EXECUTION COPY
BEAR ▇▇▇▇▇▇▇ ASSET BACKED SECURITIES, INC.,
as Depositor,
and
WILMINGTON TRUST COMPANY,
as Owner Trustee
TRUST AGREEMENT
Dated as of August 1, 2003
Home Equity Loan-Backed Certificates,
Series 2003-C
TABLE OF CONTENTS
PAGE
ARTICLE I DEFINITIONS........................................................1
1.01 DEFINITIONS................................................1
1.02 OTHER DEFINITIONAL PROVISIONS..............................1
ARTICLE II ORGANIZATION......................................................2
2.01 NAME.......................................................2
2.02 OFFICE.....................................................2
2.03 PURPOSES AND POWERS........................................2
2.04 APPOINTMENT OF OWNER TRUSTEE...............................3
2.05 INITIAL CAPITAL CONTRIBUTION OF TRUST ESTATE...............3
2.06 DECLARATION OF TRUST.......................................3
2.07 TITLE TO TRUST PROPERTY....................................4
2.08 SITUS OF TRUST.............................................4
2.09 REPRESENTATIONS AND WARRANTIES OF THE DEPOSITOR............4
2.10 PAYMENT OF TRUST FEES......................................5
2.11 COVENANTS AND RESTRICTIONS ON CONDUCT OF BUSINESS..........5
ARTICLE III THE CERTIFICATES.................................................7
3.01 INITIAL OWNERSHIP..........................................7
3.02 THE INITIAL CERTIFICATE....................................7
3.03 AUTHENTICATION OF CERTIFICATE..............................7
3.04 REGISTRATION OF AND LIMITATIONS ON TRANSFER AND
EXCHANGE OF CERTIFICATE....................................7
3.05 MUTILATED, DESTROYED, LOST OR STOLEN CERTIFICATE..........10
3.06 PERSONS DEEMED CERTIFICATEHOLDERS.........................11
3.07 MAINTENANCE OF OFFICE OR AGENCY...........................11
3.08 CERTIFICATE PAYING AGENT..................................11
3.09 ACCESS TO LIST OF CERTIFICATEHOLDERS' NAMES AND ADDRESSES.12
3.10 TAX TREATMENT.............................................13
3.11 FEDERAL INCOME TAX ALLOCATIONS............................13
3.12 SUBORDINATION.............................................13
ARTICLE IV AUTHORITY AND DUTIES OF OWNER TRUSTEE............................13
4.01 GENERAL AUTHORITY.........................................13
4.02 GENERAL DUTIES............................................14
4.03 ACTION UPON INSTRUCTION...................................14
4.04 NO DUTIES EXCEPT AS SPECIFIED UNDER SPECIFIED
DOCUMENTS OR IN INSTRUCTIONS..............................15
4.05 RESTRICTIONS..............................................15
4.06 PRIOR NOTICE TO CERTIFICATEHOLDERS WITH RESPECT TO
CERTAIN MATTERS...........................................15
4.07 ACTION BY CERTIFICATEHOLDERS WITH RESPECT TO CERTAIN
MATTERS...................................................16
4.08 ACTION WITH RESPECT TO BANKRUPTCY.........................16
4.09 RESTRICTIONS ON CERTIFICATEHOLDERS' POWER.................17
4.10 DOING BUSINESS IN OTHER JURISDICTIONS.....................17
4.11 MAJORITY CONTROL..........................................17
ARTICLE V APPLICATION OF TRUST ESTATE.......................................17
5.01 DISTRIBUTIONS.............................................17
5.02 METHOD OF PAYMENT.........................................17
5.03 SIGNATURE ON RETURNS......................................17
5.04 STATEMENTS TO CERTIFICATEHOLDERS..........................17
5.05 TAX REPORTING; TAX ELECTIONS..............................17
ARTICLE VI CONCERNING THE OWNER TRUSTEE.....................................17
6.01 ACCEPTANCE OF TRUSTS AND DUTIES...........................17
6.02 FURNISHING OF DOCUMENTS...................................17
6.03 REPRESENTATIONS AND WARRANTIES............................17
6.04 RELIANCE; ADVICE OF COUNSEL...............................17
6.05 NOT ACTING IN INDIVIDUAL CAPACITY.........................17
6.06 OWNER TRUSTEE NOT LIABLE FOR CERTIFICATES OR
RELATED DOCUMENTS.........................................17
6.07 OWNER TRUSTEE MAY OWN CERTIFICATES AND NOTES...............17
ARTICLE VII COMPENSATION OF OWNER TRUSTEE....................................17
7.01 OWNER TRUSTEE'S FEES AND EXPENSE...........................17
7.02 INDEMNIFICATION............................................17
ARTICLE VIII TERMINATION OF TRUST AGREEMENT..................................17
8.01 TERMINATION OF TRUST AGREEMENT.............................17
ARTICLE IX SUCCESSOR OWNER TRUSTEES AND ADDITIONAL OWNER TRUSTEES............17
9.01 ELIGIBILITY REQUIREMENTS FOR OWNER TRUSTEE.................17
9.02 REPLACEMENT OF OWNER TRUSTEE...............................17
9.03 SUCCESSOR OWNER TRUSTEE....................................17
9.04 MERGER OR CONSOLIDATION OF OWNER TRUSTEE...................17
9.05 APPOINTMENT OF CO-TRUSTEE OR SEPARATE TRUSTEE..............17
ARTICLE X MISCELLANEOUS......................................................17
10.01 AMENDMENTS.................................................17
10.02 NO LEGAL TITLE TO TRUST ESTATE.............................17
10.03 LIMITATIONS ON RIGHTS OF OTHERS............................17
10.04 NOTICES....................................................17
10.05 SEVERABILITY OF PROVISIONS.................................17
10.06 COUNTERPARTS...............................................17
10.07 SUCCESSORS AND ASSIGNS.....................................17
10.08 NO PETITION................................................17
10.09 NO RECOURSE................................................17
10.10 HEADINGS...................................................17
10.11 GOVERNING LAW..............................................17
10.12 INTEGRATION................................................17
10.13 CERTIFICATES NONASSESSABLE.................................17
Exhibit A Form of Certificate............................................A-1
Exhibit B Certificate of Trust of ▇▇▇▇▇ Whole Loan Home
Equity Trust 2003-C............................................B-1
Exhibit C Form of Rule 144A Investment Representation....................C-1
Exhibit D Form of Investor Representation Letter.........................D-1
Exhibit E Form of Transferor Representation Letter.......................E-1
Exhibit F Certificate of Non-Foreign Status..............................F-1
Exhibit G Form of ERISA Representation Letter............................G-1
Exhibit H Form of Representation Letter..................................H-1
This Trust Agreement, dated as of August 1, 2003 (as amended from time to
time, the "Agreement"), is between Bear ▇▇▇▇▇▇▇ Asset Backed Securities, Inc., a
Delaware corporation, as Depositor (the "Depositor"), and Wilmington Trust
Company, a Delaware banking corporation, as trustee (the "Owner Trustee").
WlTNESSETH:
In consideration of the mutual agreements herein contained, the Depositor
and the Owner Trustee hereby agree as follows:
WHEREAS, the Depositor and the Owner Trustee desire to form a Delaware
statutory trust;
NOW, THEREFORE, in consideration of the mutual agreements herein contained,
the parties hereto agree as follows:
ARTICLE I
DEFINITIONS
1.01 DEFINITIONS. For all purposes of this Agreement, except as otherwise
expressly provided herein or unless the context otherwise requires, capitalized
terms used herein that are not otherwise defined shall have the meanings
ascribed thereto in Appendix A to the indenture dated as of August 1, 2003 (the
"Indenture"), between ▇▇▇▇▇ Whole Loan Home Equity Trust 2003-C, as issuer, and
▇▇▇▇▇ Fargo Bank Minnesota, National Association, as indenture trustee. All
other capitalized terms used herein shall have the meanings specified herein.
All references herein to "this Agreement" shall be references to this Agreement
as defined in the preamble hereto.
1.02 OTHER DEFINITIONAL PROVISIONS.
(a) All terms defined in this Agreement shall have the defined meanings
when used in any certificate or other document made or delivered pursuant hereto
unless otherwise defined therein.
(b) As used in this Agreement and in any certificate or other document made
or delivered pursuant hereto or thereto, accounting terms not defined in this
Agreement or in any such certificate or other document, and accounting terms
partly defined in this Agreement or in any such certificate or other document to
the extent not defined, shall have the respective meanings given to them under
generally accepted accounting principles. To the extent that the definitions of
accounting terms in this Agreement or in any such certificate or other document
are inconsistent with the meanings of such terms under generally accepted
accounting principles, the definitions contained in this Agreement or in any
such certificate or other document shall control.
(c) The words "hereof," "herein," "hereunder" and words of similar import
when used in this Agreement shall refer to this Agreement as a whole and not to
any particular provision of this Agreement; Section and Exhibit references
contained in this Agreement are references to Sections and Exhibits in or to
this Agreement unless otherwise specified; "or" includes "and/or"; and the term
"including" and all variations thereof means "including without limitation".
(d) The definitions contained in this Agreement are applicable to the
singular as well as the plural forms of such terms and to the masculine as well
as to the feminine and neuter genders of such terms.
(e) Any agreement, instrument or statute defined or referred to herein or
in any instrument or certificate delivered in connection herewith means such
agreement, instrument or statute as from time to time amended, modified or
supplemented and includes (in the case of agreements or instruments) references
to all attachments thereto and instruments incorporated therein; references to a
Person are also to its permitted successors and assigns.
ARTICLE II
ORGANIZATION
2.01 NAME. The trust created hereby (the "Trust") shall be known as "▇▇▇▇▇
Whole Loan Home Equity Trust 2003-C", in which name the Owner Trustee may
conduct the business of the Trust, make and execute contracts and other
instruments on behalf of the Trust and ▇▇▇ and be sued.
2.02 OFFICE. The office of the Trust shall be in care of the Owner Trustee
at the Corporate Trust Office of the Owner Trustee or at such other address in
Delaware as the Owner Trustee may designate by written notice to the
Certificateholders and the Indenture Trustee.
2.03 PURPOSES AND POWERS. The purpose of the Trust is to engage in the
following activities:
(a) to issue the Notes pursuant to the Indenture and the Certificates
pursuant to this Agreement and to sell the Notes and the Certificates;
(b) to purchase the Mortgage Loans and to pay the organizational, start-up
and transactional expenses of the Trust;
(c) to assign, grant, transfer, pledge and convey the Mortgage Loans
pursuant to the Indenture and to hold, manage and distribute to the
Certificateholders pursuant to Section 5.01 any portion of the Mortgage Loans
released from the Lien of, and remitted to the Trust pursuant to, the Indenture;
(d) to enter into and perform its obligations under the Basic Documents to
which it is to be a party;
(e) to engage in those activities, including entering into agreements, that
are necessary, suitable or convenient to accomplish the foregoing or are
incidental thereto or connected therewith, including to accept additional
contributions of equity that are not subject to the Lien of the Indenture; and
(f) subject to compliance with the Basic Documents, to engage in such other
activities as may be required in connection with conservation of the Trust
Estate and the making of distributions to the Certificateholders and the
Noteholders.
The Trust is hereby authorized to engage in the foregoing activities. The
Trust shall not (i) engage in any activity other than in connection with the
foregoing or other than as required or authorized by the terms of this Agreement
or the other Basic Documents while any Note is outstanding without the consent
of the Indenture Trustee or (ii) elect to be treated for federal income tax
purposes as a corporation under Treasury Regulations Section 301.7701-3(c).
2.04 APPOINTMENT OF OWNER TRUSTEE. The Depositor hereby appoints the Owner
Trustee as trustee of the Trust effective as of the date hereof, to have all
rights, powers and duties set forth herein.
2.05 INITIAL CAPITAL CONTRIBUTION OF TRUST ESTATE. In consideration of the
delivery by the Owner Trustee, on behalf of the Trust, of the Securities to the
Depositor or its designee, upon the order of the Depositor, the Depositor, as of
the Closing Date and concurrently with the execution and delivery hereof, does
hereby sell, transfer, assign, set over and otherwise convey to the Trust,
without recourse, but subject to the other terms and provisions of this
Agreement, all of the right, title and interest of the Depositor in and to the
Trust Estate. The foregoing sale, transfer, assignment, set over and conveyance
does not, and is not intended to, result in a creation or an assumption by the
Trust of any obligation of the Depositor or any other Person in connection with
the Trust Estate or under any agreement or instrument relating thereto, except
as specifically set forth herein.
The Owner Trustee, on behalf of the Trust, acknowledges the conveyance to
the Trust by the Depositor, as of the Closing Date, of the Trust Estate,
including all right, title and interest of the Depositor in and to the Trust
Estate. Concurrently with such conveyance and in exchange therefor, the Trust
has pledged the Trust Estate to the Indenture Trustee and has executed the
Certificates and the Notes and caused them to be duly authenticated and
delivered to or upon the order of the Depositor.
2.06 DECLARATION OF TRUST. The Owner Trustee hereby declares that it shall
hold the Trust Estate in trust upon and subject to the conditions set forth
herein for the use and benefit of the Certificateholders, subject to the
obligations of the Trust under the Basic Documents. It is the intention of the
parties hereto that the Trust constitute a statutory trust under the Statutory
Trust Statute and that this Agreement constitute the governing instrument of
such statutory trust. Effective as of the date hereof, the Owner Trustee shall
have all rights, powers and duties set forth herein and in the Statutory Trust
Statute with respect to accomplishing the purposes of the Trust. Neither the
Depositor nor any Certificateholder shall have any personal liability for any
liability or obligation of the Trust, other than the indemnification obligation
provided in Section 7.02 herein.
2.07 TITLE TO TRUST PROPERTY. Legal title to the Trust Estate shall be
vested at all times in the Trust as a separate legal entity except where
applicable law in any jurisdiction requires title to any part of the Trust
Estate to be vested in a trustee or trustees, in which case title shall be
deemed to be vested in the Owner Trustee, a co-trustee or a separate trustee, as
the case may be.
2.08 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 States of Delaware, New York or Minnesota.
The Trust shall not have any employees in any State other than Delaware;
provided, that nothing herein shall restrict or prohibit the Owner Trustee from
having employees within or without the State of Delaware or taking actions
outside the State of Delaware in order to comply with Section 2.03. Payments
will be received by the Trust only in Delaware, New York or Minnesota, and
payments will be made by the Trust only from Delaware, New York or Minnesota.
The only office of the Trust will be at the Corporate Trust Office of the Owner
Trustee in Delaware.
2.09 REPRESENTATIONS AND WARRANTIES OF THE DEPOSITOR. The Depositor hereby
represents and warrants to the Owner Trustee that:
(a) The Depositor is duly organized and validly existing as a corporation
in good standing under the laws of the State of Delaware, with power and
authority to own its properties and to conduct its business as such properties
are currently owned and such business is presently conducted.
(b) The Depositor is duly qualified to do business as a foreign corporation
in good standing and has obtained all necessary licenses and approvals in all
jurisdictions in which the ownership or lease of its property or the conduct of
its business shall require such qualifications and in which the failure to so
qualify would have a material adverse effect on the business, properties, assets
or condition (financial or otherwise) of the Depositor and the ability of the
Depositor to perform under this Agreement.
(c) The Depositor has full power and authority to execute and deliver this
Agreement and to carry out its terms; the Depositor has full power and authority
to sell and assign the property to be sold and assigned to and deposited with
the Trust as part of the Trust and the Depositor has duly authorized such sale
and assignment and deposit to the Trust by all necessary corporate action; and
the execution, delivery and performance of this Agreement have been duly
authorized by the Depositor by all necessary corporate action.
(d) The consummation of the transactions contemplated by this Agreement and
the fulfillment of the terms hereof do not conflict with, result in any breach
of any terms or provisions of, or constitute (with or without notice or lapse of
time) a default under, the articles of incorporation or bylaws of the Depositor,
or any indenture, agreement or other instrument to which the Depositor is a
party or by which it is bound; nor result in the creation or imposition of any
Lien upon any of its properties pursuant to the terms of any such indenture,
agreement or other instrument (other than pursuant to the Basic Documents); nor
violate any law or, to the best of the Depositor's knowledge, any order, rule or
regulation applicable to the Depositor of any court or of any federal or state
regulatory body, administrative agency or other governmental instrumentality
having jurisdiction over the Depositor or its properties.
2.10 PAYMENT OF TRUST FEES. The Owner Trustee shall pay or cause to be paid
out of the Trust Estate any fees and expenses of the Trust (other than the Owner
Trustee's fees and expenses pursuant to Section 7.01).
2.11 COVENANTS AND RESTRICTIONS ON CONDUCT OF BUSINESS.
(a) The Trust shall abide by the following restrictions:
(i) other than as contemplated by the Basic Documents and related
documentation, the Trust shall not incur any indebtedness;
(ii) other than as contemplated by the Basic Documents and related
documentation, the Trust shall not engage in any dissolution, liquidation,
consolidation, merger or sale of assets;
(iii) the Trust shall not engage in any business activity in which it
is not currently engaged other than as contemplated by the Basic Documents
and related documentation; and
(iv) the Trust shall not form, or cause to be formed, any subsidiaries
and shall not own or acquire any asset other than as contemplated by the
Basic Documents and related documentation.
(b) The Trust shall:
(i) To the extent maintained, keep its books and records separate from
any other person or entity;
(ii) maintain its office and bank accounts separate from any other
person or entity;
(iii) not commingle its assets with those of any other person or
entity;
(iv) conduct its own business in its own name and use business forms
under its own name and not that of any Certificateholder or any Affiliate;
(v) other than as contemplated by Section 7.01, the Basic Documents
and related documentation, pay its own liabilities and expenses only out of
its own funds;
(vi) observe all formalities required under the Statutory Trust Act;
(vii) not guarantee or become obligated for the debts of any other
person or entity;
(viii) not hold out its credit as being available to satisfy the
obligation of any other person or entity;
(ix) not acquire the obligations or securities of its
Certificateholders or its Affiliates;
(x) other than as contemplated by the Basic Documents and related
documentation, not make loans to any other person or entity or buy or hold
evidence of indebtedness issued by any other person or entity;
(xi) other than as contemplated by the Basic Documents and related
documentation, not pledge its assets for the benefit of any other person or
entity;
(xii) hold itself out as a separate entity from each Certificateholder
and not conduct any business in the name of any Certificateholder;
(xiii) correct any known misunderstanding regarding its separate
identity;
(xiv) not identify itself as a division of any other person or entity;
and
(xv) except as required or specifically provided in the Trust
Agreement, the Trust will conduct business with the Certificateholders or
any Affiliate thereof on an arm's-length basis.
(c) So long as the Notes or any other amounts owed under the Indenture
remain outstanding, the Trust shall not amend this Section 2.11 without the
prior written consent of each Rating Agency, in addition to the requirements
under Section 10.01.
ARTICLE III
THE CERTIFICATES
3.01 INITIAL OWNERSHIP. Upon the formation of the Trust and prior to the
issuance of the Certificates, the Depositor shall be the sole Certificateholder
of each Class of Certificates for all purposes of this Agreement.
3.02 THE INITIAL CERTIFICATE. The Certificates shall be issued in minimum
denominations of a Percentage Interest of 5.0000% and integral multiples of
5.0000% in excess thereof.
The Certificates shall be executed on behalf of the Trust by manual or
facsimile signature of an authorized officer of the Owner Trustee and
authenticated in the manner provided in Section 3.03. Any Certificate bearing
the manual or facsimile signatures of individuals who were, at the time when
such signatures shall have been affixed, authorized to sign on behalf of the
Trust, shall be validly issued and entitled to the benefit of this Agreement,
notwithstanding that such individuals or any of them shall have ceased to be so
authorized prior to the authentication and delivery of such Certificate or did
not hold such offices at the date of authentication and delivery of such
Certificate. A Person or a transferee shall become a Certificateholder and shall
be entitled to the rights and subject to the obligations of a Certificateholder
hereunder, upon such Person's or transferee's acceptance of a Certificate duly
registered in such Person's or transferee's name, pursuant to and upon
satisfaction of the conditions set forth in Section 3.04.
3.03 AUTHENTICATION OF CERTIFICATE. Concurrently with the acquisition of
the Mortgage Loans by the Trust, the Owner Trustee or the Certificate Paying
Agent shall cause the Certificates in an initial aggregate Percentage Interest
of 100.00% to be executed on behalf of the Trust, authenticated and delivered to
or upon the written order of the Depositor, signed by its chairman of the board,
its president or any vice president, without further corporate action by the
Depositor, in authorized denominations. No Certificate shall entitle its holder
to any benefit under this Agreement or be valid for any purpose unless there
shall appear on such Certificate a certificate of authentication substantially
in the form set forth in Exhibit A, executed by the Owner Trustee or the
Certificate Paying Agent, by manual signature; and such authentication shall
constitute conclusive evidence that such Certificate shall have been duly
authenticated and delivered hereunder. All Certificates shall be dated the date
of their authentication.
3.04 REGISTRATION OF AND LIMITATIONS ON TRANSFER AND EXCHANGE OF
CERTIFICATE. The Certificate Registrar shall keep or cause to be kept, at the
office or agency maintained pursuant to Section 3.07, a Certificate Register in
which, subject to such reasonable regulations as it may prescribe, the
Certificate Registrar shall provide for the registration of the Certificates and
transfers and exchanges of the Certificates as herein provided. The Indenture
Trustee shall be the initial Certificate Registrar. If the Certificate Registrar
resigns or is removed, the Owner Trustee shall appoint a successor Certificate
Registrar.
Subject to satisfaction of the conditions set forth below, upon surrender
for registration of transfer of any Certificate at the office or agency
maintained pursuant to Section 3.08, the Owner Trustee shall execute,
authenticate and deliver (or shall cause the Certificate Registrar as its
authenticating agent to authenticate and deliver) in the name of the designated
transferee or transferees, one or more new Certificates in authorized
denominations of a like aggregate amount, dated the date of authentication by
the Owner Trustee or any authenticating agent. At the option of a
Certificateholder, Certificates may be exchanged for other Certificates of
authorized denominations of a like aggregate amount upon surrender of the
Certificates to be exchanged at the office or agency maintained pursuant to
Section 3.07.
Each Certificate presented or surrendered for registration of transfer or
exchange shall be accompanied by a written instrument of transfer in form
satisfactory to the Certificate Registrar duly executed by the related
Certificateholders or such Certificateholders' attorney duly authorized in
writing. Each Certificate surrendered for registration of transfer or exchange
shall be cancelled and subsequently disposed of by the Certificate Registrar in
accordance with its customary practice.
No service charge shall be made for any registration of transfer or
exchange of the Certificate, but the Owner Trustee or the Certificate Registrar
may require payment of a sum sufficient to cover any tax or governmental charge
that may be imposed in connection with any transfer or exchange of the
Certificate.
Except as described below, each Certificateholder shall establish its
non-foreign status by submitting to the Certificate Paying Agent an IRS Form W-9
and the Certificate of Non-Foreign Status (in substantially the form attached
hereto as Exhibit F).
A Certificate may be transferred to a Certificateholder unable to establish
its non-foreign status as described in the preceding paragraph only if such
Certificateholder provides an Opinion of Counsel to the Depositor and the
Certificate Registrar, which Opinion of Counsel shall not be an expense of the
Trust, the Owner Trustee, the Certificate Registrar or the Depositor,
satisfactory to the Owner Trustee, that such transfer (i) will not affect the
tax status of the Trust and (ii) will not adversely affect the interests of any
Certificateholder or Noteholder, including as a result of the imposition of any
federal withholding taxes on the Trust (except to the extent that such
withholding taxes would be payable solely from amounts otherwise distributable
to the Certificates of the prospective transferee). If such transfer occurs and
such foreign Certificateholder becomes subject to such federal withholding
taxes, any such taxes will be withheld by the Indenture Trustee at the direction
of the Tax Matters Person. Each Certificateholder unable to establish its
non-foreign status shall submit to the Certificate Paying Agent a properly
completed copy of the type of Form W-8 that the Certificate Paying Agent shall
reasonably request and shall resubmit such form every three years or with such
frequency as required by then-applicable regulations.
No transfer, sale, pledge or other disposition of a Certificate shall be
made unless such transfer, sale, pledge or other disposition is exempt from the
registration requirements of the Securities Act and any applicable state
securities laws or is made in accordance with the Securities Act and such state
laws. In the event of any such transfer, the Owner Trustee or the Certificate
Registrar shall prior to such transfer require the transferee to execute (a)
either (i) an investment letter in substantially the form attached hereto as
Exhibit C (or in such form and substance reasonably satisfactory to the
Certificate Registrar and the Depositor), which investment letters shall not be
an expense of the Trust, the Owner Trustee, the Certificate Registrar or the
Depositor, and which investment letter states that, among other things, such
transferee (A) is a "qualified institutional buyer" as defined under Rule 144A,
acting for its own account or the accounts of other "qualified institutional
buyers" as defined under Rule 144A, and (B) is aware that the proposed
transferor intends to rely on the exemption from registration requirements under
the Securities Act provided by Rule 144A or (ii) (A) a written Opinion of
Counsel acceptable to and in form and substance satisfactory to the Indenture
Trustee and the Depositor that such transfer may be made pursuant to an
exemption, describing the applicable exemption and the basis therefor, from the
Securities Act and such state laws, or is being made pursuant to the Securities
Act and such state laws, which Opinion of Counsel shall not be an expense of the
Trust, the Owner Trustee, the Certificate Registrar or the Depositor and (B) the
transferee executes a representation letter, substantially in the form of
Exhibit D, and the transferor executes a representation letter, substantially in
the form of Exhibit E, each acceptable to and in form and substance satisfactory
to the Certificate Registrar and the Depositor, certifying the facts surrounding
such transfer, which representation letters shall not be an expense of the
Trust, the Owner Trustee, the Certificate Registrar or the Depositor and (b) the
Certificate of Non-Foreign Status substantially the form of Exhibit F,
acceptable to and in form and substance reasonably satisfactory to the
Certificate Registrar and the Depositor, which certificate shall not be an
expense of the Trust, the Owner Trustee, the Certificate Registrar or the
Depositor. If such Certificateholder is unable to provide a Certificate of
Non-Foreign Status, such Certificateholder must provide an Opinion of Counsel as
described in the preceding paragraph. The Certificateholder desiring to effect
such transfer shall, and does hereby agree to, indemnify the Trust, the Owner
Trustee, the Certificate Registrar and the Depositor against any liability that
may result if the transfer is not so exempt or is not made in accordance with
such federal and state laws.
No transfer of Certificates shall be made to any employee benefit plan or
certain other retirement plans and arrangements, including individual retirement
accounts and annuities, ▇▇▇▇▇ plans and bank collective investment funds and
insurance company general or separate accounts in which such plans, accounts or
arrangements are invested, that are subject to Section 406 of ERISA, Section
4975 of the Code or substantially similar rules under state, local or federal
law ("Similar Law") (any of the foregoing, a "Plan"), any Person acting,
directly or indirectly, on behalf of any such Plan or any Person acquiring such
Certificates with "plan assets" within the meaning of the Department of Labor
regulation promulgated at 29 C.F.R. ss. 2510.3-101 ("Plan Assets") unless the
Depositor, the Owner Trustee and the Certificate Registrar are provided with an
Opinion of Counsel that establishes to the satisfaction of the Depositor, the
Owner Trustee and the Certificate Registrar that the purchase and holding of the
Certificates is permissible under applicable law, will not constitute or result
in any prohibited transaction under ERISA, Section 4975 of the Code or Similar
Law and will not subject the Depositor, the Owner Trustee or the Certificate
Registrar to any obligation or liability (including obligations or liabilities
under ERISA, Section 4975 of the Code or Similar Law) in addition to those
undertaken in this Agreement, which Opinion of Counsel shall not be an expense
of the Depositor, the Owner Trustee or the Certificate Registrar. In lieu of
such Opinion of Counsel, a Plan, any Person acting, directly or indirectly, on
behalf of any such Plan or any Person acquiring such Certificates with Plan
Assets may provide a certification in the form of Exhibit G, upon which the
Depositor, the Owner Trustee and the Certificate Registrar may rely without
further inquiry or investigation. Neither an Opinion of Counsel nor a
certification will be required in connection with the initial transfer of any
such Certificate by the Depositor to an Affiliate of the Depositor (in which
case, the Depositor or such Affiliate shall have deemed to have represented that
such Affiliate is not a Plan or a Person investing any Plan Assets), and the
Owner Trustee shall be entitled to conclusively rely upon a representation
(which, upon the request of the Owner Trustee, shall be a written
representation) from the Depositor of the status of such transferee as an
Affiliate of the Depositor.
In addition, no transfer of a Certificate shall be permitted, and no such
transfer shall be registered by the Certificate Registrar or be effective
hereunder, unless evidenced by an Opinion of Counsel that establishes that such
transfer or the registration of such transfer would not cause the Trust or any
portion thereof to be characterized as an association (or a publicly traded
partnership) taxable as a corporation either by having more than 100 holders of
the Certificates and the Non-Offered Subordinate Notes at any time during the
taxable year of the Trust or otherwise, a corporation or a taxable mortgage pool
for federal and relevant state income tax purposes.
In addition, no transfer, sale, assignment, pledge or other disposition of
a Certificate shall be made unless the proposed transferee executes a
representation letter substantially in the form of Exhibit H, that (i) such
transferee is acquiring the Certificate for its own behalf and is not acting as
agent or custodian for any other Person or entity in connection with such
acquisition, (ii) if such transferee is a partnership, grantor trust or S
corporation for federal income tax purposes, the related Certificates represent
not more than 50% of the assets of the partnership, grantor trust or S
corporation, (iii) such transferee agrees to be bound by the Trust Agreement,
and (iv) such transferee will not (x) incur indebtedness secured by the
Certificates where payments on such indebtedness bear a relationship to payments
on the Mortgage Loans within the meaning of Treasury Regulations Section
301.7701(i)-1(f) or (y) use a partnership, trust or other entity to indirectly
achieve the result described in clause (x).
3.05 MUTILATED, DESTROYED, LOST OR STOLEN CERTIFICATE. If (i) any mutilated
Certificate shall be surrendered to the Certificate Registrar, or if the
Certificate Registrar shall receive evidence to its satisfaction of the
destruction, loss or theft of any Certificate and (ii) there shall be delivered
to the Certificate Registrar and the Owner Trustee such security or indemnity as
may be required by them to save each of them and the Issuer from harm, then in
the absence of notice to the Certificate Registrar or the Owner Trustee that
such Certificate has been acquired by a bona fide purchaser, the Owner Trustee
shall execute on behalf of the Trust and the Owner Trustee or the Certificate
Paying Agent, as the Trust's authenticating agent, shall authenticate and
deliver, in exchange for or in lieu of any such mutilated, destroyed, lost or
stolen Certificate, a new Certificate of like tenor and denomination. In
connection with the issuance of any new Certificate under this Section, the
Owner Trustee or the Certificate Registrar may require the payment of a sum
sufficient to cover any tax or other governmental charge that may be imposed in
connection therewith. Any duplicate Certificate issued pursuant to this Section
shall constitute conclusive evidence of ownership in the Trust, as if originally
issued, whether or not the lost, stolen or destroyed Certificate shall be found
at any time.
3.06 PERSONS DEEMED CERTIFICATEHOLDERS. Prior to due presentation of a
Certificate for registration of transfer, the Owner Trustee, the Certificate
Registrar or any Certificate Paying Agent may treat the Person in the name of
which any Certificate is registered in the Certificate Register as the owner of
such Certificate for the purpose of receiving distributions pursuant to Section
5.02 and for all other purposes whatsoever, and none of the Trust, the Owner
Trustee, the Certificate Registrar or the Certificate Paying Agent shall be
bound by any notice to the contrary. 3.07 MAINTENANCE OF OFFICE OR AGENCY. The
Owner Trustee, on behalf of the Trust, shall maintain in Minneapolis, Minnesota
an office or offices or agency or agencies where the Certificates may be
surrendered for registration of transfer or exchange and where notices and
demands to or upon the Owner Trustee in respect of the Certificates and the
Basic Documents may be served. The Owner Trustee initially designates the
Corporate Trust Office of the Indenture Trustee as its office for such purposes.
The Owner Trustee shall give prompt written notice to the Depositor and the
Certificateholders of any change in the location of the Certificate Register or
any such office or agency.
3.08 CERTIFICATE PAYING AGENT.
(a) The Certificate Paying Agent shall make distributions to
Certificateholders from the Trustee Collection Account on behalf of the Trust in
accordance with the provisions of the Certificates and Section 5.01 from any
payments remitted to the Certificate Paying Agent by the Indenture Trustee for
distribution to Certificateholders. The Trust hereby appoints the Indenture
Trustee as Certificate Paying Agent and the Indenture Trustee hereby accepts
such appointment and further agrees that it will be bound by the provisions of
this Agreement relating to the Certificate Paying Agent and shall:
(i) hold all sums held by it for the payment of amounts due with
respect to the Certificates in trust for the benefit of the Persons
entitled thereto until such sums shall be paid to such Persons or otherwise
disposed of as herein provided;
(ii) give the Owner Trustee notice of any default by the Trust of
which it has actual knowledge, or of the Indenture Trustee, in the making
of any payment required to be made with respect to the Certificate;
(iii) at any time during the continuance of any such default, upon the
written request of the Owner Trustee, forthwith pay to the Owner Trustee on
behalf of the Trust all sums so held in trust by such Certificate Paying
Agent;
(iv) immediately resign as Certificate Paying Agent and forthwith pay
to the Owner Trustee on behalf of the Trust all sums held by it in trust
for the payment of the Certificate, if at any time it ceases to meet the
standards required to be met by the Certificate Paying Agent at the time of
its appointment;
(v) comply with all requirements of the Code with respect to the
withholding from any payments made by it on any Certificates of any
applicable withholding taxes imposed thereon and with respect to any
applicable reporting requirements in connection therewith; and
(vi) deliver to the Owner Trustee a copy of the Report to Noteholders
prepared with respect to each Payment Date pursuant to Section 4.01 of the
Sale and Servicing Agreement.
(b) The Trust may revoke such power and remove the Certificate Paying Agent
if the Owner Trustee determines in its sole discretion that the Certificate
Paying Agent shall have failed to perform its obligations under this Agreement
in any material respect. The Indenture Trustee shall be permitted to resign as
Certificate Paying Agent upon 30 days written notice to the Owner Trustee;
provided, that the Indenture Trustee is also resigning as Paying Agent under the
Indenture at such time. In the event that the Indenture Trustee shall no longer
be the Certificate Paying Agent under this Agreement and Paying Agent under the
Indenture, the Owner Trustee shall appoint a successor to act as Certificate
Paying Agent, which shall be a bank or trust company and shall also be the
successor Paying Agent under the Indenture. The Owner Trustee shall cause such
successor Certificate Paying Agent or any additional Certificate Paying Agent
appointed by the Owner Trustee to execute and deliver to the Owner Trustee an
instrument to the effect set forth in this Section as it relates to the
Certificate Paying Agent. The Certificate Paying Agent shall return all
unclaimed funds to the Trust; and upon removal of a Certificate Paying Agent,
such Certificate Paying Agent shall also return all funds in its possession to
the Trust. The provisions of Sections 6.01, 6.03, 6.04 and 7.01 shall apply to
the Certificate Paying Agent, to the extent applicable. Any reference in this
Agreement to the Certificate Paying Agent shall include any co-paying agent,
unless the context otherwise requires.
3.09 ACCESS TO LIST OF CERTIFICATEHOLDERS' NAMES AND ADDRESSES. The
Certificate Registrar shall furnish or cause to be furnished to the Depositor or
the Owner Trustee, within 15 days after receipt by the Certificate Registrar of
a written request therefor from the Depositor or the Owner Trustee, a list, in
such form as the Depositor or the Owner Trustee, as the case may be, may
reasonably require, of the names and addresses of the Certificateholders as of
the most recent Record Date. Each Certificateholder, by receiving and holding a
Certificate, shall be deemed to have agreed not to hold any of the Trust, the
Depositor, the Certificate Registrar or the Owner Trustee accountable by reason
of the disclosure of its name and address, regardless of the source from which
such information was derived.
3.10 TAX TREATMENT. The Depositor and the Issuer acknowledge that the
Certificates shall be issued, with the intention that, for federal, state and
local income, single business and franchise tax purposes, the Non-Offered
Subordinate Notes will qualify as the sole classes of equity of the Issuer and
the Certificates will be treated as a noneconomic interest in the Issuer.
Neither the Depositor nor the Issuer will take any position inconsistent
with any such intention.
3.11 FEDERAL INCOME TAX ALLOCATIONS. If Certificates and the Non-Offered
Subordinate Notes are held by more than one Person and it is determined by the
Master Servicer that the Issuer is properly treated as a partnership for federal
income tax purposes, the net income of the Issuer for any month as determined
for federal income tax purposes (and each item of income, gain, loss, credit and
deduction entering into the computation thereof) shall be allocated among the
Certificateholders and each holder of the Non-Offered Subordinate Notes, as of
the first Record Date following the end of such month, in accordance with each
such holder's Percentage Interest in the Non-Offered Subordinate Notes. Net
losses of the Issuer, if any, for any month as determined for federal income tax
purposes (and each item of income, gain, loss, credit and deduction entering
into the computation thereof) shall be allocated among the Certificateholders as
of the first Record Date following the end of such month in accordance with each
such holder's Percentage Interest in the Non-Offered Subordinate Notes. The
Owner Trustee, on behalf of the Depositor and at the direction of the Master
Servicer, is authorized to modify the allocations in this paragraph if necessary
or appropriate, for the allocations to fairly reflect the economic income, gain
or loss to the holders of the Certificates and the Non-Offered Subordinate Notes
or as otherwise required by the Code. The Owner Trustee shall give the Master
Servicer prompt written notice of any such modification made by the Owner
Trustee.
3.12 SUBORDINATION. Except as otherwise provided in the Basic Documents,
for so long as any Notes are outstanding or unpaid, the Certificateholders will
generally be subordinated in right of payment, under the Certificates or
otherwise, to payments to the Noteholders under, or otherwise related to, the
Indenture. If an Event of Default has occurred and is continuing under the
Indenture, the Certificates will be fully subordinated as set forth in the Basic
Documents to obligations owing by the Trust to the Noteholders under, or
otherwise related to, the Indenture, and no distributions will be made on the
Certificates until the Noteholders and the Indenture Trustee have been
irrevocably paid in full.
ARTICLE IV
AUTHORITY AND DUTIES OF OWNER TRUSTEE
4.01 GENERAL AUTHORITY. The Owner Trustee is authorized and directed to
execute and deliver the Basic Documents to which the Trust is to be a party and
each certificate or other document attached as an exhibit to or contemplated by
such Basic Documents and any amendment or other agreement or instrument
described herein, in each case, in such form as the Owner Trustee shall approve,
as evidenced conclusively by the Owner Trustee's execution thereof. In addition
to the foregoing, the Owner Trustee is hereby authorized to take all actions
required of the Trust pursuant to the Basic Documents.
4.02 GENERAL DUTIES. The Owner Trustee shall be responsible to administer
the Trust pursuant to the terms of this Agreement and the Basic Documents to
which the Trust is a party and in the interest of the Certificateholders,
subject to the Basic Documents and in accordance with the provisions of this
Agreement. The Owner Trustee hereby expressly agrees to execute and deliver any
documents of the Issuer set forth in Sections 3.07, 3.10 and 10.01 of the
Indenture.
4.03 ACTION UPON INSTRUCTION.
(a) Subject to this Article and in accordance with the terms of the other
Basic Documents, the Certificateholders may by written instruction direct the
Owner Trustee in the management of the Trust. Such direction may be exercised at
any time by written instruction of the Certificateholders pursuant to this
Article.
(b) Notwithstanding the foregoing, the Owner Trustee shall not be required
to take any action hereunder or under any other Basic Document if the Owner
Trustee shall have reasonably determined, or shall have been advised by counsel,
that such action is likely to result in liability on the part of the Owner
Trustee or is contrary to the terms hereof or of any other Basic Document or is
otherwise contrary to law.
(c) Whenever the Owner Trustee is unable to decide between alternative
courses of action permitted or required by the terms of this Agreement or under
any other Basic Document, or in the event that the Owner Trustee is unsure as to
the application of any provision of this Agreement or any other Basic Document,
or any such provision is ambiguous as to its application, or is, or appears to
be, in conflict with any other applicable provision, or in the event that this
Agreement permits any determination by the Owner Trustee or is silent or is
incomplete as to the course of action that the Owner Trustee is required to take
with respect to a particular set of facts, the Owner Trustee shall promptly give
notice (in such form as shall be appropriate under the circumstances) to the
Certificateholders requesting instruction as to the course of action to be
adopted, and to the extent the Owner Trustee acts in good faith in accordance
with any written instructions received from Holders of Certificates representing
at least a majority of the aggregate Percentage Interest, 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 such shorter period as reasonably may be specified in such notice or
may be necessary under the circumstances) it may, but shall be under no duty to,
take or refrain from taking such action not inconsistent with this Agreement or
the other Basic Documents as it shall deem to be in the best interests of the
Certificateholders; and the Owner Trustee shall have no liability to any Person
for such action or inaction.
4.04 NO DUTIES EXCEPT AS SPECIFIED UNDER SPECIFIED 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 Trust Estate, or to otherwise take or refrain from
taking any action under, or in connection with, any document contemplated hereby
to which the Owner Trustee is a party, except in accordance with (i) the powers
granted to and the authority conferred upon the Owner Trustee pursuant to this
Agreement, (ii) the Basic Documents and (iii) any document or instruction
delivered to the Owner Trustee pursuant to Section 4.03; and no implied duties
or obligations shall be read into this Agreement or any other Basic Document
against the Owner Trustee. The Owner Trustee shall have no responsibility for
filing any financing or continuation statement in any public office at any time
or to otherwise perfect or maintain the perfection of any security interest or
Lien granted to it hereunder or to prepare or file any filing with the
Securities and Exchange Commission for the Trust or to record this Agreement or
any other Basic Document. The Owner Trustee nevertheless agrees that it will, at
its own cost and expense, promptly take all action as may be necessary to
discharge any Liens on any part of the 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 Trust Estate.
4.05 RESTRICTIONS.
(a) The Owner Trustee shall not take any action that (i) is inconsistent
with the purposes of the Trust set forth in Section 2.03 or (ii) to the actual
knowledge of the Owner Trustee, would result in the Trust becoming taxable as a
corporation for federal income tax purposes. The Certificateholders shall not
direct the Owner Trustee to take action that would violate the provisions of
this Section.
(b) The Owner Trustee shall not convey or transfer any of the Trust's
properties or assets, including those included in the Trust Estate, to any
person unless (i) it shall have received an Opinion of Counsel to the effect
that such transaction will not have any material adverse tax consequence to the
Trust or any Certificateholder and (ii) such conveyance or transfer shall not
violate the provisions of Section 3.16(b) of the Indenture.
4.06 PRIOR NOTICE TO CERTIFICATEHOLDERS WITH RESPECT TO CERTAIN MATTERS.
With respect to the following matters, the Owner Trustee shall not take action
unless at least 30 days before the taking of such action, the Owner Trustee
shall have notified the Certificateholders in writing of the proposed action and
Holders of Certificates representing at least a majority of the aggregate
Percentage Interest shall not have notified the Owner Trustee in writing prior
to the 30th day after such notice is given that such Certificateholders have
withheld consent or provided alternative direction:
(a) the initiation of any claim or lawsuit by the Trust (except claims or
lawsuits brought in connection with the collection of cash distributions due and
owing under 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 cash distributions due and
owing under 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 Statutory Trust
Statute);
(c) the amendment of the Indenture by a supplemental indenture in
circumstances where the consent of any Noteholder is required;
(d) the amendment of the Indenture by a supplemental indenture in
circumstances where the consent of any Noteholder is not required and such
amendment materially adversely affects the interest of the Certificateholders;
or
(e) the appointment pursuant to the Indenture of a successor Note
Registrar, Paying Agent or Indenture Trustee or pursuant to this Agreement of a
successor Certificate Registrar or Certificate Paying Agent, or the consent to
the assignment by the Note Registrar, the Paying Agent, the Indenture Trustee,
the Certificate Registrar or the Certificate Paying Agent of its obligations
under the Indenture or this Agreement, as applicable.
4.07 ACTION BY CERTIFICATEHOLDERS WITH RESPECT TO CERTAIN MATTERS. The
Owner Trustee shall not have the power, except upon the written direction of
Holders of Certificates representing at least a majority of the aggregate
Percentage Interest of each Class of Certificates, to (i) remove the Master
Servicer under the Sale and Servicing Agreement pursuant to Sections 3.01(c),
6.02 or 7.01 thereof or (ii) except as expressly provided in the Basic
Documents, sell the Mortgage Loans after the termination of the Indenture.
4.08 ACTION WITH RESPECT TO BANKRUPTCY.
(a) The Trust shall not, without the prior written consent of the Owner
Trustee, (i) institute any proceedings to adjudicate the Trust bankrupt or
insolvent, (ii) consent to the institution of bankruptcy or insolvency
proceedings against the Trust, (iii) file a petition seeking or consenting to
reorganization or relief under any applicable federal or state law relating to
bankruptcy with respect to the Trust, (iv) consent to the appointment of a
receiver, liquidator, assignee, trustee, sequestrator (or other similar
official) of the Trust or a substantial part of its property, (v) make any
assignment for the benefit of the Trust's creditors, (vi) cause the Trust to
admit in writing its inability to pay its debts generally as they become due, or
(vii) take any action in furtherance of any of the foregoing (any of the above
foregoing actions, a "Bankruptcy Action"). In considering whether to give or
withhold written consent to the Bankruptcy Action by the Trust, the Owner
Trustee, with the consent of the Certificateholder (hereby given, which consent
the Certificateholder believes to be in the best interests of the
Certificateholder and the Trust), shall consider the interest of the Noteholders
in addition to the interests of the Trust and whether the Trust is insolvent.
The Owner Trustee shall have no duty to give such written consent to Bankruptcy
Action by the Trust if the Owner Trustee shall not have been furnished (at the
expense of the Trust) or the Person that requested that such letter be furnished
to the Owner Trustee) a letter from an independent accounting firm of national
reputation stating that in the opinion of such firm the Trust is then insolvent.
The Owner Trustee (as such and in its individual capacity) shall not be
personally liable to any Person on account of the Owner Trustee's good faith
reliance on the provisions of this Section 4.08 or in connection with the Owner
Trustee's giving prior written consent to Bankruptcy Action by the Trust in
accordance herewith, or withholding such consent, in good faith, and neither the
Trust nor any Certificateholder nor any other Person shall have any claim for
breach of fiduciary duty or otherwise against the Owner Trustee (as such and in
its individual capacity) for giving or withholding its consent to any such
Bankruptcy Action.
(b) The parties hereto stipulate and agree that no Certificateholder has
power to commence any Bankruptcy Action on the part of the Trust or to direct
the Owner Trustee to take any Bankruptcy Action on the part of the Trust.
(c) The provisions of this Section 4.08 shall not constitute an
acknowledgment or admission by the Trust, the Owner Trustee, any
Certificateholder or any creditor of the Trust that the Trust is eligible to be
a debtor, under the United States Bankruptcy Code, 11 U.S.C. ▇▇.▇▇. 101 et seq.,
as amended.
4.09 RESTRICTIONS ON CERTIFICATEHOLDERS' POWER. The Certificateholders
shall not direct the Owner Trustee to take or to refrain from taking any action
if such action or inaction would be contrary to any obligation of the Trust or
the Owner Trustee under this Agreement or any other Basic Document or would be
contrary to Section 2.03, nor shall the Owner Trustee be obligated to follow any
such direction, if given.
4.10 DOING BUSINESS IN OTHER JURISDICTIONS. Notwithstanding anything
contained herein to the contrary, neither Wilmington Trust Company nor the Owner
Trustee shall be required to take any action in any jurisdiction other than in
the State of Delaware if the taking of such action will, even after the
appointment of a co-trustee or separate trustee in accordance with Section 9.05,
(i) require the consent or approval or authorization or order of or the giving
of notice to, or the registration with or the taking of any other action in
respect of, any state or other governmental authority or agency of any
jurisdiction other than the State of Delaware; (ii) result in any fee, tax or
other governmental charge under the laws of the State of Delaware becoming
payable by Wilmington Trust Company, or (iii) subject Wilmington Trust Company
to personal jurisdiction in any jurisdiction other than the State of Delaware
for causes of action arising from acts unrelated to the consummation of the
transactions by Wilmington Trust Company contemplated hereby.
4.11 MAJORITY CONTROL. Except as expressly provided herein, any action that
may be taken by the Certificateholders under this Agreement may be taken by
Holders of Certificates representing at least a majority of the aggregate
Percentage Interest of the Class specified, if any. Except as expressly provided
herein, any written notice of the Certificateholders of a Class delivered
pursuant to this Agreement shall be effective if signed by Certificateholders
evidencing at least a majority of the aggregate Percentage Interest of such
Class outstanding at the time of the delivery of such notice.
ARTICLE V
APPLICATION OF TRUST ESTATE
5.01 DISTRIBUTIONS.
(a) On each Payment Date, the Certificate Paying Agent shall distribute to
the Certificateholders all funds, if any, on deposit in the Trustee Collection
Account for distribution to the Certificateholders as a result of the
application of Section 3.05 of the Indenture. Any distributions made pursuant to
this Section to any Class of Certificates shall be distributed to the
Certificateholders of such Class pro rata based upon the respective Percentage
Interests thereof.
(b) In the event that any withholding tax is imposed on distributions (or
allocations of income) to a Certificateholder, such tax shall reduce the amount
otherwise distributable to such Certificateholder in accordance with this
Section. The Certificate Paying Agent is hereby authorized and directed to
retain or cause to be retained from amounts otherwise distributable to the
Certificateholders sufficient funds for the payment of any tax that is legally
owed by the Trust; provided, that such authorization shall not prevent the Owner
Trustee from contesting any such tax in appropriate Proceedings and withholding
payment thereof, if permitted by law, pending the outcome of such Proceedings.
The amount of any withholding tax imposed with respect to a Certificateholder
shall be treated as cash distributed to such Certificateholder at the time it is
withheld by the Certificate Paying Agent 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.
Certificateholder), the Certificate Paying Agent may in its sole discretion
withhold such amounts in accordance with this paragraph.
(c) Distributions to Certificateholders shall be subordinated to the
creditors of the Trust, including the Noteholders to the extent set forth in the
Basic Documents.
5.02 METHOD OF PAYMENT. Subject to Section 8.01(b), distributions required
to be made to Certificateholders on any Payment Date as provided in Section 5.01
shall be made to each Certificateholder of record on the preceding Record Date
either by, in the case of any Holder of a Certificate having a Percentage
Interest of at least 20%, wire transfer, in immediately available funds, to the
account of such Certificateholders at a bank or other entity having appropriate
facilities therefor, if such Certificateholder shall have provided to the
Certificate Registrar appropriate written instructions at least five Business
Days prior to such Payment Date or, if not, by check mailed to such
Certificateholder at the address thereof appearing in the Certificate Register.
5.03 SIGNATURE ON RETURNS. The Master Servicer, as agent of the tax matters
partner of the Trust (the "Tax Matters Person"), shall sign on behalf of the
Trust the tax returns of the Trust.
5.04 STATEMENTS TO CERTIFICATEHOLDERS. On each Payment Date (or promptly
after receipt if not received prior to the Payment Date), the Certificate Paying
Agent shall make available to each Certificateholder the statement or statements
provided to the Owner Trustee and the Certificate Paying Agent pursuant to
Section 4.01 of the Sale and Servicing Agreement with respect to such Payment
Date.
5.05 TAX REPORTING; TAX ELECTIONS. The Administrator hereby undertakes to
(i) prepare and deliver to the holders of the Certificates and the Non-Offered
Subordinate Notes within 90 days after the expiration of each fiscal year of the
Trust, all information returns required by the Code and information available to
the Administrator with respect to the Trust necessary for the preparation of
such holders' federal income tax returns, (ii) prepare all income tax returns of
the Trust in all jurisdictions where in its judgment such filings are required
or where it is directed by the Trust to file such income tax returns and (iii)
deliver such returns to the Owner Trustee not less than one week prior to their
due date in order for such returns to be timely filed. Pursuant to Treasury
Regulation 301.7701-2(c)(2), the Administrator does not intend to file any
income tax returns of the Trust as long as there is a single owner of the
Non-Offered Subordinate Notes. If partnership tax returns are required to be
filed, the Administrator shall not be required to compute the Issuer's gross
income except to the extent that it can do so without unreasonable effort based
upon income statements furnished to it. It is the intention of the parties that
no portion of the Trust be treated as a partnership for tax purposes unless
there is more than one holder of the Non-Offered Subordinate Notes. The
Administrator shall not be required to prepare any partnership tax returns
unless it receives an opinion of counsel that such returns are required by
applicable laws, rule or regulations to be filed.
The Administrator shall (i) act on behalf of the Trust in relation to any
tax matter or controversy involving the Trust and (ii) represent the Trust in
any Proceeding relating to tax examination or audit by any governmental taxing
authority with respect thereto. The legal expenses, including attorneys' and
accountants' fees, the costs of any such Proceeding and any liability resulting
therefrom shall be expenses of the Trust, and the Administrator shall be
entitled to reimbursement therefor from the Master Servicer out of amounts
attributable to the Mortgage Loans on deposit in the Collection Account as
provided by Section 3.04 of the Sale and Servicing Agreement, unless such legal
expenses and costs are incurred by reason of the Administrator's willful
misfeasance, bad faith or gross negligence.
ARTICLE VI
CONCERNING THE OWNER TRUSTEE
6.01 ACCEPTANCE OF TRUSTS AND DUTIES. The Owner Trustee accepts the trusts
hereby created and agrees to perform its duties hereunder with respect to such
trusts pursuant to the terms of this Agreement. The Owner Trustee and the
Certificate Paying Agent also agree to disburse all moneys actually received by
them constituting part of the Trust Estate pursuant to the terms of this
Agreement and the other Basic Documents. The Owner Trustee shall not be
answerable or accountable hereunder or under any other Basic Document under any
circumstance, except (i) for its own willful misconduct, gross negligence, bad
faith or grossly negligent failure to act or (ii) in the case of the inaccuracy
of any representation or warranty contained in Section 6.03 expressly made by
the Owner Trustee. In particular, without limitation and subject to the
exceptions set forth in the preceding sentence:
(a) no provision of this Agreement or any other Basic Document shall
require the Owner Trustee to expend or risk funds or otherwise incur any
financial liability in the performance of any of its rights, duties or powers
hereunder or under any other Basic Document, if the Owner Trustee shall have
reasonable grounds for believing that repayment of such funds or adequate
indemnity against such risk or liability is not reasonably assured or provided
to it;
(b) under no circumstances shall the Owner Trustee be liable for
indebtedness evidenced by or arising under any Basic Document, including the
principal of and interest on the Notes;
(c) the Owner Trustee shall not be responsible for the validity or
sufficiency of this Agreement, for the due execution hereof by the Depositor,
for the form, character, genuineness, sufficiency, value or validity of the
Trust Estate or for the validity or sufficiency of other Basic Documents, the
Notes or the Certificates (other than its certificate of authentication on the
Certificate), and the Owner Trustee shall not assume or incur any liability,
duty or obligation to any Noteholder or Certificateholder, other than as
expressly provided for herein or in the other Basic Documents;
(d) 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;
(e) the Owner Trustee shall not be liable for the default or misconduct of
the Depositor, the Indenture Trustee, the Administrator or the Master Servicer
under any Basic Document or otherwise, and the Owner Trustee shall have no
obligation or liability to perform the obligations of the Trust under this
Agreement or the other Basic Documents that are required to be performed by the
Indenture Trustee under the Indenture, the Seller or the Purchaser under the
Mortgage Loan Purchase and Servicing Agreement, the Administrator or the Master
Servicer under the Administration Agreement, or the Master Servicer or the
Depositor under the Sale and Servicing Agreement;
(f) the Owner Trustee shall be under no obligation to exercise any right or
power vested in it or duty imposed upon it by this Agreement, or to institute,
conduct or defend any litigation under this Agreement or otherwise or in
relation to this Agreement or any other Basic Document, at the request, order or
direction of any Certificateholder, unless such Certificateholder shall have
offered the Owner Trustee security or indemnity satisfactory to it against the
costs, expenses and liabilities that may be incurred by the Owner Trustee
therein or thereby. The right of the Owner Trustee to perform any discretionary
act enumerated in this Agreement or in any other Basic Document shall not be
construed as a duty, and the Owner Trustee shall not be answerable for other
than its gross negligence, bad faith or willful misconduct in the performance of
any such act; and
(g) In no event shall the Owner Trustee be liable for any act or omission
taken in accordance with the direction of the Certificateholders pursuant to
this Agreement.
6.02 FURNISHING OF DOCUMENTS. The Owner Trustee shall furnish to the
Certificateholders promptly upon receipt of a written reasonable request
therefor, duplicates or copies of all reports, notices, requests, demands,
certificates, financial statements and any other instruments furnished to the
Trust under the Basic Documents.
6.03 REPRESENTATIONS AND WARRANTIES. The Owner Trustee hereby represents
and warrants to the Depositor, for the benefit of the Certificateholders, that:
(a) it is a banking corporation duly organized and validly existing in good
standing under the laws of the State of Delaware. 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 terms or provisions hereof will contravene any federal or Delaware law,
governmental rule or regulation governing the banking or trust powers of the
Owner Trustee or any judgment or order binding on it, or constitute any default
under its charter documents or bylaws or any indenture, mortgage, contract,
agreement or instrument to which it is a party or by which any of its properties
may be bound;
(d) this Agreement, assuming due authorization, execution and delivery by
the Owner Trustee and the Depositor, constitutes a valid, legal and binding
obligation of the Owner Trustee, enforceable against it in accordance with the
terms hereof subject to applicable bankruptcy, insolvency, reorganization,
moratorium and other laws affecting the enforcement of creditors' rights
generally and to general principles of equity, regardless of whether such
enforcement is considered in a Proceeding in equity or at law;
(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 otherwise) 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 that would prohibit its entering
into this Agreement or performing its obligations under this Agreement.
6.04 RELIANCE; ADVICE OF COUNSEL.
(a) The Owner Trustee shall incur no liability to anyone in acting upon any
signature, instrument, notice, resolution, request, consent, order, certificate,
report, opinion, bond, or other document or paper believed by it to be genuine
and believed by it to be signed by the proper party or parties. The Owner
Trustee may accept a certified copy of a resolution of the board of directors or
other governing body of any corporate party as conclusive evidence that such
resolution has been duly adopted by such body and that the same is in full force
and effect. As to any fact or matter the method of determination of which is not
specifically prescribed herein, the Owner Trustee may for all purposes hereof
rely on a certificate, signed by the president or any vice president or by the
treasurer or other authorized officers of the relevant party, as to such fact or
matter and such certificate shall constitute full protection to the Owner
Trustee for any action taken or omitted to be taken by it in good faith in
reliance thereon.
(b) In the exercise or administration of the Trust hereunder and in the
performance of its duties and obligations under this Agreement or the other
Basic Documents, the Owner Trustee may (i) act directly or through its agents,
attorneys, custodians or nominees (including persons acting under a power of
attorney) 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,
attorneys, custodians or nominees (including persons acting under a power of
attorney) if such persons have been selected by the Owner Trustee with
reasonable care, and (ii) consult with counsel, accountants and other skilled
persons to be selected with reasonable care and employed by it at the expense of
the Trust. 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 other Basic Document.
6.05 NOT ACTING IN INDIVIDUAL CAPACITY. Except as provided in this Article,
in accepting the trusts hereby created, Wilmington Trust Company acts solely as
Owner Trustee hereunder and not in its individual capacity; and all Persons
having any claim against the Owner Trustee by reason of the transactions
contemplated by this Agreement or any other Basic Document shall look only to
the Trust Estate for payment or satisfaction thereof.
6.06 OWNER TRUSTEE NOT LIABLE FOR CERTIFICATES OR RELATED DOCUMENTS. The
recitals contained herein and in the Certificates (other than the signature of
the Owner Trustee on the Certificate) shall be taken as the statements of the
Depositor, and the Owner Trustee assumes no responsibility for the correctness
thereof. The Owner Trustee makes no representation as to the validity or
sufficiency of this Agreement, any other Basic Document or the Certificates
(other than the signature of the Owner Trustee on the Certificate) or the Notes.
The Owner Trustee shall at no time have any responsibility or liability with
respect to the sufficiency of the Trust Estate or its ability to generate the
payments to be distributed to Certificateholders under this Agreement or the
Noteholders under the Indenture, including the compliance by any Person with any
warranty or representation made under any Basic Document or in any related
document, the accuracy of any such warranty or representation or any action of
the Certificate Paying Agent, the Certificate Registrar or the Indenture Trustee
taken in the name of the Owner Trustee.
6.07 OWNER TRUSTEE MAY OWN CERTIFICATES AND NOTES. The Owner Trustee in its
individual or any other capacity may become the owner or pledgee of the
Certificates or Notes and may deal with the Depositor, the Certificate Paying
Agent, the Certificate Registrar, the Paying Agent, the Master Servicer and the
Indenture Trustee in transactions with the same rights as it would have if it
were not Owner Trustee.
ARTICLE VII
COMPENSATION OF OWNER TRUSTEE
7.01 OWNER TRUSTEE'S FEES AND EXPENSE. The Owner Trustee shall receive as
compensation for its services hereunder such fees as have been separately agreed
upon before the date hereof (such fees not to be paid out of the Trust Estate),
and the Owner Trustee shall be reimbursed for its reasonable expenses hereunder
and under the other Basic Documents, including the reasonable compensation,
expenses and disbursements of such agents, representatives, experts and counsel
as the Owner Trustee may reasonably employ in connection with the exercise and
performance of its rights and its duties hereunder and under the other Basic
Documents, which shall be payable as separately agreed upon on or before the
date hereof (but such fees shall not be payable out of the Trust Estate).
7.02 INDEMNIFICATION. The holders of a majority of the Percentage Interests
of the Certificates (collectively, the "Indemnifying Party") shall indemnify,
defend and hold harmless 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") that may at any time be imposed on, incurred by, or
asserted against the Owner Trustee or any Indemnified Party in any way relating
to or arising out of this Agreement, the other Basic Documents, the Trust
Estate, the administration of the Trust Estate or the action or inaction of the
Owner Trustee hereunder; provided, that:
(a) No Indemnifying Party shall be liable for or required to indemnify an
Indemnified Party from and against Expenses arising or resulting from the Owner
Trustee's willful misconduct, gross negligence or bad faith, or as a result of
any inaccuracy of a representation or warranty contained in Section 6.03
expressly made by the Owner Trustee in its individual capacity;
(b) with respect to any such claim, the Indemnified Party shall have given
the Indemnifying Party written notice thereof promptly after the Indemnified
Party shall have actual knowledge thereof;
(c) while maintaining control over its own defense, the Indemnifying Party
shall consult with the Indemnified Party in preparing such defense; and
(d) notwithstanding anything in this Agreement to the contrary, the
Indemnifying Party shall not be liable for settlement of any claim by an
Indemnified Party entered into without the prior consent of the Indemnifying
Party, which consent shall not be unreasonably withheld.
The indemnities contained in this Section shall survive the resignation or
termination of the Owner Trustee or the termination of this Agreement. In the
event of any Proceeding for which indemnity will be sought pursuant to this
Section, the Owner Trustee's choice of legal counsel, if other than the legal
counsel retained by the Owner Trustee in connection with the execution and
delivery of this Agreement, shall be subject to the approval of the Indemnifying
Party, which approval shall not be unreasonably withheld. In addition, upon
written notice to the Owner Trustee and, with the consent of the Owner Trustee,
which consent shall not be unreasonably withheld, the Indemnifying Party has the
right to assume the defense of any Proceeding against the Owner Trustee;
provided, however, that the Indemnifying Party shall not be entitled to control
the defense of any such claim if such claim involves a possible imposition of
criminal liability or penalty or a material civil penalty on such Indemnified
Party, a conflict of interest between such Indemnified party and the
Indemnifying Party or another indemnitee or the granting of material injunctive
relief against such indemnitee, and the Indemnified Party informs the
Indemnifying Party that it desires to be represented by separate counsel, in
which case the reasonable fees and expenses of such separate counsel shall be
borne by Indemnifying Party.
ARTICLE VIII
TERMINATION OF TRUST AGREEMENT
8.01 TERMINATION OF TRUST AGREEMENT.
(a) This Agreement (other than this Article) and the Trust shall terminate
and be of no further force or effect upon the final distribution of all moneys
or other property or proceeds of the Trust Estate in accordance with the terms
of the Indenture and this Agreement. The bankruptcy, liquidation, dissolution,
death or incapacity of any Certificateholder shall not (i) operate to terminate
this Agreement or the Trust, (ii) entitle such Certificateholders' legal
representatives or heirs to claim an accounting or to pursue any Proceeding for
a partition or winding up of all or any part of the Trust or the Trust Estate or
(iii) otherwise affect the rights, obligations and liabilities of the parties
hereto. Notwithstanding any other provision of this Agreement, in no event shall
the Trust continue beyond 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, living on the date hereof.
(b) Notice of any termination of the Trust, specifying the Payment Date
upon which the Certificateholders shall surrender their Certificates to the
Certificate Paying Agent for payment of the final distribution and cancellation,
shall be given by the Certificate Paying Agent by letter to the
Certificateholders mailed within five Business Days of receipt of notice of such
termination from the Owner Trustee, stating (i) the Payment Date upon or with
respect to which final payment of the Certificates shall be made upon
presentation and surrender of the Certificates at the office of the Certificate
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 presentation and surrender of the
Certificates at the office of the Certificate Paying Agent therein specified.
The Certificate Paying Agent shall give such notice to the Owner Trustee and the
Certificate Registrar at the time such notice is given to the
Certificateholders. Upon presentation and surrender of the Certificate, the
Certificate Paying Agent shall cause to be distributed to the Certificateholders
the amounts distributable on such Payment Date pursuant to Section 5.01.
In the event that all of the Certificateholders shall not have surrendered
their Certificates for cancellation within six months after the date specified
in the above-mentioned written notice, the Certificate Paying Agent shall give a
second written notice to the remaining Certificateholders to surrender their
Certificates for cancellation and receive the final distribution with respect
thereto. Subject to applicable laws with respect to escheat of funds, if within
one year following the Payment Date on which final payment of the Certificates
was to have been made pursuant to Section 5.01, the Certificates shall not have
been surrendered for cancellation, the Certificate Paying Agent may take
appropriate steps, or may appoint an agent to take appropriate steps, to contact
the Certificateholder concerning surrender of the Certificate, and the cost
thereof shall be paid out of the funds and other assets that shall remain
subject to this Agreement. Any funds remaining in the Trustee Collection Account
after exhaustion of such remedies and the payment of all amounts due the
Noteholders shall be distributed by the Certificate Paying Agent to the
Certificateholder of the majority of the Percentage Interest of the Certificates
of the Class with respect to which such amounts are due.
(c) Upon the winding up of the Trust and its termination, the Owner Trustee
shall cause the Certificate of Trust to be cancelled by filing a certificate of
cancellation with the Secretary of State in accordance with the provisions of
Section 3810(d) of the Statutory Trust Statute.
ARTICLE IX
SUCCESSOR OWNER TRUSTEES AND ADDITIONAL OWNER TRUSTEES
9.01 ELIGIBILITY REQUIREMENTS FOR OWNER TRUSTEE. The Owner Trustee shall at
all times (i) be a corporation satisfying the provisions of Section 3807(a) of
the Statutory Trust Statute, (ii) be authorized to exercise corporate trust
powers, (iii) have a combined capital and surplus of at least $50,000,000, (iv)
be subject to supervision or examination by federal or state authorities and (v)
have (or have a parent that has) long-term debt obligations rated at least "A"
by Moody's, Standard & Poor's or Fitch, if rated by Fitch. If such corporation
shall publish reports of condition at least annually pursuant to law or to the
requirements of the aforesaid supervising or examining authority, then for the
purpose of this Section, the combined capital and surplus of such corporation
shall be deemed to be its combined capital and surplus as set forth in its most
recent report of condition so published. In case at any time the Owner Trustee
shall cease to be eligible in accordance with the provisions of this Section,
the Owner Trustee shall resign immediately in the manner and with the effect
specified in Section 9.02.
9.02 REPLACEMENT OF OWNER TRUSTEE. The Owner Trustee may at any time resign
and be discharged from the trusts hereby created by giving 30 days prior written
notice thereof to the Indenture Trustee and the Depositor. Upon receiving such
notice of resignation, the Indenture Trustee shall promptly appoint a successor
Owner Trustee by written instrument in duplicate, one copy of which shall be
delivered to each of the resigning Owner Trustee and the successor Owner
Trustee. If no successor Owner Trustee shall have been so appointed and shall
have accepted such appointment within 30 days after the giving of such notice of
resignation, the resigning Owner Trustee may petition any court of competent
jurisdiction for the appointment of a successor Owner Trustee.
If at any time (i) the Owner Trustee shall cease to be eligible in
accordance with the provisions of Section 9.01 and shall fail to resign after
written request therefor of the Indenture Trustee, (ii) the Owner Trustee shall
be legally unable to act, (iii) the Owner Trustee shall be adjudged bankrupt or
insolvent, (iv) a receiver of the Owner Trustee or of its property shall be
appointed or (v) 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, in each case, the Indenture Trustee may
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 by written instrument
in duplicate, one copy of which shall be delivered to each of the outgoing Owner
Trustee and the successor Owner Trustee. If the Indenture Trustee is unable to
appoint a successor Owner Trustee within 60 days after any such direction, the
Indenture Trustee may petition any court of competent jurisdiction for the
appointment of a successor Owner Trustee.
Any resignation or removal of the Owner Trustee and appointment of a
successor Owner Trustee pursuant to this Section shall not become effective
until acceptance of appointment by such successor Owner Trustee pursuant to
Section 9.03.
9.03 SUCCESSOR OWNER TRUSTEE. Any successor Owner Trustee appointed
pursuant to Section 9.02 shall execute, acknowledge and deliver to the Indenture
Trustee, its predecessor Owner Trustee an instrument accepting such appointment
under this Agreement, and thereupon the resignation or removal of the
predecessor Owner Trustee shall become effective, and such successor Owner
Trustee, without any further act, deed or conveyance, shall become fully vested
with all 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 deliver to the successor Owner Trustee all
documents and monies held by it under this Agreement; and such predecessor Owner
Trustee shall execute and deliver such instruments and do such other things as
may reasonably be required for fully and certainly vesting and confirming in the
successor Owner Trustee all such rights, powers, duties and obligations.
No successor Owner Trustee shall accept appointment as provided in this
Section, unless at the time of such acceptance such successor Owner Trustee
shall be eligible pursuant to Section 9.01.
Upon acceptance of appointment by a successor Owner Trustee pursuant to
this Section, the Indenture Trustee shall mail notice thereof to the
Certificateholders and the Noteholders, the Rating Agencies. If the Indenture
Trustee shall fail to mail such notice within 10 days after acceptance of such
appointment by the successor Owner Trustee, the successor Owner Trustee shall
cause such notice to be mailed at the expense of the Indenture Trustee.
9.04 MERGER OR CONSOLIDATION OF OWNER TRUSTEE. Any Person into which the
Owner Trustee may be merged or converted or with which it may be consolidated,
or any Person resulting from any merger, conversion or consolidation to which
the Owner Trustee shall be a party, or any Person succeeding to all or
substantially all of the corporate trust business of the Owner Trustee, shall be
the successor of the Owner Trustee hereunder, without the execution or filing of
any instrument or any further act on the part of any party hereto, anything
herein to the contrary notwithstanding; provided, that such Person shall be
eligible pursuant to Section 9.01; and provided further, that the Owner Trustee
shall mail notice of such merger or consolidation to the Rating Agencies.
9.05 APPOINTMENT OF CO-TRUSTEE OR SEPARATE TRUSTEE. Notwithstanding any
other provisions of this Agreement, at any time, for the purpose of meeting any
legal requirements of any jurisdiction in which any part of the Trust Estate may
at the time be located, the Owner Trustee shall have the power and shall execute
and deliver all instruments to appoint one or more Persons to act as co-trustee,
jointly with the Owner Trustee, or as separate trustee or trustees, of all or
any part of the Trust Estate, and to vest in such Person, in such capacity, such
title to the Trust or any part thereof and, subject to the other provisions of
this Section, such powers, duties, obligations, rights and trusts as the Owner
Trustee may consider necessary or desirable. No co-trustee or separate trustee
under this Agreement shall be required to meet the terms of eligibility as a
successor Owner Trustee pursuant to Section 9.01, and no notice of the
appointment of any co-trustee or separate trustee shall be required pursuant to
Section 9.03.
Each separate trustee and co-trustee shall, to the extent permitted by law,
be appointed and act subject to the following provisions and conditions:
(a) all rights, powers, duties and obligations conferred or imposed upon
the Owner Trustee shall be conferred upon and exercised or performed by the
Owner Trustee and such separate trustee or co-trustee jointly (it being
understood that such separate trustee or co-trustee is not authorized to act
separately without the Owner Trustee joining in such act), except to the extent
that under any law of any jurisdiction in which any particular act or acts are
to be performed, the Owner Trustee shall be incompetent or unqualified to
perform such act or acts, in which event such rights, powers, duties and
obligations (including the holding of title to the Trust Estate or any portion
thereof in any such jurisdiction) shall be exercised and performed singly by
such separate trustee or co-trustee, but solely at the direction of the Owner
Trustee;
(b) no trustee under this Agreement shall be personally liable by reason of
any act or omission of any other trustee under this Agreement; and
(c) the Owner Trustee may at any time accept the resignation of or remove
any separate trustee or co-trustee.
Any notice, request or other writing given to the Owner Trustee shall be
deemed to have been given to each of the then separate trustees and co-trustees,
as effectively as if given to each of them. Every instrument appointing any
separate trustee or co-trustee shall refer to this Agreement and the conditions
of this Article. Each separate trustee and co-trustee, upon its acceptance of
the trusts conferred, shall be vested with the estates or property specified in
its instrument of appointment, either jointly with the Owner Trustee or
separately, as may be provided therein, subject to all provisions of this
Agreement, including every provision relating to the conduct or affecting the
liability of, or affording protection to, the Owner Trustee. Each such
instrument shall be filed with the Owner Trustee.
Any separate trustee or co-trustee may at any time appoint the Owner
Trustee as its agent or attorney-in-fact with full power and authority, to the
extent not prohibited by law, to do any lawful act under or in respect of this
Agreement on its behalf and in its name. If any separate trustee or co-trustee
shall die, become incapable of acting, resign or be removed, then all of its
estates, properties, rights, remedies and trusts shall vest in and be exercised
by the Owner Trustee to the extent permitted by law, without the appointment of
a new or successor co-trustee or separate trustee.
ARTICLE X
MISCELLANEOUS
10.01 AMENDMENTS.
(a) Subject to Section 2.11(c), this Agreement may be amended from time to
time by the parties hereto (i) to cure any ambiguity, correct any mistake or
supplement any provision of this Agreement that may be inconsistent with any
other provision of this Agreement, add any provision that provides additional
rights to the Certificateholders, deal with any matter not covered in this
Agreement (I.E., to give effect to the intent of the parties), or ensure that
the Trust and any portion thereof is not classified as an association (or a
publicly traded partnership) taxable as a corporation or as a taxable mortgage
pool for federal income tax purposes; provided, that (A) (i) such amendment will
not, in the good faith judgment of the parties thereto, materially and adversely
affect the interest of any Certificateholder or Noteholder, and (ii) an Opinion
of Counsel is delivered to the Owner Trustee to the effect that such amendment
will not materially and adversely affect the interest of any Certificateholder
or Noteholder and will not cause the Trust or any portion thereof to be treated
for federal income tax purposes as a corporation, a taxable mortgage pool or a
publicly traded partnership that is treated as a corporation or (B) to the
extent affected thereby, with the consent of the Holders of Notes evidencing not
less than a majority of the Note Balance of the Notes and, to the extent
affected thereby, the consent of the Holders of Certificates evidencing not less
than a majority of the Percentage Interests of the Certificates for the purpose
of adding any provisions to or changing in any manner or eliminating any of the
provisions of this Agreement or of modifying in any manner the rights of the
Noteholders or the Certificateholders; provided 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 Mortgage Loans or distributions that shall
be required to be made for the benefit of the Noteholders or the
Certificateholders without the consent of the Holders of each outstanding Note
or Certificate affected thereby, or (b) reduce the aforesaid percentage of the
Note Balance of the Notes and the Percentage Interests of the Certificates
required to consent to any such amendment, without the consent of the Holders of
all the outstanding Notes, the Holders of all outstanding Certificates.
(b) Promptly after the execution of any such amendment or consent, the
Owner Trustee shall furnish written notification of the substance of such
amendment or consent to each Certificateholder, any Noteholder affected thereby,
the Indenture Trustee and each of the Rating Agencies. It shall not be necessary
for the consent of the Certificateholder or Noteholder pursuant to this Section
to approve the particular form of any proposed amendment or consent, but it
shall be sufficient if such consent shall approve the substance thereof. The
manner of obtaining such consents (and any other consents of the
Certificateholder or Noteholder provided for in this Agreement or in any other
Basic Document) and of evidencing the authorization of the execution thereof by
the Certificateholder or Noteholder shall be subject to such reasonable
requirements as the Owner Trustee may prescribe from time to time.
(c) In connection with the execution of any amendment to any agreement
(other than this Agreement) to which the Trust may be a party, the Owner Trustee
shall be entitled to receive and conclusively rely upon an Opinion of Counsel to
the effect that such amendment is authorized or permitted by the documents
subject to such amendment and that all conditions precedent in the Basic
Documents for the execution and delivery thereof by the Trust or the Owner
Trustee, as the case may be, have been satisfied.
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.
10.02 NO LEGAL TITLE TO TRUST ESTATE. The Certificateholders shall not have
legal title to any part of the Trust Estate. The Certificateholders shall be
entitled to receive distributions with respect to their undivided beneficial
interest therein only in accordance with Articles V and VIII. No transfer, by
operation of law or otherwise, of any right, title or interest of the
Certificateholders to and in their ownership interest in the Trust Estate shall
operate to terminate this Agreement or the trusts hereunder, or entitle any
transferee to an accounting or to the transfer to it of legal title to any part
of the Trust Estate.
10.03 LIMITATIONS ON RIGHTS OF OTHERS. Subject to Sections 10.07 and 10.14,
the provisions of this Agreement are solely for the benefit of the Owner
Trustee, the Depositor, the Certificateholders and, to the extent expressly
provided herein, the Indenture Trustee and the Noteholders, and nothing in this
Agreement, whether express or implied, shall be construed to give to any other
Person any legal or equitable right, remedy or claim in or to the Trust Estate
or under or in respect of this Agreement or any covenants, conditions or
provisions contained herein.
10.04 NOTICES.
(a) Unless otherwise expressly specified or permitted by the terms hereof,
all notices shall be in writing, deemed to have been given upon receipt and
addressed to: if to (i) the Owner Trustee, its Corporate Trust Office; (ii) the
Depositor, to ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇,
Attention: Asset Backed Securities Group; (iii) ▇▇▇▇▇'▇, to ▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attention: Home Mortgage Loan Monitoring
Group; (iv) Standard & Poor's, to ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇,
Attention: Structured Finance Department MBS, (v) the Master Servicer, to ▇▇▇▇▇
Union Bank and Trust Company, ▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇,
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇, Esq. and ▇▇▇▇▇▇ ▇▇▇▇▇ (with a copy to ▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇ ▇▇▇▇▇▇▇ and ▇▇▇▇ ▇▇▇▇▇▇▇, Esq. at ▇▇▇▇▇ Home Equity Corporation, ▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇., ▇▇▇▇▇ ▇▇▇, ▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ 94583), or (vi) as to each of
the foregoing Persons, at such other address as shall be designated by such
Person in a written notice to each of the other foregoing Persons.
(b) Any notice required or permitted to be given to a Certificateholder
shall be given by first-class mail, postage prepaid, at the address of such
Certificateholder as shown in the Certificate Register. Any such notice so
mailed within the time prescribed in this Agreement shall be conclusively
presumed to have been duly given, whether or not the Certificateholder receives
such notice.
(c) A copy of any notice delivered to the Owner Trustee or the Issuer shall
also be delivered to the Depositor, the Master Servicer and the Indenture
Trustee.
10.05 SEVERABILITY OF PROVISIONS. If any one or more of the covenants,
agreements, provisions or terms of this Agreement (including any amendment
hereto) shall be for any reason whatsoever held invalid or unenforceable, then
such covenants, agreements, provisions or terms shall be deemed severable from
the remaining covenants, agreements, provisions and terms of this Agreement, as
the same may be amended, and shall in no way affect the validity or
enforceability of the other covenants, agreements, provisions or terms of this
Agreement or any amendment hereto or any Certificate, or the rights of any
Certificateholder.
10.06 COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which so executed and delivered shall be deemed to be an
original, but all of which counterparts shall together constitute but one and
the same instrument.
10.07 SUCCESSORS AND ASSIGNS. All covenants and agreements contained herein
shall be binding upon, and inure to the benefit of, the parties hereto, the
Certificateholders and their respective permitted successors and assigns. Any
request, notice, direction, consent, waiver or other instrument or action by a
Certificateholder shall bind the successors and assigns of such
Certificateholder.
10.08 NO PETITION. The Owner Trustee, by entering into this Agreement, and
each Certificateholder, by its acceptance of a Certificate, hereby covenants and
agrees that they will not at any time institute against the Depositor or the
Trust, or join in the institution against the Depositor or the Trust of, any
Proceeding under or in relation to any federal or state bankruptcy or similar
law in connection with any obligations with respect to the Certificate, the
Notes, this Agreement or any other Basic Document.
10.09 NO RECOURSE. Each Certificateholder, by its acceptance of a
Certificate, acknowledges that such Certificate represents a beneficial interest
in the Trust only, and does not represent an interest in or obligation of the
Depositor, the Owner Trustee, the Indenture Trustee or any Affiliate thereof,
and no recourse may be had against such Persons or their assets except as may be
expressly set forth or contemplated in the Certificate, this Agreement or the
other Basic Documents.
10.10 HEADINGS. The headings of the various Articles and Sections herein
are for convenience of reference only and shall not define or limit any term or
provision hereof.
10.11 GOVERNING LAW. THIS AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH
THE LAWS OF THE STATE OF DELAWARE, WITHOUT REFERENCE TO ITS CONFLICT OF LAW
PROVISIONS, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER
SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
10.12 INTEGRATION. This Agreement constitutes the entire agreement among
the parties hereto pertaining to the subject matter hereof, and supersedes all
prior agreements and understanding pertaining thereto.
10.13 CERTIFICATES NONASSESSABLE. The interests represented by the
Certificates shall be nonassessable for any loss of the Trust or for any reason
whatsoever.
* * *
IN WITNESS WHEREOF, the Depositor and the Owner Trustee have caused their
names to be signed hereto by their respective officers thereunto duly
authorized, all as of the day and year first above written.
BEAR ▇▇▇▇▇▇▇ ASSET BACKED
SECURITIES, INC.,
as Depositor
By: /S/ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Name: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Title: Senior Managing Director
WILMINGTON TRUST COMPANY,
not in its individual capacity but solely as
Owner Trustee, except with respect to the
representations and warranties contained in
Section 6.03
By: /S/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Senior Financial
Services Officer
Acknowledged and Agreed:
▇▇▇▇▇ FARGO BANK MINNESOTA,
NATIONAL ASSOCIATION,
as Indenture Trustee, Certificate Registrar
and Certificate Paying Agent
By: /S/ ▇▇▇▇▇ ▇▇▇▇▇▇
Name: ▇▇▇▇▇ ▇▇▇▇▇▇
Title: Assistant Vice
President
EXHIBIT A
FORM OF CERTIFICATE
THIS CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO THE NOTES, AS
DESCRIBED IN THE INDENTURE AND THE TRUST AGREEMENT.
THIS CERTIFICATE IS NOT TRANSFERABLE EXCEPT UPON SATISFACTION OF THE
CONDITIONS IN SECTION 3.04 OF THE TRUST AGREEMENT. THIS CERTIFICATE IS ISSUED IN
THE PERCENTAGE INTEREST SET FORTH BELOW.
THIS CERTIFICATE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR THE SECURITIES
LAWS OF ANY STATE, AND MAY NOT BE RESOLD OR TRANSFERRED UNLESS IT IS REGISTERED
PURSUANT TO THE SECURITIES ACT AND SUCH STATE LAWS, OR IS SOLD OR TRANSFERRED IN
TRANSACTIONS THAT ARE EXEMPT FROM REGISTRATION UNDER THE SECURITIES ACT AND SUCH
STATE LAWS AND IS TRANSFERRED IN ACCORDANCE WITH THE PROVISIONS OF SECTION 3.04
OF THE TRUST AGREEMENT.
NO TRANSFER OF THIS CERTIFICATE SHALL BE MADE UNLESS THE CERTIFICATE
REGISTRAR SHALL HAVE RECEIVED EITHER (I) A REPRESENTATION LETTER FROM THE
TRANSFEREE OF THIS CERTIFICATE TO THE EFFECT THAT SUCH TRANSFEREE IS NOT AN
EMPLOYEE BENEFIT PLAN SUBJECT TO THE PROHIBITED TRANSACTION RESTRICTIONS AND THE
FIDUCIARY RESPONSIBILITY REQUIREMENTS OF THE EMPLOYEE RETIREMENT INCOME SECURITY
ACT OF 1974, AS AMENDED ("ERISA"), SECTION 4975 OF THE INTERNAL REVENUE CODE OF
1986, AS AMENDED (THE "CODE") OR SUBSTANTIALLY SIMILAR RULES UNDER STATE, LOCAL
OR FEDERAL LAW ("SIMILAR LAW"), ANY PERSON ACTING, DIRECTLY OR INDIRECTLY, ON
BEHALF OF ANY SUCH PLAN OR ANY PERSON USING "PLAN ASSETS" WITHIN THE MEANING OF
THE DEPARTMENT OF LABOR REGULATION AT 29 C.F.R. ss. 2510.3-101 TO ACQUIRE THIS
CERTIFICATE (COLLECTIVELY A "PLAN INVESTOR"), OR (II) IF THIS CERTIFICATE IS
PRESENTED FOR REGISTRATION IN THE NAME OF A PLAN INVESTOR, AN OPINION OF
COUNSEL, OR A CERTIFICATION IN THE FORM OF EXHIBIT G TO THE TRUST AGREEMENT IN
LIEU OF SUCH OPINION OF COUNSEL, TO THE EFFECT THAT THE PURCHASE AND HOLDING OF
THIS CERTIFICATE IS PERMISSIBLE UNDER APPLICABLE LAW, WILL NOT CONSTITUTE OR
RESULT IN A PROHIBITED TRANSACTION UNDER SECTION 406 OF ERISA, SECTION 4975 OF
THE CODE OR SIMILAR LAW (OR COMPARABLE PROVISIONS OF ANY SUBSEQUENT ENACTMENTS)
AND WILL NOT SUBJECT THE DEPOSITOR, THE ISSUER, THE OWNER TRUSTEE OR THE
CERTIFICATE REGISTRAR TO ANY OBLIGATION OR LIABILITY IN ADDITION TO THOSE
UNDERTAKEN IN THE TRUST AGREEMENT.
THE TRANSFEREE OF THIS CERTIFICATE SHALL BE SUBJECT TO FEDERAL WITHHOLDING
TAX UNLESS THE CERTIFICATE REGISTRAR SHALL HAVE RECEIVED A CERTIFICATE OF
NON-FOREIGN STATUS CERTIFYING AS TO THE TRANSFEREE'S STATUS AS A UNITED STATES
PERSON UNDER UNITED STATES TAX LAW.
THIS CERTIFICATE DOES NOT REPRESENT AN INTEREST IN OR OBLIGATION OF THE
DEPOSITOR, THE ISSUER, THE MASTER SERVICER, THE OWNER TRUSTEE, THE INDENTURE
TRUSTEE OR ANY OF THEIR RESPECTIVE AFFILIATES, EXCEPT AS EXPRESSLY PROVIDED IN
THE TRUST AGREEMENT OR THE OTHER BASIC DOCUMENTS.
No. C-1
First Payment Date: September 25, 2003 Percentage Interest: ___%
HOME EQUITY LOAN-BACKED CERTIFICATE, SERIES 2003-C
evidencing a fractional undivided interest in ▇▇▇▇▇ Whole Loan Home Equity Trust
2003-C (the "Issuer"), the property of which consists primarily of the Mortgage
Loans.
This Certificate is payable solely from the Trust Estate, and does not
represent an obligation of or interest in the Depositor, the Issuer, the Owner
Trustee, the Indenture Trustee, the Master Servicer or any of their respective
Affiliates. This Certificate is not guaranteed or insured by any governmental
agency or instrumentality or by the Depositor, the Issuer, the Owner Trustee,
the Indenture Trustee, the Master Servicer or any of their respective
Affiliates. None of the Depositor, the Issuer, the Owner Trustee, the Indenture
Trustee, the Master Servicer or any of their respective Affiliates will have any
obligation with respect to any Certificate or other obligation secured by or
payable from payments on the Certificate.
This certifies that _____________________ is the registered owner of this
Certificate and in certain distributions with respect to the Trust Estate, which
consists primarily of the Mortgage Loans. The Trust is governed by a trust
agreement dated as of August 1, 2003 (the "Trust Agreement"), between the
Depositor and Wilmington Trust Company, as owner trustee (the "Owner Trustee"),
a summary of certain of the pertinent provisions of which is set forth below.
Capitalized terms used herein that are not otherwise defined shall have the
meanings ascribed thereto in Appendix A to the indenture dated as of August 1,
2003 (the "Indenture"), between the Trust and the Indenture Trustee. This
Certificate is issued under and is subject to the terms, provisions and
conditions of the Trust Agreement, to which the Holder of this Certificate by
virtue of the acceptance hereof assents, and by which such Certificateholder is
bound.
Pursuant to the terms of the Trust Agreement, a distribution will be made
on the 25th day of each month or, if such day is not a Business Day, the
immediately succeeding Business Day (each, a "Payment Date"), commencing in
September 2003, to the Person in the name of which this Certificate is
registered at the close of business on the last day (or if such day is not a
Business Day, the immediately preceding Business Day) of the month immediately
preceding the month of such distribution (each, a "Record Date") in an amount
equal to the pro rata portion evidenced by this Certificate (based on the
Percentage Interest stated on the face hereon), of the amount, if any, required
to be distributed to the Certificateholders on such Payment Date. Distributions
on this Certificate will be made as provided in the Trust Agreement by the
Certificate Paying Agent by wire transfer or check mailed to the
Certificateholders of record in the Certificate Register without the
presentation or surrender of this Certificate or the making of any notation
hereon.
Except as otherwise provided in the Trust Agreement and notwithstanding the
above, the final distribution on this Certificate will be made after due notice
by the Certificate Paying Agent of the pendency of such distribution and only
upon presentation and surrender of this Certificate at the office or agency
maintained by the Certificate Registrar for such purpose in Minneapolis,
Minnesota.
No transfer of this Certificate may be made unless such transfer is exempt
from the registration requirements of the Securities Act and any applicable
state securities laws, or is made in accordance with the Securities Act and such
state laws. In the event such a transfer is to be made, (i) the Certificate
Registrar or the Issuer may require an Opinion of Counsel acceptable to and in
form and substance satisfactory to the Certificate Registrar and the Issuer that
such transfer is exempt from (describing the applicable exemption and the basis
therefor) or is being made pursuant to the registration requirements of the
Securities Act and any applicable state securities laws, (ii) the transferee
shall execute an investment letter in the form described in the Trust Agreement
and (iii) the Certificate Registrar shall require the transferee to execute an
investment letter and a Certificate of Non-Foreign Status in the form described
by the Trust Agreement (or if a Certificate of Non-Foreign Status is not
provided, an Opinion of Counsel as described in the Trust Agreement), which
investment letter and certificate or Opinion of Counsel shall not be an expense
of the Depositor, the Trust, the Owner Trustee or the Certificate Registrar. The
Holder hereof desiring to effect such transfer shall, and does hereby agree to,
indemnify the Depositor, the Trust, the Owner Trustee and the Certificate
Registrar against any liability that may result if such transfer is not so
exempt or is not made in accordance with such federal and state laws. In
connection with any such transfer, the Certificate Registrar (unless otherwise
directed by the Issuer) will also require either (i) a representation letter, in
the form as described by the Trust Agreement, stating that the related
transferee is not an employee benefit or other plan subject to the prohibited
transaction restrictions or the fiduciary responsibility requirements of ERISA,
Section 4975 of the Code or substantially similar rules of state, local or
federal law ("Similar Law") (any of the foregoing, a "Plan"), any Person acting,
directly or indirectly, on behalf of any such Plan or any person using the "plan
assets" within the meaning of the Department of Labor regulations at 29 C.F.R.
ss. 2510.3-101, to effect such acquisition (each, a "Plan Investor") or (ii) if
such transferee is a Plan Investor, an Opinion of Counsel acceptable to and in
form and substance satisfactory to the Depositor, the Owner Trustee and the
Certificate Registrar, or a certification in the form of Exhibit G to the Trust
Agreement, to the effect that the purchase and holding of the related
Certificate is permissible under applicable law, will not constitute or result
in a prohibited transaction under Section 406 of ERISA, Section 4975 of the Code
or Similar Law (or comparable provisions of any subsequent enactments) and will
not subject the Depositor, the Issuer, the Owner Trustee or the Certificate
Registrar to any obligation or liability in addition to those undertaken in the
Trust Agreement.
Each Certificateholder, by its acceptance of a Certificate, agrees that it
will look solely to funds on deposit in the Trustee Collection Account that have
been released from the Lien of the Indenture for payment hereunder, and that the
Owner Trustee in its individual capacity is not personally liable to any
Certificateholder for any amount payable under any Certificate or the Trust
Agreement or, except as expressly provided in the Trust Agreement, subject to
any liability under the Trust Agreement.
The Holder of this Certificate acknowledges and agrees that its rights to
receive distributions in respect of this Certificate are subordinated to the
rights of the Noteholders as described in the Indenture.
Each Certificateholder, by its acceptance of a Certificate, covenants and
agrees that such Certificateholder will not at any time institute against the
Depositor or the Issuer, or join in any institution against the Depositor or the
Issuer of, any bankruptcy, reorganization, arrangement, insolvency or
liquidation Proceedings, or other Proceedings under any federal or state
bankruptcy or similar law in connection with any obligations relating to the
Certificates, the Notes, the Trust Agreement or any other Basic Document.
Each Certificateholder, by its acceptance of a Certificate, covenants and
agrees that it will treat the Non-Offered Subordinate Notes, as representing the
sole classes of equity of the Issuer, and the Certificates, as representing a
noneconomic interest in the Issuer, for federal, state and local income, single
business and franchise tax purposes.
The Trust Agreement permits the amendment thereof from time to time in
accordance with Section 10.01 of the Trust Agreement.
As provided in the Trust Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registerable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the offices or agencies of the Certificate Registrar maintained in
Minneapolis, Minnesota, accompanied by a written instrument of transfer in form
satisfactory to the Certificate Registrar duly executed by the Holder hereof or
such Certificateholder's attorney duly authorized in writing, and thereupon one
or more new Certificates of authorized denominations evidencing a like aggregate
Percentage Interest will be issued to the designated transferee. The initial
Certificate Registrar appointed under the Trust Agreement is the Indenture
Trustee.
Except as provided in the Trust Agreement, the Certificates are issuable
only in minimum denominations of a 5.0000% Percentage Interest and in integral
multiples of a 5.0000% Percentage Interest in excess thereof. As provided in the
Trust Agreement and subject to certain limitations set forth therein, the
Certificates are exchangeable for new Certificates of authorized denominations,
as requested by the Certificateholder surrendering the same. This Certificate is
issued in the Percentage Interest set forth above.
No service charge will be made for any such registration of transfer or
exchange, but the Owner Trustee or the Certificate Registrar may require payment
of a sum sufficient to cover any tax or governmental charge payable in
connection therewith.
The Owner Trustee, the Certificate Paying Agent, the Certificate Registrar
and any agent of the foregoing may treat the Person in the name of which this
Certificate is registered as the owner hereof for all purposes, and none of the
Owner Trustee, the Certificate Paying Agent, the Certificate Registrar or any
such agent shall be affected by any notice to the contrary.
This Certificate shall be governed by and construed in accordance with the
laws of the State of Delaware.
The Trust Agreement (other than Article VIII thereof) and the Trust shall
terminate and be of no further force or effect upon the final distribution of
all moneys or other property or proceeds of the Trust Estate in accordance with
the terms of the Indenture and the Trust Agreement. The bankruptcy, liquidation,
dissolution, death or incapacity of any Certificateholder shall not (i) operate
to terminate the Trust Agreement or the Trust, (ii) entitle such
Certificateholder's legal representatives or heirs to claim an accounting or to
pursue any Proceeding for a partition or winding up of all or any part of the
Trust or the Trust Estate or (iii) otherwise affect the rights, obligations and
liabilities of the parties thereto. Notwithstanding any other provision of the
Trust Agreement, in no event will the Trust continue beyond 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,
living on the date of the Trust Agreement.
Unless the certificate of authentication hereon shall have been executed by
an authorized officer of the Owner Trustee, or an authenticating agent by manual
signature, this Certificate shall not be entitled to any benefit under the Trust
Agreement or be valid for any purpose.
IN WITNESS WHEREOF, the Owner Trustee, on behalf of the Trust and not in
its individual capacity, has caused this Certificate to be duly executed.
▇▇▇▇▇ WHOLE LOAN HOME EQUITY
TRUST 2003-C
By: WILMINGTON TRUST COMPANY, not in
its individual capacity but solely
as Owner Trustee
Dated: ______ ______ By: ___________________________________
Authorized Signatory
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned Trust
Agreement.
WILMINGTON TRUST COMPANY,
not in its individual capacity
but solely as Owner Trustee
By: ____________________________
Authorized Signatory
or _____________________________
as Authenticating Agent of the Trust
By: ____________________________
Authorized Signatory
ASSIGNMENT
FOR VALUE RECEIVED the undersigned hereby sells, assigns and transfers unto
PLEASE INSERT SOCIAL SECURITY OR
OTHER IDENTIFYING NUMBER OF ASSIGNEE
(Please print or type name and address, including postal zip code, of assignee)
the within Certificate, and all rights thereunder, hereby irrevocably
constituting and appointing
to transfer such Certificate on the books of the Certificate Registrar, with
full power of substitution in the premises.
Dated:
_______________________________*/
Signature Guaranteed:
_______________________________*/
*_/ NOTICE: The signature to this assignment must correspond with the name
as it appears upon the face of the within Certificate in every particular,
without alteration, enlargement or any change whatsoever. Such signature must be
guaranteed by a member firm of the New York Stock Exchange or a commercial bank
or trust company.
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for the information of the
Certificate Paying Agent:
Distribution shall be made by wire transfer in immediately available funds
to _______ for the account of _________, account number ____________, or, if
mailed by check, to _______________.
Applicable statements should be mailed to _________________.
By: ________________________________________
Signature of assignee or agent
(for authorization of wire transfer only)
EXHIBIT B
CERTIFICATE OF TRUST
OF
▇▇▇▇▇ WHOLE LOAN HOME EQUITY TRUST 2003-C
The undersigned, as trustee (the "Owner Trustee"), for the purpose of
forming a statutory trust, pursuant to the provisions of the Delaware Statutory
Trust Act, 12 Del. C.ss.3801 et seq., as amended, does hereby certify as
follows:
1. The name of the statutory trust hereby created (the "Trust") is ▇▇▇▇▇
Whole Loan Home Equity Trust 2003-C.
2. The name and business address of the Owner Trustee in the State of
Delaware is Wilmington Trust Company, ▇▇▇▇▇▇ Square North, ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇.
3. This Certificate of Trust shall be effective August [13], 2003.
WILMINGTON TRUST COMPANY,
not in its individual capacity but
solely as Owner Trustee
By: ________________________________
Name:
Title:
EXHIBIT C
FORM OF RULE 144A INVESTMENT REPRESENTATION
Description of Rule 144A Securities, including numbers:
______
______
______
The undersigned seller, as registered holder (the "Seller"), intends to
transfer the Rule 144A Securities described above to the undersigned buyer (the
"Buyer").
1. In connection with such transfer and in accordance with the agreements
pursuant to which the Rule 144A Securities were issued, the Seller hereby
certifies the following facts: Neither the Seller nor anyone acting on its
behalf has offered, transferred, pledged, sold or otherwise disposed of the Rule
144A Securities, any interest in the Rule 144A Securities or any other similar
security to, or solicited any offer to buy or accept a transfer, pledge or other
disposition of the Rule 144A Securities, any interest in the Rule 144A
Securities or any other similar security from, or otherwise approached or
negotiated with respect to the Rule 144A Securities, any interest in the Rule
144A Securities or any other similar security with, any person in any manner, or
made any general solicitation by means of general advertising or in any other
manner, or taken any other action, that would constitute a distribution of the
Rule 144A Securities under the Securities Act of 1933, as amended (the
"Securities Act"), or that would render the disposition of the Rule 144A
Securities a violation of Section 5 of the Securities Act or require
registration pursuant thereto, and that the Seller has not offered the Rule 144A
Securities to any person other than the Buyer or another "qualified
institutional buyer" as defined in Rule 144A under the Securities Act.
2. The Buyer warrants and represents to, and covenants with, the Owner Trustee
and the Depositor, in each case as defined in the trust agreement dated as of
August 1, 2003 (the "Trust Agreement"), between Bear ▇▇▇▇▇▇▇ Asset Backed
Securities, Inc., as Depositor, and Wilmington Trust Company, as Owner Trustee,
as follows:
(a) The Buyer understands that the Rule 144A Securities have not been
registered under the Securities Act or the securities laws of any state.
(b) The Buyer considers itself a substantial, sophisticated institutional
investor having such knowledge and experience in financial and business matters
that it is capable of evaluating the merits and risks of investment in the Rule
144A Securities.
(c) The Buyer has been furnished with all information regarding the Rule
144A Securities that it has requested from the Seller, the Indenture Trustee,
the Owner Trustee or the Master Servicer.
(d) Neither the Buyer nor anyone acting on its behalf has offered,
transferred, pledged, sold or otherwise disposed of the Rule 144A Securities,
any interest in the Rule 144A Securities or any other similar security to, or
solicited any offer to buy or accept a transfer, pledge or other disposition of
the Rule 144A Securities, any interest in the Rule 144A Securities or any other
similar security from, or otherwise approached or negotiated with respect to the
Rule 144A Securities, any interest in the Rule 144A Securities or any other
similar security with, any person in any manner, or made any general
solicitation by means of general advertising or in any other manner, or taken
any other action, that would constitute a distribution of the Rule 144A
Securities under the Securities Act or that would render the disposition of the
Rule 144A Securities a violation of Section 5 of the Securities Act or require
registration pursuant thereto, nor will it act, nor has it authorized or will it
authorize any person to act, in such manner with respect to the Rule 144A
Securities.
(e) The Buyer is a "qualified institutional buyer" as that term is defined
in Rule 144A under the Securities Act and has completed either of the forms of
certification to that effect attached hereto as Annex 1 or Annex 2. The Buyer is
aware that the sale to it is being made in reliance on Rule 144A. The Buyer is
acquiring the Rule 144A Securities for its own account or the accounts of other
qualified institutional buyers, understands that such Rule 144A Securities may
be resold, pledged or transferred only (i) to a person reasonably believed to be
a qualified institutional buyer that purchases for its own account or for the
account of a qualified institutional buyer to which notice is given that the
resale, pledge or transfer is being made in reliance on Rule 144A, or (ii)
pursuant to another exemption from registration under the Securities Act.
3. The Buyer represents that:
(i) either (a) or (b) is satisfied, as marked below:
_____ a. The Buyer is not any employee benefit plan subject to the
prohibited transaction restrictions and the fiduciary responsibility
requirements of the Employee Retirement Income Security Act of 1974, as amended
("ERISA"), the Internal Revenue Code of 1986, as amended (the "Code") or
substantially similar rules under state, local or federal law ("Similar Law"), a
Person acting, directly or indirectly, on behalf of any such plan or any Person
acquiring such Certificate with "plan assets" within the meaning of the
Department of Labor regulation promulgated at 29 C.F.R.ss.2510.3-101; or
_____ b. The Buyer will provide the Depositor, the Owner Trustee and the
Certificate Registrar with either: (A) an opinion of counsel, satisfactory to
the Depositor, the Owner Trustee and the Certificate Registrar, to the effect
that the purchase and holding of a Certificate by or on behalf of the Buyer is
permissible under applicable law, will not constitute or result in a prohibited
transaction under ERISA, Section 4975 of the Code or Similar Law (or comparable
provisions of any subsequent enactments) and will not subject the Depositor, the
Owner Trustee or the Certificate Registrar to any obligation or liability
(including liabilities under ERISA, Section 4975 of the Code or Similar Law) in
addition to those undertaken in the Trust Agreement, which opinion of counsel
shall not be an expense of the Depositor, the Owner Trustee or the Certificate
Registrar; or (B) in lieu of such opinion of counsel, a certification in the
form of Exhibit G to the Trust Agreement upon which the Depositor, the Owner
Trustee and the Certificate Registrar may rely without further inquiry or
investigation; and
(ii) the Buyer is familiar with the prohibited transaction
restrictions and fiduciary responsibility requirements of ERISA, Section
4975 of the Code and Similar Law and understands that each of the parties
to which this certification is made is relying and will continue to rely on
the statements made in this paragraph.
4. This document may be executed in one or more counterparts and by the
different parties hereto on separate counterparts, each of which, when so
executed, shall be deemed to be an original; such counterparts, together, shall
constitute one and the same document.
IN WITNESS WHEREOF, each of the parties has executed this document as of
the date set forth below.
__________________________________ __________________________________
Print Name of Seller Print Name of Buyer
By: ______________________________ By:_______________________________
Name: Name:
Title: Title:
Taxpayer Identification: Taxpayer Identification:
No. ______________________________ No. ______________________________
Date: _____________________________ Date: ____________________________
ANNEX 1 TO EXHIBIT C
QUALIFIED INSTITUTIONAL BUYER STATUS UNDER SEC RULE 144
(For Buyers Other Than Registered Investment Companies)
The undersigned hereby certifies as follows in connection with the Rule
144A Investment Representation to which this Certification is attached:
1. As indicated below, the undersigned is the President, Chief Financial
Officer, Senior Vice President or other executive officer of the Buyer.
2. In connection with purchases by the Buyer, the Buyer is a "qualified
institutional buyer" as that term is defined in Rule 144A under the Securities
Act of 1933, as amended ("Rule 144A"), because (i) the Buyer owned and/or
invested on a discretionary basis $_________1 in securities (except for the
excluded securities referred to below) as of the end of the Buyer's most recent
fiscal year (such amount being calculated in accordance with Rule 144A) and (ii)
the Buyer satisfies the criteria in the category marked below.
____________
1 Buyer must own and/or invest on a discretionary basis at least $100,000,000
in securities unless Buyer is a dealer, and, in that case, Buyer must own
and/or invest on a discretionary basis at least $10,000,000 in securities.
________________________________________________________________________________
___ CORPORATION, ETC. The Buyer is a corporation (other than a bank, savings
and loan association or similar institution), Massachusetts or similar
statutory trust, partnership, or charitable organization described in
Section 501(c)(3) of the Internal Revenue Code.
________________________________________________________________________________
___ BANK. The Buyer (i) is a national bank or banking institution organized
under the laws of any state, territory or the District of Columbia, the
business of which is substantially confined to banking and is supervised by
the State or territorial banking commission or similar official or is a
foreign bank or equivalent institution, and (ii) has an audited net worth
of at least $25,000,000 as demonstrated in its latest annual financial
statements, a copy of which is attached hereto.
________________________________________________________________________________
___ SAVINGS AND LOAN. The Buyer (i) is a savings and loan association, building
and loan association, cooperative bank, homestead association or similar
institution that is supervised and examined by a state or federal authority
having supervision over any such institutions or is a foreign savings and
loan association or equivalent institution and (ii) has an audited net
worth of at least $25,000,000 as demonstrated in its latest annual
financial statements.
________________________________________________________________________________
___ BROKER-DEALER. The Buyer is a dealer registered pursuant to Section 15 of
the Securities Exchange Act of ------------- 1934, as amended.
________________________________________________________________________________
___ INSURANCE COMPANY. The Buyer is an insurance company the primary and
predominant business activity of which is the writing of insurance or the
reinsuring of risks underwritten by insurance companies and that is subject
to supervision by the insurance commissioner or a similar official or
agency of a state or territory or the District of Columbia.
________________________________________________________________________________
___ STATE OR LOCAL PLAN. The Buyer is a plan established and maintained by a
state, its political subdivisions, or any agency or instrumentality of such
state or its political subdivisions, for the benefit of its employees.
________________________________________________________________________________
___ ERISA PLAN. The Buyer is an employee benefit plan within the meaning of
Title I of the Employee Retirement Income Security Act of 1974, as amended.
________________________________________________________________________________
___ INVESTMENT ADVISER. The Buyer is an investment adviser registered under the
Investment Advisers Act of 1940, as amended.
________________________________________________________________________________
___ SBIC. The Buyer is 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, as amended.
________________________________________________________________________________
___ BUSINESS DEVELOPMENT COMPANY. The Buyer is a business development company
as defined in Section 202(a)(22) of the Investment Advisers Act of 1940, as
amended.
________________________________________________________________________________
___ TRUST FUND. The Buyer is a trust fund the trustee of which is a bank or
trust company and the participants of which are exclusively (a) plans
established and maintained by a state, its political subdivisions, or any
agency or instrumentality of such state or its political subdivisions, for
the benefit of its employees, [or Co)] employee benefit plans within the
meaning of Title I of the Employee Retirement Income Security Act of 1974,
as amended, but is not a trust fund that includes as participants
individual retirement accounts or H.R. 10 plans. ---------
________________________________________________________________________________
3. The term "securities" as used herein does not include (i) securities of
issuers that are affiliated with the Buyer, (ii) securities that are part of an
unsold allotment to or subscription by the Buyer, if the Buyer is a dealer,
(iii) bank deposit notes and certificates of deposit, (iv) loan participations,
(v) repurchase agreements, (vi) securities owned but subject to a repurchase
agreement or (vii) currency, interest rate and commodity swaps.
4. For purposes of determining the aggregate amount of securities owned and/or
invested on a discretionary basis by the Buyer, the Buyer used the cost of such
securities to the Buyer and did not include any of the securities referred to in
the preceding paragraph. Further, in determining such aggregate amount, the
Buyer may have included securities owned by subsidiaries of the Buyer, but only
if such subsidiaries are consolidated with the Buyer in its financial statements
prepared in accordance with generally accepted accounting principles and if the
investments of such subsidiaries are managed under the Buyer's direction.
However, such securities were not included if the Buyer is a majority-owned,
consolidated subsidiary of another enterprise and the Buyer is not itself a
reporting company under the Securities Exchange Act of 1934, as amended.
5. The Buyer, acknowledges that it is familiar with Rule 144A and understands
that the Seller and other parties related to the Rule 144A Securities are
relying and will continue to rely on the statements made herein because one or
more sales to the Buyer may be in reliance on Rule 144A.
___ ___ Will the Buyer be purchasing the Rule 144A
Yes No Securities only for the Buyer's own account?
6. If the answer to the foregoing question is "no", the Buyer agrees that, in
connection with any purchase of securities sold to the Buyer for the account of
a third party (including any separate account) in reliance on Rule 144A, the
Buyer will only purchase for the account of a third party that at the time is a
"qualified institutional buyer" within the meaning of Rule 144A. In addition,
the Buyer agrees that the Buyer will not purchase securities for a third party
unless the Buyer has obtained a current representation letter from such third
party or taken other appropriate steps contemplated by Rule 144A to conclude
that such third party independently meets the definition of "qualified
institutional buyer" set forth in Rule 144A.
7. The Buyer will notify each of the parties to which this certification is made
of any changes in the information and conclusions herein. Until such notice is
given, the Buyer's purchase of Rule 144A Securities will constitute a
reaffirmation of this certification as of the date of such purchase.
________________________________________
Print Name of Buyer
By:_____________________________________
Name:
Title:
Date:__________
ANNEX 2 TO EXHIBIT C
QUALIFIED INSTITUTIONAL BUYER STATUS UNDER SEC RULE 144A
For Buyers That Are Registered Investment Companies
The undersigned hereby certifies as follows in connection with the
Rule 144A Investment Representation to which this Certification is
attached:
1. As indicated below, the undersigned is the President, Chief Financial Officer
or Senior Vice President of the Buyer or, if the Buyer is a "qualified
institutional buyer" as that term is defined in Rule 144A under the Securities
Act of 1933, as amended ("Rule 144A"), because Buyer is part of a Family of
Investment Companies (as defined below), is such an officer of the Adviser.
2. In connection with purchases by Buyer, the Buyer is a "qualified
institutional buyer" as defined in SEC Rule 144A because (i) the Buyer is an
investment company registered under the Investment Company Act of 1940, as
amended, and (ii) as marked below, the Buyer alone, or the Buyer's Family of
Investment Companies, owned at least $100,000,000 in securities (other than the
excluded securities referred to below) as of the end of the Buyer's most recent
fiscal year. For purposes of determining the amount of securities owned by the
Buyer or the Buyer's Family of Investment Companies, the cost of such securities
was used.
___ The Buyer owned $_____________ in securities (other than the excluded
securities referred to below) as of the end of the Buyer's most recent fiscal
year (such amount being calculated in accordance with Rule 144A).
___ The Buyer is part of a Family of Investment Companies that owned in the
aggregate $_____________ in securities (other than the excluded securities
referred to below) as of the end of the Buyer's most recent fiscal year (such
amount being calculated in accordance with Rule 144A).
3. The term "Family of Investment Companies" as used herein means two or more
registered investment companies (or series thereof) that have the same
investment adviser or investment advisers that are affiliated (by virtue of
being majority-owned subsidiaries of the same parent or because one investment
adviser is a majority owned subsidiary of the other).
4. The term "securities" as used herein does not include (i) securities of
issuers that are affiliated with the Buyer or are part of the Buyer's Family of
Investment Companies, (ii) bank deposit notes and certificates of deposit, (iii)
loan participations, (iv) repurchase agreements, (v) securities owned but
subject to a repurchase agreement and (vi) currency, interest rate and commodity
swaps.
5. The Buyer is familiar with Rule 144A and understands that each of the parties
to which this certification is made are relying and will continue to rely on the
statements made herein because one or more sales to the Buyer will be in
reliance on Rule 144A. In addition, the Buyer will only purchase for the Buyer's
own account.
6. The undersigned will notify each of the parties to which this certification
is made of any changes in the information and conclusions herein. Until such
notice, the Buyer's purchase of Rule 144A Securities will constitute a
reaffirmation of this certification by the undersigned as of the date of such
purchase.
_________________________________________
Print Name of Buyer
By:______________________________________
Name:
Title:
IF AN ADVISER:
_________________________________________
Print Name of Buyer
By:______________________________________
Name:
Title:
Date:____________________________________
EXHIBIT D
FORM OF INVESTOR REPRESENTATION LETTER
_________, ____
Bear ▇▇▇▇▇▇▇ Asset Backed Securities, Inc.
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇▇ Fargo Bank Minnesota, National Association
as Certificate Registrar
▇▇▇▇▇ Fargo Center
Sixth and Marquette
▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Corporate Trust Administration
Re: Home Equity Loan Backed Certificate,
Series 2003-C
Ladies and Gentlemen:
___________________ (the "Purchaser") intends to purchase from __________(the
"Seller") a __% Percentage Interest of Home Equity Loan-Backed Certificates,
Series 2003-C (the "Certificate"), issued pursuant to the trust agreement dated
as of August 1, 2003 (the "Trust Agreement"), between Bear ▇▇▇▇▇▇▇ Asset Backed
Securities, Inc., as depositor (the "Depositor") and Wilmington Trust Company,
as owner trustee (the "Owner Trustee"), as acknowledged and agreed by ▇▇▇▇▇
Fargo Bank Minnesota, National Association, as Certificate Registrar. All terms
used herein and not otherwise defined shall have the meanings set forth in the
Trust Agreement. The Purchaser hereby certifies, represents and warrants to, and
covenants with, the Issuer and the Certificate Registrar that:
1. The Purchaser understands that (a) the Certificate has not been and will not
be registered or qualified under the Securities Act of 1933, as amended (the
"Act") or any state securities law, (b) the Issuer is not required to so
register or qualify the Certificate, (c) the Certificate may be resold only if
registered and qualified pursuant to the provisions of the Act or any state
securities law, or if an exemption from such registration and qualification is
available, (d) the Trust Agreement contains restrictions regarding the transfer
of the Certificate and (e) the Certificate will bear a legend to the foregoing
effect.
2. The Purchaser is acquiring the Certificate for its own account for investment
only and not with a view to or for sale in connection with any distribution
thereof in any manner that would violate the Act or any applicable state
securities laws.
3. The Purchaser is (a) a substantial, sophisticated institutional investor
having such knowledge and experience in financial and business matters, and, in
particular, in such matters related to securities similar to the Certificate,
such that it is capable of evaluating the merits and risks of investment in the
Certificate, (b) able to bear the economic risks of such an investment and (c)
an "accredited investor" within the meaning of Rule 501 (a) promulgated pursuant
to the Act.
4. The Purchaser has been furnished with, and has had an opportunity to review
(a) a copy of the Trust Agreement and (b) such other information concerning the
Certificate, the Mortgage Loans and the Issuer as has been requested by the
Purchaser from the Issuer or the Seller and is relevant to the Purchaser's
decision to purchase the Certificate. The Purchaser has had any questions
arising from such review answered by the Issuer or the Seller to the
satisfaction of the Purchaser. If the Purchaser did not purchase the Certificate
in connection with the initial distribution of the Certificate, the Purchaser
acknowledges that the Issuer did not participate in or facilitate in any way the
purchase of the Certificate by the Purchaser from the Seller, and the Purchaser
agrees that it will look solely to the Seller and not to the Issuer with respect
to any damage, liability, claim or expense arising out of, resulting from or in
connection with its purchase of Certificate.
5. The Purchaser has not and will not nor has it authorized or will it authorize
any person to (a) offer, pledge, sell, dispose of or otherwise transfer any
Certificate, any interest in any Certificate or any other similar security to
any person in any manner, (b) solicit any offer to buy or to accept a pledge,
disposition of other transfer of any Certificate, any interest in any
Certificate or any other similar security from any person in any manner, (c)
otherwise approach or negotiate with respect to any Certificate, any interest in
any Certificate or any other similar security with any person in any manner, (d)
make any general solicitation by means of general advertising or in any other
manner or (e) take any other action, that (as to any of (a) through (e) above)
would constitute a distribution of any Certificate under the Act, that would
render the disposition of any Certificate a violation of Section 5 of the Act or
any state securities law, or that would require registration or qualification
pursuant thereto. The Purchaser will not sell or otherwise transfer any
Certificate, except in compliance with the provisions of the Trust Agreement.
6. The Purchaser represents:
that either a. or b. is satisfied, as marked below:
___ a. The Purchaser is not any employee benefit plan subject to the
prohibited transaction restrictions and the fiduciary
responsibility requirement of the Employee Retirement Income
Security Act of 1974, as amended ("ERISA"), the Internal Revenue
Code of 1986, as amended (the "Code") or substantially similar
rules of state, local or federal law ("Similar Law"), a Person
acting, directly or indirectly, on behalf of any such plan or any
Person acquiring the Certificate with "plan assets" within the
meaning of the Department of Labor regulation promulgated at 29
C.F.R. ss. 2510.3-101; or
___ b. The Purchaser will provide the Depositor, the Owner Trustee,
the Certificate Registrar with either: (i) an opinion of counsel,
satisfactory to the Depositor, the Owner Trustee and the
Certificate Registrar, to the effect that the purchase and
holding of a Certificate by or on behalf of the Purchaser is
permissible under applicable law, will not constitute or result
in a prohibited transaction under ERISA, Section 4975 of the Code
or Similar Law (or comparable provisions of any subsequent
enactments) and will not subject the Depositor, the Owner Trustee
or the Certificate Registrar to any obligation or liability
(including liabilities under ERISA, Section 4975 of the Code or
Similar Law) in addition to those undertaken in the Trust
Agreement, which opinion of counsel shall not be an expense of
the Depositor, the Owner Trustee or the Certificate Registrar, or
(ii) in lieu of such opinion of counsel, a certification in the
form of Exhibit G to the Trust Agreement upon which the
Depositor, the Owner Trustee and the Certificate Registrar may
rely without further inquiry or investigation; and
the Purchaser is familiar with the prohibited transaction restrictions and
fiduciary responsibility requirements of ERISA, Section 4975 of the Code and
Similar Law and understands that each of the parties to which this certification
is made is relying and will continue to rely on the statements made in this
paragraph.
7. The Purchaser is not a non-United States person.
Very truly yours,
By: ___________________________________________
Name:
Title:
EXHIBIT E
FORM OF TRANSFEROR REPRESENTATION LETTER
_________, ______
Bear ▇▇▇▇▇▇▇ Asset Backed Securities, Inc.
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇▇ Fargo Bank Minnesota, National Association
as Certificate Registrar
▇▇▇▇▇ Fargo Center
Sixth and Marquette
▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Corporate Trust Administration
Re: Home Equity Loan Backed Certificate,
Series 2003-C
Ladies and Gentlemen:
_______________ (the "Purchaser") intends to purchase from __________ (the
"Seller") a __% Percentage Interest of Home Equity Loan-Backed Certificate,
Series 2003-C (the "Certificate"), issued pursuant to the trust agreement dated
as of August 1, 2003 (the "Trust Agreement"), between Bear ▇▇▇▇▇▇▇ Asset Backed
Securities, Inc., as depositor (the "Depositor"), and Wilmington Trust Company,
as owner trustee (the "Owner Trustee"), as acknowledged and agreed by ▇▇▇▇▇
Fargo Bank Minnesota, National Association, as Certificate Registrar. All terms
used herein and not otherwise defined shall have the meanings set forth in
Appendix A to the indenture dated as of August 1, 2003 (the "Indenture"),
between the Issuer and the Indenture Trustee. The Seller hereby certifies,
represents and warrants to, and covenants with, the Issuer and the Certificate
Registrar that:
Neither the Seller nor anyone acting on its behalf has (a) offered,
pledged, sold, disposed of or otherwise transferred any Certificate, any
interest in any Certificate or any other similar security to any person in any
manner, (b) has solicited any offer to buy or to accept a pledge, disposition or
other transfer of any Certificate, any interest in any Certificate or any other
similar security from any person in any manner, (c) has otherwise approached or
negotiated with respect to any Certificate, any interest in any Certificate or
any other similar security with any person in any manner, (d) has made any
general solicitation by means of general advertising or in any other manner, or
(e) has taken any other action, that (as to any of (a) through (e) above) would
constitute a distribution of the Certificate under the Securities Act of 1933,
as amended (the "Act"), that would render the disposition of any Certificate a
violation of Section 5 of the Act or any state securities law, or that would
require registration or qualification pursuant thereto. The Seller will not act,
in any manner set forth in the foregoing sentence with respect to any
Certificate. The Seller has not and will not sell or otherwise transfer any
Certificate, except in compliance with the provisions of the Trust Agreement.
Very truly yours,
By:____________________________
Seller)
By:____________________________
Name:
Title:
EXHIBIT F
CERTIFICATE OF NON-FOREIGN STATUS
This Certificate of Non-Foreign Status (the "Certificate") is delivered
pursuant to Section 3.04 of the trust agreement dated as of August 1, 2003 (the
"Trust Agreement"), between Bear ▇▇▇▇▇▇▇ Asset Backed Securities, Inc., as
Depositor, and Wilmington Trust Company, as Owner Trustee, in connection with
the acquisition of, transfer to or possession by the undersigned, whether as
beneficial owner (the "Beneficial Owner"), or nominee on behalf of the
Beneficial Owner of the Home Equity Loan-Backed Certificates, Series 2003-C (the
"Certificate"). Capitalized terms used herein but not otherwise defined shall
have the meanings ascribed thereto in Appendix A to the Indenture dated as of
August 1, 2003 (the "Indenture"), between the Issuer and the Indenture Trustee.
Each holder must complete Part I, Part II (if the holder is a nominee), and
in all cases sign and otherwise complete Part III.
In addition, each holder shall submit with this Certificate an IRS Form W-9
relating to such holder.
To confirm to the Trust that the provisions of Sections 871, 881 or 1446 of
the Internal Revenue Code (relating to withholding tax on foreign partners) do
not apply in respect of the Certificate held by the undersigned, the undersigned
hereby certifies:
Part I - Complete Either A or B
A. Individual as Beneficial Owner
1. I am (The Beneficial Owner is) not a non-resident alien for
purposes of U.S. income taxation;
2. My (The Beneficial Owner's) name and home address are:
_____________________________
_____________________________; and
3. My (The Beneficial Owner's) U.S. taxpayer identification number
(Social Security Number) is ___________________.
B. Corporate, Partnership or Other Entity as Beneficial Owner
1. _________________ (Name of the Beneficial Owner) is not a
foreign corporation, foreign partnership, foreign trust or foreign estate
(as those terms are defined in the Code and Treasury Regulations;
2. The Beneficial Owner's office address and place of
incorporation (if applicable) is _____________; and
3. The Beneficial Owner's U.S. employer identification number is
________________.
Part II - Nominees
If the undersigned is the nominee for the Beneficial Owner, the undersigned
certifies that this Certificate has been made in reliance upon information
contained in:
___ an IRS Form W-9
___ a form such as this or substantially similar
provided to the undersigned by an appropriate person and (i) the undersigned
agrees to notify the Trust at least 30 days prior to the date that the form
relied upon becomes obsolete, and (ii) in connection with change in Beneficial
Owners, the undersigned agrees to submit a new Certificate to the Trust promptly
after such change.
Part III - Declaration
The undersigned, as the Beneficial Owner or a nominee thereof, agrees to
notify the Trust within 60 days of the date that the Beneficial Owner becomes a
foreign person. The undersigned understands that this Certificate may be
disclosed to the Internal Revenue Service by the Trust and any false statement
contained therein could be punishable by fines, imprisonment or both.
Under penalties of perjury, I declare that I have examined this Certificate
and to the best of my knowledge and belief it is true, correct and complete and
will further declare that I will inform the Trust of any change in the
information provided above, and, if applicable, I further declare that I have
the authority* to sign this document.
____________________________________________________________
Name
____________________________________________________________
Title (if applicable)
____________________________________________________________
Signature and Date
*NOTE: If signed pursuant to a power of attorney, the power of attorney must
accompany this Certificate.
EXHIBIT G
FORM OF ERISA REPRESENTATION LETTER
___________, ____
Bear ▇▇▇▇▇▇▇ Asset Backed Securities, Inc.
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Wilmington Trust Company
▇▇▇▇▇▇ Square North
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ Fargo Bank Minnesota, National Association
as Certificate Registrar
▇▇▇▇▇ Fargo Center
Sixth and Marquette
▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Re: Bear ▇▇▇▇▇▇▇ Asset Backed Securities Inc.
HOME EQUITY LOAN-BACKED CERTIFICATE SERIES 2003-C
Dear Sirs:
____________ (the "Transferee") intends to acquire from ____________ (the
"Seller") a __% Percentage Interest of Home Equity Loan-Backed Certificate,
Series 2003-C (the "Certificate"), issued pursuant to a trust agreement dated as
of August 1, 2003 (the "Trust Agreement"), between Bear ▇▇▇▇▇▇▇ Asset Backed
Securities, Inc., as depositor (the "Depositor"), and Wilmington Trust Company,
as owner trustee (the "Owner Trustee"). Capitalized terms used herein and not
otherwise defined shall have the meanings ascribed thereto in Appendix A to the
indenture dated as of August 1, 2003 (the "Indenture"), between the Issuer and
the Indenture Trustee.
The Transferee hereby certifies, represents and warrants to, and covenants
with, the Depositor, the Owner Trustee and the Certificate Registrar that
either:
(a) The Certificate (i) is not being acquired by, and will not be
transferred to, any employee benefit plan within the meaning of section 3(3) of
the Employee Retirement Income Security Act of 1974, as amended ("ERISA") or
other retirement arrangement, including individual retirement accounts and
annuities, ▇▇▇▇▇ plans and bank collective investment funds and insurance
company general or separate accounts in which such plans, accounts or
arrangements are invested, that is subject to Section 406 of ERISA, Section 4975
of the Internal Revenue Code of 1986, as amended (the "Code"), or substantially
similar rules of state, local or federal law ("Similar Law") (any of the
foregoing, a "Plan"), (ii) is not being acquired with "plan assets" within the
meaning of the Department of Labor ("DOL") regulation, 29 C.F.R. ss. 2510.3-101,
and (iii) will not be transferred to any entity that is deemed to be investing
plan assets within the meaning of the DOL regulation, 29 C.F.R. ss. 2510.3-101;
or
(b) The purchase of the Certificate is permissible under applicable law,
will not constitute or result in any prohibited transaction under ERISA, Section
4975 of the Code or Similar Law, will not subject the Depositor, the Owner
Trustee or the Certificate Registrar to any obligation in addition to those
undertaken in the Trust Agreement and, the following statement is accurate with
respect to the source of funds being used by the Transferee to acquire the
Certificate (the "Source"):
(A) the Transferee is an insurance company and (B) the Source is an
"insurance company general account," as such term is defined in
the Department of Labor's Prohibited Transaction Class Exemption
95-60 (issued July 12, 1995) ("PTCE 95-60"), (C) the purchase and
holding of the Certificate by the Transferee is exempt under PTCE
95-60, and (D) the purchase of the Certificate will not cause the
assets of the Trust to constitute "plan assets" (within the
meaning of the DOL regulation, 29 C.F.R. ss. 2510.3-101) as a
result of the satisfaction at all applicable times of the
requirements of Section 401(c) of ERISA and the regulations
promulgated thereunder.
(c) The Transferee is familiar with the prohibited transaction restrictions
and fiduciary responsibility requirements of ERISA, Section 4975 of the Code and
Similar Law and understands that each of the parties to which this certification
is made is relying and will continue to rely on the statements made herein.
Very truly yours,
By: ___________________________________________
Name:
Title:
EXHIBIT H
FORM OF REPRESENTATION LETTER
___________, ____
Bear ▇▇▇▇▇▇▇ Asset Backed Securities, Inc.
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Wilmington Trust Company,
as Owner Trustee
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ Fargo Bank Minnesota, National Association
as Certificate Registrar
▇▇▇▇▇ Fargo Center
Sixth and Marquette
▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Re: Bear ▇▇▇▇▇▇▇ Asset Backed Securities Inc.
Home Equity Loan-Backed Certificate Series 2003-C
Dear Sirs:
_____________ (the "Transferee") intends to acquire from ____________ (the
"Seller") a __% Percentage Interest of Home Equity Loan-Backed Certificate,
Series 2003-C (the "Certificate"), issued pursuant to a trust agreement dated as
of August 1, 2003 (the "Trust Agreement"), between Bear ▇▇▇▇▇▇▇ Asset Backed
Securities, Inc., as depositor (the "Depositor"), and Wilmington Trust Company,
as owner trustee (the "Owner Trustee"). Capitalized terms used herein and not
otherwise defined shall have the meanings ascribed thereto in Appendix A to the
indenture dated as of August 1, 2003 (the "Indenture"), between the Issuer and
the Indenture Trustee.
The Transferee hereby certifies, represents and warrants to, and covenants
with, the Depositor, the Owner Trustee and the Certificate Registrar that:
(a) the Transferee is acquiring the Certificate for its own behalf and is
not acting as agent or custodian for any other person or entity in connection
with such acquisition;
(b) the Transferee is not a partnership, grantor trust or S corporation for
federal income tax purposes, or, if the Transferee is a partnership, grantor
trust or S corporation for federal income tax purposes, the Certificate is not
more than 50% of the assets of the partnership, grantor trust or S corporation;
(c) the Transferee will not (x) incur indebtedness secured by the
Certificates where payments on such indebtedness bear a relationship to payments
on the Mortgage Loans within the meaning of Treasury Regulations Section
301.7701(i)-1(f) or (y) use a partnership, trust or other entity to indirectly
achieve the result described in clause (x); and
(d) the Transferee has been furnished with, and has had an opportunity to
review a copy of the Trust Agreement. The Transferee agrees to be bound by the
Trust Agreement, including, without limitation, Section 7.02 of the Trust
Agreement.
Very truly yours,
By: ___________________________________________
Name:
Title: