Exhibit 4.1
TRUST AGREEMENT
between
ML ASSET BACKED CORPORATION,
as Depositor
and
[_______________________________________],
as Owner Trustee
Dated as of [_________], 200[__]
TABLE OF CONTENTS
Page
ARTICLE I
DEFINITIONS
Section 1.01. Capitalized Terms.............................................................................1
Section 1.02. Other Definitional Provisions.................................................................3
ARTICLE II
ORGANIZATION
Section 2.01. Name..........................................................................................3
Section 2.02. Office........................................................................................3
Section 2.03. Purposes and Powers...........................................................................4
Section 2.04. Appointment of Owner Trustee..................................................................4
Section 2.05. Initial Capital Contribution of Trust Estate..................................................4
Section 2.06. Declaration of Trust..........................................................................5
Section 2.07. Characterization of the Trust for Tax Purposes................................................5
Section 2.08. Liability of Certificateholders...............................................................5
Section 2.09. Title to Trust Property.......................................................................5
Section 2.10. Situs of Trust................................................................................5
Section 2.11. Representations, Warranties and Covenants of the Depositor....................................6
Section 2.12. Federal Income Tax Matters....................................................................7
ARTICLE III
TRUST CERTIFICATES AND TRANSFER OF INTERESTS
Section 3.01. Initial Ownership.............................................................................7
Section 3.02. The Trust Certificates........................................................................7
Section 3.03. Execution, Authentication and Delivery of Trust Certificates..................................8
Section 3.04. Registration of Certificates; Transfer and Exchange of Trust Certificates;
Limitations on Transfer.......................................................................8
Section 3.05. Mutilated, Destroyed, Lost or Stolen Trust Certificates......................................10
Section 3.06. Persons Deemed Owners........................................................................10
Section 3.07. Access to List of Certificateholders' Names and Addresses....................................11
Section 3.08. Maintenance of Office or Agency..............................................................11
Section 3.09. Appointment of Paying Agent..................................................................11
Section 3.10. Definitive Trust Certificates................................................................12
Section 3.11. Certificates Nonassessable and Fully Paid....................................................12
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ARTICLE IV
ACTIONS BY OWNER TRUSTEE
Section 4.01. Prior Notice with Respect to Certain Matters.................................................12
Section 4.02. Action by Certificateholders with Respect to Certain Matters.................................14
Section 4.03. Restrictions on Certificateholders' Power....................................................14
Section 4.04. Majority Control.............................................................................14
ARTICLE V
APPLICATION OF TRUST FUNDS; CERTAIN DUTIES
Section 5.01. Establishment of Trust Account...............................................................15
Section 5.02. Application of Trust Funds...................................................................15
Section 5.03. Method of Payment............................................................................16
Section 5.04. No Segregation of Moneys; No Interest........................................................16
Section 5.05. Accounting and Reports to Certificateholders, the Internal Revenue Service and Others........16
Section 5.06. Signature on Returns; Tax Matters Partner....................................................17
ARTICLE VI
AUTHORITY AND DUTIES OF OWNER TRUSTEE
Section 6.01. General Authority............................................................................17
Section 6.02. General Duties...............................................................................17
Section 6.03. Action upon Instruction......................................................................18
Section 6.04. No Duties Except as Specified in this Agreement or in Instructions...........................18
Section 6.05. No Action Except Under Specified Documents or Instructions...................................19
Section 6.06. Restrictions.................................................................................19
Section 6.07. Administrative Duties........................................................................19
ARTICLE VII
CONCERNING THE OWNER TRUSTEE
Section 7.01. Acceptance of Trusts and Duties..............................................................22
Section 7.02. Furnishing of Documents......................................................................23
Section 7.03. Representations and Warranties...............................................................23
Section 7.04. Reliance; Advice of Counsel..................................................................24
Section 7.05. Not Acting in Individual Capacity............................................................24
Section 7.06. Owner Trustee Not Liable for Trust Certificates or for Receivables...........................24
Section 7.07. Owner Trustee May Own Trust Certificates and Notes...........................................25
Section 7.08. Doing Business in Other Jurisdictions........................................................25
Section 7.09. Paying Agent, Certificate Registrar and Authenticating Agent.................................25
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ARTICLE VIII
COMPENSATION OF OWNER TRUSTEE
Section 8.01. Owner Trustee's Fees and Expenses............................................................26
Section 8.02. Indemnification..............................................................................26
Section 8.03. Payments to the Owner Trustee................................................................26
ARTICLE IX
TERMINATION OF TRUST AGREEMENT
Section 9.01. Termination of Trust Agreement...............................................................26
ARTICLE X
SUCCESSOR OWNER TRUSTEES AND ADDITIONAL OWNER TRUSTEES
Section 10.01. Eligibility Requirements for Owner Trustee...................................................28
Section 10.02. Resignation or Removal of Owner Trustee......................................................28
Section 10.03. Successor Owner Trustee......................................................................29
Section 10.04. Merger or Consolidation of Owner Trustee.....................................................29
Section 10.05. Appointment of Co-Trustee or Separate Trustee................................................30
ARTICLE XI
MISCELLANEOUS
Section 11.01. Supplements and Amendments...................................................................31
Section 11.02. No Legal Title to Trust Estate in Certificateholders.........................................32
Section 11.03. Limitations on Rights of Others..............................................................32
Section 11.04. Notices......................................................................................32
Section 11.05. Severability.................................................................................33
Section 11.06. Separate Counterparts........................................................................33
Section 11.07. Successors and Assigns.......................................................................33
Section 11.08. Covenants of the Depositor...................................................................33
Section 11.09. No Petition..................................................................................33
Section 11.10. No Recourse..................................................................................33
Section 11.11. Headings.....................................................................................33
Section 11.12. GOVERNING LAW................................................................................33
Section 11.13. Acceptance of Terms of Agreement.............................................................34
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EXHIBITS
Exhibit A Form of Trust Certificate...................................................................A-1
Exhibit B Form of Transferor Certificate..............................................................B-1
Exhibit C Form of Investment Letter...................................................................C-1
Exhibit D Form of Rule 144A Letter....................................................................D-1
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DEFINITIONS
Section 1.01. Capitalized Terms. For all purposes of this
Agreement, the following terms have the meanings set forth below:
"Agreement" means this Trust Agreement, as the same may be amended,
supplemented or otherwise modified from time to time.
"Bankruptcy Action" has the meaning assigned to such term in
Section 4.01.
"Certificate Distribution Account" has the meaning assigned to such
term in Section 5.01.
"Certificate of Trust" means the certificate of trust of the
Issuer.
"Certificate Register" and "Certificate Registrar" means the
register mentioned in and the registrar appointed pursuant to Section 3.04.
"Code" means the Internal Revenue Code of 1986, as amended, and the
Treasury Regulations promulgated thereunder.
"Depositor" means ML Asset Backed Corporation, and its successors,
in its capacity as depositor hereunder.
"Distribution Date" means the [__________] ([___]) day of each
calendar month or, if such day is not a Business Day, the next succeeding
Business Day.
"Expenses" has the meaning assigned to such term in Section 8.02.
"Holder" or "Certificateholder" means a Person in whose name a
Trust Certificate is registered in the Certificate Register; except that when
used in reference to the Notes, "Holder" shall have the meaning provided
therefor under the Indenture.
"Indemnified Parties" has the meaning assigned to such term in
Section 8.02.
"Indenture" means the Indenture, dated as of [__________], 200[__],
among the Trust, [__________________], as Indenture Trustee and
[__________________], as Securities Administrator, as amended, supplemented or
otherwise modified from time to time.
"Indenture Trustee" means [__________________], a national banking
association, not in its individual capacity, but as Indenture Trustee under the
Indenture, or any successor Indenture Trustee under the Indenture.
"Investment Letter" has the meaning assigned to such term in
Section 3.04.
"Owner Trustee" means [__________________], a [__________________],
not in its individual capacity but solely as owner trustee under this
Agreement, and any successor Owner Trustee hereunder.
"Paying Agent" means any paying agent or co-paying agent appointed
pursuant to Section 3.09 and shall initially be the Owner Trustee.
"Percentage Interest" means, as to any Trust Certificate, the
percentage interest, specified on the face thereof, in the distributions on the
Trust Certificates pursuant to this Agreement.
"Protected Purchaser" has the meaning set forth in Section 8-303 of
the UCC.
"Sale and Servicing Agreement" means the Sale and Servicing
Agreement dated as of [_________], 200[__], among the Trust, as issuer, the
Depositor, [__________________], as Master Servicer, and [__________________],
as Indenture Trustee, as the same may be amended, supplemented or otherwise
modified from time to time.
"Secretary of State" means the Secretary of State of the State of
Delaware.
"Securities Act" means the Securities Act of 1933, as amended.
"Securities Administrator" means [__________________], a national
banking association, not in its individual capacity but solely as Securities
Administrator under the Indenture, or any successor Securities Administrator
under the Indenture.
"Similar Law" means any foreign, federal, state or local law with
provisions substantially similar to Title I of ERISA or Section 4975 of the
Code.
"Statutory Trust Statute" means Chapter 38 of Title 12 of the
Delaware Code, 12 Del. Code xx.xx. 3801 et seq., as the same may be amended
from time to time.
"Transferor Certificate" has the meaning assigned to such term in
Section 3.04.
"Treasury Regulations" means regulations, including proposed or
temporary Regulations, promulgated under the Code. References herein to
specific provisions of proposed or temporary regulations shall include
analogous provisions of final Treasury Regulations or other successor Treasury
Regulations.
"Trust Certificates" means the certificates evidencing the
beneficial interest in the Trust, in the form of Exhibit A hereto.
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Section 1.02. Other Definitional Provisions.
(a) Capitalized terms used and not otherwise defined herein have
the meanings assigned to them in the Appendix A to the Sale and Servicing
Agreement.
(b) All terms defined in this Agreement and used in any instrument
governed hereby and in any certificate or other document made or delivered
pursuant hereto shall have the respective meanings ascribed thereto herein
unless such terms are otherwise defined in such certificate or other document.
(c) As used in this Agreement and in any certificate or other
document made or delivered pursuant hereto or thereto, accounting terms not
defined in this Agreement or in any such certificate or other document, and
accounting terms partly defined in this Agreement or in any such certificate or
other document to the extent not defined, shall have the respective meanings
given to them under generally accepted accounting principles. To the extent
that the definitions of accounting terms in this Agreement or in any such
certificate or other document are inconsistent with the meanings of such terms
under generally accepted accounting principles, the definitions contained in
this Agreement or in any such certificate or other document shall control.
(d) The words "hereof," "herein," "hereunder" and words of similar
import when used in this Agreement shall refer to this Agreement as a whole and
not to any particular provision of this Agreement; Section and Exhibit
references contained in this Agreement are references to Sections and Exhibits
in or to this Agreement unless otherwise specified; "or" includes "and/or"; and
the term "including" means "including without limitation".
(e) The definitions contained in this Agreement are applicable to
the singular and plural forms of such terms and to the masculine, feminine and
neuter genders of such terms.
(f) Any agreement, instrument or statute defined or referred to
herein or in any instrument or certificate delivered in connection herewith
means such agreement, instrument or statute as from time to time amended,
modified or supplemented and includes (in the case of agreements or
instruments) references to all attachments thereto and instruments incorporated
therein; references to a Person are also to its permitted successors and
assigns.
ARTICLE II
ORGANIZATION
Section 2.01. Name. The Trust heretofore created and continued
hereby is known as "[__________________] Trust 200[_]-[_]," in which name the
Owner Trustee may conduct the business of the Trust, make and execute contracts
and other instruments on behalf of the Trust and xxx and be sued.
Section 2.02. Office. The office of the Trust shall be in care of
the Owner Trustee at the Corporate Trust Office or at such other address in
Delaware as the Owner Trustee may designate by written notice to the
Certificateholders and the Depositor.
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Section 2.03. Purposes and Powers. The purpose of the Trust is to
engage in the following activities and the Owner Trustee acting on behalf of
the Trust shall have the power and authority:
(a) to issue the Notes pursuant to the Indenture and the Trust
Certificates pursuant to this Agreement and to sell the Notes and the Trust
Certificates, in each case in accordance with the Basic Documents;
(b) with the proceeds of the sale of the Notes and the Trust
Certificates, to purchase or otherwise acquire the Initial Receivables, to pay
the organizational, start-up and transactional expenses of the Trust and to pay
the balance of such proceeds to the Depositor pursuant to the Sale and
Servicing Agreement;
(c) to assign, grant, transfer, pledge, mortgage and convey the
Trust Estate pursuant to the Indenture and to hold, manage and distribute to
the Certificateholders pursuant to the terms of the Sale and Servicing
Agreement any portion of the Trust Estate released from the Lien of, and
remitted to the Trust pursuant to, the Indenture;
(d) to enter into and perform its obligations under the Basic
Documents to which it is to be a party;
(e) to engage in those activities, including entering into
agreements, that are necessary, suitable or convenient to accomplish the
foregoing or are incidental thereto or connected therewith; and
(f) subject to compliance with the Basic Documents, to engage in
such other activities as may be required in connection with conservation of the
Trust Estate and the making of distributions to the Certificateholders and the
Noteholders.
The Owner Trustee acting on behalf of the Trust is hereby
authorized to engage in the foregoing activities. The Trust shall not engage in
any activity other than in connection with the foregoing or other than as
required or authorized by the terms of this Agreement or the other Basic
Documents. Specifically, the Owner Trustee, on behalf of the Trust, shall have
no authority to engage in any business operation, acquire any assets other than
those specifically included in the Trust Property or the Owner Trust Estate
under Article II of the Sale and Servicing Agreement or otherwise vary the
assets held by the Trust, except as authorized by the terms of this Agreement
or the other Basic Documents.
Section 2.04. Appointment of Owner Trustee. The Depositor hereby
confirms the appointment of the Owner Trustee as trustee of the Trust effective
as of the date of creation of the Trust, to have all the rights, powers and
duties set forth herein.
The Owner Trustee may engage, in the name of the Trust or in its
own name on behalf of the Trust, in the activities of the Trust, make and
execute contracts on behalf of the Trust and xxx on behalf of the Trust.
Section 2.05. Initial Capital Contribution of Trust Estate. The
Depositor hereby sells, assigns, transfers, conveys and sets over to the Owner
Trustee, as of the date hereof, the
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sum of $1. The Owner Trustee hereby acknowledges receipt in trust from the
Depositor, as of the date hereof, of the foregoing contribution, which shall
constitute the initial Trust Estate and shall be deposited in the Certificate
Distribution Account. The Depositor shall pay organizational expenses of the
Trust as they may arise or shall, upon the request of the Owner Trustee,
promptly reimburse the Owner Trustee for any such expenses paid by the Owner
Trustee.
Section 2.06. Declaration of Trust. The Owner Trustee hereby
declares that it will hold the Trust Estate in trust upon and subject to the
conditions set forth herein for the use and benefit of the Certificateholders,
subject to the obligations of the Trust under the Basic Documents. Effective as
of the date hereof, the Owner Trustee shall have all rights, powers and duties
set forth herein and in the Statutory Trust Statute with respect to
accomplishing the purposes of the Trust. The Owner Trustee has filed the
Certificate of Trust with the Secretary of State of the State of Delaware.
Section 2.07. Characterization of the Trust for Tax Purposes. It is
the intention of the parties hereto that (i) the Trust constitute a statutory
trust under the Statutory Trust Statute and that this Agreement constitute the
governing instrument of such statutory trust and (ii) for federal, state and
local income and franchise tax purposes, the Trust shall be treated as a
grantor trust of the type described in Treasury Regulation ss. 301.7701-4(c),
with the assets of the Trust being the Receivables and other assets held by the
Trust, and the Notes being non-recourse debt of the Certificateholders,
provided that if the Trust is not properly characterized as a grantor trust of
the type described in Treasury Regulation ss. 301.7701-4(c) (i.e., if one or
more classes of Notes are treated as equity in the Trust for federal income tax
purposes), the Trust shall be treated for federal, state and local income and
franchise tax purposes as a partnership (other than an association or publicly
traded partnership), with the assets of the partnership being the Receivables
and other assets held by the Trust, the partners of the partnership being the
Certificateholders and the Holders of the Notes that are treated as equity in
the Trust, and the remaining Notes constituting indebtedness of the
partnership. The parties agree that, unless otherwise required by the
appropriate tax authorities, the Trust will file or cause to be filed annual or
other necessary returns, reports and other forms consistent with the foregoing
characterization of the Trust for such tax purposes.
Section 2.08. Liability of Certificateholders. The
Certificateholders (including the Depositor or any Affiliate thereof) shall be
entitled to the same limitation of personal liability extended to stockholders
of private corporations for profit organized under the general corporation law
of the State of Delaware.
Section 2.09. Title to Trust Property. Subject to the Indenture,
legal title to all the Trust Estate shall be vested at all times in the Owner
Trustee, in its capacity as trustee for the Trust, in accordance with Section
3805(f) of the Statutory Trust Statute, with the same effect as if such
property were held in the name of the Trust as a separate legal entity.
Section 2.10. Situs of Trust. The Trust will be located in the
State of Delaware and administered in the States of Delaware, New York or
[__________________]. All bank accounts maintained by the Owner Trustee on
behalf of the Trust shall be located in the States of Delaware, New York or
[__________________]. The Trust shall not have any employees;
5
provided, however, that nothing herein shall restrict or prohibit the Owner
Trustee from having employees within or without the State of Delaware. Payments
will be received by the Trust only in Delaware, New York or
[__________________], and payments will be made by the Trust only from
Delaware, New York or [__________________]. The only office of the Trust will
be at the Corporate Trust Office.
Section 2.11. Representations, Warranties and Covenants of the
Depositor. The Depositor hereby represents and warrants to the Owner Trustee
that:
(a) The Depositor is duly organized and validly existing as a
corporation in good standing under the laws of the State of Delaware, with
power and authority to own its properties and to conduct its business as such
properties are currently owned and such business is presently conducted.
(b) The Depositor is duly qualified to do business as a foreign
corporation in good standing and has obtained all necessary licenses and
approvals in all jurisdictions in which the ownership or lease of its property
or the conduct of its business shall require such qualifications.
(c) The Depositor has the power and authority to execute and
deliver this Agreement and to carry out its terms; the Depositor has full power
and authority to transfer and assign the property to be transferred and
assigned to and deposited with the Trust and the Depositor has duly authorized
such transfer and assignment and deposit to the Trust by all necessary
corporate action; and the execution, delivery and performance of this Agreement
have been duly authorized by the Depositor by all necessary corporate action.
(d) The Depositor has duly executed and delivered this Agreement,
and this Agreement constitutes a legal, valid and binding obligation of the
Depositor, enforceable against the Depositor, in accordance with its terms.
(e) The consummation of the transactions contemplated by this
Agreement and the fulfillment of the terms hereof do not (i) conflict with,
result in any breach of any of the terms and provisions of, or constitute (with
or without notice or lapse of time) a default under, the certificate of
incorporation or the by-laws of the Depositor, or any indenture, agreement or
other instrument to which the Depositor is a party or by which it is bound,
(ii) result in the creation or imposition of any Lien upon any of its
properties pursuant to the terms of any such indenture, agreement or other
instrument (other than pursuant to the Basic Documents) or (iii) violate any
law or, to the best of the Depositor's knowledge, any order, rule or regulation
applicable to the Depositor of any court or of any federal or state regulatory
body, administrative agency or other governmental instrumentality having
jurisdiction over the Depositor or its properties.
(f) There are no proceedings or investigations pending or
threatened before any court, regulatory body, administrative agency or other
governmental instrumentality having jurisdiction over the Depositor or its
properties (i) asserting the invalidity of this Agreement, (ii) seeking to
prevent the consummation of any of the transactions contemplated by this
Agreement or (iii) seeking any determination or ruling that might materially
and adversely affect the
6
performance by the Depositor of its obligations under, or the validity or
enforceability of, this Agreement.
(g) The representations and warranties of the Depositor in Section
5.1 of the Sale and Servicing Agreement are true and correct.
Section 2.12. Federal Income Tax Matters. (a) The
Certificateholders acknowledge that it is their intent and that they understand
it is the intent of the Depositor that, for federal, state and local income and
franchise tax purposes, the Trust shall be treated as a grantor trust of the
type described in Treasury Regulation ss. 301.7701-4(c). The Depositor hereby
agrees and each Certificateholder by acceptance of a Trust Certificate agrees
to such treatment and each agrees to take no action inconsistent with such
treatment as a grantor trust. If the Trust is not properly characterized as a
grantor trust of the type described in Treasury Regulation ss. 301.7701-4(c)
(i.e., to the extent that one or more classes of Notes are treated as equity
for federal income tax purposes), the Trust will be treated as a partnership
(other than an association or publicly traded partnership) for federal, state
and local income and franchise tax purposes, and income, gain or loss of the
Trust for such month as determined for federal income tax purposes shall be
allocated among the Certificateholders as of the Record Date occurring within
such month, in proportion to their ownership of the Certificate Percentage
Interest on such date.
(b) Each Certificateholder agrees to provide to the Trust (a) an
IRS Form W-9 (or other similar or successor form) as is necessary to establish
an exemption from United States federal backup withholding with respect to such
Certificateholder (i) on or promptly after the date hereof (or, if later, the
date on which it becomes a Certificateholder hereunder) and (ii) upon the
occurrence of any event that would require the amendment or resubmission of any
such Form previously provided hereunder and such other forms or information in
connection therewith reasonably requested by the Trust.
(c) The Trust is authorized to modify the allocations in this
paragraph if necessary or appropriate, in its sole discretion, for the
allocations to fairly reflect the economic income, gain or loss to the
Certificateholders, or as otherwise required by the Code.
ARTICLE III.
TRUST CERTIFICATES AND TRANSFER OF INTERESTS
Section 3.01. Initial Ownership. Upon the formation of the Trust by
the execution of the Original Trust Agreement and until the issuance of the
Trust Certificates, the Depositor shall be the sole beneficiary of the Trust.
Section 3.02. The Trust Certificates.
(a) The Trust Certificates shall be issued in minimum denominations
of a one percent (1%) Percentage Interest in the Trust. The Trust Certificates
shall be executed on behalf of the Trust by manual or facsimile signature of an
authorized officer of the Owner Trustee. Trust Certificates bearing the manual
or facsimile signatures of individuals who were, at the time when such
signatures shall have been affixed, authorized to sign on behalf of the Trust,
shall be
7
validly issued and entitled to the benefit of this Agreement and shall be valid
and binding obligations of the Trust, notwithstanding that such individuals or
any of them shall have ceased to be so authorized prior to the authentication
and delivery of such Trust Certificates or did not hold such offices at the
date of authentication and delivery of such Trust Certificates.
(b) A transferee of a Trust Certificate, if any, shall become a
Certificateholder, shall become bound by this Agreement and shall be entitled
to the rights and subject to the obligations of a Certificateholder hereunder
upon such transferee's acceptance of a Trust Certificate duly registered in
such transferee's name pursuant to Section 3.04.
Section 3.03. Execution, Authentication and Delivery of Trust
Certificates. On the Closing Date, the Owner Trustee shall cause the Trust
Certificates in an aggregate Percentage Interest equal to 100% to be executed
on behalf of the Trust and authenticated by the Owner Trustee on behalf of the
Trust and delivered to or upon the written order of the Depositor, in
authorized denominations. No Trust Certificate shall entitle the related
Certificateholder to any benefit under this Agreement or be valid for any
purpose unless there shall appear on such Trust Certificate a certificate of
authentication substantially in the form set forth in Exhibit A, executed by
the Owner Trustee, by manual signature; such authentication shall constitute
conclusive evidence that such Trust Certificate shall have been duly
authenticated and delivered hereunder. All Trust Certificates shall be dated
the date of their authentication.
When a Trust Certificate is duly executed and issued by the Owner
Trustee and duly authenticated in accordance with this Agreement, the Trust
Certificate will be fully paid, validly issued, nonassessable and entitled to
the benefits of this Agreement.
Section 3.04. Registration of Certificates; Transfer and Exchange
of Trust Certificates; Limitations on Transfer. (a) The Certificate Registrar
shall keep or cause to be kept, at the office or agency maintained pursuant to
Section 3.08, a Certificate Register in which, subject to such reasonable
regulations as it may prescribe, the Trust shall provide for the registration
of Trust Certificates and of transfers and exchanges of Trust Certificates as
herein provided. The Owner Trustee shall be the initial Certificate Registrar.
No transfer of a Trust Certificate shall be recognized except upon registration
of such transfer in the Certificate Register.
The Trust Certificates have not been and will not be registered under the
Securities Act and will not be listed on any exchange. No transfer of a Trust
Certificate shall be made unless such transfer is made pursuant to an effective
registration statement under the Securities Act and any applicable state
securities laws or is exempt from the registration requirements under the
Securities Act and such state securities laws. In the event that a transfer is
to be made in reliance upon an exemption from the Securities Act and state
securities laws, in order to assure compliance with the Securities Act and such
laws, the Certificateholder desiring to effect such transfer and such
Certificateholder's prospective transferee shall each certify to the Owner
Trustee in writing the facts surrounding the transfer in substantially the
forms set forth in Exhibit B (the "Transferor Certificate") and either Exhibit
C (the "Investment Letter") or Exhibit D (the "Rule 144A Letter"). The
Depositor shall provide to any Certificateholder and any prospective transferee
designated by any such Certificateholder, information regarding the Trust
Certificates and, based solely on information received from the Master
Servicer, the
8
Receivables Servicers and, to the extent reasonably obtainable by the
Depositor, such other information as shall be necessary to satisfy the
condition to eligibility set forth in Rule 144A(d)(4) for transfer of any such
Trust Certificate without registration thereof under the Securities Act
pursuant to the registration exemption provided by Rule 144A. Each
Certificateholder desiring to effect such a transfer shall, and does hereby
agree to, indemnify the Trust, the Owner Trustee, and the Depositor against any
liability that may result if the transfer is not so exempt or is not made in
accordance with federal and state securities laws. The Owner Trustee shall
cause each Trust Certificate to contain a legend in the form set forth on the
form of Trust Certificate attached hereto as Exhibit A.
(b) With respect to each transfer of a Trust Certificate, the
prospective transferee shall be deemed to represent the following:
(i) It is not, and each account (if any) for which it is
purchasing the Trust Certificates is not (1) an employee benefit plan, as
defined in Section 3(3) of ERISA, that is subject to Title I of ERISA,
(2) a plan described in Section 4975(e)(1) of the Code that is subject to
Section 4975 of the Code, (3) a governmental plan, as defined in Section
3(32) of ERISA, subject to any federal, State or local law which is, to a
material extent, similar to the provisions of Section 406 of ERISA or
Section 4975 of the Code, (4) an entity whose underlying assets include
plan assets by reason of a plan's investment in the entity (within the
meaning of Department of Labor Regulation 29 C.F.R. Section 2510.3-101 or
otherwise under ERISA) or (5) a person investing "plan assets" of any
such plan (including without limitation, for purposes of this clause (5),
an insurance company general account, but excluding any entity registered
under the Investment Company Act of 1940, as amended).
(ii) It understands that any purported transfer of any Trust
Certificate (or any interest therein) to any Person who does not meet the
conditions of paragraph (i) above shall be, to the fullest extent
permitted by law, void ab initio, and the purported transferee in such a
transfer shall not be recognized by the Trust or any other Person as a
Certificateholder for any purpose.
(c) Upon surrender for registration of transfer of any Trust
Certificate at the office or agency maintained pursuant to Section 3.08 and
upon compliance with any provisions of this Agreement relating to such
transfer, the Owner Trustee shall execute, authenticate and deliver, in the
name of the designated transferee or transferees, one or more new Trust
Certificates of a like Certificate Percentage Interest dated the date of
authentication by the Owner Trustee or any authenticating agent. At the option
of a Certificateholder, Trust Certificates may be exchanged for other Trust
Certificates of a like Certificate Percentage Interest upon surrender of the
Trust Certificates to be exchanged at the office or agency maintained pursuant
to Section 3.08.
Every Trust Certificate presented or surrendered for registration of
transfer or exchange shall be accompanied by a written instrument of transfer
in form satisfactory to the Owner Trustee and the Certificate Registrar, duly
executed by the related Certificateholder or such Certificateholder's attorney
duly authorized in writing. Each Trust Certificate surrendered for
9
registration of transfer or exchange shall be cancelled and subsequently
disposed of by the Certificate Registrar in accordance with its customary
practice.
No service charge shall be made for any registration of transfer or
exchange of Trust Certificates, but the Owner Trustee or the Certificate
Registrar may require payment of a sum sufficient to cover any tax or
governmental charge that may be imposed in connection with any transfer or
exchange of Certificates.
The preceding provisions of this Section 3.04 notwithstanding, the Owner
Trustee shall not make and the Certificate Registrar need not register any
transfer or exchange of Trust Certificates for a period of 15 days preceding
any Payment Date for any payment with respect to the Trust Certificates.
Section 3.05. Mutilated, Destroyed, Lost or Stolen Trust
Certificates.
(a) If (i) any mutilated Trust Certificate shall be surrendered to
the Certificate Registrar, or if the Certificate Registrar shall receive
evidence to its satisfaction of the destruction, loss or theft of any Trust
Certificate and (ii) there shall be delivered to the Certificate Registrar and
the Owner Trustee such security or indemnity as may be required by them to save
each of them harmless, then in the absence of written notice that such Trust
Certificate has been acquired by a protected purchaser, the Owner Trustee, on
behalf of the Trust, shall execute and the Owner Trustee shall authenticate and
deliver, in exchange for or in lieu of any such mutilated, destroyed, lost or
stolen Trust Certificate, a new Trust Certificate of like tenor and
denomination. If, after the delivery of such replacement Certificate or payment
of a destroyed, lost or stolen Certificate, a Protected Purchaser of the
original Certificate in lieu of which such replacement Certificate was issued
presents for payment such original Certificate, the Trust and the Owner Trustee
shall be entitled to recover such replacement Certificate (or such payment)
from the Person to whom such replacement Certificate was delivered or any
assignee of such Person, except a Protected Purchaser, and shall be entitled to
recover upon the security or indemnity provided therefor to the extent of any
loss, damage, cost or expense incurred by the Trust or the Owner Trustee. In
connection with the issuance of any new Trust Certificate under this Section,
the Owner Trustee or the Certificate Registrar may require the payment of a sum
sufficient to cover any tax or other governmental charge that may be imposed in
connection therewith. Any duplicate Trust Certificate issued pursuant to this
Section shall constitute conclusive evidence of ownership in the Trust, as if
originally issued, whether or not the lost, stolen or destroyed Trust
Certificate shall be found at any time.
(b) The provisions of this Section are exclusive and shall preclude
(to the extent lawful) all other rights and remedies with respect to the
replacement or payment of mutilated, destroyed, lost or stolen Certificates.
Section 3.06. Persons Deemed Owners. Prior to due presentation of a
Trust Certificate for registration of transfer, the Owner Trustee, the
Certificate Registrar or any Paying Agent may treat the Person in whose name
any Trust Certificate is registered in the Certificate Register as the owner of
such Trust Certificate for the purpose of receiving distributions pursuant to
Section 5.02 and for all other purposes whatsoever, and none of the Owner
Trustee, the Certificate Registrar or any Paying Agent shall be bound by any
notice to the contrary.
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Section 3.07. Access to List of Certificateholders' Names and
Addresses. The Owner Trustee shall furnish or cause to be furnished to the
Master Servicer, the Paying Agent and the Depositor, within 15 days after
receipt by the Owner Trustee of a written request therefor from the Master
Servicer, the Paying Agent or the Depositor, a list, in such form as the Master
Servicer or the Depositor may reasonably require, of the names and addresses of
the Certificateholders as of the most recent Record Date. The Certificate
Registrar shall also furnish to the Owner Trustee and the Paying Agent a copy
of such list at any time there is a change therein. If (i) three or more
Certificateholders or (ii) one or more Certificateholders evidencing not less
than 25% of the Certificate Percentage Interests apply in writing to the Owner
Trustee, and such application states that the applicants desire to communicate
with other Certificateholders with respect to their rights under this Agreement
or under the Trust Certificates and such application is accompanied by a copy
of the communication that such applicants propose to transmit, then the Owner
Trustee shall, within five Business Days after the receipt of such application,
afford such applicants access during normal business hours to the current list
of Certificateholders. Each Certificateholder, by receiving and holding a Trust
Certificate, shall be deemed to have agreed not to hold any of the Depositor,
the Certificate Registrar or the Owner Trustee accountable by reason of the
disclosure of its name and address, regardless of the source from which such
information was derived. The Certificate Registrar shall upon the request of
the Owner Trustee provide such list, or access to such list, of
Certificateholders as contemplated by this Section 3.07.
Section 3.08. Maintenance of Office or Agency. The Owner Trustee
shall designate an office or offices or agency or agencies located in the
United States where Trust Certificates may be surrendered for registration of
transfer or exchange and where notices and demands to or upon the Owner Trustee
in respect of the Trust Certificates and the Basic Documents may be served. The
Owner Trustee initially designates the Corporate Trust Office of the Owner
Trustee as the office for such purposes. The Owner Trustee shall give prompt
written notice to the Depositor and the Certificateholders of any change in the
location of the Certificate Register or any such office or agency.
Section 3.09. Appointment of Paying Agent. The Paying Agent shall
make distributions to Certificateholders from the Certificate Distribution
Account pursuant to Section 5.02 and shall report the amounts of such
distributions to the Owner Trustee. Any Paying Agent shall have the revocable
power to withdraw funds from the Certificate Distribution Account for the
purpose of making the distributions referred to above. The Owner Trustee may
revoke such power and remove the Paying Agent if the Owner Trustee determines
in its sole discretion that the Paying Agent shall have failed to perform its
obligations under this Agreement in any material respect. The Paying Agent
initially shall be the Owner Trustee or, as provided in the Sale and Servicing
Agreement, the Securities Administrator. As Paying Agent, the Owner Trustee
shall hold all sums, if any, held by it for payment to the Certificateholders
in trust for the benefit of the Certificateholders entitled thereto until such
sums shall be paid to such Certificateholders. Any Paying Agent other than the
Owner Trustee shall be permitted to resign as Paying Agent upon 30 days' prior
written notice to the Owner Trustee. In the event that the Owner Trustee shall
no longer be the Paying Agent, the Owner Trustee shall appoint a successor to
act as Paying Agent (which shall be a bank or trust company). The Owner Trustee
shall cause such successor Paying Agent or any additional Paying Agent
appointed hereunder to execute and deliver to the Owner Trustee an instrument
in which such successor Paying Agent or additional
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Paying Agent shall agree with the Owner Trustee that, as Paying Agent, such
successor Paying Agent or additional Paying Agent will hold all sums, if any,
held by it for payment to the Certificateholders in trust for the benefit of
the Certificateholders entitled thereto until such sums shall be paid to such
Certificateholders. The Paying Agent shall return all unclaimed funds to the
Owner Trustee and upon resignation or removal of a Paying Agent such Paying
Agent shall also return all funds in its possession to the Owner Trustee. The
provisions of Sections 7.01, 7.03, 7.04, 8.01 and 8.02 shall apply to the Owner
Trustee in its role of Paying Agent and Certificate Registrar, for so long as
the Owner Trustee shall act as Paying Agent and Certificate Registrar and, to
the extent applicable, to any other paying agent appointed hereunder. Any
reference in this Agreement to the Paying Agent shall include any co-paying
agent unless the context requires otherwise.
Section 3.10. Definitive Trust Certificates. The Trust
Certificates, upon original issuance, will be issued in the form of a
typewritten Trust Certificate or Trust Certificates in substantially the form
attached hereto as Exhibit A to be delivered to the related Certificateholders,
by, or on behalf of, the Trust. Such Trust Certificate or Trust Certificates
shall be registered on the Certificate Register in the name of the Holder
thereof. The Trust Certificates shall be printed, lithographed, typewritten or
engraved or may be produced in any other manner as is reasonably acceptable to
the Owner Trustee, as evidenced by its execution thereof.
Section 3.11. Certificates Nonassessable and Fully Paid.
Certificateholders shall not be personally liable for obligations of the Trust.
The interests represented by the Trust Certificates shall be nonassessable for
any losses or expenses of the Trust or for any reason whatsoever, and, upon the
authentication thereof by the Owner Trustee pursuant to Section 3.03, 3.04 or
3.05, the Trust Certificates are and shall be deemed fully paid.
ARTICLE IV
ACTIONS BY OWNER TRUSTEE
Section 4.01. Prior Notice with Respect to Certain Matters. With
respect to the following matters, the Owner Trustee shall not take action
unless at least 30 days before the taking of such action, the Owner Trustee
shall have notified the Certificateholders of record as of the preceding Record
Date in writing of the proposed action and such Certificateholders specified in
Section 4.04 hereof shall not have notified the Owner Trustee in writing prior
to the thirtieth 30th day after such notice is given that such
Certificateholders have withheld consent or provided alternative direction:
(a) the initiation of any claim or lawsuit by the Owner Trustee
(except claims or lawsuits brought in connection with the collection of the
Receivables) and the compromise of any action, claim or lawsuit brought by or
against the Owner Trustee (except with respect to the aforementioned claims or
lawsuits for collection of the Receivables);
(b) the election by the Owner Trustee to file an amendment to the
Certificate of Trust (unless such amendment is required to be filed under the
Statutory Trust Statute);
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(c) the amendment of the Indenture by a supplemental indenture or
any other change to this Agreement or any other Basic Document in circumstances
where the consent of any Noteholder is required;
(d) the amendment of the Indenture by a supplemental indenture or
any other change to this Agreement or any other Basic Document in circumstances
where the consent of any Noteholder is not required and such amendment would
materially adversely affect the interests of the Certificateholders;
(e) the appointment pursuant to the Indenture of a successor Note
Registrar, Paying Agent or Indenture Trustee or pursuant to this Agreement of a
successor Certificate Registrar, or the consent to the assignment by the Note
Registrar, Paying Agent, Indenture Trustee or Certificate Registrar of its
obligations under the Indenture or this Agreement, as applicable;
(f) the consent to the calling or waiver of any default of any
Basic Document;
(g) the consent to the assignment by the Indenture Trustee or the
Master Servicer of their respective obligations under any Basic Document,
unless permitted in the Basic Documents;
(h) except as provided in Article IX hereof, dissolve, terminate or
liquidate the Trust in whole or in part;
(i) merge or consolidate the Trust with or into any other entity,
or convey or transfer all or substantially all of the Trust's assets to any
other entity;
(j) cause the Trust to incur, assume or guaranty any indebtedness
other than as set forth in this Agreement or the other Basic Documents;
(k) do any act that conflicts with any other Basic Document;
(l) do any act that would make it impossible to carry on the
ordinary business of the Trust as described in Section 2.03;
(m) confess a judgment against the Trust;
(n) possess Trust assets, or assign the Trust's right to property,
for other than a Trust purpose;
(o) cause the Trust to lend any funds to any entity, unless
permitted in the Basic Documents; or
(p) change the Trust's purpose and powers from those set forth in
this Trust Agreement.
In addition, the Trust shall not commingle its assets with those of
any other entity except, to the extent permitted hereunder, with the Owner
Trustee. The Trust shall maintain its
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financial and accounting books and records separate from those of any other
entity. Except as expressly set forth herein, the Trust shall not pay the
indebtedness, operating expenses and liabilities of any other entity. The Trust
shall maintain appropriate minutes or other records of all appropriate actions
and shall maintain its office separate from the offices of the Depositor and
the Master Servicer.
The Owner Trustee shall not have the power, except upon the written
direction of the Certificateholders pursuant to Section 4.04, and to the extent
otherwise consistent with the Basic Documents and permitted by applicable law,
to (i) institute proceedings to have the Owner Trustee or the Trust declared or
adjudicated bankrupt or insolvent, (ii) consent to the institution of
bankruptcy or insolvency proceedings against the Owner Trustee or the Trust,
(iii) file a petition or consent to a petition seeking reorganization or relief
on behalf of the Owner Trustee or the Trust under any applicable federal or
state law relating to bankruptcy, (iv) consent to the appointment of a
conservator, receiver, liquidator, assignee, trustee, sequestrator (or any
similar official) of the Owner Trustee or the Trust or a substantial portion of
the property of the Owner Trustee or the Trust, (v) make any assignment for the
benefit of the Owner Trustee's or the Trust's creditors, (vi) cause the Owner
Trustee or the Trust to admit in writing its inability to pay its debts
generally as they become due, or (vii) take any action, or cause the Owner
Trustee or the Trust to take any action, in furtherance of any of the foregoing
(any of the above, a "Bankruptcy Action"). So long as the Indenture remains in
effect and to the fullest extent permitted by applicable law, no
Certificateholder shall have the power to take, and shall not take, any
Bankruptcy Action with respect to the Owner Trustee or the Trust or direct the
Owner Trustee to take any Bankruptcy Action with respect to the Owner Trustee
or the Trust. Additionally, the Owner Trustee shall not have the power to
commence a Bankruptcy Action without the unanimous prior approval of all
Certificateholders and the delivery to the Owner Trustee by each such
Certificateholder of a certification certifying that such Certificateholder
reasonably believes that the Trust is insolvent.
Section 4.02. Action by Certificateholders with Respect to Certain
Matters. The Owner Trustee shall not have the power, except upon the written
direction of (a) the Certificateholders owning 25% Certificate Percentage
Interest, to remove the Master Servicer pursuant to Section 7.1 under the Sale
and Servicing Agreement or (b) Certificateholders owning 100% Certificate
Percentage Interest, to amend the Sale and Servicing Agreement pursuant to the
proviso to Section 9.1(b). In addition, the Owner Trustee shall not have the
power, except upon the written direction of the Certificateholders, except as
expressly provided in the Basic Documents, sell the Receivables after the
termination of the Indenture.
Section 4.03. Restrictions on Certificateholders' Power. The
Certificateholders shall not direct the Owner Trustee to take or to refrain
from taking any action if such action or inaction would be contrary to any
obligation of the Trust or the Owner Trustee under this Agreement (including
Section 2.03 hereof) or any of the other Basic Documents; nor shall the Owner
Trustee be obligated to follow any such direction, if given.
Section 4.04. Majority Control. Except as expressly provided
herein, any action that may be taken by the Certificateholders under this
Agreement may be taken by the Certificateholders evidencing not less than a
majority of the Certificate Percentage Interests. Except as expressly provided
herein, any written notice of the Certificateholders delivered
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pursuant to this Agreement shall be effective if signed by Holders of Trust
Certificates evidencing not less than a majority of the Certificate Percentage
Interests at the time of the delivery of such notice.
ARTICLE V
APPLICATION OF TRUST FUNDS; CERTAIN DUTIES
Section 5.01. Establishment of Trust Account. The Paying Agent
shall establish and maintain on behalf of the Trust an Eligible Deposit Account
(the "Certificate Distribution Account"), bearing a designation clearly
indicating that the funds deposited therein are held for the benefit of the
Certificateholders. The title of the Certificate Distribution Account shall be
"[__________________] Trust 200[_]-[_]: Certificate Distribution Account for
the benefit of the Certificateholders."
The Trust shall possess all right, title and interest in all funds
on deposit from time to time in the Certificate Distribution Account and in all
proceeds thereof. Except as otherwise expressly provided herein, the
Certificate Distribution Account shall be under the sole dominion and control
of the Owner Trustee, on behalf of the Trust, for the benefit of the
Certificateholders. If, at any time, the Certificate Distribution Account
ceases to be an Eligible Deposit Account, the Owner Trustee (or the Depositor
on behalf of the Owner Trustee, if the Certificate Distribution Account is not
then held by the Owner Trustee or an affiliate thereof) shall within ten
Business Days (or such longer period, not to exceed 30 calendar days, as to
which each Rating Agency may consent) cause the Paying Agent to establish a new
Certificate Distribution Account as an Eligible Deposit Account and shall
transfer any cash and/or any investments from the account that is no longer an
Eligible Deposit Account to such new Certificate Distribution Account.
Section 5.02. Application of Trust Funds.
(a) On each Distribution Date, the Paying Agent shall distribute to
Certificateholders amounts deposited in the Certificate Distribution Account
pursuant to Sections 8.2(c)(i) and the second last sentence of Section 8.2(d)
of the Indenture with respect to such Distribution Date.
(b) On each Distribution Date, the Owner Trustee shall cause the
Paying Agent to send to each Certificateholder the statement or statements
provided to the Owner Trustee by the Indenture Trustee pursuant to Section 4.7
of the Sale and Servicing Agreement with respect to such Distribution Date.
(c) In the event that any withholding tax is imposed on the Trust's
payment (or allocations of income) to a Certificateholder, such tax shall
reduce the amount otherwise distributable to such Certificateholder in
accordance with this Section. The Owner Trustee and the Paying Agent are hereby
authorized and directed to retain from amounts otherwise distributable to the
Certificateholders sufficient funds for the payment of any tax that is legally
owed by the Trust (but such authorization shall not prevent the Owner Trustee
or the Paying Agent from contesting any such tax in appropriate proceedings and
withholding payment of such tax, if permitted by law, pending the outcome of
such proceedings). The amount of any
15
withholding tax imposed with respect to a Certificateholder shall be treated as
cash distributed to such Certificateholder at the time it is withheld by the
Owner Trustee on behalf of the Trust and remitted to the appropriate taxing
authority. If there is a possibility that withholding tax is payable with
respect to a distribution (such as a distribution to a non-U.S.
Certificateholder), the Owner Trustee or the Paying Agent may in its sole
discretion withhold such amounts in accordance with this paragraph. If a
Certificateholder wishes to apply for a refund of any such withholding tax, the
Owner Trustee and each Paying Agent shall reasonably cooperate with such
Certificateholder in making such claim so long as such Certificateholder agrees
to reimburse the Owner Trustee and each Paying Agent for any out of pocket
expenses incurred.
(d) Any Certificateholder which is organized under the laws of a
jurisdiction outside the United States shall, on or prior to the date such
Certificateholder becomes a Certificateholder, so notify the Owner Trustee and
the Paying Agent and either (i) provide the Owner Trustee and the Paying Agent
with Internal Revenue Service Form X-0XXX, X-0XXX, W-8IMY (including all
required attachments thereto) or other similar forms, as appropriate, or (ii)
notify the Owner Trustee and the Paying Agent that it is not entitled to an
exemption from United States withholding tax or a reduction in the rate thereof
on payments of interest. Any such Certificateholder agrees by its acceptance of
a Trust Certificate, on an ongoing basis, to provide like certification for
each taxable year and to notify the Owner Trustee and the Paying Agent should
subsequent circumstances arise affecting the information provided the Owner
Trustee in clauses (a) and (b) above. The Owner Trustee and the Paying Agent
shall be fully protected in relying upon, and each Certificateholder by its
acceptance of a Trust Certificate hereunder agrees to indemnify and hold the
Owner Trustee and the Paying Agent harmless against all claims or liability of
any kind arising in connection with or related to the Owner Trustee's and the
Paying Agent's reliance upon any documents, forms or information provided by
any Certificateholder to the Owner Trustee.
Section 5.03. Method of Payment. Subject to Section 9.01(c),
distributions required to be made to Certificateholders on any Distribution
Date shall be made to each Certificateholder of record on the preceding Record
Date either by wire transfer, in immediately available funds, to the account of
such Certificateholder at a bank or other entity having appropriate facilities
therefor, if such Certificateholder shall have provided to the Certificate
Registrar and the Paying Agent appropriate written instructions at least five
Business Days prior to such Distribution Date or, if not, by check mailed to
such Certificateholder at the address of such Certificateholder appearing in
the Certificate Register.
Section 5.04. No Segregation of Moneys; No Interest. Subject to
Sections 5.01 and 5.02, moneys received by the Owner Trustee hereunder need not
be segregated in any manner except to the extent required by law or the Sale
and Servicing Agreement, and may be deposited under such general conditions as
may be prescribed by law, and the Owner Trustee shall not be liable for any
interest thereon.
Section 5.05. Accounting and Reports to Certificateholders, the
Internal Revenue Service and Others. The Trust shall (a) maintain (or cause to
be maintained) the books of the Trust on a calendar year basis and the accrual
method of accounting, (b) deliver (or cause to delivered) to each
Certificateholder each Investor Report delivered to the Owner Trustee pursuant
to Section 3.8 of the Sale and Servicing Agreement, (c) deliver (or cause to
delivered)
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to each Certificateholder, as may be required by the Code and applicable
Treasury Regulations, such information as may be required (including providing
a Schedule K-1 to each partner if the Trust is required to be treated as a
partnership for federal income tax purposes) to enable each Certificateholder
to prepare its federal and state income tax returns, (d) prepare (or cause to
be prepared), file (or cause to be filed) such tax returns relating to the
Trust (including a partnership information return, IRS Form 1065 if the Trust
is required to be treated as a partnership for federal income tax purposes) and
make such elections as from time to time may be required or appropriate under
any applicable state or federal statute or any rule or regulation thereunder so
as to maintain the Trust's characterization, (e) cause such tax returns to be
signed in the manner required by law and (f) collect or cause to be collected
any withholding tax as described in and in accordance with Section 5.02(c) with
respect to income or distributions to Certificateholders. The Trust or the tax
matters partner shall elect under Section 1278 of the Code to include in income
currently any market discount that accrues with respect to the Receivables. The
Trust shall not make the election provided under Section 754 of the Code, if
applicable.
Section 5.06. Signature on Returns; Tax Matters Partner.
(a) The Owner Trustee shall sign, on behalf of the Trust, the tax
returns of the Trust, if any, unless applicable law requires a
Certificateholder to sign such documents.
(b) In the event that the Trust is required to be treated as a
partnership for federal income tax purposes, the Certificateholder holding a
majority of the Certificate Percentage Interest shall be designated the "tax
matters partner" of the Trust pursuant to Section 6231(a)(7)(A) of the Code.
ARTICLE VI
AUTHORITY AND DUTIES OF OWNER TRUSTEE
Section 6.01. General Authority. The Owner Trustee is authorized
and directed to execute and deliver the Basic Documents to which the Trust is
to be a party and each certificate or other document attached as an exhibit to
or contemplated by the Basic Documents to which the Trust is to be a party, in
each case as evidenced conclusively by the Owner Trustee's execution thereof.
In addition to the foregoing, the Owner Trustee is authorized to take all
actions required of the Trust pursuant to the Basic Documents. The Owner
Trustee is further authorized from time to time to take such action as the
Depositor or the Administrator directs with respect to and in accordance with
the Basic Documents (except to the extent that this Agreement expressly
requires the consent of Certificateholders for such action, in which case the
Owner Trustee shall not take such action without such consent).
Section 6.02. General Duties. It shall be the duty of the Owner
Trustee to discharge (or cause to be discharged) all of its responsibilities
pursuant to the terms of this Agreement and the Basic Documents to which the
Trust is a party and to administer the Trust in the interest of the
Certificateholders, subject to the Basic Documents and in accordance with the
provisions of this Agreement.
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Section 6.03. Action upon Instruction.
(a) Subject to Article IV and in accordance with the terms of the
Basic Documents, the Certificateholders may, by written instruction, direct the
Owner Trustee in the management of the Trust. Such direction may be exercised
at any time by written instruction of the Certificateholders pursuant to
Article IV.
(b) The Owner Trustee shall not be required to take any action
hereunder or under any Basic Document if the Owner Trustee shall have
reasonably determined, or shall have been advised by counsel, that such action
is likely to result in liability on the part of the Owner Trustee or is
contrary to the terms hereof or of any Basic Document or is otherwise contrary
to law.
(c) Whenever the Owner Trustee is unable to decide between
alternative courses of action permitted or required by the terms of this
Agreement or under any Basic Document, the Owner Trustee shall promptly give
notice (in such form as shall be appropriate under the circumstances) to the
Certificateholders of record as of the preceding Record Date requesting
instruction as to the course of action to be adopted, and to the extent the
Owner Trustee acts in good faith in accordance with any written instruction of
such Certificateholders received, the Owner Trustee shall not be liable on
account of such action to any Person. If the Owner Trustee shall not have
received appropriate instruction within ten (10) days of such notice (or within
such shorter period of time as reasonably may be specified in such notice or
may be necessary under the circumstances) it may, but shall be under no duty
to, take or refrain from taking such action not inconsistent with this
Agreement or the Basic Documents, as it shall deem to be in the best interests
of the Certificateholders, and shall have no liability to any Person for such
action or inaction.
(d) In the event that the Owner Trustee is unsure as to the
application of any provision of this Agreement or any Basic Document or any
such provision is ambiguous as to its application, or is, or appears to be, in
conflict with any other applicable provision, or in the event that this
Agreement permits any determination by the Owner Trustee or is silent or is
incomplete as to the course of action that the Owner Trustee is required to
take with respect to a particular set of facts, the Owner Trustee may give
notice (in such form as shall be appropriate under the circumstances) to the
Certificateholders of record as of the preceding Record Date requesting
instruction and, to the extent that the Owner Trustee acts in good faith in
accordance with any such instruction received or, if instructed not to act, in
good faith refrains from acting, the Owner Trustee shall not be liable, on
account of such action or inaction, to any Person. If the Owner Trustee shall
not have received appropriate instruction within ten days of such notice (or
within such shorter period of time as reasonably may be specified in such
notice or may be necessary under the circumstances) it may, but shall be under
no duty to, take or refrain from taking such action not inconsistent with this
Agreement or the other Basic Documents, as it shall deem to be in the best
interests of the Certificateholders, and shall have no liability to any Person
for such action or inaction.
Section 6.04. No Duties Except as Specified in this Agreement or in
Instructions. The Owner Trustee shall not have any duty or obligation to
manage, make any payment with respect to, register, record, sell, dispose of,
or otherwise deal with the Trust Estate, or to
18
otherwise take or refrain from taking any action under, or in connection with,
any document contemplated hereby to which the Owner Trustee or the Trust is a
party, except as expressly provided by the terms of this Agreement or in any
document or written instruction received by the Owner Trustee pursuant to
Section 6.03; and no implied duties or obligations shall be read into this
Agreement or any other Basic Document against the Owner Trustee. The Owner
Trustee shall have no responsibility for filing any financing or continuation
statement in any public office at any time or to otherwise perfect or maintain
the perfection of any security interest or Lien granted to it hereunder or to
prepare or file any Commission filing for the Trust or to record this Agreement
or any other Basic Document. The Owner Trustee nevertheless agrees that it
will, at its own cost and expense, promptly take all action as may be necessary
to discharge any Liens on any part of the Trust Property that result from
actions by, or claims against, the Owner Trustee in its individual capacity
that are not related to the ownership or the administration of the Trust
Property.
Section 6.05. No Action Except Under Specified Documents or
Instructions. The Owner Trustee shall not manage, control, use, sell, dispose
of or otherwise deal with any part of the Trust Property except (i) in
accordance with the powers granted to and the authority conferred upon the
Owner Trustee pursuant to this Agreement, (ii) in accordance with the Basic
Documents and (iii) in accordance with any document or instruction delivered to
the Owner Trustee pursuant to any provision of this Agreement.
Section 6.06. Restrictions. The Owner Trustee shall not take any
action (a) that is inconsistent with the purposes of the Trust set forth in
Section 2.03 or (b) that, to the actual knowledge of the Owner Trustee would
result in the Trust's becoming taxable as a corporation for federal income tax
purposes. The Certificateholders shall not direct the Owner Trustee to take
action that would violate the provisions of this Section.
Section 6.07. Administrative Duties.
(a) Subject to the restrictions contained in Article IV, the Owner
Trustee shall prepare or shall cause the preparation by other appropriate
Persons (and such preparation shall not be the responsibility of the Seller,
the Administrator, the Depositor, the Indenture Trustee or the Master Servicer)
of all such documents, reports, filings, instruments, certificates and opinions
as it shall be the duty of the Trust to prepare, file or deliver pursuant to
the Indenture with respect to the following matters under the Indenture
(parenthetical section references are to sections of the Indenture):
(i) (a) the appointment of a successor Note Registrar and (b)
giving the Indenture Trustee notice of any appointment of a new Note
Registrar and the location, or change in location, of the Note Registrar
(Section 2.5);
(ii) the delivery for cancellation of any Note delivered to
the Issuer for cancellation, and the direction to destroy or return such
Note (Section 2.9);
(iii) the preparation of Definitive Notes in accordance with
the instructions of the Clearing Agency (Section 2.13);
19
(iv) the designation of an office in the Borough of
Manhattan, City of New York, for registration of transfer or exchange of
Notes (Section 3.2);
(v) the preparation of an Issuer Order directing the Paying
Agent to deposit with the Securities Administrator all sums held in trust
by such Paying Agent (Section 3.3 and 4.3);
(vi) the preparation of an Issuer Order directing the
Securities Administrator to provide notification of any unclaimed monies
and repayments (Section 3.3);
(vii) the filing of all supplements and amendments to the
Indenture, instruments of further assurance and other instruments and the
taking of such other action as is necessary or advisable to protect the
Trust Estate, including the preparation and filing of any financing
statements and continuation statements (Section 3.5);
(viii) the annual delivery of Opinions of Counsel as to the
Trust Estate, and the and the annual delivery of the Officer's
Certificate and certain other statements as to compliance with the
Indenture (Sections 3.6 and 3.9);
(ix) the preparation and obtaining of documents and
instruments required for the release of the Issuer from its obligations
under the Indenture (Section 3.10(b));
(x) the execution of any further instruments and the
performance of any acts reasonably necessary to carry out more
effectively the purpose of the Indenture (Section 3.17);
(xi) upon its actual knowledge of such, the delivery to the
Indenture Trustee of written notice in the form of an Officer's
Certificate of any event that with the giving of notice and the lapse of
time would become an Event of Default under clause (iii) of Section 5.1
of the Indenture (Section 5.1);
(xii) the performance of any lawful action as the Controlling
Party may request to compel or secure the performance and observance by
the Seller of each of its obligations to the Issuer in the Basic
Documents (Section 5.16);
(xiii) the preparation of any written instruments required to
confirm more fully the authority of any co-trustee or separate trustee
and any written instructions necessary in connection with the resignation
or removal of any co-trustee or separate trustee (Sections 6.8 and 6.10);
(xiv) receiving and administering requests of Noteholders for
the current list of Noteholders (Section 7.2);
(xv) upon its actual knowledge of such, the notification to
the Indenture Trustee if and when the Notes are listed on any stock
exchange (Section 7.4);
20
(xvi) the delivery of new Notes conforming to any
supplemental indenture (Section 9.6);
(xvii) the duty to furnish to the Rating Agencies and the
Indenture Trustee notice of redemption of Notes, if the Master Servicer
has not previously done so (Section 10.1);
(xviii) the duty to notify Noteholders of redemption of the
Notes or to cause the Indenture Trustee to provide such notification
(Section 10.2);
(xix) the preparation and delivery of all Officer's
Certificates and Independent Certificates with respect to any requests by
the Issuer to the Indenture Trustee to take any action under the
Indenture (Section 11.1(a));
(xx) the preparation and delivery of all Officer's
Certificates and the obtaining of Independent Certificates, if necessary,
for the release of property from the lien of the Indenture (Section
11.1(b)); and
(xxi) the preparation and delivery to Noteholders and the
Indenture Trustee of any agreements or requests by the Noteholders with
respect to alternate payment and notice provisions (Section 11.6).
(b) The Owner Trustee shall receive as compensation for its
services hereunder such fees as have been separately agreed upon before the
date hereof among the Depositor and the Owner Trustee, and the Owner Trustee
shall be reimbursed for its other reasonable expenses hereunder in the priority
set forth in Section 8.2 in the Indenture. In performing its duties under
Section 5.05 or 6.07, the Owner Trustee shall be entitled to the
indemnification provided by the Issuer under Section 8.02 of this Agreement, in
the priority set forth in Section 8.2 of the Indenture.
(c) It is understood and agreed that the Owner Trustee shall be
entitled to engage outside counsel, independent accountants and other experts
to assist the Owner Trustee in connection with the performance of its duties
set forth in Sections 5.05 and 6.07, including the preparation of all tax
reports and returns, securities law filings, Opinions of Counsel and
Independent Certificates and the Owner Trustee shall be reimbursed for the
expenses of such experts in accordance with the priority set forth in Section
8.2 of the Indenture. The Owner Trustee shall not be obligated to engage any
expert or perform any duty as required under Sections 5.05 and 6.07 for which
reimbursement would exceed $1,000 until such amount has been paid to the Owner
Trustee, if payment of such reimbursable amount is required of the Owner
Trustee prior to the next Distribution Date.
(d) The Depositor and the Master Servicer shall furnish to the
Owner Trustee from time to time such additional information regarding the Trust
or the Basic Documents as the Owner Trustee shall reasonably request. The Note
Registrar will furnish or cause to be furnished to the Indenture Trustee and
the Owner Trustee at such times as the Indenture Trustee or the Owner Trustee
may request in writing, within thirty days after receipt by the Note Registrar
of any such request, a list, in such form as the Indenture Trustee or Owner
Trustee may reasonably require, of the names and addresses of the Holders of
Notes as of a date not more than ten days
21
prior to the time such list is furnished; provided, however, that so long as
the Indenture Trustee is the Note Registrar, no such list shall be required to
be furnished to the Indenture Trustee.
(e) The Owner Trustee shall not be responsible for taking any
action with respect to this Section 6.07 unless a responsible officer in the
Corporate Trust Administration Department of the Owner Trustee has actual
knowledge or has received written notice of the need to take such action.
(f) The rights and protections afforded to the Owner Trustee
pursuant to Article VII of this Agreement shall also be afforded to the Owner
Trustee with respect to the performance of its administrative duties under this
Section 6.07.
ARTICLE VII
CONCERNING THE OWNER TRUSTEE
Section 7.01. Acceptance of Trusts and Duties. The Owner Trustee
accepts the trusts hereby created and agrees to perform its duties hereunder
with respect to such trusts, but only upon the terms of this Agreement. The
Owner Trustee also agrees to disburse all moneys actually received by it
constituting part of the Trust Estate upon the terms of the Basic Documents and
this Agreement. The Owner Trustee, in its individual capacity, shall not be
answerable or accountable hereunder or under any Basic Document under any
circumstances, except (i) for its own willful misconduct or gross negligence or
(ii) in the case of the inaccuracy of any representation or warranty contained
in Section 7.03 expressly made by the Owner Trustee in its individual capacity.
In particular, but not by way of limitation (and subject to the exceptions set
forth in the preceding sentence):
(a) the Owner Trustee shall not be liable for any error of judgment
made by a Trust Officer of the Owner Trustee;
(b) the Owner Trustee shall not be liable with respect to any
action taken or omitted to be taken by it in accordance with the instructions
of the Depositor, the Administrator or any Certificateholder;
(c) no provision of this Agreement or any other Basic Document
shall require the Owner Trustee to expend or risk funds or otherwise incur any
financial liability in the performance of any of its rights or powers hereunder
or under any Basic Document if the Owner Trustee shall have reasonable grounds
for believing that repayment of such funds or adequate indemnity against such
risk or liability is not reasonably assured or provided to it;
(d) under no circumstances shall the Owner Trustee be liable for
indebtedness evidenced by or arising under any of the Basic Documents,
including the principal of and interest on the Notes;
(e) the Owner Trustee shall not be responsible for or in respect of
the validity or sufficiency of this Agreement or for the due execution hereof
by the Depositor or for the form, character, genuineness, sufficiency, value or
validity of any of the Trust Estate, or for or in respect of the validity or
sufficiency of the Basic Documents, other than the certificate of
22
authentication on the Trust Certificates, and the Owner Trustee, in its
individual capacity, shall in no event assume or incur any liability, duty or
obligation to any Noteholder or to any Certificateholder, other than as
expressly provided for herein or expressly agreed to in the other Basic
Documents;
(f) the Owner Trustee shall not be responsible for monitoring the
performance of, and shall not be liable for the default or misconduct of the
Depositor, the Master Servicer, the Indenture Trustee, the Administrator or any
other Person under any of the Basic Documents or otherwise, and the Owner
Trustee shall have no obligation or liability to perform the obligations of the
Trust under this Agreement or the Basic Documents that are required to be
performed by the Indenture Trustee under the Indenture or the Depositor or the
Master Servicer under the Sale and Servicing Agreement or the Administrator
under the Administration Agreement; and
(g) the Owner Trustee shall be under no obligation to exercise any
of the rights or powers vested in it by this Agreement, or to institute,
conduct or defend any litigation under this Agreement or otherwise or in
relation to this Agreement or any Basic Document, at the request, order or
direction of any of the Certificateholders, unless such Certificateholders have
offered to the Owner Trustee security, in its individual capacity, or indemnity
satisfactory to it against the costs, expenses and liabilities that may be
incurred by the Owner Trustee, in its individual capacity, therein or thereby.
The right of the Owner Trustee to perform any discretionary act enumerated in
this Agreement or in any Basic Document shall not be construed as a duty, and
the Owner Trustee shall not be answerable for other than its gross negligence
or willful misconduct in the performance of any such act.
Section 7.02. Furnishing of Documents. The Owner Trustee shall
furnish to the Certificateholders, promptly upon receipt of a written request
therefor, duplicates or copies of all reports, notices, requests, demands,
certificates, financial statements and any other instruments furnished to the
Owner Trustee under the Basic Documents.
Section 7.03. Representations and Warranties. The Owner Trustee, in
its individual capacity, hereby represents and warrants to the Depositor, for
the benefit of the Certificateholders, that:
(a) It is a national banking association duly organized and validly
existing in good standing under the laws of the United States. It has all
requisite corporate power and authority to execute, deliver and perform its
obligations under this Agreement.
(b) It has taken all corporate action necessary to authorize the
execution and delivery by it of this Agreement and the other Basic Documents,
and this Agreement and the other Basic Documents will be executed and delivered
by one of its officers who is duly authorized to execute and deliver this
Agreement and the other Basic Documents on its behalf.
(c) Neither the execution or the delivery by it of this Agreement,
nor the consummation by it of the transactions contemplated hereby, nor
compliance by it with any of the terms or provisions hereof will contravene any
federal or Delaware law, governmental rule or regulation governing the banking
or trust powers of the Owner Trustee or any judgment or order binding on it, or
constitute any default under its charter documents or bylaws or any indenture,
23
mortgage, contract, agreement or instrument to which it is a party or by which
any of its properties may be bound.
(d) It is a corporation satisfying the provisions of Section
3807(a) of the Statutory Trust Statute; it is a national banking association
duly organized and validly existing in good standing under the laws of the
United States; it is authorized to exercise corporate trust powers; having a
combined capital and surplus of at least $50,000,000 and subject to supervision
or examination by federal or state authorities; and it has (or has a parent
that has) time deposits that are rated at least "A-1" by Standard & Poor's and
"Prime-1" by Moody's or is otherwise acceptable to each Rating Agency.
Section 7.04. Reliance; Advice of Counsel.
(a) The Owner Trustee (either in its individual capacity or as
Owner Trustee) shall incur no liability to anyone in acting upon any signature,
instrument, notice, resolution, request, consent, order, certificate, report,
opinion, bond, or other document or paper believed by it to be genuine and
believed by it to be signed by the proper party or parties. The Owner Trustee
may accept a certified copy of a resolution of the board of directors or other
governing body of any corporate party as conclusive evidence that such
resolution has been duly adopted by such body and that the same is in full
force and effect. As to any fact or matter the method of determination of which
is not specifically prescribed herein, the Owner Trustee may for all purposes
hereof rely on a certificate, signed by the president or any vice president or
by the treasurer or other authorized officers of the relevant party, as to such
fact or matter, and such certificate shall constitute full protection to the
Owner Trustee for any action taken or omitted to be taken by it in good faith
in reliance thereon.
(b) In the exercise or administration of the trusts hereunder and
in the performance of its duties and obligations under this Agreement or the
Basic Documents, the Owner Trustee (i) may act directly or through its agents
or attorneys pursuant to agreements entered into with any of them, and the
Owner Trustee shall not be liable for the conduct or misconduct of such agents
or attorneys if such agents or attorneys shall have been selected by the Owner
Trustee with reasonable care, and (ii) may consult with counsel, accountants
and other skilled Persons to be selected with reasonable care and employed by
it. The Owner Trustee shall not be liable for anything done, suffered or
omitted reasonably and in good faith by it in accordance with the written
opinion or advice of any such counsel, accountants or other such Persons.
Section 7.05. Not Acting in Individual Capacity. Except as
expressly provided in this Article VII, in accepting the trusts hereby created,
[__________________] acts solely as Owner Trustee hereunder and not in its
individual capacity, and all Persons having any claim against the Owner Trustee
by reason of the transactions contemplated by this Agreement or any Basic
Document shall look only to the Trust Property for payment or satisfaction
thereof.
Section 7.06. Owner Trustee Not Liable for Trust Certificates or
for Receivables. The recitals contained herein and in the Trust Certificates
(other than the signature and countersignature of the Owner Trustee on the
Trust Certificates) shall be taken as the statements of the Depositor, and the
Owner Trustee assumes no responsibility for the correctness thereof.
24
Except as set forth in Section 7.03, the Owner Trustee makes no representations
as to the validity or sufficiency of this Agreement, of any Basic Document or
of the Trust Certificates (other than the signature and countersignature of the
Owner Trustee on the Trust Certificates) or the Notes, or of any Receivable or
related documents. The Owner Trustee shall at no time have any responsibility
or liability for or with respect to the legality, validity and enforceability
of any Receivable or the perfection and priority of any security interest
created by any Receivable in any Financed Vehicle or the maintenance of any
such perfection and priority, or for or with respect to the sufficiency of the
Trust Property or its ability to generate the payments to be distributed to
Certificateholders under this Agreement or the Noteholders under the Indenture,
including, without limitation: the existence, condition and ownership of any
Financed Vehicle; the existence and enforceability of any insurance thereon;
the existence and contents of any Receivable on any computer or other record
thereof; the validity of the assignment of any Receivable to the Trust or of
any intervening assignment; the completeness of any Receivable; the performance
or enforcement of any Receivable; the compliance by the Depositor or the Master
Servicer with any warranty or representation made under any Basic Document or
in any related document or the accuracy of any such warranty or representation,
or any action of the Indenture Trustee or the Master Servicer or any
sub-Servicer taken in the name of the Owner Trustee.
Section 7.07. Owner Trustee May Own Trust Certificates and Notes.
The Owner Trustee in its individual or any other capacity may become the owner
or pledgee of Trust Certificates or Notes and may deal with the Depositor, the
Indenture Trustee and the Master Servicer in banking transactions with the same
rights as it would have if it were not Owner Trustee.
Section 7.08. Doing Business in Other Jurisdictions.
Notwithstanding anything contained herein to the contrary, the Owner Trustee
shall not be required to take any action in any jurisdiction other than in the
States of Delaware, New York or [__________________] if the taking of such
action will (i) require the consent or approval or authorization or order of,
or the giving of notice to, or the registration with, or the taking of any
other action in required by, any state or other governmental authority or
agency of any jurisdiction other than the States of Delaware, New York or
[__________________]; (ii) result in any fee, tax or other governmental charge
under the laws of any jurisdiction or any political subdivisions thereof in
existence on the date hereof other than the States of Delaware, New York or
[__________________] becoming payable by the Owner Trustee; or (iii) subject to
the Owner Trustee to personal jurisdiction in any jurisdiction other than the
States of Delaware, New York or [__________________] for causes of action
arising from acts unrelated to the consummation of the transactions by the
Owner Trustee, as the case may be, contemplated hereby. The Owner Trustee shall
be entitled to obtain advice of counsel (which advice shall be an expense of
the Trust under Section 8.01) to determine whether any action required to be
taken pursuant to the Agreement results in the consequences described in
clauses (i), (ii) and (iii) of the preceding sentence. In the event that said
counsel advises the Owner Trustee that such action will result in such
consequences, the Owner Trustee will appoint an additional trustee pursuant to
Section 10.05 to proceed with such action.
Section 7.09. Paying Agent, Certificate Registrar and
Authenticating Agent. The rights and protections afforded to the Owner Trustee
pursuant to this Article VII and Sections
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8.02, 10.02, and 10.03 shall also be afforded to the Paying Agent,
authenticating agent and Certificate Registrar.
ARTICLE VIII
COMPENSATION OF OWNER TRUSTEE
Section 8.01. Owner Trustee's Fees and Expenses. The Owner Trustee
shall receive from the Depositor or the Trust as compensation for its services
hereunder such fees as have been separately agreed upon before the date hereof
between the Depositor and the Owner Trustee, and the Owner Trustee shall be
reimbursed by the Depositor or the Trust for its other reasonable expenses
hereunder, including the reasonable compensation, expenses and disbursements of
such agents, representatives, experts and counsel as the Owner Trustee may
employ in connection with the exercise and performance of its rights and its
duties hereunder, in the priority set forth in Section 8.2 in the Indenture.
Section 8.02. Indemnification. The Trust and the Depositor shall
jointly and severally indemnify the Owner Trustee and its successors, assigns,
agents and servants (collectively, the "Indemnified Parties") from and against,
any and all liabilities, obligations, losses, damages, taxes, claims, actions
and suits, and any and all reasonable costs, expenses and disbursements
(including reasonable legal fees and expenses) of any kind and nature
whatsoever (collectively, "Expenses") which may at any time be imposed on,
incurred by, or asserted against the Owner Trustee or any Indemnified Party in
any way relating to or arising out of this Agreement, the Basic Documents, the
Owner Trust Estate, the administration of the Owner Trust Estate or the action
or inaction of the Owner Trustee hereunder, except only that the Trust shall
not be liable for or required to indemnify an Indemnified Party from or against
Expenses arising or resulting from (i) the willful misconduct or gross
negligence of the Owner Trustee or (ii) the inaccuracy of a representation or
warranty made by the Owner Trustee in Section 7.03. The indemnities contained
in this Section shall survive the resignation or removal of the Owner Trustee
or the termination of this Agreement. In the event of any claim, action or
proceeding for which indemnity will be sought pursuant to this Section, the
Indemnified Party's choice of legal counsel shall be subject to the approval of
the Depositor, which approval shall not be unreasonably withheld.
Section 8.03. Payments to the Owner Trustee. Any amounts paid by
the Trust pursuant to this Article VIII shall be payable solely in the priority
set forth in Section 8.2 of the Indenture and shall be deemed not to be a part
of the Trust Estate immediately after such payment.
ARTICLE IX
TERMINATION OF TRUST AGREEMENT
Section 9.01. Termination of Trust Agreement.
(a) The Trust shall dissolve upon the earlier of (i) the payment in
full or other liquidation and discharge in accordance with the Sale and
Servicing Agreement of each
26
Receivable and (ii) the sale by the Trust of all of the Receivables in
accordance with the Indenture and the Sale and Servicing Agreement, including
pursuant an exercise of the option to purchase under Section 8.1 of the Sale
and Servicing Agreement, and in each case upon the final distribution of all
moneys or other property or proceeds of the Trust Estate in accordance with the
terms of the Indenture, Article VIII of the Sale and Servicing Agreement,
Section 5.02 of this Agreement and the Statutory Trust Statute. Any money or
other property held as part of the Owner Trust Estate following such
distribution shall be distributed to the Certificateholders pro rata. The
bankruptcy, liquidation, dissolution, death or incapacity of any
Certificateholder shall not (i) operate to dissolve or terminate this Agreement
or the Trust, (ii) entitle such Certificateholder's legal representatives or
heirs to claim an accounting or to take any action or proceeding in any court
for a partition or winding up of all or any part of the Trust or Trust Estate
or (iii) otherwise affect the rights, obligations and liabilities of the
parties hereto.
(b) This Agreement and the Trust are irrevocable. Except as
provided in Section 9.01(a) and in this Section 9.01(b), neither the Depositor
nor any Certificateholder shall be entitled to revoke or terminate the Trust or
this Agreement.
(c) Notice of any dissolution of the Trust, specifying the
Distribution Date upon which Certificateholders shall surrender their Trust
Certificates to the Paying Agent for payment of the final distribution and
cancellation, shall be given by the Owner Trustee by letter to
Certificateholders mailed within five Business Days of receipt of notice of
such termination from the Master Servicer given pursuant to Section 8.1 of the
Sale and Servicing Agreement, stating (i) the Distribution Date upon or with
respect to which final payment of the Trust Certificates shall be made upon
presentation and surrender of the Trust Certificates at the office of the
Paying Agent therein designated, (ii) the amount of any such final payment and
(iii) that the Record Date otherwise applicable to such Distribution Date is
not applicable, payments being made only upon presentation and surrender of the
Trust Certificates at the office of the Paying Agent therein specified. The
Owner Trustee shall give such notice to the Certificate Registrar (if other
than the Owner Trustee) and the Paying Agent at the time such notice is given
to Certificateholders. Upon presentation and surrender of the Trust
Certificates, the Paying Agent shall cause to be distributed to
Certificateholders amounts distributable on such Distribution Date pursuant to
Section 5.02.
In the event that all of the Certificateholders shall not surrender
their Trust Certificates for cancellation within six months after the date
specified in the above mentioned written notice, the Owner Trustee shall give a
second written notice to the remaining Certificateholders to surrender their
Trust Certificates for cancellation and receive the final distribution with
respect thereto. If within one year after the second notice all the Trust
Certificates shall not have been surrendered for cancellation, the Owner
Trustee may take appropriate steps, or may appoint an agent to take appropriate
steps, to contact the remaining Certificateholders concerning surrender of
their Trust Certificates, and the cost thereof shall be paid out of the funds
and other assets that shall remain subject to this Agreement. Any funds
remaining in the Trust after exhaustion of such remedies shall be distributed
by the Owner Trustee to the Depositor, subject to applicable escheat laws.
(d) Upon the winding up of the Trust in accordance with the
Statutory Trust Statute (including, without limitation, the reasonable
provision for payment of all obligations of
27
the Trust in accordance with Section 3808(e) of the Statutory Trust Statute),
the Owner Trustee shall cause the Certificate of Trust to be canceled by filing
a certificate of cancellation with the Secretary of State in accordance with
the provisions of Section 3810 of the Statutory Trust Statute and thereupon the
Trust and this Agreement (other than Article VIII) shall terminate.
ARTICLE X
SUCCESSOR OWNER TRUSTEES AND ADDITIONAL OWNER TRUSTEES
Section 10.01. Eligibility Requirements for Owner Trustee. The
Owner Trustee shall at all times be a corporation satisfying the provisions of
Section 3807(a) of the Statutory Trust Statute; authorized to exercise
corporate trust powers; having a combined capital and surplus of at least
$50,000,000 and subject to supervision or examination by federal or state
authorities; incorporated or chartered under the laws of the State of Delaware
or the federal laws of the United States; and having (or having a parent that
has) time deposits that are rated at least "Prime-1" by Moody's and at least
"A-1" by Standard & Poor's, or which is otherwise acceptable to each Rating
Agency. If such corporation shall publish reports of condition at least
annually pursuant to law or to the requirements of the aforesaid supervising or
examining authority, then for the purpose of this Section, the combined capital
and surplus of such corporation shall be deemed to be its combined capital and
surplus as set forth in its most recent report of condition so published. In
case at any time the Owner Trustee shall cease to be eligible in accordance
with the provisions of this Section, the Owner Trustee shall resign immediately
in the manner and with the effect specified in Section 10.02.
Section 10.02. Resignation or Removal of Owner Trustee. The Owner
Trustee may at any time resign and be discharged from the trusts hereby created
by giving written notice thereof to the Depositor, the Indenture Trustee and
the Rating Agencies. Upon receiving such notice of resignation, the Depositor
shall promptly appoint a successor Owner Trustee by written instrument, in
duplicate, one copy of which instrument shall be delivered to the resigning
Owner Trustee and one copy to the successor Owner Trustee. If no successor
Owner Trustee shall have been so appointed and have accepted appointment within
30 days after the giving of such notice of resignation, the resigning Owner
Trustee may petition any court of competent jurisdiction for the appointment of
a successor Owner Trustee, provided, however, that such right to appoint or to
petition for the appointment of any such successor shall in no event relieve
the resigning Owner Trustee from any obligations otherwise imposed on it under
the Basic Documents until such successor has in fact assumed such appointment.
If at any time the Owner Trustee shall cease to be eligible in
accordance with the provisions of Section 10.01 and shall fail to resign after
written request therefor by the Depositor, or if at any time the Owner Trustee
shall be legally unable to act, or shall be adjudged bankrupt or insolvent, or
a receiver of the Owner Trustee or of its property shall be appointed, or any
public officer shall take charge or control of the Owner Trustee or of its
property or affairs for the purpose of rehabilitation, conservation or
liquidation, then the Depositor may remove the Owner Trustee. If the Depositor
shall remove the Owner Trustee under the authority of the immediately preceding
sentence, the Depositor shall promptly appoint a successor Owner Trustee by
written instrument, in duplicate, one copy of which instrument shall be
delivered to
28
the outgoing Owner Trustee so removed and one copy to the successor Owner
Trustee, and shall pay all fees owed to the outgoing Owner Trustee.
Any resignation or removal of the Owner Trustee and appointment of
a successor Owner Trustee pursuant to any of the provisions of this Section
shall not become effective until acceptance of appointment by the successor
Owner Trustee pursuant to Section 10.03 and payment of all fees and expenses
owed to the outgoing Owner Trustee. The Depositor shall provide notice of such
resignation or removal of the Owner Trustee to each Rating Agency.
Section 10.03. Successor Owner Trustee. Any successor Owner Trustee
appointed pursuant to Section 10.01 or 10.02 shall execute, acknowledge and
deliver to the Depositor, the Indenture Trustee and to its predecessor Owner
Trustee an instrument accepting such appointment under this Agreement, and
thereupon the resignation or removal of the predecessor Owner Trustee shall
become effective, and such successor Owner Trustee, without any further act,
deed or conveyance, shall become fully vested with all the rights, powers,
duties and obligations of its predecessor under this Agreement, with like
effect as if originally named as Owner Trustee. The predecessor Owner Trustee
shall, upon payment of its fees and expenses, deliver to the successor Owner
Trustee all documents and statements and monies held by it under this
Agreement; and the Depositor and the predecessor Owner Trustee shall execute
and deliver such instruments and do such other things as may reasonably be
required for fully and certainly vesting and confirming in the successor Owner
Trustee all such rights, powers, duties and obligations.
No successor Owner Trustee shall accept appointment as provided in
this Section unless at the time of such acceptance such successor Owner Trustee
shall be eligible as a successor Owner Trustee pursuant to Section 10.01.
Upon acceptance of appointment by a successor Owner Trustee
pursuant to this Section, the Depositor shall mail notice thereof to all
Certificateholders, the Master Servicer, the Indenture Trustee, the Noteholders
and the Rating Agencies. If the Depositor shall fail to mail such notice within
ten days after acceptance of such appointment by the successor Owner Trustee,
the successor Owner Trustee shall cause such notice to be mailed at the expense
of the Trust.
Any successor Owner Trustee appointed pursuant to this Section
10.03 shall promptly file an amendment to the Certificate of Trust with the
Secretary of State identifying the name and principal place of business of such
successor Owner Trustee in the State of Delaware.
Section 10.04. Merger or Consolidation of Owner Trustee. Any Person
into which the Owner Trustee may be merged or converted or with which it may be
consolidated, or any Person resulting from any merger, conversion or
consolidation to which the Owner Trustee shall be a party, or any Person
succeeding to all or substantially all of the corporate trust business of the
Owner Trustee, shall be the successor of the Owner Trustee hereunder, without
the execution or filing of any instrument or any further act on the part of any
of the parties hereto, anything herein to the contrary notwithstanding;
provided, that such Person shall be eligible pursuant to Section 10.01; and
provided further, that the Owner Trustee shall mail notice of such
29
merger or consolidation to each Rating Agency; and provided, further, that such
successor Owner Trustee shall file an amendment to the Certificate of Trust as
described in Section 10.03.
Section 10.05. Appointment of Co-Trustee or Separate Trustee.
Notwithstanding any other provisions of this Agreement, at any time, for the
purpose of meeting any legal requirements of any jurisdiction in which any part
of the Trust Estate or any Financed Vehicle may at the time be located, the
Owner Trustee shall have the power and shall execute and deliver all
instruments to appoint one or more Persons approved by the Owner Trustee to act
as co-trustee, jointly with the Owner Trustee, or as separate trustee or
separate trustees, of all or any part of the Trust Estate, and to vest in such
Person, in such capacity, such title to the Trust Estate or any part thereof
and, subject to the other provisions of this Section, such powers, duties,
obligations, rights and trusts as the Owner Trustee may consider necessary or
desirable. No co-trustee or separate trustee under this Agreement shall be
required to meet the terms of eligibility as a successor Owner Trustee pursuant
to Section 10.01 and no notice of the appointment of any co-trustee or separate
trustee shall be required pursuant to Section 10.03.
Each separate trustee and co-trustee shall, to the extent permitted
by law, be appointed and act subject to the following provisions and
conditions:
(a) all rights, powers, duties and obligations conferred or imposed
upon the Owner Trustee shall be conferred upon and exercised or performed by
the Owner Trustee and such separate trustee or co-trustee jointly (it being
understood that such separate trustee or co-trustee is not authorized to act
separately without the Owner Trustee joining in such act), except to the extent
that under any law of any jurisdiction in which any particular act or acts are
to be performed, the Owner Trustee shall be incompetent or unqualified to
perform such act or acts, in which event such rights, powers, duties and
obligations (including the holding of title to the Trust Estate or any portion
thereof in any such jurisdiction) shall be exercised and performed singly by
such separate trustee or co-trustee, but solely at the direction of the Owner
Trustee;
(b) no trustee under this Agreement shall be personally liable by
reason of any act or omission of any other trustee under this Agreement; and
(c) the Owner Trustee may at any time accept the resignation of or
remove any separate trustee or co-trustee.
Any notice, request or other writing given to the Owner Trustee
shall be deemed to have been given to each of the then separate trustees and
co-trustees, as effectively as if given to each of them. Every instrument
appointing any separate trustee or co-trustee shall refer to this Agreement and
the conditions of this Article. Each separate trustee and co-trustee, upon its
acceptance of the trusts conferred, shall be vested with the estates or
property specified in its instrument of appointment, either jointly with the
Owner Trustee or separately, as may be provided therein, subject to all the
provisions of this Agreement, specifically including every provision of this
Agreement relating to the conduct of, affecting the liability of, or affording
protection to, the Owner Trustee. Each such instrument shall be filed with the
Owner Trustee.
Any separate trustee or co-trustee may at any time appoint the
Owner Trustee as its agent or attorney-in-fact with full power and authority,
to the extent not prohibited by law, to
30
do any lawful act under or in respect of this Agreement on its behalf and in
its name. If any separate trustee or co-trustee shall die, become incapable of
acting, resign or be removed, all of its estates, properties, rights, remedies
and trusts shall vest in and be exercised by the Owner Trustee, to the extent
permitted by law, without the appointment of a new or successor co-trustee or
separate trustee.
ARTICLE XI
MISCELLANEOUS
Section 11.01. Supplements and Amendments. This Agreement may be
amended by the Depositor and the Owner Trustee, with prior written notice to
each Rating Agency, without the consent of any of the Noteholders or the
Certificateholders, to cure any ambiguity, to correct or supplement any
provisions in this Agreement or for the purpose of adding any provisions to or
changing in any manner or eliminating any of the provisions in this Agreement
or of modifying in any manner the rights of the Noteholders or the
Certificateholders; provided, however, that such action shall not, as evidenced
by the satisfaction of the Rating Agency Condition with respect to such
amendment, adversely affect in any material respect the interests of any
Noteholder or Certificateholder.
This Agreement may also be amended from time to time by the
Depositor and the Owner Trustee, with prior written notice to each Rating
Agency, with the consent of the Holders of Notes evidencing not less than a
majority of the Outstanding Amount of the Notes and the consent of the Holders
of Certificates evidencing not less than a majority of the Certificate
Percentage Interests, for the purpose of adding any provisions to or changing
in any manner or eliminating any of the provisions of this Agreement or of
modifying in any manner the rights of the Noteholders or the
Certificateholders; provided, however, that no such amendment shall (a)
increase or reduce in any manner the amount of, or accelerate or delay the
timing of, collections of payments on Receivables or distributions that shall
be required to be made for the benefit of the Noteholders or the
Certificateholders or (b) reduce the aforesaid percentage of the Outstanding
Amount of the Notes and the aforesaid Certificate Percentage Interests required
to consent to any such amendment, without the consent of the Holders of all
then-outstanding Notes and the Certificateholders of all then-outstanding
Certificates.
Promptly after the execution of any such amendment or consent, the
Owner Trustee shall furnish written notification of the substance of such
amendment or consent to each Certificateholder, the Indenture Trustee and each
Rating Agency.
It shall not be necessary for the consent of Certificateholders or
Noteholders pursuant to this Section to approve the particular form of any
proposed amendment or consent, but it shall be sufficient if such consent shall
approve the substance thereof. The manner of obtaining such consents (and any
other consents of Certificateholders provided for in this Agreement or in any
other Basic Document) and of evidencing the authorization of the execution
thereof by Certificateholders or Noteholders shall be subject to such
reasonable requirements as the Owner Trustee may prescribe.
31
Promptly after the execution of any amendment to the Certificate of
Trust, the Owner Trustee shall cause the filing of such amendment with the
Secretary of State.
Prior to the execution of any amendment to this Agreement, any
other Basic Document or the Certificate of Trust, the Owner Trustee shall be
entitled to receive and rely upon an Opinion of Counsel stating that the
execution of such amendment is authorized or permitted by this Agreement and
that all conditions precedent (if any) to such amendment specified in this
Agreement and the other Basic Documents have been met. The Owner Trustee may,
but shall not be obligated to, enter into any such amendment that affects the
Owner Trustee's own rights, duties or immunities under this Agreement or
otherwise.
Section 11.02. No Legal Title to Trust Estate in
Certificateholders. Neither the Depositor nor the Certificateholders shall have
legal title to any part of the Trust Estate. The Certificateholders shall be
entitled to receive distributions with respect to their undivided ownership
interest therein only in accordance with Articles V and IX. No transfer, by
operation of law or otherwise, of any right, title or interest of the
Certificateholders to and in their undivided ownership interest in the Owner
Trust Estate shall operate to terminate this Agreement or the trusts hereunder
or entitle any transferee to an accounting or to the transfer to it of legal
title to any part of the Owner Trust Estate.
Section 11.03. Limitations on Rights of Others. The provisions of
this Agreement are solely for the benefit of the Owner Trustee, the Depositor,
the Certificateholders, the Paying Agent, the Certificate Registrar and, to the
extent expressly provided herein, the Indenture Trustee and the Noteholders,
and nothing in this Agreement, whether express or implied, shall be construed
to give to any other Person any legal or equitable right, remedy or claim in
the Owner Trust Estate or under or in respect of this Agreement or any
covenants, conditions or provisions contained herein.
Section 11.04. Notices.
(a) Unless otherwise expressly specified or permitted by the terms
hereof, all notices shall be in writing and shall be deemed given upon receipt
by the intended recipient or three Business Days after mailing if mailed by
first-class mail, postage prepaid (except that notice to the Owner Trustee
shall be deemed given only upon actual receipt by the Owner Trustee), if to the
Owner Trustee, addressed to the Corporate Trust Office; if to the Depositor,
addressed to ML Asset Backed Corporation, 4 World Financial Center, 00xx Xxxxx,
Xxx Xxxx, Xxx Xxxx 00000-0000, facsimile (000) 000-0000, Attention: Xxx Xxxxx;
if to Issuer, addressed to [_____________] Trust 200[_]-[_] c/o ML Asset Backed
Corporation, 4 World Financial Center, 00xx Xxxxx, Xxx Xxxx, Xxx Xxxx
00000-0000, facsimile (000) 000-0000, Attention: Xxx Xxxxx; or, as to each
party, at such other address as shall be designated by such party in a written
notice to each other party. A copy of any such notice shall also be mailed to
the Master Servicer, addressed to [__________________],[__________________],
facsimile [______________], Attention: [__________________].
(b) Any notice required or permitted to be given to a
Certificateholder shall be given by first-class mail, postage prepaid, at the
address of such Certificateholder as shown in the Certificate Register. Any
notice so mailed within the time prescribed in this Agreement shall
32
be conclusively presumed to have been duly given, whether or not such
Certificateholder receives such notice.
Section 11.05. Severability. Any provision of this Agreement or the
Trust Certificates that is prohibited or unenforceable in any jurisdiction
shall, as to such jurisdiction, be ineffective to the extent of such
prohibition or unenforceability without invalidating the remaining provisions
hereof or of the Trust Certificates, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.
Section 11.06. Separate Counterparts. This Agreement may be
executed by the parties hereto in separate counterparts, each of which when so
executed and delivered shall be an original, but all such counterparts shall
together constitute but one and the same instrument.
Section 11.07. Successors and Assigns. All covenants and agreements
contained herein shall be binding upon, and inure to the benefit of, each of
the Depositor and its permitted assignees, the Owner Trustee and its successors
and each Certificateholder and its successors and permitted assigns, all as
herein provided. Any request, notice, direction, consent, waiver or other
instrument or action by a Certificateholder shall bind the successors and
assigns of such Certificateholder.
Section 11.08. Covenants of the Depositor. The Depositor will not
at any time institute against the Trust any bankruptcy proceedings under any
United States federal or state bankruptcy or similar law in connection with any
obligations relating to the Trust Certificates, the Notes, this Agreement or
any of the other Basic Documents.
Section 11.09. No Petition. The Owner Trustee, by entering into
this Agreement, each Certificateholder, by accepting a Trust Certificate, and
the Indenture Trustee and each Noteholder, by accepting the benefits of this
Agreement, hereby covenant and agree that they will not at any time institute
against the Depositor or the Trust or join in any institution against the
Depositor or the Trust of, any bankruptcy proceedings under any United States
federal or state bankruptcy or similar law in connection with any obligations
relating to the Trust Certificates, the Notes, this Agreement or any of the
other Basic Documents.
Section 11.10. No Recourse. Each Certificateholder by accepting a
Trust Certificate acknowledges that such Trust Certificate represents a
beneficial interest in the Trust only and does not represent an interest in or
an obligation of the Depositor, the Master Servicer, the Owner Trustee, the
Indenture Trustee or any Affiliate thereof and no recourse may be had against
such parties or their assets, except as may be expressly set forth or
contemplated in this Agreement, the Trust Certificates or the Basic Documents.
Section 11.11. Headings. The headings of the various Articles and
Sections herein are for convenience of reference only and shall not define or
limit any of the terms or provisions hereof.
Section 11.12. GOVERNING LAW. THIS AGREEMENT SHALL BE CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF DELAWARE, WITHOUT REFERENCE TO ITS
CONFLICT OF LAW PROVISIONS, AND THE
33
OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED
IN ACCORDANCE WITH SUCH LAWS.
Section 11.13. Acceptance of Terms of Agreement. The receipt and
acceptance of a Trust Certificate by a Certificateholder, without any signature
or further manifestation of assent, shall constitute the unconditional
acceptance by the Certificateholder of all the terms and provisions of this
Agreement, and shall constitute the agreement of the Certificateholder that the
terms and provisions of this Agreement shall be binding, operative and
effective as between the Owner Trustee and the Certificateholder.
34
IN WITNESS WHEREOF, the parties hereto have caused this Trust
Agreement to be duly executed by their respective officers hereunto duly
authorized, as of the day and year first above written.
ML ASSET BACKED CORPORATION,
as Depositor
By:
---------------------------------------
Name:
Title:
[ ],
as Owner Trustee
By:
---------------------------------------
Name:
Title:
35
EXHIBIT A
---------
FORM OF TRUST CERTIFICATE
-------------------------
THIS TRUST CERTIFICATE IS SUBORDINATE TO THE NOTES, AS SET FORTH IN
THE SALE AND SERVICING AGREEMENT.
THIS TRUST CERTIFICATE HAS NOT BEEN AND WILL NOT BE REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR ANY
STATE SECURITIES LAWS, AND MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE
TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN EXEMPTION THEREFROM. IN
ADDITION, THE TRANSFER OF THIS TRUST CERTIFICATE IS SUBJECT TO CERTAIN
RESTRICTIONS AND CONDITIONS SET FORTH IN SECTION 3.04 OF THE TRUST AGREEMENT
UNDER WHICH THIS TRUST CERTIFICATE IS ISSUED (A COPY OF WHICH TRUST AGREEMENT
IS AVAILABLE FROM THE OWNER TRUSTEE OR UPON REQUEST), INCLUDING RECEIPT BY THE
OWNER TRUSTEE OF AN INVESTMENT LETTER IN WHICH THE TRANSFEREE MAKES CERTAIN
REPRESENTATIONS.
THE HOLDER OF THIS TRUST CERTIFICATE ACKNOWLEDGES AND AGREES THAT
ITS RIGHTS TO RECEIVE DISTRIBUTIONS ARE SUBORDINATED TO THE RIGHTS OF THE
NOTEHOLDERS AS DESCRIBED IN THE SALE AND SERVICING AGREEMENT, THE INDENTURE AND
THE TRUST AGREEMENT REFERRED TO HEREIN.
THIS TRUST CERTIFICATE IS NOT GUARANTEED OR INSURED BY THE FEDERAL
DEPOSIT INSURANCE CORPORATION OR ANY GOVERNMENTAL AGENCY.
A-1
NUMBER R-___ PERCENTAGE INTEREST: [ ]%
[__________________] TRUST 200[_]-[_] CERTIFICATE evidencing a
fractional undivided beneficial interest in the Trust, as defined below. The
property of the Trust includes a pool of motor vehicle installment sale
contracts and loans, secured by security interests in new and used automobiles,
light duty trucks, sports utility vehicles and motorcycles, conveyed by ML
Asset Backed Corporation.
THIS TRUST CERTIFICATE DOES NOT REPRESENT AN INTEREST IN OR AN
OBLIGATION OF [__________________], ML ASSET BACKED CORPORATION OR ANY OF THEIR
RESPECTIVE AFFILIATES.
THIS CERTIFIES THAT ________________ is the registered owner of a
____% PERCENT nonassessable, fully paid, undivided beneficial interest in
[______________] TRUST 200[_]-[_], a Delaware statutory trust (the "Trust"),
formed by ML ASSET BACKED CORPORATION, a Delaware corporation (the
"Depositor").
The Trust was created pursuant to a Trust Agreement dated as of
[___________], [____] (as amended, supplemented or otherwise modified from time
to time, the "Trust Agreement"), between the Depositor and
[__________________], as owner trustee (the "Owner Trustee"), a summary of
certain of the pertinent provisions of which is set forth below. To the extent
not otherwise defined herein, the capitalized terms used herein have the
meanings assigned to them in the Trust Agreement or the Sale and Servicing
Agreement dated as of [_________], [____] (as amended, supplemented or
otherwise modified from time to time, the "Sale and Servicing Agreement"),
among the Trust, the Depositor and [__________________], as Seller,
[__________________], as Master Servicer.
This Trust Certificate is one of the duly authorized Trust
Certificates designated as "Asset Backed Certificates" (herein called the
"Trust Certificates"). Also issued under an Indenture dated as of May 31,
200[_] (as amended, supplemented or otherwise modified from time to time, the
"Indenture"), among the Trust, [________________], as indenture trustee (the
"Indenture Trustee") and [________________], as securities administrator (the
"Securities Administrator"), are the classes of Notes designated
"[_________________]," "[__________________]," the "Notes"). This Trust
Certificate is issued under and is subject to the terms, provisions and
conditions of the Trust Agreement, to which Trust Agreement the Holder of this
Trust Certificate by virtue of its acceptance hereof assents and by which such
Certificateholder is bound. The property of the Trust consists of the Owner
Trust Estate. The rights of the Certificateholders are subordinate to the
rights of the Noteholders, as set forth in the Indenture.
Under the Trust Agreement, there will be distributed on the [___]th
day of each month or, if such [___]th day is not a Business Day, the next
Business Day (each, a "Distribution Date"), commencing on [______], [___], to
the Person in whose name this Trust Certificate is registered on the last day
of the immediately preceding month (the "Record Date"), such
Certificateholder's fractional undivided interest in the amount to be
distributed to Certificateholders on such Distribution Date.
A-2
The Holder of this Trust Certificate acknowledges and agrees that
its rights to receive distributions in respect of this Trust Certificate are
subordinate to the rights of the Noteholders as described in the Sale and
Servicing Agreement and the Indenture.
It is the intent of the Depositor and the Certificateholders that,
solely for income and franchise tax purposes the Trust shall be treated as a
grantor trust (or to the extent required, as a partnership) for income and
franchise tax purposes. A Certificateholder, by its acceptance of a Trust
Certificate, agrees to treat, and to take no action inconsistent with such
treatment of the Trust.
A Certificateholder, by its acceptance of a Trust Certificate,
covenants and agrees that such Certificateholder will not at any time institute
against the Depositor, the Owner Trustee or the Trust, or join in any
institution against the Depositor, the Owner Trustee or the Trust of, any
bankruptcy, reorganization, arrangement, insolvency or liquidation proceedings,
or other proceedings under any United States federal or state bankruptcy or
similar law in connection with any obligations relating to the Trust
Certificates, the Notes, the Trust Agreement or any of the other Basic
Documents.
Distributions on this Trust Certificate will be made as provided in
the Trust Agreement by the Owner Trustee or the Paying Agent by wire transfer
or check mailed to the Certificateholder of record in the Certificate Register
without the presentation or surrender of this Trust Certificate or the making
of any notation hereon.
Except as otherwise provided in the Trust Agreement and
notwithstanding the above, the final distribution on this Trust Certificate
will be made after due notice by the Owner Trustee of the pendency of such
distribution and only upon presentation and surrender of this Trust Certificate
at the office or agency designated for that purpose by the Owner Trustee as set
forth in the Trust Agreement.
Reference is hereby made to the further provisions of this Trust
Certificate set forth on the reverse hereof, which further provisions shall for
all purposes have the same effect as if set forth at this place.
Unless the certificate of authentication hereon shall have been
executed by an authorized officer of the Owner Trustee or the authenticating
agent, by manual signature, this Trust Certificate shall not entitle the Holder
hereof to any benefit under the Trust Agreement or the Sale and Servicing
Agreement or be valid for any purpose.
THIS TRUST CERTIFICATE SHALL BE CONSTRUED IN ACCORDANCE WITH THE
LAWS OF THE STATE OF DELAWARE, WITHOUT REFERENCE TO ITS CONFLICT OF LAW
PROVISIONS, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER
SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
A-3
IN WITNESS WHEREOF, the Owner Trustee has caused this Trust
Certificate to be duly executed.
[------------------],
not in its individual capacity but solely
as Owner Trustee
Dated: [__________], [____] By:
---------------------------------------
Authorized Signatory
A-4
OWNER TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Trust Certificates referred to in the
within-mentioned Trust Agreement.
[__________________], as Owner Trustee [__________________], as Owner Trustee
By: _____________________________
as Authenticating Agent
By: By:
------------------------------------
Authorizing Agent Authorizing Agent
A-5
[REVERSE OF TRUST CERTIFICATE]
The Trust Certificates do not represent an obligation of, or an
interest in, the Depositor, the Master Servicer, the Owner Trustee in its
individual capacity or any affiliates of any of them and no recourse may be had
against such parties or their assets, except as expressly set forth or
contemplated herein or in the Trust Agreement or the other Basic Documents. In
addition, this Trust Certificate is not guaranteed by any governmental agency
or instrumentality and is limited in right of payment to certain collections
and recoveries with respect to the Receivables (and certain other amounts), all
as more specifically set forth in the Trust Agreement and in the Sale and
Servicing Agreement. A copy of each of the Sale and Servicing Agreement and the
Trust Agreement may be examined by any Certificateholder upon written request
during normal business hours at the principal office of the Depositor and at
such other places, if any, designated by the Depositor.
The Trust Agreement permits, with certain exceptions provided
therein, the amendment thereof and the modification of the rights and
obligations of the Depositor and the rights of the Certificateholders under the
Trust Agreement at any time by the Depositor and the Owner Trustee, with prior
written notice to each Rating Agency, with the consent of the Holders of Notes
evidencing not less than a majority of the Outstanding Amount of the Notes and
the consent of the Certificateholders evidencing not less than a majority of
the Certificate Percentage Interests in the Trust Certificates, for the purpose
of adding any provisions to or changing in any manner or eliminating any of the
provisions of the Trust Agreement or of modifying in any manner the rights of
the Noteholders or the Certificateholders. Any such consent by the Holder of
this Trust Certificate shall be conclusive and binding on such Holder and on
all future Holders of this Trust Certificate and of any Trust Certificate
issued upon the transfer hereof or in exchange herefor or in lieu hereof,
whether or not notation of such consent is made upon this Trust Certificate.
The Trust Agreement also permits the amendment thereof, in certain limited
circumstances, without the consent of the Holders of any of the Trust
Certificates.
As provided in the Trust Agreement and subject to certain
limitations therein set forth, the transfer of this Trust Certificate is
registerable in the Certificate Register upon surrender of this Trust
Certificate for registration of transfer at the offices or agencies of the
Certificate Registrar designated by the Owner Trustee as set forth in the Trust
Agreement, accompanied by a written instrument of transfer in form satisfactory
to the Owner Trustee and the Certificate Registrar duly executed by the Holder
hereof or such Holder's attorney duly authorized in writing, and thereupon one
or more new Trust Certificates of authorized denominations evidencing the same
aggregate interest in the Trust will be issued to the designated transferee.
The initial Certificate Registrar appointed under the Trust Agreement is the
Owner Trustee.
Except as provided in the Trust Agreement, the Trust Certificates
are issuable only as registered Trust Certificates without coupons in minimum
denominations of one percent Certificate Percentage Interest. As provided in
the Trust Agreement and subject to certain limitations therein set forth, Trust
Certificates are exchangeable for new Trust Certificates of authorized
denominations evidencing the same aggregate denomination, as requested by the
Certificateholder surrendering the same. No service charge will be made for any
such registration of transfer or exchange, but the Owner Trustee or the
Certificate Registrar may
A-6
require payment of a sum sufficient to cover any tax or governmental charge
payable in connection therewith.
The Owner Trustee, the Certificate Registrar and any agent of the
Owner Trustee or the Certificate Registrar may treat the Person in whose name
this Trust Certificate is registered as the owner hereof for all purposes, and
none of the Owner Trustee, the Certificate Registrar or any such agent shall be
affected by any notice to the contrary.
The obligations and responsibilities created by the Trust Agreement
and the Trust created thereby shall terminate upon the payment to
Certificateholders of all amounts required to be paid to them pursuant to the
Trust Agreement and the Sale and Servicing Agreement and the disposition of all
property held as part of the Trust Estate. The Master Servicer, under certain
circumstances with the prior consent of the Certificateholders, may at its
option purchase the Trust Estate at a price specified in the Sale and Servicing
Agreement, and such purchase of the Receivables and other property of the Trust
will effect early retirement of the Trust Certificates; provided, however, that
such right of purchase is exercisable only as of the Determination Date as of
which the aggregate Principal Balance of the Receivables is less than or equal
to 10% of the Original Pool Balance.
The Trust Certificates may not be acquired by (a) an employee
benefit plan (as defined in Section 3(3) of ERISA) that is subject to the
provisions of Title I of ERISA or Similar Law, (b) a plan described in Section
4975(e)(1) of the Code that is subject to Section 4975 of the Code or Similar
Law, (c) any entity whose underlying assets include plan assets by reason of a
plan's investment in the entity (each, a "Benefit Plan") or (d) a Person
investing "plan assets" of an entity of any Person described in clauses (a)
through (c). By accepting and holding this Trust Certificate, the Holder hereof
shall be deemed to have represented and warranted that it is not a Benefit
Plan.
A-7
ASSIGNMENT
FOR VALUE RECEIVED the undersigned hereby sells, assigns and
transfers unto
PLEASE INSERT SOCIAL SECURITY OR
OTHER IDENTIFYING NUMBER OF ASSIGNEE
_______________________________________________________________________________
(Please print or type name and address, including postal zip code, of assignee)
the within Trust Certificate, and all rights thereunder, and hereby irrevocably
constitutes and appoints ____________, attorney, to transfer said Trust
Certificate on the books of the Certificate Registrar, with full power of
substitution in the premises.
Dated:
------------------------------------*/
Signature Guaranteed:
------------------------------------*/
--------------------------
*/ NOTICE: The signature to this assignment must correspond with the name
of the registered owner as it appears on the face of the within Trust
Certificate in every particular, without alteration, enlargement or any
change whatever. Such signature must be guaranteed by an "eligible
guarantor institution" meeting the requirements of the Certificate
Registrar, which requirements include membership or participation in
STAMP or such other "signature guarantee program" as may be determined
by the Certificate Registrar in addition to, or in substitution for,
STAMP, all in accordance with the Securities Exchange Act of 1934, as
amended.
A-8
EXHIBIT B
FORM OF TRANSFEROR CERTIFICATE
[DATE]
[------------------],
as Owner Trustee
[------------------]
Xxxxxxxxxx, Xxxxxxxx 00000
Attention: [__________________]
[------------------]
as Indenture Trustee
[------------------]
New York, New York [____]
[___________] Trust [__________________] 200[_]-[_] c/o ML Asset Backed
Corporation Four World Financial Center Xxxxx Xxxxx - 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: [__________________]
Re: [__________________] Trust [__________________] 200[_]-[_]
Ladies and Gentlemen:
In connection with our disposition of the Asset Backed Certificates
(the "Trust Certificates") issued by the referenced trust (the "Trust") we
certify that (a) we understand that the Trust Certificates have not been
registered under the Securities Act of 1933, as amended (the "Securities Act"),
and are being transferred by us in a transaction that is exempt from the
registration requirements of the Securities Act and (b) we have not offered or
sold any Trust Certificates to, or solicited offers to buy any Trust
Certificates from, any person, or otherwise approached or negotiated with any
person with respect thereto, in a manner that would be deemed, or taken any
other action which would result in, a violation of Section 5 of the Securities
Act.
Very truly yours,
[NAME OF TRANSFEROR]
By:
---------------------------------
Authorized Officer
B-1
EXHIBIT C
FORM OF INVESTMENT LETTER
[DATE]
[__________________],
as Owner Trustee
[__________________]
[__________________]
[__________________]
Attention: [__________________]
[__________________]
as Indenture Trustee
[__________________]
Xxx Xxxx, Xxx Xxxx 00000
[___________] Trust [__________________] 200[_]-[_] c/o ML Asset Backed
Corporation Four World Financial Center Xxxxx Xxxxx - 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx [_______]
Attention: [__________________]
Re: [___________] Trust [__________________] 200[_]-[_], Trust
Certificates
Ladies and Gentlemen:
In connection with our acquisition of the above-referenced Trust
Certificates (the "Certificates") we certify that (a) we understand that the
Certificates are not being registered under the Securities Act of 1933, as
amended (the "Act"), or any state securities laws and are being transferred to
us in a transaction that is exempt from the registration requirements of the
Act and any such laws, (b) we are an institutional "accredited investor," as
defined in Rule 501(a)(1), (2), (3) or (7) in Regulation D under the Act or an
entity in which all of the equity owners are institutional "accredited
investors," as defined in Rule 501(a)(1), (2), (3) or (7) in Regulation D under
the Act, and have such knowledge and experience in financial and business
matters that we are capable of evaluating the merits and risks of investments
in the Certificates, (c) we have had the opportunity to ask questions of and
receive answers from the seller concerning the purchase of the Certificates and
all matters relating thereto or any additional information deemed necessary to
our decision to purchase the Certificates, (d) we are acquiring the
Certificates for investment for our own account and not with a view to any
distribution of such Certificates (but without prejudice to our right at all
times to sell or otherwise dispose of the Certificates in accordance with
clause (f) below), (e) we have not offered or sold any Certificates to, or
solicited offers to buy any Certificates from, any person, or otherwise
approached or negotiated with any person with respect thereto, or taken any
other action that would result in a violation of Section 5 of the Act or any
state securities laws and (f) we will not sell, transfer or otherwise dispose
of any Certificates unless (1) such sale, transfer or
C-1
other disposition is made pursuant to an effective registration statement under
the Act and in compliance with any relevant state securities laws or is exempt
from such registration requirements and (2) the purchaser or transferee of such
Certificate has executed and delivered to you a certificate to substantially
the same effect as this certificate and (3) the purchaser or transferee has
otherwise complied with any conditions for transfer set forth in the Trust
Agreement dated as of [__________], [____], between ML Asset Backed Corporation
and [__________________], as Owner Trustee.
Very truly yours,
[NAME OF TRANSFEREE]
By:
--------------------------------
Authorized Officer
C-2
EXHIBIT D
FORM OF RULE 144A LETTER
[DATE]
[__________________],
as Owner Trustee
[__________________]
[__________________]
[__________________]
Attention: [__________________]
[__________________]
as Indenture Trustee
[__________________]
New York, New York [______]
[___________] Trust [__________________] 200[_]-[_] c/o ML Asset Backed
Corporation Four World Financial Center Xxxxx Xxxxx - 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: [__________________]
Re: [_____________] Trust [________________] 200[_]-[_], Trust
Certificates
Ladies and Gentlemen:
In connection with our acquisition of the above-referenced Trust
Certificates (the "Certificates") we certify that (a) we understand that the
Certificates are not being registered under the Securities Act of 1933, as
amended (the "Act"), or any state securities laws and are being transferred to
us in a transaction that is exempt from the registration requirements of the
Act and any such laws, (b) we have such knowledge and experience in financial
and business matters that we are capable of evaluating the merits and risks of
investments in the Certificates, (c) we have had the opportunity to ask
questions of and receive answers from the seller concerning the purchase of the
Certificates and all matters relating thereto or any additional information
deemed necessary to our decision to purchase the Certificates, (d) we have not,
nor has anyone acting on our behalf, offered, transferred, pledged, sold or
otherwise disposed of the Certificates or any interest in the Certificates, or
solicited any offer to buy, transfer, pledge or otherwise dispose of the
Certificates or any interest in the Certificates from any person in any manner,
or made any general solicitation by means of general advertising or in any
other manner, or taken any other action that would constitute a distribution of
the Certificates under the Act or that would render the disposition of the
Certificates a violation of Section 5 of the Act or any state securities laws
or require registration pursuant thereto, and we will not act, or authorize any
person to act, in such manner with respect to the Certificates, and (e) we are
a "qualified institutional buyer" as that term is defined in Rule 144A under
the Act. We are aware that the
D-1
sale to us is being made in reliance on Rule 144A. We are acquiring the
Certificates for our own account or for resale pursuant to Rule 144A and
understand that such Certificates may be resold, pledged or transferred only to
a person reasonably believed to be a qualified institutional buyer that
purchases for its own account or for the account of a qualified institutional
buyer to whom notice is given that the resale, pledge or transfer is being made
in reliance on Rule 144A.
Very truly yours,
[NAME OF TRANSFEREE]
By:
-------------------------------
Authorized Officer
D-2
