Document:

exhibit4_9.htm

EXHIBIT 4.9

 

FORM OF REVOLVING LIQUIDITY NOTE AGREEMENT

 

TOYOTA AUTO RECEIVABLES [______]-[_] OWNER TRUST

 

as Issuer

 

and

 

TOYOTA MOTOR CREDIT CORPORATION

 

as Initial Holder

 

 

Dated as of [_______________]

 

REVOLVING LIQUIDITY NOTE AGREEMENT (this “Agreement”) dated as of [_______________] (this “Agreement”), by and between TOYOTA AUTO RECEIVABLES [______]-[_] OWNER TRUST, a Delaware business trust, as issuer (the “Issuer”) of the revolving liquidity note (the “Revolving Liquidity Note”) issued hereunder, and TOYOTA MOTOR CREDIT CORPORATION, a California corporation (“TMCC”), as the initial holder of the Revolving Liquidity Note.

 

W I T N E S S E T H:

 

WHEREAS Toyota Auto Receivables [______]-[_] Owner Trust is issuing the Toyota Auto Receivables [______]-[_] Owner Trust $ [______] [_]% Asset Backed Notes, Class A-1, the Toyota Auto Receivables [______]-[_] Owner Trust $ [______] [_]% Asset Backed Notes Class A-2, the Toyota Auto Receivables [______]-[_] Owner Trust $[______] [_]% Asset Backed Notes, Class A-3 and the Toyota Auto Receivables [______]-[_] Owner Trust $[______] [_]% Asset Backed Notes Class A-4 (collectively, the “Notes”) pursuant to the Indenture dated as of [____________](as amended and supplemented from time to time, the “Indenture”), between the Issuer and the Indenture Trustee;

 

WHEREAS the Issuer desires to enter into a credit and liquidity enhancement arrangement that will provide funding for certain required payments of principal and interest on the Notes in the event that Available Collections and any amounts on deposit in the Reserve Account that are available to be paid in respect thereof to Noteholders on any Payment Date are insufficient to fund such payments;

 

WHEREAS TMCC is willing to provide such credit and liquidity enhancement on the terms described herein against delivery to it of the Revolving Liquidity Note evidencing the obligation of the Issuer to repay amounts so funded on the terms set forth herein and in the Revolving Liquidity Note;

 

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:

 

Article I

 

Definitions

 

Capitalized terms used herein and not defined herein shall have the meanings ascribed thereto in the Sale and Servicing Agreement dated as of [_________], among the Issuer, TMCC, as servicer, and TAFR LLC, as seller (the “Sale and Servicing Agreement”).

 

Article II

 

Funding by Holder of Revolving Liquidity Note

 

Section 2.1. General Funding Obligation.  Pursuant to Section 5.06(b) of the Sale and Servicing Agreement, on each Determination Date, the Servicer shall calculate the amount, if any, by which the amounts to be distributed in respect of interest on or principal of the Notes pursuant to Sections 5.06(c)(ii) and (iii) or 5.06(d)(ii) or (iii) of the Sale and Servicing Agreement exceed the amount of Available Collections that will be available to make such payments and will determine whether amounts on deposit in the Reserve Account, if any, that are available therefor will be sufficient to fund such payments on the related Payment Date.  If, in accordance with the Sale and Servicing Agreement, the Servicer notifies the Indenture Trustee on behalf of the Issuer that it has determined that Available Collections and amounts on deposit in the Reserve Account that will be available to make such payments will be insufficient therefor, then the Indenture Trustee on behalf of the Issuer will have the right to request the holder of the Revolving Liquidity Note (the “Holder”) to fund such shortfall (such request, or any request for funding described in Section 2.2 hereof, a “Draw”); provided that the Holder will not be obligated to fund any such shortfall to the extent that the aggregate of the amounts funded by it hereunder and not previously repaid equals or exceeds $[_________] (the parties hereto agreeing that interest accrued on the Revolving Liquidity Note as described herein will not be considered an amount funded by the Holder for purposes of such calculation).  The “Undrawn Amount” of the Revolving Liquidity Note is an amount equal to $[_________] less an amount equal to the aggregate of all amounts funded pursuant to any previous Draw Requests (as defined in Section 2.3) that have not yet been repaid pursuant to Section 2.4 (the parties hereto agreeing that interest accrued on the Revolving Liquidity Note as described herein will not be considered an amount funded by the Holder for purposes of such calculation, and any amount paid in respect of such accrued interest will not be considered to increase the Undrawn Amount).

 

Section 2.2. Additional Funding Obligations.  If at any time prior to the Final Payment Date either (i) the short-term unsecured debt rating of TMCC falls below [__] by [____] or [__] by [___] (or in either case, such lower ratings as may be permitted by [______] and [___]), or (ii) the Holder fails to fund the amount specified in any Draw Request prepared and submitted to the Holder in accordance with Sections 2.1 and 2.3 of this Agreement, then the Indenture Trustee on behalf of the Issuer will have the right to request that the entire Undrawn Amount of the Revolving Liquidity Note be funded.  To the extent the entire Undrawn Amount is fully funded pursuant to this Section 2.2, the Undrawn Amount shall be reduced to zero and shall no longer be subject to draws.

 

Section 2.3. Draw Mechanics.  Not fewer than two Business Days prior to the relevant Payment Date, in the case of a Draw described in Section 2.1, and on any Business Day, in the case of a Draw described in Section 2.2, the Issuer, by action of the Indenture Trustee or of the Administrator on behalf of the Indenture Trustee (following the assignment of this Agreement to the Indenture Trustee pursuant to Section 2.5 and until the Indenture terminates in accordance with its provisions), may deliver a written request (each such request, a “Draw Request”) for funds in the amount of the shortfall described in Section 2.1 or the entire Undrawn Amount in the case of a Draw pursuant to Section 2.2.  Any such Draw Request may be delivered by facsimile transmission and hard copy to: Toyota Motor Credit Corporation, (310) 468-5715, Attn: Vice President, Treasury, Re: Toyota Auto Receivables 200_-_ Owner Trust Revolving Liquidity Note Draw Request.  Not later than 2:00 p.m.  on the Business Day following delivery of any Draw Request, the Holder will fund the indicated draw by wire transfer of immediately available funds to the following account:

 

ABA No.:

BFN:

A/C:

For further credit to:

Attn:

 

Section 2.4. Repayment of Funded Draws.  Subject to the following sentences, the Issuer is obligated to repay all funded Draws together with interest accrued on the daily outstanding balance of all funded Draws from the date made until the date all funded Draws are repaid at [___]% per annum, calculated daily on the basis of a year of 365 or 366 days, as applicable.  The parties hereto (and the assignees and third-party beneficiaries hereof, by accepting the assignment of this Agreement as contemplated in Section 2.5 hereof) agree that Draws will be repaid in part or in whole on any each succeeding Payment Date on which amounts are available therefor in accordance with the provisions of Section 5.06(c)(v) or 5.06(d)(iv) of the Sale and Servicing Agreement, and interest accrued on the daily outstanding amount of funded Draws will be payable on and after the Payment Date on which all funded Draws are repaid and on which amounts are available therefore in accordance with the provisions of Section 5.06(c)(vi) or 5.06(d)(v) of the Sale and Servicing Agreement.  Payments to the Holder in respect of funded Draws or accrued interest will be made either by (i) netting by TMCC of amounts that would be repayable on any Payment Date to the extent amounts would be available therefor in accordance with the provisions of Section 5.06(c)(v) and (vi) or 5.06(d)(iv) and (v) of the Sale and Servicing Agreement against amounts it is otherwise required to deposit into the Collection Account in its capacity as Servicer in accordance with Section 5.04(f) of the Sale and Servicing Agreement, or by wire transfer of immediately available funds to the following account:

 

ABA No.

A/C No.

A/C

 

Notwithstanding the foregoing, if following liquidation of the Owner Trust Estate pursuant to Article IX of the Indenture the Trust has insufficient funds to make required payments to the Holder of the Revolving Liquidity Note pursuant to Article V of the Sale and Servicing Agreement, then all amounts due under the Revolving Liquidity Note will be deemed to have been paid in full and this Agreement shall terminate with no further payment owing from the Trust.

 

Section 2.5. Assignment; Third Party Beneficiaries.  The parties hereto acknowledge and agree that the right to receive amounts funded by the Holder under the Revolving Liquidity Note and all other rights of the Issuer under this Agreement will be assigned by the Issuer to the Indenture Trustee pursuant to the Indenture for the benefit of the Noteholders, and that the Indenture Trustee, on behalf of the Noteholders, and such Noteholders, are intended to be third-party beneficiaries of this Agreement from and after such assignment and until the Indenture is terminated in accordance with its terms.  In addition, the Holder expressly acknowledges that, pursuant to the Indenture, the Indenture Trustee will exercise its right to request funds hereunder in every circumstance when such request may be made in accordance with the terms of this Agreement.  Nothing in this Agreement or in the Revolving Liquidity Note, whether express or implied, shall be construed to give to any other Person any legal or equitable right, remedy or claim under or in respect of this Agreement or the Revolving Liquidity Note, or any covenants, conditions or provisions contained herein or therein.

 

Article III

 

Revolving Liquidity Note

 

Section 3.1. Issuance of Revolving Liquidity Note.  On the date hereof, the Issuer will execute and deliver to the Holder, and the Owner Trustee will authenticate, a physical certificate evidencing the Revolving Liquidity Note, substantially in the form of Exhibit A hereto.  Each Revolving Liquidity Note issued hereunder will evidence the repayment obligations of the Issuer set forth in Section 2.4 hereof and the funding obligations of the Holder thereof set forth in Section 2.1 and 2.2 hereof, and will be dated the date of its issuance.

 

Section 3.2. Upon issuance, the Undrawn Amount of the Revolving Liquidity Note shall be $[_________].  The Undrawn Amount will be reduced by the amount of each Draw funded by the Holder, and increased by amounts repaid to the Holder pursuant to Section 2.4 up to a maximum of $[_________], excluding interest paid on the Revolving Liquidity Note.  Interest will accrue on the average daily outstanding excess of $[_________] over the Undrawn Amount from and including the date of any Draw to but excluding the date on which the Undrawn Amount is reduced to zero.  Although the Revolving Liquidity Note is secured by the Owner Trust Estate ([excluding assets of the Sub-Trust as defined in the Amended and Restated Trust Agreement of the Issuer]), all payments in respect of funded Draws and interest accrued thereon shall be fully subordinated to required payments to the Noteholders and to required deposits into the Reserve Account as set forth in the Sale and Servicing Agreement.

 

Section 3.3. Transfer.  Prior to the termination of the Indenture, the Holder may not transfer, assign or convey the Revolving Liquidity Note or this Agreement unless: (i) the purported transferee, assignee or recipient of such conveyance has executed a written agreement to be bound by all of the terms and provisions of this Agreement; (ii) 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; and (iii) the Rating Agency Condition is satisfied.  The Revolving Liquidity Note may not be transferred, assigned or conveyed in part; any transfer, conveyance or assignment must be in respect of 100% of the Revolving Liquidity Note.  The Issuer (or the Administrator on behalf of the Issuer) will maintain a register in which it will record the name and contact information for each Holder.  No transfer, assignment or conveyance of the Revolving Liquidity Note will be effective prior to notice to the Issuer and the Indenture Trustee and recordation by the Issuer (or the Administrator on behalf of the Issuer) thereof in such register.

 

Section 3.4. No Set-Off.  Without affecting the provisions of this Agreement requiring the calculation of payment amounts, all payments under this Agreement will be made without set-off [or counterclaims against payments to or from the Swap Counterparty under the [Interest Rate Swap Agreement or other Basic Documents] or payments owing to the Servicer under the Basic Documents, and the parties hereto waive any right of set-off or counterclaim that any such party may have at law or equity.

 

Article IV

 

Miscellaneous Provisions

 

Section 4.1. Fees and Expenses.  No party shall receive fees or expenses in connection with this Agreement.

 

Section 4.2. Assignment by Issuer.  The Holder 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 to and/or the assignment of any or all of the Issuer’s rights and obligations hereunder to the Indenture Trustee.

 

Section 4.3. Amendment.  Prior to the termination of the Indenture, this Agreement may be amended by the Issuer and the Holder, with the consent of the Indenture Trustee, but without the consent of any of the Noteholders or the Certificateholders, 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 Certificateholders; provided, however, that (i) such action shall not, as evidenced by an Opinion of Counsel delivered to the Indenture Trustee, adversely affect in any material respect the interests of any Noteholder or Certificateholder, and (ii) the Rating Agency Condition is satisfied.  After the termination of the Indenture, this Agreement may be amended in writing by the Issuer and the Holder without notice to or consent of any other Person.

 

Section 4.4. Notices.  All demands, notices, communications and instructions upon or to the Issuer, the initial Holder, the Owner Trustee or the Indenture Trustee 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 initial Holder, 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 Issuer or the Owner Trustee, at the Corporate Trust Office (as defined in the Trust Agreement), (c) in the case of the Indenture Trustee, at the Corporate Trust Office specified in the Indenture, (d) in the case of Moody’s, to Moody’s Investors Service, [_________], (f) in the case of Standard & Poor’s, to Standard & Poor’s, a division of The McGraw-Hill Companies, [_________]; or, as to each of the foregoing, at such other address as shall be designated by written notice to the other parties.

 

Section 4.5. Holder’s Nonpetition Covenant.

 

Notwithstanding any prior termination of this Agreement, the Holder will not, prior to the date which is one year and one day after the termination of this Agreement with respect to the Issuer or Seller, 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 or Seller 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 Seller or any substantial part of the property of either of them, or ordering the winding up or liquidation of the affairs of the Issuer or Seller.

 

Section 4.6. 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 Holder’s knowledge, threatened, against or affecting the Holder: (i) asserting the invalidity of this Agreement or the Revolving Liquidity Note, (ii) seeking to prevent the issuance of the Revolving Liquidity Note or 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 Holder of its obligations under, or the validity or enforceability of, this Agreement, or (iv) relating to the Holder and which might adversely affect the federal income tax attributes of the Issuer or the Revolving Liquidity Note.

 

Section 4.7. 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 4.8. Termination.  This Agreement shall terminate upon the termination of the Amended and Restated Trust Agreement pursuant to Article IX of the Amended and Restated Trust Agreement.

 

Section 4.9. 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.

 

Section 4.10. 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 4.11. Limitation on Liability.  Notwithstanding anything contained herein to the contrary, this Agreement has been countersigned by [_________], not in its individual capacity, but solely in its capacity as Owner Trustee on behalf of the Issuer.  In no event shall [_________] 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 Holder, or prepared by the Holder for delivery 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.

 

Section 4.12. 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.

 

[Remainder of this page intentionally left blank]

 

  

  

  

IN WITNESS WHEREOF, the Issuer and the initial Holder have caused this Agreement to be duly executed by their respective officers as of the day and year first above written.

 

	
TOYOTA AUTO RECEIVABLES [___]-[_] OWNER TRUST, as Issuer

	  
	  
	
By:   _______________________,  not  in

	
 its individual  capacity but solely in

	
 its capacity as Owner Trustee

	  
	  
	
By:           ______________________________

	
Name:

	
Title:

	  
	
TOYOTA MOTOR CREDIT CORPORATION, as Holder

	  
	  
	  
	
By:           ______________________________

	
Name:

	
Title:

  

  

  

EXHIBIT A

 

FORM OF REVOLVING LIQUIDITY NOTE

 

THIS REVOLVING LIQUIDITY NOTE HAS NOT BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “1933 ACT”), OR THE SECURITIES LAWS OF ANY STATE OR OTHER JURISDICTION IN RELIANCE ON EXEMPTIONS PROVIDED BY THE 1933 ACT AND SUCH STATE OR FOREIGN SECURITIES LAWS.  NO RESALE OR OTHER TRANSFER OF THIS REVOLVING LIQUIDITY NOTE SHALL BE MADE EXCEPT IN COMPLIANCE WITH SECTION 3.3 OF THE REVOLVING LIQUIDITY NOTE AGREEMENT AND EITHER (i) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE 1933 ACT OR (ii) IN A TRANSACTION EXEMPT FROM THE REGISTRATION REQUIREMENTS OF THE 1933 ACT AND APPLICABLE STATE AND FOREIGN SECURITIES LAWS.

 

THE PRINCIPAL OF THIS REVOLVING LIQUIDITY NOTE IS PAYABLE SOLELY FROM FUNDS AVAILABLE THEREFOR PURSUANT TO ARTICLE V OF THE SALE AND SERVICING AGREEMENT REFERRED TO HEREIN.  THE HOLDER HEREOF IS REQUIRED TO FUND CERTAIN DRAWS REQUESTED BY THE ISSUER HEREOF (OR BY CERTAIN OTHER PERSONS REFERRED TO HEREIN) UP TO A MAXIMUM PRINCIPAL AMOUNT OUTSTANDING AT ANY TIME OF $[_________].  THE OUTSTANDING PRINCIPAL AMOUNT OF THIS REVOLVING LIQUIDITY NOTE AT ANY TIME MAY BE LESS THAN SUCH MAXIMUM AMOUNT.  REPAYMENT OF THE OUTSTANDING PRINCIPAL AMOUNT OF THIS REVOLVING LIQUIDITY NOTE, AND OF INTEREST ACCRUED HEREON, IS SUBJECT TO THE AVAILABILITY OF FUNDS FOR SUCH PURPOSE AS SET FORTH IN ARTICLE V OF THE SALE AND SERVICING AGREEMENT REFERRED TO HEREIN, AND IS FULLY SUBORDINATED TO THE PAYMENT OF INTEREST ON AND PRINCIPAL OF CERTAIN OTHER SECURITIES ISSUED BY THE ISSUER HEREOF AND TO THE DEPOSIT INTO THE RESERVE ACCOUNT REFERRED TO HEREIN OF AMOUNTS REQUIRED TO BE DEPOSITED THEREIN.

 

THIS REVOLVING LIQUIDITY NOTE IS NOT AN OBLIGATION OF, AND WILL NOT BE INSURED OR GUARANTEED BY, ANY GOVERNMENTAL AGENCY, TOYOTA MOTOR CREDIT CORPORATION, TOYOTA AUTO FINANCE RECEIVALBES LLC, THE OWNER TRUSTEE, THE INDENTURE TRUSTEE OR ANY OF THEIR RESPECTIVE AFFILIATES.

 

THIS REVOLVING LIQUIDITY NOTE, OR A BENEFICIAL INTEREST HEREIN, MAY NOT BE TRANSFERRED UNLESS THE TRUSTEE HAS RECEIVED (I) A CERTIFICATE FROM THE TRANSFEREE TO THE EFFECT THAT SUCH TRANSFEREE IS NOT AN EMPLOYEE BENEFIT PLAN, TRUST OR ACCOUNT SUBJECT TO TITLE I OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED (“ERISA”), OR SUBJECT TO SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE “CODE”), OR A GOVERNMENTAL PLAN DEFINED IN SECTION 3(32) OF ERISA OR SECTION 414(d) OF THE CODE SUBJECT TO ANY FEDERAL, STATE OR LOCAL LAW WHICH IS, TO A MATERIAL EXTENT, SIMILAR TO THE FOREGOING PROVISIONS OF ERISA OR THE CODE (EACH, A “BENEFIT PLAN”) AND IS NOT AN ENTITY INCLUDING AN INSURANCE COMPANY SEPARATE ACCOUNT OR AN INSURANCE COMPANY GENERAL ACCOUNT IF THE ASSETS IN ANY SUCH ACCOUNTS CONSTITUTE “PLAN ASSETS” FOR PURPOSES OF REGULATION SECTION 2510.3-101 OF ERISA WHOSE UNDERLYING ASSETS INCLUDE BENEFIT PLAN ASSETS BY REASON OF A BENEFIT PLAN’S INVESTMENT IN THE ENTITY AND (II) A CERTIFICATE TO THE EFFECT THAT IF THE TRANSFEREE IS A PARTNERSHIP, GRANTOR TRUST OR S CORPORATION FOR FEDERAL INCOME TAX PURPOSES (A “FLOW-THROUGH ENTITY”), ANY REVOLVING LIQUIDITY NOTES OWNED BY SUCH FLOW-THROUGH ENTITY WILL REPRESENT LESS THAN 50% OF THE VALUE OF ALL THE ASSETS OWNED BY SUCH FLOW-THROUGH ENTITY AND NO SPECIAL ALLOCATION OF INCOME, GAIN, LOSS, DEDUCTION OR CREDIT FROM SUCH REVOLVING LIQUIDITY NOTES WILL BE MADE AMONG THE BENEFICIAL OWNERS OF SUCH FLOW-THROUGH ENTITY.

 

IN ADDITION, NO RESALE OR OTHER TRANSFER OF THIS REVOLVING LIQUIDITY NOTE OR ANY INTEREST THEREIN SHALL BE PERMITTED UNLESS IMMEDIATELY AFTER GIVING EFFECT TO SUCH RESALE OR OTHER TRANSFER, THERE WOULD BE FEWER THAN 100 REVOLVING LIQUIDITY NOTEHOLDERS.

 

  

  

  

TOYOTA AUTO RECEIVABLES OWNER TRUST [____]-[_]

 

REVOLVING LIQUIDITY NOTE

 

Representing a

Maximum Amount of Funded Draws

outstanding at any time not to exceed

$[_________]

 

This certifies that TOYOTA MOTOR CREDIT CORPORATION (the “Holder”) is the registered owner of this Revolving Liquidity Note representing the right to receive the payment of certain Draws funded as described in the Revolving Liquidity Note Agreement (the “Revolving Liquidity Note Agreement”) dated as of [_________], between Toyota Auto Receivables Owner Trust [_____]-[_], as issuer (the “Issuer”) and Toyota Motor Credit Corporation as initial holder hereof.  Capitalized terms used herein and not defined herein shall have the meanings ascribed thereto in the Revolving Liquidity Note Agreement and in the Sale and Servicing Agreement dated as of [_________], among the Issuer, Toyota Motor Credit Corporation (“TMCC”), as servicer, and TAFR LLC, as seller (the “Sale and Servicing Agreement”).

 

This Revolving Liquidity Note represents a 100% undivided interest in the right of the Holder to receive repayment in full of the aggregate amount of funded Draws and interest accrued thereon as and to the extent such amounts are payable in accordance with the Revolving Liquidity Note Agreement.  All of the provisions of the Revolving Liquidity Note Agreement and Sale and Servicing Agreement are incorporated by reference and comprise integral parts of this Revolving Liquidity Note.  The following summary of certain provisions thereof is not and does not purport to be complete.  By its acceptance hereof, the holder of this Revolving Liquidity Note (the “Holder”) assents to and is bound by the terms, provisions and conditions of the Revolving Liquidity Note Agreement, including the provisions thereof (i) setting forth the obligation of the Holder of this Revolving Liquidity Note to fund Draws as and when properly requested pursuant to Article II thereof, (ii) specifying that this Revolving Liquidity Note is secured only by certain assets of the Issuer and is payable only from certain collections in respect thereof that are available for such purpose in accordance with the priority of payments set forth in Article V of the Sale and Servicing Agreement, and (iii) specifying that all payments in respect of funded Draws and interest accrued thereon shall be fully subordinated to required payments to the holders of certain other securities issued by the Issuer and to required deposits into a specified reserve account established for the benefit of the holders of such other securities in accordance with the Sale and Servicing Agreement.

 

The “Undrawn Amount” of the Revolving Liquidity Note is an amount equal to $[_________] less an amount equal to the aggregate of all amounts funded pursuant to any previous Draw Requests that have not yet been repaid pursuant to Section 2.4 of the Revolving Liquidity Note Agreement, and increased by amounts repaid to the Holder pursuant to Section 2.4 of the Revolving Liquidity Note Agreement up to a maximum of $[_________] (interest accrued on the Revolving Liquidity Note not being considered an amount funded by the Holder for purposes of such calculation, and any amount paid in respect of such accrued interest will not be considered to increase the Undrawn Amount).  To the extent the entire Undrawn Amount is fully funded pursuant to Section 2.2 of the Revolving Liquidity Note Agreement, the Undrawn Amount shall be reduced to zero and shall no longer be subject to draws.  Interest will accrue on the average daily outstanding excess of $[_________] over the Undrawn Amount from and including the date of any Draw to but excluding the date on which the Undrawn Amount is reduced to zero at [____]% per annum, calculated daily on the basis of a year of 365 or 366 days, as applicable.

 

Subject to the more detailed provisions concerning payments to be made to the Holder of the Revolving Liquidity Note set forth in the Revolving Liquidity Note Agreement and the Sale and Servicing Agreement, generally, repayment of Draws previously funded by the (or a) Holder of the Revolving Liquidity Note, and interest accrued thereon as described below, will be made on the 15th day of each calendar month, or if such day is not a Business Day, then on the next succeeding Business Day, to the extent funds are available therefor.  Notwithstanding the foregoing, if following liquidation of the Owner Trust Estate pursuant to Article IX of the Indenture the Trust has insufficient funds to make required payments to the Holder of the Revolving Liquidity Note pursuant to Article V of the Sale and Servicing Agreement, then all amounts due under the Revolving Liquidity Note will be deemed to have been paid in full and this Agreement shall terminate with no further payment owing from the Trust.

 

Prior to the termination of the Indenture, this Agreement may be amended by the Issuer and the Holder, with the consent of the Indenture Trustee, but without the consent of any of the Noteholders or the Certificateholders, 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 Certificateholders; provided, however, that (i) such action shall not, as evidenced by an Opinion of Counsel delivered to the Indenture Trustee, adversely affect in any material respect the interests of any Noteholder or Certificateholders, and (ii) the Rating Agency Condition is satisfied.  After the termination of the Indenture, this Agreement may be amended in writing by the Issuer and the Holder without notice to or consent of any other Person.

 

Prior to the termination of the Indenture, the Holder may not transfer, assign or convey this Revolving Liquidity Note or the Revolving Liquidity Note Agreement unless: (i) the purported transferee, assignee or recipient of such conveyance has executed a written agreement to be bound by all of the terms and provisions of the Revolving Liquidity Note Agreement; (ii) 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 Certificateholders; and (iii) the Rating Agency Condition is satisfied.  The Revolving Liquidity Note may not be transferred, assigned or conveyed in part; any transfer, conveyance or assignment must be in respect of 100% of this Revolving Liquidity Note.  The Issuer (or the Administrator on behalf of the Issuer) will maintain a register in which it will record the name and contact information for each Holder.  No transfer, assignment or conveyance of this Revolving Liquidity Note will be effective prior to notice to the Issuer and the Indenture Trustee and recordation by the Issuer (or the Administrator on behalf of the Issuer) thereof in such register.

 

No recourse may be taken, directly or indirectly, with respect to the obligations of the Holder of this Revolving Liquidity Note under the Revolving Liquidity Note Agreement 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, 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.

 

By its acceptance of this Revolving Liquidity Note, the Holder agrees that it will not, prior to the date which is one year and one day after the termination of the Revolving Liquidity Note Agreement with respect to the Issuer or Seller, 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 or Seller 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 Seller or any substantial part of the property of either of them, or ordering the winding up or liquidation of the affairs of the Issuer or Seller.

 

THIS REVOLVING LIQUIDITY NOTE SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE STATE OF CALIFORNIA.

 

  

  

  

IN WITNESS WHEREOF, the Issuer has caused this Revolving Liquidity Note to be duly executed.

 

	
TOYOTA AUTO RECEIVABLES [___]-[_] OWNER TRUST, as Issuer

	  
	  
	  
	  
	
By:  _____________________, 

        not  in its individual  capacity but solely 

        in its capacity as Owner Trustee

	  
	  
	  
	
       By:           ____________________________________

	
Name:

	
Title:

	  
	  
	
Dated:  [_________]

  

  

  

EXHIBIT B

 

FORM OF REVOLVING LIQUIDITY NOTE DRAW REQUEST

 

Toyota Auto Receivables [____]-[_] Owner Trust

c/o ___________________

[Address]

 

Toyota Motor Credit Corporation

19001 South Western Avenue

Torrance, California  90509

Attn: Vice President, Treasury

Facsimile: (310) 468-5715

 

	
Re:   Toyota Auto Receivables [____]-[_] Owner Trust Revolving Liquidity Note Draw Request

Ladies and Gentlemen:

 

This notice confirms the Issuer’s request for a draw on the Revolving Liquidity Note pursuant to Section [2.1] [2.2] of the Revolving Liquidity Note Agreement in the principal amount of $[_________].  Please advance the requested drawn amount as set forth in Section 2.3 of the Revolving Liquidity Note Agreement.

 

Please acknowledge receipt of this notice by executing below and returning to the above-listed address.

 

	
Very truly yours,

	  
	
[Administrator] [Indenture Trustee]

	  
	  
	  
	
By:           ___________________________________

	
Name:

	
Title:

	  
	  
	
ACKNOWLEDGED:

	
Toyota Motor Credit Corporation

	  
	  
	  
	
By:           ___________________________________

	
Name:

	
Title:form8k091010ex10-1.htm

PROPERTY OPTION AGREEMENT

This Mining Property Option Agreement (" Option") is made to be effective as of the

10 th day of September, 2010 (the "Effective Date"), between Zsolt Rosta, whose mailing address is 4212 Juniper Creek Road, Reno, Nevada 89519, Jennifer Oliver whose mailing address is 1417 Orca Way , Reno, Nevada  89506,  and Genesis Gold Corporation, a Utah corporation, whose mailing address is 1527 East Princeton Salt Lake City, Utah 84105 (collectively the “Optionor”) and Dakota Gold Corp. (currently known as Coastline Corporate Services, Inc.), a Nevada Corporation, whose mailing address is 701 N. Green Valley Road, Suite 200, Henderson, NV 89074 (the “Optionee”).

RECITALS

A.            Optionor is the owner of record possessory title to the unpatented mining claims located in Nye County, Nevada, which are more particularly described on Exhibit A hereto (the "Mining Property").

B.           Optionor, subject to the Net Smelter Royalty (“NSR) reserved to the Optionor, now wishes to grant to the Optionee the exclusive right and option to acquire an undivided 100% right, title and interest in and to the Mining Property on the terms and conditions hereinafter set forth.

AGREEMENT

NOW, THEREFORE, in consideration of the premises and the mutual promises and covenants herein, Optionor and Optionee agree as follows:

1.            Option

Optionor hereby options to Optionee all of the Mining Property together with all (i) surface rights, easements and rights-of way incident or appurtenant to such Mining Property to the extent Optionor may lawfully grant the same, (ii) mining, mineral and water rights incident or appurtenant to such Mining Property, (iii) any improvements or fixtures on such property that are or may be useful or convenient for mining, milling, and beneficiation of ores and minerals and related uses, and (iv) mineral interests now and hereafter acquired by Optionor in the Mining Property.

2.           Term

The primary term of this Option shall commence on the effective date and will continue for twenty (20) years and thereafter for so long as Optionee is continuing to make payments as provided in Section 3 below, unless earlier terminated as set forth herein.

Property Option Agreement:  Dakota/Genesis/Rosta 2010

  

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3.            Option Payments and Work Commitments

             a.       Concurrently with the execution of this Option, Optionee has made a payment to Optionor in the amount of $5,000, receipt of which is acknowledged by Optionor. Unless this Option is terminated as provided herein, Optionee shall make additional Mining Property Option payments to Optionor as follows:

	
i.

	
$20,000 on or before January 1, 2011; and

	
ii.

	
$25,000 on or before September 1, 2011; and

	
iii.

	
$35,000 on or before September 1, 2012; and

	
iv.

	
$50,000 on or before September 1, 2013; and

	
v.

	
$100,000 on or before September 1, 2014; and

	
vi.

	
$100,000 on or before September 1, 2015; and

	
vii.

	
$100,000 on or before September 1, 2016; and

	
viii.

	
$100,000 on or before September 1, 2017; and

	
viv.

	
$165,000 on or before September 1, 2018; and

	
x.

	
$200,000 on or before September 1, 2019; and

	
xi.

	
$200,000 on or before September 1, 2020; and

	
xii.

	
$200,000 on or before September 1, 2021; and

	
xiii.

	
$200,000 on or before September 1, 2022; and

	
xiv.

	
$200,000 on or before September 1, 2023; and

	
xv.

	
$300,000 on or before September 1, 2024.

                         b.       Optionor requests that Option payments be specifically distributed

as follows by separate checks:  50% of due payment allocated to Genesis Gold Corp  at 1527 E. Princeton,  Salt Lake City, Utah  84105    and 50% of due payment to  Zsolt Rosta – Rosta  Mining Ventures  at 4212 Juniper Creek Rd., Reno, Nevada 89519.   This is per internal agreement between all individual optionors.

	
c.

	
During Option years 3 through 7, Optionee shall expend at least $50,000 for the benefit of the Mining Property.  It is understood that expenditures on adjoining properties within the Area of Interest shall be included in the allowable annual expenditures.  Any moneys expended during an Option year in excess of the work commitment for that period shall be credited in favor of Optionee to cover Optionee’s subsequent work commitment obligations. In the event that the Optionee does not expend the required $50,000 in any given year, then at the sole discretion of the Optionee, the Optionee may pay the Optionor a cash payment in the amount of the difference between amounts expended on the Mining Property and $50,000.

Property Option Agreement:  Dakota/Genesis/Rosta 2010

  

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d.           Following which the Optionee shall be deemed to have exercised the Option (the “Exercise Date”) and shall be entitled to an undivided 100% right, title and interest in and to the Property with the full right and authority to equip the Property for production and operate the Property as a mine subject to the rights of the Optionor to receive the NSR

e.           The Mining Property may be purchased at any time for $2,000,000 (the “Purchase Payment”) less all option payments made previously, pursuant to Section 3.a, paid by the Optionee, at which time the Option is deemed to have been exercised by the Optionee and all rights and title to the Mining Property, subject only to the royalty provisions set forth herein will have passed to the Optionee.

4.            Royalty

a.           A Royalty based on “Net Smelter Return” percentage rate shall be paid to the Optionor by the Optionee on gold, silver and platinum group metals mined from the Mining Property and sold or processed by or for the benefit of Optionee based on a sliding scale as follows:

Average monthly p.m. London gold fix

 

US$ per ounce                                                                Net Smelter Return

 

Below $1200                                                                        1.50%

 

$ 1200.01 and above                                                          3.00%

 

b.           The Royalty percentage rate for base metals and industrial minerals shall be 1.5% of the net profits realized by Optionee for the consumption, sale, or use of base metals or industrial minerals. The Royalty purchase option set forth in section 4 .a, shall not apply to Royalties resulting from base metals or industrial minerals.

 

c.            As used in this Option the term "Net Smelter Returns" shall mean the amount received by Optionee from any smelter, refinery, reduction works, mint or other purchaser in payment for "Products" mined from the Mining Property and sold and delivered, less "Allowable Deductions." If such Products are being shipped to a smelter or other treatment facility owned and/or operated by Optionee, Net Smelter Returns as defined herein on which Royalty is calculated shall be no less favorable to Optionor than if such Products had been shipped to the nearest smelter, which would accept the same.

d.            As used in this   Option the term "Allowable Deductions" shall mean, to the extent borne by Optionee:

i.            Sales, severance and other similar taxes and duties (but excluding any taxes on net income); and

Property Option Agreement:  Dakota/Genesis/Rosta 2010

  

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ii.            Charges for and taxes on transportation from the mine, or if   Option Substances are processed, the plant producing the concentrates or other saleable products, to the place of sale; and

iii.            Insurance and security costs and charges; and

iv.            Smelting, refining, and other treatment charges or costs incurred subsequent to concentrating; and

v.            Representation, assaying, and umpire costs and fees; and

vi.            Marketing costs and commissions.

e.            As used in this Option "Product" means Option Substances at their highest point of beneficiation on the Mining Property.

f.            All Royalty payments shall be computed and paid to Optionor on or before thirty (30) days following the close of the calendar month during which Optionee shall have received payment for Product sold by Optionee, or in the case of gold and silver, thirty (30) days after the month gold and silver is refined and made available to Optionee. At the time of making each such payment, Optionee shall deliver to Optionor a statement showing the amount of such Royalty and the manner in which it was determined. All records relating to the calculation of production for such Royalty shall be available for inspection by Optionor or an authorized representative of Optionor for the purpose of confirming the accuracy of such statements. Any such inspection shall be for a reasonable length of time during regular business hours, and with no greater than seventy-two (72) hours advance notification required to be given by Optionor to Optionee preceding an Inspection. Any complaint, notice to inspect, or objection which Optionor may wish to raise with respect to Royalty payable hereunder shall be made by Optionor to Optionee in writing within one (1) year after the end of the calendar month in which such payment was paid to Optionor or in which credit was applied against Royalty. Any complaint, notice to inspect or objection not timely made by Optionor shall be deemed to have been waived by Optionor.

g.            Credit shall be cumulatively allowed against any Royalty otherwise payable to Optionor for any all Advance Minimum Royalty payments paid by Optionee to Optionor hereunder and not previously recovered as credits against Royalty.

           h.                     All payments hereunder shall be delivered to Optionor in the manner and at the addresses for notices stated in Sections 3.b. and 19.a. The date of placing such payment in the regular United States mail by Optionee addressed to such address shall be the date of such payment.

Property Option Agreement:  Dakota/Genesis/Rosta 2010

  

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i.            If at any time Optionor decides to transfer all or any of Optionor’s interest in the property then Optionor shall promptly notify Optionee and Optionee shall, have thirty (30) days from the date that Optionee receives notice to notify Optionor that Optionee elects to acquire the offered interest at the same price or its monetary equivalent and on the same terms and conditions as described in Optionor’s notice.  If Optionee fails to notify Optionor of its intent within thirty (30) days then Optionor shall have thirty (30) days following the expiration of such period to consummate transfer to a third party at a price upon terms no less favorable to Optionor than those offered by Optionor to Optionee in Optionor’s notice.  If Optionor fails to transfer its royalty interest within the period described in this section then Optionee’s preferential right to acquire such offered interest shall be deemed to be revived.

5.           Transfer of Title

Upon Optionee’s completion of all requirements to earn a 100 percent interest in the Mining Property, the Optionor will deliver or cause to be delivered to the Optionee’s solicitors a duly executed transfer of Mining Property in favor of the Optionee (the “Optionee Transfer”). The Optionee shall be entitled to record the Optionee Transfer with the appropriate government offices to effect transfer of legal title of the Mining Property into its own name upon the full and complete exercise of the Option by the Optionee. In the event the Optionee Transfer is recorded the Optionor shall be entitled to record notice of its NSR interest.

6.            Exclusive Possession

Optionee shall have exclusive possession and quiet enjoyment of the Mining Property while this Option is in effect, subject to such rights provided to Optionor herein.

7.            Optionor's Representations, Covenants, and Warranties

Optionor represents and warrants to Optionee as follows:

a.           Optionor is in exclusive possession of and owns good and marketable possessory title to the Mining Property (subject only to the paramount title of the United States) free of all liens, claims, and encumbrances.

b.            Optionor has full and complete authority to execute this   Option and grant the rights herein conferred, and doing so does not violate any of the organizational documents of Optionor or of any agreement by which Optionor is bound.

Property Option Agreement:  Dakota/Genesis/Rosta 2010

  

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c.            All claim maintenance and other applicable fees with respect to the Mining Property that are due by September 1, 2010 have been paid.

 

 

	
                        c-1.

	
An exception is presented by the special case where claim maintenance is satisfied by proof of annual labor – applicable specifically to the WIN and EAU Claims set forth in Exhibit A.  The required work on these claims was completed for assessment year 2009-2010 and the proper small miner fee waiver document filed for each claim group with BLM.  The actual filing of the proof of labor documents  for these claims is still pending. Once they are filed with appropriate agencies and fees paid, Optionor will furnish such proof to Optionee.

d.            Optionor promptly shall provide Optionee with all data and information related to title to the Mining Property and Optionor shall furnish copies of all unrecorded documents related thereto in Optionor's possession or control.

e.            Optionor promptly shall make available to Optionee for copying and general use all hydrological, geological, geophysical and engineering data and maps, logs of drill holes, cuttings and cores, gamma and other logging results, assay, sampling and similar data concerning the Mining Property in Optionor’s possession or control.

f.            Optionor has no actual knowledge of any environmental problem or condition which exists on the Mining Property as of the date of execution of this   Option, including, but not limited to (i) the existence of any release of any hazardous substance on or within the Mining Property, (ii) any condition which constitutes a violation of the Comprehensive Environmental Response, Compensation and Liability Act, the Resource Conservation and Recovery Act, the Clean Air Act, the Clean Water Act, or any applicable federal, state, or local environmental law, rule or regulation, or (iii) the existence of any surface or subsurface disturbance which has not been properly reclaimed or restored pursuant to any applicable laws, rules, regulations or orders of any federal or state or governmental agency or body (hereinafter collectively referred to as an "Environmental Condition").  Optionor covenants and agrees with Optionee that Optionor shall be responsible for any Environmental Condition on the Mining Property or any reclamation obligation with respect thereto existing as of the Effective Date.

f-1.            One exception to paragraph 7f is the existence of un-reclaimed roads (approximately 5,100 feet) and un-reclaimed drill sites and sumps (approximately 30) remaining from work conducted by Palladon Ventures and Maestro Ventures in 2007.  Palladon and Maestro have accepted responsibility for reclaiming this disturbance; further, a bond for $33,000 is in place to satisfy the funding for reclamation of this disturbance.

Property Option Agreement:  Dakota/Genesis/Rosta 2010

  

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g.            Optionor has received no notification from any local, state or federal governmental agency or body that any Environmental Condition may exist upon the Mining Property.

8.            Operating Rights

Optionor grants Optionee access to the Mining Property and the exclusive rights:

a.            To explore, develop and mine, and to extract, remove, store or dispose of any and all  Option Substances from the Mining Property by means of underground or surface mining operations or workings in or on the Mining Property and to deposit on the Mining Property all such  Option Substances from the Mining Property;

b.            To carry on crushing, screening, milling, heap leaching, treatment, processing, beneficiating, smelting and refining operations on or in the Mining Property with respect to ores, minerals and other  Option Substances from the Mining Property, including existing tailings, wastes and dumps;

c.            To use any part of the Mining Property for stockpiles, tailings, waste dumps and leach pads and for any other purpose incident to mining, milling, processing and other operations on the Mining Property;

d.            To erect or construct, use and maintain on the Mining Property such roads, impoundments, pipelines, power lines, facilities, building, structures, machinery and equipment as Optionee may require for the conduct of its operations on the Mining Property;

e.            To stockpile, inventory or sell or otherwise dispose of Option Substances and Products in such forms at such times and on such terms as Optionee may determine;

    f.              To commingle  Option Substances from the Mining Property with ores and minerals from other lands for the purpose of practical, efficient and economic mining, provided however, Optionee shall maintain a means of accurately calculating the Royalty due to the Optionor with respect to such commingled  Option Substances; and

	
  

	 

g.            To stockpile any ore or product mined or produced from the Mining Property at such place or places as Optionee may elect either upon the Mining Property or upon any other lands owned or controlled by Optionee.

Property Option Agreement:  Dakota/Genesis/Rosta 2010

  

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9.            Optionee's Representations, Covenants and Warranties

a.            Optionee shall keep the title to the Mining Property free and clear of liens and encumbrances resulting from its operations hereunder, provided that Optionee may refuse to pay any claims asserted against it which it disputes in good faith.

b.            Optionee shall comply with all applicable federal, state, and local laws, rules, regulations, and ordinances.

c.            Optionee shall hold Optionor harmless from all liability, obligation, demands, claims, or damages relating to the injury or death of any person or damage to property arising out of the negligent acts or omissions of Optionee.

d.            Optionee shall conduct all operations on the Mining Property in accordance with Optionee's good faith business judgment and good mining practices. Optionee may use or employ any and all such methods of exploration, development, mining, and processing as Optionee may determine and may, when it deems it necessary or desirable, temporarily suspend or permanently discontinue operations. Optionee shall not have any obligation to begin or prosecute mining operations on the Mining Property, to mine or remove all or any portion of the minerals therein, or once commenced, to continue the same, and there shall be no implied covenants whatsoever to do so.

e.            All determinations with respect to: (a) whether ore will be beneficiated, processed or milled by Optionee or sold in a raw state, (b) the methods of beneficiating, processing or milling any such ore, (c) the constituents to be recovered therefrom, and (d) the purchasers to whom any Option Substances of Products may be sold, shall be made in Optionee's sole and absolute discretion.

f.           Except as otherwise provided in Section 7.f, Optionee shall reclaim the Mining Property in compliance with all applicable statutes, regulations and other provisions of this Option with regard to Optionee's activities on the Mining Property. Such reclamation may be complied with promptly after termination of the Option, and Optionee shall have access to the Mining Property without cost after termination of this Option in order to satisfy such obligations. No termination of this Option will relieve Optionee of its obligation to reclaim or restore disturbance caused by Optionee's exploration or development activities on the Mining Property in full compliance with applicable law.

g.            Optionee shall keep full and accurate records of all operations conducted on the Mining Property, including drilling records, maps, and assays.  Said records, or copies thereof, shall be kept in the vicinity of the Mining Property or elsewhere in the Western United States; at Optionee's option.

Property Option Agreement:  Dakota/Genesis/Rosta 2010

  

8

  

h.            Not later than March 1 following the end of each calendar year, Optionee shall provide Optionor with an annual report, without warranty, of all activities and operations conducted on or with respect to the Mining Property during the preceding calendar year.

i.            Upon termination of its  Option, Optionee shall furnish Optionor within a reasonable time and without warranty or liability one set of copies of all available data generated from work on the Mining Property.  If Optionee should vacate claim holdings in the area to the limits of the Area of Interest stated (defined in 14, below), then Optionee shall similarly furnish one set of copies of all available data from such lands as surround the Mining Property.  The nature of this data is to include but not necessarily be limited to air photos, geochem or assay data, sample maps, geologic maps and cross sections, reports, geophysical and petrographic reports, and drill logs.  Optionee shall authorize Optionor to also take possession of any available physical materials to include drill cuttings, core, and sample pulps obtained from the Mining Property and its surroundings as per above condition.

10.            Optionor's Rights

Optionor and their authorized agents, at Optionor's sole risk and expense, shall have the right, exercisable during regular business hours and upon reasonable notification to Optionee, to go on the Mining Property and in Optionee's facilities for the purpose of confirming that Optionee is conducting its operations in the manner required by this Option.

11.            Taxes

Optionee shall timely reimburse Optionor upon presentation of paid tax bills or other proof of payment for all real property taxes on the Mining Property accruing while this Option is in effect but taxes for the periods in which this  Option begins and ends shall be apportioned. Optionee shall pay all taxes on Optionee's operations and on all personal property, fixtures and improvements placed on the Mining Property by Optionee. All taxes shall be paid before becoming delinquent, but neither party shall be under any obligation to pay any tax while contesting it in good faith. Optionee shall have the right, but not the obligation, to pay any taxes, delinquency charges, late fees or penalties which could become a lien or encumbrance on the Mining Property if Optionor fails to do so and to recover amounts so paid from Optionor.

Property Option Agreement:  Dakota/Genesis/Rosta 2010

  

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12.            Relocation and Amendment of Mining Claims; Changes in Mining Law; Claim Maintenance

a.            Optionee, in the name of Optionor, shall have the right, but not the obligation, to amend the locations of any one or more of the mining claims constituting the Mining Property for the purpose of eliminating interior gaps, and Optionor agrees to promptly execute any documents necessary for that purpose. If the location of any of such mining claims was, for any reason defective, Optionee shall have the right, but shall not be required, to relocate such defective mining claim or claims in the name of Optionor for the purpose of curing such defect; relocating to be at Optionee's expense.

b.            In the event that the Mining Law of 1872, as amended, should be repealed or further amended or superseded by a new law, Optionee shall, during the term of this Option, in the name and on behalf of Optionor, take such action as Optionee may deem necessary or advisable to preserve the present rights of the parties hereto in the Mining Property or to replace such claims or rights with new claims or rights to the extent permitted by law. Any such action so taken by Optionee shall be at its own expense. Optionor hereby consent to Optionee's taking such action in respect of the Mining Property, and Optionor shall, upon request of Optionee, execute such documents and take such actions as may be required in confirmation or support of the consent herein given.

c.            While this Option is in effect Optionee shall timely perform such assessment work or pay such claim maintenance fees as may be required by then applicable laws and regulations in order to keep the Mining Property in good standing.

13.           Default and Termination

a.          Optionee shall have the right to terminate this Option as to all or any portion of the Mining Property at any time by giving Optionor written notice of such termination and paying to Optionor Royalty, if any, as may have accrued under the Option. Upon termination by Optionee under this section as to all of the Mining Property, Optionee shall have no further obligations under this Option with respect to the Mining Property, or to any portion thereof, to which such termination applies.

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b.            Should Optionee default in the performance of any of its obligations under this  Option (other than the obligation to pay Advance Minimum Royalty or Royalty when due) and having been given written notice of such default by Optionor, fail promptly to commence, and then to prosecute diligently, such measures as are appropriate for the curing of the default, or should Optionee in any event fail to cure the default as nearly as possible within sixty (60) days or such longer period as may reasonably be required after having been given such notice thereof, then in such event, Optionor shall have the right to terminate this  Option and all of Optionee's rights under the  Option, by giving to Optionee written notice of such termination. Should Optionee default in the payment of Advance Minimum Royalty or Royalty when due and, after having been given written notice of such default, fail to make such payment within twenty (20) days after such notice is given, Optionor shall have the right to effect such termination by giving to Optionee written notice thereof.  Any termination under this Section 13.b shall be without prejudice to any claim that Optionor may have for damages or other legal or equitable relief against Optionee.

 

          c.    Should either party default in the performance of this  Option, or any of the covenants, terms or conditions herein contained, then such party shall pay all costs and expenses, including reasonable attorneys' fees, incurred by the non-defaulting party in enforcing this  Option or any remedies provided herein.

 

	
  

	
c-1.

	
If Optionee has provided notice of termination after June 30 of any year, then Optionee shall be responsible for payment and filing of all annual claim maintenance fees, documents, and notices for that given year.

 

           14.                      Area of Interest

 

If the Optionor acquires, directly or indirectly or pursuant to any third party agreement, any form of interest in minerals located wholly or in part within the Area of Interest, such interest in minerals will be deemed to form a part of the Mining Property under this Agreement.  For the purposes of this agreement “Area of Interest” shall mean that area within 1 mile of the exterior perimeter of the Mining Property more exactly described in Exhibit A.

15.           Assignment

During the Option Term, both parties shall have the right to sell, transfer, assign, mortgage, pledge its interest in this Agreement or its right or interest in the Mining Property. It will be a condition of any assignment under this Agreement that such assignee shall agree in writing to be bound by the terms of this Agreement applicable to the assignor.

Property Option Agreement:  Dakota/Genesis/Rosta 2010

  

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16.            Force Majeure

a.            In the event Optionee is rendered unable, wholly or in part, by an event of force majeure to carry on its obligations under this Option (other than the obligation to pay money when due), it is agreed that such obligations of Optionee, so far as they are affected by such event, shall be suspended during the continuance of any inability so caused; and that the various periods and terms provided for herein shall be extended for a period equivalent to such period of disability. Optionee will promptly notify Optionor of the occurrence of an event of force majeure.

b.            As used in this  Option "force majeure" means any cause beyond Optionee's reasonable control, whether or not foreseeable, including but not limited to: law, regulation, action or inaction of government, inability to obtain on terms acceptable to Optionee any public or private license, permit or authorization which may be required for operations in connection with the Mining Property, including removal and disposal of waters, wastes and tailing, and reclamation; market and other conditions rendering the prospects for exploitation of the Mining Property unprofitable or uneconomic; mining casualty; damage to or destruction of mine or mill plant or facility; fire or explosion; inclement weather or flood; civil commotion; labor dispute; inability to obtain workmen or material; delay in transportation; and acts of God.

17.            Arbitration

In the event of any dispute between the parties hereto arising under or in respect of the proper interpretation of this Option or as to whether or not Optionee has defaulted in the performance of any of its obligations hereunder, such dispute shall be settled by arbitration in accordance with the provisions of this Section 14 and the Commercial Arbitration Rules of the American Arbitration Association. The place of arbitration shall be Reno, Nevada.  Within thirty (30) days after demand for arbitration is made, each party hereto shall appoint an arbiter and within twenty (20) days thereafter the two arbiters so appointed shall appoint a third arbiter. The arbiters so appointed shall proceed expeditiously with the arbitration. The decision or award of the majority of the arbiters shall be binding and conclusive on each party hereto and may be entered as a judgment in any court of competent jurisdiction. The arbiters shall, as part of their decision, assess the costs of the arbitration (other than attorneys' fees) equitably, in their discretion, in whole or in part against either party hereto. The pendency of such arbitration shall not excuse either party hereto from proceeding with the performance of each party's obligations under this Option unless the majority of the arbiters order suspension of such performance. If the occurrence of any default on the part of Optionee should be a subject of arbitration and the arbiter or a majority of the arbiters should decide that such default did in fact occur, Optionee shall have the period of grace provided for above in Section 12.b hereof to cure such default after the date of the rendering of the arbiters' decision.

Property Option Agreement:  Dakota/Genesis/Rosta 2010

  

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18.           Confidentiality    

The parties hereto agree to hold in confidence all information obtained in confidence in respect of the Mining Property or otherwise in connection with this Agreement other than in circumstances where a party has an obligation to disclose such information in accordance with applicable securities legislation, in which case such disclosure shall only be made after consultation with the other party.

19.            Miscellaneous

a.            All notices and other communications to either party shall be in writing and delivered personally or sent by prepaid certified mail, return receipt requested, recognized overnight courier, or telecopy with hard copy via prepaid mail. Notices shall be effective upon receipt. All notices and other communications shall be addressed as follows:

If to Optionee:

Dakota Gold Corp.

701 N. Green Valley Parkway

Suite 200

Henderson, NV 89074

Attn: Daulat Nijjar

If to Optionor:

Zsolt Rosta

Rosta Mining Ventures

4212 Juniper Creek Road

Reno, Nevada   89519

And to:

Genesis Gold Corp.

1527 E. Princeton Ave

Salt Lake City, UT 84105

Either party may, by notice to the other, change its address for notice.

b.            This Option supersedes all prior understandings between the parties hereto and constitutes the entire Option between them in respect of the subject matter hereof. No amendment or modification of any of the provisions of this Option shall be binding upon the parties hereto unless in writing, signed by an authorized representative of the party to be bound.

Property Option Agreement:  Dakota/Genesis/Rosta 2010

  

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c.            No failure on the part of either party hereto to give notice of any default on the part of the other party hereto shall be deemed to constitute a waiver of such default, and no waiver of any default shall be deemed to constitute a waiver of any prior or subsequent default.

d.            The captions preceding the text of each Section hereof are for convenience only and shall be disregarded in the construction of this Option.

e.            This Option shall inure to the benefit of, and shall be binding upon, the respective successors and assigns of Optionor and Optionee.

f.            This Option shall be construed in accordance with the Law of the State of Nevada. If any provision of this Option is or becomes void or unenforceable by force of law, the other provisions shall remain valid and enforceable.

g.            This Option has been negotiated between the parties at arm's length. The sole relationship between the Optionor and Optionee is the Option.  Nothing in this Option shall be construed to create between the parties, expressly or by implication, any partnership, tax partnership, joint enterprise, relationship of trust and confidence or other special relationship, or any relationship of master and servant or principal and agent, or the like.

h.            At either party's request, the other party shall execute and deliver a memorandum form of this Option suitable for recording purposes and any further instruments, agreements, or documents reasonably required to effectuate the purposes of this Option.

i.            Each signatory to this Option warrants that such person is authorized to execute this Option on behalf of the entity for which that person is signing.

 j.            This Option may be executed in counterparts, each of which constitute an original, but all of which together shall constitute one and the same instrument.

Property Option Agreement:  Dakota/Genesis/Rosta 2010

  

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IN WITNESS WHEREOF, the parties have executed this Option effective as of the Effective Date.

By

Optionor:

       ________________________                                                                _____________

Zsolt Rosta                                         Date

                                            _______________________                                                                                                ___________

Jennifer Oliver                                        Date

 

 

 

 

 

 

                                          __________________________    ____________

                                                       John E. Zimmerman                 Date

                                                       Genesis Gold Corp.

By

Optionee:

Dakota Gold Corp.

(currently known as Coastline Corporate Services, Inc.)

             _______________________       _________

                                                      Daulat Nijjar                         Date

                                                         President and CEO

                                                    Dakota Gold Corporation

Property Option Agreement:  Dakota/Genesis/Rosta 2010

  

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Exhibit   A:    Caldera Project Claims

Nye County, Nevada

Rosta  Group

EAU Claims - Owner: Jennifer [Rosta] Oliver                                     WIN Claims -Owner:  Zsolt  Rosta

BLM - NMC #                                                                           BLM - NMC #

813994  EAU #  1                                                                           813647                       WIN  #  1

813995  EAU #  2                                                                           813648                       WIN  #  2

813996  EAU #  3                                                                           813649                       WIN  #  3

813997  EAU #  4                                                                           813650                       WIN  #  4

813998  EAU #  5                                                                           813651                       WIN  #  5

813999  EAU #  6                                                                           813652                       WIN  #  6

814000  EAU #  7                                                                           813653                       WIN  #  7

Total   7  Claims                                                                           813654                       WIN  #  8

813655                       WIN  #  9

813656                       WIN  # 10

              Total    10 Claims

Genesis  Gold  Corp.  Group

 CD  Claims    -   Owner:   Genesis Gold Corp

 BLM - NMC #                                                                              BLM - NMC #

842988                      CD  61                                                                870405    CD 15

842989                      CD  63                                                                870423    CD 33

842990                      CD  65                                                                870424    CD 34

842992                      CD  71                                                                870432    CD 64

842993                      CD  72                                                                870438    CD 76

842995                      CD  74                                                                870440    CD 78

842996                      CD  83                                                                

842997                      CD  85                                                                Total    15  Claims

870403                      CD  13

 

 

Property Option Agreement:  Dakota/Genesis/Rosta 2010

 

16

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00178-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00178-of-00352.parquet"}]]