EXHIBIT 4.2
EXECUTION COPY
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AMENDED AND RESTATED
TRUST AGREEMENT
among
TRIAD FINANCIAL SPECIAL PURPOSE LLC
Depositor,
TRIAD FINANCIAL CORPORATION
Administrator
and
WILMINGTON TRUST COMPANY
Owner Trustee
Dated as of October 29, 2003
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TABLE OF CONTENTS
ARTICLE I. DEFINITIONS....................................................................................... 1
SECTION 1.1. Capitalized Terms........................................................................ 1
SECTION 1.2. Other Definitional Provisions............................................................ 2
ARTICLE II. ORGANIZATION..................................................................................... 3
SECTION 2.1. Name .................................................................................... 3
SECTION 2.2. Office .................................................................................. 3
SECTION 2.3. Purposes and Powers...................................................................... 3
SECTION 2.4. Appointment of Owner Trustee............................................................. 4
SECTION 2.5. Initial Capital Contribution of Trust Estate............................................. 4
SECTION 2.6. Declaration of Trust..................................................................... 4
SECTION 2.7. Title to Trust Property.................................................................. 5
SECTION 2.8. Situs of Trust........................................................................... 5
SECTION 2.9. Representations and Warranties of the Depositor.......................................... 5
SECTION 2.10.Representations and Warranties of the Administrator...................................... 6
SECTION 2.11.Covenants of the Certificateholder....................................................... 7
SECTION 2.12.Federal Income Tax Treatment of the Trust................................................ 8
ARTICLE III. CERTIFICATE AND TRANSFER OF INTEREST............................................................ 8
SECTION 3.1. Ownership ............................................................................... 8
SECTION 3.2. The Certificate.......................................................................... 8
SECTION 3.3. Authentication of Certificate............................................................ 9
SECTION 3.4. Registration of Transfer and Exchange of Certificate..................................... 9
SECTION 3.5. Mutilated, Destroyed, Lost or Stolen Certificates........................................ 10
SECTION 3.6. Persons Deemed Certificateholders........................................................ 11
SECTION 3.7. Maintenance of Office or Agency.......................................................... 11
SECTION 3.8. Disposition in Whole But Not in Part..................................................... 11
SECTION 3.9. ERISA Restrictions....................................................................... 11
ARTICLE IV. VOTING RIGHTS AND OTHER ACTIONS.................................................................. 11
SECTION 4.1. Prior Notice to Holder with Respect to Certain Matters................................... 11
SECTION 4.2. Action by Certificateholder with Respect to Certain Matters.............................. 12
SECTION 4.3. Restrictions on Certificateholder's Power................................................ 12
SECTION 4.4. Rights of Security Insurer............................................................... 13
ARTICLE V. AUTHORITY AND DUTIES OF OWNER TRUSTEE............................................................. 13
SECTION 5.1. General Authority........................................................................ 13
SECTION 5.2. General Duties........................................................................... 13
SECTION 5.3. Action upon Instruction.................................................................. 14
SECTION 5.4. No Duties Except as Specified in this Agreement or in Instructions....................... 14
SECTION 5.5. No Action Except under Specified Documents or Instructions............................... 15
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SECTION 5.6. RESTRICTIONS........................................................................... 15
ARTICLE VI. CONCERNING THE OWNER TRUSTEE..................................................................... 15
SECTION 6.1. Acceptance of Trusts and Duties........................................................ 15
SECTION 6.2. Furnishing of Documents................................................................ 17
SECTION 6.3. Representations and Warranties......................................................... 17
SECTION 6.4. Reliance; Advice of Counsel............................................................ 17
SECTION 6.5. Not Acting in Individual Capacity...................................................... 18
SECTION 6.6. Owner Trustee Not Liable for Certificate or Receivables................................ 18
SECTION 6.7. Owner Trustee May Own Notes............................................................ 18
SECTION 6.8. Payments from Owner Trust Estate....................................................... 18
SECTION 6.9. Doing Business in Other Jurisdictions.................................................. 19
ARTICLE VII. COMPENSATION OF OWNER TRUSTEE................................................................... 19
SECTION 7.1. Owner Trustee's Fees and Expenses...................................................... 19
SECTION 7.2. Indemnification........................................................................ 19
SECTION 7.3. Payments to the Owner Trustee.......................................................... 20
SECTION 7.4. Non-recourse Obligations............................................................... 20
ARTICLE VIII. TERMINATION OF TRUST AGREEMENT................................................................. 20
SECTION 8.1. Termination of Trust Agreement......................................................... 20
ARTICLE IX. SUCCESSOR OWNER TRUSTEES AND ADDITIONAL OWNER TRUSTEES........................................... 21
SECTION 9.1. Eligibility Requirements for Owner Trustee............................................. 21
SECTION 9.2. Resignation or Removal of Owner Trustee................................................ 21
SECTION 9.3. Successor Owner Trustee................................................................ 22
SECTION 9.4. Merger or Consolidation of Owner Trustee............................................... 23
SECTION 9.5. Appointment of Co-Trustee or Separate Trustee.......................................... 23
ARTICLE X. MISCELLANEOUS..................................................................................... 24
SECTION 10.1. Supplements and Amendments............................................................. 24
SECTION 10.2. No Legal Title to Owner Trust Estate in Certificateholder.............................. 25
SECTION 10.3. Limitations on Rights of Others........................................................ 25
SECTION 10.4. Notices. 26
SECTION 10.5. Severability........................................................................... 27
SECTION 10.6. Separate Counterparts.................................................................. 27
SECTION 10.7. Assignments............................................................................ 27
SECTION 10.8. No Recourse............................................................................ 27
SECTION 10.9. No Petition............................................................................ 27
SECTION 10.10. Headings............................................................................... 27
SECTION 10.11. GOVERNING LAW.......................................................................... 27
SECTION 10.12. Administrator.......................................................................... 28
EXHIBITS
EXHIBIT A FORM OF CERTIFICATE
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EXHIBIT B FORM OF CERTIFICATE OF TRUST
EXHIBIT C FORM OF CERTIFICATE AS TO INITIAL PURCHASE
EXHIBIT D FORM OF QUALIFIED INSTITUTIONAL BUYER TRANSFEREE'S
CERTIFICATE
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This AMENDED AND RESTATED TRUST AGREEMENT dated as of October
29, 2003 among TRIAD FINANCIAL SPECIAL PURPOSE LLC, a Delaware limited liability
company (the "Depositor"), TRIAD FINANCIAL CORPORATION, as sponsor of the Trust
and Administrator (the "Administrator") and WILMINGTON TRUST COMPANY, a Delaware
banking corporation, as Owner Trustee, (the "Owner Trustee") amends and restates
in its entirety that certain Trust Agreement dated as of August 5, 2003 between
the Depositor and the Owner Trustee.
ARTICLE I.
Definitions
SECTION 1.1. Capitalized Terms. For all purposes of this
Agreement, the following terms will have the meanings set forth below:
"Administrator" means Triad, as the Administrator of the
Trust.
"Agreement" means this Trust Agreement, as the same may be
amended and supplemented from time to time.
"Benefit Plan" has the meaning assigned to such term in
Section 3.9.
"Certificate" means a trust certificate evidencing the
beneficial interest of a Certificateholder in the Trust, substantially in the
form of Exhibit A attached hereto.
"Certificateholder" or "Holder" means the person in whose name
a Certificate is registered on the Certificate Register, initially Triad
Financial Special Purpose LLC.
"Certificate of Trust" means the Certificate of Trust in the
form of Exhibit B to be filed for the Trust pursuant to Section 3810(a) of the
Statutory Trust Statute.
"Certificate Register" and "Certificate Registrar" mean the
register mentioned and the registrar appointed pursuant to Section 3.4.
"Code" means the Internal Revenue Code of 1986, as amended
from time to time, and Treasury Regulations promulgated thereunder.
"Corporate Trust Office" means, with respect to the Owner
Trustee, the principal corporate trust office of the Owner Trustee located at
Xxxxxx Square North, 0000 Xxxxx Xxxxxx Xxxxxx, Xxxxxxxxxx, Xxxxxxxx 00000, or at
such other address as the Owner Trustee may designate by notice to the
Certificateholder, or the principal corporate trust office of any successor
Owner Trustee (the address of which the successor owner trustee will notify the
Certificateholder).
"Depositor" means Triad Financial Special Purpose LLC, a
Delaware limited liability company.
"ERISA" has the meaning assigned to such term in Section 3.9.
"Expenses" has the meaning assigned to such term in Section
7.2.
"Indemnified Parties" has the meaning assigned to such term in
Section 7.2.
"Owner Trust Estate" means 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 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" means Wilmington Trust Company, 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" means with respect to any Distribution Date, the
close of business on the last Business Day immediately preceding such
Distribution Date.
"Responsible Officer" means, with respect to the Owner
Trustee, any officer within the Corporate Trust Office of the Owner Trustee with
direct responsibility for the administration of the Trust and also, with respect
to a particular matter, any other officer to whom such matter is referred
because of such officer's knowledge of and familiarity with the particular
subject.
"Sale and Servicing Agreement" means the Sale and Servicing
Agreement dated as of October 1, 2003, among the Trust, the Depositor, Triad and
the Indenture Trustee, as the same may be amended and supplemented from time to
time.
"Secretary of State" means the Secretary of State of the State
of Delaware.
"Security Insurer" means MBIA Insurance Corporation, or its
successor in interest.
"Statutory Trust Statute" means Chapter 38 of Title 12 of the
Delaware Code, 12 Del. Code Section 3801 et seq. as the same may be amended from
time to time.
"Treasury Regulations" means regulations, including proposed
or temporary regulations, promulgated under the Code. References herein to
specific provisions of proposed or temporary regulations will include analogous
provisions of final Treasury Regulations or other successor Treasury
Regulations.
"Triad" means Triad Financial Corporation.
"Trust" means the trust established by this Agreement.
SECTION 1.2. Other Definitional Provisions.
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(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 will 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, will 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 will
control.
(d) The words "hereof," "herein," "hereunder" and words
of similar import when used in this Agreement will 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"
will 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 "Triad Automobile Receivables Trust 2003-B," 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 will 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 Certificateholder.
SECTION 2.3. Purposes and Powers.
(a) The purpose of the Trust is, and the Trust will have
the power and authority, to engage in the following activities:
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(i) to issue the Notes pursuant to the Indenture
and the Certificate pursuant to this
Agreement, and to sell the Notes to the
Depositor;
(ii) to assign, grant, transfer, pledge, mortgage
and convey the Trust Estate to the Indenture
Trustee pursuant to the Indenture for the
benefit of the Security Insurer and on
behalf of the Noteholders and to hold,
manage and distribute to the
Certificateholder 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;
(iii) to enter into and perform its obligations
under the Basic Documents to which it is a
party;
(iv) 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
(v) 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
Certificateholder and the Noteholders.
The Trust is hereby authorized to engage in the foregoing activities. The Trust
will 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
Owner Trustee hereby acknowledges prior receipt in trust from the Depositor of
the sum of $1,000 which contribution will constitute the initial Owner Trust
Estate. The Administrator will 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 Holder, subject
to the obligations of the Trust under the Basic Documents. It is the intention
of the parties hereto that the Trust constitute a statutory trust under the
Statutory Trust Statute and that this Agreement constitute the governing
instrument of such statutory trust. Effective as of the date hereof, the Owner
Trustee will have all rights, powers and duties set forth herein and to the
extent not inconsistent herewith, in the Statutory Trust Statute with respect to
accomplishing the purposes of the Trust. The Owner Trustee will file the
Certificate of Trust with the Secretary of State.
The Holder will not have any personal liability for any
liability or obligation of the Trust.
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SECTION 2.7. Title to Trust Property.
(a) Legal title to all the Owner Trust Estate will 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 will be deemed
to be vested in the Owner Trustee, a co-trustee and/or a separate trustee, as
the case may be. If any portion of the Owner Trust Estate is deemed vested in
the Owner Trustee, a co-trustee and/or separate trustee, the Owner Trustee, upon
having actual knowledge thereof, will immediately notify the Indenture Trustee,
the Servicer and the Administrator, and the Administrator will cause to be filed
such UCC financing statements and related filing documents or writings as are
necessary to maintain the Indenture Trustee's security interest in the Owner
Trust Estate.
(b) The Holder will not have legal title to any part of
the Trust Property. The Holder is entitled to receive distributions with respect
to its undivided ownership interest therein only in accordance with Article
VIII. No transfer, by operation of law or otherwise, of any right, title or
interest by the Certificateholder of its ownership interest in the Owner Trust
Estate will operate to terminate this Agreement or the trusts hereunder or
entitle any transferee to an accounting or to the transfer to it of legal title
to any part of the Trust Property.
SECTION 2.8. Situs of Trust. The Trust will be located in the
State of Delaware. All bank accounts maintained by the Owner Trustee on behalf
of the Trust will 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 will not
have any employees in any state other than Delaware; provided, however, that
nothing herein will restrict or prohibit the Owner Trustee, 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
located in Delaware.
SECTION 2.9. 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 executing
the Certificate 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 limited liability company 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 limited liability company 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.
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(c) Power and Authority. The Depositor has the power and
authority to execute and deliver this Agreement and to carry out its terms; the
Depositor has full power and authority to sell and assign the property to be
sold and assigned to and deposited with the Trust and the Depositor has duly
authorized such sale and assignment and deposit to the Trust by all necessary
action; and the execution, delivery and performance of this Agreement has been
duly authorized by the Depositor by all necessary 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
limited liability agreement 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 Certificate 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
characteristics of the Certificate.
SECTION 2.10. Representations and Warranties of the
Administrator. The Administrator, as sponsor of the Trust, assumes all rights
and obligations under Section 2(a)-4 of the Securities Act of 1933, as amended.
The Administrator makes the following representations and warranties on which
the Owner Trustee relies in accepting the Owner Trust Estate in trust and
executing the Certificate and upon which the Security Insurer relies in issuing
the Note Policy.
(a) Organization and Good Standing. The Administrator is
duly organized and validly existing as a California 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.
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(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 Administrator has the
corporate power and authority to execute and deliver this Agreement and to carry
out its terms; the Administrator has full power and authority to sell and assign
the property to be sold and assigned to and deposited with the Trust and the
Administrator 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 Administrator 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 Administrator, or any material
indenture, agreement or other instrument to which the Administrator 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 Administrator's knowledge, any order,
rule or regulation applicable to the Administrator of any court or of any
federal or state regulatory body, administrative agency or other governmental
instrumentality having jurisdiction over the Administrator 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 Certificate 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 Certificate.
SECTION 2.11. Covenants of the Certificateholder. The
Certificateholder agrees:
(a) to be bound by the terms and conditions of the
Certificate of which the Holder is the owner and of this Agreement, including
any supplements or amendments hereto and to perform the obligations of a Holder
as set forth therein or herein, in all respects as if it
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were a signatory hereto. This undertaking is made for the benefit of the Trust,
the Owner Trustee and the Security Insurer; and
(b) until the completion of the events specified in
Section 8.1(d), not to, 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 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 2.12. Federal Income Tax Treatment of the Trust.
(a) For so long as the Trust has a single owner for
federal income tax purposes, it will, pursuant to Treasury Regulations
promulgated under section 7701 of the Code, be disregarded as an entity distinct
from the Certificateholder for all federal income tax purposes. Accordingly, for
federal income tax purposes, the Certificateholder will be treated as (i) owning
all assets owned by the Trust, (ii) having incurred all liabilities incurred by
the Trust, and (iii) all transactions between the Trust and the
Certificateholder will be disregarded.
(b) Neither the Owner Trustee nor any Certificateholder
will, under any circumstances, and at any time, make an election on IRS Form
8832 or otherwise, to classify the Trust as an association taxable as a
corporation for federal, state or any other applicable tax purpose.
(c) Notwithstanding Section 3.8, in the event that the
Trust has two equity owners for federal income tax purposes, the Trust will be
treated as a partnership. At any such time that the Trust has two equity owners,
this Agreement will be amended, in accordance with Section 10.1 herein, and
appropriate provisions will be added so as to provide for treatment of the Trust
as a partnership.
ARTICLE III.
Certificate and Transfer of Interest
SECTION 3.1. Ownership. Upon the formation of the Trust by the
contribution by the Depositor pursuant to Section 2.5 and until the issuance of
the Certificate to the initial Certificateholder, the Depositor will be the sole
beneficiary of the Trust.
SECTION 3.2. The Certificate. The Certificate will be executed
on behalf of the Trust by manual or facsimile signature of an authorized officer
of the Owner Trustee. A Certificate bearing the manual or facsimile signatures
of individuals who were, at the time when such signatures will have been
affixed, authorized to sign on behalf of the Trust, will be validly issued and
entitled to the benefit of this Agreement, notwithstanding that such individuals
or any of them will have ceased to be so authorized prior to the authentication
and delivery of such Certificate or did not hold such offices at the date of
authentication and delivery of such
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Certificate. A transferee of a Certificate will become a Certificateholder, and
will be entitled to the rights and subject to the obligations of a
Certificateholder hereunder, upon due registration of such Certificate in such
transferee's name pursuant to Section 3.4. The Certificate will be issuable in
minimum denominations no less than 5% of the certificate balance.
SECTION 3.3. Authentication of Certificate. Concurrently with
the initial sale of the Receivables to the Trust pursuant to the Sale and
Servicing Agreement, the Owner Trustee will cause the Certificate to be executed
on behalf of the Trust, authenticated and delivered to or upon the written order
of the Depositor, signed by its chairman of the board, its president or any vice
president, its treasurer or any assistant treasurer without further action by
the Depositor, in authorized denominations. No Certificate will entitle its
holder to any benefit under this Agreement, or will be valid for any purpose,
unless there will appear on such Certificate a certificate of authentication
substantially in the form set forth in Exhibit A, executed by the Owner Trustee,
by manual signature; such authentication will constitute conclusive evidence
that such Certificate is duly authenticated and delivered hereunder. The
Certificate will be dated the date of its authentication.
SECTION 3.4. Registration of Transfer and Exchange of
Certificate. The Certificate Registrar will keep or cause to be kept, at the
office or agency maintained pursuant to Section 3.7, a Certificate Register in
which, subject to such reasonable regulations as it may prescribe, the Owner
Trustee will provide for the registration of the Certificate and of transfers
and exchanges of the Certificate as herein provided. The Owner Trustee will be
the initial Certificate Registrar.
The Certificateholder will provide the Certificate Registrar
and the Indenture Trustee with the name and address of the Certificateholder on
the Closing Date. Upon any transfers of the Certificate, the Certificate
Registrar will notify the Indenture Trustee of the name and address of the
transferee in writing, by facsimile, on the day of such transfer.
Upon surrender for registration of transfer of the Certificate
at the office or agency maintained pursuant to Section 3.7, the Owner Trustee
will execute, authenticate and deliver, in the name of the designated
transferee, a new Certificate dated the date of authentication by the Owner
Trustee or any authenticating agent.
A Certificate presented or surrendered for registration of
transfer or exchange will be accompanied by 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.
Each Certificate surrendered for registration of transfer or exchange will be
canceled and subsequently disposed of by the Owner Trustee in accordance with
its customary practice.
No service charge will be made for any registration of
transfer or exchange of the Certificate, but the Owner Trustee or the
Certificate Registrar may require payment of a sum sufficient to cover any
expense, tax or governmental charge that may be imposed in connection with any
transfer or exchange of the Certificate.
To the fullest extent permitted by applicable law, no sale,
pledge or other transfer of a Certificate will be made unless (I) such sale,
pledge or other transfer (i) is made pursuant to
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an effective registration statement under the Securities Act and any applicable
state securities laws or (ii) is exempt from the registration requirements under
the Securities Act and such state securities laws and (II) such sale, pledge or
other transfer is made to a Person that satisfies the requirements of paragraph
(a)(2)(ii) of Rule 3a-7 as then in effect or any successor rule ("Rule 3a-7")
under the Investment Company Act. Each prospective purchaser of the Certificate
in the initial sale by the Issuer on the Closing Date will deliver completed and
duly executed transferee's certificate (in the form of Exhibit C) to the Owner
Trustee. Each prospective purchaser of a Certificate after the Closing Date will
deliver a completed and duly executed transferee's certificate (in the form of
Exhibit D for "qualified institutional buyers"), to the Owner Trustee and to the
Transferor for inspection prior to effecting any requested transfer. The Issuer
and the Owner Trustee may rely conclusively upon the information contained in
any such transferee's certificate in the absence of knowledge to the contrary.
In connection with any transfer (other than (i) the initial purchase of any
Certificate by the initial purchasers who deliver a transferee's certificate in
the form of Exhibit C and (ii) the purchase of any Certificate by a purchaser
who delivers a Transferee's Certificate in the form of Exhibit D), the Owner
Trustee will require an Opinion of Counsel to the effect that such transfer may
be effected without registration under the Securities Act, which Opinion of
Counsel, if so required, will be addressed to the Issuer and the Owner Trustee
and will be secured at the expense of the Holder. The Owner Trustee may rely
upon the representation of any transferee made to the Owner Trustee, and upon
such Opinion of Counsel, and will be fully protected in so doing. Any
Certificate Owners will be deemed to have agreed to these restrictions on
transfer.
In order to preserve the exemption for resales and transfers provided
by Rule 144A under the Securities Act, the Issuer will provide to any
Certificateholder and any prospective purchaser designated by such
Certificateholder, upon request of such Certificateholder or such prospective
purchaser, such information required by Rule 144A as will enable the resale of
such Certificate to be made pursuant to Rule 144A. The Owner Trustee will
cooperate with the Issuer in providing the Issuer such information in its
possession regarding the Certificate, the Receivables and other matters
regarding the Certificate as the Issuer will reasonably request to meet its
obligations under the preceding sentence.
SECTION 3.5. Mutilated, Destroyed, Lost or Stolen
Certificates. If (a) any mutilated Certificate will be surrendered to the
Certificate Registrar, or if the Certificate Registrar will receive evidence to
its satisfaction of the destruction, loss or theft of any Certificate and (b)
there will be delivered to the Certificate Registrar and the Owner Trustee such
security or indemnity as may be required by them to save each of them harmless,
then in the absence of notice that such Certificate has been acquired by a bona
fide purchaser, the Owner Trustee on behalf of the Trust will execute, and the
Owner Trustee will authenticate and deliver, in exchange for or in lieu of any
such mutilated, destroyed, lost or stolen Certificate, a new Certificate of like
class, tenor and denomination. In connection with the issuance of any new
Certificate under this Section, the Owner Trustee or the Certificate Registrar
may require the payment of a sum sufficient to cover any expense, tax or other
governmental charge that may be imposed in connection therewith. Any duplicate
Certificate issued pursuant to this Section will constitute conclusive evidence
of an ownership interest in the Trust, as if originally issued, whether or not
the lost, stolen or destroyed Certificate will be found at any time.
10
SECTION 3.6. Persons Deemed Certificateholders. Every Person
by virtue of becoming a Certificateholder in accordance with this Agreement is
deemed to be bound by the terms of this Agreement. Prior to due presentation of
the 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 Certificate will be registered in the Certificate Register as the owner
of such Certificate for the purpose of receiving distributions pursuant to the
Sale and Servicing Agreement 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
will be bound by any notice to the contrary.
SECTION 3.7. Maintenance of Office or Agency. The Owner
Trustee will maintain an office or offices or agency or agencies where the
Certificate may be surrendered for registration of transfer or exchange and
where notices and demands to or upon the Owner Trustee in respect of the
Certificate and the Basic Documents may be served. The Owner Trustee initially
designates its principal Corporate Trust Office for such purposes. The Owner
Trustee will give prompt written notice to the Depositor, the Certificateholder
and (unless an Insurer Default has occurred and is continuing) the Security
Insurer of any change in the location of the Certificate Register or any such
office or agency.
SECTION 3.8. Disposition in Whole But Not in Part. The
Certificate may be transferred in whole but not in part. To the fullest extent
permitted by applicable law, any attempted transfer of the Certificate that
would divide the ownership of the Trust Estate is void.
SECTION 3.9. ERISA Restrictions. The Certificate may not be
acquired by or for the account of (i) an employee benefit plan (as defined in
Section 3(3) of the Employee Retirement Income Security Act of 1974, as amended
("ERISA")) that is subject to the provisions of Title I of ERISA, (ii) a plan
(as defined in Section 4975(e)(1) of the Code) that is subject to Section 4975
of the Code, or (iii) any entity whose underlying assets include assets of a
plan described in (i) or (ii) above by reason of such plan's investment in the
entity (including, without limitation, an insurance company general account)
(each, a "Benefit Plan"). By accepting and holding its beneficial ownership
interest in its Certificate, the Holder thereof is deemed to have represented
and warranted that it is not a Benefit Plan.
ARTICLE IV.
Voting Rights and Other Actions
SECTION 4.1. Prior Notice to Holder with Respect to Certain
Matters. With respect to the following matters, the Owner Trustee will not take
action unless at least 30 days before the taking of such action, the Owner
Trustee will have notified the Certificateholder in writing of the proposed
action and the Certificateholder will not have notified the Owner Trustee in
writing prior to the 30th day after such notice is given that the
Certificateholder has withheld consent or provided alternative direction:
11
(a) the election by the Trust to file an amendment to the
Certificate of Trust (unless such amendment is required to be filed under the
Statutory Trust Statute or unless such amendment would not materially and
adversely affect the interests of the Holder);
(b) the amendment of the Indenture by a supplemental
indenture in circumstances where the consent of any Noteholder is required;
(c) the amendment of the Indenture by a supplemental
indenture in circumstances where the consent of any Noteholder is not required
and such amendment materially adversely affects the interest of the
Certificateholder; or
(d) except pursuant to Section 12.1(b) of the Sale and
Servicing Agreement, 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 Certificateholder.
The Owner Trustee will notify the Certificateholder in writing of any
appointment of a successor Note Registrar or Indenture Trustee within five
Business Days after receipt of notice thereof.
SECTION 4.2. Action by Certificateholder with Respect to
Certain Matters. The Owner Trustee will not have the power, except upon the
direction of the Certificateholder or the Security Insurer in accordance with
the Basic Documents, to (a) remove the Servicer under the Sale and Servicing
Agreement pursuant to Section 9.2 thereof or (b) except as expressly provided in
the Basic Documents, sell the Receivables after the termination of the
Indenture. The Owner Trustee will take the actions referred to in the preceding
sentence only upon written instructions signed by the Certificateholder and the
furnishing of indemnification satisfactory to the Owner Trustee by the
Certificateholder.
SECTION 4.3. Restrictions on Certificateholder's Power.
(a) The Certificateholder will not direct the Owner
Trustee to take or refrain from taking any action if such action or inaction
would be contrary to any obligation of the Trust or the Owner Trustee under this
Agreement or any of the Basic Documents or would be contrary to Section 2.3 nor
will the Owner Trustee be obligated to follow any such direction, if given.
(b) The Certificateholder will 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 Certificateholder is
the Instructing Party pursuant to Section 5.3 and unless the Certificateholder
previously will have given to the Owner Trustee a written notice of default and
of the continuance thereof, as provided in this Agreement, and also unless
Certificateholder will 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 will 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, has 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
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Section 5.3. For the protection and enforcement of the provisions of this
Section, the Certificateholder and the Owner Trustee are entitled to such relief
as can be given either at law or in equity.
SECTION 4.4. 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 has occurred and
is continuing), the Owner Trustee will 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
statutory trust or other entity (other than in accordance with Section 3.10 of
the Indenture) or (iv) amend the Certificate of Trust (other than as may be
required by the Statutory Trust Statute).
ARTICLE V.
Authority and Duties of Owner Trustee
SECTION 5.1. 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 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 Certificateholder will approve as
evidenced conclusively by the Owner Trustee's execution thereof, and on behalf
of the Trust, to direct the Indenture Trustee to authenticate and deliver Class
A-1 Notes in the aggregate principal amount of $193,000,000, Class A-2 Notes in
the aggregate principal amount of $280,000,000, Class A-3 Notes in the aggregate
principal amount of $210,000,000, Class A-4 Notes in the aggregate principal
amount of $249,000,000 and Class B Notes in the aggregate principal amount of
$92,700,567.30. In addition to the foregoing, the Owner Trustee is authorized,
but will 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.
SECTION 5.2. General Duties. It will 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 to administer the Trust in the
interest of the Holder, subject to the Basic Documents and in accordance with
the provisions of this Agreement. Notwithstanding the foregoing, the Owner
Trustee is deemed to have discharged its duties and responsibilities hereunder
and under the Basic Documents to the extent the Servicer or Administrator has
agreed to perform any act or to discharge any duty of the Trust or the Owner
Trustee hereunder or under any Basic Document, and the Owner Trustee will not be
liable for the default or failure of the Servicer or Administrator to carry out
its obligations.
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SECTION 5.3. Action upon Instruction.
(a) Subject to Article IV, the Security Insurer (so long
as any Class A Notes are outstanding and an Insurer Default will not have
occurred and be continuing) or the Certificateholder (if an Insurer Default has
occurred and is continuing or if no Class A Notes are outstanding) (the
"Instructing Party") has the exclusive right to direct the actions of the Owner
Trustee in the management of the Trust. The Instructing Party will ensure that
such instructions are not inconsistent with the express terms set forth herein
or in any Basic Document. The Instructing Party will not instruct the Owner
Trustee in a manner inconsistent with this Agreement or the Basic Documents.
(b) The Owner Trustee will not be required to take any
action hereunder or under any Basic Document if the Owner Trustee has reasonably
determined, or has 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 will promptly give notice (in
such form as will 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 will not be
liable on account of such action to any Person. If the Owner Trustee will 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 will be under no duty to, take
or refrain from taking such action, not inconsistent with this Agreement or the
Basic Documents, as it will deem to be in the best interests of the
Certificateholder, and will have no liability to any Person for such action or
inaction.
(d) If 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 if 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 will 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 received, the Owner Trustee will not be
liable, on account of such action or inaction, to any Person. If the Owner
Trustee will 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 will be
under no duty to, take or refrain from taking such action, not inconsistent with
this Agreement or the Basic Documents, as it will deem to be in the best
interests of the Certificateholder, and will have no liability to any Person for
such action or inaction.
SECTION 5.4. No Duties Except as Specified in this Agreement
or in Instructions. The Owner Trustee will not have any duty or obligation to
manage, make any
14
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 5.3; and no implied duties or obligations will be
read into this Agreement or any Basic Document against the Owner Trustee. The
Owner Trustee will 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 filing for the Trust with the Securities and
Exchange Commission 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 5.5. No Action Except under Specified Documents or
Instructions. The Owner Trustee will 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
or (iii) in accordance with any document or instruction delivered to the Owner
Trustee pursuant to Section 5.3.
SECTION 5.6. Restrictions. The Owner Trustee will 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 Certificateholder will not direct the Owner Trustee to take action
that would violate the provisions of this Section.
ARTICLE VI.
Concerning the Owner Trustee
SECTION 6.1. 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 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 will not be answerable or
accountable hereunder or under any Basic Document under any circumstances,
except (i) for its own willful misconduct, bad faith or gross negligence, (ii)
in the case of the inaccuracy of any representation or warranty contained in
Section 6.3 expressly made by the Owner Trustee, (iii) for liabilities arising
from the failure of the Owner Trustee to perform obligations expressly
undertaken by it in the last sentence of Section 5.4 hereof, (iv) for taxes,
fees or other charges on, based on or measured by, any fees, commissions or
compensation received by the Owner Trustee. In particular, but not by way of
limitation (and subject to the exceptions set forth in the preceding sentence):
15
(a) the Owner Trustee will not be liable for any error of
judgment made by a Responsible Officer of the Owner Trustee;
(b) the Owner Trustee will not be liable with respect to
any action taken or omitted to be taken by it in accordance with the
instructions of the Instructing Party, the Servicer or the Certificateholder;
(c) no provision of this Agreement or any Basic Document
will 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 has 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 will 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 will 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 Certificate, and the Owner Trustee will in
no event assume or incur any liability, duty or obligation to the Security
Insurer, Trustee, Indenture Trustee, any Noteholder or to any Certificateholder,
other than as expressly provided for herein;
(f) the Owner Trustee will not be liable for the default
or misconduct of the Security Insurer, the Administrator, the Indenture Trustee,
or the Servicer under any of the Basic Documents or otherwise and the Owner
Trustee has no obligation or liability to perform the obligations under this
Agreement or the Basic Documents that are required to be performed by the
Administrator, the Indenture Trustee or the Servicer under the Sale and
Servicing Agreement; and
(g) the Owner Trustee will 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 the Instructing Party or the Certificateholder, unless such
Instructing Party or Certificateholder has 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 will not be construed as a duty, and the Owner Trustee will not
be answerable for other than its gross negligence, bad faith or willful
misconduct in the performance of any such act.
With respect to the Security Insurer or Instructing Party, the Owner
Trustee undertakes to perform or observe only such of the covenants and
obligations of the Owner Trustee as are expressly set forth in the Agreement,
and no implied covenants or obligations with respect to the Security Insurer or
Instructing Party shall be read into this Agreement or the other Basic
16
Documents against the Owner Trustee. The Owner Trustee shall not be deemed to
owe any fiduciary duty to the Security Insurer or Instructing Party, and shall
not be liable to any such person for the failure of the Trust to perform its
obligations to such persons other than as a result of the gross negligence or
willful misconduct of the Owner Trustee in the performance of its express
obligations under this Agreement.
SECTION 6.2. Furnishing of Documents. The Owner Trustee will
furnish to the Certificateholder 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 6.3. Representations and Warranties. The Owner Trustee
hereby represents and warrants to the Depositor, the Holder and the Security
Insurer (which will have relied on such representations and warranties in
issuing the Note Policy), 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 6.4. Reliance; Advice of Counsel.
(a) The Owner Trustee will 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 will 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
17
entered into with any of them, and the Owner Trustee will not be liable for the
conduct or misconduct of such agents or attorneys if such agents or attorneys
will have been selected by the Owner Trustee with reasonable care, and (ii) may
consult with counsel, accountants and other skilled persons to be selected in
good faith. The Owner Trustee will not be liable for anything done, suffered or
omitted in good faith by it in accordance with the opinion or advice of any such
counsel, accountants or other such persons and according to such opinion not
contrary to this Agreement or any Basic Document.
SECTION 6.5. Not Acting in Individual Capacity. Except as
provided in this Article VI, in accepting the trust hereby created Wilmington
Trust Company acts solely as Owner Trustee hereunder and not in its individual
capacity and all Persons having any claim against the Owner Trustee by reason of
the transactions contemplated by this Agreement or any Basic Document will look
only to the Owner Trust Estate for payment or satisfaction thereof.
SECTION 6.6. Owner Trustee Not Liable for Certificate or
Receivables. The recitals contained herein and in the Certificate (other than
the signature and countersignature of the Owner Trustee on the Certificate) will
be taken as the statements of the Certificateholder 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 Certificate (other than the signature and
countersignature of the Owner Trustee on the Certificate) or the Notes, or of
any Receivable or related documents. The Owner Trustee will 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 Certificateholder 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,
the Servicer or any other Person with any warranty or representation made under
any Basic Document or in any related document or the accuracy of any such
warranty or representation or any action of the Indenture Trustee or the
Servicer or any subservicer taken in the name of the Owner Trustee.
SECTION 6.7. Owner Trustee May Own Notes. The Owner Trustee in
its individual or any other capacity may become the owner or pledgee of the
Notes and may deal with the Depositor, the Indenture Trustee and the Servicer in
banking transactions with the same rights as it would have if it were not Owner
Trustee.
SECTION 6.8. 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 will be made only from the
income and proceeds of the Owner Trust Estate and only to the extent that the
Owner Trust will have received income or proceeds from the Owner Trust Estate to
make such payments in accordance with the terms hereof. Wilmington Trust
Company, or any successor thereto, in its individual capacity, will not be
18
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 6.9. Doing Business in Other Jurisdictions.
Notwithstanding anything contained herein to the contrary, neither Wilmington
Trust Company or any successor thereto, nor the Owner Trustee will 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 9.5 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 Wilmington Trust Company (or
any successor thereto); or (iii) subject Wilmington Trust Company (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 Wilmington Trust Company (or any successor
thereto) or the Owner Trustee, as the case may be, contemplated hereby.
ARTICLE VII.
Compensation of Owner Trustee
SECTION 7.1. Owner Trustee's Fees and Expenses. The Owner
Trustee will receive as compensation for its services hereunder such fees as
have been separately agreed upon before the date hereof between Triad and the
Owner Trustee, and the Owner Trustee will be entitled to be reimbursed by Triad
for its other reasonable expenses hereunder, including the reasonable
compensation, expenses and disbursements of such agents, representatives,
experts and counsel as the Owner Trustee may employ in connection with the
exercise and performance of its rights and its duties hereunder and under the
Basic Documents.
SECTION 7.2. Indemnification. Triad will indemnify the Owner
Trustee and its officers, directors, employees, successors, assigns, agents and
servants (collectively, the "Indemnified Parties") from and against, any and all
costs, expenses, losses, damages, claims and liabilities (collectively,
"Expenses"), arising out of or resulting from this Agreement, the Basic
Documents, the Owner Trust Estate, the administration of the Owner Trust Estate
or the action or inaction of the Owner Trustee hereunder, except that Triad will
not be liable for or required to indemnify the Owner Trustee from and against
Expenses (i) arising or resulting from any of the matters described in the third
sentence of Section 6.1 and (ii) constituting federal, state or other taxes
arising out of any fees paid to the Owner Trustee pursuant to the Basic
Documents.
Indemnification under this Section 7.2 will include reasonable
fees and expenses of counsel and expenses of litigation and the indemnities
contained in this Section and the rights under Section 7.1 will 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 will be subject to the approval of Triad which approval will not be
unreasonably withheld.
19
SECTION 7.3. Payments to the Owner Trustee. Any amounts paid
to the Owner Trustee pursuant to this Article VII will be deemed not to be a
part of the Owner Trust Estate immediately after such payment.
SECTION 7.4. 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 will be with recourse to the Owner Trust Estate only and
specifically will be without recourse to the assets of the Holder.
ARTICLE VIII.
Termination of Trust Agreement
SECTION 8.1. Termination of Trust Agreement.
(a) This Agreement and the Trust will terminate in
accordance with Section 3808 of the Statutory Trust Statute 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 10.1 of the Sale and Servicing
Agreement) and the subsequent distribution of amounts in respect of such
Receivables as provided in the Basic Documents, or (ii) the payment to the
Certificateholder of all amounts required to be paid to it pursuant to this
Agreement and the payment to the Security Insurer of all amounts payable or
reimbursable to it pursuant to the Sale and Servicing Agreement; provided,
however, that the rights to indemnification under Section 7.2 and the rights
under Section 7.1 will survive the termination of the Trust. Triad or the
Servicer will promptly notify the Owner Trustee and the Security Insurer of any
prospective termination pursuant to this Section. The bankruptcy, liquidation,
dissolution, death or incapacity of the Certificateholder will not (x) operate
to terminate this Agreement or the Trust, nor (y) entitle the
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) Neither the Depositor nor the Certificateholder will
be entitled to revoke or terminate the Trust.
(c) Notice of any termination of the Trust, specifying
the Distribution Date upon which the Certificateholder will surrender the
Certificate to the Indenture Trustee for payment of the final distribution and
cancellation, will be given by the Owner Trustee by letter to the
Certificateholder mailed within five Business Days of receipt of notice of such
termination from the Servicer given pursuant to Section 10.1(c) of the Sale and
Servicing Agreement, stating (i) the Distribution Date upon or with respect to
which final payment of the Certificate will be made upon presentation and
surrender of the Certificate at the office of the Indenture Trustee 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 Certificate at the office
of the Indenture Trustee therein specified. The Owner Trustee will give such
notice to the Indenture Trustee at the time such
20
notice is given to the Certificateholder. Upon presentation and surrender of the
Certificate, the Indenture Trustee will cause to be distributed to the
Certificateholder amounts distributable on such Distribution Date pursuant to
Section 5.7 of the Sale and Servicing Agreement.
If the Certificateholder does not surrender the Certificate
for cancellation within six months after the date specified in the above
mentioned written notice, the Owner Trustee will give a second written notice to
the Certificateholder to surrender the Certificate for cancellation and receive
the final distribution with respect thereto. If within one year after the second
notice the Certificate will 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 Certificateholder concerning surrender of its
Certificate, and the cost thereof will be paid out of the funds and other assets
that will remain subject to this Agreement. Any funds remaining in the Trust
after exhaustion of such remedies will be distributed, subject to applicable
escheat laws, by the Owner Trustee to the Holder.
(d) Upon the completion of the winding up of the Trust in
accordance with Section 3808 of the Statutory Trust Statute and its termination,
the Owner Trustee will cause the Certificate of Trust to be canceled by filing a
certificate of cancellation with the Secretary of State in accordance with the
provisions of Section 3810 of the Statutory Trust Statute.
ARTICLE IX.
Successor Owner Trustees and Additional Owner Trustees
SECTION 9.1. Eligibility Requirements for Owner Trustee. The
Owner Trustee will at all times be a corporation (i) satisfying the provisions
of Section 3807(a) of the Statutory 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 will not have occurred and be continuing. If such
corporation will 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 will 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 will cease to be eligible in accordance with the provisions of
this Section, the Owner Trustee will resign immediately in the manner and with
the effect specified in Section 9.2.
SECTION 9.2. 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 Depositor, the Security Insurer,
the Administrator and the Servicer. Upon receiving such notice of resignation,
the Administrator will promptly appoint a successor Owner Trustee by written
instrument, in duplicate, one copy of which instrument will be delivered to the
resigning Owner Trustee and one copy to the successor Owner Trustee, provided
that the Administrator has 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 has been so appointed and have accepted appointment within 30 days
after the giving of such notice of resignation, the resigning
21
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 will cease to be eligible in
accordance with the provisions of Section 9.1 and will fail to resign after
written request therefor by the Administrator, or if at any time the Owner
Trustee will be legally unable to act, or will be adjudged bankrupt or
insolvent, or a receiver of the Owner Trustee or of its property will be
appointed, or any public officer will take charge or control of the Owner
Trustee or of its property or affairs for the purpose of rehabilitation,
conservation or liquidation, then the Administrator with the consent of the
Security Insurer (so long as an Insurer Default will not have occurred and be
continuing) may remove the Owner Trustee. If the Administrator will remove the
Owner Trustee under the authority of the immediately preceding sentence, the
Administrator will promptly appoint a successor Owner Trustee by written
instrument, in duplicate, one copy of which instrument will 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 will not become effective until acceptance of appointment by the
successor Owner Trustee pursuant to Section 9.3 and payment of all fees and
expenses owed to the outgoing Owner Trustee. The Administrator will provide
notice of such resignation or removal of the Owner Trustee to each of the Rating
Agencies.
SECTION 9.3. Successor Owner Trustee. Any successor Owner
Trustee appointed pursuant to Section 9.2 will execute, acknowledge and deliver
to the Depositor, the Servicer, the Administrator, the Security Insurer 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 will become effective and such successor Owner Trustee, without
any further act, deed or conveyance, will 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 will upon payment of its fees and expenses deliver to the successor
Owner Trustee all documents and statements and monies held by it under this
Agreement; and the Depositor, the Administrator and the predecessor Owner
Trustee will 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 will accept appointment as provided
in this Section unless at the time of such acceptance such successor Owner
Trustee will be eligible pursuant to Section 9.1.
Upon acceptance of appointment by a successor Owner Trustee
pursuant to this Section, the Servicer will mail notice of the successor of such
Owner Trustee to the Certificateholder, the Indenture Trustee, the Noteholders
and the Rating Agencies. If the Servicer will fail to mail such notice within 10
days after acceptance of appointment by the successor Owner Trustee, the
successor Owner Trustee will cause such notice to be mailed at the expense of
the Servicer.
22
SECTION 9.4. 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 will be a party, or any
corporation succeeding to all or substantially all of the corporate trust
business of the Owner Trustee, will be the successor of the Owner Trustee
hereunder, provided such corporation will be eligible pursuant to Section 9.1,
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 will mail notice of such merger or
consolidation to the Rating Agencies.
SECTION 9.5. 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 have the power and will
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 will 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 has occurred and is continuing, to the approval of the Security
Insurer (which approval will not be unreasonably withheld) has the power to make
such appointment. No co-trustee or separate trustee under this Agreement will be
required to meet the terms of eligibility as a successor trustee pursuant to
Section 9.1 and no notice of the appointment of any co-trustee or separate
trustee will be required pursuant to Section 9.3.
Each separate trustee and co-trustee will, 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
will 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 will 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)
will be exercised and performed singly by
such separate trustee or co-trustee, but
solely at the direction of the Owner
Trustee;
23
(ii) no trustee under this Agreement will 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 will 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 will refer to this Agreement and
the conditions of this Article. Each separate trustee and co-trustee, upon its
acceptance of the trusts conferred, will 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 will 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 will die, become incapable of acting, resign or be removed, all of
its estates, properties, rights, remedies and trusts will 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 X.
Miscellaneous
SECTION 10.1. Supplements and Amendments.
(a) This Agreement may be amended by the Depositor, the
Administrator and the Owner Trustee, with the prior written consent of the
Security Insurer (so long as an Insurer Default will 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 Certificateholder, (i) to cure any
ambiguity or defect or (ii) to correct, supplement or modify any provisions in
this Agreement; provided, however, that such action will not, as evidenced by an
Opinion of Counsel which may be based upon a certificate of the Servicer,
adversely affect in any material respect the interests of any Noteholder or
Certificateholder.
(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 will not have occurred and be continuing), by the Depositor, the
Administrator and the Owner Trustee, with prior written notice to the Rating
Agencies, to the extent such amendment materially and adversely affects the
interests of the Noteholders, with the consent of the Noteholders evidencing not
less than a majority of the Outstanding Amount of the Notes, and the consent of
the Certificateholder
24
(which consent of any Holder of a Certificate or Note given pursuant to this
Section or pursuant to any other provision of this Agreement will be conclusive
and binding on such Holder) 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
Certificateholder; provided, however, that, subject to the express rights of the
Security Insurer under the Basic Documents, no such amendment will (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 will be required to
be made for the benefit of the Noteholders or the Certificateholder or (b)
reduce the aforesaid percentage of the Outstanding Amount of the Notes and the
Certificate Balance required to consent to any such amendment, without the
consent of the Holders of all the outstanding Notes and the Certificateholder.
Promptly after the execution of any such amendment or consent,
the Owner Trustee will furnish written notification of the substance of such
amendment or consent to the Certificateholder, the Indenture Trustee and each of
the Rating Agencies.
It will not be necessary for the consent of Certificateholder,
the Noteholders or the Indenture Trustee pursuant to this Section to approve the
particular form of any proposed amendment or consent, but it will be sufficient
if such consent will approve the substance thereof. The manner of obtaining such
consents (and any other consents of the Certificateholder provided for in this
Agreement or in any other Basic Document) and of evidencing the authorization of
the execution thereof by Certificateholder will 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 will 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 will 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 will 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 10.2. No Legal Title to Owner Trust Estate in
Certificateholder. The Certificateholder will not have legal title to any part
of the Owner Trust Estate. The Certificateholder will be entitled to receive
distributions in accordance with Article VIII. No transfer, by operation of law
or otherwise, of any right, title or interest of the Certificateholder to and in
its ownership interest in the Owner Trust Estate will operate to terminate this
Agreement or the trust 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 10.3. Limitations on Rights of Others. The provisions
of this Agreement are solely for the benefit of the Owner Trustee, the
Depositor, the Certificateholder, the Servicer and, to the extent expressly
provided herein, the Security Insurer, the Indenture Trustee and the
Noteholders, and nothing in this Agreement, whether express or implied, will be
construed to give to any other Person any legal or equitable right, remedy or
claim in the Owner
25
Trust Estate or under or in respect of this Agreement or any covenants,
conditions or provisions contained herein.
SECTION 10.4. Notices.
(a) All demands, notices and communications hereunder
will be in writing and will be deemed to have been duly given to the addressee
if mailed, by first-class registered mail, postage prepaid service, confirmed
facsimile transmission, or a nationally recognized express courier, as follows:
If to the Administrator:
Triad Financial Corporation
0000 Xxxxxx Xxxxxx, Xxxxx 000
Xxxxxxxxxx Xxxxx, Xxxxxxxxxx 00000
Attention: Chief Financial Officer
If to the Owner Trustee:
Wilmington Trust Company
Xxxxxx Square North
0000 Xxxxx Xxxxxx Xxxxxx
Xxxxxxxxxx, Xxxxxxxx 00000
Attention: Chief Financial Officer
If to the Depositor:
Triad Financial Special Purpose LLC
0000 Xxxxxx Xxxxxx, Xxxxx 000
Xxxxxxxxxx Xxxxx, Xxxxxxxxxx 00000
Attention: Chief Financial Officer
If to the Security Insurer:
Security Insurer
MBIA Insurance Corporation
000 Xxxx Xxxxxx
Xxxxxx, XX 00000
Attention: Insured Portfolio Management - Structured
Finance (IPM-SF)
Triad Automobile Receivables Trust 2003-B
Facsimile: (000) 000-0000
Confirmation: (000) 000-0000
(in each case in which notice or other communication to the Security Insurer
refers to an Event of Default, a claim on the Note Policy or with respect to
which failure on the part of the Security Insurer to respond will be deemed to
constitute consent or acceptance, then a copy of such notice or other
communication should also be sent to the attention of the General Counsel and
the Head-Financial Guaranty Group "URGENT MATERIAL ENCLOSED"); or, as to each
party, at such other address as will be designated by such party in a written
notice to each other party. Any such demand, notice or communication hereunder
will be deemed to have been received on
26
the date delivered to or received at the premises of the addressee as evidenced
by the date noted on the return receipt.
(b) Any notice required or permitted to be given to a
Certificateholder will be given by first-class mail, postage prepaid, at the
address of the Holder. Any notice so mailed within the time prescribed in this
Agreement will be conclusively presumed to have been duly given, whether or not
the Certificateholder receives such notice.
SECTION 10.5. Severability. Any provision of this Agreement
that is prohibited or unenforceable in any jurisdiction will, 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 will not invalidate or
render unenforceable such provision in any other jurisdiction.
SECTION 10.6. Separate Counterparts. This Agreement may be
executed by the parties hereto in separate counterparts, each of which when so
executed and delivered will be an original, but all such counterparts will
together constitute but one and the same instrument.
SECTION 10.7. Assignments. This Agreement will inure to the
benefit of and be binding upon the parties hereto and their respective
successors and permitted assigns.
SECTION 10.8. No Recourse. The Certificateholder by accepting
a Certificate acknowledges that the Certificate represents a beneficial interest
in the Trust only and does not represent interests in or obligations of the
Depositor, the Servicer, the Owner Trustee, the Indenture 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 Certificate or the Basic Documents.
SECTION 10.9. No Petition. To the fullest extent permitted by
applicable law, The Owner Trustee, by entering into this Agreement, each
Certificateholder, by accepting a Certificate, and the Indenture Trustee and
each Noteholder, by accepting the benefits of this Agreement, each hereby
covenants and agrees that it will not at any time institute against the
Depositor or the Issuer, or join in any institution against the Depositor or the
Issuer, of 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
Certificate, the Notes, this Agreement or any other Basic Documents.
SECTION 10.10. Headings. The headings of the various Articles
and Sections herein are for convenience of reference only and will not define or
limit any of the terms or provisions hereof.
SECTION 10.11. GOVERNING LAW. THIS AGREEMENT WILL BE GOVERNED
BY, AND 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 WILL BE DETERMINED IN ACCORDANCE WITH SUCH
LAWS.
27
SECTION 10.12. Administrator. The Administrator 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 will 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 will
execute and deliver to the Administrator a limited power of attorney appointing
the Administrator 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.
[Remainder of page intentionally left blank.]
28
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.
WILMINGTON TRUST COMPANY
Owner Trustee
By: /s/ XXXXX X. XXXXXXXX
---------------------------------------------
Name: Xxxxx X. Xxxxxxxx
Title: Financial Services Officer
TRIAD FINANCIAL SPECIAL PURPOSE LLC
Depositor
By: /s/ XXXX X. XXXXXXXX
---------------------------------------------
Name: Xxxx X. Xxxxxxxx
Title: Chief Financial Officer
TRIAD FINANCIAL CORPORATION
Administrator
By: /s/ XXXX X. XXXXXXXX
---------------------------------------------
Name: Xxxx X. Xxxxxxxx
Title: Chief Financial Officer
[Amended and Restated Trust Agreement]
EXHIBIT A
NUMBER
R-1
SEE REVERSE FOR CERTAIN DEFINITIONS
THIS CERTIFICATE IS NOT TRANSFERABLE,
EXCEPT UNDER THE LIMITED CONDITIONS
SPECIFIED IN THE TRUST AGREEMENT
ASSET BACKED CERTIFICATE
evidencing a beneficial ownership interest in certain distributions of the
Trust, as defined below, the property of which includes a pool of retail
installment sale contracts secured by new or used automobiles, vans or light
duty trucks.
THIS CERTIFICATE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR THE APPLICABLE
SECURITIES LAWS OF ANY STATE. ACCORDINGLY, TRANSFER OF THIS CERTIFICATE IS
SUBJECT TO CERTAIN RESTRICTIONS SET FORTH IN SECTION 3.4 OF THE TRUST AGREEMENT.
BY ITS ACCEPTANCE OF THIS CERTIFICATE THE HOLDER OF THIS CERTIFICATE HAS
REPRESENTED TO THE ISSUER AND THE OWNER TRUSTEE THAT IT IS A "QUALIFIED
INSTITUTIONAL BUYER" AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT AND IS
ACQUIRING THIS CERTIFICATE FOR ITS OWN ACCOUNT (AND NOT FOR THE ACCOUNT OF
OTHERS) OR AS A FIDUCIARY OR AGENT FOR OTHERS (WHICH OTHERS ALSO ARE QUALIFIED
INSTITUTIONAL BUYERS).
NO SALE, PLEDGE OR OTHER TRANSFER OF THIS CERTIFICATE MAY BE
MADE BY ANY PERSON UNLESS (I) SUCH SALE, PLEDGE OR OTHER TRANSFER IS MADE
PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT AND ANY
APPLICABLE STATE SECURITIES LAWS OR IS EXEMPT FROM THE REGISTRATION REQUIREMENTS
UNDER THE SECURITIES ACT AND SUCH STATE SECURITIES LAWS, (II) SO LONG AS THIS
CERTIFICATE IS ELIGIBLE FOR RESALE PURSUANT TO RULE 144A UNDER THE SECURITIES
ACT, SUCH SALE, PLEDGE OR OTHER TRANSFER IS MADE TO A PERSON WHO THE TRANSFEROR
REASONABLY BELIEVES AFTER DUE INQUIRY IS A "QUALIFIED INSTITUTIONAL BUYER" (AS
DEFINED IN RULE 144A), ACTING FOR ITS OWN ACCOUNT (AND NOT FOR THE ACCOUNT OF
OTHERS) OR AS A FIDUCIARY OR AGENT FOR OTHERS (WHICH OTHERS ALSO ARE QUALIFIED
INSTITUTIONAL BUYERS) TO WHOM NOTICE IS GIVEN THAT THE SALE, PLEDGE OR TRANSFER
IS BEING MADE IN RELIANCE ON RULE 144A, OR (III) SUCH SALE, PLEDGE OR OTHER
TRANSFER IS OTHERWISE MADE IN A TRANSACTION EXEMPT FROM THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT, IN WHICH CASE (A) THE OWNER
TRUSTEE WILL REQUIRE THAT BOTH THE PROSPECTIVE TRANSFEROR AND THE PROSPECTIVE
TRANSFEREE CERTIFY TO THE OWNER TRUSTEE AND THE ISSUER IN WRITING THE FACTS
SURROUNDING SUCH TRANSFER, WHICH CERTIFICATION WILL BE IN FORM AND SUBSTANCE
SATISFACTORY TO THE OWNER TRUSTEE AND THE ISSUER, AND (B) THE OWNER TRUSTEE MAY
REQUIRE A WRITTEN OPINION OF COUNSEL (WHICH WILL NOT BE AT THE EXPENSE OF THE
ISSUER OR THE OWNER TRUSTEE) SATISFACTORY TO THE ISSUER AND THE OWNER TRUSTEE TO
THE EFFECT THAT SUCH TRANSFER WILL NOT VIOLATE THE SECURITIES ACT. NO SALE,
PLEDGE OR OTHER TRANSFER MAY BE MADE TO ANY ONE PERSON FOR CERTIFICATES WITH A
PERCENTAGE INTEREST OF LESS THAN 5% .
NO TRANSFER OF THIS CERTIFICATE WILL BE PERMITTED TO BE MADE
TO ANY PERSON UNLESS THE OWNER TRUSTEE HAS RECEIVED A CERTIFICATE FROM SUCH
TRANSFEREE TO THE EFFECT THAT THE TRANSFEREE IS NOT AND IS NOT ACTING ON BEHALF
OF OR INVESTING THE ASSETS OF (A) AN "EMPLOYEE BENEFIT PLAN" (AS DEFINED IN
SECTION 3(3) OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED
("ERISA")) THAT IS SUBJECT TO THE PROVISIONS OF TITLE I OF ERISA, (B) A "PLAN"
(AS DEFINED IN SECTION 4975(e)(1) OF THE INTERNAL REVENUE CODE OF 1986, AS
AMENDED (THE "CODE")) THAT IS SUBJECT TO SECTION 4975 OF THE CODE OR (C) ANY
ENTITY WHOSE UNDERLYING ASSETS INCLUDE ASSETS OF A PLAN DESCRIBED IN (A) OR (B)
ABOVE BY REASON OF SUCH PLAN'S INVESTMENT IN THE ENTITY (INCLUDING, WITHOUT
LIMITATION, AN INSURANCE COMPANY GENERAL ACCOUNT). EACH TRANSFEREE OF A
BENEFICIAL INTEREST IN THIS CERTIFICATE WILL BE DEEMED TO HAVE MADE THE
FOREGOING REPRESENTATION.
(THIS CERTIFICATE DOES NOT REPRESENT AN INTEREST IN OR OBLIGATION OF TRIAD
FINANCIAL SPECIAL PURPOSE LLC OR ANY OF ITS AFFILIATES.)
THIS CERTIFIES THAT Triad Financial Special Purpose LLC is the
registered owner of a nonassessable, fully-paid, beneficial ownership interest
in certain distributions of Triad Automobile Receivables Trust 2003-B (the
"Trust") formed by Triad Financial Special Purpose LLC, a Delaware limited
liability company (the "Depositor").
The Trust was created pursuant to a Trust Agreement dated August 5,
2003, as amended and restated as of October 29, 2003 (the "Trust Agreement"),
among the Depositor, Triad Financial Corporation (the "Administrator") and
Wilmington Trust Company, as owner trustee (the "Owner Trustee"), a summary of
certain of the pertinent provisions of which is set forth below. To the extent
not otherwise defined herein, the capitalized terms used herein have the
meanings assigned to them in the Trust Agreement.
This is the duly authorized Certificate designated as "Asset Backed
Certificate" (herein called the "Certificate"). Also issued under the Indenture,
dated as of October 1, 2003, between the Trust, and JPMorgan Chase Bank, as
trustee, are five classes of Notes designated as "Class A-1 1.13% Asset Backed
Notes" (the "Class A-1 Notes"), "Class A-2 1.66% Asset Backed
A-2
Notes" (the "Class A-2 Notes"), "Class A-3 2.48% Asset Backed Notes" (the "Class
A-3 Notes"),"Class A-4 3.20% Asset Backed Notes" (the "Class A-4 Notes") and the
Class B 8.00% Asset Backed Notes" (the "Class B Notes"). This Certificate is
issued under and is subject to the terms, provisions and conditions of the Trust
Agreement, to which Trust Agreement the holder of this Certificate by virtue of
the acceptance hereof assents and by which such holder is bound. The property of
the Trust includes a pool of retail installment sale contracts secured by new
and used automobiles, vans or light duty trucks (the "Receivables"), all monies
due thereunder on or after the Cutoff Date, 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, all right, to and interest of
the Depositor in and to the Purchase Agreement dated as of October 1, 2003
between Triad Financial Corporation and the Depositor and all proceeds of the
foregoing.
The holder of this Certificate acknowledges and agrees that its rights
to receive distributions in respect of this Certificate are subordinated to the
rights of the Noteholders as described in the Sale and Servicing Agreement, the
Indenture and the Trust Agreement, as applicable.
Distributions on this Certificate will be made as provided in the Trust
Agreement and the Sale and Servicing Agreement by the Indenture Trustee by wire
transfer or check mailed to the Certificateholder without the presentation or
surrender of this Certificate or the making of any notation hereon. Except as
otherwise provided in the Trust Agreement or the Sale and Servicing Agreement
and notwithstanding the above, the final distribution on this 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 Certificate at the
office or agency maintained for the purpose by the Indenture Trustee.
Reference is hereby made to the further provisions of this Certificate
set forth on the reverse hereof, which further provisions will for all purposes
have the same effect as if set forth at this place.
Unless the certificate of authentication hereon has been executed by an
authorized officer of the Owner Trustee, by manual signature, this Certificate
will not entitle the holder hereof to any benefit under the Trust Agreement or
the Sale and Servicing Agreement or be valid for any purpose.
THIS CERTIFICATE WILL BE GOVERNED BY, 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
WILL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
A-3
IN WITNESS WHEREOF, the Owner Trustee, on behalf of the Trust and not
in its individual capacity, has caused this Certificate to be duly executed.
TRIAD AUTOMOBILE RECEIVABLES TRUST 2003-B
By: WILMINGTON TRUST COMPANY,
not in its individual capacity but
solely as Owner Trustee of the Trust
Dated: October 29, 2003 By: _________________________________________
Authorized Signatory
OWNER TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is the Certificate referred to in the within-mentioned Trust
Agreement.
WILMINGTON TRUST COMPANY, OR WILMINGTON TRUST COMPANY,
not in its individual capacity but solely as not in its individual
Owner Trustee of the Trust capacity but solely as
Owner Trustee of the Trust
By: _________________________ By: _______________________
Authenticating Agent Authorized Signatory
By: _________________________
Authorized Signatory
A-4
(Reverse of Certificate)
The Certificate does 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 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, all as more
specifically set forth herein and 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 Administrator, 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 under the Trust Agreement at any time by the Depositor, the
Administrator and the Owner Trustee with the consent of the Security Insurer,
the Note Majority and the Certificateholder. Any such consent by the Holder of
this Certificate will be conclusive and binding on such Holder and on all future
Holders of this Certificate and of any Certificate issued upon the transfer
hereof or in exchange hereof or in lieu hereof whether or not notation of such
consent is made upon this Certificate. The Trust Agreement also permits the
amendment thereof, in certain limited circumstances, without the consent of the
Certificateholder.
As provided in the Trust Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registerable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the offices or agencies of the Certificate Registrar maintained by
the Owner Trustee 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 a new Certificate 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 Wilmington Trust Company. 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 expense, tax or governmental charge payable in
connection therewith.
The Owner Trustee, the Security Insurer and any agent of the Owner
Trustee or the Security Insurer may treat the person in whose name this
Certificate is registered as the owner hereof for all purposes, and none of the
Owner Trustee, the Security Insurer nor any such agent will be affected by any
notice to the contrary.
The obligations and responsibilities created by the Trust Agreement and
the Trust created thereby will terminate upon the payment to the
Certificateholder of all amounts required to be paid to it pursuant to the Trust
Agreement and the Sale and Servicing Agreement and the disposition of all
property held as part of the Trust. The Servicer of the Receivables 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 Certificate; however, such right
of purchase is exercisable, subject to certain restrictions,
A-5
only as of the last day of any Collection Period as of which the Pool Balance is
10% or less of the Original Pool Balance.
The recitals contained herein will be taken as the statements of the
Trust 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 Certificate or of any Receivable or related document.
Unless the certificate of authentication hereon will have been executed by an
authorized officer of the Owner Trustee, by manual or facsimile signature, this
Certificate will not entitle the Holder hereof to any benefit under the Trust
Agreement or the Sale and Servicing Agreement or be valid for any purpose.
A-6
ASSIGNMENT
FOR VALUE RECEIVED the undersigned hereby sells, assigns and transfers unto
PLEASE INSERT SOCIAL SECURITY
OR OTHER IDENTIFYING NUMBER
OF ASSIGNEE
________________________________________________________________________________
(Please print or type name and address, including postal zip code, of assignee)
________________________________________________________________________________
the within Certificate, and all rights thereunder, hereby irrevocably
constituting and appointing
______________________________ Attorney to transfer said Certificate on the
books of the Certificate Registrar, with full power of substitution in the
premises.
Dated: __________________________________*
Signature
Guaranteed: __________________________________*
____________________________
* NOTICE: The signature to this assignment must correspond with the name
of the registered owner as it appears on the face of the within
Certificate in every particular, without alteration, enlargement or any
change whatever. Such signature must be guaranteed by an "eligible
guarantor institution" meeting the requirements of the Certificate
Registrar, which requirements include membership or participation in
STAMP or such other "signature guarantee program" as may be determined
by the Certificate Registrar in addition to, or in substitution for,
STAMP, all in accordance with the Securities Exchange Act of 1934, as
amended.
A-7
EXHIBIT B
FORM OF
CERTIFICATE OF TRUST
OF
TRIAD AUTOMOBILE RECEIVABLES TRUST 2003-B
THIS Certificate of Trust of TRIAD AUTOMOBILE RECEIVABLES
TRUST 2003-B (the "Trust") is being duly executed and filed on behalf of the
Trust by the undersigned, as trustee, to form a statutory trust under the
Delaware Statutory Trust Act (12 Del. C. Section 3801 et seq.) (the "Act").
1. Name. The name of the statutory trust formed by this
Certificate of Trust is "Triad Automobile Receivables Trust 2003-B."
2. Delaware Trustee. The name and business address of
the trustee of the Trust in the State of Delaware is Wilmington Trust Company.
3. Effective Date. This Certificate of Trust will be
effective upon filing.
IN WITNESS WHEREOF, the undersigned has duly executed this
Certificate of Trust in accordance with Section 3811(a)(1) of the Act.
WILMINGTON TRUST COMPANY, not in its
individual capacity but solely as trustee of
the Trust
By: _________________________________________
Name:
Title:
B-1
EXHIBIT C
[FORM OF CERTIFICATE AS TO INITIAL PURCHASE]
[date]
Triad Automobile Receivables Trust 2003-B
c/o Wilmington Trust Company
Xxxxxx Square North
0000 Xxxxx Xxxxxx Xxxxxx
Xxxxxxxxxx Xxxxxxxx 00000-0000
Attention: Corporate Trust Administration
Wilmington Trust Company
Xxxxxx Square North
0000 Xxxxx Xxxxxx Xxxxxx
Xxxxxxxxxx, Xxxxxxxx 00000
Attention: Chief Financial Officer
Re: Triad Automobile Receivables Trust 2003-B,
Trust Certificate
Dear Sirs:
In connection with the proposed purchase by the buyer listed below (the
"Buyer") of the above-referenced Trust Certificate (the "Certificate") issued
pursuant to the Amended and Restated Trust Agreement, dated as of October 29,
2003 (the "Trust Agreement") among Triad Financial Special Purpose LLC, as
depositor (the "Depositor"), Triad Financial Corporation, as administrator (the
"Administrator") and Wilmington Trust Company, as Owner Trustee (the "Owner
Trustee"), relating to the Triad Automobile Receivables Trust 2003-B
Certificate, the Buyer advises you as follows:
(i) it (a) has such knowledge and experience in
financial and business matters that it is
capable of evaluating the merits and risks
of its investment in the Certificate and is
able to bear the economic risks of such
investment; (b) is a "qualified
institutional buyer" as that term is defined
in Rule 144A under the Securities Act of
1933, as amended, and is acquiring
beneficial ownership of the Certificate for
its own account or for the account of
another "qualified institutional buyer"; (c)
satisfies the requirements of paragraph
(a)(2)(ii) of Rule 3a-7 under the Investment
Company Act of 1940, as amended, and (d)
understands that the Administrator, the
Depositor and the Owner Trustee are relying
on such representations in connection with
the issuance of the Certificate;
(ii) it has reviewed the Prospectus Supplement
(including the section captioned "Risk
Factors" therein) and such other materials
and information with respect to the
Certificate, the Depositor and the
Administrator as it deems necessary and has
been afforded the opportunity to make
inquiry of the Depositor and the
Administrator and to receive answers, and
has received all information requested;
(iii) it understands that the Certificate have not
been registered or qualified under the 1933
Act or the securities laws of any state;
(iv) it has not distributed the Prospectus
Supplement or any other materials relating
to the Certificate to anyone other than its
counsel or other advisor, and no one other
than such counsel or advisor has used its
copies of such documents; and
(v) it is not, and is not acting on behalf of or
investing the assets of, (x) an employee
benefit plan (as defined in Section 3(3) of
the Employee Retirement Income Security Act
of 1974, as amended ("ERISA")) that is
subject to the provisions of Title I of
ERISA, (y) a plan (as defined in Section
4975(e)(1) of the Internal Revenue Code of
1986, as amended (the "Code") that is
subject to Section 4975 of the Code or (z)
any entity whose underlying assets include
assets of a plan described in (x) or (y)
above by reason of such plan's investment in
the entity (including, without limitation,
an insurance company general account).
Very truly yours,
[BUYER]
By: ____________________________________
Name:
Title:
C-2
EXHIBIT D
[FORM OF "QUALIFIED INSTITUTIONAL BUYER" TRANSFEREE'S CERTIFICATE]
[date]
Triad Automobile Receivables Trust 2003-B
c/o Wilmington Trust Company, as Owner Trustee
Xxxxxx Square North
0000 Xxxxx Xxxxxx Xxxxxx
Xxxxxxxxxx, Xxxxxxxx 00000-0000
Attention: Corporate Trust Administration
Wilmington Trust Company
Xxxxxx Square North
0000 Xxxxx Xxxxxx Xxxxxx
Xxxxxxxxxx, Xxxxxxxx 00000
Attention: Chief Financial Officer
Re: Triad Automobile Receivables Trust 2003-B,
Trust Certificate
Dear Sirs:
In connection with the proposed purchase by the buyer listed below (the
"Buyer") of the above-referenced Trust Certificate (the "Certificate") issued
pursuant to the Amended and Restated Trust Agreement, dated as of October 29,
2003 (the "Trust Agreement") among Triad Financial Special Purpose LLC, as
depositor (the "Depositor"), Triad Financial Corporation, as administrator (the
"Administrator") and Wilmington Trust Company, as Trustee (the "Owner Trustee"),
relating to the Triad Automobile Receivables Trust 2003-A Certificate, the Buyer
advises you as follows: (i) the Buyer is a "qualified institutional buyer" as
that term is defined in Rule 144A under the Securities Act of 1933, as amended
(the "1933 Act") and is acquiring beneficial ownership of the Certificate for
its own account or for the account of another "qualified institutional buyer";
and (ii) the Buyer satisfies the requirements of paragraph (a)(2)(ii) of Rule
3a-7 under the Investment Company Act of 1940, as amended (the "1940 Act"). In
addition to the foregoing, you may rely on the information provided in Annex 1
or 2, as applicable, attached hereto and incorporated herein.
The Buyer understands that the Certificate has not been registered
under the 1933 Act or the securities laws of any state. The Buyer acknowledges
that it has independently conducted such investigation and evaluation of the
merits and the risks involved in an investment in the Certificate and has
received such information (whether from the Depositor, the transferor from which
it proposes to purchase Certificate, or from any other source) as the Buyer has
deemed necessary and advisable in order to make its investment decision. The
Buyer has had any questions arising from such investigation and evaluation
answered by the Issuer to the satisfaction of the Buyer. The Buyer is a
sophisticated institutional investor, having such knowledge and experience in
financial and business matters generally, and with respect to asset-backed notes
and investments in "non-prime" and "sub-prime" automobile loans specifically,
that it is capable of independently evaluating the merits and risks of
investment in the Certificate. In the normal course of its business, the Buyer
invests in or purchases notes similar to the
D-1
Certificate. The Buyer is aware that it may be required to bear the economic
risk of an investment in the Certificate for an indefinite period of time, and
it is able to bear such risk for an indefinite period.
Very truly yours,
[BUYER]
By: __________________________________
Name:
Title:
Taxpayer ID: _____
Name in which
Note is
to be Registered:________________________
Address for Notices ______________________
______________________
______________________
Payment Instructions _____
X-0
XXXXX 0 XX XXXXXXX X
QUALIFIED INSTITUTIONAL BUYER STATUS UNDER SEC RULE 144A
[For Buyers Other Than Registered Investment Companies]
The undersigned hereby certifies as follows to the parties listed in
the "Qualified Institutional Buyer" Transferee's Certificate to which this
certification relates with respect to the Rule 144A Securities described
therein:
1. As indicated below, the undersigned is the President, Chief
Financial Officer, Senior Vice President or other executive officer of the
Buyer.
2. In connection with purchases by the Buyer, the Buyer is a "qualified
institutional buyer" as that term is defined in Rule 144A under the Securities
Act of 1933 ("Rule 144A") because (i) the Buyer owned and/or invested on a
discretionary basis $_____________(1) in securities (except for the excluded
securities referred to below) as of the end of the Buyer's most recent fiscal
year (such amount being calculated in accordance with Rule 144A) and (ii) the
Buyer satisfies the criteria in the category marked below.
- Corporation, etc. The Buyer is a corporation (other than a
bank, savings and loan association or similar institution),
Massachusetts or similar business trust, partnership, or
charitable organization described in Section 501(c)(3) of the
Internal Revenue Code of 1986, as amended.
- Bank. The Buyer (a) is a national bank or banking institution
organized under the laws of any State, territory or the
District of Columbia, the business of which is substantially
confined to banking and is supervised by the State or
territorial banking commission or similar official or is a
foreign bank or equivalent institution, and (b) has an audited
net worth of at least $25,000,000 as demonstrated in its
latest annual financial statements, a copy of which is
attached hereto.
- Savings and Loan. The Buyer (a) is a savings and loan
association, building and loan association, cooperative bank,
homestead association or similar institution, which is
supervised and examined by a State or Federal authority having
supervision over any such institutions or is a foreign savings
and loan association or equivalent institution and (b) has an
audited net worth of at least $25,000,000 as demonstrated in
its latest annual financial statements, a copy of which is
attached hereto.
- Broker-dealer. The Buyer is a dealer registered pursuant to
Section 15 of the Securities Exchange Act of 1934.
______________________________
(1) Buyer must own and/or invest on a discretionary basis
at least $100,000,000 in securities unless Buyer is a dealer, and, in that case,
Buyer must own and/or invest on a discretionary basis at least $10,000,000 in
securities.
D-3
- Insurance Company. The Buyer is an insurance company whose
primary and predominant business activity is the writing of
insurance or the reinsuring of risks underwritten by insurance
companies and which is subject to supervision by the insurance
commissioner or a similar official or agency of a State,
territory or the District of Columbia.
- State or Local Plan. The Buyer is a plan established and
maintained by a State, its political subdivisions, or any
agency or instrumentality of the State or its political
subdivisions, for the benefit of its employees.
- ERISA Plan. The Buyer is an employee benefit plan within the
meaning of Title I of the Employee Retirement Income Security
Act of 1974.
- Investment Advisor. The Buyer is an investment advisor
registered under the Investment Advisers Act of 1940.
- Small Business Investment Company. Buyer is a small business
investment company licensed by the U.S. Small Business
Administration under Section 301(c) or (d) of the Small
Business Investment Act of 1958.
- Business Development Company. Buyer is a business development
company as defined in Section 202(a)(22) of the Investment
Advisors Act of 1940.
- Trust Fund. The Buyer is a trust fund whose trustee is a bank
or trust company and whose participants are exclusively State
or Local Plans or ERISA Plans as defined above, and no
participant of the Buyer is an individual retirement account
or an H.R. 10 (Xxxxx) plan.
3. The Buyer is not, and is not acting on behalf of or investing
the assets of, (a) an employee benefit plan (as defined in Section 3(3) of the
Employee Retirement Income Security Act of 1974, as amended ("ERISA")) that is
subject to the provisions of Title I of ERISA, (b) a plan (as defined in Section
4975(e)(1) of the Internal Revenue Code of 1986, as amended (the "Code") that is
subject to Section 4975 of the Code or (c) any entity whose underlying assets
include assets of a plan described in (a) or (b) above by reason of such plan's
investment in the entity (including, without limitation, an insurance company
general account).
4. The term "securities" as used herein does not include (i)
securities of issuers that are affiliated with the Buyer, (ii) securities that
are part of an unsold allotment to or subscription by the Buyer, if the Buyer is
a dealer, (iii) bank deposit notes and certificates of deposit, (iv) loan
participations, (v) repurchase agreements, (vi) securities owned but subject to
a repurchase agreement and (vii) currency, interest rate and commodity swaps.
5. For purposes of determining the aggregate amount of securities
owned and/or invested on a discretionary basis by the Buyer, the Buyer used the
cost of such securities to the Buyer and did not include any of the securities
referred to in the preceding paragraph, except (i) where the Buyer reports its
securities holdings in its financial statements on the basis of their market
value, and (ii) no current information with respect to the cost of those
securities has been published. If clause (ii) in the preceding sentence applies,
the securities may be valued at
D-4
market. Further, in determining such aggregate amount, the Buyer may have
included securities owned by subsidiaries of the Buyer, but only if such
subsidiaries are consolidated with the Buyer in its financial statements
prepared in accordance with generally accepted accounting principles and if the
investments of such subsidiaries are managed under the Buyer's direction.
However, such securities were not included if the Buyer is a majority-owned,
consolidated subsidiary of another enterprise and the Buyer is not itself a
reporting company under the Securities Exchange Act of 1934.
6. The Buyer acknowledges that it is familiar with Rule 144A and
understands that the seller to it and other parties related to the securities
are relying and will continue to rely on the statements made herein because one
or more sales to the Buyer may be in reliance on Rule 144A.
7. Until the date of purchase of the Rule 144A Securities, the
Buyer will notify each of the parties to which this certification is made of any
changes in the information and conclusions herein. Until such notice is given,
the Buyer's purchase of Rule 144A Securities will constitute a reaffirmation of
this certification as of the date of such purchase. In addition, if the Buyer is
a Bank or Savings and Loan as provided above, the Buyer agrees that it will
furnish to such parties updated annual financial statements promptly after they
become available.
_____________________________________________
Print Name of Buyer
By: _________________________________________
Name:
Title:
Date: _______________________________________
X-0
XXXXX 0 XX XXXXXXX X
QUALIFIED INSTITUTIONAL BUYER STATUS UNDER SEC RULE 144A
[For Buyers that are Registered Investment Companies]
The undersigned hereby certifies as follows to the parties listed in
the "Qualified Institutional Buyer" Transferee's Certificate to which this
certification relates with respect to the Rule 144A Securities described
therein:
1. As indicated below, the undersigned is the President, Chief
Financial Officer or Senior Vice President of the Buyer or, if the Buyer is a
"qualified institutional buyer" as that term is defined in Rule 144A under the
Securities Act of 1933 ("Rule 144A"), because Buyer is part of a Family of
Investment Companies (as defined below), is such an officer of the Buyer.
2. In connection with purchases by Buyer, the Buyer is a
"qualified institutional buyer" as defined in SEC Rule 144A because (i) the
Buyer is an investment company registered under the Investment Company Act of
1940, and (ii) as marked below, the Buyer alone, or the Buyer's Family of
Investment Companies, owned at least $100,000,000 in securities (other than the
excluded securities referred to below) as of the end of the Buyer's most recent
fiscal year. For purposes of determining the amount of securities owned by the
Buyer or the Buyer's Family of Investment Companies, the cost of such securities
was used, except (i) where the Buyer or the Buyer's Family of Investment
Companies reports its securities holdings in its financial statements on the
basis of their market value, and (ii) no current information with respect to the
cost of those securities has been published. If clause (ii) in the preceding
sentence applies, the securities may be valued at market.
- The Buyer owned $________________ in securities (other than
the excluded securities referred to below) as of the end of
the Buyer's most recent fiscal year (such amount being
calculated in accordance with Rule 144A).
- The Buyer is part of a Family of Investment Companies which
owned in the aggregate $__________ in securities (other than
the excluded securities referred to below) as of the end of
the Buyer's most recent fiscal year (such amount being
calculated in accordance with Rule 144A).
3. The Buyer is not, and is not acting on behalf of or investing
the assets of, (a) an employee benefit plan (as defined in Section 3(3) of the
Employee Retirement Income Security Act of 1974, as amended ("ERISA")) that is
subject to the provisions of Title I of ERISA, (b) a plan (as defined in Section
4975(e)(1) of the Internal Revenue Code of 1986, as amended (the "Code") that is
subject to Section 4975 of the Code or (c) any entity whose underlying assets
include assets of a plan described in (a) or (b) above by reason of such plan's
investment in the entity (including, without limitation, an insurance company
general account).
4. The term "Family of Investment Companies" as used herein means
two or more registered investment companies (or series thereof) that have the
same investment adviser or
D-6
investment advisers that are affiliated (by virtue of being majority owned
subsidiaries of the same parent or because one investment adviser is a majority
owned subsidiary of the other).
5. The term "securities" as used herein does not include (i)
securities of issuers that are affiliated with the Buyer or are part of the
Buyer's Family of Investment Companies, (ii) bank deposit notes and certificates
of deposit, (iii) loan participations, (iv) repurchase agreements, (v)
securities owned but subject to a repurchase agreement and (vi) currency,
interest rate and commodity swaps.
6. The Buyer is familiar with Rule 144A and understands that the
parties listed in the "Qualified Institutional Buyer" Transferee's Certificate
to which this certification relates are relying and will continue to rely on the
statements made herein because one or more sales to the Buyer will be in
reliance on Rule 144A. In addition, the Buyer will only purchase for the Buyer's
own account.
7. Until the date of purchase of the Rule 144A Securities, the
undersigned will notify each of the parties to which this certification is made
of any changes in the information and conclusions herein. Until such notice is
given, the Buyer's purchase of Rule 144A Securities will constitute a
reaffirmation of this certification by the undersigned as of the date of such
purchase.
_____________________________________________
Print Name of Buyer or Adviser
By: _________________________________________
Name:
Title:
IF AN ADVISER:
_____________________________________________
Print Name of Buyer
Date: _______________________________________
D-7
