exv4w3



 






EXECUTION COPY




Exhibit 4.3



 




POOLING AND SERVICING AGREEMENT




BETWEEN




CAPITAL AUTO RECEIVABLES, INC.




AND




GENERAL MOTORS ACCEPTANCE CORPORATION




DATED AS OF FEBRUARY 16, 2006



 




 









 





TABLE OF CONTENTS




	 	 	 	 	 	 	 
	 	 	 	 	Page	 
	 
	 	 	 	 	 	 
	ARTICLE I DEFINITIONS	 	 	1	 
	 
	 	 	 	 	 	 
	SECTION 1.01
	 	Definitions.	 	 	1	 
	SECTION 1.02
	 	Owner of a Receivable.	 	 	2	 
	 
	 	 	 	 	 	 
	ARTICLE II PURCHASE AND SALE OF RECEIVABLES	 	 	2	 
	 
	 	 	 	 	 	 
	SECTION 2.01
	 	Purchase and Sale of Receivables.	 	 	2	 
	SECTION 2.02
	 	Receivables Purchase Price.	 	 	3	 
	SECTION 2.03
	 	The Closing.	 	 	3	 
	SECTION 2.04
	 	Custody of Receivable Files.	 	 	3	 
	 
	 	 	 	 	 	 
	ARTICLE III ADMINISTRATION AND SERVICING OF RECEIVABLES	 	 	4	 
	 
	 	 	 	 	 	 
	SECTION 3.01
	 	Duties of the Servicer.	 	 	4	 
	SECTION 3.02
	 	Collection of Receivable Payments.	 	 	5	 
	SECTION 3.03
	 	Rebates on Full Prepayments on Scheduled Interest Receivables.	 	 	5	 
	SECTION 3.04
	 	Realization Upon Liquidating Receivables.	 	 	5	 
	SECTION 3.05
	 	Maintenance of Insurance Policies.	 	 	6	 
	SECTION 3.06
	 	Maintenance of Security Interests in Vehicles.	 	 	6	 
	SECTION 3.07
	 	Covenants, Representations and Warranties of the Servicer.	 	 	6	 
	SECTION 3.08
	 	Purchase of Receivables Upon Breach of Covenant.	 	 	8	 
	SECTION 3.09
	 	Basic Servicing Fee; Payment of Certain Expenses by Servicer.	 	 	8	 
	SECTION 3.10
	 	Servicer’s Accounting.	 	 	8	 
	SECTION 3.11
	 	Application of Collections.	 	 	9	 
	 
	 	 	 	 	 	 
	ARTICLE IV REPRESENTATIONS AND WARRANTIES	 	 	10	 
	 
	 	 	 	 	 	 
	SECTION 4.01
	 	Representations and Warranties as to the Receivables.	 	 	10	 
	SECTION 4.02
	 	Additional Representations and Warranties of GMAC.	 	 	13	 
	SECTION 4.03
	 	Representations and Warranties of CARI.	 	 	14	 
	 
	 	 	 	 	 	 
	ARTICLE V ADDITIONAL AGREEMENTS	 	 	15	 
	 
	 	 	 	 	 	 
	SECTION 5.01
	 	Conflicts With Further Transfer and Servicing Agreements.	 	 	15	 
	SECTION 5.02
	 	Protection of Title.	 	 	15	 
	SECTION 5.03
	 	Other Liens or Interests.	 	 	15	 
	SECTION 5.04
	 	Repurchase Events.	 	 	16	 
	SECTION 5.05
	 	Indemnification.	 	 	16	 
	SECTION 5.06
	 	Further Assignments.	 	 	16	 
	SECTION 5.07
	 	Pre-Closing Collections.	 	 	16	 
	 
	 	 	 	 	 	 
	ARTICLE VI CONDITIONS	 	 	17	 
	 
	 	 	 	 	 	 
	SECTION 6.01
	 	Conditions to Obligation of CARI.	 	 	17	 
	SECTION 6.02
	 	Conditions to Obligation of GMAC.	 	 	17	 
	 
	 	 	 	 	 	 
	ARTICLE VII MISCELLANEOUS PROVISIONS	 	 	18	 
	 
	 	 	 	 	 	 
	SECTION 7.01
	 	Amendment.	 	 	18	 
	SECTION 7.02
	 	Survival.	 	 	18	 
	SECTION 7.03
	 	Notices.	 	 	18	 
	SECTION 7.04
	 	Governing Law.	 	 	18	 
	SECTION 7.05
	 	Waivers.	 	 	18	 
	SECTION 7.06
	 	Costs and Expenses.	 	 	18	 
	SECTION 7.07
	 	Confidential Information.	 	 	18	 






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	 	 	 	 	Page	 
	SECTION 7.08
	 	Headings.	 	 	18	 
	SECTION 7.09
	 	Counterparts.	 	 	19	 
	SECTION 7.10
	 	No Petition Covenant.	 	 	19	 
	SECTION 7.11
	 	Limitations on Rights of Others.	 	 	19	 
	 
	 	 	 	 	 	 
	EXHIBIT A
	 	Form of First Step Receivables Assignment	 	 	 	 
	 
	 	 	 	 	 	 
	SCHEDULE A
	 	Schedule of Receivables	 	 	 	 
	 
	 	 	 	 	 	 
	APPENDIX A
	 	Definitions, Rules of Construction and Notices	 	 	 	 
	 
	 	 	 	 	 	 
	APPENDIX B
	 	Additional Representations and Warranties	 	 	 	 






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     THIS POOLING AND SERVICING AGREEMENT, dated as of February 16, 2006, between CAPITAL AUTO
RECEIVABLES, INC., a Delaware corporation (“CARI”), and GENERAL MOTORS ACCEPTANCE
CORPORATION, a Delaware corporation (herein referred to as “GMAC” in its capacity as seller
of the Receivables and as the “Servicer” in its capacity as servicer of the Receivables).



     WHEREAS, CARI desires to purchase on the date hereof a portfolio of automobile and light truck
retail instalment sale contracts, direct purchase money loans and related rights owned by GMAC;



     WHEREAS, GMAC is willing to sell on the date hereof such contracts and related rights to CARI;



     WHEREAS, CARI may wish to sell or otherwise transfer on the date hereof such contracts and
related rights, or interests therein, to a trust, corporation, partnership or other entity (any
such entity being the “Issuer”);



     WHEREAS, the Issuer may issue debentures, notes, participations, certificates of beneficial
interest, partnership interests or other interests or securities (collectively, any such issued
interests or securities being “Securities”) to fund its acquisition of such contracts and
related rights;



     WHEREAS, the Issuer may wish to provide in the agreements pursuant to which it acquires its
interest in such contracts and related rights and issues the Securities (all such agreements,
including the Trust Sale and Servicing Agreement and the Indenture, being collectively the
“Further Transfer and Servicing Agreements”) that GMAC shall service such contracts;



     WHEREAS, the Servicer is willing to service such contracts in accordance with the terms hereof
for the benefit of CARI and, by its execution of the Further Transfer and Servicing Agreements,
will be willing to service such contracts in accordance with the terms of such Further Transfer and
Servicing Agreements for the benefit of the Issuer and each other party identified or described
herein or in the Further Transfer and Servicing Agreements as having an interest as owner, trustee,
secured party, or holder of Securities (the Issuer and all such parties under the Further Transfer
and Servicing Agreements being “Interested Parties”) with respect to such contracts, and
the proceeds thereof, as the interests of such parties may appear from time to time.



     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. Certain capitalized terms used in this Agreement are defined
in and shall have the respective meanings assigned to them in Part I of Appendix A to this
Agreement. All references herein to “the Agreement” or “this Agreement” are to
this Pooling and Servicing Agreement as it may be amended, supplemented or modified from time to



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time, and all references herein to Articles and Sections are to Articles or Sections of this
Agreement unless otherwise specified. The rules of construction set forth in Part II of such
Appendix A shall be applicable to this Agreement.



     SECTION
1.02      Owner of a Receivable. For purposes of this Agreement, the “Owner”
of a Receivable shall mean CARI until the sale, transfer, assignment or other conveyance of such
Receivable by CARI pursuant to the terms of the Further Transfer and Servicing Agreements, and
thereafter shall mean the Issuer; provided, that GMAC or CARI, as applicable, shall be the
“Owner” of any Receivable from and after the time that such Person shall acquire such
Receivable, whether pursuant to Section 3.08 or 5.04 of this Agreement, any
provision of the Further Transfer and Servicing Agreements or otherwise.



ARTICLE II

PURCHASE AND SALE OF RECEIVABLES




     SECTION 2.01      Purchase and Sale of Receivables.



                  (a)      Purchase. On the Closing Date, subject to satisfaction of the conditions
specified in Article VI and the First Step Receivables Assignment (and, in any event, immediately
prior to consummation of the related transactions contemplated by the Further Transfer and
Servicing Agreements, if any), GMAC shall sell, transfer, assign and otherwise convey to CARI,
without recourse:



                            (i)      all right, title and interest of GMAC in, to and under the Receivables listed on the
Schedule of Receivables and (A) in the case of Receivables that are Scheduled Interest Receivables,
all monies due thereunder on and after the Cutoff Date and (B) in the case of Receivables that are
Simple Interest Receivables, all monies received thereon on and after the Cutoff Date, in each
case, exclusive of any amounts allocable to the premium for physical damage insurance force-placed
by GMAC covering any related Financed Vehicle;



                            (ii)      the interest of GMAC in the security interests in the Financed Vehicles granted by
Obligors pursuant to the Receivables and, to the extent permitted by law, any accessions thereto;



                            (iii)      the interest of GMAC in any proceeds from claims on any physical damage, credit life,
credit disability or other insurance policies covering Financed Vehicles or Obligors;



                            (iv)      the interest of GMAC in any proceeds from recourse against Dealers on the Receivables;



                            (v)      all right, title and interest of the Seller in, to and under the First Step Receivables
Assignment; and



                            (vi)      the present and future claims, demands, causes and choses in action in respect of any or
all the foregoing described in clauses (i) through (v) above and all payments on or
under and all proceeds of every kind and nature whatsoever in respect of any or all the foregoing,
including all proceeds of the conversion of any or all of the foregoing,



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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, investment property, payment intangible, general intangibles, 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.



     The property described in clauses (i) through (vi) above is referred to herein
collectively as the “Purchased Property.”



                  (b)      It is the intention of GMAC and CARI that the transfer and assignment of Receivables
contemplated by this Agreement and the First Step Receivables Assignment shall constitute a sale of
the Receivables from GMAC to CARI and the beneficial interest in and title to the Receivables shall
not be part of GMAC’s estate in the event of the filing of a bankruptcy petition by or against GMAC
under any bankruptcy law.



                  (c)      The transfer and assignment of Receivables contemplated by this Agreement and the First
Step Receivables Assignment does not constitute and is not intended to result in any assumption by
CARI of any obligation of GMAC to the Obligors, Dealers, insurers or any other Person in connection
with the Receivables, any Dealer Agreements, any insurance policies or any agreement or instrument
relating to any of them.



     SECTION 2.02      Receivables Purchase Price.



     In consideration for the Purchased Property, CARI shall, on the Closing Date, pay to GMAC an
amount equal to the Initial Aggregate Receivables Principal Balance in respect of the Receivables
and GMAC shall execute and deliver to CARI an assignment in the form attached hereto as Exhibit A
(the “First Step Receivables Assignment”). The Initial Aggregate Receivables Principal
Balance, which is equal to $3,151,304,872.54 shall be paid to GMAC in immediately available funds.



     SECTION 2.03      The Closing.



     The sale and purchase of the Receivables shall take place at the offices of Kirkland & Ellis
LLP, 200 East Randolph Drive, Chicago, Illinois 60601, on the Closing Date at a time mutually
agreeable to GMAC and CARI, and will occur simultaneously with the closing of transactions
contemplated by the Further Transfer and Servicing Agreements.



     SECTION
2.04      Custody of Receivable Files. In connection with the sale, transfer and
assignment of the Receivables to CARI pursuant to this Agreement and the First Step Receivables
Assignment, CARI, simultaneously with the execution and delivery of this Agreement, shall enter
into the Custodian Agreement with the Custodian, pursuant to which CARI shall revocably appoint the
Custodian, and the Custodian shall accept such appointment, to act as the agent of CARI as
Custodian of the following documents or instruments which shall be constructively delivered to CARI
with respect to each Receivable:



                  (a)      the fully executed original of the instalment sale contract or direct purchase money loan,
as applicable, for such Receivable;



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                  (b)      documents evidencing or related to any Insurance Policy;



                  (c)      the original credit application of each Obligor, fully executed by each such Obligor on
GMAC’s customary form, or on a form approved by GMAC, for such application;



                  (d)      where permitted by law, the original certificate of title (when received) and otherwise
such documents, if any, that GMAC keeps on file in accordance with its customary procedures
indicating that the Financed Vehicle is owned by the Obligor and subject to the interest of GMAC as
first lienholder or secured party; and



                  (e)      any and all other documents that GMAC keeps on file in accordance with its customary
procedures relating to the individual Receivable, Obligor or Financed Vehicle.



ARTICLE III

ADMINISTRATION AND SERVICING OF RECEIVABLES




     SECTION
3.01      Duties of the Servicer. (a) The Servicer is hereby appointed and
authorized to act as agent for the Owner of the Receivables and in such capacity 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 hereby accepts such appointment
and authorization and agrees to perform the duties of Servicer with respect to the Receivables set
forth herein and in the Further Transfer and Servicing Agreements.



                  (b)      The Servicer’s duties shall include collection and posting of all payments, responding to
inquiries of Obligors, investigating delinquencies, sending payment coupons to Obligors, reporting
tax information to Obligors, policing the collateral, accounting for collections and furnishing
monthly and annual statements to the Owner of any Receivables with respect to distributions,
generating federal income tax information and performing the other duties specified herein.
Subject to the provisions of Section 3.02, the Servicer shall follow its customary
standards, policies and procedures and shall have full power and authority, acting alone, to do any
and all things in connection with such managing, servicing, administration and collection that it
may deem necessary or desirable.



                  (c)      Without limiting the generality of the foregoing, the Servicer is hereby authorized and
empowered by the Owner of the Receivables, pursuant to this Section 3.01, to execute and
deliver, on behalf of all Interested Parties, or any of them, any and all instruments of
satisfaction or cancellation, or of partial or full release or discharge, and all other comparable
instruments, with respect to the Receivables and the Financed Vehicles. The Servicer is hereby
authorized to commence, in its own name or in the name of the Owner of such Receivable a legal
proceeding to enforce a Liquidating Receivable as contemplated by Section 3.04, to enforce
all obligations of GMAC and CARI under this Agreement and under the Further Transfer and Servicing
Agreements or to commence or participate in a legal proceeding (including without limitation a
bankruptcy proceeding) relating to or involving a Receivable or a Liquidating Receivable. If the
Servicer commences or participates in such a legal proceeding in its own name, the Servicer is
hereby authorized and empowered by the Owner of the Receivables pursuant to this Section
3.01, to obtain possession of the related Financed Vehicle and



4









 







immediately and without further action on the part of the Owner or the Servicer, the Owner of
such Receivable shall thereupon automatically assign in trust such Receivable and the security
interest in the related Financed Vehicle to the Servicer for the benefit of the Interested Parties
for purposes of commencing or participating in any such proceeding as a party or claimant. Upon
such automatic assignment, the Servicer will be, and will have all the rights and duties of, a
secured party under the UCC and other applicable law with respect to such Receivable and the
related Financed Vehicle. At the Servicer’s request from time to time, the Owner of a Receivable
assigned under this Section 3.01 shall provide the Servicer with evidence of the assignment
in trust for the benefit of the Interested Parties as may be reasonably necessary for the Servicer
to take any of the actions set forth in the following sentence.



                  (d)      The Servicer is hereby authorized and empowered by the Owner of a Receivable 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. Any Owner of Receivables
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 and the Further Transfer and Servicing
Agreements. Except to the extent required by the preceding two sentences, the authority and rights
granted to the Servicer in this Section 3.01 shall be nonexclusive and shall not be
construed to be in derogation of the retention by the Owner of a Receivable of equivalent authority
and rights.



     SECTION
3.02      Collection 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 collection practices, policies and procedures
as it follows with respect to comparable automotive receivables that it services for itself or
others in connection therewith. Except as provided in Section 3.07(a)(iii), the Servicer
is hereby authorized to grant extensions, rebates or adjustments on a Receivable without the prior
consent of the Owner of such Receivable. The Servicer is authorized in its discretion to waive any
prepayment charge, late payment charge or any other fees that may be collected in the ordinary
course of servicing such Receivable.



     SECTION
3.03      Rebates on Full Prepayments on
Scheduled Interest Receivables. If the
amount of a full Prepayment by an Obligor under a Scheduled Interest Receivable, after adjustment
for the 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 Scheduled Interest Receivable,
either because the Rebate calculated under the terms of such 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
to the Owner of such Receivable.



     SECTION
3.04      Realization Upon Liquidating Receivables. The Servicer shall use
reasonable efforts, consistent with its customary practices, policies and 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. The Servicer is authorized to follow such customary practices,
policies and procedures as it follows with respect to comparable automotive



5









 







receivables that it services for itself or others, which customary practices, policies and
procedures may include reasonable efforts to realize upon any recourse to Dealers, selling the
related Financed Vehicle at public or private sale and other actions by the Servicer in order to
realize upon such a Receivable. The Servicer is hereby authorized to exercise its discretion
consistent with its customary practices, policies and procedures and the terms of this Agreement,
in servicing Liquidating Receivables so as to maximize the realization of those Liquidating
Receivables. The Servicer shall not be liable for any such exercise of its discretion to sell or
not to sell such Liquidating Receivables made in good faith. The foregoing is subject to the
provision that, in any case in which the Financed Vehicle shall have suffered damage, the Servicer
shall not expend funds in connection with any repair or towards the repossession of such Financed
Vehicle unless it shall determine in its discretion that such repair and/or repossession shall
increase the proceeds of liquidation of the related Receivable by an amount greater than the amount
of such expenses. The Servicer shall be entitled to receive Liquidation Expenses with respect to
each Liquidating Receivable at such time as the Receivable becomes a Liquidating Receivable (or as
may otherwise be provided in the Further Transfer and Servicing Agreements).



     SECTION
3.05      Maintenance of Insurance Policies. The Servicer shall, in accordance with
its customary practices, policies and procedures, require that each Obligor shall have obtained
physical damage insurance covering the Financed Vehicle as of the execution of the related
Receivable. The Servicer shall, in accordance with its customary practices, policies and
procedures, monitor such physical damage insurance with respect to each Receivable.



     SECTION
3.06      Maintenance of Security Interests in Vehicles. The Servicer shall, in
accordance with its customary practices, policies and 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 Owner of each Receivable hereby authorizes the Servicer to
re-perfect such security interest on behalf of such Owner, as necessary because of the relocation
of a Financed Vehicle, or for any other reason.



     SECTION
3.07      Covenants, Representations and Warranties of the Servicer. As of the
Closing Date, the Servicer hereby makes the following representations, warranties and covenants on
which CARI relies in accepting the Receivables hereunder and pursuant to the related First Step
Receivables Assignment, and on which the Issuer shall rely in accepting such Receivables and
executing and delivering the Securities under the Further Transfer and Servicing Agreements.



                  (a)      The Servicer covenants that from and after the closing hereunder:



                            (i)      Liens in Force. Except as contemplated in this Agreement or the Further Transfer
and Servicing Agreements, the Servicer shall not release in whole or in part any Financed Vehicle
from the security interest securing the related Receivable;



                            (ii)      No Impairment. The Servicer shall do nothing to impair the rights or security
interest of CARI or any Interested Party in and to the Purchased Property; and



6









 





                            (iii)      No Modifications. The Servicer shall not amend or otherwise modify any
Receivable such that the Amount Financed, the Annual Percentage Rate, the total number of Scheduled
Payments (in the case of a Scheduled Interest Receivable) or the number of originally scheduled due
dates (in the case of a Simple Interest Receivable), is altered or such that the last Scheduled
Payment (in the case of a Scheduled Interest Receivable) or the last scheduled due date (in the
case of a Simple Interest Receivable) occurs after the Final Scheduled Distribution Date.



                  (b)      Upon the execution of this Agreement and the Further Transfer and Servicing Agreements,
the Servicer represents and warrants to the Issuer and CARI that as of the Closing Date, in
addition to the representations and warranties in Sections 4.01 and 4.02 being true:



                            (i)      Organization and Good Standing. The Servicer has been duly organized and is
validly existing and in good standing under the laws of its state of incorporation, with power and
authority to own its properties and to conduct its business as such properties are presently owned
and such business is presently conducted, and had at all relevant times, and now has, power,
authority and legal right to service the Receivables as provided herein and in the Further Transfer
and Servicing Agreements;



                            (ii)      Due Qualification. The Servicer is duly qualified to do business as a foreign
corporation 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 (including
the servicing of the Receivables) requires or shall require such qualification;



                            (iii)      Power and Authority. The Servicer has the power and authority to execute and
deliver this Agreement and the Further Transfer and Servicing Agreements and to carry out the terms
of such agreements; and the Servicer’s execution, delivery and performance of this Agreement and
the Further Transfer and Servicing Agreements have been duly authorized by the Servicer by all
necessary corporate action;



                            (iv)      Binding Obligation. The Further Transfer and Servicing Agreements and this
Agreement, when duly executed and delivered, shall constitute the legal, valid and binding
obligations of the Servicer enforceable in accordance with their respective terms, except as
enforceability may be limited by bankruptcy, insolvency, reorganization, or other similar laws
affecting the enforcement of creditors’ rights in general and by general principles of equity,
regardless of whether such enforceability is considered in a proceeding in equity or at law;



                            (v)      No Violation. The consummation by the Servicer of the transactions contemplated
by this Agreement and the Further Transfer and Servicing Agreements, and the fulfillment by the
Servicer of the terms hereof and thereof, shall not conflict with, result in any breach of any of
the terms and provisions of, or constitute (with or without notice or lapse of time) a default
under, the articles of incorporation or by-laws of the Servicer, or any indenture, agreement,
mortgage, deed of trust or other instrument to which the Servicer is a party or by which it is
bound, or result in the creation or imposition of any Lien upon any of its properties pursuant to
the terms of any such indenture, agreement, mortgage, deed of trust or



7









 







other instrument, other than this Agreement and the Further Transfer and Servicing Agreements,
or 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 any of its
properties; and



                            (vi)      No Proceedings. To the Servicer’s knowledge, there are no proceedings or
investigations pending, or threatened, before any court, regulatory body, administrative agency or
other tribunal or governmental instrumentality having jurisdiction over the Servicer or its
properties (A) asserting the invalidity of this Agreement and the Further Transfer and Servicing
Agreements or any Securities issued thereunder, (B) seeking to prevent the issuance of such
Securities or the consummation of any of the transactions contemplated by the Further Transfer and
Servicing Agreements, or (C) seeking any determination or ruling that might materially and
adversely affect this Agreement, the performance by the Servicer of its obligations under, or the
validity or enforceability of, the Further Transfer and Servicing Agreements.



     SECTION
3.08      Purchase of Receivables Upon Breach of Covenant. Upon discovery by any of
the Servicer, CARI or any party under the Further Transfer and Servicing Agreements of a breach of
any of the covenants set forth in Sections 3.06 and 3.07(a), the party discovering such
breach shall give prompt written notice thereof to the others. As of the last day of the second
Monthly Period following its discovering or receiving notice of such breach (or, at the Servicer’s
election, the last day of the first Monthly Period so following), the Servicer shall, unless it
shall have cured such breach in all material respects, purchase from the Owner thereof any
Receivable materially and adversely affected by such breach as determined by such Owner and, on the
related Distribution Date, the Servicer shall pay the Administrative Purchase Payment, and shall be
entitled to receive the Released Administrative Amount, if any. It is understood and agreed that
the obligation of the Servicer to purchase any Receivable with respect to which such a breach has
occurred and is continuing shall, if such obligation is fulfilled, constitute the sole remedy
against the Servicer for such breach available to CARI or any Interested Party.



     SECTION
3.09      Basic Servicing Fee; Payment of Certain Expenses by Servicer. The Servicer
is entitled to receive the Basic Servicing Fee out of collections in respect of the Receivables and
other available funds, as and to the extent set forth in the Further Transfer and Servicing
Agreements. The Servicer shall also be entitled to Investment Earnings as, and to the extent, set
forth in the Further Transfer and Servicing Agreements. Subject to any limitations on the
Servicer’s liability under the Further Transfer and Servicing Agreements, the Servicer shall be
required to pay all expenses incurred by it in connection with its activities under this Agreement
and under the Further Transfer and Servicing Agreements (including fees and disbursements of the
Issuer, any trustees and independent accountants, taxes imposed on the Servicer, expenses incurred
in connection with distributions and reports to holders of Securities and all other fees and
expenses not expressly stated under this Agreement or the Further Transfer and Servicing Agreements
to be for the account of the holders of Securities).



     SECTION 3.10      Servicer’s Accounting. On each Determination Date under a Further
Transfer and Servicing Agreement, the Servicer shall deliver to each of the trustees and



8









 







other applicable parties under the Further Transfer and Servicing Agreements and to CARI and
the Rating Agencies a Servicer’s Accounting with respect to the immediately preceding Monthly
Period executed by the President or any Vice President of the Servicer containing all information
necessary to each such party for making any distributions required by the Further Transfer and
Servicing Agreements, and all information necessary to each such party for sending any statements
required under the Further Transfer and Servicing Agreements. Receivables to be purchased by the
Servicer under Sections 3.08 or 5.04 or to be repurchased by CARI or GMAC under the Further
Transfer and Servicing Agreements as of the last day of any Monthly Period shall be identified by
Receivable number (as set forth in the Schedule of Receivables). With respect to any Receivables
for which CARI is the Owner, the Servicer shall deliver to CARI such accountings relating to such
Receivables and the actions of the Servicer with respect thereto as CARI may reasonably request.



     SECTION 3.11      Application of Collections. For the purposes of this Agreement and the
Further Transfer and Servicing Agreements, no later than each Distribution Date all collections for
the related Monthly Period shall be applied by the Servicer as follows:



                  (a)      With respect to each Scheduled Interest Receivable (other than an Administrative
Receivable or a Warranty Receivable), payments by or on behalf of the Obligor that are not
Supplemental Servicing Fees shall be applied first to reduce outstanding advances of shortfalls in
collections, if any, made pursuant to the Further Transfer and Servicing Agreements with respect to
such Receivable. Next, the amount of any such payments that are not Supplemental Servicing Fees
and are in excess of such advances with respect to such Receivable shall be applied to the
Scheduled Payment with respect to such Receivable. Any amount of such payments remaining after the
applications described in the preceding two sentences constitutes an Excess Payment with respect to
such Receivable, and such Excess Payment (to the extent it does not constitute a Payment Ahead)
shall be applied to prepay such Receivable. If the amounts applied under the first two sentences
of this Section 3.11(a) shall be less than the Scheduled Payment, whether as a result of
any extension granted to the Obligor or otherwise, then the Deferred Prepayment, if any, with
respect to such Receivable shall be applied by the Servicer to the extent of the shortfall, and
such Deferred Prepayment shall be reduced accordingly.



                  (b)      With respect to all Simple Interest Receivables (other than Administrative Receivables and
Warranty Receivables), payments by or on behalf of the Obligors that are not Supplemental Servicing
Fees shall be applied first to the payment to the Servicer of Excess Simple Interest Collections,
if any, and next to principal and interest on all such Simple Interest Receivables.



                  (c)      With respect to a Scheduled Interest Receivable or a Simple Interest Receivable that is
also an Administrative Receivable and Warranty Receivable, payments by or on behalf of the Obligor
shall be applied in the same manner as set forth in Section 3.11(a) or Section 3.11(b), as
applicable, except that any Released Administrative Amount or Released Warranty Amount shall be
remitted to the Servicer or CARI, as applicable. In the case of a Scheduled Interest Receivable, a
Warranty Payment shall be applied first to reduce any advances described in Section
3.11(a); and then the remaining amount of such Warranty Payment or an Administrative Purchase
Payment, as applicable, shall be applied to the Scheduled Payment, in each case to the extent that
the payments by or on behalf of the Obligor shall be insufficient to



9









 







pay such amount, and then to prepay such Receivable in full. In the case of a Simple Interest
Receivable, a Warranty Payment or an Administrative Purchase Payment, as applicable, shall be
applied to principal and interest on such Receivable.



ARTICLE IV

REPRESENTATIONS AND WARRANTIES




     SECTION
4.01      Representations and Warranties as to the Receivables. GMAC makes the
following representations and warranties as to the Receivables, on which CARI relies in accepting
the Receivables. Such representations and warranties speak as of the Closing Date, and shall
survive the sale, transfer and assignment of the Receivables to CARI and the subsequent assignment
and transfer pursuant to the Further Transfer and Servicing Agreements:



                  (a)      Characteristics of Receivables.



                            (i)      General. Each Receivable:



                                     (1)      is secured by a Financed Vehicle, was originated in the United States by GMAC or one of
its subsidiaries or a Dealer for the retail sale of a Financed Vehicle in the ordinary course of
business, was fully and properly executed by the parties thereto, if not originated by GMAC, was
purchased by GMAC from one of its subsidiaries or from such Dealer under an existing Dealer
Agreement, and was validly assigned by such subsidiary or such Dealer to GMAC in accordance with
its terms,



                                     (2)      has created or shall create a valid, binding and enforceable first priority security
interest in favor of GMAC in the Financed Vehicle, which security interest is assignable by GMAC to
CARI,



                                     (3)      contains customary and enforceable provisions such as to render the rights and remedies of
the holder thereof adequate for realization against the collateral of the benefits of the security,



                                     (4)      is a Scheduled Interest Receivable or a Simple Interest Receivable,



                                     (5)      provides for level monthly payments which may vary from one another by no more than $5,
which shall amortize the Amount Financed by maturity and shall yield interest at the Annual
Percentage Rate,



                                     (6)      has an original term of not less than six months and not greater than 72 months and a
remaining term of not less than six months, and



                                     (7)      at least one monthly payment has been made.



                            (ii)      Receivables. In addition to the characteristics set forth in Section
4.01(a)(i) above, each Receivable (1) has a first scheduled payment due date on or after
December 3, 1999 (2) was originated on or after October 29, 1999 (3) as of the Cutoff Date, was not
considered past due (that is, no payments due on that Receivable in excess of $25 were more



10









 







than thirty (30) days delinquent), and was not a Liquidating Receivable and (4) has an Annual
Percentage Rate not greater than 8.85%.



                  In addition, Scheduled Interest Receivables represent (based on Principal Balances) 28.47% of
the Aggregate Amount Financed as of the Cutoff Date, with the balance of the Receivables being
Simple Interest Receivables.



                  (b)      Creation, Perfection and Priority of Security Interests. The representations and
warranties regarding creation, perfection and priority of security interests in the Purchased
Property, which are attached to this Agreement as Appendix B, are true and correct to the extent
that they are applicable;



                  (c)      Schedule of Receivables. The information set forth in the Schedule of Receivables
is true and correct in all material respects, and no selection procedures believed to be adverse to
CARI or to holders of the Securities issued under the Further Transfer and Servicing Agreements
were utilized in selecting the Receivables from those receivables of GMAC that meet the selection
criteria set forth in this Agreement;



                  (d)      Compliance With Law. All requirements of applicable federal, state and local
laws, and regulations thereunder, including, without limitation, usury laws, the Federal
Truth-in-Lending Act, the Equal Credit Opportunity Act, the Fair Credit Billing Act, the Fair
Credit Reporting Act, the Fair Debt Collection Practices Act, the Federal Trade Commission Act, the
Magnuson-Moss Warranty Act, the Federal Reserve Board’s Regulations “B” and “Z”, the Servicemembers
Civil Relief Act of 2003, the Texas Consumer Credit Code, and state adaptations of the National
Consumer Act and of the Uniform Consumer Credit Code and other consumer credit laws and equal
credit opportunity and disclosure laws, in respect of any of the Receivables and other Purchased
Property, have been complied with in all material respects, and each Receivable and the sale of the
Financed Vehicle evidenced thereby complied at the time it was originated or made and now complies
in all material respects with all legal requirements of the jurisdiction in which it was originated
or made;



                  (e)      Binding Obligation. Each Receivable represents the genuine, legal, valid and
binding payment obligation in writing of the Obligor thereon, enforceable by the holder thereof in
accordance with its terms, except as enforceability may be limited by bankruptcy, insolvency,
reorganization or similar laws affecting the enforcement of creditors’ rights in general and by
equity, regardless of whether such enforceability is considered in a proceeding in equity or at
law;



                  (f)      Security Interest in Financed Vehicle. Immediately prior to the sale, transfer
and assignment thereof pursuant hereto and the First Step Receivables Assignment, each Receivable
was secured by a validly perfected first priority security interest in the Financed Vehicle in
favor of GMAC as secured party or all necessary and appropriate action had been commenced that
would result in the valid perfection of a first priority security interest in the Financed Vehicle
in favor of GMAC as secured party;



11









 





                  (g)      Receivables In Force. No Receivable has been satisfied, subordinated or
rescinded, and the Financed Vehicle securing each such Receivable has not been released from the
lien of the related Receivable in whole or in part;



                  (h)      No Waiver. Since the Cutoff Date no provision of a Receivable has been waived,
altered or modified in any respect;



                  (i)      No Defenses. No right of rescission, setoff, counterclaim or defense has been
asserted or threatened with respect to any Receivable;



                  (j)      No Liens. To the best of GMAC’s knowledge: (1) there are no liens or claims that
have been filed for work, labor or materials affecting any Financed Vehicle securing any Receivable
that are or may be liens prior to, or equal or coordinate with, the security interest in the
Financed Vehicle granted by the Receivable; (2) no contribution failure has occurred with respect
to any Benefit Plan which is sufficient to give rise to a lien under Section 302 (f) of ERISA with
respect to any Receivable; and (3) no tax lien has been filed and no claim related thereto is being
asserted with respect to any Receivable;



                  (k)      Insurance. Each Obligor is required to maintain a physical damage insurance
policy of the type that GMAC requires in accordance with its customary underwriting standards for
the purchase of automotive receivables;



                  (l)      Good Title. No Receivable has been sold, transferred, assigned or pledged by GMAC
to any Person other than CARI; immediately prior to the conveyance of the Receivables pursuant to
this Agreement and the First Step Receivables Assignment, GMAC had good and marketable title
thereto, free of any Lien; and, upon execution and delivery of this Agreement by GMAC, CARI shall
have all of the right, title and interest of GMAC in and to the Receivables, the unpaid
indebtedness evidenced thereby and the collateral security therefor, free of any Lien;



                  (m)      Lawful Assignment. No Receivable was originated in, or is subject to the laws of,
any jurisdiction the laws of which would make unlawful the sale, transfer and assignment of such
Receivable under this Agreement, the Trust Sale and Servicing Agreement or the Indenture, as
applicable;



                  (n)      All Filings Made. All filings (including, without limitation, UCC filings)
necessary in any jurisdiction to give CARI a first priority perfected ownership interest in the
Receivables shall have been made;



                  (o)      One Original. There is only one original executed copy of each Receivable;



                  (p)      No Documents or Instruments. No Receivable, or constituent part thereof,
constitutes a “negotiable instrument” or “negotiable document of title” (as such
terms are used in the UCC); and



                  (q)      No Amendment. No Receivable has been amended or otherwise modified such that the
total number of the Obligor’s Scheduled Payments (in the case of a Scheduled



12









 







Interest Receivable) or the number of originally scheduled due dates (in the case of a Simple
Interest Receivable) has been increased or such that the Amount Financed has been increased.



     SECTION
4.02      Additional Representations and Warranties of GMAC. GMAC hereby represents
and warrants to CARI as of the Closing Date, both in its capacity as the seller of the Receivables
hereunder and in its capacity as Servicer, that:



                  (a)      Organization and Good Standing. GMAC has been duly organized and is validly
existing as a corporation in good standing under the laws of the State of Delaware, with power and
authority to own its properties and to conduct its business as such properties are presently owned
and such business is presently conducted;



                  (b)      Due Qualification. GMAC is duly qualified to do business as a foreign corporation
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 (including the servicing of
the Receivables) requires or shall require such qualification;



                  (c)      Power and Authority. GMAC has the power and authority to execute and deliver this
Agreement and the First Step Receivables Assignment and to carry out its terms; GMAC has full power
and authority to sell and assign the property to be sold and assigned to CARI and to service the
Receivables as provided herein and in the Further Transfer and Servicing Agreements, has duly
authorized such sale and assignment to CARI by all necessary corporate action; and the execution,
delivery and performance of this Agreement and the First Step Receivables Assignment have been duly
authorized by GMAC by all necessary corporate action;



                  (d)      Valid Sale; Binding Obligation. This Agreement and the First Step Receivables
Assignment, when duly executed and delivered, shall constitute a valid sale, transfer and
assignment of the Receivables, in each case, enforceable against creditors of and purchasers from
GMAC; and this Agreement together with the First Step Receivables Assignment, when duly executed
and delivered, shall constitute a legal, valid and binding obligation of GMAC enforceable in
accordance with its terms, except as enforceability may be limited by bankruptcy, insolvency,
reorganization or other similar laws affecting the enforcement of creditors’ rights in general and
by general principles of equity, regardless of whether such enforceability is considered in a
proceeding in equity or at law;



                  (e)      No Violation. The consummation of the transactions contemplated by this Agreement
and the First Step Receivables Assignment and the fulfillment of the terms of this Agreement and
the First Step Receivables Assignment shall not conflict with, result in any breach of any of the
terms and provisions of, or constitute (with or without notice or lapse of time) a default under,
the articles of incorporation or by-laws of GMAC, or any indenture, agreement, mortgage, deed of
trust or other instrument to which GMAC is a party or by which it is bound, or result in the
creation or imposition of any Lien upon any of its properties pursuant to the terms of any such
indenture, agreement, mortgage, deed of trust or other instrument, other than this Agreement and
the First Step Receivables Assignment or violate any law or, to the best of GMAC’s knowledge, any
order, rule or regulation applicable to GMAC of any court or of any



13









 







federal or state regulatory body, administrative agency or other governmental instrumentality
having jurisdiction over GMAC or any of its properties; and



                  (f)      No Proceedings. To GMAC’s knowledge, there are no proceedings or investigations
pending, or threatened, before any court, regulatory body, administrative agency or other tribunal
or governmental instrumentality having jurisdiction over GMAC or its properties (A) asserting the
invalidity of this Agreement and the First Step Receivables Assignment, (B) seeking to prevent the
consummation of any of the transactions contemplated by this Agreement and the First Step
Receivables Assignment, or (C) seeking any determination or ruling that might materially and
adversely affect the performance by GMAC of its obligations under, or the validity or
enforceability of, this Agreement and the First Step Receivables Assignment.



     SECTION
4.03      Representations and Warranties of CARI. CARI hereby represents and
warrants to GMAC as of the Closing Date:



                  (a)      Organization and Good Standing. CARI has been duly organized and is validly
existing as a corporation in good standing under the laws of the State of Delaware, with power and
authority to own its properties and to conduct its business as such properties are presently owned
and such business is presently conducted, and had at all relevant times, and now has, power,
authority and legal right to acquire and own the Receivables;



                  (b)      Due Qualification. CARI is duly qualified to do business as a foreign corporation
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 requires such
qualification;



                  (c)      Power and Authority. CARI has the power and authority to execute and deliver this
Agreement and the First Step Receivables Assignment and to carry out its terms and the execution,
delivery and performance of this Agreement and the First Step Receivables Assignment have been duly
authorized by CARI by all necessary corporate action;



                  (d)      No Violation. The consummation of the transactions contemplated by this Agreement
and the First Step Receivables Assignment and the fulfillment of the terms of this Agreement and
the First Step Receivables Assignment shall 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 certificate of incorporation or by-laws of CARI, or any indenture, agreement, mortgage, deed of
trust or other instrument to which CARI is a party or by which it is bound, or 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 any Further Transfer and Servicing Agreement
or violate any law or, to the best of CARI’s knowledge, any order, rule or regulation applicable to
CARI of any court or of any federal or state regulatory body, administrative agency or other
governmental instrumentality having jurisdiction over CARI or any of its properties; and



                  (e)      No Proceedings. To CARI’s knowledge, there are no proceedings or investigations
pending, or threatened, before any court, regulatory body, administrative agency



14









 







or other tribunal or governmental instrumentality having jurisdiction over CARI or its
properties (i) asserting the invalidity of this Agreement and the First Step Receivables
Assignment, or (ii) seeking any determination or ruling that might materially and adversely affect
the performance by CARI of its obligations under, or the validity or enforceability of, this
Agreement and the First Step Receivables Assignment.



ARTICLE V

ADDITIONAL AGREEMENTS




     SECTION
5.01      Conflicts With Further Transfer and Servicing Agreements. To the extent
that any provision of Sections 5.02 through 5.04 of this Agreement conflicts with any
provision of the Further Transfer and Servicing Agreements, the Further Transfer and Servicing
Agreements shall govern.



     SECTION 5.02      Protection of Title.



                  (a)      Filings. GMAC shall authorize and execute, as applicable, and file such financing
statements and cause to be authorized and executed, as applicable, and filed such continuation and
other statements, all in such manner and in such places as may be required by law fully to
preserve, maintain and protect the interest of CARI under this Agreement and the First Step
Receivables Assignment in the Receivables and the other Purchased Property and in the proceeds
thereof. GMAC shall deliver (or cause to be delivered) to CARI file-stamped copies of, or filing
receipts for, any document filed as provided above, as soon as available following such filing GMAC
hereby authorizes CARI and its assigns to file all such financing statements without its signature.



                  (b)      Name Change. GMAC shall not change its state of organization or its name,
identity or corporate structure in any manner that would, could or might make any financing
statement or continuation statement filed by GMAC, CARI or CARI’s assigns in accordance with
Section 5.02(a) seriously misleading within the meaning of the UCC, unless it shall have
given CARI at least sixty (60) days prior written notice thereof.



                  (c)      Executive Office; Maintenance of Offices. GMAC shall give CARI at least sixty
(60) days prior written notice of any relocation of its principal executive office if, as a result
of such relocation, the applicable provisions of the UCC would require the filing of any amendment
of any previously filed financing or continuation statement or of any new financing statement.
GMAC shall at all times maintain each office from which it services Receivables and its principal
executive office within the United States of America.



                  (d)      New Debtor. In the event that GMAC shall change the jurisdiction in which it is
incorporated or otherwise enter into any transaction which would result in a “new debtor”
(as defined in the UCC) succeeding to the obligations of GMAC hereunder, GMAC shall comply fully
with the obligations of Section 5.02(a).



     SECTION
5.03      Other Liens or Interests. Except for the conveyances hereunder and under
the First Step Receivables Assignment and as contemplated by the Further Transfer and Servicing
Agreements, GMAC shall not sell, pledge, assign or transfer the Receivables or other Purchased
Property to any other Person, or grant, create, incur, assume or suffer to exist any Lien



15









 







on any interest therein, and GMAC shall defend the right, title and interest of CARI in, to
and under such Receivables or other Purchased Property against all claims of third parties claiming
through or under GMAC.



     SECTION
5.04      Repurchase Events. By its execution of the Further Transfer and Servicing
Agreements to which it is a party, GMAC shall acknowledge the assignment by CARI of such of its
right, title and interest in, to and under this Agreement and the First Step Receivables Assignment
to the Issuer as shall be provided in the Further Transfer and Servicing Agreements. GMAC hereby
covenants and agrees with CARI for the benefit of CARI and the Interested Parties that in the event
of a breach of any of GMAC’s representations and warranties contained in Section 4.01
hereof with respect to any Receivable (a “Repurchase Event”), GMAC will repurchase such
Receivable from the Issuer (if the Issuer is then the Owner of such Receivable) on the date and for
the amount specified in the Further Transfer and Servicing Agreements, without further notice from
CARI hereunder. Upon the occurrence of a Repurchase Event with respect to a Receivable for which
CARI is the Owner, GMAC agrees to repurchase such Receivable from CARI for an amount and upon the
same terms as GMAC would be obligated to repurchase such Receivable from the Issuer if the Issuer
was then the Owner thereof, and upon payment of such amount, GMAC shall have such rights with
respect to such Receivable as if GMAC had purchased such Receivable from the Issuer as the Owner
thereof. It is understood and agreed that the obligation of GMAC to repurchase any Receivable as
to which a breach has occurred and is continuing shall, if such obligation is fulfilled, constitute
the sole remedy against GMAC for such breach available to CARI or any Interested Party.



     SECTION
5.05      Indemnification. GMAC shall indemnify CARI for any liability as a result
of the failure of a Receivable to be originated in compliance with all requirements of law. This
indemnity obligation shall be in addition to any obligation that GMAC may otherwise have.



     SECTION
5.06      Further Assignments. GMAC acknowledges that CARI may, pursuant to the
Further Transfer and Servicing Agreements, sell the Receivables to the Issuer and assign its rights
hereunder and under the First Step Receivables Assignment to the Issuer, subject to the terms and
conditions of the Further Transfer and Servicing Agreements, and that the Issuer may in turn
further pledge, assign or transfer its rights in the Receivables and this Agreement and the First
Step Receivables Assignment. GMAC further acknowledges that CARI may assign its rights under the
Custodian Agreement to the Issuer.



     SECTION
5.07      Pre-Closing Collections. Within two (2) Business Days after the Closing
Date GMAC shall transfer to the account or accounts designated by CARI (or by the Issuer under the
Further Transfer and Servicing Agreements) all collections on the Receivables held by GMAC on the
Closing Date, and conveyed to CARI pursuant to Section 2.01; provided that so long as the
Monthly Remittance Conditions are satisfied, such collections need not be transferred until the
first Distribution Date.



16









 





ARTICLE VI

CONDITIONS




     SECTION 6.01      Conditions to Obligation of CARI. The obligation of CARI to purchase the
Receivables hereunder and pursuant to the First Step Receivables Assignment is subject to the
satisfaction of the following conditions:



                  (a)      Representations and Warranties True. The representations and warranties of GMAC
hereunder shall be true and correct at the time of the Closing Date, and GMAC shall have performed
all obligations to be performed by it hereunder on or prior to the Closing Date.



                  (b)      No Repurchase Event. No Repurchase Event shall have occurred on or prior to the
Closing Date.



                  (c)      Computer Files Marked. GMAC shall, at its own expense, on or prior to the Closing
Date, indicate in its computer files created in connection with the Receivables that the
Receivables have been sold to CARI pursuant to this Agreement and the First Step Receivables
Assignment and deliver to CARI the Schedule of Receivables, certified by an officer of GMAC to be
true, correct and complete.



                  (d)      Documents to be Delivered By GMAC.



                            (i)      The Assignments. On the Closing Date, GMAC shall execute and deliver the First
Step Receivables Assignment.



                            (ii)      Evidence of UCC Filing. On or prior to the Closing Date, GMAC shall record and
file, at its own expense, a UCC-1 financing statement in each jurisdiction in which required by
applicable law, authorized by and naming GMAC as seller or debtor, naming CARI as purchaser or
secured party, naming the Receivables and the other Purchased Property as collateral, meeting the
requirements of the laws of each such jurisdiction and in such manner as is necessary to perfect
the sale, transfer, assignment and conveyance of such Receivables to CARI. GMAC shall deliver a
file-stamped copy, or other evidence satisfactory to CARI of such filing, to CARI on or prior to
the Closing Date.



                            (iii)      Other Documents. On the Closing Date GMAC shall provide such other documents as
CARI may reasonably request.



                  (e)      Other Transactions. The transactions contemplated by the Further Transfer and
Servicing Agreements shall be consummated to the extent that such transactions are intended to be
substantially contemporaneous with the transactions hereunder.



     SECTION
6.02      Conditions to Obligation of GMAC. The obligation of GMAC to sell the
Receivables to CARI hereunder or pursuant to the First Step Receivables Assignment is subject to
the satisfaction of the following conditions:



                  (a)      Representations and Warranties True. The representations and warranties of CARI
hereunder shall be true and correct as of the Closing Date with respect to the Receivables, and
CARI shall have performed all obligations to be performed by it hereunder or pursuant to the First
Step Receivables Assignment on or prior to the closing hereunder.



17









 





                  (b)      Receivables Purchase Price. On the Closing Date, CARI shall pay to GMAC the
Aggregate Receivables Principal Balance as provided in Section 2.02.



ARTICLE VII

MISCELLANEOUS PROVISIONS




     SECTION
7.01      Amendment. This Agreement may be amended from time to time (subject to any
expressly applicable amendment provision of the Further Transfer and Servicing Agreements) by a
written amendment duly executed and delivered by GMAC and CARI.



     SECTION 7.02      Survival. The representations and warranties of GMAC set forth in
Articles IV and V of this Agreement and of Servicer set forth in Section 3.07 of this
Agreement shall remain in full force and effect and shall survive the Closing Date under
Section 2.03 hereof and the closing under the Further Transfer and Servicing Agreements.



     SECTION
7.03      Notices. All demands, notices and communications upon or to GMAC or CARI
under this Agreement shall be delivered as specified in Part III of Appendix A to this
Agreement.



     SECTION
7.04      Governing Law. THIS AGREEMENT AND THE FIRST STEP RECEIVABLES ASSIGNMENT
SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW YORK,
WITHOUT REGARD TO THE PRINCIPLES OF CONFLICTS OF LAWS THEREOF OR OF ANY OTHER JURISDICTION OTHER
THAN SECTION 5-1401 OF THE NEW YORK GENERAL OBLIGATIONS LAW, AND THE OBLIGATIONS, RIGHTS AND
REMEDIES OF THE PARTIES UNDER THIS AGREEMENT SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.



     SECTION
7.05      Waivers. No failure or delay on the part of CARI in exercising any power,
right or remedy under this Agreement or the First Step Receivables Assignment shall operate as a
waiver thereof, nor shall any single or partial exercise of any such power, right or remedy
preclude any other or further exercise thereof or the exercise of any other power, right or remedy.



     SECTION
7.06      Costs and Expenses. GMAC agrees to pay all reasonable out-of-pocket costs
and expenses of CARI, including fees and expenses of counsel, in connection with the perfection as
against third parties of CARI’s right, title and interest in, to and under the Receivables and the
enforcement of any obligation of GMAC hereunder.



     SECTION
7.07      Confidential Information. CARI agrees that it shall neither use nor
disclose to any person the names and addresses of the Obligors, except in connection with the
enforcement of CARI’s rights hereunder, under the Receivables, under the Further Transfer and
Servicing Agreements or as required by law.



     SECTION
7.08      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.



18









 





     SECTION
7.09      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
7.10      No Petition Covenant. Notwithstanding any prior termination of this
Agreement, GMAC shall not, prior to the date which is one year and one day after the final
distribution with respect to the Notes to the Note Distribution Account, acquiesce, petition or
otherwise invoke or cause CARI to invoke the process of any court or government authority for the
purpose of commencing or sustaining a case against CARI under any federal or state bankruptcy,
insolvency or similar law or appointing a receiver, liquidator, assignee, trustee, custodian,
sequestrator or other similar official of CARI or any substantial part of its property, or ordering
the winding up or liquidation of the affairs of CARI.



     SECTION
7.11      Limitations on Rights of Others. The provisions of this Agreement and the
First Step Receivables Assignment are solely for the benefit of GMAC and CARI and, to the extent
expressly provided herein, the Interested Parties, 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, under, or in respect of this Agreement or any covenants, conditions or provisions
contained herein.



* * * * *




19









 





     IN WITNESS WHEREOF, the parties hereby have caused this Agreement to be executed by their
respective officers thereunto duly authorized as of the date and year first above written.



	 	 	 	 	 
	 	 	GENERAL MOTORS ACCEPTANCE CORPORATION
	 
	 	 	 	 
	 
	 	 	 	 
	 

	 	By:
	 	/s/ Carl J. Vannatter
	 

	 	 	 	 
	 

	 	Name:
	 	Carl J. Vannatter
	 

	 	Title:
	 	Director — Global Securitization
	 
	 	 	 	 
	 
	 	 	 	 
	 	 	CAPITAL AUTO RECEIVABLES, INC.
	 
	 	 	 	 
	 
	 	 	 	 
	 

	 	By:
	 	/s/ Nancy L. Bugg
	 

	 	 	 	 
	 

	 	Name:
	 	Nancy L. Bugg
	 

	 	Title:
	 	Vice President






 









 





EXHIBIT A




FORM OF

FIRST STEP RECEIVABLES ASSIGNMENT

PURSUANT TO POOLING AND SERVICING AGREEMENT




     For value received, in accordance with the Pooling and Servicing Agreement, dated as of
February 16, 2006 (the “Pooling and Servicing Agreement”), between General Motors
Acceptance Corporation, a Delaware corporation (“GMAC”), and Capital Auto Receivables,
Inc., a Delaware corporation (“CARI”), GMAC does hereby sell, assign, transfer and
otherwise convey unto CARI, without recourse, (i) all right, title and interest of GMAC in, to and
under the Receivables listed on the Schedule of Receivables attached hereto and (a) in the case of
Receivables that are Scheduled Interest Receivables, all monies due thereunder on and after the
Cutoff Date and (b) in the case of Receivables that are Simple Interest Receivables, all monies
received thereon on and after the Cutoff Date, in each case exclusive of any amounts allocable to
the premium for physical damage insurance force-placed by GMAC covering any related Financed
Vehicle; (ii) the interest of GMAC in the security interests in the Financed Vehicles granted by
Obligors pursuant to the Receivables and, to the extent permitted by law, any accessions thereto;
(iii) the interest of GMAC in any proceeds from claims on any physical damage, credit life, credit
disability or other insurance policies covering Financed Vehicles or Obligors; (iv) the interest of
GMAC in any proceeds from recourse against Dealers on the Receivables; and (v) all right, title and
interest of GMAC in, to and under the First Step Receivables Assignment; and (vi) the present and
future claims, demands, causes and choses in action in respect of any or all the foregoing
described in clauses (i), (ii), (iii), (iv), and (v) above and all payments on or under and all
proceeds of every kind and nature whatsoever in respect of any or all the foregoing, including all
proceeds of the conversion of any or all of the foregoing, 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, investment property,
payment intangible, general intangibles, 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.



     It is the intention of GMAC and CARI that the transfer and assignment of Receivables
contemplated by this First Step Receivables Assignment shall constitute a sale of the Receivables
from GMAC to CARI and the beneficial interest in and title to the Receivables shall not be part of
GMAC’s estate in the event of the filing of a bankruptcy petition by or against GMAC under any
bankruptcy law.



     The foregoing transfer and assignment of Receivables contemplated by the Pooling and Servicing
Agreement and this First Step Receivables Assignment does not constitute and is not intended to
result in any assumption by CARI of any obligation of the undersigned to the Obligors, Dealers,
insurers or any other Person in connection with the Receivables, any Dealer Agreements, any
insurance policies or any agreement or instrument relating to any of them.



     This First Step Receivables Assignment is made pursuant to and upon the representations,
warranties and agreements on the part of the undersigned contained in the



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Pooling and Servicing Agreement and is to be governed by the Pooling and Servicing Agreement.



     Capitalized terms used herein and not otherwise defined herein shall have the meaning assigned
to them in the Pooling and Servicing Agreement.



* * * * *




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     IN WITNESS WHEREOF, the undersigned has caused this First Step Receivables Assignment to be
duly executed as of February 16, 2006.



	 	 	 	 	 
	 	 	GENERAL MOTORS ACCEPTANCE CORPORATION
	 
	 	 	 	 
	 
	 	 	 	 
	 

	 	By:	 	 
	 

	 	 	 	 
	 	 	Name: Carl J. Vannatter
	 	 	Title:   Director — Global Securitization







 









 








SCHEDULE A




SCHEDULE OF RECEIVABLES




The Schedule of Receivables is

on file at the offices of:





	 	1.	 	The Indenture Trustee
	 
	 	2.	 	The Owner Trustee
	 
	 	3.	 	General Motors Acceptance Corporation
	 
	 	4.	 	Capital Auto Receivables, Inc.






 









 








APPENDIX A




Part I




               For ease of reference, capitalized terms defined herein have been consolidated with and are
contained in Part I of Appendix A to the Trust Sale and Servicing Agreement of even date herewith
among GMAC, CARI and Capital Auto Receivables Asset Trust 2006-1, as amended and supplemented from
time to time.



Part II




               For ease of reference, the rules of construction have been consolidated with and are contained
in Part II of Appendix A to the Trust Sale and Servicing Agreement of even date herewith among
GMAC, CARI and Capital Auto Receivables Asset Trust 2006-1, as amended and supplemented from time
to time.



Part III




               For ease of reference, the notice addresses and procedures have been consolidated with and are
contained in Appendix B to the Trust Sale and Servicing Agreement of even date herewith among GMAC,
CARI and Capital Auto Receivables Asset Trust 2006-1, as amended and supplemented from time to
time.




 









 








APPENDIX B




Additional Representations and Warranties





	1.	 	While it is the intention of GMAC and CARI that the transfer and assignment contemplated by
this Agreement and the First Step Receivables Assignment shall constitute sales of the
Purchased Property from GMAC to CARI, this Agreement, the Trust Sale and Servicing Agreement
and the Indenture create a valid and continuing security interest (as defined in the
applicable UCC) in the Purchased Property in favor of CARI, the Trust and the Indenture
Trustee, as applicable, which security interest is prior to all other Liens, and is
enforceable as such as against creditors of and purchasers from GMAC, CARI and the Issuer,
respectively.
	 
	2.	 	All steps necessary to perfect GMAC’s security interest against each Obligor in the property
securing the Purchased Property have been taken.
	 
	3.	 	Prior to the sale of the Purchased Property to CARI under this Agreement, the Receivables
constitute “tangible chattel paper” within the meaning of the applicable UCC.
	 
	4.	 	GMAC owns and has good and marketable title to the Purchased Property free and clear of any
Lien, claim or encumbrance of any Person.
	 
	5.	 	GMAC has caused or will have caused, within ten (10) days, the filing of all appropriate
financing statements in the proper filing office in the appropriate jurisdictions under
applicable law in order to perfect the security interest in the Purchased Property granted to
CARI hereunder, the Issuer under the Trust Sale and Servicing Agreement and the Indenture
Trustee under the Indenture.
	 
	6.	 	Other than the security interest granted to CARI pursuant to the Basic Documents, the Issuer
under the Trust Sale and Servicing Agreement and the Indenture Trustee under the Indenture
none of GMAC, CARI or the Issuer has pledged, assigned, sold, granted a security interest in,
or otherwise conveyed any of the Purchased Property. None of GMAC, CARI or the Issuer has
authorized the filing of, nor is GMAC aware of, any financing statements against GMAC, CARI or
the Issuer that include a description of collateral covering the Purchased Property other than
the financing statements relating to the security interests granted to CARI, the Issuer and
the Indenture Trustee under the Basic Documents or any financing statement that has been
terminated. GMAC is not aware of any judgment or tax lien filings against GMAC, CARI or the
Issuer.
	 
	7.	 	GMAC, as Servicer, has in its possession all original copies of the Receivables Files and
other documents that constitute or evidence the Receivables and the Purchased Property. The
Receivables Files and other documents that constitute or evidence the Purchased Property do
not have any marks or notations indicating that they have been pledged, assigned or otherwise
conveyed to any Person other than CARI.