EXHIBIT 99.2
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[ ] AUTO FINANCE TRUST 200_-_
FORM OF TRUST AGREEMENT
between
BOND SECURITIZATION, L.L.C.
and
_________________________________,
as Owner Trustee
Dated as of ___________ __, 200_
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TABLE OF CONTENTS
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Page
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ARTICLE I DEFINITIONS............................................................. 1
SECTION 1.1. Capitalized Terms.............................................. 1
SECTION 1.2. Other Interpretive Provisions.................................. 1
ARTICLE II ORGANIZATION........................................................... 1
SECTION 2.1. Name........................................................... 1
SECTION 2.2. Office......................................................... 2
SECTION 2.3. Purposes and Powers............................................ 2
SECTION 2.4. Appointment of Owner Trustee................................... 2
SECTION 2.5. Initial Capital Contribution of Trust Estate................... 3
SECTION 2.6. Declaration of Trust........................................... 3
SECTION 2.7. Organizational Expenses; Liabilities of the Holders............ 3
SECTION 2.8. Title to Issuer Property....................................... 3
SECTION 2.9. Situs of Issuer................................................ 3
SECTION 2.10. Representations and Warranties of Depositor.................... 4
SECTION 2.11. Federal Income Tax Allocations................................. 5
ARTICLE III CERTIFICATES AND TRANSFER OF INTERESTS................................. 6
SECTION 3.1. Initial Ownership.............................................. 6
SECTION 3.2. The Certificates............................................... 6
SECTION 3.3. Authentication of Certificates................................. 6
SECTION 3.4. Registration of Transfer and Exchange of Certificates.......... 7
SECTION 3.5. Mutilated, Destroyed, Lost or Stolen Certificates.............. 8
SECTION 3.6. Persons Deemed Certificateholders.............................. 8
SECTION 3.7. Access to List of Certificateholders' Names and Addresses...... 8
SECTION 3.8. Maintenance of Office or Agency................................ 9
SECTION 3.9. Appointment of Paying Agent.................................... 9
SECTION 3.10. [Reserved]..................................................... 10
SECTION 3.11. Book-Entry Certificates........................................ 10
SECTION 3.12. Notices to Clearing Agency..................................... 11
SECTION 3.13. Definitive Certificates........................................ 11
ARTICLE IV ACTIONS BY OWNER TRUSTEE............................................... 12
SECTION 4.1. Prior Notice to Owners with Respect to Certain Matters......... 12
SECTION 4.2. Action by Certificateholders with Respect to Certain
Matters........................................................ 12
SECTION 4.3. Action by Certificateholders with Respect to Bankruptcy........ 13
SECTION 4.4. Restrictions on Certificateholders' Power...................... 13
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SECTION 4.5. Majority Control............................................... 13
ARTICLE V APPLICATION OF TRUST FUNDS; CERTAIN DUTIES.............................. 13
SECTION 5.1. Establishment of Certificate Distribution Account.............. 13
SECTION 5.2. Application of Funds in Certificate Distribution Account....... 13
SECTION 5.3. Method of Payment.............................................. 14
SECTION 5.4. No Segregation of Monies; No Interest.......................... 15
SECTION 5.5. Accounting and Reports to the Noteholders,
Certificateholders, the Internal Revenue Service and Others.... 15
SECTION 5.6. Signature on Returns; Tax Matters Partner...................... 16
ARTICLE VI AUTHORITY AND DUTIES OF OWNER TRUSTEE.................................. 16
SECTION 6.1. General Authority.............................................. 16
SECTION 6.2. General Duties................................................. 16
SECTION 6.3. Action upon Instruction........................................ 16
SECTION 6.4. No Duties Except as Specified in this Agreement or
in Instructions................................................ 17
SECTION 6.5. No Action Except under Specified Documents or
Instructions................................................... 18
SECTION 6.6. Restrictions................................................... 18
ARTICLE VII CONCERNING OWNER TRUSTEE.............................................. 18
SECTION 7.1. Acceptance of Trusts and Duties................................ 18
SECTION 7.2. Furnishing of Documents........................................ 20
SECTION 7.3. Representations and Warranties................................. 20
SECTION 7.4. Reliance; Advice of Counsel.................................... 20
SECTION 7.5. Not Acting in Individual Capacity.............................. 21
SECTION 7.6. Owner Trustee Not Liable for Certificates or Receivables....... 21
SECTION 7.7. Owner Trustee May Own Certificates and Notes................... 22
ARTICLE VIII COMPENSATION OF OWNER TRUSTEE........................................ 22
SECTION 8.1. Owner Trustee's Fees and Expenses.............................. 22
SECTION 8.2. Indemnification................................................ 22
SECTION 8.3. Payments to Owner Trustee...................................... 23
ARTICLE IX TERMINATION OF TRUST AGREEMENT......................................... 23
SECTION 9.1. Termination of Trust Agreement................................. 23
ARTICLE X SUCCESSOR OWNER TRUSTEES AND ADDITIONAL OWNER TRUSTEES ................ 24
SECTION 10.1. Eligibility Requirements for Owner Trustee..................... 24
SECTION 10.2. Resignation or Removal of Owner Trustee........................ 25
SECTION 10.3. Successor Owner Trustee........................................ 25
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SECTION 10.4. Merger or Consolidation of Owner Trustee....................... 26
SECTION 10.5. Appointment of Co-Trustee or Separate Trustee.................. 26
ARTICLE XI MISCELLANEOUS.......................................................... 28
SECTION 11.1. Supplements and Amendments..................................... 28
SECTION 11.2. No Legal Title to Owner Trust Estate in Certificateholders..... 30
SECTION 11.3. Limitations on Rights of Others................................ 30
SECTION 11.4. Notices........................................................ 30
SECTION 11.5. Severability................................................... 31
SECTION 11.6. Separate Counterparts.......................................... 31
SECTION 11.7. Successors and Assigns......................................... 31
SECTION 11.8. No Petition.................................................... 31
SECTION 11.9. No Recourse.................................................... 31
SECTION 11.10. Headings....................................................... 31
SECTION 11.11. GOVERNING LAW.................................................. 31
SECTION 11.12. Certificate Transfer Restrictions.............................. 32
SECTION 11.13. Servicer....................................................... 32
SECTION 11.14. Sale and Servicing Agreement................................... 32
EXHIBITS
Exhibit A Form of Certificate
Exhibit B Form of Certificate Depository Agreement
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TRUST AGREEMENT dated as of __________ [ ], 200_ between Bond
Securitization, L.L.C., a Delaware limited liability company, as Depositor, and
_____________________, a [______________], as Owner Trustee.
ARTICLE I DEFINITIONS.
SECTION 1.1. Capitalized Terms. Capitalized terms are used in this
Agreement as defined in Appendix X to the Sale and Servicing Agreement among the
trust established by this Agreement, Bond Securitization, L.L.C., as Seller,
[ ], as Servicer, dated as of __________ [ ], 200_, as
the same may be amended and supplemented from time to time.
SECTION 1.2. Other Interpretive Provisions. All terms defined in this
Agreement shall have the defined meanings when used in any certificate or other
document delivered pursuant hereto unless otherwise defined therein. For
purposes of this Agreement and all such certificates and other documents, unless
the context otherwise requires: (a) accounting terms not otherwise defined in
this Agreement, and accounting terms partly defined in this Agreement to the
extent not defined, shall have the respective meanings given to them under
generally accepted accounting principles; (b) terms defined in Article 9 of the
UCC as in effect in the State of Delaware and not otherwise defined in this
Agreement are used as defined in that Article; (c) the words "hereof," "herein"
and "hereunder" and words of similar import refer to this Agreement as a whole
and not to any particular provision of this Agreement; (d) references to any
Article, Section, Schedule or Exhibit are references to Articles, Sections,
Schedules and Exhibits in or to this Agreement, and references to any paragraph,
subsection, clause or other subdivision within any Section or definition refer
to such paragraph, subsection, clause or other subdivision of such Section or
definition; (e) the term "including" means "including without limitation"; (f)
references to any law or regulation refer to that law or regulation as amended
from time to time and include any successor law or regulation; (g) references to
any Person include that Person's successors and assigns; and (h) headings are
for purposes of reference only and shall not otherwise affect the meaning or
interpretation of any provision hereof.
ARTICLE II ORGANIZATION.
SECTION 2.2. Name. The trust created hereby shall be known as "[ ]
Auto Finance Trust 200_-_", in which name Owner Trustee may conduct the business
of such trust, make and execute contracts and other instruments on behalf of
such trust and xxx and be sued.
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SECTION 2.2. Office. The office of Issuer shall be in care of Owner
Trustee at the Corporate Trust Office or at such other address as Owner Trustee
may designate by written notice to the Certificateholders and Depositor.
SECTION 2.3. Purposes and Powers. The purpose of Issuer is, and 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 and exchange the Notes
and the Certificates and to pay interest on and principal of the Notes and
distributions on 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 deposits to and withdrawals from the Reserve Account and to pay the
organizational, start-up and transactional expenses of Issuer;
(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 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.
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. Depositor hereby appoints
Owner Trustee as trustee of Issuer effective as of the date hereof, to have all
the rights, powers and duties set forth herein.
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SECTION 2.5. Initial Capital Contribution of Trust Estate. Depositor
hereby sells, assigns, transfers, conveys and sets over to Owner Trustee, as of
the date hereof, the sum of $1. Owner Trustee hereby acknowledges receipt in
trust from Depositor, as of the date hereof, of the foregoing contribution,
which shall constitute the initial Owner Trust Estate and shall be deposited in
the Certificate Distribution Account.
SECTION 2.6. Declaration of Trust. 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 Issuer under the Basic Documents. It is the intention of the
parties hereto that Issuer constitute a trust under the common law of the state
of _______ and that this Agreement constitute the governing instrument of such
business trust. It is the intention of the parties hereto that, solely for
income and franchise tax purposes, until the Certificates are held by other than
the Transferor, the Issuer will be disregarded as an entity separate from its
Owner and the Notes being debt of the Transferor. At such time that the
Certificates are held by more than one person, it is the intention of the
parties hereto that, solely for income and franchise tax purposes, the Issuer
shall be treated as a partnership, with the assets of the partnership being the
Receivables and other assets held by the Issuer, the partners of the partnership
being the Certificateholders, and the Notes being debt of the partnership. The
parties agree that, unless otherwise required by appropriate tax authorities,
until the Certificates are held by more than one person the Issuer will not file
or cause to be filed annual or other necessary returns, reports and other forms
consistent with the characterization of the Issuer as an entity not separate
from its Owner.
SECTION 2.7. Organizational Expenses; Liabilities of the Holders. (a)
Administrator shall pay organizational expenses of Issuer as they may arise or
shall, upon the request of Owner Trustee, promptly reimburse Owner Trustee for
any such expenses paid by Owner Trustee.
(b) No Holder or Owner shall have any personal liability for any
liability or obligation of the Trust.
SECTION 2.8. Title to Issuer Property. Legal title to all the Owner Trust
Estate shall be vested at all times in 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 title shall be
deemed to be vested in Owner Trustee, a co-trustee and/or a separate trustee, as
the case may be.
SECTION 2.9. Situs of Issuer. Issuer will be located and administered in
the State of ________. All bank accounts maintained by Owner Trustee on behalf
of Issuer shall be located in the State of _______ or the State of New York.
Payments
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will be received by Issuer only in ________ or New York, and payments will be
made by Issuer only from _________ or New York. The only office of Issuer will
be at the Corporate Trust Office in __________.
SECTION 2.10. [Reserved].
SECTION 2.11. Federal Income Tax Allocations. If Certificates are held by
more than one person,
(a) amounts paid to Certificateholders pursuant to Section 5.2(a)(i)
shall be treated as "guaranteed payments" within the meaning of Section
707(c) of the Code;
(b) to the extent that the characterization provided for in paragraph
(a) of this Section is not respected, gross ordinary income of Issuer for
such month as determined for federal income tax purposes shall be allocated
among the Certificateholders as of the first Record Date following the end
of such month, in proportion to their ownership of principal amount of the
Certificates on such date, in an amount up to the sum of (i) the
Certificateholders' Monthly Interest Distributable Amount for such month,
(ii) interest on the excess, if any, of the Certificateholders' Interest
Distributable Amount for the preceding Distribution Date over the amount in
respect of interest at the Certificate Rate that is actually deposited in
the Certificate Distribution Account on such preceding Distribution Date,
to the extent permitted by law, at the Certificate Rate from such preceding
Distribution Date through the current Distribution Date, and (iii) the
portion of the market discount on the Receivables accrued during such month
that is allocable to the excess of the initial aggregate principal amount
of the Certificates over their initial aggregate issue price; and
(c) thereafter all remaining net income of Issuer for such month as
determined for federal income tax purposes (and each item of income, gain,
credit, loss or deduction entering into the computation thereof) shall be
allocated to Transferor, to the extent thereof;
If the gross ordinary income of Issuer for any month is insufficient for the
allocations described in clause (b), subsequent gross ordinary income shall
first be allocated to make up such shortfall before being allocated as provided
in clause (c). Net losses of Issuer, if any, for any month as determined for
Federal income tax purposes (and each item of income, gain, loss, credit and
deduction entering into the computation thereof) shall be allocated to
Transferor to the extent Transferor is reasonably expected as determined by
Servicer to bear the economic burden of such net losses, then net losses shall
be allocated among the Certificateholders as of the first Record
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Date following the end of such month in proportion to their ownership of
principal amount of Certificates on such Record Date until the principal balance
of the Certificates is reduced to zero. Transferor is authorized to modify the
allocations in this paragraph if necessary or appropriate, in its sole
discretion, for the allocations to fairly reflect the economic income, gain or
loss to Transferor, the Certificateholders, or as otherwise required by the
Code. Notwithstanding anything provided in this Section 2.11, if the
Certificates are held solely by the Transferor, the application of this Section
2.11 shall be disregarded.
ARTICLE III CERTIFICATES AND TRANSFER OF INTERESTS.
SECTION 3.1. Initial Ownership. Upon the formation of Issuer by the
contribution by Depositor pursuant to Section 2.5 and until the issuance of the
Certificates to the Transferor, Depositor shall be the sole beneficiary 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.
The Certificates shall be executed on behalf of Issuer by manual or facsimile
signature of an authorized officer of 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 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. 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. Authentication of Certificates. Concurrently with the
initial sale of the Receivables to Issuer pursuant to the Sale and Servicing
Agreement, Owner Trustee shall cause the Certificates in an aggregate principal
amount equal to the initial Certificate Balance to be executed on behalf of
Issuer, authenticated and delivered to or upon the written order of Depositor,
signed by its chairman of the board, its president, its chief financial officer,
its chief accounting officer, any vice president, its secretary, any assistant
secretary, its treasurer or any assistant treasurer, without further corporate
action by Depositor, in authorized denominations. No Certificate shall entitle
its Holder to any benefit under this Agreement, or be valid for any purpose,
unless there shall appear on such Certificate a certificate of authentication
substantially in the form set forth in Exhibit A, executed by Owner Trustee or
_________________, as Owner Trustee's authentication agent, by manual
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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.
SECTION 3.4. Registration of Transfer and Exchange of Certificates.
Certificate Registrar shall keep or cause to be kept, at the office or agency
maintained pursuant to Section 3.8, a Certificate Register in which, subject to
such reasonable regulations as it may prescribe, Owner Trustee shall provide for
the registration of Certificates and of transfers and exchanges of Certificates
as herein provided. ______________________ shall be the initial Certificate
Registrar.
Upon surrender for registration of transfer of any Certificate at the
office or agency maintained pursuant to Section 3.8, Owner Trustee shall
execute, authenticate and deliver (or shall cause ___________________ 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 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.
Every Certificate presented or surrendered for registration of transfer or
exchange shall be accompanied by a written instrument of transfer in form
satisfactory to Owner Trustee and Certificate Registrar duly executed by the
Certificateholder or his attorney duly authorized in writing, with such
signature guaranteed by a member firm of the New York Stock Exchange, a
commercial bank or trust company or an "eligible guarantor institution" with
membership or participation in STAMP or such other "signature guarantee program"
as may be determined by Certificate Registrar in addition to, or substitution
for, STAMP, all in accordance with the Exchange Act. Each Certificate
surrendered for registration of transfer or exchange shall be canceled and
subsequently disposed of by 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 Owner Trustee or 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.
The preceding provisions of this Section 3.4 notwithstanding, Owner Trustee
shall not make and the Certificate Registrar need not register any transfer or
exchange of Certificates for a period of fifteen (15) days preceding any
Distribution Date for any payment with respect to the Certificates.
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SECTION 3.5. Mutilated, Destroyed, Lost or Stolen Certificates. If (a) any
mutilated Certificate shall be surrendered to Certificate Registrar, or if
Certificate Registrar shall receive evidence to its satisfaction of the
destruction, loss or theft of any Certificate and (b) there shall be delivered
to Certificate Registrar and 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, Owner
Trustee on behalf of Issuer shall execute and Owner Trustee, or
_____________________, as Owner Trustee's authenticating agent, shall
authenticate and deliver, in exchange for or in lieu of any such mutilated,
destroyed, lost or stolen Certificate, a new Certificate of like class, tenor
and denomination. In connection with the issuance of any new Certificate under
this Section, Owner Trustee or 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, as if originally issued, whether or not the lost, stolen or destroyed
Certificate shall be found at any time.
SECTION 3.6. Persons Deemed Certificateholders. Every Person by virtue of
becoming a Certificateholder or Owner in accordance with this Agreement shall be
deemed to be bound by the terms of this Agreement. Prior to due presentation of
a Certificate for registration of transfer, Owner Trustee, Certificate Registrar
or any agent of Owner Trustee or 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 none of Owner
Trustee, Certificate Registrar or any agent of Owner Trustee or Certificate
Registrar shall be bound by any notice to the contrary.
SECTION 3.7. Access to List of Certificateholders' Names and Addresses.
Owner Trustee shall furnish or cause to be furnished to Servicer, Depositor or
Indenture Trustee, within 15 days after receipt by Owner Trustee of a request
therefor from Servicer, Depositor or Indenture Trustee in writing, a list, in
such form as Servicer, Depositor or Indenture Trustee may reasonably require, of
the names and addresses of the Certificateholders as of the most recent Record
Date. 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 Owner Trustee, and such application states that the applicants desire
to communicate with other Certificateholders with respect to their rights under
this Agreement or under the Certificates and such application is accompanied by
a copy of the communication that such applicants propose to transmit, then Owner
Trustee shall, within five Business Days after the receipt of such application,
afford such applicants access during normal business hours to the current list
of Certificateholders. Each Holder, by receiving and holding a Certificate,
shall be deemed to have agreed not to hold
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Depositor, Certificate Registrar or 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. Owner Trustee shall maintain
in the Borough of Manhattan, The City of New York, an office or offices or
agency or agencies where Certificates may be surrendered for registration of
transfer or exchange and where notices and demands to or upon Owner Trustee in
respect of the Certificates and the Basic Documents may be served. Owner Trustee
initially designates ___________________, _____________, New York, New York
_____, as its principal corporate trust office for such purposes. Owner Trustee
shall give prompt written notice to Depositor 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. Paying Agent shall make
distributions to Certificateholders from the Certificate Distribution Account
pursuant to Section 5.2 and shall report the amounts of such distributions to
Owner Trustee. Any Paying Agent shall have the revocable power to withdraw funds
from the Certificate Distribution Account for the purpose of making the
distributions referred to above. Owner Trustee may revoke such power and remove
Paying Agent if Owner Trustee determines in its sole discretion that Paying
Agent shall have failed to perform its obligations under this Agreement in any
material respect. Paying Agent shall initially be ________________________, and
any co-paying agent chosen by ________________________, and acceptable to Owner
Trustee. Paying Agent shall be permitted to resign upon 30 days' written notice
to Owner Trustee and Servicer. In the event that ________________________ shall
no longer be Paying Agent, Owner Trustee shall appoint a successor to act as
Paying Agent (which shall be a bank or trust company). Owner Trustee shall cause
such successor Paying Agent or any additional Paying Agent appointed by Owner
Trustee to execute and deliver to Owner Trustee an instrument in which such
successor Paying Agent or additional Paying Agent shall agree with 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. Paying Agent shall return all
unclaimed funds to Owner Trustee and upon removal of a Paying Agent such Paying
Agent shall also return all funds in its possession to Owner Trustee. The
provisions of Sections 7.1, 7.3, 7.4 and 8.1 shall apply to Owner Trustee also
in its role as Paying Agent, for so long as 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 Paying Agent shall include any co-
paying agent unless the context requires otherwise.
SECTION 3.10. [Reserved]
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SECTION 3.11. Book-Entry Certificates. 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
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 will receive a Definitive
Certificate representing such beneficial owner's interest in such Certificate,
except as provided in Section 3.13. Unless and until Definitive Certificates
have been issued to beneficial owners pursuant to Section 3.13:
(a) the provisions of this Section shall be in full force and effect;
(b) Certificate Registrar, each Paying Agent and Owner Trustee shall
be entitled to deal with the Clearing Agency 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 Owners of Book-Entry Certificates) as the
sole Holder of Book-Entry Certificates and shall have no obligations to
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 Owners of the Book-Entry Certificates shall be
exercised only through the Clearing Agency and shall be limited to those
established by law and agreements between such Owners and the Clearing
Agency and/or Clearing Agency Participants or Persons acting through
Clearing Agency Participants. Pursuant to the Certificate Depository
Agreement, unless and until Definitive Certificates are issued pursuant to
Section 3.13, 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 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 Owners and/or Clearing Agency
Participants or Persons acting through Clearing Agency Participants owning
or
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representing, respectively, such required percentage of the beneficial
interest in the Book-Entry Certificates and has delivered such instructions
to Owner Trustee.
SECTION 3.12. Notices to Clearing Agency. Whenever a notice or other
communication to Owners is required under this Agreement, unless and until
Definitive Certificates shall have been issued to Owners pursuant to Section
3.13, Owner Trustee and each Paying Agent shall give all such notices and
communications specified herein to be given to Owners to the Clearing Agency,
and shall have no obligations to Owners.
SECTION 3.13. Definitive Certificates. If Servicer advises 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 Servicer is
unable to locate a qualified successor, Servicer at its option advises Owner
Trustee in writing that it elects to terminate the book-entry system through the
Clearing Agency or after the occurrence of an Event of Default, Owners of
Certificates representing beneficial interests aggregating at least a majority
of the Certificate Balance advise the Clearing Agency and Owner Trustee in
writing that the continuation of a book-entry system through the Clearing Agency
is no longer in the best interest of Owners of Certificates, then the Clearing
Agency shall notify all Owners and Owner Trustee of the occurrence of any such
event and of the availability of the Definitive Certificates to Owners
requesting the same. Upon surrender to Owner Trustee of the typewritten
Certificate or Certificates representing the Book Entry Certificates by the
Clearing Agency, accompanied by registration instructions, Owner Trustee shall
execute and authenticate, or cause to be authenticated, the Definitive
Certificates in accordance with the instructions of the Clearing Agency. Neither
Certificate Registrar nor 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, Owner Trustee and each 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
manner as is reasonably acceptable to Owner Trustee, as evidenced by its
execution thereof.
ARTICLE IV ACTIONS BY OWNER TRUSTEE.
SECTION 4.1. Prior Notice to Owners with Respect to Certain Matters. With
respect to the following matters, Owner Trustee shall not take action unless at
least 30 days before the taking of such action, Owner Trustee shall have
notified the Certificateholders in writing of the proposed action and the
Certificateholders shall not have notified Owner Trustee in writing prior to the
30th day after such notice is
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10
given that such Certificateholders have withheld consent or provided alternative
direction:
(a) the initiation of any material claim or lawsuit by 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 Issuer (except with respect to the aforementioned
claims or lawsuits brought in connection with the collection of the
Receivables);
(b) the amendment of the Indenture by a supplemental indenture in
circumstances where the consent of any Noteholder is required;
(c) the amendment of the Indenture by a supplemental indenture in
circumstances where the consent of any Noteholder is not required and such
amendment materially adversely affects the interest of the
Certificateholders;
(d) the amendment, change or modification of the Sale and Servicing
Agreement or the Administration Agreement, except to cure any ambiguity or
defect or to amend or supplement any provision in a manner that would not
materially adversely affect the interests of the Certificateholders; or
(e) the appointment pursuant to the Indenture of a successor
Indenture Trustee or the consent to the assignment by the Note Registrar,
Paying Agent or Indenture Trustee or Certificate Registrar of its
obligations under the Indenture or this Agreement, as applicable.
Owner Trustee shall notify the Certificateholders in writing of any appointment
of a successor Paying Agent or Certificate Registrar within five Business Days
thereof.
SECTION 4.2. Action by Certificateholders with Respect to Certain Matters.
Owner Trustee shall not have the power, except upon the direction of the
Certificateholders, to (a) remove Servicer under the Sale and Servicing
Agreement pursuant to Section 8.1 thereof, (b) except as expressly provided in
the Basic Documents, sell the Receivables after the termination of the
Indenture, (c) remove the Administrator under the Administration Agreement
pursuant to Section 9 thereof or (d) appoint a successor Administrator pursuant
to Section 9 of the Administration Agreement. Owner Trustee shall take the
actions referred to in the preceding sentence only upon written instructions
signed by the Certificateholders.
SECTION 4.3. Action by Certificateholders with Respect to Bankruptcy. Owner
Trustee shall not have the power to commence a voluntary proceeding in
bankruptcy relating to Issuer until the Outstanding Amount of all the Notes has
been
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11
reduced to zero and without the unanimous prior approval of all
Certificateholders and the delivery to Owner Trustee by each such
Certificateholder of a certificate certifying that such Certificateholder
reasonably believes that Issuer is insolvent.
SECTION 4.4. Restrictions on Certificateholders' Power. The
Certificateholders shall not direct Owner Trustee to take or refrain from taking
any action if such action or inaction would be contrary to any obligation of
Issuer or Owner Trustee under this Agreement or any of the Basic Documents or
would be contrary to Section 2.3 nor shall 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 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. Owner
Trustee, for the benefit of the Certificateholders, shall establish and maintain
in the name of 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 Owner Trustee for the benefit of the Certificateholders.
SECTION 5.2. Application of Funds in Certificate Distribution Account. On
each Distribution Date, Owner Trustee will, or will cause Paying Agent to, based
on the information contained in Servicer's Report delivered on the related
Determination Date pursuant to Section 4.9 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 the Sale and
Servicing Agreement on such Distribution Date in the following order of
priority:
(i) first, to the Certificateholders, on a pro rata basis, an
amount equal to the Certificateholders' Interest Distributable Amount;
and
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(ii) second, to the Certificateholders, on a pro rata basis, an
amount equal to the Certificateholders' Principal Distributable
Amount.
(b) On each Distribution Date, Owner Trustee shall send, or cause to
be sent, to each Certificateholder the statement provided to Owner Trustee
by Servicer pursuant to Section 5.6 of the Sale and Servicing Agreement on
such Distribution Date.
(c) In the event that any withholding tax is imposed on the Trust's
payment (or allocations of income) to a Certificateholder, such tax shall
reduce the amount otherwise distributable to the Certificateholder in
accordance with this Section. 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 Issuer (but such authorization shall not prevent 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 Issuer and remitted to the
appropriate taxing authority. If there is a possibility that withholding
tax is payable with respect to a distribution (such as a distribution to a
non-United States Certificateholder), Owner Trustee may in its sole
discretion withhold such amounts in accordance with this clause (c). In the
event that an Owner wishes to apply for a refund of any such withholding
tax, Owner Trustee shall reasonably cooperate with such Certificateholder
in making such claim so long as such Certificateholder agrees to reimburse
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 by wire
transfer, in 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 Certificate Registrar appropriate
written instructions at least five Business Days prior to such Distribution Date
and such Holder's Certificates in the aggregate evidence an amount of not less
than $1,000,000 or such Certificateholder is the Transferor, or an Affiliate
thereof, or, if not, 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 3.13, 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.),
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distributions will be made by wire transfer in immediately available funds to
the account designated by such nominee. Notwithstanding the foregoing, the final
distribution in respect of any Certificate (whether on the Final Scheduled
Distribution Date or otherwise) will be payable only upon presentation and
surrender of such Certificate at the office or agency maintained for that
purpose by Owner Trustee pursuant to Section 3.8.
SECTION 5.4. No Segregation of Monies; No Interest. Subject to Sections 5.1
and 5.2, monies received by Owner Trustee or any Paying Agent hereunder need not
be segregated in any manner except to the extent required by law or the
Indenture or the Sale and Servicing Agreement and may be deposited under such
general conditions as may be prescribed by law, and neither 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. Owner Trustee shall (a) maintain (or
cause to be maintained) the books of 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 and file such tax returns relating to Issuer (including a
partnership information return, Form 1065, if applicable), 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 Issuer's characterization as a partnership for federal income tax
purposes, (d) cause such tax returns to be signed in the manner required by law
and (e) 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. Owner Trustee shall cooperate with the Transferor in making
all elections pursuant to this Section as directed in writing by the Transferor.
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 and
shall elect under Section 171 of the Code to amortize any bond premium with
respect to the Receivables. Owner Trustee shall not make the election provided
under Section 754 of the Code.
SECTION 5.6. Signature on Returns; Tax Matters Partner. Notwithstanding the
provisions of Section 5.5, Transferor shall sign on behalf of Issuer the tax
returns of Issuer, unless applicable law requires Owner Trustee to sign such
documents, in which case such documents shall be signed by Owner Trustee at the
written direction of Transferor.
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(b) Transferor shall be the "tax matters partner" of Issuer pursuant
to Section 6231(a)(7)(A) of the Code and applicable Treasury Regulations.
ARTICLE VI AUTHORITY AND DUTIES OF OWNER TRUSTEE.
SECTION 6.1. General Authority. Owner Trustee is authorized and directed to
execute and deliver the Basic Documents to which 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 Issuer is named as a party and any amendment
thereto, in each case, in such form as Administrator shall approve, as evidenced
conclusively by Owner Trustee's execution thereof, and on behalf of Issuer at
the written direction of Administrator, to direct Indenture Trustee to
authenticate and deliver Class A-1 Notes in the aggregate principal amount of
$____________, and Class A-2 Notes in the aggregate principal amount of
$____________. In addition to the foregoing, Owner Trustee is authorized, but
shall not be obligated, to take all actions required of Issuer pursuant to the
Basic Documents. Owner Trustee is further authorized from time to time to take
such action as Servicer or Administrator recommends or directs in writing with
respect to the Basic Documents, except to the extent that this Agreement
expressly requires the consent of Certificateholders for such action.
SECTION 6.2. General Duties. It shall be the duty of 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
Issuer in the interest of Owners, subject to the Basic Documents and in
accordance with the provisions of this Agreement. Notwithstanding the foregoing,
Owner Trustee shall be deemed to have discharged its duties and responsibilities
hereunder and under the Basic Documents to the extent Administrator has agreed
in the Administration Agreement to perform any act or to discharge any duty of
Owner Trustee or Issuer hereunder or under any Basic Document, and Owner Trustee
shall not be liable for the default or failure of Administrator to carry out its
obligations under the Administration Agreement. Except as expressly provided in
the Basic Documents, the Owner Trustee shall have no obligation to administer,
service or collect the Receivables or to maintain, monitor or otherwise
supervise the administration, servicing or collection of the Receivables.
SECTION 6.3. Action upon Instruction. Subject to Article IV, the
Certificateholders may, by written instruction, direct Owner Trustee in the
management of Issuer. Such direction may be exercised at any time by written
instruction of the Certificateholders pursuant to Article IV.
(b) Owner Trustee shall not be required to take any action hereunder
or under any Basic Document if Owner Trustee shall have reasonably
determined or been advised by counsel that such action is likely to result
in
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15
liability on the part of Owner Trustee or is contrary to the terms hereof
or of any Basic Document or is otherwise contrary to law and a copy of such
opinion has been provided to Seller and Servicer.
(c) Whenever Owner Trustee is unable to decide between alternative
courses of action permitted or required by the terms of this Agreement or
any Basic Document or is unsure as to the application of any provision of
this Agreement or any Basic Document or any such provision is ambiguous as
to its application, or is, or appears to be, in conflict with any other
applicable provision, or in the event that this Agreement permits any
determination by Owner Trustee or is silent or is incomplete as to the
course of action that Owner Trustee is required to take with respect to a
particular set of facts, 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 or application of such provision, and to the extent Owner Trustee
acts or refrains from acting in good faith in accordance with any written
instruction of the Certificateholders received, Owner Trustee shall not be
liable on account of such action or inaction to any Person. If Owner
Trustee shall not have received appropriate instruction within ten days of
such notice (or within such shorter period of time as reasonably may be
specified in such notice or may be necessary under the circumstances) it
may, but shall be under no duty to, take or refrain from taking such
action, not inconsistent with this Agreement or the Basic Documents, as it
shall deem to be in the best interests of the Certificateholders, and 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. 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 Owner Trustee is a party, except as expressly provided by the terms of
this Agreement or in any document or written instruction received by Owner
Trustee pursuant to Section 6.3; and no implied duties or obligations shall be
read into this Agreement or any Basic Document against Owner Trustee. 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 Issuer or to record this Agreement or
any Basic Document. 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, Owner Trustee that are not related to the ownership or the
administration of the Owner Trust Estate.
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SECTION 6.5. No Action Except under Specified Documents or Instructions.
Owner Trustee shall not manage, control, use, sell, dispose of or otherwise deal
with any part of the Owner Trust Estate except (i) in accordance with the powers
granted to and the authority conferred upon Owner Trustee pursuant to this
Agreement, (ii) in accordance with the Basic Documents and (iii) in accordance
with any document or instruction delivered to Owner Trustee pursuant to Section
6.3.
SECTION 6.6. Restrictions. Owner Trustee shall not take any action (a) that
is inconsistent with the purposes of Issuer set forth in Section 2.3 or (b)
that, to the actual knowledge of Owner Trustee, would (i) affect the treatment
of the Notes as indebtedness for federal income, state and local income and
franchise tax purposes, (ii) be deemed to cause a taxable exchange of the Notes
for federal income or state income or franchise tax purposes or (iii) cause
Issuer or any portion thereof to be treated as an association or publicly traded
partnership taxable as a corporation for federal income, state and local income
or franchise tax purposes. The Certificateholders shall not direct Owner Trustee
to take action that would violate the provisions of this Section.
ARTICLE VII CONCERNING OWNER TRUSTEE.
SECTION 7.1. Acceptance of Trusts and Duties. 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. Owner Trustee also agrees
to disburse all moneys actually received by it constituting part of the Owner
Trust Estate upon the terms of the Basic Documents and this Agreement. Owner
Trustee shall not be answerable or accountable hereunder or under any Basic
Document under any circumstances, except (i) for its own willful misconduct, bad
faith or negligence or (ii) in the case of the inaccuracy of any representation
or warranty contained in Section 7.3 expressly made by Owner Trustee. In
particular, but not by way of limitation (and subject to the exceptions set
forth in the preceding sentence):
(a) Owner Trustee shall not be liable for any error of judgment made
by a Responsible Officer of Owner Trustee;
(b) Owner Trustee shall not be liable with respect to any action
taken or omitted to be taken by it in accordance with the instructions of
the Transferor, Depositor, Servicer, Administrator or any
Certificateholder;
(c) no provision of this Agreement or any Basic Document shall
require Owner Trustee to expend or risk funds or otherwise incur any
financial liability in the performance of any of its rights or powers
hereunder or under any Basic Document if Owner Trustee shall have
reasonable
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17
grounds for believing that repayment of such funds or adequate indemnity
against such risk or liability is not reasonably assured or provided to it;
(d) under no circumstances shall 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 or amounts
distributable on the Certificates;
(e) Owner Trustee shall not be responsible for or in respect of the
validity or sufficiency of this Agreement or for the due execution hereof
by 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, and 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;
(f) Owner Trustee shall not be liable for the default or misconduct
of Indenture Trustee, Servicer, Custodian or Administrator under any of the
Basic Documents or otherwise and Owner Trustee shall have no obligation or
liability to perform the obligations of Issuer under this Agreement or the
Basic Documents that are required to be performed by Indenture Trustee
under the Indenture, Servicer or Custodian under the Sale and Servicing
Agreement or Administrator under the Administration Agreement; and
(g) Owner Trustee shall be under no obligation to exercise any of the
rights or powers vested in it by this Agreement, or to institute, conduct
or defend any litigation under this Agreement or otherwise or in relation
to this Agreement or any Basic Document, at the request, order or direction
of any of the Certificateholders, unless such Certificateholders have
offered to Owner Trustee security or indemnity satisfactory to it against
the costs, expenses and liabilities that may be incurred by Owner Trustee
therein or thereby. The right of Owner Trustee to perform any discretionary
act enumerated in this Agreement or in any Basic Document shall not be
construed as a duty, and Owner Trustee shall not be answerable for other
than its negligence, bad faith or willful misconduct in the performance of
any such act.
SECTION 7.2. Furnishing of Documents. Owner Trustee shall furnish to the
Certificateholders promptly upon receipt of a written request therefor,
duplicates or copies of all reports, notices, requests, demands, certificates,
financial statements and any other instruments furnished to Owner Trustee under
the Basic Documents.
TRUST AGREEMENT
18
SECTION 7.3. Representations and Warranties. Owner Trustee hereby
represents and warrants to Depositor, for the benefit of the Certificateholders,
that:
(a) It is a [national] banking corporation [duly organized and
validly existing in good standing under the laws of the State of ________]
and having an office within the State of _________. It has all requisite
corporate power and authority to execute, deliver and perform its
obligations under this Agreement.
(b) It has taken all corporate action necessary to authorize the
execution and delivery by it of this Agreement, and this Agreement will be
executed and delivered by one of its officers who is duly authorized to
execute and deliver this Agreement on its behalf.
(c) This Agreement constitutes a legal, valid and binding obligation
of Owner Trustee, enforceable against Owner Trustee in accordance with its
respective terms, subject, as to enforceability, to applicable bankruptcy,
insolvency, reorganization, conservatorship, receivership, liquidation and
other similar laws affecting enforcement of the rights of creditors of
banks generally and to equitable limitations on the availability of
specific remedies.
(d) 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 Owner Trustee or any judgment or order binding
on it, or constitute any default under its charter documents or by-laws or
any indenture, mortgage, contract, agreement or instrument to which it is a
party or by which any of its properties may be bound.
SECTION 7.4. Reliance; Advice of Counsel. Owner Trustee shall incur no
liability to anyone in acting upon any signature, instrument, notice,
resolution, request, consent, order, certificate, report, opinion, bond or other
document or paper believed by it to be genuine and believed by it to be signed
by the proper party or parties. 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,
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 Owner Trustee for any action
taken or omitted to be taken by it in good faith in reliance thereon.
TRUST AGREEMENT
19
(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, Owner Trustee (i) may act directly or through its agents
or attorneys pursuant to agreements entered into with any of them, but
Owner Trustee shall not be liable for the conduct or misconduct of such
agents or attorneys selected with reasonable 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. 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,________________________
acts solely as Owner Trustee hereunder and not in its individual capacity and
all Persons having any claim against Owner Trustee by reason of the transactions
contemplated by this Agreement or any Basic Document shall look only to the
Owner Trust Estate for payment or satisfaction thereof.
SECTION 7.6. Owner Trustee Not Liable for Certificates or Receivables. The
recitals contained herein and in the Certificates (other than the signature and
countersignature of Owner Trustee on the Certificates) shall be taken as the
statements of Depositor, and Owner Trustee assumes no responsibility for the
correctness thereof. Owner Trustee makes no representations as to the validity
or sufficiency of this Agreement, of any Basic Document or of the Certificates
(other than the signature and countersignature of Owner Trustee on the
Certificates) or the Notes, or of any Receivable or related documents. Owner
Trustee shall at no time have any responsibility or liability for or with
respect to the legality, validity and enforceability of any Receivable, or the
perfection and priority of any security interest created by any Receivable in
any Financed Vehicle or the maintenance of any such perfection and priority, or
for or with respect to the sufficiency of the Owner Trust Estate or its ability
to generate the payments to be distributed to Certificateholders under this
Agreement or the Noteholders under the Indenture, including: the existence,
condition and ownership of any Financed Vehicle; the existence and
enforceability of any insurance thereon; the existence and contents of any
Receivable on any computer or other record thereof; the validity of the
assignment of any Receivable to Issuer or of any intervening assignment; the
completeness of any Receivable; the performance or enforcement of any
Receivable; the compliance by Depositor or 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 Indenture
Trustee, Administrator or Servicer or any subservicer taken in the name of Owner
Trustee.
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20
SECTION 7.7. Owner Trustee May Own Certificates and Notes. Owner Trustee in
its individual or any other capacity may become the owner or pledgee of
Certificates or Notes and may deal with the Transferor, Depositor, Indenture
Trustee, Administrator and Servicer in banking transactions with the same rights
as it would have if it were not Owner Trustee.
ARTICLE VIII COMPENSATION OF OWNER TRUSTEE.
SECTION 8.1. Owner Trustee's Fees and Expenses. Owner Trustee shall receive
as compensation for its services hereunder such fees as have been separately
agreed upon in writing before the date hereof between the Administrator and
Owner Trustee, and Owner Trustee shall be entitled to be reimbursed by the
Administrator for its other reasonable expenses hereunder, including the
reasonable compensation, expenses and disbursements of such agents,
representatives, experts and counsel as Owner Trustee may employ in connection
with the exercise and performance of its rights and its duties hereunder.
SECTION 8.2. Indemnification. The Administrator shall be liable as primary
obligor for, and shall indemnify Owner Trustee and its successors, assigns,
agents and servants (collectively, the "Indemnified Parties") from and against,
any and all liabilities, obligations, losses, damages, taxes, claims, actions
and suits, and any and all reasonable costs, expenses and disbursements
(including reasonable legal fees and expenses) of any kind and nature whatsoever
(collectively, "Expenses") which may at any time be imposed on, incurred by, or
asserted against Owner Trustee or any Indemnified Party in any way relating to
or arising out of this Agreement, the Basic Documents, the Owner Trust Estate,
the administration of the Owner Trust Estate or the action or inaction of Owner
Trustee hereunder, except only that the Administrator shall not be liable for or
required to indemnify 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 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, such
Indemnified Party shall promptly notify the Administrator in writing, and the
Administrator upon request of the Indemnified Party, shall retain counsel
reasonably satisfactory to the Indemnified Party to represent the Indemnified
Party and any others the Administrator may designate in such proceeding and
shall pay the reasonable fees and expenses of such counsel related to such
proceeding. The Administrator 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
Administrator agrees to indemnify any Indemnified Party from and against any
loss or liability by reason of such settlement or judgment. The
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21
Administrator 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 Owner Trustee
pursuant to this Article VIII shall be deemed not to be a part of the Owner
Trust Estate immediately after such payment.
ARTICLE IX TERMINATION OF TRUST AGREEMENT.
SECTION 9.1. Termination of Trust Agreement. This Agreement (other than
Article VIII) and Issuer shall terminate and be of no further force or effect,
upon the final distribution by 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. The bankruptcy,
liquidation, dissolution, death or incapacity of any Certificateholder or Owner
shall not (x) operate to terminate this Agreement or Issuer, nor (y) entitle
such Certificateholder's or 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 Issuer or Owner Trust Estate nor (z) otherwise
affect the rights, obligations and liabilities of the parties hereto.
(b) Except as provided in clause (a), neither Depositor nor any
Certificateholder shall be entitled to revoke or terminate the Issuer.
(c) Notice of any termination of Issuer, specifying the Distribution
Date upon which the Certificateholders shall surrender their Certificates
to Paying Agent for payment of the final distribution and cancellation,
shall be given by Owner Trustee by letter to Certificateholders mailed
within five Business Days of receipt of notice of such termination from
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 presentation and
surrender of the Certificates at the office of Paying Agent therein
designated, (ii) the amount of any such final payment (per $1,000 of
Certificate Balance) 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 Paying
Agent therein specified. Owner Trustee shall give such notice to
Certificate Registrar (if other than Owner Trustee) and Paying Agent at the
time such notice is given to Certificateholders. Upon
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22
presentation and surrender of the Certificates, Paying Agent shall cause to
be distributed to 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, 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, 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 Issuer after exhaustion of such remedies shall be
distributed, subject to applicable escheat laws, by Owner Trustee to the
Transferor.
ARTICLE X SUCCESSOR OWNER TRUSTEES AND ADDITIONAL OWNER TRUSTEES.
SECTION 10.1. Eligibility Requirements for Owner Trustee. Owner Trustee
shall at all times be a bank (i) authorized to exercise corporate trust powers,
(ii) having a combined capital and surplus of at least $50,000,000 and (iii)
subject to supervision or examination by Federal or state authorities. If such
bank 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 Owner
Trustee shall cease to be eligible in accordance with the provisions of this
Section, Owner Trustee shall resign immediately in the manner and with the
effect specified in Section 10.2.
SECTION 10.2. Resignation or Removal of Owner Trustee. Owner Trustee may at
any time resign and be discharged from the trusts hereby created by giving
written notice thereof to Administrator. Upon receiving such notice of
resignation, 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; provided,
however, that such right to appoint or to petition for the appointment of any
such successor shall in no event
TRUST AGREEMENT
23
relieve the resigning Owner Trustee from any obligations otherwise imposed on it
under the Basic Documents until such successor has in fact assumed such
appointment.
If at any time 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 Administrator, or if at any time Owner Trustee shall be legally
unable to act, or shall be adjudged bankrupt or insolvent, or a receiver of
Owner Trustee or of its property shall be appointed, or any public officer shall
take charge or control of Owner Trustee or of its property or affairs for the
purpose of rehabilitation, conservation or liquidation, then Administrator may
remove Owner Trustee. If Administrator shall remove Owner Trustee under the
authority of the immediately preceding sentence, Administrator shall promptly
appoint a successor Owner Trustee by written instrument, in duplicate, one copy
of which instrument shall be delivered to the outgoing Owner Trustee so removed
and one copy to the successor Owner Trustee and payment of all fees owed to the
outgoing Owner Trustee.
Any resignation or removal of 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. Administrator shall provide notice of such resignation
or removal of 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
Administrator and to its predecessor Owner Trustee an instrument accepting such
appointment under this Agreement, and thereupon the resignation or removal of
the predecessor Owner Trustee shall become effective and such successor Owner
Trustee, without any further act, deed or conveyance, shall become fully vested
with all the rights, powers, duties and obligations of its predecessor under
this Agreement, with like effect as if originally named as Owner Trustee. The
predecessor Owner Trustee shall upon payment of its fees and expenses deliver to
the successor Owner Trustee all documents and statements and monies held by it
under this Agreement; and 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.
TRUST AGREEMENT
24
Upon acceptance of appointment by a successor Owner Trustee pursuant to
this Section, Administrator shall mail notice of the successor of such Owner
Trustee to all Certificateholders, Indenture Trustee, the Noteholders and the
Rating Agencies. If 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
Administrator.
SECTION 10.4. Merger or Consolidation of Owner Trustee. Any corporation
into which Owner Trustee may be merged or converted or with which it may be
consolidated, or any corporation resulting from any merger, conversion or
consolidation to which Owner Trustee shall be a party, or any corporation
succeeding to all or substantially all of the corporate trust business of Owner
Trustee, shall, 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, be the successor of Owner Trustee hereunder; provided that such
corporation shall be eligible pursuant to Section 10.1; and provided further
that 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,
Administrator and Owner Trustee acting jointly shall have the power and shall
execute and deliver all instruments to appoint one or more Persons approved by
Owner Trustee to act as co-trustee, jointly with 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 Issuer, or any part
thereof, and, subject to the other provisions of this Section, such powers,
duties, obligations, rights and trusts as Administrator and Owner Trustee may
consider necessary or desirable. If Administrator shall not have joined in such
appointment within 15 days after the receipt by it of a request so to do, Owner
Trustee alone shall have the power to make such appointment. No co-trustee or
separate trustee under this Agreement shall be required to meet the terms of
eligibility as a successor 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 Owner Trustee shall be conferred upon and exercised or
performed by Owner Trustee and such separate trustee or co-trustee
jointly (it being understood that such separate trustee or co-
TRUST AGREEMENT
25
trustee is not authorized to act separately without 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,
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 Issuer or any portion thereof in
any such jurisdiction) shall be exercised and performed singly by such
separate trustee or co-trustee, but solely at the direction of 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) Administrator and 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 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 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, Owner Trustee. Each
such instrument shall be filed with Owner Trustee and a copy thereof given to
Administrator.
Any separate trustee or co-trustee may at any time appoint Owner Trustee,
its agent or attorney-in-fact with full power and authority, to the extent not
prohibited by law, to do any lawful act under or in respect of this Agreement on
its behalf and in its name. If any separate trustee or co-trustee shall become
incapable of acting, resign or be removed, all of its estates, properties,
rights, remedies and trusts shall vest in and be exercised by 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
Depositor and Owner Trustee, with prior written notice to the Rating Agencies,
without the consent of any of the Noteholders or the Certificateholders:
TRUST AGREEMENT
26
(i) 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;
provided that such action shall not, as evidenced by an Opinion
of Counsel, adversely affect in any material respect the
interests of any Noteholder or Certificateholder;
(ii) (A) to add, modify or eliminate such provisions as may
be necessary or advisable in order to enable all or a portion of
Issuer to qualify as, and to permit an election to be made to
cause all or a portion of Issuer to be treated as, a "financial
asset securitization investment trust" as described in the
provisions of the Small Business Job Protection Act of 1996," or
to enable all or a portion of the Issuer to qualify and an
election to be made for similar treatment under such comparable
subsequent federal income tax provisions as may ultimately be
enacted into law, and (B) in connection with any such election,
to modify or eliminate existing provisions set forth in this
Agreement relating to the intended federal income tax treatment
of the Notes or Certificates and Issuer in the absence of the
election; it being a condition to any such amendment that each
Rating Agency shall have notified the Depositor, the Servicer,
Indenture Trustee and the Owner Trustee in writing that the
amendment will not result in a reduction or withdrawal of the
rating of any outstanding Notes or Certificates with respect to
which it is a Rating Agency; and
(iii) to add, modify or eliminate such provisions as may be
necessary or advisable in order to enable (a) the transfer to
Issuer of all or any portion of the Receivables to be
derecognized under GAAP by Depositor to Issuer, (b) Issuer to
avoid becoming a member of Seller's consolidated group under GAAP
or (c) the Depositor, any Seller Affiliate or any of their
Affiliates to otherwise comply with or obtain more favorable
treatment under any law or regulation or any accounting rule or
principle; it being a condition to any such amendment that each
Rating Agency shall have notified the Depositor, the Servicer,
Indenture Trustee and the Owner Trustee in writing that the
amendment will not result in a reduction or withdrawal of the
rating of any outstanding Notes or Certificates with respect to
which it is a Rating Agency.
(b) This Agreement may also be amended from time to time by Depositor and
Owner Trustee, with prior written notice to the Rating Agencies, with the
TRUST AGREEMENT
27
consent of the Holders of Notes evidencing not less than a majority of the
Outstanding Amount of the Notes and, to the extent affected thereby, the consent
of the Holders of Certificates evidencing not less than a majority of the
Certificate Balance for the purpose of adding any provisions to or changing in
any manner or eliminating any of the provisions of this Agreement or of
modifying in any manner the rights of the Noteholders or the Certificateholders;
provided that no such amendment shall (a) increase or reduce in any manner the
amount of, or accelerate or delay the timing of, collections of payments on
Receivables or distributions that shall be required to be made for the benefit
of the Noteholders or the Certificateholders or (b) reduce the aforesaid
percentage of the Outstanding Amount of the Notes and the Certificate Balance
required to consent to any such amendment, without the consent of the Holders of
all the outstanding Notes and Holders of all outstanding Certificates.
(c) Promptly after the execution of any such amendment or consent, Owner
Trustee shall furnish written notification of the substance of such amendment or
consent to each Certificateholder, Indenture Trustee and each of the Rating
Agencies.
(d) It shall not be necessary for the consent of Certificateholders, the
Noteholders or Indenture Trustee pursuant to this Section to approve the
particular form of any proposed amendment or consent, but it shall be sufficient
if such consent, where required, shall approve the substance thereof. The manner
of obtaining such consents (and any other consents of Certificateholders
provided for in this Agreement or in any other Basic Document) and of evidencing
the authorization of the execution thereof by Certificateholders shall be
subject to such reasonable requirements as Owner Trustee may prescribe.
(e) Promptly after the execution of any amendment to the Certificate of
Trust, Owner Trustee shall cause the filing of such amendment with the Secretary
of State.
(f) Prior to the execution of any amendment to this Agreement or the
Certificate of Trust, Owner Trustee shall be entitled to receive and rely upon
an Opinion of Counsel stating that the execution of such amendment is authorized
or permitted by this Agreement and that all conditions precedent to the
execution and delivery of such amendment have been satisfied. Owner Trustee may,
but shall not be obligated to, enter into any such amendment which affects 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 accordance with
Articles V and IX. No transfer, by operation of law or otherwise, of any right,
title or interest of the
TRUST AGREEMENT
28
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 Section 2.7, the
provisions of this Agreement are solely for the benefit of Owner Trustee,
Issuer, Depositor, Administrator, Certificateholders, Servicer and, to the
extent expressly provided herein, Indenture 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. 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, if to Owner Trustee, addressed to the
Corporate Trust Office; if to Depositor, addressed to [_________________],
Attention: ___________; or, as to each party, at such other address as shall be
designated by such party in a written notice to each other party.
(b) Any notice required or permitted to be given to a
Certificateholder shall be given by first-class mail, postage prepaid, at
the address of such Holder as shown in the Certificate Register. Any notice
so mailed within the time prescribed in this Agreement shall be
conclusively presumed to have been duly given, whether or not the
Certificateholder receives such notice.
SECTION 11.5. Severability. Any provision of this Agreement that is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.
SECTION 11.6. Separate Counterparts. This Agreement may be executed by the
parties hereto in separate counterparts, each of which when so executed and
delivered shall be an original, but all such counterparts shall together
constitute but one and the same instrument.
SECTION 11.7. Successors and Assigns. All covenants and agreements
contained herein shall be binding upon, and inure to the benefit of, Depositor,
Owner
TRUST AGREEMENT
29
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. Owner Trustee (not in its individual capacity
but solely as Owner Trustee), by entering into this Agreement, each
Certificateholder or Certificate Owner, by accepting a Certificate, and Trustee
and each Noteholder or Note Owner by accepting the benefits of this Agreement,
hereby covenants and agrees that they will not at any time institute against
Depositor, or join in any institution against Depositor of any bankruptcy,
reorganization, arrangement, insolvency or liquidation proceedings, or other
proceedings under any United States Federal or state bankruptcy or similar law
in connection with any obligations relating to the Certificates, the Notes, this
Agreement or any of the Basic Documents.
SECTION 11.9. No Recourse. Each Certificateholder or Certificate Owner by
accepting a Certificate acknowledges that such Certificateholder's or
Certificate Owner's Certificates represent beneficial interests in Issuer only
and do not represent interests in or obligations of the Transferor, Seller,
Servicer, Administrator, Depositor, Owner Trustee, Indenture Trustee or any
Affiliate thereof and no recourse may be had against such parties or their
assets, except as expressly set forth or contemplated in this Agreement, the
Certificates or the 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 ___________, 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. The Certificates may not
be acquired by or for the account of or with assets of (i) an employee benefit
plan (as defined in Section 3(3) of the Employee Retirement Income Security Act
of 1974 ("ERISA")) that is subject to the provisions of Title 1 of ERISA, (ii) a
plan described in Section 4975(e)(1) of the Code, or (iii) any entity whose
underlying assets include plan assets by reason of a plan's investment in the
entity (each, a "Benefit Plan"). By accepting and holding a Certificate, the
Holder thereof shall be deemed to have represented and warranted that it is not
a Benefit Plan and is not purchasing Certificates on behalf of a Benefit Plan.
TRUST AGREEMENT
30
SECTION 11.13. Servicer. Servicer is authorized to execute on behalf of
Issuer all such documents, reports, filings, instruments, certificates and
opinions as it shall be the duty of Issuer to prepare, file or deliver pursuant
to the Basic Documents. Upon written request, Owner Trustee shall execute and
deliver to Servicer a power of attorney appointing Servicer as Issuer's agent
and attorney-in-fact to execute all such documents, reports, filings,
instruments, certificates and opinions.
SECTION 11.14. Sale and Servicing Agreement. Owner Trustee is hereby
authorized and directed to perform the duties and obligations of the Owner
Trustee set forth in Sections 4.4(b), 4.7, 5.1(c), 8.4 and 10.15 of the Sale and
Servicing Agreement.
TRUST AGREEMENT
31
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.
_________________________________________,
as Owner Trustee
By:______________________________________
Name:
Title:
Bond Securitization, L.L.C., as Depositor
By:______________________________________
Name:
Title:
TRUST AGREEMENT
32
EXHIBIT A
NUMBER $
R- CUSIP NO. _________
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.
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.
[ ] AUTO RECEIVABLES OWNER TRUST 200_-_
______% ASSET BACKED CERTIFICATE
evidencing a beneficial ownership interest in certain distributions of Issuer,
as defined below, the property of which includes a pool of Motor Vehicle Loans
sold to Issuer by Special Purpose Entity.
(This Certificate does not represent an interest in or obligation of Special
Purpose Entity or any of its Affiliates, except to the extent described below.)
THIS CERTIFIES THAT is the registered owner of DOLLARS nonassessable,
fully-paid, beneficial ownership interest in certain distributions of [ ] AUTO
RECEIVABLES OWNER TRUST 200_-_ ("Issuer") formed by Bond Securitization, L.L.C.,
a Delaware limited liability company ("Seller"). This Certificate has a
Certificate Rate of ____% per annum.
TRUST AGREEMENT
Exhibit A, Page 1
TRUST AGREEMENT
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 _____________________________
Authenticating Agent
By___________________________ By ______________________________
Authorized Signatory Authorized Signatory
Issuer was created pursuant to a Trust Agreement dated as of _________ [ ],
200_ (the "Trust Agreement"), between Seller and ________________________, as
owner trustee ("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
Appendix X to the Sale and Servicing Agreement among Issuer, Special Purpose
Entity, as Seller, and [ ] as Servicer, dated as of
___________ [_], 200_, as the same may be amended or supplemented from time to
time.
This Certificate is one of the duly authorized Certificates designated as
"____% Asset Backed Certificates" (herein called the "Certificates"). Also
issued under the Indenture dated as of ___________ [_], 199_, between Issuer and
_______________ as indenture trustee, are four classes of Notes designated as
"Class A-1 _____% Asset Backed Notes" (the "Class A-1 Notes"), and "Class A-2
____% Asset Backed Notes" (the "Class A-2 Notes" and, together with the Class X-
0 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 Seller, Servicer and the Certificateholders that, for
purposes of federal income, state and local income and franchise tax, until the
Trust Certificates
TRUST AGREEMENT
Exhibit A, Page 3
are held by other than the Seller, the Issuer will be disregarded as an entity
separate from its owner. At such time that the Trust Certificates are held by
more than one person, it is the intent of the Seller, Servicer and the
Certificateholders that, for purposes of federal income, state and local income
and franchise tax, the Issuer will be treated as a partnership, the assets of
which are the assets held by the Issuer, and the Certificateholders will be
treated as partners in that partnership. The Depositor and the other
Certificateholders, by acceptance of a Trust Certificate, agree to treat, and to
take no action inconsistent with the treatment of, the Trust Certificates as
such for tax purposes.
Each Certificateholder and Certificate Owner, by its acceptance of a
Certificate, covenants and agrees that such Certificateholder and Certificate
Owner will not at any time institute against Depositor, or join in any
institution against Depositor of, any bankruptcy, reorganization, arrangement,
insolvency or liquidation proceedings, or other proceedings under any United
States Federal or state bankruptcy or similar law in connection with any
obligations relating to the Certificates, the Notes, the Trust Agreement or any
of the Basic Documents.
The Certificates do not represent an obligation of, or an interest in,
Transferor, Seller, Servicer, Administrator, Depositor, Owner Trustee or any
Affiliates of any of them and no recourse may be had against such parties or
their assets, except as may be expressly set forth or contemplated herein or in
the Trust Agreement, the Indenture or the Basic Documents.
The Certificates may not be acquired by or for the account of or with the
assets of (a) an employee benefit plan (as defined in Section 3(3) of ERISA)
that is subject to the provisions of Title 1 of ERISA, (b) a plan described in
Section 4975(e)(1) of the Code or (c) any entity whose underlying assets include
plan assets by reason of a plan's investment in the entity (each, a "Benefit
Plan"). By accepting and holding this Certificate, the Holder hereof shall be
deemed to have represented and warranted that it is not a Benefit Plan and is
not purchasing on behalf of a Benefit Plan.
Unless the certificate of authentication hereon shall have been executed by
an authorized officer of Owner Trustee, by manual signature, this Certificate
shall not entitle the holder hereof to any benefit under the Trust Agreement or
the Sale and Servicing Agreement or be valid for any purpose.
THIS CERTIFICATE SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE
STATE OF DELAWARE, WITHOUT REFERENCE TO ITS CONFLICT OF LAW PROVISIONS, AND THE
OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN
ACCORDANCE WITH SUCH LAWS.
TRUST AGREEMENT
Exhibit A, Page 4
IN WITNESS WHEREOF, Owner Trustee, on behalf of Issuer and not in its
individual capacity, has caused this Certificate to be duly executed.
[ ] AUTO RECEIVABLES OWNER TRUST 200_-_
By: _______________________________,
not in its individual
capacity, but solely as Owner Trustee
Dated: By:________________________________
TRUST AGREEMENT
Exhibit A, Page 5
ASSIGNMENT
FOR VALUE RECEIVED the undersigned hereby sells, assigns and transfers unto
PLEASE INSERT SOCIAL SECURITY
OR OTHER IDENTIFYING NUMBER
OF ASSIGNEE
________________________________________________________________________________
(Please print or type name and address, including postal zip
code, of assignee)
________________________________________________________________________________
the within Certificate, and all rights thereunder, hereby
irrevocably constituting and appointing
_________________________________________________________________ Attorney to
transfer said Certificate on the books of the Certificate Registrar, with full
power of substitution in the premises.
Dated:
*
_____________________________
Signature Guaranteed:
*
______________________________
_______________________
* NOTICE: The signature to this assignment must correspond with the name of
the registered owner as it appears on the face of the within Certificate in
every particular, without alteration, enlargement or any change whatever.
Such signature must be guaranteed by a member firm of the New York Stock
Exchange or a commercial bank or trust company.
TRUST AGREEMENT
Exhibit A, Page 6
EXHIBIT B
CERTIFICATE DEPOSITORY AGREEMENT
TRUST AGREEMENT
