Common use of Mandatory Repurchases or Substitutions Clause in Contracts

Mandatory Repurchases or Substitutions. Upon discovery by a Responsible Officer of the Collateral Manager of a breach of any representation or warranty set forth in Section 3.2 which materially and adversely affects the value of the Collateral Obligations or the interest therein of the Noteholders or which materially and adversely affects the interests of the Noteholders in the related Collateral Obligations in the case of a representation and warranty relating to a particular Collateral Obligation (each such Collateral Obligation, an “Ineligible Collateral Obligation”), the Collateral Manager shall give prompt written notice of such breach or failure to the parties hereunder and the Trustee. Within 30 days of the earlier of the discovery by a Responsible Officer of the Transferor of any such breach or its receipt of notice of any such breach, the Transferor shall (a) promptly cure such breach in all material respects, (b) purchase the Collateral Obligation by depositing in the Collection Account, within such 30-day period, an amount equal to the Transfer Deposit Amount of such Collateral Obligation or (c) remove such Collateral Obligation from the Issuer and substitute therefor one or more Substitute Collateral Obligations satisfying the criteria listed under Section 2.5 of this Agreement and Section 12.3 of the Indenture by not later than 30 days after notice or such discovery of such breach. The Repurchase and Substitution Limit will not apply to any Ineligible Collateral Obligation that is repurchased or substituted by the Transferor in connection with a mandatory repurchase or substitution. Such repurchase and substitution obligations constitute the sole remedy available for a breach of Section 3.2.