AMENDED AND RESTATED
TRUST AGREEMENT
between
FIRST MERCHANTS AUTO RECEIVABLES CORPORATION II,
as Depositor,
and
CHASE MANHATTAN BANK DELAWARE,
as Owner Trustee
Dated as of March 1, 1997
TABLE OF CONTENTS
ARTICLE I
Definitions
SECTION 1.01.
Capitalized Terms . . . . . . . . . . . . . . . . . 1
SECTION 1.02.
Other Definitional Provisions . . . . . . . . . . . 3
ARTICLE II
Organization
SECTION 2.01.
Name. . . . . . . . . . . . . . . . . . . . . . . . 4
SECTION 2.02.
Office. . . . . . . . . . . . . . . . . . . . . . . 4
SECTION 2.03.
Purposes and Powers . . . . . . . . . . . . . . . . 4
SECTION 2.04.
Appointment of Owner Trustee. . . . . . . . . . . . 4
SECTION 2.05.
Initial Capital Contribution of Owner Trust Estate. 4
SECTION 2.06.
Declaration of Trust. . . . . . . . . . . . . . . . 5
SECTION 2.07.
Liability of the Owners . . . . . . . . . . . . . . 5
SECTION 2.08.
Title to Trust Property . . . . . . . . . . . . . . 5
SECTION 2.09.
Situs of Trust. . . . . . . . . . . . . . . . . . . 5
SECTION 2.10.
Representations and Warranties of the Depositor . . 5
ARTICLE III
Trust Certificates and Transfer of Interests
SECTION 3.01.
Initial Ownership . . . . . . . . . . . . . . . . . 6
SECTION 3.02.
The Trust Certificates. . . . . . . . . . . . . . . 6
SECTION 3.03.
Authentication of Trust Certificates. . . . . . . . 6
SECTION 3.04.
Registration of Transfer and Exchange of Trust Certificates 7
SECTION 3.05.
Mutilated, Destroyed, Lost or Stolen Trust Certificates 8
SECTION 3.06.
Persons Deemed Owners . . . . . . . . . . . . . . . 8
SECTION 3.07.
Access to List of Certificateholders' Names and Addresses 9
SECTION 3.08.
Maintenance of Office or Agency . . . . . . . . . . 9
SECTION 3.09.
Appointment of Paying Agent . . . . . . . . . . . . 9
SECTION 3.10.
[Reserved]. . . . . . . . . . . . . . . . . . . . . 9
ARTICLE IV
Actions by Owner Trustee
SECTION 4.01.
Prior Notice with Respect to Certain Matters. . . . 10
SECTION 4.02.
Action by Owners with Respect to Certain Matters. . 10
SECTION 4.03.
Action by Owners with Respect to Bankruptcy . . . . 10
SECTION 4.04.
Restrictions on Owners' Power . . . . . . . . . . . 11
SECTION 4.05.
Majority Control. . . . . . . . . . . . . . . . . . 11
ARTICLE V
Application of Trust Funds; Certain Duties
SECTION 5.01.
Establishment of Trust Account. . . . . . . . . . . 11
SECTION 5.02.
Application of Trust Funds. . . . . . . . . . . . . 11
SECTION 5.03.
Method of Payment . . . . . . . . . . . . . . . . . 12
SECTION 5.04.
No Segregation of Moneys; No Interest.. . . . . . . 12
SECTION 5.05.
Accounting and Reports to the Noteholders, Owners, the
Internal Revenue Service and Others. . . . . . . . . . . 12
ARTICLE VI
Authority and Duties of Owner Trustee
SECTION 6.01.
General Authority . . . . . . . . . . . . . . . . . 12
SECTION 6.02.
General Duties. . . . . . . . . . . . . . . . . . . 13
SECTION 6.03.
Action upon Instruction . . . . . . . . . . . . . . 13
SECTION 6.04.
No Duties Except as Specified in this Agreement or in
Instructions . . . . . . . . . . . . . . . . . . . . . . 13
SECTION 6.05.
No Action Except Under Specified Documents or Instructions 14
SECTION 6.06.
Restrictions. . . . . . . . . . . . . . . . . . . . 14
ARTICLE VII
Concerning the Owner Trustee
SECTION 7.01.
Acceptance of Trusts and Duties . . . . . . . . . . 14
SECTION 7.02.
Furnishing of Documents . . . . . . . . . . . . . . 15
SECTION 7.03.
Representations and Warranties. . . . . . . . . . . 15
SECTION 7.04.
Reliance; Advice of Counsel . . . . . . . . . . . . 15
SECTION 7.05.
Not Acting in Individual Capacity . . . . . . . . . 16
SECTION 7.06.
Owner Trustee Not Liable for Trust Certificates or for
Receivables. . . . . . . . . . . . . . . . . . . . . . . 16
SECTION 7.07.
Owner Trustee May Own Trust Certificates and Notes. 16
SECTION 7.08.
Pennsylvania Motor Vehicle Sales Finance Act Licenses 16
ARTICLE VIII
Compensation of Owner Trustee
SECTION 8.01.
Owner Trustee's Fees and Expenses . . . . . . . . . 17
SECTION 8.02.
Indemnification . . . . . . . . . . . . . . . . . . 17
SECTION 8.03.
Payments to the Owner Trustee . . . . . . . . . . . 17
ARTICLE IX
Termination of Trust Agreement
SECTION 9.01.
Termination of Trust Agreement. . . . . . . . . . . 17
SECTION 9.02.
[Reserved]. . . . . . . . . . . . . . . . . . . . . 18
ARTICLE X
Successor Owner Trustees and Additional Owner Trustees
SECTION 10.01.
Eligibility Requirements for Owner Trustee. . . . . 19
SECTION 10.02.
Resignation or Removal of Owner Trustee . . . . . . 19
SECTION 10.03.
Successor Owner Trustee . . . . . . . . . . . . . . 19
SECTION 10.04.
Merger or Consolidation of Owner Trustee. . . . . . 20
SECTION 10.05.
Appointment of Co-Trustee or Separate Trustee . . . 20
ARTICLE XI
Miscellaneous
SECTION 11.01.
Supplements and Amendments. . . . . . . . . . . . . 21
SECTION 11.02.
No Legal Title to Owner Trust Estate in Owners. . . 22
SECTION 11.03.
Limitations on Rights of Others . . . . . . . . . . 22
SECTION 11.04.
Notices . . . . . . . . . . . . . . . . . . . . . . 22
SECTION 11.05.
Severability. . . . . . . . . . . . . . . . . . . . 22
SECTION 11.06.
Separate Counterparts . . . . . . . . . . . . . . . 23
SECTION 11.07.
Successors and Assigns. . . . . . . . . . . . . . . 23
SECTION 11.08.
Covenants of the Depositor. . . . . . . . . . . . . 23
SECTION 11.09.
No Petition . . . . . . . . . . . . . . . . . . . . 23
SECTION 11.10.
No Recourse . . . . . . . . . . . . . . . . . . . . 23
SECTION 11.11.
Headings. . . . . . . . . . . . . . . . . . . . . . 23
SECTION 11.12.
GOVERNING LAW . . . . . . . . . . . . . . . . . . . 23
AMENDED AND RESTATED TRUST AGREEMENT dated as of March 1, 1997, between FIRST
MERCHANTS AUTO RECEIVABLES CORPORATION II, a Delaware corporation, as
depositor (the "Depositor"), and CHASE MANHATTAN BANK DELAWARE, a Delaware
banking corporation, as owner trustee (the "Owner Trustee").
WHEREAS, the Depositor and the Owner Trustee entered into a Trust Agreement
dated as of March 10, 1997 (the "Trust Agreement");
WHEREAS, the Trust Agreement is being amended and restated as of March 1,
1997;
NOW, THEREFORE, the Depositor and the Owner Trustee hereby agree as follows:
ARTICLE I
Definitions
SECTION 1.01.
Capitalized Terms. For all purposes of this Agreement, the following terms
shall have the meanings set forth below:
"Administration Agreement" shall mean the Administration Agreement dated as
of March 1, 1997, among the Trust, the Indenture Trustee and First Merchants
Acceptance Corporation, as Administrator.
"Agreement" shall mean this Amended and Restated Trust Agreement, as the
same may be amended and supplemented from time to time.
"Benefit Plan" shall have the meaning assigned to such term in Section
11.13.
"Business Trust Statute" shall mean Chapter 38 of Title 12 of the Delaware
Code, 12 Del. Code &3801 et seq., as the same may be amended from time to
time.
"Certificate Balance" shall mean the Initial Certificate Balance reduced by
all amounts allocable to principal previously distributed to
Certificateholders.
"Certificate Distribution Account" shall have the meaning assigned to such
term in Section 5.01.
"Certificate of Trust" shall mean the Certificate of Trust in the form of
Exhibit B filed for the Trust pursuant to Section 3810(a) of the Business
Trust Statute.
"Certificate Register" and "Certificate Registrar" shall mean the register
mentioned in and the registrar appointed pursuant to Section 3.04.
"Certificateholder" or "Holder" shall mean a Person in whose name a Trust
Certificate is registered.
"Class A-1 Notes" shall mean the Floating Rate Asset Backed Notes, Class A-1
issued pursuant to the Indenture.
"Class A-2 Notes" shall mean the 6.75% Asset Backed Notes, Class A-2 issued
pursuant to the Indenture.
"Clearing Agency" shall mean an organization registered as a "clearing
agency" pursuant to Section 17A of the Exchange Act.
"Code" shall mean the Internal Revenue Code of 1986, as amended, and
Treasury Regulations promulgated thereunder.
"Corporate Trust Office" shall mean, with respect to the Owner Trustee, the
principal corporate trust office of the Owner Trustee located at 0000 Xxxxxx
Xxxxxx, Xxxxxxxxxx, Xxxxxxxx 00000, or at such other address in the State of
Delaware as the Owner Trustee may designate by notice to the Owners and the
Depositor, or the principal corporate trust office of any successor Owner
Trustee at the address in the State of Delaware designated by such successor
Owner Trustee by notice to the Owners and the Depositor.
"Demand Note" shall mean the Demand Note dated May 21, 1996 from First
Merchants Acceptance Corporation to the Depositor.
"Depositor" shall mean First Merchants Auto Receivables Corporation II in
its capacity as depositor hereunder.
"ERISA" shall mean the Employee Retirement Income Security Act of 1974, as
amended.
"Exchange Act" shall mean the Securities Exchange Act of 1934, as amended.
"Expenses" shall have the meaning assigned to such term in Section 8.02.
"Indemnified Parties" shall have the meaning assigned to such term in
Section 8.02.
"Indenture" shall mean the Indenture dated as of March 1, 1997 between the
Trust and Xxxxxx Trust and Savings Bank, as Indenture Trustee.
"Initial Certificate Balance" shall mean $8,486,690.83.
"Note Depository Agreement" shall mean the agreement dated March 27, 1997
among the Trust, the Indenture Trustee, the Administrator and The Depository
Trust Company, as the initial Clearing Agency, relating to the Class A-1
Notes and the Class A-2 Notes, as the same may be amended and supplemented
from time to time.
"Owner" shall mean each Holder of a Trust Certificate.
"Owner Trust Estate" shall mean all right, title and interest of the Trust
in and to the property and rights assigned to the Trust pursuant to Article II
of the Sale and Servicing Agreement, all funds on deposit from time to time
in the Trust Accounts and the Certificate Distribution Account and all other
property of the Trust from time to time, including any rights of the Owner
Trustee and the Trust pursuant to the Sale and Servicing Agreement and the
Administration Agreement.
"Owner Trustee" shall mean Chase Manhattan Bank Delaware, a Delaware banking
corporation, not in its individual capacity but solely as owner trustee under
this Agreement, and any successor Owner Trustee hereunder.
"Paying Agent" shall mean any paying agent or co-paying agent appointed
pursuant to Section 3.09 and shall initially be The Chase Manhattan Bank.
"Person" shall mean any individual, corporation, estate, partnership, joint
venture, association, joint stock company, limited liability company, trust
(including any beneficiary thereof), unincorporated organization, or
government or any agency or political subdivision thereof.
"Premium Letter" shall mean the letter agreement dated as of the Closing
Date among the Security Insurer, First Merchants Acceptance Corporation, the
Depositor and the Issuer.
"Record Date" shall mean, with respect to any Distribution Date, the last
day of the month preceding such Distribution Date.
"Sale and Servicing Agreement" shall mean the Sale and Servicing Agreement
dated as of March 1, 1997, among the Trust, as issuer, the Depositor, as
seller, First Merchants Acceptance Corporation, as servicer, and Xxxxxx Trust
and Savings Bank, as indenture trustee and backup servicer, as the same may
be amended or supplemented from time to time.
"Secretary of State" shall mean the Secretary of State of the State of
Delaware.
"Treasury Regulations" shall mean regulations, including proposed or
temporary Regulations, promulgated under the Code. References herein to
specific provisions of proposed or temporary regulations shall include
analogous provisions of final Treasury Regulations or other successor
Treasury Regulations.
"Trust" shall mean the trust established by this Agreement.
"Trust Certificate" shall mean a certificate evidencing the beneficial
interest of an Owner in the Trust, substantially in the form attached hereto
as Exhibit A.
SECTION 1.02.
Other Definitional Provisions. (a) Capitalized terms used and not
otherwise defined herein have the meanings assigned to them in the Sale and
Servicing Agreement or, if not defined therein, in the Indenture.
(b)
All terms defined in this Agreement shall have the defined meanings when
used in any certificate or other document made or delivered pursuant hereto
unless otherwise defined therein.
(c)
As used in this Agreement and in any certificate or other document made or
delivered pursuant hereto or thereto, accounting terms not defined in this
Agreement or in any such certificate or other document, and accounting terms
partly defined in this Agreement or in any such certificate or other document
to the extent not defined, shall have the respective meanings given to them
under generally accepted accounting principles. To the extent that the
definitions of accounting terms in this Agreement or in any such certificate
or other document are inconsistent with the meanings of such terms under
generally accepted accounting principles, the definitions contained in this
Agreement or in any such certificate or other document shall control.
(d)
The words "hereof," "herein," "hereunder" and words of similar import when
used in this Agreement shall refer to this Agreement as a whole and not to
any particular provision of this Agreement; Section and Exhibit references
contained in this Agreement are references to Sections and Exhibits in or to
this Agreement unless otherwise specified; and the term "including" shall
mean "including without limitation".
(e)
The definitions contained in this Agreement are applicable to the singular
and plural forms of such terms and to the masculine, feminine and neuter
genders of such terms.
(f)
Any agreement, instrument or statute defined or referred to herein or in any
instrument or certificate delivered in connection herewith means such
agreement, instrument or statute as from time to time amended, modified or
supplemented and includes (in the case of agreements or instruments)
references to all attachments thereto and instruments incorporated therein;
references to a Person are also to its permitted successors and assigns.
ARTICLE II
Organization
SECTION 2.01.
Name. The Trust created hereby shall be known as "First Merchants Auto
Trust 1997-1," in which name the Owner Trustee may conduct the business of the
Trust, make and execute contracts and other instruments on behalf of the
Trust and xxx and be sued.
SECTION 2.02.
Office. The office of the Trust shall be in care of the Owner Trustee at
the Corporate Trust Office or at such other address in Delaware as the Owner
Trustee may designate by written notice to the Owners and the Depositor.
SECTION 2.03.
Purposes and Powers. (a) The purpose of the Trust is to engage in the
following activities:
(i)
to issue the Notes pursuant to the Indenture and the Trust Certificates
pursuant to this Agreement and to sell the Notes and the Trust Certificates;
(ii)
with the proceeds of the sale of the Notes and the Trust Certificates, to
purchase the Receivables and to pay the organizational, start-up and
transactional expenses of the Trust;
(iii)
to assign, grant, transfer, pledge, mortgage and convey the Trust Estate
pursuant to the Indenture and to hold, manage and distribute to the Owners
pursuant to the terms of the Sale and Servicing Agreement any portion of the
Trust Estate released from the Lien of, and remitted to the Trust pursuant
to, the Indenture;
(iv)
to enter into and perform its obligations under the Basic Documents to which
it is to be a party;
(v)
to engage in those activities, including entering into agreements, that are
necessary, suitable or convenient to accomplish the foregoing or are
incidental thereto or connected therewith; and
(vi)
subject to compliance with the Basic Documents, to engage in such other
activities as may be required in connection with conservation of the Owner
Trust Estate and the making of distributions to the Owners and the
Noteholders.
The Trust is hereby authorized to engage in the foregoing activities. The
Trust shall not engage in any activity other than in connection with the
foregoing or other than as required or authorized by the terms of this
Agreement or the Basic Documents.
SECTION 2.04.
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 2.05.
Initial Capital Contribution of Owner Trust Estate. The Depositor hereby
sells, assigns, transfers, conveys and sets over to the Owner Trustee, as of
the date hereof, the sum of $1. The Owner Trustee hereby acknowledges
receipt in trust from the Depositor, as of the date hereof, of the foregoing
contribution, which shall constitute the initial Owner Trust Estate and shall
be deposited in the Certificate Distribution Account. The Depositor shall
pay organizational expenses of the Trust as they may arise or shall, upon the
request of the Owner Trustee, promptly reimburse the Owner Trustee for any
such expenses paid by the Owner Trustee.
SECTION 2.06.
Declaration of Trust. The Owner Trustee hereby declares that it will hold
the Owner Trust Estate in trust upon and subject to the conditions set forth
herein for the use and benefit of the Owners, subject to the obligations of
the Trust under the Basic Documents. It is the intention of the parties
hereto that the Trust constitute a business trust under the Business Trust
Statute and that this Agreement constitute the governing instrument of such
business trust. It is the intention of the parties hereto that, solely for
income and franchise tax purposes, (i) so long as there is a single Owner,
the Trust shall be treated as a security arrangement, with the assets of the
Trust being the Receivables and other assets held by the Trust, the owner of
the Receivables being the sole Owner and the Notes being non-recourse debt of
the sole Owner and (ii) if there is more than one Owner, the Trust shall be
treated as a partnership for income and franchise tax purposes, with the
assets of the partnership being the Receivables and other assets held by the
Trust, the partners of the partnership being the Owners (including the
Company as assignee of the Depositor pursuant to the Purchase Agreement, in
its capacity as recipient of distributions from the Reserve Account), and the
Notes being debt of the partnership. The parties agree that, unless
otherwise required by appropriate tax authorities, the Trust will file or
cause to be filed annual or other necessary returns, reports and other forms
consistent with the characterization of the Trust provided in the preceding
sentence for such tax purposes. Effective as of the date hereof, the Owner
Trustee shall have all rights, powers and duties set forth herein and in the
Business Trust Statute with respect to accomplishing the purposes of the
Trust.
SECTION 2.07.
Liability of the Owners. (a) The Depositor shall be liable directly to and
will indemnify any injured party for all losses, claims, damages, liabilities
and expenses of the Trust (including Expenses, to the extent not paid out of
the Owner Trust Estate) to the extent that the Depositor would be liable if
the Trust were a partnership under the Delaware Revised Uniform Limited
Partnership Act in which the Depositor were a general partner; provided,
however, that the Depositor shall not be liable for any losses incurred by a
Certificateholder in the capacity of an investor in the Trust Certificates,
or by a Noteholder in the capacity of an investor in the Notes. In addition,
any third party creditors of the Trust (other than in connection with the
obligations described in the preceding sentence for which the Depositor shall
not be liable) shall be deemed third party beneficiaries of this paragraph.
(b)
Other than to the extent set forth in paragraph (a), no Owner, solely by
virtue of its being the Holder of a Trust Certificate, shall have any
personal liability for any liability or obligation of the Trust.
SECTION 2.08.
Title to Trust Property. Legal title to all the Owner Trust Estate shall be
vested at all times in the Trust as a separate legal entity except where
applicable law in any jurisdiction requires title to any part of the Owner
Trust Estate to be vested in a trustee or trustees, in which case title shall
be deemed to be vested in the Owner Trustee, a co-trustee and/or a separate
trustee, as the case may be.
SECTION 2.09.
Situs of Trust. The Trust will be located and administered in the State of
Delaware. All bank accounts maintained by the Owner Trustee on behalf of the
Trust shall be located in the State of Delaware or the State of New York.
The Trust shall not have any employees in any state other than Delaware;
provided, however, that nothing herein shall restrict or prohibit the Owner
Trustee from having employees within or without the State of Delaware.
Payments will be received by the Trust only in Delaware or New York, and
payments will be made by the Trust only from Delaware or New York. The only
office of the Trust will be at the Corporate Trust Office in Delaware.
SECTION 2.10.
Representations and Warranties of the Depositor. The Depositor hereby
represents and warrants to the Owner Trustee that:
(a)
The Depositor is duly organized and validly existing as a corporation in
good standing under the laws of the State of Delaware, with power and
authority to own its properties and to conduct its business as such
properties are currently owned and such business is presently conducted.
(b)
The Depositor is duly qualified to do business as a foreign corporation in
good standing and has obtained all necessary licenses and approvals in all
jurisdictions in which the ownership or lease of its property or the conduct
of its business shall require such qualifications.
(c)
The Depositor has the power and authority to execute and deliver this
Agreement and to carry out its terms; the Depositor has full power and
authority to sell and assign the property to be sold and assigned to and
deposited with the Trust and the Depositor has duly authorized such sale and
assignment and deposit to the Trust by all necessary corporate action; and
the execution, delivery and performance of this Agreement have been duly
authorized by the Depositor by all necessary corporate action.
(d)
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
bylaws of the Depositor, or any 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.
(e)
There are no proceedings or investigations pending or threatened before any
court, regulatory body, administrative agency or other governmental
instrumentality having jurisdiction over the Depositor or its properties:
(A) asserting the invalidity of this Agreement, (B) seeking to prevent the
consummation of any of the transactions contemplated by this Agreement or
(C) seeking any determination or ruling that might materially and adversely
affect the performance by the Depositor of its obligations under, or the
validity or enforceability of, this Agreement.
SECTION 2.11.
Maintenance of the Demand Note. To the fullest extent permitted by
applicable law, the Depositor agrees that it shall not sell, convey, pledge,
transfer or otherwise dispose of the Demand Note.
ARTICLE III
Trust Certificates and Transfer of Interests
SECTION 3.01.
Initial Ownership. Upon the formation of the Trust by the contribution by
the Depositor pursuant to Section 2.05 and until the issuance of the Trust
Certificates, the Depositor shall be the sole beneficiary of the Trust.
SECTION 3.02.
The Trust Certificates. The Trust Certificates shall be issued in minimum
denominations of $20,000 and in integral multiples of $1,000 in excess
thereof; provided, however, that the Trust Certificates issued to the
Depositor may be issued in such denomination as is required to include any
residual amount. The Trust Certificates shall be executed on behalf of the
Trust by manual or facsimile signature of an authorized officer of the Owner
Trustee. Trust Certificates bearing the manual or facsimile signatures of
individuals who were, at the time when such signatures shall have been
affixed, authorized to sign on behalf of the Trust, shall be validly issued
and entitled to the benefit of this Agreement, notwithstanding that such
individuals or any of them shall have ceased to be so authorized prior to the
authentication and delivery of such Trust Certificates or did not hold such
offices at the date of authentication and delivery of such Trust
Certificates.
A transferee of a Trust Certificate shall become a Certificateholder and
shall be entitled to the rights and subject to the obligations of a
Certificateholder hereunder upon such transferee's acceptance of a Trust
Certificate duly registered in such transferee's name pursuant to Section
3.04.
The initial Holder of the Trust Certificates shall be the Depositor. In the
event that the Depositor transfers any of the Trust Certificates to any other
Person, the Depositor, by its transfer, and such Person, by its acceptance of
the Trust Certificates so transferred, shall be deemed to have agreed to
treat the Trust as a partnership with the Trust Certificates representing
partnership interests therein and the Notes representing debt thereof. Any
transfer by such transferee shall be subject to the same condition.
SECTION 3.03.
Authentication of Trust Certificates. On the Closing Date, the Owner
Trustee shall cause the Trust Certificates in an aggregate principal amount
equal to the Initial Certificate Balance 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, any vice president,
secretary or any assistant treasurer, without further corporate action by the
Depositor, in authorized denominations. No Trust Certificate shall entitle
its Holder to any benefit under this Agreement or be valid for any purpose
unless there shall appear on such Trust Certificate a certificate of
authentication substantially in the form set forth in Exhibit A, executed by
the Owner Trustee or The Chase Manhattan Bank, as the Owner Trustee's
authenticating agent, by manual signature; such authentication shall
constitute conclusive evidence that such Trust Certificate shall have been
duly authenticated and delivered hereunder. All Trust Certificates shall be
dated the date of their authentication.
SECTION 3.04.
Registration of Transfer and Exchange of Trust Certificates. The
Certificate Registrar shall keep or cause to be kept, at the office or agency
maintained pursuant to Section 3.08, a Certificate Register in which, subject to
such reasonable regulations as it may prescribe, the Owner Trustee shall provide
for the registration of Trust Certificates and of transfers and exchanges of
Trust Certificates as herein provided. The Chase Manhattan Bank shall be the
initial Certificate Registrar.
The Trust Certificates have not been and will not be registered under the
Securities Act and will not be listed on any exchange. No transfer of a
Trust Certificate shall be made unless such transfer is made pursuant to an
effective registration statement under the Securities Act and any applicable
state securities laws or is exempt from the registration requirements under
said Act and such state securities laws. In the event that a transfer is to
be made in reliance upon an exemption from the Securities Act and state
securities laws, in order to assure compliance with the Securities Act and
such laws, the Holder desiring to effect such transfer and such Holder's
prospective transferee shall each certify to the Owner Trustee or the
Certificate Registrar and the Depositor in writing the facts surrounding the
transfer in substantially the forms set forth in Exhibit C (the "Transferor
Certificate") and Exhibit D (the "Investment Letter"). Except in the case of
a transfer as to which the proposed transferee has provided an Investment
Letter with respect to a Rule 144A transaction, there shall also be delivered
to the Owner Trustee an Opinion of Counsel that such transfer may be made
pursuant to an exemption from the Securities Act and state securities laws,
which Opinion of Counsel shall not be an expense of the Trust, the Owner
Trustee or the Indenture Trustee (unless it is the transferee from whom such
opinion is to be obtained) or of the Depositor or First Merchants Acceptance
Corporation; provided that such Opinion of Counsel in respect of the
applicable state securities laws may be a memorandum of law rather than an
opinion if such counsel is not licensed in the applicable jurisdiction. The
Depositor shall provide to any Holder of a Trust Certificate and any
prospective transferee designated by any such Holder information regarding
the Trust Certificates and the Receivables and such other information as
shall be necessary to satisfy the condition to eligibility set forth in Rule
144A(d)(4) for transfer of any such Trust Certificate without registration
thereof under the Securities Act pursuant to the registration exemption
provided by Rule 144A. Each Holder of a Trust Certificate desiring to effect
such a transfer shall, and does hereby agree to, indemnify the Trust, the
Owner Trustee, the Indenture Trustee and the Depositor against any liability
that may result if the transfer is not so exempt or is not made in accordance
with federal and state securities laws.
No transfer of a Trust Certificate shall be made to any Person unless the
Owner Trustee has received (A) a certificate in the form of paragraph 3 to
the Investment Letter attached hereto as Exhibit D from such Person to the
effect that such Person is not (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 described in Section 4975(e)(1) of the Code or (iii) any entity
whose underlying assets include plan assets by reason of a plan's investment
in the entity (each, a "Benefit Plan"), (B) an Opinion of Counsel
satisfactory to the Owner Trustee and the Depositor to the effect that the
purchase and holding of such Trust Certificate will not constitute or result
in the assets of the Trust being deemed to be "plan assets" subject to the
prohibited transactions provisions of ERISA or Section 4975 of the Code and
will not subject the Owner Trustee, the Indenture Trustee or the Depositor to
any obligation in addition to those undertaken in the Basic Documents or (C)
if such Person is an insurance company, a representation that such Person is
an insurance company that is purchasing such Trust Certificates with funds
contained in an "insurance company general account" (as such term is defined
in section v(e) of Prohibited Transaction Class Exemption 95-60 ("PTCE 95-
60")) and that the purchase and holding of such Trust Certificates and any
deemed extension of credit from a Certificateholder which is a party in
interest to a Plan, the assets of which are held by such "insurance company"
are covered under PTCE 95-60; provided, however, that the Owner Trustee will
not require such certificate or opinion in the event that, as a result of a
change of law or otherwise, counsel satisfactory to the Owner Trustee has
rendered an Opinion of Counsel to the effect that the purchase and holding of
a Trust Certificate by a Benefit Plan or a Person that is purchasing or
holding such a Trust Certificate with the assets of a Benefit Plan will not
constitute or result in a prohibited transaction under ERISA or Section 4975
of the Code.
No transfer of a Trust Certificate shall be made to any Person unless the
Owner Trustee has received an Opinion of Counsel satisfactory to the Owner
Trustee and the Depositor to the effect that such transfer will not cause the
Trust to be treated as an association or publicly traded partnership taxable
as a corporation for federal or Illinois income tax purposes and that such
transfer will not result in any materially adverse federal income tax
consequences to Noteholders.
The preparation and delivery of the certificate and opinions referred to
above shall not be an expense of the Trust, the Owner Trustee, the Indenture
Trustee, the Servicer or the Depositor.
Upon surrender for registration of transfer of any Trust Certificate at the
office or agency maintained pursuant to Section 3.08, the Owner Trustee shall
execute, authenticate and deliver (or shall cause The Chase Manhattan Bank as
its authenticating agent to authenticate and deliver), in the name of the
designated transferee or transferees, one or more new Trust Certificates in
authorized denominations of a like aggregate amount dated the date of
authentication by the Owner Trustee or any authenticating agent. At the
option of a Certificateholder, Trust Certificates may be exchanged for other
Trust Certificates of authorized denominations of a like aggregate amount
upon surrender of the Trust Certificates to be exchanged at the office or
agency maintained pursuant to Section 3.08.
Every Trust Certificate presented or surrendered for registration of
transfer or exchange shall be accompanied by a written instrument of transfer in
form satisfactory to the Owner Trustee and the Certificate Registrar duly
executed by the Certificateholder or such Certificateholder's attorney duly
authorized in writing. Each Trust Certificate surrendered for registration of
transfer or exchange shall be cancelled and subsequently disposed of by the
Owner Trustee in accordance with its customary practice.
No service charge shall be made for any registration of transfer or exchange
of Trust Certificates, but the Owner Trustee or the Certificate Registrar may
require payment of a sum sufficient to cover any tax or governmental charge
that may be imposed in connection with any transfer or exchange of Trust
Certificates.
The preceding provisions of this Section notwithstanding, the Owner Trustee
shall not make, and the Certificate Registrar shall not register transfers or
exchanges of, Trust Certificates for a period of 15 days preceding the due
date for any payment with respect to the Trust Certificates.
SECTION 3.05.
Mutilated, Destroyed, Lost or Stolen Trust Certificates. If (a) any
mutilated Trust Certificate shall be surrendered to the Certificate
Registrar, or if the Certificate Registrar shall receive evidence to its
satisfaction of the destruction, loss or theft of any Trust Certificate and
(b) there shall be delivered to the Certificate Registrar 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 Trust Certificate has
been acquired by a bona fide purchaser, the Owner Trustee on behalf of the
Trust shall execute and the Owner Trustee or The Chase Manhattan Bank, as the
Owner Trustee's authenticating agent, shall authenticate and deliver, in
exchange for or in lieu of any such mutilated, destroyed, lost or stolen
Trust Certificate, a new Trust Certificate of like tenor and denomination.
In connection with the issuance of any new Trust Certificate under this
Section, the Owner Trustee or the Certificate Registrar may require the
payment of a sum sufficient to cover any tax or other governmental charge
that may be imposed in connection therewith. Any duplicate Trust Certificate
issued pursuant to this Section shall constitute conclusive evidence of
ownership in the Trust, as if originally issued, whether or not the lost,
stolen or destroyed Trust Certificate shall be found at any time.
SECTION 3.06.
Persons Deemed Owners. Prior to due presentation of a Trust Certificate for
registration of transfer, the Owner Trustee, the Certificate Registrar or any
Paying Agent may treat the Person in whose name any Trust Certificate is
registered in the Certificate Register as the owner of such Trust Certificate
for the purpose of receiving distributions pursuant to Section 5.02 and for
all other purposes whatsoever, and none of the Owner Trustee, the Certificate
Registrar or any Paying Agent shall be bound by any notice to the contrary.
SECTION 3.07.
Access to List of Certificateholders' Names and Addresses. The Owner
Trustee shall furnish or cause to be furnished to the Servicer and the
Depositor, within 15 days after receipt by the Owner Trustee of a written
request therefor from the Servicer or the Depositor, a list, in such form as the
Servicer or the Depositor may reasonably require, of the names and addresses
of the Certificateholders as of the most recent Record Date. If (i) three or
more Certificateholders or (ii) one or more Holders of Trust Certificates
evidencing not less than 25% of the Certificate Balance apply in writing to
the Owner Trustee, and such application states that the applicants desire to
communicate with other Certificateholders with respect to their rights under
this Agreement or under the Trust Certificates and such application is
accompanied by a copy of the communication that such applicants propose to
transmit, then the Owner Trustee shall, within five Business Days after the
receipt of such application, afford such applicants access during normal
business hours to the current list of Certificateholders. Each
Certificateholder, by receiving and holding a Trust Certificate, shall be
deemed to have agreed not to hold any of the Depositor, the Certificate
Registrar or the Owner Trustee accountable by reason of the disclosure of its
name and address, regardless of the source from which such information was
derived.
SECTION 3.08.
Maintenance of Office or Agency. The Owner Trustee shall maintain in the
Borough of Manhattan, the City of New York, an office or offices or agency or
agencies where Trust Certificates may be surrendered for registration of
transfer or exchange and where notices and demands to or upon the Owner
Trustee in respect of the Trust Certificates and the Basic Documents may be
served. The Owner Trustee initially designates The Chase Manhattan Bank,
00 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 as its office for such purposes.
The Owner Trustee shall give prompt written notice to the Depositor and to
the Certificateholders of any change in the location of the Certificate
Register or any such office or agency.
SECTION 3.09.
Appointment of Paying Agent. The Paying Agent shall make distributions to
Certificateholders from the Certificate Distribution Account pursuant to
Section 5.02 and shall report the amounts of such distributions to the Owner
Trustee. Any Paying Agent shall have the revocable power to withdraw funds
from the Certificate Distribution Account for the purpose of making the
distributions referred to above. The Owner Trustee may revoke such power and
remove the Paying Agent if the Owner Trustee determines in its sole
discretion that the Paying Agent shall have failed to perform its obligations
under this Agreement in any material respect. The Paying Agent initially
shall be The Chase Manhattan Bank, and any co-paying agent chosen by The
Chase Manhattan Bank and acceptable to the Owner Trustee. The Chase
Manhattan Bank shall be permitted to resign as Paying Agent upon 30 days'
written notice to the Owner Trustee. In the event that The Chase Manhattan
Bank shall no longer be the Paying Agent, the Owner Trustee shall appoint a
successor to act as Paying Agent (which shall be a bank or trust company).
The Owner Trustee shall cause such successor Paying Agent or any additional
Paying Agent appointed by the Owner Trustee to execute and deliver to the
Owner Trustee an instrument in which such successor Paying Agent or
additional Paying Agent shall agree with the Owner Trustee that, as Paying
Agent, such successor Paying Agent or additional Paying Agent will hold all
sums, if any, held by it for payment to the Certificateholders in trust for
the benefit of the Certificateholders entitled thereto until such sums shall
be paid to such Certificateholders. The Paying Agent shall return all
unclaimed funds to the Owner Trustee and upon removal of a Paying Agent such
Paying Agent shall also return all funds in its possession to the Owner
Trustee. The provisions of Sections 7.01, 7.03, 7.04 and 8.01 shall apply to
the Owner Trustee also in its role as Paying Agent, for so long as the Owner
Trustee shall act as Paying Agent and, to the extent applicable, to any other
paying agent appointed hereunder. Any reference in this Agreement to the
Paying Agent shall include any co-paying agent unless the context requires
otherwise.
SECTION 3.10.
ARTICLE IV
Actions by Owner Trustee
SECTION 4.01.
Prior Notice with Respect to Certain Matters. With respect to the following
matters, the Owner Trustee shall not take action unless at least 30 days
before the taking of such action, the Owner Trustee shall have notified the
Certificateholders and the Security Insurer (so long as no Security Insurer
Default shall have occurred and be continuing) in writing of the proposed
action and neither the Security Insurer (so long as no Security Insurer
Default shall have occurred and be continuing) nor the Owners shall have
notified the Owner Trustee in writing prior to the 30th day after such notice
is given that such Owners or the Security Insurer (so long as no Security
Insurer Default shall have occurred and be continuing) have withheld consent
or provided alternative direction:
(a)
the initiation of any claim or lawsuit by the Trust (except claims or
lawsuits brought in connection with the collection of the Receivables) and
the compromise of any action, claim or lawsuit brought by or against the
Trust (except with respect to the aforementioned claims or lawsuits for
collection of the Receivables);
(b)
the election by the Trust to file an amendment to the Certificate of Trust
(unless such amendment is required to be filed under the Business Trust
Statute);
(c)
the amendment of the Indenture by a supplemental indenture in circumstances
where the consent of any Noteholder is required;
(d)
the amendment of the Indenture by a supplemental indenture in circumstances
where the consent of any Noteholder is not required and such amendment would
materially adversely affect the interests of the Owners;
(e)
the amendment, change or modification of the Administration Agreement,
except to cure any ambiguity or to amend or supplement any provision in a manner
or add any provision that would not materially adversely affect the interests of
the Owners; or
(f)
the appointment pursuant to the Indenture of a successor Note Registrar,
Paying Agent or Indenture Trustee or pursuant to this Agreement of a
successor Certificate Registrar, or the consent to the assignment by the Note
Registrar, Paying Agent, Indenture Trustee or Certificate Registrar of its
obligations under the Indenture or this Agreement, as applicable.
SECTION 4.02.
Action by Owners with Respect to Certain Matters. The Owner Trustee shall
not have the power, except upon the written direction of the Owners (with the
consent of the Security Insurer (so long as no Security Insurer Default shall
have occurred and be continuing)), to (a) remove the Administrator under the
Administration Agreement pursuant to Section 8 thereof, (b) appoint a
successor Administrator pursuant to Section 8 of the Administration
Agreement, (c) remove the Servicer under the Sale and Servicing Agreement
pursuant to Section 8.02 thereof, (d) amend the Sale and Servicing Agreement
pursuant to Section 10.01(b) of such document, or (e) except as expressly
provided in the Basic Documents, sell the Receivables after the termination
of the Indenture. The Owner Trustee shall take the actions referred to in
the preceding sentence only upon written instructions signed by the Owners.
SECTION 4.03.
Action by Owners with Respect to Bankruptcy. The Owner Trustee shall not
have the power to commence a voluntary proceeding in bankruptcy relating to
the Trust without the unanimous prior approval of all Owners and the Security
Insurer (so long as no Security Insurer Default shall have occurred and be
continuing) and the delivery to the Owner Trustee by each such Owner of a
certificate certifying that such Owner reasonably believes that the Trust is
insolvent.
SECTION 4.04.
Restrictions on Owners' Power. The Owners shall not direct the Owner
Trustee to take or to refrain from taking any action if such action or inaction
would be contrary to any obligation of the Trust or the Owner Trustee under this
Agreement or any of the Basic Documents or would be contrary to Section 2.03;
nor shall the Owner Trustee be obligated to follow any such direction, if
given.
SECTION 4.05.
Majority Control. Except as expressly provided herein, any action that may
be taken by the Owners under this Agreement may be taken by the Holders of
Trust Certificates evidencing not less than a majority of the Certificate
Balance. Except as expressly provided herein, any written notice of the
Owners delivered pursuant to this Agreement shall be effective if signed by
Holders of Trust Certificates evidencing not less than a majority of the
Certificate Balance at the time of the delivery of such notice.
ARTICLE V
Application of Trust Funds; Certain Duties
SECTION 5.01.
Establishment of Trust Account. The Owner Trustee, for the benefit of the
Certificateholders, shall establish and maintain in the name of the Trust an
Eligible Deposit Account (the "Certificate Distribution Account"), bearing a
designation clearly indicating that the funds deposited therein are held for
the benefit of the Certificateholders.
The Owner Trustee shall possess all right, title and interest in all funds
on deposit from time to time in the Certificate Distribution Account and in all
proceeds thereof. Except as otherwise expressly provided herein, the
Certificate Distribution Account shall be under the sole dominion and control
of the Owner Trustee for the benefit of the Certificateholders. If, at any
time, the Certificate Distribution Account ceases to be an Eligible Deposit
Account, the Owner Trustee (or the Depositor on behalf of the Owner Trustee,
if the Certificate Distribution Account is not then held by the Owner Trustee
or an affiliate thereof) shall within 10 Business Days (or such longer
period, not to exceed 30 calendar days, as to which each Rating Agency may
consent) establish a new Certificate Distribution Account as an Eligible
Deposit Account and shall transfer any cash and/or any investments to such
new Certificate Distribution Account.
SECTION 5.02.
Application of Trust Funds. (a) On each Distribution Date, the Owner
Trustee will distribute to Certificateholders, on a pro rata basis, amounts
deposited in the Certificate Distribution Account pursuant to Section 5.06 of
the Sale and Servicing Agreement with respect to such Distribution Date.
(b)
On each Distribution Date, the Owner Trustee shall send to each
Certificateholder the statement or statements provided to the Owner Trustee
by the Servicer pursuant to Section 5.11 of the Sale and Servicing Agreement
with respect to such Distribution Date.
(c)
In the event that any withholding tax is imposed on the Trust's payment (or
allocations of income) to an Owner, such tax shall reduce the amount
otherwise distributable to the Owner in accordance with this Section. The
Owner Trustee is hereby authorized and directed to retain from amounts
otherwise distributable to the Owners sufficient funds for the payment of any
tax that is legally owed by the Trust (but such authorization shall not
prevent the Owner Trustee from contesting any such tax in appropriate
proceedings and withholding payment of such tax, if permitted by law, pending
the outcome of such proceedings). The amount of any withholding tax imposed
with respect to an Owner shall be treated as cash distributed to such Owner
at the time it is withheld by the Trust and remitted to the appropriate
taxing authority. If there is a possibility that withholding tax is payable
with respect to a distribution (such as a distribution to a non-U.S. Owner),
the Owner Trustee may in its sole discretion withhold such amounts in
accordance with this paragraph (c).
SECTION 5.03.
Method of Payment. Subject to Section 9.01(c), distributions required to be
made to Certificateholders on any Distribution Date shall be made to each
Certificateholder of record on the preceding Record Date either by wire
transfer, in immediately available funds, to the account of such
Certificateholder at a bank or other entity having appropriate facilities
therefor, if such Certificateholder shall have provided to the Certificate
Registrar appropriate written instructions at least five Business Days prior
to such Distribution Date and such Holder's Trust Certificates in the
aggregate evidence a denomination of not less than $1,000,000, or, if not, by
check mailed to such Certificateholder at the address of such
Certificateholder appearing in the Certificate Register.
SECTION 5.04.
No Segregation of Moneys; No Interest. Subject to Sections 5.01 and 5.02,
moneys received by the Owner Trustee hereunder need not be segregated in any
manner except to the extent required by law or the Sale and Servicing
Agreement and may be deposited under such general conditions as may be
prescribed by law, and the Owner Trustee shall not be liable for any interest
thereon.
SECTION 5.05.
Accounting and Reports to the Noteholders, Owners, the Internal Revenue
Service and Others. The Owner Trustee shall deliver to each Owner such
information, reports or statements as may be required by the Code and
applicable Treasury Regulations and as may be required to enable each Owner
to prepare its federal and state income tax returns. Consistent with the
Trust's characterization for tax purposes as a security arrangement for the
issuance of non-recourse debt, no federal income tax return shall be filed on
behalf of the Trust unless either (i) the Owner Trustee shall receive an
Opinion of Counsel that, based on a change in applicable law occurring after
the date hereof, or as a result of a transfer by the Depositor permitted by
Section 3.04, the Code requires such a filing or (ii) the Internal Revenue
Service shall determine that the Trust is required to file such a return.
Notwithstanding the preceding sentence, the Owner Trustee shall file Internal
Revenue Service Form 8832 and elect for the Trust to be treated as a domestic
eligible entity with a single owner that is disregarded as a separate entity,
which election shall remain in effect so long as the Depositor or any other
party is the sole Owner. In the event that the Trust is required to file tax
returns, the Owner Trustee shall prepare or shall cause to be prepared any
tax returns required to be filed by the Trust and shall remit such returns to
the Depositor (or if the Depositor no longer owns any Certificates, the Owner
designated for such purpose by the Depositor to the Owner Trustee in writing)
at lease five (5) days before such returns are due to be filed. The
Depositor (or such designee Owner, as applicable) shall promptly sign such
returns and deliver such returns after signature to the Owner Trustee and
such returns shall be filed by the Owner Trustee with the appropriate tax
authorities. In no event shall the Owner Trustee or the Depositor (or such
designee Owner, as applicable) be liable for any liabilities, costs or
expenses of the Trust or the Noteholders arising out of the application of
any tax law, including federal, state, foreign or local income or excise
taxes or any other tax imposed on or measured by income (or any interest,
penalty or addition with respect thereto or arising from a failure to comply
therewith) except for any such liability, cost or expense attributable to any
act or omission by the Owner Trustee or the Depositor (or such designee
Owner, as applicable), as the case may be, in breach of its obligations under
this Agreement. In the event the Trust is required to file a tax return as
a partnership, the Depositor shall be designated the "tax matters partner" of
the Trust pursuant to Section 6231(a)(7)(A) of the Code and applicable
Treasury Regulations.
ARTICLE VI
Authority and Duties of Owner Trustee
SECTION 6.01.
General Authority. The Owner Trustee is authorized and directed to execute
and deliver the Basic Documents to which the Trust is to be a party and each
certificate or other document attached as an exhibit to or contemplated by
the Basic Documents to which the Trust is to be a party, in each case, in
such form as the Depositor shall approve, as evidenced conclusively by the
Owner Trustee's execution thereof. In addition to the foregoing, the Owner
Trustee is authorized, but shall not be obligated, to take all actions
required of the Trust pursuant to the Basic Documents. The Owner Trustee is
further authorized from time to time to take such action as the Administrator
recommends with respect to the Basic Documents.
SECTION 6.02.
General Duties. It shall be the duty of the Owner Trustee to discharge (or
cause to be discharged) all of its responsibilities pursuant to the terms of
this Agreement and the Basic Documents to which the Trust is a party and to
administer the Trust in the interest of the Owners, subject to the Basic
Documents and in accordance with the provisions of this Agreement.
Notwithstanding the foregoing, the Owner Trustee shall be deemed to have
discharged its duties and responsibilities hereunder and under the Basic
Documents to the extent the Administrator has agreed in the Administration
Agreement to perform any act or to discharge any duty of the Owner Trustee
hereunder or under any Basic Document, and the Owner Trustee shall not be
held liable for the default or failure of the Administrator to carry out its
obligations under the Administration Agreement.
SECTION 6.03.
Action upon Instruction. (a) Subject to Article IV and in accordance with
the terms of the Basic Documents, the Owners may by written instruction
direct the Owner Trustee in the management of the Trust. Such direction may
be exercised at any time by written instruction of the Owners pursuant to
Article IV.
(b)
The Owner Trustee shall not be required to take any action hereunder or
under any Basic Document if the Owner Trustee shall have reasonably determined,
or shall have been advised by counsel, that such action is likely to result in
liability on the part of the Owner Trustee or is contrary to the terms hereof
or of any Basic Document or is otherwise contrary to law.
(c)
Whenever the Owner Trustee is unable to decide between alternative courses
of action permitted or required by the terms of this Agreement or under any
Basic Document, the Owner Trustee shall promptly give notice (in such form as
shall be appropriate under the circumstances) to the Owners 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 Owners received, the Owner Trustee shall not be liable on account of
such action to any Person. If the Owner Trustee shall not have received
appropriate instruction within 10 days of such notice (or within such shorter
period of time as reasonably may be specified in such notice or may be
necessary under the circumstances) it may, but shall be under no duty to,
take or refrain from taking such action not inconsistent with this Agreement
or the Basic Documents, as it shall deem to be in the best interests of the
Owners, and shall have no liability to any Person for such action or
inaction.
(d)
In the event that the Owner Trustee is unsure as to the application of any
provision of this Agreement or any Basic Document or any such provision is
ambiguous as to its application, or is, or appears to be, in conflict with
any other applicable provision, or in the event that this Agreement permits
any determination by the Owner Trustee or is silent or is incomplete as to
the course of action that the Owner Trustee is required to take with respect
to a particular set of facts, the Owner Trustee may give notice (in such form
as shall be appropriate under the circumstances) to the Owners 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 shall not be liable, on account of such action or inaction, to
any Person. If the Owner Trustee shall not have received appropriate
instruction within 10 days of such notice (or within such shorter period of
time as reasonably may be specified in such notice or may be necessary under
the circumstances) it may, but shall be under no duty to, take or refrain
from taking such action not inconsistent with this Agreement or the Basic
Documents, as it shall deem to be in the best interests of the Owners, and
shall have no liability to any Person for such action or inaction.
SECTION 6.04.
No Duties Except as Specified in this Agreement or in Instructions. The
Owner Trustee shall not have any duty or obligation to manage, make any
payment with respect to, register, record, sell, dispose of, or otherwise
deal with the Owner Trust Estate, or to otherwise take or refrain from taking
any action under, or in connection with, any document contemplated hereby to
which the Owner Trustee is a party, except as expressly provided by the terms
of this Agreement or in any document or written instruction received by the
Owner Trustee pursuant to Section 6.03; and no implied duties or obligations
shall be read into this Agreement or any Basic Document against the Owner
Trustee. The Owner Trustee shall have no responsibility for filing any
financing or continuation statement in any public office at any time or to
otherwise perfect or maintain the perfection of any security interest or lien
granted to it hereunder or to prepare or file any Securities and Exchange
Commission filing for the Trust or to record this Agreement or any Basic
Document. The Owner Trustee nevertheless agrees that it will, at its own
cost and expense, promptly take all action as may be necessary to discharge
any liens on any part of the Owner Trust Estate that result from actions by,
or claims against, the Owner Trustee that are not related to the ownership or
the administration of the Owner Trust Estate.
SECTION 6.05.
No Action Except Under Specified Documents or Instructions. The Owner
Trustee shall not manage, control, use, sell, dispose of or otherwise deal
with any part of the Owner Trust Estate except (i) in accordance with the
powers granted to and the authority conferred upon the Owner Trustee pursuant
to this Agreement, (ii) in accordance with the Basic Documents and (iii) in
accordance with any document or instruction delivered to the Owner Trustee
pursuant to Section 6.03.
SECTION 6.06.
Restrictions. The Owner Trustee shall not take any action (a) that is
inconsistent with the purposes of the Trust set forth in Section 2.03 or
(b) that, to the actual knowledge of the Owner Trustee, would result in the
Trust's becoming taxable as a corporation for federal or Illinois income tax
purposes. The Owners shall not direct the Owner Trustee to take action that
would violate the provisions of this Section.
ARTICLE VII
Concerning the Owner Trustee
SECTION 7.01.
Acceptance of Trusts and Duties. The Owner Trustee accepts the trusts
hereby created and agrees to perform its duties hereunder 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 shall not be answerable or accountable
hereunder or under any Basic Document under any circumstances, except (i) for
its own willful misconduct or negligence or (ii) in the case of the
inaccuracy of any representation or warranty contained in Section 7.03
expressly made by the Owner Trustee. In particular, but not by way of
limitation (and subject to the exceptions set forth in the preceding
sentence):
(a)
The Owner Trustee shall not be liable for any error of judgment made by a
Trust Officer of the Owner Trustee;
(b)
The Owner Trustee shall not be liable with respect to any action taken or
omitted to be taken by it in accordance with the instructions of the
Administrator or any Owner;
(c)
No provision of this Agreement or any Basic Document shall require the Owner
Trustee to expend or risk funds or otherwise incur any financial liability in
the performance of any of its rights or powers hereunder or under any Basic
Document if the Owner Trustee shall have reasonable grounds for believing
that repayment of such funds or adequate indemnity against such risk or
liability is not reasonably assured or provided to it;
(d)
Under no circumstances shall the Owner Trustee be liable for indebtedness
evidenced by or arising under any of the Basic Documents, including the
principal of and interest on the Notes;
(e)
The Owner Trustee shall not be responsible for or in respect of the validity
or sufficiency of this Agreement or for the due execution hereof by the
Depositor or for the form, character, genuineness, sufficiency, value or
validity of any of the Owner Trust Estate, or for or in respect of the
validity or sufficiency of the Basic Documents, other than the certificate of
authentication on the Trust Certificates, and the Owner Trustee shall in no
event assume or incur any liability, duty or obligation to any Noteholder or
to any Owner, other than as expressly provided for herein or expressly agreed
to in the Basic Documents;
(f)
The Owner Trustee shall not be liable for the default or misconduct of the
Administrator, the Depositor, the Servicer, the Indenture Trustee or the
Backup Servicer under any of the Basic Documents or otherwise, and the Owner
Trustee shall have no obligation or liability to perform the obligations of
the Trust under this Agreement or the Basic Documents that are required to be
performed by the Administrator under the Administration Agreement, the
Indenture Trustee under the Indenture or the Depositor, the Servicer or the
Backup Servicer under the Sale and Servicing Agreement; and
(g)
The Owner Trustee shall be under no obligation to exercise any of the rights
or powers vested in it by this Agreement, or to institute, conduct or defend
any litigation under this Agreement or otherwise or in relation to this
Agreement or any Basic Document, at the request, order or direction of any of
the Owners, unless such Owners have offered to the Owner Trustee security or
indemnity satisfactory to it against the costs, expenses and liabilities that
may be incurred by the Owner Trustee therein or thereby. The right of the
Owner Trustee to perform any discretionary act enumerated in this Agreement
or in any Basic Document shall not be construed as a duty, and the Owner
Trustee shall not be answerable for other than its negligence or willful
misconduct in the performance of any such act.
SECTION 7.02.
Furnishing of Documents. The Owner Trustee shall furnish to the Owners,
promptly upon receipt of a written request therefor, duplicates or copies of
all reports, notices, requests, demands, certificates, financial statements
and any other instruments furnished to the Owner Trustee under the Basic
Documents.
SECTION 7.03.
Representations and Warranties. The Owner Trustee hereby represents and
warrants to the Depositor, for the benefit of the Owners, that:
(a)
It is a 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 or the delivery by it of this Agreement, nor the
consummation by it of the transactions contemplated hereby, nor compliance by
it with any of the terms or provisions hereof will contravene any federal or
Delaware law, governmental rule or regulation governing the banking or trust
powers of the Owner Trustee or any judgment or order binding on it, or
constitute any default under its charter documents or bylaws or any
indenture, mortgage, contract, agreement or instrument to which it is a party
or by which any of its properties may be bound.
(d)
It is a corporation satisfying the provisions of Section 3807(a) of the
Business Trust Statute; authorized to exercise corporate trust powers; having
a combined capital and surplus of at least $50,000,000 and subject to
supervision or examination by federal or state authorities; and having (or
having a parent that has) time deposits that are rated at least A-1 by
Standard & Poor's and P-1 by Moody's.
SECTION 7.04.
Reliance; Advice of Counsel. (a) The Owner Trustee shall incur no
liability to anyone in acting upon any signature, instrument, notice,
resolution, request, consent, order, certificate, report, opinion, bond, or
other document or paper believed by it to be genuine and believed by it to be
signed by the proper party or parties. The Owner Trustee may accept a
certified copy of a resolution of the board of directors or other governing
body of any corporate party as conclusive evidence that such resolution has
been duly adopted by such body and that the same is in full force and effect.
As to any fact or matter the method of determination of which is not
specifically prescribed herein, the Owner Trustee may for all purposes hereof
rely on a certificate, signed by the president or any vice president or by
the treasurer or other authorized officers of the relevant party, as to such
fact or matter, and such certificate shall constitute full protection to the
Owner Trustee for any action taken or omitted to be taken by it in good faith
in reliance thereon.
(b)
In the exercise or administration of the trusts hereunder and in the
performance of its duties and obligations under this Agreement or the Basic
Documents, the Owner Trustee (i) may act directly or through its agents or
attorneys pursuant to agreements entered into with any of them, and the Owner
Trustee shall not be liable for the conduct or misconduct of such agents or
attorneys if such agents or attorneys shall have been selected by the Owner
Trustee with reasonable care, and (ii) may consult with counsel, accountants
and other skilled Persons to be selected with reasonable care and employed by
it. The Owner Trustee shall not be liable for anything done, suffered or
omitted in good faith by it in accordance with the written opinion or advice
of any such counsel, accountants or other such Persons and not contrary to
this Agreement or any Basic Document.
SECTION 7.05.
Not Acting in Individual Capacity. Except as provided in this Article VII,
in accepting the trusts hereby created, Chase Manhattan Bank Delaware acts
solely as Owner Trustee hereunder and not in its individual capacity, and all
Persons having any claim against the Owner Trustee by reason of the
transactions contemplated by this Agreement or any Basic Document shall look
only to the Owner Trust Estate for payment or satisfaction thereof.
SECTION 7.06.
Owner Trustee Not Liable for Trust Certificates or for Receivables. The
recitals contained herein and in the Trust Certificates (other than the
signature and countersignature of the Owner Trustee on the Trust
Certificates) shall be taken as the statements of the Depositor, and the
Owner Trustee assumes no responsibility for the correctness thereof. Except
as set forth in Section 7.03, the Owner Trustee makes no representations as
to the validity or sufficiency of this Agreement, of any Basic Document or of
the Trust Certificates (other than the signature and countersignature of the
Owner Trustee on the Trust Certificates) or the Notes, or of any Receivable
or related documents. The Owner Trustee shall at no time have any
responsibility or liability for or with respect to the legality, validity and
enforceability of any Receivable or the perfection and priority of any
security interest created by any Receivable in any Financed Vehicle or the
maintenance of any such perfection and priority, or for or with respect to
the sufficiency of the Owner Trust Estate or its ability to generate the
payments to be distributed to Certificateholders under this Agreement or the
Noteholders under the Indenture, including, without limitation: the
existence, condition and ownership of any Financed Vehicle; the existence and
enforceability of any insurance thereon; the existence and contents of any
Receivable on any computer or other record thereof; the validity of the
assignment of any Receivable to the Trust or of any intervening assignment;
the completeness of any Receivable; the performance or enforcement of any
Receivable; the compliance by the Depositor, the Servicer or the Backup
Servicer with any warranty or representation made under any Basic Document or
in any related document or the accuracy of any such warranty or
representation, or any action of the Administrator, the Indenture Trustee,
the Servicer or the Backup Servicer or any subservicer taken in the name of
the Owner Trustee.
SECTION 7.07.
Owner Trustee May Own Trust Certificates and Notes. The Owner Trustee in
its individual or any other capacity may become the owner or pledgee of Trust
Certificates or Notes and may deal with the Depositor, the Administrator, the
Indenture Trustee and the Servicer in banking transactions with the same
rights as it would have if it were not Owner Trustee.
SECTION 7.08.
Pennsylvania Motor Vehicle Sales Finance Act Licenses. The Owner Trustee,
in its individual capacity, shall use its best efforts to maintain, and the
Owner Trustee, as Owner Trustee, shall cause the Trust to use its best
efforts to maintain, the effectiveness of all licenses required under the
Pennsylvania Motor Vehicle Sales Finance Act in connection with this
Agreement and the Basic Documents and the transactions contemplated hereby
and thereby until such time as the Trust shall terminate in accordance with
the terms hereof.
ARTICLE VIII
Compensation of Owner Trustee
SECTION 8.01.
Owner Trustee's Fees and Expenses. The Administrator shall pay to the Owner
Trustee as compensation for its services hereunder such fees as have been
separately agreed upon before the date hereof between the Servicer and the
Owner Trustee, and the Administrator shall reimburse the Owner Trustee 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.
SECTION 8.02.
Indemnification. The Administrator shall be liable as primary obligor for,
and shall indemnify the Owner Trustee and its successors, assigns, agents and
servants (collectively, the "Indemnified Parties") from and against, any and
all liabilities, obligations, losses, damages, taxes, claims, actions and
suits, and any and all reasonable costs, expenses and disbursements
(including reasonable legal fees and expenses) of any kind and nature
whatsoever (collectively, "Expenses") which may at any time be imposed on,
incurred by, or asserted against the Owner Trustee or any Indemnified Party
in any way relating to or arising out of this Agreement, the Basic Documents,
the Owner Trust Estate, the administration of the Owner Trust Estate or the
action or inaction of the Owner Trustee hereunder, except only that the
Administrator shall not be liable for or required to indemnify an Indemnified
Party from and against Expenses arising or resulting from any of the matters
described in the third sentence of Section 7.01. The indemnities contained
in this Section shall survive the resignation or termination of the Owner
Trustee or the termination of this Agreement. In any event of any claim,
action or proceeding for which indemnity will be sought pursuant to this
Section, the Owner Trustee's choice of legal counsel shall be subject to the
approval of the Administrator, which approval shall not be unreasonably
withheld.
SECTION 8.03.
Payments to the Owner Trustee. Any amounts paid to the Owner Trustee
pursuant to this Article VIII shall be deemed not to be a part of the Owner
Trust Estate immediately after such payment.
ARTICLE IX
Termination of Trust Agreement
SECTION 9.01.
Termination of Trust Agreement. (a) This Agreement (other than
Article VIII) and the Trust shall terminate and be of no further force or
effect (i) upon the final distribution by the Owner Trustee of all moneys or
other property or proceeds of the Owner Trust Estate in accordance with the
terms of the Indenture, the Sale and Servicing Agreement and Article V or
(ii) at the time provided in Section 9.02. The bankruptcy, liquidation,
dissolution, death or incapacity of any Owner, other than the Depositor as
described in Section 9.02, shall not (x) operate to terminate this Agreement
or the Trust or (y) entitle such Owner'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
or (z) otherwise affect the rights, obligations and liabilities of the
parties hereto.
(b)
Except as provided in Section 9.01(a), neither the Depositor nor any Owner
shall be entitled to revoke or terminate the Trust.
(c)
Notice of any termination of the Trust, specifying the Distribution Date
upon which Certificateholders shall surrender their Trust Certificates to the
Paying Agent for payment of the final distribution and cancellation, shall be
given by the Owner Trustee by letter to Certificateholders mailed within five
Business Days of receipt of notice of such termination from the Servicer
given pursuant to Section 9.01(c) of the Sale and Servicing Agreement,
stating (i) the Distribution Date upon or with respect to which final payment
of the Trust Certificates shall be made upon presentation and surrender of
the Trust Certificates at the office of the Paying Agent therein designated,
(ii) the amount of any such final payment and (iii) that the Record Date
otherwise applicable to such Distribution Date is not applicable, payments
being made only upon presentation and surrender of the Trust Certificates at
the office of the Paying Agent therein specified. The Owner Trustee shall
give such notice to the Certificate Registrar (if other than the Owner
Trustee) and the Paying Agent at the time such notice is given to
Certificateholders. Upon presentation and surrender of the Trust
Certificates, the Paying Agent shall cause to be distributed to
Certificateholders amounts distributable on such Distribution Date pursuant
to Section 5.02.
In the event that all of the Certificateholders shall not surrender their
Trust Certificates for cancellation within six months after the date
specified in the above mentioned written notice, the Owner Trustee shall give
a second written notice to the remaining Certificateholders to surrender
their Trust Certificates for cancellation and receive the final distribution
with respect thereto. If within one year after the second notice all the
Trust Certificates shall not have been surrendered for cancellation, the
Owner Trustee may take appropriate steps, or may appoint an agent to take
appropriate steps, to contact the remaining Certificateholders concerning
surrender of their Trust Certificates, and the cost thereof shall be paid out
of the funds and other assets that shall remain subject to this Agreement.
Any funds remaining in the Trust after exhaustion of such remedies shall be
distributed by the Owner Trustee to the Depositor, subject to applicable
escheat laws.
(d)
Upon the winding up of the Trust and its termination, the Owner Trustee
shall cause the Certificate of Trust to be cancelled by filing a certificate of
cancellation with the Secretary of State in accordance with the provisions of
Section 3810 of the Business Trust Statute.
SECTION 9.02.
Dissolution upon Bankruptcy of the Depositor. In the event that an
Insolvency Event shall occur with respect to the Depositor, this Agreement
shall be terminated in accordance with Section 9.01 90 days after the date
of such Insolvency Event, unless, before the end of such 90-day period, the
Owner Trustee shall have received written instructions from (a) Holders
(other than the Depositor) of Certificates representing more than 50% of the
Certificate Balance (not including the Certificate Balance of the Trust
Certificates held by the Depositor) and (b) each of the (i) Holders (as
defined in the Indenture) of Class A-1 Notes representing more than 50% of
the Outstanding Amount of the Class A-1 Notes, (ii) Holders (as defined in
the Indenture) of Class A-2 Notes representing more than 50% of the
Outstanding Amount of the Class A-2 Notes and (iii) the Security Insurer (so
long as no Security Insurer Default shall have occurred and be continuing),
to the effect that each such party disapproves of the termination of the
Trust. Promptly after the occurrence of any Insolvency Event with respect to
the Depositor, (A) the Depositor shall give the Indenture Trustee and the
Owner Trustee written notice of such Insolvency Event, (B) the Owner Trustee
shall, upon the receipt of such written notice from the Depositor, give
prompt written notice to the Certificateholders and the Indenture Trustee, of
the occurrence of such event and (C) the Indenture Trustee shall, upon
receipt of written notice of such Insolvency Event from the Owner Trustee or
the Depositor, give prompt written notice to the Noteholders of the
occurrence of such event; provided, however, that any failure to give a
notice required by this sentence shall not prevent or delay, in any manner,
a termination of the Trust pursuant to the first sentence of this Section
9.02. Upon a termination pursuant to this Section, the Owner Trustee shall
direct the Indenture Trustee promptly to sell the assets of the Trust (other
than the Trust Accounts and the Certificate Distribution Account) in a
commercially reasonable manner and on commercially reasonable terms. The
proceeds of such a sale of the assets of the Trust shall be treated as
collections under the Sale and Servicing Agreement.
ARTICLE X
Successor Owner Trustees and Additional Owner Trustees
SECTION 10.01.
Eligibility Requirements for Owner Trustee. The Owner Trustee shall at all
times be a corporation satisfying the provisions of Section 3807(a) of the
Business Trust Statute; authorized to exercise corporate trust powers; having
a combined capital and surplus of at least $50,000,000 and subject to
supervision or examination by federal or state authorities; and having (or
having a parent that has) time deposits that are rated at least A-1 by
Standard & Poor's and P-1 by Moody's. If such corporation shall publish
reports of condition at least annually pursuant to law or to the requirements
of the aforesaid supervising or examining authority, then for the purpose of
this Section, the combined capital and surplus of such corporation shall be
deemed to be its combined capital and surplus as set forth in its most recent
report of condition so published. In case at any time the Owner Trustee
shall cease to be eligible in accordance with the provisions of this Section,
the Owner Trustee shall resign immediately in the manner and with the effect
specified in Section 10.02.
SECTION 10.02.
Resignation or Removal of Owner Trustee. The Owner Trustee may at any time
resign and be discharged from the trusts hereby created by giving written
notice thereof to the Administrator. Upon receiving such notice of
resignation, the Administrator shall promptly appoint a successor Owner
Trustee by written instrument, in duplicate, one copy of which instrument
shall be delivered to the resigning Owner Trustee and one copy to the
successor Owner Trustee. If no successor Owner Trustee shall have been so
appointed and have accepted appointment within 30 days after the giving of
such notice of resignation, the resigning Owner Trustee may petition any
court of competent jurisdiction for the appointment of a successor Owner
Trustee.
If at any time the Owner Trustee shall cease to be eligible in accordance
with the provisions of Section 10.01 and shall fail to resign after written
request therefor by the Administrator, or if at any time the Owner Trustee
shall be legally unable to act, or shall be adjudged bankrupt or insolvent,
or a receiver of the Owner Trustee or of its property shall be appointed, or
any public officer shall take charge or control of the Owner Trustee or of
its property or affairs for the purpose of rehabilitation, conservation or
liquidation, then the Administrator may remove the Owner Trustee. If the
Administrator shall remove the Owner Trustee under the authority of the
immediately preceding sentence, the Administrator shall promptly appoint a
successor Owner Trustee by written instrument, in duplicate, one copy of
which instrument shall be delivered to the outgoing Owner Trustee so removed
and one copy to the successor Owner Trustee, and shall pay all fees owed to
the outgoing Owner Trustee.
Any resignation or removal of the Owner Trustee and appointment of a
successor Owner Trustee pursuant to any of the provisions of this Section
shall not become effective until acceptance of appointment by the successor
Owner Trustee pursuant to Section 10.03 and payment of all fees and expenses
owed to the outgoing Owner Trustee. The Administrator shall provide notice
of such resignation or removal of the Owner Trustee to each Rating Agency and
the Security Insurer (so long as no Security Insurer Default shall have
occurred and be continuing).
SECTION 10.03.
Successor Owner Trustee. Any successor Owner Trustee appointed pursuant to
Section 10.01 or 10.02 shall execute, acknowledge and deliver to the
Administrator and to its predecessor Owner Trustee an instrument accepting
such appointment under this Agreement, and thereupon the resignation or
removal of the predecessor Owner Trustee shall become effective, and such
successor Owner Trustee, without any further act, deed or conveyance, shall
become fully vested with all the rights, powers, duties and obligations of
its predecessor under this Agreement, with like effect as if originally named
as Owner Trustee. The predecessor Owner Trustee shall, upon payment of its
fees and expenses, deliver to the successor Owner Trustee all documents and
statements and monies held by it under this Agreement; and the Administrator
and the predecessor Owner Trustee shall execute and deliver such instruments
and do such other things as may reasonably be required for fully and
certainly vesting and confirming in the successor Owner Trustee all such
rights, powers, duties and obligations.
No successor Owner Trustee shall accept appointment as provided in this
Section unless at the time of such acceptance such successor Owner Trustee
shall be eligible pursuant to Section 10.01.
Upon acceptance of appointment by a successor Owner Trustee pursuant to this
Section, the Administrator shall mail notice thereof to all
Certificateholders, the Indenture Trustee, the Noteholders, the Security
Insurer (so long as no Security Insurer Default shall have occurred and be
continuing) and the Rating Agencies. If the Administrator shall fail to mail
such notice within 10 days after acceptance of such appointment by the
successor Owner Trustee, the successor Owner Trustee shall cause such notice
to be mailed at the expense of the Administrator.
SECTION 10.04.
Merger or Consolidation of Owner Trustee. Any corporation into which the
Owner Trustee may be merged or converted or with which it may be
consolidated, or any corporation resulting from any merger, conversion or
consolidation to which the Owner Trustee shall be a party, or any corporation
succeeding to all or substantially all of the corporate trust business of the
Owner Trustee, shall be the successor of the Owner Trustee hereunder, without
the execution or filing of any instrument or any further act on the part of
any of the parties hereto, anything herein to the contrary notwithstanding;
provided, that such corporation shall be eligible pursuant to Section 10.01
and, provided, further, that the Owner Trustee shall mail notice of such
merger or consolidation to each Rating Agency and the Security Insurer (so
long as no Security Insurer Default shall have occurred and be continuing).
SECTION 10.05.
Appointment of Co-Trustee or Separate Trustee. Notwithstanding any other
provisions of this Agreement, at any time, for the purpose of meeting any
legal requirements of any jurisdiction in which any part of the Owner Trust
Estate or any Financed Vehicle may at the time be located, the Administrator
and the Owner Trustee acting jointly shall have the power and shall execute
and deliver all instruments to appoint one or more Persons approved by the
Administrator and Owner Trustee to act as co-trustee, jointly with the Owner
Trustee, or as separate trustee or separate trustees, of all or any part of
the 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
Administrator and the Owner Trustee may consider necessary or desirable. If
the Administrator shall not have joined in such appointment within 15 days
after the receipt by it of a request so to do, the Owner Trustee alone shall
have the power to make such appointment. No co-trustee or separate trustee
under this Agreement shall be required to meet the terms of eligibility as a
successor Owner Trustee pursuant to Section 10.01 and no notice of the
appointment of any co-trustee or separate trustee shall be required pursuant
to Section 10.03.
Each separate trustee and co-trustee shall, to the extent permitted by law,
be appointed and act subject to the following provisions and conditions:
(a)
All rights, powers, duties and obligations conferred or imposed upon the
Owner Trustee shall be conferred upon and exercised or performed by the Owner
Trustee and such separate trustee or co-trustee jointly (it being understood
that such separate trustee or co-trustee is not authorized to act separately
without the Owner Trustee joining in such act), except to the extent that
under any law of any jurisdiction in which any particular act or acts are to
be performed, the Owner Trustee shall be incompetent or unqualified to
perform such act or acts, in which event such rights, powers, duties and
obligations (including the holding of title to the Owner Trust Estate or any
portion thereof in any such jurisdiction) shall be exercised and performed
singly by such separate trustee or co-trustee, but solely at the direction of
the Owner Trustee;
(b)
No trustee under this Agreement shall be personally liable by reason of any
act or omission of any other trustee under this Agreement; and
(c)
The Administrator and the Owner Trustee acting jointly may at any time
accept the resignation of or remove any separate trustee or co-trustee.
Any notice, request or other writing given to the Owner Trustee shall be
deemed to have been given to each of the then separate trustees and co-
trustees, as effectively as if given to each of them. Every instrument
appointing any separate trustee or co-trustee shall refer to this Agreement
and the conditions of this Article. Each separate trustee and co-trustee,
upon its acceptance of the trusts conferred, shall be vested with the estates
or property specified in its instrument of appointment, either jointly with
the Owner Trustee or separately, as may be provided therein, subject to all
the provisions of this Agreement, specifically including every provision of
this Agreement relating to the conduct of, affecting the liability of, or
affording protection to, the Owner Trustee. Each such instrument shall be
filed with the Owner Trustee and a copy thereof given to the Administrator.
Any separate trustee or co-trustee may at any time appoint the Owner Trustee
as its agent or attorney-in-fact with full power and authority, to the extent
not prohibited by law, to do any lawful act under or in respect of this
Agreement on its behalf and in its name. If any separate trustee or co-
trustee shall die, become incapable of acting, resign or be removed, all of
its estates, properties, rights, remedies and trusts shall vest in and be
exercised by the Owner Trustee, to the extent permitted by law, without the
appointment of a new or successor co-trustee or separate trustee.
ARTICLE XI
Miscellaneous
SECTION 11.01.
Supplements and Amendments. This Agreement may be amended by the Depositor
and the Owner Trustee, with the consent of the Security Insurer (so long as
no Security Insurer Default shall have occurred and be continuing) and with
prior written notice to each Rating Agency, without the consent of any of the
Noteholders or the Certificateholders, to cure any ambiguity, to correct or
supplement any provisions in this Agreement or for the purpose of adding any
provisions to or changing in any manner or eliminating any of the provisions
in this Agreement or of modifying in any manner the rights of the Noteholders
or the Certificateholders; provided, however, that such action shall not, as
evidenced by an Opinion of Counsel, adversely affect in any material respect
the interests of any Noteholder or Certificateholder.
This Agreement may also be amended from time to time by the Depositor and
the Owner Trustee, with the consent of the Security Insurer (so long as no
Security Insurer Default shall have occurred and be continuing) and with
prior written notice to each Rating Agency, with the consent of the Holders
(as defined in the Indenture) of Notes evidencing not less than a majority of
the Outstanding Amount of the Notes and the consent of the Holders of
Certificates evidencing not less than a majority of the Certificate Balance,
for the purpose of adding any provisions to or changing in any manner or
eliminating any of the provisions of this Agreement or of modifying in any
manner the rights of the Noteholders or the Certificateholders; provided,
however, that no such amendment shall (a) increase or reduce in any manner
the amount of, or accelerate or delay the timing of, collections of payments
on Receivables or distributions that shall be required to be made for the
benefit of the Noteholders or the Certificateholders or (b) reduce the
aforesaid percentage of the Outstanding Amount of the Notes and the
Certificate Balance required to consent to any such amendment, without the
consent of Holders of all the outstanding Notes and Certificates.
Promptly after the execution of any such amendment or consent, the Owner
Trustee shall furnish written notification of the substance of such amendment
or consent to each Certificateholder, the Indenture Trustee and each Rating
Agency.
It shall not be necessary for the consent of Certificateholders, Noteholders
or the Security Insurer pursuant to this Section to approve the particular
form of any proposed amendment or consent, but it shall be sufficient if such
consent shall approve the substance thereof. The manner of obtaining such
consents (and any other consents of Certificateholders provided for in this
Agreement or in any other Basic Document) and of evidencing the authorization
of the execution thereof by Certificateholders shall be subject to such
reasonable requirements as the Owner Trustee may prescribe.
Promptly after the execution of any amendment to the Certificate of Trust,
the Owner Trustee shall cause the filing of such amendment with the Secretary
of State.
Prior to the execution of any amendment to this Agreement or the Certificate
of Trust, the Owner Trustee shall be entitled to receive and rely upon an
Opinion of Counsel stating that the execution of such amendment is authorized
or permitted by this Agreement. The Owner Trustee may, but shall not be
obligated to, enter into any such amendment that affects the Owner Trustee's
own rights, duties or immunities under this Agreement or otherwise.
In connection with the execution of any amendment to this Trust Agreement or
any amendment of any other agreement to which the Issuer is a party, the
Owner Trustee shall be entitled to receive and conclusively rely upon an
Opinion of Counsel to the effect that such amendment is authorized or
permitted by the Basic Documents and that all conditions precedent in the
Basic Documents for the execution and delivery thereof by the Issuer or the
Owner Trustee, as the case may be, have been satisfied.
SECTION 11.02.
No Legal Title to Owner Trust Estate in Owners. Neither the Depositor nor
the Owners shall have legal title to any part of the Owner Trust Estate. The
Owners shall be entitled to receive distributions with respect to their
undivided ownership interest therein only in accordance with Articles V and
IX. No transfer, by operation of law or otherwise, of any right, title or
interest of the Owners to and in their ownership interest in the Owner Trust
Estate shall operate to terminate this Agreement or the trusts hereunder or
entitle any transferee to an accounting or to the transfer to it of legal
title to any part of the Owner Trust Estate.
SECTION 11.03.
Limitations on Rights of Others. Except for Section 2.07, the provisions of
this Agreement are solely for the benefit of the Owner Trustee, the
Depositor, the Owners, the Administrator, the Security Insurer and, to the
extent expressly provided herein, the Indenture Trustee and the Noteholders,
and nothing in this Agreement (other than Section 2.07 hereof), whether
express or implied, shall be construed to give to any other Person any legal
or equitable right, remedy or claim in the Owner Trust Estate or under or in
respect of this Agreement or any covenants, conditions or provisions
contained herein.
SECTION 11.04.
Notices. (a) Unless otherwise expressly specified or permitted by the
terms hereof, all notices shall be in writing and shall be deemed given upon
receipt by the intended recipient or three Business Days after mailing if
mailed by certified mail, postage prepaid (except that notice to the Owner
Trustee shall be deemed given only upon actual receipt by the Owner Trustee),
if to the Owner Trustee, addressed to the Corporate Trust Office; if to the
Depositor, addressed to First Merchants Auto Receivables Corporation II, 000
Xxxx Xxxx Xxxx, Xxxxx 000X, Xxxxxxxxx, Xxxxxxxx 00000, Attention: Secretary;
or, as to each party, at such other address as shall be designated by such
party in a written notice to each other party.
(b)
Any notice required or permitted to be given to a Certificateholder shall be
given by first-class mail, postage prepaid, at the address of such
Certificateholder as shown in the Certificate Register. Any notice so mailed
within the time prescribed in this Agreement shall be conclusively presumed
to have been duly given, whether or not the Certificateholder receives such
notice.
SECTION 11.05.
Severability. Any provision of this Agreement that is prohibited or
unenforceable in any jurisdiction shall, as to such jurisdiction, be
ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.
SECTION 11.06.
Separate Counterparts. This Agreement may be executed by the parties hereto
in separate counterparts, each of which when so executed and delivered shall
be an original, but all such counterparts shall together constitute but one
and the same instrument.
SECTION 11.07.
Successors and Assigns. All covenants and agreements contained herein shall
be binding upon, and inure to the benefit of, each of the Depositor and its
permitted assignees, the Owner Trustee and its successors and each Owner and
its successors and permitted assigns, all as herein provided. Any request,
notice, direction, consent, waiver or other instrument or action by an Owner
shall bind the successors and assigns of such Owner.
SECTION 11.08.
Covenants of the Depositor. In the event that (a) the Certificate Balance
shall be reduced by Realized Losses and (b) any litigation with claims in
excess of $1,000,000 to which the Depositor is a party which shall be
reasonably likely to result in a material judgment against the Depositor that
the Depositor will not be able to satisfy shall be commenced, during the
period beginning immediately following the commencement of such litigation
and continuing until such litigation is dismissed or otherwise terminated
(and, if such litigation has resulted in a final judgment against the
Depositor, such judgment has been satisfied), the Depositor shall not pay any
dividend to First Merchants Acceptance Corporation, or make any distribution
on or in respect of its capital stock to First Merchants Acceptance
Corporation, or repay the principal amount of any indebtedness of the
Depositor held by First Merchants Acceptance Corporation, unless (i) after
giving effect to such payment, distribution or repayment, the Depositor's
liquid assets shall not be less than the amount of actual damages claimed in
such litigation or (ii) the Rating Agency Condition shall have been satisfied
with respect to any such payment, distribution or repayment. The Depositor
will not at any time institute against the Trust any bankruptcy proceedings
under any United States federal or state bankruptcy or similar law in
connection with any obligations relating to the Trust Certificates, the
Notes, the Trust Agreement or any of the Basic Documents.
SECTION 11.09.
No Petition. The Owner Trustee, by entering into this Agreement, each
Certificateholder, by accepting a Trust Certificate, and the Indenture
Trustee and each Noteholder, by accepting the benefits of this Agreement,
hereby covenant and agree that they will not at any time institute against
the Depositor or the Trust, or join in any institution against the Depositor
or the Trust of, any bankruptcy proceedings under any United States federal
or state bankruptcy or similar law in connection with any obligations
relating to the Trust Certificates, the Notes, this Agreement or any of the
Basic Documents.
SECTION 11.10.
No Recourse. Each Certificateholder by accepting a Trust Certificate
acknowledges that such Trust Certificate represents a beneficial interest in
the Trust only and does not represent an interest in or an obligation of the
Depositor, the Servicer, the Administrator, the Owner Trustee, the Indenture
Trustee, the Backup Servicer or any Affiliate thereof and no recourse may be
had against such parties or their assets, except as may be expressly set
forth or contemplated in this Agreement, the Trust Certificates or the Basic
Documents.
SECTION 11.11.
Headings. The headings of the various Articles and Sections herein are for
convenience of reference only and shall not define or limit any of the terms
or provisions hereof.
SECTION 11.12.
GOVERNING LAW. THIS AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH THE
LAWS OF THE STATE OF DELAWARE, WITHOUT REFERENCE TO ITS CONFLICT OF LAW
PROVISIONS, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER
SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
SECTION 11.13.
Trust Certificate Transfer Restrictions. The Trust Certificates may not be
acquired by or for the account of (i) an employee benefit plan (as defined in
Section 3(3) of ERISA) that is subject to the provisions of Title I of ERISA,
(ii) a plan described in Section 4975(e)(1) of the Code or (iii) any entity
whose underlying assets include plan assets by reason of a plan's investment
in the entity (each, a "Benefit Plan"). By accepting and holding a Trust
Certificate, the Holder thereof shall be deemed to have represented and
warranted that it is not a Benefit Plan. IN WITNESS WHEREOF, the parties
hereto have caused this Amended and Restated Trust Agreement to be duly executed
by their respective officers hereunto duly authorized, as of the day and year
first above written.
FIRST MERCHANTS AUTO RECEIVABLES CORPORATION II, as Depositor
by:
Name:
Title:
CHASE MANHATTAN BANK DELAWARE,
not in its individual capacity but solely as Owner Trustee
by:
Name:
Title:
EXHIBIT A
FORM OF TRUST CERTIFICATE
THIS TRUST CERTIFICATE IS SUBORDINATE TO THE NOTES, AS SET FORTH IN THE SALE
AND SERVICING AGREEMENT.
THIS TRUST CERTIFICATE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "1933 ACT"), OR UNDER THE SECURITIES
OR BLUE SKY LAWS OF ANY STATE IN THE UNITED STATES OR ANY FOREIGN SECURITIES
LAWS. BY ITS ACCEPTANCE OF THIS TRUST CERTIFICATE THE HOLDER HEREOF UNLESS
SUCH HOLDER IS THE DEPOSITOR OR AN AFFILIATE THEREOF IS DEEMED TO REPRESENT
TO THE DEPOSITOR AND THE OWNER TRUSTEE (i) THAT IT IS AN "ACCREDITED
INVESTOR" AS DEFINED IN RULE 501(a)(1), (2), (3) OR (7) OF REGULATION D
PROMULGATED UNDER THE 1933 ACT (AN "ACCREDITED INVESTOR") AND THAT IT IS
ACQUIRING THIS TRUST CERTIFICATE FOR ITS OWN ACCOUNT (AND NOT FOR THE ACCOUNT
OF OTHERS) OR AS A FIDUCIARY OR AGENT FOR OTHERS (WHICH OTHERS ALSO ARE
ACCREDITED INVESTORS UNLESS THE HOLDER IS A BANK ACTING IN ITS FIDUCIARY
CAPACITY) FOR INVESTMENT AND NOT WITH A VIEW TO, OR FOR OFFER OR SALE IN
CONNECTION WITH, THE PUBLIC DISTRIBUTION HEREOF OR (ii) THAT IT IS A
"QUALIFIED INSTITUTIONAL BUYER" AS DEFINED IN RULE 144A UNDER THE 1933 ACT
AND IS ACQUIRING SUCH TRUST 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 TRUST CERTIFICATE MAY BE MADE BY
ANY PERSON UNLESS EITHER (i) SUCH SALE, PLEDGE OR OTHER TRANSFER IS MADE TO
THE DEPOSITOR, (ii) SUCH SALE, PLEDGE OR OTHER TRANSFER IS MADE TO AN
ACCREDITED INVESTOR THAT EXECUTES A CERTIFICATE, SUBSTANTIALLY IN THE FORM
SPECIFIED IN THE TRUST AGREEMENT, TO THE EFFECT THAT IT IS AN ACCREDITED
INVESTOR ACTING FOR ITS OWN ACCOUNT (AND NOT FOR THE ACCOUNT OF OTHERS) OR AS
A FIDUCIARY OR AGENT FOR OTHERS (WHICH OTHERS ALSO ARE ACCREDITED INVESTORS
UNLESS THE HOLDER IS A BANK ACTING IN ITS FIDUCIARY CAPACITY), (iii) SO LONG
AS THIS TRUST CERTIFICATE IS ELIGIBLE FOR RESALE PURSUANT TO RULE 144A UNDER
THE 1933 ACT, SUCH SALE, PLEDGE OR OTHER TRANSFER IS MADE TO A PERSON WHOM
THE PROSPECTIVE 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 (iv) SUCH SALE, PLEDGE OR OTHER TRANSFER IS OTHERWISE MADE IN A
TRANSACTION EXEMPT FROM THE REGISTRATION REQUIREMENTS OF THE 1933 ACT, IN
WHICH CASE (A) THE OWNER TRUSTEE SHALL REQUIRE THAT BOTH THE PROSPECTIVE
TRANSFEROR AND THE PROSPECTIVE TRANSFEREE CERTIFY TO THE OWNER TRUSTEE AND
THE DEPOSITOR IN WRITING THE FACTS SURROUNDING SUCH TRANSFER, WHICH
CERTIFICATION SHALL BE IN FORM AND SUBSTANCE SATISFACTORY TO THE OWNER
TRUSTEE AND THE DEPOSITOR, AND (B) THE OWNER TRUSTEE SHALL REQUIRE A WRITTEN
OPINION OF COUNSEL (WHICH SHALL NOT BE AT THE EXPENSE OF THE DEPOSITOR, ANY
AFFILIATE OF THE DEPOSITOR OR THE OWNER TRUSTEE) SATISFACTORY TO THE
DEPOSITOR AND THE OWNER TRUSTEE TO THE EFFECT THAT SUCH TRANSFER WILL NOT
VIOLATE THE 1933 ACT. NO SALE, PLEDGE OR OTHER TRANSFER MAY BE MADE TO ANY
ONE PERSON FOR SECURITIES WITH A FACE AMOUNT OF LESS THAN $100,000 AND, IN
THE CASE OF ANY PERSON ACTING ON BEHALF OF ONE OR MORE THIRD PARTIES (OTHER
THAN A BANK (AS DEFINED IN SECTION 3(a)(2) OF THE 1933 ACT) ACTING IN ITS
FIDUCIARY CAPACITY), FOR SECURITIES WITH A FACE AMOUNT OF LESS THAN $100,000
FOR EACH SUCH THIRD PARTY."
EACH SECURITYHOLDER, BY ITS ACCEPTANCE OF THIS SECURITY, COVENANTS AND AGREES
THAT SUCH SECURITYHOLDER, SHALL NOT, PRIOR TO THE DATE THAT IS ONE YEAR AND
ONE DAY AFTER THE TERMINATION OF THE TRUST AGREEMENT, ACQUIESCE, PETITION OR
OTHERWISE INVOKE OR CAUSE THE TRUST OR THE DEPOSITOR TO INVOKE THE PROCESS OF
ANY COURT OR GOVERNMENTAL AUTHORITY FOR THE PURPOSE OF COMMENCING OR
SUSTAINING A CASE AGAINST THE TRUST OR THE DEPOSITOR UNDER ANY FEDERAL OR
STATE BANKRUPTCY, INSOLVENCY, REORGANIZATION OR SIMILAR LAW, OR APPOINTING A
RECEIVER, LIQUIDATOR, ASSIGNEE, TRUSTEE, CUSTODIAN, SEQUESTRATOR OR OTHER
SIMILAR OFFICIAL OF THE TRUST OR THE DEPOSITOR OR ANY SUBSTANTIAL PART OF ITS
PROPERTY, OR ORDERING THE WINDING UP OR LIQUIDATION OF THE AFFAIRS OF THE
TRUST OR THE DEPOSITOR.
NO TRANSFER OF A TRUST CERTIFICATE SHALL BE MADE TO ANY PERSON UNLESS THE
OWNER TRUSTEE HAS RECEIVED (A) A CERTIFICATE IN THE FORM OF PARAGRAPH 3 TO
THE INVESTMENT LETTER ATTACHED TO THE TRUST AGREEMENT AS EXHIBIT D FROM SUCH
PERSON TO THE EFFECT THAT SUCH PERSON IS NOT (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 DESCRIBED IN SECTION 4975(E)(1) OF THE CODE OR (III) ANY
ENTITY WHOSE UNDERLYING ASSETS INCLUDE PLAN ASSETS BY REASON OF A PLAN'S
INVESTMENT IN THE ENTITY (EACH, A "BENEFIT PLAN"), (B) AN OPINION OF COUNSEL
SATISFACTORY TO THE OWNER TRUSTEE AND THE DEPOSITOR TO THE EFFECT THAT THE
PURCHASE AND HOLDING OF SUCH TRUST CERTIFICATE WILL NOT CONSTITUTE OR RESULT
IN THE ASSETS OF THE TRUST BEING DEEMED TO BE "PLAN ASSETS" SUBJECT TO THE
PROHIBITED TRANSACTIONS PROVISIONS OF ERISA OR SECTION 4975 OF THE CODE AND
WILL NOT SUBJECT THE OWNER TRUSTEE, THE INDENTURE TRUSTEE OR THE DEPOSITOR TO
ANY OBLIGATION IN ADDITION TO THOSE UNDERTAKEN IN THE BASIC DOCUMENTS OR (C)
IF SUCH PERSON IS AN INSURANCE COMPANY, A REPRESENTATION THAT SUCH PERSON IS
AN INSURANCE COMPANY THAT IS PURCHASING SUCH TRUST CERTIFICATES WITH FUNDS
CONTAINED IN AN "INSURANCE COMPANY GENERAL ACCOUNT" (AS SUCH TERM IS DEFINED
IN SECTION V(E) OF PROHIBITED TRANSACTION CLASS EXEMPTION 95-60 ("PTCE 95-
60")) AND THAT THE PURCHASE AND HOLDING OF SUCH TRUST CERTIFICATES AND ANY
DEEMED EXTENSION OF CREDIT FROM A CERTIFICATEHOLDER WHICH IS A PARTY IN
INTEREST TO A PLAN, THE ASSETS OF WHICH ARE HELD BY SUCH "INSURANCE COMPANY"
ARE COVERED UNDER PTCE 95-60.
NO TRANSFER OF A TRUST CERTIFICATE SHALL BE MADE TO ANY PERSON UNLESS THE
OWNER TRUSTEE HAS RECEIVED AN OPINION OF COUNSEL SATISFACTORY TO THE OWNER
TRUSTEE AND THE DEPOSITOR TO THE EFFECT THAT SUCH TRANSFER WILL NOT CAUSE THE
TRUST TO BE TREATED AS AN ASSOCIATION OR PUBLICLY TRADED PARTNERSHIP TAXABLE
AS A CORPORATION FOR FEDERAL OR ILLINOIS INCOME TAX PURPOSES AND THAT SUCH
TRANSFER WILL NOT RESULT IN ANY MATERIALLY ADVERSE FEDERAL INCOME TAX
CONSEQUENCES TO NOTEHOLDERS.
NUMBER$_________R-
FIRST MERCHANTS AUTO TRUST 1997-1
6.75% ASSET BACKED CERTIFICATE
evidencing a fractional undivided interest in the Trust, as defined
below, the property of which consists of
(a) the Receivables and all moneys received thereon on or after the Cutoff
Date; (b) the security interests in the Financed Vehicles and any accessions
thereto granted by Obligors pursuant to the Receivables and any other
interest of the Depositor in such Financed Vehicles; (c) any Liquidation
Proceeds and any other proceeds with respect to the Receivables from claims
on any physical damage, credit life or disability insurance policies covering
Financed Vehicles or Obligors, including any vendor's single interest or
other collateral protection insurance policy; (d) any property that shall
have secured a Receivable and shall have been acquired by or on behalf of the
Depositor, the Servicer or the Trust; (e) all documents and other items
contained in the Receivables Files; (f) all of the Depositor's rights (but
not its obligations) under the Receivables Purchase Agreement; (g) all right,
title and interest in all funds on deposit from time to time in the Trust
Accounts and the Certificate Distribution Account, and in all investments and
proceeds thereof (including all income thereon); and (h) the proceeds of any
and all of the foregoing.
THIS TRUST CERTIFICATE DOES NOT REPRESENT AN INTEREST IN OR AN OBLIGATION OF
FIRST MERCHANTS AUTO RECEIVABLES CORPORATION II, FIRST MERCHANTS ACCEPTANCE
CORPORATION OR ANY OF THEIR RESPECTIVE AFFILIATES.
THIS CERTIFIES THAT ________________ is the registered owner of
____________________________________________ DOLLARS nonassessable, fully
paid, fractional undivided interest in FIRST MERCHANTS AUTO TRUST 1997-1 (the
"Trust"), formed by FIRST MERCHANTS AUTO RECEIVABLES CORPORATION II, a
Delaware corporation (the "Depositor").
The Trust was created pursuant to a Trust Agreement dated as of March
10, 1997, as amended and restated by an Amended and Restated Trust Agreement
dated as of March 1, 1997 (as so amended and restated and further amended or
supplemented from time to time, the "Trust Agreement"), between the Depositor
and Chase Manhattan Bank Delaware, as owner trustee (the "Owner Trustee"), a
summary of certain of the pertinent provisions of which is set forth below.
To the extent not otherwise defined herein, the capitalized terms used herein
have the meanings assigned to them in the Trust Agreement or the Sale and
Servicing Agreement dated as of March 1, 1997 (as amended and supplemented
from time to time, the "Sale and Servicing Agreement"), among the Trust, the
Depositor, as seller, First Merchants Acceptance Corporation, as servicer
(the "Servicer"), and Xxxxxx Trust and Savings Bank, as indenture trustee and
backup servicer (in such capacities, the "Indenture Trustee" and "Backup
Servicer"), as applicable.
This Trust Certificate is one of the duly authorized Trust Certificates
designated as "6.75% Asset Backed Certificates" (herein called the "Trust
Certificates"). Also issued under an Indenture dated as of March 1, 1997
(the "Indenture"), between the Trust and Xxxxxx Trust and Savings Bank, as
indenture trustee, are the two classes of Notes designated as "Floating Rate
Asset Backed Notes, Class A-1" and 6.75% Asset Backed Notes, Class A-2"
(collectively, the "Notes"). This Trust Certificate is issued under and is
subject to the terms, provisions and conditions of the Trust Agreement, to
which Trust Agreement the Holder of this Trust Certificate by virtue of its
acceptance hereof assents and by which such Certificateholder is bound. The
property of the Trust consists of a pool of retail installment contracts for
new and used automobiles, vans, minivans and light duty trucks (the
"Receivables") and all monies received thereon on or after March 1, 1997,
security interests in the vehicles financed thereby, certain bank accounts
and the proceeds thereof, proceeds from claims on certain insurance policies
and certain other rights under the Trust Agreement and the Sale and Servicing
Agreement and all proceeds of the foregoing. The rights of the
Certificateholders are subordinate to the rights of the Noteholders, as set
forth in the Sale and Servicing Agreement.
Under the Trust Agreement and Sale and Servicing Agreement, there will
be distributed on the 15th day of each month or, if such 15th day is not a
Business Day, the next Business Day (each, a "Distribution Date"), commencing
on April 15, 1997, to the Person in whose name this Trust Certificate is
registered at the close of business on the last day of the immediately
preceding month (the "Record Date"), such Certificateholder's fractional
undivided interest in the amount to be distributed to Certificateholders on
such Distribution Date. No distributions of principal will be made on any
Trust Certificate until all of the Notes have been paid in full.
The Holder of this Trust Certificate acknowledges and agrees that its
rights to receive distributions in respect of this Trust Certificate are
subordinate to the rights of the Noteholders as described in the Sale and
Servicing Agreement and the Indenture.
It is the intent of the Depositor, the Servicer and the
Certificateholders that, for purposes of federal income, state and local
income and single business tax and any other income taxes, in the event the
Trust Certificates are held by more than one Owner, the Trust will be treated
as a partnership and the Certificateholders (including the Depositor) will be
treated as partners in that partnership. The Depositor and the other
Certificateholders, by acceptance of a Trust Certificate, shall be deemed to
have agreed to the above treatment and to taking no action inconsistent
therewith.
Each Certificateholder, by its acceptance of a Trust Certificate,
covenants and agrees that such Certificateholder will not at any time
institute against the Depositor or the Trust, or join in any institution
against the Depositor or the Trust of, any bankruptcy, reorganization,
arrangement, insolvency or liquidation proceedings, or other proceedings
under any United States federal or state bankruptcy or similar law in
connection with any obligations relating to the Trust Certificates, the
Notes, the Trust Agreement or any of the Basic Documents.
Distributions on this Trust Certificate will be made as provided in the
Trust Agreement by the Owner Trustee by wire transfer or check mailed to the
Certificateholder of record in the Certificate Register without the
presentation or surrender of this Trust Certificate or the making of any
notation hereon. Except as otherwise provided in the Trust Agreement and
notwithstanding the above, the final distribution on this Trust Certificate
will be made after due notice by the Owner Trustee of the pendency of such
distribution and only upon presentation and surrender of this Trust
Certificate at the office or agency maintained for that purpose by the Owner
Trustee in the Borough of Manhattan, The City of New York.
Reference is hereby made to the further provisions of this Trust
Certificate set forth on the reverse hereof, which further provisions shall for
all purposes have the same effect as if set forth at this place.
Unless the certificate of authentication hereon shall have been
executed by an authorized officer of the Owner Trustee, by manual signature,
this Trust Certificate shall not entitle the Holder hereof to any benefit under
the Trust Agreement or the Sale and Servicing Agreement or be valid for any
purpose.
THIS TRUST CERTIFICATE SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS
OF THE STATE OF DELAWARE, WITHOUT REFERENCE TO ITS CONFLICT OF LAW PROVISIONS,
AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE
DETERMINED IN ACCORDANCE WITH SUCH LAWS.
IN WITNESS WHEREOF, the Owner Trustee, on behalf of the Trust and not
in its individual capacity, has caused this Trust Certificate to be duly
executed.
FIRST MERCHANTS AUTO TRUST 1997-1
by:
CHASE MANHATTAN BANK DELAWARE, not in its individual capacity but solely as
Owner Trustee
Dated:
by:
Authorized Signatory
OWNER TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Trust Certificates referred to in the within-mentioned
Trust Agreement.
CHASE MANHATTAN BANK DELAWARE,
CHASE MANHATTAN BANK DELAWARE,
as Owner Trustee or as Owner Trustee
by: THE CHASE MANHATTAN BANK,
as
Authenticating Agent
by:
Authorized Signatory
by:
Authorized Signatory
[REVERSE OF TRUST CERTIFICATE]
The Trust Certificates do not represent an obligation of, or an
interest in, the Depositor, the Servicer, the Owner Trustee or any affiliates
of any of them and no recourse may be had against such parties or their
assets, except as expressly set forth or contemplated herein or in the Trust
Agreement or the Basic Documents. In addition, this Trust Certificate is not
guaranteed by any governmental agency or instrumentality and is limited in
right of payment to certain collections and recoveries with respect to the
Receivables (and certain other amounts), 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 by any
Certificateholder upon written request during normal business hours at the
principal office of the Depositor and at such other places, if any,
designated by the Depositor.
The Trust Agreement permits, with certain exceptions therein provided,
the amendment thereof and the modification of the rights and obligations of
the Depositor and the rights of the Certificateholders under the Trust
Agreement at any time by the Depositor and the Owner Trustee with the consent
of the Holders of the Trust Certificates and the Notes, each voting as a
class, evidencing not less than a majority of the Certificate Balance and the
outstanding principal balance of the Notes of each class. Any such consent
by the Holder of this Trust Certificate shall be conclusive and binding on
such Holder and on all future Holders of this Trust Certificate and of any
Trust Certificate issued upon the transfer hereof or in exchange herefor or
in lieu hereof, whether or not notation of such consent is made upon this
Trust Certificate. The Trust Agreement also permits the amendment thereof,
in certain limited circumstances, without the consent of the Holders of any
of the Trust Certificates.
As provided in the Trust Agreement and subject to certain
limitations therein set forth, the transfer of this Trust Certificate is
registerable in the Certificate Register upon surrender of this Trust
Certificate for registration of transfer at the offices or agencies of the
Certificate Registrar maintained by the Owner Trustee in the Borough of
Manhattan, The City of New York, accompanied by a written instrument of
transfer in form satisfactory to the Owner Trustee and the Certificate
Registrar duly executed by the Certificateholder hereof or such
Certificateholder's attorney duly authorized in writing, and thereupon one or
more new Trust Certificates of authorized denominations evidencing the same
aggregate interest in the Trust will be issued to the designated transferee.
The initial Certificate Registrar appointed under the Trust Agreement is The
Chase Manhattan Bank, New York, New York.
The initial Holder of the Trust Certificates shall be the
Depositor. In the event that the Depositor transfers any Trust Certificate
to any other Person, the Depositor, by its transfer, and such Person, by its
acceptance of the Trust Certificate so transferred, shall be deemed to have
agreed to treat the Trust as a partnership with the Trust Certificates
representing partnership interests therein and the Notes representing debt
thereof. Any transfer by such transferee shall be subject to the same
condition.
Except as provided in the Trust Agreement, the Trust Certificates
are issuable only as registered Trust Certificates without coupons in
denominations of $20,000 and in integral multiples of $1,000 in excess
thereof provided, however, that the Trust Certificates issued to the
Depositor may be issued in such denomination as is required to include any
residual amount. As provided in the Trust Agreement and subject to certain
limitations therein set forth, Trust Certificates are exchangeable for new
Trust Certificates of authorized denominations evidencing the same aggregate
denomination, as requested by the Certificateholder surrendering the same.
No service charge will be made for any such registration of transfer or
exchange, but the Owner Trustee or the Certificate Registrar may require
payment of a sum sufficient to cover any tax or governmental charge payable
in connection therewith.
The Owner Trustee, the Certificate Registrar and any agent of the
Owner Trustee or the Certificate Registrar may treat the Person in whose name
this Trust Certificate is registered as the owner hereof for all purposes,
and none of the Owner Trustee, the Certificate Registrar or any such agent
shall be affected by any notice to the contrary.
The obligations and responsibilities created by the Trust
Agreement and the Trust created thereby shall terminate upon the payment to
Certificateholders of all amounts required to be paid to them pursuant to the
Trust Agreement and the Sale and Servicing Agreement and the disposition of
all property held as part of the Owner Trust Estate. The Servicer of the
Receivables may at its option purchase the Owner Trust Estate at a price
specified in the Sale and Servicing Agreement, and such purchase of the
Receivables and other property of the Trust will effect early retirement of
the Trust Certificates; provided, however, such right of purchase is
exercisable only as of the last day of any Collection Period as of which the
Pool Balance is less than or equal to 10% of the Original Pool Balance.
The Trust Certificates may not be acquired by (a) an employee
benefit plan (as defined in Section 3(3) of ERISA) that is subject to the
provisions of Title I of ERISA, (b) a plan described in Section 4975(e)(1) of
the Code or (c) any entity whose underlying assets include plan assets by
reason of a plan's investment in the entity or which uses plan assets to
acquire Trust Certificates (each, a "Benefit Plan"). By accepting and
holding this Trust Certificate, the Holder hereof shall be deemed to have
represented and warranted that it is not a Benefit Plan.
ASSIGNMENT
FOR VALUE RECEIVED the undersigned hereby sells, assigns and
transfers unto
PLEASE INSERT SOCIAL SECURITY OR
OTHER IDENTIFYING NUMBER OF ASSIGNEE
(Please print or type name and address, including postal zip code, of
assignee)
the within Trust Certificate, and all rights thereunder, and hereby
irrevocably constitutes and appoints , attorney,
to transfer said Trust Certificate on the books of the Certificate Registrar,
with full power of substitution in the premises.
Dated:
___________________________________________*/
Signature Guaranteed:
____________________________*/
_________________
*/ NOTICE: The signature to this assignment must correspond with the
name of the registered owner as it appears on the face of the within
Trust Certificate in every particular, without alteration, enlargement
or any change whatever. Such signature must be guaranteed by an
"eligible guarantor institution" meeting the requirements of the
Certificate Registrar, which requirements include membership or
participation in STAMP or such other "signature guarantee program" as
may be determined by the Certificate Registrar in addition to, or in
substitution for, STAMP, all in accordance with the Securities
Exchange Act of 1934, as amended.
EXHIBIT B
Form of Certificate of Trust of First Merchants Auto Trust 1997-1
THIS Certificate of Trust of FIRST MERCHANTS AUTO TRUST 1997-1
(the "Trust"), dated [ ], 1997, is being duly executed and filed by Chase
Manhattan Bank Delaware, a Delaware banking corporation, as trustee, to form
a business trust under the Delaware Business Trust Act (12 Del. Code, & 3801
et seq.).
1. Name. The name of the business trust formed hereby is FIRST
MERCHANTS AUTO TRUST 1997-1.
2. Delaware Trustee. The name and business address of the
trustee of the Trust in the State of Delaware is Chase Manhattan
Bank Delaware, 0000 Xxxxxx Xxxxxx, Xxxxxxxxxx, Xxxxxxxx 00000,
Attention: Corporate Trustee Administration Department.
IN WITNESS WHEREOF, the undersigned, being the sole trustee of
the Trust, has executed this Certificate of Trust as of the date first above
written.
CHASE MANHATTAN BANK DELAWARE,
not in its individual capacity
but solely as owner trustee under
a Trust Agreement dated as of
March [ ], 1997
By:
Name:
Title:
EXHIBIT C
FORM OF TRANSFEROR CERTIFICATE
[DATE]
First Merchants Auto Receivables
Corporation II
000 Xxxx Xxxx Xxxx
Xxxxx 000X
Xxxxxxxxx, XX 00000
Chase Manhattan Bank Delaware, as Owner Trustee
0000 Xxxxxx Xxxxxx
Xxxxxxxxxx, XX 00000
Re:First Merchants Auto Trust 1997-1
6.75% Asset Backed Certificates
Ladies and Gentlemen:
In connection with our disposition of the above-referenced 6.75% Asset
Backed Certificates (the "Certificates") we certify that (a) we understand
that the Certificates have not been registered under the Securities Act of
1933, as amended (the "Act"), and are being transferred by us in a
transaction that is exempt from the registration requirements of the Act and
(b) we have not offered or sold any Certificates to, or solicited offers to
buy any Certificates from, any person, or otherwise approached or negotiated
with any person with respect thereto, in a manner that would be deemed, or
taken any other action which would result in, a violation of Section 5 of the
Act.
Very truly yours,
[NAME OF TRANSFEROR]
By:
Authorized Officer
EXHIBIT D
FORM OF INVESTMENT LETTER
First Merchants Auto Receivables
Corporation II, as Depositor
000 Xxxx Xxxx Xxxx
Xxxxx 000X
Xxxxxxxxx, XX 00000
Chase Manhattan Bank Delaware, as Owner Trustee
0000 Xxxxxx Xxxxxx
Xxxxxxxxxx, XX 00000
Ladies and Gentlemen:
In connection with our proposed purchase of $
aggregate principal amount of 6.75% Asset Backed Certificates (the
"Certificates") of First Merchants Auto Trust 1997-1 (the "Issuer"), we
confirm that:
1.We understand that the Certificates have not been
registered under the Securities Act of 1933, as amended (the "1933
Act"), and may not be sold except as permitted in the following
sentence. We understand and agree, on our own behalf and on behalf of
any accounts for which we are acting as hereinafter stated, (x) that
such Certificates are being offered only in a transaction not
involving any public offering within the meaning of the 1933 Act and
(y) that such Certificates may be resold, pledged or transferred only
(i) to the Depositor, (ii) to an "accredited investor" as defined in
Rule 501(a)(1),(2),(3) or (7) (an "Accredited Investor") under the
1933 Act acting for its own account (and not for the account of
others) or as a fiduciary or agent for others (which others also are
Accredited Investors unless the holder is a bank acting in its
fiduciary capacity) that executes a certificate substantially in the
form hereof, (iii) so long as such Certificate is eligible for resale
pursuant to Rule 144A under the 1933 Act ("Rule 144A"), to a person
whom we reasonably believe 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 resale, pledge or transfer is being made
in reliance on Rule 144A or (iv) in a sale, pledge or other transfer
made in a transaction otherwise exempt from the registration
requirements of the 1933 Act, in which case the Owner Trustee shall
require that both the prospective transferor and the prospective
transferee certify to the Owner Trustee and the Depositor in writing
the facts surrounding such transfer, which certification shall be in
form and substance satisfactory to the Owner Trustee and the
Depositor. Except in the case of a transfer described in clauses (i)
or (iii) above, the Owner Trustee shall require a written opinion of
counsel (which will not be at the expense of the Depositor, any
affiliate of the Depositor or the Owner Trustee) satisfactory to the
Depositor and the Owner Trustee be delivered to the Depositor and the
Owner Trustee to the effect that such transfer will not violate the
1933 Act, in each case in accordance with any applicable securities
laws of any state of the United States. We will notify any purchaser
of the Certificates from us of the above resale restrictions, if then
applicable. We further understand that in connection with any
transfer of the Certificates by us that the Depositor and the Owner
Trustee may request, and if so requested we will furnish such
certificates and other information as they may reasonably require to
confirm that any such transfer complies with the foregoing
restrictions. We understand that no sale, pledge or other transfer
may be made to any one person of Certificates with a face amount of
less than $100,000 and, in the case of any person acting on behalf of
one or more third parties (other than a bank (as defined in Section
3(a)((2) of the 0000 Xxx) acting in its fiduciary capacity), of
Certificates with a face amount of less than $100,000 for each such
third party.
2. [CHECK ONE]
(a) We are an "accredited investor" (as defined in Rule
501(a)(1),(2),(3) or (7) of Regulation D under the 0000 Xxx)
acting for our own account (and not for the account of others)
or as a fiduciary or agent for others (which others also are
Accredited Investors unless we are a bank acting in its
fiduciary capacity). We have such knowledge and experience in
financial and business matters as to be capable of evaluating
the merits and risks of our investment in the Certificates, and
we and any accounts for which we are acting are each able to
bear the economic risk of our or their investment for an
indefinite period of time. We are acquiring the Certificates
for investment and not with a view to, or for offer and sale in
connection with, a public distribution.
(b) We are a "qualified institutional buyer" as defined under
Rule 144A under the 1933 Act and are acquiring the Certificates
for our own account (and not for the account of others) or as a
fiduciary or agent for others (which others also are "qualified
institutional buyers"). We are familiar with Rule 144A under
the 1933 Act and are aware that the seller of the Certificates
and other parties intend to rely on the statements made herein
and the exemption from the registration requirements of the 1933
Act provided by Rule 144A.
3.We are not (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 described in Section 4975(e)(1) of the Code or
(iii) any entity whose underlying assets include plan assets by reason
of a plan's investment in the entity (each, a "Benefit Plan"). We
hereby acknowledge that no transfer of any Certificate shall be
permitted to be made to any person unless the Owner Trustee has
received (i) a certificate from such transferee to the effect of the
preceding sentence, (ii) an opinion of counsel satisfactory to the
Owner Trustee to the effect that the purchase and holding of any such
Certificate will not constitute or result in the assets of the Issuer
being deemed to be "plan assets" and subject to the prohibited
transaction provisions of ERISA or Section 4975 of the Code and will
not subject the Owner Trustee, Xxxxxx Trust and Savings Bank, as
Indenture Trustee or the Depositor to any obligation in addition to
those undertaken in the Basic Documents with respect to the
Certificates (provided, however, that the Owner Trustee will not
require such certificate or opinion in the event that, as a result of
change of law or otherwise, counsel satisfactory to the Owner Trustee
has rendered an opinion to the effect that the purchase and holding of
any such Certificate by a Benefit Plan or a Person that is purchasing
or holding any such Certificate with the assets of a Benefit Plan will
not constitute or result in a prohibited transaction under ERISA or
Section 4975 of the Code) or (iii) if the transferee is an insurance
company, a representation that the transferee is an insurance company
that is purchasing such certificates with funds contained in an
"Insurance Company General Account" (as such term is defined in
Section V(e) of Prohibited Transaction Class Exemption 95-60 ("PTCE
95-60")) and that the purchase and holding of such Certificates and
any deemed extension of credit from a Certificateholder which is a
party in interest to a Plan, the assets of which are held by such
"Insurance Company" are covered under PTCE 95-60.
4.We understand that the Depositor, the Owner Trustee, the
Issuer, Salomon Brothers Inc ("Salomon Brothers") and others will rely
upon the truth and accuracy of the foregoing acknowledgments,
representations and agreements, and we agree that if any of the
acknowledgments, representations and warranties deemed to have been
made by us by our purchase of the Certificates, for our own account or
for one or more accounts as to each of which we exercise sole
investment discretion, are no longer accurate, we shall promptly
notify the Depositor the Owner Trustee and Salomon Brothers.
0.Xxx are entitled to rely upon this letter and you are
irrevocably authorized to produce this letter or a copy hereof to any
interested party in any administrative or legal proceeding or official
inquiry with respect to the matters covered hereby.
Very truly yours,
[NAME OF PURCHASER]
By:_________________________________
Name:
Title:
Date:________________________________
