and dealings between the Seller and its Affiliates (including the Issuer) will be conducted on an arm's length basis. SECTION 6.03 LIABILITY OF SELLER; INDEMNITIES. The Seller shall be liable in accordance herewith only to the extent of the obligations specifically undertaken by the Seller under this Agreement. (a) The Seller shall indemnify, defend and hold harmless the Issuer, the Owner Trustee, the Indenture Trustee and the Servicer from and against any taxes that may at any time be asserted against any such Person with respect to, as of the date hereof, the sale of the Receivables to the Issuer or the issuance and original sale of the Notes and the Certificates, including any sales, gross receipts, general corporation, tangible personal property, privilege or license taxes (but, in the case of the Issuer, not including any taxes asserted with respect to, and as of the date of, the sale of the Receivables to the Issuer or the issuance and original sale of the Certificate or any of the Notes, or asserted with respect to ownership of the Receivables or federal or other income taxes arising out of payments or distributions on the Certificate or the Notes) and costs and expenses in defending against the same. (b) The Seller shall indemnify, defend and hold harmless the Issuer, the Owner Trustee, the Indenture Trustee, the Issuer, the Certificateholder and the Noteholders and any of the officers, directors, employees and agents of the Issuer, the Owner Trustee and the Indenture Trustee from and against any loss, liability or expense incurred by reason of (i) the Seller's willful misfeasance, bad faith or negligence in the performance of its duties under this Agreement, or by reason of reckless disregard of its obligations and duties under this Agreement and (ii) the Seller's or the Issuer's violation of federal or state securities laws in connection with the offering and sale of any of the Notes or the Certificate. (c) Except as set forth in clause (a) above, the Seller shall pay any and all taxes levied or assessed upon all or any part of the Owner Trust Estate. (d) Promptly after receipt by a party indemnified under this Section 6.03 (an "Indemnified Party") of notice of the commencement of any action, such Indemnified Party will, if a claim in respect thereof is to be made against the party providing indemnification under this Section 6.03 (an "Indemnifying Party"), notify such Indemnifying Party of the commencement thereof. In case any such action is brought against any Indemnified Party under this Section 6.03 and it notifies the Indemnifying Party of the commencement thereof, the Indemnifying Party will assume the defense thereof, with counsel reasonably satisfactory to such Indemnified Party (who may, unless there is, as evidenced by an opinion of counsel to the Indemnified Party stating that there is an unwaivable conflict of interest, be counsel to the Indemnifying Party), and the Indemnifying Party will not be liable to such Indemnified Party under this Section for any legal or other expenses subsequently incurred by such Indemnified Party in connection with the defense thereof, other than reasonable costs of investigation. The obligations set forth in this Section 6.03 shall survive the termination of this Agreement or the resignation or removal of the Owner Trustee or the Indenture Trustee and shall include reasonable fees and expenses of counsel and expenses of litigation. If the Seller shall have made any indemnity payments pursuant to this Section and the Person to or on behalf of whom such payments are made 49 thereafter collects any of such amounts from others, such Person shall promptly repay such amounts to the Seller, without interest. SECTION 6.04 MERGER OR CONSOLIDATION OF, OR ASSUMPTION OF THE OBLIGATIONS OF, SELLER. Any Person (a) into which the Seller may be merged or consolidated, (b) which may result from any merger or consolidation to which the Seller shall be a party or (c) which may succeed to the properties and assets of the Seller substantially as a whole, which person in any of the foregoing cases executes an agreement of assumption to perform every obligation of the Seller under this Agreement, shall be the successor to the Seller hereunder without the execution or filing of any document or any further act by any of the parties to this Agreement; provided, however, that (i) immediately after giving effect to such transaction, no representation or warranty made pursuant to Section 6.01 shall have been breached (except that the representations regarding the due organization and valid existence of the successor may be deemed to reference jurisdictions other than California), (ii) the Seller shall have delivered to the Owner Trustee and the Indenture Trustee an Officer's Certificate and an Opinion of Counsel each stating that such consolidation, merger or succession and such agreement of assumption comply with this Section and that all conditions precedent, if any, provided for in this Agreement relating to such transaction have been complied with, (iii) the Seller shall have given 10 days' written notice to each Rating Agency of its intent or expectation to enter such transaction and neither Rating Agency shall have notified the Seller, the Owner Trustee or the Indenture Trustee that such transaction might or would cause it to reduce, withdraw or modify its then current rating of any Class of Notes and (iv) the Seller shall have delivered to the Owner Trustee and the Indenture Trustee an Opinion of Counsel either (A) stating that, in the opinion of such counsel, all financing statements and continuation statements and amendments thereto have been executed and filed that are necessary fully to preserve and protect the interest of the Owner Trustee and Indenture Trustee, respectively, in the Receivables and reciting the details of such filings, or (B) stating that, in the opinion of such counsel, no such action shall be necessary to preserve and protect such interests. Notwithstanding anything herein to the contrary, the execution of the foregoing agreement of assumption and compliance with clauses (i), (ii), (iii) and (iv) above shall be conditions to the consummation of the transactions referred to in clauses (a), (b) or (c) above. SECTION 6.05 LIMITATION ON LIABILITY OF SELLER AND OTHERS. The Seller and any director, officer, employee or agent of the Seller may rely in good faith on the advice of counsel or on any document of any kind, prima facie properly executed and submitted by any Person respecting any matters arising hereunder. The Seller shall not be under any obligation to appear in, prosecute or defend any legal action that shall not be incidental to its obligations under this Agreement and that in its opinion may involve it in any expense or liability. SECTION 6.06 SELLER MAY OWN CERTIFICATE OR NOTES. The Seller will own the Certificate, and the Seller and any Affiliate thereof may in its individual or any other capacity become the owner or pledgee of the Notes of any class with the same rights as it would have if it were not the Seller or an Affiliate thereof, except as expressly provided in any Basic Document. 50 ARTICLE VII THE SERVICER SECTION 7.01 REPRESENTATIONS OF SERVICER. The Servicer makes the following representations on which the Issuer is deemed to have relied in acquiring the Receivables. The representations speak as of the execution and delivery of this Agreement and as of the Closing Date and shall survive the sale of the Receivables to the Issuer and the pledge thereof to the Indenture Trustee pursuant to the Indenture. (a) ORGANIZATION AND GOOD STANDING. The Servicer shall have been duly organized and shall be validly existing as a corporation in good standing under the laws of the State of California, with corporate power and authority to own its properties and to conduct its business as such properties shall be currently owned and such business is presently conducted, and had at all relevant times, and shall now have, corporate power, authority and legal right to acquire, own and sell the Receivables. (b) DUE QUALIFICATION. The Servicer shall be duly qualified to do business as a foreign corporation in good standing, and shall have obtained all necessary licenses and approvals in all jurisdictions in which the ownership or lease of property or the conduct of its business shall require such qualifications and where the failure to so qualify will have a material adverse effect on the ability of the Servicer to conduct its business or perform its obligations under this Agreement. (c) POWER AND AUTHORITY. The Servicer shall have the corporate power and authority to execute and deliver this Agreement and to carry out its terms; and the execution, delivery and performance of this Agreement have been duly authorized by the Servicer by all necessary corporate action. (d) BINDING OBLIGATIONS. This Agreement shall constitute a legal, valid and binding obligation of the Servicer enforceable in accordance with its terms, except as enforceability may be limited by bankruptcy, insolvency, reorganization or other similar laws affecting creditors' rights generally or by general equity principles. (e) NO VIOLATION. The consummation of the transactions contemplated by this Agreement and the fulfillment of the terms of this Agreement shall not conflict with, result in any breach of any of the terms and provisions of, nor constitute (with or without notice or lapse of time) a default under, the articles of incorporation or bylaws of the Servicer or any indenture, agreement or other instrument to which the Servicer is a party or by which it shall be bound; nor result in the creation or imposition of any Lien upon any of its properties pursuant to the terms of any such indenture, agreement or other instrument (other than this Agreement), nor violate any law or, to the best of the Servicer's knowledge, any order, rule or regulation applicable to the Servicer of any court or of any federal or state regulatory body, administrative agency or other governmental instrumentality having jurisdiction over the Servicer or its properties which breach, default, conflict, lien or violation would have a material adverse effect on the earnings, business affairs or business prospects of the Servicer. 51 (f) NO PROCEEDINGS. There is no action, suit or proceeding before or by any court or governmental agency or body, domestic or foreign, now pending, or to the Servicer's knowledge, threatened, against or affecting the Servicer: (i) asserting the invalidity of this Agreement, the Trust Agreement, the Indenture, the Certificate or the Notes, (ii) seeking to prevent the issuance of the Certificate or the Notes or the consummation of any of the transactions contemplated by this Agreement, the Trust Agreement or the Indenture, (iii) seeking any determination or ruling that might materially and adversely affect the performance by the Servicer of its obligations under, or the validity or enforceability of, this Agreement, the Trust Agreement, the Indenture, the Certificate or the Notes, or (iv) relating to the Servicer and which might adversely affect the federal income tax attributes of the Issuer, the Certificate or the Notes. SECTION 7.02 INDEMNITIES OF SERVICER. The Servicer shall be liable in accordance herewith only to the extent of the obligations specifically undertaken by the Servicer under this Agreement: (a) The Servicer shall indemnify, defend and hold harmless the Seller, the Issuer, the Owner Trustee, the Indenture Trustee, the Noteholders and the Certificateholder and any of the officers, directors, employees and agents of the Seller, the Issuer, the Owner Trustee and the Indenture Trustee from and against any and all costs, expenses, losses, damages, claims and liabilities, arising out of or resulting from the use, ownership or operation by the Servicer or any Affiliate thereof of a Financed Vehicle. (b) The Servicer shall indemnify, defend and hold harmless the Owner Trustee and the Indenture Trustee and their respective officers, directors, employees and agents from and against all costs, expenses, losses, claims, damages and liabilities arising out of or incurred in connection with the acceptance or performance of the trusts and duties herein and in the Trust Agreement contained, in the case of the Owner Trustee, and in the Indenture contained, in the case of the Indenture Trustee, except to the extent that such cost, expense, loss, claim, damage or liability: (i) in the case of the Owner Trustee, shall be due to the willful misfeasance, bad faith or negligence (except for errors in judgment) of the Owner Trustee or, in the case of the Indenture Trustee, shall be due to the willful misfeasance, bad faith or negligence (except for errors in judgment) of the Indenture Trustee; or (ii) in the case of the Owner Trustee, shall arise from the breach by the Owner Trustee of any of its representations or warranties set forth in Section 7.03 of the Trust Agreement. (c) The Servicer shall indemnify, defend and hold harmless the Seller, the Issuer, the Owner Trustee, the Indenture Trustee, the Certificateholder and the Noteholders and any of the officers, directors, employees and agents of the Seller, the Issuer, the Owner Trustee, the Indenture Trustee and the Certificateholder from and against any and all costs, expenses, losses, claims, damages and liabilities (including without limitation reasonable fees and expenses of counsel) to the extent that such cost, expense, loss, claim, damage or liability arose out of, or is imposed upon any such Person through, the negligence, willful misfeasance or bad faith of the Servicer in the performance of its duties under this Agreement or by reason of reckless disregard of its obligations and duties under this Agreement, including those that may be incurred by any such indemnified party as a result of any act or omission by the Servicer in connection with its maintenance and custody of the Receivables Files. 52 (d) Promptly after receipt by a party indemnified under this Section 7.02 (an "Indemnified Party") of notice of the commencement of any action, such Indemnified Party will, if a claim in respect thereof is to be made against the party providing indemnification under this Section 7.02 (an "Indemnifying Party"), notify such Indemnifying Party of the commencement thereof. In case any such action is brought against any Indemnified Party under this Section 7.02 and it notifies the Indemnifying Party of the commencement thereof, the Indemnifying Party will assume the defense thereof, with counsel reasonably satisfactory to such Indemnified Party (who may, unless there is, as evidenced by an opinion of counsel to the Indemnified Party stating that there is an unwaivable conflict of interest, be counsel to the Indemnifying Party), and the Indemnifying Party will not be liable to such Indemnified Party under this Section for any legal or other expenses subsequently incurred by such Indemnified Party in connection with the defense thereof, other than reasonable costs of investigation. The obligations set forth in this Section 7.02 shall survive the termination of this Agreement or the resignation or removal of the Servicer, the Owner Trustee or the Indenture Trustee and shall include reasonable fees and expenses of counsel and expenses of litigation. If the Servicer shall have made any indemnity payments pursuant to this Section and the Person to or on behalf of whom such payments are made thereafter collects any of such amounts from others, such Person shall promptly repay such amounts to the Servicer, without interest. For purposes of this Section, in the event of the termination of the rights and obligations of TMCC (or any successor thereto pursuant to Section 7.03) as Servicer pursuant to Section 8.01, or a resignation by such Servicer pursuant to this Agreement, such Servicer shall be deemed to be the Servicer pending appointment of a successor Servicer (other than the Indenture Trustee) pursuant to Section 8.02. SECTION 7.03 MERGER OR CONSOLIDATION OF, OR ASSUMPTION OF THE OBLIGATIONS OF, SERVICER. Any corporation (a) into which the Servicer may be merged or consolidated, (b) which may result from any merger, conversion or consolidation to which the Servicer shall be a party or (c) which may succeed to all or substantially all of the business of the Servicer, which corporation in any of the foregoing cases executes an agreement of assumption to perform every obligation of the Servicer under this Agreement, shall be the successor to the Servicer under this Agreement without the execution or filing of any paper or any further act on the part of any of the parties to this Agreement; provided, however, that (i) immediately after giving effect to such transaction, no representation or warranty made pursuant to Section 7.01 shall have been breached (except that the representations regarding the due organization and valid existence of the successor may be deemed to reference jurisdictions other than California), and no Servicer Default, and no event which, after notice or lapse of time, or both, would become a Servicer Default, shall have occurred and be continuing, (ii) the Servicer shall have delivered to the Owner Trustee and the Indenture Trustee an Officer's Certificate and an Opinion of Counsel each stating that such consolidation, merger or succession and such agreement of assumption comply with this Section and that all conditions precedent provided for in this Agreement relating to such transaction have been complied with, (iii) the Servicer shall have given 10 days' written notice to each Rating Agency of its intent or expectation to enter such transaction and neither Rating Agency shall have notified the Seller, the Owner Trustee or the Indenture Trustee that such transaction might or would cause it to reduce, withdraw or modify its then current rating of any Class of Notes, (iv) immediately after giving effect to such transaction, the successor to the Servicer shall become the Administrator under the Administration Agreement in 53 accordance with Section 8 of such Agreement and (v) the Servicer shall have delivered to the Owner Trustee and the Indenture Trustee an Opinion of Counsel stating that, in the opinion of such counsel, either (A) all financing statements and continuation statements and amendments thereto have been executed and filed that are necessary fully to preserve and protect the interest of the Owner Trustee and the Indenture Trustee, respectively, in the Receivables and reciting the details of such filings or (B) no such action shall be necessary to preserve and protect such interests. Notwithstanding anything herein to the contrary, the execution of the foregoing agreement of assumption and compliance with clauses (i), (ii), (iii), (iv) and (v) above shall be conditions to the consummation of the transactions referred to in clause (a), (b) or (c) above. SECTION 7.04 LIMITATION ON LIABILITY OF SERVICER AND OTHERS. Neither the Servicer nor any of the directors, officers, employees or agents of the Servicer shall be under any liability to the Seller, the Issuer, the Indenture Trustee, the Owner Trustee, the Noteholders or the Certificateholder, except as provided under this Agreement, for any action taken or for refraining from the taking of any action pursuant to this Agreement or for errors in judgment; provided, however, that this provision shall not protect the Servicer or any such person against any liability that would otherwise be imposed by reason of willful misfeasance, bad faith or negligence in the performance of duties or by reason of reckless disregard of obligations and duties under this Agreement. The Servicer and any director, officer, employee or agent of the Servicer may rely in good faith on any document of any kind prima facie properly executed and submitted by any person respecting any matters arising under this Agreement. Except as provided in this Agreement, the Servicer shall not be under any obligation to appear in, prosecute or defend any legal action that shall not be incidental to its duties to service the Receivables in accordance with this Agreement, and that in its opinion may involve it in any expense or liability; PROVIDED, HOWEVER, that the Servicer may (with the written consent of the Owner Trustee or Indenture Trustee) undertake any reasonable action that it may deem necessary or desirable in respect of the Basic Documents and the rights and duties of the parties to the Basic Documents and the interests of the Certificateholder under this Agreement and the Noteholders under the Indenture. In such event, the reasonable legal expenses and costs for such action and any liability resulting therefrom shall be expenses, costs and liabilities of the Trust Estate (if any Notes are then outstanding) or the Owner Trust Estate (if no Notes are then outstanding) and the Servicer will be entitled to be reimbursed therefor solely from Available Collections. SECTION 7.05 TMCC NOT TO RESIGN AS SERVICER. Subject to the provisions of Section 7.03, TMCC shall not resign from the obligations and duties hereby imposed on it as Servicer under this Agreement except upon a determination that the performance of its duties under this Agreement shall no longer be permissible under applicable law. Notice of any such determination permitting the resignation of TMCC shall be communicated to the Owner Trustee, the Indenture Trustee and each Rating Agency at the earliest practicable time (and, if such communication is not in writing, shall be confirmed in writing at the earliest practicable time) and any such determination shall be evidenced by an Opinion of Counsel to such effect delivered to the Owner Trustee and the Indenture Trustee concurrently with or promptly after such notice. No such resignation shall become effective until the Indenture Trustee or a successor Servicer shall have (i) assumed the responsibilities and obligations of TMCC in accordance with Section 54 8.02 and (ii) become the Administrator under the Administration Agreement in accordance with Section 8 of such Agreement. ARTICLE VIII DEFAULT SECTION 8.01 SERVICER DEFAULT. Each of the following events is a "Servicer Default": (a) any failure by the Servicer (or the Seller, so long as TMCC is the Servicer) to deliver to the Relevant Trustee for deposit in the Collection Account, Payahead Account or Reserve Fund any required payment or to direct the Relevant Trustee to make any required payment or distribution therefrom, which failure continues unremedied for a period of three Business Days after discovery of the failure by an officer of the Servicer or written notice of such failure is received (i) by the Servicer (or the Seller, so long as TMCC is the Servicer) from the Owner Trustee or the Indenture Trustee or (ii) to the Seller or the Servicer, as the case may be, and to the applicable Owner Trustee and Indenture Trustee by the Holders of Notes evidencing not less than 25% of the Class A Notes, acting as a single Class, excluding for purposes of such calculation and action all Securities held or beneficially owned by TMCC, TAFR LLC or any of their Affiliates (provided that such event will not be a Servicer Default if (A) such failure or delay is caused by an event of force majeure, (B) does not continue for more than 10 Business Days, (C) during such period the Servicer uses all commercially reasonable efforts to perform its obligations under this Agreement and (D) the Servicer provides to the Owner Trustee, Indenture Trustee, Seller and Securityholders prompt notice of such failure or delay that includes a description of the Servicer's efforts to remedy such failure or delay); (b) failure by the Servicer or the Seller, as the case may be, duly to observe or to perform in any material respect any other covenants or agreements of the Servicer or the Seller (as the case may be) set forth in this Agreement, which failure shall materially and adversely affect the rights of Certificateholder or Noteholders and shall continue unremedied for a period of 90 days after the date on which written notice of such failure is received (i) by the Servicer (or the Seller, so long as TMCC is the Servicer) from the Owner Trustee or the Indenture Trustee or (ii) to the Seller or the Servicer, as the case may be, and to the Owner Trustee and Indenture Trustee by the holders of Notes evidencing not less than 25% of the Class A Notes, acting together as a single Class, excluding for purposes of such calculation and action all Securities held or beneficially owned by TMCC, TAFR LLC or any of their Affiliates; or (c) the occurrence of an Insolvency Event with respect to the Servicer. At any time when a Servicer Default has occurred and is continuing, so long as the Servicer Default shall not have been remedied, either the Indenture Trustee or the Holders of Notes evidencing not less than 51% of the Outstanding Amount of the Class A Notes acting as a single Class, excluding for purposes of such calculation and action all Securities held or beneficially owned by TMCC, TAFR LLC or any of their Affiliates, by notice then given in writing to the Servicer (and to the Indenture Trustee and the Owner Trustee if given by the Noteholders) may terminate all the rights and obligations (other than the obligations set forth in Section 7.02 hereof and the rights set forth in Section 7.04 hereof) of the Servicer under this Agreement. By the 55 same required vote, the Noteholders specified in the prior sentence may waive any such Servicer Default (other than a default in the making of any required deposits or payments from or to the Collection Account, Reserve Account or Payahead Account) for a specified period or permanently. Upon any such waiver of a past default, such default shall cease to exist, and any Servicer Default arising therefrom shall be deemed to have been remedied for every purpose of this Agreement. No such waiver shall extend to any subsequent or other default or impair any right consequent thereto. SECTION 8.02 APPOINTMENT OF SUCCESSOR. (a) Upon the Servicer's receipt of notice of termination pursuant to Section 8.01 or the Servicer's resignation in accordance with the terms of this Agreement, the predecessor Servicer shall continue to perform its functions as Servicer under this Agreement, in the case of termination, only until the date specified in such termination notice or, if no such date is specified in a notice of termination, until receipt of such notice and, in the case of resignation, until the later of (i) the date 45 days from the delivery to the Owner Trustee and the Indenture Trustee of written notice of such resignation (or written confirmation of such notice) in accordance with the terms of this Agreement and (ii) the date upon which the predecessor Servicer shall become unable to act as Servicer, as specified in the notice of resignation and accompanying Opinion of Counsel. In the event of the Servicer's termination hereunder, the Indenture Trustee shall appoint a Successor Servicer, and the Successor Servicer shall accept its appointment (including its appointment as Administrator under the Administration Agreement as set forth in Section 8.02(b)) by a written assumption in form acceptable to the Owner Trustee and the Indenture Trustee. In the event that a Successor Servicer has not been appointed at the time when the predecessor Servicer has ceased to act as Servicer in accordance with this Section, the Indenture Trustee without further action shall automatically be appointed the Successor Servicer and the Indenture Trustee shall be entitled to the Servicing Fee. Notwithstanding the above, the Indenture Trustee shall, if it shall be unwilling or legally unable so to act, appoint or petition a court of competent jurisdiction to appoint any established institution having a net worth of not less than $50,000,000 and whose regular business shall include the servicing of automobile and/or light-duty truck receivables, as the successor to the Servicer under this Agreement. In connection therewith, the Indenture Trustee is authorized and empowered to offer such successor servicer compensation up to, but not in excess of, the Total Servicing Fee and other servicing compensation specified in this Agreement as payable to the initial Servicer. Upon such appointment, the Indenture Trustee will be released from the duties and obligations of acting as Successor Servicer, such release effective upon the effective date of the servicing agreement entered into between the Successor Servicer and the Issuer. (b) Upon appointment, the successor Servicer (including the Indenture Trustee acting as successor Servicer) shall (i) be the successor in all respects to the predecessor Servicer and shall be subject to all the responsibilities, duties and liabilities arising thereafter relating thereto placed on the predecessor Servicer and shall be entitled to the Servicing Fee and all the rights granted to the predecessor Servicer by the terms and provisions of this Agreement and (ii) become the Administrator under the Administration Agreement in accordance with Section 8 of such Agreement. 56 (c) On or after the receipt by the Servicer of written notice of termination pursuant to Section 8.01, all authority and power of the Servicer under this Agreement, whether with respect to the Notes, the Certificate or the Receivables or otherwise, shall, without further action, pass to and be vested in the Indenture Trustee or such Successor Servicer as may be appointed under this Section 8.02 and, without limitation, the Indenture Trustee and the Owner Trustee are hereby authorized and empowered to execute and deliver, for the benefit of the predecessor Servicer, as attorney-in-fact or otherwise, any and all documents and other instruments, and to do or accomplish all other acts or things necessary or appropriate to effect the purposes of such notice of termination, whether to complete the transfer and endorsement of the Receivables and related documents, or otherwise. The predecessor Servicer shall cooperate with the Successor Servicer and the Owner Trustee in effecting the termination of the responsibilities and rights of the predecessor Servicer under this Agreement, including, without limitation, the transfer to the Successor Servicer for administration by it of all cash amounts that shall at the time be held by the predecessor Servicer for deposit, or have been deposited by the predecessor Servicer, in the Collection Account or Payahead Account or thereafter received with respect to the Receivables and all Payments Ahead that shall at that time be held by the predecessor Servicer. All reasonable costs and expenses (including attorneys' fees) incurred in connection with transferring the Receivable Files to the Successor Servicer and amending this Agreement to reflect such succession as Servicer pursuant to this Section shall be paid by the predecessor Servicer upon presentation of reasonable documentation of such costs and expenses. In the event that the Indenture Trustee succeeds to the rights and obligations of the Servicer hereunder, and a subsequent transfer of such rights and obligations is effected pursuant to Section 8.01 or this Section 8.02 hereof, the original Servicer hereunder shall reimburse the Indenture Trustee for all reasonable costs and expenses as described in the immediately preceding sentence. Upon receipt of notice of the occurrence of a Servicer Default, the Indenture Trustee shall give notice thereof to the Rating Agencies. SECTION 8.03 REPAYMENT OF ADVANCES; COMPENSATION PAYABLE. If the Servicer shall resign or be terminated, the Servicer shall continue to be entitled to receive reimbursement for Outstanding Advances pursuant to Sections 5.03 and 5.04 with respect to all Advances previously made thereby in the manner specified in such Sections, and shall continue to be entitled to all accrued and unpaid compensation payable to the Servicer through the date of such termination as specified in Section 4.09 of this Agreement. SECTION 8.04 NOTIFICATION. Upon any termination of, or appointment of a successor to, the Servicer pursuant to this Article VIII, the Owner Trustee shall give prompt written notice thereof to Certificateholder, and the Indenture Trustee shall give prompt written notice thereof to Noteholders, the Swap Counterparty and the Rating Agencies. ARTICLE IX TERMINATION SECTION 9.01 OPTIONAL PURCHASE OF ALL RECEIVABLES. (a) On each Payment Date following the last day of a Collection Period as of which the Pool Balance shall be less than the Optional Purchase Percentage (expressed as a seven-digit 57 decimal figure) multiplied by the Original Pool Balance, the Servicer, or any successor to the Servicer, shall have the option to purchase the corpus of the Owner Trust Estate (whether or not such assets then comprise all or a portion of the Trust Estate) for an amount equal to the Optional Purchase Price. To exercise such option, the Servicer, or any successor to the Servicer, shall notify the Swap Counterparty, the Owner Trustee and the Indenture Trustee of its intention to do so in writing, no later than the tenth day of the month preceding the month in which the Payment Date as of which such purchase is to be effected and shall, on or before the Payment Date on which such purchase is to occur, deposit pursuant to Section 5.05 in the Collection Account an amount equal to the Optional Purchase Price, and shall succeed to all interests in and to the Trust Estate and the Owner Trust Estate. Amounts so deposited will be paid and distributed as set forth in Section 5.06 of this Agreement. Upon such deposit of the amount necessary to purchase the corpus of the Owner Trust Estate, the Servicer shall for all purposes of this Agreement be deemed to have released all claims for reimbursement of Outstanding Advances made in respect of the Receivables. (b) Notice of any such purchase of the Owner Trust Estate shall be given by the Owner Trustee and the Indenture Trustee to each Securityholder and the Swap Counterparty as soon as practicable after their receipt of notice thereof from the Servicer. (c) Following the satisfaction and discharge of the Indenture and the payment in full of the principal of and interest on the Notes, the Certificateholder will succeed to the rights of the Noteholders under this Agreement other than Section 5.06 and the Owner Trustee will succeed to the rights of, and assume the obligations of, the Indenture Trustee provided for in this Agreement. (d) Upon the repurchase of any Receivable by the Seller or the Servicer, pursuant to any provision hereof (including Sections 3.02, 4.08 and 9.01(a)), the Owner Trustee on behalf of the Issuer and the Certificateholder, and the Indenture Trustee on behalf of the Noteholders, shall, without further action, be deemed to transfer, assign, set-over and otherwise convey to the Seller or the Servicer, as the case may be, all right, title and interest of the Owner Trustee on behalf of the Issuer in, to and under such repurchased Receivable, all monies due or to become due with respect thereto and all proceeds thereof and the other property conveyed to the Issuer hereunder pursuant to Section 2.01 with respect to such Receivable, and all security and any documents relating thereto, such assignment being an assignment outright and not for security; and the Seller or the Servicer, as applicable, shall thereupon own each such Receivable, and all such related security and documents, free of any further obligation to the Issuer, the Owner Trustee, the Certificateholder, the Indenture Trustee or the Noteholders with respect thereto. The Owner Trustee and Indenture Trustee shall execute such documents and instruments of transfer and assignment and take such other actions as shall be reasonably requested by the Seller or the Servicer, as the case may be, to effect the conveyance of such Receivable pursuant to this Section. If in any enforcement suit or legal proceeding it is held that the Seller or Servicer may not enforce a repurchased Receivable on the ground that it is not a real party in interest or a holder entitled to enforce the Receivable, the Owner Trustee on behalf of the Issuer and the Certificateholder, and the Indenture Trustee on behalf of the Noteholders shall, at the written direction and expense of the Seller or Servicer, as the case may be, take such reasonable steps as the Seller or Servicer deems necessary to enforce the Receivable, including bringing suit in the name or names of the Issuer, Certificateholder or Noteholders. 58 SECTION 9.02 TERMINATION OF THE TRUST AGREEMENT. The respective obligations and responsibilities of the Issuer, the Seller and the Servicer under this Agreement shall terminate upon the termination of the Trust Agreement pursuant to Article IX of the Trust Agreement. ARTICLE X MISCELLANEOUS SECTION 10.01 AMENDMENT. This Agreement may be amended by the Seller, the Servicer and the Issuer, with the consent of the Indenture Trustee, but without the consent of any of the Noteholders or the Certificateholder, to cure any ambiguity, to correct or supplement any provisions in this Agreement or for the purpose of adding any provisions to or changing in any manner or eliminating any of the provisions in this Agreement or of modifying in any manner the rights of the Noteholders or the Certificateholder; PROVIDED, HOWEVER, that such action shall not, as evidenced by an Opinion of Counsel delivered to the Owner Trustee and the Indenture Trustee, adversely affect in any material respect the interests of any Noteholder or Certificateholder. This Agreement may also be amended by the Seller, the Servicer and the Issuer, with the consent of the Indenture Trustee, but without the consent of any of the Noteholders or the Certificateholder for the purpose of changing the formula for determining the Specified Reserve Account Balance, the manner in which the Reserve Account is funded (i.e. to allow the deposit of cash therein by any Person, but not to change any order of priority of payments and distributions specified in Section 5.06 of the Sale and Servicing Agreement), changing the remittance schedule for the deposit of collections with respect to the Receivables in the Collection Account or Payahead Account pursuant to Section 5.02 hereof or changing the definition of Eligible Investment, in each case only if the Indenture Trustee and/or the Owner Trustee, as the case may be, (i) has received a letter from Standard & Poor's to the effect that Standard & Poor's will not qualify, reduce or withdraw the rating it has currently assigned to any Class of Notes as a result of such amendment and (ii) has provided Moody's with 10 days prior written notice of such amendment and Moody's shall not have notified the Indenture Trustee and/or the Owner Trustee, as the case may be, that such amendment might or would result in the qualification, reduction or withdrawal of the rating it has currently assigned to any Class of Notes; provided that no such amendment may increase or reduce in any manner or accelerate or delay the timing of collections on the Receivables or payments required to be made to Holders of any Class of Notes or of the Certificate without the consent of all Holders of each affected Class or the Certificateholder, if affected. This Agreement may also be amended from time to time by the Seller, the Servicer and the Issuer, with the consent of the Indenture Trustee, the consent of (A) if the interests of Indenture Trustee or the Noteholders are affected, the Holders of Notes evidencing not less than 51% of the outstanding Principal Balance of each affected Class of Notes, acting as a single Class but excluding for purposes of such calculation and action all Securities held or beneficially owned by TMCC, TAFR LLC or any of their Affiliates, (B) if the interests of the Issuer, Owner Trustee or Certificateholder are affected, the Holder of the Certificate and/or (C) if the interests of the Swap Counterparty are affected, the Swap Counterparty, for the purpose of adding any provisions to or changing in any manner or eliminating any of the provisions of this Agreement 59 or of modifying in any manner the rights of such Noteholders or of the Certificateholder; PROVIDED, HOWEVER, that no such amendment may (i) increase or reduce in any manner the amount of, or accelerate or delay the timing of, collections of payments on the related Receivables or payments required to be made to Holders of any Class of Notes or the Certificateholder without the consent of all Holders of each affected Class of Notes or the Certificateholder, as the case may be, or (ii) reduce the aforesaid percentage of the Notes or the aforesaid Certificateholder required to consent to any such amendment, without the consent of the Holders of each Class of Notes or of the Certificate, as the case may be, affected thereby. Promptly after the execution of any such amendment or consent, the Owner Trustee shall furnish written notification of the substance of such amendment or consent to each Certificateholder, the Indenture Trustee, the Swap Counterparty (unless TMCC or an Affiliate thereof is the Servicer and the Swap Counterparty at the time of delivery) and each of the Rating Agencies. It shall not be necessary for the consent of the Certificateholder or Noteholders pursuant to this Section to approve the particular form of any proposed amendment or consent, but it shall be sufficient if such consent shall approve the substance thereof. Prior to the execution of any amendment to this Agreement, the Owner Trustee and the Indenture Trustee shall be entitled to receive and rely upon an Opinion of Counsel stating that the execution of such amendment is authorized or permitted by this Agreement and the Opinion of Counsel referred to in Section 10.02. The Owner Trustee and the Indenture Trustee may, but shall not be obligated to, enter into any such amendment which affects the Owner Trustee's or the Indenture Trustee's, as applicable, own rights, duties or immunities under this Agreement or otherwise. SECTION 10.02 PROTECTION OF TITLE TO TRUST. (a) The Seller shall execute and file such financing statements and cause to be executed and filed such continuation statements, all in such manner and in such places as may be required by law fully to preserve, maintain and protect the interest of the Issuer and of the Indenture Trustee in the Receivables and in the proceeds thereof. The Seller shall deliver (or cause to be delivered) to the Owner Trustee and the Indenture Trustee file-stamped copies of, or filing receipts for, any document filed as provided above, as soon as available following such filing. (b) Neither the Seller nor the Servicer shall change its name, identity or corporate structure in any manner that would, could or might make any financing statement or continuation statement filed in accordance with paragraph (a) above seriously misleading within the meaning of Section 9-402(7) of the UCC, unless it shall have given the Owner Trustee and the Indenture Trustee at least five days' prior written notice thereof and shall have promptly filed appropriate amendments to all previously filed financing statements or continuation statements. (c) Each of the Seller and the Servicer shall have an obligation to give the Owner Trustee and the Indenture Trustee at least 60 days' prior written notice of any relocation of its principal executive office if, as a result of such relocation, the applicable provisions of the UCC 60 would require the filing of any amendment of any previously filed financing or continuation statement or of any new financing statement and shall promptly file any such amendment or new financing statement. The Servicer shall at all times maintain each office from which it shall service Receivables, and its principal executive office, within the United States of America. (d) The Servicer shall maintain accounts and records as to each Receivable accurately and in sufficient detail to permit (i) the reader thereof to know at any time the status of such Receivable, including payments and recoveries made and payments owing (and the nature of each) and (ii) reconciliation between payments or recoveries on (or with respect to) each Receivable and the amounts from time to time deposited in the Collection Account in respect of such Receivable. (e) The Servicer shall maintain its computer systems so that, from and after the time of sale under this Agreement of the Receivables, the Servicer's master computer records (including any backup archives) that refer to any Receivable shall indicate clearly the interest of the Issuer, the Owner Trustee and the Indenture Trustee in such Receivable and that such Receivable is owned by the Issuer and has been pledged to the Indenture Trustee. Indication of these respective interests in a Receivable shall be deleted from or modified on the Servicer's computer systems when, and only when, the related Receivable shall have become a Liquidated Receivable or been repurchased. (f) If at any time the Seller or the Servicer shall propose to sell, grant a security interest in, or otherwise transfer any interest in automotive receivables to, any prospective purchaser, lender or other transferee, the Servicer shall give to such prospective purchaser, lender or other transferee computer tapes, records or printouts (including any restored from backup archives) that, if they shall refer in any manner whatsoever to any Receivable, shall indicate clearly that such Receivable has been sold and is owned by the Issuer and has been pledged to the Indenture Trustee. (g) Upon request, the Servicer shall furnish to the Owner Trustee or to the Indenture Trustee, within five Business Days, a list of all Receivables (by contract number and name of Obligor) then held as part of the Owner Trust Estate, together with a reconciliation of such list to the Schedule of Receivables and to each of the Servicer's Certificates furnished before such request indicating removal of Receivables from the Owner Trust Estate. (h) The Servicer shall deliver to the Owner Trustee and the Indenture Trustee: (A) promptly after the execution and delivery of this Agreement and, if required pursuant to Section 10.01, of each amendment hereto, an Opinion of Counsel stating that, in the opinion of such counsel, either (A) all financing statements and continuation statements have been executed and filed that are necessary fully to preserve and protect the interest of the Owner Trustee and the Indenture Trustee in the Receivables, and reciting the details of such filings or referring to prior Opinions of Counsel in which such details are given, or (B) no such action shall be necessary to preserve and protect such interest, in each case also specifying any action necessary (as of the date of such opinion) to be taken in the following year to preserve and protect such interest; and 61 (B) within 90 days after the beginning of each calendar year beginning with the first calendar year beginning more than three months after the Cutoff Date, an Opinion of Counsel, dated as of a date during such 90-day period, stating that, in the opinion of such counsel, either (A) all financing statements and continuation statements have been executed and filed that are necessary fully to preserve and protect the interest of the Owner Trustee and the Indenture Trustee in the Receivables, and reciting the details of such filings or referring to prior Opinions of Counsel in which such details are given, or (B) no such action shall be necessary to preserve and protect such interest. SECTION 10.03 NOTICES. All demands, notices, communications and instructions upon or to the Seller, the Servicer, the Owner Trustee, the Indenture Trustee or the Rating Agencies under this Agreement shall be in writing, personally delivered or mailed by certified mail, return receipt requested, and shall be deemed to have been duly given upon receipt (a) in the case of the Servicer, to Toyota Motor Credit Corporation, 19001 S. Western Avenue, Torrance, California 90509, Attention: Vice President, Treasury, (310) 468-4001, (b) in the case of the Seller, to Toyota Auto Finance Receivables LLC, 19300 Gramercy Place, North Building, Torrance, California 90509, Attention: President, (310) 468-7333, (c) in the case of the Issuer or the Owner Trustee, at the Corporate Trust Office (as defined in the Trust Agreement), (d) in the case of the Indenture Trustee, at the Corporate Trust Office specified in the Indenture, (e) in the case of Moody's, to Moody's Investors Service, Inc., ABS Monitoring Department, 99 Church Street, New York, New York 10007, (f) in the case of Standard & Poor's, to Standard & Poor's Ratings Services, a division of The McGraw-Hill Companies, 55 Water Street, New York, New York 10041, Attention of Asset Backed Surveillance Department; or, as to each of the foregoing, at such other address as shall be designated by written notice to the other parties. SECTION 10.04 ASSIGNMENT BY THE SELLER OR THE SERVICER. Notwithstanding anything to the contrary contained herein, except as provided in Sections 6.04 and 7.03 of this Agreement and as provided in the provisions of this Agreement concerning the resignation or termination of the Servicer, this Agreement may not be assigned by the Seller or the Servicer. SECTION 10.05 LIMITATIONS ON RIGHTS OF OTHERS. The provisions of this Agreement are solely for the benefit of the Seller, the Servicer, the Issuer, the Owner Trustee, the Certificateholder, the Indenture Trustee and the Noteholders, and nothing in this Agreement, whether express or implied, shall be construed to give to any other Person any legal or equitable right, remedy or claim in the Owner Trust Estate or under or in respect of this Agreement or any covenants, conditions or provisions contained herein. SECTION 10.06 SEVERABILITY. Any provision of this Agreement that is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof, and any such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction. SECTION 10.07 SEPARATE COUNTERPARTS. This Agreement may be executed by the parties hereto in separate counterparts, each of which when so executed and delivered shall be an original, but all such counterparts shall together constitute but one and the same instrument. 62 SECTION 10.08 HEADINGS. The headings of the various Articles and Sections herein are for convenience of reference only and shall not define or limit any of the terms or provisions hereof. SECTION 10.09 GOVERNING LAW. This Agreement shall be construed in accordance with the laws of the State of California, without reference to its conflict of law provisions, and the obligations, rights and remedies of the parties hereunder shall be determined in accordance with such laws. SECTION 10.10 ASSIGNMENT BY ISSUER. The Seller hereby acknowledges and consents to any mortgage, pledge, assignment and grant of a security interest by the Issuer to the Indenture Trustee pursuant to the Indenture for the benefit of the Noteholders of all right, title and interest of the Issuer in, to and under the Receivables and/or the assignment of any or all of the Issuer's rights and obligations hereunder or under the Interest Rate Swap Agreement to the Indenture Trustee. SECTION 10.11 NONPETITION COVENANTS. (a) Notwithstanding any prior termination of this Agreement, the Servicer and the Seller shall not, prior to the date which is one year and one day after the termination of this Agreement with respect to the Issuer, acquiesce, petition or otherwise invoke or cause the Issuer to invoke the process of any court or government authority for the purpose of commencing or sustaining a case against the Issuer under any federal or state bankruptcy, insolvency or similar law, or appointing a receiver, liquidator, assignee, trustee, custodian, sequestrator or other similar official of the Issuer or any substantial part of its property, or ordering the winding up or liquidation of the affairs of the Issuer. (b) Notwithstanding any prior termination of this Agreement, the Servicer shall not, prior to the date which is one year and one day after the termination of this Agreement with respect to the Seller, acquiesce, petition or otherwise invoke or cause the Seller to invoke the process of any court or government authority for the purpose of commencing or sustaining a case against the Seller under any federal or state bankruptcy, insolvency or similar law, appointing a receiver, liquidator, assignee, trustee, custodian, sequestrator or other similar official of the Seller or any substantial part of its property, or ordering the winding up or liquidation of the affairs of the Seller. SECTION 10.12 LIMITATION OF LIABILITY OF OWNER TRUSTEE AND INDENTURE TRUSTEE. Notwithstanding anything contained herein to the contrary, this Agreement has been countersigned by First Union Trust Company, National Association, not in its individual capacity, but solely in its capacity as Owner Trustee on behalf of the Issuer, and by Wells Fargo Bank Minnesota, National Association, not in its individual capacity, but solely in its capacity as Indenture Trustee under the Indenture. In no event shall First Union Trust Company, National Association in its individual capacity or Wells Fargo Bank Minnesota, National Association in its individual capacity have any liability for the representations, warranties, covenants, agreements or other obligations of the Issuer hereunder or in any of the certificates, notices or agreements delivered by the Seller or Servicer, or prepared by the Seller or Servicer for delivery 63 by the Owner Trustee on behalf of the Issuer, pursuant hereto, as to all of which recourse shall be had solely to the assets of the Issuer. For all purposes of this Agreement, in the performance of its duties or obligations hereunder or in the performance of any duties or obligations of the Issuer hereunder, the Owner Trustee shall be subject to, and entitled to the benefits of, the terms and provisions of Articles VI, VII and VIII of the Trust Agreement. 64 IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed by their respective officers as of the day and year first above written. TOYOTA AUTO RECEIVABLES 2001-B OWNER TRUST By: First Union Trust Company, National Association, not in its individual capacity but solely as Owner Trustee on behalf of the Issuer By: /s/ Sterling C. Correia ----------------------------------------------- Name: Sterling C. Correia Title: Vice President TOYOTA AUTO FINANCE RECEIVABLES LLC, Seller By: /s/ Lloyd Mistele ----------------------------------------------- Name: Lloyd Mistele Title: President TOYOTA MOTOR CREDIT CORPORATION, Servicer By: /s/ George E. Borst ----------------------------------------------- Name: George E. Borst Title: President and Chief Executive Officer ACKNOWLEDGED AND ACCEPTED AS OF THE DAY AND YEAR FIRST ABOVE WRITTEN: WELLS FARGO BANK MINNESOTA, NATIONAL ASSOCIATION, not in its individual capacity but solely as Indenture Trustee By: /s/ Marianna Stershic --------------------------------------------------- Name: Marianna C. Stershic Title: Vice President S-1 SCHEDULE A Schedule of Receivables (Omitted - Originals on file at the office of the Seller and Owner Trustee) SA-1 EXHIBIT A Form of Servicer's Certificate (SEE ATTACHED) A-1 EX-4.2 3 a2049889zex-4_2.txt EXHIBIT 4.2 EXHIBIT 4.2 INDENTURE -------------------------------------------------------------- TOYOTA AUTO RECEIVABLES 2001-B OWNER TRUST, as Issuer and WELLS FARGO BANK MINNESOTA, NATIONAL ASSOCIATION as Indenture Trustee and Securities Intermediary -------------------------------------------------------------- Dated as of April 1, 2001 TABLE OF CONTENTS
PAGE ---- ARTICLE I DEFINITIONS AND INCORPORATION BY REFERENCE Section 1.01 Definitions.........................................................2 Section 1.02 Usage of Terms......................................................9 Section 1.03 Incorporation by Reference of Trust Indenture Act..................10 ARTICLE II THE NOTES Section 2.01 Form...............................................................10 Section 2.02 Execution, Authentication and Delivery.............................11 Section 2.03 Temporary Notes....................................................11 Section 2.04 Registration; Registration of Transfer and Exchange................11 Section 2.05 Mutilated, Destroyed, Lost or Stolen Notes.........................13 Section 2.06 Persons Deemed Owners..............................................14 Section 2.07 Payments of Principal and Interest.................................14 Section 2.08 Cancellation.......................................................15 Section 2.09 Release of Collateral..............................................15 Section 2.10 Book-Entry Notes...................................................15 Section 2.11 Notices to Clearing Agency.........................................16 Section 2.12 Definitive Notes...................................................16 Section 2.13 Tax Treatment......................................................17 ARTICLE III COVENANTS Section 3.01 Payments to Noteholders, Certificateholder, Swap Counterparty, Servicer and Seller................................................17 Section 3.02 Maintenance of Office or Agency....................................18 Section 3.03 Money for Payments To Be Held in Trust.............................18 Section 3.04 Existence..........................................................20 Section 3.05 Protection of Trust Estate.........................................20 Section 3.06 Opinions as to Trust Estate........................................20 Section 3.07 Performance of Obligations; Servicing of Receivables...............21 Section 3.08 Negative Covenants.................................................23 Section 3.09 Annual Statement as to Compliance..................................24 i Section 3.10 Issuer May Consolidate, etc., Only on Certain Terms................24 Section 3.11 Successor or Transferee............................................26 Section 3.12 No Other Business..................................................26 Section 3.13 No Borrowing.......................................................26 Section 3.14 Servicer's Notice Obligations......................................26 Section 3.15 Guarantees, Loans, Advances and Other Liabilities..................26 Section 3.16 Capital Expenditures...............................................27 Section 3.17 Removal of Administrator...........................................27 Section 3.18 Restricted Payments................................................27 Section 3.19 Notice of Events of Default........................................27 Section 3.20 Further Instruments and Actions....................................27 ARTICLE IV SATISFACTION AND DISCHARGE Section 4.01 Satisfaction and Discharge of Indenture............................27 Section 4.02 Application of Trust Money.........................................28 Section 4.03 Repayment of Moneys Held by Paying Agent...........................29 ARTICLE V REMEDIES Section 5.01 Events of Default..................................................29 Section 5.02 Acceleration of Maturity; Rescission and Annulment.................31 Section 5.03 Collection of Indebtedness and Suits for Enforcement by Indenture Trustee..................................................32 Section 5.04 Remedies; Priorities; Insolvency of Seller.........................34 Section 5.05 Optional Preservation of the Receivables...........................36 Section 5.06 Limitation of Suits................................................36 Section 5.07 Unconditional Rights of Noteholders To Receive Principal and Interest.............................................37 Section 5.08 Restoration of Rights and Remedies.................................37 Section 5.09 Rights and Remedies Cumulative.....................................37 Section 5.10 Delay or Omission Not a Waiver.....................................37 Section 5.11 Control by Noteholders.............................................37 ii Section 5.12 Waiver of Past Defaults............................................38 Section 5.13 Undertaking for Costs..............................................38 Section 5.14 Waiver of Stay or Extension Laws...................................39 Section 5.15 Action on Notes....................................................39 Section 5.16 Performance and Enforcement of Certain Obligations.................39 ARTICLE VI THE INDENTURE TRUSTEE Section 6.01 Duties of Indenture Trustee........................................40 Section 6.02 Rights of Indenture Trustee........................................41 Section 6.03 Individual Rights of Indenture Trustee.............................42 Section 6.04 Indenture Trustee's Disclaimer.....................................42 Section 6.05 Notice of Defaults.................................................43 Section 6.06 Reports by Indenture Trustee to Holders............................43 Section 6.07 Compensation and Indemnity.........................................44 Section 6.08 Replacement of Indenture Trustee...................................44 Section 6.09 Successor Indenture Trustee by Merger..............................45 Section 6.10 Appointment of Co-Indenture Trustee or Separate Indenture Trustee..................................................46 Section 6.11 Eligibility; Disqualification......................................47 Section 6.12 Preferential Collection of Claims Against Issuer...................47 Section 6.13 [Reserved].........................................................47 Section 6.14 Interest Rate Swap Provisions......................................47 ARTICLE VII NOTEHOLDERS' LISTS AND REPORTS Section 7.01 Note Registrar To Furnish Names and Addresses of Noteholders.......48 Section 7.02 Preservation of Information; Communications to Noteholders.........49 Section 7.03 Reports by Issuer..................................................49 Section 7.04 Reports by Indenture Trustee.......................................50 ARTICLE VIII ACCOUNTS, DISBURSEMENTS AND RELEASES Section 8.01 Collection of Money................................................50 Section 8.02 Trust Accounts.....................................................50 iii Section 8.03 [Reserved].........................................................51 Section 8.04 General Provisions Regarding Accounts..............................51 Section 8.05 Release of Trust Estate............................................52 Section 8.06 Opinion of Counsel.................................................53 ARTICLE IX SUPPLEMENTAL INDENTURES Section 9.01 Supplemental Indentures Without Consent of Noteholders.............53 Section 9.02 Supplemental Indentures with Consent of Noteholders................54 Section 9.03 Limitations on Supplemental Indentures.............................54 Section 9.04 Execution of Supplemental Indentures...............................55 Section 9.05 Effect of Supplemental Indenture...................................56 Section 9.06 Conformity with Trust Indenture Act................................56 Section 9.07 Reference in Notes to Supplemental Indentures......................56 ARTICLE X TERMINATION OF THE TRUST Section 10.01 Termination of the Trusts Created by Indenture.....................56 Section 10.02 Optional Purchase of All Receivables...............................57 ARTICLE XI MISCELLANEOUS Section 11.01 Compliance Certificates and Opinions, etc..........................58 Section 11.02 Form of Documents Delivered to Indenture Trustee...................59 Section 11.03 Acts of Noteholders................................................60 Section 11.04 Notices, etc., to Indenture Trustee, Issuer and Rating Agencies....60 Section 11.05 Notices to Noteholders; Waiver.....................................61 Section 11.06 Alternate Payment and Notice Provisions............................61 Section 11.07 Conflict with Trust Indenture Act..................................61 Section 11.08 Effect of Headings and Table of Contents...........................62 Section 11.09 Successors and Assigns.............................................62 Section 11.10 Severability.......................................................62 Section 11.11 Benefits of Indenture..............................................62 Section 11.12 Governing Law......................................................62 Section 11.13 Counterparts.......................................................62 iv Section 11.14 Recording of Indenture.............................................62 Section 11.15 Trust Obligation...................................................63 Section 11.16 No Petition........................................................63 Section 11.17 Inspection.........................................................63
EXHIBIT A - Forms of Class A-1 Note, Class A-2 Note, Class A-3 Note and Class A-4 Note EXHIBIT B - Form of Note Depository Agreement v CROSS-REFERENCE TABLE (not a part of this Indenture)
TIA Indenture SECTION Section - ------- ------- (Section)310(a)(1).................................................................... 6.11 (a)(2).......................................................................... 6.11 (a)(3).......................................................................... N.A. (a)(4).......................................................................... N.A. (a)(5).......................................................................... 6.11 (b)............................................................................. 5.04 6.08 6.11 11.04 (c) ............................................................................ N.A. (Section)311(a) ...................................................................... 6.12 (b) ............................................................................ 6.12 (c) ............................................................................ N.A. (Section)312(a) ...................................................................... 7.02 (b) ............................................................................ 7.02 (c) ............................................................................ 7.02 (Section)313(a) ...................................................................... 7.04 (b)(1).......................................................................... N.A. (b)(2).......................................................................... 7.04 (c) ............................................................................ 7.04 11.04 (d) ............................................................................ 7.04 (Section)314(a) ...................................................................... 3.09 7.03 11.04 (b) ............................................................................11.14 (c)(1) ......................................................................... 3.10 6.02 8.05(b) 6.02 11.01 (c)(2).......................................................................... 3.06 3.10 6.02 8.05(b) 8.06 (c)(3).......................................................................... N.A. (d) ............................................................................ N.A. (d) ............................................................................ N.A. (e) ........................................................................... 11.05 (f) ........................................................................... 4.01. (Section)315(a) ...................................................................... 6.01 (b) ............................................................................ 6.05 (c) ............................................................................ 5.02 5.08 (d) ......................................................................... 6.01(c) (e) ............................................................................ 5.13 (Section)316(a)(last sentence).................................................... 6.01(c) (a)(1)(A)................................................................... 6.01(c) (a)(1)(B)...................................................................... 5.12 (a)(2)......................................................................... N.A. (b) ........................................................................... 5.01 5.04(b) (c) ........................................................................... 2.06 (Section)317(a)(1) .................................................................. 5.04 (a)(2) ..................................................................... 5.03(c) 5.03(d) (b) ........................................................................... 4.03 (Section)318(a) ..................................................................... 11.07
- --------- N.A. means not applicable INDENTURE dated as of April 1, 2001, between TOYOTA AUTO RECEIVABLES 2001-B OWNER TRUST, a Delaware business trust (the "Issuer"), and WELLS FARGO BANK MINNESOTA, NATIONAL ASSOCIATION, a national banking association, as trustee and not in its individual capacity and as Securities Intermediary (the "Indenture Trustee"). Each party agrees as follows for the benefit of the other party and for the equal and ratable benefit of the Holders of the Issuer's 4.300% Asset Backed Notes, Class A-1 (the "Class A-1 Notes"), Floating Rate Asset Backed Notes, Class A-2 (the "Class A-2 Notes"), Floating Rate Asset Backed Notes, Class A-3 (the "Class A-3 Notes") and Floating Rate Asset Backed Notes, Class A-4 (the "Class A-4 Notes," and together with the Class A-1 Notes, the Class A-2 Notes and the Class A-3 Notes, the "Class A Notes" or the "Notes"): GRANTING CLAUSE The Issuer hereby Grants to the Indenture Trustee at the Closing Date, as Indenture Trustee for the benefit of the Holders of the Notes and the Certificate and the Swap Counterparty, all of the Issuer's right, title and interest in and to, in each case whether now or hereafter existing or in which Issuer now has or hereafter acquires an interest and wherever the same may be located: (i) all right, title and interest of the Issuer in and to the Receivables and all monies due thereon or paid thereunder or in respect thereof (including proceeds of the repurchase of Receivables by the Seller pursuant to Section 3.02 or the purchase of Receivables by the Servicer pursuant to Section 4.08 or 9.01 of the Sale and Servicing Agreement) on or after the Cutoff Date; (ii) the interest of the Issuer in the security interests in the Financed Vehicles granted by the Obligors pursuant to the Receivables and any accessions thereto; (iii) the interest of the Issuer in any proceeds of any physical damage insurance policies covering Financed Vehicles and in any proceeds of any credit life or credit disability insurance policies relating to the Receivables or the Obligors; (iv) the interest of the Issuer in any Dealer Recourse; (v) the right of the Issuer to realize upon any property (including the right to receive future Liquidation Proceeds) that shall have secured a Receivable and have been repossessed by or on behalf of the Issuer; (vi) the rights and interests of the Issuer under the Sale and Servicing Agreement and as assignee (pursuant to the Sale and Servicing Agreement) of the rights and interests of TAFR LLC under the Receivables Purchase Agreement; (vii) all rights, title and interest of the Issuer in and to the Interest Rate Swap Agreement and; (viii) all other assets comprising the Owner Trust Estate; (ix) all proceeds of the foregoing and (x) all present and future claims, demands, causes of action and choses in action in respect of any or all of the foregoing and all payments on or under of every kind and nature whatsoever in respect of any or all of the foregoing, including all proceeds of the conversion thereof, voluntary or involuntary, into cash or other liquid property, all cash proceeds, accounts, accounts receivable, notes, drafts, acceptances, chattel paper, checks, deposit accounts, insurance proceeds, condemnation awards, rights to payment of any and every kind and other forms of obligations and receivables, instruments and other property which at any time constitute all or part of or are included in the proceeds of any of the foregoing (collectively, the "Collateral"). The foregoing Grant is made in trust to secure the payment of principal of and interest on, and any other amounts owing in respect of, the Notes, equally and ratably without prejudice, priority or distinction, and to secure compliance with the provisions of this Indenture, and subject 1 to the subordinate claims thereon of the Holder of the Certificate, all as provided in this Indenture. The Indenture Trustee, as Indenture Trustee on behalf of the Holders of the Notes and for the benefit of the Certificateholder, acknowledges such Grant, accepts the trusts under this Indenture in accordance with the provisions of this Indenture and agrees to perform its duties required in this Indenture to the best of its ability to the end that the interests of the Holders of the Notes may be adequately and effectively protected and the rights of the Certificateholder secured. ARTICLE I DEFINITIONS AND INCORPORATION BY REFERENCE SECTION 1.01 DEFINITIONS. Except as otherwise specified herein or as the context may otherwise require, capitalized terms used but not otherwise defined herein have the meanings ascribed thereto in the Trust Agreement, the Sale and Servicing Agreement, the Interest Rate Swap Agreement and Securities Account Control Agreement, as the case may be, for all purposes of this Indenture. Except as otherwise provided in this Agreement, whenever used herein the following words and phrases, unless the context otherwise requires, shall have the following meanings: "ACTION" has the meaning specified in Section 11.03(a). "ADMINISTRATION AGREEMENT" means the Administration Agreement dated as of April 1, 2001, among the Administrator, the Issuer and the Indenture Trustee. "ADMINISTRATOR" means TMCC, or any successor Administrator under the Administration Agreement. "AUTHORIZED OFFICER" means (i) with respect to the Issuer, any officer of the Owner Trustee who is authorized to act for the Owner Trustee in matters relating to the Issuer identified as such on any list of Authorized Officers delivered by the Owner Trustee to the Indenture Trustee and (ii) with respect to the Administrator, any Vice President or more senior officer of the Administrator who is authorized to act for the Administrator in matters relating to the Issuer and identified as such on any list of Authorized Officers delivered by the Administrator to the Indenture Trustee. "BOOK-ENTRY NOTES" means a beneficial interest in the Class A-2 Notes, Class A-3 Notes and Class A-4 Notes, ownership and transfers of which shall be made through book entries by a Clearing Agency as described in Section 2.10. "BUSINESS DAY" means any day other than a Saturday, a Sunday or a day on which banking institutions or trust companies in New York, New York, Minneapolis, Minnesota, Wilmington, Delaware or San Francisco, California are authorized or obligated by law, regulation or executive order to remain closed. 2 "CLASS A-1 RATE" means 4.300% per annum (computed on the basis of the actual number of days elapsed during the relevant Interest Period and a 360-day year). "CLASS A-1 NOTES" means the 4.300% Asset Backed Notes, Class A-1, substantially in the form attached hereto as Exhibit A. "CLASS A-2 RATE" means, with respect to any Payment Date, one-month LIBOR plus 0.060% (computed on the basis of the actual number of days elapsed during the relevant Interest Period and a 360-day year). "CLASS A-2 NOTES" means the Floating Rate Asset Backed Notes, Class A-2, substantially in the form attached hereto as Exhibit A. "CLASS A-3 RATE" means, with respect to any Payment Date, one-month LIBOR plus 0.080% (computed on the basis of the actual number of days elapsed during the relevant Interest Period and a 360-day year). "CLASS A-3 NOTES" means the Floating Rate Asset Backed Notes, Class A-3, substantially in the form attached hereto as Exhibit A. "CLASS A-4 RATE" means, with respect to any Payment Date, one-month LIBOR plus 0.100% (computed on the basis of the actual number of days elapsed during the relevant Interest Period and a 360-day year). "CLASS A-4 NOTES" means the Floating Rate Asset Backed Notes, Class A-4, substantially in the form attached hereto as Exhibit A. "CLEARING AGENCY" means an organization registered as a "clearing agency" pursuant to Section 17A of the Exchange Act. "CLEARING AGENCY PARTICIPANT" means a broker, dealer, bank, other financial institution or other Person for whom from time to time a Clearing Agency effects book-entry transfers and pledges of securities deposited with the Clearing Agency. "CLOSING DATE" means May 15, 2001. "CODE" means the Internal Revenue Code of 1986, as amended, and the Treasury Regulations promulgated thereunder. "COLLATERAL" has the meaning specified in the Granting Clause of this Indenture. "CORPORATE TRUST OFFICE" means the principal office of the Indenture Trustee at which at any particular time its corporate trust business shall be administered, which office at the date of execution of this Agreement is located at Sixth and Marquette, MAC: N9311-161, Minneapolis, Minnesota, 55479, Attn: Asset Backed Securities Department, or at such other address as the Indenture Trustee may designate from time to time by notice to the Noteholders, the Issuer and the Administrator, or the principal corporate trust office of any successor Indenture Trustee at the 3 address designated by such successor Indenture Trustee by notice to the Noteholders, the Issuer and the Administrator. "DEFAULT" means any occurrence that is, or with notice or the lapse of time or both would become, an Event of Default. "DEFINITIVE NOTES" has the meaning specified in Section 2.10. "EVENT OF DEFAULT" has the meaning specified in Section 5.01. "EXCHANGE ACT" means the Securities Exchange Act of 1934, as amended. "EXECUTIVE OFFICER" means, with respect to any corporation, the Chief Executive Officer, Chief Operating Officer, Chief Financial Officer, President, Executive Vice President, any Vice President, the Secretary or the Treasurer of such corporation; and with respect to any partnership, any general partner thereof. "GRANT" means mortgage, pledge, bargain, sell, warrant, alienate, remise, release, convey, assign, transfer, create, and grant a lien upon and a security interest in and right of set-off against, deposit, set over and confirm pursuant to this Indenture. A Grant of the Collateral or of any other agreement or instrument shall include all rights, powers and options (but none of the obligations) of the granting party thereunder, including the immediate and continuing right to claim for, collect, receive and give receipt for principal and interest payments in respect of the Collateral and all other moneys payable thereunder, to give and receive notices and other communications, to make waivers or other agreements, to exercise all rights and options, to bring Proceedings in the name of the granting party or otherwise, and generally to do and receive anything that the granting party is or may be entitled to do or receive thereunder or with respect thereto. "HOLDER" or "NOTEHOLDER" means the Person in whose name a Note is registered on the Note Register. "INDENTURE TRUSTEE" means Wells Fargo Bank Minnesota, National Association, a national banking association, as Indenture Trustee under this Indenture, or any successor Indenture Trustee under this Indenture. "INDEPENDENT" means, when used with respect to any specified Person, that the Person is in fact independent of the Seller, the Servicer, the Administrator, the Issuer or any other obligor on the Notes or any Affiliate of any of the foregoing Persons because, among other things, such Person (a) is not an employee, officer or director or otherwise controlled thereby or under common control therewith, (b) does not have any direct financial interest or any material indirect financial interest therein (whether as holder of securities thereof or party to contract therewith or otherwise) and (c) is not and has not within the preceding twelve months been a promoter, underwriter, trustee, partner, director or person performing similar functions therefor or otherwise had legal, contractual or fiduciary or other duties to act on behalf of or for the benefit thereof. "INDEPENDENT CERTIFICATE" means a certificate or opinion to be delivered to the Indenture Trustee under the circumstances described in Section 11.01, made by an Independent appraiser 4 or other expert appointed by an Issuer Order and approved by the Indenture Trustee in the exercise of reasonable care, and such opinion or certificate shall state that the signer has read the definition of "Independent" in this Indenture and that the signer is Independent within the meaning thereof. "INSOLVENCY EVENT" with respect to the Seller means the filing of a decree or order for relief by a court having jurisdiction in the premises in respect of the Seller in an involuntary case under any applicable federal or state bankruptcy, insolvency or other similar law now or hereafter in effect, or appointing a receiver, liquidator, assignee, custodian, trustee, sequestrator or similar official of the Seller, or ordering the winding-up or liquidation of the Seller's affairs, and such decree or order shall remain unstayed and in effect for a period of 60 consecutive days; or the commencement by the Seller of a voluntary case under any applicable federal or state bankruptcy, insolvency or other similar law now or hereafter in effect, or the consent by the Seller to the entry of an order for relief in an involuntary case under any such law, or the consent by the Seller to the appointment or taking possession by a receiver, liquidator, assignee, custodian, trustee, sequestrator or similar official of the Seller, or the making by the Seller of any general assignment for the benefit of creditors, or the failure by the Seller generally to pay its debts as such debts become due, or the taking of any action by the Seller in furtherance of any of the foregoing. "INTEREST PERIOD" means, with respect to the Class A-1 Notes, the Class A-2 Notes, the Class A-3 Notes and the Class A-4 Notes, the period from (and including) any Payment Date to (but excluding) the next Payment Date, except that the first interest period will be from (and including) the Closing Date to (but excluding) June 15, 2001. "INTEREST RATE" means the Class A-1 Rate, the Class A-2 Rate, the Class A-3 Rate or the Class A-4 Rate, as indicated by the context. "INTEREST DETERMINATION DATE" means the second London Banking Day prior to the Interest Reset Date for the related Interest Period. "INTEREST RATE SWAP AGREEMENT" means 1992 ISDA Master Agreement dated as of May 15, 2001 (the "1992 ISDA Master Agreement"), including all schedules and confirmations thereto, between the Issuer and the Swap Counterparty, as the same may be amended, supplemented, renewed, extended or replaced from time to time. "ISSUER" means Toyota Auto Receivables 2001-B Owner Trust unless and until a successor replaces it and, thereafter, means the successor and, for purposes of any provision contained herein and required by the TIA, each other obligor on the Notes, if any. "ISSUER ORDER" and "ISSUER REQUEST" mean a written order or request signed in the name of the Issuer by any one of its Authorized Officers and delivered to the Indenture Trustee. "LIBOR" means the rate for deposits in U.S. dollars for a one-month period which appears on the Telerate Page 3750 as of 11:00 a.m., London time, on the Interest Determination Date; provided that, the following procedures will be followed if LIBOR cannot be determined as described above: 5 (a) With respect to an Interest Determination Date on which no rate appears on Telerate Page 3750, LIBOR for the applicable Interest Determination Date will be the rate calculated by the Calculation Agent (as defined in the Interest Rate Swap Agreement) as the arithmetic mean of at least two quotations obtained by the Calculation Agent after requesting the principal London offices of each of four major reference banks in the London interbank market, which may include the Calculation Agent and its affiliates, as selected by the Calculation Agent, to provide the Calculation Agent with its offered quotation for deposits in U.S. dollars for a one-month period, commencing on the second London Banking Day immediately following the applicable Interest Determination Date, to prime banks in the London interbank market at approximately 11:00 a.m., London time, on such Interest Determination Date and in a principal amount that is representative for a single transaction in U.S. dollars in that market at that time. If at least two such quotations are provided, LIBOR determined on the applicable Interest Determination Date will be the arithmetic mean of the quotations. (b) If fewer than two quotations referred to in clause (a) above are provided, LIBOR determined on the applicable Interest Determination Date will be the rate calculated by the Calculation Agent as the arithmetic mean of the rates quoted at approximately 11:00 a.m. in New York on the applicable Interest Determination Date by three major banks, which may include the Calculation Agent and its affiliates, in New York, selected by the Calculation Agent for loans in U.S. dollars to leading European banks, having a maturity of one-month and in a principal amount that is representative for a single transaction in U.S. dollars in that market at that time. (c) If the banks so selected by the Calculation Agent are not quoting as mentioned in clause (b) above, LIBOR for the applicable Interest Determination Date will be LIBOR in effect on the applicable Interest Determination Date. "NOTE" means a Class A-1 Note, a Class A-2 Note, a Class A-3 Note or a Class A-4 Note. "NOTE DEPOSITORY AGREEMENT" means the agreement entitled "Letter of Representations" dated on or before the Closing Date among the Clearing Agency, the Issuer and the Indenture Trustee with respect to certain matters relating to the duties thereof with respect to the Book-Entry Notes, substantially in the form attached hereto as Exhibit B. "NOTE OWNER" means, with respect to a Book-Entry Note, any Person who is the beneficial owner of such Book-Entry Note, as reflected on the books of the Clearing Agency or on the books of a Person maintaining an account with such Clearing Agency (directly as a Clearing Agency Participant or as an indirect participant, in each case in accordance with the rules of such Clearing Agency). "NOTE REGISTER" means the Register of Noteholders' information maintained by the Note Registrar pursuant to Section 2.04. "NOTE REGISTRAR" means the Indenture Trustee unless and until a successor Note Registrar shall have been appointed pursuant to Section 2.04. 6 "OFFICER'S CERTIFICATE" means a certificate signed by any Authorized Officer of the Issuer, under the circumstances described in, and otherwise complying with, the applicable requirements of Section 11.01, and delivered to the Indenture Trustee. "OPINION OF COUNSEL" means one or more written opinions of counsel who may, except as otherwise expressly provided in this Indenture, be an employee of or counsel to the Issuer, the Seller or the Servicer and which counsel shall be satisfactory to the Owner Trustee, the Indenture Trustee or the Rating Agencies, as the case may be. "OUTSTANDING" means, as of the date of determination, all Notes theretofore authenticated and delivered under this Indenture except: (a) Notes theretofore canceled by the Note Registrar or delivered to the Note Registrar for cancellation; (b) Notes or portions thereof the payment for which money in the necessary amount has been theretofore deposited with the Indenture Trustee or any Paying Agent in trust for the Holders of such Notes; and (c) Notes in exchange for or in lieu of which other Notes have been authenticated and delivered pursuant to this Indenture unless proof satisfactory to the Indenture Trustee is presented that any such Notes are held by a bona fide purchaser; provided, that in determining whether the Holders of the requisite percentage of the Outstanding Amount of the Notes, or any Class of Notes, have given any request, demand, authorization, direction, notice, consent, or waiver hereunder or under any Basic Document, Notes owned by the Issuer, any other obligor upon the Notes, the Seller or any Affiliate of any of the foregoing Persons shall be disregarded and deemed not to be Outstanding, except that, in determining whether the Indenture Trustee shall be protected in relying upon any such request, demand, authorization, direction, notice, consent, or waiver, only Notes that the Indenture Trustee knows to be so owned shall be so disregarded. Notes so owned that have been pledged in good faith may be regarded as Outstanding if the pledgee establishes to the satisfaction of the Indenture Trustee the pledgee's right so to act with respect to such Notes and that the pledgee is not the Issuer, any other obligor upon the Notes, the Seller or any Affiliate of any of the foregoing Persons. "OUTSTANDING AMOUNT" means the aggregate principal amount of all Notes, or, if indicated by the context, all Notes of any Class, Outstanding at the date of determination. "OWNER TRUSTEE" means First Union Trust Company, National Association, not in its individual capacity but solely as Owner Trustee under the Trust Agreement, or any successor Owner Trustee under the Trust Agreement. "OWNER TRUST ESTATE" means all right, title and interest of the Issuer in and to the property and rights assigned to the Issuer pursuant to Article II of the Sale and Servicing Agreement, all funds on deposit from time to time in the accounts created pursuant to Section 5.01 of the Sale and Servicing Agreement (excluding any net investment income with respect to amounts held in such accounts) and all other property of the Issuer from time to time, including any rights of the Owner Trustee and the Issuer pursuant to the Sale and Servicing Agreement and the 7 Administration Agreement, and as assignee of the rights and Interests of the Depositor under the Receivables Purchase Agreement. "PAYING AGENT" means the Indenture Trustee or any other Person that meets the eligibility standards for the Indenture Trustee specified in Section 6.11 that has been authorized by the Issuer to make payments to and distributions from the Collection Account and the Payahead Account, including payment of principal of or interest on the Notes on behalf of the Issuer. "PREDECESSOR NOTE" means, with respect to any particular Note, every previous Note evidencing all or a portion of the same debt as that evidenced by such particular Note; and, for the purpose of this definition, any Note authenticated and delivered under Section 2.05 in lieu of a mutilated, lost, destroyed or stolen Note shall be deemed to evidence the same debt as the mutilated, lost, destroyed or stolen Note. "PROCEEDING" means any suit in equity, action at law or other judicial or administrative proceeding. "REGISTERED HOLDER" means the Person in whose name a Note is registered on the Note Register on the applicable Record Date. "SALE AND SERVICING AGREEMENT" means the Sale and Servicing Agreement dated as of April 1, 2001, among the Issuer, Toyota Auto Finance Receivables LLC, as Seller, and Toyota Motor Credit Corporation, as Servicer, and as to which the Indenture Trustee is a third party beneficiary of certain provisions. "SECURITIES ACT" means the Securities Act of 1933, as amended. "SECURITIES ACCOUNT CONTROL AGREEMENT" shall have the meaning ascribed thereto in the Sale and Servicing Agreement. "SELLER" shall mean Toyota Auto Finance Receivables LLC, in its capacity as seller under the Sale and Servicing Agreement, and its successor in interest. "SERVICER" shall mean Toyota Motor Credit Corporation in its capacity as servicer under the Sale and Servicing Agreement, and any Successor Servicer thereunder. "SUCCESSOR SERVICER" has the meaning specified in Section 3.07(e). "SWAP COUNTERPARTY" shall mean Toyota Motor Credit Corporation, as swap counterparty under the Interest Rate Swap Agreement, or any successor or replacement swap counterparty from time to time under the Interest Rate Swap Agreement. "SWAP EVENT OF DEFAULT" means (i) the failure of the Issuer or the Swap Counterparty to pay any amount when due under the Interest Rate Swap Agreement after giving effect to any applicable grace period; (ii) the occurrence of certain events of insolvency or bankruptcy of the Issuer or the Swap Counterparty as specified in the Interest Rate Swap Agreement and (iii) certain other standard events of default under the 1992 ISDA Master Agreement as specified in the Interest Rate Swap Agreement including "Breach of Agreement" (not applicable to the 8 Issuer), "Misrepresentation" (not applicable to the Issuer) and "Merger without Assumption," as described in Sections 5(a)(ii), 5(a)(iv) and 5(a)(viii) of the 1992 ISDA Master Agreement. "SWAP PAYMENTS INCOMING" means on any Payment Date the net amount, if any, then payable by a Swap Counterparty to the Issuer, excluding any Swap Termination Payments. "SWAP PAYMENTS OUTGOING" means on any payment Date the net amount, if any, then payable by the Issuer to the Swap Counterparty, excluding any Swap Termination Payments. "SWAP TERMINATION EVENT" means (i) certain events of insolvency of bankruptcy of the Issuer or the Swap Counterparty as specified in the Interest Rate Swap Agreement; (ii) any Event of Default under the Indenture that results in the acceleration of the Notes or involving an uncured payment default; (iii) the Issuer or Swap Counterparty becomes subject to registration as an "investment company" under the Investment Company Act of 1940; and (iv) certain standard termination events under the 1992 ISDA Master Agreement as specified in the Interest Rate Swap Agreement including "Illegality," "Tax Event" and "Tax Event Upon Merger," each as more fully described in Sections 5(b)(i), 5(b)(ii) and 5(b)(iii) of the 1992 ISDA Master Agreement. "SWAP TERMINATION PAYMENT" means any termination payment payable by the Issuer to the Swap Counterparty or by the Swap Counterparty to the Issuer under the Interest Rate Swap Agreement. "TRUST ESTATE" means all money, instruments, rights and other property that are subject or intended to be subject to the lien and security interest of this Indenture for the benefit of the Noteholders (including, without limitation, all property and interests Granted to the Indenture Trustee pursuant to the Granting Clause), including all proceeds thereof. "TRUST OFFICER" means, in the case of the Indenture Trustee, any officer within the Corporate Trust Office of the Indenture Trustee, including any Vice President, Assistant Vice President, Secretary, Assistant Secretary or any other officer of the Indenture Trustee customarily performing functions similar to those performed by any of the above designated officers and also, with respect to a particular matter, any other officer to whom such matter is referred because of such officer's knowledge of and familiarity with the particular subject and, with respect to the Owner Trustee, any officer in the Corporate Trust Administration Department of the Owner Trustee with direct responsibility for the administration of the Trust Agreement and the Basic Documents on behalf of the Owner Trustee. "TRUST INDENTURE ACT" or "TIA" means the Trust Indenture Act of 1939 as in force on the date hereof, unless otherwise specifically provided. "UCC" means, unless the context otherwise requires, the Uniform Commercial Code as in effect in the relevant jurisdiction at the relevant time. SECTION 1.02 USAGE OF TERMS. With respect to all terms in this Agreement, the singular includes the plural and the plural the singular; words importing any gender include the other genders; references to "writing" include printing, typing, lithography and other means of reproducing words in a visible form; references to agreements and other contractual instruments 9 include all subsequent amendments thereto or changes therein entered into in accordance with their respective terms and not prohibited by this Agreement; references to Persons include their permitted successors and assigns; and the term "including" means "including without limitation." SECTION 1.03 INCORPORATION BY REFERENCE OF TRUST INDENTURE ACT. Whenever this Indenture refers to a provision of the TIA, the provision is incorporated by reference in and made a part of this Indenture. The following TIA terms used in this Indenture have the following meanings: "COMMISSION" means the Securities and Exchange Commission. "INDENTURE SECURITIES" means the Notes. "INDENTURE SECURITY HOLDER" means a Noteholder. "INDENTURE TO BE QUALIFIED" means this Indenture. "INDENTURE TRUSTEE" or "institutional trustee" means the Indenture Trustee. "OBLIGOR" on the indenture securities means the Issuer and any other obligor on the indenture securities. All other TIA terms used in this Indenture that are defined in the TIA, defined in the TIA by reference to another statute or defined by Commission rule have the meanings so assigned to them. ARTICLE II THE NOTES SECTION 2.01 FORM. The Class A-1 Notes, the Class A-2 Notes, the Class A-3 Notes and the Class A-4 Notes, in each case together with the Indenture Trustee's certificate of authentication, shall be in substantially the form set forth in Exhibit A, with such appropriate insertions, omissions, substitutions and other variations as are required or permitted by this Indenture, and may have such letters, numbers or other marks of identification and such legends or endorsements placed thereon as may, consistently herewith, be determined by the officers executing such Notes, as evidenced by their execution thereof. Any portion of the text of any Note may be set forth on the reverse thereof, with an appropriate reference thereto on the face of the Note. The Definitive Notes shall be typewritten, printed, lithographed or engraved or produced by any combination of these methods (with or without steel engraved borders), all as determined by the officers executing such Notes, as evidenced by their execution of such Notes. Each Note shall be dated the date of its authentication. The terms of the Notes set forth in Exhibit A are part of the terms of this Indenture. 10 SECTION 2.02 EXECUTION, AUTHENTICATION AND DELIVERY. The Notes shall be executed on behalf of the Issuer by any of its Authorized Officers. The signature of any such Authorized Officer on the Notes may be manual or facsimile. Notes bearing the manual or facsimile signature of individuals who were at any time Authorized Officers of the Issuer shall bind the Issuer, notwithstanding that such individuals or any of them have ceased to hold such offices prior to the authentication and delivery of such Notes or did not hold such offices at the date of such Notes. The Indenture Trustee shall upon Issuer Order authenticate and deliver Class A-1 Notes for original issue in an aggregate principal amount of $417,840,000, Class A-2 Notes for original issue in an aggregate principal amount of $500,000,000.00, Class A-3 Notes for original issue in an aggregate principal amount of $360,000,000.00 and Class A-4 Notes for original issue in an aggregate principal amount of $175,000,000.00. The aggregate principal amount of the Class A-1 Notes, the Class A-2 Notes, the Class A-3 Notes and the Class A-4 Notes outstanding at any time may not exceed such respective amounts except as provided in Section 2.05. The Notes shall be issuable as registered Notes in the minimum denomination $1,000. Each Note shall be dated the date of its authentication. No Note shall be entitled to any benefit under this Indenture or be valid or obligatory for any purpose, unless there appears on such Note a certificate of authentication substantially in the form included in Exhibit A, executed by the Indenture Trustee by the manual or facsimile signature of one of its authorized signatories, and such certificate upon any Note shall be conclusive evidence, and the only evidence, that such Note has been duly authenticated and delivered hereunder. SECTION 2.03 TEMPORARY NOTES. Pending the preparation of definitive Notes, the Issuer may execute, and upon receipt of an Issuer Order the Indenture Trustee shall authenticate and deliver, temporary Notes that are printed, lithographed, typewritten, mimeographed or otherwise produced, of the tenor of the definitive Notes in lieu of which they are issued and with such variations not inconsistent with the terms of this Indenture as the officers executing such Notes may determine, as evidenced by their execution of such Notes. If temporary Notes are issued, the Issuer will cause definitive Notes to be prepared without unreasonable delay. After the preparation of definitive Notes, the temporary Notes shall be exchangeable for definitive Notes upon surrender of the temporary Notes at the office or agency of the Issuer to be maintained as provided in Section 3.02, without charge to the Holder. Upon surrender for cancellation of any one or more temporary Notes, the Issuer shall execute, and the Indenture Trustee shall authenticate and deliver in exchange therefor, a like principal amount of definitive Notes of authorized denominations. Until so exchanged, the temporary Notes shall in all respects be entitled to the same benefits under this Indenture as definitive Notes. SECTION 2.04 REGISTRATION; REGISTRATION OF TRANSFER AND EXCHANGE. (a) The Note Registrar shall maintain a Note Register in which, subject to such reasonable regulations as it may prescribe, the Note Registrar shall provide for the registration of Notes and transfers and exchanges of Notes as provided in this Indenture. The Indenture Trustee is hereby initially appointed Note Registrar for the purpose of registering Notes and transfers and exchanges of Notes as provided in this Indenture. In the event that, subsequent to the Closing Date, the Indenture Trustee notifies the Issuer that it is unable to act as Note Registrar, the Issuer shall appoint another bank or trust company, having an office or agency located in the Borough 11 of Manhattan, The City of New York, agreeing to act in accordance with the provisions of this Indenture applicable to it, and otherwise acceptable to the Indenture Trustee, to act as successor Note Registrar under this Indenture. If a Person other than the Indenture Trustee is appointed by the Issuer as Note Registrar, the Issuer will give the Indenture Trustee prompt written notice of the appointment of such Note Registrar and of the location, and any change in the location, of the Note Register, and the Indenture Trustee shall have the right to inspect the Note Register at all reasonable times and to obtain copies thereof, and the Indenture Trustee shall have the right to rely upon a certificate executed on behalf of the Note Registrar by an Executive Officer thereof as to the names and addresses of the Holders of the Notes and the principal amounts and number of such Notes. (b) No transfer of any Class A-1 Note shall be made unless such resale or transfer is made (i) pursuant to an effective Registration Statement under the Securities Act, (ii) in a transaction (other than a transaction in clause (iv) below) exempt from the registration requirements of the Securities Act and applicable state and foreign securities laws, (iii) to any Affiliate of TMCC or (iv) to a Person who the transferor of such Class A-1 Note reasonably believes is a qualified institutional buyer within the meaning of Rule 144A under the Securities Act and that is aware that the resale or other transfer is being made in reliance on Rule 144A or to an institutional "accredited investor" as defined in Rule 501(a)(1), (2), (3) or (7) under the Securities Act (an "Institutional Accredited Investor"). In the event that a transfer is to be made as described in clause (ii) of the preceding sentence, the prospective transferee shall deliver or cause to be delivered an Opinion of Counsel in the form and substance satisfactory to the Issuer to the effect that such transfer may be made without registration under the Securities Act or any applicable state or foreign securities laws. In the event that a transfer is to be made to an institutional accredited investor as described in clause (iv), the Indenture Trustee shall require that the transferee execute a representation letter acceptable to and in form and substance satisfactory to the Issuer certifying to the Indenture Trustee the facts surrounding such transfer, which representation shall not be an expense of the Indenture Trustee or the Servicer. In the case of a transfer under either clause (ii) or clause (iv), the Holder of a Class A-1 Note desiring to effect such transfer, shall and does hereby agree to, indemnify the Indenture Trustee, the Issuer and the Servicer against any liability that may result if the transfer is not so exempt or is not made in accordance with the Securities Act and such state and foreign securities laws. Neither the Servicer, the Issuer nor the Indenture Trustee is under any obligation to register any Class A-1 Notes under the Securities Act or any applicable state or foreign securities laws. Prospective purchasers of the Class A-1 Notes are hereby notified that the seller of any Class A-1 Notes may be relying on the exemption from the registration requirements of Section 5 of the Act provided by Rule 144A under the Act. The Class A-1 Notes, this Indenture and related documents may be amended or supplemented from time to time without the consent of any Noteholder to modify restrictions on and procedures for resale and other transfer of such Class A-1 Notes to reflect any change in applicable law or regulation (or the interpretation thereof) or practices relating to the resale or transfer of restricted securities generally. (c) Upon the proper surrender for registration of transfer of any Note at the office or agency of the Issuer to be maintained as provided in Section 3.02, the Issuer shall execute, and 12 the Indenture Trustee shall authenticate in the name of the designated transferee or transferees, one or more new Notes of the same Class in authorized denominations of a like aggregate principal amount. (d) At the option of the Holder, Notes may be exchanged for other Notes of the same Class in any authorized denominations, of a like aggregate principal amount, upon surrender of the Notes to be exchanged at such office or agency. Whenever any Notes are so surrendered for exchange, the Issuer shall execute, and the Indenture Trustee shall authenticate and the Noteholder shall obtain from the Indenture Trustee, the Notes which the Noteholder making the exchange is entitled to receive. Every Note presented or surrendered for registration of transfer or exchange shall be accompanied by a written instrument of transfer in form satisfactory to the Indenture Trustee and the Note Registrar duly executed by the Holder thereof or his attorney duly authorized in writing. (e) No service charge shall be made for any registration of transfer or exchange of Notes, but the Indenture Trustee may require payment of a sum sufficient to cover any tax or governmental charge that may be imposed in connection with any transfer or exchange of Notes. (f) All Notes surrendered for registration of transfer or exchange shall be canceled and subsequently destroyed pursuant to Section 2.08. SECTION 2.05 MUTILATED, DESTROYED, LOST OR STOLEN NOTES. If (i) any mutilated Note is surrendered to the Indenture Trustee, or the Indenture Trustee receives evidence to its satisfaction of the destruction, loss or theft of any Note, and (ii) there is delivered to the Indenture Trustee such security or indemnity as may be required by it to hold the Issuer and the Indenture Trustee harmless, then, in the absence of notice to the Issuer, the Note Registrar or the Indenture Trustee that such Note has been acquired by a bona fide purchaser, the Issuer shall execute, and upon its request the Indenture Trustee shall authenticate and deliver, in exchange for or in lieu of any such mutilated, destroyed, lost or stolen Note, a replacement Note of the same Class. In connection with the issuance of any new Note under this Section, the Issuer may require payment by the Holder of such Note of a sum sufficient to cover any tax or other governmental charge that may be imposed in relation thereto. If, after the delivery of such replacement Note or payment of a destroyed, lost or stolen Note, a bona fide purchaser of the original Note in lieu of which such replacement Note was issued presents for payment such original Note, the Issuer and the Indenture Trustee shall be entitled to recover such replacement Note (or such payment) from the Person to whom it was delivered or any Person taking such replacement Note from such Person to whom such replacement Note was delivered or any assignee of such Person, except a bona fide purchaser, and shall be entitled to recover upon the security or indemnity provided therefor to the extent of any loss, damage, cost or expense incurred by the Issuer or the Indenture Trustee in connection therewith. Every replacement Note issued pursuant to this Section in replacement of any mutilated, destroyed, lost or stolen Note shall constitute an original additional contractual obligation of the Issuer, whether or not the mutilated, destroyed, lost or stolen Note shall be at any time 13 enforceable by anyone, and shall be entitled to all the benefits of this Indenture equally and proportionately with any and all other Notes of the same Class duly issued hereunder. The provisions of this Section are exclusive and shall preclude (to the extent lawful) all other rights and remedies with respect to the replacement or payment of mutilated, destroyed, lost or stolen Notes. SECTION 2.06 PERSONS DEEMED OWNERS. Prior to due presentment for registration of transfer of any Note, the Issuer, the Indenture Trustee and any agent of the Issuer or the Indenture Trustee may treat the Person in whose name any Note is registered (as of the day of determination) as the owner of such Note for the purpose of receiving payments of principal of and interest, if any, on such Note and for all other purposes whatsoever, and none of the Issuer, the Indenture Trustee or any agent of the Issuer or the Indenture Trustee shall be affected by notice to the contrary. SECTION 2.07 PAYMENTS OF PRINCIPAL AND INTEREST. (a) The Class A-1 Notes, the Class A-2 Notes, the Class A-3 Notes and the Class A-4 Notes shall accrue interest during each Interest Period at the Class A-1 Rate, the Class A-2 Rate, the Class A-3 Rate and the Class A-4 Rate, respectively, and such interest shall be payable on each related Payment Date as specified in such Notes, pursuant to Section 5.06 of the Sale and Servicing Agreement and Section 3.01 hereof. Any installment of interest or principal payable on any Note that is punctually paid or duly provided for by the Issuer on the applicable Payment Date shall be paid to the Person in whose name such Note (or one or more Predecessor Notes) is registered on the Record Date by wire transfer in immediately available funds to the account designated by such Person. (b) The principal of each Note shall be payable in installments on each Payment Date pursuant to Section 5.06 of the Sale and Servicing Agreement and subject to the availability of funds therefor. All principal payments on each Class of Notes shall be made pro rata to the Noteholders of such Class entitled thereto. In accordance with Section 10.01, the Indenture Trustee shall notify the Person in whose name a Note is registered at the close of business on the Record Date preceding the Payment Date on which the final installment of principal of and interest on such Note will be paid. Such notice shall be mailed or transmitted by facsimile not less than 15 nor more than 30 days prior to such final Payment Date, shall specify that such final installment will be payable only upon presentation and surrender of such Note and shall specify the place where such Note may be presented and surrendered for payment of such installment. (c) In the event that any withholding tax is imposed on the Trust's payment (or allocations of income) to the Noteholders, such tax shall reduce the amount otherwise distributable to the Noteholders in accordance with this Section. The Issuer will instruct the Indenture Trustee regarding the imposition of such withholding tax and, upon receiving such instruction, the Indenture Trustee is hereby authorized and directed to retain from amounts otherwise distributable to the Noteholders sufficient funds for the payment of any tax that is legally owed by the Trust (but such authorization shall not prevent the Indenture Trustee from contesting any such tax in appropriate proceedings, and withholding payment of such tax, if permitted by law, pending the outcome of such proceedings). The amount of any withholding tax 14 imposed with respect to the Noteholders shall be treated as cash distributed to the Noteholders at the time it is withheld by the Trust and remitted to the appropriate taxing authority. If there is a possibility that withholding tax is payable with respect to any distribution (such as any distribution to a Non-U.S. Person), the Indenture Trustee may in its sole discretion withhold such amounts in accordance with this paragraph (c). In the event that any Noteholder wishes to apply for a refund of any such withholding tax, the Indenture Trustee shall reasonably cooperate with the Noteholder in making such claim so long as the Noteholder agrees to reimburse the Indenture Trustee for any out-of-pocket expenses incurred. SECTION 2.08 CANCELLATION. All Notes surrendered for payment, registration of transfer or exchange shall, if surrendered to any Person other than the Indenture Trustee, be delivered to the Indenture Trustee and shall be promptly canceled by the Indenture Trustee. The Issuer may at any time deliver to the Indenture Trustee for cancellation any Notes previously authenticated and delivered hereunder which the Issuer may have acquired in any manner whatsoever, and all Notes so delivered shall be promptly canceled by the Indenture Trustee. No Notes shall be authenticated in lieu of or in exchange for any Notes canceled as provided in this Section, except as expressly permitted by this Indenture. All canceled Notes may be held or disposed of by the Indenture Trustee in accordance with its standard retention or disposal policy as in effect at the time unless the Issuer shall direct by an Issuer Order that they be destroyed or returned to it; provided, that such Issuer Order is timely and the Notes have not been previously disposed of by the Indenture Trustee. SECTION 2.09 RELEASE OF COLLATERAL. Subject to Sections 10.01 and 11.01 and the terms of the Basic Documents, the Indenture Trustee shall release property from the lien of this Indenture only upon receipt of an Issuer Request accompanied by an Officer's Certificate, an Opinion of Counsel and Independent Certificates in accordance with TIA Sections 314(c) and 314(d)(l) or an Opinion of Counsel in lieu of such Independent Certificates to the effect that the TIA does not require any such Independent Certificates. SECTION 2.10 BOOK-ENTRY NOTES. The Class A-2 Notes, the Class A-3 Notes and the Class A-4 Notes, upon original issuance, will be issued in the form of typewritten Notes representing the Book-Entry Notes, to be delivered to The Depository Trust Company, the initial Clearing Agency, or a custodian therefor, by, or on behalf of, the Issuer. The Book-Entry Notes shall be registered initially on the Note Register in the name of Cede & Co., the nominee of the initial Clearing Agency, and no Note Owner thereof will receive a definitive Note representing such Note Owner's interest in such Note, except as provided in Section 2.12. Unless and until definitive, fully registered Notes (the "Definitive Notes") have been issued to such Note Owners pursuant to Section 2.12: (a) the provisions of this Section shall be in full force and effect; (b) the Note Registrar and the Indenture Trustee shall be entitled to deal with the Clearing Agency for all purposes of this Indenture (including the payment of principal of and interest on the Book-Entry Notes and the giving of instructions or directions hereunder) as the authorized representative of such Note Owners; 15 (c) to the extent that the provisions of this Section conflict with any other provisions of this Indenture, the provisions of this Section shall control; (d) the rights of such Note Owners shall be exercised only through the Clearing Agency and shall be limited to those established by law and agreements between such Note Owners and the Clearing Agency and/or the Clearing Agency Participants pursuant to the Note Depository Agreement. Unless and until Definitive Notes are issued in respect of the Book-Entry Notes pursuant to Section 2.12, the initial Clearing Agency will make book-entry transfers among the Clearing Agency Participants and receive and transmit payments of principal of and interest on such Notes to such Clearing Agency Participants; and (e) whenever this Indenture requires or permits actions to be taken based upon instructions or directions of Holders of the Class A-1 Notes, the Class A-2 Notes, the Class A-3 Notes and/or the Class A-4 Notes evidencing a specified percentage of the Outstanding Amount of the Notes or of any such Class or of two or more of such Classes, the Clearing Agency shall be deemed to represent such percentage only to the extent that it has received instructions to such effect from Note Owners of Book-Entry Notes and/or Clearing Agency Participants owning or representing, respectively, such required percentage of the beneficial interest in such Notes and has delivered such instructions to the Indenture Trustee. SECTION 2.11 NOTICES TO CLEARING AGENCY. Whenever a notice or other communication to the Noteholders is required under this Indenture, unless and until Definitive Notes shall have been issued to the Note Owners of Book-Entry Notes pursuant to Section 2.12, the Indenture Trustee shall give all such notices and communications specified herein to be given to Holders of the Book-Entry Notes to the Clearing Agency and shall be deemed to have been given as of the date of delivery to the Clearing Agency. SECTION 2.12 DEFINITIVE NOTES. The Class A-1 Notes, upon original issuance, will be issued as Definitive Notes. In the case of the Book-Entry Notes, if (i) the Owner Trustee or the Administrator advises the Indenture Trustee in writing that the Clearing Agency is no longer willing or able to properly discharge its responsibilities with respect to the Book-Entry Notes and the Owner Trustee and the Administrator are unable to locate a qualified successor (and if the Administrator has made such determination, the Administrator has given written notice thereof to the Indenture Trustee), (ii) the Seller or the Administrator or the Indenture Trustee at its option advises each other such party in writing that it elects to terminate the book-entry system through the Clearing Agency or (iii) after the occurrence of an Event of Default or a Servicer Default, owners of the Book-Entry Notes representing beneficial interests aggregating at least 51% of the Outstanding Amount of the Book-Entry Notes, advise the Indenture Trustee and the Clearing Agency in writing that the continuation of a book-entry system through the Clearing Agency or a successor thereto is no longer in the best interests of the Note Owners acting together as a single Class, then the Clearing Agency shall notify all Note Owners and the Indenture Trustee of the occurrence of such event and of the availability of Definitive Notes to Note Owners requesting the same. Upon surrender to the Indenture Trustee of the typewritten Notes representing the Book-Entry Notes by the Clearing Agency, accompanied by registration instructions, the Issuer shall execute and the Indenture Trustee shall authenticate the Definitive Notes in accordance with the instructions of the Clearing Agency. None of the Issuer, the Note Registrar or the Indenture Trustee shall be liable for any delay in delivery of such instructions and may 16 conclusively rely on, and shall be protected in relying on, such instructions. Upon the issuance of Definitive Notes, the Indenture Trustee shall recognize the Holders of the Definitive Notes as Noteholders. The Indenture Trustee, Issuer and Administrator shall not be liable for any inability to locate a qualified successor Clearing Agency. From and after the date of issuance of Definitive Notes, all notices to be given to Noteholders will be mailed thereto at their addresses of record in the Note Register as of the relevant Record Date. Such notices will be deemed to have been given as of the date of mailing. SECTION 2.13 TAX TREATMENT. The Issuer has entered into this Indenture, and the Notes will be issued, with the intention that, for federal, state and local income, single business and franchise tax purposes, the Notes will qualify as indebtedness secured by the Trust Estate. The Issuer, by entering into this Indenture, and each Noteholder, by its acceptance of a Note (and each Note Owner by its acceptance of an interest in the applicable Book-Entry Note), agree to treat the Notes for federal, state and local income, single business and franchise tax purposes as indebtedness. ARTICLE III COVENANTS SECTION 3.01 PAYMENTS TO NOTEHOLDERS, CERTIFICATEHOLDER, SWAP COUNTERPARTY, SERVICER AND SELLER. In accordance with the terms of this Indenture, the Issuer will duly and punctually (i) pay the principal of and interest, if any, on the Notes in accordance with the terms of the Notes, (ii) pay to the Swap Counterparty any Swap Payments Outgoing and Swap Termination Payment when due, and (iii) release from the Collection Account, Principal Distribution Account and Payahead Account all other amounts distributable or payable from the Owner Trust Estate (including distributions to be made to the Certificateholder on any Payment Date) under the Trust Agreement, Sale and Servicing Agreement and Administration Agreement. Without limiting the foregoing, and in order to fulfill such obligations, pursuant to Sections 8.02 and 8.04 hereof, the Issuer will cause the Servicer to direct the Indenture Trustee to apply all amounts on deposit in the Collection Account, Payahead Account and Reserve Account on a Payment Date deposited therein pursuant to the Sale and Servicing Agreement (i) (a) for the benefit of the Class A-1 Notes, to the Class A-1 Noteholders, (b) for the benefit of the Class A-2 Notes, to the Class A-2 Noteholders, (c) for the benefit of the Class A-3 Notes, to the Class A-3 Noteholders and (d) for the benefit of the Class A-4 Notes, to the Class A-4 Noteholders, in each case as set forth in Sections 5.06 and 5.07 of the Sale and Servicing Agreement, (ii) for the benefit of the Certificateholder, to or as directed by the Owner Trustee or the Administrator, as set forth in Sections 5.06 and 5.07 of the Sale and Servicing Agreement, (iii) for the benefit of the Swap Counterparty , to or as directed by the Servicer pursuant to Section 5.06 of the Sale and Servicing Agreement, (iv) for the benefit of the Servicer, to or as directed by the Servicer pursuant to Section 5.06 of the Sale and Servicing Agreement, and (v) for the benefit of the Seller, to or as directed by the Seller pursuant to Section 5.07 of the Sale and Servicing Agreement. Amounts properly withheld under the Code by any Person from a payment to any Noteholder or the Certificateholder of interest and/or principal shall be considered as having been paid by the Issuer to such Noteholder or the Certificateholder for all purposes of this Indenture. 17 SECTION 3.02 MAINTENANCE OF OFFICE OR AGENCY. The Issuer will maintain in the Borough of Manhattan, The City of New York, an office or agency where Notes may be surrendered for registration of transfer or exchange, and where notices and demands to or upon the Issuer in respect of the Notes and this Indenture may be served. The Issuer hereby initially appoints Wells Fargo Bank Minnesota, National Association to serve as its agent for the foregoing purposes. The Issuer will give prompt written notice to the Indenture Trustee of the location, and of any change in the location, of any such office or agency. If at any time the Issuer shall fail to maintain any such office or agency or shall fail to furnish the Indenture Trustee with the address thereof, such surrenders, notices and demands may be made or served at the Corporate Trust Office, and the Issuer hereby appoints the Indenture Trustee as its agent to receive all such surrenders, notices and demands. SECTION 3.03 MONEY FOR PAYMENTS TO BE HELD IN TRUST. All payments of amounts due and payable with respect to any Notes or the Certificate or to the Swap Counterparty (to the extent such payments to the Swap Counterparty were not deducted from amounts remitted to the Collection Account by the Servicer pursuant to Section 5.04(e) of the Sale and Servicing Agreement) that are to be made from amounts withdrawn from the Collection Account, Principal Distribution Account or Reserve Fund (provided that only the Collection Account is available for any amounts payable to the Swap Counterparty) pursuant to Sections 2.07, 3.01, 4.02 and 4.03 shall be made on behalf of the Issuer by the Indenture Trustee or by a Paying Agent, and no amounts so withdrawn from such accounts for payments of Notes or the Certificate or to the Swap Counterparty (provided that such amounts payable to the Swap Counterparty were not deducted from amounts remitted to the Collection Account by the Servicer pursuant to Section 5.04(e) of the Sale and Servicing Agreement) shall be paid over to the Issuer, the Owner Trustee or the Administrator except as provided in this Section. On or before each Payment Date, the Issuer shall deposit in the Collection Account or, in accordance with the Sale and Servicing Agreement, cause to be deposited (including the provision of instructions to the Indenture Trustee to make any required withdrawals from the Payahead Account or Reserve Account and to deposit such amounts in the Collection Account) to the extent of funds available therefor, an aggregate sum sufficient to pay the amounts then becoming due under the Notes and the Certificate, such sum to be held in trust for the benefit of the Persons entitled thereto, and (unless the Paying Agent is the Indenture Trustee) shall promptly notify the Indenture Trustee of its action or failure so to act. The Indenture Trustee, as Paying Agent, hereby agrees with the Issuer that it will, and the Issuer will cause each Paying Agent other than the Indenture Trustee, as a condition to its acceptance of its appointment as Paying Agent, to execute and deliver to the Indenture Trustee an instrument in which such Paying Agent shall agree with the Indenture Trustee, subject to the provisions of this Section, that such Paying Agent will: (a) hold all sums held by it for the payment of amounts due with respect to the Notes or the Certificate or to the Swap Counterparty or for release to the Issuer for payment to the Certificateholder in trust for the benefit of the Persons entitled thereto until such sums shall be paid to such Persons or otherwise disposed of as herein provided and pay or release such sums to such Persons as herein provided; 18 (b) give the Indenture Trustee notice of any default by the Issuer (or any other obligor upon the Notes) of which it has actual knowledge in the making of any payment required to be made with respect to the Notes or to the Swap Counterparty or the release of any amounts to the Issuer to be paid to the Certificateholder; (c) at any time during the continuance of any such default, upon the written request of the Indenture Trustee, forthwith pay to the Indenture Trustee all sums so held in trust by such Paying Agent; (d) immediately resign as a Paying Agent and forthwith pay to the Indenture Trustee all sums held by it in trust for the payment of Notes (or for release to the Issuer) or to the Swap Counterparty if at any time it ceases to meet the standards required to be met by a Paying Agent at the time of its appointment; and (e) comply with all requirements of the Code with respect to the withholding from any payments made by it on any Notes or the Certificate (or assisting the Issuer to withhold from payment to the Certificateholder) or to the Swap Counterparty of any applicable withholding taxes imposed thereon and with respect to any applicable reporting requirements in connection therewith. The Issuer may at any time, for the purpose of obtaining the satisfaction and discharge of this Indenture or for any other purpose, by Issuer Order direct any Paying Agent to pay to the Indenture Trustee all sums held in trust by such Paying Agent, such sums to be held by the Indenture Trustee upon the same trusts as those upon which the sums were held by such Paying Agent; and upon such payment by any Paying Agent to the Indenture Trustee, such Paying Agent shall be released from all further liability with respect to such money. Subject to applicable laws with respect to escheat of funds, any money held by the Indenture Trustee or any Paying Agent in trust for the payment of any amount due with respect to any Note and remaining unclaimed after such amount has become due and payable and after the Indenture Trustee has taken the steps described in the next paragraph shall be discharged from such trust and be paid to the California Special Olympics upon presentation thereto of an Issuer Request; and the Holder of such Note shall thereafter, as an unsecured general creditor, look only to the Issuer for payment thereof, and all liability of the Indenture Trustee or such Paying Agent with respect to such trust money shall thereupon cease. In the event that any Noteholder shall not surrender its Notes for retirement within six months after the date specified in the written notice of final payment described in Section 2.07, the Indenture will give a second written notice to the registered Noteholders that have not surrendered their Notes for final payment and retirement. If within one year after such second notice any Notes have not been surrendered, the Indenture Trustee shall, at the expense and direction of the Issuer, cause to be published once, in a newspaper published in the English language, customarily published on each Business Day and of general circulation in The City of New York, notice that such money remains unclaimed and that, after a date specified therein, which shall not be less than 30 days from the date of such publication, any unclaimed balance of such money then remaining will be paid to California Special Olympics. The Indenture Trustee 19 shall also adopt and employ, at the expense and direction of the Issuer, any other reasonable means of notification of such repayment specified by the Issuer or the Administrator. SECTION 3.04 EXISTENCE. The Issuer will keep in full effect its existence, rights and franchises as a business trust under the laws of the State of Delaware (unless it becomes, or any successor Issuer hereunder is or becomes, organized under the laws of any other State or of the United States of America, in which case the Issuer will keep in full effect its existence, rights and franchises under the laws of such other jurisdiction) and will obtain and preserve its qualification to do business in each jurisdiction in which such qualification is or shall be necessary to protect the validity and enforceability of this Indenture, the Notes, the Collateral and each other instrument or agreement included in the Trust Estate or the Owner Trust Estate. SECTION 3.05 PROTECTION OF TRUST ESTATE. The Issuer will from time to time execute and deliver all such supplements and amendments hereto and all such financing statements, continuation statements, instruments of further assurance and other instruments, and will take such other action necessary or advisable to: (a) maintain or preserve the lien and security interest (and the priority thereof) of this Indenture or carry out more effectively the purposes hereof; (b) perfect, publish notice of or protect the validity of any Grant made or to be made by this Indenture; (c) enforce any of the Collateral (including all rights under the Interest Rate Swap Agreement); or (d) preserve and defend title to the Trust Estate and the rights of the Indenture Trustee and the Noteholders in such Trust Estate against the claims of all persons and parties. The Issuer hereby designates the Indenture Trustee its agent and attorney-in-fact to execute any financing statement, continuation statement or other instrument required to be executed pursuant to this Section 3.05. SECTION 3.06 OPINIONS AS TO TRUST ESTATE. (a) On the Closing Date, the Issuer shall furnish to the Indenture Trustee an Opinion of Counsel either stating that, in the opinion of such counsel, such action has been taken with respect to the execution, recording and filing of this Indenture, any indentures supplemental hereto, any requisite financing statements and continuation statements and any other requisite documents necessary to perfect and make effective the lien and security interest of this Indenture or stating that, in the opinion of such counsel, no such action is necessary to make such lien and security interest effective. (b) As and when specified in Section 10.02(h) of the Sale and Servicing Agreement, the Issuer shall furnish to the Indenture Trustee an Opinion of Counsel either stating that, in the opinion of such counsel, such action has been taken with respect to the execution, recording, filing or re-recording and refiling of this Indenture, any indentures supplemental hereto, any financing statements and continuation statements and any other requisite documents necessary to 20 maintain the lien and security interest created by this Indenture or stating that in the opinion of such counsel no such action is necessary to maintain such lien and security interest. Such Opinion of Counsel shall also describe the execution, recording, filing or re-recording and refiling of this Indenture, any indentures supplemental hereto, any financing statements and continuation statements and any other documents that will, in the opinion of such counsel, be required to maintain the lien and security interest of this Indenture until the date in the following calendar year on which such Opinion of Counsel must again be delivered. SECTION 3.07 PERFORMANCE OF OBLIGATIONS; SERVICING OF RECEIVABLES. (a) The Issuer will not take any action and will use its best efforts not to permit any action to be taken by others that would release any Person from any of such Person's material covenants or obligations under any instrument or agreement included in the Trust Estate or that would result in the amendment, hypothecation, subordination, termination or discharge of, or impair the validity or effectiveness of, any such instrument or agreement, except in each case as expressly provided in the Basic Documents and the Interest Rate Swap Agreement. (b) The Issuer may contract with other Persons to assist it in performing its duties under this Indenture, and any performance of such duties by a Person identified to the Indenture Trustee in an Officer's Certificate of the Issuer shall be deemed to be action taken by the Issuer. Initially, the Issuer has contracted with the Servicer and the Administrator to assist the Issuer in performing its duties under this Indenture. (c) The Issuer will punctually perform and observe all of its obligations and agreements contained in the Basic Documents and in the instruments and agreements included in the Trust Estate, including but not limited to filing or causing to be filed all UCC financing statements and continuation statements required to be filed by the terms of the Trust Agreement, this Indenture and the Sale and Servicing Agreement in accordance with and within the time periods provided for herein and therein. (d) If an Authorized Officer of the Issuer shall have knowledge of the occurrence of a Servicer Default under the Sale and Servicing Agreement, the Issuer shall promptly notify the Indenture Trustee and shall specify in such notice the action, if any, the Issuer is taking with respect of such default, and the Indenture Trustee shall promptly notify the Rating Agencies of such Servicer Default and proposed actions of the Issuer. If a Servicer Default shall arise from the failure of the Servicer to perform any of its duties or obligations under the Sale and Servicing Agreement with respect to the Receivables, the Issuer shall take all reasonable steps available to it to remedy such failure. (e) As promptly as possible after the giving of notice of termination to the Servicer of the Servicer's rights and powers pursuant to Section 8.01 of the Sale and Servicing Agreement, or if the Servicer resigns in accordance with the terms of the Sale and Servicing Agreement, the Indenture Trustee shall give prompt written notice of such event to the Noteholders and each Rating Agency and shall act to appoint a successor servicer (the "Successor Servicer"). Any such Successor Servicer shall accept its appointment by a written assumption in a form acceptable to the Indenture Trustee. In the event that a Successor Servicer has not been appointed and accepted its appointment as set forth in Section 8.02 of the Sale and Servicing 21 Agreement, the Indenture Trustee without further action shall automatically be appointed the Successor Servicer and shall thereafter be entitled to the Servicing Fee. Notwithstanding the above, the Indenture Trustee shall, if it shall be unwilling or legally unable so to act, appoint or petition a court of competent jurisdiction to appoint any established institution having a net worth of not less than $50,000,000 and whose regular business shall include the servicing of automobile and/or light-duty truck receivables, as the successor to the Servicer under the Sale and Servicing Agreement, in accordance with the provisions of Section 8.02 of the Sale and Servicing Agreement. Upon such appointment, the Indenture Trustee will be released from the duties and obligations of acting as Successor Servicer, such release effective upon the effective date of the servicing agreement entered into between the Successor Servicer and the Issuer. In connection with any such appointment, the Indenture Trustee may make such arrangements for the compensation of such successor as it and such Successor Servicer shall agree, subject to the limitations set forth below and in the Sale and Servicing Agreement, and in accordance with Section 8.02 of the Sale and Servicing Agreement, the Issuer shall enter into an agreement with such successor for the servicing of the Receivables (such agreement to be in form and substance satisfactory to the Indenture Trustee). If the Indenture Trustee shall succeed to the Servicer's duties as servicer of the Receivables as provided herein, it shall do so in its individual capacity and not in its capacity as Indenture Trustee and, accordingly, the provisions of Article VI hereof shall be inapplicable to the Indenture Trustee in its duties as Successor Servicer and the servicing of the Receivables. In case the Indenture Trustee shall become the Successor Servicer, the Indenture Trustee shall be entitled to appoint as a subservicer any one of its affiliates, provided that the Indenture Trustee, in its capacity as Successor Servicer, shall remain fully liable for the actions and omissions of such Affiliate. (f) Without derogating from the absolute nature of the assignment granted to the Indenture Trustee under this Indenture or the rights of the Indenture Trustee hereunder, the Issuer agrees that it will not enter into any amendment, modification, supplement or waiver with respect to any Basic Document and the Interest Rate Swap Agreement except (i) to cure any ambiguity, to correct or supplement any provisions in this Agreement or for the purpose of adding any provisions to or changing in any manner or eliminating any of the provisions in this Agreement or of modifying in any manner the rights of the Noteholders or the Certificateholder, and in each case with the consent of the Indenture Trustee (but without the consent of any of the Noteholders or the Certificateholder) and delivery of an Opinion of Counsel delivered to the Owner Trustee and the Indenture Trustee, to the effect that such action will not adversely affect in any material respect the interests of any Noteholder or the Certificateholder; (ii) for the purpose of changing the formula for determining the Specified Reserve Account Balance, the manner in which the Reserve Account is funded, changing the remittance schedule for the deposit of collections with respect to the Receivables in the Collection Account or Payahead Account pursuant to Section 5.02 of the Sale and Servicing Agreement or changing the definition of Eligible Investment, in each case with the consent of the Indenture Trustee (but without the consent of any of the Noteholders or the Certificateholder) if the Indenture Trustee and/or the Owner Trustee, as the case may be, has received a letter from each Rating Agency to the effect that such Rating Agency will not qualify, reduce or withdraw the rating it has currently assigned to any Class of Notes as a result of such amendment (provided that no such amendment may increase or reduce in any manner or accelerate or delay the timing of collections on the Receivables or payments required to be made to any Class of Notes or the Certificate without the consent of all Holders of 22 each affected Class); or (iii) with the consent of the Indenture Trustee and satisfaction of all other conditions precedent to such action set forth in the related Basic Document and the Interest Rate Swap Agreement. If any such amendment, modification, supplement or waiver shall be so consented to by the Indenture Trustee or such Holders, as applicable, the Issuer agrees, promptly following a request by the Indenture Trustee to agree to such amendment and to execute and deliver, in its own name and at its own expense, such agreements, instruments, consents and other documents as the Indenture Trustee may deem necessary or appropriate in the circumstances to implement such amendment and to cause the relevant Basic Documents and the Interest Rate Swap Agreement, as amended, to be enforceable against the Issuer. SECTION 3.08 NEGATIVE COVENANTS. So long as any Notes are Outstanding, the Issuer shall not: (a) except as expressly permitted by Basic Documents, sell, transfer, exchange or otherwise dispose of any of the properties or assets of the Issuer, including those included in the Trust Estate, unless directed to do so by the Indenture Trustee; (b) claim any credit on, or make any deduction from the principal or interest payable in respect of, the Notes (other than amounts properly withheld from such payments under the Code) or assert any claim against any present or former Noteholder by reason of the payment of the taxes levied or assessed upon any part of the Trust Estate; (c) except as may be expressly permitted hereby and by the Basic Documents, (A) permit the validity or effectiveness of this Indenture to be impaired, or permit the lien of this Indenture to be amended, hypothecated, subordinated, terminated or discharged, or permit any Person to be released from any covenants or obligations with respect to the Notes under this Indenture, (B) permit any lien, charge, excise, claim, security interest, mortgage or other encumbrance (other than the lien of this Indenture) to be created on or extend to or otherwise arise upon or burden the Trust Estate or any part thereof or any interest therein or the proceeds thereof (other than tax liens, mechanics' liens and other liens that arise by operation of law, in each case on any of the Financed Vehicles and arising solely as a result of an action or omission of the related Obligor), (C) permit the lien of this Indenture not to constitute a valid first priority (other than with respect to any such tax, mechanics' or other lien) security interest in the Trust Estate or (D) dissolve or liquidate in whole or in part; or (d) assume or incur any indebtedness other than the Notes or as expressly contemplated by this Indenture (in connection with the obligation to reimburse Advances from the Trust Estate, or to pay expenses from the Trust Estate) or by the Basic Documents as in effect on the date hereof. SECTION 3.09 ANNUAL STATEMENT AS TO COMPLIANCE. The Issuer will cause the Servicer to deliver to the Indenture Trustee concurrently with its delivery thereof to the Issuer the annual statement of compliance described in Section 4.11 of the Sale and Servicing Agreement. In addition, on the same date annually upon which such annual statement of compliance is to be delivered by the Servicer, the Issuer shall deliver to the Indenture Trustee an Officer's Certificate stating, as to the Authorized Officer signing such Officer's Certificate, that: 23 (a) a review of the activities of the Issuer during such year and of its performance under this Indenture has been made under such Authorized Officer's supervision; and (b) to the best of such Authorized Officer's knowledge, based on such review, the Issuer has complied with all conditions and covenants under this Indenture throughout such year, or, if there has been a default in its compliance with any such condition or covenant, specifying each such default known to such Authorized Officer and the nature and status thereof. SECTION 3.10 ISSUER MAY CONSOLIDATE, ETC., ONLY ON CERTAIN TERMS. (a) The Issuer shall not consolidate or merge with or into any other Person, unless: (i) the Person (if other than the Issuer) formed by or surviving such consolidation or merger shall be a Person organized and existing under the laws of the United States of America or any State or the District of Columbia and shall expressly assume, by an indenture supplemental hereto, executed and delivered to the Indenture Trustee, in form satisfactory to the Indenture Trustee, the duty to make due and punctual payments of the principal of and interest on all Notes in accordance with the terms thereof and the performance or observance of every agreement and covenant of this Indenture on the part of the Issuer to be performed or observed, all as provided herein; (ii) immediately after giving effect to such transaction, no Default or Event of Default shall have occurred and be continuing; (iii) each Rating Agency shall have notified the Indenture Trustee and the Owner Trustee that such transaction will not result in the removal or reduction of the rating then assigned thereby to any Class of Notes; (iv) the Issuer shall have received an Opinion of Counsel (and shall have delivered copies thereof to the Indenture Trustee) to the effect that such transaction will not have any material adverse tax consequence to the Issuer, any Noteholder or any Certificateholder; (v) any action that is necessary to maintain each lien and security interest created by the Trust Agreement, the Sale and Servicing Agreement or by this Indenture shall have been taken; and (vi) the Issuer shall have delivered to the Indenture Trustee an Officer's Certificate and an Opinion of Counsel each stating that such consolidation or merger and any related supplemental indenture complies with this Section 3.10 and that all conditions precedent provided for in this Indenture relating to such transaction have been complied with (including any filing required by the Exchange Act). (b) Except as expressly provided in this Indenture or in the Basic Documents, the Issuer shall not convey or transfer its properties or assets, including those included in the Trust Estate, to any Person, unless: 24 (i) the Person that acquires by conveyance or transfer such properties and assets of the Issuer shall (A) be a United States citizen or a Person organized and existing under the laws of the United States of America or any State or the District of Columbia, (B) expressly assume, by an indenture supplemental hereto, executed and delivered to the Indenture Trustee, in form satisfactory to the Indenture Trustee, the duty to make due and punctual payments of the principal of and interest on all Notes and the performance or observance of every agreement and covenant of this Indenture on the part of the Issuer to be performed or observed, all as provided herein, (C) expressly agrees by means of such supplemental indenture that all right, title and interest so conveyed or transferred shall be subject and subordinate to the rights of Holders of the Notes, (D) unless otherwise provided in such supplemental indenture, expressly agrees to indemnify, defend and hold harmless the Issuer, the Owner Trustee and the Indenture Trustee against and from any loss, liability or expense arising under or related to this Indenture and the Notes, and (E) expressly agrees by means of such supplemental indenture that such Person (or if a group of Persons, then one specified Person) shall make all filings that counsel satisfactory to such purchaser or transferee and the Indenture Trustee determines must be made with (1) the Commission (and any other appropriate Person) required by the Exchange Act or the appropriate authorities in any State in which the Notes have been sold pursuant to any qualification or exemption under the securities or "blue sky" laws of such State, in connection with the Notes or (2) the Internal Revenue Service or the relevant state or local taxing authorities of any jurisdiction; (ii) immediately after giving effect to such transaction, no Default or Event of Default shall have occurred and be continuing; (iii) each Rating Agency shall have notified the Indenture Trustee and the Owner Trustee that such transaction might or would result in the removal or reduction of the rating then assigned thereby to any Class of Notes; (iv) the Issuer shall have received an Opinion of Counsel (and shall have delivered copies thereof to the Indenture Trustee) to the effect that such transaction will not have any material adverse tax consequence to the Issuer, any Noteholder or any Certificateholder; (v) any action that is necessary to maintain each lien and security interest created by the Trust Agreement, the Sale and Servicing Agreement or by this Indenture shall have been taken; and (vi) the Issuer shall have delivered to the Indenture Trustee an Officer's Certificate and an Opinion of Counsel each stating that such conveyance or transfer and such supplemental indenture comply with this Section 3.10 and that all conditions precedent herein provided for relating to such transaction have been complied with (including any filing required by the Exchange Act). 25 SECTION 3.11 SUCCESSOR OR TRANSFEREE. (a) Upon any consolidation or merger of the Issuer in accordance with Section 3.10(a), the Person formed by or surviving such consolidation or merger (if other than the Issuer) shall succeed to, and be substituted for, and may exercise every right and power of, the Issuer under this Indenture with the same effect as if such Person had been named as the Issuer herein. (b) Upon a conveyance or transfer of all the assets and properties of the Issuer pursuant to Section 3.10(b), Toyota Auto Receivables 2001-B Owner Trust will be released from every covenant and agreement of this Indenture to be observed or performed on the part of the Issuer with respect to the Notes immediately upon the delivery of written notice to the Indenture Trustee stating that Toyota Auto Receivables 2001-B Owner Trust is to be so released. SECTION 3.12 NO OTHER BUSINESS. Unless and until the Issuer shall have been released from its duties and obligations hereunder, the Issuer shall not engage in any business other than financing, purchasing, owning, selling and managing the Receivables in the manner contemplated by the Basic Documents and activities incidental thereto. SECTION 3.13 NO BORROWING. Unless and until the Issuer shall have been released from its duties and obligations hereunder, the Issuer shall not issue, incur, assume, guarantee or otherwise become liable, directly or indirectly, for any indebtedness except for the Notes or other obligations permitted hereunder (including the obligation to reimburse Advances from the Trust Estate or pay expenses from the Trust Estate) or under another Basic Document (including indemnification expenses of the Issuer and certain fees and expenses of the Servicer and the Administrator). SECTION 3.14 SERVICER'S NOTICE OBLIGATIONS. The Issuer shall cause the Servicer to comply with all of its duties and obligations with respect to the preparation of reports, the delivery of Officer's Certificates and Opinions of Counsel and the giving of instructions and notices under the Sale and Servicing Agreement (including, but not limited to, under Sections 3.02, 4.08, 4.10, 4.11, 4.12, 4.15, 5.08 and Article X thereof). SECTION 3.15 GUARANTEES, LOANS, ADVANCES AND OTHER LIABILITIES. Unless and until the Issuer shall have been released from its duties and obligations hereunder, except as contemplated by the Sale and Servicing Agreement, this Indenture or the other Basic Documents, the Issuer shall not make any loan or advance or credit to, or guarantee (directly or indirectly or by an instrument having the effect of assuring another's payment or performance on any obligation or capability of so doing or otherwise), endorse or otherwise become contingently liable, directly or indirectly, in connection with the obligations, stocks or dividends of, or own, purchase, repurchase or acquire (or agree contingently to do so) any stock, obligations, assets or securities of, or any other interest in, or make any capital contribution to, any other Person. SECTION 3.16 CAPITAL EXPENDITURES. Unless and until the Issuer shall have been released from its duties and obligations hereunder, the Issuer shall not make any expenditure (by long-term or operating lease or otherwise) for capital assets (either realty or personalty). 26 SECTION 3.17 REMOVAL OF ADMINISTRATOR. So long as any Notes are Outstanding, the Issuer shall not remove the Administrator without cause unless so instructed by the Owner Trustee or the Indenture Trustee and unless each Rating Agency shall have received 10 days' written notice thereof and shall not have notified the Indenture Trustee, the Administrator or the Owner Trustee that such removal might or would result in the removal or reduction of the rating then assigned thereby to any Class of Notes. SECTION 3.18 RESTRICTED PAYMENTS. The Issuer shall not, directly or indirectly, (i) pay any dividend or make any distribution (by reduction of capital or otherwise), whether in cash, property, securities or a combination thereof, to the Servicer, the Owner Trustee or the Certificateholder or otherwise with respect to any ownership or equity interest or security in or of the Issuer, (ii) redeem, purchase, retire or otherwise acquire for value any such ownership or equity interest or security or (iii) set aside or otherwise segregate any amounts for any such purpose; PROVIDED, HOWEVER, that the Issuer may make, or cause to be made, distributions or payments to the Servicer, the Owner Trustee and the Certificateholder as contemplated by, and to the extent funds are available for such purpose under, the Basic Documents. The Issuer will not, directly or indirectly, make payments to or distributions from the Collection Account except in accordance with the Basic Documents. SECTION 3.19 NOTICE OF EVENTS OF DEFAULT. The Issuer shall give the Indenture Trustee and the Rating Agencies prompt written notice of each Event of Default hereunder, each default on the part of the Servicer or the Seller of its obligations under the Sale and Servicing Agreement and each default on the part of TMCC of its obligations under the Receivables Purchase Agreement. The Indenture Trustee shall notify each Noteholder of record in writing of any Event of Default promptly upon a Trust Officer obtaining actual knowledge thereof. Such notices will be provided in accordance with Section 2.11 or 2.12, as applicable. SECTION 3.20 FURTHER INSTRUMENTS AND ACTIONS. Upon request of the Indenture Trustee, the Issuer will execute and deliver such further instruments and do such further acts as may be reasonably necessary or proper to carry out more effectively the purpose of this Indenture. ARTICLE IV SATISFACTION AND DISCHARGE SECTION 4.01 SATISFACTION AND DISCHARGE OF INDENTURE. This Indenture shall cease to be of further effect with respect to the Notes except as to (i) rights of registration of transfer and exchange, (ii) substitution of mutilated, destroyed, lost or stolen Notes, (iii) rights of Noteholders to receive payments of principal thereof and interest thereon, (iv) Section 3.03, (v) the rights, obligations and immunities of the Indenture Trustee hereunder (including the rights of the Indenture Trustee under Section 6.07 and the obligations of the Indenture Trustee under Sections 3.03 and 4.02), and (vi) the rights of Noteholders, the Certificateholder and the Swap Counterparty as beneficiaries hereof with respect to the property so deposited with the Indenture Trustee payable to all or any of them, and the Indenture Trustee, on demand of and at the 27 expense of the Issuer, shall execute proper instruments acknowledging satisfaction and discharge of this Indenture with respect to the Notes, when: (a) either (1) all Notes theretofore authenticated and delivered (other than Notes that have been destroyed, lost or stolen and that have been replaced or paid as provided in Section 2.05 and Notes for whose payment money has theretofore been deposited in trust or segregated and held in trust by the Issuer and thereafter repaid to the Issuer or discharged from such trust, as provided in Section 3.03) have been delivered to the Indenture Trustee for cancellation and the Interest Rate Swap Agreement has been terminated and all Swap Payments Outgoing and, if applicable, any Swap Termination Payments owed by the Issuer to the Swap Counterparty has been paid or (2) all Notes not theretofore delivered to the Indenture Trustee for cancellation have become due and payable or will become due and payable within one year (either because the Class A-4 Final Scheduled Payment Date is within one year or because the Indenture Trustee has received notice of the exercise of the option granted pursuant to Section 9.01 of the Sale and Servicing Agreement) and the Issuer has irrevocably deposited or caused to be irrevocably deposited with the Indenture Trustee cash or direct obligations of or obligations guaranteed by the United States of America (which will mature prior to the date such amounts are payable), in trust for such purpose, in an amount sufficient to pay and discharge the entire indebtedness on such Notes not theretofore delivered to the Indenture Trustee for cancellation when due and the Swap Counterparty; (b) the Issuer has paid or caused to be paid all other sums payable hereunder by the Issuer; and (c) the Issuer has delivered to the Indenture Trustee an Officer's Certificate, an Opinion of Counsel and (if required by the TIA or the Indenture Trustee) an Independent Certificate from a firm of certified public accountants, each meeting the applicable requirements of Section 11.01 and, subject to Section 11.02, each stating that all conditions precedent herein provided for relating to the satisfaction and discharge of this Indenture have been complied with. SECTION 4.02 APPLICATION OF TRUST MONEY. All moneys deposited with the Indenture Trustee pursuant to Section 4.01 hereof shall be held in trust and (a) applied by it in accordance with the provisions of the Notes and this Indenture to the payment, either directly or through any Paying Agent, as the Indenture Trustee may determine, to the Holders of the particular Notes for the payment of which such moneys have been deposited with the Indenture Trustee, of all sums due and to become due thereon for principal and interest, (b) applied by it in accordance with the provisions of the Interest Rate Swap Agreement, the Sale and Servicing Agreement and this Indenture to the payment, either directly or through any Paying Agent, as the Indenture Trustee may determine, to the Swap Counterparty any Swap Payments Outgoing or Swap Termination Payment due (provided that such amounts were not deducted from amounts remitted to the Collection Account by the Servicer pursuant to Section 5.04(e) of the Sale and Servicing Agreement), or (c) released to the Owner Trustee for distribution to the Certificateholder or application pursuant to the Trust Agreement or Sale and Servicing Agreement; but such moneys need not be segregated from other funds except to the extent required herein or in the Sale and Servicing Agreement or required by law. 28 SECTION 4.03 REPAYMENT OF MONEYS HELD BY PAYING AGENT. In connection with the satisfaction and discharge of this Indenture with respect to the Notes, all moneys then held by any Paying Agent other than the Indenture Trustee under the provisions of this Indenture with respect to such Notes shall, upon demand of the Issuer, be paid to the Indenture Trustee to be held and applied according to Section 3.03 or 4.02 and thereupon such Paying Agent shall be released from all further liability with respect to such moneys. ARTICLE V REMEDIES SECTION 5.01 EVENTS OF DEFAULT. "Event of Default," wherever used herein, means any one of the following events (whatever the reason for such Event of Default and whether it shall be voluntary or involuntary or be effected by operation of law or pursuant to any judgment, decree or order of any court or any order, rule or regulation of any administrative or governmental body): (a) default in the payment of any interest on any Class A Note when the same becomes due and payable, and such default shall continue for a period of five days; or (b) default in the payment of the principal of or any installment of the principal of any Note when the same becomes due and payable; or (c) default in the observance or performance of any covenant or agreement of the Issuer made in this Indenture (other than a covenant or agreement, a default in the observance or performance of which is elsewhere in this Section specifically dealt with) which shall continue or not be cured for a period of 90 days after there shall have been given, by registered or certified mail, to the Issuer by the Indenture Trustee or to the Issuer and the Indenture Trustee by the Holders of at least 25% of the Outstanding Amount of the Notes acting together as a single class, a written notice specifying such default and requiring it to be remedied and stating that such notice is a notice of Default hereunder; (d) any representation or warranty of the Issuer made in this Indenture or in any certificate or other writing delivered pursuant hereto or in connection herewith shall prove to have been incorrect in any material respect as of the time when the same shall have been made, and such default shall continue or not be cured, or the circumstance or condition in respect of which such misrepresentation or warranty was incorrect shall not have been eliminated or otherwise cured, for a period of 30 days after there shall have been given, by registered or certified mail, to the Issuer by the Indenture Trustee or to the Issuer and the Indenture Trustee by the Holders of at least 25% of the Outstanding Amount of the Notes acting together as a single class, a written notice specifying such incorrect representation or warranty and requiring it to be remedied and stating that such notice is a notice of Default hereunder; or (e) the filing of a decree or order for relief by a court having jurisdiction in the premises in respect of the Issuer or any substantial part of the Trust Estate in an involuntary case under any applicable federal or state bankruptcy, insolvency or other similar law now or 29 hereafter in effect, or appointing a receiver, liquidator, assignee, custodian, trustee, sequestrator or similar official of the Issuer or for any substantial part of the Trust Estate, or ordering the winding-up or liquidation of the Issuer's affairs, and such decree or order shall remain unstayed and in effect for a period of 90 consecutive days; (f) the commencement by the Issuer of a voluntary case under any applicable federal or state bankruptcy, insolvency or other similar law now or hereafter in effect, or the consent by the Issuer to the entry of an order for relief in an involuntary case under any such law, or the consent by the Issuer to the appointment or taking possession by a receiver, liquidator, assignee, custodian, trustee, sequestrator or similar official of the Issuer or for any substantial part of the Trust Estate, or the making by the Issuer of any general assignment for the benefit of creditors, or the failure by the Issuer generally to pay its debts as such debts become due, or the taking of any action by the Issuer in furtherance of any of the foregoing; or (g) termination of the Interest Rate Swap Agreement on the Early Termination Date (as defined in the Interest Rate Swap Agreement), without the execution by the Trust and a replacement Swap Counterparty of a replacement Interest Rate Swap Agreement with substantially the same terms as the Interest Rate Swap Agreement and acceptable to the Issuer and the Indenture Trustee and the assignment of such replacement Interest Rate Swap Agreement to the Indenture Trustee. For purposes of determining whether an Event of Default pursuant to Section 5.01(b) has occurred, the amount of principal required to be paid to the Holders of any Class of Notes on any Payment Date is the amount available to be paid thereto as principal pursuant to Sections 5.06(c) and (d) of the Sale and Servicing Agreement; provided however that (i) the Class A-1 Notes are required to be paid in full on or before the Class A-1 Final Scheduled Payment Date, meaning that Holders of Class A-1 Notes are entitled to have received on or before such date payments in respect of principal in an aggregate amount equal to the Class A-1 Initial Principal Balance together with all interest accrued thereon through such date; (ii) the Class A-2 Notes are required to be paid in full on or before the Class A-2 Final Scheduled Payment Date, meaning that Holders of Class A-2 Notes are entitled to have received on or before such date payments in respect of principal in an aggregate amount equal to the Class A-2 Initial Principal Balance together with all interest accrued thereon through such date, (iii) the Class A-3 Notes are required to be paid in full on or before the Class A-3 Final Scheduled Payment Date, meaning that Holders of Class A-3 Notes are entitled to have received on or before such date payments in respect of principal in an aggregate amount equal to the Class A-3 Initial Principal Balance together with all interest accrued thereon through such date and (iv) the Class A-4 Notes are required to be paid in full on or before the Class A-4 Final Scheduled Payment Date, meaning that Holders of Class A-4 Notes are entitled to have received on or before such date payments in respect of principal in an aggregate amount equal to the Class A-4 Initial Principal Balance together with all interest accrued thereon through such date. The Issuer shall deliver to the Indenture Trustee and the Swap Counterparty, within five days after the occurrence thereof, written notice in the form of an Officer's Certificate of any Default which with the giving of notice or the lapse of time would become an Event of Default under clause (c), the status of such Default and any action the Issuer is taking or proposes to take with respect thereto. 30 SECTION 5.02 ACCELERATION OF MATURITY; RESCISSION AND ANNULMENT. If an Event of Default should occur and be continuing, then and in every such case the Indenture Trustee or the Holders of at least 51% of the Outstanding Amount of the Class A Notes acting together as a single Class (excluding for such purposes the outstanding principal amount of any Notes held of record or beneficially owned by TMCC, TAFR LLC or any of their Affiliates), may, without the consent of the Certificateholder, declare all the Notes to be immediately due and payable, by a notice in writing to the Issuer (and to the Indenture Trustee if given by Noteholders), and upon any such declaration the unpaid principal amount of such Notes, together with accrued and unpaid interest thereon through the date of acceleration, shall become immediately due and payable. At any time after such declaration of acceleration of maturity has been made and before a judgment or decree for payment of the money due has been obtained by the Indenture Trustee as hereinafter in this Article V provided, the Holders of Class A Notes representing at least 51% of the Outstanding Amount of the Class A Notes (excluding for such purposes the outstanding principal amount of any Notes held of record or beneficially owned by TMCC, TAFR LLC or any of their Affiliates), acting together as a single Class, without the consent of the Certificateholder, in each case, by written notice to the Issuer and the Indenture Trustee, may rescind and annul such declaration and its consequences if: (a) the Issuer has paid or deposited with the Indenture Trustee a sum sufficient to pay: (i) all payments of principal of and interest on the respective Class of Notes and all other amounts that would then be due hereunder (including all payments payable to the Swap Counterparty under the Interest Rate Swap Agreement) or in accordance with the terms of the Notes if the Event of Default giving rise to such acceleration had not occurred; and (ii) all sums paid or advanced by the Indenture Trustee hereunder and the reasonable compensation, expenses, disbursements and advances of the Indenture Trustee and its agents and counsel; and (b) all Events of Default, other than the nonpayment of the principal or interest of the Notes that has become due solely by such acceleration, have been cured or waived as provided in Section 5.12. No such rescission shall affect any subsequent default or impair any right consequent thereto. SECTION 5.03 COLLECTION OF INDEBTEDNESS AND SUITS FOR ENFORCEMENT BY INDENTURE TRUSTEE. (a) The Issuer covenants that if (i) Default is made in the payment of any interest on any Class A Note, so long as any amounts remain unpaid with respect to the Class A Notes, when the same becomes due and payable, and such default continues for a period of five days, or (ii) default is made in the payment of the principal of or any installment of the principal of any 31 Note when the same becomes due and payable (as described in the penultimate paragraph of Section 5.01 hereof), the Issuer will, upon demand of the Indenture Trustee, pay to the Indenture Trustee, for the benefit of the Holders of the Notes, the whole amount then due and payable on such Class of Notes for principal and interest, with interest upon the overdue principal and, to the extent payment at such rate of interest shall be legally enforceable, upon overdue installments of interest at the rate borne by the Notes and in addition thereto such further amount as shall be sufficient to cover the costs and expenses of collection, including the reasonable compensation, expenses, disbursements and advances of the Indenture Trustee and its agents and counsel. (b) In case the Issuer shall fail forthwith to pay such amounts upon such demand, the Indenture Trustee, in its own name and as trustee of an express trust, may institute a Proceeding for the collection of the sums so due and unpaid, and may prosecute such Proceeding to judgment or final decree, and may enforce the same against the Issuer or other obligor upon such Notes and collect in the manner provided by law out of the property of the Issuer or other obligor upon such Notes, wherever situated, the moneys adjudged or decreed to be payable. (c) If an Event of Default occurs and is continuing, the Indenture Trustee may, as more particularly provided in Section 5.04, in its discretion, proceed to protect and enforce its rights and the rights of the Noteholders and, incidentally thereto, the Certificateholder, by such appropriate Proceedings as the Indenture Trustee shall deem most effective to protect and enforce any such rights, whether for the specific enforcement of any covenant or agreement in this Indenture or in aid of the exercise of any power granted herein, or to enforce any other proper remedy or legal or equitable right vested in the Indenture Trustee by this Indenture or by law. (d) In case there shall be pending, relative to the Issuer or any other obligor upon the Notes or any Person having or claiming an ownership interest in the Trust Estate, Proceedings under Title 11 of the United States Code or any other applicable federal or state bankruptcy, insolvency or other similar law, or in case a receiver, assignee or trustee in bankruptcy or reorganization, liquidator, sequestrator or similar official shall have been appointed for or taken possession of the Issuer or its property or such other obligor or Person, or in case of any other comparable judicial Proceedings relative to the Issuer or other obligor upon the Notes, or to the creditors or property of the Issuer or such other obligor, then, irrespective of whether the principal of any Notes shall then be due and payable as therein expressed or by declaration or otherwise and irrespective of whether the Indenture Trustee shall have made any demand pursuant to the provisions of this Section, the Indenture Trustee shall be entitled and empowered, by intervention in such Proceedings or otherwise: (i) to file and prove a claim or claims for the whole amount of principal and interest owing and unpaid in respect of the Notes and the Certificate, and to file such other papers or documents as may be necessary or advisable in order to have the claims of the Indenture Trustee (including any claim for reasonable compensation to the Indenture Trustee and each predecessor Indenture Trustee, and their respective agents, attorneys and counsel, and for reimbursement of all expenses and liabilities incurred, and all advances made, by the Indenture Trustee and each predecessor Indenture Trustee, except as a result of negligence or bad faith) and of the Noteholders or the Certificateholder allowed in such Proceedings; 32 (ii) unless prohibited by applicable law and regulations, to vote on behalf of the Holders of Notes in any election of a trustee, a standby trustee or Person performing similar functions in any such Proceedings; (iii) to collect and receive any moneys or other property payable or deliverable on any such claims and to distribute all amounts received with respect to the claims of the Noteholders or the Certificateholder and of the Indenture Trustee on their behalf; and (iv) to file such proofs of claim and other papers or documents as may be necessary or advisable in order to have the claims of the Indenture Trustee or the Holders of Notes allowed in any judicial proceedings relative to the Issuer, its creditors and its property; and any trustee, receiver, liquidator, custodian or other similar official in any such Proceeding is hereby authorized by each of such Noteholders to make payments to the Indenture Trustee and, in the event that the Indenture Trustee shall consent to the making of payments directly to such Noteholders, to pay to the Indenture Trustee such amounts as shall be sufficient to cover reasonable compensation to the Indenture Trustee, each predecessor Indenture Trustee and their respective agents, attorneys and counsel, and all other expenses and liabilities incurred, and all advances made, by the Indenture Trustee and each predecessor Indenture Trustee except as a result of negligence or bad faith. (e) Nothing herein contained shall be deemed to authorize the Indenture Trustee to authorize or consent to or vote for or accept or adopt on behalf of any Noteholder any plan of reorganization, arrangement, adjustment or composition affecting the Notes or the rights of any Holder thereof or to authorize the Indenture Trustee to vote in respect of the claim of any Noteholder in any such proceeding except, as aforesaid, to vote for the election of a trustee in bankruptcy or similar Person. (f) All rights of action and of asserting claims under this Indenture, or under any of the Notes or the Interest Rate Swap Agreement, may be enforced by the Indenture Trustee without the possession of any of the Notes or the production thereof in any trial or other Proceedings relative thereto, and any such action or Proceedings instituted by the Indenture Trustee shall be brought in its own name as trustee of an express trust, and any recovery of judgment, subject to the payment of the expenses, disbursements and compensation of the Indenture Trustee, each predecessor Indenture Trustee and their respective agents and attorneys, shall be for the ratable benefit of the Holders of the Notes and, incidentally thereto, for the benefit of the Certificateholder. (g) In any Proceedings brought by the Indenture Trustee (and also any Proceedings involving the interpretation of any provision of this Indenture to which the Indenture Trustee shall be a party), the Indenture Trustee shall be held to represent all the Noteholders, and it shall not be necessary to make any Noteholder a party to any such Proceedings. SECTION 5.04 REMEDIES; PRIORITIES; INSOLVENCY OF SELLER. (a) If an Event of Default under Section 5.01 shall have occurred and be continuing which results in the acceleration of the Notes (whether or not the Trust Estate is sold in one or 33 more public or private sales as provided in Section 5.04(c)(iv)), and unless and until such acceleration has been rescinded, the Indenture Trustee will make payments on the Notes and the Certificate as set forth in Section 5.06(d) of the Sale and Servicing Agreement, rather than pursuant to Section 5.06(c). (b) If the Indenture Trustee, in compliance with Section 5.04(a), is deemed to have a conflict of interest under the TIA and is required to resign as Indenture Trustee hereunder, the Indenture Trustee, pursuant to Section 6.10, may appoint an indenture trustee to act separately hereunder for the Class A Notes. In the event a separate indenture trustee is appointed for the Class A Notes, so long as any amounts remain unpaid with respect to the Class A Notes, only the Indenture Trustee for the Class A Noteholders shall be entitled to waive any Event of Default or Servicer Default or exercise any remedies under this Indenture. (c) In accordance with Section 5.03, if an Event of Default shall have occurred and be continuing, the Indenture Trustee may do one or more of the following (subject to Section 5.05): (i) institute Proceedings in its own name and as trustee of an express trust for the collection of all amounts then payable on the Notes to the Swap Counterparty or under this Indenture with respect thereto, whether by declaration or otherwise, enforce any judgment obtained, and collect from the Issuer, the Swap Counterparty and any other obligor upon such Notes moneys adjudged due; (ii) institute Proceedings from time to time for the complete or partial foreclosure of this Indenture with respect to the Trust Estate; (iii) exercise any remedies of a secured party under the UCC and take any other appropriate action to protect and enforce the rights and remedies of the Indenture Trustee and the Noteholders; and (iv) sell the Trust Estate or any portion thereof or rights or interest therein, at one or more public or private sales called and conducted in any manner permitted by law; PROVIDED, HOWEVER, that, notwithstanding anything in this Indenture to the contrary, the Indenture Trustee may not sell or otherwise liquidate the Trust Estate following an Event of Default, other than an Event of Default described in Section 5.01(a) or (b), unless (A) the Holders of 100% of the Outstanding Amount of the Class A Notes consent thereto or (B) the proceeds of such sale or liquidation distributable to the Noteholders are sufficient to discharge in full all amounts then due and unpaid upon such Notes for principal and interest or (C) the Indenture Trustee determines that the Trust Estate will not continue to provide sufficient funds on an ongoing basis to make all payments of principal of and interest on the Notes as they would have become due if the Notes had not been declared due and payable, and the Indenture Trustee obtains the consent of Holders of 66-2/3% of the Outstanding Amount of the Class A Notes (acting together as a single class). In determining such sufficiency or insufficiency with respect to clause (B) and (C), the Indenture Trustee may, but need not, obtain and rely upon an opinion of an Independent investment banking or accounting firm of national reputation as to the feasibility of such proposed action and as to the sufficiency of the Trust Estate for such purpose. In connection with any such sale, the Indenture Trustee will afford the Holders of each 34 Class of Notes adequate advance notice and information as to the conduct of such sale such that any such Holders (acting individually, as Classes, as a single Class or otherwise) will be reasonably able to submit bids for the purchase of the assets to be liquidated, and that the Indenture Trustee will consider any and all such bids on the same basis that it considers any other bids submitted by any other party or parties. The proceeds of such sale or liquidation (net of the expenses incurred by the Indenture Trustee in connection with the conduct thereof, which will be retained by the Indenture Trustee from such proceeds) will be treated as collections and deposited into the Collection Account by the Indenture Trustee for distribution to the Noteholders and the Certificateholder in accordance with the priorities specified in Section 5.06(d) of the Sale and Servicing Agreement. The Indenture Trustee will have no liability with respect to the amount of such proceeds or the adequacy thereof to make payments in full of any Class of Notes or the Certificate. The Indenture Trustee may fix a record date and payment date for any payment to Noteholders pursuant to this Section. At least 15 days before such record date, the Issuer shall mail to each Noteholder and the Indenture Trustee a notice that states the related record date, payment date and amount to be paid. (d) If an Insolvency Event occurs with respect to the Seller, the Indenture Trustee (or the Indenture Trustee for the Class A Notes, pursuant to Section 5.04(c)) will sell the Trust Estate or any portion thereof or rights or interest therein, at one or more public or private sales called and conducted in any manner permitted by law and in a commercially reasonable manner and on commercially reasonable terms in accordance with the provisions of Section 9.02 of the Trust Agreement; PROVIDED, HOWEVER, that the Indenture Trustee (or the Indenture Trustee for the Class A Notes, pursuant to Section 5.04(c)) may not sell or otherwise liquidate the Trust Estate in connection with such event if, prior to the termination of the Trust Agreement pursuant to Section 9.02 of the Trust Agreement, the Holders of at least 51% of the Outstanding Amount of the Class A Notes so long as any amounts remain unpaid with respect to such Notes (excluding from such action and calculation all Notes held by TMCC, TAFR LLC or any of their Affiliates) notify the Indenture Trustee in writing that they disapprove of such sale or liquidation and the termination of trusts created hereby in connection therewith; and PROVIDED, FURTHER, that in connection with any such sale the Indenture Trustee will afford the Holders of each Class of Notes adequate advance notice and information as to the conduct of such sale such that any such Holders (acting individually, as Classes, as a single Class or otherwise) will be reasonably able to submit bids for the purchase of the assets to be liquidated, and that the Indenture Trustee will consider any and all such bids on the same basis that it considers any other bids submitted by any other party or parties. The proceeds of such sale or liquidation (net of the expenses incurred by the Indenture Trustee in connection with the conduct thereof, which will be retained by the Indenture Trustee from such proceeds) will be treated as collections and deposited into the Collection Account by the Indenture Trustee for distribution to the Noteholders and Certificateholders in accordance with the priorities specified in Section 5.06(d) of the Sale and Servicing Agreement. The Indenture Trustee will have no liability with respect to the amount of such proceeds or the adequacy thereof to make payments in full of any Class of Notes or the Certificate. The Indenture Trustee may, but need not, obtain and rely upon an opinion of an Independent investment banking or accounting firm of national reputation as to the commercial reasonableness of the conduct of any such sale or liquidation and as to the expenses incurred by 35 the Indenture Trustee in connection therewith, the costs of which may be retained by the Indenture Trustee from the proceeds of such sale or liquidation. SECTION 5.05 OPTIONAL PRESERVATION OF THE RECEIVABLES. Except as provided in Section 5.04(c)(iv), if the Notes have been declared to be due and payable under Section 5.02 following an Event of Default and such declaration and its consequences have not been rescinded and annulled, the Indenture Trustee may, unless otherwise directed by the Holders of at least 51% of the Outstanding Amount of the Class A Notes, acting together as a single class (excluding from such action and calculation all Notes held by TMCC, TAFR LLC or any of their Affiliates), but need not, elect to maintain possession of the Trust Estate and direct the Issuer, Servicer and Administrator not to take steps to liquidate the Receivables. It is the desire of the parties hereto, the Swap Counterparty and the Noteholders that there be at all times sufficient funds for the payment of any obligations under the Interest Rate Swap Agreement to the Swap Counterparty and principal of and interest on the Notes, and the Indenture Trustee shall take such desire into account when determining whether or not to maintain possession of the Trust Estate. In determining whether to maintain possession of the Trust Estate, the Indenture Trustee may, but need not, obtain and rely upon an opinion of an Independent investment banking or accounting firm of national reputation as to the feasibility of such proposed action and as to the sufficiency of the Trust Estate for such purpose. SECTION 5.06 LIMITATION OF SUITS. No Holder of any Note shall have any right to institute any Proceeding, judicial or otherwise, with respect to this Indenture or for the appointment of a receiver or trustee, or for any other remedy hereunder, unless such Holder has previously given written notice to the Indenture Trustee of a continuing Event of Default, and: (a) the Event of Default arises from the Servicer's failure to remit payments when due or (b) the Holders of not less than 25% of the Outstanding Amount of the Class A Notes, acting together as a single class, have made written request to the Indenture Trustee to institute such Proceeding in respect of such Event of Default in its own name as Indenture Trustee hereunder and have offered to the Indenture Trustee reasonable indemnity against the costs, expenses and liabilities to be incurred in complying with such request and the Indenture Trustee for 30 days after its receipt of such notice, request and offer of indemnity has failed to institute such Proceedings. It is understood and intended that no one or more Holders of Notes shall have any right in any manner whatever by virtue of, or by availing of, any provision of this Indenture to affect, disturb or prejudice the rights of any other Holders of Notes or to obtain or to seek to obtain priority or preference over any other Holders or to enforce any right under this Indenture, except in the manner herein provided. SECTION 5.07 UNCONDITIONAL RIGHTS OF NOTEHOLDERS TO RECEIVE PRINCIPAL AND INTEREST. Notwithstanding any other provisions in this Indenture, the Holder of any Note shall have the right, which is absolute and unconditional, to receive payment of the principal of and interest, if any, on such Note on or after the respective due dates thereof expressed in such Note and in this Indenture (in each case with reference to the calculations to be made pursuant to the 36 Sale and Servicing Agreement) and to institute suit for the enforcement of any such payment, and such right shall not be impaired without the consent of such Holder. SECTION 5.08 RESTORATION OF RIGHTS AND REMEDIES. If the Indenture Trustee or any Noteholder has instituted any Proceeding to enforce any right or remedy under this Indenture and such Proceeding has been discontinued or abandoned for any reason or has been determined adversely to the Indenture Trustee or to such Noteholder, then and in every such case the Issuer, the Indenture Trustee and the Noteholders shall, subject to any determination in such Proceeding, be restored severally and respectively to their former positions hereunder, and thereafter all rights and remedies of the Indenture Trustee and the Noteholders shall continue as though no such Proceeding had been instituted. SECTION 5.09 RIGHTS AND REMEDIES CUMULATIVE. No right or remedy herein conferred upon or reserved to the Indenture Trustee or to the Noteholders is intended to be exclusive of any other right or remedy, and every right and remedy shall, to the extent permitted by law, be cumulative and in addition to every other right and remedy given hereunder or now or hereafter existing at law or in equity or otherwise. The assertion or employment of any right or remedy hereunder, or otherwise, shall not prevent the concurrent assertion or employment of any other appropriate right or remedy. SECTION 5.10 DELAY OR OMISSION NOT A WAIVER. No delay or omission of the Indenture Trustee or any Holder of any Note to exercise any right or remedy accruing upon any Default or Event of Default shall impair any such right or remedy or constitute a waiver of any such Default or Event of Default or an acquiescence therein. Every right and remedy given by this Article V or by law to the Indenture Trustee or to the Noteholders may be exercised from time to time, and as often as may be deemed expedient, by the Indenture Trustee or by the Noteholders, as the case may be. SECTION 5.11 CONTROL BY NOTEHOLDERS. The Holders of at least 51% of the Outstanding Amount of the Class A Notes, acting together as a single class, shall have the right to direct the time, method and place of conducting any Proceeding for any remedy available to the Indenture Trustee with respect to the Notes or exercising any trust or power conferred on the Indenture Trustee; provided that: (i) such direction shall not be in conflict with any rule of law or with this Indenture; (ii) any direction to the Indenture Trustee to sell or liquidate the Trust Estate shall be by Holders of Notes representing not less than percentages of the Outstanding Amount of the Notes of the relevant Class set forth in Section 5.04 or 5.05, as applicable (excluding for such purposes the outstanding principal amount of any Notes held of record or beneficially owned by TMCC, TAFR LLC or any of their Affiliates); and (iii) the Indenture Trustee may take any other action deemed proper by the Indenture Trustee that is not inconsistent with such direction. 37 Notwithstanding the rights of Noteholders set forth in this Section, subject to Sections 5.07 and 6.01, the Indenture Trustee need not take any action that it determines would be illegal or may not lawfully be taken, might subject it to personal liability or would be unduly prejudicial to the rights of any Noteholders not consenting to such action. SECTION 5.12 WAIVER OF PAST DEFAULTS. Prior to the declaration of the acceleration of the maturity of the Notes as provided in Section 5.02 or the liquidation or sale of the Trust Estate pursuant to Section 5.04, the Holders of Class A Notes representing at least 51% of the Outstanding Amount of the Class A Notes (acting together as a single Class), without the consent of the Holder of the Certificate (excluding for such purposes the outstanding principal amount of any Notes held of record or beneficially owned by TMCC, TAFR LLC or any of their Affiliates); may waive any past Default, Event of Default or Servicer Default and its consequences except a (a) Servicer Default in the deposit of collections or other required amounts into the Collection Account, Principal Distribution Account, Payahead Account or Reserve Fund, or (b) Default in respect of a covenant or provision hereof that cannot be modified or amended without the consent of the Holder of each Note. In the case of any such waiver, the Issuer, the Indenture Trustee and the Holders of the Notes shall be restored to their former positions and rights hereunder, respectively; but no such waiver shall extend to any subsequent or other Default or impair any right consequent thereto. Upon any such waiver, such Default shall cease to exist and be deemed to have been cured and not to have occurred, and any Event of Default arising therefrom shall be deemed to have been cured and not to have occurred, for every purpose of this Indenture; but no such waiver shall extend to any subsequent or other Default or Event of Default or impair any right consequent thereto. SECTION 5.13 UNDERTAKING FOR COSTS. All parties to this Indenture agree, and each Holder of any Note or Note Owner by such Holder's acceptance of such Note or beneficial interest therein, as the case may be, shall be deemed to have agreed, that any court may in its discretion require, in any suit for the enforcement of any right or remedy under this Indenture, or in any suit against the Indenture Trustee for any action taken, suffered or omitted by it as Indenture Trustee, the filing by any party litigant in such suit of an undertaking to pay the costs of such suit, and that such court may in its discretion assess reasonable costs, including reasonable attorneys' fees, against any party litigant in such suit, having due regard to the merits and good faith of the claims or defenses made by such party litigant; but the provisions of this Section shall not apply to (a) any suit instituted by the Indenture Trustee, (b) any suit instituted by any Noteholder, or group of Noteholders, in each case holding in the aggregate more than 25% of the Outstanding Amount of Notes, or (c) any suit instituted by any Noteholder for the enforcement of the payment of principal of or interest on any Note on or after the respective due dates expressed in such Note and in this Indenture. SECTION 5.14 WAIVER OF STAY OR EXTENSION LAWS. The Issuer covenants (to the extent that it may lawfully do so) that it will not at any time insist upon, or plead or in any manner whatsoever, claim or take the benefit or advantage of, any stay or extension law wherever enacted, now or at any time hereafter in force, that may affect the covenants or the performance of this Indenture; and the Issuer (to the extent that it may lawfully do so) hereby expressly waives all benefit or advantage of any such law, and covenants that it will not hinder, 38 delay or impede the execution of any power herein granted to the Indenture Trustee, but will suffer and permit the execution of every such power as though no such law had been enacted. SECTION 5.15 ACTION ON NOTES. The Indenture Trustee's right to seek and recover judgment on the Notes or under this Indenture shall not be affected by the seeking, obtaining or application of any other relief under or with respect to this Indenture. Neither the lien of this Indenture nor any rights or remedies of the Indenture Trustee or the Noteholders shall be impaired by the recovery of any judgment by the Indenture Trustee against the Issuer or by the levy of any execution under such judgment upon any portion of the Trust Estate or upon any of the assets of the Issuer. Any money or property collected by the Indenture Trustee shall be applied in accordance with Section 5.06. SECTION 5.16 PERFORMANCE AND ENFORCEMENT OF CERTAIN OBLIGATIONS. (a) Promptly following a request from the Indenture Trustee to do so and at the Administrator's expense, the Issuer shall take all such lawful action as the Indenture Trustee may request to compel or secure the performance and observance by the Seller, the Servicer and the Swap Counterparty, as applicable, of each of their obligations to the Issuer under or in connection with the Sale and Servicing Agreement and the Interest Rate Swap Agreement or by the Seller of its remedies under or in connection with the Receivables Purchase Agreement, and to exercise any and all rights, remedies, powers and privileges lawfully available to the Issuer under or in connection with the Sale and Servicing Agreement to the extent and in the manner directed by the Indenture Trustee, including the transmission of notices of default on the part of the Seller or the Servicer thereunder and the institution of legal or administrative actions or proceedings to compel or secure performance by the Seller or the Servicer of each of their respective obligations under the Sale and Servicing Agreement. (b) If an Event of Default has occurred and is continuing, the Indenture Trustee may, and at the direction (which direction shall be in writing or by telephone, confirmed in writing promptly thereafter) of the Holders of 66-2/3% of the Outstanding Amount of the Class A Notes (acting together as a single class but excluding for such purposes the outstanding principal amount of any Notes held of record or beneficially owned by TMCC, TAFR LLC or any of their Affiliates), shall exercise all rights, remedies, powers, privileges and claims of the Issuer against the Seller, the Servicer or the Swap Counterparty under or in connection with the Sale and Servicing Agreement and the Interest Rate Swap Agreement, against the Seller under or in connection with the Receivables Purchase Agreement, or against the Administrator under the Administration Agreement, including the right or power to take any action to compel or secure performance or observance by the Seller, the Servicer or the Administrator, of each of their obligations to the Issuer thereunder and to give any consent, request, notice, direction, approval, extension, or waiver thereunder and any right of the Issuer to take such action shall be suspended. 39 ARTICLE VI THE INDENTURE TRUSTEE SECTION 6.01 DUTIES OF INDENTURE TRUSTEE. (a) The Indenture Trustee, both prior to and after the occurrence of a Servicer Default under the Sale and Servicing Agreement, undertakes to perform such duties and only such duties as are specifically set forth in this Indenture. (b) The Indenture Trustee, upon receipt of all resolutions, certificates, statements, opinions, reports, documents, orders or other instruments furnished to the Indenture Trustee that shall be specifically required to be furnished pursuant to any provision of this Indenture, shall examine them to determine whether they conform on their face to the requirements of this Indenture. (c) No provision of this Indenture shall be construed to relieve the Indenture Trustee from liability for its own negligent action, its own negligent failure to act, its own bad faith or its own willful misfeasance; PROVIDED, HOWEVER, that: (i) the duties and obligations of the Indenture Trustee shall be determined solely by the express provisions of this Indenture, the Indenture Trustee shall not be liable except for the performance of such duties and obligations as are specifically set forth in this Indenture, no implied covenants or obligations shall be read into this Indenture against the Indenture Trustee, the permissive right of the Indenture Trustee to do things enumerated in this Indenture shall not be construed as a duty and, in the absence of bad faith on the part of the Indenture Trustee, the Indenture Trustee may conclusively rely, as to the truth of the statements and the correctness of the opinions expressed therein, upon any certificates or opinions furnished to the Indenture Trustee and conforming on their face to the requirements of this Indenture; (ii) the Indenture Trustee shall not be personally liable for an error of judgment made in good faith by a Trust Officer, unless it shall be proved that the Indenture Trustee was negligent in performing its duties in accordance with the terms of this Indenture; and (iii) the Indenture Trustee shall not be personally liable with respect to any action taken, suffered or omitted to be taken in good faith in accordance with the direction of the Holders of at least 51% of the Outstanding Amount of the Class A Notes (acting together as a single class but excluding for such purposes the outstanding principal amount of any Notes held of record or beneficially owned by TMCC, TAFR LLC or any of their Affiliates) relating to the time, method and place of conducting any proceeding for any remedy available to the Indenture Trustee, or exercising any trust or power conferred upon the Indenture Trustee under this Indenture. Moreover, if more than one Indenture Trustee has been appointed, each Indenture Trustee shall owe any and 40 all fiduciary duties only to the Class or Classes of Notes on whose behalf it shall have been appointed. (d) The Indenture Trustee shall not be required to expend or risk its own funds or otherwise incur financial liability in the performance of any of its duties under this Indenture, or in the exercise of any of its rights or powers, if there shall be reasonable grounds for believing that the repayment of such funds or adequate indemnity against such risk or liability is not reasonably assured to it. (e) All information obtained by the Indenture Trustee regarding the Obligors and the Receivables contained in the Trust, whether upon the exercise of its rights under this Indenture or otherwise, shall be maintained by the Indenture Trustee in confidence and shall not be disclosed to any other Person, unless such disclosure is required by any applicable law or regulation or pursuant to subpoena. (f) Pursuant to Sections 3.02 and 4.08 of the Sale and Servicing Agreement, in the event that a Trust Officer of the Indenture Trustee discovers that a representation or warranty with respect to a Receivable was incorrect as of the time specified with respect to such representation and warranty or that a covenant of the Servicer has been breached, and such incorrectness or breach materially and adversely affects the interests of the Issuer, the Indenture Trustee shall give prompt written notice to the Servicer and the Owner Trustee of such incorrectness. SECTION 6.02 RIGHTS OF INDENTURE TRUSTEE. (a) Except as otherwise provided in Section 6.01: (i) the Indenture Trustee may rely and shall be protected in acting or refraining from acting upon any resolution, Officer's Certificate, certificate of an authorized signatory, certificate of auditors or any other certificate, statement, instrument, opinion, report, notice, request, consent, order, appraisal, bond or other paper or document believed by it to be genuine and to have been signed or presented by the proper party or parties; (ii) the Indenture Trustee may consult with counsel and any Opinion of Counsel shall be full and complete authorization and protection in respect of any action taken or suffered or omitted by it under this Indenture in good faith and in accordance with such Opinion of Counsel; (iii) the Indenture Trustee shall be under no obligation to exercise any of the rights or powers vested in it by this Indenture or the Sale and Servicing Agreement, or to institute, conduct or defend any litigation under this Indenture, or in relation to this Indenture or the Sale and Servicing Agreement, at the request, order or direction of any of the Noteholders pursuant to the provisions of this Indenture or the Sale and Servicing Agreement, unless such Noteholders shall have offered to the Indenture Trustee reasonable security or indemnity against the costs, expenses and liabilities that may be incurred therein or thereby; 41 (iv) the Indenture Trustee shall not be personally liable for any action taken, suffered or omitted by it in good faith and reasonably believed by it to be authorized or within the discretion or rights or powers conferred upon it by this Indenture; (v) the Indenture Trustee shall not be bound to recalculate, reverify, or make any investigation into the facts of matters stated in any resolution, certificate, statement, instrument, opinion, report, notice, request, consent, order, approval, bond or other paper or document, unless requested in writing to do so by Holders of Notes evidencing not less than 25% of the aggregate Outstanding Amount of the Class A Notes (acting together as a single class but excluding for such purposes the outstanding principal amount of any Notes held of record or beneficially owned by TMCC, TAFR LLC or any of their Affiliates); PROVIDED, HOWEVER, that if the payment within a reasonable time to the Indenture Trustee of the costs, expenses or liabilities likely to be incurred by it in the making of such investigation is, in the opinion of the Indenture Trustee, not reasonably assured to the Indenture Trustee by the security afforded to it by the terms of this Indenture, the Indenture Trustee may require reasonable indemnity against such cost, expense or liability as a condition to so proceeding; the reasonable expense of every such examination shall be paid by the Administrator or, if paid by the Indenture Trustee, shall be reimbursed by the Administrator upon demand; and nothing in this clause shall derogate from the obligation of the Servicer to observe any applicable law prohibiting disclosure of information regarding the Obligors; and (vi) the Indenture Trustee may execute any of the trusts or powers under this Indenture or perform any duties under this Indenture either directly or by or through agents or attorneys or a custodian. (b) No Noteholder will have any right to institute any proceeding with respect to this Indenture except upon satisfying the conditions set forth in Section 5.06. SECTION 6.03 INDIVIDUAL RIGHTS OF INDENTURE TRUSTEE. The Indenture Trustee in its individual or any other capacity may become the Holder, beneficial owner or pledgee of Notes and may otherwise deal with the Issuer or its Affiliates with the same rights it would have if it were not Indenture Trustee. Any Paying Agent, Note Registrar, co-registrar or co-paying agent may do the same with like rights. However, in so doing the Indenture Trustee must comply with Sections 6.11 and 6.12. SECTION 6.04 INDENTURE TRUSTEE'S DISCLAIMER. The Indenture Trustee makes no representations as to the validity or sufficiency of this Indenture or of the Notes or the Interest Rate Swap Agreement (other than the execution by the Indenture Trustee on behalf of the Trust of, and the certificate of authentication on, the Notes), or of the Certificate. The Indenture Trustee shall have no obligation to perform any of the duties of the Servicer or the Administrator unless explicitly set forth in this Indenture. The Indenture Trustee shall at no time have any responsibility or liability for or with respect to the legality, validity and enforceability of the Notes, the Interest Rate Swap Agreement or any Receivable, any ownership interest in any Financed Vehicle, or the maintenance of any such ownership interest, or for or with respect to the efficacy of the Trust or its ability to generate the payments to be distributed to Noteholders under this Indenture or to the Swap Counterparty under the Interest Rate Swap Agreement, 42 including without limitation the validity of the assignment of the Receivables to the Trust or of any intervening assignment; the existence, condition, location and ownership of any Receivable or Financed Vehicle; the existence and enforceability of any physical damage or credit life or credit disability insurance; the existence and contents of any retail installment sales contract or any computer or other record thereof; the completeness of any retail installment sales contract; the performance or enforcement of any retail installment sales contract; the compliance by the Issuer with any covenant or the breach by the Issuer, Seller or Servicer of any warranty or representation made under this Indenture or in any Basic Document or other related document and the accuracy of any such warranty or representation prior to the Indenture Trustee's receipt of notice or other discovery of any noncompliance therewith or any breach thereof; the acts or omissions of the Issuer, Seller or the Servicer; or any action by the Indenture Trustee taken at the instruction of the Servicer; PROVIDED, HOWEVER, that the foregoing shall not relieve the Indenture Trustee of its obligation to perform its duties under this Indenture. Except with respect to a claim based on the failure of the Indenture Trustee to perform its duties under this Indenture or based on the Indenture Trustee's willful misconduct, bad faith or negligence, no recourse shall be had for any claim based on any provision of this Indenture, the Interest Rate Swap Agreement, the Notes or the Certificate or assignment thereof against the institution serving as the Indenture Trustee in its individual capacity. The Indenture Trustee shall not have any personal obligation, liability or duty whatsoever to any Noteholder, the Swap Counterparty or any other Person with respect to any such claim, and any such claim shall be asserted solely against the Issuer or any indemnitor who shall furnish indemnity as provided in this Indenture. The Indenture Trustee shall not be accountable for the use or application by the Issuer of any of the Notes or of the proceeds of such Notes, or for the use or application of any funds paid to the Servicer in respect of the Notes. SECTION 6.05 NOTICE OF DEFAULTS. If a Trust Officer of the Indenture Trustee knows that a Default has occurred and is continuing, the Indenture Trustee shall mail to each Noteholder and the Swap Counterparty notice of such Default within 10 days of the discovery thereof. Except in the case of a Default in payment of principal of or interest on any Note, the Indenture Trustee may withhold such notice if and so long as a committee of its Trust Officers in good faith determines that withholding the notice is in the interests of Noteholders. SECTION 6.06 REPORTS BY INDENTURE TRUSTEE TO HOLDERS. The Indenture Trustee shall deliver or cause to be delivered annually to each Noteholder of record such information as may be required to enable such holder to prepare its federal and state income tax returns. The Indenture Trustee shall also deliver or cause to be delivered annually to each Noteholder of record a report relating to its eligibility and qualification to continue as Indenture Trustee under this Indenture, any amounts advanced by it under this Indenture, the amount, interest rate and maturity date of certain indebtedness owed by the Issuer to such Indenture Trustee, in its individual capacity, the property and funds physically held by such Indenture Trustee in its capacity as such, and any action taken by it that materially affects the Notes and that has not been previously reported. SECTION 6.07 COMPENSATION AND INDEMNITY. The Issuer shall pay or shall cause the Servicer to pay to the Indenture Trustee from time to time reasonable compensation for its services. The Indenture Trustee's compensation shall not be limited by any law on compensation of a trustee of an express trust. The Issuer shall cause the Servicer to reimburse 43 the Indenture Trustee for all reasonable out-of-pocket expenses incurred or made by it, including costs of collection, in addition to the compensation for its services. Such expenses shall include the reasonable compensation and expenses, disbursements and advances of the Indenture Trustee's agents, counsel, accountants and experts. The Administrator shall indemnify or shall cause the Servicer to indemnify the Indenture Trustee against any and all loss, liability or expense (including reasonable attorneys' fees) incurred by it in connection with the administration of this trust and the performance of its duties hereunder. The Indenture Trustee shall notify the Administrator and the Servicer promptly of any claim for which it may seek indemnity. Failure by the Indenture Trustee to so notify the Administrator and the Servicer shall not relieve the Administrator or the Servicer of its obligations hereunder. In case any such action is brought against the Indenture Trustee under this Section 6.07 and it notifies the Administrator of the commencement thereof, the Administrator will assume the defense thereof, with counsel reasonably satisfactory to the Indenture Trustee (who may, unless there is, as evidenced by an opinion of counsel to the Indenture Trustee stating that there is an unwaivable conflict of interest, be counsel to the Administrator), and neither the Administrator nor the Servicer will be liable to the Indenture Trustee under this Section for any legal or other expenses subsequently incurred by the Indenture Trustee in connection with the defense thereof, other than reasonable costs of investigation. Neither the Administrator nor the Servicer need reimburse any expense or indemnify against any loss, liability or expense incurred by the Indenture Trustee through the Indenture Trustee's own willful misconduct, negligence or bad faith. The Administrator's payment obligations to the Indenture Trustee pursuant to this Section shall survive the discharge of this Indenture. When the Indenture Trustee incurs expenses after the occurrence of a Default specified in Section 5.01(e) or (f) or the Seller incurs expenses after the occurrence of an Insolvency Event with respect to the Seller, the expenses are intended to constitute expenses of administration under Title 11 of the United States Code or any other applicable federal or state bankruptcy, insolvency or similar law. SECTION 6.08 REPLACEMENT OF INDENTURE TRUSTEE. The Indenture Trustee may resign at any time by providing written notice of its resignation to the Issuer. The Administrator, on behalf of the Issuer, may remove the Indenture Trustee if: (a) the Indenture Trustee fails to comply with Section 6.11; (b) the Indenture Trustee is adjudged a bankrupt or insolvent; (c) a receiver or other public officer takes charge of the Indenture Trustee or its property; or (d) the Indenture Trustee otherwise becomes legally or practically incapable of fulfilling its duties hereunder. If the Indenture Trustee resigns or is removed or if a vacancy exists in the office of Indenture Trustee for any reason (the Indenture Trustee in such event being referred to herein as the retiring Indenture Trustee), the Administrator, on behalf of the Issuer, shall promptly appoint a successor Indenture Trustee. No resignation or removal of the Indenture Trustee and no 44 appointment of a successor Indenture Trustee shall become effective until the acceptance of appointment by the successor Indenture Trustee pursuant to this Section 6.08. A successor Indenture Trustee shall deliver a written acceptance of its appointment to the retiring Indenture Trustee, to the Servicer and to the Administrator. Thereupon the resignation or removal of the retiring Indenture Trustee shall become effective, and the successor Indenture Trustee shall have all the rights, powers and duties of the Indenture Trustee under this Indenture. The successor Indenture Trustee shall mail a notice of its succession to Noteholders and the Swap Counterparty. The retiring Indenture Trustee shall promptly transfer all property held by it as Indenture Trustee to the successor Indenture Trustee. If a successor Indenture Trustee does not take office within 30 days after the retiring Indenture Trustee resigns or is removed, the retiring Indenture Trustee, the Administrator or the Holders of a majority in Outstanding Amount of the Notes may petition any court of competent jurisdiction for the appointment of a successor Indenture Trustee. If the Indenture Trustee fails to comply with Section 6.11, any Noteholder may at any time thereafter petition any court of competent jurisdiction for the removal of the Indenture Trustee and the appointment of a successor Indenture Trustee. Notwithstanding the replacement of the Indenture Trustee pursuant to this Section, the Issuer's and the Administrator's obligations under Section 6.07 shall continue for the benefit of the retiring Indenture Trustee. SECTION 6.09 SUCCESSOR INDENTURE TRUSTEE BY MERGER. If the Indenture Trustee consolidates with, merges or converts into, or transfers all or substantially all its corporate trust business or assets to, another Person, the resulting, surviving or transferee corporation without any further act shall be the successor Indenture Trustee if such surviving Person or transferee corporation or bank shall be otherwise qualified and eligible under Section 6.11. The Indenture Trustee shall provide the Issuer, the Servicer and the Rating Agencies reasonable prior written notice of any such transaction. In case at the time such successor or successors by merger, conversion or consolidation to the Indenture Trustee shall succeed to the trusts created by this Indenture any of the Notes shall have been authenticated but not delivered, any such successor to the Indenture Trustee may adopt the certificate of authentication of any predecessor trustee, and deliver such Notes so authenticated; and in case at that time any of the Notes shall not have been authenticated, any successor to the Indenture Trustee may authenticate such Notes either in the name of any predecessor hereunder or in the name of the successor to the Indenture Trustee; and in all such cases such certificates shall have the full force which it is anywhere in the Notes or in this Indenture provided that the certificate of the Indenture Trustee shall have. SECTION 6.10 APPOINTMENT OF CO-INDENTURE TRUSTEE OR SEPARATE INDENTURE TRUSTEE. (a) Notwithstanding any other provisions of this Indenture, at any time, for the purpose of meeting any legal requirement of any jurisdiction in which any part of the Trust Estate may at the time be located, the Indenture Trustee shall have the power and may execute 45 and deliver all instruments to appoint one or more Persons to act as a co-trustee or co-trustees, or separate trustee or separate trustees, of all or any part of the Trust, and to vest in such Person or Persons, in such capacity and for the benefit of the Noteholders, such title to the Trust Estate, or any part hereof, and, subject to the other provisions of this Section, such powers, duties, obligations, rights and trusts as the Indenture Trustee may consider necessary or desirable. No co-trustee or separate trustee hereunder shall be required to meet the terms of eligibility as a successor trustee under Section 6.11 and no notice to Noteholders of the appointment of any co-trustee or separate trustee shall be required under Section 6.08 hereof. (b) Every separate trustee and co-trustee shall, to the extent permitted by law, be appointed and act subject to the following provisions and conditions: (i) all rights, powers, duties and obligations conferred or imposed upon the Indenture Trustee shall be conferred or imposed upon and exercised or performed by the Indenture Trustee and such separate trustee or co-trustee jointly (it being understood that such separate trustee or co-trustee is not authorized to act separately without the Indenture Trustee joining in and/or directing such act), except to the extent that under any law of any jurisdiction in which any particular act or acts are to be performed the Indenture Trustee shall be incompetent or unqualified to perform such act or acts, in which event such rights, powers, duties and obligations (including the holding of title to the Trust Estate or any portion thereof in any such jurisdiction) shall be exercised and performed singly by such separate trustee or co-trustee, but solely at the direction of the Indenture Trustee; (ii) no trustee hereunder shall be personally liable by reason of any act or omission of any other trustee hereunder; and (iii) the Indenture Trustee may at any time accept the resignation of or remove any separate trustee or co-trustee. (c) Any notice, request or other writing given to the Indenture Trustee shall be deemed to have been given to each of the then separate trustees and co-trustees as effectively as if given to each of them. Every instrument appointing any separate trustee or co-trustee shall refer to this Agreement and the conditions of this Article VI. Each separate trustee and co-trustee, upon its acceptance of the trusts thereupon conferred, shall be vested with the estates or property specified in its instrument of appointment, either jointly with the Indenture Trustee or separately, as may be provided therein, subject to all the provisions of this Indenture, including every provision of this Indenture relating to the conduct of, affecting the liability of, or affording protection to, the Indenture Trustee. Every such instrument shall be filed with the Indenture Trustee. (d) Any separate trustee or co-trustee may at any time constitute the Indenture Trustee its agent or attorney-in-fact with full power and authority, to the extent not prohibited by law, to do any lawful act under or in respect of this Agreement on its behalf and in its name. If any separate trustee or co-trustee shall die, become incapable of acting, resign or be removed, all of its estates, properties, rights, remedies and trusts shall vest in and be exercised by the 46 Indenture Trustee, to the extent permitted by law, without the appointment of a new or successor trustee. SECTION 6.11 ELIGIBILITY; DISQUALIFICATION. The Indenture Trustee shall at all times satisfy the requirements of TIA Section 310(a). The Indenture Trustee shall have a combined capital and surplus of at least $50,000,000 as set forth in its most recent published annual report of condition and it or its parent shall have a long-term debt rating of Baa3 or better by Moody's or shall otherwise be acceptable to Moody's. The Indenture Trustee shall comply with TIA Section 310(b), including the optional provision permitted by the second sentence of TIA Section 310(b)(9); provided, however, that there shall be excluded from the operation of TIA Section 310(b)(1) any indenture or indentures under which other securities of the Issuer are outstanding if the requirements for such exclusion set forth in TIA Section 310(b)(1) are met. SECTION 6.12 PREFERENTIAL COLLECTION OF CLAIMS AGAINST ISSUER. The Indenture Trustee shall comply with TIA Section 311(a), excluding any creditor relationship listed in TIA Section 311(b). An Indenture Trustee who has resigned or been removed shall be subject to TIA Section 311(a) to the extent indicated. SECTION 6.13 [RESERVED] SECTION 6.14 INTEREST RATE SWAP PROVISIONS. The Issuer has entered into the Interest Rate Swap Agreement, in a form satisfactory to the Rating Agencies, to hedge the floating rate interest expense on the Class A-2 Notes, the Class A-3 Notes and the Class A-4 Notes. The Issuer may, from time to time, enter into one or more replacement Interest Rate Swap Agreements in the event that any Interest Rate Swap Agreement is terminated prior to its scheduled expiration pursuant to a Swap Event of Default or a Swap Termination Event. All Swap Payments Outgoing and Swap Termination Payments owed by the Issuer to the Swap Counterparty will rank senior to interest payments on the Class A Notes. (a) Except as provided in Section 5.04(e) of the Sale and Servicing Agreement, the Indenture Trustee will be responsible for remitting all Swap Payments Outgoing and any Swap Termination Payments payable to the Swap Counterparty and for collecting Swap Payments Incoming and any Swap Termination Payments payable by the Swap Counterparty. (b) Upon the occurrence of (i) any Swap Event of Default arising from any action taken, or failure to act, by the Swap Counterparty, or (ii) any Swap Termination Event (except as described in the following sentence) with respect to which the Swap Counterparty is an Affected Party (as defined in the Interest Rate Swap Agreement), the Indenture Trustee may and will, at the direction of the Holders of at least 51% of the Outstanding Amount of the Class A-2 Notes, the Class A-3 Notes and the Class A-4 Notes, acting together as a single Class (excluding for such purposes the outstanding principal amount of any Notes held of record or beneficially owned by TMCC, TAFR LLC or any of their Affiliates), designate an Early Termination Date (as defined in the Interest Rate Swap Agreement) with respect to the Swap Agreement. If a Swap Termination Event occurs (i) as a result of the insolvency or bankruptcy of the Issuer or the Swap Counterparty or (ii) because the Issuer or the Swap Counterparty becomes 47 subject to registration as an "investment company" under the Investment Company Act of 1940, the Indenture Trustee will designate an Early Termination Date. (c) At least five days before the effective date of any proposed amendment or supplement to the Interest Rate Swap Agreement, the Administrator shall provide the Rating Agencies with a copy of such amendment or supplement. Unless the amendment or supplement clarifies any term or provisions, corrects any inconsistency, cures any ambiguity, or corrects any typographical error in the Interest Rate Swap Agreement, an amendment or supplement to the Interest Rate Swap Agreement will be effective only after satisfaction of the Rating Agency Condition. (d) The Administrator shall notify the Swap Counterparty of any proposed amendment or supplement to any of the Basic Documents. If such proposed amendment or supplement would adversely affect any of the Swap Counterparty's rights or obligation under the Interest Rate Swap Agreement or modify the obligations of, or impair the ability of the Issuer to fully perform any of its obligations under the Interest Rate Swap Agreement, the Administrator shall obtain the consent of the Swap Counterparty prior to the adoption of such amendment of supplement, provided, the Swap Counterparty's consent to any such amendment or supplement shall not be unreasonably withheld, and provided further, the Swap Counterparty's consent will be deemed to have been given if the Swap Counterparty does not object to writing within ten Business Days of receipt of a written request for such consent. ARTICLE VII NOTEHOLDERS' LISTS AND REPORTS SECTION 7.01 NOTE REGISTRAR TO FURNISH NAMES AND ADDRESSES OF NOTEHOLDERS. The Note Registrar shall furnish or cause to be furnished to the Indenture Trustee, Owner Trustee, Servicer or Administrator, within 15 days after receipt by the Note Registrar of a written request therefrom, a list of the names and addresses of the Noteholders of any Class as of the most recent Record Date. If three or more Holders of Notes of any Class, or one or more Holders of such Notes evidencing not less than 25% of the Outstanding Amount of such Notes (hereinafter referred to as "Applicants"), apply in writing to the Indenture Trustee, and such application states that the Applicants desire to communicate with other Noteholders with respect to their rights under this Indenture or under the Notes and such application is accompanied by a copy of the communication that such Applicants propose to transmit, then the Indenture Trustee shall, within five Business Days after the receipt of such application, afford such Applicants access, during normal business hours, to the current list of Noteholders. The Indenture Trustee may elect not to afford the requesting Noteholders access to the list of Noteholders if it agrees to mail the desired communication by proxy, on behalf of and at the expense of the requesting Noteholders, to all Noteholders. Every Noteholder, by receiving and holding a Note, agrees with the Indenture Trustee and the Issuer that none of the Indenture Trustee, the Owner Trustee, the Issuer, the Servicer or the Administrator shall be held accountable by reason of the disclosure of any such information as to the names and addresses of the Noteholders under this Indenture, regardless of the source from which such information was derived. 48 If the Indenture Trustee shall cease to be the Note Registrar, then thereafter the Administrator will furnish or cause to be furnished to the Indenture Trustee not more than five days after the most recent Record Date or at such other times as the Indenture Trustee reasonably may request in writing, a list, in such form as the Indenture Trustee reasonably may require, of the names and addresses of the Holders of Notes as of such Record Date. SECTION 7.02 PRESERVATION OF INFORMATION; COMMUNICATIONS TO NOTEHOLDERS. (a) The Indenture Trustee shall preserve, in as current a form as is reasonably practicable, the names and addresses of the Holders of Notes contained in the most recent list furnished to the Indenture Trustee as provided in Section 7.01 and the names and addresses of Holders of Notes received by the Indenture Trustee in its capacity as Note Registrar. The Indenture Trustee may destroy any list furnished to it as provided in such Section 7.01 upon receipt of a new list so furnished. (b) Noteholders may communicate pursuant to TIA Section 312(b) with other Noteholders with respect to their rights under this Indenture or under the Notes. (c) The Issuer, the Indenture Trustee and the Note Registrar shall have the protection of TIA Section 3.12(c). SECTION 7.03 REPORTS BY ISSUER. (a) The Issuer shall: (i) file with the Indenture Trustee, within 15 days after the Issuer is required to file the same with the Commission, copies of the annual reports and of the information, documents and other reports (or copies of such portions of any of the foregoing as the Commission may from time to time by rules and regulations prescribe) that the Issuer may be required to file with the Commission pursuant to Section 13 or 15(d) of the Exchange Act; (ii) file with the Indenture Trustee and the Commission in accordance with the rules and regulations prescribed from time to time by the Commission such additional information, documents and reports with respect to compliance by the Issuer with the conditions and covenants of this Indenture as may be required from time to time by such rules and regulations; and (iii) supply to the Indenture Trustee (and the Indenture Trustee shall transmit by mail to all Noteholders described in TIA Section 313(c)) such summaries of any information, documents and reports required to be filed by the Issuer pursuant to clauses (i) and (ii) of this Section 7.03(a) and by rules and regulations prescribed from time to time by the Commission. (b) Unless the Issuer otherwise determines, the fiscal year of the Issuer shall end on March 31 of each year. 49 SECTION 7.04 REPORTS BY INDENTURE TRUSTEE. If required by TIA Section 313(a), within 60 days after each March 31 beginning with 2001, the Indenture Trustee shall mail to each Noteholder as required by TIA Section 313(c) a brief report dated as of such date that complies with TIA Section 313(a). The Indenture Trustee also shall comply with TIA Section 313(b). A copy of each report at the time of its mailing to Noteholders shall be filed by the Indenture Trustee with the Commission and each stock exchange, if any, on which the Notes are listed. The Issuer shall notify the Indenture Trustee if and when the Notes are listed on any stock exchange. ARTICLE VIII ACCOUNTS, DISBURSEMENTS AND RELEASES SECTION 8.01 COLLECTION OF MONEY. Except as otherwise expressly provided herein, the Indenture Trustee may demand payment or delivery of, and shall receive and collect, directly and without intervention or assistance of any fiscal agent or other intermediary, all money and other property payable to or receivable by the Indenture Trustee pursuant to this Indenture. The Indenture Trustee shall apply all such money received by it as provided in this Indenture. Except as otherwise expressly provided in this Indenture, if any default occurs in the making of any payment or performance under any agreement or instrument that is part of the Trust Estate, the Indenture Trustee may take such action as may be appropriate to enforce such payment or performance, including the institution and prosecution of appropriate Proceedings. Any such action shall be without prejudice to any right to claim a Default or Event of Default under this Indenture and any right to proceed thereafter as provided in Article V. SECTION 8.02 TRUST ACCOUNTS. (a) On or prior to the Closing Date, the Issuer shall cause the Servicer to establish and maintain, in the name of the Indenture Trustee, for the benefit of the Noteholders and, to the extent set forth herein, the Certificateholder and the Swap Counterparty, the Collection Account and Payahead Account as provided in Section 5.01 of the Sale and Servicing Agreement. (b) On or prior to the Closing Date, the Seller shall, pursuant to the Securities Account Control Agreement, establish and maintain with the Indenture Trustee, for the benefit of the Noteholders, the Reserve Account as provided in Section 5.07 of the Sale and Servicing Agreement. Upon the execution and delivery by the parties hereto of this Indenture, the Indenture Trustee will deliver to the Securities Intermediary the Prohibition Notice provided for in the Securities Account Control Agreement. In connection with the termination of this Indenture, the Indenture Trustee will deliver to the Securities Intermediary the Rescission of Prohibition Notice provided for in the Securities Account Control Agreement. SECTION 8.03 [RESERVED]. 50 SECTION 8.04 GENERAL PROVISIONS REGARDING ACCOUNTS. (a) So long as no Default or Event of Default shall have occurred and be continuing, all or a portion of the funds in the Collection Account and Payahead Account shall be invested in Eligible Investments and reinvested by the Indenture Trustee at the written direction of the Servicer, subject to the provisions of Section 5.01 of the Sale and Servicing Agreement. All income or other gain from investments of moneys deposited in the Collection Account and Payahead Account shall be deposited by the Indenture Trustee in the Collection Account and paid to the Servicer as servicing compensation on each Payment Date, and any loss resulting from such investments in excess of such income or gain (against which such losses will first be applied) shall be charged to such account. The Servicer will not direct the Indenture Trustee to make any investment of any funds or to sell any investment held in the Collection Account or Payahead Account unless the security interest granted and perfected in such account will continue to be perfected in such investment or the proceeds of such sale, in either case without any further action by any Person, and, in connection with any direction to the Indenture Trustee to make any such investment or sale, if requested by the Indenture Trustee, the Servicer shall deliver to the Indenture Trustee an Opinion of Counsel, acceptable to the Indenture Trustee, to such effect. (b) So long as no Default or Event of Default shall have occurred and be continuing, all or a portion of the funds in the Reserve Account shall be invested in Eligible Investments and reinvested by the Indenture Trustee (by delivery to the Securities Intermediary of appropriate Entitlement Orders) at the written direction of the Seller, subject to the provisions of Section 5.07 of the Sale and Servicing Agreement and the provisions of the Securities Account Control Agreement. All income or other gain from investments of moneys deposited in the Reserve Account shall be paid by the Indenture Trustee to the Seller on each Payment Date (by delivery to the Securities Intermediary of appropriate Entitlement Orders). Subject to the right of the Indenture Trustee to make withdrawals therefrom, as directed by the Servicer, for the purposes and in the amounts set forth in Section 5.06 of the Sale and Servicing Agreement, the Reserve Account and all funds held therein shall be the property of the Seller and not the property of the Trust, the Owner Trustee or the Indenture Trustee. The Seller will grant to the Indenture Trustee, for the benefit of the Noteholders, a security interest in all funds (including Eligible Investments, but not the income from such investments) in the Reserve Account (including the Reserve Account Initial Deposit) and the proceeds thereof, and the Indenture Trustee shall have all of the rights of a secured party under the UCC with respect thereto; provided that all income from the investment of funds in the Reserve Account and the right to receive such income are retained by the Seller and are not transferred, assigned or otherwise conveyed hereunder. The Seller will not direct the Indenture Trustee to make any investment of any funds or to sell any investment held in the Reserve Account unless the security interest granted and perfected in such account will continue to be perfected in such investment or the proceeds of such sale, in either case without any further action by any Person, and, in connection with any direction to the Indenture Trustee to make any such investment or sale, if requested by the Indenture Trustee, the Seller shall deliver to the Indenture Trustee an Opinion of Counsel, acceptable to the Indenture Trustee, to such effect. (c) Subject to Section 6.01(c), the Indenture Trustee shall not in any way be held liable by reason of any insufficiency in the Collection Account, Payahead Account or Reserve 51 Account resulting from any loss on any Eligible Investment included therein at the direction of the Servicer or Seller, as the case may be, except for losses attributable to the Indenture Trustee's failure to make payments on such Eligible Investments issued by the Indenture Trustee, in its commercial capacity as principal obligor and not as trustee, in accordance with the terms thereof. (d) If (i) the Servicer or Seller shall have failed to give investment directions for any funds on deposit in the Collection Account, Payahead Account and Reserve Account, as the case may be, to the Indenture Trustee by 11:00 a.m. Eastern Time (or such other time as may be agreed by the Issuer and Indenture Trustee) on any Business Day or (ii) a Default or Event of Default shall have occurred and be continuing with respect to the Notes but the Notes shall not have been declared due and payable pursuant to Section 5.02 or (iii) if such Notes shall have been declared due and payable following an Event of Default, but amounts collected or receivable from the Trust Estate are being applied in accordance with Section 5.05 as if there had not been such a declaration, then the Indenture Trustee shall, to the fullest extent practicable, invest and reinvest funds in the Trust Accounts in one or more Eligible Investments specified in clause (h) of the definition of Eligible Investments provided in the Sale and Servicing Agreement. SECTION 8.05 RELEASE OF TRUST ESTATE. (a) Subject to the payment of its fees and expenses pursuant to Section 6.07, the Indenture Trustee may, and when required by the provisions of this Indenture shall, execute instruments to release property from the lien of this Indenture, or convey the Indenture Trustee's interest in such property, in a manner and under circumstances that are not inconsistent with the provisions of this Indenture. No party relying upon an instrument executed by the Indenture Trustee as provided in this Article VIII shall be bound to ascertain the Indenture Trustee's authority, inquire into the satisfaction of any conditions precedent or see to the application of any moneys. (b) The Indenture Trustee shall, at such time as there are no Notes outstanding, all sums due to the Swap Counterparty have been paid, and all sums due the Indenture Trustee pursuant to Section 6.07 have been paid, release any remaining portion of the Trust Estate that secured the Notes from the lien of this Indenture and release to or to the order of the Issuer or, in the case of the Reserve Account, to the Seller, entitled thereto any funds then on deposit in the Collection Account, Payahead Account and Reserve Account, as the case may be. The Indenture Trustee shall release property from the lien of this Indenture pursuant to this Section 8.05(b) only upon receipt of an Issuer Request accompanied by an Officer's Certificate, an Opinion of Counsel and (if required by the TIA) Independent Certificates in accordance with TIA Sections 314(c) and 314(d)(1) meeting the applicable requirements of Section 11.01. SECTION 8.06 OPINION OF COUNSEL. The Indenture Trustee shall receive at least seven days notice when requested by the Issuer to take any action pursuant to Section 8.05(a), accompanied by copies of any instruments involved, and the Indenture Trustee shall also require, as a condition to such action, an Opinion of Counsel, in form and substance satisfactory to the Indenture Trustee, stating the legal effect of any such action, outlining the steps required to complete the same, and concluding that all conditions precedent to the taking of such action have been complied with and such action will not materially and adversely impair the security for the 52 Notes or the rights of the Noteholders in contravention of the provisions of this Indenture; provided, however, that such Opinion of Counsel shall not be required to express an opinion as to the fair value of the Trust Estate. Counsel rendering any such opinion may rely, without independent investigation, on the accuracy and validity of any certificate or other instrument delivered to the Indenture Trustee in connection with any such action. ARTICLE IX SUPPLEMENTAL INDENTURES SECTION 9.01 SUPPLEMENTAL INDENTURES WITHOUT CONSENT OF NOTEHOLDERS. Subject to Section 9.03, without the consent of the Holders of any Notes but with prior notice to the Rating Agencies, the Issuer and the Indenture Trustee, when authorized by an Issuer Order, at any time and from time to time, may enter into one or more indentures supplemental hereto (which shall conform to the provisions of the Trust Indenture Act as in force at the date of the execution thereof), in form satisfactory to the Indenture Trustee, for any of the following purposes: (a) to correct or amplify the description of any property at any time subject to the lien of this Indenture, or better to assure, convey and confirm unto the Indenture Trustee any property subject or required to be subjected to the lien of this Indenture, or to subject to the lien of this Indenture additional property; (b) to evidence the succession, in compliance with the applicable provisions hereof, of another person to the Issuer, and the assumption by any such successor of the covenants of the Issuer herein and in the Notes contained; (c) to add to the covenants of the Issuer, for the benefit of the Holders of the Notes or the Swap Counterparty, or to surrender any right or power herein conferred upon the Issuer; (d) to convey, transfer, assign, mortgage or pledge any property to or with the Indenture Trustee; (e) to cure any ambiguity, to correct or supplement any provision herein or in any supplemental indenture that may be inconsistent with any other provision herein or in any supplemental indenture or to make any other provisions with respect to matters or questions arising under this Indenture or in any supplemental indenture to the extent such action shall not adversely affect the interests of the Holders of the Notes or the Certificate or the Swap Counterparty; (f) to evidence and provide for the acceptance of the appointment hereunder by a successor trustee with respect to the Notes and the Swap Counterparty and to add to or change any of the provisions of this Indenture as shall be necessary to facilitate the administration of the trusts hereunder by more than one trustee, pursuant to the requirements of Article VI; or (g) to modify, eliminate or add to the provisions of this Indenture to such extent as shall be necessary to effect the qualification of this Indenture under the TIA or under any similar 53 federal statute hereafter enacted and to add to this Indenture such other provisions as may be expressly required by the TIA. The Indenture Trustee is hereby authorized to join in the execution of any such supplemental indenture and to make any further appropriate agreements and stipulations that may be therein contained. SECTION 9.02 SUPPLEMENTAL INDENTURES WITH CONSENT OF NOTEHOLDERS. Subject to Sections 6.14 and 9.03, the Issuer and the Indenture Trustee, when authorized by an Issuer Order, also may, with prior notice to the Rating Agencies and with the consent of the Holders of at least 51% of the Outstanding Amount of the Class A Notes, acting together as a single Class (excluding for such purposes the outstanding principal amount of any Notes held of record or beneficially owned by TMCC, TAFR LLC or any of their Affiliates), by Action of such Holders delivered to the Issuer and the Indenture Trustee, enter into an indenture or indentures supplemental hereto for the purpose of adding any provisions to, or changing in any manner or eliminating any of the provisions of, this Indenture or of modifying in any manner the rights of the Holders of the Notes under this Indenture. The Indenture Trustee may in its discretion determine whether or not any Notes would be adversely affected by any supplemental indenture and any such determination shall be conclusive upon the Holders of all Notes, whether theretofore or thereafter authenticated and delivered hereunder. The Indenture Trustee shall not be liable for any such determination made in good faith. It shall not be necessary for any Action of Noteholders under this Section to approve the particular form of any proposed supplemental indenture, but it shall be sufficient if such Action shall approve the substance thereof. Promptly after the execution by the Issuer and the Indenture Trustee of any supplemental indenture pursuant to this Section, the Indenture Trustee shall mail to the Holders of the Notes to which such amendment or supplemental indenture relates a notice setting forth in general terms the substance of such supplemental indenture. Any failure of the Indenture Trustee to mail such notice, or any defect therein, shall not, however, in any way impair or affect the validity of any such supplemental indenture. SECTION 9.03 LIMITATIONS ON SUPPLEMENTAL INDENTURES The Issuer and the Indenture Trustee, in accordance with Sections 9.01 and 9.02 above, may enter into an indenture or indentures supplemental hereto for the purpose of adding any provisions to, or changing in any manner or eliminating any of the provisions of, this Indenture or of modifying in any manner the rights of the Holders of the Notes under this Indenture; PROVIDED, HOWEVER, that no such supplemental indenture shall, without the consent of the Holder of each Outstanding Note Swap Counterparty affected thereby: (a) change the date of payment of any installment of principal of or interest on any Note, or reduce the principal amount thereof, the Interest Rate thereon, change the provisions of this Indenture relating to the application of collections on, or the proceeds of the sale of, the Trust Estate to payment of principal of or interest on the Notes, or change any place of payment 54 where, or the coin or currency in which, any Note or the interest thereon is payable, or impair the right to institute suit for the enforcement of the provisions of this Indenture, to the extent provided in Article V, requiring the application of funds available therefor to the payment of any such amount due on the Notes on or after the respective due dates thereof; (b) reduce the percentage of the Outstanding Amount of the Notes (or the Notes of any Class, as applicable), the consent of the Holders of which is required for any such supplemental indenture, or the consent of the Holders of which is required for any waiver of compliance with certain provisions of this Indenture or certain defaults hereunder and their consequences provided for in this Indenture; (c) modify or alter the provisions of the proviso to the definition of the term "Outstanding" or; (d) reduce the percentage of the Outstanding Amount of the Notes (or the Notes of any Class, as applicable) required to direct the Indenture Trustee to direct the Issuer to sell or liquidate the Trust Estate pursuant to Section 5.04; (e) modify any provision of this Section except to increase any percentage specified herein or to provide that certain additional provisions of this Indenture or the Basic Documents cannot be modified or waived without the consent of the Holder of each Outstanding Note affected thereby; (f) modify any of the provisions of this Indenture in such manner as to affect the calculation of the amount of any payment of interest or principal due on any Note on any Payment Date (including the calculation of any of the individual components of such calculation); (g) permit the creation of any lien ranking prior to or on a parity with the lien of this Indenture with respect to any part of the Trust Estate or, except as otherwise permitted or contemplated herein, terminate the lien of this Indenture on any property at any time subject hereto or deprive the Holder of any Note of the security provided by the lien of this Indenture; or (h) modify or alter the provisions hereof regarding the voting of Notes held by the Indenture Trustee, the Owner Trustee, TMCC or any of its Affiliates or the Trust. SECTION 9.04 EXECUTION OF SUPPLEMENTAL INDENTURES. In executing, or permitting the additional trusts created by, any supplemental indenture permitted by this Article IX or the modification thereby of the trusts created by this Indenture, the Indenture Trustee shall be entitled to receive, and subject to Sections 6.01 and 6.02, shall be fully protected in relying upon, an Opinion of Counsel stating that the execution of such supplemental indenture is authorized or permitted by this Indenture. The Indenture Trustee may, but shall not be obligated to, enter into any such supplemental indenture that affects the Indenture Trustee's own rights, duties, liabilities or immunities under this Indenture or otherwise. SECTION 9.05 EFFECT OF SUPPLEMENTAL INDENTURE. Upon the execution of any supplemental indenture pursuant to the provisions hereof, this Indenture shall be and shall be deemed to be modified and amended in accordance therewith with respect to the Notes affected 55 thereby, and the respective rights, limitations of rights, obligations, duties, liabilities and immunities under this Indenture of the Indenture Trustee, the Issuer, the Holders of the Notes and the Certificateholder shall thereafter be determined, exercised and enforced hereunder subject in all respects to such modifications and amendments, and all the terms and conditions of any such supplemental indenture shall be and be deemed to be part of the terms and conditions of this Indenture for any and all purposes. SECTION 9.06 CONFORMITY WITH TRUST INDENTURE ACT. Every amendment of this Indenture and every supplemental indenture executed pursuant to this Article IX shall conform to the requirements of the Trust Indenture Act as then in effect so long as this Indenture shall then be qualified under the Trust Indenture Act. SECTION 9.07 REFERENCE IN NOTES TO SUPPLEMENTAL INDENTURES. Notes authenticated and delivered after the execution of any supplemental indenture pursuant to this Article IX may, and if required by the Indenture Trustee shall, bear a notation in form approved by the Indenture Trustee as to any matter provided for in such supplemental indenture. If the Issuer or the Indenture Trustee shall so determine, new Notes so modified as to conform, in the opinion of the Indenture Trustee and the Issuer, to any such supplemental indenture may be prepared and executed by the Issuer and authenticated and delivered by the Indenture Trustee in exchange for Outstanding Notes. ARTICLE X TERMINATION OF THE TRUST SECTION 10.01 TERMINATION OF THE TRUSTS CREATED BY INDENTURE. (a) The trusts created hereby and the respective obligations and responsibilities of the Issuer, the Administrator and the Indenture Trustee shall terminate upon (i) the purchase as of any Payment Date by the Servicer, or any successor to the Servicer, at its option of the Receivables primarily comprising the corpus of the Owner Trust Estate as described in Section 10.02, (ii) the payment to the Noteholders of all amounts required to be paid to them pursuant to this Agreement and the release to the Owner Trustee of all remaining amounts or investments on deposit in the Collection Account or Payahead Account, the payment to the Swap Counterparty all amounts required to be paid to them pursuant to the Interest Rate Swap Agreement, and the release to the Seller of the amounts held in the Reserve Account or (iii) the maturity or liquidation of the last Receivable and the disposition of all property held as part of the Owner Trust Estate; provided, however, that in no event shall the trust created by this Indenture continue beyond the expiration of 21 years from the death of the last survivor of the descendants of Joseph P. Kennedy, the late ambassador of the United States to the Court of St. James, living on the date of this Indenture. The Owner Trustee shall promptly notify the Indenture Trustee and each Rating Agency of any prospective termination pursuant to this Section. (b) Notice of any termination, specifying the Payment Date upon which the Noteholders must surrender their Notes to the Indenture Trustee for payment of the final distribution and retirement of the Notes, shall be given promptly by the Indenture Trustee (at the 56 written direction of the Administrator) by letter to Noteholders mailed not later than the 15th day and not earlier than the 30th day prior to the date on which such final distribution is expected to occur specifying (i) the Payment Date upon which final payment of the Notes shall be made upon presentation and surrender of Notes at the office of the Indenture Trustee therein specified, (ii) the amount of any such final payment and (iii) if applicable, that the Record Date otherwise applicable to such Payment Date is not applicable, payments being made only upon presentation and surrender of the Notes at the office of the Indenture Trustee therein specified. The Indenture Trustee shall give such notice to the Note Registrar (if other than the Indenture Trustee) at the time such notice is given to Noteholders. In the event such notice is given, the Seller, the Servicer, or any successor to the Servicer, or the Indenture Trustee, as the case may be, shall make deposits into the Collection Account in accordance with Section 5.02 of the Sale and Servicing Agreement, or, in the case of an optional purchase of Receivables pursuant to Section 10.02, shall deposit the amount specified in Section 10.02. Upon presentation and surrender of the Notes, the Indenture Trustee shall cause to be distributed to Noteholders amounts distributable on such Payment Date pursuant to Section 5.06 of the Sale and Servicing Agreement. SECTION 10.02 OPTIONAL PURCHASE OF ALL RECEIVABLES. If the Servicer, or any successor to the Servicer, shall notify the Swap Counterparty, the Owner Trustee and the Indenture Trustee of its intention to exercise the option granted to it in the Sale and Servicing Agreement to repurchase the outstanding Receivables primarily comprising the Owner Trust Estate, then the Owner Trustee and Indenture Trustee shall give written notice thereof to each Securityholder and the Rating Agencies as soon as practicable after their receipt of notice from the Servicer. Upon deposit by the Servicer or successor to the Servicer of the amount necessary to effect such purchase of the corpus of the Owner Trust Estate, the Indenture Trustee shall make the final distributions to the Noteholders and Certificateholders as set forth in Section 5.06 of the Sale and Servicing Agreement and Section 10.01 hereof and shall promptly transfer all of its right, title and interest in and to any amounts or investments remaining on deposit in the Collection Account and all of its rights to make withdrawals from the Payahead Account and the Reserve Account (excluding any portion thereof necessary to make distributions to Noteholders described in Section 3.03) to the Owner Trustee for the benefit of the Certificateholder and release from the lien of this Indenture all of the remaining Collateral. The Indenture Trustee shall execute, deliver and file all agreements, certificates, instruments or other documents necessary or reasonably requested by the Owner Trustee in order to effect such release and the transfer to the Owner Trustee of the Collateral. ARTICLE XI MISCELLANEOUS SECTION 11.01 COMPLIANCE CERTIFICATES AND OPINIONS, ETC. (a) Upon any application or request by the Issuer to the Indenture Trustee to take any action under any provision of this Indenture, the Issuer shall, upon written request therefor from the Indenture Trustee, furnish to the Indenture Trustee (i) an Officer's Certificate stating that all conditions precedent, if any, provided for in this Indenture relating to the proposed action have 57 been complied with, (ii) an Opinion of Counsel stating that in the opinion of such counsel all such conditions precedent, if any, have been complied with and (iii) (if required by the TIA) an Independent Certificate from a firm of certified public accountants meeting the applicable requirements of this Section, except that, in the case of any such application or request as to which the furnishing of such documents is specifically required by any provision of this Indenture, no such written request from the Indenture Trustee need be furnished (and only such expressly required documents need be delivered in connection therewith). Every certificate or opinion with respect to compliance with a condition or covenant provided for in this Indenture shall include: (i) a statement that each signatory of such certificate or opinion has read or has caused to be read such covenant or condition and the definitions herein relating thereto; (ii) a brief statement as to the nature and scope of the examination or investigation upon which the statements or opinions contained in such certificate or opinion are based; (iii) a statement that, in the opinion of each such signatory, such signatory has made such examination or investigation as is necessary to enable such signatory to express an informed opinion as to whether or not such covenant or condition has been complied with; and (iv) a statement as to whether, in the opinion of each such signatory, such condition or covenant has been complied with. (b) (i) Prior to the deposit of any Collateral or other property or securities with the Indenture Trustee that is to be made the basis for the release of any property or securities subject to the lien of this Indenture, the Issuer shall, in addition to any obligation imposed in Section 11.01(a) or elsewhere in this Indenture, furnish to the Indenture Trustee an Officer's Certificate certifying or stating the opinion of each person signing such certificate as to the fair value (within 90 days of such deposit) to the Issuer of the Collateral or other property or securities to be so deposited. (ii) Whenever the Issuer is required to furnish to the Indenture Trustee an Officer's Certificate certifying or stating the opinion of any signatory thereof as to the matters described in clause (i) above, the Issuer shall also deliver to the Indenture Trustee an Independent Certificate as to the same matters, if the fair value to the Issuer of the securities to be so deposited and of all other such securities made the basis of any such withdrawal or release since the commencement of the then-current fiscal year of the Issuer, as set forth in the certificates delivered pursuant to clause (i) above and this clause (ii), is 10% or more of the Outstanding Amount of the Notes, but such a certificate need not be furnished with respect to any securities so deposited, if the fair value thereof to the Issuer as set forth in the related Officer's Certificate is less than $25,000 or less than one percent of the Outstanding Amount of the Notes. 58 (iii) Whenever any property or securities are to be released from the lien of this Indenture, the Issuer shall also furnish to the Indenture Trustee an Officer's Certificate certifying or stating the opinion of each person signing such certificate as to the fair value (within 90 days of such release) of the property or securities proposed to be released and stating that in the opinion of such person the proposed release will not impair the security under this Indenture in contravention of the provisions hereof. SECTION 11.02 FORM OF DOCUMENTS DELIVERED TO INDENTURE TRUSTEE. In any case where several matters are required to be certified by, or covered by an opinion of, any specified Person, it is not necessary that all such matters be certified by, or covered by the opinion of, only one such Person, or that they be so certified or covered by only one document, but one such Person may certify or give an opinion with respect to some matters and one or more other such Persons as to other matters, and any such Person may certify or give an opinion as to such matters in one or several documents. Any certificate or opinion of an Authorized Officer of the Issuer may be based, insofar as it relates to legal matters, upon a certificate or opinion of, or representations by, counsel, unless such officer knows, or in the exercise of reasonable care should know, that the certificate or opinion or representations with respect to the matters upon which such officer's certificate or opinion is based are erroneous. Any such certificate of an Authorized Officer or Opinion of Counsel may be based, insofar as it relates to factual matters, upon a certificate or opinion of, or representations by, an officer or officers of the Servicer, the Seller, the Issuer or the Administrator, stating that the information with respect to such factual matters is in the possession of the Servicer, the Seller, the Issuer or the Administrator, unless such counsel knows, or in the exercise of reasonable care should know, that the certificate or opinion or representations with respect to such matters are erroneous. Where any Person is required to make, give or execute two or more applications, requests, consents, certificates, statements, opinions or other instruments under this Indenture, they may, but need not, be consolidated and form one instrument. Whenever in this Indenture, in connection with any application or certificate or report to the Indenture Trustee, it is provided that the Issuer shall deliver any document as a condition of the granting of such application, or as evidence of the Issuer's compliance with any term hereof, it is intended that the truth and accuracy, at the time of the granting of such application or at the effective date of such certificate or report (as the case may be), of the facts and opinions stated in such document shall in such case be conditions precedent to the right of the Issuer to have such application granted or to the sufficiency of such certificate or report. The foregoing shall not, however, be construed to affect the Indenture Trustee's right to rely upon the truth and accuracy of any statement or opinion contained in any such document as provided in Article VI. ` SECTION 11.03 ACTS OF NOTEHOLDERS. (a) Any request, demand, authorization, direction, notice, consent, waiver or other action provided by this Indenture to be given or taken by Noteholders may be embodied in and evidenced by one or more instruments of substantially similar tenor signed by such Noteholders in person or by agents duly appointed in writing; and except as herein otherwise expressly 59 provided such action shall become effective when such instrument or instruments are delivered to the Indenture Trustee, and, where it is hereby expressly required, to the Issuer. Such instrument or instruments (and the action embodied therein and evidenced thereby) are herein sometimes referred to as the "Action" of the Noteholders signing such instrument or instruments. Proof of execution of any such instrument or of a writing appointing any such agent shall be sufficient for any purpose of this Indenture and (subject to Section 6.01) conclusive in favor of the Indenture Trustee and the Issuer, if made in the manner provided in this Section. (b) The fact and date of the execution by any person of any such instrument or writing may be proved in any manner that the Indenture Trustee deems sufficient. (c) The ownership of Notes shall be proved by the Note Register. (d) Any request, demand, authorization, direction, notice, consent, waiver or other action by the Holder of any Notes shall bind the Holder of every Note issued upon the registration thereof or in exchange therefor or in lieu thereof, in respect of anything done, omitted or suffered to be done by the Indenture Trustee or the Issuer in reliance thereon, whether or not notation of such action is made upon such Note. SECTION 11.04 NOTICES, ETC., TO INDENTURE TRUSTEE, ISSUER AND RATING AGENCIES. Any request, demand, authorization, direction, notice, consent, waiver or Action of Noteholders or other documents provided or permitted by this Indenture shall be in writing and if such request, demand, authorization, direction, notice, consent, waiver or Action of Noteholders is to be made upon, given or furnished to or filed with: (a) the Indenture Trustee by any Noteholder or by the Issuer shall be sufficient for every purpose hereunder if made, given, furnished or filed in writing to or with the Indenture Trustee at its Corporate Trust Office, or (b) the Issuer by the Indenture Trustee or by any Noteholder shall be sufficient for every purpose hereunder if in writing and mailed first-class, postage prepaid to the Issuer addressed to: Toyota Auto Receivables 2001-B Owner Trust, 19001 South Western Avenue, Torrance, California 90509, Attention: Treasury Department, Vice President, Treasury, or at any other address previously furnished in writing to the Indenture Trustee by the Issuer or the Administrator. The Issuer shall promptly transmit any notice received by it from the Noteholders to the Indenture Trustee. Notices required to be given to the Rating Agencies by the Issuer, the Indenture Trustee or the Owner Trustee shall be in writing, personally delivered or mailed by certified mail, return receipt requested, to (i) in the case of Moody's, at the following address: Moody's Investors Service, Inc., ABS Monitoring Department, 99 Church Street, New York, New York 10007, (ii) in the case of Standard & Poor's, at the following address: Standard & Poor's Ratings Group, 26 Broadway (15th Floor), New York, New York 10004, Attention of Asset Backed Surveillance Department; or as to each of the foregoing, at such other address as shall be designated by written notice to the other parties. 60 SECTION 11.05 NOTICES TO NOTEHOLDERS; WAIVER. Where this Indenture provides for notice to Noteholders of any event, such notice shall be sufficiently given (unless otherwise herein expressly provided) (a) in the case of Book-Entry Notes, upon delivery to the Clearing Agency in writing and (b) in the case of Definitive Notes, when mailed, first-class, postage prepaid to each Noteholder affected by such event, at his address as it appears on the Note Register, in each case being delivered or mailed, as the case may be, not later than the latest date, and not earlier than the earliest date, prescribed for the giving of such notice. In any case where notice to Noteholders is given by mail, neither the failure to mail such notice nor any defect in any notice so mailed to any particular Noteholder shall affect the sufficiency of such notice with respect to other Noteholders, and any notice that is mailed in the manner herein provided shall conclusively be presumed to have been duly given. Where this Indenture provides for notice in any manner, such notice may be waived in writing by any Person entitled to receive such notice, either before or after the event, and such waiver shall be the equivalent of such notice. Waivers of notice by Noteholders shall be filed with the Indenture Trustee but such filing shall not be a condition precedent to the validity of any action taken in reliance upon such a waiver. In case, by reason of the suspension of regular mail service as a result of a strike, work stoppage or similar activity, it shall be impractical to mail notice of any event to Noteholders when such notice is required to be given pursuant to any provision of this Indenture, then any manner of giving such notice as shall be satisfactory to the Indenture Trustee shall be deemed to be a sufficient giving of such notice. Where this Indenture provides for notice to the Rating Agencies, failure to give such notice shall not affect any other rights or obligations created hereunder, and shall not under any circumstance constitute a Default or Event of Default. SECTION 11.06 ALTERNATE PAYMENT AND NOTICE PROVISIONS. Notwithstanding any provision of this Indenture or any of the Notes to the contrary, the Issuer may enter into any agreement with any Holder of a Note providing for a method of payment, or notice by the Indenture Trustee or any Paying Agent to such Holder, that is different from the methods provided for in this Indenture for such payments or notices. The Issuer will furnish to the Indenture Trustee a copy of each such agreement and the Indenture Trustee will cause payments to be made and notices to be given in accordance with such agreements. SECTION 11.07 CONFLICT WITH TRUST INDENTURE ACT. If any provision hereof limits, qualifies or conflicts with another provision hereof that is required to be included in this Indenture by any of the provisions of the Trust Indenture Act, such required provision shall control. The provisions of TIA Sections 310 through 317 that impose duties on any person (including the provisions automatically deemed included herein unless expressly excluded by this Indenture) are a part of and govern this Indenture, whether or not physically contained herein. 61 SECTION 11.08 EFFECT OF HEADINGS AND TABLE OF CONTENTS. The Article and Section headings herein and the Table of Contents are for convenience only and shall not affect the construction hereof. SECTION 11.09 SUCCESSORS AND ASSIGNS. All covenants and agreements in this Indenture and the Notes by the Issuer shall bind its successors and assigns, whether so expressed or not. All agreements of the Indenture Trustee in this Indenture shall bind its successors, co-trustees and agents. SECTION 11.10 SEVERABILITY. If any one or more of the covenants, agreements, provisions or terms of this Indenture shall be for any reason whatsoever held invalid or unenforceable in any jurisdiction, then such covenants, agreements, provisions or terms shall be deemed severable from the remaining covenants, agreements, provisions or terms of this Indenture and shall in no way affect the validity or enforceability of the other provisions of this Indenture or of the Notes or the Certificate or the rights of the Holders thereof. SECTION 11.11 BENEFITS OF INDENTURE. Nothing in this Indenture or in the Notes, express or implied, shall give to any Person, other than the parties hereto and their successors hereunder, the Owner Trustee, the Administrator, the Servicer, the Swap Counterparty and the Noteholders, and any other party secured hereunder, and any other Person with an ownership interest in any part of the Trust Estate, any benefit or any legal or equitable right, remedy or claim under this Indenture. SECTION 11.12 GOVERNING LAW. This indenture shall be governed by and construed in accordance with the laws of the state of New York, without reference to its conflict of law provisions, and the obligations, rights and remedies of the parties hereunder shall be determined in accordance with such laws. Regardless of any provision in any other agreement, for purposes of the UCC, New York shall be deemed to be the Securities Intermediary's jurisdiction. SECTION 11.13 COUNTERPARTS. This Indenture may be executed simultaneously in any number of counterparts, each of which shall be deemed to be an original, and all of which shall constitute but one and the same instrument. SECTION 11.14 RECORDING OF INDENTURE. If this Indenture is subject to recording in any appropriate public recording offices, such recording is to be effected by the Issuer and at its expense accompanied by an Opinion of Counsel (which may be counsel to the Indenture Trustee or any other counsel reasonably acceptable to the Indenture Trustee) to the effect that such recording is necessary either for the protection of the Noteholders or any other Person secured hereunder or for the enforcement of any right or remedy granted to the Indenture Trustee under this Indenture. SECTION 11.15 TRUST OBLIGATION. No recourse may be taken, directly or indirectly, with respect to the obligations of the Swap Counterparty, the Issuer, the Owner Trustee or the Indenture Trustee on the Interest Rate Swap Agreement, the Notes or the Certificate or under this Indenture or any certificate or other writing delivered in connection herewith or therewith, against (i) the Indenture Trustee or the Owner Trustee in its individual capacity, (ii) any Certificateholder or other owner of a beneficial interest in the Issuer or (iii) any partner, owner, 62 beneficiary, agent, officer, director, employee or agent of the Indenture Trustee or the Owner Trustee in its individual capacity, any Certificateholder or other owner of a beneficial interest in the Issuer, the Owner Trustee or the Indenture Trustee or of any successor or assign of the Indenture Trustee or the Owner Trustee in its individual capacity, except as any such Person may have expressly agreed (it being understood that the Indenture Trustee and the Owner Trustee, in their capacities as such, have no such obligations in their individual capacity) and except that any such partner, owner or beneficiary shall be fully liable, to the extent provided by applicable law, for any unpaid consideration for stock, unpaid capital contribution or failure to pay any installment or call owing to such entity. For all purposes of this Indenture, in the performance of any duties or obligations of the Issuer hereunder, the Owner Trustee shall be subject to, and entitled to the benefits of, the terms and provisions of Article VI, VII and VIII of the Trust Agreement. SECTION 11.16 NO PETITION. The Indenture Trustee, by entering into this Indenture, and each Noteholder (excluding for such purposes the outstanding principal amount of any Notes held of record or beneficially owned by TMCC, TAFR LLC or any of their Affiliates), by accepting a Note, hereby covenant and agree that they will not at any time institute against the Seller or the Issuer, or join in any institution against the Seller or the Issuer of, any bankruptcy, reorganization, arrangement, insolvency or liquidation proceedings, or other proceedings under any United States federal or state bankruptcy or similar law in connection with any obligations relating to the Notes, the Certificate or any of the Basic Documents. SECTION 11.17 INSPECTION. The Issuer agrees that, on reasonable prior notice, it will permit any representative of the Indenture Trustee, during the Issuer's normal business hours, to examine all the books of account, records, reports and other papers of the Issuer, to make copies and extracts therefrom, to cause (at the expense of the requesting party) such books to be audited by Independent certified public accountants, and to discuss the Issuer's affairs, finances and accounts with the Issuer's officers, employees, and Independent certified public accountants, all at such reasonable times and as often as may be reasonably requested. The Indenture Trustee shall and shall cause its representatives to hold in confidence all such information except to the extent disclosure may be required by law (and all reasonable applications for confidential treatment are unavailing) and except to the extent that the Indenture Trustee may reasonably determine that such disclosure is consistent with its obligations hereunder. 63 IN WITNESS WHEREOF, the Issuer and the Indenture Trustee have caused this Indenture to be duly executed by their respective officers, thereunto duly authorized and duly attested, all as of the day and year first above written. TOYOTA AUTO RECEIVABLES 2001-B OWNER TRUST By: FIRST UNION TRUST COMPANY, NATIONAL ASSOCIATION, not in its individual capacity but solely as Owner Trustee By: /s/ Sterling C. Correia ---------------------------- Name: Sterling C. Correia Title: Vice President WELLS FARGO BANK MINNESOTA, NATIONAL ASSOCIATION, not in its individual capacity but solely as Indenture Trustee and Securities Intermediary By: /s/ Marianna Stershic ----------------------------- Name: Marianna Stershic Title: Vice President S-1 STATE OF ____________________ COUNTY OF __________________ BEFORE ME, the undersigned authority, a Notary Public in and for said county and state, on this day personally appeared , known to me to be the person and officer whose name is subscribed to the foregoing instrument and acknowledged to me that the same was the act of the said FIRST UNION TRUST COMPANY, NATIONAL ASSOCIATION, not in its individual capacity but as Owner Trustee of the TOYOTA AUTO RECEIVABLES 2001-B OWNER TRUST, a Delaware business trust, and that such person executed the same as the act of said business trust for the purpose and consideration therein expressed, and in the capacities therein stated. GIVEN UNDER MY HAND AND SEAL OF OFFICE, this __st day of May, 2001. __________________________________________________ Notary Public in and for the State of ____________ (Seal) My commission expires: ____________________________ STATE OF ___________________ COUNTY OF __________________ BEFORE ME, the undersigned authority, a Notary Public in and for said county and state, on this day personally appeared , known to me to be the person and officer whose name is subscribed to the foregoing instrument and acknowledged to me that the same was the act of the said WELLS FARGO BANK MINNESOTA, NATIONAL ASSOCIATION, not in its individual capacity but as Indenture Trustee and Securities Intermediary in connection with the Toyota Auto Receivables 2001-B Owner Trust, a Delaware business trust, and that such person executed the same as the act of said business trust for the purpose and consideration therein expressed, and in the capacities therein stated. GIVEN UNDER MY HAND AND SEAL OF OFFICE, this __st day of May, 2001. __________________________________________________ Notary Public in and for the State of ____________ (Seal) My commission expires: ____________________________ EXHIBIT A-1 FORM OF CLASS A-1 NOTE THE PRINCIPAL OF THIS NOTE IS PAYABLE IN INSTALLMENTS AS SET FORTH HEREIN. ACCORDINGLY, THE OUTSTANDING PRINCIPAL AMOUNT OF THIS NOTE AT ANY TIME MAY BE LESS THAN THE AMOUNT SHOWN ON THE FACE HEREOF. THIS NOTE HAS NOT BEEN REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR THE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES AND MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED EXCEPT (I) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT, (II) IN A TRANSACTION (OTHER THAN A TRANSACTION IN CLAUSE (IV) BELOW) EXEMPT FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND APPLICABLE STATE AND FOREIGN SECURITIES LAWS, (III) TO ANY AFFILIATE OF TOYOTA MOTOR CREDIT CORPORATION OR (IV) TO A PERSON WHO THE TRANSFEROR OF SUCH CLASS A-1 NOTE REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A UNDER THE SECURITIES ACT AND THAT IS AWARE THAT THE RESALE OR OTHER TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A OR TO AN INSTITUTIONAL "ACCREDITED INVESTOR" AS DEFINED IN RULE 501(A)(1), (2), (3) OR (7) UNDER THE SECURITIES ACT, AND IN ANY CASE MAY BE TRANSFERRED ONLY IN COMPLIANCE WITH THE PROVISIONS OF THE INDENTURE GOVERNING TRANSFER OF THE CLASS A-1 NOTES. THIS NOTE IS NOT AN OBLIGATION OF, AND WILL NOT BE INSURED OR GUARANTEED BY, ANY GOVERNMENTAL AGENCY OR TOYOTA AUTO FINANCE RECEIVABLES LLC, TOYOTA MOTOR CREDIT CORPORATION, TOYOTA MOTOR SALES, U.S.A., INC., TOYOTA FINANCIAL SERVICES CORPORATION, THE INDENTURE TRUSTEE, THE OWNER TRUSTEE OR ANY OF THEIR RESPECTIVE AFFILIATES. THE PRINCIPAL AND INTEREST ON THIS NOTE IS PAYABLE SOLELY FROM PAYMENTS ON THE RECEIVABLES AND AMOUNTS ON DEPOSIT IN THE RESERVE ACCOUNT. A-1-1 No. 1 $417,840,000.00 TOYOTA AUTO RECEIVABLES 2001-B OWNER TRUST CLASS A-1 4.300% ASSET BACKED NOTES Toyota Auto Receivables 2001-B Owner Trust, a business trust organized and existing under the laws of the State of Delaware (herein referred to as the "Issuer"), for value received, hereby promises to pay to TOYOTA MOTOR CREDIT CORPORATION, or registered assigns, the principal sum of FOUR HUNDRED SEVENTEEN MILLION, EIGHT HUNDRED FORTY THOUSAND DOLLARS ($417,840,000.00) payable on each Payment Date in an amount equal to the result obtained by multiplying (i) a fraction the numerator of which is $417,840,000.00 and the denominator of which is $417,840,000.00 by (ii) the aggregate amount, if any, payable from the Collection Account or Principal Distribution Account in respect of principal on the Class A-1 Notes pursuant to Section 3.01 of the Indenture dated as of April 1, 2001, between the Issuer and Wells Fargo Bank Minnesota, National Association, a national banking association, as Indenture Trustee (the "Indenture Trustee") and Sections 5.06(c) and 5.06(d) of the Sale and Servicing Agreement dated as of April 1, 2001, between the Issuer, TAFR LLC, as Seller, and TMCC, as Servicer (which amounts will be limited to the portion of Available Collections available to make the payments specified in such Sections); provided, however, that the entire unpaid principal amount of this Note shall be due and payable on the earlier of the Payment Date occurring in May 2002 (the "Class A-1 Final Scheduled Payment Date") and the Payment Date described in Section 10.01 of the Indenture. Capitalized terms used but not defined herein have the meanings ascribed thereto in the Indenture and the Sale and Servicing Agreement, as the case may be. The Issuer will pay interest on this Note at the rate per annum shown above on each Payment Date until the principal of this Note is paid or made available for payment, on the principal amount of this Note outstanding on the preceding Payment Date (after giving effect to all payments of principal made on the preceding Payment Date), subject to certain limitations contained in Section 3.01 of the Indenture and Sections 5.06(c) and 5.06(d) of the Sale and Servicing Agreement. Interest on this Note will accrue from, and including, each Payment Date (or, in the case of the first Payment Date, from, and including, the Closing Date) to, but excluding, the subsequent Payment Date. Interest will be computed on the basis specified in the Indenture for each Interest Period. Such principal of and interest on this Note shall be paid in the manner specified on the reverse hereof. The principal of and interest on this Note is payable in such coin or currency of the United States of America as at the time of payment is legal tender for payment of public and private debts. All payments made by the Issuer with respect to this Note shall be applied first to interest due and payable on this Note as provided above and then to the unpaid principal of this Note. Reference is made to the further provisions of this Note set forth on the reverse hereof, which shall have the same effect as though fully set forth on the face of this Note. A-1-2 Unless the certificate of authentication hereon has been executed by the Indenture Trustee whose name appears below by manual signature, this Note shall not be entitled to any benefit under the Indenture referred to on the reverse hereof, or be valid or obligatory for any purpose. A-1-3 IN WITNESS WHEREOF, the Issuer has caused this instrument to be signed, manually or in facsimile, by its Authorized Officer, as of the date set forth below. Date: May 15, 2001 TOYOTA AUTO RECEIVABLES 2001-B OWNER TRUST By: FIRST UNION TRUST COMPANY, NATIONAL ASSOCIATION not in its individual capacity but solely as Owner Trustee under the Trust Agreement, By: ------------------------------------- Authorized Signatory A-1-4 TRUSTEE'S CERTIFICATE OF AUTHENTICATION This is one of the Notes designated above and referred to in the within-mentioned Indenture. Date: May 15, 2001 WELLS FARGO BANK MINNESOTA, NATIONAL ASSOCIATION, not in its individual capacity but solely as Indenture Trustee, By: ------------------------------------ Authorized Signatory A-1-5 This Note is one of a duly authorized issue of Notes of the Issuer, designated as its 4.300% Asset Backed Notes, Class A-1 (herein called the "Class A-1 Notes"), all issued under the Indenture, to which Indenture and all indentures supplemental thereto reference is hereby made for a statement of the respective rights and obligations thereunder of the Issuer, the Indenture Trustee and the Holders of the Notes. The Class A-1 Notes are subject to all terms of the Indenture. The Class A-1 Notes, the Class A-2 Notes, the Class A-3 Notes and the Class A-4 Notes (collectively, the "Notes") are and will be equally and ratably secured by the collateral pledged as security therefor as provided in the Indenture. Principal of the Class A-1 Notes will be payable on each Payment Date in an amount described in the Indenture. "Payment Date" means the fifteenth day of each month, or, if any such date is not a Business Day, the next succeeding Business Day, commencing June 15, 2001. Notwithstanding the foregoing, the entire unpaid principal amount of the Notes shall be due and payable (i) on the date on which an Event of Default shall have occurred and be continuing and the Indenture Trustee or the Holders of at least 51% of the Outstanding Amount of the Class A Notes, acting together as a single class (but excluding for such purposes the outstanding principal amount of any Notes held of record or beneficially owned by TMCC, TAFR LLC or any of their Affiliates) have declared the Notes to be immediately due and payable in the manner provided in Section 5.02 of the Indenture, (ii) following the termination or liquidation of the Trust Estate in connection with the exercise by the Servicer of its option to purchase the Receivables pursuant to Section 9.01 of the Sale and Servicing Agreement and Section 10.02 of the Indenture or (iii) within 90 days of certain Insolvency Events with respect to TAFR LLC. All principal payments on the Class A-1 Notes shall be made pro rata to the Class A-1 Noteholders entitled thereto. Payments of interest on this Note due and payable on each Payment Date, together with the installment of principal, if any, to the extent not in full payment of this Note, shall be paid to the Person in whose name such Note (or one or more Predecessor Notes) is registered in the Note Register on the Record Date. Such payment will be made by check mailed first-class postage prepaid to such Person's address as it appears on the Note Register on such Record Date or by wire transfer to the account specified by the registered holder of any Note with a face amount of at least $10,000,000. Any reduction in the principal amount of this Note (or any one or more Predecessor Notes) effected by any payments made on any Payment Date shall be binding upon all future Holders of this Note and of any Note issued upon the registration of transfer hereof or in exchange hereof or in lieu hereof, whether or not noted hereon. If funds are expected to be available, as provided in the Indenture, for payment in full of the then remaining unpaid principal amount of this Note on a Payment Date, then the Indenture Trustee, in the name of and on behalf of the Issuer, will notify the Person who was the Registered Holder hereof as of the Record Date preceding such Payment Date by notice mailed or transmitted by facsimile prior to such Payment Date, and the amount then due and payable shall be payable only upon presentation and surrender of this Note at the Indenture Trustee's principal Corporate Trust Office or at the office of the Indenture Trustee's agent appointed for such purposes located in The City of New York. The Issuer shall pay interest on overdue installments of interest at the Class A-1 Rate to the extent lawful. A-1-6 As provided in the Indenture and subject to certain limitations set forth therein, the transfer of this Note may be registered on the Note Register upon surrender of this Note for registration of transfer at the office or agency designated by the Issuer pursuant to the Indenture, duly endorsed by, or accompanied by a written instrument of transfer in form satisfactory to the Indenture Trustee as set forth in Section 2.04 of the Indenture, and thereupon one or more new Notes of authorized denominations and in the same aggregate principal amount will be issued to the designated transferee or transferees. No service charge will be charged for any registration of transfer or exchange of this Note, but the Noteholder may be required to pay a sum sufficient to cover any tax or other governmental charge that may be imposed in connection with any such registration of transfer or exchange. Each Noteholder or Note Owner, by acceptance of a Note or, in the case of a Note Owner, a beneficial interest in a Note, covenants and agrees that no recourse may be taken, directly or indirectly, with respect to the obligations of the Issuer, the Owner Trustee or the Indenture Trustee on the Notes or under the Indenture or any certificate or other writing delivered in connection therewith, against (i) the Indenture Trustee or the Owner Trustee in its individual capacity, (ii) any owner of a beneficial interest in the Issuer or (iii) any partner, owner, beneficiary, agent, officer, director or employee of the Indenture Trustee or the Owner Trustee in its individual capacity, any holder of a beneficial interest in the Issuer, the Owner Trustee or the Indenture Trustee or of any successor or assign of the Indenture Trustee or the Owner Trustee in its individual capacity, except as any such Person may have expressly agreed (it being understood that the Indenture Trustee and the Owner Trustee, in their capacities as such, have no such obligations in their individual capacity) and except that any such partner, owner or beneficiary shall be fully liable, to the extent provided by applicable law, for any unpaid consideration for stock, unpaid capital contribution or failure to pay any installment or call owing to such entity. The Holder of this Note by its acceptance hereof agrees that, except as expressly provided in the Basic Documents, in the case of an Event of Default under the Indenture, the Holder shall have no claim against any of the foregoing for any deficiency, loss or claim therefrom; provided, however, that nothing contained herein shall be taken to prevent recourse to, and enforcement against, the assets of the Issuer for any and all liabilities, obligations and undertakings contained in the Indenture or in this Note. Each Noteholder or Note Owner that is not TMCC, TAFR LLC or an Affiliate of either of them, by acceptance of a Note or, in the case of a Note Owner, a beneficial interest in a Note, covenants and agrees by accepting the benefits of the Indenture that such Noteholder or Note Owner will not at any time institute against the Seller or the Issuer, or join in any institution against the Seller or the Issuer of, any bankruptcy, reorganization, arrangement, insolvency or liquidation proceedings under any United States federal or state bankruptcy or similar law in connection with any obligations relating to the Notes, the Indenture or the Basic Documents. The Issuer has entered into the Indenture and this Note is issued with the intention that, for federal, state and local income, single business and franchise tax purposes, the Notes will qualify as indebtedness secured by the Trust Estate. Each Noteholder, by acceptance of a Note (and each Note Owner by acceptance of a beneficial interest in a Note), agrees to treat the Notes for federal, state and local income, single business and franchise tax purposes as indebtedness. Prior to the due presentment for registration of transfer of this Note, the Issuer, the Indenture Trustee and any agent of the Issuer or the Indenture Trustee may treat the Person in whose name this Note (as of the day of determination or as of such other date as may be A-1-7 specified in the Indenture) is registered as the owner hereof for all purposes, whether or not this Note be overdue, and none of the Issuer, the Indenture Trustee or any such agent shall be affected by notice to the contrary. The Indenture permits, with certain exceptions as therein provided, the amendment thereof and the modification of the rights and obligations of the Issuer and the rights of the Holders of the Notes under the Indenture, in some cases without the consent of the Holders of any Class of Notes and in other cases with the consent of Holders of only certain Classes of Notes. Section 5.12 of the Indenture also contains provisions permitting the Holders of Notes representing specified percentages of the outstanding principal amount of the Notes of the Class or Classes specified therein, on behalf of the Holders of all the Notes of such Classes, to waive compliance by the Issuer with certain provisions of the Indenture and certain past defaults under the Indenture and their consequences. Any such consent or waiver by the Holder of this Note (or any one or more Predecessor Notes) shall be conclusive and binding upon such Holder and upon all future Holders of this Note and of any Note issued upon the registration of transfer hereof or in exchange hereof or in lieu hereof whether or not notation of such consent or waiver is made upon this Note. The Indenture also permits the Indenture Trustee to amend or waive certain terms and conditions set forth in the Indenture without the consent of Holders of the Notes issued thereunder. The term "Issuer" as used in this Note includes any successor to the Issuer under the Indenture. The Issuer is permitted by the Indenture, under certain circumstances, to merge or consolidate, subject to the rights of the Indenture Trustee and the Holders of Notes under the Indenture. The Notes are issuable only in registered form in denominations as provided in the Indenture, subject to certain limitations therein set forth. This Note and the Indenture shall be construed in accordance with the laws of the State of New York, without reference to its conflict of law provisions, and the obligations, rights and remedies of the parties hereunder and thereunder shall be determined in accordance with such laws. No reference herein to the Indenture and no provision of this Note or of the Indenture shall alter or impair the obligation of the Issuer, which is absolute and unconditional, to pay the principal of and interest on this Note at the times, place and rate, and in the coin or currency herein prescribed. A-1-8 ASSIGNMENT Social Security or taxpayer I.D. or other identifying number of assignee: - ------------------ FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto: -------------------------------------------------------------------- (name and address of assignee) the within Note and all rights thereunder, and hereby irrevocably constitutes and appoints , attorney, to transfer said Note on the books kept for registration thereof, with full power of substitution in the premises. Dated: */ --------------------- Signature Guaranteed: */ - --------------------------- */ NOTICE: The signature to this assignment must correspond with the name of the registered owner as it appears on the face of the within Note in every particular, without alteration, enlargement or any change whatever. Such signature must be guaranteed by an "eligible guarantor institution" meeting the requirements of the Note Registrar, which requirements include membership or participation in STAMP or such other "signature guarantee program" as may be determined by the Note Registrar in addition to, or in substitution for, STAMP, all in accordance with the Securities Exchange Act of 1934, as amended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o. [______] $[_____________] CUSIP No. [_______________] ISIN No. : [_______________] TOYOTA AUTO RECEIVABLES 2001-B OWNER TRUST CLASS [A-2][A-3][A-4] FLOATING RATE ASSET BACKED NOTES Toyota Auto Receivables 2001-B Owner Trust, a business trust organized and existing under the laws of the State of Delaware (herein referred to as the "Issuer"), for value received, hereby promises to pay to CEDE & CO., or registered assigns, the principal sum of [___________________________________] MILLION DOLLARS ($[_______________]) payable on each Payment Date in an amount equal to the result obtained by multiplying (i) a fraction the numerator of which is $[______________] and the denominator of which is $[______________] by (ii) the aggregate amount, if any, payable from the Collection Account or Principal Distribution Account in respect of principal on the [Class A-2][Class A-3][Class A-4] Notes pursuant to Section 3.01 of the Indenture dated as of April 1, 2001, between the Issuer and Wells Fargo Bank Minnesota, National Association, a national banking association, as Indenture Trustee (the "Indenture Trustee") and Sections 5.06(c) and 5.06(d) of the Sale and Servicing Agreement dated as of April 1, 2001, between the Issuer, TAFR LLC, as Seller, and TMCC, as Servicer (which amounts will be limited to the portion of Available Collections available to make the payments specified in such Sections); provided, however, that the entire unpaid principal amount of this Note shall be due and payable on the earlier of the Payment Date occurring in [__________] 20[__] (the "[Class A-2][Class A-3][Class A-4] Final Scheduled Payment Date") and the Payment Date described in Section 10.01 of the Indenture. Capitalized terms used but not defined herein have the meanings ascribed thereto in the Indenture and the Sale and Servicing Agreement, as the case may be. The Issuer will pay interest on this Note at the rate of one-month LIBOR/plus [___%] on each Payment Date until the principal of this Note is paid or made available for payment, on the principal amount of this Note outstanding on the preceding Payment Date (after giving effect to all payments of principal made on the preceding Payment Date), subject to certain limitations contained in Section 3.01 of the Indenture and Sections 5.06(c) and 5.06(d) of the Sale and Servicing Agreement. Interest on this Note will accrue from, and including, the Payment Date (or, in the case of the first Payment Date, from, and including, the Closing Date) to, but excluding, the subsequent Payment Date. Interest will be computed on the basis specified in the Indenture for each Interest Period. Such principal of and interest on this Note shall be paid in the manner specified on the reverse hereof. The principal of and interest on this Note is payable in such coin or currency of the United States of America as at the time of payment is legal tender for payment of public and private debts. All payments made by the Issuer with respect to this Note shall be applied first to interest due and payable on this Note as provided above and then to the unpaid principal of this Note. A-2-2 Reference is made to the further provisions of this Note set forth on the reverse hereof, which shall have the same effect as though fully set forth on the face of this Note. Unless the certificate of authentication hereon has been executed by the Indenture Trustee whose name appears below by manual signature, this Note shall not be entitled to any benefit under the Indenture referred to on the reverse hereof, or be valid or obligatory for any purpose. A-2-3 IN WITNESS WHEREOF, the Issuer has caused this instrument to be signed, manually or in facsimile, by its Authorized Officer, as of the date set forth below. Date: May 15, 2001 TOYOTA AUTO RECEIVABLES 2001-B OWNER TRUST By: FIRST UNION TRUST COMPANY, NATIONAL ASSOCIATION not in its individual capacity but solely as Owner Trustee under the Trust Agreement, By: -------------------------------------------------- Authorized Signatory A-2-4 TRUSTEE'S CERTIFICATE OF AUTHENTICATION This is one of the Notes designated above and referred to in the within-mentioned Indenture. Date: May 15, 2001 WELLS FARGO BANK MINNESOTA, NATIONAL ASSOCIATION, not in its individual capacity but solely as Indenture Trustee, By: ------------------------------------------------ Authorized Signatory A-2-5 This Note is one of a duly authorized issue of Notes of the Issuer, designated as its Floating Rate Asset Backed Notes, [Class A-2][Class A-3][Class A-4] (herein called the "[Class [A-2][A-3][Class A-4] Notes"), all issued under the Indenture, to which Indenture and all indentures supplemental thereto reference is hereby made for a statement of the respective rights and obligations thereunder of the Issuer, the Indenture Trustee and the Holders of the Notes. The [Class A-2][Class A-3][Class A-4] Notes are subject to all terms of the Indenture. The Class A-1 Notes, the Class A-2 Notes, the Class A-3 Notes and the Class A-4 Notes (collectively, the "Notes") are and will be equally and ratably secured by the collateral pledged as security therefor as provided in the Indenture. Principal of the [Class A-2][Class A-3][Class A-4] Notes will be payable on each Payment Date in an amount described in the Indenture. "Payment Date" means the fifteenth day of each month, or, if any such date is not a Business Day, the next succeeding Business Day, commencing June 15, 2001. Notwithstanding the foregoing, the entire unpaid principal amount of the Notes shall be due and payable (i) on the date on which an Event of Default shall have occurred and be continuing and the Indenture Trustee or the Holders of at least 51% of the Outstanding Amount of the Class A Notes, acting together as a single class (but excluding for such purposes the outstanding principal amount of any Notes held of record or beneficially owned by TMCC, TAFR LLC or any of their Affiliates) have declared the Notes to be immediately due and payable in the manner provided in Section 5.02 of the Indenture, (ii) following the termination or liquidation of the Trust Estate in connection with the exercise by the Servicer of its option to purchase the Receivables pursuant to Section 9.01 of the Sale and Servicing Agreement and Section 10.02 of the Indenture or (iii) within 90 days of certain Insolvency Events with respect to TAFR LLC. All principal payments on the [Class A-2][Class A-3][Class A-4] Notes shall be made pro rata to the [Class A-2][Class A-3][Class A-4] Noteholders entitled thereto. Payments of interest on this Note due and payable on each Payment Date, together with the installment of principal, if any, to the extent not in full payment of this Note, shall be paid to the Person in whose name such Note (or one or more Predecessor Notes) is registered in the Note Register on the Record Date. With respect to Notes registered on the Record Date in the name of the nominee of the Clearing Agency (initially, such nominee to be Cede & Co.), payment will be made by wire transfer in immediately available funds to the account designated by such nominee, except for the final installment of principal payable with respect to such Note on a Payment Date or on the applicable Final Scheduled Payment Date, which shall be payable as provided below. Such payment will be made by check mailed first-class postage prepaid to such Person's address as it appears on the Note Register on such Record Date or by wire transfer to the account specified by the registered holder of any Note with a face amount of at least $10,000,000. Any reduction in the principal amount of this Note (or any one or more Predecessor Notes) effected by any payments made on any Payment Date shall be binding upon all future Holders of this Note and of any Note issued upon the registration of transfer hereof or in exchange hereof or in lieu hereof, whether or not noted hereon. If funds are expected to be available, as provided in the Indenture, for payment in full of the then remaining unpaid principal amount of this Note on a Payment Date, then the Indenture Trustee, in the name of and on behalf of the Issuer, will notify the Person who was the Registered Holder hereof as of the Record Date A-2-6 preceding such Payment Date by notice mailed or transmitted by facsimile prior to such Payment Date, and the amount then due and payable shall be payable only upon presentation and surrender of this Note at the Indenture Trustee's principal Corporate Trust Office or at the office of the Indenture Trustee's agent appointed for such purposes located in The City of New York. The Issuer shall pay interest on overdue installments of interest at the [Class A-2][Class A-3][Class A-4] Rate to the extent lawful. As provided in the Indenture and subject to certain limitations set forth therein, the transfer of this Note may be registered on the Note Register upon surrender of this Note for registration of transfer at the office or agency designated by the Issuer pursuant to the Indenture, duly endorsed by, or accompanied by a written instrument of transfer in form satisfactory to the Indenture Trustee as set forth in Section 2.04 of the Indenture, and thereupon one or more new Notes of authorized denominations and in the same aggregate principal amount will be issued to the designated transferee or transferees. No service charge will be charged for any registration of transfer or exchange of this Note, but the Noteholder may be required to pay a sum sufficient to cover any tax or other governmental charge that may be imposed in connection with any such registration of transfer or exchange. Each Noteholder or Note Owner, by acceptance of a Note or, in the case of a Note Owner, a beneficial interest in a Note, covenants and agrees that no recourse may be taken, directly or indirectly, with respect to the obligations of the Issuer, the Owner Trustee or the Indenture Trustee on the Notes or under the Indenture or any certificate or other writing delivered in connection therewith, against (i) the Indenture Trustee or the Owner Trustee in its individual capacity, (ii) any owner of a beneficial interest in the Issuer or (iii) any partner, owner, beneficiary, agent, officer, director or employee of the Indenture Trustee or the Owner Trustee in its individual capacity, any holder of a beneficial interest in the Issuer, the Owner Trustee or the Indenture Trustee or of any successor or assign of the Indenture Trustee or the Owner Trustee in its individual capacity, except as any such Person may have expressly agreed (it being understood that the Indenture Trustee and the Owner Trustee, in their capacities as such, have no such obligations in their individual capacity) and except that any such partner, owner or beneficiary shall be fully liable, to the extent provided by applicable law, for any unpaid consideration for stock, unpaid capital contribution or failure to pay any installment or call owing to such entity. The Holder of this Note by its acceptance hereof agrees that, except as expressly provided in the Basic Documents, in the case of an Event of Default under the Indenture, the Holder shall have no claim against any of the foregoing for any deficiency, loss or claim therefrom; provided, however, that nothing contained herein shall be taken to prevent recourse to, and enforcement against, the assets of the Issuer for any and all liabilities, obligations and undertakings contained in the Indenture or in this Note. Each Noteholder or Note Owner, by acceptance of a Note or, in the case of a Note Owner, a beneficial interest in a Note, covenants and agrees by accepting the benefits of the Indenture that such Noteholder or Note Owner will not at any time institute against the Seller or the Issuer, or join in any institution against the Seller or the Issuer of, any bankruptcy, reorganization, arrangement, insolvency or liquidation proceedings under any United States federal or state bankruptcy or similar law in connection with any obligations relating to the Notes, the Indenture or the Basic Documents. A-2-7 The Issuer has entered into the Indenture and this Note is issued with the intention that, for federal, state and local income, single business and franchise tax purposes, the Notes will qualify as indebtedness secured by the Trust Estate. Each Noteholder, by acceptance of a Note (and each Note Owner by acceptance of a beneficial interest in a Note), agrees to treat the Notes for federal, state and local income, single business and franchise tax purposes as indebtedness. Prior to the due presentment for registration of transfer of this Note, the Issuer, the Indenture Trustee and any agent of the Issuer or the Indenture Trustee may treat the Person in whose name this Note (as of the day of determination or as of such other date as may be specified in the Indenture) is registered as the owner hereof for all purposes, whether or not this Note be overdue, and none of the Issuer, the Indenture Trustee or any such agent shall be affected by notice to the contrary. The Indenture permits, with certain exceptions as therein provided, the amendment thereof and the modification of the rights and obligations of the Issuer and the rights of the Holders of the Notes under the Indenture, in some cases without the consent of the Holders of any Class of Notes and in other cases with the consent of Holders of only certain Classes of Notes. Section 5.12 of the Indenture also contains provisions permitting the Holders of Notes representing specified percentages of the outstanding principal amount of the Notes of the Class or Classes specified therein, on behalf of the Holders of all the Notes of such Classes, to waive compliance by the Issuer with certain provisions of the Indenture and certain past defaults under the Indenture and their consequences. Any such consent or waiver by the Holder of this Note (or any one or more Predecessor Notes) shall be conclusive and binding upon such Holder and upon all future Holders of this Note and of any Note issued upon the registration of transfer hereof or in exchange hereof or in lieu hereof whether or not notation of such consent or waiver is made upon this Note. The Indenture also permits the Indenture Trustee to amend or waive certain terms and conditions set forth in the Indenture without the consent of Holders of the Notes issued thereunder. The term "Issuer" as used in this Note includes any successor to the Issuer under the Indenture. The Issuer is permitted by the Indenture, under certain circumstances, to merge or consolidate, subject to the rights of the Indenture Trustee and the Holders of Notes under the Indenture. The Notes are issuable only in registered form in denominations as provided in the Indenture, subject to certain limitations therein set forth. This Note and the Indenture shall be construed in accordance with the laws of the State of New York, without reference to its conflict of law provisions, and the obligations, rights and remedies of the parties hereunder and thereunder shall be determined in accordance with such laws. No reference herein to the Indenture and no provision of this Note or of the Indenture shall alter or impair the obligation of the Issuer, which is absolute and unconditional, to pay the principal of and interest on this Note at the times, place and rate, and in the coin or currency herein prescribed. A-2-8 ASSIGNMENT Social Security or taxpayer I.D. or other identifying number of assignee: _____________________ FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto: ________________________________________________________________________________ (name and address of assignee) the within Note and all rights thereunder, and hereby irrevocably constitutes and appoints , attorney, to transfer said Note on the books kept for registration thereof, with full power of substitution in the premises. Dated: ______________ */ Signature Guaranteed: _____________________ */ */ NOTICE: The signature to this assignment must correspond with the name of the registered owner as it appears on the face of the within Note in every particular, without alteration, enlargement or any change whatever. Such signature must be guaranteed by an "eligible guarantor institution" meeting the requirements of the Note Registrar, which requirements include membership or participation in STAMP or such other "signature guarantee program" as may be determined by the Note Registrar in addition to, or in substitution for, STAMP, all in accordance with the Securities Exchange Act of 1934, as amended. A-2-9 EXHIBIT B (Form of Note Depository Agreement) B-1-1 EX-4.3 4 a2049889zex-4_3.txt EXHIBIT 4.3 EXHIBIT 4.3 RECEIVABLES PURCHASE AGREEMENT TOYOTA MOTOR CREDIT CORPORATION, as Seller and TOYOTA AUTO FINANCE RECEIVABLES LLC, as Purchaser Dated as of April 1, 2001 TABLE OF CONTENTS
PAGE I. DEFINITIONS SECTION 1.01 Definitions...............................................................................1 SECTION 1.02 Other Definitional Provisions.............................................................4 II. CONVEYANCE OF RECEIVABLES SECTION 2.01 Conveyance of Receivables.................................................................4 SECTION 2.02 Representations and Warranties of the Seller and the Purchaser............................5 SECTION 2.03 Representations and Warranties of the Seller as to the Receivables........................8 SECTION 2.04 Covenants of the Seller..................................................................12 III. PAYMENT OF RECEIVABLES PURCHASE PRICE SECTION 3.01 Payment of Receivables Purchase Price....................................................13 IV. TERMINATION SECTION 4.01 Termination..............................................................................13 V. MISCELLANEOUS PROVISIONS SECTION 5.01 Amendment................................................................................13 SECTION 5.02 Protection of Right, Title and Interest to Receivables...................................13 SECTION 5.03 Governing Law............................................................................14 SECTION 5.04 Notices..................................................................................14 SECTION 5.05 Severability of Provisions...............................................................14 SECTION 5.06 Assignment...............................................................................15 SECTION 5.07 Further Assurances.......................................................................15 SECTION 5.08 No Waiver; Cumulative Remedies...........................................................15 SECTION 5.09 Counterparts.............................................................................15 SECTION 5.10 Third-Party Beneficiaries................................................................15 SECTION 5.11 Merger and Integration...................................................................15 SECTION 5.12 Headings.................................................................................16 SECTION 5.13 Indemnification..........................................................................16 SECTION 5.14 Merger or Consolidation of, or Assumption of the Obligations of, the Seller............16 Schedule A - Schedule of Receivables..................................................................A-1
i RECEIVABLES PURCHASE AGREEMENT, dated as of April 1, 2001, between Toyota Motor Credit Corporation, a California corporation, as seller, and Toyota Auto Finance Receivables LLC, a Delaware limited liability company, as purchaser. In consideration of the premises and mutual agreements herein contained, each party agrees as follows for the benefit of the other party and for the benefit of the Purchaser, Issuer and Indenture Trustee: ARTICLE I. DEFINITIONS SECTION 1.01 DEFINITIONS. Whenever used in this Agreement, the following words and phrases shall have the following meanings: "AGREEMENT" shall mean this Receivables Purchase Agreement and all amendments hereof and supplements hereto. "AMOUNT FINANCED" in respect of a Receivable means the aggregate amount advanced under such Receivable toward the purchase price of the related Financed Vehicle and any related costs, including but not limited to accessories, insurance premiums, service and warranty contracts and other items customarily financed as part of retail automobile and light duty truck installment sale contracts. "ANNUAL PERCENTAGE RATE" or "APR" of a Receivable means the annual rate of finance charges specified in such Receivable. "BASIC DOCUMENTS" means this Receivables Purchase Agreement, the Trust Agreement, the Sale and Servicing Agreement, the Indenture, the Administration Agreement, the Securities Account Control Agreement and the other documents and certificates delivered in connection herewith and therewith. "CLOSING DATE" shall mean May 15, 2001. "CUTOFF DATE" shall mean April 1, 2001. "DEALER RECOURSE" means, with respect to a Receivable, all recourse rights against the Dealer which originated the Receivable, and any successor Dealer. "DEFERRED PREPAYMENT" means, with respect to a Precomputed Receivable and a Collection Period, the aggregate amount, if any, of Payments Ahead remitted to the Servicer in respect of such Receivable during one or more prior Collection Periods and currently held by the Servicer or in the Payahead Account. 1 "FINANCED VEHICLE" means, with respect to a Receivable, the related automobile or light duty truck, as the case may be, together with all accessions thereto, securing the related Obligor's indebtedness under such Receivable. "INDENTURE TRUSTEE" shall mean Wells Fargo Bank Minnesota, National Association, as indenture trustee under the Indenture, or any successor trustee thereunder. "LIEN" means any security interest, lien, charge, pledge, equity or encumbrance of any kind other than tax liens, mechanics' liens and any liens that attach to a Receivable or any property, as the context may require, by operation of law. "LIQUIDATION PROCEEDS" means, with respect to a Defaulted Receivable, all amounts realized with respect to such Receivable from whatever sources (including, without limitation, proceeds of any Insurance Policy), net of amounts that are required by law or such Receivable to be refunded to the related Obligor. "OBLIGOR" on a Receivable means the purchaser or co-purchasers of the related Financed Vehicle purchased in part or in whole by the execution and delivery of such Receivable or any other Person who owes or may be liable for payments under such Receivable. "OWNER TRUSTEE" shall mean First Union Trust Company, National Association, as owner trustee under the Trust Agreement, or any successor trustee thereunder. "PURCHASER" shall mean Toyota Auto Finance Receivables LLC, in its capacity as purchaser of the Receivables under this Agreement, and its successors and assigns. "RECEIVABLE" means any retail installment sale contract executed by an Obligor in respect of a Financed Vehicle, and all proceeds thereof and payments thereunder, which Receivable shall be identified in the Schedule of Receivables. "RECEIVABLE FILE" means with respect to each Receivable: (a) the fully executed original of the Receivable; (b) documents evidencing or related to any Insurance Policy; (c) the original credit application of each Obligor, fully executed by such Obligor on TMCC's customary form, or on a form approved by TMCC, for such application; (d) the original certificate of title (or evidence that such certificate of title has been applied for) or such documents that the Servicer shall keep on file, in accordance with TMCC's customary procedures, evidencing the security interest in the related Financed Vehicle; and 2 (e) any and all other documents that the Seller or the Servicer, as the case may be, shall keep on file, in accordance with its customary procedures, relating to such Receivable or the related Obligor or Financed Vehicle. "RECEIVABLES PURCHASE PRICE" shall mean $1,545,404,749.19. "RELEASED WARRANTY AMOUNT" means, with respect to a Payment Date and to a Warranty Receivable, the Deferred Prepayment, if any, for such Warranty Receivable. "SALE AND SERVICING AGREEMENT" shall mean the Sale and Servicing Agreement dated as of April 1, 2001, by and among Toyota Auto Receivables 2001-B Owner Trust, as issuer, Toyota Auto Finance Receivables LLC, as seller, and Toyota Motor Credit Corporation, as servicer, and, as to which, the Indenture Trustee is a third party beneficiary. "SECURITIES ACCOUNT CONTROL AGREEMENT" shall have the meaning ascribed thereto in the Sale and Servicing Agreement. "SELLER" shall mean Toyota Motor Credit Corporation, in its capacity as seller of the Receivables under this Agreement, and its successors and assigns. "SCHEDULE OF RECEIVABLES" means the schedule of receivables described in Section 2.01(a) and attached as Schedule A hereto. "TRUST" means the Toyota Auto Receivables 2001-B Owner Trust, a Delaware business trust. "TRUST AGREEMENT" means the Amended and Restated Trust Agreement dated as of April 1, 2001, by and between Toyota Auto Finance Receivables LLC, as depositor, and First Union Trust Company, National Association, as Owner Trustee. "WARRANTY PURCHASE PAYMENT" means, with respect to a Payment Date and to (1) a Warranty Receivable which is a Precomputed Receivable repurchased by the Seller as of the close of business on the last day of the related Collection Period, (a) the sum of (i) all Scheduled Payments on such Receivable due after the last day of such Collection Period, (ii) all past due Scheduled Payments for which an Advance has not been made, (iii) an amount equal to any reimbursement of Outstanding Advances made pursuant to Section 5.04(b) of the Sale and Servicing Agreement with respect to such Receivable and (iv) an amount equal to all other Outstanding Advances made pursuant to Section 5.04(c) of the Sale and Servicing Agreement with respect to such Receivable, minus (b) the sum of (i) any Rebate (except to the extent specified in Section 4.03 of the Sale and Servicing Agreement) and (ii) any other proceeds in respect of such Receivable received during any Collection Period prior to or during such Collection Period (to the extent applied to reduce the Principal Balance of such Receivable on such Payment Date), and (2) a Warranty Receivable which is a Simple Interest Receivable repurchased by the Seller as of the close of business on the last day of the related Collection Period, the sum of (a) the unpaid Principal Balance owed by the Obligor in respect of such Receivable as of the last day of the related Collection Period plus (b) interest on such unpaid 3 Principal Balance at a rate equal to the related APR to the last day in the related Collection Period. "WARRANTY RECEIVABLE" means a Receivable purchased by the Seller pursuant to Section 2.03(c). SECTION 1.02 OTHER DEFINITIONAL PROVISIONS. (a) All capitalized terms not otherwise defined in this Agreement shall have the defined meanings used in the Sale and Servicing Agreement or Trust Agreement, as the case may be. (b) The words "hereof," "herein" and "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, subsection and Schedule references contained in this Agreement are references to Sections, subsections and Schedules in or to this Agreement unless otherwise specified; and the word "including" means including without limitation. ARTICLE II. CONVEYANCE OF RECEIVABLES SECTION 2.01 CONVEYANCE OF RECEIVABLES. (a) Subject to the terms and conditions of this Agreement, on the Closing Date the Seller agrees to sell to the Purchaser, and the Purchaser agrees to purchase from the Seller, without recourse (subject to the Seller's obligations hereunder): (i) all right, title and interest of the Seller in and to the Receivables listed in the Schedule of Receivables and all monies due thereon or paid thereunder or in respect thereof (including proceeds of the repurchase of Receivables by the Seller pursuant to Section 2.03(c)) on or after the Cutoff Date; (ii) the interest of the Seller in the security interests in the Financed Vehicles granted by the Obligors pursuant to the Receivables and any accessions thereto; (iii) the interest of the Seller in any proceeds of any physical damage insurance policies covering Financed Vehicles and in any proceeds of any credit life or credit disability insurance policies relating to the Receivables or the Obligors; (iv) the interest of the Seller in any Dealer Recourse; (v) the right of the Seller to realize upon any property (including the right to receive future Liquidation Proceeds) that shall have secured a Receivable and have been repossessed in accordance with the terms thereof; and (vi) all proceeds of the foregoing. 4 It is the intention of the Seller that the transfer and assignment contemplated by this Agreement shall constitute a sale of the Receivables from the Seller to the Purchaser and the beneficial interest in and title to the Receivables shall not be part of the Seller's estate in the event of the filing of a bankruptcy petition by or against the Seller under any bankruptcy law. The Seller agrees to execute and file all filings (including filings under the UCC) necessary in any jurisdiction to provide third parties with notice of the sale of the Receivables pursuant to this Agreement and to perfect such sale under the UCC. (b) In connection with the foregoing conveyance, the Seller agrees to record and file in California, at its own expense, a financing statement with respect to the Receivables necessary to provide third parties with notice of the conveyance hereunder and to perfect the sale of the Receivables to the Purchaser, and the proceeds thereof (and any continuation statements as are required by applicable state law), and to deliver a file-stamped copy of each such financing statement (or continuation statement) or other evidence of such filings (which may, for purposes of this Section, consist of telephone confirmation of such filing with the file stamped copy of each such filing to be provided to the Purchaser in due course), as soon as is practicable after receipt by the Seller thereof. In connection with the foregoing conveyance, the Seller further agrees, at its own expense, on or prior to the Closing Date (i) to annotate and indicate in its computer files that the Receivables have been transferred to the Purchaser pursuant to this Agreement, (ii) to deliver to the Purchaser a computer file or printed or microfiche list containing a true and complete list of all such Receivables, identified by account number and by the Principal Balance of each Receivable as of the Cutoff Date, which file or list shall be marked as Schedule A to this Agreement and is hereby incorporated into and made a part of this Agreement and (iii) to deliver the Receivable Files to or upon the order of the Purchaser. SECTION 2.02 REPRESENTATIONS AND WARRANTIES OF THE SELLER AND THE PURCHASER. (a) The Seller hereby represents and warrants to the Purchaser as of the date of this Agreement and the Closing Date that: (i) ORGANIZATION AND GOOD STANDING. The Seller shall have been duly organized and shall be validly existing as a corporation in good standing under the laws of the State of California, with corporate power and authority to own its properties and to conduct its business as such properties shall be currently owned and such business is presently conducted, and had at all relevant times, and shall now have, corporate power, authority and legal right to acquire, own and sell the Receivables. (ii) DUE QUALIFICATION. The Seller shall be duly qualified to do business as a foreign corporation in good standing, and shall have obtained all necessary licenses and approvals in all jurisdictions in which the ownership or lease of property or the conduct of its business shall require such qualifications and where the failure to so qualify will have a material adverse effect on the ability of the Seller to conduct its business or perform its obligations under this Agreement. 5 (iii) POWER AND AUTHORITY. The Seller shall have the corporate power and authority to execute and deliver this Agreement and to carry out its terms; and the execution, delivery and performance of this Agreement shall have been duly authorized by the Seller by all necessary corporate action. (iv) BINDING OBLIGATION. This Agreement shall constitute a legal, valid and binding obligation of the Seller enforceable in accordance with its terms, except as enforceability may be limited by bankruptcy, insolvency, reorganization, moratorium and other similar laws affecting creditors' rights generally or by general principles of equity. (v) NO VIOLATION. The consummation of the transactions contemplated by this Agreement and the fulfillment of the terms hereof shall not conflict with, result in any breach of any of the terms and provisions of, nor constitute (with or without notice or lapse of time) a default under, the articles of incorporation or bylaws of the Seller, or conflict with or breach any of the material terms or provisions of, or constitute (with or without notice or lapse of time) a default under, any indenture, agreement or other instrument to which the Seller is a party or by which it shall be bound; nor result in the creation or imposition of any lien upon any of its properties pursuant to the terms of any such indenture, agreement or other instrument (other than the Basic Documents); nor violate any law or, to the best of the Seller's knowledge, any order, rule or regulation applicable to the Seller of any court or of any federal or state regulatory body, administrative agency or other governmental instrumentality having jurisdiction over the Seller or its properties; which breach, default, conflict, lien or violation would have a material adverse effect on the earnings, business affairs or business prospects of the Seller. (vi) NO PROCEEDINGS. There is no action, suit or proceeding before or by any court or governmental agency or body, domestic or foreign, now pending, or to the Seller's knowledge, threatened, against or affecting the Seller: (i) asserting the invalidity of this Agreement, (ii) seeking to prevent the consummation of any of the transactions contemplated by this Agreement or (iii) seeking any determination or ruling that might materially and adversely effect the performance by the Seller of its obligations under, or the validity or enforceability of, this Agreement. (b) The Purchaser hereby represents and warrants to the Seller as of the date of this Agreement and the Closing Date that: (i) ORGANIZATION AND GOOD STANDING. The Purchaser shall have been duly organized and shall be validly existing as a limited liability company in good standing under the laws of the State of Delaware, and has power and authority to own its properties and to conduct its business as such properties shall be currently owned and such business is presently conducted, and had at all relevant times, and shall now have, power, authority and legal right to acquire and own the Receivables. 6 (ii) DUE QUALIFICATION. The Purchaser shall be duly qualified to do business as a foreign limited liability company in good standing, and shall have obtained all necessary licenses and approvals in all jurisdictions in which the ownership or lease of property or the conduct of its business shall require such qualifications and where the failure to so qualify will have a material adverse effect on the ability of the Purchaser to conduct its business or perform its obligations under this Agreement. (iii) POWER AND AUTHORITY. The Purchaser shall have the power and authority to execute and deliver this Agreement and to carry out its terms; the Purchaser shall have full power and authority to purchase the property to be purchased and shall have duly authorized such purchase; and the execution, delivery and performance of this Agreement shall have been duly authorized by the Purchaser by all necessary action. (iv) BINDING OBLIGATION. This Agreement shall constitute a legal, valid and binding obligation of the Purchaser enforceable in accordance with its terms, except as enforceability may be limited by bankruptcy, insolvency, reorganization, moratorium and other similar laws affecting creditors' rights generally or by general principles of equity. (v) NO VIOLATION. The consummation of the transactions contemplated by this Agreement and the fulfillment of the terms hereof shall not conflict with, result in any breach of any of the terms and provisions of, nor constitute (with or without notice or lapse of time) a default under, the certificate of formation or limited liability company agreement of the Purchaser, or conflict with or breach any of the material terms or provisions of, or constitute (with or without notice or lapse of time) a default under, any indenture, agreement or other instrument to which the Purchaser is a party or by which it shall be bound; nor result in the creation or imposition of any Lien upon any of its properties pursuant to the terms of any such indenture, agreement or other instrument (other than the Basic Documents), nor violate any law or, to the best of the Purchaser's knowledge, any order, rule or regulation applicable to the Purchaser of any court or of any federal or state regulatory body, administrative agency or other governmental instrumentality having jurisdiction over the Purchaser or its properties; which breach, default, conflict, Lien or violation would have a material adverse affect on the earnings, business affairs or business prospects of the Purchaser. (vi) NO PROCEEDINGS. There is no action, suit or proceeding before or by any court or governmental agency or body, domestic or foreign, now pending, or to the Purchaser's knowledge, threatened, against or affecting the Purchaser: (i) asserting the invalidity of this Agreement, (ii) seeking to prevent the consummation of any of the transactions contemplated by this Agreement or (iii) seeking any determination or ruling that might materially and adversely affect the performance by the Purchaser of its obligations under, or the validity or enforceability of, this Agreement. 7 (c) The representations and warranties set forth in this Section shall survive the sale of the Receivables by the Seller to the Purchaser pursuant to this Agreement and the sale of the Receivables by the Purchaser to the Issuer pursuant to the Sale and Servicing Agreement. Upon discovery by the Seller, the Purchaser or the Owner Trustee of a breach of any of the foregoing representations and warranties, the party discovering such breach shall give prompt written notice to the others. SECTION 2.03 REPRESENTATIONS AND WARRANTIES OF THE SELLER AS TO THE RECEIVABLES. (a) ELIGIBILITY OF RECEIVABLES. The Seller hereby represents and warrants as of the Cutoff Date that: (i) CHARACTERISTICS OF RECEIVABLES. Each Receivable (A) shall have been originated in the United States by a Dealer for the retail sale of the related Financed Vehicle in the ordinary course of such Dealer's business, shall have been fully and properly executed by the parties thereto, shall have been purchased by the Seller from such Dealer under an existing agreement with the Seller and shall have been validly assigned by such Dealer to the Seller in accordance with the terms of such agreement, (B) shall have created or shall create a valid, subsisting and enforceable first priority security interest in favor of the Seller in the related Financed Vehicle, which security interest shall be assignable and has been assigned by the Seller to the Purchaser, (C) shall provide for monthly payments that fully amortize the Amount Financed by maturity (except for minimally different payments in the first or last month in the life of the Receivable) and provide for a finance charge or yield interest at its APR, in either case calculated based on the Rule of 78s, the simple interest method or the actuarial method, (D) shall contain customary and enforceable provisions such that the rights and remedies of the holder thereof shall be adequate for realization against the collateral of the benefits of the security and (E) shall provide for, in the event that such Receivable is prepaid, a prepayment that fully pays the Principal Balance and includes accrued but unpaid interest. (ii) SCHEDULE OF RECEIVABLES. The information set forth in the Schedule of Receivables shall be true and correct in all material respects as of the opening of business on the Cutoff Date, the Receivables were selected at random from the retail installment sale contracts included in the portfolio of the Seller meeting the selection criteria set forth in this Section and no selection procedures believed to be adverse to the interests of any Securityholders shall have been utilized in selecting the Receivables. (iii) COMPLIANCE WITH LAW. To the knowledge of the Seller, each Receivable and each sale of the related Financed Vehicle shall have complied at the time it was originated or made, and shall comply at the time of execution of this Agreement in all material respects with all requirements of applicable federal, state and local laws, and regulations thereunder, including usury laws, the Federal Truth-in-Lending Act, the Equal Credit Opportunity Act, the Fair Credit Billing Act, the Fair Credit Reporting Act, the Fair Debt Collection Practices Act, the Federal Trade Commission Act, the Magnuson-Moss Warranty Act, Federal Reserve Board Regulations B, M and Z, to the 8 extent applicable, state adaptations of the National Consumer Act and of the Uniform Consumer Credit Code and other consumer credit, equal credit opportunity and disclosure laws, except with respect to applicable Florida documentary stamp taxes as to which the effect of noncompliance will not have a material adverse effect on such Receivable. (iv) BINDING OBLIGATION. Each Receivable shall constitute the legal, valid and binding payment obligation in writing of the related Obligor, enforceable by the holder thereof in accordance with its terms, except as enforceability may be limited by bankruptcy, insolvency, reorganization, moratorium and other similar laws affecting the enforcement of creditors' rights in general and by general principles of equity, regardless of whether such enforceability shall be considered in a proceeding in equity or at law. (v) NO BANKRUPT OBLIGORS. None of the Receivables shall be due, to the best knowledge of the Seller, from any Obligor who is presently the subject of a bankruptcy proceeding or is insolvent. (vi) NO GOVERNMENT OBLIGORS. None of the Receivables shall be due from the United States or any state, or from any agency, department or instrumentality of the United States or any state or local government. (vii) EMPLOYEE OBLIGORS. None of the Receivables shall be due from any employee of the Seller, the Purchaser or any of their respective affiliates. (viii) SECURITY INTEREST IN FINANCED VEHICLES. Immediately prior to the sale, assignment and transfer thereof pursuant hereto, each Receivable shall be secured by a validly perfected first priority security interest in the related Financed Vehicle in favor of the Seller as secured party or all necessary and appropriate action with respect to such Receivable shall have been taken to perfect a first priority security interest in such Financed Vehicle in favor of the Seller as secured party. (ix) RECEIVABLES IN FORCE. No Receivable shall have been satisfied, subordinated or rescinded, nor shall any Financed Vehicle have been released in whole or in part from the lien granted by the related Receivable. (x) NO WAIVERS. No provision of a Receivable shall have been waived in such a manner that such Receivable fails to meet all of the other representations and warranties made by the Seller herein with respect thereto. (xi) NO AMENDMENTS. No Receivable shall have been amended or modified in such a manner that the total number of Scheduled Payments has been increased or that the related Amount Financed has been increased or that such Receivable fails to meet all of the other representations and warranties made by the Seller herein with respect thereto. (xii) NO DEFENSES. No facts shall be known to the Seller which would give rise to any right of rescission, setoff, counterclaim or defense, nor shall the same have been asserted or threatened, with respect to any Receivable. 9 (xiii) NO LIENS. To the knowledge of the Seller, no liens or claims shall have been filed as of the date of this Agreement, including liens for work, labor or materials relating to a Financed Vehicle, that shall be liens prior to, or equal or coordinate with, the security interest in such Financed Vehicle granted by the related Receivable, which Liens shall not have been released or satisfied as of the Closing Date. (xiv) NO DEFAULTS; NO REPOSSESSION. Except for payment defaults that, as of the Cutoff Date, have been continuing for a period of not more than 30 days, no default, breach, violation or event permitting acceleration under the terms of any Receivable shall have occurred as of the Cutoff Date; no continuing condition that with notice or the lapse of time would constitute a default, breach, violation or event permitting acceleration under the terms of any Receivable shall have arisen; the Seller shall not have waived any of the foregoing; and no Financed Vehicle has been repossessed without reinstatement as of the Cutoff Date. (xv) INSURANCE. The terms of each Receivable require the Obligor to obtain and maintain physical damage insurance covering the related Financed Vehicle in accordance with the Seller's normal requirements. The terms of each Receivable allow, but do not require the Seller to (and the Seller, in accordance with its current normal servicing procedures, does not) obtain any such coverage on behalf of the Obligor. (xvi) GOOD TITLE. It is the intention of the Seller that the transfer and assignment herein contemplated, taken as a whole, constitute a sale of the Receivables from the Seller to the Purchaser and that the beneficial interest in and title to the Receivables not be part of the debtor's estate in the event of the filing of a bankruptcy petition by or against the Seller under any bankruptcy law. No Receivable has been sold, transferred, assigned or pledged by the Seller to any Person other than the Purchaser, and no provision of a Receivable shall have been waived, as provided in clause (x) above; immediately prior to the transfer and assignment herein contemplated, the Seller had good and marketable title to each Receivable free and clear of all Liens and rights of others; immediately upon the transfer and assignment thereof, the Purchaser shall have good and marketable title to each Receivable, free and clear of all Liens and rights of others; and the transfer and assignment herein contemplated has been perfected under the UCC. (xvii) LAWFUL ASSIGNMENT. No Receivable shall have been originated in, or shall be subject to the laws of, any jurisdiction under which the sale, transfer and assignment of such Receivable under this Agreement or pursuant to transfers of the related certificates of title shall be unlawful, void or voidable. (xviii) ALL FILINGS MADE. As of the Closing Date, all filings (including UCC filings) necessary in any jurisdiction to provide third parties with notice of the transfer and assignment herein contemplated, to perfect the sale of the receivables from the Seller to the Purchaser and to give the Purchaser a first priority perfected security interest in the Receivables shall have been made. 10 (xix) ONE ORIGINAL. There shall be only one original executed copy of each Receivable. (xx) CHATTEL PAPER. Each Receivable constitutes "chattel paper" as defined in the UCC. (xxi) ADDITIONAL REPRESENTATIONS AND WARRANTIES. (A) Each Receivable shall have an original number of Scheduled Payments of not less than 12 nor more than 72 and, as of the Cutoff Date, a remaining number of Scheduled Payments of not less than 5 nor more than 72; (ii) each Receivable provides for the payment of a finance charge based on an APR ranging from 6% to 15%; (iii) each Receivable shall have had an original principal balance of not less than $811 and not more than $80,617 and, as of the Cutoff Date, an unpaid principal balance of not less than $401 nor more than $49,988; (iv) no Receivable was originated under a special financing program; (v) no Receivable shall have a Scheduled Payment that is more than 30 days past due as of the Cutoff Date; (vi) no Financed Vehicle was subject to force-placed insurance as of the Cutoff Date; (vii) there is no Receivable as to which payments ahead of more than 6 Scheduled Payments have been received from or on behalf of the related Obligor; and (viii) each Receivable is being serviced by Toyota Motor Credit Corporation. (b) NOTICE OF BREACH. The representations and warranties set forth in this Section shall speak as of the execution and delivery of this Agreement, but shall survive the sale, transfer and assignment of the Receivables to the Purchaser and any subsequent assignment or transfer pursuant to Article Two of the Sale and Servicing Agreement. The Purchaser, the Seller or the Owner Trustee, as the case may be, shall inform the other parties promptly, in writing, upon discovery of any breach of the Seller's representations and warranties pursuant to this Section which materially and adversely affects the interests of the Purchaser (or any assignee thereof) in any Receivable. (c) REPURCHASE OF RECEIVABLES. In the event of a breach of any representation or warranty set forth in Section 2.03(a) which materially and adversely affects the interest of the Purchaser (or any assignee thereof) in any Receivable, unless such breach shall have been cured in all material respects, the Seller shall repurchase such Receivable by the last day of the second Collection Period following the Collection Period in which the discovery of the breach is made or notice is received, as the case may be (or, at the option of the Seller, the last day in the first Collection Period following the Collection Period in which such discovery is made or such notice received). This repurchase obligation shall obtain for all representations and warranties of the Seller contained in Section 2.03(a) of this Agreement whether or not the Seller has knowledge of the breach at the time of the breach or at the time the representations and warranties were made. In consideration of the purchase of any such Receivable, the Seller shall remit an amount equal to the Warranty Purchase Payment in respect of such Receivable to the Purchaser, and the Seller shall be entitled to receive the Released Warranty Amount from (or on behalf of) the Purchaser. The sole remedy of the Purchaser (or any assignee thereof) with respect to a breach of the Seller's representations and warranties pursuant to this Agreement shall be to require the Seller to repurchase the related Receivable pursuant to this Section. Upon any such repurchase, the Purchaser shall, without further action, be deemed to transfer, assign, 11 set-over and otherwise convey to the Seller, without recourse, representation or warranty, all the right, title and interest of the Purchaser in, to and under such repurchased Receivable, all monies due or to become due with respect thereto and all proceeds thereof. The Purchaser or the Owner Trustee, as applicable, shall execute such documents and instruments of transfer or assignment and take such other actions as shall reasonably be requested by the Seller to effect the conveyance of such Receivable pursuant to this Section. SECTION 2.04 COVENANTS OF THE SELLER. The Seller hereby covenants that: (a) SECURITY INTERESTS. Except for the conveyances hereunder, the Seller will not sell, pledge, assign or transfer to any other Person, or grant, create, incur, assume or suffer to exist any Lien on any Receivable, whether now existing or hereafter created, or any interest therein, the Seller will immediately notify the Purchaser of the existence of any Lien on any Receivable and, in the event that the interests of the Purchaser (or any assignee thereof) in such Receivable are materially and adversely affected, such Receivable shall be repurchased from the Purchaser by the Seller in the manner and with the effect specified in Section 2.03(c), and the Seller shall defend the right, title and interest of the Purchaser in, to and under the Receivables, whether now existing or hereafter created, against all claims of third parties claiming through or under the Seller; provided, however, that nothing in this subsection shall prevent or be deemed to prohibit the Seller from suffering to exist upon any of the Receivables, Liens for municipal or other local taxes if such taxes shall not at the time be due and payable or if the Seller shall currently be contesting the validity of such taxes in good faith by appropriate proceedings and shall have set aside on its books adequate reserves with respect thereto. (b) DELIVERY OF PAYMENTS. The Seller agrees to deliver in kind upon receipt to the Servicer under the Sale and Servicing Agreement (if other than the Seller) all payments received by the Seller in respect of the Receivables as soon as practicable after receipt thereof by the Seller from and after the appointment of the Servicer as Servicer under the Sale and Servicing Agreement with respect to the Toyota Auto Receivables 2001-B Owner Trust. (c) CONVEYANCE OF RECEIVABLES. The Seller covenants and agrees that it will not convey, assign, exchange or otherwise transfer the Receivables to any Person prior to the termination of this Agreement pursuant to Article IV hereof. (d) NO IMPAIRMENT. The Seller shall take no action, nor omit to take any action, which would impair the rights of the Purchaser in any Receivable, nor shall it, except as expressly provided in this Agreement or the Sale and Servicing Agreement, reschedule, revise or defer payments due on any Receivable. (e) DELIVERY OF OPINION OF COUNSEL. On the Closing Date, the Seller will obtain and deliver to the Purchaser an Opinion of Counsel to the effect that all of the Receivables originated in the State of California are enforceable under California law and applicable federal laws, subject to customary exceptions. 12 ARTICLE III. PAYMENT OF RECEIVABLES PURCHASE PRICE SECTION 3.01 PAYMENT OF RECEIVABLES PURCHASE PRICE. In consideration of the sale of the Receivables from the Seller to the Purchaser as provided in Section 2.01, on the Closing Date the Purchaser agrees to pay the Seller an amount equal to the Receivables Purchase Price. The Receivables Purchase Price shall be paid in the form of (i) $1,446,653,042.44, the net cash proceeds from the sale by the Purchaser of the Class A-2 Notes, the Class A-3 Notes and the Class A-4 Notes and the net cash proceeds of the sale of the Class A-1 Notes to TMCC (less amounts retained to pay expenses of the Purchaser and to fund the Reserve Account Initial Deposit), and (ii) $98,751,706.75 evidenced by an advance under a subordinated non-recourse promissory note. ARTICLE IV. TERMINATION SECTION 4.01 TERMINATION. The respective obligations and responsibilities of the Seller and the Purchaser created hereby shall terminate, except for the indemnity obligations of the Seller as provided herein, upon the termination of the Trust Agreement and dissolution of the Issuer as provided in Article IX of the Trust Agreement. ARTICLE V. MISCELLANEOUS PROVISIONS SECTION 5.01 AMENDMENT. (a) This Agreement may be amended from time to time by the Purchaser and the Seller to cure any ambiguity, to correct or supplement any provision herein which may be inconsistent with any other provision herein, or to add any other provision with respect to matters or questions arising under this Agreement which shall not be inconsistent with the provisions of this Agreement or the Trust Agreement and Sale and Servicing Agreement; provided, however, that such action shall not, as evidenced by an Opinion of Counsel to the Purchaser delivered to the Owner Trustee, adversely affect in any material respect the interests of the Issuer as assignee of the Purchaser's rights and interests hereunder. (b) This Agreement may also be amended from time to time by the Purchaser and the Seller with the consent of the Owner Trustee for the purpose of adding any provisions to or changing in any manner or eliminating any of the provisions of this Agreement. SECTION 5.02 PROTECTION OF RIGHT, TITLE AND INTEREST TO RECEIVABLES. (a) The Seller at its expense shall cause this Agreement, all amendments hereto and/or all financing statements and continuation statements and any other necessary documents covering the Purchaser's right, title and interest to the Receivables and other property 13 conveyed by the Seller to the Purchaser hereunder to be promptly recorded, registered and filed, and at all times to be kept recorded, registered and filed, all in such manner and in such places as may be required by law fully to preserve and protect the right, title and interest of the Purchaser hereunder to all of the Receivables and such other property. The Seller shall deliver to the Purchaser file-stamped copies of, or filing receipts for, any document recorded, registered or filed as provided above, as soon as available following such recording, registration or filing. The Purchaser and the Owner Trustee shall cooperate fully with the Seller in connection with the obligations set forth above and will execute any and all documents reasonably required to fulfill the intent of this subsection. (b) Within 30 days after the Seller makes any change in its name, identity or corporate structure which would make any financing statement or continuation statement filed in accordance with paragraph (a) above seriously misleading within the meaning of Section 9402(7) of the UCC as in effect in the applicable state, the Seller shall give the Purchaser notice of any such change and shall execute and file such financing statements or amendments as may be necessary to continue the perfection of the Purchaser's security interest in the Receivables and the proceeds thereof. (c) The Seller will give the Purchaser prompt written notice of any relocation of any office from which the Seller keeps records concerning the Receivables or of its principal executive office and whether, as a result of such relocation, the applicable provisions of the UCC would require the filing of any amendment of any previously filed financing or continuation statement or of any new financing statement and shall execute and file such financing statements or amendments as may be necessary to continue the perfection of the interest of the Purchaser in the Receivables and the proceeds thereof. SECTION 5.03 GOVERNING LAW. This Agreement shall be construed in accordance with the laws of the State of New York and the obligations, rights and remedies of the parties hereunder shall be determined in accordance with such laws. SECTION 5.04 NOTICES. All demands, notices and communications hereunder shall be in writing and shall be deemed to have been duly given if personally delivered at or mailed by registered mail, return receipt requested, to (a) in the case of the Purchaser, to Toyota Auto Finance Receivables LLC, 19300 Gramercy Place, Torrance, California 90509, Attention: President; (b) in the case of Toyota Motor Credit Corporation, 19001 South Western Avenue, Torrance, California 90501, Attention: Treasury Department, Vice President, Treasury; and (c) in the case of the Owner Trustee, to First Union Trust Company, National Association, One Rodney Square, 920 King Street, Suite 102, Wilmington, Delaware 19801; (d) in the case of the Indenture Trustee, to Wells Fargo Bank Minnesota, National Association, Sixth and Marquette Avenue, MAC: N9311-161, Minneapolis, Minnesota, 55479; or, as to any of such Persons, at such other address as shall be designated by such Person in a written notice to the other Persons. SECTION 5.05 SEVERABILITY OF PROVISIONS. If any one or more of the covenants, agreements, provisions or terms of this Agreement shall for any reason whatsoever be held invalid, then such covenants, agreements, provisions or terms shall be deemed severable from the 14 remaining covenants, agreements, provisions and terms of this Agreement and shall in no way affect the validity or enforceability of the other provisions of this Agreement. SECTION 5.06 ASSIGNMENT. This Agreement may not be assigned by the Purchaser or the Seller except as contemplated by this Section, Section 5.14 of this Agreement, the Trust Agreement and the Sale and Servicing Agreement; provided, however, that simultaneously with the execution and delivery of this Agreement, the Purchaser shall assign all of its right, title and interest herein to the Owner Trustee for the benefit of any Securityholders as provided in Section 2.01 of the Sale and Servicing Agreement, to which the Seller hereby expressly consents. The Seller also acknowledges that the Issuer will further assign the rights and interests of the Purchaser hereunder to the Indenture Trustee for the benefit of the Noteholders pursuant to the Indenture. The Seller agrees to perform its obligations hereunder for the benefit of the Issuer, and agrees that the Owner Trustee or the Indenture trustee, as applicable, may enforce the provisions of this Agreement, exercise the rights of the Purchaser and enforce the obligations of the Seller hereunder without the consent of the Purchaser. SECTION 5.07 FURTHER ASSURANCES. The Seller and the Purchaser agree to do and perform, from time to time, any and all acts and to execute any and all further instruments required or reasonably requested by the other party hereto or by the Owner Trustee more fully to effect the purposes of this Agreement, including, without limitation, the execution of any financing statements, amendments, continuation statements or releases relating to the Receivables for filing under the provisions of the UCC or other law of any applicable jurisdiction. SECTION 5.08 NO WAIVER; CUMULATIVE REMEDIES. No failure to exercise and no delay in exercising, on the part of the Purchaser, the Owner Trustee, the Indenture Trustee or the Seller, of any right, remedy, power or privilege hereunder shall operate as a waiver thereof; nor shall any single or partial exercise of any right, remedy, power or privilege hereunder preclude any other or further exercise thereof or the exercise of any other right, remedy, power or privilege. The rights, remedies, powers and privileges herein provided are cumulative and not exhaustive of any rights, remedies, powers and privileges provided by law. SECTION 5.09 COUNTERPARTS. This Agreement may be executed in two or more counterparts (and by different parties on separate counterparts), each of which shall be an original, but all of which together shall constitute one and the same instrument. SECTION 5.10 THIRD-PARTY BENEFICIARIES. This Agreement will inure to the benefit of and be binding upon the parties signatory hereto, and the Owner Trustee for the benefit of any Securityholders, which shall be considered to be a third-party beneficiary hereof. Except as otherwise provided in this Agreement, no other Person will have any right or obligation hereunder. SECTION 5.11 MERGER AND INTEGRATION. Except as specifically stated otherwise herein, this Agreement sets forth the entire understanding of the parties relating to the subject matter hereof, and all prior understandings, written or oral, are superseded by this Agreement. This Agreement may not be modified, amended, waived or supplemented except as provided herein. 15 SECTION 5.12 HEADINGS. The headings herein are for purposes of reference only and shall not otherwise affect the meaning or interpretation of any provision hereof. SECTION 5.13 INDEMNIFICATION. The Seller shall indemnify and hold harmless the Purchaser, the Issuer, the Owner Trustee and the Securityholders from and against any and all costs, expenses, losses, claims, damages, injury and liabilities to the extent that such cost, expense, loss, claim, damage or liability arose out of, and was imposed upon such Person through the willful misconduct or negligence of the Seller in the performance of its duties under this Agreement or by reason of reckless disregard of its obligations and duties under this Agreement, including, but not limited to, any judgment, award, settlement, reasonable attorneys' fees and other costs or expenses incurred in connection with the defense of any actual or threatened action, proceeding or claim; provided, however, that the Seller shall not indemnify any such Person if such acts, omissions or alleged acts or omissions constitute negligence or willful misconduct by the Purchaser, the Owner Trustee or any Securityholders. In case any such action is brought against a party indemnified under this Section 5.13 and it notifies the Seller of the commencement thereof, the Seller will assume the defense thereof, with counsel reasonably satisfactory to such indemnified party (who may, unless there is, as evidenced by an Opinion of Counsel stating that there is an unwaivable conflict of interest, be counsel to the Seller), and the Seller will not be liable to such indemnified party under this Section for any legal or other expenses subsequently incurred by such indemnified party in connection with the defense thereof, other than reasonable costs of investigation. SECTION 5.14 MERGER OR CONSOLIDATION OF, OR ASSUMPTION OF THE OBLIGATIONS OF, THE SELLER. (a) The Seller shall not consolidate with or merge into any other corporation or convey or transfer its properties and assets substantially as an entirety to any Person, unless: (i) the corporation formed by such consolidation or into which the Seller is merged or the Person which acquires by conveyance or transfer the properties and assets of the Seller substantially as an entirety shall be organized and existing under the laws of the United States or any State or the District of Columbia, and, if the Seller is not the surviving entity, shall expressly assume, by an agreement supplemental hereto, executed and delivered to the Purchaser and the Owner Trustee, in form reasonably satisfactory to the Purchaser and the Owner Trustee, the performance of every covenant and obligation of the Seller hereunder and shall benefit from all the rights granted to the Seller hereunder in all material respects; and (ii) The Seller shall have delivered to the Purchaser and the Owner Trustee an Officer's Certificate of the Seller and an Opinion of Counsel each stating that such consolidation, merger, conveyance or transfer and such supplemental agreement comply with this Section and that all conditions precedent herein provided for relating to such transaction have been complied with. 16 (b) The obligations of the Seller hereunder shall not be assignable nor shall any Person succeed to the obligations of the Seller hereunder except in each case in accordance with the provisions of the foregoing paragraph and of Section 5.06. [REMAINDER OF THE PAGE INTENTIONALLY LEFT BLANK] 17 IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed by their respective officers as of the day and year first above written. TOYOTA MOTOR CREDIT CORPORATION, as Seller By: /s/ George E. Borst ------------------------------------------------ Name: George E. Borst Title: President and Chief Executive Officer TOYOTA AUTO FINANCE RECEIVABLES LLC, as Purchaser By: /s/ Lloyd Mistele ------------------------------------------------ Name: Lloyd Mistele Title: President ACCEPTED: FIRST UNION TRUST COMPANY, NATIONAL ASSOCIATION, not in its individual capacity but solely as Owner Trustee By: /s/ Sterling C. Correia --------------------------------------------------------- Name: Sterling C. Correia Title: Vice President WELLS FARGO BANK MINNESOTA, NATIONAL ASSOCIATION not in its individual capacity but solely as Indenture Trustee By: /s/ Marianna Stershic ------------------------------------------------ Name: Marianna Stershic Title: Vice President S-1 SCHEDULE A SCHEDULE OF RECEIVABLES Omitted -- originals on file at the offices of the Seller, the Purchaser and the Owner Trustee A-1 EX-4.4 5 a2049889zex-4_4.txt EXHIBIT 4.4 EXHIBIT 4.4 TOYOTA AUTO RECEIVABLES 2001-B OWNER TRUST (a Delaware Business Trust) -------------------------------------- AMENDED AND RESTATED TRUST AGREEMENT between TOYOTA AUTO FINANCE RECEIVABLES LLC, as Depositor, and FIRST UNION TRUST COMPANY, NATIONAL ASSOCIATION, as Owner Trustee ---------------------------------------------- Dated as of April 1, 2001 TABLE OF CONTENTS
PAGE ---- ARTICLE I DEFINITIONS Section 1.01 Definitions.................................................................1 Section 1.02 Usage of Terms..............................................................4 ARTICLE II CREATION OF TRUST Section 2.01 Creation of Trust...........................................................4 Section 2.02 Office......................................................................4 Section 2.03 Purposes and Powers.........................................................4 Section 2.04 Power of Attorney...........................................................5 Section 2.05 Declaration of Trust........................................................5 Section 2.06 Liability of the Certificateholder and TMCC.................................6 Section 2.07 Title to Trust Property.....................................................6 Section 2.08 Situs of Trust..............................................................6 Section 2.09 Representations and Warranties of the Depositor.............................6 Section 2.10 Federal Income Tax Allocations..............................................8 ARTICLE III CERTIFICATE Section 3.01 The Certificate.............................................................8 Section 3.02 Authentication of the Certificate...........................................8 Section 3.03 Transfer Restriction........................................................8 Section 3.04 Mutilated, Destroyed, Lost or Stolen Certificate............................9 Section 3.05 Maintenance of Office or Agency.............................................9 Section 3.06 Appointment of Paying Agent.................................................9 ARTICLE IV ACTIONS BY OWNER TRUSTEE OR THE CERTIFICATEHOLDER Section 4.01 Prior Notice to the Certificateholder with Respect to Certain Matters......10 Section 4.02 Action by the Certificateholder with Respect to Certain Matters............10 Section 4.03 Action with Respect to Bankruptcy..........................................11 Section 4.04 Restrictions on the Certificateholder's Power..............................11 -i- PAGE ---- ARTICLE V APPLICATION OF TRUST FUNDS; CERTAIN DUTIES Section 5.01 Establishment of Collection Account and Payahead Account...................11 Section 5.02 Application of Amounts in Trust Accounts...................................12 Section 5.03 Method of Payment..........................................................13 Section 5.04 Accounting and Reports to the Noteholders, the Certificateholder, the Internal Revenue Service and Others........................................13 Section 5.05 Signature on Returns; Tax Matters Partner..................................13 ARTICLE VI AUTHORITY AND DUTIES OF OWNER TRUSTEE Section 6.01 General Authority..........................................................14 Section 6.02 General Duties.............................................................14 Section 6.03 Duties of Owner Trustee....................................................14 Section 6.04 No Duties Except as Specified in this Agreement or in Instructions.........15 Section 6.05 No Action Except Under Specified Documents or Instructions.................16 Section 6.06 Restrictions...............................................................16 ARTICLE VII CONCERNING THE OWNER TRUSTEE Section 7.01 Rights of Owner Trustee....................................................16 Section 7.02 Furnishing of Documents....................................................17 Section 7.03 Representations and Warranties.............................................17 Section 7.04 Reliance; Advice of Counsel................................................18 Section 7.05 Not Acting in Individual Capacity..........................................18 Section 7.06 Owner Trustee Not Liable for the Certificate or Receivables................19 Section 7.07 Owner Trustee May Own the Notes............................................19 Section 7.08 Sales Finance Company Licenses.............................................19 ARTICLE VIII COMPENSATION OF OWNER TRUSTEE Section 8.01 Owner Trustee's Fees and Expenses..........................................20 Section 8.02 Indemnification............................................................20 Section 8.03 Payments to the Owner Trustee..............................................20 -ii- PAGE ---- ARTICLE IX TERMINATION OF TRUST AGREEMENT Section 9.01 Termination of Trust Agreement.............................................21 Section 9.02 Dissolution upon Insolvency of the Depositor...............................22 ARTICLE X SUCCESSOR OWNER TRUSTEES AND ADDITIONAL OWNER TRUSTEES Section 10.01 Eligibility Requirements for Owner Trustee.................................22 Section 10.02 Resignation or Removal of Owner Trustee....................................23 Section 10.03 Successor Owner Trustee....................................................23 Section 10.04 Merger or Consolidation of Owner Trustee...................................24 Section 10.05 Appointment of Co-Trustee or Separate Trustee..............................24 Section 10.06 Power of Attorney for Co-Trustee or Separate Trustee.......................25 ARTICLE XI MISCELLANEOUS Section 11.01 Supplements and Amendments.................................................25 Section 11.02 No Legal Title to Owner Trust Estate in the Certificateholder..............27 Section 11.03 Limitations on Rights of Others............................................27 Section 11.04 Notices....................................................................27 Section 11.05 Severability...............................................................27 Section 11.06 Counterparts...............................................................28 Section 11.07 Successors and Assigns.....................................................28 Section 11.08 No Petition................................................................28 Section 11.09 No Recourse................................................................28 Section 11.10 Headings...................................................................28 Section 11.11 GOVERNING LAW..............................................................28 Section 11.12 TMCC Payment Obligation....................................................28
-iii- EXHIBITS EXHIBIT A FORM OF CERTIFICATE.......................................A-1
-iv- AMENDED AND RESTATED TRUST AGREEMENT dated as of April 1, 2001, by and between TOYOTA AUTO FINANCE RECEIVABLES LLC, a Delaware limited liability company, as depositor, and FIRST UNION TRUST COMPANY, NATIONAL ASSOCIATION, a national banking association, not in its individual capacity but solely as Owner Trustee, amending and restating in its entirety the Trust Agreement dated as of March 23, 2001, by and between TOYOTA AUTO FINANCE RECEIVABLES LLC, a Delaware limited liability company, as depositor, FIRST UNION TRUST COMPANY, NATIONAL ASSOCIATION, a national banking association, not in its individual capacity but solely as Owner Trustee, and herein referred to as the "Trust Agreement" or this "Agreement." IN CONSIDERATION of the mutual agreements herein contained, and of other good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, the parties agree as follows: ARTICLE I DEFINITIONS SECTION 1.01 DEFINITIONS. Except as otherwise specified herein or if the context may otherwise require, capitalized terms used but not otherwise defined herein have the meanings ascribed thereto in the Sale and Servicing Agreement and the Indenture for all purposes of this Trust Agreement. Except as otherwise provided in this Agreement, whenever used herein the following words and phrases, unless the context otherwise requires, shall have the following meanings: "ADMINISTRATION AGREEMENT" means the Administration Agreement dated as of April 1, 2001, by and between the Trust as issuer, TMCC as Administrator, the Indenture Trustee and the Owner Trustee pursuant to which TMCC undertakes to perform certain of the duties and obligations of the Trust and the Owner Trustee hereunder, under the Sale and Servicing Agreement and under the Indenture. "ADMINISTRATOR" means TMCC acting in its capacity as Administrator under the Administration Agreement. "AGREEMENT" means this Amended and Restated Trust Agreement, as the same may be amended and supplemented from time to time. "ASSIGNMENT AGREEMENT" means the Assignment of Swap Agreement dated as of May 15, 2001, by and among the Trust, the Indenture Trustee and the Swap Counterparty. "BASIC DOCUMENTS" means the Receivables Purchase Agreement, this Agreement, the Certificate of Trust, the Sale and Servicing Agreement, the Indenture, the Administration Agreement and the Securities Account Control Agreement and the other documents and certificates delivered in connection herewith and therewith. "BUSINESS TRUST STATUTE" means Chapter 38 of Title 12 of the Delaware Code, 12 Del. Code Section 3801 ET SEQ., as the same may be amended from time to time. "CERTIFICATE" means a certificate evidencing the Subordinated Seller's Interest, substantially in the form attached hereto as Exhibit A. "CERTIFICATE OF TRUST" means the Certificate of Trust filed with respect to the formation of the Trust pursuant to Section 3810(a) of the Business Trust Statute. "CERTIFICATEHOLDER" or "HOLDER" means TAFR LLC, as holder of the Subordinated Seller's Interest. "CODE" means the Internal Revenue Code of 1986, as amended, and the Treasury Regulations promulgated thereunder. "CORPORATE TRUST OFFICE" means, with respect to the Owner Trustee, the principal corporate trust office of the Owner Trustee located at One Rodney Square, 920 King Street, Suite 102, Wilmington, Delaware, 19801; or at such other address as the Owner Trustee may designate by notice to the Certificateholder, or the principal corporate trust office of any successor Owner Trustee (the address of which the successor Owner Trustee will notify the Certificateholder). "DEPOSITOR" means TAFR LLC in its capacity as depositor hereunder. "EXPENSES" shall have the meaning assigned to such term in Section 8.02. "INDENTURE" means the Indenture dated as of April 1, 2001, entered into between the Trust and Wells Fargo Bank Minnesota, National Association, the Indenture Trustee named therein, pursuant to which a series of Notes are issued. "INTEREST RATE SWAP AGREEMENT" means 1992 ISDA Master Agreement dated as of May 15, 2001 (the "1992 ISDA Master Agreement"), including all schedules and confirmations thereto, between the Issuer and the Swap Counterparty, as the same may be amended, supplemented, renewed, extended or replaced from time to time. "NON-U.S. PERSON" means any Person who is not (i) a citizen or resident of the United States who is a natural person, (ii) a corporation or partnership (or an entity treated as a corporation or partnership) organized in or under the laws of the United States or any state thereof, including the District of Columbia (unless, in the case of a partnership, Treasury Regulations are adopted that provide otherwise), (iii) an estate, the income of which is subject to United States Federal income taxation, regardless of its source or (iv) a trust, if a court within the United States is able to exercise primary supervision over the administration of the trust and one or more United States persons (as such term is defined in the Code and Treasury Regulations) have the authority to control all substantial decisions of the trust; except that, to the extent provided in Treasury Regulations, certain trusts in existence prior to August 20, 1996 which elected to be treated as United States Persons prior to such date also shall be U.S. Persons. "NOTES" means the notes issued by the Trust pursuant to the Indenture, having the payment and other terms set forth in such Indenture. "OWNER TRUST ESTATE" means all right, title and interest of the Trust in and to the property and rights assigned to the Trust pursuant to Article II of the Sale and Servicing Agreement, all 2 funds on deposit from time to time in the accounts created pursuant to Section 5.01 of the Sale and Servicing Agreement (excluding any net investment income with respect to amounts held in such accounts) and all other property of the Trust from time to time, including any rights of the Owner Trustee and the Trust pursuant to the Sale and Servicing Agreement and the Administration Agreement, and as assignee of the rights and Interests of the Depositor under the Receivables Purchase Agreement. "OWNER TRUSTEE" means First Union Trust Company, National Association, a national banking association, not in its individual capacity but solely as Owner Trustee under this Agreement, and any successor Owner Trustee hereunder. "PAYING AGENT" means any paying agent or co-paying agent appointed pursuant to Section 3.06, and upon execution of the Indenture shall be the Indenture Trustee and after termination of the Indenture, the Owner Trustee. "RECEIVABLES PURCHASE AGREEMENT" means that certain Receivables Purchase Agreement, dated as of April 1, 2001, between TMCC, as Seller, and TAFR LLC, as Purchaser of the Receivables. "RECORD DATE" means, with respect to the Notes of any Class and each Payment Date, the calendar day immediately preceding such Payment Date or, if Definitive Notes representing any Class of Notes have been issued, the last day of the month immediately preceding the month in which such Payment Date occurs. Any amount stated "as of a Record Date" or "on a Record Date" shall give effect to (i) all applications of collections, and (ii) all payments and distributions to any party under this Agreement, the Indenture and the Trust Agreement or to the related Obligor, as the case may be, in each case as determined as of the opening of business on the related Record Date. "SALE AND SERVICING AGREEMENT" means the Sale and Servicing Agreement dated as of April 1, 2001, among the Trust, TAFR LLC, as seller, and TMCC, as servicer. "SECRETARY OF STATE" means the Secretary of State of the State of Delaware. "SECURITIES ACCOUNT CONTROL AGREEMENT" shall have the meaning ascribed thereto in the Sale and Servicing Agreement. "SUBORDINATED SELLER'S INTEREST" means a fractional undivided interest in the Trust that includes the right to payment of certain available amounts in excess of those necessary to make payments on the Notes on each Payment Date pursuant to Section 5.02(a) herein. The Subordinated Seller's Interest shall represent the entire beneficial ownership of the Trust. "SWAP COUNTERPARTY" shall mean Toyota Motor Credit Corporation, as swap counterparty under the Interest Rate Swap Agreement, or any successor or replacement swap counterparty from time to time under the Interest Rate Swap Agreement. "TAFR LLC" means Toyota Auto Finance Receivables LLC, a Delaware limited liability company, its successors and assigns. 3 "TMCC" means Toyota Motor Credit Corporation, a California corporation, its successors and assigns. "TREASURY REGULATIONS" means regulations, including proposed or temporary regulations, promulgated under the Code. References herein to specific provisions of proposed or temporary regulations shall include analogous provisions of final Treasury Regulations or other successor Treasury Regulations. "TRUST" means the Toyota Auto Receivables 2001-B Owner Trust, formed as a Delaware business trust pursuant to this Agreement and the filing of the Certificate of Trust. SECTION 1.02.USAGE OF TERMS. With respect to all terms in this Agreement, the singular includes the plural and the plural the singular; words importing any gender include the other genders; references to "writing" include printing, typing, lithography and other means of reproducing words in a visible form; references to agreements and other contractual instruments include all subsequent amendments thereto or changes therein entered into in accordance with their respective terms and not prohibited by this Agreement; references to Persons include their permitted successors and assigns; and the term "including" means "including without limitation." ARTICLE II CREATION OF TRUST SECTION 2.01 CREATION OF TRUST. There is hereby formed in accordance with the provisions of the Delaware Act, a Delaware business trust to be known as the Toyota Auto Receivables 2001-B Owner Trust. The Owner Trustee is hereby authorized and vested with the power and authority to make and execute contracts, instruments, certificates, agreements and other writings on behalf of the Trust as set forth herein and to sue and be sued on behalf of the Trust. The Owner Trustee does hereby accept and agree to hold in trust, for the benefit of the Certificateholder and such other Persons as may become beneficiaries hereunder from time to time, all of the Owner Trust Estate conveyed or to be conveyed to the Trust, and all monies and proceeds that may be received with respect thereto, subject to the terms of this Agreement. SECTION 2.02 OFFICE. The principal place of business of the Trust for purposes of Delaware law shall be in care of the Owner Trustee. The Trust may establish additional offices located at such place or places inside or outside of the State of Delaware as the Owner Trustee may designate from time to time in written notice to the Certificateholder and the Servicer. SECTION 2.03 PURPOSES AND POWERS. (a) The purpose of the Trust is to engage in the following activities: (i) to issue Notes pursuant to the Indenture and the Certificate pursuant to this Agreement; 4 (ii) to acquire the Receivables and related property from the Depositor in exchange for the Notes and the Certificate pursuant to the Sale and Servicing Agreement; (iii) to assign, grant, transfer, pledge, mortgage and convey the Trust Estate pursuant to, and on the terms and conditions set forth in, the Indenture and to hold, manage and distribute to the Certificateholder pursuant to the terms of the Sale and Servicing Agreement any portion of the Trust Estate released from the Lien of, and remitted to the Trust pursuant to, the Indenture as set forth therein and in the Sale and Servicing Agreement; (iv) to enter into and perform its obligations under the Basic Documents, the Interest Rate Swap Agreement and the Assignment Agreement to which it is to be a party; (v) to engage in those activities, including entering into agreements, that are necessary, suitable or convenient to accomplish the foregoing or are incidental thereto or connected therewith; and (vi) subject to compliance with the Basic Documents, to engage in such other activities as may be required in connection with conservation of the Owner Trust Estate and the making of distributions to the Certificateholder and the Noteholders and in respect of amounts to be released to the Depositor, the Servicer, the Administrator and third parties, if any. The Trust is hereby authorized to engage in the foregoing activities. The Trust shall not engage in any activity other than in connection with the foregoing and as required or authorized by the terms of the Basic Documents. SECTION 2.04 POWER OF ATTORNEY. Pursuant to the Administration Agreement, the Owner Trustee has authorized the Administrator to perform certain of its administrative duties hereunder, including duties with respect to the management of the Owner Trust Estate, and in connection therewith hereby grants the Administrator its revocable power of attorney. The Certificateholder by its acceptance of the Certificate shall be deemed to have granted power of attorney to the Administrator for purposes of actions taken or to be taken with respect to the Certificate. SECTION 2.05 DECLARATION OF TRUST. The Owner Trustee hereby declares that it will hold the Owner Trust Estate in trust upon and subject to the conditions set forth herein for the use and benefit of the Certificateholder, subject to the obligations of the Trust under the Basic Documents. It is the intention of the parties hereto that the Trust constitute a business trust under the Business Trust Statute and that this Agreement constitute the governing instrument of such business trust. Effective as of the date hereof, the Owner Trustee shall have all rights, powers and duties set forth herein and in the Business Trust Statute with respect to accomplishing the purposes of the Trust. At the direction of the Depositor, the Owner Trustee shall file or cause to be filed a certificate of trust for the Issuer pursuant to the Delaware Act and such amendments 5 thereto as shall be necessary or appropriate to satisfy the purposes of this agreement and as shall be consistent with the provisions hereof. SECTION 2.06 LIABILITY OF THE CERTIFICATEHOLDER AND TMCC. (a) The Administrator shall be liable directly to and will, in accordance with the Administration Agreement and the following provisions, indemnify and hold harmless the Owner Trustee, any co-trustee and the Indenture Trustee for any loss, liability, claim, action, suit, cost or expense of the Trust (including Expenses, to the extent not paid out of the Owner Trust Estate) to the extent that TMCC would be liable if the Trust were a partnership under the Delaware Revised Uniform Limited Partnership Act in which TMCC were a general partner; PROVIDED, HOWEVER, that the Administrator shall not be liable for any losses incurred by the Certificateholder in the capacity of an investor in the Certificate or a Noteholder in the capacity of an investor in the Notes and will not and shall not be deemed hereby to have indemnified the Owner Trustee, any co-trustee or Indenture Trustee against any loss, liability or expense resulting from such trustee's own willful misfeasance, bad faith or negligence or by reason of a breach of representation or warranty thereof contained herein or in the Indenture, as the case may be. In addition, any third party creditors of the Trust (other than in connection with the obligations described in the provisions in the preceding sentence for which TMCC shall not be liable) shall be deemed to be third party beneficiaries of this paragraph. (b) The Certificateholder shall not have any personal liability for any liability or obligation of the Trust, solely by reason of it being the Certificateholder. SECTION 2.07 TITLE TO TRUST PROPERTY. Legal title to all of the Owner Trust Estate shall be vested at all times in the Trust as a separate legal entity except where applicable law in any jurisdiction requires title to any part of the Owner Trust Estate to be vested in a trustee or trustees, in which case title shall be deemed to be vested in the Owner Trustee, a co-trustee and/or a separate trustee, as the case may be. SECTION 2.08 SITUS OF TRUST. The Trust will be located and administered in Delaware. All bank accounts maintained by the Owner Trustee on behalf of the Trust shall be located in the State of Delaware or the State of New York. The Trust shall not have any employees in any state other than Delaware; PROVIDED, HOWEVER, that nothing herein shall restrict or prohibit the Owner Trustee from having employees within or without the State of Delaware. Payments will be received by the Trust only in Delaware or New York, and payments will be made by the Trust only from Delaware or New York. SECTION 2.09 REPRESENTATIONS AND WARRANTIES OF THE DEPOSITOR. (a) The Depositor hereby represents and warrants to the Owner Trustee that as of the Closing Date: (i) The Depositor is duly organized and validly existing as a limited liability company in good standing under the laws of the State of Delaware, with power and authority to own its properties and to conduct its business as such properties are currently owned and such business is presently conducted, and had 6 at all relevant times and has power, authority and legal right to acquire, own and sell the Receivables. (ii) The Depositor is duly qualified to do business as a foreign limited liability company in good standing, and has obtained all necessary licenses and approvals in all jurisdictions in which the ownership or lease of property or the conduct of its business shall require such qualifications and where the failure to so qualify will have a material adverse effect on the ability of the Depositor to conduct its business or perform its obligations under this Agreement. (iii) The Depositor has the power and authority to execute and deliver this Agreement and to carry out its terms and the execution, delivery and performance of this Agreement has been duly authorized by the Depositor by all necessary action. (iv) This Agreement shall constitute a legal, valid and binding obligation of the Depositor enforceable in accordance with its terms, except as enforceability may be limited by bankruptcy, insolvency, reorganization, moratorium and other similar laws affecting creditors' rights generally or by general principles of equity. (v) The consummation of the transactions contemplated by this Agreement and the fulfillment of the terms hereof do not conflict with, result in any breach of any of the terms and provisions of, or constitute (with or without notice or lapse of time) a default under, the limited liability company agreement of the Depositor or conflict with or breach any of the terms or provisions or constitute (with or without notice or lapse of time) a default under any indenture, agreement or other instrument to which the Depositor is a party or by which it is bound, nor result in the creation or imposition of any Lien upon any of its properties pursuant to the terms of any such indenture, agreement or other instrument (other than pursuant to the Basic Documents); nor violate any law or, to the best of the Depositor's knowledge, any order, rule or regulation applicable to the Depositor of any court or of any federal or state regulatory body, administrative agency or other governmental instrumentality having jurisdiction over the Depositor or its properties which breach, default, conflict, lien or violation would have a material adverse effect on the earnings, business affairs or business prospects of the Depositor. (vi) There is no action, suit or proceeding before or by any court or governmental agency or body, domestic or foreign, now pending, or to the Depositor's knowledge, threatened, against or affecting the Depositor: (i) asserting the invalidity of this Agreement, (ii) seeking to prevent the consummation of any of the transactions contemplated by this Agreement, (iii) seeking any determination or ruling that might materially and adversely affect the performance by the Depositor of its obligations under, or the validity or enforceability of, this Agreement or (iv) relating to the Depositor and which 7 might adversely affect the federal income tax attributes of the Trust or the Certificate or the Notes. SECTION 2.10 FEDERAL INCOME TAX ALLOCATIONS. To the extent required for Federal income tax purposes, net income or net losses of the Trust for any month as determined for Federal income tax purposes (and each item of income, gain, loss and deduction entering into the computation thereof) shall be allocated to the Certificateholder (to the extent not previously allocated pursuant to this clause). The Depositor is authorized to modify the allocations in this paragraph if necessary or appropriate, in its sole discretion for the allocations to fairly reflect the economic income, gain or loss to the Certificateholder, as otherwise required by the Code. ARTICLE III CERTIFICATE SECTION 3.01 THE CERTIFICATE. The Certificate shall be executed on behalf of the Trust by manual or facsimile signature of a Trust Officer of the Owner Trustee and authenticated on behalf of the Owner Trustee by the manual or facsimile signature of a Trust Officer. The Certificate bearing the manual or facsimile signatures of individuals who were, at the time when such signatures shall have been affixed, authorized to sign on behalf of the Trust, shall be a valid and binding obligation of the Trust, notwithstanding that such individuals or any of them shall have ceased to be so authorized prior to the authentication and delivery of the Certificate or did not hold such offices at the date of authentication and delivery of the Certificate. The Certificate may be printed, lithographed, typewritten, mimeographed or otherwise produced, in any authorized denomination in the form of Exhibit A hereto. SECTION 3.02 AUTHENTICATION OF THE CERTIFICATE. Concurrently with the initial sale of the Receivables to the Trust pursuant to the Sale and Servicing Agreement, the Owner Trustee shall cause to be executed, authenticated and delivered on behalf of the Trust to or upon the written order of the Depositor, the Certificate evidencing the Subordinated Seller's Interest. The Certificate shall not entitle its holder to any benefit under this Agreement or be valid for any purpose, unless there shall appear on such Certificate a certificate of authentication substantially in the form set forth in Exhibit A, executed by the Owner Trustee or the Owner Trustee's authenticating agent, by manual or facsimile signature of a Trust Officer, and such authentication shall constitute conclusive evidence, and the only evidence, that such Certificate shall have been duly authenticated and delivered hereunder. The Certificate shall be dated the date of its authentication. SECTION 3.03 TRANSFER RESTRICTION. The Certificate shall not be transferable by the Certificateholder to any other Person unless such transfer is a result of a consolidation or merger of the Certificateholder with such Person. Any other purported transfer of the Certificate or any beneficial interest therein will be deemed to be void and of no effect to the extent permitted by applicable law. SECTION 3.04 MUTILATED, DESTROYED, LOST OR STOLEN CERTIFICATE. If (a) a mutilated Certificate shall be surrendered to the Owner Trustee, or if the Owner Trustee shall receive 8 evidence to its satisfaction of the destruction, loss or theft of the Certificate and (b) there shall be delivered to the Owner Trustee such security or indemnity as may be required by them to save each of them harmless, then in the absence of notice that such Certificate shall have been acquired by a bona fide purchaser, the Owner Trustee on behalf of the Trust shall execute and the Owner Trustee, or the Owner Trustee's authenticating agent, shall authenticate and deliver, in exchange for or in lieu of any such mutilated, destroyed, lost or stolen Certificate, a new Certificate of like tenor and denomination. In connection with the issuance of any new Certificate under this Section, the Owner Trustee may require the payment of a sum sufficient to cover any tax or other governmental charge that may be imposed in connection therewith. Any duplicate Certificate issued pursuant to this Section shall constitute conclusive evidence of ownership in the Trust, as if originally issued, whether or not the lost, stolen or destroyed Certificate shall be found at any time. SECTION 3.05 MAINTENANCE OF OFFICE OR AGENCY. The Owner Trustee shall maintain in Wilmington, Delaware, an office or offices or agency or agencies where notices and demands to or upon the Owner Trustee in respect of the Certificate and the Basic Documents may be served. The Owner Trustee's office located at One Rodney Square, 920 King Street, Suite 102, Wilmington, Delaware, 19801 shall be the principal corporate trust office for such purposes. The Owner Trustee shall give prompt written notice to the Depositor and to the Certificateholder of any change in the location of any such office or agency. SECTION 3.06 APPOINTMENT OF PAYING AGENT. Except during any period when the Indenture Trustee is authorized and directed to do so under the Indenture (i.e. prior to the termination of the Indenture), the Paying Agent shall make distributions to the Certificateholder from the Collection Account pursuant to Section 5.02 and shall report the amounts of such distributions to the Owner Trustee. Any Paying Agent shall have the revocable power to withdraw funds from the Collection Account for the purpose of making the distributions referred to above. The Owner Trustee may revoke such power and remove the Paying Agent if the Owner Trustee determines in its sole discretion that the Paying Agent shall have failed to perform its obligations under this Agreement in any material respect. The Paying Agent upon execution of the Indenture shall be the Indenture Trustee and after termination of the Indenture, the Owner Trustee and any co-paying agent chosen by the Owner Trustee and acceptable to the Owner Trustee. The Owner Trustee shall be permitted to resign as Paying Agent upon 30 days' written notice to the Owner Trustee. In the event that the Owner Trustee shall no longer be the Paying Agent, the Owner Trustee shall appoint a successor to act as Paying Agent (which shall be a bank or trust company). By executing this Agreement, the Owner Trustee hereby agrees in its capacity as Paying Agent to hold all sums, if any, held by it for payment to the Certificateholder in trust for the benefit of the Certificateholder until such sums are paid to the Certificateholder. The Owner Trustee shall cause such successor Paying Agent or any additional Paying Agent appointed by the Owner Trustee to execute and deliver to the Owner Trustee an instrument in which such successor Paying Agent or additional Paying Agent shall agree with the Owner Trustee that as Paying Agent, such successor Paying Agent or additional Paying Agent will hold all sums, if any, held by it for payment to the Certificateholder in trust for the benefit of the Certificateholder until such sums shall be paid to such Certificateholder. The Paying Agent shall return all unclaimed funds to the Owner Trustee and upon removal of a Paying Agent such Paying Agent shall also return all funds in its possession to the Owner Trustee. The provisions of Sections 7.01, 7.03, 7.04, 7.05, 7.06, 8.01 and 8.02 shall apply to the Owner Trustee also in its 9 role as Paying Agent, for so long as the Owner Trustee shall act as Paying Agent and, to the extent applicable, to any other paying agent appointed hereunder. Any reference in this Agreement to the Paying Agent shall include any co-paying agent unless the context requires otherwise. ARTICLE IV ACTIONS BY OWNER TRUSTEE OR THE CERTIFICATEHOLDER SECTION 4.01 PRIOR NOTICE TO THE CERTIFICATEHOLDER WITH RESPECT TO CERTAIN MATTERS. With respect to the following matters, the Owner Trustee shall not take action unless at least 30 days before the taking of such action (or such shorter period as shall be agreed to in writing by the Certificateholder), the Owner Trustee shall have notified the Certificateholder in writing of the proposed action and the Certificateholder shall not have notified the Owner Trustee in writing prior to the 30th day (or such agreed upon shorter period) after such notice is given that the Certificateholder has withheld consent or provided alternative direction: (a) the initiation of any claim or lawsuit by the Trust (except claims or lawsuits brought in connection with the collection of the Receivables) and the compromise of any action, claim or lawsuit brought by or against the Trust (except with respect to the aforementioned claims or lawsuits for collection of the Receivables); (b) the election by the Trust to file an amendment to the Certificate of Trust (unless such amendment is required to be filed under the Business Trust Statute); (c) the amendment of the Indenture, whether or not by a Supplemental Indenture, in circumstances where the consent of any Noteholder is required; (d) the amendment of the Indenture, whether or not by a Supplemental Indenture, in circumstances where the consent of any Noteholder is not required but such amendment materially adversely affects the interest of the Certificateholder; (e) the amendment, change or modification of the Administration Agreement, other than to cure any ambiguity or to amend or supplement any provision in a manner or add any provision that would not materially adversely affect the interests of the Certificateholder; or (f) the appointment (i) pursuant to the Indenture of a successor Note Registrar, Paying Agent or Indenture Trustee and (ii) any consent by the Note Registrar, Paying Agent or Indenture Trustee to the assignment of its respective obligations under the Indenture or this Agreement, as applicable. SECTION 4.02 ACTION BY THE CERTIFICATEHOLDER WITH RESPECT TO CERTAIN MATTERS. The Owner Trustee shall not have the power, except upon the direction of the Certificateholder, to (a) remove the Administrator pursuant to Section 8 of the Administration Agreement, (b) appoint a successor Administrator pursuant to Section 8 of the Administration Agreement, (c) remove the Servicer pursuant to Section 8.01 of the Sale and Servicing Agreement or (d) except as expressly provided in the Basic Documents, sell the Receivables after the termination of the Indenture. 10 The Owner Trustee shall take the actions referred to in the preceding sentence only upon written instructions signed by the authorized representative of the Certificateholder. SECTION 4.03 ACTION WITH RESPECT TO BANKRUPTCY. The Owner Trustee shall not have the power to commence a voluntary proceeding in bankruptcy relating to the Trust without the prior approval of the Certificateholder and the delivery to the Owner Trustee by the Certificateholder certifying that the Certificateholder reasonably believes that the Trust is insolvent. SECTION 4.04 RESTRICTIONS ON THE CERTIFICATEHOLDER'S POWER. The Certificateholder shall not direct the Owner Trustee to take or refrain from taking any action if such action or inaction would be contrary to any obligations of the Trust or of the Owner Trustee under any of the Basic Documents or would be contrary to Section 2.03 nor shall the Owner Trustee be obligated to follow any such direction, if given. ARTICLE V APPLICATION OF TRUST FUNDS; CERTAIN DUTIES SECTION 5.01 ESTABLISHMENT OF COLLECTION ACCOUNT AND PAYAHEAD ACCOUNT. (a) The Owner Trustee, for the benefit of the Certificateholder, shall establish and maintain, or shall cause to be established and maintained, in the name of the Trust (or in such other name as shall be specified in the Sale and Servicing Agreement), the Collection Account and the Payahead Account. Each such account shall be established and maintained as an Eligible Deposit Account, and, subject to provisions of the Sale and Servicing Agreement and the Indenture, bearing a designation clearly indicating that, subject to Section 5.01(b), the funds deposited therein are held by the Trust for the benefit of the Certificateholder, in each case in accordance with Section 5.01 in the Sale and Servicing Agreement. Subject to Section 5.01(b), the Owner Trustee shall possess all right, title and interest in all funds on deposit from time to time in the Collection Account and the Payahead Account and in all proceeds thereof (other than any net investment earnings on Eligible Investments held therein). Except as otherwise expressly provided herein, the Collection Account and the Payahead Account shall be under the sole dominion and control of the Owner Trustee for the benefit of the Certificateholder. If, at any time, the Collection Account or the Payahead Account ceases to be an Eligible Deposit Account, the Owner Trustee (or the Administrator on behalf of the Owner Trustee, if the Collection Account is not then held by the Owner Trustee or an affiliate thereof) shall within 10 Business Days establish a new equivalent Eligible Deposit Account and shall transfer any cash and/or any investments to such new account. (b) Notwithstanding the foregoing, concurrently with, the execution and delivery of any Indenture pursuant to which the Notes are issued, the Servicer shall establish and maintain, or shall cause to be established and maintained, at the direction of the Depositor, accounts of the Trust ("Trust Accounts") in the name of and under the control of the Indenture Trustee for the benefit of the Securityholders, in each case in accordance with Section 5.01 of the Sale and 11 Servicing Agreement. The Owner Trustee shall thereupon promptly transfer any cash and/or investments then on deposit in the equivalent Trust Accounts maintained by it pursuant to Section 5.01(a) to the newly established Trust Accounts on the terms and conditions set forth in the Sale and Servicing Agreement and the Indenture. The Indenture Trustee will be obligated to transfer back to the equivalent Trust Accounts established pursuant to Section 5.01(a) all funds or investments held or to be held in the Trust Accounts established pursuant to this Section 5.01(b) on the Payment Date on which the Notes of all Classes have been paid in full or the Indenture is otherwise terminated (excluding any amounts to be retained for distribution in respect of Notes that are not promptly delivered for payment on such Payment Date), and to take all necessary or appropriate actions to transfer all right, title and interest of the Indenture Trustee in such funds or investments and all proceeds thereof, to the Owner Trustee for the benefit of the Certificateholder. SECTION 5.02 APPLICATION OF AMOUNTS IN TRUST ACCOUNTS. (a) For so long as any Notes are outstanding, on each Payment Date, the Owner Trustee will take reasonable steps to determine that the Servicer has properly delivered the Servicer's Certificate identifying how amounts on deposit in the Trust Accounts are to be allocated and distributed and will instruct the Indenture Trustee, or cause the Indenture Trustee to be instructed, to distribute to the Certificateholder the amounts distributable thereto pursuant to Section 5.06 of the Sale and Servicing Agreement and Section 3.01 of the Indenture. From and after the date on which the Notes of all Classes have been paid in full, on each Payment Date the Owner Trustee shall distribute to the Certificateholder amounts on deposit in the Collection Account that are distributable to the Certificateholder in accordance with the instructions of the Servicer pursuant to Sections 5.06(c) and (d) of the Sale and Servicing Agreement. Upon the release from the Lien of the Indenture of amounts on deposit in any of the Trust Accounts or any other portion of the Owner Trust Estate, the Owner Trustee will cause such property to be properly deposited into Trust Accounts under the control of the Owner Trustee or distributed to the Certificateholder in accordance with the provisions of this Agreement, as the case may be. (b) On each Payment Date, the Owner Trustee shall send to the Certificateholder the statement provided to the Owner Trustee by the Servicer pursuant to Section 5.08 of the Sale and Servicing Agreement with respect to such Payment Date. (c) In the event that any withholding tax is imposed on the Trust's distributions (or allocations of income) to the Certificateholder, such tax shall reduce the amount otherwise distributable to the Certificateholder in accordance with this Section. The Owner Trustee and Paying Agent are hereby authorized and directed to retain from amounts otherwise distributable to the Certificateholder sufficient funds for the payment of any tax that is legally owed by the Trust (but such authorization shall not prevent the Owner Trustee from contesting any such tax or the withholding requirement with respect to any such tax in appropriate proceedings if permitted by law, pending the outcome of such proceedings). The amount of any withholding tax imposed with respect to the Certificateholder shall be treated as cash distributed to the Certificateholder at the time it is withheld by the Trust and remitted to the appropriate taxing authority. If there is a possibility that withholding tax is payable with respect to any distribution (such as any distribution to a Non-U.S. Person), the Owner Trustee may, in its sole discretion, withhold such amounts in accordance with this paragraph (c). In the event that the 12 Certificateholder wishes to apply for a refund of any such withholding tax, the Owner Trustee shall reasonably cooperate with the Certificateholder in making such claim so long as the Certificateholder agrees to reimburse the Owner Trustee for any out-of-pocket expenses incurred in connection therewith. SECTION 5.03 METHOD OF PAYMENT. Subject to Section 9.01(c), distributions required to be made to the Certificateholder on any Payment Date shall be made to the Certificateholder by wire transfer, in immediately available funds, to the account of the Certificateholder at a bank or other entity having appropriate facilities therefor, if such Certificateholder shall have provided to the Owner Trustee appropriate written instructions at least five Business Days prior to such Payment Date. SECTION 5.04 ACCOUNTING AND REPORTS TO THE NOTEHOLDERS, THE CERTIFICATEHOLDER, THE INTERNAL REVENUE SERVICE AND OTHERS. The Owner Trustee shall (a) maintain (or cause to be maintained) the books of the Trust on a calendar year basis on the accrual method of accounting, (b) deliver to the Certificateholder, as may be required by the Code and applicable Treasury Regulations, such information as may be required (including Schedule K-1) to enable the Certificateholder to prepare its federal and state income tax returns, (c) prepare (or cause to be prepared) and file any tax and information returns, and fulfill any other reporting requirements, relating to the Trust, as may be required by the Code and applicable Treasury Regulations (including Treasury Regulation Section 1.6049-7), including causing such tax and information returns to be signed in the manner required by law, (d) for any period during which the beneficial ownership interests in the Trust are held by more than one person, make such elections as may from time to time be required or appropriate under any applicable state or federal statute or rule or regulation thereunder so as to maintain the Trust's characterization as a partnership for federal income tax purposes, and (e) collect or cause to be collected any withholding tax as described in and in accordance with Section 5.02(c) with respect to income or distributions to the Certificateholder. The Owner Trustee shall elect under Section 1278 of the Code to include in income currently any market discount that accrues with respect to the Receivables. The Owner Trustee shall not make the election provided under Section 754 of the Code. SECTION 5.05 SIGNATURE ON RETURNS; TAX MATTERS PARTNER. (a) The Owner Trustee shall sign on behalf of the Trust the tax returns of the Trust, unless applicable law requires the Certificateholder to sign such documents, in which case such documents shall be signed by the Administrator, pursuant to the power-of-attorney granted thereto pursuant to Section 2.04. (b) For any period during which the beneficial ownership interests of the Trust are held by more than one Person, the Certificateholder holding Certificates evidencing the largest portion of the Certificates shall be designated the "tax matters partner" of the Trust pursuant to Section 6231(a)(7)(A) of the Code and applicable Treasury Regulations, but hereby delegates its powers and duties as such to the Administrator pursuant to the power-of-attorney granted thereto pursuant to Section 2.04. 13 ARTICLE VI AUTHORITY AND DUTIES OF OWNER TRUSTEE SECTION 6.01 GENERAL AUTHORITY. The Owner Trustee is authorized and directed to execute and deliver the Basic Documents to which the Trust is to be a party and each certificate or other document attached as an exhibit to or contemplated by the Basic Documents to which the Trust is to be a party and any amendment thereto, and, on behalf of the Trust, to direct the Indenture Trustee to authenticate and deliver Class A-1 Notes in the aggregate principal amount of $417,840,000, Class A-2 Notes in the aggregate principal amount of $500,000,000, Class A-3 Notes in the aggregate principal amount of $360,000,000 and Class A-4 Notes in the aggregate principal amount of $175,000,000. In addition to the foregoing, the Owner Trustee is authorized, but shall not be obligated, to take all actions required of the Trust, pursuant to the Basic Documents. SECTION 6.02 GENERAL DUTIES. It shall be the duty of the Owner Trustee to discharge (or cause to be discharged) all of its responsibilities pursuant to the terms of this Agreement and the Basic Documents to which the Trust is a party and to administer the Trust in accordance with the provisions hereof and of the Basic Documents and in the interest of the Certificateholder. Notwithstanding the foregoing, the Owner Trustee shall be deemed to have discharged its duties and responsibilities hereunder and under the Basic Documents to the extent the Administrator has agreed in the Administration Agreement to perform any act or to discharge any duty of the Owner Trustee hereunder or under any Basic Document, and the Owner Trustee shall not be held liable for the default or failure of the Administrator to carry out such obligations or fulfill such duties under the Administration Agreement. SECTION 6.03 DUTIES OF OWNER TRUSTEE. (a) Subject to Article IV and in accordance with the terms of the Basic Documents, the Certificateholder may by written instruction direct the Owner Trustee in the management of the Trust. Such direction may be exercised at any time by written instruction of the Certificateholder pursuant to Article IV. (b) The Owner Trustee accepts the trusts hereby created and agrees to perform its duties hereunder with respect to such trusts but only upon the terms of this Agreement. (c) The Owner Trustee, upon receipt of all resolutions, certificates, statements, opinions, reports, documents, orders or other instruments furnished to the Owner Trustee that shall be specifically required to be furnished pursuant to any provision of this Agreement, shall examine them to determine whether they conform on their face to the requirements of this Agreement. (d) No provision of this Agreement shall be construed to relieve the Owner Trustee from liability for its own negligent action, its own negligent failure to act, its own bad faith or its own willful misfeasance; PROVIDED, HOWEVER, that: (i) the duties and obligations of the Owner Trustee shall be determined solely by the express provisions of this Agreement and the Basic 14 Documents, the Owner Trustee shall not be liable except for the performance of such duties and obligations as are specifically set forth in this Agreement and the Basic Documents, no implied covenants or obligations shall be read into this Agreement against the Owner Trustee, the permissive right of the Owner Trustee to do things enumerated in this Agreement and the Basic Documents shall not be construed as a duty and, in the absence of bad faith on the part of the Owner Trustee, the Owner Trustee may conclusively rely, as to the truth of the statements and the correctness of the opinions expressed therein, upon any certificates or opinions furnished to the Owner Trustee and conforming on their face to the requirements of this Agreement and the Basic Documents; (ii) the Owner Trustee shall not be personally liable for an error of judgment made in good faith by a Trust Officer, unless it shall be proved that the Owner Trustee was negligent in performing its duties in accordance with the terms of this Agreement and the Basic Documents; and (iii) the Owner Trustee shall not be personally liable with respect to any action taken, suffered or omitted to be taken in good faith in accordance with the direction of the Certificateholder. (e) The Owner Trustee shall not be required to expend or risk its own funds or otherwise incur financial liability in the performance of any of its duties under this Agreement, or in the exercise of any of its rights or powers, if there shall be reasonable grounds for believing that the repayment of such funds or adequate indemnity against such risk or liability is not reasonably assured to it. (f) All information obtained by the Owner Trustee regarding the Obligors and the Receivables contained in the Trust, whether upon the exercise of its rights under this Agreement or otherwise, shall be maintained by the Owner Trustee in confidence and shall not be disclosed to any other Person, unless such disclosure is required by any applicable law or regulation or pursuant to subpoena. (g) Pursuant to Section 3.02 of the Sale and Servicing Agreement, in the event that the Owner Trustee discovers that a representation or warranty with respect to a Receivable was incorrect as of the time specified with respect to such representation and warranty and such incorrectness materially and adversely affects the interests of the Trust in such Receivable, the Owner Trustee shall give prompt written notice to the Servicer, the Depositor and the Indenture Trustee of such incorrectness. Pursuant to Section 4.08 of the Sale and Servicing Agreement, in the event that the Owner Trustee discovers that any covenant of the Servicer set forth in Section 4.06 or 4.07 of the Sale and Servicing Agreement has been breached by the Servicer and such incorrectness materially and adversely affects the interests of the Trust in any Receivable, the Owner Trustee shall give prompt written notice to the Servicer, the Depositor and the Indenture Trustee of such breach. SECTION 6.04 NO DUTIES EXCEPT AS SPECIFIED IN THIS AGREEMENT OR IN INSTRUCTIONS. The Owner Trustee shall not have any duty or obligation to manage, make any payment with respect to, register, record, sell, dispose of, or otherwise deal with the Owner Trust Estate, or to 15 otherwise take or refrain from taking any action under, or in connection with, any Basic Document or otherwise contemplated hereby to which the Owner Trustee is a party, except as expressly provided by the terms of this Agreement, any Basic Document to which the Trust is a party or in any document or written instruction received by the Owner Trustee pursuant to section 6.03. No implied duties or obligations shall be read into this Agreement or any Basic Document against the Owner Trustee. The Owner Trustee shall have no responsibility for filing any financing or continuation statement in any public office at any time or otherwise to perfect or maintain the perfection of any security interest or lien granted to it hereunder or to prepare or file any Securities and Exchange Commission filing for the Trust or to record this Agreement or any Basic Document. The Owner Trustee nevertheless agrees that it will, at its own cost and expense, promptly take all action as may be necessary to discharge any liens on any part of the Owner Trust Estate that result from actions by, or claims against, the Owner Trustee that are not related to the ownership or the administration of the Owner Trust Estate. SECTION 6.05 NO ACTION EXCEPT UNDER SPECIFIED DOCUMENTS OR INSTRUCTIONS. The Owner Trustee shall not manage, control, use, sell, dispose of or otherwise deal with any part of the Owner Trust Estate except (i) in accordance with the powers granted to and the authority conferred upon the Owner Trustee pursuant to this Agreement, (ii) in accordance with the Basic Documents and (iii) in accordance with any document or instruction delivered to the Owner Trustee pursuant to Section 6.03. SECTION 6.06 RESTRICTIONS. The Owner Trustee shall not take any action (a) that is inconsistent with the purposes of the Trust set forth in Section 2.03 or (b) that, to the actual knowledge of the Owner Trustee, would result in the Trust's becoming taxable as a corporation for Federal income tax purposes. The Certificateholder shall not have the authority to and, by acceptance of an ownership interest in the Certificate shall thereby be deemed to have covenanted not to, direct the Owner Trustee to take action that would violate the provisions of this Section. ARTICLE VII CONCERNING THE OWNER TRUSTEE SECTION 7.01 RIGHTS OF OWNER TRUSTEE. Except as otherwise provided in Article VI: (a) in accordance with Section 7.04, the Owner Trustee may rely and shall be protected in acting or refraining from acting upon any resolution, Officer's Certificate, certificate of an authorized signatory, certificate of auditors or any other certificate, statement, instrument, opinion, report, notice, request, consent, order, appraisal, bond or other paper or document believed by it to be genuine and to have been signed or presented by the proper party or parties; (b) the Owner Trustee shall not be liable with respect to any action taken or omitted to be taken by it in accordance with the instructions of the Administrator, as provided in the Administration Agreement, or the Certificateholder, as provided herein; (c) the Owner Trustee shall be under no obligation to exercise any of the rights or powers vested in it by this Agreement or the Sale and Servicing Agreement, or to institute, 16 conduct or defend any litigation under this Agreement, or in relation to this Agreement or the Sale and Servicing Agreement, at the request, order or direction of any of the Securityholders pursuant to the provisions of this Agreement or the Sale and Servicing Agreement, unless such Securityholders shall have offered to the Owner Trustee reasonable security or indemnity against the costs, expenses and liabilities that may be incurred therein or thereby; (d) under no circumstances shall the Owner Trustee be liable for indebtedness evidenced by or arising under any of the Basic Documents, including the principal of and interest on the Notes; (e) the Owner Trustee shall not be bound to recalculate, reverify, or make any investigation into the facts of matters stated in any resolution, certificate, statement, instrument, opinion, report, notice, request, consent, order, approval, bond or other paper or document, unless requested in writing to do so by the Certificateholder; PROVIDED, HOWEVER, that if the payment within a reasonable time to the Owner Trustee of the costs, expenses or liabilities likely to be incurred by it in the making of such investigation is, in the opinion of the Owner Trustee, not reasonably assured to the Owner Trustee by the security afforded to it by the terms of this Agreement, the Owner Trustee may require reasonable indemnity against such cost, expense or liability as a condition to so proceeding; the reasonable expense of every such examination shall be paid by the Administrator or, if paid by the Owner Trustee, shall be reimbursed by the Administrator upon demand; and nothing in this clause shall derogate from the obligation of the Servicer to observe any applicable law prohibiting disclosure of information regarding the Obligors; and (f) the Owner Trustee shall not be liable for the default or misconduct of the Administrator, the Servicer, the Depositor or the Indenture Trustee under any of the Basic Documents or otherwise, and the Owner Trustee shall have no obligation or liability to perform the obligations of the Trust under the Basic Documents that are required to be performed by the Administrator under the Administration Agreement, the Indenture Trustee under the Indenture or the Servicer under the Sale and Servicing Agreement. SECTION 7.02 FURNISHING OF DOCUMENTS. The Owner Trustee shall furnish (a) to the Certificateholder promptly upon receipt of a written request therefor, duplicates or copies of all reports, notices, requests, demands, certificates, financial statements and any other instruments furnished to the Owner Trustee under the Basic Documents and (b) to Noteholders promptly upon written request therefor, copies of the Sale and Servicing Agreement, the Administration Agreement and the Trust Agreement. SECTION 7.03 REPRESENTATIONS AND WARRANTIES. The Owner Trustee hereby represents and warrants to the Depositor and for the benefit of the Certificateholder, that: (a) It is a national banking association duly organized and existing and in good standing under the laws of the United States. It has full power, authority and right to execute, deliver and perform its obligations under this Agreement and each other Basic Document. (b) It has taken all corporate action necessary to authorize the execution and delivery of this Agreement and each other Basic 17 Document, and this Agreement and each other Basic Document has been executed and delivered by one of its officers duly authorized to execute and deliver this Agreement and each other Basic Document on its behalf. (c) This Agreement constitutes the legal, valid and binding obligation of the Owner Trustee, enforceable against it in accordance with its terms except as the enforceability thereof may be limited by bankruptcy, insolvency, moratorium, reorganization or other similar laws affecting the enforcement of creditors' rights generally and by general principles of equity. (d) It is authorized to exercise trust powers in the State of Delaware as and to the extent contemplated herein and it has a principal place of business in the State of Delaware. SECTION 7.04 RELIANCE; ADVICE OF COUNSEL. (a) The Owner Trustee shall incur no liability to anyone in acting upon any signature, instrument, notice, resolution, request, consent, order, certificate, report, opinion, bond, or other document or paper believed by it to be genuine and believed by it to be signed by the proper party or parties. The Owner Trustee may accept a certified copy of a resolution of the board of directors or other governing body of any corporate party as conclusive evidence that such resolution has been duly adopted by such body and that the same is in full force and effect. As to any fact or matter the method of the determination of which is not specifically prescribed herein, the Owner Trustee may for all purposes hereof rely on a certificate, signed by the president or any vice president or by the treasurer or other authorized officers or agents of the relevant party, as to such fact or matter and such certificate shall constitute full protection to the Owner Trustee for any action taken or omitted to be taken by it in good faith in reliance thereon. (b) In the exercise or administration of the trusts hereunder and in the performance of its duties and obligations under the Basic Documents, the Owner Trustee (i) may act directly or through its agents or attorneys pursuant to agreements entered into with any of them, and the Owner Trustee shall not be liable for the conduct or misconduct of such agents or attorneys if such agents or attorneys shall have been selected by the Owner Trustee with reasonable care, and (ii) may consult with counsel, accountants and other skilled persons to be selected with reasonable care and employed by it. The Owner Trustee shall not be liable for anything done, suffered or omitted in good faith by it in accordance with the written opinion or advice of any such counsel, accountants or other such persons and not contrary to this Agreement or any Basic Document. SECTION 7.05 NOT ACTING IN INDIVIDUAL CAPACITY. In accepting the trusts hereby created, First Union Trust Company, National Association acts solely as Owner Trustee hereunder and not in its individual capacity. Except with respect to a claim based on the failure of the Owner Trustee to perform its duties under this Agreement or based on the Owner Trustee's willful misconduct, bad faith or negligence, no recourse shall be had for any claim based on any provision of this Agreement, the Notes or the Certificate, or based on rights obtained through the assignment of any of the foregoing, against the institution serving as the Owner Trustee in its individual capacity. The Owner Trustee shall not have any personal obligation, liability or duty whatsoever to any Securityholder or any other Person with respect to any such claim, and any such claim shall be asserted solely against the Trust or any indemnitor who shall furnish indemnity as provided in this Indenture. 18 SECTION 7.06 OWNER TRUSTEE NOT LIABLE FOR THE CERTIFICATE OR RECEIVABLES. The Owner Trustee makes no representations as to the validity or sufficiency of this Agreement or of the Certificate or of the Notes (other than the execution by the Owner Trustee on behalf of the Trust of, and the certificate of authentication on, the Certificate, and the direction of the Owner Trustee, on behalf of the Trust, to the Indenture Trustee relating to the execution of the Notes). The Owner Trustee shall have no obligation to perform any of the duties of the Servicer or Administrator unless explicitly set forth in this Agreement. The Owner Trustee shall at no time have any responsibility or liability for or with respect to the legality, validity and enforceability of the Certificate, the Notes or any Receivable, any ownership interest in any Financed Vehicle, or the maintenance of any such ownership interest, or for or with respect to the efficacy of the Trust or its ability to generate the payments to be distributed to Securityholders under this Agreement and the Indenture, including without limitation the validity of the assignment of the Receivables to the Trust or of any intervening assignment; the existence, condition, location and ownership of any Receivable or Financed Vehicle; the existence and enforceability of any physical damage or credit life or credit disability insurance; the existence and contents of any retail installment sales contract or any computer or other record thereof; the completeness of any retail installment sales contract; the performance or enforcement of any retail installment sales contract; the compliance by the Trust with any covenant or the breach by the Trust of any warranty or representation made under this Agreement or in any related document and the accuracy of any such warranty or representation prior to the Owner Trustee's receipt of notice or other discovery of any noncompliance therewith or any breach thereof; the acts or omissions of the Trust or the Servicer; or any action by the Owner Trustee taken at the instruction of the Certificateholder, PROVIDED, HOWEVER, that the foregoing shall not relieve the Owner Trustee of its obligation to perform its duties under this Agreement. The Owner Trustee shall not be accountable for: (i) the use or application by the Depositor of the proceeds of the sale of the Notes; (ii) the use or application by the Certificateholder of the Certificate or the proceeds of the Certificate; (iii) the use or application by the holder of any Notes of any of the Notes or of the proceeds of such Notes; or (iv) the use or application of any funds paid to the Servicer in accordance with the Sale and Servicing Agreement. SECTION 7.07 OWNER TRUSTEE MAY OWN THE NOTES. The Owner Trustee in its individual or any other capacity may become the owner or pledgee of the Notes and may deal with the Depositor, the Company, the Administrator, the Indenture Trustee and the Servicer in banking or other transactions with the same rights as it would have if it were not Owner Trustee. SECTION 7.08 SALES FINANCE COMPANY LICENSES. The Owner Trustee (or the Administrator on its behalf, pursuant to Section 1(b) of the Administration Agreement) shall cause the Trust to use its best efforts to maintain the effectiveness of all licenses required under the Pennsylvania Motor Vehicle Sales Finance Act and Maryland Sales Finance Company licensing regulations in connection with this Agreement and the Basic Documents and the transactions contemplated hereby and thereby until such time as the Trust shall terminate in accordance with the terms hereof. 19 ARTICLE VIII COMPENSATION OF OWNER TRUSTEE SECTION 8.01 OWNER TRUSTEE'S FEES AND EXPENSES. The Trust shall pay or shall cause the Servicer to pay to the Owner Trustee from time to time compensation for its services as have been separately agreed upon before the date hereof, and the Owner Trustee shall be entitled to be reimbursed by the Administrator for its other reasonable expenses hereunder, including the reasonable compensation, expenses and disbursements of such agents, representatives, experts and counsel as the Owner Trustee may employ in connection with the exercise and performance of its rights and its duties hereunder. SECTION 8.02 INDEMNIFICATION. The Administrator shall, pursuant to the Administration Agreement and the following provisions, reimburse the Owner Trustee for all reasonable out-of-pocket expenses incurred or made by it, including costs of collection, in addition to the compensation for its services. Such expenses shall include the reasonable compensation and expenses, disbursements and advances of the Owner Trustee's agents, counsel, accountants and experts directly related to its services hereunder ("Expenses") The Administrator shall indemnify or shall cause the Servicer to indemnify the Owner Trustee against any and all loss, liability or expense (including attorneys' fees) incurred by it in connection with the administration of this trust and the performance of its duties hereunder. The Owner Trustee shall notify the Administrator and the Servicer promptly of any claim for which it may seek indemnity. Failure by the Owner Trustee to so notify the Administrator and the Servicer shall not relieve the Administrator or the Servicer of its obligations hereunder, where such failure shall not affect the Administrator's or Servicer's defenses in respect thereof. In case any such action is brought against the Owner Trustee under this Section 8.02 and it notifies the Administrator of the commencement thereof, the Administrator will assume the defense thereof, with counsel reasonably satisfactory to the Owner Trustee (who may, unless there is, as evidenced by an opinion of counsel to the Owner Trustee stating that there is an unwaivable conflict of interest, be counsel to the Administrator), and the Administrator will not be liable to the Owner Trustee under this Section for any legal or other expenses subsequently incurred by the Owner Trustee in connection with the defense thereof, other than reasonable costs of investigation. Neither the Administrator nor the Servicer need reimburse any expense or indemnify against any loss, liability or expense incurred by the Owner Trustee through the Owner Trustee's own willful misconduct, negligence or bad faith. SECTION 8.03 PAYMENTS TO THE OWNER TRUSTEE. Any amounts paid to the Owner Trustee pursuant to this Article VIII from assets in the Owner Trust Estate shall be deemed not to be a part of the Owner Trust Estate immediately after such payment. 20 ARTICLE IX TERMINATION OF TRUST AGREEMENT SECTION 9.01 TERMINATION OF TRUST AGREEMENT. (a) This Agreement (other than Article VIII) shall terminate and the Trust shall dissolve and be of no further force or effect, upon the earliest of (i) the maturity or other liquidation of the last Receivable (or other asset) in the Owner Trust Estate and the final distribution by the Owner Trustee of all moneys or other property or proceeds of the Owner Trust Estate in accordance with the terms of this Agreement, the Indenture and the Sale and Servicing Agreement (including, but not limited to, any property and proceeds to be deposited in the Collection Account pursuant to Sections 3.02, 4.08, 5.02, 5.04, 5.05, 5.06 or 9.01 of the Sale and Servicing Agreement or to be released by the Indenture Trustee from the Lien of the Indenture pursuant to Section 10.01 or 10.02 of the Indenture), (ii) the payment or distribution to all Securityholders of all amounts specified in Sections 3.02, 4.08, 5.02, 5.04, 5.05, 5.06 or 9.01 of the Sale and Servicing Agreement or (iii) the dissolution of the Trust that results from the occurrence of an Insolvency Event with respect to the Depositor as provided in Section 9.02. (b) Except as provided in Section 9.01(a), the Certificateholder shall not be entitled to revoke or terminate the Trust. (c) Notice of any termination of the Trust, specifying the Payment Date upon which the Certificateholder shall surrender the Certificate to the Paying Agent for payment of the final distributions and cancellation, shall be given by the Owner Trustee to the Certificateholder mailed within five Business Days of receipt of notice of such termination from the Servicer given pursuant to Section 10.03 of the Sale and Servicing Agreement, stating (i) the Payment Date upon or with respect to which final payment of the Certificate shall be made upon presentation and surrender of the Certificate at the office of the Paying Agent therein designated, (ii) the amount of any such final payment and (iii) that payment to be made on such Payment Date will be made only upon presentation and surrender of the Certificate at the office of the Paying Agent therein specified. The Owner Trustee shall give such notice to the Paying Agent (if other than the Owner Trustee) at the time such notice is given to the Certificateholder. Upon presentation and surrender of the Certificate, the Paying Agent shall cause to be distributed to the Certificateholder amounts distributable on such Payment Date pursuant to Section 5.02. In the event that the Certificateholder shall not surrender the Certificate for cancellation within six months after the date specified in the above mentioned written notice, the Owner Trustee shall give a second written notice to the Certificateholder to surrender the Certificate for cancellation and receive the final distribution with respect thereto. If within one year after the second notice the Certificate shall not have been surrendered for cancellation, the Owner Trustee may take appropriate steps, or may appoint an agent to take appropriate steps, to contact the Certificateholder concerning surrender of its Certificate, and the cost thereof shall be paid out of the funds and other assets that shall remain subject to this Agreement. Any funds remaining in the Trust after exhaustion of such remedies shall be distributed by the Owner Trustee to the Depositor. 21 (d) Upon the winding up of the Trust and its termination, the Owner Trustee shall cause the Certificate of Trust to be cancelled by filing a certificate of cancellation with the Secretary of State in accordance with the provisions of Section 3820 of the Business Trust Statute. SECTION 9.02 DISSOLUTION UPON INSOLVENCY OF THE DEPOSITOR. In the event that an Insolvency Event shall occur with respect to the Depositor, this Agreement shall be terminated in accordance with Section 9.01 90 days after the date of such Insolvency Event, unless, before the end of such 90-day period, the Owner Trustee shall have received written instructions from the Indenture Trustee (or the Indenture Trustee acting on behalf of the Class A Notes pursuant to Section 5.04(c) of the Indenture) or the Holders of at least 51% of the Outstanding Amount of the Class A Notes acting together as a single Class (excluding for such purposes the outstanding principal amount of any Class A Notes held of record or beneficially owned by TMCC, TAFR LLC or any of their Affiliates) or if only the Certificate is then outstanding, the Certificateholder, to the effect that the Receivables should not be liquidated and the Trust should not be terminated. Promptly after the occurrence of any Insolvency Event with respect to the Depositor, (A) the Depositor shall give the Indenture Trustee, the Owner Trustee and each Rating Agency written notice of such Insolvency Event and (B) upon the receipt of such written notice from the Depositor, the Indenture Trustee and Owner Trustee, respectively, shall give prompt written notice thereof to the Noteholders and the Certificateholder; PROVIDED, HOWEVER, that any failure to give a notice required by this sentence to a party not then entitled to instruct the Owner Trustee that the dissolution should not occur shall not prevent or delay, in any manner, a termination of the Trust pursuant to the first sentence of this Section 9.02. Upon a termination pursuant to this Section 9.02, the Owner Trustee promptly shall, or if any Notes are outstanding, the Indenture Trustee (or relevant Indenture Trustee for the relevant Class or Classes of Notes pursuant to Section 5.04(e) of the Indenture) shall, promptly sell the assets of the Trust (other than funds on deposit in the Collection Account, Payahead Account and Reserve Fund) in a commercially reasonable manner and on commercially reasonable terms and, if any Notes are outstanding, in accordance with the terms of the Indenture. The proceeds of such a sale of the assets of the Trust shall be treated as collections under the Sale and Servicing Agreement and shall be deposited in the Collection Account and distributed pursuant to the terms of Section 5.06 of the Sale and Servicing Agreement. ARTICLE X SUCCESSOR OWNER TRUSTEES AND ADDITIONAL OWNER TRUSTEES SECTION 10.01 ELIGIBILITY REQUIREMENTS FOR OWNER TRUSTEE. The Owner Trustee shall at all times be an entity having a combined capital and surplus of at least $50,000,000 and subject to supervision or examination by federal or state authorities. If such entity shall publish reports of condition at least annually, pursuant to law or to the requirements of the aforesaid supervising or examining authority, then for the purpose of this Section 10.01, the combined capital and surplus of such corporation shall be deemed to be its combined capital and surplus as set forth in its most recent report of condition so published. In case at any time the Owner Trustee shall cease to be eligible in accordance with the provisions of this Section, the Owner Trustee shall resign immediately in the manner and with the effect specified in Section 10.02. 22 SECTION 10.02 RESIGNATION OR REMOVAL OF OWNER TRUSTEE. The Owner Trustee may at any time resign and be discharged from the trusts hereby created by giving written notice thereof to the Depositor, the Servicer and the Indenture Trustee. Upon receiving such notice of resignation, the Servicer shall promptly appoint a successor Owner Trustee by written instrument, in duplicate, one copy of which shall be delivered to each of the resigning Owner Trustee and the successor Owner Trustee. If no successor Owner Trustee shall have been so appointed or shall not have accepted such appointment within 30 days after the giving of such notice of resignation, the resigning Owner Trustee may petition any court of competent jurisdiction for the appointment of a successor Owner Trustee. If at any time the Owner Trustee shall cease to be eligible in accordance with the provisions of Section 10.01 and shall fail to resign promptly, or if at any time the Owner Trustee shall be legally unable to act, or shall be adjudged bankrupt or insolvent, or a receiver of the Owner Trustee or of its property shall be appointed, or any public officer shall take charge or control of the Owner Trustee or of its property or affairs for the purpose of rehabilitation, conservation or liquidation, then the Administrator may remove the Owner Trustee by written instrument to such effect delivered to the Owner Trustee, the Depositor and the Indenture Trustee. If the Administrator shall remove the Owner Trustee under the authority of the immediately preceding sentence, the Servicer shall promptly appoint a successor Owner Trustee by written instrument in duplicate, one copy of which instrument shall be delivered to each of the outgoing Owner Trustee so removed and the successor Owner Trustee and shall pay or cause to be paid all fees, expenses and other compensation then owed to the outgoing Owner Trustee. Any resignation or removal of the Owner Trustee and appointment of a successor Owner Trustee pursuant to any of the provisions of this Section shall not become effective until acceptance of appointment by the successor Owner Trustee pursuant to Section 10.03 and payment of all fees and expenses owed to the outgoing Owner Trustee. The Administrator shall provide notice of such resignation or removal of the Owner Trustee to each of the Rating Agencies. SECTION 10.03 SUCCESSOR OWNER TRUSTEE. Any successor Owner Trustee appointed pursuant to Section 10.02 shall execute, acknowledge and deliver to the Administrator and to its predecessor Owner Trustee an instrument accepting such appointment under this Agreement, and thereupon the resignation or removal of the predecessor Owner Trustee shall become effective and such successor Owner Trustee, without any further act, deed or conveyance, shall become fully vested with all the rights, powers, duties, and obligations of its predecessor under this Agreement, with like effect as if originally named as Owner Trustee. The predecessor Owner Trustee shall upon payment of its fees and expenses deliver to the successor Owner Trustee all documents and statements and monies held by it under this Agreement; and the Administrator and the predecessor Owner Trustee shall execute and deliver such instruments and do such other things as may reasonably be required for fully and certainly vesting and confirming in the successor Owner Trustee all such rights, powers, duties, and obligations. No successor Owner Trustee shall accept appointment as provided in this Section unless at the time of such acceptance such successor Owner Trustee shall meet the criteria for eligibility set forth in Section 10.01. 23 Upon acceptance of appointment by a successor Owner Trustee pursuant to this Section, the Administrator shall mail notice of the successor of such Owner Trustee to the Certificateholder, the Indenture Trustee, the Noteholders and the Rating Agencies. If the Administrator fails to mail such notice within 10 days after acceptance of appointment by the successor Owner Trustee, the successor Owner Trustee shall cause such notice to be mailed at the expense of the Administrator. SECTION 10.04 MERGER OR CONSOLIDATION OF OWNER TRUSTEE. Any corporation into which the Owner Trustee may be merged or converted or with which it may be consolidated or any corporation resulting from any merger, conversion or consolidation to which the Owner Trustee shall be a party, or any corporation succeeding to all or substantially all of the corporate trust business of the Owner Trustee, shall be the successor of the Owner Trustee hereunder, provided such corporation shall be eligible pursuant to Section 10.01, without the execution or filing of any instrument or any further act on the part of any of the parties hereto, anything herein to the contrary notwithstanding; PROVIDED, FURTHER, that the Owner Trustee shall mail notice of such merger or consolidation to the Rating Agencies. SECTION 10.05 APPOINTMENT OF CO-TRUSTEE OR SEPARATE TRUSTEE. Notwithstanding any other provisions of this Agreement, at any time, for the purpose of meeting any legal requirements of any jurisdiction in which any part of the Owner Trust Estate or any Financed Vehicle may at the time be located, the Administrator and the Owner Trustee acting jointly shall have the power and shall execute and deliver all instruments to appoint one or more Persons approved by the Owner Trustee to act as co-trustee, jointly with the Owner Trustee, or separate trustee or separate trustees, of all or any part of the Owner Trust Estate, and to vest in such Person, in such capacity, such title to the Trust, or any part thereof, and, subject to the other provisions of this Section, such powers, duties, obligations, rights and trusts as the Administrator and the Owner Trustee may consider necessary or desirable. If the Administrator shall not have joined in such appointment within 25 days after the receipt by it of a request so to do, the Owner Trustee alone shall have the power to make such appointment. No co-trustee or separate trustee under this Agreement shall be required to meet the terms of eligibility as a successor trustee pursuant to Section 10.01 and no notice of the appointment of any co-trustee or separate trustee shall be required pursuant to Section 10.03. Each separate trustee and co-trustee shall, to the extent permitted by law, be appointed and act subject to the following provision and conditions: (i) all rights, powers, duties and obligations conferred or imposed upon the Owner Trustee shall be conferred upon and exercised or performed by the Owner Trustee and such separate trustee or co-trustee jointly (it being understood that such separate trustee or co-trustee is not authorized to act separately without the Owner Trustee joining in such act), except to the extent that under any law of any jurisdiction in which any particular act or acts are to be performed, the Owner Trustee shall be incompetent or unqualified to perform such act or acts, in which event such rights, powers, duties, and obligations (including the holding of title to the Trust or any portion thereof in any such jurisdiction) shall be exercised and performed singly by such separate trustee or co-trustee, but solely at the direction of the Owner Trustee; 24 (ii) no trustee under this Agreement shall be personally liable by reason of any act or omission of any other trustee under this Agreement; and (iii) the Administrator and the Owner Trustee acting jointly may at any time accept the resignation of or remove any separate trustee or co-trustee. Any notice, request or other writing given to the Owner Trustee shall be deemed to have been given to each of the then separate trustees and co-trustees, as if given to each of them. Each separate trustee and co-trustee, upon its acceptance of the powers and duties conferred thereto under this Agreement, shall be vested with the estates or specified in its instrument of appointment, either jointly with the Owner Trustee or separately, as may be provided therein, subject to all the provisions of this Agreement, specifically including every provision of this Agreement relating to the conduct of, affecting the liability of, or affording protection to, the Owner Trustee. Each such instrument shall be filed with the Owner Trustee and a copy thereof given to the Administrator. SECTION 10.06 POWER OF ATTORNEY FOR CO-TRUSTEE OR SEPARATE TRUSTEE. Any separate trustee or co-trustee may at any time appoint the Owner Trustee as its agent or attorney-in-fact with full power and authority, to the extent not prohibited by law, to do any lawful act under or in respect of this Agreement on its behalf and in its name. If any separate trustee or co-trustee shall die, become incapable of acting, resign or be removed, all of its estates, properties, rights, remedies and trusts shall vest in and be exercised by the Owner Trustee, to the extent permitted by law, without the appointment of a new or successor trustee. ARTICLE XI MISCELLANEOUS SECTION 11.01 SUPPLEMENTS AND AMENDMENTS. This Agreement may be amended by the Depositor and the Owner Trustee, with prior written notice to the Rating Agencies, without the consent of any of the Noteholders or the Certificateholder, to cure any ambiguity, to correct or supplement any provisions in this Agreement or for the purpose of adding any provisions to or changing in any manner or eliminating any of the provisions in this Agreement or of modifying in any manner the rights of the Noteholders or the Certificateholder, if (a) the Indenture Trustee and Owner Trustee receive an Opinion of Counsel to the effect that such action will not adversely affect in any material respect the interests of any Noteholder or the Certificateholder, or (b) the Indenture Trustee or Owner Trustee, as the case may be, have received the consent of (i) the Holders of at least 51% of the Outstanding Amount of the affected Class A Notes acting as a single Class (excluding for such purposes the outstanding principal amount of any Class A Notes held of record or beneficially owned by TMCC, TAFR LLC or any of their Affiliates) or (ii) if the Class A Notes have been paid in full, the Certificateholder, if affected, PROVIDED, HOWEVER, that no such amendment made pursuant to clause (b) above shall (i) increase or reduce in any manner the amount of, or accelerate or delay the timing of, collections of payments on Receivables or distributions that shall be required to be made for the benefit of the Noteholders or the Certificateholder or (ii) reduce the aforesaid percentage of the Outstanding Amount of the 25 Notes or the Certificate required to consent to any such amendment, without the consent of the Holders of all the affected Notes and the Certificate. This Agreement may also be amended from time to time by the Depositor, the Owner Trustee and the Indenture Trustee without the consent of any of the Noteholders or the Certificateholder for purposes of changing the formula for determining the Specified Reserve Account Balance, the manner in which the Reserve Account is funded (e.g. to allow the deposit of cash therein by the Depositor), changing the remittance schedule for the deposit of collections in the Collection Account or Payahead Account or changing the definition of Eligible Investments, if (a) the Owner Trustee and Indenture Trustee (i) have received from each Rating Agency that has rated any outstanding Class of Notes (excluding Moody's) of its written confirmation that such amendment will not result in the qualification, withdrawal or modification of the rating then assigned by such Rating Agency to any Class of Notes and (ii) have provided Moody's with 10 days prior written notice of such amendment and Moody's shall not have notified the Owner Trustee and the Indenture Trustee that such amendment might or would result in the qualification, reduction or withdrawal of the rating it has currently assigned to any Class of Notes, without the consent of any of the Noteholders or the Certificateholder, or (b) the Indenture Trustee or Owner Trustee, as the case may be, have received the consent of (i) the Holders of at least 51% of the Outstanding Amount of the Class A Notes acting as a single Class (excluding for such purposes the outstanding principal amount of any Class A Notes held of record or beneficially owned by TMCC, TAFR LLC or any of their Affiliates) or (ii) after the Class A Notes have been paid in full, the Certificateholder; PROVIDED, HOWEVER, that no such amendment shall (a) increase or reduce in any manner the amount of, or accelerate or delay the timing of, collections of payments on Receivables or distributions that shall be required to be made for the benefit of the Noteholders or the Certificateholder or (b) reduce the aforesaid percentage of the Outstanding Amount of the Notes required to consent to any such amendment, without the consent of the Holders of all the affected Notes and the Certificate. Promptly after the execution of any such amendment or consent, the Owner Trustee shall furnish written notification of the substance of such amendment or consent to the Certificateholder, the Indenture Trustee and each of the Rating Agencies. It shall not be necessary for the consent of the Certificateholder, the Noteholders or the Indenture Trustee pursuant to this Section to approve the particular form of any proposed amendment or consent, but it shall be sufficient if such consent shall approve the substance thereof. The manner of obtaining such consents (and any other consents of Certificateholder provided for in this Agreement or in any other Basic Document) and of evidencing the authorization of the execution thereof by the Certificateholder shall be subject to such reasonable requirements as the Owner Trustee may prescribe. Promptly after the execution of any amendment to the Certificate of Trust, the Owner Trustee shall cause the filing of such amendment with the Secretary of State. Prior to the execution of any amendment to this Agreement or any amendment to the Certificate of Trust, the Owner Trustee shall be entitled to receive and rely upon an Opinion of Counsel stating that the execution of such amendment is authorized or permitted by this 26 Agreement. The Owner Trustee shall not be obligated to enter into any such amendment which affects the Owner Trustee's own rights, duties or immunities under this Agreement or otherwise. SECTION 11.02 NO LEGAL TITLE TO OWNER TRUST ESTATE IN THE CERTIFICATEHOLDER. The Certificateholder shall not have legal title to any part of the Owner Trust Estate. The Certificateholder shall be entitled to receive distributions with respect to its fractional undivided ownership interest therein only in accordance with Articles V and IX. No transfer, by operation of law or otherwise, of any right, title, or interest of the Certificateholder to and in its ownership interest in the Owner Trust Estate shall operate to terminate this Agreement or the trusts hereunder or entitle any transferee to an accounting or to the transfer to it of legal title to any part of the Owner Trust Estate. SECTION 11.03 LIMITATIONS ON RIGHTS OF OTHERS. Except for Section 2.06, the provisions of this Agreement are solely for the benefit of the Owner Trustee, the Depositor, TMCC, the Certificateholder, the Administrator and, to the extent expressly provided herein the Indenture Trustee, the Noteholders, and nothing in this Agreement, (other than Section 2.06), whether express or implied, shall be construed to give to any other Person any legal or equitable right, remedy or claim in the Owner Trust Estate or under or in respect of this Agreement or any covenants, conditions or provisions contained herein. SECTION 11.04 NOTICES. (a) Unless otherwise expressly specified or permitted by the terms hereof, all notices shall be in writing and shall be deemed given upon receipt by the intended recipient or three Business Days after mailing if mailed by certified mail, postage prepaid (except that notice to the Owner Trustee shall be deemed given only upon actual receipt by the Owner Trustee), if to the Owner Trustee, addressed to the Corporate Trust Office; if to the Depositor, addressed to Toyota Auto Finance Receivables LLC, 19300 Gramercy Place, North Building, Torrance, California 90509, Attention: President; if, to the Trust, addressed to Toyota Auto Receivables 2001-B Owner Trust, 19001 South Western Avenue, Torrance, California 90509, Attention: Treasury Department: Vice President, Treasury; or, as to each party, at such other address as shall be designated by such party in a written notice to each other party. (b) Any notice required or permitted to be given to the Certificateholder shall be given by first-class mail, postage prepaid, at the address provided by the Certificateholder. Any notice so mailed within the time prescribed in this Agreement shall be conclusively presumed to have been duly given, whether or not the Certificateholder receives such notice. SECTION 11.05 SEVERABILITY. If any one or more of the covenants, agreements, provisions or terms of this Agreement shall be for any reason whatsoever held invalid or unenforceable in any jurisdiction, then such covenants, agreements, provisions or terms shall be deemed severable from the remaining covenants, agreements, provisions or terms of this Agreement and shall in no way affect the validity or enforceability of the other provisions of this Agreement or of the Certificate or the rights of the Holder thereof. 27 SECTION 11.06 COUNTERPARTS. This Agreement may be executed simultaneously in any number of counterparts, each of which shall be deemed to be an original, and all of which shall constitute but one and the same instrument. SECTION 11.07 SUCCESSORS AND ASSIGNS. All covenants and agreements contained herein shall be binding upon, and inure to the benefit of, the Depositor, the Owner Trustee, the Certificateholder and their respective successors and permitted assigns, all as herein provided. Any request, notice, direction, consent, waiver or other instrument or action by the Depositor or the Certificateholder shall bind the successors and assigns thereof. SECTION 11.08 NO PETITION. The Owner Trustee (not in its individual capacity but solely as Owner Trustee), by entering into this Agreement, hereby covenants and agrees, and the Indenture Trustee and any Noteholder (excluding TMCC, TAFR LLC or any of their Affiliates) by accepting the benefits of this Agreement, are thereby deemed to covenant and agree that they will not at any time prior to the date one year plus one day after the date on which this Agreement is terminated institute against the Depositor or the Trust, or join in any institution against the Depositor or the Trust of, any bankruptcy, reorganization, arrangement, insolvency or liquidation proceedings, or other proceedings under any federal or state bankruptcy or similar law. This Section 12.08 shall survive the termination of this Agreement or the termination of the Owner Trustee under this Agreement. SECTION 11.09 NO RECOURSE. The Certificateholder by accepting the Certificate acknowledges that the Certificate represents a beneficial interests in the Trust only and does not represent an interest in or obligation of the Depositor, TMCC (in any capacity), the Administrator, the Owner Trustee, the Indenture Trustee or any Affiliate thereof and no recourse may be had against such parties or their assets, except as may be expressly set forth or contemplated in the Certificate or the Basic Documents. SECTION 11.10 HEADINGS. The headings of the various Articles and Sections herein are for convenience of reference only and shall not define or limit any of the terms or provisions hereof. SECTION 11.11 GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF DELAWARE, WITHOUT REFERENCE TO ITS CONFLICT OF LAW PROVISIONS, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS. SECTION 11.12 TMCC PAYMENT OBLIGATION. The parties hereto acknowledge and agree that, pursuant to the Sale and Servicing Agreement and the following provisions, the Servicer shall be responsible for payment of the Administrator's fees under the Administration Agreement and shall reimburse the Administrator for all expenses and liabilities of the Administrator incurred thereunder. In addition, the parties hereto acknowledge and agree that, pursuant to the Sale and Servicing Agreement and the following provisions, the Servicer shall be responsible for the payment of all fees and expenses of the Trust, the Owner Trustee and the Indenture Trustee paid by any of them in connection with any of their obligations under the Basic Documents to obtain or maintain any required license under the Pennsylvania Motor Vehicle Sales Finance 28 Act. The parties hereto covenant and agree that neither of them shall look to the other for payment of any such fees or expenses. [REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK] 29 IN WITNESS WHEREOF, the parties hereto have caused this Trust Agreement to be duly executed by their respective officers hereunto duly authorized, as of the day and year first above written. TOYOTA AUTO FINANCE RECEIVABLES LLC, Depositor By: /s/ Lloyd Mistele ----------------------------------- Name: Lloyd Mistele Title: President FIRST UNION TRUST COMPANY, NATIONAL ASSOCIATION, not in its individual capacity but solely as Owner Trustee By: /s/ Sterling C. Correia ----------------------------------- Name: Sterling C. Correia Title: Vice President S-1 EXHIBIT A FORM OF CERTIFICATE EVIDENCING SUBORDINATED SELLER'S INTEREST THIS CERTIFICATE DOES NOT CONSTITUTE AN OBLIGATION OF OR AN INTEREST IN THE DEPOSITOR, THE OWNER TRUSTEE, THE SERVICER, THE ADMINISTRATOR, TMCC, TAFR LLC OR ANY OF THEIR RESPECTIVE AFFILIATES, AND WILL NOT BE INSURED OR GUARANTEED BY ANY SUCH ENTITY OR BY ANY GOVERNMENTAL AGENCY. THIS CERTIFICATE HAS NOT BEEN REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE "1933 ACT"), OR THE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES. THIS CERTIFICATE MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED EXCEPT IN ACCORDANCE WITH THE PROVISIONS OF THE TRUST AGREEMENT. NUMBER R-1 TOYOTA AUTO RECEIVABLES 2001-B OWNER TRUST SUBORDINATED SELLER'S INTEREST THIS CERTIFIES THAT TOYOTA AUTO FINANCE RECEIVABLES LLC is the registered owner of 100% of the nonassessable, fully-paid, fractional undivided interest in Toyota Auto Receivables 2001-B Owner Trust (the "Trust") formed by TAFR LLC. The Trust was created pursuant to a Trust Agreement dated as of March 23, 2001, between TAFR LLC as depositor (the "Depositor") and First Union Trust Company, National Association, as Owner Trustee (the "Owner Trustee"), as amended and supplemented by the Amended and Restated Trust Agreement dated as of April 1, 2001 (as so amended, the "Trust Agreement"), between the Depositor and the Owner Trustee, a summary of certain of the pertinent provisions of which is set forth below. Capitalized terms used herein and not otherwise defined have the meanings ascribed thereto in the Trust Agreement, the Sale and Servicing Agreement dated as of April 1, 2001 (the "Sale and Servicing Agreement"), among the Trust, the Depositor and TMCC, as servicer (the "Servicer") or the Indenture dated as of April 1, 2001 (the "Sale and Servicing Agreement"), among the Trust, the Depositor and TMCC, as the case may be. This Certificate is the duly authorized Certificate (the "Certificate") evidencing the nonassessable, fully-paid, fractional undivided interest in the Trust issued pursuant to the Trust Agreement. Certain debt instruments evidencing obligations of the Trust have been issued under an Indenture dated as of April 1, 2001, between the Trust and Wells Fargo Bank Minnesota, National Association, as indenture trustee (the "Indenture Trustee"), consisting of four classes of A-1 Notes designated as "4.300% Asset Backed Notes, Class A-1," "Floating Rate Asset Backed Notes, Class A-2," "Floating Rate Asset Backed Notes, Class A-3" and "Floating Rate Asset Backed Notes, Class A-4" (collectively, the "Notes"). This Certificate is issued under and is subject to the terms, provisions and conditions of the Trust Agreement. The holder of this Certificate, by virtue of its acceptance hereof, assents to and is bound by all of the provisions of the Trust Agreement. The property of the Trust includes a pool of retail installment sale contracts secured by new and used automobiles and light duty trucks (the "Receivables"), all monies due thereunder on or after April 1, 2001, in the case of Precomputed Receivables or received after such date in the case of Simple Interest Receivables, security interests in the vehicles financed thereby, certain bank accounts and the proceeds thereof, proceeds from claims on certain insurance policies and certain other rights under the Trust Agreement and the Sale and Servicing Agreement and all proceeds of the foregoing. It is the intent of the Depositor, TMCC and the Certificateholders that, for purposes of federal income tax, state and local income tax, any state single business tax and any other income taxes, the Trust will be treated as a division or branch of the Person holding the beneficial ownership interests in the Trust for any period during which the beneficial ownership interests in the Trust are held by one person, and will be treated as a partnership, and the Certificateholders will be treated as partners in that partnership, for any period during which the beneficial ownership interests in the Trust are held by more than one person. For any such period during which the beneficial ownership interests in the Trust are held by more than one person, each Certificateholder, by acceptance of a Certificate or any beneficial interest on a Certificate, agrees to treat, and to take no action inconsistent with the treatment of, the Certificates as partnership interests in the Trust for such tax purposes. Under the Trust Agreement, there will be distributed to the Holder hereof on the 15th day of each month or, if such 15th day is not a Business Day, the next Business Day, (each, a "Payment Date"), commencing on June 15, 2001, the amounts to be distributed to Certificateholder on such Payment Date in respect of amounts distributable to the Certificateholder pursuant to Section 5.06 of the Sale and Servicing Agreement. The holder of this Certificate acknowledges and agrees that its rights to receive distributions in respect of this Certificate are subordinated to the rights of the Noteholders as described in the Sale and Servicing Agreement and the Indenture. Distributions on this Certificate will be made as provided in the Trust Agreement by the Owner Trustee by wire transfer or check mailed to the Certificateholder without the presentation or surrender of this Certificate or the making of any notation hereon. Except as otherwise provided in the Trust Agreement and notwithstanding the above, the final distribution on this Certificate will be made after due notice by the Owner Trustee of the pendency of such distribution and only upon presentation and surrender of this Certificate at the office or agency maintained for the purpose by the Owner Trustee in Wilmington, Delaware or the Borough of Manhattan, The City of New York. A-2 Reference is hereby made to the further provisions of this Certificate set forth on the reverse hereof, which further provisions shall for all purposes have the same effect as if set forth at this place. Unless the certificate of authentication hereon shall have been executed by an authorized officer of the Owner Trustee, by manual signature, this Certificate shall not entitle the holder hereof to any benefit under the Trust Agreement or the Sale and Servicing Agreement or be valid for any purpose. THIS CERTIFICATE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF DELAWARE, WITHOUT REFERENCE TO ITS CONFLICT OF LAW PROVISIONS, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS. A-3 IN WITNESS WHEREOF, the Owner Trustee, on behalf of the Trust and not in its individual capacity, has caused this Certificate to be duly executed. Dated: April 1, 2001 TOYOTA AUTO RECEIVABLES 2001-B OWNER TRUST By: FIRST UNION TRUST COMPANY, NATIONAL ASSOCIATION, not in its individual capacity but solely an Owner Trustee By: ---------------------------------- Authorized Signatory A-4 OWNER TRUSTEE'S CERTIFICATE OF AUTHENTICATION This is the Certificate referred to in the within-mentioned Trust Agreement. FIRST UNION TRUST COMPANY, NATIONAL ASSOCIATION, not in its individual capacity but solely an Owner Trustee By: ---------------------------------- Authorized Signatory A-5 (REVERSE OF CERTIFICATE) The holder of this Certificate, by accepting an interest in this Certificate, acknowledges that this Certificate represents a beneficial interest in the Trust only and does not represent any interest in or obligation of the Depositor, TMCC (in any capacity), the Administrator, the Owner Trustee, the Indenture Trustee or any Affiliate thereof and no recourse may be had against such parties or their assets, except as may be expressly set forth or contemplated in this Certificate or the Basic Documents. In addition, this Certificate is not guaranteed by any governmental agency or instrumentality and is limited in right of payment to certain collections with respect to the Receivables (and certain other amounts), all as more specifically set forth herein and in the Sale and Servicing Agreement. A copy of each of the Sale and Servicing Agreement and the Trust Agreement may be examined during normal business hours at the principal office of the Depositor, and at such other places, if any, designated by the Depositor, by the Certificateholder upon written request. The Trust Agreement permits, with certain exceptions therein provided, the amendment thereof and the modification of the rights and obligations of the Depositor and the rights of the Certificateholder under the Trust Agreement at any time by (i) the Depositor and the Owner Trustee, with prior written notice to the Rating Agencies, without the consent of any of the Noteholders or the Certificateholder, to cure any ambiguity, to correct or supplement any provisions in this Agreement or for the purpose of adding any provisions to or changing in any manner or eliminating any of the provisions in this Agreement or of modifying in any manner the rights of the Noteholders or the Certificateholder, if (a) the Indenture Trustee and Owner Trustee receive an Opinion of Counsel to the effect that such action will not adversely affect in any material respect the interests of any Noteholder or the Certificateholder, or (b) the Indenture Trustee or Owner Trustee, as the case may be, have received the consent of (i) the Holders of at least 51% of the Outstanding Amount of the affected Class A Notes acting as a single Class (excluding for such purposes the outstanding principal amount of any Class A Notes held of record or beneficially owned by TMCC, TAFR LLC or any of their Affiliates) or (ii) after the Class A Notes have been paid in full, the Certificateholder, if affected, PROVIDED, HOWEVER, that no such amendment made pursuant to clause (b) above shall (i) increase or reduce in any manner the amount of, or accelerate or delay the timing of, collections of payments on Receivables or distributions that shall be required to be made for the benefit of the Noteholders or the Certificateholder or (ii) reduce the aforesaid percentage of the Outstanding Amount of the Notes required to consent to any such amendment, without the consent of the Holders of all the affected Notes and the Certificate. The Trust Agreement may also be amended from time to time by the Depositor, the Owner Trustee and the Indenture Trustee for purposes of changing the formula for determining the Specified Reserve Account Balance, the manner in which the Reserve Account is funded (i.e., to allow the deposit of cash therein by any Person, but not to change any order of priority of payments and distributions specified in Section 5.06 of the Sale and Servicing Agreement), changing the remittance schedule for the deposit of collections in the Collection Account or Payahead Account or changing the definition of Eligible Investments, if (a) the Owner Trustee and Indenture Trustee have received from each Rating Agency that has rated any outstanding Class of Notes of its written confirmation that such amendment will not result in the qualification, withdrawal or modification of the rating then assigned by such Rating Agency to A-6 any Class of Notes, without the consent of any of the Noteholders or the Certificateholder, or (b) the Indenture Trustee or Owner Trustee, as the case may be, have received the consent of (i) the Holders of at least 51% of the Outstanding Amount of the Class A Notes or (ii) after the Class A Notes have been paid in full, the Certificateholder; PROVIDED, HOWEVER, that no such amendment shall (a) increase or reduce in any manner the amount of, or accelerate or delay the timing of, collections of payments on Receivables or distributions that shall be required to be made for the benefit of the Noteholders or the Certificateholder or (b) reduce the aforesaid percentage of the Outstanding Amount of the Notes required to consent to any such amendment, without the consent of the Holders of all the affected Notes and the Certificate. The obligations and responsibilities created by the Trust Agreement and the Trust created thereby shall terminate upon the payment to the Certificateholder of all amounts required to be paid to it pursuant to the Trust Agreement and the Sale and Servicing Agreement and the disposition of all property held as part of the Owner Trust Estate. TMCC, as servicer of the Receivables under the Sale and Servicing Agreement, or any successor servicer, may at its option purchase the corpus of the Trust at a price specified in the Sale and Servicing Agreement, and any such purchase of the Receivables and other property of the Trust will effect early retirement of the Certificate; however, such right of purchase is exercisable only after the last day of the Collection Period as of which the Pool Balance is less than or equal to 10% of the Original Pool Balance. A-7 EX-4.5 6 a2049889zex-4_5.txt EXHIBIT 4.5 EXHIBIT 4.5 ADMINISTRATION AGREEMENT among TOYOTA AUTO RECEIVABLES 2001-B OWNER TRUST, as Issuer TOYOTA MOTOR CREDIT CORPORATION, as Administrator WELLS FARGO BANK MINNESOTA, NATIONAL ASSOCIATION, as Indenture Trustee and FIRST UNION TRUST COMPANY, NATIONAL ASSOCIATION, as Owner Trustee Dated as of April 1, 2001 TABLE OF CONTENTS
PAGE 1. Duties of the Administrator.............................................................................2 2. Records.................................................................................................8 3. Compensation............................................................................................8 4. Additional Information to be Furnished to the Issuer....................................................8 5. Independence of the Administrator.......................................................................9 6. No Joint Venture........................................................................................9 7. Other Activities of Administrator.......................................................................9 8. Term of Agreement; Resignation and Removal of Administrator.............................................9 9. Action upon Termination, Resignation or Removal........................................................10 10. Notices................................................................................................11 11. Amendments.............................................................................................11 12. Successor and Assigns..................................................................................11 13. Governing Law..........................................................................................12 14. Headings...............................................................................................12 15. Counterparts...........................................................................................12 16. Severability of Provisions.............................................................................12 17. Not Applicable to TMCC in Other Capacities.............................................................12 18. Limitation of Liability of Owner Trustee and Indenture Trustee.........................................12 19. Limitation on Liability of Administrator...............................................................12
-i- ADMINISTRATION AGREEMENT dated as of April 1, 2001, among TOYOTA AUTO RECEIVABLES 2001-B OWNER TRUST, a Delaware business trust (the "Issuer"), TOYOTA MOTOR CREDIT CORPORATION, a California corporation, as administrator (the "Administrator"), WELLS FARGO BANK MINNESOTA, NATIONAL ASSOCIATION, a national baking association, not in its individual capacity but solely as Indenture Trustee (the "Indenture Trustee") and FIRST UNION TRUST COMPANY, NATIONAL ASSOCIATION, a national banking association, not in its individual capacity but solely as Owner Trustee (the "Owner Trustee"). W I T N E S S E T H: WHEREAS a beneficial ownership interest in the Issuer represented by the Toyota Auto Receivables 2001-B Owner Trust Asset Backed Certificate (the "Certificate") has been issued in connection with the formation of the Issuer pursuant to the Amended and Restated Trust Agreement dated as of April 1, 2001 (the "Trust Agreement"), between Toyota Auto Finance Receivables LLC ("TAFR LLC"), a Delaware limited liability company, as depositor, and First Union Trust Company, National Association, as owner trustee (the "Owner Trustee"), to the owners thereof (the "Owners"); WHEREAS the Issuer is issuing the Toyota Auto Receivables 2001-B Owner Trust $417,840,000 [__%] Asset Backed Notes, Class A-1, the Toyota Auto Receivables 2001-B Owner Trust $500,000,000 Floating Rate Asset Backed Notes Class A-2, the Toyota Auto Receivables 2001-B Owner Trust $360,000,000 Floating Rate Asset Backed Notes, Class A-3 and the Toyota Auto Receivables 2001-B Owner Trust $175,000,000 Asset Backed Notes Class A-4 (collectively, the "Notes") pursuant to the Indenture dated as of April 1, 2001 (as amended and supplemented from time to time, the "Indenture"), between the Issuer and the Indenture Trustee (capitalized terms used herein and not defined herein shall have the meanings ascribed thereto in the Indenture, the Trust Agreement or the Sale and Servicing Agreement dated as of April 1, 2001, among the Issuer, Toyota Motor Credit Corporation ("TMCC"), as servicer, and TAFR LLC, as seller (the "Sale and Servicing Agreement"), as the case may be); WHEREAS, TMCC and TAFR LLC have entered into the Receivables Purchase Agreement, dated as of April 1, 2001 (the Receivables Purchase Agreement"), by and among TMCC, as seller, and TAFR LLC, as purchaser, WHEREAS the Issuer has entered into certain agreements in connection with the issuance of the Certificate and the Notes, including the Trust Agreement, the Indenture, the Administration Agreement and the Sale and Servicing Agreement (collectively, the "Basic Documents"); WHEREAS, pursuant to the Basic Documents, the Issuer, the Owner Trustee and the Indenture Trustee are required to perform certain duties in connection with the Certificate, the Notes and the Collateral; WHEREAS the Issuer, the Owner Trustee and the Indenture Trustee desire to appoint TMCC as administrator to perform certain of the duties of the Issuer, the Owner Trustee and the Indenture Trustee under the Basic Documents and to provide such additional services consistent with the terms of this Agreement and the Basic Documents as the Issuer and the Owner Trustee may from time to time request; and WHEREAS the Administrator has the capacity to provide the services required hereby and is willing to perform such services for the Issuer and the Owner Trustee on the terms set forth herein; NOW, THEREFORE, in consideration of the mutual covenants contained herein, and other good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, the parties agree as follows: 1. DUTIES OF THE ADMINISTRATOR. (a) Duties with respect to the Note Depository Agreement and the Indenture. (i) The Administrator agrees to perform all its duties as Administrator and the duties of the Issuer under the Note Depository Agreement. In addition, the Administrator shall consult with the Owner Trustee regarding the duties of the Issuer under the Indenture and the Note Depository Agreement. The Administrator shall monitor the performance of the Issuer and shall advise the Owner Trustee when action by the Issuer or the Owner Trustee is necessary to comply with the Issuer's duties under the Indenture and the Note Depository Agreement. The Administrator shall prepare for execution by the Issuer or shall cause the preparation by other appropriate persons of all such documents, reports, filings, instruments, certificates and opinions as it shall be the duty of the Issuer to prepare, file or deliver pursuant to the Indenture and the Depository Agreement. In furtherance of the foregoing, the Administrator shall take all appropriate action that is the duty of the Issuer to take pursuant to the Indenture including, without limitation, such of the foregoing as are required with respect to the following matters under the Indenture (references are to sections of the Indenture): (A) causing the Note Register to be kept and giving the Indenture Trustee notice of any appointment of a new Note Registrar and the location, or change in location, of the Note Register (Section 2.04); (B) preparing the notification to Noteholders of the final principal payment on their Notes (Section 2.07(b)); (C) fixing or causing to be fixed any specified record date and the notification of the Indenture Trustee and Noteholders with respect to special payment dates, if any (Section 5.04(d)); (D) preparing or obtaining the documents and instruments required for the proper authentication of Notes and delivering the same to the Indenture Trustee (Section 2.02); 2 (E) approving the form and substance of an Opinion of Counsel or a representation letter of the transferee in connection with the transfer of the Class A-1 Notes (Section 2.04(b)); (F) directing the Indenture Trustee to retain from amounts otherwise distributable to the Noteholders sufficient funds for the payment of any tax that is legally owed by the Trust (Section 2.07(c)); (G) preparing, obtaining and/or filing of all instruments, opinions and certificates and other documents required for the release of collateral (Section 2.09) ; (H) causing newly appointed Paying Agents, if any, to deliver to the Indenture Trustee the instrument specified in the Indenture regarding funds held in trust (Section 3.03); (I) directing the Indenture Trustee to deposit moneys with Paying Agents, if any, other than the Indenture Trustee (Section 3.03); (J) obtaining and preserving the Issuer's qualification to do business in each jurisdiction in which such qualification is or shall be necessary to protect the validity and enforceability of the Indenture, the Notes, the Collateral and each other instrument and agreement included in the Trust Estate (Section 3.04); (K) preparing all supplements, amendments, financing statements, continuation statements, instruments of further assurance and other instruments, in accordance with Section 3.05 of the Indenture, necessary to protect the Trust Estate (Section 3.05); (L) delivering the required Opinions of Counsel on the Closing Date and annually, in accordance with Section 3.06 of the Indenture, and delivering the annual Officers' Certificates and certain other statements as to compliance with the Indenture, in accordance with Section 3.09 of the Indenture (Sections 3.06 and 3.09); (M) identifying to the Indenture Trustee in an Officers' Certificate any Person with whom the Issuer has contracted to perform its duties under the Indenture (Section 3.07(b)); (N) notifying the Indenture Trustee and the Rating Agencies of any Servicer Default pursuant to the Sale and Servicing Agreement and, if such Servicer Default arises from the failure of the Servicer to perform any of its duties under the Sale and Servicing Agreement, taking all reasonable steps available to remedy such failure (Section 3.07(d)); 3 (O) preparing and obtaining documents and instruments required for the release of the Issuer from its obligations under the Indenture (Section 3.10(b)); (P) delivering notice to the Indenture Trustee of each Event of Default and each other default by the Servicer or the Seller under the Sale and Servicing Agreement (Section 3.19); (Q) monitoring the Issuer's obligations as to the satisfaction and discharge of the Indenture and the preparation of an Officer's Certificate and obtaining the Opinion of Counsel and the Independent Certificate (as defined in the Indenture) related thereto (Section 4.01); (R) complying with any written directive of the Indenture Trustee with respect to the provision of relevant information and reasonable assistance with respect to the execution, delivery, filing and recordation of relevant transfer documentation and the delivery of related records and files, in connection with any sale by the Indenture Trustee of any portion of the Trust Estate in connection with any Event of Default (Section 5.04); (S) preparing notice to Noteholders of any removal of the Indenture Trustee and the appointment of a successor Indenture Trustee for delivery to Noteholders by the successor Indenture Trustee (Section 6.08); (T) preparing all written instruments required to confirm the authority of any co-trustee or separate trustee and any written instruments necessary in connection with the resignation or removal of any co-trustee or separate trustee (Sections 6.08 and 6.10); (U) providing to the Rating Agencies copies of any amendment or supplement to the Interest Rate Swap Agreement (Section 6.14(c)); (V) notifying the Swap Counterparty of any proposed amendment or supplement to any of the Basic Documents (Section 6.14(d)); (W) causing the Note Registrar to furnish to the Indenture Trustee the names and addresses of Noteholders during any period when the Indenture Trustee is not the Note Registrar (Section 7.01); (X) preparing and, after execution by the Issuer and the Indenture Trustee, filing with the Commission and any applicable state agencies of documents required to be filed on a periodic basis with the Commission and any applicable state agencies (including any summaries thereof required by rules and regulations prescribed thereby), and providing such documents to the Indenture Trustee for delivery to the Noteholders (Section 7.03); 4 (Y) preparing and, after execution by the Indenture Trustee, providing to the Indenture Trustee for delivery to Noteholders and filing with the Commission, any reports required by TIA Sections 313(a), (b) and (c); provided, that the Administrator will not be required to prepare reports required by TIA Sections 313(a)(1) and (a)(2) unless specifically directed in writing to do so by the Indenture Trustee and the Indenture Trustee provides the Administrator with all information necessary to prepare such reports (Section 7.04); (Z) preparing the related Issuer Orders and all other actions necessary with respect to investment and reinvestment of funds in the Trust Accounts (Section 8.04); (AA) preparing any Issuer Request and Officers' Certificates and obtaining any Opinions of Counsel and Independent Certificates necessary for the release of the Trust Estate (Sections 8.05 and 8.06); (BB) preparing Issuer Orders and obtaining Opinions of Counsel with respect to the execution of any supplemental indentures, preparing notices to the Noteholders with respect thereto and furnishing such notices to the Indenture Trustee for delivery to Noteholders (Sections 9.01, 9.02 and 9.03); (CC) preparing new Notes conforming to the provisions of any supplemental indenture, as appropriate and delivering such Notes to the Indenture Trustee for execution and authentication (Section 9.07); (DD) preparing forms of notices to Noteholders of any redemption of the Notes and furnishing such notices to the Indenture Trustee for delivery to Noteholders (Section 10.02); (EE) preparing or obtaining all Officers' Certificates, Opinions of Counsel and Independent Certificates with respect to any requests by the Issuer or the Indenture Trustee to take any action under the Indenture (Section 11.01(a)); (FF) preparing and delivering Officers' Certificates and obtaining Independent Certificates, if necessary, for the release of property from the lien of the Indenture (Section 11.01(b)); (GG) notifying the Rating Agencies, upon any failure of the Indenture Trustee to give such notification, of the information required pursuant to Section 11.04 of the Indenture (Section 11.04); (HH) preparing and delivering to the Indenture Trustee for delivery to Noteholders any agreements with respect to alternate payment and notice provisions (Section 11.06); 5 (II) causing the recording of the Indenture, if applicable (Section 11.14); and (ii) The Administrator also will: (A) pay the Indenture Trustee from time to time the reasonable compensation provided for in the Indenture with respect to services rendered by the Indenture Trustee under the Indenture (which compensation shall not be limited by any provision of law in regard to the compensation of a Trustee of an express trust); (B) reimburse the Indenture Trustee upon its request for all reasonable expenses, disbursements and advances incurred or made by the Indenture Trustee in accordance with any provision of the Indenture (including the reasonable compensation, expenses and disbursements of its agents and counsel) to the extent the Indenture Trustee is entitled to such reimbursement by the Issuer under the Indenture; (C) indemnify the Indenture Trustee for, and hold it harmless against, any losses, liability or expense incurred without negligence or bad faith on the part of the Indenture Trustee, arising out of or in connection with the acceptance or administration of the trusts and duties contemplated by the Indenture, including the reasonable costs and expenses of defending itself against any claim or liability in connection therewith, to the extent the Indenture Trustee is entitled to such indemnification from the Issuer under the Indenture; and (D) indemnify the Owner Trustee for, and hold it harmless against, any loss, liability or expense incurred without negligence or bad faith on the part of the Owner Trustee, arising out of or in connection with the acceptance or administration of the transactions contemplated by the Trust Agreement, the Indenture, the Note Depository Agreement or this Administration Agreement, including the reasonable costs and expenses of defending itself against any claim or liability in connection with the exercise or performance of any of their powers or duties under the Trust Agreement to the extent the Owner Trustee is entitled to such indemnification under Section 8.02 of the Trust Agreement. (b) Additional Duties. (i) In addition to the duties of the Administrator set forth above, the Administrator shall perform such calculations, and shall prepare for execution by the Issuer or the Owner Trustee or shall cause the preparation by other appropriate persons of all such documents, reports, filings, instruments, certificates and opinions as it shall be the duty of the Issuer or the Owner Trustee to prepare, file or deliver pursuant to the Basic Documents, and at the request of the Owner Trustee shall take all appropriate action with respect thereto, other than delivery thereof to Noteholders or the Certificateholder, that is the duty of the Issuer or the Owner Trustee to take pursuant to 6 the Basic Documents. Subject to Section 5 of this Agreement, and in accordance with the reasonable written directions of the Owner Trustee, the Administrator shall administer, perform or supervise the performance of such other activities in connection with the Collateral (including the Basic Documents) as are not covered by any of the foregoing provisions and as are expressly requested by the Owner Trustee and are reasonably within the capability of the Administrator. Such responsibilities shall include, and the Owner Trustee hereby requests the Administrator, obtain and maintain any licenses required to be obtained or maintained by the Trust under the Pennsylvania Motor Vehicle Sales Finance Act or the Maryland Sales Finance Company licensing regulations. In addition, the Administrator shall promptly notify the Indenture Trustee and the Owner Trustee in writing of any amendment to the Pennsylvania Motor Vehicle Sales Finance Act or Maryland Sales Finance Company licensing regulations that would affect the duties or obligations of the Indenture Trustee, or the Owner Trustee under any Basic Document and shall assist the Indenture Trustee or the Owner Trustee in obtaining and maintaining any licenses required to be obtained or maintained by the Indenture Trustee or the Owner Trustee thereunder. In connection therewith, the Administrator shall pay all fees and expenses of obtaining and maintaining any such licenses under such Act and Code. (ii) Notwithstanding anything in this Agreement or the Basic Documents to the contrary, the Administrator shall be responsible for promptly notifying the Owner Trustee in the event that any withholding tax is imposed on the Issuer's payments (or allocations of income) to the Certificateholder as contemplated in Section 5.02(c) of the Trust Agreement. Any such notice shall specify the amount of any withholding tax required to be withheld by the Owner Trustee pursuant to such provision. (iii) Notwithstanding anything in this Agreement or the Basic Documents to the contrary, the Administrator shall be responsible for performance of the duties of the Owner Trustee set forth in Sections 5.04(a), (b), (c) and (d) of the Trust Agreement with respect to, among other things, accounting and reports to the Certificateholder. (iv) The Administrator shall perform the duties of the Administrator specified in Section 10.02 of the Trust Agreement required to be performed in connection with the resignation or removal of the Owner Trustee, and any other duties expressly required to be performed by the Administrator under the Trust Agreement. (v) In carrying out the foregoing duties or any of its other obligations under this Agreement, the Administrator may enter into transactions with or otherwise deal with any of its Affiliates; provided, however, that the terms of any such transactions or dealings shall be in accordance with any directions received from the Issuer and shall be, in the Administrator's opinion, no less favorable to the Issuer than would be available from unaffiliated parties. 7 (c) Non-Ministerial Matters. (i) With respect to matters that in the reasonable judgment of the Administrator are non-ministerial, the Administrator shall not take any action unless within a reasonable time before the taking of such action the Administrator shall have notified the Indenture Trustee or the Owner Trustee, as applicable, of the proposed action and the Indenture Trustee or the Owner Trustee, as applicable, shall not have withheld consent or provided an alternative direction. For the purpose of the preceding sentence, "non-ministerial matters" shall include, without limitation: (A) the amendment of the Indenture or execution of any supplement to the Indenture; (B) the initiation of any claim or lawsuit by the Issuer and the compromise of any action, claim or lawsuit brought by or against the Issuer (other than in connection with the collection of the Receivables); (C) the amendment, change or modification of any of the asic Documents; (D) the appointment of successor Note Registrars, successor Paying Agents or successor Indenture Trustees pursuant to the Indenture or the appointment of successor Administrators or Successor Servicers, or the consent to the assignment by the Note Registrar, Paying Agent or Indenture Trustee of its obligations, under the Indenture; and (E) the removal of the Indenture Trustee (as to which the Owner Trustee, but not the Indenture Trustee, will receive notice and opportunity to object). (ii) Notwithstanding anything to the contrary in this Agreement, the Administrator shall not be obligated to, and shall not, (x) make any payments to the Noteholders under the Basic Documents, (y) sell the Trust Estate pursuant to Section 5.04 of the Indenture or (z) take any other action that the Issuer directs the Administrator not to take on its behalf. 2. RECORDS. The Administrator shall maintain appropriate books of account and records relating to services performed hereunder, which books of account and records shall be accessible for inspection by the Issuer, the Owner Trustee and the Indenture Trustee at any time during normal business hours upon reasonable advance written notice. 3. COMPENSATION. As compensation for the performance of the Administrator's obligations under this Agreement and as reimbursement for its expenses related thereto, the Administrator shall be entitled to a fee of $200.00 per month which shall be solely an obligation of the Servicer. 8 4. ADDITIONAL INFORMATION TO BE FURNISHED TO THE ISSUER. The Administrator shall furnish to the Issuer from time to time such additional information regarding the Collateral as the Issuer shall reasonably request. 5. INDEPENDENCE OF THE ADMINISTRATOR. For all purposes of this Agreement, the Administrator shall be an independent contractor and shall not be subject to the supervision of the Issuer, the Owner Trustee or the Indenture Trustee with respect to the manner in which it accomplishes the performance of its obligations hereunder. Unless expressly authorized by the Issuer hereunder or otherwise, the Administrator shall have no authority to act for or represent the Issuer, the Owner Trustee or the Indenture Trustee, and shall not otherwise be or be deemed an agent of the Issuer, the Owner Trustee or the Indenture Trustee. 6. NO JOINT VENTURE. Nothing contained in this Agreement shall (i) constitute the Administrator and any of the Issuer, the Owner Trustee or the Indenture Trustee as members of any partnership, joint venture, association, syndicate, unincorporated business or other separate entity, (ii) be construed to impose any liability as such on any of them or (iii) be deemed to confer on any of them any express, implied or apparent authority to incur any obligation or liability on behalf of the others. 7. OTHER ACTIVITIES OF ADMINISTRATOR. Nothing herein shall prevent the Administrator or its Affiliates from engaging in other businesses or, in its or their sole discretion, from acting as an administrator for any other person or entity, or in a similar capacity therefor, even though such person or entity may engage in business activities similar to those of the Issuer, the Owner Trustee or the Indenture Trustee. 8. TERM OF AGREEMENT; RESIGNATION AND REMOVAL OF ADMINISTRATOR. (a) This Agreement shall continue in force until the dissolution of the Issuer, upon which event this Agreement shall automatically terminate. (b) Subject to Sections 8(e) and 8(f), the Administrator may resign its duties hereunder by providing the Issuer with at least 30 days, prior written notice. (c) Subject to Sections 8(e) and 8(f), the Issuer may remove the Administrator without cause by providing the Administrator with at least 30 days prior written notice. (d) Subject to Sections 8(e) and 8(f), at the sole option of the Issuer, the Administrator may be removed immediately upon written notice of termination from the Issuer to the Administrator if any of the following events shall occur: (i) the Administrator shall fail to perform in any material respect any of its duties under this Agreement and, after notice of such default, shall not cure such default within 10 days (or, if such default cannot be cured in such time, shall not give within such 10 days such assurance of timely and complete cure as shall be reasonably satisfactory to the Issuer); 9 (ii) the entry of a decree or order by a court or agency or supervisory authority having jurisdiction in the premises for the appointment of a trustee in bankruptcy, conservator, receiver or liquidator for the Administrator (or, so long as the Administrator is TMCC, the Seller) in any bankruptcy, insolvency, readjustment of debt, marshalling of assets and liabilities or similar proceedings, or for the winding up or liquidation of their respective affairs, and the continuance of any such decree or order unstayed and in effect for a period of 90 consecutive days; or (iii) the consent by the Administrator (or, so long as the Administrator is TMCC, the Seller) to the appointment of a trustee in bankruptcy, conservator or receiver or liquidator in any bankruptcy, insolvency, readjustment of debt, marshalling of assets and liabilities or similar proceedings of or relating to the Administrator (or, so long as the Administrator is TMCC, the Seller) of or relating to substantially all of their property, or the Administrator (or, so long as the Administrator is TMCC, the Seller) shall admit in writing its inability to pay its debts generally as they become due, file a petition to take advantage of any applicable insolvency or reorganization statute, make an assignment for the benefit of its creditors, or voluntarily suspend payment of its obligations. The Administrator agrees that if any of the events specified in clauses (ii) or (iii) of this Section shall occur, it shall give written notice thereof to the Issuer, the Owner Trustee and the Indenture Trustee within seven days after the happening of such event. (e) No resignation or removal of the Administrator pursuant to this Section shall be effective until (i) a successor Administrator shall have been appointed by the Issuer and (ii) such successor Administrator shall have agreed in writing to be bound by the terms of this Agreement in the same manner as the Administrator is bound hereunder. (f) The appointment of any successor Administrator shall be effective only after each Rating Agency has provided to the Owner Trustee and the Indenture Trustee written notice that the proposed appointment will not result in the reduction or withdrawal of any rating then assigned by such Rating Agency to any Class of Notes. (g) Subject to Section 8(e) and 8(f), the Administrator acknowledges that upon the appointment of a Successor Servicer pursuant to the Sale and Servicing Agreement, the Administrator shall immediately resign and such Successor Servicer shall automatically succeed to the rights, duties and obligations of the Administrator under this Agreement. 9. ACTION UPON TERMINATION, RESIGNATION OR REMOVAL. Promptly upon the effective date of termination of this Agreement pursuant to Section 8(a) or the resignation or removal of the Administrator pursuant to Section 8(b), (c), (d) or (g), respectively, the Administrator shall be entitled to be paid all fees and reimbursable expenses accruing to it to the date of such termination, resignation or removal. The Administrator shall forthwith upon such termination pursuant to Section 8(a) deliver to or to the order of the Issuer all property and documents of or relating to the Collateral then in the custody of the Administrator. In the event of the resignation 10 or removal of the Administrator pursuant to Section 8(b), (c), (d) or (g), respectively, the Administrator shall cooperate with the Issuer and take all reasonable steps requested to assist the Issuer in making an orderly transfer of the duties of the Administrator. 10. NOTICES. Any notice, report or other communication given hereunder shall be in writing and addressed as follows: (a) if to the Issuer or the Owner Trustee, to: Toyota Auto Receivables 2001-B Owner Trust In care of: First Union Trust Company, National Association One Rodney Square 920 King Street, Suite 102 Wilmington, Delaware 19801 Attention: Toyota Auto Receivables 2001-B Owner Trust (b) if to the Administrator, to: Toyota Motor Credit Corporation 19001 South Western Avenue Torrance, California 90509 Attention: Treasury Department, Vice President, Treasury (c) if to the Indenture Trustee, to: Wells Fargo Bank Minnesota, National Association Sixth and Marquette MAC: N9311-161 Minneapolis, Minnesota 55479 Attention: Toyota Auto Receivables 2001-B Owner Trust or to such other address as any party shall have provided to the other parties in writing. Any notice required to be in writing hereunder shall be deemed given if such notice is mailed by certified mail, postage prepaid, or hand delivered to the address of such party as provided above. 11. AMENDMENTS. This Agreement may be amended from time to time by a written amendment duly executed and delivered by the Issuer, the Administrator, the Owner Trustee and the Indenture Trustee, without the consent of any Noteholders or the Certificateholders, for the purpose of adding any provisions to or modifying or changing in any manner or eliminating any of the provisions of this Agreement; provided that such amendment does not and will not, in the Opinion of Counsel satisfactory to the Indenture Trustee, materially and adversely affect the interest of any Noteholder or Certificateholder. 12. SUCCESSOR AND ASSIGNS. This Agreement may not be assigned by the Administrator unless such assignment is consented to in writing by the Issuer, the Owner Trustee and the Indenture Trustee, and the conditions precedent to appointment of a successor 11 Administrator set forth in Section 8 are satisfied. An assignment with such consent and satisfaction, if accepted by the assignee, shall bind the assignee hereunder in the same manner as the Administrator is bound hereunder. Notwithstanding the foregoing, this Agreement may be assigned by the Administrator without the consent of the Issuer, the Owner Trustee and the Indenture Trustee to a corporation or other organization that is a successor (by merger, consolidation or purchase of assets) to the Administrator, provided that such successor organization executes and delivers to the Issuer, the Owner Trustee and the Indenture Trustee an agreement in which such corporation or other organization agrees to be bound hereunder by the terms of said assignment in the same manner as the Administrator is bound hereunder. Subject to the foregoing, this Agreement shall bind any successors or assigns of the parties hereto. 13. GOVERNING LAW. This Agreement shall be governed by and construed in accordance with the laws of the State of California, without reference to its conflict of law provisions, and the obligations, rights and remedies of the parties hereunder shall be determined in accordance with such laws. 14. HEADINGS. The section headings hereof have been inserted for convenience of reference only and shall not be construed to affect the meaning, construction or effect of this Agreement. 15. COUNTERPARTS. This Agreement may be executed in counterparts, each of which when so executed shall together constitute but one and the same agreement. 16. SEVERABILITY OF PROVISIONS. If any one or more of the agreements, provisions or terms of this Agreement shall be for any reason whatsoever held invalid or unenforceable in any jurisdiction, then such agreements, provisions or terms shall be deemed severable from the remaining covenants, agreements, provisions or terms of this Agreement and shall in no way affect the validity or enforceability of the other provisions of this Agreement or the other rights of the parties hereto. 17. NOT APPLICABLE TO TMCC IN OTHER CAPACITIES. Nothing in this Agreement shall affect any obligation, right or benefit TMCC may have in any other capacity or under any Basic Document. 18. LIMITATION OF LIABILITY OF OWNER TRUSTEE AND INDENTURE TRUSTEE. Notwithstanding anything contained herein to the contrary, this instrument has been countersigned by First Union Trust Company, National Association, not in its individual capacity but solely in its capacity as Owner Trustee of the Issuer, and by Wells Fargo Bank Minnesota, National Association, not in its individual capacity but solely in its capacity as Indenture Trustee under the Indenture. In no event shall First Union Trust Company, National Association, in its individual capacity, Wells Fargo Bank Minnesota, National Association, in its individual capacity, or the Certificateholder have any liability for the representations, warranties, covenants, agreements or other obligations of the Issuer hereunder or in any of the certificates, notices or agreements delivered pursuant hereto, as to all of which recourse shall be had solely to the assets of the Issuer. 12 19. LIMITATION ON LIABILITY OF ADMINISTRATOR. Neither the Administrator nor any of the directors, officers, employees or agents of the Administrator shall be under any liability to the Seller, the Issuer, the Owner Trustee, the Indenture Trustee, the Noteholders or the Certificateholder, except as provided under this Administration Agreement, for any action taken or for refraining from the taking of any action pursuant to this Administration Agreement or for errors in judgment; provided, however, that this provision shall not protect the Administrator or any such person against any liability that would otherwise be imposed by reason of willful misfeasance, bad faith or negligence in the performance of duties or by reason of reckless disregard of obligations and duties under this Administration Agreement. The Administrator and any director, officer, employee or agent of the Administrator may rely in good faith on any document of any kind prima facie properly executed and submitted by any person respecting any matters arising under this Administration Agreement. 13 IN WITNESS WHEREOF, the parties have caused this Agreement to be duly executed and delivered as of the day and year first above written. TOYOTA AUTO RECEIVABLES 2001-B OWNER TRUST By: FIRST UNION TRUST COMPANY, NATIONAL ASSOCIATION not in its individual capacity but solely as Owner Trustee By: /s/ Sterling C. Correia -------------------------------------- Name: Sterling C. Correia Title: Vice President TOYOTA MOTOR CREDIT CORPORATION, as Administrator By: /s/ George E. Borst -------------------------------------- Name: George E. Borst Title: President and Chief Executive Officer WELLS FARGO BANK MINNESOTA, NATIONAL ASSOCIATION not in its individual capacity but solely as Indenture Trustee By: /s/ Marianna Stershic -------------------------------------- Name: Marianna C. Stershic Title: Vice President FIRST UNION TRUST COMPANY, NATIONAL ASSOCIATION not in its individual capacity but solely as Owner Trustee By: /s/ Sterling C. Correia -------------------------------------- Name: Sterling C. Correia Title: Vice President S-1 EX-4.6 7 a2049889zex-4_6.txt EXHIBIT 4.6 EXHIBIT 4.6 (MULTICURRENCY - CROSS BORDER) ISDA(R) International Swap Dealers Association, Inc. MASTER AGREEMENT dated as of........................... ..................................... and ...................................... have entered and/or anticipate entering into one or more transactions (each a "Transaction") that are or will be governed by this Master Agreement, which includes the schedule (the "Schedule"), and the documents and other confirming evidence (each a "Confirmation") exchanged between the parties confirming those Transactions. Accordingly, the parties agree as follows:- 1. INTERPRETATION (a) DEFINITIONS. The terms defined in Section 14 and in the Schedule will have the meanings therein specified for the purpose of this Master Agreement. (b) INCONSISTENCY. In the event of any inconsistency between the provisions of the Schedule and the other provisions of this Master Agreement, the Schedule will prevail. In the event of any inconsistency between the provisions of any Confirmation and this Master Agreement (including the Schedule), such Confirmation will prevail for the purpose of the relevant Transaction. (c) SINGLE AGREEMENT. All Transactions are entered into in reliance on the fact that this Master Agreement and all Confirmations form a single agreement between the parties (collectively referred to as this "Agreement"), and the parties would not otherwise enter into any Transactions. 2. OBLIGATIONS. (a) GENERAL CONDITIONS. (i) Each party will make each payment or delivery specified in each Confirmation to be made by it, subject to the other provisions of this Agreement. (ii) Payments under this Agreement will be made on the due date for value on that date in the place of the account specified in the relevant Confirmation or otherwise pursuant to this Agreement, in freely transferable funds and in the manner customary for payments in the required currency. Where settlement is by delivery (that is, other than by payment), such delivery will be made for receipt on the due date in the manner customary for the relevant obligation unless otherwise specified in the relevant Confirmation or elsewhere in this Agreement. (iii) Each obligation of each party under Section 2(a)(i) is subject to (1) the condition precedent that no Event of Default or Potential Event of Default with respect to the other party has occurred and is continuing, (2) the condition precedent that no Early Termination Date in respect of the relevant Transaction has occurred or been effectively designated and (3) each other applicable condition precedent specified in this Agreement. (b) CHANGE OF ACCOUNT. Either party may change its account for receiving a payment or delivery by giving notice to the other party at least five Local Business Days prior to the scheduled date for the payment or delivery to which such change applies unless such other party gives timely notice of a reasonable objection to such change. (c) NETTING. If on any date amounts would otherwise be payable:- (i) in the same currency; and (ii) in respect of the same Transaction, by each party to the other, then, on such date, each party's obligation to make payment of any such amount will be automatically satisfied and discharged and, if the aggregate amount that would otherwise have been payable by one party exceeds the aggregate amount that would otherwise have been payable by the other party, replaced by an obligation upon the party by whom the larger aggregate amount would have been payable to pay to the other party the excess of the larger aggregate amount over the smaller aggregate amount. The parties may elect in respect of two or more Transactions that a net amount will be determined in respect of all amounts payable on the same date in the same currency in respect of such Transactions, regardless of whether such amounts are payable in respect of the same Transaction. The election may be made in the Schedule or a Confirmation by specifying that subparagraph (ii) above will not apply to the Transactions identified as being subject to the election, together with the starting date (in which case subparagraph (ii) above will not, or will cease to, apply to such Transactions from such date). This election may be made separately for different groups of Transactions and will apply separately to each pairing of Offices through which the parties make and receive payments or deliveries. (d) DEDUCTION OR WITHHOLDING FOR TAX. (i) GROSS-UP. All payments under this Agreement will be made without any deduction or withholding for or on account of any Tax unless such deduction or withholding is required by any applicable law, as modified by the practice of any relevant governmental revenue authority, then in effect. If a party is so required to deduct or withhold, then that party ("X") will:- (1) promptly notify the other party ("Y") of such requirement; (2) pay to the relevant authorities the full amount required to be deducted or withheld (including the full amount required to be deducted or withheld from any additional amount paid by X to Y under this Section 2(d)) promptly upon the earlier of determining that such deduction or withholding is required or receiving notice that such amount has been assessed against Y; (3) promptly forward to Y an official receipt (or a certified copy), or other documentation reasonably acceptable to Y, evidencing such payment to such authorities; and (4) if such Tax is an Indemnifiable Tax, pay to Y, in addition to the payment to which Y is otherwise entitled under this Agreement, such additional amount as is necessary to ensure that the net amount actually received by Y (free and clear of Indemnifiable Taxes, whether assessed against X or Y) will equal the full amount Y would have received had no such deduction or withholding been required. However, X will not be required to pay any additional amount to Y to the extent that it would not be required to be paid but for:- (A) the failure by Y to comply with or perform any agreement contained in Section 4(a)(i), 4(a)(iii) or 4(d); or (B) the failure of a representation made by Y pursuant to Section 3(f) to be accurate and true unless such failure would not have occurred but for (I) any action taken by a taxing authority, or brought in a court of competent jurisdiction, on or after the date on which a Transaction is entered into (regardless of whether such action is taken or brought with respect to a party to this Agreement) or (II) a Change in Tax Law. 2 (ii) LIABILITY. If:-- (1) X is required by any applicable law, as modified by the practice of any relevant governmental revenue authority, to make any deduction or withholding in respect of which X would not be required to pay an additional amount to Y under Section 2(d)(i)(4); (2) X does not so deduct or withhold; and (3) a liability resulting from such Tax is assessed directly against X. then, except to the extent Y has satisfied or then satisfies the liability resulting from such Tax, Y will promptly pay to X the amount of such liability (including any related liability for interest, but including any related liability for penalties only if Y has failed to comply with or perform any agreement contained in Section 4(a)(i), 4(a)(iii) or 4(d)). (c) DEFAULT INTEREST; OTHER AMOUNTS. Prior to the occurrence or effective designation of an Early Termination Date in respect of the relevant Transaction, a party that defaults in the performance of any payment obligation will, to the extent permitted by law and subject to Section 6(c), be required to pay interest (before as well as after judgment) on the overdue amount to the other party on demand in the same currency as such overdue amount, for the period from (and including) the original due date for payment to (but excluding) the date of actual payment, at the Default Rate. Such interest will be calculated on the basis of daily compounding and the actual number of days elapsed. If, prior to the occurrence or effective designation of an Early Termination Date in respect of the relevant Transaction, a party defaults in the performance of any obligation required to be settled by delivery, it will compensate the other party on demand if and to the extent provided for in the relevant Confirmation or elsewhere in this Agreement. 3. REPRESENTATIONS Each party represents to the other party (which representations will be deemed to be repeated by each party on each date on which a Transaction is entered into and, in the case of the representations in Section 3(f), at all times until the termination of this Agreement) that:-- (a) BASIC REPRESENTATIONS. (i) STATUS. It is duly organised and validly existing under the laws of the jurisdiction of its organisation or incorporation and, if relevant under such laws, in good standing; (ii) POWERS. It has the power to execute this Agreement and any other documentation relating to this Agreement to which it is a party, to deliver this Agreement and any other documentation relating to this Agreement that it is required by this Agreement to deliver and to perform its obligations under this Agreement and any obligations it has under any Credit Support Document to which it is a party and has taken all necessary action to authorise such execution, delivery and performance; (iii) NO VIOLATION OR CONFLICT. Such execution, delivery and performance do not violate or conflict with any law applicable to it, any provision of its constitutional documents, any order or judgment of any court or other agency of governmental applicable to it or any of its assets or any contractual restriction binding on or affecting it or any of its assets; (iv) CONSENTS. All governmental and other consents that are required to have been obtained by it with respect to this Agreement or any Credit Support Document to which it is a party have been obtained and are in full force and effect and all conditions of any such consents have been complied with; and (v) OBLIGATIONS BINDING. Its obligations under this Agreement and any Credit Support Document to which it is a party constitute its legal, valid and binding obligations, enforceable in accordance with their respective terms (subject to applicable bankruptcy, reorganisation, insolvency, moratorium or similar laws affecting creditors' rights generally and subject, as to enforceability, to equitable principles of general application (regardless of whether enforcement is sought in a proceeding in equity or at law)). 3 (b) ABSENCE OF CERTAIN EVENTS. No Event of Default or Potential Event of Default or, to its knowledge, Termination Event with respect to it has occurred and is continuing and no such event or circumstance would occur as a result of its entering into or performing its obligations under this Agreement or any Credit Support Document to which it is a party. (c) ABSENCE OF LITIGATION. There is not pending or, to its knowledge, threatened against it or any of its Affiliates any action, suit or proceeding at law or in equity or before any town, tribunal, governmental body, agency or official or any arbitrator that is likely to affect the legality, validity or enforceability against it of this Agreement or any Credit Support Document to which it is a party or its ability to perform its obligations under this Agreement or such Credit Support Document. (d) ACCURACY OF SPECIFIED INFORMATION. All applicable information that is furnished in writing by or on behalf of it to the other party and is identified for the purpose of this Section 3(d) in the Schedule is, as of the date of the information, true, accurate and complete in every material respect. (e) PAYER TAX REPRESENTATION. Each representation specified in the Schedule as being made by it for the purpose of this Section 3(e) is accurate and true. (f) PAYEE TAX REPRESENTATIONS. Each representation specified in the Schedule as being made by it for the purpose of this Section 3(f) is accurate and true. 4. AGREEMENTS Each party agrees with the other that, so long as either party has or may have any obligation under this Agreement or under any Credit Support Document to which it is a party:-- (a) FURNISH SPECIFIED INFORMATION. It will deliver to the other party or, in certain cases under subparagraph (iii) below, to such government or taxing authority as the other party reasonably directs:-- (i) any forms, documents or certificates relating to taxation specified in the Schedule or any Confirmation; (ii) any other documents specified in the Schedule or any Confirmation; and (iii) upon reasonable demand by such other party, any form or document that may be required or reasonably requested in writing in order to allow such other party or its Credit Support Provider to make a payment under this Agreement or any applicable Credit Support Document without any deduction or withholding for or on account of any Tax or with such deduction or withholding at a reduced rate (so long as the completion, execution or submission of such form or document would not materially prejudice the legal or commercial position of the party in receipt of such demand), with any such form or document to be accurate and completed in a manner reasonably satisfactory to such other party and to be executed and to be delivered with any reasonably required certification. in each case by the date specified in the Schedule or such Confirmation or, if none is specified, as soon as reasonably practicable. (b) MAINTAIN AUTHORIZATIONS. It will use all reasonable efforts to maintain in full force and effect all consents of any governmental or other authority that are required to be obtained by it with respect to this Agreement or any Credit Support Document to which it is a party and will use all reasonable efforts to obtain any that may become necessary in the future. (c) COMPLY WITH LAWS. It will comply in all material respects with all applicable laws and orders to which it may be subject if failure so to comply would materially impair its ability to perform its obligations under this Agreement or any Credit Support Document to which it is a party. (d) TAX AGREEMENT. It will give notice of any failure of a representation made by it under Section 3(f) to be accurate and true promptly upon learning of such failure. (e) PAYMENT OF STAMP TAX. Subject to Section 11, it will pay any Stamp Tax levied or imposed upon it or in respect of its execution or performance of this Agreement by a jurisdiction in which it is incorporated. 4 organised, managed and controlled, or considered to have its seat, or in which a branch or office through which it is acting for the purpose of this Agreement is located ("Stamp Tax Jurisdiction") and will indemnify the other party against any Stamp Tax levied or imposed upon the other party or in respect of the other party's execution or performance of this Agreement by any such Stamp Tax Jurisdiction which is not also a Stamp Tax Jurisdiction with respect to the other party. 5. EVENTS OF DEFAULT AND TERMINATION EVENTS (a) EVENTS OF DEFAULT. The occurrence at any time with respect to a party or, if applicable, any Credit Support Provider of such party or any Specified Entity of such party of any of the following events constitutes an event of default (an "Event of Default") with respect to such party:-- (i) FAILURE TO PAY OR DELIVER. Failure by the party to make, when due, any payment under this Agreement or delivery under Section 2(a)(i) or 2(e) required to be made by it if such failure is not remedied on or before the third Local Business Day after notice of such failure is given to the party; (ii) BREACH OF AGREEMENT. Failure by the party to comply with or perform any agreement or obligation (other than an obligation to make any payment under this Agreement or delivery under Section 2(a)(i) or 2(e) or to give notice of a Termination Event or any agreement or obligation under Section 4(a)(i), 4(a)(iii) or 4(d)) to be complied with or performed by the party in accordance with this Agreement if such failure is not remedied on or before the thirtieth day after notice of such failure is given to the party; (iii) CREDIT SUPPORT DEFAULT. (1) Failure by the party or any Credit Support Provider of such party to comply with or perform any agreement or obligation to be complied with or performed by it in accordance with any Credit Support Document if such failure is continuing after any applicable grace period has elapsed; (2) the expiration or termination of such Credit Support Document or the failing or ceasing of such Credit Support Document to be in full force and effect for the purpose of this Agreement (in either case other than in accordance with its terms) prior to the satisfaction of all obligations of such party under each Transaction to which such Credit Support Document relates without the written consent of the other party; or (3) the party or such Credit Support Provider disaffirms, disclaims, repudiates or rejects, in whole or in part, or challenges the validity of such Credit Support Document; (iv) MISREPRESENTATION. A representation (other than a representation under Section 3(e) or (f)) made or repeated or deemed to have been made or repeated by the party or any Credit Support Provider of such party in this Agreement or any Credit Support Document proves to have been incorrect or misleading in any material respect when made or repeated or deemed to have been made or repeated; (v) DEFAULT UNDER SPECIFIED TRANSACTION. The party, any Credit Support Provider of such party or any applicable Specified Entity of such party (1) defaults under a Specified Transaction and, after giving effect to any applicable notice requirement or grace period, there occurs a liquidation of, an acceleration of obligations under, or an early termination of, that Specified Transaction, (2) defaults, after giving effect to any applicable notice requirement or grace period, in making any payment or delivery due on the last payment, delivery or exchange date of, or any payment on early termination, of a Specified Transaction (or such default continues for at least three Local Business Days if there is no applicable notice requirement or grace period) or (3) disaffirms, disclaims, repudiates or rejects, in whole or in part, a Specified Transaction for such action is taken by any person or entity appointed or empowered to operate it or act on its behalf); (vi) CROSS DEFAULT. If "Cross Default" is specified in the Schedule as applying to the party, the occurrence or existence of (1) a default, event of default or other similar condition or event (however 5 described) in respect of such party, any Credit Support Provider of such party or any applicable Specified Entity of such party under one or more agreements or instruments relating to Specified Indebtedness of any of them (individually or collectively) in an aggregate amount of not less than the applicable Threshold Amount (as specified in the Schedule) which has resulted in such Specified Indebtedness becoming, or becoming capable at such time of being declared, due and payable under such agreements or instruments, before it would otherwise have been due and payable or (2) a default by such party, such Credit Support Provider or such Specified Entity (individually or collectively) in making one or more payments on the due date thereof in an aggregate amount of not less than the applicable Threshold Amount under such agreements or instruments (after giving effect to any applicable notice requirement or grace period); (vii) BANKRUPTCY. The party, any Credit Support Provider of such party or any applicable Specified Entity of such party:-- (1) is dissolved (other than pursuant to a consolidation, amalgamation or merger); (2) becomes insolvent or is unable to pay its debts or fails or admits in writing its inability generally to pay its debts as they become due; (3) makes a general assignment, arrangement or composition with or for the benefit of its creditors; (4) institutes or has instituted against it a proceeding seeking a judgment of insolvency or bankruptcy or any other relief under any bankruptcy or insolvency law or other similar law affecting creditors' rights, or a petition is presented for its winding-up or liquidation, and, in the case of any such proceeding or petition instituted or presented against it, such proceeding or petition (A) results in a judgment of insolvency or bankruptcy or the envy of an order for relief or the making of an order for its winding-up or liquidation or (B) is not dismissed, discharged, stayed or restrained in each case within 30 days of the institution or presentation thereof; (5) has a resolution passed for its winding-up, official management or liquidation (other than pursuant to a consolidation, amalgamation or merger); (6) seeks or becomes subject to the appointment of an administrator, provisional liquidator, conservator, receiver, trustee, custodian or other similar official for it or for all or substantially all its assets; (7) has a secured party take possession of all or substantially all its assets or has a distress, execution, attachment, sequestration or other legal process levied, enforced or sued on or against all or substantially all its assets and such secured party maintains possession, or any such process is not dismissed, discharged, stayed or restrained, in each case within 30 days thereafter; (8) causes or is subject to any event with respect to it which, under the applicable laws of any jurisdiction, has an analogous effect to any of the events specified in clauses (1) to (7) (inclusive); or (9) takes any action in furtherance of, or indicating its consent to, approval of, or acquiescence, in any of the foregoing acts; or (viii) MERGER WITHOUT ASSUMPTION. The party or any Credit Support Provider of such party consolidates or amalgamates with, or merges with or into, or transfers all or substantially all its assets to, another entity, and, at the time of such consolidation, amalgamation, merger or transfer:-- (1) the resulting, surviving or transferee entity fails to assume all the obligations of such party or such Credit Support Provider under this Agreement or any Credit Support Document to which it or its predecessor was a party by operation of law or pursuant to an agreement reasonably satisfactory to the other party to this Agreement; or (2) the benefits of any Credit Support Document fail to extend (without the consent of the other party) to the performance by such resulting, surviving or transferee entity of its obligations under this Agreement. (b) TERMINATION EVENTS. The occurrence at any time with respect to a party or, if applicable, any Credit Support Provider of such party or any Specified Entity of such party of any event specified below constitutes an Illegality if the event is specified in (i) below, a Tax Event if the event is specified in (ii) below or a Tax Event Upon Merger if the event is specified in (iii) below, and, if specified to be applicable, a Credit Event 6 Upon Merger if the event is specified pursuant to (iv) below or an Additional Termination Event if the event is specified pursuant to (v) below:-- (i) ILLEGALITY. Due to the adoption of, or any change in, any applicable law after the date on which a Transaction is entered into, or due to the promulgation of, or any change in, the interpretation by any court, tribunal or regulatory authority with competent jurisdiction of any applicable law after such date, it becomes unlawful (other than as a result of a breach by the party of Section 4(b)) for such party (which will be the Affected Party):-- (1) to perform any absolute or contingent obligation to make a payment or delivery or to receive a payment or delivery in respect of such Transaction or to comply with any other material provision of this Agreement relating to such Transaction; or (2) to perform, or for any Credit Support Provider of such party to perform, any contingent or other obligation which the party (or such Credit Support Provider) has under any Credit Support Document relating to such Transaction; (ii) TAX EVENT. Due to (x) any action taken by a taxing authority, or brought in a court of competent jurisdiction, on or after the date on which a Transaction is entered into (regardless of whether such action is taken or brought with respect to a party to this Agreement) or (y) a Change in Tax Law, the party (which will be the Affected Party) will, or there is a substantial likelihood that it will, on the next succeeding Scheduled Payment Date (1) be required to pay to the other party an additional amount in respect of an Indemnifiable Tax under Section 2(d)(i)(4) (except in respect of interest under Section 2(e), 6(d)(ii) or 6(e)) or (2) receive a payment from which an amount is required to be deducted or withheld for or on account of a Tax (except in respect of interest under Section 2(e), 6(d)(ii) or 6(e)) and no additional amount is required to be paid in respect of such Tax under Section 2(d)(i)(4) (other than by reason of Section 2(d)(i)(4)(A) or (B)); (iii) TAX EVENT UPON MERGER. The party (the "Burdened Party") on the next succeeding Scheduled Payment Date will either (1) be required to pay an additional amount in respect of an Indemnifiable Tax under Section 2(d)(i)(4) (except in respect of interest under Section 2(e), 6(d)(ii) or 6(e)) or (2) receive a payment from which an amount has been deducted or withheld for or on account of any Indemnifiable Tax in respect of which the other party is not required to pay an additional amount (other than by reason of Section 2(d)(i)(4)(A) or (B)), in either case as a result of a party consolidating or amalgamating with, or merging with or into, or transferring all or substantially all its assets to, another entity (which will be the Affected Party) where such action does not constitute an event described in Section 5(a)(viii); (iv) CREDIT EVENT UPON MERGER. If "Credit Event Upon Merger" is specified in the Schedule as applying to the party, such party ("X"), any Credit Support Provider of X or any applicable Specified Entity of X consolidates or amalgamates with, or merges with or into, or transfers all or substantially all its assets to, another entity and such action does not constitute an event described in Section 5(a)(viii) but the creditworthiness of the resulting, surviving or transferee entity is materially weaker than that of X, such Credit Support Provider or such Specified Entity, as the case may be, immediately prior to such action (and, in such event, X or its successor or transferee, as appropriate, will be the Affected Party); or (v) ADDITIONAL TERMINATION EVENT. If any "Additional Termination Event" is specified in the Schedule or any Confirmation as applying, the occurrence of such event (and, in such event, the Affected Party or Affected Parties shall be as specified for such Additional Termination Event in the Schedule or such Confirmation). (c) EVENT OF DEFAULT AND ILLEGALITY. If an event or circumstance which would otherwise constitute or give rise to an Event of Default also constitutes an illegality, it will be treated as an Illegality and will not constitute an Event of Default. 7 6. EARLY TERMINATION (a) RIGHT TO TERMINATE FOLLOWING EVENT OF DEFAULT. If at any time an Event of Default with respect to a party (the "Defaulting Party") has occurred and is then continuing, the other party (the "Non-defaulting Party") may, by not more than 20 days notice to the Defaulting Party specifying the relevant Event of Default, designate a day not earlier than the day such notice is effective as an Early Termination Date in respect of all outstanding Transactions. If, however, "Automatic Early Termination" is specified in the Schedule as applying to a party, then an Early Termination Date in respect of all outstanding Transactions will occur immediately upon the occurrence with respect to such party of an Event of Default specified in Section 5(a)(vii)(1), (3), (5), (6) or, to the extent analogous thereto, (8), and as of the time immediately preceding the institution of the relevant proceeding or the presentation of the relevant petition upon the occurrence with respect to such party of an Event of Default specified in Section 5(a)(vii)(4) or, to the extent analogous thereto. (8) (b) RIGHT TO TERMINATE FOLLOWING TERMINATION EVENT. (i) NOTICE. If a Termination Event occurs, an Affected Party will, promptly upon becoming aware of it, notify the other party, specifying the nature of that Termination Event and each Affected Transaction and will also give such other information about that Termination Event as the other party may reasonably require. (ii) TRANSFER TO AVOID TERMINATION EVENT. If either an Illegality under Section 5(b)(i)(1) or a Tax Event occurs and there is only one Affected Party; or if a Tax Event Upon Merger occurs and the Burdened Party is the Affected Party, the Affected Party will, as a condition to its right to designate an Early Termination Date under Section 6(b)(iv), use all reasonable efforts (which will not require such party to incur a loss, excluding immaterial, incidental expenses) to transfer within 20 days after it gives notice under Section 6(b)(i) all its rights and obligations under this Agreement in respect of the Affected Transactions to another of its Offices or Affiliates so that such Termination Event ceases to exist. If the Affected Party is not able to make such a transfer it will give notice to the other party to that effect within such 20 day period, whereupon the other party may effect such a transfer within 30 days after the notice is given under Section 6(b)(i). Any such transfer by a party under this Section 6(b)(ii) will be subject to and conditional upon the prior written consent of the other party, which consent will not be withheld if such other party's policies in effect at such time would permit it to enter into transactions with the transferee on the terms proposed. (iii) TWO AFFECTED PARTIES. If an illegality under Section 5(b)(i)(1) or a Tax Event occurs and there are two Affected Parties, each party will use all reasonable efforts to reach agreement within 30 days after notice thereof is given under Section 6(b)(i) on action to avoid that Termination Event. (iv) RIGHT TO TERMINATE. If:-- (1) a transfer under Section 6(b)(ii) or an agreement under Section 6(b)(iii), as the case may be, has not been effected with respect to all Affected Transactions within 30 days after an Affected Party gives notice under Section 6(b)(i); or (2) an Illegality under Section 5(b)(i)(2), a Credit Event Upon Merger or an Additional Termination Event occurs, or a Tax Event Upon Merger occurs and the Burdened Party is not the Affected Party. either party in the case of an Illegality, the Burdened Party in the case of a Tax Event Upon Merger, any Affected Party in the case of a Tax Event or an Additional Termination Event if there is more than one Affected Party, or the party which is not the Affected Party in the case of a Credit Event Upon Merger or an Additional Termination Event if there is only one Affected Party may, by not more than 20 days notice to the other party and provided that the relevant Termination Event is then 8 continuing, designate a day not earlier than the day such notice is effective as an Early Termination Date in respect of all Affected Transactions. (c) EFFECT OF DESIGNATION. (i) If notice designating an Early Termination Date is given under Section 6(a) or (b), the Early Termination Date will occur on the date so designated, whether or not the relevant Event of Default or Termination Event is then continuing. (ii) Upon the occurrence or effective designation of an Early Termination Date, no further payments or deliveries under Section 2(a)(i) or 2(c) in respect of the Terminated Transactions will be required to be made, but without prejudice to the other provisions of this Agreement. The amount, if any, payable in respect of an Early Termination Date shall be determined pursuant to Section 6(e). (d) CALCULATIONS. (i) STATEMENT. On or as soon as reasonably practicable following the occurrence of an Early Termination Date, each party will make the calculations on its part, if any, contemplated by Section 6(e) and will provide to the other party a statement (1) showing, in reasonable detail, such calculations (including all relevant quotations and specifying any amount payable under Section 6(e)) and (2) giving details of the relevant account to which any amount payable to it is to be paid. In the absence of written confirmation from the source of a quotation obtained in determining a Market Quotation, the records of the party obtaining such quotation will be conclusive evidence of the existence and accuracy of such quotation. (ii) PAYMENT DATE. An amount calculated as being due in respect of any Early Termination Date under Section 6(c) will be payable on the day that notice of the amount payable is effective (in the case of an Early Termination Date which is designated or occurs as a result of an Event of Default) and on the day which is two Local Business Days after the day on which notice of the amount payable is effective (in the case of an Early Termination Date which is designated as a result of a Termination Event). Such amount will be paid together with (to the extent permitted under applicable law) interest thereon (before as well as after judgment) in the Termination Currency, from (and including) the relevant Early Termination Date to (but excluding) the date such amount is paid, at the Applicable Rate. Such interest will be calculated on the basis of daily compounding and the actual number of days elapsed. (e) PAYMENTS ON EARLY TERMINATION. If an Early Termination Date occurs, the following provisions shall apply based on the parties' election in the Schedule of a payment measure, either "Market Quotation" or "Loss", and a payment method, either the "First Method" or the "Second Method". If the parties fail to designate a payment measure or payment method in the Schedule, it will be deemed that "Market Quotation" or the "Second Method", as the case may be, shall apply. The amount, if any, payable in respect of an Early Termination Date and determined pursuant to this Section will be subject to any Set-off. (i) EVENTS OF DEFAULT. If the Early Termination Date results from an Event of Default:-- (1) FIRST METHOD AND MARKET QUOTATION. If the First Method and Market Quotation apply, the Defaulting Party will pay to the Non- defaulting Party the excess, if a positive number, of (A) the sum of the Settlement Amount (determined by the Non-defaulting Party) in respect of the Terminated Transactions and the Termination Currency Equivalent of the Unpaid Amounts owing to the Non-defaulting Party over (B) the Termination Currency Equivalent of the Unpaid Amounts owing to the Defaulting Party. (2) FIRST METHOD AND LOSS. If the First Method and Loss apply, the Defaulting Party will pay to the Non-defaulting Party, if a positive number, the Non-defaulting Party's Loss in respect of this Agreement. (3) SECOND METHOD AND MARKET QUOTATION. If the Second Method and Market Quotation apply, an amount will be payable equal to (A) the sum of the Settlement Amount (determined by the 9 Non-defaulting Party) in respect of the Terminated Transactions and the Termination Currency Equivalent of the Unpaid Amounts owing to the Non-defaulting Party less (B) the Termination Currency Equivalent of the Unpaid Amounts owing to the Defaulting Party. If that amount is a positive number, the Defaulting Party will pay it to the Non-defaulting Party; if it is a negative number, the Non-defaulting Party will pay the absolute value of that amount to the Defaulting Party. (d) SECOND METHOD AND LOSS. If the Second Method and Loss apply, an amount will be payable equal to the Non-defaulting Party's Loss in respect of this Agreement. If that amount is a positive number, the Defaulting Party will pay it to the Non-defaulting Party; if it is a negative number, the Non-defaulting Party will pay the absolute value of that amount to the Defaulting Party. (ii) TERMINATION EVENTS. If the Early Termination Date results from a Termination Event:-- (1) ONE AFFECTED PARTY. If there is one Affected Party, the amount payable will be determined in accordance with Section 6(e)(i)(3), if Market Quotation applies, or Section 6(e)(i)(4), if Loss applies, except that, in either case, references to the Defaulting Party and to the Non-defaulting Party will be deemed to be references to the Affected Party and the party which is not the Affected Party, respectively, and if Loss applies and fewer than all the Transactions are being terminated, Loss shall be calculated in respect of all Terminated Transactions. (2) TWO AFFECTED PARTIES. If there are two Affected Parties:-- (A) if Market Quotation applies, each party will determine a Settlement Amount in respect of the Terminated Transactions, and an amount will be payable equal to (I) the sum of (a) one- half of the difference between the Settlement Amount of the party with the higher Settlement Amount ("X") and the Settlement Amount of the party with the lower Settlement Amount ("Y") and (b) the Termination Currency Equivalent of the Unpaid Amounts owing to X less (II) the Termination Currency Equivalent of the Unpaid Amounts owing to Y; and (B) if Loss applies, each party will determine its Loss in respect of this Agreement (or, if fewer than all the Transactions are being terminated, in respect of all Terminated Transactions) and an amount will be payable equal to one-half of the difference between the Loss of the party with the higher Loss ("X") and the Loss of the party with the lower Loss ("Y"). If the amount payable is a positive number, Y will pay it to X: if it is a negative number, X will pay the absolute value of that amount to Y. (iii) ADJUSTMENT FOR BANKRUPTCY. In circumstances where an Early Termination Date occurs because "Automatic Early Termination" applies in respect of a party, the amount determined under this Section 6(e) will be subject to such adjustments as are appropriate and permitted by law to reflect any payments or deliveries made by one party to the other under this Agreement (and retained by such other party) during the period from the relevant Early Termination Date to the date for payment determined under Section 6(d)(ii). (iv) PRE-ESTIMATE. The parties agree that if Market Quotation applies an amount recoverable under this Section 6(e) is a reasonable pre-estimate of loss and not a penalty. Such amount is payable for the loss of bargain and the loss of protection against future risks and except as otherwise provided in this Agreement neither party will be entitled to recover any additional damages as a consequence of such losses. 10 7. TRANSFER Subject to Section 6(b)(ii), neither this Agreement nor any interest or obligation in or under this Agreement may be transferred (whether by way of security or otherwise) by either party without the prior written consent of the other party, except that:-- (a) a party may make such a transfer of this Agreement pursuant to a consolidation or amalgamation with, or merger with or into, or transfer of all or substantially all its assets to, another entity (but without prejudice to any other right or remedy under this Agreement); and (b) a party may make such a transfer of all or any part of its interest in any amount payable to it from a Defaulting Party under Section 6(e). Any purported transfer that is not in compliance with this Section will be void. 8. CONTRACTUAL CURRENCY (a) PAYMENT IN THE CONTRACTUAL CURRENCY. Each payment under this Agreement will be made in the relevant currency specified in this Agreement for that payment (the "Contractual Currency"). To the extent permitted by applicable law, any obligation to make payments under this Agreement in the Contractual Currency will not be discharged or satisfied by any tender in any currency other than the Contractual Currency, except to the extent such tender results in actual receipt by the party to which payment is owed, acting in a reasonable manner and in good faith in converting the currency so tendered into the Contractual Currency, of the full amount in the Contractual Currency of all amounts payable in respect of this Agreement. If for any reason the amount in the Contractual Currency so received falls short of the amount in the Contractual Currency payable in respect of this Agreement, the party required to make the payment will, to the extent permitted by applicable law, immediately pay such additional amount in the Contractual Currency as may be necessary to compensate for the shortfall. If for any reason the amount in the Contractual Currency so received exceeds the amount in the Contractual Currency payable in respect of this Agreement, the party receiving the payment will refund promptly the amount of such excess. (b) JUDGMENTS. To the extent permitted by applicable law, if any judgment or order expressed in a currency other than the Contractual Currency is rendered (i) for the payment of any amount owing in respect of this Agreement, (ii) for the payment of any amount relating to any early termination in respect of this Agreement or (iii) in respect of a judgment or order of another court for the payment of any amount described in (i) or (ii) above, the party seeking recovery, after recovery in full of the aggregate amount to which such party is entitled pursuant to the judgment or order, will be entitled to receive immediately from the other party the amount of any shortfall of the Contractual Currency received by such party as a consequence of sums paid in such other currency and will refund promptly to the other party any excess of the Contractual Currency received by such party as a consequence of sums paid in such other currency if such shortfall or such excess arises or results from any variation between the rate of exchange at which the Contractual Currency is converted into the currency of the judgment or order for the purposes of such judgment or order and the rate of exchange at which such party is able, acting in a reasonable manner and in good faith in converting the currency received into the Contractual Currency, to purchase the Contractual Currency with the amount of the currency of the judgment or order actually received by such party. The term "rate of exchange" includes, without limitation, any premiums and costs of exchange payable in connection with the purchase of or conversion into the Contractual Currency. (c) SEPARATE INDEMNITIES. To the extent permitted by applicable law, these indemnities constitute separate and independent obligations from the other obligations in this Agreement, will be enforceable as separate and independent causes of action, will apply notwithstanding any indulgence granted by the party to which any payment is owed and will not be affected by judgment being obtained or claim or proof being made for any other sums payable in respect of this Agreement. (d) EVIDENCE OF LOSS. For the purpose of this Section 8, it will be sufficient for a party to demonstrate that it would have suffered a loss had an actual exchange or purchase been made. 11 9. MISCELLANEOUS (a) ENTIRE AGREEMENT. This Agreement constitutes the entire agreement and understanding of the parties with respect to its subject matter and supersedes all oral communication and prior writings with respect thereto. (b) AMENDMENTS. No amendment, modification or waiver in respect of this Agreement will be effective unless in writing (including a writing evidenced by a facsimile transmission) and executed by each of the parties or confirmed by an exchange of telexes or electronic messages on an electronic messaging system. (c) SURVIVAL OF OBLIGATIONS. Without prejudice to Sections 2(a)(iii) and 6(c)(ii), the obligations of the parties under this Agreement will survive the termination of any Transaction. (d) REMEDIES CUMULATIVE. Except as provided in this Agreement, the rights, powers, remedies and privileges provided in this Agreement are cumulative and not exclusive of any rights, powers, remedies and privileges provided by law. (e) COUNTERPARTS AND CONFIRMATIONS. (i) This Agreement (and each amendment, modification and waiver in respect of it) may be executed and delivered in counterparts (including by facsimile transmission), each of which will be deemed an original (ii) The parties intend that they are legally bound by the terms of each Transaction from the moment they agree to those terms (whether orally or otherwise). A Confirmation shall be entered into as soon as practicable and may be executed and delivered in counterparts (including by facsimile transmission) or be created by an exchange of telexes or by an exchange of electronic messages on an electronic messaging system, which in each case will be sufficient for all purposes to evidence a binding supplement to this Agreement. The parties will specify therein or through another effective means that any such counterpart, telex or electronic message constitutes a Confirmation. (f) NO WAIVER OF RIGHTS. A failure or delay in exercising any right, power or privilege in respect of this Agreement will not be presumed to operate as a waiver, and a single or partial exercise of any right, power or privilege will not be presumed to preclude any subsequent or further exercise, of that right, power or privilege or the exercise of any other right, power or privilege. (g) HEADINGS. The headings used in this Agreement are for convenience of reference only and are not to affect the construction of or to be taken into consideration in interpreting this Agreement. 10. OFFICES: MULTIBRANCH PARTIES (a) If Section 10(a) is specified in the Schedule as applying, each party that enters into a Transaction through an Office other than its head or home office represents to the other party that, notwithstanding the place of booking office or jurisdiction of incorporation or organisation of such party, the obligations of such party are the same as if it had entered into the Transaction through its head or home office. This representation will be deemed to be repeated by such party on each date on which a Transaction is entered into. (b) Neither party may change the Office through which it makes and receives payments or deliveries for the purpose of a Transaction without the prior written consent of the other party. (c) If a party is specified as a Multibranch Party in the Schedule, such Multibranch Party may make and receive payments or deliveries under any Transaction through any Office listed in the Schedule, and the Office through which it makes and receives payments or deliveries with respect to a Transaction will be specified in the relevant Confirmation. 11. EXPENSES A Defaulting Party will, on demand, indemnify and hold harmless the other party for and against all reasonable out-of-pocket expenses, including legal fees and Stamp Tax, incurred by such other party by reason of the enforcement and protection of its rights under this Agreement or any Credit Support Document 12 to which the Defaulting Party is a party or by reason of the early termination of any Transaction, including, but not limited to, costs of collection. 12. NOTICES (a) EFFECTIVENESS. Any notice or other communication in respect of this Agreement may be given in any manner set forth below (except that a notice or other communication under Section 5 or 6 may not be given by facsimile transmission or electronic messaging system) to the address or number or in accordance with the electronic messaging system details provided (see the Schedule) and will be deemed effective as indicated:-- (i) if in writing and delivered in person or by courier, on the date it is delivered; (ii) if sent by telex, on the date the recipient's answerback is received; (iii) if sent by facsimile transmission, on the date that transmission is received by a responsible employee of the recipient in legible form (it being agreed that the burden of proving receipt will be on the sender and will not be met by a transmission report generated by the sender's facsimile machine); (iv) if sent by certified or registered mail (airmail, if overseas) or the equivalent (return receipt requested), on the date that mail is delivered or its delivery is attempted; or (v) if sent by electronic messaging system, on the date that electronic message is received. unless the date of that delivery (or attempted delivery) or that receipt, as applicable, is not a Local Business Day or that communication is delivered (or attempted) or received, as applicable, after the close of business on a Local Business Day, in which case that communication shall be deemed given and effective on the first following day that is a Local Business Day. (b) CHANGE OF ADDRESSES. Either party may by notice to the other change the address, telex or facsimile number or electronic messaging system details at which notices or other communications are to be given to it. 13. GOVERNING LAW AND JURISDICTION (a) GOVERNING LAW. This Agreement will be governed by and construed in accordance with the law specified in the Schedule. (b) JURISDICTION. With respect to any suit, action or proceedings relating to this Agreement ("Proceedings"), each party irrevocably:-- (i) submits to the jurisdiction of the English courts, if this Agreement is expressed to be governed by English law, or to the non-exclusive jurisdiction of the courts of the State of New York and the United States District Court located in the Borough of Manhattan in New York City, if this Agreement is expressed to be governed by the laws of the State of New York; and (ii) waives any objection which it may have at any time to the laying of venue of any Proceedings brought in any such court, waives any claim that such Proceedings have been brought in an inconvenient forum and further waives the right to object, with respect to such Proceedings, that such court does not have any jurisdiction over such party. Nothing in this Agreement precludes either party from bringing Proceedings in any other jurisdiction (outside, if this Agreement is expressed to be governed by English law, the Contracting States, as defined in Section 1(3) of the Civil Jurisdiction and Judgments Act 1982 or any modification, extension or re-enactment thereof for the time being in force) nor will the bringing of Proceedings in any one or more jurisdictions preclude the bringing of Proceedings in any other jurisdiction. (c) SERVICE OF PROCESS. Each party irrevocably appoints the Process Agent (if any) specified opposite its name in the Schedule to receive, for it and on its behalf, service of process in any Proceedings. If for any 13 reason any party's Process Agent is unable to act as such, such party will promptly notify the other party and within 30 days appoint a substitute process agent acceptable to the other party. The parties irrevocably consent to service of process given in the manner provided for notices in Section 12. Nothing in this Agreement will affect the right of either party to serve process in any other manner permitted by law. (d) WAIVER OF IMMUNITIES. Each party irrevocably waives, to the fullest extent permitted by applicable law, with respect to itself and its revenues and assets (irrespective of their use or intended use), all immunity on the grounds of sovereignty or other similar grounds from (i) suit, (ii) jurisdiction of any court, (iii) relief by way of injunction, order for specific performance or for recovery of property, (iv) attachment of its assets (whether before or after judgment) and (v) execution or enforcement of any judgment to which it or its revenues or assets might otherwise be entitled in any Proceedings in the courts of any jurisdiction and irrevocably agrees, to the extent permitted by applicable law, that it will not claim any such immunity in any Proceedings. 14. DEFINITIONS As used in this Agreement:-- "ADDITIONAL TERMINATION EVENT" has the meaning specified in Section 5(b). "AFFECTED PARTY" has the meaning specified in Section 5(b). "AFFECTED TRANSACTIONS" means (a) with respect to any Termination Event consisting of an Illegality, Tax Event or Tax Event Upon Merger, all Transactions affected by the occurrence of such Termination Event and (b) with respect to any other Termination Event, all Transactions. "AFFILIATE" means, subject to the Schedule, in relation to any person, any entity controlled, directly or indirectly, by the person, any entity that controls, directly or indirectly, the person or any entity directly or indirectly under common control with the person. For this purpose, "control" of any entity or person means ownership of a majority of the voting power of the entity or person. "APPLICABLE RATE" means:-- (a) in respect of obligations payable or deliverable (or which would have been but for Section 2(a)(iii)) by a Defaulting Party, the Default Rate; (b) in respect of an obligation to pay an amount under Section 6(e) of either party from and after the date (determined in accordance with Section 6(d)(ii)) on which that amount is payable, the Default Rate; (c) in respect of all other obligations payable or deliverable (or which would have been but for Section 2(a)(iii)) by a Non-defaulting Party, the Non-default Rate; and (d) in all other cases, the Termination Rate. "BURDENED PARTY" has the meaning specified in Section 5(b). "CHANGE IN TAX LAW" means the enactment, promulgation, execution or ratification of, or any change in or amendment to, any law (or in the application or official interpretation of any law) that occurs on or after the date on which the relevant Transaction is entered into. "CONSENT" includes a consent, approval, action, authorisation, exemption, notice, filing, registration or exchange control consent. "CREDIT EVENT UPON MERGER" has the meaning specified in Section 5(b). "CREDIT SUPPORT DOCUMENT" means any agreement or instrument that is specified as such in this Agreement. "CREDIT SUPPORT PROVIDER" has the meaning specified in the Schedule. "DEFAULT RATE" means a rate per annum equal to the cost (without proof or evidence of any actual cost) to the relevant payee (as certified by it) if it were to fund or of funding the relevant amount plus 1% per annum. 14 "DEFAULTING PARTY" has the meaning specified in Section 6(a). "EARLY TERMINATION DATE" means the date determined in accordance with Section 6(a) or 6(b)(iv). "EVENT OF DEFAULT" has the meaning specified in Section 5(a) and, if applicable, in the Schedule. "ILLEGALITY" has the meaning specified in Section 5(b). "INDEMNIFIABLE TAX" means any Tax other than a Tax that would not be imposed in respect of a payment under this Agreement but for a present or former connection between the jurisdiction of the government or taxation authority imposing such Tax and the recipient of such payment or a person related to such recipient (including, without limitation, a connection arising from such recipient or related person being or having been a citizen or resident of such jurisdiction, or being or having been organised, present or engaged in a trade or business in such jurisdiction, or having or having had a permanent establishment or fixed place of business in such jurisdiction, but excluding a connection arising solely from such recipient or related person having executed, delivered, performed its obligations or received a payment under, or enforced, this Agreement or a Credit Support Document). "LAW" includes any treaty, law, rule or regulation (as modified, in the case of tax matters, by the practice of any relevant governmental revenue authority) and "LAWFUL" and "UNLAWFUL" will be construed accordingly. "LOCAL BUSINESS DAY" means, subject to the Schedule, a day on which commercial banks are open for business (including dealings in foreign exchange and foreign currency deposits) (a) in relation to any obligation under Section 2(a)(i), in the place(s) specified in the relevant Confirmation or, if not so specified, as otherwise agreed by the parties in writing or determined pursuant to provisions contained, or incorporated by reference, in this Agreement, (b) in relation to any other payment, in the place where the relevant account is located and, if different, in the principal financial centre, if any, of the currency of such payment, (c) in relation to any notice or other communication, including notice contemplated under Section 5(a)(i), in the city specified in the address for notice provided by the recipient and, in the case of a notice contemplated by Section 2(b), in the place where the relevant new account is to be located and (d) in relation to Section 5(a)(v)(2), in the relevant locations for performance with respect to such Specified Transaction. "LOSS" means, with respect to this Agreement or one or more Terminated Transactions, as the case may be, and a party, the Termination Currency Equivalent of an amount that party reasonably determines in good faith to be its total losses and costs (or gain, in which case expressed as a negative number) in connection with this Agreement or that Terminated Transaction or group of Terminated Transactions, as the case may be, including any loss of bargain, cost of funding or, at the election of such party but without duplication, loss or cost incurred as a result of its terminating, liquidating, obtaining or reestablishing any hedge or related trading position (or any gain resulting from any of them). Loss includes losses and costs (or gains) in respect of any payment or delivery required to have been made (assuming satisfaction of each applicable condition precedent) on or before the relevant Early Termination Date and not made, except, so as to avoid duplication, if Section 6(e)(i)(1) or (3) or 6(e)(ii)(2)(A) applies. Loss does not include a party's legal fees and out-of-pocket expenses referred to under Section 11. A party will determine its Loss as of the relevant Early Termination Date or, if that is not reasonably practicable, as of the earliest date thereafter as is reasonably practicable. A party may (but need not) determine its Loss by reference to quotations of relevant rates or prices from one or more leading dealers in the relevant markets. "MARKET QUOTATION" means, with respect to one or more Terminated Transactions and a party making the determination, an amount determined on the basis of quotations from Reference Market-makers. Each quotation will be for an amount, if any, that would be paid to such party (expressed as a negative number) or by such party (expressed as a positive number) in consideration of an agreement between such party (taking into account any existing Credit Support Document with respect to the obligations of such party) and the quoting Reference Market-maker to enter into a transaction (the "Replacement Transaction") that would have the effect of preserving for such party the economic equivalent of any payment or delivery (whether the underlying obligation was absolute or contingent and assuming the satisfaction of each applicable condition precedent) by the parties under Section (2)(a)(i) in respect of such Terminated Transaction or group of Terminated Transactions that would, but for the occurrence of the relevant Early Termination Date, have 15 been required after that date. For this purpose, Unpaid Amounts in respect of the Terminated Transaction or group of Terminated Transactions are to be excluded but, without limitation, any payment or delivery that would, but for the relevant Early Termination Date, have been required (assuming satisfaction of each applicable condition precedent) after that Early Termination Date is to be included. The Replacement Transaction would be subject to such documentation as such party and the Reference Market-maker may, in good faith, agree. The party making the determination (or its agent) will request each Reference Market-maker to provide its quotation to the extent reasonably practicable as of the same day and time (without regard to different time zones) on or as soon as reasonably practicable after the relevant Early Termination Date. The day and time as of which those quotations are to be obtained will be selected in good faith by the party obliged to make a determination under Section 6(c), and, if each party is so obliged, after consultation with the other. If more than three quotations are provided, the Market Quotation will be the arithmetic mean of the quotations without regard to the quotations having the highest and lowest values. If exactly three such quotations are provided, the Market Quotation will be the quotation remaining after disregarding the highest and lowest quotations. For this purpose, if more than one quotation has the same highest value or lowest value, then one of such quotations shall be disregarded. If fewer than three quotations are provided, it will be deemed that the Market Quotation in respect of such Terminated Transaction or group of Terminated Transactions cannot be determined. "NON-DEFAULT RATE" means a rate per annum equal to the cost (without proof or evidence of any actual cost) to the Non-defaulting Party (as certified by it) if it were to fund the relevant amount. "NON-DEFAULTING PARTY" has the meaning specified in Section 6(a). "OFFICE" means a branch or office of a party, which may be such party's head or home office. "POTENTIAL EVENT OF DEFAULT" means any event which, with the giving of notice or the lapse of time or both would constitute an Event of Default. "REFERENCE MARKET-MAKERS" means four leading dealers in the relevant market selected by the party determining a Market Quotation in good faith (a) from among dealers of the highest credit standing which satisfy all the criteria that such party applies generally at the time in deciding whether to offer or to make an extension of credit and (b) to the extent practicable, from among such dealers having an office in the same city. "RELEVANT JURISDICTION" means, with respect to a party, the jurisdictions (a) in which the party is incorporated, organised, managed and controlled or considered to have its seat, (b) where an Office through which the party is acting for purposes of this Agreement is located, (c) in which the party executes this Agreement and (d) in relation to any payment, from or through which such payment is made. "SCHEDULED PAYMENT DATE" means a date on which a payment or delivery is to be made under Section 2(a)(i) with respect to a Transaction. "SET-OFF" means set-off, offset, combination of accounts, right of retention or withholding or similar right or requirement to which the payer of an amount under Section 6 is entitled or subject (whether arising under this Agreement, another contract, applicable law or otherwise) that is exercised by, or imposed on, such payer. "SETTLEMENT AMOUNT" means, with respect to a party and any Early Termination Date, the sum of:-- (a) the Termination Currency Equivalent of the Market Quotations (whether positive or negative) for each Terminated Transaction or group of Terminated Transactions for which a Market Quotation is determined; and (b) such party's Loss (whether positive or negative and without reference to any Unpaid Amounts) for each Terminated Transaction or group of Terminated Transactions for which a Market Quotation cannot be determined or would not (in the reasonable belief of the party making the determination) produce a commercially reasonable result. "SPECIFIED ENTITY" has the meaning specified in the Schedule. 16 "SPECIFIED INDEBTEDNESS" means, subject to the Schedule, any obligation (whether present or future, contingent or otherwise, as principal or surety or otherwise) in respect of borrowed money. "SPECIFIED TRANSACTION" means, subject to the Schedule, (a) any transaction (including an agreement with respect thereto) now existing or hereafter entered into between one party to this Agreement (or any Credit Support Provider of such party or any applicable Specified Entity of such party) and the other party to this Agreement (or any Credit Support Provider of such other party or any applicable Specified Entity of such other party) which is a rate swap transaction, basis swap, forward rate transaction, commodity swap, commodity option, equity or equity index swap, equity or equity index option, bond option, interest rate option, foreign exchange transaction, cap transaction, floor transaction, collar transaction, currency swap transaction, cross-currency rate swap transaction, currency option or any other similar transaction (including any option with respect to any of these transactions), (b) any combination of these transactions and (c) any other transaction identified as a Specified Transaction in this Agreement or the relevant confirmation. "STAMP TAX" means any stamp, registration, documentation or similar tax. "TAX" means any present or future tax, levy, impost, duty, charge, assessment or fee of any nature (including interest, penalties and additions thereto) that is imposed by any government or other taxing authority in respect of any payment under this Agreement other than a stamp, registration, documentation or similar tax. "TAX EVENT" has the meaning specified in Section 5(b). "TAX EVENT UPON MERGER" has the meaning specified in Section 5(b). "TERMINATED TRANSACTIONS" means with respect to any Early Termination Date (a) if resulting from a Termination Event, all Affected Transactions and (b) if resulting from an Event of Default, all Transactions (in either case) in effect immediately before the effectiveness of the notice designating that Early Termination Date (or, if "Automatic Early Termination" applies, immediately before that Early Termination Date). "TERMINATION CURRENCY" has the meaning specified in the Schedule. "TERMINATION CURRENCY EQUIVALENT" means, in respect of any amount denominated in the Termination Currency, such Termination Currency amount and, in respect of any amount denominated in a currency other than the Termination Currency (the "Other Currency"), the amount in the Termination Currency determined by the party making the relevant determination as being required to purchase such amount of such Other Currency as at the relevant Early Termination Date, or, if the relevant Market Quotation or Loss (as the case may be), is determined as of a later date, that later date, with the Termination Currency at the rate equal to the spot exchange rate of the foreign exchange agent (selected as provided below) for the purchase of such Other Currency with the Termination Currency at or about 11:00 a.m. (in the city in which such foreign exchange agent is located) on such date as would be customary for the determination of such a rate for the purchase of such Other Currency for value on the relevant Early Termination Date or that later date. The foreign exchange agent will, if only one party is obliged to make a determination under Section 6(e), be selected in good faith by that party and otherwise will be agreed by the parties. "TERMINATION EVENT" means an illegality, a Tax Event or a Tax Event Upon Merger or, if specified to be applicable, a Credit Event Upon Merger or an Additional Termination Event. "TERMINATION RATE" means a rate per annum equal to the arithmetic mean of the cost (without proof or evidence of any actual cost) to each party (as certified by such party) if it were to fund or of funding such amounts. "UNPAID AMOUNTS" owing to any party means, with respect to an Early Termination Date, the aggregate of (a) in respect of all Termination Transactions, the amounts that became payable (or that would have become payable but for Section 2(a)(iii)) to such party under Section 2(a)(i) on or prior to such Early Termination Date and which remain unpaid as at such Early Termination Date and (b) in respect of each Terminated Transaction, for each obligation under Section 2(a)(i) which was (or would have been but for Section 2(a)(iii)) required to be settled by delivery to such party on or prior to such Early Termination Date and which has not been so settled as at such Early Termination Date, an amount equal to the fair market 17 value of that which was (or would have been) required to be delivered as of the originally scheduled date for delivery, in each case together with (to the extent permitted under applicable law) interest, in the currency of such amounts, from (and including) the date such amounts or obligations were or would have been required to have been paid or performed to (but excluding) such Early Termination Date, at the Applicable Rate. Such amounts of interest will be calculated on the basis of daily compounding and the actual number of days elapsed. The fair market value of any obligation referred to in clause (b) above shall be reasonably determined by the party obliged to make the determination under Section 6(e) or, if each party is so obliged, it shall be the average of the Termination Currency Equivalents of the fair market values reasonably determined by both parties. IN WITNESS WHEREOF the parties have executed this document on the respective dates specified below with effect from the date specified on the first page of this document. TOYOTA AUTO RECEIVABLES TOYOTA MOTOR CREDIT CORPORATION 2001-B OWNER TRUST* - ------------------------------- ---------------------------- (Name of Party) (Name of Party) By: /s/ George E. Borst By: /s/ Sterling C. Correia -------------------------- ------------------------- Name: George E. Borst Name: STERLING C. CORREIA Title: President and Chief Executive Officer Title: VICE PRESIDENT Date: Date: *By: FIRST UNION TRUST COMPANY NATIONAL ASSOCIATION, not in its individual capacity but sole as Owner Trustee 18 EX-4.7 8 a2049889zex-4_7.txt EXHIBIT 4.7 EXHIBIT 4.7 SCHEDULE TO THE MASTER AGREEMENT DATED AS OF MAY 15, 2001 BETWEEN TOYOTA MOTOR CREDIT CORPORATION. ("PARTY A") AND TOYOTA AUTO RECEIVABLES 2001-B OWNER TRUST ("PARTY B") Part 1. Termination Provisions. (a) "SPECIFIED ENTITY" means in relation to Party A for the purpose of: Section 5(a)(v), None Section 5(a)(vi), None Section 5(a)(vii), None Section 5(b)(iv), None and in relation to Party B for the purpose of: Section 5(a)(v), None Section 5(a)(vi), None Section 5(a)(vii), None Section 5(b)(iv), None (b) "SPECIFIED TRANSACTION" has the meaning specified in Section 14. (c) The "BREACH OF AGREEMENT" provisions of Section 5(a)(ii) will not apply to Party B. The "CREDIT SUPPORT DEFAULT" provisions of Section 5(a)(iii) will not apply to Party A or Party B. The "MISREPRESENTATION" provisions of Section 5(a)(iv) will not apply to Party B. The "DEFAULT UNDER THE SPECIFIED TRANSACTION" provisions of Section 5(a)(v) will not apply to Party A and will not apply to Party B. The "CROSS DEFAULT" provisions of Section 5(a)(vi) will not apply to Party A and will not apply to Party B. (d) The "CREDIT EVENT UPON MERGER" provisions of Section 5(b)(iv) will not apply to Party A and will not apply to Party B. (e) The "AUTOMATIC EARLY TERMINATION" provisions of Section 6(a) will apply to Party A and Party B. If an Early Termination Date occurs under Section 6(a) as a result of Automatic Early Termination, the Defaulting Party shall fully indemnify the Non-defaulting Party on demand 1 against all expense, loss, damage or liability that the Non-defaulting Party may incur in respect of this Agreement and each Transaction as a consequence of movements in interest, currency, exchange or other relevant rates or prices or Market Quotations between the Early Termination Date and the Local Business Day on which the Non-defaulting Party first becomes aware that the Early Termination Date has occurred under Section 6(a). The Non-defaulting Party may for this purpose convert any expense, loss, damage or liability to the Termination Currency. (f) PAYMENTS ON EARLY TERMINATION. "Market Quotation" and "Second Method" will apply for the purpose of Section 6(e) of this Agreement; PROVIDED, HOWEVER, in the case of the Additional Termination Event specified in this Agreement that occurs other than as a result of an amendment after the date hereof to the Investment Company Act of 1940, as amended, or the promulgation of regulations thereunder after the date hereof, the related Settlement Amount for each Party will be deemed to be zero. (g) "TERMINATION CURRENCY" means United States Dollars. (h) ADDITIONAL TERMINATION EVENT will apply. Any of the following shall constitute an Additional Termination Event: INVESTMENT COMPANY. Party A or Party B becomes subject to registration as an "investment company" for purposes of the Investment Company Act of 1940, as amended (in which event Party A and Party B shall be the Affected Parties and all Transactions shall be Affected Transactions). EVENT OF DEFAULT UNDER INDENTURE. Any event of default (as defined in the Indenture) shall occur and be continuing resulting in acceleration of the Notes in accordance with the Indenture (in which event Party A and Party B shall be the Affected Parties and all Transactions shall be Affected Transactions). REPLACEMENT AGREEMENT. Upon an event that a replacement Agreement shall have been entered into between Party B and a Transferee in accordance with Part 5(f) of this Schedule (in which event, Party A and Party B shall be Affected Parties and all Transactions shall be Affected Transactions); Part 2. Tax Representations (a) PAYER REPRESENTATIONS. For the purpose of Section 3(e) of this Agreement, each of Party A and Party B makes the following representation: It is not required by any applicable law, as modified by the practice of any relevant governmental revenue authority, of any Relevant Jurisdiction to make any deduction or withholding for or on account of any Tax from any payment (other than interest under Section 2(e), 6(d)(ii) or 6(e) of this Agreement) to be made by it to the other party under this Agreement. In making this representation, it may rely on (i) the accuracy of any representations made by the other party pursuant to Section 3(f) of this Agreement, (ii) the satisfaction of the agreement of the other party contained in Section 4(a)(i) or 4(a)(iii) of this Agreement and the accuracy and effectiveness of any document provided by the other party pursuant to Section 4(a)(i) or 4(a)(iii) of this Agreement and (iii) the satisfaction of the agreement of the other party contained in Section 4(d) of this Agreement, PROVIDED that it shall not be a breach of this representation where reliance is placed on clause (ii) and the other party does not deliver a form or document under Section 4(a)(iii) by reason of material prejudice to its legal or commercial position. 2 (b) PAYEE TAX REPRESENTATIONS. For the purpose of Section 3(f) of this Agreement, Party A and Party B make the representations specified below: (A) Party A makes the following representation: It is a corporation duly organized and incorporated under the laws of the State of California. (B) Party B makes the following representation: It is a trust organized or formed under the laws of the State of Delaware. Part 3. Agreement to Deliver Documents For the purpose of Section 4(a) of this Agreement, each party agrees to deliver the following documents as applicable: (a) Tax forms, documents or certificates to be delivered are:
PARTY REQUIRED TO DATE BY WHICH TO BE DELIVER DOCUMENT FORM/DOCUMENT/CERTIFICATE DELIVERED ---------------- ------------------------- --------- Party A and Party B Any document required or reasonably requested Promptly upon the earlier of (i) to allow the other party to make payments reasonable demand by the other under this Agreement without any deduction or party and (ii) learning that the withholding for or on account of any Tax or form or document is required. with such deduction or withholding at a reduced rate
(b) Other documents to be delivered are:
PARTY REQUIRED TO COVERED BY SECTION DELIVER DOCUMENT FORM.DOCUMENT CERTIFICATE DATE BY WHICH TO BE DELIVERED 3(d) REPRESENTATION ---------------- ------------------------- ----------------------------- ------------------- Party A and Party B Certificate or other documents At or promptly following the Yes evidencing the authority of the execution of this Agreement, and, if party entering into this Agreement a Confirmation so requires it on or and the persons acting on behalf of before the date set forth therein such party Party A and Party B Legal Opinions in the form At or promptly following the No. reasonably acceptable to the other execution of this Agreement party
3 Part 4. Miscellaneous (a) ADDRESSES FOR NOTICES: For the purpose of Section 12(a) of this Agreement: Address for notices or communications to Party A: Address: 19001 South Western Avenue Torrance, California 90509 Attention: Vice President, Treasury Telex No.: 3719707 Facsimile No.: 310-468-6194 Answerback: TMSUSA Z (For all purposes) Address for notices or communications to Party B: Address: Toyota Auto Receivables 2001-B Owner Trust c/o First Union Trust Company, National Association One Rodney Square 920 King Street, Suite 102 Wilmington, Delaware 19801 Attention: Sterling C. Correia, Vice President Fax: 302-888-7544 (For all purposes) (b) PROCESS AGENT. For the purpose of Section 13(c): Party A appoints as its Process Agent: Not Applicable Party B appoints as its Process Agent: Not Applicable (c) OFFICES. The provisions of Section 10(a) will apply to this Agreement. (d) MULTIBRANCH PARTY. For the purpose of Section 10: Party A is not a Multibranch Party. Party B is not a Multibranch Party. (e) CALCULATION AGENT. Party A will be the Calculation Agent. All calculations by the Calculation Agent (the "CA") shall be made in good faith and through the exercise of the CA's commercially reasonable judgment. (f) CREDIT SUPPORT DOCUMENT. Details of any Credit Support Document: Party A: Not Applicable Party B: Not Applicable 4 (g) Credit Support Provider. Party A: Not Applicable Party B: Not Applicable (h) GOVERNING LAW. This Agreement and each Confirmation will be governed by and construed in accordance with the laws of the State of New York, without reference to its choice of law doctrine. (i) WAIVER OF JURY TRIAL. Each party waives, to the fullest extent permitted by applicable law, any right it may have to a trial by jury in respect of any proceedings relating to this Agreement. (j) "AFFILIATE" will have the meaning specified in Section 14 of this Agreement. Part 5. Other Provisions (a) GROSS-UP, LIABILITY. Neither Party A nor Party B will in any circumstance be required to pay additional amounts in respect of any Indemnifiable Tax or be under any obligation to pay to the other any amount in respect of any liability of such other for or on account of any Tax and, accordingly, Section 2(d)(i)(4) and Section 2(d)(ii) of this Agreement shall not apply. (b) EARLY TERMINATION. (i) Section 6(b)(ii) is hereby amended to read in its entirety as follows: TRANSFER TO AVOID TERMINATION EVENT. (1) If an Illegality under Section 5(b)(i)(1) or a Tax Event or a Tax Event Upon Merger occurs, if Party A is the Affected Party it will, and, if Party B is the Affected Party it will request Party A to, as a condition to its right, if any, to designate an Early Termination Date under Section 6(b)(iv), use all reasonable efforts (which will not require Party A to incur a loss, excluding immaterial, incidental expenses) to transfer within 20 days after it gives notice under Section 6(b)(i) all its rights and obligations under this Agreement in respect of the Affected Transactions to another of its Offices so that such Termination Event ceases to exist. If Party A is not able to make such a transfer it will give notice to Party B to that effect within such 20 day period. Any such transfer under this Section 6(b)(ii)(1) will be subject to and conditional upon the prior written consent of the other party, which consent will not be withheld if such other party's policies in effect at such time would permit it to enter into transactions with the transferee on the terms proposed. (2) No transfer or substitution pursuant to this Section 6(b)(ii) shall occur unless and until the Indenture Trustee has received the written affirmation of each of Standard & Poor's and Moody's that such transfer or substitution shall not adversely affect the then-current ratings of the Notes. (c) Section 6(b)(iii) shall not apply. (d) Section 6(b)(iv) is hereby amended by (i) deleting (A) the words "a Credit Event Upon Merger" wherever they appear in that provision. 5 (e) Any termination payment payable pursuant to Section 6(e) shall be computed separately for each Transaction hereunder and any amount owed by either Party A or Party B with respect to the termination of any such Transaction shall be netted against other amounts due under this Agreement. (f) Section 7 is hereby amended to read in its entirety as follows: Except as stated under Section 6(b)(ii) and as provided in this Section 7, and except for the assignment by way of security in favor of the Indenture Trustee under the Indenture, neither Party A nor Party B is permitted to assign, novate or transfer as a whole or in part any of its rights, obligations or interests under this Agreement. Party A may transfer this Agreement to another party (the "Transferee"), on ten (10) Business Days' prior written notice, PROVIDED that (i) such notice shall be accompanied by a guarantee by Party A of such Transferee's obligations in form and substance reasonably satisfactory to the Indenture Trustee; (ii) Party A delivers an opinion of independent counsel of recognized standing in form and substance reasonably satisfactory to the Indenture Trustee confirming that as of the date of such transfer the Transferee will not, as a result of such transfer, be required to withhold or deduct on account of tax under this Agreement; (iii) a Termination Event or Event of Default does not occur under this Agreement as a result of such transfer and (iv) the Indenture Trustee has received written affirmation of Standard & Poor's and Moody's (or their successors) that such transfer shall not adversely affect the then-current ratings of the Notes. In addition, in the event the long-term debt rating of Party A is reduced to a level below "Aa3" by Moody's (or its successor) or "AA-" by Standard & Poor's (or its successor) or the short-term debt rating of Party A is reduced to a level below "P-1" by Moody's or "A-1+" by Standard Poor's, or in either case, such lower ratings as may be permitted by Moody's and Standard & Poor's without causing a downgrade in the ratings applicable to the Notes), Party A may, but shall not be required to, (A) post Eligible Collateral in an amount equal to the Credit Support Amount with Party B, PROVIDED that (i) a Termination Event or Event of Default does not occur under this Agreement as a result of such collateralization and (ii) if Party A posts collateral, the ratings assigned to the Notes after the posting of such Eligible Collateral will be at least equal to the ratings assigned by Moody's and Standard & Poor's (or their successors) to the Notes at the time of such reduction of the rating of Party A's long-term debt or (B) assign this Agreement to another party (or otherwise obtain a replacement swap agreement on substantially the same terms as this Agreement) and thereby be released from its obligations under this Agreement, PROVIDED that, in the case of an assignment or an implementation of a replacement swap pursuant to clause (B), (i) the Transferee, by a written instrument, accepts all of the obligations of Party A under this Agreement to the reasonable satisfaction of the Indenture Trustee or enters into a replacement swap agreement providing for substantially the same obligations as this Agreement, (ii) Party A delivers an opinion of independent counsel of recognized standing in form and substance reasonably satisfactory to the Indenture Trustee confirming that as of the date of such transfer the Transferee will not, as a result of such transfer, be required to withhold or deduct on account of tax under this Agreement, (iii) a Termination Event or Event of Default does not occur under this Agreement as a result of such transfer and (iv) the ratings assigned to the Notes after such assignment and release will be at least equal to the ratings assigned by Moody's and Standard & Poor's (or their successors) to the Notes at the time of such reduction of the rating of Party A's long-term debt. Any cost of such transfer will be borne by Party A or such Transferee and not by Party B. Upon successful consummation of any such transfer or the implementation of a replacement swap, Party B shall release its security interest in, and return to Party A, at the expense of Party A, any then-posted collateral. In addition, in the event that Party A does not elect to post collateral, assign this Agreement or obtain a replacement swap agreement after such a reduction in rating, Party A may (but shall not be obligated to) establish any other arrangement satisfactory to Moody's and Standard & Poor's 6 such that the ratings of the Notes by the applicable rating agency will not be withdrawn or reduced. (g) ADDITIONAL REPRESENTATIONS. Section 3 is hereby amended by adding at the end thereof the following Subparagraphs: (g) It is entering into this Agreement and any other documentation relating to this Agreement as principal (and not as agent or in any other capacity, fiduciary or otherwise). (h) It is an "eligible swap participant" as defined in 17 C.F.R. Section 35.1(b)(2) and has entered into this Agreement and each Transaction in connection with its line of business including financial intermediation services or the financing of its business. (i) It hereby acknowledges and agrees that this Agreement and each Transaction hereunder or thereunder is intended to be a "swap agreement" as that term is defined in the U.S. Bankruptcy Code (as amended from time to time) and that the rights granted to each party under Section 6 include a contractual right to terminate a "swap agreement" and to offset and net out termination values and payment amounts in connection therewith. (h) NO PETITION. Section 4 of this Agreement is hereby amended by the addition thereto of the following new clause (f): (f) Party A hereby covenants and agrees that it will not institute against Party B or Toyota Auto Finance Receivables LLC ("TAFR LLC"), or join in any institution against Party B or TAFR LLC of, any bankruptcy, reorganization, arrangement, insolvency or liquidation proceedings, or other proceedings under any federal or state bankruptcy or similar law, and that this covenant and agreement will survive the termination of this Agreement. Party B hereby covenants and agrees that it will not institute against Party A, or join in any institution against Party A of, any bankruptcy, reorganization, arrangement, insolvency or liquidation proceedings, or other proceedings under any federal or state bankruptcy or similar law, and that this covenant and agreement will survive the termination of this Agreement. (i) AMENDMENTS. Section 9(b) of this Agreement is hereby amended to read: AMENDMENTS. No amendment, modification or waiver in respect of this Agreement will be effective unless in writing and executed by each of the parties and the parties (i) have received a written affirmation from Standard & Poor's, that such amendments, modifications or waivers shall not adversely affect the then-current ratings of the Notes and (ii) have provided Moody's with ten (10) days prior written notice of such amendments, modifications or waivers and Moody's shall not have notified the parties that such amendment, modifications or waivers would adversely affect then-current ratings of the Notes. (j) CONFIRMATIONS. Each Confirmation supplements, forms part of, and will be read and construed as one with this Agreement. (k) ADDITIONAL DEFINITIONS. Terms defined or referred to in the Indenture shall bear the same respective meanings herein. (i) "INDENTURE" shall mean the indenture pursuant to which Party B will issue the Notes, dated as of April 1, 2001, between Party B and Wells Fargo Bank Minnesota, National Association, as indenture trustee and securities intermediary. "Indenture 7 Trustee" shall mean Wells Fargo Bank Minnesota, National Association, in its capacity as indenture trustee under the Indenture. (ii) "NOTES" means the Class A-1, Class A-2, Class A-3 and Class A-4 Notes issued by Party B pursuant to the Indenture. (iii) "CREDIT SUPPORT AMOUNT" means, as of the determination date, an amount equal to the termination payment payable pursuant to Section 6(e) if this Agreement was terminated as of such determination date. (iv) The following items will qualify as "ELIGIBLE COLLATERAL" for Party A: Valuation Percentage (A) Cash 100% (B) Direct registered obligations of, and registered obligations 100% the timely payment of principal of and interest on which is fully and expressly guaranteed by, the United States of America, or any agency or instrumentality of the United States of America the obligations of which are backed by the full faith and credit of the United States of America. (C) Demand and time deposit in, certificates of deposit of, or 100% federal funds sold by any depository institution or trust company (including the Trustee) incorporated under the laws of the United States of America or any state thereof and subject to supervision and examination by federal and/or state banking authorities so long as the commercial paper and/or other debt obligations of such depository institution or trust company (or, in the case of the principal depository institution in a holding company system, the commercial paper or debt obligation of such holding company) at the time of such investment or the contractual commitment providing for such investment have a credit rating of "Aa2" and "AAA" in the case of debt obligations other than commercial paper, or "P-1" or better and "A-1+" or better, in the case of commercial paper, by Moody's and Standard & Poor's, respectively.
PROVIDED, HOWEVER, that Eligible Collateral shall include only such obligations or securities that mature no later than the next Payment Date (as defined in the Indenture); and PROVIDED FURTHER, that none of the foregoing obligations or securities shall constitute Eligible Collateral if all, or substantially all, of the remaining amounts payable thereunder shall consist of interest and not principal payments, if such security is purchased at a price in excess of 100% of par, or if such security is subject to substantial non-credit related risk. 8 (l) INTEREST RATE AND CURRENCY EXCHANGES DEFINITIONS. Reference is hereby made to the 2000 ISDA Definitions as supplemented by the Annex to the 2000 ISDA Definitions, each published by the International Swaps and Derivatives Association, Inc. (collectively, the "Definitions"), which are hereby incorporated by reference herein without regard to any revision or subsequent edition thereof. (m) NO SET-OFF. Without affecting the provisions of this Agreement requiring the calculation of certain net payment amounts, all payments under this Agreement will be made without set-off or counterclaims. (n) INCONSISTENCY. In the event of an inconsistency among or between any of the following documents, the relevant document first listed below shall govern. (i) Confirmation; (ii) Schedule; (iii) Definitions; (iv) Sections 1 through 14 of this Agreement. (o) DEFAULT INTEREST; OTHER AMOUNTS. Section 2(e) of this Agreement is hereby amended by adding the following at the end of the first sentence thereof: ; PROVIDED, HOWEVER, that this Section 2(e) shall not apply to either Party A or Party B if its failure to pay is caused solely by such party becoming required to deduct or withhold on account of any Tax as set out in Section 2(d)(i). (p) SCOPE OF OBLIGATIONS OF THE OWNER TRUSTEE. The parties hereto agree that: (i) This Agreement is executed and delivered by First Union Trust Company, National Association, not individually or personally but solely in its capacity as Owner Trustee on behalf of the Trust, in the exercise of the powers and authority conferred and vested in the Owner Trustee under the Trust Agreement. (ii) Each of the representations, undertakings and agreements herein made on the part of the Trust is made and intended not as a personal representation, undertaking or agreement by the Owner Trustee but is made and intended for the purpose of binding only the Trust. (iii) The Owner Trustee shall not be required to expend or risk its own funds or otherwise incur any liability in connection with this Agreement, and Party A shall not bring any claim whatsoever against the Owner Trustee in its individual capacity or against the assets of the Owner Trustee (other than the assets of the Trust). (q) NONPETITION COVENANT. Notwithstanding any prior termination of this Agreement, Party A shall not, prior to the date which is one year and one day after the termination of this Agreement, with respect to Party B, acquiesce, petition or otherwise invoke or cause Party B to invoke the process of any court or government authority for the purpose of commencing or sustaining a case against Party B under any federal or state bankruptcy, insolvency or similar law, or appointing a receiver, liquidator, assignee, trustee, custodian, sequestrator or other similar official of Party B or any substantial part of its property, or ordering the winding up or liquidation of the affairs of Party B. 9 IN WITNESS WHEREOF, the parties have executed this Schedule by their duly authorized officers as of May 15, 2001. TOYOTA MOTOR CREDIT CORPORATION By: /s/ George E. Borst ------------------------------------------------- Name: George E. Borst Title: President and Chief Executive Officer Confirmed as of the date first written: TOYOTA AUTO RECEIVABLES 2001-B OWNER TRUST By: FIRST UNION TRUST COMPANY, NATIONAL ASSOCIATION, not in its individual capacity but solely as Owner Trustee By: /s/ Sterling C. Correia ------------------------------------------ Name: Sterling C. Correia Title: Vice President S-1 EX-4.8 9 a2049889zex-4_8.txt EXHIBIT 4.8 EXHIBIT 4.8 Class A-2 Confirmation to the ISDA Master Agreement dated as of May 15, 2001 Toyota Auto Receivables 2001-B Owner Trust c/o First Union Trust Company, National Association One Rodney Square 920 King Street, Suite 102 Wilmington, Delaware 19801 Re: Transaction Ref. No. 1 between Toyota Motor Credit Corporation ("Party A") and Toyota Auto Receivables 2001-B Owner Trust ("Party B") Ladies and Gentlemen: The purpose of this letter agreement is to confirm the terms and conditions of the Swap Transaction entered into between you and us on the Trade Date specified below (the "Transaction"). This letter agreement constitutes a "Confirmation" as referred to in the ISDA Master Agreement specified below. The definitions and provisions contained in the 2000 ISDA Definitions as supplemented by the Annex to the 2000 ISDA Definitions, each published by the International Swaps and Derivatives Association, Inc. (collectively, the "Definitions"), are incorporated in this Confirmation. In the event of any inconsistency between those Definitions and this Confirmation, this Confirmation will govern. 1. This Confirmation supplements, forms part of, and is subject to, the ISDA Master Agreement, dated as of May 15, 2001, as amended and supplemented from time to time (the "Agreement"), between you and us. All provisions contained in the Agreement govern this Confirmation except as expressly modified below. Expressions used herein and not defined herein or in the Definitions shall bear the meaning ascribed thereto in the Agreement. 2. The terms of the particular Transaction to which this Confirmation relates are as follows: Party A: Toyota Motor Credit Corporation Party B: Toyota Auto Receivables 2001-B Owner Trust Trade Date: May 15, 2001 Effective Date: May 15, 2001 1
Termination Date: The earlier of (i) the Class A-2 Final Scheduled Payment Date (as defined in the Indenture) or (ii) the Payment Date (as defined in the Indenture) on which the principal balance of the Class A-2 Notes is reduced to zero, in either case subject to adjustment in accordance with the Following Business Day Convention. Party A Floating Amounts: Party A Floating Rate Payer: Party A Party A Floating Rate Payer Notional Amount: The Class A-2 Note Balance (as defined in the Indenture) on the first day of the applicable Calculation Period. Party A Floating Rate Payer Period End Dates: The 15th day of each calendar month, commencing on June 15, 2001, up to and including the Termination Date, subject to adjustment in accordance with the Following Business Day Convention. Party A Floating Rate Payer Payment Dates: The Business Day immediately preceding each Period End Date, or if Party B has agreed, the 15th day of each calendar month, commencing on June 15, 2001, up to and including the Termination Date, subject to adjustment in accordance with the Following Business Day Convention. Party A Floating Rate Option: USD-LIBOR-BBA. Designated Maturity: One month. Spread: Plus 0.060% Party A Floating Rate Day Count Fraction: Actual/360 Reset Dates: The first day of each Calculation Period. Compounding: Inapplicable. Party B Fixed Amounts: 2 Party B Fixed Rate Payer: Party B Party B Fixed Rate Payer Notional Amount: The Class A-2 Note Balance on the first day of the applicable Calculation Period. Party B Fixed Rate Payer Period End Dates: The 15th day of each calendar month, commencing on June 15, 2001, with no adjustment. Party B Fixed Rate Payer Payment Dates: The 15th day of each calendar month, commencing on June 15, 2001, up to and including the Termination Date, subject to adjustment in accordance with the Following Business Day Convention. Party B Fixed Rate 4.562% Party B Fixed Rate Day Count Fraction: 30/360 Fixed Rate Compounding: Not applicable. Business Days: Any day other than a Saturday, a Sunday or a day on which banking institutions or trust companies in New York, New York, Minneapolis, Minnesota, Wilmington, Delaware or San Francisco, California are authorized or obligated by law, regulation or executive order to remain closed. Calculation Agent: Party A 3. Account Details Payments to Party A: Account for Payments in USD: Bank of America, Concord, California ABA No. 121-000-358 A/C No. 12351-07564 A/C Toyota Motor Credit Corporation 3 Payments to Party B: Account for Payments in USD: Wells Fargo Bank Minnesota, N.A. ABA: 091000019 Acct: 0001038377 Acct Name: Wells Fargo Corporate Trust 4. Party A Documentation and Operations Officers Documentation: Carolee Furukawa Phone: 310-468-6806 Fax: 310-468-5715 Operations: Carolee Furukawa Phone: 310-468-6806 Fax: 310-468-5715
5. Relationship between Parties: Each party will be deemed to represent to the other party on the date on which it enters into the Agreement that (absent a written agreement between the parties that expressly imposes affirmative obligations to the contrary): NON-RELIANCE. It is acting for its own account, and it has made its own independent decisions to enter into the Agreement and as to whether the Agreement is appropriate or proper for it based upon its own judgment and upon advice from such advisers as it has deemed necessary. It is not relying on any communication (written or oral) of the other party as investment advice or as a recommendation to enter into the Agreement; it being understood that information and explanations related to the terms and conditions of the Agreement shall not be considered investment advice or a recommendation to enter into the Agreement. No communication (written or oral) received from the other party shall be deemed to be an assurance or guarantee as to the expected results of the Agreement. ASSESSMENT AND UNDERSTANDING. It is capable of assessing the merits of and understanding (on its own behalf or through independent professional advice), and understands and accepts, the terms, conditions and risks of the Agreement. It is also capable of assuming, and assumes, the risks of the Agreement. STATUS OF PARTIES. The other party is not acting as a fiduciary for or as adviser to it in respect of the Agreement. 6. Governing Law: New York 4 Please confirm that the foregoing correctly sets forth the terms of our agreement by executing the copy of this Class A-2 Confirmation enclosed for that purpose and returning it to us. TOYOTA MOTOR CREDIT CORPORATION By: /s/ George E. Borst ------------------------------------------ Name: George E. Borst Title: President and Chief Executive Officer Confirmed as of the date first written: TOYOTA AUTO RECEIVABLES 2001-B OWNER TRUST By: FIRST UNION TRUST COMPANY, NATIONAL ASSOCIATION, not in its individual capacity but solely as Owner Trustee By: /s/ Sterling C. Correia ------------------------------------------ Name: Sterling C. Correia Title: Vice President S-1 EX-4.9 10 a2049889zex-4_9.txt EXHIBIT 4.9 EXHIBIT 4.9 Class A-3 Confirmation to the ISDA Master Agreement dated as of May 15, 2001 Toyota Auto Receivables 2001-B Owner Trust c/o First Union Trust Company, National Association One Rodney Square 920 King Street, Suite 102 Wilmington, Delaware 19801 Re: Transaction Ref. No. 2 between Toyota Motor Credit Corporation ("Party A") and Toyota Auto Receivables 2001-B Owner Trust ("Party B") Ladies and Gentlemen: The purpose of this letter agreement is to confirm the terms and conditions of the Swap Transaction entered into between you and us on the Trade Date specified below (the "Transaction"). This letter agreement constitutes a "Confirmation" as referred to in the ISDA Master Agreement specified below. The definitions and provisions contained in the 2000 ISDA Definitions, as supplemented by the Annex to the 2000 ISDA Definitions, each published by the International Swaps and Derivatives Association, Inc. (collectively, the "Definitions"), are incorporated in this Confirmation. In the event of any inconsistency between those Definitions and this Confirmation, this Confirmation will govern. 1. This Confirmation supplements, forms part of, and is subject to, the ISDA Master Agreement, dated as of May 15, 2001, as amended and supplemented from time to time (the "Agreement"), between you and us. All provisions contained in the Agreement govern this Confirmation except as expressly modified below. Expressions used herein and not defined herein or in the Definitions shall bear the meaning ascribed thereto in the Agreement. 2. The terms of the particular Transaction to which this Confirmation relates are as follows: Party A: Toyota Motor Credit Corporation Party B: Toyota Auto Receivables 2001-B Owner Trust Trade Date: May 15, 2001 Effective Date: May 15, 2001 Termination Date: The earlier of (i) the Class A-3 Final Scheduled Payment Date (as defined in the Indenture) or 1
(ii) the Payment Date (as defined in the Indenture) on which the principal balance of the Class A-3 Notes is reduced to zero, in either case subject to adjustment in accordance with the Following Business Day Convention. Party A Floating Amounts: Party A Floating Rate Payer: Party A Party A Floating Rate Payer Notional Amount: The Class A-3 Note Balance (as defined in the Indenture) on the first day of the applicable Calculation Period. Party A Floating Rate Payer Period End Dates: The 15th day of each calendar month, commencing on June 15, 2001, up to and including the Termination Date, subject to adjustment in accordance with the Following Business Day Convention. Party A Floating Rate Payer Payment Dates: The Business Day immediately preceding each Period End Date, or if Party B has agreed, the 15th day of each calendar month, commencing on June 15, 2001, up to and including the Termination Date, subject to adjustment in accordance with the Following Business Day Convention. Party A Floating Rate Option: USD-LIBOR-BBA. Designated Maturity: One month. Spread: Plus 0.080% Party A Floating Rate Day Count Fraction: Actual/360 Reset Dates: The first day of each Calculation Period. Compounding: Inapplicable. Party B Fixed Amounts: Party B Fixed Rate Payer: Party B 2 Party B Fixed Rate Payer Notional Amount: The Class A-3 Note Balance on the first day of the applicable Calculation Period. Party B Fixed Rate Payer Period End Dates: The 15th day of each calendar month, commencing on June 15, 2001, with no adjustment. Party B Fixed Rate Payer Payment Dates: The 15th day of each calendar month, commencing on June 15, 2001, up to and including the Termination Date, subject to adjustment in accordance with the Following Business Day Convention. Party B Fixed Rate 5.018% Party B Fixed Rate Day Count Fraction: 30/360 Fixed Rate Compounding: Not applicable. Business Days: Any day other than a Saturday, a Sunday or a day on which banking institutions or trust companies in New York, New York, Minneapolis, Minnesota, Wilmington, Delaware or San Francisco, California are authorized or obligated by law, regulation or executive order to remain closed. Calculation Agent: Party A 3. Account Details Payments to Party A: Account for Payments in USD: Bank of America, Concord, California ABA No. 121-000-358 A/C No. 12351-07564 A/C Toyota Motor Credit Corporation 3 Payments to Party B: Account for Payments in USD: Wells Fargo Bank Minnesota, N.A. ABA: 091000019 Acct: 0001038377 Acct Name: Wells Fargo Corporate Trust 4. Party A Documentation and Operations Officers Documentation: Carolee Furukawa Phone: 310-468-6806 Fax: 310-468-5715 Operations: Carolee Furukawa Phone: 310-468-6806 Fax: 310-468-5715
5. Relationship between Parties: Each party will be deemed to represent to the other party on the date on which it enters into the Agreement that (absent a written agreement between the parties that expressly imposes affirmative obligations to the contrary): NON-RELIANCE. It is acting for its own account, and it has made its own independent decisions to enter into the Agreement and as to whether the Agreement is appropriate or proper for it based upon its own judgment and upon advice from such advisers as it has deemed necessary. It is not relying on any communication (written or oral) of the other party as investment advice or as a recommendation to enter into the Agreement; it being understood that information and explanations related to the terms and conditions of the Agreement shall not be considered investment advice or a recommendation to enter into the Agreement. No communication (written or oral) received from the other party shall be deemed to be an assurance or guarantee as to the expected results of the Agreement. ASSESSMENT AND UNDERSTANDING. It is capable of assessing the merits of and understanding (on its own behalf or through independent professional advice), and understands and accepts, the terms, conditions and risks of the Agreement. It is also capable of assuming, and assumes, the risks of the Agreement. STATUS OF PARTIES. The other party is not acting as a fiduciary for or as adviser to it in respect of the Agreement. 6. Governing Law: New York 4 Please confirm that the foregoing correctly sets forth the terms of our agreement by executing the copy of this Class A-3 Confirmation enclosed for that purpose and returning it to us. TOYOTA MOTOR CREDIT CORPORATION By: /s/ George E. Borst ------------------------------------------ Name: George E. Borst Title: President and Chief Executive Officer Confirmed as of the date first written: TOYOTA AUTO RECEIVABLES 2001-B OWNER TRUST By: FIRST UNION TRUST COMPANY, NATIONAL ASSOCIATION, not in its individual capacity but solely as Owner Trustee By: /s/ Sterling C. Correia ------------------------------------------ Name: Sterling C. Correia Title: Vice President S-1 EX-4.10 11 a2049889zex-4_10.txt EXHIBIT 4.10 EXHIBIT 4.10 Class A-4 Confirmation to the ISDA Master Agreement dated as of May 15, 2001 Toyota Auto Receivables 2001-B Owner Trust c/o First Union Trust Company, National Association One Rodney Square 920 King Street, Suite 102 Wilmington, Delaware 19801 Re: Transaction Ref. No. 3 between Toyota Motor Credit Corporation ("Party A") and Toyota Auto Receivables 2001-B Owner Trust ("Party B") Ladies and Gentlemen: The purpose of this letter agreement is to confirm the terms and conditions of the Swap Transaction entered into between you and us on the Trade Date specified below (the "Transaction"). This letter agreement constitutes a "Confirmation" as referred to in the ISDA Master Agreement specified below. The definitions and provisions contained in the 2000 ISDA Definitions, as supplemented by the Annex to the 2000 ISDA Definitions, each published by the International Swaps and Derivatives Association, Inc. (collectively, the "Definitions"), are incorporated in this Confirmation. In the event of any inconsistency between those Definitions and this Confirmation, this Confirmation will govern. 1. This Confirmation supplements, forms part of, and is subject to , the ISDA Master Agreement, dated as of May 15, 2001, as amended and supplemented from time to time (the "Agreement"), between you and us. All provisions contained in the Agreement govern this Confirmation except as expressly modified below. Expressions used herein and not defined herein or in the Definitions shall bear the meaning ascribed thereto in the Agreement. 2. The terms of the particular Transaction to which this Confirmation relates are as follows: Party A: Toyota Motor Credit Corporation Party B: Toyota Auto Receivables 2001-B Owner Trust Trade Date: May 15, 2001 Effective Date: May 15, 2001 Termination Date: The earlier of (i) the Class A-4 Final Scheduled Payment Date (as defined in the Indenture) or (ii) the Payment Date (as defined in the Indenture) on which the principal balance of the Class A-4 Notes is reduced to zero, in either case subject to 1 adjustment in accordance with the Following Business Day Convention. Party A Floating Amounts: Party A Floating Rate Payer: Party A Party A Floating Rate Payer Notional Amount: The Class A-4 Note Balance (as defined in the Indenture) on the first day of the applicable Calculation Period. Party A Floating Rate Payer Period End Dates: The 15th day of each calendar month, commencing on June 15, 2001, up to and including the Termination Date, subject to adjustment in accordance with the Following Business Day Convention. Party A Floating Rate Payer Payment Dates: The Business Day immediately preceding each Period End Date, or if Party B has agreed, the 15th day of each calendar month, commencing on June 15, 2001, up to and including the Termination Date, subject to adjustment in accordance with the Following Business Day Convention. Party A Floating Rate Option: USD-LIBOR-BBA. Designated Maturity: One month. Spread: Plus 0.100% Party A Floating Rate Day Count Fraction: Actual/360 Reset Dates: The first day of each Calculation Period. Compounding: Inapplicable. Party B Fixed Amounts: Party B Fixed Rate Payer: Party B Party B Fixed Rate Payer Notional Amount: The Class A-4 Note Balance 2 on the first day of the applicable Calculation Period. Party B Fixed Rate Payer Period End Dates: The 15th day of each calendar month, commencing on June 15, 2001, with no adjustment. Party B Fixed Rate Payer Payment Dates: The 15th day of each calendar month, commencing on June 15, 2001, up to and including the Termination Date, subject to adjustment in accordance with the Following Business Day Convention. Party B Fixed Rate: 5.360% Party B Fixed Rate Day Count Fraction: 30/360 Fixed Rate Compounding: Not applicable. Business Days: Any day other than a Saturday, a Sunday or a day on which banking institutions or trust companies in New York, New York, Minneapolis, Minnesota, Wilmington, Delaware or San Francisco, California are authorized or obligated by law, regulation or executive order to remain closed. Calculation Agent: Party A
3. Account Details Payments to Party A: Account for Payments in USD: Bank of America, Concord, California ABA No. 121-000-358 A/C No. 12351-07564 A/C Toyota Motor Credit Corporation Payments to Party B: Accounts for Payments in USD: Wells Fargo Bank Minnesota, N.A. ABA: 091000019 Acct: 0001038377 Acct Name: Wells Fargo Corporate Trust
3 4. Party A Documentation and Operations Officers Documentation: Carolee Furukawa Phone: 310-468-6806 Fax: 310-468-5715 Operations Carolee Furukawa Phone: 310-468-6806 Fax: 310-468-5715
7. Relationship between Parties: Each party will be deemed to represent to the other party on the date on which it enters into the Agreement that (absent a written agreement between the parties that expressly imposes affirmative obligations to the contrary): NON-RELIANCE. It is acting for its own account, and it has made its own independent decisions to enter into the Agreement and as to whether the Agreement is appropriate or proper for it based upon its own judgment and upon advice from such advisers as it has deemed necessary. It is not relying on any communication (written or oral) of the other party as investment advice or as a recommendation to enter into the Agreement; it being understood that information and explanations related to the terms and conditions of the Agreement shall not be considered investment advice or a recommendation to enter into the Agreement. No communication (written or oral) received from the other party shall be deemed to be an assurance or guarantee as to the expected results of the Agreement. ASSESSMENT AND UNDERSTANDING. It is capable of assessing the merits of and understanding (on its own behalf or through independent professional advice), and understands and accepts, the terms, conditions and risks of the Agreement. It is also capable of assuming, and assumes, the risks of the Agreement. STATUS OF PARTIES. The other party is not acting as a fiduciary for or as adviser to it in respect of the Agreement. 8. Governing Law: New York 4 Please confirm that the foregoing correctly sets forth the terms of our agreement by executing the copy of this Class A-4 Confirmation enclosed for that purpose and returning it to us. TOYOTA MOTOR CREDIT CORPORATION By: /s/ George E. Borst -------------------------------- Name: George E. Borst Title: President and Chief Executive Officer Confirmed as of the date first written: TOYOTA AUTO RECEIVABLES 2001-B OWNER TRUST By: FIRST UNION TRUST COMPANY, NATIONAL ASSOCIATION, not in its individual capacity but solely as Owner Trustee By: /s/ Sterling C. Correia -------------------------------- Name: Sterling C. Correia Title: Vice President S-1 EX-4.11 12 a2049889zex-4_11.txt EXHIBIT 4.11 EXHIBIT 4.11 ASSIGNMENT OF SWAP AGREEMENT ASSIGNMENT OF SWAP AGREEMENT (the "Assignment") dated as of May 15, 2001, by and among TOYOTA AUTO RECEIVABLES 2001-B OWNER TRUST, a Delaware business trust (the "Assignor" or the "Trust"), Wells Fargo Bank Minnesota, National Association, not in its individual capacity but as Indenture Trustee (the "Assignee") of the Toyota Auto Receivables 2001-B Owner Trust pursuant to the Indenture, dated as of April 1, 2001 (the "Indenture"), by and between the Trust and the Indenture Trustee, and TOYOTA MOTOR CREDIT CORPORATION, as swap counterparty. All capitalized terms used herein without definition shall have the meanings ascribed thereto in the Indenture. W I T N E S S E T H: WHEREAS, the Trust has acquired a pool of new and used automobile and light duty truck retail installment sales contracts originated by Toyota and Lexus dealers (the "Receivables") and related property from Toyota Auto Finance Receivables LLC ("TAFR LLC"), a California corporation; WHEREAS, the Assignor is granting to the Assignee all of the Issuer's right, title and interest in and to the Receivables and other interest to be evidenced by certain asset backed notes (the "Notes") and Certificates issued by the Trust; WHEREAS, the Trust and Toyota Motor Credit Corporation (the "Counterparty") have entered and/or anticipate entering into one or more transactions that are or will be governed by that certain ISDA Master Agreement, dated as of May 15, 2001 ("Master Agreement"), which includes a schedule (the "Schedule"), and the Class A-2 Confirmation to the ISDA Master Agreement, dated as of May 15, 2001 (the "Class A-2 Confirmation"), the Class A-3 Confirmation to the ISDA Master Agreement, dated as of May 15, 2001 (the "Class A-3 Confirmation") and the Class A-4 Confirmation to the ISDA Master Agreement, dated as of May 15, 2001 (the "Class A-4 Confirmation," and together with the Master Agreement, Schedule, the Class A-2 Confirmation and the Class A-3 Confirmation, the "Swap Agreement"); WHEREAS, Assignor desires to assign all of its rights, title and interest in and to the Swap Agreement to Assignee; and NOW, THEREFORE, in order to induce Assignee to enter into the Indenture, Assignor does hereby assign, transfer, grant and set over to Assignee all of Assignor's right, title and interest in and to the Swap Agreement, as more particularly provided herein, and subject to the terms and conditions more fully set forth herein: A. Subject to the provisions of Paragraph E below, Assignor hereby irrevocably authorizes and directs the Counterparty to perform directly to, or as directed by, Assignee, and to remit any and all payments due under the Swap Agreement to Assignee, from and after the date hereof. B. All notices, demands, requests, consents, approvals and other instruments under this Assignment shall be in writing and shall be sent and shall be deemed to have been actually or properly given if and when given in accordance with the notice provisions of the Notes. C. Anything contained herein or in the Notes, the Indenture or any other security documents to the contrary notwithstanding, Assignee's recourse for the performance of all of the obligations and liabilities of Assignor under this Assignment shall be limited to the same extent as, and for the protection of the same persons and entities described in, the Swap Agreement. D. Except as otherwise expressly provided, nothing contained herein shall operate or be construed to impose any obligation upon the Assignee with respect to the Swap Agreement. E. 1. This Assignment and all rights hereunder assigned to Assignee shall cease and terminate upon payment in full by the Assignor of the principal amount of and interest on the Notes and any that are then due and payable. 2. In addition, in the event that any portion of the Swap Agreement is sold, assigned or otherwise disposed of in connection with a redemption or prepayment of the Class A-2 Notes, the Class A-3 Notes and the Class A-4 Notes, such portion of the Swap Agreement shall be released from this Assignment. 3. In connection with any release of this Agreement pursuant to this Paragraph E, Assignee shall execute such documents as may be reasonably requested by Assignor to acknowledge such release. Any documents delivered to confirm such release shall be prepared by counsel for Assignor at Assignor's reasonable expense and shall expressly provide that such confirmation is without recourse and without any representation or warranty, express or implied (except that Assignee shall represent that such document has been and is duly authorized, that all necessary consents to the execution and delivery thereof have been obtained and that it has not assigned or encumbered this Swap Agreement). If the Swap Agreement is released in its entirety, Assignee, at the request and sole cost and expense of Assignor made at the time of any such release, will execute and deliver to Assignor a proper instrument or instruments acknowledging the satisfaction and termination of this Assignment, and will duly assign and transfer, without recourse and without any representation or warranty, express or implied (except that Assignee shall represent that such termination and such assignment and transfer has been and is duly authorized, that all necessary consents to the execution and delivery thereof have been obtained and that it has not assigned or encumbered the Swap Agreement) the Swap Agreement and deliver so much thereof as shall be in its 2 possession and as has not theretofore been sold or otherwise applied or released pursuant to this Assignment, together with any moneys at the time held by Assignee hereunder and not applied to the payment of the secured obligations of Assignor. F. THIS ASSIGNMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK. G. This Assignment shall be binding upon and shall inure to the benefit of the heirs, legal representatives, successors and assigns of Assignor and Assignee. [Remainder of the page intentionally left blank.] 3 IN WITNESS WHEREOF, the undersigned have executed this Agreement as of the date first above written. ASSIGNOR: TOYOTA AUTO RECEIVABLES 2001-B OWNER TRUST By: First Union Trust Company, National Association, not in its individual capacity but solely as Owner Trustee on behalf of the Issuer By: /s/ Sterling C. Correia --------------------------------- Name: Sterling C. Correia Title: Vice President ASSIGNEE: WELLS FARGO BANK MINNESOTA, NATIONAL ASSOCIATION, not in its individual capacity but solely as Indenture Trustee By: /s/ Marianna Stershic ----------------------------------- Name: Marianna C. Stershic Title: Vice President COUNTERPARTY: TOYOTA MOTOR CREDIT CORPORATION By: /s/ George E. Borst ----------------------------------- Name: George E. Borst Title: President and Chief Executive Officer S-1 -----END PRIVACY-ENHANCED MESSAGE-----