Execution Copy
================================================================================
CHASE MANHATTAN AUTO OWNER TRUST 1996-C
TRUST AGREEMENT
among
CHASE MANHATTAN BANK USA, N.A.,
as Depositor
CHASE AUTO FUNDING CORPORATION,
as General Partner
and
WILMINGTON TRUST COMPANY,
as Owner Trustee
Dated as of December 1, 1996
================================================================================
TABLE OF CONTENTS
Page
----
ARTICLE I
DEFINITIONS
SECTION 1.1. Capitalized Terms............................ 1
ARTICLE II
ORGANIZATION
SECTION 2.1 Name......................................... 2
SECTION 2.2 Office....................................... 2
SECTION 2.3 Purposes and Powers.......................... 2
SECTION 2.4 Appointment of Owner Trustee................. 3
SECTION 2.5 Initial Capital Contribution of
Trust Estate............................... 3
SECTION 2.6 Declaration of Trust......................... 3
SECTION 2.7 Title to Issuer Property..................... 3
SECTION 2.8 Situs of Issuer.............................. 4
SECTION 2.9 Representations and Warranties of
the Depositor and General Partner.......... 4
SECTION 2.10 Liability of Owners.......................... 5
SECTION 2.11. Guaranteed Payments/Gross Income
Allocations................................ 6
SECTION 2.12. Deduction and Loss Allocations............... 7
SECTION 2.13. Special Allocations.......................... 7
SECTION 2.14. Amended and Restated Trust Agreement......... 7
SECTION 2.15. Required Net Worth of General Partner........ 7
ARTICLE III
CERTIFICATES AND TRANSFER OF INTERESTS
SECTION 3.1 Initial Ownership............................ 8
SECTION 3.2 The Certificates............................. 8
SECTION 3.3 Execution, Authentication and
Delivery of Certificates................... 8
SECTION 3.4 Registration of Transfer and
Exchange of Certificates................... 9
SECTION 3.5 Mutilated, Destroyed, Lost or Stolen
Certificates............................... 10
SECTION 3.6 Persons Deemed Certificateholders............ 11
SECTION 3.7 Access to List of
Certificateholders' Names and Addresses.... 11
SECTION 3.8 Maintenance of Office or Agency.............. 11
SECTION 3.9 Appointment of Paying Agent.................. 12
SECTION 3.10 Book-Entry Certificates...................... 12
SECTION 3.11 Notices to Clearing Agency................... 13
SECTION 3.12 Definitive Certificates...................... 14
SECTION 3.13 Authenticating Agent......................... 14
SECTION 3.14 Actions of Certificateholders................ 16
SECTION 3.15 Disposition of Certificates by General
Partner..................................... 17
ARTICLE IV
ACTIONS BY OWNER TRUSTEE
SECTION 4.1 Prior Notice to Certificateholders
with Respect to Certain Matters............ 17
SECTION 4.2 Action by Certificateholders with
Respect to Certain Matters................ 18
SECTION 4.3 Action by Certificateholders with
Respect to Bankruptcy..................... 18
SECTION 4.4 Restrictions on Certificateholders'
Power..................................... 18
SECTION 4.5 Majority Control............................. 18
ARTICLE V
APPLICATION OF TRUST FUNDS; CERTAIN DUTIES
SECTION 5.1 Establishment of Certificate
Distribution Account....................... 18
SECTION 5.2 Application of Funds in Certificate
Distribution Account....................... 19
SECTION 5.3 Method of Payment............................ 20
SECTION 5.4 No Segregation of Monies; No
Interest................................... 20
SECTION 5.5 Accounting and Reports to the Noteholders,
Certificateholders, the Internal
Revenue Service and Others................. 20
SECTION 5.6 Signature on Returns; Tax Matters
Partner.................................... 21
SECTION 5.7 Capital Accounts............................. 21
SECTION 5.8 Reserve Account.............................. 22
ARTICLE VI
AUTHORITY AND DUTIES OF OWNER TRUSTEE
SECTION 6.1 General Authority............................ 22
SECTION 6.2 General Duties............................... 22
SECTION 6.3 Action upon Instruction...................... 23
SECTION 6.4 No Duties Except as Specified in
this Agreement or in Instructions.......... 23
SECTION 6.5 No Action Except under Specified
Documents or Instructions.................. 24
SECTION 6.6 Restrictions................................. 24
SECTION 6.7 Doing Business in Other
Jurisdictions.............................. 24
ARTICLE VII
CONCERNING OWNER TRUSTEE
ii
SECTION 7.1 Acceptance of Trusts and Duties.............. 25
SECTION 7.2 Furnishing of Documents...................... 27
SECTION 7.3 Representations and Warranties............... 27
SECTION 7.4 Reliance; Advice of Counsel.................. 28
SECTION 7.5 Not Acting in Individual Capacity............ 29
SECTION 7.6 Owner Trustee May Own Certificates
and Notes.................................. 29
ARTICLE VIII
COMPENSATION OF OWNER TRUSTEE
SECTION 8.1 Owner Trustee's Fees and Expenses............ 29
SECTION 8.2 Indemnification.............................. 29
SECTION 8.3 Payments to Owner Trustee.................... 30
ARTICLE IX
TERMINATION OF TRUST AGREEMENT
SECTION 9.1 Termination of Trust Agreement............... 30
SECTION 9.2 Dissolution upon Bankruptcy of the
General Partner............................ 32
ARTICLE X
SUCCESSOR OWNER TRUSTEES AND ADDITIONAL OWNER TRUSTEES
SECTION 10.1 Eligibility Requirements for Owner
Trustee.................................... 32
SECTION 10.2 Resignation or Removal of Owner
Trustee.................................... 33
SECTION 10.3 Successor Owner Trustee...................... 33
SECTION 10.4 Merger or Consolidation of Owner
Trustee.................................... 34
SECTION 10.5 Appointment of Co-Trustee or
Separate Trustee........................... 34
ARTICLE XI
MISCELLANEOUS
SECTION 11.1 Supplements and Amendments................... 36
SECTION 11.2 No Legal Title to Owner Trust Estate
in Certificateholders...................... 37
SECTION 11.3 Limitations on Rights of Others.............. 37
SECTION 11.4 Notices...................................... 37
SECTION 11.5 Severability................................. 38
SECTION 11.6 Separate Counterparts........................ 38
SECTION 11.7 Successors and Assigns....................... 38
SECTION 11.8 No Petition.................................. 38
SECTION 11.9 No Recourse.................................. 39
SECTION 11.10 Headings..................................... 39
SECTION 11.11 GOVERNING LAW................................ 39
SECTION 11.12 Certificate Transfer Restrictions............ 39
iii
SECTION 11.13 Servicer Payment Obligation.................. 40
SECTION 11.14. Third Party Beneficiaries.................... 40
EXHIBITS
Exhibit A Form of Certificate
Exhibit B Form of Certificate of Trust
Exhibit C Form of Certificate Depository Agreement
iv
TRUST AGREEMENT dated as of December 1, 1996 among CHASE MANHATTAN BANK
USA, N.A. ("Chase USA"), a national banking association having its principal
executive offices located at ▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, as
the depositor (in its capacity as the depositor, the "Depositor"), CHASE AUTO
FUNDING CORPORATION, a Delaware corporation (the "General Partner"), and
Wilmington Trust Company, a Delaware banking corporation, as the owner trustee
(the "Owner Trustee").
ARTICLE I
DEFINITIONS
SECTION 1.1. Capitalized Terms. Capitalized terms are used in this
Agreement as defined in Section 1.1 to the Sale and Servicing Agreement between
the trust established by this Agreement and Chase USA, as Seller and Servicer,
dated as of December 1, 1996, as the same may be amended and supplemented from
time to time (the "Sale and Service Agreement").
(a) 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.
(b) 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.
(c) 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."
(d) The definitions contained in this Agreement are applicable to the
singular as well as the plural forms of such terms and to the masculine as well
as to the feminine and neuter genders of such terms.
(e) All calculations of the amount of interest accrued on
the Certificates shall be made on the basis of a 360-day year consisting of
twelve 30-day months.
ARTICLE II
ORGANIZATION
SECTION 2.1 Name. The trust created hereby shall be known as "Chase
Manhattan Auto Owner Trust 1996-C" (hereinafter, the "Issuer") in which name the
Owner Trustee may conduct the business of such trust, make and execute contracts
and other instruments on behalf of such trust and ▇▇▇ and be sued.
SECTION 2.2 Office. The office of the Issuer shall be in care of the Owner
Trustee at the Corporate Trust Office or at such other address as the Owner
Trustee may designate by written notice to the Certificateholders and the
Depositor.
SECTION 2.3 Purposes and Powers. The purpose of the Issuer is, and the
Issuer shall have the power and authority, to engage in the following
activities:
(a) to issue the Notes pursuant to the Indenture and the
Certificates pursuant to this Agreement, and to sell, transfer or exchange
the Notes and the Certificates;
(b) to acquire the property and assets set forth in the Sale and
Servicing Agreement from the Depositor pursuant to the terms thereof, to
make payments or distributions on the Notes and Certificates, to make
deposits to and withdrawals from the Reserve Account and other accounts
established under this Agreement and the Sale and Servicing Agreement;
(c) to assign, grant, transfer, pledge, mortgage and convey the
Trust Estate pursuant to the Indenture and to hold, manage and distribute
to the Certificateholders pursuant to the terms of the Sale and Servicing
Agreement any portion of the Trust Estate released from the Lien of, and
remitted to the Issuer pursuant to, the Indenture;
(d) to enter into and perform its obligations under the Basic
Documents to which it is a party;
(e) to engage in those activities, including entering into
agreements, that are necessary, suitable or convenient to accomplish the
foregoing or are incidental thereto or connected therewith; and
(f) subject to compliance with the Basic Documents, to engage in
such other activities as may be required in connection with conservation
of the Owner Trust Estate and the making of distributions to the
Certificateholders and the Noteholders.
2
Issuer is hereby authorized to engage in the foregoing activities. Issuer shall
not engage in any activity other than in connection with the foregoing or other
than as required or authorized by the terms of this Agreement or the other Basic
Documents.
SECTION 2.4 Appointment of Owner Trustee. The Depositor hereby appoints
the Owner Trustee as trustee of the Issuer effective as of the date hereof, to
have all the rights, powers and duties set forth herein.
SECTION 2.5 Initial Capital Contribution of Trust Estate. The Depositor
hereby sells, assigns, transfers, conveys and sets over to the Owner Trustee, as
of the date hereof, the sum of $14,804,541.85 (99% of the Reserve Account
Initial Deposit) and the General Partner hereby sells, assigns, transfers,
conveys and sets over to the Owner Trustee, as of the date hereof, the sum of $
149,540.83 (1% of the Reserve Account Initial Deposit). The Owner Trustee hereby
acknowledges receipt in trust from the Depositor and the General Partner, as of
the date hereof, of the foregoing contributions, which shall constitute the
initial Owner Trust Estate and shall be deposited in the Reserve Account
pursuant to Section 5.6(a) of the Sale and Servicing Agreement. The Depositor
shall pay the organizational expenses of the Issuer 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 2.6 Declaration of Trust. The Owner Trustee hereby declares that
it will hold the Owner Trust Estate in trust upon and subject to the conditions
set forth herein for the use and benefit of the Certificateholders, subject to
the obligations of the Issuer under the Basic Documents. It is the intention of
the parties hereto that the Issuer 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 United States income and franchise tax purposes, the Issuer
shall be treated as a partnership. The parties agree that, unless otherwise
required by appropriate tax authorities, the Issuer will file or cause to be
filed annual or other necessary returns, reports and other forms consistent with
the characterization of the Issuer as a partnership for such tax purposes.
Effective as of the date hereof, the Owner Trustee shall have all rights, powers
and duties set forth herein and to the extent not inconsistent herewith, in the
Business Trust Statute with respect to accomplishing the purposes of the Issuer.
The Owner Trustee shall file the Certificate of Trust with the Secretary of
State of Delaware.
SECTION 2.7 Title to Issuer Property. Legal title to all the Owner Trust
Estate shall be vested at all times in the Issuer 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 the
title shall be deemed to be vested in the Owner Trustee, a co-trustee and/or a
separate trustee, as the case may be.
3
SECTION 2.8 Situs of Issuer. The Issuer will be located and administered
in the State of Delaware. All bank accounts maintained by the Owner Trustee on
behalf of the Issuer shall be located in the State of Delaware or the State of
New York. Payments will be received by the Issuer only in Delaware or New York,
and payments will be made by the Issuer only from Delaware or New York. The only
office of the Issuer will be at its office in Delaware.
SECTION 2.9 Representations and Warranties of the Depositor and General
Partner.
(a) The Depositor hereby represents and warrants to the Owner Trustee that:
(i) The Depositor has been duly organized and is validly existing as
a national banking association in good standing under the laws of the
United States of America, with power and authority to own its properties
and to conduct its business as such properties are currently owned and
such business is presently conducted, and had at all relevant times, and
has, power, authority and legal right to acquire and own the Receivables.
(ii) The Depositor has the corporate power and authority to execute
and deliver this Agreement and to carry out its terms; the Depositor has
full power and authority to sell and assign the property to be sold and
assigned to and deposited with the Issuer, and the Depositor has duly
authorized such sale and assignment and deposit to the Issuer by all
necessary action; and the execution, delivery and performance of this
Agreement has been duly authorized by the Depositor by all necessary
action.
(iii) The consummation of the transactions contemplated by this
Agreement and the other Basic Documents 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 articles of association or bylaws of the Depositor, or
conflict with or breach any of the material terms or provisions of or
constitute (with or without notice or lapse of time) a default under 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; 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.
(b) The General Partner hereby represents and warrants to the Owner Trustee
that:
4
(i) The General Partner has been duly organized and is validly
existing as a corporation in good standing under the laws of Delaware,
with corporate power and authority to own its properties and to conduct
its business as such properties are currently owned and such business is
presently conducted.
(ii) The General Partner has the corporate power and authority to
execute and deliver this Agreement and to carry out its terms; and the
execution, delivery and performance of this Agreement has been duly
authorized by the General Partner by all necessary corporate action.
(iii) The consummation of the transactions contemplated by this
Agreement and the other Basic Documents, 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 General
Partner, or conflict with or breach any of the material terms or
provisions of or constitute (with or without notice or lapse of time) a
default under any indenture, agreement or other instrument to which the
General Partner 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; nor
violate any law or, to the best of the General Partner's knowledge, any
order, rule or regulation applicable to the General Partner of any court
or of any Federal or state regulatory body, administrative agency or other
governmental instrumentality having jurisdiction over the General Partner
or its properties.
SECTION 2.10 Liability of Owners. (a) The General Partner shall be liable
directly to and will indemnify the injured party for all losses, claims,
damages, liabilities and expenses of the Issuer (to the extent that, if all
amounts due on the Notes and Certificates were paid in full at the time such
liability becomes due, the remaining assets of the Issuer would be insufficient
to pay such amount) to the extent that the General Partner would be liable if
the Issuer were a partnership under the Delaware Revised Uniform Limited
Partnership Act in which the General Partner were a general partner; provided,
however, that the General Partner shall not be liable for any losses incurred by
a Certificateholder in the capacity of an investor in the Certificates or a
Noteholder in the capacity of an investor in the Notes. In addition, any third
party creditors of the Issuer (other than in connection with the obligations
described in the preceding proviso for which the General Partner shall not be
liable) shall be deemed third party beneficiaries of this paragraph. The
obligations of the General Partner under this paragraph shall be evidenced by
the Certificates described in Section 3.15, which for purposes of the Business
Trust Statute shall be deemed to be a separate class of Certificates from all
other Certificates issued by the Issuer; provided, however, that the rights and
obligations evidenced by all Certificates,
5
regardless of class, shall, except as provided in this Section, be identical.
(b) No Certificateholder, other than to the extent set forth in subsection
2.10(a), shall have any personal liability for any liability or obligation of
the Issuer.
SECTION 2.11. Guaranteed Payments/Gross Income Allocations. (a) Inasmuch
as the Certificateholders' Interest Distributable Amount is determined and paid
hereunder without regard to the income of the Issuer, the Issuer shall treat
payments of such amounts as "guaranteed payments" within the meaning of Section
707(c) of the Code. Consequently, Certificateholders will have ordinary income
equal to their allocable share of the Certificateholders' Interest Distributable
Amount, the Issuer will have an equivalent deduction for United States federal
income tax purposes and no amount of the gross income of the Issuer shall be
allocable to the Certificateholders (and there will be no corresponding increase
in a Certificateholders's Capital Account under Section 5.7). In the event that
any taxing authority does not respect such tax treatment, the gross income of
the Issuer for any calendar month as determined for United States federal income
tax purposes shall be allocated, after giving effect to special allocations set
forth in Section 2.12 of this Agreement and for purposes of maintaining Capital
Accounts under Section 5.7 of this Agreement as follows:
(1) first, among the Owners as of the close of the last day of such
calendar month, in proportion to their ownership of the principal amount
of Certificates on such date, an amount of gross income equal the amount
of interest that accrues in such calendar month on the Certificates in
accordance with their terms, including interest accruing thereon at the
Certificate Rate monthly and interest on amounts previously due under the
Certificates and not yet paid as provided therein; and
(2) the balance of gross income, if any, 99% thereof to the
Depositor and 1% thereof to the General Partner.
If the gross income of the Issuer for any month is insufficient for the
allocations described in clause (1) above, subsequent items of gross income
shall first be allocated to make up such shortfall before being allocated as
provided in clause (2).
(b) In the event the initial issue price of the Certificates differs from
their initial principal amount, there shall be specially allocated to the
Certificateholders the portion, if any, of the offset for premium (in the case
the issue price of the Certificates exceeds their principal amount) or market
discount income (in the case the principal amount of the Certificates
exceeds their issue price) on the Receivables accruing for a calendar month that
is attributable to such difference.
6
SECTION 2.12. Deduction and Loss Allocations. (a) All items of deduction
and loss of the Issuer shall be allocated in accordance with the General Partner
Percentage to the General Partner and in accordance with the Offered Percentage
to the Depositor.
(b) To the extent that an allocation of the gross amount of deductions and
losses to the General Partner and the Depositor pursuant to Section 2.12(a)
above would cause the Capital Accounts of the General Partner and the Seller to
be reduced below zero such excess deductions and losses shall be allocated to
the Certificateholders (other than the General Partner) on a pro rata basis
until each of their Capital Accounts has been reduced to zero. If any amount of
gross deduction or loss has not been allocated pursuant to the preceding
sentence because all of the Owners' Capital Accounts have been reduced to zero,
the amount of such remaining unallocated deductions or losses shall be allocated
to the General Partner.
(c) If any deductions or losses have been allocated to the
Certificateholders (other than the General Partner) under Section 2.12(b) above,
an amount of gross income shall be allocated to such Certificateholders under
this Section 2.12(c) in subsequent taxable years sufficient to offset the amount
of any deductions or losses previously allocated to such Certificateholders
under Section 2.12(b) above and, thereafter, allocations of gross income and
deductions shall be made in accordance with Sections 2.11 and 2.12(a) of this
Agreement.
SECTION 2.13. Special Allocations. In the event any Certificateholder
unexpectedly receives any adjustments, allocations or distributions described in
Treasury Regulation Section 1.704-1(b)(2)(ii)(d)(4), (5) or (6), items of Issuer
income and gain shall be specially allocated to such Certificateholder in an
amount and manner sufficient to eliminate, to the extent required by the
Treasury Regulations, the deficit, if any, in the balance of the Capital Account
of such Certificateholder as quickly as possible. This Section 2.13 is intended
to comply with the qualified income offset provision in Section
1.704-1(b)(2)(ii)(d) of the Treasury Regulations.
SECTION 2.14. Amended and Restated Trust Agreement. This Agreement amends
and restates in its entirety the Trust Agreement dated as of November 12, 1996
among the Depositor, the General Partner and Owner Trustee.
SECTION 2.15. Required Net Worth of General Partner. For so long as any
Notes or Certificates shall remain outstanding, the General Partner shall take
all actions necessary to maintain its net worth (exclusive of its interests in
the Trust) equal to $4,589,292.83; provided, however, that the General Partner
may maintain a lesser net worth (exclusive of its interest in the Issuer) if it
shall have obtained an opinion from ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ (with a copy to
the Owner Trustee and the Trustee) that the maintenance of such lesser net worth
will not cause the Issuer
7
to be classified as an association taxable as a corporation for United States
federal income tax purposes.
ARTICLE III
CERTIFICATES AND TRANSFER OF INTERESTS
SECTION 3.1 Initial Ownership. Upon the formation of the Issuer by the
contributions by the Depositor and the General Partner pursuant to Section 2.5
and until the issuance of the Certificates, the Depositor and the General
Partner shall be the sole beneficiaries of the Trust.
SECTION 3.2 The Certificates. The Certificates shall be issued in
denominations of $1,000 and integral multiples thereof; provided that one
Certificate may be issued that includes any residual portion of the initial
Certificate Balance in a denomination other than an integral multiple of $1,000.
Upon initial issuance, the Certificates shall each be in the form of Exhibit A,
which is incorporated by reference, and shall be issued as provided in Section
3.10 in an aggregate principal amount equal to the Certificate Balance. The
Certificates shall be executed on behalf of the Issuer by manual or facsimile
signature of an Authorized Officer or other authorized signatory of the Owner
Trustee. 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 Issuer, 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 Certificates or did not hold such offices at the date of authentication
and delivery of such Certificates. No Certificate shall entitle the Holder to
any benefit under this Agreement, or shall be valid for any purpose, unless
there shall appear on such Certificate a certificate of authentication
substantially in the form set forth in Exhibit A, executed by the Owner Trustee
or The Chase Manhattan Bank, as the Owner Trustee's authentication agent, by
manual or facsimile signature; such authentication shall constitute conclusive
evidence that such Certificate shall have been duly authenticated and delivered
hereunder. All Certificates shall be dated the date of their authentication. A
transferee of a Certificate shall become a Certificateholder, and shall be
entitled to the rights and subject to the obligations of a Certificateholder
hereunder, upon due registration of such Certificate in such transferee's name
pursuant to Section 3.4.
SECTION 3.3 Execution, Authentication and Delivery of Certificates.
Concurrently with the transfer of the Receivables to the Issuer pursuant to the
Sale and Servicing Agreement, the Owner Trustee shall cause the Certificates in
an aggregate principal amount equal to the initial Certificate Balance to be
executed on behalf of the Issuer, authenticated and delivered to or upon the
written order of the Depositor, signed by its chairman of the
8
board, its president or any vice president, without further action by the
Depositor, in authorized denominations.
SECTION 3.4 Registration of Transfer and Exchange of Certificates. The
Owner Trustee shall cause to be kept at the office or agency to be maintained
pursuant to Section 3.8 by a certificate registrar (the "Certificate
Registrar"), a register (the "Certificate Register") in which, subject to such
reasonable regulations as it may prescribe, the Certificate Registrar shall
provide for the registration of Certificates and of transfers and exchanges of
Certificates as herein provided. The Chase Manhattan Bank shall be the initial
Certificate Registrar. In the event that, subsequent to the date of issuance of
the Certificates, The Chase Manhattan Bank notifies the Owner Trustee that it is
unable to act as the Certificate Registrar, the Owner Trustee shall act, or the
Owner Trustee shall, with the consent of the Depositor, appoint another bank or
trust company, having an office or agency located in The City of New York and
which agrees to act in accordance with the provisions of this Agreement
applicable to it, to act, as successor Certificate Registrar under this
Agreement.
The Owner Trustee may revoke such appointment and remove The Chase
Manhattan Bank as the Certificate Registrar if the Owner Trustee determines in
its sole discretion that The Chase Manhattan Bank failed to perform its
obligations under this Agreement in any material respect. The Chase Manhattan
Bank shall be permitted to resign as the Certificate Registrar upon 30 days'
written notice to the Owner Trustee, the Depositor and the Issuer; provided,
however, that such resignation shall not be effective and The Chase Manhattan
Bank shall continue to perform its duties as the Certificate Registrar until the
Owner Trustee has appointed a successor Certificate Registrar with the consent
of the Depositor.
An institution succeeding to the corporate agency business of the
Certificate Registrar shall continue to be the Certificate Registrar without the
execution or filing of any paper or any further act on the part of the Owner
Trustee or such Certificate Registrar.
Upon surrender for registration of transfer of any Certificate at the
office or agency maintained pursuant to Section 3.8, the Owner Trustee shall
execute, authenticate and (if the Certificate Registrar is different than the
Owner Trustee, then the Certificate Registrar shall) 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
Certificates in authorized denominations of a like class and aggregate face
amount dated the date of authentication by the Owner Trustee or any
authenticating agent. At the option of a Holder, Certificates may be exchanged
for other Certificates of the same class in authorized denominations of a like
aggregate amount upon surrender of the Certificates to be exchanged at the
office or agency maintained pursuant to Section 3.8.
9
Whenever any Certificate is surrendered for exchange, the Owner Trustee
shall execute, authenticate and (if the Certificate Registrar is different than
the Owner Trustee, then the Certificate Registrar shall) deliver the
Certificates which the Certificateholder making the exchange is entitled to
receive. Every Certificate presented or surrendered for registration of transfer
or exchange shall be accompanied by a written instrument of transfer in form
satisfactory to the Owner Trustee and the Certificate Registrar duly executed by
the Holder, which signature on such assignment must be guaranteed by a member of
the New York Stock Exchange or a commercial bank or trust company.
Each Certificate surrendered for registration of transfer or exchange
shall be canceled and subsequently disposed of by the Owner Trustee or
Certificate Registrar in accordance with its customary practice.
No service charge shall be made for any registration of transfer or
exchange of Certificates, but the Owner Trustee or the Certificate Registrar may
require payment of a sum sufficient to cover any tax or governmental charge that
may be imposed in connection with any transfer or exchange of Certificates.
SECTION 3.5 Mutilated, Destroyed, Lost or Stolen Certificates. If (a) any
mutilated Certificate shall be surrendered to the Certificate Registrar, of if
the Certificate Registrar shall receive evidence to its satisfaction of the
destruction, loss or theft of any Certificate and (b) there shall be delivered
to the Certificate Registrar and the Owner Trustee such security or indemnity as
may be required by them to save each of them harmless, then in the absence of
notice that such Certificate shall have been acquired by a bona fide purchaser,
the Owner Trustee on behalf of Issuer shall execute and the Owner Trustee, or
The Chase Manhattan Bank, as the Owner Trustee's authenticating agent, shall
authenticate and (if the Certificate Registrar is different from the Owner
Trustee, then the Certificate Registrar shall) deliver, in exchange for or in
lieu of any such mutilated, destroyed, lost or stolen Certificate, a new
Certificate of like class, tenor and denomination. If, after delivery of such
replacement Certificate, a bona fide purchaser of the original Certificate in
lieu of which such replacement Certificate was issued presents for payment such
original Certificate, the Owner Trustee or the Certificate Registrar shall be
entitled to recover such replacement Certificate from such Person to whom such
replacement Certificate was delivered or any assignee of such Person, except a
bona fide purchaser, and shall be entitled to recover upon the security or
indemnity provided therefor to the extent of any loss, damage, cost or expense
incurred by the Owner Trustee or the Certificate Registrar in connection
therewith. In connection with the issuance of any new Certificate under this
Section 3.5, the Owner Trustee or the Certificate Registrar may require the
payment of a sum sufficient to cover any tax or other governmental charge that
may be imposed in connection therewith. Any duplicate Certificate issued
pursuant to this Section shall constitute conclusive evidence of an ownership
interest in Issuer,
10
as if originally issued, whether or not the lost, stolen or destroyed
Certificate shall be found at any time. The provisions of this Section 3.5 are
exclusive and shall preclude (to the extent lawful) all other rights and
remedies with respect to the replacement of mutilated, destroyed, lost or stolen
Certificates.
SECTION 3.6 Persons Deemed Certificateholders. Prior to due presentation
of a Certificate for registration of transfer, the Owner Trustee or the
Certificate Registrar may treat the Person in whose name any Certificate shall
be registered in the Certificate Register as the owner of such Certificate for
the purpose of receiving distributions pursuant to Section 5.2 and for all other
purposes whatsoever, and neither the Owner Trustee nor the Certificate Registrar
shall be bound by any notice to the contrary.
SECTION 3.7 Access to List of Certificateholders' Names and Addresses. The
Certificate Registrar shall furnish or cause to be furnished to the Servicer and
the Depositor (and to the Owner Trustee, if the Owner Trustee is not the
Certificate Registrar) within 15 days after receipt by the Certificate Registrar
of a request therefor from the Servicer or the Depositor (or the Owner Trustee)
in writing, a list, in such form as the Servicer or the Depositor (or the Owner
Trustee) may reasonably require, of the names and addresses of the
Certificateholders as of the most recent Record Date. If, at such time, if any,
as Definitive Certificates have been issued, if three or more Holders of
Certificates or one or more Holders of Certificates evidencing not less than 25%
of the Certificate Balance apply in writing to the Certificate Registrar, and
such application states that the applicants desire to communicate with other
Certificateholders with respect to their rights under this Agreement or under
the Certificates and such application is accompanied by a copy of the
communication that such applicants propose to transmit, then the Certificate
Registrar shall, within five Business Days after the receipt of such
application, afford such applicants access during normal business hours to the
current list of Certificateholders. Each Holder, by receiving and holding a
Certificate, shall be deemed to have agreed to hold none of the Depositor, the
Certificate Registrar, the Servicer 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 3.8 Maintenance of Office or Agency. The Owner Trustee shall
maintain in The City of New York, an office or offices or agency or agencies
where Certificates may be surrendered for registration of transfer or exchange.
The Owner Trustee initially designates the offices of The Chase Manhattan Bank
located at ▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇ as its office for
such purposes. The Owner Trustee shall give prompt written notice to the
Depositor, the Servicer and to the Certificateholders of any change in the
location of the Certificate Register or any such office or agency.
SECTION 3.9 Appointment of Paying Agent. The Owner Trustee may appoint a
Paying Agent with respect to the Certificates. The Owner
11
Trustee hereby appoints The Chase Manhattan Bank as the initial Paying Agent.
The Paying Agent shall have the revocable power to withdraw funds from the
Certificate Distribution Account, make distributions to Certificateholders from
the Certificate Distribution Account pursuant to Section 5.2 and shall report
the amounts of such distributions to the Owner Trustee. 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 or for other good
cause. The Paying Agent shall be permitted to resign upon 30 days' written
notice to the Owner Trustee and the Servicer. 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 and may be the Owner
Trustee), with the consent of the Depositor (which consent shall not be
unreasonably withheld). The Owner Trustee shall cause such successor Paying
Agent or any additional Paying Agent appointed by the Owner Trustee (unless it
is 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 the
removal of a Paying Agent, such Paying Agent shall also return all funds in its
possession to the Owner Trustee. The provisions of Sections 7.1, 7.3, 7.4, 7.6,
8.1 and 8.2 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 Book-Entry Certificates. Except as specified in Section 3.15,
the Certificates, upon original issuance, will be issued in the form of a
typewritten Certificate or Certificates representing Book-Entry Certificates, to
be delivered to The Depository Trust Company, the initial Clearing Agency, by or
on behalf of the Issuer. Such Book-Entry Certificate or Certificates shall
initially be registered on the Certificate Register in the name of Cede & Co.,
the nominee of the initial Clearing Agency, and no beneficial owner (other than
the General Partner) will receive a definitive Certificate representing such
beneficial owner's interest in such Certificate, except as provided in Section
3.12. Unless and until Definitive Certificates have been issued to beneficial
owners pursuant to Section 3.12:
(a) the provisions of this Section 3.10 shall be in full force and
effect;
12
(b) the Certificate Registrar, the Paying Agent and the Owner
Trustee shall be entitled to deal with the Clearing Agency and the
Clearing Agency Participants for all purposes of this Agreement relating
to the Book-Entry Certificates (including the payment of principal of and
interest on the Book-Entry Certificates and the giving of instructions or
directions to Certificate Owners of Book-Entry Certificates) as the sole
Holder of Book-Entry Certificates and shall have no obligations to
Certificate Owners thereof;
(c) to the extent that the provisions of this Section conflict with
any other provisions of this Agreement, the provisions of this Section
shall control;
(d) the rights of Certificate Owners of the Book-Entry Certificates
shall be exercised only through the Clearing Agency (or to the extent
Certificateholders are not Clearing Agency Participants, through the
Clearing Agency Participants through which such Certificateholders own
Book-Entry Certificates), and shall be limited to those established by law
and agreements between such Certificate Owners and the Clearing Agency
and/or Clearing Agency Participants, and all references in this Agreement
to actions by Certificateholders shall refer to actions taken by the
Clearing Agency upon instructions from the Clearing Agency Participants,
and all references in this Agreement to distributions, notices, reports
and statements to Certificateholders shall refer to distributions,
notices, reports and statements to the Clearing Agency, as registered
holder of the Certificates, as the case may be, for distribution to
Certificateholders in accordance with the procedures of the Clearing
Agency. Pursuant to the Certificate Depository Agreement, unless and until
Definitive Certificates are issued pursuant to Section 3.12, the initial
Clearing Agency will make book-entry transfers among Clearing Agency
Participants and receive and transmit payments of principal of and
interest on the Book-Entry Certificates to such Clearing Agency
Participants; and
(e) whenever this Agreement requires or permits actions to be taken
based upon instructions or directions of the Holders of Certificates
evidencing a specified percentage of the Certificate Balance, the Clearing
Agency shall be deemed to represent such percentage only to the extent
that it has received instructions to such effect from Certificate Owners
and/or Clearing Agency Participants owning or representing, respectively,
such required percentage of the beneficial interest in the Book-Entry
Certificates and has delivered such instructions to the Owner Trustee.
SECTION 3.11 Notices to Clearing Agency. Whenever a notice or other
communication to Certificateholders is required under this Agreement, unless and
until Definitive Certificates shall have been issued to Certificate Owners
pursuant to Section 3.12, the Owner Trustee and the Paying Agent shall give all
such notices and communications specified herein to be given to
Certificateholders
13
to the Clearing Agency, and shall have no obligations to Certificate Owners.
SECTION 3.12 Definitive Certificates. If (a) the Servicer advises the
Owner Trustee in writing that the Clearing Agency is no longer willing or able
to properly discharge its responsibilities with respect to the Certificates, and
the Servicer is unable to locate a qualified successor, (b) the Servicer at its
option elects to terminate the book-entry system through the Clearing Agency, or
(c) after the occurrence of an Event of Servicing Termination or Event of
Default, Certificate Owners of the Certificates representing beneficial
interests aggregating not less than 50% of the Certificate Balance advise the
Clearing Agency through the Clearing Agency Participants, and the Owner Trustee,
in writing, and if the Clearing Agency shall so notify the Owner Trustee, that
the continuation of a book-entry system through the Clearing Agency is no longer
in the best interests of Certificate Owners, then the Owner Trustee shall notify
the Clearing Agency of the occurrence of any such event, which shall be
responsible to notify the Certificate Owners of the occurrence of such event and
of the availability of the Definitive Certificates to Certificate Owners
requesting the same. Upon surrender to the Certificate Registrar of the
typewritten Certificate or Certificates representing the Book-Entry Certificates
by the Clearing Agency, accompanied by re-registration instructions, the Owner
Trustee shall execute, authenticate, or cause to be authenticated, and (if the
Certificate Registrar is different than the Owner Trustee, then the Certificate
Registrar shall) deliver the Definitive Certificates in accordance with the
instructions of the Clearing Agency. Neither the Certificate Registrar nor the
Owner Trustee shall be liable for any delay in delivery of such instructions and
may conclusively rely on, and shall be protected in relying on, such
instructions. Upon the issuance of Definitive Certificates, all references
herein to obligations imposed upon or to be performed by the Clearing Agency
shall be deemed to be imposed upon and performed by the Certificate Registrar,
to the extent applicable with respect to such Definitive Certificates, and the
Owner Trustee and the Paying Agent shall recognize the Holders of the Definitive
Certificates as Certificateholders. The Definitive Certificates shall be
printed, lithographed or engraved or may be produced in any other matter as is
reasonably acceptable to the Owner Trustee, as evidenced by its execution
thereof.
SECTION 3.13 Authenticating Agent.
(a) The Owner Trustee may appoint one or more authenticating agents with
respect to the Certificates which shall be authorized to act on behalf of the
Owner Trustee in authenticating the Certificates in connection with the
issuance, delivery, registration of transfer, exchange or repayment of the
Certificates. The Owner Trustee hereby appoints The Chase Manhattan Bank as
Authenticating Agent for the authentication of Certificates upon any
registration of transfer or exchange of such Certificates. Whenever reference is
made in this Agreement to the
14
authentication of Certificates by the Owner Trustee or the Owner Trustee's
certificate of authentication, such reference shall be deemed to include
authentication on behalf of the Owner Trustee by an authenticating agent and a
certificate of authentication executed on behalf of the Owner Trustee by an
authenticating agent. Each authenticating agent (other than The Chase Manhattan
Bank) shall be subject to acceptance by the Depositor.
(b) Any institution succeeding to the corporate agency business of an
authenticating agent shall continue to be an authenticating agent without the
execution or filing of any paper or any further act on the part of the Owner
Trustee or such authenticating agent.
(c) An authenticating agent may at any time resign by giving written
notice of resignation to the Owner Trustee and the Depositor. The Owner Trustee
may at any time terminate the agency of an authenticating agent by giving notice
of termination to such authenticating agent and to the Depositor. Upon receiving
such a notice of resignation or upon such a termination, or in case at any time
an authenticating agent shall cease to be acceptable to the Owner Trustee or the
Depositor, the Owner Trustee promptly may appoint a successor authenticating
agent with the consent of the Depositor. Any successor authenticating agent upon
acceptance of its appointment hereunder shall become vested with all the rights,
powers and duties of its predecessor hereunder, with like effect as if
originally named as an authenticating agent.
(d) The Servicer shall pay the authenticating agent from time to time
reasonable compensation for its services under this Section 3.13.
(e) The provisions of Sections 7.1, 7.3, 7.4, 7.6, 8.1 and 8.2 shall be
applicable to any authenticating agent.
(f) Pursuant to an appointment made under this Section 3.13, the
Certificates may have endorsed thereon, in lieu of the Owner Trustee's
certificate of authentication, an alternate certificate of authentication in
substantially the following form:
This is one of the Certificates referred to in the within mentioned
Agreement.
__________________________________,
as Owner Trustee
By: ___________________________________
Authorized Officer
or
___________________________________
as Authenticating Agent
for the Owner Trustee,
15
___________________________________
Authorized Officer
SECTION 3.14 Actions of Certificateholders.
(a) Any request, demand, authorization, direction, notice, consent, waiver
or other action provided by this Agreement to be given or taken by the
Certificateholders may be embodied in and evidenced by one or more instruments
of substantially similar tenor signed by such Certificateholders in person or by
agent duly appointed in writing; and except as herein otherwise expressly
provided, such action shall become effective when such instrument or instruments
are delivered to the Owner Trustee and, when required, to the Depositor or the
Servicer. Proof of execution of any such instrument or of a writing appointing
any such agent shall be sufficient for any purpose of this Agreement and
conclusive in favor of the Owner Trustee, the Depositor and the Servicer, if
made in the manner provided in this Section 3.14.
(b) The fact and date of the execution by any Certificateholder of any
such instrument or writing may be proved in any reasonable manner which the
Owner Trustee deems sufficient.
(c) Any request, demand, authorization, direction, notice, consent, waiver
or other act by a Certificateholder shall bind every Holder of every Certificate
issued upon the registration of transfer thereof or in exchange therefor or in
lieu thereof, in respect of anything done, or omitted to be done, by the Owner
Trustee, the Depositor or the Servicer in reliance thereon, regardless of
whether notation of such action is made upon such Certificate.
(d) The Owner Trustee may require such additional proof of any matter
referred to in this Section 3.14 as it shall deem necessary.
SECTION 3.15 Disposition of Certificates by General Partner. On the
Closing Date, the Depositor shall transfer to the General Partner Definitive
Certificates representing the General Partner's Percentage of the Certificate
Balance and the General Partner shall, at all times thereafter, retain
beneficial and record ownership of such Definitive Certificates. Any attempted
transfer of any such Definitive Certificate that would reduce such interest of
the General Partner below 1.00% of the Certificate Balance shall be void. The
Owner Trustee shall cause any such Definitive Certificate issued to the General
Partner to contain a legend stating "THIS CERTIFICATE IS NOT TRANSFERABLE."
ARTICLE IV
ACTIONS BY OWNER TRUSTEE
16
SECTION 4.1 Prior Notice to Certificateholders with Respect to Certain
Matters. With respect to the following matters, the Owner Trustee shall not take
action unless at least 30 days before the taking of such action, the Owner
Trustee shall have notified the Certificateholders in writing of the proposed
action and the Certificateholders shall not have notified the Owner Trustee in
writing prior to the 30th day after such notice is given that such
Certificateholders have withheld consent or provided alternative direction:
(a) the initiation of any material claim or lawsuit by the Issuer
(except claims or lawsuits brought in connection with the collection of
the Receivables) and the compromise of any material action, claim or
lawsuit brought by or against the Issuer (except with respect to the
aforementioned claims or lawsuits for collection of the Receivables);
(b) the election by the Issuer to file an amendment to the
Certificate of Trust (unless such amendment is required to be filed under
the Business Trust Statute);
(c) the amendment of the Indenture by a supplemental indenture in
circumstances where the consent of any Noteholder is required;
(d) the amendment of the Indenture by a supplemental indenture in
circumstances where the consent of any Noteholder is not required and such
amendment materially adversely affects the interest of the
Certificateholders;
(e) the amendment, change or modification of the Sale and Servicing
Agreement, except to any amendment where the consent of any
Certificateholder is not required under the terms of the Sale and
Servicing Agreement; or
(f) the appointment pursuant to the Indenture of a successor Trustee
or the consent to the assignment by the Note Registrar, the Paying
Agent, the Trustee or the Certificate Registrar of its obligations
under the Indenture or this Agreement, as applicable.
The Owner Trustee shall notify the Certificateholders in writing of any
appointment of a successor Paying Agent, Authenticating Agent or Certificate
Registrar within five Business Days thereof.
SECTION 4.2 Action by Certificateholders with Respect to Certain Matters.
The Owner Trustee shall not have the power, except upon the direction of the
Certificateholders, to (a) remove the Servicer under the Sale and Servicing
Agreement pursuant to Article VIII thereof, (b) remove the Administrator under
the Administration Agreement pursuant to Section 8 thereof or (c) except as
expressly provided in the Basic Documents, sell the Receivables or any interest
therein after the termination of the Indenture. The Owner Trustee shall take the
actions referred to in
17
the preceding sentence only upon written instructions signed by the
Certificateholders.
SECTION 4.3 Action by Certificateholders with Respect to Bankruptcy. The
Owner Trustee shall not have the power to commence a voluntary proceeding in
bankruptcy relating to the Issuer without the unanimous prior approval of all
Certificateholders unless the Owner Trustee reasonably believes that the Issuer
is insolvent.
SECTION 4.4 Restrictions on Certificateholders' Power. The
Certificateholders shall not direct the Owner Trustee to take or refrain from
taking any action if such action or inaction would be contrary to any obligation
of the Issuer or the Owner Trustee under this Agreement or any of the other
Basic Documents or would be contrary to Section 2.3 nor shall the Owner Trustee
be obligated to follow any such direction, if given.
SECTION 4.5 Majority Control. Except as expressly provided herein, any
action that may be taken by the Certificateholders under this Agreement may be
taken by the Holders of Certificates evidencing not less than a majority of the
Certificate Balance. Except as expressly provided herein, any written notice of
the Certificateholders delivered pursuant to this Agreement shall be effective
if signed by the Holders of 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 5.1 Establishment of Certificate Distribution Account. The Owner
Trustee, for the benefit of Certificateholders, shall establish and maintain in
the name of the Issuer 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. Except as
otherwise provided herein, the Certificate Distribution Account shall be under
the sole dominion and control of the Owner Trustee 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. If, at any time, the Certificate Distribution Account ceases
to be an Eligible Deposit Account, the Servicer shall establish a new
Certificate Distribution Account as an Eligible Deposit Account in accordance
with Section 5.1(b) of the Sale and Servicing Agreement, and the Owner Trustee
shall transfer any cash and/or any investments to such new Certificate
Distribution Account and shall assist the Servicer in establishing such account
as necessary.
Amounts on deposit in the Certificate Distribution Account shall not be
invested.
18
SECTION 5.2 Application of Funds in Certificate Distribution Account. (a)
Not later than 12:00 noon, New York City time, on each Distribution Date, the
Owner Trustee or the Paying Agent on behalf of the Owner Trustee will, based on
the information contained in the Servicer's Certificate delivered on the related
Determination Date pursuant to Section 4.8 of the Sale and Servicing Agreement,
distribute to Certificateholders, to the extent of the funds available, amounts
deposited in the Certificate Distribution Account pursuant to Section 5.5 of the
Sale and Servicing Agreement on such Distribution Date in the following order of
priority:
(i) first, to the Certificateholders (including the General
Partner), on a pro rata basis, an amount equal to the Certificateholders'
Interest Distributable Amount; and
(ii) second, to the Certificateholders (including the General
Partner), on a pro rata basis, an amount equal to the Certificateholders'
Principal Distributable Amount.
(b) On each Distribution Date, the Owner Trustee shall send, or cause to
be sent, to each Certificateholder the statement provided to the Owner Trustee
by the Servicer pursuant to Section 5.8 of the Sale and Servicing Agreement on
such Distribution Date.
(c) In the event that any withholding tax is imposed on the Issuer's
payment (or allocations of income) to a Certificateholder, such tax shall reduce
the amount otherwise distributable to the Certificateholder in accordance with
this Section. The Owner Trustee is hereby authorized and directed to retain from
amounts otherwise distributable to the Certificateholders sufficient funds for
the payment of any tax that is legally owed by the Issuer (but such
authorization shall not prevent the Owner Trustee from contesting any such tax
in appropriate proceedings, and withholding payment of such tax, if permitted by
law, pending the outcome of such proceedings). The amount of any withholding tax
imposed with respect to a Certificateholder shall be treated as cash distributed
to such Certificateholder at the time it is withheld by the Issuer and remitted
to the appropriate taxing authority. The Owner Trustee intends to withhold
United States withholding taxes from any amounts allocable or distributed to
non-United States Certificateholders at a rate of 35% for non-United States
Certificateholders that are classified as corporations for United States federal
income tax purposes and at a rate of 39.6% for all other non-United States
Certificateholders. In the event that a Certificateholder wishes to apply for a
refund of any such withholding tax, the Owner Trustee shall reasonably cooperate
with such Certificateholder in making such claim so long as such
Certificateholder agrees to reimburse the Owner Trustee for any out-of-pocket
expenses incurred.
SECTION 5.3 Method of Payment. Subject to Section 9.1(c), distributions
required to be made to Certificateholders on any Distribution Date shall be made
to each Certificateholder of record on the preceding Record Date either (a) by
wire transfer, in
19
immediately available funds, to the account of such Holder 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
Certificates in the aggregate evidence a denomination of not less than
$1,000,000 or (b) by check mailed to such Certificateholder at the address of
such Holder appearing in the Certificate Register; provided that, unless
Definitive Certificates have been issued pursuant to Section 3.12, with respect
to Certificates registered on the Record Date in the name of the nominee of the
Clearing Agency (initially, such nominee to be Cede & Co.), distributions will
be made by wire transfer in immediately available funds to the account
designated by such nominee.
SECTION 5.4 No Segregation of Monies; No Interest. Subject to Sections 5.1
and 5.2, monies received by the Owner Trustee or any Paying Agent hereunder need
not be segregated in any manner except to the extent required by law and may be
deposited under such general conditions as may be prescribed by law, and neither
the Owner Trustee nor any Paying Agent shall be liable for any interest thereon.
SECTION 5.5 Accounting and Reports to the Noteholders, Certificateholders,
the Internal Revenue Service and Others. The Owner Trustee shall (a) maintain
(or cause to be maintained) the books of the Issuer on a calendar year basis on
the accrual method of accounting, (b) deliver (or cause to be delivered) to each
Certificateholder, as may be required by the Code and applicable Treasury
Regulations, such information as may be required (including Schedule K-1) to
enable each Certificateholder to prepare its Federal and state income tax
returns, (c) prepare or cause to be prepared and file such tax returns relating
to the Issuer (including a partnership information return, Form 1065), and
make such elections as may from time to time be required or appropriate under
any applicable state or Federal statute or rule or regulation thereunder so as
to maintain the Trust's characterization as a partnership for Federal income tax
purposes and (d) collect or cause to be collected any withholding tax as
described in and in accordance with Section 5.2(c) with respect to income or
distributions to Certificateholders. The General Partner shall sign all tax
information returns filed pursuant to this Section 5.5 and any other returns as
may be required by law. The Owner Trustee shall elect under Section 1278 of the
Code to include in income currently any market discount that accrues with
respect to the Receivables. The Owner Trustee shall not make the election
provided under Section 754 of the Code.
SECTION 5.6 Signature on Returns; Tax Matters Partner. (a) Notwithstanding
the provisions of Section 5.5, the General Partner shall sign on behalf of the
Issuer the tax returns of the Issuer, unless applicable law requires the Owner
Trustee to sign such documents, in which case such documents shall be signed by
the Owner Trustee at the written direction of the General Partner.
20
(b) The General Partner shall be the "tax matters partner" of the Issuer
pursuant to the Code.
SECTION 5.7 Capital Accounts. The Issuer shall maintain accounts ("Capital
Accounts") with respect to each Certificateholder, the Depositor and the General
Partner (each an "Owner"). For this purpose, Capital Accounts shall be
maintained in accordance with the following provisions:
(a) Each Owner's Capital Account shall be increased by the Capital
Contributions (as defined below) of such Owner, such Owner's distributive
share of gross income (if any) and any items in the nature of income or
gain that are allocated to such Owner pursuant to Section 2.11, 2.12(b) or
2.13.
(b) Each Owner's Capital Account shall be reduced by any amount
distributed to such Owner (including, in the case of the General Partner
and the Depositor, any amount released or otherwise distributed to the
General Partner or the Depositor from the Reserve Account under Section
5.6 of the Sale and Servicing Agreement) and any items in the nature of
deductions or losses that are allocated to such Owner pursuant to Section
2.12 or 2.13.
(c) In the event all or a portion of a Certificate is transferred in
accordance with the terms of this Agreement, the transferee shall succeed
to the Capital Account of the transferor to the extent it related to such
Certificate or a portion thereof.
"Capital Contribution" means the amount of any cash contributed to the
Issuer by an Owner (including any amounts deemed to be contributed in connection
with the original issuance of the Certificates), including, in the case of the
Depositor, the amount of any Receivables deemed to have been contributed by the
Depositor (with such amount for Receivables intended to reflect the amount of
the Receivables and monies due thereon or with respect thereto, including
accrued but unpaid interest and finance charges, conveyed to the Issuer by the
Depositor on the Closing Date under Article II of the Sale and Servicing
Agreement). The foregoing provisions and the other provisions of this Agreement
relating to the maintenance of Capital Accounts are intended to comply with
section 1.704-l(b) of the Treasury Regulations and shall be interpreted in a
manner consistent therewith.
SECTION 5.8 Reserve Account. In accordance with the provisions of the Sale
and Servicing Agreement, all amounts distributed to the General Partner and the
Depositor by the Servicer pursuant to Sections 5.6(d), 9.1(b) and 9.1(d) of the
Sale and Servicing Agreement shall be distributed in accordance with the General
Partner Percentage to the General Partner and in accordance with the Offered
Percentage to the Depositor.
21
ARTICLE VI
AUTHORITY AND DUTIES OF OWNER TRUSTEE
SECTION 6.1 General Authority. The Owner Trustee is authorized and
directed to execute and deliver the Basic Documents to which the Issuer is named
as a party and each certificate or other document attached as an exhibit to or
contemplated by the Basic Documents to which the Issuer is named as a party and
any amendment thereto, in each case, in such form as the Depositor shall approve
as evidenced conclusively by the Owner Trustee's execution thereof, and, on
behalf of the Issuer at the written direction of the Depositor, to direct the
Trustee to authenticate and deliver Class A-1 Notes in the aggregate principal
amount of $225,000,000, Class A-2 Notes in the aggregate principal amount of
$239,000,000, Class A-3 Notes in the aggregate principal amount of $324,000,000
and Class A-4 Notes in the aggregate principal amount of $178,000,000. In
addition to the foregoing, the Owner Trustee is authorized, but shall not be
obligated, to take all actions required of the Issuer pursuant to the Basic
Documents. The Owner Trustee is further authorized from time to time to take
such action as the Administrator recommends or directs in writing with respect
to the Basic Documents.
SECTION 6.2 General Duties. It shall be the duty of the Owner Trustee to
discharge (or cause to be discharged) all of its responsibilities pursuant to
the terms of this Agreement and the other Basic Documents and to administer the
Issuer in the interest of Certificateholders, subject to the Basic Documents and
in accordance with the provisions of this Agreement. Notwithstanding the
foregoing, the Owner Trustee shall be deemed to have discharged its duties and
responsibilities hereunder and under the Basic Documents to the extent the
Administrator has agreed in the Administration Agreement to perform any act or
to discharge any duty of the Owner Trustee or the Issuer hereunder or under any
other Basic Document, and the Owner Trustee shall not be liable for the default
or failure of the Administrator to carry out its obligations under the
Administration Agreement.
SECTION 6.3 Action upon Instruction. (a) Subject to Article IV, the
Certificateholders may, by written instruction, direct the Owner Trustee in the
management of the Issuer. Such direction may be exercised at any time by written
instruction of the Certificateholders pursuant to Section 4.5.
(b) Notwithstanding the foregoing, the Owner Trustee shall not be required
to take any action hereunder or under any other Basic Document if (i) the Owner
Trustee shall reasonably determine, or shall have been advised by counsel in
writing, that such action is likely to result in personal liability to the Owner
Trustee (in such capacity or individually), is contrary to the terms of this
Agreement or any other Basic Document or is contrary to law.
(c) Whenever the Owner Trustee is unable to decide between alternative
courses of action permitted or required by the terms of
22
this Agreement or any other Basic Document or is unsure as to the application of
any provision of this Agreement or any Basic Document, or if 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 shall promptly give notice (in such
form as shall be appropriate under the circumstances) to the Certificateholders
requesting instruction as to the course of action to be adopted, and to the
extent the Owner Trustee acts in good faith in accordance with any written
instruction of the Certificateholders received, the Owner Trustee shall not be
liable on account of such action to any Person. If the Owner Trustee shall not
have received appropriate instruction within ten days of such notice (or within
such shorter period of time as reasonably may be specified in such notice or may
be necessary under the circumstances) it may, but shall be under no duty to,
take or refrain from taking such action, not inconsistent with this Agreement or
the other Basic Documents, as it shall deem to be in the best interests of the
Certificateholders, and shall have no liability to any Person for such action or
inaction.
SECTION 6.4 No Duties Except as Specified in this Agreement or in
Instructions. The Owner Trustee shall undertake to perform such duties and only
such duties as are specifically set forth in this Agreement and the other Basic
Documents, and no implied covenants or obligations shall be read into this
Agreement or the other Basic Documents. The Owner Trustee shall not have any
duty or obligation to manage, make any payment with respect to, register,
record, sell, dispose of, or otherwise deal with the Owner Trust Estate, or to
otherwise take or refrain from taking any action under, or in connection with,
any document contemplated hereby to which the Owner Trustee is a party, except
as expressly provided by the terms of this Agreement or in any document or
written instruction received by the Owner Trustee pursuant to Section 6.3; and
no implied duties or obligations shall be read into this Agreement or any Basic
Document against the Owner Trustee. The Owner Trustee shall have no
responsibility for filing any financing or continuation statement in any public
office at any time or to otherwise perfect or maintain the perfection of any
security interest or lien granted to it hereunder or to prepare or file any
Commission filing for the Issuer or to record this Agreement or any other Basic
Document. The Owner Trustee nevertheless agrees that it will, at its own cost
and expense, promptly take all action as may be necessary to discharge any Liens
on any part of the Owner Trust Estate that result from actions by, or claims
against, the Owner Trustee, in its individual capacity, that are not related to
the ownership or the administration of the Owner Trust Estate.
SECTION 6.5 No Action Except under Specified Documents or Instructions.
The Owner Trustee shall not manage, control, use, sell, dispose of or otherwise
deal with any part of the Owner Trust
23
Estate except (i) in accordance with the powers granted to and the authority
conferred upon the Owner Trustee pursuant to this Agreement, (ii) in accordance
with the Basic Documents, and (iii) in accordance with any document or
instruction delivered to the Owner Trustee pursuant to Section 6.3.
SECTION 6.6 Restrictions. The Owner Trustee shall not (a) take any action
that is inconsistent with the purposes of the Issuer set forth in Section 2.3 or
(b) take any action or amend this Agreement in any manner that, to the best
knowledge of the Owner Trustee, would result in the Trust's becoming taxable as
a corporation for United States federal income tax purposes. The
Certificateholders shall not direct the Owner Trustee to take action that would
violate the provisions of this Section.
SECTION 6.7 Doing Business in Other Jurisdictions. (a) Notwithstanding
anything contained herein to the contrary, the Owner Trustee shall not be
required to take any action in any jurisdiction other than in the State of
Delaware, other than as set forth in the last sentence of this Section 6.7, if
the taking of such action will (i) require the consent or approval or
authorization or order of or the giving of notice to, or the registration with
or the taking of any other action in respect of, any state or other governmental
authority or agency of any jurisdiction other than the State of Delaware; (ii)
result in any fee, tax or other governmental charge under the laws of any
jurisdiction or any political subdivisions thereof in existence on the date
hereof other than the State of Delaware becoming payable by the Owner Trustee;
or (iii) subject the Owner Trustee to personal jurisdiction in any jurisdiction
other than the State of Delaware for causes of action arising from acts
unrelated to the consummation of the transactions by the Owner Trustee, as the
case may be, contemplated hereby. The Owner Trustee shall be entitled to obtain
advice of counsel (which advice shall be an expense of the Depositor) to
determine whether any action required to be taken pursuant to this Agreement
results in the consequences described in clauses (i), (ii) and (iii) of the
preceding sentence. In the event that said counsel advises the Owner Trustee
that such action will result in such consequences, the Owner Trustee will
appoint an additional trustee pursuant to Section 10.5 hereof to proceed with
such action.
ARTICLE VII
CONCERNING OWNER TRUSTEE
SECTION 7.1 Acceptance of Trusts and Duties. The Owner Trustee accepts the
trusts hereby created and agrees to perform its duties hereunder with respect to
such trusts but only upon the terms of this Agreement. The Owner Trustee also
agrees to disburse all moneys actually received by it constituting part of the
Owner Trust Estate upon the terms of the other Basic Documents and this
Agreement. The Owner Trustee shall not be answerable or accountable hereunder or
under any Basic Document under any
24
circumstances, except (i) for its own willful misconduct, bad faith or gross
negligence or (ii) in the case of the breach of any representation or warranty
contained in Section 7.3 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 in good faith by a Responsible Officer of the Owner Trustee unless it
is proved that the Owner Trustee was grossly negligent in ascertaining the
pertinent facts;
(b) The Owner Trustee shall not be liable with respect to any action
it takes or omits to take in good faith in accordance with the
instructions of the Certificateholders given pursuant to Section 6.3;
(c) No provision of this Agreement or any other Basic Document shall
require the Owner Trustee to expend or risk funds or otherwise incur any
financial liability in its own performance of any of its rights or powers
hereunder or under any other 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 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 and makes no
representation as to the validity or adequacy 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
Certificates, shall not be accountable for the use or application by the
Depositor of the proceeds from the Certificates, and the Owner Trustee
shall in no event assume or incur any liability, duty or obligation to any
Noteholder or to any Certificateholder, other than as expressly provided
for herein and in the Basic 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 the ability of the Owner Trust Estate to generate the payments to be
distributed to Certificateholders under this Agreement or the Noteholders
under the Indenture, including: the existence, condition and ownership of
any Financed Vehicle; the existence and enforceability of any insurance
thereon; the existence and
25
contents of any Receivable on any computer or other record thereof; the
validity of the assignment of any Receivable to the Issuer or of any
intervening assignment; the completeness of any Receivable; the
performance or enforcement of any Receivable; the compliance by the
Depositor or the Servicer with any warranty or representation made under
any Basic Document or in any related document or the accuracy of any such
warranty or representation or any action of the Trustee or the Servicer or
any subservicer taken in the name of the Owner Trustee;
(f) The Owner Trustee shall not be liable for the default or
misconduct of the Trustee or the 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 Issuer under this Agreement or the Basic
Documents that are required to be performed by the Administrator under the
Administration Agreement, the Trustee under the Indenture or the Servicer
under the Sale and Servicing Agreement;
(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 other Basic Document, at the request,
order or direction of any of the Certificateholders, unless such
Certificateholders have offered to the Owner Trustee security or indemnity
satisfactory to it against the costs, expenses and liabilities that may be
incurred by the Owner Trustee therein or thereby. The right of the Owner
Trustee to perform any discretionary act enumerated in this Agreement or
in any other Basic Document shall not be construed as a duty, and the
Owner Trustee shall not be answerable for other than its negligence, bad
faith or willful misconduct in the performance of any such act; and
(h) The Owner Trustee, upon receipt of any resolutions,
certificates, statements, opinions, reports, documents, orders or other
instruments furnished to the Owner Trustee that shall be specifically
required to be furnished pursuant to any provision of this Agreement or
the other Basic Documents, shall examine them to determine whether they
conform to the requirements of this Agreement or such other Basic
Document; provided, however, that the Owner Trustee shall not be
responsible for the accuracy or content of any such resolution,
certificate, statement, opinion, report, document, order or other
instrument furnished to the Owner Trustee pursuant to this Agreement or
the other Basic Documents.
SECTION 7.2 Furnishing of Documents. The Owner Trustee shall furnish to
the Certificateholders promptly upon receipt of a written request therefor,
duplicates or copies of all reports, notices, requests, demands, certificates,
financial statements and
26
any other instruments furnished to the Owner Trustee under the Basic Documents.
SECTION 7.3 Representations and Warranties. The Owner Trustee hereby
represents and warrants to the Depositor, for the benefit of the
Certificateholders, that:
(a) It is a banking corporation duly organized and validly
existing in good standing under the laws of the State of Delaware
and having an office within the State of Delaware. It has all
requisite corporate power, authority and legal right to execute,
deliver and perform its obligations under this Agreement.
(b) It has taken all corporate action necessary to authorize
the execution and delivery by it of this Agreement, and this
Agreement will be executed and delivered by one of its officers who
is duly authorized to execute and deliver this Agreement on its
behalf.
(c) Neither the execution nor the delivery by it of this
Agreement, nor the consummation by it of the transactions
contemplated hereby nor compliance by it with any of the terms or
provisions hereof will contravene any federal or Delaware law,
governmental rule or regulation governing the banking or trust
powers of the Owner Trustee or any judgment, writ, decree or order
applicable to it, or constitute any default under its charter
documents or by-laws or, with or without notice or lapse of time,
any indenture, mortgage, contract, agreement or instrument to
which it is a party or by which any of its properties may be bound.
(d) The execution, delivery and performance by the Owner
Trustee of this Agreement does not require the authorization,
consent, or approval of, the giving of notice to, the filing or
registration with, or the taking of any other action in respect of,
any governmental authority or agency regulating the corporate trust
activities of the Owner Trustee.
(e) This Agreement has been duly authorized, executed and
delivered by the Owner Trustee and shall constitute the legal,
valid, and binding agreement of the Owner Trustee, enforceable in
accordance with its terms, except as such enforcement may be limited
by bankruptcy, insolvency, reorganization and other laws affecting
the rights of creditors generally, and by general principles of
equity regardless of whether enforcement is pursuant to a proceeding
in equity or at law.
SECTION 7.4 Reliance; Advice of Counsel. (a) The Owner Trustee shall incur
no liability to anyone in acting upon any signature, instrument, notice,
resolution, request, consent, order, certificate, report, opinion, bond or other
27
document or paper believed by it to be genuine and believed by it to be signed
by the proper party or parties. The Owner Trustee may accept a certified copy of
a resolution of the board of directors or other governing body of any corporate
party as conclusive evidence that such resolution has been duly adopted by such
body and that the same is in full force and effect. As to any fact or matter the
method of the determination of which is not specifically prescribed herein, the
Owner Trustee may for all purposes hereof rely on a certificate, signed by the
president or any vice president or by the treasurer, secretary or other
authorized officers of the relevant party, as to such fact or matter, and such
certificate shall constitute full protection to the Owner Trustee for any action
taken or omitted to be taken by it in good faith in reliance thereon.
(b) In the exercise or administration of the trusts hereunder and in the
performance of its duties and obligations under this Agreement or the Basic
Documents, the Owner Trustee (i) may act directly or through its agents or
attorneys pursuant to agreements entered into with any of them, and the Owner
Trustee shall not be liable for the conduct or misconduct of such agents or
attorneys if such agents or attorneys shall have been selected by the Owner
Trustee with due care and (ii) may consult with counsel, accountants and other
skilled persons knowledgeable in the relevant area 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 7.5 Not Acting in Individual Capacity. Except as provided in this
Article VII, in accepting the trusts hereby created Wilmington Trust Company
acts solely as the Owner Trustee hereunder and not in its individual capacity
and all Persons having any claim against the Owner Trustee by reason of the
transactions contemplated by this Agreement or any Basic Document shall look
only to the Owner Trust Estate for payment or satisfaction thereof.
SECTION 7.6 Owner Trustee May Own Certificates and Notes. The Owner
Trustee in its individual or any other capacity may become the owner or pledgee
of the Certificates or the Notes and may deal with the Depositor, the Trustee
and the Servicer in banking transactions with the same rights as it would have
if it were not the Owner Trustee.
ARTICLE VIII
COMPENSATION OF OWNER TRUSTEE
SECTION 8.1 Owner Trustee's Fees and Expenses. The Owner Trustee shall
receive as compensation for its services hereunder such fees as have been
separately agreed upon before the date hereof between the Servicer and the Owner
Trustee, and the Owner Trustee shall be entitled to be reimbursed by the
Servicer for its
28
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 except any such expenses as may arise
from its gross negligence, wilful misfeasance, or bad faith or that is the
responsibility of Certificateholders under this Agreement.
SECTION 8.2 Indemnification. The Servicer shall be liable as primary
obligor for, and shall indemnify the Owner Trustee (in such capacity or
individually) 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 other 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 Servicer shall not be liable for or required to
indemnify the Owner Trustee from and against Expenses arising or resulting from
any of the matters described in the third sentence of Section 7.1. The
indemnities contained in this Section shall survive the resignation or
termination of the Owner Trustee or the termination of this Agreement. If any
suit, action, proceeding (including any governmental or regulatory
investigation), claim or demand shall be brought or asserted against any
Indemnified Party in respect of which indemnity may be sought pursuant to this
Section 8.2, such Indemnified Party shall promptly notify the Servicer in
writing, and the Servicer upon request of the Indemnified Party shall retain
counsel reasonably satisfactory to the Indemnified Party (or, with the consent
of the Servicer, counsel selected by the Indemnified Party acceptable to the
Servicer) to represent the Indemnified Party and any others the Servicer may
designate in such proceeding and shall pay the reasonable fees and expenses of
such counsel related to such proceeding. The Servicer shall not be liable for
any settlement of any claim or proceeding effected without its written consent,
but if settled with such consent or if there be a final judgment for the
plaintiff, the Servicer agrees to indemnify any Indemnified Party from and
against any loss or liability by reason of such settlement or judgment. The
Servicer shall not, without the prior written consent of the Indemnified Party,
effect any settlement of any pending or threatened proceeding in respect of
which any Indemnified Party is or could have been a party and indemnity could
have been sought hereunder by such Indemnified Party, unless such settlement
includes an unconditional release of such Indemnified Party from all liability
on claims that are the subject matter of such proceeding.
SECTION 8.3 Payments to Owner Trustee. Any amounts paid to the Owner
Trustee pursuant to this Article VIII shall be deemed not
29
to be a part of the Owner Trust Estate immediately after such payment.
ARTICLE IX
TERMINATION OF TRUST AGREEMENT
SECTION 9.1 Termination of Trust Agreement. (a) This Agreement (other than
Article VIII) and the Issuer shall terminate and be of no further force or
effect, (i) on the Distribution Date next succeeding the month which is six
months after 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, including the
payment to the Certificateholders of all amounts required to be paid to them
pursuant to this Agreement or (ii) at the time provided in Section 9.2;
provided, however, that in no event shall the Trust created by this Agreement
continue beyond the expiration of 21 years from the death of the last survivor
of the descendants of ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, the late ambassador to the Court of St.
James's, living on the date of this Agreement. The bankruptcy, liquidation,
dissolution, death or incapacity of any Certificateholder or Certificate Owner
(other than the General Partner as provided in Section 9.2.) shall not (x)
operate to terminate this Agreement or the Issuer, nor (y) entitle such
Certificateholder's or Certificate 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 Issuer or the Owner Trust
Estate nor (z) otherwise affect the rights, obligations and liabilities of
the parties hereto.
(b) Except as provided in clause (a), none of the General Partner, the
Depositor or any Certificateholder shall be entitled to revoke or terminate the
Trust.
(c) Notice of any termination of the Issuer, specifying the Distribution
Date upon which the Certificateholders shall surrender their Certificates to the
Owner Trustee or the Paying Agent for payment of the final distribution and
cancellation, shall be given by the Owner Trustee by letter to the
Certificateholders mailed within five Business Days of receipt of notice of such
termination from the Servicer given pursuant to Section 9.1(c) of the Sale and
Servicing Agreement, stating (i) the Distribution Date upon or with respect to
which final payment of the Certificates shall be made upon or with respect to
which final payment of the Certificates shall be made upon presentation and
surrender of the Certificates at the office of the Owner Trustee or 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
Certificates at the office of the Owner Trustee or the Paying Agent therein
specified. The Owner Trustee shall give such notice to the Certificate Registrar
(if other than the Owner
30
Trustee) and the Paying Agent at the time such notice is given to the
Certificateholders. Upon presentation and surrender of the Certificates, the
Owner Trustee or the Paying Agent shall cause to be distributed to the
Certificateholders amounts distributable on such Distribution Date pursuant to
Section 5.2.
If all of the Certificateholders shall not surrender their 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 Certificates for
cancellation and receive the final distribution with respect thereto. If within
one year after the second notice all the 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 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 Owner Trust Estate after
exhaustion of such remedies shall be distributed, subject to applicable escheat
laws, by the Owner Trustee to the Depositor.
(d) Any funds remaining in the Issuer after funds for final distribution
have been distributed or set aside for distribution shall be distributed by the
Owner Trustee 1% to the General Partner and 99% to the Depositor.
(e) Upon the winding up of the Issuer and its termination, the Owner
Trustee shall cause the Certificate of Trust to be canceled by filing a
certificate of cancellation with the Secretary of State in accordance with the
provisions of Section 3810 of the Business Trust Statute.
SECTION 9.2 Dissolution upon Bankruptcy of the General Partner. In the
event that an Insolvency Event shall occur with respect to the General Partner,
this Agreement shall be terminated in accordance with Section 9.1, 90 days after
the date of such Insolvency Event, unless, before the end of such 90-day period,
the Owner Trustee shall have received written instructions from the Noteholders
holding a majority of the Outstanding Amount of each of the Class A-1 Notes, the
Class A-2 Notes, the Class A-3 Notes and the Class A-4 Notes, the
Certificateholders holding a majority of the Certificate Balance (other than the
General Partner) and the holders of a majority of all interests in any Reserve
Account (other than the General Partner) to the effect that each such party
disapproves of the liquidation of the Receivables and termination of the Issuer.
Promptly after the occurrence of any Insolvency Event with respect to the
General Partner, (i) the General Partner shall give the Indenture Trustee and
the Owner Trustee written notice such Insolvency Event, (ii) the Owner Trustee
shall, upon the receipt of such written notice from the General Partner, give
prompt written notice to the Certificateholders of the occurrence of such event,
and (iii) the Indenture Trustee shall, upon receipt of written notice of such
Insolvency Event, give prompt written notice to the Noteholders of the
occurrence of such event: provided
31
that any failure to give a notice required by this sentence shall not prevent or
delay, in any manner, a termination of the Issuer pursuant to the first sentence
of this Section 9.2. Upon a termination pursuant to this Section, the Owner
Trustee shall promptly sell the assets of the Owner Trust Estate in a
commercially reasonable manner and on commercially reasonable terms. The net
proceeds of such a sale of the assets of the Issuer (after the costs and
expenses of the Owner Trustee of such sale) shall be treated as Collections
under the Sale and Servicing Agreement and shall be distributed in accordance
with Section 9.1(b) thereof.
ARTICLE X
SUCCESSOR OWNER TRUSTEES AND ADDITIONAL OWNER TRUSTEES
SECTION 10.1 Eligibility Requirements for Owner Trustee. The Owner Trustee
shall at all times be a corporation authorized to exercise corporate trust
powers; and having a combined capital and surplus of at least $100,000,000 and
subject to supervision or examination by Federal or state authorities. If such
corporation shall publish reports of condition at least annually, pursuant to
law or to the requirements of the aforesaid supervising or examining authority,
then for the purpose of this Section, the combined capital and surplus of such
corporation shall be deemed to be its combined capital and surplus as set forth
in its most recent report of condition so published. In case at any time the
Owner Trustee shall cease to be eligible in accordance with the provisions of
this Section, the Owner Trustee shall resign immediately in the manner and with
the effect specified in Section 10.2. In addition, at all times the Owner
Trustee or a co-trustee shall be a person that satisfies the requirements of
Section 3807(a) of the Business Trust Statute (the "Delaware Trustee").
SECTION 10.2 Resignation or Removal of Owner Trustee. The Owner Trustee
may at any time resign and be discharged from the trusts hereby created by
giving written notice thereof to the 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 10.1 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
32
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 of which shall be delivered to the successor Owner Trustee,
and payment of all fees owed to the outgoing Owner Trustee shall be made to the
outgoing Owner Trustee.
Any resignation or removal of the Owner Trustee and appointment of a
successor Owner Trustee pursuant to any of the provisions of this Section shall
not become effective until acceptance of appointment by the successor Owner
Trustee pursuant to Section 10.3 and payment of all fees and expenses owed to
the outgoing Owner Trustee. The Administrator shall provide notice of such
resignation or removal of the Owner Trustee to each of the Rating Agencies.
SECTION 10.3 Successor Owner Trustee. Any successor Owner Trustee
appointed pursuant to Section 10.2 shall execute, acknowledge and deliver to the
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 the 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 10.1.
Upon acceptance of appointment by a successor Owner Trustee pursuant to
this Section, the Administrator shall mail notice of the successor of such Owner
Trustee to all Certificateholders, the Trustee, the Noteholders and the Rating
Agencies. If the Administrator shall fail to mail such notice within 10 days
after acceptance of appointment by the successor Owner Trustee, the successor
Owner Trustee shall cause such notice to be mailed at the expense of the
Administrator.
SECTION 10.4 Merger or Consolidation of Owner Trustee. Any corporation
into which the Owner Trustee may be merged or converted or with which it may be
consolidated, or any corporation resulting
33
form any merger, conversion or consolidation to which the Owner Trustee shall be
a party, or any corporation succeeding to all or substantially all of the
corporate trust business of the Owner Trustee, shall be the successor of the
Owner Trustee hereunder, provided such corporation shall be eligible pursuant to
Section 10.1, without the execution or filing of any instrument or any further
act on the part of any of the parties hereto, anything herein to the contrary
notwithstanding; provided further that the Owner Trustee shall mail notice of
such merger or consolidation to the Rating Agencies.
SECTION 10.5 Appointment of Co-Trustee or Separate Trustee.
Notwithstanding any other provisions of this Agreement, at any time, for the
purpose of meeting any legal requirements of any jurisdiction in which any part
of the Owner Trust Estate or any Financed Vehicle may at the time be located,
the 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 Owner Trustee to act as co-trustee, jointly with the Owner
Trustee, or separate trustee or separate trustees, of all or any part of the
Owner Trust Estate, and to vest in such Person, in such capacity, such title to
the Issuer, 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. If the Delaware Trustee shall become incapable
of acting, resign or be removed, unless the Owner Trustee is qualified to act as
the Delaware Trustee, a successor co-trustee shall promptly be appointed in the
manner specified in this Section 10.5 to act as the Delaware Trustee. No
co-trustee or separate trustee under this Agreement shall be required to meet
the terms of eligibility as a successor trustee pursuant to Section 10.1 and no
notice of the appointment of any co-trustee or separate trustee shall be
required pursuant to Section 10.3.
Each separate trustee and co-trustee shall, to the extent permitted by
law, be appointed and act subject to the following provisions and conditions:
(i) all rights, powers, duties and obligations conferred or imposed
upon the Owner Trustee shall be conferred upon and exercised or performed
by the Owner Trustee and such separate trustee or co-trustee jointly (it
being understood that such separate trustee or co-trustee is not
authorized to act separately without the Owner Trustee joining in such
act), except to the extent that under any law of any jurisdiction in which
any particular act or acts are to be performed, the Owner Trustee shall be
incompetent or unqualified to perform such act or acts, in which event
such rights, powers, duties and obligations (including the holding of
title to the Issuer or any portion thereof in any such jurisdiction) shall
be exercised and performed singly by such
34
separate trustee or co-trustee, but solely at the direction of
the Owner Trustee;
(ii) no trustee under this Agreement shall be personally liable by
reason of any act or omission of any other trustee under this Agreement;
and
(iii) the 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 become incapable of acting, resign or be removed, all of its estates,
properties, rights, remedies and trusts shall vest in and be exercised by the
Owner Trustee, to the extent permitted by law, without the appointment of a new
or successor trustee.
ARTICLE XI
MISCELLANEOUS
SECTION 11.1 Supplements and Amendments. This Agreement may be amended by
the Depositor, the General Partner and the Owner Trustee, with prior written
notice to the Rating Agencies, without the consent of any of the Noteholders or
the Certificateholders, to cure any ambiguity or defect, 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 or the General Partner; provided that such action shall
not, as evidenced by an Opinion of Counsel, materially and adversely affect the
interests of any Noteholder or Certificateholder; provided, further, that the
Depositor shall deliver written notice of such amendments to each Rating Agency
prior to the execution of any such amendment.
35
Notwithstanding the foregoing, no amendment modifying the provisions of Section
5.2 shall become effective without satisfaction of the Rating Agency Condition.
This Agreement may also be amended from time to time by the Depositor, the
General Partner, and the Owner Trustee, with prior written notice to the Rating
Agencies, with the consent of the Holders of Notes evidencing not less than 51%
of the Outstanding Amount of the Notes and, to the extent affected thereby, the
consent of the Holders of Certificates evidencing not less than 51% 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 modifying
in any manner the rights of the Noteholders or the Certificateholders; provided
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 the 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.
Promptly after the execution of any amendment or consent, the Owner
Trustee shall furnish written notification of the substance of such amendment or
consent to each Certificateholder, the Trustee and each of the Rating Agencies.
It shall not be necessary for the consent of Certificateholders or the
Noteholders pursuant to this Section to approve the particular form of any
proposed amendment or consent, but it shall be sufficient if such consent shall
approve the substance thereof. The manner of obtaining such consents (and any
other consents of the Certificateholders provided for in this Agreement or in
any other Basic Document) and of evidencing the authorization of the execution
thereof by the 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 the
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 the 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 which affects the Owner Trustee's
own rights, duties or immunities under this Agreement or otherwise.
SECTION 11.2 No Legal Title to Owner Trust Estate in Certificateholders.
The Certificateholders shall not have legal title to any part of the Owner Trust
Estate. The Certificateholders shall be entitled to receive distributions with
respect to their undivided ownership interest therein only in
36
accordance with Articles V and IX. No transfer, by operation of law or
otherwise, of any right, title or interest of the Certificateholders to and in
their ownership 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 11.3 Limitations on Rights of Others. Except for Sections 2.7 and
2.10, the provisions of this Agreement are solely for the benefit of the Owner
Trustee, the Depositor, the General Partner, the Certificateholders and, to the
extent expressly provided herein, the Trustee and the Noteholders, and nothing
in this Agreement, whether express or implied, shall be construed to give to any
other Person any legal or equitable right, remedy or claim in the Owner Trust
Estate or under or in respect of this Agreement or any covenants, conditions or
provisions contained herein.
SECTION 11.4 Notices. (a) Unless otherwise expressly specified or
permitted by the terms hereof, all notices shall be in writing and shall be
deemed given upon receipt personally delivered, delivered by overnight courier
or mailed certified mail, return receipt requested and shall be deemed to have
been duly given upon receipt, if to the Owner Trustee, addressed to Wilmington
Trust Company, ▇▇▇▇▇▇ Square North, ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attn: Corporate Trust Administration; if to the Depositor,
addressed to, Chase Manhattan Bank USA, N.A., c/o Chase Automotive Finance, ▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attn: Financial Controller; if to
the General Partner, addressed to Chase Auto Funding Corporation, c/o Chase
Automotive Finance, ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attn:
Financial Controller; or, as to each party, at such other address as shall be
designated by such party in a written notice to each other party.
(b) Any notice required or permitted to be given to a Certificateholder
shall be given by first-class mail, postage prepaid, at the address of such
Holder as shown in the Certificate Register. Any notice so mailed within the
time prescribed in this Agreement shall be conclusively presumed to have been
duly given, regardless of whether the Certificateholder receives such notice.
SECTION 11.5 Severability. Any provision of this Agreement that is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.
SECTION 11.6 Separate Counterparts. This Agreement may be executed by the
parties hereto in separate counterparts, each of which when so executed and
delivered shall be an original, but all
37
such counterparts shall together constitute but one and the same instrument.
SECTION 11.7 Successors and Assigns. All covenants and agreements
contained herein shall be binding upon, and inure to the benefit of, the
Depositor, the General Partner, the Owner Trustee and its successors and each
Certificateholder and its successors and permitted assigns, all as herein
provided. Any request, notice, direction, consent, waiver or other instrument or
action by a Certificateholder shall bind the successors and assigns of such
Certificateholder.
SECTION 11.8 No Petition. The Owner Trustee (not in its individual
capacity but solely as the Owner Trustee), by entering into this Agreement, each
Certificateholder, by accepting a Certificate, and the Indenture Trustee and
each Noteholder by accepting the benefits of this Agreement, hereby covenants
and agrees that it will not at any time institute against the General Partner,
or join in any institution against the General Partner of, any bankruptcy,
reorganization, arrangement, insolvency or liquidation proceedings, or other
0proceedings under any United States Federal or state bankruptcy or similar law
in connection with any obligations relating to the Certificates, the Notes, this
Agreement or any of the Basic Documents.
SECTION 11.9 No Recourse. Each Certificateholder by accepting a
Certificate acknowledges that such Certificateholder's Certificates represent
equity interests in the Issuer only and do not represent interests in or
obligations of the Depositor, the Servicer, the General Partner, the Owner
Trustee, the Trustee or any Affiliate thereof, and no recourse may be had
against such parties or their assets, except as may be expressly set forth or
contemplated in this Agreement, the Certificates or the other Basic Documents.
SECTION 11.10 Headings. The headings of the various Articles and Sections
herein are for convenience of reference only and shall not define or limit any
of the terms or provisions hereof.
SECTION 11.11 GOVERNING LAW. THIS AGREEMENT SHALL BE CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF DELAWARE, WITHOUT REFERENCE TO ITS
CONFLICT OF LAW PROVISIONS, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE
PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
SECTION 11.12 Certificate Transfer Restrictions. (a) The Certificates may
not be acquired by or for the account of (i) an employee benefit plan (as
defined in Section 3(3) of the Employee Retirement Income Security Act of 1974,
as amended ("ERISA")) which is subject to the provisions of Title I of ERISA,
(ii) a plan (as defined in Section 4975(e)(1) of the Code other than a
governmental or church plan described in Section 4975(g)(2) or (3) of the Code),
or (iii) any entity whose underlying assets include "plan assets" by reason of
any such plan's investment in the entity (excluding any investment company that
is registered under the Investment
36
Company Act of 1940, as amended) (each, a "Benefit Plan"). By accepting and
holding a Certificate, the Holder thereof shall be deemed to have represented
and warranted that it is not a Benefit Plan, and that no assets of a Benefit
Plan were used to acquire the Certificate. The foregoing restrictions shall not
apply to acquisitions or holdings of Certificates with assets of the general
account of an insurance company, to the extent that the acquisition or holding,
respectively, of such Certificates (i) is and will be permissible under Section
401(c) of ERISA and final regulations thereunder or another exemption under
ERISA and (ii) does not and will not result in the contemplated operations of
the Trust being treated as non-exempt prohibited transactions.
(b) The Certificates may not be acquired by or for the account of an
individual or entity that is not a U.S. person as defined in Section 7701(a)(30)
of the Code and any transfer of a Certificate to a person that is not a U.S.
person shall be void. By accepting and holding a Certificate, the Holder shall
be deemed to have represented and warranted under penalties of perjury that
it (or, if it is acting as a nominee, the beneficial owner) is a U.S. person.
39
IN WITNESS WHEREOF, the parties hereto have caused this Trust Agreement to
be duly executed by their respective officers hereunto duly authorized as of the
day and year first above written.
WILMINGTON TRUST COMPANY,
as Owner Trustee
By: _______________________________
Name:
Title:
CHASE MANHATTAN BANK USA, N.A.,
as Depositor
By: _______________________________
Name:
Title:
CHASE AUTO FUNDING CORPORATION,
as General Partner
By: _______________________________
Name:
Title:
Acknowledged and accepted
with respect to Section 9.2
of this Trust Agreement
NORWEST BANK MINNESOTA,
NATIONAL ASSOCIATION,
not in its individual capacity, but
solely in its capacity as Indenture
Trustee
By:____________________________
Name:
Title:
EXHIBIT A
NUMBER $30,629,000
R- CUSIP NO. ▇▇▇▇▇▇▇▇▇
[THIS CERTIFICATE IS NOT TRANSFERRABLE]*
[UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE ISSUER OR
ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO
CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
THIS CERTIFICATE MAY NOT BE ACQUIRED BY OR FOR THE ACCOUNT OF (i) AN
EMPLOYEE BENEFIT PLAN (AS DEFINED IN SECTION 3(3) OF THE EMPLOYEE RETIREMENT
INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA")) WHICH IS SUBJECT TO THE
PROVISIONS OF TITLE I OF ERISA, (ii) A PLAN (AS DEFINED IN SECTION 4975(e)(1) OF
THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE "CODE") OTHER THAN A PLAN
DESCRIBED IN SECTION 4975(g)(2) OR (3) OF THE CODE), OR (iii) ANY ENTITY WHOSE
UNDERLYING ASSETS INCLUDE "PLAN ASSETS" BY REASON OF A PLAN'S INVESTMENT IN THE
ENTITY (EXCLUDING ANY INVESTMENT COMPANY THAT IS REGISTERED UNDER THE INVESTMENT
COMPANY ACT OF 1940, AS AMENDED). BY ACCEPTING AND HOLDING THIS CERTIFICATE, THE
HOLDER HEREOF AND THE CERTIFICATE OWNER SHALL EACH BE DEEMED TO HAVE REPRESENTED
AND WARRANTED THAT IT IS NOT SUCH A PLAN AND THAT NO ASSETS OF SUCH A PLAN WERE
USED TO ACQUIRE THIS CERTIFICATE. THE FOREGOING RESTRICTIONS SHALL NOT APPLY TO
ACQUISITIONS OR HOLDINGS OF CERTIFICATES WITH ASSETS OF THE GENERAL ACCOUNT OF
AN INSURANCE COMPANY, TO THE EXTENT THAT THE ACQUISITION OR HOLDING,
RESPECTIVELY, OF SUCH CERTIFICATES (i) IS AND WILL BE PERMISSIBLE UNDER SECTION
401(c) OF ERISA AND FINAL REGULATIONS THEREUNDER OR ANOTHER EXEMPTION UNDER
ERISA AND (ii) DOES NOT AND WILL NOT RESULT IN THE CONTEMPLATED OPERATIONS OF
THE TRUST BEING TREATED AS NONEXEMPT PROHIBITED TRANSACTIONS.
THE CERTIFICATES MAY NOT BE ACQUIRED BY OR FOR THE ACCOUNT OF AN
INDIVIDUAL OR ENTITY THAT IS NOT A U.S. PERSON AS DEFINED IN SECTION 7701(A)(30)
OF THE CODE. BY ACCEPTING AND HOLDING A CERTIFICATE, THE HOLDER SHALL BE DEEMED
TO HAVE REPRESENTED AND WARRANTED THAT IT (OR, IF IT IS ACTING AS A NOMINEE, THE
BENEFICIAL OWNER) IS A U.S. PERSON.
--------
* To be included in the General Partner's 1% Certificate.
Exhibit A, Page 1
THE PRINCIPAL OF THIS CERTIFICATE IS DISTRIBUTABLE IN INSTALLMENTS AS SET
FORTH IN THE TRUST AGREEMENT. ACCORDINGLY, THE OUTSTANDING PRINCIPAL OF THIS
CERTIFICATE AT ANY TIME MAY BE LESS THAN THE AMOUNT SHOWN ON THE FACE HEREOF.]
CHASE MANHATTAN AUTO OWNER TRUST 1996-C
6.250% ASSET BACKED CERTIFICATE
evidencing a beneficial ownership interest in certain distributions of the
Issuer, as defined below, the property of which includes a pool of retail
installment sales contracts or purchase money notes and security agreements
secured by new or used automobiles or light duty trucks and sold to the Issuer
by Chase Manhattan Bank USA, N.A., a national banking association.
(This Certificate does not represent an interest in or obligation of Chase
Manhattan Bank USA, N.A. or any of its Affiliates, except to the extent
described below.)
THIS CERTIFIES THAT ___________________________ is the registered owner of
___________________________ nonassessable, fully-paid, beneficial ownership
interest in certain distributions of Chase Manhattan Auto Owner Trust 1996-C
(the "Issuer") formed by Chase Manhattan Bank USA, N.A., a national banking
association (the "Depositor"). This Certificate has a Certificate Rate of 6.250%
per annum.
Exhibit A, Page 2
OWNER TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned Trust
Agreement.
________________________ _____________________________
or
as Owner Trustee as Owner Trustee
By:_____________________ By:__________________________
Authenticating Agent
Exhibit A, Page 3
Issuer was created pursuant to a Trust Agreement dated as of December 1,
1996 (the "Trust Agreement"), among the Depositor, Chase Auto Funding
Corporation, as General Partner (the "General Partner"), and Wilmington Trust
Company, as owner trustee (" the Owner Trustee"), a summary of certain of the
pertinent provisions of which is set forth below. To the extent not otherwise
defined herein, the capitalized terms used herein have the meanings assigned to
them in Section 1.1 of the Sale and Servicing Agreement between the Issuer and
Chase Manhattan Bank USA, N.A., as Seller and Servicer, dated as of December 1,
1996, as the same may be amended or supplemented from time to time (the "Sale
and Servicing Agreement").
This Certificate is one of the duly authorized Certificates of the Issuer
designated as "6.250% Asset Backed Certificates" (herein called the
"Certificates"). Also issued under the Indenture dated as of December 1, 1996,
between the Issuer and Norwest Bank Minnesota, National Association, as trustee
(the "Indenture"), are four classes of Notes designated as "Class A-1 5.489%
Asset Backed Notes" (the "Class A-1 Notes"), "Class A-2 5.750% Asset Backed
Notes" (the "Class A-2 Notes"), "Class A-3 5.950% Asset Backed Notes" (the
"Class A-3 Notes"), and "Class A-4 6.150% Asset Backed Notes" (the "Class A-4
Notes" and, together with the Class A-1 Notes, the Class A-2 Notes and the Class
A-3 Notes, the "Notes"). This Certificate is issued under and is subject to the
terms, provisions and conditions of the Trust Agreement, to which Trust
Agreement the holder of this Certificate by virtue of the acceptance hereof
assents and by which such holder is bound.
The holder of this Certificate acknowledges and agrees that its rights to
receive distributions in respect of this Certificate are subordinated to the
rights of the Noteholders as described in the Sale and Servicing Agreement, the
Indenture and the Trust Agreement, as applicable.
It is the intent of the Depositor, the General Partner and
Certificateholders that, for United States federal income tax purposes, the
Issuer will be treated as a partnership and the Depositor, the General Partner
and the Certificateholders will be treated as partners in that partnership. The
Certificateholders by acceptance of a Certificate, agree to treat, and to take
no action inconsistent with the treatment of, the Certificates for such tax
purposes as equity (i.e., partnership interests) in the Issuer.
Each Certificateholder, by its acceptance of a Certificate, covenants and
agrees that such Certificateholder will not at any time institute against the
General Partner, or join in any institution against the General Partner of, any
bankruptcy, reorganization, arrangement, insolvency or liquidation proceedings,
or other proceedings under any United States federal or state bankruptcy or
similar law in connection with any obligations relating to the Certificates, the
Notes, the Trust Agreement or any of the Basic Documents.
Exhibit A, Page 4
Each Certificateholder, by its acceptance of a Certificate or a beneficial
interest in a Certificate, acknowledges and agrees that the General Partner is
authorized to determine whether to cause the Issuer to make the election
contemplated in Internal Revenue Service Notice 95-14 to elect that the trust be
classified as a partnership for United States federal income tax purposes in the
event that the ability to make such election becomes available to the Issuer,
and acknowledges and agrees that the General Partner is authorized to direct the
Owner Trustee to take such acts or actions as may be required to effectuate such
election. Each Certificateholder, by its acceptance of a Certificate or a
beneficial interest in a Certificate, agrees to take such actions (and direct
the Owner Trustee to take such acts or actions) as the General Partner or the
Owner Trustee shall reasonably request in order to effectuate such election.
The Certificates do not represent an obligation of, or an interest in, the
Depositor, the Servicer, the General Partner, the Owner Trustee, the Trustee or
any Affiliates of any of them and no recourse may be had against such parties or
their assets, except as may be expressly set forth or contemplated herein or in
the Trust Agreement, the Indenture or the other Basic Documents.
This certificate may not be acquired by or for the account of (i) an
employee benefit plan (as defined in section 3(3) of the employee retirement
income security act of 1974, as amended ("ERISA")) which is subject to the
provisions of title i of erisa, (ii) a plan (as defined in Section 4975(e)(1) of
the Internal Revenue Code of 1986, as amended (the "Code") other than a plan
described in Section 4975(g)(2) or (3) of the code), or (iii) any entity whose
underlying assets include "plan assets" by reason of a plan's investment in the
entity (excluding any investment company that is registered under the Investment
Company Act of 1940, as amended). By accepting and holding this Certificate, the
holder hereof and the Certificate Owner shall each be deemed to have represented
and warranted that it is not such a plan and that no assets of such a plan were
used to acquire this Certificate. The foregoing restrictions shall not apply to
acquisitions or holdings of Certificates with assets of the general account of
an insurance company, to the extent that the acquisition or holding,
respectively, of such Certificates (i) is and will be permissible under Section
401(c) of ERISA and final regulations thereunder or another exemption under
ERISA and (ii) does not and will not result in the contemplated operations of
the Trust being treated as non-exempt prohibited transactions.
The Certificates may not be acquired by or for the account of an
individual or entity that is not a U.S. Person as defined in Section 7701(A)(30)
of the Code. By accepting and holding a Certificate, the Holder shall be deemed
to have represented and warranted that it (or, if it is acting as a Nominee, the
Beneficial Owner) is a U.S. Person.
Unless the certificate of authentication hereon shall have been executed
by an authorized officer of the Owner Trustee or the
Exhibit A, Page 5
Authentication Agent, by manual or facsimile signature, this Certificate shall
not entitle the holder hereof to any benefit under the Trust Agreement or the
Sale and Servicing Agreement or be valid for any purpose.
THIS CERTIFICATE SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE
STATE OF DELAWARE, WITHOUT REFERENCE TO ITS CONFLICT OF LAW PROVISIONS, AND THE
OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN
ACCORDANCE WITH SUCH LAWS.
IN WITNESS WHEREOF, the Owner Trustee, on behalf of Issuer and not in its
individual capacity, has caused this Certificate to be duly executed.
CHASE MANHATTAN AUTO
OWNER TRUST 1996-C
By:_______________________________
not in its individual
capacity, but solely as
Owner Trustee
Dated: By:_______________________________
Exhibit A, Page 6
ASSIGNMENT
FOR VALUE RECEIVED the undersigned hereby sells, assigns and
transfers unto
PLEASE INSERT SOCIAL SECURITY
OR OTHER IDENTIFYING NUMBER
OF ASSIGNEE
(Please print or type name and address, including postal zip code,
of assignee)
the within Certificate, and all rights thereunder, hereby
irrevocably constituting and appointing
___________________________________________ as Attorney to transfer said
Certificate on the books of the Certificate Registrar, with full power of
substitution in the premises.
Dated:
___________________________________*
Signature Guaranteed:
___________________________________*
--------
* NOTICE: The signature to this assignment must correspond with the name of
the registered owner as it appears on the face of the within Certificate
in every particular, without alteration, enlargement or any change
whatever. Such signature must be guaranteed by a member firm of the New
York Stock Exchange or a commercial bank or trust company.
Exhibit A, Page 7
EXHIBIT B
CERTIFICATE DEPOSITORY AGREEMENT
Exhibit C, Page 1
