EXHIBIT 4.1
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TRUST AGREEMENT
between
WORLD OMNI AUTO RECEIVABLES LLC,
as Depositor,
and
[______________________],
as Owner Trustee
Dated as of [_______], [_______]
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TABLE OF CONTENTS
Page
ARTICLE I
Definitions
SECTION 1.01. Capitalized Terms.................................................................................1
SECTION 1.02. Other Definitional Provisions.....................................................................4
ARTICLE II
Organization
SECTION 2.01. Name..............................................................................................4
SECTION 2.02. Office............................................................................................5
SECTION 2.03. Purposes and Powers...............................................................................5
SECTION 2.04. Appointment of Owner Trustee......................................................................5
SECTION 2.05. Initial Capital Contribution of Owner Trust Estate................................................5
SECTION 2.06. Declaration of Trust..............................................................................6
SECTION 2.07. Liability of the Owners...........................................................................6
SECTION 2.08. Title to Trust Property...........................................................................6
SECTION 2.09. Situs of Trust....................................................................................7
SECTION 2.10. Representations and Warranties of the Depositor...................................................7
SECTION 2.11. Maintenance of the Demand Note....................................................................8
SECTION 2.12. Federal Income Tax Provisions.....................................................................8
ARTICLE III
Trust Certificates and Transfer of Interests
SECTION 3.01. Initial Ownership.................................................................................8
SECTION 3.02. The Trust Certificates............................................................................8
SECTION 3.03. Authentication of Trust Certificates..............................................................8
SECTION 3.04. Registration of Transfer and Exchange of Trust Certificates.......................................9
SECTION 3.05. Mutilated, Destroyed, Lost or Stolen Trust Certificates..........................................11
SECTION 3.06. Persons Deemed Owners............................................................................11
SECTION 3.07. Access to List of Certificateholders' Names and Addresses........................................11
SECTION 3.08. Maintenance of Office or Agency..................................................................12
SECTION 3.09. Appointment of Paying Agent......................................................................12
SECTION 3.10. Ownership by Depositor of Trust Certificates.....................................................12
SECTION 3.11. Book-Entry Trust Certificates....................................................................12
SECTION 3.12. Notices to Clearing Agency.......................................................................13
SECTION 3.13. Definitive Trust Certificates....................................................................13
ARTICLE IV
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.................................................15
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SECTION 4.03. Action by Owners with Respect to Bankruptcy......................................................15
SECTION 4.04. Restrictions on Owners' Power....................................................................15
SECTION 4.05. Majority Control.................................................................................15
ARTICLE V
Application of Trust Funds; Certain Duties
SECTION 5.01. Establishment of Trust Account...................................................................15
SECTION 5.02. Application of Trust Funds.......................................................................16
SECTION 5.03. Method of Payment................................................................................16
SECTION 5.04. No Segregation of Moneys; No Interest............................................................16
SECTION 5.05. Accounting and Reports to the Noteholders, Owners, the Internal Revenue Service
and Others..............................................................................16
SECTION 5.06. Signature on Returns.............................................................................17
ARTICLE VI
Authority and Duties of Owner Trustee
SECTION 6.01. General Authority................................................................................17
SECTION 6.02. General Duties...................................................................................17
SECTION 6.03. Action upon Instruction..........................................................................17
SECTION 6.04. No Duties Except as Specified in this Agreement or in Instructions...............................18
SECTION 6.05. No Action Except Under Specified Documents or Instructions.......................................18
SECTION 6.06. Restrictions.....................................................................................19
ARTICLE VII
Concerning the Owner Trustee
SECTION 7.01. Acceptance of Trusts and Duties..................................................................19
SECTION 7.02. Furnishing of Documents..........................................................................20
SECTION 7.03. Representations and Warranties...................................................................20
SECTION 7.04. Reliance; Advice of Counsel......................................................................21
SECTION 7.05. Not Acting in Individual Capacity................................................................21
SECTION 7.06. Owner Trustee Not Liable for Trust Certificates or Receivables...................................21
SECTION 7.07. Owner Trustee May Own Trust Certificates and Notes...............................................22
ARTICLE VIII
Compensation of Owner Trustee
SECTION 8.01. Owner Trustee's Fees and Expenses................................................................22
SECTION 8.02. Indemnification..................................................................................22
SECTION 8.03. Payments to the Owner Trustee....................................................................23
ARTICLE IX
Termination of Trust Agreement
SECTION 9.01. Termination of Trust Agreement...................................................................23
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SECTION 9.02. Dissolution upon Bankruptcy of the Depositor....................................................24
ARTICLE X
Successor Owner Trustees and Additional Owner Trustees
SECTION 10.01. Eligibility Requirements for Owner Trustee......................................................24
SECTION 10.02. Resignation or Removal of Owner Trustee.........................................................25
SECTION 10.03. Successor Owner Trustee.........................................................................25
SECTION 10.04. Merger or Consolidation of Owner Trustee........................................................26
SECTION 10.05. Appointment of Co-Trustee or Separate Trustee...................................................26
ARTICLE XI
Miscellaneous
SECTION 11.01. Supplements and Amendments......................................................................27
SECTION 11.02. No Legal Title to Owner Trust Estate in Owners..................................................28
SECTION 11.03. Limitations on Rights of Others.................................................................28
SECTION 11.04. Notices.........................................................................................29
SECTION 11.05. Severability....................................................................................29
SECTION 11.06. Separate Counterparts...........................................................................29
SECTION 11.07. Successors and Assigns..........................................................................29
SECTION 11.08. Covenants of the Depositor......................................................................29
SECTION 11.09. No Petition.....................................................................................30
SECTION 11.10. No Recourse.....................................................................................30
SECTION 11.11. Headings........................................................................................30
SECTION 11.12. Governing Law...................................................................................30
SECTION 11.13. [Reserved.].....................................................................................30
SECTION 11.14. Depositor Payment Obligation....................................................................30
EXHIBIT A Form of Trust Certificate
EXHIBIT B Form of Certificate of Trust
EXHIBIT C Form of Transferor Certificate
EXHIBIT D Form of Investment Letter
EXHIBIT E Form of Depository Agreement
ANNEX A Tax Partnership Provisions
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TRUST AGREEMENT dated as of [______], [_______], between WORLD OMNI
AUTO RECEIVABLES LLC, a Delaware limited liability company, as
depositor (the "Depositor") and [____________________], a Delaware
banking corporation, as owner trustee (the "Owner Trustee").
ARTICLE I
Definitions
SECTION 1.01. Capitalized Terms. For all purposes of this
Agreement, the following terms shall have the meanings set
forth below:
["Administration Agreement" shall mean the Administration
Agreement dated as of [__________], [________] among the Administrator, the
Trust and the Indenture Trustee.]
"Administrator" shall mean World Omni Financial Corp., a
Florida corporation, or any successor Administrator under the Administration
Agreement.
"Agreement" shall mean this Trust Agreement, as the same may
be amended and supplemented from time to time.
"Basic Documents" shall mean the Sale and Servicing Agreement,
the Indenture, the Administration Agreement, the Receivables Purchase Agreement,
and the other documents, instruments and certificates delivered in connection
therewith.
"Benefit Plan" shall have the meaning assigned to such term in
Section 3.04.
"Book-Entry Trust Certificate" shall mean a beneficial
interest in the Trust Certificates, ownership and transfers of which shall be
made through book entries by a Clearing Agency as described in Section 3.11.
"Business Trust Statute" shall mean 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" shall mean the agreement
dated [_____], [______], among the Trust, the Owner Trustee, the Administrator
and The Depository Trust Company, as the initial Clearing Agency, substantially
in the form attached hereto as Exhibit E, relating to the Trust Certificates, as
the same may be amended and supplemented from time to time.
"Certificate Distribution Account" shall have the meaning
assigned to such term in Section 5.01.
"Certificate of Trust" shall mean the Certificate of Trust in
the form of Exhibit B filed for the Trust pursuant to Section 3810(a) of the
Business Trust Statute.
"Certificate Register" and "Certificate Registrar" shall mean
the register mentioned in and the registrar appointed pursuant to Section 3.04.
"Certificate Owner" shall mean, with respect to a Book-Entry
Trust Certificate, a Person who is the beneficial owner of such Book-Entry Trust
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).
"Certificateholder" or "Holder" shall mean a Person in whose
name a Trust Certificate is registered.
"Clearing Agency" shall mean an organization registered as a
"clearing agency" pursuant to Section 17A of the Exchange Act.
"Clearing Agency Participant" shall mean a broker, dealer,
bank, other financial institution or other Person for whom from time to time a
Clearing Agency effects book-entry transfers and pledges of securities deposited
with the Clearing Agency.
"Code" shall mean the Internal Revenue Code of 1986, as
amended, and Treasury Regulations promulgated thereunder.
"Corporate Trust Office" shall mean, with respect to the Owner
Trustee, the principal corporate trust office of the Owner Trustee located at
[_____________], Attn: [_____________], or at such other address as the Owner
Trustee may designate by notice to the Owners and the Depositor, or the
principal corporate trust office of any successor Owner Trustee at the address
designated by such successor Owner Trustee by notice to the Owners and the
Depositor.
"Definitive Trust Certificates" shall have the meaning set
forth in Section 3.11.
["Demand Note" shall mean, in the case of the Depositor, the
Demand Note dated [______], [______], from World Omni to the Depositor.]
"Depositor" shall mean World Omni Auto Receivables LLC in its
capacity as depositor hereunder.
"Depositor's Interest" shall mean the Trust Certificate owned
by the Depositor evidencing (i) a not less than 1% undivided interest in the
Certificate Balance and interest at the Pass-Through Rate and (ii) all other
amounts in respect of the Trust property to which the Depositor is entitled
hereunder.
"ERISA" shall have the meaning assigned thereto in Section
3.04.
"Exchange Act" shall mean the Securities Exchange Act of 1934,
as amended.
"Expenses" shall have the meaning assigned to such term in
Section 8.02.
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"Indemnified Parties" shall have the meaning assigned to such
term in Section 8.02.
"Indenture" shall mean the Indenture dated as of [_____],
[_____] between the Trust and [_____________], as Indenture Trustee.
"Initial Certificate Balance" shall mean $[___________].
"Owner" shall mean each Holder of a Trust Certificate.
"Owner Trust Estate" shall mean all right, title and interest
of the Trust in and to the property and rights assigned to the Trust pursuant to
Article II of the Sale and Servicing Agreement, all funds on deposit from time
to time in the Trust Accounts and the Certificate Distribution Account and all
other property of the Trust from time to time, including any rights of the Owner
Trustee and the Trust pursuant to the Sale and Servicing Agreement and the
Administration Agreement.
"Owner Trustee" shall mean [____________________], a Delaware
banking corporation, not in its individual capacity but solely as owner trustee
under this Agreement, and any successor Owner Trustee hereunder.
"Paying Agent" shall mean any paying agent or co-paying agent
appointed pursuant to Section 3.09 and shall initially be
[____________________].
"Person" shall mean any individual, corporation, estate,
partnership, joint venture, association, joint stock company, trust (including
any beneficiary thereof), unincorporated organization, or government or any
agency or political subdivision thereof.
"Receivables Purchase Agreement" shall mean the Receivables
Purchase Agreement, dated as of [_______], [________], among World Omni
Financial Corp., as seller and Depositor, as purchaser.
"Record Date" shall mean, with respect to any Distribution
Date, the close of business on the last day of the month immediately preceding
such Distribution Date.
"Sale and Servicing Agreement" shall mean the Sale and
Servicing Agreement dated as of [_____], [______], among the Trust, as issuer,
the Depositor, as seller, World Omni Financial Corp., as servicer as the same
may be amended or supplemented from time to time.
"Secretary of State" shall mean the Secretary of State of the
State of Delaware.
"Treasury Regulations" shall mean regulations, including
proposed or temporary Regulations, promulgated under the Code. References herein
to specific provisions of proposed or temporary regulations shall include
analogous provisions of final Treasury Regulations or other successor Treasury
Regulations.
"Trust" shall mean the trust established by this Agreement.
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"Trust Certificate" shall mean a certificate evidencing the
beneficial interest of an Owner in the Trust, substantially in the form attached
hereto as Exhibit A.
"World Omni" shall mean World Omni Financial Corp., a Florida
corporation, and any successor in interest.
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 II
Organization
SECTION 2.01. Name. The Trust created hereby shall be known as
"World Omni Auto Receivables Trust [_____]-[_]" in which name the Owner Trustee
may conduct the
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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
Delaware as the Owner Trustee may designate by written notice to the Owners and
the Depositor.
SECTION 2.03. Purposes and Powers. (a) The purpose of the
Trust is to engage in the following activities:
(i) to issue the Notes pursuant to the Indenture and the Trust
Certificates pursuant to this Agreement and to sell the Notes and the
Trust Certificates;
(ii) with the proceeds of the sale of the Notes and the Trust
Certificates, to purchase the Receivables, to fund the Reserve Account
and to pay the organizational, start-up and transactional expenses of
the Trust;
(iii) to assign, grant, transfer, pledge, mortgage and convey
the Trust Estate pursuant to the Indenture and to hold, manage and
distribute to the Owners pursuant to the terms of the Sale and
Servicing Agreement any portion of the Trust Estate released from the
Lien of, and remitted to the Trust pursuant to, the Indenture;
(iv) to enter into and perform its obligations under the Basic
Documents to which it is to be a party;
(v) to engage in those activities, including entering into
agreements, that are necessary, suitable or convenient to accomplish
the foregoing or are incidental thereto or connected therewith; and
(vi) subject to compliance with the Basic Documents, to engage
in such other activities as may be required in connection with
conservation of the Owner Trust Estate and the making of distributions
to the Owners and the Noteholders.
The Trust is hereby authorized to engage in the foregoing activities. The Trust
shall not engage in any activity other than in connection with the foregoing or
other than as required or authorized by the terms of this Agreement or the Basic
Documents.
SECTION 2.04. Appointment of Owner Trustee. The Depositor
hereby appoints the Owner Trustee as trustee of the Trust effective as of the
date hereof, to have all the rights, powers and duties set forth herein.
SECTION 2.05. Initial Capital Contribution of Owner Trust
Estate. The Depositor hereby sells, assigns, transfers, conveys and sets over to
the Owner Trustee, as of the date hereof, the sum of $1. The Owner Trustee
hereby acknowledges receipt in trust from the Depositor, as of the date hereof,
of the foregoing contribution, which shall constitute the initial Owner Trust
Estate and shall be deposited in the Certificate Distribution Account. The
Depositor shall pay organizational expenses of the Trust as they may arise or
shall, upon the
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request of the Owner Trustee, promptly reimburse the Owner Trustee for any such
expenses paid by the Owner Trustee.
SECTION 2.06. Declaration of Trust. The Owner Trustee hereby
declares that it will hold the Owner Trust Estate in trust upon and subject to
the conditions set forth herein for the use and benefit of the Owners, subject
to the obligations of the Trust under the Basic Documents. It is the intention
of the parties hereto that the Trust constitute a business trust under the
Business Trust Statute and that this Agreement constitute the governing
instrument of such business trust. It is the intention of the parties hereto
that, solely for income and franchise tax purposes, the Trust shall be treated
as a partnership, with the assets of the partnership being the Receivables and
other assets held by the Trust, the partners of the partnership being the
Certificateholders (including the Depositor, in its capacity as recipient of
distributions from the Reserve Account), and the Notes being debt of the
partnership. The parties agree that, unless otherwise required by appropriate
tax authorities, the Trust will file or cause to be filed annual or other
necessary returns, reports and other forms consistent with the characterization
of the Trust as a partnership for such tax purposes. Effective as of the date
hereof, the Owner Trustee shall have all rights, powers and duties set forth
herein and in the Business Trust Statute with respect to accomplishing the
purposes of the Trust.
SECTION 2.07. Liability of the Owners. (a) The Depositor shall
be liable directly to and will indemnify any injured party for all losses,
claims, damages, liabilities and expenses of the Trust (including Expenses, to
the extent not paid out of the Owner Trust Estate) to the extent that the
Depositor would be liable if the Trust were a partnership under the Delaware
Revised Uniform Limited Partnership Act in which the Depositor were a general
partner; provided, however, that the Depositor shall not be liable for any
losses incurred by a Certificateholder in the capacity of an investor in the
Trust Certificates, or by a Noteholder in the capacity of an investor in the
Notes. In addition, any third party creditors of the Trust (other than in
connection with the obligations described in the preceding sentence for which
the Depositor shall not be liable) shall be deemed third party beneficiaries of
this paragraph and paragraph (c) below. The obligations of the Depositor under
this paragraph and paragraph (c) below shall be evidenced by the Trust
Certificates described in Section 3.10, which for purposes of the Business Trust
Statute shall be deemed to be a separate class of Trust Certificates from all
other Trust Certificates issued by the Trust; provided that the rights and
obligations evidenced by all Trust Certificates, regardless of class, shall,
except as provided in this Section, be identical.
(b) No Owner, other than to the extent set forth in paragraphs
(a) and (c), shall have any personal liability for any liability or obligation
of the Trust.
(c) The Depositor agrees to be liable directly to and will
indemnify any injured party for all losses, claims, damages, liabilities and
expenses (other than those incurred by a Certificateholder in the capacity of an
investor in the Trust Certificates and a Noteholder in the capacity of an
investor in the Notes) as though such arrangements were a partnership under the
Delaware Revised Uniform Limited Partnership Act in which the Depositor were a
general partner.
SECTION 2.08. Title to Trust Property. Legal title to all the
Owner Trust Estate shall be vested at all times in the Trust as a separate legal
entity except where applicable
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law in any jurisdiction requires title to any part of the Owner Trust Estate to
be vested in a trustee or trustees, in which case title shall be deemed to be
vested in the Owner Trustee, a co-trustee and/or a separate trustee, as the case
may be.
SECTION 2.09. Situs of Trust. The Trust will be located and
administered in the State of Delaware. All bank accounts maintained by the Owner
Trustee on behalf of the Trust shall be located in the State of Delaware or the
State of New York. The Trust shall not have any employees in any state other
than Delaware; provided, however, that nothing herein shall restrict or prohibit
the Owner Trustee from having employees within or without the State of Delaware.
Payments will be received by the Trust only in Delaware or New York, and
payments will be made by the Trust only from Delaware or New York. The only
office of the Trust will be at the Corporate Trust Office in Delaware.
SECTION 2.10. Representations and Warranties of the Depositor.
The Depositor hereby represents and warrants to the Owner Trustee that:
(a) The Depositor is duly organized and validly
existing as a limited liability company in good standing under the laws
of the State of Delaware, with power and authority to own its
properties and to conduct its business as such properties are currently
owned and such business is presently conducted.
(b) The Depositor is duly qualified to do business as
a foreign limited liability company in good standing and has obtained
all necessary licenses and approvals in all jurisdictions in which the
ownership or lease of its property or the conduct of its business shall
require such qualifications.
(c) The Depositor has the power and authority to
execute and deliver this Agreement and to carry out its terms; the
Depositor has full power and authority to sell and assign the property
to be sold and assigned to and deposited with the Trust and the
Depositor has duly authorized such sale and assignment and deposit to
the Trust by all necessary action; and the execution, delivery and
performance of this Agreement have been duly authorized by the
Depositor by all necessary action.
(d) The consummation of the transactions contemplated
by this Agreement and the fulfillment of the terms hereof do not
conflict with, result in any breach of any of the terms and provisions
of, or constitute (with or without notice or lapse of time) a default
under, the limited liability agreement or bylaws of the Depositor, or
any indenture, agreement or other instrument to which the Depositor is
a party or by which it is bound; nor result in the creation or
imposition of any Lien upon any of its properties pursuant to the terms
of any such indenture, agreement or other instrument (other than
pursuant to the Basic Documents); nor violate any law or, to the best
of the Depositor's knowledge, any order, rule or regulation applicable
to the Depositor of any court or of any federal or state regulatory
body, administrative agency or other governmental instrumentality
having jurisdiction over the Depositor or its properties.
(e) There are no proceedings or investigations
pending or, to the Depositor's best knowledge, threatened before any
court, regulatory body, administrative
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agency or other governmental instrumentality having jurisdiction over
the Depositor or its properties: (A) asserting the invalidity of this
Agreement, (B) seeking to prevent the consummation of any of the
transactions contemplated by this Agreement or (C) seeking any
determination or ruling that might materially and adversely affect the
performance by the Depositor of its obligations under, or the validity
or enforceability of, this Agreement.
SECTION 2.11. Maintenance of the Demand Note. To the fullest
extent permitted by applicable law, the Depositor agrees that it shall not sell,
convey, pledge, transfer or otherwise dispose of the Demand Note.
SECTION 2.12. Federal Income Tax Provisions. Annex A to this
Agreement sets forth the tax accounting and administration of the Trust in a
manner consistent with its treatment as a partnership for federal, state and
local tax purposes.
ARTICLE III
Trust Certificates and Transfer of Interests
SECTION 3.01. Initial Ownership. Upon the formation of the
Trust by the contribution by the Depositor pursuant to Section 2.05 and until
the issuance of the Trust Certificates, the Depositor shall be the sole
beneficiary of the Trust.
SECTION 3.02. The Trust Certificates. The Trust Certificates
shall be issued in minimum denominations of $[________] and in integral
multiples of $[____] in excess thereof; provided, however, that the Trust
Certificates issued to the Depositor pursuant to Section 3.10 may be issued in
such denomination as required to include any residual amount. The Trust
Certificates shall be executed on behalf of the Trust by manual or facsimile
signature of an authorized officer of the Owner Trustee. Trust Certificates
bearing the manual or facsimile signatures of individuals who were, at the time
when such signatures shall have been affixed, authorized to sign on behalf of
the Trust, shall be validly issued and entitled to the benefit of this
Agreement, notwithstanding that such individuals or any of them shall have
ceased to be so authorized prior to the authentication and delivery of such
Trust Certificates or did not hold such offices at the date of authentication
and delivery of such Trust Certificates.
A transferee of a Trust Certificate shall become a
Certificateholder and shall be entitled to the rights and subject to the
obligations of a Certificateholder hereunder upon such transferee's acceptance
of a Trust Certificate duly registered in such transferee's name pursuant to
Section 3.04.
SECTION 3.03. Authentication of Trust Certificates. On the
Closing Date, the Owner Trustee shall cause the Trust Certificates in an
aggregate principal amount equal to the Initial Certificate Balance to be
executed on behalf of the Trust, authenticated and delivered to or upon the
written order of the Depositor, signed by its chairman of the board, its
president, any vice president, secretary or any assistant treasurer, without
further corporate action by the Depositor, in authorized denominations. No Trust
Certificate shall entitle its Holder to any benefit under this Agreement or be
valid for any purpose unless there shall appear on such Trust Certificate a
certificate of authentication substantially in the form set forth in Exhibit A,
executed
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by the Owner Trustee, by manual signature; such authentication shall constitute
conclusive evidence that such Trust Certificate shall have been duly
authenticated and delivered hereunder. All Trust Certificates shall be dated the
date of their authentication.
SECTION 3.04. Registration of Transfer and Exchange of Trust
Certificates. The Certificate Registrar shall keep or cause to be kept, at the
office or agency maintained pursuant to Section 3.08, a Certificate Register in
which, subject to such reasonable regulations as it may prescribe, the Owner
Trustee shall provide for the registration of Trust Certificates and of
transfers and exchanges of Trust Certificates as herein provided.
[____________________] shall be the initial Certificate Registrar.
The Certificates have not been and will not be registered
under the Securities Act and will not be listed on any exchange. No transfer of
a Certificate shall be made unless such transfer is made pursuant to an
effective registration statement under the Securities Act and any applicable
state securities laws or is exempt from the registration requirements under said
Act and such state securities laws. In the event that a transfer is to be made
in reliance upon an exemption from the Securities Act and state securities laws,
in order to assure compliance with the Securities Act and such laws, the Holder
desiring to effect such transfer and such Holder's prospective transferee shall
each certify to the Owner Trustee and the Depositor in writing the facts
surrounding the transfer in substantially the forms set forth in Exhibit C (the
"Transferor Certificate") and Exhibit D (the "Investment Letter"). Except in the
case of a transfer as to which the proposed transferee has provided an
Investment Letter with respect to a Rule 144A transaction, there shall also be
delivered to the Owner Trustee an opinion of counsel that such transfer may be
made pursuant to an exemption from the Securities Act and state securities laws,
which opinion of counsel shall not be an expense of the Trust, the Owner Trustee
or the Indenture Trustee (unless it is the transferee from whom such opinion is
to be obtained) or of the Depositor or World Omni; provided that such opinion of
counsel in respect of the applicable state securities laws may be a memorandum
of law rather than an opinion if such counsel is not licensed in the applicable
jurisdiction. The Depositor shall provide to any Holder of a Certificate and any
prospective transferee designated by any such Holder information regarding the
Certificates and the Receivables and such other information as shall be
necessary to satisfy the condition to eligibility set forth in Rule 144A(d)(4)
for transfer of any such Certificate without registration thereof under the
Securities Act pursuant to the registration exemption provided by Rule 144A.
Each Holder of a Certificate desiring to effect such a transfer shall, and does
hereby agree to, indemnify the Issuer, the Owner Trustee, the Indenture Trustee
and the Depositor against any liability that may result if the transfer is not
so exempt or is not made in accordance with federal and state securities laws.
[No transfer of a Trust Certificate shall be made to any
Person unless the Owner Trustee has received (A) a certificate in the form of
paragraph 3 to the Investment Letter attached hereto as Exhibit D from such
Person to the effect that such Person is not (i) an employee benefit plan (as
defined in Section 3(3) of the Employee Retirement Income Security Act of 1974,
as amended ("ERISA")) that is subject to the provisions of Title I of ERISA,
(ii) a plan described in Section 4975(e)(1) of the Code or (iii) any entity
whose underlying assets include plan assets by reason of a plan's investment in
the entity (each, a "Benefit Plan"), (B) an opinion of counsel satisfactory to
the Owner Trustee and the Depositor to the effect that the purchase and holding
of such Trust Certificate will not constitute or result in the assets of the
Issuer being deemed to be
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"plan assets" subject to the prohibited transactions provisions of ERISA or
Section 4975 of the Code and will not subject the Owner Trustee, the Indenture
Trustee or the Depositor to any obligation in addition to those undertaken in
the Basic Documents or (C) if such Person is an insurance company, a
representation that such Person is an insurance company that is purchasing such
Certificates with funds contained in an "insurance company general account" (as
such term is defined in section v(e) of Prohibited Transaction Class Exemption
95-60 ("PTCE 95-60")) and that the purchase and holding of such Certificates and
any deemed extension of credit from a Certificateholder which is a party in
interest to a Plan, the assets of which are held by such "Insurance Company" are
covered under PTCE 95-60; provided, however, that the Owner Trustee will not
require such certificate or opinion in the event that, as a result of a change
of law or otherwise, counsel satisfactory to the Owner Trustee has rendered an
opinion to the effect that the purchase and holding of a Trust Certificate by a
Benefit Plan or a Person that is purchasing or holding such a Trust Certificate
with the assets of a Benefit Plan will not constitute or result in a prohibited
transaction under ERISA or Section 4975 of the Code. The preparation and
delivery of the certificate and opinions referred to above shall not be an
expense of the Issuer, the Owner Trustee, the Indenture Trustee, the Servicer or
the Depositor. The transferee of a beneficial interest in a Book-Entry Trust
Certificate shall be deemed to represent either (1) that it is not acting on
behalf of a Benefit Plan and is not using the assets of the Benefit Plan to
acquire such interest or (2) that it is an insurance company and is acquiring
such interest with funds contained in an insurance company general account and
that the purchase and holding of such interest is covered under Sections I and
III of PTCE 95-60. Any attempted or purported transfer in violation of these
transfer restrictions will be null and void and will vest no rights in any
purported transferee.
The Owner Trustee shall cause each Certificate to contain a
legend stating that transfer of the Certificates is subject to certain
restrictions and referring prospective purchasers of the Certificates to the
terms of this Agreement with respect to such restrictions.]
Upon surrender for registration of transfer of any Trust
Certificate at the office or agency maintained pursuant to Section 3.08, the
Owner Trustee shall execute, authenticate and deliver, in the name of the
designated transferee or transferees, one or more new Trust Certificates in
authorized denominations of a like aggregate amount dated the date of
authentication by the Owner Trustee or any authenticating agent. At the option
of a Holder, Trust Certificates may be exchanged for other Trust Certificates of
authorized denominations of a like aggregate amount upon surrender of the Trust
Certificates to be exchanged at the office or agency maintained pursuant to
Section 3.08.
Every Trust Certificate presented or surrendered for
registration of transfer or exchange shall be accompanied by a written
instrument of transfer in form satisfactory to the Owner Trustee and the
Certificate Registrar duly executed by the Holder or such Holder's attorney duly
authorized in writing. Each Trust Certificate surrendered for registration of
transfer or exchange shall be cancelled and subsequently disposed of by the
Owner Trustee in accordance with its customary practice.
No service charge shall be made for any registration of
transfer or exchange of Trust Certificates, but the Owner Trustee or the
Certificate Registrar may require payment of a
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sum sufficient to cover any tax or governmental charge that may be imposed in
connection with any transfer or exchange of Trust Certificates.
The preceding provisions of this Section notwithstanding, the
Owner Trustee shall not make, and the Certificate Registrar shall not register
transfers or exchanges of, Trust Certificates for a period of 15 days preceding
the due date for any payment with respect to the Trust Certificates.
SECTION 3.05. Mutilated, Destroyed, Lost or Stolen Trust
Certificates. If (a) any mutilated Trust Certificate shall be surrendered to the
Certificate Registrar, or if the Certificate Registrar shall receive evidence to
its satisfaction of the destruction, loss or theft of any Trust Certificate and
(b) there shall be delivered to the Certificate Registrar and the Owner Trustee
such security or indemnity as may be required by them to save each of them
harmless, then in the absence of notice that such Trust Certificate has been
acquired by a bona fide purchaser, the Owner Trustee on behalf of the Trust
shall execute and the Owner Trustee shall authenticate and deliver, in exchange
for or in lieu of any such mutilated, destroyed, lost or stolen Trust
Certificate, a new Trust Certificate of like tenor and denomination. In
connection with the issuance of any new Trust Certificate under this Section,
the Owner Trustee or the Certificate Registrar may require the payment of a sum
sufficient to cover any tax or other governmental charge that may be imposed in
connection therewith. Any duplicate Trust Certificate issued pursuant to this
Section shall constitute conclusive evidence of ownership in the Trust, as if
originally issued, whether or not the lost, stolen or destroyed Trust
Certificate shall be found at any time.
SECTION 3.06. Persons Deemed Owners. Prior to due presentation
of a Trust Certificate for registration of transfer, the Owner Trustee, the
Certificate Registrar or any Paying Agent may treat the Person in whose name any
Trust Certificate is registered in the Certificate Register as the owner of such
Trust Certificate for the purpose of receiving distributions pursuant to Section
5.02 and for all other purposes whatsoever, and none of the Owner Trustee, the
Certificate Registrar or any Paying Agent shall be bound by any notice to the
contrary.
SECTION 3.07. Access to List of Certificateholders' Names and
Addresses. The Owner Trustee shall furnish or cause to be furnished to the
Servicer and the Depositor, within 15 days after receipt by the Owner Trustee of
a written request therefor from the Servicer or the Depositor, a list, in such
form as the Servicer or the Depositor may reasonably require, of the names and
addresses of the Certificateholders as of the most recent Record Date. If three
or more Certificateholders or one or more Holders of Trust Certificates
evidencing not less than 25% of the Certificate Balance apply in writing to the
Owner Trustee, and such application states that the applicants desire to
communicate with other Certificateholders with respect to their rights under
this Agreement or under the Trust Certificates and such application is
accompanied by a copy of the communication that such applicants propose to
transmit, then the Owner Trustee shall, within five Business Days after the
receipt of such application, afford such applicants access during normal
business hours to the current list of Certificateholders. Each Holder, by
receiving and holding a Trust Certificate, shall be deemed to have agreed not to
hold any of the Depositor, the Certificate Registrar or the Owner Trustee
accountable by reason of the disclosure of its name and address, regardless of
the source from which such information was derived.
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SECTION 3.08. Maintenance of Office or Agency. The Owner
Trustee shall maintain in the Borough of Manhattan, The City of New York, an
office or offices or agency or agencies where Trust Certificates may be
surrendered for registration of transfer or exchange and where notices and
demands to or upon the Owner Trustee in respect of the Trust Certificates and
the Basic Documents may be served. The Owner Trustee initially designates
[_________________], Attention: [________], as its office for such purposes. The
Owner Trustee shall give prompt written notice to the Depositor and to the
Certificateholders of any change in the location of the Certificate Register or
any such office or agency.
SECTION 3.09. Appointment of Paying Agent. The Paying Agent
shall make distributions to Certificateholders from the Certificate Distribution
Account pursuant to Section 5.02 and shall report the amounts of such
distributions to the Owner Trustee. Any Paying Agent shall have the revocable
power to withdraw funds from the Certificate Distribution Account for the
purpose of making the distributions referred to above. The Owner Trustee may
revoke such power and remove the Paying Agent if the Owner Trustee determines in
its sole discretion that the Paying Agent shall have failed to perform its
obligations under this Agreement in any material respect. The Owner Trustee will
be the initial Paying Agent. In the event that the Owner Trustee shall no longer
be the Paying Agent, the Owner Trustee shall appoint a successor to act as
Paying Agent (which shall be a bank or trust company). The Owner Trustee shall
cause such successor Paying Agent or any additional Paying Agent appointed by
the Owner Trustee to execute and deliver to the Owner Trustee an instrument in
which such successor Paying Agent or additional Paying Agent shall agree with
the Owner Trustee that, as Paying Agent, such successor Paying Agent or
additional Paying Agent will hold all sums, if any, held by it for payment to
the Certificateholders in trust for the benefit of the Certificateholders
entitled thereto until such sums shall be paid to such Certificateholders. The
Paying Agent shall return all unclaimed funds to the Owner Trustee and upon
removal of a Paying Agent such Paying Agent shall also return all funds in its
possession to the Owner Trustee. The provisions of Sections 7.01, 7.03, 7.04 and
8.01 shall apply to the Owner Trustee also in its role as Paying Agent, for so
long as the Owner Trustee shall act as Paying Agent and, to the extent
applicable, to any other paying agent appointed hereunder. Any reference in this
Agreement to the Paying Agent shall include any co-paying agent unless the
context requires otherwise.
SECTION 3.10. Ownership by Depositor of Trust Certificates.
The Depositor shall on the Closing Date retain Trust Certificates representing
at least 1% of the Initial Certificate Balance and shall thereafter retain
beneficial and record ownership of Trust Certificates representing at least 1%
of the Certificate Balance. Any attempted transfer of the Depositor's Trust
Certificate that would reduce such interest of the Depositor below 1% of the
Certificate Balance shall be void. The Owner Trustee shall cause the Depositor's
Trust Certificate to contain a legend stating "THIS CERTIFICATE IS
NON-TRANSFERABLE".
SECTION 3.11. Book-Entry Trust Certificates. The Trust
Certificates, upon original issuance, will be issued in the form of a
typewritten Trust Certificate or Trust Certificates representing Book-Entry
Trust Certificates, to be delivered to The Depository Trust Company, the initial
Clearing Agency, by, or on behalf of, the Trust; provided, however, that one
Definitive Trust Certificate may be issued to the Depositor pursuant to Section
3.10. Such Trust Certificate or Trust Certificates shall initially be registered
on the Certificate Register in the name of Cede & Co., the nominee of the
initial Clearing Agency, and no Certificate Owner will
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receive a definitive Trust Certificate representing such Certificate Owner's
interest in such Trust Certificate, except as provided in Section 3.13. Unless
and until definitive, fully registered Trust Certificates (the "Definitive Trust
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
Trust Certificates and the giving of instructions or directions
hereunder) as the sole Holder of the Trust 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 Trust
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 Trust 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 Trust
Certificates evidencing a specified percentage of the Certificate
Balance, the Clearing Agency shall be deemed to represent such
percentage only to the extent that it has received instructions to such
effect from Certificate Owners and/or Clearing Agency Participants
owning or representing, respectively, such required percentage of the
beneficial interest in the Trust Certificates and has delivered such
instructions to the Owner Trustee.
SECTION 3.12. Notices to Clearing Agency. Whenever a notice or
other communication to the Certificateholders is required under this Agreement,
unless and until Definitive Trust Certificates shall have been issued to
Certificate Owners pursuant to Section 3.14, 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 Trust Certificates. If (i) the
Administrator advises the Owner Trustee in writing that the Clearing Agency is
no longer willing or able to properly discharge its responsibilities with
respect to the Trust Certificates and the Administrator is unable to locate a
qualified successor, (ii) the Administrator 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 or a
Servicer Default, Certificate Owners representing beneficial interests
aggregating at least a majority of the Certificate Balance advise
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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 Trust Certificates to Certificate Owners requesting the same. Upon
surrender to the Owner Trustee of the typewritten Trust Certificate or Trust
Certificates representing the Book-Entry Trust Certificates by the Clearing
Agency, accompanied by registration instructions, the Owner Trustee shall
execute and authenticate the Definitive Trust 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 Trust Certificates, the Owner
Trustee shall recognize the Holders of the Definitive Trust Certificates as
Certificateholders. The Definitive Trust 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.
ARTICLE IV
Actions by Owner Trustee
SECTION 4.01. Prior Notice to Owners with Respect to Certain
Matters. With respect to the following matters, the Owner Trustee shall not take
action unless at least 30 days before the taking of such action, the Owner
Trustee shall have notified the Certificateholders in writing of the proposed
action and the 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 provided alternative direction:
(a) the initiation of any claim or lawsuit by the Trust
(except claims or lawsuits brought in connection with the collection of
the Receivables) and the compromise of any action, claim or lawsuit
brought by or against the Trust (except with respect to the
aforementioned claims or lawsuits for collection of the Receivables);
(b) the election by the Trust to file an amendment to the
Certificate of Trust (unless such amendment is required to be filed
under the Business Trust Statute);
(c) the amendment of the Indenture by a supplemental indenture
in circumstances where the consent of any Noteholder is required;
(d) the amendment of the Indenture by a supplemental indenture
in circumstances where the consent of any Noteholder is not required
and such amendment would materially adversely affect the interests of
the Owners;
(e) the amendment, change or modification of the
Administration Agreement, except to cure any ambiguity or to amend or
supplement any provision in a manner or add any provision that would
not materially adversely affect the interests of the Owners; or
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(f) the appointment pursuant to the Indenture of a successor
Note Registrar, Paying Agent or Indenture Trustee or pursuant to this
Agreement of a successor Certificate Registrar, or the consent to the
assignment by the Note Registrar, Paying Agent or Indenture Trustee or
Certificate Registrar of its obligations under the Indenture or this
Agreement, as applicable.
SECTION 4.02. Action by Owners with Respect to Certain
Matters. The Owner Trustee shall not have the power, except upon the written
direction of the Owners, to (a) remove the Administrator under the
Administration Agreement pursuant to Section 8 thereof, (b) appoint a successor
Administrator under the Administration Agreement pursuant to Section 8 thereof,
(c) remove the Servicer under the Sale and Servicing Agreement pursuant to
Section 8.01 thereof or (d) except as expressly provided in the Basic Documents,
sell the Receivables after the termination of the Indenture. The Owner Trustee
shall take the actions referred to in the preceding sentence only upon written
instructions signed by the Owners.
SECTION 4.03. Action by Owners with Respect to Bankruptcy. The
Owner Trustee shall not have the power to commence a voluntary proceeding in
bankruptcy relating to the Trust without the unanimous prior approval of all
Owners and the delivery to the Owner Trustee by each such Owner of a certificate
certifying that such Owner reasonably believes that the Trust is insolvent.
SECTION 4.04. Restrictions on Owners' Power. The Owners shall
not direct the Owner Trustee to take or to refrain from taking any action if
such action or inaction would be contrary to any obligation of the Trust or the
Owner Trustee under this Agreement or any of the Basic Documents or would be
contrary to Section 2.03 or contrary to applicable law, nor shall the Owner
Trustee be obligated to follow any such direction, if given.
SECTION 4.05. Majority Control. Except as expressly provided
herein, any action that may be taken by the Owners under this Agreement may be
taken by the Holders of Trust Certificates evidencing not less than a majority
of the Certificate Balance. Except as expressly provided herein, any written
notice of the Owners delivered pursuant to this Agreement shall be effective if
signed by Holders of Trust Certificates evidencing not less than a majority of
the Certificate Balance at the time of the delivery of such notice.
ARTICLE V
Application of Trust Funds; Certain Duties
SECTION 5.01. Establishment of Trust Account. The Owner
Trustee, for the benefit of the Certificateholders, shall establish and maintain
in the name of the Trust an Eligible Deposit Account (the "Certificate
Distribution Account"), bearing a designation clearly indicating that the funds
deposited therein are held for the benefit of the Certificateholders.
The Owner Trustee shall possess all right, title and interest
in all funds on deposit from time to time in the Certificate Distribution
Account and in all proceeds thereof. Except as otherwise expressly provided
herein, the Certificate Distribution Account shall be under the sole dominion
and control of the Owner Trustee for the benefit of the Certificateholders. If,
at any
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time, the Certificate Distribution Account ceases to be an Eligible Deposit
Account, the Owner Trustee (or the Depositor on behalf of the Owner Trustee, if
the Certificate Distribution Account is not then held by the Owner Trustee or
an affiliate thereof) shall within 10 Business Days (or such longer period, not
to exceed 30 calendar days, as to which each Rating Agency may consent)
establish a new Certificate Distribution Account as an Eligible Deposit Account
and shall transfer any cash and/or any investments to such new Certificate
Distribution Account.
SECTION 5.02. Application of Trust Funds. (a) On each
Distribution Date, the Owner Trustee will distribute to Certificateholders, on a
pro rata basis, amounts deposited in the Certificate Distribution Account
pursuant to Section 5.06 of the Sale and Servicing Agreement with respect to
such Distribution Date.
(b) On each Distribution Date, the Owner Trustee shall send to
each Certificateholder the statement or statements provided to the Owner Trustee
by the Servicer pursuant to Section 5.09 of the Sale and Servicing Agreement
with respect to such Distribution Date.
SECTION 5.03. Method of Payment. Subject to Section 9.01(c),
distributions required to be made to Certificateholders on any Distribution Date
shall be made to each Certificateholder of record on the preceding Record Date
either (x) 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 no later than the Record Date prior to such
Distribution Date, or (y) if such Holder does not qualify under clause (x), by
check mailed to such Certificateholder at the address of such holder appearing
in the Certificate Register.
SECTION 5.04. No Segregation of Moneys; No Interest. Subject
to Sections 5.01 and 5.02, moneys received by the Owner Trustee hereunder need
not be segregated in any manner except to the extent required by law or the Sale
and Servicing Agreement and may be deposited under such general conditions as
may be prescribed by law, and the Owner Trustee shall not be liable for any
interest thereon.
SECTION 5.05. Accounting and Reports to the Noteholders,
Owners, the Internal Revenue Service and Others. In accordance with Annex A
hereto, the Owner Trustee shall (a) maintain (or cause to be maintained) the
books of the Trust on a calendar year basis and the accrual method of
accounting, in a manner consistent with its treatment as a partnership for
federal and applicable state and local tax purposes, (b) deliver to each Owner,
as may be required by the Code and applicable Treasury Regulations, such
information as may be required (including Schedule K-1) to enable each Owner to
prepare its federal and state income tax returns, (c) file such tax returns
relating to the Trust (including a partnership information return, IRS Form
1065) and make such elections as from time to time may be required or
appropriate under any applicable state or federal statute or any rule or
regulation thereunder so as to maintain the Trust's characterization as a
partnership for federal income tax purposes, (d) cause such tax returns to be
signed in the manner required by law and (e) collect or cause to be collected
any withholding tax as described in and in accordance with Section 6(e) of Annex
A hereto with respect to income or distributions to Owners. The Owner Trustee
shall elect under Section 1278 of the Code to include in income currently any
market discount that accrues with respect to the
16
Receivables. The Owner Trustee shall not make the election provided under
Section 754 of the Code.
SECTION 5.06. Signature on Returns. The Owner Trustee shall
sign on behalf of the Trust the tax returns of the Trust, unless applicable law
requires an Owner to sign such documents, in which case such documents shall be
signed by the Depositor.
ARTICLE VI
Authority and Duties of Owner Trustee
SECTION 6.01. General Authority. The Owner Trustee is
authorized and directed to execute and deliver the Basic Documents to which the
Trust is to be a party and each certificate or other document attached as an
exhibit to or contemplated by the Basic Documents to which the Trust is to be a
party and, in each case, in such form as the Depositor shall approve, as
evidenced conclusively by the Owner Trustee's execution thereof. In addition to
the foregoing, the Owner Trustee is authorized, but shall not be obligated, to
take all actions required of the Trust pursuant to the Basic Documents. The
Owner Trustee is further authorized from time to time to take such action as the
Administrator recommends with respect to the Basic Documents.
SECTION 6.02. General Duties. It shall be the duty of the
Owner Trustee to discharge (or cause to be discharged) all of its
responsibilities pursuant to the terms of this Agreement and the Basic Documents
to which the Trust is a party and to administer the Trust in the interest of the
Owners, subject to the Basic Documents and in accordance with the provisions of
this Agreement. Notwithstanding the foregoing, the Owner Trustee shall be deemed
to have discharged its duties and responsibilities hereunder and under the Basic
Documents to the extent the Administrator has agreed in the Administration
Agreement to perform any act or to discharge any duty of the Owner Trustee
hereunder or under any Basic Document, and the Owner Trustee shall not be held
liable for the default or failure of the Administrator to carry out its
obligations under the Administration Agreement.
SECTION 6.03. Action upon Instruction. (a) Subject to Article
IV and in accordance with the terms of the Basic Documents, the Owners may by
written instruction direct the Owner Trustee in the management of the Trust.
Such direction may be exercised at any time by written instruction of the Owners
pursuant to Article IV.
(b) The Owner Trustee shall not be required to take any action
hereunder or under any Basic Document if the Owner Trustee shall have reasonably
determined, or shall have been advised by counsel, that such action is likely to
result in liability on the part of the Owner Trustee or is contrary to the terms
hereof or of any Basic Document or is otherwise contrary to law.
(c) Whenever the Owner Trustee is unable to decide between
alternative courses of action permitted or required by the terms of this
Agreement or under any Basic Document, the Owner Trustee shall promptly give
notice (in such form as shall be appropriate under the circumstances) to the
Owners requesting instruction as to the course of action to be
17
adopted, and to the extent the Owner Trustee acts in good faith in accordance
with any written instruction of the Owners received, the Owner Trustee shall not
be liable on account of such action to any Person. If the Owner Trustee shall
not have received appropriate instruction within 10 days of such notice (or
within such shorter period of time as reasonably may be specified in such notice
or may be necessary under the circumstances) it may, but shall be under no duty
to, take or refrain from taking such action not inconsistent with this Agreement
or the Basic Documents, as it shall deem to be in the best interests of the
Owners, and shall have no liability to any Person for such action or inaction.
(d) In the event that the Owner Trustee is unsure as to the
application of any provision of this Agreement or any Basic Document or any such
provision is ambiguous as to its application, or is, or appears to be, in
conflict with any other applicable provision, or in the event that this
Agreement permits any determination by the Owner Trustee or is silent or is
incomplete as to the course of action that the Owner Trustee is required to take
with respect to a particular set of facts, the Owner Trustee may give notice (in
such form as shall be appropriate under the circumstances) to the Owners
requesting instruction and, to the extent that the Owner Trustee acts or
refrains from acting in good faith in accordance with any such instruction
received, the Owner Trustee shall not be liable, on account of such action or
inaction, to any Person. If the Owner Trustee shall not have received
appropriate instruction within 10 days of such notice (or within such shorter
period of time as reasonably may be specified in such notice or may be necessary
under the circumstances) it may, but shall be under no duty to, take or refrain
from taking such action not inconsistent with this Agreement or the Basic
Documents, as it shall deem to be in the best interests of the Owners, and shall
have no liability to any Person for such action or inaction.
SECTION 6.04. No Duties Except as Specified in this Agreement
or in Instructions. The Owner Trustee shall not have any duty or obligation to
manage, make any payment with respect to, register, record, sell, dispose of, or
otherwise deal with the Owner Trust Estate, or to otherwise take or refrain from
taking any action under, or in connection with, any document contemplated hereby
to which the Owner Trustee is a party, except as expressly provided by the terms
of this Agreement or in any document or written instruction received by the
Owner Trustee pursuant to Section 6.03; and no implied duties or obligations
shall be read into this Agreement or any Basic Document against the Owner
Trustee. The Owner Trustee shall have no responsibility for filing any financing
or continuation statement in any public office at any time or to otherwise
perfect or maintain the perfection of any security interest or lien granted to
it hereunder or to prepare or file any Securities and Exchange Commission filing
for the Trust or to record this Agreement or any Basic Document. The Owner
Trustee nevertheless agrees that it will, at its own cost and expense, promptly
take all action as may be necessary to discharge any liens on any part of the
Owner Trust Estate that result from actions by, or claims against, the Owner
Trustee that are not related to the ownership or the administration of the Owner
Trust Estate.
SECTION 6.05. No Action Except Under Specified Documents or
Instructions. The Owner Trustee shall not manage, control, use, sell, dispose of
or otherwise deal with any part of the Owner Trust Estate except (i) in
accordance with the powers granted to and the authority conferred upon the Owner
Trustee pursuant to this Agreement, (ii) in
18
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 VII
Concerning the Owner Trustee
SECTION 7.01. Acceptance of Trusts and Duties. The Owner
Trustee accepts the trusts hereby created and agrees to perform its duties
hereunder with respect to such trusts, but only upon the terms of this
Agreement. The Owner Trustee also agrees to disburse all moneys actually
received by it constituting part of the Owner Trust Estate upon the terms of the
Basic Documents and this Agreement. The Owner Trustee shall not be answerable or
accountable hereunder or under any Basic Document under any circumstances,
except (i) for its own willful misconduct or gross negligence (or negligence in
the case of handling funds), (ii) for liabilities arising from the failure by
the Owner Trustee to perform obligations expressly undertaken by it in the last
sentence of Section 6.04 hereof, (iii) for any investments made by the Owner
Trustee with [____________________] (in its individual capacity) in its
commercial capacity, (iv) in the case of the inaccuracy of any representation or
warranty contained in Section 7.03 expressly made by the Owner Trustee or (v)
for federal or Delaware taxes, fees or other charges, based on or measured by
any fees, commissions or compensation received by the Owner Trustee in
connection with any of the transactions contemplated by this Agreement or any of
the Basic Documents. In particular, but not by way of limitation (and subject to
the exceptions set forth in the preceding sentence):
(a) The Owner Trustee shall not be liable for any error of
judgment made by a Trust Officer of the Owner Trustee;
(b) The Owner Trustee shall not be liable with respect to any
action taken or omitted to be taken by it in accordance with the
instructions of the Administrator or any Owner;
(c) No provision of this Agreement or any Basic Document
shall require the Owner Trustee to expend or risk funds or otherwise
incur any financial liability in the performance of any of its rights
or powers hereunder or under any Basic Document if the Owner Trustee
shall have reasonable grounds for believing that repayment of such
funds or adequate indemnity against such risk or liability is not
reasonably assured or provided to it;
(d) Under no circumstances shall the Owner Trustee be liable
for indebtedness evidenced by or arising under any of the Basic
Documents, including the principal of and interest on the Notes;
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(e) The Owner Trustee shall not be responsible for or in
respect of the validity or sufficiency of this Agreement or for the due
execution hereof by the Depositor or for the form, character,
genuineness, sufficiency, value or validity of any of the Owner Trust
Estate, or for or in respect of the validity or sufficiency of the
Basic Documents, other than the certificate of authentication on the
Trust Certificates, and the Owner Trustee shall in no event assume or
incur any liability, duty or obligation to any Noteholder or to any
Owner, other than as expressly provided for herein or expressly agreed
to in the Basic Documents;
(f) The Owner Trustee shall not be liable for the default or
misconduct of the Administrator, the Depositor, the Indenture Trustee
or the Servicer under any of the Basic Documents or otherwise, and the
Owner Trustee shall have no obligation or liability to perform the
obligations of the 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 or World Omni Auto Receivables LLC, as Depositor under the
Sale and Servicing Agreement; and
(g) The Owner Trustee shall be under no obligation to
exercise any of the rights or powers vested in it by this Agreement, or
to institute, conduct or defend any litigation under this Agreement or
otherwise or in relation to this Agreement or any Basic Document, at
the request, order or direction of any of the Owners, unless such
Owners have offered to the Owner Trustee security or indemnity
satisfactory to it against the costs, expenses and liabilities that may
be incurred by the Owner Trustee therein or thereby. The right of the
Owner Trustee to perform any discretionary act enumerated in this
Agreement or in any Basic Document shall not be construed as a duty,
and the Owner Trustee shall not be answerable for other than its
negligence or willful misconduct in the performance of any such act.
SECTION 7.02. Furnishing of Documents. The Owner Trustee shall
furnish to the Owners promptly upon receipt of a written request therefor,
duplicates or copies of all reports, notices, requests, demands, certificates,
financial statements and any other instruments furnished to the Owner Trustee
under the Basic Documents.
SECTION 7.03. Representations and Warranties. The Owner
Trustee hereby represents and warrants to the Depositor, for the benefit of the
Owners, that:
(a) It is a banking corporation duly organized and validly
existing in good standing under the laws of the State of Delaware. It
has all requisite corporate power and authority to execute, deliver and
perform its obligations under this Agreement.
(b) It has taken all corporate action necessary to authorize
the execution and delivery by it of this Agreement, and this Agreement
will be executed and delivered by one of its officers who is duly
authorized to execute and deliver this Agreement on its behalf.
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(c) Neither the execution or the delivery by it of this
Agreement, nor the consummation by it of the transactions contemplated
hereby, nor compliance by it with any of the terms or provisions hereof
will contravene any federal or Delaware law, governmental rule or
regulation governing the banking or trust powers of the Owner Trustee
or any judgment or order binding on it, or constitute any default under
its charter documents or bylaws or any indenture, mortgage, contract,
agreement or instrument to which it is a party or by which any of its
properties may be bound.
SECTION 7.04. Reliance; Advice of Counsel. (a) The Owner
Trustee shall incur no liability to anyone in acting upon any signature,
instrument, notice, resolution, request, consent, order, certificate, report,
opinion, bond, or other document or paper believed by it to be genuine and
believed by it to be signed by the proper party or parties. The Owner Trustee
may accept a certified copy of a resolution of the board of directors or other
governing body of any corporate party as conclusive evidence that such
resolution has been duly adopted by such body and that the same is in full force
and effect. As to any fact or matter the method of determination of which is not
specifically prescribed herein, the Owner Trustee may for all purposes hereof
rely on a certificate, signed by the president or any vice president or by the
treasurer or other authorized officers of the relevant party, as to such fact or
matter, and such certificate shall constitute full protection to the Owner
Trustee for any action taken or omitted to be taken by it in good faith in
reliance thereon.
(b) In the exercise or administration of the trusts hereunder
and in the performance of its duties and obligations under this Agreement or the
Basic Documents, the Owner Trustee (i) may act directly or through its agents or
attorneys pursuant to agreements entered into with any of them, and the Owner
Trustee shall not be liable for the conduct or misconduct of such agents or
attorneys if such agents or attorneys shall have been selected by the Owner
Trustee with reasonable care, and (ii) may consult with counsel, accountants and
other skilled Persons to be selected with reasonable care and employed by it.
The Owner Trustee shall not be liable for anything done, suffered or omitted in
good faith by it in accordance with the written opinion or advice of any such
counsel, accountants or other such Persons and not contrary to this Agreement or
any Basic Document.
SECTION 7.05. Not Acting in Individual Capacity. Except as
provided in this Article VII, in accepting the trusts hereby created
[____________________] acts solely as Owner Trustee hereunder and not in its
individual capacity, and all Persons having any claim against the Owner Trustee
by reason of the transactions contemplated by this Agreement or any Basic
Document shall look only to the Owner Trust Estate for payment or satisfaction
thereof.
SECTION 7.06. Owner Trustee Not Liable for Trust Certificates
or Receivables. The Owner Trustee makes no representations as to the validity or
sufficiency of this Agreement, of any Basic Document or of the Trust
Certificates (other than the signature and countersignature of the Owner Trustee
on the Trust Certificates) or the Notes, or of any Receivable or related
documents. The Owner Trustee shall at no time have any responsibility or
liability for or with respect to the legality, validity and enforceability of
any Receivable, or the perfection and priority of any security interest created
by any Receivable in any Financed Vehicle or the maintenance of any such
perfection and priority, or for or with respect to the sufficiency of the Owner
Trust Estate or its ability to generate the payments to be distributed to
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Certificateholders under this Agreement or the Noteholders under the Indenture,
including, without limitation: the existence, condition and ownership of any
Financed Vehicle; the existence and enforceability of any insurance thereon; the
existence and contents of any Receivable on any computer or other record
thereof; the validity of the assignment of any Receivable to the Trust or of any
intervening assignment; the completeness of any Receivable; the performance or
enforcement of any Receivable; the compliance by the Depositor 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 or the Servicer or any
subservicer taken in the name of the Owner Trustee.
SECTION 7.07. Owner Trustee May Own Trust Certificates and
Notes. The Owner Trustee in its individual or any other capacity may become the
owner or pledgee of Trust Certificates or Notes and may deal with the Depositor,
the Administrator, the Indenture Trustee and the Servicer in banking
transactions with the same rights as it would have if it were not Owner Trustee.
ARTICLE VIII
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
have been separately agreed upon before the date hereof between the Depositor
and the Owner Trustee, and the Owner Trustee shall be entitled to be reimbursed
by the Administrator pursuant to the Administration Agreement for its other
reasonable expenses hereunder, including the reasonable compensation, expenses
and disbursements of such agents, representatives, experts and counsel as the
Owner Trustee may employ in connection with the exercise and performance of its
rights and its duties hereunder.
SECTION 8.02. Indemnification. Pursuant to the Administration
Agreement, the Administrator shall be liable as primary obligor for, and shall
indemnify the Owner Trustee and its successors, assigns, agents and servants
(collectively, the "Indemnified Parties") from and against, any and all
liabilities, obligations, losses, damages, taxes, claims, actions and suits, and
any and all reasonable costs, expenses and disbursements (including reasonable
legal fees and expenses) of any kind and nature whatsoever (collectively,
"Expenses") which may at any time be imposed on, incurred by, or asserted
against the Owner Trustee or any Indemnified Party in any way relating to or
arising out of this Agreement, the Basic Documents, the Owner Trust Estate, the
administration of the Owner Trust Estate or the action or inaction of the Owner
Trustee hereunder, except only that the Administrator shall not be liable for or
required to indemnify an Indemnified Party from and against Expenses arising or
resulting from any of the matters described in the third sentence of Section
7.01. The indemnities contained in this Section shall survive the resignation or
termination of the Owner Trustee or the termination of this Agreement. In any
event of any claim, action or proceeding for which indemnity will be sought
pursuant to this Section, the Owner Trustee's choice of legal counsel shall be
subject to the approval of the Administrator, which approval shall not be
unreasonably withheld.
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SECTION 8.03. Payments to the Owner Trustee. Any amounts paid
to the Owner Trustee pursuant to this Article VIII shall be deemed not to be a
part of the Owner Trust Estate immediately after such payment.
ARTICLE IX
Termination of Trust Agreement
SECTION 9.01. Termination of Trust Agreement. (a) This
Agreement (other than Article VIII) and the Trust shall terminate and be of no
further force or effect (i) upon the final distribution by the Owner Trustee of
all moneys or other property or proceeds of the Owner Trust Estate in accordance
with the terms of the Indenture, the Sale and Servicing Agreement and Article V
or (ii) at the time provided in Section 9.02. The bankruptcy, liquidation,
dissolution, death or incapacity of any Owner, other than the Depositor as
described in Section 9.02, shall not (x) operate to terminate this Agreement or
the Trust or (y) entitle such Owner's legal representatives or heirs to claim an
accounting or to take any action or proceeding in any court for a partition or
winding up of all or any part of the Trust or Owner Trust Estate or (z)
otherwise affect the rights, obligations and liabilities of the parties hereto.
(b) Except as provided in Section 9.01(a), neither the
Depositor nor any Owner shall be entitled to revoke or terminate the Trust.
(c) Notice of any termination of the Trust, specifying the
Distribution Date upon which Certificateholders shall surrender their Trust
Certificates to the Paying Agent for payment of the final distribution and
cancellation, shall be given by the Owner Trustee by letter to
Certificateholders mailed within five Business Days of receipt of notice of such
termination from the Servicer given pursuant to Section 9.01(b) of the Sale and
Servicing Agreement, stating (i) the Distribution Date upon or with respect to
which final payment of the Trust Certificates shall be made upon presentation
and surrender of the Trust Certificates at the office of the Paying Agent
therein designated, (ii) the amount of any such final payment and (iii) that the
Record Date otherwise applicable to such Distribution Date is not applicable,
payments being made only upon presentation and surrender of the Trust
Certificates at the office of the Paying Agent therein specified. The Owner
Trustee shall give such notice to the Certificate Registrar (if other than the
Owner Trustee) and the Paying Agent at the time such notice is given to
Certificateholders. Upon presentation and surrender of the Trust Certificates,
the Paying Agent shall cause to be distributed to Certificateholders amounts
distributable on such Distribution Date pursuant to Section 5.02.
In the event that all of the Certificateholders shall not
surrender their Trust Certificates for cancellation within six months after the
date specified in the above mentioned written notice, the Owner Trustee shall
give a second written notice to the remaining Certificateholders to surrender
their Trust Certificates for cancellation and receive the final distribution
with respect thereto. If within one year after the second notice all the Trust
Certificates shall not have been surrendered for cancellation, the Owner Trustee
may take appropriate steps, or may appoint an agent to take appropriate steps,
to contact the remaining Certificateholders concerning surrender of their Trust
Certificates, and the cost thereof shall be paid out of the funds and other
assets that shall remain subject to this Agreement. Any funds
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remaining in the Trust after exhaustion of such remedies shall be distributed by
the Owner Trustee to the Depositor.
(d) Upon the winding up of the Trust and its termination, the
Owner Trustee shall cause the Certificate of Trust to be cancelled by filing a
certificate of cancellation with the Secretary of State in accordance with the
provisions of Section 3810 of the Business Trust Statute.
SECTION 9.02. Dissolution upon Bankruptcy of the Depositor. In
the event that an Insolvency Event shall occur with respect to the Depositor,
this Agreement shall be terminated in accordance with Section 9.01 90 days after
the date of such Insolvency Event, unless, before the end of such 90-day period,
the Owner Trustee shall have received written instructions from (a) Holders of
Certificates (other than the Depositor) representing more than 50% of the
Certificate Balance (not including the Certificate Balance of the Trust
Certificates held by the Depositor) and (b) Holders (as defined in the
Indenture) of Notes representing more than 50% of the Outstanding Amount of the
Notes, to the effect that each such party disapproves of the liquidation of the
Receivables and termination of the Trust. Promptly after the occurrence of any
Insolvency Event with respect to the Depositor, (A) the Depositor shall give the
Indenture Trustee and the Owner Trustee written notice of such Insolvency Event,
(B) the Owner Trustee shall, upon the receipt of such written notice from the
Depositor, give prompt written notice to the Certificateholders and the
Indenture Trustee, of the occurrence of such event and (C) the Indenture Trustee
shall, upon receipt of written notice of such Insolvency Event from the Owner
Trustee or the Depositor, give prompt written notice to the Noteholders of the
occurrence of such event; provided, however, that any failure to give a notice
required by this sentence shall not prevent or delay, in any manner, a
termination of the Trust pursuant to the first sentence of this Section 9.02.
Upon a termination pursuant to this Section, the Owner Trustee shall direct the
Indenture Trustee promptly to sell the assets of the Trust (other than the Trust
Accounts and the Certificate Distribution Account), in a commercially reasonable
manner and on commercially reasonable terms. The proceeds of such a sale of the
assets of the Trust shall be treated as collections under the Sale and Servicing
Agreement.
ARTICLE X
Successor Owner Trustees and Additional Owner Trustees
SECTION 10.01. Eligibility Requirements for Owner Trustee.
The Owner Trustee shall at all times be a corporation satisfying the provisions
of Section 3807(a) of the Business Trust Statute; authorized to exercise
corporate trust powers; having a combined capital and surplus of at least
$50,000,000 and subject to supervision or examination by federal or state
authorities. 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.
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SECTION 10.02. Resignation or Removal of Owner Trustee. The
Owner Trustee may at any time resign and be discharged from the trusts hereby
created by giving written notice thereof to the Administrator. Upon receiving
such notice of resignation, the Administrator shall promptly appoint a successor
Owner Trustee by written instrument, in duplicate, one copy of which instrument
shall be delivered to the resigning Owner Trustee and one copy to the successor
Owner Trustee. If no successor Owner Trustee shall have been so appointed and
have accepted appointment within 30 days after the giving of such notice of
resignation, the resigning Owner Trustee may petition any court of competent
jurisdiction for the appointment of a successor Owner Trustee.
If at any time the Owner Trustee shall cease to be eligible in
accordance with the provisions of Section 10.01 and shall fail to resign after
written request therefor by the Administrator, or if at any time the Owner
Trustee shall be legally unable to act, or shall be adjudged bankrupt or
insolvent, or a receiver of the Owner Trustee or of its property shall be
appointed, or any public officer shall take charge or control of the Owner
Trustee or of its property or affairs for the purpose of rehabilitation,
conservation or liquidation, then the Administrator may remove the Owner
Trustee. If the Administrator shall remove the Owner Trustee under the authority
of the immediately preceding sentence, the Administrator shall promptly appoint
a successor Owner Trustee by written instrument, in duplicate, one copy of which
instrument shall be delivered to the outgoing Owner Trustee so removed and one
copy to the successor Owner Trustee, and shall pay all fees owed to the outgoing
Owner Trustee.
Any resignation or removal of the Owner Trustee and
appointment of a successor Owner Trustee pursuant to any of the provisions of
this Section shall not become effective until acceptance of appointment by the
successor Owner Trustee pursuant to Section 10.03 and payment of all fees and
expenses owed to the outgoing Owner Trustee. The Administrator shall provide
notice of such resignation or removal of the Owner Trustee to each Rating
Agency.
SECTION 10.03. Successor Owner Trustee. Any successor Owner
Trustee appointed pursuant to Section 10.02 shall execute, acknowledge and
deliver to the Administrator and to its predecessor Owner Trustee an instrument
accepting such appointment under this Agreement, and thereupon the resignation
or removal of the predecessor Owner Trustee shall become effective, and such
successor Owner Trustee, without any further act, deed or conveyance, shall
become fully vested with all the rights, powers, duties and obligations of its
predecessor under this Agreement, with like effect as if originally named as
Owner Trustee. The predecessor Owner Trustee shall upon payment of its fees and
expenses deliver to the successor Owner Trustee all documents and statements and
monies held by it under this Agreement; and the Administrator and the
predecessor Owner Trustee shall execute and deliver such instruments and do such
other things as may reasonably be required for fully and certainly vesting and
confirming in the successor Owner Trustee all such rights, powers, duties and
obligations.
No successor Owner Trustee shall accept appointment as
provided in this Section unless at the time of such acceptance such successor
Owner Trustee shall be eligible pursuant to Section 10.01.
Upon acceptance of appointment by a successor Owner Trustee
pursuant to this Section, the Administrator shall mail notice thereof to all
Certificateholders, the Indenture
25
Trustee, the Noteholders and the Rating Agencies. If the Administrator shall
fail to mail such notice within 10 days after acceptance of such appointment by
the successor Owner Trustee, the successor Owner Trustee shall cause such notice
to be mailed at the expense of the Administrator.
SECTION 10.04. Merger or Consolidation of Owner Trustee. Any
corporation into which the Owner Trustee may be merged or converted or with
which it may be consolidated, or any corporation resulting from any merger,
conversion or consolidation to which the Owner Trustee shall be a party, or any
corporation succeeding to all or substantially all of the corporate trust
business of the Owner Trustee, shall be the successor of the Owner Trustee
hereunder, without the execution or filing of any instrument or any further act
on the part of any of the parties hereto, anything herein to the contrary
notwithstanding; provided, that such corporation shall be eligible pursuant to
Section 10.01 and, provided, further, that the Owner Trustee shall mail notice
of such merger or consolidation to each Rating Agency.
SECTION 10.05. Appointment of Co-Trustee or Separate Trustee.
Notwithstanding any other provisions of this Agreement, at any time, for the
purpose of meeting any legal requirements of any jurisdiction in which any part
of the Owner Trust Estate or any Financed Vehicle may at the time be located,
the Administrator and the Owner Trustee acting jointly shall have the power and
shall execute and deliver all instruments to appoint one or more Persons
approved by the Administrator and Owner Trustee to act as co-trustee, jointly
with the Owner Trustee, or as separate trustee or separate trustees, of all or
any part of the Owner Trust Estate, and to vest in such Person, in such
capacity, such title to the Trust or any part thereof and, subject to the other
provisions of this Section, such powers, duties, obligations, rights and trusts
as the Administrator and the Owner Trustee may consider necessary or desirable.
If the Administrator shall not have joined in such appointment within 15 days
after the receipt by it of a request so to do, the Owner Trustee alone shall
have the power to make such appointment. No co-trustee or separate trustee under
this Agreement shall be required to meet the terms of eligibility as a successor
Owner Trustee pursuant to Section 10.01 and no notice of the appointment of any
co-trustee or separate trustee shall be required pursuant to Section 10.03.
Each separate trustee and co-trustee shall, to the extent
permitted by law, be appointed and act subject to the following provisions and
conditions:
(a) All rights, powers, duties and obligations conferred or
imposed upon the Owner Trustee shall be conferred upon and exercised or
performed by the Owner Trustee and such separate trustee or co-trustee
jointly (it being understood that such separate trustee or co-trustee
is not authorized to act separately without the Owner Trustee joining
in such act), except to the extent that under any law of any
jurisdiction in which any particular act or acts are to be performed,
the Owner Trustee shall be incompetent or unqualified to perform such
act or acts, in which event such rights, powers, duties and obligations
(including the holding of title to the Owner Trust Estate or any
portion thereof in any such jurisdiction) shall be exercised and
performed singly by such separate trustee or co-trustee, but solely at
the direction of the Owner Trustee;
(b) No trustee under this Agreement shall be personally
liable by reason of any act or omission of any other trustee under this
Agreement; and
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(c) The Administrator and the Owner Trustee acting jointly
may at any time accept the resignation of or remove any separate
trustee or co-trustee.
Any notice, request or other writing given to the Owner
Trustee shall be deemed to have been given to each of the then separate trustees
and co-trustees, as effectively as if given to each of them. Every instrument
appointing any separate trustee or co-trustee shall refer to this Agreement and
the conditions of this Article. Each separate trustee and co-trustee, upon its
acceptance of the trusts conferred, shall be vested with the estates or property
specified in its instrument of appointment, either jointly with the Owner
Trustee or separately, as may be provided therein, subject to all the provisions
of this Agreement, specifically including every provision of this Agreement
relating to the conduct of, affecting the liability of, or affording protection
to, the Owner Trustee. Each such instrument shall be filed with the Owner
Trustee and a copy thereof given to the Administrator.
Any separate trustee or co-trustee may at any time appoint the
Owner Trustee as its agent or attorney-in-fact with full power and authority, to
the extent not prohibited by law, to do any lawful act under or in respect of
this Agreement on its behalf and in its name. If any separate trustee or
co-trustee shall die, become incapable of acting, resign or be removed, all of
its estates, properties, rights, remedies and trusts shall vest in and be
exercised by the Owner Trustee, to the extent permitted by law, without the
appointment of a new or successor co-trustee or separate trustee.
ARTICLE XI
Miscellaneous
SECTION 11.01. Supplements and Amendments. This Agreement may
be amended by the Depositor and the Owner Trustee, with prior written notice to
each Rating Agency, without the consent of any of the Noteholders or the
Certificateholders, to cure any ambiguity, to correct or supplement any
provisions in this Agreement or for the purpose of adding any provisions to or
changing in any manner or eliminating any of the provisions in this Agreement or
of modifying in any manner the rights of the Noteholders or the
Certificateholders; provided, however, that such action shall not, as evidenced
by an Opinion of Counsel, adversely affect in any material respect the interests
of any Noteholder or Certificateholder.
This Agreement may also be amended from time to time by the
Depositor and the Owner Trustee, with prior written notice to each Rating
Agency, with the consent of the Holders (as defined in the Indenture) of Notes
evidencing not less than a majority of the Outstanding Amount of the Notes and
the consent of the Holders of Certificates evidencing not less than a majority
of the Certificate Balance, for the purpose of adding any provisions to or
changing in any manner or eliminating any of the provisions of this Agreement or
of modifying in any manner the rights of the Noteholders or the
Certificateholders; provided, however, that no such amendment shall (a) increase
or reduce in any manner the amount of, or accelerate or delay the timing of,
collections of payments on Receivables or distributions that shall be required
to be made for the benefit of the Noteholders or the Certificateholders or (b)
reduce the aforesaid percentage of the Outstanding Amount of the Notes and the
Certificate Balance required to
27
consent to any such amendment, without the consent of the holders of all the
outstanding Notes and Certificates.
No amendment to this Agreement shall be recognized or be
effective without the written consent of the Trustee and receipt by the Trustee
of an Opinion of Counsel to the effect that such amendment will not (i) cause
the Trust to be treated as an association taxable as a corporation or as a
publicly-traded partnership for federal income tax purposes or (ii) cause the
Trust to be subject to an entity-level tax for [State of Florida or State of
Delaware] tax purposes.
Promptly after the execution of any such amendment or consent,
the Owner Trustee shall furnish written notification of the substance of such
amendment or consent to each Certificateholder, the Indenture Trustee and each
Rating Agency.
It shall not be necessary for the consent of
Certificateholders, Noteholders or the Indenture Trustee pursuant to this
Section to approve the particular form of any proposed amendment or consent, but
it shall be sufficient if such consent shall approve the substance thereof. The
manner of obtaining such consents (and any other consents of Certificateholders
provided for in this Agreement or in any other Basic Document) and of evidencing
the authorization of the execution thereof by Certificateholders shall be
subject to such reasonable requirements as the Owner Trustee may prescribe.
Promptly after the execution of any amendment to the
Certificate of Trust, the Owner Trustee shall cause the filing of such amendment
with the Secretary of State.
Prior to the execution of any amendment to this Agreement or
the Certificate of Trust, the Owner Trustee shall be entitled to receive and
rely upon an Opinion of Counsel stating that the execution of such amendment is
authorized or permitted by this Agreement. The Owner Trustee may, but shall not
be obligated to, enter into any such amendment that affects the Owner Trustee's
own rights, duties or immunities under this Agreement or otherwise.
In connection with the execution of any amendment to this
Trust Agreement or any amendment of any other agreement to which the Issuer is a
party, the Owner Trustee shall be entitled to receive and conclusively rely upon
an Opinion of Counsel to the effect that such amendment is authorized or
permitted by the Basic Documents and that all conditions precedent in the Basic
Documents for the execution and delivery thereof by the Issuer or the Owner
Trustee, as the case may be, have been satisfied.
SECTION 11.02. No Legal Title to Owner Trust Estate in Owners.
The Owners shall not have legal title to any part of the Owner Trust Estate. The
Owners shall be entitled to receive distributions with respect to their
undivided ownership interest therein only in accordance with Articles V and IX.
No transfer, by operation of law or otherwise, of any right, title or interest
of the Owners to and in their ownership interest in the Owner Trust Estate shall
operate to terminate this Agreement or the trusts hereunder or entitle any
transferee to an accounting or to the transfer to it of legal title to any part
of the Owner Trust Estate.
SECTION 11.03. Limitations on Rights of Others. Except for
Section 2.07, the provisions of this Agreement are solely for the benefit of the
Owner Trustee, the Depositor, the Owners, the Administrator and, to the extent
expressly provided herein, the Indenture Trustee
28
and the Noteholders, and nothing in this Agreement (other than Section 2.07
hereof), whether express or implied, shall be construed to give to any other
Person any legal or equitable right, remedy or claim in the Owner Trust Estate
or under or in respect of this Agreement or any covenants, conditions or
provisions contained herein.
SECTION 11.04. Notices. (a) Unless otherwise expressly
specified or permitted by the terms hereof, all notices shall be in writing and
shall be deemed given upon receipt by the intended recipient or three Business
Days after mailing if personally delivered or mailed by certified mail, return
receipt requested and postage prepaid or by recognized overnight courier or by
facsimile confirmed by delivery or mail as described above (except that notice
to the Owner Trustee shall be deemed given only upon actual receipt by the Owner
Trustee), if to the Owner Trustee, addressed to the Corporate Trust Office; if
to the Depositor, addressed to World Omni Auto Receivables LLC, 120 N.W. 12th
Avenue, Deerfield Beach, Florida 33442, telephone: (954) 429-2200, facsimile:
(954) 429-[_____], Attention: A. Tucker Allen; or, as to each party, at such
other address as shall be designated by such party in a written notice to each
other party.
(b) Any notice required or permitted to be given to a
Certificateholder shall be given by first-class mail, postage prepaid, at the
address of such Holder as shown in the Certificate Register. Any notice so
mailed within the time prescribed in this Agreement shall be conclusively
presumed to have been duly given, whether or not the Certificateholder receives
such notice.
SECTION 11.05. Severability. Any provision of this Agreement
that is prohibited or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof, and any
such prohibition or unenforceability in any jurisdiction shall not invalidate or
render unenforceable such provision in any other jurisdiction.
SECTION 11.06. Separate Counterparts. This Agreement may be
executed by the parties hereto in separate counterparts, each of which when so
executed and delivered shall be an original, but all such counterparts shall
together constitute but one and the same instrument.
SECTION 11.07. Successors and Assigns. All covenants and
agreements contained herein shall be binding upon, and inure to the benefit of,
each of the Depositor and its permitted assignees, the Owner Trustee and its
successors and each Owner and its successors and permitted assigns, all as
herein provided. Any request, notice, direction, consent, waiver or other
instrument or action by an Owner shall bind the successors and assigns of such
Owner.
SECTION 11.08. Covenants of the Depositor. In the event that
(a) Certificateholders' Principal Carryover Shortfalls shall occur or (b) any
litigation with claims in excess of $1,000,000 to which the Depositor is a party
which shall be reasonably likely to result in a material judgment against the
Depositor that the Depositor will not be able to satisfy shall be commenced by
an Owner, during the period beginning nine months following the commencement of
such litigation and continuing until such litigation is dismissed or otherwise
terminated (and, if such litigation has resulted in a final judgment against the
Depositor, such
29
judgment has been satisfied), the Depositor shall not pay any dividend to World
Omni, or make any distribution on or in respect of its capital stock to World
Omni, or repay the principal amount of any indebtedness of the Depositor held by
World Omni, unless (i) after giving effect to such payment, distribution or
repayment, the Depositor's liquid assets shall not be less than the amount of
actual damages claimed in such litigation or (ii) the Rating Agency Condition
shall have been satisfied with respect to any such payment, distribution or
repayment. The Depositor will not at any time institute against the Trust any
bankruptcy proceedings under any United States federal or state bankruptcy or
similar law in connection with any obligations relating to the Trust
Certificates, the Notes, the Trust Agreement or any of the Basic Documents.
SECTION 11.09. No Petition. The Owner Trustee, by entering
into this Agreement, each Certificateholder, by accepting a Trust Certificate,
and the Indenture Trustee and each Noteholder, by accepting the benefits of this
Agreement, hereby covenant and agree that they will not at any time institute
against the Depositor or the Trust, or join in any institution against the
Depositor or the Trust of, any bankruptcy proceedings under any United States
federal or state bankruptcy or similar law in connection with any obligations
relating to the Trust Certificates, the Notes, this Agreement or any of the
Basic Documents.
SECTION 11.10. No Recourse. Each Certificateholder by
accepting a Trust Certificate acknowledges that such Certificateholder's Trust
Certificates represent 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 Trust Certificates
or the Basic Documents.
SECTION 11.11. Headings. The headings of the various Articles
and Sections herein are for convenience of reference only and shall not define
or limit any of the terms or provisions hereof.
SECTION 11.12. GOVERNING LAW. THIS AGREEMENT SHALL BE
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF DELAWARE, WITHOUT
REFERENCE TO ITS CONFLICT OF LAW PROVISIONS, AND THE OBLIGATIONS, RIGHTS AND
REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH
LAWS.
SECTION 11.13. [Reserved.]
SECTION 11.14. Depositor Payment Obligation. The Depositor
shall be responsible for payment of the Administrator's fees under the
Administration Agreement and shall reimburse the Administrator for all expenses
and liabilities of the Administrator incurred thereunder. In addition, the
Depositor shall be responsible for the payment of all fees and expenses of the
Trust, the Owner Trustee and the Indenture Trustee paid by any of them in
connection with any of their obligations under the Basic Documents to obtain or
maintain any required license under the Motor Vehicle Sales Finance Act.
* * * * * *
30
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.
WORLD OMNI AUTO RECEIVABLES LLC,
as Depositor
By: World Omni Financial Corp.,
as its sole member
By: __________________________________
Name:
Title:
[ ]
not in its individual capacity
but solely as Owner Trustee,
By: ___________________________________
Name:
Title:
EXHIBIT A
FORM OF TRUST CERTIFICATE
THIS CERTIFICATE IS SUBORDINATED TO THE NOTES, AS AND TO THE EXTENT SET FORTH IN
THE SALE AND SERVICING AGREEMENT.
UNLESS THIS TRUST CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE ISSUER OR
ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY TRUST
CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME
AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE
TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
THIS CERTIFICATE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED (THE "1933 ACT"), OR UNDER THE SECURITIES OR BLUE SKY
LAWS OF ANY STATE IN THE UNITED STATES OR ANY FOREIGN SECURITIES LAWS. BY ITS
ACCEPTANCE OF THIS CERTIFICATE THE HOLDER HEREOF IS DEEMED TO REPRESENT TO THE
DEPOSITOR AND THE OWNER TRUSTEE (i) THAT IT IS AN "ACCREDITED INVESTOR" AS
DEFINED IN RULE 501(a)(1), (2), (3) OR (7) OF REGULATION D PROMULGATED UNDER THE
1933 ACT (AN "ACCREDITED INVESTOR") AND THAT IT IS ACQUIRING THIS CERTIFICATE
FOR ITS OWN ACCOUNT (AND NOT FOR THE ACCOUNT OF OTHERS) OR AS A FIDUCIARY OR
AGENT FOR OTHERS (WHICH OTHERS ALSO ARE ACCREDITED INVESTORS UNLESS THE HOLDER
IS A BANK ACTING IN ITS FIDUCIARY CAPACITY) FOR INVESTMENT AND NOT WITH A VIEW
TO, OR FOR OFFER OR SALE IN CONNECTION WITH, THE PUBLIC DISTRIBUTION HEREOF,
(ii) THAT IT IS A "QUALIFIED INSTITUTIONAL BUYER" AS DEFINED IN RULE 144A UNDER
THE 1933 ACT AND IS ACQUIRING SUCH CERTIFICATE FOR ITS OWN ACCOUNT (AND NOT FOR
THE ACCOUNT OF OTHERS) OR AS A FIDUCIARY OR AGENT FOR OTHERS (WHICH OTHERS ALSO
ARE QUALIFIED INSTITUTIONAL BUYERS) OR (iii) THAT IT IS AN INVESTOR THAT IS
OTHERWISE PERMITTED TO ACQUIRE THIS CERTIFICATE UNDER THE TRUST AGREEMENT.
NO SALE, PLEDGE OR OTHER TRANSFER OF THIS CERTIFICATE MAY BE MADE BY ANY PERSON
UNLESS EITHER (i) SUCH SALE, PLEDGE OR OTHER TRANSFER IS MADE TO THE DEPOSITOR,
(ii) SUCH SALE, PLEDGE OR OTHER TRANSFER IS MADE TO AN ACCREDITED INVESTOR THAT
EXECUTES A CERTIFICATE, SUBSTANTIALLY IN THE FORM SPECIFIED IN THE TRUST
AGREEMENT, TO THE EFFECT THAT IT IS AN ACCREDITED INVESTOR ACTING FOR ITS OWN
ACCOUNT (AND NOT FOR THE ACCOUNT OF OTHERS) OR AS A FIDUCIARY OR AGENT FOR
OTHERS (WHICH OTHERS ALSO ARE ACCREDITED INVESTORS UNLESS THE
A-1
HOLDER IS A BANK ACTING IN ITS FIDUCIARY CAPACITY), (iii) SO LONG AS THIS
CERTIFICATE IS ELIGIBLE FOR RESALE PURSUANT TO RULE 144A UNDER THE 1933 ACT,
SUCH SALE, PLEDGE OR OTHER TRANSFER IS MADE TO A PERSON WHO THE PROSPECTIVE
TRANSFEROR REASONABLY BELIEVES AFTER DUE INQUIRY IS A "QUALIFIED INSTITUTIONAL
BUYER" (AS DEFINED IN RULE 144A), ACTING FOR ITS OWN ACCOUNT (AND NOT FOR THE
ACCOUNT OF OTHERS) OR AS A FIDUCIARY OR AGENT FOR OTHERS (WHICH OTHERS ALSO ARE
QUALIFIED INSTITUTIONAL BUYERS) TO WHOM NOTICE IS GIVEN THAT THE SALE, PLEDGE OR
TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, OR (iv) SUCH SALE, PLEDGE OR
OTHER TRANSFER IS OTHERWISE MADE IN A TRANSACTION EXEMPT FROM THE REGISTRATION
REQUIREMENTS OF THE 1933 ACT, IN WHICH CASE THE OWNER TRUSTEE SHALL REQUIRE THAT
BOTH THE PROSPECTIVE TRANSFEROR AND THE PROSPECTIVE TRANSFEREE CERTIFY TO THE
OWNER TRUSTEE AND THE DEPOSITOR IN WRITING THE FACTS SURROUNDING SUCH TRANSFER,
WHICH CERTIFICATION SHALL BE IN FORM AND SUBSTANCE SATISFACTORY TO THE OWNER
TRUSTEE AND THE DEPOSITOR. EXCEPT IN THE CASE OF A TRANSFER DESCRIBED IN CLAUSES
(i) OR (iii) ABOVE, THE OWNER TRUSTEE SHALL REQUIRE A WRITTEN OPINION OF COUNSEL
(WHICH SHALL NOT BE AT THE EXPENSE OF THE DEPOSITOR, ANY AFFILIATE OF THE
DEPOSITOR OR THE OWNER TRUSTEE) SATISFACTORY TO THE DEPOSITOR AND THE OWNER
TRUSTEE TO THE EFFECT THAT SUCH TRANSFER WILL NOT VIOLATE THE 1933 ACT. NO SALE,
PLEDGE OR OTHER TRANSFER MAY BE MADE TO ANY ONE PERSON FOR SECURITIES WITH A
FACE AMOUNT OF LESS THAN $[_________] AND, IN THE CASE OF ANY PERSON ACTING ON
BEHALF OF ONE OR MORE THIRD PARTIES (OTHER THAN A BANK (AS DEFINED IN SECTION
3(a)(2) OF THE 1933 ACT) ACTING IN ITS FIDUCIARY CAPACITY), FOR SECURITIES WITH
A FACE AMOUNT OF LESS THAN $[_________] FOR EACH SUCH THIRD PARTY.
EACH SECURITYHOLDER, BY ITS ACCEPTANCE OF THIS SECURITY, COVENANTS AND AGREES
THAT SUCH SECURITYHOLDER, SHALL NOT, PRIOR TO THE DATE THAT IS ONE YEAR AND ONE
DAY AFTER THE TERMINATION OF THE TRUST AGREEMENT, ACQUIESCE, PETITION OR
OTHERWISE INVOKE OR CAUSE THE TRUST, THE DEPOSITOR OR THE SELLER TO INVOKE THE
PROCESS OF ANY COURT OR GOVERNMENTAL AUTHORITY FOR THE PURPOSE OF COMMENCING OR
SUSTAINING A CASE AGAINST THE TRUST, THE DEPOSITOR OR THE SELLER UNDER ANY
FEDERAL OR STATE BANKRUPTCY, INSOLVENCY, REORGANIZATION OR SIMILAR LAW, OR
APPOINTING A RECEIVER, LIQUIDATOR, ASSIGNEE, TRUSTEE, CUSTODIAN, SEQUESTRATOR OR
OTHER SIMILAR OFFICIAL OF THE TRUST, THE DEPOSITOR OR THE SELLER OR ANY
SUBSTANTIAL PART OF ITS PROPERTY, OR ORDERING THE WINDING UP OR LIQUIDATION OF
THE AFFAIRS OF THE TRUST, THE DEPOSITOR OR THE SELLER.
[HIS CERTIFICATE WILL NOT BE REGISTERED FOR TRANSFER UNLESS THE OWNER TRUSTEE
RECEIVES EITHER (1) A REPRESENTATION FROM THE TRANSFEREE OF SUCH CERTIFICATE TO
THE EFFECT THAT SUCH TRANSFEREE NEITHER IS NOR IS ACTING ON BEHALF OF AN
EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT SUBJECT TO TITLE I OF THE
EMPLOYEE
A-2
RETIREMENT SECURITY ACT OF 1974, AS AMENDED ("ERISA"), SECTION 4975 OF THE
INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE "CODE") OR A GOVERNMENTAL PLAN
(AS DEFINED IN SECTION 3(32) OF ERISA) SUBJECT TO ANY FEDERAL, STATE OR LOCAL
LAW ("SIMILAR LAW") WHICH IS, TO A MATERIAL EXTENT, SIMILAR TO THE FOREGOING
PROVISIONS OF ERISA OR THE CODE (COLLECTIVELY, A "PLAN") AND IS NOT USING THE
ASSETS OF A PLAN SUBJECT TO ERISA OR THE CODE TO INVEST IN THE CERTIFICATES, (2)
IF THE TRANSFEREE IS A PLAN, OR IS ACTING ON BEHALF OF A PLAN TO INVEST IN THIS
CERTIFICATE, OR IS USING THE ASSETS OF A PLAN, AN OPINION OF COUNSEL
SATISFACTORY TO THE OWNER TRUSTEE TO THE EFFECT THAT SUCH TRANSFER WILL NOT
RESULT IN THE ASSETS OF THE TRUST BEING DEEMED TO BE "PLAN ASSETS" OR SUBJECT
THE DEPOSITOR, THE SELLER, THE SERVICER, THE OWNER TRUSTEE, OR THE INDENTURE
TRUSTEE TO ANY OBLIGATION IN ADDITION TO THOSE UNDERTAKEN IN THE TRUST
AGREEMENT, THE SALE AND SERVICING AGREEMENT AND THE ADMINISTRATION AGREEMENT,
INCLUDING ANY LIABILITIES ASSESSED FOR "PROHIBITED TRANSACTIONS" UNDER ERISA,
THE CODE OR SIMILAR LAW (3) IF THE TRANSFEREE IS AN INSURANCE COMPANY, A
REPRESENTATION THAT THE TRANSFEREE IS AN INSURANCE COMPANY THAT IS ACQUIRING
SUCH CERTIFICATES WITH FUNDS CONTAINED IN AN "INSURANCE COMPANY GENERAL ACCOUNT"
(AS SUCH TERM IS DEFINED IN SECTION V(e) OF PROHIBITED TRANSACTION CLASS
EXEMPTION 95-60 ("PTCE 95-60")) AND THAT THE PURCHASE AND HOLDING OF SUCH
CERTIFICATES AND ANY DEEMED EXTENSION OF CREDIT FROM A CERTIFICATEHOLDER WHICH
IS A PARTY IN INTEREST TO A PLAN, THE ASSETS OF WHICH ARE HELD BY SUCH
"INSURANCE COMPANY" ARE COVERED UNDER PTCE 95-60. ANY PURPORTED TRANSFER OF A
CERTIFICATE TO OR ON BEHALF OF A PLAN WITHOUT THE DELIVERY OF AN OPINION OF
COUNSEL REFERRED TO IN CLAUSE (2) ABOVE OR THE REPRESENTATION REFERRED TO IN
CLAUSE (3) ABOVE SHALL BE VOID AND OF NO EFFECT.
THE TRANSFEREE OF A BENEFICIAL INTEREST IN A BOOK-ENTRY TRUST CERTIFICATE SHALL
BE DEEMED TO REPRESENT EITHER (1) THAT IT IS NOT ACTING ON BEHALF OF A PLAN AND
IS NOT USING THE ASSETS OF A PLAN TO ACQUIRE SUCH INTEREST OR (2) THAT IT IS AN
INSURANCE COMPANY AND IS ACQUIRING SUCH INTEREST WITH FUNDS CONTAINED IN AN
INSURANCE COMPANY GENERAL ACCOUNT AND THAT THE PURCHASE AND HOLDING OF SUCH
INTEREST IS COVERED UNDER SECTION I AND III OF PTCE 95-60.]
[THIS CERTIFICATE IS NONTRANSFERABLE.]1/
- --------------------------
1/To be included only on the Certificates representing the 1% minimum required
to be retained by the Depositor and any Certificates issued in exchange
therefor.
A-3
NUMBER $_________
R- CUSIP NO. ______ __ _
WORLD OMNI AUTO RECEIVABLES TRUST [_____]-[_]
[___]% ASSET BACKED CERTIFICATE
evidencing a fractional undivided interest in the Trust, as defined below, the
property of which consists of retail installment sale contracts for new and used
automobiles, vans and light duty trucks (collectively, the "Receivables"), all
monies received on or after the related Cutoff Date, security interests in the
vehicles financed thereby, certain bank accounts and the proceeds thereof,
proceeds from claims on certain insurance policies and certain other rights
under the Trust Agreement and the Sale and Servicing Agreement and all proceeds
of the foregoing.
THIS TRUST CERTIFICATE DOES NOT REPRESENT AN INTEREST IN OR OBLIGATION OF WORLD
OMNI AUTO RECEIVABLES LLC, WORLD OMNI FINANCIAL CORP. OR ANY OF THEIR RESPECTIVE
AFFILIATES.
THIS CERTIFIES THAT ________________ is the registered owner
of ____________________________________________ DOLLARS nonassessable,
fully-paid, fractional undivided interest in World Omni Auto Receivables Trust
[___]-[_] (the "Trust"), formed by World Omni Auto Receivables LLC, a Delaware
limited liability company (the "Depositor").
OWNER TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Trust Certificates referred to in the within-mentioned Trust
Agreement. [____________________], not in its individual capacity, but solely as
Owner
[_____________________],
not in its individual capacity,
but solely as Owner Trustee
By: ___________________________
Authorized Signatory
A-4
The Trust was created pursuant to a Trust Agreement dated as
of [_____], [____], (as amended or supplemented from time to time, the "Trust
Agreement"), between the Depositor and [____________________], as owner trustee
(the "Owner Trustee"), a summary of certain of the pertinent provisions of which
is set forth below. To the extent not otherwise defined herein, the capitalized
terms used herein have the meanings assigned to them in the Trust Agreement or
the Sale and Servicing Agreement dated as of [_____],[_____] (as amended and
supplemented from time to time, the "Sale and Servicing Agreement"), among the
Trust, the Depositor and World Omni Financial Corp., as servicer (the
"Servicer"), as applicable.
This Certificate is one of the duly authorized Certificates
designated as "[___]% Asset Backed Certificates" (herein called the "Trust
Certificates"). Also issued under an Indenture dated as of [_____], [______]
(the "Indenture"), between the Trust and [_____________], as indenture trustee,
are the Notes designated as "[___]% Asset Backed Notes" (the "Notes"). This
Trust Certificate is issued under and is subject to the terms, provisions and
conditions of the Trust Agreement, to which Trust Agreement the Holder of this
Trust Certificate by virtue of its acceptance hereof assents and by which such
Holder is bound. The property of the Trust consists of retail installment sale
contracts for new and used automobiles, light duty trucks and vans
(collectively, the "Receivables"), all monies received on or after the Cutoff
Date plus all Payaheads as of the Cutoff Date; any proceeds with respect to the
Receivables from claims on any physical damage, credit life or disability,
theft, mechanical breakdown or "guaranteed auto protection" insurance policies
relating to Financed Vehicles or Obligors; proceeds of any recourse (but none of
the obligations) to Dealers on Receivables; any Financed Vehicle that shall have
secured a Receivable and shall have been acquired by or on behalf of the
Depositor, the Servicer, or the Trust; the Receivables Files; the Receivables
Purchase Agreement, including the right of the Depositor to cause World Omni to
purchase Receivables under certain circumstances; the Trust Accounts; and
certain other rights under the Trust Agreement and the Sale and Servicing
Agreement and all proceeds of the foregoing. The rights of the Holders of the
Trust Certificates are subordinated to the rights of the Holders of the Notes,
as and to the extent set forth in the Sale and Servicing Agreement. [The
Depositor's Interest shall also entitle the Depositor to the distributions
specified in Sections 5.06 and 5.07 of the Sale and Servicing Agreement.]
Under the Trust Agreement, there will be distributed [March
15, June 15, September 15 and December 15] of each year or, if such day is not a
Business Day, the immediately following Business Day (each, a "Distribution
Date"), commencing on [_______], [____], to the Person in whose name this Trust
Certificate is registered at the close of business on the last day of the month
immediately preceding such Distribution Date (the "Record Date"), such
Certificateholder's fractional undivided interest in the amount to be
distributed to Certificateholders on such Distribution Date. No distributions of
principal will be made on any Certificate on any Distribution Date until the
full amount of principal payable on the Notes on such Distribution Date has been
paid in full; provided, however, that if a Loss Trigger Event has occurred, no
distributions of principal (other than any Certificateholders' Principal
Carryover Shortfall outstanding as of the date of occurrence of such Loss
Trigger Event) will be made on any Certificate.
A-5
The Holder of this Trust Certificate acknowledges and agrees
that its rights to receive distributions in respect of this Trust Certificate
are subordinated to the rights of the Noteholders as described in the Sale and
Servicing Agreement and the Indenture.
It is the intent of the Depositor, the Servicer and the
Certificateholders that, for purposes of federal income, state and local income
and single business tax and any other income taxes, the Trust will be treated as
a partnership and the Certificateholders (including the Depositor) will be
treated as partners in that partnership. The Depositor and the other
Certificateholders, by acceptance of a Trust Certificate, agree to treat, and to
take no action inconsistent with the treatment of, the Trust Certificates for
such tax purposes as partnership interests in the Trust.
Each Certificateholder, or Certificate Owner, by its
acceptance of a Trust Certificate or, in the case of a Certificate Owner, a
beneficial interest in a Trust Certificate, covenants and agrees that such
Certificateholder or Certificate Owner, as the case may be, will not at any time
institute against the Depositor, or join in any institution against the
Depositor of, any bankruptcy, reorganization, arrangement, insolvency or
liquidation proceedings, or other proceedings under any United States federal or
state bankruptcy or similar law in connection with any obligations relating to
the Trust Certificates, the Notes, the Trust Agreement or any of the Basic
Documents.
Distributions on this Trust Certificate will be made as
provided in the Trust Agreement by the Owner Trustee by wire transfer or check
mailed to the Certificateholder of record in the Certificate Register without
the presentation or surrender of this Trust Certificate or the making of any
notation hereon. Except as otherwise provided in the Trust Agreement and
notwithstanding the above, the final distribution on this Trust Certificate will
be made after due notice by the Owner Trustee of the pendency of such
distribution and only upon presentation and surrender of this Trust Certificate
at the office or agency maintained for that purpose by the Owner Trustee in the
Borough of Manhattan, The City of New York.
Reference is hereby made to the further provisions of this
Trust Certificate set forth on the reverse hereof, which further provisions
shall for all purposes have the same effect as if set forth at this place.
Unless the certificate of authentication hereon shall have
been executed by an authorized officer of the Owner Trustee, by manual
signature, this Trust Certificate shall not entitle the Holder hereof to any
benefit under the Trust Agreement or the Sale and Servicing Agreement or be
valid for any purpose.
THIS TRUST CERTIFICATE SHALL BE CONSTRUED IN ACCORDANCE WITH
THE LAWS OF THE STATE OF DELAWARE, WITHOUT REFERENCE TO ITS CONFLICT OF LAW
PROVISIONS, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER
SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
IN WITNESS WHEREOF, the Owner Trustee, on behalf of the Trust
and not in its individual capacity, has caused this Trust Certificate to be duly
executed.
A-6
WORLD OMNI AUTO RECEIVABLES TRUST [____]-[_]
[_____________________],
not in its individual capacity but solely as
Owner Trustee,
Dated: _________________ By: ______________________________
Authorized Signatory
A-7
[REVERSE OF TRUST CERTIFICATE]
The Trust Certificates do not represent an obligation of, or
an interest in, the Depositor, the Servicer, the Seller, the Owner Trustee or
any affiliates of any of them and no recourse may be had against such parties or
their assets, except as expressly set forth or contemplated herein or in the
Trust Agreement or the Basic Documents. In addition, this Trust Certificate is
not guaranteed by any governmental agency or instrumentality and is limited in
right of payment to certain collections and recoveries with respect to the
Receivables (and certain other amounts), all as more specifically set forth
herein and in the Sale and Servicing Agreement. A copy of each of the Sale and
Servicing Agreement and the Trust Agreement may be examined by any
Certificateholder upon written request during normal business hours at the
principal office of the Depositor and at such other places, if any, designated
by the Depositor.
The Trust Agreement permits, with certain exceptions therein
provided, the amendment thereof and the modification of the rights and
obligations of the Depositor and the rights of the Certificateholders under the
Trust Agreement at any time by the Depositor and the Owner Trustee with the
consent of the Holders of the Trust Certificates and the Notes, each voting as a
class, evidencing not less than a majority of the Certificate Balance and the
outstanding principal balance of the Notes. Any such consent by the Holder of
this Trust Certificate shall be conclusive and binding on such Holder and on all
future Holders of this Trust Certificate and of any Trust Certificate issued
upon the transfer hereof or in exchange herefor or in lieu hereof, whether or
not notation of such consent is made upon this Trust Certificate. The Trust
Agreement also permits the amendment thereof, in certain limited circumstances,
without the consent of the Holders of any of the Trust Certificates.
As provided in the Trust Agreement and subject to certain
limitations therein set forth, the transfer of this Trust Certificate is
registerable in the Certificate Register upon surrender of this Trust
Certificate for registration of transfer at the offices or agencies of the
Certificate Registrar maintained by the Owner Trustee in the Borough of
Manhattan, The City of New York, accompanied by a written instrument of transfer
in form satisfactory to the Owner Trustee and the Certificate Registrar duly
executed by the Holder hereof or such Holder's attorney duly authorized in
writing, and thereupon one or more new Trust Certificates of authorized
denominations evidencing the same aggregate interest in the Trust will be issued
to the designated transferee. The initial Certificate Registrar appointed under
the Trust Agreement is the Owner Trustee.
Except as provided in the Trust Agreement, the Trust
Certificates are issuable only as registered Trust Certificates without coupons
in denominations of $[_______] and in integral multiples of $[_____] in excess
thereof. As provided in the Trust Agreement and subject to certain limitations
therein set forth, Trust Certificates are exchangeable for new Trust
Certificates of authorized denominations evidencing the same aggregate
denomination, as requested by the Holder surrendering the same. No service
charge will be made for any such registration of transfer or exchange, but the
Owner Trustee or the Certificate Registrar may require payment of a sum
sufficient to cover any tax or governmental charge payable in connection
therewith.
A-8
The Owner Trustee, the Certificate Registrar and any agent of
the Owner Trustee or the Certificate Registrar may treat the Person in whose
name this Certificate is registered as the owner hereof for all purposes, and
none of the Owner Trustee, the Certificate Registrar or any such agent shall be
affected by any notice to the contrary.
The obligations and responsibilities created by the Trust
Agreement and the Trust created thereby shall terminate upon the payment to
Certificateholders of all amounts required to be paid to them pursuant to the
Trust Agreement and the Sale and Servicing Agreement and the disposition of all
property held as part of the Owner Trust Estate. The Servicer of the Receivables
may at its option purchase the Owner Trust Estate at a price specified in the
Sale and Servicing Agreement, and such purchase of the Receivables and other
property of the Trust will effect early retirement of the Trust Certificates;
however, such right of purchase is exercisable only as of the last day of any
Collection Period as of which the Pool Balance is less than or equal to 5% of
the Original Pool Balance.
A-9
ASSIGNMENT
FOR VALUE RECEIVED the undersigned hereby sells, assigns and
transfers unto
PLEASE INSERT SOCIAL SECURITY OR
OTHER IDENTIFYING NUMBER OF ASSIGNEE
- -------------------------------------------------------------------------------
(Please print or type name and address, including postal zip code, of assignee)
the within Trust Certificate, and all rights thereunder, and hereby irrevocably
constitutes and appoints ------, attorney, to transfer said Trust Certificate on
the books of the Certificate Registrar, with full power of substitution in the
premises.
Dated:
________________________________________*/
Signature Guaranteed:
____________________________*/
- ---------
*/ NOTICE: The signature to this assignment must correspond with the name as it
appears upon the face of the within Trust Certificate in every particular,
without alteration, enlargement or any change whatever. Such signature must be
guaranteed by a member firm of the New York Stock Exchange or a commercial bank
or trust company.
A-10
EXHIBIT B
CERTIFICATE OF TRUST OF
WORLD OMNI AUTO RECEIVABLES TRUST [ ]-[_]
THIS Certificate of Trust of WORLD OMNI AUTO RECEIVABLES
TRUST [____]-[_] (the "Trust"), dated [______], [____] (, is being duly executed
and filed by [____________________], a Delaware banking corporation, as trustee,
to form a business trust under the Delaware Business Trust Act (12 Del. C. ss.
3801 et seq.).
1. Name. The name of the business trust formed hereby is
World Omni Auto Receivables Trust [____]-[_].
2. Delaware Trustee. The name and business address of the
trustee of the Trust in the State of Delaware is [_________________],
[______________], Attn: [__________]
3. Effective Date. This Certificate of Trust shall be
effective upon filing with the Secretary of State.
IN WITNESS WHEREOF, the undersigned, being the sole trustee of
the Trust, has executed this Certificate of Trust as of the date first-above
written.
[____________________],
as Trustee,
By: _______________________________
Name:
Title:
B-1
EXHIBIT C
FORM OF TRANSFEROR CERTIFICATE
[DATE]
World Omni Auto Receivables LLC
120 N.W. 12th Avenue
Deerfield Beach, FL 33442
[____________________], as Owner Trustee
[ ]
Re: World Omni Auto Receivables Trust [____]-[_]
[___]% Asset Backed Certificates
Ladies and Gentlemen:
In connection with our disposition of the above-referenced
[___]% Asset Backed Certificates (the "Certificates") we certify that (a) we
understand that the Certificates have not been registered under the Securities
Act of 1933, as amended (the "Act"), and are being transferred by us in a
transaction that is exempt from the registration requirements of the Act and (b)
we have not offered or sold any Certificates to, or solicited offers to buy any
Certificates from, any person, or otherwise approached or negotiated with any
person with respect thereto, in a manner that would be deemed, or taken any
other action which would result in, a violation of Section 5 of the Act.
Very truly yours,
[NAME OF TRANSFEROR]
By: _________________________________
Authorized Officer
C-1
EXHIBIT D
FORM OF INVESTMENT LETTER
World Omni Auto Receivables LLC
120 N.W. 12th Avenue
Deerfield Beach, FL 33442
[____________________], as Owner Trustee
[ ]
Ladies and Gentlemen:
In connection with our proposed purchase of [$_______]
aggregate principal amount of [___]% Asset Backed Certificates (the
"Certificates") of World Omni Auto Receivables Trust [____]-[_] (the "Issuer"),
we confirm that:
1. We understand that the Certificates have not been
registered under the Securities Act of 1933, as amended (the "1933
Act"), and may not be sold except as permitted in the following
sentence. We understand and agree, on our own behalf and on behalf of
any accounts for which we are acting as hereinafter stated, (x) that
such Certificates are being offered only in a transaction not involving
any public offering within the meaning of the 1933 Act and (y) that
such Certificates may be resold, pledged or transferred only (i) to the
Depositor, (ii) to an "accredited investor" as defined in Rule
501(a)(1),(2),(3) or (7) (an "Accredited Investor") under the 1933 Act
acting for its own account (and not for the account of others) or as a
fiduciary or agent for others (which others also are Accredited
Investors unless the holder is a bank acting in its fiduciary capacity)
that executes a certificate substantially in the form hereof, (iii) so
long as such Certificate is eligible for resale pursuant to Rule 144A
under the 1933 Act ("Rule 144A"), to a person whom we reasonably
believe after due inquiry is a "qualified institutional buyer" as
defined in Rule 144A, acting for its own account (and not for the
account of others) or as a fiduciary or agent for others (which others
also are "qualified institutional buyers") to whom notice is given that
the resale, pledge or transfer is being made in reliance on Rule 144A
or (iv) in a sale, pledge or other transfer made in a transaction
otherwise exempt from the registration requirements of the 1933 Act, in
which case the Owner Trustee shall require that both the prospective
transferor and the prospective transferee certify to the Owner Trustee
and the Depositor in writing the facts surrounding such transfer, which
certification shall be in form and substance satisfactory to the Owner
Trustee and the Depositor. Except in the case of a transfer described
in clauses (i) or (iii) above, the Owner Trustee shall require a
written opinion of counsel (which will not be at the expense of the
Depositor, any affiliate of the Depositor or the Owner Trustee)
satisfactory to the Depositor and the Owner Trustee be delivered to the
Depositor and the Owner Trustee to the effect that such transfer will
not violate the 1933 Act, in each case in accordance with any
applicable securities laws of any state of the United States. We will
notify any purchaser of the Certificates from us of the above resale
restrictions, if then applicable. We further understand that in
connection with any transfer of the Certificates by us that the
Depositor and the Owner Trustee may request,
D-1
and if so requested we will furnish such certificates and other
information as they may reasonably require to confirm that any such
transfer complies with the foregoing restrictions. We understand that
no sale, pledge or other transfer may be made to any one person of
Certificates with a face amount of less than $[______] and, in the case
of any person acting on behalf of one or more third parties (other than
a bank (as defined in Section 3(a)((2) of the 1933 Act) acting in its
fiduciary capacity), of Certificates with a face amount of less than
$[_________] for each such third party.
2. [CHECK ONE]
(a) We are an "accredited investor" (as defined in
Rule 501(a)(1),(2),(3) or (7) of Regulation D under
the Certificates Act) acting for our own account (and
not for the account of others) or as a fiduciary or
agent for others (which others also are Accredited
Investors unless we are a bank acting in its
fiduciary capacity). We have such knowledge and
experience in financial and business matters as to be
capable of evaluating the merits and risks of our
investment in the Certificates, and we and any
accounts for which we are acting are each able to
bear the economic risk of our or their investment for
an indefinite period of time. We are acquiring the
Certificates for investment and not with a view to,
or for offer and sale in connection with, a public
distribution.
(b) We are a "qualified institutional buyer" as
defined under Rule 144A under the 1933 Act and are
acquiring the Certificates for our own account (and
not for the account of others) or as a fiduciary or
agent for others (which others also are "qualified
institutional buyers"). We are familiar with Rule
144A under the 1933 Act and are aware that the seller
of the Certificates and other parties intend to rely
on the statements made herein and the exemption from
the registration requirements of the 1933 Act
provided by Rule 144A.
3. [We are not (i) an employee benefit plan (as
defined in Section 3(3) of the Employee Retirement Income Security Act
of 1974, as amended ("ERISA")) that is subject to the provisions of
Title I of ERISA, (ii) a plan described in Section 4975(e)(1) of the
Code or (iii) any entity whose underlying assets include plan assets by
reason of a plan's investment in the entity (each, a "Benefit Plan").
We hereby acknowledge that no transfer of any Certificate shall be
permitted to be made to any person unless the Trustee has received (i)
a certificate from such transferee to the effect of the preceding
sentence, (ii) an opinion of counsel satisfactory to the Trustee to the
effect that the purchase and holding of any such Certificate will not
constitute or result in the assets of the Issuer being deemed to be
"plan assets" and subject to the prohibited transaction provisions of
ERISA or Section 4975 of the Code and will not subject the Owner
Trustee, the Indenture Trustee or the Depositor to any obligation in
addition to those undertaken in the Basic Documents with respect to the
Certificates (provided, however, that the Owner Trustee will not
require such certificate or opinion in the event that, as a result of
change of law or otherwise, counsel satisfactory to the Owner Trustee
has rendered an opinion to the effect that the purchase and holding of
any such Certificate by a Benefit Plan or a Person that is purchasing
or holding
D-2
any such Certificate with the assets of a Benefit Plan will not
constitute or result in a prohibited transaction under ERISA or Section
4975 of the Code) or (iii) if the transferee is an insurance company, a
representation that the transferee is an insurance company that is
acquiring such Certificates with funds contained in an "Insurance
Company General Account" (as such term is defined in Section V(e) of
Prohibited Transaction Class Exemption 95-60 ("PTCE 95-60)) and that
the purchase and holding of such Certificates and any deemed extension
of credit from a Certificateholder which is a party in interest to a
Plan, the assets of which are held by such "Insurance Company" are
covered under PTCE 95-60.]
4. We understand that the Depositor, the Trust and
others will rely upon the truth and accuracy of the foregoing
acknowledgments, representations and agreements, and we agree that if
any of the acknowledgments, representations and warranties deemed to
have been made by us by our purchase of the Certificates, for our own
account or for one or more accounts as to each of which we exercise
sole investment discretion, are no longer accurate, we shall promptly
notify the Depositor.
5. You are entitled to rely upon this letter and you
are irrevocably authorized to produce this letter or a copy hereof to
any interested party in any administrative or legal proceeding or
official inquiry with respect to the matters covered hereby.
Very truly yours,
[NAME OF PURCHASER]
By: _________________________________
Name:
Title:
Date: _______________________________
D-3
ANNEX A
TAX PARTNERSHIP PROVISIONS
1. Characterization for Tax Purposes. For United States
federal and applicable state and local income tax purposes, the Depositor's
contribution of the Receivables to the Trust in exchange for interests in the
Trust, and the sale by the Depositor of the Certificates (other than the
retention by the Depositor of the Depositor's Trust Certificate) is intended to
constitute the formation of a partnership (the "Tax Partnership") whose partners
are the Certificateholders (which are hereinafter collectively referred to as
the "Tax Partners"). The Servicer, on behalf of the Tax Partners, shall elect
pursuant to Treasury Regulation Section 301.7701-3(b)(1) to treat the Trust as a
partnership for federal income tax purposes (and shall not elect to treat the
Trust or to change the classification of the Trust to that of an association
pursuant to Treasury Regulation Section 301.7701-3(c)), and each Tax Partner
irrevocably agrees to be bound by such election.
2. Election with Respect to Subchapter K. Notwithstanding
anything to the contrary, each Tax Partner agrees: (a) not to elect to be
excluded from the application of Subchapter K of Chapter 1 of Subtitle A of the
Code, or any comparable provisions of applicable state laws; and (b) to join in
the execution of such additional documents and elections as may be required in
order to effectuate the foregoing.
3. Capital Contributions and Capital Accounts.
(a) The value of the interests contributed by the
Certificateholders (other than the Depositor) shall equal the amount
paid by such Certificateholders, respectively, for their Certificates
and such amounts shall constitute the opening balance in their Capital
Accounts (as hereinafter defined). The value of the interests
contributed by the Depositor shall equal the fair market value of the
Depositor's Interest, which the Tax Partners agree shall be based on
the sum, without duplication, of (i) the Reserve Account Initial
Deposit and (ii) the value of the Depositor's Interest based on (A) as
to the Certificate Balance and interest at the Pass-Through Rate of the
Depositor's Trust Certificate, the average price of the Certificates to
investors and (B) as to all other amounts due the Depositor, the
present value of the cash flow to the Depositor of the amounts to which
the Depositor is entitled to receive pursuant to Sections 5.05(b)(viii)
and 5.06(b) and (e) of the Sale and Servicing Agreement at each
Distribution Date or upon termination of the Trust using a discount
rate that reflects an appropriate arm's-length equity rate of return
and a prepayment assumption of 1.75 ABS, and such total shall be
submitted to the Owner Trustee in writing within ten (10) Business Days
after the Closing Date. Such amount shall constitute the opening
balance in the Depositor's Capital Account.
(b)An individual capital account (a "Capital
Account") shall be maintained for each Tax Partner in compliance with
Treasury Regulation Sections 1.704-1(b)(2)(iv) and 1.704-2 and
accordingly, except as otherwise provided herein:
(i) The Capital Account of each Tax Partner shall be
credited by (A) the amount of cash and the fair market value
of property other than cash
contributed (or deemed contributed pursuant to Code Section
708) by such Tax Partner to the Tax Partnership (net of any
liabilities assumed by the Tax Partnership upon such
contribution or to which such property is subject at the time
of such contribution); and (B) the amount of any item of
taxable income or gain and the amount of any item of income or
gain exempt from tax allocated to such Tax Partner.
(ii) The Capital Account of each Tax Partner shall
be debited by (A) the amount of any item of tax deduction or
loss allocated to such Tax Partner; (B) such Tax Partner's
allocable share of expenditures not deductible in computing
taxable income and not properly chargeable as capital
expenditures; and (C) the amount of cash and the fair market
value of any property other than cash (net of any liabilities
assumed by such Tax Partner or to which such property is
subject at the time of distribution) distributed to such Tax
Partner.
(iii) Immediately prior to any distribution of
property in kind, the Tax Partners' Capital Accounts shall be
adjusted by assuming that the distributed properties were sold
for cash at their respective fair market values as of the date
of distribution and crediting or debiting each Tax Partner's
Capital Account with its respective share of the hypothetical
gains or losses resulting from such assumed sales in the same
manner as gains or losses on actual sales of such properties
would be allocated under Paragraph 6 below.
5. Federal and State Income Tax Returns and Elections.
(a) The Tax Partners agree that the Depositor shall
serve as the "tax matters partner" (as such term is defined in Code
Section 6231(a)(7) (the "Tax Matters Partner") of the Tax Partnership.
The Tax Matters Partner shall (i) apply to the Internal Revenue Service
for a taxpayer identification number for the Tax Partnership, (ii)
elect to adopt the accrual method of accounting and the calendar year
as the Tax Partnership's fiscal year (the "Fiscal Year"), (iv) make
such other elections as it deems proper, (v) prepare, execute and file
the necessary federal and state partnership income tax returns for the
Tax Partnership and (vi) keep the other Tax Partners informed of all
material matters that may come to its attention in its capacity as Tax
Matters Partner. Each Tax Partner agrees to furnish the Tax Matters
Partner with all pertinent information relating to activities under
this Agreement which is necessary for the Tax Matters Partner to
prepare and file federal and state partnership returns. In acting as
Tax Matters Partner, the Tax Matters Partner shall use its best
efforts, but shall incur no liability to the other Tax Partners.
(b) Within 60 days after the end of each of the Tax
Partnership's taxable years, the Tax Matters Partner shall send to each
Tax Partner who has been a Tax Partner at any time during the taxable
year then ended such tax information as shall be necessary for the
preparation by such Tax Partner of its Federal income tax return and
state income and other tax returns, if any, in states where the Tax
Partnership is organized or is qualified to do business.
2
6. Allocations.
(a)(i) "Net Income" and "Net Loss" respectively, for
any period, means the income or losses of the Tax Partnership as
determined in accordance with the method of accounting followed by the
Tax Partnership for Federal income tax purposes, including, for all
purposes, any income exempt from tax and any expenditures of the Tax
Partnership described in Code Section 705(a)(2)(B); provided, however,
(i) that any item allocated under Paragraph 6(c) shall be excluded from
the computation of Net Loss and (ii) that if, as a result of the
contribution of an asset whose fair market value differs from its
adjusted basis for Federal income tax purposes or as a result of the
revaluation of the Tax Partnership's assets, the book value of any Tax
Partnership asset differs from its adjusted basis for Federal income
tax purposes, gain, loss, depreciation and amortization with respect to
such assets shall be computed using the asset's book value consistently
with the requirements of Treasury Regulation Section
1.704-1(b)(2)(iv)(g).
(ii) "Period" shall mean the period ending on each
Distribution Date; provided that as to the month in which the
Closing Date occurs, Period shall mean the period commencing
on the Closing Date and ending on the first Distribution Date
and as to the period in which the Tax Partnership terminates,
Period shall mean the period beginning on the first day of
such period and ending on the date of the Tax Partnership's
termination.
(b) The Tax Partners agree that the Tax Partnership's
Net Income and Net Loss and each item of income, gain, loss, or
deduction entering into the computation thereof for any Fiscal Year
shall be allocated by first allocating the Tax Partnership's Net Income
and Net Loss (and each item of income, gain, loss, or deduction
entering into the computation thereof) for each Period or portion
thereof within such Fiscal Year (as if such Period (or portion) were a
complete fiscal year), dividing the amount of such allocations for the
Period ending March 15 on a daily basis between calendar years and then
aggregating the allocations for the portion of such Period within each
Fiscal Year; provided, that the Tax Partnership's Net Income or Net
Loss for the period commencing December 18 and ending December 31 may
be determined on an estimated basis to permit timely preparation of the
Partnership's tax returns and reporting to the Tax Partners. In the
case of the transfer of any interest in the Tax Partnership, the items
of Net Income and Net Loss allocated for any Period with respect to the
transferred interest shall be allocated between the transferor and
transferee of such interest on a daily basis within such Period. The
Tax Partnership's Net Income and Net Loss for each Period within a
Fiscal Year shall be allocated as follows:
(i) Net Income for such Period shall be allocated as
follows:
(A) An amount of Net Income equal to the excess
of (x) the sum for such Period and each preceding
Period up to the Period beginning with the Closing
Date, of (1) the product of the Pass-Through Rate and
(2) the Certificate Balance amount for such Period
(and each such preceding Period) over (y) all amounts
allocated to the Certificateholders pursuant to this
Paragraph 6(b)(i)(A) shall be allocated 100% to the
Certificateholders (including the Depositor), in
proportion to their holdings
3
of Trust Certificates; provided that the product
of (1) and (2) in clause (x) shall be computed on the
basis of a 360 day year consisting of twelve 30 day
months.
(B) An amount of Net Income equal to the excess
of (x) the sum for such Period and each preceding
Period up to the Period beginning with the Closing
Date, of that portion of any excess of the principal
amount of the Trust Certificates over their initial
issue price (disregarding accrued interest) that
would have accrued with respect to such Periods if
the Trust Certificates were indebtedness and such
excess were original issue discount over (y) all
amounts previously allocated to the
Certificateholders pursuant to this Paragraph
6(b)(i)(B) shall be allocated 100% to the
Certificateholders (including the Depositor), in
proportion to their holdings of Trust Certificates.
(C) Any remaining Net Income shall be allocated
100% to the Depositor.
(ii) Net Losses for such Period shall be
allocated as follows:
(A) 100% to the Depositor until the excess of the
Adjusted Capital Account (as hereinafter defined)
balance of the Depositor over the amount specified in
Paragraph 3(a)(i)(A) (as adjusted for all prior
distributions of principal and accruals of market
discount income allocable to the Depositor) equals
zero.
(B) 100% to the Certificateholders (including the
Depositor) in proportion to their holdings of Trust
Certificates, until the Adjusted Capital Account
balances of the Certificateholders equal zero; and
(C) Any remaining Net Losses shall be allocated
100% to the Depositor.
(c)(i) Any deductions attributable to (w) the
amortization of premium on the Receivables, (x) payments to the Owner
Trustee, (y) payments to the Servicer and (z) payments of any other
expenses, claims and losses of the Trust shall be specially allocated
to the Depositor.
(ii) If there is a net decrease in "partnership
minimum gain" (within the meaning of Treasury Regulation
Section 1.704-2(d)) for a Fiscal year, then there shall be
allocated to each Tax Partner items of income and gain for
that year equal to that Tax Partner's share of the net
decrease in partnership minimum gain (within the meaning of
Treasury Regulation Section 1.704-2(g)(2)), subject to the
exceptions set forth in Treasury Regulation Sections
1.704-2(f)(2), (3) and (5), provided, that if the Tax
Partnership has any discretion as to an exception set forth
pursuant to Treasury Regulation Section 1.704-2(f)(5), the
Tax Matters Partner may exercise such discretion on behalf of
the Tax Partnership. In the event the application of the
minimum gain chargeback requirement would cause a distortion
in
4
the economic arrangement among the Tax Partners, the Tax
Matters Partner shall request the Commissioner to waive the
minimum gain chargeback requirement pursuant to Treasury
Regulation Section 1.704-2(f)(4). The foregoing is intended
to be a "minimum gain chargeback" provision as described in
Treasury Regulation Section 1.704-2(f) and shall be
interpreted and applied in all respects in accordance with
that Treasury Regulation.
If during a Fiscal Year there is a net decrease in
partner nonrecourse debt minimum gain (as determined in
accordance with Treasury Regulation Section 1.704-2(i)(3)),
then, in addition to the amounts, if any, allocated pursuant
to the preceding paragraph, any Tax Partner with a share of
that partner nonrecourse debt minimum gain (determined in
accordance with Treasury Regulation Section 1.704-2(i)(5)) as
of the beginning of the Fiscal Year shall, subject to the
exceptions set forth in Treasury Regulation Section
1.704-2(i)(4), including exceptions analogous to those
provided pursuant to Treasury Regulation Sections
1.704-2(f)(2), (3) and (5) (provided, that if the Tax
Partnership has any discretion as to an exception set forth
pursuant to Treasury Regulation Section 1.704-2(f)(5) as made
applicable by Treasury Regulation Section 1.704-2(i)(4), the
Tax Matters Partner may exercise such discretion on behalf of
the Tax Partnership) be allocated items of income and gain
for the year (and, if necessary, for succeeding years) equal
to that Tax Partner's share of the net decrease in the
partner nonrecourse minimum gain. In the event the
application of the minimum gain chargeback requirement would
cause a distortion in the economic arrangement among the Tax
Partners, the Tax Matters Partner shall request the
Commissioner to waive the minimum gain chargeback requirement
pursuant to Treasury Regulation Sections 1.704-2(i)(4) and
1.704-2(f)(4). The foregoing is intended to be the
"chargeback of partner nonrecourse debt minimum gain"
required by Treasury Regulation Section 1.704-2(i)(4) and
shall be interpreted and applied in all respects in
accordance with that Treasury Regulation.
(iii) If during any Fiscal year of the Tax
Partnership a Tax Partner unexpectedly receives an
adjustment, allocation or distribution described in Treasury
Regulation Sections 1.704-1(b)(2)(ii)(d)(4), (5) or (6),
which causes or increases a deficit balance in the Tax
Partner's Adjusted Capital Account (as defined below), there
shall be allocated to the Tax Partner items of income and
gain (consisting of a pro rata portion of each item of Tax
Partnership income, including gross income, and gain for such
year) in an amount and manner sufficient to eliminate such
deficit as quickly as possible. The foregoing is intended to
be a "qualified income offset" provision as described in
Treasury Regulation Section 1.704-1(b)(2)(ii)(d) and shall be
interpreted and applied in all respects in accordance with
the Treasury Regulation.
A Tax Partner's "Adjusted Capital Account", at any
time, shall equal the Tax Partner's Capital Account at such
time (x) increased by the sum of (A) the amount of the Tax
Partner's share of partnership minimum gain (as defined in
Treasury Regulation Section 1.704-2(g)(1) and (3)), (B) the
amount of the Tax Partner's share of partner nonrecourse debt
minimum gain (as defined in Treasury Regulation Section
1.704-2(i)(5)), and (C) any amount of the deficit balance in
its
5
Capital Account and Tax Partner is obligated to restore
on liquidation of the Tax Partnership and (y) decreased by
reasonably expected adjustments, allocations and
distributions described in Treasury Regulation Sections
1.704-1(b)(2)(ii)(d)(4), (5) and (6).
(iv) Notwithstanding anything to the contrary in
this Paragraph 6, Tax Partnership losses, deductions, or Code
Section 705(a)(2)(B) expenditures that are attributable to a
particular partner nonrecourse liability shall be allocated
to the Tax Partner that bears the economic risk of loss for
the liability in accordance with the rules of Treasury
Regulation Section 1.704-2(i).
(v) Notwithstanding any provision of Paragraphs
6(b) and 6(c)(i), no allocation of items of loss or deduction
shall be made to a Tax Partner if it would cause the Tax
Partner to have a negative balance in its Adjusted Capital
Account. Allocations of items of loss or deduction that would
be made to a Tax Partner but for this Paragraph 6(c)(v) shall
instead be made first to the Depositor to the extent not
inconsistent with this Paragraph 6(c)(v), and second, to the
Certificateholders in proportion to the amounts distributable
for the related Period pursuant to Sections 5.06(a)(ii)(C)
and (D) or (v) of the Sale and Servicing Agreement, to the
extent distributions under either such Section were reduced.
To the extent allocations of items of loss or deduction
cannot be made to any Tax Partner because of this Paragraph
6(c)(v), such allocations shall be made to the Tax Partners
in accordance with Paragraphs 6(b) and 6(c)(i)
notwithstanding this Paragraph 6(c)(v).
(vi) To the extent that any item of income, gain,
loss or deduction has been specially allocated pursuant to
Paragraphs 6(c)(iii) and (v) and such allocation is
inconsistent with the way in which the same amount otherwise
would have been allocated under Paragraphs 6(b) and 6(c)(i),
subsequent allocations under Paragraph 6(b) and 6(c)(i) shall
be made, to the extent possible and without duplication, in a
manner consistent with Paragraphs 6(c)(ii), (iii), (iv) and
(v) which negate as rapidly as possible the effect of all
such inconsistent allocations.
(vii) Any allocations made pursuant to this
Paragraph 6 shall be made in the following order:
(i) Paragraph 6(c)(ii)
(ii) Paragraph 6(c)(iii)
(iii) Paragraph 6(c)(iv)
(iv) Paragraph 6(c)(vi)
(v) Paragraph 6(c)(i)
(vi) Paragraph 6(b)(i) and (ii)
6
These provisions shall be applied as if all
distributions and allocations were made at the end of
the Fiscal Year. Where any provision depends on the
Capital Account of any Tax Partner, that Capital
Account shall be determined after the operation of
all preceding provisions for the year. These
allocations shall be made consistently with the
requirements of Treasury Regulation Section
1.704-2(j).
(d) The income, gains, losses, deductions and credits
of the Tax Partnership for Federal, state and local income tax purposes
shall be allocated in the same manner as the corresponding items
entering into the computation of Net Income and Net Losses were
allocated pursuant to Paragraphs 6(b) and (c) provided that solely for
Federal, local and state income and franchise tax purposes and not for
book or Capital Account purposes, income, gain, loss and deduction with
respect to property properly carried on the Tax Partnership's books at
a value other than its tax basis shall be allocated (i) in the case of
property contributed in kind, in accordance with the requirements of
Code Section 704(c) and such Treasury Regulations as may be promulgated
thereunder from time to time, and (ii) in the case of other property,
in accordance with the principles of Code Section 704(c) and the
Treasury Regulations thereunder as incorporated among the requirements
of the relevant provisions of the Treasury Regulations under Code
Section 704(b).
(e) The Tax Partnership shall comply with all
withholding requirements under Federal, state and local law and shall
remit amounts withheld to and file required forms with the applicable
jurisdictions. To the extent the Tax Partnership is required to
withhold and pay over any amounts with respect to distributions or
allocations to any Tax Partner, the amount withheld shall be treated as
a distribution to that Tax Partner. In the event of any claimed
overwithholding, Tax Partners shall have no claim for recovery against
the Tax Partnership or other Tax Partners. If the amount withheld was
not withheld from actual distributions, the Tax Partnership, may at its
option, (i) require the Tax Partner to reimburse the Tax Partnership
for such withholding (and each Tax Partner agrees to reimburse the Tax
Partnership 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. Tax Partner), the
Tax Partnership may in its sole discretion withhold such amounts in
accordance with this Partnership may in its sole discretion withhold
such amounts in accordance with this Paragraph 6(e). Each Tax Partner
agrees to furnish the Tax Partnership with any representations and
forms as shall reasonably be requested by the Tax Partnership to assist
it in determining the extent of, and in fulfilling, its withholding
obligations. If a Tax Partner wishes to apply for a refund of any such
withholding tax, the Owner Trustee shall reasonably cooperate with such
Tax Partner in making such claim as long as the Tax Partner agrees to
reimburse the Tax Partnership for any out-of-pocket expenses incurred.
7. Sale of Interests. The Tax Partners agree that any sale by
a Tax Partner of any ownership interest in a Trust Certificate shall be deemed
to be a sale of all or a portion of such Tax Partner's interest in the Tax
Partnership.
8. Termination of a Tax Partner's Interest. Any distribution
by the Tax Partnership in termination of any Tax Partner's interest in the Tax
Partnership other than
7
pursuant to Paragraph 9 below shall be in an amount of cash or property other
than cash having a net fair market value equal to the positive Capital Account
balance of such Tax Partner at the time such interest is terminated, after such
Capital Account balance has been adjusted in accordance with Paragraphs 4 and 6
above for all operations preceding such distribution and the applicable Treasury
Regulations under Code Section 704(b), and shall be made by the later of: (a)
the end of the Tax Partnership's taxable year in which such termination occurs;
or (b) within 90 days after the date of such termination.
9. Distributions upon Termination. Upon termination of the
Agreement pursuant to its terms, the activities of the Tax Partners under this
Annex A shall be concluded and the assets subject to the Agreement and this
Annex A shall be distributed to the Tax Partners in the manner and in the order
set forth below:
(a) Debts of the Tax Partnership created pursuant to the
Indenture on the Trust Agreement, other than to Tax Partners, shall be
paid.
(b) All cash on hand representing unexpended contributions
by any Tax Partner shall be returned to the contributor.
(c) The Tax Partners' Capital Accounts shall be adjusted by:
(i) assuming the sale of all remaining assets at their fair market
values as of the date of termination of the Trust Agreement; and (ii)
debiting or crediting each Tax Partner's Capital Account with the Tax
Partner's respective share of the hypothetical gains or losses
resulting from such assumed sales in the same manner as such Tax
Partner's Capital Account would be debited or credited under Paragraph
6 above for gains or losses on actual sales of such properties.
(d) All Tax Partnership assets shall be distributed to the
Tax Partners in accordance with their respective Capital Account
balances as so adjusted by the later of: (i) the end of the Tax
Partnership's taxable year in which the termination occurs; or (ii)
within 90 days after the date of such termination.
If property subject to the Agreement is distributed pursuant to this paragraph,
the amount of the distribution shall be equal+ to the net fair market value of
the distributed property.
8