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Exhibit 4.3
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TRUST AGREEMENT
among
[ ]
as Seller,
Fleet Home Equity Loan Corporation
as Depositor,
and
[ ],
as Owner Trustee
Dated as of [ ]
[ ] HOME EQUITY LOAN TRUST 200_-_
Home Equity Loan Asset-Backed Notes, Series 200_-_
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Table of Contents
Page
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ARTICLE I
DEFINITIONS
Section 1.1 Capitalized Terms................................................................. 1
Section 1.2 Other Definitional Provisions..................................................... 4
ARTICLE II
ORGANIZATION
Section 2.1 Name.............................................................................. 5
Section 2.2 Office............................................................................ 5
Section 2.3 Purposes and Powers............................................................... 5
Section 2.4 Appointment of Owner Trustee...................................................... 6
Section 2.5 Initial Capital Contribution of Owner Trust Estate................................ 6
Section 2.6 Declaration of Trust.............................................................. 6
Section 2.7 Title to Trust Property........................................................... 6
Section 2.8 Situs of Trust.................................................................... 6
Section 2.9 Representations and Warranties of the Depositor................................... 7
Section 2.10 Federal Income Tax Allocations.................................................... 8
ARTICLE III
OWNERSHIP INTEREST AND TRANSFERS OF THE OWNERSHIP INTEREST
Section 3.1 Initial Ownership................................................................. 9
Section 3.2 The Ownership Interest............................................................ 9
Section 3.3 [Reserved]........................................................................ 9
Section 3.4 Registration of Transfer and Exchange of Ownership Interest....................... 9
Section 3.5 [Reserved]........................................................................ 9
Section 3.6 Persons Deemed Transferors........................................................ 9
Section 3.7 [Reserved]........................................................................ 9
Section 3.8 Maintenance of Office or Agency................................................... 9
Section 3.9 Appointment of Paying Agent....................................................... 10
Section 3.10 [Reserved]........................................................................ 10
Section 3.11 [Reserved]........................................................................ 10
Section 3.12 [Reserved]........................................................................ 10
Section 3.13 Restrictions on Transfers of Ownership Interest................................... 10
ARTICLE IV
ACTIONS BY OWNER TRUSTEE
Section 4.1 Prior Notice to the Transferor and the Insurer with Respect to Certain Matters.... 13
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Section 4.2 [Reserved]........................................................................ 15
Section 4.3 Action by Transferor with Respect to Bankruptcy................................... 15
Section 4.4 Restrictions on Transferor's Power................................................ 15
ARTICLE V
APPLICATION OF TRUST FUNDS; CERTAIN DUTIES
Section 5.1 Establishment of Trust Account.................................................... 16
Section 5.2 Application Of Trust Funds........................................................ 16
Section 5.3 Method of Payment................................................................. 16
Section 5.4 [Reserved]........................................................................ 16
Section 5.5 Accounting and Reports to the Transferor, the Internal Revenue Service and Others. 16
Section 5.6 Signature on Returns.............................................................. 17
ARTICLE VI
AUTHORITY AND DUTIES OF OWNER TRUSTEE
Section 6.1 General Authority................................................................. 18
Section 6.2 General Duties.................................................................... 18
Section 6.3 Action upon Instruction........................................................... 18
Section 6.4 No Duties Except as Specified in this Agreement, the Transaction Documents or in
Instructions...................................................................... 19
Section 6.5 No Action Except Under Specified Documents or Instructions........................ 20
Section 6.6 Restrictions...................................................................... 20
ARTICLE VII
CONCERNING THE OWNER TRUSTEE
Section 7.1 Acceptance of Trusts and Duties................................................... 21
Section 7.2 Furnishing of Documents........................................................... 22
Section 7.3 Representations and Warranties.................................................... 22
Section 7.4 Reliance; Advice of Counsel....................................................... 23
Section 7.5 Not Acting in Individual Capacity................................................. 23
Section 7.6 Owner Trustee Not Liable for the Ownership Interest or the Mortgage Loans......... 24
Section 7.7 Owner Trustee May Own the Ownership Interest and the Notes........................ 24
Section 7.8 Licenses.......................................................................... 24
ARTICLE VIII
COMPENSATION OF OWNER TRUSTEE
Section 8.1 Owner Trustee's Fees and Expenses................................................. 25
Section 8.2 Indemnification................................................................... 25
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Section 8.3 Payments to the Owner Trustee..................................................... 25
ARTICLE IX
TERMINATION OF TRUST AGREEMENT
Section 9.1 Termination of Trust Agreement.................................................... 26
ARTICLE X
SUCCESSOR OWNER TRUSTEES AND ADDITIONAL OWNER TRUSTEES
Section 10.1 Eligibility Requirements for Owner Trustee........................................ 28
Section 10.2 Resignation or Removal of Owner Trustee........................................... 28
Section 10.3 Successor Owner Trustee........................................................... 29
Section 10.4 Merger or Consolidation of Owner Trustee.......................................... 29
Section 10.5 Appointment of Co-Owner Trustee or Separate Owner Trustee......................... 29
ARTICLE XI
MISCELLANEOUS
Section 11.1 Supplements and Amendments........................................................ 32
Section 11.2 No Legal Title to Owner Trust Estate in Transferor................................ 33
Section 11.3 Limitations on Rights of Others................................................... 33
Section 11.4 Notices........................................................................... 33
Section 11.5 Severability...................................................................... 33
Section 11.6 Separate Counterparts............................................................. 34
Section 11.7 Successors and Assigns............................................................ 34
Section 11.8 No Petition....................................................................... 34
Section 11.9 [Reserved]........................................................................ 34
Section 11.10 No Recourse....................................................................... 34
Section 11.11 Headings.......................................................................... 34
Section 11.12 GOVERNING LAW..................................................................... 34
Section 11.13 Inconsistencies with Sale and Servicing Agreement................................. 35
Section 11.14 Third Party Beneficiary........................................................... 35
EXHIBIT A Certificate of Trust...................................................................... A-1
EXHIBIT B Form of Transfer Certificate.............................................................. B-1
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TRUST AGREEMENT, dated as of [ ], among [ ], Fleet Home Equity
Loan Corporation, as depositor (the "Depositor") and [the Owner Trustee], a
Delaware banking corporation, as owner trustee (the "Owner Trustee").
ARTICLE I
DEFINITIONS
Section 1.1 Capitalized Terms. For all purposes of this Agreement, the
following terms shall have the meanings set forth below:
"Agreement" shall mean this Trust Agreement, as the same may be amended
and supplemented from time to time.
"Bankruptcy Action" shall have the meaning assigned to such term in
Section 4.1.
"Benefit Plan" shall have the meaning assigned to such term in Section
3.13.
"Business Trust Statute" shall mean Chapter 38 of Title 12 of the
Delaware Code, 12 Del. Code Section 3801 et seq., as the same may be amended
from time to time.
"Certificate" shall mean the Ownership Interest.
"Certificate of Trust" shall mean the Certificate of Trust in the form
of Exhibit A to be filed for the Trust pursuant to Section 3810(a) of the
Business Trust Statute.
"Code" shall mean the Internal Revenue Code of 1986, as amended.
"Corporate Trust Office" shall mean, (i) with respect to the Owner
Trustee, the principal corporate trust office of the Owner Trustee, which office
at date of execution of this Agreement, is located at [___________], Attention:
Corporate Trust Administration; or at such other address in the State of
Delaware as the Owner Trustee may designate by notice to the Transferor and the
Trust, or the principal corporate trust office of any successor Owner Trustee
(the address (which shall be in the State of Delaware) of which the successor
owner trustee will notify the Transferor and the Trust); or (ii) with respect to
the Indenture Trustee, the principal corporate trust office of the Indenture
Trustee, which office at date of execution of this Agreement, is located at
[__________], Attention: Indenture Trust Administration, or at such other
address as the Indenture Trustee may designate by notice to the Transferor and
the Trust, or the principal corporate trust office of any successor Indenture
Trustee (the address (which shall be in the State of [ ]) of which the successor
indenture trustee will notify the Transferor and the Trust.
"Depositor" shall mean Fleet Home Equity Loan Corporation or its
successors.
"Distribution Account" shall have the meaning assigned to such term in
the Sale and Servicing Agreement.
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"Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended.
"Expenses" shall have the meaning assigned to such term in Section 8.2.
"Indenture" shall mean the Indenture, dated as of [____________], by
and between the Trust and the Indenture Trustee.
"Indenture Trustee" shall mean [____________], as Indenture Trustee
under the Indenture.
"Initial Note Principal Balance" shall mean with respect to the Class A
Notes, $[____________].
"Insurance Agreement" shall mean the Insurance and Reimbursement
Agreement dated as of [____________] among the Indenture Trustee, the Depositor,
the Seller, the Servicer and the Insurer, including any amendments and
supplements thereto.
"Non-permitted Foreign Owner" shall have the meaning set forth in
Exhibit B hereto.
"Non-U.S. Person" shall mean any Person other than (i) a citizen or
resident of the United States, (ii) an entity treated for United States federal
income tax purposes as a corporation or partnership created or organized in or
under the laws of the United States or any state thereof, including the District
of Columbia, (iii) an estate that is subject to U.S. federal income tax
regardless of the source of its income, (iv) a trust if a court within the
United States is able to exercise primary supervision over the administration of
the trust and one or more United States trustees have authority to control all
substantial decisions of the trust, or (v) certain trusts in existence on August
20, 1996 and treated as United States persons on such date that elect to
continue to be so treated.
"Owner Trust Estate" shall mean the contribution of $1 referred to in
Section 2.5 and the Trust Estate.
"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.
"Ownership Interest" shall have the meaning specified in Section 3.2.
"Prospective Transferor" shall mean any prospective purchaser or
prospective transferee of the Ownership Interest.
"Rating Agency Condition" shall mean, with respect to certain actions
requiring Rating Agency consent, that each Rating Agency shall have been given
10 days (or such shorter period as is acceptable to each Rating Agency) prior
notice thereof and that each of the Rating Agencies shall have notified the
Depositor, the Seller, the Owner Trustee, the Insurer and the Trust in writing
that such action will not result in a reduction or withdrawal of the then
current rating of the Notes, without regard to the Insurance Policy.
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"Record Date" shall mean the last Business Day preceding the related
Payment Date; provided, however, that following the date on which Definitive
Notes are available pursuant to Section 2.2 of the Indenture, the Record Date
shall be the last day of the calendar month preceding the month in which the
related Payment Date occurs.
"Register" shall mean a register kept by the Registrar in which,
subject to such reasonable regulations as it may prescribe, the Registrar shall
provide for the registration of the Certificate and the registration of
transfers of the Certificate. The location of the Registrar shall be the same as
that of the Corporate Trust Office of the Indenture Trustee.
"Registrar" shall mean the [indenture trustee] as Registrar hereunder.
"Sale and Servicing Agreement" shall mean the Sale and Servicing
Agreement dated as of the date hereof, among the Trust, the Depositor, the
Seller, the Indenture Trustee and the Servicer.
"Secretary of State" shall mean the Secretary of State of the State of
Delaware.
"Seller" shall mean [____________] or its successors.
"Servicer" shall mean [____________], or any successor servicer
appointed pursuant to the Sale and Servicing Agreement.
"Transaction Documents" shall mean each of the Indenture, the Sale and
Servicing Agreement, the Insurance Agreement and this Agreement.
"Transferor" shall mean the owner of the Ownership Interest.
"Transferor Interest" shall have the meaning specified in Section 3.2.
"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 [ ] Home Equity Loan Trust 200_-_, the Delaware
business trust created pursuant to this Agreement.
"Trust Estate" shall mean the assets subject to the Sale and Servicing
Agreement, the Mortgage Loan Purchase Agreement, this Trust Agreement and the
Indenture, assigned to the Indenture Trustee, which assets consist of: (i) each
Mortgage Loan and the related Mortgage File, including its Principal Balance and
all collections in respect thereof received after the Cut-Off Date; (ii)
property that secured a Mortgage Loan that is acquired by foreclosure or deed in
lieu of foreclosure; (iii) the Seller's rights under any insurance policies
relating to the Mortgage Loans (including any Insurance Proceeds); (iv) amounts
on deposit in the Collection Account
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and Distribution Account; (v) the Depositor's rights under the Purchase
Agreement and (vi) any proceeds of any of the foregoing and (vii) all other
assets included or to be included in the Trust for the benefit of Noteholders
and the Insurer. In addition, on or prior to the Closing Date, the Seller shall
cause the Insurer to deliver the Insurance Policy to the Indenture Trustee for
the benefit of the Noteholders.
"Underwriter" shall mean [____________].
Section 1.2 Other Definitional Provisions.
(a) Capitalized terms used herein 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.
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ARTICLE II
ORGANIZATION
Section 2.1 Name. The Trust created hereby shall be known as "[ ] Home
Equity Loan Trust 200_-_," in which name the Owner Trustee may conduct the
business of the Trust and make and execute contracts and other instruments on
behalf of the Trust and the Trust may ▇▇▇ and be sued.
Section 2.2 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 the
State of Delaware as the Owner Trustee may designate by written notice to the
Transferor.
Section 2.3 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
Ownership Interest pursuant to this Agreement and to sell such Notes
and Ownership Interest;
(ii) with the proceeds of the sale of the Notes and the
Ownership Interest, to fund start-up and transactional expenses of the
Trust and to pay the balance to the Depositor, or at the direction of
the Depositor, to pay the Seller, as its interests may appear pursuant
to the Sale and Servicing Agreement;
(iii) to assign, grant, transfer, pledge, mortgage and convey
the Trust Estate pursuant to the Indenture and to hold, manage and
distribute to the Transferor 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
Transaction 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 Transaction 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 Noteholders and the Transferor.
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
Transaction Documents.
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Section 2.4 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 2.5 Initial Capital Contribution of Owner Trust Estate. The
Depositor hereby sells, assigns, transfers, conveys and sets over to the Trust,
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 Distribution Account. The Depositor shall pay organizational
expenses of the Trust as they may arise or shall, upon the request of the Owner
Trustee, promptly reimburse the Owner Trustee for any such expenses paid by the
Owner Trustee.
Section 2.6 Declaration of Trust. The Owner Trustee hereby declares
that it will hold the Owner Trust Estate in trust upon and subject to the
conditions set forth herein for the use and benefit of the Transferor, subject
to the obligations of the Trust under the Transaction 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 security arrangement, with the assets of the Trust being the Trust Estate
and the Transferor being the owner of the Ownership Interest. 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, if any, consistent with the characterization of the Trust as provided in
the preceding sentence for such tax purposes. Effective as of the date hereof,
the Owner Trustee shall have all rights, powers and duties set forth herein and
in the Business Trust Statute with respect to accomplishing the purposes of the
Trust. The Owner Trustee has filed the Certificate of Trust with the Secretary
of State of the State of Delaware.
Section 2.7 Title to Trust Property.
(a) Subject to the Indenture, legal title to all the Owner
Trust Estate shall be vested at all times in the Trust as a separate legal
entity except where applicable law in any jurisdiction requires title to any
part of the Owner Trust Estate to be vested in a trustee or trustees, in which
case title shall be deemed to be vested in the Owner Trustee, a co-owner trustee
and/or a separate trustee, as the case may be.
(b) The Transferor shall not have legal title to any part of
the Owner Trust Estate. No transfer by operation of law or otherwise of any
interest of the Transferor shall operate to terminate this Agreement or the
trusts hereunder or entitle any transferee to an accounting or to the transfer
to it of any part of the Owner Trust Estate.
Section 2.8 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
[____________]. The Trust shall not have any employees; provided, however, that
nothing herein shall restrict or prohibit the Owner Trustee
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from having employees within or without the State of Delaware. Payments will be
received by the Trust only in Delaware or [____________], and payments will be
made by the Trust only from Delaware or [____________]. The only office of the
Trust will be at the Corporate Trust Office in Delaware.
Section 2.9 Representations and Warranties of the Depositor.
The Depositor hereby represents and warrants to the Owner Trustee and
the Insurer that:
(a) The Depositor is a [____________]. The Depositor has the
power and authority to execute and deliver this Agreement and to perform in
accordance herewith; the execution, delivery and performance of this Agreement
(including all instruments of transfer to be delivered pursuant to this
Agreement) by the Depositor and the consummation of the transactions
contemplated hereby have been duly and validly authorized by all necessary
action of the Depositor; this Agreement evidences the valid, binding and
enforceable obligation of the Depositor; and all requisite action has been taken
by the Depositor to make this Agreement valid, binding and enforceable upon the
Depositor in accordance with its terms, subject to the effect of bankruptcy,
insolvency, reorganization, moratorium and other similar laws relating to or
affecting creditors' rights generally or the application of equitable principles
in any proceeding, whether at law or in equity.
(b) The consummation of the transactions contemplated by this
Agreement will not result in (i) the breach of any terms or provisions of the
Articles of Incorporation or Bylaws of the Depositor, (ii) the breach of any
term or provision of, or conflict with or constitute a default under or result
in the acceleration of any obligation under, any material agreement, indenture
or loan or credit agreement or other material instrument to which the Depositor,
or its property is subject, or (iii) the violation of any law, rule, regulation,
order, judgment or decree to which the Depositor or its respective property is
subject.
(c) The Depositor is not in default with respect to any order
or decree of any court or any order, regulation or demand of any federal, state,
municipal or other governmental agency, which default might have consequences
that would materially and adversely affect the condition (financial or
otherwise) or operations of the Depositor or its properties or might have
consequences that would materially and adversely affect its performance
hereunder.
(d) To the Depositor's best knowledge, there are no
proceedings or investigations pending or threatened before any court, regulatory
body, administrative agency or other governmental instrumentality having
jurisdiction over the Depositor or its properties: (A) asserting the invalidity
of this Agreement, (B) seeking to prevent the consummation of any of the
transactions contemplated by this Agreement or (C) seeking any determination or
ruling that might materially and adversely affect the performance by the
Depositor of its obligations under, or the validity or enforceability of, this
Agreement.
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Section 2.10 Federal Income Tax Allocations. Net income of the Trust
for any month, as determined for Federal income tax purposes (and each item of
income, gain, loss and deduction entering into the computation thereof), shall
be allocated to the Transferor.
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ARTICLE III
OWNERSHIP INTEREST AND TRANSFERS OF THE OWNERSHIP INTEREST
Section 3.1 Initial Ownership. Upon the formation of the Trust by the
contribution by the Depositor pursuant to Section 2.5, the Transferor shall be
the sole owner of the Trust.
Section 3.2 The Ownership Interest. The Ownership Interest (as defined
below) shall be uncertificated and shall represent the entire beneficial
ownership interest in the assets of the Trust Estate, subject to the debt
represented by the Notes (the "Ownership Interest" or "Transferor Interest").
The Ownership Interest may be assigned by the Transferor as provided in Section
3.13.
A transferee of the Ownership Interest shall become the Transferor, and
shall be entitled to the rights and subject to the obligations of the Transferor
hereunder, upon such transferee's acceptance of the Ownership Interest duly
registered in such transferee's name pursuant to Section 3.4 below.
Section 3.3 [Reserved].
Section 3.4 Registration of Transfer and Exchange of Ownership
Interest. The Owner Trustee hereby appoints [____________] as Registrar under
this Agreement. The Registrar shall keep or cause to be kept, at the office or
agency maintained pursuant to Section 3.8, a Register in which, subject to such
reasonable regulations as it may prescribe, the Register shall provide for the
registration of the Ownership Interest and of transfer and exchange of the
Ownership Interest as herein provided. The Registrar, subject to Section 3.13
hereof, on behalf of the Trust shall note on the Register the transfer of the
Ownership Interest.
Section 3.5 [Reserved].
Section 3.6 Persons Deemed Transferors. Prior to due assignment of the
Ownership Interest for registration of transfer, the Depositor, the Seller, the
Owner Trustee, the Indenture Trustee, the Insurer and the Registrar may treat
the Person in whose name the Ownership Interest shall be registered in the
Register as the owner thereof for the purpose of receiving distributions
pursuant to Section 5.2 hereof and for all other purposes whatsoever, and none
of the Depositor, the Seller, the Owner Trustee, the Indenture Trustee, the
Insurer or the Registrar shall be bound by any notice to the contrary.
Section 3.7 [Reserved]
Section 3.8 Maintenance of Office or Agency. The Indenture Trustee
shall maintain an office or offices or agency or agencies (initially, the
Corporate Trust Office of the Indenture Trustee) where instructions for the
transfer of the Ownership Interest may be delivered for registration of transfer
[or exchange] pursuant to Section 3.4 and where notices and demands to or upon
the Registrar in respect of the Ownership Interest and the Transaction Documents
may
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be served. The Indenture Trustee shall give prompt written notice to the Seller,
the Insurer, the Owner Trustee and the Transferor of any change in the location
of the Register or any such office or agency.
Section 3.9 Appointment of Paying Agent. The Owner Trustee hereby
appoints the Indenture Trustee as Paying Agent under this Agreement. The Paying
Agent shall make distributions to the Transferor from the Distribution Account
pursuant to Section 5.2 hereof and Section 5.01 of the Sale and Servicing
Agreement and shall report the amounts of such distributions to the Owner
Trustee. The Paying Agent shall have the revocable power to withdraw funds from
the Distribution Account for the purpose of making the distributions referred to
above. In the event that the Indenture Trustee shall no longer be the Paying
Agent hereunder, the Owner Trustee shall appoint a successor to act as Paying
Agent (which shall at all times be a corporation duly incorporated and validly
existing under the laws of the United States of America or any state thereof,
authorized under such laws to exercise corporate trust powers and subject to
supervision or examination by federal or state authorities). 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 Transferor in trust for the benefit of the Transferor until such sums shall
be paid to the Transferor. 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. Any reference in
this Agreement to the Paying Agent shall include any co-paying agent unless the
context requires otherwise.
Section 3.10 [Reserved].
Section 3.11 [Reserved].
Section 3.12 [Reserved].
Section 3.13 Restrictions on Transfers of Ownership Interest. The
Ownership Interest shall not be sold, pledged, transferred or assigned, except
as provided below.
(a) The Ownership Interest may not be acquired by or for the
account of (i) an employee benefit plan (as defined in Section 3(3) of the
Employee Retirement Income Security Act of 1974, as amended ("ERISA")) 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, including an insurance company
separate account or general account, whose underlying assets include plan assets
by reason of a plan's investment in the entity (each, a "Benefit Plan"). Each
Prospective owner of the Ownership Interest, other than the Seller or an
affiliate of the Seller, shall represent and warrant, in writing, to the Owner
Trustee and the Registrar and any of their respective successors that:
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(i) Such Person is (A) a "qualified institutional buyer" as
defined in Rule 144A under the Securities Act of 1933, as amended (the
"Securities Act"), and is aware that the seller of such Ownership
Interest may be relying on the exemption from the registration
requirements of the Securities Act provided by Rule 144A and is
acquiring such Ownership Interest for its own account or for the
account of one or more qualified institutional buyers for whom it is
authorized to act, (B) an "accredited investor" as defined in Rule
501(a) under the Securities Act , or (C) a Person involved in the
organization or operation of the Trust or an affiliate of such Person
within the meaning of Rule 3a-7 of the 1940 Act, as amended (including,
but not limited to, the Seller or the Transferor).
(ii) Such Person understands that such Ownership Interest has
not been and will not be registered under the Securities Act and may be
offered, sold, pledged or otherwise transferred only to a person whom
the seller reasonably believes is (A) a "qualified institutional
buyer," (B) "an accredited investor" or (C) a Person involved in the
organization or operation of the Trust or an affiliate of such Person,
in each case in a transaction meeting the requirements of Rule 144A
under the Securities Act or that is otherwise exempt from registration
under the Securities Act and in accordance with any applicable
securities laws of any state of the United States.
(iii) Such Person shall comply with the provisions of Section
3.13(b), as applicable, relating to the ERISA restrictions with respect
to the acceptance or acquisition of such Ownership Interest .
(b) Each Prospective Transferor, other than the Transferor or
an affiliate of the Transferor, shall either:
(i) represent and warrant, in writing, to the Owner Trustee
and the Registrar and any of their respective successors, in accordance
with Exhibit B hereto, that the Prospective Transferor is not (A) an
"employee benefit plan" within the meaning of Section 3(3) of the
Employee Retirement Income Security Act of 1974, as amended ("ERISA"),
or (B) a "plan" within the meaning of Section 4975(e)(1) of the Code
(any such plan or employee benefit plan, a "Plan") or (C) any entity,
including an insurance company separate account or general account,
whose underlying assets include plan assets by reason of a plan's
investment in the entity and is not directly or indirectly purchasing
such Ownership Interest on behalf of, as investment manager of, as
named fiduciary of, as trustee of, or with assets of a Plan; or
(ii) furnish to the Owner Trustee and the Registrar and any of
their respective successors an opinion of counsel acceptable to such
persons that (A) the proposed issuance or transfer of such Ownership
Interest to such Prospective Transferor will not cause any assets of
the Trust to be deemed assets of a Plan, and (B) the proposed holding
or transfer of such Ownership Interest will not cause the Owner Trustee
or the Registrar or any of their respective successors to be a
fiduciary of a Plan within the meaning of
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Section 3(21) of ERISA and will not give rise to a transaction
described in Section 406 of ERISA or Section 4975(c)(1) of the Code for
which a statutory or administrative exemption is unavailable.
(c) [Reserved].
(d) The Prospective Transferor, other than the Transferor or
an affiliate of the Transferor, shall obtain an Opinion of Counsel to the effect
that, as a matter of federal income tax law, such Prospective Transferor is
permitted to accept the transfer of the Ownership Interest.
(e) The Ownership Interest may not be pledged or transferred
without delivery to the Registrar of an Opinion of Counsel to the effect that
such transfer would not jeopardize the tax treatment of the Trust, would not
subject the Trust to an entity-level tax, and would not jeopardize the status of
the Notes as debt for all purposes.
(f) No pledge or transfer of the Ownership Interest shall be
effective unless such purchase or transfer is (i) to a single beneficial owner
and (ii) accompanied by an opinion of counsel satisfactory to the Owner Trustee,
which Opinion of Counsel shall not be an expense of the Trust, the Registrar,
the Servicer or the Seller, to the effect such pledge or transfer will not cause
the Trust to be treated for federal income tax purposes as a taxable mortgage
pool, association or a publicly traded partnership taxable as a corporation.
(g) Transfer of the Ownership Interest shall be made only if
accompanied by an opinion of counsel satisfactory to the Owner Trustee, which
opinion of counsel shall not be an expense of the Trust, the Owner Trustee, the
Servicer or the Seller, to the effect such transfer will not cause the Trust to
be treated for federal income tax purposes as an association, a taxable mortgage
pool or a publicly traded partnership taxable as a corporation.
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ARTICLE IV
ACTIONS BY OWNER TRUSTEE
Section 4.1 Prior Notice to the Transferor and the Insurer with Respect
to Certain Matters. With respect to the following matters, the Owner Trustee
shall not take action, and neither the Transferor nor the Insurer shall direct
the Owner Trustee to take any action, unless (i) the Insurer has provided its
written consent and (ii) at least 30 days before the taking of such action, the
Owner Trustee shall have notified the Transferor in writing of the proposed
action and neither the Transferor nor the Insurer shall have notified the Owner
Trustee in writing prior to the 30th day after such notice is given that the
Transferor has withheld consent or the Transferor or the Insurer have 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
Mortgage Loans) and the compromise of any action, claim or lawsuit brought by or
against the Trust (except with respect to the aforementioned claims or lawsuits
for collection of the Mortgage Loans);
(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 or other change to this Agreement or any
Transaction Document in circumstances where the consent of any Noteholder or the
Insurer is required;
(d) the amendment or other change to this Agreement or any
Transaction Document in circumstances where the consent of any Noteholder or the
Insurer is not required and such amendment materially adversely affects the
interest of the Transferor;
(e) the appointment pursuant to the Indenture of a successor
Note Registrar, Paying Agent or Indenture Trustee, or the consent to the
assignment by the Note Registrar, Paying Agent or Indenture Trustee of its
obligations under the Indenture;
(f) the consent to the calling or waiver of any default of any
Transaction Document;
(g) the consent to the assignment by the Indenture Trustee or
the Seller of their respective obligations under any Transaction Document;
(h) except as provided in Article IX hereof, dissolve,
terminate or liquidate the Trust in whole or in part;
(i) merge or consolidate the Trust with or into any other
entity, or, except as contemplated by the Sale and Servicing Agreement, convey
or transfer all or substantially all of the Trust's assets to any other entity;
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(j) cause the Trust to incur, assume or guaranty any
indebtedness other than the Notes, as set forth in this Agreement;
(k) do any act that conflicts with any other Transaction
Document;
(l) do any act which would make it impossible to carry on the
ordinary business of the Trust;
(m) confess a judgment against the Trust;
(n) possess Trust assets, or assign the Trust's right to
property, for other than a Trust purpose; or
(o) change the Trust's purpose and powers from those set forth
in this Agreement.
In addition, except as specifically contemplated by the Transaction
Documents, the Trust shall not commingle its assets with those of any other
entity. The Trust shall maintain its financial and accounting books and records
separate from those of any other entity. Except as expressly set forth herein,
the Trust shall pay its indebtedness, operating expenses from its own funds, and
the Trust shall not pay the indebtedness, operating expenses and liabilities of
any other Person. The Trust shall maintain appropriate minutes or other records
of all appropriate actions and shall maintain its office separate from the
offices of the Depositor or the Seller, and any of their respective affiliates.
This Agreement and the Transaction Documents shall be the only agreements among
the parties hereto with respect to the creation, operation and termination of
the Trust. For accounting purposes, the Trust shall be treated as an entity
separate and distinct from the Transferor. The pricing and other material terms
of all transactions and agreements to which the Trust is a party shall be
intrinsically fair to all parties thereto.
The Owner Trustee shall not have the power, except upon the direction
of the Transferor and with the consent of the Insurer (which consent shall not
be unreasonably withheld), and to the extent otherwise consistent with the
Transaction Documents, to (i) remove or replace the Seller or the Indenture
Trustee, (ii) institute proceedings to have the Trust declared or adjudicated a
bankrupt or insolvent, (iii) consent to the institution of bankruptcy or
insolvency proceedings against the Trust, (iv) file a petition or consent to a
petition seeking reorganization or relief on behalf of the Trust under any
applicable federal or state law relating to bankruptcy, (v) consent to the
appointment of a receiver, liquidator, assignee, trustee, sequestrator (or any
similar official) of the Trust or a substantial portion of the property of the
Trust, (vi) make any assignment for the benefit of the Trust's creditors, (vii)
cause the Trust to admit in writing its inability to pay its debts generally as
they become due, or (viii) take any action, or cause the Trust to take any
action, in furtherance of any of the foregoing (any of the above, a "Bankruptcy
Action"). So long as the Indenture remains in effect, the Transferor shall not
have the power to take, and shall not take, any Bankruptcy Action with respect
to the Trust or direct the Owner Trustee to take any Bankruptcy Action with
respect to the Trust.
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Section 4.2 [Reserved].
Section 4.3 Action by Transferor 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 prior consent and approval of (i)
the Insurer; (ii) the Transferor; (iii) the Owner Trustee; and (iv) the
Indenture Trustee, and the delivery to the Owner Trustee by the Transferor of a
certificate certifying that such Transferor reasonably believes that the Trust
is insolvent. The terms of this Section 4.3 shall survive for one year and one
day following the termination of this Agreement.
Section 4.4 Restrictions on Transferor's Power. The Transferor shall not direct
the Owner Trustee to take or refrain from taking any action if such action or
inaction would be contrary to any obligation of the Trust or the Owner Trustee
under this Agreement or any of the Transaction Documents or would be contrary to
Section 2.3 hereof, nor shall the Owner Trustee be obligated to follow any such
direction, if given.
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ARTICLE V
APPLICATION OF TRUST FUNDS; CERTAIN DUTIES
Section 5.1 Establishment of Trust Account. The Owner Trustee shall
cause the Indenture Trustee to establish and maintain with the Indenture Trustee
for the benefit of the Owner Trustee one or more Eligible Accounts in accordance
with the Indenture.
Section 5.2 Application Of Trust Funds.
(a) On each Payment Date, the Paying Agent shall make the
distributions and payments set forth in Section 5.01 of the Sale and Servicing
Agreement from amounts on deposit in the Distribution Account.
(b) On or before the third Business Day following each Payment
Date, the Paying Agent shall send to DTC the statement provided to the Paying
Agent by the Indenture Trustee pursuant to Section 5.03 of the Sale and
Servicing Agreement with respect to such Payment Date.
(c) In the event that any withholding tax is imposed on the
Trust's payment (or allocations of income) to the Transferor, such tax shall
reduce the amount otherwise distributable to the Transferor in accordance with
this Section 5.2. The Paying Agent is hereby authorized and directed to retain
from amounts otherwise distributable to the Transferor sufficient funds for the
payment of any tax that is legally owed by the Trust (but such authorization
shall not prevent the Paying Agent from contesting any such tax in appropriate
proceedings, and withholding payment of such tax, if permitted by law, pending
the outcome of such proceedings). The amount of any withholding tax imposed with
respect to the Transferor shall be treated as cash distributed to the Transferor
at the time it is withheld by the Trust and remitted to the appropriate taxing
authority. If there is a possibility that withholding tax is payable with
respect to a distribution (such as a distribution to a non-U.S. Transferor), the
Paying Agent may in its sole discretion withhold such amounts in accordance with
this paragraph (c). In the event that the Transferor wishes to apply for a
refund of any such withholding tax, the Owner Trustee and the Paying Agent shall
reasonably cooperate with the Transferor in making such claim so long as the
Transferor agrees to reimburse the Owner Trustee and the Paying Agent for any
out-of-pocket expenses incurred.
Section 5.3 Method of Payment. Distributions required to be made to the
Transferor on any Payment Date shall be made to the Transferor of record on the
preceding Record Date in the manner set forth in Section 5.01 of the Sale and
Servicing Agreement.
Section 5.4 [Reserved].
Section 5.5 Accounting and Reports to the Transferor, the Internal
Revenue Service and Others. The Owner Trustee shall deliver to the Transferor
such information, reports or statements as may be required by the Code and
applicable Treasury Regulations and as may be
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required to enable the Transferor to prepare its respective federal and state
income tax returns. Consistent with the Trust's characterization for tax
purposes as a security arrangement for the issuance of non-recourse debt, no
federal income tax return shall be filed on behalf of the Trust unless either
(a) the Trust or the Transferor shall receive an Opinion of Counsel based on a
change in applicable law occurring after the date hereof that the Code requires
such a filing or (b) the Internal Revenue Service shall determine that the Trust
is required to file such a return. In the event that the Trust is required to
file tax returns, 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 Mortgage Loans. The Owner Trustee shall prepare or shall cause to be
prepared any tax returns required to be filed by the Trust and shall remit such
returns to the Transferor at least five days before such returns are due to be
filed. The Transferor, or any other such party required by law, shall promptly
sign such returns and deliver such returns after signature to the Owner Trustee
and such returns shall be filed by, or at the direction of, the Owner Trustee
with the appropriate tax authorities. In no event shall the Transferor be liable
for any liabilities, costs or expenses of the Trust arising out of the
application of any tax law, including federal, state, foreign or local income or
excise taxes or any other tax imposed on or measured by income (or any interest,
penalty or addition with respect thereto or arising from a failure to comply
therewith), except for any such liability, cost or expense attributable to the
Transferor's breach of its obligations under this Agreement.
Section 5.6 Signature on Returns.
The Owner Trustee shall sign on behalf of the Trust the tax returns of
the Trust, if any, unless applicable law requires a Transferor to sign such
documents, in which case such documents shall be signed by the Transferor.
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ARTICLE VI
AUTHORITY AND DUTIES OF OWNER TRUSTEE
Section 6.1 General Authority. The Owner Trustee is authorized and
directed to execute and deliver or cause to be executed and delivered the Notes,
and the Transaction 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
Transaction Documents to which the Trust is to be a party and any amendment or
other agreement or instrument described in Article III, in each case, in such
form as the Owner Trustee shall approve, as evidenced conclusively by the Owner
Trustee's execution thereof, and, on behalf of the Trust, to direct the
Indenture Trustee to authenticate and deliver the Class A Notes in an aggregate
principal amount equal to $[ ]. 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 Transaction Documents.
Section 6.2 General Duties. It shall be the duty of the Owner Trustee
to discharge (or cause to be discharged) all of its responsibilities pursuant to
the terms of this Agreement and the Transaction Documents to which the Trust is
a party and to administer the Trust in the interest of the Transferor, subject
to the Transaction 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
Transaction 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 Transaction Document, and the Owner Trustee
shall not be held liable for the default or failure of the Administrator to
carry out their respective obligations under the Administration Agreement.
Section 6.3 Action upon Instruction.
(a) Subject to Article IV herein and in accordance with the
terms of the Transaction Documents, the Transferor may by written instruction
direct the Owner Trustee in the management of the Trust but only to the extent
consistent with the limited purpose of the Trust. Such direction may be
exercised at any time by written instruction of the Transferor pursuant to
Article IV.
(b) Notwithstanding the foregoing, the Owner Trustee shall not
be required to take any action hereunder or under any Transaction 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 Transaction 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 Transaction Document, the Owner Trustee shall promptly
give notice (in such form as shall be appropriate under the circumstances) to
the Transferor and the Insurer (so long as no Insurer Default exists) requesting
instruction from the Transferor and the Insurer (so long as no Insurer Default
exists)
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as to the course of action to be adopted, and to the extent the Owner Trustee
acts in good faith in accordance with any written instruction of the Transferor
or the Insurer 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 Transaction
Documents, as it shall deem to be in the best interest of the Transferor, 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 Transaction 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 provides no direction to 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 Transferor and
the Insurer requesting instruction and, to the extent that the Owner Trustee
acts or refrains from acting in good faith in accordance with any such
instruction received from the Insurer, or if there is an Insurer Default, the
Transferor, 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 Transaction
Documents, as it shall deem to be in the best interest of the Transferor, and
shall have no liability to any Person for such action or inaction.
Section 6.4 No Duties Except as Specified in this Agreement, the
Transaction Documents 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 or the Trust is a
party, except as expressly provided by the terms of this Agreement, any
Transaction Document or in any document or written instruction received by the
Owner Trustee pursuant to Section 6.3; and no implied duties or obligations
shall be read into this Agreement or any Transaction Document against the Owner
Trustee. The Owner Trustee shall have no responsibility for filing any financing
or continuation statement in any public office at anytime 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 Transaction 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.
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Section 6.5 No Action Except Under Specified Documents or Instructions.
The Owner Trustee shall not manage, control, use, sell, dispose of or otherwise
deal with any part of the Owner Trust Estate except (i) in accordance with the
powers granted to and the authority conferred upon the Owner Trustee pursuant to
this Agreement, (ii) in accordance with the Transaction Documents and (iii) in
accordance with any document or instruction delivered to the Owner Trustee
pursuant to Section 6.3 above.
Section 6.6 Restrictions. The Owner Trustee shall not take any action
(a) that is inconsistent with the purposes of the Trust set forth in Section 2.3
hereof 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 Transferor shall not direct the Owner Trustee to take action that
would violate the provisions of this Section 6.6.
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ARTICLE VII
CONCERNING THE OWNER TRUSTEE
Section 7.1 Acceptance of Trusts and Duties. The Owner Trustee accepts
the trusts hereby created and agrees to perform its duties hereunder with
respect to such trusts but only upon the terms of this Agreement and the
Transaction Documents. 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 Transaction Documents and this Agreement. The Owner Trustee shall
not be answerable or accountable hereunder or under any Transaction Document
under any circumstances, except (i) for its own willful misconduct, bad faith or
negligence or (ii) in the case of the inaccuracy of any representation or
warranty contained in Section 7.3 below expressly made by the Owner Trustee. In
particular, but not by way of limitation (and subject to the exceptions set
forth in the preceding sentence):
(a) the Owner Trustee shall not be liable for any error of
judgment made by a responsible officer of the Owner Trustee;
(b) the execution, delivery, authentication and performance by
the Owner Trustee of this Agreement will not require the authorization, consent
or approval of, the giving of notice to, the filing or registration with, or the
taking of any other action with respect to, any governmental authority or
agency;
(c) no provision of this Agreement or any Transaction 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 Transaction 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 Transaction Documents,
including the principal of and interest on the Notes;
(e) the Owner Trustee shall not be responsible for or in
respect of the validity or sufficiency of this Agreement or for the due
execution hereof by the Depositor or the Seller 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 Transaction Documents,
other than the certificate of authentication on the Ownership Interest, and the
Owner Trustee shall in no event assume or incur any liability, duty, or
obligation to any Noteholder, to the Transferor or other than as expressly
provided for herein and in the Transaction Documents;
(f) the Owner Trustee shall not be liable for the default or
misconduct of the Seller, the Indenture Trustee, or the Servicer under any of
the Transaction 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 Transaction Documents that are required to be
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performed by the Indenture Trustee under the Indenture, the Servicer under the
Sale and Servicing Agreement, the Administrator or [ ] under the Administration
Agreement or the Registrar or any Paying Agent hereunder;
(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 Transaction Document, at the request, order or
direction of the Transferor, unless such Transferor has 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 Transaction Document shall not be construed as a duty, and
the Owner Trustee shall not be answerable for other than its gross negligence or
willful misconduct in the performance of any such act; and
(h) 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 Insurer, the Depositor or any Owner to the extent such action or direction
is permitted by the Transaction Documents.
Section 7.2 Furnishing of Documents. The Owner Trustee shall furnish
(a) to the Transferor 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 Transaction Documents and (b) to Noteholders and the Insurer promptly
upon written request therefor, copies of the Sale and Servicing Agreement and
this Agreement.
Section 7.3 Representations and Warranties.
[Owner Trustee] hereby represents and warrants to the Depositor, for
the benefit of the Transferor and the Insurer, that:
(a) It is a banking corporation duly organized and validly
existing in good standing under the laws of the State of Delaware. It has all
requisite corporate power and authority to execute, deliver and perform its
obligations under this Agreement;
(b) It has taken all corporate action necessary to authorize
the execution and delivery by it of this Agreement, and this Agreement will be
executed and delivered by one of its officers who is duly authorized to execute
and deliver this Agreement on its behalf;
(c) Neither the execution nor the delivery by it of this
Agreement nor the consummation by it of the transactions contemplated hereby nor
compliance by it with any of the terms or provisions hereof will contravene any
Federal or Delaware law, governmental rule or regulation governing the banking
or trust powers of the Owner Trustee or any judgment or order binding on it, or
constitute any default under its charter documents or by-laws or any indenture,
mortgage, contract, agreement or instrument to which it is a party or by which
any of its properties may be bound;
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(d) This Agreement has been duly authorized, executed and
delivered by the Owner Trustee and constitutes a valid, legal and binding
obligation of the Owner Trustee, enforceable against it in accordance with the
terms hereof, subject to applicable bankruptcy, insolvency, reorganization,
moratorium and other laws affecting the enforcement of creditors' rights
generally and to general principles of equity, regardless of whether such
enforcement is considered in a proceeding in equity or at law;
(e) The Owner Trustee is not in default with respect to any
order or decree of any court or any order, regulation or demand of any federal,
state, municipal or governmental agency, which default might have consequences
that would materially and adversely affect the condition (financial or other) or
operations of the Owner Trustee or its properties or might have consequences
that would materially adversely affect its performance hereunder; and
(f) No litigation is pending or, to the best of the Owner
Trustee's knowledge, threatened against the Owner Trustee which would prohibit
its entering into this Agreement or performing its obligations under this
Agreement.
Section 7.4 Reliance; Advice of Counsel.
(a) The Owner Trustee shall incur no liability to anyone in
acting upon any signature, instrument, notice, resolution, request, consent,
order, certificate, report, opinion, bond, or other document or paper believed
by it to be genuine and believed by it to be signed by the proper party or
parties. The Owner Trustee may accept a certified copy of a resolution of the
board of directors or other governing body of any corporate party as conclusive
evidence that such resolution has been duly adopted by such body and that the
same is in full force and effect. As to any fact or matter the method of the
determination of which is not specifically prescribed herein, the Owner Trustee
may for all purposes hereof rely on a certificate, signed by the president or
any vice president or by the treasurer or other authorized officer 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
Transaction 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 opinion or advice
of any such counsel, accountants or other such persons and not contrary to this
Agreement or any Transaction Document.
Section 7.5 Not Acting in Individual Capacity. Except as provided in
this Article VII, in accepting the trusts hereby created, [Owner Trustee] acts
solely as Owner Trustee hereunder and not in its individual capacity and all
Persons having any claim against the Owner Trustee by
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reason of the transactions contemplated by this Agreement or any Transaction
Document shall look only to the Owner Trust Estate for payment or satisfaction
thereof.
Section 7.6 Owner Trustee Not Liable for the Ownership Interest or the
Mortgage Loans. The recitals contained herein and in the Ownership Interest
(other than the signature of the Owner Trustee on the Certificate) shall be
taken as the statements of the Seller, and the Owner Trustee assumes no
responsibility for the correctness thereof. The Owner Trustee makes no
representations as to the validity or sufficiency of this Agreement, of any
Transaction Document or of the Ownership Interest (other than the signature of
the Owner Trustee on the Certificate and as specified in Section 7.3 hereof) or
the Notes, or of any Mortgage Loans 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 Mortgage Loan, or the perfection
and priority of any security interest created by any Mortgage Loan 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 the Transferor under this Agreement or to the Noteholders
under the Indenture, including, without limitation: the existence, condition and
ownership of any Mortgaged Property; the existence and enforceability of any
insurance thereon; the existence and contents of any Mortgage Loan on any
computer or other record thereof; the validity of the assignment of any Mortgage
Loan to the Trust or of any intervening assignment; the completeness of any
Mortgage Loan; the performance or enforcement of any Mortgage Loan; the
compliance by the Depositor, the Seller or the Servicer with any warranty or
representation made under any Transaction Document or in any related document or
the accuracy of any such warranty or representation or any action of the
Depositor, the Seller, the Indenture Trustee, the Administrator or the Servicer
or any subservicer taken in the name of the Owner Trustee.
Section 7.7 Owner Trustee May Own the Ownership Interest and the Notes.
The Owner Trustee in its individual or any other capacity may become the owner
or pledgee of the Ownership Interest or the Notes and may deal with the
Depositor, the Seller, the Indenture Trustee, the Administrator and the Servicer
in banking transactions with the same rights as it would have if it were not
Owner Trustee.
Section 7.8 Licenses. The Owner Trustee shall cause the Trust to use
its best efforts to obtain and maintain the effectiveness of any licenses
required in connection with this Agreement and the Transaction Documents and the
transactions contemplated hereby and thereby until such time as the Trust shall
terminate in accordance with the terms hereof.
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ARTICLE VIII
COMPENSATION OF OWNER TRUSTEE
Section 8.1 Owner Trustee's Fees and Expenses. The Owner Trustee shall
receive as compensation for its services hereunder such fees as have been
separately agreed upon before the date hereof between the Seller and the Owner
Trustee, and the Owner Trustee shall be entitled to be reimbursed by [ ] 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 8.2 Indemnification. [_______] 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 Transaction 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 [_______] 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 7.1 hereof. The indemnities contained in this Section 8.2 shall survive
the resignation or termination of the Owner Trustee or the termination of this
Agreement. In the event of any claim, action or proceeding for which indemnity
will be sought pursuant to this Section 8.2, the Owner Trustee's choice of legal
counsel shall be subject to the approval of the Seller, which approval shall not
be unreasonably withheld.
Section 8.3 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.
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ARTICLE IX
TERMINATION OF TRUST AGREEMENT
Section 9.1 Termination of Trust Agreement.
(a) This Agreement (other than Article VIII) and the Trust
shall terminate pursuant to the Business Trust Statute and be of no further
force or effect on the earlier of (i) the satisfaction and discharge of the
Indenture pursuant to Section 4.1 of the Indenture and the termination of the
Sale and Servicing Agreement and (ii) the expiration of 21 years from the death
of the last survivor of the descendants of ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ (the late
ambassador of the United States to the Court of St. James's) alive on the date
hereof. The bankruptcy, liquidation, dissolution, death or incapacity of the
Transferor shall not (x) operate to terminate this Agreement or the Trust, nor
(y) entitle such Transferor'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 nor (z)
otherwise affect the rights, obligations and liabilities of the parties hereto.
(b) The Ownership Interest shall be subject to an early
redemption or termination at the option of the Servicer in the manner and
subject to the provisions of Section 8.01 of the Sale and Servicing Agreement.
(c) Except as provided in Sections 9.1(a) and (b) above, none
of the Depositor, the Seller, the Administrator, or the Transferor shall be
entitled to revoke or terminate the Trust.
(d) Notice of any termination of the Trust, specifying the
Payment Date upon which the Transferor shall surrender their Ownership Interest
to the Paying Agent for payment of the final distributions and cancellation,
shall be given by the Registrar to the Transferor, the Insurer and the Rating
Agencies mailed within five Business Days of receipt by the Registrar of notice
of such termination pursuant to (a) or (b) above, which notice given by the
Owner Trustee shall state (i) the Payment Date upon or with respect to which
final payment of the Registrar shall be made upon presentation and surrender of
the Ownership Interest 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 Payment Date is not applicable, payments being made
only upon submission of a claim for and acknowledgment of final distribution
under the Ownership Interest at the office of the Paying Agent therein
specified. The Registrar shall give such notice to the Owner Trustee and the
Paying Agent at the time such notice is given to the Transferor. Upon
presentation of such submission of a claim for and acknowledgment of final
distribution under the Ownership Interest, the Paying Agent shall cause to be
distributed to the Transferor amounts distributable on such Payment Date
pursuant to Section 5.01 of the Sale and Servicing Agreement.
In the event that the Transferor shall not have submitted
claim for and acknowledgment of final distribution under the Ownership Interest
for cancellation within six
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months after the date specified in the above mentioned written notice, the
Registrar shall give a second written notice to the Transferor with respect
thereto. If within one year after such second notice, the Registrar may take
appropriate steps, or may appoint an agent to take appropriate steps, to contact
the Transferor concerning the final distribution, and the cost thereof shall be
paid out of the funds and other assets that shall remain subject to this
Agreement.
(e) Upon the winding up of the Trust and its termination, the
Owner Trustee shall cause the Certificate of Trust to be canceled by filing a
certificate of cancellation with the Secretary of State in accordance with the
Business Trust Statute.
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ARTICLE X
SUCCESSOR OWNER TRUSTEES AND ADDITIONAL OWNER TRUSTEES
Section 10.1 Eligibility Requirements for Owner Trustee. The Owner
Trustee shall at all times be a corporation satisfying the provisions of the
Business Trust Statute; authorized to exercise corporate powers; having a
combined capital and surplus of at least $50,000,000 and subject to supervision
or examination by Federal or state authorities; and having (or having a parent
which has) a long-term rating of at least "A" (or its equivalent) by each of
Standard & Poor's, and Fitch and being acceptable to the Insurer. 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 10.1, the Owner Trustee shall resign immediately in the manner and
with the effect specified in Section 10.2.
Section 10.2 Resignation or Removal of Owner Trustee. The Owner Trustee
may at any time resign and be discharged from the trusts hereby created by
giving written notice thereof to the Trust, the Indenture Trustee, the Rating
Agencies, the Insurer and the Seller. Upon receiving such notice of resignation,
the Indenture Trustee shall promptly appoint a successor Owner Trustee with the
consent of the Insurer, which consent shall not be unreasonably withheld, 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 or the Insurer may petition any court
of competent jurisdiction for the appointment of a successor Owner Trustee.
If at any time the Owner Trustee shall cease to be eligible in
accordance with the provisions of Section 10.1 above and shall fail to resign
after written request therefor by the Indenture Trustee, 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 Indenture Trustee may, and, at the
direction of the Insurer, shall, remove the Owner Trustee. If the Indenture
Trustee shall remove the Owner Trustee under the authority of the immediately
preceding sentence, the Indenture Trustee shall promptly appoint a successor
Owner Trustee acceptable to the Insurer by written instrument in duplicate, one
copy of which instrument shall be delivered to the outgoing Owner Trustee so
removed and one copy to the successor Owner Trustee and payment of 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 10.2
shall not become effective until acceptance of appointment by the successor
Owner Trustee pursuant to Section 10.3, written
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approval by the Insurer and payment of all fees and expenses owed to the
outgoing Owner Trustee. The Indenture Trustee shall provide notice of such
resignation or removal of the Owner Trustee to each of the Rating Agencies.
Section 10.3 Successor Owner Trustee. Any successor Owner Trustee
appointed pursuant to Section 10.2 shall execute, acknowledge and deliver to the
Indenture Trustee, the Insurer 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 (if acceptable to the Insurer), 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 Indenture Trustee 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 10.3 unless at the time of such acceptance such successor Owner Trustee
shall be eligible pursuant to Section 10.1 above.
Upon acceptance of appointment by a successor Owner Trustee pursuant to
this Section 10.3, the Indenture Trustee shall mail notice of the successor of
such Owner Trustee to the Transferor, the Noteholders, the Insurer and the
Rating Agencies. If the Indenture Trustee fails to mail such notice within 10
days after acceptance of appointment by the successor Owner Trustee, the
successor Owner Trustee shall cause such notice to be mailed at the expense of
the Indenture Trustee.
Section 10.4 Merger or Consolidation of Owner Trustee. Any corporation
into which the Owner Trustee may be merged or converted or with which either 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, as the case may be,
hereunder, provided such corporation shall be eligible pursuant to Section 10.1
above, without the execution or filing of any instrument or any further act on
the part of any of the parties hereto, anything herein to the contrary
notwithstanding; provided further that the Owner Trustee, shall mail notice of
such merger or consolidation to the Depositor, the Seller, the Rating Agencies
and the Insurer.
Section 10.5 Appointment of Co-Owner Trustee or Separate Owner 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 Mortgaged Property may at the time be located,
the Owner Trustee (with the consent of the
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Insurer, which consent shall not be unreasonably withheld) shall have the power
and shall execute and deliver all instruments to appoint one or more Persons to
act as co-owner trustee, jointly with the Owner Trustee, or separate owner
trustee or separate owner 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 Owner Trustee may consider
necessary or desirable. No co-owner trustee or separate trustee under this
Section 10.5 shall be required to meet the terms of eligibility as a successor
Owner Trustee pursuant to Section 10.1 above and no notice of the appointment of
any co-owner trustee or separate trustee shall be required pursuant to Section
10.3 above.
The Owner Trustee hereby appoints the Indenture Trustee for the purpose
of establishing and maintaining the Distribution Account and making the
distributions therefrom to the Persons entitled thereto pursuant to Section 5.01
of the Sale and Servicing Agreement.
Each separate trustee and co-owner trustee shall, to the extent
permitted by law, be appointed and act subject to the following provision and
conditions:
(i) all rights, powers, duties and obligations conferred or
imposed upon the Owner Trustee shall be conferred upon and exercised or
performed by the Owner Trustee and such separate owner trustee or
co-owner trustee jointly (it being understood that such separate owner
trustee or co-owner trustee is not authorized to act separately without
the Owner Trustee joining in such act), except to the extent that under
any law of any jurisdiction in which any particular act or acts are to
be performed, the Owner Trustee shall be incompetent or unqualified to
perform such act or acts, in which event such rights, powers, duties,
and obligations (including the holding of title to the Trust or any
portion thereof in any such jurisdiction) shall be exercised and
performed singly by such separate trustee or co-owner trustee but
solely at the direction of the Owner Trustee;
(ii) no owner trustee under this Agreement shall be personally
liable by reason of any act or omission of any other owner trustee
under this Agreement; and
(iii) the Owner Trustee may at any time accept the resignation
of or remove any separate trustee or co-owner trustee.
Any notice, request or other writing given to the Owner Trustee shall
be deemed to have been given to the separate trustees and co-owner trustees, as
if given to each of them. Every instrument appointing any separate owner trustee
or co-owner trustee, other than this Agreement, shall refer to this Agreement
and to the conditions of this Article X. Each separate trustee and co-owner
trustee, upon its acceptance of appointment, shall be vested with the estates
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.
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Any separate trustee or co-owner 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 owner trustee or co-owner
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 trustee.
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ARTICLE XI
MISCELLANEOUS
Section 11.1 Supplements and Amendments. This Agreement may be amended
by the Depositor, the Seller and the Owner Trustee with prior written notice to
the Rating Agencies and the Indenture Trustee and with the consent of the
Insurer (which consent shall not be unreasonably withheld), but without the
consent of any of the Noteholders, the Transferor or the Indenture Trustee, 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 Transferor; provided, however, that
such action shall not adversely affect in any material respect the interests of
any Noteholder, the Transferor or the Insurer. An amendment described above
shall be deemed not to adversely affect in any material respect the interests of
any Noteholder, the Transferor or the Insurer if (i) an Opinion of Counsel is
obtained to such effect, (ii) the party requesting the amendment satisfies the
Rating Agency Condition with respect to such amendment.
This Agreement may also be amended from time to time by the Seller and
the Owner Trustee, with the prior written consent of the Rating Agencies, the
Insurer and the Indenture Trustee, the Noteholders evidencing more than 50% of
the Percentage Interests in the Notes and the Transferor, 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 Transferor; 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 the Mortgage Loans or distributions that
shall be required to be made for the benefit of the Noteholders or the
Transferor or (b) reduce the aforesaid Percentage Interests required to consent
to any such amendment, without the consent of the holders of all the outstanding
Notes. The Depositor shall join in any such amendment approved as provided in
the preceding sentence so long as such amendment is not adverse to the interests
of the Depositor.
Promptly after the execution of any such amendment, the Owner Trustee
shall furnish written notification of the substance of such amendment to the
Indenture Trustee, the Insurer and each of the Rating Agencies.
It shall not be necessary for the consent of the Transferor, the
Noteholders or the Indenture Trustee pursuant to this Section 11.1 to approve
the particular form of any proposed amendment, but it shall be sufficient if
such consent shall approve the substance thereof. The manner of obtaining such
consents (and any other consents of the Transferor provided for in this
Agreement or in any other Transaction Document) and of evidencing the
authorization of the execution thereof by the Transferor and the Noteholders
shall be subject to such reasonable requirements as the Owner Trustee may
prescribe.
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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 and that all conditions precedent to
such execution and delivery have been satisfied. The Owner Trustee may, but
shall not be obligated to, enter into any such amendment which affects the Owner
Trustee's own rights, duties or immunities under this Agreement or otherwise.
Section 11.2 No Legal Title to Owner Trust Estate in Transferor. The
Transferor shall not have legal title to any part of the Owner Trust Estate. The
Transferor shall be entitled to receive distributions with respect to their
undivided ownership interest therein only in accordance with Articles V and IX
herein. No transfer, by operation of law or otherwise, of any right, title, or
interest of the Transferor to and in its Ownership Interest shall operate to
terminate this Agreement or the trusts hereunder or entitle any transferee to an
accounting or to the transfer to it of legal title to any part of the Owner
Trust Estate.
Section 11.3 Limitations on Rights of Others. The provisions of this
Agreement are solely for the benefit of the Owner Trustee, the Seller, the
Trust, the Insurer, the Transferor and, to the extent expressly provided herein,
the Indenture Trustee, the Insurer and the Noteholders, and nothing in this
Agreement, whether express or implied, shall be construed to give to any other
Person any legal or equitable right, remedy or claim in the Owner Trust Estate
or under or in respect of this Agreement or any covenants, conditions or
provisions contained herein.
Section 11.4 Notices.
(a) Unless otherwise expressly specified or permitted by the
terms hereof, all notices shall be in writing and shall be deemed given upon
receipt by the intended recipient or three Business Days after mailing if mailed
by certified mail, postage prepaid (except that notice to the Owner Trustee
shall be deemed given only upon actual receipt by the Owner Trustee), at the
following addresses: (i) if to the Owner Trustee, its Corporate Trust Office;
(ii) if to the Depositor, [_______], [_______]; (iii) if to the Insurer,
[_______]; (iv) if to the Indenture Trustee, its Corporate Trust Office; (v) if
to the Transferor, [_______]; (vi) if to the Seller, [_______]; or, as to each
such 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 the
Transferor shall be given by first-class mail, postage prepaid, at the address
of such Transferor as shown in the 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 Transferor receives such notice.
Section 11.5 Severability. Any provision of this Agreement that is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such
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prohibition or unenforceability without invalidating the remaining provisions
hereof, and any such prohibition or unenforceability in any jurisdiction shall
not invalidate or render unenforceable such provision in any other jurisdiction.
Section 11.6 Separate Counterparts. This Agreement may be executed by
the parties hereto in separate counterparts, each of which when so executed and
delivered shall be an original, but all such counterparts shall together
constitute but one and the same instrument.
Section 11.7 Successors and Assigns. All covenants and agreements
contained herein shall be binding upon, and inure to the benefit of the Seller,
the Owner Trustee, the Insurer and its successors and the Transferor and its
successors and permitted assigns, all as herein provided. Any request, notice,
direction, consent, waiver or other instrument or action by the Transferor shall
bind the successors and assigns of the Transferor.
Section 11.8 No Petition. The Owner Trustee, by entering into this
Agreement, the Transferor, by accepting the Ownership Interest, 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 Transferor or the Trust, or join in any institution against the
Transferor, or the Trust of, any bankruptcy, reorganization, arrangement,
insolvency or liquidation proceedings, or other proceedings under any United
States Federal or state bankruptcy or law in connection with any obligations
relating to the Ownership Interest and the Notes, this Agreement or any of the
Transaction Documents.
Section 11.9 [Reserved].
Section 11.10 No Recourse. The Transferor by accepting the Ownership
Interest acknowledges that the Transferor's Ownership Interest represents a
beneficial interest in the Trust only and does not represent an interest in or
an obligation of the Servicer, the Seller, the Owner 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 Ownership
Interest or the Transaction 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.
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Section 11.13 Inconsistencies with Sale and Servicing Agreement.
In the event certain provisions of this Agreement conflict with the
provisions of the Sale and Servicing Agreement, the parties hereto agree that
the provisions of the Sale and Servicing Agreement shall be controlling.
Section 11.14 Third Party Beneficiary.
The parties hereto acknowledge that the Insurer is an express third
party beneficiary hereof entitled to enforce the provisions hereof as if it were
actually a party hereto. Nothing in this Section 11.14 however shall be
construed to mitigate in any way, the fiduciary responsibilities of the Owner
Trustee to the beneficiaries of the Trust.
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IN WITNESS WHEREOF, the parties hereto have caused this Trust Agreement
to be duly executed by their respective officers hereunto duly authorized, as of
the day and year first above written.
[ ]
as Owner Trustee
By:__________________________________
Name:
Title:
[ ],
as Depositor
By:__________________________________
Name:
Title:
[ ],
as Seller
By:__________________________________
Name:
Title:
41
EXHIBIT A
CERTIFICATE OF TRUST OF
[ ] HOME EQUITY LOAN TRUST [ ]
THIS Certificate of Trust of [ ] HOME EQUITY LOAN TRUST [ ] (the
"Trust"), 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. Code, Section 3801 et seq.)(the "Act").
1. Name. The name of the business trust formed hereby is [ ] HOME
EQUITY LOAN TRUST [ ].
2. Delaware Trustee. The name and business address of the trustee of
the Trust in the State of Delaware is [ ]. Attention: Corporate Trust
Administration Department.
IN WITNESS WHEREOF, the undersigned, being the sole trustee of the
Trust, has executed this Certificate of Trust in accordance with Section 3811(a)
of the Act.
[ ], not in its individual capacity but
solely as Owner Trustee under a Trust
Agreement dated as of [ ].
By: ________________________________________
Name:
Title:
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EXHIBIT B
TRANSFER CERTIFICATE
[Owner Trustee]
________________________________
________________________________
________________________________
Attention: [____________________]
Re: Trust Agreement, dated as of [ ], among
[ ] Home Equity Loan Trust 200_-_, [
] and [ ], as Owner
Trustee; [ ] Home Equity Loan Trust 200_-_, Home
Equity Loan Asset-Backed Notes, Series 200_-_
Ladies and Gentlemen:
The undersigned (the "Transferee") has agreed to purchase from
_________________________ (the "Transferor") the Ownership Interest:
A. Rule 144A "Qualified Institutional Buyers" should complete
this section
I. The Transferee is (check one):
-- (i) An insurance company, as defined in Section 2(13)
of the Securities Act of 1933, as amended (the
"Securities Act"), (ii) an investment company
registered under the Investment Company Act of 1940,
as amended (the "Investment Company Act"), (iii) a
business development company as defined in Section
2(a)(48) of the Securities Act, (iv) a Small Business
Investment Company licensed by the U.S. Small
Business Administration under Section 301(c) or (d)
of the Small Business Investment Act of 1958, (v) a
plan established and maintained by a state, its
political subdivisions, or any agency or
instrumentality of a state or its political
subdivisions, for the benefit of its employees, (vi)
an employee benefit plan within the meaning of Title
I of the Employee Retirement Income Security Act of
1974, as amended ("ERISA"), (vii) a business
development company as defined in Section 202(a)(22)
of the Investment Advisors Act of 1940, (viii) an
organization described in Section 501(c)(3) of the
Internal Revenue Code, corporation (other than a bank
as defined in Section 3(a)(2) of the Securities Act
or a savings and loan association or
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other institution referenced in Section 3(a)(2) of
the Securities Act or a foreign bank or savings and
loan association or equivalent institution),
partnership, or Massachusetts or similar business
trust; or (ix) an investment advisor registered under
the Investment Advisors Act of 1940, which, for each
of (i) through (ix), owns and invests on a
discretionary basis at least $100 million in
securities other than securities of issuers
affiliated with the Transferee, securities issued or
guaranteed by the United States or a person
controlled or supervised by and acting as an
instrumentality of the government of the United
States pursuant to authority granted by the Congress
of the United States, bank deposit notes and
certificates of deposit, loan participations,
repurchase agreements, securities owned but subject
to a repurchase agreement, and currency, interest
rate and commodity swaps (collectively, "Excluded
Securities");
-- a dealer registered pursuant to Section 15 of the
Securities Exchange Act of 1934, as amended (the
"Exchange Act") that in the aggregate owns and
invests on a discretionary basis at least $10 million
of securities other than Excluded Securities and
securities constituting the whole or part of an
unsold allotment to, or subscription by, Transferee
as a participant in a public offering;
-- an investment company registered under the Investment
Company Act that is part of a family of investment
companies (as defined in Rule 144A of the Securities
and Exchange Commission) which own in the aggregate
at least $100 million in securities other than
Excluded Securities and securities of issuers that
are part of such family of investment companies;
-- an entity, all of the equity owners of which are
entities described in this Paragraph A(I);
-- a bank as defined in Section 3(a)(2) of the
Securities Act, any savings and loan association or
other institution as referenced in Section 3(a)(5)(A)
of the Securities Act, or any foreign bank or savings
and loan association or equivalent institution that
in the aggregate owns and invests on a discretionary
basis at least $100 million in securities other than
Excluded Securities and has an audited net worth of
at least $25 million as demonstrated in its latest
annual financial statements, as of a date not more
than 16 months preceding the date of transfer of the
Ownership Interest to the Transferee in the case of a
U.S. Bank or savings and loan association, and not
more than 18 months preceding such date in the case
of a foreign bank or savings association or
equivalent institution.
II. The Transferee is acquiring such Ownership Interest solely
for its own account, for the account of one or more others, all of which are
"Qualified Institutional Buyers"
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within the meaning of Rule 144A, or in its capacity as a dealer registered
pursuant to Section 15 of the Exchange Act acting in a riskless principal
transaction on behalf of a "Qualified Institutional Buyer". The Transferee is
not acquiring such Ownership Interest with a view to or for the resale,
distribution, subdivision or fractionalization thereof which would require
registration of the Ownership Interest under the Securities Act.
B. "Accredited Investors" should complete this Section
I. The Transferee is (check one):
a bank within the meaning of Section 3(a)(2) of the
----- Securities Act;
a savings and loan association or other institution
----- defined in Section 3(a)(5) of the Securities Act;
a broker or dealer registered pursuant to the
----- Exchange Act;
an insurance company within the meaning of Section
----- 2(13) of the Securities Act;
an investment company registered under the Investment
----- Company Act;
an employee benefit plan within the meaning of Title
----- I of ERISA, which has total assets in excess of
$5,000,000;
another entity which is an "accredited investor"
----- within the meaning of paragraph (fill in) of
subsection (a) of Rule 501 of the Securities and
Exchange Commission.
II. The Transferee is acquiring such Ownership Interest solely
for its own account, for investment, and not with a view to or for the resale,
distribution, subdivision or fractionalization thereof which would require
registration of the Ownership Interest under the Securities Act.
C. If the Transferee is unable to complete one of paragraph
A(I) or paragraph B(I) above, the Transferee must furnish an opinion in form and
substance satisfactory to the Trustee of counsel satisfactory to the Trustee to
the effect that such purchase will not violate any applicable federal or state
securities laws.
D. The Transferee represents that it is not (A) an "employee
benefit plan" within the meaning of Section 3(3) of the Employee Retirement
Income Security Act of 1974, as amended ("ERISA"), or (B) a "plan" within the
meaning of Section 4975(e)(1) of the Code (any such plan or employee benefit
plan, a "Plan") or (C) any entity, including an insurance company separate
account or general account, whose underlying assets include plan assets by
reason of a
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plan's investment in the entity and is not directly or indirectly purchasing
such Trust Security on behalf of, as investment manager of, as named fiduciary
of, as trustee of, or with assets of a Plan.
(iii) the Transferee is an "accredited investor" as defined in
Rule 501(a) of Regulation D pursuant to the Securities Act.
Very truly yours,
[NAME OF PURCHASER]
By: ___________________________________
Title:_________________________________
Dated:
THE FOREGOING IS ACKNOWLEDGED THIS ____ DAY OF __________, 199_.
[NAME OF SELLER]
By: ___________________________________
Title:_________________________________
B-4
