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EXHIBIT 4.4
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FORM OF
DEPOSIT TRUST AGREEMENT
AMONG
UNION PLANTERS HOME EQUITY CORP,
AS DEPOSITOR,
--------------------------,
AS OWNER TRUSTEE
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AS TRUST PAYING AGENT AND BOND ADMINISTRATOR,
AND
--------------------------------------------,
AS SERVICER
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UNION PLANTERS HOME EQUITY TRUST 20__-__
COLLATERAL MORTGAGE BONDS
SERIES 20__-__
DATED AS OF ____________ 20__
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TABLE OF CONTENTS
ARTICLE I DEFINITIONS...............................................................................................1
Section 1.1. Capitalized Terms...........................................................................1
Section 1.2. Other Definitional Provisions...............................................................4
ARTICLE II ORGANIZATION.............................................................................................6
Section 2.1. Name........................................................................................6
Section 2.2. Office......................................................................................6
Section 2.3. Purposes and Powers.........................................................................6
Section 2.4. Appointment of Owner Trustee................................................................7
Section 2.5. Initial Capital Contribution of Owner Trust Estate..........................................7
Section 2.6. Declaration of Trust........................................................................7
Section 2.7. Liability of the Holders....................................................................8
Section 2.8. Title to Trust Property.....................................................................8
Section 2.9. Situs of Trust..............................................................................8
Section 2.10. Representations and Warranties of the Company; Covenant of the Company......................9
Section 2.11. Federal Income Tax Provisions..............................................................12
ARTICLE III CERTIFICATES AND TRANSFER OF INTERESTS.................................................................16
Section 3.1. Initial Ownership..........................................................................16
Section 3.2. The Certificates...........................................................................16
Section 3.3. Execution, Authentication and Delivery of Trust Certificates...............................16
Section 3.4. Registration of Transfer and Exchange of Trust Certificates................................17
Section 3.5. Mutilated, Destroyed, Lost or Stolen Certificates..........................................17
Section 3.6. Persons Deemed Owners......................................................................18
Section 3.7. Access to List of Holders' Names and Addresses.............................................18
Section 3.8. Maintenance of Office or Agency............................................................18
Section 3.9. Appointment of Trust Paying Agent..........................................................19
Section 3.10. Restrictions on Transfer of Certificates...................................................19
ARTICLE IV ACTIONS BY OWNER TRUSTEE................................................................................22
Section 4.1. Prior Notice to Holders with Respect to Certain Matters....................................22
Section 4.2. Action by Holders with Respect to Bankruptcy...............................................24
Section 4.3. Restrictions on Holders' Power.............................................................24
Section 4.4. Majority Control...........................................................................24
ARTICLE V APPLICATION OF TRUST FUNDS; CERTAIN DUTIES...............................................................25
Section 5.1. Establishment of Certificate Distribution Account..........................................25
Section 5.2. Application of Trust Funds.................................................................25
Section 5.3. Method of Payment..........................................................................27
Section 5.4. Segregation of Moneys; No Interest.........................................................27
ARTICLE VI AUTHORITY AND DUTIES OF OWNER TRUSTEE...................................................................27
Section 6.1. General Authority..........................................................................27
Section 6.2. General Duties.............................................................................28
Section 6.3. Action upon Instruction....................................................................28
Section 6.4. No Duties Except as Specified in this Agreement, the Basic Documents or Any Instructions...30
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Section 6.5. No Action Except Under Specified Documents or Instructions.................................30
Section 6.6. Restrictions...............................................................................30
ARTICLE VII CONCERNING THE OWNER TRUSTEE...........................................................................31
Section 7.1. Acceptance of Trusts and Duties............................................................31
Section 7.2. Furnishing of Documents....................................................................32
Section 7.3. Representations and Warranties.............................................................33
Section 7.4. Reliance; Advice of Counsel................................................................34
Section 7.5. Not Acting in Individual Capacity..........................................................35
Section 7.6. Owner Trustee Not Liable for Certificates or Mortgage Loans................................35
Section 7.7. Owner Trustee May Own Certificates and Bonds...............................................35
Section 7.8. Licenses...................................................................................36
ARTICLE VIII COMPENSATION OF OWNER TRUSTEE.........................................................................36
Section 8.1. Owner Trustee's Fees and Expenses..........................................................36
Section 8.2. Indemnification............................................................................36
Section 8.3. Payments to the Owner Trustee..............................................................37
Section 8.4. Servicer Liability.........................................................................37
ARTICLE IX TERMINATION OF TRUST AGREEMENT..........................................................................37
Section 9.1. Termination of Trust Agreement.............................................................37
ARTICLE X SUCCESSOR OWNER TRUSTEES AND ADDITIONAL OWNER TRUSTEES...................................................39
Section 10.1. Eligibility Requirements for Owner Trustee.................................................39
Section 10.2. Resignation or Removal of Owner Trustee....................................................39
Section 10.3. Successor Owner Trustee....................................................................40
Section 10.4. Merger or Consolidation of Owner Trustee...................................................41
Section 10.5. Appointment of Co-Trustee or Separate Trustee..............................................41
ARTICLE XI CONTRIBUTION OF MORTGAGE LOANS..........................................................................42
Section 11.1. Agreement to Contribute and Convey.........................................................42
Section 11.2. Conveyance of Mortgage Loans...............................................................43
Section 11.3. Assignment of Related Rights and Remedies..................................................44
Section 11.4. Closing....................................................................................45
Section 11.5. Servicing..................................................................................46
Section 11.6. Grant of a Security Interest...............................................................46
ARTICLE XII MANAGEMENT OF THE TRUST................................................................................47
Section 12.1. Powers and Duties of the Bond Administrator................................................47
Section 12.2. Compensation; Payment of Certain Expenses.................................................50
Section 12.3. Instruction of the Owner Trustee...........................................................51
Section 12.4. Benefit of the Agreement...................................................................51
Section 12.5. Limitation of Responsibility of the Bond Administrator.....................................51
Section 12.6. Termination of Bond Administrator..........................................................52
Section 12.7. Bankruptcy Matters.........................................................................53
ARTICLE XIII MISCELLANEOUS.........................................................................................54
Section 13.1. Supplements and Amendments.................................................................54
Section 13.2. No Legal Title to Owner Trust Estate in Holders............................................55
Section 13.3. Limitations on Rights of Others............................................................55
Section 13.4. Notices....................................................................................56
Section 13.5. Severability...............................................................................56
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Section 13.6. Separate Counterparts......................................................................57
Section 13.7. Successors and Assigns.....................................................................57
Section 13.8. No Petition................................................................................57
Section 13.9. No Recourse................................................................................57
Section 13.10. Headings...................................................................................57
Section 13.11. GOVERNING LAW..............................................................................57
Section 13.12. Grant of Certificateholder Rights to Bond Insurer..........................................58
Section 13.13. Third Party Beneficiary....................................................................58
Section 13.14. Suspension and Termination of Bond Insurer's Rights........................................58
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DEPOSIT TRUST AGREEMENT
This DEPOSIT TRUST AGREEMENT, dated as of __________ 20__, among UNION
PLANTERS HOME EQUITY CORP, a Delaware corporation, as Depositor (the "Company"),
__________________, a ______________________, as Owner Trustee (the "Owner
Trustee") and __________________________, a __________________, as Trust Paying
Agent and Bond Administrator (in each such capacity, the "Trust Paying Agent" or
the "Bond Administrator"), and ____________________________, as Servicer (the
"Servicer"), is entered into for the limited purposes set forth herein.
ARTICLE I
DEFINITIONS
A. Capitalized Terms.
For all purposes of this Agreement, the following terms shall have the
meanings set forth below:
"ACCOUNTS" shall mean, collectively, the Collection Account and the
Bond Account.
"AGREEMENT" shall mean this Deposit Trust Agreement, as may be amended
and supplemented from time to time.
"ANNUAL TAX REPORTS" shall have the meaning assigned thereto in Section
2.11(k).
"BASIC DOCUMENTS" shall mean this Agreement, the Servicing Agreement,
the Sales Agreement, [the Insurance Agreement,] and the Indenture.
"BOND ACCOUNT" shall have the meaning assigned thereto in the
Indenture.
"BOND ADMINISTRATOR" shall mean ___________________, or any successor
thereto.
"BOND INSURER" shall mean _________________________.
"BOND INSURER DEFAULT" shall have the meaning assigned to such term in
the Indenture.
"BONDS" shall mean the Issuer's Collateralized Mortgage Bonds, Series
20__-__.
"BUSINESS DAY" shall mean any day other than (i) a Saturday or Sunday
or (ii) a day that is either a legal holiday or a day on which banking
institutions in the State of New York, the State of Tennessee, the State of
Delaware, or the state in which the Trust Paying Agent's office from which
payments will be made to Certificateholders are authorized or obligated by law,
regulation or executive order to be closed.
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"BUSINESS TRUST STATUTE" shall mean Chapter 38 of Title 12 of I the
Delaware Code, 12 Del. Code S 3801 et seq., as the same may be amended from time
to time.
"CAPITAL ACCOUNT" shall have the meaning assigned thereto in Section
2.11(a).
"CERTIFICATE" shall mean a certificate evidencing the beneficial
interest of a Certificateholder in the Trust, substantially in the form attached
hereto as Exhibit A.
"CERTIFICATE DISTRIBUTION ACCOUNT" shall have the meaning assigned to
such term in Section 5.1.
"CERTIFICATE OF TRUST" shall mean the Certificate of Trust in the form
of Exhibit B to be filed for the Trust pursuant to Section 3810(a) of the
Business Trust Statute.
"CERTIFICATE REGISTER" and "CERTIFICATE REGISTRAR" shall mean the
register mentioned and the registrar appointed pursuant to Section 3.4.
"CERTIFICATEHOLDER" or "HOLDER" shall mean a Person in whose name a
Certificate is registered.
"CODE" shall mean the Internal Revenue Code of 1986, as amended, and,
where appropriate in context, Treasury Regulations promulgated thereunder.
"COLLECTION ACCOUNT" shall have the meaning assigned thereto in the
Servicing Agreement.
"COMPANY" shall mean Union Planters Home Equity Corp., a Delaware
corporation.
"CORPORATE TRUST OFFICE" shall mean, with respect to the Owner Trustee,
the principal corporate trust office of the Owner Trustee located at
________________________; or at such other address in the [▇▇▇▇ of Delaware]as
the Owner Trustee may designate by notice to the Certificateholders and the
Company, or the principal corporate trust office of any successor Owner Trustee
[the address (which shall be in the State of Delaware)] of which the successor
owner trustee will notify the Certificateholder and the Company).
"ERISA" shall mean the Employee Retirement Income Security Act of 1974,
as amended.
"EXCHANGE ACT" shall mean the Securities Exchange Act of 1934, as
amended.
"EXPENSES" shall have the meaning assigned to such term in Section 8.2.
"HOLDER NONRECOURSE DEBT MINIMUM GAIN" shall have the meaning set forth
for "partner nonrecourse debt minimum gain" in Treasury Regulations Section
1.704-2(i)(2). A Holder's share of Holder Nonrecourse Debt Minimum Gain shall be
determined in accordance with Treasury Regulations Section 1.704-2(i)(5).
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"INDENTURE" shall mean the Indenture, dated as of ____________ 20___,
by and between the Issuer and the Indenture Trustee.
"INDENTURE TRUSTEE" means ________________________, as Indenture
Trustee under the Indenture.
["INSURANCE AGREEMENT" means the Insurance Agreement, dated as of
____________ 20__, among ______________________, the Issuer,
_________________________, as Seller and Servicer, the Company, and the
Indenture Trustee.]
["INSURANCE POLICY" shall mean the policy issued by the Bond Insurer
for the benefit of the holders of the Bonds.]
"ISSUER" shall mean Union Planters Home Equity Trust 20__-__, the
Delaware business trust created pursuant to this Agreement.
"NON-U.S. PERSON" shall mean an individual, corporation, partnership or
other person other than a citizen or resident of the United States, a
corporation, partnership or other entity created or organized in or under the
laws of the United States or any political subdivision thereof, an estate that
is subject to U.S. federal income tax regardless of the source of its income or
a trust if (i) a court in the United States is able to exercise primary
supervision over the administration of the trust and (ii) one or more United
States fiduciaries have the authority to control all substantial decisions of
the trust.
"OWNER TRUST ESTATE" shall mean the Trust Estate (as defined in the
Indenture), including the contribution of $1 referred to in Section 2.5 hereof.
"OWNER TRUSTEE" shall mean ____________________, a
_____________________, not in its individual capacity but solely as owner
trustee under this Agreement, and any successor owner trustee hereunder.
"PAYMENT DATE" shall mean the [____] day of each month or, if such
[____] day is not a Business Day, the next succeeding Business Day, commencing
_______________.
"PERCENTAGE INTEREST" shall mean with respect to any Certificate the
percentage portion of all of the Trust Interest evidenced thereby as stated on
the face of such Certificate.
"PERMITTED INVESTMENTS" shall have the meaning assigned to such term in
the Indenture.
"PROSPECTIVE HOLDER" shall have the meaning set forth in Section
3.11(a).
"RATING AGENCY CONDITION" means, with respect to any action to which a
Rating Agency Condition applies, that each Rating Agency shall have been given
[___ days] (or such shorter period as is acceptable to each Rating Agency) prior
notice thereof and that each of the Rating
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Agencies shall have notified the Company, the Servicer, the Bond Insurer, the
Owner Trustee, and the Issuer in writing that such action will not result in a
reduction or withdrawal of the then current "implied" rating of the Bonds that
it maintains [without taking into account the Bond Insurance].
"RECORD DATE" shall mean as to each Payment Date the last Business Day
of the month immediately preceding the month in which such Payment Date occurs.
"SALES AGREEMENT" shall mean that certain Sales Agreement, dated as of
_____________ _____, among ________________________, as Seller, and the Company,
as Purchaser.
"SERVICING AGREEMENT" shall mean the Servicing Agreement dated as of
______________, among the Trust, as Issuer, the Indenture Trustee, and
__________________, as Servicer.
"SECRETARY OF STATE" shall mean the Secretary of State of the State of
Delaware.
"TAXABLE YEAR" shall have the meaning assigned thereto in Section
2.11(j).
"TAX MATTERS PARTNER" shall have the meaning assigned thereto in
Section 2.11(l).
"TREASURY REGULATIONS" shall mean regulations, including proposed or
temporary regulations, promulgated under the Code. References herein to specific
provisions of proposed or temporary regulations shall include analogous
provisions of final Treasury Regulations or other successor Treasury
Regulations.
"TRUST" shall mean the trust established by this Agreement.
"TRUST INTEREST" shall mean the right to receive, on each Payment Date,
distributions of the amounts, if any, released to the Issuer pursuant to Section
8.02(d) of the Indenture or pursuant to Section 2.05 of the Servicing Agreement.
"TRUST MINIMUM GAIN" shall have the meaning set forth for "partnership
minimum gain" in Treasury Regulations 1.704-2(b)(2) and 1.704-2(d). In
accordance with Treasury Regulations Section 1.704-2(d), the amount of Trust
Minimum Gain is determined by first computing, for each nonrecourse liability of
the Trust, any gain the Trust would realize if it disposed of the property
subject to that liability for no consideration other than full satisfaction of
the liability, and then aggregating the separately computed gains. A Holder's
share of Trust Minimum Gain shall be determined in accordance with Treasury
Regulations Section 1.704-2(g)(1).
"TRUST PAYING AGENT" shall mean any paying agent or co-paying agent
appointed pursuant to Section 3.9 and authorized by the Owner Trustee to make
payments to and distributions from the Certificate Distribution Account.
B. Other Definitional Provisions.
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1. Capitalized terms used herein and not otherwise
defined herein have the meanings assigned to them in
the Servicing Agreement or, if not defined therein,
in the Indenture.
2. 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.
3. 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.
4. The words "hereof," "herein," "hereunder," and words
of similar import when used in this Agreement shall
refer to this Agreement as a whole and not to any
particular provision of this Agreement; Section and
Exhibit references contained in this Agreement are
references to Sections and Exhibits in or to this
Agreement unless otherwise specified; and the term
"including" shall mean "including without
limitation."
5. 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.
6. Any agreement, instrument, or statute defined or
referred to herein or in any instrument or
certificate delivered in connection herewith means
such agreement, instrument, or statute as from time
to time amended, modified, or supplemented and
includes (in the case of agreements or instruments)
references to all attachments thereto and instruments
incorporated therein; references to a Person are also
to its permitted successors and assigns.
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ARTICLE II
ORGANIZATION
A. Name.
The Trust created hereby shall be known as "Union Planters Home Equity
Trust 20__-__," 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.
B. Office.
The office of the Trust shall be in care of the Owner Trustee at the
Corporate Trust Office or at such other address in [Delaware] as the Owner
Trustee may designate by written notice to the Certificateholders, the [Bond
Insurer] and the Company.
C. Purposes and Powers.
The purpose of the Trust is to engage in the following activities:
a. to issue the Bonds pursuant to the Indenture and to
sell such Bonds;
b. with the proceeds of the sale of the Bonds, to pay
the organizational, start-up, and transactional
expenses of the Trust and to pay the balance to the
Company pursuant to Article XI.
c. to assign, grant, transfer, pledge, mortgage, and
convey the Owner Trust Estate pursuant to the
Indenture and to hold, manage, and distribute to the
Holders any portion of the Owner Trust Estate
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 or is to be a party;
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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;
f. subject to compliance with the Basic Documents, to
engage in such other activities as may be required in
connection with conservation of the Owner Trust
Estate and the making of distributions and payments
to the Holders and the Bondholders; and
g. to issue the Certificates pursuant to this Agreement.
The Trust is hereby authorized by the initial Certificateholders to engage in
the foregoing activities. The Trust shall not engage in any activity other than
in connection with the foregoing or other than as required or authorized by the
terms of this Agreement or the Basic Documents. D. Appointment of Owner Trustee.
D. Appointment of Owner Trustee
The Company hereby appoints the Owner Trustee as trustee of the Trust
effective as of the date hereof, to have all the rights, powers, and duties set
forth herein.
E. Initial Capital Contribution of Owner Trust Estate.
The Company hereby sells, assigns, transfers, conveys, and sets over to
the Owner Trustee, as of the date hereof, the sum of [$1]. The Owner Trustee
hereby acknowledges receipt in trust from the Company, as of the date hereof, of
the foregoing contribution, which shall constitute the initial Owner Trust
Estate and shall be deposited in the Certificate Distribution Account. The
Certificateholders shall pay organizational expenses of the Trust as they may
arise or shall, upon the request of the Owner Trustee, promptly reimburse the
Owner Trustee for any such expenses paid by the Owner Trustee.
F. Declaration of Trust.
The Owner Trustee hereby declares that it will hold the Owner Trust
Estate in trust upon and subject to the conditions set forth herein for the use
and benefit of the Holders, subject to the obligations of the Trust under the
Basic Documents. It is the intention of the parties hereto
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that the Trust constitute a business trust under the Business Trust Statute and
that this Agreement constitute the governing instrument of such business trust.
It is the intention of the parties hereto that, solely for income and franchise
tax purposes, after issuance of the Certificates, the Trust shall be treated as
a partnership, with the assets of the partnership being the Mortgage Loans and
other assets held by the Trust, the partners of the partnership being the
holders of the Certificates and the Bonds being non-recourse debt of the
partnership (or, if there is only one Certificateholder, that the Trust shall be
disregarded as an entity separate from such Holder, with the assets held by the
Trust being treated as assets of the Holder and the Bonds being treated as
non-recourse debt of the Holder). The parties agree that, unless otherwise
required by appropriate tax authorities or unless the Trust is disregarded as an
entity separate from its sole Certificateholder for income and franchise tax
purposes, the Owner Trustee will file or cause to be filed annual or other
necessary returns, reports, and other forms consistent with the characterization
of the Trust as a partnership for such tax purposes pursuant to Section 2.11(k).
The parties agree that no election will be made to treat the Trust or the Owner
Trust Estate as a real estate mortgage investment conduit as defined in Section
860D of the Code. Effective as of the date hereof, the Owner Trustee shall have
all rights, powers, and duties set forth herein and in the Business Trust
Statute with respect to accomplishing the purposes of the Trust. The Owner
Trustee shall file the Certificate of Trust with the Secretary of State.
G. Liability of the Holders.
No Holder shall have any personal liability for any liability or
obligation of the Trust. The Certificates shall be fully paid and
non-assessable.
H. Title to Trust Property.
1. Subject to the Indenture, legal title to all of the
Owner Trust Estate shall be vested at all times in
the Trust as a separate legal entity except where
applicable law in any jurisdiction requires title to
any part of the Owner Trust Estate to be vested in a
trustee or trustees, in which case title shall be
deemed to be vested in the Owner Trustee and/or a
separate trustee, as the case may be.
2. The Certificateholders shall not have legal title to
any part of the Owner Trust Estate. No transfer by
operation of law or otherwise of any interest of the
Certificateholders shall operate to terminate this
Agreement or the trusts hereunder or entitle any
transferee to an Accounting or to the transfer to it
of any part of the Owner Trust Estate.
I. Situs of Trust.
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The Trust will be located and administered in the [State of Delaware].
All accounts maintained at a bank by the Owner Trustee on behalf of the Trust
shall be located in the [State of Delaware], the [State of
_____________________, or the State of Tennessee]. The Trust shall not have any
employees; provided however, nothing herein shall restrict or prohibit the Owner
Trustee from having employees within or without the [State of Delaware].
Payments will be received by the Trust only in [Delaware, New York,
____________________, or Tennessee], and payments will be made by the Trust only
from [Delaware, New York, __________________, or Tennessee.] The only office of
the Trust will be at the Corporate Trust Office in Delaware.
J. Representations and Warranties of the Company; Covenant of the
Company.
1. The Company hereby represents and warrants to the
Owner Trustee and the Bond Insurer that:
a. The Company 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 Company has the power and authority to
execute and deliver this Agreement and to
carry out its terms; the Company has full
power and authority to transfer and assign
the property to be transferred and assigned
to and deposited with the Trust and the
Company has duly authorized such transfer
and assignment and deposit to the Trust by
all necessary corporate action; and the
execution, delivery and performance of this
Agreement has been duly authorized by the
Company by all necessary corporate action.
c. The consummation of the transactions
contemplated by this Agreement and the
fulfillment of the terms hereof do not
conflict with, result in any breach of any
of the terms and provisions of, or
constitute (with or without notice or lapse
of time) a default under, the certificate of
incorporation or by-laws of the Company, or
any indenture, agreement, or other
instrument to which the Company 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
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the best of the Company's knowledge, any
order, rule, or regulation applicable to the
Company of any court or of any Federal or
state regulatory body, administrative
agency, or other governmental
instrumentality having jurisdiction over the
Company or its properties.
d. There are no proceedings or investigations
pending or notice of which has been received
in writing before any court, regulatory
body, administrative agency, or other
governmental instrumentality having
jurisdiction over the Company or its
properties: (x) asserting the invalidity of
this Agreement, (y) seeking to prevent the
consummation of any of the transactions
contemplated by this Agreement, or (z)
seeking any determination or ruling that
should reasonably be expected to materially
and adversely affect the performance by the
Company of its obligations under, or the
validity or enforceability of, this
Agreement.
e. The Company is not in violation of, and its
execution and delivery of this Agreement and
its performance and compliance with the
terms of this Agreement will not constitute
a violation of, any law, any order, or
decree of any court or arbiter, or any
order, regulation, or demand of any federal,
state, or local governmental or regulatory
authority, which violation is likely to
affect materially and adversely either the
ability of the Company to perform its
obligations under this Agreement or the
financial condition of the Company.
f. The assignment of the Mortgage Loans to the
Trust as contemplated herein is not subject
to any bulk transfer or similar law in
effect in any applicable jurisdiction;
g. The Company has no knowledge of any recent
adverse financial condition or event with
respect to itself that is likely to
materially and adversely affect its ability
to perform its obligations under this
Agreement.
h. The Company has not failed to obtain any
consent, approval, authorization, or order
of, and has not failed to cause any
registration or qualification with, any
court or regulatory authority
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or other governmental body having
jurisdiction over the Company, which
consent, approval, authorization, order,
registration, or qualification is required
for, and the absence of which would
materially and adversely affect, the legal
and valid execution, delivery, and
performance of this Agreement by the
Company. No consent or approval of any other
person or entity is necessary for the
Company to transfer the Mortgage Loans to
the Trust as contemplated herein, or, if any
such consent or approval is necessary, such
consent or approval has previously been
obtained.
i. Immediately prior to the transfer and
assignment herein contemplated, the Company
held good, marketable, and indefeasible
title to, and was the sole owner of, each
Mortgage Loan conveyed by the Company
subject to no liens, charges, mortgages,
encumbrances, or rights of others, except
with respect to liens that will be released
simultaneously with such transfer and
assignment; and immediately upon the
transfer and assignment herein contemplated,
the Trust will hold good, marketable, and
indefeasible title to, and be the sole owner
of, each Mortgage Loan subject to no liens,
charges, mortgages, encumbrances, or rights
of others and the assignment of the Mortgage
Loans contemplated hereby is valid and
effective.
2. The representations and warranties of __________ with
respect to the Mortgage Loans set forth in the Sales
Agreement are hereby incorporated by reference in
their entirety and are assigned to the Trust in lieu
of any other representations and warranties of the
Company in respect of the Mortgage Loans. Nothing
herein shall be deemed to limit in any respect either
the representations and warranties of
_______________________ or the rights and remedies
assigned by the Company to the Trust against
_________________________ on account of a breach
thereof under the Sales Agreement.
3. Except for the representations and warranties of the
Company in Section 2.10(a) hereof, the Company is
contributing and conveying the Mortgage Loans,
without recourse to the Company and without
representations or warranties of any kind, express,
or implied, by the Company, whether statutory or
otherwise, including, without limitation, any
warranties of transfer, merchantability, or fitness
for a particular, or the Trust's intended, use, or
purposes.
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4. Each Certificateholder covenants with the Owner
Trustee [and the Bond Insurer] that during the
continuance of this Agreement, and while it holds
Certificates, it will comply in all respects with the
provisions of its certificate of incorporation in
effect from time to time.
K. Federal Income Tax Provisions.
If the Trust is treated as a partnership (rather than disregarded as a
separate entity) for federal income tax purposes pursuant to Section 2.6, the
following provisions shall apply:
1. A separate capital account (a "Capital Account")
shall be established and maintained for each
Certificateholder in accordance with Treasury
Regulations Section 1.704-1(b)(2)(iv). No
Certificateholder shall be entitled to interest on
its Capital Account or any capital contribution made
by such Holder to the Trust.
2. Upon termination of the Trust pursuant to Article IX,
any amounts available for distribution to Holders
shall be distributed to the Holders with positive
Capital Account balances in accordance with such
balances. For purposes of this Section 2.11(b), the
Capital Account of each Holder shall be determined
after all adjustments made in accordance with this
Section 2.11 resulting from the Trust's operations
and from all sales and dispositions of all or any
part of the assets of the Trust. Any distributions
pursuant to this Section 2.11(b) shall be made by the
end of the Taxable Year in which the termination
occurs (or, if later, [within __ days] after the date
of the termination).
3. No Certificateholder shall be required to restore any
deficit balance in its Capital Account. Furthermore,
no Holder shall be liable for the return of the
Capital Account of, or of any capital contribution
made to the Trust by, another Holder.
4. Profit and loss of the Trust for each Taxable Year
shall be allocated to the Certificateholders in
accordance with their respective Percentage
Interests.
5. Notwithstanding any provision to the contrary, (i)
any expense of the Trust that is a "nonrecourse
deduction" within the meaning of Treasury Regulations
Section 1.704-2(b)(1) shall be allocated in
accordance with the Holders' respective Percentage
Interests, (ii) any expense of the Trust that is a
"partner nonrecourse deduction" within the meaning of
Treasury Regulations Section 1.704-2(i)(2) shall be
allocated in accordance with
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Treasury Regulations Section 1.704-2(i)(1), (iii) if
there is a net decrease in Trust Minimum Gain within
the meaning of Treasury Regulations Section
1.704-2(f)(1) for any Taxable Year, items of gain and
income shall be allocated among the Holders in
accordance with Treasury Regulations Section
1.704-2(f) and the ordering rules contained in
Treasury Regulations Section 1.704-2(j), and (iv) if
there is a net decrease in Holder Nonrecourse Debt
Minimum Gain within the meaning of Treasury
Regulations Section 1.704-2(i)(4) for any Taxable
Year, items of gain and income shall be allocated
among the Holders in accordance with Treasury
Regulations Section 1.704-2(i)(4) and the ordering
rules contained in Treasury Regulations Section
1.704-2(j). A Holder's "interest in partnership
profits" for purposes of determining its share of the
nonrecourse liabilities of the Trust within the
meaning of Treasury Regulations Section 1.752-3(a)(3)
shall be such Holder's Percentage Interest.
6. If a Holder receives in any Taxable Year an
adjustment, allocation, or distribution described in
subparagraphs (4), (5), or (6) of Treasury
Regulations Section 1.704-1(b)(2)(ii)(d) that causes
or increases a negative balance in such Holder's
Capital Account that exceeds the sum of such Holder's
shares of Trust Minimum Gain and Holder Nonrecourse
Debt Minimum Gain, as determined in accordance with
Treasury Regulations Sections 1.704-2(g) and
1.704-2(i), such Holder shall be allocated specially
for such Taxable Year (and, if necessary, later
Taxable Years) items of income and gain in an amount
and manner sufficient to eliminate such negative
Capital Account balance as quickly as possible as
provided in Treasury Regulations Section
1.704-1(b)(2)(ii)(d). After the occurrence of an
allocation of income or gain to a Holder in
accordance with this Section 2.11(f), to the extent
permitted by Regulations Section 1.704-1(b), items of
expense or loss shall be allocated to such Holder in
an amount necessary to offset the income or gain
previously allocated to such Holder under this
Section 2.11(f).
7. Loss shall not be allocated to a Holder to the extent
that such allocation would cause a deficit in such
Holder's Capital Account (after reduction to reflect
the items described in Treasury Regulations Section
1.704-1(b)(2)(ii)(d)(4), (5) and (6)) to exceed the
sum of such Holder's shares of Trust Minimum Gain and
Holder Nonrecourse Debt Minimum Gain. Any
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loss in excess of that limitation shall be allocated
to all the Holders in accordance with their
respective Percentage Interests. After the occurrence
of an allocation of loss to a Holder in accordance
with this Section 2.11(g), to the extent permitted by
Treasury Regulations Section 1.704-1(b), profit shall
be allocated to such Holder in an amount necessary to
offset the loss previously allocated to such Holder
under this Section 2.11(g).
8. If a Holder transfers any part or all of its
Holdership Interest and the transferee is admitted as
provided herein (a "Transferee Holder"), the
distributive shares of the various items of profit
and loss allocable among the Holders during such
Taxable Year shall be allocated between the
transferor and the Transferee Holder (at the election
of the Holders (including the transferor, but
excluding the Transferee Holder)) either (i) as if
the Taxable Year had ended on the date of the
transfer or (ii) based on the number of days of such
Taxable Year that each was a Holder without regard to
the results of Trust activities in the respective
portions of such Taxable Year in which the transferor
and Transferee Holder were Holders.
9. "Profit" and "loss" and any items of income, gain,
expense or loss referred to in this Section 2.11
shall be determined in accordance with federal income
tax accounting principles as modified by Treasury
Regulations Section 1.704-1(b)(2)(iv), except that
profits and losses shall not include items of income,
gain, and expense that are specially allocated
pursuant to Sections 2.11(e), 2.11(f) or 2.11(g)
hereof. All allocations of income, profits, gains,
expenses, and losses (and all items contained
therein) for federal income tax purposes shall be
identical to all allocations of such items set forth
in this Section 2.11, except as otherwise required by
Section 704(c) of the Code and Section 1.704-1(b)(4)
of the Treasury Regulations.
10. The taxable year of the Trust (the "Taxable Year")
shall be the calendar year or such other taxable year
as may be required by Section 706(b) of the Code.
11. At the Trust's expense, the Owner Trustee shall (i)
prepare, or cause to be prepared, and file such tax
returns relating to the Trust (including a
partnership information return, IRS Form 1065) as are
required by applicable federal, state, and local law,
(ii) cause such returns to be signed in the manner
required by law, (iii) make such elections as may
from time
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to time be required or appropriate under any
applicable law so as to maintain the Trust's
classification as a partnership for tax purposes,
(iv) prepare and deliver, or cause to be prepared and
delivered, to the Holders, no later than [___] days
after the close of each Taxable Year, a Schedule K-1,
a copy of the Trust's informational tax return (IRS
Form 1065), and such other reports (collectively, the
"Annual Tax Reports") setting forth in sufficient
detail all such information and data with respect to
the transactions effected by or involving the Trust
during such Taxable Year as shall enable the each
Holder to prepare its federal, state, and local
income tax returns in accordance with the laws then
prevailing, and (v) collect, or cause to be
collected, any withholding tax as described in
Section 5.2(c) with respect to income or
distributions to Certificateholders.
12. The Holders shall designate a Holder as the tax
matters partner for the Trust within the meaning of
Section 6231(a)(7) of the Code (the Tax Matters
Partner"), and shall notify the Indenture Trustee,
the Manager (as defined in Section 5.2(d)) and the
Owner Trustee in writing of the name and address of
such Tax Matters Partner. The Tax Matters Partner
shall have the right and obligation to take all
actions authorized and required, respectively, by the
Code for the Tax Matters Partner. The Tax Matters
Partner shall have the right to retain professional
assistance in respect of any audit or controversy
proceeding initiated with respect to the Trust by the
Internal Revenue Service or any state or local taxing
authority, and all expenses and fees incurred by the
Tax Matters Partner on behalf of the Trust shall
constitute expenses of the Trust. In the event the
Tax Matters Partner receives notice of a final
partnership adjustment under Section 6223(a)(2) of
the Code, the Tax Matters Partner shall either (i)
file a court petition for judicial review of such
adjustment within the period provided under Section
6226(a) of the Code, a copy of which petition shall
be mailed to all other Holders on the date such
petition is filed, or (ii) mail a written notice to
all other Holders, within such period, that describes
the Tax Matters Partner's reasons for determining not
to file such a petition.
13. Except as otherwise provided in this Section 2.11,
the Holders shall instruct the Owner Trustee as to
whether to make any available election under the Code
or any applicable state or local tax law on behalf of
the Trust. Notwithstanding the foregoing, any Holder
may request that the Owner Trustee make an election
under section 754 of the Code; provided that the
requesting Holder shall agree to bear the cost of
preparing such election and any additional accounting
expenses of the Trust incurred as a result of such
election.
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ARTICLE III
CERTIFICATES AND TRANSFER OF INTERESTS
A. Initial Ownership.
Upon the formation of the Trust by the contribution by the Company
pursuant to Section 2.5 and until the issuance of the Certificates, the Company
shall be the sole beneficiary of the Trust.
B. The Certificates.
The Certificates shall be issued without a principal amount and shall
evidence beneficial ownership interests in the Trust. The Certificates shall be
printed, lithographed, or engraved or may be produced in any other manner as is
reasonably acceptable to the Owner Trustee, as evidenced by its execution
thereof. The Certificates shall be executed on behalf of the Trust by manual or
facsimile signature of a Trust Officer of the Owner Trustee. Certificates
bearing the manual or facsimile signatures of individuals who were, at the time
when such signatures shall have been affixed, authorized to sign on behalf of
the Trust, shall be valid, notwithstanding that such individuals or any of them
shall have ceased to be so authorized prior to the authentication and delivery
of such Certificates or did not hold such offices at the date of authentication
and delivery of such Certificates.
A transferee of a Certificate shall become a Certificateholder, and
shall be entitled to the rights and subject to the obligations of a
Certificateholder hereunder upon such transferee's acceptance of a Certificate
duly registered in such transferee's name pursuant to Section 3.4.
C. Execution, Authentication and Delivery of Trust Certificates.
Concurrently with the initial transfer of the Mortgage Loans to the
Trust pursuant to Article XI hereof, the Owner Trustee shall cause the
Certificates, representing [100%] of the Percentage Interests of the Trust
Interest, to be executed on behalf of the Trust, authenticated and delivered to
_________________, as the Company's designee. No Certificate shall entitle its
holder to any benefit under this Agreement, or shall 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 Owner Trustee's authenticating agent, by manual or facsimile signature;
such authentication shall constitute conclusive evidence that such Certificate
shall have been duly authenticated and delivered hereunder. All Certificates
shall be dated the date of their authentication.
D. Registration of Transfer and Exchange of Trust Certificates.
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The Certificate Registrar shall keep or cause to be kept, at the office
or agency maintained pursuant to Section 3.8, a Certificate Register in which,
subject to such reasonable regulations as it may prescribe, the Owner Trustee
shall provide for the registration of Certificates and of transfers and
exchanges of Certificates as herein provided. The Owner Trustee shall be the
initial Certificate Registrar.
Upon surrender for registration of transfer of any Certificate at the
office or agency maintained pursuant to Section 3.8, the Owner Trustee shall
execute, authenticate and deliver (or shall cause its authenticating agent to
authenticate and deliver), in the name of the designated transferee or
transferees, one or more new Certificates of a like Percentage Interest 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 a like Percentage Interest upon surrender of the Certificates to
be exchanged at the office or agency maintained pursuant to Section 3.8.
Every Certificate presented or surrendered for registration of transfer
or exchange shall be accompanied by a written instrument of transfer in form
satisfactory to the Owner Trustee and the Certificate Registrar duly executed by
the Certificateholder or his attorney duly authorized in writing. In addition,
each Certificate presented or surrendered for registration of transfer and
exchange must be accompanied by a letter from the Prospective Holder certifying
as to the representations set forth in Section 3.11(a), (b), and (c). Each
Certificate surrendered for registration of transfer or exchange shall be
canceled and disposed of by the Owner Trustee in accordance with its customary
practice.
No service charge shall be made for any registration of transfer or
exchange of Certificates, but the Owner Trustee or the Certificate Registrar may
require payment of a sum sufficient to cover any tax or governmental charge that
may be imposed in connection with any transfer or exchange of Certificates.
The preceding provisions of this Section notwithstanding, the Owner
Trustee shall not make and the Certificate Registrar shall not register transfer
or exchanges of Certificates for a period of [___] days preceding the Payment
Date with respect to the Certificates.
E. Mutilated, Destroyed, Lost or Stolen Certificates.
If (a) any mutilated Certificate shall be surrendered to the
Certificate Registrar, or if the Certificate Registrar shall receive evidence to
its satisfaction of the destruction, loss, or theft of any Certificate and (b)
there shall be delivered to the Certificate Registrar and the Owner Trustee such
security or indemnity as may be required by them to save each of them harmless,
then in the absence of notice that such Certificate shall have been acquired by
a bona fide purchaser, the Owner Trustee on behalf of the Trust shall execute
and the Owner Trustee, or the Owner Trustee's authenticating agent, shall
authenticate and deliver, in exchange for or in lieu of any
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such mutilated, destroyed, lost, or stolen Certificate, a new Certificate of
like Percentage Interest. 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.
F. Persons Deemed Owners.
Each person by virtue of becoming a Certificateholder in accordance
with this Agreement shall be deemed to be bound by the terms of this Agreement.
Prior to due presentation of a Certificate for registration of transfer, the
Owner Trustee or the Certificate Registrar may treat the Person in whose name
any Certificate shall be registered in the Certificate Register as the owner of
such Certificate for the purpose of receiving distributions pursuant to Section
5.2 and for all other purposes whatsoever, and neither the Owner Trustee nor the
Certificate Registrar shall be bound by any notice to the contrary.
G. Access to List of Holders' Names and Addresses.
The Owner Trustee shall furnish or cause to be furnished to the
Servicer, the Company and the Trust Paying Agent immediately prior to each
Payment Date, a list of the names and addresses of the Certificateholders as of
the most recent Record Date. If three or more Certificateholders or one or more
Holders of Certificates, together evidencing Percentage Interests totaling not
less than [25%], apply in writing to the Owner Trustee, and such application
states that the applicants desire to communicate with other Certificateholders
with respect to their rights under this Agreement or under the Certificates and
such application is accompanied by a copy of the communication that such
applicants propose to transmit, then the Owner Trustee shall, within five
Business Days after the receipt of such application, afford such applicants
access during normal business hours to the current list of Certificateholders.
Each Certificateholder, by receiving and holding a Certificate, shall be deemed
to have agreed not to hold any of the Company, 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.
H. Maintenance of Office or Agency.
The Owner Trustee shall maintain an office or offices or agency or
agencies where Certificates may be surrendered for registration of transfer or
exchange and where notices and demands to or upon the Owner Trustee in respect
of the Certificates and the Basic Documents may be served. The Owner Trustee
initially designates ________________________ as its
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principal corporate trust office for such purposes. The Owner Trustee shall give
prompt written notice to the Company and to the Certificateholders of any change
in the location of the Certificate Register or any such office or agency.
I. Appointment of Trust Paying Agent.
The Owner Trustee hereby appoints ___________________, as Trust Paying
Agent under this Agreement. The Trust Paying Agent shall make distributions to
Certificateholders from the Certificate Distribution Account pursuant to Section
5.2 and shall report to the Owner Trustee on the Payment Date via facsimile
transmission of a distribution statement the amounts of such distributions to
the Certificateholders. The Trust Paying Agent shall have the revocable power to
withdraw funds from the Certificate Distribution Account for the purpose of
making the distributions referred to above. In the event that __________, shall
no longer be the Trust Paying Agent hereunder, the Owner Trustee shall appoint a
successor to act as Trust Paying Agent (which shall be a bank or trust company)
acceptable to the Certificateholders and the Bond Insurer. The Owner Trustee
shall cause such successor Trust Paying Agent or any additional Trust Paying
Agent appointed by the Owner Trustee to execute and deliver to the Owner Trustee
an instrument in which such successor Trust Paying Agent or additional Trust
Paying Agent shall agree with the Owner Trustee that as Trust Paying Agent, such
successor Trust Paying Agent or additional Trust Paying Agent will hold all
sums, if any, held by it for payment to the Certificateholders in trust for the
benefit of the Certificateholders entitled thereto until such sums shall be paid
to such Certificateholders. After one year from the date of receipt, the Trust
Paying Agent shall promptly return all unclaimed funds to the Owner Trustee, and
upon removal of a Trust Paying Agent, such Trust Paying Agent shall also return
all funds in its possession to the Owner Trustee. The provisions of Sections
7.1, 7.3(b), 7.4, 8.1, and 10.2 as to resignations, shall apply to the Trust
Paying Agent to the same extent as if it were named therein and, to the extent
applicable, to any other paying agent appointed hereunder. Any reference in this
Agreement to the Trust Paying Agent shall include any co-paying agent unless the
context requires otherwise.
J. Restrictions on Transfer of Certificates.
1. Each prospective purchaser and any subsequent
transferee of a Certificate (each, a "Prospective
Holder"), other than ____________________, shall
represent and warrant, in writing, to the Owner
Trustee and the Certificate Registrar and any of
their respective successors that:
a. Such Person is (A) a "qualified
institutional buyer" as defined in Rule 144A
under the Securities Act of 1933, as amended
(the "Securities Act"), and is aware that
the seller of the Certificate may be relying
on the exemption from the registration
requirements of
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the Securities Act provided by Rule 144A and
is acquiring such Certificate for its own
account or for the account of one or more
qualified institutional buyers for whom it
is authorized to act, or (B) a Person
involved in the organization or operation of
the Trust or an affiliate of such Person
within the meaning of Rule 3a-7 of the
Investment Company Act of 1940, as amended
(including, but not limited to,
_____________________.
b. Such Person understands that the
Certificates have not been and will not be
registered under the Securities Act and may
be offered, sold, pledged, or otherwise
transferred only to a person whom the seller
reasonably believes is (C) a qualified
institutional buyer or (D) a Person involved
in the organization or operation of the
Trust or an affiliate of such Person, in a
transaction meeting the requirements of Rule
144A under the Securities Act and in
accordance with any applicable securities
laws of any state of the United States.
c. Such Person understands that the
Certificates bear a legend to the following
effect:
"THIS CERTIFICATE HAS NOT BEEN AND WILL NOT BE REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR
ANY STATE SECURITIES LAWS. THIS CERTIFICATE MAY BE DIRECTLY OR
INDIRECTLY OFFERED OR SOLD OR OTHERWISE DISPOSED OF (INCLUDING
PLEDGED) BY THE HOLDER HEREOF ONLY TO (I) A "QUALIFIED
INSTITUTIONAL BUYER" AS DEFINED IN RULE 144A UNDER THE ACT, IN
A TRANSACTION THAT IS REGISTERED UNDER THE ACT AND APPLICABLE
STATE SECURITIES LAWS OR THAT IS EXEMPT FROM THE REGISTRATION
REQUIREMENTS OF THE ACT PURSUANT TO RULE 144A OR (II) A PERSON
INVOLVED IN THE ORGANIZATION OR OPERATION OF THE TRUST OR AN
AFFILIATE OF SUCH A PERSON WITHIN THE MEANING OF RULE 3a-7 OF
THE INVESTMENT COMPANY ACT OF 1940, AS AMENDED (INCLUDING, BUT
NOT LIMITED TO, _______________________________ IN A
TRANSACTION THAT IS REGISTERED UNDER THE ACT AND APPLICABLE
STATE SECURITIES LAWS OR THAT IS EXEMPT FROM THE REGISTRATION
REQUIREMENTS OF THE ACT AND SUCH
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LAWS. NO PERSON IS OBLIGATED TO REGISTER THIS CERTIFICATE
UNDER THE ACT OR ANY STATE SECURITIES LAWS."
2. By its acceptance of a Certificate, each Prospective
Holder agrees and acknowledges that no legal or
beneficial interest in all or any portion of any
Certificate may be transferred directly or indirectly
to an entity that holds residual securities as
nominee to facilitate the clearance and settlement of
such securities through electronic book-entry changes
in Accounts of participating organizations (a
"Book-Entry Nominee") and any such purported transfer
shall be void and have no effect.
3. No transfer of this certificate or any beneficial
interest therein shall be made to any person unless
the Owner Trustee has received a certificate from the
Transferee to the effect that such transferee (i) is
not a person which is an employee benefit plan,
trust, or account subject to Title I of the Employee
Retirement Income Security Act of 1974, as amended
("ERISA") or Section 4975 of the Code or a
governmental plan, defined in Section 3(32) of ERISA
subject to any federal, state or local law which is,
to a material extent, similar to the foregoing
provisions of ERISA or the Code (any such person
being a "plan") and (ii) is not an entity, including
an insurance company separate account or general
account, whose underlying assets include plan assets
by reason of a plan's investment in the entity.
4. The Owner Trustee shall not execute, and shall not
countersign and deliver, a Certificate in connection
with any transfer thereof unless the transferor shall
have provided to the Owner Trustee a certificate,
substantially in the form attached as Exhibit C to
this --------- Agreement, signed by the transferee,
which certificate shall contain the consent of the
transferee to any amendments of this Agreement as may
be required to effectuate further the foregoing
restrictions on transfer of the Certificates to
Book-Entry Nominees, and an agreement by the
transferee that it will not transfer a Certificate
without providing to the Owner Trustee a certificate
substantially in the form attached as Exhibit C to
this Agreement. ---------
5. The Certificates shall bear an additional legend
referring to the restrictions contained in paragraph
(b) above.
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ARTICLE IV
ACTIONS BY OWNER TRUSTEE
A. Prior Notice to Holders with Respect to Certain Matters.
With respect to the following matters, the Owner Trustee shall not take
action, and the Certificateholders shall not direct the Owner Trustee to take
any action, unless at least [__ days] before the taking of such action, the
Owner Trustee shall have notified the Certificateholders and the Bond Insurer in
writing of the proposed action and neither the Certificateholders nor the Bond
Insurer shall have notified the Owner Trustee in writing prior to the [___ day]
after such notice is given that such Certificateholders and/or the Bond Insurer
have withheld consent or the Certificateholders have provided alternative
direction (any direction by the Certificateholders shall require the prior
consent of the Bond Insurer):
1. the initiation of any claim or lawsuit by the Trust
(except claims or lawsuits brought in connection with
the collection of the Mortgage Loans) and the
compromise of any action, claim or lawsuit brought by
or against the Trust (except with respect to the
aforementioned claims or lawsuits for collection of
the Mortgage Loans);
2. the election by the Trust to file an amendment to the
Certificate of Trust (unless such amendment is
required to be filed under the Business Trust
Statute);
3. the amendment or other change to this Agreement or
any Basic Document in circumstances where the consent
of any Holder or the Bond Insurer is required;
4. the amendment or other change to this Agreement or
any Basic Document in circumstances where the consent
of any Holder or the Bond Insurer is not required and
such amendment materially adversely affects the
interest of the Certificateholders;
5. the appointment pursuant to the Indenture of a
successor Bond Registrar, Trust Paying Agent, or
Indenture Trustee or pursuant to this Agreement of a
successor Certificate Registrar or Trust Paying
Agent, or the consent to the assignment by the Bond
Registrar, Paying Agent, or Indenture Trustee
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or Certificate Registrar or Trust Paying Agent of its
obligations under the Indenture or this Agreement, as
applicable.
6. the consent to the calling or waiver of any default
of any Basic Document;
7. he consent to the assignment by the Indenture Trustee
or Servicer of their respective obligations under any
Basic Document;
8. except as provided in Article IX hereof, dissolve,
terminate or liquidate the Trust in whole or in part;
9. merge or consolidate the Trust with or into any other
entity, or convey or transfer all or substantially
all of the Trust's assets to any other entity;
10. cause the Trust to incur, assume or guaranty any
indebtedness other than as set forth in this
Agreement or the Basic Documents;
11. do any act that conflicts with any other Basic
Document;
12. do any act which would make it impossible to carry on
the ordinary business of the Trust as described in
Section 2.3 hereof;
13. confess a judgment against the Trust;
14. possess Trust assets, or assign the Trust's right to
property, for other than a Trust purpose;
15. cause the Trust to lend any funds to any entity; or
16. change the Trust's purpose and powers from those set
forth in this Trust Agreement.
In addition the Trust shall not commingle its assets with those of any
other entity. The Trust shall maintain its financial and accounting books and
records separate from those of any other entity. Except as expressly set forth
herein, the Trust shall pay its indebtedness, operating
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expenses, and liabilities from its own funds, and the Trust shall not pay the
indebtedness, operating expenses, and liabilities of any other entity. The Trust
shall maintain appropriate minutes or other records of all appropriate actions
and shall maintain its office separate from the offices of the Company and
________________.
The Owner Trustee shall not have the power, except upon the direction
of the Certificateholders with the consent of the Bond Insurer, and to the
extent otherwise consistent with the Basic Documents, to (i) remove or replace
the Servicer or the Indenture Trustee, (ii) institute proceedings to have the
Trust declared or adjudicated a bankruptcy or insolvent, (iii) consent to the
institution of bankruptcy or insolvency proceedings against the Trust, (iv) file
a petition or consent to a petition seeking reorganization or relief on behalf
of the Trust under any applicable federal or state law relating to bankruptcy,
(v) consent to the appointment of a receiver, liquidator, assignee, trustee,
sequestrator, or any similar official of the Trust or a substantial portion of
the property of the Trust, (vi) make any assignment for the benefit of the
Trust's creditors, (vii) cause the Trust to admit in writing its inability to
pay its debts generally as they become due, and (viii) take any action, or cause
the Trust to take any action, in furtherance of any of the foregoing (any of the
above, a "Bankruptcy Action"). So long as the Indenture and the Insurance
Agreement remain in effect and no Bond Insurer Default exists, no
Certificateholder shall have the power to take, and shall not take, any
Bankruptcy Action with respect to the Trust or direct the Owner Trustee to take
any Bankruptcy Action with respect to the Trust.
B. Action by Holders with Respect to Bankruptcy.
The Owner Trustee shall not have the power to commence a voluntary
proceeding in bankruptcy relating to the Trust without the consent and approval
of the Bond Insurer, the unanimous prior approval of all Certificateholders and
the Bond Insurer and the delivery to the Owner Trustee by each such
Certificateholder of a certification that such Certificateholder reasonably
believes that the Trust is insolvent.
C. Restrictions on Holders' Power.
The Certificateholders shall not direct the Owner Trustee to take or
refrain from taking any action if such action or inaction would be contrary to
any obligation of the Trust or the Owner Trustee under this Agreement or any of
the Basic Documents or would be contrary to Section 2.3 nor shall the Owner
Trustee be obligated to follow any such direction, if given.
D. Majority Control.
Except as expressly provided herein, any action that may be taken by
the Certificateholders under this Agreement may be taken by the Holders of
Certificates evidencing more than [50%] of the Percentage Interest in the Trust
Interest and such action shall be binding
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upon all Certificateholders. Except as expressly provided herein, any written
notice of the Certificateholders delivered pursuant to this Agreement shall be
effective if signed by Holders of Certificates evidencing more than [50%] of the
Percentage Interest in the Trust Interest at the time of the delivery of such
notice and such action shall be binding upon all Certificateholders.
ARTICLE V
APPLICATION OF TRUST FUNDS; CERTAIN DUTIES
A. Establishment of Certificate Distribution Account.
The Owner Trustee shall cause the Trust Paying Agent, for the benefit
of the Certificateholders, to establish and maintain with
___________________________, for the benefit of the Owner Trustee one or more
Accounts that while the Trust Paying Agent holds such Account shall be entitled
"Certificate Distribution Account, _________________________, as Trust Paying
Agent, in trust for the Holders of Certificates evidencing beneficial interests
in Union Planters Home Equity Trust 20__-__." Funds shall be deposited in the
Certificate Distribution Account as required by the Indenture or, following
satisfaction and release of the Indenture, by the Servicing Agreement.
All of the right, title, and interest of the Owner Trustee in all funds
on deposit from time to time in the Certificate Distribution Account and in all
proceeds thereof shall be held for the benefit of the Certificateholders, the
Bond Insurer, and such other persons entitled to distributions therefrom. Except
as otherwise expressly provided herein, the Certificate Distribution Account
shall be under the sole dominion and control of the Owner Trustee for the
benefit of the Certificateholders and the Bond Insurer.
B. Application of Trust Funds.
1. On each Payment Date, the Trust Paying Agent shall
distribute to the Certificateholders, on the basis of
their respective Percentage Interests, all amounts
then on deposit in the Certificate Distribution
Account.
2. On each Payment Date, the Trust Paying Agent shall
send to Certificateholders the statement provided to
the Owner Trustee by the Indenture Trustee pursuant
to Section 2.08(d) of the Indenture with respect to
such Payment Date. If the Trust Paying Agent is an
entity other than the Indenture Trustee, the Owner
Trustee shall provide a copy of such statement to the
Trust Paying Agent to enable it to perform its duties
under this Section 5.2(b).
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3. In the event that any withholding tax is imposed
under federal, state, or local tax on the Trust's
payment (or allocations of income) to a
Certificateholder, such tax shall reduce the amount
otherwise distributable to such Certificateholder in
accordance with this Section. The Owner Trustee, and
the Trust Paying Agent on its behalf, is hereby
authorized and directed to retain in the Certificate
Distribution Account from amounts otherwise
distributable to the Certificateholders sufficient
funds for the payment of any tax that is legally owed
by the Trust (but such authorization shall not
prevent the Owner Trustee from contesting any such
tax in appropriate proceedings, and withholding
payment of such tax, if permitted by law, pending the
outcome of such proceedings). The Certificate
Registrar will provide the Trust Paying Agent with a
statement indicating the amount of any such
withholding tax. 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 Trust and remitted
to the appropriate taxing authority from the
Certificate Distribution Account at the direction of
the Owner Trustee or the Trust Paying Agent on its
behalf. If there is a possibility that withholding
tax is payable with respect to a distribution (such
as a distribution to a Certificateholder who is a
Non-U.S. Person), the Trust Paying Agent may in its
sole discretion withhold such amounts in accordance
with this paragraph (c). In the event that a
Certificateholder wishes to apply for a refund of any
such withholding tax, the Owner Trustee and the Trust
Paying Agent shall reasonably cooperate with such
Certificateholder in making such claim so long as
such Certificateholder agrees to reimburse the Owner
Trustee for any out-of-pocket expenses incurred.
4. Notwithstanding anything to the contrary herein, at
any time after the Indenture is no longer in effect
but while this Agreement remains in effect, the Bond
Administrator shall be entitled to a fee on each
Payment Date equal to the Indenture Trustee Fee that
would have been payable to the Indenture Trustee on
such Payment Date if the Indenture were still in
effect. Such fee shall be distributed to the Bond
Administrator from funds in the Certificate
Distribution Account prior to distribution of any
such funds to Certificateholders. Also, in such
event, the Servicer shall provide the same
information to the Bond Administrator that it would
have provided to the Indenture Trustee pursuant to
the Servicing Agreement, as well as any other
information concerning the Mortgage Loans as may be
reasonably requested by the Bond Administrator to
enable the Bond Administrator to perform its
obligations hereunder. On each such Payment Date, the
Trust Paying Agent shall mail to each
Certificateholder
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a statement detailing the amount remitted to the
Trust Paying Agent by the Servicer on the related
Deposit Date and setting forth the amount of the
Monthly Servicing Fee and fees paid to the Bond
Administrator with respect to such Payment Date, and
the aggregate amount distributed to
Certificateholders on such Payment Date.
C. Method of Payment.
Distributions required to be made to Certificateholders on any Payment
Date shall be made to each Certificateholder of record on the preceding Record
Date either by wire transfer, in immediately available funds, to the account of
such Holder at a bank or other entity having appropriate facilities therefor, if
such Certificateholder shall have provided to the Trust Paying Agent 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 of such Holder
appearing in the Certificate Register.
D. Segregation of Moneys; No Interest.
Subject to Sections 5.1 and 5.2, moneys received by the Trust Paying
Agent hereunder and deposited into the Certificate Distribution Account will be
segregated except to the extent required otherwise by law and, if the Holders of
more than [50%] of the Certificates so direct, shall be invested in Permitted
Investments maturing no later than one Business Day prior to the related Payment
Date at the direction of such Certificateholders. The Trust Paying Agent shall
not be liable for payment of any interest or losses in respect of such moneys.
Investment gains shall be for the account of and paid to the Certificateholders.
ARTICLE VI
AUTHORITY AND DUTIES OF OWNER TRUSTEE
A. General Authority.
The Owner Trustee is authorized and directed to execute and deliver or
cause to be executed and delivered the Bonds, the Certificates, and the Basic
Documents to which the Trust is to be a party and each certificate or other
document attached as an exhibit to or contemplated by the Basic Documents to
which the Trust is to be a party and any amendment or other agreement or
instrument described in Article III, in each case, in such form as the Owner
Trustee shall approve, as evidenced conclusively by the Owner Trustee's
execution thereof. In addition, the Owner Trustee is authorized and directed, on
behalf of the Trust, to execute and deliver to the Authenticating Agent, the
Issuer Request and the Issuer Order referred to in Section 2.11 of the
Indenture, in such form as the Company shall approve, as evidenced conclusively
by the Owner Trustee's or the Company's execution thereof, directly to the
Authenticating Agent to
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authenticate and deliver Bonds in the aggregate principal amount of
$___________. In addition to the foregoing, the Owner Trustee is authorized, but
shall not be obligated, to take all actions required of the Trust, pursuant to
the Basic Documents.
B. General Duties.
It shall be the duty of the Owner Trustee:
1. To discharge (or cause to be discharged) all of its
responsibilities pursuant to the terms of this
Agreement and the Basic Documents to which the Trust
is a party and to administer the Trust in the
interest of the Certificateholders, subject to the
Basic Documents and in accordance with the provisions
of this Agreement; the Owner Trustee shall not be
responsible for taking any action with respect to the
Indenture or any other of the Basic Documents unless
a Responsible Office of the Owner Trustee has actual
knowledge of the facts which require such action or
has received written notice of the need to take such
action; the Owner Trustee shall not be responsible
for any matter regarding the Investment Company Act
of 1940, as amended (or any successor statute) or the
rules or regulations thereunder; and
2. To obtain and preserve the Issuer's qualification to
do business in each jurisdiction in which such
qualification is or shall be necessary to protect the
validity and enforceability of the Indenture, the
Bonds, the Mortgage Loans, and each other instrument
and agreement included in the Trust Estate.
C. Action upon Instruction.
1. Subject to Article IV and in accordance with the
terms of the Basic Documents, the Certificateholders
may by written instruction direct the Owner Trustee
in the management of the Trust but only to the extent
consistent with the limited purpose of the Trust.
Such direction may be exercised at anytime by written
instruction of the Certificateholders pursuant to
Article IV. Without limiting the generality of the
foregoing, the Owner Trustee shall act as directed by
the Certificateholders in connection with Bond
redemptions requested by the Certificateholders, and
shall take all actions and deliver all documents that
the Trust is required to take and deliver in
accordance with Section 4.01 and Article X
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of the Indenture in order to effect any redemption
requested by the Certificateholders.
2. The Owner Trustee shall not be required to take any
action hereunder or under any Basic Document if the
Owner Trustee shall have reasonably determined, or
shall have been advised by counsel, that such action
is likely to result in liability on the part of the
Owner Trustee or is contrary to the terms hereof or
of any Basic Document or is otherwise contrary to
law.
3. Whenever the Owner Trustee is unable to decide
between alternative courses of action permitted or
required by the terms of this Agreement or under any
Basic Document, the Owner Trustee shall promptly give
notice (in such form as shall be appropriate under
the circumstances) to the Certificateholders and the
Bond Insurer requesting instruction from the
Certificateholders as to the course of action to be
adopted, and to the extent the Owner Trustee acts in
good faith in accordance with any written instruction
of the Certificateholders received, the Owner Trustee
shall not be liable on Account of such action to any
Person. If the Owner Trustee shall not have received
appropriate instruction within [___ days] of such
notice (or within such shorter period of time as
reasonably may be specified in such notice or may be
necessary under the circumstances) it may, but shall
be under no duty to, take or refrain from taking such
action, not inconsistent with this Agreement or the
Basic Documents, as it shall deem to be in the best
interests of the Certificateholders, and shall have
no liability to any Person for such action or
inaction.
4. In the event that the Owner Trustee is unsure as to
the application of any provision of this Agreement or
any Basic Document or any such provision is ambiguous
as to its application, or is, or appears to be, in
conflict with any other applicable provision, or in
the event that this Agreement permits any
determination by the Owner Trustee or is silent or is
incomplete as to the course of action that the Owner
Trustee is required to take with respect to a
particular set of facts, the Owner Trustee may give
notice (in such form as shall be appropriate under
the circumstances) to the Certificateholders
requesting instruction and, to the extent that the
Owner Trustee acts or refrains from acting in good
faith in accordance with any such instruction
received, the Owner Trustee shall not be liable, on
account of such action or inaction, to any Person. If
the Owner Trustee shall not have received appropriate
instruction within [___ days] of such notice (or
within such shorter period of time as reasonably may
be
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specified in such notice or may be necessary under
the circumstances) it may, but shall be under no duty
to, take or refrain from taking such action, not
inconsistent with this Agreement or the Basic
Documents, as it shall deem to be in the best
interests of the Certificateholders, and shall have
no liability to any Person for such action or
inaction.
D. No Duties Except as Specified in this Agreement, the Basic
Documents or Any Instructions.
The Owner Trustee shall not have any duty or obligation to manage, make
any payment with respect to, register, record, sell, dispose of, or otherwise
deal with the Owner Trust Estate, or to otherwise take or refrain from taking
any action under, or in connection with, any document contemplated hereby to
which the Owner Trustee is a party, except as expressly provided by the terms of
this Agreement, any Basic Document, or in any document or written instruction
received by the Owner Trustee pursuant to Section 6.3; and no implied duties or
obligations shall be read into this Agreement or any Basic Document against the
Owner Trustee. The Owner Trustee shall have no responsibility for filing any
financing or continuation statement in any public office at any time or to
otherwise perfect or maintain the perfection of any security interest or lien
granted to it hereunder or to record this Agreement or any Basic Document. The
Owner Trustee nevertheless agrees that it will, at its own cost and expense,
promptly take all action as may be necessary to discharge any liens on any part
of the Owner Trust Estate that result from actions by, or claims against, the
Owner Trustee that are not related to the ownership or the administration of the
Owner Trust Estate.
E. No Action Except Under Specified Documents or Instructions.
The Owner Trustee shall not manage, control, use, sell, dispose of, or
otherwise deal with any part of the Owner Trust Estate except (i) in accordance
with the powers granted to and the authority conferred upon the Owner Trustee
pursuant to this Agreement, (ii) in accordance with the Basic Documents, and
(iii) in accordance with any document or instruction delivered to the Owner
Trustee pursuant to Section 6.3.
F. Restrictions.
The Owner Trustee shall not take any action (a) that is inconsistent
with the purposes of the Trust set forth in Section 2.3 or (b) that, to the
actual knowledge of the Owner Trustee, would result in the Trust's becoming
taxable as a corporation for Federal income tax purposes. The Certificateholders
shall not direct the Owner Trustee to take action that would violate the
provisions of this Section.
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ARTICLE VII
CONCERNING THE OWNER TRUSTEE
A. Acceptance of Trusts and Duties.
The Owner Trustee accepts the trusts hereby created and agrees to
perform its duties hereunder with respect to such trusts but only upon the terms
of this Agreement and the Basic Documents. The Owner Trustee also agrees to
disburse all moneys actually received by it constituting part of the Owner Trust
Estate upon the terms of the Basic Documents and this Agreement. The Owner
Trustee shall not be answerable or accountable hereunder or under any Basic
Document under any circumstances, except (i) for its own willful misconduct or
negligence or (ii) in the case of the inaccuracy of any representation or
warranty contained in Section 7.3 expressly made by the Owner Trustee. In
particular, but not by way of limitation (and subject to the exceptions set
forth in the preceding sentence):
1. the Owner Trustee shall not be liable for any error
of judgment made by a responsible officer of the
Owner Trustee;
2. the Owner Trustee shall not be liable with respect to
any action taken or omitted to be taken by it in
accordance with the instructions of the
Certificateholders;
3. no provision of this Agreement or any Basic Document
shall require the Owner Trustee to expend or risk
funds or otherwise incur any financial liability in
the performance of any of its rights or powers
hereunder or under any Basic Document if the Owner
Trustee shall have reasonable grounds for believing
that repayment of such funds or adequate indemnity
against such risk or liability is not reasonably
assured or provided to it;
4. under no circumstances shall the Owner Trustee be
liable for indebtedness evidenced by or arising under
any of the Basic Documents, including the principal
of and interest on the Bonds;
5. the Owner Trustee shall not be responsible for or in
respect of the validity or sufficiency of this
Agreement or for the due execution hereof by the
Company or for the form, character, genuineness,
sufficiency, value, or validity of any of the Owner
Trust Estate or for or in respect of the validity or
sufficiency of the Basic Documents, other than the
certificate of
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authentication on the Certificates, and the Owner
Trustee shall in no event assume or incur any
liability, duty, or obligation to any Bondholder or
to any Certificateholder, other than as expressly
provided for herein and in the Basic Documents;
6. the Owner Trustee shall not be liable for the default
or misconduct of the Seller, the Company, the
Indenture Trustee or the Servicer under any of the
Basic Documents or otherwise and the Owner Trustee
shall have no obligation or liability to perform the
obligations of the Trust under this Agreement or the
Basic Documents that are required to be performed by
the Indenture Trustee under the Indenture or the
Servicer under the Servicing Agreement; and
7. the Owner Trustee shall be under no obligation to
exercise any of the rights or powers vested in it by
this Agreement, or to institute, conduct, or defend
any litigation under this Agreement or otherwise or
in relation to this Agreement or any Basic Document,
at the request, order or direction of any of the
Certificateholders, unless such Certificateholders
have offered to the Owner Trustee security or
indemnity satisfactory to it against the costs,
expenses, and liabilities that may be incurred by the
Owner Trustee therein or thereby. The right of the
Owner Trustee to perform any discretionary act
enumerated in this Agreement or in any Basic Document
shall not be construed as a duty, and the Owner
Trustee shall not be answerable for other than its
gross negligence or willful misconduct in the
performance of any such act.
B. Furnishing of Documents.
The Owner Trustee shall furnish to the Certificateholders promptly upon
receipt of a written request therefor, duplicates or copies of all reports,
notices, requests, demands, certificates, financial statements, and any other
instruments furnished to the Owner Trustee under the Basic Documents. On behalf
of the Owner Trustee, the Company shall furnish to Bondholders promptly upon
written request therefor, copies of the Servicing Agreement and the Indenture.
C. Representations and Warranties.
1. The Owner Trustee hereby represents and warrants to
the Company for the benefit of the
Certificateholders, that:
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a. It is a [banking corporation] duly organized
and validly existing in good standing under
the laws of ________________. It has all
requisite corporate power and authority to
execute, deliver and perform its obligations
under this Agreement.
b. It has taken all corporate action necessary
to authorize the execution and delivery by
it of this Agreement, and this Agreement
will be executed and delivered by one of its
officers who is duly authorized to execute
and deliver this Agreement on its behalf.
c. Neither the execution nor the delivery by it
of this Agreement nor the consummation by it
of the transactions contemplated hereby nor
compliance by it with any of the terms or
provisions hereof will contravene any
Federal or [Delaware] law, governmental rule
or regulation governing the banking or trust
powers of the Owner Trustee or any judgment
or order binding on it, or constitute any
default under its charter documents or
by-laws.
d. The Trust Paying Agent hereby represents and
warrants to the Company and the Bond Insurer
for the benefit of the Certificateholders,
that:
e. It is a [banking association] duly organized
and validly existing in good standing under
the laws of the _______________. It has all
requisite corporate power and authority to
execute, deliver, and perform its
obligations under this Agreement.
f. 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.
g. Neither the execution nor the delivery by it
of this Agreement nor the consummation by it
of the transactions contemplated hereby nor
compliance by it with any of the terms or
provisions hereof will contravene any
Federal law, governmental rule, or
regulation governing the banking or trust
powers of the Trust Paying Agent or
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any judgment or order binding on it, or
constitute any default under its charter
documents or by-laws.
D. Reliance; Advice of Counsel.
1. The Owner Trustee shall incur no liability to anyone
in acting upon any signature, instrument, notice,
resolution, request, consent, order, certificate,
report, opinion, bond, or other document or paper
believed by it to be genuine and believed by it to be
signed by the proper party or parties. The Owner
Trustee may accept a certified copy of a resolution
of the board of directors or other governing body of
any corporate party as conclusive evidence that such
resolution has been duly adopted by such body and
that the same is in full force and effect. As to any
fact or matter the method of the determination of
which is not specifically prescribed herein, the
Owner Trustee may for all purposes hereof rely on a
certificate, signed by the president or any vice
president or by the treasurer or other authorized
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.
2. In the exercise or administration of the trusts
hereunder and in the performance of its duties and
obligations under this Agreement or the Basic
Documents, the Owner Trustee (i) may act directly or
through its agents or attorneys pursuant to
agreements entered into with any of them, and the
Owner Trustee shall not be liable for the conduct or
misconduct of such agents or attorneys if such agents
or attorneys shall have been selected by the Owner
Trustee with reasonable care, and (ii) may consult
with counsel, accountants, and other skilled persons
to be selected with reasonable care and employed by
it. The Owner Trustee shall not be liable for
anything done, suffered, or omitted in good faith by
it in accordance with the written opinion or advice
of any such counsel, Accountants, or other such
persons and not contrary to this Agreement or any
Basic Document.
E. Not Acting in Individual Capacity.
Except as provided in this Article VII, 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
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by this Agreement or any Basic Document shall look only to the Owner Trust
Estate for payment or satisfaction thereof.
F. Owner Trustee Not Liable for Certificates or Mortgage Loans.
The recitals contained herein and in the Certificates (other than the
signature and countersignature of the Owner Trustee on the Certificates) shall
be taken as the statements of the Company, and the Owner Trustee assumes no
responsibility for the correctness thereof. The Owner Trustee makes no
representations as to the validity or sufficiency of this Agreement, of any
Basic Document, of the Certificates (other than the signature and
countersignature of the Owner Trustee on the Certificates and as specified in
Section 7.3), of the Bonds, or of any Mortgage Loans or related documents. The
Owner Trustee shall at no time have any responsibility or liability for or with
respect to the legality, validity, and enforceability of any Mortgage Loan, or
the perfection and priority of any security interest created by any Mortgage
Loan or the maintenance of any such perfection and priority, or for or with
respect to the sufficiency of the Owner Trust Estate or its ability to generate
the payments to be distributed to Certificateholders under this Agreement or the
Bondholders under the Indenture, including, without limitation, the existence,
condition and ownership of any Mortgaged Property, the existence and
enforceability of any insurance thereon, the existence and contents of any
Mortgage Loan on any computer or other record thereof, the validity of the
assignment of any Mortgage Loan to the Trust or of any intervening assignment,
the completeness of any Mortgage Loan, the performance or enforcement of any
Mortgage Loan, the compliance by the Company or the Servicer with any warranty
or representation made under any Basic Document or in any related document or
the accuracy of any such warranty or representation, or any action of the
Indenture Trustee or the Servicer or any subservicer taken in the name of the
Owner Trustee.
G. Owner Trustee May Own Certificates and Bonds.
The Owner Trustee in its individual or any other capacity may become
the owner or pledgee of Certificates or Bonds and may deal with the Company, the
Indenture Trustee and the Servicer in banking transactions with the same rights
as it would have if it were not Owner Trustee.
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H. Licenses.
The Owner Trustee shall cause the Trust to use its best efforts to
obtain and maintain the effectiveness of any licenses required in connection
with this Agreement and the Basic Documents and the transactions contemplated
hereby and thereby until such time as the Trust shall terminate in accordance
with the terms hereof.
ARTICLE VIII
COMPENSATION OF OWNER TRUSTEE
A. Owner Trustee's Fees and Expenses.
The Owner Trustee shall receive as compensation for its services
hereunder such fees as have been separately agreed upon before the date hereof
between _____________________ and the Owner Trustee, and the Owner Trustee shall
be entitled to be reimbursed by ________________ for its other reasonable
expenses hereunder, including the reasonable compensation, expenses and
disbursements of such agents, representatives, experts, and counsel as the Owner
Trustee may employ in connection with the exercise and performance of its rights
and its duties hereunder. Such fees and expenses are as set forth on [Exhibit D]
hereto. The Certificateholders shall be responsible and liable for the payment
of such fees and expenses, pro rata based upon their respective Percentage
Interests, and shall pay such fees and expenses promptly after receipt of a
written invoice therefor from the Owner Trustee.
B. Indemnification.
The Certificateholders shall be liable as obligor for, and shall
indemnify the Owner Trustee and the Trust Paying Agent and their respective
successors, assigns, agents, and servants (collectively, the "Indemnified
Parties") from and against, any and all liabilities, obligations, losses,
damages, taxes, claims, actions, and suits, and any and all reasonable costs,
expenses, and disbursements (including reasonable legal fees and expenses) of
any kind and nature whatsoever (collectively, "Expenses") which may at any time
be imposed on, incurred by, or asserted against any Indemnified Party in any way
relating to or arising out of this Agreement, the Basic Documents, the Owner
Trust Estate, the administration of the Owner Trust Estate, or the action or
inaction of the Owner Trustee or the Trust Paying Agent hereunder, except only
that the Certificateholders shall not be liable for or required to indemnify an
Indemnified Party from and against Expenses arising or resulting from any of the
matters described in the third sentence of Section 7.1. The indemnities
contained in this Section shall survive the resignation or termination of the
Owner Trustee or the Trust Paying Agent or the termination of this Agreement. In
any event of any claim, action or proceeding for which indemnity will be sought
pursuant to this Section, the Certificateholders will be entitled to participate
therein, with counsel selected by such Holders and reasonably satisfactory to
the Indemnified Parties, and after notice from Certificateholders to the
Indemnified Parties of its election to assume the defense thereof,
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the Certificateholders shall not be liable to the Indemnified Party under this
Section 8.2 for any legal or other expenses subsequently incurred by such
Indemnified Party in connection with the defense of such action; provided,
however, that this sentence shall not be in effect if (1) the Certificateholders
shall not have employed counsel reasonably satisfactory to the Indemnified Party
to represent the Indemnified Party within a reasonable time after notice of
commencement of the action or (2) the Certificateholders shall have authorized
the employment of counsel for the Indemnified Party at the expense of the
Certificateholders. If the Certificateholders assume the defense of any such
proceeding, they shall be entitled to settle such proceeding without any
liability being assessed against any Indemnified Party or, if such settlement
provides for release of any such Indemnified Party without any liability being
assessed against any Indemnified Party in connection with all matters relating
to the proceeding which have been asserted against such Indemnified Party in
such proceeding by the other parties to such settlement, without the consent of
such Indemnified Party, but otherwise only with the consent of such Indemnified
Party. Certificateholders shall be liable for this indemnification obligation
pro rata, based upon their respective Percentage Interests.
C. Payments to the Owner Trustee.
Any amounts paid to the Owner Trustee or the Trust Paying Agent
pursuant to this Article VIII shall be deemed not to be a part of the Owner
Trust Estate immediately after such payment.
D. Servicer Liability.
In the event the Certificateholders fail to pay all or any portion of
any fees, expenses, or indemnification amounts to the Owner Trustee or the Trust
Paying Agent for which they are liable under this Article VIII, the Servicer
shall pay such amounts to the Owner Trustee or the Trust Paying Agent, as the
case may be, promptly after receipt of an invoice therefor from the party
entitled thereto.
ARTICLE IX
TERMINATION OF TRUST AGREEMENT
A. Termination of Trust Agreement.
1. This Agreement (other than Article VIII) and the
Trust shall terminate and be of no further force or
effect on the earlier of: (i) the final payment or
other liquidation of the [Mortgage Loans and the
disposition of all REO Properties] and the remittance
of all funds due hereunder with respect to such
[Mortgage Loans and REO Properties] or the
disposition of the
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[Mortgage Loans and REO Properties] at the direction
of a majority of the Certificateholders, in either
case after the satisfaction and discharge of the
Indenture pursuant to Section 4.01 of the Indenture;
and (ii) the expiration of 21 years from the death of
the last survivor of the descendants of ▇▇▇▇▇▇ ▇.
▇▇▇▇▇▇▇ (the late ambassador of the United States to
the Court of St. James's). The bankruptcy,
liquidation, dissolution, death, or incapacity of any
Certificateholder or the Company shall not (x)
operate to terminate this Agreement or the Trust, nor
(y) entitle such Certificateholder's legal
representatives or heirs to claim an Accounting or to
take any action or proceeding in any court for a
partition or winding up of all or any part of the
Trust or Owner Trust Estate, nor (z) otherwise affect
the rights, obligations, and liabilities of the
parties hereto.
2. Except as provided in Section 9.1(a) above, none of
the Company, the Servicer, the Bond Insurer, nor any
Certificateholder shall be entitled to revoke or
terminate the Trust.
3. Notice of any termination of the Trust, specifying
the Payment Date upon which the Certificateholders
shall surrender their Certificates to the Owner
Trustee for payment of the final distributions and
cancellation, shall be given by the Owner Trustee to
the Certificateholders, the Bond Insurer, the Rating
Agencies and the Trust Paying Agent mailed within
five Business Days of receipt by the Owner Trustee of
notice of such termination pursuant to Section 9.1(a)
above, which notice given by the Owner Trustee shall
state (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 Owner Trustee 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
Owner Trustee therein specified. The Owner Trustee
shall give such notice to the Certificate Registrar
(if other than the Owner Trustee) and the Trust
Paying Agent at the time such notice is given to
Certificateholders. The Owner Trustee shall give
notice to the Trust Paying Agent of each presentation
and surrender of Certificates promptly, and the Trust
Paying Agent shall promptly cause to be distributed
to the related Certificateholders amounts
distributable on such Payment Date pursuant to
Section 5.2(a).
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4. Upon the winding up of the Trust and its termination,
the Owner Trustee shall cause the Certificate of
Trust to be canceled by filing a certificate of
cancellation with the Secretary of State in
accordance with the provisions of Section 3820 of the
Business Trust Statute.
ARTICLE X
SUCCESSOR OWNER TRUSTEES AND ADDITIONAL OWNER TRUSTEES
A. Eligibility Requirements for Owner Trustee.
The Owner Trustee shall at all times be a corporation satisfying the
provisions of Section 3807(a) of the Business Trust Statute; authorized to
exercise corporate powers; having a combined capital and surplus of at least
[$50,000,000] and subject to supervision or examination by Federal or state
authorities; and having (or having a parent that has) a rating of at least
[_____________and ____________] [and being acceptable to the Bond Insurer]. If
such corporation shall publish reports of condition at least annually, pursuant
to law or to the requirements of the aforesaid supervising or examining
authority, then for the purpose of this Section, the combined capital and
surplus of such corporation shall be deemed to be its combined capital and
surplus as set forth in its most recent report of condition so published. In
case at any time the Owner Trustee shall cease to be eligible in accordance with
the provisions of this Section, the Owner Trustee shall resign immediately in
the manner and with the effect specified in Section 10.2.
B. Resignation or Removal of Owner Trustee.
The Owner Trustee may at any time resign and be discharged from the
trusts hereby created by giving written notice thereof to the Servicer, the
Indenture Trustee, and the Bond Insurer. Upon receiving such notice of
resignation, the Servicer shall promptly appoint a successor Owner Trustee
(acceptable to the Bond Insurer) by written instrument, in duplicate, one copy
of which instrument shall be delivered to the resigning Owner Trustee and one
copy to the successor Owner Trustee. If no successor Owner Trustee shall have
been so appointed and have accepted appointment within [__ days] after the
giving of such notice of resignation, the resigning Owner Trustee or the Bond
Insurer may petition any court of competent jurisdiction for the appointment of
a successor Owner Trustee.
If at any time the Owner Trustee shall cease to be eligible in
accordance with the provisions of Section 10.1 and shall fail to resign after
written request therefor by the Certificateholders or the Servicer, or if at any
time the Owner Trustee shall be legally unable to act, or shall be adjudged
bankrupt or insolvent, or a receiver of the Owner Trustee or of its property
shall be appointed, or any public officer shall take charge or control of the
Owner Trustee or of its property or affairs for the purpose of rehabilitation,
conservation, or liquidation, then the Bond Insurer, or the Certificateholders
or the Servicer with the consent of the Bond Insurer, may remove the Owner
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Trustee. If the Certificateholders or the Servicer or the Bond Insurer shall
remove the Owner Trustee under the authority of the immediately preceding
sentence, the Bond Insurer, or the Servicer with the consent of the Bond
Insurer, shall promptly appoint a successor Owner Trustee by written instrument
in duplicate, one copy of which instrument shall be delivered to the outgoing
Owner Trustee so removed and one copy to the successor Owner Trustee and payment
of all fees owed to the outgoing Owner Trustee.
Any resignation or removal of the Owner Trustee and appointment of a
successor Owner Trustee pursuant to any of the provisions of this Section shall
not become effective until acceptance of appointment by the successor Owner
Trustee pursuant to Section 10.3 written approval by the Bond Insurer and
payment of all fees and expenses owed to the outgoing Owner Trustee. The
Servicer shall provide notice of such resignation or removal of the Owner
Trustee to each of the Rating Agencies, the Indenture Trustee, the Trust Paying
Agent and the Bond Insurer.
C. Successor Owner Trustee.
Any successor Owner Trustee appointed pursuant to Section 10.2 shall
execute, acknowledge, and deliver to the Company, the Indenture Trustee, the
Bond Insurer, and to its predecessor Owner Trustee an instrument accepting such
appointment under this Agreement, and thereupon the resignation or removal of
the predecessor Owner Trustee shall become effective and such successor Owner
Trustee (if acceptable to the Bond Insurer), without any further act, deed, or
conveyance, shall become fully vested with all the rights, powers, duties, and
obligations of its predecessor under this Agreement, with like effect as if
originally named as Owner Trustee. The predecessor Owner Trustee shall upon
payment of its fees and expenses deliver to the successor Owner Trustee all
documents and statements and moneys held by it under this Agreement; and the
Company and the predecessor Owner Trustee shall execute and deliver such
instruments and do such other things as may reasonably be required for fully and
certainly vesting and confirming in the successor Owner Trustee all such rights,
powers, duties, and obligations.
No successor Owner Trustee shall accept appointment as provided in this
Section unless at the time of such acceptance such successor Owner Trustee shall
be eligible pursuant to Section 10.1.
Upon acceptance of appointment by a successor Owner Trustee pursuant to
this Section, the Company shall mail notice of the successor of such Owner
Trustee to all Certificateholders, the Indenture Trustee, the Trust Paying
Agent, the Bondholders, the Bond Insurer and the Rating Agencies. If the Company
fails to mail such notice within [__ days] after acceptance of appointment by
the successor Owner Trustee, the successor Owner Trustee shall cause such notice
to be mailed at the expense of the Company.
D. Merger or Consolidation of Owner Trustee.
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Any corporation into which the Owner Trustee may be merged or converted
or with which it may be consolidated or any corporation resulting from any
merger, conversion, or consolidation to which the Owner Trustee shall be a
party, or any corporation succeeding to all or substantially all of the
corporate trust business of the Owner Trustee, shall be the successor of the
Owner Trustee hereunder, provided such corporation shall be eligible pursuant to
Section 10.1, without the execution or filing of any instrument or any further
act on the part of any of the parties hereto, anything herein to the contrary
notwithstanding; provided further that the Owner Trustee shall mail notice of
such merger or consolidation to the Rating Agencies.
E. Appointment of Co-Trustee or Separate Trustee.
Notwithstanding any other provisions of this Agreement, at any time,
for the purpose of meeting any legal requirements of any jurisdiction in which
any part of the Owner Trust Estate or any Mortgaged Property may at the time be
located, and for the purpose of performing certain duties and obligations of the
Owner Trustee with respect to the Trust and the Certificates, the Owner Trustee
shall have the power and shall execute and deliver all instruments to appoint
one or more Persons approved by the Owner Trustee and acceptable to the Bond
Insurer to act as co-trustee, jointly with the Owner Trustee, or separate
trustee or separate trustees, of all or any part of the Owner Trust Estate, and
to vest in such Person, in such capacity, such title to the Trust, or any part
thereof, and, subject to the other provisions of this Section, such powers,
duties, obligations, rights, and trusts as the Bond Insurer and 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 trustee pursuant to Section 10.1 and no notice of the appointment of
any co-trustee or separate trustee shall be required pursuant to Section 10.3.
Each separate trustee and co-trustee shall, to the extent permitted by
law, be appointed and act subject to the following provision 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 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;
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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 the separate trustees and co-trustees, as if
given to each of them. Every instrument appointing any separate trustee or
co-trustee, other than this Agreement, shall refer to this Agreement and to the
conditions of this Article. Each separate trustee and co-trustee, upon its
acceptance of appointment, shall be vested with the estates specified in its
instrument of appointment, either jointly with the Owner Trustee or separately,
as may be provided therein, subject to all the provisions of this Agreement,
specifically including every provision of this Agreement relating to the conduct
of, affecting the liability of, or affording protection to, the Owner Trustee.
Each such instrument shall be filed with the Owner Trustee.
Any separate trustee or co-trustee may at any time appoint the Owner
Trustee as its Agent or attorney-in-fact with full power and authority, to the
extent not prohibited by law, to do any lawful act under or in respect of this
Agreement on its behalf and in its name. If any separate trustee or co-trustee
shall die, become incapable of acting, resign or be removed, all of its estates,
properties, rights, remedies and trusts shall vest in and be exercised by the
Owner Trustee, to the extent permitted by law, without the appointment of a new
or successor trustee.
ARTICLE XI
CONTRIBUTION OF MORTGAGE LOANS
A. Agreement to Contribute and Convey.
The Issuer will deliver the net proceeds from the sale of the Bonds and
issue the Certificates to the order of the Company or its designee in
consideration of the transfer of the Mortgage Loans and the related rights
thereunder and the rights pursuant to the Sales Agreement (collectively, the
"Consideration"). As and for the Consideration and subject to the terms and
conditions set forth herein, the Company agrees to contribute and convey, and
the Trust agrees to accept and acquire, all of the Company's right, title, and
interest in and to the Mortgage Loans identified on the schedule (the "Loan
Schedule") annexed hereto as [Exhibit E.] The Loan Schedule will set forth as to
each Mortgage Loan the items specified in the definition of "Loan Schedule" in
the Indenture.
The aggregate of the principal balances of the Mortgage Loans being
contributed and conveyed pursuant to this Agreement as of the close of business
on the applicable Cut-off Dates, after application of all payments of principal
received in respect of such Mortgage Loans before the
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applicable Cut-off Dates (the "Initial Pool Balance"), is set forth on the Cross
Receipt executed concurrently herewith in the form of [Exhibit F] attached
hereto (the "Cross Receipt"). Simultaneously with and in consideration of the
Company's contribution and conveyance of the Mortgage Loans to the Trust, the
Trust shall cause the Bonds to be issued and delivered and shall transfer the
net proceeds received from the sale of the Bonds to be delivered to the Company
and the Trust shall cause the Certificates to be issued to the order of the
Company or its designee. The Company shall be deemed automatically and for all
purposes to have made a contribution to the capital of the Trust (which
contribution shall be reflected in the value assigned to the certificates
evidencing equity interests in the Trust) in an aggregate amount specified on
the Cross Receipt. The transfer and conveyance of the Mortgage Loans shall take
place on the Closing Date.
B. Conveyance of Mortgage Loans.
1. Effective as of the Closing Date, subject only to
delivery of the Mortgage Loan File (as defined in the
Sales Agreement) for each Mortgage Loan pursuant to
subsection (c) below, the Company does hereby
contribute, assign, transfer, and otherwise convey to
the Trust, without recourse, representation, or
warranty (other than as expressly set forth in
Section 2.10 (a) hereof), and the Trust does hereby
accept, assume, and acquire, all of the Company's
right, title, and interest in and to the Mortgage
Loans identified on the Loan Schedule, and the Trust
hereby assumes and agrees to perform and be bound by
each and all of the covenants, agreements, duties,
and obligations of the Company arising under or
relating to such Mortgage Loans.
2. The Trust and its assignees shall be entitled to
receive all payments of principal and interest due on
or with respect to the Mortgage Loans after the
applicable Cut-off Date, and all other recoveries of
principal and interest collected on or after the
applicable Cut-off Date (other than in respect of
interest that accrued on such Mortgage Loan during
periods prior to the applicable Cut-off Date), and
each of the rights of the Company pursuant to
representations, warranties, and indemnities in favor
of the Company contained in the Sales Agreement. All
payments of interest and principal due before the
applicable Cut-off Date, but collected after the
applicable Cut-off Date, and recoveries of principal
and interest collected before the applicable Cut-off
Date (other than amounts representing interest that
accrued on the Mortgage Loans during any period on or
after the applicable Cut-off Date), shall belong to,
and be promptly remitted to, _____________________.
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3. In connection with its contribution and conveyance of
the Mortgage Loans pursuant to subsection (a) above,
the terms of the Sales Agreement govern the delivery
of the Mortgage Loan Files to the Indenture Trustee,
as the Trust's designee, and the Company assigns all
of its rights under the Sales Agreement to the Trust.
4. In connection with its conveyance of the Mortgage
Loans pursuant to subsection (a) above, the Company
shall deliver to the Trust or its designee in respect
of such Mortgage Loans, on or before the Closing
Date, all amounts, if any, received on each Mortgage
Loan on or after the applicable Cut-off Date (other
than amounts representing interest and principal due
on or prior to the applicable Cut-off Date) held by
or on behalf of the Company.
5. the Company shall, at any time upon the request of
the Trust, without limiting the obligations of the
Company under this Agreement, execute, acknowledge,
and deliver all such additional documents and
instruments and all such further assurances and will
do or cause to be done all such further acts and
things as may be proper or reasonably necessary to
carry out the intent of this Agreement.
C. Assignment of Related Rights and Remedies.
1. Effective as of the Closing Date, subject only to
delivery of the Mortgage Loan File for each Mortgage
Loan pursuant to Section 11.2(c) hereof, the Company
does hereby assign, transfer, and otherwise convey to
Trust, without recourse, representation, or warranty
(other than as expressly set forth in Section 2.10(a)
hereof), and the Trust does hereby accept, assume,
and acquire, to be held jointly and severally with
the Company, all of the Company's rights and remedies
under the Sales Agreement and the Trust hereby
assumes and agrees to perform and be bound by each
and all of the covenants and agreements of the
Company arising under the Sales Agreement relating to
such rights and remedies and the exercise or
enforcement thereof.
2. Simultaneously with the exercise of any rights and
remedies or any notices given to ________________ by
the Trust under the Sales Agreement, the Trust shall
give the Company and the Bond Insurer notice thereof,
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including, without limitation, copies of all notices
given to ________________________.
3. This Section 11.3 provides the sole remedies
available to the Trust, its successors and assignees,
respecting any breach (i) of representations and
warranties with respect to the Mortgage Loans to
which reference is made in Section 2.10(c) or (ii) on
the part of the Company under Section 2(c) hereof.
D. Closing.
The closing of the conveyance of the Mortgage Loans (the "Closing")
shall be held at the offices of ____________________________________, on the
Closing Date.
The Closing shall be subject to each of the following conditions:
1. All terms and conditions of this Agreement required
to be complied with on or before the Closing Date
shall have been complied with and the Company shall
have the ability to comply with all terms and
conditions and perform all duties and obligations
required to be complied with or performed after the
Closing Date.
2. The Trust shall have paid all costs and expenses
payable by it to the Company or otherwise pursuant to
this Agreement.
Both parties shall use their best efforts to perform their respective
obligations hereunder in a manner that will enable the Trust to acquire the
Mortgage Loans on the Closing Date. Notwithstanding the foregoing, satisfaction
by the Company or Trust of its respective obligations under the foregoing
provisions of this Section 11.4 shall not be conditions precedent to the
obligation of the Company or Trust, respectively, to close the transactions
contemplated by this Agreement.
E. Servicing.
As of the applicable Cut-off Date, the Mortgage Loans will be serviced
by _________________________ (in such capacity, the "Servicer") pursuant to the
terms of a Servicing Agreement, to be dated as of __________ 20__ (the
"Servicing Agreement"), by and among the Trust, the Servicer and the Indenture
Trustee.
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▇. ▇▇▇▇▇ of a Security Interest.
It is the express intent of the parties hereto that the conveyance of
the Mortgage Loans by the Company to the Trust as provided in Section 11.2(a)
hereof be, and be construed as, a complete and absolute transfer by the Company
to the Trust of all of the Company's right, title, and interest in and to the
Mortgage Loans and not as a pledge of the Mortgage Loans by the Company to the
Trust to secure a debt or other obligation of the Company. However, if,
notwithstanding the aforementioned intent of the parties, the Mortgage Loans are
held to be property of the Company, then (a) it is the express intent of the
parties that such conveyance be deemed a pledge of the Mortgage Loans by the
Company to the Trust to secure a debt or other obligation of the Company, and
(b) (i) this Agreement shall also be deemed to be a security agreement within
the meaning of Article 9 of the ______________ Uniform Commercial Code; (ii) the
conveyance provided for in Section 11.2(a) hereof shall be deemed to be a grant
by the Company to the Trust of a security interest in all of the Company's
right, title and interest in and to the Mortgage Loans, and all amounts payable
to the holder of the Mortgage Loans in accordance with the terms thereof, and
all proceeds of the conversion, voluntary, or involuntary, of the foregoing into
cash, instruments, securities, or other property, including without limitation
all such amounts, other than investment earnings from time to time held or
invested pursuant to and in accordance with the provisions of the Servicing
Agreement or the Indenture, as applicable, whether in the form of cash,
instruments, securities, or other property; (iii) the subsequent pledge of the
Mortgage Loans by the Trust to the Indenture Trustee as contemplated by the
preamble hereto shall be deemed to be an assignment of any security interest
created hereunder; (iv) the possession by the Company or the Trust or any of
their respective agents, including, without limitation, the Indenture Trustee or
its agent, of the notes or other instruments evidencing the indebtedness of the
mortgagors under the related Mortgage Loans (the "Mortgage Bonds") and such
other items of property relating to the Mortgage Loans as constitute
instruments, money, negotiable documents, or chattel paper shall be deemed to be
"possession by the secured party" for purposes of perfecting the security
interest pursuant to Section 9-305 of the ____________ Uniform Commercial Code;
and (v) notifications to persons (other than the Indenture Trustee) holding such
property, and acknowledgments, receipts, or confirmations from persons holding
such property, shall be deemed notifications to, or acknowledgments, receipts,
or confirmations from, financial intermediaries, bailees, or agents (as
applicable) of the secured party for the purpose of perfecting such security
interest under applicable law. The Company and the Trust shall, to the extent
consistent with this Agreement, take such actions as may be necessary to ensure
that, if this Agreement were deemed to create a security interest in the
Mortgage Loans, such security interest would be deemed to be a perfected
security interest of first priority under applicable law and will be maintained
as such throughout the term of this Agreement and the Indenture..
ARTICLE XII
MANAGEMENT OF THE TRUST
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Powers and Duties of the Bond Administrator.
1. The Bond Administrator shall perform, on behalf of
the Trust acting through the Owner Trustee, the
duties of the Trust under the Indenture specified
below, and shall consult with the Owner Trustee
regarding such duties. The duties referred to above
are as follows (section references are to sections of
the Indenture):
a. The determination of the form of the Bonds
(Section 2.01);
b. Directing the Owner Trustee to execute the
Bonds for the Trust and to return them to
the Indenture Trustee for authentication and
delivery (Section 2.05);
c. Direction of the Owner Trustee to execute
and deliver Bonds for registration of
transfer and exchange (Section 2.06);
d. Direction of the Owner Trustee as to actions
to be taken with respect to Bonds alleged to
have been lost, stolen, destroyed or
mutilated (Section 2.07);
e. Maintenance of Bond Registrar's office and
designation of any offices where Bonds may
be presented or surrendered (Section 3.02);
f. If an additional Trust Paying Agent is to be
appointed, the solicitation and review of
bids, examination of the qualifications of
bidders, and submission to the Owner Trustee
of a list of candidates from which such
appointment may be made by the Owner
Trustee; preparation and submission to each
such Trust Paying Agent for execution of an
agreement to the effect that such Trust
Paying Agent holds funds in trust; the
direction of a Trust Paying Agent to remit
all funds it is holding to the Indenture
Trustee; the direction of the Indenture
Trustee to deposit moneys with such Trust
Paying Agent; and notifications to Holders
of Bonds of availability of their last
payments (Section 3.03);
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g. The monitoring of and compliance with the
Trust's obligations under Section 3.07(c)
(Section 3.07(c));
h. The monitoring of and compliance with the
Trust's obligations under Sections 3.12 (but
only to the extent of the Bond
Administrator's obligations under Section
(b)(i) hereof) and 3.13 of the Indenture
(Sections 3.11 and 3.13);
i. If necessary, the preparation and, upon
execution by the Owner Trustee, delivery and
(as necessary) filing of documents necessary
for the satisfaction and discharge of the
Indenture, except that, in the case of a
redemption, the party calling for the
redemption would be responsible for these
matters (Section 4.01);
j. Direction of Owner Trustee in connection
with anything required of the Issuer
relating to the appointment of any
co-Trustees (Section 6.13);
k. If an Authenticating Agent is to be
appointed, the solicitation and review of
bids, examination of the qualifications of
bidders, and submission to the Owner Trustee
of a list of qualified candidates from which
such appointment may be made by the Owner
Trustee (Section 6.14);
l. Furnishing to the Indenture Trustee the
names and addresses of Bondholders to the
extent required by Section 7.01 (Section
7.01);
m. [Preparing for execution by the Owner
Trustee, direction to the Owner Trustee
regarding execution, and filing reports with
the Securities and Exchange Commission
(Section 7.04);]
n. Direction of the Owner Trustee's execution
of documents, if any, as provided by the
Servicer as necessary to reconvey title to
repurchased Mortgage Loans to _____ (Section
8.05);
o. Appointment of any Custodian and ensuring
Custodian complies with all applicable
duties Section 8.13); and
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p. Notifying the Owner Trustee when the Bond
Administrator is of the opinion that a
Supplemental Indenture may be necessary or
appropriate and determining, based on advice
of counsel, whether notations of amendments
should be made on Bond Certificates
(Sections 9.01, 9.02, and 9.06).
2. The Bond Administrator shall, subject at all times to
Section 12.5 of this Agreement, take all appropriate
action with respect to the following tasks, inter
alia:
a. The preparation and delivery of the income
tax returns, tax elections, financial
statements, and such annual or other reports
of the Trust pursuant to Section 2.11 (k)
hereof; provided however, that the Bond
Administrator shall not be required to
compute the Trust's gross income except to
the extent it can do so without unreasonable
effort or expense based upon income
statements furnished to it; and
b. The review of documentation in connection
with transfers of the Bonds, in the
preparation and delivery of Bonds and the
determination of whether a proposed transfer
of a Bond is permissible under the terms of
the Indenture.
3. The Bond Administrator shall carry out in timely
fashion, and in accordance with the provisions of the
Indenture, all duties which the Bond Administrator is
required to perform under the Indenture on behalf of
the Issuer pursuant to the terms of this Agreement.
The Bond Administrator shall have absolute discretion
in the performance of the function set forth in this
subsection (c) and shall have no obligation to notify
the Owner Trustee of its actions except as set forth
in the Indenture.
4. [In addition to the filings required under Section
12.1(a)(xiii) above, as soon as practicable, but not
later than eighteen months after ____________, 20__,
the Bond Administrator shall prepare, direct the
Owner Trustee as to the execution of, and file with
the Securities and Exchange Commission a report on
Form 8-K containing a copy of the annual Payment Date
Statement described in Section 2.08 of the
Indenture.]
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5. The Indenture Trustee hereby agrees that it will not
take any action that is not related to the
administration of the Trust Estate to (i) impair the
validity or effectiveness of the Indenture or the
Grant of the Trust Estate thereunder or release any
Person from any covenant or obligation under the
Indenture, except as expressly permitted thereby,
(ii) creating any lien, charge, security interest, or
similar encumbrance (other than the lien of the
Indenture or other permitted encumbrance or as
otherwise permitted under the provisions of the
Indenture) on the Trust Estate, or (iii) cause the
lien of the Indenture not to constitute a valid
perfected first priority security interest in the
Trust Estate, except as otherwise expressly permitted
under the Indenture. The Indenture Trustee shall, in
connection with its tax reporting obligations under
Section (b)(i) above, comply with the provisions of
Section 2.11 hereof and shall not take any action
that, to the actual knowledge of the Bond
Administrator, would result in the Issuer becoming
taxable as a corporation for federal income tax
purposes.
B. Compensation; Payment of Certain Expenses.
The Bond Administrator will provide the services called for under the
enumerated subparagraphs of paragraphs 12.1(a), 12.1(b), and 12.1(d) hereof
above without any separate compensation therefor for so long as the Indenture
remains in effect and thereafter shall receive monthly compensation equal to the
Indenture Trustee Fee payable under the Indenture from amounts otherwise payable
to the Certificateholders as provided in the this Agreement. The Bond
Administrator shall perform any other services as may be agreed between the Bond
Administrator and the Owner Trustee for such compensation as may be agreed
between the Bond Administrator and the Owner Trustee; provided that such
compensation shall be paid to the Bond Administrator by the Owner Trustee solely
from funds received by the Owner Trustee from the Owners pursuant to the this
Agreement. If the date of termination of this Agreement is not a date on which
the Bond Administrator is entitled to be paid hereunder, the Bond Administrator
shall be paid the amount due it pursuant to this Sections and Section 12.5(a) as
of such termination promptly after such date of termination.
C. Instruction of the Owner Trustee.
If in performing its duties under this Agreement, the Bond
Administrator is required to determine any matter or perform any function above
which is non-ministerial in nature, then the Bond Administrator shall properly
deliver notice to the Owner Trustee and the Certificateholders requesting
written instructions as to the course of action to be taken. The
Certificateholders shall instruct the Bond Administrator in writing as to the
action to be taken by the Bond Administrator. If the Bond Administrator does not
receive such instructions within [___ days] after it has delivered such notice,
it may, but shall be under no duty to, take or refrain from taking
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such action not inconsistent with this Agreement or the Indenture as it shall
deem advisable in the best interest of the holders of the Bonds and the Trust.
D. Benefit of the Agreement.
It is expressly agreed that in performing its duties pursuant to
Section 12.1 of this Agreement the Bond Administrator will act for the benefit
of holders of the Bonds and the Bond Insurer as well as for the benefit of the
Trust, and that such obligations on the part of the Bond Administrator shall be
enforceable at the instance of the Indenture Trustee and the Trust.
E. Limitation of Responsibility of the Bond Administrator.
1. The Bond Administrator will have no responsibility
under this Agreement other than to render the
services provided for hereunder in good faith. The
Bond Administrator, its affiliates, its directors,
officers, shareholders, and employees will not be
liable to the Trust, the Owner Trustee, the Indenture
Trustee, the Bondholders, or others, except by reason
of acts constituting bad faith, willful misfeasance,
gross negligence, or reckless disregard of the duties
of the Bond Administrator hereunder. The Owner
Trustee will reimburse, indemnify, and hold harmless
the Bond Administrator and its affiliates,
shareholders, directors, officers, and employees with
respect to all expenses, losses, damages,
liabilities, demands, charges, and claims of any
nature in respect of any acts or omissions performed
or omitted by the Bond Administrator in good faith
and in accordance with the standard set forth above.
2. The Trust undertakes to pay or cause to be paid any
amount due the Bond Administrator or its affiliates,
shareholders, directors, officers and employees,
under Section 12.2 or Section 12.5(a) and such
amounts shall be paid as provided for under the
Indenture or out of the assets of the Trust that are
free of the lien of the Indenture (and in no event by
_______________________ in its individual capacity).
F. Termination of Bond Administrator.
1. The Bond Administrator, at its election, may resign
as Bond Administrator hereunder and be discharged of
its duties hereunder upon at least [___] days' prior
notice to the Owner Trustee, the Bond Insurer, and
the
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Indenture Trustee; provided however, that at any time
while the Bonds are outstanding no such resignation
and discharge shall become effective until a Person
selected by the Bond Administrator in its discretion
and acceptable to the Owners, the Bond Insurer, and
the Rating Agencies shall have assumed and agreed to
perform the duties of the Bond Administrator
hereunder as evidenced by a written instrument to
such effect delivered to the Owner Trustee. Upon
delivery of such written instrument to the Owner
Trustee, the Trust shall promptly deliver to the
successor Bond Administrator a written instrument
acknowledging and accepting the assignment of the
resigning Bond Administrator's rights hereunder to
the successor Bond Administrator. Each such successor
Bond Administrator shall be deemed to be the Bond
Administrator for all purposes of this Agreement.
2. If any of the following events shall occur and be
continuing:
a. The Bond Administrator shall violate any
provision of this Agreement and such default
is not cured within [___] days after notice
thereof is given to the Bond Administrator
by the Owner Trustee, [the Bond Insurer,] or
the Indenture Trustee;
b. A court having jurisdiction over the
premises shall enter a decree or order for
relief in respect of the Bond Administrator
in an involuntary case under any applicable
bankruptcy, insolvency, or other similar law
now or hereafter in effect, or appoint a
receiver, liquidation, assignee, custodian,
trustee, sequestrator (or other similar
official) of the Bond Administrator or for
any substantial part of its property, or
order the winding-up or liquidation of its
affairs; or
c. The Bond Administrator shall commence a
voluntary case under any applicable
bankruptcy, insolvency, or other similar law
now or hereafter in effect, or shall consent
to the entry of an order for relief in an
involuntary case under any such law, or
shall consent to the appointment of or
taking possession by a receiver, liquidator,
assignee, trustee, custodian, sequestrator
(or other similar official) of the Bond
Administrator or for any substantial part of
its property, or shall make any general
assignment for the benefit of creditors, or
shall fail generally to pay its debts as
they become due,
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then in any such event this Agreement may be terminated by the Owner Trustee
upon notice to the Bond Administrator; provided however, that the Bond
Administrator shall nevertheless be entitled to any amounts due to it pursuant
to Sections 12.2 and 12.5 accruing prior to the date of such termination.
3. Following receipt of instructions from [the Bond
Insurer or] the owners of the Bonds[, with the prior
consent of the Bond Insurer, and] upon [__ days]
written notice to the Bond Administrator, the Owner
Trustee may remove the Bond Administrator; provided
however, that the Bond Administrator shall
nevertheless be entitled to any amounts due to it
pursuant to Sections 12.2 and 12.5 accruing prior to
the date of such termination.
G. Bankruptcy Matters.
The Bond Administrator shall not take any action to cause the Trust to
dissolve in whole or in part or file a voluntary petition or otherwise initiate
proceedings to have the Trust adjudicated bankrupt or insolvent, or consent to
the institution of bankruptcy or insolvency proceedings against the Trust, or
file a petition seeking or consenting to reorganization or relief of the Trust,
as debtor, under any applicable federal or state law relating to bankruptcy,
insolvency, or other relief for debtors with respect to the Trust; or seek or
consent to the appointment of any trustee, receiver, conservator, assignee,
sequestrator, custodian, liquidator (or other similar official) of the Trust or
of all or any substantial part of the properties and assets of the Trust, or
cause the Trust to make any general assignment for the benefit of creditors of
the Trust, or take any action in furtherance of any of the above actions.
ARTICLE XIII
MISCELLANEOUS
A. Supplements and Amendments.
This Agreement may be amended by the Company and the Owner Trustee,
[with the prior consent of the Bond Insurer,] and with prior written notice to
the Rating Agencies, but to cure any ambiguity, to correct or supplement any
provisions in this Agreement, or for the purpose of adding any provisions to or
changing in any manner or eliminating any of the provisions of this Agreement
without the consent of any of the Bondholders or the Certificateholders or the
Indenture Trustee, or of modifying in any manner the rights of the Bondholders
or the Certificateholders; provided however, such action shall not adversely
affect in any material respect the interests of any Bondholder or
Certificateholder or the rights of the Bond Insurer. An amendment described
above shall be deemed not to adversely affect in any material respect the
53
58
interests of any Bondholder or Certificateholder if the party requesting the
amendment satisfies the Rating Agency Condition with respect to such amendment.
This Agreement may also be amended from time to time by the Company and
the Owner Trustee, with the prior written consent of the Rating Agencies and
with the prior written consent of the Indenture Trustee, [the Bond Insurer,] the
Holders (as defined in the Indenture) of Bonds evidencing more than [___] of the
Outstanding Amount of the Bonds, the Holders of Certificates evidencing more
than [___] of the Percentage Interests of the Trust Interest and if the party
requesting such amendment satisfies the Rating Agency Condition with respect to
such amendment, 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 Bondholders or the Certificateholders; provided
however, no such amendment shall (a) increase or reduce in any manner the amount
of, or accelerate or delay the timing of, collections of payments on the
Mortgage Loans or distributions that shall be required to be made for the
benefit of the Bondholders, the Certificateholders [or the Bond Insurer,] or (b)
reduce the aforesaid percentage of the Outstanding Amount of the Bonds or the
Percentage Interests required to consent to any such amendment, in either case
of clause (a) or (b) without the consent of the holders of all the outstanding
Bonds [and the Bond Insurer,] and in the case of clause (b) without the consent
of the Holders of all the outstanding Certificates.
Promptly after the execution of any such amendment or consent, the
Owner Trustee shall furnish written notification of the substance of such
amendment or consent to each Certificateholder, the Indenture Trustee[, the Bond
Insurer] and each of the Rating Agencies.
It shall not be necessary for the consent of Certificateholders, the
Bondholders, or the Indenture Trustee pursuant to this Section to approve the
particular form of any proposed amendment or consent, but it shall be sufficient
if such consent shall approve the substance thereof. The manner of obtaining
such consents (and any other consents of Certificateholders provided for in this
Agreement or in any other Basic Document) and of evidencing the authorization of
the execution thereof by Certificateholders shall be subject to such reasonable
requirements as the Owner Trustee may prescribe.
Promptly after the execution of any amendment to the Certificate of
Trust, the Owner Trustee shall cause the filing of such amendment with the
Secretary of State.
Prior to the execution of any amendment to this Agreement or the
Certificate of Trust, the Owner Trustee shall be entitled to receive and rely
upon an Opinion of Counsel stating that the execution of such amendment is
authorized or permitted by this Agreement. The Owner Trustee may, but shall not
be obligated to, enter into any such amendment which affects the Owner Trustee's
own rights, duties, or immunities under this Agreement or otherwise.
B. No Legal Title to Owner Trust Estate in Holders.
54
59
The Certificateholders shall not have legal title to any part of the
Owner Trust Estate. The Certificateholders shall be entitled to receive
distributions with respect to their undivided ownership interest therein only in
accordance with Articles V and IX. No transfer, by operation of law or
otherwise, of any right, title, or interest of the Certificateholders to and in
their ownership interest in the Owner Trust Estate shall operate to terminate
this Agreement or the Trust hereunder or entitle any transferee to an
[Accounting] or to the transfer to it of legal title to any part of the Owner
Trust Estate.
C. Limitations on Rights of Others.
Except for Section 2.7, the provisions of this Agreement are solely for
the benefit of the Owner Trustee, the Company, the Certificateholders, [the Bond
Insurer,] and to the extent expressly provided herein, the Indenture Trustee and
the Bondholders, and nothing in this Agreement (other than Section 2.7), whether
express or implied, shall be construed to give to any other Person any legal or
equitable right, remedy or claim in the Owner Trust Estate or under or in
respect of this Agreement or any covenants, conditions, or provisions contained
herein.
55
60
D. Notices.
1. Unless otherwise expressly specified or permitted by
the terms hereof, all communications provided for or
permitted hereunder shall be in writing and shall be
deemed to have been given if (1) personally
delivered, (2) upon receipt by the intended recipient
or [_____] Business Days after mailing if mailed by
certified mail, postage prepaid (except that notice
to the Owner Trustee shall be deemed given only upon
actual receipt by the Owner Trustee), (3) sent by
express courier delivery service and received by the
intended recipient, or (4) except with respect to
notices sent to the Owner Trustee, transmitted by
telex or facsimile transmission (or any other type of
electronic transmission agreed upon by the parties
and confirmed by a writing delivered by any of the
means described in (1), (2) or (3), at the following
addresses: (i) if to the Owner Trustee, its Corporate
Trust Office; (ii) if to the Company,
___________________________, Attention: __________,
Telecopy: ______; (iii) if to the Bond Insurer,
____________________, Attention: __________,
Telecopy: ______; (iv) if to the Trust Paying Agent,
_________________, Attention: __________, Telecopy:
______; (v) if to ________________, Attention:
__________, Telecopy: ______ or, as to each such
party, at such other address as shall be designated
by such party in a written notice to each other
party.
2. 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 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.
E. Severability.
Any provision of this Agreement that is prohibited or unenforceable in
any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of
such prohibition or unenforceability without invalidating the remaining
provisions hereof, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction.
56
61
F. Separate Counterparts.
This Agreement may be executed by the parties hereto in separate
counterparts, each of which when so executed and delivered shall be an original,
but all such counterparts shall together constitute but one and the same
instrument.
G. Successors and Assigns.
All covenants and agreements contained herein shall be binding upon,
and inure to the benefit of, the Company, [the Bond Insurer,] the Owner Trustee,
and its successors and each owner and its successors and permitted assigns, all
as herein provided. Any request, notice, direction, consent, waiver, or other
instrument or action by a Certificateholder shall bind the successors and
assigns of such Certificateholder.
H. No Petition.
The Owner Trustee, by entering into this Agreement, each
Certificateholder, by accepting a Certificate, and the Indenture Trustee and
each Bondholder by accepting the benefits of this Agreement, hereby covenant and
agree that they will not at any time institute against the Company or the Trust,
or join in any institution against the Company or the Trust of, any bankruptcy,
reorganization, arrangement, insolvency, or liquidation proceedings, or other
proceedings under any United States Federal or state bankruptcy or law in
connection with any obligations relating to the Certificates, the Bonds, this
Agreement, or any of the Basic Documents.
I. No Recourse.
Each Certificateholder by accepting a Certificate acknowledges that
such Certificateholder's Certificate represents a beneficial interest in the
Trust only and does not represent an interest in or an obligation of the
Servicer, the Company, the Owner Trustee, or any Affiliate thereof and no
recourse may be had against such parties or their assets, except as may be
expressly set forth or contemplated in this Agreement, the Certificates, or the
Basic Documents.
J. Headings.
The headings of the various Articles and Sections herein are for
convenience of reference only and shall not define or limit any of the terms or
provisions hereof.
K. GOVERNING LAW.
57
62
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.
▇. ▇▇▇▇▇ of Certificateholder Rights to Bond Insurer.
1. In consideration for the issuance of the Certificates
and for the guarantee of the Bonds by the Bond
Insurer pursuant to the Insurance Policy, the holders
of the Certificates hereby grant to the Bond Insurer
the right to act as the holder of [____]of the
outstanding Certificates for the purpose of
exercising the rights of the Certificateholders under
this Agreement without the consent of the
Certificateholders, including the voting rights of
such holders hereunder, but excluding those rights
requiring the consent of all such holders under
Section 13.1 and any rights of such holders to
distributions under Section 5.2(a); provided that the
preceding grant of rights to the Bond Insurer by the
holders of the Trust Interest shall be subject to
Section 13.14.
2. The rights of the Bond Insurer to direct certain
actions and consent to certain actions of the
Certificateholders hereunder will terminate at such
time as the Balance of the Bonds has been reduced to
zero and the Bond Insurer has been reimbursed for any
amounts owed under the Insurance Policy and the
Insurance Agreement and the Bond Insurer has no
further obligation under the Insurance Policy.]
M. Third Party Beneficiary.
The Bond Insurer is an intended third-party beneficiary of this
Agreement, and this Agreement shall be binding upon and inure to the benefit of
the Bond Insurer; provided that, notwithstanding the foregoing, for so long as a
Bond Insurer Default is continuing with respect to its obligations under the
Bond Insurance Policy, the Bondholders shall succeed to the Bond Insurer's
rights hereunder. Without limiting the generality of the foregoing, all
covenants and agreements in this Agreement that expressly confer rights upon the
Bond Insurer shall be for the benefit of and run directly to the Bond Insurer,
and the Bond Insurer shall be entitled to rely on and enforce such covenants to
the same extent as if it were a party to this Agreement.]
N. Suspension and Termination of Bond Insurer's Rights.
58
63
During the continuation of a Bond Insurer Default, rights granted or
reserved to the Bond Insurer hereunder shall vest instead in the Owners;
provided that the Bond Insurer shall be entitled to any distributions in
reimbursement of the Bond Insurer Reimbursement Amount, and the Bond Insurer
shall retain those rights under Section 13.1 to consent to any amendment of this
Agreement.
At such time as either (i) the Bond Balance of the Bonds has been
reduced to zero or (ii) the Insurance Policy has been terminated and in either
case of (i) or (ii) the Bond Insurer has been reimbursed for all amounts owed
under the Insurance Policy and the Insurance Agreement (and the Bond Insurer no
longer has any obligation under the Insurance Policy, except for breach thereof
by the Bond Insurer), then the rights and benefits granted or reserved to the
Bond Insurer hereunder (including the rights to direct certain actions and
receive certain notices) shall terminate and the Certificateholders shall be
entitled to the exercise of such rights and to receive such benefits of the Bond
Insurer following such termination to the extent that such rights and benefits
are applicable to the Certificateholders.]
[Signatures follow]
59
64
IN WITNESS WHEREOF, the parties hereto have caused this Deposit Trust
Agreement to be duly executed by their respective officers hereunto duly
authorized, as of the day and year first above written.
UNION PLANTERS HOME EQUITY
CORP., as Depositor
By:
Name:
Title:
______________________________, in its
individual capacity only as specifically set
forth herein and otherwise not in its
individual capacity, but solely as Owner
Trustee
By:
Authorized Signatory
The Trust Paying Agent hereby acknowledges its appointment as Trust
Paying Agent under this Agreement and agrees to act in such capacity as
described herein and as Bond Administrator.
By:
Name:
Title:
60
65
The Servicer hereby acknowledges its obligations under this Agreement
and agrees to act in accordance therewith.
By:
Name:
Title:
61
66
EXHIBIT A-1
TO THE TRUST AGREEMENT
(FORM OF CERTIFICATE)
A-1
67
THE EQUITY INTEREST IN THE TRUST REPRESENTED BY THIS CERTIFICATE HAS NOT BEEN
AND WILL NOT BE REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
"ACT"), OR ANY STATE SECURITIES LAWS. THIS EQUITY INTEREST MAY BE DIRECTLY OR
INDIRECTLY OFFERED OR SOLD OR OTHERWISE DISPOSED OF (INCLUDING PLEDGED) BY THE
HOLDER HEREOF ONLY TO (I) A "QUALIFIED INSTITUTIONAL BUYER" AS DEFINED IN RULE
144A UNDER THE ACT, IN A TRANSACTION THAT IS REGISTERED UNDER THE ACT AND
APPLICABLE STATE SECURITIES LAWS OR THAT IS EXEMPT FROM THE REGISTRATION
REQUIREMENTS OF THE ACT PURSUANT TO RULE 144A OR (II) A PERSON INVOLVED IN THE
ORGANIZATION OR OPERATION OF THE TRUST OR AN AFFILIATE OF SUCH A PERSON WITHIN
THE MEANING OF RULE 3A-7 OF THE INVESTMENT COMPANY ACT OF 1940, AS AMENDED
(INCLUDING, BUT NOT LIMITED TO, ________________________________) IN A
TRANSACTION THAT IS REGISTERED UNDER THE ACT AND APPLICABLE STATE SECURITIES
LAWS OR THAT IS EXEMPT FROM THE REGISTRATION REQUIREMENTS OF THE ACT AND SUCH
LAWS. NO PERSON IS OBLIGATED TO REGISTER THIS EQUITY INTEREST UNDER THE ACT OR
ANY STATE SECURITIES LAWS.
NO TRANSFER OF THIS CERTIFICATE OR ANY BENEFICIAL INTEREST THEREIN SHALL BE
MADE TO ANY PERSON UNLESS THE OWNER TRUSTEE HAS RECEIVED A CERTIFICATE FROM THE
TRANSFEREE TO THE EFFECT THAT SUCH TRANSFEREE (I) IS NOT A PERSON WHICH IS AN
EMPLOYEE BENEFIT PLAN, TRUST OR ACCOUNT SUBJECT TO TITLE I OF THE EMPLOYEE
RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA") OR SECTION 4975 OF
THE CODE OR A GOVERNMENTAL PLAN, DEFINED IN SECTION 3(32) OF ERISA SUBJECT TO
ANY FEDERAL, STATE OR LOCAL LAW WHICH IS, TO A MATERIAL EXTENT, SIMILAR TO THE
FOREGOING PROVISIONS OF ERISA OR THE CODE (ANY SUCH PERSON BEING A "PLAN") AND
(II) IS NOT AN ENTITY, INCLUDING AN INSURANCE COMPANY SEPARATE ACCOUNT OR
GENERAL ACCOUNT, WHOSE UNDERLYING ASSETS INCLUDE PLAN ASSETS BY REASON OF A
PLAN'S INVESTMENT IN THE ENTITY.
THIS CERTIFICATE MAY NOT BE TRANSFERRED, SOLD, OR OTHERWISE DISPOSED OF UNLESS,
PRIOR TO SUCH DISPOSITION, THE PROPOSED TRANSFEREE DELIVERS TO THE OWNER
TRUSTEE AND THE CERTIFICATE REGISTRAR A CERTIFICATE STATING THAT SUCH
TRANSFEREE (A) AGREES TO BE BOUND BY AND TO ABIDE BY THE TRANSFER RESTRICTIONS
APPLICABLE TO THIS CERTIFICATE; (B) IS NOT AN ENTITY THAT WILL HOLD THIS
CERTIFICATE AS NOMINEE TO FACILITATE THE CLEARANCE AND SETTLEMENT OF SUCH
SECURITY THROUGH ELECTRONIC BOOK-ENTRY CHANGES IN ACCOUNTS OF PARTICIPATING
ORGANIZATIONS; AND (C) UNDERSTANDS THAT IT MUST TAKE INTO ACCOUNT ITS
PERCENTAGE INTEREST OF THE TAXABLE INCOME RELATING TO THIS CERTIFICATE.
A-2
68
UNION PLANTERS HOME EQUITY 20 -
CERTIFICATE
No. 0001
THIS CERTIFIES THAT ______________________ (the "Owner") is the
registered owner of a [100%] Percentage Interest of the Trust Interest in Union
Planters Home Equity Trust 20__-____ (the "Trust") existing under the laws of
the State of Delaware and created pursuant to that certain Deposit Trust
Agreement, dated as of __________ , 20__ (the "Trust Agreement"), among Union
Planters Home Equity Corp., as Depositor,
_____________________________________________, in its individual capacity and
in its fiduciary capacity as Owner Trustee under the Trust Agreement (the
"Owner Trustee"), _________________________________________________________, as
Trust Paying Agent and Bond Administrator, and _________________
_____________________________, as Servicer. Capitalized terms used but not
otherwise defined herein have the meanings assigned to such terms in the Trust
Agreement. The Owner Trustee, on behalf of the Issuer and not in its individual
capacity, has executed this Certificate by one of its duly authorized
signatories as set forth below. This Certificate is one of the Certificates
referred to in the Trust Agreement and 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 agrees and by which the
holder hereof is bound. Reference is hereby made to the Trust Agreement for the
rights of the holder of this Certificate, as well as for the terms and
conditions of the Trust created by the Trust Agreement.
The holder, by its acceptance hereof, agrees not to transfer this
Certificate except in accordance with terms and provisions of the Agreement.
A-3
69
THIS CERTIFICATE SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF
[DELAWARE], WITHOUT REFERENCE TO ITS CONFLICT OF LAW PROVISIONS, AND THE
OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED
IN ACCORDANCE WITH SUCH LAWS.
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.
UNION PLANTERS HOME EQUITY
TRUST 20___-___
By: ________________________, not in its
individual capacity but solely as Owner Trustee
under the Trust Agreement
By:
------------------------------------
Authorized Signatory
DATED: _________________ ___, 20__
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Agreement.
-----------------------------------
as Authenticating Agent
By:
--------------------------------
Authorized Signatory
A-4
70
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 Instrument, and all rights thereunder, hereby irrevocably
constituting and appointing ___________________________
Attorney to transfer said Instrument 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 Instrument in every particular, without
alteration, enlargement or any change whatever. Such signature must be
guaranteed by a member firm of the New York Stock Exchange or a commercial bank
or trust company.
A-5
71
EXHIBIT B
TO THE TRUST AGREEMENT
CERTIFICATE OF TRUST OF
UNION PLANTERS HOME EQUITY TRUST 20___-___
THIS CERTIFICATE OF TRUST OF UNION PLANTERS HOME EQUITY TRUST
20___-___ (THE "TRUST"), DATED AS OF _____________ __, 20___, IS BEING DULY
EXECUTED AND FILED BY ____________________, A _______________, AS TRUSTEE, TO
FORM A BUSINESS TRUST UNDER THE DELAWARE BUSINESS TRUST ACT (12 DEL. CODE,
S 3801 ET SEQ.).
1. Name. The name of the business trust formed hereby
is UNION PLANTERS HOME EQUITY TRUST 20___-___.
2. Delaware Trustee. The name and business address of
the trustee of the Trust in the State of Delaware is __________________________.
Attention: ____________________________.
IN WITNESS WHEREOF, the undersigned, being the sole trustee
of the Trust, has executed this Certificate of Trust as of the date first above
written.
_______________________________, not in its
individual capacity but solely as Owner
Trustee under a Deposit Trust Agreement,
dated as of ________ 20_
By:
----------------------------------------
Name:
----------------------------------------
Title:
-------------------------------------
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72
EXHIBIT C
FORM OF INVESTMENT LETTER
___________, 20__
Union Planters Home Equity Corp.
▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
[OWNER TRUSTEE]
[ADDRESS]
Re: Union Planters Home Equity Trust 20__-__ (the "Issuer")
Collateralized Mortgage Bonds
Ladies and Gentlemen:
___________________________________________________ (the
"Holder") has purchased or acquired, or intends to purchase or acquire from
______________, the current Holder (the "Current Holder"), a Certificate
representing a [___%] Percentage Interest (the "[__%] Certificate") in the
Trust Interest for the referenced Issuer, which represents an interest in the
Issuer created pursuant to that certain Deposit Trust Agreement, dated as of
______________ 20__ (the "Trust Agreement"), among Union Planters Home Equity
Corp., as Depositor, _______________, as Owner Trustee, _______________, as
Trust Paying Agent and Bond Administrator, and _______________, as Servicer.
Capitalized terms used and not otherwise defined herein have the meanings
assigned to such terms in the Trust Agreement.
CERTIFICATION
The undersigned, as an authorized officer or agent of the
Holder, hereby certifies, represents, warrants, and agrees on behalf of the
Holder as follows:
1. The Holder is duly organized, validly existing and in
good standing under the laws of the jurisdiction in which it was formed and is
authorized to invest in the [__%] Certificate. The person executing this letter
on behalf of the Holder is duly authorized to do so on behalf of the Holder.
C-1
73
2. The Holder hereby acknowledges that no transfer of
the [__%] Certificate may be made unless such transfer is exempt from the
registration requirements of the Securities Act of 1933, as amended (the
"Securities Act"), and applicable state securities laws, or is made in
accordance with the Securities Act and such laws.
3. The Holder understands that the [__%] Certificate has
not been and will not be registered under the Securities Act and may be
offered, sold, pledged or otherwise transferred only to a person whom the
transferor reasonably believes is (A) a qualified institutional buyer (as
defined in Rule 144A under the Securities Act) or (B) a Person involved in the
organization or operation of the Trust or an affiliate of such Person, in a
transaction meeting the requirements of Rule 144A under the Securities Act and
in accordance with any applicable securities laws of any state of the United
States. The Holder understands that the [__%] Certificate bears a legend to the
foregoing effect.
4. The Holder is acquiring the [__%] Certificate for its
own account or for accounts for which it exercises sole investment discretion,
and not with a view to or for sale or other transfer in connection with any
distribution of the [__%] Certificate in any manner that would violate Section
5 of the Securities Act or any applicable state securities laws, subject
nevertheless to any requirement of law that the disposition of the Holder's
property shall at all times be and remain within its control.
5. The Holder is (A) a "qualified institutional buyer"
(a "QIB") as defined in Rule 144A under the Securities Act, and is aware that
the transferor of the [__%] Certificate may be relying on the exemption from
the registration requirements of the Securities Act provided by Rule 144A and
is acquiring such [__%] Certificate for its own Account or for the Account of
one or more qualified institutional buyers for whom it is authorized to act, or
(B) a Person involved in the organization or operation of the Trust or an
affiliate of such Person within the meaning of Rule 3a-7 of the Investment
Company Act of 1940, as amended (including, but not limited to, the
Transferor). The Holder is able to bear the economic risks of such an
investment. The Holder is a QIB because [STATE FACTUAL BASIS FOR QIB STATUS]
6. If the Holder sells or otherwise transfers the
registered ownership of such [__%] Certificate, the Holder will comply with the
restrictions and requirements with respect to the transfer of the ownership of
the [__%] Certificate under the Trust Agreement, and the Holder will obtain
from any subsequent purchaser or transferee substantially the same
certifications, representations, warranties and covenants as required under the
Trust Agreement in connection with such subsequent sale or transfer thereof.
7. The Holder is not an entity that will hold a [__%]
Certificate as nominee (a "Book Entry Nominee") to facilitate the clearance and
settlement of such security through electronic book-entry changes in Accounts
or participating organizations.
8. The Holder is not (i) is not a person which is an
employee benefit plan, trust or account subject to Title I of the Employee
Retirement Income Security Act of 1974, as amended
C-2
74
("ERISA") or Section 4975 of the Code or a governmental plan, defined in
Section 3(32) of ERISA subject to any federal, state or local law which is, to
a material extent, similar to the foregoing provisions of ERISA or the Code
(any such person being a "plan") and (ii) is not an entity, including an
insurance company separate account or general account, whose underlying assets
include plan assets by reason of a plan's investment in the entity and is not
directly or indirectly purchasing such [__%] Certificate on behalf of, as
investment manager of, as named fiduciary of, as trustee of, or with assets of
a Plan.
9. The Holder hereby agrees to indemnify each of the Issuer,
the Indenture Trustee and the Owner Trustee against any liability that may
result if the Holder's transfer of a [__%] Certificate (or any portion thereof)
is not exempt from the registration requirements of the Securities Act and any
applicable state securities laws or is not made in accordance with such federal
and state laws. Such indemnification of the Issuer, the Owner Trustee shall
survive the termination of the related Trust Agreement.
IN WITNESS WHEREOF, the Holder has caused this instrument to
be executed on its behalf, pursuant to the authority of its Board of Directors,
by its duly authorized signatory this ___ day of _________, 20_.
[NAME OF HOLDER]
---------------------------------------
By:
------------------------------------
Name:
-----------------------------------
Title:
---------------------------------
C-3
75
EXHIBIT D
FEES AND EXPENSES OF OWNER TRUSTEE
D-1
76
EXHIBIT E
LOAN SCHEDULE
▇-▇
▇▇
▇▇▇▇▇▇▇ ▇
▇▇▇▇▇ RECEIPT
[Attached]
▇-▇
▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇▇ HOME EQUITY TRUST 20___-__
COLLATERALIZED MORTGAGE BONDS, SERIES 20___-__
CROSS RECEIPT BETWEEN UNION PLANTERS HOME EQUITY CO. AND UNION PLANTERS HOME
EQUITY TRUST 20___-__ ACKNOWLEDGING RECEIPT OF MORTGAGE BONDS
Reference is made to that certain Deposit Trust Agreement,
dated as of ______________ 20__ (the "Trust Agreement"), among Union Planters
Home Equity Co., as Depositor, ________________________, as Owner Trustee,
___________________, as Trust Paying Agent and Bond Administrator, and
___________, as Servicer. Capitalized terms used but not otherwise defined
herein shall have the meanings ascribed to such terms in the Trust Agreement.
The Trust hereby acknowledges receipt from the Company of the
Mortgage Bonds relating to the Mortgage Loans identified on the Loan Schedule
annexed as Exhibit E to the Trust Agreement (the "Mortgage Loans"). The
Mortgage Loans have an Initial Pool Balance of $_________________________.
UNION PLANTERS HOME EQUITY TRUST 20___-__
By: , not in its
--------------------------
individual capacity but solely as Owner
Trustee of the Trust
By:
----------------------------------
Authorized Signatory
The Company hereby acknowledges receipt of the Consideration
for the contribution of the Mortgage Loans by the Company to the Trust as
specified in the Trust Agreement. The Consideration consists of (a)
$_______________________, in immediately available funds, representing the
aggregate net proceeds from the sale of the Bonds delivered to the Placement
Agent pursuant to the Placement Agent Agreement, and (b) a Certificate,
delivered to ____________________, a ____________________________, representing
a 100% beneficial interest in the Trust.
-------------------------
By:
---------------------------------------
Name:
Title:
Dated: ________ __, 20__
E-3