Document:

EX-4.2

Exhibit 4.2

EXECUTION COPY

AMERICAN HONDA RECEIVABLES CORP.,

as Depositor,

CITIBANK, N.A.,

as Owner Trustee

and

CITIGROUP TRUST-DELAWARE, NATIONAL ASSOCIATION,

as Delaware Trustee

 

AMENDED AND RESTATED

TRUST AGREEMENT

Dated May 12, 2009

 

 

 

TABLE OF CONTENTS

	 	 	 	 	 
	 	 	Page
	ARTICLE ONE
	 	 	 	 
	 
	 	 	 	 
	DEFINITIONS
	 	 	 	 
	 
	 	 	 	 
	Section 1.01. General Definitions
	 	 	1	 
	Section 1.02. Other Definitional Provisions
	 	 	5	 
	Section 1.03. Interpretive Provisions
	 	 	5	 
	 
	 	 	 	 
	ARTICLE TWO
	 	 	 	 
	 
	 	 	 	 
	ORGANIZATION
	 	 	 	 
	 
	 	 	 	 
	Section 2.01. Name
	 	 	5	 
	Section 2.02. Office
	 	 	6	 
	Section 2.03. Purposes and Powers
	 	 	6	 
	Section 2.04. Appointment of Owner Trustee and the Delaware Trustee
	 	 	7	 
	Section 2.05. Initial Capital Contribution of Owner Trust Estate
	 	 	7	 
	Section 2.06. Declaration of Trust
	 	 	7	 
	Section 2.07. Liability of Owners
	 	 	8	 
	Section 2.08. Title to Trust Property
	 	 	8	 
	Section 2.09. Situs of Issuer
	 	 	8	 
	Section 2.10. Representations and Warranties of the Depositor
	 	 	8	 
	 
	 	 	 	 
	ARTICLE THREE
	 	 	 	 
	 
	 	 	 	 
	TRUST CERTIFICATES AND TRANSFER OF INTERESTS
	 	 	 	 
	 
	 	 	 	 
	Section 3.01. Initial Ownership
	 	 	9	 
	Section 3.02. The Trust Certificates
	 	 	9	 
	Section 3.03. Authentication and Delivery of Trust Certificates
	 	 	10	 
	Section 3.04. Registration of Transfer and Exchange of Trust Certificates
	 	 	10	 
	Section 3.05. Mutilated, Destroyed, Lost or Stolen Trust Certificates
	 	 	12	 
	Section 3.06. Persons Deemed Owners
	 	 	12	 
	Section 3.07. Access to List of Certificateholders’ Names and Addresses
	 	 	12	 
	Section 3.08. Maintenance of Office or Agency
	 	 	13	 
	Section 3.09. Appointment of Paying Agent
	 	 	13	 
	Section 3.10. Definitive Trust Certificates
	 	 	13	 
	Section 3.11. Repayment of Trust Certificates
	 	 	14	 
	 
	 	 	 	 
	ARTICLE FOUR
	 	 	 	 
	 
	 	 	 	 
	ACTIONS BY OWNER TRUSTEE
	 	 	 	 
	 
	 	 	 	 
	Section 4.01. Prior Notice to Owners with Respect to Certain Matters
	 	 	14	 

i

 

	 	 	 	 	 
	 	 	Page
	Section 4.02. Action by Owners with Respect to Certain Matters
	 	 	14	 
	Section 4.03. Action by Owners with Respect to Bankruptcy
	 	 	15	 
	Section 4.04. Restrictions on Owners’ Power
	 	 	15	 
	Section 4.05. Majority Control
	 	 	15	 
	 
	 	 	 	 
	ARTICLE FIVE
	 	 	 	 
	 
	 	 	 	 
	APPLICATION OF TRUST FUNDS; CERTAIN DUTIES
	 	 	 	 
	 
	 	 	 	 
	Section 5.01. Establishment of Trust Account
	 	 	15	 
	Section 5.02. Application of Trust Funds
	 	 	16	 
	Section 5.03. Method of Payment
	 	 	16	 
	Section 5.04. No Segregation of Monies; No Interest
	 	 	16	 
	Section 5.05. Accounting and Reports to Owners, Internal Revenue Service and Others
	 	 	17	 
	 
	 	 	 	 
	ARTICLE SIX
	 	 	 	 
	 
	 	 	 	 
	AUTHORITY AND DUTIES OF OWNER TRUSTEE
	 	 	 	 
	 
	 	 	 	 
	Section 6.01. General Authority
	 	 	17	 
	Section 6.02. General Duties
	 	 	18	 
	Section 6.03. Action Upon Instruction
	 	 	18	 
	Section 6.04. No Duties Except as Specified in this Agreement or in Instructions
	 	 	19	 
	Section 6.05. No Action Except Under Specified Documents or Instructions
	 	 	19	 
	Section 6.06. Restrictions
	 	 	19	 
	 
	 	 	 	 
	ARTICLE SEVEN
	 	 	 	 
	 
	 	 	 	 
	CONCERNING THE OWNER TRUSTEE AND THE DELAWARE TRUSTEE
	 	 	 	 
	 
	 	 	 	 
	Section 7.01. Acceptance of Trusts and Duties
	 	 	19	 
	Section 7.02. Furnishing of Documents
	 	 	21	 
	Section 7.03. Representations and Warranties of the Owner Trustee and the Delaware Trustee
	 	 	21	 
	Section 7.04. Reliance, Advice of Counsel
	 	 	23	 
	Section 7.05. Not Acting in Individual Capacity
	 	 	23	 
	Section 7.06. Owner Trustee and Delaware Trustee Not Liable for Trust Certificates or Receivables

	 	 	23	 
	Section 7.07. Owner Trustee or Delaware Trustee May Own Trust Certificates and Notes
	 	 	24	 
	Section 7.08. Duties of the Delaware Trustee
	 	 	24	 
	 
	 	 	 	 
	ARTICLE EIGHT
	 	 	 	 
	 
	 	 	 	 
	COMPENSATION OF OWNER TRUSTEE AND THE DELAWARE TRUSTEE
	 	 	 	 
	 
	 	 	 	 
	Section 8.01. Owner Trustee’s and Delaware Trustee’s Fees and Expenses
	 	 	25	 
	Section 8.02. Indemnification
	 	 	25	 
	Section 8.03. Payments to the Owner Trustee and to the Delaware Trustee
	 	 	25	 

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	 	 	Page
	ARTICLE NINE
	 	 	 	 
	 
	 	 	 	 
	TERMINATION OF TRUST AGREEMENT
	 	 	 	 
	 
	 	 	 	 
	Section 9.01. Termination of Trust Agreement
	 	 	26	 
	 
	 	 	 	 
	ARTICLE TEN
	 	 	 	 
	 
	 	 	 	 
	SUCCESSOR AND ADDITIONAL OWNER TRUSTEES
	 	 	 	 
	 
	 	 	 	 
	Section 10.01. Eligibility Requirements for Owner Trustee and Delaware Trustee
	 	 	27	 
	Section 10.02. Resignation or Removal of Owner Trustee or Delaware Trustee
	 	 	27	 
	Section 10.03. Successor Owner Trustee or Delaware Trustee
	 	 	28	 
	Section 10.04. Merger or Consolidation of Owner Trustee or Delaware Trustee
	 	 	29	 
	Section 10.05. Appointment of Co-Trustee or Separate Trustee
	 	 	29	 
	 
	 	 	 	 
	ARTICLE ELEVEN
	 	 	 	 
	 
	 	 	 	 
	MISCELLANEOUS
	 	 	 	 
	 
	 	 	 	 
	Section 11.01. Supplements and Amendments
	 	 	31	 
	Section 11.02. No Legal Title to Owner Trust Estate in Owner
	 	 	32	 
	Section 11.03. Limitations on Rights of Others
	 	 	32	 
	Section 11.04. Notices
	 	 	32	 
	Section 11.05. Severability
	 	 	33	 
	Section 11.06. Separate Counterparts
	 	 	33	 
	Section 11.07. Successors and Assigns
	 	 	33	 
	Section 11.08. No Petition
	 	 	33	 
	Section 11.09. No Recourse
	 	 	33	 
	Section 11.10. Headings
	 	 	33	 
	Section 11.11. Governing Law; Submission to Jurisdiction
	 	 	33	 
	Section 11.12. Trust Certificates Nonassessable and Fully Paid
	 	 	34	 
	Section 11.13. Depositor Payment Obligation
	 	 	34	 
	Section 11.14. Tax Treatment
	 	 	34	 

iii

 

	 	 	 	 	 
	EXHIBITS
	 
	Exhibit A - Form of Trust Certificate
	 	 	A-1	 
	Exhibit B - Form of Seller Certificate
	 	 	B-1	 
	Exhibit C - Form of Investment Letter
	 	 	C-1	 
	Exhibit D - Form of Rule 144A Letter
	 	 	D-1	 

iv

 

     This Amended and Restated Trust Agreement, dated May 12, 2009, is between American Honda
Receivables Corp., a California corporation, as depositor (the “Depositor”), Citibank,
N.A., as owner trustee (the “Owner Trustee”) and Citigroup Trust-Delaware, National
Association, as Delaware trustee (the “Delaware Trustee”).

     WHEREAS, Honda Auto Receivables 2009-2 Owner Trust has been created pursuant to a trust
agreement, dated as of April 23, 2009 among the Depositor, the Owner Trustee and the Delaware
Trustee (the “Initial Trust Agreement”); and

     WHEREAS, the parties hereto are entering into this amended and restated trust agreement
pursuant to which, among other things, the Initial Trust Agreement will be amended and restated and
$66,582,876.59, aggregate principal amount of Asset Backed Certificates will be issued;

     NOW, THEREFORE, in consideration of the mutual agreements herein contained, and of other good
and valuable consideration, the receipt and adequacy of which are hereby acknowledged, the parties
hereto agree as follows:

ARTICLE ONE

DEFINITIONS

     Section 1.01. General Definitions. Whenever used herein, unless the context otherwise
requires, the following words and phrases shall have the following meanings:

     “Administration Agreement” means the administration agreement, dated as of May 1,
2009, among the Issuer, the Indenture Trustee, the Depositor and AHFC, as amended or supplemented
from time to time.

     “Administrator” means AHFC, as Administrator under the Administration Agreement, and
its successors in such capacity.

     “Agreement” means this Amended and Restated Trust Agreement, as the same may be
amended and supplemented from time to time.

     “AHFC” means American Honda Finance Corporation, and its successors.

     “AHRC” means American Honda Receivables Corp., and its successors.

     “Applicants” shall have the meaning specified in Section 3.07.

     “Benefit Plan Investor” means (i) an employee benefit plan (as such term is defined in
Section 3(3) of ERISA) whether or not subject to the provisions of Title I of ERISA, (ii) a plan
described in Section 4975(e)(1) of the Code or (iii) any entity whose underlying assets include
assets of a plan described in (i) or (ii) by reason of such plan’s investment in the entity.

 

 

     “Business Day” means any day other than a Saturday, a Sunday or a day on which banking
institutions or trust companies in Los Angeles, California, Wilmington, Delaware or New York, New
York are authorized or obligated by law, regulation, executive order or governmental decree to
remain closed.

     “Certificate Balance” means, with respect to any Trust Certificate, the original
certificate balance of such Trust Certificate minus all payments on such Trust Certificate with
respect to principal.

     “Certificate Distribution Account” means the account established and maintained as
such pursuant to Section 5.01.

     “Certificate of Trust” means the Certificate of Trust filed for the Issuer pursuant to
Section 3810(a) of the Statutory Trust Statute, substantially in the form of Exhibit A to the
Initial Trust Agreement.

     “Certificate Rate” means 0.00% per annum calculated on the basis of a 360 day year of
twelve 30 day months.

     “Certificate Register” and “Certificate Registrar” means the register
maintained and the registrar (or any successor thereto) appointed pursuant to Section 3.04.

     “Certificateholder” or “Holder” means a Person in whose name a Trust
Certificate is registered.

     “Closing Date” means May 12, 2009.

     “Code” means the Internal Revenue Code of 1986, as amended, and Treasury Regulations
promulgated thereunder.

     “Commission” means the Securities and Exchange Commission, and its successors.

     “Corporate Trust Office” means, with respect to the Owner Trustee, the principal
corporate trust office of the Owner Trustee located at Citibank, N.A., 388 Greenwich Street,
14th Floor, New York, New York 10013, Attention: Structured Finance Agency & Trust:
Honda Auto Receivables 2009-2, or at such other address as the Owner Trustee may designate by
notice to the Owners and, the Depositor, or the principal corporate trust office of any successor
Owner Trustee at the address designated by such successor Owner Trustee by notice to the Owners and
the Depositor.

     “Delaware Trustee” means Citigroup Trust-Delaware, National Association, with its
principal place of business in the State of Delaware, not in its individual capacity, but solely as
Delaware Trustee under this Agreement, and any successor Delaware Trustee hereunder.

     “Depositor” means AHRC in its capacity as depositor hereunder.

     “DTC” means The Depository Trust Company, and its successors.

2

 

     “ERISA” means the Employee Retirement Income Security Act of 1974, as amended.

     “Exchange Act” means the Securities Exchange Act of 1934, as amended.

     “Expenses” means all liabilities, obligations, losses, damages, taxes, claims, actions
and suits, and any and all reasonable out of pocket costs, expenses and disbursements (including
reasonable legal fees and expenses) of any kind and nature whatsoever.

     “Indemnified Parties” means the Owner Trustee and its successors, assigns, agents and
the Delaware Trustee and its successors, assigns, agents, the Paying Agent, the Certificate
Registrar, any authenticating agent and any co-trustee.

     “Indenture” means the indenture dated as of May 1, 2009 between the Issuer and
Deutsche Bank Trust Company Americas, as indenture trustee.

     “Investment Letter” means a letter delivered in connection with the transfer of a
Trust Certificate pursuant to Section 3.04(a), substantially in the form of Exhibit C.

     “Issuer” means the Honda Auto Receivables 2009-2 Owner Trust, and its successors.

     “Opinion of Counsel” means one or more written opinions of counsel, who may be an
employee of or counsel to the Seller, the Depositor or the Servicer, which counsel shall be
acceptable to the Indenture Trustee, the Owner Trustee or each Rating Agency, as applicable.

     “Original Certificate Balance” means $66,582,876.59.

     “Original Contribution Amount” means $1,000.

     “Owner” means each Holder of a Trust Certificate.

     “Owner Trust Estate” means all right, title and interest of the Issuer in and to the
property and rights assigned to the Issuer pursuant to Article Two of the Sale and Servicing
Agreement, all funds on deposit from time to time in the Accounts and the Certificate Distribution
Account, all other property of the Issuer from time to time, including any rights of the Owner
Trustee and the Issuer pursuant to the Sale and Servicing Agreement and the Administration
Agreement and all proceeds of the foregoing.

     “Owner Trustee” means Citibank, N.A., not in its individual capacity but solely as
owner trustee under this Agreement, and any successor Owner Trustee hereunder.

     “Paying Agent” means any paying agent or co-paying agent appointed pursuant to Section
3.09.

     “Payment Date” means the 15th calendar day of each month, commencing June
15, 2009, or if such day is not a Business Day, then the next succeeding Business Day.

3

 

     “Percentage Interest” means, as to any Trust Certificate, (i) the original certificate
balance for such Trust Certificate, as specified on the face thereof, divided by (ii) the Original
Certificate Balance; provided, that in determining whether the Holders of the requisite portion or
percentage of the Trust Certificates have given any request, demand, authorization, direction,
notice, consent or waiver hereunder or under any other Basic Document, Trust Certificates owned by
the Issuer, any other obligor upon the Certificates, the Seller, the Servicer or any Affiliate of
any of the foregoing Persons shall be disregarded and deemed to be excluded from the Certificate
Balance (unless such Persons own 100% of the Trust Certificates), except that, in determining
whether the Indenture Trustee and Owner Trustee shall be protected in relying on any such request,
demand, authorization, direction, notice, consent or waiver, only Trust Certificates that a
Responsible Officer of the Indenture Trustee and the Owner Trustee have actual knowledge of being
so owned shall be so disregarded. Trust Certificates so owned that have been pledged in good faith
may be regarded as included in the Certificate Balance if the pledgee establishes to the
satisfaction of the Indenture Trustee or the Owner Trustee, as applicable, the pledgee’s right so
to act with respect to such Trust Certificates and that the pledgee is not the Issuer, any other
obligor upon the Trust Certificates, the Seller or any Affiliate of any of their respective
Affiliates. Neither the Indenture Trustee nor the Owner Trustee shall incur any liability to any
person in determining whether a pledgee has the right to act with respect to such Trust
Certificates.

     “Rating Agency” has the meaning set forth in the Sale and Servicing Agreement.

     “Record Date” means the day immediately preceding the Payment Date so long as the
securities are in book-entry form, and the last day of the month preceding the Payment Date if the
securities are issued in definitive form.

     “Required Rating” means, with respect to any entity, that such entity (or the parent
of such entity) has a rating of at least BBB+ by Fitch, Inc. or at least BBB- by Standard & Poor’s
Ratings Services, a division of the McGraw-Hill Companies.

     “Rule 144A Letter” means a letter delivered in connection with the transfer of a Trust
Certificate pursuant to Section 3.04(a), substantially in the form attached hereto as Exhibit D.

     “Sale and Servicing Agreement” means the sale and servicing agreement, dated as of May
1, 2009, among the Issuer, the Depositor and AHFC, as servicer, as amended or supplemented from
time to time.

     “Secretary of State” means the Secretary of State of the State of Delaware.

     “Securities Act” means the Securities Act of 1933, as amended.

     “Seller Certificate” means a certificate of transfer delivered in connection with the
transfer of a Trust Certificate pursuant to Section 3.04(a), substantially in the form of Exhibit
B.

     “Statutory Trust Statute” means Chapter 38 of Title 12 of the Delaware Code, 12
Del.C. § 3801 et seq., as the same may be amended from time to time.

4

 

     “Treasury Regulations” means 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 Certificate” means a certificate evidencing the beneficial interest of an Owner
in the Trust, substantially in the form of Exhibit A.

     Section 1.02. Other Definitional Provisions.

     (a) Capitalized terms used herein that are not otherwise defined have the meanings ascribed
thereto in the Sale and Servicing Agreement or the Indenture, as the case may be.

     (b) All terms defined in this Agreement shall have the defined meanings when used in any
certificate or other document made or delivered pursuant hereto unless otherwise defined therein.

     Section 1.03. Interpretive Provisions.

     (a) For all purposes of this Agreement, except as otherwise expressly provided or unless the
context otherwise requires, (i) terms used herein include, as appropriate, all genders and the
plural as well as the singular, (ii) references to words such as “herein”, “hereof” and the like
shall refer to this Agreement as a whole and not to any particular part, article or section within
this Agreement, (iii) references to a section such as “Section 1.01” and the like shall refer to
the applicable Section of this Agreement, (iv) the term “include”, and all variations thereof shall
mean “include without limitation”, (v) the term “or” shall include “and/or” and (vi) the term
“proceeds” shall have the meaning set forth in the applicable UCC.

     (b) As used in this Agreement and in any certificate or other document made or delivered
pursuant hereto or thereto, accounting terms not defined in this Agreement or in any such
certificate or other document, and accounting terms partly defined in this Agreement or in any such
certificate or other document to the extent not defined, shall have the respective meanings given
to them under generally accepted accounting principles. To the extent that the definitions of
accounting terms in this Agreement or in any such certificate or other document are inconsistent
with the meanings of such terms under generally accepted accounting principles, the definitions
contained in this Agreement or in any such certificate or other document shall control.

ARTICLE TWO

ORGANIZATION

     Section 2.01. Name. The trust created hereby shall be known as the “Honda Auto
Receivables 2009-2 Owner Trust”, in which name the Owner Trustee may conduct the business of the
Issuer, make and execute contracts and other instruments and sue and be sued, to the extent herein
provided.

5

 

     Section 2.02. Office. The Delaware office of the Issuer shall be in care of the
Delaware Trustee at 222 Delaware Avenue, 14th Floor, Wilmington, Delaware 19801, or at such other
address in the State of Delaware as the Delaware Trustee may designate by written notice to the
Owners and the Depositor. The New York, New York office of the Issuer shall be in care of the
Owner Trustee at the Corporate Trust Office or at such other address in New York as the Owner
Trustee may designate by written notice to the Owners and the Depositor.

     Section 2.03. Purposes and Powers.

     (a) The sole purpose of the Issuer is to conserve the Owner Trust Estate and collect and
disburse the periodic income therefrom for the use and benefit of the Certificateholders, and in
furtherance of such purpose to engage in the following ministerial activities:

     (i) to issue the Notes pursuant to the Indenture and the Trust Certificates pursuant to
this Agreement and to sell the Notes and the Trust Certificates;

     (ii) with the proceeds of the sale of the Notes and the Trust Certificates, to purchase
the Receivables, to fund the Reserve Fund and the Yield Supplement Account, to pay the
organizational, start-up and transactional expenses of the Trust and to pay the balance to
the Depositor pursuant to the Sale and Servicing Agreement;

     (iii) to assign, grant, transfer, pledge, mortgage and convey the Owner Trust Estate
pursuant to the Indenture and to hold, manage and distribute to the Owners pursuant to the
Sale and Servicing Agreement any portion of the Owner Trust Estate released from the Lien
of, and remitted to the Trust pursuant to, the Indenture;

     (iv) to enter into and perform its obligations under the Basic Documents to which it is
to be a party;

     (v) to engage in those activities, including entering into agreements, that are
necessary to accomplish the foregoing or are incidental thereto or connected therewith,
including entering into interest rate swap agreements, interest rate cap agreements and
other derivative instruments;

     (vi) subject to compliance with the Basic Documents, to engage in such other activities
as may be required in connection with conservation of the Owner Trust Estate and the making
of distributions to the Owners and the Noteholders; and

     (vii) if so directed by the Administrator, and subject to the Rating Agency Condition,
to enter into one or more Cap Agreements with one or more Cap Counterparties to hedge some
or all of the interest rate risk of the Notes.

     (b) The Issuer is hereby authorized to engage in the foregoing activities. The Issuer shall
not engage in any activities, including, without limitation, assuming or incurring any indebtedness
(with the exception of Notes), other than in connection with the foregoing or other than as
required or authorized by the terms of this Agreement or the other Basic Documents.

6

 

     Section 2.04. Appointment of Owner Trustee and the Delaware Trustee. The Depositor
hereby appoints the Owner Trustee as trustee of the Issuer effective as of the date hereof, to have
all the rights, powers and duties set forth herein, and the Owner Trustee hereby accepts such
appointment. The Depositor hereby appoints the Delaware Trustee as a trustee of the Issuer
effective as of the date hereof, for the sole purpose of satisfying Section 3807(a) of the Delaware
Statutory Trust Statute, and the Delaware Trustee hereby accepts such appointment. The Owner
Trustee may engage, in the name of the Issuer or in its own name on behalf of the Issuer, in the
activities of the Issuer, make and execute contracts on behalf of the Issuer and sue on behalf of
the Issuer.

     Section 2.05. Initial Capital Contribution of Owner Trust Estate. The Depositor
hereby reaffirms its sale, assignment, transfer and conveyance to the Owner Trustee, as of the date
of the Initial Trust Agreement, the sum of $1,000.00 (the “Original Contribution Amount”). The
Owner Trustee hereby reaffirms its receipt in trust from the Depositor, as of the date of the
Initial Trust Agreement, of the Original Contribution Amount, which constituted the initial Owner
Trust Estate and shall be on or before the date hereof deposited in the Certificate Distribution
Account. On the date hereof the Owner Trustee is hereby directed to withdraw the Original
Contribution Amount from the Certificate Distribution Account and transfer such sums to the
Depositor via wire transfer to the Depositor’s account from which the Original Contribution Amount
was received. The Depositor shall pay organizational expenses of the Issuer as they may arise or
shall, upon the request of the Owner Trustee, promptly reimburse the Owner Trustee for any such
expenses paid by the Owner Trustee.

     Section 2.06. Declaration of Trust. The Owner Trustee hereby declares that it will
hold the Owner Trust Estate in trust upon and subject to the conditions set forth herein for the
sole purpose of conserving the Owner Trust Estate and collecting and disbursing the periodic income
therefrom for the use and benefit of the Owners, subject to the obligations of the Issuer under the
Basic Documents. It is the intention of the parties hereto that the Issuer constitute a statutory
trust under the Statutory Trust Statute and that this Agreement constitute the governing instrument
of such statutory trust. It is the intention of the parties hereto that, solely for income and
franchise tax purposes, (i) so long as there is a sole Owner, the Issuer shall be disregarded as an
entity separate from the owner, with the assets of the Issuer being the Receivables and other
assets held by the Issuer, the owner of the Receivables being the sole Owner and the Notes being
non-recourse debt of the sole Owner and (ii) if there is more than one Owner, the Issuer shall be
treated as a partnership for income and franchise tax purposes, with the assets of the partnership
being the Receivables and other assets held by the Issuer and with the partners of the partnership
being the Owners and the Notes being debt of the partnership. The parties agree that, unless
otherwise required by appropriate tax authorities, the Issuer will file or cause to be filed annual
or other necessary returns, reports and other forms consistent with the characterization of the
Issuer as provided in the preceding sentence for such tax purposes. Effective as of the date
hereof, the Owner Trustee and the Delaware Trustee, as applicable, shall have all rights, powers
and duties set forth herein and in the Statutory Trust Statute for the sole purpose and to the
extent necessary to accomplish the purpose of the Issuer as set forth in Section 2.03(a).

7

 

     Section 2.07. Liability of Owners. The Owners shall be entitled to the same
limitation of personal liability extended to stockholders of private corporations for profit
organized under the general corporation law of the State of Delaware.

     Section 2.08. Title to Trust Property. Legal title to the Owner Trust Estate shall be
vested at all times in the Issuer as a separate legal entity except where applicable law in any
jurisdiction requires title to any part of the Owner Trust Estate to be vested in a trustee or
trustees, in which case title shall be deemed to be vested in the Owner Trustee, a co-trustee
and/or a separate trustee, as the case may be.

     Section 2.09. Situs of Issuer. The Issuer will be located in the State of Delaware.
All bank accounts maintained by the Owner Trustee on behalf of the Issuer shall be located in the
states of Delaware or New York. The Issuer shall not have any employees in any state other than
Delaware; provided, however, that nothing herein shall restrict or prohibit the Owner Trustee from
having employees within or without the State of Delaware. Payments will be received by the Issuer
only in, and payments will be made by the Issuer only from, the states of Delaware or New York.
The only offices of the Issuer will be at the Corporate Trust Office and at the office of the
Delaware Trustee, located at 222 Delaware Avenue, 14th Floor, Wilmington, Delaware
19801.

     Section 2.10. Representations and Warranties of the Depositor. The Depositor hereby
represents and warrants to the Owner Trustee and Delaware Trustee that:

     (a) The Depositor has been duly organized and is validly existing as a corporation in good
standing under the laws of the State of California, 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, and had at all relevant times, and has, power, authority and legal right to acquire, own
and sell the Receivables.

     (b) The Depositor is duly qualified to do business as a foreign corporation in good standing,
and has obtained all necessary licenses and approvals in all jurisdictions in which the ownership
or lease of its property or the conduct of its business shall require such qualifications.

     (c) The Depositor has the power and authority to execute and deliver this Agreement and to
carry out its terms; the Depositor has full power and authority to sell and assign the property to
be sold and assigned to and deposited with the Owner Trustee as part of the Owner Trust Estate and
the Depositor has duly authorized such sale and assignment and deposit to the Issuer by all
necessary corporate action; and the execution, delivery and performance of this Agreement have been
duly authorized by the Depositor by all necessary corporate action.

     (d) This Agreement constitutes a legal, valid and binding obligation of the Depositor,
enforceable in accordance with its terms, except as such enforceability may be subject to or
limited by bankruptcy, insolvency, reorganization, moratorium, liquidation, fraudulent conveyance
or other similar laws affecting the enforcement of creditors’ rights in general and by general
principles of equity, regardless of whether such enforceability shall be considered in a proceeding
in equity or in law.

8

 

     (e) The execution, delivery and performance by the Depositor of this Agreement and 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, nor
constitute (with or without notice or lapse of time) a default under, the articles of incorporation
or bylaws of the Depositor, or conflict with or violate any of the material terms or provisions of,
or constitute (with or without notice or lapse of time) a default under, any indenture, agreement
or other instrument to which the Depositor is a party or by which it is bound; nor result in the
creation or imposition of any Lien upon any of its properties pursuant to the terms of any such
indenture, agreement or other instrument (other than pursuant to the Basic Documents); nor violate
any law or, to the best of the Depositor’s knowledge, any order, rule or regulation applicable to
the Depositor of any court or of any federal or state regulatory body, administrative agency or
other governmental instrumentality having jurisdiction over the Depositor or its properties; which
breach, default, conflict, lien or violation would have a material adverse effect on the earnings,
business affairs or business prospects of the Depositor.

     (f) There are no proceedings or investigations pending or, to the Depositor’s knowledge,
threatened, before any court, regulatory body, administrative agency or other governmental
instrumentality having jurisdiction over the Depositor or its properties: (i) asserting the
invalidity of this Agreement, (ii) seeking to prevent the issuance of the Trust Certificates or the
consummation of any of the transactions contemplated by this Agreement or (iii) seeking any
determination or ruling that might materially and adversely affect the performance by the Depositor
of its obligations under, or the validity or enforceability of, this Agreement.

ARTICLE THREE

TRUST CERTIFICATES AND TRANSFER OF INTERESTS

     Section 3.01. Initial Ownership. Upon the formation of the Issuer by the contribution
by the Depositor pursuant to Section 2.05 and until the issuance of the Trust Certificates, the
Depositor shall be the sole beneficiary of the Issuer.

     Section 3.02. The Trust Certificates. The Trust Certificates shall be issued in
minimum denominations of $100,000 and integral multiples thereof; provided, however, that one Trust
Certificate may be issued in such denomination as required to include any residual amount. The
Trust Certificates shall be executed by the Owner Trustee on behalf of the Issuer by manual or
facsimile signature of an authorized officer of the Owner Trustee and shall have deemed to have
been validly issued when so executed and authenticated (as set forth in Section 3.03 below). Trust
Certificates bearing the manual or facsimile signatures of individuals who were, at the time when
such signatures were affixed, authorized to sign on behalf of the Owner Trustee, shall be validly
issued and binding obligations of the Issuer and entitled to the benefit of this Agreement,
notwithstanding that such individuals or any of them shall have ceased to be so authorized prior to
the authentication and delivery of such Trust Certificates or did not hold such offices at the date
of authentication and delivery of such Trust Certificates.

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     A transferee of a Trust Certificate shall become a Certificateholder and shall be entitled to
the rights and subject to the obligations of a Certificateholder hereunder upon such transferee’s
acceptance of a Trust Certificate duly registered in such transferee’s name pursuant to Section
3.04.

     Section 3.03. Authentication and Delivery of Trust Certificates. On the Closing Date,
the Owner Trustee shall cause to be authenticated and delivered upon the order of the Depositor, in
exchange for the Receivables and the other assets of the Issuer, simultaneously with the sale,
assignment and transfer to the Issuer of the Receivables, and the constructive delivery to the
Issuer of the Receivable Files and the other assets of the Issuer, Trust Certificates duly
authenticated by the Owner Trustee, in authorized denominations equaling in the aggregate the
Original Certificate Balance and evidencing the entire ownership of the Issuer. No Trust
Certificate shall entitle its Holder to any benefit under this Agreement, or be valid for any
purpose, unless there shall appear on such Trust Certificate a certificate of authentication
substantially in the form set forth in Exhibit A, executed by the Owner Trustee or the Trust’s
authenticating agent, by manual signature; and such authentication shall constitute conclusive
evidence that such Trust Certificate shall have been duly authenticated and delivered hereunder.
All Trust Certificates shall be dated the date of their authentication. Upon issuance,
authentication and delivery pursuant to the terms hereof, the Trust Certificates will be entitled
to the benefits of this Agreement. Whenever, in any Basic Document, a reference is made to
authentication by the Owner Trustee, such reference shall include authentication by the Owner
Trustee and/or authentication by a party appointed to act as the authenticating agent of the Owner
Trustee. Citibank, N.A. shall act as initial authenticating agent.

     Section 3.04. Registration of Transfer and Exchange of Trust Certificates.

     (a) The Certificate Registrar shall keep or cause to be kept, at the office or agency
maintained pursuant to Section 3.08, a Certificate Register in which, subject to such reasonable
regulations as it may prescribe, it shall provide for the registration of Trust Certificates and of
transfers and exchanges of Trust Certificates as herein provided. Citibank, N.A. shall act as
initial Certificate Registrar. The Owner Trustee may appoint an agent to act as Certificate
Registrar. Upon any resignation of the Certificate Registrar, the Owner Trustee shall promptly
appoint a successor thereto.

     The Trust Certificates have not been registered under the Securities Act or listed on any
securities exchange. No transfer of a Trust Certificate shall be made unless such transfer is made
pursuant to an effective registration statement under the Securities Act and any applicable state
securities laws or is exempt from the registration requirements under the Securities Act and such
state securities laws. In the event that a transfer is to be made in reliance upon an exemption
from the Securities Act and state securities laws, in order to assure compliance with the
Securities Act and such laws, the Holder desiring to effect such transfer and such Holder’s
prospective transferee shall each certify to the Issuer in writing the facts surrounding the
transfer in the form of a Seller Certificate and Investment Letter or a Rule 144A Letter. Except
in the case of a transfer as to which the proposed transferee has provided a Rule 144A Letter,
there shall also be delivered to the Issuer an Opinion of Counsel that such transfer may be made
pursuant to an exemption from the Securities Act and an Opinion of Counsel or memorandum of

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law that such transfer may be made pursuant to an exemption from state securities laws, which
Opinion(s) of Counsel and memorandum of law shall not be an expense of the Issuer or the Owner
Trustee. The Depositor shall provide to any Holder of a Trust Certificate and any prospective
transferee designated by any such Holder, information regarding the Trust Certificates and the
Receivables and such other information as shall be necessary to satisfy the condition to
eligibility set forth in Rule 144A(d)(4) for transfer of any such Trust Certificate without
registration thereof under the Securities Act pursuant to the registration exemption provided by
Rule 144A. Each Holder of a Trust Certificate desiring to effect such a transfer shall, and does
hereby agree to, indemnify the Issuer, the Owner Trustee and the Depositor against any liability
that may result if the transfer is not so exempt or is not made in accordance with federal and
state securities laws. The Owner Trustee on behalf of the Issuer shall cause each Trust
Certificate to contain a legend in the form set forth on the form of Trust Certificate attached
hereto as Exhibit A.

     (b) Upon surrender for registration of transfer of any Trust Certificate at the office of the
Certificate Registrar and subject to the satisfaction of the preceding paragraph, 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 Trust
Certificates in authorized denominations of a like aggregate original certificate balance dated the
date of authentication by the Owner Trustee or any authenticating agent; provided that prior to
such execution, authentication and delivery, the Owner Trustee shall have received an Opinion of
Counsel to the effect that the proposed transfer will not cause the Issuer to be characterized, as
an association (or a publicly traded partnership) taxable as a corporation or alter the tax
characterization of the Notes for federal income tax purposes. At the option of a Holder, Trust
Certificates may be exchanged for other Trust Certificates of authorized denominations of a like
aggregate original certificate balance upon surrender of the Trust Certificates to be exchanged at
the office or agency maintained pursuant to Section 3.08.

     (c) At the option of a Certificateholder, Trust Certificates may be exchanged for other Trust
Certificates in authorized denominations of a like aggregate original certificate balance upon
surrender of the Trust Certificates to be exchanged at the office of the Certificate Registrar.
Whenever any Trust Certificates are so surrendered for exchange, the Owner Trustee on behalf of the
Issuer shall execute, authenticate and deliver (or shall cause its authenticating agent to
authenticate and deliver) the Trust Certificates that the Certificateholder making the exchange is
entitled to receive. Every Trust Certificate presented or surrendered for registration of transfer
or exchange shall be accompanied by a written instrument of transfer in form satisfactory to the
Owner Trustee and the Certificate Registrar duly executed by the Holder or such Holder’s attorney
duly authorized in writing.

     (d) No service charge shall be made for any registration of transfer or exchange of Trust
Certificates, but the Owner Trustee (or the Paying Agent) 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 Trust Certificates.

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     (e) The Trust Certificates may not be acquired or held by or for the account of a Benefit Plan
Investor. No transfer of a Trust Certificate shall be made unless the prospective transferee has
certified to the Issuer in writing that it is not a Benefit Plan Investor.

     (f) All Trust Certificates surrendered for registration of transfer or exchange, if
surrendered to the Issuer or any agent of the Owner Trustee or the Issuer under this Agreement,
shall be delivered to the Owner Trustee and promptly cancelled by it, or, if surrendered to the
Owner Trustee, shall be promptly cancelled by it, and no Trust Certificates shall be issued in lieu
thereof except as expressly permitted by any of the provisions of this Agreement. The Owner
Trustee shall dispose of cancelled Trust Certificates in accordance with its normal practice.

     (g) The preceding provisions of this Section notwithstanding, the Owner Trustee shall not
make, and the Certificate Registrar shall not register transfers or exchanges of, Trust
Certificates for a period of 15 days preceding the due date for any payment with respect to the
Trust Certificates.

     Section 3.05. Mutilated, Destroyed, Lost or Stolen Trust Certificates. If (i) any
mutilated Trust Certificate is surrendered to the Certificate Registrar, or the Certificate
Registrar receives evidence to its satisfaction of the destruction, loss or theft of any Trust
Certificate and (ii) there is 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 to a Responsible Officer of the Owner Trustee that such Trust Certificate has
been acquired by a bona fide purchaser, the Owner Trustee on behalf of the Issuer shall execute and
the Owner Trustee or its authenticating agent shall authenticate and deliver, in exchange for or in
lieu of any such mutilated, destroyed, lost or stolen Trust Certificate, a new Trust Certificate in
an authorized denomination and of a like original certificate balance. In connection with the
issuance of any new Trust Certificate under this Section, the Owner Trustee may require the payment
of a sum sufficient to cover any tax or other governmental charge that may be imposed in connection
therewith. Any duplicate Trust Certificate issued pursuant to this Section shall constitute
conclusive evidence of ownership in the Trust, as if originally issued, whether or not the lost,
stolen or destroyed Trust Certificate shall be found at any time.

     Section 3.06. Persons Deemed Owners. Prior to due presentation of a Trust Certificate
for registration of transfer, the Owner Trustee, the Certificate Registrar, any Paying Agent and
any of their respective agents may treat the Person in whose name any Trust Certificate is
registered as the owner of such Trust Certificate for the purpose of receiving distributions
pursuant to Section 5.02 and for all other purposes whatsoever, and none of the Owner Trustee, the
Certificate Registrar, any Paying Agent or any of their respective agents shall be affected by any
notice to the contrary.

     Section 3.07. Access to List of Certificateholders’ Names and Addresses. The
Certificate Registrar shall furnish or cause to be furnished to the Servicer and the Depositor,
within 15 days after receipt by the Certificate Registrar of a written request therefor from the
Servicer or the Depositor, a list, in such form as the Servicer or the Depositor may reasonably
require, of the names and addresses of the Certificateholders as of the most recent Record Date.
If three or more Certificateholders, or one or more Certificateholders evidencing not less than

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51% of the Percentage Interests of the Trust Certificates (hereinafter referred to as the
“Applicants”), apply in writing to the Certificate Registrar, and such application states that the
Applicants desire to communicate with other Certificateholders with respect to their rights under
this Agreement or under the Trust Certificates, then the Certificate Registrar shall, within five
Business Days after the receipt of such application, afford such Applicants access during normal
business hours to the current list of Certificateholders. Each Holder, by receiving and holding a
Trust Certificate, shall be deemed to have agreed not to hold any of the Depositor, the Certificate
Registrar or the Owner Trustee accountable by reason of the disclosure of its name and address,
regardless of the source from which such information was derived.

     Section 3.08. Maintenance of Office or Agency. The Trust shall maintain an office or
offices or agency or agencies where Trust Certificates may be surrendered for registration of
transfer or exchange and where notices and demands to or upon the Owner Trustee or its agent in
respect of the Trust Certificates and the Basic Documents may be served. The Owner Trustee
initially designates 388 Greenwich Street, 14th Floor, New York, New York 10013, as its
office for such purposes. The Owner Trustee shall give prompt written notice to the Depositor and
to the Certificateholders of any change in the location of the Certificate Register or any such
office or agency.

     Section 3.09. Appointment of Paying Agent. The Paying Agent shall make distributions
to Certificateholders from the Certificate Distribution Account pursuant to Sections 5.02 and 5.03
and shall report the amounts of such distributions to the Owner Trustee. Any Paying Agent shall
have the revocable power to withdraw funds from the Certificate Distribution Account for the
purpose of making the distributions referred to above. The Owner Trustee may revoke such power and
remove the Paying Agent if the Owner Trustee determines in its sole discretion that the Paying
Agent shall have failed to perform its obligations under this Agreement in any material respect.
Citibank, N.A. shall act as the initial Paying Agent. Each Paying Agent shall be permitted to
resign as Paying Agent upon 30 days’ written notice to the Owner Trustee. In the event that
Citibank, N.A. shall no longer be the Paying Agent, the Owner Trustee shall appoint a successor to
act as Paying Agent (which shall be a bank or trust company). The Owner Trustee shall cause such
successor Paying Agent or any additional Paying Agent appointed by the Owner Trustee to execute and
deliver to the Owner Trustee an instrument in which such successor Paying Agent or additional
Paying Agent shall agree with the Owner Trustee that, as Paying Agent, such successor Paying Agent
or additional Paying Agent will hold all sums, if any, held by it for payment to the
Certificateholders in trust for the benefit of the Certificateholders entitled thereto until such
sums shall be paid to such Certificateholders. The Paying Agent shall return all unclaimed funds
to the Owner Trustee and upon removal of a Paying Agent such Paying Agent shall also return all
funds in its possession to the Owner Trustee. The provisions of Sections 7.01, 7.03, 7.04, 8.01
and 8.02 shall apply to the Owner Trustee also in its role as Paying Agent, for so long as the
Owner Trustee shall act as Paying Agent and, to the extent applicable, to any other paying agent
appointed hereunder. Any reference in this Agreement to the Paying Agent shall include any
co-paying agent unless the context requires otherwise.

     Section 3.10. Definitive Trust Certificates. The Trust Certificates, upon original
issuance, will be issued in definitive, fully registered form.

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     Section 3.11. Repayment of Trust Certificates. In the event of an optional purchase
pursuant to Section 8.01 (a) of the Sale and Servicing Agreement, the Trust Certificates will be
prepaid in whole, but not in part, at an aggregate prepayment price equal to the aggregate
Certificate Balance of all the Trust Certificates plus accrued interest thereon at the Certificate
Rate.

ARTICLE FOUR

ACTIONS BY OWNER TRUSTEE

     Section 4.01. Prior Notice to Owners with Respect to Certain Matters. Subject to the
provisions and limitations of Section 4.04, with respect to the following matters, the Owner
Trustee shall not take action unless at least 30 days before the taking of such action, the Owner
Trustee shall have notified the Certificateholders in writing of the proposed action and the Owners
shall not have notified the Owner Trustee in writing prior to the 30th day after such notice is
given that such Owners have withheld consent or provided alternative direction:

     (a) the initiation of any claim or lawsuit by the Issuer (except claims or lawsuits brought in
connection with the collection of the Receivables) and the compromise of any action, claim or
lawsuit brought by or against the Issuer (except with respect to the aforementioned claims or
lawsuits for collection of the Receivables);

     (b) the election by the Issuer to file an amendment to the Certificate of Trust (unless such
amendment is required to be filed under the Statutory Trust Statute);

     (c) the amendment of the Indenture by a supplemental indenture in circumstances where the
consent of any Noteholder is required;

     (d) the amendment of the Indenture by a supplemental indenture in circumstances where the
consent of any Noteholder is not required and such amendment materially adversely affects the
interests of the Owners;

     (e) the amendment, change or modification of the Administration Agreement, except to cure any
ambiguity or to amend or supplement any provision in a manner or add any provision that would not
materially adversely affect the interests of the Owners; or

     (f) the appointment pursuant to the Indenture of a successor Note Registrar, paying agent for
the Notes or Indenture Trustee or pursuant to this Agreement of a successor Certificate Registrar,
or the consent to the assignment by the Note Registrar, Paying Agent, Indenture Trustee or
Certificate Registrar of its obligations under the Indenture or this Agreement, as applicable.

     Section 4.02. Action by Owners with Respect to Certain Matters. Subject to the
provisions and limitations of Section 4.04, the Owner Trustee shall not have the power, except upon
the direction of the Owners, to (i) remove the Administrator pursuant to Section 1.09 of the
Administration Agreement, (ii) appoint a successor Administrator pursuant to Section 1.09 of the
Administration Agreement, (iii) remove the Servicer pursuant to Section 7.01 of the Sale and

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Servicing Agreement, (iv) except as expressly provided in the Basic Documents, sell the Receivables
after the termination of the Indenture, or (v) authorize the merger or consolidation of the Issuer
with or into any other statutory trust or entity (other than in accordance with Section 3.10 of the
Indenture). The Owner Trustee shall take the actions referred to in the preceding sentence only
upon written instructions signed by the Owners.

     Section 4.03. Action by Owners with Respect to Bankruptcy. The Owner Trustee shall
not have the power to commence a voluntary proceeding in bankruptcy relating to the Issuer without
the unanimous prior approval of all Owners (including the Depositor) and the delivery to the Owner
Trustee by each such Owner of a certificate certifying that such Owner reasonably believes that the
Issuer is insolvent.

     Section 4.04. Restrictions on Owners’ Power. The Owners shall not direct the Owner
Trustee to take or to refrain from taking any action if such action or inaction would be contrary
to any obligation of the Issuer or the Owner Trustee under this Agreement or any of the other Basic
Documents or would be contrary to the purpose of the Issuer as set forth in Section 2.03, nor shall
the Owner Trustee be obligated to follow any such direction, if given.

     Section 4.05. Majority Control. Except as expressly provided herein, any action that
may be taken by the Owners under this Agreement may be taken by the Holders of Trust Certificates
evidencing not less than a majority of the Percentage Interests evidenced by the Trust
Certificates. Except as expressly provided herein, any written notice of the Owners delivered
pursuant to this Agreement shall be effective if signed by Holders of Trust Certificates evidencing
not less than a majority of the Percentage Interests evidenced by the Trust Certificates at the
time of the delivery of such notice.

ARTICLE FIVE

APPLICATION OF TRUST FUNDS; CERTAIN DUTIES

     Section 5.01. Establishment of Trust Account. The Owner Trustee, for the benefit of
the Certificateholders, shall establish and maintain (or shall cause to be established and
maintained) in the name of the Issuer an Eligible Account (the “Certificate Distribution
Account”), bearing a designation clearly indicating that the funds deposited therein are held
for the benefit of the Certificateholders.

     The Issuer shall possess all right, title and interest in funds on deposit from time to time
in the Certificate Distribution Account and in the proceeds thereof. Except as otherwise expressly
provided herein, the Certificate Distribution Account shall be under the sole dominion and control
of the Owner Trustee for the benefit of the Certificateholders. If, at any time, the Certificate
Distribution Account ceases to be an Eligible Account, the Owner Trustee (or the Depositor on
behalf of the Owner Trustee, if the Certificate Distribution Account is not then held by the Owner
Trustee or an Affiliate thereof) shall within ten Business Days (or such longer period, not to
exceed 30 calendar days, as to which may be satisfactory to each Rating Agency) establish a new
Certificate Distribution Account as an Eligible Account and shall transfer any
cash and/or any investments to such new Certificate Distribution
Account. Monies on deposit in

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the Certificate Distribution Account may be invested in Eligible Investments upon the terms set
forth in Section 4.01 of the Sale and Servicing Agreement, as if the Certificate Distribution
Account were an “Account”. Earnings on investments of funds in the Certificate Distribution
Account shall be paid to the Servicer as part of the Supplemental Servicing Fee and any losses and
investment expenses shall be charged against the funds in such account.

     Section 5.02. Application of Trust Funds.

     (a) On each Payment Date, the Paying Agent will distribute to Certificateholders, on the basis
of the Percentage Interest evidenced by their Trust Certificates, amounts deposited in the
Certificate Distribution Account pursuant to Section 4.06 of the Sale and Servicing Agreement with
respect to such Payment Date.

     (b) On each Payment Date, the Paying Agent shall send to each Certificateholder the statement
or statements provided to the Owner Trustee by the Servicer pursuant to Section 4.10 of the Sale
and Servicing Agreement with respect to such Payment Date.

     (c) In the event that any withholding tax is imposed on the Issuer’s payment (or allocations
of income) to an Owner, such tax shall reduce the amount otherwise distributable to the Owner in
accordance with this Section. The Paying Agent will retain from amounts otherwise distributable to
the Owners sufficient funds for the payment of any tax that is legally owed by the Issuer (but such
authorization shall not prevent the Owner Trustee or the Paying Agent from contesting any such tax
in appropriate proceedings and withholding payment of such tax, if permitted by law, pending the
outcome of such proceedings) upon the written direction of the Depositor. The amount of any
withholding tax imposed with respect to an Owner shall be treated as cash distributed to such Owner
at the time it is withheld by the Issuer and remitted to the appropriate taxing authority. If
there is a possibility that withholding tax is payable with respect to a distribution, the Paying
Agent may in its sole discretion withhold such amounts in accordance with this paragraph (c).

     Section 5.03. Method of Payment. Subject to Section 9.01(c) respecting the final
payment upon retirement of each Trust Certificate, distributions required to be made to
Certificateholders on any Payment Date shall be made to each Certificateholder of record on the
related Record Date by wire transfer, in immediately available funds, to the account of such Holder
at a bank or other entity having appropriate facilities therefor, if such Certificateholder shall
have provided to the Certificate Registrar appropriate written instructions 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.

     Section 5.04. No Segregation of Monies; No Interest. Subject to Sections 5.01 and
5.02, monies received by the Owner Trustee or the Paying Agent hereunder need not be segregated in
any manner except to the extent required by law or the Sale and Servicing Agreement and may be
deposited under such general conditions as may be prescribed by law, and neither the Owner Trustee
nor the Paying Agent shall be liable for any interest thereon.

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     Section 5.05. Accounting and Reports to Owners, Internal Revenue Service and Others.
The Owner Trustee shall maintain (or cause to be maintained) the books of the Issuer on a fiscal
year basis ending March 31 of each year and the accrual method of accounting. In addition, the
Issuer shall deliver to each Owner such information, reports or statements prepared by the
Administrator as may be required by the Code and applicable Treasury Regulations and as may be
required to enable each Owner to prepare its federal and state income tax returns. Consistent with
the Issuer’s characterization for tax purposes, as disregarded as an entity separate from the
Owner, no federal income tax return shall be filed on behalf of the Issuer unless either (i) the
Owner Trustee shall receive an Opinion of Counsel that, based on a change in applicable law
occurring after the date hereof, the Code requires such a filing or (ii) the Internal Revenue
Service shall determine that the Issuer is required to file such a return. Neither the Owner
Trustee nor any Certificateholder will, under any circumstances, and at any time, make an election
on IRS Form 8832 or otherwise, to classify the Trust as an association taxable as a corporation for
federal, state or any other applicable tax purpose. In the event that the Issuer is required to
file tax returns, the Owner Trustee shall, to the extent not undertaken by the Administrator
pursuant to the Administration Agreement, prepare or shall cause to be prepared any tax returns
required to be filed by the Issuer and shall remit such returns to the Depositor (or if the
Depositor no longer owns any Certificates, the Owner designated for such purpose by the Depositor
to the Owner Trustee in writing) at least five days before such returns are due to be filed. The
Depositor (or such designee Owner, as applicable) shall promptly sign such returns and deliver such
returns after signature to the Owner Trustee and such returns shall be filed by the Owner Trustee
with the appropriate tax authorities. In no event shall the Owner Trustee or the Depositor (or
such designee Owner, as applicable) be liable for any liabilities, costs or expenses of the Issuer
or the Noteholders arising out of the application of any tax law, including federal, state, foreign
or local income or excise taxes or any other tax imposed on or measured by income (or any interest,
penalty or addition with respect thereto or arising from a failure to comply therewith) except for
any such liability, cost or expense attributable to any act or omission by the Owner Trustee or the
Depositor (or such designee Owner, as applicable), as the case may be, in breach of its obligations
under this Agreement.

     The Depositor is authorized and directed to execute on behalf of the Issuer, and after
execution to deliver to the Administrator for filing with the Commission, all documents and forms
required to be filed in accordance with applicable law or the rules and regulations prescribed by
the Commission.

ARTICLE SIX

AUTHORITY AND DUTIES OF OWNER TRUSTEE

     Section 6.01. General Authority. Subject to the provisions and limitations of
Sections 2.03 and 2.06, the Owner Trustee is authorized and directed to execute and deliver the
Basic Documents to which the Issuer 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 Issuer is to be a
party and any amendment or other agreement, as evidenced conclusively by the Owner Trustee’s
execution thereof. In addition to the foregoing, the Owner Trustee is authorized, but shall not be
obligated, to take all actions required of the Issuer pursuant to the Basic Documents. The Owner
Trustee is

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further authorized from time to time to take such action as the Administrator recommends with
respect to the Basic Documents.

     Section 6.02. General Duties. Subject to the provisions and limitations of Sections
2.03 and 2.06, it shall be the duty of the Owner Trustee to discharge (or cause to be discharged)
all of its responsibilities pursuant to the terms of this Agreement and the other Basic Documents
to which the Issuer is a party and to administer the Issuer in the interest of the Owners, subject
to the Basic Documents and in accordance with the provisions of this Agreement. Notwithstanding
the foregoing, the Owner Trustee shall be deemed to have discharged its duties and responsibilities
hereunder and under the other Basic Documents to the extent the Administrator has agreed in the
Administration Agreement to perform any act or to discharge any duty of the Owner Trustee hereunder
or under any Basic Document, and the Owner Trustee shall not be held liable for the default or
failure of the Administrator to carry out its obligations under the Administration Agreement.

     Section 6.03. Action Upon Instruction.

     (a) Subject to Article Four, in accordance with the terms of the Basic Documents, the Owners
may by written instruction direct the Owner Trustee in the management of the Issuer. Such
direction may be exercised at any time by written instruction of the Owners pursuant to Article
Four.

     (b) The Owner Trustee shall not be required to take any action hereunder or under any other
Basic Document if the Owner Trustee shall have reasonably determined, or shall have been advised by
counsel, that such action is likely to result in liability on the part of the Owner Trustee or is
contrary to the terms hereof or of any other Basic Document or is otherwise contrary to law.

     (c) Whenever the Owner Trustee is unable to decide between alternative courses of action
permitted or required by the terms of this Agreement or under any other Basic Document, the Owner
Trustee shall promptly give notice (in such form as shall be appropriate under the circumstances)
to the Owners requesting instruction as to the course of action to be adopted, and to the extent
the Owner Trustee acts in good faith in accordance with any written instruction of the Owners
received, the Owner Trustee shall not be liable on account of such action to any Person. If the
Owner Trustee shall not have received appropriate instruction within ten 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 and the other Basic Documents, as it shall
deem to be in the best interests of the Owners, and shall have no liability to any Person for such
action or inaction.

     (d) In the event that the Owner Trustee is unsure as to the application of any provision of
this Agreement or any other Basic Document or any such provision is ambiguous as to its
application, or is, or appears to be, in conflict with any other applicable provision, or in the
event that this Agreement permits any determination by the Owner Trustee or is silent or is
incomplete as to the course of action that the Owner Trustee is required to take with respect to a

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particular set of facts, the Owner Trustee may give notice (in such form as shall be
appropriate under the circumstances) to the Owners requesting instruction and, to the extent that
the Owner Trustee acts or refrains from acting in good faith in accordance with any such
instruction received, the Owner Trustee shall not be liable, on account of such action or inaction,
to any Person. If the Owner Trustee shall not have received appropriate instruction within ten
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 other Basic Documents,
as it shall deem to be in the best interests of the Owners, and shall have no liability to any
Person for such action or inaction.

     Section 6.04. No Duties Except as Specified in this Agreement or in Instructions. The
Owner Trustee shall not have any duty or obligation to manage, make any payment with respect to,
register, record, sell, dispose of, or otherwise deal with the Owner Trust Estate, or to otherwise
take or refrain from taking any action under, or in connection with, any document contemplated
hereby to which the Owner Trustee is a party, except as expressly provided by the terms of this
Agreement or in any document or written instruction received by the Owner Trustee pursuant to
Section 6.03; and no implied duties or obligations shall be read into this Agreement or any other
Basic Document against the Owner Trustee. The Owner Trustee shall have no responsibility for
filing any financing or continuation statement in any public office at any time or to otherwise
perfect or maintain the perfection of any security interest or lien granted to it hereunder or to
prepare or file any Commission filing for the Issuer or to record this Agreement or any other Basic
Document. The Owner Trustee nevertheless agrees that it will, at its own cost and expense,
promptly take all action as may be necessary to discharge any liens (other than the lien of the
Indenture) on any part of the Owner Trust Estate that result from actions by, or claims against,
the Owner Trustee that are not related to the ownership or the administration of the Owner Trust
Estate.

     Section 6.05. No Action Except Under Specified Documents or Instructions. The Owner
Trustee shall not manage, control, use, sell, dispose of or otherwise deal with any part of the
Owner Trust Estate except in accordance with (i) the powers granted to and the authority conferred
upon the Owner Trustee pursuant to this Agreement, (ii) the Basic Documents and (iii) any document
or instruction delivered to the Owner Trustee pursuant to Section 6.03.

     Section 6.06. Restrictions. The Owner Trustee shall not take any action (i) that is
inconsistent with the purposes of the Issuer set forth in Section 2.03 or (ii) that, to the actual
knowledge of the Owner Trustee, would result in the Issuer’s becoming taxable as a corporation for
federal or state income tax purposes. The Owners shall not direct the Owner Trustee to take action
that would violate the provisions of this Agreement.

ARTICLE SEVEN

CONCERNING THE OWNER TRUSTEE AND THE DELAWARE TRUSTEE

     Section 7.01. Acceptance of Trusts and Duties. Each of the Owner Trustee and the
Delaware Trustee accepts the trusts hereby created and each agrees to perform its duties

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hereunder with respect to such trusts, but only upon the terms of this Agreement. Each of the
Owner Trustee and the Delaware Trustee also agrees to disburse all monies actually received by it
constituting part of the Owner Trust Estate upon the terms of this Agreement and the other Basic
Documents. Neither the Owner Trustee nor the Delaware Trustee shall be answerable or accountable
hereunder or under any other Basic Document under any circumstances, except (i) for its own willful
misconduct, bad faith or gross negligence or (ii) in the case of the inaccuracy of any
representation or warranty contained in Section 7.03 expressly made by the Owner Trustee or the
Delaware Trustee. In particular, but not by way of limitation (and subject to the exceptions set
forth in the preceding sentence):

     (a) neither the Owner Trustee nor the Delaware Trustee shall be liable for any error of
judgment made in good faith by the Owner Trustee or the Delaware Trustee;

     (b) neither the Owner Trustee nor the Delaware Trustee shall be liable with respect to any
action taken or omitted to be taken by it in accordance with the instructions of the Administrator
or any Owner or Owners;

     (c) no provision of this Agreement or any other Basic Document shall require the Owner Trustee
or the Delaware 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 other Basic Document if the Owner
Trustee or the Delaware Trustee shall have reasonable grounds for believing that repayment of such
funds or adequate indemnity against such risk or liability is not reasonably assured or provided to
it;

     (d) under no circumstances shall the Owner Trustee or the Delaware Trustee be liable for
indebtedness evidenced by or arising under any Basic Document, including the principal of and
interest on the Notes or the Trust Certificates;

     (e) neither the Owner Trustee nor the Delaware Trustee shall be responsible for or in respect
of the validity or sufficiency of this Agreement or for the due execution hereof by the Depositor
or for the form, character, genuineness, sufficiency, value or validity of any of the Owner Trust
Estate, or for or in respect of the validity or sufficiency of the Basic Documents, other than the
certificate of authentication on the Trust Certificates, and neither the Owner Trustee nor the
Delaware Trustee shall in any event assume or incur any liability, duty or obligation to any
Noteholder or to any Owner, other than as expressly provided for in the Basic Documents;

     (f) neither the Owner Trustee nor the Delaware Trustee shall be liable for the default or
misconduct of the Administrator, the Seller, the Depositor, the Indenture Trustee or the Servicer
under any Basic Document or otherwise, and neither the Owner Trustee nor the Delaware Trustee shall
have any obligation or liability to perform the obligations of the Issuer under this Agreement or
the other Basic Documents that are required to be performed by the Administrator under the
Administration Agreement, the Indenture Trustee under the Indenture or the Servicer or the Seller
under the Sale and Servicing Agreement or any other Person under any of the Basic Documents; and

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     (g) neither the Owner Trustee nor the Delaware Trustee shall be under any 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
other Basic Document, at the request, order or direction of any of the Owners, unless such Owners
have offered to the Owner Trustee and the Delaware Trustee security or indemnity satisfactory to it
against the costs, expenses and liabilities that may be incurred by the Owner Trustee and the
Delaware Trustee therein or thereby; the right of the Owner Trustee and the Delaware Trustee to
perform any discretionary act enumerated in this Agreement or in any other Basic Document shall not
be construed as a duty, and neither the Owner Trustee nor the Delaware Trustee shall be answerable
for other than its gross negligence, bad faith or willful misconduct in the performance of any such
act.

     Section 7.02. Furnishing of Documents.

     The Owner Trustee shall furnish to the Owners, promptly upon receipt of a written request
therefor, duplicates or copies of all reports, notices, requests, demands, certificates, financial
statements and any other instruments furnished to the Owner Trustee under the Basic Documents.

     Section 7.03. Representations and Warranties of the Owner Trustee and the Delaware
Trustee. (1) The Owner Trustee hereby represents and warrants to the Depositor and the Owners,
that:

     (a) it is a national banking association duly organized and validly existing under the laws of
the United States of America; 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; and

     (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 New York governmental rule or regulation governing the
banking or trust powers of the Owner Trustee or any judgment or order binding on it, or constitute
any default under its charter documents or bylaws; and

     (d) this Agreement constitutes a legal, valid and binding obligation of the Owner Trustee,
enforceable against the Owner Trustee in accordance with its terms, except as such enforceability
may be subject to or limited by bankruptcy, insolvency, reorganization, moratorium, liquidation,
fraudulent conveyance or other similar laws affecting the enforcement of creditors’ rights in
general and by general principles of equity, regardless of whether such enforceability shall be
considered in a proceeding in equity or in law; and

     (e) the execution, delivery and performance by the Owner Trustee of this Agreement and the
consummation of the transactions contemplated by this Agreement and the fulfillment of

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the terms hereof do not conflict with, result in any breach of any of the terms and provisions
of, nor constitute (with or without notice or lapse of time) a default under, the charter documents
or bylaws of the Owner Trustee; 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); and

     (f) there are no proceedings or investigations pending or, to the Owner Trustee’s actual
knowledge, threatened, before any court, regulatory body, administrative agency or other
governmental instrumentality having jurisdiction over the Owner Trustee or its properties: (i)
asserting the invalidity of this Agreement or (ii) seeking any determination or ruling that might
materially and adversely affect the performance by the Owner Trustee of its obligations under, or
the validity or enforceability of, this Agreement.

     (2) The Delaware Trustee hereby represents and warrants to the Depositor and the Owners that:

     (a) it is a national banking association duly organized and validly existing under the laws of
the United States of America; 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; and

     (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 Delaware Trustee or any judgment or order binding on it, or
constitute any default under its charter documents or bylaws; and

     (d) this Agreement constitutes a legal, valid and binding obligation of the Delaware Trustee,
enforceable against the Delaware Trustee in accordance with its terms, except as such
enforceability may be subject to or limited by bankruptcy, insolvency, reorganization, moratorium,
liquidation, fraudulent conveyance or other similar laws affecting the enforcement of creditors’
rights in general and by general principles of equity, regardless of whether such enforceability
shall be considered in a proceeding in equity or in law; and

     (e) the execution, delivery and performance by the Delaware Trustee of this Agreement and 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, nor
constitute (with or without notice or lapse of time) a default under, the charter documents or
bylaws of the Delaware Trustee; 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); and

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     (f) there are no proceedings or investigations pending or, to the Delaware Trustee’s actual
knowledge, threatened, before any court, regulatory body, administrative agency or other
governmental instrumentality having jurisdiction over the Delaware Trustee or its properties: (i)
asserting the invalidity of this Agreement or (ii) seeking any determination or ruling that might
materially and adversely affect the performance by the Delaware Trustee of its obligations under,
or the validity or enforceability of, this Agreement.

     Section 7.04. Reliance, Advice of Counsel.

     (a) The Owner Trustee and the Delaware 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 or the Delaware Trustee may accept a
certified copy of a resolution of the board of directors or other governing body of any corporate
party as conclusive evidence that such resolution has been duly adopted by such body and that the
same is in full force and effect. As to any fact or matter the method of determination of which is
not specifically prescribed herein, the Owner Trustee and the Delaware 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 or the Delaware Trustee, for any action taken
or omitted to be taken by it in good faith in reliance thereon.

     (b) In the exercise or administration of the trusts hereunder and in the performance of its
duties and obligations under this Agreement and the other Basic Documents, the Owner Trustee and
the Delaware Trustee (i) may act directly or through its agents or attorneys pursuant to agreements
entered into with any of them, and the Owner Trustee and the Delaware 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 or the Delaware 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 and the Delaware 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 other
Basic Document.

     Section 7.05. Not Acting in Individual Capacity. Except as otherwise provided in this
Article, in accepting the trusts hereby created, each of Citibank, N.A. and Citigroup
Trust-Delaware, National Association, acting solely as Owner Trustee and Delaware Trustee,
respectively, hereunder and not in its individual capacity, and all Persons having any claim
against the Owner Trustee or the Delaware Trustee by reason of the transactions contemplated by
this Agreement or any other Basic Document shall look only to the Owner Trust Estate for payment or
satisfaction thereof.

     Section 7.06. Owner Trustee and Delaware Trustee Not Liable for Trust Certificates or
Receivables. The recitals contained herein and in the Trust Certificates (other than the
signature of the Owner Trustee and the certificate of authentication on the Trust Certificates)
shall be taken as the statements of the Depositor, and the Owner Trustee and the Delaware Trustee
assume no

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responsibility for the correctness thereof. The Owner Trustee and the Delaware Trustee make
no representations as to the validity or sufficiency of this Agreement, any other Basic Document or
the Trust Certificates (other than the signature of the Owner Trustee and the certificate of
authentication on the Trust Certificates and the representations and warranties in Section 7.03) or
the Notes, or of any Receivable or related documents. The Owner Trustee and the Delaware Trustee
shall at no time have any responsibility or liability for or with respect to the legality, validity
and enforceability of any Receivable, or the perfection and priority of any security interest
created by any Receivable in any Financed Vehicle or the maintenance of any such perfection and
priority, or for or with respect to the sufficiency of the Owner Trust Estate or its ability to
generate the payments to be distributed to Certificateholders under this Agreement or the
Noteholders under the Indenture, including, without limitation, the existence, condition and
ownership of any Financed Vehicle; the existence and enforceability of any insurance thereon; the
existence and contents of any Receivable on any computer or other record thereof; the validity of
the assignment of any Receivable to the Issuer or of any intervening assignment; the completeness
of any Receivable; the performance or enforcement of any Receivable; the compliance by the
Depositor or the Servicer with any warranty or representation made under any Basic Document or in
any related document or the accuracy of any such warranty or representation, or any action of the
Administrator, the Indenture Trustee or the Servicer or any subservicer taken in the name of the
Owner Trustee.

     Section 7.07. Owner Trustee or Delaware Trustee May Own Trust Certificates and Notes.
Each of the Owner Trustee and the Delaware Trustee in its individual or any other capacity may
become the owner or pledgee of Trust Certificates or Notes and may deal with the Depositor, the
Administrator, the Indenture Trustee and the Servicer in banking transactions with the same rights
as it would have if it were not Owner Trustee or the Delaware Trustee, respectively.

     Section 7.08. Duties of the Delaware Trustee. The Delaware Trustee is appointed to
serve as the trustee of the Trust in the State of Delaware for the sole purpose of satisfying the
requirement of Section 3807(a) of the Delaware Act that the Trust have at least one trustee with a
principal place of business in Delaware. It is understood and agreed by the parties hereto that
the Delaware Trustee shall have none of the duties or liabilities of the Owner Trustee. The duties
of the Delaware Trustee shall be limited to (a) accepting legal process served on the Trust in the
State of Delaware and (b) the execution of any certificates required to be filed with the Secretary
of State of the State of Delaware which the Delaware Trustee is required to execute under Section
3811 of the Delaware Act. To the extent that, at law or in equity, the Delaware Trustee has duties
(including fiduciary duties) and liabilities relating thereto to the Trust, the beneficial owners
thereof or any other person, it is hereby understood and agreed by the other parties hereto that
such duties and liabilities are replaced by the duties and liabilities of the Delaware Trustee
expressly set forth in this Section 7.08. The Delaware Trustee shall have all the rights,
privileges and immunities of the Owner Trustee.

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ARTICLE EIGHT

COMPENSATION OF OWNER TRUSTEE AND THE DELAWARE TRUSTEE

     Section 8.01. Owner Trustee’s and Delaware Trustee’s Fees and Expenses. Each of the
Owner Trustee and the Delaware Trustee shall receive as compensation for its services hereunder
such fees as have been separately agreed upon before the date hereof between the Depositor and the
Owner Trustee and the Delaware Trustee, respectively, and upon the formation of the Issuer, each of
the Owner Trustee and the Delaware Trustee shall be entitled to be reimbursed by the Issuer for its
other reasonable expenses hereunder, including the reasonable compensation, expenses and
disbursements of such agents, representatives, experts and counsel as each of the Owner Trustee and
the Delaware Trustee may employ in connection with the exercise and performance of its rights and
its duties hereunder.

     Section 8.02. Indemnification. The Issuer shall, or shall cause the Administrator to,
indemnify each Indemnified Party and its respective officers, directors, employees and agents
against any and all loss, liability or expense (including reasonable attorney’s fees and expenses)
incurred by it in connection with the administration of the Issuer and the performance of its
duties hereunder not resulting from its own willful misconduct, gross negligence or bad faith. The
Indemnified Party shall notify the Issuer and the Administrator promptly of any claim for which it
may seek indemnity. The indemnities contained in this Section shall survive the resignation or
termination of the Owner Trustee, the Delaware Trustee or the termination of this Agreement. In
the event of any claim, action or proceeding for which indemnity will be sought pursuant to this
Section, the Owner Trustee’s or the Delaware Trustee’s choice of legal counsel shall be subject to
the approval of the Depositor (or if the Depositor is no longer an owner, the designee of the
Depositor), which approval shall not be unreasonably withheld. Neither the Issuer nor the
Administrator need reimburse any expense or indemnify against any loss, liability or expense
incurred by any Indemnified Party (1) through such party’s own willful misconduct, gross negligence
or bad faith or (2) in the case of the inaccuracy of any representation or warranty contained in
Sections 7.03 expressly made by the Owner Trustee or the Delaware Trustee.

     Section 8.03. Payments to the Owner Trustee and to the Delaware Trustee. Any amounts
paid to the Owner Trustee and to the Delaware Trustee pursuant to this Article shall be deemed not
to be a part of the Owner Trust Estate immediately after such payment. Any amounts owing to the
Owner Trustee under this Agreement or the other Basic Documents shall constitute a claim against
the Owner Trust Estate.

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ARTICLE NINE

TERMINATION OF TRUST AGREEMENT

     Section 9.01. Termination of Trust Agreement.

     (a) The Issuer shall dissolve immediately prior to the earlier to occur of (i) the purchase on
any Payment Date by the Servicer, or any successor Servicer, at its option, pursuant to Section
8.01(a) of the Sale and Servicing Agreement, of the Owner Trust Estate other than the Accounts and
the Certificate Distribution Account, (ii) the final distribution by the Owner Trustee of all
monies or other property or proceeds of the Owner Trust Estate in accordance with the terms of the
Indenture, the Sale and Servicing Agreement, and Article Five, or (iii) the Payment Date next
succeeding the month which is one year after the maturity or other liquidation of the last
Receivable and the disposition of any amount received upon liquidation of any property remaining in
the Owner Trust Estate. The bankruptcy, liquidation, dissolution, death or incapacity of any Owner
shall not (i) operate to terminate this Agreement or the Issuer, (ii) entitle such Owner’s legal
representatives or heirs to claim an accounting or to take any action or proceeding in any court
for a partition or winding up of all or any part of the Issuer or Owner Trust Estate or (iii)
otherwise affect the rights, obligations and liabilities of the parties hereto. The Issuer shall
be entitled to deduct from the final distribution to Certificateholders any amounts required to pay
any other claims against and obligations of the Issuer in accordance with Section 3808(e) of the
Statutory Trust Statute.

     (b) Except as provided in Section 9.01(a), neither of the Depositor nor any Owner shall be
entitled to revoke or terminate the Issuer.

     (c) The outstanding Trust Certificates are subject to redemption in whole, but not in part,
pursuant to Section 8.01 of the Sale and Servicing Agreement; provided that the Issuer has
available funds sufficient to pay the aggregate Certificate Balance of all the Trust Certificates,
together with accrued interest at the Certificate Rate to but excluding the Payment Date. Notice
of any termination of the Issuer, specifying the Payment Date upon which Certificateholders shall
surrender their Trust Certificates to the Paying Agent for payment of the final distribution and
cancellation, shall be given by the Owner Trustee by letter to Certificateholders mailed within
five Business Days of receipt of notice of such termination from the Servicer given pursuant to
Section 8.01(b) of the Sale and Servicing Agreement, stating (i) the Payment Date upon or with
respect to which final payment of the Trust Certificates shall be made upon presentation and
surrender of the Trust Certificates at the office of the Paying Agent therein designated, (ii) the
amount of any such final payment and (iii) that the Record Date otherwise applicable to such
Payment Date is not applicable, payments being made only upon presentation and surrender of the
Trust Certificates at the office of the Paying Agent therein specified. The Owner Trustee shall
give such notice to the Certificate Registrar (if other than the Owner Trustee) and the Paying
Agent (if other than the Owner Trustee) at the time such notice is given to Certificateholders.
Upon presentation and surrender of the Trust Certificates, the Paying Agent shall cause to be
distributed to Certificateholders amounts distributable on such Payment Date pursuant to Section
5.02. The Owner Trustee shall promptly notify each Rating Agency upon the final payment of the
Trust Certificates.

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     (d) In the event that all of the Certificateholders shall not surrender their Trust
Certificates for cancellation within six months after the date specified in the above mentioned
written notice, the Owner Trustee shall give a second written notice to the remaining
Certificateholders to surrender their Trust Certificates for cancellation and receive the final
distribution with respect thereto. If within one year after the second notice all the Trust
Certificates shall not have been surrendered for cancellation, the Owner Trustee may take
appropriate steps, or may appoint an agent to take appropriate steps, to contact the remaining
Certificateholders concerning surrender of their Trust Certificates, and the cost thereof shall be
paid out of the funds and other assets that shall remain subject to this Agreement. Subject to
applicable escheat laws, any funds remaining in the Issuer after exhaustion of such remedies shall
be distributed by the Owner Trustee to the Depositor, in its capacities as Depositor and as Holder
of such Certificate.

     (e) Upon the winding up of the Issuer and its termination, the Owner Trustee shall, upon the
direction and at the expense of the Depositor, cause the Certificate of Trust to be cancelled by
filing a certificate of cancellation with the Secretary of State in accordance with Section 3810 of
the Statutory Trust Statute. Upon the filing of the certificate of cancellation, the Issuer and
this Agreement (other than Article 8) shall terminate and be of no further force or effect.

ARTICLE TEN

SUCCESSOR AND ADDITIONAL OWNER TRUSTEES

     Section 10.01. Eligibility Requirements for Owner Trustee and Delaware Trustee. The
Owner Trustee shall at all times (i) maintain its principal place of business in the State of New
York or such other location within the United States to which the Depositor shall consent in
writing, (ii) be authorized to exercise corporate trust powers, (iii) have a combined capital and
surplus of at least $50,000,000, (iv) be subject to supervision or examination by federal or state
authorities and (v) have the Required Rating. If such person 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 person
shall be deemed to be its combined capital and surplus as set forth in its most recent report of
condition so published. The Delaware Trustee shall at all times be a person satisfying the
provisions of Section 3807(a) of the Statutory Trust Statute. In case at any time the Owner
Trustee or the Delaware Trustee, as applicable, shall cease to be eligible in accordance with the
provisions of this Section, the Owner Trustee or the Delaware Trustee, as applicable, shall resign
immediately in the manner and with the effect specified in Section 10.02.

     Section 10.02. Resignation or Removal of Owner Trustee or Delaware Trustee. The Owner
Trustee or Delaware Trustee may at any time resign and be discharged from the trusts hereby created
by giving written notice thereof to the Administrator. Upon receiving such notice of resignation,
the Administrator shall promptly appoint a successor Owner Trustee or Delaware Trustee, as
applicable, by written instrument, in duplicate, one copy of which instrument shall be delivered to
the resigning Owner Trustee or Delaware Trustee, as applicable, and one copy to the successor Owner
Trustee or Delaware Trustee, as applicable. If no successor Owner Trustee or

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Delaware Trustee, as applicable, shall have been so appointed and have accepted appointment
within 30 days after the giving of such notice of resignation, the resigning Owner Trustee or
Delaware Trustee, as applicable, may petition at the Issuer’s expense any court of competent
jurisdiction for the appointment of a successor Owner Trustee or Delaware Trustee, as applicable.

     If at any time the Owner Trustee or Delaware Trustee, as applicable, shall cease to be
eligible in accordance with Section 10.01 and shall fail to resign after written request therefor
by the Administrator, or if at any time the Owner Trustee or Delaware Trustee, as applicable, shall
be legally unable to act, or shall be adjudged bankrupt or insolvent, or a receiver of the Owner
Trustee or Delaware Trustee, as applicable, of either of their property shall be appointed, or any
public officer shall take charge or control of the Owner Trustee or Delaware Trustee or of either
of their property or affairs for the purpose of rehabilitation, conservation or liquidation, then
the Administrator may remove the Owner Trustee or Delaware Trustee, as applicable. If the
Administrator shall remove the Owner Trustee or Delaware Trustee, as applicable, under the
authority of the immediately preceding sentence, the Administrator shall promptly appoint a
successor Owner Trustee or Delaware Trustee, as applicable, by written instrument, in duplicate,
one copy of which instrument shall be delivered to the outgoing Owner Trustee or Delaware Trustee,
as applicable, so removed and one copy to the successor Owner Trustee or Delaware Trustee, as
applicable, and shall pay all fees and expenses owed to the outgoing Owner Trustee or Delaware
Trustee, as applicable.

     Any resignation or removal of the Owner Trustee or Delaware Trustee, as applicable, and
appointment of a successor Owner Trustee or Delaware Trustee, as applicable, pursuant to any of the
provisions of this Section shall not become effective until acceptance of appointment by the
successor Owner Trustee or Delaware Trustee, as applicable, pursuant to Section 10.03 and payment
of all fees and expenses owed to the outgoing Owner Trustee or Delaware Trustee, as applicable.
The Administrator shall provide notice of such resignation or removal of the Owner Trustee or
Delaware Trustee, as applicable, to each Rating Agency.

     Section 10.03. Successor Owner Trustee or Delaware Trustee. Any successor Owner
Trustee or Delaware Trustee, as applicable, appointed pursuant to Section 10.02 shall execute,
acknowledge and deliver to the Administrator and to its predecessor Owner Trustee or Delaware
Trustee, as applicable, an instrument accepting such appointment under this Agreement, and
thereupon the resignation or removal of the predecessor Owner Trustee or Delaware Trustee, as
applicable, shall become effective, and such successor Owner Trustee or Delaware Trustee, as
applicable, 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 or Delaware Trustee, as applicable. The predecessor Owner
Trustee or Delaware Trustee, as applicable, shall upon payment of its fees and expenses deliver to
the successor Owner Trustee or Delaware Trustee, as applicable, all documents and statements and
monies held by it under this Agreement and the Administrator and the predecessor Owner Trustee or
Delaware Trustee, as applicable, 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 or Delaware Trustee, as applicable, all such rights, powers, duties and
obligations.

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     No successor Owner Trustee or Delaware Trustee, as applicable, shall accept appointment as
provided in this Section unless at the time of such acceptance such successor Owner Trustee or
Delaware Trustee, as applicable, shall be eligible pursuant to Section 10.01.

     Upon acceptance of appointment by a successor Owner Trustee or Delaware Trustee, as
applicable, pursuant to this Section, the Administrator shall mail notice thereof to all
Certificateholders, the Indenture Trustee, the Noteholders and each Rating Agency. If the
Administrator shall fail to mail such notice within ten days after acceptance of such appointment
by the successor Owner Trustee or Delaware Trustee, as applicable, the successor Owner Trustee or
Delaware Trustee, as applicable, shall cause such notice to be mailed at the expense of the
Administrator.

     Section 10.04. Merger or Consolidation of Owner Trustee or Delaware Trustee. Any
Person into which the Owner Trustee or Delaware Trustee, as applicable, may be merged or converted
or with which it may be consolidated, or any Person resulting from any merger, conversion or
consolidation to which the Owner Trustee or Delaware Trustee, as applicable, shall be a party, or
any Person succeeding to all or substantially all of the corporate trust business of the Owner
Trustee or Delaware Trustee, as applicable, shall be the successor of the Owner Trustee or Delaware
Trustee, as applicable, hereunder, without the execution or filing of any instrument or any further
act on the part of any of the parties hereto, anything herein to the contrary notwithstanding;
provided, that such Person shall be eligible pursuant to Section 10.01 and, provided, further, that
the Owner Trustee or Delaware Trustee, as applicable, shall mail notice of such merger or
consolidation to each Rating Agency.

     Section 10.05. Appointment of Co-Trustee or Separate Trustee. Notwithstanding any
other provisions of this Agreement, at any time, for the purpose of meeting any legal requirements
of any jurisdiction in which any part of the Owner Trust Estate or any Financed Vehicle may at the
time be located, the Administrator and the Owner Trustee acting jointly shall have the power and
shall execute and deliver all instruments to appoint one or more Persons approved by the
Administrator and Owner Trustee to act as co-trustee, jointly with the Owner Trustee, or as
separate trustee or separate trustees, of all or any part of the Owner Trust Estate, and to vest in
such Person, in such capacity, such title to the Trust or any part thereof and, subject to the
other provisions of this Section, such powers, duties, obligations, rights and trusts as the
Administrator and the Owner Trustee may consider necessary or desirable. If the Administrator
shall not have joined in such appointment within 15 days after the receipt by it of a request to do
so, the Owner Trustee alone shall have the power to make such appointment. The Owner Trustee
agrees that upon receipt of a written request from the Administrator to appoint a co-trustee, it
will, at the expense of the Issuer, either (i) promptly provide evidence reasonably satisfactory to
the Administrator that such co-trustee is not required or (ii) cooperate fully to ensure a
co-trustee is appointed with any required timeframe. No co-trustee or separate trustee under this
Agreement shall be required to meet the terms of eligibility as a successor Owner Trustee pursuant
to Section 10.01, except that such co-trustee or successor trustee shall have the Required Rating,
and no notice of the appointment of any co-trustee or separate trustee shall be required pursuant
to Section 10.03.

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     Each separate trustee and co-trustee shall, to the extent permitted by law, be appointed and
act subject to the following provisions and conditions:

     (a) all rights, powers, duties and obligations conferred or imposed upon the Owner Trustee
shall be conferred upon and exercised or performed by the Owner Trustee and such separate trustee
or co-trustee jointly (it being understood that such separate trustee or co-trustee is not
authorized to act separately without the Owner Trustee joining in such act), except to the extent
that under any law of any jurisdiction in which any particular act or acts are to be performed, the
Owner Trustee shall be incompetent or unqualified to perform such act or acts, in which event such
rights, powers, duties and obligations (including the holding of title to the Owner Trust Estate or
any portion thereof in any such jurisdiction) shall be exercised and performed singly by such
separate trustee or co-trustee, but solely at the direction of the Owner Trustee;

     (b) no trustee under this Agreement shall be personally liable by reason of any act or
omission of any other trustee under this Agreement; and

     (c) the Administrator and the Owner Trustee acting jointly may at any time accept the
resignation of or remove any separate trustee or co-trustee.

     Any notice, request or other writing given to the Owner Trustee shall be deemed to have been
given to each of the then separate trustees and co-trustees, as effectively as if given to each of
them. Every instrument appointing any separate trustee or co-trustee shall refer to this Agreement
and the conditions of this Article. Each separate trustee and co-trustee, upon its acceptance of
the trusts conferred, shall be vested with the estates or property specified in its instrument of
appointment, either jointly with the Owner Trustee or separately, as may be provided therein,
subject to all the provisions of this Agreement, specifically including every provision of this
Agreement relating to the conduct of, affecting the liability of, or affording protection to, the
Owner Trustee. Each such instrument shall be filed with the Owner Trustee and a copy thereof given
to the Administrator.

     Any separate trustee or co-trustee may at any time appoint the Owner Trustee as its agent or
attorney-in-fact with full power and authority, to the extent not prohibited by law, to do any
lawful act under or in respect of this Agreement on its behalf and in its name. If any separate
trustee or co-trustee shall die, become incapable of acting, resign or be removed, all of its
estates, properties, rights, remedies and trusts shall vest in and be exercised by the Owner
Trustee, to the extent permitted by law, without the appointment of a new or successor co-trustee
or separate trustee.

30

 

ARTICLE ELEVEN

MISCELLANEOUS

     Section 11.01. Supplements and Amendments.

     (a) This Agreement may be amended by the parties hereto with prior written notice to each
Rating Agency, without the consent of any Securityholders, to cure any ambiguity, to correct or
supplement any provisions in this Agreement or for the purpose of adding any provisions to or
changing in any manner or eliminating any of the provisions in this Agreement or of modifying in
any manner the rights of the Noteholders or the Certificateholders; provided, however, that such
action shall not, as evidenced by an Opinion of Counsel, adversely affect in any material respect
the interests of any Noteholder or Certificateholder.

     (b) This Agreement may also be amended from time to time by the parties hereto, with prior
written notice to each Rating Agency, with the consent of the Holders of Trust Certificates
evidencing not less than a majority of the Percentage Interests evidenced by the Trust Certificates
and, if such amendment materially and adversely affects the interests of the Noteholders, with the
consent of Holders (as such term is defined in the Indenture) of Notes evidencing not less than a
majority of the Outstanding Amount of the Notes, for the purpose of adding any provisions to or
changing in any manner or eliminating any of the provisions of this Agreement or of modifying in
any manner the rights of the Noteholders or the Certificateholders; provided, however, that no such
amendment shall (i) increase or reduce in any manner the amount of, or accelerate or delay the
timing of, collections of payments on Receivables or distributions that shall be required to be
made for the benefit of the Noteholders or the Certificateholders, (ii) increase or reduce any
Interest Rate or Certificate Rate or (iii) reduce the aforesaid percentage of the Outstanding
Amount of the Notes or of the Percentage Interests evidenced by the Trust Certificates required to
consent to any such amendment, without the consent of the Holders of all the outstanding Notes and
Trust Certificates affected thereby.

     (c) Prior to the execution of any such amendment or consent, the Owner Trustee shall furnish
written notification of the substance of such amendment or consent to the Indenture Trustee, the
Administrator and each Rating Agency.

     (d) 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. It shall not be necessary for the consent of Certificateholders, Noteholders or
the Indenture Trustee pursuant to this Section to approve the particular form of any proposed
amendment or consent, but it shall be sufficient if such consent shall approve the substance
thereof. The manner of obtaining such consents (and any other consents of Certificateholders
provided for in this Agreement or in any other Basic Document) and of evidencing the authorization
of the execution thereof by Certificateholders shall be subject to such reasonable requirements as
the Owner Trustee may prescribe.

     (e) 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.

31

 

     (f) In connection with the execution of any amendment to this Agreement or any other basic
Document to which the Issuer is a party and for which amendment the Owner Trustee’s or the Delaware
Trustee’s consent is sought, the Owner Trustee and the Delaware Trustee shall be entitled to
receive and rely upon an Opinion of Counsel to the effect that the execution of such amendment is
authorized or permitted by this Agreement or such other Basic Document, as the case may be, and
that all conditions precedent in this Agreement or such other Basic Document, as the case may be,
for the execution and delivery thereof by the Issuer or the Owner Trustee, as the case may be, have
been satisfied. The Owner Trustee or Delaware Trustee may, but shall not be obligated to, enter
into any such amendment that affects the Owner Trustee’s or Delaware Trustee’s own rights, duties
or immunities under this Agreement or otherwise.

     Section 11.02. No Legal Title to Owner Trust Estate in Owner. The Owner shall not
have legal title to any part of the Owner Trust Estate. The Owners shall be entitled to receive
distributions with respect to their undivided ownership interest therein only in accordance with
Articles Five and Nine. No transfer, by operation of law or otherwise, of any right, title or
interest of the Owners to and in their ownership interest in the Owner Trust Estate shall operate
to terminate this Agreement or the trusts hereunder or entitle any transferee to an accounting or
to the transfer to it of legal title to any part of the Owner Trust Estate.

     Section 11.03. Limitations on Rights of Others. The provisions of this Agreement are
solely for the benefit of the Owner Trustee, the Delaware Trustee, the Indemnified Parties, the
Depositor, the Owners, the Administrator and, to the extent expressly provided herein, the
Indenture Trustee and the Noteholders, and nothing in this Agreement, whether express or implied,
shall be construed to give to any other Person any legal or equitable right, remedy or claim in the
Owner Trust Estate or under or in respect of this Agreement or any covenants, conditions or
provisions contained herein.

     Section 11.04. Notices.

     (a) Unless otherwise expressly specified or permitted by the terms hereof, all demands,
notices and communications under this Agreement shall be in writing, personally delivered, mailed
by electronic mail (if an address therefore has been provided by the respective party in writing),
mailed by certified mail, return receipt requested, delivered by overnight delivery service, or
sent via facsimile transmission (followed by hard copy by overnight delivery) and shall be deemed
to have been duly given upon receipt (i) in the case of the Owner Trustee, Citibank, N.A., 388
Greenwich Street, 14th Floor, New York, New York 10013, Attention: Structured Finance
Agency & Trust: Honda Auto Receivables 2009-2, (ii) in the case of the Delaware Trustee, to
Citigroup Trust-Delaware, National Association, 222 Delaware Avenue, 14th Floor,
Wilmington, Delaware 19801, Attention: William M. Hearn, (iii) in the case of the Depositor, to
American Honda Receivables Corp., 20800 Madrona Avenue, Torrance, California 90503, Attention:
President or (iv) as to any party, at such other address as shall be designated by such party in a
written notice to the other party.

     (b) Any notice required or permitted to be given to a Certificateholder shall be given by
overnight delivery or first-class mail, postage prepaid, at the address of such Holder as shown

32

 

in the Certificate Register. Any notice so mailed within the time prescribed in this
Agreement shall be conclusively presumed to have been duly given, whether or not the
Certificateholder receives such notice.

     Section 11.05. Severability. If any one or more of the covenants, agreements,
provisions or terms of this Agreement shall be for any reason whatsoever held invalid, then such
covenants, agreements, provisions or terms shall be deemed severable from the remaining covenants,
agreements, provisions or terms of this Agreement and shall in no way affect the validity or
enforceability of the other covenants, agreements, provisions or terms of this Agreement or of the
Trust Certificates or the rights of the Holders thereof.

     Section 11.06. Separate Counterparts. This Agreement may be executed by the parties
hereto in separate counterparts, each of which when so executed and delivered shall be an original,
but all such counterparts shall together constitute but one and the same instrument.

     Section 11.07. Successors and Assigns. All covenants and agreements contained herein
shall be binding upon, and inure to the benefit of, each of the Depositor and its permitted
assigns, the Owner Trustee and its successors, the Delaware Trustee and its successors and each
Owner and its successors and permitted assigns, all as herein provided. Any request, notice,
direction, consent, waiver or other instrument or action by an Owner shall bind the successors and
assigns of such Owner.

     Section 11.08. No Petition. The Owner Trustee and the Delaware Trustee, by entering
into this Agreement, each Certificateholder, by accepting a Trust Certificate, and the Indenture
Trustee and each Noteholder, by accepting the benefits of this Agreement, each hereby covenants and
agrees that it will not at any time institute against the Depositor or the Issuer, or join in any
institution against the Depositor or the Issuer of, any bankruptcy proceedings under any United
States federal or state bankruptcy or similar law in connection with any obligations relating to
the Trust Certificates, the Notes, this Agreement or any other Basic Document.

     Section 11.09. No Recourse. Each Certificateholder by accepting a Trust Certificate
acknowledges that such Certificateholder’s Trust Certificates represent beneficial interests in the
Issuer only and do not represent interests in or obligations of the Depositor, the Seller, the
Servicer, the Administrator, the Owner Trustee, the Delaware Trustee, the Indenture Trustee or any
of their respective Affiliates and no recourse may be had against such parties or their assets,
except as may be expressly set forth or contemplated in the Trust Certificates, this Agreement or
any other Basic Document.

     Section 11.10. Headings. The headings of the various Articles and Sections herein are
for convenience of reference only and shall not define or limit any of the terms or provisions
hereof.

     Section 11.11. Governing Law; Submission to Jurisdiction. THIS AGREEMENT SHALL BE
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF DELAWARE, WITHOUT REFERENCE TO ITS CONFLICT
OF LAW PROVISIONS,

33

 

AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN
ACCORDANCE WITH SUCH LAWS.

     Each of the parties hereto hereby submits to the jurisdiction of the United States District
Court for the Southern District of New York and of any New York State court sitting in New York
City for purposes of all legal proceedings arising out of or relating to this Agreement or the
transactions contemplated hereby. Each of the parties hereto hereby further irrevocably waives any
claim that any such courts lack jurisdiction over such party, and agrees not to plead or claim, in
any legal action or proceeding with respect to this Agreement in any of the aforesaid courts, that
any such court lacks jurisdiction over such party. Each of the parties hereto irrevocably waives,
to the fullest extent permitted by law, any objection that it may now or hereafter have to the
laying of the venue of any such proceeding brought in such a court and any claim that any such
proceeding brought in such a court has been brought in an inconvenient forum.

     Section 11.12. Trust Certificates Nonassessable and Fully Paid. Certificateholders
shall not be personally liable for obligations of the Issuer. The interests represented by the
Trust Certificates shall be nonassessable for any losses or expenses of the Issuer or for any
reason whatsoever, and, upon the authentication thereof by the Owner Trustee pursuant to Section
3.03, 3.04 or 3.05, the Trust Certificates are and shall be deemed fully paid.

     Section 11.13. Depositor Payment Obligation. The Depositor shall be responsible for
payment of the Administrator’s compensation under the Administration Agreement and shall reimburse
the Administrator for all expenses and liabilities of the Administrator incurred thereunder. In
addition, the Depositor shall be responsible for the payment of all fees and expenses of the Issuer
and the Trustees paid by any of them in connection with any of their obligations under the Basic
Documents to obtain or maintain any required license under the Pennsylvania Motor Vehicle Sales
Finance Act and the Maryland Act (MD Fin. Inst. Code Ann., Title 11, Subtitle 4).

     Section 11.14. Tax Treatment. Notwithstanding the foregoing or anything herein to the
contrary, all persons (and their respective employees, representatives or other agents) may
disclose to any and all persons, without limitation of any kind, the tax treatment and tax
structure of the transaction described herein and all materials of any kind (including opinions or
other tax analyses) that are provided to the recipient relating to such tax treatment and tax
structure.

     Section 11.15. Depositor’s TALF Related Signing Authority. In connection with the
Federal Reserve Bank of New York’s Term Asset-Backed Securities Loan Facility (“TALF”), the
Depositor, as the initial holder of the Certificates, shall be authorized to execute and deliver on
behalf of the Trust and cause the Trust to perform (i) any Term Asset-Backed Securities Loan
Facility Undertaking, (ii) any Certification as to TALF Eligibility, (iii) any Indemnity
Undertaking and (iv) any other documents, certificates, agreements and instruments contemplated
thereby or related thereto or otherwise necessary or incidental to qualifying under TALF. Any
action taken on behalf of the Trust by the Depositor prior to the date hereof with respect to TALF,
including execution of any Indemnity Undertaking and Certificate as to TALF Eligibility, is hereby
ratified.

34

 

     IN WITNESS WHEREOF, the parties hereto have caused this Amended and Restated Trust Agreement
to be duly executed by their respective officers as of the day and year first above written.

	 	 	 	 	 
	 	AMERICAN HONDA RECEIVABLES CORP.,

   as Depositor

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 
	 	CITIBANK, N.A.,

   as Owner Trustee

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 
	 	CITIGROUP TRUST-DELAWARE, NATIONAL ASSOCIATION,

   as Delaware Trustee

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 

35

 

EXHIBIT A

FORM OF TRUST CERTIFICATE

     THIS CERTIFICATE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
“SECURITIES ACT”), OR ANY STATE SECURITIES LAWS, AND MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE
TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN EXEMPTION THEREFROM. IN ADDITION, THE
TRANSFER OF THIS CERTIFICATE IS SUBJECT TO CERTAIN RESTRICTIONS AND CONDITIONS SET FORTH IN SECTION
3.04 OF THE TRUST AGREEMENT UNDER WHICH THIS CERTIFICATE ISSUED (A COPY OF WHICH TRUST AGREEMENT IS
AVAILABLE FROM THE OWNER TRUSTEE UPON REQUEST), INCLUDING RECEIPT BY THE OWNER TRUSTEE OF AN
INVESTMENT LETTER IN WHICH THE TRANSFEREE MAKES CERTAIN REPRESENTATIONS.

NUMBER: R-1      Initial Certificate Balance: $66,582,876.59

HONDA AUTO RECEIVABLES 2009-2 OWNER TRUST

0.00% ASSET BACKED CERTIFICATE

evidencing a fractional undivided interest in the Issuer, as defined below, the property of which
includes a pool of retail installment sale or conditional sale contracts secured by new and used
Honda and Acura motor vehicles.

     (This Trust Certificate does not represent an interest in or obligation of American Honda
Receivables Corp., American Honda Finance Corporation or any of their respective affiliates.)

     THIS CERTIFIES THAT American Honda Receivables Corp. is the registered owner of a 100 percent
nonassessable, fully-paid, undivided interest in the Honda Auto Receivables 2009-2 Owner Trust (the
“Issuer”), formed by American Honda Receivables Corp., a California corporation (the “Depositor”).

     The Issuer was created pursuant to a Trust Agreement dated as of April 23, 2009, as amended
and restated by an Amended and Restated Trust Agreement dated May 12, 2009 (as amended or
supplemented from time to time, the “Trust Agreement”), between the Depositor and Citibank, N.A.,
as owner trustee (the “Owner Trustee”) and Citigroup Trust-Delaware, National Association, as
Delaware trustee (the “Delaware Trustee”); a summary of certain of the pertinent provisions of
which is set forth below. Capitalized terms used herein that are not otherwise defined shall have
the meanings ascribed thereto in the Trust Agreement.

     This Trust Certificate is one of the duly authorized certificates designated as “Asset Backed
Certificates” (the “Trust Certificates”). Issued under an Indenture dated as of May 1, 2009 (the
“Indenture”), between the Issuer and Deutsche Bank Trust Company Americas, as indenture trustee,
are four classes of Notes designated as “Class A-1 1.31785% Asset Backed

A-1

 

Notes,” “Class A-2 2.22% Asset Backed Notes”, “Class A-3 2.79% Asset Backed Notes” and “Class
A-4 4.43% Asset Backed Notes” (collectively, the “Notes”). This Trust Certificate is issued under
and is subject to terms, provisions and conditions of the Trust Agreement, to which Trust Agreement
the Holder of this Trust Certificate, by virtue of its acceptance thereof, assents and by which
such Holder is bound. The property of the Issuer includes, among other things, a pool of retail
installment sale or conditional sale contracts for new and used Honda and Acura motor vehicles
(collectively, the “Receivables”), all monies received on or in respect of the Receivables on or
after May 1, 2009, security interests in the vehicles financed thereby, certain bank accounts and
the proceeds thereof, proceeds from claims on certain insurance policies and certain other rights
under the Trust Agreement and the Sale and Servicing Agreement and all proceeds of the foregoing.

     It is the intent of the Depositor, the Servicer and the Certificateholder that, solely for
purposes of federal income, state and local income tax and any other income taxes, the Issuer will
be treated as a disregarded entity not separate from the sole Certificateholder. The purchaser
hereof, by acceptance of the Trust Certificates, agrees to treat, and to take no action
inconsistent with the above treatment for so long as it is the sole Owner.

     Solely in the event the Trust Certificates are held by more than a single Owner, it is the
intent of the Depositor, the Servicer and the Certificateholders that, solely for purposes of
federal income, state and local income and single business tax and any other income taxes, the
Issuer will be treated as a partnership and the Certificateholders will be treated as partners in
the partnership. The purchaser hereof and the other Certificateholders, by acceptance of a Trust
Certificate, agree to treat, and to take no action inconsistent with the treatment of, the Trust
Certificates for such tax purposes as partnership interests in the Issuer.

     Each Certificateholder, by its acceptance of a Trust Certificate, covenants and agrees that
such Certificateholder will not at any time institute against the Depositor, or join in any
institution against the Depositor of, any bankruptcy, reorganization, arrangement, insolvency or
liquidation proceedings, or other proceedings under any United States federal or state bankruptcy
or similar law in connection with any obligations relating to the Trust Certificates, the Notes,
the Trust Agreement or any other Basic Document.

     Distributions on this Trust Certificate will be made as provided in the Trust Agreement by the
Owner Trustee by wire transfer or check mailed to the Certificateholder of record in the
Certificate Register without the presentation or surrender of this Trust Certificate or the making
of any notation hereon. Except as otherwise provided in the Trust Agreement and notwithstanding
the above, the final distribution on this Trust Certificate will be made after due notice by the
Owner Trustee of the pendency of such distribution and only upon presentation and surrender of this
Trust Certificate at the office or agency maintained for the purpose by the Owner Trustee.

     Reference is hereby made to the further provisions of this Trust Certificate set forth on the
reverse hereof, which further provisions shall for all purposes have the same effect as if set
forth at this place.

A-2

 

     Unless the certificate of authentication hereon shall have been executed by an authorized
officer of the Owner Trustee or the authenticating agent, by manual signature, this Trust
Certificate shall not entitle the Holder hereof to any benefit under the Trust Agreement or the
Sale and Servicing Agreement or be valid for any purpose.

     THIS TRUST CERTIFICATE SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF
DELAWARE, WITHOUT REFERENCE TO ITS CONFLICT OF LAW PROVISIONS, AND THE OBLIGATIONS, RIGHTS AND
REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.

     IN WITNESS WHEREOF, the Owner Trustee, on behalf of the Issuer and not in its individual
capacity, has caused this Trust Certificate to be duly executed.

	 	 	 	 	 	 	 
	 	 	HONDA AUTO RECEIVABLES 2009-2 OWNER TRUST	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	CITIBANK, N.A.,	 	 
	 

	 	 	 	not in its individual capacity but solely as Owner Trustee on
behalf of the Trust	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Authorized Signatory	 	 

OWNER TRUSTEE’S OR AUTHENTICATING AGENT’S CERTIFICATE OF

AUTHENTICATION

This is one of the Trust Certificates referred to in the within-mentioned Trust Agreement.

	 	 	 
	CITIBANK, N.A.,

not in its individual capacity but
solely as Authenticating Agent on
behalf of the Trust

	 	CITIBANK, N.A., not in its
individual capacity but
solely as Owner Trustee on
behalf of the Trust

OR...

	 	 	 	 	 
	By:

	 	 	 	 
	 

	 	 	 	 
	 

	 	Authenticating Agent	 	 

	 	 	 	 	 	 	 	 	 
	By:

	 	 	 	 	 	 	 	 
	 

	 	 
	 	 	 	 	 	 
	 

	 	Authorized Signatory	 	 	 	 	 	 

A-3

 

[REVERSE OF TRUST CERTIFICATE]

     The Trust Certificates do not represent an obligation of, or an interest in, the Depositor,
the Servicer, the Owner Trustee or any of their respective affiliates and no recourse may be had
against such parties or their assets, except as expressly set forth or contemplated herein or in
the Trust Agreement or the other Basic Documents. In addition, this Trust Certificate is not
guaranteed by any governmental agency or instrumentality and is limited in right of payment to
certain collections and recoveries with respect to the Receivables (and certain other amounts), all
as more specifically set forth herein and in the Sale and Servicing Agreement. A copy of each of
the Sale and Servicing Agreement and the Trust Agreement may be examined by any Certificateholder
upon written request during normal business hours at the principal office of the Depositor and at
such other places, if any, designated by the Depositor.

     The Trust Agreement permits, with certain exceptions therein provided, the amendment thereof
and the modification of the rights and obligations of the Depositor and the rights of the
Certificateholders under the Trust Agreement at any time by the parties thereto with the consent of
the Holders of the Trust Certificates and the Notes, each voting as a class, evidencing not less
than a majority of the Percentage Interests evidenced by the outstanding Trust Certificates, or a
majority of the outstanding principal balance of the Notes of each such class. Any such consent by
the Holder of this Trust Certificate shall be conclusive and binding on such Holder and on all
future Holders of this Trust Certificate and of any Trust Certificate issued upon the transfer
hereof or in exchange herefor or in lieu hereof, whether or not notation of such consent is made
upon this Trust Certificate. The Trust Agreement also permits the amendment thereof, in certain
limited circumstances, without the consent of the Holders of any of the Trust Certificates.

     As provided in the Trust Agreement and subject to certain limitations therein set forth, the
transfer of this Trust Certificate is registrable in the Certificate Register upon surrender of
this Trust Certificate for registration of transfer at the offices or agencies of the Certificate
Registrar maintained by the Owner Trustee, accompanied by a written instrument of transfer in form
satisfactory to the Owner Trustee and the Certificate Registrar duly executed by the Holder hereof
or such Holder’s attorney duly authorized in writing, and thereupon one or more new Trust
Certificates evidencing the same original certificate balance in the Issuer will be issued to the
designated transferee.

     Except as provided in the Trust Agreement, the Trust Certificates are issuable only as
registered Trust Certificates. As provided in the Trust Agreement and subject to certain
limitations therein set forth, Trust Certificates are exchangeable for new Trust Certificates
evidencing the same aggregate original certificate balance, as requested by the Holder surrendering
the same. No service charge will be made for any such registration of transfer or exchange, but
the Owner Trustee or the Certificate Registrar may require payment of a sum sufficient to cover any
tax or governmental charge payable in connection therewith.

     The Owner Trustee, the Certificate Registrar and any agent of the Owner Trustee or the
Certificate Registrar may treat the Person in whose name this Trust Certificate is registered as
the owner hereof for all purposes, and none of the Owner Trustee, the Certificate Registrar or any
such agent shall be affected by any notice to the contrary.

A-4

 

     The obligations and responsibilities created by the Trust Agreement and the Issuer created
thereby shall terminate upon the payment to Certificateholders of all amounts required to be paid
to them pursuant to the Trust Agreement and the Sale and Servicing Agreement and the disposition of
all property held as part of the Owner Trust Estate. The Servicer of the Receivables may at its
option purchase the Owner Trust Estate at a price specified in the Sale and Servicing Agreement,
and such purchase of the Receivables and other property of the Issuer will effect early retirement
of the Trust Certificates; provided, however, such right of purchase is exercisable only as of the
last day of any Collection Period as of which the Pool Balance is less than or equal to 10% of the
Original Pool Balance.

     The Trust Certificates may not be acquired or held by a Benefit Plan Investor. By accepting
and holding this Trust Certificate, the Holder hereof shall be deemed to have represented and
warranted that it is not a Benefit Plan Investor.

A-5

 

ASSIGNMENT

FOR VALUE RECEIVED the undersigned hereby sells, assigns and transfers unto

PLEASE INSERT SOCIAL SECURITY OR

OTHER IDENTIFYING NUMBER OF ASSIGNEE

 

(Please print or type name and address, including postal zip code, of assignee)

the within Trust Certificate, and all rights thereunder, any hereby irrevocably
constitutes and appoints                                         , attorney, to transfer said Trust
Certificate on the books of the Certificate Registrar, with full power of
substitution in the premises.

	 	 	 	 	 
	 	 	 
	 	 	Signature Guaranteed:
  
	 

	 	 	 	 

 

			
	NOTICE: The signature to this assignment must correspond with the
name of the registered owner as it appears on the face of the within Trust
Certificate in every particular, without alteration, enlargement or any change
whatsoever. Such signature must be guaranteed by an “eligible guarantor
institution” meeting the requirements of the Certificate Registrar, which
requirements include membership or participation in STAMP or such other
“signature guarantee program” as may be determined by the Certificate Registrar
in addition to, or in substitution for, STAMP, all in accordance with the
Securities Exchange Act of 1934, as amended.

A-6

 

EXHIBIT B

FORM OF TRANSFEROR CERTIFICATE

                    , ___

[Seller]

	 	 	 
	 

	 	 
	 
	 	 
	 

	 	 
	 
	 	 
	 

	 	 
	 
	 	 
	CITIBANK, N.A.

388 Greenwich Street, 14th Floor

New York, New York 10013
	 	 

			
	     Re:	 	Honda Auto Receivables 2009-2 Owner Trust

Asset Backed Certificates                                  

Dear Sirs:

     In connection with our disposition of the above-referenced Asset Backed Certificates (the
“Certificates”) we certify that (i) we understand that the Certificates have not been registered
under the Securities Act of 1933, as amended (the “Act”), and are being transferred by us in a
transaction that is exempt from the registration requirements of the Act and (ii) we have not
offered or sold any Certificates to, or solicited offers to buy any Certificates from, any person,
or otherwise approached or negotiated with any person with respect thereto, in a manner that would
be deemed, or taken any other action which would result in, a violation of Section 5 of the Act.

	 	 	 	 	 	 	 
	 	 	Very truly yours,

[NAME OF TRANSFEROR]	 	 
	 
	 	 	 	 	 	 
	 

	 	By	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Authorized Officer	 	 

B-1

 

EXHIBIT C

FORM OF INVESTMENT LETTER

                    , ___

Seller

	 	 	 
	 

	 	 
	 
	 	 
	 

	 	 
	 
	 	 
	 

	 	 
	 
	 	 
	CITIBANK, N.A.

388 Greenwich Street, 14th Floor

New York, New York 10013
	 	 

			
	     Re:	 	Honda Auto Receivables 2009-2 Owner Trust

Asset Backed Certificates                                  

Dear Sirs:

     In connection with our acquisition of the above-referenced Asset Backed Certificates (the
“Certificates”) we certify that (a) we understand that the Certificates are not being registered
under the Securities Act of 1933, as amended (the “Act”), or any state securities laws and are
being transferred to us in a transaction that is exempt from the registration requirements of the
Act and any such laws, (b) we are an “accredited investor,” as defined in Regulation D under the
Act, and have such knowledge and experience in financial and business matters that we are capable
of evaluating the merits and risks of investments in the Certificates, (c) we have had the
opportunity to ask questions of and receive answers from the Seller concerning the purchase of the
Certificates and all matters relating thereto or any additional information deemed necessary to our
decision to purchase the Certificates, (d) we are acquiring the Certificates for investment for our
own account and not with a view to any distribution of such Certificates (but without prejudice to
our right at all times to sell or otherwise dispose of the Certificates in accordance with clause
(f) below), (e) we have not offered or sold any Certificates to, or solicited offers to buy any
Certificates from, any person, or otherwise approached or negotiated with any person with respect
thereto, or taken any other action that would result in a violation of Section 5 of the Act or any
state securities laws, (f) we are not a Benefit Plan Investor and (g) we will not sell, or
otherwise dispose of any Certificates unless (i) such sale, transfer or other disposition is made
pursuant to an effective registration statement under the Act and in compliance with any state
securities laws or is exempt from such registration requirements and, if requested, we will at our
expense provide an Opinion of Counsel satisfactory to the addresses of this certificate that such
sale, transfer or other disposition may be made pursuant to an exemption from the Act, (ii) the
purchaser or transferee of such Certificate has executed and delivered to you a certificate to
substantially the same effect as this certificate and (iii) the purchaser or transferee has
otherwise complied with any conditions for transfer set forth in the Amended and Restated Trust
Agreement dated as of May 12, 2009, between American Honda Receivables Corp., as depositor,

C-1

 

Citibank, N.A., as Owner Trustee and Citigroup Trust-Delaware, National Association, as
Delaware Trustee.

	 	 	 	 	 	 	 
	 	 	Very truly yours,

[NAME OF TRANSFEROR]	 	 
	 
	 	 	 	 	 	 
	 

	 	By	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Authorized Officer	 	 

C-2

 

EXHIBIT D

FORM OF RULE 144A LETTER

                    , 20___

Seller

	 	 	 
	 

	 	 
	 
	 	 
	 

	 	 
	 
	 	 
	 

	 	 
	 
	 	 
	CITIBANK, N.A.

388 Greenwich Street, 14th Floor

New York, New York 10013
	 	 

			
	     Re:	 	Honda Auto Receivables 2009-2 Owner Trust

Asset Backed Certificates                                  

Dear Sirs:

     In connection with our acquisition of the above-referenced Asset Backed Certificates (the
“Certificates”) we certify that (a) we understand that the Certificates are not being registered
under the Securities Act of 1933, as amended (the “Act”), or any state securities laws and are
being transferred to us in a transaction that is exempt from the registration requirements of the
Act and any such laws, (b) we have such knowledge and experience in financial and business matters
that we are capable of evaluating the merits and risks of investments in the Certificates, (c) we
have had the opportunity to ask questions of and receive answers from the Seller concerning the
purchase of the Certificates and all matters relating thereto or any additional information deemed
necessary to our decision to purchase the Certificates, (d) we have not, nor has anyone acting on
our behalf, offered, transferred, pledged, sold or otherwise disposed of the Certificates or an
interest in the Certificates, or solicited any offer to buy, transfer, pledge or otherwise dispose
of the Certificates or any interest in the Certificates from any person in any manner or made any
general solicitation by means of general advertising or in any other manner, taken any other action
that would constitute a distribution of the Certificates under the Act or that would render the
disposition of the Certificates a violation of Section 5 of the Act or any state securities laws or
require registration pursuant thereto, and we will not act, or authorize any person to act, in such
manner with respect to the Certificates, (e) we are not a Benefit Plan Investor and (f) we are a
“qualified institutional buyer” as that term is defined in Rule 144A under the Act. We are aware
that the sale to us is being made in reliance on Rule 144A. We are acquiring the certificates for
our own account or for resale pursuant to Rule 144A and understand that such certificates may be
resold, pledged or transferred only (i) to a person reasonably believed to be a qualified
institutional buyer that purchases for its own account or for the account of a qualified
institutional buyer to whom notice is given that the resale, pledge or transfer is being made in
reliance on Rule 144A or (ii) pursuant to another exemption from registration under the Act.

 

	 	 	 	 	 	 	 
	 	 	Very truly yours,

[NAME OF TRANSFEREE]	 	 
	 
	 	 	 	 	 	 
	 

	 	By	 	 	 	 
	 

	 	 	 	Authorized OfficerEX-4.3

Exhibit 4.3

DE BRAUW          

BLACKSTONE

WESTBROEK     

Sale and Contribution Agreement

     relating to

a joint venture in the field of
 semiconductors for
cellular communication

     between

STMicroelectronics N.V.

     and

NXP B.V.

     dated 10 April 2008

	 	 	 
	 

	 	P.O. Box 75084
	 

	 	1070 AB Amsterdam
	 

	 	The Netherlands

 

	 	 	 	 	 	 	 
	 
	 	Contents	 	 	 	 
	 
	 	 	 	 	 	 
	 
	 	Clause	 	Page
	1
	 	Interpretation 	 	 	4	 
	2
	 	Transaction Structure 	 	 	5	 
	3
	 	Closing Conditions 	 	 	7	 
	4
	 	Pre-Closing covenants 	 	 	11	 
	5
	 	Closing 	 	 	17	 
	6
	 	Post-Closing obligations 	 	 	18	 
	7
	 	Warranties and liability 	 	 	26	 
	8
	 	Limitation of liability 	 	 	28	 
	9
	 	Claims 	 	 	30	 
	10
	 	Confidentiality 	 	 	32	 
	11
	 	Miscellaneous 	 	 	33	 

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Sale and Contribution Agreement

THIS AGREEMENT IS MADE BETWEEN:

	(1)	 	STMicroelectronics N.V., a public company with limited liability incorporated under the
laws of the Netherlands, with corporate seat in Amsterdam, the Netherlands, and address
at WTC Schiphol Airport, Schiphol Boulevard 265,1118 BH Schiphol Airport, Amsterdam,
the Netherlands, (“ST”);
	 
	 	 	and
	 
	(2)	 	NXP B.V., a private company with limited liability incorporated under the laws of the
Netherlands, with corporate seat in Eindhoven, the Netherlands, and address at High Tech
Campus 60, 5656 AG Eindhoven, the Netherlands, (“NXP”).

WHEREAS:

	(A)	 	ST and NXP wish to establish a joint venture (the “Joint Venture”) in the field of
semiconductors for cellular communication, being (i) in the case of ST those parts of its
Mobile, Multimedia and Communications Groups, relating to the businesses Baseband, RF, Power
Management Unit, Multimedia, Bluetooth, FM Radio, WiFi and UWB, (as further specified in
Schedule 2, “ST’s Relevant Businesses”); and, (ii) in the case of NXP, those parts of
its Mobile and Personal Business Unit relating to the businesses Baseband, RF, Power
Management Unit, Multimedia, Bluetooth, FM Radio, GPS, USB and UWB, (as further specified in
Schedule 3 “NXP’s Relevant Businesses” and together with ST’s Relevant Businesses,
the “Business”) on and subject to the terms and conditions set out in this Agreement, (the
“Transaction”);
	 
	(B)	 	The Parties signed a confidentiality agreement on 3 October 2007, regarding the disclosure
to each other and each other’s representatives and advisors, of information in connection
with the Transaction (the “Confidentiality Agreement”), as well as a non-binding Memorandum
of Understanding, dated 22 January 2008 (“MoU”) setting forth certain principal terms and the
process of due diligence and negotiation of transaction documents;
	 
	(C)	 	Pursuant to the MoU, the Parties have given each other and their respective representatives
and advisors access to each other’s Data Room, as well as the opportunity to attend a
management presentation, to make joint customer visits and to request such additional
information as deemed necessary;
	 
	(D)	 	Pursuant to the MoU, ST and NXP have negotiated the main terms and conditions of certain of
the transaction documents under which the Joint Venture is intended to be established and the
relationship between the shareholders in the Joint Venture is intended to be regulated (the
“Transaction Documents”);

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	 	(E)	 	The relevant corporate approvals required prior to the signing of the
Transaction
Documents have been obtained by each Party;
	 
	 	(F)	 	The Parties wish to set out in this Sale and Contribution Agreement (the
“Agreement”),
which forms part of the Transaction Documents, the terms and conditions for the
establishment of the Joint Venture.

	 	 	IT IS AGREED AS FOLLOWS:
	 
	1	 	INTERPRETATION
	 
	 	 	In this Agreement, unless the context otherwise requires, the provisions in this Clause 1
apply throughout:
	 
	1.1	 	Definitions
	 
	 	 	Capitalised words, including those used in the preamble of this Agreement, shall have the
meaning as defined in Schedule 1.
	 
	1.2	 	References to persons and companies
	 
	 	 	References to:

	 	1.2.1	 	a person include any individual, company, partnership or unincorporated association
(whether or not having separate legal personality); and
	 
	 	1.2.2	 	a company include any company, corporation or any body corporate, wherever
incorporated.

	1.3	 	Headings and references to Clauses, Schedules, Parts and Paragraphs

	 	1.3.1	 	Headings have been inserted for convenience of reference only and do not affect the
interpretation of any of the provisions of this Agreement.
	 
	 	1.3.2	 	A reference in this Agreement to a Clause or Schedule is to the relevant Clause of or
Schedule to this Agreement; to a Part is to the relevant Part of the relevant Schedule;
and to a Paragraph is to the relevant Paragraph of (the relevant Part of) the relevant
Schedule.

	1.4	 	ST / NXP / ST’s Relevant Businesses / NXP’s Relevant Businesses

	 	1.4.1	 	Any reference in this Agreement to the term “ST shall”, shall be interpreted as
meaning that ST shall and/or shall procure that the relevant other members of the ST
Group shall perform the relevant obligation.
	 
	 	1.4.2	 	Any reference in this Agreement to a liability or obligation of ST’s Relevant
Businesses shall be deemed to include an obligation on the part of ST to procure that the
relevant liability is discharged or obligation is performed, on and subject to the terms
and conditions set out in this Agreement.
	 
	 	1.4.3	 	Any reference in this Agreement to the term “NXP shall”, shall be interpreted as
meaning
that NXP shall and/or shall procure that the relevant other members of the NXP Group
shall

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	 	 	 	perform the relevant obligation.
	 
	 	1.4.4	 	Any reference in this Agreement to a liability or obligation of NXP’s Relevant
Businesses shall be deemed to include an obligation on the part of NXP to procure that the
relevant liability is discharged or obligation is performed, on and subject to the terms and
conditions set out in this Agreement.

	1.5	 	Other references

	 	1.5.1	 	Whenever used in this Agreement, the words “include”, “includes” and “including” shall
be deemed to be followed by the phrase “without limitation”.
	 
	 	1.5.2	 	Any reference in this Agreement to any gender shall include all genders, and words
importing the singular shall include the plural and vice versa.

	1.6	 	Information
	 
	 	 	References to books, records or other information include books, records or other information
in any form including paper, electronically stored data, magnetic media, film and microfilm.
	 
	1.7	 	Legal terms
	 
	 	 	In respect of any jurisdiction other than the Netherlands, a reference to any Netherlands
legal term shall be construed as a reference to the term or concept which most nearly
corresponds to it in that jurisdiction.
	 
	2	 	TRANSACTION STRUCTURE
	 
	 	 	Subject to satisfaction (or waiver under Clause 3.4) of the Closing Conditions, the Parties
shall take the following actions to effect the Transaction:
	 
	2.1	 	ST contribution
	 
	 	 	ST shall establish a new company as a wholly owned subsidiary of ST, which company shall be a
Dutch tax resident private company with limited liability organised under the laws of the
Netherlands (as further defined in Schedule 10, the “Company”) and ST shall subscribe
for newly issued shares in the capital of the Company (the “ST JV Shares”). The payment
obligation for the ST JV Shares shall be satisfied by way of a contribution to the Company of:

	 	2.1.1	 	ST’s Relevant Businesses;
	 
	 	2.1.2	 	(i) USD 1,520,000,000 (one billion five hundred and twenty million US dollar) together
with (ii) an amount in EURO equal to 80% of the net present value of the R&D Tax Credits at
Closing, taking into account a 10% discount rate, in cash, to fund the cash payment to be
made by the Company pursuant to Clause 2.3.2 (the “Cash Payment”);
	 
	 	2.1.3	 	USD 350,000,000 (three hundred and fifty million US dollar) in cash, to fund working
capital requirements and allow for certain cash flexibility;
	 
	 	the foregoing in accordance with ST’s Disentanglement Plan and Schedule 10.

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	2.2	 	NXP contribution
	 
	 	 	NXP shall establish two new companies (as further defined in Schedule 10, “WH1” and
“WH2”) and:

	 	2.2.1	 	to WH1 it shall transfer its Dutch Relevant Businesses and the NXP Relevant IP related
thereto;
	 
	 	2.2.2	 	to WH2 it shall transfer its non-Dutch Relevant Businesses and the NXP Relevant IP related
thereto,
	 
	 	the foregoing in accordance with NXP’s Disentanglement Plan and Schedule 10.

	2.3	 	Transfer by NXP to the Joint Venture
	 
	 	 	At Closing, NXP shall transfer to the Company, in two separate steps, the following:

	 	2.3.1	 	in the first step, certain shares of WH1 (pursuant to which NXP shall still retain control
of WH1) in return for Shares of the Company;
	 
	 	2.3.2	 	in the second step:

	 	(a)	 	all other shares of WH1;
	 
	 	(b)	 	all the shares of WH2;
	 
	 	in return for (i) further Shares of the Company representing, together with the Shares of
the Company issued to NXP as referred to in Clause 2.3.1, a shareholding of 20% (twenty
per cent) in the Company and (ii) the Cash Payment.

	2.4	 	No Transfer of Liabilities other than Assumed Liabilities

	 	2.4.1	 	ST undertakes to the Company and NXP to procure that ST’s Relevant Businesses are
contributed to the Company or the relevant Group Company free of Liabilities, with the
exception only of the ST Assumed Liabilities which shall be contributed together with ST’s
Relevant Businesses, subject to Clause 2.4.3 and Clause 6.5 through Clause 6.10 to the extent
(i) they are ST Assumed Financial Liabilities that must transfer along with the Relevant
Businesses following mandatory law, such as certain of the Unfunded Defined Benefit
Liabilities, or because they are part of a ST Entity provided that in such case these
Liabilities cannot be redeemed or reimbursed prior to Closing, or (ii) as they are deemed ST
Assumed Business Liabilities in accordance with Paragraph 4.2 of Schedule 2.
	 
	 	2.4.2	 	NXP undertakes to the Company and ST to procure that NXP’s Relevant Businesses are
contributed to the Company or the relevant Group Company free of Liabilities, with the
exception only of the NXP Assumed Liabilities which shall be contributed together with NXP’s
Relevant Businesses, subject to Clause 2.4.3 and Clause 6.5 through Clause 6.10, to the
extent (i) they are NXP Assumed Financial Liabilities that must transfer along with the
Relevant Businesses following mandatory law, such as certain of the Unfunded Defined Benefit
Liabilities, or because they are part of a NXP Entity provided that in such case these
Liabilities cannot be redeemed or reimbursed prior to Closing, or as (ii) they are deemed NXP
Assumed Business Liabilities in accordance with Paragraph 3.2 of Schedule 3 .

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	 	2.4.3	 	Each Party undertakes, in respect of each Assumed Financial Liability relating
to its Relevant Businesses, to fully fund in Cash any such Assumed Financial Liability in
accordance with the Draft Assumed Financial Liability Statement referred to in Clause 4.10
prior to contributing the Relevant Businesses at Closing.
	 
	 	2.4.4	 	Subject to Clause 2.4.3 and Clauses 6.5 through 6.10 and the R&Ws, as of Closing, the
Company or relevant other Group Company shall assume, pay when due, satisfy, discharge,
perform and fulfil, to the extent relating to the Relevant Businesses, all Assumed
Liabilities.
	 
	 	2.4.5	 	The Retained Liabilities, identified for NXP in Paragraph 3.4 of Schedule 3 and for
ST in Paragraph 3.4 of Schedule 2 shall remain for the account of the relevant member
of the NXP Group and ST Group after Closing and be subject to Clause 6.10 and the relevant
provisions of Schedule 2 and Schedule 3.

	2.5	 	Adjustment to consideration
	 
	 	 	If any payment is made by NXP to ST, or from ST to NXP, in respect of any claim (i) for any
breach of this Agreement (including, for the avoidance of doubt, a breach of the R&Ws), (ii)
pursuant to an indemnity under this Agreement or (iii) for acquiring the T3G Shares as set forth
in Clause 4.12, the amount of such payment shall deemed to be an adjustment of the consideration
in Shares to be paid by the Company to NXP or ST, as the case may be, for the transfer of their
respective Relevant Businesses.

	3	 	CLOSING CONDITIONS
	 
	3.1 	 	Conditions
	 
	 	 	Closing is conditional upon satisfaction (or waiver under Clause 3.4) of the following Closing
Conditions:

	 	3.1.1	 	the Closing Anti-trust Approvals shall have been obtained or, alternatively, any waiting
periods under the laws applicable to such approvals shall have expired or been terminated;
	 
	 	3.1.2	 	the completion of NXP’s procedure in respect of the Transaction in compliance with section
25 of the Dutch Works Council Act (“WCA”), such completion to include:

	 	(a)	 	the receipt by NXP from its Dutch works council (“NXP’s Works Council”) of:

	 	(i)	 	an unconditional positive advice; or
	 
	 	(ii)	 	an advice with conditions acceptable to each of the Parties and
if required in accordance with Clause 3.3.3; or

	 	(b)	 	a resolution of NXP’s board in respect of the Transaction that deviates from
NXP’s
Works Council’s advice and:

	 	(i)	 	against which NXP’s Works Council has not timely lodged an appeal
with the Enterprise Chamber of the Amsterdam Court of Appeal
(“Ondernemingskamer”); or
	 
	 	(ii)	 	against which NXP’s Works Council has timely lodged an appeal with the

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	 	 	 	Enterprise Chamber of the Amsterdam Court of Appeal which appeal is
subsequently dismissed by such court and if required in accordance with
Clauses 3.3.5 and 3.3.6.

	 	3.1.3	 	the completion of the information and consultation procedure of ST’s French works
council(s) (“ST’s Works Council(s)”), with respect to the Transaction, in compliance with
French law, including ST’s Works Council’s request (if any) for assistance by an expert;
	 
	 	3.1.4	 	there not being a breach by NXP of its obligations under Clause 4 that would be reasonably
likely to have a Material Adverse Effect;
	 
	 	3.1.5	 	there not being a breach by ST of its obligations under Clause 4 that would be reasonably
likely to have a Material Adverse Effect;
	 
	 	3.1.6	 	the R&Ws given by each of ST and NXP shall be true and accurate, in each case as at the
time set for Closing under Clause 5.2 (or, if applicable, Clause 5.4), as though made as at
such time (unless any such R&W is made only as of a specific date, in which event such R&W
shall be true and accurate as of such specified date), except where the breach of any R&W has
not had and is not reasonably likely to have a Material Adverse Effect;
	 
	 	3.1.7	 	no Governmental Authority of competent jurisdiction shall have issued or granted any order
(whether temporary, preliminary or permanent) or otherwise taken any affirmative action that
has the effect of making the consummation of the Transaction illegal in any jurisdiction in
which the Business or the Parties have any material business or operations or which has the
effect of prohibiting or otherwise preventing the consummation of the Transaction; and
	 
	 	3.1.8	 	each of the Ancillary Agreements being in Agreed Terms, save to the extent that any terms
not thus agreed (i) have already been included in the relevant Term Sheet or (ii) would not,
by their absence, be reasonably expected to have a material financially adverse effect on ST
or NXP, as the case may be, or materially hinder the Relevant Businesses from continuing
their business in the Company (or as Affiliate(s) of the Company) as of Closing. Any such
material terms which have not been already included in the relevant Term Sheet shall be
negotiated between the Parties in good faith, in order to come to full Agreed Terms prior to
Closing in accordance with Clause 4.2.

	3.2	 	Responsibility for satisfaction

	 	3.2.1	 	To the maximum extent permitted under applicable Law, each of the Parties shall take all
such actions within its power as are necessary to ensure satisfaction of and compliance with
the Closing Conditions for which it is responsible, being Clauses 3.1.1, 3.1.3, 3.1.5, 3.1.7
(to the extent relating to ST’s Relevant Businesses) and 3.1.8 for ST and Clauses 3.1.1,
3.1.2, 3.1.4, 3.1.7 (to the extent relating to NXP’s Relevant Businesses) and 3.1.8 for NXP.
	 
	 	3.2.2	 	Without prejudice to the generality of Clause 3.2.1, with respect to the Closing Conditions
set out in Clause 3.1.1 (Closing Anti-trust Approvals) and 3.1.2 (NXP’s Works Council), each
of the Parties shall fulfil its obligations and exercise its rights in good faith in relation
to a Closing Condition. Although Parties acknowledge that each Party may protect its
legitimate interests in relation to such Closing Condition while exercising such rights in

8

 

	 	 	 	good faith no Party shall act in a manner which would unduly frustrate the
satisfaction thereof.
	 
	 	3.2.3	 	Without prejudice to the generality of Clauses 3.2.1 and 3.2.2, ST and NXP shall, either
jointly or in close consultation with each other:

	 	(a)	 	as soon as practicable, and in any event not later than fifteen (15)
Business Days after the Signing Date, prepare and file with the competent
Governmental Authorities the notices and applications necessary to satisfy the
Closing Condition set out in Clause 3.1.1;
	 
	 	(b)	 	supply as promptly as practicable any additional information and documentary
material that may be requested by any competent Governmental Authority in connection
with the Closing Condition set out in Clause 3.1.1 and otherwise cooperate with and
provide all necessary information and assistance reasonably required by any
Governmental Authority in connection with the Closing Condition set out in Clause
3.1.1; and
	 
	 	(c)	 	use their best efforts to cause the expiration or termination of any
applicable waiting period under any applicable Law and the fulfilment (whether
explicit or implicit) of the Closing Condition set out in Clause 3.1.1 as soon as
practicable, including by agreeing to (i) take any action that may be required in
order to obtain an unconditional clearance (including by agreeing to perform any
disposition of assets or businesses that may be required by any relevant Governmental
Authority) or (ii) duly and promptly complying with any condition that any relevant
Governmental Authority may impose to clear this Agreement and the Transaction,
provided that the foregoing provisions of this Clause 3.2.3(c) shall not require ST
or NXP to agree to or take any action or comply with any condition which would,
indirectly or in the aggregate, be material to ST or NXP, as the case may be, in the
context of this Transaction.

	 	3.2.4	 	In the event that any administrative or judicial action or proceeding is instituted (or
threatened to be instituted) by a Governmental Authority or any other person challenging
(any part of) the Transaction, each Party shall co-operate in all respects with the other
Party and use its reasonable best efforts to defend, contest and resist any such action or
proceeding and to have vacated, lifted, reversed or overturned any order, whether
temporary, preliminary or permanent, that is in effect and that prohibits, prevents or
restricts the consummation of the Transaction.

	3.3	 	Works Councils

	 	3.3.1	 	ST shall use its reasonable best efforts to:

	 	(a)	 	take any such reasonable action as is required to complete the information
and consultation procedure with ST’s Works Council and obtain a written opinion from
ST’s Works Council; and

9

 

	 	(b)	 	promptly co-operate with and (as promptly as practicable) provide all necessary
information and assistance reasonably required by ST’s Works Council.

	 	3.3.2	 	NXP shall use its reasonable best efforts to:

	 	(a)	 	take any such reasonable action as is required to obtain an unconditional
positive advice or an advice with conditions from NXP’s Works Council which are
accepted by each of the Parties in accordance with Clause 3.3.3, subject to Clauses
3.3.5 and 3.3.6 below; and
	 
	 	(b)	 	(promptly) co-operate with and (as promptly as practicable) provide all
necessary information and assistance reasonably required by NXP’s Works Council.

	 	3.3.3	 	Each Party shall provide the other Party with the necessary information concerning assets
and Employees within ten (10) Business Days following the date of this Agreement in order to
enable such Party to comply with its obligations under Clauses 3.3.1 and 3.3.2.
	 
	 	3.3.4	 	If any conditions or arrangements in relation to the Group are introduced by NXP’s Works
Council in its advice as referred to in Clause 3.3.2, these conditions shall not be accepted
by NXP, unless with the prior written consent of ST. Once approval for these conditions, that
might include arrangements that are binding upon the Company and /or the Group Companies,
have been given by each of ST and NXP, the Parties shall negotiate on the changes (if any) to
the Transaction Documents which are appropriate under the circumstances, bearing in mind the
intent and purpose of the terms and conditions set forth in the Transaction Documents. The
Parties agree and acknowledge that such negotiations should take place in good faith and as
far as reasonably possible should be consistent with the understandings of the parties
reflected in the Transaction Documents.
	 
	 	3.3.5	 	If, after Clauses 3.3.2(a), 3.3.2(b) and 3.3.3 have been complied with, NXP’s Works Council
still has not rendered an unconditional positive advice or an advice with conditions
acceptable to each of the Parties, then NXP shall, unless otherwise agreed by ST, after
receipt of the advice, inform NXP’s Works Council in writing of:

	 	(i)    the resolution of the board of NXP in respect of the Transaction;

and if and insofar as such resolution deviates from the advice:
	 
	 	(ii)	 	the grounds and motives for such deviation.

	 	3.3.6	 	If Clause 3.3.3 applies, Closing shall be postponed for a period equal to one calendar
month after the day on which NXP informed NXP’s Works Council in writing of its board
resolution as set out in Clause 3.3.5, provided that, if NXP’s Works Council has appealed to
the Enterprise Chamber of the Amsterdam Court of Appeal (Ondernemingskamer) in respect of
such board resolution, Closing shall be postponed until three (3) Business Days after NXP has
received a court order from the Enterprise Chamber of the Amsterdam Court of Appeal
dismissing such appeal and allowing the Parties to effect the Closing.
	 
	 	3.3.7	 	For the purpose of this Clause 3.3 and Clause 3.1.2, the use of the defined term “NXP”
shall include the Dutch Affiliate for which NXP’s Works Council has been established.

10

 

	3.4	 	(Non-)Satisfaction/Waiver

	 	3.4.1	 	Within two (2) Business Days of becoming aware of the same, ST shall give
notice to NXP or vice versa, as applicable, of (i) the satisfaction of the
Closing Conditions set out in Clause 3.1 for which it is responsible, as set out
in Clause 3.2.1, or of (ii) any fact or circumstance which could result in a
Closing Condition not being satisfied.
	 
	 	3.4.2	 	The Closing Conditions set out in Clauses 3.1.1, 3.1.2, and 3.1.8 may only
be waived by written agreement between ST and NXP.
	 
	 	3.4.3	 	The Closing Conditions set out in Clauses 3.1.3, 3.1.4, and 3.1.6 (in
relation to a breach by NXP of any R&Ws), may only be waived by ST.
	 
	 	3.4.4	 	The Closing Condition set out in Clauses 3.1.5, and 3.1.6 (in relation to a
breach by ST of any R&Ws), may only be waived by NXP.

	3.5	 	Long stop date
	 
	 	 	If the Closing Conditions are not satisfied (or waived under Clause 3.4) on or
before the date falling twelve (12) months after the date hereof NXP or ST may, in
its sole discretion, terminate this Agreement (other than Clauses 1,10 and 11.2
through 11.14) by notice to the other, and no Party shall have any claim against
the other save for any claim arising from breach of any obligation contained in
Clause 3.1.8, 3.3 or 3.4 provided that no such termination notice may be given by a
Party which is in default of its obligations under this Agreement.
	 
	4	 	PRE-CLOSING COVENANTS
	 
	4.1	 	Other Transaction Documents
	 
	 	 	Subject to Clause 4.2, ST and NXP shall negotiate in good faith definitive terms
for each of the following Transaction Documents:

	 	4.1.1	 	business sale, and share sale and purchase agreements (each a “Local
Transfer Agreement”) in respect of their Relevant Businesses;
	 
	 	4.1.2	 	two umbrella transitional services agreements (each a “TSA”) and service
level agreements (each an “SLA”):

	 	(a)	 	for the provision of transitional services by ST to the Company;
	 
	 	(b)	 	for the provision of transitional services by NXP to the Company;

	 	4.1.3	 	operational agreements between the Company on the one hand and one of more
of the
Parties and/or any of their respective Affiliates on the other (each an
“Operational
Agreement”), including:

	 	(a)	 	four Manufacturing Agreements:

	 	(i)	 	for the provision of manufacturing services by ST to the Company;
	 
	 	(ii)	 	for the provision of manufacturing services by the Company to ST;
	 
	 	(iii)	 	for the provision of manufacturing services by NXP to the Company; and

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	 	(iv)	 	for the provision of manufacturing services by the Company to NXP.

	 	(b)	 	one IP Transfer and Licence Agreement:

	 	(i)	 	for the transferring and licensing of IP by ST to the Company;
	 
	 	(ii)	 	for the transferring and licensing of IP by NXP to the Company;
	 
	 	(iii)	 	for the licensing of IP by the Company to ST (including
the licensing of UWB and GPS); and
	 
	 	(iv)	 	for the licensing of IP by the Company to NXP.

	 	(c)	 	one R&D Services Agreement:

	 	(i)	 	for the provision of R&D services by ST to the Company;
	 
	 	(ii)	 	for the provision of R&D services by the Company to ST
(including for UWB and GPS);
	 
	 	(iii)	 	for the provision of R&D services by NXP to the Company; and
	 
	 	(iv)	 	for the provision of R&D services by the Company to NXP.

	 	(d)	 	one Near Field Communication Technology License Agreement between NXP and the Company.

	4.2	 	Binding Term Sheets
	 
	 	 	It is recorded that in respect of some of the Transaction Documents the Parties have
negotiated term sheets, which are attached hereto in agreed form under Schedule 4
(the “Term Sheets”). As of Signing, the Parties shall negotiate in good faith definitive
agreements in respect of the Term Sheets. If, notwithstanding Clause 3.1.8, Closing occurs
but the Parties have not negotiated definitive agreements in respect of one or more of the
Term Sheets, the Parties shall continue to negotiate in good faith definitive agreements in
respect thereof and, unless otherwise agreed in writing, subject to and as of Closing, until
signing of such definitive agreements the relevant Term Sheets (as supplemented by such
further terms as may have been agreed to prior to Closing) shall be binding.

	4.3	 	Disentanglement

	 	4.3.1	 	Each Party, in preparation for the transfer of its Relevant Businesses to the Company
and the unwinding of the Newco-structure of WH2, has negotiated a Disentanglement Plan
(attached in draft form as Schedule 5 (ST Disentanglement Plan) and Schedule
6 (NXP Disentanglement Plan)), which is not final as at the date of Signing. The
Parties undertake to discuss in good faith the definitive terms of the Disentanglement
Plans (including the roadmaps setting out the various steps to unwind the Newco-structure
of WH2) in accordance with the principles laid down in the drafts attached hereto and to
finalise these definitive terms prior to Closing.
	 
	 	4.3.2	 	Each Party shall take the actions, and procure the taking of such actions, as set out
in its Disentanglement Plan (the “Disentanglement”), including the effecting of the Local
Transfer Documents, attached as Schedule 11, provided that:

	 	(a)	 	a Party shall not be in breach of its obligations under this Clause 4.3 to the
extent

12

 

	 	 	 	that its Relevant Businesses, as a result of the Party not having
taken or not having procured the taking of such actions, are not
materially hindered from continuing their business in the Company (or as
Affiliates of the Company) as of Closing. For the avoidance of doubt, NXP
not obtaining the Dutch tax ruling and ST not obtaining the Dutch and
Swiss tax rulings, shall be deemed a material hindrance of the continuity
of the business for the purpose of this Clause, provided that each of NXP
and ST acknowledge that time is of the essence and that each of them
shall file a ruling request with the relevant authorities within fifteen
(15) Business Days for the Dutch tax rulings and twenty-five (25)
Business Days for the Swiss tax ruling, after the date of this Agreement
and shall further diligently pursue obtaining the required rulings;
	 
	 	(b)	 	deviations from or supplements to the template Local Transfer
Documents may be necessary pursuant to mandatory local formalities to
effect the transfer; and
	 
	 	(c)	 	ST may not be able to obtain the French tax ruling on time
and, as a result, may not be ready to transfer the French assets and
liabilities at Closing to the Group. This will not delay Closing provided
that such business is conducted as from Closing for the account and the
benefit of the Group.

	4.4	 	Umbrella Agreements

	 	4.4.1	 	ST shall use its reasonable best efforts to procure that, as of Closing,
the Company and other members of the Group (as subsidiaries of ST) fall under
and benefit from the ST Umbrella Agreements.
	 
	 	4.4.2	 	If (i) consent of a counterparty to a ST Umbrella Agreement is required for
the aforesaid purpose but is not received prior to Closing; and (ii) one of the
NXP Umbrella Agreements concerns substantially the same subject as such ST
Umbrella Agreement, NXP shall notify the counterparty to such NXP Umbrella
Agreement of the transfer of the Relevant Businesses pursuant to this Agreement.
The Parties shall use reasonable best efforts to obtain a grace period of at
least three (3) months as of the Closing Date allowing the NXP Relevant
Businesses the continued enjoyment of such NXP Umbrella Agreement during such
period.
	 
	 	4.4.3	 	In the event that a NXP Umbrella Agreement concerns a subject that is not
covered by a ST Umbrella Agreement, NXP shall if so required by ST prior to
Closing notify the counterparty to such NXP Umbrella Agreement of the transfer
of the Relevant Businesses pursuant to this Agreement. The Parties shall use
reasonable best efforts to obtain a grace period of at least three (3) months as
of the Closing Date allowing the NXP Relevant Businesses the continued enjoyment
of such NXP Umbrella Agreement during such period.
	 
	 	4.4.4	 	Copies of all notifications together with any responses from the
counterparties of the ST Umbrella Agreements and the NXP Umbrella Agreements
will be provided to the Company, ST and NXP upon dispatch or receipt, as the
case may be.
	 
	 	4.4.5	 	The Parties shall use their reasonable best efforts to procure that,
during the aforesaid grace periods the Company, or relevant other member of the
Group, arranges with each such counterparty a new agreement, where applicable,
with retroactive effect as of the

13

 

	 	 	 	Closing Date. Any and all costs in relation to the use of NXP Umbrella Agreements
during such grace period and the entering into of any such new agreements shall be for the
account of the Company or relevant other member of the Group.

	4.5	 	Conduct of business
	 
	 	 	Subject to Clause 4.6, each of ST and NXP shall procure that between Signing and Closing each of
their Relevant Businesses:

	 	4.5.1	 	carries on business as a going concern in the ordinary course as carried on prior to
Signing, save as consented to in writing by the other Party, such consent not be unreasonably
withheld or delayed and save as contemplated in the Transaction Documents, including its
Disentanglement Plan;
	 
	 	4.5.2	 	without prejudice to the generality of Clause 4.5.1, does not, without the prior written
consent of the other Party, such consent not to be unreasonably withheld or delayed and save
as contemplated in the Transaction Documents, including its Disentanglement Plan:

	 	(a)	 	enter into any agreement or incur any commitment involving any capital
expenditure in excess of USD 3,000,000 (three million US dollar) per item and USD
15,000,000 (fifteen million US dollar) in aggregate per calendar quarter, in each case
exclusive of VAT;
	 
	 	(b)	 	enter into or amend any contract or commitment which (a) is not in the
ordinary course of business, or (b) involves or is likely to involve total annual
expenditure in excess of USD 10,000,000 (ten million US dollar), exclusive of VAT;
	 
	 	(c)	 	acquire or dispose of, or agree to acquire or dispose of, any material asset
or material inventory involving consideration, expenditure or liabilities in excess of
USD 3,000,000 (three million US dollar), exclusive of VAT, other than in the ordinary
course of business;
	 
	 	(d)	 	acquire or agree to acquire any share(s) or other interest in any person or company;
	 
	 	(e)	 	incur any additional borrowings or incur any other indebtedness in each case
in excess of USD 1,000,000 (one million US dollar) other than in the ordinary course
of business;
	 
	 	(f)	 	delay or cease any capital expenditure in respect of that Party’s Relevant
Businesses, as provided for in the budget made available to the other Party prior to
Signing;
	 
	 	(g)	 	create, allot or issue, or allow to be created, allotted or issued, any share
capital of any company that is part of that Party’s Relevant Businesses;
	 
	 	(h)	 	repay, redeem or repurchase, or allow to be repaid, redeemed or repurchased,
any share capital of any company that is part of that Party’s Relevant Businesses;
	 
	 	(i)	 	declare, make or pay any dividend or other distribution to any shareholders of
any company that is part of that Party’s Relevant Businesses; or
	 
	 	(j)	 	make any change in the terms and conditions of employment of any of its
directors or Senior Employees, other than in accordance with the applicable collective
labour

14

 

	 	 	 	agreement or similar annual indexation increase or consistent
with past practice, or employ or terminate the employment of any
director or Senior Employee or make any arrangements with any unions or
other employee representative bodies (including the entering into or,
amending of or deviation from any collective labour agreement or social
plan) enter into, adopt or make any material amendments or variations to
retirement benefit plans and other long-term benefit plans of the
Relevant Businesses.

	4.6	 	Excused conduct
	 
	 	 	A Party shall not invoke Clause 4.5.2 against the other Party if, in the latter
Party’s reasonable opinion, adherence to its obligations under Clause 4.5.2 would
have a Material Adverse Effect on its ability to continue to manage its Relevant
Businesses or have a Material Adverse Effect on the value of its Relevant
Businesses. Each Party shall inform the other Party of any such situation as soon
as reasonably practicable thereafter.

	4.7	 	Acting vis-á-vis the other Party
	 
	 	 	It is further agreed that:

	 	4.7.1	 	in applying and enforcing Clause 4.5.2, ST and NXP shall act vis-á-vis each
other in accordance with the principles of reasonableness and fairness giving
due consideration to all relevant circumstances; and
	 
	 	4.7.2	 	under certain circumstances a Party may not be able to timely request the
consent of the other Party, or await a response from that Party to such request,
if the circumstances require immediate action from the Party or management of
that Party’s Relevant Businesses, but that Party shall nevertheless inform the
other Party of any such situation as soon as reasonably practicable thereafter.

	4.8	 	Security
	 
	 	 	Without detracting from any R&Ws or indemnities set out in this Agreement, NXP
shall procure vis-á-vis the Company or the relevant member of the Group, that the
Collateral Agents (as such term is defined in each of (i) that certain Senior
Secured Indenture among NXP B.V. and NXP Funding LLC (as issuers) and the
Collateral Agents (as defined therein) dated 12 October 2006 and (ii) that certain
Collateral Agency Agreement among Kaslion Acquisition B.V., NXP B.V. and the
Collateral Agent (as defined therein) dated 29 September 2006) give written consent
(under Section 12.05 of the aforesaid Indenture and Section 5.03 of the aforesaid
Collateral Agency Agreement) to the release, at Closing, of all relevant Security
on any assets forming part of NXP’s Relevant Businesses.

	4.9	 	European works council and trade unions
	 
	 	 	As early as possible in order to comply with Laws, but in any event prior to Closing:

	 	4.9.1	 	each of ST and NXP shall consult with and notify, to the extent required,
its European and/or other works council(s) regarding the Transaction; and
	 
	 	4.9.2	 	each of NXP and ST shall, to the extent required, consult with and notify the relevant
trade unions regarding the Transaction;

15

 

	 	each Party undertaking to keep the other informed throughout on the status of
such consultations and notification.

	4.10	 	Draft Assumed Financial Liabilities Statement

	 	4.10.1	 	Prior to the date set for Closing, each of ST and NXP shall prepare
and deliver to the other
Party a draft statement, together with all related working papers,
setting out the
determination of, in respect of NXP’s Relevant Businesses, the NXP
Assumed Financial
Liabilities Funding Requirement and, in respect of ST’s Relevant
Businesses, the ST
Assumed Financial Liabilities Funding Requirement, as the case may be,
in respect thereof
(the “Draft Assumed Liabilities Statements”).
	 
	 	4.10.2	 	The Draft Assumed Financial Liabilities Statements shall be in the form set out
in Schedule 17 and shall be used to determine whether the
Assumed Financial Liabilities that will be
contributed by each Party at Closing are fully funded in accordance
with Clause 2.4.3 and whether, in relation to any NXP Entity or ST
Entity, as the case may be, there is any Cash to be deducted from the
amount of the Assumed Financial Liabilities. After Closing, the Draft
Assumed Financial Liabilities Statements will be reviewed and amended
to reflect the actual position as at Closing as laid down in the Final
Assumed Financial Liabilities Statements in accordance with Clause
6.8.

	4.11	 	Repayment of expenditure by the Company to NXP

	 	4.11.1	 	The Company undertakes to repay to NXP the part of the expenditure for
capital equipment actually received by the NXP Relevant Businesses, in
the period between the date hereof and Closing, consistent with the
Business Plan and Schedule 19 for which the costs are incurred
by NXP, as reasonably evidenced by NXP to ST and the Company in writing,
in accordance with and subject to the Clauses below (the “NXP interim
Capex”).
	 
	 	4.11.2	 	In respect of the three-month period starting immediately at the date
hereof NXP will be repaid up to an amount of USD 25,000,000 (twenty five
million US dollar) (the “NXP First Allocated Interim Capex”).
	 
	 	4.11.3	 	The expenditure for capital equipment actually received by the NXP
Relevant Businesses (i) in the period starting after this initial
three-month period and ending at the later of the date of satisfaction
of the Closing Conditions referred to in Clauses 3.1.1, 3.1.2, 3.1.3 and
3.1.7 and the date of obtaining the Dutch and Swiss tax rulings as
referred to in Clause 4.3.2(a) (the “NXP Second Allocated Interim
Capex”) and (ii) in the period starting at the later of the date of
satisfaction of the Closing Conditions referred to in Clauses
3.1.1,3.1.2, 3.1.3 and 3.1.7 and the date of obtaining the Dutch and
Swiss tax rulings as referred to in Clause 4.3.2(a) and ending on
Closing (the “NXP Third Allocated Interim Capex”) shall be allocated pro
rata temporis to these two periods.
	 
	 	4.11.4	 	The NXP Second Allocated Interim Capex as allocated pursuant to clause
4.11.3 will not be repaid. The NXP Third Allocated Interim Capex, as
allocated pursuant to Clause 4.11.3 shall be repaid up to an amount
calculated pro rata temporis to USD 25,000,000 (twenty five million US
dollar) per quarter, if and to the extent that Closing is delayed for
reasons
not due, or attributable to NXP (for the avoidance of doubt, any delay caused by

16

 

	 	 	 	implementing the WH2 Newco-structure by NXP prior to Closing shall be deemed due
and attributable to NXP).
	 
	 	4.11.5	 	Any repayment is subject to the assets acquired in connection with the capital
expenditure being part of the NXP Relevant Businesses.
	 
	 	4.11.6	 	If the later of the date of satisfaction of the Closing Conditions referred to in
Clauses 3.1.1, 3.1.2, 3.1.3 and 3.1.7 and the date of obtaining the Dutch and Swiss tax
rulings as referred to in Clause 4.3.2(a) occurs within the first three months, the
maximum amount to be repaid by Falcon shall not exceed an amount calculated pro rata
temporis to USD 25,000,000 (twenty five million US dollar) per three-month period.
	 
	 	4.11.7	 	Any payment under this Clause 4.11 will be made in cash immediately upon Closing for
that part of the capital expenditure that has been paid and for which evidence of the
payment of the relevant capital expenditure has been provided by NXP to ST or the
Company. For the part of the expenditure for capital equipment which has been received
but not yet paid at Closing, NXP shall either:

	 	(a)	 	transfer the relevant accounts payable to the Company; or
	 
	 	(b)	 	provide evidence of the payment of the relevant capital expenditure
at the due date, upon which the Company shall make such payment to NXP.

	4.12	 	T3G
	 
	 	 	Prior to Closing, NXP shall use its reasonable best efforts to acquire the shares in T3G
currently held by Datang Mobile Communications Equipment Co. Ltd, Samsung Electronics Co.
Ltd and Motorola Inc. (the “T3G Shares”). If Closing occurs, but NXP has not yet executed a
binding agreement to acquire the T3G Shares, NXP shall indemnify and hold the Company
harmless for the costs (including direct transaction costs) of acquiring these T3G Shares if
the Company acquires such T3G Shares after Closing.
	 
	4.13	 	Accounts
	 
	 	 	Within twenty five (25) Business Days after the date of this Agreement, each of NXP and ST
shall update the relevant Accounts with a list of assets and Inventory and procure its
auditors to deliver an audit comfort letter in relation thereto.
	 
	5	 	CLOSING
	 
	5.1	 	Effective Time
	 
	 	 	Without prejudice to the Warrantee’s rights arising from the R&Ws or each Party’s rights
arising otherwise from this Agreement, the Relevant Businesses are for the risk and the
account of the Company as of the Effective Time.
	 
	5.2	 	Date and place

	 	5.2.1	 	Subject to the satisfaction (or waiver under Clause 3.4) of each of the Closing
Conditions, Closing shall take place:

17

 

	 	(a)	 	at 11.00 CET on the first Business Day following the last calendar
day of the reporting month in which (a) notification occurs under Clause
3.4.1 in respect of that Closing Condition set out in 3.1.1 or 3.1.2 that
is last satisfied or, if later (b) waiver occurs under Clause 3.4 in
respect of any Closing Condition that has not been satisfied or waived; and
	 
	 	(b)	 	in Amsterdam, the Netherlands, at the offices of NXP’s Lawyers; or
	 
	 	(c)	 	at such other time, date and/or place as the Parties may agree
in writing (not acting unreasonably).

	 	5.2.2	 	Subject to Clauses 3 and 4, and without extending or amending any of the
obligations of the Parties thereunder, the Parties shall make their best efforts
to cause Closing to occur at or prior to 2 August 2008.

	5.3	 	Closing events
	 
	 	 	At Closing, each Party shall procure that the actions set out in Schedule 10
for which it is responsible, are taken in the sequence set out in said Schedule, to
the extent that any such action is not taken by NXP or ST, as the case may be and with
the prior written consent of the other, prior to the Closing.
	 
	5.4	 	Breach of pre-Closing and Closing obligations

	 	5.4.1	 	If any Party is in breach, and thereby a Defaulting Party, of any of its
material obligations under Clauses 3, 4 or 5, which breach is attributable to the
Defaulting Party and results in the Closing not occurring, the Defaulting Party
shall immediately owe and pay to the other Party an amount of USD 100,000,000 (one
hundred million US dollar). This amount is owed in addition and without prejudice
to all other rights or remedies available to such other Party, including the right
to claim damages, provided that if the damages awarded exceed the amount of USD
100,000,000 (one hundred million US dollar) actually paid to the non-Defaulting
Party, the Defaulting Party may set off such amount against any damages due and
payable pursuant to this Clause 5.4.1. Parties acknowledge that the other Party may
also request specific performance to effect Closing.
	 
	 	5.4.2	 	Concurrent with and without prejudice to Clause 5.4.1, if any Party breaches
any material obligation in Clause 5.3, ST, in the case of breach by NXP, or NXP, in
case of breach by ST, shall be entitled, (in addition to and without prejudice to
all other rights or remedies available, including the right to claim damages and
the right, if applicable to receive the penalty payment as set forth in Clause
5.4.1) to terminate, by notice, this Agreement (other than Clauses 1, 10 and 11.2
through 11.14), in which event the Parties shall forthwith take all such action as
is necessary to reverse any action already taken under Clause 5.3 and the
Disentanglement Plans.

	6	 	POST-CLOSING OBLIGATIONS
	 
	6.1	 	Completion of disentanglement
	 
	 	 	To the extent not taken prior to Closing, each Party, as soon as reasonably practicable after

18

 

	 	 	Closing but in any event prior to expiry of a period of three (3) months after
Closing, shall take, and procure the taking of such actions, as set out in its
Disentanglement Plan.

	6.2	 	Wrong pockets

	 	6.2.1	 	If, and to the extent applicable, any assets forming part of ST’s or NXP’s Relevant
Businesses have not been transferred by ST or NXP, as applicable, to the Company, the
relevant Party shall transfer these assets to the Company as soon as reasonably practicable
after Closing, at no additional costs.
	 
	 	6.2.2	 	If, and to the extent applicable, assets not forming part of ST’s or NXP’s Relevant
Businesses have been transferred by ST or NXP, as applicable, to the Company, the Company
shall transfer these assets to the relevant Party as soon as reasonably practicable after
Closing, at no additional costs.
	 
	 	6.2.3	 	Without detracting from the generality of Clause 6.2.2, if at any time after Closing,
any Group Company receives any monies in respect of any NXP Receivables or ST Receivables,
the Company shall procure that the relevant Group Company pays the amount received, less
reasonable administrative expenses, to NXP or ST, as the case may be, as soon as
reasonably practicable.

	6.3	 	Ancillary Agreements
	 
	 	 	Neither NXP nor ST shall claim from or pursue a claim against the Company or any of the
Company’s Affiliates under any Ancillary Agreement in the event that the fact or circumstance
giving rise to such claim is otherwise the subject of a claim under this Agreement for which
NXP or ST is liable. In the event of NXP or ST, as the case may be, being found liable under
this Agreement (excluding the Ancillary Agreements) after the claim has been satisfied under
the relevant Ancillary Agreement, NXP or ST, as the case may be, shall procure that the
Company or the relevant Group Company is reimbursed with the amount paid to the relevant
member of the NXP Group or the ST Group, as the case may be, by the Company or the relevant
Group Company in respect of the relevant claim under the relevant Ancillary Agreement. For
the avoidance of doubt, the exclusion of representations, warranties and indemnities set out
in the various Ancillary Agreements will be entirely without prejudice to the
representations, warranties and indemnities set out in this Agreement, unless otherwise
provided in this Agreement.
	 
	6.4	 	Release of Security

	 	6.4.1	 	Without detracting from any R&Ws, or indemnities, set out elsewhere in this
Agreement, each Party shall, to the extent not yet realized through the release referred
to in Clause 4.8, undertake, with effect from Closing or as soon as reasonably practicable
thereafter but in any event no later than three (3) months after the Closing, to perfect
all the formalities and execute any documents as may be reasonably necessary to effect the
release of all members of the Group from any (joint and/or several) Security given by,
assumed by or binding upon them in relation to any of the liabilities of such Party or any
of its Affiliates (excluding members of the Group), provided that such Party shall
indemnify, defend and hold harmless the Company and the other members of the Group against
all amounts paid by any of them or any costs, losses and liabilities (including without
limitation any loss of

19

 

	 	 	 	assets subject to Security) suffered by them after Closing pursuant to any such Security.
	 
	 	6.4.2	 	Without detracting from any R&Ws, or indemnities, set out elsewhere in this Agreement,
the Parties shall use their commercially reasonable best efforts to procure that the
Company or the relevant Group Company procures, with effect from Closing or as soon as
reasonably practicable thereafter but in any event no later than three (3) months after the
Closing, the release of each Party or its Affiliate (excluding members of the Group) from
any (joint and/or several) Security given by, assumed by or binding upon such Party or
Affiliate in relation to any liability included in any of the Relevant Businesses, provided
that the Company shall indemnify, defend and holds harmless the relevant Party or Affiliate
against all amounts paid by it or any costs, losses and liabilities (including without
limitation any loss of assets subject to Security) suffered by it after Closing pursuant to
any such Security.

	6.5	 	Final Assumed Financial Liabilities Statement

	 	6.5.1	 	Within forty (40) Business Days after the Closing Date, the Company shall prepare and
deliver to each of ST and NXP the Final Assumed Financial Liabilities Statement, in the
form set out in Schedule 17.
	 
	 	6.5.2	 	The Final Assumed Financial Liabilities Statement shall be used to determine whether
the Assumed Financial Liabilities contributed by each Party were fully funded when
contributed in accordance with Clause 2.4.3 and whether, in relation to any NXP Entity or
ST Entity, as the case may be, there is Cash to be deducted from the amount of the Assumed
Financial Liabilities.

	6.6	 	PPE and Inventory Statements

	 	6.6.1	 	Within forty (40) Business Days after the Closing Date, the Company shall prepare and
deliver to each of ST and NXP:

	 	(a)	 	a statement reflecting the value of the property, plant and equipment
(“PPE”) for each of the NXP Relevant Businesses and the ST Relevant Businesses, at
Closing (the “PPE Statements”); and
	 
	 	(b)	 	a statement reflecting the value of the Inventory for each of the NXP
Relevant Businesses and the ST Relevant Businesses at Closing (the “Inventory
Statements”).

	 	6.6.2	 	The PPE Statements and the Inventory Statements shall be calculated consistently with
the
same line items in the Accounts and shall be used to determine whether the value of the
PPE and Inventory contributed by each Party, at Closing, did not deviate substantially
from
the relevant reference amounts set out in Schedule 20 (the “Reference Amounts”).

	6.7	 	Review and determination

	 	6.7.1	 	In the event that either Party disagrees with the Final Assumed Financial Liabilities
Statement, it shall within twenty (20) Business Days after receipt thereof, deliver notice
of such disagreement to the other Party, with a copy to the Company, such notice (the
“Notice of Disagreement”) to specify (a) each item in the Final Assumed Financial

20

 

	 	 	 	Liabilities Statement with which it disagrees, (b) the amount of each adjustment
proposed by it and (c) in reasonable detail, the reason for its disagreement in respect of
each such
item.
	 
	 	6.7.2	 	In the event that either Party disagrees with a PPE Statement or an Inventory Statement, it
shall within twenty (20) Business Days after receipt thereof, deliver a Notice of Disagreement
to the other Party, with copy to the Company to specify (a) what item it disagrees with and
(b) in reasonable detail, the reason for its disagreement in respect thereof.
	 
	 	6.7.3	 	If no Party delivers a Notice of Disagreement in terms of Clauses 6.7.1 or 6.7.2, the Final
Assumed Financial Liabilities Statement, the PPE Statements or the Inventory Statements, as
the case may be, shall be final and binding on the Parties and the Company for all purposes.
	 
	 	6.7.4	 	If a Party delivers a Notice of Disagreement in terms of Clauses 6.7.1 or 6.7.2, then the
Parties shall attempt in good faith to reach agreement in respect of those items in the Final
Assumed Financial Liabilities Statement, the PPE Statements or the Inventory Statements, as
the case may be, in respect of which a Notice of Disagreement has been delivered, provided
that if the Parties do not reach such agreement within twenty (20) Business Days of delivery
of the Notice of Disagreement last delivered, either Party may by notice to the other Party
require that those items in the Final Assumed Financial Liabilities Statement, the PPE
Statements or the Inventory Statements, as the case may be, that have been properly specified
in a Notice of Disagreement in accordance with Clause 6.7.1 or Clause 6.7.2, as relevant, and
subsequently have not been agreed upon within the aforesaid twenty (20) Business Days, be
referred to the Reporting Accountant in the terms of Schedule 17 (Part 2).
	 
	 	6.7.5	 	In order to enable the preparation and determination of the Final Assumed Financial
Liabilities Statement, the PPE Statements and the Inventory Statement, the Company and each
Party shall procure the keeping up-to-date and, subject to reasonable notice, making
available to the Company’s and each Party’s representatives and advisors during normal office
hours of all books and records relating to any member of the Group, and co-operate with them
with regard to the preparation and determination of the Final Assumed Financial Liabilities
Statement, the PPE Statements and the Inventory Statements. The Company and each Party shall,
in so far as it is reasonable to do so, make available the services of its and its
Affiliates’ employees to assist the Company and each Party in the performance of its
obligations and exercise by a Party of its rights under this Clause 6.7.

	6.8	 	Adjustment and payment for the Final Assumed Financial Liabilities Statement

	 	6.8.1	 	Following determination of the Final Assumed Financial Liabilities Statement in accordance
with Clause 6.7, the Company shall determine the differences between the Draft Assumed
Financial Liabilities Statements and the Final Assumed Financial Liabilities Statement and
hence the amount of the Assumed Financial Liabilities Funding Requirement of each Party;

	 	(a)	 	if the Assumed Financial Liabilities Funding Requirement is a positive
amount, the relevant Party shall pay to the Company in cash an amount equal to this
positive

21

 

	 	 	 	amount;
	 
	 	(b)	 	if the Assumed Financial Liabilities Funding Requirement is a
negative amount, the Company shall pay to the relevant Party in cash an amount
equal to this negative amount.

	 	6.8.2	 	Any payment to be made in accordance with this Clause 6.8 shall include interest
thereon calculated from the day after the Effective Time to the day of payment, both days
inclusive, at the Interest Rate.
	 
	 	6.8.3	 	The due date for any payment to be made under this Clause 6.8, shall be the fifth
(5th) Business Day after the Final Assumed Financial Liabilities Statement has been
finally determined in accordance with Clause 6.7.

	6.9	 	Adjustment and payment for the PPE Statements and the Inventory Statements

	 	6.9.1	 	Following determination of the PPE Statements in accordance with Clause 6.7, the
Company shall determine the differences between the relevant Reference Amounts and the
value of the PPE as this is reflected in the respective PPE Statements.
	 
	 	6.9.2	 	If the value of the PPE as reflected in a Party’s PPE Statement is more than 10%
(ten per cent) lower than the relevant Reference Amount, that Party shall pay to the
other Party in cash an amount equal to the shortfall below 90% (ninety per cent) of the
relevant Reference Amount. For the avoidance of doubt, there shall only be a payment in
relation to a PPE Statement in the situation as set forth in this Clause 6.9.2.
	 
	 	6.9.3	 	Following determination of the Inventory Statements in accordance with Clause 6.7,
the Company shall determine the differences between the relevant Reference Amounts and
the value of the Inventory as this is reflected in the respective Inventory Statements.
	 
	 	6.9.4	 	If the value of the Inventory as reflected in a Party’s Inventory Statement is
lower than the relevant Reference Amount that Party shall pay to the other Party in cash
an amount equal to the difference in value between the Inventory as reflected in the
Inventory Statement and the relevant Reference Amount. For the avoidance of doubt, there
shall only be a payment in relation to an Inventory Statement in the situation as set
forth in this Clause 6.9.4.
	 
	 	6.9.5	 	Any payment to be made in accordance with this Clause 6.9 shall include interest
thereon calculated from the day after the Effective Time to the day of payment, both days
inclusive, at the Interest Rate.
	 
	 	6.9.6	 	The due date for any payment to be made under this Clause 6.9, shall be the fifth
(5th) Business Day after the PPE Statements and the Inventory Statements have been
finally determined in accordance with Clause 6.7.

	6.10	 	Reciprocal release of liabilities; indemnity against certain liabilities

	 	6.10.1	 	As of Closing:

	 	(a)	 	subject to any other indemnities included in this Agreement,
excluding Clause 6.10.1(b) and Clause 6.10.2, (i) NXP shall indemnify, defend and
hold harmless the Company and the other members of the Group against all NXP
Retained Liabilities, and (ii) ST shall indemnify, defend and hold harmless the
Company and the other

22

 

	 	 	 	members of the Group against all ST Retained Liabilities; and
	 
	 	(b)	 	subject to any other indemnities included in this Agreement and upon final
determination of the Assumed Financial Liabilities Funding Requirement in
accordance with Clause 6.8 and the satisfaction thereof, the Company shall
indemnify, defend and hold harmless each Party and its Affiliates against all
Assumed Liabilities.

	 	6.10.2	 	AS of Closing:

	 	(a)	 	the Company and each relevant Group Company shall be released and discharged (i)
by NXP and each member of the NXP Group from all the NXP Retained Liabilities,
and (ii) by ST and each member of the ST Group from all ST Retained Liabilities;
and
	 
	 	(b)	 	NXP and each member of the NXP Group or ST and each member of the ST Group, as
the case may be, shall be released and discharged by the Company or the relevant
Group Company from any and all Assumed Financial Liabilities, provided that the
Assumed Financial Liabilities Funding Requirement as determined in accordance
with Clause 6.8 has been satisfied.

	 	6.10.3	 	For the avoidance of doubt, the liabilities of each of the Parties under this Clause
6.10 are not limited in time or amount and shall continue to apply upon termination of
the Shareholders Agreement.

	6.11	 	R&D Tax Credits

	 	6.11.1	 	Subject to Clause 6.11.2, NXP guarantees to ST and the Company that the amounts of the
R&D Tax Credits will be received by NXP France, or such other relevant Group Company, as
the case may be, ultimately within twenty (20) Business Days after the last day of the
month set for those payments, in accordance with the table set out below.

	 	 	 	 	 
	Origin of the R&D Tax Credit	 	Amount	 	Date of refund
	 

	 	NXP CroIIes	 	 
	December 2005

	 	€5.498.435
	 	June 2009
	December 2006

	 	€10.000.000
	 	June 2010
	December 2007

	 	€3.660.000
	 	June 2011
	 

	 	NXP France	 	 
	December 2006

	 	€1.894.931
	 	June 2010
	December 2007

	 	€6.990.500
	 	June 2011
	 

	 	NXP Rennes	 	 
	December 2005

	 	€1.492.872
	 	June 2009
	December 2006

	 	€365.693
	 	June 2010
	December 2007

	 	€133.000
	 	June 2011

	 	6.11.2	 	The guarantee by NXP, as set out in Clause 6.11.1, shall not apply if ST and/or
the Company or any of its Affiliates, as applicable, takes any action or refrains
from taking any action that adversely affects receipt of the R&D Tax Credits in
the amounts and ultimately

23

 

	 	 	 	by the dates, as set out in the table in Clause 6.11.1.
	 
	 	6.11.3	 	If after Closing the Company receives an amount relating to the June 2008 Refunds, then
the Company shall pay to NXP the actual amount of these June 2008 Refunds received within
thirty (30) Business Days of receipt.
	 
	 	6.11.4	 	If an amount of the R&D Tax Credits as referred to in Clause 6.11.1 has not been fully
received by any Group Company ultimately twenty (20) Business Days after the last day of
the month set for those payments, NXP undertakes to pay within ten (10) Business Days of
the relevant Group Company’s notice thereof to NXP, to the relevant Group Company as
referred to in this notice, (i) if any amount is received, the difference between the
amount of the relevant R&D Tax Credit received and the amount of the relevant R&D Tax
Credit as referred to in Clause 6.11.1 or (ii) if no amount has been received, the full
amount of the relevant R&D Tax Credit as referred to in Clause 6.11.1. If after receipt of
the relevant amount from NXP by the relevant Group Company, any amount of the relevant R&D
Tax Credit to which such payment by NXP is related, is received from the relevant
Governmental Authority, the relevant Group Company shall repay such amount received from
the relevant Governmental Authority to NXP.

	6.12	 	Obligation to obtain Third Party Consents

	 	6.12.1	 	It is acknowledged that, in effecting the Disentanglement, the transfer, pursuant to
this Agreement, of Contracts may be subject to Third Party Consents. NXP shall request ST
to give its prior approval prior to soliciting the Third Party Consents of certain
material Contracts. Insofar as a Third Party Consent has not been obtained in relation to
a Contract, other than a Project Contract, prior to Closing, except as otherwise mutually
agreed between the Parties, the Parties shall use their reasonable best efforts to obtain
such Third Party Consent as soon as practicable after the Closing Date.
	 
	 	6.12.2	 	In connection with the obtaining of any Third Party Consent referred to in paragraph
6.12.1, each Party shall supply to the other Party such information and references (under
appropriate non-disclosure arrangements) regarding it as may be reasonably requested by
the other Party or any relevant third party for the purpose of obtaining Third Party
Consents and shall enter into such undertakings or procure such guarantees in favour of
any relevant third party as may be reasonably requested in respect of the relevant
Contracts.
	 
	 	6.12.3	 	In respect of any Contract other than a Project Contract, from the Closing Date until
the relevant Third Party Consent has been obtained as contemplated by Clause 6.12.1 or in
the event the Third Party Consent has been refused:

	 	(a)	 	to the extent permitted under the relevant Contract, the Parties shall
make such other arrangements between themselves to provide to the Company or the
relevant Group Company the full benefits of the Contract, including the enforcement
at the cost and for the account of the Company or the relevant Group Company of all
rights of NXP or ST, as the case may be, against any other party thereto;
	 
	 	(b)	 	to the extent that the Company or the relevant Group Company is
lawfully and practically able to do so, and to the extent that the Company or the
relevant Group

24

 

	 	 	 	Company is receiving the full benefits of the Contract, the Company or the
relevant Group Company shall perform the obligations of the NXP Group or ST Group,
as the case may be, under the Contract as agent or sub-contractor and shall
indemnify the NXP Group or the ST Group, as the case may be, in respect thereof;
	 
	 	(c)	 	to the extent that the Company or the relevant Group Company is not
lawfully or practically able to perform the obligations of the NXP Group or ST Group,
as the case may be, under the Contract as agent or sub-contractor, the NXP Group or
ST Group, as the case may be, shall do all such things as the Company or the relevant
Group Company may reasonably require to enable due performance of the Contract and
the Company or the relevant Group Company shall indemnify the NXP Group or ST Group,
as the case may be, in respect thereof.

	6.13	 	Retention of records

	 	6.13.1	 	ST and NXP shall retain for a period of five (5) years from Closing, or such longer period
as may be prescribed by applicable Law, all books, records and other written information
relating to ST’s or NXP’s Relevant Businesses, as applicable, which are not delivered to, or
in the possession or under the control of, the Company or another Group Company at or
immediately after Closing and are held by or on behalf of any member of the ST Group or the
NXP Group, as applicable, pursuant to Closing and, to the extent reasonably required by the
other Party or the Company, shall allow the other Party or the Company, upon reasonable
notice, access during normal office hours to such books, records and other information,
including the right to inspect and take copies (at the expense of the other Party or the
Company, as applicable) to the extent relating to the Relevant Businesses.
	 
	 	6.13.2	 	The Company shall retain for a period of five (5) years from Closing, or such longer
period as may be prescribed by applicable Law, any books, records or other written
information relating to the Business which are delivered to, or in the possession or under
the control of, the Company or another Group Company at or immediately after Closing and, to
the extent reasonably required by ST or NXP, the Company shall allow ST or NXP, upon
reasonable notice, access during normal office hours to such books, records and information,
including the right to inspect and take copies (at the expense of ST or NXP, as applicable).
	 
	 	6.13.3	 	Within 30 (thirty) Business Days after Closing, NXP shall provide the necessary financial
information to ST and the Company in order to enable ST to prepare an opening balance sheet
of the Group as per Closing, in accordance with the ST Accounting Principles.

	6.14	 	Insurance

	 	6.14.1	 	Termination of coverage
	 
	 	 	 	As of the date set for Closing, all coverage with respect to NXP’s Relevant Businesses
under any insurance policies of any member of the NXP Group (the “Insurance Policies”) in
respect of events, occurrences or accidents occurring on or after the Closing Date shall
be cancelled and terminated, excluding those Insurance Policies in respect of which the
sole policy holders or named insured are part of NXP’s Relevant Businesses.

25

 

	 	6.14.2	 	Indemnity

Except for claims referred to in Paragraph 17.1 of Schedule 14, for all claims
made on or after Closing and arising in respect of an event, occurrence or accident
occurring on or after Closing, there shall be no right to recover any amounts in respect
thereof from NXP or any other member of the NXP Group, or any of its insurers, and the
Company shall be responsible for and shall indemnify, defend and hold harmless NXP and the
relevant other members of the NXP Group from all Losses incurred by NXP or any other
member of the NXP Group, or its insurers, in respect of any such claim or attempted claim
by any Group Company or third party.

	6.15	 	Earn-out Obligations

Notwithstanding the provisions of Clause 6.10, the Company shall, and shall procure that the
relevant Group Companies, meet all the Earn-Out Obligations assumed by the relevant Group
Company in respect of the Earn-Out Payments.

	7	 	WARRANTIES AND LIABILITY

	7.1	 	Warranties

	 	7.1.1	 	Subject to the remaining provisions of this Clause 7 and to Clauses 8 and 9, each Party
(the “Warrantor”) represents and warrants to the other Party (the “Warrantee”, being ST,
where NXP is the Warrantor, and NXP, where ST is the Warrantor) that the statements set out
in Schedule 14 (the “R&Ws”, and each a “R&W”) are true and accurate as at Signing.
	 
	 	7.1.2	 	The Warrantee acknowledges and agrees that the Warrantor makes no representation or
warranty as to the accuracy of any forecasts, estimates, projections, statements of intent or
statements of opinion howsoever provided to the Warrantee or any of its representatives or
advisors at or prior to Signing. The Warrantee acknowledges that no representations or
warranties, express or implied, have been given or are given other than the Warrantor’s R&Ws.
	 
	 	7.1.3	 	Any R&W qualified by the expression “so far as the Warrantor is aware” or any similar
expression shall be deemed to refer to the knowledge of Carlo Bozotti, Aldo Romano, Tommi
Uhari, Carlo Ferro, Pierre Ollivier, Patrice Chastagner and Lisa Jorgenson, where ST is the
Warrantor and the knowledge of Frans van Houten, Theo Claasen, Peter van Bommel, Guido
Dierick, Peter Kleij, Steven McCann and Marc Cetto where NXP is the Warrantor, each of whom
shall be deemed to have knowledge of such matters as they would have discovered, had they
made reasonable enquiries within the Warrantor’s Relevant Businesses.
	 
	 	7.1.4	 	The applicability of title 1 of Book 7 of the Netherlands Civil Code is hereby excluded.
	 
	 	7.1.5	 	For the avoidance of doubt, a Warrantor’s R&Ws are given only in respect of its Relevant
Businesses (and not in respect of the Warrantee’s Relevant Businesses).

26

 

	7.2	 	Disclosure

The R&Ws are subject to, and the Warrantor shall not be liable for breach of any of
the R&Ws, in relation to any matter or fact which is Disclosed. Each Warrantor
shall have the right and the obligation to update the ST Disclosure Letter or the
NXP Disclosure Letter, as the case may be, for matters not having a Material
Adverse Effect prior to Closing for those R&Ws that are only given at Signing in
Schedule 14 and are being repeated at Closing pursuant to Clause 7.3.1

	7.3	 	Updating of R&Ws at Closing

	 	7.3.1	 	Subject to Clause 7.3.2, the Warrantor further represents and warrants to
the Warrantee that the R&Ws will also be true and accurate at Closing, as if
they had been repeated at Closing, provided that (i) all such R&Ws that pertain
to or are made with respect to any companies not yet incorporated at the date
hereof, are made as at Closing and not as of the date hereof and (ii) any R&W’s
given at Signing in Schedule 14 shall be read for the purpose of this
Clause 7.3.1 without the words “at Signing”.
	 
	 	7.3.2	 	No right to reimbursement of Losses shall arise in favour of the Warrantee
under Clause 7.3.1 in consequence of an event or matter which results in any of
the R&Ws being untrue or inaccurate at the Closing if the event or matter could
not reasonably have been avoided or prevented by the Warrantor, or any of its
directors, officers, or employees.

	7.4	 	Liability for breach

	 	7.4.1	 	Subject to Clauses 3.5 and 5.4.2, in the event of any breach by a Party
under this Agreement, the other Party shall not have the right to terminate or
rescind this Agreement and as its sole and exclusive remedy and subject to any
other limitations of liability set out in this Agreement, shall have the right,
after Closing, to claim the Losses suffered or incurred by it as a result of
such breach.
	 
	 	7.4.2	 	For purposes of this Agreement, it is agreed that a breach of a R&W shall
occur where same is untrue or inaccurate as at any date on which the same is
given.

	7.5	 	Losses suffered by the Business

	 	7.5.1	 	Subject to Clause 7.5.2, Parties agree that Losses suffered or incurred by
the Company or any other member of the Group in connection with a breach of a
R&W, shall be deemed to be Losses suffered or incurred by the Warrantee.
	 
	 	7.5.2	 	Subject to the limitations of liability as set forth in Clause 8, if Losses
are suffered or incurred at the level of the Group, as set forth in Clause 7.5.1
(a) the amount of the Losses that the Warrantee shall have the right to claim
shall be limited to the Warrantee’s proportionate share of such Losses,
calculated on the basis of the Warrantee’s shareholding in the Company at the
time of giving notice of the claim (as set forth in Clause 9.2) and (b) at the
election of the Warrantee, the Warrantor shall pay the full amount of those
Losses directly to the Company.

27

 

	8	 	LIMITATION OF LIABILITY

	8.1	 	Time limitation

A Party (the “Defaulting Party”) shall not be liable in respect of any claim under the R&Ws
or the Tax Indemnity unless a notice of the claim is given by to the other Party (the
“non-Defaulting Party”), specifying the matters set out in Clause 9.2:

	 	8.1.1	 	in the case of any claim under the Tax Indemnity, within thirty (30) days after
expiry of the statutory limitation period applicable in the relevant jurisdiction for the
Tax matter giving rise to such claims and any applicable term during which additional
assessments can be levied under the relevant applicable Law;
	 
	 	8.1.2	 	in the case of any claim under Paragraph 14 of Schedule 14 (environmental
warranties), within three (3) years after the Closing; and
	 
	 	8.1.3	 	in the case of any other claim, within eighteen (18) months after the Closing;

provided that the statutory limitation period applicable in the relevant jurisdiction shall
apply for giving notice of any claim under Paragraphs 1.1, 2 and 3 of Schedule 14
(Incorporation, authority, corporate action).

	8.2	 	Minimum claims

Subject to any other limitations set out in this Agreement, the Defaulting Party shall only
be liable under the R&Ws in respect of any individual claim, or a series of claims arising
from identical facts, to the extent that the liability agreed or determined in respect of
any such claim or series of claims exceeds an amount of USD 500,000 (five hundred thousand
US dollar). In relation to paragraph 17.1 of Schedule 14 (claims third parties) this
clause 8.2 shall apply with the amount set out in the preceding sentence being USD 2,500,000
(two million five hundred thousand US dollar).

	8.3	 	Aggregate minimum claims

Subject to any other limitations set out in this Agreement, the Defaulting Party shall only
be liable under the R&Ws in respect of any claim if the aggregate amount of all claims for
which it would otherwise be liable under this Agreement, exceeds USD 10,000,000 (ten million
US dollar), in which case the Defaulting Party shall be liable for the full amount and not
just the excess. Any liability of the Defaulting Party under this Agreement in relation to
paragraph 17.1 of Schedule 14 (claims third parties) shall not be subject to, and
also (in relation to any liability for other claims under the R&Ws) not count towards, the
amount of USD 10,000,000 (ten million US dollar) referred to in the preceding sentence.

	8.4	 	Maximum liability

As from Closing, save for any claims under Paragraph 14 of Schedule 14 (environmental
warranties), Paragraph 10 of Schedule 14 (IP warranties), Paragraph 7.1 of
Schedule 14 (to the extent relating to IP warranties) and Paragraph 11 of
Schedule 14 (to the extent relating to pension warranties), the aggregate liability
of the Defaulting Party in respect of all claims under the R&Ws shall not exceed an amount of
USD 250,000,000 (two hundred and fifty million US

28

 

dollar).

	8.5	 	Provisions

The Defaulting Party shall not be liable under this Agreement in respect of any
claim if and to the extent that any allowance, provision or reserve is made in the
relevant Accounts (and not released prior to the Closing), or in the relevant Final
Assumed Financial Liabilities Statement, for the matter giving rise to the claim.

	8.6	 	Matters arising after Signing / Closing

Subject to Clauses 3.1.6, 7.2 and 7.3.1, the Defaulting Party shall not be liable
under this Agreement in respect of any matter, act, omission or circumstance (or
any combination thereof), including the aggravation of a matter or circumstance, to
the extent that the same would not have occurred but for:

	 	8.6.1	 	any matter or thing done or omitted to be done pursuant to and in
compliance with this Agreement or otherwise at the request or with the approval
of the non-Defaulting Party;
	 
	 	8.6.2	 	any act, omission or transaction of the non-Defaulting Party, or the
non-Defaulting Party’s respective directors, officers, employees or agents or
successors in title, after Signing;
	 
	 	8.6.3	 	the passing of, or any change in, any Law or administrative practice of any
Governmental Authority after Signing, including any increase in the rates of Tax
or any imposition of Tax or any withdrawal of relief from Tax not actually in
effect at Signing;
	 
	 	8.6.4	 	any change after Signing of any generally accepted interpretation or
application of any Law; or
	 
	 	8.6.5	 	any change in any accounting or Tax policy, basis or practice of NXP or ST,
as applicable, introduced or having effect after Signing.

	8.7	 	Insurance

The Defaulting Party shall not be liable in respect of any claims made by the
non-Defaulting Party to the extent that the Losses in respect of which a claim is
made are covered by a policy of insurance in force immediately prior to the Closing
and insofar as the Company has a right of recovery.

	8.8	 	Net financial benefit

The Defaulting Party shall not be liable under this Agreement in respect of any
claims to the extent of any corresponding savings actually made by the
non-Defaulting Party arising in respect of such Losses or the facts giving rise to
such Losses (for example, without limitation, where the amount (if any) by which
any Tax for which would otherwise have been accountable or liable to be assessed is
actually or will actually be reduced or extinguished as a result of the matter
giving rise to such liability).

	8.9	 	Mitigation of Losses

The non-Defaulting Party shall use all reasonable efforts to procure that all
reasonable steps are taken and all reasonable assistance is given to avoid or
mitigate any Losses which in the absence of mitigation might give rise to a
liability in respect of any claim under this Agreement.

29

 

	8.10	 	Non-Defaulting Party’s right to recover

	 	8.10.1	 	The Warrantor shall not be liable in respect of any Losses relating to any actual
liability unless and until such actual liability is due and payable, or any Losses
relating to any liability which is contingent unless and until such contingent liability
becomes an actual liability and is due and payable, provided that this Clause 8.10.1 shall
not operate to exclude liability in relation to a claim made in respect of an actual or
contingent liability within the relevant time limit specified in Clause 8.1 and specifying
the matters set out in Clause 9.2.
	 
	 	8.10.2	 	If the Warrantor has paid an amount in discharge of any claim under this Agreement and
any member of the Warrantee’s Group subsequently recovers (whether by payment, discount,
credit, relief, insurance or otherwise) from a third party a sum which indemnifies or
compensates any member of the Warrantee’s Group (in whole or in part) in respect of the
Loss which is the subject matter of the claim, then the Warrantee shall procure that the
relevant member of the Warrantee’s Group forthwith pays to the Warrantor the full amount
recovered, less any costs and expenses reasonably incurred in obtaining such recovery and
limited to the amount actually paid by the Warrantor in respect of the claim.

	8.11	 	Double claims

The non-Defaulting Party shall not be entitled to recover from the Defaulting Party under
this Agreement more than once in respect of the same Losses suffered. Subject to any other
limitations set out in this Agreement, in the event that any matter, act, omission or
circumstance (or any combination thereof) giving rise to a breach of a R&W is the subject of
an indemnity under this Agreement, the non-Defaulting Party’s claim shall be limited to a
claim under said indemnity.

	8.12	 	Non-applicability to certain claims

Notwithstanding the foregoing provisions of this Clause 8:

	 	8.12.1	 	the provisions of this Clause 8, save for Clauses 8.1.1, 8.5 and 8.7 through 8.11, shall
not apply to any claims made under the Tax Indemnity.
	 
	 	8.12.2	 	the provisions of this Clause 8, save for Clauses 8.8 through 8.11, shall not apply to
any claims made under Paragraph 1 (Incorporation; existence; solvency), 2 (Authority) or
3 (Corporate action) of Schedule 14;
	 
	 	8.12.3	 	the provisions of this Clause 8, save for Clauses 8.8 through 8.11, shall not apply to
any claims made under the indemnities included in Clause 6.10 and Clause 6.11.1,
Paragraph 6.4 of Schedule 3 (Calamba environmental indemnity), Paragraphs 3 and 4
of Schedule 7 (employment indemnities) and Paragraph 1.14 of Schedule 8
(pension indemnity).

	9	 	CLAIMS

	9.1	 	Notification of potential claims

If the Warrantee becomes aware of any matter or circumstance that may give rise to a claim

30

 

against the Warrantor, under the R&Ws, the Warrantee, shall within forty (40) Business
Days deliver a notice to Warrantor setting out such information as is available to it as is
reasonably necessary to enable the Warrantor to assess the merits of the claim, to act to
preserve evidence and to make such provision as the Warrantor may consider necessary,
provided that failure to give such notification within the aforesaid forty (40) Business Days
shall not affect Warrantee’s right to make the claim except to the extent Warrantor shall
have been or will be actually prejudiced as a result of such failure.

	9.2	 	Notification of claims

Without detracting from Clause 9.1, notices of claims under the R&Ws shall be given by the
Warrantee to the Warrantor within the time limits specified in Clause 8.1, specifying full
information of the legal and factual basis of the claim and the evidence on which the
Warrantee relies and, if practicable, an estimate of the amount of Losses which are, or are
to be, the subject of the claim (including any Losses which are contingent on the occurrence
of any future event).

	9.3	 	Commencement of proceedings

Without detracting from Clause 9.2, any claim notified to the Warrantor shall (if it has not
been previously satisfied, settled or withdrawn) be deemed to be irrevocably withdrawn six
(6) months after the notice is given pursuant to Clause 9.2 or, in the case of any
contingent liability, six (6) months after such contingent liability becomes an actual
liability and is due and payable unless legal proceedings in respect of it (i) have been
formally commenced and (ii) are being and continue to be pursued with reasonable diligence.

	9.4	 	Investigation by the Warrantor

In connection with any matter or circumstance notified by the Warrantee pursuant to Clause
9.1 or 9.2:

	 	9.4.1	 	the Warrantee shall allow the Warrantor and its financial, accounting, legal and
other advisors to investigate the matter or circumstance alleged to give rise to such
claim and whether and to what extent any amount is or may be payable in respect of such
claim; and
	 
	 	9.4.2	 	the Warrantee shall disclose to the Warrantor all information of which it is aware
which relates to the claim and shall give, subject to being paid reasonable costs and
expenses, all such information and assistance, including access to premises and
personnel, and the right to examine and copy or photograph any assets, accounts,
documents and records, in each case as the Warrantor or its financial, accounting, legal
or other advisors may reasonably request.

	9.5	 	Procedure for third party claims

	 	9.5.1	 	If the claim notified to the Warrantor is a result of or in connection with a claim
by or liability to a third party then:

	 	(a)	 	no admissions in relation to such third party claim shall be made by
or on behalf of the Warrantee and the claim shall not be compromised, disposed of
or settled without the prior written consent of the Warrantor;
	 
	 	(b)	 	the Warrantor shall be entitled at its own expense, by notice to the Company and the

31

 

Warrantee, and the Company and the Warrantee shall duly and fully co-operate to allow
the Warrantor, to take such action as it deems necessary to avoid, dispute, deny,
defend, resist, appeal, compromise or contest such claim or liability (including
making counterclaims or other claims against third parties) in the name of and on
behalf of the Warrantee, the Company or its relevant Affiliate, as the case may be,
and to control the conduct of any related proceedings, negotiations or appeals; and

	 	(c)	 	where the Warrantor has issued a notice pursuant to Clause (b), the
Warrantee and the Company shall give, and shall procure that their Affiliates give,
subject to being paid reasonable costs and expenses, all such information and
assistance including access to premises and personnel, and the right to examine and
copy or photograph any assets, accounts, documents and records, as the Warrantor may
reasonably request for the purpose referred to in Clause (b), including instructing
such professional or legal advisors as the Warrantor may nominate to act on behalf
of the Warrantee and the Company, but in accordance with the Warrantor’s
instructions, it being agreed that the Warrantor shall keep the Warrantee and the
Company informed of all relevant matters relating to the claim and shall forward or
procure to be forwarded to the Warrantee and the Company copies of all material
external correspondence (other than such correspondence as is subject to legal
professional privilege of the Warrantor) relating to the claim.

	 	9.5.2	 	If the Company or the Warrantor, as the case may be, conducts the defence of a claim,
the Company or the Warrantor, as the case may be, shall conduct the defence to the best of
its abilities, taking into account not only its own interests but also the Warrantor’s and
Warrantee’s or the Company’s interest, as the case may be.

	10	 	CONFIDENTIALITY

	10.1	 	Announcements

No announcement or circular in connection with the existence or the subject matter of this
Agreement shall be made or issued by or on behalf of ST or NXP without the prior written
approval of ST and NXP. This shall not affect any announcement or circular required by Law or
the rules of any recognised stock exchange on which the shares of either Party are listed,
provided that the Party with an obligation to make an announcement or issue a circular shall
consult with the other Party insofar as is reasonably practicable before complying with such
an obligation.

	10.2	 	Confidentiality undertaking

	 	10.2.1	 	The Confidentiality Agreement shall cease to have any force or effect from Closing.
	 
	 	10.2.2	 	Subject to Clause 10.1 and Clause 10.2.3, each of the Parties shall treat as strictly
confidential and not disclose or use any information contained in or received or obtained
as a result of entering into this Agreement (or any agreement entered into pursuant to
this Agreement) which relates to:

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	 	(a)	 	the provisions of this Agreement or any agreement entered into
pursuant to this Agreement;
	 
	 	(b)	 	the negotiations relating to this Agreement (or any such other agreement); or
	 
	 	(c)	 	a Party to this Agreement or the business carried on by it or any
member of its group of companies.

	 	10.2.3	 	Clause 10.2.2 shall not prohibit disclosure or use of any information if and to the
extent:

	 	(a)	 	the disclosure or use is required by Law or any recognised stock
exchange on which the shares of any Party are listed;
	 
	 	(b)	 	the disclosure or use is required to vest the full benefit of this
Agreement in any Party;
	 
	 	(c)	 	the disclosure or use is required for the purpose of any judicial
proceedings arising out of this Agreement or any other agreement entered into
under or pursuant to this Agreement or the disclosure is made to a Tax
Authority in connection with the Tax affairs of the disclosing Party;
	 
	 	(d)	 	the disclosure is made to professional advisors of any Party on
terms that such professional advisors undertake to comply with the provisions
of Clause 10.2.2 in respect of such information as if they were a party to
this Agreement;
	 
	 	(e)	 	the information is or becomes publicly available (other than by
breach of the Confidentiality Agreement or of this Agreement);
	 
	 	(f)	 	the other Party has given prior written approval to the disclosure or use; or
	 
	 	(g)	 	the information is independently developed after Closing;

provided that prior to disclosure or use of any information pursuant to Clause
10.2.3(a), (b), or (c), the Party concerned shall promptly notify the other Party
of such requirement with a view to providing the other Party with the opportunity
to contest such disclosure or use or otherwise to agree the timing and content of
such disclosure or use.

	11	 	MISCELLANEOUS

	11.1	 	Further assurances

Each of the Parties shall from time to time execute such documents and perform such
acts and things as the other Party may reasonably require to transfer their Relevant
Businesses to the Joint Venture, and to give any Party the full benefit of this
Agreement.

	11.2	 	Whole agreement

	 	11.2.1	 	This Agreement, together with the Transaction Documents, contains the whole agreement
between the Parties relating to the subject matter of this Agreement, to the exclusion of any
terms implied by Law which may be excluded by contract, and supersedes any previous
written or oral agreement between the Parties in relation to the matters dealt with in this
Agreement. 

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	 	11.2.2	 	ST acknowledges that it has not been induced to enter into this
Agreement by any representation, warranty or undertaking not expressly set out
in this Agreement.
	 
	 	11.2.3	 	NXP acknowledges that it has not been induced to enter into this Agreement by
any representation, warranty or undertaking not expressly set out in this
Agreement.

	11.3	 	Assignment

Any Party may assign, grant any security interest over or otherwise transfer, in
whole or in part, any of its rights and obligations under this Agreement, provided
that such assignment, granting or transfer takes place to a party that becomes a
shareholder of the Company in accordance with the provisions of the Shareholders
Agreement. Any other assignment, granting of security interest over or other
transfer shall require the prior written consent of the other Party.

	11.4	 	Waiver

No waiver of any provision of this Agreement shall be effective unless in writing
and signed by or on behalf of the waiving Party.

	11.5	 	Variation

No variation of this Agreement shall be effective unless in writing and signed by
or on behalf of each of the Parties.

	11.6	 	Third party rights

This Agreement does not contain a stipulation in favour of a third party
(‘derdenbeding’), except for the Company and the relevant Group Companies in
relation to all provisions of this Agreement pursuant to which the Company and/or
the Group Companies are granted certain rights or are the recipient of certain
guarantees, covenants or undertakings and for the relevant members of the NXP Group
in relation to Clause 6.10 and Clause 6.14.

	11.7	 	Rescission

Without prejudice to Clauses 3.5 and 5.4.2, each Party waives its right to rescind
(‘ontbinden’) this Agreement on the basis of section 6:265 of the Netherlands Civil
Code. The mistaken party shall bear the risk of any mistake (‘dwaling’) in making
this Agreement.

	11.8	 	Costs

Unless this Agreement provides otherwise, all costs which a Party has incurred or
must incur in preparing, concluding or performing this Agreement, including the
relevant Transaction Costs and Disentanglement Costs, are for its own account. The
Start-Up Costs shall be borne by either the Company or by ST and NXP pro rata to
their shareholdings in the Company. For the avoidance of doubt, all Restructuring
Costs shall be for the account of the Company, unless provided otherwise in this
Agreement. NXP will bear all the WH2 Reorganisation Costs.

	11.9	 	Interest

If any Party defaults in the payment when due of any sum payable under this
Agreement, the liability of that Party shall be increased to include interest on
such sum from the date when such payment is due until the date of actual payment
(as well after as before judgement) at the Interest

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Rate.

	11.10	 	Notices

	 	11.10.1	 	Any notice in connection with this Agreement (a “Notice”) shall be:

	 	(a)	 	in writing;
	 
	 	(b)	 	in English; and
	 
	 	(c)	 	delivered by hand, fax, registered post or by courier using an
internationally recognised courier company.

	 	11.10.2	 	A Notice to ST shall be sent to ST at the following address, or such other
person or
	 
	 	 	 	address as ST may notify to NXP from time to time:
	 
	 	 	 	ST N.V.
	 
	 	 	 	39 Chemin de Champ des Filles
	 
	 	 	 	1228 Plan les Ouates, Geneva
	 
	 	 	 	Switzerland
	 
	 	 	 	Fax: +41 22 929 5906
	 
	 	 	 	Attention: General Counsel
	 
	 	11.10.3	 	A Notice to NXP shall be sent to NXP at the following address, or such other
person or address as NXP may notify to ST from time to time:
	 
	 	 	 	NXP B.V.
	 
	 	 	 	High Tech Campus 60
	 
	 	 	 	5656 AG Eindhoven
	 
	 	 	 	The Netherlands
	 
	 	 	 	Fax: + 31 40 272 9658
	 
	 	 	 	Attention: General Counsel
	 
	 	11.10.4	 	A Notice shall be effective upon receipt and shall be deemed to have been received:

	 	(a)	 	at the time of delivery, if delivered by hand, registered post or courier;
	 
	 	(b)	 	at the time of transmission in legible form, if delivered by fax.

	11.11	 	Invalidity

If any provision in this Agreement shall be held to be illegal, invalid or
unenforceable, in whole or in part, under any Law:

	 	11.11.1	 	such provision or part shall to that extent be deemed not to form part of
this Agreement but the legality, validity or enforceability of the remainder of
this Agreement shall not be affected;
	 
	 	11.11.2	 	ST and NXP shall use reasonable efforts to agree a replacement provision that
is legal, valid and enforceable to achieve so far as possible the intended
effect of the illegal, invalid or unenforceable provision.

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	11.12	 	Counterparts

This Agreement may be entered into in any number of counterparts, all of which taken together
shall constitute one and the same instrument. ST and NXP may enter into this Agreement by
signing any such counterpart.

	11.13	 	Dispute resolution

	 	11.13.1	 	The Parties will attempt in good faith to resolve promptly any dispute arising out of or
relating to this Agreement by negotiation. If the matter is not resolved in the normal
course of business any Party may give the other Party notice of any such dispute not
resolved, after which the dispute will be referred to the CEOs of the Parties, who will
similarly attempt to resolve the dispute.
	 
	 	11.13.2	 	If the dispute has not been resolved within sixty (60) days after delivery of the notice
referred to in Paragraph 11.13.1, then at the election of any Party, the dispute will be
finally and exclusively settled by arbitration pursuant to the Rules of Conciliation and
Arbitration of the International Chamber of Commerce by three arbiters appointed according
to said Rules, the foregoing without prejudice to any Party’s right to seek injunctive
relief before a competent court. Arbitration shall take place in Paris and the procedure
will be conducted in the English language in accordance with the rules of law. The right,
if any, to discovery is excluded.

	11.14	 	Governing law

This Agreement and the documents to be entered into pursuant to it, save as expressly
otherwise provided therein, shall be governed by and construed in accordance with the Law of
the Netherlands.

AGREED AND SIGNED ON 10 APRIL 2008 BY:

STMicroelectronics N.V.

	 	 	 	 	 	 	 
	 	 	/s/ Carlo Bozotti	 	 
	 	 	 	 	 
	 

	 	Name:
	 	Carlo Bozotti	 	 
	 

	 	Title:
	 	President and CEO	 	 

NXP B.V.

	 	 	 	 	 	 	 
	 	 	/s/ Frans van Houten	 	 
	 	 	 	 	 
	 

	 	Name:
	 	Frans van Houten	 	 
	 

	 	Title:
	 	President and CEO	 	 

36

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