exv4w4



 






EXHIBIT 4.4




	 	 	 
	 

	 	FINANCIAL GUARANTY
	 

	 	INSURANCE POLICY






	 	 	 	 	 
	OBLIGOR: Triad Automobile Receivables Trust 2007-A
	 	Policy No.:  51840A-N
	OBLIGATIONS: $775,110,000 Asset Backed Notes, Series 2007-A
	 	Date of Issuance:
	                        As described in Endorsement No. 1 hereto
	 	               May 30, 2007






     FINANCIAL SECURITY ASSURANCE INC. (“Financial Security”), for consideration received, hereby
UNCONDITIONALLY AND IRREVOCABLY GUARANTEES to each Holder, subject only to the terms of this Policy
(which includes each endorsement hereto), the full and complete payment by the Obligor of Scheduled
Payments of principal of, and interest on, the Obligations.



     For the further protection of each Holder, Financial Security irrevocably and unconditionally
guarantees:



     (a) payment of the amount of any distribution of principal of, or interest on, the
Obligations made during the Term Of This Policy to such Holder that is subsequently
avoided in whole or in part as a preference payment under applicable law (such payment to
be made by Financial Security in accordance with Endorsement No. 1 hereto).



     (b) payment of any amount required to be paid under this Policy by Financial
Security following Financial Security’s receipt of notice as described in Endorsement No.
1 hereto.



     Financial Security shall be subrogated to the rights of each Holder to receive payments under
the Obligations to the extent of any payment by Financial Security hereunder.



     Except to the extent expressly modified by an endorsement hereto, the following terms shall
have the meanings specified for all purposes of this Policy. “Holder” means the registered owner
of any Obligation as indicated on the registration books maintained by or on behalf of the Obligor
for such purpose or, if the Obligation is in bearer form, the holder of the Obligation. “Scheduled
Payments” means payments which are scheduled to be made during the Term Of This Policy in
accordance with the original terms of the Obligations when issued and without regard to any
amendment or modification of such Obligations thereafter; payments which become due on an
accelerated basis as a result of (a) a default by the Obligor, (b) an election by the Obligor to
pay principal on an accelerated basis or (c) any other cause, shall not constitute “Scheduled
Payments” unless Financial Security shall elect, in its sole discretion, to pay such principal due
upon such acceleration together with any accrued interest to the date of acceleration. “Term Of
This Policy” shall have the meaning set forth in Endorsement No. 1 hereto.



     This Policy sets forth in full the undertaking of Financial Security, and shall not be
modified, altered or affected by any other agreement or instrument, including any modification or
amendment thereto, or by the merger, consolidation or dissolution of the Obligor. Except to the
extent expressly modified by an endorsement hereto, the premiums paid in respect of this Policy are
nonrefundable for any reason whatsoever, including payment, or provision being made for payment, of
the Obligations prior to maturity. This Policy may not be canceled or revoked during the Term Of
This Policy. THIS POLICY IS NOT COVERED BY THE PROPERTY/CASUALTY INSURANCE SECURITY FUND SPECIFIED
IN ARTICLE 76 OF THE NEW YORK INSURANCE LAW.



     In witness whereof, FINANCIAL SECURITY ASSURANCE INC. has caused this Policy to be executed on
its behalf by its Authorized Officer.



	 	 	 	 	 
	 	FINANCIAL SECURITY ASSURANCE INC.

 	 
	 	By:  	/s/    Doug Watson
 	 
	 	 	Authorized Officer 	 
	 	 	 	 
	 






	 	 	 	 	 
	A subsidiary of Financial Security Assurance Holdings Ltd.

31 West 52nd Street, New York, N.Y. 10019-6161 	 	(212) 826-0100








Form 100NY (5/89)















 





ENDORSEMENT NO. 1 TO

FINANCIAL GUARANTY INSURANCE POLICY




			
	FINANCIAL SECURITY 

ASSURANCE INC.
	 	31 West 52nd Street

New York, New York 10019






	 	 	 
	OBLIGOR:
	 	Triad Automobile Receivables Trust 2007-A
	 
	 	 
	OBLIGATIONS:
	 	$150,000,000 Class A-1  5.3032% Asset Backed Notes
	 
	 	$278,000,000 Class A-2  5.35% Asset Backed Notes
	 
	 	$127,000,000 Class A-3  5.28% Asset Backed Notes
	 
	 	$220,110,000 Class A-4  Floating Rate Asset Backed Notes
	 
	 	 
	Policy No.:
	 	51840A-N
	 
	 	 
	Date of Issuance:
	 	May 30, 2007






     1. Definitions. For all purposes of this Policy, the terms specified below shall have
the meanings or constructions provided below. Capitalized terms used herein and not otherwise
defined herein shall have the meanings provided in the Indenture or the Sale and Servicing
Agreement unless otherwise specified.



     “Holder” shall have the meaning set forth in the Indenture; provided,
however that “Holder” shall not include the Obligor or any affiliates or successors thereof
in the event the Obligor, or any such affiliate or successor, is a registered or beneficial owner
of the Obligations.



     “Indenture” means the Indenture, dated as of May 30, 2007, between the Obligor and the
Indenture Trustee, as amended from time to time in accordance with the terms thereof.



     “Indenture Trustee” means Citibank, N.A., in its capacity as Indenture Trustee under
the Indenture and any successor in such capacity.



     “Policy” means this Financial Guaranty Insurance Policy and includes each endorsement.



     “Receipt” and “Received” mean actual delivery to Financial Security and to the
Fiscal Agent (as defined below), if any, prior to 12:00 noon, New York City time, on a Business
Day; delivery either on a day that is not a Business Day, or after 12:00 noon, New York City time,
shall be deemed to be received on the next succeeding Business Day. If any notice or certificate
given hereunder by the Indenture Trustee is not in proper form or is not properly completed,
executed or delivered, it shall be deemed not to have been Received, and Financial Security or its
Fiscal Agent shall promptly so advise the Indenture Trustee and the Indenture Trustee may submit an
amended notice.



 









 





			
	Policy No.: 51840A-N
	 	Date of Issuance: May 30, 2007






     “Sale and Servicing Agreement” means the Sale and Servicing Agreement dated as of May
30, 2007, among the Obligor, Triad Financial Special Purpose LLC, as Depositor, Triad Financial
Corporation, as Custodian and as Servicer, and Citibank, N.A., as Backup Servicer and as Indenture
Trustee, as such agreement may be amended, supplemented or otherwise modified from time to time in
accordance with the terms thereof.



     “Scheduled Payments” means, as to each Distribution Date, payments that are required
to be made to Holders in accordance with the original terms of the Obligations when issued and
without regard to any amendment or modification of the Obligations or of the Indenture except
amendments or modifications to which Financial Security has given its prior written consent, which
payments are (i) the Class A Noteholders’ Interest Distributable Amount with respect to the related
Distribution Date, (ii) the Class A Noteholders’ Parity Deficit Amount with respect to the related
Distribution Date and (iii) with respect to the Final Scheduled Distribution Date for any class of
Obligations, the outstanding principal amount of such class on such Final Scheduled Distribution
Date, after taking into account reductions on such date of such outstanding principal amount from
all sources other than this Policy. Scheduled Payments do not include payments that become due on
an accelerated basis as a result of (a) a default by the Obligor, (b) an election by the Obligor to
pay principal on an accelerated basis, (c) the occurrence of an Event of Default under the
Indenture or (d) any other cause, unless Financial Security elects, in its sole discretion, to pay
in whole or in part such principal due upon acceleration, together with any accrued interest to the
date of acceleration. In the event Financial Security does not so elect, this Policy will continue
to guarantee payment on the Obligations in accordance with their original terms. Scheduled
Payments shall not include (x) any portion of a Class A Noteholders’ Interest Distributable Amount
due to Holders because the appropriate notice and certificate for payment in proper form as
required by paragraph 2 hereof was not timely Received by Financial Security or (y) any portion of
a Class A Noteholders’ Interest Distributable Amount due to Holders representing interest on any
Class A Noteholders’ Interest Carryover Amount accrued from and including the date of payment of
the amount of such Class A Noteholders’ Interest Carryover Amount, unless in each case, Financial
Security elects, in its sole discretion, to pay such amount in whole or in part, pursuant hereto.
Scheduled Payments shall not include any amounts due in respect of the Obligations attributable to
any increase in interest rate, penalty or other sum payable by the Obligor by reason of any Default
or Event of Default in respect of the Obligations, or by reason of any deterioration of the
creditworthiness of the Obligor, nor shall Scheduled Payments include, nor shall coverage be
provided under this Policy in respect of, any taxes, withholding or other charge with respect to
any Holder imposed by any governmental authority due in connection with the payment of any
Scheduled Payment to a Holder.



     “Term Of This Policy” means the period from and including the Date of Issuance to and
including the date on which (i) all Scheduled Payments have been paid that are required to be paid
by the Obligor within the meaning of Section 4.1 of the Indenture; (ii) any period during which any
Scheduled Payment could have been avoided in whole or in part as a preference payment under
applicable bankruptcy, insolvency, receivership or similar law shall have expired and (iii) if any
proceedings requisite to avoidance as a



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	Policy No.: 51840A-N
	 	Date of Issuance: May 30, 2007





preference payment have been commenced prior to the occurrence of (i) and (ii), a final and
nonappealable order in resolution of each such proceeding has been entered.




     2. Notices and Conditions to Payment in Respect of Scheduled Payments. Following
Receipt by Financial Security of a notice and certificate from the Indenture Trustee in the form
attached as Exhibit A to this Endorsement, Financial Security will pay any amount payable hereunder
in respect of Scheduled Payments on the Obligations out of the funds of Financial Security on the
later to occur of (a) 12:00 noon, New York City time, on the second Business Day following such
Receipt; and (b) 12:00 noon, New York City time, on the date on which such payment is due on the
Obligations. Payments due hereunder in respect of Scheduled Payments will be disbursed to the
Indenture Trustee by wire transfer of immediately available funds.



     Financial Security shall be entitled to pay any amount hereunder in respect of Scheduled
Payments on the Obligations, including any amount due on the Obligations on an accelerated basis,
whether or not any notice and certificate shall have been Received by Financial Security as
provided above; provided, however, that by acceptance of this Policy the Indenture Trustee agrees
to provide to Financial Security, upon Financial Security’s request to the Indenture Trustee, a
notice and certificate in respect of any such payments made by Financial Security. Financial
Security shall be entitled to pay hereunder any amount that becomes due on the Obligations on an
accelerated basis at any time or from time to time after such amount becomes due, in whole or in
part, prior to the scheduled date of payment thereof. Scheduled Payments insured hereunder shall
not include interest, in respect of principal paid hereunder on an accelerated basis, accruing from
and after the date of such payment of principal. Financial Security’s obligations hereunder in
respect of Scheduled Payments shall be discharged to the extent such amounts are paid by the Issuer
in accordance with the Sale and Servicing Agreement or disbursed by Financial Security as provided
herein whether or not such funds are properly applied by the Indenture Trustee except as otherwise
provided in paragraph 3 of this Endorsement.



     3. Notices and Conditions to Payment in Respect of Scheduled Payments Avoided as
Preference Payments. If any Scheduled Payment is avoided as a preference payment under
applicable bankruptcy, insolvency, receivership or similar law, Financial Security will pay such
amount out of the funds of Financial Security on the later of (a) the date when due to be paid
pursuant to the Order referred to below or (b) the first to occur of (i) the fourth Business Day
following Receipt by Financial Security from the Indenture Trustee of (A) a certified copy of the
order (the “Order”) of the court or other governmental body that exercised jurisdiction to
the effect that the Holder is required to return Scheduled Payments made with respect to the
Obligations during the Term Of This Policy because such payments were avoidable as preference
payments under applicable bankruptcy law, (B) a certificate of the Holder that the Order has been
entered and is not subject to any stay and (C) an assignment duly executed and delivered by the
Holder, in such form as is reasonably required by Financial Security, and provided to the Holder by
Financial Security, irrevocably assigning to Financial Security all rights and claims of the Holder
relating to or arising under the Obligations against the estate of the Obligor or otherwise with
respect to such preference payment or (ii) the date of Receipt by Financial



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	Policy No.: 51840A-N
	 	Date of Issuance: May 30, 2007





Security from the Indenture Trustee of the items referred to in clauses (A), (B) and (C) above
if, at least four Business Days prior to such date of Receipt, Financial Security shall have
Received written notice from the Indenture Trustee that such items were to be delivered on such
date and such date was specified in such notice. Such payment shall be disbursed to the receiver,
conservator, debtor-in-possession or trustee in bankruptcy named in the Order and not to the
Indenture Trustee or any Holder directly (unless a Holder has previously paid such amount to the
receiver, conservator, debtor-in-possession or trustee in bankruptcy named in the Order, in which
case such payment shall be disbursed to the Indenture Trustee for distribution to such Holder upon
proof of such payment reasonably satisfactory to Financial Security). In connection with the
foregoing, Financial Security shall have the rights provided pursuant to Section 6.2 of the Sale
and Servicing Agreement.




     4. Governing Law. This Policy shall be governed by and construed in accordance with
the laws of the State of New York without giving effect to the conflict of laws principles thereof.



     5. Fiscal Agent. At any time during the Term Of This Policy, Financial Security may
appoint a fiscal agent (the “Fiscal Agent”) for purposes of this Policy by written notice
to the Indenture Trustee at the notice address specified in the Indenture specifying the name and
notice address of the Fiscal Agent. From and after the date of receipt of such notice by the
Indenture Trustee, (i) copies of all notices and documents required to be delivered to Financial
Security pursuant to this Policy shall be simultaneously delivered to the Fiscal Agent and to
Financial Security and shall not be deemed Received until Received by both, and (ii) all payments
required to be made by Financial Security under this Policy may be made directly by Financial
Security or by the Fiscal Agent on behalf of Financial Security. The Fiscal Agent is the agent of
Financial Security only and the Fiscal Agent shall in no event be liable to any Holder for any acts
of the Fiscal Agent or any failure of Financial Security to deposit, or cause to be deposited,
sufficient funds to make payments due under the Policy.



     6. Waiver of Defenses. To the fullest extent permitted by applicable law, Financial
Security agrees not to assert, and hereby waives, for the benefit of each Holder, all rights
(whether by counterclaim, setoff or otherwise) and defenses (including, without limitation, the
defense of fraud), whether acquired by subrogation, assignment or otherwise, to the extent that
such rights and defenses may be available to Financial Security to avoid payment of its obligations
under this Policy in accordance with the express provisions of this Policy. Nothing in this
paragraph shall be construed to limit or otherwise impair Financial Security’s right to pursue
recovery or claims (based on contractual rights, securities law violations, fraud or other causes
of action) against any person or entity, or to require payment by Financial Security of any amounts
that have been previously paid or that are not otherwise due in accordance with the express
provisions of this Policy or the Obligations. Nothing in this Policy shall be construed to require
payment to the extent any force majeure event or governmental act prevents Financial Security from
performing its obligations under this Policy or such performance is otherwise rendered impossible,
in which event Financial Security agrees to (i) use commercially reasonable efforts to perform its
obligations under this Policy



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	Policy No.: 51840A-N
	 	Date of Issuance: May 30, 2007





notwithstanding such force majeure event, governmental act or impossibility of performance and
(ii) perform its obligations under this Policy promptly following cessation of such force majeure
event, governmental act or impossibility of performance.




     7. Notices. All notices to be given hereunder shall be in writing (except as
otherwise specifically provided herein) and shall be mailed by registered mail or personally
delivered or telecopied to Financial Security as follows:


Financial Security Assurance Inc.

31 West 52nd Street

New York, New York 10019

Attention: Managing Director — Transaction Oversight

Re: Triad Automobile Receivables Trust 2007-A

Policy No.: 51840A-N

Telecopy No.: (212) 339-3518

Confirmation: (212) 826-0100




     Financial Security may specify a different address or addresses by writing mailed or delivered
to the Indenture Trustee.



     8. Priorities. In the event that any term or provision of the face of this Policy is
inconsistent with the provisions of this Endorsement, the provisions of this Endorsement shall take
precedence and shall be binding.



     9. Exclusions From Insurance Guaranty Funds. This Policy is not covered by the
Property/Casualty Insurance Security Fund specified in Article 76 of the New York Insurance Law.
This Policy is not covered by the Florida Insurance Guaranty Association created under Part II of
Chapter 631 of the Florida Insurance Code. In the event Financial Security were to become
insolvent, any claims arising under this Policy are excluded from coverage by the California
Insurance Guaranty Association, established pursuant to Article 14.2 of Chapter 1 of Part 2 of
Division 1 of the California Insurance Code.



     10. Surrender of Policy. The Indenture Trustee shall surrender this Policy to
Financial Security for cancellation upon expiration of the Term Of This Policy.



     IN WITNESS WHEREOF, FINANCIAL SECURITY ASSURANCE INC. has caused this Endorsement No. 1 to be
executed by its Authorized Officer.



	 	 	 	 	 
	 	FINANCIAL SECURITY ASSURANCE INC.

 	 
	By	/s/    Doug Watson
 	 
	 	Authorized Officer 	 
	 	 	 
	 



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	Policy No.: 51840A-N
	 	Date of Issuance: May 30, 2007






			
	 
	 
	 	EXHIBIT A

To Endorsement No. 1






NOTICE OF CLAIM AND CERTIFICATE




(Letterhead of Indenture Trustee)



Financial Security Assurance Inc.

31 West 52nd Street

New York, New York 10019




     Re:     Triad Automobile Receivables Trust 2007-A


        The undersigned, a duly authorized officer of Citibank, N.A. (the “Indenture
Trustee”), hereby certifies to Financial Security Assurance Inc. (“Financial
Security”), with reference to Financial Guaranty Insurance Policy No. 51840A-N dated May 30,
2007, (the “Policy”) issued by Financial Security in respect of $150,000,000 Class A-1
5.3032% Asset Backed Notes, $278,000,000 Class A-2 5.35% Asset Backed Notes, $127,000,000 Class A-3
5.28% Asset Backed Notes, $220,110,000 Class A-4 Floating Rate Asset Backed Notes of the
above-referenced Trust (the “Obligations”), that:




     (i) The Indenture Trustee is the Indenture Trustee for the Holders under the Indenture.



     (ii) The sum of all amounts on deposit (or scheduled to be on deposit) in the Note
Distribution Account and available for distribution to the Holders pursuant to the Section 5.8 of
the Sale and Servicing Agreement will be $                     (the “Shortfall”) less than the
aggregate amount of Scheduled Payments due on                                         .



     (iii) The Indenture Trustee is making a claim under the Policy for the Shortfall to be applied
to the payment of Scheduled Payments.



     (iv) The Indenture Trustee agrees that, following receipt of funds from Financial Security, it
shall (a) hold such amounts in trust and apply the same directly to the payment of Scheduled
Payments on the Obligations when due; (b) not apply such funds for any other purpose; (c) not
commingle such funds with other funds held by the Indenture Trustee and (d) maintain an accurate
record of such payments with respect to each Obligation and the corresponding claim on the Policy
and proceeds thereof, and, if the Obligation is required to be surrendered or presented for such
payment, shall stamp on each such Obligation the legend “$[insert applicable amount] paid by
Financial Security and the balance hereof has been cancelled and reissued” and then shall deliver
such Obligation to Financial Security.



     (v) The Indenture Trustee, on behalf of the Holders, hereby assigns to Financial Security the
rights of the Holders with respect to the Obligations to the extent of any payments under the
Policy. Without limitation of the foregoing, the Indenture Trustee, on behalf of the Holders,
hereby assigns to Financial Security any amounts due



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	Policy No.: 51840A-N
	 	Date of Issuance: May 30, 2007





to the Holders in respect of securities law violations arising from the offer and sale of the
Obligations. The foregoing assignment is in addition to, and not in limitation of, rights of
subrogation otherwise available to Financial Security in respect of such payments. Payments to
Financial Security in respect of the foregoing assignment shall in all cases be subject to and
subordinate to the rights of the Holders to receive all Scheduled Payments in respect of the
Obligations. The Indenture Trustee shall take such action and deliver such instruments as may be
reasonably requested or required by Financial Security to effectuate the purpose or provisions of
this clause (v).




     (vi) The Indenture Trustee, on behalf of the Holders, hereby appoints Financial Security as
agent and attorney-in-fact for the Indenture Trustee and each such Holder in any legal proceeding
with respect to the Obligations. The Indenture Trustee hereby agrees that, so long as an Insurer
Default (as defined in the Indenture) shall not exist, Financial Security may at any time during
the continuation of any proceeding by or against the Obligor under the United States Bankruptcy
Code or any other applicable bankruptcy, insolvency, receivership, rehabilitation or similar law
(an “Insolvency Proceeding”) direct all matters relating to such Insolvency Proceeding,
including without limitation, (A) all matters relating to any claim in connection with an
Insolvency Proceeding seeking the avoidance as a preferential transfer of any payment made with
respect to the Obligations (a “Preference Claim”), (B) the direction of any appeal of any
order relating to any Preference Claim at the expense of Financial Security but subject to
reimbursement as provided in the Insurance Agreement and (C) the posting of any surety, supersedeas
or performance bond pending any such appeal. In addition, the Indenture Trustee hereby agrees that
Financial Security shall be subrogated to, and the Indenture Trustee on its behalf and on behalf of
each Holder, hereby delegates and assigns, to the fullest extent permitted by law, the rights of
the Indenture Trustee and each Holder in the conduct of any Insolvency Proceeding, including,
without limitation, all rights of any party to an adversary proceeding or action with respect to
any court order issued in connection with any such Insolvency Proceeding.



     (vii) Payment should be made by wire transfer directed to [SPECIFY ACCOUNT].



     Unless the context otherwise requires, capitalized terms used in this Notice of Claim and
Certificate and not defined herein shall have the meanings provided in the Policy.



A-2









 





			
	Policy No.: 51840A-N
	 	Date of Issuance: May 30, 2007






     IN WITNESS WHEREOF, the Indenture Trustee has executed and delivered this Notice of Claim and
Certificate as of the ___th day of                    , 20___.



	 	 	 	 	 
	 

	 	CITIBANK, N.
	 	A., not in its individual
	 

	 	capacity, but
	 	 solely as Indenture Trustee
	 
	 	 	 	 
	 

	 	By	 	 
	 

	 	 	 	 
	 

	 	Title	 	 
	 

	 	 	 	 





For Financial Security or Fiscal Agent Use Only




Wire
transfer sent
on                     By                                         

Confirmation Number                                         




A-3