1
EXHIBIT 4.2
================================================================================
AMENDED AND RESTATED
TRUST AGREEMENT
among
FORD CREDIT AUTO RECEIVABLES TWO L.P.
as Depositor,
THE BANK OF NEW YORK (DELAWARE),
as Delaware Trustee
and
THE BANK OF NEW YORK,
as Owner Trustee
Dated as of September 1, 1999
================================================================================
2
TABLE OF CONTENTS
Page
ARTICLE I DEFINITIONS AND USAGE
ARTICLE II ORGANIZATION OF THE TRUST
SECTION 2.1. Name..................................................................... 2
SECTION 2.2. Offices.................................................................. 2
SECTION 2.3. Purposes and Powers...................................................... 2
SECTION 2.4. Appointment of Owner Trustee............................................. 3
SECTION 2.5. Appointment of Delaware Trustee.......................................... 3
SECTION 2.6. Capital Contribution of Owner
Trust Estate............................................................. 4
SECTION 2.7. Declaration of Trust..................................................... 4
SECTION 2.8. Liability of the Depositor............................................... 5
SECTION 2.9. Title to Trust Property.................................................. 6
SECTION 2.10. Situs of Trust........................................................... 6
SECTION 2.11. Representations and Warranties
of the Depositor......................................................... 6
SECTION 2.12. Federal Income Tax Matters............................................... 8
ARTICLE III TRUST CERTIFICATES AND TRANSFER OF INTERESTS
SECTION 3.1. Initial Beneficial Ownership............................................. 10
SECTION 3.2. Capital Accounts......................................................... 10
SECTION 3.3. The Certificates......................................................... 11
SECTION 3.4. Authentication of Certificates........................................... 11
SECTION 3.5. Registration of Certificates;
Transfer and Exchange of Certificates.................................... 12
SECTION 3.6. Mutilated, Destroyed, Lost or
Stolen Certificates...................................................... 19
SECTION 3.7. Persons Deemed Owners of
Certificates............................................................. 20
SECTION 3.8. Access to List of Certificateholders' Names and Addresses................ 20
SECTION 3.9. Maintenance of Office or Agency.......................................... 21
SECTION 3.10. Appointment of Certificate
Paying Agent............................................................. 21
SECTION 3.11. Certain Rights of Depositor.............................................. 22
ARTICLE IV ACTIONS BY OWNER TRUSTEE
SECTION 4.1. Prior Notice to Certificateholders with Respect
to Certain Matters....................................................... 23
SECTION 4.2. Action by Certificateholders
with Respect to Certain Matters.......................................... 24
SECTION 4.3. Action by Certificateholders
with Respect to Bankruptcy............................................... 24
i
3
SECTION 4.4. Restrictions on Certificateholders'
Power.................................................................... 25
SECTION 4.5. Majority Control......................................................... 25
ARTICLE V APPLICATION OF TRUST FUNDS; CERTAIN DUTIES
SECTION 5.1. Establishment of Certificate
Distribution Account..................................................... 25
SECTION 5.2. Application of Trust Funds............................................... 26
SECTION 5.3. Method of Payment........................................................ 28
SECTION 5.4. No Segregation of Monies; No Interest.................................... 29
SECTION 5.5. Accounting and Reports to Noteholders, Certificateholders,
Internal Revenue Service and Others...................................... 29
SECTION 5.6. Signature on Returns; Tax
Matters Partner.......................................................... 30
ARTICLE VI AUTHORITY AND DUTIES OF OWNER TRUSTEE
SECTION 6.1. General Authority........................................................ 30
SECTION 6.2. General Duties........................................................... 31
SECTION 6.3. Action upon Instruction.................................................. 31
SECTION 6.4. No Duties Except as Specified in this Agreement or in
Instructions............................................................. 32
SECTION 6.5. No Action Except Under Specified
Documents or Instructions................................................ 33
SECTION 6.6. Restrictions............................................................. 33
ARTICLE VII REGARDING THE OWNER TRUSTEE
SECTION 7.1. Acceptance of Trusts and Duties.......................................... 34
SECTION 7.2. Furnishing of Documents.................................................. 36
SECTION 7.3. Representations and Warranties........................................... 36
SECTION 7.4. Reliance; Advice of Counsel.............................................. 37
SECTION 7.5. Not Acting in Individual
Capacity................................................................. 38
SECTION 7.6. Owner Trustee Not Liable for
Certificates or Receivables.............................................. 38
SECTION 7.7. Co-Trustees May Own Certificates
and Notes................................................................ 39
ARTICLE VIII COMPENSATION AND INDEMNITY OF OWNER TRUSTEE
SECTION 8.1. Owner Trustee's Fees and Expenses........................................ 39
SECTION 8.2. Indemnification.......................................................... 40
SECTION 8.3. Payments to Co-Trustees.................................................. 40
ii
4
ARTICLE IX TERMINATION
SECTION 9.1. Termination of Trust Agreement........................................... 41
SECTION 9.2. Dissolution upon Insolvency or
Dissolution of Depositor or
General Partner.......................................................... 43
SECTION 9.3. Prepayment of Certificates............................................... 44
ARTICLE X SUCCESSOR OWNER TRUSTEES AND
ADDITIONAL OWNER TRUSTEES
SECTION 10.1. Eligibility Requirements for
Owner Trustee............................................................ 46
SECTION 10.2. Resignation or Removal of Owner
Trustee or the Delaware Trustee.......................................... 46
SECTION 10.3. Successor Owner Trustee or
Delaware Trustee......................................................... 48
SECTION 10.4. Merger or Consolidation of Owner
Trustee or Delaware Trustee.............................................. 49
SECTION 10.5. Appointment of Co-Trustee or
Separate Trustee......................................................... 49
SECTION 10.6. Compliance with Business Trust
Statute.................................................................. 51
ARTICLE XI MISCELLANEOUS
SECTION 11.1. Supplements and Amendments............................................... 51
SECTION 11.2. No Legal Title to Owner Trust
Estate in Certificateholders............................................. 53
SECTION 11.3. Limitation on Rights of Others........................................... 54
SECTION 11.4. Notices.................................................................. 54
SECTION 11.5. Severability............................................................. 55
SECTION 11.6. Separate Counterparts.................................................... 55
SECTION 11.7. Successors and Assigns................................................... 55
SECTION 11.8. No Petition.............................................................. 55
SECTION 11.9. No Recourse.............................................................. 55
SECTION 11.10. Headings................................................................. 56
SECTION 11.11. Governing Law............................................................ 56
SECTION 11.12. Sale and Servicing Agreement
Obligations.............................................................. 56
iii
5
EXHIBIT A FORM OF CLASS C CERTIFICATE.................................................. A-1
EXHIBIT B FORM OF CLASS D CERTIFICATE.................................................. B-1
EXHIBIT C FORM OF INVESTMENT LETTER -
CLASS C CERTIFICATES......................................................... C-1
EXHIBIT D FORM OF INVESTMENT LETTER -
CLASS D CERTIFICATES QUALIFIED
INSTITUTIONAL BUYER.......................................................... D-1
EXHIBIT E FORM OF INVESTMENT LETTER -
CLASS D CERTIFICATES INSTITUTIONAL
ACCREDITED INVESTOR.......................................................... E-1
EXHIBIT F FORM OF RULE 144A TRANSFEROR
CERTIFICATE - CLASS D CERTIFICATES........................................... F-1
EXHIBIT G FORM OF CERTIFICATE OF TRUST................................................. G-1
APPENDIX A Definitions and Usage........................................................ AA-1
iv
6
AMENDED AND RESTATED TRUST AGREEMENT, dated as of September
1, 1999 (as from time to time amended, supplemented or otherwise modified and in
effect, this "Agreement"), among FORD CREDIT AUTO RECEIVABLES TWO L.P., a
Delaware limited partnership, as Depositor, having its principal executive
xxxxxx xx Xxx Xxxxxxxx Xxxx, Xxxxxxxx, Xxxxxxxx 00000; THE BANK OF NEW YORK
(DELAWARE), a Delaware banking corporation not in its individual capacity but
solely as Delaware trustee under this Agreement (the "Delaware Trustee"),
having its principal corporate trust office at Xxxxx Xxxx Xxxxxx, Xxxxx 000,
Xxxxxx, Xxxxxxxx 00000; and THE BANK OF NEW YORK, a New York banking corporation
(the "Bank"), not in its individual capacity but solely as trustee under this
Agreement (in such capacity, the "Owner Trustee"), having its principal
corporate trust office at 000 Xxxxxxx Xxxxxx, Xxxxx 00X, Xxx Xxxx, Xxx Xxxx
00000 for the purpose of establishing the Ford Credit Auto Owner Trust 1999-D.
Each of the Delaware Trustee and the Owner Trustee are referred to individually
as a "Co-Trustee" and collectively as the "Co-Trustees".
WHEREAS, the parties hereto intend to amend and restate
that certain Trust Agreement, dated as of September 1, 1999, among the
Depositor, the Delaware Trustee and the Owner Trustee, on the terms and
conditions hereinafter set forth;
NOW, THEREFORE, in consideration of the premises and mutual
covenants herein contained, the receipt and sufficiency of which are hereby
acknowledged, the Depositor, the Delaware Trustee and the Owner Trustee hereby
agree as follows:
ARTICLE I
DEFINITIONS AND USAGE
Except as otherwise specified herein or as the context may
otherwise require, capitalized terms used but not otherwise defined herein are
defined in Appendix A hereto, which also contains rules as to usage that shall
be applicable herein.
7
ARTICLE II
ORGANIZATION OF THE TRUST
SECTION 2.1. Name. The Trust created hereby shall be
known as "Ford Credit Auto Owner Trust 1999-D", 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 on behalf of the Trust.
SECTION 2.2. Offices. The Delaware office of the Trust
shall be in care of the Delaware Trustee at the Corporate Trust Office or at
such other address in the State of Delaware as the Delaware Trustee may
designate by written notice to the Certificateholders and the Depositor. The New
York office of the Trust shall be in care of the Owner Trustee at the Corporate
Trust Office or at such other address in the State of New York as the Owner
Trustee may designate by written notice to the Certificateholders and the
Depositor.
SECTION 2.3. Purposes and Powers. (a) The purpose of the
Trust is, and the Trust shall have the power and authority, to engage in the
following activities:
(i) to issue the Notes pursuant to the Indenture, and the
Certificates pursuant to this Agreement, and to sell the Notes and the
Certificates upon the written order of the Depositor;
(ii) with the proceeds of the sale of the Notes and the
Certificates, to fund the Reserve Account, to pay the organizational,
start-up and transactional expenses of the Trust, and to pay the
balance to the Depositor pursuant to the Sale and Servicing Agreement;
(iii) to pay interest on and principal of the Notes and
distributions on the Certificates;
(iv) to Grant the Owner Trust Estate (other than each
Certificate Distribution Account and the proceeds thereof) to the
Indenture Trustee pursuant to the Indenture;
2
8
(v) to enter into and perform its obligations under the
Basic Documents to which it is to be a party;
(vi) 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
(vii) subject to compliance with the Basic Documents, to
engage in such other activities as may be required in connection with
conservation of the Owner Trust Estate and the making of distributions
to the Noteholders and the Certificateholders.
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.
SECTION 2.4. Appointment of Owner Trustee. The Depositor
hereby appoints the Owner Trustee as trustee of the Trust effective as of the
date hereof, to have all the rights, powers and duties set forth herein.
SECTION 2.5. Appointment of Delaware Trustee. The
Delaware Trustee is appointed to serve as the trustee of the Trust in the State
of Delaware for the sole and limited purpose of satisfying the requirement of
Section 3807 of the Delaware Business Trust Statute that the Trust have at least
one trustee with a principal place of business in Delaware. It is understood and
agreed by the parties hereto and the Certificateholders that the Delaware
Trustee shall have none of the duties or liabilities of the Owner Trustee. The
duties of the Delaware Trustee shall be limited to (a) accepting legal process
served on the Trust in the State of Delaware and (b) the execution of any
certificates required to be filed with the Secretary of State of the State of
Delaware which the Delaware Trustee is required to execute pursuant to Section
3811 of the Business Trust Statute, and the Delaware Trustee shall provide
prompt notice to the Owner Trustee of its performance of any such acts. The
parties hereto and the Certificateholders understand and agree that the Delaware
Trustee shall not be entitled to exercise any powers, nor shall the Delaware
Trustee have any of the duties and
3
9
liabilities, of the Owner Trustee. The Delaware Trustee shall not be liable for
the acts or omissions of the Owner Trustee, the Depositor or the Trust. To the
extent that, at law or in equity, the Delaware Trustee has duties (including
fiduciary duties) and liabilities relating thereto to the Trust or to the
Certificateholders, it is hereby understood and agreed by the other parties
hereto and the Certificateholders that such duties and liabilities are replaced
by the duties and liabilities of the Delaware Trustee expressly set forth in
this Trust Agreement. The Delaware Trustee shall owe no fiduciary or other
duties to the Trust or to the Depositor except as expressly provided for herein.
SECTION 2.6. Capital Contribution of Owner Trust Estate.
As of September 1, 1999, the Depositor sold, assigned, transferred, conveyed and
set over to the Owner Trustee the sum of $1. The Owner Trustee hereby
acknowledges receipt in trust from the Depositor, as of such date, of the
foregoing contribution, which shall constitute the initial Owner Trust Estate
and shall be deposited in the Certificate Distribution Account. The Depositor
shall pay the organizational expenses of the Trust as they may arise or shall,
upon the request of the Owner Trustee or the Delaware Trustee, promptly
reimburse the Owner Trustee or the Delaware Trustee for any such expenses paid
by the Owner Trustee or the Delaware Trustee. On the Closing Date, the Depositor
shall convey to the Trust the Trust Property and the Owner Trustee shall convey
to the Depositor the Notes and the Certificates.
SECTION 2.7. Declaration of Trust. The Owner Trustee
hereby declares that it will hold the Owner Trust Estate in trust upon and
subject to the conditions set forth herein for the use and benefit of the
Certificateholders, subject to the obligations of the Trust under the Basic
Documents. It is the intention of the parties hereto that (i) the Trust
constitute a business trust under the Business Trust Statute and that this
Agreement constitute the governing instrument of such business trust and (ii)
for income and franchise tax purposes, the Trust shall be treated as a
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 Depositor and the Notes constituting indebtedness of
the part-
4
10
nership. The parties agree that, unless otherwise required by the appropriate
tax authorities, the Depositor, on behalf of the Trust, will file or cause to be
filed annual or other necessary returns, reports and other forms consistent with
the characterization of the Trust as a partnership for such tax purposes.
Effective as of the date hereof, the Owner Trustee shall have the rights, powers
and duties set forth herein and in the Business Trust Statute with respect to
accomplishing the purposes of the Trust. Together with the Delaware Trustee,
the Owner Trustee has filed the Certificate of Trust with the Secretary of
State.
SECTION 2.8. Liability of the Depositor. (a)
Notwithstanding Section 3803 of the Business Trust Statute, the Depositor in its
capacity as the holder of the interests described in Section 3.11 shall be
liable directly to, and will indemnify each injured party for, all losses,
claims, damages, liabilities and expenses of the Trust (including Expenses, to
the extent that the assets of the Trust that would remain if all of the Notes
were paid in full would be insufficient to pay any such losses, claims, damages,
liabilities or expenses, or to the extent that such losses, claims, damages,
liabilities and expenses in fact are not paid out of the Owner Trust Estate)
that the Depositor would be liable for if the Trust were a partnership under the
Limited Partnership Act in which the Depositor were a general partner; provided,
however, that the Depositor shall not be liable to or indemnify Noteholders or
Note Owners for any losses incurred by Noteholders or Note Owners in their
capacity as holders of or beneficial owners of interests in limited recourse
debt secured by the Owner Trust Estate or be liable to or indemnify
Certificateholders for any losses incurred by the Certificateholders if such
losses would nevertheless have been incurred if the Certificates were limited
recourse debt secured by the Owner Trust Estate. In addition, any third-party
creditors of the Trust, or the arrangement between the Depositor and the Trust
(other than in connection with the obligations described in the preceding
sentence for which the Depositor shall not be liable), shall be deemed
third-party beneficiaries of this paragraph.
(b) No Certificateholder other than the Depositor to the
extent set forth in paragraph (a) of this
5
11
Section 2.8, shall have any personal liability for any liability or obligation
of the Trust.
SECTION 2.9. Title to Trust Property. Legal title to the
entirety of the Owner Trust Estate shall be vested at all times in the Trust as
a separate legal entity, except where applicable law in any jurisdiction
requires title to any part of the Owner Trust Estate to be vested in a trustee
or trustees, in which case title shall be deemed to be vested in the Owner
Trustee, a co-trustee and/or a separate trustee, as the case may be.
SECTION 2.10. Situs of Trust. The Trust shall be
administered in the State of New York. All bank accounts maintained by the Owner
Trustee on behalf of the Trust shall be located in the State of Delaware or the
State of New York. The Trust shall not have any employees in any state other
than the State of Delaware; provided, however, that nothing herein shall
restrict or prohibit the Bank, the Delaware Trustee or the Owner Trustee from
having employees within or without the State of Delaware. Payments will be
received by the Trust only in Delaware or New York, and payments will be made by
the Trust only from Delaware or New York. The principal office of the Trust
shall be in care of the Delaware Trustee in the State of Delaware. The Trust
shall also have an office in care of the Owner Trustee in the State of New York.
SECTION 2.11. Representations and Warranties of the
Depositor. The Depositor hereby represents and warrants to the Owner Trustee
and the Delaware Trustee that:
(a) The Depositor is duly organized and validly existing
as a limited partnership 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 limited partnership in good standing, and has obtained all necessary
licenses and approvals in all jurisdictions in which the ownership or lease of
property or the conduct of its business shall require such qualifications.
6
12
(c) The Depositor has the power and authority to execute
and deliver this Agreement and to carry out its terms, and the Depositor has
full power and authority to sell and assign the property to be sold and assigned
to, and deposited with, the Trust, and the Depositor has duly authorized such
sale and assignment and deposit to the Trust; and the execution, delivery and
performance of this Agreement has been duly authorized by the Depositor.
(d) This Agreement constitutes a legal, valid, and binding
obligation of the Depositor, enforceable against the Depositor in accordance
with its terms, subject, as to enforceability, to applicable bankruptcy,
insolvency, reorganization, conservatorship, receivership, liquidation and other
similar laws and to general equitable principles.
(e) The consummation of the transactions contemplated by
this Agreement and the fulfillment of the terms hereof do not conflict with,
result in any breach of any of the terms and provisions of, or constitute (with
or without notice or lapse of time or both) a default under, the Certificate of
Limited Partnership or the Limited Partnership Agreement, or any indenture,
agreement or other instrument to which the Depositor is a party or by which it
is bound; nor result in the creation or imposition of any lien upon any of its
properties pursuant to the terms of any such indenture, agreement or other
instrument (other than pursuant to the Basic Documents); nor violate any law or,
to the best of the Depositor's knowledge, any order, rule or regulation
applicable to the Depositor of any court or of any federal or state regulatory
body, administrative agency or other governmental instrumentality having
jurisdiction over the Depositor or its properties.
(f) There are no proceedings or investigations pending or,
to the Depositor's best knowledge, 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, the Indenture, any of the other Basic Documents, the Notes or the
Certificates, (ii) seeking to prevent the issuance of the Notes or the
Certificates or the consummation of any of the transactions contemplated by this
Agreement, the Indenture or any of the other Basic Documents, (iii) seeking any
7
13
determination or ruling that might materially and adversely affect the
performance by the Depositor of its obligations under, or the validity or
enforceability of, this Agreement or (iv) which might adversely affect the
federal income tax attributes, or Applicable Tax State franchise or income tax
attributes, of the Notes and the Certificates.
(g) The representations and warranties of the Depositor in
Section 3.1 of the Purchase Agreement are true and correct.
SECTION 2.12. Federal Income Tax Matters. The
Certificateholders acknowledge that it is their intent and that they understand
it is the intent of the Depositor and the Servicer that, for purposes of federal
income, state and local income and franchise tax and any other income taxes, the
Trust will be treated as a partnership and the Certificateholders and the
Depositor will be treated as partners in that partnership. The Depositor hereby
agrees and the Certificateholders by acceptance of a Certificate agree to such
treatment and each agrees to take no action inconsistent with such treatment.
For purposes of federal income, State and local income and franchise tax and any
other income taxes each month:
(a) amounts paid to any Certificateholder pursuant to
Section 5.2(a)(i) shall be treated as a guaranteed payment within the
meaning of Section 707(c) of the Code;
(b) to the extent the characterization provided for in
paragraph (a) of this Section 2.11 is not respected, gross ordinary
income of the Trust for such month as determined for federal income tax
purposes shall be allocated among the Certificateholders of each Class
of Certificates as of the Record Date occurring within such month, in
proportion to their ownership of the Aggregate Certificate Balance on
such date, in an amount up to the sum of (i) the Accrued Class C
Certificate Interest or Accrued Class D Certificate Interest, as
applicable, for such Class for such month, (ii) the portion of the
market discount on the Receivables accrued during such month that is
allocable to the excess, if any, of the aggregate Initial Certificate
8
14
Balance of such class of Certificates over the initial
aggregate issue price of such Class of Certificates and (iii) any
amount expected to be distributed to the Certificateholders of such
Class pursuant to Sections 4.6(c) and (d) of the Sale and Servicing
Agreement (to the extent not previously allocated pursuant to this
paragraph (b)) to the extent necessary to reverse any net loss
previously allocated to Certificateholders of such Class (to the extent
not previously reversed pursuant to this clause (iii)); and
(c) thereafter all remaining net income of the Trust
(subject to the modifications set forth below) for such month as
determined for federal income tax purposes (and each item of income,
gain, credit, loss or deduction entering into the computation thereof)
shall be allocated to the Depositor, to the extent thereof.
If the gross ordinary income of the Trust for any month is insufficient for the
allocations described in paragraph (b) above, subsequent gross ordinary income
shall first be allocated to make up such shortfall before any allocation
pursuant to paragraph (c) above. Net losses of the Trust, if any, for any month
as determined for federal income tax purposes (and each item of income, gain,
credit, loss or deduction entering into the computation thereof) shall be
allocated to the Depositor to the extent the Depositor, in its capacity as
"general partner," is reasonably expected to bear the economic burden of such
net losses, and any remaining net losses shall be allocated among the
Certificateholders as of the Record Date occurring within such month in
proportion to their ownership of the Aggregate Certificate Balance on such
Record Date. The Depositor is authorized to modify the allocations in this
paragraph if necessary or appropriate, in its sole discretion, for the
allocations to fairly reflect the economic income, gain or loss to the Depositor
or the Certificateholders or as otherwise required by the Code.
9
15
ARTICLE III
TRUST CERTIFICATES AND TRANSFER OF INTERESTS
SECTION 3.1. Initial Beneficial Ownership. Upon the
formation of the Trust by the contribution by the Depositor pursuant to Section
2.5 and until the issuance of the Certificates, the Depositor shall be the sole
beneficial owner of the Owner Trust Estate.
SECTION 3.2. Capital Accounts. (a) The Owner Trustee
shall establish and maintain a separate bookkeeping account (a "Capital
Account") for the Depositor and each Certificateholder. The initial balance of
the Capital Account for (i) each Certificateholder shall be the amount initially
paid for such Certificateholder's Certificates and (ii) the Depositor shall be
(x) the fair market value of the Receivables minus (y) the proceeds of the sale
of Notes and Certificates net of the Reserve Initial Deposit. The Capital
Account of the Depositor or each Certificateholder shall also be increased by
(i) the dollar amount of any additional cash contributions made by the Depositor
or such Certificateholder, as the case may be, (ii) the fair market value of any
property (other than cash) contributed to the Trust by the Depositor or such
Certificateholder, as the case may be (net of any liabilities to which the
property is subject), and (iii) allocations to the Depositor or such
Certificateholder, as the case may be, of income and gain (including income
exempt from tax). The Capital Account of the Depositor or each Certificateholder
shall be decreased by (i) the dollar amount of any cash distributions made to
the Depositor or such Certificateholder, as the case may be, (ii) the fair
market value of any property (other than cash) distributed to the Depositor or
such Certificateholder, as the case may be (net of any liabilities to which the
property is subject), (iii) allocations to the Depositor or such
Certificateholder, as the case may be, of loss or deductions (or items thereof),
and (iv) any allocations of expenditures of the Trust described in Section
705(a)(2)(B) of the Code.
(b) Notwithstanding any other provision of this
Agreement to the contrary, the foregoing provisions of this Section 3.2
regarding the maintenance of Capital Accounts shall be construed so as to comply
with the provisions of the Treasury Regulations promulgated
10
16
pursuant to Section 704 of the Code. The Depositor is hereby authorized to
modify these provisions to the minimum extent necessary to comply with such
regulations.
SECTION 3.3. The Certificates. (a) The Class C
Certificates and the Class D Certificates shall each be issued in one or more
registered, definitive, physical certificates, in the form set forth in Exhibit
A and Exhibit B, respectively, in denominations of at least $20,000 and in
integral multiples of $1,000 in excess thereof. No Certificate may be sold,
transferred, assigned, participated, pledged, or otherwise disposed of (any such
act, a "Transfer") to any Person except in accordance with the provisions of
Section 3.5 and any attempted Transfer in violation of Section 3.5 shall be null
and void (each a "Void Transfer").
(b) The Certificates shall be executed on behalf of the
Trust by manual or facsimile signature of an authorized officer of the Owner
Trustee. 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
benefits of this Agreement, notwithstanding that such individuals or any of them
shall have ceased to be so authorized prior to the authentication and delivery
of such Certificates or did not hold such offices at the date of authentication
and delivery of such Certificates.
(c) If Transfer of the Certificates is permitted pursuant
to Section 3.5, a transferee of a Certificate shall become a Certificateholder,
and shall be entitled to the rights and subject to the obligations of a
Certificateholder hereunder upon such transferee's acceptance of a Certificate
duly registered in such transferee's name pursuant to Section 3.5.
SECTION 3.4. Authentication of Certificates. Concurrently
with the initial sale of the Receivables to the Trust pursuant to the Sale and
Servicing Agreement, the Owner Trustee shall cause the Class C Certificates, in
an aggregate principal balance equal to the Initial Certificate Balance of such
Class C Certificates, and the Class D Certificates, in an aggregate principal
balance equal to the Initial Certificate Balance of such Class D Certificates,
to be executed on behalf of the Trust,
11
17
authenticated and delivered to or upon the written order of the Depositor,
signed by the chairman of the board, the president, any executive vice
president, any vice president, the secretary, any assistant secretary, the
treasurer or any assistant treasurer of the General Partner, without further
action by the Depositor, in authorized denominations. No Certificate shall
entitle its Certificateholder to any benefit under this Agreement, or shall be
valid for any purpose, unless there shall appear on such Certificate a
certificate of authentication substantially in the form set forth in Exhibit A
or Exhibit B, as applicable, attached hereto executed by the Owner Trustee by
manual signature; such authentication shall constitute conclusive evidence that
such Certificate shall have been duly authenticated and delivered hereunder. All
Certificates shall be dated the date of their authentication.
SECTION 3.5. Registration of Certificates; Transfer and
Exchange of Certificates. (a) The Certificate Registrar shall keep or cause to
be kept, at the office or agency maintained pursuant to Section 3.9, a
Certificate Register in which, subject to such reasonable regulations as it may
prescribe, the Trust shall provide for the registration of Certificates and of
Transfers and exchanges of Certificates as herein provided. The Bank shall be
the initial Certificate Registrar. No Transfer of a Certificate shall be
recognized except upon registration of such Transfer in the Certificate
Register.
(b) No Transfer of any Class C Certificate shall be
permitted, recognized or recorded unless the prospective transferee of such
Class C Certificate shall provide a letter in the form of Exhibit C hereof to
the Trust, the Owner Trustee and the Certificate Registrar, in which such
prospective transferee shall represent the following:
(i) It is either:
(A) not, and each account (if any) for which it is
purchasing the Class C 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
12
18
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. ss 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); or
(B) an insurance company acting on behalf of a general
account and (1) on the date of purchase less than 25% of
the assets of such general account (as reasonably
determined by it) constitute "plan assets" for purposes of
Title I of ERISA and Section 4975 of the Code, (2) the
purchase and holding of such Class C Certificates are
eligible for exemptive relief under Sections (I) and (III)
of Prohibited Transaction Class Exemption 95-60, and (3)
the purchaser agrees that if, after the purchaser's initial
acquisition of the Class C Certificates, at any time during
any calendar quarter 25% or more of the assets of such
general account (as reasonably determined by it no less
frequently than each calendar quarter) constitute "plan
assets" for purposes of Title I of ERISA or Section 4975 of
the Code and no exemption or exception from the prohibited
transaction rules applies to the continued holding of the
Class C Certificates under Section 401(c) of ERISA and the
final regulations thereunder or under an exemption or
regulation issued by the United States Department of Labor
under ERISA, it will dispose of all Class C Certificates
then held in its general account by the end of the next
following calendar quarter.
(ii) It is, and each account (if any) for which it is
purchasing the Class C Certificates is, a Person who is (A) a citizen
or resident of the
13
19
United States, (B) a corporation or partnership organized in or under
the laws of the United States or any political subdivision thereof,
(C) an estate the income of which is includible gross income for United
States tax purposes, regardless of its source, (D) a trust if a U.S.
court is able to exercise primary supervision over the administration
of such trust and one or more Persons meeting the conditions of clause
(A), (B), (C) or (E) of this paragraph (ii) has the authority to
control all substantial decisions of the trust or (E) a Person not
described in clauses (A) through (D) above whose ownership of the Class
C Certificates is effectively connected with such Person's conduct of a
trade or business within the United States (within the meaning of the
Code) and who provides the Owner Trustee and the Depositor with an IRS
Form 4224 (and such other certifications, representations, or opinions
of counsel as may be requested by the Owner Trustee or the Depositor).
(iii) It understands that any purported Transfer of any
Class C Certificate (or any interest therein) to any Person who does
not meet the conditions of paragraphs (i) and (ii) above shall be a
Void Transfer, and the purported transferee in a Void Transfer shall
not be recognized by the Trust or any other Person as a
Certificateholder for any purpose.
(iv) It agrees that if it determines to Transfer any of the
Class C Certificates it will cause its proposed transferee to provide
to the Trust, the Owner Trustee and the Certificate Registrar a letter
substantially in the form of Exhibit C hereof or such other written
statement as the Depositor shall prescribe.
(c) Each Class D Certificate shall bear a legend to the
following effect unless determined otherwise by the Administrator (as certified
to the Owner Trustee in an Officer's Certificate) and the Owner Trustee
consistent with applicable law:
"THIS CERTIFICATE HAS NOT BEEN AND WILL NOT BE
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"),
OR UNDER ANY STATE SECURITIES OR
14
20
BLUE SKY LAW OF ANY STATE OF THE UNITED STATES. THE HOLDER HEREOF, BY PURCHASE
THIS CERTIFICATE, AGREES FOR THE BENEFIT OF THE TRUST AND THE DEPOSITOR THAT
THIS CERTIFICATE MAY BE REOFFERED, RESOLD, PLEDGED OR OTHERWISE TRANSFERRED ONLY
IN COMPLIANCE WITH THE SECURITIES ACT AND OTHER APPLICABLE LAWS, AND ONLY (1)
PURSUANT TO RULE 144A UNDER THE SECURITIES ACT ("RULE 144A") TO A PERSON THAT
THE HOLDER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER, WITHIN THE
MEANING OF RULE 144A (A "QIB"), PURCHASING FOR ITS OWN ACCOUNT OR FOR THE
ACCOUNT OF A QIB, WHOM THE HOLDER HAS INFORMED, IN EACH CASE, THAT THE REOFFER,
RESALE, PLEDGE, OR OTHER TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A,
SUBJECT TO (A) THE RECEIPT BY THE TRUST AND THE CERTIFICATE REGISTRAR OF A
CERTIFICATE SUBSTANTIALLY IN THE FORM ATTACHED AS EXHIBIT F TO THE TRUST
AGREEMENT AND (B) THE RECEIPT BY THE TRUST AND THE CERTIFICATE REGISTRAR OF A
LETTER SUBSTANTIALLY IN THE FORM ATTACHED AS EXHIBIT D TO THE TRUST AGREEMENT,
WITH SUCH CHANGES THEREIN AS MAY BE APPROVED BY THE DEPOSITOR, (2) PURSUANT TO
AN EXEMPTION FROM REGISTRATION PROVIDED BY RULE 144 UNDER THE SECURITIES ACT
(IF AVAILABLE), SUBJECT TO THE RECEIPT BY THE TRUST, THE INITIAL PURCHASER AND
THE CERTIFICATE REGISTRAR OF SUCH EVIDENCE ACCEPTABLE TO THE TRUST AND THE
INITIAL PURCHASER THAT SUCH REOFFER, RESALE, PLEDGE OR TRANSFER IS IN COMPLIANCE
WITH THE TRUST AGREEMENT AND THE SECURITIES ACT AND OTHER APPLICABLE LAWS, (3)
TO AN INSTITUTIONAL "ACCREDITED INVESTOR" WITHIN THE MEANING THEREOF IN RULE 501
(a)(1), (2), (3) OR (7) OF REGULATION D UNDER THE SECURITIES ACT PURSUANT TO ANY
OTHER EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT,
SUBJECT TO (A) THE RECEIPT BY THE TRUST AND THE CERTIFICATE REGISTRAR OF A
LETTER SUBSTANTIALLY IN THE FORM ATTACHED AS EXHIBIT E TO THE TRUST AGREEMENT OR
(B) THE RECEIPT BY THE TRUST, THE INITIAL PURCHASER AND THE CERTIFICATE
REGISTRAR OF SUCH OTHER EVIDENCE ACCEPTABLE TO THE TRUST AND THE INITIAL
PURCHASER THAT SUCH REOFFER, RESALE, PLEDGE OR TRANSFER IS IN COMPLIANCE WITH
THE TRUST AGREEMENT AND THE SECURITIES ACT AND OTHER APPLICABLE LAWS, OR (4) TO
THE DEPOSITOR OR ITS AFFILIATES, IN EACH CASE IN ACCORDANCE WITH ALL APPLICABLE
SECURITIES LAWS OF THE UNITED STATES AND SECURITIES AND BLUE SKY LAWS OF THE
STATES OF THE UNITED STATES."
As a condition to the registration of any Transfer of a
Class D Certificate, the prospective transferee of such a Class D Certificate
shall be required to
15
21
represent in writing to the Owner Trustee, the Certificate Registrar and the
Initial Purchaser the following, unless determined otherwise by the
Administrator (as certified to the Owner Trustee in an Officer's Certificate):
(i) It understands that no subsequent Transfer of the Class
D Certificates is permitted unless it causes its proposed transferee to
provide to the Trust, the Certificate Registrar and the Initial
Purchaser a letter substantially in the form of Exhibit D or Exhibit E
hereof (with such changes therein as may be approved by the Depositor),
as applicable, or such other written statement as the Depositor shall
prescribe.
(ii) It is not, and each account (if any) for which it is
purchasing the Class D Certificates is not, (A) an employee benefit
plan, as defined in Section 3(3) of ERISA, that is subject to Title I
of ERISA, (B) a plan described in Section 4975(e)(1) of the Code that
is subject to Section 4975 of the Code, (C) 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, (D) 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 (E) a person
investing "plan assets" of any such plan (including without limitation,
for purposes of this clause (E), subject to any exceptions approved by
the Depositor, an insurance company general account, but excluding any
entity registered under the Investment Company Act of 1940, as
amended).
(iii) It is a person who is (A) a citizen or resident of
the United States, (B) a corporation or partnership organized in or
under the laws of the United States or any political subdivision
thereof, (c) an estate the income of which is includible in gross
income for United States tax purposes, regardless of its source, (D) a
trust if a U.S. court is able to exercise primary supervision over the
administration of such trust and one or more persons
16
22
described in clause (A), (B), (C) or (E) of this paragraph (iii) has
the authority to control all substantial decisions of the trust or (E)
a person not described in clauses (A) though (D) of this paragraph
(iii) whose ownership of the Class D Certificates is effectively
connected with such person's conduct of a trade or business within the
United States (within the meaning of the Code) and who provides the
Trust and the Depositor with an IRS Form 4224 (and such other
certifications, representations, or opinions of counsel as may be
requested by the Trust or the Depositor).
(iv) It understands that any purported Transfer of any
Class D Certificate (or any interest therein) in contravention of any
of the restrictions and conditions contained in this Section will be a
Void Transfer, and the purported transferee in a Void Transfer will not
be recognized by the Trust or any other person as a Certificateholder
for any purpose.
(d) By acceptance of any Class D Certificate, the
Certificateholder thereof specifically agrees with and represents to the
Depositor, the Trust and the Certificate Registrar, that no Transfer of such
Class D Certificate shall be made unless the registration requirements of the
Securities Act and any applicable State securities laws are complied with, or
such Transfer is exempt from the registration requirements under the Securities
Act because the Transfer satisfies one of the following:
(i) such Transfer is in compliance with Rule 144A under the
Securities Act ("Rule 144A"), to a transferee who the transferor
reasonably believes is a Qualified Institutional Buyer that is
purchasing for its own account or for the account of a Qualified
Institutional Buyer and to whom notice is given that such Transfer is
being made in reliance upon Rule 144A under the Securities Act and (x)
the transferor executes and delivers to the Trust and the Certificate
Registrar, a Rule 144A transferor certificate substantially in the form
attached as Exhibit F and (y) the transferee executes and delivers to
the Trust and the Certificate Registrar an
17
23
investment letter substantially in the form attached as Exhibit D;
(ii) after the appropriate holding period, such Transfer is
pursuant to an exemption from registration under the Securities Act
provided by Rule 144 under the Securities Act and the transferee, if
requested by the Trust, the Certificate Registrar or the Initial
Purchaser, delivers an Opinion of Counsel in form and substance
satisfactory to the Trust and the Initial Purchaser; or
(iii) such Transfer is to an institutional accredited
investor as defined in rule 501(a)(1), (2), (3) or (7) of Regulation D
promulgated under the Securities Act in a transaction exempt from the
registration requirements of the Securities Act, such Transfer is in
accordance with any applicable securities laws of any State of the
United States or any other jurisdiction, and such investor executes and
delivers to the Trust and the Certificate Registrar an investment
letter substantially in the form attached as Exhibit E.
(e) The Depositor shall make available to the prospective
transferor and transferee of a Class D Certificate information requested to
satisfy the requirements of paragraph (d)(4) of Rule 144A (the "Rule 144A
Information"). The Rule 144A Information shall include any or all of the
following items requested by the prospective transferee:
(i) the private placement memorandum, if any, relating to
the Class D Certificates, and any amendments or supplements thereto;
(ii) each statement delivered to Certificateholders
pursuant to Section 5.2(b) on each Distribution Date preceding such
request; and
(iii) such other information as is reasonably available to
the Owner Trustee in order to comply with requests for information
pursuant to Rule 144A under the Securities Act.
None of the Depositor, the Certificate Registrar or the
Owner Trustee is under an obligation to
18
24
register any Class D Certificate under the Securities Act or any other
securities law.
(f) Upon surrender for registration of Transfer of any
Certificate at the office or agency maintained pursuant to Section 3.9 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 Certificates in authorized
denominations of a like Class and aggregate amount dated the date of
authentication by the Owner Trustee or any authenticating agent. At the option
of a Certificateholder, Certificates may be exchanged for other Certificates of
authorized denominations of a like Class and aggregate amount upon surrender of
the Certificates to be exchanged at the office or agency maintained pursuant to
Section 3.9.
Every 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 Certificateholder or his attorney duly authorized in writing,
with such signature guaranteed by a member firm of the New York Stock Exchange
or a commercial bank or trust company. Each 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 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 3.5 notwithstanding,
the Owner Trustee shall not make and the Certificate Registrar need not register
any Transfer or exchange of Certificates for a period of fifteen (15) days
preceding any Distribution Date for any payment with respect to the
Certificates.
SECTION 3.6. Mutilated, Destroyed, Lost or Stolen
Certificates. If (a) any mutilated Certificate
19
25
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 Certificate and (b) 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 notice that such
Certificate shall have 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 Certificate a new Certificate of like Class, tenor and denomination.
In connection with the issuance of any new Certificate under this Section 3.6,
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 therewith. Any duplicate Certificate issued pursuant to this Section
3.6 shall constitute conclusive evidence of ownership in the Trust, as if
originally issued, whether or not the lost, stolen or destroyed Certificate
shall be found at any time.
SECTION 3.7. Persons Deemed Owners of Certificates. Prior
to due presentation of a Certificate for registration of Transfer, the Owner
Trustee, the Certificate Registrar and any Certificate Paying Agent may treat
the Person in whose name any Certificate shall be registered in the Certificate
Register as the owner of such Certificate for the purpose of receiving
distributions pursuant to Section 5.2 and for all other purposes whatsoever, and
none of the Owner Trustee, the Certificate Registrar or any Certificate Paying
Agent shall be bound by any notice to the contrary.
SECTION 3.8. Access to List of Certificateholders' Names
and Addresses. The Owner Trustee shall furnish or cause to be furnished to the
Servicer and the Depositor, or to the Indenture Trustee, within fifteen (15)
days after receipt by the Owner Trustee of a written request therefor from the
Servicer or the Depositor, or the Indenture Trustee, as the case may be, a list,
in such form as the requesting party may reasonably require, of the names and
addresses of the Certificateholders as of the most recent Record Date. If
three or more Certificateholders or one or more Certificateholders of
Certificates evidencing not less
20
26
than 25% of the Aggregate Certificate Balance 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 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 (5) 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
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.
SECTION 3.9. Maintenance of Office or Agency. The Owner
Trustee shall maintain in the State of New York, an office or offices or agency
or agencies where 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 Certificates and the Basic Documents may be served. The Owner
Trustee initially designates The Bank of New York, 000 Xxxxxxx Xxxxxx, Xxxxx 12
East, New York, New York 10286, Attention: Asset-Backed Finance Unit as its
principal corporate trust office for such purposes. The Owner Trustee shall give
prompt written notice to the Depositor and to the Certificateholders of any
change in the location of the Certificate Registrar or any such office or
agency.
SECTION 3.10. Appointment of Certificate Paying Agent. The
Certificate Paying Agent shall make distributions to Certificateholders from
each Certificate Distribution Account pursuant to Section 5.2 and shall report
the amounts of such distributions to the Owner Trustee. Any Certificate Paying
Agent shall have the revocable power to withdraw funds from each Certificate
Distribution Account for the purpose of making the distributions referred to
above. The Owner Trustee may revoke such power and remove the Certificate Paying
Agent if the Owner Trustee determines in its sole discretion that the
Certificate Paying Agent shall have failed to perform its obligations under this
Agreement in any material respect. The Certificate Paying Agent shall
21
27
initially be the Owner Trustee, and any co-paying agent chosen by the Owner
Trustee. The Owner Trustee shall be permitted to resign as Certificate Paying
Agent upon thirty (30) days' written notice to the Owner Trustee. In the event
that the Bank shall no longer be the Certificate Paying Agent, the Owner Trustee
shall appoint a successor to act as Certificate Paying Agent (which shall be a
bank or trust company). The Owner Trustee shall cause such successor Certificate
Paying Agent or any additional Certificate Paying Agent appointed by the Owner
Trustee to execute and deliver to the Owner Trustee an instrument in which such
successor Certificate Paying Agent or additional Certificate Paying Agent shall
agree with the Owner Trustee that as Certificate Paying Agent, such successor
Certificate Paying Agent or additional Certificate 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 Certificate Paying Agent shall return all
unclaimed funds to the Owner Trustee and upon removal of a Certificate Paying
Agent such Certificate Paying Agent shall also return all funds in its
possession to the Owner Trustee. The provisions of Sections 7.1, 7.3, 7.4 and
8.1 shall apply to the Owner Trustee also in its role as Certificate Paying
Agent, for so long as the Owner Trustee shall act as Certificate Paying Agent
and, to the extent applicable, to any other paying agent appointed hereunder.
Any reference in this Agreement to the Certificate Paying Agent shall include
any co-paying agent unless the context requires otherwise.
SECTION 3.11. Certain Rights of Depositor. The Depositor
shall be entitled to any amounts not needed on any Distribution Date to make
payments on the Notes or the Certificates or to make deposits to the Reserve
Account pursuant to Section 4.6 of the Sale and Servicing Agreement, and to
receive amounts remaining in the Reserve Account following the payment in full
of the aggregate principal amount of the Notes and the Aggregate Certificate
Balance and of all other amounts owing or to be distributed hereunder or under
the Indenture or the Sale and Servicing Agreement to Noteholders and
Certificateholders and the termination of the Trust. The Depositor may not
Transfer any such rights unless it shall have received an Opinion of Counsel
that such Transfer shall not cause the Trust to be classified as an
22
28
association (or publicly traded partnership) taxable as a corporation.
ARTICLE IV
ACTIONS BY OWNER TRUSTEE
SECTION 4.1. Prior Notice to Certificateholders with
Respect to Certain Matters. It is the intention of the Depositor and the
Certificateholders that the powers and duties of the Owner Trustee are
ministerial and non-ministerial; provided, however, that any non-ministerial
action (including the taking of any legal action) may only be taken by the Owner
Trustee in accordance with this Section 4.1. With respect to the following
matters, the Owner Trustee shall not take action unless, (I) at least thirty
(30) days before the taking of such action, the Owner Trustee shall have
notified the Certificateholders and the Rating Agencies in writing of the
proposed action and (II) Certificateholders holding not less than a majority of
the Aggregate Certificate Balance shall not have notified the Owner Trustee in
writing prior to the 30th day after such notice is given that such
Certificateholders have withheld consent or provided alternative direction:
(a) the initiation of any material claim or lawsuit by the
Trust (except claims or lawsuits brought by the Servicer in connection
with the collection of the Receivables) and the settlement of any
material action, claim or lawsuit brought by or against the Trust
(except with respect to the aforementioned claims or lawsuits for
collection by the Servicer of the Receivables);
(b) the election by the Trust to file an amendment to the
Certificate of Trust (unless such amendment is required to be filed
under the Business Trust Statute);
(c) the amendment of the Indenture by a supplemental
indenture in circumstances where the consent of any Noteholder is
required;
(d) the amendment of the Indenture by a supplemental
indenture in circumstances where the
23
29
consent of any Noteholder is not required and such amendment materially
adversely affects the interests of any of the Certificateholders;
(e) the amendment, change or modification of the Sale and
Servicing Agreement or the Administration Agreement, except to cure any
ambiguity or to amend or supplement any provision in a manner or to add
any provision that would not materially adversely affect the interests
of the Certificateholders; or
(f) the appointment pursuant to the Indenture of a
successor Note Registrar, Note 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, Note Paying Agent or
Indenture Trustee or Certificate Registrar of its obligations under the
Indenture or this Agreement, as applicable.
SECTION 4.2. Action by Certificateholders with Respect to
Certain Matters. The Owner Trustee may not, except upon the occurrence of an
Event of Servicing Termination subsequent to the payment in full of the Notes
and in accordance with the written direction of Certificateholders holding not
less than a majority of the Aggregate Certificate Balance, (a) remove the
Servicer under the Sale and Servicing Agreement pursuant to Article VIII
thereof, (b) appoint a successor Servicer pursuant to Article VIII of the Sale
and Servicing Agreement, (c) remove the Administrator under the Administration
Agreement pursuant to Section 9 thereof or (d) appoint a successor Administrator
pursuant to Section 9 of the Administration Agreement.
SECTION 4.3. Action by Certificateholders with Respect to
Bankruptcy. The Owner Trustee shall not have the power to commence a voluntary
proceeding in bankruptcy relating to the Trust unless the Notes have been paid
in full and each Certificateholder (other than the Depositor) approves of such
commencement in advance and delivers to the Owner Trustee a certificate
certifying that such Certificateholder reasonably believes that the Trust is
insolvent.
24
30
SECTION 4.4. Restrictions on Certificateholders' Power.
The Certificateholders shall not direct the Owner Trustee to take or 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 or any of the
other Basic Documents or would be contrary to Section 2.3, nor shall the Owner
Trustee be obligated to follow any such direction, if given.
SECTION 4.5. 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 of Certificates evidencing
not less than a majority of the Aggregate Certificate Balance. Except as
expressly provided herein, any written notice of the Certificateholders
delivered pursuant to this Agreement shall be effective if signed by
Certificateholders of Certificates evidencing not less than a majority of the
Aggregate Certificate Balance at the time of the delivery of such notice.
ARTICLE V
APPLICATION OF TRUST FUNDS; CERTAIN DUTIES
SECTION 5.1. Establishment of Certificate Distribution
Account. Pursuant to Section 4.1(c) of the Sale and Servicing Agreement, there
has been established and there shall be maintained two segregated trust
accounts, each in the name of "The Bank of New York, as Owner Trustee" at a
Qualified Institution or Qualified Trust Institution (which shall initially be
the corporate trust department of the Bank), which shall be designated as the
"Certificate Interest Distribution Account" and the "Certificate Principal
Distribution Account," respectively (each of the Certificate Interest
Distribution Account and the Certificate Principal Distribution Account, a
"Certificate Distribution Account"). Except as expressly provided in Section
3.10, each Certificate Distribution Account shall be under the sole dominion and
control of the Owner Trustee. All monies deposited from time to time in each
Certificate Distribution Account pursuant to the Sale and Servicing Agreement
shall be applied as provided in the Basic Documents. In the event that either
Certificate Distribution Account is no longer
25
31
to be maintained at the corporate trust department of the Bank, the Servicer
shall, with the Owner Trustee's assistance as necessary, cause such Certificate
Distribution Account to be moved to a Qualified Institution or a Qualified Trust
Institution within ten (10) Business Days (or such longer period not to exceed
thirty (30) calendar days as to which each Rating Agency may consent). Each
Certificate Distribution Account will be established and maintained pursuant to
an account agreement which specifies New York law as the governing law.
SECTION 5.2. Application of Trust Funds. (a) On each
Distribution Date, the Owner Trustee shall, based on the information contained
in the Servicer's Certificate delivered on the relevant Determination Date
pursuant to Section 3.9 of the Sale and Servicing Agreement:
(i) withdraw the amounts deposited into the
Certificate Interest Distribution Account pursuant to
Section 4.6(c) of the Sale and Servicing Agreement on or
prior to such Distribution Date and make or cause to be
made distributions and payments in the following order of
priority:
(1) first, to the Certificateholders of
Class C Certificates, an amount equal to the Accrued
Class C Certificate Interest, provided that if there
are not sufficient funds available to pay the entire
amount of the Accrued Class C Certificate Interest,
the amounts available shall be applied to the payment
of such interest on the Class C Certificates on a pro
rata basis;
(2) second, to the Certificateholders of
Class D Certificates, an amount equal to the Accrued
Class D Certificate Interest; provided that if there
are not sufficient funds available to pay the entire
amount of the Accrued Class D Certificate Interest,
the amounts available shall be applied to the payment
of such interest on the Class D Certificates on a pro
rata basis; and
26
32
(3) third, to the Depositor, any funds
remaining on deposit in the Certificate Interest
Distribution Account.
(ii) withdraw the amounts deposited into the
Certificate Principal Distribution Account pursuant to
Section 4.6(c) and (d) of the Sale and Servicing Agreement
on or prior to such Distribution Date and make or cause to
be made distributions and payments in the following order
of priority:
(1) first, to the Certificateholders of the
Class C Certificates in reduction of the Certificate
Balance of the Class C Certificates, until the
Certificate Balance of the Class C Certificates has
been reduced to zero; provided that if there are not
sufficient funds available to reduce the Certificate
Balance of the Class C Certificates to zero, the
amounts available shall be applied to the reduction
of the Certificate Balance of the Class C
Certificates on a pro rata basis;
(2) second, to the Certificateholders of the
Class D Certificates in reduction of the Certificate
Balance of the Class D Certificates, until the
Certificate Balance of the Class D Certificates has
been reduced to zero; provided that if there are not
sufficient funds available to reduce the Certificate
Balance of the Class D Certificates to zero, the
amounts available shall be applied to the reduction
of the Certificate Balance of the Class D
Certificates on pro rata basis; and
(3) third, to the Depositor, any funds
remaining on deposit in the Certificate Principal
Distribution Account.
(b) On each Distribution Date, the Owner Trustee shall, or
shall cause the Certificate Paying Agent to, send to each Certificateholder as
of the related Record Date the statement provided to the Owner
27
33
Trustee by the Servicer pursuant to Section 4.9 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 5.2. The Owner Trustee and each Certificate Paying
Agent is hereby authorized and directed to retain from amounts otherwise
distributable to the Certificateholders sufficient funds for the payment of any
such withholding tax that is legally owed by the Trust (but such authorization
shall not prevent the Owner Trustee from contesting any such tax in appropriate
proceedings, and withholding payment of such tax, if permitted by law, pending
the outcome of such proceedings). The amount of any withholding tax imposed with
respect to a Certificateholder shall be treated as cash distributed to such
Certificateholder at the time it is withheld by the Trust and remitted to the
appropriate taxing authority. If there is a possibility that withholding tax is
payable with respect to a distribution (such as a distribution to a non-U.S.
Certificateholder), the Owner Trustee may, in its sole discretion, withhold such
amounts in accordance with this paragraph (c). In the event that a
Certificateholder wishes to apply for a refund of any such withholding tax, the
Owner Trustee shall reasonably cooperate with such Certificateholder in making
such claim so long as such Certificateholder agrees to reimburse the Owner
Trustee for any out-of-pocket expenses incurred.
SECTION 5.3. Method of Payment. Subject to Section
9.1(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 (i) such Certificateholder shall have
provided to the Certificate Registrar appropriate written instructions at least
five (5) Business Days prior to such Distribution Date and such
Certificateholder's Certificates in the aggregate evidence a denomination of not
less than $1,000,000, or (ii) such Certificateholder is the Depositor or, if
not, by check mailed to such
28
34
Certificateholder at the address of such Certificateholder appearing in the
Certificate Register. Notwithstanding the foregoing, the final distribution in
respect of any Certificate (whether on the applicable Final Scheduled
Distribution Date or otherwise) will be payable only upon presentation and
surrender of such Certificate at the office or agency maintained for that
purpose by the Owner Trustee pursuant to Section 3.9.
SECTION 5.4. No Segregation of Monies; No Interest.
Subject to Sections 5.1 and 5.2, monies received by the Owner Trustee hereunder
need not be segregated in any manner except to the extent required by law, the
Indenture 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 5.5. Accounting and Reports to Noteholders,
Certificateholders, Internal Revenue Service and Others. The Owner Trustee
shall, based on information provided by or on behalf of the Depositor, (a)
maintain (or cause to be maintained) the books of the Trust on a calendar year
basis on the accrual method of accounting, (b) deliver (or cause to be
delivered) to each Certificateholder, as may be required by the Code and
applicable Treasury Regulations, such information as may be required (including
Schedule K-1) to enable each Certificateholder to prepare its federal and State
income tax returns, (c) file (or cause to be filed) such tax returns relating to
the Trust (including a partnership information return, IRS Form 1065), and make
such elections as may from time to time be required or appropriate under any
applicable State or federal statute or rule or regulation thereunder so as to
maintain the Trust's characterization as a partnership for federal income tax
purposes, (d) cause such tax returns to be signed in the manner required by law
and (e) collect (or cause to be collected) any withholding tax as described in
and in accordance with Section 5.2(c) with respect to income or distributions to
Certificateholders. The Owner Trustee shall elect under Section 1278 of the Code
to include in income currently any market discount that accrues with respect to
the Receivables. The Owner Trustee shall not make the election provided under
Section 754 of the Code.
29
35
SECTION 5.6. Signature on Returns; Tax Matters Partner.
(a) The Depositor, as general partner for income tax purposes, shall prepare (or
cause to be prepared) and sign, on behalf of the Trust, the tax returns of the
Trust.
(b) The Depositor shall be designated the "tax matters
partner" of the Trust pursuant to Section 6231(a)(7)(A) of the Code and
applicable Treasury Regulations.
ARTICLE VI
AUTHORITY AND DUTIES OF OWNER TRUSTEE
SECTION 6.1. General Authority. The Owner Trustee is
authorized and directed to execute and deliver on behalf of the Trust the Basic
Documents to which the Trust is to be a party and each certificate or other
document attached as an exhibit to or contemplated by the Basic Documents to
which the Trust is to be a party and any amendment or other agreement, in each
case, in such form as the Depositor shall approve, as evidenced conclusively by
the Owner Trustee's execution thereof and the Depositor's execution of this
Agreement, and to direct the Indenture Trustee to authenticate and deliver (i)
Class A-1 Notes in the aggregate principal amount of $153,000,000, (ii) Class
A-2 Notes in the aggregate principal amount of $449,000,000, (iii) Class A-3
Notes in the aggregate principal amount of $1,370,000,000, (iv) Class A-4 Notes
in the aggregate principal amount of $400,000,000, (v) Class A-5 Notes in the
aggregate principal amount of $588,189,000 and (vi) Class B Notes in the
aggregate principal amount of $109,640,000. 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 on behalf of the Trust as is permitted by the Basic
Documents and which the Servicer or the Administrator directs with respect to
the Basic Documents, except to the extent that this Agreement expressly requires
the consent of Certificateholders for such action.
SECTION 6.2. General Duties. Subject to Section 4.1
hereof, it shall be the duty of the Owner
30
36
Trustee to discharge (or cause to be discharged) all of its responsibilities
pursuant to the terms of this Agreement and the other Basic Documents to which
the Trust is a party and to administer the Trust in the interest of the
Certificateholders, subject to the lien of the Indenture and in accordance with
the provisions of this Agreement and the other Basic Documents. Notwithstanding
anything else to the contrary in this Agreement, the Owner Trustee shall be
deemed to have discharged its duties and responsibilities hereunder and under
the Basic Documents to the extent the Administrator is required in the
Administration Agreement to perform any act or to discharge such duty of the
Owner Trustee or the Trust hereunder or under any other Basic Document, and the
Owner Trustee shall not be held liable for the default or failure of the
Administrator to carry out its obligations under the Administration Agreement.
Except as expressly provided in the Basic Documents, the Owner Trustee shall
have no obligation to administer, service or collect the Receivables or to
maintain, monitor or otherwise supervise the administration, servicing or
collection of the Receivables.
SECTION 6.3. 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.
(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 other 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 any other Basic Document, the Owner Trustee shall promptly give
notice (in such form as shall be appropriate under the circumstances) to the
Certificateholders 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 the Certificateholders received, the Owner
Trustee shall not
31
37
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 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.
(d) In the event the Owner Trustee is unsure as to the
application of any provision of this Agreement or any other 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 requesting instruction and, to the extent that the Owner
Trustee acts or refrains from acting in good faith in accordance with any such
instruction received, 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 (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
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 6.4. No Duties Except as Specified in this
Agreement or in Instructions. The Owner Trustee shall not have any duty or
obligation to manage, make any payment with respect to, register, record, sell,
dispose of, or otherwise deal with the Owner Trust Estate, or to 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,
32
38
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 6.3;
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 lien
(other than the lien of the Indenture) on any part of the Owner Trust Estate
that results from actions by, or claims against, the Owner Trustee that are not
related to the ownership or the administration of the Owner Trust Estate.
SECTION 6.5. No Action Except Under Specified Documents or
Instructions. The Owner Trustee shall not manage, control, use, sell, dispose of
or otherwise deal with any part of the Owner Trust Estate except (i) in
accordance with the powers granted to and the authority conferred upon the Owner
Trustee pursuant to this Agreement, (ii) in accordance with the other Basic
Documents to which the Trust or the Owner Trust is a party and (iii) in
accordance with any document or instruction delivered to the Owner Trustee
pursuant to Section 6.3. Neither the Depositor nor the Certificateholders shall
direct the Trustee to take any action that would violate the provisions of this
Section 6.5.
SECTION 6.6. Restrictions. The Owner Trustee shall not
take any action (a) that is inconsistent with the purposes of the Trust set
forth in Section 2.3 or (b) that, to the actual knowledge of the Owner Trustee,
would (i) affect the treatment of the Notes as indebtedness for federal income
or Applicable Tax State income or franchise tax purposes, (ii) be deemed to
cause a taxable exchange of the Notes for federal income or Applicable Tax State
income or franchise tax purposes or (iii) cause the Trust or any portion thereof
to be taxable as an association (or publicly traded partnership) taxable as a
corporation for federal income or Applicable Tax State income or franchise tax
purposes. The Certificateholders
33
39
shall not direct the Owner Trustee to take action that would violate the
provisions of this Section 6.6.
ARTICLE VII
REGARDING THE OWNER TRUSTEE AND THE DELAWARE TRUSTEE
SECTION 7.1. Acceptance of Trusts and Duties. Each of the
Owner Trustee and the Delaware Trustee accept the trusts hereby created and each
agrees to perform its duties hereunder with respect to such trusts but only upon
the terms of this Agreement. Each Co-Trustee also agrees to disburse all monies
actually received by it constituting part of the Owner Trust Estate upon the
terms of this Agreement and the other Basic Documents to which each Co-Trustee
is a party. Each Co-Trustee shall not be answerable or accountable hereunder or
under any other Basic Document under any circumstances, except (i) for its own
willful misconduct, bad faith or negligence or (ii) in the case of the
inaccuracy of any representation or warranty contained in Section 7.3 expressly
made by either Co-Trustee. In particular, but not by way of limitation (and
subject to the exceptions set forth in the preceding sentence):
(a) the Co-Trustees shall not be liable for any error of
judgment made by a responsible officer of either of the Co-Trustees;
(b) the Co-Trustees shall not be liable with respect to any
action taken or omitted to be taken by them in accordance with the
instructions of any Certificateholder, the Indenture Trustee, the
Depositor, the Administrator or the Servicer;
(c) no provision of this Agreement or any other Basic
Document shall require the Co-Trustees to expend or risk funds or
otherwise incur any financial liability in the performance of any of
their rights or powers hereunder or under any other Basic Document if
the Co-Trustees 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 them;
34
40
(d) under no circumstances shall the Co- Trustees be liable
for indebtedness evidenced by or arising under any of the Basic
Documents, including the principal of and interest on the Notes or
amounts distributable on the Certificates;
(e) the Co-Trustees 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 Owner Trust
Estate or for or in respect of the validity or sufficiency of the other
Basic Documents, other than the certificate of authentication on the
Certificates, and the Co- Trustees 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 and in
the other Basic Documents;
(f) the Co-Trustees shall not be liable for the default or
misconduct of the Servicer, the Administrator, the Depositor or the
Indenture Trustee under any of the Basic Documents or otherwise and the
Co-Trustees shall have no obligation or liability to perform the
obligations of the Trust under this Agreement or the other Basic
Documents that are required to be performed by the Administrator under
the Administration Agreement, the Servicer under the Sale and Servicing
Agreement or the Indenture Trustee under the Indenture; and
(g) the Co-Trustees shall be under no obligation to
exercise any of the rights or powers vested in them by this Agreement,
or to institute, conduct or defend any litigation under this Agreement
or otherwise or in relation to this Agreement or any other Basic
Document, at the request, order or direction of any of the
Certificateholders, unless such Certificateholders have offered to the
Co-Trustees security or indemnity satisfactory to them against the
costs, expenses and liabilities that may be incurred by the Co-Trustees
therein or thereby. The right of the Co-Trustees to perform any
discretionary act enumerated in this Agreement or in any other Basic
Document shall not be construed as a duty, and the Co-Trustees shall
not be answerable
35
41
for other than the willful misconduct, bad faith or negligence of
either of them in the performance of any such act.
SECTION 7.2. 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.
SECTION 7.3. Representations and Warranties. (a) The
Owner Trustee hereby represents and warrants to the Depositor, for the benefit
of the Certificateholders, that:
(i) It is a banking corporation duly organized and validly
existing in good standing under the laws of the State of New York. It
has all requisite corporate power and authority to execute, deliver and
perform its obligations under this Agreement.
(ii) It has taken all corporate action necessary to
authorize the execution and delivery by it of this Agreement, and this
Agreement will be executed and delivered by one of its officers who is
duly authorized to execute and deliver this Agreement on its behalf.
(iii) Neither the execution nor 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 State 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 by-laws or any indenture, mortgage, contract,
agreement or instrument to which it is a party or by which any of its
properties may be bound.
(b) The Delaware Trustee hereby represents and warrants
to the Depositor, for the benefit of the Certificateholders, that:
36
42
(i) It is a banking corporation duly organized and validly
existing in good standing under the laws of the State of Delaware. It
has all requisite corporate power and authority to execute, deliver and
perform its obligations under this Agreement.
(ii) It has taken all corporate action necessary to
authorize the execution and delivery by it of this Agreement, and this
Agreement will be executed and delivered by one of its officers who is
duly authorized to execute and deliver this Agreement on its behalf.
(iii) Neither the execution nor 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 State law, governmental rule or
regulation governing the banking or trust powers of the Delaware
Trustee or any judgment or order binding on it, or constitute any
default under its charter documents or by-laws or any indenture,
mortgage, contract, agreement or instrument to which it is a party or
by which any of its properties may be bound.
SECTION 7.4. Reliance; Advice of Counsel. (a) The
Co-Trustees may rely upon, shall be protected in relying upon, and 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 Co-Trustees may accept a certified
copy of a resolution of the board of directors or other governing body of any
corporate party as conclusive evidence that such resolution has been duly
adopted by such body and that the same is in full force and effect. As to any
fact or matter the method of the determination of which is not specifically
prescribed herein, the Co-Trustees 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 Co-Trustees for any
action taken or omitted to be taken by it in good faith in reliance thereon.
37
43
(b) In the exercise or administration of the trusts
hereunder and in the performance of its duties and obligations under this
Agreement or the other Basic Documents, the Co-Trustees (i) may act directly or
through its agents or attorneys pursuant to agreements entered into with any of
them, and the Co-Trustees 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 Co-Trustees 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 Co-Trustees shall not be liable for anything done, suffered
or omitted in good faith by them in accordance with the written opinion or
advice of any such counsel, accountants or other such Persons and not contrary
to this Agreement or any other Basic Document.
SECTION 7.5. Not Acting in Individual Capacity. Except as
provided in this Article VII, in accepting the trusts hereby created, The Bank
of New York acts solely as Owner Trustee hereunder and The Bank of New York
(Delaware) acts solely as Delaware Trustee hereunder and not in their individual
capacities, and all Persons having any claim against the Co-Trustees by reason
of the transactions contemplated by this Agreement or any other Basic Document
shall look only to the Owner Trust Estate for payment or satisfaction thereof.
SECTION 7.6. Owner Trustee Not Liable for Certificates or
Receivables. The recitals contained herein and in the Certificates (other than
the signature and countersignature of the Owner Trustee on the Certificates)
shall be taken as the statements of the Depositor, and the Owner Trustee assumes
no responsibility for the correctness thereof. The Co- Trustees make no
representations as to the validity or sufficiency of this Agreement, of any
other Basic Document or of the Certificates (other than the signature and
countersignature of the Owner Trustee on the Certificates) or the Notes, or of
any Receivable or related documents. The Owner Trustee, the Delaware Trustee,
The Bank of New York and The Bank of New York (Delaware) 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
38
44
maintenance of any such perfection and priority, or for or with respect to the
sufficiency of the Owner Trust Estate 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 any intervening assignment; the completeness of any Receivable; the
performance or enforcement of any Receivable; the compliance by the Depositor or
the 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, the Administrator or the
Servicer or any subservicer taken in the name of the Owner Trustee or the
Delaware Trustee.
SECTION 7.7. Co-Trustees May Own Certificates and Notes.
The Bank of New York and The Bank of New York (Delaware), in their individual or
any other capacities, may become the owner or pledgee of Certificates or Notes
and may deal with the Depositor, the Servicer, the Administrator and the
Indenture Trustee in banking transactions with the same rights as they would
have if either of them were not the Owner Trustee or the Delaware Trustee.
ARTICLE VIII
COMPENSATION AND INDEMNITY OF OWNER TRUSTEE
SECTION 8.1. Owner Trustee's Fees and Expenses. The
Co-Trustees shall receive as compensation for their services hereunder such fees
as have been separately agreed upon before the date hereof between the Depositor
and the Co-Trustees, and the Co-Trustees shall be entitled to and reimbursed by
the Depositor for their other reasonable expenses hereunder, including the
reasonable compensation, expenses and disbursements of such agents,
representatives, experts and counsel as the Co-Trustees may employ in connection
with the exercise and performance of their rights and its duties hereunder. Such
amounts shall be treated for tax purposes as having
39
45
been contributed to the Trust by the Depositor and the tax deduction for such
amounts shall be allocated to the Depositor.
SECTION 8.2. Indemnification. The Depositor shall be
liable as prime obligor for, and shall indemnify the Co-Trustees, The Bank of
New York and The Bank of New York (Delaware) and their respective 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 Co- Trustees, The Bank of New York and The Bank of New York
(Delaware) or any Indemnified Party in any way relating to or arising out of
this Agreement, the other Basic Documents, the Owner Trust Estate, the
administration of the Owner Trust Estate or the action or inaction of the Owner
Trustee hereunder; provided that the Depositor shall not be liable for or
required to indemnify an Indemnified Party from and against Expenses arising or
resulting from (i) the Indemnified Party's own willful misconduct, bad faith or
negligence, or (ii) the inaccuracy of any representation or warranty contained
in Section 7.3 expressly made by the Indemnified Party. The indemnities
contained in this Section 8.2 shall survive the resignation or termination of
the Co-Trustees or the termination of this Agreement. In the event of any claim,
action or proceeding for which indemnity will be sought pursuant to this Section
8.2, the Co-Trustees' choice of legal counsel shall be subject to the approval
of the Depositor, which approval shall not be unreasonably withheld.
SECTION 8.3. Payments to Co-Trustees. Any amounts paid to
the Co-Trustees pursuant to this Article VIII shall be deemed not to be a part
of the Owner Trust Estate immediately after such payment.
40
46
ARTICLE IX
TERMINATION
SECTION 9.1. Termination of Trust Agreement. (a) This
Agreement (other than the provisions of Article VIII) shall terminate and be of
no further force or effect and the Trust shall wind up and dissolve, (i) upon
the maturity or other liquidation of the last remaining Receivable and the
disposition of any amounts received upon such maturity or liquidation, (ii) upon
the payment to the Noteholders and the Certificateholders of all amounts
required to be paid to them pursuant to the terms of the Indenture, the Sale and
Servicing Agreement and Article V or (iii) at the time provided in Section 9.2.
Any Insolvency Event, liquidation, dissolution, death or incapacity with respect
to any Certificateholder, other than the Depositor as described in Section 9.2,
shall not (x) operate to terminate this Agreement or the Trust, nor (y) 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 Owner Trust Estate nor (z) otherwise affect
the rights, obligations and liabilities of the parties hereto. Upon dissolution
of the Trust, the Owner Trustee shall wind up the business and affairs of the
Trust as required by Section 3808 of the Business Trust Statute.
(b) Except as provided in Section 9.1(a), neither the
Depositor nor any Certificateholder shall be entitled to revoke or terminate the
Trust.
(c) Notice of any termination of the Trust, specifying
the Distribution Date upon which the Certificateholders shall surrender their
Certificates to the Certificate Paying Agent for payment of the final
distribution and cancellation, shall be given by the Owner Trustee by letter to
Certificateholders mailed within five (5) Business Days of receipt of notice of
such termination from the Servicer, stating (i) the Distribution Date upon or
with respect to which final payment of the Certificates shall be made upon
presentation and surrender of the Certificates at the office of the Certificate
Paying Agent therein designated, (ii) the amount of any such final payment
(after reservation of sums sufficient to pay all claims and obligations, if
41
47
any, known to the Owner Trustee and payable by the Trust) 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 Certificates at
the office of the Certificate Paying Agent therein specified. The Owner Trustee
shall give such notice to the Certificate Registrar (if other than the Owner
Trustee) and the Certificate Paying Agent at the time such notice is given to
Certificateholders. Upon presentation and surrender of the Certificates, the
Certificate Paying Agent shall cause to be distributed to Certificateholders
amounts distributable on such Distribution Date pursuant to Section 5.2. Upon
the satisfaction and discharge of the Indenture, and receipt of a certificate
from the Indenture Trustee stating that all Noteholders have been paid in full
and that the Indenture Trustee is aware of no claims remaining against the Trust
in respect of the Indenture and the Notes, the Owner Trustee, in the absence of
actual knowledge of any other claim against the Trust, shall be deemed to have
made reasonable provision to pay all claims and obligations (including
conditional, contingent or unmatured obligations) for purposes of Section
3808(e) of the Business Trust Statute.
In the event that all of the Certificateholders shall not
surrender their Certificates for cancellation within six (6) 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 Certificates for cancellation and receive the final distribution with
respect thereto. If within one year after the second notice all the 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 Certificates and
the cost thereof shall be paid out of the funds and other assets that shall
remain subject to this Agreement. Subject to applicable escheat laws, any funds
remaining in the Trust after exhaustion of such remedies shall be distributed by
the Owner Trustee to the Depositor.
(d) Upon final distribution of any funds remaining in the
Trust, the Owner Trustee shall cause the Certificate of Trust to be cancelled by
filing a certifi-
42
48
cate of cancellation with the Secretary of State in accordance with the
provisions of Section 3810(c) of the Business Trust Statute.
SECTION 9.2. Dissolution upon Insolvency or Dissolution of
Depositor or General Partner. Notwithstanding the provisions of Section 3808 of
the Business Trust Statute, in the event that an Insolvency Event or a
dissolution shall occur with respect to the Depositor or the General Partner,
the Receivables shall be sold and this Agreement and the Trust shall be
terminated in accordance with Section 9.1 ninety (90) days after the date of
such Insolvency Event or the event giving rise to such dissolution, unless,
before the end of such 90-day period, the Owner Trustee shall have received
written instructions from (a) the Certificateholders (other than the Depositor)
of each Class of Certificates evidencing not less than a majority of the
Certificate Balance of each such Class and a majority of the right to receive
distributions in respect of interest on the Certificate Balance of each such
Class (including in each case the Certificate Balance of Certificates owned by
the Servicer and any of its Affiliates other than the Depositor), (b) the
Noteholders (other than the Depositor) of each Class of Notes evidencing not
less than a majority of the principal amount of each such Class and a majority
of the right to receive interest on the principal amount of each such Class
(including in each case the Notes owned by the Servicer and any of its
Affiliates other than the Depositor), and (c) holders of other interests, if any
(the existence of which interests the Administrator will have advised the Owner
Trustee in writing), in the Reserve Account (other than the Depositor) having
interests with a value not less than a majority of the value of all interests in
the Reserve Account (other than any such interests held by the Depositor), to
the effect that each such party disapproves of the liquidation of the
Receivables and termination of the Trust and in connection therewith the
Indenture Trustee (i) appoints an entity acceptable to Ford Credit to acquire an
interest in the Trust and to act as substitute "general partner" of the Trust
for federal income tax purposes and (ii) obtains an Opinion of Counsel that the
Trust will not thereafter be classified as an association (or publicly traded
partnership) taxable as a corporation for federal income tax and Applicable Tax
State purposes. Promptly after the occurrence of any Insolvency Event or
dissolution with respect
43
49
to the Depositor or the General Partner, (A) the Depositor shall give the
Indenture Trustee and the Owner Trustee written notice of such Insolvency Event,
(B) the Owner Trustee shall, upon the receipt of such written notice from the
Depositor, give prompt written notice to the Certificateholders, holders of
interests, if any, in the Reserve Account and the Indenture Trustee, of the
occurrence of such event, (C) the Indenture Trustee shall, upon receipt of
written notice of such Insolvency Event or dissolution from the Owner Trustee or
the Depositor, give prompt written notice to the Noteholders of the occurrence
of such event, and (D) the Owner Trustee shall, upon receipt of written
instructions from the applicable percentages of Noteholders, Certificateholders
and holders of interests, if any, in the Reserve Account disapproving of
liquidation and termination, give prompt written notice thereof to the Indenture
Trustee; provided, however, that any failure to give a notice required by this
sentence shall not prevent or delay, in any manner, a termination of the Trust
pursuant to the first sentence of this Section 9.2. Upon a termination pursuant
to this Section 9.2, the Owner Trustee shall direct the Indenture Trustee
promptly to sell the assets of the Trust (other than the Trust Accounts and each
Certificate Distribution Account) in a commercially reasonable manner and on
commercially reasonable terms. The proceeds of such a sale of the assets of the
Trust shall be treated as collections of Receivables under the Sale and
Servicing Agreement and deposited in the Collection Account and the Notes and
Certificates shall be paid in accordance with Section 4.6 of the Sale and
Servicing Agreement.
SECTION 9.3. Prepayment of Certificates. (a) The
Certificates shall be prepaid in whole, but not in part, at the direction of the
Servicer pursuant to Section 9.1 of the Sale and Servicing Agreement, on any
Distribution Date on which the Servicer exercises its option to purchase the
assets of the Trust pursuant to said Section 9.1, and the amount paid by the
Servicer shall be treated as collections of Receivables and applied to pay the
unpaid principal amount of the Notes and the Aggregate Certificate Balance plus
accrued and unpaid interest (including any overdue interest) thereon. The
Servicer shall furnish the Rating Agencies and the Owner Trustee notice of such
prepayment. If the Certificates are to be prepaid pursuant to this Section
9.3(a), the
44
50
Servicer shall furnish notice of such election to the Owner Trustee not later
than twenty (20) days prior to the Prepayment Date and the Trust shall deposit
by 10:00 A.M. (New York City time) on the Prepayment Date in the Certificate
Distribution Account the Prepayment Price of the Certificates to be redeemed,
whereupon all such Certificates shall be due and payable on the Prepayment Date.
(b) Notice of prepayment under Section 9.3(a) shall be
given by the Owner Trustee by first-class mail, postage prepaid, or by facsimile
mailed or transmitted immediately following receipt of notice from the Trust or
Servicer pursuant to Section 9.3(a), but not later than ten (10) days prior to
the applicable Prepayment Date, to each Certificateholder as of the close of
business on the Record Date preceding the applicable Prepayment Date, at such
Certificateholder's address or facsimile number appearing in the Certificate
Register.
All notices of prepayment shall state:
(i) the Prepayment Date;
(ii) the Prepayment Price; and
(iii) the place where such Certificates are to be
surrendered for payment of the Prepayment Price (which
shall be the office or agency of the Owner Trustee to be
maintained as provided in Section 3.9).
Notice of prepayment of the Certificates shall be given by the Owner Trustee in
the name and at the expense of the Trust. Failure to give notice of prepayment,
or any defect therein, to any Certificateholder shall not impair or affect the
validity of the prepayment of any other Certificate.
(c) Following notice of prepayment as required by Section
9.3(b), the Certificates shall on the Prepayment Date be paid by the Trust at
the Prepayment Price and (unless the Trust shall default in the payment of the
Prepayment Price) no interest shall accrue on the Prepayment Price for any
period after the date to which accrued interest is calculated for purposes of
calculating the Prepayment Price. Following payment in full of the
45
51
Prepayment Price, this Agreement and the Trust shall terminate.
ARTICLE X
SUCCESSOR OWNER TRUSTEES AND ADDITIONAL OWNER TRUSTEES
SECTION 10.1. Eligibility Requirements for Owner Trustee
and Delaware Trustee. (a) The Owner Trustee shall at all times (i) be authorized
to exercise corporate trust powers; (ii) have a combined capital and surplus of
at least $50,000,000 and shall be subject to supervision or examination by
federal or state authorities; and (iii) shall have (or shall have a parent that
has) a long-term debt rating of investment grade by each of the Rating Agencies
or be otherwise acceptable to the Rating Agencies. 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 10.1, 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 10.1, the Owner Trustee shall resign immediately in the manner and
with the effect specified in Section 10.2.
(b) The Delaware Trustee shall at all times be a
corporation satisfying the provisions of Section 3807(a) of the Business Trust
Statute.
SECTION 10.2. Resignation or Removal of Owner Trustee or
the Delaware Trustee. (a) The Owner Trustee or the Delaware Trustee may at any
time resign and be discharged from the trusts hereby created by giving written
notice thereof to the Administrator. Upon receiving such notice of resignation,
the Administrator shall promptly appoint a successor Owner Trustee or Delaware
Trustee, as applicable, by written instrument, in duplicate, one copy of which
instrument shall be delivered to the resigning Owner Trustee or Delaware Trustee
and one copy to the applicable successor Owner Trustee or Delaware Trustee. If
no successor Owner Trustee or Delaware Trustee shall have been so appointed
46
52
and have accepted appointment within thirty (30) days after the giving of such
notice of resignation, the resigning Owner Trustee or Delaware Trustee may
petition any court of competent jurisdiction for the appointment of a successor
Owner Trustee or Delaware 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 or Delaware Trustee from any obligations
otherwise imposed on it under the Basic Documents until such successor has in
fact assumed such appointment.
(b) If at any time the Owner Trustee or Delaware Trustee
shall cease to be eligible in accordance with the provisions of Section 10.1 or
a Co-Trustee resigns pursuant to Section 10.2 of this Agreement and the
ineligible or non-resigning Co-Trustee or either Co- Trustees shall fail to
resign after written request therefor by the Administrator, or if at any time
the Owner Trustee or Delaware Trustee shall be legally unable to act, or if at
any time an Insolvency Event with respect to the Owner Trustee or Delaware
Trustee shall have occurred and be continuing, then the Administrator may remove
the Co-Trustee that is insolvent or legally unable to act or may remove both
Co-Trustees. If the Administrator shall remove one or both of the Co-Trustees
under the authority of the immediately preceding sentence, the Administrator
shall promptly appoint a successor Co-Trustee or Co-Trustees, as applicable, by
written instrument, in duplicate, one copy of which instrument shall be
delivered to the outgoing Co-Trustee or Co-Trustees, as applicable, so removed
and one copy to the successor Co-Trustee or Co-Trustees, as applicable, and
shall pay all fees owed to the outgoing Co-Trustee or Co-Trustees, as
applicable.
(c) Any resignation or removal of a Co-Trustee and
appointment of a successor Co-Trustee or Co-Trustees pursuant to any of the
provisions of this Section 10.2 shall not become effective until acceptance of
appointment by the successor Co-Trustee or Co-Trustees pursuant to Section 10.3,
payment of all fees and expenses owed to the outgoing Co-Trustee or Co-Trustees
and the filing of a certificate of amendment to the Certificate of Trust if
required by the Business Trust Statute. The Administrator shall provide notice
of such resignation or removal of the Co-Trustee or Co-Trustees to the
47
53
Certificateholders, the Indenture Trustee, the Noteholders, any remaining
Co-Trustee and each of the Rating Agencies.
SECTION 10.3. Successor Owner Trustee or Delaware Trustee.
(a) Any successor Owner Trustee or Delaware Trustee appointed pursuant to
Section 10.2 shall execute, acknowledge and deliver to the Administrator and to
its predecessor Owner Trustee or Delaware Trustee an instrument accepting such
appointment under this Agreement. Upon the resignation or removal of the
predecessor Owner Trustee or Delaware Trustee becoming effective pursuant to
Section 10.2, such successor Owner Trustee or Delaware 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 or Delaware Trustee. The
predecessor Owner Trustee or Delaware Trustee shall, upon payment of its fees
and expenses, deliver to the successor Owner Trustee or Delaware Trustee all
documents and statements and monies held by it under this Agreement, and the
Administrator and the predecessor Owner Trustee or Delaware 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 or Delaware Trustee all such rights, powers, duties, and
obligations.
(b) No successor Owner Trustee or Delaware Trustee shall
accept appointment as provided in this Section 10.3 unless, at the time of such
acceptance, such successor Owner Trustee or Delaware Trustee shall be eligible
pursuant to Section 10.1.
(c) Upon acceptance of appointment by a successor Owner
Trustee or Delaware Trustee pursuant to this Section 10.3, the Administrator
shall mail notice of the successor of such Owner Trustee or Delaware Trustee to
all Certificateholders, the Indenture Trustee, the Noteholders, any remaining
Co-Trustee and the Rating Agencies. If the Administrator shall fail to mail such
notice within ten (10) days after acceptance of appointment by the successor
Owner Trustee or Delaware Trustee, the successor Owner Trustee or Delaware
Trustee shall cause such notice to be mailed at the expense of the
Administrator.
48
54
(d) Any successor Delaware Trustee appointed hereunder shall file the
amendments to the Certificate of Trust with the Secretary of State identifying
the name and principal place of business of such successor Delaware Trustee in
the State of Delaware.
SECTION 10.4. Merger or Consolidation of Owner Trustee or Delaware
Trustee. Any corporation into which the Owner Trustee or Delaware Trustee may be
merged or converted or with which it may be consolidated, or any corporation
resulting from any merger, conversion or consolidation to which the Owner
Trustee or Delaware Trustee shall be a party, or any corporation succeeding to
all or substantially all of the corporate trust business of the Owner Trustee or
Delaware Trustee, shall, 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, be the successor of the Owner Trustee or Delaware
Trustee hereunder; provided that such corporation shall be eligible pursuant to
Section 10.1; and provided further, that (i) the Owner Trustee or Delaware
Trustee shall mail notice of such merger or consolidation to the Rating Agencies
not less than fifteen (15) days prior to the effective date thereof and (ii) the
Delaware Trustee shall file an amendment to the Certificate of Trust as required
by Section 10.3.
SECTION 10.5. Appointment of Co-Trustee or Separate Trustee. (a)
Notwithstanding any other provisions of this Agreement, at any time, for the
purpose of meeting any legal requirements of any jurisdiction in which any part
of the Owner Trust Estate or any Financed Vehicle may at the time be located,
the Administrator and the Owner Trustee acting jointly shall have the power and
shall execute and deliver all instruments to appoint one or more Persons
approved by the Owner Trustee to act as co-trustee, jointly with the Owner
Trustee, or separate trustee or separate trustees, of all or any part of the
Trust, and to vest in such Person, in such capacity, such title to the Owner
Trust Estate, or any part thereof, and, subject to the other provisions of this
Section 10.5, such powers, duties, obligations, rights and trusts as the
Administrator and the Owner Trustee may consider necessary or desirable. If the
Administrator shall not have joined in such appointment within fifteen (15) days
after the receipt by it of a request so to do, the Owner
49
55
Trustee alone shall have the power to make such appointment. No co-trustee or
separate trustee under this Agreement shall be required to meet the terms of
eligibility as a successor trustee pursuant to Section 10.1 and no notice of the
appointment of any co-trustee or separate trustee shall be required pursuant to
Section 10.3.
(b) Each separate trustee and co-trustee shall, to the extent
permitted by law, be appointed and act subject to the following provisions and
conditions:
(i) all rights, powers, duties, and obligations conferred or imposed
upon the Owner Trustee shall be conferred upon and exercised or performed by
the Owner Trustee and such separate trustee or co-trustee jointly (it being
understood that such separate trustee or co-trustee is not authorized to act
separately without the Owner Trustee joining in such act), except to the
extent that under any law of any jurisdiction in which any particular act or
acts are to be performed, the Owner Trustee shall be incompetent or
unqualified to perform such act or acts, in which event such rights, powers,
duties, and obligations (including the holding of title to the Trust or any
portion thereof in any such jurisdiction) shall be exercised and performed
singly by such separate trustee or co-trustee, but solely at the direction
of the Owner Trustee;
(ii) no trustee under this Agreement shall be personally liable by
reason of any act or omission of any other trustee under this Agreement; and
(iii) the Administrator and the Owner Trustee acting jointly may at any
time accept the resignation of or remove any separate trustee or co-trustee.
(c) 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 X. Each separate trustee and co-trustee, upon its
acceptance of the trusts conferred, shall be vested with
50
56
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 and a copy thereof given to the Administrator.
(d) Any separate trustee or co-trustee may at any time appoint the
Owner Trustee as its agent or attorney-in-fact with full power and authority, to
the extent not prohibited by law, to do any lawful act under or in respect of
this Agreement on its behalf and in its name. If any separate trustee or
co-trustee shall die, become incapable of acting, resign or be removed, all of
its estates, properties, rights, remedies and trusts shall vest in and be
exercised by the Owner Trustee, to the extent permitted by law, without the
appointment of a new or successor trustee.
SECTION 10.6. Compliance with Business Trust Statute. Notwithstanding
anything herein to the contrary, the Trust shall at all times have at least one
trustee which meets the requirements of Section 3807(a) of the Business Trust
Statute.
ARTICLE XI
MISCELLANEOUS
SECTION 11.1. Supplements and Amendments. (a) This Agreement may be
amended by the Depositor and the Owner Trustee, with prior written notice to the
Rating Agencies, without the consent of any of the Noteholders or the
Certificateholders, to cure any ambiguity, to correct or supplement any
provisions in this Agreement inconsistent with any other provision of 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; provided,
however, that such action shall not, as evidenced by an Opinion of Counsel
satisfactory to the Owner Trustee and the Indenture Trustee, adversely affect in
any material respect the interests of any Noteholder or Certificateholder; and
provided further
51
57
that an Opinion of Counsel shall be furnished to the Indenture Trustee and the
Owner Trustee to the effect that such amendment (A) will not materially
adversely affect the federal or any Applicable Tax State income or franchise
taxation of any outstanding Note or Certificate, or any Noteholder or
Certificateholder and (B) will not cause the Trust to be taxable as a
corporation for federal or any Applicable Tax State income or franchise tax
purposes.
(b) This Agreement may also be amended from time to time by the
Depositor and the Owner Trustee, with prior written notice to the Rating
Agencies, with the consent of (i) the Noteholders of Notes evidencing not less
than a majority of the principal amount of the Notes Outstanding and (ii) the
Certificateholders of Certificates evidencing not less than a majority of the
Aggregate Certificate Balance, 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 (i) increase
or reduce in any manner the amount of, or accelerate or delay the timing of, or
change the allocation or priority of, collections of payments on Receivables or
distributions that are required to be made for the benefit of the Noteholders or
the Certificateholders, or (ii) reduce the aforesaid percentage of the principal
amount of the Notes Outstanding and the Aggregate Certificate Balance required
to consent to any such amendment, without the consent of all the Noteholders and
Certificateholders affected thereby; and provided further, that an Opinion of
Counsel shall be furnished to the Indenture Trustee and the Owner Trustee to the
effect that such amendment (A) will not materially adversely affect the federal
or any Applicable Tax State income or franchise taxation of any outstanding Note
or Certificate, or any Noteholder or Certificateholder and (B) will not cause
the Trust to be taxable as a corporation for federal or any Applicable Tax State
income or franchise tax purposes.
(c) 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
of the Rating Agencies.
52
58
(d) It shall not be necessary for the consent of Certificateholders,
the Noteholders or the Indenture Trustee pursuant to this Section 11.1 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 shall be subject to
such reasonable requirements as the Owner Trustee may prescribe.
(e) 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.
(f) Prior to the execution of any amendment to this Agreement 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. The Owner Trustee may, but shall not
be obligated to, enter into any such amendment which affects the Owner Trustee's
own rights, duties or immunities under this Agreement or otherwise.
(g) In connection with the execution of any amendment to this
Agreement or any amendment to any other agreement to which the Trust is a party,
the Owner Trustee shall be entitled to receive and conclusively rely upon an
Opinion of Counsel to the effect that such amendment is authorized or permitted
by the Basic Documents and that all conditions precedent in the Basic Documents
for the execution and delivery thereof by the Trust or the Owner Trustee, as the
case may be, have been satisfied.
SECTION 11.2. No Legal Title to Owner Trust Estate in
Certificateholders. The Certificateholders shall not have legal title to any
part of the Owner Trust Estate. The Certificateholders shall be entitled to
receive distributions with respect to their beneficial interests 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 beneficial interest in the Owner Trust
53
59
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 11.3. Limitation on Rights of Others. Except for Sections 2.7
and 11.1, the provisions of this Agreement are solely for the benefit of the
Owner Trustee, the Delaware Trustee, the Depositor, the Administrator, the
Certificateholders, the Servicer and, to the extent expressly provided herein,
the Indenture Trustee and the Noteholders, and nothing in this Agreement (other
than Section 2.7), 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 11.4. 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 (3) Business Days
after mailing if mailed by certified mail, postage prepaid (except that notice
to the Owner Trustee and the Delaware Trustee shall be deemed given only upon
actual receipt by the Owner Trustee and the Delaware Trustee, respectively), if
to the Owner Trustee or the Delaware Trustee, addressed to the respective
Corporate Trust Office; if to the Depositor, addressed to Ford Credit Auto
Receivables Two L.P. at the address of its principal executive office first
above written; or, as to each party, at such other address as shall be
designated by such party in a written notice to each other party.
(b) Any notice required or permitted to be given to 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 the
Certificateholder receives such notice.
SECTION 11.5. Severability. Any provision of this Agreement that is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or
54
60
unenforceability without invalidating the remaining provisions hereof, and any
such prohibition or unenforceability in any jurisdiction shall not invalidate or
render unenforceable such provision in any other jurisdiction.
SECTION 11.6. 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 11.7. Successors and Assigns. All covenants and agreements
contained herein shall be binding upon, and inure to the benefit of, the
Depositor, 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 11.8. No Petition. The Owner Trustee (not in its individual
capacity but solely as Owner Trustee), by entering into this Agreement, and each
Certificateholder, by accepting a Certificate, hereby covenants and agrees that
it will not, until after the Notes have been paid in full, institute against the
Depositor, the General Partner or the Trust, or join in any institution against
the Depositor, the General Partner 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 Certificates, the Notes, this
Agreement or any of the other Basic Documents.
SECTION 11.9. No Recourse. Each Certificateholder, by accepting a
Certificate, acknowledges that such Certificateholder's Certificates represent
beneficial interests in the Trust only and do not represent interests in or
obligations of the Depositor, the General Partner, the Servicer, the
Administrator, the Owner Trustee, the Indenture Trustee or any Affiliate
thereof, and no recourse may be had against such parties or their assets, except
as may be expressly set forth or
55
61
contemplated in this Agreement, the Certificates or the other Basic Documents.
SECTION 11.10. Headings. The headings of the various Articles and
Sections herein are for convenience of reference only and shall not define or
limit any of the terms or provisions hereof.
SECTION 11.11. Governing Law. This Agreement shall be construed in
accordance with the laws of the State of Delaware and the obligations, rights
and remedies of the parties hereunder shall be determined in accordance with
such laws.
SECTION 11.12. Sale and Servicing Agreement Obligations.
Notwithstanding any other provision of this Agreement, the Owner Trustee agrees
that it will comply with its obligations under Sections 3.1, 4.1 and 4.2 of the
Sale and Servicing Agreement.
56
62
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed by their respective officers hereunto duly authorized, as of the
day and year first above written.
FORD CREDIT AUTO RECEIVABLES
TWO L.P., as Depositor
By: FORD CREDIT AUTO RECEIVABLES
TWO, INC.,
as General Partner
By: /s/ X. X. Xxxxxx
---------------------------------------
Name: X. X. Xxxxxx
Title: Assistant Secretary
THE BANK OF NEW YORK (DELAWARE),
as Delaware Trustee
By: /s/ Xxxxxx X. Laser
---------------------------------------
Name: Xxxxxx X. Laser
Title: Assistant Vice President
THE BANK OF NEW YORK,
as Owner Trustee
By: /s/ Xxxxx X. Xxxxxx
---------------------------------------
Name: Xxxxx X. Xxxxxx
Title: Assistant Treasurer
63
EXHIBIT A
FORM OF CLASS C CERTIFICATE
NUMBER $62,650,000
R-[ ] CUSIP NO. 00000XXX0
THE PRINCIPAL OF THIS CERTIFICATE IS DISTRIBUTABLE AS SET FORTH IN THE TRUST
AGREEMENT. ACCORDINGLY, THE OUTSTANDING PRINCIPAL BALANCE OF THIS CERTIFICATE AT
ANY TIME MAY BE LESS THAN THE AMOUNT SHOWN ON THE FACE HEREOF.
FORD CREDIT AUTO OWNER TRUST 1999-D
CLASS C 7.21% ASSET BACKED CERTIFICATE
evidencing a beneficial interest in the property of the Trust, as defined below,
which property includes a pool of motor vehicle retail installment sale
contracts, secured by security interests in the motor vehicles financed thereby,
conveyed to Ford Credit Auto Receivables Two L.P. by Ford Motor Credit Company
and conveyed by Ford Credit Auto Receivables Two L.P. to the Trust. The property
of the Trust has been pledged to the Indenture Trustee pursuant to the Indenture
to secure the payment of the Notes issued thereunder.
(This Certificate does not represent an interest in or obligation of Ford Motor
Credit Company, Ford Credit Auto Receivables Two L.P. or any of their respective
Affiliates, except to the extent described below.)
THIS CERTIFIES THAT is the registered owner of
DOLLARS nonassessable, fully-paid, beneficial interest in Class C Certificates
of Ford Credit Auto Owner Trust 1999-D (the "Trust") formed by Ford Credit Auto
Receivables Two L.P., a Delaware limited partnership (the "Depositor"). The
Class C Certificates have an aggregate Initial Certificate Balance of
$62,650,000 and bear interest at a rate of 7.21% per annum (the "Class C Rate").
A-1
64
The Trust was created pursuant to an Amended and Restated Trust
Agreement, dated as of September 1, 1999 (as from time to time amended,
supplemented or otherwise modified and in effect, the "Trust Agreement"), among
the Depositor, The Bank of New York (Delaware), not in its individual capacity
but solely as Delaware trustee (the "Delaware Trustee") and The Bank of New
York, not in its individual capacity but solely 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.
This Certificate is one of the duly authorized Certificates designated
as "Class C 7.21% Asset Backed Certificates" (herein called the "Class C
Certificates") which, together with the Certificates designated as "Class D
8.00% Asset Backed Certificates" (the "Class D Certificates" and, together with
the Class C Certificates, the "Certificates") are issued under and are subject
to the terms, provisions and conditions of the Trust Agreement, to which Trust
Agreement the Certificateholder of this Certificate by virtue of the acceptance
hereof assents and by which such Certificateholder is bound. Also issued under
the Indenture, dated as of September 1, 1999 (as from time to time amended,
supplemented or otherwise modified and in effect, the "Indenture"), between the
Trust and The Chase Manhattan Bank, as indenture trustee (in such capacity, the
"Indenture Trustee"), are the Notes designated as "Class A-1 5.411% Asset Backed
Notes", "Class A-2 5.816% Asset Backed Notes", "Class A-3 6.20% Asset Backed
Notes", "Class A-4 6.40% Asset Backed Notes", "Class A-5 6.52% Asset Backed
Notes" and "Class B 6.87% Asset Backed Notes" (collectively, the "Notes"). The
property of the Trust includes (i) a pool of motor vehicle retail installment
sale contracts for new and used automobiles and light trucks and certain rights
and obligations thereunder (the "Receivables"); (ii) with respect to Actuarial
Receivables, all monies due thereunder on or after the Cutoff Date and, with
respect to Simple Interest Receivables, all monies due or received thereunder on
or after the Cutoff Date; (iii) the security interests in the Financed Vehicles
granted by Obligors pursuant to the Receivables and any other interest of the
Trust in the Financed Vehicles; (iv) rights to proceeds from claims on
A-2
65
certain physical damage, credit life, credit disability or other insurance
policies, if any, covering Financed Vehicles or Obligors; (v) Dealer Recourse;
(vi) all of the Seller's rights to the Receivable Files; (vii) such amounts as
from time to time may be held in one or more accounts maintained pursuant to the
Sale and Servicing Agreement, dated as of September 1, 1999 (as from time to
time amended, supplemented or otherwise modified and in effect, the "Sale and
Servicing Agreement"), by and among the Trust, the Depositor, as seller (in such
capacity, the "Seller"), and Ford Motor Credit Company, as servicer (the
"Servicer"), including the Reserve Account; (viii) the Seller's rights under the
Sale and Servicing Agreement; (ix) the Seller's rights under the Purchase
Agreement; (x) payments and proceeds with respect to the Receivables held by the
Servicer; (xi) all property (including the right to receive Liquidation
Proceeds) securing a Receivable (other than a Receivable repurchased by the
Servicer or purchased by the Seller); (xii) rebates of premiums and other
amounts relating to insurance policies and other items financed under the
Receivables in effect as of the Cutoff Date; and (xiii) any and all proceeds of
the foregoing. THE RIGHTS OF THE TRUST IN THE FOREGOING PROPERTY OF THE TRUST
HAVE BEEN PLEDGED TO THE INDENTURE TRUSTEE TO SECURE THE PAYMENT OF THE NOTES.
Under the Trust Agreement, there will be distributed on the fifteenth
day of each month, or if such fifteenth day is not a Business Day, the next
Business Day (each, a "Distribution Date"), commencing October 15, 1999, to the
Person in whose name this Certificate is registered at the close of business on
the last day of the preceding month (the "Record Date") such Certificateholder's
percentage interest in the amount to be distributed to Class C
Certificateholders on such Distribution Date; provided, however, that principal
will be distributed to the Class C Certificateholders on each Distribution Date
on (to the extent of funds remaining after all classes of the Notes have been
paid in full) and after the date on which all classes of the Notes have been
paid in full. Notwithstanding the foregoing, following the occurrence and during
the continuation of an event of default under the Indenture which has resulted
in an acceleration of the Notes or following certain events of insolvency or a
dissolution with respect to the
A-3
66
Depositor or the General Partner, no distributions of principal or interest will
be made on the Certificates until all principal and interest on the Notes has
been paid in full.
THE HOLDER OF THIS CERTIFICATE ACKNOWLEDGES AND AGREES THAT ITS RIGHTS
TO RECEIVE DISTRIBUTIONS IN RESPECT OF THIS CERTIFICATE ARE SUBORDINATED TO THE
RIGHTS OF THE NOTEHOLDERS AS DESCRIBED IN THE SALE AND SERVICING AGREEMENT, THE
INDENTURE AND THE TRUST AGREEMENT.
It is the intent of the Depositor, the Servicer and the
Certificateholders that, for purposes of federal income, state and local
franchise and income tax and any other income taxes, the Trust will be treated
as a partnership and the Certificateholders (including the Depositor) will be
treated as partners in that partnership. The Depositor and the other
Certificateholders by acceptance of a Certificate agree to treat, and to take no
action inconsistent with the treatment of, the Certificates for such tax
purposes as partnership interests in the Trust.
Each Certificateholder, by its acceptance of a Certificate, covenants
and agrees that such Certificateholder will not, until after the Notes have been
paid in full, institute against the Depositor, the General Partner or the Trust,
or join in any institution against the Depositor, the General Partner 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
Notes, the Certificates, the Trust Agreement or any of the other Basic
Documents.
Distributions on this Certificate will be made as provided in the Trust
Agreement by the Owner Trustee or the Certificate Paying Agent by wire transfer
or check mailed to the Certificateholder of record in the Certificate Register
without the presentation or surrender of this Certificate or the making of any
notation hereon. Except as otherwise provided in the Trust Agreement and
notwithstanding the above, the final distribution on this Certificate will be
made after due notice by the Owner Trustee of the pendency of such distribution
and only
A-4
67
upon presentation and surrender of this Certificate at the office or agency
maintained for the purpose by the Owner Trustee in New York, New York.
Reference is hereby made to the further provisions of this Certificate
set forth on the reverse hereof, which further provisions shall for all purposes
have the same effect as if set forth at this place.
Unless the certificate of authentication hereon shall have been
executed by an authorized officer of the Owner Trustee, by manual signature,
this Certificate shall not entitle the Certificateholder hereof to any benefit
under the Trust Agreement or the Sale and Servicing Agreement or be valid for
any purpose.
This Certificate shall be construed in accordance with the laws of the
State of Delaware and the obligations, rights and remedies of the parties
hereunder shall be determined in accordance with such laws.
A-5
68
In WITNESS WHEREOF, the Owner Trustee, on behalf of the Trust and not
in its individual capacity, has caused this Class C Certificate to be duly
executed.
FORD CREDIT AUTO OWNER
TRUST 1999-D
By: THE BANK OF NEW YORK,
not in its individual
capacity but solely as
Owner Trustee
By:
---------------------------------
Authorized Officer
OWNER TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Class C Certificates referred to in the within-mentioned
Trust Agreement.
Dated: September 23, 0000
XXX XXXX XX XXX XXXX,
not in its individual capacity
but solely as Owner Trustee
By:
---------------------------------
Authorized Officer
69
[REVERSE OF CERTIFICATE]
The Certificates do not represent an obligation of, or an interest in,
the Depositor, the General Partner, the Servicer, the Administrator, the Owner
Trustee or any Affiliates of any of them and no recourse may be had against such
parties or their assets, except as may be expressly set forth or contemplated
herein, in the Trust Agreement or in the other Basic Documents. In addition,
this Certificate is not guaranteed by any governmental agency or instrumentality
and is limited in right of payment to certain collections with respect to the
Receivables (and certain other amounts), all as more specifically set forth
herein and in the Sale and Servicing Agreement. A registration statement, which
includes a form of the Trust Agreement as an exhibit thereto, has been filed
with the Securities and Exchange Commission with respect to the Class A-3 Notes,
the Class A-4 Notes, the Class A-5 Notes, the Class B Notes and the Class C
Certificates.
The Trust Agreement permits, with certain exceptions therein provided,
the amendment thereof and the modification of the rights and obligations of the
Depositor and the rights of the Certificateholders under the Trust Agreement at
any time by the Depositor and the Owner Trustee with the consent of the
Noteholders and the Certificateholders evidencing not less than a majority of
the principal amount of the Notes Outstanding and the Aggregate Certificate
Balance, respectively. Any such consent by the Certificateholder of this
Certificate shall be conclusive and binding on such Certificateholder and on all
future Certificateholders of this Certificate and of any Certificate issued upon
the registration of Transfer hereof or in exchange herefor or in lieu hereof
whether or not notation of such consent is made upon this Certificate. The Trust
Agreement also permits the amendment thereof, in certain limited circumstances,
without the consent of any of the Certificateholders.
As provided in the Trust Agreement and subject to certain limitations
therein set forth, the Transfer of the Certificates are registrable in the
Certificate Register upon surrender of this Certificate for registration of
Transfer at the offices or agencies maintained by The Bank of New York
(Delaware) in its capacity as Cer-
A-7
70
tificate Registrar, or by any successor Certificate Registrar, in New York, New
York, 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 Certificates of authorized denominations evidencing the same
aggregate interest in the Trust will be issued to the designated transferee.
The Certificates are issuable as registered Certificates without
coupons in denominations of at least $20,000 and in integral multiples of $1,000
in excess thereof. Certificates are exchangeable for new Certificates of like
Class and 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 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
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 Class C Certificates may be acquired only by an entity that is
either: (a) not, and each account (if any) for which it is purchasing the Class
C Certificates is not (i) an employee benefit plan (as defined in Section 3(3)
of the Employee Retirement Income Security Act of 1974, as amended ("ERISA"))
that is subject to Title I of ERISA, (ii) a plan described in Section 4975(e)(1)
of the Internal Revenue Code of 1986, as amended (the "Code") that is subject to
Section 4975 of the Code, (iii) 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, (iv) 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
A-8
71
C.F.R. ss. 2510.3-101 or otherwise under ERISA) or (v) a person investing "plan
assets" of any such plan (including without limitation, for purposes of this
clause (v), an insurance company general account, but excluding any entity
registered under the Investment Company Act of 1940, as amended); or (b) an
insurance company acting on behalf of a general account and (i) on the date of
purchase less than 25% of the assets of such general account (as reasonably
determined by it) constitute "plan assets" for purposes of Title I of ERISA and
Section 4975 of the Code, (ii) the purchase and holding of such Class C
Certificates are eligible for exemptive relief under Sections (I) and (III) of
Prohibited Transaction Class Exemption 95-60, and (iii) the purchaser agrees
that if, after the purchaser's initial acquisition of the Class C Certificates,
at any time during any calendar quarter 25% or more of the assets of such
general account (as reasonably determined by it no less frequently than each
calendar quarter) constitute "plan assets" for purposes of Title I of ERISA or
Section 4975 of the Code and no exemption or exception from the prohibited
transaction rules applies to the continued holding of the Class C Certificates
under Section 401(c) of ERISA and the final regulations thereunder or under an
exemption or regulation issued by the United States Department of Labor under
ERISA, it will dispose of all Class C Certificates then held in its general
account by the end of the next following calendar quarter.
In addition, the Certificates may not be acquired by or on behalf of a
Person other than (A) a citizen or resident of the United States, (B) a
corporation or partnership organized in or under the laws of the United States
or any political subdivision thereof, (C) an estate the income of which is
includible in gross income for United States tax purposes, regardless of its
source, (D) a trust if a U.S. court is able to exercise primary supervision over
the administration of such trust and one or more Persons meeting the conditions
of this paragraph has the authority to control all substantial decisions of the
trust or (E) a Person not described in clauses (A) through (D) above whose
ownership of the Certificates is effectively connected with such Person's
conduct of a trade or business within the United States (within the meaning of
the Code) and who provides the Owner Trustee and the Depositor with an IRS Form
4224 (and such other certifications, representations, or
A-9
72
opinions of counsel as may be requested by the Owner Trustee or the Depositor).
The obligations and responsibilities created by the Trust Agreement and
the Trust created thereby shall terminate (i) upon the maturity or other
liquidation of the last remaining Receivable and the disposition of any amounts
received upon such maturity or liquidation or (ii) upon the payment to the
Noteholders and the Certificateholders of all amounts required to be paid to
them pursuant to the Indenture, the Trust Agreement and the Sale and Servicing
Agreement, and upon such termination any remaining assets of the Trust shall be
distributed to the Depositor. The Servicer of the Receivables may at its option
purchase the assets of the Trust 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 Notes and the Certificates; however, such
right of purchase is exercisable only as of the last day of any Collection
Period as of which the Pool Balance is less than or equal to 10% of the Initial
Pool Balance.
A-10
73
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 Certificate, and all rights thereunder, hereby irrevocably
constituting and appointing
Attorney to transfer said 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 as it
appears upon the face of the within Certificate in every particular, without
alteration, enlargement or any change whatever. Such signature must be
guaranteed by a member firm of the New York Stock Exchange or a commercial bank
or trust company.
X-00
00
XXXXXXX X
FORM OF CLASS D CERTIFICATE
NUMBER $62,650,000
R-[ ] Private Placement
THIS CERTIFICATE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR UNDER ANY STATE SECURITIES OR
BLUE SKY LAW OF ANY STATE OF THE UNITED STATES. THE HOLDER HEREOF, BY PURCHASING
THIS CERTIFICATE, AGREES FOR THE BENEFIT OF THE TRUST AND THE DEPOSITOR THAT
THIS CERTIFICATE MAY BE REOFFERED, RESOLD, PLEDGED OR OTHERWISE TRANSFERRED ONLY
IN COMPLIANCE WITH THE SECURITIES ACT AND OTHER APPLICABLE LAWS, AND ONLY (1)
PURSUANT TO RULE 144A UNDER THE SECURITIES ACT ("RULE 144A") TO A PERSON THAT
THE HOLDER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER, WITHIN THE
MEANING OF RULE 144A (A "QIB"), PURCHASING FOR ITS OWN ACCOUNT OR FOR THE
ACCOUNT OF A QIB, WHOM THE HOLDER HAS INFORMED, IN EACH CASE, THAT THE REOFFER,
RESALE, PLEDGE, OR OTHER TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A,
SUBJECT TO (A) THE RECEIPT BY THE TRUST AND THE CERTIFICATE REGISTRAR OF A
CERTIFICATE SUBSTANTIALLY IN THE FORM ATTACHED AS EXHIBIT F TO THE TRUST
AGREEMENT AND (B) THE RECEIPT BY THE TRUST AND THE CERTIFICATE REGISTRAR OF A
LETTER SUBSTANTIALLY IN THE FORM ATTACHED AS EXHIBIT D TO THE TRUST AGREEMENT,
(2) PURSUANT TO AN EXEMPTION FROM REGISTRATION PROVIDED BY RULE 144 UNDER THE
SECURITIES ACT (IF AVAILABLE), SUBJECT TO THE RECEIPT BY THE TRUST, THE INITIAL
PURCHASER AND THE CERTIFICATE REGISTRAR OF SUCH EVIDENCE ACCEPTABLE TO THE TRUST
AND THE INITIAL PURCHASER THAT SUCH REOFFER, RESALE, PLEDGE OR TRANSFER IS IN
COMPLIANCE WITH THE TRUST AGREEMENT AND THE SECURITIES ACT AND OTHER APPLICABLE
LAWS, (3) TO AN INSTITUTIONAL "ACCREDITED INVESTOR" WITHIN THE MEANING THEREOF
IN RULE 501(a)(1), (2), (3) OR (7) OF REGULATION D UNDER THE SECURITIES ACT
PURSUANT TO ANY OTHER EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE
SECURITIES ACT, SUBJECT TO (A) THE RECEIPT BY THE TRUST AND THE CERTIFICATE
REGISTRAR OF A LETTER SUBSTANTIALLY IN THE FORM ATTACHED AS EXHIBIT E TO THE
TRUST AGREEMENT OR (B) THE RECEIPT BY THE TRUST, THE INITIAL PURCHASER AND THE
CERTIFICATE REGISTRAR OF SUCH OTHER EVIDENCE ACCEPTABLE TO THE TRUST AND THE
INITIAL PURCHASER THAT SUCH REOFFER, RESALE, PLEDGE OR TRANSFER IS IN COMPLIANCE
WITH THE TRUST AGREEMENT AND THE SECURITIES ACT AND OTHER APPLICABLE LAWS, OR
(4) TO THE
B-1
75
DEPOSITOR, IN EACH CASE IN ACCORDANCE WITH ALL APPLICABLE SECURITIES LAWS OF THE
UNITED STATES AND SECURITIES AND BLUE SKY LAWS OF THE STATES OF THE UNITED
STATES.
THE PRINCIPAL OF THIS CERTIFICATE IS DISTRIBUTABLE AS SET FORTH IN THE TRUST
AGREEMENT. ACCORDINGLY, THE OUTSTANDING PRINCIPAL BALANCE OF THIS CERTIFICATE AT
ANY TIME MAY BE LESS THAN THE AMOUNT SHOWN ON THE FACE HEREOF.
FORD CREDIT AUTO OWNER TRUST 1999-D
CLASS D 8.00% ASSET BACKED CERTIFICATE
evidencing a beneficial interest in the property of the Trust, as defined below,
which property includes a pool of motor vehicle retail installment sale
contracts, secured by security interests in the motor vehicles financed thereby,
conveyed to Ford Credit Auto Receivables Two L.P. by Ford Motor Credit Company
and conveyed by Ford Credit Auto Receivables Two L.P. to the Trust. The property
of the Trust has been pledged to the Indenture Trustee pursuant to the Indenture
to secure the payment of the Notes issued thereunder.
(This Certificate does not represent an interest in or obligation of Ford Motor
Credit Company, Ford Credit Auto Receivables Two L.P. or any of their respective
Affiliates, except to the extent described below.)
THIS CERTIFIES THAT is the registered owner of
DOLLARS nonassessable, fully-paid, beneficial interest in Class D Certificates
of Ford Credit Auto Owner Trust 1999-D (the "Trust") formed by Ford Credit Auto
Receivables Two L.P., a Delaware limited partnership (the "Depositor"). The
Class D Certificates have an aggregate Initial Certificate Balance of
$62,650,000 and bear interest at a rate of 8.00% per annum (the "Class D Rate").
B-2
76
The Trust was created pursuant to an Amended and Restated Trust
Agreement, dated as of September 1, 1999 (as from time to time amended,
supplemented or otherwise modified and in effect, the "Trust Agreement"), among
the Depositor, The Bank of New York (Delaware), not in its individual capacity
but solely as Delaware trustee (the "Delaware Trustee") and The Bank of New
York, not in its individual capacity but solely 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.
This Certificate is one of the duly authorized Certificates designated
as "Class D 8.00% Asset Backed Certificates" (herein called the "Class D
Certificates") which, together with the Certificates designated as "Class C
7.21% Asset Backed Certificates" (the "Class C Certificates" and, together with
the Class D Certificates, the "Certificates") are issued under and are subject
to the terms, provisions and conditions of the Trust Agreement, to which Trust
Agreement the Certificateholder of this Certificate by virtue of the acceptance
hereof assents and by which such Certificateholder is bound. Also issued under
the Indenture, dated as of September 1, 1999 (as from time to time amended,
supplemented or otherwise modified and in effect, the "Indenture"), between the
Trust and The Chase Manhattan Bank, as indenture trustee (in such capacity, the
"Indenture Trustee"), are the Notes designated as "Class A-1 5.411% Asset Backed
Notes", "Class A-2 5.816% Asset Backed Notes", "Class A-3 6.20% Asset Backed
Notes", "Class A-4 6.40% Asset Backed Notes", "Class A-5 6.52% Asset Backed
Notes" and "Class B 6.87% Asset Backed Notes" (collectively, the "Notes"). The
property of the Trust includes (i) a pool of motor vehicle retail installment
sale contracts for new and used automobiles and light trucks and certain rights
and obligations thereunder (the "Receivables"); (ii) with respect to Actuarial
Receivables, all monies due thereunder on or after the Cutoff Date and, with
respect to Simple Interest Receivables, all monies due or received thereunder on
or after the Cutoff Date; (iii) the security interests in the Financed Vehicles
granted by Obligors pursuant to the Receivables and any other interest of the
Trust in the Financed Vehicles; (iv) rights to proceeds from claims on certain
physical damage, credit life, credit disability or other insurance policies, if
any, covering Financed Vehicles or Obligors; (v) Dealer Recourse; (vi) all of
the Seller's rights to the Receivable Files; (vii) such amounts as from time to
time may be held
B-3
77
in one or more accounts maintained pursuant to the Sale and Servicing Agreement,
dated as of September 1, 1999 (as from time to time amended, supplemented or
otherwise modified and in effect, the "Sale and Servicing Agreement"), by and
among the Trust, the Depositor, as seller (in such capacity, the "Seller"), and
Ford Motor Credit Company, as servicer (the "Servicer"), including the Reserve
Account; (viii) the Seller's rights under the Sale and Servicing Agreement; (ix)
the Seller's rights under the Purchase Agreement; (x) payments and proceeds with
respect to the Receivables held by the Servicer; (xi) all property (including
the right to receive Liquidation Proceeds) securing a Receivable (other than a
Receivable repurchased by the Servicer or purchased by the Seller); (xii)
rebates of premiums and other amounts relating to insurance policies and other
items financed under the Receivables in effect as of the Cutoff Date; and (xiii)
any and all proceeds of the foregoing. THE RIGHTS OF THE TRUST IN THE FOREGOING
PROPERTY OF THE TRUST HAVE BEEN PLEDGED TO THE INDENTURE TRUSTEE TO SECURE THE
PAYMENT OF THE NOTES.
Under the Trust Agreement, there will be distributed on the fifteenth
day of each month, or if such fifteenth day is not a Business Day, the next
Business Day (each, a "Distribution Date"), commencing October 15, 1999, to the
Person in whose name this Certificate is registered at the close of business on
the last day of the preceding month (the "Record Date") such Certificateholder's
percentage interest in the amount to be distributed to Class D
Certificateholders on such Distribution Date; provided, however, that principal
will be distributed to the Class D Certificateholders on each Distribution Date
on (to the extent of funds remaining after all classes of the Notes and the
Class C Certificates have been paid in full) and after the date on which all
classes of the Notes and the Class C Certificates have been paid in full.
Notwithstanding the foregoing, following the occurrence and during the
continuation of an event of default under the Indenture which has resulted in an
acceleration of the Notes or following certain events of insolvency or a
dissolution with respect to the Depositor or the General Partner, no
distributions of principal or interest will be made on the Certificates until
all principal and interest on the Notes has been paid in full.
B-4
78
THE HOLDER OF THIS CERTIFICATE ACKNOWLEDGES AND AGREES THAT ITS RIGHTS
TO RECEIVE DISTRIBUTIONS IN RESPECT OF THIS CERTIFICATE ARE SUBORDINATED TO THE
RIGHTS OF THE NOTEHOLDERS AND THE CLASS C CERTIFICATEHOLDERS AS DESCRIBED IN THE
SALE AND SERVICING AGREEMENT, THE INDENTURE AND THE TRUST AGREEMENT.
It is the intent of the Depositor, the Servicer and the
Certificateholders that, for purposes of federal income, state and local
franchise and income tax and any other income taxes, the Trust will be treated
as a partnership and the Certificateholders (including the Depositor) will be
treated as partners in that partnership. The Depositor and the other
Certificateholders by acceptance of a Certificate agree to treat, and to take no
action inconsistent with the treatment of, the Certificates for such tax
purposes as partnership interests in the Trust.
Each Certificateholder, by its acceptance of a Certificate, covenants
and agrees that such Certificateholder will not, until after the Notes have been
paid in full, institute against the Depositor, the General Partner or the Trust,
or join in any institution against the Depositor, the General Partner 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
Notes, the Certificates, the Trust Agreement or any of the other Basic
Documents.
Distributions on this Certificate will be made as provided in the Trust
Agreement by the Owner Trustee or the Certificate Paying Agent by wire transfer
or check mailed to the Certificateholder of record in the Certificate Register
without the presentation or surrender of this Certificate or the making of any
notation hereon. Except as otherwise provided in the Trust Agreement and
notwithstanding the above, the final distribution on this Certificate will be
made after due notice by the Owner Trustee of the pendency of such distribution
and only upon presentation and surrender of this Certificate at the office or
agency maintained for the purpose by the Owner Trustee in New York, New York.
Reference is hereby made to the further provisions of this Certificate
set forth on the reverse hereof,
B-5
79
which further provisions shall for all purposes have the same effect as if set
forth at this place.
Unless the certificate of authentication hereon shall have been
executed by an authorized officer of the Owner Trustee, by manual signature,
this Certificate shall not entitle the Certificateholder hereof to any benefit
under the Trust Agreement or the Sale and Servicing Agreement or be valid for
any purpose.
This Certificate shall be construed in accordance with the laws of the
State of Delaware and the obligations, rights and remedies of the parties
hereunder shall be determined in accordance with such laws.
B-6
80
In WITNESS WHEREOF, the Owner Trustee, on behalf of the Trust and not
in its individual capacity, has caused this Class D Certificate to be duly
executed.
FORD CREDIT AUTO OWNER
TRUST 1999-D
By: THE BANK OF NEW YORK,
not in its individual
capacity but solely as
Owner Trustee
By:
--------------------------------
Authorized Officer
OWNER TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Class D Certificates referred to in the
within-mentioned Trust Agreement.
Dated: September 23, 0000
XXX XXXX XX XXX XXXX,
not in its individual capacity
but solely as Owner Trustee
By:
--------------------------------
Authorized Officer
81
[REVERSE OF CERTIFICATE]
The Certificates do not represent an obligation of, or an interest in,
the Depositor, the General Partner, the Servicer, the Administrator, the Owner
Trustee or any Affiliates of any of them and no recourse may be had against such
parties or their assets, except as may be expressly set forth or contemplated
herein, in the Trust Agreement or in the other Basic Documents. In addition,
this Certificate is not guaranteed by any governmental agency or instrumentality
and is limited in right of payment to certain collections with respect to the
Receivables (and certain other amounts), all as more specifically set forth
herein and in the Sale and Servicing Agreement. A registration statement, which
includes a form of the Trust Agreement as an exhibit thereto, has been filed
with the Securities and Exchange Commission with respect to the Class A-3 Notes,
the Class A-4 Notes, the Class A-5 Notes, the Class B Notes and the Class C
Certificates.
The Trust Agreement permits, with certain exceptions therein provided,
the amendment thereof and the modification of the rights and obligations of the
Depositor and the rights of the Certificateholders under the Trust Agreement at
any time by the Depositor and the Owner Trustee with the consent of the
Noteholders and the Certificateholders evidencing not less than a majority of
the principal amount of the Notes Outstanding and the Aggregate Certificate
Balance, respectively. Any such consent by the Certificateholder of this
Certificate shall be conclusive and binding on such Certificateholder and on all
future Certificateholders of this Certificate and of any Certificate issued upon
the registration of Transfer hereof or in exchange herefor or in lieu hereof
whether or not notation of such consent is made upon this Certificate. The Trust
Agreement also permits the amendment thereof, in certain limited circumstances,
without the consent of any of the Certificateholders.
As provided in the Trust Agreement and subject to certain limitations
therein set forth, the Transfer of the Certificates are registrable in the
Certificate Register upon surrender of this Certificate for registration of
Transfer at the offices or agencies maintained by The Bank of New York
(Delaware) in its capacity as Certificate Registrar, or by any successor
Certificate Registrar, in New York, New York, accompanied by a written
instrument of transfer in form satisfactory to the Owner Trustee and the
B-8
82
Certificate Registrar duly executed by the holder hereof or such holder's
attorney duly authorized in writing, and thereupon one or more new Certificates
of authorized denominations evidencing the same aggregate interest in the Trust
will be issued to the designated transferee.
The Certificates are issuable as registered Certificates without
coupons in denominations of at least $20,000 and in integral multiples of $1,000
in excess thereof. Certificates are exchangeable for new Certificates of like
Class and 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 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
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 Class D Certificates may not be acquired by or on behalf of (A) an
employee benefit plan, as defined in Section 3(3) of ERISA, that is subject to
Title I of ERISA, (B) a plan described in Section 4975(e)(1) of the Code that is
subject to Section 4975 of the Code, (C) 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, (D) 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. ss. 2510.3-101 or otherwise under ERISA) or (E) a
person investing "plan assets" of any such plan (including without limitation,
for purposes of this clause (E), an insurance company general account, but
excluding any entity registered under the Investment Company Act of 1940, as
amended).
In addition, the Certificates may not be acquired by or on behalf of a
Person other than (A) a citizen or resident of the United States, (B) a
corporation or partnership organized in or under the laws of the United States
or any political subdivision thereof, (C) an estate the income of which is
includible in gross income for
X-0
00
Xxxxxx Xxxxxx tax purposes, regardless of its source, (D) a trust if a U.S.
court is able to exercise primary supervision over the administration of such
trust and one or more Persons meeting the conditions of this paragraph has the
authority to control all substantial decisions of the trust or (E) a Person not
described in clauses (A) through (D) above whose ownership of the Certificates
is effectively connected with such Person's conduct of a trade or business
within the United States (within the meaning of the Code) and who provides the
Owner Trustee and the Depositor with an IRS Form 4224 (and such other
certifications, representations, or opinions of counsel as may be requested by
the Owner Trustee or the Depositor).
The obligations and responsibilities created by the Trust Agreement and
the Trust created thereby shall terminate (i) upon the maturity or other
liquidation of the last remaining Receivable and the disposition of any amounts
received upon such maturity or liquidation or (ii) upon the payment to the
Noteholders and the Certificateholders of all amounts required to be paid to
them pursuant to the Indenture, the Trust Agreement and the Sale and Servicing
Agreement, and upon such termination any remaining assets of the Trust shall be
distributed to the Depositor. The Servicer of the Receivables may at its option
purchase the assets of the Trust 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 Notes and the Certificates; however, such
right of purchase is exercisable only as of the last day of any Collection
Period as of which the Pool Balance is less than or equal to 10% of the Initial
Pool Balance.
B-10
84
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 Certificate, and all rights thereunder, hereby irrevocably
constituting and appointing
Attorney to transfer said 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 as it
appears upon the face of the within Certificate in every particular, without
alteration, enlargement or any change whatever. Such signature must be
guaranteed by a member firm of the New York Stock Exchange or a commercial bank
or trust company.
B-11
85
EXHIBIT C
FORM OF INVESTMENT LETTER - CLASS C CERTIFICATES
[Date]
Ford Credit Auto Owner Trust 1999-D,
as Issuer
The Bank of New York,
as Owner Trustee and
as Certificate Registrar
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
In connection with our proposed purchase of the Class C 7.21% Asset
Backed Certificates (the "Certificates") of Ford Credit Auto Owner Trust 1999-D
(the "Issuer"), a trust formed by Ford Credit Auto Receivables Two L.P. (the
"Depositor" or "Seller"), we confirm that:
1. We are either:
(a) not, and each account (if any) for which we are purchasing the
Certificates is not (i) an employee benefit plan (as defined in
Section 3(3) of the Employee Retirement Income Security Act of
1974, as amended ("ERISA")) that is subject to Title I of ERISA,
(ii) a plan described in Section 4975(e)(1) of the Internal
Revenue Code of 1986, as amended (the "Code") that is subject to
Section 4975 of the Code, (iii) 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, (iv) 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 (v) a person investing "plan assets" of any such plan
(including without limitation, for purposes of this clause (v), an
insurance company general account, but excluding an entity
registered under the Investment Company Act of 1940, as amended),
or
(b) an insurance company acting on behalf of a general account and
(i) on the date hereof less than 25% of the assets of such general
account
C-1
86
(as reasonably determined by us) constitute "plan assets" for
purposes of Title I of ERISA and Section 4975 of the Code, (ii)
the purchase and holding of such Certificates are eligible for
exemptive relief under Sections (I) and (III) of Prohibited
Transaction Class Exemption 95-60, and (iii) the undersigned
agrees that if, after the undersigned's initial acquisition of the
Certificates, at any time during any calendar quarter 25% or more
of the assets of such general account (as reasonably determined by
us no less frequently than each calendar quarter) constitute "plan
assets" for purposes of Title I of ERISA or Section 4975 of the
Code and no exemption or exception from the prohibited transaction
rules applies to the continued holding of the Certificates under
Section 401(c) of ERISA and the final regulations thereunder or
under an exemption or regulation issued by the DOL under ERISA, we
will dispose of all Certificates then held in our general account
by the end of the next following calendar quarter.
2. We are, and each account (if any) for which we are purchasing
the Certificates is, a person who is (A) a citizen or resident of the United
States, (B) a corporation or partnership organized in or under the laws of the
United States or any political subdivision thereof, (C) an estate the income of
which is includible in gross income for United States tax purposes, regardless
of its source, (D) a trust if a U.S. court is able to exercise primary
supervision over the administration of such trust and one or more Persons
meeting the conditions of clause (A), (B), (C) or (E) of this paragraph 2 has
the authority to control all substantial decisions of the trust or (E) a Person
not described in clauses (A) through (D) above whose ownership of the
Certificates is effectively connected with such Person's conduct of a trade or
business within the United States (within the meaning of the Code) and who
provides the Issuer and the Depositor with an IRS Form 4224 (and such other
certifications, representations, or opinions of counsel as may be requested by
the Issuer or the Depositor).
3. We understand that any purported resale, transfer,
assignment, participation, pledge, or other disposal of (any such act, a
"Transfer") of any Certificate (or any interest therein) to any person who does
not meet the conditions of paragraphs 1 and 2 above shall be null and void
(each, a "Void Transfer"), and the purported transferee in a Void Transfer shall
not be recognized by
C-2
87
the Issuer or any other person as a Certificateholder for any purpose.
4. We agree that if we determine to Transfer any of the
Certificates we will cause our proposed transferee to provide to the Issuer and
the Certificate Registrar a letter substantially in the form of this letter.
You are entitled to rely upon this letter and are irrevocably
authorized to produce this letter or a copy hereof to any interested party in
any administrative or legal proceedings or official inquiry with respect to the
matters covered hereby.
Very truly yours,
By:
------------------------------
Name:
Title:
Securities To Be Purchased:
$ principal balance of Certificates
Annex A attached hereto lists the name of the account and principal balance of
Certificates purchased for each account (if any) for which we are purchasing
Certificates.
C-3
88
EXHIBIT D
FORM OF INVESTMENT LETTER - CLASS D CERTIFICATES
QUALIFIED INSTITUTIONAL BUYER
[Date]
Ford Credit Auto Owner Trust 1999-D
as Issuer
The Bank of New York
as Owner Trustee and
Certificate Registrar
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Re: Ford Credit Auto Owner Trust 1999-D
Class D 8.00% Asset Backed Certificates
Ladies and Gentlemen:
In connection with our proposed purchase of the Class D 8.00%
Asset Backed Certificates (the "Certificates") of Ford Credit Auto Owner Trust
1999-_D (the "Issuer"), a trust formed by Ford Credit Auto Receivables Two L.P.
(the "Depositor"), we confirm that:
1. The undersigned agrees to be bound by, and not to resell,
transfer, assign, participate, pledge or otherwise dispose of (any such act,
a "Transfer") the Certificates except in compliance with, the restrictions
and conditions set forth in the legend on the face of the Class D
Certificates and under the Securities Act of 1933, as amended (the
"Securities Act").
2. We understand that no subsequent Transfer of the Certificates
is permitted unless we cause our proposed transferee to provide to the
Issuer, the Certificate Registrar and the Initial Purchaser a letter
substantially in the form of this letter or Exhibit E to the Trust
Agreement, as applicable, or such other written statement as the Depositor
shall prescribe.
3. We are a "qualified institutional buyer" (within the meaning
of Rule 144A under the Securities Act (a "QIB") and we are acquiring the
Certificates for our own account or for a single account (which is a QIB) as
to which we exercise sole investment discretion.
D-1
89
4. We are not, and each account (if any) for which we are
purchasing the Certificates is not, (A) an employee benefit plan (as defined
in Section 3(3) of the Employee Retirement Income Security Act of 1974, as
amended ("ERISA")) that is subject to Title I of ERISA, (B) a plan described
in Section 4975(e)(1) of the Internal Revenue Code of 1986, as amended (the
"Code") that is subject to Section 4975 of the Code, (C) 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, (D) 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 (E) a person investing "plan
assets" of any such plan (including without limitation, for purposes of this
clause (E), an insurance company general account, but excluding any entity
registered under the Investment Company Act of 1940, as amended).
5. We are a person who is (i) a citizen or resident of the
United States, (ii) a corporation or partnership organized in or under the
laws of the United States or any political subdivision thereof, (iii) an
estate the income of which is includible in gross income for United States
tax purposes, regardless of its source, (iv) a trust if a U.S. court is able
to exercise primary supervision over the administration of such trust and
one or more persons described in clauses (i) to (iii) above or clause (v)
below has the authority to control all substantial decisions of the trust or
(v) a person not described in clauses (i) to (iv) above whose ownership of
the Certificates is effectively connected with such person's conduct of a
trade or business within the United States (within the meaning of the Code)
and who provides the Issuer and the Depositor with a Form 4224 (and such
other certifications, representations, or opinions of counsel as may be
requested by the Issuer or the Depositor).
6. We understand that any purported Transfer of any Certificate
(or any interest therein) in contravention of the restrictions and
conditions above will be null and void (each, a "Void Transfer"), and the
purported transferee in a Void Transfer will not be recognized by the Issuer
or any other person as a Certificateholder for any purpose.
You are entitled to rely upon this letter and are irrevocably authorized to
produce this letter or a copy
D-2
90
hereof to any interested party in any administrative or legal proceedings or
official inquiry with respect to the matters covered hereby.
Very truly yours,
By:
------------------------------
Name:
Title:
Securities To Be Purchased:
$ principal amount of Certificates
D-3
91
EXHIBIT E
FORM OF INVESTMENT LETTER - CLASS D CERTIFICATES
INSTITUTIONAL ACCREDITED INVESTOR
[Date]
Ford Credit Auto Owner Trust 1999-D
as Issuer
The Bank of New York
as Owner Trustee and
Certificate Registrar
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Re: Ford Credit Auto Owner Trust 1999-D
Class D 8.00% Asset Backed Certificates
Ladies and Gentlemen:
In connection with our proposed purchase of the Class D 8.00% Asset
Backed Certificates (the "Certificates") of Ford Credit Auto Owner Trust 1999-D
(the "Issuer"), a trust formed by Ford Credit Auto Receivables Two L.P. (the
"Depositor"), we confirm that:
1. The undersigned agrees to be bound by, and not to resell,
transfer, assign, participate, pledge or otherwise dispose of (any such act,
a "Transfer") the Certificates except in compliance with, the restrictions
and conditions set forth in the legend on the face of the Class D
Certificates and under the Securities Act of 1933, as amended (the
"Securities Act").
2. We understand that no subsequent Transfer of the Certificates is
permitted unless we cause our proposed transferee to provide to the Issuer,
the Certificate Registrar and the Initial Purchaser a letter substantially
in the form of this letter or Exhibit D to the Trust Agreement, as
applicable, or such other written statement as the Depositor shall
prescribe.
3. We are a "qualified institutional buyer" (within the meaning of
Rule 144A under the Securities Act (a "QIB") and we are acquiring the
Certificates
E-1
92
for our own account or for a single account (which is a QIB) as to which we
exercise sole investment discretion.
4. We are not, and each account (if any) for which we are purchasing
the Certificates is not, (A) an employee benefit plan (as defined in Section
3(3) of the Employee Retirement Income Security Act of 1974, as amended
("ERISA")) that is subject to Title I of ERISA, (B) a plan described in
Section 4975(e)(1) of the Internal Revenue Code of 1986, as amended (the
"Code") that is subject to Section 4975 of the Code, (C) 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, (D) 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 (E) a person investing "plan
assets" of any such plan (including without limitation, for purposes of this
clause (E), an insurance company general account, but excluding any entity
registered under the Investment Company Act of 1940, as amended).
5. We are a person who is (i) a citizen or resident of the United
States, (ii) a corporation or partnership organized in or under the laws of
the United States or any political subdivision thereof, (iii) an estate the
income of which is includible in gross income for United States tax
purposes, regardless of its source, (iv) a trust if a U.S. court is able to
exercise primary supervision over the administration of such trust and one
or more persons described in clauses (i) to (iii) above or clause (v) below
has the authority to control all substantial decisions of the trust or (v) a
person not described in clauses (i) to (iv) above whose ownership of the
Certificates is effectively connected with such person's conduct of a trade
or business within the United States (within the meaning of the Code) and
who provides the Issuer and the Depositor with a Form 4224 (and such other
certifications, representations, or opinions of counsel as may be requested
by the Issuer or the Depositor).
6. We understand that any purported Transfer of any Certificate (or
any interest therein) in contravention of the restrictions and conditions
above will be null and void (each, a "Void Transfer"), and the purported
transferee in a Void Transfer will not be
E-2
93
recognized by the Issuer or any other person as a Certificateholder for any
purpose.
You are entitled to rely upon this letter and are irrevocably authorized to
produce this letter or a copy hereof to any interested party in any
administrative or legal proceedings or official inquiry with respect to the
matters covered hereby.
Very truly yours,
By:
------------------------------
Name:
Title:
Securities To Be Purchased:
$ principal amount of Certificates
X-0
00
XXXXXXX X
FORM OF RULE 144A TRANSFEROR CERTIFICATE -
CLASS D CERTIFICATES
[Date]
The Bank of New York
as Owner Trustee and
Certificate Registrar
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Re: Ford Credit Auto Owner Trust 1999-D
Class D 8.00% Asset Backed Certificates
Ladies and Gentlemen:
This is to notify you as to the transfer of $ [*] in denomination of
Class D 8.00% Asset Backed Certificates (the "Certificates") of Ford Credit Auto
Owner Trust 1999-D (the "Issuer").
The undersigned is the holder of the Certificates and with this notice
hereby deposits with the Owner Trustee $ [*] in denomination of Certificates and
requests that Certificates of the same class in the same aggregate denomination
be issued, executed and authenticated and registered to the purchaser on
, 199[ ], as specified in the Trust Agreement dated as of September 1,
1999 relating to the Certificates, as follows:
Name: Denominations:
Address:
Taxpayer I.D. No:
The undersigned represents and warrants that the undersigned (i)
reasonably believes the purchaser is a "qualified institutional buyer," as
defined in Rule 144A under the Securities Act of 1933 (the "Act"), (ii) such
purchaser has acquired the Certificates in a transaction effected in accordance
with the exemption from the registration requirements of the Act provided by
Rule 144A, (iii) if the purchaser has purchased the Certificates for
F-1
95
an account for which it is acting as fiduciary or agent, such account is a
qualified institutional buyer and (iv) the purchaser is acquiring Certificates
for its own account or for an institutional account for which it is acting as
fiduciary or agent.
Very truly yours,
[NAME OF HOLDER OF
CERTIFICATES]
By:
----------------------------
Name:
Title:
[*] authorized denomination
F-2
96
EXHIBIT G
FORM OF CERTIFICATE OF TRUST
CERTIFICATE OF TRUST OF
FORD CREDIT AUTO OWNER TRUST 1999-D
This Certificate of Trust of Ford Credit Auto Owner Trust 1999-D
(the "Trust"), dated as of September 1, 1999, is being duly executed and filed
by The Bank of New York (Delaware), a Delaware banking corporation, as Delaware
trustee (the "Delaware Trustee") and The Bank of New York, a New York banking
corporation, as owner trustee (the "Owner Trustee"), to form a business trust
under the Delaware Business Trust Act (12 Delaware Code, ss. 3801 et seq.) (the
"Act").
1. Name. The name of the business trust formed hereby is Ford
Credit Auto Owner Trust 1999-D.
2. Delaware Trustee. The name and business address of the
trustee of the Trust in the State of Delaware is The Bank of New York
(Delaware), Xxxxx Xxxx Xxxxxx, Xxxxx 000, Xxxxxx, Xxxxxxxx 00000.
3. Effective Date. This Certificate of Trust shall be effective
upon filing.
IN WITNESS WHEREOF, the undersigned, being the sole trustees of
the Trust, have executed this Certificate of Trust as of the date first above
written in accordance with Section 3811(a)(1) of the Act.
THE BANK OF NEW YORK, not in its
individual capacity but solely as
Owner Trustee under a Trust Agreement
dated as of September 1, 1999
By:
-------------------------------
Name:
Title:
THE BANK OF NEW YORK (DELAWARE), not
in its individual capacity but solely
as Delaware Trustee under a Trust
Agreement dated as of September 1, 1999
By:
-------------------------------
Name:
Title:
G-1
97
APPENDIX A
Definitions and Usage
SEE TAB NO. 12
