EXHIBIT 4.1
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EXECUTION COPY
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AMENDED AND RESTATED TRUST AGREEMENT
between
ML ASSET BACKED CORPORATION,
as Depositor
and
U.S. BANK TRUST NATIONAL ASSOCIATION,
as Owner Trustee
Dated as of May 31, 2005
TABLE OF CONTENTS
Page
ARTICLE I
DEFINITIONS
Section 1.01. Capitalized Terms.............................................................................1
Section 1.02. Other Definitional Provisions.................................................................3
ARTICLE II
ORGANIZATION
Section 2.01. Name..........................................................................................4
Section 2.02. Office........................................................................................4
Section 2.03. Purposes and Powers...........................................................................4
Section 2.04. Appointment of Owner Trustee..................................................................5
Section 2.05. Initial Capital Contribution of Trust Estate..................................................5
Section 2.06. Declaration of Trust..........................................................................5
Section 2.07. Characterization of the Trust for Tax Purposes................................................5
Section 2.08. Liability of Certificateholders...............................................................6
Section 2.09. Title to Trust Property.......................................................................6
Section 2.10. Situs of Trust................................................................................6
Section 2.11. Representations, Warranties and Covenants of the Depositor....................................6
Section 2.12. Federal Income Tax Matters....................................................................7
ARTICLE III
TRUST CERTIFICATES AND TRANSFER OF INTERESTS
Section 3.01. Initial Ownership.............................................................................8
Section 3.02. The Trust Certificates........................................................................8
Section 3.03. Execution, Authentication and Delivery of Trust Certificates..................................8
Section 3.04. Registration of Certificates; Transfer and Exchange of Trust Certificates;
Limitations on Transfer.......................................................................8
Section 3.05. Mutilated, Destroyed, Lost or Stolen Trust Certificates......................................10
Section 3.06. Persons Deemed Owners........................................................................11
Section 3.07. Access to List of Certificateholders' Names and Addresses....................................11
Section 3.08. Maintenance of Office or Agency..............................................................11
Section 3.09. Appointment of Paying Agent..................................................................11
Section 3.10. Definitive Trust Certificates................................................................12
Section 3.11. Certificates Nonassessable and Fully Paid....................................................12
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ARTICLE IV
ACTIONS BY OWNER TRUSTEE
Section 4.01. Prior Notice with Respect to Certain Matters.................................................12
Section 4.02. Action by Certificateholders with Respect to Certain Matters.................................14
Section 4.03. Restrictions on Certificateholders' Power....................................................15
Section 4.04. Majority Control.............................................................................15
ARTICLE V
APPLICATION OF TRUST FUNDS; CERTAIN DUTIES
Section 5.01. Establishment of Trust Account...............................................................15
Section 5.02. Application of Trust Funds...................................................................15
Section 5.03. Method of Payment............................................................................16
Section 5.04. No Segregation of Moneys; No Interest........................................................17
Section 5.05. Accounting and Reports to Certificateholders, the Internal Revenue Service and Others........17
Section 5.06. Signature on Returns; Tax Matters Partner....................................................17
ARTICLE VI
AUTHORITY AND DUTIES OF OWNER TRUSTEE
Section 6.01. General Authority............................................................................17
Section 6.02. General Duties...............................................................................18
Section 6.03. Action upon Instruction......................................................................18
Section 6.04. No Duties Except as Specified in this Agreement or in Instructions...........................19
Section 6.05. No Action Except Under Specified Documents or Instructions...................................19
Section 6.06. Restrictions.................................................................................19
Section 6.07. Administrative Duties........................................................................19
ARTICLE VII
CONCERNING THE OWNER TRUSTEE
Section 7.01. Acceptance of Trusts and Duties..............................................................22
Section 7.02. Furnishing of Documents......................................................................23
Section 7.03. Representations and Warranties...............................................................24
Section 7.04. Reliance; Advice of Counsel..................................................................24
Section 7.05. Not Acting in Individual Capacity............................................................25
Section 7.06. Owner Trustee Not Liable for Trust Certificates or for Receivables...........................25
Section 7.07. Owner Trustee May Own Trust Certificates and Notes...........................................25
Section 7.08. Doing Business in Other Jurisdictions........................................................25
Section 7.09. Paying Agent, Certificate Registrar and Authenticating Agent.................................26
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ARTICLE VIII
COMPENSATION OF OWNER TRUSTEE
Section 8.01. Owner Trustee's Fees and Expenses............................................................26
Section 8.02. Indemnification..............................................................................26
Section 8.03. Payments to the Owner Trustee................................................................27
ARTICLE IX
TERMINATION OF TRUST AGREEMENT
Section 9.01. Termination of Trust Agreement...............................................................27
ARTICLE X
SUCCESSOR OWNER TRUSTEES AND ADDITIONAL OWNER TRUSTEES
Section 10.01. Eligibility Requirements for Owner Trustee...................................................28
Section 10.02. Resignation or Removal of Owner Trustee......................................................28
Section 10.03. Successor Owner Trustee......................................................................29
Section 10.04. Merger or Consolidation of Owner Trustee.....................................................30
Section 10.05. Appointment of Co-Trustee or Separate Trustee................................................30
ARTICLE XI
MISCELLANEOUS
Section 11.01. Supplements and Amendments...................................................................31
Section 11.02. No Legal Title to Trust Estate in Certificateholders.........................................32
Section 11.03. Limitations on Rights of Others..............................................................32
Section 11.04. Notices......................................................................................32
Section 11.05. Severability.................................................................................33
Section 11.06. Separate Counterparts........................................................................33
Section 11.07. Successors and Assigns.......................................................................33
Section 11.08. Covenants of the Depositor...................................................................33
Section 11.09. No Petition..................................................................................33
Section 11.10. No Recourse..................................................................................34
Section 11.11. Headings.....................................................................................34
Section 11.12. GOVERNING LAW................................................................................34
Section 11.13. Xxxxxxxx-Xxxxx...............................................................................34
Section 11.14. Acceptance of Terms of Agreement.............................................................34
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EXHIBITS
Exhibit A Form of Trust Certificate...................................................................A-1
Exhibit B Form of Transferor Certificate..............................................................B-1
Exhibit C Form of Investment Letter...................................................................C-1
Exhibit D Form of Rule 144A Letter....................................................................D-1
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This AMENDED AND RESTATED TRUST AGREEMENT, dated as of May 31, 2005, is
between ML ASSET BACKED CORPORATION, a Delaware corporation, as depositor (the
"Depositor"), and U.S. BANK TRUST NATIONAL ASSOCIATION, a national banking
corporation, as owner trustee (the "Owner Trustee").
WHEREAS, the Owner Trustee and the Depositor entered into a Trust
Agreement dated as of August 13, 2004 (the "Original Trust Agreement"); and
WHEREAS, the Original Trust Agreement is being amended and restated as of
May 31, 2005;
NOW, THEREFORE, the Depositor and the Owner Trustee hereby agree that the
Original Trust Agreement shall be amended and restated as follows:
ARTICLE I
DEFINITIONS
Section 1.01. Capitalized Terms. For all purposes of this Agreement, the
following terms have the meanings set forth below:
"Agreement" means this Amended and Restated Trust Agreement, as the same
may be amended, supplemented or otherwise modified from time to time.
"Bankruptcy Action" has the meaning assigned to such term in Section
4.01.
"Certificate Distribution Account" has the meaning assigned to such term
in Section 5.01.
"Certificate of Trust" means the certificate of trust of the Issuer
substantially in the form of Exhibit A to the Original Trust Agreement.
"Certificate Register" and "Certificate Registrar" means the register
mentioned in and the registrar appointed pursuant to Section 3.04.
"Code" means the Internal Revenue Code of 1986, as amended, and the
Treasury Regulations promulgated thereunder.
"Depositor" means ML Asset Backed Corporation, and its successors, in its
capacity as depositor hereunder.
"Distribution Date" means the twenty-fifth (25th) day of each calendar
month or, if such day is not a Business Day, the next succeeding Business Day.
"Expenses" has the meaning assigned to such term in Section 8.02.
"Holder" or "Certificateholder" means a Person in whose name a Trust
Certificate is registered in the Certificate Register; except that when used
in reference to the Notes, "Holder" shall have the meaning provided therefor
under the Indenture.
"Indemnified Parties" has the meaning assigned to such term in Section
8.02.
"Indenture" means the Indenture, dated as of May 31, 2005, among the
Trust, HSBC Bank USA, National Association, as Indenture Trustee and U.S. Bank
National Association, as Securities Administrator, as amended, supplemented or
otherwise modified from time to time.
"Indenture Trustee" means HSBC Bank USA, National Association, a national
banking association, not in its individual capacity, but as Indenture Trustee
under the Indenture, or any successor Indenture Trustee under the Indenture.
"Investment Letter" has the meaning assigned to such term in Section
3.04.
"Notes" means the Class A-1 Notes, the Class A-2a Notes, the Class A-2b
Notes, the Class A-3 Notes, the Class A-4 Notes, the Class B Notes and the
Class C Notes.
"Original Trust Agreement" has the meaning set forth in the recitals.
"Owner Trustee" means U.S. Bank Trust National Association, a national
banking association, not in its individual capacity but solely as owner
trustee under this Agreement, and any successor Owner Trustee hereunder.
"Paying Agent" means any paying agent or co-paying agent appointed
pursuant to Section 3.09 and shall initially be the Owner Trustee.
"Percentage Interest" means, as to any Trust Certificate, the percentage
interest, specified on the face thereof, in the distributions on the Trust
Certificates pursuant to this Agreement.
"Protected Purchaser" has the meaning set forth in Section 8-303 of the
UCC.
"Sale and Servicing Agreement" means the Sale and Servicing Agreement
dated as of May 31, 2005, among the Trust, as issuer, the Depositor, U.S. Bank
National Association, as Master Servicer, and HSBC Bank USA, National
Association, as Indenture Trustee, as the same may be amended, supplemented or
otherwise modified from time to time.
"Secretary of State" means the Secretary of State of the State of
Delaware.
"Securities Act" means the Securities Act of 1933, as amended.
"Securities Administrator" means U.S. Bank National Association, a
national banking association, not in its individual capacity but solely as
Securities Administrator under the Indenture, or any successor Securities
Administrator under the Indenture.
"Similar Law" means any foreign, federal, state or local law with
provisions substantially similar to Title I of ERISA or Section 4975 of the
Code.
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"Statutory Trust Statute" means Chapter 38 of Title 12 of the Delaware
Code, 12 Del. Code xx.xx. 3801 et seq., as the same may be amended from time
to time.
"Transferor Certificate" has the meaning assigned to such term in Section
3.04.
"Treasury Regulations" means regulations, including proposed or temporary
Regulations, promulgated under the Code. References herein to specific
provisions of proposed or temporary regulations shall include analogous
provisions of final Treasury Regulations or other successor Treasury
Regulations.
"Trust Certificates" means the certificates evidencing the beneficial
interest in the Trust, in the form of Exhibit A hereto.
Section 1.02. Other Definitional Provisions.
(a) Capitalized terms used and not otherwise defined herein have the
meanings assigned to them in the Appendix A to the Sale and Servicing
Agreement.
(b) All terms defined in this Agreement and used in any instrument
governed hereby and in any certificate or other document made or delivered
pursuant hereto shall have the respective meanings ascribed thereto herein
unless such terms are otherwise defined in such certificate or other document.
(c) As used in this Agreement and in any certificate or other document
made or delivered pursuant hereto or thereto, accounting terms not defined in
this Agreement or in any such certificate or other document, and accounting
terms partly defined in this Agreement or in any such certificate or other
document to the extent not defined, shall have the respective meanings given
to them under generally accepted accounting principles. To the extent that the
definitions of accounting terms in this Agreement or in any such certificate
or other document are inconsistent with the meanings of such terms under
generally accepted accounting principles, the definitions contained in this
Agreement or in any such certificate or other document shall control.
(d) The words "hereof," "herein," "hereunder" and words of similar import
when used in this Agreement shall refer to this Agreement as a whole and not
to any particular provision of this Agreement; Section and Exhibit references
contained in this Agreement are references to Sections and Exhibits in or to
this Agreement unless otherwise specified; "or" includes "and/or"; and the
term "including" means "including without limitation".
(e) The definitions contained in this Agreement are applicable to the
singular and plural forms of such terms and to the masculine, feminine and
neuter genders of such terms.
(f) Any agreement, instrument or statute defined or referred to herein or
in any instrument or certificate delivered in connection herewith means such
agreement, instrument or statute as from time to time amended, modified or
supplemented and includes (in the case of agreements or instruments)
references to all attachments thereto and instruments incorporated therein;
references to a Person are also to its permitted successors and assigns.
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ARTICLE II
ORGANIZATION
Section 2.01. Name. The Trust heretofore created and continued hereby
is known as "Xxxxxxx Auto Trust Securitization 2005-1," in which name the
Owner Trustee may conduct the business of the Trust, make and execute
contracts and other instruments on behalf of the Trust and xxx and be sued.
Section 2.02. Office. The office of the Trust shall be in care of the
Owner Trustee at the Corporate Trust Office or at such other address in
Delaware as the Owner Trustee may designate by written notice to the
Certificateholders and the Depositor.
Section 2.03. Purposes and Powers. The purpose of the Trust is to engage
in the following activities and the Owner Trustee acting on behalf of the
Trust shall have the power and authority:
(a) to issue the Notes pursuant to the Indenture and the Trust
Certificates pursuant to this Agreement and to sell the Notes and the Trust
Certificates, in each case in accordance with the Basic Documents;
(b) with the proceeds of the sale of the Notes and the Trust
Certificates, to purchase or otherwise acquire the Initial Receivables, to pay
the organizational, start-up and transactional expenses of the Trust and to
pay the balance of such proceeds to the Depositor pursuant to the Sale and
Servicing Agreement;
(c) to assign, grant, transfer, pledge, mortgage and convey the Trust
Estate pursuant to the Indenture and to hold, manage and distribute to the
Certificateholders pursuant to the terms of the Sale and Servicing Agreement
any portion of the Trust Estate released from the Lien of, and remitted to the
Trust pursuant to, the Indenture;
(d) to enter into and perform its obligations under the Basic Documents
to which it is to be a party;
(e) to engage in those activities, including entering into agreements,
that are necessary, suitable or convenient to accomplish the foregoing or are
incidental thereto or connected therewith; and
(f) subject to compliance with the Basic Documents, to engage in such
other activities as may be required in connection with conservation of the
Trust Estate and the making of distributions to the Certificateholders and the
Noteholders.
The Owner Trustee acting on behalf of the Trust is hereby authorized to
engage in the foregoing activities. The Trust shall not engage in any activity
other than in connection with the foregoing or other than as required or
authorized by the terms of this Agreement or the other Basic Documents.
Specifically, the Owner Trustee, on behalf of the Trust, shall have no
authority to engage in any business operation, acquire any assets other than
those specifically included in the Trust Property or the Owner Trust Estate
under Article II of the Sale and
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Servicing Agreement or otherwise vary the assets held by the Trust, except as
authorized by the terms of this Agreement or the other Basic Documents.
Section 2.04. Appointment of Owner Trustee. The Depositor hereby confirms
the appointment of the Owner Trustee as trustee of the Trust effective as of
the date of creation of the Trust, to have all the rights, powers and duties
set forth herein.
The Owner Trustee may engage, in the name of the Trust or in its own name
on behalf of the Trust, in the activities of the Trust, make and execute
contracts on behalf of the Trust and xxx on behalf of the Trust.
Section 2.05. Initial Capital Contribution of Trust Estate. The Depositor
hereby sells, assigns, transfers, conveys and sets over to the Owner Trustee,
as of the date hereof, the sum of $1. The Owner Trustee hereby acknowledges
receipt in trust from the Depositor, as of the date hereof, of the foregoing
contribution, which shall constitute the initial Trust Estate and shall be
deposited in the Certificate Distribution Account. The Depositor shall pay
organizational expenses of the Trust as they may arise or shall, upon the
request of the Owner Trustee, promptly reimburse the Owner Trustee for any
such expenses paid by the Owner Trustee.
Section 2.06. Declaration of Trust. The Owner Trustee hereby declares
that it will hold the Trust Estate in trust upon and subject to the conditions
set forth herein for the use and benefit of the Certificateholders, subject to
the obligations of the Trust under the Basic Documents. Effective as of the
date hereof, the Owner Trustee shall have all rights, powers and duties set
forth herein and in the Statutory Trust Statute with respect to accomplishing
the purposes of the Trust. The Owner Trustee has filed the Certificate of
Trust with the Secretary of State of the State of Delaware.
Section 2.07. Characterization of the Trust for Tax Purposes. It is the
intention of the parties hereto that (i) the Trust constitute a statutory
trust under the Statutory Trust Statute and that this Agreement constitute the
governing instrument of such statutory trust and (ii) for federal, state and
local income and franchise tax purposes, the Trust shall be treated as a
grantor trust of the type described in Treasury Regulation ss.301.7701-4(c),
with the assets of the Trust being the Receivables and other assets held by
the Trust, and the Notes being non-recourse debt of the Certificateholders,
provided that if the Trust is not properly characterized as a grantor trust of
the type described in Treasury Regulation ss.301.7701-4(c) (i.e., if one or
more classes of Notes are treated as equity in the Trust for federal income
tax purposes), the Trust shall be treated for federal, state and local income
and franchise tax purposes as a partnership (other than an association or
publicly traded partnership), with the assets of the partnership being the
Receivables and other assets held by the Trust, the partners of the
partnership being the Certificateholders and the Holders of the Notes that are
treated as equity in the Trust, and the remaining Notes constituting
indebtedness of the partnership. The parties agree that, unless otherwise
required by the appropriate tax authorities, the Trust will file or cause to
be filed annual or other necessary returns, reports and other forms consistent
with the foregoing characterization of the Trust for such tax purposes.
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Section 2.08. Liability of Certificateholders. The Certificateholders
(including the Depositor or any Affiliate thereof) shall be entitled to the
same limitation of personal liability extended to stockholders of private
corporations for profit organized under the general corporation law of the
State of Delaware.
Section 2.09. Title to Trust Property. Subject to the Indenture, legal
title to all the Trust Estate shall be vested at all times in the Owner
Trustee, in its capacity as trustee for the Trust, in accordance with Section
3805(f) of the Statutory Trust Statute, with the same effect as if such
property were held in the name of the Trust as a separate legal entity.
Section 2.10. Situs of Trust. The Trust will be located in the State of
Delaware and administered in the States of Delaware, New York or Minnesota.
All bank accounts maintained by the Owner Trustee on behalf of the Trust shall
be located in the States of Delaware, New York or Minnesota. The Trust shall
not have any employees; provided, however, that nothing herein shall restrict
or prohibit the Owner Trustee from having employees within or without the
State of Delaware. Payments will be received by the Trust only in Delaware,
New York or Minnesota, and payments will be made by the Trust only from
Delaware, New York or Minnesota. The only office of the Trust will be at the
Corporate Trust Office.
Section 2.11. Representations, Warranties and Covenants of the Depositor.
The Depositor hereby represents and warrants to the Owner Trustee that:
(a) The Depositor is duly organized and validly existing as a corporation
in good standing under the laws of the State of Delaware, with power and
authority to own its properties and to conduct its business as such properties
are currently owned and such business is presently conducted.
(b) The Depositor is duly qualified to do business as a foreign
corporation in good standing and has obtained all necessary licenses and
approvals in all jurisdictions in which the ownership or lease of its property
or the conduct of its business shall require such qualifications.
(c) The Depositor has the power and authority to execute and deliver this
Agreement and to carry out its terms; the Depositor has full power and
authority to transfer and assign the property to be transferred and assigned
to and deposited with the Trust and the Depositor has duly authorized such
transfer and assignment and deposit to the Trust by all necessary corporate
action; and the execution, delivery and performance of this Agreement have
been duly authorized by the Depositor by all necessary corporate action.
(d) The Depositor has duly executed and delivered this Agreement, and
this Agreement constitutes a legal, valid and binding obligation of the
Depositor, enforceable against the Depositor, in accordance with its terms.
(e) The consummation of the transactions contemplated by this Agreement
and the fulfillment of the terms hereof do not (i) conflict with, result in
any breach of any of the terms and provisions of, or constitute (with or
without notice or lapse of time) a default under, the certificate of
incorporation or the by-laws of the Depositor, or any indenture, agreement or
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other instrument to which the Depositor is a party or by which it is bound,
(ii) result in the creation or imposition of any Lien upon any of its
properties pursuant to the terms of any such indenture, agreement or other
instrument (other than pursuant to the Basic Documents) or (iii) violate any
law or, to the best of the Depositor's knowledge, any order, rule or
regulation applicable to the Depositor of any court or of any federal or state
regulatory body, administrative agency or other governmental instrumentality
having jurisdiction over the Depositor or its properties.
(f) There are no proceedings or investigations pending or threatened
before any court, regulatory body, administrative agency or other governmental
instrumentality having jurisdiction over the Depositor or its properties (i)
asserting the invalidity of this Agreement, (ii) seeking to prevent the
consummation of any of the transactions contemplated by this Agreement or
(iii) seeking any determination or ruling that might materially and adversely
affect the performance by the Depositor of its obligations under, or the
validity or enforceability of, this Agreement.
(g) The representations and warranties of the Depositor in Section 5.1 of
the Sale and Servicing Agreement are true and correct.
Section 2.12. Federal Income Tax Matters. (a) The Certificateholders
acknowledge that it is their intent and that they understand it is the intent
of the Depositor that, for federal, state and local income and franchise tax
purposes, the Trust shall be treated as a grantor trust of the type described
in Treasury Regulation ss.301.7701-4(c). The Depositor hereby agrees and each
Certificateholder by acceptance of a Trust Certificate agrees to such
treatment and each agrees to take no action inconsistent with such treatment
as a grantor trust. If the Trust is not properly characterized as a grantor
trust of the type described in Treasury Regulation ss.301.7701-4(c) (i.e., to
the extent that one or more classes of Notes are treated as equity for federal
income tax purposes), the Trust will be treated as a partnership (other than
an association or publicly traded partnership) for federal, state and local
income and franchise tax purposes, and income, gain or loss of the Trust for
such month as determined for federal income tax purposes shall be allocated
among the Certificateholders as of the Record Date occurring within such
month, in proportion to their ownership of the Certificate Percentage Interest
on such date.
(b) Each Certificateholder agrees to provide to the Trust (a) an IRS Form
W-9 (or other similar or successor form) as is necessary to establish an
exemption from United States federal backup withholding with respect to such
Certificateholder (i) on or promptly after the date hereof (or, if later, the
date on which it becomes a Certificateholder hereunder) and (ii) upon the
occurrence of any event that would require the amendment or resubmission of
any such Form previously provided hereunder and such other forms or
information in connection therewith reasonably requested by the Trust.
(c) The Trust is authorized to modify the allocations in this paragraph
if necessary or appropriate, in its sole discretion, for the allocations to
fairly reflect the economic income, gain or loss to the Certificateholders, or
as otherwise required by the Code.
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ARTICLE III
TRUST CERTIFICATES AND TRANSFER OF INTERESTS
Section 3.01. Initial Ownership. Upon the formation of the Trust by the
execution of the Original Trust Agreement and until the issuance of the Trust
Certificates, the Depositor shall be the sole beneficiary of the Trust.
Section 3.02. The Trust Certificates.
(a) The Trust Certificates shall be issued in minimum denominations of a
one percent (1%) Percentage Interest in the Trust. The Trust Certificates
shall be executed on behalf of the Trust by manual or facsimile signature of
an authorized officer of the Owner Trustee. Trust Certificates bearing the
manual or facsimile signatures of individuals who were, at the time when such
signatures shall have been affixed, authorized to sign on behalf of the Trust,
shall be validly issued and entitled to the benefit of this Agreement and
shall be valid and binding obligations of the Trust, notwithstanding that such
individuals or any of them shall have ceased to be so authorized prior to the
authentication and delivery of such Trust Certificates or did not hold such
offices at the date of authentication and delivery of such Trust Certificates.
(b) A transferee of a Trust Certificate, if any, shall become a
Certificateholder, shall become bound by this Agreement and shall be entitled
to the rights and subject to the obligations of a Certificateholder hereunder
upon such transferee's acceptance of a Trust Certificate duly registered in
such transferee's name pursuant to Section 3.04.
Section 3.03. Execution, Authentication and Delivery of Trust
Certificates. On the Closing Date, the Owner Trustee shall cause the Trust
Certificates in an aggregate Percentage Interest equal to 100% to be executed
on behalf of the Trust and authenticated by the Owner Trustee on behalf of the
Trust and delivered to or upon the written order of Xxxxxxx Lynch, Pierce,
Xxxxxx & Xxxxx Incorporated, without further action by the Depositor, in
authorized denominations. No Trust Certificate shall entitle the related
Certificateholder to any benefit under this Agreement or be valid for any
purpose unless there shall appear on such Trust Certificate a certificate of
authentication substantially in the form set forth in Exhibit A, executed by
the Owner Trustee, by manual signature; such authentication shall constitute
conclusive evidence that such Trust Certificate shall have been duly
authenticated and delivered hereunder. All Trust Certificates shall be dated
the date of their authentication.
When a Trust Certificate is duly executed and issued by the Owner Trustee
and duly authenticated in accordance with this Agreement, the Trust
Certificate will be fully paid, validly issued, nonassessable and entitled to
the benefits of this Agreement.
Section 3.04. Registration of Certificates; Transfer and Exchange of
Trust Certificates; Limitations on Transfer. (a) The Certificate Registrar
shall keep or cause to be kept, at the office or agency maintained pursuant to
Section 3.08, a Certificate Register in which, subject to such reasonable
regulations as it may prescribe, the Trust shall provide for the registration
of Trust Certificates and of transfers and exchanges of Trust Certificates as
herein provided. The Owner Trustee shall be the initial Certificate Registrar.
No transfer of a Trust
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Certificate shall be recognized except upon registration of such transfer in
the Certificate Register.
The Trust Certificates have not been and will not be registered under the
Securities Act and will not be listed on any exchange. No transfer of a Trust
Certificate shall be made unless such transfer is made pursuant to an
effective registration statement under the Securities Act and any applicable
state securities laws or is exempt from the registration requirements under
the Securities Act and such state securities laws. In the event that a
transfer is to be made in reliance upon an exemption from the Securities Act
and state securities laws, in order to assure compliance with the Securities
Act and such laws, the Certificateholder desiring to effect such transfer and
such Certificateholder's prospective transferee shall each certify to the
Owner Trustee in writing the facts surrounding the transfer in substantially
the forms set forth in Exhibit B (the "Transferor Certificate") and either
Exhibit C (the "Investment Letter") or Exhibit D (the "Rule 144A Letter"). The
Depositor shall provide to any Certificateholder and any prospective
transferee designated by any such Certificateholder, information regarding the
Trust Certificates and, based solely on information received from the Master
Servicer, the Receivables Servicers and, to the extent reasonably obtainable
by the Depositor, such other information as shall be necessary to satisfy the
condition to eligibility set forth in Rule 144A(d)(4) for transfer of any such
Trust Certificate without registration thereof under the Securities Act
pursuant to the registration exemption provided by Rule 144A. Each
Certificateholder desiring to effect such a transfer shall, and does hereby
agree to, indemnify the Trust, the Owner Trustee, and the Depositor against
any liability that may result if the transfer is not so exempt or is not made
in accordance with federal and state securities laws. The Owner Trustee shall
cause each Trust Certificate to contain a legend in the form set forth on the
form of Trust Certificate attached hereto as Exhibit A.
(b) With respect to each transfer of a Trust Certificate, the prospective
transferee shall be deemed to represent the following:
(i) It is not, and each account (if any) for which it is purchasing
the Trust Certificates is not (1) an employee benefit plan, as defined in
Section 3(3) of ERISA, that is subject to Title I of ERISA, (2) a plan
described in Section 4975(e)(1) of the Code that is subject to Section
4975 of the Code, (3) a governmental plan, as defined in Section 3(32) of
ERISA, subject to any federal, State or local law which is, to a material
extent, similar to the provisions of Section 406 of ERISA or Section 4975
of the Code, (4) an entity whose underlying assets include plan assets by
reason of a plan's investment in the entity (within the meaning of
Department of Labor Regulation 29 C.F.R. Section 2510.3-101 or otherwise
under ERISA) or (5) a person investing "plan assets" of any such plan
(including without limitation, for purposes of this clause (5), an
insurance company general account, but excluding any entity registered
under the Investment Company Act of 1940, as amended).
(ii) It understands that any purported transfer of any Trust
Certificate (or any interest therein) to any Person who does not meet the
conditions of paragraph (i) above shall be, to the fullest extent
permitted by law, void ab initio, and the purported transferee in such a
transfer shall not be recognized by the Trust or any other Person as a
Certificateholder for any purpose.
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(c) Upon surrender for registration of transfer of any Trust Certificate
at the office or agency maintained pursuant to Section 3.08 and upon
compliance with any provisions of this Agreement relating to such transfer,
the Owner Trustee shall execute, authenticate and deliver, in the name of the
designated transferee or transferees, one or more new Trust Certificates of a
like Certificate Percentage Interest dated the date of authentication by the
Owner Trustee or any authenticating agent. At the option of a
Certificateholder, Trust Certificates may be exchanged for other Trust
Certificates of a like Certificate Percentage Interest upon surrender of the
Trust Certificates to be exchanged at the office or agency maintained pursuant
to Section 3.08.
Every Trust Certificate presented or surrendered for registration of
transfer or exchange shall be accompanied by a written instrument of transfer
in form satisfactory to the Owner Trustee and the Certificate Registrar, duly
executed by the related Certificateholder or such Certificateholder's attorney
duly authorized in writing. Each Trust Certificate surrendered for
registration of transfer or exchange shall be cancelled and subsequently
disposed of by the Certificate Registrar in accordance with its customary
practice.
No service charge shall be made for any registration of transfer or
exchange of Trust Certificates, but the Owner Trustee or the Certificate
Registrar may require payment of a sum sufficient to cover any tax or
governmental charge that may be imposed in connection with any transfer or
exchange of Certificates.
The preceding provisions of this Section 3.04 notwithstanding, the Owner
Trustee shall not make and the Certificate Registrar need not register any
transfer or exchange of Trust Certificates for a period of 15 days preceding
any Payment Date for any payment with respect to the Trust Certificates.
Section 3.05. Mutilated, Destroyed, Lost or Stolen Trust Certificates.
(a) If (i) any mutilated Trust Certificate shall be surrendered to the
Certificate Registrar, or if the Certificate Registrar shall receive evidence
to its satisfaction of the destruction, loss or theft of any Trust Certificate
and (ii) there shall be delivered to the Certificate Registrar and the Owner
Trustee such security or indemnity as may be required by them to save each of
them harmless, then in the absence of written notice that such Trust
Certificate has been acquired by a protected purchaser, the Owner Trustee, on
behalf of the Trust, shall execute and the Owner Trustee shall authenticate
and deliver, in exchange for or in lieu of any such mutilated, destroyed, lost
or stolen Trust Certificate, a new Trust Certificate of like tenor and
denomination. If, after the delivery of such replacement Certificate or
payment of a destroyed, lost or stolen Certificate, a Protected Purchaser of
the original Certificate in lieu of which such replacement Certificate was
issued presents for payment such original Certificate, the Trust and the Owner
Trustee shall be entitled to recover such replacement Certificate (or such
payment) from the Person to whom such replacement Certificate was delivered or
any assignee of such Person, except a Protected Purchaser, and shall be
entitled to recover upon the security or indemnity provided therefor to the
extent of any loss, damage, cost or expense incurred by the Trust or the Owner
Trustee. In connection with the issuance of any new Trust Certificate under
this Section, the Owner Trustee or the Certificate Registrar may require the
payment of a sum sufficient to cover any tax or other governmental charge that
may be imposed in connection
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therewith. Any duplicate Trust Certificate issued pursuant to this Section
shall constitute conclusive evidence of ownership in the Trust, as if
originally issued, whether or not the lost, stolen or destroyed Trust
Certificate shall be found at any time.
(b) The provisions of this Section are exclusive and shall preclude (to
the extent lawful) all other rights and remedies with respect to the
replacement or payment of mutilated, destroyed, lost or stolen Certificates.
Section 3.06. Persons Deemed Owners. Prior to due presentation of a Trust
Certificate for registration of transfer, the Owner Trustee, the Certificate
Registrar or any Paying Agent may treat the Person in whose name any Trust
Certificate is registered in the Certificate Register as the owner of such
Trust Certificate for the purpose of receiving distributions pursuant to
Section 5.02 and for all other purposes whatsoever, and none of the Owner
Trustee, the Certificate Registrar or any Paying Agent shall be bound by any
notice to the contrary.
Section 3.07. Access to List of Certificateholders' Names and Addresses.
The Owner Trustee shall furnish or cause to be furnished to the Master
Servicer, the Paying Agent and the Depositor, within 15 days after receipt by
the Owner Trustee of a written request therefor from the Master Servicer, the
Paying Agent or the Depositor, a list, in such form as the Master Servicer or
the Depositor may reasonably require, of the names and addresses of the
Certificateholders as of the most recent Record Date. The Certificate
Registrar shall also furnish to the Owner Trustee and the Paying Agent a copy
of such list at any time there is a change therein. If (i) three or more
Certificateholders or (ii) one or more Certificateholders evidencing not less
than 25% of the Certificate Percentage Interests apply in writing to the Owner
Trustee, and such application states that the applicants desire to communicate
with other Certificateholders with respect to their rights under this
Agreement or under the Trust Certificates and such application is accompanied
by a copy of the communication that such applicants propose to transmit, then
the Owner Trustee shall, within five Business Days after the receipt of such
application, afford such applicants access during normal business hours to the
current list of Certificateholders. Each Certificateholder, by receiving and
holding a Trust Certificate, shall be deemed to have agreed not to hold any of
the Depositor, the Certificate Registrar or the Owner Trustee accountable by
reason of the disclosure of its name and address, regardless of the source
from which such information was derived. The Certificate Registrar shall upon
the request of the Owner Trustee provide such list, or access to such list, of
Certificateholders as contemplated by this Section 3.07.
Section 3.08. Maintenance of Office or Agency. The Owner Trustee shall
designate an office or offices or agency or agencies located in the United
States where Trust Certificates may be surrendered for registration of
transfer or exchange and where notices and demands to or upon the Owner
Trustee in respect of the Trust Certificates and the Basic Documents may be
served. The Owner Trustee initially designates the Corporate Trust Office of
the Owner Trustee as the office for such purposes. The Owner Trustee shall
give prompt written notice to the Depositor and the Certificateholders of any
change in the location of the Certificate Register or any such office or
agency.
Section 3.09. Appointment of Paying Agent. The Paying Agent shall make
distributions to Certificateholders from the Certificate Distribution Account
pursuant to Section
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5.02 and shall report the amounts of such distributions to the Owner Trustee.
Any Paying Agent shall have the revocable power to withdraw funds from the
Certificate Distribution Account for the purpose of making the distributions
referred to above. The Owner Trustee may revoke such power and remove the
Paying Agent if the Owner Trustee determines in its sole discretion that the
Paying Agent shall have failed to perform its obligations under this Agreement
in any material respect. The Paying Agent initially shall be the Owner Trustee
or, as provided in the Sale and Servicing Agreement, the Securities
Administrator. As Paying Agent, the Owner Trustee shall hold all sums, if any,
held by it for payment to the Certificateholders in trust for the benefit of
the Certificateholders entitled thereto until such sums shall be paid to such
Certificateholders. Any Paying Agent other than the Owner Trustee shall be
permitted to resign as Paying Agent upon 30 days' prior written notice to the
Owner Trustee. In the event that the Owner Trustee shall no longer be the
Paying Agent, the Owner Trustee shall appoint a successor to act as Paying
Agent (which shall be a bank or trust company). The Owner Trustee shall cause
such successor Paying Agent or any additional Paying Agent appointed hereunder
to execute and deliver to the Owner Trustee an instrument in which such
successor Paying Agent or additional Paying Agent shall agree with the Owner
Trustee that, as Paying Agent, such successor Paying Agent or additional
Paying Agent will hold all sums, if any, held by it for payment to the
Certificateholders in trust for the benefit of the Certificateholders entitled
thereto until such sums shall be paid to such Certificateholders. The Paying
Agent shall return all unclaimed funds to the Owner Trustee and upon
resignation or removal of a Paying Agent such Paying Agent shall also return
all funds in its possession to the Owner Trustee. The provisions of Sections
7.01, 7.03, 7.04, 8.01 and 8.02 shall apply to the Owner Trustee in its role
of Paying Agent and Certificate Registrar, for so long as the Owner Trustee
shall act as Paying Agent and Certificate Registrar and, to the extent
applicable, to any other paying agent appointed hereunder. Any reference in
this Agreement to the Paying Agent shall include any co-paying agent unless
the context requires otherwise.
Section 3.10. Definitive Trust Certificates. The Trust Certificates, upon
original issuance, will be issued in the form of a typewritten Trust
Certificate or Trust Certificates in substantially the form attached hereto as
Exhibit A to be delivered to the related Certificateholders, by, or on behalf
of, the Trust. Such Trust Certificate or Trust Certificates shall be
registered on the Certificate Register in the name of the Holder thereof. The
Trust Certificates shall be printed, lithographed, typewritten or engraved or
may be produced in any other manner as is reasonably acceptable to the Owner
Trustee, as evidenced by its execution thereof.
Section 3.11. Certificates Nonassessable and Fully Paid.
Certificateholders shall not be personally liable for obligations of the
Trust. The interests represented by the Trust Certificates shall be
nonassessable for any losses or expenses of the Trust or for any reason
whatsoever, and, upon the authentication thereof by the Owner Trustee pursuant
to Section 3.03, 3.04 or 3.05, the Trust Certificates are and shall be deemed
fully paid.
ARTICLE IV
ACTIONS BY OWNER TRUSTEE
Section 4.01. Prior Notice with Respect to Certain Matters. With respect
to the following matters, the Owner Trustee shall not take action unless at
least 30 days before the
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taking of such action, the Owner Trustee shall have notified the
Certificateholders of record as of the preceding Record Date in writing of the
proposed action and such Certificateholders specified in Section 4.04 hereof
shall not have notified the Owner Trustee in writing prior to the thirtieth
30th day after such notice is given that such Certificateholders have withheld
consent or provided alternative direction:
(a) the initiation of any claim or lawsuit by the Owner Trustee (except
claims or lawsuits brought in connection with the collection of the
Receivables) and the compromise of any action, claim or lawsuit brought by or
against the Owner Trustee (except with respect to the aforementioned claims or
lawsuits for collection of the Receivables);
(b) the election by the Owner Trustee to file an amendment to the
Certificate of Trust (unless such amendment is required to be filed under the
Statutory Trust Statute);
(c) the amendment of the Indenture by a supplemental indenture or any
other change to this Agreement or any other Basic Document in circumstances
where the consent of any Noteholder is required;
(d) the amendment of the Indenture by a supplemental indenture or any
other change to this Agreement or any other Basic Document in circumstances
where the consent of any Noteholder is not required and such amendment would
materially adversely affect the interests of the Certificateholders;
(e) the appointment pursuant to the Indenture of a successor Note
Registrar, Paying Agent or Indenture Trustee or pursuant to this Agreement of
a successor Certificate Registrar, or the consent to the assignment by the
Note Registrar, Paying Agent, Indenture Trustee or Certificate Registrar of
its obligations under the Indenture or this Agreement, as applicable;
(f) the consent to the calling or waiver of any default of any Basic
Document;
(g) the consent to the assignment by the Indenture Trustee or the Master
Servicer of their respective obligations under any Basic Document, unless
permitted in the Basic Documents;
(h) except as provided in Article IX hereof, dissolve, terminate or
liquidate the Trust in whole or in part;
(i) merge or consolidate the Trust with or into any other entity, or
convey or transfer all or substantially all of the Trust's assets to any other
entity;
(j) cause the Trust to incur, assume or guaranty any indebtedness other
than as set forth in this Agreement or the other Basic Documents;
(k) do any act that conflicts with any other Basic Document;
(l) do any act that would make it impossible to carry on the ordinary
business of the Trust as described in Section 2.03;
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(m) confess a judgment against the Trust;
(n) possess Trust assets, or assign the Trust's right to property, for
other than a Trust purpose;
(o) cause the Trust to lend any funds to any entity, unless permitted in
the Basic Documents; or
(p) change the Trust's purpose and powers from those set forth in this
Trust Agreement.
In addition, the Trust shall not commingle its assets with those of any
other entity except, to the extent permitted hereunder, with the Owner
Trustee. The Trust shall maintain its financial and accounting books and
records separate from those of any other entity. Except as expressly set forth
herein, the Trust shall not pay the indebtedness, operating expenses and
liabilities of any other entity. The Trust shall maintain appropriate minutes
or other records of all appropriate actions and shall maintain its office
separate from the offices of the Depositor and the Master Servicer.
The Owner Trustee shall not have the power, except upon the written
direction of the Certificateholders pursuant to Section 4.04, and to the
extent otherwise consistent with the Basic Documents and permitted by
applicable law, to (i) institute proceedings to have the Owner Trustee or the
Trust declared or adjudicated bankrupt or insolvent, (ii) consent to the
institution of bankruptcy or insolvency proceedings against the Owner Trustee
or the Trust, (iii) file a petition or consent to a petition seeking
reorganization or relief on behalf of the Owner Trustee or the Trust under any
applicable federal or state law relating to bankruptcy, (iv) consent to the
appointment of a conservator, receiver, liquidator, assignee, trustee,
sequestrator (or any similar official) of the Owner Trustee or the Trust or a
substantial portion of the property of the Owner Trustee or the Trust, (v)
make any assignment for the benefit of the Owner Trustee's or the Trust's
creditors, (vi) cause the Owner Trustee or the Trust to admit in writing its
inability to pay its debts generally as they become due, or (vii) take any
action, or cause the Owner Trustee or the Trust to take any action, in
furtherance of any of the foregoing (any of the above, a "Bankruptcy Action").
So long as the Indenture remains in effect and to the fullest extent permitted
by applicable law, no Certificateholder shall have the power to take, and
shall not take, any Bankruptcy Action with respect to the Owner Trustee or the
Trust or direct the Owner Trustee to take any Bankruptcy Action with respect
to the Owner Trustee or the Trust. Additionally, the Owner Trustee shall not
have the power to commence a Bankruptcy Action without the unanimous prior
approval of all Certificateholders and the delivery to the Owner Trustee by
each such Certificateholder of a certification certifying that such
Certificateholder reasonably believes that the Trust is insolvent.
Section 4.02. Action by Certificateholders with Respect to Certain
Matters. The Owner Trustee shall not have the power, except upon the written
direction of (a) the Certificateholders owning 25% Certificate Percentage
Interest, to remove the Master Servicer pursuant to Section 7.1 under the Sale
and Servicing Agreement or (b) Certificateholders owning 100% Certificate
Percentage Interest, to amend the Sale and Servicing Agreement pursuant to the
proviso to Section 9.1(b). In addition, the Owner Trustee shall not have the
power, except upon
14
the written direction of the Certificateholders, except as expressly provided
in the Basic Documents, sell the Receivables after the termination of the
Indenture.
Section 4.03. Restrictions on Certificateholders' Power. The
Certificateholders shall not direct the Owner Trustee to take or to refrain
from taking any action if such action or inaction would be contrary to any
obligation of the Trust or the Owner Trustee under this Agreement (including
Section 2.03 hereof) or any of the other Basic Documents; nor shall the Owner
Trustee be obligated to follow any such direction, if given.
Section 4.04. Majority Control. Except as expressly provided herein, any
action that may be taken by the Certificateholders under this Agreement may be
taken by the Certificateholders evidencing not less than a majority of the
Certificate Percentage Interests. Except as expressly provided herein, any
written notice of the Certificateholders delivered pursuant to this Agreement
shall be effective if signed by Holders of Trust Certificates evidencing not
less than a majority of the Certificate Percentage Interests at the time of
the delivery of such notice.
ARTICLE V
APPLICATION OF TRUST FUNDS; CERTAIN DUTIES
Section 5.01. Establishment of Trust Account. The Paying Agent shall
establish and maintain on behalf of the Trust an Eligible Deposit Account (the
"Certificate Distribution Account"), bearing a designation clearly indicating
that the funds deposited therein are held for the benefit of the
Certificateholders. The title of the Certificate Distribution Account shall be
"Merrill Auto Trust Securitization 2005-1: Certificate Distribution Account
for the benefit of the Certificateholders."
The Trust shall possess all right, title and interest in all funds on
deposit from time to time in the Certificate Distribution Account and in all
proceeds thereof. Except as otherwise expressly provided herein, the
Certificate Distribution Account shall be under the sole dominion and control
of the Owner Trustee, on behalf of the Trust, for the benefit of the
Certificateholders. If, at any time, the Certificate Distribution Account
ceases to be an Eligible Deposit Account, the Owner Trustee (or the Depositor
on behalf of the Owner Trustee, if the Certificate Distribution Account is not
then held by the Owner Trustee or an affiliate thereof) shall within ten
Business Days (or such longer period, not to exceed 30 calendar days, as to
which each Rating Agency may consent) cause the Paying Agent to establish a
new Certificate Distribution Account as an Eligible Deposit Account and shall
transfer any cash and/or any investments from the account that is no longer an
Eligible Deposit Account to such new Certificate Distribution Account.
Section 5.02. Application of Trust Funds.
(a) On each Distribution Date, the Paying Agent shall distribute to
Certificateholders amounts deposited in the Certificate Distribution Account
pursuant to Sections 8.2(c)(i) and the second last sentence of Section 8.2(d)
of the Indenture with respect to such Distribution Date.
15
(b) On each Distribution Date, the Owner Trustee shall cause the Paying
Agent to send to each Certificateholder the statement or statements provided
to the Owner Trustee by the Indenture Trustee pursuant to Section 4.7 of the
Sale and Servicing Agreement with respect to such Distribution Date.
(c) In the event that any withholding tax is imposed on the Trust's
payment (or allocations of income) to a Certificateholder, such tax shall
reduce the amount otherwise distributable to such Certificateholder in
accordance with this Section. The Owner Trustee and the Paying Agent are
hereby authorized and directed to retain from amounts otherwise distributable
to the Certificateholders sufficient funds for the payment of any tax that is
legally owed by the Trust (but such authorization shall not prevent the Owner
Trustee or the Paying Agent from contesting any such tax in appropriate
proceedings and withholding payment of such tax, if permitted by law, pending
the outcome of such proceedings). The amount of any withholding tax imposed
with respect to a Certificateholder shall be treated as cash distributed to
such Certificateholder at the time it is withheld by the Owner Trustee on
behalf of the Trust and remitted to the appropriate taxing authority. If there
is a possibility that withholding tax is payable with respect to a
distribution (such as a distribution to a non-U.S. Certificateholder), the
Owner Trustee or the Paying Agent may in its sole discretion withhold such
amounts in accordance with this paragraph. If a Certificateholder wishes to
apply for a refund of any such withholding tax, the Owner Trustee and each
Paying Agent shall reasonably cooperate with such Certificateholder in making
such claim so long as such Certificateholder agrees to reimburse the Owner
Trustee and each Paying Agent for any out of pocket expenses incurred.
(d) Any Certificateholder which is organized under the laws of a
jurisdiction outside the United States shall, on or prior to the date such
Certificateholder becomes a Certificateholder, so notify the Owner Trustee and
the Paying Agent and either (i) provide the Owner Trustee and the Paying Agent
with Internal Revenue Service Form X-0XXX, X-0XXX, W-8IMY (including all
required attachments thereto) or other similar forms, as appropriate, or (ii)
notify the Owner Trustee and the Paying Agent that it is not entitled to an
exemption from United States withholding tax or a reduction in the rate
thereof on payments of interest. Any such Certificateholder agrees by its
acceptance of a Trust Certificate, on an ongoing basis, to provide like
certification for each taxable year and to notify the Owner Trustee and the
Paying Agent should subsequent circumstances arise affecting the information
provided the Owner Trustee in clauses (a) and (b) above. The Owner Trustee and
the Paying Agent shall be fully protected in relying upon, and each
Certificateholder by its acceptance of a Trust Certificate hereunder agrees to
indemnify and hold the Owner Trustee and the Paying Agent harmless against all
claims or liability of any kind arising in connection with or related to the
Owner Trustee's and the Paying Agent's reliance upon any documents, forms or
information provided by any Certificateholder to the Owner Trustee.
Section 5.03. Method of Payment. Subject to Section 9.01(c),
distributions required to be made to Certificateholders on any Distribution
Date shall be made to each Certificateholder of record on the preceding Record
Date either by wire transfer, in immediately available funds, to the account
of such Certificateholder at a bank or other entity having appropriate
facilities therefor, if such Certificateholder shall have provided to the
Certificate Registrar and the Paying Agent appropriate written instructions at
least five Business Days prior
16
to such Distribution Date or, if not, by check mailed to such
Certificateholder at the address of such Certificateholder appearing in the
Certificate Register.
Section 5.04. No Segregation of Moneys; No Interest. Subject to Sections
5.01 and 5.02, moneys received by the Owner Trustee hereunder need not be
segregated in any manner except to the extent required by law or the Sale and
Servicing Agreement, and may be deposited under such general conditions as may
be prescribed by law, and the Owner Trustee shall not be liable for any
interest thereon.
Section 5.05. Accounting and Reports to Certificateholders, the Internal
Revenue Service and Others. The Trust shall (a) maintain (or cause to be
maintained) the books of the Trust on a calendar year basis and the accrual
method of accounting, (b) deliver (or cause to delivered) to each
Certificateholder each Investor Report delivered to the Owner Trustee pursuant
to Section 3.8 of the Sale and Servicing Agreement, (c) deliver (or cause to
delivered) to each Certificateholder, as may be required by the Code and
applicable Treasury Regulations, such information as may be required
(including providing a Schedule K-1 to each partner if the Trust is required
to be treated as a partnership for federal income tax purposes) to enable each
Certificateholder to prepare its federal and state income tax returns, (d)
prepare (or cause to be prepared), file (or cause to be filed) such tax
returns relating to the Trust (including a partnership information return, IRS
Form 1065 if the Trust is required to be treated as a partnership for federal
income tax purposes) and make such elections as from time to time may be
required or appropriate under any applicable state or federal statute or any
rule or regulation thereunder so as to maintain the Trust's characterization,
(e) cause such tax returns to be signed in the manner required by law and (f)
collect or cause to be collected any withholding tax as described in and in
accordance with Section 5.02(c) with respect to income or distributions to
Certificateholders. The Trust or the tax matters partner shall elect under
Section 1278 of the Code to include in income currently any market discount
that accrues with respect to the Receivables. The Trust shall not make the
election provided under Section 754 of the Code, if applicable.
Section 5.06. Signature on Returns; Tax Matters Partner.
(a) The Owner Trustee shall sign, on behalf of the Trust, the tax returns
of the Trust, if any, unless applicable law requires a Certificateholder to
sign such documents.
(b) In the event that the Trust is required to be treated as a
partnership for federal income tax purposes, the Certificateholder holding a
majority of the Certificate Percentage Interest shall be designated the "tax
matters partner" of the Trust pursuant to Section 6231(a)(7)(A) of the Code.
ARTICLE VI
AUTHORITY AND DUTIES OF OWNER TRUSTEE
Section 6.01. General Authority. The Owner Trustee is authorized and
directed to execute and deliver the Basic Documents to which the Trust is to
be a party and each certificate or other document attached as an exhibit to or
contemplated by the Basic Documents to which the Trust is to be a party, in
each case as evidenced conclusively by the Owner
17
Trustee's execution thereof. In addition to the foregoing, the Owner Trustee
is authorized to take all actions required of the Trust pursuant to the Basic
Documents. The Owner Trustee is further authorized from time to time to take
such action as the Depositor or the Administrator directs with respect to and
in accordance with the Basic Documents (except to the extent that this
Agreement expressly requires the consent of Certificateholders for such
action, in which case the Owner Trustee shall not take such action without
such consent).
Section 6.02. General Duties. It shall be the duty of the Owner Trustee
to discharge (or cause to be discharged) all of its responsibilities pursuant
to the terms of this Agreement and the Basic Documents to which the Trust is a
party and to administer the Trust in the interest of the Certificateholders,
subject to the Basic Documents and in accordance with the provisions of this
Agreement.
Section 6.03. Action upon Instruction.
(a) Subject to Article IV and in accordance with the terms of the Basic
Documents, the Certificateholders may, by written instruction, direct the
Owner Trustee in the management of the Trust. Such direction may be exercised
at any time by written instruction of the Certificateholders pursuant to
Article IV.
(b) The Owner Trustee shall not be required to take any action hereunder
or under any Basic Document if the Owner Trustee shall have reasonably
determined, or shall have been advised by counsel, that such action is likely
to result in liability on the part of the Owner Trustee or is contrary to the
terms hereof or of any Basic Document or is otherwise contrary to law.
(c) Whenever the Owner Trustee is unable to decide between alternative
courses of action permitted or required by the terms of this Agreement or
under any Basic Document, the Owner Trustee shall promptly give notice (in
such form as shall be appropriate under the circumstances) to the
Certificateholders of record as of the preceding Record Date requesting
instruction as to the course of action to be adopted, and to the extent the
Owner Trustee acts in good faith in accordance with any written instruction of
such Certificateholders received, the Owner Trustee shall not be liable on
account of such action to any Person. If the Owner Trustee shall not have
received appropriate instruction within ten (10) days of such notice (or
within such shorter period of time as reasonably may be specified in such
notice or may be necessary under the circumstances) it may, but shall be under
no duty to, take or refrain from taking such action not inconsistent with this
Agreement or the Basic Documents, as it shall deem to be in the best interests
of the Certificateholders, and shall have no liability to any Person for such
action or inaction.
(d) In the event that the Owner Trustee is unsure as to the application
of any provision of this Agreement or any Basic Document or any such provision
is ambiguous as to its application, or is, or appears to be, in conflict with
any other applicable provision, or in the event that this Agreement permits
any determination by the Owner Trustee or is silent or is incomplete as to the
course of action that the Owner Trustee is required to take with respect to a
particular set of facts, the Owner Trustee may give notice (in such form as
shall be appropriate under the circumstances) to the Certificateholders of
record as of the preceding Record Date requesting
18
instruction and, to the extent that the Owner Trustee acts in good faith in
accordance with any such instruction received or, if instructed not to act, in
good faith refrains from acting, the Owner Trustee shall not be liable, on
account of such action or inaction, to any Person. If the Owner Trustee shall
not have received appropriate instruction within ten days of such notice (or
within such shorter period of time as reasonably may be specified in such
notice or may be necessary under the circumstances) it may, but shall be under
no duty to, take or refrain from taking such action not inconsistent with this
Agreement or the other Basic Documents, as it shall deem to be in the best
interests of the Certificateholders, and shall have no liability to any Person
for such action or inaction.
Section 6.04. No Duties Except as Specified in this Agreement or in
Instructions. The Owner Trustee shall not have any duty or obligation to
manage, make any payment with respect to, register, record, sell, dispose of,
or otherwise deal with the Trust Estate, or to otherwise take or refrain from
taking any action under, or in connection with, any document contemplated
hereby to which the Owner Trustee or the Trust is a party, except as expressly
provided by the terms of this Agreement or in any document or written
instruction received by the Owner Trustee pursuant to Section 6.03; and no
implied duties or obligations shall be read into this Agreement or any other
Basic Document against the Owner Trustee. The Owner Trustee shall have no
responsibility for filing any financing or continuation statement in any
public office at any time or to otherwise perfect or maintain the perfection
of any security interest or Lien granted to it hereunder or to prepare or file
any Commission filing for the Trust or to record this Agreement or any other
Basic Document. The Owner Trustee nevertheless agrees that it will, at its own
cost and expense, promptly take all action as may be necessary to discharge
any Liens on any part of the Trust Property that result from actions by, or
claims against, the Owner Trustee in its individual capacity that are not
related to the ownership or the administration of the Trust Property.
Section 6.05. No Action Except Under Specified Documents or Instructions.
The Owner Trustee shall not manage, control, use, sell, dispose of or
otherwise deal with any part of the Trust Property except (i) in accordance
with the powers granted to and the authority conferred upon the Owner Trustee
pursuant to this Agreement, (ii) in accordance with the Basic Documents and
(iii) in accordance with any document or instruction delivered to the Owner
Trustee pursuant to any provision of this Agreement.
Section 6.06. Restrictions. The Owner Trustee shall not take any action
(a) that is inconsistent with the purposes of the Trust set forth in Section
2.03 or (b) that, to the actual knowledge of the Owner Trustee would result in
the Trust's becoming taxable as a corporation for federal income tax purposes.
The Certificateholders shall not direct the Owner Trustee to take action that
would violate the provisions of this Section.
Section 6.07. Administrative Duties.
(a) Subject to the restrictions contained in Article IV, the Owner
Trustee shall prepare or shall cause the preparation by other appropriate
Persons (and such preparation shall not be the responsibility of the Seller,
the Administrator, the Depositor, the Indenture Trustee or the Master
Servicer) of all such documents, reports, filings, instruments, certificates
and opinions as it shall be the duty of the Trust to prepare, file or deliver
pursuant to the Indenture with respect
19
to the following matters under the Indenture (parenthetical section references
are to sections of the Indenture):
(i) (a) the appointment of a successor Note Registrar and (b) giving
the Indenture Trustee notice of any appointment of a new Note Registrar
and the location, or change in location, of the Note Registrar (Section
2.5);
(ii) the delivery for cancellation of any Note delivered to the
Issuer for cancellation, and the direction to destroy or return such Note
(Section 2.9);
(iii) the preparation of Definitive Notes in accordance with the
instructions of the Clearing Agency (Section 2.13);
(iv) the designation of an office in the Borough of Manhattan, City
of New York, for registration of transfer or exchange of Notes (Section
3.2);
(v) the preparation of an Issuer Order directing the Paying Agent to
deposit with the Securities Administrator all sums held in trust by such
Paying Agent (Section 3.3 and 4.3);
(vi) the preparation of an Issuer Order directing the Securities
Administrator to provide notification of any unclaimed monies and
repayments (Section 3.3);
(vii) the filing of all supplements and amendments to the Indenture,
instruments of further assurance and other instruments and the taking of
such other action as is necessary or advisable to protect the Trust
Estate, including the preparation and filing of any financing statements
and continuation statements (Section 3.5);
(viii) the annual delivery of Opinions of Counsel as to the Trust
Estate, and the and the annual delivery of the Officer's Certificate and
certain other statements as to compliance with the Indenture (Sections
3.6 and 3.9);
(ix) the preparation and obtaining of documents and instruments
required for the release of the Issuer from its obligations under the
Indenture (Section 3.10(b));
(x) the execution of any further instruments and the performance of
any acts reasonably necessary to carry out more effectively the purpose
of the Indenture (Section 3.17);
(xi) upon its actual knowledge of such, the delivery to the
Indenture Trustee of written notice in the form of an Officer's
Certificate of any event that with the giving of notice and the lapse of
time would become an Event of Default under clause (iii) of Section 5.1
of the Indenture (Section 5.1);
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(xii) the performance of any lawful action as the Controlling Party
may request to compel or secure the performance and observance by the
Seller of each of its obligations to the Issuer in the Basic Documents
(Section 5.16);
(xiii) the preparation of any written instruments required to
confirm more fully the authority of any co-trustee or separate trustee
and any written instructions necessary in connection with the resignation
or removal of any co-trustee or separate trustee (Sections 6.8 and 6.10);
(xiv) receiving and administering requests of Noteholders for the
current list of Noteholders (Section 7.2);
(xv) upon its actual knowledge of such, the notification to the
Indenture Trustee if and when the Notes are listed on any stock exchange
(Section 7.4);
(xvi) the delivery of new Notes conforming to any supplemental
indenture (Section 9.6);
(xvii) the duty to furnish to the Rating Agencies and the Indenture
Trustee notice of redemption of Notes, if the Master Servicer has not
previously done so (Section 10.1);
(xviii) the duty to notify Noteholders of redemption of the Notes or
to cause the Indenture Trustee to provide such notification (Section
10.2);
(xix) the preparation and delivery of all Officer's Certificates and
Independent Certificates with respect to any requests by the Issuer to
the Indenture Trustee to take any action under the Indenture (Section
11.1(a));
(xx) the preparation and delivery of all Officer's Certificates and
the obtaining of Independent Certificates, if necessary, for the release
of property from the lien of the Indenture (Section 11.1(b)); and
(xxi) the preparation and delivery to Noteholders and the Indenture
Trustee of any agreements or requests by the Noteholders with respect to
alternate payment and notice provisions (Section 11.6).
(b) The Owner Trustee shall receive as compensation for its services
hereunder such fees as have been separately agreed upon before the date hereof
among the Depositor and the Owner Trustee, and the Owner Trustee shall be
reimbursed for its other reasonable expenses hereunder in the priority set
forth in Section 8.2 in the Indenture. In performing its duties under Section
5.05 or 6.07, the Owner Trustee shall be entitled to the indemnification
provided by the Issuer under Section 8.02 of this Agreement, in the priority
set forth in Section 8.2 of the Indenture.
(c) It is understood and agreed that the Owner Trustee shall be entitled
to engage outside counsel, independent accountants and other experts to assist
the Owner Trustee in connection with the performance of its duties set forth
in Sections 5.05 and 6.07, including the
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preparation of all tax reports and returns, securities law filings, Opinions
of Counsel and Independent Certificates and the Owner Trustee shall be
reimbursed for the expenses of such experts in accordance with the priority
set forth in Section 8.2 of the Indenture. The Owner Trustee shall not be
obligated to engage any expert or perform any duty as required under Sections
5.05 and 6.07 for which reimbursement would exceed $1,000 until such amount
has been paid to the Owner Trustee, if payment of such reimbursable amount is
required of the Owner Trustee prior to the next Distribution Date.
(d) The Depositor and the Master Servicer shall furnish to the Owner
Trustee from time to time such additional information regarding the Trust or
the Basic Documents as the Owner Trustee shall reasonably request. The Note
Registrar will furnish or cause to be furnished to the Indenture Trustee and
the Owner Trustee at such times as the Indenture Trustee or the Owner Trustee
may request in writing, within thirty days after receipt by the Note Registrar
of any such request, a list, in such form as the Indenture Trustee or Owner
Trustee may reasonably require, of the names and addresses of the Holders of
Notes as of a date not more than ten days prior to the time such list is
furnished; provided, however, that so long as the Indenture Trustee is the
Note Registrar, no such list shall be required to be furnished to the
Indenture Trustee.
(e) The Owner Trustee shall not be responsible for taking any action with
respect to this Section 6.07 unless a responsible officer in the Corporate
Trust Administration Department of the Owner Trustee has actual knowledge or
has received written notice of the need to take such action.
(f) The rights and protections afforded to the Owner Trustee pursuant to
Article VII of this Agreement shall also be afforded to the Owner Trustee with
respect to the performance of its administrative duties under this Section
6.07.
ARTICLE VII
CONCERNING THE OWNER TRUSTEE
Section 7.01. Acceptance of Trusts and Duties. The Owner Trustee accepts
the trusts hereby created and agrees to perform its duties hereunder with
respect to such trusts, but only upon the terms of this Agreement. The Owner
Trustee also agrees to disburse all moneys actually received by it
constituting part of the Trust Estate upon the terms of the Basic Documents
and this Agreement. The Owner Trustee, in its individual capacity, shall not
be answerable or accountable hereunder or under any Basic Document under any
circumstances, except (i) for its own willful misconduct or gross negligence
or (ii) in the case of the inaccuracy of any representation or warranty
contained in Section 7.03 expressly made by the Owner Trustee in its
individual capacity. In particular, but not by way of limitation (and subject
to the exceptions set forth in the preceding sentence):
(a) the Owner Trustee shall not be liable for any error of judgment made
by a Trust Officer of the Owner Trustee;
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(b) the Owner Trustee shall not be liable with respect to any action
taken or omitted to be taken by it in accordance with the instructions of the
Depositor, the Administrator or any Certificateholder;
(c) no provision of this Agreement or any other Basic Document shall
require the Owner Trustee to expend or risk funds or otherwise incur any
financial liability in the performance of any of its rights or powers
hereunder or under any Basic Document if the Owner Trustee shall have
reasonable grounds for believing that repayment of such funds or adequate
indemnity against such risk or liability is not reasonably assured or provided
to it;
(d) under no circumstances shall the Owner Trustee be liable for
indebtedness evidenced by or arising under any of the Basic Documents,
including the principal of and interest on the Notes;
(e) the Owner Trustee shall not be responsible for or in respect of the
validity or sufficiency of this Agreement or for the due execution hereof by
the Depositor or for the form, character, genuineness, sufficiency, value or
validity of any of the Trust Estate, or for or in respect of the validity or
sufficiency of the Basic Documents, other than the certificate of
authentication on the Trust Certificates, and the Owner Trustee, in its
individual capacity, shall in no event assume or incur any liability, duty or
obligation to any Noteholder or to any Certificateholder, other than as
expressly provided for herein or expressly agreed to in the other Basic
Documents;
(f) the Owner Trustee shall not be responsible for monitoring the
performance of, and shall not be liable for the default or misconduct of the
Depositor, the Master Servicer, the Indenture Trustee, the Administrator or
any other Person under any of the Basic Documents or otherwise, and the Owner
Trustee shall have no obligation or liability to perform the obligations of
the Trust under this Agreement or the Basic Documents that are required to be
performed by the Indenture Trustee under the Indenture or the Depositor or the
Master Servicer under the Sale and Servicing Agreement or the Administrator
under the Administration Agreement; and
(g) the Owner Trustee shall be under no obligation to exercise any of the
rights or powers vested in it by this Agreement, or to institute, conduct or
defend any litigation under this Agreement or otherwise or in relation to this
Agreement or any Basic Document, at the request, order or direction of any of
the Certificateholders, unless such Certificateholders have offered to the
Owner Trustee security, in its individual capacity, or indemnity satisfactory
to it against the costs, expenses and liabilities that may be incurred by the
Owner Trustee, in its individual capacity, therein or thereby. The right of
the Owner Trustee to perform any discretionary act enumerated in this
Agreement or in any Basic Document shall not be construed as a duty, and the
Owner Trustee shall not be answerable for other than its gross negligence or
willful misconduct in the performance of any such act.
Section 7.02. Furnishing of Documents. The Owner Trustee shall furnish to
the Certificateholders, promptly upon receipt of a written request therefor,
duplicates or copies of all reports, notices, requests, demands, certificates,
financial statements and any other instruments furnished to the Owner Trustee
under the Basic Documents.
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Section 7.03. Representations and Warranties. The Owner Trustee, in its
individual capacity, hereby represents and warrants to the Depositor, for the
benefit of the Certificateholders, that:
(a) It is a national banking association duly organized and validly
existing in good standing under the laws of the United States. It has all
requisite corporate power and authority to execute, deliver and perform its
obligations under this Agreement.
(b) It has taken all corporate action necessary to authorize the
execution and delivery by it of this Agreement and the other Basic Documents,
and this Agreement and the other Basic Documents will be executed and
delivered by one of its officers who is duly authorized to execute and deliver
this Agreement and the other Basic Documents on its behalf.
(c) Neither the execution or the delivery by it of this Agreement, nor
the consummation by it of the transactions contemplated hereby, nor compliance
by it with any of the terms or provisions hereof will contravene any federal
or Delaware law, governmental rule or regulation governing the banking or
trust powers of the Owner Trustee or any judgment or order binding on it, or
constitute any default under its charter documents or bylaws or any indenture,
mortgage, contract, agreement or instrument to which it is a party or by which
any of its properties may be bound.
(d) It is a corporation satisfying the provisions of Section 3807(a) of
the Statutory Trust Statute; it is a national banking association duly
organized and validly existing in good standing under the laws of the United
States; it is authorized to exercise corporate trust powers; having a combined
capital and surplus of at least $50,000,000 and subject to supervision or
examination by federal or state authorities; and it has (or has a parent that
has) time deposits that are rated at least "A-1" by Standard & Poor's and
"Prime-1" by Moody's or is otherwise acceptable to each Rating Agency.
Section 7.04. Reliance; Advice of Counsel.
(a) The Owner Trustee (either in its individual capacity or as Owner
Trustee) shall incur no liability to anyone in acting upon any signature,
instrument, notice, resolution, request, consent, order, certificate, report,
opinion, bond, or other document or paper believed by it to be genuine and
believed by it to be signed by the proper party or parties. The Owner Trustee
may accept a certified copy of a resolution of the board of directors or other
governing body of any corporate party as conclusive evidence that such
resolution has been duly adopted by such body and that the same is in full
force and effect. As to any fact or matter the method of determination of
which is not specifically prescribed herein, the Owner Trustee may for all
purposes hereof rely on a certificate, signed by the president or any vice
president or by the treasurer or other authorized officers of the relevant
party, as to such fact or matter, and such certificate shall constitute full
protection to the Owner Trustee for any action taken or omitted to be taken by
it in good faith in reliance thereon.
(b) In the exercise or administration of the trusts hereunder and in the
performance of its duties and obligations under this Agreement or the Basic
Documents, the Owner Trustee (i) may act directly or through its agents or
attorneys pursuant to agreements
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entered into with any of them, and the Owner Trustee shall not be liable for
the conduct or misconduct of such agents or attorneys if such agents or
attorneys shall have been selected by the Owner Trustee with reasonable care,
and (ii) may consult with counsel, accountants and other skilled Persons to be
selected with reasonable care and employed by it. The Owner Trustee shall not
be liable for anything done, suffered or omitted reasonably and in good faith
by it in accordance with the written opinion or advice of any such counsel,
accountants or other such Persons.
Section 7.05. Not Acting in Individual Capacity. Except as expressly
provided in this Article VII, in accepting the trusts hereby created, U.S.
Bank Trust National Association acts solely as Owner Trustee hereunder and not
in its individual capacity, and all Persons having any claim against the Owner
Trustee by reason of the transactions contemplated by this Agreement or any
Basic Document shall look only to the Trust Property for payment or
satisfaction thereof.
Section 7.06. Owner Trustee Not Liable for Trust Certificates or for
Receivables. The recitals contained herein and in the Trust Certificates
(other than the signature and countersignature of the Owner Trustee on the
Trust Certificates) shall be taken as the statements of the Depositor, and the
Owner Trustee assumes no responsibility for the correctness thereof. Except as
set forth in Section 7.03, the Owner Trustee makes no representations as to
the validity or sufficiency of this Agreement, of any Basic Document or of the
Trust Certificates (other than the signature and countersignature of the Owner
Trustee on the Trust Certificates) or the Notes, or of any Receivable or
related documents. The Owner Trustee shall at no time have any responsibility
or liability for or with respect to the legality, validity and enforceability
of any Receivable or the perfection and priority of any security interest
created by any Receivable in any Financed Vehicle or the maintenance of any
such perfection and priority, or for or with respect to the sufficiency of the
Trust Property or its ability to generate the payments to be distributed to
Certificateholders under this Agreement or the Noteholders under the
Indenture, including, without limitation: the existence, condition and
ownership of any Financed Vehicle; the existence and enforceability of any
insurance thereon; the existence and contents of any Receivable on any
computer or other record thereof; the validity of the assignment of any
Receivable to the Trust or of any intervening assignment; the completeness of
any Receivable; the performance or enforcement of any Receivable; the
compliance by the Depositor or the Master Servicer with any warranty or
representation made under any Basic Document or in any related document or the
accuracy of any such warranty or representation, or any action of the
Indenture Trustee or the Master Servicer or any sub-Servicer taken in the name
of the Owner Trustee.
Section 7.07. Owner Trustee May Own Trust Certificates and Notes. The
Owner Trustee in its individual or any other capacity may become the owner or
pledgee of Trust Certificates or Notes and may deal with the Depositor, the
Indenture Trustee and the Master Servicer in banking transactions with the
same rights as it would have if it were not Owner Trustee.
Section 7.08. Doing Business in Other Jurisdictions. Notwithstanding
anything contained herein to the contrary, the Owner Trustee shall not be
required to take any action in any jurisdiction other than in the States of
Delaware, New York or Minnesota if the taking of such action will (i) require
the consent or approval or authorization or order of, or the giving of
25
notice to, or the registration with, or the taking of any other action in
required by, any state or other governmental authority or agency of any
jurisdiction other than the States of Delaware, New York or Minnesota; (ii)
result in any fee, tax or other governmental charge under the laws of any
jurisdiction or any political subdivisions thereof in existence on the date
hereof other than the States of Delaware, New York or Minnesota becoming
payable by the Owner Trustee; or (iii) subject to the Owner Trustee to
personal jurisdiction in any jurisdiction other than the States of Delaware,
New York or Minnesota for causes of action arising from acts unrelated to the
consummation of the transactions by the Owner Trustee, as the case may be,
contemplated hereby. The Owner Trustee shall be entitled to obtain advice of
counsel (which advice shall be an expense of the Trust under Section 8.01) to
determine whether any action required to be taken pursuant to the Agreement
results in the consequences described in clauses (i), (ii) and (iii) of the
preceding sentence. In the event that said counsel advises the Owner Trustee
that such action will result in such consequences, the Owner Trustee will
appoint an additional trustee pursuant to Section 10.05 to proceed with such
action.
Section 7.09. Paying Agent, Certificate Registrar and Authenticating
Agent. The rights and protections afforded to the Owner Trustee pursuant to
this Article VII and Sections 8.02, 10.02, and 10.03 shall also be afforded to
the Paying Agent, authenticating agent and Certificate Registrar.
ARTICLE VIII
COMPENSATION OF OWNER TRUSTEE
Section 8.01. Owner Trustee's Fees and Expenses. The Owner Trustee shall
receive from the Depositor or the Trust as compensation for its services
hereunder such fees as have been separately agreed upon before the date hereof
between the Depositor and the Owner Trustee, and the Owner Trustee shall be
reimbursed by the Depositor or the Trust for its other reasonable expenses
hereunder, including the reasonable compensation, expenses and disbursements
of such agents, representatives, experts and counsel as the Owner Trustee may
employ in connection with the exercise and performance of its rights and its
duties hereunder, in the priority set forth in Section 8.2 in the Indenture.
Section 8.02. Indemnification. The Trust and the Depositor shall jointly
and severally indemnify the Owner Trustee and its successors, assigns, agents
and servants (collectively, the "Indemnified Parties") from and against, any
and all liabilities, obligations, losses, damages, taxes, claims, actions and
suits, and any and all reasonable costs, expenses and disbursements (including
reasonable legal fees and expenses) of any kind and nature whatsoever
(collectively, "Expenses") which may at any time be imposed on, incurred by,
or asserted against the Owner Trustee or any Indemnified Party in any way
relating to or arising out of this Agreement, the Basic Documents, the Owner
Trust Estate, the administration of the Owner Trust Estate or the action or
inaction of the Owner Trustee hereunder, except only that the Trust shall not
be liable for or required to indemnify an Indemnified Party from or against
Expenses arising or resulting from (i) the willful misconduct or gross
negligence of the Owner Trustee or (ii) the inaccuracy of a representation or
warranty made by the Owner Trustee in Section 7.03. The indemnities contained
in this Section shall survive the resignation or removal of the Owner Trustee
or the termination of this Agreement. In the event of any claim, action or
proceeding for
26
which indemnity will be sought pursuant to this Section, the Indemnified
Party's choice of legal counsel shall be subject to the approval of the
Depositor, which approval shall not be unreasonably withheld.
Section 8.03. Payments to the Owner Trustee. Any amounts paid by the
Trust pursuant to this Article VIII shall be payable solely in the priority
set forth in Section 8.2 of the Indenture and shall be deemed not to be a part
of the Trust Estate immediately after such payment.
ARTICLE IX
TERMINATION OF TRUST AGREEMENT
Section 9.01. Termination of Trust Agreement.
(a) The Trust shall dissolve upon the earlier of (i) the payment in full
or other liquidation and discharge in accordance with the Sale and Servicing
Agreement of each Receivable and (ii) the sale by the Trust of all of the
Receivables in accordance with the Indenture and the Sale and Servicing
Agreement, including pursuant an exercise of the option to purchase under
Section 8.1 of the Sale and Servicing Agreement, and in each case upon the
final distribution of all moneys or other property or proceeds of the Trust
Estate in accordance with the terms of the Indenture, Article VIII of the Sale
and Servicing Agreement, Section 5.02 of this Agreement and the Statutory
Trust Statute. Any money or other property held as part of the Owner Trust
Estate following such distribution shall be distributed to the
Certificateholders pro rata. The bankruptcy, liquidation, dissolution, death
or incapacity of any Certificateholder shall not (i) operate to dissolve or
terminate this Agreement or the Trust, (ii) entitle such Certificateholder's
legal representatives or heirs to claim an accounting or to take any action or
proceeding in any court for a partition or winding up of all or any part of
the Trust or Trust Estate or (iii) otherwise affect the rights, obligations
and liabilities of the parties hereto.
(b) This Agreement and the Trust are irrevocable. Except as provided in
Section 9.01(a) and in this Section 9.01(b), neither the Depositor nor any
Certificateholder shall be entitled to revoke or terminate the Trust or this
Agreement.
(c) Notice of any dissolution of the Trust, specifying the Distribution
Date upon which Certificateholders shall surrender their Trust Certificates to
the Paying Agent for payment of the final distribution and cancellation, shall
be given by the Owner Trustee by letter to Certificateholders mailed within
five Business Days of receipt of notice of such termination from the Master
Servicer given pursuant to Section 8.1 of the Sale and Servicing Agreement,
stating (i) the Distribution Date upon or with respect to which final payment
of the Trust Certificates shall be made upon presentation and surrender of the
Trust Certificates at the office of the Paying Agent therein designated, (ii)
the amount of any such final payment and (iii) that the Record Date otherwise
applicable to such Distribution Date is not applicable, payments being made
only upon presentation and surrender of the Trust Certificates at the office
of the Paying Agent therein specified. The Owner Trustee shall give such
notice to the Certificate Registrar (if other than the Owner Trustee) and the
Paying Agent at the time such notice is given to Certificateholders. Upon
presentation and surrender of the Trust Certificates, the Paying Agent
27
shall cause to be distributed to Certificateholders amounts distributable on
such Distribution Date pursuant to Section 5.02.
In the event that all of the Certificateholders shall not surrender their
Trust Certificates for cancellation within six months after the date specified
in the above mentioned written notice, the Owner Trustee shall give a second
written notice to the remaining Certificateholders to surrender their Trust
Certificates for cancellation and receive the final distribution with respect
thereto. If within one year after the second notice all the Trust Certificates
shall not have been surrendered for cancellation, the Owner Trustee may take
appropriate steps, or may appoint an agent to take appropriate steps, to
contact the remaining Certificateholders concerning surrender of their Trust
Certificates, and the cost thereof shall be paid out of the funds and other
assets that shall remain subject to this Agreement. Any funds remaining in the
Trust after exhaustion of such remedies shall be distributed by the Owner
Trustee to the Depositor, subject to applicable escheat laws.
(d) Upon the winding up of the Trust in accordance with the Statutory
Trust Statute (including, without limitation, the reasonable provision for
payment of all obligations of the Trust in accordance with Section 3808(e) of
the Statutory Trust Statute), the Owner Trustee shall cause the Certificate of
Trust to be canceled by filing a certificate of cancellation with the
Secretary of State in accordance with the provisions of Section 3810 of the
Statutory Trust Statute and thereupon the Trust and this Agreement (other than
Article VIII) shall terminate.
ARTICLE X
SUCCESSOR OWNER TRUSTEES AND ADDITIONAL OWNER TRUSTEES
Section 10.01. Eligibility Requirements for Owner Trustee. The Owner
Trustee shall at all times be a corporation satisfying the provisions of
Section 3807(a) of the Statutory Trust Statute; authorized to exercise
corporate trust powers; having a combined capital and surplus of at least
$50,000,000 and subject to supervision or examination by federal or state
authorities; incorporated or chartered under the laws of the State of Delaware
or the federal laws of the United States; and having (or having a parent that
has) time deposits that are rated at least "Prime-1" by Moody's and at least
"A-1" by Standard & Poor's, or which is otherwise acceptable to each Rating
Agency. If such corporation shall publish reports of condition at least
annually pursuant to law or to the requirements of the aforesaid supervising
or examining authority, then for the purpose of this Section, the combined
capital and surplus of such corporation shall be deemed to be its combined
capital and surplus as set forth in its most recent report of condition so
published. In case at any time the Owner Trustee shall cease to be eligible in
accordance with the provisions of this Section, the Owner Trustee shall resign
immediately in the manner and with the effect specified in Section 10.02.
Section 10.02. Resignation or Removal of Owner Trustee. The Owner Trustee
may at any time resign and be discharged from the trusts hereby created by
giving written notice thereof to the Depositor, the Indenture Trustee and the
Rating Agencies. Upon receiving such notice of resignation, the Depositor
shall promptly appoint a successor Owner Trustee by written instrument, in
duplicate, one copy of which instrument shall be delivered to the resigning
Owner Trustee and one copy to the successor Owner Trustee. If no successor
Owner Trustee shall have
28
been so appointed and have accepted appointment within 30 days after the
giving of such notice of resignation, the resigning Owner Trustee may petition
any court of competent jurisdiction for the appointment of a successor Owner
Trustee, provided, however, that such right to appoint or to petition for the
appointment of any such successor shall in no event relieve the resigning
Owner Trustee from any obligations otherwise imposed on it under the Basic
Documents until such successor has in fact assumed such appointment.
If at any time the Owner Trustee shall cease to be eligible in accordance
with the provisions of Section 10.01 and shall fail to resign after written
request therefor by the Depositor, or if at any time the Owner Trustee shall
be legally unable to act, or shall be adjudged bankrupt or insolvent, or a
receiver of the Owner Trustee or of its property shall be appointed, or any
public officer shall take charge or control of the Owner Trustee or of its
property or affairs for the purpose of rehabilitation, conservation or
liquidation, then the Depositor may remove the Owner Trustee. If the Depositor
shall remove the Owner Trustee under the authority of the immediately
preceding sentence, the Depositor shall promptly appoint a successor Owner
Trustee by written instrument, in duplicate, one copy of which instrument
shall be delivered to the outgoing Owner Trustee so removed and one copy to
the successor Owner Trustee, and shall pay all fees owed to the outgoing Owner
Trustee.
Any resignation or removal of the Owner Trustee and appointment of a
successor Owner Trustee pursuant to any of the provisions of this Section
shall not become effective until acceptance of appointment by the successor
Owner Trustee pursuant to Section 10.03 and payment of all fees and expenses
owed to the outgoing Owner Trustee. The Depositor shall provide notice of such
resignation or removal of the Owner Trustee to each Rating Agency.
Section 10.03. Successor Owner Trustee. Any successor Owner Trustee
appointed pursuant to Section 10.01 or 10.02 shall execute, acknowledge and
deliver to the Depositor, the Indenture Trustee and to its predecessor Owner
Trustee an instrument accepting such appointment under this Agreement, and
thereupon the resignation or removal of the predecessor Owner Trustee shall
become effective, and such successor Owner Trustee, without any further act,
deed or conveyance, shall become fully vested with all the rights, powers,
duties and obligations of its predecessor under this Agreement, with like
effect as if originally named as Owner Trustee. The predecessor Owner Trustee
shall, upon payment of its fees and expenses, deliver to the successor Owner
Trustee all documents and statements and monies held by it under this
Agreement; and the Depositor and the predecessor Owner Trustee shall execute
and deliver such instruments and do such other things as may reasonably be
required for fully and certainly vesting and confirming in the successor Owner
Trustee all such rights, powers, duties and obligations.
No successor Owner Trustee shall accept appointment as provided in this
Section unless at the time of such acceptance such successor Owner Trustee
shall be eligible as a successor Owner Trustee pursuant to Section 10.01.
Upon acceptance of appointment by a successor Owner Trustee pursuant to
this Section, the Depositor shall mail notice thereof to all
Certificateholders, the Master Servicer, the Indenture Trustee, the
Noteholders and the Rating Agencies. If the Depositor shall fail to mail such
notice within ten days after acceptance of such appointment by the successor
Owner
29
Trustee, the successor Owner Trustee shall cause such notice to be mailed at
the expense of the Trust.
Any successor Owner Trustee appointed pursuant to this Section 10.03
shall promptly file an amendment to the Certificate of Trust with the
Secretary of State identifying the name and principal place of business of
such successor Owner Trustee in the State of Delaware.
Section 10.04. Merger or Consolidation of Owner Trustee. Any Person into
which the Owner Trustee may be merged or converted or with which it may be
consolidated, or any Person resulting from any merger, conversion or
consolidation to which the Owner Trustee shall be a party, or any Person
succeeding to all or substantially all of the corporate trust business of the
Owner Trustee, shall be the successor of the Owner Trustee hereunder, without
the execution or filing of any instrument or any further act on the part of
any of the parties hereto, anything herein to the contrary notwithstanding;
provided, that such Person shall be eligible pursuant to Section 10.01; and
provided further, that the Owner Trustee shall mail notice of such merger or
consolidation to each Rating Agency; and provided, further, that such
successor Owner Trustee shall file an amendment to the Certificate of Trust as
described in Section 10.03.
Section 10.05. Appointment of Co-Trustee or Separate Trustee.
Notwithstanding any other provisions of this Agreement, at any time, for the
purpose of meeting any legal requirements of any jurisdiction in which any
part of the Trust Estate or any Financed Vehicle may at the time be located,
the Owner Trustee shall have the power and shall execute and deliver all
instruments to appoint one or more Persons approved by the Owner Trustee to
act as co-trustee, jointly with the Owner Trustee, or as separate trustee or
separate trustees, of all or any part of the Trust Estate, and to vest in such
Person, in such capacity, such title to the Trust Estate or any part thereof
and, subject to the other provisions of this Section, such powers, duties,
obligations, rights and trusts as the Owner Trustee may consider necessary or
desirable. No co-trustee or separate trustee under this Agreement shall be
required to meet the terms of eligibility as a successor Owner Trustee
pursuant to Section 10.01 and no notice of the appointment of any co-trustee
or separate trustee shall be required pursuant to Section 10.03.
Each separate trustee and co-trustee shall, to the extent permitted by
law, be appointed and act subject to the following provisions and conditions:
(a) all rights, powers, duties and obligations conferred or imposed upon
the Owner Trustee shall be conferred upon and exercised or performed by the
Owner Trustee and such separate trustee or co-trustee jointly (it being
understood that such separate trustee or co-trustee is not authorized to act
separately without the Owner Trustee joining in such act), except to the
extent that under any law of any jurisdiction in which any particular act or
acts are to be performed, the Owner Trustee shall be incompetent or
unqualified to perform such act or acts, in which event such rights, powers,
duties and obligations (including the holding of title to the Trust Estate or
any portion thereof in any such jurisdiction) shall be exercised and performed
singly by such separate trustee or co-trustee, but solely at the direction of
the Owner Trustee;
(b) no trustee under this Agreement shall be personally liable by reason
of any act or omission of any other trustee under this Agreement; and
30
(c) the Owner Trustee may at any time accept the resignation of or remove
any separate trustee or co-trustee.
Any notice, request or other writing given to the Owner Trustee shall be
deemed to have been given to each of the then separate trustees and
co-trustees, as effectively as if given to each of them. Every instrument
appointing any separate trustee or co-trustee shall refer to this Agreement
and the conditions of this Article. Each separate trustee and co-trustee, upon
its acceptance of the trusts conferred, shall be vested with the estates or
property specified in its instrument of appointment, either jointly with the
Owner Trustee or separately, as may be provided therein, subject to all the
provisions of this Agreement, specifically including every provision of this
Agreement relating to the conduct of, affecting the liability of, or affording
protection to, the Owner Trustee. Each such instrument shall be filed with the
Owner Trustee.
Any separate trustee or co-trustee may at any time appoint the Owner
Trustee as its agent or attorney-in-fact with full power and authority, to the
extent not prohibited by law, to do any lawful act under or in respect of this
Agreement on its behalf and in its name. If any separate trustee or co-trustee
shall die, become incapable of acting, resign or be removed, all of its
estates, properties, rights, remedies and trusts shall vest in and be
exercised by the Owner Trustee, to the extent permitted by law, without the
appointment of a new or successor co-trustee or separate trustee.
ARTICLE XI
MISCELLANEOUS
Section 11.01. Supplements and Amendments. This Agreement may be amended
by the Depositor and the Owner Trustee, with prior written notice to each
Rating Agency, without the consent of any of the Noteholders or the
Certificateholders, to cure any ambiguity, to correct or supplement any
provisions in this Agreement or for the purpose of adding any provisions to or
changing in any manner or eliminating any of the provisions in this Agreement
or of modifying in any manner the rights of the Noteholders or the
Certificateholders; provided, however, that such action shall not, as
evidenced by the satisfaction of the Rating Agency Condition with respect to
such amendment, adversely affect in any material respect the interests of any
Noteholder or Certificateholder.
This Agreement may also be amended from time to time by the Depositor and
the Owner Trustee, with prior written notice to each Rating Agency, with the
consent of the Holders of Notes evidencing not less than a majority of the
Outstanding Amount of the Notes and the consent of the Holders of Certificates
evidencing not less than a majority of the Certificate Percentage Interests,
for the purpose of adding any provisions to or changing in any manner or
eliminating any of the provisions of this Agreement or of modifying in any
manner the rights of the Noteholders or the Certificateholders; provided,
however, that no such amendment shall (a) increase or reduce in any manner the
amount of, or accelerate or delay the timing of, collections of payments on
Receivables or distributions that shall be required to be made for the benefit
of the Noteholders or the Certificateholders or (b) reduce the aforesaid
percentage of the Outstanding Amount of the Notes and the aforesaid
Certificate Percentage Interests required to
31
consent to any such amendment, without the consent of the Holders of all
then-outstanding Notes and the Certificateholders of all then-outstanding
Certificates.
Promptly after the execution of any such amendment or consent, the Owner
Trustee shall furnish written notification of the substance of such amendment
or consent to each Certificateholder, the Indenture Trustee and each Rating
Agency.
It shall not be necessary for the consent of Certificateholders or
Noteholders pursuant to this Section to approve the particular form of any
proposed amendment or consent, but it shall be sufficient if such consent
shall approve the substance thereof. The manner of obtaining such consents
(and any other consents of Certificateholders provided for in this Agreement
or in any other Basic Document) and of evidencing the authorization of the
execution thereof by Certificateholders or Noteholders shall be subject to
such reasonable requirements as the Owner Trustee may prescribe.
Promptly after the execution of any amendment to the Certificate of
Trust, the Owner Trustee shall cause the filing of such amendment with the
Secretary of State.
Prior to the execution of any amendment to this Agreement, any other
Basic Document or the Certificate of Trust, the Owner Trustee shall be
entitled to receive and rely upon an Opinion of Counsel stating that the
execution of such amendment is authorized or permitted by this Agreement and
that all conditions precedent (if any) to such amendment specified in this
Agreement and the other Basic Documents have been met. The Owner Trustee may,
but shall not be obligated to, enter into any such amendment that affects the
Owner Trustee's own rights, duties or immunities under this Agreement or
otherwise.
Section 11.02. No Legal Title to Trust Estate in Certificateholders.
Neither the Depositor nor the Certificateholders shall have legal title to any
part of the Trust Estate. The Certificateholders shall be entitled to receive
distributions with respect to their undivided ownership interest therein only
in accordance with Articles V and IX. No transfer, by operation of law or
otherwise, of any right, title or interest of the Certificateholders to and in
their undivided ownership interest in the Owner Trust Estate shall operate to
terminate this Agreement or the trusts hereunder or entitle any transferee to
an accounting or to the transfer to it of legal title to any part of the Owner
Trust Estate.
Section 11.03. Limitations on Rights of Others. The provisions of this
Agreement are solely for the benefit of the Owner Trustee, the Depositor, the
Certificateholders, the Paying Agent, the Certificate Registrar and, to the
extent expressly provided herein, the Indenture Trustee and the Noteholders,
and nothing in this Agreement, whether express or implied, shall be construed
to give to any other Person any legal or equitable right, remedy or claim in
the Owner Trust Estate or under or in respect of this Agreement or any
covenants, conditions or provisions contained herein.
Section 11.04. Notices.
(a) Unless otherwise expressly specified or permitted by the terms
hereof, all notices shall be in writing and shall be deemed given upon receipt
by the intended recipient or three Business Days after mailing if mailed by
first-class mail, postage prepaid (except that
32
notice to the Owner Trustee shall be deemed given only upon actual receipt by
the Owner Trustee), if to the Owner Trustee, addressed to the Corporate Trust
Office; if to the Depositor, addressed to ML Asset Backed Corporation, 4 World
Financial Center, 00xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000-0000, facsimile (212)
449-9015, Attention: Xxx Xxxxx; if to Issuer, addressed to Merrill Auto Trust
Securitization 2005-1 c/o ML Asset Backed Corporation, 4 World Financial
Center, 00xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000-0000, facsimile (000) 000-0000,
Attention: Xxx Xxxxx; or, as to each party, at such other address as shall be
designated by such party in a written notice to each other party. A copy of
any such notice shall also be mailed to the Master Servicer, addressed to U.S.
Bank Corporate Trust Services, 00 Xxxxxxxxxx Xxxxxx, Mailcode: XX-XX-XX00, Xx.
Xxxx, Xxxxxxxxx 00000-0000, facsimile (000) 000-0000, Attention: Xxx Xxxxxx.
(b) Any notice required or permitted to be given to a Certificateholder
shall be given by first-class mail, postage prepaid, at the address of such
Certificateholder as shown in the Certificate Register. Any notice so mailed
within the time prescribed in this Agreement shall be conclusively presumed to
have been duly given, whether or not such Certificateholder receives such
notice.
Section 11.05. Severability. Any provision of this Agreement or the Trust
Certificates that is prohibited or unenforceable in any jurisdiction shall, as
to such jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof or of
the Trust Certificates, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in
any other jurisdiction.
Section 11.06. Separate Counterparts. This Agreement may be executed by
the parties hereto in separate counterparts, each of which when so executed
and delivered shall be an original, but all such counterparts shall together
constitute but one and the same instrument.
Section 11.07. Successors and Assigns. All covenants and agreements
contained herein shall be binding upon, and inure to the benefit of, each of
the Depositor and its permitted assignees, the Owner Trustee and its
successors and each Certificateholder and its successors and permitted
assigns, all as herein provided. Any request, notice, direction, consent,
waiver or other instrument or action by a Certificateholder shall bind the
successors and assigns of such Certificateholder.
Section 11.08. Covenants of the Depositor. The Depositor will not at any
time institute against the Trust any bankruptcy proceedings under any United
States federal or state bankruptcy or similar law in connection with any
obligations relating to the Trust Certificates, the Notes, this Agreement or
any of the other Basic Documents.
Section 11.09. No Petition. The Owner Trustee, by entering into this
Agreement, each Certificateholder, by accepting a Trust Certificate, and the
Indenture Trustee and each Noteholder, by accepting the benefits of this
Agreement, hereby covenant and agree that they will not at any time institute
against the Depositor or the Trust or join in any institution against the
Depositor or the Trust of, any bankruptcy proceedings under any United States
federal or
33
state bankruptcy or similar law in connection with any obligations relating to
the Trust Certificates, the Notes, this Agreement or any of the other Basic
Documents.
Section 11.10. No Recourse. Each Certificateholder by accepting a Trust
Certificate acknowledges that such Trust Certificate represents a beneficial
interest in the Trust only and does not represent an interest in or an
obligation of the Depositor, the Master Servicer, the Owner Trustee, the
Indenture Trustee or any Affiliate thereof and no recourse may be had against
such parties or their assets, except as may be expressly set forth or
contemplated in this Agreement, the Trust Certificates or the Basic Documents.
Section 11.11. Headings. The headings of the various Articles and
Sections herein are for convenience of reference only and shall not define or
limit any of the terms or provisions hereof.
Section 11.12. GOVERNING LAW. THIS AGREEMENT SHALL BE CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF DELAWARE, WITHOUT REFERENCE TO ITS
CONFLICT OF LAW PROVISIONS, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE
PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
Section 11.13. Xxxxxxxx-Xxxxx. Notwithstanding anything contained herein
or in any other Basic Document to the contrary, the Owner Trustee shall not be
required to execute, deliver or certify on behalf of the Trust or any other
Person any filings, certificates, affidavits or other instruments (including,
without limitation, any Xxxxxxxx-Xxxxx Certification) required under the
Xxxxxxxx-Xxxxx Act of 2002.
Section 11.14. Acceptance of Terms of Agreement. The receipt and
acceptance of a Trust Certificate by a Certificateholder, without any
signature or further manifestation of assent, shall constitute the
unconditional acceptance by the Certificateholder of all the terms and
provisions of this Agreement, and shall constitute the agreement of the
Certificateholder that the terms and provisions of this Agreement shall be
binding, operative and effective as between the Owner Trustee and the
Certificateholder.
34
IN WITNESS WHEREOF, the parties hereto have caused this Trust Agreement
to be duly executed by their respective officers hereunto duly authorized, as
of the day and year first above written.
ML ASSET BACKED CORPORATION,
as Depositor
By: /s/ Xxxxxxxx X. Xxxxx
------------------------------------------
Name: Xxxxxxxx X. Xxxxx
Title: Managing Director
U.S. BANK TRUST NATIONAL
ASSOCIATION, as Owner
Trustee
By: /s/ Xxx X. Xxxxxx
------------------------------------------
Name: Xxx X. Xxxxxx
Title: Vice President
35
EXHIBIT A
---------
FORM OF TRUST CERTIFICATE
-------------------------
THIS TRUST CERTIFICATE IS SUBORDINATE TO THE NOTES, AS SET FORTH IN THE
SALE AND SERVICING AGREEMENT.
THIS TRUST CERTIFICATE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR ANY STATE
SECURITIES LAWS, AND MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE
TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN EXEMPTION THEREFROM. IN
ADDITION, THE TRANSFER OF THIS TRUST CERTIFICATE IS SUBJECT TO CERTAIN
RESTRICTIONS AND CONDITIONS SET FORTH IN SECTION 3.04 OF THE TRUST AGREEMENT
UNDER WHICH THIS TRUST CERTIFICATE IS ISSUED (A COPY OF WHICH TRUST AGREEMENT
IS AVAILABLE FROM THE OWNER TRUSTEE OR UPON REQUEST), INCLUDING RECEIPT BY THE
OWNER TRUSTEE OF AN INVESTMENT LETTER IN WHICH THE TRANSFEREE MAKES CERTAIN
REPRESENTATIONS.
THE HOLDER OF THIS TRUST CERTIFICATE ACKNOWLEDGES AND AGREES THAT ITS
RIGHTS TO RECEIVE DISTRIBUTIONS ARE SUBORDINATED TO THE RIGHTS OF THE
NOTEHOLDERS AS DESCRIBED IN THE SALE AND SERVICING AGREEMENT, THE INDENTURE
AND THE TRUST AGREEMENT REFERRED TO HEREIN.
THIS TRUST CERTIFICATE IS NOT GUARANTEED OR INSURED BY THE FEDERAL
DEPOSIT INSURANCE CORPORATION OR ANY GOVERNMENTAL AGENCY.
A-1
NUMBER R-___ PERCENTAGE INTEREST: [ ]%
MERRILL AUTO TRUST SECURITIZATION 2005-1 CERTIFICATE evidencing a
fractional undivided beneficial interest in the Trust, as defined below. The
property of the Trust includes a pool of motor vehicle installment sale
contracts and loans, secured by security interests in new and used
automobiles, light duty trucks, sports utility vehicles and motorcycles,
conveyed by ML Asset Backed Corporation.
THIS TRUST CERTIFICATE DOES NOT REPRESENT AN INTEREST IN OR AN OBLIGATION
OF XXXXXXX XXXXX BANK USA, ML ASSET BACKED CORPORATION OR ANY OF THEIR
RESPECTIVE AFFILIATES.
THIS CERTIFIES THAT ________________ is the registered owner of a ____%
PERCENT nonassessable, fully paid, undivided beneficial interest in MERRILL
AUTO TRUST SECURITIZATION 2005-1, a Delaware statutory trust (the "Trust"),
formed by ML ASSET BACKED CORPORATION, a Delaware corporation (the
"Depositor").
The Trust was created pursuant to a Trust Agreement amended and restated
as of May 31, 2005 (as amended, supplemented or otherwise modified from time
to time, the "Trust Agreement"), between the Depositor and U.S. Bank Trust
National Association, as owner trustee (the "Owner Trustee"), a summary of
certain of the pertinent provisions of which is set forth below. To the extent
not otherwise defined herein, the capitalized terms used herein have the
meanings assigned to them in the Trust Agreement or the Sale and Servicing
Agreement dated as of May 31, 2005 (as amended, supplemented or otherwise
modified from time to time, the "Sale and Servicing Agreement"), among the
Trust, the Depositor and Xxxxxxx Xxxxx Bank USA, as Seller, U.S. Bank National
Association, as Master Servicer.
This Trust Certificate is one of the duly authorized Trust Certificates
designated as "Asset Backed Certificates" (herein called the "Trust
Certificates"). Also issued under an Indenture dated as of May 31, 2005 (as
amended, supplemented or otherwise modified from time to time, the
"Indenture"), among the Trust, HSBC Bank USA, National Association, as
indenture trustee (the "Indenture Trustee") and U.S. Bank National
Association, as securities administrator (the "Securities Administrator"), are
the classes of Notes designated as "3.472% Asset Backed Notes, Class A-1,"
"3.900% Asset Backed Notes, Class A-2a," "Floating Rate Asset Baked Notes,
Class A-2b," "4.100% Asset Backed Notes, Class A-3," "Floating Rate Asset
Backed Notes, Class A-4" (collectively, the "Class A Notes"), "Floating Rate
Asset Backed Notes, Class B" (the "Class B Notes") and "Floating Rate Asset
Backed Notes, Class C" (the "Class C Notes," and together with the Class A
Notes and the Class B Notes, the "Notes"). This Trust Certificate is issued
under and is subject to the terms, provisions and conditions of the Trust
Agreement, to which Trust Agreement the Holder of this Trust Certificate by
virtue of its acceptance hereof assents and by which such Certificateholder is
bound. The property of the Trust consists of the Conveyed Trust Estate. The
rights of the Certificateholders are subordinate to the rights of the
Noteholders, as set forth in the Indenture.
Under the Trust Agreement, there will be distributed on the 25th day of
each month or, if such 25th day is not a Business Day, the next Business Day
(each, a "Distribution Date"), commencing on July 25, 2005, to the Person in
whose name this Trust Certificate is
A-2
registered on the last day of the immediately preceding month (the "Record
Date"), such Certificateholder's fractional undivided interest in the amount
to be distributed to Certificateholders on such Distribution Date.
The Holder of this Trust Certificate acknowledges and agrees that its
rights to receive distributions in respect of this Trust Certificate are
subordinate to the rights of the Noteholders as described in the Sale and
Servicing Agreement and the Indenture.
It is the intent of the Depositor and the Certificateholders that, solely
for income and franchise tax purposes: the Trust shall be treated as a grantor
trust (or to the extent required, as a partnership) for income and franchise
tax purposes. A Certificateholder, by its acceptance of a Trust Certificate,
agrees to treat, and to take no action inconsistent with such treatment of the
Trust.
A Certificateholder, by its acceptance of a Trust Certificate, covenants
and agrees that such Certificateholder will not at any time institute against
the Depositor, the Owner Trustee or the Trust, or join in any institution
against the Depositor, the Owner Trustee or the Trust of, any bankruptcy,
reorganization, arrangement, insolvency or liquidation proceedings, or other
proceedings under any United States federal or state bankruptcy or similar law
in connection with any obligations relating to the Trust Certificates, the
Notes, the Trust Agreement or any of the other Basic Documents.
Distributions on this Trust Certificate will be made as provided in the
Trust Agreement by the Owner Trustee or the Paying Agent by wire transfer or
check mailed to the Certificateholder of record in the Certificate Register
without the presentation or surrender of this Trust Certificate or the making
of any notation hereon.
Except as otherwise provided in the Trust Agreement and notwithstanding
the above, the final distribution on this Trust Certificate will be made after
due notice by the Owner Trustee of the pendency of such distribution and only
upon presentation and surrender of this Trust Certificate at the office or
agency designated for that purpose by the Owner Trustee as set forth in the
Trust Agreement.
Reference is hereby made to the further provisions of this Trust
Certificate set forth on the reverse hereof, which further provisions shall
for all purposes have the same effect as if set forth at this place.
Unless the certificate of authentication hereon shall have been executed
by an authorized officer of the Owner Trustee or the authenticating agent, by
manual signature, this Trust Certificate shall not entitle the Holder hereof
to any benefit under the Trust Agreement or the Sale and Servicing Agreement
or be valid for any purpose.
THIS TRUST CERTIFICATE SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF
THE STATE OF DELAWARE, WITHOUT REFERENCE TO ITS CONFLICT OF LAW PROVISIONS,
AND THE OBLIGATIONS, RIGHTS AND REMEDIES
A-3
OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
IN WITNESS WHEREOF, the Owner Trustee has caused this Trust Certificate
to be duly executed.
U.S. BANK TRUST NATIONAL
ASSOCIATION, not in its
individual capacity but
solely as Owner Trustee
Dated: June 23, 2005 By:
--------------------------------------
Authorized Signatory
A-4
OWNER TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Trust Certificates referred to in the within-mentioned
Trust Agreement.
U.S. BANK TRUST NATIONAL U.S. BANK TRUST NATIONAL
ASSOCIATION, as Owner Trustee ASSOCIATION, as Owner Trustee
By:
----------------------------
as Authenticating Agent
By: By:
------------------------------ ----------------------------
Authorizing Agent Authorizing Agent
A-5
[REVERSE OF TRUST CERTIFICATE]
The Trust Certificates do not represent an obligation of, or an interest
in, the Depositor, the Master Servicer, the Owner Trustee in its individual
capacity or any affiliates of any of them and no recourse may be had against
such parties or their assets, except as expressly set forth or contemplated
herein or in the Trust Agreement or the other Basic Documents. In addition,
this Trust Certificate is not guaranteed by any governmental agency or
instrumentality and is limited in right of payment to certain collections and
recoveries with respect to the Receivables (and certain other amounts), all as
more specifically set forth in the Trust Agreement and in the Sale and
Servicing Agreement. A copy of each of the Sale and Servicing Agreement and
the Trust Agreement may be examined by any Certificateholder upon written
request during normal business hours at the principal office of the Depositor
and at such other places, if any, designated by the Depositor.
The Trust Agreement permits, with certain exceptions provided therein,
the amendment thereof and the modification of the rights and obligations of
the Depositor and the rights of the Certificateholders under the Trust
Agreement at any time by the Depositor and the Owner Trustee, with prior
written notice to each Rating Agency, with the consent of the Holders of Notes
evidencing not less than a majority of the Outstanding Amount of the Notes and
the consent of the Certificateholders evidencing not less than a majority of
the Certificate Percentage Interests in the Trust Certificates, for the
purpose of adding any provisions to or changing in any manner or eliminating
any of the provisions of the Trust Agreement or of modifying in any manner the
rights of the Noteholders or the Certificateholders. Any such consent by the
Holder of this Trust Certificate shall be conclusive and binding on such
Holder and on all future Holders of this Trust Certificate and of any Trust
Certificate issued upon the transfer hereof or in exchange herefor or in lieu
hereof, whether or not notation of such consent is made upon this Trust
Certificate. The Trust Agreement also permits the amendment thereof, in
certain limited circumstances, without the consent of the Holders of any of
the Trust Certificates.
As provided in the Trust Agreement and subject to certain limitations
therein set forth, the transfer of this Trust Certificate is registerable in
the Certificate Register upon surrender of this Trust Certificate for
registration of transfer at the offices or agencies of the Certificate
Registrar designated by the Owner Trustee as set forth in the Trust Agreement,
accompanied by a written instrument of transfer in form satisfactory to the
Owner Trustee and the Certificate Registrar duly executed by the Holder hereof
or such Holder's attorney duly authorized in writing, and thereupon one or
more new Trust Certificates of authorized denominations evidencing the same
aggregate interest in the Trust will be issued to the designated transferee.
The initial Certificate Registrar appointed under the Trust Agreement is the
Owner Trustee.
Except as provided in the Trust Agreement, the Trust Certificates are
issuable only as registered Trust Certificates without coupons in minimum
denominations of one percent Certificate Percentage Interest. As provided in
the Trust Agreement and subject to certain limitations therein set forth,
Trust Certificates are exchangeable for new Trust Certificates of authorized
denominations evidencing the same aggregate denomination, as requested by the
Certificateholder surrendering the same. No service charge will be made for
any such registration of transfer or exchange, but the Owner Trustee or the
Certificate Registrar may
A-6
require payment of a sum sufficient to cover any tax or governmental charge
payable in connection therewith.
The Owner Trustee, the Certificate Registrar and any agent of the Owner
Trustee or the Certificate Registrar may treat the Person in whose name this
Trust Certificate is registered as the owner hereof for all purposes, and none
of the Owner Trustee, the Certificate Registrar or any such agent shall be
affected by any notice to the contrary.
The obligations and responsibilities created by the Trust Agreement and
the Trust created thereby shall terminate upon the payment to
Certificateholders of all amounts required to be paid to them pursuant to the
Trust Agreement and the Sale and Servicing Agreement and the disposition of
all property held as part of the Trust Estate. The Master Servicer under
certain circumstances and with the consent of the Certificateholders, may at
its option purchase the Trust Estate at a price specified in the Sale and
Servicing Agreement, and such purchase of the Receivables and other property
of the Trust will effect early retirement of the Trust Certificates; provided,
however, that such right of purchase is exercisable only as of the
Determination Date as of which the aggregate Principal Balance is of the
Receivables less than or equal to 10% of the Original Pool Balance.
The Trust Certificates may not be acquired by (a) an employee benefit
plan (as defined in Section 3(3) of ERISA) that is subject to the provisions
of Title I of ERISA or Similar Law, (b) a plan described in Section 4975(e)(1)
of the Code that is subject to Section 4975 of the Code or Similar Law, (c)
any entity whose underlying assets include plan assets by reason of a plan's
investment in the entity (each, a "Benefit Plan") or (d) a Person investing
"plan assets" of an entity of any Person described in clauses (a) through (c).
By accepting and holding this Trust Certificate, the Holder hereof shall be
deemed to have represented and warranted that it is not a Benefit Plan.
A-7
ASSIGNMENT
FOR VALUE RECEIVED the undersigned hereby sells, assigns and transfers
unto
PLEASE INSERT SOCIAL SECURITY OR
OTHER IDENTIFYING NUMBER OF ASSIGNEE
-------------------------------------------------------------------------------
(Please print or type name and address, including postal zip code, of assignee)
the within Trust Certificate, and all rights thereunder, and hereby
irrevocably constitutes and appoints ____________, attorney, to transfer said
Trust Certificate on the books of the Certificate Registrar, with full power
of substitution in the premises.
Dated: */
--------------------------------------------
Signature Guaranteed:
*/
--------------------------------------------
-------------------
*/ NOTICE: The signature to this assignment must correspond with the
name of the registered owner as it appears on the face of the within
Trust Certificate in every particular, without alteration,
enlargement or any change whatever. Such signature must be guaranteed
by an "eligible guarantor institution" meeting the requirements of
the Certificate Registrar, which requirements include membership or
participation in STAMP or such other "signature guarantee program" as
may be determined by the Certificate Registrar in addition to, or in
substitution for, STAMP, all in accordance with the Securities
Exchange Act of 1934, as amended.
A-8
EXHIBIT B
FORM OF TRANSFEROR CERTIFICATE
[DATE]
U.S. Bank Trust National Association,
as Owner Trustee
000 Xxxxxxxx Xxxxxx
Xxxxxxxxxx, Xxxxxxxx 00000
Attention: Corporate Trust Services
HSBC Bank USA, National Association
as Indenture Trustee
00 Xxxx 00xx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Merrill Auto Trust Securitization 2005-1
c/o ML Asset Backed Corporation
Four World Financial Center
Xxxxx Xxxxx - 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxx Xxxxx
Re: Merrill Auto Trust Securitization 2005-1
Ladies and Gentlemen:
In connection with our disposition of the Asset Backed Certificates (the
"Trust Certificates") issued by the referenced trust (the "Trust") we certify
that (a) we understand that the Trust Certificates have not been registered
under the Securities Act of 1933, as amended (the "Securities Act"), and are
being transferred by us in a transaction that is exempt from the registration
requirements of the Securities Act and (b) we have not offered or sold any
Trust Certificates to, or solicited offers to buy any Trust Certificates from,
any person, or otherwise approached or negotiated with any person with respect
thereto, in a manner that would be deemed, or taken any other action which
would result in, a violation of Section 5 of the Securities Act.
Very truly yours,
[NAME OF TRANSFEROR]
By:
-------------------------------------
Authorized Officer
B-1
EXHIBIT C
FORM OF INVESTMENT LETTER
[DATE]
U.S. Bank Trust National Association,
as Owner Trustee
EP-MN-WS3D
00 Xxxxxxxxxx Xxxxxx
Xx. Xxxx, Xxxxxxxxx 00000-0000
Attention: Corporate Trust Services
HSBC Bank USA, National Association
as Indenture Trustee
00 Xxxx 00xx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Merrill Auto Trust Securitization 2005-1
c/o ML Asset Backed Corporation
Four World Financial Center
Xxxxx Xxxxx - 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxx Xxxxx
Re: Merrill Auto Trust Securitization 2005-1, Trust Certificates
Ladies and Gentlemen:
In connection with our acquisition of the above-referenced Trust
Certificates (the "Certificates") we certify that (a) we understand that the
Certificates are not being registered under the Securities Act of 1933, as
amended (the "Act"), or any state securities laws and are being transferred to
us in a transaction that is exempt from the registration requirements of the
Act and any such laws, (b) we are an institutional "accredited investor," as
defined in Rule 501(a)(1), (2), (3) or (7) in Regulation D under the Act or
an entity in which all of the equity owners are institutional "accredited
investors," as defined in Rule 501(a)(1), (2), (3) or (7) in Regulation D
under the Act, and have such knowledge and experience in financial and
business matters that we are capable of evaluating the merits and risks of
investments in the Certificates, (c) we have had the opportunity to ask
questions of and receive answers from the seller concerning the purchase of
the Certificates and all matters relating thereto or any additional information
deemed necessary to our decision to purchase the Certificates, (d) we are
acquiring the Certificates for investment for our own account and not with a
view to any distribution of such Certificates (but without prejudice to our
right at all times to sell or otherwise dispose of the Certificates in
accordance with clause (f) below), (e) we have not offered or sold any
Certificates to, or solicited offers to buy any Certificates from, any person,
or otherwise approached or negotiated with any person with respect thereto, or
taken any other action that would result in a violation of Section 5 of the
Act or any state securities laws and (f) we will not sell, transfer or
C-1
otherwise dispose of any Certificates unless (1) such sale, transfer or other
disposition is made pursuant to an effective registration statement under the
Act and in compliance with any relevant state securities laws or is exempt
from such registration requirements and (2) the purchaser or transferee of
such Certificate has executed and delivered to you a certificate to
substantially the same effect as this certificate and (3) the purchaser or
transferee has otherwise complied with any conditions for transfer set forth
in the Amended and Restated Trust Agreement dated as of May 31, 2005, between
ML Asset Backed Corporation and U.S. Bank Trust National Association, as Owner
Trustee.
Very truly yours,
[NAME OF TRANSFEREE]
By:
------------------------------
Authorized Officer
C-2
EXHIBIT D
FORM OF RULE 144A LETTER
[DATE]
U.S. Bank Trust National Association,
as Owner Trustee
EP-MN-WS3D
00 Xxxxxxxxxx Xxxxxx
Xx. Xxxx, Xxxxxxxxx 00000-0000
Attention: Corporate Trust Services
HSBC Bank USA, National Association
as Indenture Trustee
00 Xxxx 00xx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Merrill Auto Trust Securitization 2005-1
c/o ML Asset Backed Corporation
Four World Financial Center
Xxxxx Xxxxx - 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxx Xxxxx
Re: Merrill Auto Trust Securitization 2005-1, Trust Certificates
Ladies and Gentlemen:
In connection with our acquisition of the above-referenced Trust
Certificates (the "Certificates") we certify that (a) we understand that the
Certificates are not being registered under the Securities Act of 1933, as
amended (the "Act"), or any state securities laws and are being transferred to
us in a transaction that is exempt from the registration requirements of the
Act and any such laws, (b) we have such knowledge and experience in financial
and business matters that we are capable of evaluating the merits and risks of
investments in the Certificates, (c) we have had the opportunity to ask
questions of and receive answers from the seller concerning the purchase of
the Certificates and all matters relating thereto or any additional
information deemed necessary to our decision to purchase the Certificates, (d)
we have not, nor has anyone acting on our behalf, offered, transferred,
pledged, sold or otherwise disposed of the Certificates or any interest in the
Certificates, or solicited any offer to buy, transfer, pledge or otherwise
dispose of the Certificates or any interest in the Certificates from any
person in any manner, or made any general solicitation by means of general
advertising or in any other manner, or taken any other action that would
constitute a distribution of the Certificates under the Act or that would
render the disposition of the Certificates a violation of Section 5 of the Act
or any state securities laws or require registration pursuant thereto, and we
will not act, or authorize any person to act, in such manner with respect to
the Certificates, and (e) we are a "qualified institutional buyer" as that
term is defined in Rule 144A under the Act. We are aware that the
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sale to us is being made in reliance on Rule 144A. We are acquiring the
Certificates for our own account or for resale pursuant to Rule 144A and
understand that such Certificates may be resold, pledged or transferred only
to a person reasonably believed to be a qualified institutional buyer that
purchases for its own account or for the account of a qualified institutional
buyer to whom notice is given that the resale, pledge or transfer is being
made in reliance on Rule 144A.
Very truly yours,
[NAME OF TRANSFEREE]
By:
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Authorized Officer
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