ADMINISTRATION AGREEMENT
EXHIBIT
99.3
EXECUTION
COPY
This
ADMINISTRATION AGREEMENT, dated as of June 30, 2008 (as from time to time
amended, supplemented or otherwise modified and in effect, this “Agreement”), is
by and among MERRILL AUTO TRUST SECURITIZATION 2008-1, a Delaware statutory
trust (the “Issuer”), XXXXXXX XXXXX BANK USA, a Utah industrial bank, as
administrator (in such capacity, the “Administrator”), U.S. BANK NATIONAL
ASSOCIATION, a national banking association, as master servicer (the “Master
Servicer”), and CITIBANK, N.A., a national banking association, not in its
individual capacity but solely as Indenture Trustee (in such capacity, the
“Indenture Trustee”).
WHEREAS,
the Issuer is issuing the Notes pursuant to the Indenture and the Certificates
pursuant to the Amended and Restated Trust Agreement and has entered into
certain agreements in connection therewith, including (i) the Sale and
Servicing Agreement, dated as of June 30, 2008, among the Issuer, the Master
Servicer and the Depositor (the “Sale and Servicing Agreement”) and
(ii) the Indenture, dated as of June 30, 2008, among the Issuer, the
Indenture Trustee and the Securities Administrator (the “Indenture”, and
together with the Sale and Servicing Agreement, the “Related
Agreements”);
WHEREAS,
the Issuer, Owner Trustee and the Master Servicer desire to have the
Administrator perform certain duties of the Master Servicer under the Sale and
Servicing Agreement and to provide such additional services consistent with the
terms of this Agreement and the Related Agreements as the Issuer and the Owner
Trustee may from time to time request; and
WHEREAS,
the Administrator has the capacity to provide the services required hereby and
is willing to perform such services for the Issuer, Owner Trustee and the Master
Servicer on the terms set forth herein;
NOW,
THEREFORE, in consideration of the mutual covenants contained herein, and other
good and valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties hereto, intending to be legally bound, agree as
follows:
1. Definitions and
Usage. Except as otherwise specified herein or as the context
may otherwise require, capitalized terms used but not otherwise defined in this
Agreement (including the recitals) are defined in Appendix A to the
Sale and Servicing Agreement, which also contains rules as to usage that shall
be applicable herein.
2. Duties of the
Administrator. (a) The Administrator agrees to perform
all of its duties as Administrator, if any, that are expressly set forth to be
performed by it under the Sale and Servicing Agreement or the
Indenture.
(b)(A)In
addition to the foregoing, the Administrator shall repurchase any Receivable
pursuant to Section 3.6 of the Sale and Servicing Agreement, including payment
of the related Purchase Amount, as specified therein, to the extent that a
corresponding obligation to repurchase such Receivable does not exist or is not
exercisable under the related Receivables
Servicing
Agreement or, if the corresponding obligation does exist and is exercisable, the
Receivables Servicer has failed to perform in its repurchase obligation with
respect thereto, and upon any such repurchase by the Administrator, the Issuer
and the Master Service shall complete any assignments as may be necessary to
transfer the related Receivable to the Administrator and the Administrator shall
succeed to all rights of the Issuer and the Master Servicer to enforce any
repurchase or other remedies with respect to such Receivable as against the
Receivables Servicer.
(B) The
Administrator shall be responsible for the calculation of the aggregate Purchase
Amount of the Receivables pursuant to Section 8.1, and the timely reporting of
such information to the Master Servicer.
(c) In
addition to the foregoing, the Administrator shall take, in the name and on
behalf of the Issuer, all appropriate action that is the duty of the Issuer or
the Indenture Trustee to take, with respect to the following matters under the
Indenture (references are to sections of the Indenture):
(A) Upon
request, pursuant to Section 3.4, assist in the obtaining and preservation of
the Issuer’s qualification to do business in each jurisdiction in which such
qualification is or shall be necessary to protect the validity and
enforceability of the Indenture, the Notes, the Collateral and each other
instrument and agreement included in the Indenture Trust Estate, except as
provided in Section 3.18 of the Sale and Servicing Agreement.
(B) The
Administrator shall be responsible for the notification pursuant to Section 3.7
of an Event of Servicing Termination under the Sale and Servicing Agreement to
the extent it has actual knowledge of such event and, if such Event of Servicing
Termination arises from the failure of the Master Servicer to perform any of its
duties under the Sale and Servicing Agreement with respect to the Receivables,
upon the request of the Securities Administrator the taking of all reasonable
steps available to the Issuer to remedy such failure.
(C) The
Administrator shall, pursuant to Section 3.7, be responsible for the
notification to the Securities Administrator of (i) the termination of the
Master Servicer and (ii) the appointment of a Successor Master
Servicer.
(D)
Pursuant to Section 3.14, the Administrator shall have the duty to cause the
Master Servicer to comply with Sections 3.8, 3.9, 3.10, 3.11, 3.12, 3.13, 3.14
and 4.7 and Article VI of the Sale and Servicing Agreement.
(E) The
delivery of the written notice to the Indenture Trustee, the Securities
Administrator, the Counterparties and the Rating Agencies, set forth in Section
3.19, of each Event of Default under the Indenture and each default by the
Master Servicer under the Sale and Servicing Agreement.
(F)
Pursuant to Section 4.1, the monitoring of the Issuer’s obligations as to the
satisfaction and discharge of the Indenture and the preparation of an Officer’s
Certificate and the obtaining of an Opinion of Counsel and the Independent
Certificate relating thereto.
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(G)
Pursuant to Section 11.1(a), the preparation and delivery of all Opinions of
Counsel with respect to any request by the Issuer to the Indenture Trustee to
take any action under the Indenture.
(d) In
carrying out the foregoing duties or any of its other obligations under this
Agreement, the Administrator may enter into transactions or otherwise deal with
any of its Affiliates; provided, however, that the
terms of any such transactions or dealings shall be in accordance with any
directions received from the Issuer and shall be, in the Administrator’s
opinion, no less favorable to the Issuer than would be available from
unaffiliated parties.
3. Records. The
Administrator shall maintain appropriate books of account and records relating
to services performed hereunder, which books of account and records shall be
accessible for inspection by the Issuer, the Master Servicer and the Depositor
at any time during normal business hours.
4. Compensation. As
compensation for the performance of the Administrator’s obligations under this
Agreement and, as reimbursement for its expenses related thereto, the
Administrator shall be entitled to receive a fee, for each Collection Period
equal to all reinvestment income on all amounts on deposit in the Collection
Account. The Master Servicer shall pay such reinvestment income to
the Administrator monthly on the third Business Day of the calendar month next
commencing after the last day of such Collection Period, beginning with the
third Business Day of September, 2008. In addition, the Administrator
will receive on each Payment Date, a fee equal to one-twelfth of the
Administrator Fee Rate multiplied by the aggregate Principal Balance of the
Receivables as of the first day of the Collection Period which shall be payable
as provided in Section 8.2 of the Indenture.
5. Additional Matters Regarding
the Master Servicer. (a) The Administrator shall
furnish to the Master Servicer from time to time such additional information
regarding the Receivables as the Master Servicer shall reasonably request and
which the Administrator can obtain without unreasonable difficulty or expense,
and shall assist the Master Servicer in obtaining information from the
Receivables Servicer.
(b) In
the event that (i) the Master Servicer suffers any loss as a result of the
negligence or misconduct of the Receivables Servicer in the performance of its
duties under the Receivables Servicing Agreement, but (ii) the Master Servicer
is unable to obtain compensation for such loss pursuant to the indemnification
provisions of such Receivables Servicing Agreement or under the Sale and
Servicing Agreement, the Administrator shall indemnify the Master Servicer for
any such loss for which the Master Servicer was not indemnified by the
Receivables Servicer or reimbursed under the Sale and Servicing
Agreement.
(c) In
the event that (i) the information provided to the Master Servicer by the
Receivables Servicer contains any untrue statement of a material fact or omits
to state a material fact necessary to make the statements made, in light of the
circumstances under which such statements made, not misleading and (ii) the
Master Servicer suffers any loss as a result (notwithstanding the provisions of
Section 6.4 of the Sale and Servicing Agreement), and (iii) the Master Servicer
is unable to obtain compensation for such loss pursuant to the provisions of the
Receivables Servicing Agreement or under the Sale and Servicing Agreement, the
Administrator
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shall
indemnify the Master Servicer for any such loss for which the Master Servicer
was not indemnified by the Receivables Servicer or reimbursed under the Sale and
Servicing Agreement.
(d) In
the event that the Receivables Servicer fails to provide any report or
certification required by the Receivables Servicing Agreement in a timely
manner, which in the judgment of the Master Servicer prevents the Master
Servicer from preparing a certification or report required of the Master
Servicer, the Master Servicer shall notify the Administrator and take direction
from the Administrator whether the Master Servicer shall (i) proceed without
such information or certification for the Receivables Servicer, or (ii)
delay the filing of such report or certification pending receipt of
such information or certification from the Receivables Servicer, and in either
case the Administrator shall indemnify the Master Servicer for any loss as a
result of following the Administrator’s direction.
(e) The
indemnification rights of the Master Servicer as against the Administrator in
clauses (b), (c), and (d) of this Section 5, shall be subject to the limitations
set forth in clauses (i), (ii) and (iii) of Section 6.4(c) of the Sale and
Servicing Agreement. In addition, in no event shall the Administrator be liable
for special, indirect or consequential loss or damage of any kind whatsoever
(including but not limited to lost profits), even if the Administrator has been
advised of the likelihood of such loss or damage and regardless of the form of
action.
6. Independence of the
Administrator. For all purposes of this Agreement, the
Administrator shall be an independent contractor and shall not be subject to the
supervision of the Issuer, the Master Servicer, the Securities Administrator,
the Indenture Trustee or the Owner Trustee with respect to the manner in which
it accomplishes the performance of its obligations hereunder. Unless
expressly authorized by this Agreement, the Basic Documents, the Issuer or the
Master Servicer, the Administrator shall have no authority to act for or
represent the Issuer, the Master Servicer, the Indenture Trustee or the Owner
Trustee in any way and shall not otherwise be deemed an agent of the Issuer, the
Master Servicer, the Indenture Trustee or the Owner Trustee.
7. No Joint
Venture. Nothing contained in this Agreement (i) shall
constitute the Administrator and either of the Issuer, the Indenture Trustee,
the Master Servicer or the Owner Trustee as members of any partnership, joint
venture, association, syndicate, unincorporated business or other separate
entity, (ii) shall be construed to impose any liability as such on any of them
or (iii) shall be deemed to confer on any of them any express, implied or
apparent authority to incur any obligation or liability on behalf of the
others.
8. Other Activities of
Administrator. Nothing herein shall prevent the Administrator
or its Affiliates from engaging in other businesses or, in its sole discretion,
from acting in a similar capacity as an administrator for any other person or
entity even though such person or entity may engage in business activities
similar to those of the Issuer, the Master Servicer, the Owner Trustee or the
Indenture Trustee.
9. Term of Agreement;
Resignation and Removal of Administrator. (a) This Agreement
shall continue in force until the termination of the Issuer in accordance with
Section 9.01 of the Trust Agreement, upon which event this Agreement shall
automatically terminate.
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(b) Subject
to Sections 9(d) and 9(e), the Administrator may resign its duties hereunder by
providing the Issuer and the Indenture Trustee with at least sixty days’ prior
written notice.
(c) Subject
to Sections 9(d) and 9(e), at the sole option of the Issuer, the Administrator
may be removed immediately upon written notice of termination from the Issuer to
the Administrator (with a copy to the Indenture Trustee) if any of the following
events shall occur:
(i) the
Administrator shall default in any material respect in the performance of any of
its duties under this Agreement and, after notice of such default, shall not
cure such default within ten Business Days (or, if such default cannot be cured
in such time, such longer period acceptable to the Issuer); or
(ii) an
Insolvency Event with respect to the Administrator.
The
Administrator agrees that if any of the events specified in clauses (i) or (ii)
of this Section 9(c) shall occur, it shall give written notice thereof to the
Issuer and the Indenture Trustee within seven (7) Business Days after the
happening of such event.
(d) No
resignation or removal of the Administrator pursuant to this Section 9 shall be
effective until (i) a successor Administrator shall have been appointed by the
Issuer and (ii) such successor Administrator shall have agreed in writing to be
bound by the terms of this Agreement in the same manner as the Administrator is
bound hereunder. The Issuer shall provide written notice of any such
resignation or removal to the Indenture Trustee, with a copy to the Rating
Agencies.
(e) The
appointment of any successor Administrator shall be effective only after
satisfaction of the Rating Agency Condition with respect to the proposed
appointment.
10. Action upon Termination,
Resignation or Removal. Promptly upon the effective date of
termination of this Agreement pursuant to Section 9(a) or the resignation or
removal of the Administrator pursuant to Section 9(b) or (c), respectively, the
Administrator shall be entitled to be paid all fees and reimbursable expenses
accruing to it to the date of such termination, resignation or
removal. The Administrator shall forthwith upon such termination
pursuant to Section 9(a) deliver to the Issuer all property and documents of or
relating to the Collateral then in the custody of the
Administrator. In the event of the resignation or removal of the
Administrator pursuant to Section 9(b) or (c), respectively, the Administrator
shall cooperate with the Issuer and take all reasonable steps requested to
assist the Issuer in making an orderly transfer of the duties of the
Administrator.
11. Notices. Any
notice, report or other communication given hereunder shall be in writing and
addressed as follows:
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(a) if
to the Issuer or the Owner Trustee, to:
c/o U.S.
Bank Trust National Association
EP-MN-WS3D
00
Xxxxxxxxxx Xxxxxx
Xx. Xxxx,
Xxxxxxxxx 00000-0000
Attention: Xxx
Xxxxxx
Telephone:
(000) 000-0000
Facsimile:
(000) 000-0000
(b) if
to the Administrator, to:
XXXXXXX
XXXXX BANK USA
c/o
Merrill Xxxxx & Co.
000 Xxxxx
Xxxxxx,
00xx
Xxxxx
Xxx Xxxx,
Xxx Xxxx 00000
Attention:
Xxxxxx Xxxxxx
Telephone:
(000) 000-0000
Facsimile:
(000) 000-0000
(c) if
to the Indenture Trustee, to:
CITIBANK,
N.A.
000
Xxxxxxxxx, 00xx
Xxxxx
Xxx Xxxx,
Xxx Xxxx 00000
Attention:
Global Transaction Services -
Telephone:
0(000) 000-0000
Facsimile:
(000) 000-0000
or to
such other address as any party shall have provided to the other parties in
writing. Any notice required to be in writing hereunder shall be
deemed given if such notice is mailed by certified mail, postage prepaid, or
hand-delivered to the address of such party as provided above.
12. Amendments. This
Agreement may be amended from time to time by a written amendment duly executed
and delivered by the Issuer, the Master Servicer, the Administrator and the
Indenture Trustee, with the written consent of the Owner Trustee (which consent
shall not unreasonably be withheld, conditioned or delayed), without the consent
of the Noteholders and the Certificateholders, 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
Certificateholders; provided that such amendment will not materially and
adversely affect the interest of any Noteholder or Certificateholder (as
evidenced, upon request of the Indenture Trustee pursuant to Section 6.2 of the
Indenture, by an Opinion of Counsel). This Agreement may also be
amended by the Issuer, the Master Servicer, the Administrator and the Indenture
Trustee with the written consent of the Owner Trustee (which
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consent
shall not unreasonably be withheld) and the Noteholders of Notes evidencing not
less than a majority of the Notes Outstanding and the Certificateholders of
Certificates evidencing not less than a majority of the Certificate Percentage
Interest 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 Noteholders or the Certificateholders; 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 Receivables or
distributions that are required to be made for the benefit of the Noteholders or
Certificateholders or (ii) reduce the aforesaid percentage of the Noteholders
and Certificateholders which are required to consent to any such amendment,
without the consent of the Noteholders of all the Notes Outstanding and
Certificateholders of Certificates evidencing 100% of the Certificate Percentage
Interest. Promptly after the execution of any such amendment, the
Administrator shall furnish written notification of such amendment to each
Rating Agency.
The
Indenture Trustee, as a condition to consenting to any amendment hereunder, may
require an Opinion of Counsel, in form and substance satisfactory to the
Indenture Trustee, stating the legal effect of any such action, outlining the
steps required to complete the same, and concluding that all conditions
precedent to the taking of such action have been complied with.
13. Successors and
Assigns. This Agreement may not be assigned by the
Administrator unless such assignment is previously consented to in writing by
the Issuer, the Indenture Trustee and the Owner Trustee (which consent shall not
unreasonably be withheld, conditioned or delayed) and subject to the
satisfaction of the Rating Agency Condition in respect thereof. An
assignment with such consent and satisfaction, if accepted by the assignee,
shall bind the assignee hereunder in the same manner as the Administrator is
bound hereunder. Notwithstanding the foregoing, this Agreement may be
assigned by the Administrator without the consent of the Issuer, the Indenture
Trustee or the Owner Trustee to a corporation or other organization that is a
successor (by merger, consolidation or purchase of assets) to the Administrator;
provided that such successor organization executes and delivers to the Issuer,
the Master Servicer, the Owner Trustee and the Indenture Trustee an agreement in
which such corporation or other organization agrees to be bound hereunder by the
terms of said assignment in the same manner as the Administrator is bound
hereunder. Subject to the foregoing, this Agreement shall bind any successors or
assigns of the parties hereto.
14. GOVERNING
LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO CONFLICT
OF LAWS PROVISIONS THAT WOULD APPLY THE LAW OF A JURISDICTION OTHER THAN THE
STATE OF NEW YORK, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES
HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
15. Headings. The
Section headings hereof have been inserted for convenience of reference only and
shall not be construed to affect the meaning, construction or effect of this
Agreement.
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16. Counterparts. This
Agreement may be executed in counterparts, each of which when so executed shall
be an original, but all of which together shall constitute but one and the same
agreement.
17. Severability. Any
provision of this Agreement that is prohibited or unenforceable in any
jurisdiction shall be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof and any
such prohibition or unenforceability in any jurisdiction shall not invalidate or
render unenforceable such provision in any other jurisdiction.
18. No
Set-off. All payments required hereunder by the Administrator
shall be made without set-off or counterclaim of any nature.
19. Limitation of Liability of
Owner Trustee and Indenture Trustee. (a) Notwithstanding
anything contained herein to the contrary, this instrument has been signed on
behalf of the Issuer by U.S. Bank Trust National Association not in its
individual capacity but solely in its capacity as Owner Trustee of the Issuer
and in no event shall U.S. Bank Trust National Association in its individual
capacity or any beneficial owner of the Issuer have any liability for the
representations, warranties, covenants, agreements or other obligations of the
Issuer hereunder, as to all of which recourse shall be had solely to the assets
of the Issuer. For all purposes of this Agreement, in the performance
of any duties or obligations of the Issuer hereunder, the Owner Trustee shall be
subject to, and entitled to the benefits of, the terms and provisions of the
Trust Agreement.
(b) Notwithstanding
anything contained herein to the contrary, this Agreement has been countersigned
by Citibank, N.A., not in its individual capacity but solely as Indenture
Trustee and in no event shall Citibank, N.A., in its individual capacity or any
of its officers, directors, employees, representatives or agents have any
liability for the representations, warranties, covenants, agreements or other
obligations of the Issuer hereunder or in any of the certificates, notices or
agreements delivered pursuant hereto, as to all of which recourse shall be had
solely to the assets of the Issuer.
20. Third-Party
Beneficiary. The Owner Trustee is a third-party beneficiary to
this Agreement and is entitled to the rights and benefits hereunder and may
enforce the provisions hereof as if it was a party hereto.
21. Nonpetition
Covenants. Notwithstanding any prior termination of this
Agreement, neither the Administrator nor the Indenture Trustee shall, prior to
the date which is one year and one day after the termination of this Agreement
with respect to the Issuer, acquiesce, petition or otherwise invoke or cause the
Issuer to invoke the process of any court or government authority for the
purpose of commencing or sustaining a case against the Issuer under any federal
or State bankruptcy, insolvency or similar law or appointing a receiver,
liquidator, assignee, trustee, custodian, sequestrator or other similar official
of the Issuer or any substantial part of its property, or ordering the winding
up or liquidation of the affairs of the Issuer.
22. Rights of Indenture
Trustee. The Indenture Trustee shall be provided all of the
rights, protections, immunities and indemnities afforded it under the
Indenture.
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IN
WITNESS WHEREOF, the parties have caused this Administration Agreement to be
duly executed and delivered as of the day and year first above
written.
| MERRILL AUTO TRUST SECURITIZATION 2008-1 | ||||
|
|
By:
|
U.S.
BANK TRUST NATIONAL ASSOCIATION,
not
in its individual capacity but solely as Owner Trustee
|
||
| By: | /s/ X.X. Xxxxxxxx | |||
| Name: Xxxxx X. Xxxxxxxx | ||||
| Title: Vice President | ||||
| U.S.
BANK NATIONAL ASSOCIATION, as Master Servicer |
||||
| By: | /s/ X. X. Xxxxxxxx | |||
| Name: Xxxxx X. Xxxxxxxx | ||||
| Title: Vice President | ||||
|
CITIBANK,
N.A.,
not in its individual capacity but solely as Indenture Trustee |
||||
| By: | /s/ X. Xxxxxxxx | |||
| Name: Xxxxxxx Xxxxxxxx | ||||
| Title: Vice President | ||||
|
XXXXXXX
XXXXX BANK USA, as Administrator
|
||||
| By: | /s/ Xxxxxx Xxxxxx | |||
| Name: Xxxxxx Xxxxxx | ||||
| Title: Director | ||||
