EXHIBIT 10.122
TRUST AGREEMENT
among
ONYX ACCEPTANCE FINANCIAL CORPORATION,
as Depositor
BANKERS TRUST (DELAWARE),
as Owner Trustee
and
JPMORGAN CHASE BANK,
as Trust Agent
Dated as of March 15, 2002
ONYX ACCEPTANCE RESIDUAL FUNDING OWNER TRUST 2002-A
TABLE OF CONTENTS
PAGE
----
ARTICLE I - DEFINITIONS.......................................................................................... 1
Section 1.01 Capitalized Terms....................................................................... 1
Section 1.02 Other Definitional Provisions........................................................... 4
Section 1.03 Usage of Terms.......................................................................... 4
Section 1.04 Section References...................................................................... 4
Section 1.05 Accounting Terms........................................................................ 4
ARTICLE II - ORGANIZATION........................................................................................ 4
Section 2.01 Name.................................................................................... 4
Section 2.02 Office.................................................................................. 4
Section 2.03 Purposes and Powers..................................................................... 4
Section 2.04 Appointment of Owner Trustee............................................................ 5
Section 2.05 Initial Capital Contribution of Owner Trust Estate...................................... 5
Section 2.06 Declaration of Trust.................................................................... 5
Section 2.07 Title to Trust Estate................................................................... 6
Section 2.08 Situs of Trust.......................................................................... 6
Section 2.09 Representations and Warranties of the Depositor......................................... 6
Section 2.10 Federal Income Tax Allocations.......................................................... 8
Section 2.11 Separateness Covenants.................................................................. 8
ARTICLE III - TRUST CERTIFICATES AND TRANSFER OF INTERESTS....................................................... 8
Section 3.01 Initial Ownership....................................................................... 8
Section 3.02 The Trust Certificates and the Notes.................................................... 8
Section 3.03 Execution, Authentication and Delivery of Trust Certificates and Notes ................. 9
Section 3.04 Registration of Transfer and Exchange of Trust Certificates............................. 9
Section 3.05 Mutilated, Destroyed, Lost or Stolen Trust Certificates................................. 10
Section 3.06 Persons Deemed Holders.................................................................. 11
Section 3.07 Access to List of Holders' Names and Addresses.......................................... 11
Section 3.08 Maintenance of Office or Agency......................................................... 11
Section 3.09 Temporary Trust Certificates............................................................ 11
Section 3.10 Appointment of Paying Agent............................................................. 12
Section 3.11 Restrictions on Transfer of Trust Certificates.......................................... 12
ARTICLE IV - ACTIONS BY OWNER TRUSTEE............................................................................ 14
Section 4.01 Prior Notice to Holders with Respect to Certain Matters................................. 14
Section 4.02 Action by Holders with Respect to Certain Matters....................................... 15
Section 4.03 Action by Holders with Respect to Bankruptcy............................................ 15
Section 4.04 Restrictions on Holders' Power.......................................................... 15
Section 4.05 Majority Control........................................................................ 15
-i-
TABLE OF CONTENTS
(Continued)
Page
----
ARTICLE V - APPLICATION OF TRUST FUNDS; CERTAIN DUTIES........................................................... 16
Section 5.01 Establishment of Certificate Distribution Account....................................... 16
Section 5.02 Application of Trust Funds.............................................................. 16
Section 5.03 Method of Payment....................................................................... 16
Section 5.04 No Segregation of Monies; No Interest................................................... 17
Section 5.05 Accounting and Reports to Holders, the Internal Revenue Service
and Others.............................................................................. 17
Section 5.06 Signature on Returns; Tax Matters Partner............................................... 17
ARTICLE VI - AUTHORITY AND DUTIES OF OWNER TRUSTEE AND TRUST AGENT............................................... 18
Section 6.01 General Authority....................................................................... 18
Section 6.02 General Duties.......................................................................... 18
Section 6.03 Action Upon Instruction................................................................. 18
Section 6.04 No Duties Except as Specified in this Agreement or in Instructions...................... 19
Section 6.05 No Action Except Under Specified Documents or Instructions.............................. 20
Section 6.06 Restrictions............................................................................ 20
ARTICLE VII - CONCERNING THE OWNER TRUSTEE AND THE TRUST AGENT................................................... 20
Section 7.01 Acceptance of Trusts and Duties......................................................... 20
Section 7.02 Furnishing of Documents................................................................. 23
Section 7.03 Representations and Warranties.......................................................... 23
Section 7.04 Reliance; Advice of Counsel............................................................. 24
Section 7.05 Not Acting in Individual Capacity....................................................... 24
Section 7.06 Owner Trustee and Trust Agent Not Liable for Trust Certificates, Notes or
Underlying Certificates................................................................. 24
Section 7.07 Owner Trustee and Trust Agent May Own Trust Certificates and Notes...................... 25
ARTICLE VIII - COMPENSATION AND INDEMNIFICATION OF OWNER TRUSTEE AND TRUST AGENT................................. 25
Section 8.01 Owner Trustee's and Trust Agent's Fees and Expenses..................................... 25
Section 8.02 Indemnification......................................................................... 25
Section 8.03 Payments to the Owner Trustee or Trust Agent............................................ 25
ARTICLE IX - TERMINATION OF TRUST AGREEMENT...................................................................... 26
Section 9.01 Termination of Trust Agreement.......................................................... 26
ARTICLE X - SUCCESSOR OWNER TRUSTEES, ADDITIONAL OWNER TRUSTEE AND TRUST AGENT................................... 27
Section 10.01 Eligibility Requirements for Owner Trustee............................................. 27
-ii-
TABLE OF CONTENTS
(Continued)
Page
----
Section 10.02 Resignation or Removal of Owner Trustee................................................ 27
Section 10.03 Successor Owner Trustee................................................................ 28
Section 10.04 Merger or Consolidation of Owner Trustee............................................... 28
Section 10.05 Appointment of Co-Trustee or Separate Trustee.......................................... 28
Section 10.06 Appointment of Trust Agent............................................................. 29
ARTICLE XI - MISCELLANEOUS....................................................................................... 30
Section 11.01 Supplements and Amendments............................................................. 30
Section 11.02 Limitations on Rights of Others........................................................ 31
Section 11.03 Notices................................................................................ 31
Section 11.04 Severability of Provisions............................................................. 32
Section 11.05 Counterparts........................................................................... 32
Section 11.06 Successors and Assigns................................................................. 32
Section 11.07 No Petition............................................................................ 32
Section 11.08 No Recourse............................................................................ 32
Section 11.09 Certificates Nonassessable and Fully Paid.............................................. 33
Section 11.10 Headings............................................................................... 33
Section 11.11 Governing Law.......................................................................... 33
Section 11.12 Duties................................................................................. 33
EXHIBITS
Exhibit A - Form of Certificate of Trust
Exhibit B - Form of Trust Certificate
-iii-
This TRUST AGREEMENT, dated as of March 15, 2002 is among ONYX ACCEPTANCE
FINANCIAL CORPORATION, a Delaware corporation (the "DEPOSITOR"), BANKERS TRUST
(DELAWARE), a Delaware banking corporation, as owner trustee (the "OWNER
TRUSTEE"), and JPMORGAN CHASE BANK, a New York banking corporation, as agent of
the Owner Trustee for the limited purposes set forth herein (the "TRUST AGENT").
ARTICLE I
DEFINITIONS
Section 1.01 Capitalized Terms. Except as otherwise provided in this
Agreement, whenever used in this Agreement the following words and phrases,
unless the context otherwise requires, shall have the following meanings:
"ADMINISTRATION AGREEMENT" means the administration agreement, dated as of
March 15, 2002 among the Trust, the Depositor, the Indenture Trustee, the Trust
Agent and Onyx, as administrator.
"ADMINISTRATOR" means the Person acting as "Administrator" under the
Administration Agreement.
"AGREEMENT" means this Trust Agreement, as the same may be amended and
supplemented from time to time.
"APPLICANTS" shall have the meaning assigned to such term in Section 3.07.
"BENEFIT PLAN" means (i) an employee benefit plan (as such term is defined
in Section 3(3) of ERISA) that is subject to the provisions of Title I of ERISA,
(ii) a plan described in Section 4975(e)(1) of the Code or (iii) any entity
whose underlying assets include plan assets by reason of a plan's investment in
the entity.
"BUSINESS TRUST STATUTE" means Chapter 38 of Title 12 of the Delaware
Code, 12 Del. X.xx. 3801, et seq., as the same may be amended from time to time.
"CERTIFICATE DISTRIBUTION ACCOUNT" means the account established and
maintained as such pursuant to Section 5.01.
"CERTIFICATE OF TRUST" means the Certificate of Trust filed for the Trust
pursuant to Section 3810(a) of the Business Trust Statute, substantially in the
form of Exhibit A hereto.
"CERTIFICATE REGISTER" and "CERTIFICATE REGISTRAR" mean the register
maintained and the registrar (or any successor thereto) appointed pursuant to
Section 3.04.
"CLOSING DATE" means March 15, 2002.
"CODE" means the Internal Revenue Code of 1986, as amended, and Treasury
Regulations promulgated thereunder.
"COMMISSION" means the United States Securities and Exchange Commission.
"DEPOSITOR" means Onyx Acceptance Financial Corporation in its capacity as
depositor hereunder, and its successors.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended.
"EXCHANGE ACT" means the Securities Exchange Act of 1934, as amended.
"HOLDER" means, the Person in whose name a Trust Certificate is registered
in the Certificate Register.
"GRANT" shall have the meaning assigned to such term in Section 2.03.
"INDENTURE" means the indenture dated as of February 20, 2002 between the
Trust, as Issuer, and JPMorgan Chase Bank, as Indenture Trustee.
"NOTEHOLDERS" means the Person in whose name a Note is registered pursuant
to the terms of the Indenture.
"NOTES" means the notes issued pursuant to the Indenture.
"ONYX" means Onyx Acceptance Corporation, and its successors.
"OWNER TRUSTEE" means Bankers Trust (Delaware), a Delaware banking
corporation, not in its individual capacity but solely as owner trustee under
this Agreement, and any successor Owner Trustee hereunder.
"OWNER TRUSTEE CORPORATE TRUST OFFICE" means the office of the Owner
Trustee at which its corporate trust business shall be administered, which
initially shall be E.A. Delle Donne Corporate Center, 0000 Xxxxxx Xxxx, Xxxxx
000, Xxxxxxxxxx, Xxxxxxxx 00000-0000, Attention: Corporate Trust Administration
Department, or such other office at such other address as the Owner Trustee may
designate from time to time by notice to the Holders of the Trust Certificates
and the Depositor.
"PAYING AGENT" means the Trust Agent or any successor in interest thereto
or any other paying agent or co-paying agent appointed pursuant to Section 3.10
and authorized by the Issuer to make payments to and distributions from the
Certificate Distribution Account.
"PERCENTAGE INTEREST" means with respect to each Trust Certificate the
percentage portion of the Residual Interest evidenced thereby as stated on the
face of such Trust Certificate.
-2-
"PERSON" means a legal person, including any individual, corporation,
estate, partnership, joint venture, association, joint stock company, trust,
unincorporated organization or government or any agency or political subdivision
thereof.
"PROSPECTIVE OWNER" has the meaning set forth in Section 3.11(a).
"RECORD DATE" means with respect to any Payment Date, the day immediately
preceding such Payment Date.
"RESIDUAL INTEREST" means the residual interest in the Trust, which
represents the right to receive the amount remaining, if any, after all Notes
have been paid in full.
"RESPONSIBLE OFFICER" means, with respect to the Owner Trustee, any
officer within the Owner Trustee Corporate Trust Office, and with respect to the
Trust Agent, any officer within the Trust Agent Office, including any Vice
President, assistant secretary or other officer or assistant officer of the
Owner Trustee or the Trust Agent, as the case may be, customarily performing
functions similar to those performed by the people who at such time shall be
officers and has direct responsibility for the administration of this Agreement.
"SALE AND ASSIGNMENT AGREEMENT" means the Sale and Assignment Agreement,
dated as of March 15, 2002 among the Trust, as Issuer, the Depositor, as Seller,
the Indenture Trustee and the Trust Agent as the same may be amended or
supplemented from time to time.
"SECRETARY OF STATE" means the Secretary of State of the State of
Delaware.
"SELLER" means Onyx Acceptance Financial Corporation, in its capacity as
seller under the Sale and Assignment Agreement, and its successors.
"TREASURY REGULATIONS" means regulations, including proposed or temporary
regulations, promulgated under the Code. References herein to specific
provisions of proposed or temporary regulations shall include analogous
provisions of final Treasury Regulations or other successor Treasury
Regulations.
"TRUST" means the trust established by this Agreement.
"TRUST AGENT" means JPMorgan Chase Bank, a New York banking corporation,
not in its individual capacity but solely as agent of the Owner Trustee under
this Agreement, and any successor Trust Agent hereunder.
"TRUST AGENT OFFICE" means the office of the Trust Agent at 000 Xxxx 00xx
Xxxxxx, 00xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Institutional Trust
Services Onyx Residual Funding Trust 2002- A or such other office at such other
address as the Trust Agent may designate from time to time by notice to the
Holders of the Trust Certificates and the Depositor.
-3-
"TRUST CERTIFICATE" means an instrument substantially in the form attached
as Exhibit B hereto and evidencing a Percentage Interest in the Residual
Interest.
"TRUST ESTATE" means all right, title and interest of the Trust in and to
the Collateral.
"UCC" means the Uniform Commercial Code as in effect in the state of New
York.
Section 1.02 Other Definitional Provisions. Capitalized terms used that
are not otherwise defined herein shall have the meanings ascribed thereto in the
Indenture.
Section 1.03 Usage of Terms. With respect to all terms in this Agreement,
the singular includes the plural and the plural the singular; words importing
any gender include the other genders; references to "writing" include printing,
typing, lithography and other means of reproducing words in a visible form;
references to agreements and other contractual instruments include all
amendments, modifications and supplements thereto or any changes therein entered
into in accordance with their respective terms and not prohibited by this
Agreement; references to Persons include their permitted successors and assigns;
and the term "including" means "including without limitation".
Section 1.04 Section References. All section references, unless otherwise
indicated, shall be to Sections in this Agreement.
Section 1.05 Accounting Terms. All accounting terms used but not
specifically defined herein shall be construed in accordance with generally
accepted accounting principles in the United States.
ARTICLE II
ORGANIZATION
Section 2.01 Name. The Trust created hereby shall be known as Onyx
Acceptance Residual Funding Owner Trust 2002-A in which name the Owner Trustee
may conduct the activities of the Trust, make and execute contracts and other
instruments on behalf of the Trust and xxx and be sued, and in which name the
Owner Trustee may perform its duties hereunder.
Section 2.02 Office. The office of the Trust shall be in care of the Owner
Trustee at the Owner Trustee Corporate Trust Office or at such other address in
Delaware as the Owner Trustee may designate by written notice to the Holders or
the Depositor.
Section 2.03 Purposes and Powers. The sole purpose of the Trust is to hold
or conserve the Trust Estate and collect and disburse the periodic income
therefrom for the use and benefit of the Holders, and in furtherance of such
purpose to engage in the following ministerial activities:
(i) to issue the Notes pursuant to the Indenture, to sell the Notes
and to issue Trust Certificates pursuant to this Agreement;
-4-
(ii) with the proceeds of the sale of the Notes, to purchase the
Underlying Certificates, and to pay the organizational, start-up and
transactional expenses of the Trust and to pay the balance to the
Depositor pursuant to the Sale and Assignment Agreement;
(iii) to assign, grant, transfer, pledge, mortgage and convey
("GRANT") the Trust Estate and the other Collateral (as defined in the
Indenture) pursuant to the Indenture and to hold, manage and distribute to
the Holders pursuant to this Agreement any portion of the Trust Estate or
the other Collateral released from the lien of, and remitted to the Trust
pursuant to, the Indenture;
(iv) to enter into and perform its obligations under the Basic
Documents to which it is to be a party;
(v) subject to compliance with the Basic Documents, to engage in
such other activities as may be required in connection with conservation
of the Trust Estate and the making of distributions to the Holders and the
Noteholders;
(vi) to purchase, for cash, furniture or computer equipment to be
used in connection with the foregoing activities;
(vii) to engage in those activities, including entering into
agreements, that are necessary to accomplish the foregoing or are
incidental thereto or connected therewith.
The Trust is hereby authorized to engage in the foregoing activities. Other than
pursuant to this Agreement, or in connection with or incidental to the
provisions or purposes of this Agreement, the Trust shall not (i) issue debt or
otherwise borrow money, (ii) merge or consolidate with any other entity,
reorganize, liquidate or transfer all or substantially all of its assets to any
other entity, or (iii) otherwise engage in any activity or exercise any power
not provided for in this Agreement or the Basic Documents.
Section 2.04 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 and in the Business
Trust Statute, and the Owner Trustee hereby accepts such appointment. The Owner
Trustee is hereby authorized and directed to file the Certificate of Trust with
the Secretary of State.
Section 2.05 Initial Capital Contribution of Owner Trust Estate. The
Depositor hereby sells, assigns, transfers, conveys and sets over to the Owner
Trustee, as of the date hereof, the sum of $1.00. The Owner Trustee hereby
acknowledges receipt in trust from the Depositor, as of the date hereof, of the
foregoing contribution, which shall constitute the initial Trust Estate and
shall be deposited in the Certificate Distribution Account. The Depositor shall
pay organizational expenses of the Trust as they may arise or shall, upon the
request of the Owner Trustee or the Trust Agent, as applicable, promptly
reimburse the Owner Trustee and the Trust Agent, respectively, for any such
expenses paid by the Owner Trustee or the Trust Agent, as applicable.
-5-
Section 2.06 Declaration of Trust. The Owner Trustee hereby declares that
it will hold the Trust Estate in trust upon and subject to the conditions set
forth herein for the sole purpose of conserving the Trust Estate and collecting
and disbursing the periodic income therefrom for the use and benefit of the
Holders, subject to the obligations of the Trust under the Basic Documents. 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, on and after the
Closing Date, (i) so long as there is a sole Holder of a Trust Certificate, the
Trust shall be disregarded as an entity separate from the sole Trust Certificate
Holder and (ii) if there is more than one Trust Certificate Holder, the Trust
shall be treated as a partnership, with the assets of the partnership being the
Underlying Certificates and other assets held by the Trust and with the partners
of the partnership being the Holders of the Trust Certificates, and the Notes
shall be treated as debt of the partnership. The Trust shall not elect to be
treated as an association under Treasury Regulation Section 301.7701-3(a) for
federal income tax purposes. The parties agree that, unless otherwise required
by appropriate tax authorities, 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 provided in the second preceding sentence.
Effective as of the date hereof, the Owner Trustee shall have all rights, powers
and duties set forth herein and in the Business Trust Statute for the sole
purpose and to the extent necessary to accomplish the purposes of the Trust as
set forth in Section 2.03.
Section 2.07 Title to Trust Estate. Subject to the Indenture, legal title
to all the 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 Trust Estate to be vested in a trustee or trustees, in which
case title shall be deemed to be vested in the Owner Trustee and/or a separate
trustee, as the case may be.
The Holders shall not have legal title to any part of the Trust Estate.
The Holders shall be entitled to receive distributions with respect to their
undivided ownership interest therein only in accordance with Articles V and IX
of this Agreement. No transfer, by operation of law or otherwise, of any right,
title or interest of the Holders to and in their ownership interest in the 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 Trust Estate.
Section 2.08 Situs of Trust. The Trust will be located and administered in
the State of Delaware or the State of New York. All bank accounts maintained on
behalf of the Trust shall be located in the State of California, the State of
Delaware or the State of New York. 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 from having employees within or without the State
of Delaware. Payments will be received by the Trust only in California, Delaware
or New York and payments will be made by the Trust only from California,
Delaware or New York. The only office of the Trust will be at the Owner Trustee
Corporate Trust Office.
Section 2.09 Representations and Warranties of the Depositor.
-6-
(a) The Depositor hereby represents and warrants to the Owner Trustee
that:
(i) The Depositor is duly organized and validly existing as a
corporation organized and existing and in good standing under the laws of
the State of Delaware, with power and authority to own its properties and
to conduct its business and had at all relevant times, and has, power,
authority and legal right to acquire and own the Underlying Certificates.
(ii) The Depositor is duly qualified to do business as a foreign
corporation in good standing and has obtained all necessary licenses and
approvals in all jurisdictions in which the ownership or lease of property
or the conduct of its business requires such qualifications.
(iii) The Depositor has the power and authority to execute and
deliver this Agreement and to carry out its terms; the Depositor has full
power and authority to sell and assign the property to be sold and
assigned to and deposited with the Owner Trustee on behalf of the Trust as
part of the Trust Estate and has duly authorized such sale and assignment
and deposit with the Owner Trustee on behalf of the Trust by all necessary
corporate action. The execution, delivery and performance of this
Agreement have been duly authorized by the Depositor by all necessary
corporate action. The Depositor has duly executed and delivered this
Agreement, and this Agreement constitutes the legal, valid and binding
obligation of the Depositor enforceable against the Depositor in
accordance with its terms.
(iv) The consummation of the transactions contemplated by this
Agreement and the fulfillment of the terms hereof do not conflict with,
result in the breach of any of the terms and provisions of, nor constitute
(with or without notice or lapse of time) a default under, the certificate
of incorporation or bylaws of the Depositor, or any indenture, agreement
or other instrument to which the Depositor is a party or by which it is
bound; nor result in the creation or imposition of any lien upon any of
the properties of the Depositor pursuant to the terms of any such
indenture, agreement or other instrument (other than pursuant to the Basic
Documents); nor violate any law or 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.
(v) There are no proceedings or investigations pending, or to the
Depositor's best knowledge threatened, before any court, regulatory body,
administrative agency or other governmental instrumentality having
jurisdiction over the Depositor or its properties: (A) asserting the
invalidity of this Agreement or any of the other Basic Documents or the
Trust Certificates, (B) seeking to prevent the issuance of the Trust
Certificates or the consummation of any of the transactions contemplated
by this Agreement or any of the other Basic Documents, (C) seeking any
determination or ruling that might materially and adversely affect the
performance by the Depositor of its obligations under, or the validity or
enforceability of, this Agreement, any of the other Basic Documents or the
Trust Certificates or (D) involving the Depositor which might materially
and adversely affect the federal income tax or other federal, state or
local tax attributes of the Trust Certificates.
-7-
Section 2.10 Federal Income Tax Allocations.
(a) Net income of the Trust for any month, as determined for federal
income tax purposes (and each item of income, gain, loss and deduction entering
into the computation thereof), shall be allocated among the Holders in
proportion to the Percentage Interest of each such Holder.
(b) Net losses of the Trust, if any, for any calendar month as determined
for federal income tax purposes (and each item of income, gain, loss and
deduction entering into the computation thereof) shall be allocated to the
Holders. Any indebtedness allocated pursuant to Treasury Regulation
ss.1.752-3(a)(3) shall be allocated to the Trust Certificates. The Depositor is
authorized to modify the allocations in this paragraph if necessary or
appropriate, in its sole discretion, for the allocations to fairly reflect the
income, gain, loss and deduction to the Depositor or to the Holders, or as
otherwise required by the Code.
Section 2.11 Separateness Covenants. So long as the Notes are outstanding,
the Trust shall and the Owner Trustee shall cause the Trust to (i) maintain
books and records and bank accounts separate from those of any other Person;
(ii) maintain its assets in such a manner that it is not costly or difficult to
segregate, identify, or ascertain such assets; (iii) observe all trust
procedures required by this Trust Agreement and under Delaware Law; (iv) hold
itself out to creditors and the public as a legal entity separate and distinct
from any other Person; (v) prepare separate tax returns and financial
statements, or if part of a consolidated group, then the Trust will be shown as
a separate member of such group; (vi) allocate and charge fairly and reasonably
any overhead shared with Affiliates; (vii) transact all business with Affiliates
on an arm's-length basis and pursuant to enforceable agreements; (viii) conduct
business in its own name, and use separate stationery, invoices, and checks
separate from that of the Depositor or any Affiliate; (ix) not commingle its
assets or funds with those of any other Person; and (x) not assume, guarantee,
or pay the debts or obligations of any other Person.
ARTICLE III
TRUST CERTIFICATES AND TRANSFER OF INTERESTS
Section 3.01 Initial Ownership. Upon the formation of the Trust by the
contribution by the Depositor pursuant to Section 2.05 and until the issuance of
the Trust Certificates, the Depositor shall be the sole beneficiary of the
Trust.
Section 3.02 The Trust Certificates and the Notes.
(a) The Trust Certificates shall not be issued with a principal amount.
The Trust Certificates shall be executed by the Owner Trustee on behalf of the
Trust by manual or facsimile signature of an authorized officer of the Owner
Trustee, and authenticated by the Trust Agent by the manual or facsimile
signature of an authorized officer of the Trust Agent and shall be deemed to
have been validly issued when so executed and authenticated. Trust Certificates
bearing the manual or facsimile signatures of individuals who were, at the time
when such signatures were affixed, authorized to sign on behalf of the Owner
Trustee or the Trust Agent shall be validly issued by the Trust, notwithstanding
that such individuals or any of them
-8-
have ceased to be so authorized prior to the execution, authentication and
delivery of such Trust Certificates or did not hold such offices at the date of
such Trust Certificates. All Trust Certificates shall be dated the date of their
authentication.
(b) The Notes shall be executed by the Owner Trustee on behalf of the
Trust by manual or facsimile signature of an authorized officer of the Owner
Trustee, and shall be authenticated as provided in the Indenture. Notes bearing
the manual or facsimile signature of an individual who was, at the time when
such signature was affixed, authorized to sign on behalf of the Owner Trustee
shall be deemed to have been validly executed by the Trust, notwithstanding that
such individual has ceased to be so authorized prior to the execution and
delivery of such Notes or did not hold such office at the date of such Notes.
Section 3.03 Execution, Authentication and Delivery of Trust Certificates
and Notes. The Owner Trustee shall cause to be executed, authenticated and
delivered upon the order of the Depositor, in exchange for the Underlying
Certificates and the other assets of the Trust, simultaneously with the sale,
assignment and transfer to the Trust of the Underlying Certificates, and such
other assets, (a) the Trust Certificates representing 100% of the Percentage
Interests of the Residual Interest, evidencing the entire ownership of the
Trust, and (b) Notes executed by the Trust in aggregate principal amount of
$75,000,000. The Owner Trustee is hereby authorized to direct, on behalf of the
Trust, the Indenture Trustee to authenticate and deliver the Notes upon the
order of the Depositor. No Trust Certificate shall entitle its Holder to any
benefit under this Agreement, or be valid for any purpose, unless there appears
on such Trust Certificate a certificate of authentication substantially in the
form set forth in the form of Trust Certificate attached hereto as Exhibit B,
executed by the Trust Agent or another authenticating agent of the Owner
Trustee, by manual or facsimile signature, and such certificate upon any Trust
Certificate shall be conclusive evidence, and the only evidence, that such Trust
Certificate has been duly authenticated and delivered hereunder. Upon issuance,
authorization and delivery pursuant to the terms hereof, the Trust Certificates
will be entitled to the benefits of this Agreement.
Section 3.04 Registration of Transfer and Exchange of Trust Certificates.
(a) The Certificate Registrar shall keep or cause to be kept, a
Certificate Register, subject to such reasonable regulations as it may
prescribe. The Certificate Register shall provide for the registration of Trust
Certificates and transfers and exchanges of Trust Certificates as provided
herein. The Trust Agent, as agent for the Trust, is hereby initially appointed
Certificate Registrar for the purpose of registering Trust Certificates and
transfers and exchanges of Trust Certificates as herein provided. In the event
that, subsequent to the Closing Date, the Trust Agent notifies the Administrator
that the Trust Agent is unable to act as Certificate Registrar, the
Administrator shall appoint another bank or trust company, having an office or
agency located in The City of New York, agreeing to act in accordance with the
provisions of this Agreement applicable to it, and otherwise acceptable to the
Depositor, to act as successor Certificate Registrar hereunder.
(b) Upon surrender for registration of transfer of any Trust Certificate
at the office of the Certificate Registrar, the Owner Trustee shall execute,
authenticate and deliver (or shall cause the Trust Agent, as its authenticating
agent, to authenticate and deliver), in the name of the designated transferee or
transferees, one or more new Trust Certificates in authorized denominations of a
like Percentage Interest.
-9-
(c) At the option of a Holder of a Trust Certificate, Trust Certificates
may be exchanged for other Trust Certificates in authorized denominations of a
like Percentage Interest, upon surrender of the Trust Certificates to be
exchanged at the office of the Certificate Registrar. Whenever any Trust
Certificates are so surrendered for exchange, the Owner Trustee on behalf of the
Trust shall execute, authenticate and deliver (or shall cause the Trust Agent,
as its authenticating agent, to authenticate and deliver) the Trust Certificates
that the Holder making the exchange is entitled to receive. Every Trust
Certificate presented or surrendered for registration of transfer or exchange
shall be accompanied by a written instrument of transfer in form satisfactory to
the Trust Agent and the Certificate Registrar duly executed by the Holder
thereof or his attorney duly authorized in writing. In addition each Trust
Certificate presented or surrendered for registration of transfer and exchange
must be accompanied by a letter from the prospective Holder certifying as to the
representations set forth in Section 3.11(a).
(d) No service charge shall be made for any registration of transfer or
exchange of Trust Certificates, but the Owner Trustee or, on its behalf, the
Trust Agent, 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 Trust Certificates.
(e) All Trust Certificates surrendered for registration of transfer or
exchange, if surrendered to any agent of the Owner Trustee under this Agreement,
shall be delivered to the Trust Agent and promptly canceled by it, or, if
surrendered to the Trust Agent, shall be promptly canceled by it, and no Trust
Certificates shall be issued in lieu thereof except as expressly permitted by
any of the provisions of this Agreement. The Trust Agent shall dispose of
canceled Trust Certificates in accordance with the normal industry practice.
Section 3.05 Mutilated, Destroyed, Lost or Stolen Trust Certificates. If
(a) the Certificate Registrar receives evidence to its satisfaction of the
destruction, loss or theft of any Trust Certificate and the Certificate
Registrar and the Trust Agent receive such security or indemnity as may be
required by them to hold the Certificate Registrar and the Trust Agent harmless,
then, in the absence of notice to the Certificate Registrar or the Trust Agent
that such Trust Certificate has been acquired by a bona fide purchaser and the
requirements of Section 8-406 of the UCC are met and subject to Section 8-405 of
the UCC, the Owner Trustee on behalf of the Trust shall execute and the Trust
Agent, as its authenticating agent, shall authenticate and deliver, in exchange
for or in lieu of any such mutilated, destroyed, lost or stolen Trust
Certificate, a new Trust Certificate of like tenor and Percentage Interest. In
connection with the issuance of any new Trust Certificate under this Section,
the Owner Trustee or, on its behalf, the Trust Agent, may require the payment by
the Holder of a sum sufficient to cover any tax or other governmental charge
that may be imposed in relation thereto. Any duplicate Trust Certificate issued
pursuant to this Section shall constitute complete and indefeasible evidence of
ownership in the Trust, as if originally issued, whether or not the lost, stolen
or destroyed Trust Certificate shall be found at any time.
Section 3.06 Persons Deemed Holders. Prior to due presentation of a Trust
Certificate for registration of transfer, the Owner Trustee, the Trust Agent,
the Certificate Registrar, any Paying Agent and any of their respective agents
may treat the Person in whose name any Trust Certificate is registered as the
owner of such Trust Certificate for the purpose of receiving distributions
pursuant to Section 5.02 and for
-10-
all other purposes whatsoever, and none of the Owner Trustee, the Trust Agent,
the Certificate Registrar, any Paying Agent or any of their respective agents
shall be affected by any notice to the contrary.
Section 3.07 Access to List of Holders' Names and Addresses. The Trust
Agent shall furnish or cause to be furnished to the Depositor, within 15 days
after receipt by the Trust Agent of a written request therefor from the
Depositor, a list, in such form as the Depositor may reasonably require, of the
names and addresses of the Holders as of the most recent Record Date. If one or
more Holders of Trust Certificates evidencing not less than 25% of the
Percentage Interests of the Trust Certificates (hereinafter referred to as
"APPLICANTS"), apply in writing to the Trust Agent, and such application states
that the Applicants desire to communicate with other Holders with respect to
their rights hereunder or under the Trust Certificates and such application is
accompanied by a copy of the communication that such Applicants propose to
transmit, then the Trust Agent shall, within five Business Days after the
receipt of such application, afford such Applicants access, during normal
business hours, to the current list of Holders. Each Holder, by receiving and
holding a Trust Certificate, agrees with the Depositor, the Owner Trustee and
the Trust Agent that none of the Depositor, the Owner Trustee or the Trust Agent
shall be held accountable by reason of the disclosure of any such information as
to its name and address hereunder, regardless of the source from which such
information was derived.
Section 3.08 Maintenance of Office or Agency. The Trust Agent shall
maintain in the City of New York an office or offices or agency or agencies
where Trust Certificates may be surrendered for registration of transfer or
exchange and where notices and demands to or upon the Trust Agent in respect of
the Trust Certificates and the Basic Documents may be served. The Trust Agent
hereby designates the office of JPMorgan Chase Bank at the address provided
under the definition of the term "TRUST AGENT OFFICE" as its office for such
purposes. The Trust Agent shall give prompt written notice to the Owner Trustee
and the Depositor of any change in the location of the Certificate Register or
any such office or agency.
Section 3.09 Temporary Trust Certificates. Pending the preparation of
definitive Trust Certificates, the Owner Trustee, on behalf of the Trust, may
execute, authenticate and deliver, temporary Trust Certificates that are
printed, lithographed, typewritten, mimeographed or otherwise produced, in any
authorized denomination, substantially of the tenor of the definitive Trust
Certificates in lieu of which they are issued. If temporary Trust Certificates
are issued, the Depositor will cause definitive Trust Certificates to be
prepared without unreasonable delay. After the preparation of definitive Trust
Certificates, the temporary Trust Certificates shall be exchangeable for
definitive Trust Certificates upon surrender of the temporary Trust Certificates
at the office or agency to be maintained as provided in Section 3.08, without
charge to the Holder. Upon surrender for cancellation of any one or more
temporary Trust Certificates, the Owner Trustee shall execute, authenticate and
deliver (or shall cause the Trust Agent, as its authenticating agent, to
authenticate and deliver) in exchange therefor a like Percentage Interest of
definitive Trust Certificates in authorized denominations. Until so exchanged,
the temporary Trust Certificates shall in all respects be entitled to the same
benefits hereunder as definitive Trust Certificates.
-11-
Section 3.10 Appointment of Paying Agent. The Owner Trustee, on behalf of
the Trust, hereby appoints the Trust Agent as Paying Agent under this Agreement.
The Paying Agent shall make distributions to Holders from the Certificate
Distribution Account pursuant to Section 5.02 hereof and shall report the
amounts of such distributions to the Owner Trustee. The Paying Agent shall have
the revocable power to withdraw funds from the Certificate Distribution Account
for the purpose of making the distributions referred to above. The Owner Trustee
on behalf of the Trust may revoke such power and remove the Paying Agent if the
Owner Trustee is directed in writing to do so by the Administrator. Each Paying
Agent shall be permitted to resign as Paying Agent upon 30 days' written notice
to the Trust. In the event that the Trust Agent shall no longer be the Paying
Agent, the Administrator shall appoint a successor to act as Paying Agent (which
shall be a bank or trust company). The Administrator shall cause such successor
Paying Agent or any additional Paying Agent appointed by the Administrator to
execute and deliver to the Trust an instrument in which such successor Paying
Agent or additional Paying Agent shall agree with the Trust that, as Paying
Agent, such successor Paying Agent or additional Paying Agent will hold all
sums, if any, held by it for payment to the Holders in trust for the benefit of
the Holders entitled thereto until such sums shall be paid to such Holders. The
Paying Agent shall return all unclaimed funds to the Trust and upon removal of a
Paying Agent such Paying Agent shall also return all funds in its possession to
the Trust. The provisions of Sections 7.01, 7.03, 7.04, 8.01 and 8.02 shall
apply to the Trust Agent also in its role as Paying Agent, for so long as the
Trust Agent shall act as Paying Agent and, to the extent applicable, to any
other paying agent appointed hereunder. Any reference in this Agreement to the
Paying Agent shall include any co-paying agent unless the context requires
otherwise. Notwithstanding anything herein to the contrary, the Trust Agent and
the Paying Agent shall be the same entity as the Indenture Trustee under the
Indenture and the Sale and Assignment Agreement.
Section 3.11 Restrictions on Transfer of Trust Certificates.
(a) Each prospective purchaser and any subsequent transferee of a Trust
Certificate (each, a "PROSPECTIVE OWNER"), other than the Depositor, by virtue
of its acceptance thereof, shall represent and warrant to the Owner Trustee, the
Trust Agent and the Certificate Registrar and any of their respective successors
that:
(i) Such Person is (A) a "QUALIFIED INSTITUTIONAL BUYER" as defined
in Rule 144A under the Securities Act of 1933, as amended (the "Securities
Act"), is aware that the seller of the Trust Certificates may be relying
on the exemption from the registration requirements of the Securities Act
provided by Rule 144A and is acquiring such Trust Certificate for its own
account or for the account of one or more qualified institutional buyers
for whom it is authorized to act, or (B) a Person involved in the
organization or operation of the Trust or an affiliate of such Person
within the meaning of Rule 3a-7 of the Investment Company Act of 1940, as
amended (including, but not limited to, the Depositor and Onyx Acceptance
Corporation).
(ii) Such Person understands that the Trust Certificates have not
been and will not be registered under the Securities Act and may be
offered, sold, pledged or otherwise transferred only to a person whom the
seller reasonably believes is (A) a qualified institutional buyer (as such
term is defined in Rule 144A under the Securities Act) or (B) a Person
involved in the organization or operation of the Trust or an affiliate of
such Person, in a transaction meeting the requirements of
-12-
Rule 144A under the Securities Act and in accordance with any applicable
securities laws of any state of the United States.
(iii) Such person understands that the Trust Certificates bear a
legend to the following effect:
THE RESIDUAL INTEREST IN THE TRUST REPRESENTED BY THIS TRUST
CERTIFICATE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR ANY
STATE SECURITIES LAWS. THIS TRUST CERTIFICATE MAY BE DIRECTLY OR
INDIRECTLY OFFERED OR SOLD OR OTHERWISE DISPOSED OF (INCLUDING
PLEDGED) BY THE HOLDER HEREOF ONLY TO (i) A "QUALIFIED INSTITUTIONAL
BUYER" AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT, IN A
TRANSACTION THAT IS REGISTERED UNDER THE SECURITIES ACT AND
APPLICABLE STATE SECURITIES LAWS OR THAT IS EXEMPT FROM THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT PURSUANT TO RULE
144A OR (ii) A PERSON INVOLVED IN THE ORGANIZATION OR OPERATION OF
THE TRUST OR AN AFFILIATE OF SUCH A PERSON WITHIN THE MEANING OF
RULE 3a-7 OF THE INVESTMENT COMPANY ACT OF 1940, AS AMENDED
(INCLUDING, BUT NOT LIMITED TO ONYX ACCEPTANCE FINANCIAL CORPORATION
AND ONYX ACCEPTANCE CORPORATION) IN A TRANSACTION THAT IS REGISTERED
UNDER THE SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS OR
THAT IS EXEMPT FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES
ACT AND SUCH LAWS. NO PERSON IS OBLIGATED TO REGISTER THIS TRUST
CERTIFICATE UNDER THE SECURITIES ACT OR ANY STATE SECURITIES LAWS.
NO TRANSFER OF THIS TRUST CERTIFICATE OR ANY BENEFICIAL
INTEREST THEREIN SHALL BE MADE TO ANY PERSON THAT IS (i) AN EMPLOYEE
BENEFIT PLAN (AS DEFINED IN SECTION 3(3) OF THE EMPLOYEE RETIREMENT
INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA")) THAT IS SUBJECT
TO THE PROVISIONS OF TITLE I OF ERISA, (ii) A PLAN DESCRIBED IN
SECTION 4975(e)(1) OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED,
OR (iii) ANY ENTITY, INCLUDING AN INSURANCE COMPANY SEPARATE ACCOUNT
OR GENERAL ACCOUNT, WHOSE UNDERLYING ASSETS INCLUDE PLAN ASSETS BY
REASON OF A PLAN'S INVESTMENT IN THE ENTITY (EACH, A "BENEFIT
PLAN").
(iv) Such Person shall comply with the provisions of Section
3.11(b), as applicable, relating to the ERISA restrictions with respect to
the acceptance or acquisition of such Trust Certificates.
(b) The Trust Certificates may not be acquired by or for the account of
(i) an employee benefit plan (as defined in Section 3(3) of the Employee
Retirement Income Security Act of 1974, as amended ("ERISA")) that is subject to
the provisions of Title I of ERISA, (ii) a plan described in Section 4975(e)(1)
of the Internal Revenue Code of 1986, as amended, or (iii) any entity, including
an insurance company separate account or general account, whose underlying
assets include plan assets by reason of a plan's investment in the entity (each,
a "BENEFIT PLAN"). By accepting and holding a Trust Certificate, the Holder
shall be deemed to have represented and warranted that it is not a Benefit Plan.
-13-
(c) The Trust Agent shall have no liability to the Issuer, any Holder, or
any other Person arising from a transfer of any Trust Certificate in reliance
upon a certification or representations, or an opinion described in this Section
3.11. Neither the Trust nor the Owner Trustee is obligated to register or
qualify the Trust Certificates under the Securities Act or any other securities
law.
(d) Promptly after receipt, the Owner Trustee shall furnish to a
requesting Holder, or any Prospective Owner designated by such Holder, the
information required to be delivered to Holders and Prospective Owners of Trust
Certificates in connection with resales of the Trust Certificates to permit
compliance with Rule 144A of the Securities Act in connection with such resales.
Such information with respect to the Trust Certificates shall be provided to the
Owner Trustee as provided in the Indenture.
ARTICLE IV
ACTIONS BY OWNER TRUSTEE
Section 4.01 Prior Notice to Holders with Respect to Certain Matters.
Subject to the provisions and limitations of Section 4.04, with respect to the
following matters, neither the Owner Trustee nor the Trust Agent shall take any
action unless at least 30 days before the taking of such action, the Owner
Trustee or the Trust Agent, as applicable, shall have notified the Holders in
writing of the proposed action and the Holders shall not have notified the Owner
Trustee or the Trust Agent, as applicable, in writing prior to the 30th day
after such notice is given that such Holders have withheld consent or provided
alternative direction:
(a) the initiation of any claim or lawsuit by the Trust and the compromise
of any action, claim or lawsuit brought by or against the Trust;
(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 Holders;
(d) the amendment, change or modification of the Administration Agreement,
except to cure any ambiguity or to amend or supplement any provision in a manner
or add any provision that would not materially adversely affect the interests of
the Holders; or
(e) the appointment pursuant to the Indenture of a successor Note
Registrar, paying agent for the Notes or Indenture Trustee or pursuant to this
Agreement of a successor Certificate Registrar or the Paying Agent, or the
consent to the assignment by the Note Registrar, paying agent for the Notes,
Indenture Trustee, Certificate Registrar or Paying Agent of its obligations
under the Indenture or this Agreement, as applicable.
-14-
Section 4.02 Action by Holders with Respect to Certain Matters. Subject to
the provisions and limitations of Section 4.04, neither the Owner Trustee nor
the Trust Agent shall have the power, except upon the direction of the Holders,
to (a) remove the Administrator pursuant to Section 8 of the Administration
Agreement, (b) appoint a successor Administrator pursuant to Section 8 of the
Administration Agreement, (c) except as expressly provided in the Basic
Documents, sell the Underlying Certificates after the termination of the
Indenture, (e) initiate any claim, suit or proceeding by the Trust or compromise
any claim, suit or proceeding brought by or against the Trust, (f) authorize the
merger or consolidation of the Trust with or into any other business trust or
entity (other than in accordance with Section 3.10 of the Indenture) or (g)
amend the Certificate of Trust (unless such amendment is required to be filed
under the Business Trust Statute). The Owner Trustee and the Trust Agent may
only take the actions referred to in the preceding sentence upon written
instructions signed by the Holders.
Section 4.03 Action by Holders with Respect to Bankruptcy. Neither the
Owner Trustee nor the Trust Agent shall have the power to commence a voluntary
proceeding in bankruptcy relating to the Trust without the unanimous prior
approval of all Holders and the delivery to the Owner Trustee or the Trust
Agent, as applicable, by each such Holder of a certificate certifying that such
Holder reasonably believes that the Trust is insolvent.
Section 4.04 Restrictions on Holders' Power. The Holders shall not direct
the Owner Trustee or the Trust Agent to take or to refrain from taking any
action if such action or inaction would be contrary to any obligation of the
Trust, or of the Owner Trustee or the Trust Agent, as applicable, under this
Agreement or any of the other Basic Documents or would be contrary to the
purpose of this Trust as set forth in Section 2.03, nor shall the Owner Trustee
or the Trust Agent be obligated to follow any such direction, if given.
Section 4.05 Majority Control. Except as expressly provided herein, any
action that may be taken by the Holders under this Agreement may be taken by the
Holders evidencing more than 50% of the Percentage Interest in the Residual
Interest. Except as expressly provided herein, any written notice of the Holders
delivered pursuant to this Agreement shall be effective if signed by Holders
evidencing more than 50% of the Percentage Interest in the Residual Interest at
the time of the delivery of such notice.
ARTICLE V
APPLICATION OF TRUST FUNDS; CERTAIN DUTIES
Section 5.01 Establishment of Certificate Distribution Account. The Trust
Agent shall, for the benefit of the Holders, establish and maintain an account
denominated "CERTIFICATE DISTRIBUTION ACCOUNT - RESIDUAL FUNDING OT 2002-A,
JPMORGAN CHASE BANK, TRUST AGENT," which account shall be an Eligible Account
(the "CERTIFICATE DISTRIBUTION ACCOUNT"). Funds shall be deposited in the
Certificate Distribution Account as provided in the Indenture.
All of the right, title and interest of the Trust Agent in all funds on
deposit from time to time in the Certificate Distribution Account and in all
proceeds thereof shall be held for the benefit of the Holders and
-15-
such other persons entitled to distributions therefrom. Except as otherwise
expressly provided herein, the Certificate Distribution Account shall be under
the sole dominion and control of the Trust Agent, as agent of the Owner Trustee,
for the benefit of the Holders. The funds on deposit in the Certificate
Distribution Account shall remain uninvested.
Section 5.02 Application of Trust Funds.
(a) On each Payment Date, the Trust Agent, on behalf of the Owner Trustee,
shall direct the Paying Agent to distribute all amounts on deposit in the
Certificate Distribution Account to the Holders pro rata.
(b) On each Payment Date, the Trust Agent, on behalf of the Owner Trustee,
shall cause the Paying Agent to send to each Holder the statement or statements
provided to the Owner Trustee or the Trust Agent by the Indenture Trustee
pursuant to Section 8.07 of the Indenture with respect to such Payment Date.
(c) In the event that any withholding tax is imposed on the Trust's
payment (or allocations of income) to a Holder, such tax shall reduce the amount
otherwise distributable to the Holder in accordance with this Section. The Trust
Agent is hereby authorized and directed to retain from amounts otherwise
distributable to the Holders sufficient funds for the payment of any tax that is
legally owed by the Trust (but such authorization shall not prevent the Owner
Trustee or the Trust Agent from contesting any such tax in appropriate
proceedings, and withholding payment of such tax, if permitted by law, pending
the outcome of such proceedings). The amount of any withholding tax imposed with
respect to a Holder shall be treated as cash distributed to such Holder at the
time it is withheld by the Trust and remitted to the appropriate taxing
authority. If the Trust Agent receives written notice that there is a
possibility that withholding tax is payable with respect to a distribution, the
Trust Agent shall withhold such amounts in accordance with this paragraph (c).
Section 5.03 Method of Payment. Subject to Section 9.01(c) respecting the
final payment upon retirement of each Trust Certificate or as otherwise agreed
between a Holder and the Trust Agent, distributions required to be made to each
Holder of record on the related Record Date shall be made by check mailed to
such Holder at the address of such Holder appearing in the Certificate Register,
in the amount to be distributed to such Holder pursuant to such Holder's Trust
Certificates or, if the Holder shall have timely notified the Trust Agent with
the proper instructions, by wire transfer.
Section 5.04 No Segregation of Monies; No Interest. Subject to Sections
5.01 and 5.02, monies received by the Trust Agent hereunder need not be
segregated in any manner except to the extent required by law and may be
deposited under such general conditions as may be prescribed by law, and the
Trust Agent shall not be liable for any interest thereon.
Section 5.05 Accounting and Reports to Holders, the Internal Revenue
Service and Others. The Trust Agent shall (a) maintain (or cause to be
maintained) the books of the Trust on a calendar year basis and the accrual
method of accounting, (b) deliver to each Holder, as may be required by the Code
and applicable Treasury Regulations, such information as may be required
(including Schedule K-1, if
-16-
applicable) to enable each Holder to prepare its federal and state income tax
returns, (c) file such tax returns relating to the Trust (including a
partnership information return, IRS Form 1065, if applicable) and make such
elections as from time to time may be required or appropriate under any
applicable state or federal statute or any rule or regulation thereunder so as
to maintain the Trust's characterization as a partnership, if applicable, for
federal income tax purposes, (d) cause such tax returns to be signed in the
manner required by law and (e) collect or cause to be collected any withholding
tax as described in and in accordance with Section 5.02(c) with respect to
income or distributions to Holders. The Trust Agent shall not make the election
provided under Section 754 of the Code.
Section 5.06 Signature on Returns; Tax Matters Partner.
(a) The Owner Trustee shall sign on behalf of the Trust the tax returns,
if any, of the Trust, unless applicable law requires a Holder to sign such
documents, in which case such documents shall be signed by the Depositor, as
long as the Depositor holds a Trust Certificate, and otherwise the holder of the
largest Percentage Interest in the Trust Certificates shall sign such documents.
(b) If a "tax matters partner" is required pursuant to Section
6231(a)(7)(A) of the Code, the Depositor shall be designated the "tax matters
partner" of the Trust pursuant to Section 6231(a)(7)(A) of the Code and
applicable Treasury Regulations, as long as the Depositor holds a Trust
Certificate, and otherwise the Holder of the largest Percentage Interest in the
Trust Certificates shall be the "tax matters partner". To the extent allowed by
law, the Depositor shall perform the obligations, if any, of the "tax matters
partner" of each entity represented by an Underlying Certificate.
ARTICLE VI
AUTHORITY AND DUTIES OF OWNER TRUSTEE AND TRUST AGENT
Section 6.01 General Authority. Subject to the provisions and limitations
of Sections 2.03 and 2.06, the Owner Trustee is authorized and directed to
execute and deliver on behalf of the Trust the Basic Documents to which the
Trust is to be a party and each certificate or other document attached as an
exhibit to or contemplated by the Basic Documents to which the Trust is to be a
party and any amendment or other agreement, as evidenced conclusively by the
Owner Trustee's execution thereof. 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. The Owner Trustee is further
authorized from time to time to take such action as the Administrator or the
Holders recommend with respect to the Basic Documents.
Section 6.02 General Duties. Subject to the provisions and limitations of
Sections 2.03 and 2.06;
(a) it shall be the duty of the Owner Trustee to discharge (or cause to be
discharged through the Administrator or such agents as shall be appointed) all
of its responsibilities pursuant to the terms of this Agreement and the other
Basic Documents to which the Trust is a party and to administer the Trust in the
interest of the Holders, subject to the Basic Documents and in accordance with
the provisions of this
-17-
Agreement. Notwithstanding the foregoing, the Owner Trustee shall be deemed to
have discharged its duties and responsibilities hereunder and under the other
Basic Documents to the extent the Administrator or the Trust Agent has agreed in
the Administration Agreement or this Agreement, respectively, to perform any act
or to discharge any duty of the Owner Trustee or the Trust hereunder or under
any Basic Document, and the Owner Trustee shall not be held liable for the
default or failure of the Administrator or the Trust Agent to carry out its
obligations under the Administration Agreement or this Agreement, respectively;
and
(b) it shall be the duty of the Trust Agent to discharge all of its
responsibilities pursuant to the terms of this Agreement and the other Basic
Documents to which the Trust and the Trust Agent are a party and to administer
the Trust in the interest of the Holders, subject to the Basic Documents and in
accordance with the provisions of this Agreement.
Section 6.03 Action Upon Instruction.
(a) Subject to Article IV and Section 7.01(g) of this Agreement, in
accordance with the terms of the Basic Documents, the Holders may by written
instruction direct the Owner Trustee or the Trust Agent in the management of the
Trust. Such direction may be exercised at any time by written instruction of the
Holders pursuant to Article IV.
(b) Neither the Owner Trustee nor the Trust Agent shall be required to
take any action hereunder or under any other Basic Document if the Owner Trustee
or the Trust Agent, as applicable, 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 the Trust Agent, as applicable, or is
contrary to the terms hereof or of any other Basic Document or is otherwise
contrary to law.
(c) Whenever the Owner Trustee or the Trust Agent is unable to decide
between alternative courses of action permitted or required by the terms of this
Agreement or under any other Basic Document, the Owner Trustee or the Trust
Agent, as applicable, shall promptly give notice (in such form as shall be
appropriate under the circumstances) to the Holders requesting instruction as to
the course of action to be adopted, and to the extent the Owner Trustee or the
Trust Agent, as applicable, acts in good faith in accordance with any written
instruction of the Holders received, the Owner Trustee or the Trust Agent, as
applicable, shall not be liable on account of such action to any Person. If the
Owner Trustee or the Trust Agent 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 and the other Basic
Documents, as it shall deem to be in the best interests of the Holders, and
shall have no liability to any Person for such action or inaction.
(d) In the event that the Owner Trustee or the Trust Agent is unsure as to
the application of any provision of this Agreement or any other Basic Document
or any such provision is ambiguous as to its application, or is, or appears to
be, in conflict with any other applicable provision, or in the event that this
Agreement permits any determination by the Owner Trustee or the Trust Agent 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,
-18-
the Owner Trustee or the Trust Agent may give notice (in such form as shall be
appropriate under the circumstances) to the Holders requesting instruction and,
to the extent that the Owner Trustee or the Trust Agent, as applicable, acts or
refrains from acting in good faith in accordance with any such instruction
received, the Owner Trustee or the Trust Agent, as applicable, shall not be
liable, on account of such action or inaction, to any Person. If the Owner
Trustee or the Trust Agent shall not have received appropriate instruction
within ten days of such notice (or within such shorter period of time as
reasonably may be specified in such notice or may be necessary under the
circumstances) it may, but shall be under no duty to, take or refrain from
taking such action not inconsistent with this Agreement or the other Basic
Documents, and shall have no liability to any Person for such action or
inaction.
Section 6.04 No Duties Except as Specified in this Agreement or in
Instructions. Neither the Owner Trustee nor the Trust Agent shall have any duty
or obligation to manage, make any payment with respect to, register, record,
sell, dispose of or otherwise deal with the Trust Estate, or to otherwise take
or refrain from taking any action under, or in connection with, any document
contemplated hereby to which the Owner Trustee or the Trust Agent, as
applicable, 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 or the Trust Agent, as applicable, pursuant to Section 6.01 or 6.03; and
no implied duties or obligations shall be read into this Agreement or any other
Basic Document against the Owner Trustee or the Trust Agent. Neither the Owner
Trustee nor the Trust Agent shall have any 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 with the Commission any filing for
the Trust or to record this Agreement or any other Basic Document. Each of the
Owner Trustee and the Trust Agent nevertheless agrees that it will, at its own
cost and expense, promptly take all action as may be necessary to discharge any
liens on any part of the Trust Estate that result from actions by, or claims
against, the Owner Trustee or the Trust Agent, as applicable, that are not
related to the ownership or the administration of the Trust Estate or the Grant
of any portion thereof to the Indenture Trustee pursuant to the Indenture.
Section 6.05 No Action Except Under Specified Documents or Instructions.
Neither the Owner Trustee nor the Trust Agent shall manage, control, use, sell,
dispose of or otherwise deal with any part of the Trust Estate except in
accordance with (i) the powers granted to and the authority conferred upon the
Owner Trustee or the Trust Agent, as applicable, pursuant to this Agreement,
(ii) the other Basic Documents and (iii) any document or instruction delivered
to the Owner Trustee or the Trust Agent, as applicable, pursuant to Section
6.03.
Section 6.06 Restrictions. Neither the Owner Trustee nor the Trust Agent
shall take any action (i) that is inconsistent with the purposes of the Trust
set forth in Section 2.03 or (ii) that, to the actual knowledge of a Responsible
Officer of the Owner Trustee or the Trust Agent, as applicable, would result in
the Trust's becoming taxable as a corporation for federal or state income tax
purposes. The Holders shall not direct the Owner Trustee or the Trust Agent to
take action that would violate the provisions of this Section.
-19-
ARTICLE VII
CONCERNING THE OWNER TRUSTEE AND THE TRUST AGENT
Section 7.01 Acceptance of Trusts and Duties. The Owner Trustee accepts
the trusts hereby created and agrees to perform its duties hereunder with
respect to such trusts but only upon the terms of this Agreement and the other
Basic Documents. The Trust Agent agrees to perform its duties hereunder upon the
terms of this Agreement and the other Basic Documents. Neither the Owner Trustee
nor the Trust Agent shall be liable except for the performance of such duties
and obligations as are specifically set forth in this Agreement, no implied
covenants or obligations shall be read into this Agreement against the Owner
Trustee or the Trust Agent and, in the absence of bad faith on the part of the
Owner Trustee or the Trust Agent, as applicable, the Owner Trustee and the Trust
Agent may conclusively rely, as to the truth of the statements and the
correctness of the opinions expressed therein, upon any certificates or opinions
furnished to the Owner Trustee or the Trust Agent and conforming to the
requirements of this Agreement. Each of the Owner Trustee and the Trust Agent
agrees to disburse all monies actually received by it constituting part of the
Trust Estate upon the terms of this Agreement and the other Basic Documents.
Neither the Owner Trustee nor the Trust Agent shall be answerable or accountable
hereunder or under any other Basic Document under any circumstances, except (i)
for its own willful misconduct or negligence or (ii) in the case of the
inaccuracy of any representation or warranty contained in Section 7.03 expressly
made by the Owner Trustee or the Trust Agent, as the case may be. In particular,
but not by way of limitation (and subject to the exceptions set forth in the
preceding sentence):
(a) neither the Owner Trustee nor the Trust Agent shall be liable for any
error of judgment made by a Responsible Officer of the Owner Trustee or the
Trust Agent, respectively;
(b) neither the Owner Trustee nor the Trust Agent shall be liable with
respect to any action taken or omitted to be taken by it in good faith in
accordance with this Agreement, the Basic Documents or the written direction of
the Administrator or any Holder;
(c) no provision of this Agreement or any other Basic Document shall
require the Owner Trustee or the Trust Agent 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 other Basic Document if the Owner Trustee or
the Trust Agent 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 or the Trust Agent be
liable for indebtedness evidenced by or arising under any of the Basic
Documents, including the principal of and interest on the Notes;
(e) neither the Owner Trustee nor the Trust Agent shall be responsible for
or in respect of the validity or sufficiency of this Agreement or for the due
execution hereof by the Depositor or for the form, character, genuineness,
sufficiency, value or validity of any of the Trust Estate, or for or in respect
of the validity or sufficiency of the Basic Documents, other than the
certificate of authentication on the Trust Certificates, and neither the Owner
Trustee nor the Trust Agent shall assume or incur any liability, duty or
-20-
obligation to any Noteholder or to any Holder, other than as expressly provided
for herein or expressly agreed to in the other Basic Documents;
(f) neither the Owner Trustee nor the Trust Agent shall be liable for the
default or misconduct of the Administrator, the Depositor or the Indenture
Trustee under any of the Basic Documents or otherwise and neither the Owner
Trustee nor the Trust Agent shall have any obligation or liability to perform
the obligations of the Trust under this Agreement or the other Basic Documents
that are required to be performed by the Administrator under the Administration
Agreement, the Indenture Trustee under the Indenture or the Depositor under the
Sale and Assignment Agreement;
(g) neither the Owner Trustee nor the Trust Agent shall be under any
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 other Basic
Document, at the request, order or direction of the Holders, unless such Holders
have offered to the Owner Trustee or the Trust Agent, as applicable, security or
indemnity satisfactory to it against the costs, expenses and liabilities that
may be incurred by the Owner Trustee or the Trust Agent, as applicable, therein
or thereby; the right of the Owner Trustee and the Trust Agent to perform any
discretionary act enumerated in this Agreement or in any other Basic Document
shall not be construed as a duty, and neither the Owner Trustee nor the Trust
Agent shall be answerable for other than its negligence or willful misconduct in
the performance of any such act;
(h) anything in this Agreement to the contrary notwithstanding, in no
event shall the Owner Trustee or Trust Agent be liable for special, indirect or
consequential loss or damage of any kind whatsoever (including but not limited
to lost profit), even if the Owner Trustee or Trust Agent has been advised of
the likelihood of such loss or damage and regardless of the form of action;
(i) neither the Owner Trustee nor the Trust Agent shall be required to
take notice or be deemed to have notice or knowledge of any default or any Event
of Default under any of the Basic Documents unless a Responsible Officer of the
Owner Trustee or the Trust Agent, respectively, shall have received written
notice thereof. In the absence of receipt of such notice, the Owner Trustee and
Trust Agent may conclusively assume that there is no default or Event of
Default;
(j) each of the Owner Trustee and the Trust Agent may rely and shall be
protected in acting or refraining from acting upon any resolution, opinion of
counsel, certificate of auditors or any other certificate, statement,
instrument, opinion, report, notice, request, consent, order, appraisal, bond or
other paper or document believed by it to be genuine and to have been signed or
presented by the proper party or parties;
(k) each of the Owner Trustee and the Trust Agent may consult with counsel
and any advice or opinion of counsel shall be full and complete authorization
and protection in respect of any action taken or suffered or omitted by it
hereunder in good faith and in accordance with such advice or opinion of
counsel;
-21-
(l) neither the Owner Trustee nor the Trust Agent shall be bound to make
any investigation into the facts or matters stated in any resolution,
certificate, statement, instrument, opinion, report, notice, request, consent,
order, approval, bond or other paper or document, unless requested in writing to
do so by the Administrator or Holders; provided, however, that if the payment
within a reasonable time to the Owner Trustee or Trust Agent, as applicable, of
the costs, expenses or liabilities likely to be incurred by it in the making of
such investigation is, in the opinion of the Owner Trustee or Trust Agent, as
applicable, not reasonably assured to it by the security afforded to them by the
terms of this Agreement, the Owner Trustee or Trust Agent, as applicable, may
require reasonable indemnity against such cost, expense or liability as a
condition to taking any such action;
(m) neither the Owner Trustee nor the Trust Agent shall be required to
give any bond or surety in respect of the execution of the Trust created hereby
or the powers granted hereunder; and
(n) each of the Owner Trustee and Trust Agent may execute any of their
respective trusts or powers hereunder or perform any of their respective duties
hereunder either directly or by or through agents, attorneys or custodians, and
neither the Owner Trustee nor the Trust Agent shall be responsible for any
misconduct or negligence on the part of any such agent, attorney or custodian
appointed by the Owner Trustee or Trust Agent, as applicable, with due care.
Section 7.02 Furnishing of Documents. The Owner Trustee shall furnish to
the Trust Agent 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. The Trust Agent shall furnish to the
Holders 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 Trust Agent under the
Basic Documents or furnished to the Trust Agent as provided in the preceding
sentence.
Section 7.03 Representations and Warranties.
(a) The Owner Trustee hereby represents and warrants to the Depositor and
the Holders:
(i) It is a banking corporation duly organized and validly existing
in good standing under the laws of the State of Delaware. It has all
requisite corporate power and authority to execute, deliver and perform
its obligations under this Agreement.
(ii) It has taken all corporate action necessary to authorize the
execution and delivery by it of this Agreement, and this Agreement will be
executed and delivered by one of its officers who is duly authorized to
execute and deliver this Agreement on its behalf.
(iii) Neither the execution nor the delivery by it of this
Agreement, nor the consummation by it of the transactions contemplated
hereby nor compliance by it with any of the terms or provisions hereof
will contravene any federal or Delaware law, governmental rule or
regulation governing the banking or trust powers of the Owner Trustee or
any judgment or order binding on it, or constitute any default under its
charter documents or bylaws or, to its actual knowledge, any indenture,
mortgage, contract, agreement or instrument to which it is a party or by
-22-
which any of its properties may be bound or result in the creation or
imposition of any lien, charge or encumbrance on the Trust Estate
resulting from actions by or claims against the Owner Trustee individually
which are unrelated to this Agreement or the other Basic Documents.
(b) The Trust Agent hereby represents and warrants to the Depositor and
the Holders:
(i) It is a New York banking corporation duly organized and validly
existing in good standing under the laws of the State of New York. It has
all requisite corporate power and authority to execute, deliver and
perform its obligations under this Agreement.
(ii) It has taken all corporate action necessary to authorize the
execution and delivery by it of this Agreement, and this Agreement will be
executed and delivered by one of its officers who is duly authorized to
execute and deliver this Agreement on its behalf.
(iii) Neither the execution nor the delivery by it of this
Agreement, nor the consummation by it of the transactions contemplated
hereby nor compliance by it with any of the terms or provisions hereof
will contravene any federal law, governmental rule or regulation governing
the banking or trust powers of the Trust Agent or any judgment or order
binding on it, or constitute any default under its charter documents or
bylaws or any indenture, mortgage, contract, agreement or instrument to
which it is a party or by which any of its properties may be bound or
result in the creation or imposition of any lien, charge or encumbrance on
the Trust Estate resulting from actions by or claims against the Trust
Agent individually which are unrelated to this Agreement or the other
Basic Documents.
Section 7.04 Reliance; Advice of Counsel.
(a) Neither the Owner Trustee nor the Trust Agent shall incur 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 and the Trust Agent may accept a certified copy of
a resolution of the board of directors or other governing body of any corporate
party as conclusive evidence that such resolution has been duly adopted by such
body and that the same is in full force and effect. As to any fact or matter the
method of determination of which is not specifically prescribed herein, the
Owner Trustee and the Trust Agent may for all purposes hereof rely on a
certificate, signed by the president or any vice president or by the treasurer
or other authorized officers of the relevant party, as to such fact or matter
and such certificate shall constitute full protection to the Owner Trustee or
the Trust Agent, as applicable, 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 other
Basic Documents, the Owner Trustee and the Trust Agent each (i) may act directly
or through its agents or attorneys pursuant to agreements entered into with any
of them, and neither the Owner Trustee nor the Trust Agent shall 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 or the Trust Agent with
reasonable care, and (ii) may consult with counsel, accountants and other
-23-
skilled persons to be selected with reasonable care and employed by it at the
sole expense of the Depositor. Neither the Owner Trustee nor the Trust Agent
shall 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 not contrary to this Agreement or any other Basic
Document.
Section 7.05 Not Acting in Individual Capacity. Except as otherwise
provided in this Article VII in accepting the trusts hereby created, Bankers
Trust (Delaware) acts solely as Owner Trustee hereunder and not in its
individual capacity, and JPMorgan Chase Bank acts solely as Trust Agent
hereunder and not in its individual capacity, and all Persons having any claim
against the Owner Trustee or the Trust Agent by reason of the transactions
contemplated by this Agreement or any other Basic Document shall look only to
the Trust Estate for payment or satisfaction thereof.
Section 7.06 Owner Trustee and Trust Agent Not Liable for Trust
Certificates, Notes or Underlying Certificates. The recitals contained herein
and in the Trust Certificates (other than (i) the respective signatures of the
Owner Trustee and the Trust Agent; (ii) in the case of the Owner Trustee, the
recitals contained in Section 7.03(a); and (iii) in the case of the Trust Agent,
the recitals contained in Section 7.03(b) and the certificate of authentication
on the Trust Certificates) shall be taken as the statements of the Depositor,
and neither the Owner Trustee nor the Trust Agent assumes responsibility for the
correctness thereof. Neither the Owner Trustee nor the Trust Agent makes any
representations as to the validity or sufficiency of this Agreement, any other
Basic Document or the Trust Certificates (other than the respective signatures
of the Owner Trustee and the Trust Agent, and, in the case of the Trust Agent,
the certificate of authentication on the Trust Certificates) or the Notes, or of
any related documents. The Owner Trustee and the Trust Agent shall at no time
have any responsibility or liability for or with respect to the sufficiency of
the Trust Estate or its ability to generate the payments to be distributed to
Holders under this Agreement or the Noteholders under the Indenture, including,
without limitation, the validity of the assignment of any Underlying Certificate
to the Trust or of any intervening assignment; the compliance by the Depositor
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 Administrator or the Indenture Trustee taken in the name of the
Owner Trustee or the Trust Agent.
Section 7.07 Owner Trustee and Trust Agent May Own Trust Certificates and
Notes. The Owner Trustee and the Trust Agent, each in its individual or any
other capacity, may become the owner or pledgee of Trust Certificates or Notes
and may deal with the Depositor, the Administrator and the Indenture Trustee in
banking transactions with the same rights as it would have if it were not Owner
Trustee or Trust Agent, as the case may be.
-24-
ARTICLE VIII
COMPENSATION AND INDEMNIFICATION OF OWNER
TRUSTEE AND TRUST AGENT
Section 8.01 Owner Trustee's and Trust Agent's Fees and Expenses. The
Owner Trustee and the Trust Agent shall receive as compensation for their
respective services hereunder such fees as have been separately agreed upon
before the date hereof between the Administrator and the Owner Trustee and the
Trust Agent, respectively, and the Owner Trustee and the Trust Agent shall be
entitled to be reimbursed by the Administrator for other reasonable expenses
hereunder, including the reasonable compensation, expenses and disbursements of
such agents, representatives, experts and counsel as the Owner Trustee or the
Trust Agent may employ in connection with the exercise and performance of its
rights and its duties hereunder.
Section 8.02 Indemnification. The Owner Trustee and the Trust Agent shall
be entitled to indemnification as provided in the Administration Agreement.
Section 8.03 Payments to the Owner Trustee or Trust Agent. Any amounts
paid to the Owner Trustee or the Trust Agent pursuant to this Article shall be
deemed not to be a part of the Trust Estate immediately after such payment.
ARTICLE IX
TERMINATION OF TRUST AGREEMENT
Section 9.01 Termination of Trust Agreement.
(a) This Agreement (other than Article VIII) and the Trust shall terminate
and be of no further force or effect upon the earlier of (i) final distribution
of all monies or other property or proceeds of the Trust Estate in accordance
with the terms of the Indenture and Article V of this Agreement and (ii) the
expiration of 21 years from the death of the last survivor of the descendants of
Xxxxxx X. Xxxxxxx, the late Ambassador of the United States to the Court of St.
James's, living on the date hereof. The bankruptcy, liquidation, dissolution,
death or incapacity of any Holder shall not (i) operate to terminate this
Agreement or the Trust, (ii) entitle such Holder's legal representatives or
heirs to claim an accounting or to take any action or proceeding in any court
for a partition or winding up of all or any part of the Trust or Trust Estate or
(iii) otherwise affect the rights, obligations and liabilities of the parties
hereto.
(b) Except as provided in Section 9.01(a), neither the Depositor nor any
Holder shall be entitled to revoke or dissolve the Trust.
-25-
(c) Notice of any dissolution of the Trust, specifying the Payment Date
upon which Holders shall surrender their Trust Certificates to the Paying Agent
for payment of the final distribution and cancellation, shall be given by the
Trust Agent by letter to Holders and, to the extent the Notes have not been paid
in full, to the Indenture Trustee mailed within five Business Days of receipt of
notice of such termination from the Seller given pursuant to Article IV of the
Sale and Assignment Agreement, stating (i) the Payment Date upon or with respect
to which final payment of the Trust Certificates shall be made upon presentation
and surrender of the Trust Certificates at the office of the Paying Agent in the
City of New York therein designated, (ii) the amount of any such final payment
and (iii) that the Record Date otherwise applicable to such Payment Date is not
applicable, payments being made only upon presentation and surrender of the
Trust Certificates at the office of the Paying Agent therein specified. The
Trust Agent shall give such notice to the Certificate Registrar (if other than
the Trust Agent) and the Paying Agent (if other than the Trust Agent) at the
time such notice is given to Holders. After satisfaction of any liabilities of
the Trust in accordance with the Business Trust Statute, upon presentation and
surrender of the Certificates, the Paying Agent shall cause to be distributed to
Holders of the Trust Certificates, on a pro rata basis, any amounts remaining in
the Trust upon the termination of this Agreement. In addition, the Trust Agent
shall notify the Rating Agency upon the final distribution in respect of the
Trust Certificates.
(d) In the event that all of the Holders shall not surrender their Trust
Certificates for cancellation within six months after the date specified in the
above-mentioned written notice, the Trust Agent shall give a second written
notice to the remaining Holders to surrender their Trust Certificates for
cancellation and receive the final distribution with respect thereto. If within
one year after the second notice all the Trust Certificates shall not have been
surrendered for cancellation, the Trust Agent may take appropriate steps, or may
appoint an agent to take appropriate steps, to contact the remaining Holders
concerning surrender of their Trust Certificates, and the cost thereof shall be
paid out of the funds and other assets that shall remain subject to this
Agreement.
(e) Upon the winding up of the Trust and its termination, the Owner
Trustee shall cause the Certificate of Trust to be canceled by filing a
certificate of cancellation with the Secretary of State in accordance with the
provisions of Section 3810 of the Business Trust Statute. Upon the filing of
such certificate, the Trust and this Agreement (other than Article VIII) shall
terminate and be of no further force or effect.
ARTICLE X
SUCCESSOR OWNER TRUSTEES, ADDITIONAL OWNER
TRUSTEE AND TRUST AGENT
Section 10.01 Eligibility Requirements for Owner Trustee. The Owner
Trustee shall at all times be a corporation satisfying the provisions of Section
3807(a) of the Business Trust Statute; authorized to exercise corporate trust
powers; having a combined capital and surplus of at least $50,000,000 and
subject to supervision or examination by federal or state authorities; and
having (or having a parent that has) a rating of at least Baa3 by Xxxxx'x. 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
-26-
purpose of this Section, the combined capital and surplus of such corporation
shall be deemed to be its combined capital and surplus as set forth in its most
recent report of condition so published. In case at any time the Owner Trustee
shall cease to be eligible in accordance with the provisions of this Section,
the Owner Trustee shall resign immediately in the manner and with the effect
specified in Section 10.02.
Section 10.02 Resignation or Removal of Owner Trustee. The Owner Trustee
may at any time resign and be discharged from the trusts hereby created by
giving written notice thereof to the Administrator. Upon receiving such notice
of resignation, the Administrator shall promptly appoint a successor Owner
Trustee by written instrument, in duplicate, one copy of which instrument shall
be delivered to the resigning Owner Trustee and one copy to the successor Owner
Trustee. If no successor Owner Trustee shall have been so appointed and have
accepted appointment within 30 days after the giving of such notice of
resignation, the resigning Owner Trustee may petition any court of competent
jurisdiction for the appointment of a successor Owner Trustee.
If at any time the Owner Trustee shall cease to be eligible in accordance
with the provisions of Section 10.01 and shall fail to resign after written
request therefor by the Administrator, 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, or if at any time the Owner Trustee shall have breached any
representation or warranty contained in Section 7.03(a) (without regard to any
knowledge qualification), then the Administrator may remove the Owner Trustee.
If the Owner Trustee shall be removed under the authority of the immediately
preceding sentence, the Administrator shall promptly appoint a successor Owner
Trustee by written instrument, in duplicate, one copy of which instrument shall
be delivered to the outgoing Owner Trustee so removed and one copy to the
successor Owner Trustee, and shall pay all fees owed to the outgoing Owner
Trustee.
Any resignation or removal of the Owner Trustee and appointment of a
successor Owner Trustee pursuant to any of the provisions of this Section shall
not become effective until acceptance of appointment by the successor Owner
Trustee pursuant to Section 10.03 and payment of all fees and expenses owed to
the outgoing Owner Trustee. The Administrator shall provide notice of such
resignation or removal of the Owner Trustee to the Rating Agency.
Section 10.03 Successor Owner Trustee. Any successor Owner Trustee
appointed pursuant to Section 10.02 shall execute, acknowledge and deliver to
the Administrator 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 Administrator 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.
-27-
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 Section 10.01.
Upon acceptance of appointment by a successor Owner Trustee pursuant to
this Section, the Administrator shall mail notice thereof to all Holders, the
Depositor, the Indenture Trustee, the Noteholders and the Rating Agency. If the
Administrator shall fail to mail such notice within ten days after acceptance of
such appointment by the successor Owner Trustee, the successor Owner Trustee
shall cause such notice to be mailed at the expense of the Administrator.
Section 10.04 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, without
the execution or filing of any instrument or any further act on the part of any
of the parties hereto, anything herein to the contrary notwithstanding;
provided, that such corporation shall be eligible pursuant to Section 10.01 and,
provided, further, that the Owner Trustee shall mail notice of such merger or
consolidation to the Rating Agency.
Section 10.05 Appointment of Co-Trustee or Separate Trustee.
Notwithstanding any other provisions of this Agreement, at any time, for the
purpose of meeting any legal requirements of any jurisdiction in which any part
of the Trust Estate may at the time be located, the Administrator and the Owner
Trustee acting jointly shall have the power and shall execute and deliver all
instruments to appoint one or more Persons approved by the Administrator and
Owner Trustee to act as co-trustee, jointly with the Owner Trustee, or as
separate trustee or separate trustees, of all or any part of the Trust Estate,
and to vest in such Person, in such capacity, such title to the Trust or any
part thereof and, subject to the other provisions of this Section, such powers,
duties, obligations, rights and trusts as the Administrator and the Owner
Trustee may consider necessary or desirable. If the Administrator shall not have
joined in such appointment within 15 days after the receipt by it of a request
to do so, the Owner Trustee 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 Owner Trustee, provided that such
co-trustee or successor trustee must be acceptable to the Rating Agency and no
notice of the appointment of any co- trustee or separate trustee shall be
required pursuant to Section 10.03.
Section 10.06 Appointment of Trust Agent. Each separate trustee and
co-trustee shall, to the extent permitted by law, be appointed and act subject
to the following provisions and conditions:
(a) all rights, powers, duties and obligations conferred or imposed upon
the Owner Trustee shall be conferred upon and exercised or performed by the
Owner Trustee and such separate trustee or co-trustee jointly (it being
understood that such separate trustee or co-trustee is not authorized to act
separately without the Owner Trustee joining in such act), except to the extent
that under any law of any jurisdiction in which any particular act or acts are
to be performed, the Owner Trustee shall be incompetent or unqualified to
perform such act or acts, in which event such rights, powers, duties and
obligations (including the holding of title to the Trust Estate or any portion
thereof in any such jurisdiction) shall be
-28-
exercised and performed singly by such separate trustee or co-trustee, but
solely at the direction of the Owner Trustee;
(b) no trustee under this Agreement shall be personally liable by reason
of any act or omission of any other trustee under this Agreement; and
(c) the Administrator 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 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 Administrator.
Any separate trustee or co-trustee may at any time appoint the Owner
Trustee as its agent or attorney-in-fact with full power and authority, to the
extent not prohibited by law, to do any lawful act under or in respect of this
Agreement on its behalf and in its name. If any separate trustee or co-trustee
shall die, become incapable of acting, resign or be removed, all of its estates,
properties, rights, remedies and trusts shall vest in and be exercised by the
Owner Trustee, to the extent permitted by law, without the appointment of a new
or successor co-trustee or separate trustee.
The Owner Trustee on behalf of the Trust hereby appoints JPMorgan Chase
Bank as Trust Agent for the purpose of establishing and maintaining the
Certificate Distribution Account and making the distributions therefrom to the
persons entitled thereto pursuant to Section 5.02 of this Agreement and for
purposes of performing the other duties specified to be performed by the Trust
Agent under this Agreement and the other Basic Documents. The Trust Agent, in
its capacity as Trust Agent, shall not have any rights, duties or obligations
except as expressly provided in this Agreement and the Sale and Assignment
Agreement.
The Trust Agent may at any time resign and be discharged from the trusts
hereby created by giving 30 days' written notice thereof to the Owner Trustee
and the Administrator. Upon receiving such notice of resignation, the Owner
Trustee shall promptly appoint a successor Trust Agent by written instrument, in
duplicate, one copy of which instrument shall be delivered to the resigning
Trust Agent and one copy to the successor Trust Agent.
-29-
ARTICLE XI
MISCELLANEOUS
Section 11.01 Supplements and Amendments.
(a) This Agreement may be amended by the Depositor, the Owner Trustee and
the Trust Agent with the consent of MBIA Insurance Corporation but without the
consent of any of the Noteholders or the Holders, to cure any ambiguity, to
correct or supplement any provisions herein which may be inconsistent with any
of the provisions herein or make any other provisions with respect to matters or
questions arising hereunder that shall not be inconsistent with the provisions
of this Agreement; provided, however, that (i) any such action shall not
materially and adversely affect the interests of any Noteholder or any Holder;
(ii) any such action shall be deemed not to materially and adversely affect the
interest of any Noteholder if the Person requesting the amendment obtains (A) a
letter from the Rating Agency to the effect that the amendment would not result
in a downgrading or withdrawal of the ratings then assigned to the Notes by such
Rating Agency or (B) an opinion of counsel to such effect; and (iii) any such
action shall be deemed not to materially and adversely affect the interest of
any Holder if the Person requesting such amendment obtains an opinion of counsel
to such effect, or Holders representing 100% of the Percentage Interests consent
to such amendment.
(b) This Agreement may also be amended from time to time by the Depositor,
the Owner Trustee and the Trust Agent, with the consent of MBIA Insurance
Corporation and Noteholders representing not less than 51% of the Outstanding
Amount of the Notes (which consent of any Noteholder given pursuant to this
Section or pursuant to any other provision of this Agreement shall be conclusive
and binding on such Noteholder and on all future Noteholders issued upon the
transfer thereof or in exchange thereof or in lieu thereof whether or not
notation of such consent is made thereon) and, if such amendment materially and
adversely affects the interests of the Holders, with the consent of Holders
evidencing not less than 51% of the Percentage Interests, for the purpose of
adding any provisions to or changing in any manner or eliminating any of the
provisions of this Agreement, or of modifying in any manner the rights of the
Noteholders or the Holders; provided, however, that no such amendment may (i)
increase or reduce in any manner the amount of, or accelerate or delay the
timing of, collections of payments on the Underlying Certificates or
distributions that shall be required to be made for the benefit of the
Noteholders or Holders, (ii) reduce the aforesaid percentage of the Outstanding
Amount of the Notes or Percentage Interest of the Holders required to consent to
any such amendment, without the consent of the Holders of all outstanding Notes
and Trust Certificates or (iii) alter the provisions of Section 11.07 or 11.08,
without the consent of MBIA Insurance Corporation or its successor in interest.
(c) Prior to the execution of any such amendment or consent, the Owner
Trustee shall furnish written notification of the substance of such amendment or
consent, together with a copy thereof, to the Indenture Trustee, the
Noteholders, the Administrator and the Rating Agency.
-30-
(d) Promptly after the execution of any such amendment or consent, the
Trust Agent shall furnish a copy of such amendment or consent to each Holder and
Noteholder. The manner of obtaining such consents (and any other consents of
Holders provided for in this Agreement or in any other Basic Document) and of
evidencing the authorization of the execution thereof by Holders shall be
subject to such reasonable requirements as the Owner Trustee may prescribe.
(e) Promptly after the execution of any amendment to the Certificate of
Trust, the Owner Trustee shall cause the filing of such amendment with the
Secretary of State.
(f) In connection with the execution of any amendment to this Agreement or
any other Basic Document to which the Trust is a party and for which amendment
the Owner Trustee's consent is sought, each of the Owner Trustee and the Trust
Agent shall be entitled to receive and conclusively rely upon an Opinion of
Counsel to the effect that such amendment is authorized or permitted by the
Basic Documents and that all conditions precedent in the Basic Documents for the
execution and delivery thereof by the Trust, the Owner Trustee or the Trust
Agent, as the case may be, have been satisfied. The Owner Trustee and the Trust
Agent may, but shall not be obligated to, enter into any such amendment that
affects the Owner Trustee's or the Trust Agent's own rights, duties or
immunities under this Agreement or otherwise.
Section 11.02 Limitations on Rights of Others. Except for Section 2.07,
the provisions of this Agreement are solely for the benefit of the Owner
Trustee, the Trust Agent, the Depositor, the Holders, the Administrator and, to
the extent expressly provided herein, the Indenture Trustee and the Noteholders,
and nothing in this Agreement (other than Section 2.07), whether express or
implied, shall be construed to give to any other Person any legal or equitable
right, remedy or claim in the Trust Estate or under or in respect of this
Agreement or any covenants, conditions or provisions contained herein.
Section 11.03 Notices. All demands, notices and communications under this
Agreement shall be in writing personally delivered or mailed by certified mail,
return receipt requested, and shall be deemed to have been duly given upon
receipt in the case of (a) the Owner Trustee, at the Owner Trustee Corporate
Trust Office; (b) the Depositor, at Onyx Acceptance Financial Corporation, 00000
Xxxxx Xxxxxx Xxxxx, Xxxxx 000, Xxxxxxxx Xxxxx, Xxxxxxxxxx 00000; (c) the Trust
Agent, at JPMorgan Chase Bank, Attention: Institutional Trust Services 000 Xxxx
00xx Xxxxxx, 00xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000; or (d) as to each party, at
such other address as shall be designated by such party in a written notice to
each other party. Any notice required or permitted to be mailed to a Holder
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 Holder receives such notice.
Section 11.04 Severability of Provisions. If any one or more of the
covenants, agreements, provisions or terms of this Agreement shall be for any
reason whatsoever held invalid, then such covenants, agreements, provisions or
terms shall be deemed severable from the remaining covenants, agreements,
provisions or terms of this Agreement and shall in no way affect the validity or
enforceability of the other provisions of this Agreement or of the Trust
Certificates or the rights of the Holders thereof.
-31-
Section 11.05 Counterparts. This Agreement may be executed in several
counterparts, each of which shall be an original and all of which shall
constitute but one and the same instrument.
Section 11.06 Successors and Assigns. All covenants and agreements
contained herein shall be binding upon, and inure to the benefit of, each of the
Depositor, the Owner Trustee, the Trust Agent and their respective successors
and permitted assigns and each Holder and its successors and permitted assigns,
all as herein provided. Any request, notice, direction, consent, waiver or other
instrument or action by a Holder shall bind the successors and assigns of such
Holder.
Section 11.07 No Petition.
(a) The Depositor will not at any time institute against the Trust any
bankruptcy proceedings under any United States federal or state bankruptcy or
similar law in connection with any obligations relating to the Trust
Certificates, the Notes, this Agreement or any of the other Basic Documents.
(b) Each of the Owner Trustee and the Trust Agent, by entering into this
Agreement, each Holder, by accepting a Trust Certificate, and the Indenture
Trustee and each Noteholder, by accepting the benefits of this Agreement, hereby
covenant and agree that they will not at any time institute against the Seller,
the Depositor or the Trust, or join in any institution against the Seller, the
Depositor or the Trust of, any bankruptcy proceedings under any United States
federal or state bankruptcy or similar law in connection with any obligations
relating to the Trust Certificates, the Notes, this Agreement or any of the
other Basic Documents.
Section 11.08 No Recourse. The Owner Trustee and each Holder by accepting
a Trust Certificate acknowledges that such Holder's Trust Certificates
represents a beneficial interest in the Trust only and does not represent an
interest in or obligation of the Depositor, the Seller, the Administrator, the
Owner Trustee, the Trust Agent, the Indenture Trustee or any of their respective
Affiliates and no recourse may be had against such parties or their assets,
except as may be expressly set forth or contemplated in this Agreement, the
Trust Certificates or the other Basic Documents.
Section 11.09 Certificates Nonassessable and Fully Paid. Holders shall not
be personally liable for obligations of the Trust. Except as expressly provided
herein, the interests represented by the Trust Certificates shall be
nonassessable for any losses or expenses of the Trust or for any reason
whatsoever, and, upon authentication thereof pursuant to Section 3.03, the Trust
Certificates shall be deemed fully paid.
Section 11.10 Headings. The headings of the various Articles and Sections
herein are for convenience of reference only and shall not define or limit any
of the terms or provisions hereof.
Section 11.11 Governing Law. THIS AGREEMENT SHALL BE CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF DELAWARE, 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.
-32-
Section 11.12 Duties. The duties and responsibilities of the Owner Trustee
and the Trust Agent shall be limited to those expressly provided for in this
Agreement. The parties hereto agree that except for the purpose of the foregoing
sentence, neither the Owner Trustee nor the Trust Agent shall have management
responsibilities.
-33-
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.
ONYX ACCEPTANCE FINANCIAL
CORPORATION, as Depositor
By:
---------------------------------------
Name:
Title:
BANKERS TRUST (DELAWARE),
as Owner Trustee
By:
---------------------------------------
Name:
Title:
JPMORGAN CHASE BANK,
as Trust Agent
By:
---------------------------------------
Name:
Title:
-34-
EXHIBIT A
FORM OF
CERTIFICATE OF TRUST OF
ONYX ACCEPTANCE RESIDUAL FUNDING OWNER TRUST 2002-A
This Certificate of Trust of Onyx Acceptance Residual Funding Owner Trust
2002-A (the "TRUST") is being duly executed and filed by the undersigned, as
trustees, to form a business trust under the Delaware Business Trust Act (12
Del. Code, Section 3801 et seq. (the "ACT")).
1. Name. The name of the business trust formed hereby is Onyx Acceptance
Residual Funding Owner Trust 2002-A.
2. Delaware Trustee. The name and business address of the trustee of the
Trust in the State of Delaware is Bankers Trust Company (Delaware), E.A. Delle
Donne Corporate Center, 0000 Xxxxxx Xxxx, Xxxxx 000, Xxxxxxxxxx, Xxxxxxxx
00000-0000, Attention: Corporate Trust Administration.
3. Effective Date. This Certificate of Trust shall be effective March __,
2002.
IN WITNESS WHEREOF, the undersigned has duly executed this Certificate of
Trust in accordance with Section 3811(a)(1) of the Act.
BANKERS TRUST COMPANY (DELAWARE),
not in its individual capacity but solely
as Owner Trustee
By:
---------------------------------------
Name:
----------------------------------
Title:
---------------------------------
EXHIBIT B
FORM OF TRUST CERTIFICATE
[Begins on Next Page]
