EXHIBIT 4.1
[AMENDED AND RESTATED]
TRUST AGREEMENT
between
HOUSEHOLD AUTO RECEIVABLES CORPORATION
and
[NAME OF OWNER TRUSTEE]
Owner Trustee
Dated as of _______________
TABLE OF CONTENTS
Page
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ARTICLE I Definitions...............................................................1
Section 1.1. Capitalized Terms..................................................1
Section 1.2. Other Definitional Provisions......................................2
Section 1.3. Action by or Consent of Noteholders and Certificateholders.........3
Section 1.4. Material Adverse Effect............................................3
ARTICLE II Organization.............................................................4
Section 2.1. Name...............................................................4
Section 2.2. Office.............................................................4
Section 2.3. Purposes and Powers................................................4
Section 2.4. Appointment of Owner Trustee.......................................5
Section 2.5. Initial Capital Contribution of Trust Estate.......................5
Section 2.6. Declaration of Trust...............................................5
Section 2.7. Liability..........................................................5
Section 2.8. Title to Trust Property............................................6
Section 2.9. Situs of Trust.....................................................6
Section 2.10. Representations and Warranties of the Depositor....................6
Section 2.11. Federal Income Tax Allocations.....................................8
Section 2.12. Covenants of the Depositor.........................................8
Section 2.13. Covenants of the Certificateholders................................9
Section 2.14. Representations and Covenants of the Certificate
Majority and the Owner Trustee With Respect to the Trust........10
ARTICLE III Certificates and Transfer of Interests.................................11
Section 3.1. Initial Ownership.................................................11
Section 3.2. The Certificates..................................................11
Section 3.3. Authentication of Certificates....................................13
Section 3.4. Registration of Transfer and Exchange of Certificates.............13
Section 3.5. Mutilated, Destroyed, Lost or Stolen Certificates.................14
Section 3.6. Persons Deemed Certificateholders.................................14
Section 3.7. Access to List of Certificateholders' Names and Addresses.........15
Section 3.8. Maintenance of Office or Agency...................................15
Section 3.9. ERISA Restrictions................................................15
Section 3.10. Securities Matters................................................15
Section 3.11. Distributions.....................................................16
Section 3.12. Paying Agent......................................................16
ARTICLE IV Voting Rights and Other Actions.........................................16
Section 4.1. Prior Notice to Holders with Respect to Certain Matters...........16
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Section 4.2. Action by Certificateholders with Respect to Certain Matters......17
Section 4.3. Action by Certificateholders with Respect to Bankruptcy...........17
Section 4.4. Restrictions on Certificateholders' Power.........................17
Section 4.5. Majority Control..................................................18
ARTICLE V Certain Duties...........................................................18
Section 5.1. Accounting and Records to the Noteholders,
Certificateholders, the Internal Revenue Service and Others.....18
Section 5.2. Signature on Returns; Tax Matters Partner.........................19
ARTICLE VI Authority and Duties of Owner Trustee...................................19
Section 6.1. General Authority.................................................19
Section 6.2. General Duties....................................................19
Section 6.3. Action upon Instruction...........................................20
Section 6.4. No Duties Except as Specified in this Agreement or in
Instructions....................................................21
Section 6.5. No Action Except under Specified Documents or Instructions........21
Section 6.6. Restrictions......................................................21
ARTICLE VII Concerning the Owner Trustee...........................................22
Section 7.1. Acceptance of Trusts and Duties...................................22
Section 7.2. Furnishing of Documents...........................................23
Section 7.3. Representations and Warranties....................................23
Section 7.4. Reliance; Advice of Counsel.......................................24
Section 7.5. Not Acting in Individual Capacity.................................24
Section 7.6. Owner Trustee Not Liable for Certificates or Receivables..........25
Section 7.7. Owner Trustee May Own Certificates and Notes......................25
Section 7.8. Payments from Owner Trust Estate..................................25
Section 7.9. Doing Business in Other Jurisdictions.............................26
ARTICLE VIII Compensation of Owner Trustee.........................................26
Section 8.1. Owner Trustee's Fees and Expenses.................................26
Section 8.2. Indemnification...................................................26
Section 8.3. Payments to the Owner Trustee.....................................27
Section 8.4. Non-recourse Obligations..........................................27
ARTICLE IX Termination of Agreement................................................27
Section 9.1. Termination of Agreement..........................................27
ARTICLE X Successor Owner Trustees and Additional Owner Trustees...................29
Section 10.1. Eligibility Requirements for Owner Trustee........................29
Section 10.2. Resignation or Removal of Owner Trustee...........................29
(ii)
Section 10.3. Successor Owner Trustee...........................................30
Section 10.4. Merger or Consolidation of Owner Trustee..........................30
Section 10.5. Appointment of Co-Trustee or Separate Trustee.....................31
ARTICLE XI Miscellaneous...........................................................32
Section 11.1. Supplements and Amendments........................................32
Section 11.2. No Legal Title to Owner Trust Estate in Certificateholders........33
Section 11.3. Limitations on Rights of Others...................................33
Section 11.4. Notices...........................................................33
Section 11.5. Severability......................................................34
Section 11.6. Separate Counterparts.............................................34
Section 11.7. Assignments; Series Support Provider..............................34
Section 11.8. Covenants of the Depositor........................................34
Section 11.9. No Petition.......................................................34
Section 11.10. No Recourse.......................................................35
Section 11.11. Headings..........................................................35
Section 11.12. GOVERNING LAW.....................................................35
Section 11.13. Master Servicer...................................................35
EXHIBITS
Exhibit A Form of Certificate
Exhibit B Form of Certificate of Trust
(iii)
THIS [AMENDED AND RESTATED] TRUST AGREEMENT, dated as of
_______________, between HOUSEHOLD AUTO RECEIVABLES CORPORATION, a Nevada
corporation (the "Depositor"), and [NAME OF OWNER TRUSTEE], a Delaware banking
corporation, as Owner Trustee (the "Owner Trustee") [amends and restates in its
entirety that certain Trust Agreement, dated as of _____________, between the
Depositor and the Owner Trustee].
ARTICLE I
Definitions
Section 1.1. Capitalized Terms. For all purposes of this Agreement,
the following terms shall have the meanings set forth below:
"Agreement" shall mean this Amended and Restated Agreement, as the
same may be amended and supplemented from time to time.
"Benefit Plan" shall have the meaning assigned to such term in ss.
3.9.
"Business Trust Statute" shall mean Chapter 38 of Title 12 of the
Delaware Code, 12 Del. Code ss. 3801 et seq. as the same may be amended from
time to time.
"Certificates" means, if the Depositor elects (i) to evidence its
interest in certificated form pursuant to Section 3.2, the certificate
substantially in the form of Exhibit A or (ii) to have its interest be
uncertified pursuant to Section 3.2, such uncertificated interest.
"Certificate Majority" shall have the meaning assigned to such term
in Section 4.1.
"Certificate Paying Agent" means [Name of Certificate Paying Agent].
"Certificate Register" and "Certificate Registrar" shall mean the
register mentioned and the registrar appointed pursuant to ss. 3.4.
"Certificate of Trust" shall mean the Certificate of Trust in the
form of Exhibit B to be filed for the Trust pursuant to ss. 3810(a) of the
Business Trust Statute.
"Code" shall mean the Internal Revenue Code of 1986, as amended.
"Corporate Trust Office" shall mean, with respect to the Owner
Trustee, the principal corporate trust office of the Owner Trustee located at
[address], Attention: ____________________, or at such other address as the
Owner Trustee may designate by notice to the Certificateholders and the
Depositor, or the principal corporate trust office of any successor Owner
Trustee (the address of which the successor owner trustee will notify the
Certificateholders and the Depositor).
"Depositor" shall mean Household Auto Receivables Corporation in its
capacity as Depositor hereunder.
"ERISA" shall have the meaning assigned to such term in ss. 3.9.
"Expenses" shall have the meaning assigned to such term in ss. 8.2.
"Holder" or "Certificateholder" shall mean a Person in whose name a
Certificate is registered on the Certificate Register.
"Household" shall mean Household Finance Corporation.
"Indemnified Parties" shall have the meaning assigned to such term
in ss. 8.2.
"Owner Trust Estate" shall mean all right, title and interest of the
Trust in and to the property and rights assigned to the Trust pursuant to
Article II of the Master Sale and Servicing Agreement, all funds on deposit from
time to time in the Trust Accounts and all other property of the Trust from time
to time, including any rights of the Owner Trustee and the Trust pursuant to the
Master Sale and Servicing Agreement, each Basic Document and each Series Related
Document.
"Owner Trustee" shall mean [Name of Owner Trustee], a Delaware
banking corporation, not in its individual capacity but solely as owner trustee
under this Agreement, and any successor Owner Trustee hereunder.
"Percentage Interest" shall mean, with respect to a Certificate, the
portion of the interests in the Trust represented by a Certificate, as reflected
in the Certificate Register.
"Secretary of State" shall mean the Secretary of State of the State
of Delaware.
"Securities Act" shall have the meaning assigned to such term in
Section 3.4.
"Series Trust Estate" shall mean the property granted to the Owner
Trustee on behalf of the Trust pursuant to Section 1.02 of the Series ______
Supplement.
"Treasury Regulations" shall mean regulations, including proposed or
temporary regulations, promulgated under the Code. References herein to specific
provisions of proposed or temporary regulations shall include analogous
provisions of final Treasury Regulations or other successor Treasury
Regulations.
"Trust" shall mean the trust established by this Agreement.
Section 1.2. Other Definitional Provisions. (a) Capitalized
terms used herein and not otherwise defined have the meanings assigned to them
in the Master Sale
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and Servicing Agreement or, if not defined therein, in the Indenture, provided
that, as used herein, Series means only the Series of Notes and Series of
Certificates with respect to which the Trust is the Issuer and only such Series
Trust Estates included in the Owner Trust Estate.
(b) All terms defined in this Agreement shall have the defined
meanings when used in any Certificate or other document made or delivered
pursuant hereto unless otherwise defined therein.
(c) As used in this Agreement and in any Certificate or other
document made or delivered pursuant hereto or thereto, accounting terms not
defined in this Agreement or in any such certificate or other document, and
accounting terms partly defined in this Agreement or in any such certificate or
other document to the extent not defined, shall have the respective meanings
given to them under generally accepted accounting principles as in effect on the
date of this Agreement or any such certificate or other document, as applicable.
To the extent that the definitions of accounting terms in this Agreement or in
any such certificate or other document are inconsistent with the meanings of
such terms under generally accepted accounting principles, the definitions
contained in this Agreement or in any such certificate or other document shall
control.
(d) The words "hereof," "herein," "hereunder" and words of similar
import when used in this Agreement shall refer to this Agreement as a whole and
not to any particular provision of this Agreement; Section and Exhibit
references contained in this Agreement are references to Sections and Exhibits
in or to this Agreement unless otherwise specified; and the term "including"
shall mean "including without limitation."
(e) The definitions contained in this Agreement are applicable to
the singular as well as the plural forms of such terms and to the masculine as
well as to the feminine and neuter genders of such terms.
Section 1.3. Action by or Consent of Noteholders and
Certificateholders. Whenever any provision of this Agreement refers to action
to be taken, or consented to, by Noteholders or Certificateholders, such
provision shall be deemed to refer to the Certificateholder or Noteholder, as
the case may be, of record as of the Record Date immediately preceding the date
on which such action is to be taken, or consent given, by Noteholders or
Certificateholders. Solely for the purposes of any action to be taken, or
consented to, by Noteholders, any Note registered in the name of the Depositor
or any Affiliate thereof shall be deemed not to be outstanding; provided,
however, that, solely for the purpose of determining whether the Indenture
Trustee is entitled to rely upon any such action or consent, only Notes which
the Owner Trustee or the Indenture Trustee knows to be so owned shall be so
disregarded.
Section 1.4. Material Adverse Effect. Whenever a determination is to
be made under this Agreement as to whether a given event, action, course of
conduct or set of facts or circumstances could or would have a material adverse
effect on the Noteholders or Certificateholders (or any similar or analogous
determination), such
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determination shall be made without taking into account the funds available from
claims under any policy or other Series Support.
ARTICLE II
Organization
Section 2.1. Name. There is hereby formed a trust to be known as
"Household Automotive Trust ______", in which name the Owner Trustee may conduct
the business of the Trust, make and execute contracts and other instruments on
behalf of the Trust and xxx and be sued.
Section 2.2. Office. The office of the Trust shall be in care of the
Owner Trustee at the Corporate Trust Office or at such other address 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 each Series
Supplement and the Certificates pursuant to this Agreement and each Series
Supplement, and to sell the Notes;
(ii) with the proceeds of the sale of the Notes, to fund the expense
of obtaining any Series Support and to pay the organizational, start-up
and transactional expenses of the Trust and to pay the balance to the
Depositor pursuant to the Master Sale and Servicing Agreement;
(iii) with respect to each Series Trust Estate, to assign, grant,
transfer, pledge, mortgage and convey each Series Trust Estate to the
Indenture Trustee pursuant to the Indenture and the related Series
Supplement for the benefit of the Noteholders;
(iv) to enter into and perform its obligations under the Basic
Documents and the Series Related Documents with respect to each Series, in
each case, to which it is a party;
(v) to acquire, hold and manage the Owner Trust Estate;
(vi) to make distributions on the Certificates in accordance with
their respective terms;
(vii) to own Class SV Preferred Stock of the Depositor;
(viii) 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
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(ix) subject to compliance with the Basic Documents and the Series
Related Documents with respect to each Series, 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 Certificateholders and
the Noteholders.
(b) 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, the Basic Documents or any Series Related 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. Initial Capital Contribution of Trust Estate. The
Depositor hereby sells, assigns, transfers, conveys and sets over to the Owner
Trustee, on behalf of the Trust, as of the date hereof, the sum of $1,000 and
one share of Class SV Preferred Stock of the Depositor. The Owner Trustee hereby
acknowledges receipt in trust from the Depositor, as of the date hereof, of the
foregoing contribution, which shall constitute the initial Owner Trust Estate.
The Depositor shall pay organizational expenses of the Trust as they may arise.
Section 2.6. 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, on behalf of the Trust, for the use and benefit of
the Certificateholders, subject to the obligations of the Trust under the Basic
Documents and the Series Related Documents with respect to each Series. It is
the intention of the parties hereto that the Trust constitute a business trust
under the Business Trust Statute and that this Agreement constitute the
governing instrument of such business trust. It is the intention of the parties
hereto that, solely for income and franchise tax purposes, the Trust shall be
treated as a branch; provided, however, that in the event Certificates are owned
by more than one Certificateholder, it is the intention of the parties hereto
that, solely for income and franchise tax purposes, the Trust shall then be
treated as a partnership and that, unless otherwise required by appropriate tax
authorities, only after such time 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 all rights, powers and
duties set forth herein and to the extent not inconsistent herewith, in the
Business Trust Statute with respect to accomplishing the purposes of the Trust.
The Owner Trustee shall file the Certificate of Trust with the Secretary of
State.
Section 2.7. Liability. (a) The Depositor shall pay
organizational expenses of the Trust as they may arise or shall, upon the
request of the Owner Trustee, promptly reimburse the Owner Trustee for any such
expenses paid by the Owner Trustee.
(b) No Holder, other than to the extent set forth in clause (a),
shall have any personal liability for any liability or obligation of the Trust.
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Section 2.8. Title to Trust Property. (a) Legal title to all 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.
(b) The holders of the Certificates shall not have legal title to
any part of the related Series Trust Estate. The Holders of the Certificates
shall be entitled to receive distributions with respect to their undivided
ownership interest therein in accordance with the terms hereof and the related
Series Supplement. No transfer, by operation of law or otherwise, of any right,
title or interest by any Certificateholder of its ownership interest in the
Owner Trust Estate shall operate to terminate this Agreement or the trusts
hereunder or entitle any transferee to an accounting or to the transfer to it of
legal title to any part of any Series Trust Estate.
Section 2.9. Situs of Trust. The Trust will be located and
administered in the State of Delaware. All bank accounts maintained by the Owner
Trustee on behalf of the Trust shall be located with the Certificate Paying
Agent in the State of __________. Payments will be received by the Certificate
Paying Agent on behalf of the Trust in ________ and payments will be made by the
Trust from ________. The Trust shall not have any employees in any state other
than Delaware; provided, however, that nothing herein shall restrict or prohibit
the Owner Trustee, the Master Servicer or any agent of the Trust from having
employees within or without the State of Delaware. The only office of the Trust
will be at the Corporate Trust Office in Delaware.
Section 2.10. Representations and Warranties of the Depositor. The
Depositor makes the following representations and warranties on which the Owner
Trustee relies in accepting the Owner Trust Estate in trust and executing the
Certificates and Notes and upon which any Series Support Provider relies in
providing any Series Support. Each of the following representations and
warranties shall be deemed to be made on each date on which a Series Trust
Estate is pledged under the Indenture.
(a) Organization and Good Standing. The Depositor is duly organized
and validly existing as a Nevada corporation 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 and is proposed to be conducted
pursuant to this Agreement and the Basic Documents.
(b) Due Qualification. It is duly qualified to do business as a
foreign corporation in good standing, and has obtained all necessary licenses
and approvals, in all jurisdictions in which the ownership or lease of its
property, the conduct of its business and the performance of its obligations
under this Agreement and the Basic Documents requires such qualification and in
which the failure to so qualify would have a material adverse effect on the
business, properties, assets or condition (financial or otherwise) of the
Depositor.
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(c) Power and Authority. The Depositor has the corporate power and
authority to execute and deliver this Agreement and to carry out its terms; the
Depositor has full power and authority to sell and assign the property to be
sold and assigned to and deposited with the Trust; the Depositor has duly
authorized such sale, assignment and deposit to the Trust by all necessary
corporate action; and the execution, delivery and performance of this Agreement
has been duly authorized by the Depositor by all necessary corporate action.
(d) Binding Obligations. This Agreement, when duly executed and
delivered, shall constitute legal, valid and binding obligations of the
Depositor enforceable against the Depositor in accordance with its terms, except
as enforceability may be limited by bankruptcy, insolvency, reorganization or
other similar laws affecting the enforcement of creditors' rights generally and
by equitable limitations on the availability of specific remedies, regardless of
whether such enforceability is considered in a proceeding in equity or at law.
(e) No Consent Required. To the best knowledge of the Depositor, no
consent, license, approval or authorization or registration or declaration with,
any Person or with any governmental authority, bureau or agency is required in
connection with the execution, delivery or performance of this Agreement, the
Basic Documents and the applicable Series Related Documents, except for such as
have been obtained, effected or made or as to which a failure to obtain, effect
or make would not have a material adverse effect on the business, properties,
assets or condition (financial or other) of the Depositor.
(f) No Violation. 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) a default under, the articles of
incorporation or by-laws of the Depositor, or any material 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 or any applicable Series Related
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,
provided, however, that the Receivables will not satisfy the Eligibility
Criteria set forth in Schedule I to the Series Supplement until the Closing
Date.
(g) No Proceedings. To the best of the Depositor's knowledge, there
are no proceedings or investigations pending or, to its knowledge threatened
against it before any court, regulatory body, administrative agency or other
tribunal or governmental instrumentality having jurisdiction over it or its
properties (A) asserting the invalidity of this Agreement or any of the Basic
Documents, (B) seeking to prevent the issuance of the Certificates or the Notes
or the consummation of any of the transactions contemplated by this Agreement or
any of the Basic Documents, (C) seeking any determination or ruling that might
materially and adversely affect its performance of its
7
obligations under, or the validity or enforceability of, this Agreement, any of
the Basic Documents or any Series Related Documents, or (D) seeking to adversely
affect the federal income tax or other federal, state or local tax attributes of
any of the Notes or Certificates.
Section 2.11. Federal Income Tax Allocations. (a) For so long as
the Trust has a single owner for federal income tax purposes, it will, pursuant
to Treasury Regulations promulgated under section 7701 of the Code, be
disregarded as an entity distinct from the Certificateholder for all federal
income tax purposes. Accordingly, for federal income tax purposes, the
Certificateholder will be treated as (i) owning all assets owned by the Trust,
(ii) having incurred all liabilities incurred by the Trust, and (iii) all
transactions between the Trust and the Certificateholder will be disregarded.
(b) Neither the Owner Trustee nor any Certificateholder will, under
any circumstances, and at any time, make an election on IRS Form 8832 or
otherwise, to classify the Trust as an association taxable as a corporation for
federal, state or any other applicable tax purpose.
(c) In the event that the Trust has two equity owners for federal
income tax purposes, the Trust will be treated as a partnership. At any such
time that the Trust has two equity owners, this Agreement will be amended, in
accordance with Section 11.1 herein, and appropriate provisions will be added so
as to provide for treatment of the Trust as a partnership.
Section 2.12. Covenants of the Depositor. The Depositor agrees and
covenants for the benefit of the Owner Trustee and the Indenture Trustee for the
benefit of the Noteholders, during the term of this Agreement, and to the
fullest extent permitted by applicable law, that:
(a) (i) it shall not create, incur or suffer to exist any
indebtedness or (ii) engage in any business, except (x) as permitted by its
certificate of incorporation, the Basic Documents and the Series Related
Documents or (y) in connection with a securitization transaction and the related
documents in which the related indebtedness is issued pursuant to an indenture
having a provision substantially similar to Section 11.18 of the Indenture;
provided, however, that no other Series shall be issued under the Basic
Documents and the Series Related Documents so long as the Series _____ Notes are
outstanding;
(b) it shall not, for any reason, institute proceedings for the
Trust to be adjudicated a bankrupt or insolvent, or consent to the institution
of bankruptcy or insolvency proceedings against the Trust, or file a petition
seeking or consenting to reorganization or relief under any applicable federal
or state law relating to the bankruptcy of the Trust, or consent to the
appointment of a receiver, liquidator, assignee, trustee, sequestrator (or other
similar official) of the Trust or a substantial part of the property of the
Trust or cause or permit the Trust to make any assignment for the benefit of
creditors, or admit in writing the inability of the Trust to pay its debts
generally as they
8
become due, or declare or effect a moratorium on the debt of the Trust or take
any action in furtherance of any such action;
(c) it shall obtain from each counterparty to each Basic Document to
which it or the Trust is a party and each other agreement entered into on or
after the date hereof to which it or the Trust is a party, an agreement by each
such counterparty that prior to the occurrence of the event specified in ss.
9.1(e) such counterparty shall not institute against, or join any other Person
in instituting against, it or the Trust, any bankruptcy, reorganization,
arrangement, insolvency or liquidation proceedings or other similar proceedings
under the laws of the United States or any state of the United States; and
(d) it shall not, for any reason, withdraw or attempt to withdraw
from this Agreement, dissolve, institute proceedings for it to be adjudicated a
bankrupt or insolvent, or consent to the institution of bankruptcy or insolvency
proceedings against it, or file a petition seeking or consenting to
reorganization or relief under any applicable federal or state law relating to
bankruptcy, or consent to the appointment of a receiver, liquidator, assignee,
trustee, sequestrator (or other similar official) of it or a substantial part of
its property, or make any assignment for the benefit of creditors, or admit in
writing its inability to pay its debts generally as they become due, or declare
or effect a moratorium on its debt or take any action in furtherance of any such
action.
Section 2.13. Covenants of the Certificateholders. Each
Certificateholder agrees:
(a) to be bound by the terms and conditions of the related
Certificates, of this Agreement and, with respect to the holders of
Certificates, of the related Series Supplement, including any supplements or
amendments hereto and to perform the obligations of a Certificateholder as set
forth therein or herein, in all respects as if it were a signatory hereto. This
undertaking is made for the benefit of the Trust, the Owner Trustee and the
Noteholders;
(b) to hereby appoint the Depositor as such Certificateholder's
agent and attorney-in-fact to sign any federal income tax information return
filed on behalf of the Trust, if any, and agree that, if requested by the Trust,
it will sign such federal income tax information return in its capacity as
holder of an interest in the Trust. Each Certificateholder also hereby agrees
that in its tax returns it will not take any position inconsistent with those
taken in any tax returns that may be filed by the Trust;
(c) if such Certificateholder is other than an individual or other
entity holding its Certificate through a broker who reports securities sales on
Form 1099-B, to notify the Owner Trustee of any transfer by it of a Certificate
in a taxable sale or exchange, within 30 days of the date of the transfer;
(d) until the completion of the events specified in ss. 9.1(e), not
to, for any reason, institute proceedings for the Trust or the Depositor to be
adjudicated a bankrupt or insolvent, or consent to the institution of bankruptcy
or insolvency
9
proceedings against the Trust, or file a petition seeking or consenting to
reorganization or relief under any applicable federal or state law relating to
bankruptcy, or consent to the appointment of a receiver, liquidator, assignee,
trustee, sequestrator (or other similar official) of the Trust or a substantial
part of its property, or cause or permit the Trust to make any assignment for
the benefit of its creditors, or admit in writing its inability to pay its debts
generally as they become due, or declare or effect a moratorium on its debt or
take any action in furtherance of any such action; and
(e) that there shall not be more than 98 other holders of
Certificates.
Section 2.14. Representations and Covenants of the Certificate
Majority and the Owner Trustee With Respect to the Trust Each of the Depositor,
as the holder initially of 100% of the Percentage Interests, the holders from
time to time of a Certificate Majority and the Owner Trustee, to the extent that
the Owner Trustee does not receive contrary instructions from the Certificate
Majority, agree that in the performance of their respective duties or powers
hereunder, and in each case only to the extent within its knowledge, power and
control, represent, covenant and agree as follows:
(a) the Trust shall be managed in such a manner that it would not be
substantively consolidated in the trust estate of any Affiliate in the event of
a bankruptcy or insolvency of such Affiliate;
(b) the Trust is not involved and shall not become involved in the
day-to-day management of any Affiliate;
(c) the Trust has not and shall not engage in transactions with any
Affiliate other than having Receivables sold to it and pledging or selling those
Receivables, and matters necessarily incident to or necessary to accomplish the
foregoing or which have been conducted on an arm's length basis;
(d) the Trust shall maintain its assets separately from the assets
of any Affiliate (including through the maintenance of a separate bank account);
(e) the Trust shall maintain separate financial statements, books
and records from any Affiliate, and a separate business office from each of
Household Bank and HAFC;
(f) the Trust shall not guarantee the obligations of, or advance
funds to, or accept funds from, any Affiliate for the payment of expenses,
except by means of capital contributions or pursuant to contractual documents
indicating the consideration for the receipt of such funds;
(g) the Trust shall conduct all business correspondence and other
communications in its own name;
(h) the Trust shall not act as an agent of any Affiliate in any
capacity; and
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(i) there are no agreements or understandings between the Depositor
and the Trust relevant to the transfer of the Series _____ Receivables, except
as set forth in the Series Related Documents.
ARTICLE III
Certificates and Transfer of Interests
Section 3.1. Initial Ownership. Upon the formation of the Trust by
the contribution by the Depositor pursuant to ss. 2.5, the Trust shall issue an
uncertificated ownership interest in the Trust (the "Uncertificated
Certificate") to the Depositor. Unless and until the Depositor transfers all or
a portion of the Percentage Interest represented by such Uncertificated
Certificate, such Uncertificated Certificate shall represent one hundred percent
(100%) of the Percentage Interest.
Section 3.2. The Certificates. (a) The Certificates shall be in
uncertificated form with records of interest ownership maintained by the
Certificate Registrar in the Certificate Register. If, on or after the Closing
Date, the holder of any Uncertificated Certificate delivers to the Owner Trustee
a written request that the Uncertificated Certificate specified in such request
be issued in certificated form (a related "Certification Request"), the Owner
Trustee shall promptly issue such Certificate to the holder thereof in
certificated form. If a Certification Request has been delivered, the
Certificate will be issued in registered form, substantially in the form of
Exhibit A, and shall upon issue, be executed and delivered by the Depositor to
the Owner Trustee for authentication and redelivery as provided in Section 3.3.
(b) If the Certificates are in certificated form, they 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 benefit 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) A transferee of a Certificate (whether in certificated or
uncertificated form) shall become a Certificateholder, and shall be entitled to
the rights and subject to the obligations of a Certificateholder hereunder, upon
due registration of such Certificate in such transferee's name pursuant to ss.
3.4.
(d) No Certificates shall be issued under this Agreement unless such
Certificates have been authorized pursuant to a Series Supplement and all
conditions precedent to the issuance thereof, as specified in the related Series
Supplement shall have been satisfied. All Certificates of each Series issued
under this Agreement shall be in all respects entitled to the benefits hereof
and of the related Series Trust Estate.
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(e) Upon the written direction of the Depositor, the Owner Trustee
and the Depositor shall enter into one or more Supplements, providing for the
issuance of separate Series of Certificates. Each Series shall be a separate
Series of the Trust within the meaning of Section 3806(b)(2) of the Business
Trust Statute. Separate and distinct records (including tax records) shall be
maintained for each Series and the Owner Trust Estate associated with each such
Series shall be maintained for each Series and the Owner Trust Estate associated
with each such Series shall be held in Trust and accounted for separately from
the Owner Trust Estate of any other Series. Except as specified in this
Agreement or in any Supplement, the Owner Trust Estate of any Series shall not
be subject to claims, debts, liabilities, expenses or obligations arising from
or with respect to the Trust or any other Series. The debts, obligations and
expenses incurred, contracted for or otherwise existing with respect to a
particular Series shall be enforceable against the related Owner Trust Estate
only and not against the assets of the Trust generally or any other Series.
Notice of this limitation on inter-series liabilities shall be set forth in the
Certificate of Trust (whether originally or by amendment) as filed with the
Secretary of State pursuant to the Business Trust Statute, and upon the giving
of such notice in the Certificate of Trust, the statutory provisions of Section
3804 of the Business Trust Statute relating to limitations on inter-series
liabilities (and the statutory effect under Section 3804 of setting forth such
notice in the Certificate of Trust) shall become applicable to the Trust and
each Series of Certificates.
(f) Each Supplement shall contain provisions requiring that neither
the Depositor nor any Holder of a Certificate of the related Series of
Certificates shall direct the Owner Trustee to (i) take any action that would
cause the Owner Trust Estate of the related Series to be substantively
consolidated into any other Owner Trust Estate of any other Series such that it
will have its separate existence disregarded in the event of an insolvency event
with respect to any Certificateholder of such Series, the Trust or another
Series, (ii) to commingle any of the Owner Trust Estate of the related Series
with the Owner Trust Estate of any other Series, (iii) to maintain the
corporate, financial and accounting books and records and statements of the
related Series, if any, in a manner such that they cannot be separated from
those of any other Series, (iv) to take any action that would cause (a) the
funds and other assets of the related Series, if any, not to be identifiable or
the bank accounts, corporate records and books of account, if any, of the
related Series not to be inseparable from those of any other Series and (b) the
Trust to pay, other than from assets of the related Series, any obligations or
indebtedness of any kind incurred by the related Series and payable by the Trust
pursuant to this Agreement, (v) to maintain the assets and liabilities of the
related Series so that they are not readily ascertainable from those of any
other Series and subject to segregation without requiring substantial time or
expense to effect and account for such segregated assets and liabilities, (vi)
to take any actions with respect to the related Series except in its capacity as
Owner Trustee in respect of such Series. The Master Servicer shall have the
right to take any action on behalf of the Trust to enforce the foregoing
provisions of each Supplement for the benefit of the Trust and of each Series.
(g) Each Certificateholder shall hold an exclusive, divided
beneficial interest in the Owner Trust Estate of its related Series of
Certificates.
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(h) The Certificateholders of any Series of Certificates shall be
entitled to receive distributions with respect to their undivided ownership
interest therein only in accordance with the provisions of Section 3.11 and the
related Supplement.
Section 3.3. Authentication of Certificates. If the Certificates are
in certificated form, the Owner Trustee shall cause the related Certificates to
be executed on behalf of the Trust, authenticated and delivered to or upon the
written order of the Depositor, signed by its chairman of the board, its
president or any vice president, its treasurer or any assistant treasurer
without further corporate action by the Depositor, in authorized denominations.
No Certificate shall entitle its holder to any benefit under this Agreement or,
with respect to a Series, the related Series Supplement, 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, executed by the
Owner Trustee or its authenticating agent, 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 3.4. Registration of Transfer and Exchange of
Certificates. (a) The Certificate Registrar shall keep or cause to be kept,
at the office or agency maintained pursuant to ss. 3.8, a Certificate Register
in which, subject to such reasonable regulations as it may prescribe, the Owner
Trustee shall provide for the registration of Certificates (whether in
certificated or uncertificated form) and of transfers and exchanges of
Certificates (whether in certificated or uncertificated form) as herein
provided. The Owner Trustee shall be the initial Certificate Registrar.
(b) The Certificate Registrar shall provide the Indenture Trustee
with a list of the names and addresses of the Certificateholders on each Series
Closing Date in the form which such information is provided to the Certificate
Registrar by the Depositor. Upon any transfers of Certificates, the Certificate
Registrar shall notify the Indenture Trustee of the name and address of the
transferee in writing, by facsimile, on the day of such transfer.
(c) If a Certificate is in certificated form, upon surrender for
registration of transfer of any Certificate to the Certificate Registrar at the
office or agency maintained pursuant to ss. 3.8, the Owner Trustee shall
execute, authenticate and deliver, in the name of the designated transferee or
transferees, one or more new Certificates of the same Series in the aggregate
Percentage Interest to be transferred, dated the date of authentication by the
Owner Trustee or any authenticating agent. If a Certificate is in uncertificated
form, upon representation of such Certificate in accordance with Section 3.2,
the Certificate Registrar shall reflect in the Certificate Registrar the
transfer of the relevant Percentage Interest. If a Certificate is in
certificated form, at the option of the Holder thereof, such Certificate may be
exchanged for one or more other Certificates of the same Series in authorized
denominations of a like Percentage Interest upon surrender of the Certificates
of the same Series, to be exchanged at the office or agency maintained pursuant
to ss. 3.8. Certificates may be issued in any Percentage Interest not to exceed
100%.
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(d) Every Certificate presented or, in the case of certificated
Certificates, 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 an "eligible guarantor institution" meeting the
requirements of the Certificate Registrar, which requirements include membership
or participation in the Securities Transfer Agent's Medallion Program ("STAMP")
or such other "signature guarantee program" as may be determined by the
Certificate Registrar in addition to, or in substitution for, STAMP, all in
accordance with the Exchange Act. Each certificated Certificate surrendered for
registration of transfer or exchange shall be canceled and subsequently disposed
of by the Owner Trustee in accordance with its customary practice.
(e) 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.
Section 3.5. Mutilated, Destroyed, Lost or Stolen Certificates. If
(a) any mutilated Certificate shall be surrendered to the Certificate Registrar,
or if the Certificate Registrar shall receive evidence to its satisfaction of
the destruction, loss or theft of any 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 bona fide
purchaser, the Owner Trustee on behalf of the Trust shall execute and the Owner
Trustee or its authenticating agent shall authenticate and deliver, in exchange
for or in lieu of any such mutilated, destroyed, lost or stolen Certificate, a
new Certificate of like Series principal balance. In connection with the
issuance of any new Certificate under this Section, the Owner Trustee or the
Certificate Registrar may require the payment of a sum sufficient to cover any
tax or other governmental charge that may be imposed in connection therewith.
Any duplicate Certificate issued pursuant to this section shall constitute
conclusive evidence of an ownership interest in the Trust, as if originally
issued, whether or not the lost, stolen or destroyed Certificate shall be found
at any time.
Section 3.6. Persons Deemed Certificateholders. Every Person by
virtue of becoming a Certificateholder in accordance with this Agreement and the
rules and regulations of the Certificate Registrar shall be deemed to be bound
by the terms of this Agreement. Prior to due presentation of a Certificate for
registration of transfer, the Owner Trustee, the Certificate Registrar and any
agent of the Owner Trustee and the Certificate Registrar 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 hereto, the Indenture or any Series Supplement (in the case of a
Certificate) and for all other purposes whatsoever, and none of the Owner
Trustee, the Certificate Registrar, nor any agent of the Owner Trustee or the
Certificate Registrar shall be bound by any notice to the contrary.
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Section 3.7. Access to List of Certificateholders' Names and
Addresses. The Owner Trustee or the Certificate Registrar shall furnish or cause
to be furnished to the Master Servicer, the Depositor or Owner Trustee within 15
days after receipt by the Owner Trustee or the Certificate Registrar of a
request therefor from such Person in writing, a list, of the names and addresses
of the Certificateholders as of the most recent Record Date. If three or more
Holders of Certificates or one or more Holders of Certificates evidencing not
less than 25% of the Percentage Interest apply in writing to the Owner Trustee
or the Certificate Registrar, and such application states that the applicants
desire to communicate with other Certificateholders with respect to their rights
under this Agreement, under the Certificates of such Series or under the related
Series Supplement and such application is accompanied by a copy of the
communication that such applicants propose to transmit, then the Owner Trustee
or the Certificate Registrar shall, within five Business Days after the receipt
of such application, afford such applicants access during normal business hours
to the current list of Certificateholders of such Series. Each Holder, by
receiving and holding a Certificate, shall be deemed to have agreed not to hold
any of the Depositor, the Master Servicer, the Owner Trustee or any agent
thereof accountable by reason of the disclosure of its name and address,
regardless of the source from which such information was derived.
Section 3.8. Maintenance of Office or Agency. The Owner Trustee or
the Certificate Registrar shall maintain in _________, Delaware, 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 its Corporate Trust Office for
such purposes. The Owner Trustee shall give prompt written notice to the
Depositor, the Certificateholders and (unless a Support Default shall have
occurred and be continuing) any Series Support Provider of any change in the
location of the Certificate Register or any such office or agency.
Section 3.9. ERISA Restrictions. The Certificates may not be
acquired by or for the account of (i) an employee benefit plan (as defined in
ss. 3(3) of the Employee Retirement Income Security Act of 1974, as amended
("ERISA")) that is subject to the provisions of Title I of ERISA, (ii) a plan
(as defined in ss. 4975(e)(1) of the Code) that is subject to Section 4975 of
the Code or (iii) any entity whose underlying assets include assets of a plan
described in (i) or (ii) by reason of such plan's investment in the entity
(each, a "Benefit Plan"). The Certificate Registrar shall not register the
transfer of a Certificate unless the transferee has delivered to the Owner
Trustee a representation letter in form and substance satisfactory to the Owner
Trustee to the effect that the transferee is not, and is not acquiring the
Certificate for the account of, a Benefit Plan.
Section 3.10. Securities Matters. Notwithstanding anything contained
herein to the contrary, the Owner Trustee shall not be responsible for
ascertaining whether any transfer complies with the registration provisions or
exemptions from the Securities Act, the Exchange Act, applicable state
securities law or the Investment Company Act; provided, however, that if a
certificate is specifically required to be delivered to the Owner Trustee by a
purchaser or transferee of a Certificate, the Owner
15
Trustee shall be under a duty to examine the same to determine whether it
conforms to the requirements of this Agreement and shall promptly notify the
party delivering the same if such certificate does not so conform.
Section 3.11. Distributions. Distributions shall be made from time
to time by the Owner Trustee or the Certificate Paying Agent in accordance with
the Percentage Interests of the Certificateholders.
Section 3.12. Paying Agent. Distributions to be made in respect of
the Certificates pursuant to this Agreement, or any Series Supplement shall be
made by 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 the Certificate or the making of any notation thereon, except as
provided in Section 9.1(c) with respect to the final distribution on a
Certificates.
ARTICLE IV
Voting Rights and Other Actions
Section 4.1. Prior Notice to Holders with Respect to Certain
Matters. With respect to the following matters, the Owner Trustee shall not take
action unless at least 30 days before the taking of such action, the Owner
Trustee shall have notified the Certificateholders in writing of the proposed
action and Certificateholders holding, in the aggregate, greater than 50% of the
Percentage Interests (a "Certificate Majority") 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 election by the Trust to file an amendment to the
Certificate of Trust, which amendment shall have satisfied the Rating Agency
Condition (unless such amendment is required to be filed under the Business
Trust Statute or unless such amendment would not materially and adversely affect
the interests of the Holders);
(b) the amendment of the Indenture by a supplemental indenture in
circumstances where the consent of any Noteholder is required;
(c) the amendment of the Indenture by a supplemental indenture in
circumstances where the consent of any Noteholder is not required and such
amendment materially adversely affects the interest of the Certificateholders;
or
(d) except pursuant to ss. 13.1(b) of the Master Sale and Servicing
Agreement, the amendment, change or modification of the Master Sale and
Servicing Agreement, except to cure any ambiguity or defect or to amend or
supplement any provision in a manner that would not materially adversely affect
the interests of the Certificateholders.
(e) the Depositor shall not, without the unanimous consent of the
holders of the Class SV Preferred Stock of the Depositor, institute proceedings
to be
16
adjudicated insolvent, or consent to the institution of any bankruptcy or
insolvency case or proceedings against it, or file or consent to a petition
under any applicable federal or state law relating to bankruptcy, seeking the
Depositor's liquidation or reorganization or any other relief for the
Corporation as debtor, or consent to the appointment of a receiver, liquidator,
assignee, trustee, custodian or sequestrator (or other similar official) of the
Corporation or a substantial part of its property, or make any assignment for
the benefit of creditors, or admit in writing its inability to pay its debts
generally as they become due, or take any corporate action in furtherance of
such action.
The Owner Trustee shall notify the Certificateholders in writing of any
appointment of a successor Note Registrar or Certificate Registrar within five
Business Days thereof.
Section 4.2. Action by Certificateholders with Respect to Certain
Matters. The Owner Trustee shall not have the power (a) to remove the Master
Servicer under the Master Sale and Servicing Agreement or (b) except as
expressly provided in the Indenture and the related Series Supplement and at the
written direction of the Certificateholders, sell the Receivables after the
termination of the Indenture. The Owner Trustee shall take the actions referred
to in the preceding sentence only upon written instructions signed by the
Certificateholders and the furnishing of indemnification satisfactory to the
Owner Trustee by the Certificateholders.
Section 4.3. Action by Certificateholders with Respect to
Bankruptcy. Until one year and one day following the date of payment in full of
the Notes of each Series have been paid in full, the Owner Trustee shall not
have the power to, and shall not, commence any proceeding or other actions
contemplated by ss. 2.13(d) hereof relating to the Trust without the prior
written consent of all the Certificateholders and the delivery to the Owner
Trustee by each such Certificateholder of a certificate certifying that such
Certificateholder reasonably believes that the Trust is insolvent.
Section 4.4. Restrictions on Certificateholders' Power. (a) 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, any of the Basic
Documents or any Series Related Documents or would be contrary to ss. 2.3 or ss.
2.14 or otherwise contrary to law nor shall the Owner Trustee be obligated to
follow any such direction, if given.
(b) No Certificateholder shall have any right by virtue or by
availing itself of any provisions of this Agreement to institute any suit,
action, or proceeding in equity or at law upon or under or with respect to this
Agreement or any Basic Document, unless there are no outstanding notes of any
Series and unless the Certificate Majority previously shall have given to the
Owner Trustee a written notice of default and of the continuance thereof, as
provided in this Agreement, and also unless the Certificate Majority shall have
made written request upon the Owner Trustee to institute such action, suit or
proceeding in its own name as Owner Trustee under this Agreement and shall have
offered to the Owner Trustee such reasonable indemnity as it may require against
the costs, expenses and liabilities to be incurred therein or thereby, and the
Owner Trustee, for 30 days after its receipt of such notice, request, and offer
of indemnity, shall
17
have neglected or refused to institute any such action, suit, or proceeding, and
during such 30-day period no request or waiver inconsistent with such written
request has been given to the Owner Trustee pursuant to and in compliance with
this section or ss. 6.3; it being understood and intended, and being expressly
covenanted by each Certificateholder with every other Certificateholder and the
Owner Trustee, that no one or more Holders of Certificates shall have any right
in any manner whatever by virtue or by availing itself or themselves of any
provisions of this Agreement to affect, disturb, or prejudice the rights of the
Holders of any other of the Certificates, or to obtain or seek to obtain
priority over or preference to any other such Holder, or to enforce any right
under this Agreement, except in the manner provided in this Agreement and for
the equal, ratable, and common benefit of all Certificateholders. For the
protection and enforcement of the provisions of this ss. 4.4, each and every
Certificateholder and the Owner Trustee shall be entitled to such relief as can
be given either at law or in equity.
Section 4.5. Majority Control. No Certificateholder shall have any
right to vote or in any manner otherwise control the operation and management of
the Trust except as expressly provided in this Agreement. Except as expressly
provided herein, any action that may be taken by the Certificateholders under
this Agreement may be taken by the Certificate Majority. Except as expressly
provided herein, any written notice of the Certificateholders delivered pursuant
to this Agreement shall be effective if signed by the Certificate Majority at
the time of the delivery of such notice.
ARTICLE V
Certain Duties
Section 5.1. Accounting and Records to the Noteholders,
Certificateholders, the Internal Revenue Service and Others. Subject to
Sections 12.1(b)(iii) and 12.1(c) of the Master Sale and Servicing Agreement,
the Master Servicer shall (a) maintain (or cause to be maintained) the books of
the Trust on a calendar year basis on the accrual method of accounting,
including, without limitation, the allocations of net income under ss. 2.11, (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, if applicable) to enable each
Certificateholder to prepare its Federal and state income tax returns, (c) file
or cause to be filed, if necessary, such tax returns relating to the Trust
(including a partnership information return, Form 1065), and direct the Owner
Trustee or the Master Servicer, as the case may be, to 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 branch, or if applicable, as a partnership, for Federal
income tax purposes and (d) collect or cause to be collected any withholding tax
as described in and in accordance with the Master Sale and Serving Agreement or
any Series Supplement with respect to income or distributions to
Certificateholders and the appropriate forms relating thereto. The Owner Trustee
or the Master Servicer, as the case may be, shall make all elections pursuant to
this ss. 5.1 as directed in writing by the Depositor. The Owner Trustee shall
sign all tax information returns, if any, filed pursuant to this ss. 5.1 and any
other returns as may be required by law, and in doing so shall rely entirely
upon,
18
and shall have no liability for information provided by, or calculations
provided by, the Depositor or the Master Servicer. The Owner Trustee shall elect
under ss. 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 ss. 754 of the Code.
Section 5.2. Signature on Returns; Tax Matters Partner. (a)
Notwithstanding the provisions of ss. 5.1 and in the event that the Trust is
characterized as a partnership, the Owner Trustee shall sign on behalf of the
Trust the tax returns of the Trust, unless applicable law requires a
Certificateholder to sign such documents, in which case such documents shall be
signed by the Depositor.
(b) In the event that the Trust is characterized as a partnership,
the Depositor shall be the "tax matters partner" of the Trust pursuant to the
Code.
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 and
each Series Supplement and the related Series Related Documents to which the
Trust is named as a party and each certificate or other document attached as an
exhibit to or contemplated by the Basic Documents and each Series Supplement and
the related Series Related Documents to which the Trust is named as a party and
any amendment thereto, in each case, in such form as the Depositor shall approve
as evidenced conclusively by the Owner Trustee's execution thereof, and on
behalf of the Trust, to direct the Indenture Trustee to authenticate and deliver
each Series of Notes (or Class of such Series). In addition to the foregoing,
the Owner Trustee is authorized, but shall not be obligated, to take all actions
required of the Trust pursuant to the Basic Documents and each Series Supplement
and the related Series Related Documents. The Owner Trustee is further
authorized from time to time to take such action as the Certificate Majority
recommends with respect to the Basic Documents and each Series Supplement and
the related Series Related Documents so long as such activities are consistent
with the terms of the Basic Documents and each Series Supplement and the related
Series Related Documents.
Section 6.2. General Duties. It shall be the duty of the Owner
Trustee to discharge (or cause to be discharged) all of its responsibilities
pursuant to the terms of this Agreement and to administer the Trust in
accordance with the provisions of this Agreement and in the interest of the
Holders, subject to the Basic Documents and, with respect to Certificates, each
Series Supplement and the related Series Related Documents. Notwithstanding the
foregoing, the Owner Trustee shall be deemed to have discharged its duties and
responsibilities hereunder and under the Basic Documents and, with respect to
Certificates, each Series Supplement and the related Series Related Documents to
the extent the Master Servicer has agreed in the Master Sale and Servicing
Agreement to perform any act or to discharge any duty of the Trust or the Owner
Trustee hereunder or under any Basic Document and, with respect to Certificates,
each Series Supplement and
19
the related Series Related Documents, and the Owner Trustee shall not be liable
for the default or failure of the Master Servicer to carry out its obligations
under the Master Sale and Servicing Agreement.
Section 6.3. Action upon Instruction. (a) Subject to Article IV,
the Certificate Majority shall have the exclusive right to direct the actions of
the Owner Trustee in the management of the Trust, so long as such instructions
are not inconsistent with the express terms set forth herein, in any Basic
Document or, with respect to Certificates, in any Series Supplement or in any
Series Related Document. The Certificate Majority shall not instruct the Owner
Trustee in a manner inconsistent with this Agreement or the Basic Documents or,
with respect to Certificates, any Series Supplement or any Series Related
Document.
(b) The Owner Trustee shall not be required to take any action
hereunder or under any Basic Document or, with respect to Certificates, any
Series Supplement or any Series Related Document if the Owner Trustee shall have
reasonably determined, or shall have been advised by counsel, that such action
is likely to result in liability on the part of the Owner Trustee or is contrary
to the terms hereof or of any Basic Document or, with respect to Certificates,
any Series Supplement or any Series Related 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 Basic Document or, with respect to Certificates, any Series
Supplement or any Series Related Document, the Owner Trustee shall promptly give
notice (in such form as shall be appropriate under the circumstances) to the
Certificate Majority 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 Certificate Majority, the Owner Trustee
shall not be liable on account of such action to any Person. If the Owner
Trustee shall not have received appropriate instruction within ten days of such
notice (or within such shorter period of time as reasonably may be specified in
such notice or may be necessary under the circumstances) it may, but shall be
under no duty to, take or refrain from taking such action, not inconsistent with
this Agreement or the Basic Documents or, with respect to Certificates, any
Series Supplement or any Series Related Document, as it shall deem to be in the
best interests of the Certificateholders, and shall have no liability to any
Person for such action or inaction.
(d) In the event that the Owner Trustee is unsure as to the
application of any provision of this Agreement or any Basic Document or, with
respect to Certificates, any Series Supplement or any Series Related 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 Certificate
Majority requesting instruction and, to the extent that the Owner Trustee acts
or refrains from acting in good faith in accordance with any such instruction
20
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 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, the Basic
Documents or any Series Related Document, 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 is a party, except as expressly provided by the terms
of this Agreement or in any document or written instruction received by the
Owner Trustee pursuant to ss. 6.3; and no implied duties or obligations shall be
read into this Agreement or any Basic Document or, with respect to Certificates,
any Series Supplement or any Series Related 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 Basic Document or, with respect to Certificates, any
Series Supplement or any Series Related Document. The Owner Trustee nevertheless
agrees that it will, at its own cost and expense, promptly take all action as
may be necessary to discharge any Liens on any part of the Owner Trust Estate
that result from actions by, or claims against, the Owner Trustee (solely in its
individual capacity) and 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 Basic Documents
or any Series Related Document and (iii) in accordance with any document or
instruction delivered to the Owner Trustee pursuant to ss. 6.3.
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 ss.
2.3 or (b) that, to the actual knowledge of the Owner Trustee, would result in
the Trust's becoming taxable as a corporation or a publicly traded partnership
for Federal income tax purposes. The Certificateholders shall not direct the
Owner Trustee to take action that would violate the provisions of this Section.
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ARTICLE VII
Concerning the Owner Trustee
Section 7.1. Acceptance of Trusts and Duties. The Owner Trustee
accepts the trusts hereby created and agrees to perform its duties hereunder
with respect to such trusts but only upon the terms of this Agreement. The Owner
Trustee and the Certificate Paying Agent also agree to disburse all monies
actually received by it constituting part of the Owner Trust Estate upon the
terms of this Agreement or the Basic Documents or, with respect to Certificates,
any Series Supplement or any Series Related Document. The Owner Trustee shall
not be answerable or accountable hereunder or under any Basic Document or, with
respect to Certificates, any Series Supplement or any Series Related Document
under any circumstances, except (i) for its own willful misconduct, bad faith or
negligence, (ii) in the case of the inaccuracy of any representation or warranty
contained in ss. 7.3 expressly made by the Owner Trustee in its individual
capacity, (iii) for liabilities arising from the failure of the Owner Trustee to
perform obligations expressly undertaken by it in the last sentence of ss. 6.4
hereof, (iv) for any investments issued by the Owner Trustee or any branch or
affiliate thereof in its commercial capacity or (v) for taxes, fees or other
charges on, based on or measured by, any fees, commissions or compensation
received by the Owner Trustee. In particular, but not by way of limitation (and
subject to the exceptions set forth in the preceding sentence):
(a) the Owner Trustee shall not be liable for any error of judgment
made by a Responsible Officer of the Owner Trustee;
(b) the Owner Trustee shall not be liable with respect to any action
taken or omitted to be taken by it in accordance with the instructions of the
Certificate Majority, the Depositor, the Master Servicer or any
Certificateholder;
(c) no provision of this Agreement or any Basic Document or, with
respect to Certificates, any Series Supplement or any Series Related Document
shall require the Owner Trustee to expend or risk funds or otherwise incur any
financial liability in the performance of any of its rights or powers hereunder
or under any Basic Document or, with respect to Certificates, any Series
Supplement or any Series Related Document if the Owner Trustee shall have
reasonable grounds for believing that repayment of such funds or adequate
indemnity against such risk or liability is not reasonably assured or provided
to it;
(d) under no circumstances shall the Owner Trustee be liable for
indebtedness evidenced by or arising under any of the Basic Documents or, with
respect to Certificates, any Series Supplement or any Series Related Document,
including the principal of and interest on the Notes;
(e) the Owner Trustee shall not be responsible for or in respect of
the validity or sufficiency of this Agreement or for the due execution hereof by
the Depositor or for the form, character, genuineness, sufficiency, value or
validity of any of the Owner
22
Trust Estate or for or in respect of the validity or sufficiency of the Basic
Documents or, with respect to Certificates, any Series Supplement or any Series
Related Document, other than the certificate of authentication on the
Certificates, and the Owner Trustee shall in no event assume or incur any
liability, duty or obligation to the Depositor, any Series Support Provider,
Indenture Trustee, the Certificate Paying Agent, any Noteholder or to any
Certificateholder, other than as expressly provided for herein, in the Basic
Documents or, with respect to Certificates, any Series Supplement or any Series
Related Document;
(f) the Owner Trustee shall not be liable for the default or
misconduct of the Depositor, any Series Support Provider, the Indenture Trustee
or the Master Servicer under any of the Basic Documents or otherwise and the
Owner Trustee shall have no obligation or liability to perform the obligations
under this Agreement, the Basic Documents or, with respect to Certificates, any
Series Supplement or any Series Related Document that are required to be
performed by the Depositor or the Certificate Paying Agent under this Agreement,
by the Indenture Trustee under the Indenture, any Series Supplement or any
Series Related Document or the Master Servicer under the Master Sale and
Servicing Agreement or any Series Supplement or any Series Related Document; and
(g) the Owner Trustee shall be under no obligation to exercise any
of the rights or powers vested in it by this Agreement, or to institute, conduct
or defend any litigation under this Agreement or otherwise or in relation to
this Agreement or any Basic Document or, with respect to Certificates, any
Series Supplement or any Series Related Document, at the request, order or
direction of the Certificate Majority or any of the Certificateholders, unless
such Certificate Majority or Certificateholders have offered to the Owner
Trustee security or indemnity satisfactory to it against the costs, expenses and
liabilities that may be incurred by the Owner Trustee therein or thereby. The
right of the Owner Trustee to perform any discretionary act enumerated in this
Agreement or in any Basic Document shall not be construed as a duty, and the
Owner Trustee shall not be answerable for other than its negligence, bad faith
or willful misconduct 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 or, with respect to Certificates, any
Series Supplement or any Series Related Document.
Section 7.3. Representations and Warranties. The Owner Trustee
hereby represents and warrants, in its individual capacity, to the Depositor,
the Holders and any Series Support Provider (which shall have relied on such
representations and warranties in issuing any policy relating to Series
Support), that:
(a) It is a Delaware banking corporation, duly organized and validly
existing in good standing under the laws of the State of Delaware. It has all
requisite
23
corporate power and authority to execute, deliver and perform its obligations
under this Agreement.
(b) It has taken all corporate action necessary to authorize the
execution and delivery by it of this Agreement, and 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.
(c) 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.
Section 7.4. Reliance; Advice of Counsel. (a) The Owner Trustee
shall incur no liability to anyone in acting upon any signature, instrument,
notice, resolution, request, consent, order, certificate, report, opinion, bond
or other document or paper believed by it to be genuine and believed by it to be
signed by the proper party or parties. The Owner Trustee may accept a certified
copy of a resolution of the board of directors or other governing body of any
corporate party as conclusive evidence that such resolution has been duly
adopted by such body and that the same is in full force and effect. As to any
fact or matter the method of the determination of which is not specifically
prescribed herein, the Owner Trustee may for all purposes hereof rely on a
certificate, signed by the president or any vice president or by the treasurer,
secretary or other authorized officers of the relevant party, as to such fact or
matter, and such certificate shall constitute full protection to the Owner
Trustee for any action taken or omitted to be taken by it in good faith in
reliance thereon.
(b) In the exercise or administration of the trusts hereunder and in
the performance of its duties and obligations under this Agreement or the Basic
Documents, the Owner Trustee (i) may act directly or through its agents or
attorneys pursuant to agreements entered into with any of them, and the Owner
Trustee shall not be liable for the conduct or misconduct of such agents or
attorneys if such agents or attorneys shall have been selected by the Owner
Trustee with reasonable care, and (ii) may consult with counsel, accountants and
other skilled persons to be selected with reasonable care and employed by it.
The Owner Trustee shall not be liable for anything done, suffered or omitted in
good faith by it in accordance with the written opinion or advice of any such
counsel, accountants or other such persons and according to such opinion not
contrary to this Agreement or any Basic Document or, with respect to
Certificates, any Series Supplement or any Series Related Document.
Section 7.5. Not Acting in Individual Capacity. Except as provided
in this Article VII, in accepting the trusts hereby created [Name of Owner
Trustee] acts solely as Owner Trustee hereunder and not in its individual
capacity and all Persons having any claim against the Owner Trustee by reason of
the transactions contemplated
24
by this Agreement or any Basic Document or, with respect to Certificates, any
Series Supplement or any Series Related 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 certificated Certificates
(other than the signature and countersignature of the Owner Trustee on such
Certificates) shall be taken as the statements of the Depositor and the Owner
Trustee assumes no responsibility for the correctness thereof. The Owner Trustee
makes no representations as to the validity or sufficiency of this Agreement, of
any Basic Document or of the Certificates (other than the signature and
countersignature of the Owner Trustee on certificated Certificates) or the
Notes, or of any Receivable or related documents. The Owner Trustee shall at no
time have any responsibility or liability for or with respect to the legality,
validity and enforceability of any Receivable, or the perfection and priority of
any security interest created by any Receivable in any Financed Vehicle or the
maintenance of any such perfection and priority, or for or with respect to the
sufficiency of the 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 of any intervening assignment; the completeness of any Receivable; the
performance or enforcement of any Receivable; the compliance by the Depositor,
the Master Servicer or any other Person with any warranty or representation made
under any Basic Document or in any related document or the accuracy of any such
warranty or representation or any action of the Indenture Trustee or the Master
Servicer or any subservicer taken in the name of the Owner Trustee.
Section 7.7. Owner Trustee May Own Certificates and Notes. The Owner
Trustee in its individual or any other capacity may become the owner or pledgee
of Certificates or Notes and may deal with the Depositor, the Indenture Trustee
and the Master Servicer in banking transactions with the same rights as it would
have if it were not Owner Trustee.
Section 7.8. Payments from Owner Trust Estate All payments to be
made by the Owner Trustee or any Certificate Paying Agent under this Agreement
or any of the Basic Documents or, with respect to Certificates, any Series
Supplement or any Series Related Document to which the Trust or the Owner
Trustee is a party shall be made only from the income and proceeds of the Owner
Trust Estate and only to the extent that the Owner Trust shall have received
income or proceeds from the Owner Trust Estate to make such payments in
accordance with the terms hereof. [Name of Owner Trustee], or any successor
thereto, in its individual capacity, shall not be liable for any amounts payable
under this Agreement or any of the Basic Documents or, with respect to
Certificates, any Series Supplement or any Series Related Document to which the
Trust or the Owner Trustee is a party.
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Section 7.9. Doing Business in Other Jurisdictions. Notwithstanding
anything contained to the contrary, neither [Name of Owner Trustee] or any
successor thereto, nor the Owner Trustee shall be required to take any action in
any jurisdiction other than in the State of Delaware if the taking of such
action will, even after the appointment of a co-trustee or separate trustee in
accordance with ss. 10.5 hereof, (i) require the consent or approval or
authorization or order of or the giving of notice to, or the registration with
or the taking of any other action in respect of, any state or other governmental
authority or agency of any jurisdiction other than the State of Delaware; (ii)
result in any fee, tax or other governmental charge under the laws of the State
of Delaware becoming payable by [Name of Owner Trustee] (or any successor
thereto); or (iii) subject [Name of Owner Trustee] (or any successor thereto) to
personal jurisdiction in any jurisdiction other than the State of Delaware for
causes of action arising from acts unrelated to the consummation of the
transactions by [Name of Owner Trustee] (or any successor thereto) or the Owner
Trustee, as the case may be, contemplated hereby.
ARTICLE VIII
Compensation of Owner Trustee
Section 8.1. Owner Trustee's Fees and Expenses. The Owner Trustee
shall receive as compensation for its services hereunder such fees as have been
separately agreed upon before the date hereof between Household and the Owner
Trustee, and the Owner Trustee shall be entitled to be reimbursed by the
Depositor for its other reasonable expenses hereunder, including the reasonable
compensation, expenses and disbursements of such agents, representatives,
experts and counsel as the Owner Trustee may employ in connection with the
exercise and performance of its rights and its duties hereunder or under the
Basic Documents or, with respect to Certificates, under any Series Supplement or
under any Series Related Documents.
Section 8.2. Indemnification. The Depositor shall be liable as
primary obligor for, and shall indemnify the Owner Trustee (in its individual
and trust capacities) and its officers, directors, successors, assigns, agents
and servants (collectively, the "Indemnified Parties") from and against, any and
all liabilities, obligations, losses, damages, taxes, claims, actions and suits,
and any and all reasonable costs, expenses and disbursements (including
reasonable legal fees and expenses) of any kind and nature whatsoever
(collectively, "Expenses") which may at any time be imposed on, incurred by, or
asserted against the Owner Trustee (in its trust or individual capacities) or
any Indemnified Party in any way relating to or arising out of this Agreement or
the Basic Documents or, with respect to Certificates, any Series Supplement, any
series Related Documents, the Owner Trust Estate, the administration of the
Owner Trust Estate or the action or inaction of the Owner Trustee hereunder,
except only that the Depositor shall not be liable for or required to indemnify
the Owner Trustee from and against Expenses arising or resulting from any of the
matters described in the third sentence of ss. 7.1. The indemnities contained in
this ss. 8.2 and the rights under ss. 8.1 shall survive the resignation or
termination of the Owner Trustee or the termination of this Agreement. In any
event of any claim, action or proceeding for which indemnity will be sought
pursuant to this
26
Section, the Owner Trustee's 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 the Owner Trustee. Any amounts paid to the
Owner Trustee in its Trust Capacity pursuant to this Article VIII shall be
deemed not to be a part of the Owner Trust Estate immediately after such payment
and any amounts so paid to the Owner Trustee, in its individual capacity shall
not be so paid out of the Owner Trust Estate but shall be the property of the
Owner Trustee in its individual capacity.
Section 8.4. Non-recourse Obligations. Notwithstanding anything in
this Agreement or any Basic Document or, with respect to Certificates, any
Series Supplement or any Series Related Document, the Owner Trustee agrees in
its individual capacity and in its capacity as Owner Trustee for the Trust that
all obligations of the Trust to the Owner Trustee individually or as Owner
Trustee for the Trust shall be recourse to the Owner Trust Estate only and
specifically shall not be recourse to the assets of any Certificateholder.
ARTICLE IX
Termination of Agreement
Section 9.1. Termination of Agreement. (a) This Agreement shall
terminate and the Trust shall wind up, dissolve and be of no further force or
effect upon the latest to occur of (i) the maturity or other liquidation of the
last Receivable (including the optional purchase by the Depositor or the Master
Servicer of the corpus of the Trust as described in ss. 11.1 of the Master Sale
and Servicing Agreement) and the subsequent distribution of amounts in respect
of such Receivables as provided in the Basic Documents and, with respect to
amounts released from the Lien of the Indenture, distribution thereof to the
Certificateholders, or (ii) the payment to Noteholders and Certificateholders of
each Series of all amounts required to be paid to them pursuant to the Indenture
and this Agreement, including, with respect to amounts released from the Lien of
the Indenture, distribution thereof to the Certificateholders, and the payment
to any Series Support Provider of all amounts payable or reimbursable to it
pursuant to the related Series Supplement; provided, however, that the rights to
indemnification under ss. 8.2 and the rights under ss. 8.1 shall survive the
termination of the Trust. The Master Servicer shall promptly notify the Owner
Trustee of any prospective termination pursuant to this ss. 9.1. The bankruptcy,
liquidation, dissolution, death or incapacity of any Certificateholder 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.
(b) Except as provided in clause (a), neither the Depositor nor any
other Certificateholder shall be entitled to revoke or terminate the Trust.
27
(c) If any Certificates are in certificated form, notice of any
termination of a Series Trust Estate, specifying the Distribution Date upon
which the Certificateholders of such Series 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 of such Series mailed within five Business Days of receipt of
notice of such termination given pursuant to Section 9.1(a) hereof, stating (i)
the Distribution Date upon or with respect to which final payment of the
Certificates of such Series shall be made upon presentation and surrender of the
Certificates of such Series at the office of the Certificate Paying Agent
therein designated, (ii) the amount of any such final payment, (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 of
such Series at the office of the Certificate Paying Agent therein specified and
(iv) interest will cease to accrue on the Certificates of such Series. 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 of
such Series, the Certificate Paying Agent shall cause to be distributed to
Certificateholders of such Series amounts distributable pursuant to the related
Series Supplement.
(d) If any Certificates are in certificated form, in the event that
all of the Certificateholders holding certificated Certificates of such Series
shall not surrender their Certificates for cancellation within six months after
the date specified in the above-mentioned written notice, the Certificate Paying
Agent shall give a second written notice to the remaining Certificateholders
holding certificated Certificates of such Series to surrender their Certificates
for cancellation and receive the final distribution with respect thereto. If
within one year after the second notice all the certificated Certificates of
such Series shall not have been surrendered for cancellation, the Certificate
Paying Agent may take appropriate steps, or may appoint an agent to take
appropriate steps, to contact the remaining Certificateholders holding
certificated Certificates concerning surrender of their Certificates, and the
cost thereof shall be paid out of the funds and other Series Trust Estate assets
that shall remain subject to this Agreement. Any funds remaining in the Trust
after exhaustion of such remedies shall be distributed, subject to applicable
escheat laws, by the Certificate Paying Agent to the Depositor and Holders shall
look solely to the Depositor for payment.
(e) Any funds remaining in the Trust after funds for final
distribution have been distributed or set aside for distribution shall be
distributed by the Certificate Paying Agent to the Depositor.
(f) Upon the winding up of the Trust and its dissolution, the Owner
Trustee shall cause the Certificate of Trust to be canceled by filing a
certificate of cancellation with the Secretary of State in accordance with the
provisions of ss. 3810 of the Business Trust Statute.
28
ARTICLE X
Successor Owner Trustees and Additional Owner Trustees
Section 10.1. Eligibility Requirements for Owner Trustee. The Owner
Trustee shall at all times be a corporation (i) satisfying the provisions of ss.
3807(a) of the Business Trust Statute; (ii) authorized to exercise corporate
trust powers; (iii) having a combined capital and surplus of at least
$50,000,000 and subject to supervision or examination by Federal or State
authorities; (iv) having (or having a parent which has) a rating of at least
Baa3 by Moody's or A-1 by Standard & Poors; and (v) acceptable to the
Certificateholders. If such corporation shall publish reports of condition at
least annually, pursuant to law or to the requirements of the aforesaid
supervising or examining authority, then for the purpose of this Section, the
combined capital and surplus of such corporation shall be deemed to be its
combined capital and surplus as set forth in its most recent report of condition
so published. In case at any time the Owner Trustee shall cease to be eligible
in accordance with the provisions of this Section, the Owner Trustee shall
resign immediately in the manner and with the effect specified in ss. 10.2.
Section 10.2. Resignation or Removal of Owner Trustee. The Owner
Trustee may at any time resign and be discharged from the trusts hereby created
by giving written notice thereof to the Depositor (or in the event that the
Depositor is not the sole Certificateholder, the Certificate Majority), any
Series Support Provider and the Master Servicer. Upon receiving such notice of
resignation, the Depositor shall promptly appoint a successor Owner Trustee,
meeting the qualifications set forth in ss. 10.1 herein, by written instrument,
in duplicate, one copy of which instrument shall be delivered to the resigning
Owner Trustee and one copy to the successor Owner Trustee, provided that the
Depositor shall have received written confirmation from each of the Rating
Agencies that the proposed appointment will not result in an increased capital
charge to any Series Support Provider by either of the Rating Agencies. If no
successor Owner Trustee shall have been so appointed and have accepted
appointment within 30 days after the giving of such notice of resignation, the
resigning Owner Trustee or any Series Support Provider may petition any court of
competent jurisdiction for the appointment of a successor Owner Trustee.
If at any time the Owner Trustee shall cease to be eligible in
accordance with the provisions of ss. 10.1 and shall fail to resign after
written request therefor by the Depositor, or if at any time the Owner Trustee
shall be legally unable to act, or shall be adjudged bankrupt or insolvent, or a
receiver of the Owner Trustee or of its property shall be appointed, or any
public officer shall take charge or control of the Owner Trustee or of its
property or affairs for the purpose of rehabilitation, conservation or
liquidation, then the Depositor may remove the Owner Trustee. If the Depositor
shall remove the Owner Trustee under the authority of the immediately preceding
sentence, the Depositor shall promptly appoint a successor Owner Trustee,
meeting the qualifications set forth in ss. 10.1 herein, by written instrument,
in duplicate, one copy of which instrument shall be delivered to the outgoing
Owner Trustee so removed, one copy to any Series Support Provider and one copy
to the successor Owner Trustee and payment of all fees owed to the outgoing
Owner Trustee.
29
Any resignation or removal of the Owner Trustee and appointment of a
successor Owner Trustee pursuant to any of the provisions of this section shall
not become effective until acceptance of appointment by the successor Owner
Trustee pursuant to ss. 10.3 and payment of all fees and expenses owed to the
outgoing Owner Trustee. The Depositor shall provide notice of such resignation
or removal of the Owner Trustee to each of the Rating Agencies.
Section 10.3. Successor Owner Trustee. Any successor Owner Trustee
appointed pursuant to ss. 10.2 shall execute, acknowledge and deliver to the
Depositor, the Master Servicer, each Series Support Provider and to its
predecessor Owner Trustee an instrument accepting such appointment under this
Agreement, and thereupon the resignation or removal of the predecessor Owner
Trustee shall become effective and such successor Owner Trustee, without any
further act, deed or conveyance, shall become fully vested with all the rights,
powers, duties and obligations of its predecessor under this Agreement, with
like effect as if originally named as Owner Trustee. The predecessor Owner
Trustee shall upon payment of its fees and expenses deliver to the successor
Owner Trustee all documents and statements and monies held by it under this
Agreement; and the Depositor and the predecessor Owner Trustee shall execute and
deliver such instruments and do such other things as may reasonably be required
for fully and certainly vesting and confirming in the successor Owner Trustee
all such rights, powers, duties and obligations.
No successor Owner Trustee shall accept appointment as provided in
this section unless at the time of such acceptance such successor Owner Trustee
shall be eligible pursuant to ss. 10.1.
Upon acceptance of appointment by a successor Owner Trustee pursuant
to this Section, the Master Servicer shall mail notice of the successor of such
Owner Trustee to all Certificateholders, the Indenture Trustee, the Noteholders
and the Rating Agencies. If the Master Servicer shall fail to mail such notice
within 10 days after acceptance of appointment by the successor Owner Trustee,
the successor Owner Trustee shall cause such notice to be mailed at the expense
of the Master Servicer.
Any successor Owner Trustee appointed pursuant to this Section 10.3
shall promptly file an amendment to the Certificate of Trust with the Secretary
of State identifying the name and principal place of business of such successor
Owner Trustee in the State of Delaware.
Section 10.4. Merger or Consolidation of Owner Trustee. Any
corporation into which the Owner 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 shall be a party, or any
corporation succeeding to all or substantially all of the corporate trust
business of the Owner Trustee, shall be the successor of the Owner Trustee
hereunder, provided such corporation shall be eligible pursuant to ss. 10.1,
without the execution or filing of any instrument or any further act on the part
of any of the parties hereto, anything herein to the contrary notwithstanding;
provided further (i) that the Owner Trustee shall mail notice of such merger or
30
consolidation to the Rating Agencies, the Depositor and the Master Servicer and
(ii) any successor Owner 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.
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 Master Servicer 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 and any Series Support Provider to act as
co-trustee, jointly with the Owner Trustee, or separate trustee or separate
trustees, of all or any part of the Owner Trust Estate, and to vest in such
Person, in such capacity, such title to the Trust, or any part thereof, and,
subject to the other provisions of this Section, such powers, duties,
obligations, rights and trusts as the Master Servicer and the Owner Trustee may
consider necessary or desirable. If the Master Servicer shall not have joined in
such appointment within 15 days after the receipt by it of a request so to do,
the Owner Trustee, subject to the approval of the Certificate Majority (which
approval shall not be unreasonably withheld), 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 ss.
10.1 and no notice of the appointment of any co-trustee or separate trustee
shall be required pursuant to ss. 10.3.
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 Master Servicer and the Owner Trustee acting jointly may
at any time accept the resignation of or remove any separate trustee or
co-trustee.
Any notice, request or other writing given to the Owner Trustee
shall be deemed to have been given to each of the then separate trustees and
co-trustees, as effectively as if given to each of them. Every instrument
appointing any separate trustee
31
or co-trustee shall refer to this Agreement and the conditions of this Article.
Each separate trustee and co-trustee, upon its acceptance of the trusts
conferred, shall be vested with the estates or property specified in its
instrument of appointment, either jointly with the Owner Trustee or separately,
as may be provided therein, subject to all the provisions of this Agreement,
specifically including every provision of this Agreement relating to the conduct
of, affecting the liability of, or affording protection to, the Owner Trustee.
Each such instrument shall be filed with the Owner Trustee and a copy thereof
given to the Master Servicer.
Any separate trustee or co-trustee may at any time appoint the Owner
Trustee, 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.
ARTICLE XI
Miscellaneous
Section 11.1. Supplements and Amendments. (a) This Agreement may be
amended from time to time by the parties hereto, by a written instrument signed
by each of them, without the consent of any of the Securityholders; provided
that an Opinion of Counsel for the Depositor (which Opinion of Counsel may, as
to factual matters, rely upon Officer's Certificates of the Depositor) is
addressed and delivered to the Owner Trustee, dated the date of any such
amendment, to the effect that the conditions precedent to any such amendment
have been satisfied and the Depositor shall have delivered to the Owner Trustee
an Officer's Certificate dated the date of any such Amendment, stating that the
Depositor reasonably believes that such Amendment will not have a material
adverse effect on the Securityholders.
(b) This Agreement may also be amended from time to time with the
consent of the Noteholders, evidencing not less than a majority of the
Outstanding Amount of the Notes, and the consent of the Certificateholders,
representing at least a 50% Percentage Interest, for which the Seller has not
delivered an Officer's Certificate stating that there is no material adverse
effect, 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 Securityholders; provided, however, that no such
amendment shall (i) reduce in any manner the amount of, or delay the timing of,
payments received that are required to be distributed on any Security without
the consent of the related Securityholder, or (ii) reduce the aforesaid
percentage of Securities the Holder of which are required to consent to any such
amendment, without the consent of the Holders of all such Certificates then
outstanding or cause any material adverse tax consequences to any
Certificateholders or Noteholders.
32
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.
It shall not be necessary for the consent of Certificateholders, the
Noteholders or the Indenture Trustee pursuant to this section to approve the
particular form of any proposed amendment or consent, but it shall be sufficient
if such consent shall approve the substance thereof. The manner of obtaining
such consents (and any other consents of Certificateholders provided for in this
Agreement or in any other Basic Document) and of evidencing the authorization of
the execution thereof by Certificateholders shall be subject to such reasonable
requirements as the Owner Trustee may prescribe. Promptly after the execution of
any amendment to the Certificate of Trust, the Owner Trustee shall cause the
filing of such amendment with the Secretary of State.
(c) The Owner Trustee shall not be required to enter into any
amendment to this Agreement which adversely affects its own rights, duties or
immunities under this Agreement.
Section 11.2. No Legal Title to Owner Trust Estate in
Certificateholders. The Certificateholders shall not have legal title to any
part of the related Series Trust Estate. The Certificateholders shall be
entitled to receive distributions with respect to their undivided ownership
interest therein only in accordance with Articles V and IX. No transfer, by
operation of law or otherwise, of any right, title or interest of the
Certificateholders to and in their ownership interest in the related Series
Trust Estate shall operate to terminate this Agreement or the trusts hereunder
or entitle any transferee to an accounting or to the transfer to it of legal
title to any part of the related Series Trust Estate.
Section 11.3. Limitations on Rights of Others. The provisions of
this Agreement are solely for the benefit of the Owner Trustee, the Depositor,
the Certificateholders, the Master Servicer and, to the extent expressly
provided herein, any Series Support Provider, the Indenture Trustee and the
Noteholders, and nothing in this Agreement, whether express or implied, shall be
construed to give to any other Person any legal or equitable right, remedy or
claim in the Owner Trust Estate or under or in respect of this Agreement or any
covenants, conditions or provisions contained herein.
Section 11.4. 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 personally delivered, delivered by overnight courier
or mailed first class mail or certified mail, in each case return receipt
requested, and shall be deemed to have been duly given upon receipt, if to the
Owner Trustee, addressed to the Corporate Trust Office; if to the Depositor,
addressed to Household Auto Receivables Corporation, 0000 Xxxx Xxxxxx Xxxxx, Xxx
Xxxxx, Xxxxxx 00000, with a copy to Household Finance Corporation, 0000 Xxxxxxx
Xxxx, Xxxxxxxx Xxxxxxx, Xxxxxxxx 00000, Attn: Treasurer; if to any Series
Support Provider, at the address of such Series Support Provider as set forth in
33
the related Series Supplement; 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 Holder 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 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. Assignments; Series Support Provider. This Agreement
shall inure to the benefit of and be binding upon the parties hereto and their
respective successors and permitted assigns. This Agreement shall also inure to
the benefit of any Series Support Provider for so long as a Support Default
shall not have occurred and be continuing. Without limiting the generality of
the foregoing, all covenants and agreements in this Agreement which confer
rights upon any Series Support Provider shall be for the benefit of and run
directly to any Series Support Provider, and any Series Support Provider shall
be entitled to rely on and enforce such covenants, subject, however, to the
limitations on such rights provided in this Agreement and the Basic Documents.
The Series Support Provider, if any, may disclaim any of its rights and powers
under this Agreement (but not its duties and obligations under any Series
Support Provider) upon delivery of a written notice to the Owner Trustee.
Section 11.8. Covenants of the Depositor. The Depositor will not at
any time institute against the Trust any bankruptcy proceedings under any United
States federal or state bankruptcy or similar law in connection with any
obligations relating to the Certificates, the Notes, this Agreement or any of
the Basic Documents.
Section 11.9. No Petition. The Owner Trustee (not in its individual
capacity but solely as Owner Trustee), by entering into this Agreement, each
Certificateholder, by accepting a Certificate, and the Indenture Trustee and
each Noteholder by accepting the benefits of this Agreement, hereby covenants
and agrees that they will not at any time institute against the Depositor, or
join in any institution against the Depositor 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
34
Agreement, any of the Basic Documents, any Series Supplement or any Series
Related Documents.
Section 11.10. No Recourse. Each Certificateholder by accepting a
Certificate acknowledges that such Certificateholder's Certificates represent
beneficial interests in the related Series Trust Estate only and do not
represent interests in or obligations of the Master Servicer, the Depositor, the
Owner Trustee, the Indenture Trustee, any Series Support Provider or any
Affiliate thereof and no recourse may be had against such parties or their
assets, except as may be expressly set forth or contemplated in this Agreement,
the Certificates, the Basic Documents, any Series Supplement or any Series
Related Documents.
Section 11.11. Headings. The headings of the various Articles and
Sections herein are for convenience of reference only and shall not define or
limit any of the terms or provisions hereof.
Section 11.12. GOVERNING LAW. THIS AGREEMENT SHALL BE CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF DELAWARE, WITHOUT REFERENCE TO ITS
CONFLICT OF LAW PROVISIONS, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE
PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
Section 11.13. Master Servicer. The Master Servicer is authorized to
prepare, or cause to be prepared, execute and deliver on behalf of the Trust all
such documents, reports, filings, instruments, certificates and opinions as it
shall be the duty of the Trust or Owner Trustee to prepare, file or deliver
pursuant to the Basic Documents, any Series Supplement or any Series Related
Documents. Upon written request, the Owner Trustee shall execute and deliver to
the Master Servicer a limited power of attorney appointing the Master Servicer
the Trust's agent and attorney-in-fact to prepare, or cause to be prepared,
execute and deliver all such documents, reports, filings, instruments,
certificates and opinions.
35
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.
[NAME OF OWNER TRUSTEE]
Owner Trustee
By:
-----------------------------
Name:
Title:
HOUSEHOLD AUTO RECEIVABLES
CORPORATION
Depositor
By:
-----------------------------
Name:
Title:
Acknowledged and Agreed:
HOUSEHOLD FINANCE CORPORATION
Master Servicer
By:
-------------------------------
Name:
Title:
[NAME OF INDENTURE TRUSTEE],
not in its individual capacity
but solely as Certificate Paying Agent
By:
-------------------------------
Name:
Title:
[Signature Page for Amended and Restated Trust Agreement]
EXHIBIT A
[FORM OF SERIES ______ TRUST CERTIFICATE]
NUMBER
HOUSEHOLD AUTOMOTIVE TRUST ______
SERIES ______ CERTIFICATE
SEE REVERSE FOR CERTAIN DEFINITIONS
THIS SERIES ______ CERTIFICATE HAS NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR THE SECURITIES
LAWS OF ANY STATE IN RELIANCE UPON EXEMPTIONS PROVIDED BY THE SECURITIES ACT AND
SUCH STATE SECURITIES LAWS. NO RESALE OR OTHER TRANSFER OF THIS CERTIFICATE MAY
BE MADE UNLESS SUCH RESALE OR TRANSFER (A) IS MADE IN ACCORDANCE WITH ss. 3.4 OF
THE AMENDED AND RESTATED TRUST AGREEMENT PERTAINING TO THE HOUSEHOLD AUTOMOTIVE
TRUST ______ (THE "AGREEMENT") AND (B) IS MADE (i) PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE SECURITIES ACT, (ii) IN A TRANSACTION EXEMPT
FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND APPLICABLE STATE
SECURITIES LAWS, (iii) TO THE SELLER OR (iv) TO A PERSON WHO THE TRANSFEROR
REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING OF
RULE 144A UNDER THE SECURITIES ACT THAT IS AWARE THAT THE RESALE OR OTHER
TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A AND (C) UPON THE SATISFACTION OF
CERTAIN OTHER REQUIREMENTS SPECIFIED IN THE AGREEMENT. NEITHER THE DEPOSITOR,
THE MASTER SERVICER, THE TRUST NOR THE OWNER TRUSTEE IS OBLIGATED TO REGISTER
THE SERIES ______ CERTIFICATES UNDER THE SECURITIES ACT OR ANY APPLICABLE STATE
SECURITIES LAWS.
---------------------------------
SERIES ______ CERTIFICATE
evidencing a beneficial ownership interest in the assets of the Trust relating
to the Series ______ Trust Estate, which includes a pool of motor vehicle retail
installment sale contracts sold to the Trust by Household Auto Receivables
Corporation.
(This Series ______ Certificate does not represent an interest in or obligation
of Household Auto Receivables Corporation or any of its Affiliates, except to
the extent described below.)
THIS CERTIFIES THAT Household Auto Receivables Corporation is the
registered owner of a nonassessable, fully-paid, beneficial ownership interest
representing a % Percentage Interest in the assets of Household Automotive Trust
______ (the "Trust") formed by Household Auto Receivables Corporation, a Nevada
corporation (the "Depositor") and the Series ______ Trust Estate.
A-1
OWNER TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned Agreement.
[NAME OF OWNER TRUSTEE]
not in its individual
capacity but solely as
Owner Trustee
by _______________________________________________________ Authenticating Agent
by _____________________________________________________________________________
Household Automotive Trust ______ (the "Trust"), was created
pursuant to a Trust Agreement, dated as of _______________ (the "Agreement"),
between the Depositor and [Name of Owner Trustee], as owner trustee (the "Owner
Trustee") as amended and restated as of _______________ and as supplemented by a
Series ______ Supplement dated as of _______________ (the "Series ______
Supplement"). A summary of certain of the pertinent provisions of the Agreement
and Series ______ Supplement is set forth below. To the extent not otherwise
defined herein, the capitalized terms used herein have the meanings assigned to
them in the Agreement and the Series ______ Supplement.
This certificate is one of the duly authorized certificates of Trust
of Household Automotive Trust ______ designated as Series ______ Certificates.
This Series ______ Certificate is issued under and is subject to the
terms, provisions and conditions of the Agreement and the Series ______
Supplement, to which Agreement the holder of this Series ______ Certificate by
virtue of the acceptance hereof assents and by which such holder is bound. The
property of the Trust consists of the Series ______ Trust Estate which includes
a pool of motor vehicle retail installment sale contracts (the "Receivables"),
all monies due thereunder on or after specified Cutoff Dates, security interests
in the vehicles financed thereby, certain bank accounts and the proceeds
thereof, proceeds from claims on certain insurance policies and certain other
rights under the Agreement and the Master Sale and Servicing Agreement and each
related Transfer Agreement, all right, to and interest of, the Depositor in and
to the Master Receivables Purchase Agreement dated as of _______________ between
Household Automotive Finance Corporation and the Depositor, the Master
Receivables Purchase Agreement dated as of _______________ between Household
Bank, f.s.b. and the Depositor and each Receivables Purchase Agreement
Supplement and all proceeds of the foregoing.
Series ______ Notes have been issued pursuant to an Indenture dated
as of _______________ (the "Indenture"), among the Trust, Household Finance
Corporation, as Master Servicer and [Name of Indenture Trustee], as Indenture
Trustee and the Series ______ Supplement.
Under the Series ______ Supplement, there will be distributed on the
17th day of each month or, if such 17th day is not a Business Day, the next
Business Day (the "Distribution Date"), commencing on _______________, to the
Person in whose name this Series ______
A-2
Certificate is registered at the close of business on the Business Day preceding
such Distribution Date (the "Record Date") such Series ______
Certificateholder's fractional undivided interest in any amount to be
distributed to Series ______ Certificateholders on such Distribution Date.
The holder of this Series ______ Certificate acknowledges and agrees
that its rights to receive distributions in respect of this Series ______
Certificate are subordinated to the rights of the Series ______ Noteholders as
described in the Master Sale and Servicing Agreement, the Indenture, the
Agreement and the Series ______ Supplement, as applicable.
Distributions on this Series ______ Certificate will be made as
provided in the Agreement by the Owner Trustee by wire transfer or check mailed
to the Series ______ 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 Agreement and
notwithstanding the above, the final distribution on this Series ______
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 Series
______ Certificate at the office or agency maintained for the purpose by the
Owner Trustee in the Corporate Trust Office.
Reference is hereby made to the further provisions of this Series
______ 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 Series ______ Certificate shall not entitle the holder hereof to any
benefit under the Agreement or the Master Sale and Servicing Agreement or be
valid for any purpose.
THIS SERIES ______ CERTIFICATE SHALL BE CONSTRUED IN ACCORDANCE WITH
THE LAWS OF THE STATE OF DELAWARE, WITHOUT REFERENCE TO ITS CONFLICT OF LAW
PROVISIONS, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER
SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
A-3
IN WITNESS WHEREOF, the Owner Trustee, on behalf of the Trust and
not in its individual capacity, has caused this Series ______ Certificate to be
duly executed.
HOUSEHOLD AUTOMOTIVE TRUST
------
By: [NAME OF OWNER TRUSTEE], not in its
individual capacity but solely as Owner Trustee
Dated: By:
-----------------------------------------
By:
----------------------------------------
Name:
Title:
A-4
(Reverse of Certificate)
The Series ______ Certificates do not represent an obligation of, or
an interest in, the Depositor, the Master Servicer, 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 or in
the Agreement, the Indenture, the Basic Documents or any Series Related
Documents. In addition, this Series ______ 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, as more specifically set
forth herein and in the Master Sale and Servicing Agreement. A copy of each of
the Master Sale and Servicing Agreement, the Agreement and the Series ______
Supplement may be examined during normal business hours at the principal office
of the Depositor, and at such other places, if any, designated by the Depositor,
by any Series ______ Certificateholder upon written request.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Series ______ Certificate is registrable
in the Certificate Register upon surrender of this Series ______ Certificate for
registration of transfer at the offices or agencies of the Certificate Registrar
maintained by the Owner Trustee in the Corporate Trust Office, 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 Series ______
Certificates in authorized denominations evidencing the same aggregate interest
in the Trust will be issued to the designated transferee. The initial
Certificate Registrar appointed under the Agreement is [Name of Owner Trustee].
The Certificates are issuable as registered Certificates in any
Percentage Interest not to exceed 100%. As provided in the Agreement and subject
to certain limitations therein set forth, Series ______ Certificates are
exchangeable for new Series ______ Certificates in authorized denominations
evidencing the same aggregate Percentage Interest, as requested by the holder
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 Series ______ Certificate is registered as the owner hereof for all
purposes, and none of the Owner Trustee, the Certificate Registrar nor any such
agent shall be affected by any notice to the contrary.
The Series ______ Certificates may not be acquired by or for the
account of (a) an employee benefit plan (as defined in ss. 3(3) of ERISA) that
is subject to the provisions of Title I of ERISA, (b) a plan (as defined in ss.
4975(e) (1) of the Code) that is subject to ss. 4975 of the Code or (c) any
entity whose underlying assets include plan assets by reason of such plan's
investment in the entity (each, a "Benefit Plan"). The Certificate Registrar
shall not register the transfer of a Series ______ Certificate unless the
transferee has delivered to the Owner Trustee a representation letter in form
and substance satisfactory to the Indenture Trustee to the effect that the
transferee is not, and is not acquiring the Series ______ Certificate for the
account of, a Benefit Plan.
A-5
The recitals contained herein shall be taken as the statements of
the Depositor or the Master Servicer, as the case may be, and the Owner Trustee
assumes no responsibility for the correctness thereof. The Owner Trustee makes
no representations as to the validity or sufficiency of this Series ______
Certificate or of any Receivable or related document.
Unless the certificate of authentication hereon shall have been
executed by an authorized officer of the Owner Trustee, by manual or facsimile
signature, this Series ______ Certificate shall not entitle the holder hereof to
any benefit under the Agreement or the Master Sale and Servicing Agreement or be
valid for any purpose.
A-6
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 of the
registered owner as it appears on the face of the within Certificate in every
particular, without alteration, enlargement or any change whatever. Such
signature must be guaranteed by an "eligible guarantor institution" meeting the
requirements of the Certificate Registrar, which requirements include membership
or participation in STAMP or such other "signature guarantee program" as may be
determined by the Certificate Registrar in addition to, or in substitution for,
STAMP, all in accordance with the Securities Exchange Act of 1934, as amended.
A-7
EXHIBIT B
[FORM OF CERTIFICATE OF TRUST]
CERTIFICATE OF TRUST
OF
HOUSEHOLD AUTOMOTIVE TRUST ______
THIS Certificate of Trust of Household Automotive Trust ______ (the
"Trust") is being duly executed and filed on behalf of the Trust by the
undersigned, as trustee, to form a business trust under the Delaware Business
Trust Act (12 Del. C. 3801 et seq.) (the "Act").
1. Name. The name of the business trust formed by this Certificate of
Trust is Household Automotive Trust ______.
2. Delaware Trustee. The name and business address of the trustee of the
Trust in the State of Delaware are [Name of Owner Trustee], [address], Attn:
_______________.
3. Series Trust. The Trust may issue series of beneficial interests,
having separate rights, powers or duties with respect to property or obligations
of the Trust, as provided in 12 Del. C. 3804 and 3806(b)(2), such that the
debts, liabilities, obligations and expenses incurred, contracted for or
otherwise existing with respect to a particular series shall be enforceable
against the assets of such series only, and not against the assets of the Trust
generally.
4. Effective Date. This Certificate of Trust shall be effective upon
filing.
IN WITNESS WHEREOF, the undersigned has duly executed this Certificate of
Trust in accordance with Section 3811(a)(1) of the Act.
[Name of Owner Trustee], not in its individual
capacity but solely as Trustee
By:
------------------------------------------
Name:
Title:
B-1
