Exhibit 10.15
--------------
EXECUTION COPY
--------------
================================================================================
TRUST AGREEMENT
between
MCG FINANCE III, LLC,
as the Trust Depositor
----------------------
and
WILMINGTON TRUST COMPANY,
as the Owner Trustee
--------------------
Dated as of December 1, 2001
================================================================================
MCG Commercial Loan Trust Notes, Series 2001-1
Class A, Class B and Class C Notes
TABLE OF CONTENTS
-----------------
Page
ARTICLE I DEFINITIONS......................................................................................... 1
Section 1.01 Definitions......................................................................... 1
-----------
Section 1.02 Other Terms......................................................................... 2
-----------
Section 1.03 Computation of Time Periods......................................................... 3
---------------------------
Section 1.04 Interpretation...................................................................... 3
--------------
Section 1.05 References.......................................................................... 4
----------
Section 1.06 Calculations........................................................................ 4
------------
ARTICLE II ORGANIZATION....................................................................................... 4
Section 2.01 Name................................................................................ 4
----
Section 2.02 Office.............................................................................. 4
------
Section 2.03 Purposes and Powers................................................................. 4
-------------------
Section 2.04 Appointment of Owner Trustee........................................................ 6
----------------------------
Section 2.05 Initial Capital Contribution of Trust Estate........................................ 6
--------------------------------------------
Section 2.06 Declaration of Trust................................................................ 6
--------------------
Section 2.07 Liability of the Certificateholders................................................. 6
-----------------------------------
Section 2.08 Title to Trust Property............................................................. 6
-----------------------
Section 2.09 Situs of Trust...................................................................... 7
--------------
Section 2.10 Representations and Warranties of the Trust Depositor............................... 7
-----------------------------------------------------
Section 2.11 Federal Income Tax Allocations...................................................... 8
------------------------------
Section 2.12 Covenant of Certificateholders...................................................... 8
------------------------------
ARTICLE III CERTIFICATES AND TRANSFER OF INTERESTS............................................................ 9
Section 3.01 Initial Ownership................................................................... 9
-----------------
Section 3.02 The Certificates.................................................................... 9
----------------
Section 3.03 Authentication of Certificates...................................................... 9
------------------------------
Section 3.04 Registration of Transfer and Exchange of Certificates............................... 10
-----------------------------------------------------
Section 3.05 Mutilated, Destroyed, Lost or Stolen Certificates................................... 10
-------------------------------------------------
Section 3.06 Persons Deemed Owners............................................................... 11
---------------------
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......................................................... 12
---------------------------
Section 3.10 Transfer Restrictions............................................................... 12
---------------------
ARTICLE IV ACTIONS BY OWNER TRUSTEE........................................................................... 14
Section 4.01 Prior Notice to and Consent by Certificateholders with Respect to Certain Matters... 14
---------------------------------------------------------------------------------
Section 4.02 [Reserved].......................................................................... 15
--------
Section 4.03 Action by Certificateholders with Respect to Bankruptcy............................. 15
-------------------------------------------------------
Section 4.04 Restrictions on Certificateholders' Power........................................... 16
-----------------------------------------
Section 4.05 Majority Control.................................................................... 16
----------------
ARTICLE V APPLICATION OF TRUST FUNDS; CERTAIN DUTIES.......................................................... 16
i
Section 5.01 Establishment of Trust Account...................................................... 16
------------------------------
Section 5.02 Application of Trust Funds.......................................................... 17
--------------------------
Section 5.03 Method of Payment................................................................... 17
-----------------
Section 5.04 No Segregation of Moneys; No Interest............................................... 17
-------------------------------------
Section 5.05 Accounting and Reports to the Certificateholders, the Internal Revenue Service
-------------------------------------------------------------------------------
and Others.......................................................................... 18
----------
Section 5.06 Signature on Returns; Tax Matters Partner........................................... 18
-----------------------------------------
ARTICLE VI AUTHORITY AND DUTIES OF OWNER TRUSTEE.............................................................. 19
Section 6.01 General Authority................................................................... 19
-----------------
Section 6.02 General Duties...................................................................... 19
--------------
Section 6.03 Action upon Instruction............................................................. 19
-----------------------
Section 6.04 No Duties Except as Specified in this Agreement or in Instructions.................. 20
------------------------------------------------------------------
Section 6.05 Restrictions........................................................................ 21
------------
ARTICLE VII CONCERNING THE OWNER TRUSTEE...................................................................... 21
Section 7.01 Acceptance of Trusts and Duties..................................................... 21
-------------------------------
Section 7.02 Furnishing of Documents............................................................. 22
-----------------------
Section 7.03 Representations and Warranties...................................................... 22
------------------------------
Section 7.04 Reliance; Advice of Counsel......................................................... 23
---------------------------
Section 7.05 Not Acting in Individual Capacity................................................... 24
---------------------------------
Section 7.06 Owner Trustee Not Liable for Certificates or Loans.................................. 24
--------------------------------------------------
Section 7.07 Owner Trustee May Own Certificates and Notes........................................ 25
--------------------------------------------
ARTICLE VIII COMPENSATION OF OWNER TRUSTEE.................................................................... 25
Section 8.01 Owner Trustee's Fees and Expenses................................................... 25
---------------------------------
Section 8.02 Indemnification..................................................................... 25
---------------
Section 8.03 Payments to the Owner Trustee....................................................... 26
-----------------------------
ARTICLE IX TERMINATION OF TRUST AGREEMENT..................................................................... 26
Section 9.01 Termination of Trust Agreement...................................................... 26
------------------------------
ARTICLE X SUCCESSOR OWNER TRUSTEES AND ADDITIONAL OWNER TRUSTEES............................................. 27
Section 10.01 Eligibility Requirements for Owner Trustee.......................................... 27
------------------------------------------
Section 10.02 Resignation or Removal of Owner Trustee............................................. 28
---------------------------------------
Section 10.03 Successor Owner Trustee............................................................. 28
-----------------------
Section 10.04 Merger or Consolidation of Owner Trustee............................................ 29
----------------------------------------
Section 10.05 Appointment of Co-Trustee or Separate Trustee....................................... 29
---------------------------------------------
ARTICLE XI MISCELLANEOUS...................................................................................... 31
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
------------
ii
Section 11.06 Separate Counterparts............................................................... 33
---------------------
Section 11.07 Successors and Assigns.............................................................. 33
----------------------
Section 11.08 No Petition......................................................................... 33
-----------
Section 11.09 No Recourse......................................................................... 34
-----------
Section 11.10 Headings............................................................................ 34
--------
Section 11.11 GOVERNING LAW....................................................................... 34
-------------
Section 11.12 Third Party Rights.................................................................. 34
------------------
EXHIBITS
--------
EXHIBIT A Form of Certificate
EXHIBIT B Form of Certificate of Trust
EXHIBIT C Form of Purchaser's Representation Letter
iii
THIS TRUST AGREEMENT (the "Trust Agreement" or this "Agreement"), dated as
--------------- ---------
of December 1, 2001, is between MCG FINANCE III, LLC, a Delaware limited
liability company, as trust depositor (the "Trust Depositor"), and WILMINGTON
---------------
TRUST COMPANY, a Delaware banking corporation (in its individual capacity,
together with its successors and assigns, the "Trust Company"), as owner trustee
-------------
(solely in such capacity, the "Owner Trustee").
-------------
R E C I T A L S
---------------
WHEREAS, the Trust Depositor desires to establish a trust to be known as
the MCG Commercial Loan Trust 2001-1;
WHEREAS, the Trust Depositor desires to appoint the Owner Trustee as the
trustee of the Trust; and
WHEREAS, the Owner Trustee is willing to serve as trustee of the Trust.
NOW, THEREFORE, based upon the above recitals, the mutual promises and
agreements contained herein, and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereto,
intending to be legally bound, hereby agree as follows:
ARTICLE I
DEFINITIONS
Section 1.01 Definitions.
-----------
For all purposes of this Trust Agreement, except as otherwise expressly
provided below or unless the context otherwise requires, capitalized terms used
but not otherwise defined herein shall have the meanings given to such terms in
the Sale and Servicing Agreement, dated as of December 1, 2001 (the "Sale and
--------
Servicing Agreement"), among MCG Commercial Loan Trust 2001-1, as the Trust, MCG
-------------------
Finance III, LLC, as the Trust Depositor, MCG Capital Corporation, as the
Originator and as the Servicer, and Xxxxx Fargo Bank Minnesota, National
Association, as the Indenture Trustee and as the Backup Servicer, which
capitalized terms are incorporated by reference herein. All other capitalized
terms used herein shall have the meanings specified herein or below.
"Bankruptcy Action" shall have the meaning given to such term in Section 4.03 of
----------------- ------------
this Agreement.
"Certificate Account" shall have the meaning given to such term in Section 5.01
------------------- ------------
of this Trust Agreement.
1
"Certificate Register" shall mean the Certificate Register established and
--------------------
maintained in accordance with this Trust Agreement.
"Certificate Registrar" shall mean, initially, the Indenture Trustee, and
---------------------
thereafter, any successor appointed pursuant to this Trust Agreement.
"Certificate of Trust" shall mean a certificate of trust duly executed in the
--------------------
form of Exhibit B attached hereto.
---------
"Corporate Trust Office" means in the case of Owner Trustee: Wilmington Trust
----------------------
Company, Xxx Xxxxxx Xxxxxx Xxxxx, Xxxxxxxxxx, Xxxxxxxx 00000, Attention:
Corporate Trust Administration and in the case of the Indenture
Trustee/Certificate Registrar: Xxxxx Fargo Bank Minnesota, National Association,
Sixth and Marquette Avenue, MAC N9311-161, Xxxxxxxxxxx, Xxxxxxxxx 00000,
Attention: Corporate Trust Services/Asset Backed Administration, or at such
other address as the Owner Trustee or the Indenture Trustee may designate from
time to time by notice to the Trust Depositor.
"Majority Certificateholders" means the Holder or Holder of Certificates
---------------------------
evidencing an aggregate Percentage Interest in excess of 50%.
"Paying Agent" shall have the meaning given to such term in Section 3.09 of this
------------ ------------
Trust Agreement.
"Percentage Interest" shall mean (i) with respect to a Certificate, the
-------------------
percentage set forth on the face thereof, and (ii) with respect to a Class C
Note, the fraction, expressed as a percentage, the numerator of which is the
original principal balance of such Class C Note and the denominator of which is
the aggregate original principal balance of all Class C Notes.
"Secretary of State" shall have the meaning given to such term in Section 2.02
------------------ ------------
of this Agreement.
"Trust Estate" shall mean all right, title and interest of the Trust in and to
------------
the Loan Assets and other property and rights assigned to the Trust pursuant to
the Sale and Servicing Agreement, all funds on deposit from time to time in the
Trust Accounts and all other property of the Trust from time to time, including
any rights of the Owner Trustee and the Trust pursuant to the Transaction
Documents.
Section 1.02 Other Terms.
-----------
All accounting terms used but not specifically defined herein shall be
construed in accordance with generally accepted accounting principles. The
symbol "$" shall mean the lawful currency of the United States of America. All
terms used in Article 9 of the UCC in the State of New York, and not
specifically defined herein, are used herein as defined in such Article 9.
2
Section 1.03 Computation of Time Periods.
---------------------------
Unless otherwise stated in this Agreement, in the computation of a period
of time from a specified date to a later specified date, the word "from" means
"from and including", the words "to" and "until" each mean "to but excluding",
and the word "within" means "from and excluding a specified date and to and
including a later specified date".
Section 1.04 Interpretation.
--------------
In this Agreement, unless a contrary intention appears:
(i) the singular number includes the plural number and vice versa;
(ii) reference to any Person includes such Person's successors and
assigns but, if applicable, only if such successors and assigns are
permitted by the Transaction Documents;
(iii) reference to any gender includes each other gender;
(iv) reference to day or days without further qualification means
calendar days;
(v) unless otherwise stated, reference to any time means New York, New
York time;
(vi) references to "writing" include printing, typing, lithography,
electronic or other means of reproducing words in a visible form;
(vii) reference to any agreement (including any Transaction Document),
document or instrument means such agreement, document or instrument as
amended, modified, supplemented, replaced, restated, waived or extended and
in effect from time to time in accordance with the terms thereof and, if
applicable, the terms of the other Transaction Documents, and reference to
any promissory note includes any promissory note that is an extension or
renewal thereof or a substitute or replacement therefor; and
(viii) reference to any Requirement of Law means such Requirement of
Law as amended, modified, codified, replaced or reenacted, in whole or in
part, and in effect from time to time, including rules and regulations
promulgated thereunder and reference to any Section or other provision of
any Requirement of Law means that provision of such Requirement of Law from
time to time in effect and constituting the substantive amendment,
modification, codification, replacement or reenactment of such Section or
other provision.
3
Section 1.05 References.
----------
All section references (including references to the Preamble), unless
--------
otherwise indicated, shall be to Sections (and the Preamble) in this Agreement.
--------
Section 1.06 Calculations.
------------
Except as otherwise provided herein, all interest rate and basis point
calculations hereunder will be made on the basis of a 360-day year and the
actual days elapsed in the relevant period and will be carried out to at least
three decimal places.
ARTICLE II
ORGANIZATION
Section 2.01 Name.
----
The Trust shall be known as the "MCG Commercial Loan Trust 2001-1," in
which name the Trust shall have power and authority and is hereby authorized and
empowered, without the need for further action on the part of the Trust, and the
Owner Trustee shall have power and authority, and is hereby authorized and
empowered, to 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 the State of Delaware as the
Owner Trustee may designate by written notice to the Certificateholders and the
Trust Depositor. The Trust shall constitute a business trust within the meaning
of Section 3801(a) of the Delaware Business Trust Act for which the Owner
Trustee has filed a Certificate of Trust with the Secretary of State of the
State of Delaware pursuant to Section 3810(a) of the Delaware Business Trust
Act. The execution and filing of the Certificate of Trust by the Owner Trustee
is hereby ratified, authorized, and approved. The Owner Trustee shall have power
and authority, and is hereby authorized and empowered, to execute and file with
the Secretary of State of the State of Delaware (the "Secretary of State") any
------------------
other certificate required or permitted under the Delaware Business Trust Act to
be filed with the Secretary of State. It is the intention of the parties hereto
that this Trust Agreement constitute the governing instrument of such business
trust.
Section 2.03 Purposes and Powers.
-------------------
The purpose of the Trust is, and the Trust shall have the power and
authority and is hereby authorized and empowered, without the need for further
action on the part of the Trust, and the Owner Trustee shall have power and
authority, and is hereby authorized and empowered,
4
in the name and on behalf of the Trust, to do or cause to be done all acts and
things necessary, appropriate or convenient to cause the Trust, to engage in the
following activities:
(a)to execute, authenticate, deliver, and issue from time to time the Notes
pursuant to the Indenture and the Certificates pursuant to this Trust Agreement
and, if applicable, a supplement hereto, and to sell the Notes and to transfer
the Certificates pursuant to such agreements and the other Transaction
Documents;
(b)with the proceeds of the sale of the Notes, to purchase the Loans, to
pay the organizational, start-up and transactional expenses of the Trust, to
fund the Reserve Fund Initial Balance and to pay the balance to the Trust
Depositor pursuant to the Sale and Servicing Agreement;
(c)to assign, grant, transfer, pledge, mortgage, convey and grant a
security interest in the Trust Estate pursuant to the Indenture and to hold,
manage, transfer and distribute to the Certificateholders pursuant to the terms
of this Trust Agreement and 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, execute, deliver and perform its obligations under the
Transaction Documents to which it is to be a party and the Purchase Agreement;
(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 Transaction Documents, to engage in such
other activities as may be required in connection with the conservation of the
Trust Estate and the making of distributions to the Certificateholders, the
Noteholders and others specified in the Transaction Documents.
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
Transaction Documents. Nothing contained herein shall be deemed to authorize the
Owner Trustee on behalf of the Trust to engage in any other business operations
or any activities other than those set forth in this Section 2.03. Specifically,
------------
the Owner Trustee shall have no authority on behalf of the Trust to engage in
any business operations, or acquire any assets other than those specifically
included in the Trust Estate, or otherwise vary the assets held by the Trust
other than as provided in the Transaction Documents. Similarly, the Owner
Trustee shall have no discretionary duties other than performing those
ministerial acts set forth above necessary to accomplish the purpose of this
Trust as set forth in this Section 2.03. Notwithstanding anything to the
------------
contrary contained herein, the Trust may hold the Notes prior to their sale by
the Placement Agent.
5
Section 2.04 Appointment of Owner Trustee.
----------------------------
The Trust Depositor hereby appoints the Owner Trustee as trustee of the
Trust effective as of the date hereof, to have all the rights, powers and duties
set forth herein, and the Owner Trustee hereby accepts such appointment.
Section 2.05 Initial Capital Contribution of Trust Estate.
--------------------------------------------
The Trust Depositor hereby sells, assigns, transfers, conveys and sets over
to the Owner Trustee, as of the date hereof, the sum of $10.00. The Owner
Trustee hereby acknowledges receipt from the Trust Depositor, as of the date
hereof, of the foregoing contribution, which shall constitute the initial Trust
Estate (prior to giving effect to the conveyances described in the Sale and
Servicing Agreement) and shall be deposited in the Certificate Account. The
Trust 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 Transaction Documents. It is the intention of the parties hereto that the
Trust constitutes a business trust under the Business Trust Statute and that
this Trust Agreement constitute the governing instrument of such business trust.
It is the intention of the parties hereto that, solely for federal income tax
purposes, the Trust shall be treated as a partnership for federal income tax
purposes. The parties agree that, unless otherwise required by appropriate tax
authorities, the Trust will file or cause to be filed annual or other necessary
returns, reports and other forms consistent with the characterization of the
Trust as a partnership for such tax purposes. Effective as of the date hereof,
the Owner Trustee shall have all rights, powers and authority set forth herein
and in the Business Trust Statute with respect to accomplishing the purposes of
the Trust.
Section 2.07 Liability of the Certificateholders.
-----------------------------------
No Certificateholder shall have any personal liability for any liability or
obligation of the Trust.
Section 2.08 Title to Trust Property.
-----------------------
Legal title to all of the Trust Estate shall be vested at all times in the
Trust as a separate legal entity except where Requirements of Law in any
jurisdiction requires title to any part of the Trust Estate to be vested in a
trustee or trustees, in which case title shall be deemed to be vested in the
Owner Trustee, a co-trustee and/or a separate trustee, as the case may be.
6
Section 2.09 Situs of Trust.
--------------
All bank accounts maintained by the Owner Trustee on behalf of the Trust
shall be located in the State of Delaware or the State of Minnesota or such
other state in which the Corporate Trust Office may be located. The Trust shall
not have any employees in any state other than Delaware; provided, however, that
-----------------
nothing herein shall restrict or prohibit the Owner Trustee from having
employees within or without the State of Delaware. Payments will be received by
the Trust only in Delaware or Minnesota or such other state in which the
Corporate Trust Office may be located, and payments will be made by the Trust
only from Delaware or Minnesota or such other state in which the Corporate Trust
Office may be located. The only office of the Trust will be at the Corporate
Trust Office in Delaware.
Section 2.10 Representations and Warranties of the Trust Depositor.
-----------------------------------------------------
The Trust Depositor hereby represents and warrants to the Owner Trustee
that:
(a)The Trust Depositor is duly organized and validly existing as a limited
liability company 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 Trust Depositor has the power and authority to execute and deliver
this Agreement and to carry out its terms. The Trust Depositor has full power
and authority to sell and assign the property to be sold and assigned to and
deposited with the Trust and the Trust Depositor has duly authorized such sale
and assignment and deposit to the Trust by all necessary limited liability
company action.
(c)The execution, delivery and performance of this Agreement have been duly
authorized by the Trust Depositor by all necessary limited liability company
action.
(d)This Agreement constitutes a legal, valid and binding obligation of the
Trust Depositor enforceable in accordance with its terms, subject to applicable
bankruptcy, insolvency, reorganization and similar laws relating to creditors'
rights generally and creditors of national banking associations and subject to
general principles of equity.
(e)The execution, delivery and performance of this Trust Agreement and the
other Transaction Documents to which it is a party by the Trust Depositor, and
the consummation of the transactions contemplated hereby and thereby, will not
violate any material Requirement of Law applicable to the Trust Depositor, or
constitute a material breach of any mortgage, indenture, contract or other
agreement to which the Trust Depositor is a party or by which the Trust
Depositor or any of the Trust Depositor's properties may be bound, or result in
the creation or imposition of any security interest, lien, charge, pledge,
preference, equity or encumbrance of any kind upon any of its properties
pursuant to the terms of any such mortgage, indenture, contract or other
agreement, other than as contemplated by the Transaction Documents.
7
(f)To the Trust Depositor's best knowledge, there are no proceedings or
investigations pending, or to the Trust Depositor's knowledge threatened, before
any court, regulatory body, administrative agency or other governmental
instrumentality having jurisdiction over the Trust Depositor or its properties:
(A) asserting the invalidity of this Trust Agreement, (B) seeking to prevent the
consummation of any of the transactions contemplated by this Trust Agreement or
(C) seeking any determination or ruling that might materially and adversely
affect the performance by the Trust Depositor of its obligations under, or the
validity or enforceability of, this Trust Agreement.
Section 2.11 Federal Income Tax Allocations.
------------------------------
Assuming that issue prices of the Class C Notes are equal to the Initial
Class C Principal Balance, net income of the Trust for any month as determined
for federal income tax purposes (and each item of income, gain, loss, credit and
deduction entering into the computation thereof) shall be allocated among the
Certificateholders and the Holders of the Class C Notes, respectively, pro rata
based upon their Percentage Interests as a Class. Income will be allocated first
to the Class C Notes up to the amount of their entitlement to interest
(including interest on amounts previously due but not yet distributed) and then
to the Certificates. Taxable losses of the Trust will be allocated to the Class
C Notes to the extent the Class C Notes are reasonably expected to bear the
economic burden of such losses.
It is the intent of the Trust Depositor, the Servicer, the Holders of the
Class C Notes and the Certificateholders that, for purposes of federal income
taxes, in the event that the Certificates and the Class C Notes are owned by
more than one holder, the Trust will be treated as a partnership, the partners
of which are the Certificateholders and the Holders of the Class C Notes and, in
the event that the Certificates and the Class C Notes are all owned by a single
holder, the Trust will be treated as a division of such holder. The
Certificateholders and the Holders of the Class C Notes, by acceptance of a
Certificate and a Class C Note, respectively, agree to treat the Certificates
and Class C Notes as equity and to take no action inconsistent with the
treatment of, the Trust and the Certificates and Class C Notes for such tax
purposes as just described.
Section 2.12 Covenant of Certificateholders.
------------------------------
Each Certificateholder agrees to be bound by the terms and conditions of
the Certificates and of this Trust Agreement, including any supplements or
amendments hereto, and to perform the obligations of a Certificateholder as set
forth therein or herein, in all respects as if it were a signatory hereto. This
undertaking is made for the benefit of the Trust Depositor, the Trust, the Owner
Trustee, the Trust Company, the Paying Agent and all other Certificateholders
present and future.
8
ARTICLE III
CERTIFICATES AND TRANSFER OF INTERESTS
Section 3.01 Initial Ownership.
-----------------
Upon the formation of the Trust by the contribution by the Trust Depositor
pursuant to Section 2.05 and until the issuance of the Certificates, the Trust
------------
Depositor shall be the sole beneficiary of the Trust.
Section 3.02 The Certificates.
----------------
(a)The Certificates shall be substantially in the form set forth in Exhibit
-------
A hereto, with such changes as may be specified in a supplement to this Trust
-
Agreement. Except as otherwise set forth in a supplement to this Trust
Agreement, the Certificates shall be issued from time to time in minimum
Percentage Interests of 10% and integral multiples of 1% in excess thereof;
provided, however, that one Certificate may be issued in a different
-------- -------
denomination. The Certificates shall be executed on behalf of the Trust by
manual or facsimile signature of an authorized officer of the Owner Trustee or
the Certificate Registrar. Certificates bearing the manual or facsimile
signatures of individuals who were, at the time when such signatures shall have
been affixed, authorized to sign on behalf of the Trust, shall be validly issued
and entitled to the benefit of this Trust Agreement, notwithstanding that such
individuals or any of them shall have ceased to be so authorized prior to the
authentication and delivery of such Certificates or did not hold such offices at
the date of authentication and delivery of such Certificates.
(b)A transferee of a Certificate shall become a Certificateholder and shall
be entitled to the rights and subject to the obligations of a Certificateholder
hereunder upon such transferee's acceptance of a Certificate duly registered in
such transferee's name pursuant to Section 3.04.
------------
Section 3.03 Authentication of Certificates.
------------------------------
Concurrently with the initial transfer of the Loans to the Trust pursuant
to the Sale and Servicing Agreement, the Trust shall issue the Certificates, in
an aggregate Percentage Interest equal to 100%, executed by the Owner Trustee or
the Certificate Registrar on behalf of the Trust, authenticated and delivered to
or upon the written order of the Trust Depositor, signed by its chairman of the
board, its president, any vice president, secretary or any assistant treasurer,
without further corporate action by the Trust Depositor, in authorized
denominations. No Certificate shall entitle its Holder to any benefit under this
Agreement or be valid for any purpose unless there shall appear on such
Certificate a certificate of authentication substantially in the form set forth
in Exhibit A, executed by the Owner Trustee or the Certificate Registrar, by
---------
manual signature; such authentication shall constitute conclusive evidence that
such Certificate has been duly and validly authorized, issued, authenticated and
delivered hereunder and, subject to the terms of this Agreement, fully paid and
non-assessable. All Certificates shall be dated the date of their
authentication.
9
Section 3.04 Registration of Transfer and Exchange of Certificates.
-----------------------------------------------------
(a)The Certificate Registrar shall keep or cause to be kept, at the office
or agency maintained pursuant to Section 3.08, a Certificate Register in which,
------------
subject to such reasonable regulations as it may prescribe, the Certificate
Registrar shall provide for the registration of Certificates and, subject to
Section 3.10 hereof, of transfers and exchanges of Certificates as herein
------------
provided. The Indenture Trustee shall be the initial Certificate Registrar.
Promptly upon written request therefor from the Owner Trustee, the Certificate
Registrar shall provide to the Owner Trustee in writing such information
regarding or contained in the Certificate Register as the Owner Trustee may
reasonably request. The Owner Trustee shall be entitled to rely (and shall be
fully protected in relying) on such information.
(b)Upon surrender for registration of transfer of any Certificate at the
office or agency maintained pursuant to Section 3.08, the Owner Trustee, or the
------------
Certificate Registrar on its behalf, shall execute, authenticate and deliver, in
the name of the designated transferee or transferees, one or more new
Certificates in authorized denominations of a like aggregate amount dated the
date of authentication by the Owner Trustee or any authenticating agent. At the
option of a Certificateholder, Certificates may be exchanged for other
Certificates of authorized denominations of a like aggregate amount upon
surrender of the Certificates to be exchanged at the office or agency maintained
pursuant to Section 3.08.
------------
(c)Every Certificate presented or surrendered for registration of transfer
or exchange shall be accompanied by a written instrument of transfer in form
satisfactory to the Owner Trustee and the Certificate Registrar duly executed by
the registered Certificateholder or such registered Certificateholder's attorney
duly authorized in writing. Each Certificate surrendered for registration of
transfer or exchange shall be cancelled and subsequently disposed of by the
Owner Trustee in accordance with its customary practice.
(d)No service charge shall be made for any registration of transfer or
exchange of Certificates, but the Owner Trustee or the Certificate Registrar may
require payment of a sum sufficient to cover any tax or governmental charge that
may be imposed in connection with any transfer or exchange of Certificates.
Section 3.05 Mutilated, Destroyed, Lost or Stolen Certificates.
-------------------------------------------------
If (a) any mutilated Certificate shall be surrendered to the Certificate
Registrar, or if the Certificate Registrar and the Owner Trustee shall receive
evidence to its satisfaction of the destruction, loss or theft of any
Certificate, and (b) there shall be delivered to the Certificate Registrar and
the Owner Trustee such security or indemnity as may be required by them to save
each of them harmless, then in the absence of notice to the Trust that such
Certificate has been acquired by a protected purchaser, the Owner Trustee or the
Certificate Registrar on behalf of the Trust shall execute and the Owner Trustee
or the Certificate Registrar shall authenticate and deliver, in exchange for or
in lieu of any such mutilated, destroyed, lost or stolen Certificate, a new
Certificate of like tenor and denomination. The Holder of such Certificate shall
pay the reasonable expenses and charges of the Certificate Registrar and the
Owner Trustee in
10
connection therewith. In connection with the issuance of any new Certificate
under this Section, the Owner Trustee or the Certificate Registrar may require
the payment of a sum sufficient to cover any tax or other governmental charge
that may be imposed in connection therewith. Any duplicate Certificate issued
pursuant to this Section shall constitute conclusive evidence of ownership of a
beneficial interest in the Trust, as if originally issued, whether or not the
lost, stolen or destroyed Certificate shall be found at any time.
Section 3.06 Persons Deemed Owners.
---------------------
Prior to due presentation of a Certificate for registration of transfer,
the Owner Trustee, the Certificate Registrar or any Paying Agent or other agent
thereof may treat the Person in whose name any Certificate is registered in the
Certificate Register as the owner of such 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 or other agent thereof shall be bound by any notice to the
contrary.
Section 3.07 Access to List of Certificateholders' Names and Addresses.
---------------------------------------------------------
The Certificate Registrar shall furnish or cause to be furnished to the
Paying Agent, the Owner Trustee, the Servicer and the Trust Depositor, within
ten (10) days after receipt by the Certificate Registrar of a written request
therefor from the Paying Agent, the Owner Trustee, the Servicer or the Trust
Depositor, a list, in such form as the Paying Agent, the Owner Trustee, the
Servicer or the Trust Depositor may reasonably require, of the names and
addresses of the Certificateholders as of the most recent Record Date. If three
(3) or more Certificateholders or one or more Holders of Certificates evidencing
not less than 25% of the Percentage Interests apply in writing to the
Certificate Registrar, and such application states that the applicants desire to
communicate with other Certificateholders with respect to their rights under
this Trust Agreement or under the Certificates and such application is
accompanied by a copy of the communication that such applicants propose to
transmit, then the Certificate Registrar shall, within five (5) Business Days
after the receipt of such application, afford such applicants access during
normal business hours to the current list of Certificateholders. Upon receipt of
any such application, the Certificate Registrar will promptly notify the Trust
Depositor by providing a copy of such application and a copy of the list of
Certificateholders produced in response thereto. Each Certificateholder, by
receiving and holding a Certificate, shall be deemed to have agreed not to hold
any of the Trust Depositor, the Certificate Registrar and the Owner Trustee
accountable by reason of the disclosure of its name and address, regardless of
the source from which such information was derived.
Section 3.08 Maintenance of Office or Agency.
-------------------------------
The Certificate Registrar shall maintain an office or offices or agency or
agencies where Certificates may be surrendered for registration of transfer or
exchange and where notices and demands to or upon the Certificate Registrar in
respect of the Certificates and the Transaction Documents may be served. The
Certificate Registrar initially designates the office of the Certificate
Registrar at the Corporate Trust Office as its office for such purposes. The
Certificate
11
Registrar shall give prompt written notice to the Trust Depositor, any Paying
Agent, the Owner Trustee 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 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 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 Trust Agreement in any material respect. The Paying Agent initially
shall be Xxxxx Fargo Bank Minnesota, National Association (the "Paying Agent").
------------
Xxxxx Fargo Bank Minnesota, National Association shall be permitted to resign as
Paying Agent upon thirty (30) days' written notice to the Owner Trustee and the
Servicer. In the event that Xxxxx Fargo Bank Minnesota, National Association
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 the Paying Agent and such successor Paying Agent or any
additional Paying Agent appointed by the Owner Trustee to execute and deliver to
the Owner Trustee an instrument in which the Paying Agent and such successor
Paying Agent or additional Paying Agent shall agree with the Owner Trustee that,
as Paying Agent, the Paying Agent and 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 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, 7.04, 7.05, 7.06, 8.01
------------- ---- ---- ---- ----
and 8.02 shall apply to Xxxxx Fargo Bank Minnesota, National Association or the
----
Owner Trustee also in its role as Paying Agent and Certificate Registrar as if
Xxxxx Fargo Bank Minnesota, National Association and the Owner Trustee were
named in such Sections, for so long as Xxxxx Fargo Bank Minnesota, National
Association or the Owner Trustee shall act as Paying Agent or Certificate
Registrar and, to the extent applicable, to any other paying agent or
certificate registrar 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 Transfer Restrictions.
---------------------
The Certificates may not be offered, transferred or sold except to the
Trust Depositor or an Affiliate thereof or to institutional "accredited
investors" (as defined in Rule 501(a)(1)-(3) or (7) under the Securities Act who
are United States persons (as defined in Section 7701(a)(30) of the Code) in
reliance on an exemption from the registration requirements of the Securities
Act.
(a)The Certificates have not been registered or qualified under the
Securities Act, or any state securities law. No transfer, sale, pledge or other
disposition of any Certificate shall be made unless such disposition is made
pursuant to an effective registration statement under the
12
Securities Act and effective registration or qualification under applicable
state securities laws, or is made in a transaction which does not require such
registration or qualification. No transfer of any Certificates shall be made if
such transfer would require the Trust to register as an "investment company"
under the Investment Company Act. In the event that a transfer is to be made,
the transferee shall execute and deliver to the Owner Trustee a certification
substantially in the form of Exhibit C hereto. In the event that such transfer
---------
is to be made in reliance on the availability of an exemption under the
Securities Act, the Owner Trustee may require the prospective transferee to
provide an opinion of counsel satisfactory to it that such transfer may be made
pursuant to an exemption from the Securities Act, which opinion of counsel shall
not be an expense of the Owner Trustee or of the Trust.
(b)Neither the Certificates nor any beneficial interest in such
Certificates may be acquired by or with the assets of (i) employee benefit
plans, retirement arrangements, individual retirement accounts or Xxxxx plans
subject to either Title I of the Employee Retirement Income Security Act of
1974, as amended, or Section 4975 of the Code (a "Benefit Plan") or (ii)
------------
entities (including insurance company general accounts) whose underlying assets
include plan assets by reason of the investment by any such plans, arrangements
or accounts in such entities (a "Benefit Plan Investor") and any such purported
---------------------
transfer shall not be effective. Each transferee of a Certificate shall be
required to represent (a) that it is not a Benefit Plan or Benefit Plan Investor
and is not acquiring such Certificate with the assets of a Benefit Plan or
Benefit Plan Investor and (b) that if such Certificate is subsequently deemed to
be a plan asset, it will dispose of such Certificate.
(c)Each Certificate will bear the legends set forth in paragraph 6 of
-----------
Exhibit C hereto.
---------
(d)No transfer, sale, pledge or other disposition of one or more
Certificates (a "Transfer") shall be made unless simultaneously with the
Transfer (1) a proportionate amount of Class C Notes are Transferred so that the
ratio of the Percentage Interest of the Certificates so Transferred to all
Certificates and the ratio of the Percentage Interest of the Class C Notes so
Transferred to the Percentage Interest of all Class C Notes are equal and (2)
the Transfers of the Certificates and Class C Notes referred to herein are made
to the same Person.
(e)Notwithstanding any other provision herein or elsewhere, other than to
determine that any certification delivered to the Owner Trustee pursuant to
Section 3.10(a) hereof is substantially in the form of Exhibit C hereto and to
determine (including, without limitation, based on one or more certificates from
the Person transferring such Certificate and/or the Note Registrar) that any
transfer of a Certificate described in such certification delivered to the Owner
Trustee complies with Section 3.10(d), the Owner Trustee shall have no
obligation to determine whether or not any transfer or exchange or proposed or
purported transfer or exchange of a Certificate is permitted under or in
accordance with this Agreement, and the Owner Trustee shall have no personal
liability to any Person in connection with any transfer or exchange or proposed
or purported transfer or exchange (and/or registration thereof).
13
ARTICLE IV
ACTIONS BY OWNER TRUSTEE
Section 4.01 Prior Notice to and Consent by Certificateholders with Respect
--------------------------------------------------------------
to Certain Matters.
------------------
With respect to the following matters, the Trust shall not take action
unless, at least five (5) days before the taking of such action, the Owner
Trustee shall have notified the Certificateholders in writing of the proposed
action and the Certificateholders holding a Percentage Interest of not less than
66% shall not, prior to the fifth (5th) day after such notice is given, have
notified the Owner Trustee in writing that such Certificateholders have withheld
consent or provided alternative direction:
(a)the initiation of any material claim or lawsuit by the Trust and the
compromise of any material action, claim or lawsuit brought by or against the
Trust;
(b)the election by the Trust to file an amendment to the Certificate of
Trust (unless such amendment is required to be filed under the Business Trust
Statute);
(c)the amendment of the Indenture by a supplemental indenture in
circumstances where the consent of any Noteholder is required;
(d)the amendment of the Indenture by a supplemental indenture in
circumstances where the consent of any Noteholder is not required and such
amendment materially adversely affects the interest of the Certificateholders;
(e)the appointment pursuant to the Indenture of a successor Paying Agent or
Indenture Trustee or pursuant to this Trust Agreement of a successor Certificate
Registrar, or the consent to the assignment by the Paying Agent or Indenture
Trustee or Certificate Registrar of its obligations under the Indenture or this
Trust Agreement, as applicable;
(f)the consent to the calling or waiver of any Event of Default of any
Transaction Document;
(g)the consent to the assignment of the Indenture Trustee or Servicer of
their respective obligations under any Transaction Document;
(h)except as provided in Article IX hereof, the dissolution, termination or
----------
liquidation of the Trust in whole or in part;
(i)the merger or consolidation of the Trust with or into any other entity,
or conveyance or transfer of all or substantially all of the Trust's assets to
any other entity;
14
(j)the incurrence, assumption or guaranty by the Trust of any indebtedness
other than as set forth in this Agreement or the Transaction Documents;
(k)the doing of any act which would make it impossible to carry on the
ordinary business of the Trust as described in Section 2.03 hereof;
------------
(l)the confession of a judgment against the Trust;
(m)the possession of Loan Assets, or assignment of the Trust's right to
property, for other than a purpose permitted under Section 2.03;
------------
(n)the lending by the Trust of any funds to any entity;
(o)the change in the Trust's purpose and powers from those set forth in
this Trust Agreement; or
(p)the removal or replacement of the Servicer or the Indenture Trustee.
In addition, the Trust shall not commingle its assets with those of any
other entity. The Trust shall maintain its financial and accounting books and
records separate from those of any other entity. Except as expressly set forth
herein, the Trust shall pay its indebtedness, operating expenses and liabilities
from its own funds, and the Trust shall not pay the indebtedness, operating
expenses and liabilities of any other entity.
Section 4.02 [Reserved].
--------
Section 4.03 Action by Certificateholders with Respect to Bankruptcy.
-------------------------------------------------------
The Trust shall not have the power, without the unanimous prior written
approval of the Certificateholders, and to the extent otherwise consistent with
the Transaction Documents, to (i) institute proceedings to have the Trust
declared or adjudicated as bankrupt or insolvent, (ii) consent to the
institution of bankruptcy or insolvency proceedings against the Trust, (iii)
file a petition or consent to a petition seeking reorganization or relief on
behalf of the Trust under any applicable federal or state law relating to
bankruptcy, (iv) consent to the appointment of a receiver, liquidator, assignee,
trustee, sequestrator (or any similar official) of the Trust or a substantial
portion of the property of the Trust, (v) make any assignment for the benefit of
the Trust's creditors, (vi) cause the Trust to admit in writing its inability to
pay its debts generally as they become due, (vii) take any action, or cause 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, no
-----------------
Certificateholder shall have the power to take and shall not take any Bankruptcy
Action with respect to the Trust or direct the Owner Trustee to take any
Bankruptcy Action with respect to the Trust.
15
Section 4.04 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 Trust Agreement or
any of the Transaction Documents or would cause a violation of any of the
Transaction Documents or would be contrary to or inconsistent with Section 2.03,
------------
nor shall the Owner Trustee be obligated to follow any such direction, if given.
Section 4.05 Majority Control.
----------------
Except as expressly provided herein or in any supplement to this Trust
Agreement, any action or direction that may be taken or given by the
Certificateholders under this Trust Agreement may not be taken or given unless
agreed to by the Holders of Certificates evidencing not less than a majority of
the aggregate Percentage Interest. Except as expressly provided herein or in any
supplement to this Trust Agreement, any written notice of the Certificateholders
delivered pursuant to this Trust Agreement shall be effective if signed by
Certificateholders holding Certificates evidencing not less than a majority of
the aggregate Percentage Interest at the time of the delivery of such notice.
ARTICLE V
APPLICATION OF TRUST FUNDS; CERTAIN DUTIES
Section 5.01 Establishment of Trust Account.
------------------------------
(a)For the benefit of the Certificateholders, the Paying Agent shall
establish and maintain in the name of the Trust an Eligible Deposit Account with
the Indenture Trustee (the "Certificate Account"), bearing a designation clearly
-------------------
indicating that the funds deposited therein are held for the benefit of the
Certificateholders. Each Qualified Institution maintaining the Certificate
Account shall agree in writing (and the Indenture Trustee does hereby so agree)
to comply with all instructions originated by the Paying Agent or Owner Trustee
directing the disposition of funds in the account without the further consent of
the Trust.
(b)The Trust shall possess all right, title and interest in all funds on
deposit from time to time in the Certificate Account and in all proceeds
thereof. Except as provided in Section 3.09 or as otherwise expressly provided
------------
herein, the Certificate Account shall be under the sole dominion and control of
the Owner Trustee for the benefit of the Certificateholders. If, at any time,
the Certificate Account ceases to be an Eligible Deposit Account, the Paying
Agent shall within ten (10) Business Days (or such longer period, not to exceed
thirty (30) calendar days, as to which each Rating Agency may consent) establish
a new Certificate Account as an Eligible Deposit Account and shall transfer any
cash and/or any investments to such new Certificate Account.
16
Section 5.02 Application of Trust Funds.
--------------------------
(a)On each Remittance Date and at the instruction of the Servicer, the
Paying Agent shall distribute to the Certificateholders, pro rata based on their
respective Percentage Interests, the amounts deposited in the Certificate
Account received from the Indenture Trustee pursuant to the Indenture or the
Sale and Servicing Agreement.
(b)On each Remittance Date, the Indenture Trustee shall, or shall cause the
Paying Agent to, make available to each Certificateholder the statement or
statements provided to the Indenture Trustee by the Servicer pursuant to the
Indenture and the Sale and Servicing Agreement with respect to such Remittance
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 the Certificateholder in accordance with this
Section. The Paying Agent is 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 Requirements of Law, pending the outcome of such proceedings). The
amount of any withholding tax imposed with respect to a Certificateholder shall
be treated as cash distributed to such Certificateholder at the time it is
withheld by the Trust and remitted to the appropriate taxing authority. If there
is a possibility that withholding tax is payable with respect to a distribution
(such as a distribution to a non-U.S. Certificateholder), the Paying Agent may
in its sole discretion withhold such amounts in accordance with this
subparagraph (c). In the event that a Certificateholder wishes to apply for a
---------------
refund of any such withholding tax, the Owner Trustee or the Paying Agent shall
reasonably cooperate with such Certificateholder in making such claim so long as
such Certificateholder agrees to reimburse the Owner Trustee and the Paying
Agent for any out-of-pocket expenses incurred.
Section 5.03 Method of Payment.
-----------------
Subject to subsection 9.01(c), distributions required to be made to
-----------------
Certificateholders on any Remittance 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
(5) Business Days prior to such Remittance Date or, if not, by check mailed to
such Certificateholder at the address of such holder 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 or
------------- ----
the Paying Agent hereunder need not be segregated in any manner except to the
extent required by any
17
Requirement of Law or the Sale and Servicing Agreement and may be deposited
under such general conditions as may be prescribed by any Requirement of Law,
and neither the Paying Agent, the Trust Company nor the Owner Trustee shall be
liable for any interest thereon.
Section 5.05 Accounting and Reports to the Certificateholders, the Internal
--------------------------------------------------------------
Revenue Service and Others.
--------------------------
The Trust Depositor shall (a) maintain (or cause to be maintained) the
books of the Trust on a calendar year basis on the accrual method of accounting,
(b) deliver (or cause to be delivered) to each Certificateholder, as may be
required by the Code and applicable Treasury Regulations, such information as
may be required (including, if applicable, Schedule K-1) to enable each
Certificateholder to prepare its federal and state income tax returns, (c)
prepare or cause to be prepared, and file, or cause to be filed, all tax
returns, if any, relating to the Trust (including, if applicable, a partnership
information return, IRS Form 1065) and in writing direct the Owner Trustee to
make such elections as from time to time may be required or appropriate under
any applicable state or federal statute or any rule or regulation thereunder so
as to maintain the Trust's characterization as a partnership for federal income
tax purposes or an entity the existence of which is disregarded as separate from
the Certificateholders under applicable Treasury Regulations depending on
whether the Certificates are held by one owner or more than one owner, and (d)
collect or cause to be collected any withholding tax as described in and in
accordance with subsection 5.02(c) with respect to income or distributions to
-----------------
Certificateholders. The Owner Trustee shall make all elections pursuant to this
Section 5.05 as directed by the Trust Depositor in writing.
------------
Section 5.06 Signature on Returns; Tax Matters Partner.
-----------------------------------------
(a)The Servicer shall sign on behalf of the Trust the tax returns of the
Trust, and any other returns as may be required by law if any, as the same shall
be furnished to it in execution form by the Trust Depositor, unless a
Requirement of Law requires a Certificateholder to sign such documents, in which
case such documents shall not be furnished to the Owner Trustee, but shall be
furnished to and signed by the Trust Depositor so long as it is a
Certificateholder, in its capacity as "tax matters partner", or such other
Certificateholder as may have been designated "tax matters partner". In
executing any such return, the Servicer shall rely entirely upon, and shall have
no personal liability for, information or calculations provided by the Trust
Depositor.
(b)In the event the Trust Depositor is a Certificateholder, the Trust
Depositor shall be the "tax matters partner" of the Trust pursuant to the Code.
18
ARTICLE VI
AUTHORITY AND DUTIES OF OWNER TRUSTEE
Section 6.01 General Authority.
-----------------
Each of the Owner Trustee, the Servicer and the Trust Depositor shall have
power and authority, and each is hereby authorized and empowered, in the name
and on behalf of the Trust, to execute and deliver the Transaction 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 Transaction Documents to which the Trust
is to be a party and any amendment or other agreement or instrument, in each
case, in such form as the Owner Trustee, the Servicer or the Trust Depositor
shall approve, as evidenced conclusively by the Owner Trustee's, the Servicer's
or the Trust Depositor's execution thereof. In addition to the foregoing, the
Owner Trustee shall have power and authority and hereby is further authorized,
but shall not be obligated, to take all actions required of the Trust pursuant
to the Transaction Documents. The Owner Trustee shall have power and authority
and hereby is further authorized from time to time to take such action as the
Servicer recommends with respect to the Transaction Documents.
Section 6.02 General Duties.
--------------
It shall be the duty of the Owner Trustee to discharge (or cause to be
discharged) all of the duties expressly required to be performed by the Owner
Trustee under the terms of this Agreement and the Transaction Documents to which
the Trust is a party in the interest of the Certificateholders, subject to the
Transaction Documents and in accordance with the provisions of this Agreement.
Notwithstanding the foregoing, the Owner Trustee shall be deemed to have
discharged its duties and responsibilities hereunder and under the Transaction
Documents to the extent the Trust Depositor has agreed hereunder or the Servicer
has agreed in the Sale and Servicing Agreement to perform any act or to
discharge any duty of the Owner Trustee or of the Trust under any Transaction
Document, and the Owner Trustee shall not be held personally liable for the
default or failure of the Trust Depositor or the Servicer to carry out its
obligations under the Sale and Servicing Agreement or this Trust Agreement, as
applicable.
Section 6.03 Action upon Instruction.
-----------------------
(a)Subject to Article IV and Section 7.01 and in accordance with the terms
---------- ------------
of the Transaction 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 Transaction Document if the Owner Trustee shall have reasonably
determined, or shall have been advised by counsel, that such action is likely to
result in personal liability on the part of the Owner Trustee or is contrary to
the terms hereof or of any Transaction Document or is otherwise contrary to
Requirements of Law.
19
(c)Whenever the Owner Trustee is unable to decide between alternative
courses of action permitted or required by the terms of this Trust Agreement or
under any Transaction Document, the Owner Trustee shall promptly give notice (in
such form as shall be appropriate under the circumstances) to the
Certificateholders requesting instruction as to the course of action to be
adopted, and to the extent the Owner Trustee acts or refrains from acting in
good faith in accordance with any written instruction received from Holders of
Certificates evidencing not less than a majority of the aggregate Percentage
Interest, the Owner Trustee shall not be personally liable on account of such
action or inaction to any Person. If the Owner Trustee shall not have received
appropriate instruction within ten (10) days of such notice (or within such
shorter period of time as reasonably may be specified in such notice or may be
necessary under the circumstances) it may, but shall be under no duty to, take
or refrain from taking such action not inconsistent with this Agreement and the
other Transaction Documents as it shall deem to be in the best interests of the
Certificateholders and shall have no personal 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 Trust Agreement or any Transaction 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 Trust
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 or
permitted to take with respect to a particular set of facts, the Owner Trustee
may give notice (in such form as shall be appropriate under the circumstances)
to the Certificateholders requesting instruction and, to the extent that the
Owner Trustee acts or refrains from acting in good faith in accordance with any
such instruction received from Holders of Certificates evidencing not less than
a majority of the aggregate Percentage Interest, the Owner Trustee shall not be
personally liable, on account of such action or inaction, to any Person. If the
Owner Trustee shall not have received appropriate instruction within ten (10)
days of such notice (or within such shorter period of time as reasonably may be
specified in such notice or may be necessary under the circumstances) it may,
but shall be under no duty to, take or refrain from taking such action not
inconsistent with this Agreement or the other Transaction Documents as it shall
deem to be in the best interests of the Certificateholders, and shall have no
personal 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 otherwise take or refrain from taking any action
under, or in connection with, the Transaction Documents or any document
contemplated hereby or thereby, except as expressly provided by the terms of
this Trust 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 Trust Agreement or any other Transaction Document
against the Owner Trustee. Except as may be expressly provided in any
Transaction Document, 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
20
hereunder or to prepare or file any Commission filing for the Trust or to record
this Trust Agreement or any Transaction Document. The Trust Company nevertheless
agrees that it will, at its own cost and expense, promptly take all action as
may be necessary to discharge any liens on any part of the Trust Estate that
result from actions by, or claims against, the Trust Company that are not
related to the Trust, this Trust Agreement, the Trust Company's serving as Owner
Trustee or the ownership or the administration of the Trust Estate.
Section 6.05 Restrictions.
------------
The Owner Trustee shall not take any action that, (i) is inconsistent with
the purposes of the Trust set forth in Section 2.03 or (ii) to the actual
------------
knowledge of a Responsible Officer 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.
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 but only upon the terms of this Trust Agreement. The Owner
Trustee also agrees to disburse all moneys actually received by it constituting
part of the Trust Estate upon the terms of this Trust Agreement and the other
Transaction Documents. The Owner Trustee shall not be personally answerable or
accountable hereunder or under any other Transaction Document under any
circumstances, except to the Trust and the Certificateholders (i) for its own
willful misconduct, bad faith 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 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 personally liable for any error of
judgment made by a Responsible Officer of the Owner Trustee which did not result
from gross negligence on the part of such Responsible Officer;
(b) the Owner Trustee shall not be personally liable with respect to any
action taken or omitted to be taken by it in accordance with the instructions of
the Trust Depositor, the Servicer or any Certificateholder;
(c) no provision of this Trust Agreement or any other Transaction Document
shall require the Owner Trustee to expend or risk its own funds or otherwise
incur any personal financial liability in the performance of any of its rights
or powers hereunder or under any Transaction Document if the Owner Trustee shall
have reasonable grounds for believing that
21
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 personally liable for
indebtedness evidenced by or arising under any of the Transaction Documents,
including the principal of and interest on the Notes;
(e) the Owner Trustee shall not be personally responsible (i) for or in
respect of the validity or sufficiency of this Trust Agreement or for the due
execution hereof by the Trust Depositor, (ii) for the form, character,
genuineness, sufficiency, value or validity of any of the Trust Estate, or (iii)
for or in respect of the validity or sufficiency of the Transaction Documents,
other than the Owner Trustee's due execution of the Certificate on behalf of the
Trust and of the certificate of authentication on the Certificates, and the
Owner Trustee shall in no event assume or incur any personal liability, duty, or
obligation to any Noteholder or any Certificateholder other than as expressly
provided for herein or expressly agreed to in the Transaction Documents;
(f) the Owner Trustee shall not be personally liable for the default or
misconduct of the Trust Depositor, the Indenture Trustee or the Servicer or any
other Person under any of the Transaction Documents or otherwise and the Owner
Trustee shall have no obligation or personal liability to perform the
obligations of the Trust under this Trust Agreement or the other Transaction
Documents that are required to be performed by the Indenture Trustee under the
Indenture or the Servicer or the Trust Depositor under the Sale and Servicing
Agreement; and
(g) the Owner Trustee shall be under no obligation to exercise any of the
rights or powers vested in it by this Trust Agreement, or to institute, conduct
or defend any litigation under this Trust Agreement or otherwise or in relation
to this Trust Agreement or any other Transaction Document, at the request, order
or direction of any of the Certificateholders, unless such Certificateholders
have offered to the Owner Trustee security or indemnity satisfactory to it
against the costs, expenses and liabilities that may be incurred by the Owner
Trustee therein or thereby. The right of the Owner Trustee to perform any
discretionary act enumerated in this Trust Agreement or in any other Transaction
Document shall not be construed as a duty, and the Owner Trustee shall not be
personally answerable therefor other than to the Trust and the
Certificateholders for its willful misconduct, bad faith or gross negligence in
the performance of any such act.
Section 7.02 Furnishing of Documents.
-----------------------
The Owner Trustee shall furnish to the Certificateholders duplicates or
copies of all reports, notices, requests, demands, certificates, financial
statements and any other instruments furnished to the Owner Trustee under the
Transaction Documents.
Section 7.03 Representations and Warranties.
-------------------------------
The Owner Trustee hereby represents and warrants to the Trust Depositor,
for the benefit of the Trust Depositor and Certificateholders, that:
22
(a) It is a trust company duly organized and validly existing in good
standing under the laws of the State of Delaware. It has all requisite corporate
power and authority to execute, deliver and perform its obligations under this
Trust Agreement.
(b) It has taken all corporate action necessary to authorize the execution
and delivery by it of this Trust Agreement, and this Trust Agreement will be
executed and delivered by one of its officers who is duly authorized to execute
and deliver this Trust Agreement on its behalf.
(c) Neither the execution nor the delivery by it of this Trust Agreement,
nor the consummation by it of the transactions contemplated hereby nor
compliance by it with any of the terms or provisions hereof, will (i) contravene
any federal or Delaware law, governmental rule or regulation governing the
banking or trust powers of the Trust Company or any judgment or order binding on
it, (ii) constitute any default under its charter documents or bylaws or any
indenture, mortgage, contract, agreement or instrument to which it is a party or
by which any of its properties may be bound or (iii) result in the creation or
imposition of an lien, charge or encumbrance on the Trust Estate resulting from
actions by or claims against the Owner Trustee individually which are unrelated
to this Agreement or the other Transaction Documents.
(d)This Agreement constitutes a legal, valid and binding obligation of the
Owner Trustee enforceable in accordance with its terms, subject to applicable
bankruptcy, insolvency, reorganization and similar laws relating to creditors'
rights generally and creditors of national banking associations and subject to
general principles of equity.
(e) To the Owner Trustee's best knowledge, there are no proceedings or
investigations pending, or to the Owner Trustee's knowledge threatened, before
any court, regulatory body, administrative agency or other governmental
instrumentality having jurisdiction over the Owner Trustee or its properties:
(A) asserting the invalidity of this Trust Agreement, (B) seeking to prevent the
consummation of any of the transactions contemplated by this Trust Agreement or
(C) seeking any determination or ruling that might materially and adversely
affect the performance by the Owner Trustee of its obligations under, or the
validity or enforceability of, this Trust Agreement.
Section 7.04 Reliance; Advice of Counsel.
---------------------------
(a) The Owner Trustee shall incur no personal 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 an appropriate Person or Persons.
The Owner Trustee may accept a certified copy of a resolution of the board of
directors or other governing body of any Person 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
require and rely on a certificate, signed by the president or any vice president
or by the treasurer or other authorized officer or agent of an appropriate
Person or Persons, as to such fact or matter and such certificate shall
constitute full
23
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 Trust Agreement or the
other Transaction Documents, the Owner Trustee 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 personally 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 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 personally liable for anything
done, suffered or omitted in good faith by it in accordance with the written
opinion or advice of any such counsel, accountants or other such Persons. The
Owner Trustee shall have no duty to monitor or supervise any other trustee, the
Certificate Registrar, the Paying Agent, the Trust Depositor, the Holders, the
Servicer, any Subservicer, the Indenture Trustee, any agent, independent
contractor, officer, employee or manager of the Trust, any delegatee of any
trustee, or any other Person.
Section 7.05 Not Acting in Individual Capacity.
---------------------------------
Except as provided in this Article VII, in performing its duties hereunder,
-----------
the Trust Company 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 Trust Agreement or any
Transaction Document shall look only to the Trust Estate for payment or
satisfaction thereof.
Section 7.06 Owner Trustee Not Liable for Certificates or Loans.
--------------------------------------------------
The recitals contained herein and in the Certificates shall be taken as the
statements of the Trust Depositor and the Owner Trustee assumes no personal
responsibility for the correctness thereof. The Owner Trustee makes no
representations as to the validity or sufficiency of this Trust Agreement, of
any other Transaction Document or of the Certificates (other than as to the due
execution by the Owner Trustee of the Certificates on behalf of the Trust and
the certificate of authentication of the Owner Trustee on the Certificates) or
the Notes, or of any Loan or related documents. The Owner Trustee shall at no
time have any personal responsibility or liability for or with respect to the
legality, validity and enforceability of any Loan, or for or with respect to the
sufficiency of the Trust Estate or its ability to generate the payments to be
distributed to Certificateholders under this Trust Agreement or the Noteholders
under the Indenture, including, without limitation: (a) the existence, condition
and ownership of any collateral securing a Loan; (b) the existence and
enforceability of any insurance thereon; (c) the validity of the assignment of
any Loan to the Trust or of any intervening assignment; (d) the performance or
enforcement of any Loan; and (e) the compliance by the Trust Depositor or the
Servicer with any warranty or representation made under any Transaction Document
or in any related document or the accuracy of any such warranty or
representation, or any action of the Trust Depositor, the Indenture Trustee or
the Servicer or any subservicer taken in the name of the Owner Trustee.
24
Section 7.07 Owner Trustee May Own Certificates and Notes.
--------------------------------------------
The Owner Trustee in its individual or any other capacity may become the
owner or pledgee of Certificates or Notes and may deal with the Trust Depositor,
the Indenture Trustee, the Paying Agent and the Servicer in banking transactions
with the same rights as it would have if it were not Owner Trustee.
ARTICLE VIII
COMPENSATION OF OWNER TRUSTEE
Section 8.01 Owner Trustee's Fees and Expenses.
---------------------------------
The Owner Trustee shall receive as compensation for its services hereunder
such fees as have been separately agreed upon before the date hereof between the
Trust Depositor and the Owner Trustee, and the Owner Trustee shall be entitled
to be reimbursed by the Trust Depositor for its other reasonable expenses
hereunder, including, but not limited to, 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. The Trust Depositor shall be responsible for
such fees and expenses only to the extent the same are not paid pursuant to
subsections 7.05(a) or (b) of the Sale and Servicing Agreement.
------------------- ---
Section 8.02 Indemnification.
---------------
Trust Depositor shall be liable as primary obligor for, and shall
indemnify, defend and hold harmless 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 an Indemnified Party in any way relating to or arising out of
this Trust Agreement, the Transaction Documents, the Trust Estate, the
administration of the Trust Estate or the action or inaction of the Owner
Trustee hereunder, except only that the Trust Depositor shall not be liable for
or required to indemnify an Indemnified Party from and against Expenses arising
or resulting from the gross negligence, willful misconduct, bad faith or an
Indemnified Party's material failure to perform under this Agreement or any
Transaction Documents. The indemnities contained in this Section shall survive
the resignation or termination of the Owner Trustee and the termination of this
Trust Agreement. Upon a Responsible Officer of the Owner Trustee determining
that the Owner Trustee will seek indemnification under this Section in regard to
a claim of which a Responsible Officer of the Owner Trustee has obtained actual
knowledge or received written notice, the Owner Trustee promptly shall notify
the Trust Depositor of such claim. The Owner Trustee's failure to give, or delay
in giving, such notice shall not affect the Trust Depositor's obligations under
this Section, except to the extent that such failure or delay results in
material
25
prejudice to the Trust Depositor. An Indemnified Party shall not settle any
claim for which it will seek indemnification under this Section without the
prior written consent of the Trust Depositor, which consent shall not be
unreasonably delayed or withheld.
Section 8.03 Payments to the Owner Trustee.
-----------------------------
Any amounts paid to the Owner Trustee pursuant to this Article VIII 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, be wound up and terminate in
accordance with Section 3808 of the Delaware Business Trust Act upon (i) the
final distribution by the Paying Agent of all moneys or other property or
proceeds of the Trust Estate in accordance with the terms of the Indenture, the
Sale and Servicing Agreement and Article V, upon which the Paying Agent shall
---------
notify the Owner Trustee and the Trust Depositor in writing and (ii) the written
consent of the Certificateholders. The bankruptcy, liquidation, dissolution,
death or incapacity of any Certificateholder shall not (x) operate to dissolve
or terminate this Trust Agreement or the Trust or (y) entitle such
Certificateholder's legal representatives or heirs to claim an accounting or to
take any action or proceeding in any court for a partition or winding up of all
or any part of the Trust or Trust Estate or (z) otherwise affect the rights,
obligations and liabilities of the parties hereto.
(b) Except as provided in subsection 9.01(a), neither the Trust Depositor
------------------
nor any Certificateholder shall be entitled to revoke or terminate the Trust.
(c) Notice of any termination of the Trust, specifying the Remittance Date
upon which the Certificateholders shall surrender their Certificates to the
Paying Agent for payment of the final distribution and cancellation, shall be
given by the Paying Agent by letter to Certificateholders mailed within five (5)
Business Days of receipt of written notice of such termination from the Servicer
stating, as set forth in such notice from the Servicer, (i) the Remittance Date
upon or with respect to which final payment of the Certificates shall be made
upon presentation and surrender of the Certificates at the office of the Paying
Agent therein designated, (ii) the amount of any such final payment and (iii)
that the Record Date otherwise applicable to such Remittance Date is not
applicable, payments being made only upon presentation and surrender of the
Certificates at the office of the Paying Agent therein specified. The Paying
Agent shall give such notice to the Certificate Registrar (if other than the
Owner Trustee) and the Owner Trustee at the time such notice is given to
Certificateholders. Upon presentation and surrender of the Certificates, the
Paying Agent shall cause to be distributed to Certificateholders amounts
distributable on such Remittance Date pursuant to Section 5.02.
------------
26
In the event that all of the Certificateholders shall not surrender their
Certificates for cancellation within six (6) months after the date specified in
the above mentioned written notice, the Paying Agent shall give a second written
notice to the remaining Certificateholders to surrender their Certificates for
cancellation and receive the final distribution with respect thereto. If within
one (1) year after the second notice all the Certificates shall not have been
surrendered for cancellation, the Paying Agent may take appropriate steps, or
may appoint an agent to take appropriate steps, to contact the remaining
Certificateholders concerning surrender of their Certificates, and the cost
thereof shall be paid out of the funds and other assets that shall remain
subject to this Trust Agreement. Any funds remaining in the Trust after
exhaustion of such remedies shall be distributed by the Paying Agent to the
Trust Depositor. Certificateholders shall thereafter look solely to the Trust
Depositor as general unsecured creditors.
(d) Upon the winding up of the Trust and payment of all liabilities in
accordance with Section 3808 of the Business Trust Statute, the Owner Trustee
shall cause the Certificate of Trust to be cancelled by filing a certificate of
cancellation with the Secretary of State in accordance with the provisions of
Section 3810 of the Business Trust Statute. Thereupon, the Trust and this Trust
Agreement (other than the rights, benefits, protections, privileges and
immunities of the Owner Trustee and the Trust Company) 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 Person (a) satisfying the
provisions of Section 3807(a) of the Business Trust Statute; (b) authorized to
exercise corporate trust powers; (c) having a combined capital and surplus of at
least $50,000,000 and subject to supervision or examination by federal or state
authorities; and (d) having (or having a parent that has) a rating of at least
BBB from Fitch, BBB- from S&P and Baa2 from Xxxxx'x. If such Person 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 Person 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.
---------------------------------------
(a) The Owner Trustee may at any time resign and be discharged from the
trusts hereby created by giving written notice thereof to the Trust Depositor.
Upon receiving such notice of resignation, the Trust Depositor shall promptly
appoint a successor Owner Trustee by
27
written instrument, in duplicate, one copy of which instrument shall be
delivered to the resigning Owner Trustee and one (1) copy to the successor Owner
Trustee. If no successor Owner Trustee shall have been so appointed and have
accepted appointment within sixty (60) days after the giving of such notice of
resignation, the resigning Owner Trustee, at the expense of the Trust Depositor,
may petition any court of competent jurisdiction for the appointment of a
successor Owner Trustee.
(b) 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 Trust 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 Trust Depositor may remove the Owner
Trustee. If the Trust Depositor shall remove the Owner Trustee under the
authority of the immediately preceding sentence, the Trust Depositor shall
promptly appoint a successor Owner Trustee by written instrument, in duplicate,
one (1) copy of which instrument shall be delivered to the outgoing Owner
Trustee so removed, and one (1) copy to the successor Owner Trustee, and shall
pay all fees owed to the outgoing Owner Trustee in its individual capacity.
(c) 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, in the case of removal, payment of all
-------------
accrued and unpaid fees and expenses owed to the outgoing Owner Trustee in its
individual capacity. The Trust Depositor shall provide notice of such
resignation or removal of the Owner Trustee to all Holders, the Indenture
Trustee, the Servicer, the Paying Agent and each Rating Agency.
Section 10.03 Successor Owner Trustee.
-----------------------
(a) Any successor Owner Trustee appointed pursuant to Section 10.02 shall
-------------
execute, acknowledge and deliver to the Trust Depositor and to its predecessor
Owner Trustee an instrument accepting such appointment under this Trust
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 Trust Agreement,
with like effect as if originally named as Owner Trustee. The predecessor Owner
Trustee shall upon payment of fees and expenses owing to it in its individual
capacity deliver to the successor Owner Trustee all documents and statements and
monies held by it under this Trust Agreement; and the Trust 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.
28
(b) No successor Owner Trustee shall accept appointment as provided in this
Section unless at the time of such acceptance such successor Owner Trustee shall
be eligible pursuant to Section 10.01.
-------------
(c) Upon acceptance of appointment by a successor Owner Trustee pursuant to
this Section, the Trust Depositor shall mail notice thereof to all Holders, the
Indenture Trustee, the Servicer, each Rating Agency and the Paying Agent. If the
Trust Depositor shall fail to mail such notice within ten (10) 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
Depositor.
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 merger or
-----------------
consolidation to all Holders, each Rating Agency, the Paying Agent, the
Indenture Trustee, the Servicer and the Trust Depositor.
Section 10.05 Appointment of Co-Trustee or Separate Trustee.
---------------------------------------------
(a) Notwithstanding any other provisions of this Trust Agreement, at any
time, for the purpose of meeting any legal requirements of any jurisdiction in
which any part of the Trust Estate may at the time be located, the Trust
Depositor and the Owner Trustee acting jointly shall have the power and
authority to execute and deliver all instruments to appoint one or more Persons
approved by the Trust Depositor and Owner Trustee to act as co-trustee, jointly
with the Owner Trustee, or as separate trustee or separate trustees, of all or
any part of the Trust Estate, and to vest in such Person, in such capacity, such
title to the Trust Estate or any part thereof and, subject to the other
provisions of this Section, such powers, duties, obligations, rights and trusts
as the Trust Depositor and the Owner Trustee may consider necessary or
desirable. If the Trust Depositor shall not have joined in such appointment
within fifteen (15) days after the receipt by it of a request so to do, the
Owner Trustee alone shall have the power, authority and authorization to make
such appointment. No co-trustee or separate trustee under this Trust 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.
-------------
(b) Each separate trustee and co-trustee shall, to the extent permitted by
any Requirement of Law, be appointed and act subject to the following provisions
and conditions:
29
(i) all rights, powers, duties and obligations conferred or imposed
upon the Owner Trustee shall be conferred upon and exercised or performed
by the Owner Trustee and such separate trustee or co-trustee jointly (it
being understood that such separate trustee or co-trustee is not authorized
to act separately without the Owner Trustee joining in such act), except to
the extent that under any Requirement of 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;
(ii) no separate trustee or co-trustee under this Trust Agreement or
the Owner Trustee shall be personally liable by reason of any act or
omission of any other trustee under this Trust Agreement; and
(iii) the Trust Depositor and the Owner Trustee acting jointly may at
any time accept the resignation of or remove any separate trustee or
co-trustee.
(c) Any notice, request or other writing given to the Owner Trustee shall
be deemed to have been given to each of the then separate trustees and
co-trustees, as effectively as if given to each of them. Every instrument
appointing any separate trustee or co-trustee shall refer to this Trust
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 Trust Agreement, specifically including
every provision of this Agreement relating to the conduct of, affecting the
liability of, or affording protection to, the Owner Trustee. Each such
instrument shall be filed with the Owner Trustee and a copy thereof given to
each of the Trust Depositor, the Indenture Trustee, the Paying Agent and the
Servicer.
(d) Any separate trustee or co-trustee may at any time appoint the Owner
Trustee as its agent or attorney-in-fact with full power and authority, to the
extent not prohibited by law, to do any lawful act under or in respect of this
Trust Agreement on its behalf and in its name, and the Owner Trustee shall have
the full power and authority to delegate its responsibilities to the Servicer as
provided for herein and in the other Transaction Documents. 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.
30
ARTICLE XI
MISCELLANEOUS
Section 11.01 Supplements and Amendments.
--------------------------
(a) This Trust Agreement may be amended by the Trust Depositor, the Trust
Company, and the Owner Trustee, without the consent of the Noteholders or the
Certificateholders, to cure any ambiguity, to correct or supplement any
provisions in this Trust Agreement or for the purpose of adding any provisions
to or changing in any manner or eliminating any of the provisions in this Trust
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 an opinion of counsel, adversely affect in any material respect the interests
of any Noteholder or Certificateholder.
(b) This Trust Agreement may also be amended from time to time by the Trust
Depositor, the Trust Company, and the Owner Trustee, with the consent of the
Majority Noteholders and, to the extent affected thereby, the consent of the
Majority Certificateholders, for the purpose of adding any provisions to or
changing in any manner or eliminating any of the provisions of this Trust
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 Loans 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 Noteholders and the aggregate Percentage Interest of
Certificateholders required to consent to any such amendment, without the
consent of the holders of all the outstanding Notes and Certificates.
(c) Promptly after the execution of any such amendment or consent, the
Owner Trustee shall furnish written notification of the substance of such
amendment or consent to each Certificateholder and a copy of each such amendment
or consent to the Paying Agent, the Indenture Trustee, the Servicer and each
Rating Agency.
(d) 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 Trust Agreement or in
any other Transaction Document) and of evidencing the authorization of the
execution thereof by Certificateholders shall be subject to such reasonable
requirements as the Owner Trustee may prescribe.
(e) Promptly after the execution of any amendment to the Certificate of
Trust, the Owner Trustee shall cause the filing of such amendment with the
Secretary of State of Delaware.
(f) Prior to the execution of any amendment to this Trust Agreement or the
Certificate of Trust, the Owner Trustee shall be entitled to receive and rely
upon an opinion of
31
counsel stating that the execution of such amendment is authorized or permitted
by this Trust Agreement. The Owner Trustee and the Trust Company may, but shall
not be obligated to, enter into any such amendment that affects the Owner
Trustee's or the Trust Company's own rights, duties or immunities under this
Trust Agreement or otherwise. Notwithstanding any other provision herein or
elsewhere, no provision, amendment, supplement, waiver, or consent of or with
respect to any of the Transaction Documents that affects any right, power,
authority, duty, benefit, protection, privilege, immunity or indemnity of the
Owner Trustee or the Trust Company shall be binding on the Owner Trustee or the
Trust Company unless the Owner Trustee and the Trust Company shall have
expressly consented thereto in writing.
Section 11.02 No Legal Title to Trust Estate in Certificateholders.
----------------------------------------------------
The Certificateholders shall not have legal title to any part of the Trust
Estate. The Certificateholders shall be entitled to receive distributions with
respect to their undivided beneficial 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 beneficial ownership interest in the Trust Estate shall operate to
dissolve the Trust or terminate this Agreement or the trusts hereunder or
entitle any transferee to an accounting or to the transfer to it of legal title
to any part of the Trust Estate.
Section 11.03 Limitations on Rights of Others.
-------------------------------
The provisions of this Trust Agreement are solely for the benefit of the
Owner Trustee, the Trust Company, the Indemnified Parties, the Trust Depositor,
the Certificateholders and, to the extent expressly provided herein, the
Indenture Trustee and the Noteholders, and nothing in this Trust Agreement,
whether express or implied, shall be construed to give to any other Person any
legal or equitable right, remedy or claim in the Trust Estate or under or in
respect of this Trust 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 (3) Business Days after mailing if mailed by
certified 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 its Corporate Trust Office; or if to the Trust Depositor,
addressed to MCG Finance III, LLC, 0000 Xxxxxx Xxxxxxxxx, Xxxxx 000, Xxxxxxxxx,
Xxxxxxxx 00000, Attention: General Counsel, Facsimile No.: (000) 000-0000 and to
000 Xxxxxxxxx Xxxxx, Xxxxx 000, Xxxxxxxx, Xxxxxxxx 00000, Attention: Chief
Financial Officer, Facsimile No.: (000 000-0000, or, as to each party, at such
other address as shall be designated by such party in a written notice to each
other party.
(b) Any notice required or permitted to be given to a Certificateholder
shall be given by first-class mail, postage prepaid, at the address of such
Certificateholder as shown in the Certificate Register. Any notice so mailed
within the time prescribed in this Trust Agreement
32
shall be conclusively presumed to have been duly given when mailed, whether or
not the Certificateholder receives such notice.
Section 11.05 Severability.
------------
Any provision of this Trust Agreement that is prohibited or unenforceable
in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent
of such prohibition or unenforceability without invalidating the remaining
provisions hereof, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction.
Section 11.06 Separate Counterparts.
---------------------
This Trust 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 Trust Depositor, the Owner Trustee, the
Trust Company, each Certificateholder and their respective 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 No Petition.
-----------
(a) The Trust Depositor will not, prior to the date which is one (1) year
and one (1) day after the termination of the Indenture, institute against the
Trust any bankruptcy proceedings under any United States Federal or state
bankruptcy or similar law in connection with any obligations relating to the
Certificates, the Notes, this Trust Agreement or any of the other Transaction
Documents.
(b) The Owner Trustee, by entering into this Trust Agreement, each
Certificateholder, by accepting a Certificate, and the Indenture Trustee and
each Noteholder, by accepting the benefits of this Trust Agreement, hereby
covenant and agree that they will not, prior to the date which is one (1) year
and one (1) day after the termination of the Indenture, institute against the
Trust, or join in any institution against 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 Certificates, the Notes, this
Trust Agreement or any of the other Transaction Documents.
33
Section 11.09 No Recourse.
-----------
Each Certificateholder by accepting a Certificate acknowledges that such
Certificateholder's Certificates represent beneficial interests in the Trust
only and do not represent interests in or obligations of the Trust Depositor,
the Servicer, the Owner Trustee, the Trust Company, 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 Trust
Agreement, the Certificates or the Transaction Documents.
Section 11.10 Headings.
--------
The headings of the various Articles and Sections herein are for
convenience of reference only and shall not define or limit any of the terms or
provisions hereof.
Section 11.11 GOVERNING LAW.
-------------
THIS AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE
OF DELAWARE, WITHOUT REFERENCE TO ITS CONFLICT OF LAW PROVISIONS, AND THE
OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN
ACCORDANCE WITH SUCH LAWS.
Section 11.12 Third Party Rights.
------------------
The parties hereto agree that each of the Indemnified Parties shall be
deemed a third-party beneficiary of this Trust Agreement entitled to the rights
and benefits set forth herein as fully as if it were a party hereto.
[Remainder of Page Intentionally Left Blank.]
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.
MCG FINANCE III, LLC, as Trust Depositor
By: /s/ Xxxxxx X. Xxxxxxxxxx
-------------------------------------
Name: Xxxxxx X. Xxxxxxxxxx
-----------------------------------
Title: General Counsel and Executive
Vice President
----------------------------------
WILMINGTON TRUST COMPANY, as Owner
Trustee and as the Trust Company
By: /s/ Xxxxxx X. XxxXxxxxx
-------------------------------------
Name: Xxxxxx X. XxxXxxxxx
-----------------------------------
Title: Vice President
----------------------------------
XXXXX FARGO BANK MINNESOTA,
NATIONAL ASSOCIATION, hereby
accepts the appointment as Certificate
Registrar and Paying Agent pursuant to
Sections 3.04 and 3.09 hereof.
------------- ----
By: /s/ Xxx Xxxxxx
--------------------------------------------------
Name: Xxx Xxxxxx
------------------------------------------------
Title: Assistant Vice President
-----------------------------------------------
1
EXHIBIT A
FORM OF CERTIFICATE
-------------------
THIS CERTIFICATE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE "ACT") OR STATE SECURITIES LAWS. THE HOLDER HEREOF, BY PURCHASING
---
THIS CERTIFICATE, AGREES THAT THIS CERTIFICATE MAY BE RESOLD, PLEDGED OR
OTHERWISE TRANSFERRED ONLY IN ACCORDANCE WITH ANY APPLICABLE STATE SECURITIES
LAWS AND TO A PERSON WHO HAS FURNISHED TO THE OWNER TRUSTEE (A) AN INVESTMENT
LETTER TO THE EFFECT THAT SUCH PURCHASER IS THE TRUST DEPOSITOR OR AN AFFILIATE
THEREOF, OR AN INSTITUTIONAL ACCREDITED INVESTOR WITHIN THE MEANING OF RULE
501(a)(1)-(3) or (7) UNDER THE ACT AND (B) IF REQUIRED, AN OPINION OF COUNSEL
SATISFACTORY TO THE OWNER TRUSTEE.
THIS CERTIFICATE MAY NOT BE TRANSFERRED DIRECTLY OR INDIRECTLY TO (1) EMPLOYEE
BENEFIT PLANS, RETIREMENT ARRANGEMENTS, INDIVIDUAL RETIREMENT ACCOUNTS OR XXXXX
PLANS SUBJECT TO EITHER TITLE I OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT
OF 1974, AS AMENDED, OR SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986, AS
AMENDED, OR (2) ENTITIES (INCLUDING INSURANCE COMPANY GENERAL ACCOUNTS) WHOSE
UNDERLYING ASSETS INCLUDE PLAN ASSETS BY REASON OF ANY SUCH PLAN'S,
ARRANGEMENT'S OR ACCOUNT'S INVESTMENT IN SUCH ENTITIES. FURTHER, THIS
CERTIFICATE MAY BE TRANSFERRED ONLY TO A UNITED STATES PERSON WITHIN THE MEANING
OF SECTION 7701(a)(30) OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED.
THIS CERTIFICATE IS NOT GUARANTEED OR INSURED BY ANY GOVERNMENTAL AGENCY.
NO TRANSFER, SALE, PLEDGE OR OTHER DISPOSITION OF ONE OR MORE CERTIFICATES (A
"TRANSFER") SHALL BE MADE UNLESS SIMULTANEOUSLY WITH THE TRANSFER (1) A
--------
PROPORTIONATE AMOUNT OF CLASS C NOTES ARE TRANSFERRED SO THAT THE RATIO OF THE
PERCENTAGE INTEREST OF THE CERTIFICATES SO TRANSFERRED TO ALL CERTIFICATES AND
THE RATIO OF THE PERCENTAGE INTEREST OF THE CLASS C NOTES SO TRANSFERRED TO THE
PERCENTAGE INTEREST OF ALL CLASS C NOTES ARE EQUAL AND (2) THE TRANSFERS OF THE
CERTIFICATES AND CLASS C NOTES REFERRED TO HEREIN ARE MADE TO THE SAME PERSON.
A-1-1
NUMBER
-----------
CUSIP NO. PERCENTAGE INTEREST:
--------- --------
A-1-2
MCG COMMERCIAL LOAN TRUST 2001-1
CERTIFICATE
evidencing a beneficial ownership interest in the Trust, as defined below, the
property of which includes primarily the Loans transferred to the Trust by MCG
Finance III, LLC.
(This Certificate does not represent an interest in or obligation of MCG Finance
III, LLC, MCG Capital Corporation (the "Servicer") or the Owner Trustee (as
--------
defined below) (as such or in its individual capacity) or any of their
respective affiliates, except to the extent described below.)
THIS CERTIFIES THAT MCG FINANCE III, LLC is the registered owner of the
nonassessable, fully paid, beneficial ownership interest in MCG COMMERCIAL LOAN
TRUST 2001-1 (the "Trust") formed by MCG Finance III, LLC, in the Percentage
-----
Interest evidenced hereby.
The Trust was created pursuant to a Trust Agreement, dated as of December
1, 2001 (as amended, modified, restated, replaced, waived, substituted,
supplemented or extended from time to time, the "Trust Agreement"), between MCG
---------------
Finance III, LLC, as trust depositor (the "Trust Depositor"), and Wilmington
---------------
Trust Company, as owner trustee (the "Owner Trustee"), a summary of certain of
-------------
the pertinent provisions of which is set forth below. To the extent not
otherwise defined herein, the capitalized terms used herein have the meanings
assigned to them in the Trust Agreement.
This Certificate is one of a duly authorized issue of MCG Commercial Loan
Trust 2001-1 Certificates (herein called the "Certificates"). This 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 Certificate by
virtue of its acceptance hereof assents and by which such holder is bound.
Under the Trust Agreement, there will be distributed on the 20th day of
each month or, if such 20th day is not a Business Day, the next Business Day
(each, a "Remittance Date"), commencing on January, 2001, to the Person in whose
---------------
name this Certificate is registered at the close of business on the last
Business Day of the month immediately preceding the Remittance Date (the "Record
------
Date"), such Certificateholder's Percentage Interest in the amount to be
----
distributed to Certificateholders on such Remittance Date pursuant to the terms
of the Sale and Servicing Agreement and the Indenture.
The holder of this Certificate acknowledges and agrees that its rights to
receive distributions in respect of this Certificate are subordinated to the
rights of the Noteholders as described in the Sale and Servicing Agreement and
the Indenture.
A-1-3
It is the intent of the Trust Depositor, the Servicer, the Holders of the
Class C Notes and the Certificateholders that, for purposes of federal income
taxes, in the event that the Certificates and the Class C Notes are owned by
more than one holder the Trust will be treated as a partnership, the partners of
which are the Certificateholders and the Holders of the Class C Notes and, in
the event that the Certificates and the Class C Notes are all owned by a single
holder, the Trust will be treated as a division of such holder. The
Certificateholders and the Holders of the Class C Notes, by acceptance of a
Certificate and a Class C Note, respectively, agree to treat the Certificates
and Class C Notes as equity and to take no action inconsistent with the
treatment of, the Trust and the Certificates and Class C Notes for such tax
purposes as just described.
Each Certificateholder, by its acceptance of a Certificate, covenants and
agrees that such Certificateholder, will not prior to the date which is one (1)
year and one (1) day after the termination of the Indenture, institute against
the Trust, or join in any institution against the Trust of, any bankruptcy,
reorganization, arrangement, insolvency or liquidation proceedings, or other
proceedings under any United States federal or state bankruptcy or similar law
in connection with any obligations relating to the Certificates, the Notes, the
Trust Agreement or any of the other Transaction Documents.
Distributions on this Certificate will be made as provided in the Trust
Agreement by 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 Certificate or the making of any notation hereon. Except as
otherwise provided in the Trust Agreement and notwithstanding the above, the
final distribution on this Certificate will be made after due notice by the
Paying Agent of the pendency of such distribution and only upon presentation and
surrender of this Certificate at the office or agency maintained for that
purpose by the Paying Agent.
Reference is hereby made to the further provisions of this Certificate set
forth on the reverse hereof, which further provisions shall for all purposes
have the same effect as if set forth at this place.
Unless the certificate of authentication hereon shall have been executed by
an authorized officer of the Owner Trustee or the Certificate Registrar, by
manual signature, this 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 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-1-4
IN WITNESS WHEREOF, the Owner Trustee or the Certificate Registrar, on
behalf of the Trust and not in its individual capacity, has caused this
Certificate to be duly executed.
Date:
MCG COMMERCIAL LOAN TRUST 2001-1
By: WILMINGTON TRUST COMPANY,
solely as Owner Trustee and not in its
individual capacity
By:
--------------------------------------------
Authorized Signatory
OWNER TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Certificates of MCG Commercial Loan Trust 2001-1
referred to in the within-mentioned Trust Agreement.
Date:
WILMINGTON TRUST COMPANY, solely as
Owner Trustee and not in its individual capacity
By:
---------------------------------------------
Authorized Signatory
or
XXXXX FARGO BANK MINNESOTA,
NATIONAL ASSOCIATION, as Certificate
Registrar
By:
---------------------------------------------
Authorized Signatory
A-1-5
[REVERSE OF CERTIFICATE]
The Certificates do not represent an obligation of, or an interest in, the
Trust Depositor, the Servicer, the Owner Trustee or any affiliates of any of
them and no recourse may be had against such parties or their assets, except as
expressly set forth or contemplated herein or in the Trust Agreement, the
Indenture or the Transaction Documents. In addition, this 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 Loans (and
certain other amounts), all as more specifically set forth herein and in the
Transaction Documents. A copy of each of the Transaction Documents may be
examined by any Certificateholder upon written request during normal business
hours at the principal office of the Trust Depositor and at such other places,
if any, designated by the Trust Depositor.
The Trust Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Trust Depositor and the rights of the Certificateholders under the Trust
Agreement at any time, by the Trust Depositor and the Owner Trustee with the
consent of the holders of the Certificates evidencing not less than a majority
of the outstanding Percentage Interest and of the holders of the Majority
Noteholders, each voting as a class. Any such consent by the holder of this
Certificate shall be conclusive and binding on such holder and on all future
holders of this Certificate and of any 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 Certificate. The Trust Agreement also permits the
amendment thereof, in certain limited circumstances, without the consent of the
holders of any of the Certificates.
As provided in the Trust Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registerable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the offices or agencies of the Certificate Registrar, accompanied by
a written instrument of transfer in form satisfactory to the Owner Trustee and
the Certificate Registrar duly executed by the holder hereof or such holder's
attorney duly authorized in writing, and thereupon one or more new Certificates
of authorized denominations evidencing the same aggregate interest in the Trust
will be issued to the designated transferee. The initial Certificate Registrar
appointed under the Trust Agreement is Xxxxx Fargo Bank Minnesota, National
Association.
The Certificates are issuable only as registered Certificates without
coupons in minimum Percentage Interests of 10% and integral multiples of 1% in
excess thereof; provided, however, that one Certificate may be issued in a
-------- -------
different denomination. As provided in the Trust Agreement and subject to
certain limitations therein set forth, Certificates are exchangeable for new
Certificates of authorized denominations evidencing the same aggregate
denomination, as requested by the holder surrendering the same. No service
charge will be made for any such registration of transfer or exchange, but the
Owner Trustee or the Certificate Registrar may require payment of a sum
sufficient to cover any tax or governmental charge payable in connection
therewith.
A-1-6
The Owner Trustee, the Certificate Registrar and any agent of the Owner
Trustee or the Certificate Registrar may treat the Person in whose name this
Certificate is registered as the owner hereof for all purposes, and none of the
Owner Trustee, the Certificate Registrar or any such agent shall be affected by
any notice to the contrary.
This Certificate may not be transferred directly or indirectly to (1)
employee benefit plans, retirement arrangements, individual retirement accounts
or Xxxxx plans subject to either Title I of the Employee Retirement Income
Security Act of 1974, as amended, or Section 4975 of the Internal Revenue Code
of 1986, as amended, or (2) entities (including insurance company general
accounts) whose underlying assets include plan assets by reason of the
investment by such plans, arrangements or accounts in such entities. By
accepting and holding this Certificate, the Holder hereof shall be deemed to
have represented and warranted that it is not any of the foregoing entities.
This Certificate may not be transferred to any person who is not a U.S.
Person, as such term is defined in Section 7701(a)(30) of the Internal Revenue
Code, as amended.
Each purchaser of the Certificates shall be required, prior to purchasing a
Certificate, to execute the Purchaser's Representation and Warranty Letter in
the form attached to the Trust Agreement as Exhibit C.
---------
The obligations and responsibilities created by the Trust Agreement and the
Trust created thereby shall terminate upon (i) 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 and (ii) the written consent of the Certificateholders. The
Servicer on behalf of the Indenture Trustee has the option to cause the sale of
the corpus of the Trust at a price and pursuant to auction procedures specified
in the Indenture and the Sale and Servicing Agreement, and such sale of the
receivables and other property of the Trust will effect early retirement of the
Certificates.
A-1-7
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 Certificate, and all rights thereunder, hereby irrevocably
constituting and appointing
--------------------------------------------------------------------------------
to transfer said Certificate on the books of the Certificate Registrar, with
full power of substitution in the premises.
Dated:
-----------------------------------*
Signature Guaranteed:
-----------------------------------*
----------
* NOTICE: The signature to this assignment must correspond with the name as it
appears upon the face of the within Certificate in every particular, without
alteration, enlargement or any change whatever. Such signature must be
guaranteed by a member firm of the New York Stock Exchange or a commercial bank
or trust company.
A-1-8
EXHIBIT B
CERTIFICATE OF TRUST OF
MCG COMMERCIAL LOAN TRUST 2001-1
--------------------------------
This Certificate of Trust of MCG COMMERCIAL LOAN TRUST 2001-1 (the
"Trust"), is being duly executed and filed by the undersigned, as owner trustee,
-----
to form a business trust under the Delaware Business Trust Act (12 Del. Code,
--- ----
Section. 3801 et seq.) (the "Act").
---
1. Name. The name of the business trust formed hereby is MCG COMMERCIAL
----
LOAN TRUST 2001-1.
2. Delaware Trustee. The name and business address of a trustee of the
----------------
Trust having its principal place of business in the State of Delaware is
Wilmington Trust Company, Xxx Xxxxxx Xxxxxx Xxxxx, Xxxxxxxxxx, Xxxxxxxx 00000
Attention: Corporate Trust Administration.
3. Effective Date. This Certificate of Trust shall be effective upon its
--------------
filing.
IN WITNESS WHEREOF, the undersigned has duly executed this Certificate of
Trust in accordance with Section 3811(a)(1) of the Act.
WILMINGTON TRUST COMPANY,
not in its individual capacity but solely as owner
trustee of the Trust
By:
------------------------------------------------
Name:
----------------------------------------------
Title:
----------------------------------------------
B-1-1
EXHIBIT C
[Form of Purchaser's Representation and Warranty Letter]
MCG Commercial Loan Trust 2001-1
c/o Wilmington Trust Company, as Owner Trustee
Xxx Xxxxxx Xxxxxx Xxxxx
Xxxxxxxxxx, Xxxxxxxx 00000
Attention: Corporate Trust Administration
Re: MCG Commercial Loan Trust 2001-1
--------------------------------
Ladies and Gentlemen:
In connection with our proposed acquisition of Certificates (the
"Certificates") issued under the Trust Agreement, dated as of December 1, 2001
------------
(as amended, modified, restated, replaced, waived, substituted, supplemented or
extended from time to time, the "Agreement"), between MCG Finance III, LLC, as
---------
Trust Depositor (the "Trust Depositor"), and Wilmington Trust Company, as Owner
---------------
Trustee, the undersigned (the "Purchaser") represents, warrants and agrees that:
---------
1. It is the Trust Depositor or an Affiliate thereof, or an institutional
"accredited investor" as defined in Rule 501(a)(1)-(3) or (7) under the
Securities Act and is acquiring the Certificates for its own institutional
account or for the account of an institutional accredited investor.
2. It is not (i) an employee benefit plan, retirement arrangement,
individual retirement account or Xxxxx plan subject to either Title I of the
Employee Retirement Income Security Act of 1974, as amended, or Section 4975 of
the Internal Revenue Code of 1986, as amended, or (2) an entity (including an
insurance company general account) whose underlying assets include plan assets
by reason of the investment by such plans, arrangements or accounts in any such
entity.
3. It is a U.S. Person as defined in Section 7701(a)(30) of the Code.
4. It has such knowledge and experience in evaluating business and
financial matters so that it is capable of evaluating the merits and risks of an
investment in the Certificates. It understands the full nature and risks of an
investment in the Certificates and based upon its present and projected net
income and net worth, it believes that it can bear the economic risk of an
immediate or future loss of its entire investment in the Certificates.
C-1-1
5. It understands that the Certificates will be offered in a transaction
not involving any public offering within the meaning of the Securities Act, and
that, if in the future it decides to resell, pledge or otherwise transfer any
Certificates, such Certificates may be resold, pledged or transferred only (a)
to a person who the seller reasonably believes is an institutional "accredited
investor" as defined in Rule 501(a)(1)-(3) or (7) under the Securities Act that
purchases for its own account or for the account of another institutional
accredited investor or (b) pursuant to an effective registration statement under
the Securities Act.
6. It understands that each Certificate will bear legends substantially to
the following effect:
THIS CERTIFICATE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE "ACT") OR STATE SECURITIES LAWS. THE HOLDER HEREOF, BY PURCHASING
---
THIS CERTIFICATE, AGREES THAT THIS CERTIFICATE MAY BE RESOLD, PLEDGED OR
OTHERWISE TRANSFERRED ONLY IN ACCORDANCE WITH ANY APPLICABLE STATE SECURITIES
LAWS AND TO A PERSON WHO HAS FURNISHED TO THE OWNER TRUSTEE (A) AN INVESTMENT
LETTER TO THE EFFECT THAT SUCH PURCHASER IS THE TRUST DEPOSITOR OR AN AFFILIATE
THEREOF, OR AN INSTITUTIONAL ACCREDITED INVESTOR WITHIN THE MEANING OF RULE
501(a)(1)-(3) OR (7) UNDER THE ACT AND (B) IF REQUIRED, AN OPINION OF COUNSEL
SATISFACTORY TO THE OWNER TRUSTEE.
THIS CERTIFICATE MAY NOT BE TRANSFERRED DIRECTLY OR INDIRECTLY TO (1) EMPLOYEE
BENEFIT PLANS, RETIREMENT ARRANGEMENTS, INDIVIDUAL RETIREMENT ACCOUNTS OR XXXXX
PLANS SUBJECT TO EITHER TITLE I OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT
OF 1974, AS AMENDED, OR SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986, AS
AMENDED, OR (2) ENTITIES (INCLUDING INSURANCE COMPANY GENERAL ACCOUNTS) WHOSE
UNDERLYING ASSETS INCLUDE PLAN ASSETS BY REASON OF ANY SUCH PLAN'S,
ARRANGEMENT'S OR ACCOUNT'S INVESTMENT IN SUCH ENTITIES. FURTHER, THIS
CERTIFICATE MAY BE TRANSFERRED ONLY TO A UNITED STATES PERSON WITHIN THE MEANING
OF SECTION 7701(a)(30) OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED.
THIS CERTIFICATE IS NOT GUARANTEED OR INSURED BY ANY GOVERNMENTAL AGENCY.
NO TRANSFER, SALE, PLEDGE OR OTHER DISPOSITION OF ONE OR MORE CERTIFICATES (A
"TRANSFER") SHALL BE MADE UNLESS SIMULTANEOUSLY WITH THE TRANSFER (1) A
--------
PROPORTIONATE AMOUNT OF CLASS C NOTES ARE TRANSFERRED SO THAT THE RATIO OF THE
PERCENTAGE INTEREST OF THE CERTIFICATES SO TRANSFERRED TO ALL CERTIFICATES AND
THE RATIO OF THE PERCENTAGE INTEREST OF THE CLASS C NOTES SO
C-1-2
TRANSFERRED TO THE PERCENTAGE INTEREST OF ALL CLASS C NOTES ARE EQUAL AND (2)
THE TRANSFERS OF THE CERTIFICATES AND CLASS C NOTES REFERRED TO HEREIN ARE MADE
TO THE SAME PERSON.
7. It is acquiring the Certificates for its own account and not with a view
to the public offering thereof in violation of the Securities Act (subject,
nevertheless, to the understanding that disposition of its property shall at all
times be and remain within its control).
8. It has been furnished with all information regarding the Trust and
Certificates which it has requested from the Trust and the Trust Depositor.
9. Neither it nor anyone acting on its behalf has offered, transferred,
pledged, sold or otherwise disposed of any Certificate, any interest in any
Certificate or any other similar security to, or solicited any offer to buy or
accept a transfer, pledge or other disposition of any Certificate, any interest
in any Certificate or any other similar security from, or otherwise approached
or negotiated with respect to any Certificate, any interest in any Certificate
or any other similar security with, any person in any manner or made any general
solicitation by means of general advertising or in any other manner, which would
constitute a distribution of the Certificates under the Securities Act or which
would require registration pursuant to the Securities Act nor will it act, nor
has it authorized or will authorize any person to act, in such manner with
respect to any Certificate.
10. For the purposes of Section 3(c)(1)(A) of the Investment Company Act,
it shall be counted as one purchaser.
11. It also is acquiring Class C Notes such that the ratio and Percentage
Interest of the Class C Notes being acquired to all Class C Notes and the ratio
and Percentage Interest of the Certificates being acquired to all Certificates
are equal.
C-1-3
Dated:
-----------
Very truly yours,
---------------------------
NAME OF PURCHASER
By:
------------------------
Name;
----------------------
Title:
---------------------
NOTE: To be executed by an
----
executive officer
C-1-4
