Exhibit 4.1
Form of Trust Agreement
[AMENDED AND RESTATED]
TRUST AGREEMENT
between
ACE SECURITIES CORP.,
as Depositor,
and
[ ]
as Owner Trustee
Dated as of [ ]
TABLE OF CONTENTS
Page
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ARTICLE ONE
DEFINITIONS
Section 1.01. Capitalized Terms.........................................1
Section 1.02. Other Definitional Provisions.............................3
ARTICLE TWO
ORGANIZATION
Section 2.01. Name......................................................4
Section 2.02. Office....................................................4
Section 2.03. Purposes and Powers.......................................4
Section 2.04. Appointment of Owner Trustee..............................5
Section 2.05. Initial Capital Contribution of Trust Estate..............5
Section 2.06. Declaration of Trust......................................5
Section 2.07. Liability of the Owners...................................5
Section 2.08. Title to Trust Property...................................5
Section 2.09. Situs of Trust............................................6
Section 2.10. Representations and Warranties of the Depositor...........6
Section 2.11. Federal Income Tax Allocations............................7
Section 2.12. Investment Company........................................7
ARTICLE THREE
CERTIFICATES AND TRANSFER OF INTERESTS
Section 3.01. Initial Ownership.........................................8
Section 3.02. The Certificates..........................................8
Section 3.03. Authentication of Certificates............................8
Section 3.04. Limitations on Transfer of the Certificates...............8
Section 3.05. Registration of Transfer and Exchange of Certificates....11
Section 3.06. Mutilated, Destroyed, Lost or Stolen Certificates........11
Section 3.07. Persons Deemed Owners....................................12
Section 3.08. Access to List of Certificateholders' Names
and Addresses .........................................12
Section 3.09. Maintenance of Office or Agency..........................12
Section 3.10. Appointment of Paying Agent..............................12
Section 3.11. Book-Entry Certificates..................................13
Section 3.12. Notices to Clearing Agency...............................14
Section 3.13. Definitive Certificates..................................14
ARTICLE FOUR
ACTIONS BY OWNER TRUSTEE
Section 4.01. Prior Notice to Owners with Respect to Certain Matters...14
Section 4.02. Action by Owners with Respect to Certain Matters.........17
Section 4.03. Action with Respect to Bankruptcy........................17
Section 4.04. Restrictions on Owners' Power............................18
Section 4.05. Majority Control.........................................18
ARTICLE FIVE
APPLICATION OF TRUST FUNDS; CERTAIN DUTIES
Section 5.01. Certificate Distribution Account.........................18
Section 5.02. Application of Trust Funds...............................18
Section 5.03. Method of Payment........................................19
Section 5.04. Segregation of Moneys; No Interest.......................19
Section 5.05. Tax Administration.......................................19
ARTICLE SIX
AUTHORITY AND DUTIES OF OWNER TRUSTEE
Section 6.01. General Authority........................................20
Section 6.02. General Duties...........................................20
Section 6.03. Action upon Instruction..................................21
Section 6.04. No Duties Except as Specified in this Agreement
or in Instructions ....................................22
Section 6.05. No Action Except Under Specified Documents
or Instructions .......................................22
Section 6.06. Restrictions.............................................22
ARTICLE SEVEN
CONCERNING THE OWNER TRUSTEE
Section 7.01. Acceptance of Trusts and Duties..........................23
Section 7.02. Furnishing of Documents..................................24
Section 7.03. Representations and Warranties...........................24
Section 7.04. Reliance; Advice of Counsel..............................25
Section 7.05. Not Acting in Individual Capacity........................25
Section 7.06. Owner Trustee Not Liable for Certificates or
Mortgage Loans ........................................26
Section 7.07. Owner Trustee May Own Certificates and Notes.............26
Section 7.08. Doing Business in Other Jurisdictions....................26
Section 7.09. Licenses.................................................26
Section 7.10. Liability of Certificate Registrar and Paying Agent......27
ARTICLE EIGHT
COMPENSATION OF OWNER TRUSTEE
Section 8.01. Owner Trustee's Fees and Expenses........................27
Section 8.02. Indemnification..........................................27
Section 8.03. Payments to the Owner Trustee............................28
ARTICLE NINE
TERMINATION OF TRUST AGREEMENT
Section 9.01. Termination of Trust Agreement...........................28
ARTICLE TEN
SUCCESSOR OWNER TRUSTEES AND ADDITIONAL OWNER TRUSTEES
Section 10.01. Eligibility Requirements for Owner Trustee...............29
Section 10.02. Resignation or Removal of Owner Trustee..................29
Section 10.03. Successor Owner Trustee..................................30
Section 10.04. Merger or Consolidation of Owner Trustee.................31
Section 10.05. Appointment of Co-Trustee or Separate Trustee............31
ARTICLE ELEVEN
MISCELLANEOUS
Section 11.01. Supplements and Amendments...............................32
Section 11.02. No Legal Title to Trust Estate in Owners.................33
Section 11.03. Limitations on Rights of Others..........................34
Section 11.04. Notices..................................................34
Section 11.05. Severability.............................................34
Section 11.06. Separate Counterparts....................................34
Section 11.07. Successors and Assigns...................................34
Section 11.08. No Petition..............................................34
Section 11.09. No Recourse..............................................35
Section 11.10. Headings.................................................35
Section 11.11. Governing Law............................................35
Section 11.12. [Grant of Certificateholder Rights to Note Insurer.......35]
Section 11.13. [Third-Party Beneficiary.................................35]
Section 11.14. [Suspension and Termination of Note Insurer's Rights.....36]
Section 11.15. [Fiduciary Obligation to Holders of the Certificates.....36]
THIS [AMENDED AND RESTATED] TRUST AGREEMENT dated as of [ ] (the "Trust
Agreement"), between ACE SECURITIES CORP., a Delaware corporation, as depositor
(the "Depositor") and [ ], a [ ] banking corporation, as owner trustee (the
"Owner Trustee").
W I T N E S S E T H:
In consideration of the mutual agreements and covenants herein
contained, the Depositor and the Owner Trustee hereby agree for the benefit of
each of them and the holders of the Certificates as follows:
ARTICLE ONE
DEFINITIONS
Section 1.01. Capitalized Terms. For all purposes of this Agreement,
the following terms shall have the meanings set forth below:
Aggregate Voting Interests: The aggregate of the Voting Interests of
all or a specified Class or Classes of Certificates.
Agreement: This Trust Agreement, as the same may be amended and
supplemented from time to time.
Book-Entry Certificates: Beneficial interests in Certificates
designated as "Book-Entry Certificates" in this Agreement, ownership and
transfers of which shall be evidenced or made through book entries by a Clearing
Agency as described in Section 3.11; provided, that after the occurrence of a
condition whereupon Definitive Certificates are to be issued to Certificate
Owners, such Book-Entry Certificates shall no longer be "Book-Entry
Certificates." No Certificate shall be Book-Entry Certificate.
[Business Trust Statute: Chapter 38 of Title 12 of the Delaware Code,
12 Del. Code ss. 3801 et seq., as the same may be amended from time to time.]
Certificate Depository Agreement: Any agreement among the Trust, the
Owner Trustee, the Administrator and The Depository Trust Company, as the
initial Clearing Agency relating to the Certificates pursuant to which a
Certificate is issued in book-entry form.
[Certificate of Trust: The Certificate of Trust substantially in the
form attached hereto as Exhibit B filed for the Trust pursuant to Section
3810(a) of the Business Trust Statute.]
Certificate Owner: With respect to a Book-Entry Certificate, the Person
that is the beneficial owner of such Book-Entry Certificate, as reflected on the
books of the Clearing Agency or on the books of a Person maintaining an account
with such Clearing Agency (directly as a Clearing Agency Participant or as an
indirect participant, in each case in accordance with the rules of such Clearing
Agency).
Certificate Register and Certificate Registrar: The register mentioned
and the registrar appointed pursuant to Section 3.05.
Certificateholder or Holder: A Person in whose name a Certificate is
registered on the Certificate Register.
Corporate Trust Office: With respect to the Owner Trustee, the
principal corporate trust office of the Owner Trustee, located at [ ],
Attention: [ ], or at such other address as the Owner Trustee may designate by
notice to the Owners, [the Note Insurer] and the Depositor, or the principal
corporate trust office of any successor Owner Trustee at the address designated
by such successor Owner Trustee by notice to the Owners and the Depositor.
Definitive Certificate: As defined in Section 3.11.
ERISA-Restricted Certificate: Any Certificate.
Expenses: The meaning assigned to such term in Section 8.02.
Indemnified Parties: The meaning assigned to such term in
Section 8.02.
Non-United States Person: Any person other than a United States
Person.
Owner: Each Holder of a Certificate.
Paying Agent: Any paying agent or co-paying agent appointed pursuant to
Section 3.10; the initial Paying Agent shall be Bankers Trust Company.
Prospective Owner: Each prospective purchaser and any subsequent
transferee of a Certificate.
Residual Interest Certificate: Any residual interest certificate
evidencing the ownership interest in the Trust, substantially in the form
attached hereto as Exhibit A.
Sale and Servicing Agreement: The Sale and Servicing Agreement dated as
of [ ], among the Trust, as issuer, the Depositor, the Servicer, and [ ], as
Indenture Trustee, as such may be amended or supplemented from time to time.
Secretary of State: The Secretary of State of the State of [ ].
Treasury Regulations: Regulations, including proposed or temporary
regulations, promulgated under the Code. References herein to specific
provisions of proposed or temporary regulations shall include analogous
provisions of final Treasury Regulations or other successor Treasury
Regulations.
Trust: The trust established under this Agreement.
Voting Interests: The portion of the voting rights of all the
Certificates that is allocated to any Certificate for purposes of the voting
provisions of this Agreement. At all times during the term of this Agreement,
Voting Interests shall be allocated to the Residual Interest Certificates.
Voting Interests allocated to any Class of Certificates shall be allocated among
the Certificates of such Class in proportion to the Percentage Interests
thereof. Notwithstanding the foregoing, solely for the purposes of the giving of
any consent, waiver, request or demand pursuant to this Agreement, any
Certificate registered in the name of the Seller, the Issuer, the Owner Trustee,
the Indenture Trustee, the Servicer, the Administrator or any of their
respective Affiliates, shall be deemed not to be outstanding and the Voting
Interests allocated thereto shall not be taken into account in determining
whether the requisite Aggregate Voting Interests necessary to take any such
action or effect any such consent, waiver, request or demand have been obtained
(unless such action requires the consent, waiver, request or demand of 100% of
the Aggregate Voting Interests represented by a particular Class and 100% of the
Voting Interests represented by such Class are registered in the name of one or
more of the foregoing entities). The Owner Trustee may obtain and conclusively
rely upon a certificate of the Issuer, the Seller, the Servicer or any
Sub-Servicer to determine whether a Certificate is registered in the name of an
Affiliate of any of them.
Section 1.02. Other Definitional Provisions. (a) Capitalized terms used
and not otherwise defined herein have the meanings assigned to them in the Sale
and Servicing Agreement or, if not defined therein, in the Indenture.
(b) All terms defined in this Agreement shall have the defined meanings
when used in any certificate or other document made or delivered pursuant hereto
unless otherwise defined therein.
(c) As used in this Agreement and in any certificate or other document
made or delivered pursuant hereto or thereto, accounting terms not defined in
this Agreement or in any such certificate or other document, and accounting
terms partly defined in this Agreement or in any such certificate or other
document to the extent not defined, shall have the respective meanings given to
them under generally accepted accounting principles. To the extent that the
definitions of accounting terms in this Agreement or in any such certificate or
other document are inconsistent with the meanings of such terms under generally
accepted accounting principles, the definitions contained in this Agreement or
in any such certificate or other document shall control.
(d) The words "hereof," "herein," "hereunder" and words of similar
import when used in this Agreement shall refer to this Agreement as a whole and
not to any particular provision of this Agreement; Section and Exhibit
references contained in this Agreement are references to Sections and Exhibits
in or to this Agreement unless otherwise specified; and the term "including"
shall mean "including without limitation".
(e) The definitions contained in this Agreement are applicable to the
singular as well as the plural forms of such terms and to the masculine as well
as to the feminine and neuter genders of such terms.
(f) Any agreement, instrument or statute defined or referred to herein
or in any instrument or certificate delivered in connection herewith means such
agreement, instrument or statute as from time to time amended, modified or
supplemented and includes (in the case of agreements or instruments) references
to all attachments thereto and instruments incorporated therein; references to a
Person are also to its permitted successors and assigns.
ARTICLE TWO
ORGANIZATION
Section 2.01. Name. The Trust created hereby shall be known as "ACE
Securities Corp. [ ] Trust [ ]," in which name the Owner Trustee may conduct the
business of the Trust, make and execute contracts and other instruments on
behalf of the Trust and sue and be sued.
Section 2.02. Office. The office of the Trust shall be in care of the
Owner Trustee at the Corporate Trust Office or at such other address in [ ] as
the Owner Trustee may designate by written notice to the Owners, [the Note
Insurer] and the Depositor.
Section 2.03. Purposes and Powers. (a) The purpose of the Trust is to
engage in the following activities:
(i) to issue the Notes pursuant to the Indenture and the
Certificates pursuant to this Agreement and to sell the Notes and
the Certificates;
(ii) with the proceeds of the sale of the Notes and the
Certificates, to purchase the Mortgage Loans, to pay the
organizational, start-up and transactional expenses of the Trust and to
pay the balance to the Depositor pursuant to the Sale and Servicing
Agreement;
(iii) to assign, grant, transfer, pledge, mortgage and convey
the Trust Estate pursuant to the Indenture and to hold, manage and
distribute to the Owners pursuant to the terms of the Sale and
Servicing Agreement any portion of the Trust Estate released from the
lien of, and remitted to the Trust pursuant to, the Indenture;
(iv) to enter into and perform its obligations under the Basic
Documents to which it is to be a party;
(v) to engage in those activities, including entering into
agreements, that are necessary, suitable or convenient to accomplish
the foregoing or are incidental thereto or connected therewith; and
(vi) subject to compliance with the Basic Documents, to engage
in such other activities as may be required in connection with
conservation of the Trust Estate and the making of distributions to the
Owners and the Noteholders.
The Trust is hereby authorized to engage in the foregoing activities. The Trust
shall not engage in any activity other than in connection with the foregoing or
other than as required or authorized by the terms of this Agreement or the Basic
Documents.
Section 2.04. Appointment of Owner Trustee. The Depositor hereby
appoints the Owner Trustee as trustee of the Trust effective as of the date
hereof, to have all the rights, powers and duties set forth herein.
Section 2.05. Initial Capital Contribution of Trust Estate. The
Depositor hereby sells, assigns, transfers, conveys and sets over to the Owner
Trustee, as of the date hereof, the sum of $1. The Owner Trustee hereby
acknowledges receipt in trust from the Depositor, as of the date hereof, of the
foregoing contribution, which shall constitute the initial Trust Estate and
shall be deposited in the Certificate Distribution Account. The Depositor shall
pay organizational expenses of the Trust as they may arise or shall, upon the
request of the Owner Trustee, promptly reimburse the Owner Trustee for any such
expenses paid by the Owner Trustee.
Section 2.06. Declaration of Trust. The Owner Trustee hereby declares
that it will hold the Trust Estate in trust upon and subject to the conditions
set forth herein for the use and benefit of the Owners, subject to the
obligations of the Trust under the Basic Documents. It is the intention of the
parties hereto that the Trust constitute a [business trust under the Business
Trust Statute] [trust under the common law of the State of New York] and that
this Agreement constitute the governing instrument of such [business] trust. It
is the intention of the parties hereto that, solely for federal, state and local
income and franchise tax purposes (i) so long as the sole owners of the Trust
are the Residual Interestholders, (A) the Trust shall be treated as a [grantor
trust], with the assets of the Trust being the Mortgage Loans and other assets
held by the Trust and the Notes being non-recourse debt of the sole owner, and
(B) the arrangement between the Residual Interestholders' interest in the
Mortgage Loans and the Noteholders shall be treated as a security arrangement,
and (ii) if the Residual Interestholders are not the sole owners of the Trust,
the Trust shall be treated as a partnership for income and franchise tax
purposes, with the assets of the partnership being the Mortgage Loans and other
assets held by the Trust, the partners of the partnership being the owners and
notes being debt of the partnership to the extent they have not otherwise been
recharacterized. The Trust shall not elect to be treated as an association under
Treasury Regulation Section 301, 7701-3(a) for federal income tax purposes. The
parties agree that, unless otherwise required by appropriate tax authorities,
the Trust will file or cause to be filed annual or other necessary returns,
reports and other forms consistent with the characterization of the Trust as a
security arrangement for tax purposes. Effective as of the date hereof, the
Owner Trustee shall have all rights, powers and duties set forth herein [and in
the Business Trust Statute] with respect to accomplishing the purposes of the
Trust.
Section 2.07. Liability of the Owners. No Owner shall have any personal
liability for any liability or obligation of the Trust.
Section 2.08. Title to Trust Property.
(a) Subject to the Indenture, legal title to the Trust Estate shall be
vested at all times in the Trust as a separate legal entity except where
applicable law in any jurisdiction requires title to any part of the Trust
Estate to be vested in a trustee or trustees, in which case title shall be
deemed to be vested in the Owner Trustee, a co-trustee and/or a separate
trustee, as the case may be.
(b) The Owners shall not have legal title to any part of the Trust
Estate. No transfer by operation of law or otherwise of any interest of the
Owners shall operate to terminate this Agreement or the trusts hereunder or
entitle any transferee to an accounting or to the transfer to it of any part of
the Trust Estate.
Section 2.09. Situs of Trust. The Trust will be located and
administered in the State of [ ]. All bank accounts maintained by the Owner
Trustee on behalf of the Trust shall be located in the State of [ ] [or the
State of New York], except with respect to accounts maintained by the
Administrator or the Indenture Trustee on behalf of the Owner Trustee. The Trust
shall not have any employees in any state other than [ ]; provided, however,
that nothing herein shall restrict or prohibit the Owner Trustee from having
employees within or without the State of [ ]. Payments will be received by the
Trust only in [ ] [or New York], and payments will be made by the Trust only
from [ ] [or New York]. The only office of the Trust will be at the Corporate
Trust Office in [ ].
Section 2.10. Representations and Warranties of the Depositor. The
Depositor hereby represents and warrants to the Owner Trustee [and the Note
Insurer] that:
(a) The Depositor is a corporation duly organized, validly existing,
and in good standing under the laws of the State of Delaware.
(b) The Depositor has the corporate power and authority to execute and
deliver this Agreement and to perform in accordance herewith; the execution,
delivery and performance of this Agreement (including all instruments of
transfer to be delivered pursuant to this Agreement) by the Depositor and the
consummation of the transactions contemplated hereby have been duly and validly
authorized by all necessary action of the Depositor.
(c) This Agreement evidences the valid, binding and enforceable
obligation of the Depositor; and all requisite action has been taken by the
Depositor to make this Agreement valid, binding and enforceable upon the
Depositor in accordance with its terms, subject to the effect of bankruptcy,
insolvency, reorganization, moratorium and other, similar laws relating to or
affecting creditors' rights generally or the application of equitable principles
in any proceeding, whether at law or in equity.
(d) No consent, approval, authorization or order of or registration or
filing with, or notice to, any governmental authority or court is required for
the execution, delivery and performance of or compliance by the Depositor with
this Agreement or the consummation by the Depositor of any of the transactions
contemplated hereby, except as have been made on or prior to the Closing Date.
(e) None of the execution and delivery of this Agreement, the
consummation of the transactions contemplated by this Agreement and the
fulfillment of the terms hereof do not conflict with, result in any breach of
any of the terms and provisions of, or constitute (with or without notice or
lapse of time) a default under, the charter or bylaws of the Depositor, or
conflict with or breach any of the material terms or provisions of, or
constitute (with or without lapse of time) a default under, any indenture,
agreement or other instrument to which the Depositor is a party or by which it
is bound; or result in the creation or imposition of any Lien upon any of its
properties pursuant to the terms of any such indenture, agreement or other
instrument (other than pursuant to the Basic Documents); or violate any law or,
to the best knowledge of the Depositor, any order, rule or regulation applicable
to the Depositor of any court or of any federal or state regulatory body,
administrative agency or other governmental instrumentality having jurisdiction
over the Depositor or its properties.
(f) There are no proceedings or investigations pending or, to the best
knowledge of the Depositor, threatened before any court, regulatory body,
administrative agency or other tribunal or governmental instrumentality (A)
asserting the invalidity of this Agreement, (B) seeking to prevent the
consummation of any of the transactions contemplated by this Agreement or (C)
seeking any determination or ruling that, in the reasonable judgment of the
Depositor, would materially and adversely affect the performance by the
Depositor of its obligations under this Agreement.
(g) The Depositor is not in default with respect to any order or decree
of any court or any order, regulation or demand of any federal, state, municipal
or other governmental agency, which default might have consequences that would
materially and adversely affect the condition (financial or otherwise) or
operations of the Depositor or its properties or might have consequences that
would materially and adversely affect its performance hereunder.
(h) The representations and warranties of the Depositor in Section 3.02
of the Sale and Servicing Agreement are true and correct.
(i) The Depositor shall not take any action (i) that is inconsistent
with the purposes of the Trust set forth in Section 2.03 or (ii) that, to the
actual knowledge of the Depositor, would result in the Trust's becoming taxable
as a corporation for federal income tax purposes.
Section 2.11. Federal Income Tax Allocations. Net income of the Trust
as computed for federal income tax purposes (including each item of income,
gain, and deduction, but not including any default loss realized by the Trust
with respect to the Mortgage Loans) for any taxable year shall be allocated as
follows: (a) to the extent that the Certificates are owned (for federal income
tax purposes) by a single owner, 100% to the Certificateholder, and (b) to the
extent that a Holder of a Certificate is different from the Residual
Interestholders, income shall be calculated separately for each Certificate
based on the respective Mortgage Loans and other assets of the Trust treated as
owned by the particular Certificate of the related Class and income shall be
allocated to each Certificateholder accordingly.
Section 2.12. Investment Company. The Depositor hereby agrees, and each
Certificateholder shall be deemed to have agreed by acceptance of such
Certificate, not to take any action that would cause the Trust to become an
"investment company" which would be required to register under the Investment
Company Act of 1940, as amended.
ARTICLE THREE
CERTIFICATES AND TRANSFER OF INTERESTS
Section 3.01. Initial Ownership. Upon the formation of the Trust by the
contribution by the Depositor pursuant to Section 2.05 and until the issuance of
the Certificates, the Depositor shall be the sole beneficiary of the Trust. Upon
such issuance of the Certificates, the Depositor shall cease to be the
beneficial owner of the Trust and its beneficial interest in the Trust shall be
and shall be deemed cancelled, void, and of no further force and effect.
Section 3.02. The Certificates. Each Residual Interest Certificate
shall be issued and maintained in definitive, fully registered form as a single
Certificate evidencing a Percentage Interest of not less than 25%. Each
Certificate shall be executed on behalf of the Trust by manual or facsimile
signature of an authorized officer of the Owner Trustee. Certificates bearing
the manual or facsimile signatures of individuals who were, at the time when
such signatures shall have been affixed, authorized to sign on behalf of the
Trust, shall be validly issued and entitled to the benefit of this Agreement,
notwithstanding that such individuals or any of them shall have ceased to be so
authorized prior to the authentication and delivery of such Certificates or did
not hold such offices at the date of authentication and delivery of such
Certificates.
Upon issuance of the Certificates, the Owner Trustee shall authenticate
the Certificates in accordance with the written instructions of the prospective
transferee thereof. Neither the Certificate Registrar nor the Owner Trustee
shall be liable for any delay in delivery of such instructions and may
conclusively rely on, and shall be protected in relying on, such instructions.
Upon the issuance of any such Certificate, the Owner Trustee shall recognize the
Holders of the Certificates as Certificateholders. The Certificates shall be
printed, lithographed or engraved or may be produced in any other manner as is
reasonably acceptable to the Owner Trustee, as evidenced by its execution
thereof.
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 such transferee's acceptance of a Certificate
duly registered in such transferee's name pursuant to Section 3.04.
Section 3.03. Authentication of Certificates. On the Closing Date, the
Owner Trustee shall cause the Certificates to be executed on behalf of the
Trust, authenticated and delivered to or upon the written order of the
Depositor, without further trust action by the 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 forms set forth
in Exhibit A, executed by the Owner Trustee or the Owner Trustee's
authenticating agent, by manual 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 3.04. Limitations on Transfer of the Certificates. (a) Each
Prospective Owner of a Book-Entry Certificate other than the Depositor or the
Seller or an affiliate of either of them shall be deemed to have represented and
warranted, and each Prospective Owner of a Definitive Certificate and each
Prospective Owner of a Certificate upon initial issuance shall represent and
warrant in writing, in substantially the form set forth in Exhibit C or Exhibit
D, as applicable, to the Owner Trustee, [the Note Insurer] and the Certificate
Registrar and any of their respective successors that:
(i) Such Person is duly authorized to purchase the
Certificates and its purchase of investments having the characteristics
of the Certificates is authorized under, and not directly or indirectly
in contravention of, any law, charter, trust instrument or other
operative document, investment guidelines or list of permissible or
impermissible investments that is applicable to the investor; and
(ii) Such Person understands that each holder of a
Certificate, by virtue of its acceptance thereof, assents to the terms,
provisions and conditions of the Agreement.
(b) Each Prospective Owner of a Book-Entry Certificate shall be deemed
to have represented and warranted, and each Prospective Owner of a Definitive
Certificate and each Prospective Owner of a Certificate upon initial issuance,
shall represent and warrant in writing, in substantially the form set forth in
Exhibit C or Exhibit D, as applicable, to the Owner Trustee, [the Note Insurer]
and the Certificate Registrar and any of their respective successors that:
(i) Such Person is (A) a qualified institutional buyer (a
"QIB") as defined in Rule 144A under the Securities Act ("Rule 144A")
and is aware that the seller of such Certificate may be relying on the
exemption from the registration requirements of the Securities Act
provided by Rule 144A and is acquiring such Certificate for its own
account or for the account of one or more qualified institutional
buyers for whom it is authorized to act, or (B), in the case of a
Prospective Owner of a Certificate other than the Residual Interest
Certificate, an institutional investor that is an "accredited investor"
(as defined in Rule 501(a)(1), (2), (3) or (7) under the Securities
Act.
(ii) It understands that such Certificates have not been
registered under the Securities Act, and that, if in the future it
decides to offer, resell, pledge or otherwise transfer such
Certificates, such Certificates may be offered, resold, pledged or
otherwise transferred only (A) pursuant to a registration statement
which has been declared effective under the Securities Act, (B) for so
long as such Certificates are eligible for resale pursuant to Rule
144A, to a person whom the seller reasonably believes is a QIB that is
purchasing such Certificates for its own account or for the account of
a QIB to whom notice is given that the transfer is being made in
reliance on Rule 144A, or (C) to an institutional "accredited investor"
within the meaning of subparagraph (a)(1), (2), (3) or (7) of Rule 501
under the Securities Act that is acquiring such Certificates for its
own account or for the account of an institutional "accredited
investor," for investment purposes and not with a view to, or for offer
or sale in connection with, any distribution in violation of the
Securities Act, in each case in compliance with the requirements of the
Trust Agreement.
In the event that a transfer of a Definitive Certificate is to be made
in reliance upon an exemption from the Securities Act and state securities laws,
in order to assure compliance with the Securities Act and such laws, the
prospective transferee shall certify to the Owner Trustee [and the Note Insurer]
in writing the facts surrounding the transfer in substantially the form set
forth in Exhibit C or Exhibit D, as applicable. As a condition to any transfer
pursuant to clause (b)(ii)(C) above, the Owner Trustee, [the Note Insurer] or
the Certificate Registrar may require that the prospective transferee (x)
certify in writing that such transfer is to be made in accordance with Rule 144
under the Securities Act or (y) deliver an Opinion of Counsel satisfactory to
the Owner Trustee, [the Note Insurer] or the Certificate Registrar, as
applicable, to the effect that such transfer will be exempt from registration
under the Securities Act.
The Owner Trustee on behalf of the Depositor (and with the Depositor's
cooperation) shall provide to any Holder of a Certificate and any prospective
transferee designated by any such Holder, information regarding the Certificates
and the Mortgage Loans and such other information as shall be necessary to
satisfy the condition to eligibility set forth in Rule 144A(d)(4) for transfer
of any such Certificate without registration thereof under the Securities Act
pursuant to the registration exemption provided by Rule 144A. Each Holder of a
Definitive Certificate desiring to effect such a transfer shall, and does hereby
agree to, indemnify the Trust, the Owner Trustee, [the Note Insurer] and the
Depositor against any liability that may result if the transfer is not so exempt
or is not made in accordance with federal and state securities laws.
(c) With respect to transfers of ERISA-Restricted Certificates, each
Prospective Owner of a Book-Entry Certificate shall be deemed to have
represented and warranted, and each Prospective Owner of a Definitive
Certificate and each Prospective Owner of a Certificate upon initial issuance
shall represent and warrant in writing, in substantially the form set forth in
Exhibit E, to the Owner Trustee, [the Note Insurer] and the Certificate
Registrar and any of their respective successors that (i) such Prospective Owner
is not, and on the date of transfer of such Certificate will not be, and on such
date will not be investing the funds of, an employee benefit plan subject to
ERISA or a plan subject to Section 4975 of the Code or (ii) such Prospective
Owner is an insurance company investing assets of its general account and the
exemptions provided by Section III(a) of Department of Labor Prohibited
Transaction Class Exemption 95-60, 60 Fed. Reg. 35925 (July 12, 1995) apply to
such Prospective Owner's acquisition and holding of such Certificate. No
transfer of an ERISA-Restricted Certificate that is also a Definitive
Certificate shall be made to any Person unless the Owner Trustee has received a
certificate from the transferee in substantially the form set forth in Exhibit E
to the foregoing effect.
(d) Notwithstanding anything to the contrary herein, no transfer of any
Residual Interest Certificate shall be made to any Person unless the Owner
Trustee has received a certificate (i) from the transferee in substantially the
form set forth in Exhibit D, to the effect that such Person is a QIB and is
aware that the seller of such Certificate may be relying on the exemption from
the registration requirements of the Securities Act provided by Rule 144A and is
acquiring such Certificate for its own account or for the account of one or more
QIBs for whom it is authorized to act or (ii) to the effect that the transferee
is the Depositor or the Seller, or an affiliate (as defined in Rule 405 under
the Securities Act) of the Depositor or the Seller, and in each case stating
that such person understands that such Residual Interest Certificate bears a
legend substantially similar to the legend provided in Exhibit A hereto.
(e) The Owner Trustee shall cause each Certificate to contain a legend,
substantially similar to the applicable legends provided in Exhibit A hereto,
stating that transfer of such Certificate is subject to certain restrictions and
referring prospective purchasers of the Certificates to this Section 3.04 with
respect to such restrictions.
Section 3.05. Registration of Transfer and Exchange of Certificates.
The Certificate Registrar shall keep or cause to be kept, at the office or
agency maintained pursuant to Section 3.09, a Certificate Register in which,
subject to such reasonable regulations as it may prescribe, the Owner Trustee
shall provide for the registration of Certificates and of transfers and
exchanges of Certificates as herein provided. The Administrator is hereby
appointed as the initial Certificate Registrar.
Upon surrender for registration of transfer of any Certificate at the
office or agency maintained pursuant to Section 3.09 and upon satisfaction of
the applicable conditions set forth in Section 3.04, the Owner Trustee shall
execute, authenticate and deliver (or shall cause 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
aggregate amount dated the date of authentication by the Owner Trustee or any
authenticating agent. At the option of a Holder, Certificates may be exchanged
for other Certificates of authorized denominations of a like aggregate amount
upon surrender of the Certificates to be exchanged at the office or agency
maintained pursuant to Section 3.09.
Every Certificate presented or surrendered for registration of transfer
or exchange shall be accompanied by a written instrument of transfer in form
satisfactory to the Owner Trustee and the Certificate Registrar duly executed by
the Holder or such Holder's attorney duly authorized in writing. Each
Certificate surrendered for registration of transfer or exchange shall be
cancelled and subsequently disposed of by the Owner Trustee in accordance with
its customary practice.
No service charge shall be made for any registration of transfer or
exchange of Certificates, but the Owner Trustee or the Certificate Registrar may
require payment of a sum sufficient to cover any tax or governmental charge that
may be imposed in connection with any transfer or exchange of Certificates.
Section 3.06. Mutilated, Destroyed, Lost or Stolen Certificates. If (a)
any mutilated Certificate shall be surrendered to the Certificate Registrar, or
if the Certificate Registrar shall receive evidence to its satisfaction of the
destruction, loss or theft of any Certificate and (b) there shall be delivered
to the Certificate Registrar and the Owner Trustee such security or indemnity as
may be required by them to save each of them harmless, then in the absence of
notice that such Certificate has been acquired by a bona fide purchaser , and
upon certification provided by the Holder of such Certificate that the
requirements of Section 8-405 of the Relevant UCC have been met, the Owner
Trustee on behalf of the Trust shall execute and the Owner Trustee or the 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 tenor and denomination. In connection with the issuance of
any new Certificate under this Section, the Owner Trustee or the Certificate
Registrar may require the payment of a sum sufficient to cover any 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 ownership in the Trust, as if originally issued, whether or not the lost,
stolen or destroyed Certificate shall be found at any time.
Section 3.07. Persons Deemed Owners. Prior to due presentation of a
Certificate for registration of transfer, the Owner Trustee, the Certificate
Registrar or any Paying Agent may treat the Person in whose name any Certificate
is registered in the Certificate Register as the owner of such Certificate for
the purpose of receiving distributions pursuant to Section 5.02 and for all
other purposes whatsoever, and none of the Owner Trustee, the Certificate
Registrar or any Paying Agent shall be bound by any notice to the contrary.
Section 3.08. Access to List of Certificateholders' Names and
Addresses. The Certificate Registrar shall furnish or cause to be furnished to
the Servicer, [the Note Insurer] and the Depositor, within 15 days after receipt
by the Certificate Registrar of a written request therefor from the Servicer,
[the Note Insurer] or the Depositor, a list, in such form as the Servicer or the
Depositor may reasonably require, of the names and addresses of the
Certificateholders as of the most recent Record Date. If three or more
Certificateholders or one or more Holders of Certificates evidencing not less
than 25% of the Voting Interests of the Certificates apply in writing to the
Certificate Registrar, and such application states that the applicants desire to
communicate with other Certificateholders with respect to their rights under
this Agreement or under the Certificates and such application is accompanied by
a copy of the communication that such applicants propose to transmit, then the
Certificate Registrar shall, within five Business Days after the receipt of such
application, afford such applicants access during normal business hours to the
current list of Certificateholders. Each Holder, by receiving and holding a
Certificate, shall be deemed to have agreed not to hold any of the Depositor,
[the Note Insurer] the Certificate Registrar or the Owner Trustee accountable by
reason of the disclosure of its name and address, regardless of the source from
which such information was derived.
Section 3.09. Maintenance of Office or Agency. The Owner Trustee shall
maintain in the Borough of Manhattan, The City of New York, an office or offices
or agency or agencies where Certificates may be surrendered for registration of
transfer or exchange and where notices and demands to or upon the Owner Trustee
in respect of the Certificates and the Basic Documents may be served. The Owner
Trustee initially designates the Administrator's office in New York as its
office for such purposes. The Owner Trustee shall give prompt written notice to
the Depositor, [the Note Insurer] and to the Certificateholders of any change in
the location of the Certificate Register or any such office or agency.
Section 3.10. Appointment of Paying Agent. The Paying Agent shall make
distributions to Certificateholders from the Certificate Distribution Account
pursuant to Section 5.02 and shall report the amounts of such distributions to
the Owner Trustee. Any Paying Agent shall have the revocable power to withdraw
funds from the Certificate Distribution Account for the purpose of making the
distributions referred to above. The Owner Trustee may revoke such power and
remove the Paying Agent if the Owner Trustee determines in its sole discretion
that the Paying Agent shall have failed to perform its obligations under this
Agreement in any material respect. The Paying Agent initially shall be the
Administrator (who is hereby appointed as Paying Agent), and any co-paying agent
chosen by the Depositor and acceptable to the Owner Trustee. The Administrator
shall be permitted to resign as Paying Agent upon 30 days' written notice to the
Owner Trustee. In the event that the Administrator shall no longer be the Paying
Agent, the Owner Trustee shall promptly appoint a successor to act as Paying
Agent (which shall be a bank or trust company). The Owner Trustee shall cause
such successor Paying Agent or any additional Paying Agent appointed by the
Owner Trustee to execute and deliver to the Owner Trustee an instrument in which
such successor Paying Agent or additional Paying Agent shall agree with the
Owner Trustee that, as Paying Agent, such successor Paying Agent or additional
Paying Agent will hold all sums, if any, held by it for payment to the
Certificateholders in trust for the benefit of the Certificateholders entitled
thereto until such sums shall be paid to such Certificateholders. The Paying
Agent shall return all unclaimed funds to the Owner Trustee and upon removal of
a Paying Agent such Paying Agent shall also return all funds in its possession
to the Owner Trustee. The provisions of Sections 7.01, 7.03, 7.04 and 8.01 shall
apply to the Owner Trustee also in its role as Paying Agent, for so long as the
Owner Trustee shall act as Paying Agent and, to the extent applicable, to any
other paying agent appointed hereunder. Any reference in this Agreement to the
Paying Agent shall include any co-paying agent unless the context requires
otherwise.
Section 3.11. Book-Entry Certificates. Any Book-Entry Certificates
shall be issued in the form of typewritten certificates or global certificates
representing Book-Entry Certificates, to be delivered to, or to the
Administrator as custodian for, The Depository Trust Company, the initial
Clearing Agency, by or on behalf of the Trust. Such Book-Entry Certificate or
Book-Entry Certificates shall initially be registered on the Certificate
Register in the name of Cede & Co., the nominee of the initial Clearing Agency,
and except as provided in Section 3.13, no Certificate Owner will receive a
Definitive Certificate representing such Certificate Owner's interest in such
Book-Entry Certificate. So long as any Book-Entry Certificates are outstanding,
unless and until definitive, fully registered Certificates (the "Definitive
Certificates") have been issued to Certificate Owners pursuant to Section 3.13:
(a) The provisions of this Section shall be in full force and effect;
(b) The Certificate Registrar and the Owner Trustee shall be entitled
to deal with the Clearing Agency for all purposes of this Agreement (including
the payment of principal of and interest on the Book-Entry Certificates and the
giving of instructions or directions hereunder) as the sole Holder of the
Book-Entry Certificates and shall have no obligation to the Certificate Owners;
(c) To the extent that the provisions of this Section conflict with any
other provisions of this Agreement, the provisions of this Section shall
control;
(d) The rights of Certificate Owners shall be exercised only through
the Clearing Agency and shall be limited to those established by law and
agreements between such Certificate Owners and the Clearing Agency and/or the
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 the 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 Book-Entry Certificates
evidencing a specified percentage of the Voting Interests thereof, the Clearing
Agency shall be deemed to represent such percentage only to the extent that it
has received instructions to such effect from Certificate Owners and/or Clearing
Agency Participants owning or representing, respectively, such required
percentage of the beneficial interest in the Book-Entry Certificates and has
delivered such instructions to the Owner Trustee.
Section 3.12. Notices to Clearing Agency. So long as any Book-Entry
Certificates are outstanding, whenever a notice or other communication to a
Certificateholder is required under this Agreement, unless and until Definitive
Certificates shall have been issued to Certificate Owners pursuant to Section
3.13, the Owner Trustee shall give all such notices and communications specified
herein to be given to Certificateholders to the Clearing Agency, and shall have
no obligations to the Certificate Owners.
Section 3.13. Definitive Certificates. So long as any Book-Entry
Certificates are outstanding, if (i) the Clearing Agency is no longer willing or
able to properly discharge its responsibilities with respect to the Book-Entry
Certificates and the Issuer is unable to locate a qualified successor, (ii) the
Issuer at its option advises the Owner Trustee in writing that it elects to
terminate the book-entry system through the Clearing Agency or (iii) after the
occurrence of an Event of Default under the Indenture or an Event of Servicer
Default under the Sale and Servicing Agreement, Certificate Owners representing
beneficial interests aggregating at least a majority of the Voting Rights advise
the Clearing Agency in writing that the continuation of a book-entry system
through the Clearing Agency is no longer in the best interest of the Certificate
Owners, then the Clearing Agency shall notify all Certificate Owners and the
Owner Trustee of the occurrence of any such event and of the availability of the
Definitive Certificates to Certificate Owners requesting the same. Upon
surrender to the Owner Trustee of the typewritten Certificate or Certificates
representing the Book-Entry Certificates by the Clearing Agency, accompanied by
registration instructions, the Owner Trustee shall execute and authenticate the
Definitive Certificates in accordance with the instructions of the Clearing
Agency. Neither the Certificate Registrar nor the Owner Trustee shall be liable
for any delay in delivery of such instructions and may conclusively rely on, and
shall be protected in relying on, such instructions. Upon the issuance of
Definitive Certificates, the Owner Trustee shall recognize the Holders of the
Definitive Certificates as Certificateholders. The Definitive Certificates shall
be issued in definitive, fully registered form and shall be printed,
lithographed or engraved or produced in any other manner as is reasonably
acceptable to the Owner Trustee, as evidenced by its execution thereof.
ARTICLE FOUR
ACTIONS BY OWNER TRUSTEE
Section 4.01. Prior Notice to Owners with Respect to Certain Matters.
(a) With respect to the following matters, the Owner Trustee shall not take
action unless at least 30 days before the taking of such action, the Owner
Trustee shall have notified the Certificateholders [and the Note Insurer] in
writing of the proposed action and [(i) the Note Insurer shall have consented
thereto and (ii)] the Owners shall not have notified the Owner Trustee in
writing prior to the 30th day after such notice is given that such Owners have
withheld consent or, [with the consent of the Note Insurer,] provided
alternative direction:
(i) the initiation of any claim or lawsuit by the Trust
(except claims or lawsuits brought in connection with the collection of
the Mortgage Loans) and the compromise of any action, claim or lawsuit
brought by or against the Trust (except with respect to the
aforementioned claims or lawsuits for collection of the Mortgage
Loans);
(ii) the election by the Trust to file an amendment to the
Certificate of Trust [(unless such amendment is required to be filed
under the Business Trust Statute)];
(iii) the amendment or other change to this Agreement or any
Basic Document;
(iv) the appointment pursuant to the Indenture of a successor
Note Registrar, Paying Agent or Indenture Trustee or pursuant to this
Agreement of a successor Certificate Registrar, or the consent to the
assignment by the Note Registrar, Paying Agent or Indenture Trustee or
Certificate Registrar of its obligations under the Indenture or this
Agreement, as applicable;
(v) the consent to the calling or waiver of any default
of any Basic Document;
(vi) except as provided in Article Nine hereof, the
dissolution, termination or liquidation of the Trust in whole or in
part;
(vii) the merger or consolidation of the Trust with or into
any other entity, or conveyance or transfer of all or substantially all
of the Trust's assets to any other entity;
(viii) causing the Trust to incur, assume or guaranty any
indebtedness other than as set forth in this Agreement;
(ix) doing any act that conflicts with any other Basic
Document;
(x) doing any act which would make it impossible to carry on
the ordinary business of the Trust as described in Section 2.03 hereof;
(xi) the confession of a judgment against the Trust;
(xii) the possession of Trust assets, or assignment of the
Trust's right to property, for other than a Trust purpose;
(xiii) causing the Trust to lend any funds to any entity; or
(xiv) the change of the Trust's purpose and powers from those
set forth in this Trust Agreement.
(b) The Owner Trustee on behalf of the Trust agrees to abide by the
following restrictions:
(i) other than as contemplated by the Basic Documents
and related documentation, the Trust shall not incur any indebtedness;
(ii) other than as contemplated by the Basic Documents and
related documentation, the Trust shall not engage in any dissolution,
liquidation, consolidation, merger or sale of assets;
(iii) the Trust shall not engage in any business activity in
which it is not currently engaged other than as contemplated by the
Basic Documents and related documentation;
(iv) the Trust shall not form, or cause to be formed, any
subsidiaries and shall not own or acquire any asset other than as
contemplated by the Basic Documents and related documentation; and
(v) other than as contemplated by the Basic Documents and
related documentation, the Trust shall not follow the directions or
instructions of the Depositor.
(c) The Owner Trustee on behalf of the Trust shall:
(i) maintain books and records separate from any other
person or entity;
(ii) maintain its office and bank accounts separate from any
other person or entity;
(iii) not commingle its assets with those of any other person
or entity;
(iv) conduct its own business in its own name;
(v) other than as contemplated by the Basic Documents and
related documentation, pay its own liabilities and expenses only out of
its own funds;
(vi) [observe all formalities required under the Business
Trust Statute];
(vii) not guarantee or become obligated for the debts of any
other person or entity;
(viii) not hold out its credit as being available to satisfy
the obligation of any other person or entity;
(ix) not acquire the obligations or securities of its
Affiliates or the Seller;
(x) other than as contemplated by the Basic Documents and
related documentation, not make loans to any other person or entity or
buy or hold evidence of indebtedness issued by any other person or
entity;
(xi) other than as contemplated by the Basic Documents and
related documentation, not pledge its assets for the benefit of any
other person or entity;
(xii) hold itself out as a separate entity from the Depositor
and not conduct any business in the name of the Depositor;
(xiii) correct any known misunderstanding regarding its
separate identity; and
(xiv) not identify itself as a division of any other person or
entity.
So long as the Notes or any other amounts owed under the Indenture
remain outstanding, the Trust shall not amend this Section 4.01 without the
prior written consent of [the Note Insurer and] 100% of the Voting Interests of
the Notes and the consent of each Rating Agency, in addition to the requirements
under Section 11.01.
(d) The Owner Trustee shall not have the power, except upon the
direction of the Owners [and the Note Insurer] and, subject to Section 11.18 of
the Indenture, 100% of the Noteholders, and to the extent otherwise consistent
with the Basic Documents, to (i) remove or replace the Servicer or the Indenture
Trustee.
Section 4.02. Action by Owners with Respect to Certain Matters. The
Owner Trustee shall not have the power, except upon the direction of the Owners
[and the Note Insurer], to (a) remove the Administrator under the Administration
Agreement pursuant to Section 8 thereof, (b) appoint a successor Administrator
pursuant to Section 8 of the Administration Agreement, (c) remove the Servicer
under the Sale and Servicing Agreement pursuant to Section 7.01 thereof, or (d)
except as expressly provided in the Basic Documents, sell the Mortgage Loans
after the termination of the Indenture. The Owner Trustee shall take the actions
referred to in the preceding sentence only upon written instructions signed by
the Owners [and the Note Insurer], but only to the extent expressly permitted in
the Basic Documents.
Section 4.03. Action with Respect to Bankruptcy.
(a) The Trust shall not, without prior written consent of the Owner
Trustee, (i) institute any proceedings to adjudicate the Trust a bankrupt or
insolvent, (ii) consent to the institution of bankruptcy or insolvency
proceedings against the Trust, (iii) file a petition seeking or consenting to
reorganization or relief under any applicable federal or state law relating to
bankruptcy with respect to the Trust, (iv) consent to the appointment of a
receiver, liquidator, assignee, trustee, sequestrator (or other similar
official) of the Trust or a substantial part of its property, (v) make any
assignment for the benefit of the Trust's creditors; (vi) cause the Trust to
admit in writing its inability to pay its debts generally as they become due; or
(vii) take any action in furtherance of any of the foregoing (any of the above
foregoing actions, a "Bankruptcy Action"). In considering any Bankruptcy Action,
the Owner Trustee, with consent of the Certificateholders (which consent the
Certificateholders believe to be the best interest of Certificateholders and the
Trust), shall at all times consider the interests of creditors of the Trust in
addition to the interests of the Trusts and whether the Trust is insolvent. The
Owner Trustee shall not be liable to any Certificateholder on account of the
Owner Trustee's good faith reliance on the provisions of this Section and no
Certificateholder shall have any claim for breach of fiduciary duty or otherwise
against the Owner Trustee for failing to take any Bankruptcy Action.
(b) No Certificateholder has power to commence any Bankruptcy Action on
the part of the Trust or to direct the Owner Trustee to take any Bankruptcy
Action on the part of the Trust. To the extent permitted by applicable law, the
consent of [the Note Insurer and] the Indenture Trustee shall be obtained prior
to taking any Bankruptcy Action.
(c) The provisions of this Section do not constitute an acknowledgment
or admission by the Owner Trustee, any Certificateholder or any creditor of the
Trust that the Trust is eligible to be a debtor under the United States
Bankruptcy Code, 11 U.S.C. ss.ss. 101 et seq., as amended.
Section 4.04. Restrictions on Owners' Power. The Owners shall not
direct the Owner Trustee to take or to refrain from taking any action if such
action or inaction would be contrary to any obligation of the Trust or the Owner
Trustee under this Agreement or any of the Basic Documents or would be contrary
to Section 2.03, nor shall the Owner Trustee be obligated to follow any such
direction, if given.
Section 4.05. Majority Control. Except as expressly provided herein,
any action that may be taken by the Owners under this Agreement may be taken by
the Holders of Certificates evidencing not less than a majority of the Aggregate
Voting Interests of all of the Certificates. Except as expressly provided
herein, any written notice of the Owners delivered pursuant to this Agreement
shall be effective if signed by Holders of Certificates evidencing not less than
a majority of the Aggregate Voting Interests of all of the Certificates at the
time of the delivery of such notice.
ARTICLE FIVE
APPLICATION OF TRUST FUNDS; CERTAIN DUTIES
Section 5.01. Certificate Distribution Account. All of the right, title
and interest of the Trust in all funds on deposit from time to time in the
Certificate Distribution Account and in all proceeds thereof shall be held for
the benefit of the Owners and such other persons entitled to distributions
therefrom. Except as otherwise expressly provided herein or in the Sale and
Servicing Agreement, the Certificate Distribution Account shall be under the
sole dominion and control of the Trust for the benefit of the Owners.
The Certificate Distribution Account shall be subject to and
established and maintained in accordance with the applicable provisions of the
Sale and Servicing Agreement, including, without limitation, the provisions of
Sections 6.01, 6.02 and 6.05 thereof.
Section 5.02. Application of Trust Funds. (a) On each Distribution
Date, the Paying Agent shall distribute to the Certificateholders from amounts
on deposit in the Certificate Distribution Account the distributions provided in
Section 6.05 of the Sale and Servicing Agreement with respect to such
Distribution Date. All distributions of interest or principal on any Class of
Certificates other than the Residual Interest Certificates, and all
distributions of amounts due on or in respect of the Residual Interest
Certificates, shall be made pro rata to the Certificateholders of such Class
entitled thereto.
(b) On each Distribution Date, the Indenture Trustee shall send or
cause the Trust to send to each Certificateholder the statement or statements
provided to the Trust by the Servicer pursuant to Section 5.19 of the Sale and
Servicing Agreement with respect to such Distribution Date.
(c) In the event that any withholding tax is imposed on the Trust's
payment (or allocations of income) to an Owner, such tax shall reduce the amount
otherwise distributable to the Owner in accordance with this Section. The Trust
is hereby authorized and directed to direct the Paying Agent to retain from
amounts otherwise distributable to the Owners sufficient funds for the payment
of any tax that is legally owed by the Trust (but such authorization shall not
prevent the Trust from contesting any such tax in appropriate proceedings and
withholding payment of such tax, if permitted by law, pending the outcome of
such proceedings). The amount of any withholding tax imposed with respect to an
Owner shall be treated as cash distributed to such Owner at the time it is
withheld by the Trust and remitted to the appropriate taxing authority. If the
amount withheld was not withheld from actual distributions, the Trust may, at
its option, (i) require the Owner to reimburse the Trust for such withholding
(and each Owner agrees to reimburse the Trust promptly following such request)
or (ii) reduce any subsequent distributions by the amount of such withholding.
If there is a possibility that withholding tax is payable with respect to a
distribution (such as a distribution to a non-U.S. Owner), the Trust may in its
sole discretion direct the Paying Agent to withhold such amounts in accordance
with this paragraph (c). In the event that an Owner wishes to apply for a refund
of any such withholding tax, the Trust shall reasonably cooperate with such
Owner in making such claim so long as such Owner agrees to reimburse the Owner
Trustee for any out-of-pocket expenses incurred.
Section 5.03. Method of Payment. Subject to Section 9.01(d),
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 the Certificate Registrar appropriate
written instructions at least five Business Days prior to such Distribution
Date, or, if not, by check mailed to such Certificateholder at the address of
such holder appearing in the Certificate Register; provided, that, a
Certificateholder shall only be entitled to receive distributions by wire
transfer if such Certificateholder is the registered Holder of Certificates
having an initial aggregate principal amount equal to or in excess of $5,000,000
or a Percentage Interest equal to or in excess of 25%, and in all other cases by
check mailed to each such Certificateholder at such Holder's address appearing
in the Certificate Register.
Section 5.04. Segregation of Moneys; No Interest. Subject to Sections
5.01 and 5.02, moneys received by the Owner Trustee hereunder and deposited in
the Certificate Distribution Account will be segregated and shall be invested in
Permitted Investments at the direction of the Depositor. The Owner Trustee shall
not be liable for payment of any interest in respect of such moneys.
Section 5.05. Tax Administration. The Owner Trustee, upon instruction
from the Depositor, shall sign on behalf of the Trust the tax returns of the
Trust, including Internal Revenue Service Form 1041 as required for a grantor
trust, unless applicable law requires an Owner to sign such documents, in which
case such documents shall be signed by the Residual Interestholders. In
addition, the Owner Trustee shall deliver or shall cause to be delivered to the
Residual Interestholders such information, reports or statements as may be
required by the Code and applicable Treasury Regulations and as may be required
to enable the Residual Interestholders to prepare their federal and state income
tax returns. Consistent with the Trust's characterization for tax purposes as a
grantor trust, no federal income tax return shall be filed on behalf of the
Trust unless either (i) the Owner Trustee shall receive an Opinion of Counsel
that, based on a change in applicable law occurring after the date hereof, the
Code requires such a filing or (ii) the Internal Revenue Service shall determine
that the Trust is required to file such a return. In the event that the Trust is
required to file tax returns and applicable law requires an Owner to sign such
documents, the Owner Trustee shall prepare or shall cause to be prepared any tax
returns required to be filed by the Trust and shall remit such returns to the
Residual Interestholders (or if the Residual Interestholders no longer
beneficially own the Trust, the beneficial owner designated for such purpose by
the Residual Interestholders to the Owner Trustee in writing) at least five days
before such returns are due to be filed. The Residual Interestholders (or such
designee beneficial owner, as applicable) shall promptly sign such returns and
deliver such returns after signature to the Owner Trustee and the Owner Trustee
shall file or shall cause to have filed such returns with the appropriate tax
authorities. In no event shall the Owner Trustee or the Residual Interestholders
(or such designee beneficial owner, as applicable) be liable for any
liabilities, costs or expenses of the Trust or the Noteholders arising out of
the application of any tax law, including federal, state, foreign or local
income or excise taxes or any other tax imposed on or measured by income (or any
interest, penalty or addition with respect thereto or arising from a failure to
comply therewith) except for any such liability, cost or expense attributable to
any act or omission by the Owner Trustee or the Residual Interestholders (or
such designee owner, as applicable), as the case may be, in breach of its
obligations under this Agreement.
ARTICLE SIX
AUTHORITY AND DUTIES OF OWNER TRUSTEE
Section 6.01. General Authority. The Owner Trustee is authorized and
directed to execute and deliver or cause to be executed and delivered the Notes,
the Certificates and the Basic Documents to which the Trust is to be a party and
each certificate or other document attached as an exhibit to or contemplated by
the Basic Documents to which the Trust is to be a party and any amendment or
other agreement or instrument described in Article Three, in each case, in such
form as the Depositor shall approve, as evidenced conclusively by the Owner
Trustee's execution thereof, and, on behalf of the Trust, to direct the
Indenture Trustee to authenticate and deliver the Notes. In addition to the
foregoing, the Owner Trustee is authorized, but shall not be obligated, to take
all actions required of the Trust pursuant to the Basic Documents. The Owner
Trustee is further authorized from time to time to take such action as the
Administrator recommends with respect to the Basic Documents, provided that such
activities are consistent with the terms of the Basic Documents.
Section 6.02. General Duties. It shall be the duty of the Owner
Trustee:
(a) to discharge (or cause to be discharged) all of its
responsibilities pursuant to the terms of this Agreement and the Basic Documents
to which the Trust is a party and to administer the Trust in the interest of the
Owners, subject to the Basic Documents and in accordance with the provisions of
this Agreement. Notwithstanding the foregoing, the Owner Trustee shall be deemed
to have discharged its duties and responsibilities hereunder and under the Basic
Documents to the extent the Administrator has agreed in the Administration
Agreement to perform any act or to discharge any duty of the Owner Trustee or
the Trust hereunder or under any Basic Document, and the Owner Trustee shall not
be held liable for the default or failure of the Administrator to carry out its
obligations under the Administration Agreement; and
(b) to cooperate with the Depositor in obtaining and preserving (or
causing to be obtained and preserved) the Issuer's qualification to do business
in each jurisdiction in which such qualification is or shall be necessary to
protect the validity and enforceability of the Indenture, the Notes the
Collateral and each other instrument and agreement included in the Trust Estate;
provided, however, that the Owner Trustee shall have no obligation to determine
whether and to what extent such qualification shall be necessary; and provided,
further, that the Owner Trustee shall only be required to take action under this
Section 6.02(b) if authorized and directed in writing to do so by the Depositor.
Section 6.03. Action upon Instruction. (a) Subject to this Agreement
and in accordance with the terms of the Basic Documents, the Owners may by
written instruction direct the Owner Trustee in the management of the Trust but
only to the extent consistent with the limited purpose of the Trust. Such
direction may be exercised at any time by written instruction of the Owners
pursuant to Article Four.
(b) The Owner Trustee shall not be required to take any action
hereunder or under any Basic Document if the Owner Trustee shall have reasonably
determined, or shall have been advised by counsel, that such action is likely to
result in liability on the part of the Owner Trustee or is contrary to the terms
hereof or of any Basic Document or is otherwise contrary to law.
(c) Whenever the Owner Trustee is unable to decide between alternative
courses of action permitted or required by the terms of this Agreement or under
any Basic Document, the Owner Trustee shall promptly give notice (in such form
as shall be appropriate under the circumstances) to the Owners [and the Note
Insurer] requesting instruction as to the course of action to be adopted, and to
the extent the Owner Trustee acts in good faith in accordance with any written
instruction of the Owners, [with the prior written consent of the Note Insurer,]
the Owner Trustee shall not be liable on account of such action to any Person.
If the Owner Trustee shall not have received appropriate instruction within 10
days of such notice (or within such shorter period of time as reasonably may be
specified in such notice or may be necessary under the circumstances) it may,
but shall be under no duty to, take or refrain from taking such action not
inconsistent with this Agreement or the Basic Documents, as it shall deem to be
in the best interests of the Owners, and, subject to Section 7.01, shall have no
liability to any Person for such action or inaction.
(d) In the event that the Owner Trustee is unsure as to the application
of any provision of this Agreement or any Basic Document or any such provision
is ambiguous as to its application, or is, or appears to be, in conflict with
any other applicable provision, or in the event that this Agreement permits any
determination by the Owner Trustee or is silent or is incomplete as to the
course of action that the Owner Trustee is required to take with respect to a
particular set of facts, the Owner Trustee may give notice (in such form as
shall be appropriate under the circumstances) to the Owners [and the Note
Insurer] requesting instruction and, to the extent that the Owner Trustee acts
or refrains from acting in good faith in accordance with any such instruction
received from [the Note Insurer or, with the prior consent of the Note Insurer,]
the Owners, the Owner Trustee shall not be liable, on account of such action or
inaction, to any Person. If the Owner Trustee shall not have received
appropriate instruction within 10 days of such notice (or within such shorter
period of time as reasonably may be specified in such notice or may be necessary
under the circumstances) it may, but shall be under no duty to, take or refrain
from taking such action not inconsistent with this Agreement or the Basic
Documents, as it shall deem to be in the best interests of the Owners, and,
subject to Section 7.01, shall have no liability to any Person for such action
or inaction.
Section 6.04. No Duties Except as Specified in this Agreement or in
Instructions. The Owner Trustee shall not have any duty or obligation to manage,
make any payment with respect to, register, record, sell, dispose of, or
otherwise deal with the Trust Estate, or to otherwise take or refrain from
taking any action under, or in connection with, any document contemplated hereby
to which the Owner Trustee is a party, except as expressly provided by the terms
of this Agreement, any Basic Document or in any document or written instruction
received by the Owner Trustee pursuant to Section 6.03; and no implied duties or
obligations shall be read into this Agreement or any Basic Document against the
Owner Trustee. The Owner Trustee shall have no responsibility for filing any
financing or continuation statement in any public office at any time or to
otherwise perfect or maintain the perfection of any security interest or lien
granted to it hereunder or to record this Agreement or any Basic Document. The
Owner Trustee nevertheless agrees that it will, at its own cost and expense,
promptly take all action as may be necessary to discharge any liens on any part
of the Trust Estate that result from actions by, or claims against, the Owner
Trustee solely in its individual capacity that are not related to the ownership
or the administration of the Trust Estate.
Section 6.05. No Action Except Under Specified Documents or
Instructions. The Owner Trustee shall not manage, control, use, sell, dispose of
or otherwise deal with any part of the Trust Estate except (i) in accordance
with the powers granted to and the authority conferred upon the Owner Trustee
pursuant to this Agreement, (ii) in accordance with the Basic Documents and
(iii) in accordance with any document or instruction delivered to the Owner
Trustee pursuant to Section 6.03.
Section 6.06. Restrictions. The Owner Trustee shall not take any action
(a) that is inconsistent with the purposes of the Trust set forth in Section
2.03 or (b) that, to the actual knowledge of the Owner Trustee, would result in
the Trust's becoming taxable as a corporation for federal income tax purposes.
The Owners shall not direct the Owner Trustee to take action that would violate
the provisions of this Section.
ARTICLE SEVEN
CONCERNING THE OWNER TRUSTEE
Section 7.01. Acceptance of Trusts and Duties. The Owner Trustee
accepts the trusts hereby created and agrees to perform its duties hereunder
with respect to such trusts, but only upon the terms of this Agreement and the
Basic Documents. The Owner Trustee also agrees to disburse all moneys actually
received by it constituting part of the Trust Estate upon the terms of the Basic
Documents and this Agreement. The Owner Trustee, in its capacity as Owner
Trustee, shall not be answerable or accountable hereunder or under any Basic
Document under any circumstances, except (i) for its own willful misconduct,
negligence or bad faith or (ii) in the case of the inaccuracy of any
representation or warranty contained in Section 7.03 expressly made by the Owner
Trustee in its individual capacity. In particular, but not by way of limitation
(and subject to the exceptions set forth in the preceding sentence):
(a) The Owner Trustee shall not be liable for any error of judgment
made in good faith by a Trust Officer of the Owner Trustee;
(b) The Owner Trustee shall not be liable with respect to any action
taken or omitted to be taken by it in accordance with the instructions of the
Administrator or any Owner;
(c) No provision of this Agreement or any Basic Document shall require
the Owner Trustee to expend or risk funds or otherwise incur any financial
liability in the performance of any of its rights or powers hereunder or under
any Basic Document if the Owner Trustee shall have reasonable grounds for
believing that repayment of such funds or adequate indemnity against such risk
or liability is not reasonably assured or provided to it;
(d) Under no circumstances shall the Owner Trustee be liable for
indebtedness evidenced by or arising under any of the Basic Documents, including
the principal of and interest on the Notes;
(e) The Owner Trustee shall not be responsible for or in respect of the
validity or sufficiency of this Agreement or for the due execution hereof by the
Depositor, for the form, character, genuineness, sufficiency, value or validity
of any of the 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 the Owner Trustee shall in no event assume or incur any
liability, duty or obligation to any Noteholder or to any Owner, other than as
expressly provided for herein or expressly agreed to in the Basic Documents;
(f) The Owner Trustee shall not be liable for the default or misconduct
of the Administrator, the Servicer, the Depositor or the Indenture Trustee under
any of the Basic Documents or otherwise, and the Owner Trustee shall have no
obligation or liability to perform the obligations of the Trust under this
Agreement or the Basic Documents that are required to be performed by the
Administrator under the Administration Agreement, the Indenture Trustee under
the Indenture or the Seller, the Depositor, the Servicer or the Indenture
Trustee under the Sale and Servicing Agreement; and
(g) The Owner Trustee shall be under no obligation to exercise any of
the rights or powers vested in it by this Agreement, or to institute, conduct or
defend any litigation under this Agreement or otherwise or in relation to this
Agreement or any Basic Document, at the request, order or direction of any of
the Owners, unless such Owners have offered to the Owner Trustee reasonable
security or indemnity satisfactory to it against the costs, expenses and
liabilities that may be incurred by the Owner Trustee therein or thereby
(provided, that if an Owner is an institutional investor with a rating of at
least investment grade from a nationally recognized statistical rating
organization (or nominee of such institutional investor), the unsecured
agreement of indemnity of such institutional investor shall be deemed
satisfactory for such purpose). The right of the Owner Trustee to perform any
discretionary act enumerated in this Agreement or in any Basic Document shall
not be construed as a duty, and the Owner Trustee shall not be answerable for
other than its negligence, bad faith or willful misconduct in the performance of
any such act.
Section 7.02. Furnishing of Documents. The Owner Trustee shall furnish
to the Owners [and the Note Insurer] promptly upon receipt of a written request
therefor, duplicates or copies of all reports, notices, requests, demands,
certificates, financial statements and any other instruments furnished to the
Owner Trustee under the Basic Documents.
Section 7.03. Representations and Warranties. (a) The Owner Trustee
hereby represents and warrants to the Depositor and the Note Insurer, for the
benefit of the Owners, that:
(i) The Owner Trustee is a banking corporation duly organized
and validly existing in good standing under the laws of the State of [
] [United States of America]. It has all requisite corporate power and
authority to execute, deliver and perform its obligations under this
Agreement.
(ii) The Owner Trustee 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.
(iii) Neither the execution or the delivery by it of this
Agreement, nor the consummation by it of the transactions contemplated
hereby, nor compliance by it with any of the terms or provisions hereof
will contravene any federal or [ ] law, governmental rule or regulation
governing the banking or trust powers of the Owner Trustee or any
judgment or order binding on it, or constitute any default under its
charter documents or bylaws or any indenture, mortgage, contract,
agreement or instrument to which it is a party or by which any of its
properties may be bound.
(iv) The execution, delivery, authentication and performance
by it of this Agreement will not require the authorization, consent or
approval of, the giving of notice to, the filing or registration with,
or the taking of any other action with respect to, any governmental
authority or agency.
(v) This Agreement, assuming due authorization, execution and
delivery by the Depositor, constitutes a valid, legal and binding
obligation of the Owner Trustee, enforceable against it in accordance
with the terms hereof subject to applicable bankruptcy, insolvency,
reorganization, moratorium and other laws affecting the enforcement of
creditors' rights generally and to general principles of equity,
regardless of whether such enforcement is considered in a proceeding in
equity or at law.
(vi) The Owner Trustee is not in default with respect to any
order or decree of any court or any order, regulation or demand of any
federal, state, municipal or governmental agency, which default might
have consequences that would materially and adversely affect the
condition (financial or other) or operations of the Owner Trustee or
its properties or might have consequences that would materially
adversely affect its performance hereunder.
(vii) No litigation is pending or, to the best of the Owner
Trustee's knowledge, threatened against the Owner Trustee which would
prohibit its entering into this Agreement or performing its obligations
under this Agreement.
Section 7.04. Reliance; Advice of Counsel. (a) Except as provided in
Section 7.01, the Owner Trustee shall incur no liability to anyone in acting
upon any signature, instrument, notice, resolution, request, consent, order,
certificate, report, opinion, bond, or other document or paper believed by it to
be genuine and believed by it to be signed by the proper party or parties. The
Owner Trustee may accept a certified copy of a resolution of the board of
directors or other governing body of any corporate party as conclusive evidence
that such resolution has been duly adopted by such body and that the same is in
full force and effect. As to any fact or matter the method of determination of
which is not specifically prescribed herein, the Owner Trustee may for all
purposes hereof rely on a certificate, signed by the president or any vice
president or by the treasurer or other authorized officers of the relevant
party, as to such fact or matter, and such certificate shall constitute full
protection to the Owner Trustee for any action taken or omitted to be taken by
it in good faith in reliance thereon.
(b) In the exercise or administration of the trusts hereunder and in
the performance of its duties and obligations under this Agreement or the Basic
Documents, the Owner Trustee (i) may act directly or through its agents or
attorneys pursuant to agreements entered into with any of them, and the Owner
Trustee shall not be liable for the conduct or misconduct of such agents or
attorneys if such agents or attorneys shall have been selected by the Owner
Trustee with reasonable care, and (ii) may consult with counsel, accountants and
other skilled Persons to be selected with reasonable care and employed by it.
Except as provided in Section 7.01, the Owner Trustee shall not be liable for
anything done, suffered or omitted in good faith by it in accordance with the
written opinion or advice of any such counsel, accountants or other such Persons
and not contrary to this Agreement or any Basic Document.
Section 7.05. Not Acting in Individual Capacity. Except as provided in
this Agreement, 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 the Owner Trustee by reason of the transactions contemplated by
this Agreement or any Basic Document shall look only to the Trust Estate for
payment or satisfaction thereof.
Section 7.06. Owner Trustee Not Liable for Certificates or Mortgage
Loans. The recitals contained herein and in the Certificates (other than the
signature and countersignature of the Owner Trustee on the Certificates) shall
be taken as the statement of the Depositor, and the Owner Trustee assumes no
responsibility for the correctness thereof. The Owner Trustee makes no
representations as to the validity or sufficiency of this Agreement, of any
Basic Document or of the Certificates (other than the signature and
countersignature of the Owner Trustee on the Certificates and as specified in
Section 7.03) or the Notes, or of the Mortgage Loans or related documents. The
Owner Trustee shall at no time have any liability for or with respect to the
legality, validity and enforceability of any Collateral or the perfection and
priority of any security interest created by any Collateral or the maintenance
of any such perfection and priority, or for or with respect to the sufficiency
of the Trust Estate or its ability to generate the payments to be distributed to
Certificateholders under this Agreement or the Noteholders under the Indenture,
including, without limitation: the existence, condition and ownership of any
Collateral; the existence and enforceability of any insurance thereon; the
existence and contents of any Collateral on any computer or other record
thereof; the validity of the assignment of any Collateral to the Trust or of any
intervening assignment; the performance or enforcement of any Collateral; the
compliance by the Depositor or the Servicer with any warranty or representation
made under any Basic Document or in any related document or the accuracy of any
such warranty or representation, or any action of the Administrator, the
Indenture Trustee, the Servicer or any subservicer taken in the name of the
Owner Trustee.
Section 7.07. Owner Trustee May Own Certificates and Notes. The Owner
Trustee in its individual or any other capacity may become the owner or pledgee
of Certificates or Notes and may deal with the Depositor, the Administrator, the
Indenture Trustee and the Servicer in banking transactions with the same rights
as it would have if it were not Owner Trustee.
Section 7.08. Doing Business in Other Jurisdictions. Notwithstanding
anything contained herein to the contrary, [ ] shall not be required to take any
action in any jurisdiction other than in the State of [ ] if the taking of such
action will (i) require the consent or approval or authorization or order of or
the giving of notice to, or the registration with or the taking of any other
action in respect of, any state or other governmental authority or agency of any
jurisdiction other than the State of [ ]; (ii) result in any fee, tax or other
governmental charge under the laws of any jurisdiction or any political
subdivisions thereof in existence on the date hereof other than the State of [ ]
becoming payable by [ ]; or (iii) subject [ ] to personal jurisdiction in any
jurisdiction other than the State of [ ] for causes of action arising from acts
unrelated to the consummation of the transactions by [ ] contemplated hereby.
The Owner Trustee shall be entitled to obtain advice of counsel to determine
whether any action required to be taken pursuant to the Agreement results in the
consequences described in clauses (i), (ii) and (iii) of the preceding sentence.
In the event that said counsel advises the Owner Trustee that such action will
result in such consequences, the Owner Trustee will appoint an additional
trustee pursuant to Section 10.05 to proceed with such action.
Section 7.09. Licenses. The Owner Trustee shall cooperate with the
Depositor in causing the Trust to use its best efforts to obtain and maintain
the effectiveness of any licenses required in connection with this Agreement and
the Basic Documents and the transactions contemplated hereby and thereby until
such time as the Trust shall terminate in accordance with the terms hereof;
provided, however, that the Owner Trustee shall have no obligation to determine
whether and to what extent such licensing shall be necessary; and provided,
further, that the Owner Trustee shall only be required to take action under this
Section 7.09 if authorized and directed in writing to do so by the Depositor.
Section 7.10. Liability of Certificate Registrar and Paying Agent. All
provisions affording protection to or limiting the liability of the Owner
Trustee shall inure as well to the Certificate Registrar and Paying Agent.
ARTICLE EIGHT
COMPENSATION OF OWNER TRUSTEE
Section 8.01. Owner Trustee's Fees and Expenses. The Owner Trustee
shall receive as compensation for its services hereunder such fees as are set
forth in the Fee Letter Agreement between the Seller and the Owner Trustee
attached hereto as Exhibit F, and the Owner Trustee shall be entitled to be
reimbursed for such fees and expenses as are set forth in the Fee Letter
Agreement as provided in the Sale and Servicing Agreement.
Section 8.02. Indemnification. The Seller shall be liable as primary
obligor for, and shall indemnify the Owner Trustee and its successors, assigns,
agents and servants (collectively, the "Indemnified Parties") from and against,
any and all liabilities, obligations, losses, damages, taxes, claims, actions
and suits, and any and all reasonable costs, expenses and disbursements
(including reasonable legal fees and expenses) of any kind and nature whatsoever
(collectively, "Expenses") which may at any time be imposed on, incurred by, or
asserted against the Owner Trustee or any Indemnified Party in any way relating
to or arising out of this Agreement, the Basic Documents, the Trust Estate, the
administration of the Trust Estate or the action or inaction of the Owner
Trustee hereunder, except only that the Seller shall not be liable for or
required to indemnify an Indemnified Party from and against Expenses arising or
resulting from any of the matters described in the third sentence of Section
7.01, (ii) with respect to any such claim, the Indemnified Party shall have
given the Seller written notice thereof, (iii) while maintaining control over
its own defense, the Seller shall consult with the Indemnified Party in
preparing such defense, and (iv) notwithstanding anything in this Agreement to
the contrary, the Seller shall not be liable for settlement of any claim by an
Indemnified Party entered into without the prior consent of the Seller which
consent shall not be reasonably withheld. The indemnities contained in this
Section shall survive the resignation or termination of the Owner Trustee or the
termination of this Agreement. In any event of any claim, action or proceeding
for which indemnity will be sought pursuant to this Section, the Owner Trustee's
choice of legal counsel shall be subject to the approval of the Seller, which
approval shall not be unreasonably withheld. In addition, upon written notice to
the Owner Trustee and with the consent of the Owner Trustee, which consent shall
not be unreasonably withheld, the Seller has the right to assume the defense of
any claim, action or proceeding against the Owner Trustee; provided, however,
that the Seller shall not be entitled to assume the defense of any such claim,
action or proceeding if such claim, action or proceeding involves a possible
imposition of criminal liability or penalty or a material civil penalty on the
Owner Trustee, a conflict of interest between the Owner Trustee and the Seller
or another indemnitee or the granting of material injunctive relief against such
indemnitee, and the Owner Trustee informs the Seller that it desires to be
represented by separate counsel, in which case the reasonable fees and expenses
of such separate counsel shall be borne by the Seller.
Section 8.03. Payments to the Owner Trustee. Any amounts paid to the
Owner Trustee pursuant to this Article Eight shall be deemed not to be a part of
the Trust Estate immediately after such payment.
ARTICLE NINE
TERMINATION OF TRUST AGREEMENT
Section 9.01. Termination of Trust Agreement. (a) This Agreement (other
than Article Eight) shall terminate and the Trust shall dissolve, wind up and
terminate and be of no further force or effect upon the earlier of (i) the final
distribution by the Owner Trustee of all moneys or other property or proceeds of
the Trust Estate in accordance with the terms of the Indenture, the Sale and
Servicing Agreement and Article Five and the termination of the Indenture [and
the Insurance Agreement]; and (ii) the expiration of 21 years from the death of
the last survivor of the descendants of Joseph P. Kennedy (the late ambassador
of the United States to the Court of St. James's). The bankruptcy, liquidation,
dissolution, death or incapacity of any Owner shall not (x) operate to terminate
this Agreement or the Trust, (y) entitle such Owner's legal representatives or
heirs to claim an accounting or to take any action or proceeding in any court
for a partition or winding up of all or any part of the Trust or Trust Estate or
(z) otherwise affect the rights, obligations and liabilities of the parties
hereto.
(b) The Certificates shall be subject to early termination at the
option of the Majority Residual Interestholders in the manner and subject to the
provisions of Section 8.01 of the Sale and Servicing Agreement.
(c) Except as provided in Sections 9.01(a) and (b), none of the
Depositor or any Owner shall be entitled to revoke or terminate the Trust.
(d) Notice of any termination of the Trust, specifying the Distribution
Date upon which Certificateholders shall surrender their Certificates to the
Paying Agent for payment of the final distribution and cancellation, shall be
given by the Owner Trustee by letter to Certificateholders [and the Note
Insurer] mailed within five Business Days of receipt of notice of such
termination from the Majority Residual Interestholders, given pursuant to
Section 8.01 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 the
Paying Agent therein designated, (ii) the amount of any such final payment and
(iii) that the Record Date otherwise applicable to such Distribution Date is not
applicable, payments being made only upon presentation and surrender of the
Certificates at the office of the Paying Agent therein specified. The Owner
Trustee shall give such notice to the Certificate Registrar (if other than the
Owner Trustee) and the Paying Agent at the time such notice is given to
Certificateholders. Upon presentation and surrender of the Certificates, the
Paying Agent shall cause to be distributed to Certificateholders amounts
distributable on such Distribution Date pursuant to Section 6.05 of the Sale and
Servicing Agreement.
In the event that all of the Certificateholders shall not have
surrendered their Certificates for cancellation within six months after the date
specified in the above mentioned written notice, the Owner Trustee shall give a
second written notice to the remaining Certificateholders to surrender their
Certificates for cancellation and receive the final distribution with respect
thereto. If within one year after the second notice all the Certificates shall
not have been surrendered for cancellation, the Owner Trustee may take
appropriate steps, or may appoint an agent to take appropriate steps, to contact
the remaining Certificateholders concerning surrender of their Certificates, and
the cost thereof shall be paid out of the funds and other assets that shall
remain subject to this Agreement. Subject to applicable escheat laws, any funds
remaining in the Trust after exhaustion of such remedies shall be distributed by
the Owner Trustee to the Residual Interestholders on a pro rata basis.
(e) Upon the winding up of the Trust and its termination, the Owner
Trustee shall cause the Certificate of Trust to be cancelled by filing a
certificate of cancellation with the Secretary of State [in accordance with the
provisions of Section 3810(d) of the Business Trust Statute].
ARTICLE TEN
SUCCESSOR OWNER TRUSTEES AND ADDITIONAL OWNER TRUSTEES
Section 10.01. Eligibility Requirements for Owner Trustee. The Owner
Trustee shall at all times be [a corporation satisfying the provisions of
Section 3807(a) of the Business Trust Statute] [and] [reasonably acceptable to
the Note Insurer]; authorized to exercise corporate trust powers; having a
combined capital and surplus of at least $50,000,000 and subject to supervision
or examination by federal or state authorities; and having (or having a parent
that has) time deposits that are rated at least "F-1" or "P-1" (or the
equivalent) by each Rating Agency or are otherwise acceptable to each Rating
Agency. If such corporation shall publish reports of condition at least annually
pursuant to law or to the requirements of the aforesaid supervising or examining
authority, then for the purpose of this Section, the combined capital and
surplus of such corporation shall be deemed to be its combined capital and
surplus as set forth in its most recent report of condition so published. In
case at any time the Owner Trustee shall cease to be eligible in accordance with
the provisions of this Section, the Owner Trustee shall resign immediately in
the manner and with the effect specified in Section 10.02.
Section 10.02. Resignation or Removal of Owner Trustee. The Owner
Trustee may at any time resign and be discharged from the trusts hereby created
by giving 30 days' prior written notice thereof to the Administrator, [the Note
Insurer,] and the Indenture Trustee. Upon receiving such notice of resignation,
the Administrator shall promptly appoint a successor Owner Trustee [with the
consent of the Note Insurer] by written instrument, in duplicate, one copy of
which instrument shall be delivered to the resigning Owner Trustee and one copy
to the successor Owner Trustee. 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
[reasonably acceptable to the Note Insurer].
If at any time the Owner Trustee shall cease to be eligible in
accordance with the provisions of Section 10.01 and shall fail to resign after
written request therefor by the Administrator [or the Note Insurer], or if at
any time the Owner Trustee shall be legally unable to act, or shall be adjudged
bankrupt or insolvent, or a receiver of the Owner Trustee or of its property
shall be appointed, or any public officer shall take charge or control of the
Owner Trustee or of its property or affairs for the purpose of rehabilitation,
conservation or liquidation, then the Administrator may remove the Owner
Trustee. If the Administrator shall remove the Owner Trustee under the authority
of the immediately preceding sentence, the Administrator shall promptly appoint
a successor Owner Trustee [reasonably acceptable to the Note Insurer] by written
instrument, in duplicate, one copy of which instrument shall be delivered to the
outgoing Owner Trustee so removed and one copy to the successor Owner Trustee,
and shall pay all fees owed to the outgoing Owner Trustee.
Any resignation or removal of the Owner Trustee and appointment of a
successor Owner Trustee pursuant to any of the provisions of this Section shall
not become effective until acceptance of appointment by the successor Owner
Trustee pursuant to Section 10.03 and payment of all fees and expenses owed to
the outgoing Owner Trustee. The Administrator shall provide notice of such
resignation or removal of the Owner Trustee to each Rating Agency [and the Note
Insurer].
Section 10.03. Successor Owner Trustee. Any successor Owner Trustee
appointed pursuant to Section 10.02 shall execute, acknowledge and deliver to
the Depositor, [the Note Insurer,] the Administrator and to its predecessor
Owner Trustee an instrument accepting such appointment under this Agreement, and
thereupon the resignation or removal of the predecessor Owner Trustee shall
become effective, and such successor Owner Trustee, without any further act,
deed or conveyance, shall become fully vested with all the rights, powers,
duties and obligations of its predecessor under this Agreement, with like effect
as if originally named as Owner Trustee. The predecessor Owner Trustee shall
upon payment of its fees and expenses deliver to the successor Owner Trustee all
documents and statements and monies held by it under this Agreement; and the
Depositor, the Administrator and the predecessor Owner Trustee shall execute and
deliver such instruments and do such other things as may reasonably be required
for fully and certainly vesting and confirming in the successor Owner Trustee
all such rights, powers, duties and obligations.
No successor Owner Trustee shall accept appointment as provided in this
Section unless at the time of such acceptance such successor Owner Trustee shall
be eligible pursuant to Section 10.01.
Upon acceptance of appointment by a successor Owner Trustee pursuant to
this Section, the Administrator shall mail notice thereof to Certificateholders,
the Indenture Trustee, the Noteholders and each Rating Agency. If the
Administrator shall fail to mail such notice within 10 days after acceptance of
such appointment by the successor Owner Trustee, the successor Owner Trustee
shall cause such notice to be mailed at the expense of the Administrator.
Section 10.04. Merger or Consolidation of Owner Trustee. Any
corporation into which the Owner Trustee may be merged or converted or with
which it may be consolidated, or any corporation resulting from any merger,
conversion or consolidation to which the Owner Trustee shall be a party, or any
corporation succeeding to all or substantially all of the corporate trust
business of the Owner Trustee, shall be the successor of the Owner Trustee
hereunder, without the execution or filing of any instrument or any further act
on the part of any of the parties hereto, anything herein to the contrary
notwithstanding; provided, that such corporation shall be eligible pursuant to
Section 10.01; and, provided, further, that the Owner Trustee shall mail notice
of such merger or consolidation to each Rating Agency [and the Note Insurer].
Section 10.05. Appointment of Co-Trustee or Separate Trustee.
Notwithstanding any other provisions of this Agreement, at any time, for the
purpose of meeting any legal requirements of any jurisdiction in which any part
of the Trust Estate or any Collateral may at the time be located, the
Administrator and the Owner Trustee acting jointly shall have the power and
shall execute and deliver all instruments to appoint one or more Persons
approved by the Administrator, [the Note Insurer] and Owner Trustee to act as
co-trustee, jointly with the Owner Trustee, or as separate trustee or separate
trustees, of all or any part of the Trust Estate, and to vest in such Person, in
such capacity, such title to the Trust or any part thereof and, subject to the
other provisions of this Section, such powers, duties, obligations, rights and
trusts as the Administrator, [the Note Insurer] and the Owner Trustee may
consider necessary or desirable. If the Administrator shall not have joined in
such appointment within 15 days after the receipt by it of a request so to do,
the Owner Trustee alone shall have the power to make such appointment [with the
consent of the Note Insurer]. No co-trustee or separate trustee under this
Agreement shall be required to meet the terms of eligibility as a successor
Owner Trustee pursuant to Section 10.01 and no notice of the appointment of any
co-trustee or separate trustee shall be required pursuant to Section 10.03.
Each separate trustee and co-trustee shall, to the extent permitted by
law, be appointed and act subject to the following provisions and conditions:
(a) All rights, powers, duties and obligations conferred or imposed
upon the Owner Trustee shall be conferred upon and exercised or performed by the
Owner Trustee and such separate trustee or co-trustee jointly (it being
understood that such separate trustee or co-trustee is not authorized to act
separately without the Owner Trustee joining in such act), except to the extent
that under any law of any jurisdiction in which any particular act or acts are
to be performed, the Owner Trustee shall be incompetent or unqualified to
perform such act or acts, in which event such rights, powers, duties and
obligations (including the holding of title to the Trust Estate or any portion
thereof in any such jurisdiction) shall be exercised and performed singly by
such separate trustee or co-trustee, but solely at the direction of the Owner
Trustee;
(b) No trustee under this Agreement shall be personally liable by
reason of any act or omission of any other trustee under this Agreement; and
(c) The Administrator and the Owner Trustee acting jointly may at any
time accept the resignation of or remove any separate trustee or co-trustee.
Any notice, request or other writing given to the Owner Trustee shall
be deemed to have been given to each of the then separate trustees and
co-trustees, as effectively as if given to each of them. Every instrument
appointing any separate trustee or co-trustee shall refer to this Agreement and
the conditions of this Article. Each separate trustee and co-trustee, upon its
acceptance of the trusts conferred, shall be vested with the estates or property
specified in its instrument of appointment, either jointly with the Owner
Trustee or separately, as may be provided therein, subject to all the provisions
of this Agreement, specifically including every provision of this Agreement
relating to the conduct of, affecting the liability of, or affording protection
to, the Owner Trustee. Each such instrument shall be filed with the Owner
Trustee and a copy thereof given to the Administrator.
Any separate trustee or co-trustee may at any time appoint the Owner
Trustee as its agent or attorney-in-fact with full power and authority, to the
extent not prohibited by law, to do any lawful act under or in respect of this
Agreement on its behalf and in its name. If any separate trustee or co-trustee
shall die, become incapable of acting, resign or be removed, all of its estates,
properties, rights, remedies and trusts shall vest in and be exercised by the
Owner Trustee, to the extent permitted by law, without the appointment of a new
or successor co-trustee or separate trustee.
ARTICLE ELEVEN
MISCELLANEOUS
Section 11.01. Supplements and Amendments. This Agreement may be
amended by the Depositor and the Owner Trustee [with the prior written consent
of the Note Insurer], and with prior written notice to each Rating Agency,
without the consent of any of the Noteholders or the Certificateholders, to cure
any ambiguity, to correct or supplement any provisions in this Agreement or for
the purpose of adding any provisions to or changing in any manner or eliminating
any of the provisions in this Agreement or of modifying in any manner the rights
of the Noteholders or the Certificateholders; provided, however, that such
action shall not, as evidenced by an Opinion of Counsel, adversely affect in any
material respect the interests of any Noteholder or Certificateholder [or the
rights of the Note Insurer] or cause the Trust to be subject to an entity level
tax for federal income tax purposes. An amendment shall not be deemed to
adversely affect in any material respect the interests of any Noteholder or
Certificateholder and no opinion referred to in the preceding proviso shall be
required to be delivered if the Person requesting the amendment obtains a letter
from each Rating Agency stating that the amendment would not result in the
downgrading or withdrawal of the respective ratings then assigned to each Class
of Notes and Certificates. Notwithstanding the preceding sentence, an opinion
shall be required with respect to tax matters as set forth in this paragraph.
This Agreement may also be amended from time to time by the Depositor
and the Owner Trustee, with prior written notice to each Rating Agency, with the
consent of [the Note Insurer and] the Holders (as defined in the Indenture) of
Notes evidencing not less than 66 2/3% of the Aggregate Voting Interests of the
Notes and the consent of the Holders of Certificates evidencing not less than 66
2/3% of the Aggregate Voting Interests of the Certificates, for the purpose of
adding any provisions to or changing in any manner or eliminating any of the
provisions of this Agreement or of modifying in any manner the rights of the
Noteholders or the Certificateholders; provided, however, that no such amendment
shall (a) reduce in any manner the amount of, or accelerate or delay the timing
of, distributions that shall be required to be made for the benefit of the
Noteholders, [or] the Certificateholders [or the Note Insurer] or (b) reduce the
aforesaid percentage of the Outstanding Amount of the Notes and the Voting
Interests of the Certificates required to consent to any such amendment, without
the consent of the holders of all the outstanding Securities affected thereby
[and the Note Insurer]; and provided, however, that such action shall not, as
evidenced by an Opinion of Counsel, cause the Trust to be subject to an entity
level tax for federal income tax purposes.
Notwithstanding the foregoing, no provision of Sections 2.03 or 4.01
hereof may be amended in any manner unless (i) 100% of the Noteholders have
consented in writing thereto, (ii) the Rating Agencies [and the Note Insurer]
have consent in writing thereto or (iii) the Notes have been paid in full and
the Indenture has been discharged.
Promptly after the execution of any such amendment or consent, the
Owner Trustee shall furnish written notification of the substance of such
amendment or consent to each Certificateholder, the Indenture Trustee, [the Note
Insurer] and each Rating Agency.
It shall not be necessary for the consent of Certificateholders or
Noteholders pursuant to this Section to approve the particular form of any
proposed amendment or consent, but it shall be sufficient if such consent shall
approve the substance thereof. The manner of obtaining such consents (and any
other consents of Certificateholders provided for in this Agreement or in any
other Basic Document) and of evidencing the authorization of the execution
thereof by Certificateholders shall be subject to such reasonable requirements
as the Owner Trustee may prescribe.
Promptly after the execution of any amendment to the Certificate of
Trust, the Owner Trustee shall cause the filing of such amendment with the
Secretary of State.
Prior to the execution of any amendment to this Agreement or the
Certificate of Trust, the Owner Trustee [and the Note Insurer] shall be entitled
to receive and rely upon an Opinion of Counsel stating that the execution of
such amendment is authorized or permitted by this Agreement. The Owner Trustee
may, but shall not be obligated to, enter into any such amendment that affects
the Owner Trustee's own rights, duties or immunities under this Agreement or
otherwise.
In connection with the execution of any amendment to this Trust
Agreement or any amendment of any other agreement to which the Issuer is a
party, the Owner Trustee shall be entitled to receive and conclusively rely upon
an Opinion of Counsel to the effect that such amendment is authorized or
permitted by the Basic Documents and that all conditions precedent in the Basic
Documents for the execution and delivery thereof by the Issuer or the Owner
Trustee, as the case may be, have been satisfied.
Section 11.02. No Legal Title to Trust Estate in Owners. The Owners
shall not have legal title to any part of the Trust Estate. The Owners shall be
entitled to receive distributions with respect to their undivided ownership
interest therein only in accordance with Articles Five and Nine. No transfer, by
operation of law or otherwise, of any right, title or interest of the Owners to
and in their ownership interest in the 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 Trust
Estate.
Section 11.03. Limitations on Rights of Others. The provisions of this
Agreement are solely for the benefit of the Owner Trustee, the Depositor, the
Owners, [the Note Insurer,] the Administrator and, to the extent expressly
provided herein, the 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 Trust Estate or
under or in respect of this Agreement or any covenants, conditions or provisions
contained herein.
Section 11.04. Notices. (a) Unless otherwise expressly specified or
permitted by the terms hereof, all notices shall be in writing and shall be
deemed given upon receipt by the intended recipient (except that notice to the
Owner Trustee shall be deemed given only upon actual receipt by the Owner
Trustee), to the applicable address specified for each party [and the Note
Insurer] in the Sale and Servicing Agreement; 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 such notice
also shall be given to each Rating Agency in the manner described above. Any
notice so mailed within the time prescribed in this Agreement shall be
conclusively presumed to have been duly given when mailed, whether or not the
Certificateholder and each Rating Agency receives such notice.
Section 11.05. Severability. Any provision of this Agreement that is
prohibited or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof, and any
such prohibition or unenforceability in any jurisdiction shall not invalidate
or render unenforceable such provision in any other jurisdiction.
Section 11.06. Separate Counterparts. This Agreement may be executed
by the parties hereto in separate counterparts, each of which when so executed
and delivered shall be an original, but all such counterparts shall together
constitute but one and the same instrument.
Section 11.07. Successors and Assigns. All covenants and agreements
contained herein shall be binding upon, and inure to the benefit of, each of
the Depositor and its permitted assignees, the Owner Trustee and its
successors and each Owner and its successors and permitted assigns, all as
herein provided. Any request, notice, direction, consent, waiver or other
instrument or action by an Owner shall bind the successors and assigns of such
Owner.
Section 11.08. No Petition. (a) The Owner Trustee, by entering into
this Agreement, each Certificateholder, by accepting a Certificate, and the
Indenture Trustee and each Noteholder, by accepting the benefits of this
Agreement, hereby covenant and agree that they will not at any time institute
against the Depositor or the Trust, or join in any institution against the
Depositor or the Trust of, any bankruptcy proceedings under any United States
federal or state bankruptcy or similar law in connection with any obligations
relating to the Certificates, the Notes, this Agreement or any of the Basic
Documents.
(b) The Depositor shall not be liable for the default or misconduct
of the Administrator, the Owner Trustee, the Indenture Trustee, the Paying
Agent or the Servicer under any of the Basic Documents or otherwise and the
Depositor shall have no obligation or liability to perform the obligations of
the Trust under this Agreement or the Basic Documents that are required to be
performed by the Administrator under the Administration Agreement, the
Indenture Trustee under the Indenture or the Servicer under the Sale and
Servicing Agreement.
Section 11.09. No Recourse. Each Certificateholder by accepting a
Certificate acknowledges that such Certificateholder's Certificate represents
beneficial interests in the Trust only and do not represent interests in or
obligations of the Depositor, the Servicer, the Administrator, the Owner
Trustee, the Indenture Trustee or any Affiliate thereof and no recourse may be
had against such parties or their assets, except as may be expressly set forth
or contemplated in this Agreement, the Certificates or the 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. [Grant of Certificateholder Rights to Note Insurer.
(a) In consideration for the issuance of the Certificates and for the
guarantee of the Notes by the Note Insurer pursuant to the Insurance Policy, the
holders of the Certificates hereby grant to the Note Insurer the right to act as
the holder of 100% of the outstanding Certificates for the purpose of exercising
the rights of the Certificateholders under this Agreement without the consent of
the Certificateholders, including the voting rights of such holders hereunder,
but excluding those rights requiring the consent of all such holders under
Section 11.01 and any rights of such holders to distributions under Section
5.02(a); provided that the preceding grant of rights to the Note Insurer by the
holders of the Trust Interest shall be subject to Section 11.14.
(b) The rights of the Note Insurer to direct certain actions and
consent to certain actions of the Certificateholders hereunder will terminate at
such time as the Class Principal Amount of the Notes has been reduced to zero
and the Note Insurer has been reimbursed for any amounts owed under the
Insurance Policy and the Insurance Agreement and the Note Insurer has no further
obligation under the Insurance Policy.]
Section 11.13. [Third-Party Beneficiary.
The Note Insurer is an intended third-party beneficiary of this
Agreement, and this Agreement shall be binding upon and inure to the benefit of
the Note Insurer; provided that, notwithstanding the foregoing, for so long as a
Note Insurer Default is continuing with respect to its obligations under the
Note Insurance Policy, the Noteholders shall succeed to the Note Insurer's
rights hereunder. Without limiting the generality of the foregoing, all
covenants and agreements in this Agreement that expressly confer rights upon the
Note Insurer shall be for the benefit of and run directly to the Note Insurer,
and the Note Insurer shall be entitled to rely on and enforce such covenants to
the same extent as if it were a party to this Agreement.]
Section 11.14. [Suspension and Termination of Note Insurer's Rights.
During the continuation of a Note Insurer Default, rights granted or
reserved to the Note Insurer hereunder shall vest instead in the Owners;
provided that the Note Insurer shall be entitled to any distributions in
reimbursement of the Reimbursement Amount, and the Note Insurer shall retain
those rights under Section 11.01 to consent to any amendment of this Agreement.
At such time as either (i) the Class Principal Amount of the Notes has
been reduced to zero or (ii) the Insurance Policy has been terminated and in
either case of (i) or (ii) the Note Insurer has been reimbursed for all amounts
owed under the Insurance Policy and the Insurance Agreement (and the Note
Insurer no longer has any obligation under the Insurance Policy, except for
breach thereof by the Note Insurer), then the rights and benefits granted or
reserved to the Note Insurer hereunder (including the rights to direct certain
actions and receive certain notices) shall terminate and the Certificateholders
shall be entitled to the exercise of such rights and to receive such benefits of
the Note Insurer following such termination to the extent that such rights and
benefits are applicable to the Certificateholders.]
Section 11.15. [Fiduciary Obligation to Holders of the Certificates.
Nothing in this Agreement shall be construed or deemed to impair the
fiduciary obligation of the Owner Trustee to the Holders of the Certificates. In
acting in accordance with the direction of the Note Insurer pursuant to this
Agreement, the Owner Trustee shall not be deemed to (i) owe any fiduciary
obligation to the Note Insurer or (ii) to have violated any fiduciary obligation
or responsibility to the Holders of the Certificates.]
* * * * * *
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.
ACE SECURITIES CORP.,
as the Depositor
By:____________________________________
Name:
Title:
[ ],
in its individual capacity and as Owner Trustee
By:____________________________________
Name:
Title:
Accepted and Agreed to:
GERMAN AMERICAN CAPITAL CORPORATION
By:________________________________
Name:
Title:
By:________________________________
Name:
Title: