TRUST AGREEMENT
between
TMS AUTO HOLDINGS, INC.
and
BANKERS TRUST (DELAWARE)
Owner Trustee
Dated as of November 30, 1997
TABLE OF CONTENTS
PAGE
ARTICLE I
Definitions
SECTION 1.1. Capitalized Terms........................................1
SECTION 1.2. Other Definitional Provisions............................4
ARTICLE II
Organization
SECTION 2.1. Name.....................................................5
SECTION 2.2. Office...................................................5
SECTION 2.3. Purposes and Powers......................................5
SECTION 2.4. Appointment of Owner Trustee.............................6
SECTION 2.5. Initial Capital Contribution of Trust Estate.............6
SECTION 2.6. Declaration of Trust.....................................6
SECTION 2.7. Transfer of Interest to the Holder of
the GP Interest; Liability of the Holder of
the GP Interest..........................................6
SECTION 2.8. Title to Trust Property..................................7
SECTION 2.9. Situs of Trust...........................................7
SECTION 2.10. Representations and Warranties of the Depositor..........7
SECTION 2.11. Covenants of the GP Interest.............................9
SECTION 2.12. Covenants of the Certificateholders.....................10
SECTION 2.13. Voting Interest.........................................11
SECTION 2.14. Federal Income Tax Allocations..........................12
ARTICLE III
Trust Certificates and Transfer of Interests
SECTION 3.1. Initial Ownership......................................12
SECTION 3.2. The Trust Certificates.................................12
SECTION 3.3. Authentication of Trust Certificates...................12
SECTION 3.4. Registration of Transfer and Exchange of Trust
Certificates...........................................13
SECTION 3.5. Mutilated, Destroyed, Lost or Stolen Trust
Certificates...........................................14
SECTION 3.6. Persons Deemed Certificateholders......................14
SECTION 3.7. Access to List of Certificateholders' Names and
Addresses..............................................15
SECTION 3.9. Appointment of Certificate Paying Agent................15
SECTION 3.10. Trust Certificate Transfer Restrictions................16
SECTION 3.11. Disposition by the Holder of the GP Interest...........17
SECTION 3.12. Reserved...............................................17
SECTION 3.13. Reserved...............................................17
SECTION 3.14. [Reserved].............................................17
SECTION 3.15. [Reserved].............................................17
ARTICLE IV
Actions by Owner Trustee
SECTION 4.1. Prior Notice to Certificateholders with
Respect to Certain Matters.............................18
SECTION 4.2. Action by Holder of the Voting Interest
with Respect to Certain Matters........................19
SECTION 4.3. Action by Holder of the Voting Interest
with Respect to Bankruptcy.............................19
SECTION 4.4. Restrictions on the Holder of the Voting
Interest's Power.......................................20
SECTION 4.5. Control by Holder of the Voting Interest...............21
SECTION 4.6. Rights of Security Insurer.............................21
ARTICLE V
Application of Trust Funds:
SECTION 5.1. Establishment of Certificate Distribution Account......21
SECTION 5.2. Application of Funds in Certificate Distribution
Account................................................22
SECTION 5.3. [Reserved].............................................22
SECTION 5.4. Method of Payment......................................23
SECTION 5.5. No Segregation of Monies; No Interest..................23
SECTION 5.6. Accounting and Reports to the
Noteholders, Certificateholders, the
Internal Revenue Service and Others....................23
SECTION 5.7. Signature on Returns; Tax Matters Partner..............23
ARTICLE VI
Authority and Duties of Owner Trustee
SECTION 6.1. General Authority......................................24
SECTION 6.2. General Duties.........................................24
SECTION 6.3. Action upon Instruction................................24
SECTION 6.4. No Duties Except as Specified in this
Agreement or in Instructions...........................25
SECTION 6.5. No Action Except under Specified
Documents or Instructions..............................26
SECTION 6.6. Restrictions...........................................26
SECTION 6.7. Notice of Default Under Indenture......................26
ARTICLE VII
Concerning the Owner Trustee
SECTION 7.1. Acceptance of Trusts and Duties........................26
SECTION 7.2. Furnishing of Documents................................28
SECTION 7.3. Representations and Warranties.........................28
SECTION 7.4. Reliance; Advice of Counsel............................28
SECTION 7.5. Not Acting in Individual Capacity......................29
SECTION 7.6. Owner Trustee Not Liable for Trust
Certificates or Receivables............................29
SECTION 7.7. Owner Trustee May Own Trust Certificates
and Notes..............................................30
SECTION 7.8. Payments from Owner Trust Estate.......................30
SECTION 7.9. Doing Business in Other Jurisdictions..................30
ARTICLE VIII
Compensation of Owner Trustee
SECTION 8.1. Owner Trustee's Fees and Expenses......................30
SECTION 8.2. Indemnification........................................31
SECTION 8.3. Payments to the Owner Trustee..........................31
SECTION 8.4. Non-recourse Obligations...............................31
ARTICLE IX
Termination of Trust Agreement
SECTION 9.1. Termination of Trust Agreement........................31
SECTION 9.2. Dissolution upon Bankruptcy of the
Holder of the GP Interest.............................33
ARTICLE X
Successor Owner Trustees and Additional Owner Trustees
SECTION 10.1 Eligibility Requirements for Owner Trustee............33
SECTION 10.2 Resignation or Removal of Owner Trustee...............34
SECTION 10.3 Successor Owner Trustee...............................35
SECTION 10.4 Merger or Consolidation of Owner Trustee..............35
SECTION 10.5 Appointment of Co-Trustee or Separate Trustee.........35
ARTICLE XI
Miscellaneous
SECTION 11.1. Supplements and Amendments...........................37
SECTION 11.2. No Legal Title to Owner Trust Estate in
Certificateholders...................................38
SECTION 11.3. Limitations on Rights of Others......................38
SECTION 11.4. Notices..............................................38
SECTION 11.5. Severability.........................................39
SECTION 11.6. Separate Counterparts................................39
SECTION 11.7. Successors and Assigns...............................39
SECTION 11.8. [Reserved]...........................................39
SECTION 11.9. No Petition..........................................39
SECTION 11.10. No Recourse..........................................40
SECTION 11.11. Headings.............................................40
SECTION 11.12. GOVERNING LAW........................................40
SECTION 11.13. [Reserved]...........................................40
SECTION 11.14. Servicer.............................................40
SECTION 11.15. Third Party Beneficiary..............................40
EXHIBITS
Exhibit A Form of Trust Certificate
Exhibit B Form of Certificate of Trust
Exhibit C Investment Letter
TRUST AGREEMENT dated as of November
30, 1997 between TMS AUTO HOLDINGS, INC., a
Delaware corporation, and Bankers Trust
(Delaware), a Delaware banking corporation
as Owner Trustee.
ARTICLE I
DEFINITIONS
SECTION 1.1. CAPITALIZED TERMS. For all purposes of this Agreement,
the following terms shall have the meanings set forth below:
"Agreement" shall mean this Trust Agreement, as the same may be
amended and supplemented from time to time.
"Basic Documents" shall mean this Agreement, the Sale and Servicing
Agreement, the Indenture, the Insurance Agreement, the Indemnification
Agreement, the Note Depository Agreement and the other documents and
certificates delivered in connection therewith.
"Benefit Plan" shall have the meaning assigned to such term in Section
3.13.
"Business Trust Statute" shall mean Chapter 38 of Title 12 of the
Delaware Code, 12 DEL. CODE ss. 3801 ET SEQ., as the same may be amended from
time to time.
"Certificate" means a Trust Certificate evidencing the beneficial
interest of a Certificateholder in the Trust, substantially in the form of
Exhibit A attached hereto.
"Certificate Distribution Account" shall have the meaning assigned to
such term in Section 5.1.
"Certificate of Trust" shall mean the Certificate of Trust in the form
of Exhibit B to be filed for the Trust pursuant to Section 3810(a) of the
Business Trust Statute.
"Certificate Paying Agent" shall mean any paying agent or co-paying
agent appointed pursuant to Section 3.9 and shall initially be the Bankers Trust
Company.
"Certificateholder" or "Holder" shall mean the Person in whose name a
Trust Certificate is registered on the Certificate Register.
"Certificate Register" and "Certificate Registrar" shall mean the
register mentioned and the registrar appointed pursuant to Section 3.4.
"Code" shall mean the Internal Revenue Code of 1986, as amended from
time to time, and Treasury Regulations promulgated thereunder.
"Corporate Trust Office" shall mean, with respect to the Owner
Trustee, the principal corporate trust office of the Owner Trustee located at
E.A. Delle Donne Corporate Center Xxxxxxxxxx Building, 0000 Xxxxxx Xxxx, Xxxxx
000, Xxxxxxxxxx, Xxxxxxxx 00000, with a copy of all notices and other documents
to be also furnished to Bankers Trust Company, 0 Xxxxxx Xxxxxx, Xxx Xxxx, Xxx
Xxxx 00000, Attention: Corporate Trust and Agency Group, Structured Finance,
16th floor, or at such other address as the Owner Trustee may designate by
notice to the Certificateholders and the Depositor, or the principal corporate
trust office of any successor Owner Trustee (the address of which the successor
owner trustee will notify the Certificateholders and the Depositor).
"Demand Note" shall have the meaning assigned to such term in Section
2.10(g).
"Depositor" shall mean the Seller in its capacity as Depositor
hereunder.
"Expenses" shall have the meaning assigned to such term in Section
8.2.
"GP Interest" shall mean the meaning assigned to such term in Section
2.7.
"Holder" or "Certificateholder" shall mean the Person in whose name a
Trust Certificate is registered on the Certificate Register.
"Holder of the GP Interest" means TMS Auto Holdings, Inc., a Delaware
special purpose corporation and an affiliate of The Money Store.
"Holder of the Voting Interest" means First Union Bank of Delaware and
any permitted successor, assignee or transferee thereof.
"Indemnified Parties" shall have the meaning assigned to such term in
Section 8.2.
"Minimum Net Worth" means at any time of determination, and with
respect to the Holder of the GP Interest, net worth equal to $945,000. For the
purpose of the determination of Minimum Net Worth: (i) the Demand Note issued to
the Holder of the GP Interest shall be valued at par, (ii) assets subject to a
lien shall be valued at zero, (iii) Certificates or any other interests in any
entity taxable as a partnership for federal income tax purposes shall be valued
at zero, (iv) investments shall be valued at their respective purchase prices
plus accrued interest, and (v) demand notes of The Money Store Inc. issued as
contributions to the Holder of the GP Interest in connection with its status as
a general partner of any other partnership formed pursuant to trust agreements
substantially similar to this Agreement shall be valued at an amount equal to
the excess, if any, of (a) the aggregate current amount of all such demand notes
over (b) $945,000.
"Ownership Percentage" shall mean with respect to any
Certificateholder, the proportion (expressed as a percentage) of the ownership
interest in the Trust held by such Certificateholder.
"Owner Trust Estate" shall mean all right, title and interest of the
Trust in and to the property and rights assigned to the Trust pursuant to
Article II of the Sale and Servicing Agreement, all funds on deposit from time
to time in the Trust Accounts and the Certificate Distribution Account and all
other property of the Trust from time to time, including any rights of the Owner
Trustee and the Trust pursuant to the Sale and Servicing Agreement.
"Owner Trustee" shall mean Bankers Trust (Delaware), a Delaware
banking corporation, not in its individual capacity but solely as owner trustee
under this Agreement, and any successor Owner Trustee hereunder.
"Record Date" shall mean with respect to any Distribution Date, the
last day of the calendar month preceding the Distribution Date.
"Representative" shall mean The Money Store Inc., a New Jersey
corporation, as Representative. "Sale and Servicing Agreement" shall mean the
Sale and Servicing Agreement among the Trust, the Representative, TMS Auto
Holdings, Inc., The Money Store Auto Finance Inc. and the Owner Trustee, dated
as of November 30, 1997, as the same may be amended and supplemented from time
to time.
"Secretary of State" shall mean the Secretary of State of the State of
Delaware.
"Security Insurer" shall mean MBIA Insurance Corporation, or its
successor in interest.
"Security Act" means the Securities Act of 1933, as amended.
"Treasury Regulations" shall mean regulations, including proposed or
temporary regulations, promulgated under the Code. References herein to specific
provisions of proposed or temporary regulations shall include analogous
provisions of final Treasury Regulations or other successor Treasury
Regulations.
"Trust" shall mean the trust established by this Agreement.
"Trust Certificate" shall mean a Certificate.
"Voting Interest" shall have the meaning assigned to such term in
Section 2.13.
SECTION 1.2. OTHER DEFINITIONAL PROVISIONS.
(a) Capitalized terms used herein and not otherwise defined have the
meanings assigned to them in the Sale and Servicing Agreement or, if not defined
therein, in the Indenture.
(b) All terms defined in this Agreement shall have the defined
meanings when used in any certificate or other document made or delivered
pursuant hereto unless otherwise defined therein.
(c) As used in this Agreement and in any certificate or other document
made or delivered pursuant hereto or thereto, accounting terms not defined in
this Agreement or in any such certificate or other document, and accounting
terms partly defined in this Agreement or in any such certificate or other
document to the extent not defined, shall have the respective meanings given to
them under generally accepted accounting principles as in effect on the date of
this Agreement or any such certificate or other document, as applicable. To the
extent that the definitions of accounting terms in this Agreement or in any such
certificate or other document are inconsistent with the meanings of such terms
under generally accepted accounting principles, the definitions contained in
this Agreement or in any such certificate or other document shall control.
(d) The words "hereof," "herein," "hereunder" and words of similar
import when used in this Agreement shall refer to this Agreement as a whole and
not to any particular provision of this Agreement; Section and Exhibit
references contained in this Agreement are references to Sections and Exhibits
in or to this Agreement unless otherwise specified; and the term "including"
shall mean "including without limitation."
(e) The definitions contained in this Agreement are applicable to the
singular as well as the plural forms of such terms and to the masculine as well
as to the feminine and neuter genders of such terms.
ARTICLE II
ORGANIZATION
SECTION 2.1 NAME. There is hereby formed a trust to be known as "The
Money Store Auto Trust 1997-4", in which name the Owner Trustee may conduct the
business of the Trust, make and execute contracts and other instruments on
behalf of the Trust and xxx and be sued.
SECTION 2.2 OFFICE. The office of the Trust shall be in care of the
Owner Trustee at the Corporate Trust Office or at such other address as the
Owner Trustee may designate by written notice to the Certificateholders, the
Security Insurer and the Depositor.
SECTION 2.3 PURPOSES AND POWERS. (a) The purpose of the Trust is, and
the Trust shall have the power and authority, to engage in the following
activities:
(i) to issue the Notes pursuant to the Indenture and
the Trust Certificates pursuant to this Agreement, and to
sell the Notes;
(ii) with the proceeds of the sale of the Notes to fund the
Pre-Funding Account and the Capitalized Interest Account and to pay the
organizational, start-up and transactional expenses of the Trust and to
pay the balance to the Depositor pursuant to the Sale and Servicing
Agreement;
(iii) to acquire, receive and accept from time to time the
Owner Trust Estate and to assign, grant, transfer, pledge, mortgage and
convey the Trust Estate (other than the Certificate Distribution
Account) to the Indenture Collateral Agent pursuant to the Indenture
for the benefit of the Security Insurer and the Trustee on behalf of
the Noteholders, and to hold, manage and distribute to the
Certificateholders and the Seller pursuant to the terms of the Sale and
Servicing Agreement any portion of the Trust Estate released from the
Lien of, and remitted to the Trust pursuant to, the Indenture;
(iv) to enter into and perform its obligations under the Basic
Documents to which it is a party;
(v) 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
(vi) subject to compliance with the Basic Documents, to engage
in such other activities as may be required in connection with
conservation of the Owner Trust Estate and the making of distributions
to the Certificateholders and the Noteholders.
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 Basic
Documents.
SECTION 2.4. APPOINTMENT OF OWNER TRUSTEE. The Depositor hereby
appoints the Owner Trustee as trustee of the Trust effective as of the date
hereof, to have all the rights, powers and duties set forth herein.
SECTION 2.5. INITIAL CAPITAL CONTRIBUTION OF TRUST ESTATE. The
Depositor hereby sells, assigns, transfers, conveys and sets over to the Owner
Trustee, as of the date hereof, the sum of $1. The Owner Trustee hereby
acknowledges receipt in trust from the Depositor, as of the date hereof, of the
foregoing contribution, which shall constitute the initial Owner Trust Estate
and shall be deposited in the Certificate Distribution Account. The Depositor
shall pay organizational expenses of the Trust as they may arise.
SECTION 2.6. DECLARATION OF TRUST. The Owner Trustee hereby declares
that it will hold the Owner Trust Estate in trust upon and subject to the
conditions set forth herein for the use and benefit of the Certificateholders,
subject to the obligations of the Trust under the Basic Documents. It is the
intention of the parties hereto that the Trust constitute a business trust under
the Business Trust Statute and that this Agreement constitute the governing
instrument of such business trust. It is the intention of the parties hereto
that, solely for income and franchise tax purposes, the Trust shall be treated
as a partnership. 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
duties set forth herein and to the extent not inconsistent herewith, in the
Business Trust Statute with respect to accomplishing the purposes of the Trust.
The Owner Trustee shall file the Certificate of Trust with the Secretary of
State.
SECTION 2.7. TRANSFER OF INTEREST TO THE HOLDER OF THE GP INTEREST;
LIABILITY OF THE HOLDER OF THE GP INTEREST. (a) TMS Auto Holdings, Inc., as
holder of no less than a 1% Ownership Percentage in the Trust (the "GP
Interest"), 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. The Holder of the GP
Interest shall also be liable directly to and will indemnify the injured party
for all losses, claims, damages, liabilities and expenses of the Trust
(including Expenses, to the extent not paid out of the Owner Trust Estate) to
the extent that the Holder of the GP Interest would be liable if the Trust were
a partnership under the Delaware Revised Uniform Limited Partnership Act in
which the Holder of the GP Interest were a general partner; PROVIDED, HOWEVER,
that the Holder of the GP Interest shall not be liable for any losses incurred
by a Certificateholder in the capacity of an investor in the Trust Certificates
or a Noteholder in the capacity of an investor in the Notes. In addition, any
third party creditors of the Trust (other than in connection with the
obligations described in the preceding sentence for which the Holder of the GP
Interest shall not be liable) shall be deemed third party beneficiaries of this
paragraph. The obligations of the Holder of the GP Interest under this paragraph
shall be evidenced by the Trust Certificates described in Section 3.11, which
for purposes of the Business Trust Statute shall be deemed to be a separate
class of Trust Certificates from all other Trust Certificates issued by the
Trust. At no time shall the Holder of the GP Interest own 100% Ownership
Percentage of the Certificates.
(b) No holder of a Certificate, other than to the extent set forth in
clause (a), shall have any personal liability for any liability or obligation of
the Trust.
SECTION 2.8. TITLE TO TRUST PROPERTY. (a) Legal title to all the Owner
Trust Estate shall be vested at all times in the Trust as a separate legal
entity except where applicable law in any jurisdiction requires title to any
part of the Owner Trust Estate to be vested in a trustee or trustees, in which
case title shall be deemed to be vested in the Owner Trustee, a co-trustee
and/or a separate trustee, as the case may be.
(b) The Certificateholders shall not have legal title to any part of
the Owner Trust Estate. The Certificateholders shall be entitled to receive
distributions with respect to their undivided Ownership Percentage therein only
in accordance with Articles V and IX. No transfer, by operation of law or
otherwise, of any right, title or interest by any Certificateholder of its
ownership interest in the Owner Trust Estate shall operate to terminate this
Agreement or the trusts hereunder or entitle any transferee to an accounting or
to the transfer to it of legal title to any part of the Owner Trust Estate.
SECTION 2.9. SITUS OF TRUST. The Trust will be located and
administered in the State of Delaware. All bank accounts maintained by the Owner
Trustee on behalf of the Trust shall be located in the State of Delaware or the
State of New York. Payments will be received by the Trust only in Delaware or
New York and payments will be made by the Trust only from Delaware or New York.
The Trust shall not have any employees in any state other than Delaware;
provided however, that nothing herein shall restrict or prohibit the Owner
Trustee, in its individual capacity, the Servicer or any agent of the Trust from
having employees within or without the State of Delaware. The only office of the
Trust will be at the Corporate Trust Office in Delaware.
SECTION 2.10. REPRESENTATIONS AND WARRANTIES OF THE DEPOSITOR. The
Depositor makes the following representations and warranties on which the Owner
Trustee relies in accepting the Owner Trust Estate in trust and issuing the
Certificates and upon which the Security Insurer relies in issuing the Note
Policy.
(a) ORGANIZATION AND GOOD STANDING. The Depositor is duly
organized and validly existing as a Delaware corporation with power and
authority to own its properties and to conduct its business as such
properties are currently owned and such business is presently conducted
and is proposed to be conducted pursuant to this
Agreement and the Basic Documents.
(b) DUE QUALIFICATION. It is duly qualified to do business as
a foreign corporation in good standing, and has obtained all necessary
licenses and approvals, in all jurisdictions in which the ownership or
lease of its property, the conduct of its business and the performance
of its obligations under this Agreement and the Basic Documents
requires such qualification.
(c) POWER AND AUTHORITY. The Depositor has the corporate power
and authority to execute and deliver this Agreement and to carry out
its terms; the Depositor has full power and authority to sell and
assign the property to be sold and assigned to and deposited with the
Trust and the Depositor has duly authorized such sale and assignment
and deposit to the Trust by all necessary corporate action; and the
execution, delivery and performance of this Agreement has been duly
authorized by the Depositor by all necessary corporate action.
(d) NO CONSENT REQUIRED. No consent, license, approval or
authorization or registration or declaration with, any Person or with
any governmental authority, bureau or agency is required in connection
with the execution, delivery or performance of this Agreement and the
Basic Documents, except for such as have been obtained, effected or
made.
(e) NO VIOLATION. The consummation of the transactions
contemplated by this Agreement and the fulfillment of the terms hereof
do not conflict with, result in any breach of any of the terms and
provisions of, or constitute (with or without notice or lapse of time)
a default under, the certificate of incorporation or by-laws of the
Depositor, or any material indenture, agreement or other instrument to
which the Depositor is a party or by which it is bound; nor result in
the creation or imposition of any Lien upon any of its properties
pursuant to the terms of any such indenture, agreement or other
instrument (other than pursuant to the Basic Documents); nor violate
any law or, to the best of the Depositor's knowledge, any order, rule
or regulation applicable to the Depositor of any court or of any
Federal or state regulatory body, administrative agency or other
governmental instrumentality having jurisdiction over the Depositor or
its properties.
(f) NO PROCEEDINGS. There are no proceedings or investigations
pending or, to its knowledge threatened against it before any court,
regulatory body, administrative agency or other tribunal or
governmental instrumentality having jurisdiction over it or its
properties (A) asserting the invalidity of this Agreement or any of the
Basic Documents, (B) seeking to prevent the issuance of the
Certificates or the Notes or the consummation of any of the
transactions contemplated by this Agreement or any of the Basic
Documents, (C) seeking any determination or ruling that might
materially and adversely affect its performance of its obligations
under, or the validity or enforceability of, this Agreement or any of
the Basic Documents, or (D) seeking to adversely affect the federal
income tax or other federal, state or local tax attributes of the
Certificates.
(g) DEMAND NOTE. It has been duly capitalized by the delivery
of a demand note (the "Demand Note") from the Representative in the
amount of $1,000,000 which Demand Note has not been canceled, waived or
terminated. The proceeds of such Demand Note have not been used and
will not be used to pay (i) any of the expenses of the Depositor in
connection with the transactions contemplated by the Basic Documents or
(ii) the purchase price for the Certificates purchased pursuant to
Section 2.3. Such Demand Note is enforceable against the Depositor,
subject to its terms, and subject to applicable bankruptcy, insolvency,
moratorium, fraudulent conveyance, reorganization and similar laws now
or hereafter in effect relating to creditors' rights generally or the
rights of creditors of banks the deposit accounts of which are insured
by the Federal Deposit Insurance Corporation and subject to general
principles of equity (whether applied in a proceeding at law or in
equity).
SECTION 2.11. COVENANTS OF THE HOLDER OF THE GP INTEREST The Holder of
the GP Interest agrees and covenants for the benefit of each Owner, the Security
Insurer and the Owner Trustee, during the term of this Agreement, and to the
fullest extent permitted by applicable law, that:
(a) it shall not assign, sell, convey, pledge, transfer, reconvey,
cancel, forgive, compromise or otherwise dispose of the Demand Note held by it,
in whole or in part;
(b) it shall not sell, assign, transfer, give or encumber, by
operation of law or otherwise, in whole or in part, the interest evidenced by
its certificates acquired pursuant to Section 3.12 without the consent of the
Security Insurer;
(c) other than pursuant to Section 2.7 or in connection with routine
administrative matters, it shall not create, incur or suffer to exist any
indebtedness or engage in any business, except, in each case, as permitted by
its certificate of incorporation and the Basic Documents;
(d) it shall not, for any reason, institute proceedings for the Trust
to be adjudicated a bankrupt or insolvent, or consent to the institution of
bankruptcy or insolvency proceedings against the Trust, or file a petition
seeking or consenting to reorganization or relief under any applicable federal
or state law relating to the bankruptcy of the Trust, or consent to the
appointment of a receiver, liquidator, assignee, trustee, sequestrator (or other
similar official) of the Trust or a substantial part of the property of the
Trust or cause or permit the Trust to make any assignment for the benefit of
creditors, or admit in writing the inability of the Trust to pay its debts
generally as they become due, or declare or effect a moratorium on the debt of
the Trust or take any action in furtherance of any such action;
(e) it shall obtain from each counterparty to each Basic Document to
which it or the Trust is a party and each other agreement entered into on or
after the date hereof to which it or the Trust is a party, an agreement by each
such counterparty that prior to the occurrence of the event specified in Section
9.1(e) such counterparty shall not institute against, or join any other Person
in instituting against, it or the Trust, any bankruptcy, reorganization,
arrangement, insolvency or liquidation proceedings or other similar proceedings
under the laws of the United States or any state of the United States;
(f) it shall not, for any reason, withdraw or attempt to withdraw from
this Agreement, dissolve, institute proceedings for it to be adjudicated a
bankrupt or insolvent, or consent to the institution of bankruptcy or insolvency
proceedings against it, or file a petition seeking or consenting to
reorganization or relief under any applicable federal or state law relating to
bankruptcy, or consent to the appointment of a receiver, liquidator, assignee,
trustee, sequestrator (or other similar official) of it or a substantial part of
its property, or make any assignment for the benefit of creditors, or admit in
writing its inability to pay its debts generally as they become due, or declare
or effect a moratorium on its debt or take any action in furtherance of any such
action; and
(g) it shall not (i) assign, sell, convey, pledge, transfer, reconvey,
cancel, forgive, compromise or otherwise dispose of the Demand Note held by it,
in whole or in part, or (ii) make any distribution other than to the Trust or
unless the aggregate net worth of the Holder of the GP Interest following such
distribution shall be at least equal to the Minimum Net Worth unless the Holder
of the GP Interest shall deliver to the Owner Trustee, the Trustee and the
Security Insurer an Opinion of Counsel to the effect that the failure to
maintain such Minimum Net Worth shall not cause the Trust to be an association
taxable as a corporation or a publicly traded partnership.
SECTION 2.12. COVENANTS OF THE CERTIFICATEHOLDERS. Each
Certificateholder by becoming a holder of a Certificate agrees:
(a) to be bound by the terms and conditions of the Certificates of
which such Certificateholder is the beneficial owner and of this 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,
the Owner Trustee, the Security Insurer and all other Certificateholders present
and future;
(b) to hereby appoint the Holder of the GP Interest as such
Certificateholder's agent and attorney-in-fact to sign any federal income tax
information return filed on behalf of the Trust and agree that, if requested by
the Trust, it will sign such federal income tax information return in its
capacity as holder of an interest in the Trust. Each Certificateholder also
hereby agrees that in its tax returns it will not take any position inconsistent
with those taken in any tax returns filed by the Trust;
(c) if such Certificateholder is other than an individual or other
entity holding its Certificate through a broker who reports securities sales on
Form 1099-B, to notify the Owner Trustee of any transfer by it of a Certificate
in a taxable sale or exchange, within 30 days of the date of the transfer; and
(d) until the completion of the events specified in Section 9.1(e),
not to, for any reason, institute proceedings for the Trust or the Holder of the
GP Interest to be adjudicated a bankrupt or insolvent, or consent to the
institution of bankruptcy or insolvency proceedings against the Trust, or file a
petition seeking or consenting to reorganization or relief under any applicable
federal or state law relating to bankruptcy, or consent to the appointment of a
receiver, liquidator, assignee, trustee, sequestrator (or other similar
official) of the Trust or a substantial part of its property, or cause or permit
the Trust to make any assignment for the benefit of its creditors, or admit in
writing its inability to pay its debts generally as they become due, or declare
or effect a moratorium on its debt or take any action in furtherance of any such
action.
SECTION 2.13. VOTING INTEREST. On the Closing Date First Union Bank of
Delaware (the "Holder of the Voting Interest") shall acquire a 100% voting
interest in the Trust (the "Voting Interest") and shall be deemed to have agreed
to be bound by the terms and conditions set forth herein concerning the Voting
Interest. Except as otherwise provided herein, the Holder of the Voting Interest
shall have the sole power and authority to approve or disapprove actions
requiring the approval or disapproval of Certificateholders in any of the Basic
Documents. Except as otherwise provided herein, any action requiring the
consent, approval or vote of the Certificateholders under any of the Basic
Documents shall be taken only upon the written consent, approval or vote of the
Holder of the Voting Interest. In exercising such power and authority to give or
withhold such consent, approval or vote, the Holder of the Voting Interest shall
act only in accordance with and upon receipt of written instructions delivered
to it by the Trustee (on which the Holder of the Voting Interest shall be fully
protected in relying). Notwithstanding any provision herein or in any other
document to the contrary, the Holder of the Voting Interest shall have no
obligation other than to exercise such power and authority in accordance with
such written instructions; provided, however, that no action may be taken that
would increase or reduce in any manner the amount of, or accelerate or delay the
timing of, collections of payments on Loans or distributions required to be made
for the benefit of Certificateholders, or would adversely affect the Federal or
state tax consequences to the Certificateholders, without the consent of all
Certificateholders affected thereby. Notwithstanding any provision herein or in
any other document to the contrary, the Holder of the Voting Interest shall not
have any personal liability for any liability or obligation of the Trust, any
action taken or omitted pursuant to any written instructions of the Trustee, or
otherwise relating to the Trust or its serving as the Holder of the Voting
Interest. The Holder of the Voting Interest may not sell, transfer, assign,
pledge or otherwise convey, directly or indirectly, all or any part of the
Voting Interest without the prior written consent of the Holder of the GP
Interest and the Security Insurer. The Holder of the Voting Interest shall have
no right to receive any amounts hereunder or under any other Basic Document or
any other economic rights as a beneficial owner of the Trust and, except as
otherwise expressly set forth herein, the Voting Interest shall not be deemed a
Certificateholder and the Holder of the Voting Interest shall not be deemed a
Certificateholder (except as to benefits afforded Certificateholders). In no
event shall the Owner Trustee owe any fiduciary duties to the Holder of the
Voting Interest, nor shall the Owner Trustee be liable to the Certificateholders
for any action or omission taken or omitted to be taken at the direction of the
Holder of the Voting Interest. For purposes of the Business Trust Statute, the
Voting Interest shall be deemed a separate class of beneficial ownership
interest in the Trust from all other beneficial ownership interests in the
Trust, and the Holder of the Voting Interest, as such, shall be deemed a
separate class of beneficial owner of the Trust from all other beneficial owners
of the Trust. The Voting Interest shall not be represented by a certificate.
SECTION 2.14. FEDERAL INCOME TAX ALLOCATIONS. 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 pro rata to the Certificateholders based on their Ownership
Percentage. The Holder of the GP Interest is authorized to modify the
allocations in this paragraph if necessary or appropriate, in its sole
discretion, for the allocations to fairly reflect the economic income, gain or
loss to the Holder of the GP Interest, the Certificateholders, or as otherwise
required by the Code.
ARTICLE III
TRUST CERTIFICATES AND TRANSFER OF INTERESTS
SECTION 3.1. INITIAL OWNERSHIP. Upon the formation of the Trust by the
contribution by the Depositor pursuant to Section 2.5 and until the issuance of
the Trust Certificates, the Depositor shall be the sole beneficiary of the
Trust.
SECTION 3.2. THE TRUST CERTIFICATES. The Trust Certificates shall be
issued in denominations corresponding to an Ownership Percentage of 1%. The
Trust Certificates shall be executed on behalf of the Trust by manual or
facsimile signature of an authorized officer of the Owner Trustee, and the Owner
Trustee shall have the power and authority and it is hereby authorized and
empowered, in the name and on behalf of the Trust to authorize, execute, issue
and deliver Trust Certificates, the GP Interest and the Voting Interest. Trust
Certificates bearing the manual or facsimile signatures of individuals who were,
at the time when such signatures shall have been affixed, authorized to sign on
behalf of the Trust, shall be validly issued and entitled to the benefit of this
Agreement, notwithstanding that such individuals or any of them shall have
ceased to be so authorized prior to the authentication and delivery of such
Trust Certificates or did not hold such offices at the date of authentication
and delivery of such Trust Certificates. A transferee of a Trust Certificate
shall become a Certificateholder, and shall be entitled to the rights and
subject to the obligations of a Certificateholder hereunder, upon due
registration of such Trust Certificate in such transferee's name pursuant to
Section 3.4.
SECTION 3.3. AUTHENTICATION OF TRUST CERTIFICATES. Concurrently with
the initial sale of the Receivables to the Trust pursuant to the Sale and
Servicing Agreement, the Owner Trustee in the name and on behalf of the Trust
shall cause, and shall have power and authority and is hereby authorized and
empowered to cause, the GP Interest (which shall include a 1% Ownership
Percentage) to be authenticated and issued to, and registered on the Certificate
Register in the name of, the Holder of the GP Interest and the balance of the
Trust Certificates to be executed and signed by an Authorized Officer and
authenticated, issued and delivered to and in the names of the following: (i)
98% of the Ownership Percentage to TMS Auto Holdings, Inc. and (ii) 1% of the
Ownership Percentage to The Money Store Inc. The Owner Trustee shall cause and
shall have the power and authority and is hereby authorized and empowered to
cause the uncertificated Voting Interest to be issued to, and registered on the
Certificate Register in the name of, the Holder of the Voting Interest. No Trust
Certificate shall entitle its holder to any benefit under this Agreement, or
shall be valid for any purpose, unless there shall appear on such Trust
Certificate a certificate of authentication substantially in the form set forth
in Exhibit A, executed by the Owner Trustee or Bankers Trust Company as the
Owner Trustee's authentication agent, by manual signature; such authentication
shall constitute conclusive evidence that such Trust Certificate shall have been
duly authenticated and delivered hereunder. All Trust Certificates shall be
dated the date of their authentication.
SECTION 3.4. REGISTRATION OF TRANSFER AND EXCHANGE OF TRUST
CERTIFICATES. The Certificate Registrar shall keep or cause to be kept, at the
office or agency maintained pursuant to Section 3.8, a Certificate Register in
which, subject to such reasonable regulations as it may prescribe, the Owner
Trustee shall provide for the registration of Trust Certificates and of
transfers and exchanges of Trust Certificates as herein provided. Bankers Trust
Company shall be the initial Certificate Registrar.
Upon surrender for registration of transfer of any Trust Certificate
at the office or agency maintained pursuant to Section 3.8, and upon
satisfaction of the conditions set forth below, the Owner Trustee shall execute,
authenticate and deliver (or shall cause Bankers Trust Company as its
authenticating agent to authenticate and deliver), in the name of the designated
transferee or transferees, one or more new Trust Certificates of a like
Ownership Percentage dated the date of authentication by the Owner Trustee or
any authenticating agent. At the option of a Holder, Trust Certificates may be
exchanged for other Trust Certificates of a like Ownership Percentage aggregate
amount upon surrender of the Trust Certificates to be exchanged at the office or
agency maintained pursuant to Section 3.8.
Every Trust Certificate presented or surrendered for registration of
transfer or exchange shall be accompanied by (i) in the case of a transfer of a
Certificate, an executed Investment Letter referred to in Section 3.10 or an
opinion of counsel (furnished at the cost of the transferee or transferor)
satisfactory to the Owner Trustee to the effect that the transfer of such
Certificate is exempt from the registration requirements of the Securities Act
and would not result in adverse tax consequences to the Trust, the Noteholders
or the Certificateholders and (ii) a written instrument of transfer in form
satisfactory to the Owner Trustee and the Certificate Registrar duly executed by
the Certificateholder or his attorney duly authorized in writing, with such
signature guaranteed by an "eligible guarantor institution" meeting the
requirements of the Certificate Registrar, which requirements include membership
or participation in the Securities Transfer Agent's Medallion Program ("STAMP")
or such other "signature guarantee program" as may be determined by the
Certificate Registrar in addition to, or in substitution for, STAMP, all in
accordance with the Exchange Act. Each Trust Certificate surrendered for
registration of transfer or exchange shall be canceled and subsequently disposed
of by the Owner Trustee in accordance with its customary practice.
No service charge shall be made for any registration of transfer or
exchange of Trust Certificates, but the Owner Trustee or the Certificate
Registrar may but shall not be obligated to require payment of a sum sufficient
to cover any tax or governmental charge that may be imposed in connection with
any transfer or exchange of Trust Certificates.
SECTION 3.5. MUTILATED, DESTROYED, LOST OR STOLEN TRUST CERTIFICATES.
If (a) any mutilated Trust Certificate shall be surrendered to the Certificate
Registrar, or if the Certificate Registrar shall receive evidence to its
satisfaction of the destruction, loss or theft of any Trust Certificate and (b)
there shall be delivered to the Certificate Registrar, the Owner Trustee and
(unless an Insurer Default shall have occurred and be continuing) the Security
Insurer, such security or indemnity as may be required by them to save each of
them harmless, then in the absence of notice that such Trust Certificate shall
have been acquired by a bona fide purchaser, the Owner Trustee on behalf of the
Trust shall execute and the Owner Trustee, or Bankers Trust Company, as the
Owner Trustee's authenticating agent, shall authenticate and deliver, in
exchange for or in lieu of any such mutilated, destroyed, lost or stolen Trust
Certificate, a new Trust Certificate of like class, tenor and Ownership
Percentage. In connection with the issuance of any new Trust Certificate under
this Section, the Owner Trustee or the Certificate Registrar may require the
payment of a sum sufficient to cover any tax or other governmental charge that
may be imposed in connection therewith. Any duplicate Trust Certificate issued
pursuant to this Section shall constitute conclusive evidence of an Ownership
Percentage in the Trust, as if originally issued, whether or not the lost,
stolen or destroyed Trust Certificate shall be found at any time.
SECTION 3.6. PERSONS DEEMED CERTIFICATEHOLDERS. Every person by virtue
of becoming a Certificateholder in accordance with this Agreement shall be
deemed to be bound by the terms of this Agreement. Prior to due presentation of
a Trust Certificate for registration of transfer, the Owner Trustee, the
Certificate Registrar and the Security Insurer and any agent of the Owner
Trustee, the Certificate Registrar and the Security Insurer, may treat the
Person in whose name any Trust Certificate shall be registered in the
Certificate Register as the Owner of such Trust Certificate for the purpose of
receiving distributions pursuant to Section 5.2 and for all other purposes
whatsoever, and none of the Owner Trustee, the Certificate Registrar or the
Security Insurer nor any agent of the Owner Trustee, the Certificate Registrar
or the Security Insurer shall be bound by any notice to the contrary.
SECTION 3.7. ACCESS TO LIST OF CERTIFICATEHOLDERS' NAMES AND
ADDRESSES. The Owner Trustee shall furnish or cause to be furnished to the
Servicer, the Depositor or (unless an Insurer Default shall have occurred and be
continuing) the Security Insurer, the Representative and the Holder of the GP
Interest, within 15 days after receipt by the Owner Trustee of a request
therefor from the Servicer, the Representative or the Holder of the GP Interest
in writing, a list, of the names and addresses of the Certificateholders as of
the most recent Record Date. If three or more Holders of Trust Certificates or
one or more Holders of Trust Certificates evidencing not less than 25% of the
Ownership Percentage apply in writing to the Owner Trustee, and such application
states that the applicants desire to communicate with other Certificateholders
with respect to their rights under this Agreement or under the Trust
Certificates and such application is accompanied by a copy of the communication
that such applicants propose to transmit, then the Owner Trustee shall, within
five Business Days after the receipt of such application, afford such applicants
access during normal business hours to the current list of Certificateholders.
Each Holder, by receiving and holding a Trust Certificate, shall be deemed to
have agreed not to hold any of the Depositor, the Servicer the Owner Trustee or
the Security Insurer or any agent thereof or the Representative accountable by
reason of the disclosure of its name and address, regardless of the source from
which such information was derived.
SECTION 3.8. MAINTENANCE OF OFFICE OR AGENCY. The Owner Trustee shall
maintain in New York, an office or offices or agency or agencies where Trust
Certificates may be surrendered for registration of transfer or exchange and
where notices and demands to or upon the Owner Trustee in respect of the Trust
Certificates and the Basic Documents may be served. The Owner Trustee initially
designates Bankers Trust Company, 0 Xxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, as
its principal corporate trust office for such purposes. The Owner Trustee shall
give prompt written notice to the Depositor, the Certificateholders and (unless
an Insurer Default shall have occurred and be continuing) the Security Insurer
of any change in the location of the Certificate Register or any such office or
agency.
SECTION 3.9. APPOINTMENT OF CERTIFICATE PAYING Agent. The Certificate
Paying Agent shall make distributions to Certificateholders from the Certificate
Distribution Account pursuant to Section 5.2 and shall report the amounts of
such distributions to the Owner Trustee. Any Certificate Paying Agent shall have
the revocable power to withdraw funds from the Certificate Distribution Account
for the purpose of making the distributions referred to above. The Owner Trustee
may revoke such power and remove the Certificate Paying Agent if the Owner
Trustee determines in its sole discretion that the Certificate Paying Agent
shall have failed to perform its obligations under this Agreement in any
material respect. The Certificate Paying Agent shall initially be Bankers Trust
Company, and any co-Certificate Paying Agent chosen by the Owner Trustee, and
acceptable to the Servicer and the Security Insurer. The Certificate Paying
Agent shall be permitted to resign upon 30 days' written notice to the Owner
Trustee and the Servicer. In the event that the Owner Trustee shall no longer be
the Certificate Paying Agent, the Owner Trustee shall appoint a successor to act
as Certificate Paying Agent (which shall be a bank or trust company). The Owner
Trustee shall cause such successor Certificate Paying Agent or any additional
Certificate Paying Agent appointed by the Owner Trustee to execute and deliver
to the Owner Trustee and (unless an Insurer Default shall have occurred and be
continuing) the Security Insurer an instrument in which such successor
Certificate Paying Agent or additional Certificate Paying Agent shall agree with
the Owner Trustee that as Certificate Paying Agent, such successor Certificate
Paying Agent or additional Certificate Paying Agent will hold all sums, if any,
held by it for payment to the Certificateholders in trust for the benefit of the
Certificateholders (and the Security Insurer) entitled thereto until such sums
shall be paid to such Certificateholders or the Security Insurer. The
Certificate Paying Agent shall return all unclaimed funds to the Owner Trustee
and upon removal of a Certificate Paying Agent such Certificate Paying Agent
shall also return all funds in its possession to the Owner Trustee. The
provisions of Sections 7.1, 7.3, 7.4 and 8.1 shall apply to the Owner Trustee
also in its role as Certificate Paying Agent, for so long as the Owner Trustee
shall act as Certificate Paying Agent and, to the extent applicable, to any
other Certificate Paying Agent appointed hereunder. Any reference in this
Agreement to the Certificate Paying Agent shall include any co-paying agent
unless the context requires otherwise.
SECTION 3.10. TRUST CERTIFICATE TRANSFER RESTRICTIONS. (a) Except for
the initial issuance of Trust Certificates to TMS Auto Holdings, Inc. and The
Money Store Inc., the Trust Certificates may not be offered or sold except to
institutional "accredited investors" (as defined in Rule 501(a)(1)-(3) 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. No offer, sale, transfer or other disposition (including
pledge) of Trust Certificates shall be made to any Person unless such Person
executes and delivers to the Owner Trustee and the Holder of the GP Interest an
Investment Letter substantially in the form set forth as Exhibit C hereto.
(b) No offer, sale, transfer or other disposition (including pledge)
of the Trust Certificates shall be effective to any Person to which is, or is
purchasing for, or on behalf of, (1) 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 any such plan's arrangements or account's investment in
any such entity.
(c) Each Certificateholder must be a United States person as defined
in Section 7701(a)(30) of the Code.
(d) Each Trust Certificate will bear a legend substantially to the
following effect.
THIS TRUST CERTIFICATE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933,
AS AMENDED (THE "ACT"). THE HOLDER HEREOF, BY PURCHASING THIS TRUST CERTIFICATE,
AGREES THAT THIS TRUST CERTIFICATE MAY BE RESOLD, PLEDGED OR OTHERWISE
TRANSFERRED ONLY IN ACCORDANCE WITH ANY APPLICABLE STATE SECURITIES LAWS AND (1)
TO A PERSON WHO (A) HAS FURNISHED TO THE OWNER TRUSTEE AND HOLDER OF THE GP
INTEREST AN INVESTMENT LETTER IN THE FORM REQUIRED BY THE TRUST AGREEMENT TO THE
EFFECT THAT SUCH PURCHASER IS AN INSTITUTIONAL ACCREDITED INVESTOR WITHIN THE
MEANING OF RULE 501(A)(1)-(3) UNDER THE ACT OR (B) AN OPINION OF COUNSEL
SATISFACTORY TO THE OWNER TRUSTEE OR (2) PURSUANT TO AN EFFECTIVE REGISTRATION
STATEMENT UNDER THE ACT.
THIS TRUST 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 ARRANGEMENTS OR ACCOUNT'S INVESTMENT IN SUCH ENTITIES. FURTHER, THIS
TRUST 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.
SECTION 3.11. DISPOSITION BY THE HOLDER OF THE GP INTEREST. On and
after the Closing Date the Holder of the GP Interest shall retain beneficial and
record ownership of Trust Certificates representing at least 1% of the Ownership
Percentage. Any attempted transfer of any Trust Certificate that would reduce
such interest of the Holder of the GP Interest below 1% of the Ownership
Percentage shall be void. The Trust shall cause the Trust Certificate
representing the 1% GP Interest issued to the Holder of the GP Interest to
contain a legend stating "THIS CERTIFICATE IS NOT TRANSFERABLE".
SECTION 3.12. [RESERVED]
SECTION 3.13. [RESERVED]
SECTION 3.14. [RESERVED]
SECTION 3.15. [RESERVED]
ARTICLE IV
ACTIONS BY OWNER TRUSTEE
SECTION 4.1. PRIOR NOTICE TO CERTIFICATEHOLDERS WITH RESPECT TO
CERTAIN MATTERS. With respect to the following matters, the Owner Trustee shall
not take action unless at least 30 days before the taking of such action, the
Owner Trustee shall have notified the Certificateholders, the Security Insurer
and the Holder of the Voting Interest in writing of the proposed action and
neither the Holder of the Voting Interest nor the Security Insurer shall have
notified the Owner Trustee in writing prior to the 30th day after such notice is
given that it has withheld consent or provided alternative direction (provided
that no consent or direction of the Holder of the Voting Interest pursuant to
this Section 4.1 shall be effective without the consent of the Security
Insurer):
(a) the initiation of any material claim or lawsuit by the
Trust except claims or lawsuits brought in connection with the
collection of the Loans and the compromise of any material action,
claim or lawsuit brought by or against the Trust (except with respect
to the aforementioned claims or lawsuits for collection of the Loans);
(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 or unless such amendment would not
materially and adversely affect the interests of the
Certificateholders);
(c) the amendment of the Indenture by a supplemental indenture
in circumstances where the consent of any Noteholder or the Security
Insurer is required;
(d) the amendment of the Indenture by a supplemental indenture
in circumstances where the consent of any Noteholder or the Security
Insurer is not required and such amendment materially adversely affects
the interest of the Certificateholders; or
(e) the amendment, change or modification of the Sale and
Servicing Agreement, except to cure any ambiguity or defect or to amend
or supplement any provision in a manner that would not materially
adversely affect the interests of the Certificateholders;
(f) the consent to the calling, or waiver of any
default of any Basic Document;
(g) the consent to the assignment by the Indenture Trustee or
Servicer of their respective obligations under any Basic Document;
(h) except as provided in this Agreement dissolve, terminate
or liquidate the Trust in whole or in part;
(i) merge or consolidate the Trust with or into any other
entity, or convey or transfer all or substantially all of the Trust's
assets to any other entity;
(j) cause the Trust to incur, assume or guaranty any
indebtedness other than as set forth in this Agreement or the other
Basic Documents;
(k) perform any act that conflicts with any other
Basic Document;
(l) perform any act which would make it impossible to carry
on the ordinary business of the Trust as described in this Agreement;
(m) confess a judgment against the Trust;
(n) cause the Trust to lend any funds to any entity;
(o) change the Trust's purpose and powers from those
enumerated in this Agreement; or
(p) possess Trust assets or assign the Trust's right to
property for other than a Trust purpose.
The Owner Trustee shall notify the Certificateholders and the Security Insurer
in writing of any appointment of a successor Note Registrar, Certificate Paying
Agent or Certificate Registrar within five Business Days thereof.
SECTION 4.2. ACTION BY HOLDER OF THE VOTING INTEREST WITH RESPECT TO
CERTAIN MATTERS. The Owner Trustee shall not have the power, except upon the
direction of the Security Insurer in accordance with the Basic Documents and the
Holder of the Voting Interest, to (a) remove the Servicer under the Sale and
Servicing Agreement pursuant to Section 8.1 thereof or (b) except as expressly
provided in the Basic Documents, sell the Receivables after the termination of
the Indenture. The Owner Trustee shall take the actions referred to in the
preceding sentence only upon written instructions signed by the
Certificateholders or the Security Insurer, as the case may be, and the
furnishing of indemnification satisfactory to the Owner Trustee by the
Certificateholders.
SECTION 4.3. ACTION BY HOLDER OF THE VOTING INTEREST WITH RESPECT TO
BANKRUPTCY. The Owner Trustee shall not have the power to, and shall not,
commence a voluntary proceeding in bankruptcy relating to the Trust without the
prior written consent of the Security Insurer (unless an Insurer Default shall
have occurred and be continuing) and the approval of the Holder of the Voting
Interest and the delivery to the Owner Trustee by the Holder of the Voting
Interest of a certificate certifying that it reasonably believes that the Trust
is insolvent.
SECTION 4.4. RESTRICTIONS ON THE HOLDER OF THE VOTING INTEREST'S
POWER. (a) Any direction of the Holder of the Voting Interest shall be
ineffective if it shall direct the Owner Trustee to take or refrain from taking
any action that would be contrary to any obligation of the Trust or the Owner
Trustee under this Agreement or any of the Basic Documents or would be contrary
to Section 2.3 nor shall the Owner Trustee or the Holder of the Voting Interest
be obligated to determine if the Holder of the Voting Interest's direction
violates this Section 4.4 or to follow any such direction, if given. Further,
any direction of the Holder of the Voting Interest shall be ineffective if it
shall direct the Owner Trustee to take or refrain from taking any action that
would increase or reduce in any manner the amount of, or accelerate or delay the
timing of collections of payments on the Receivables or distributions required
to be made for the benefit of Certificateholders, or would adversely affect the
Federal or state tax consequences to the Certificateholders, without the consent
of all Certificateholders affected thereby.
(b) The Holder of the Voting Interest shall not have any right by
virtue or by availing itself of any provisions of this Agreement to institute
any suit, action, or proceeding in equity or at law upon or under or with
respect to this Agreement or any Basic Document, unless the Holder of the Voting
Interest is the Instructing Party pursuant to Section 6.3 and unless the Holder
of the Voting Interest previously shall have given to the Owner Trustee a
written notice of default and of the continuance thereof, as provided in this
Agreement, or unless Certificateholders evidencing not less than 25% of the
Ownership Percentage shall have made written request upon the Owner Trustee to
institute such action, suit or proceeding in its own name as Owner Trustee under
this Agreement and shall have offered to the Owner Trustee such reasonable
indemnity as it may require against the costs, expenses and liabilities to be
incurred therein or thereby, and the Owner Trustee, for 30 days after its
receipt of such notice, request, and offer of indemnity, shall have neglected or
refused to institute any such action, suit, or proceeding, and during such
30-day period no request or waiver inconsistent with such written request has
been given to the Owner Trustee pursuant to and in compliance with this Section
or Section 6.3; it being understood and intended, and being expressly covenanted
by the Holder of the Voting Interest and each Certificateholder with every other
Certificateholder, the Holder of the Voting Interest and the Owner Trustee, that
no one or more Holders of Certificates shall have any right in any manner
whatever by virtue or by availing itself or themselves of any provisions of this
Agreement to affect, disturb, or prejudice the rights of the Holders of any
other of the Certificates, or to obtain or seek to obtain priority over or
preference to any other such Holder, or to enforce any right under this
Agreement, except in the manner provided in this Agreement and for the equal,
ratable, and common benefit of all Certificateholders. For the protection and
enforcement of the provisions of this Section 4.4, each and every
Certificateholder, the Holder of the Voting Interest and the Owner Trustee shall
be entitled to such relief as can be given either at law or in equity.
SECTION 4.5. CONTROL BY HOLDER OF THE VOTING Interest. Except as
otherwise specifically provided herein, any action that may be taken by the
Certificateholders under this Agreement may be taken by the Holder of the Voting
Interest. Except as otherwise specifically provided herein, any written notice
of the Certificateholders delivered pursuant to this Agreement shall be
effective if signed by holders of Certificates evidencing not less than a
majority of the Ownership Percentage at the time of the delivery of such notice.
SECTION 4.6. RIGHTS OF SECURITY INSURER. Notwithstanding anything to
the contrary in the Basic Documents, without the prior written consent of the
Security Insurer (so long as no Insurer Default shall have occurred and be
continuing), the Owner Trustee shall not (i) remove the Servicer, (ii) initiate
any claim, suit or proceeding by the Trust or compromise any claim, suit or
proceeding brought by or against the Trust, other than with respect to the
enforcement of any Receivable or any rights of the Trust thereunder, (iii)
authorize the merger or consolidation of the Trust with or into any other
business trust or other entity (other than in accordance with Section 3.10 of
the Indenture) or (iv) amend the Certificate of Trust.
ARTICLE V
APPLICATION OF TRUST FUNDS:
CERTAIN DUTIES
SECTION 5.1. ESTABLISHMENT OF CERTIFICATE DISTRIBUTION ACCOUNT. (a)
The Owner Trustee, for the benefit of the Certificateholders and the Security
Insurer, shall establish and maintain in the name of the Trust an Eligible
Deposit Account (the "Certificate Distribution Account"), bearing a designation
clearly indicating that the funds deposited therein are held for the benefit of
the Certificateholders and the Security Insurer.
(b) The Owner Trustee shall possess all right, title and interest in
all funds on deposit from time to time in the Certificate Distribution Account
and in all proceeds thereof. If, at any time, the Certificate Distribution
Account ceases to be an Eligible Deposit Account, the Owner Trustee shall within
five Business Days (or such longer period, not to exceed 30 calendar days, as to
which each Rating Agency and, so long as no Insurer Default shall have occurred
and be continuing, the Security Insurer may consent) establish a new Certificate
Distribution Account as an Eligible Deposit Account and shall transfer any cash
and/or any investments to such new Certificate Distribution Account.
(c) All amounts held in the Certificate Distribution Account shall, to
the extent permitted by applicable laws, rules and regulations, be invested, by
the Owner Trustee at the Servicer's written direction, in Eligible Investments
that mature not later than one Business Day prior to the Distribution Date for
the Monthly Period to which such amounts relate. Investments in Eligible
Investments shall be made in the name of the Trust, and such investments shall
not be sold or disposed of prior to their maturity. Subject to the other
provisions hereof, the Owner Trustee shall have sole control over each such
investment and the income thereon, and any certificate or other instrument
evidencing any such investment, if any, shall be delivered directly to the Owner
Trustee. All Investment Earnings on funds in the Certificate Distribution
Account shall be distributed on the next Distribution Date pursuant to Section
5.6 of the Sale and Servicing Agreement.
SECTION 5.2. APPLICATION OF FUNDS IN CERTIFICATE DISTRIBUTION ACCOUNT.
(a) On each Distribution Date, the Owner Trustee will, based on the information
contained in the Servicer's Certificate delivered on the related Determination
Date pursuant to Section 4.9 of the Sale and Servicing Agreement, distribute pro
rata to Certificateholders based on Ownership Percentage, to the extent of the
funds available, amounts deposited in the Certificate Distribution Account
pursuant to Sections 5.6(b) of the Sale and Servicing Agreement on such
Distribution Date. Notwithstanding any other provision hereof, the
Certificateholders hereby authorize the Trustee on their behalf to remit all
amounts payable to the Certificate Distribution Account pursuant to Section
5.6(b)(vi) of the Sale and Servicing Agreement to the Insurer's Agent for
deposit in the Spread Account up to the amount necessary to cause the Collateral
Amount to equal the Specified Spread Account Requirement and then to the Payment
Provider for payment of the Required Amount on the previous Distribution Date
and to the extent any funds remain, to the Certificateholders. (Capitalized
terms in this Section not defined in this Agreement shall have the meaning as
set forth in the Spread Account and Payment Agreement).
(b) On each Distribution Date, the Owner Trustee shall send to each
Certificateholder the statement provided to the Owner Trustee by the Servicer
pursuant to Section 5.8 of the Sale and Servicing Agreement on such Distribution
Date.
(c) If 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 Owner Trustee 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 from contesting any such tax in appropriate
proceedings, and withholding payment of such tax, if permitted by law, pending
the outcome of such proceedings). The amount of any withholding tax imposed with
respect to a 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-US
Certificateholder), the Owner Trustee may in it sole discretion withhold such
amounts in accordance with this clause (c). In the event that an Owner wishes to
apply for a refund of any such withholding tax, the Owner Trustee shall
reasonably cooperate with such Certificateholder in making such claim so long as
such Certificateholder agrees to reimburse the Owner Trustee for any
out-of-pocket expenses incurred. The Servicer shall facilitate compliance with
this Section 5.2(c) by performance of its duties under the Sale and Servicing
Agreement.
SECTION 5.3. [Reserved]
SECTION 5.4. METHOD OF PAYMENT. Subject to Section 9.1(c),
distributions required to be made to Certificateholders on any Distribution Date
shall be made to each Certificateholder of record on the preceding Record Date
either by wire transfer, in immediately available funds, to the account of such
Holder at a bank or other entity having appropriate facilities therefor, if (i)
such Certificateholder shall have provided to the Certificate Registrar
appropriate written instructions at least five Business Days prior to such
Distribution Date and such Holder's Trust Certificates in the aggregate evidence
a denomination of not less than 20% or (ii) such Certificateholder is the Holder
of the GP Interest, or an Affiliate thereof, or, if not, by check mailed to such
Certificateholder at the address of such holder appearing in the Certificate
Register, Notwithstanding the foregoing, the final distribution in respect of
any Trust Certificate (whether on the Final Scheduled Distribution Date or
otherwise) will be payable only upon presentation and surrender of such Trust
Certificate at the office or agency maintained for that purpose by the Owner
Trustee pursuant to Section 3.8.
SECTION 5.5. NO SEGREGATION OF MONIES; NO INTEREST. Subject to
Sections 5.1 and 5.2, monies received by the Owner Trustee hereunder need not be
segregated in any manner except to the extent required by law and may be
deposited under such general conditions as may be prescribed by law, and the
Owner Trustee shall not be liable for any interest thereon.
SECTION 5.6. ACCOUNTING AND REPORTS TO THE NOTEHOLDERS,
CERTIFICATEHOLDERS, THE INTERNAL REVENUE SERVICE AND OTHERS. Subject to Sections
10.1(b)(iii) and 10.1(c) of the Sale and Servicing Agreement, the Holder of the
GP Interest 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 Schedule K-1) to enable each Certificateholder to prepare its Federal
and state income tax returns, (c) file or cause to be filed such tax returns
relating to the Trust (including a partnership information return, Form 1065),
and direct the Owner Trustee to make such elections as may from time to time be
required or appropriate under any applicable state or Federal statute or rule or
regulation thereunder so as to maintain the Trust's characterization as a
partnership for Federal income tax purposes and (d) collect or cause to be
collected any withholding tax as described in and in accordance with Section
5.2(c) with respect to income or distributions to Certificateholders. The Owner
Trustee shall make all elections pursuant to this Section as directed by the
Holder of the GP Interest. The Owner Trustee shall sign all tax information
returns furnished to it by the Holder of the GP Interest filed pursuant to this
Section 5.6 and any other returns as may be required by law and so furnished to
it by the Holder of the GP Interest, and in doing so shall rely entirely upon,
and shall have no liability for information provided by, or calculations
provided by, the Holder of the GP Interest. The Holder of the GP Interest shall
cause the Trust to elect under Section 1278 of the Code to include in income
currently any market discount that accrues with respect to the Receivables.
SECTION 5.7. SIGNATURE ON RETURNS; TAX MATTERS PARTNER. (a)
Notwithstanding the provisions of Section 5.6, the Owner Trustee shall sign on
behalf of the Trust the tax returns of the Trust furnished to it in execution
form by the Holder of the GP Interest, unless applicable law requires a
Certificateholder to sign such documents, in which case such documents shall be
signed by the Holder of the GP Interest.
(b) The Holder of the GP Interest shall be the "tax matters partner"
of the Trust pursuant to the Code.
ARTICLE VI
AUTHORITY AND DUTIES OF OWNER TRUSTEE
SECTION 6.1. GENERAL AUTHORITY. The Owner Trustee is authorized and
directed to execute and deliver the Basic Documents to which the Trust is named
as a party and each certificate or other document presented in connection
therewith attached as an exhibit to or contemplated by the Basic Documents to
which the Trust is named as a party and any amendment thereto, in each case, in
such form as the Depositor shall approve as evidenced conclusively by the Owner
Trustee's execution thereof, and on behalf of the Trust, to direct the Trustee
to authenticate and deliver Class A-1 Notes in the aggregate principal amount of
$17,500,000, Class A-2 Notes in the aggregate principal amount of $44,500,000
and Class A-3 Notes in the aggregate principal amount of $28,000,000. In
addition to the foregoing, the Owner Trustee is authorized, but shall not be
obligated, to take all actions required of the Trust pursuant to the Basic
Documents. The Owner Trustee is further authorized from time to time to take
such action as the Instructing Party recommends with respect to the Basic
Documents so long as such activities are consistent with the terms of the Basic
Documents.
SECTION 6.2. GENERAL DUTIES. It shall be the duty of the Owner Trustee
to discharge (or cause to be discharged) all of its responsibilities pursuant to
the terms of this Agreement and the Sale and Servicing Agreement and to
administer the Trust in the interest of the Certificateholders, subject to the
Basic Documents and in accordance with the provisions of this Agreement.
Notwithstanding the foregoing, the Owner Trustee shall be deemed to have
discharged its duties and responsibilities hereunder and under the Basic
Documents to the extent the Servicer has agreed in the Sale and Servicing
Agreement or the Holder of the GP Interest has agreed hereunder or thereunder to
perform any act or to discharge any duty of the Owner Trustee hereunder or under
any Basic Document, and the Owner Trustee shall not be liable for the default or
failure of the Servicer or the Holder of the GP Interest to carry out its
obligations hereunder or thereunder.
SECTION 6.3. ACTION UPON INSTRUCTION. (a) Subject to Article IV, the
Security Insurer (so long as an Insurer Default shall not have occurred and be
continuing) or the Holder of the Voting Interest (if an Insurer Default shall
have occurred and be continuing) (the "Instructing Party") shall have the
exclusive right to direct the actions of the Owner Trustee in the management of
the Trust. Such direction may be exercised at any time by written instruction of
the Holder of the Voting Interest pursuant to Article IV.
(b) The Owner Trustee shall not be required to take any action
hereunder or under any Basic Document if the Owner Trustee shall have reasonably
determined, or shall have been advised by counsel, that such action is likely to
result in liability on the part of the Owner Trustee or is contrary to the terms
hereof or of any Basic Document or is otherwise contrary to law.
(c) Whenever the Owner Trustee is unable to decide between alternative
courses of action permitted or required by the terms of this Agreement or any
Basic Document, the Owner Trustee shall promptly give notice (in such form as
shall be appropriate under the circumstances) to the Instructing Party
requesting instruction as to the course of action to be adopted, and to the
extent the Owner Trustee acts in good faith in accordance with any written
instruction of the Instructing Party received, the Owner Trustee shall not be
liable on account of such action to any Person. If the Owner Trustee shall not
have received appropriate instruction within ten days of such notice (or within
such shorter period of time as reasonably may be specified in such notice or may
be necessary under the circumstances) it may, but shall be under no duty to,
take or refrain from taking such action, not inconsistent with this Agreement or
the Basic Documents, as it shall deem to be in the best interests of the
Certificateholders and the Security Insurer, and shall have no liability to any
Person for such action or inaction.
(d) In the event that the Owner Trustee is unsure as to the
application of any provision of this Agreement or any Basic Document or any such
provision is ambiguous as to its application, or is, or appears to be, in
conflict with any other applicable provision, or in the event that this
Agreement permits any determination by the Owner Trustee or is silent or is
incomplete as to the course of action that the Owner Trustee is required to take
with respect to a particular set of facts, the Owner Trustee may give notice (in
such form as shall be appropriate under the circumstances) to the Instructing
Party requesting instruction and, to the extent that the Owner Trustee acts or
refrains from acting in good faith in accordance with any such instruction, the
Owner Trustee shall not be liable, on account of such action or inaction, to any
Person. If the Owner Trustee shall not have received appropriate instruction
within 10 days of such notice (or within such shorter period of time as
reasonably may be specified in such notice or may be necessary under the
circumstances) it may, but shall be under no duty to, take or refrain from
taking such action, not inconsistent with this Agreement or the Basic Documents,
as it shall deem to be in the best interests of the Certificateholders and the
Security Insurer, and shall have no liability to any Person for such action or
inaction.
SECTION 6.4. NO DUTIES EXCEPT AS SPECIFIED IN THIS AGREEMENT OR IN
INSTRUCTIONS. The Owner Trustee shall not have any duty or obligation to manage,
make any payment with respect to, register, record, sell, dispose of, or
otherwise deal with the Owner Trust Estate, or to otherwise take or refrain from
taking any action under, or in connection with, any document contemplated hereby
to which the Owner Trustee is a party, except as expressly provided by the terms
of this Agreement or in any document or written instruction received by the
Owner Trustee pursuant to Section 6.3; and no implied duties or obligations
shall be read into this Agreement or any Basic Document against the Owner
Trustee. The Owner Trustee shall have no responsibility for filing any financing
or continuation statement in any public office at any time or to otherwise
perfect or maintain the perfection of any security interest or lien granted to
it hereunder or to prepare or file any Commission filing for the Trust or to
record this Agreement or any Basic Document. The Owner Trustee nevertheless
agrees that it will, at its own cost and expense, promptly take all action as
may be necessary to discharge any Liens on any part of the Owner Trust Estate
that result from actions by, or claims against, the Owner Trustee (solely in its
individual capacity) and that are not related to the ownership or the
administration of the Owner Trust Estate.
SECTION 6.5. NO ACTION EXCEPT UNDER SPECIFIED DOCUMENTS OR
INSTRUCTIONS. The Owner Trustee shall not manage, control, use, sell, dispose of
or otherwise deal with any part of the Owner Trust Estate except (i) in
accordance with the powers granted to and the authority conferred upon the Owner
Trustee pursuant to this Agreement, (ii) in accordance with the Basic Documents
and (iii) in accordance with any document or instruction delivered to the Owner
Trustee pursuant to Section 6.3.
SECTION 6.6. RESTRICTIONS. The Owner Trustee shall not take any action
(a) that is inconsistent with the purposes of the Trust set forth in Section 2.3
or (b) that, to the actual knowledge of the Owner Trustee, would result in the
Trust's becoming taxable as a corporation for Federal income tax purposes. The
Certificateholders shall not direct the Owner Trustee to take action that would
violate the provisions of this Section.
SECTION 6.7. NOTICE OF DEFAULT UNDER INDENTURE. Within 10 business
days of receipt of a notice of Default under the Indenture, the Owner Trustee
shall provide notice to each Certificateholder by letter.
ARTICLE VII
CONCERNING THE OWNER TRUSTEE
SECTION 7.1. ACCEPTANCE OF TRUSTS AND DUTIES. The Owner Trustee
accepts the trusts hereby created and agrees to perform its duties hereunder
with respect to such trusts but only upon the terms of this Agreement. The Owner
Trustee in its individual capacity also agrees to disburse all moneys actually
received by it constituting part of the Owner Trust Estate upon the terms of the
Basic Documents and this Agreement. The Owner Trustee in its individual capacity
shall not be answerable or accountable hereunder or under any Basic Document
under any circumstances, except (i) for its own willful misconduct, bad faith or
negligence (ii) in the case of the inaccuracy of any representation or warranty
contained in Section 7.3 expressly made by the Owner Trustee, in its individual
capacity, (iii) for liabilities arising from the failure of the Owner Trustee to
perform obligations expressly undertaken by it in the last sentence of Section
6.4 hereof, (iv) for any investments issued by the Owner Trustee or any branch
or affiliate thereof in its commercial capacity or (v) for taxes, fees or other
charges on, based on or measured by, any fees, commissions or compensation
received by the Owner Trustee in its individual capacity. In particular, but not
by way of limitation (and subject to the exceptions set forth in the preceding
sentence):
(a) the Owner Trustee shall not be liable for any error of
judgment made by a Responsible Officer of the Owner Trustee;
(b) the Owner Trustee shall not be liable with respect to
any action taken or omitted to be taken by it in accordance with the
instructions of the Servicer, the Holder of the GP Interest, the
Holder of the Voting Interest or any Certificateholder;
(c) no provision of this Agreement or any Basic Document
shall require the Owner Trustee to expend or risk funds or otherwise
incur any financial liability in the performance of any of its rights
or powers hereunder or under any Basic Document if the Owner Trustee
shall have reasonable grounds for believing that repayment of such
funds or adequate indemnity against such risk or liability is not
reasonably assured or provided to it;
(d) under no circumstances shall the Owner Trustee be liable
for indebtedness evidenced by or arising under any of the Basic
Documents, including the principal of and interest on the Notes;
(e) the Owner Trustee shall not be responsible for or in
respect of the validity or sufficiency of this Agreement or for the
due execution hereof by the Depositor or for the form, character,
genuineness, sufficiency, value or validity of any of the Owner Trust
Estate or for or in respect of the validity or sufficiency of the
Basic Documents, other than the certificate of authentication on the
Trust Certificates, and the Owner Trustee shall in no event assume or
incur any liability, duty or obligation to the Security Insurer,
Trustee, Indenture Collateral Agent, the Collateral Agent, any
Noteholder or to any Certificateholder, other than as expressly
provided for herein and in the Basic Documents;
(f) the Owner Trustee shall not be liable for the default or
misconduct of the Security Insurer, the Trustee, the Servicer or the
Holder of the GP Interest or the Holder of the Voting Interest under
any of the Basic Documents or otherwise and the Owner Trustee shall
have no obligation or liability to insure compliance by the Servicer
or the Holder of the GP Interest or the Holder of the Voting Interest
with any agreement to which it is a party or to perform the
obligations of the Trust under this Agreement or the Basic Documents
that are required to be performed by the Trustee under the Indenture
or the Servicer under the Sale and Servicing Agreement or the Holder
of the GP Interest under the Agreement; and
(g) the Owner Trustee shall be under no obligation to
exercise any of the rights or powers vested in it by this Agreement,
or to institute, conduct or defend any litigation under this Agreement
or otherwise or in relation to this Agreement or any Basic Document,
at the request, order or direction of any of the Certificateholders or
the Holder of the Voting Interest, 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 Agreement or in
any Basic Document shall not be construed as a duty, and the Owner
Trustee shall not be answerable for other than its negligence, bad
faith or willful misconduct in the performance of any such act.
SECTION 7.2. FURNISHING OF DOCUMENTS. The Owner Trustee shall furnish
to the Certificateholders promptly upon receipt of a written request therefor,
duplicates or copies of all reports, notices, requests, demands, certificates,
financial statements and any other instruments furnished to the Owner Trustee
under the Basic Documents.
SECTION 7.3. REPRESENTATIONS AND WARRANTIES. The Owner Trustee in its
individual capacity hereby represents and warrants to the Depositor, the
Security Insurer, the Representative, and for the benefit of the
Certificateholders, that:
(a) It is a Delaware banking corporation, duly organized and
validly existing in good standing under the laws of the State of
Delaware. It has all requisite corporate power and authority to
execute, deliver and perform its obligations under this Agreement.
(b) It has taken all corporate action necessary to authorize
the execution and delivery by it of this Agreement, and this Agreement
will be executed and delivered by one of its officers who is duly
authorized to execute and deliver this Agreement on its behalf.
(c) Neither the execution nor the delivery by it of this
Agreement, nor the consummation by it of the transactions contemplated
hereby nor compliance by it with any of the terms or provisions hereof
will contravene any federal or Delaware state law, governmental rule
or regulation governing the banking or trust powers of the Owner
Trustee or any judgment or order binding on it, or constitute any
default under its charter documents or by-laws or any indenture,
mortgage, contract, agreement or instrument to which it is a party or
by which any of its properties may be bound.
SECTION 7.4. RELIANCE; ADVICE OF COUNSEL. (a) The Owner Trustee shall
incur no liability to anyone in acting upon any signature, instrument, notice,
resolution, request, consent, order, certificate, report, opinion, bond or other
document or paper believed by it to be genuine and believed by it to be signed
by the proper party or parties. The Owner Trustee may accept a certified copy of
a resolution of the board of directors or other governing body of any corporate
party as conclusive evidence that such resolution has been duly adopted by such
body and that the same is in full force and effect. As to any fact or matter the
method of the determination of which is not specifically prescribed herein, the
Owner Trustee may for all purposes hereof rely on a certificate, signed by the
president or any vice president or by the treasurer, secretary or other
authorized officers of the relevant party, as to such fact or matter, and such
certificate shall constitute full protection to the Owner Trustee for any action
taken or omitted to be taken by it in good faith in reliance thereon.
(b) In the exercise or administration of the trusts hereunder and in
the performance of its duties and obligations under this Agreement or the Basic
Documents, the Owner Trustee (i) may act directly or through its agents or
attorneys pursuant to agreements entered into with any of them, and the Owner
Trustee shall not be liable for the conduct or misconduct of such agents or
attorneys if such agents or attorneys shall have been selected by the Owner
Trustee with reasonable care, and (ii) may consult with counsel, accountants and
other skilled persons to be selected with reasonable care and employed by it.
The Owner Trustee shall not be liable for anything done, suffered or omitted in
good faith by it in accordance with the written opinion or advice of any such
counsel, accountants or other such persons and not contrary to this Agreement or
any Basic Document herein.
SECTION 7.5. NOT ACTING IN INDIVIDUAL CAPACITY. Except as provided
herein or in any other Basic Document, in accepting the trusts hereby created
Bankers Trust (Delaware) acts solely as Owner Trustee hereunder and not in its
individual capacity and all Persons having any claim against the Owner Trustee
by reason of the transactions contemplated by this Agreement or any Basic
Document shall look only to the Owner Trust Estate for payment or satisfaction
thereof.
SECTION 7.6. OWNER TRUSTEE NOT LIABLE FOR TRUST CERTIFICATES OR
RECEIVABLES. The recitals contained herein and in the Trust Certificates (other
than the signature and countersignature of the Owner Trustee on the Trust
Certificates) shall be taken as the statements of the Depositor and the Owner
Trustee assumes no responsibility for the correctness thereof. The Owner Trustee
makes no representations as to the validity or sufficiency of this Agreement, of
any Basic Document or of the Trust Certificates (other than the signature and
countersignature of the Owner Trustee on the Trust Certificates) or the Notes,
or of any Receivable or related documents. The Owner Trustee shall at no time
have any responsibility or liability for or with respect to the legality,
validity and enforceability of any Receivable, or the perfection and priority of
any security interest created by any Receivable in any Financed Vehicle or the
maintenance of any such perfection and priority, or for or with respect to the
sufficiency of the Owner Trust Estate or its ability to generate the payments to
be distributed to Certificateholders under this Agreement or the Noteholders
under the Indenture, including, without limitation: the existence, condition and
ownership of any Financed Vehicle; the existence and enforceability of any
insurance thereon; the existence and contents of any Receivable on any computer
or other record thereof; the validity of the assignment of any Receivable to the
Trust or of any intervening assignment; the completeness of any Receivable; the
performance or enforcement of any Receivable; the compliance by the Depositor or
the Servicer with any warranty or representation made under any Basic Document
or in any related document or the accuracy of any such warranty or
representation or any action of the Trustee or the Servicer or any subservicer
taken in the name of the Owner Trustee.
SECTION 7.7. OWNER TRUSTEE MAY OWN TRUST CERTIFICATES AND NOTES. The
Owner Trustee in its individual or any other capacity may become the owner or
pledgee of Trust Certificates or Notes and may deal with the Depositor, the
Trustee and the Servicer in banking transactions with the same rights as it
would have if it were not Owner Trustee.
SECTION 7.8. PAYMENTS FROM OWNER TRUST ESTATE. All payments to be made
by the Owner Trustee under this Agreement or any of the Basic Documents to which
the Trust or the Owner Trustee is a party shall be made only from the income and
proceeds of the Owner Trust Estate and only to the extent that the Owner Trust
shall have received income or proceeds from the Owner Trust Estate to make such
payments in accordance with the terms hereof. Bankers Trust (Delaware), or any
successor thereto, in its individual capacity, shall not be liable for any
amounts payable under this Agreement or any of the Basic Documents to which the
Trust or the Owner Trustee is a party.
SECTION 7.9. DOING BUSINESS IN OTHER JURISDICTIONS. Notwithstanding
anything contained to the contrary, neither Bankers Trust (Delaware) or any
successor thereto, nor the Owner Trustee shall be required to take any action in
any jurisdiction other than in the State of Delaware if the taking of such
action will, even after the appointment of a co-trustee or separate trustee in
accordance with Section 10.5 hereof, (i) require the consent or approval or
authorization or order of or the giving of notice to, or the registration with
or the taking of any other action in respect of, any state or other governmental
authority or agency of any jurisdiction other than the State of Delaware; (ii)
result in any fee, tax or other governmental charge under the laws of the State
of Delaware becoming payable by Bankers Trust (Delaware) (or any successor
thereto); or (iii) subject Bankers Trust (Delaware) (or any successor thereto)
to personal jurisdiction in any jurisdiction other than the State of Delaware
for causes of action arising from acts unrelated to the consummation of the
transactions by Bankers Trust (Delaware) (or any successor thereto) or the Owner
Trustee, as the case may be, contemplated hereby.
ARTICLE VIII
COMPENSATION OF OWNER TRUSTEE
SECTION 8.1. OWNER TRUSTEE'S FEES AND EXPENSES. The Owner Trustee and
the Holder of the Voting Interest shall receive as compensation for their
respective services hereunder such fees as have been separately agreed upon
before the date hereof between the Representative and the Owner Trustee or the
Holder of the Voting Interest, as applicable, and the Owner Trustee and the
Holder of the Voting Interest shall be entitled to be reimbursed by the Holder
of the GP Interest for their respective other reasonable expenses hereunder,
including the reasonable compensation, expenses and disbursements of such
agents, representatives, experts and counsel as the Owner Trustee or the Holder
of the Voting Interest may employ in connection with the exercise and
performance of their respective rights and duties hereunder; PROVIDED, HOWEVER,
that the Owner Trustee shall only be entitled to reimbursement for expenses
hereunder to the extent such expenses (i) are fees of outside counsel engaged by
the Owner Trustee in respect of the performance of its obligations hereunder,
but up to a dollar amount not to exceed the amount previously agreed to with the
Representative or (ii) relate to the performance of its obligations pursuant to
Section 5.6 hereof.
SECTION 8.2. INDEMNIFICATION. The Holder of the GP Interest shall be
liable as primary obligor for, and shall indemnify the Owner Trustee and the
Holder of the Voting Interest and their respective successors, assigns, agents
and servants (collectively, the "Indemnified Parties") from and against, any and
all liabilities, obligations, losses, damages, taxes, claims, actions and suits,
and any and all reasonable costs, expenses and disbursements (including
reasonable legal fees and expenses) of any kind and nature whatsoever
(collectively, "Expenses") which may at any time be imposed on, incurred by, or
asserted against the Owner Trustee or any Indemnified Party in any way relating
to or arising out of this Agreement, the Basic Documents, the Owner Trust
Estate, the administration of the Owner Trust Estate or the action or inaction
of the Owner Trustee or the Holder of the Voting Interest hereunder, except only
that the Holder of the GP Interest shall not be liable for or required to
indemnify the Owner Trustee from and against Expenses arising or resulting from
any of the matters described in the third sentence of Section 7.1. The
indemnities contained in this Section shall survive the resignation or
termination of the Owner Trustee or the termination of this Agreement. In any
event of any claim, action or proceeding for which indemnity will be sought
pursuant to this Section, the Owner Trustee's choice of legal counsel shall be
subject to the approval of the Holder of the GP Interest which approval shall
not be unreasonably withheld.
SECTION 8.3. 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 Owner Trust Estate immediately after such payment.
SECTION 8.4. NON-RECOURSE OBLIGATIONS. Notwithstanding anything in
this Agreement or any Basic Document, the Owner Trustee agrees in its individual
capacity and in its capacity as Owner Trustee for the Trust that all obligations
of the Trust to the Owner Trustee individually or as Owner Trustee for the Trust
shall be recourse to the Owner Trust Estate only and specifically shall not be
recourse to the assets of any Certificateholder.
ARTICLE IX
TERMINATION OF TRUST AGREEMENT
SECTION 9.1. TERMINATION OF TRUST AGREEMENT. (a) This Agreement and
the Trust shall terminate and be of no further force or effect upon the latest
of (i) the maturity or other liquidation of the last Receivable (including the
purchase by the Servicer at its option of the corpus of the Trust as described
in Section 9.1 of the Sale and Servicing Agreement) and the subsequent
distribution of amounts in respect of such Receivables as provided in the
Related Documents, (ii) the payment to Certificateholders of all amounts
required to be paid to them pursuant to this Agreement and the payment to the
Security Insurer of all amounts payable or reimbursable to it, or (iii) at the
time provided in Section 9.2; PROVIDED, HOWEVER, that in no event shall the
trust created by this Agreement continue beyond the expiration of 21 years from
the death of the last survivor of the descendants living on the date of this
Agreement of Xxxx Xxxxxxx of the Commonwealth of Massachusetts; and provided,
further, that the rights to indemnification under Section 8.2 shall survive the
termination of the Trust. The Servicer shall promptly notify the Owner Trustee
and the Security Insurer of any prospective termination pursuant to this Section
9.1. Except as provided in Section 9.2, the bankruptcy, liquidation,
dissolution, death or incapacity of any Certificateholder, other than the Holder
of the GP Interest as described in Section 9.2, shall not (x) operate to
terminate this Agreement or the Trust, nor (y) entitle such Certificateholder's
legal representatives or heirs to claim an accounting or to take any action or
proceeding in any court for a partition or winding up of all or any part of the
Trust or Owner Trust Estate nor (z) otherwise affect the rights, obligations and
liabilities of the parties hereto.
(b) Except as provided in clause (a), neither the Depositor nor the
Holder of the GP Interest nor any Certificateholder shall be entitled to revoke
or terminate the Trust.
(c) Notice of any termination of the Trust, specifying the
Distribution Date upon which the Certificateholders shall surrender their Trust
Certificates to the Certificate Paying Agent for payment of the final
distribution and cancellation, shall be given by the Owner Trustee by letter to
Certificateholders mailed within five Business Days of receipt of notice of such
termination from the Servicer given pursuant to Section 9.1(c) of the Sale and
Servicing Agreement, stating (i) the Distribution Date upon or with respect to
which final payment of the Trust Certificates shall be made upon presentation
and surrender of the Trust Certificates at the office of the Certificate Paying
Agent therein designated, (ii) the amount of any such final payment and (iii)
that the Record Date otherwise applicable to such Distribution Date is not
applicable, payments being made only upon presentation and surrender of the
Trust Certificates at the office of the Certificate Paying Agent therein
specified. The Owner Trustee shall give such notice to the Certificate Registrar
(if other than the Owner Trustee) and the Certificate Paying Agent at the time
such notice is given to Certificateholders. Upon presentation and surrender of
the Trust Certificates, the Certificate Paying Agent shall cause to be
distributed to Certificateholders amounts distributable on such Distribution
Date pursuant to Section 5.2.
In the event that all of the Certificateholders shall not surrender
their Trust Certificates for cancellation within six months after the date
specified in the above mentioned written notice, the Owner Trustee shall give a
second written notice to the remaining Certificateholders to surrender their
Trust Certificates for cancellation and receive the final distribution with
respect thereto. If within one year after the second notice all the Trust
Certificates shall not have been surrendered for cancellation, the Owner Trustee
may take appropriate steps, or may appoint an agent to take appropriate steps,
to contact the remaining Certificateholders concerning surrender of their Trust
Certificates, and the cost thereof shall be paid out of the funds and other
assets that shall remain subject to this Agreement. Any funds remaining in the
Trust after exhaustion of such remedies shall be distributed, subject to
applicable escheat laws, by the Owner Trustee to the Holder of the GP Interest.
Certificateholders shall thereafter look solely to the Holder of the GP Interest
as general unsecured creditors.
(d) Any funds remaining in the Trust after funds for final
distribution have been distributed or set aside for distribution shall be
distributed by the Owner Trustee to the Holder of the GP Interest.
(e) Upon the winding up of the Trust and its termination, the
Owner Trustee shall cause the Certificate of Trust to be canceled by filing a
certificate of cancellation with the Secretary of State in accordance with the
provisions of Section 3810 of the Business Trust Statute.
SECTION 9.2. DISSOLUTION UPON BANKRUPTCY OF THE HOLDER OF THE
GP INTEREST. In the event that an Insolvency Event shall occur with respect to
the Holder of the GP Interest, the Trust shall dissolve and this Agreement shall
be terminated in accordance with Section 9.1 90 days after the date of such
Insolvency Event, unless, before the end of such 90-day period, the Owner
Trustee shall have received written instructions from the Instructing Party to
the effect that each such party disapproves of the liquidation of the
Receivables and termination of the Trust. Promptly after the occurrence of any
Insolvency Event with respect to the Holder of the GP Interest (i) the Holder of
the GP Interest shall give the Trustee, the Owner Trustee and the Security
Insurer written notice of such Insolvency Event, (ii) the Owner Trustee shall,
upon the receipt of such written notice from the Holder of the GP Interest, give
prompt written notice to the Certificateholders and the Trustee of the
occurrence of such event and (iii) the Trustee shall, upon receipt of written
notice of such Insolvency Event from the Owner Trustee or the Holder of the GP
Interest, give prompt written notice to the Noteholders of the occurrence of
such event; PROVIDED, however, that any failure to give a notice required by
this sentence shall not prevent or delay, in any manner, a termination of the
Trust pursuant to the first sentence of this Section 9.2. Upon a termination
pursuant to this Section, the Security Insurer or, if an Insurer Default has
occurred and is continuing, the Owner Trustee shall direct the Trustee promptly
to sell the assets of the Owner Trust Estate in a commercially reasonable manner
and on commercially reasonable terms. The proceeds of such a sale of the assets
of the Trust shall be treated as collections under the Sale and Servicing
Agreement and shall be distributed in accordance with Section 9.1(b) thereof.
ARTICLE X
SUCCESSOR OWNER TRUSTEES AND ADDITIONAL OWNER TRUSTEES
SECTION 10.1. ELIGIBILITY REQUIREMENTS FOR OWNER TRUSTEE. The Owner
Trustee shall at all times be a corporation (i) satisfying the provisions of
Section 3807(a) of the Business Trust Statute; (ii) authorized to exercise
corporate trust powers; (iii) having a combined capital and surplus of at least
$50,000,000 and subject to supervision or examination by Federal or State
authorities; and (iv) acceptable to the Security Insurer in its sole discretion,
so long as an Insurer Default shall not have occurred and be continuing. If such
corporation shall publish reports of condition at least annually, pursuant to
law or to the requirements of the aforesaid supervising or examining authority,
then for the purpose of this Section, the combined capital and surplus of such
corporation shall be deemed to be its combined capital and surplus as set forth
in its most recent report of condition so published. In case at any time the
Owner Trustee shall cease to be eligible in accordance with the provisions of
this Section, the Owner Trustee shall resign immediately in the manner and with
the effect specified in Section 10.2.
SECTION 10.2. RESIGNATION OR REMOVAL OF OWNER Trustee. The Owner
Trustee may at any time resign and be discharged from the trusts hereby created
by giving written notice thereof to the Holder of the GP Interest, the Security
Insurer and the Servicer. Upon receiving such notice of resignation, the Holder
of the GP Interest shall promptly appoint a successor Owner Trustee acceptable
to the Security Insurer by written instrument, in duplicate, one copy of which
instrument shall be delivered to the resigning Owner Trustee and one copy to the
successor Owner Trustee, provided that the Holder of the GP Interest shall have
received written confirmation from each of the Rating Agencies that the proposed
appointment will not result in an increased capital charge to the Security
Insurer by either of the Rating Agencies. If no successor Owner Trustee shall
have been so appointed and have accepted appointment within 30 days after the
giving of such notice of resignation, the resigning Owner Trustee or the
Security Insurer may petition any court of competent jurisdiction for the
appointment of a successor Owner Trustee.
If at any time the Owner Trustee shall cease to be eligible in
accordance with the provisions of Section 10.1 and shall fail to resign after
written request therefor by the Servicer, 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 Servicer with the consent of the Security Insurer (so long
as an Insurer Default shall not have occurred and be continuing) or the Security
Insurer may remove the Owner Trustee. If the Servicer shall remove the Owner
Trustee under the authority of the immediately preceding sentence, the Servicer
shall promptly appoint a successor Owner Trustee acceptable to the Security
Insurer by written instrument, in duplicate, one copy of which instrument shall
be delivered to the outgoing Owner Trustee so removed, one copy to the Security
Insurer and one copy to the successor Owner Trustee and payment of all fees owed
to the outgoing Owner Trustee.
Any resignation or removal of the Owner Trustee and appointment of a
successor Owner Trustee pursuant to any of the provisions of this Section shall
not become effective until acceptance of appointment by the successor Owner
Trustee pursuant to Section 10.3 and payment of all fees and expenses owed to
the outgoing Owner Trustee. The Servicer shall provide notice of such
resignation or removal of the Owner Trustee to each of the Rating Agencies.
SECTION 10.3. SUCCESSOR OWNER TRUSTEE. Any successor Owner Trustee
appointed pursuant to Section 10.2 shall execute, acknowledge and deliver to the
Holder of the GP Interest, the Security Insurer, the Servicer, and to its
predecessor Owner Trustee an instrument accepting such appointment under this
Agreement, and thereupon the resignation or removal of the predecessor Owner
Trustee shall become effective and such successor Owner Trustee, without any
further act, deed or conveyance, shall become fully vested with all the rights,
powers, duties and obligations of its predecessor under this Agreement, with
like effect as if originally named as Owner Trustee. The predecessor Owner
Trustee shall upon payment of its fees and expenses deliver to the successor
Owner Trustee all documents and statements and monies held by it under this
Agreement; and the Servicer and the predecessor Owner Trustee shall execute and
deliver such instruments and do such other things as may reasonably be required
for fully and certainly vesting and confirming in the successor Owner Trustee
all such rights, powers, duties and obligations.
No successor Owner Trustee shall accept appointment as provided in
this Section unless at the time of such acceptance such successor Owner Trustee
shall be eligible pursuant to Section 10.1.
Upon acceptance of appointment by a successor Owner Trustee pursuant
to this Section, the Servicer shall mail notice of the successor of such Owner
Trustee to all Certificateholders, the Security Insurer, the Trustee, the
Noteholders and the Rating Agencies. If the Servicer shall fail to mail such
notice within 10 days after acceptance of appointment by the successor Owner
Trustee, the successor Owner Trustee shall cause such notice to be mailed at the
expense of the Servicer.
SECTION 10.4. MERGER OR CONSOLIDATION OF OWNER TRUSTEE. Any
corporation into which the Owner Trustee may be merged or converted or with
which it may be consolidated, or any corporation resulting from any merger,
conversion or consolidation to which the Owner Trustee shall be a party, or any
corporation succeeding to all or substantially all of the corporate trust
business of the Owner Trustee, shall be the successor of the Owner Trustee
hereunder, provided such corporation shall be eligible pursuant to Section 10.1,
without the execution or filing of any instrument or any further act on the part
of any of the parties hereto, anything herein to the contrary notwithstanding;
provided further that the Owner Trustee shall mail notice of such merger or
consolidation to the Rating Agencies.
SECTION 10.5. APPOINTMENT OF CO-TRUSTEE OR SEPARATE TRUSTEE.
Notwithstanding any other provisions of this Agreement, at any time, for the
purpose of meeting any legal requirements of any jurisdiction in which any part
of the Owner Trust Estate or any Financed Vehicle may at the time be located,
the Servicer and the Owner Trustee acting jointly shall have the power and shall
execute and deliver all instruments to appoint one or more Persons approved by
the Owner Trustee and the Security Insurer to act as co-trustee, jointly with
the Owner Trustee, or separate trustee or separate trustees, of all or any part
of the Owner Trust Estate, and to vest in such Person, in such capacity, such
title to the Trust, or any part thereof, and, subject to the other provisions of
this Section, such powers, duties, obligations, rights and trusts as the
Servicer and the Owner Trustee may consider necessary or desirable. If the
Servicer shall not have joined in such appointment within 15 days after the
receipt by it of a request so to do, the Owner Trustee subject, unless an
Insurer Default shall have occurred and be continuing, to the approval of the
Security Insurer (which approval shall not be unreasonably withheld) alone shall
have the power to make such appointment. No co-trustee or separate trustee
under this Agreement shall be required to meet the terms of eligibility as a
successor trustee pursuant to Section 10.1 and no notice of the appointment of
any co-trustee or separate trustee shall be required pursuant to Section 10.3.
Each separate trustee and co-trustee shall, to the extent permitted by
law, be appointed and act subject to the following provisions and conditions:
(i) all rights, powers, duties and obligations conferred or
imposed upon the Owner Trustee shall be conferred upon and exercised or
performed by the Owner Trustee and such separate trustee or co-trustee
jointly (it being understood that such separate trustee or co-trustee
is not authorized to act separately without the Owner Trustee joining
in such act), except to the extent that under any law of any
jurisdiction in which any particular act or acts are to be performed,
the Owner Trustee shall be incompetent or unqualified to perform such
act or acts, in which event such rights, powers, duties and obligations
(including the holding of title to the Trust or any portion thereof in
any such jurisdiction) shall be exercised and performed singly by such
separate trustee or co-trustee, but solely at the direction of the
Owner Trustee;
(ii) no trustee under this Agreement shall be personally
liable by reason of any act or omission of any other trustee under this
Agreement; and
(iii) the Servicer and the Owner Trustee acting jointly may at
any time accept the resignation of or remove any separate trustee or
co-trustee.
Any notice, request or other writing given to the Owner Trustee shall
be deemed to have been given to each of the then separate trustees and
co-trustees, as effectively as if given to each of them. Every instrument
appointing any separate trustee or co-trustee shall refer to this Agreement and
the conditions of this Article. Each separate trustee and co-trustee, upon its
acceptance of the trusts conferred, shall be vested with the estates or property
specified in its instrument of appointment, either jointly with the Owner
Trustee or separately, as may be provided therein, subject to all the provisions
of this Agreement, specifically including every provision of this Agreement
relating to the conduct of, affecting the liability of, or affording protection
to, the Owner Trustee. Each such instrument shall be filed with the Owner
Trustee and a copy thereof given to the Servicer and the Security Insurer.
Any separate trustee or co-trustee may at any time appoint the Owner
Trustee, its agent or attorney-in-fact with full power and authority, to the
extent not prohibited by law, to do any lawful act under or in respect of this
Agreement on its behalf and in its name. If any separate trustee or co-trustee
shall die, become incapable of acting, resign or be removed, all of its estates,
properties, rights, remedies and trusts shall vest in and be exercised by the
Owner Trustee, to the extent permitted by law, without the appointment of a new
or successor trustee.
ARTICLE XI
MISCELLANEOUS
SECTION 11.1. SUPPLEMENTS AND AMENDMENTS. (a) This Agreement may be
amended by the Depositor and the Owner Trustee, with the prior written consent
of the Security Insurer (so long as an Insurer Default shall not have occurred
and be continuing) and with prior written notice to the Rating Agencies, without
the consent of any of the Noteholders or the Certificateholders, (i) to cure any
ambiguity or defect or (ii) to correct, supplement or modify any provisions in
this Agreement; 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 or the Holder of the Voting Interest.
(b) This Agreement may also be amended from time to time, with the
prior written consent of the Security Insurer (so long as an Insurer Default
shall not have occurred and be continuing) by the Depositor and the Owner
Trustee, with prior written notice to the Rating Agencies, with the consent of
the Holders of Notes evidencing not less than a majority of the Outstanding
Amount of the Notes and, to the extent the Certificates or the rights, benefits
or duties of the Holder of the Voting Interest are affected thereby, the consent
of the Holder of the Voting Interest for the purpose of adding any provisions to
or changing in any manner or eliminating any of the provisions of this Agreement
or of modifying in any manner the rights of the Noteholders or the
Certificateholders; PROVIDED, HOWEVER, that, subject to the express rights of
the Security Insurer under the Basic Documents, no such amendment shall (a)
increase or reduce in any manner the amount of, or accelerate or delay the
timing of, collections of payments on Receivables or distributions that shall be
required to be made for the benefit of the Noteholders or the Certificateholders
or (b) reduce the aforesaid percentage of the Outstanding Amount of the Notes
and the Ownership Percentage required to consent to any such amendment, without
the consent of the Holders of all the outstanding Notes and Holders of all
outstanding Certificates.
Promptly after the execution of any such amendment or consent, the
Owner Trustee shall furnish written notification of the substance of such
amendment or consent to each Certificateholder, the Trustee and each of the
Rating Agencies.
It shall not be necessary for the consent of Certificateholders, the
Noteholders or the Trustee pursuant to this Section to approve the particular
form of any proposed amendment or consent, but it shall be sufficient if such
consent shall approve the substance thereof. The manner of obtaining such
consents (and any other consents of the Holder of the Voting Interest or
Certificateholders provided for in this Agreement or in any other Basic
Document) and of evidencing the authorization of the execution thereof by
Certificateholders shall be subject to such reasonable requirements as the Owner
Trustee may prescribe.
Promptly after the execution of any amendment to the Certificate of
Trust, the Owner Trustee shall cause the filing of such amendment with the
Secretary of State.
Prior to the execution of any amendment to this Agreement or the
Certificate of Trust, the Owner Trustee shall be entitled to receive and rely
upon an Opinion of Counsel stating that the execution of such amendment is
authorized or permitted by this Agreement and that all conditions precedent to
the execution and delivery of such amendment have been satisfied. The Owner
Trustee may, but shall not be obligated to, enter into any such amendment which
affects the Owner Trustee's own rights, duties or immunities under this
Agreement or otherwise.
SECTION 11.2. NO LEGAL TITLE TO OWNER TRUST ESTATE IN
CERTIFICATEHOLDERS. The Certificateholders shall not have legal title to any
part of the Owner Trust Estate. The Certificateholders shall be entitled to
receive distributions with respect to their undivided Ownership Percentage
therein only in accordance with Articles V and IX. No transfer, by operation of
law or otherwise, of any right, title or interest of the Certificateholders to
and in their Ownership Percentage in the Owner Trust Estate shall operate to
terminate this Agreement or the trusts hereunder or entitle any transferee to an
accounting or to the transfer to it of legal title to any part of the Owner
Trust Estate.
SECTION 11.3. LIMITATIONS ON RIGHTS OF OTHERS. Except for Section 2.7
and 8.2, the provisions of this Agreement are solely for the benefit of the
Owner Trustee, the Security Insurer, the Depositor, the Certificateholders, the
Holder of the Voting Interest, the Servicer and, to the extent expressly
provided herein, the Trustee and the Noteholders, and nothing in this Agreement,
whether express or implied, shall be construed to give to any other Person any
legal or equitable right, remedy or claim in the Owner Trust Estate or under or
in respect of this Agreement or any covenants, conditions or provisions
contained herein.
SECTION 11.4. NOTICES. (a) Unless otherwise expressly specified or
permitted by the terms hereof, all notices shall be in writing and shall be
deemed given upon receipt personally delivered, delivered by overnight courier
or mailed first class mail or certified mail, in each case return receipt
requested, and shall be deemed to have been duly given upon receipt, if to the
Owner Trustee, addressed to the Corporate Trust Office; if to the Depositor,
addressed to TMS Auto Holdings, Inc., 0000 Xxxx Xxxxx Xxxxxx Xxxx., Xxxxx 000,
Xxxxxxxxxx, Xxxxxxxxxx 00000, Attention: Executive Vice President; if to the
Security Insurer, addressed to MBIA Insurance Corporation, 000 Xxxx Xxxxxx,
Xxxxxx, XX 00000, Attention: Insured Portfolio Management - SF; if to the Holder
of the Voting Interest, addressed to First Union Bank of Delaware, 000 Xxxxx
Xxxxx Xxxxxx, 0xx Xxxxx, Xxxxxxxxx, XX 00000, Attention Executive Officer or, as
to each party, at such other address as shall be designated by such party in a
written notice to each other party.
(b) Any notice required or permitted to be given to a
Certificateholder shall be given by first-class mail, postage prepaid, at the
address of such Holder as shown in the Certificate Register. Any notice so
mailed within the time prescribed in this Agreement shall be conclusively
presumed to have been duly given, whether or not the Certificateholder receives
such notice.
SECTION 11.5. SEVERABILITY. Any provision of this Agreement that is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.
SECTION 11.6. SEPARATE COUNTERPARTS. This Agreement may be executed by
the parties hereto in separate counterparts, each of which when so executed and
delivered shall be an original, but all such counterparts shall together
constitute but one and the same instrument.
SECTION 11.7. SUCCESSORS AND ASSIGNS. This Agreement shall inure to
the benefit of, the Representative, the Holder of the GP Interest, the Holder of
the Voting Interest, the Security Insurer, the Owner Trustee and its successors,
each Certificateholder and its successors and permitted assigns and the Holder
of the Voting Interest and be binding upon the parties hereto and their
respective successors and permitted assigns. Any request, notice, direction,
consent, waiver or other instrument or action by a Certificateholder shall bind
the successors and assigns of such Certificateholder. Except as otherwise
provided in this Agreement, no other Person shall have any right or obligation
hereunder. Without limiting the generality of the foregoing, all covenants and
agreements in this Agreement which confer rights upon the Security Insurer shall
be for the benefit of and run directly to the Security Insurer, and the Security
Insurer shall be entitled to rely on and enforce such covenants, subject,
however, to the limitations on such rights provided in this Agreement and the
Basic Documents. The Security Insurer may disclaim any of its rights and powers
under this Agreement (but not its duties and obligations under the Note Policy)
upon delivery of a written notice to the Owner Trustee.
SECTION 11.8. [Reserved]
SECTION 11.9. NO PETITION. The Owner Trustee (not in its individual
capacity but solely as Owner Trustee), by entering into this Agreement, each
Certificateholder, by accepting a Trust Certificate, the Holder of the Voting
Interest and the Trustee and each Noteholder by accepting the benefits of this
Agreement, hereby covenants and agrees that they will not at any time institute
against the Holder of the GP Interest or the Trust, or join in any institution
against the Holder of the GP Interest or the Trust of, any bankruptcy,
reorganization, arrangement, insolvency or liquidation proceedings, or other
proceedings under any United States Federal or state bankruptcy or similar law
in connection with any obligations relating to the Trust Certificates, the
Notes, this Agreement or any of the Basic Documents.
SECTION 11.10. NO RECOURSE. Each Certificateholder by accepting a
Trust Certificate acknowledges that such Certificateholder's Trust Certificates
represent beneficial interests in the Trust only and do not represent interests
in or obligations of the Seller, the Servicer, the Holder of the GP Interest,
the Holder of the Voting Interest, the Owner Trustee, the Trustee, the Security
Insurer or any Affiliate thereof and no recourse may be had against such parties
or their assets, except as may be expressly set forth or contemplated in this
Agreement, the Trust Certificates or the Basic Documents.
SECTION 11.11. HEADINGS. The headings of the various Articles and
Sections herein are for convenience of reference only and shall not define or
limit any of the terms or provisions hereof.
SECTION 11.12. GOVERNING LAW. THIS AGREEMENT SHALL BE CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF DELAWARE, WITHOUT REFERENCE TO ITS
CONFLICT OF LAW PROVISIONS, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE
PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
SECTION 11.13. [Reserved]
SECTION 11.14. SERVICER. The Servicer is authorized to prepare, or
cause to be prepared, execute and deliver on behalf of the Trust all such
documents, reports, filings, instruments, certificates and opinions as it shall
be the duty of the Trust or Owner Trustee to prepare, file or deliver pursuant
to the Basic Documents. Upon written request, the Owner Trustee shall execute
and deliver to the Servicer a limited power of attorney appointing the Servicer
the Trust's agent and attorney-in-fact to prepare, or cause to be prepared,
execute and deliver all such documents, reports, filings, instruments,
certificates and opinions.
SECTION 11.15. THIRD PARTY BENEFICIARY. The Security Insurer shall be
a third party beneficiary hereof and, so long as no Insurer Default shall have
occurred and be continuing shall be entitled to enforce the provisions hereof as
if a party hereto.
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.
BANKERS TRUST (DELAWARE),
Owner Trustee
By: /s/ M. Xxxx Xxxxxxx
Name: /s/ M. Xxxx Xxxxxxx
Title:
TMS AUTO HOLDINGS, INC.,
Depositor
By: /s/ Xxxxxxx X. Xxxxxx
Name: Xxxxxxx X. Xxxxxx
Title: Senior Vice President
Agreed and Accepted by:
FIRST UNION BANK OF DELAWARE,
Holder of the Voting Interest
By:/s/ Xxxxxx X. Xxxxxx Xx.
Name: Xxxxxx X. Xxxxxx Xx.
Title:
EXHIBIT A
NUMBER
R- CUSIP NO.
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SEE REVERSE FOR CERTAIN DEFINITIONS
THIS TRUST CERTIFICATE HAS NOT BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED (THE "ACT"). THE HOLDER HEREOF, BY PURCHASING THIS TRUST
CERTIFICATE, AGREES THAT THIS TRUST CERTIFICATE MAY BE RESOLD, PLEDGED OR
OTHERWISE TRANSFERRED ONLY IN ACCORDANCE WITH ANY APPLICABLE STATE SECURITIES
LAWS AND (1) TO A PERSON WHO (A) HAS FURNISHED TO THE OWNER TRUSTEE AND HOLDER
OF THE GP INTEREST AN INVESTMENT LETTER IN THE FORM REQUIRED BY THE TRUST
AGREEMENT TO THE EFFECT THAT SUCH PURCHASER IS AN INSTITUTIONAL ACCREDITED
INVESTOR WITHIN THE MEANING OF RULE 501(A)(1)-(3) UNDER THE ACT, OR (B) AN
OPINION OF COUNSEL SATISFACTORY TO THE OWNER TRUSTEE OR (2) PURSUANT TO AN
EFFECTIVE REGISTRATION STATEMENT UNDER THE ACT.
THIS TRUST 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 ARRANGEMENTS OR ACCOUNT'S INVESTMENT IN SUCH ENTITIES. FURTHER, THIS
TRUST 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 HAS NO PRINCIPAL BALANCE.
[THIS CERTIFICATE IS NON-TRANSFERABLE]
1
---------------
1 To be inserted on the Certificate to be held by the Holder of the GP Interest
THE MONEY STORE AUTO TRUST 1997-4
CERTIFICATE
evidencing an Ownership Percentage in certain distributions of the Trust, as
defined below, the property of which includes a pool of non-prime motor vehicle
retail installment sale contracts secured by new and used automobiles light
trucks and vans financed thereby, and sold to the Trust by TMS Auto Holdings,
Inc.
(THIS TRUST CERTIFICATE DOES NOT REPRESENT AN INTEREST IN OR OBLIGATION OF TMS
AUTO HOLDINGS, INC. OR ANY OF ITS AFFILIATES, EXCEPT TO THE EXTENT DESCRIBED
BELOW.)
THIS CERTIFIES THAT ___________________ is the registered owner of
___% in The Money Store Auto Trust 1997-4 (the "Trust") formed by TMS Auto
Holdings, Inc., a Delaware corporation (the "Depositor").
The Trust was created pursuant to a Trust Agreement dated as of
November 30, 1997 (the "Trust Agreement"), between the Depositor and Bankers
Trust (Delaware), not in its individual capacity but solely 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 the duly authorized Trust Certificates
(herein called the "Trust Certificates"). Under the Indenture dated as of
November 30, 1997, between the Trust and Chase Manhattan Bank as trustee and
indenture collateral agent, the Trust issued three classes of Notes designated
as "Class A-1 5.90875% Asset Backed Notes" (the "Class A-1 Notes"), "Class A-2
6.35% Asset Backed Notes" (the "Class A-2 Notes"), "Class A-3 6.46% Asset Backed
Notes" (the "Class A-3 Notes" and, together with the Class A-1 Notes and the
Class A-2 Notes, the "Notes"). This Trust Certificate is issued under and is
subject to the terms, provisions and conditions of the Trust Agreement, to which
Trust Agreement the holder of this Trust Certificate by virtue of the acceptance
hereof assents and by which such holder is bound. The property of the Trust
includes a pool of non prime motor vehicle retail installment sale contracts
secured by new and used automobiles light trucks and vans financed thereby, (the
"Receivables"), all monies received on the Receivables on or after November 30,
1997, security interests in the vehicles financed thereby, certain bank accounts
and the proceeds thereof, proceeds from claims on certain insurance policies and
certain other rights under the Trust Agreement and the Sale and Servicing
Agreement.
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
(the "Distribution Date"), commencing in January 1998 to the Person in whose
name this Trust Certificate is registered at the close of business on the last
day of the calendar month immediately preceding the Distribution Date (the
"Record Date") such Certificateholder's Percentage Interest in the amount to be
distributed to Certificateholders on such Distribution Date.
The holder of this Trust Certificate acknowledges and agrees that its
rights to receive distributions in respect of this Trust Certificate are
subordinated to the rights of the Noteholders as described in the Sale and
Servicing Agreement, the Indenture and the Trust Agreement, as applicable.
It is the intent of the Depositor, Servicer, the Holder of the GP
Interest and Certificateholders that, for purposes of Federal income taxes, the
Trust will be disregarded as an entity apart from its owner if there is only one
owner for Federal income tax purposes, or, if there is more than one owner for
Federal income tax purposes, will be treated as a partnership and the
Certificateholders (including the Holder of the GP Interest) will be treated as
partners in the partnership. The Holder of the GP Interest and the other
Certificateholders by acceptance of a Trust Certificate, agree to treat, and to
take no action inconsistent with the treatment of, the Trust and the Trust
Certificates for such tax purposes as just described.
Each Certificateholder, by its acceptance of a Trust Certificate,
covenants and agrees that such Certificateholder will not at any time institute
against the Trust or the Depositor, or join in any institution against the Trust
or the Depositor of, any bankruptcy, reorganization, arrangement, insolvency or
liquidation proceedings, or other proceedings under any United States Federal or
state bankruptcy or similar law in connection with any obligations relating to
the Trust Certificates, the Notes, the Trust Agreement or any of the Basic
Documents.
Distributions on this Trust Certificate will be made as provided in
the Trust Agreement by the Owner Trustee by wire transfer or check mailed to the
Certificateholder of record in the Trust Certificate Register without the
presentation or surrender of this Trust Certificate or the making of any
notation hereon. Except as otherwise provided in the Trust Agreement and
notwithstanding the above, the final distribution on this Trust Certificate will
be made after due notice by the Owner Trustee of the pendency of such
distribution and only upon presentation and surrender of this Trust Certificate
at the office or agency maintained for the purpose by the Owner Trustee in the
Borough of Manhattan, City of New York.
Reference is hereby made to the further provisions of this Trust
Certificate set forth on the reverse hereof, which further provisions shall for
all purposes have the same effect as if set forth at this place.
Unless the certificate of authentication hereon shall have been
executed by an authorized officer of the Owner Trustee, by manual signature,
this Trust Certificate shall not entitle the holder hereof to any benefit under
the Trust Agreement or the Sale and Servicing Agreement or be valid for any
purpose.
THIS TRUST CERTIFICATE SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF DELAWARE, WITHOUT REFERENCE TO ITS
CONFLICT OF LAW PROVISIONS.
IN WITNESS WHEREOF, the Owner Trustee, on behalf of the Trust and not
in its individual capacity, has caused this Trust Certificate to be duly
executed.
Date:
THE MONEY STORE AUTO TRUST 1997-4
By: BANKERS TRUST (DELAWARE),
solely as Owner Trustee and not in its
individual capacity
By: ________________________
Authorized Signatory
OWNER TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Trust Certificates of The Money Store Auto Trust
1997-4 referred to in the within-mentioned Trust Agreement.
Date:
BANKERS TRUST (DELAWARE),
solely as Owner Trustee and not in its
individual capacity
By:___________________________
Authorized Signatory
(Reverse of Trust Certificate)
The Trust Certificates do not represent an obligation of, or an
interest in, the 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 may be expressly set forth or contemplated herein or in the Trust
Agreement, the Indenture or the Basic Documents. In addition, this Trust
Certificate is not guaranteed by any governmental agency or instrumentality and
is limited in right of payment to certain collections with respect to the
Receivables (and certain other amounts), all as more specifically set forth
herein and in the Sale and Servicing Agreement. The Trust Certificates are
limited in right of payment to certain collections and recoveries respecting the
Receivables, all as more specifically set forth in the Sale and Servicing
Agreement. A copy of each of the Sale and Servicing Agreement and the Trust
Agreement may be examined during normal business hours at the principal office
of the Depositor, and at such other places, if any, designated by the Depositor,
by any Certificateholder upon written request.
The Trust Agreement permits, with certain exceptions therein provided,
the amendment thereof and the modification of the rights and obligations of the
Depositor and the rights of the Certificateholders under the Trust Agreement at
any time by the Depositor and the Owner Trustee with the consent of the holders
of the Notes and the Trust Certificates evidencing not less than a majority of
the outstanding principal balance of the Notes and the Certificate Balance. Any
such consent by the holder of this Trust Certificate shall be conclusive and
binding on such holder and on all future holders of this Trust Certificate and
of any Trust Certificate issued upon the transfer hereof or in exchange hereof
or in lieu hereof whether or not notation of such consent is made upon this
Trust Certificate. The Trust Agreement also permits the amendment thereof, in
certain limited circumstances, without the consent of the holders of any of the
Trust Certificates.
As provided in the Trust Agreement and subject to certain limitations
therein set forth, the transfer of this Trust Certificate is registerable in the
Certificate Register upon surrender of this Trust Certificate for registration
of transfer at the offices or agencies of the Certificate Registrar maintained
by the Owner Trustee in the Borough of Manhattan, The City of New York,
accompanied by a written instrument of transfer in form satisfactory to the
Owner Trustee and the Certificate Registrar duly executed by the holder hereof
or such holder's attorney duly authorized in writing, and thereupon one or more
new Trust Certificates in authorized denominations evidencing the same aggregate
interest in the Trust will be issued to the designated transferee. The initial
Certificate Registrar appointed under the Trust Agreement is Bankers Trust
Company.
As provided in the Trust Agreement and subject to certain limitations
therein set forth, Trust Certificates are exchangeable for new Trust
Certificates in 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.
The Owner Trustee, the Certificate Registrar and any agent of the
Owner Trustee or the Certificate Registrar may treat the person in whose name
this Trust Certificate is registered as the owner hereof for all purposes, and
none of the Owner Trustee, the Certificate Registrar or any such agent shall be
affected by any notice to the contrary.
The obligations and responsibilities created by the Trust Agreement
and the Trust created thereby shall terminate upon the payment to
Certificateholders of all amounts required to be paid to them pursuant to the
Trust Agreement and the Sale and Servicing Agreement and the disposition of all
property held as part of the Owner Trust Estate. The Servicer may at its option
purchase the corpus of the Trust at a price specified in the Sale and Servicing
Agreement, and such purchase of the Receivables and other property of the Trust
will effect early retirement of the Trust Certificates; however, such right of
purchase is exercisable, subject to certain restrictions, only as of the last
day of any Monthly Period as of which the Pool Balance is 5% or less of the
Initial Pool Balance. In addition, if the Servicer does not exercise its option
to purchase the Receivables within 90 days after the last day of the Monthly
Period as of which such right can first be exercised, an auction sale shall be
conducted (as described in the Sale and Servicing Agreement) and such auction
shall effect early retirement of the Certificates.
ASSIGNMENT
FOR VALUE RECEIVED the undersigned hereby sells, assigns and transfers
unto
PLEASE INSERT SOCIAL SECURITY
OR OTHER IDENTIFYING NUMBER
OF ASSIGNEE
(Please print or type name and address, including postal zip code, of assignee)
the within Trust Certificate, and all rights thereunder, hereby irrevocably
constituting and appointing
_______________________________________________ Attorney to transfer said Trust
Certificate on the books of the Trust Certificate Registrar, with full power of
substitution in the premises.
Dated:
*
Signature Guaranteed:
*
--------------------------
*NOTICE: The signature to this assignment must correspond with the
name of the registered owner as it appears on the face of the within Trust
Certificate in every particular, without alteration, enlargement or any change
whatever. Such signature must be guaranteed by an "eligible guarantor
institution" meeting the requirements of the Certificate Registrar, which
requirements include membership or participation in STAMP or such other
"signature guarantee program" as may be determined by the Certificate Registrar
in addition to, or in substitution for, STAMP, all in accordance with the
Securities Exchange Act of 1934, as amended.
EXHIBIT B
[FORM OF]
CERTIFICATE OF TRUST OF
THE MONEY STORE AUTO TRUST 1997-4
THIS Certificate of Trust of The Money Store Auto Trust 1997-4 (the
"Trust"), dated as of __________ __, 199__, is being duly executed and filed by
__________________________, a ________________ and ________________________, an
individual, as trustees, to form a business trust under the Delaware Business
Trust Act (12 DEL. CODE, ss. 3801 ET SEQ.).
1. NAME. The name of the business trust formed hereby is
The Money Store Auto Trust 1997-4.
2. This Certificate of Trust will be effective __, 199 .
IN WITNESS WHEREOF, the undersigned, being the sole trustees
of the Trust, have executed this Certificate of Trust as of the date first above
written.
BANKERS TRUST (DELAWARE),
not in its individual capacity but
solely as owner trustee of the Trust.
By:________________________________
Name:
Title:
EXHIBIT C
INVESTMENT LETTER
The Money Store, Inc.
TMS Auto Holdings, Inc.
0000 Xxxxxx Xxxxxx
Xxxxx, Xxx Xxxxxx 00000
Bankers Trust (Delaware)
Not in its individual capacity but
solely as Owner Trustee
E.A. Delle Donne Corporate Center
Xxxxxxxxxx Building, 0000 Xxxxxx Xxxx
Xxxxx 000
Xxxxxxxxxx, Xxxxxxxx 00000
Bankers Trust Company
0 Xxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Corporate Trust Agency,
Structured Finance, 16th Floor
Re: THE MONEY STORE AUTO TRUST 1997-4
Ladies and Gentlemen:
In connection with its purchase of certain Trust Certificates (the
"Certificates") of The Money Store Auto Trust 1997-4, the purchaser named below
(the "Purchaser") or, if an investment adviser is executing this Investment
Letter on the Purchaser's behalf, such investment adviser represents, warrants
and certifies that:
(i) it understands that the Certificates are not being and
will not be registered under the Securities Act of
1933, as amended (the "1933 Act"), and are not being
registered or qualified under any state securities or
"blue sky" laws and are being sold to the Purchaser in
a transaction that is exempt from the registration
requirements of the 1933 Act. The Purchaser is an
"accredited investor" as defined in Rule 501(a)(1)-(3)
of the 1933 Act and a sophisticated institutional
investor that is experienced in purchasing securities
similar to the Certificates. The Purchaser is able
to bear the economic risk of investment in the Certificates;
(ii) any information it desired concerning the Certificates,
the issuer thereof or any other matter it deemed
relevant to its decision to purchase the Certificates
has been made available to it. In this regard, it
has carefully reviewed with its counsel and
understands the terms of the Trust Agreement pursuant
to which the Trust was formed and agrees to be bound
by all the terms thereof, including those relating to
restrictions on transfer;
(iii) the Purchaser's purchase of the Certificates would
not cause it to fail to comply fully with all
applicable requirements of each regulatory body having
supervisory or other authority over its operations or
over its purchase of the Certificates. In reaching
its decision to purchase the Certificates, it has
conducted, with its experts and counsel, an
independent analysis of the economic and regulatory
effects of the transaction on the Purchaser based on
the Purchaser's circumstances and has concluded that
the purchase of the Certificates is appropriate for the
Purchaser's circumstances;
(iv) the Purchaser has independently confirmed the federal, state and
local tax consequences of owning the Certificates;
(v) the Purchaser is acquiring the Certificates for its own account,
not as nominee for any other person, and not with a present view
to any distribution or other disposition of the Certificates in
violation of the provisions of the 1933 Act;
(vi) the Purchaser agrees the Certificates must be held
indefinitely by it (and may not be sold, pledged,
hypothecated or in any way disposed of) unless
subsequently registered under the 1933 Act or an
exemption from the registration requirements of the
1933 Act is available and such transaction is exempt
from all applicable state securities or "blue sky"
laws;
(vii) the Purchaser agrees that in the event that at some future time
it wishes to dispose of or exchange the Certificates (such
disposition or exchange not being currently foreseen or
contemplated), it will not transfer or exchange the Certificates
unless:
(A) (1) a letter to substantially the same effect as
this letter is executed and delivered by the purchaser before
the transfer or exchange is consummated, and (2) all offers or
solicitations in connection with the sale, whether directly or
through any agent acting on the Purchaser's behalf, are limited
only to Eligible Purchasers and are not made by means of any
form of general solicitation or general advertising whatsoever;
and
(B) the Certificates are sold in any other transaction
that does not require registration under the 1933 Act and a
satisfactory opinion of counsel is furnished to the Owner
Trustee such effect;
(viii) the Purchaser is not, and is not purchasing for,
or on behalf of, (1) 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 any such plan's
arrangements or account's investment in any such entity.
(ix) the Purchaser understands that the Certificates bear, and will
continue to bear, a legend to substantially the following
effect:
(x) the Purchaser is a United States Person within the meaning of
Section 7701(a)(30) of the Internal Revenue code of 1986, as
amended
THIS TRUST CERTIFICATE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933,
AS AMENDED (THE "ACT"). THE HOLDER HEREOF, BY PURCHASING THIS TRUST CERTIFICATE,
AGREES THAT THIS TRUST CERTIFICATE MAY BE RESOLD, PLEDGED OR OTHERWISE
TRANSFERRED ONLY IN ACCORDANCE WITH ANY APPLICABLE STATE SECURITIES LAWS AND (1)
TO A PERSON WHO THE SELLER REASONABLY BELIEVES IS AN INSTITUTIONAL ACCREDITED
INVESTOR WITHIN THE MEANING OF RULE 501(A)(1)-(3) UNDER THE ACT THAT PURCHASES
FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF AN INSTITUTIONAL ACCREDITED INVESTOR,
OR (2) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE ACT.
THIS TRUST 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 ARRANGEMENTS OR ACCOUNT'S INVESTMENT IN SUCH ENTITIES. FURTHER, THIS
TRUST 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 TRUST CERTIFICATE IS NOT GUARANTEED OR INSURED BY ANY GOVERNMENTAL AGENCY.
"ELIGIBLE PURCHASER" means a corporation, partnership or other entity
which it has reasonable grounds to believe and does believe can make
representations with respect to itself to substantially the same effect as the
representations set forth herein.
Terms not otherwise defined shall have the meanings assigned to them
in the Trust Agreement.
Very truly yours,
_________________________
By: ________________________
(Authorized Officer)
