Class B Reserve Account. (a) In order to effectuate the subordination provided for herein and to assure that sufficient amounts to make required distributions to the Certificateholders will be available, there shall be established and maintained with the Trustee an Eligible Account entitled "Class B Reserve Account--Long Beach Acceptance Auto Grantor Trust 1998-1" (the "Class B Reserve Account"), which will include the money and other property deposited and held therein pursuant to Sections 4.6(c)(vii) and (x) and this Section 4.7. The Class B Reserve Account shall not be part of the Trust, but instead will be held by the Trustee in a securities account maintained for the Trustee by the Collateral Agent, constituting a security entitlement thereto, for the benefit of the Class B Certificateholders. The Originator, the Depositor, the Trustee and, by its acceptance of a Class B Certificate, each Class B Certificateholder, each acknowledge that solely for federal and other tax purposes, the Class B Certificateholders and the Excess Cash Flow Certificateholder shall be deemed to own interests in a partnership the assets of which consist of the Spread Account and the Class B Reserve Account (and any investment earnings thereon). Each Class B Certificateholder and the Holder of the Excess Cash Flow Certificate, by their acceptance thereof, agrees to treat the Spread Account, the Class B Reserve Account and the rights to releases from the Trust into such accounts (including any investment earnings derived therefrom) the same as such partnership's assets for federal income tax purposes. The Excess Cash Flow Certificateholder, by its acceptance of an Excess Cash Flow Certificate, further acknowledges that any distributions received pursuant to clause (D) of the last paragraph of Section 4.6(c) are pursuant to such partnership arrangement. (b) On the Closing Date, the Depositor shall deposit the Class B Reserve Account Initial Deposit into the Class B Reserve Account. On each Subsequent Transfer Date, the Depositor shall deposit the related Class B Reserve Account Subsequent Deposit into the Class B Reserve Account. In addition, the Depositor may replace a portion of the amount deposited in the Class B Reserve Account with a letter of credit to be provided to the Depositor's affiliate, AMC, by a banking institution whose long-term debt obligations are rated at least "Aa" by Moody's, in an amount equal to the amount to be withdrawn from the Class B Reserve Account by the Depositor to effect such substitution (such letter of credit, the "Letter of Credit"). The Depositor's ability to substitute such Letter of Credit for a portion of the amount deposited in the Class B Reserve Account shall be subject to the following conditions precedent: (i) delivery by the Depositor to the Trustee, the Rating Agencies and the Certificate Insurer of an Opinion of Counsel, in form and substance acceptable to the Certificate Insurer, in its sole discretion, and (ii) receipt of written confirmation from Moody's that the rating of the Class B Certificates will not be qualified, modified or withdrawn. In the event that the Letter of Credit is delivered to the Trustee and substituted for a portion of the amount on deposit in the Class B Reserve Account and all conditions precedent thereto have been satisfied, the Trustee shall, upon written request from the Depositor, release the substituted portion of the amount on deposit in the Class B Reserve Account to the Depositor. (i) In order to give effect to the subordination provided for herein and assure availability of the amounts maintained in the Class B Reserve Account, the Depositor, as initial Holder of the Excess Cash Flow Certificate, on behalf of itself, its successors and assigns, and all future Excess Cash Flow Certificateholders by their acceptance of an Excess Cash Flow Certificate, hereby sells, conveys and transfers to the Collateral Agent and its successors and assigns, the Class B Reserve Account Initial Deposit and all proceeds thereof, and hereby pledges to the Collateral Agent and its successors and assigns, for the benefit of the Trustee, all amounts deposited in or credited to the Class B Reserve Account from time to time under this Agreement, all Eligible Investments made with amounts on deposit therein, all earnings and distributions thereon and proceeds thereof, subject, however, to the limitations set forth below, and solely for the purpose of securing and providing for payment of Class B Distributable Amounts, Class B Interest Carryover Shortfalls, Class B Principal Carryover Shortfalls, Class B Additional Interest Distributable Amounts and Class B Additional Interest Carryover Shortfalls, in each case to the extent provided in Section 4.6 66 (all the foregoing, subject to the limitations set forth below, being the "Class B Reserve Account Property"), to have and to hold all the aforesaid property, rights and privileges unto the Collateral Agent its successors and assigns, for the benefit of the Trustee, in trust for the uses and purposes, and subject to the terms and provisions, set forth in this Section. The Collateral Agent on behalf of the Trustee hereby acknowledges such transfer and accepts the trusts hereunder and shall hold and distribute the Class B Reserve Account Property in accordance with the terms and provisions of this Section. (ii) Consistent with the limited purposes for which such trust is granted on each Distribution Date, the amounts on deposit in the Class B Reserve Account shall be available for distribution as provided in Section 4.6, in accordance with and subject to the following: if the amount on deposit in the Class B Reserve Account (after giving effect to all deposits thereto and withdrawals therefrom on such Distribution Date) is greater than the Specified Class B Reserve Account Balance, the Trustee shall release and distribute such excess to the Excess Cash Flow Certificateholder pursuant to clause (E) of the last paragraph of SECTION 4.6(c). Upon termination of this Agreement, any remaining amounts in the Class B Reserve Account will be distributed to the Excess Cash Flow Certificateholder and will constitute a termination of the partnership that owns the Spread Account (including any sub-accounts therein) and the Class B Reserve Account. Upon any such distribution to the Excess Cash Flow Certificateholder, the Class A Certificateholders and Class B Certificateholders will have no further rights in, or claims to, such amounts. (c) Amounts held in the Class B Reserve Account shall be invested in Eligible Investments which shall mature no later than the Business Day immediately preceding the next Distribution Date in accordance with written instructions from the Depositor and such investments shall not be sold or disposed of prior to their maturity. All such investments shall be deemed to be made at the direction of the Trustee and shall be made for the benefit of the Trustee, and all income and gain realized thereon shall be solely for the benefit of the Depositor subject to the security interest of the Trustee created under SECTION 4.7(b)(ii). Realized losses, if any, on investment of the Class B Reserve Account Property shall be charged first against undistributed investment earnings attributable to the Class B Reserve Account Property. The Trustee, the Depositor, as initial Holder of the Excess Cash Flow Certificate, on behalf of itself, its successors and assigns, and all future Excess Cash Flow Certificateholders by their acceptance of an Excess Cash Flow Certificate, agree that: (i) any Class B Reserve Account Property that is held in deposit accounts shall be held solely in the name of the Collateral Agent. Each such deposit account shall be subject to the exclusive custody and control of the Collateral Agent, and the Collateral Agent shall have sole signature authority with respect thereto; (ii) any Class B Reserve Account Property that is a bankers acceptance or is commercial paper, negotiable certificates of deposit or another obligation that constitutes "instruments" within the meaning of Section 9-105(1)(i) of the UCC or that is a "certificated security" as defined in Section 8-102 of the UCC shall be delivered to the Collateral Agent in accordance with paragraph (a) or (b), as applicable, of the definition of "Delivery" and shall be held, pending maturity or disposition, solely by the Collateral Agent or its securities intermediary as described in such paragraphs (a) and (b) and in accordance with Section 9.115 of the Uniform Commercial Code as adopted in the State of Texas (the "Texas UCC"); (iii) any Class B Reserve Account Property that is a book-entry security held through the Federal Reserve System pursuant to Federal book-entry regulations shall be delivered in accordance with paragraph (c), as applicable, of the definition of "Delivery" and shall be maintained by the Collateral Agent, pending maturity or disposition, through continued book-entry registration of such Class B Reserve Account Property as described in such paragraph, and additionally, shall be maintained in accordance with Section 9.115 of the Texas UCC; and (iv) any Class B Reserve Account Property that is an uncertificated security as defined in Section 8-102(1)(b) of the UCC and that is not governed by clause (ii) above shall be delivered to the Collateral Agent in accordance with paragraph (d) of the definition of "Delivery" and shall be maintained by the Collateral Agent, pending maturity or disposition, through continued registration of the Collateral Agent's (or its nominee's) ownership of such security, and additionally, shall be maintained in accordance with Section 9.115 of the Texas UCC. Each of the Depositor, the Servicer, the Collateral Agent and the Trustee agrees to take or cause to be taken such further actions, to execute, deliver and file or cause to be executed, delivered and filed such further documents and instruments (including, without limitation, any UCC financing statements or this Agreement) as may be determined to be necessary to perfect the interests created by this Section in favor of the Trustee or the Collateral Agent and otherwise fully to effectuate the purposes, terms and conditions of this Section. Except as heretofore provided with respect to Investment, the Collateral Agent shall not comply or agree to comply with any order from the Depositor or any other Person except the Trustee with respect to the disposition of the Class B Reserve Account Property. The Depositor shall: (i) promptly execute, deliver and file any financing statements, amendments, continuation statements, assignments, certificates and other documents with respect to such interests and perform all such other acts as may be necessary in order to perfect or to maintain the perfection of the Collateral Agent's security interest in the Class B Reserve Account Property; and (ii) make the necessary filings of financing statements or amendments thereto within ten business days after the occurrence of any of the following: (1) any change in its corporate name or any trade name; (2) any change in the location of its chief executive office or principal place of business; and (3) any merger or consolidation or other change in its identity or corporate structure and promptly notify the Trustee of any such filings. (d) If on any Distribution Date the Total Distribution Amount is insufficient to distribute the full amount described in clauses (vi) and (ix) of Section 4.6(c), the Collateral Agent shall withdraw an amount from the Class B Reserve Account (excluding any amount deposited therein on such Distribution Date pursuant to Section 4.6(c)(vii)) equal to such insufficiency and deliver the amount so withdrawn (the "Class B Reserve Account Draw") to the Trustee for deposit in the Certificate Account for application (in the order of priority provided by Section 4.6(c)) in respect of such insufficiencies and any such disposition of the Class B Reserve Account Property is hereby deemed to be upon the instruction of the Trustee.
Appears in 1 contract
Samples: Pooling and Servicing Agreement (Long Beach Holdings Corp)
Class B Reserve Account. (a) In order to effectuate The Servicer shall ------------------------ establish and maintain, in the subordination provided name of the Trustee, on behalf of the Trust, for herein and to assure that sufficient amounts to make required distributions to the Certificateholders will be availablebenefit of the Class B Certificateholders, there shall be established and maintained with the Trustee an Eligible Deposit Account entitled "Class B Reserve Account--Long Beach Acceptance Auto Grantor Trust 1998-1" (the "Class B Reserve Account"), which will include ) bearing a designation clearly indicating that the money and other property funds deposited and therein are held therein pursuant to Sections 4.6(c)(vii) and (x) and this Section 4.7. The Class B Reserve Account shall not be part of the Trust, but instead will be held by the Trustee in a securities account maintained for the Trustee by the Collateral Agent, constituting a security entitlement thereto, for the benefit of the Class B Certificateholders. The OriginatorTrustee shall possess all right, the Depositor, the Trustee and, by its acceptance of a Class B Certificate, each Class B Certificateholder, each acknowledge that solely for federal title and other tax purposes, the Class B Certificateholders and the Excess Cash Flow Certificateholder shall be deemed to own interests interest in a partnership the assets of which consist of the Spread Account and the Class B Reserve Account (and any investment earnings thereon). Each Class B Certificateholder and the Holder of the Excess Cash Flow Certificate, by their acceptance thereof, agrees to treat the Spread Account, the Class B Reserve Account and the rights to releases from the Trust into such accounts (including any investment earnings derived therefrom) the same as such partnership's assets for federal income tax purposes. The Excess Cash Flow Certificateholder, by its acceptance of an Excess Cash Flow Certificate, further acknowledges that any distributions received pursuant to clause (D) of the last paragraph of Section 4.6(c) are pursuant to such partnership arrangement.
(b) On the Closing Date, the Depositor shall deposit the Class B Reserve Account Initial Deposit into the Class B Reserve Account. On each Subsequent Transfer Date, the Depositor shall deposit the related Class B Reserve Account Subsequent Deposit into the Class B Reserve Account. In addition, the Depositor may replace a portion of the amount deposited in the Class B Reserve Account with a letter of credit to be provided to the Depositor's affiliate, AMC, by a banking institution whose long-term debt obligations are rated at least "Aa" by Moody's, in an amount equal to the amount to be withdrawn from the Class B Reserve Account by the Depositor to effect such substitution (such letter of credit, the "Letter of Credit"). The Depositor's ability to substitute such Letter of Credit for a portion of the amount deposited in the Class B Reserve Account shall be subject to the following conditions precedent: (i) delivery by the Depositor to the Trustee, the Rating Agencies and the Certificate Insurer of an Opinion of Counsel, in form and substance acceptable to the Certificate Insurer, in its sole discretion, and (ii) receipt of written confirmation from Moody's that the rating of the Class B Certificates will not be qualified, modified or withdrawn. In the event that the Letter of Credit is delivered to the Trustee and substituted for a portion of the amount all funds on deposit from time to time in the Class B Reserve Account and in all conditions precedent thereto have been satisfied, proceeds thereof. The Class B Reserve Account shall be under the sole dominion and control of the Trustee shall, upon written request from for the Depositor, release the substituted portion benefit of the amount on deposit in Class B Certificateholders. If at any time the Class B Reserve Account ceases to be an Eligible Deposit Account, the Depositor.
Trustee (ior the Servicer on its behalf) In order shall within 10 Business Days (or such longer period, not to give effect exceed 30 calendar days, as to which each Rating Agency may consent) establish a new Class B Reserve Account meeting the subordination provided for herein conditions specified above as an Eligible Deposit Account, and assure availability of the amounts maintained in the shall transfer any cash or any investments to such new Class B Reserve Account. The Trustee, at the Depositor, as initial Holder direction of the Excess Cash Flow CertificateServicer, on behalf of itself, its successors and assigns, and all future Excess Cash Flow Certificateholders by their acceptance of an Excess Cash Flow Certificate, hereby sells, conveys and transfers to the Collateral Agent and its successors and assigns, the Class B Reserve Account Initial Deposit and all proceeds thereof, and hereby pledges to the Collateral Agent and its successors and assigns, for the benefit of the Trustee, all amounts deposited in or credited to shall (i) make withdrawals from the Class B Reserve Account from time to time under this Agreement, all Eligible Investments made with amounts on deposit therein, all earnings and distributions thereon and proceeds thereof, subject, however, in an amount up to the limitations set forth below, and solely for the purpose of securing and providing for payment of Class B Distributable Amounts, Class B Interest Carryover Shortfalls, Class B Principal Carryover Shortfalls, Class B Additional Interest Distributable Amounts and Class B Additional Interest Carryover Shortfalls, in each case to the extent provided in Section 4.6 66 (all the foregoing, subject to the limitations set forth below, being the "Class B Available Reserve Account Property"), to have and to hold all the aforesaid property, rights and privileges unto the Collateral Agent its successors and assignsAmount at such time, for the benefit of the Trustee, in trust for the uses and purposes, and subject to the terms and provisions, purposes set forth in this Section. The Collateral Agent Supplement, and (ii) on behalf of the Trustee hereby acknowledges such transfer each Distribution Date (from and accepts the trusts hereunder and shall hold and distribute after the Class B Reserve Account Property Funding Date) prior to the termination of the Class B Reserve Account make a deposit into the Class B Reserve Account in the amount specified in, and otherwise in accordance with the terms and provisions of this Sectionwith, Section 4.05(a)(xii).
(iib) Consistent with the limited purposes for which such trust is granted on each Distribution Date, the amounts Funds on deposit in the Class B Reserve Account shall be available for distribution as provided invested at the direction of the Servicer by the Trustee in Section 4.6, in accordance with and subject to the following: if the amount Eligible Investments. Funds on deposit in the Class B Reserve Account (on any Transfer Date or Distribution Date, after giving effect to all deposits thereto and any withdrawals therefrom on such Distribution Date) is greater than the Specified Class B Reserve Account Balance, the Trustee shall release and distribute such excess to the Excess Cash Flow Certificateholder pursuant to clause (E) of the last paragraph of SECTION 4.6(c). Upon termination of this Agreement, any remaining amounts in from the Class B Reserve Account on such date, shall be invested in such investments that will mature so that such funds will be distributed available for withdrawal on or prior to the Excess Cash Flow Certificateholder and will constitute a termination following Transfer Date. The Trustee shall maintain for the benefit of the partnership that owns the Spread Account (including any sub-accounts therein) and the Class B Reserve AccountCertificateholders possession of the negotiable instruments or securities, if any, evidencing such Eligible Investments. Upon any No Eligible Investment shall be disposed of prior to its maturity; provided, however, that the Trustee shall -------- ------- sell, liquidate or dispose of an Eligible Investment before its maturity, at the written direction of the Servicer, if such distribution sale, liquidation or disposal would not result in a loss of all or part of the principal portion of such Eligible Investment (the Trustee shall not be responsible for determining whether such a loss would result) or if, prior to the Excess Cash Flow Certificateholdermaturity of such Eligible Investment, a default occurs in the Class A Certificateholders payment of principal, interest or any other amount with respect to such Eligible Investment. On each Transfer Date, all interest and Class B Certificateholders will have no further rights in, or claims to, such amounts.
earnings (cnet of losses and investment expenses) Amounts held accrued since the preceding Transfer Date on funds on deposit in the Class B Reserve Account shall be invested in Eligible Investments which shall mature no later than the Business Day immediately preceding the next Distribution Date in accordance with written instructions from the Depositor and such investments shall not be sold or disposed of prior to their maturity. All such investments shall be deemed to be made at the direction of the Trustee and shall be made for the benefit of the Trustee, and all income and gain realized thereon shall be solely for the benefit of the Depositor subject to the security interest of the Trustee created under SECTION 4.7(b)(ii). Realized losses, if any, on investment of the Class B Reserve Account Property shall be charged first against undistributed investment earnings attributable to the Class B Reserve Account Property. The Trustee, the Depositor, as initial Holder of the Excess Cash Flow Certificate, on behalf of itself, its successors and assigns, and all future Excess Cash Flow Certificateholders by their acceptance of an Excess Cash Flow Certificate, agree that:
(i) any Class B Reserve Account Property that is held in deposit accounts shall be held solely in the name of the Collateral Agent. Each such deposit account shall be subject to the exclusive custody and control of the Collateral Agent, and the Collateral Agent shall have sole signature authority with respect thereto;
(ii) any Class B Reserve Account Property that is a bankers acceptance or is commercial paper, negotiable certificates of deposit or another obligation that constitutes "instruments" within the meaning of Section 9-105(1)(i) of the UCC or that is a "certificated security" as defined in Section 8-102 of the UCC shall be delivered to the Collateral Agent in accordance with paragraph (a) or (b), as applicable, of the definition of "Delivery" and shall be held, pending maturity or disposition, solely by the Collateral Agent or its securities intermediary as described in such paragraphs (a) and (b) and in accordance with Section 9.115 of the Uniform Commercial Code as adopted in the State of Texas (the "Texas UCC");
(iii) any Class B Reserve Account Property that is a book-entry security held through the Federal Reserve System pursuant to Federal book-entry regulations shall be delivered in accordance with paragraph (c), as applicable, of the definition of "Delivery" and shall be maintained by the Collateral Agent, pending maturity or disposition, through continued book-entry registration of such Class B Reserve Account Property as described in such paragraph, and additionally, shall be maintained in accordance with Section 9.115 of the Texas UCC; and
(iv) any Class B Reserve Account Property that is an uncertificated security as defined in Section 8-102(1)(b) of the UCC and that is not governed by clause (ii) above shall be delivered to the Collateral Agent in accordance with paragraph (d) of the definition of "Delivery" and shall be maintained by the Collateral Agent, pending maturity or disposition, through continued registration of the Collateral Agent's (or its nominee's) ownership of such security, and additionally, shall be maintained in accordance with Section 9.115 of the Texas UCC. Each of the Depositor, the Servicer, the Collateral Agent and the Trustee agrees to take or cause to be taken such further actions, to execute, deliver and file or cause to be executed, delivered and filed such further documents and instruments (including, without limitation, any UCC financing statements or this Agreement) as may be determined to be necessary to perfect the interests created by this Section in favor of the Trustee or the Collateral Agent and otherwise fully to effectuate the purposes, terms and conditions of this Section. Except as heretofore provided with respect to Investment, the Collateral Agent shall not comply or agree to comply with any order from the Depositor or any other Person except the Trustee with respect to the disposition of the Class B Reserve Account Property. The Depositor shall:
(i) promptly execute, deliver and file any financing statements, amendments, continuation statements, assignments, certificates and other documents with respect to such interests and perform all such other acts as may be necessary in order to perfect or to maintain the perfection of the Collateral Agent's security interest retained in the Class B Reserve Account Property; and(to the extent that the Class B Available Reserve Account Amount is less than the Class B Required Reserve Account Amount) and the balance, if any, shall be distributed on the related Distribution Date to or at the direction of the Seller. For purposes of determining the availability of funds or the balance in the Class A Reserve Account for any reason under this Supplement, except as otherwise provided in the preceding sentence, investment earnings on such funds shall be deemed not to be available or on deposit.
(iic) make On the necessary filings of financing statements Determination Date preceding each Distribution Date with respect to the Class A Accumulation Period and the first Special Payment Date (on or amendments thereto within ten business days after prior to the occurrence of any Class A Expected Final Payment Date), the Servicer shall calculate the "Class A Reserve Draw Amount," which shall be equal to the excess, if any, of the following: (1) any change in its corporate name Class A Covered Amount with respect to such Distribution Date or any trade nameSpecial Payment Date over the Principal Funding Investment Proceeds with respect to such Distribution Date or Special Payment Date relating to the Principal Funding Account Balance with respect to the Class A Certificates; (2) any change provided, that -------- such amount shall be reduced to the extent that funds otherwise would be available for deposit in the location of its chief executive office Class A Reserve Account under Section 4.05(a)(xi) with respect to such Distribution Date or principal place of business; and (3) any merger or consolidation or other change in its identity or corporate structure and promptly notify the Trustee of any such filingsSpecial Payment Date.
(d) If on In the event that for any Distribution Date the Total Distribution Class A Reserve Draw Amount is insufficient to distribute the full amount described in clauses (vi) and (ix) of Section 4.6(c)greater than zero, the Collateral Agent Class A Reserve Draw Amount, up to the Class A Available Reserve Account Amount, shall withdraw an amount be withdrawn from the Class B A Reserve Account on the related Transfer Date by the Trustee (excluding any amount acting in accordance with the instructions of the Servicer), deposited therein on into the Collection Account and included in Available Finance Charge Collections for such Distribution Date.
(e) On or before each Transfer Date, the Servicer shall determine the amount, if any, of the Class A Reserve Account Surplus for the related Distribution Date, after giving effect to all deposits to and withdrawals from the Class A Reserve Account required to be made with respect to such Distribution Date pursuant to Section 4.6(c)(vii)) equal to such insufficiency and deliver the amount so withdrawn (the "Class B A Reserve Account DrawSurplus Amount"). In the event that the Class A Reserve Account Surplus Amount with respect to any Transfer Date is greater than zero, the Trustee, on the related Distribution Date, acting in accordance with the instructions of the Servicer, shall withdraw from the Class A Reserve Account, and pay to or at the direction of the Seller, an amount equal to such Class A Reserve Account Surplus Amount.
(f) Upon the earliest to occur of (i) the termination of the Trust pursuant to Article XII of the Agreement, (ii) the day on which the Class A Invested Amount is paid in full to the Trustee for Class A Certificateholders, (iii) the Transfer Date immediately preceding the first Special Payment Date and (iv) the Transfer Date immediately preceding the Class A Expected Final Payment Date, the Trustee, acting in accordance with the instructions of the Servicer, after the prior payment of all amounts owing to the Class A Certificateholders that are payable from the Class A Reserve Account as provided herein, shall withdraw from the Class A Reserve Account and pay to or at the direction of the Seller, all amounts, if any, on deposit in the Certificate Class A Reserve Account for application (in the order of priority provided by Section 4.6(c)) in respect of such insufficiencies and any such disposition of the Class B A Reserve Account Property is hereby shall be deemed to be upon the instruction have terminated for purposes of the Trusteethis Supplement.
Appears in 1 contract
Samples: Pooling and Servicing Agreement (Providian National Bank /New/)
Class B Reserve Account. (a) In order to effectuate the subordination provided for herein and to assure that sufficient enhance the amounts available to make required distributions payments to the Certificateholders will be availableClass B Noteholders, there shall be established and maintained with the Trustee Trust Collateral Agent an Eligible Account entitled entitled, "Class B Reserve Account--Long Beach Acceptance Auto Grantor Receivables Trust 19982003-1" (the A"Class B Reserve Account"), which will include the money and other property deposited and held therein pursuant to Sections 4.6(c)(vii) and (xSection 5.6(c)(i), Section 5.6(d)(i) and this Section 4.7. The Class B Reserve Account shall not be part of the Trust, but instead will be held by the Trustee in a securities account maintained for the Trustee by the Collateral Agent, constituting a security entitlement thereto, for the benefit of the Class B Certificateholders. The Originator, the Depositor, the Trustee and, by its acceptance of a Class B Certificate, each Class B Certificateholder, each acknowledge that solely for federal and other tax purposes, the Class B Certificateholders and the Excess Cash Flow Certificateholder shall be deemed to own interests in a partnership the assets of which consist of the Spread Account and the Class B Reserve Account (and any investment earnings thereon). Each Class B Certificateholder and the Holder of the Excess Cash Flow Certificate, by their acceptance thereof, agrees to treat the Spread Account, the Class B Reserve Account and the rights to releases from the Trust into such accounts (including any investment earnings derived therefrom) the same as such partnership's assets for federal income tax purposes. The Excess Cash Flow Certificateholder, by its acceptance of an Excess Cash Flow Certificate, further acknowledges that any distributions received pursuant to clause (D) of the last paragraph of Section 4.6(c) are pursuant to such partnership arrangement5.13.
(ba) On the Closing Date, the Depositor Transferor shall deposit the Class B Reserve Account Initial Deposit into the Class B Reserve Account. On each Subsequent Transfer Date, the Depositor shall deposit the related Class B Reserve Account Subsequent Deposit into the Class B Reserve Account. In addition, the Depositor may replace a portion of the amount deposited in the Class B Reserve Account with a letter of credit to be provided to the Depositor's affiliate, AMC, by a banking institution whose long-term debt obligations are rated at least "Aa" by Moody's, in an amount equal to the amount to be withdrawn from the Class B Reserve Account by the Depositor to effect such substitution (such letter of credit, the "Letter of Credit"). The Depositor's ability to substitute such Letter of Credit for a portion of the amount deposited in the Class B Reserve Account shall be subject to the following conditions precedent: (i) delivery by the Depositor to the Trustee, the Rating Agencies and the Certificate Insurer of an Opinion of Counsel, in form and substance acceptable to the Certificate Insurer, in its sole discretion, and (ii) receipt of written confirmation from Moody's that the rating of the Class B Certificates will not be qualified, modified or withdrawn. In the event that the Letter of Credit is delivered to the Trustee and substituted for a portion of the amount on deposit in the Class B Reserve Account and all conditions precedent thereto have been satisfied, the Trustee shall, upon written request from the Depositor, release the substituted portion of the amount on deposit in the Class B Reserve Account to the Depositor.
(ib) In order to give effect to the subordination provided for herein and assure availability of the amounts maintained in the Class B Reserve Account, the Depositor, as initial Holder of the Excess Cash Flow Certificate, on behalf of itself, its successors and assigns, and all future Excess Cash Flow Certificateholders by their acceptance of an Excess Cash Flow Certificate, hereby sells, conveys and transfers to the Collateral Agent and its successors and assigns, the Class B Reserve Account Initial Deposit and all proceeds thereof, and hereby pledges to the Collateral Agent and its successors and assigns, for the benefit of the Trustee, all amounts deposited in or credited to the Class B Reserve Account from time to time under this Agreement, all Eligible Investments made with amounts on deposit therein, all earnings and distributions thereon and proceeds thereof, subject, however, to the limitations set forth below, and solely for the purpose of securing and providing for payment of Class B Distributable Amounts, Class B Interest Carryover Shortfalls, Class B Principal Carryover Shortfalls, Class B Additional Interest Distributable Amounts and Class B Additional Interest Carryover Shortfalls, in each case to the extent provided in Section 4.6 66 (all the foregoing, subject to the limitations set forth below, being the "Class B Reserve Account Property"), to have and to hold all the aforesaid property, rights and privileges unto the Collateral Agent its successors and assigns, for the benefit of the Trustee, in trust for the uses and purposes, and subject to the terms and provisions, set forth in this Section. The Collateral Agent on behalf of the Trustee hereby acknowledges such transfer and accepts the trusts hereunder and shall hold and distribute the Class B Reserve Account Property in accordance with the terms and provisions of this Section.
(ii) Consistent with the limited purposes for which such trust is granted on each Distribution Date, the amounts on deposit in the Class B Reserve Account shall be available for distribution as provided in Section 4.6, payment in accordance with and subject to the following: if the amount on deposit in the Class B Reserve Account (after giving effect to all deposits thereto and withdrawals therefrom on such Distribution Date) is greater than the Specified Class B Reserve Account Balance, the Trustee shall release and distribute such excess to the Excess Cash Flow Certificateholder pursuant to clause (E) of the last paragraph of SECTION 4.6(cSection 5.6(d). Upon termination of this Agreement and the Class B Noteholders having been paid all amounts due under this Agreement, any remaining amounts in the Class B Reserve Account will be distributed to the Excess Cash Flow Certificateholder and will constitute a termination of the partnership that owns the Spread Account (including any sub-accounts therein) and the Class B Reserve AccountCertificateholder. Upon any such distribution payment to the Excess Cash Flow Certificateholder, the Class A Certificateholders and Class B Certificateholders will Noteholders shall not have no any further rights in, or claims to, such amounts.
(c) Amounts held in the Class B Reserve Account shall be invested in Eligible Investments which shall mature no later than the Business Day immediately preceding the next Distribution Payment Date in accordance with written instructions from the Depositor Transferor and such investments shall not be sold or disposed of prior to their maturity. All such investments shall be deemed to be made at the direction of the Trustee and shall be made for the benefit of the Trustee, and all income and gain realized thereon recognition on such investments shall be solely for the benefit of the Depositor subject to Certificateholder. In no event shall the security interest of the Trustee created under SECTION 4.7(b)(ii). Realized losses, if any, on investment of the Class B Reserve Account Property shall be charged first against undistributed investment earnings attributable to the Class B Reserve Account Property. The Trustee, the Depositor, as initial Holder of the Excess Cash Flow Certificate, on behalf of itself, its successors and assigns, and all future Excess Cash Flow Certificateholders by their acceptance of an Excess Cash Flow Certificate, agree that:
(i) any Class B Reserve Account Property that is held in deposit accounts shall be held solely in the name of the Collateral Agent. Each such deposit account shall be subject to the exclusive custody and control of the Collateral Agent, and the Trust Collateral Agent shall have sole signature authority with respect thereto;
(ii) be liable for any Class B Reserve Account Property that is a bankers acceptance or is commercial paper, negotiable certificates of deposit or another obligation that constitutes "instruments" within the meaning of Section 9-105(1)(i) of the UCC or that is a "certificated security" as defined insufficiencies therein resulting from an investment loss in Section 8-102 of the UCC shall be delivered to the Collateral Agent in accordance with paragraph (a) or (b), as applicable, of the definition of "Delivery" and shall be held, pending maturity or disposition, solely by the Collateral Agent or its securities intermediary as described in such paragraphs (a) and (b) and in accordance with Section 9.115 of the Uniform Commercial Code as adopted in the State of Texas (the "Texas UCC");
(iii) any Class B Reserve Account Property that is a book-entry security held through the Federal Reserve System pursuant to Federal book-entry regulations shall be delivered in accordance with paragraph (c), as applicable, of the definition of "Delivery" and shall be maintained by the Collateral Agent, pending maturity or disposition, through continued book-entry registration of such Class B Reserve Account Property as described in such paragraph, and additionally, shall be maintained in accordance with Section 9.115 of the Texas UCC; and
(iv) any Class B Reserve Account Property that is an uncertificated security as defined in Section 8-102(1)(b) of the UCC and that is not governed by clause (ii) above shall be delivered to the Collateral Agent in accordance with paragraph (d) of the definition of "Delivery" and shall be maintained by the Collateral Agent, pending maturity or disposition, through continued registration of the Collateral Agent's (or its nominee's) ownership of such security, and additionally, shall be maintained in accordance with Section 9.115 of the Texas UCC. Each of the Depositor, the Servicer, the Collateral Agent and the Trustee agrees to take or cause to be taken such further actions, to execute, deliver and file or cause to be executed, delivered and filed such further documents and instruments (including, without limitation, any UCC financing statements or this Agreement) as may be determined to be necessary to perfect the interests created by this Section in favor of the Trustee or the Collateral Agent and otherwise fully to effectuate the purposes, terms and conditions of this Section. Except as heretofore provided with respect to Eligible Investment, the Collateral Agent shall not comply or agree to comply with any order from the Depositor or any other Person except the Trustee with respect to the disposition of the Class B Reserve Account Property. The Depositor shall:
(i) promptly execute, deliver and file any financing statements, amendments, continuation statements, assignments, certificates and other documents with respect to such interests and perform all such other acts as may be necessary in order to perfect or to maintain the perfection of the Collateral Agent's security interest in the Class B Reserve Account Property; and
(ii) make the necessary filings of financing statements or amendments thereto within ten business days after the occurrence of any of the following: (1) any change in its corporate name or any trade name; (2) any change in the location of its chief executive office or principal place of business; and (3) any merger or consolidation or other change in its identity or corporate structure and promptly notify the Trustee of any such filings.
(d) If on any Distribution Payment Date (based on the Total Distribution Amount is Servicer's Certificate delivered on the related Determination Date by the Servicer pursuant to Section 4.9, upon which the Trust Collateral Agent may conclusively rely) the Available Funds, together with the Senior Strip, are insufficient to distribute pay the full amount described in clauses clause (vi) and (ix) of Section 4.6(c5.6(c), the Trust Collateral Agent shall withdraw an amount the Class B Reserve Account Draw from the Class B Reserve Account (excluding any amount deposited therein on such Distribution Date pursuant to Section 4.6(c)(vii)) equal to such insufficiency and deliver the amount so withdrawn (the "Class B Reserve Account Draw") to the Trustee Trust Collateral Agent for deposit in the Certificate Note Account for application (in the order of priority provided by Section 4.6(c)) in respect of such insufficiencies and any such disposition of insufficiency. In addition, if on the Class B Final Scheduled Payment Date, the Available Funds, together with the Senior Strip, are insufficient to retire the Class B Notes, the Trust Collateral Agent shall withdraw the Class B Reserve Account Property is hereby deemed to be upon Draw from the instruction Class B Reserve Account for deposit in the Note Account for application in respect of the Trusteesuch insufficiency.
Appears in 1 contract
Samples: Sale and Servicing Agreement (Long Beach Acceptance Corp)
Class B Reserve Account. (a) In order to effectuate the subordination provided for herein and to assure that sufficient enhance the amounts available to make required distributions payments to the Certificateholders will be availableClass B Noteholders, there shall be established and maintained with the Trustee Trust Collateral Agent an Eligible Account entitled entitled, "Class B Reserve Account--Long Beach Acceptance Auto Grantor Receivables Trust 19982002-1" (the A"Class B Reserve Account"), which will include the money and other property deposited and held therein pursuant to Sections 4.6(c)(vii) and (xSection 5.6(c)(i), Section 5.6(d)(i) and this Section 4.7. The Class B Reserve Account shall not be part of the Trust, but instead will be held by the Trustee in a securities account maintained for the Trustee by the Collateral Agent, constituting a security entitlement thereto, for the benefit of the Class B Certificateholders. The Originator, the Depositor, the Trustee and, by its acceptance of a Class B Certificate, each Class B Certificateholder, each acknowledge that solely for federal and other tax purposes, the Class B Certificateholders and the Excess Cash Flow Certificateholder shall be deemed to own interests in a partnership the assets of which consist of the Spread Account and the Class B Reserve Account (and any investment earnings thereon). Each Class B Certificateholder and the Holder of the Excess Cash Flow Certificate, by their acceptance thereof, agrees to treat the Spread Account, the Class B Reserve Account and the rights to releases from the Trust into such accounts (including any investment earnings derived therefrom) the same as such partnership's assets for federal income tax purposes. The Excess Cash Flow Certificateholder, by its acceptance of an Excess Cash Flow Certificate, further acknowledges that any distributions received pursuant to clause (D) of the last paragraph of Section 4.6(c) are pursuant to such partnership arrangement5.13.
(ba) On the Closing Date, the Depositor Transferor shall deposit the Class B Reserve Account Initial Deposit into the Class B Reserve Account. On each Subsequent Transfer Date, the Depositor shall deposit the related Class B Reserve Account Subsequent Deposit into the Class B Reserve Account. In addition, the Depositor may replace a portion of the amount deposited in the Class B Reserve Account with a letter of credit to be provided to the Depositor's affiliate, AMC, by a banking institution whose long-term debt obligations are rated at least "Aa" by Moody's, in an amount equal to the amount to be withdrawn from the Class B Reserve Account by the Depositor to effect such substitution (such letter of credit, the "Letter of Credit"). The Depositor's ability to substitute such Letter of Credit for a portion of the amount deposited in the Class B Reserve Account shall be subject to the following conditions precedent: (i) delivery by the Depositor to the Trustee, the Rating Agencies and the Certificate Insurer of an Opinion of Counsel, in form and substance acceptable to the Certificate Insurer, in its sole discretion, and (ii) receipt of written confirmation from Moody's that the rating of the Class B Certificates will not be qualified, modified or withdrawn. In the event that the Letter of Credit is delivered to the Trustee and substituted for a portion of the amount on deposit in the Class B Reserve Account and all conditions precedent thereto have been satisfied, the Trustee shall, upon written request from the Depositor, release the substituted portion of the amount on deposit in the Class B Reserve Account to the Depositor.
(ib) In order to give effect to the subordination provided for herein and assure availability of the amounts maintained in the Class B Reserve Account, the Depositor, as initial Holder of the Excess Cash Flow Certificate, on behalf of itself, its successors and assigns, and all future Excess Cash Flow Certificateholders by their acceptance of an Excess Cash Flow Certificate, hereby sells, conveys and transfers to the Collateral Agent and its successors and assigns, the Class B Reserve Account Initial Deposit and all proceeds thereof, and hereby pledges to the Collateral Agent and its successors and assigns, for the benefit of the Trustee, all amounts deposited in or credited to the Class B Reserve Account from time to time under this Agreement, all Eligible Investments made with amounts on deposit therein, all earnings and distributions thereon and proceeds thereof, subject, however, to the limitations set forth below, and solely for the purpose of securing and providing for payment of Class B Distributable Amounts, Class B Interest Carryover Shortfalls, Class B Principal Carryover Shortfalls, Class B Additional Interest Distributable Amounts and Class B Additional Interest Carryover Shortfalls, in each case to the extent provided in Section 4.6 66 (all the foregoing, subject to the limitations set forth below, being the "Class B Reserve Account Property"), to have and to hold all the aforesaid property, rights and privileges unto the Collateral Agent its successors and assigns, for the benefit of the Trustee, in trust for the uses and purposes, and subject to the terms and provisions, set forth in this Section. The Collateral Agent on behalf of the Trustee hereby acknowledges such transfer and accepts the trusts hereunder and shall hold and distribute the Class B Reserve Account Property in accordance with the terms and provisions of this Section.
(ii) Consistent with the limited purposes for which such trust is granted on each Distribution Date, the amounts on deposit in the Class B Reserve Account shall be available for distribution as provided in Section 4.6, payment in accordance with and subject to the following: if the amount on deposit in the Class B Reserve Account (after giving effect to all deposits thereto and withdrawals therefrom on such Distribution Date) is greater than the Specified Class B Reserve Account Balance, the Trustee shall release and distribute such excess to the Excess Cash Flow Certificateholder pursuant to clause (E) of the last paragraph of SECTION 4.6(cSection 5.6(d). Upon termination of this Agreement and the Class B Noteholders having been paid all amounts due under this Agreement, any remaining amounts in the Class B Reserve Account will be distributed to the Excess Cash Flow Certificateholder and will constitute a termination of the partnership that owns the Spread Account (including any sub-accounts therein) and the Class B Reserve AccountCertificateholder. Upon any such distribution payment to the Excess Cash Flow Certificateholder, the Class A Certificateholders and Class B Certificateholders will Noteholders shall not have no any further rights in, or claims to, such amounts.
(c) Amounts held in the Class B Reserve Account shall be invested in Eligible Investments which shall mature no later than the Business Day immediately preceding the next Distribution Payment Date in accordance with written instructions from the Depositor Transferor and such investments shall not be sold or disposed of prior to their maturity. All such investments shall be deemed to be made at the direction of the Trustee and shall be made for the benefit of the Trustee, and all income and gain realized thereon recognition on such investments shall be solely for the benefit of the Depositor subject to Certificateholder. In no event shall the security interest of the Trustee created under SECTION 4.7(b)(ii). Realized losses, if any, on investment of the Class B Reserve Account Property shall be charged first against undistributed investment earnings attributable to the Class B Reserve Account Property. The Trustee, the Depositor, as initial Holder of the Excess Cash Flow Certificate, on behalf of itself, its successors and assigns, and all future Excess Cash Flow Certificateholders by their acceptance of an Excess Cash Flow Certificate, agree that:
(i) any Class B Reserve Account Property that is held in deposit accounts shall be held solely in the name of the Collateral Agent. Each such deposit account shall be subject to the exclusive custody and control of the Collateral Agent, and the Trust Collateral Agent shall have sole signature authority with respect thereto;
(ii) be liable for any Class B Reserve Account Property that is a bankers acceptance or is commercial paper, negotiable certificates of deposit or another obligation that constitutes "instruments" within the meaning of Section 9-105(1)(i) of the UCC or that is a "certificated security" as defined insufficiencies therein resulting from an investment loss in Section 8-102 of the UCC shall be delivered to the Collateral Agent in accordance with paragraph (a) or (b), as applicable, of the definition of "Delivery" and shall be held, pending maturity or disposition, solely by the Collateral Agent or its securities intermediary as described in such paragraphs (a) and (b) and in accordance with Section 9.115 of the Uniform Commercial Code as adopted in the State of Texas (the "Texas UCC");
(iii) any Class B Reserve Account Property that is a book-entry security held through the Federal Reserve System pursuant to Federal book-entry regulations shall be delivered in accordance with paragraph (c), as applicable, of the definition of "Delivery" and shall be maintained by the Collateral Agent, pending maturity or disposition, through continued book-entry registration of such Class B Reserve Account Property as described in such paragraph, and additionally, shall be maintained in accordance with Section 9.115 of the Texas UCC; and
(iv) any Class B Reserve Account Property that is an uncertificated security as defined in Section 8-102(1)(b) of the UCC and that is not governed by clause (ii) above shall be delivered to the Collateral Agent in accordance with paragraph (d) of the definition of "Delivery" and shall be maintained by the Collateral Agent, pending maturity or disposition, through continued registration of the Collateral Agent's (or its nominee's) ownership of such security, and additionally, shall be maintained in accordance with Section 9.115 of the Texas UCC. Each of the Depositor, the Servicer, the Collateral Agent and the Trustee agrees to take or cause to be taken such further actions, to execute, deliver and file or cause to be executed, delivered and filed such further documents and instruments (including, without limitation, any UCC financing statements or this Agreement) as may be determined to be necessary to perfect the interests created by this Section in favor of the Trustee or the Collateral Agent and otherwise fully to effectuate the purposes, terms and conditions of this Section. Except as heretofore provided with respect to Eligible Investment, the Collateral Agent shall not comply or agree to comply with any order from the Depositor or any other Person except the Trustee with respect to the disposition of the Class B Reserve Account Property. The Depositor shall:
(i) promptly execute, deliver and file any financing statements, amendments, continuation statements, assignments, certificates and other documents with respect to such interests and perform all such other acts as may be necessary in order to perfect or to maintain the perfection of the Collateral Agent's security interest in the Class B Reserve Account Property; and
(ii) make the necessary filings of financing statements or amendments thereto within ten business days after the occurrence of any of the following: (1) any change in its corporate name or any trade name; (2) any change in the location of its chief executive office or principal place of business; and (3) any merger or consolidation or other change in its identity or corporate structure and promptly notify the Trustee of any such filings.
(d) If on any Distribution Payment Date (based on the Total Distribution Amount is Servicer's Certificate delivered on the related Determination Date by the Servicer pursuant to Section 4.9, upon which the Trust Collateral Agent may conclusively rely) the Available Funds, together with the Senior Strip, are insufficient to distribute pay the full amount described in clauses clause (vi) and (ix) of Section 4.6(c5.6(c), the Trust Collateral Agent shall withdraw an amount the Class B Reserve Account Draw from the Class B Reserve Account (excluding any amount deposited therein on such Distribution Date pursuant to Section 4.6(c)(vii)) equal to such insufficiency and deliver the amount so withdrawn (the "Class B Reserve Account Draw") to the Trustee Trust Collateral Agent for deposit in the Certificate Note Account for application (in the order of priority provided by Section 4.6(c)) in respect of such insufficiencies and any such disposition of insufficiency. In addition, if on the Class B Final Scheduled Payment Date, the Available Funds, together with the Senior Strip, are insufficient to retire the Class B Notes, the Trust Collateral Agent shall withdraw the Class B Reserve Account Property is hereby deemed to be upon Draw from the instruction Class B Reserve Account for deposit in the Note Account for application in respect of the Trusteesuch insufficiency.
Appears in 1 contract
Samples: Sale and Servicing Agreement (Long Beach Acceptance Corp)
Class B Reserve Account. (a) In order to effectuate The Servicer shall establish and maintain, in the subordination provided name of the Trustee, on behalf of the Trust, for herein and to assure that sufficient amounts to make required distributions to the Certificateholders will be availablebenefit of the Class B Certificateholders, there shall be established and maintained with the Trustee an Eligible Deposit Account entitled "Class B Reserve Account--Long Beach Acceptance Auto Grantor Trust 1998-1" (the "Class B Reserve Account"), which will include ) bearing a designation clearly indicating that the money and other property funds deposited and therein are held therein pursuant to Sections 4.6(c)(vii) and (x) and this Section 4.7. The Class B Reserve Account shall not be part of the Trust, but instead will be held by the Trustee in a securities account maintained for the Trustee by the Collateral Agent, constituting a security entitlement thereto, for the benefit of the Class B Certificateholders. The OriginatorTrustee shall possess all right, the Depositor, the Trustee and, by its acceptance of a Class B Certificate, each Class B Certificateholder, each acknowledge that solely for federal title and other tax purposes, the Class B Certificateholders and the Excess Cash Flow Certificateholder shall be deemed to own interests interest in a partnership the assets of which consist of the Spread Account and the Class B Reserve Account (and any investment earnings thereon). Each Class B Certificateholder and the Holder of the Excess Cash Flow Certificate, by their acceptance thereof, agrees to treat the Spread Account, the Class B Reserve Account and the rights to releases from the Trust into such accounts (including any investment earnings derived therefrom) the same as such partnership's assets for federal income tax purposes. The Excess Cash Flow Certificateholder, by its acceptance of an Excess Cash Flow Certificate, further acknowledges that any distributions received pursuant to clause (D) of the last paragraph of Section 4.6(c) are pursuant to such partnership arrangement.
(b) On the Closing Date, the Depositor shall deposit the Class B Reserve Account Initial Deposit into the Class B Reserve Account. On each Subsequent Transfer Date, the Depositor shall deposit the related Class B Reserve Account Subsequent Deposit into the Class B Reserve Account. In addition, the Depositor may replace a portion of the amount deposited in the Class B Reserve Account with a letter of credit to be provided to the Depositor's affiliate, AMC, by a banking institution whose long-term debt obligations are rated at least "Aa" by Moody's, in an amount equal to the amount to be withdrawn from the Class B Reserve Account by the Depositor to effect such substitution (such letter of credit, the "Letter of Credit"). The Depositor's ability to substitute such Letter of Credit for a portion of the amount deposited in the Class B Reserve Account shall be subject to the following conditions precedent: (i) delivery by the Depositor to the Trustee, the Rating Agencies and the Certificate Insurer of an Opinion of Counsel, in form and substance acceptable to the Certificate Insurer, in its sole discretion, and (ii) receipt of written confirmation from Moody's that the rating of the Class B Certificates will not be qualified, modified or withdrawn. In the event that the Letter of Credit is delivered to the Trustee and substituted for a portion of the amount all funds on deposit from time to time in the Class B Reserve Account and in all conditions precedent thereto have been satisfied, proceeds thereof. The Class B Reserve Account shall be under the sole dominion and control of the Trustee shall, upon written request from for the Depositor, release the substituted portion benefit of the amount on deposit in Class B Certificateholders. If at any time the Class B Reserve Account ceases to be an Eligible Deposit Account, the Depositor.
Trustee (ior the Servicer on its behalf) In order shall within 10 Business Days (or such longer period, not to give effect exceed 30 calendar days, as to which each Rating Agency may consent) establish a new Class B Reserve Account meeting the subordination provided for herein conditions specified above as an Eligible Deposit Account, and assure availability of the amounts maintained in the shall transfer any cash or any investments to such new Class B Reserve Account. The Trustee, at the Depositor, as initial Holder direction of the Excess Cash Flow CertificateServicer, on behalf of itself, its successors and assigns, and all future Excess Cash Flow Certificateholders by their acceptance of an Excess Cash Flow Certificate, hereby sells, conveys and transfers to the Collateral Agent and its successors and assigns, the Class B Reserve Account Initial Deposit and all proceeds thereof, and hereby pledges to the Collateral Agent and its successors and assigns, for the benefit of the Trustee, all amounts deposited in or credited to shall (i) make withdrawals from the Class B Reserve Account from time to time under this Agreement, all Eligible Investments made with amounts on deposit therein, all earnings and distributions thereon and proceeds thereof, subject, however, in an amount up to the limitations set forth below, and solely for the purpose of securing and providing for payment of Class B Distributable Amounts, Class B Interest Carryover Shortfalls, Class B Principal Carryover Shortfalls, Class B Additional Interest Distributable Amounts and Class B Additional Interest Carryover Shortfalls, in each case to the extent provided in Section 4.6 66 (all the foregoing, subject to the limitations set forth below, being the "Class B Available Reserve Account Property"), to have and to hold all the aforesaid property, rights and privileges unto the Collateral Agent its successors and assignsAmount at such time, for the benefit of the Trustee, in trust for the uses and purposes, and subject to the terms and provisions, purposes set forth in this Section. The Collateral Agent Supplement, and (ii) on behalf of the Trustee hereby acknowledges such transfer each Distribution Date (from and accepts the trusts hereunder and shall hold and distribute after the Class B Reserve Account Property Funding Date) prior to the termination of the Class B Reserve Account make a deposit into the Class B Reserve Account in the amount specified in, and otherwise in accordance with the terms and provisions of this Sectionwith, Section 4.05(a)(xii).
(iib) Consistent with the limited purposes for which such trust is granted on each Distribution Date, the amounts Funds on deposit in the Class B Reserve Account shall be available for distribution as provided invested at the direction of the Servicer by the Trustee in Section 4.6, in accordance with and subject to the following: if the amount Eligible Investments. Funds on deposit in the Class B Reserve Account (on any Transfer Date or Distribution Date, after giving effect to all deposits thereto and any withdrawals therefrom on such Distribution Date) is greater than the Specified Class B Reserve Account Balance, the Trustee shall release and distribute such excess to the Excess Cash Flow Certificateholder pursuant to clause (E) of the last paragraph of SECTION 4.6(c). Upon termination of this Agreement, any remaining amounts in from the Class B Reserve Account on such date, shall be invested in such investments that will mature so that such funds will be distributed available for withdrawal on or prior to the Excess Cash Flow Certificateholder and will constitute a termination following Transfer Date. The Trustee shall maintain for the benefit of the partnership that owns the Spread Account (including any sub-accounts therein) and the Class B Reserve AccountCertificateholders possession of the negotiable instruments or securities, if any, evidencing such Eligible Investments. Upon any No Eligible Investment shall be disposed of prior to its maturity; provided, however, that the Trustee shall sell, liquidate or dispose of an Eligible Investment before its maturity, at the written direction of the Servicer, if such distribution sale, liquidation or disposal would not result in a loss of all or part of the principal portion of such Eligible Investment (the Trustee shall not be responsible for determining whether such a loss would result) or if, prior to the Excess Cash Flow Certificateholdermaturity of such Eligible Investment, a default occurs in the Class A Certificateholders payment of principal, interest or any other amount with respect to such Eligible Investment. On each Transfer Date, all interest and Class B Certificateholders will have no further rights in, or claims to, such amounts.
earnings (cnet of losses and investment expenses) Amounts held accrued since the preceding Transfer Date on funds on deposit in the Class B Reserve Account shall be invested retained in Eligible Investments which shall mature no later the Class B Reserve Account (to the extent that the Class B Available Reserve Account Amount is less than the Business Day immediately preceding Class B Required Reserve Account Amount) and the next balance, if any, shall be distributed on the related Distribution Date in accordance with written instructions from the Depositor and such investments shall not be sold to or disposed of prior to their maturity. All such investments shall be deemed to be made at the direction of the Trustee and Seller. For purposes of determining the availability of funds or the balance in the Class B Reserve Account for any reason under this Supplement, except as otherwise provided in the preceding sentence, investment earnings on such funds shall be made for deemed not to be available or on deposit.
(c) On the benefit of Determination Date preceding each Distribution Date with respect to the TrusteeClass B Accumulation Period and the first Special Payment Date (on or prior to the Class B Expected Final Payment Date), and all income and gain realized thereon the Servicer shall calculate the "Class B Reserve Draw Amount," which shall be solely for the benefit of the Depositor subject equal to the security interest of the Trustee created under SECTION 4.7(b)(ii). Realized lossesexcess, if any, of the Class B Covered Amount with respect to such Distribution Date or Special Payment Date over the Principal Funding Investment Proceeds with respect to such Distribution Date or Special Payment Date relating to the Principal Funding Account Balance with respect to the Class B Certificates; provided, that such amount shall be reduced to the extent that funds otherwise would be available for deposit in the Class B Reserve Account under Section 4.05(a)(xii) with respect to such Distribution Date or Special Payment Date.
(d) In the event that for any Distribution Date the Class B Reserve Draw Amount is greater than zero, the Class B Reserve Draw Amount, up to the Class B Available Reserve Account Amount, shall be withdrawn from the Class B Reserve Account on investment the related Transfer Date by the Trustee (acting in accordance with the instructions of the Servicer), deposited into the Collection Account and included in Available Finance Charge Collections for such Distribution Date.
(e) On or before each Transfer Date, the Servicer shall determine the amount, if any, of the Class B Reserve Account Property shall be charged first against undistributed investment earnings attributable Surplus for the related Distribution Date, after giving effect to the Class B Reserve Account Property. The Trustee, the Depositor, as initial Holder of the Excess Cash Flow Certificate, on behalf of itself, its successors all deposits to and assigns, and all future Excess Cash Flow Certificateholders by their acceptance of an Excess Cash Flow Certificate, agree that:
(i) any Class B Reserve Account Property that is held in deposit accounts shall be held solely in the name of the Collateral Agent. Each such deposit account shall be subject to the exclusive custody and control of the Collateral Agent, and the Collateral Agent shall have sole signature authority with respect thereto;
(ii) any Class B Reserve Account Property that is a bankers acceptance or is commercial paper, negotiable certificates of deposit or another obligation that constitutes "instruments" within the meaning of Section 9-105(1)(i) of the UCC or that is a "certificated security" as defined in Section 8-102 of the UCC shall be delivered to the Collateral Agent in accordance with paragraph (a) or (b), as applicable, of the definition of "Delivery" and shall be held, pending maturity or disposition, solely by the Collateral Agent or its securities intermediary as described in such paragraphs (a) and (b) and in accordance with Section 9.115 of the Uniform Commercial Code as adopted in the State of Texas (the "Texas UCC");
(iii) any Class B Reserve Account Property that is a book-entry security held through the Federal Reserve System pursuant to Federal book-entry regulations shall be delivered in accordance with paragraph (c), as applicable, of the definition of "Delivery" and shall be maintained by the Collateral Agent, pending maturity or disposition, through continued book-entry registration of such Class B Reserve Account Property as described in such paragraph, and additionally, shall be maintained in accordance with Section 9.115 of the Texas UCC; and
(iv) any Class B Reserve Account Property that is an uncertificated security as defined in Section 8-102(1)(b) of the UCC and that is not governed by clause (ii) above shall be delivered to the Collateral Agent in accordance with paragraph (d) of the definition of "Delivery" and shall be maintained by the Collateral Agent, pending maturity or disposition, through continued registration of the Collateral Agent's (or its nominee's) ownership of such security, and additionally, shall be maintained in accordance with Section 9.115 of the Texas UCC. Each of the Depositor, the Servicer, the Collateral Agent and the Trustee agrees to take or cause to be taken such further actions, to execute, deliver and file or cause to be executed, delivered and filed such further documents and instruments (including, without limitation, any UCC financing statements or this Agreement) as may be determined to be necessary to perfect the interests created by this Section in favor of the Trustee or the Collateral Agent and otherwise fully to effectuate the purposes, terms and conditions of this Section. Except as heretofore provided with respect to Investment, the Collateral Agent shall not comply or agree to comply with any order from the Depositor or any other Person except the Trustee with respect to the disposition of the Class B Reserve Account Property. The Depositor shall:
(i) promptly execute, deliver and file any financing statements, amendments, continuation statements, assignments, certificates and other documents with respect to such interests and perform all such other acts as may be necessary in order to perfect or to maintain the perfection of the Collateral Agent's security interest in the Class B Reserve Account Property; and
(ii) make the necessary filings of financing statements or amendments thereto within ten business days after the occurrence of any of the following: (1) any change in its corporate name or any trade name; (2) any change in the location of its chief executive office or principal place of business; and (3) any merger or consolidation or other change in its identity or corporate structure and promptly notify the Trustee of any such filings.
(d) If on any Distribution Date the Total Distribution Amount is insufficient to distribute the full amount described in clauses (vi) and (ix) of Section 4.6(c), the Collateral Agent shall withdraw an amount withdrawals from the Class B Reserve Account (excluding any amount deposited therein on required to be made with respect to such Distribution Date pursuant to Section 4.6(c)(vii)) equal to such insufficiency and deliver the amount so withdrawn (the "Class B Reserve Account DrawSurplus Amount") to ). In the Trustee for deposit in the Certificate Account for application (in the order of priority provided by Section 4.6(c)) in respect of such insufficiencies and any such disposition of event that the Class B Reserve Account Property Surplus Amount with respect to any Transfer Date is hereby greater than zero, the Trustee, on the related Distribution Date, acting in accordance with the instructions of the Servicer, shall withdraw from the Class B Reserve Account, and pay to or at the direction of the Seller, an amount equal to such Class B Reserve Account Surplus Amount.
(f) Upon the earliest to occur of (i) the termination of the Trust pursuant to Article XII of the Agreement, (ii) the day on which the Class B Invested Amount is paid in full to the Class B Certificateholders, (iii) the Transfer Date immediately preceding the first Special Payment Date and (iv) the Transfer Date immediately preceding the Class B Expected Final Payment Date or at any time if the Rating Agency Condition is satisfied, the Trustee, acting in accordance with the instructions of the Servicer, after the prior payment of all amounts owing to the Class B Certificateholders that are payable from the Class B Reserve Account as provided herein, shall withdraw from the Class B Reserve Account and pay to or at the direction of the Seller, all amounts, if any, on deposit in the Class B Reserve Account and the Class B Reserve Account shall be deemed to be upon the instruction have terminated for purposes of the Trusteethis Supplement.
Appears in 1 contract
Samples: Pooling and Servicing Agreement (Providian National Bank /New/)
Class B Reserve Account. (a) In order to effectuate the subordination provided for herein and to assure that sufficient enhance the amounts available to make required distributions payments to the Certificateholders will be availableClass B Noteholders, there shall be established and maintained with the Trustee Trust Collateral Agent an Eligible Account entitled entitled, "Class B Reserve Account--Long Beach Acceptance Auto Grantor Receivables Trust 19981999-1" (the "Class B Reserve Account"), which will include the money and other property deposited and held therein pursuant to Sections 4.6(c)(vii) and (xSection 5.6(d)(i) and this Section 4.7. The Class B Reserve Account shall not be part of the Trust, but instead will be held by the Trustee in a securities account maintained for the Trustee by the Collateral Agent, constituting a security entitlement thereto, for the benefit of the Class B Certificateholders. The Originator, the Depositor, the Trustee and, by its acceptance of a Class B Certificate, each Class B Certificateholder, each acknowledge that solely for federal and other tax purposes, the Class B Certificateholders and the Excess Cash Flow Certificateholder shall be deemed to own interests in a partnership the assets of which consist of the Spread Account and the Class B Reserve Account (and any investment earnings thereon). Each Class B Certificateholder and the Holder of the Excess Cash Flow Certificate, by their acceptance thereof, agrees to treat the Spread Account, the Class B Reserve Account and the rights to releases from the Trust into such accounts (including any investment earnings derived therefrom) the same as such partnership's assets for federal income tax purposes. The Excess Cash Flow Certificateholder, by its acceptance of an Excess Cash Flow Certificate, further acknowledges that any distributions received pursuant to clause (D) of the last paragraph of Section 4.6(c) are pursuant to such partnership arrangement5.13.
(ba) On the Closing Date, the Depositor Transferor shall deposit the Initial Class B Reserve Account Initial Deposit into the Class B Reserve Account. On each Subsequent Transfer Date, the Depositor shall deposit the related Class B Reserve Account Subsequent Deposit into the Class B Reserve Account. In addition, the Depositor may replace a portion of the amount deposited in the Class B Reserve Account with a letter of credit to be provided to the Depositor's affiliate, AMC, by a banking institution whose long-term debt obligations are rated at least "Aa" by Moody's, in an amount equal to the amount to be withdrawn from the Class B Reserve Account by the Depositor to effect such substitution (such letter of credit, the "Letter of Credit"). The Depositor's ability to substitute such Letter of Credit for a portion of the amount deposited in the Class B Reserve Account shall be subject to the following conditions precedent: (i) delivery by the Depositor to the Trustee, the Rating Agencies and the Certificate Insurer of an Opinion of Counsel, in form and substance acceptable to the Certificate Insurer, in its sole discretion, and (ii) receipt of written confirmation from Moody's that the rating of the Class B Certificates will not be qualified, modified or withdrawn. In the event that the Letter of Credit is delivered to the Trustee and substituted for a portion of the amount on deposit in the Class B Reserve Account and all conditions precedent thereto have been satisfied, the Trustee shall, upon written request from the Depositor, release the substituted portion of the amount on deposit in the Class B Reserve Account to the Depositor.
(ib) In order to give effect to the subordination provided for herein and assure availability of the amounts maintained in the Class B Reserve Account, the Depositor, as initial Holder of the Excess Cash Flow Certificate, on behalf of itself, its successors and assigns, and all future Excess Cash Flow Certificateholders by their acceptance of an Excess Cash Flow Certificate, hereby sells, conveys and transfers to the Collateral Agent and its successors and assigns, the Class B Reserve Account Initial Deposit and all proceeds thereof, and hereby pledges to the Collateral Agent and its successors and assigns, for the benefit of the Trustee, all amounts deposited in or credited to the Class B Reserve Account from time to time under this Agreement, all Eligible Investments made with amounts on deposit therein, all earnings and distributions thereon and proceeds thereof, subject, however, to the limitations set forth below, and solely for the purpose of securing and providing for payment of Class B Distributable Amounts, Class B Interest Carryover Shortfalls, Class B Principal Carryover Shortfalls, Class B Additional Interest Distributable Amounts and Class B Additional Interest Carryover Shortfalls, in each case to the extent provided in Section 4.6 66 (all the foregoing, subject to the limitations set forth below, being the "Class B Reserve Account Property"), to have and to hold all the aforesaid property, rights and privileges unto the Collateral Agent its successors and assigns, for the benefit of the Trustee, in trust for the uses and purposes, and subject to the terms and provisions, set forth in this Section. The Collateral Agent on behalf of the Trustee hereby acknowledges such transfer and accepts the trusts hereunder and shall hold and distribute the Class B Reserve Account Property in accordance with the terms and provisions of this Section.
(ii) Consistent with the limited purposes for which such trust is granted on each Distribution Date, the amounts on deposit in the Class B Reserve Account shall be available for distribution as provided in Section 4.6, payment in accordance with and subject to the following: if the amount on deposit in the Class B Reserve Account (after giving effect to all deposits thereto and withdrawals therefrom on such Distribution Date) is greater than the Specified Class B Reserve Account Balance, the Trustee shall release and distribute such excess to the Excess Cash Flow Certificateholder pursuant to clause (E) of the last paragraph of SECTION 4.6(cSection 5.6(d). Upon termination of this Agreement and the Class B Noteholders having been paid all amounts due under this Agreement, any remaining amounts in the Class B Reserve Account will be distributed to the Excess Cash Flow Certificateholder and will constitute a termination of the partnership that owns the Spread Account (including any sub-accounts therein) and the Class B Reserve AccountCertificateholder. Upon any such distribution payment to the Excess Cash Flow Certificateholder, the Class A Certificateholders and Class B Certificateholders Noteholders will not have no any further rights in, or claims to, such amounts.
(c) Amounts held in the Class B Reserve Account shall be invested in Eligible Investments which shall mature no later than the Business Day immediately preceding the next Distribution Payment Date in accordance with written instructions from the Depositor Transferor and such investments shall not be sold or disposed of prior to their maturity. All such investments shall be deemed to be made at the direction of the Trustee and shall be made for the benefit of the Trustee, and all income and gain realized thereon recognition on such investments shall be solely for the benefit of the Depositor subject to Certificateholder. In no event shall the security interest of the Trustee created under SECTION 4.7(b)(ii). Realized losses, if any, on investment of the Class B Reserve Account Property shall be charged first against undistributed investment earnings attributable to the Class B Reserve Account Property. The Trustee, the Depositor, as initial Holder of the Excess Cash Flow Certificate, on behalf of itself, its successors and assigns, and all future Excess Cash Flow Certificateholders by their acceptance of an Excess Cash Flow Certificate, agree that:
(i) any Class B Reserve Account Property that is held in deposit accounts shall be held solely in the name of the Collateral Agent. Each such deposit account shall be subject to the exclusive custody and control of the Collateral Agent, and the Trust Collateral Agent shall have sole signature authority with respect thereto;
(ii) be liable for any Class B Reserve Account Property that is a bankers acceptance or is commercial paper, negotiable certificates of deposit or another obligation that constitutes "instruments" within the meaning of Section 9-105(1)(i) of the UCC or that is a "certificated security" as defined insufficiencies therein resulting from an investment loss in Section 8-102 of the UCC shall be delivered to the Collateral Agent in accordance with paragraph (a) or (b), as applicable, of the definition of "Delivery" and shall be held, pending maturity or disposition, solely by the Collateral Agent or its securities intermediary as described in such paragraphs (a) and (b) and in accordance with Section 9.115 of the Uniform Commercial Code as adopted in the State of Texas (the "Texas UCC");
(iii) any Class B Reserve Account Property that is a book-entry security held through the Federal Reserve System pursuant to Federal book-entry regulations shall be delivered in accordance with paragraph (c), as applicable, of the definition of "Delivery" and shall be maintained by the Collateral Agent, pending maturity or disposition, through continued book-entry registration of such Class B Reserve Account Property as described in such paragraph, and additionally, shall be maintained in accordance with Section 9.115 of the Texas UCC; and
(iv) any Class B Reserve Account Property that is an uncertificated security as defined in Section 8-102(1)(b) of the UCC and that is not governed by clause (ii) above shall be delivered to the Collateral Agent in accordance with paragraph (d) of the definition of "Delivery" and shall be maintained by the Collateral Agent, pending maturity or disposition, through continued registration of the Collateral Agent's (or its nominee's) ownership of such security, and additionally, shall be maintained in accordance with Section 9.115 of the Texas UCC. Each of the Depositor, the Servicer, the Collateral Agent and the Trustee agrees to take or cause to be taken such further actions, to execute, deliver and file or cause to be executed, delivered and filed such further documents and instruments (including, without limitation, any UCC financing statements or this Agreement) as may be determined to be necessary to perfect the interests created by this Section in favor of the Trustee or the Collateral Agent and otherwise fully to effectuate the purposes, terms and conditions of this Section. Except as heretofore provided with respect to Eligible Investment, the Collateral Agent shall not comply or agree to comply with any order from the Depositor or any other Person except the Trustee with respect to the disposition of the Class B Reserve Account Property. The Depositor shall:
(i) promptly execute, deliver and file any financing statements, amendments, continuation statements, assignments, certificates and other documents with respect to such interests and perform all such other acts as may be necessary in order to perfect or to maintain the perfection of the Collateral Agent's security interest in the Class B Reserve Account Property; and
(ii) make the necessary filings of financing statements or amendments thereto within ten business days after the occurrence of any of the following: (1) any change in its corporate name or any trade name; (2) any change in the location of its chief executive office or principal place of business; and (3) any merger or consolidation or other change in its identity or corporate structure and promptly notify the Trustee of any such filings.
(d) If on any Distribution Payment Date (based on the Total Distribution Amount is Servicer's Certificate delivered on the related Determination Date by the Servicer pursuant to Section 4.9, upon which the Trust Collateral Agent may conclusively rely) the Available Funds are insufficient to distribute pay the full amount described in clauses clause (vi) and (ix) of Section 4.6(c5.6(c), the Trust Collateral Agent shall withdraw an amount the Class B Reserve Account Draw from the Class B Reserve Account (excluding any amount deposited therein on such Distribution Date pursuant to Section 4.6(c)(vii)) equal to such insufficiency and deliver the amount so withdrawn (the "Class B Reserve Account Draw") to the Trustee Trust Collateral Agent for deposit in the Certificate Note Account for application (in the order of priority provided by Section 4.6(c5.6(c)) in respect of such insufficiencies and any such disposition of the Class B Reserve Account Property is hereby deemed to be upon the instruction of the Trusteeinsufficiency.
Appears in 1 contract
Samples: Sale and Servicing Agreement (Long Beach Holdings Corp)
Class B Reserve Account. (a) In order to effectuate The Servicer shall establish and maintain, in the subordination provided name of the Trustee, on behalf of the Trust, for herein and to assure that sufficient amounts to make required distributions to the Certificateholders will be availablebenefit of the Class B Certificateholders, there shall be established and maintained with the Trustee an Eligible Deposit Account entitled "Class B Reserve Account--Long Beach Acceptance Auto Grantor Trust 1998-1" (the "Class B Reserve Account"), which will include ) bearing a designation clearly indicating that the money and other property funds deposited and therein are held therein pursuant to Sections 4.6(c)(vii) and (x) and this Section 4.7. The Class B Reserve Account shall not be part of the Trust, but instead will be held by the Trustee in a securities account maintained for the Trustee by the Collateral Agent, constituting a security entitlement thereto, for the benefit of the Class B Certificateholders. The OriginatorTrustee shall possess all right, the Depositor, the Trustee and, by its acceptance of a Class B Certificate, each Class B Certificateholder, each acknowledge that solely for federal title and other tax purposes, the Class B Certificateholders and the Excess Cash Flow Certificateholder shall be deemed to own interests interest in a partnership the assets of which consist of the Spread Account and the Class B Reserve Account (and any investment earnings thereon). Each Class B Certificateholder and the Holder of the Excess Cash Flow Certificate, by their acceptance thereof, agrees to treat the Spread Account, the Class B Reserve Account and the rights to releases from the Trust into such accounts (including any investment earnings derived therefrom) the same as such partnership's assets for federal income tax purposes. The Excess Cash Flow Certificateholder, by its acceptance of an Excess Cash Flow Certificate, further acknowledges that any distributions received pursuant to clause (D) of the last paragraph of Section 4.6(c) are pursuant to such partnership arrangement.
(b) On the Closing Date, the Depositor shall deposit the Class B Reserve Account Initial Deposit into the Class B Reserve Account. On each Subsequent Transfer Date, the Depositor shall deposit the related Class B Reserve Account Subsequent Deposit into the Class B Reserve Account. In addition, the Depositor may replace a portion of the amount deposited in the Class B Reserve Account with a letter of credit to be provided to the Depositor's affiliate, AMC, by a banking institution whose long-term debt obligations are rated at least "Aa" by Moody's, in an amount equal to the amount to be withdrawn from the Class B Reserve Account by the Depositor to effect such substitution (such letter of credit, the "Letter of Credit"). The Depositor's ability to substitute such Letter of Credit for a portion of the amount deposited in the Class B Reserve Account shall be subject to the following conditions precedent: (i) delivery by the Depositor to the Trustee, the Rating Agencies and the Certificate Insurer of an Opinion of Counsel, in form and substance acceptable to the Certificate Insurer, in its sole discretion, and (ii) receipt of written confirmation from Moody's that the rating of the Class B Certificates will not be qualified, modified or withdrawn. In the event that the Letter of Credit is delivered to the Trustee and substituted for a portion of the amount all funds on deposit from time to time in the Class B Reserve Account and in all conditions precedent thereto have been satisfied, proceeds thereof. The Class B Reserve Account shall be under the sole dominion and control of the Trustee shall, upon written request from for the Depositor, release the substituted portion benefit of the amount on deposit in Class B Certificateholders. If at any time the Class B Reserve Account ceases to be an Eligible Deposit Account, the Depositor.
Trustee (ior the Servicer on its behalf) In order shall within 10 Business Days (or such longer period, not to give effect exceed 30 calendar days, as to which each Rating Agency may consent) establish a new Class B Reserve Account meeting the subordination provided for herein conditions specified above as an Eligible Deposit Account, and assure availability of the amounts maintained in the shall transfer any cash or any investments to such new Class B Reserve Account. The Trustee, at the Depositor, as initial Holder direction of the Excess Cash Flow CertificateServicer, on behalf of itself, its successors and assigns, and all future Excess Cash Flow Certificateholders by their acceptance of an Excess Cash Flow Certificate, hereby sells, conveys and transfers to the Collateral Agent and its successors and assigns, the Class B Reserve Account Initial Deposit and all proceeds thereof, and hereby pledges to the Collateral Agent and its successors and assigns, for the benefit of the Trustee, all amounts deposited in or credited to shall (i) make withdrawals from the Class B Reserve Account from time to time under this Agreement, all Eligible Investments made with amounts on deposit therein, all earnings and distributions thereon and proceeds thereof, subject, however, in an amount up to the limitations set forth below, and solely for the purpose of securing and providing for payment of Class B Distributable Amounts, Class B Interest Carryover Shortfalls, Class B Principal Carryover Shortfalls, Class B Additional Interest Distributable Amounts and Class B Additional Interest Carryover Shortfalls, in each case to the extent provided in Section 4.6 66 (all the foregoing, subject to the limitations set forth below, being the "Class B Available Reserve Account Property"), to have and to hold all the aforesaid property, rights and privileges unto the Collateral Agent its successors and assignsAmount at such time, for the benefit of the Trustee, in trust for the uses and purposes, and subject to the terms and provisions, purposes set forth in this Section. The Collateral Agent Supplement, and (ii) on behalf of the Trustee hereby acknowledges such transfer each Distribution Date (from and accepts the trusts hereunder and shall hold and distribute after the Class B Reserve Account Property Funding Date) prior to the termination of the Class B Reserve Account make a deposit into the Class B Reserve Account in the amount specified in, and otherwise in accordance with the terms and provisions of this Sectionwith, Section 4.05(a)(xii).
(iib) Consistent with the limited purposes for which such trust is granted on each Distribution Date, the amounts Funds on deposit in the Class B Reserve Account shall be available for distribution as provided invested at the direction of the Servicer by the Trustee in Section 4.6, in accordance with and subject to the following: if the amount Eligible Investments. Funds on deposit in the Class B Reserve Account (on any Transfer Date or Distribution Date, after giving effect to all deposits thereto and any withdrawals therefrom on such Distribution Date) is greater than the Specified Class B Reserve Account Balance, the Trustee shall release and distribute such excess to the Excess Cash Flow Certificateholder pursuant to clause (E) of the last paragraph of SECTION 4.6(c). Upon termination of this Agreement, any remaining amounts in from the Class B Reserve Account on such date, shall be invested in such investments that will mature so that such funds will be distributed available for withdrawal on or prior to the Excess Cash Flow Certificateholder and will constitute a termination following Transfer Date. The Trustee shall maintain for the benefit of the partnership that owns the Spread Account (including any sub-accounts therein) and the Class B Reserve AccountCertificateholders possession of the negotiable instruments or securities, if any, evidencing such Eligible Investments. Upon any No Eligible Investment shall be disposed of prior to its maturity; provided, however, that the Trustee shall sell, liquidate or dispose of an Eligible Investment before its maturity, at the written direction of the Servicer, if such distribution sale, liquidation or disposal would not result in a loss of all or part of the principal portion of such Eligible Investment (the Trustee shall not be responsible for determining whether such a loss would result) or if, prior to the Excess Cash Flow Certificateholdermaturity of such Eligible Investment, a default occurs in the Class A Certificateholders payment of principal, interest or any other amount with respect to such Eligible Investment. On each Transfer Date, all interest and Class B Certificateholders will have no further rights in, or claims to, such amounts.
earnings (cnet of losses and investment expenses) Amounts held accrued since the preceding Transfer Date on funds on deposit in the Class B Reserve Account shall be invested retained in Eligible Investments which shall mature no later the Class B Reserve Account (to the extent that the Class B Available Reserve Account Amount is less than the Business Day immediately preceding Class B Required Reserve Account Amount) and the next balance, if any, shall be distributed on the related Distribution Date in accordance with written instructions from the Depositor and such investments shall not be sold to or disposed of prior to their maturity. All such investments shall be deemed to be made at the direction of the Trustee and Seller. For purposes of determining the availability of funds or the balance in the Class B Reserve Account for any reason under this Supplement, except as otherwise provided in the preceding sentence, investment earnings on such funds shall be made for deemed not to be available or on deposit.
(c) On the benefit of Determination Date preceding each Distribution Date with respect to the TrusteeClass B Accumulation Period and the first Special Payment Date (on or prior to the Class B Expected Final Payment Date), and all income and gain realized thereon the Servicer shall calculate the "Class B Reserve Draw Amount," which shall be solely for the benefit of the Depositor subject equal to the security interest of the Trustee created under SECTION 4.7(b)(ii). Realized lossesexcess, if any, of the Class B Covered Amount with respect to such Distribution Date or Special Payment Date over the Principal Funding Investment Proceeds with respect to such Distribution Date or Special Payment Date relating to the Principal Funding Account Balance with respect to the Class B Certificates; provided, that such amount shall be reduced to the extent that funds otherwise would be available for deposit in the Class B Reserve Account under Section 4.05(a)(xii) with respect to such Distribution Date or Special Payment Date.
(d) In the event that for any Distribution Date the Class B Reserve Draw Amount is greater than zero, the Class B Reserve Draw Amount, up to the Class B Available Reserve Account Amount, shall be withdrawn from the Class B Reserve Account on investment the related Transfer Date by the Trustee (acting in accordance with the instructions of the Servicer), deposited into the Collection Account and included in Available Finance Charge Collections for such Distribution Date.
(e) On or before each Transfer Date, the Servicer shall determine the amount, if any, of the Class B Reserve Account Property shall be charged first against undistributed investment earnings attributable Surplus for the related Distribution Date, after giving effect to the Class B Reserve Account Property. The Trustee, the Depositor, as initial Holder of the Excess Cash Flow Certificate, on behalf of itself, its successors all deposits to and assigns, and all future Excess Cash Flow Certificateholders by their acceptance of an Excess Cash Flow Certificate, agree that:
(i) any Class B Reserve Account Property that is held in deposit accounts shall be held solely in the name of the Collateral Agent. Each such deposit account shall be subject to the exclusive custody and control of the Collateral Agent, and the Collateral Agent shall have sole signature authority with respect thereto;
(ii) any Class B Reserve Account Property that is a bankers acceptance or is commercial paper, negotiable certificates of deposit or another obligation that constitutes "instruments" within the meaning of Section 9-105(1)(i) of the UCC or that is a "certificated security" as defined in Section 8-102 of the UCC shall be delivered to the Collateral Agent in accordance with paragraph (a) or (b), as applicable, of the definition of "Delivery" and shall be held, pending maturity or disposition, solely by the Collateral Agent or its securities intermediary as described in such paragraphs (a) and (b) and in accordance with Section 9.115 of the Uniform Commercial Code as adopted in the State of Texas (the "Texas UCC");
(iii) any Class B Reserve Account Property that is a book-entry security held through the Federal Reserve System pursuant to Federal book-entry regulations shall be delivered in accordance with paragraph (c), as applicable, of the definition of "Delivery" and shall be maintained by the Collateral Agent, pending maturity or disposition, through continued book-entry registration of such Class B Reserve Account Property as described in such paragraph, and additionally, shall be maintained in accordance with Section 9.115 of the Texas UCC; and
(iv) any Class B Reserve Account Property that is an uncertificated security as defined in Section 8-102(1)(b) of the UCC and that is not governed by clause (ii) above shall be delivered to the Collateral Agent in accordance with paragraph (d) of the definition of "Delivery" and shall be maintained by the Collateral Agent, pending maturity or disposition, through continued registration of the Collateral Agent's (or its nominee's) ownership of such security, and additionally, shall be maintained in accordance with Section 9.115 of the Texas UCC. Each of the Depositor, the Servicer, the Collateral Agent and the Trustee agrees to take or cause to be taken such further actions, to execute, deliver and file or cause to be executed, delivered and filed such further documents and instruments (including, without limitation, any UCC financing statements or this Agreement) as may be determined to be necessary to perfect the interests created by this Section in favor of the Trustee or the Collateral Agent and otherwise fully to effectuate the purposes, terms and conditions of this Section. Except as heretofore provided with respect to Investment, the Collateral Agent shall not comply or agree to comply with any order from the Depositor or any other Person except the Trustee with respect to the disposition of the Class B Reserve Account Property. The Depositor shall:
(i) promptly execute, deliver and file any financing statements, amendments, continuation statements, assignments, certificates and other documents with respect to such interests and perform all such other acts as may be necessary in order to perfect or to maintain the perfection of the Collateral Agent's security interest in the Class B Reserve Account Property; and
(ii) make the necessary filings of financing statements or amendments thereto within ten business days after the occurrence of any of the following: (1) any change in its corporate name or any trade name; (2) any change in the location of its chief executive office or principal place of business; and (3) any merger or consolidation or other change in its identity or corporate structure and promptly notify the Trustee of any such filings.
(d) If on any Distribution Date the Total Distribution Amount is insufficient to distribute the full amount described in clauses (vi) and (ix) of Section 4.6(c), the Collateral Agent shall withdraw an amount withdrawals from the Class B Reserve Account (excluding any amount deposited therein on required to be made with respect to such Distribution Date pursuant to Section 4.6(c)(vii)) equal to such insufficiency and deliver the amount so withdrawn (the "Class B Reserve Account DrawSurplus Amount") to ). In the Trustee for deposit in the Certificate Account for application (in the order of priority provided by Section 4.6(c)) in respect of such insufficiencies and any such disposition of event that the Class B Reserve Account Property Surplus Amount with respect to any Transfer Date is hereby greater than zero, the Trustee, on the related Distribution Date, acting in accordance with the instructions of the Servicer, shall withdraw from the Class B Reserve Account, and pay to or at the direction of the Seller, an amount equal to such Class B Reserve Account Surplus Amount.
(f) Upon the earliest to occur of (i) the termination of the Trust pursuant to Article XII of the Agreement, (ii) the day on which the Class B Invested Amount is paid in full to the Class B Certificateholders, (ii Transfer Date immediately preceding the first Special Payment Date and (iv) the Transfer Date immediately preceding the Class B Expected Final Payment Date or at any time if the Rating Agency Condition is satisfied, the Trustee, acting in accordance with the instructions of the Servicer, after the prior payment of all amounts owing to the Class B Certificateholders that are payable from the Class B Reserve Account as provided herein, shall withdraw from the Class B Reserve Account and pay to or at the direction of the Seller, all amounts, if any, on deposit in the Class B Reserve Account and the Class B Reserve Account shall be deemed to be upon the instruction have terminated for purposes of the Trusteethis Supplement.
Appears in 1 contract
Samples: Pooling and Servicing Agreement (Providian Master Trust)
Class B Reserve Account. (a) In order to effectuate the subordination provided for herein and to assure that sufficient amounts to make required distributions to the Certificateholders will be available, there shall be established and maintained with the Trustee an Eligible Account entitled "Class B Reserve Account--Long Beach Acceptance Auto Grantor Trust 1998-1" (the "Class B Reserve Account"), which will include the money and other property deposited and held therein pursuant to Sections 4.6(c)(vii) and (x) and this Section 4.7. The Class B Reserve Account shall not be part of the Trust, but instead will be held by the Trustee in a securities account maintained for the Trustee by the Collateral Agent, constituting a security entitlement thereto, for the benefit of the Class B Certificateholders. The Originator, the Depositor, the Trustee and, by its acceptance of a Class B Certificate, each Class B Certificateholder, each acknowledge that solely for federal and other tax purposes, the Class B Certificateholders and the Excess Cash Flow Certificateholder shall be deemed to own interests in a partnership the assets of which consist of the Spread Account and the Class B Reserve Account (and any investment earnings thereon). Each Class B Certificateholder and the Holder of the Excess Cash Flow Certificate, by their acceptance thereof, agrees to treat the Spread Account, the Class B Reserve Account and the rights to releases from the Trust into such accounts (including any investment earnings derived therefrom) the same as such partnership's assets for federal income tax purposes. The Excess Cash Flow Certificateholder, by its acceptance of an Excess Cash Flow Certificate, further acknowledges that any distributions received pursuant to clause (D) of the last paragraph of Section 4.6(c) are pursuant to such partnership arrangement.
(b) On the Closing each Payment Date, the Depositor shall deposit the Class B Reserve Account Initial Deposit into the Class B Reserve Account. On each Subsequent Transfer Date, the Depositor shall deposit the related Class B Reserve Account Subsequent Deposit into the Class B Reserve Account. In addition, the Depositor may replace a portion of the amount deposited in the Class B Reserve Account with a letter of credit to be provided to the Depositor's affiliate, AMC, by a banking institution whose long-term debt obligations are rated at least "Aa" by Moody's, in an amount equal to the amount to be withdrawn from the Class B Reserve Account by the Depositor to effect such substitution (such letter of credit, the "Letter of Credit"). The Depositor's ability to substitute such Letter of Credit for a portion of the amount deposited in the Class B Reserve Account shall be subject to the following conditions precedent: (i) delivery by the Depositor to the Trustee, the Rating Agencies and the Certificate Insurer of an Opinion of Counsel, in form and substance acceptable to the Certificate Insurer, in its sole discretion, and (ii) receipt of written confirmation from Moody's that the rating of the Class B Certificates will not be qualified, modified or withdrawn. In the event that the Letter of Credit is delivered to the Trustee and substituted for a portion of the amount on deposit in the Class B Reserve Account and all conditions precedent thereto have been satisfiedwill be withdrawn by the Indenture Trustee, at the Trustee shall, upon written request from the Depositor, release the substituted portion direction of the amount on deposit Servicer, to the extent necessary, to fund any deficiencies in the Class B Reserve Account to following amounts, in the Depositor.following order of priority:
(i) In order to give effect to the subordination provided for herein and assure availability of the amounts maintained in the Class B Reserve Account, the Depositor, as initial Holder of the Excess Cash Flow Certificate, on behalf of itself, its successors and assigns, and all future Excess Cash Flow Certificateholders by their acceptance of an Excess Cash Flow Certificate, hereby sells, conveys and transfers to the Collateral Agent and its successors and assigns, the Class B Reserve Account Initial Deposit and all proceeds thereof, and hereby pledges to the Collateral Agent and its successors and assigns, for the benefit of the Trustee, all amounts deposited in or credited to the Class B Reserve Account from time to time under this Agreement, all Eligible Investments made with amounts on deposit therein, all earnings and distributions thereon and proceeds thereof, subject, however, to the limitations set forth below, and solely for the purpose of securing and providing for payment of Class B Distributable Amounts, Class B Note Interest Carryover Shortfalls, Class B Principal Carryover Shortfalls, Class B Additional Interest Distributable Amounts and Class B Additional Interest Carryover Shortfalls, in each case to the extent provided in Section 4.6 66 (all the foregoing, subject to the limitations set forth below, being the "Class B Reserve Account Property"), to have and to hold all the aforesaid property, rights and privileges unto the Collateral Agent its successors and assigns, for the benefit of the Trustee, in trust for the uses and purposes, and subject to the terms and provisions, set forth in this Section. The Collateral Agent on behalf of the Trustee hereby acknowledges such transfer and accepts the trusts hereunder and shall hold and distribute the Class B Reserve Account Property in accordance with the terms and provisions of this Section.then due; and
(ii) Consistent with on the limited purposes for which such trust is granted on each Distribution Class B Maturity Date, the amounts on deposit in amount necessary to reduce the Class B Reserve Account shall be available for distribution as provided in Section 4.6Note Principal Balance to zero.
(c) On any Payment Date, in accordance with and subject to the following: if the amount on deposit in the Class B Reserve Account (after giving effect to all deposits thereto and any withdrawals therefrom on such Distribution DatePayment Date in accordance with the foregoing) is greater than the Specified Class B Reserve Account Balance, the Trustee shall release and distribute such in excess to the Excess Cash Flow Certificateholder pursuant to clause (E) of the last paragraph of SECTION 4.6(c). Upon termination of this Agreement, any remaining amounts in the Class B Reserve Account Requisite Amount with respect to such Payment Date, such excess shall be released to the holders of the Certificates in accordance with their respective percentage interests, unless a Restricting Event or an Event of Default has occurred and is continuing, in which case the excess will be distributed to the Excess Cash Flow Certificateholder and will constitute a termination of the partnership that owns the Spread Account (including any sub-accounts therein) and retained in the Class B Reserve Account. Upon any such distribution to Following the Excess Cash Flow Certificateholderinitial deposit of the Class B Initial Reserve Account Requirement into the Class B Reserve Account, no additional amounts will be deposited into the Class B Reserve Account. On the Payment Date on which the Class B Note Principal Balance has been paid in full, the Class A Certificateholders and Class B Certificateholders will have no further rights in, or claims to, such amounts.
(c) Amounts held amount remaining on deposit in the Class B Reserve Account shall be invested in Eligible Investments which shall mature no later than released to the Business Day immediately preceding the next Distribution Date Certificateholders in accordance with written instructions from their respective percentage interest of Certificates. Notwithstanding the Depositor and such investments shall not be sold or disposed of foregoing, prior to their maturity. All such investments shall be deemed to be made at the direction of the Trustee and shall be made for the benefit of the Trustee, and all income and gain realized thereon shall be solely for the benefit of the Depositor subject to the security interest of the Trustee created under SECTION 4.7(b)(ii). Realized losses, if any, on investment of the Class B Reserve Account Property shall be charged first against undistributed investment earnings attributable to the Class B Reserve Account Property. The Trustee, the Depositor, as initial Holder of the Excess Cash Flow Certificate, on behalf of itself, its successors and assigns, and all future Excess Cash Flow Certificateholders by their acceptance of an Excess Cash Flow Certificate, agree that:
(i) releasing any Class B Reserve Account Property that is held in deposit accounts shall be held solely in the name of the Collateral Agent. Each such deposit account shall be subject to the exclusive custody and control of the Collateral Agent, and the Collateral Agent shall have sole signature authority with respect thereto;
(ii) any Class B Reserve Account Property that is a bankers acceptance or is commercial paper, negotiable certificates of deposit or another obligation that constitutes "instruments" within the meaning of Section 9-105(1)(i) of the UCC or that is a "certificated security" as defined in Section 8-102 of the UCC shall be delivered to the Collateral Agent in accordance with paragraph (a) or (b), as applicable, of the definition of "Delivery" and shall be held, pending maturity or disposition, solely by the Collateral Agent or its securities intermediary as described in such paragraphs (a) and (b) and in accordance with Section 9.115 of the Uniform Commercial Code as adopted in the State of Texas (the "Texas UCC");
(iii) any Class B Reserve Account Property that is a book-entry security held through the Federal Reserve System pursuant to Federal book-entry regulations shall be delivered in accordance with paragraph (c), as applicable, of the definition of "Delivery" and shall be maintained by the Collateral Agent, pending maturity or disposition, through continued book-entry registration of such Class B Reserve Account Property as described in such paragraph, and additionally, shall be maintained in accordance with Section 9.115 of the Texas UCC; and
(iv) any Class B Reserve Account Property that is an uncertificated security as defined in Section 8-102(1)(b) of the UCC and that is not governed by clause (ii) above shall be delivered to the Collateral Agent in accordance with paragraph (d) of the definition of "Delivery" and shall be maintained by the Collateral Agent, pending maturity or disposition, through continued registration of the Collateral Agent's (or its nominee's) ownership of such security, and additionally, shall be maintained in accordance with Section 9.115 of the Texas UCC. Each of the Depositor, the Servicer, the Collateral Agent and the Trustee agrees to take or cause to be taken such further actions, to execute, deliver and file or cause to be executed, delivered and filed such further documents and instruments (including, without limitation, any UCC financing statements or this Agreement) as may be determined to be necessary to perfect the interests created by this Section in favor of the Trustee or the Collateral Agent and otherwise fully to effectuate the purposes, terms and conditions of this Section. Except as heretofore provided with respect to Investment, the Collateral Agent shall not comply or agree to comply with any order from the Depositor or any other Person except the Trustee with respect to the disposition of the Class B Reserve Account Property. The Depositor shall:
(i) promptly execute, deliver and file any financing statements, amendments, continuation statements, assignments, certificates and other documents with respect to such interests and perform all such other acts as may be necessary in order to perfect or to maintain the perfection of the Collateral Agent's security interest in the Class B Reserve Account Property; and
(ii) make the necessary filings of financing statements or amendments thereto within ten business days after the occurrence of any of the following: (1) any change in its corporate name or any trade name; (2) any change in the location of its chief executive office or principal place of business; and (3) any merger or consolidation or other change in its identity or corporate structure and promptly notify the Trustee of any such filings.
(d) If on any Distribution Date the Total Distribution Amount is insufficient to distribute the full amount described in clauses (vi) and (ix) of Section 4.6(c), the Collateral Agent shall withdraw an amount amounts from the Class B Reserve Account (excluding any amount deposited therein on such Distribution Date pursuant to Section 4.6(c)(vii)) equal to such insufficiency and deliver the amount so withdrawn (the "Class B Reserve Account Draw") to the Trustee for deposit in the Certificate Account for application (in the order of priority provided by Section 4.6(c)) in respect of Certificateholders on any Payment Date, such insufficiencies and amount shall first be applied to repay any such disposition of outstanding Write-Down Amounts allocated to the Class B Reserve Account Property is hereby deemed to be upon the instruction of the TrusteeNotes.
Appears in 1 contract
Samples: Indenture (Unicapital Corp)
Class B Reserve Account. (a) In order to effectuate the subordination provided for herein and to assure that sufficient enhance the amounts available to make required distributions payments to the Certificateholders will be availableClass B Noteholders, there shall be established and maintained with the Trustee Trust Collateral Agent an Eligible Account entitled entitled, "Class B Reserve Account--Long Beach Acceptance Auto Grantor Receivables Trust 19982000-1" (the "Class B Reserve Account"), which will include the money and other property deposited and held therein pursuant to Sections 4.6(c)(vii) and (xSection 5.6(d)(i) and this Section 4.7. The Class B Reserve Account shall not be part of the Trust, but instead will be held by the Trustee in a securities account maintained for the Trustee by the Collateral Agent, constituting a security entitlement thereto, for the benefit of the Class B Certificateholders. The Originator, the Depositor, the Trustee and, by its acceptance of a Class B Certificate, each Class B Certificateholder, each acknowledge that solely for federal and other tax purposes, the Class B Certificateholders and the Excess Cash Flow Certificateholder shall be deemed to own interests in a partnership the assets of which consist of the Spread Account and the Class B Reserve Account (and any investment earnings thereon). Each Class B Certificateholder and the Holder of the Excess Cash Flow Certificate, by their acceptance thereof, agrees to treat the Spread Account, the Class B Reserve Account and the rights to releases from the Trust into such accounts (including any investment earnings derived therefrom) the same as such partnership's assets for federal income tax purposes. The Excess Cash Flow Certificateholder, by its acceptance of an Excess Cash Flow Certificate, further acknowledges that any distributions received pursuant to clause (D) of the last paragraph of Section 4.6(c) are pursuant to such partnership arrangement5.15.
(ba) On the Closing Date, the Depositor Transferor shall deposit the Initial Class B Reserve Account Initial Deposit into the Class B Reserve Account. On each Subsequent Transfer Date, the Depositor Transferor shall deposit the related Class B Reserve Account Subsequent Deposit into the Class B Reserve Account. In addition, the Depositor may replace a portion of the amount deposited in the Class B Reserve Account with a letter of credit to be provided to the Depositor's affiliate, AMC, by a banking institution whose long-term debt obligations are rated at least "Aa" by Moody's, in an amount equal to the amount to be withdrawn from the Class B Reserve Account by the Depositor to effect such substitution (such letter of credit, the "Letter of Credit"). The Depositor's ability to substitute such Letter of Credit for a portion of the amount deposited in the Class B Reserve Account shall be subject to the following conditions precedent: (i) delivery by the Depositor to the Trustee, the Rating Agencies and the Certificate Insurer of an Opinion of Counsel, in form and substance acceptable to the Certificate Insurer, in its sole discretion, and (ii) receipt of written confirmation from Moody's that the rating of the Class B Certificates will not be qualified, modified or withdrawn. In the event that the Letter of Credit is delivered to the Trustee and substituted for a portion of the amount on deposit in the Class B Reserve Account and all conditions precedent thereto have been satisfied, the Trustee shall, upon written request from the Depositor, release the substituted portion of the amount on deposit in the Class B Reserve Account to the Depositor.
(ib) In order to give effect to the subordination provided for herein and assure availability of the amounts maintained in the Class B Reserve Account, the Depositor, as initial Holder of the Excess Cash Flow Certificate, on behalf of itself, its successors and assigns, and all future Excess Cash Flow Certificateholders by their acceptance of an Excess Cash Flow Certificate, hereby sells, conveys and transfers to the Collateral Agent and its successors and assigns, the Class B Reserve Account Initial Deposit and all proceeds thereof, and hereby pledges to the Collateral Agent and its successors and assigns, for the benefit of the Trustee, all amounts deposited in or credited to the Class B Reserve Account from time to time under this Agreement, all Eligible Investments made with amounts on deposit therein, all earnings and distributions thereon and proceeds thereof, subject, however, to the limitations set forth below, and solely for the purpose of securing and providing for payment of Class B Distributable Amounts, Class B Interest Carryover Shortfalls, Class B Principal Carryover Shortfalls, Class B Additional Interest Distributable Amounts and Class B Additional Interest Carryover Shortfalls, in each case to the extent provided in Section 4.6 66 (all the foregoing, subject to the limitations set forth below, being the "Class B Reserve Account Property"), to have and to hold all the aforesaid property, rights and privileges unto the Collateral Agent its successors and assigns, for the benefit of the Trustee, in trust for the uses and purposes, and subject to the terms and provisions, set forth in this Section. The Collateral Agent on behalf of the Trustee hereby acknowledges such transfer and accepts the trusts hereunder and shall hold and distribute the Class B Reserve Account Property in accordance with the terms and provisions of this Section.
(ii) Consistent with the limited purposes for which such trust is granted on each Distribution Date, the amounts on deposit in the Class B Reserve Account shall be available for distribution as provided in Section 4.6, payment in accordance with and subject to the following: if the amount on deposit in the Class B Reserve Account (after giving effect to all deposits thereto and withdrawals therefrom on such Distribution Date) is greater than the Specified Class B Reserve Account Balance, the Trustee shall release and distribute such excess to the Excess Cash Flow Certificateholder pursuant to clause (E) of the last paragraph of SECTION 4.6(cSection 5.6(d). Upon termination of this Agreement and the Class B Noteholders having been paid all amounts due under this Agreement, any remaining amounts in the Class B Reserve Account will be distributed to the Excess Cash Flow Certificateholder and will constitute a termination of the partnership that owns the Spread Account (including any sub-accounts therein) and the Class B Reserve AccountCertificateholder. Upon any such distribution payment to the Excess Cash Flow Certificateholder, the Class A Certificateholders and Class B Certificateholders Noteholders will not have no any further rights in, or claims to, such amounts.
(c) Amounts held in the Class B Reserve Account shall be invested in Eligible Investments which shall mature no later than the Business Day immediately preceding the next Distribution Payment Date in accordance with written instructions from the Depositor Transferor and such investments shall not be sold or disposed of prior to their maturity. All such investments shall be deemed to be made at the direction of the Trustee and shall be made for the benefit of the Trustee, and all income and gain realized thereon recognition on such investments shall be solely for the benefit of the Depositor subject to Certificateholder. In no event shall the security interest of the Trustee created under SECTION 4.7(b)(ii). Realized losses, if any, on investment of the Class B Reserve Account Property shall be charged first against undistributed investment earnings attributable to the Class B Reserve Account Property. The Trustee, the Depositor, as initial Holder of the Excess Cash Flow Certificate, on behalf of itself, its successors and assigns, and all future Excess Cash Flow Certificateholders by their acceptance of an Excess Cash Flow Certificate, agree that:
(i) any Class B Reserve Account Property that is held in deposit accounts shall be held solely in the name of the Collateral Agent. Each such deposit account shall be subject to the exclusive custody and control of the Collateral Agent, and the Trust Collateral Agent shall have sole signature authority with respect thereto;
(ii) be liable for any Class B Reserve Account Property that is a bankers acceptance or is commercial paper, negotiable certificates of deposit or another obligation that constitutes "instruments" within the meaning of Section 9-105(1)(i) of the UCC or that is a "certificated security" as defined insufficiencies therein resulting from an investment loss in Section 8-102 of the UCC shall be delivered to the Collateral Agent in accordance with paragraph (a) or (b), as applicable, of the definition of "Delivery" and shall be held, pending maturity or disposition, solely by the Collateral Agent or its securities intermediary as described in such paragraphs (a) and (b) and in accordance with Section 9.115 of the Uniform Commercial Code as adopted in the State of Texas (the "Texas UCC");
(iii) any Class B Reserve Account Property that is a book-entry security held through the Federal Reserve System pursuant to Federal book-entry regulations shall be delivered in accordance with paragraph (c), as applicable, of the definition of "Delivery" and shall be maintained by the Collateral Agent, pending maturity or disposition, through continued book-entry registration of such Class B Reserve Account Property as described in such paragraph, and additionally, shall be maintained in accordance with Section 9.115 of the Texas UCC; and
(iv) any Class B Reserve Account Property that is an uncertificated security as defined in Section 8-102(1)(b) of the UCC and that is not governed by clause (ii) above shall be delivered to the Collateral Agent in accordance with paragraph (d) of the definition of "Delivery" and shall be maintained by the Collateral Agent, pending maturity or disposition, through continued registration of the Collateral Agent's (or its nominee's) ownership of such security, and additionally, shall be maintained in accordance with Section 9.115 of the Texas UCC. Each of the Depositor, the Servicer, the Collateral Agent and the Trustee agrees to take or cause to be taken such further actions, to execute, deliver and file or cause to be executed, delivered and filed such further documents and instruments (including, without limitation, any UCC financing statements or this Agreement) as may be determined to be necessary to perfect the interests created by this Section in favor of the Trustee or the Collateral Agent and otherwise fully to effectuate the purposes, terms and conditions of this Section. Except as heretofore provided with respect to Eligible Investment, the Collateral Agent shall not comply or agree to comply with any order from the Depositor or any other Person except the Trustee with respect to the disposition of the Class B Reserve Account Property. The Depositor shall:
(i) promptly execute, deliver and file any financing statements, amendments, continuation statements, assignments, certificates and other documents with respect to such interests and perform all such other acts as may be necessary in order to perfect or to maintain the perfection of the Collateral Agent's security interest in the Class B Reserve Account Property; and
(ii) make the necessary filings of financing statements or amendments thereto within ten business days after the occurrence of any of the following: (1) any change in its corporate name or any trade name; (2) any change in the location of its chief executive office or principal place of business; and (3) any merger or consolidation or other change in its identity or corporate structure and promptly notify the Trustee of any such filings.
(d) If on any Distribution Payment Date (based on the Total Distribution Amount is Servicer's Certificate delivered on the related Determination Date by the Servicer pursuant to Section 4.9, upon which the Trust Collateral Agent may conclusively rely) the Available Funds are insufficient to distribute pay the full amount described in clauses clause (vi) and (ix) of Section 4.6(c5.6(c), the Trust Collateral Agent shall withdraw an amount the Class B Reserve Account Draw from the Class B Reserve Account (excluding any amount deposited therein on such Distribution Date pursuant to Section 4.6(c)(vii)) equal to such insufficiency and deliver the amount so withdrawn (the "Class B Reserve Account Draw") to the Trustee Trust Collateral Agent for deposit in the Certificate Note Account for application (in the order of priority provided by Section 4.6(c5.6(c)) in respect of such insufficiencies and any such disposition of the Class B Reserve Account Property is hereby deemed to be upon the instruction of the Trusteeinsufficiency.
Appears in 1 contract
Samples: Sale and Servicing Agreement (Long Beach Holdings Corp)
Class B Reserve Account. (a) In order to effectuate the subordination provided for herein and to assure that sufficient enhance the amounts available to make required distributions payments to the Certificateholders will be availableClass B Noteholders, there shall be established and maintained with the Trustee Trust Collateral Agent an Eligible Account entitled entitled, "Class B Reserve Account--Long Beach Acceptance Auto Grantor Receivables Trust 19981999-1" (the 2"Class B Reserve Account"), which will include the money and other property deposited and held therein pursuant to Sections 4.6(c)(vii) and (xSection 5.6(d)(i) and this Section 4.7. The Class B Reserve Account shall not be part of the Trust, but instead will be held by the Trustee in a securities account maintained for the Trustee by the Collateral Agent, constituting a security entitlement thereto, for the benefit of the Class B Certificateholders. The Originator, the Depositor, the Trustee and, by its acceptance of a Class B Certificate, each Class B Certificateholder, each acknowledge that solely for federal and other tax purposes, the Class B Certificateholders and the Excess Cash Flow Certificateholder shall be deemed to own interests in a partnership the assets of which consist of the Spread Account and the Class B Reserve Account (and any investment earnings thereon). Each Class B Certificateholder and the Holder of the Excess Cash Flow Certificate, by their acceptance thereof, agrees to treat the Spread Account, the Class B Reserve Account and the rights to releases from the Trust into such accounts (including any investment earnings derived therefrom) the same as such partnership's assets for federal income tax purposes. The Excess Cash Flow Certificateholder, by its acceptance of an Excess Cash Flow Certificate, further acknowledges that any distributions received pursuant to clause (D) of the last paragraph of Section 4.6(c) are pursuant to such partnership arrangement5.15.
(ba) On the Closing Date, the Depositor Transferor shall deposit the Initial Class B Reserve Account Initial Deposit into the Class B Reserve Account. On each Subsequent Transfer Date, the Depositor Transferor shall deposit the related Class B Reserve Account Subsequent Deposit into the Class B Reserve Account. In addition, the Depositor may replace a portion of the amount deposited in the Class B Reserve Account with a letter of credit to be provided to the Depositor's affiliate, AMC, by a banking institution whose long-term debt obligations are rated at least "Aa" by Moody's, in an amount equal to the amount to be withdrawn from the Class B Reserve Account by the Depositor to effect such substitution (such letter of credit, the "Letter of Credit"). The Depositor's ability to substitute such Letter of Credit for a portion of the amount deposited in the Class B Reserve Account shall be subject to the following conditions precedent: (i) delivery by the Depositor to the Trustee, the Rating Agencies and the Certificate Insurer of an Opinion of Counsel, in form and substance acceptable to the Certificate Insurer, in its sole discretion, and (ii) receipt of written confirmation from Moody's that the rating of the Class B Certificates will not be qualified, modified or withdrawn. In the event that the Letter of Credit is delivered to the Trustee and substituted for a portion of the amount on deposit in the Class B Reserve Account and all conditions precedent thereto have been satisfied, the Trustee shall, upon written request from the Depositor, release the substituted portion of the amount on deposit in the Class B Reserve Account to the Depositor.
(ib) In order to give effect to the subordination provided for herein and assure availability of the amounts maintained in the Class B Reserve Account, the Depositor, as initial Holder of the Excess Cash Flow Certificate, on behalf of itself, its successors and assigns, and all future Excess Cash Flow Certificateholders by their acceptance of an Excess Cash Flow Certificate, hereby sells, conveys and transfers to the Collateral Agent and its successors and assigns, the Class B Reserve Account Initial Deposit and all proceeds thereof, and hereby pledges to the Collateral Agent and its successors and assigns, for the benefit of the Trustee, all amounts deposited in or credited to the Class B Reserve Account from time to time under this Agreement, all Eligible Investments made with amounts on deposit therein, all earnings and distributions thereon and proceeds thereof, subject, however, to the limitations set forth below, and solely for the purpose of securing and providing for payment of Class B Distributable Amounts, Class B Interest Carryover Shortfalls, Class B Principal Carryover Shortfalls, Class B Additional Interest Distributable Amounts and Class B Additional Interest Carryover Shortfalls, in each case to the extent provided in Section 4.6 66 (all the foregoing, subject to the limitations set forth below, being the "Class B Reserve Account Property"), to have and to hold all the aforesaid property, rights and privileges unto the Collateral Agent its successors and assigns, for the benefit of the Trustee, in trust for the uses and purposes, and subject to the terms and provisions, set forth in this Section. The Collateral Agent on behalf of the Trustee hereby acknowledges such transfer and accepts the trusts hereunder and shall hold and distribute the Class B Reserve Account Property in accordance with the terms and provisions of this Section.
(ii) Consistent with the limited purposes for which such trust is granted on each Distribution Date, the amounts on deposit in the Class B Reserve Account shall be available for distribution as provided in Section 4.6, payment in accordance with and subject to the following: if the amount on deposit in the Class B Reserve Account (after giving effect to all deposits thereto and withdrawals therefrom on such Distribution Date) is greater than the Specified Class B Reserve Account Balance, the Trustee shall release and distribute such excess to the Excess Cash Flow Certificateholder pursuant to clause (E) of the last paragraph of SECTION 4.6(cSection 5.6(d). Upon termination of this Agreement and the Class B Noteholders having been paid all amounts due under this Agreement, any remaining amounts in the Class B Reserve Account will be distributed to the Excess Cash Flow Certificateholder and will constitute a termination of the partnership that owns the Spread Account (including any sub-accounts therein) and the Class B Reserve AccountCertificateholder. Upon any such distribution payment to the Excess Cash Flow Certificateholder, the Class A Certificateholders and Class B Certificateholders Noteholders will not have no any further rights in, or claims to, such amounts.
(c) Amounts held in the Class B Reserve Account shall be invested in Eligible Investments which shall mature no later than the Business Day immediately preceding the next Distribution Payment Date in accordance with written instructions from the Depositor Transferor and such investments shall not be sold or disposed of prior to their maturity. All such investments shall be deemed to be made at the direction of the Trustee and shall be made for the benefit of the Trustee, and all income and gain realized thereon recognition on such investments shall be solely for the benefit of the Depositor subject to Certificateholder. In no event shall the security interest of the Trustee created under SECTION 4.7(b)(ii). Realized losses, if any, on investment of the Class B Reserve Account Property shall be charged first against undistributed investment earnings attributable to the Class B Reserve Account Property. The Trustee, the Depositor, as initial Holder of the Excess Cash Flow Certificate, on behalf of itself, its successors and assigns, and all future Excess Cash Flow Certificateholders by their acceptance of an Excess Cash Flow Certificate, agree that:
(i) any Class B Reserve Account Property that is held in deposit accounts shall be held solely in the name of the Collateral Agent. Each such deposit account shall be subject to the exclusive custody and control of the Collateral Agent, and the Trust Collateral Agent shall have sole signature authority with respect thereto;
(ii) be liable for any Class B Reserve Account Property that is a bankers acceptance or is commercial paper, negotiable certificates of deposit or another obligation that constitutes "instruments" within the meaning of Section 9-105(1)(i) of the UCC or that is a "certificated security" as defined insufficiencies therein resulting from an investment loss in Section 8-102 of the UCC shall be delivered to the Collateral Agent in accordance with paragraph (a) or (b), as applicable, of the definition of "Delivery" and shall be held, pending maturity or disposition, solely by the Collateral Agent or its securities intermediary as described in such paragraphs (a) and (b) and in accordance with Section 9.115 of the Uniform Commercial Code as adopted in the State of Texas (the "Texas UCC");
(iii) any Class B Reserve Account Property that is a book-entry security held through the Federal Reserve System pursuant to Federal book-entry regulations shall be delivered in accordance with paragraph (c), as applicable, of the definition of "Delivery" and shall be maintained by the Collateral Agent, pending maturity or disposition, through continued book-entry registration of such Class B Reserve Account Property as described in such paragraph, and additionally, shall be maintained in accordance with Section 9.115 of the Texas UCC; and
(iv) any Class B Reserve Account Property that is an uncertificated security as defined in Section 8-102(1)(b) of the UCC and that is not governed by clause (ii) above shall be delivered to the Collateral Agent in accordance with paragraph (d) of the definition of "Delivery" and shall be maintained by the Collateral Agent, pending maturity or disposition, through continued registration of the Collateral Agent's (or its nominee's) ownership of such security, and additionally, shall be maintained in accordance with Section 9.115 of the Texas UCC. Each of the Depositor, the Servicer, the Collateral Agent and the Trustee agrees to take or cause to be taken such further actions, to execute, deliver and file or cause to be executed, delivered and filed such further documents and instruments (including, without limitation, any UCC financing statements or this Agreement) as may be determined to be necessary to perfect the interests created by this Section in favor of the Trustee or the Collateral Agent and otherwise fully to effectuate the purposes, terms and conditions of this Section. Except as heretofore provided with respect to Eligible Investment, the Collateral Agent shall not comply or agree to comply with any order from the Depositor or any other Person except the Trustee with respect to the disposition of the Class B Reserve Account Property. The Depositor shall:
(i) promptly execute, deliver and file any financing statements, amendments, continuation statements, assignments, certificates and other documents with respect to such interests and perform all such other acts as may be necessary in order to perfect or to maintain the perfection of the Collateral Agent's security interest in the Class B Reserve Account Property; and
(ii) make the necessary filings of financing statements or amendments thereto within ten business days after the occurrence of any of the following: (1) any change in its corporate name or any trade name; (2) any change in the location of its chief executive office or principal place of business; and (3) any merger or consolidation or other change in its identity or corporate structure and promptly notify the Trustee of any such filings.
(d) If on any Distribution Payment Date (based on the Total Distribution Amount is Servicer's Certificate delivered on the related Determination Date by the Servicer pursuant to Section 4.9, upon which the Trust Collateral Agent may conclusively rely) the Available Funds are insufficient to distribute pay the full amount described in clauses clause (vi) and (ix) of Section 4.6(c5.6(c), the Trust Collateral Agent shall withdraw an amount the Class B Reserve Account Draw from the Class B Reserve Account (excluding any amount deposited therein on such Distribution Date pursuant to Section 4.6(c)(vii)) equal to such insufficiency and deliver the amount so withdrawn (the "Class B Reserve Account Draw") to the Trustee Trust Collateral Agent for deposit in the Certificate Note Account for application (in the order of priority provided by Section 4.6(c5.6(c)) in respect of such insufficiencies and any such disposition of the Class B Reserve Account Property is hereby deemed to be upon the instruction of the Trusteeinsufficiency.
Appears in 1 contract
Samples: Sale and Servicing Agreement (Long Beach Holdings Corp)
