================================================================================
INDENTURE
between
FFCA FRANCHISE LOAN OWNER TRUST 1998-1,
as Issuer
and
LASALLE NATIONAL BANK,
as Indenture Trustee
Dated as of August 14, 1998
FFCA FRANCHISE LOAN OWNER TRUST 1998-1
Franchise Loan Backed Notes, Issuable in Series
================================================================================
TABLE OF CONTENTS
PAGE
----
ARTICLE I
DEFINITIONS
Section 1.01. Definitions.............................................2
Section 1.02. Rules of Construction...................................6
ARTICLE II
GENERAL PROVISIONS WITH RESPECT TO THE NOTES; INDENTURE SUPPLEMENT
Section 2.01. Method of Issuance and Form of Notes....................7
Section 2.02. Execution, Authentication, Delivery and Dating..........8
Section 2.03. Registration; Registration of Transfer and Exchange.....9
Section 2.04. Mutilated, Destroyed, Lost or Stolen Notes.............10
Section 2.05. Persons Deemed Noteholders.............................11
Section 2.06. Payment of Principal and/or Interest; Defaulted
Interest............................................11
Section 2.07. Cancellation...........................................11
Section 2.08. Conditions Precedent to the Authentication of Each
Series of Notes.....................................12
Section 2.09. Release of Collateral..................................14
Section 2.10. Additional Note Principal Balance......................14
Section 2.11. Tax Treatment..........................................14
Section 2.12. Limitations on Transfer of the Notes...................15
ARTICLE III
COVENANTS
Section 3.01. Payment of Principal and/or Interest...................15
Section 3.02. Maintenance of Office or Agency........................15
Section 3.03. Money for Payments to Be Held in Trust.................15
Section 3.04. Existence..............................................17
Section 3.05. Protection of Collateral...............................17
Section 3.06. Reserved...............................................18
Section 3.07. Performance of Obligations; Servicing of Loans.........18
Section 3.08. Negative Covenants.....................................19
Section 3.09. Annual Statement as to Compliance......................20
Section 3.10. Covenants of the Issuer................................21
Section 3.11. Servicer's Obligations.................................21
Section 3.12. Restricted Payments....................................21
Section 3.13. Treatment of Notes as Debt for All Purposes............21
Section 3.14. Notice of Events of Default............................21
Section 3.15. Further Instruments and Acts...........................21
-i-
ARTICLE IV
SATISFACTION AND DISCHARGE
Section 4.01. Satisfaction and Discharge of Indenture................22
Section 4.02. Application of Trust Money.............................23
Section 4.03. Repayment of Moneys Held by Paying Agent...............23
ARTICLE V
REMEDIES
Section 5.01. Events of Default......................................23
Section 5.02. Acceleration of Maturity; Rescission and Annulment.....25
Section 5.03. Collection of Indebtedness and Suits for Enforcement
by Indenture Trustee................................26
Section 5.04. Remedies; Priorities...................................28
Section 5.05. Optional Preservation of the Collateral................29
Section 5.06. Limitation of Suits....................................30
Section 5.07. Unconditional Rights of Noteholders to Receive
Principal and/or Interest...........................30
Section 5.08. Restoration of Rights and Remedies.....................30
Section 5.09. Rights and Remedies Cumulative.........................31
Section 5.10. Delay or Omission Not a Waiver.........................31
Section 5.11. Control by Noteholders.................................31
Section 5.12. Waiver of Past Defaults................................32
Section 5.13. Undertaking for Costs..................................32
Section 5.14. Waiver of Stay or Extension Laws.......................32
Section 5.15. Action on Notes........................................33
Section 5.16. Performance and Enforcement of Certain Obligations.....33
ARTICLE VI
THE INDENTURE TRUSTEE
Section 6.01. Duties of Indenture Trustee............................33
Section 6.02. Rights of Indenture Trustee............................35
Section 6.03. Individual Rights of Indenture Trustee.................35
Section 6.04. Indenture Trustee's Disclaimer.........................36
Section 6.05. Notices of Default.....................................36
Section 6.06. Reports by Indenture Trustee to Holders................36
Section 6.07. Compensation and Indemnity.............................36
Section 6.08. Replacement of Indenture Trustee.......................37
Section 6.09. Successor Indenture Trustee by Merger..................37
-ii-
Section 6.10. Appointment of Co-Indenture Trustee or Separate
Indenture Trustee...................................38
Section 6.11. Eligibility............................................39
ARTICLE VII
NOTEHOLDERS'LISTS AND REPORTS
Section 7.01. Issuer to Furnish Indenture Trustee Names and
Addresses of Noteholders............................39
Section 7.02. Preservation of Information............................39
Section 7.03. 144A Information.......................................40
ARTICLE VIII
ACCOUNTS, DISBURSEMENTS AND RELEASES
Section 8.01. Collection of Money....................................40
Section 8.02. Trust Accounts; Distributions..........................40
Section 8.03. General Provisions Regarding Trust Accounts............41
Section 8.04. Servicer's Statements..................................42
Section 8.05. Release of Collateral..................................42
Section 8.06. Opinion of Counsel.....................................42
ARTICLE IX
SUPPLEMENTAL INDENTURES
Section 9.01. Supplemental Indentures Without the Consent of the
Noteholders.........................................42
Section 9.02. Supplemental Indentures with Consent of Noteholders....43
Section 9.03. Execution of Supplemental Indentures...................45
Section 9.04. Effect of Supplemental Indentures......................45
Section 9.05. Reference in Notes to Supplemental Indentures..........45
ARTICLE X
REDEMPTION OF NOTES
Section 10.01. Redemption.............................................45
Section 10.02. Form of Redemption Notice..............................45
Section 10.03. Notes Payable on Redemption Date; Provision for
Payment of Indenture Trustee........................46
-iii-
ARTICLE XI
MISCELLANEOUS
Section 11.01. Compliance Certificates and Opinions, etc..............46
Section 11.02. Form of Documents Delivered to Indenture Trustee.......47
Section 11.03. Acts of Noteholders....................................48
Section 11.04. Notices, etc., to Indenture Trustee and Issuer.........48
Section 11.05. Notices to Noteholders; Waiver.........................48
Section 11.06. Effect of Headings and Table of Contents...............49
Section 11.07. Successors and Assigns.................................49
Section 11.08. Separability...........................................49
Section 11.09. Benefits of Indenture..................................49
Section 11.10. Legal Holidays.........................................49
Section 11.11. Governing Law..........................................50
Section 11.12. Counterparts...........................................50
Section 11.13. Recording of Indenture.................................50
Section 11.14. Trust Obligation.......................................50
Section 11.15. No Petition............................................50
Section 11.16. Inspection.............................................51
EXHIBITS
EXHIBIT A - Form of Notes
EXHIBIT B-1 - Form of Transferor Affidavit (144A)
EXHIBIT B-2 - Form of Transferee Affidavit (Accredited Investor)
EXHIBIT B-3 - Form of Transfer Affidavit
EXHIBIT C - Form of Securities Legend
EXHIBIT D - Form of Indenture Supplement
-iv-
This Indenture entered into effective August 14, 1998, between
FFCA FRANCHISE LOAN OWNER TRUST 1998-1, a Delaware business trust, as Issuer
(the "ISSUER"), and LASALLE NATIONAL BANK, as Indenture Trustee (the "INDENTURE
TRUSTEE"),
W I T N E S S E T H T H A T:
In consideration of the mutual covenants herein contained, the
Issuer has duly authorized the execution and delivery of this Indenture to
provide for one or more Series of Notes, issuable as provided in this Indenture.
Each Series of such Notes will be issued only under a separate Indenture
Supplement to this Indenture duly executed and delivered by the Issuer and the
Trustee and limited to the amount therein prescribed; provided that only one
such Series may be Outstanding at any time. All covenants and agreements made by
the Issuer herein are for the benefit and security of the Noteholders.
GRANTING CLAUSE
Subject to the terms of this Indenture, the Issuer hereby
Grants on the Closing Date, to the Indenture Trustee, as Indenture Trustee for
the benefit of the Noteholders, all of the Issuer's right, title and interest,
whether now owned or hereafter acquired, in and to: (i) the Trust Estate (as
defined in the Sale and Servicing Agreement); (ii) all right, title and interest
of the Issuer in and to the Sale and Servicing Agreement (including the Issuer's
right to cause the Loan Originator to repurchase Loans from the Issuer under
certain circumstances described therein); (iii) all present and future claims,
demands, causes of action and choses in action in respect of any or all of the
foregoing and all payments on or under and all proceeds of every kind and nature
whatsoever in respect of any or all of the foregoing, including all proceeds of
the conversion thereof, voluntary or involuntary, into cash or other liquid
property, all cash proceeds, accounts, accounts receivable, notes, drafts,
acceptances, chattel paper, checks, deposit accounts, insurance proceeds,
condemnation awards, rights to payment of any and every kind and other forms of
obligations and receivables, instruments and other property which at any time
constitute all or part of or are included in the proceeds of any of the
foregoing; (iv) all funds on deposit from time to time in the Trust Accounts
including, without limitation, amounts on deposit in such accounts that are
Permitted Investments; and (v) all other property of the Trust from time to time
(collectively, the "COLLATERAL").
The foregoing Grant is made in trust to secure the payment of
principal of and interest on, and any other amounts owing in respect of, the
Notes, and to secure compliance with the provisions of this Indenture, all as
provided in this Indenture.
The Indenture Trustee, as Indenture Trustee on behalf of the
Noteholders, acknowledges such Grant, accepts the trusts hereunder and agrees to
perform its duties required in this Indenture to the best of its ability to the
end that the interests of the Noteholders may adequately and effectively be
protected.
- 1 -
ARTICLE I
DEFINITIONS
Section 1.01. DEFINITIONS. (a) Except as otherwise specified
herein, in an Indenture Supplement or as the context may otherwise require, the
following terms have the respective meanings set forth below for all purposes of
this Indenture.
"ACT" has the meaning specified in Section 11.03(a) hereof.
"ADMINISTRATION AGREEMENT" means the Administration Agreement
dated as of August 14, 1998, among the Issuer and FFCA, as Administrator, and as
Servicer.
"ADMINISTRATOR" means FFCA, or any successor Administrator
under the Administration Agreement.
"AUTHORIZED OFFICER" means, with respect to the Issuer, any
officer of the Owner Trustee who is authorized to act for the Owner Trustee in
matters relating to the Issuer and who is identified on the list of Authorized
Officers delivered by the Owner Trustee to the Indenture Trustee on the Closing
Date (as such list may be modified or supplemented from time to time thereafter)
and, so long as the Administration Agreement is in effect, any Vice President or
more senior officer of the Administrator who is authorized to act for the
Administrator in matters relating to the Issuer and to be acted upon by the
Administrator pursuant to the Administration Agreement and who is identified on
the list of Authorized Officers delivered by the Administrator to the Indenture
Trustee on the Closing Date (as such list may be modified or supplemented from
time to time thereafter).
"CERTIFICATE OF TRUST" means the certificate of trust of the
Issuer substantially in the form of Exhibit C to the Trust Agreement.
"CLOSING DATE" means August 14, 1998, or with respect to a
Series of Notes subsequent to the Series 1998-1 Notes, as set forth in the
Indenture Supplement related to such Series.
"COLLATERAL" has the meaning specified in the Granting Clause
of this Indenture.
"COMMISSION" means the Securities and Exchange Commission.
"CORPORATE TRUST OFFICE" means the principal office of the
Indenture Trustee at which at any particular time its corporate trust business
shall be administered, which office at date of execution of this Agreement is
located at 000 Xxxxx XxXxxxx Xxxxxx, Xxxxx 0000, Xxxxxxx, Xxxxxxxx 00000-0000,
Attention: Asset-Backed Securities Trust Services Group, FFCA Franchise Loan
Owner Trust 1998-1, telecopy number: (000) 000-0000, telephone number: (312)
000-0000, or at such other address as the Indenture Trustee may designate from
time to time by notice to the Noteholders and the Issuer, or the principal
corporate trust office of any successor Indenture Trustee at the address
designated by such successor Indenture Trustee by notice to the Noteholders and
the Issuer.
- 2 -
"DEFAULT" means any occurrence that is, or with notice or the
lapse of time or both would become, an Event of Default.
"DEPOSITOR" shall mean FFCA Warehouse Lending Corporation, a
Delaware corporation, in its capacity as depositor under the Sale and Servicing
Agreement, or any successor in interest thereto.
"DEPOSITORY INSTITUTION" means any depository institution or
trust company, including the Indenture Trustee, that (a) is incorporated under
the laws of the United States of America or any State thereof, (b) is subject to
supervision and examination by federal or state banking authorities and (c) has
outstanding unsecured commercial paper or other short-term unsecured debt
obligations that are rated at a rating to which the Majority Noteholders consent
in writing.
"EVENT OF DEFAULT" has the meaning specified in Section 5.01
hereof.
"EXCHANGE ACT" means the Securities Exchange Act of 1934, as
amended.
"EXECUTIVE OFFICER" means, with respect to (i) FFCA, FFCA
Acquisition Corporation, FFCA Loan Warehouse Corporation or any Affiliate of any
of them, the President, any Executive Vice President, any Senior Vice President
or the Treasurer of such corporation; and with respect to any partnership, any
general partner thereof, (ii) the Note Registrar, any Responsible Officer of the
Indenture Trustee, (iii) any other corporation, the Chief Executive Officer,
Chief Operating Officer, Chief Financial Officer, President, Executive Vice
President, any Vice President, the Secretary or the Treasurer of such entity and
(iv) any partnership, any general partner thereof.
"FFCA" means Franchise Finance Corporation of America, a
Delaware corporation.
"FFCA ACQUISITION CORP." means FFCA Acquisition Corporation, a
Delaware corporation.
"GRANT" means mortgage, pledge, bargain, sell, warrant,
alienate, remise, release, convey, assign, transfer, create and xxxxx x xxxx
upon and a security interest in and right of set-off against, deposit, set over
and confirm pursuant to this Indenture. A Grant of the Collateral or of any
other agreement or instrument shall include all rights, powers and options (but
none of the obligations) of the granting party thereunder, including the
immediate and continuing right to claim for, collect, receive and give receipt
for principal and interest payments in respect of the Collateral and all other
moneys payable thereunder, to give and receive notices and other communications,
to make waivers or other agreements, to exercise all rights and options, to
bring Proceedings in the name of the granting party or otherwise, and generally
to do and receive anything that the granting party is or may be entitled to do
or receive thereunder or with respect thereto.
"HOLDER" or "NOTEHOLDER" means the Person in whose name a Note
is registered on the Note Register.
- 3 -
"INDENTURE" means this Indenture as supplemented by each
Indenture Supplement.
"INDENTURE SUPPLEMENT" means, with respect to a Series of
Notes, the Indenture Supplement, substantially in the form of Exhibit D hereto,
pursuant to which such Series of Notes was issued.
"INDENTURE TRUSTEE" means LaSalle National Bank, a national
banking association, as Indenture Trustee under this Indenture, or any successor
Indenture Trustee hereunder.
"ISSUER" means FFCA Franchise Loan Owner Trust 1998-1.
"ISSUER ORDER" and "ISSUER REQUEST" mean a written order or
request signed in the name of the Issuer by any one of its Authorized Officers
and delivered to the Indenture Trustee.
"LOAN ORIGINATOR" means FFCA Acquisition Corp.
"MATURITY DATE" means, with respect to the Notes of a given
Series, as set forth in the related Indenture Supplement.
"NOTE" means any Note authorized by and authenticated and
delivered under this Indenture and the related Indenture Supplement.
"NOTE INTEREST RATE" means for each day the Notes are
Outstanding, a per annum interest rate equal to LIBOR for the related LIBOR
Determination Date plus the LIBOR Margin for such day.
"NOTE REGISTER" and "Note Registrar" have the respective
meanings specified in SECTION 2.03 hereof.
"OFFICER'S CERTIFICATE" means a certificate signed by any
Authorized Officer of the Issuer or the Administrator, under the circumstances
described in, and otherwise complying with, the applicable requirements of
SECTION 11.01 hereof, and delivered to the Indenture Trustee. Unless otherwise
specified, any reference in this Indenture to an Officer's Certificate shall be
to an Officer's Certificate of any Authorized Officer of the Issuer or the
Administrator.
"OPINION OF COUNSEL" means one or more written opinions of
counsel who may, except as otherwise expressly provided in this Indenture, be an
employee of or counsel to the Issuer, and which opinion or opinions shall be
addressed to the Indenture Trustee, as Indenture Trustee, and shall comply with
any applicable requirements of SECTION 11.01 hereof and shall be in form and
substance satisfactory to the Initial Noteholder.
"OUTSTANDING" means, with respect to any Note and as of the
date of determination, any Note theretofore authenticated and delivered under
this Indenture except:
(i) Notes theretofore cancelled by the Note Registrar or
delivered to the Note Registrar for cancellation;
- 4 -
(ii) Notes or portions thereof the payment for which money in
the necessary amount has theretofore been deposited with the Indenture
Trustee or any Paying Agent in trust for the Noteholders (provided,
however, that if such Notes are to be redeemed, notice of such
redemption has been duly given pursuant to this Indenture or provision
for such notice satisfactory to the Indenture Trustee has been made);
(iii) Notes in exchange for or in lieu of which other Notes
have been authenticated and delivered pursuant to this Indenture unless
proof satisfactory to the Indenture Trustee is presented that any such
Notes are held by a bona fide purchaser; provided, however, that in
determining whether the Noteholders representing the requisite
Percentage Interests of the Outstanding Notes have given any request,
demand, authorization, direction, notice, consent or waiver hereunder
or under any Basic Document, Notes owned by the Issuer, any other
obligor upon the Notes, the Loan Originator or any Affiliate of any of
the foregoing Persons shall be disregarded and deemed not to be
Outstanding, except that, in determining whether the Indenture Trustee
shall be protected in relying upon any such request, demand,
authorization, direction, notice, consent or waiver, only Notes that
the Indenture Trustee actually knows to be owned in such manner shall
be disregarded. Notes owned in such manner that have been pledged in
good faith may be regarded as Outstanding if the pledgee certifies to
the Indenture Trustee (i) that the pledgee has the right so to act with
respect to such Notes and (ii) that the pledgee is not the Issuer, any
other obligor upon the Notes, the Loan Originator or any Affiliate of
any of the foregoing Persons; and
(iv) Notes for which the related Maturity Date has occurred.
"OWNER TRUSTEE" means Wilmington Trust Company, not in its
individual capacity but solely as Owner Trustee under the Trust Agreement, or
any successor Owner Trustee under the Trust Agreement.
"PAYING AGENT" means the Indenture Trustee or any other Person
that meets the eligibility standards for the Indenture Trustee specified in
SECTION 6.11 hereof (unless the Paying Agent is the Administrator) and is
authorized by the Issuer to make payments to and distributions from the
Collection Account and the Distribution Account, including payment of principal
of or interest on the Notes on behalf of the Issuer.
"PAYMENT DATE" means the 12th day of each calendar month
commencing on the first such 12th day to occur after the first Transfer Date, or
if any such day is not a Business Day, the first Business Day immediately
following such day.
"PERCENTAGE INTEREST" means, with respect to any Note and as
of any date of determination, the percentage equal to a fraction, the numerator
of which is the principal balance of such Note as of such date of determination
and the denominator of which is the Note Principal Balance.
"PREDECESSOR NOTE" means, with respect to any particular Note,
every previous Note evidencing all or a portion of the same debt as that
evidenced by such particular Note; and,
- 5 -
for the purpose of this definition, any Note authenticated and delivered under
SECTION 2.04 hereof in lieu of a mutilated, lost, destroyed or stolen Note shall
be deemed to evidence the same debt as the mutilated, lost, destroyed or stolen
Note.
"PROCEEDING" means any suit in equity, action at law or other
judicial or administrative proceeding.
"REDEMPTION DATE" means in the case of a redemption of the
Notes pursuant to SECTION 10.01 hereof, the Payment Date specified by the
Servicer or the Issuer pursuant to such SECTION 10.01.
"REGISTERED HOLDER" means the Person in the name of which a
Note is registered on the Note Register on the applicable Record Date.
"TRUST CERTIFICATE" has the meaning assigned to such term in
SECTION 1.1 of the Trust Agreement.
"SALE AGENT" has the meaning assigned to such term in SECTION
5.11 hereof.
"SALE AND SERVICING AGREEMENT" means the Sale and Servicing
Agreement dated as of August 14, 1998, among the Issuer, FFCA Warehouse Lending
Corporation, as Depositor, FFCA Acquisition Corp., as the Loan Originator, FFCA,
as Servicer, and the Indenture Trustee.
"SERIES" means a separate series of Notes issued pursuant to
this Indenture per the terms of this Indenture as supplemented by the related
Indenture Supplement.
"SERVICER" shall mean FFCA, in its capacity as servicer under
the Sale and Servicing Agreement, and any successor servicer thereunder.
"SERVICING DEFAULT" means an Event of Default under the Sale
and Servicing Agreement.
"STATE" means any one of the States of the United States of
America or the District of Columbia.
"TRUST AGREEMENT" means the Trust Agreement dated as of March
13, 1998, as amended, among FFCA Warehouse Lending Corporation, as Depositor,
FFCA and Wilmington Trust Company, as Owner Trustee.
"TRUST INDENTURE ACT" means the Trust Indenture Act of 1939 as
in force on the date hereof, unless otherwise specifically provided.
(b) Except as otherwise specified herein or as the context may
otherwise require, capitalized terms used but not otherwise defined herein have
the respective meanings set forth in the Sale and Servicing Agreement for all
purposes of this Indenture.
Section 1.02. RULES OF CONSTRUCTION. Unless the context
otherwise requires:
- 6 -
(i) a term has the meaning assigned to it;
(ii) an accounting term not otherwise defined has the meaning
assigned to it in accordance with GAAP;
(iii) "or" is not exclusive;
(iv) "including" means including without limitation;
(v) words in the singular include the plural and words in the
plural include the singular;
(vi) any agreement, instrument or statute defined or referred
to herein or in any instrument or certificate delivered in connection
herewith means such agreement, instrument or statute as from time to
time amended, modified or supplemented (as provided in such agreements)
and includes (in the case of agreements or instruments) references to
all attachments thereto and instruments incorporated therein;
references to a Person are also to its permitted successors and
assigns; and
(vii) to the extent that any of the terms of this Indenture
conflict with the terms of an Indenture Supplement; the terms of such
Indenture Supplement shall govern.
ARTICLE II
GENERAL PROVISIONS WITH RESPECT TO THE NOTES; INDENTURE SUPPLEMENT
GENERAL PROVISIONS WITH RESPECT TO THE NOTES; INDENTURE SUPPLEMENT
Section 2.01. METHOD OF ISSUANCE AND FORM OF NOTES.
(a) ISSUANCE PURSUANT TO INDENTURE SUPPLEMENT. The Notes may,
as provided herein, be issued in one or more Series and shall be designated
generally as the "Franchise Loan Backed Notes Series _______" of the Issuer,
with such further particular designations added or incorporated in such title
for the Notes of any particular Series as the Issuer may determine; provided
that only one such Series may be Outstanding at any given time. Each Note within
a Series shall bear upon its face the designation so selected for such Series.
All Notes of the same Series shall be identical in all respects except for the
denominations thereof. All Notes of a particular Series issued under this
Indenture shall be in all respects equally and ratably entitled to the benefits
thereof without preference, priority or distinction on account of the actual
time or times of authentication and delivery, all in accordance with the terms
and provisions of this Indenture.
Each Series of Notes shall be created by an Indenture
Supplement authorized by the Issuer by Issuer Order, which Indenture Supplement
shall establish certain of the terms and provisions of such Series of Notes. The
several Series, only one of which may be Outstanding at any given time, may
differ as between Series in respect of any of the following matters, which, as
applicable to a particular Series of Notes will be specified in the related
Indenture Supplement:
- 7 -
(i) designation of the Series;
(ii) the Closing Date;
(iii) the Maximum Note Principal Balance;
(iv) the Revolving Period termination date; and
(v) the Maturity Date.
(b) FORM. The Notes of each Series shall bear the Series
designation set forth in the related Indenture Supplement.
The Notes may be typewritten, printed, lithographed or
engraved or produced by any combination of these methods, all as determined by
the officers executing such Notes, as evidenced by their execution of such
Notes.
Each Note shall be dated the date of its authentication. The
terms of the Notes of each Series will be set forth in the related Indenture
Supplement.
The Notes of each Series shall be in definitive form and shall
bear a legend substantially in the form of EXHIBIT C attached hereto.
Section 2.02. EXECUTION, AUTHENTICATION, DELIVERY AND DATING.
The Notes shall be executed on behalf of the Issuer by an Authorized Officer of
the Owner Trustee or the Administrator. The signature of any such Authorized
Officer on the Notes may be manual or facsimile.
Notes bearing the manual or facsimile signature of individuals
who were at any time Authorized Officers of the Owner Trustee or the
Administrator shall bind the Issuer, notwithstanding that such individuals or
any of them have ceased to hold such offices prior to the authentication and
delivery of such Notes or did not hold such offices at the date of such Notes.
Subject to the satisfaction of the conditions set forth in
SECTION 2.08 hereof, the Indenture Trustee shall upon Issuer Order authenticate
and deliver the Notes.
The Notes that are authenticated and delivered by the
Indenture Trustee to or upon the order of the Issuer on the Closing Date shall
be dated as of such Closing Date. All other Notes that are authenticated after
the Closing Date for any other purpose under the Indenture shall be dated the
date of their authentication. The Notes shall be issued in such denominations as
may be agreed by the Issuer and the Initial Noteholder.
No Note shall be entitled to any benefit under this Indenture
or be valid or obligatory for any purpose, unless there appears on such Note a
certificate of authentication substantially in the form provided for herein
executed by the Indenture Trustee by the manual signature of one of its
authorized signatories, and such certificate upon any Note shall be
- 8 -
conclusive evidence, and the only evidence, that such Note has been duly
authenticated and delivered hereunder.
Section 2.03. REGISTRATION; REGISTRATION OF TRANSFER AND
EXCHANGE. The Issuer shall cause to be kept a register (the "NOTE REGISTER") in
which, subject to such reasonable regulations as it may prescribe, the Issuer
shall provide for the registration of Notes and the registration of transfers of
Notes. The Indenture Trustee initially shall be the "NOTE REGISTRAR" for the
purpose of registering Notes and transfers of Notes as herein provided. Upon any
resignation of any Note Registrar, the Issuer shall promptly appoint a successor
or, if it elects not to make such an appointment, assume the duties of Note
Registrar.
If a Person other than the Indenture Trustee is appointed by
the Issuer as Note Registrar, the Issuer will give the Indenture Trustee prompt
written notice of the appointment of such Note Registrar and of the location,
and any change in the location, of the Note Register, and the Indenture Trustee
shall have the right to inspect the Note Register at all reasonable times and to
obtain copies thereof, and the Indenture Trustee shall have the right to rely
upon a certificate executed on behalf of the Note Registrar by an Executive
Officer thereof as to the names and addresses of the Noteholders and the
principal amounts and number of the Notes.
Upon surrender for registration of transfer of any Note at the
office or agency of the Issuer to be maintained as provided in SECTION 3.02
hereof, the Issuer shall execute, and the Indenture Trustee shall authenticate
and the Noteholder shall obtain from the Indenture Trustee, in the name of the
designated transferee or transferees, one or more new Notes in any authorized
denominations, of a like aggregate Note Principal Balance.
At the option of the Holder, Notes may be exchanged for other
Notes in any authorized denominations, of a like aggregate principal amount,
upon surrender of the Notes to be exchanged at such office or agency. Whenever
any Notes are so surrendered for exchange, the Issuer shall execute, and the
Indenture Trustee shall authenticate and the Noteholder shall obtain from the
Indenture Trustee, the Notes which the Noteholder making the exchange is
entitled to receive.
All Notes issued upon any registration of transfer or exchange
of Notes shall be the valid obligations of the Issuer, evidencing the same debt,
and entitled to the same benefits under this Indenture, as the Notes surrendered
upon such registration of transfer or exchange.
Every Note presented or surrendered for registration of
transfer or exchange shall be duly endorsed by, or be accompanied by a written
instrument of transfer in the form attached to the form of Note attached as
Exhibit C hereto duly executed by, the Holder thereof or such Holder's attorney
duly authorized in writing, with such signature guaranteed by an "eligible
guarantor institution" meeting the requirements of the Securities Transfer
Agents' Medallion Program ("STAMP").
No service charge shall be made to a Noteholder for any
registration of transfer or exchange of Notes, but the Issuer may require
payment of a sum sufficient to cover any tax or other governmental charge that
may be imposed in connection with any registration of transfer or
- 9 -
exchange of Notes, other than exchanges pursuant to SECTION 9.05 hereof not
involving any transfer.
The preceding provisions of this SECTION 2.03 notwithstanding,
the Issuer shall not be required to make, and the Note Registrar need not
register, transfers or exchanges of Notes selected for redemption or of any Note
for a period of 15 days preceding the due date for any payment with respect to
such Note.
Section 2.04. MUTILATED, DESTROYED, LOST OR STOLEN NOTES. If
(i) any mutilated Note is surrendered to the Indenture Trustee, or the Indenture
Trustee receives evidence to its satisfaction of the destruction, loss or theft
of any Note, and (ii) there is delivered to the Issuer and Indenture Trustee
such security or indemnity as may reasonably be required by it to hold the
Issuer and the Indenture Trustee, as applicable, harmless, then, in the absence
of notice to the Issuer, the Note Registrar or the Indenture Trustee that such
Note has been acquired by a bona fide purchaser, an Authorized Officer of the
Owner Trustee or the Administrator on behalf of the Issuer shall execute, and
upon its written request the Indenture Trustee shall authenticate and deliver,
in exchange for or in lieu of any such mutilated, destroyed, lost or stolen
Note, a replacement Note; provided, however, that if any such destroyed, lost or
stolen Note, but not a mutilated Note, shall have become or within seven days
shall be due and payable, or shall have been called for redemption, instead of
issuing a replacement Note, the Issuer may pay such destroyed, lost or stolen
Note when so due or payable or upon the Redemption Date without surrender
thereof. If, after the delivery of such replacement Note or payment of a
destroyed, lost or stolen Note pursuant to the proviso to the preceding
sentence, a bona fide purchaser of the original Note in lieu of which such
replacement Note was issued presents for payment such original Note, the Issuer
shall be entitled to recover such replacement Note (or such payment) from the
Person to which it was delivered or any Person taking such replacement Note from
such Person to which such replacement Note was delivered or any assignee of such
Person, except a bona fide purchaser, and the Issuer and the Indenture Trustee
shall be entitled to recover upon the security or indemnity provided therefor to
the extent of any loss, damage, cost or expense incurred by the Issuer or the
Indenture Trustee in connection therewith.
Upon the issuance of any replacement Note under this SECTION
2.04, the Issuer may require the payment by the Holder of such Note of a sum
sufficient to cover any tax or other governmental charge that may be imposed in
relation thereto and any other reasonable expenses (including the fees and
expenses of the Indenture Trustee) connected therewith.
Every replacement Note issued pursuant to this SECTION 2.04 in
replacement of any mutilated, destroyed, lost or stolen Note shall constitute an
original additional contractual obligation of the Issuer, whether or not the
mutilated, destroyed, lost or stolen Note shall be at any time enforceable by
anyone, and shall be entitled to all the benefits of this Indenture equally and
proportionately with any and all other Notes duly issued hereunder.
The provisions of this SECTION 2.04 are exclusive and shall
preclude (to the extent lawful) all other rights and remedies with respect to
the replacement or payment of mutilated, destroyed, lost or stolen Notes.
- 10 -
Section 2.05. PERSONS DEEMED NOTEHOLDERS. Prior to due
presentment for registration of transfer of any Note, the Issuer, the Indenture
Trustee and any agent of the Issuer or the Indenture Trustee may treat the
Person in the name of which any Note is registered (as of the day of
determination) as the Noteholder for the purpose of receiving payments of
principal of and interest, if any, on such Note and for all other purposes
whatsoever, whether or not such Note be overdue, and none of the Issuer, the
Indenture Trustee or any agent of the Issuer or the Indenture Trustee shall be
affected by notice to the contrary.
Section 2.06. PAYMENT OF PRINCIPAL AND/OR INTEREST; DEFAULTED
INTEREST. (a) The Notes shall accrue interest at the Note Interest Rate, and
such interest shall be payable on each Payment Date, subject to SECTION 3.01
hereof. Any installment of interest or principal, if any, payable on any Note
that is punctually paid or duly provided for by the Issuer on the applicable
Payment Date shall be paid to the Person in the name of which such Note (or one
or more Predecessor Notes) is registered on the Record Date by wire transfer if
written instructions therefor are provided to the Indenture Trustee no later
than five Business Days prior to such Payment Date, and otherwise by check
mailed first-class postage prepaid to such Person's address as it appears on the
Note Register on such Record Date, except that with respect to Notes registered
on the Record Date in the name of the nominee of the Initial Noteholder, payment
will be made by wire transfer in immediately available funds to the account
designated by such nominee and except for the final installment of principal
payable with respect to such Note on a Payment Date or on the Maturity Date (and
except for the Termination Price for any Note called for redemption pursuant to
SECTION 10.01) hereof, which shall be payable as provided in SECTION 2.06(B)
below. The funds represented by any such checks returned undelivered shall be
held in accordance with SECTION 3.03 hereof.
(b) The principal of each Note shall be payable in
installments on each Payment Date as provided in the form of the Notes set forth
in EXHIBIT A hereto. Notwithstanding the foregoing, the entire unpaid principal
amount of the Notes shall be due and payable, if not previously paid, on the
earlier of (i) the Maturity Date, (ii) the Redemption Date or (iii) the date on
which an Event of Default shall have occurred and be continuing, if the
Indenture Trustee or the Majority Noteholders shall have declared the Notes to
be immediately due and payable in the manner provided in SECTION 5.02 hereof.
All principal payments on the Notes shall be made pro rata to
the Noteholders based on their respective Percentage Interests. The Indenture
Trustee shall notify the Person in the name of which a Note is registered at the
close of business on the Record Date preceding the Payment Date on which the
Issuer expects that the final installment of principal of and interest on such
Note will be paid. Such notice shall be mailed or transmitted by facsimile prior
to such final Payment Date and shall specify that such final installment will be
payable only upon presentation and surrender of such Note and shall specify the
place where such Note may be presented and surrendered for payment of such
installment. Notices in connection with redemptions of Notes shall be provided
to Noteholders as set forth in SECTION 10.02 hereof.
Section 2.07. CANCELLATION. All Notes surrendered for payment,
registration of transfer, exchange or redemption shall, if surrendered to any
Person other than the Indenture Trustee, be delivered to the Indenture Trustee
and shall promptly be cancelled by the Indenture
- 11 -
Trustee. The Issuer may at any time deliver to the Indenture Trustee for
cancellation any Notes previously authenticated and delivered hereunder which
the Issuer may have acquired in any manner whatsoever, and all Notes so
delivered shall promptly be cancelled by the Indenture Trustee. No Notes shall
be authenticated in lieu of or in exchange for any Notes cancelled as provided
in this SECTION 2.07, except as expressly permitted by this Indenture. All
cancelled Notes may be held or disposed of by the Indenture Trustee in
accordance with its standard retention or disposal policy as in effect at the
time unless the Issuer shall direct by an Issuer Order that they be destroyed or
returned to it; provided, however, that such Issuer Order is timely and the
Notes have not been previously disposed of by the Indenture Trustee.
Section 2.08. CONDITIONS PRECEDENT TO THE AUTHENTICATION OF
EACH SERIES OF NOTES. The Notes of each Series may be authenticated by the
Indenture Trustee, upon Issuer Request and upon receipt by the Indenture Trustee
of the following:
(a) An Issuer Order authorizing the execution and
authentication of such Notes by the Issuer.
(b) All of the items of Collateral which shall be delivered to
the Indenture Trustee or its designee.
(c) An executed counterpart of the related Indenture
Supplement and each other Basic Document.
(d) An Opinion of Counsel addressed to the Indenture Trustee
to the effect that:
(i) all conditions precedent provided for in this Indenture
relating to the authentication of the Notes have been complied with;
(ii) the Owner Trustee has power and authority to execute,
deliver and perform its obligations under the Trust Agreement;
(iii) the Issuer has been duly formed, is validly existing as
a business trust under the laws of the State of Delaware, 12 Del. C.
Section 3801 et seq., and has power, authority and legal right to
execute and deliver this Indenture, the Administration Agreement and
the Sale and Servicing Agreement;
(iv) assuming due authorization, execution and delivery hereof
by the Indenture Trustee, the Indenture, as supplemented by the related
Indenture Supplement, is a valid, legal and binding obligation of the
Issuer, enforceable in accordance with its terms, subject to
bankruptcy, insolvency, reorganization, arrangement, moratorium,
fraudulent or preferential conveyance and other similar laws of general
application affecting the rights of creditors generally and to general
principles of equity (regardless of whether such enforcement is
considered in a Proceeding in equity or at law);
(v) the Notes, when executed and authenticated as provided
herein and delivered against payment therefor, will be the valid, legal
and binding obligations of the
- 12 -
Issuer pursuant to the terms of this Indenture, as supplemented by the
related Indenture Supplement, entitled to the benefits of this
Indenture, as supplemented by the related Indenture Supplement, and
will be enforceable in accordance with their terms, subject to
bankruptcy, insolvency, reorganization, arrangement, moratorium,
fraudulent or preferential conveyance and other similar laws of general
application affecting the rights of creditors generally and to general
principles of equity (regardless of whether such enforcement is
considered in a Proceeding in equity or at law);
(vi) the Trust Agreement authorizes the Issuer to Grant the
Collateral to the Indenture Trustee as security for the Notes;
(vii) this Indenture is not required to be registered under
the Trust Indenture Act;
(viii) no authorization, approval or consent of any
governmental body having jurisdiction in the premises which has not
been obtained by the Issuer is required to be obtained by the Issuer
for the valid issuance and delivery of the Notes, except that no
opinion need be expressed with respect to any such authorizations,
approvals or consents as may be required under any state securities or
"blue sky" laws;
(ix) with respect to each Series after the initial Series,
that such action has been taken with respect to the recording, filing,
re-recording and refiling of this Indenture, any Indenture Supplement
or other supplement hereto or amendment hereof and any other requisite
documents and with respect to the execution and filing of any financing
statements and continuation statements as is necessary to maintain the
lien and security interest created by this Indenture, with recitals of
the details of such action or stating that in the opinion of such
counsel all necessary action to maintain such lien and security
interest has been taken, and describing the recording, filing,
re-recording and refiling of this Indenture, any indentures
supplemental hereto and any other requisite documents and the execution
and filing of any financing statements and continuation statements that
will, in the opinion of such counsel, be required to maintain the lien
and security interest of this Indenture until the issuance of the next
succeeding Series of Notes; and
(x) any other matters that the Indenture Trustee may
reasonably request.
(e) An Officer's Certificate complying with the requirements
of SECTION 11.01 hereof and stating that:
(i) the Issuer is not in Default under this Indenture and the
issuance of the Notes applied for will not result in any breach of any
of the terms, conditions or provisions of, or constitute a default
under, the Trust Agreement, any indenture, mortgage, deed of trust or
other agreement or instrument to which the Issuer is a party or by
which it is bound, or any order of any court or administrative agency
entered in any Proceeding to which the Issuer is a party or by which it
may be bound or to which it may be subject, and that all conditions
precedent provided in this Indenture relating to the authentication and
delivery of the Notes applied for have been complied with;
- 13 -
(ii) the Issuer is the owner of all of the Loans, has not
assigned any interest or participation in the Loans (or, if any such
interest or participation has been assigned, it has been released) and
has the right to Grant all of the Loans to the Indenture Trustee;
(iii) the Issuer has Granted to the Indenture Trustee all of
its right, title and interest in and to the Collateral, and has
delivered or caused the same to be delivered to the Indenture Trustee;
and
(iv) all conditions precedent provided for in this Indenture
relating to the authentication of the Notes have been complied with.
Section 2.09. RELEASE OF COLLATERAL. (a) Except as otherwise
provided by the terms of the Basic Documents, the Indenture Trustee shall
release property from the lien of this Indenture only upon receipt of an Issuer
Request accompanied by the written consent of the Majority Noteholders.
(b) The Indenture Trustee shall, if requested by the Servicer,
temporarily release or cause the Custodian temporarily to release to the
Servicer the Indenture Trustee's Loan File pursuant to the provisions of SECTION
5(B) of the Custodial Agreement upon compliance by the Servicer with the
provisions thereof; provided, however, that the Indenture Trustee's Loan File
shall have been stamped to signify the Issuer's pledge to the Indenture Trustee
under the Indenture.
Section 2.10. ADDITIONAL NOTE PRINCIPAL BALANCE. In the event
of an advance of Additional Note Principal Balance by the Noteholders as
provided in SECTION 2.01(C) of the Sale and Servicing Agreement, each Noteholder
shall, and is hereby authorized to, record on the schedule attached to its Note
the date and amount of any Additional Note Principal Balance advanced by it, and
each repayment thereof; provided that failure to make any such recordation on
such schedule or any error in such schedule shall not adversely affect any
Noteholder's rights with respect to its Additional Note Principal Balance and
its right to receive interest payments in respect of the Additional Note
Principal Balance held by such Noteholder.
Absent manifest error, the Note Principal Balance of each Note
as set forth in the notations made by the related Noteholder on such Note shall
be binding upon the Indenture Trustee and the Issuer; provided that failure by a
Noteholder to make such recordation on its Note or any error in such notation
shall not adversely affect any Noteholder's rights with respect to its Note
Principal Balance and its right to receive principal and interest payments in
respect thereof.
Section 2.11. TAX TREATMENT. The Issuer has entered into this
Indenture, and the Notes will be issued, with the intention that for all
purposes, including federal, state and local income, single business and
franchise tax purposes, the Notes will qualify as indebtedness of the Issuer
secured by the Collateral. The Issuer, by entering into this Indenture, and each
Noteholder, by its acceptance of a Note, agree to treat the Notes for all
purposes, including federal, state and local income, single business and
franchise tax purposes, as indebtedness of the Issuer.
- 14 -
Section 2.12. LIMITATIONS ON TRANSFER OF THE NOTES. The Notes
have not been and will not be registered under the Securities Act and will not
be listed on any exchange. No transfer of a Note shall be made unless such
transfer is made pursuant to an effective registration statement under the
Securities Act and all applicable state securities laws or is exempt from the
registration requirements under the Securities Act and such state securities
laws. In order to assure compliance with the Securities Act and state securities
laws, any transfer of a Note shall be made (a) in reliance on Rule 144A under
the Securities Act, in which case, the Indenture Trustee shall require that the
transferor deliver a certification substantially in the form of EXHIBIT B-1
hereto, or (b) to an institutional "accredited investor" within the meaning of
Rule 501(a)(1), (2), (3) or (7) of Regulation D under the Securities Act that is
not a "qualified institutional buyer," in which case the Indenture Trustee shall
require that the transferee deliver a certification substantially in the form of
EXHIBIT B-2 hereto. In the event of a transfer of a Note, other than pursuant to
an effective registration statement under the Securities Act and all applicable
state securities laws, the Indenture Trustee shall require that the transferee
deliver a certification substantially in the form of EXHIBIT B-3 hereto.
ARTICLE III
COVENANTS
Section 3.01. PAYMENT OF PRINCIPAL AND/OR INTEREST. The Issuer
will duly and punctually pay (or will cause to be paid duly and punctually) the
principal of and interest on the Notes in accordance with the terms of the Notes
and this Indenture. Without limiting the foregoing, subject to and in accordance
with SECTION 8.02(b) and (c) hereof, the Issuer will cause to be distributed all
amounts on deposit in the Collection Account and the Distribution Account on
each applicable Payment Date deposited therein pursuant to the Sale and
Servicing Agreement. Amounts properly withheld under the Code by any Person from
a payment to any Noteholder of interest and/or principal shall be considered as
having been paid by the Issuer to such Noteholder for all purposes of this
Indenture. The Notes shall be non-recourse obligations of the Issuer and shall
be limited in right of payment to amounts available from the Collateral, as
provided in this Indenture. The Issuer shall not otherwise be liable for
payments on the Notes. If any other provision of this Indenture shall be deemed
to conflict with the provisions of this SECTION 3.01, the provisions of this
SECTION 3.01 shall control.
Section 3.02. MAINTENANCE OF OFFICE OR AGENCY. The Indenture
Trustee shall maintain at the Corporate Trust Office an office or agency where
Notes may be surrendered for registration of transfer or exchange and where
notices and demands to or upon the Issuer in respect of the Notes and this
Indenture may be served. The Issuer hereby initially appoints the Indenture
Trustee to serve as its agent for the foregoing purposes and to serve as Paying
Agent with respect to the Notes. The Indenture Trustee shall give prompt written
notice to the Issuer of the location, and of any change in the location, of any
such office or agency.
Section 3.03. MONEY FOR PAYMENTS TO BE HELD IN TRUST. As
provided in SECTION 8.02(a) and (b) hereof, all payments of amounts due and
payable with respect to any Notes that are to be made from amounts withdrawn
from the Distribution Account pursuant to SECTION 8.02(c) hereof shall be made
on behalf of the Issuer by the Indenture Trustee or by the Paying
- 15 -
Agent, and no amounts so withdrawn from the Distribution Account for payments of
Notes shall be paid over to the Issuer except as provided in this SECTION 3.03.
Any Paying Agent (except the Administrator) shall be appointed
by Issuer Order with written notice thereof to the Indenture Trustee. Any Paying
Agent appointed by the Issuer shall be the Administrator or a Person which would
be eligible to be Indenture Trustee hereunder as provided in SECTION 6.11
hereof. The Issuer shall not appoint any Paying Agent (other than the Indenture
Trustee) which is not, at the time of such appointment, a Depository
Institution.
The Issuer will cause each Paying Agent other than the
Administrator and the Indenture Trustee to execute and deliver to the Indenture
Trustee an instrument in which such Paying Agent shall agree with the Indenture
Trustee (and if the Indenture Trustee acts as Paying Agent, it hereby so
agrees), subject to the provisions of this SECTION 3.03, that such Paying Agent
will:
(i) hold all sums held by it for the payment of amounts due
with respect to the Notes in trust for the benefit of the Persons
entitled thereto until such sums shall be paid to such Persons or
otherwise disposed of as herein provided and pay such sums to such
Persons as herein provided;
(ii) give the Indenture Trustee notice of any Default by the
Issuer (or any other obligor upon the Notes) of which it has actual
knowledge in the making of any payment required to be made with respect
to the Notes;
(iii) at any time during the continuance of any such Default,
upon the written request of the Indenture Trustee, forthwith pay to the
Indenture Trustee all sums so held in trust by such Paying Agent;
(iv) immediately resign as a Paying Agent and forthwith pay to
the Indenture Trustee all sums held by it in trust for the payment of
Notes if at any time it ceases to meet the standards required to be met
by a Paying Agent at the time of its appointment; and
(v) comply with all requirements of the Code with respect to
the withholding from any payments made by it on any Notes of any
applicable withholding taxes imposed thereon and with respect to any
applicable reporting requirements in connection therewith; provided,
however, that with respect to withholding and reporting requirements
applicable to original issue discount (if any) on the Notes, the Issuer
shall have first provided the calculations pertaining thereto to the
Indenture Trustee.
The Issuer may at any time, for the purpose of obtaining the
satisfaction and discharge of this Indenture or for any other purpose, by Issuer
Order direct any Paying Agent to pay to the Indenture Trustee all sums held in
trust by such Paying Agent, such sums to be held by the Indenture Trustee upon
the same trusts as those upon which the sums were held by such Paying Agent; and
upon such payment by any Paying Agent to the Indenture Trustee, such Paying
Agent shall be released from all further liability with respect to such money.
- 16 -
Subject to applicable laws with respect to escheat of funds or
abandoned property, any money held by the Indenture Trustee or any Paying Agent
in trust for the payment of any amount due with respect to any Note and
remaining unclaimed for two years after such amount has become due and payable
shall be discharged from such trust and be paid to the Issuer on Issuer Request;
and the Holder of such Note shall thereafter, as an unsecured general creditor,
look only to the Issuer for payment thereof (but only to the extent of the
amounts so paid to the Issuer), and all liability of the Indenture Trustee or
such Paying Agent with respect to such trust money shall thereupon cease;
provided, however, that the Indenture Trustee or such Paying Agent, before being
required to make any such repayment, shall at the expense and direction of the
Issuer cause to be published, once in a newspaper of general circulation in the
City of New York customarily published in the English language on each Business
Day, notice that such money remains unclaimed and that, after a date specified
therein, which shall not be less than 30 days from the date of such publication,
any unclaimed balance of such money then remaining will be repaid to the Issuer.
The Indenture Trustee shall also adopt and employ, at the expense and direction
of the Issuer, any other reasonable means of notification of such repayment
(including, but not limited to, mailing notice of such repayment to Noteholders
whose Notes have been called but have not been surrendered for redemption or
whose right to or interest in moneys due and payable but not claimed at the last
address of record for each such Noteholder determinable from the records of the
Indenture Trustee or of any Paying Agent.
Section 3.04. EXISTENCE. (a) Subject to subparagraph (b) of
this SECTION 3.04, the Issuer will keep in full effect its existence, rights and
franchises as a business trust under the laws of the State of Delaware (unless
it becomes, or any successor Issuer hereunder is or becomes, organized under the
laws of any other State or of the United States of America, in which case the
Issuer will keep in full effect its existence, rights and franchises under the
laws of such other jurisdiction) and will obtain and preserve its qualification
to do business in each jurisdiction in which such qualification is or shall be
necessary to protect the validity and enforceability of this Indenture, the
Notes and the Collateral.
(b) Any successor to the Owner Trustee appointed pursuant to
SECTION 10.2 of the Trust Agreement shall be the successor Owner Trustee under
this Indenture without the execution or filing of any paper, instrument or
further act to be done on the part of the parties hereto.
(c) Upon any consolidation or merger of or other succession to
the Owner Trustee, the Person succeeding to the Owner Trustee under the Trust
Agreement may exercise every right and power of the Owner Trustee under this
Indenture with the same effect as if such Person had been named as the Owner
Trustee herein.
Section 3.05. PROTECTION OF COLLATERAL. The Issuer will from
time to time execute and deliver all such reasonable supplements and amendments
hereto and all such financing statements, continuation statements, instruments
of further assurance and other instruments, and will take such other action
necessary or advisable to:
(i) provide further assurance with respect to the Grant of all
or any portion of the Collateral;
- 17 -
(ii) maintain or preserve the lien and security interest (and
the priority thereof) of this Indenture or carry out more effectively
the purposes hereof;
(iii) perfect, publish notice of or protect the validity of
any Grant made or to be made by this Indenture;
(iv) enforce any rights with respect to the Collateral; or
(v) preserve and defend title to the Collateral and the rights
of the Indenture Trustee and the Noteholders in such Collateral against
the claims of all Persons and parties.
The Issuer hereby designates the Administrator, its agent and
attorney-in-fact to execute any financing statement, continuation statement or
other instrument required to be executed pursuant to this SECTION 3.05.
Section 3.06. RESERVED.
Section 3.07. PERFORMANCE OF OBLIGATIONS; SERVICING OF LOANS.
(a) The Issuer will not take any action and will use its best
efforts not to permit any action to be taken by others that would release any
Person from any of such Person's material covenants or obligations under any
instrument or agreement included in the Collateral or that would result in the
amendment, hypothecation, subordination, termination or discharge of, or impair
the validity or effectiveness of, any such instrument or agreement, except as
expressly provided in the Basic Documents or such other instrument or agreement.
(b) The Issuer may contract with or otherwise obtain the
assistance of other Persons (including, without limitation, the Administrator
under the Administration Agreement) to assist it in performing its duties under
this Indenture, and any performance of such duties by a Person identified to the
Indenture Trustee in an Officer's Certificate of the Issuer shall be deemed to
be action taken by the Issuer. Initially, the Issuer has contracted with the
Servicer and the Administrator to assist the Issuer in performing its duties
under this Indenture.
(c) The Issuer will punctually perform and observe all of its
obligations and agreements contained in this Indenture, in the Basic Documents
and in the instruments and agreements included in the Collateral, including but
not limited to (i) filing or causing to be filed all UCC financing statements
and continuation statements required to be filed by the terms of this Indenture
and the Sale and Servicing Agreement and (ii) recording or causing to be
recorded all Mortgages, Assignments of Mortgage, all intervening Assignments of
Mortgage and all assumption and modification agreements required to be recorded
by the terms of the Sale and Servicing Agreement, in accordance with and within
the time periods provided for in this Indenture and/or the Sale and Servicing
Agreement, as applicable. Except as otherwise expressly provided therein, the
Issuer shall not waive, amend, modify, supplement or terminate any Basic
Document or any provision thereof without the consent of the Indenture Trustee
and the Majority Noteholders.
- 18 -
(d) If the Issuer shall have knowledge of the occurrence of a
Servicing Default, the Issuer shall promptly notify the Indenture Trustee and
the Majority Noteholders thereof, and shall specify in such notice the action,
if any, the Issuer is taking with respect to such default. If a Servicing
Default shall arise from the failure of the Servicer to perform any of its
duties or obligations under the Sale and Servicing Agreement with respect to the
Loans, the Issuer shall take all reasonable steps available to it to remedy such
failure.
(e) Reserved.
(f) Upon any termination of the Servicer's rights and powers
pursuant to the Sale and Servicing Agreement, the Issuer shall promptly notify
the Indenture Trustee. As soon as a successor servicer is appointed, the
Indenture Trustee shall notify the Issuer of such appointment, specifying in
such notice the name and address of such successor servicer.
(g) Without derogating from the absolute nature of the
assignment granted to the Indenture Trustee under this Indenture or the rights
of the Indenture Trustee hereunder, the Issuer agrees (i) that it will not,
without the prior written consent of the Indenture Trustee, amend, modify,
waive, supplement, terminate or surrender, or agree to any amendment,
modification, supplement, termination, waiver or surrender of, the terms of any
Collateral (except to the extent otherwise permitted by the Sale and Servicing
Agreement) or the Basic Documents, or waive timely performance or observance by
the Servicer or the Depositor under the Sale and Servicing Agreement; and (ii)
that any such amendment shall not (a) increase or reduce in any manner the
amount of, or accelerate or delay the timing of, distributions that are required
to be made for the benefit of the Noteholders or (b) reduce the aforesaid
percentage of the Notes that is required to consent to any such amendment,
without the consent of Noteholders evidencing 100% Percentage Interests of the
Outstanding Notes. If any such amendment, modification, supplement or waiver
shall so be consented to by the Indenture Trustee, the Issuer agrees, promptly
following a request by the Indenture Trustee to do so, to execute and deliver,
in its own name and at its own expense, such agreements, instruments, consents
and other documents as the Indenture Trustee may deem necessary or appropriate
in the circumstances.
Section 3.08. NEGATIVE COVENANTS. So long as any Notes are
Outstanding, the Issuer shall not:
(i) except as expressly permitted by the Basic Documents,
sell, transfer, exchange or otherwise dispose of any of the properties
or assets of the Issuer, including those included in the Collateral,
unless directed to do so by the Indenture Trustee;
(ii) claim any credit on, or make any deduction from the
principal or interest payable in respect of, the Notes (other than
amounts properly withheld from such payments under the Code) or assert
any claim against any present or former Noteholder by reason of the
payment of the taxes levied or assessed upon any part of the
Collateral;
(iii) engage in any business or activity other than as
expressly permitted by the Trust Agreement and the other Basic
Documents, other than in connection with, or relating to, the issuance
of Notes pursuant to this Indenture, or amend the Trust
- 19 -
Agreement as in effect on the Closing Date other than in accordance
with SECTION 11.1 thereof;
(iv) issue debt obligations under any other indenture;
(v) incur or assume any indebtedness or guaranty any
indebtedness of any Person, except for such indebtedness as may be
incurred by the Issuer in connection with the issuance of the Notes
pursuant to this Indenture;
(vi) dissolve or liquidate in whole or in part or merge or
consolidate with any other Person;
(vii) (a) permit the validity or effectiveness of this
Indenture to be impaired, or permit the lien of this Indenture to be
amended, hypothecated, subordinated, terminated or discharged, or
permit any Person to be released from any covenants or obligations with
respect to the Notes under this Indenture except as may expressly be
permitted hereby, (b) except as provided in the Basic Documents, permit
any lien, charge, excise, claim, security interest, mortgage or other
encumbrance (other than the lien of this Indenture) to be created on or
extend to or otherwise arise upon or burden the Collateral or any part
thereof or any interest therein or the proceeds thereof (other than tax
liens, mechanics' liens and other liens that arise by operation of law,
in each case on any of the Loan Collateral and arising solely as a
result of an action or omission of the related Obligors) or (c) permit
the lien of this Indenture not to constitute a valid first priority
(other than with respect to any such tax, mechanics' or other lien)
security interest in the Collateral;
(viii) remove the Administrator without the prior written
consent of the Majority Noteholders; or
(ix) take any other action or fail to take any action which
may cause the Issuer to be taxable as (a) an association pursuant to
Section 7701 of the Code and the corresponding regulations, other than
a REIT, as described in Section 856(a) of the Code, or a qualified REIT
subsidiary, as described in Section 856(i) of the Code, or (b) as a
taxable mortgage pool pursuant to Section 7701(i) of the Code and the
corresponding regulations that is not part of a REIT or a qualified
REIT subsidiary, as described in the previous clause.
Section 3.09. ANNUAL STATEMENT AS TO COMPLIANCE. The Issuer
will deliver to the Indenture Trustee, within 120 days after the end of each
fiscal year of the Issuer (commencing in the fiscal year 1998), an Officer's
Certificate stating, as to the Authorized Officer signing such Officer's
Certificate, that:
(i) a review of the activities of the Issuer during such year
and of its performance under this Indenture has been made under such
Authorized Officer's supervision; and
(ii) to the best of such Authorized Officer's knowledge, based
on such review, the Issuer has complied with all conditions and
covenants under this Indenture throughout
- 20 -
such year, or, if there has been a default in its compliance with any
such condition or covenant, specifying each such default known to such
Authorized Officer and the nature and status thereof.
Section 3.10. COVENANTS OF THE ISSUER. All covenants of the
Issuer in this Indenture are covenants of the Issuer and are not covenants of
the Owner Trustee. The Owner Trustee is, and any successor Owner Trustee under
the Trust Agreement will be, entering into this Indenture solely as Owner
Trustee under the Trust Agreement and not in its respective individual capacity,
and in no case whatsoever shall the Owner Trustee or any such successor Owner
Trustee be personally liable on, or for any loss in respect of, any of the
statements, representations, warranties or obligations of the Issuer hereunder,
as to all of which the parties hereto agree to look solely to the property of
the Issuer.
Section 3.11. SERVICER'S OBLIGATIONS. The Issuer shall cause
the Servicer to comply with the Sale and Servicing Agreement.
Section 3.12. RESTRICTED PAYMENTS. The Issuer shall not,
directly or indirectly, (i) pay any dividend or make any distribution (by
reduction of capital or otherwise), whether in cash, property, securities or a
combination thereof, to the Owner Trustee or any owner of a beneficial interest
in the Issuer or otherwise with respect to any ownership or equity interest or
security in or of the Issuer or to the Servicer, (ii) redeem, purchase, retire
or otherwise acquire for value any such ownership or equity interest or security
or (iii) set aside or otherwise segregate any amounts for any such purpose;
provided, however, that the Issuer may make, or cause to be made, (x)
distributions to the Servicer, the Indenture Trustee, the Owner Trustee, the
Noteholders and the holders of the Trust Certificates as contemplated by, and to
the extent funds are available for such purpose under, the Sale and Servicing
Agreement or the Trust Agreement and (y) payments to the Indenture Trustee
pursuant to SECTION 1(a)(ii) of the Administration Agreement. The Issuer will
not, directly or indirectly, make or cause to be made payments to or
distributions from the Distribution Account except in accordance with this
Indenture and the Basic Documents.
Section 3.13. TREATMENT OF NOTES AS DEBT FOR ALL PURPOSES. The
Issuer shall, and shall cause the Administrator to, treat the Notes as
indebtedness for all purposes.
Section 3.14. NOTICE OF EVENTS OF DEFAULT. The Issuer shall
give the Indenture Trustee and the Majority Noteholders prompt written notice of
each Event of Default hereunder, each default on the part of the Servicer or the
Loan Originator of its obligations under the Sale and Servicing Agreement and
each default on the part of the Loan Originator of its obligations under the
Loan Purchase Agreement.
Section 3.15. FURTHER INSTRUMENTS AND ACTS. Upon request of
the Indenture Trustee, the Issuer will execute and deliver such further
instruments and do such further acts as may be reasonably necessary or proper to
carry out more effectively the purpose of this Indenture.
- 21 -
ARTICLE IV
SATISFACTION AND DISCHARGE
Section 4.01. SATISFACTION AND DISCHARGE OF INDENTURE. This
Indenture shall cease to be of further effect with respect to the Notes (except
as to (i) rights of registration of transfer and exchange, (ii) substitution of
mutilated, destroyed, lost or stolen Notes, (iii) rights of Noteholders to
receive payments of principal thereof and interest thereon, (iv) SECTIONS 3.03,
3.04, 3.05, 3.08 and 3.10 hereof, (v) the rights, obligations and immunities of
the Indenture Trustee hereunder (including the rights of the Indenture Trustee
under SECTION 6.07 hereof and the obligations of the Indenture Trustee under
SECTION 4.02 hereof) and (vi) the rights of Noteholders as beneficiaries hereof
with respect to the property so deposited with the Indenture Trustee payable to
all or any of them), and the Indenture Trustee, on demand of and at the expense
of the Issuer, shall execute proper instruments satisfactory to it, and prepared
and delivered to it by the Issuer, acknowledging satisfaction and discharge of
this Indenture with respect to the Notes, when all of the following have
occurred:
(A) either
(1) all Notes theretofore authenticated and delivered
(other than (i) Notes that have been destroyed, lost or
stolen and that have been replaced or paid as provided
in SECTION 2.04 hereof and (ii) Notes for the payment
of which money has theretofore been deposited in trust
or segregated and held in trust by the Issuer and
thereafter repaid to the Issuer or discharged from such
trust, as provided in SECTION 3.03 hereof) shall have
been delivered to the Indenture Trustee for
cancellation; or
(2) all Notes not theretofore delivered to the Indenture
Trustee for cancellation
a. shall have become due and payable, or
b. are to be called for redemption within one year
under arrangements satisfactory to the Indenture
Trustee for the giving of notice of redemption
by the Indenture Trustee in the name, and at the
expense, of the Issuer,
c. and the Issuer, in the case of clause a. or b.
above, has irrevocably deposited or caused
irrevocably to be deposited with the Indenture
Trustee cash or direct obligations of or
obligations guaranteed by the United States of
America (which will mature prior to the date
such amounts are payable), in trust for such
purpose, in an amount sufficient to pay and
discharge the entire indebtedness on such Notes
not theretofore delivered to the Indenture
Trustee for
- 22 -
cancellation when due to the applicable Maturity
Date or the Redemption Date (if Notes shall have
been called for redemption pursuant to SECTION
10.01 hereof), as the case may be; and
(B) the latest of (a) 18 months after payment in full of all
outstanding obligations under the Notes, (b) the payment in full of all unpaid
Trust Fees and Expenses and (c) the date on which the Issuer has paid or caused
to be paid all other sums payable hereunder by the Issuer; and
(C) the Issuer shall have delivered to the Indenture Trustee
an Officer's Certificate and an Opinion of Counsel, each meeting the applicable
requirements of SECTION 11.01 hereof and, subject to SECTION 11.02 hereof, each
stating that all conditions precedent herein provided for, relating to the
satisfaction and discharge of this Indenture with respect to the Notes, have
been complied with.
Section 4.02. APPLICATION OF TRUST MONEY. All moneys deposited
with the Indenture Trustee pursuant to SECTIONS 3.03 AND 4.01 hereof shall be
held in trust and applied by it, in accordance with the provisions of the Notes
and this Indenture, to the payment, either directly or through any Paying Agent,
as the Indenture Trustee may determine, to the Noteholders for the payment or
redemption of which such moneys have been deposited with the Indenture Trustee,
of all sums due and to become due thereon for principal and/or interest; but
such moneys need not be segregated from other funds except to the extent
required herein or in the Sale and Servicing Agreement or required by law.
Section 4.03. REPAYMENT OF MONEYS HELD BY PAYING AGENT. In
connection with the satisfaction and discharge of this Indenture with respect to
the Notes, all moneys then held by any Paying Agent other than the Indenture
Trustee under the provisions of this Indenture with respect to such Notes shall,
upon demand of the Issuer, be paid to the Indenture Trustee to be held and
applied according to SECTION 3.03 hereof and thereupon such Paying Agent shall
be released from all further liability with respect to such moneys.
ARTICLE V
REMEDIES
Section 5.01. EVENTS OF DEFAULT. "Event of Default," wherever
used herein, means any one of the following events (whatever the reason for such
Event of Default and whether it shall be voluntary or involuntary or be effected
by operation of law or pursuant to any judgment, decree or order of any court or
any order, rule or regulation of any administrative or governmental body):
(a) notwithstanding any insufficiency of funds in the
Distribution Account for payment thereof on the related Payment Date, default in
the payment of any interest on any Note when the same becomes due and payable,
and continuance of such default for a period of five (5) days; or
- 23 -
(b) notwithstanding any insufficiency of funds in the
Distribution Account for payment thereof on the related Payment Date, default in
the payment of any installment of the Optimal Principal Payment Amount of any
Note (i) on any Payment Date or (ii) on the Maturity Date, or, to the extent
that there are funds available in the Distribution Account therefor, default in
the payment of any other installment of the principal of any Note when the same
becomes due and payable; or
(c) the occurrence of a Servicing Default; or
(d) default in the observance or performance of any covenant
or agreement of the Issuer made in any Basic Document to which it is a party
(other than a covenant or agreement, a default in the observance or performance
of which is elsewhere in this SECTION 5.01 specifically dealt with), or any
representation or warranty of the Issuer made in any Basic Document to which it
is a party or in any certificate or other writing delivered pursuant thereto or
in connection therewith proving to have been incorrect in any material respect
as of the time when the same shall have been made, and such default shall
continue or not be cured, or the circumstance or condition in respect of which
such misrepresentation or warranty was incorrect shall not have been eliminated
or otherwise cured, for a period of 30 days after there shall have been given,
by registered or certified mail, to the Issuer by the Indenture Trustee, or to
the Issuer, the Depositor and the Indenture Trustee by Noteholders evidencing at
least 25% Percentage Interests of the Outstanding Notes, a written notice
specifying such default or incorrect representation or warranty and requiring it
to be remedied and stating that such notice is a notice of Default hereunder; or
(e) default in the observance or performance of any covenant
or agreement of the Depositor made in any Basic Document to which it is a party
or any representation or warranty of the Depositor made in any Basic Document to
which it is a party, proving to have been incorrect in any material respect as
of the time when the same shall have been made, and such default shall continue
or not be cured, or the circumstance or condition in respect of which such
misrepresentation or warranty was incorrect shall not have been eliminated or
otherwise cured, for a period of 30 days after there shall have been given, by
registered or certified mail, to the Issuer and the Depositor by the Indenture
Trustee, or to the Issuer, the Depositor and the Indenture Trustee by
Noteholders evidencing at least 25% Percentage Interests of the Outstanding
Notes, a written notice specifying such Default or incorrect representation or
warranty and requiring it to be remedied and stating that such notice is a
notice of Default hereunder; or
(f) the filing of a decree or order for relief by a court
having jurisdiction over the Issuer or the Depositor or all or substantially all
of the Collateral in an involuntary case under any applicable federal or state
bankruptcy, insolvency or other similar law now or hereafter in effect, or the
appointing of a receiver, liquidator, assignee, custodian, trustee, sequestrator
or similar official of the Issuer or the Depositor or for all or substantially
all of the Collateral, or the ordering of the winding-up or liquidation of the
affairs of the Issuer or the Depositor, and such decree or order shall remain
unstayed and in effect for a period of 60 consecutive days; or
- 24 -
(g) the commencement by the Issuer or the Depositor of a
voluntary case under any applicable federal or state bankruptcy, insolvency or
other similar law now or hereafter in effect, or the consent by the Issuer or
the Depositor to the entry of an order for relief in an involuntary case under
any such law, or the consent by the Issuer to the appointment or taking
possession by a receiver, liquidator, assignee, custodian, trustee, sequestrator
or similar official of the Issuer or the Depositor or for any substantial part
of the Collateral, or the making by the Issuer or the Depositor of any general
assignment for the benefit of creditors, or the failure by the Issuer or the
Depositor generally to pay its respective debts as such debts become due, or the
taking of any action by the Issuer or the Depositor in furtherance of any of the
foregoing; or
(h) on any day after the Closing Date, the Unfunded Transfer
Obligation is equal to or less than two percent of the Pool Principal Balance.
The Issuer shall deliver to the Indenture Trustee, within five
days after the occurrence thereof, written notice in the form of an Officer's
Certificate of any event which with the giving of notice and the lapse of time
would become an Event of Default under clauses (d) or (e) above, the status of
such event and what action the Issuer or the Depositor, as applicable, is taking
or proposes to take with respect thereto.
Section 5.02. ACCELERATION OF MATURITY; RESCISSION AND
ANNULMENT. If an Event of Default should occur and be continuing, then and in
every such case the Indenture Trustee, at the direction or upon the prior
written consent of the Majority Noteholders, may declare all the Notes to be
immediately due and payable, by a notice in writing to the Issuer (and to the
Indenture Trustee if given by Noteholders), and upon any such declaration the
unpaid principal amount of such Notes, together with accrued and unpaid interest
thereon through the date of acceleration, shall become immediately due and
payable.
At any time after such declaration of acceleration of maturity
has been made and before a judgment or decree for payment of the moneys due has
been obtained by the Indenture Trustee as hereinafter in this ARTICLE V
provided, the Majority Noteholders, by written notice to the Issuer and the
Indenture Trustee, may rescind and annul such declaration and its consequences
if:
(a) the Issuer has paid or deposited with the Indenture
Trustee a sum sufficient to pay:
1. all payments of principal of and/or interest on all Notes and
all other amounts that would then be due hereunder or upon
such Notes if the Event of Default giving rise to such
acceleration had not occurred; and
2. all sums paid or advanced by the Indenture Trustee hereunder
and the reasonable compensation, expenses, disbursements and
advances of the Indenture Trustee and its agents and counsel;
and
(b) all Events of Default, other than the nonpayment of the
principal of the Notes that has become due solely by such acceleration, have
been cured or waived as provided in
- 25 -
SECTION 5.12 hereof. No such rescission shall affect any subsequent default or
impair any right consequent thereto.
Section 5.03. COLLECTION OF INDEBTEDNESS AND SUITS FOR
ENFORCEMENT BY INDENTURE TRUSTEE. (a) The Issuer covenants that if (i) default
is made in the payment of any interest on any Note when the same becomes due and
payable, and such default continues for a period of five days, or (ii) default
is made in the payment of the principal of or any installment of the principal
of any Note when the same becomes due and payable, the Issuer will, upon demand
of the Indenture Trustee, pay to the Indenture Trustee, for the benefit of the
Noteholders, the whole amount then due and payable on such Notes for principal
and/or interest, with interest upon the overdue principal and, to the extent
payment at such rate of interest shall be legally enforceable, upon overdue
installments of interest at the rate borne by the Notes and in addition thereto
such further amount as shall be sufficient to cover the costs and expenses of
collection, including the reasonable compensation, expenses, disbursements and
advances of the Indenture Trustee and its agents and counsel.
(b) In case the Issuer shall fail forthwith to pay such
amounts upon such demand, the Indenture Trustee shall at the direction of the
Majority Noteholders, subject to SECTION 5.06(C) institute a Proceeding for the
collection of the sums so due and unpaid, and may prosecute such Proceeding to
judgment or final decree, and may enforce the same against the Issuer or other
obligor upon such Notes and collect in the manner provided by law out of the
property of the Issuer or other obligor upon such Notes, wherever situated, the
moneys adjudged or decreed to be payable.
(c) If an Event of Default occurs and is continuing, the
Indenture Trustee shall at the direction of the Majority Noteholders, as more
particularly provided in SECTION 5.04 hereof, subject to SECTION 5.06(C) hereof,
proceed to protect and enforce its rights and the rights of the Noteholders by
such appropriate Proceedings as the Indenture Trustee shall deem most effective
to protect and enforce any such rights, whether for the specific enforcement of
any covenant or agreement in this Indenture or in aid of the exercise of any
power granted herein, or to enforce any other proper remedy or legal or
equitable right vested in the Indenture Trustee by this Indenture or by law.
(d) In case there shall be pending, relative to the Issuer or
any other obligor upon the Notes or any Person having or claiming an ownership
interest in the Collateral, Proceedings under Title 11 of the United States Code
or any other applicable federal or state bankruptcy, insolvency or other similar
law, or in case a receiver, assignee or trustee in bankruptcy or reorganization,
liquidator, sequestrator or similar official shall have been appointed for or
taken possession of the Issuer or its property or such other obligor or Person,
or in case of any other comparable judicial Proceedings relative to the Issuer
or other obligor upon the Notes, or to the creditors or property of the Issuer
or such other obligor, the Indenture Trustee, irrespective of whether the
principal of any Notes shall then be due and payable as therein expressed or by
declaration or otherwise and irrespective of whether the Indenture Trustee shall
have made any demand pursuant to the provisions of this SECTION 5.03, shall be
entitled and empowered by intervention in such Proceedings or otherwise:
- 26 -
(i) to file and prove a claim or claims for the whole amount
of principal and/or interest owing and unpaid in respect of the Notes
and to file such other papers or documents as may be necessary or
advisable in order to have the claims of the Indenture Trustee
(including any claim for reasonable compensation to the Indenture
Trustee, each predecessor Indenture Trustee, and its agents, attorneys
and counsel, and for reimbursement of all expenses and liabilities
incurred, and all advances made, by the Indenture Trustee and each
predecessor Indenture Trustee, except as a result of negligence or bad
faith) and of the Noteholders allowed in such Proceedings;
(ii) unless prohibited by applicable law and regulations, to
vote on behalf of the Noteholders in any election of a trustee, a
standby trustee or Person performing similar functions in any such
Proceedings;
(iii) to collect and receive any moneys or other property
payable or deliverable on any such claims and to distribute all amounts
received with respect to the claims of the Noteholders and the
Indenture Trustee on their behalf; and
(iv) to file such proofs of claim and other papers or
documents as may be necessary or advisable in order to have the claims
of the Indenture Trustee or the Noteholders allowed in any judicial
proceedings relative to the Issuer, its creditors and its property; and
any trustee, receiver, liquidator, custodian or other similar official
in any such Proceeding is hereby authorized by each of such Noteholders
to make payments to the Indenture Trustee and, in the event that the
Indenture Trustee shall consent to the making of payments directly to
such Noteholders, to pay to the Indenture Trustee such amounts as shall
be sufficient to cover reasonable compensation to the Indenture
Trustee, each predecessor Indenture Trustee and their respective
agents, attorneys and counsel, and all other expenses and liabilities
incurred and all advances made by the Indenture Trustee and each
predecessor Indenture Trustee except as a result of negligence or bad
faith.
(e) Nothing herein contained shall be deemed to authorize the
Indenture Trustee to authorize or consent to or vote for or accept or adopt on
behalf of any Noteholder any plan of reorganization, arrangement, adjustment or
composition affecting the Notes or the rights of any Holder thereof or to
authorize the Indenture Trustee to vote in respect of the claim of any
Noteholder in any such proceeding except, as aforesaid, to vote for the election
of a trustee in bankruptcy or similar Person.
(f) All rights of action and of asserting claims under this
Indenture, or under any of the Notes, may be enforced by the Indenture Trustee
without the possession of any of the Notes or the production thereof in any
trial or other Proceedings relative thereto, and any such action or Proceedings
instituted by the Indenture Trustee shall be brought in its own name as trustee
of an express trust, and any recovery of judgment, subject to the payment of the
expenses, disbursements and compensation of the Indenture Trustee, each
predecessor Indenture Trustee and their respective agents, attorneys and
counsel, shall be for the ratable benefit of the Noteholders.
- 27 -
(g) In any Proceedings brought by the Indenture Trustee (and
also any Proceedings involving the interpretation of any provision of this
Indenture to which the Indenture Trustee shall be a party), the Indenture
Trustee shall be held to represent all the Noteholders, and it shall not be
necessary to make any Noteholder a party to any such Proceedings.
Section 5.04. REMEDIES; PRIORITIES.
(a) If an Event of Default shall have occurred and be
continuing, the Indenture Trustee, at the direction of the Majority Noteholders
shall, do one or more of the following (subject to SECTION 5.05 hereof):
(i) institute Proceedings in its own name and as trustee of an
express trust for the collection of all amounts then payable on the
Notes or under this Indenture with respect thereto, whether by
declaration or otherwise, enforce any judgment obtained, and collect
from the Issuer and any other obligor upon such Notes moneys adjudged
due;
(ii) institute Proceedings from time to time for the complete
or partial foreclosure of this Indenture with respect to the
Collateral;
(iii) exercise any remedies of a secured party under the UCC
and take any other appropriate action to protect and enforce the rights
and remedies of the Indenture Trustee or the Noteholders; and
(iv) sell the Collateral or any portion thereof or rights or
interest therein in a commercially reasonable manner, at one or more
public or private sales called and conducted in any manner permitted by
law; provided, however, that the Indenture Trustee may not sell or
otherwise liquidate the Collateral following an Event of Default,
unless the Holders of 100% Percentage Interests of the Outstanding
Notes consent thereto, (B) the proceeds of such sale or liquidation
distributable to the Noteholders are sufficient to discharge in full
all amounts then due and unpaid upon such Notes for principal and/or
interest or (C) the Indenture Trustee determines that the Collateral
will not continue to provide sufficient funds for the payment of
principal of and interest on the Notes as they would have become due if
the Notes had not been declared due and payable, and the Indenture
Trustee obtains the consent of Holders of not less than 66-2/3%
Percentage Interests of the Outstanding Notes. In determining such
sufficiency or insufficiency with respect to clause (B) and (C) of this
subsection (a)(iv), the Indenture Trustee may, but need not, obtain and
rely upon an opinion of an Independent investment banking or accounting
firm of national reputation as to the feasibility of such proposed
action and as to the sufficiency of the Collateral for such purpose.
(b) If the Indenture Trustee collects any money or property
pursuant to this ARTICLE V, it shall pay out the money or property in the
following order:
FIRST: in the following order of priority: (a) to the
Indenture Trustee, an amount equal to all unreimbursed Indenture
Trustee Fees and indemnities and any other amounts payable to the
Indenture Trustee pursuant to the Basic Documents and to the Indenture
- 28 -
Trustee or Sale Agents, as applicable, all reasonable fees and expenses
incurred by them and their agents and representatives in connection
with the enforcement of the remedies provided for in this Article V,
(b) to the Custodian, an amount equal to all unpaid Custodian Fees and
indemnities and any other amounts payable to the Custodian pursuant to
the Basic Documents, (c) to the Servicer, but only if the Servicer is
not FFCA or any Affiliate thereof, an amount equal to (i) all
unreimbursed Servicing Compensation and (ii) all unreimbursed
Nonrecoverable Servicing Advances, and (d) to the Servicer, in trust
for the Owner Trustee, an amount equal to the Owner Trustee Fee and all
unpaid Owner Trustee Fees;
SECOND: to distribute on a Payment Date, the Hedge Funding
Requirement to the appropriate Hedging Counterparties; provided, that
only cash on or in respect of fixed rate Loans (including cash
Securitization Proceeds received therefrom) shall be distributed for
such purpose and; provided, further, that amounts distributed pursuant
to clause FIRST above shall be deemed paid from Loans bearing a fixed
Loan Interest Rate, pro rata based on their aggregate Principal
Balances relative to the Pool Principal Balance on such Payment Date;
THIRD: to the Noteholders pro rata, all amounts in respect of
interest due and owing under the Notes;
FOURTH: to the Noteholders pro rata, all amounts in respect of
unpaid principal of the Notes;
FIFTH: to the Servicer if the Servicer is the Loan Originator
or an Affiliate thereof, an amount equal to any unreimbursed Servicing
Compensation; and
SIXTH: to the Owner Trustee, for any amounts to be distributed
pro rata to the holders of the Trust Certificates pursuant to the Trust
Agreement.
The Indenture Trustee may fix a record date and payment date
for any payment to be made to the Noteholders pursuant to this SECTION 5.04. At
least 15 days before such record date, the Indenture Trustee shall mail to each
Noteholder and the Issuer a notice that states the record date, the payment date
and the amount to be paid.
Section 5.05. OPTIONAL PRESERVATION OF THE COLLATERAL. If the
Notes have been declared to be due and payable under SECTION 5.02 hereof
following an Event of Default and such declaration and its consequences have not
been rescinded and annulled, the Indenture Trustee may, but need not, elect to
maintain possession of the Collateral. It is the desire of the parties hereto
and the Noteholders that there be at all times sufficient funds for the payment
of principal of and interest on the Notes, and the Indenture Trustee shall take
such desire into account when determining whether or not to maintain possession
of the Collateral. In determining whether to maintain possession of the
Collateral, the Indenture Trustee may, but need not, obtain and rely upon an
opinion of an Independent investment banking or accounting firm of national
reputation as to the feasibility of such proposed action and as to the
sufficiency of the Collateral for such purpose.
- 29 -
Section 5.06. LIMITATION OF SUITS. No Noteholder shall have
any right to institute any Proceeding, judicial or otherwise, with respect to
this Indenture or for the appointment of a receiver or trustee, or for any other
remedy hereunder, unless:
(a) such Noteholder has previously given written notice to the
Indenture Trustee of a continuing Event of Default;
(b) the Noteholders evidencing not less than 25% Percentage
Interests of the Outstanding Notes have made written request to the
Indenture Trustee to institute such Proceeding in respect of such Event
of Default in its own name as Indenture Trustee hereunder;
(c) such Noteholder or Noteholders have offered to the
Indenture Trustee reasonable indemnity against the costs, expenses and
liabilities to be incurred in complying with such request;
(d) the Indenture Trustee for 30 days after its receipt of
such notice, request and offer of indemnity has failed to institute
such Proceeding; and
(e) no direction inconsistent with such written request has
been given to the Indenture Trustee during such 30-day period by the
Majority Noteholders.
It is understood and intended that no one or more Noteholders
shall have any right in any manner whatever by virtue of, or by availing of, any
provision of this Indenture to affect, disturb or prejudice the rights of any
other Noteholders or to obtain or to seek to obtain priority or preference over
any other Noteholders or to enforce any right under this Indenture, except in
the manner herein provided.
In the event the Indenture Trustee shall receive conflicting
or inconsistent requests and indemnity from two or more groups of Noteholders,
neither of which evidences Percentage Interests of the Outstanding Notes greater
than 50%, the Indenture Trustee in its sole discretion may determine what
action, if any, shall be taken, notwithstanding any other provisions of this
Indenture and shall have no obligation or liability to any such group of
Noteholders for such action or inaction.
Section 5.07. UNCONDITIONAL RIGHTS OF NOTEHOLDERS TO RECEIVE
PRINCIPAL AND/OR INTEREST. Notwithstanding any other provisions in this
Indenture, any Noteholder shall have the right, which is absolute and
unconditional, to receive payment of the principal of and interest, if any, on
such Note on or after the applicable Maturity Date thereof expressed in such
Note or in this Indenture (or, in the case of redemption, on or after the
Redemption Date) and to institute suit for the enforcement of any such payment,
and such right shall not be impaired without the consent of such Noteholder.
Section 5.08. RESTORATION OF RIGHTS AND REMEDIES. If the
Indenture Trustee or any Noteholder has instituted any Proceeding to enforce any
right or remedy under this Indenture and such Proceeding has been discontinued
or abandoned for any reason or has been determined adversely to the Indenture
Trustee or to such Noteholder, then and in every such case the Issuer,
- 30 -
the Indenture Trustee and the Noteholders shall, subject to any determination in
such Proceeding, be restored severally and respectively to their former
positions hereunder, and thereafter all rights and remedies of the Indenture
Trustee and the Noteholders shall continue as though no such Proceeding had been
instituted.
Section 5.09. RIGHTS AND REMEDIES CUMULATIVE. No right or
remedy herein conferred upon or reserved to the Indenture Trustee or to the
Noteholders is intended to be exclusive of any other right or remedy, and every
right and remedy shall, to the extent permitted by law, be cumulative and in
addition to every other right and remedy given hereunder or now or hereafter
existing at law or in equity or otherwise. The assertion or employment of any
right or remedy hereunder, or otherwise, shall not prevent the concurrent
assertion or employment of any other appropriate right or remedy.
Section 5.10. DELAY OR OMISSION NOT A WAIVER. No delay or
omission of the Indenture Trustee or any Noteholder to exercise any right or
remedy accruing upon any Default or Event of Default shall impair any such right
or remedy or constitute a waiver of any such Default or Event of Default or an
acquiescence therein. Every right and remedy given by this Article V or by law
to the Indenture Trustee or to the Noteholders may be exercised from time to
time, and as often as may be deemed expedient, by the Indenture Trustee or by
the Noteholders, as the case may be.
Section 5.11. CONTROL BY NOTEHOLDERS. The Majority Noteholders
shall have the right to direct the time, method and place of conducting any
Proceeding for any remedy available to the Indenture Trustee with respect to the
Notes or exercising any trust or power conferred on the Indenture Trustee;
provided, however, that:
(a) such direction shall not be in conflict with any rule of
law or with this Indenture;
(b) subject to the express terms of SECTION 5.04(a)(iv)
hereof, any direction to the Indenture Trustee to sell or liquidate the
Collateral shall be by Holders of Notes representing Percentage
Interests of the Outstanding Notes of not less than 100%;
(c) if the conditions set forth in SECTION 5.05 hereof have
been satisfied and the Indenture Trustee elects to retain the
Collateral pursuant to such Section, then any direction to the
Indenture Trustee by Holders of Notes representing Percentage Interests
of the Outstanding Notes of less than 100% to sell or liquidate the
Collateral shall be of no force and effect; and
(d) the Indenture Trustee may take any other action deemed
proper by the Indenture Trustee that is not inconsistent with such
direction.
In connection with any sale of the Collateral in accordance
with paragraph (c) above, the Majority Noteholders may, in their sole discretion
appoint agents to effect the sale of the Collateral (such agents, "Sale
Agents"), which Sale Agents may be Affiliates of any
- 31 -
Noteholder. The Sale Agents shall be entitled to reasonable compensation in
connection with such activities from the proceeds of such sale.
Notwithstanding the rights of the Noteholders set forth in
this SECTION 5.11, subject to SECTION 6.01 hereof, the Indenture Trustee need
not take any action that it determines might involve it in liability or might
materially adversely affect the rights of any Noteholders not consenting to such
action.
Section 5.12. WAIVER OF PAST DEFAULTS. The Majority
Noteholders may waive any past Default or Event of Default and its consequences,
except a Default (a) in the payment of principal of or interest on any of the
Notes or (b) in respect of a covenant or provision hereof that cannot be
modified or amended without the consent of each Noteholder. In the case of any
such waiver, the Issuer, the Indenture Trustee and Noteholders shall be restored
to their former positions and rights hereunder, respectively; but no such waiver
shall extend to any subsequent or other Default or impair any right consequent
thereto.
Upon any such waiver, such Default shall cease to exist and be
deemed to have been cured and not to have occurred, and any Event of Default
arising therefrom shall be deemed to have been cured and not to have occurred,
for every purpose of this Indenture; but no such waiver shall extend to any
subsequent or other Default or Event of Default or impair any right consequent
thereto.
Section 5.13. UNDERTAKING FOR COSTS. All parties to this
Indenture agree, and each Noteholder by such Noteholder's acceptance thereof
shall be deemed to have agreed, that any court may in its discretion require, in
any suit for the enforcement of any right or remedy under this Indenture, or in
any suit against the Indenture Trustee for any action taken, suffered or omitted
by it as Indenture Trustee, the filing by any party litigant in such suit of an
undertaking to pay the costs of such suit, and that such court may in its
discretion assess reasonable costs, including reasonable attorneys' fees,
against any party litigant in such suit, having due regard to the merits and
good faith of the claims or defenses made by such party litigant; but the
provisions of this SECTION 5.13 shall not apply to (a) any suit instituted by
the Indenture Trustee, (b) any suit instituted by any Noteholder, or group of
Noteholders, in each case holding in the aggregate Percentage Interests of the
Outstanding Notes of more than 10% or (c) any suit instituted by any Noteholder
for the enforcement of the payment of principal of or interest on any Note on or
after the respective due dates expressed in such Note and in this Indenture (or,
in the case of redemption, on or after the Redemption Date).
Section 5.14. WAIVER OF STAY OR EXTENSION LAWS. The Issuer
covenants (to the extent that it may lawfully do so) that it will not at any
time insist upon, or plead or in any manner whatsoever, claim or take the
benefit or advantage of, any stay or extension law wherever enacted, now or at
any time hereafter in force, that may affect the covenants or the performance of
this Indenture; and the Issuer (to the extent that it may lawfully do so) hereby
expressly waives all benefit or advantage of any such law, and covenants that it
will not hinder, delay or impede the execution of any power herein granted to
the Indenture Trustee, but will suffer and permit the execution of every such
power as though no such law had been enacted.
- 32 -
Section 5.15. ACTION ON NOTES. The Indenture Trustee's right
to seek and recover judgment on the Notes or under this Indenture shall not be
affected by the seeking, obtaining or application of any other relief under or
with respect to this Indenture. Neither the lien of this Indenture nor any
rights or remedies of the Indenture Trustee or the Noteholders shall be impaired
by the recovery of any judgment by the Indenture Trustee against the Issuer or
by the levy of any execution under such judgment upon any portion of the
Collateral or upon any of the assets of the Issuer. Any money or property
collected by the Indenture Trustee shall be applied in accordance with SECTION
5.04(B) hereof.
Section 5.16. PERFORMANCE AND ENFORCEMENT OF CERTAIN
OBLIGATIONS.
(a) Promptly following a request from the Indenture Trustee to
do so and at the Administrator's expense, the Issuer shall take all such lawful
action as the Indenture Trustee may request to compel or secure the performance
and observance by the Loan Originator and the Servicer, as applicable, of each
of their obligations to the Issuer under or in connection with the Sale and
Servicing Agreement, and to exercise any and all rights, remedies, powers and
privileges lawfully available to the Issuer under or in connection with the Sale
and Servicing Agreement to the extent and in the manner directed by the
Indenture Trustee, including the transmission of notices of default on the part
of the Loan Originator or the Servicer thereunder and the institution of legal
or administrative actions or proceedings to compel or secure performance by the
Loan Originator or the Servicer of each of their obligations under the Sale and
Servicing Agreement.
(b) If an Event of Default has occurred and is continuing, the
Indenture Trustee may, and at the direction (which direction shall be in writing
or by telephone, confirmed in writing promptly thereafter) of the Majority
Noteholders shall, subject to SECTION 5.06(c) exercise all rights, remedies,
powers, privileges and claims of the Issuer against the Loan Originator or the
Servicer under or in connection with the Sale and Servicing Agreement, including
the right or power to take any action to compel or secure performance or
observance by the Loan Originator or the Servicer, as the case may be, of each
of their obligations to the Issuer thereunder and to give any consent, request,
notice, direction, approval, extension, or waiver under the Sale and Servicing
Agreement, and any right of the Issuer to take such action shall be suspended.
ARTICLE VI
THE INDENTURE TRUSTEE
Section 6.01. DUTIES OF INDENTURE TRUSTEE. (a) If an Event of
Default has occurred and is continuing, the Indenture Trustee shall exercise the
rights and powers vested in it by this Indenture and use the same degree of care
and skill in their exercise as a prudent person would exercise or use under the
circumstances in the conduct of such person's own affairs.
(b) Except during the continuance of an Event of Default:
- 33 -
(i) the Indenture Trustee shall undertake to perform such
duties and only such duties as are specifically set forth in this
Indenture and no implied covenants or obligations shall be read into
this Indenture against the Indenture Trustee; and
(ii) in the absence of bad faith on its part, the Indenture
Trustee may conclusively rely, as to the truth of the statements and
the correctness of the opinions expressed therein, upon certificates or
opinions furnished to the Indenture Trustee and conforming to the
requirements of this Indenture; provided, however, that the Indenture
Trustee shall examine the certificates and opinions to determine
whether or not they conform to the requirements of this Indenture to
the extent specifically set forth herein.
(c) The Indenture Trustee may not be relieved from liability
for its own negligent action, its own negligent failure to act or its own
willful misconduct, except that:
(i) this paragraph does not limit the effect of paragraph (b)
of this SECTION 6.01;
(ii) the Indenture Trustee shall not be liable for any error
of judgment made in good faith by a Responsible Officer unless it is
proved that the Indenture Trustee was negligent in ascertaining the
pertinent facts; and
(iii) the Indenture Trustee shall not be liable with respect
to any action it takes or omits to take in good faith in accordance
with a direction received by it pursuant to SECTION 5.11 hereof.
(d) Every provision of this Indenture that in any way relates
to the Indenture Trustee is subject to paragraphs (a), (b), (c) and (g) of this
SECTION 6.01.
(e) The Indenture Trustee shall not be liable for interest on
any money received by it and held in a Trust Account except as may be provided
in the Sale and Servicing Agreement or as the Indenture Trustee may agree in
writing with the Issuer.
(f) Money held in trust by the Indenture Trustee shall be
segregated from other funds except to the extent permitted by law or the terms
of this Indenture or the Sale and Servicing Agreement.
(g) No provision of this Indenture shall require the Indenture
Trustee to expend or risk its own funds or otherwise incur financial liability
in the performance of any of its duties hereunder or in the exercise of any of
its rights or powers, if it shall have reasonable grounds to believe that
repayment of such funds or adequate indemnity against such risk or liability is
not reasonably assured to it; provided, however, that the Indenture Trustee
shall not refuse or fail to perform any of its duties hereunder solely as a
result of nonpayment of its normal fees and expenses and provided, further, that
nothing in this SECTION 6.01(g) shall be construed to limit the exercise by the
Indenture Trustee of any right or remedy permitted under this Indenture or
otherwise in the event of the Issuer's failure to pay the Indenture Trustee's
fees and expenses pursuant to SECTION 6.07 hereof. In determining that such
repayment or indemnity is not reasonably assured to it, the Indenture Trustee
must consider not only the likelihood of
- 34 -
repayment or indemnity by or on behalf of the Issuer but also the likelihood of
repayment or indemnity from amounts payable to it from the Collateral pursuant
to SECTION 6.07 hereof.
(h) Every provision of this Indenture relating to the conduct
or affecting the liability of or affording protection to the Indenture Trustee
shall be subject to the provisions of this SECTION 6.01.
(i) The Indenture Trustee shall not be required to take notice
or be deemed to have notice or knowledge of any Event of Default (other than an
Event of Default pursuant to SECTION 5.01(a) or (b) hereof) unless a Responsible
Officer of the Indenture Trustee shall have received written notice thereof or
otherwise shall have actual knowledge thereof. In the absence of receipt of
notice or such knowledge, the Indenture Trustee may conclusively assume that
there is no Event of Default.
Section 6.02. RIGHTS OF INDENTURE TRUSTEE.
(a) The Indenture Trustee may rely on any document believed by
it to be genuine and to have been signed or presented by the proper person. The
Indenture Trustee need not investigate any fact or matter stated in the
document.
(b) Before the Indenture Trustee acts or refrains from acting,
it may require an Officer's Certificate or an Opinion of Counsel. The Indenture
Trustee shall not be liable for any action it takes or omits to take in good
faith in reliance on an Officer's Certificate or Opinion of Counsel.
(c) The Indenture Trustee may execute any of the trusts or
powers hereunder or perform any duties hereunder either directly or by or
through agents or attorneys or a custodian or nominee.
(d) The Indenture Trustee shall not be liable for (i) any
action it takes or omits to take in good faith which it believes to be
authorized or within its rights or powers; provided, however, that such action
or omission by the Indenture Trustee does not constitute willful misconduct,
negligence or bad faith; or (ii) any action or inaction on the part of the
Custodian.
(e) The Indenture Trustee may consult with counsel, and the
advice or opinion of counsel with respect to legal matters relating to this
Indenture and the Notes shall be full and complete authorization and protection
from liability in respect to any action taken, omitted or suffered by it
hereunder in good faith and in accordance with the advice or opinion of such
counsel.
Section 6.03. INDIVIDUAL RIGHTS OF INDENTURE TRUSTEE. The
Indenture Trustee in its individual or any other capacity may become the owner
or pledgee of Notes and may otherwise deal with the Issuer or its Affiliates
with the same rights it would have if it were not Indenture Trustee. Any Paying
Agent, Note Registrar, co-registrar or co-paying agent may do the same with like
rights. However, the Indenture Trustee must comply with SECTION 6.11 hereof.
- 35 -
Section 6.04. INDENTURE TRUSTEE'S DISCLAIMER. The Indenture
Trustee shall not be responsible for and makes no representation as to the
validity or adequacy of this Indenture or the Notes, shall not be accountable
for the Issuer's use of the proceeds from the Notes, or responsible for any
statement of the Issuer in the Indenture or in any document issued in connection
with the sale of the Notes or in the Notes other than the Indenture Trustee's
certificate of authentication.
Section 6.05. NOTICES OF DEFAULT. If a Default occurs and is
continuing and if it is actually known to a Responsible Officer of the Indenture
Trustee, the Indenture Trustee shall mail to each Noteholder notice of the
Default within 90 days after it occurs.
Section 6.06. REPORTS BY INDENTURE TRUSTEE TO HOLDERS. The
Indenture Trustee shall deliver to each Noteholder such information in the
Indenture Trustee's possession and as may be reasonably required to enable such
Noteholder to prepare its federal and state income tax returns.
Section 6.07. COMPENSATION AND INDEMNITY. As compensation for
its services hereunder, the Indenture Trustee shall be entitled to receive, on
each Payment Date, the Indenture Trustee's Fee pursuant to SECTION 8.02(c)
hereof (which compensation shall not be limited by any law on compensation of a
trustee of an express trust) and shall be entitled to reimbursement by the
Servicer for all reasonable out-of-pocket expenses incurred or made by it,
including costs of collection, in addition to the compensation for its services.
Such expenses shall include the reasonable compensation and expenses,
disbursements and advances of the Indenture Trustee's agents, counsel,
accountants and experts. The Issuer agrees to cause the Servicer to indemnify
the Indenture Trustee against any and all loss, liability or expense (including
reasonable attorneys' fees) incurred by it in connection with the administration
of this trust and the performance of its duties hereunder. The Indenture Trustee
shall notify the Issuer and the Servicer promptly of any claim for which it may
seek indemnity. Failure by the Indenture Trustee so to notify the Issuer and the
Servicer shall not relieve the Issuer of its obligations hereunder. The Issuer
shall or shall cause the Servicer to defend any such claim; provided, however,
that if the defendants with respect to any such claim include the Issuer and/or
the Servicer and the Indenture Trustee, and the Indenture Trustee shall have
reasonably concluded that there may be legal defenses available to it which are
different from or in addition to those defenses available to the Issuer or the
Servicer, as the case may be, the Indenture Trustee shall have the right, at the
expense of the Servicer, to select separate counsel to assert such legal
defenses and to otherwise defend itself against such claim. Neither the Issuer
nor the Servicer need reimburse any expense or indemnify against any loss,
liability or expense incurred by the Indenture Trustee through the Indenture
Trustee's own willful misconduct, negligence or bad faith.
The Issuer's payment obligations to the Indenture Trustee
pursuant to this SECTION 6.07 shall survive the discharge of this Indenture and
the termination or resignation of the Indenture Trustee. When the Indenture
Trustee incurs expenses after the occurrence of a Default specified in SECTION
5.01(f), or (g) hereof with respect to the Issuer, the expenses are intended to
constitute expenses of administration under Title 11 of the United States Code
or any other applicable federal or state bankruptcy, insolvency or similar law.
- 36 -
Section 6.08. REPLACEMENT OF INDENTURE TRUSTEE. No resignation
or removal of the Indenture Trustee and no appointment of a successor Indenture
Trustee shall become effective until the acceptance of appointment by the
successor Indenture Trustee pursuant to this SECTION 6.08. The Indenture Trustee
may resign at any time by so notifying the Issuer. The Majority Noteholders may
remove the Indenture Trustee by so notifying the Indenture Trustee and may
appoint a successor Indenture Trustee; provided, that all of the reasonable
costs and expenses incurred by the Indenture Trustee in connection with such
removal shall be reimbursed to it prior to the effectiveness of such removal.
The Issuer shall remove the Indenture Trustee if:
(a) the Indenture Trustee fails to comply with SECTION
6.11 hereof;
(b) the Indenture Trustee is adjudged a bankrupt or
insolvent;
(c) a receiver or other public officer takes charge of
the Indenture Trustee or its property; or
(d) the Indenture Trustee otherwise becomes incapable of
acting.
If the Indenture Trustee resigns or is removed or if a vacancy
exists in the office of Indenture Trustee for any reason (the Indenture Trustee
in such event being referred to herein as the retiring Indenture Trustee), the
Issuer shall promptly appoint a successor Indenture Trustee.
A successor Indenture Trustee shall deliver a written
acceptance of its appointment to the retiring Indenture Trustee and to the
Issuer. Thereupon the resignation or removal of the retiring Indenture Trustee
shall become effective, and the successor Indenture Trustee shall have all the
rights, powers and duties of the Indenture Trustee under this Indenture. The
successor Indenture Trustee shall mail a notice of its succession to
Noteholders. The retiring Indenture Trustee shall promptly transfer all property
held by it as Indenture Trustee to the successor Indenture Trustee.
If a successor Indenture Trustee does not take office within
60 days after the retiring Indenture Trustee resigns or is removed, the retiring
Indenture Trustee, the Issuer or the Majority Noteholders may petition any court
of competent jurisdiction for the appointment of a successor Indenture Trustee.
If the Indenture Trustee fails to comply with SECTION 6.11
hereof, any Noteholder may petition any court of competent jurisdiction for the
removal of the Indenture Trustee and the appointment of a successor Indenture
Trustee.
Notwithstanding the replacement of the Indenture Trustee
pursuant to this SECTION 6.08, the Issuer's and the Administrator's obligations
under SECTION 6.07 hereof shall continue for the benefit of the retiring
Indenture Trustee.
Section 6.09. SUCCESSOR INDENTURE TRUSTEE BY MERGER. If the
Indenture Trustee consolidates with, merges or converts into, or transfers all
or substantially all its corporate trust business or assets to, another
corporation or banking association, the resulting, surviving or
- 37 -
transferee corporation without any further act shall be the successor Indenture
Trustee; provided, however, that such corporation or banking association shall
otherwise be qualified and eligible under SECTION 6.11 hereof. The Indenture
Trustee shall provide the Majority Noteholders prior written notice of any such
transaction.
In case at the time such successor or successors by merger,
conversion or consolidation to the Indenture Trustee shall succeed to the trusts
created by this Indenture any of the Notes shall have been authenticated but not
delivered, any such successor to the Indenture Trustee may adopt the certificate
of authentication of any predecessor trustee, and deliver such Notes so
authenticated; and in case at that time any of the Notes shall not have been
authenticated, any successor to the Indenture Trustee may authenticate such
Notes either in the name of any predecessor hereunder or in the name of the
successor to the Indenture Trustee; and in all such cases such certificates
shall have the full force which it is anywhere in the Notes or in this Indenture
provided that the certificate of the Indenture Trustee shall have.
Section 6.10. APPOINTMENT OF CO-INDENTURE TRUSTEE OR SEPARATE
INDENTURE TRUSTEE. (a) Notwithstanding any other provisions of this Indenture,
at any time, for the purpose of meeting any legal requirement of any
jurisdiction in which any part of the Collateral may at the time be located, the
Indenture Trustee shall have the power and may execute and deliver all
instruments to appoint one or more Persons to act as a co-trustee or
co-trustees, or separate trustee or separate trustees, of all or any part of the
Trust, and to vest in such Person or Persons, in such capacity and for the
benefit of the Noteholders, such title to the Collateral, or any part hereof,
and, subject to the other provisions of this SECTION 6.10, such powers, duties,
obligations, rights and trusts as the Indenture Trustee may consider necessary
or desirable. No co-trustee or separate trustee hereunder shall be required to
meet the terms of eligibility as a successor trustee under SECTION 6.11 hereof
and no notice to Noteholders of the appointment of any co-trustee or separate
trustee shall be required under SECTION 6.08 hereof.
(b) Every separate trustee and co-trustee shall, to the extent
permitted by law, be appointed and act subject to the following provisions and
conditions:
(i) all rights, powers, duties and obligations conferred or
imposed upon the Indenture Trustee shall be conferred or imposed upon
and exercised or performed by the Indenture 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
Indenture 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 Indenture 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 Collateral 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 Indenture Trustee;
(ii) no trustee hereunder shall be personally liable by reason
of any act or omission of any other trustee hereunder; and
- 38 -
(iii) the Indenture Trustee may at any time accept the
resignation of or remove any separate trustee or co-trustee.
(c) Any notice, request or other writing given to the
Indenture 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 VI. 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, jointly with
the Indenture Trustee, subject to all the provisions of this Indenture,
specifically including every provision of this Indenture relating to the conduct
of, affecting the liability of, or affording protection to, the Indenture
Trustee. Every such instrument shall be filed with the Indenture Trustee.
(d) Any separate trustee or co-trustee may at any time
constitute the Indenture Trustee 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 Indenture Trustee, to the extent permitted by law,
without the appointment of a new or successor trustee.
Section 6.11. ELIGIBILITY. The Indenture Trustee shall (i)
have a combined capital and surplus of at least $50,000,000 as set forth in its
most recent published annual report of condition or (ii) otherwise be acceptable
in writing to the Majority Noteholders.
ARTICLE VII
NOTEHOLDERS' LISTS AND REPORTS
Section 7.01. ISSUER TO FURNISH INDENTURE TRUSTEE NAMES AND
ADDRESSES OF NOTEHOLDERS. The Issuer will furnish or cause to be furnished to
the Indenture Trustee (a) not more than five days after the earlier of (i) each
Record Date and (ii) three months after the last Record Date, a list, in such
form as the Indenture Trustee may reasonably require, of the names and addresses
of the Noteholders as of such Record Date, (b) at such other times as the
Indenture Trustee may request in writing, within 30 days after receipt by the
Issuer of any such request, a list of similar form and content as of a date not
more than 10 days prior to the time such list is furnished; provided, however,
that so long as the Indenture Trustee is the Note Registrar, no such list shall
be required to be furnished.
Section 7.02. PRESERVATION OF INFORMATION. The Indenture
Trustee shall preserve, in as current a form as is reasonably practicable, the
names and addresses of the Noteholders contained in the most recent list
furnished to the Indenture Trustee as provided in SECTION 7.01 hereof and the
names and addresses of Noteholders received by the Indenture Trustee in its
capacity as Note Registrar. The Indenture Trustee may destroy any list furnished
to it as provided in such SECTION 7.01 upon receipt of a new list so furnished.
- 39 -
Section 7.03. 144A INFORMATION. The Indenture Trustee, to the
extent it has any such information in its possession, shall provide to any
Noteholder and any prospective transferee designated by any such Noteholder
information regarding the Notes and the Loans and such other information as
shall be necessary to satisfy the condition to eligibility set forth in Rule
144A(d)(4) under the Securities Act for transfer of any such Note without
registration thereof under the Securities Act pursuant to the registration
exemption provided by Rule 144A under the Securities Act. Each Noteholder
desiring to effect such a transfer shall, and does hereby agree to, indemnify
the Issuer, the Owner Trustee, the Indenture Trustee and the Depositor against
any liability that may result from its gross negligence or willful misconduct in
the event that the transfer is not so exempt or is not made in accordance with
federal and state securities laws.
ARTICLE VIII
ACCOUNTS, DISBURSEMENTS AND RELEASES
Section 8.01. COLLECTION OF MONEY.
GENERAL. Except as otherwise expressly provided herein, the
Indenture Trustee may demand payment or delivery of, and shall receive and
collect, directly and without intervention or assistance of any intermediary,
all money and other property payable to or receivable by the Indenture Trustee
pursuant to this Indenture. The Indenture Trustee shall apply all such money
received by it as provided in this Indenture. Except as otherwise expressly
provided in this Indenture, if any default occurs in the making of any payment
or performance under any agreement or instrument that is part of the Collateral,
the Indenture Trustee may take such action as may be appropriate to enforce such
payment or performance, including the institution and prosecution of appropriate
Proceedings. Any such action shall be without prejudice to any right to claim a
Default or Event of Default under this Indenture and any right to proceed
thereafter as provided in ARTICLE V hereof.
Section 8.02. TRUST ACCOUNTS; DISTRIBUTIONS. (a) On or prior
to the Closing Date, the Issuer shall cause the Servicer to establish and
maintain, in the name of the Indenture Trustee for the benefit of the
Noteholders, or on behalf of the Owner Trustee for the benefit of the
Securityholders, the Trust Accounts as provided in the Sale and Servicing
Agreement. The Indenture Trustee shall deposit amounts into each of the Trust
Accounts in accordance with the terms hereof, the Sale and Servicing Agreement
and the Payment Statements.
(b) COLLECTION ACCOUNT. With respect to the Collection
Account, the Indenture Trustee shall make such withdrawals and distributions
(except as may be otherwise provided in the Collection Account Letter Agreement)
as specified in SECTION 5.01(c)(2) of the Sale and Servicing Agreement in
accordance with the terms thereof.
(c) DISTRIBUTION ACCOUNT. With respect to the Distribution
Account, the Indenture Trustee shall make (i) such deposits as specified in
SECTIONS 5.01(c)(2)(a), 5.01(c)(2)(b), 5.05(e), 5.05(f) and 5.05(g) of the Sale
and Servicing Agreement and (ii) such withdrawals and distributions as specified
in SECTION 5.01(c)(3) of the Sale and Servicing Agreement in accordance with the
terms thereof.
- 40 -
(d) TRANSFER OBLIGATION ACCOUNT. With respect to the Transfer
Obligation Account, the Indenture Trustee shall make (i) such deposits as
specified in SECTION 5.01(c)(3)(vi) of the Sale and Servicing Agreement and (ii)
such withdrawals and distributions as specified in SECTIONS 5.05(d), 5.05(e),
5.05(f), 5.05(g), 5.05(h), 5.05(i) and 5.05(j) of the Sale and Servicing
Agreement in accordance with the terms thereof.
(e) ADVANCE ACCOUNT. With respect to the Advance Account, the
Servicer shall make such withdrawals specified in SECTION 2.06 of the Sale and
Servicing Agreement and Section 2.1(c) of the Loan Purchase Agreement.
Section 8.03. GENERAL PROVISIONS REGARDING TRUST ACCOUNTS. (a)
So long as no Default or Event of Default shall have occurred and be continuing,
all or a portion of the funds in the Collection Account and Transfer Obligation
Account shall be invested in Permitted Investments and reinvested by the
Servicer and the Indenture Trustee, as applicable, at the direction of the
Servicer in accordance with the provisions of SECTION 5.03(b) of the Sale and
Servicing Agreement. All income or other gain from investments of moneys
deposited in the Collection Account and Transfer Obligation Account shall be
deposited by the Indenture Trustee into the Collection Account or Transfer
Obligation Account, as the case may be, immediately upon receipt thereof by the
Indenture Trustee. The Loan Originator will not direct the Indenture Trustee to
make any investment of any funds or to sell any investment held in the
Collection Account or Transfer Obligation Account unless the security interest
Granted and perfected in such account will continue to be perfected in such
investment or the proceeds of such sale, in either case without any further
action by any Person, and, in connection with any direction to the Indenture
Trustee to make any such investment or sale, if requested by the Indenture
Trustee, the Issuer shall deliver to the Indenture Trustee an Opinion of
Counsel, acceptable to the Indenture Trustee, to such effect.
(b) Subject to SECTION 6.01(c) hereof, the Indenture Trustee
shall not in any way be held liable by reason of any insufficiency in the
Collection Account or Transfer Obligation Account resulting from any loss on any
Eligible Investment included therein except for losses attributable to the
Indenture Trustee's failure to make payments on such Permitted Investments
issued by the Indenture Trustee, in its commercial capacity as principal obligor
and not as trustee, in accordance with their terms.
(c) If (i) the Servicer shall have failed to give investment
directions for any funds on deposit in the Collection Account (except as may be
otherwise provided in the Collection Account Letter Agreement) or Transfer
Obligation Account to the Indenture Trustee by 2:00 p.m. New York City time (or
such other time as may be agreed by the Issuer and Indenture Trustee) on any
Business Day or (ii) a Default or Event of Default shall have occurred and be
continuing with respect to the Notes but the Notes shall not have been declared
due and payable pursuant to SECTION 5.02 hereof or (iii) if such Notes shall
have been declared due and payable following an Event of Default, amounts
collected or receivable from the Collateral are being applied in accordance with
SECTION 5.05 hereof as if there had not been such a declaration, then the
Indenture Trustee shall, to the fullest extent practicable, invest and reinvest
funds in the Collection Account and Transfer Obligation Account in one or more
Permitted Investments.
- 41 -
Section 8.04. SERVICER'S STATEMENTS. On each Payment Date, the
Indenture Trustee shall distribute the related Payment Statement to the extent
received from the Servicer and on each Determination Date the Indenture Trustee
shall distribute the related Servicer's Remittance Report to the extent received
from the Servicer to the Issuer and to the Initial Noteholder.
Section 8.05. RELEASE OF COLLATERAL. (a) Subject to the
payment of its reasonable fees and expenses pursuant to SECTION 6.07 hereof, the
Indenture Trustee may, and when required by the provisions of this Indenture
shall, execute instruments acceptable to it and prepared and delivered to it by
the Issuer to release property from the lien of this Indenture, or convey the
Indenture Trustee's interest in the same, without recourse, representation or
warranty in a manner and under circumstances that are not inconsistent with the
provisions of this Indenture. No party relying upon an instrument executed by
the Indenture Trustee as provided in this ARTICLE VIII shall be bound to
ascertain the Indenture Trustee's authority, inquire into the satisfaction of
any conditions precedent or see to the application of any moneys.
(b) The Indenture Trustee shall, at such time as there are no
Notes Outstanding and all sums due to the Noteholders (and their Affiliates),
the Initial Noteholder, the Sales Agents, the Indenture Trustee, the Owner
Trustee and the Custodian under the Basic Documents have been paid, release any
remaining portion of the Collateral that secured the Notes from the lien of this
Indenture and release to the Issuer or any other Person entitled thereto any
funds then on deposit in the Trust Accounts. The Indenture Trustee shall release
property from the lien of this Indenture pursuant to this SUBSECTION (b) only
upon receipt of an Issuer Request accompanied by an Officer's Certificate and an
Opinion of Counsel meeting the applicable requirements of SECTION 11.01 hereof.
Section 8.06. OPINION OF COUNSEL. The Indenture Trustee shall
receive at least seven days' prior notice when requested by the Issuer to take
any action pursuant to SECTION 8.05(a) hereof, accompanied by copies of any
instruments involved, and the Indenture Trustee may also require, as a condition
to such action, an Opinion of Counsel, in form and substance satisfactory to the
Indenture Trustee, stating the legal effect of any such action, outlining the
steps required to complete the same, and concluding that all conditions
precedent to the taking of such action have been complied with and such action
will not materially and adversely impair the security for the Notes or the
rights of the Noteholders in contravention of the provisions of this Indenture;
provided, however, that such Opinion of Counsel shall not be required to express
an opinion as to the fair value of the Collateral. Counsel rendering any such
opinion may rely, without independent investigation, on the accuracy and
validity of any certificate or other instrument delivered to the Indenture
Trustee in connection with any such action.
ARTICLE IX
SUPPLEMENTAL INDENTURES
Section 9.01. SUPPLEMENTAL INDENTURES WITHOUT THE CONSENT OF
THE NOTEHOLDERS. Without the consent of any Noteholder but with prior notice to
the Majority Noteholders, the
- 42 -
Issuer and the Indenture Trustee, when authorized by an Issuer Order, at any
time and from time to time, may enter into one or more indentures supplemental
hereto, in form satisfactory to the Indenture Trustee, for any of the following
purposes:
(i) to correct or amplify the description of any property at
any time subject to the lien of this Indenture, or better to assure,
convey and confirm unto the Indenture Trustee any property subject or
required to be subjected to the lien of this Indenture, or to subject
to the lien of this Indenture additional property;
(ii) to evidence the succession, in compliance with the
applicable provisions hereof, of another Person to the Issuer, and the
assumption by any such successor of the covenants of the Issuer herein
and in the Notes contained;
(iii) to add to the covenants of the Issuer, for the benefit
of the Noteholders, or to surrender any right or power herein conferred
upon the Issuer;
(iv) to convey, transfer, assign, mortgage or pledge any
property to or with the Indenture Trustee;
(v) to cure any ambiguity, to correct or supplement any
provision herein or in any supplemental indenture that may be
inconsistent with any other provision herein or in any supplemental
indenture or to make any other provisions with respect to matters or
questions arising under this Indenture or in any supplemental
indenture; provided, however, that such action shall not adversely
affect the interests of the Noteholders; or
(vi) to evidence and provide for the acceptance of the
appointment hereunder by a successor trustee with respect to the Notes
and to add to or change any of the provisions of this Indenture as
shall be necessary to facilitate the administration of the trusts
hereunder by more than one trustee, pursuant to the requirements of
Article VI hereof.
The Indenture Trustee is hereby authorized to join in the
execution of any such supplemental indenture and to make any further appropriate
agreements and stipulations that may be therein contained.
Section 9.02. SUPPLEMENTAL INDENTURES WITH CONSENT OF
NOTEHOLDERS. The Issuer and the Indenture Trustee, when authorized by an Issuer
Order, also may, with the consent of the Majority Noteholders, by Act of such
Noteholders delivered to the Issuer and the Indenture Trustee, enter into an
indenture or indentures supplemental hereto for the purpose of adding any
provisions to, or changing in any manner or eliminating any of the provisions
of, this Indenture or of modifying in any manner the rights of any Noteholder
under this Indenture; provided, however, that no such supplemental indenture
shall, without the consent of each Noteholder affected thereby:
(a) change the date of payment of any installment of principal
of or interest on any Note, or reduce the principal balance thereof, the
interest rate thereon or the Termination Price with respect thereto, change the
provisions of this Indenture relating to the application of
- 43 -
collections on, or the proceeds of the sale of, the Collateral to payment of
principal of or interest on the Notes, or change any place of payment where, or
the coin or currency in which, any Note or the interest thereon is payable, or
impair the right to institute suit for the enforcement of the provisions of this
Indenture requiring the application of funds available therefor, as provided in
ARTICLE V hereof, to the payment of any such amount due on the Notes on or after
the respective due dates thereof (or, in the case of redemption, on or after the
Redemption Date);
(b) reduce the Percentage Interest, the consent of the Holders
of which is required for any such supplemental indenture, or the consent of the
Holders of which is required for any waiver of compliance with certain
provisions of this Indenture or certain defaults hereunder and their
consequences provided for in this Indenture;
(c) modify or alter the provisions of the definition of the
term "Outstanding" or "Percentage Interest";
(d) reduce the Percentage Interest of the Outstanding Notes,
the consent of the Holders of which is required to direct the Indenture Trustee
to direct the Issuer to sell or liquidate the Collateral pursuant to SECTION
5.04 hereof;
(e) modify any provision of this SECTION 9.02 except to
increase any percentage specified herein or to provide that certain additional
provisions of this Indenture or the Basic Documents cannot be modified or waived
without the consent of the Holder of each Outstanding Note affected thereby;
(f) modify any of the provisions of this Indenture in such
manner as to affect the calculation of the amount of any payment of interest or
principal due on any Note on any Payment Date (including the calculation of any
of the individual components of such calculation) or to adversely affect the
rights of the Noteholders to the benefit of any provisions for the mandatory
redemption of the Notes contained herein; or
(g) permit the creation of any lien ranking prior to or on a
parity with the lien of this Indenture with respect to any part of the
Collateral or, except as otherwise permitted or contemplated herein, terminate
the lien of this Indenture on any property at any time subject hereto or deprive
any Noteholder of the security provided by the lien of this Indenture.
The Indenture Trustee may in its discretion determine whether
or not any Notes would be affected by any supplemental indenture and any such
determination shall be conclusive upon each Noteholder, whether theretofore or
thereafter authenticated and delivered hereunder. The Indenture Trustee shall
not be liable for any such determination made in good faith.
In connection with requesting the consent of the Noteholders
pursuant to this SECTION 9.02, the Indenture Trustee shall mail to the Holders
of the Notes to which such amendment or supplemental indenture relates a notice
prepared by the Issuer setting forth in general terms the substance of such
supplemental indenture. It shall not be necessary for any Act of Noteholders
under this SECTION 9.02 to approve the particular form of any proposed
supplemental indenture, but it shall be sufficient if such Act shall approve the
substance thereof.
- 44 -
Section 9.03. EXECUTION OF SUPPLEMENTAL INDENTURES. In
executing, or permitting the additional trusts created by, any supplemental
indenture permitted by this ARTICLE IX or the modification thereby of the trusts
created by this Indenture, the Indenture Trustee shall be entitled to receive,
and subject to SECTIONS 6.01 and 6.02 hereof, shall be fully protected in
relying upon, an Opinion of Counsel stating that the execution of such
supplemental indenture is authorized or permitted by this Indenture. The
Indenture Trustee may, but shall not be obligated to, enter into any such
supplemental indenture that affects the Indenture Trustee's own rights, duties,
liabilities or immunities under this Indenture or otherwise.
Section 9.04. EFFECT OF SUPPLEMENTAL INDENTURES. Upon the
execution of any supplemental indenture pursuant to the provisions hereof, this
Indenture shall be and shall be deemed to be modified and amended in accordance
therewith with respect to the Notes affected thereby, and the respective rights,
limitations of rights, obligations, duties, liabilities and immunities under
this Indenture of the Indenture Trustee, the Issuer and the Holders of the Notes
shall thereafter be determined, exercised and enforced hereunder subject in all
respects to such modifications and amendments, and all the terms and conditions
of any such supplemental indenture shall be and be deemed to be part of the
terms and conditions of this Indenture for any and all purposes.
Section 9.05. REFERENCE IN NOTES TO SUPPLEMENTAL INDENTURES.
Notes authenticated and delivered after the execution of any supplemental
indenture pursuant to this ARTICLE IX may, and if required by the Indenture
Trustee shall, bear a notation in form approved by the Indenture Trustee as to
any matter provided for in such supplemental indenture. If the Issuer or the
Indenture Trustee shall so determine, new Notes so modified as to conform, in
the opinion of the Indenture Trustee and the Issuer, to any such supplemental
indenture may be prepared and executed by the Issuer and authenticated and
delivered by the Indenture Trustee in exchange for Outstanding Notes.
ARTICLE X
REDEMPTION OF NOTES
Section 10.01. REDEMPTION.
The Majority Certificateholders may, at their option, effect
an early redemption of the Notes on any Payment Date on or after the Clean-up
Call Date. The Majority Certificateholders shall effect such early termination
in the manner specified in and subject to the provisions of SECTION 11.02 of the
Sale and Servicing Agreement.
The Servicer or the Issuer shall furnish the Indenture Trustee
with notice of any such redemption in order to facilitate the Indenture
Trustee's compliance with its obligation to notify the Noteholders of such
redemption in accordance with SECTION 10.02 hereof.
Section 10.02. FORM OF REDEMPTION NOTICE. Notice of redemption
under SECTION 10.01 hereof shall be by first-class mail, postage prepaid, or by
facsimile mailed or transmitted not later than 10 days prior to the applicable
Redemption Date to each Noteholder, as
- 45 -
of the close of business on the Record Date preceding the applicable Redemption
Date, at such Noteholder's address or facsimile number appearing in the Note
Register.
All notices of redemption shall state:
(i) the Redemption Date;
(ii) that on the Redemption Date Noteholders shall receive the
Note Redemption Amount; and
(iii) the place where such Notes are to be surrendered for
payment of the Termination Price (which shall be the office or agency
of the Issuer to be maintained as provided in SECTION 3.02 hereof).
Notice of redemption of the Notes shall be given by the
Indenture Trustee in the name of the Issuer and at the expense of the Servicer.
Failure to give to any Noteholder notice of redemption, or any defect therein,
shall not impair or affect the validity of the redemption of any other Note.
Section 10.03. NOTES PAYABLE ON REDEMPTION DATE; PROVISION FOR
PAYMENT OF INDENTURE TRUSTEE. The Notes to be redeemed shall, following notice
of redemption as required by SECTION 10.02 hereof (in the case of redemption
pursuant to SECTION 10.01) hereof, on the Redemption Date become due and payable
at the Note Redemption Amount and (unless the Issuer shall default in the
payment of the Note Redemption Amount) no interest shall accrue thereon for any
period after the date to which accrued interest is calculated for purposes of
calculating the Note Redemption Amount. The Issuer may not redeem the Notes
unless (i) all outstanding obligations under the Notes have been paid in full
and (ii) the Indenture Trustee has been paid all amounts to which it is entitled
hereunder.
ARTICLE XI
MISCELLANEOUS
Section 11.01. COMPLIANCE CERTIFICATES AND OPINIONS, ETC. Upon
any application or request by the Issuer to the Indenture Trustee to take any
action under any provision of this Indenture (except with respect to the
Servicer's servicing activity in the ordinary course of its business), the
Issuer shall furnish to the Indenture Trustee (i) an Officer's Certificate
stating that all conditions precedent, if any, provided for in this Indenture
relating to the proposed action have been complied with and (ii) an Opinion of
Counsel stating that in the opinion of such counsel all such conditions
precedent, if any, have been complied with.
Every certificate or opinion with respect to compliance with a
condition or covenant provided for in this Indenture shall include:
(1) a statement that each signatory of such certificate
or opinion has read or has caused to be read such
covenant or condition and the definitions herein
relating thereto;
- 46 -
(2) a brief statement as to the nature and scope of the
examination or investigation upon which the
statements or opinions contained in such certificate
or opinion are based;
(3) a statement that, in the opinion of each such
signatory, such signatory has made such examination
or investigation as is necessary to enable such
signatory to express an informed opinion as to
whether or not such covenant or condition has been
complied with; and
(4) a statement as to whether, in the opinion of each
such signatory, such condition or covenant has been
complied with.
Section 11.02. FORM OF DOCUMENTS DELIVERED TO INDENTURE
TRUSTEE. In any case where several matters are required to be certified by, or
covered by an opinion of, any specified Person, it is not necessary that all
such matters be certified by, or covered by the opinion of, only one such
Person, or that they be so certified or covered by only one document, but one
such Person may certify or give an opinion with respect to some matters and one
or more other such Persons as to other matters, and any such Person may certify
or give an opinion as to such matters in one or several documents.
Any certificate or opinion of an Authorized Officer of the
Issuer may be based, insofar as it relates to legal matters, upon a certificate
or opinion of, or representations by, counsel, unless such officer knows, or in
the exercise of reasonable care should know, that the certificate or opinion or
representations with respect to the matters upon which such officer's
certificate or opinion is based are erroneous. Any such certificate of an
Authorized Officer or Opinion of Counsel may be based, insofar as it relates to
factual matters, upon a certificate or opinion of, or representations by, an
officer or officers of the Servicer, the Loan Originator, the Issuer or the
Administrator, stating that the information with respect to such factual matters
is in the possession of the Servicer, the Loan Originator, the Issuer or the
Administrator, unless such counsel knows, or in the exercise of reasonable care
should know, that the certificate or opinion or representations with respect to
such matters are erroneous.
Where any Person is required to make, give or execute two or
more applications, requests, consents, certificates, statements, opinions or
other instruments under this Indenture, they may, but need not, be consolidated
and form one instrument.
Whenever in this Indenture, in connection with any application
or certificate or report to the Indenture Trustee, it is provided that the
Issuer shall deliver any document as a condition of the granting of such
application, or as evidence of the Issuer's compliance with any term hereof, it
is intended that the truth and accuracy, at the time of the granting of such
application or at the effective date of such certificate or report (as the case
may be), of the facts and opinions stated in such document shall in such case be
conditions precedent to the right of the Issuer to have such application granted
or to the sufficiency of such certificate or report. The foregoing shall not,
however, be construed to affect the Indenture Trustee's right to rely upon the
truth and accuracy of any statement or opinion contained in any such document as
provided in ARTICLE VI hereof.
- 47 -
Section 11.03. ACTS OF NOTEHOLDERS. (a) Any request, demand,
authorization, direction, notice, consent, waiver or other action provided by
this Indenture to be given or taken by Noteholders may be embodied in and
evidenced by one or more instruments of substantially similar tenor signed by
such Noteholders in person or by agents duly appointed in writing; and except as
herein otherwise expressly provided, such action shall become effective when
such instrument or instruments are delivered to the Indenture Trustee, and,
where it is hereby expressly required, to the Issuer. Such instrument or
instruments (and the action embodied therein and evidenced thereby) are herein
sometimes referred to as the "ACT" of the Noteholders signing such instrument or
instruments. Proof of execution of any such instrument or of a writing
appointing any such agent shall be sufficient for any purpose of this Indenture
and (subject to SECTION 6.01 hereof) conclusive in favor of the Indenture
Trustee and the Issuer, if made in the manner provided in this SECTION 11.03.
(b) The fact and date of the execution by any Person of any
such instrument or writing may be proved in any manner that the Indenture
Trustee deems sufficient.
(c) The ownership of Notes shall be proved by the Note
Register.
(d) Any request, demand, authorization, direction, notice,
consent, waiver or other action by any Noteholder shall bind the Holder of every
Note issued upon the registration thereof or in exchange therefor or in lieu
thereof, in respect of anything done, omitted or suffered to be done by the
Indenture Trustee or the Issuer in reliance thereon, whether or not notation of
such action is made upon such Note.
Section 11.04. NOTICES, ETC., TO INDENTURE TRUSTEE AND ISSUER
. Any request, demand, authorization, direction, notice, consent, waiver or Act
of Noteholders or other documents provided or permitted by this Indenture shall
be in writing and if such request, demand, authorization, direction, notice,
consent, waiver or act of Noteholders is to be made upon, given or furnished to
or filed with:
(i) the Indenture Trustee by any Noteholder or by the Issuer
shall be sufficient for every purpose hereunder if made, given,
furnished or filed in writing to or with the Indenture Trustee at its
Corporate Trust Office, or
(ii) the Issuer by the Indenture Trustee or by any Noteholder
shall be sufficient for every purpose hereunder if in writing and
made, given, furnished, filed or transmitted via facsimile to the
Issuer at: FFCA Franchise Loan Owner Trust 1998-1, c/o Wilmington
Trust Company, Xxxxxx Square North, 0000 Xxxxx Xxxxxx Xxxxxx,
Xxxxxxxxxx, Xxxxxxxx 00000, Attention: Corporate Trust Administration,
telecopy number: (000) 000-0000, telephone number: (000) 000-0000, or
at any other address or facsimile number previously furnished in
writing to the Indenture Trustee by the Issuer or the Administrator.
The Issuer shall promptly transmit any notice received by it from the
Noteholders to the Indenture Trustee.
Section 11.05. NOTICES TO NOTEHOLDERS; WAIVER. Where this
Indenture provides for notice to Noteholders of any event, such notice shall be
sufficiently given (unless otherwise
- 48 -
herein expressly provided) if in writing and mailed, first-class, postage
prepaid to each Noteholder affected by such event, at his address as it appears
on the Note Register, not later than the latest date, and not earlier than the
earliest date, prescribed for the giving of such notice. In any case where
notice to Noteholders is given by mail, neither the failure to mail such notice
nor any defect in any notice so mailed to any particular Noteholder shall affect
the sufficiency of such notice with respect to other Noteholders, and any notice
that is mailed in the manner herein provided shall conclusively be presumed to
have duly been given.
Where this Indenture provides for notice in any manner, such
notice may be waived in writing by any Person entitled to receive such notice,
either before or after the event, and such waiver shall be the equivalent of
such notice. Waivers of notice by Noteholders shall be filed with the Indenture
Trustee but such filing shall not be a condition precedent to the validity of
any action taken in reliance upon such a waiver.
In case, by reason of the suspension of regular mail service
as a result of a strike, work stoppage or similar activity, it shall be
impractical to mail notice of any event to Noteholders when such notice is
required to be given pursuant to any provision of this Indenture, then any
manner of giving such notice as shall be satisfactory to the Indenture Trustee
shall be deemed to be a sufficient giving of such notice.
Section 11.06. EFFECT OF HEADINGS AND TABLE OF CONTENTS. The
Article and Section headings herein and the Table of Contents are for
convenience only and shall not affect the construction hereof.
Section 11.07. SUCCESSORS AND ASSIGNS. All covenants and
agreements in this Indenture and the Notes by the Issuer shall bind its
successors and assigns, whether so expressed or not. All agreements of the
Indenture Trustee in this Indenture shall bind its successors, co-trustees and
agents.
Section 11.08. SEPARABILITY. In case any provision in this
Indenture or in the Notes shall be invalid, illegal or unenforceable, the
validity, legality and enforceability of the remaining provisions shall not in
any way be affected or impaired thereby.
Section 11.09. BENEFITS OF INDENTURE. Nothing in this
Indenture or in the Notes, express or implied, shall give to any Person, other
than the parties hereto and their successors hereunder, and the Noteholders, and
any other party secured hereunder, and any other Person with an ownership
interest in any part of the Collateral, any benefit or any legal or equitable
right, remedy or claim under this Indenture.
Section 11.10. LEGAL HOLIDAYS. In any case where the date on
which any payment is due shall not be a Business Day, then (notwithstanding any
other provision of the Notes or this Indenture) payment need not be made on such
date, but may be made on the next succeeding Business Day with the same force
and effect as if made on the date on which nominally due, and no interest shall
accrue for the period from and after any such nominal date.
- 49 -
Section 11.11. GOVERNING LAW. THIS INDENTURE SHALL BE
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, 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.
Section 11.12. COUNTERPARTS. This Indenture may be executed in
any number of counterparts, each of which so executed shall be deemed to be an
original, but all such counterparts shall together constitute but one and the
same instrument.
Section 11.13. RECORDING OF INDENTURE. If this Indenture is
subject to recording in any appropriate public recording offices, such recording
is to be effected by the Issuer and at its expense accompanied by an Opinion of
Counsel (which may be counsel to the Indenture Trustee or any other counsel
reasonably acceptable to the Indenture Trustee; provided, however, that the
expense of such Opinion of Counsel shall in no event be an expense of the
Indenture Trustee) to the effect that such recording is necessary either for the
protection of the Noteholders or any other Person secured hereunder or for the
enforcement of any right or remedy granted to the Indenture Trustee under this
Indenture.
Section 11.14. TRUST OBLIGATION. No recourse may be taken,
directly or indirectly, with respect to the obligations of the Issuer, the Owner
Trustee or the Indenture Trustee on the Notes or, except as expressly provided
for in ARTICLE VI hereof, under this Indenture or any certificate or other
writing delivered in connection herewith or therewith, against (i) the Indenture
Trustee or the Owner Trustee in its individual capacity, (ii) any owner of a
beneficial interest in the Issuer or (iii) any partner, owner, beneficiary,
agent, officer, director, employee, agent or "control person" within the meaning
of the Act and the Securities Exchange Act of 1934, as amended, of the Indenture
Trustee or the Owner Trustee in its individual capacity, any holder of a
beneficial interest in the Issuer, the Owner Trustee or the Indenture Trustee or
of any successor or assign of the Indenture Trustee or the Owner Trustee in its
individual capacity, except as any such Person may expressly have agreed (it
being understood that the Indenture Trustee and the Owner Trustee have no such
obligations in their individual capacity) and except that any such partner,
owner or beneficiary of the Issuer shall be fully liable, to the extent provided
by applicable law, for any unpaid consideration for stock, unpaid capital
contribution or failure to pay any installment or call owing to such entity. For
all purposes of this Indenture, in the performance of any duties or obligations
of the Issuer hereunder, the Owner Trustee shall be subject to, and entitled to
the benefits of, the terms and provisions of Articles VI, VII and VIII of the
Trust Agreement.
Section 11.15. NO PETITION. The Indenture Trustee, by entering
into this Indenture, and each Noteholder, by accepting a Note, hereby covenant
and agree that they will not at any time institute against the Depositor or the
Issuer, or join in any institution against the Depositor or the Issuer of, any
bankruptcy, reorganization, arrangement, insolvency or liquidation proceedings,
or other proceedings under any United States federal or state bankruptcy or
similar law, in connection with any obligations relating to the Notes, this
Indenture or any of the Basic Documents.
- 50 -
Section 11.16. INSPECTION. The Issuer agrees that, on
reasonable prior notice, it will permit any representative of the Indenture
Trustee, during the Issuer's normal business hours, to examine all the books of
account, records, reports and other papers of the Issuer, to make copies and
extracts therefrom, to cause such books to be audited by Independent certified
public accountants, and to discuss the Issuer's affairs, finances and accounts
with the Issuer's officers, employees, and Independent certified public
accountants, all at such reasonable times and as often as may reasonably be
requested and at the expense of the Servicer. The Indenture Trustee shall and
shall cause its representatives to hold in confidence all such information
except to the extent disclosure may be required by law (and all reasonable
applications for confidential treatment are unavailing) and except to the extent
that the Indenture Trustee may reasonably determine that such disclosure is
consistent with its obligations hereunder.
- 51 -
IN WITNESS WHEREOF, the Issuer and the Indenture Trustee have
caused this Indenture to be duly executed by their respective officers,
thereunto duly authorized and duly attested, all as of the day and year first
above written.
FFCA FRANCHISE LOAN OWNER
TRUST 1998-1
By: WILMINGTON TRUST COMPANY
not in its individual capacity but
solely as Owner Trustee
By: /s/ Xxx X. Xxxxxxx
----------------------------------------
Name: Xxx X. Xxxxxxx
Title: Senior Financial Services Officer
LASALLE NATIONAL BANK,
as Indenture Trustee
By: /s/ Xxxxxxx X. Xxxxx
----------------------------------------
Name: Xxxxxxx X. Xxxxx
Title: First Vice President
- 52 -
State of Delaware
County of New Castle
BEFORE ME, the undersigned authority, a Notary Public in and
for said county and state, on this day personally appeared Xxx X. Xxxxxxx, known
to me to be the person and officer whose name is subscribed to the foregoing
instrument and acknowledged to me that the same was the act of the said
WILMINGTON TRUST COMPANY, a Delaware banking corporation, not in its individual
capacity, but solely as Owner Trustee on behalf of FFCA FRANCHISE LOAN OWNER
TRUST 1998-1, a Delaware business trust, and that such person executed the same
as the act of said business trust for the purpose and consideration therein
expressed, and in the capacities therein stated.
GIVEN UNDER MY HAND AND SEAL OF OFFICE, this 10th day of
August, 1998.
/s/ Xxxxxxx X. Xxxxxx
------------------------------------------------
Notary Public in and for the State of New York
(Seal)
My commission expires:
11-21-99
---------------------
Schedule A-1
State of Illinois )
) ss.
County of Xxxx )
On the ____ day of August 1998, before me, Xxxxxxxx X. Xxxx, a notary
public in and for said State, personally appeared Xxxxxxx X. Xxxxx, known to me
to be a First Vice President of LaSalle National Bank, one of the corporations
that executed the within instrument, and also known to me to be the person who
executed it on behalf of said corporation, and acknowledged to me that such
corporation executed the within instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official
seal the day and year in this certificate first above written.
/s/ Xxxxxxxx X. Xxxx
----------------------------------
Xxxxxxxx X. Xxxx
My Commission Expires: 12-1-01
[Notarial Seal]
Schedule A-2
EXHIBIT A
THE OUTSTANDING PRINCIPAL AMOUNT OF THIS NOTE AT ANY TIME MAY BE LESS THAN THE
MAXIMUM NOTE PRINCIPAL BALANCE SHOWN ON THE FACE HEREOF. ANY PURCHASER OF THIS
NOTE MAY ASCERTAIN THE OUTSTANDING PRINCIPAL AMOUNT HEREOF BY INQUIRY OF THE
INDENTURE TRUSTEE
THIS NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED
(THE "1933 ACT"), OR ANY STATE SECURITIES LAWS. NEITHER THIS NOTE NOR ANY
INTEREST OR PARTICIPATION HEREIN MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED,
PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH
REGISTRATION, UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO,
REGISTRATION.
THE HOLDER OF THIS NOTE BY ITS ACCEPTANCE HEREOF AGREES TO OFFER, SELL OR
OTHERWISE TRANSFER SUCH NOTE ONLY (A) PURSUANT TO A REGISTRATION STATEMENT WHICH
HAS BEEN DECLARED EFFECTIVE UNDER THE 1933 ACT, (B) FOR SO LONG AS THIS NOTE IS
ELIGIBLE FOR RESALE PURSUANT TO RULE 144A UNDER THE 1933 ACT, TO A PERSON IT
REASONABLY BELIEVES IS A "QUALIFIED INSTITUTIONAL BUYER" AS DEFINED IN RULE 144A
UNDER THE 1933 ACT THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A
QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE TRANSFER IS BEING
MADE IN RELIANCE ON RULE 144A OR (C) TO AN INSTITUTIONAL "ACCREDITED INVESTOR"
WITHIN THE MEANING OF SUBPARAGRAPH (A)(1), (2), (3) OR (7) OF RULE 501 UNDER THE
1933 ACT THAT IS ACQUIRING THE NOTE FOR ITS OWN ACCOUNT, OR FOR THE ACCOUNT OF
SUCH AN INSTITUTIONAL "ACCREDITED INVESTOR," FOR INVESTMENT PURPOSES AND NOT
WITH A VIEW TO, OR FOR OFFER OR SALE IN CONNECTION WITH, ANY DISTRIBUTION IN
VIOLATION OF THE 1933 ACT, IN EACH CASE IN COMPLIANCE WITH THE REQUIREMENTS OF
THE INDENTURE AND APPLICABLE STATE SECURITIES LAWS.
THIS NOTE MAY NOT BE TRANSFERRED UNLESS THE INDENTURE TRUSTEE HAS RECEIVED A
NOTE FROM THE TRANSFEREE TO THE EFFECT THAT EITHER (I) THE TRANSFEREE IS NOT AN
EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT PLAN OR ARRANGEMENT SUBJECT TO TITLE I
OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED, OR SECTION
4975 OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (EACH, A "PLAN"), AND IS
NOT ACTING ON BEHALF OF OR INVESTING THE ASSETS OF A PLAN OR (II) IF THE
TRANSFEREE IS A PLAN, OR IS ACTING ON BEHALF OF OR INVESTING THE ASSETS OF A
PLAN, THE CONDITIONS FOR EXEMPTIVE RELIEF UNDER AT LEAST ONE OF THE FOLLOWING
PROHIBITED TRANSACTION CLASS EXEMPTIONS HAVE BEEN SATISFIED: PROHIBITED
A-1
TRANSACTION CLASS EXEMPTION ("PTCE") 96-23 (RELATING TO TRANSACTIONS EFFECTED BY
AN "IN-HOUSE ASSET MANAGER"), PTCE 95-60 (RELATING TO TRANSACTIONS INVOLVING
INSURANCE COMPANY GENERAL ACCOUNTS), PTCE 91-38 (RELATING TO TRANSACTIONS
INVOLVING BANK COLLECTIVE INVESTMENT FUNDS), PTCE 90-1 (RELATING TO TRANSACTIONS
INVOLVING INSURANCE COMPANY POOLED SEPARATE ACCOUNTS) AND PTCE 84-14 (RELATING
TO TRANSACTIONS EFFECTED BY A "QUALIFIED PROFESSIONAL ASSET MANAGER"). EACH
TRANSFEREE OF A BENEFICIAL INTEREST HEREIN THAT IS A PLAN, OR IS A PERSON ACTING
ON BEHALF OF OR INVESTING THE ASSETS OF A PLAN, SHALL BE DEEMED TO MAKE THE
REPRESENTATION SET FORTH UNDER (II) ABOVE.
A-2
Maximum Note Principal Balance $_____________
Initial Percentage Interest ____%
No. ___
FFCA FRANCHISE LOAN OWNER TRUST 1998-1
FRANCHISE LOAN BACKED NOTES SERIES 1998-1
FFCA FRANCHISE LOAN OWNER TRUST 1998-1, a Delaware business
trust (the Issuer"), for value received, hereby promises to pay to
____________________________, or registered assigns (the "Noteholder"), the
principal sum of __________________ ($____________) or so much thereof as may be
advanced and outstanding hereunder and to pay interest on such principal sum or
such part thereof as shall remain unpaid from time to time, at the rate and at
the times provided in the Sale and Servicing Agreement and the Indenture.
Principal of this Note is payable on each Payment Date in an amount equal to the
result obtained by multiplying (i) the Percentage Interest of this Note by (ii)
the Principal Payment Amount with respect to such Payment Date.
The Outstanding Note Principal Balance of this Note bears
interest at the Note Interest Rate. On each Payment Date amounts in respect of
interest on this Note will be paid in an amount equal to the result obtained by
multiplying (i) the Percentage Interest of this Note by (ii) the aggregate
amount paid in respect of interest on the Notes with respect to such Payment
Date.
Capitalized terms used but not defined herein have the
meanings set forth in the Indenture (the "Indenture"), dated as of August 14,
1998 between the Issuer and LaSalle National Bank, as Indenture Trustee (the
"Indenture Trustee"). as supplemented by the Indenture Supplement, dated as of
August 14, 1998, between the Issuer and the Indenture Trustee (the
"Supplement").
By its acceptance of this Note, each Noteholder covenants and
agrees, until the earlier of (a) the termination of the Revolving Period and (b)
the Maturity Date, on each Transfer Date and Collateral Value Excess Date to
advance amounts in respect of Additional Principal Balance hereunder to the
Issuer, subject to and in accordance with the terms of the Indenture, the Sale
and Servicing Agreement and the Note Purchase Agreement.
In the event of an advance of Additional Note Principal
Balance by the Noteholders as provided in SECTION 2.01(c) of the Sale and
Servicing Agreement, each Noteholder shall, and is hereby authorized to, record
on the schedule attached to its Note the date and amount of any Additional Note
Principal Balance advanced by it, and each repayment thereof; provided that
failure to make any such recordation on such schedule or any error in such
schedule shall not adversely affect any Noteholder's rights with respect to its
Additional Note Principal Balance and its right to receive interest payments in
respect of the Additional Note Principal Balance held by such Noteholder.
Absent manifest error, the Note Principal Balance of each Note
as set forth in the notations made by the related Noteholder on such Note shall
be binding upon the Indenture
A-3
Trustee and the Issuer; provided that failure by a Noteholder to make such
recordation on its Note or any error in such notation shall not adversely affect
any Noteholder's rights with respect to its Note Principal Balance and its right
to receive principal and interest payments in respect thereof.
The Majority Certificateholders may, at their option, effect
an early redemption of the Notes at par plus accrued and unpaid interest on the
Notes on any Payment Date on or after the Clean-up Call Date. The Majority
Certificateholders shall effect such early termination by providing notice
thereof to the Indenture Trustee and Owner Trustee and by purchasing all of the
Loans at a purchase price, payable in cash, equal to than the Termination Price.
Reference is hereby made to the further provisions of this
Note set forth on the reverse hereof, which further provisions shall for all
purposes have the same effect as if set forth at this place.
The statements in the legend set forth above are an integral
part of the terms of this Note and by acceptance hereof each Holder of this Note
agrees to be subject to and bound by the terms and provisions set forth in such
legend.
Unless the Certificate of authentication hereon shall have
been executed by an authorized officer of the Owner Trustee, by manual
signature, this Note shall not entitle the Noteholder hereof to any benefit
under the Indenture, the Supplement or the Sale and Servicing Agreement and/or
be valid for any purpose.
THIS NOTE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE
WITH, THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO CONTRACTS MADE AND
PERFORMED WITHIN THE STATE OF NEW YORK AND WITHOUT GIVING EFFECT TO THE CONFLICT
OF LAW PROVISIONS THEREOF.
A-4
IN WITNESS WHEREOF, the Issuer has caused this instrument to
be signed, manually or in facsimile, by its Authorized Officer, as of the date
set forth below.
Date: August __, 1998
FFCA FRANCHISE LOAN OWNER TRUST 1998-1
By: WILMINGTON TRUST COMPANY,
not in its individual capacity but solely as
Owner Trustee under the Trust Agreement
By: ____________________________________________
Authorized Signatory
INDENTURE TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Notes designated above and referred to in the
within-mentioned Indenture.
Date: August __, 1998
LASALLE NATIONAL BANK,
not in its individual capacity but solely as
Indenture Trustee
By: ____________________________________________
Authorized Signatory
A-5
[Reverse of Note]
This Note is one of a duly authorized Series of Notes of the
Issuer, designated as its Loan Backed Notes Series 1998-1 (herein called the
"Notes"), all issued under the Indenture and the Supplement. Reference is hereby
made to the Indenture, the Supplement and all indentures supplemental thereto,
and the Sale and Servicing Agreement for a statement of the respective rights
and obligations thereunder of the Issuer, the Indenture Trustee and the Holders
of the Notes. To the extent that any provision of this Note contradicts or is
inconsistent with the provisions of the Indenture, the Supplement or the Sale
and Servicing Agreement, the provisions of the Indenture, the Supplement or the
Sale and Servicing Agreement, as applicable, shall control and supersede such
contradictory or inconsistent provision herein. The Notes are subject to all
terms of the Indenture, the Supplement and the Sale and Servicing Agreement.
The principal of and interest on this Note are payable in such
coin or currency of the United States of America as at the time of payment is
legal tender for payment of public and private debts. All payments made by the
Issuer with respect to this Note shall be applied in accordance with the
Indenture, the Supplement and the Sale and Servicing Agreement.
The entire unpaid principal amount of this Note shall be due
and payable on the earlier of the Maturity Date and the Termination Date, if
any, pursuant to SECTION 11.01 of the Sale and Servicing Agreement.
Notwithstanding the foregoing, the entire unpaid principal amount of the Notes
shall be due and payable on the date on which an Event of Default shall have
occurred and be continuing and the Indenture Trustee, at the direction or upon
the prior written consent of the Majority Noteholders, has declared the Notes to
be immediately due and payable in the manner provided in SECTION 5.02 of the
Indenture. All principal payments on the Notes shall be made PRO RATA to the
Holders of the Notes entitled thereto.
The Collateral secures this Note and all other Notes equally
and ratably without prejudice, priority or distinction between any Note and any
other Note. The Notes are non-recourse obligations of the Issuer and are limited
in right of payment to amounts available from the Collateral, provided in the
Indenture. The Issuer shall not otherwise be liable for payments on the Notes,
and none of the owners, agents, officers, directors, employees, or successors or
assigns of the Issuer shall be personally liable for any amounts payable, or
performance due, under the Notes or the Indenture.
Any installment of interest or principal on this Note shall be
paid on the applicable Payment Date to the Person in whose name this Note (or
one or more Predecessor Notes) is registered in the Note Register as of the
close of business on the related Record Date by wire transfer in immediately
available funds to the account specified in writing by the related Noteholder.
Any reduction in the principal amount of this Note (or any one
or more Predecessor Notes) effected by any payments made on any Payment Date
shall be binding upon all future Holders of this Note and of any Note issued
upon the registration of transfer hereof or
A-6
in exchange hereof or in lieu hereof, whether or not noted hereon. Any increase
in the principal amount of this Note (or any one or more Predecessor Notes)
effected by payments to the Issuer of Additional Note Principal Balances shall
be binding upon the Issuer and shall inure to the benefit of all future Holders
of this Note and of any Note issued upon the registration of transfer hereof or
in exchange hereof or in lieu hereof, whether or not noted hereon.
As provided in the Indenture and subject to certain
limitations set forth therein, the transfer of this Note may be registered on
the Note Register upon surrender of this Note for registration of transfer at
the office or agency designated by the Issuer pursuant to the Indenture, duly
endorsed by, or accompanied by a written instrument of transfer in the form
attached hereto duly executed by, the Holder hereof or such Holder's attorney
duly authorized in writing, with such signature guaranteed by an "eligible
guarantor institution" meeting the requirements of the Securities Transfer
Agent's Medallion Program ("STAMP"), and thereupon one or more new Notes of
authorized denominations and in the same aggregate principal amount will be
issued to the designated transferee or transferees. No service charge will be
charged for any registration of transfer or exchange of this Note, but the
Issuer may require the Noteholder to pay a sum sufficient to cover any tax or
other governmental charge that may be imposed in connection with any such
registration of transfer or exchange.
Each Noteholder, by acceptance of a Note or a beneficial
interest in a Note, covenants and agrees that no recourse may be taken, directly
or indirectly, with respect to the obligations of the Issuer, the Owner Trustee
or the Indenture Trustee on the Notes or under the Indenture or any certificate
or other writing delivered in connection therewith, against (i) the Indenture
Trustee or the Owner Trustee in its individual capacity, (ii) any owner of a
beneficial interest in the Issuer or (iii) any partner, owner, beneficiary,
agent, officer, director employee or "control person" within the meaning of the
Securities Act of 1933, as amended and the Securities Exchange Act of 1934, as
amended, of the Indenture Trustee or the Owner Trustee in its individual
capacity, any holder of a beneficial interest in the Issuer, the Owner Trustee
or the Indenture Trustee or of any successor or assign of the Indenture Trustee
or the Owner Trustee in its individual capacity, except as any such Person may
have expressly agreed and except that any such partner, owner or beneficiary
shall be fully liable, to the extent provided by applicable law, for any unpaid
consideration for stock, unpaid capital contribution or failure to pay any
installment or call owing to such entity.
Each Noteholder, by acceptance of a Note or a beneficial
interest in a Note, covenants and agrees by accepting the benefits of the
Indenture that such Noteholder will not at any time institute against the
Issuer, or join in any institution against the Issuer of, any bankruptcy,
reorganization, arrangement, insolvency or liquidation proceedings under any
United States federal or state bankruptcy or similar law in connection with any
obligations relating to the Notes or the Basic Documents.
The Issuer has entered into the Indenture and this Note is
issued with the intention that, for federal, state and local income, single
business and franchise tax purposes, the Notes will qualify as indebtedness of
the Issuer secured by the Collateral. Each Noteholder, by acceptance of a Note,
agrees to treat the Notes for federal, state and local income, single business
and franchise tax purposes as indebtedness of the Issuer.
A-7
Prior to the due presentment for registration of transfer of
this Note, the Issuer, the Indenture Trustee and any agent of the Issuer or the
Indenture Trustee may treat the Person in whose name this Note (as of the day of
determination or as of such other date as may be specified in the Indenture) is
registered as the owner hereof for all purposes, whether or not this Note be
overdue, and none of the Issuer, the Indenture Trustee or any such agent shall
be affected by notice to the contrary.
The Indenture permits, with certain exceptions as therein
provided, the amendment thereof and the modification of the rights and
obligations of the Issuer and the rights of the Holders of the Notes under the
Indenture at any time by the Issuer with the consent of the Majority
Noteholders. The Indenture also contains provisions permitting the Holders of
Notes representing specified Percentage Interests of the Outstanding Notes, on
behalf of all of the Noteholders, to waive compliance by the Issuer with certain
provisions of the Indenture and certain past defaults under the Indenture and
their consequences. Any such consent or waiver by the Holder of this Note (or
any one or more Predecessor Notes) shall be conclusive and binding upon such
Holder and upon all future Holders of this Note and of any Note issued upon the
registration of transfer hereof or in exchange hereof or in lieu hereof whether
or not notation of such consent or waiver is made upon this Note. The Indenture
also permits the Indenture Trustee to amend or waive certain terms and
conditions set forth in the Indenture without the consent of any Noteholder.
The term "Issuer" as used in this Note includes any successor
to the Issuer under the Indenture.
The Notes are issuable only in registered form in
denominations as provided in the Indenture, subject to certain limitations
therein set forth.
No reference herein to the Indenture and no provision of this
Note or of the Indenture shall alter or impair the obligation of the Issuer,
which is absolute and unconditional, to pay the principal of and interest on
this Note at the times, place and rate, and in the coin or currency herein
prescribed.
Anything herein to the contrary notwithstanding, except as
expressly provided in the Basic Documents, none of the Issuer in its individual
capacity, the Owner Trustee in its individual capacity, any owner of a
beneficial interest in the Issuer, or any of their respective partners,
beneficiaries, agents, officers, directors, employees or successors or assigns
shall be personally liable for, nor shall recourse be had to any of them for,
the payment of principal of or interest on this Note or performance of, or
omission to perform, any of the covenants, obligations or indemnifications
contained in the Indenture. The Holder of this Note by its acceptance hereof
agrees that, except as expressly provided in the Basic Documents, in the case of
an Event of Default under the Indenture, the Holder shall have no claim against
any of the foregoing for any deficiency, loss or claim therefrom; provided,
however, that nothing contained herein shall be taken to prevent recourse to,
and enforcement against, the assets of the Issuer for any and all liabilities,
obligations and undertakings contained in the Indenture or in this Note.
A-8
ASSIGNMENT
Social Security or taxpayer I.D. or other identifying number of assignee:
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and
transfers unto:
(name and address of assignee)
the within Note and all rights thereunder, and hereby irrevocably constitutes
and appoints, attorney, to transfer said Note on the books kept for registration
thereof, with full power of substitution in the premises.
Dated:_____________________
___________________________________*/
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 Note in every
particular, without alteration, enlargement or any change whatever. Such
signature must be guaranteed by an "eligible guarantor institution" meeting the
requirements of STAMP.
A-9
Schedule to Note
dated as of August __, 1998
of FFCA FRANCHISE LOAN OWNER TRUST 1998-1
-------------------------------------------------------------------------------------------------------
Date of advance of Amount of advance of Note Principal
Additional Note Additional Note aggregate Note Balance of
Principal Balance Principal Balance Percentage Interest Principal Balance Note
------------------------------------------------------------------------------------------------------
100%
-------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------
X-00
XXXXXXX X-0
FORM OF RULE 144A TRANSFER CERTIFICATE
Re: FFCA Franchise Loan Owner Trust 1998-1
FRANCHISE LOAN BACKED NOTES SERIES ______
Reference is hereby made to the Indenture dated as of August 14, 1998
(the "INDENTURE") between FFCA Franchise Loan Owner Trust 1998-1 (the "TRUST")
and LaSalle National Bank (the "INDENTURE TRUSTEE"). Capitalized terms used but
not defined herein shall have the meanings given to them in the Sale and
Servicing Agreement dated as of August 14, 1998 among the Trust, Franchise
Finance Corporation of America ("FFCA"), FFCA Warehouse Lending Corporation (the
"DEPOSITOR"), FFCA Acquisition Corporation and LaSalle National Bank, as
Indenture Trustee.
The undersigned (the "TRANSFEROR") has requested a transfer of
$_________ current principal balance Notes to [insert name of transferee].
In connection with such request, and in respect of such Notes, the
Transferor hereby certifies that such Notes are being transferred in accordance
with (i) the transfer restrictions set forth in the Indenture and the Notes and
(ii) Rule 144A under the Securities Act of 1933, as amended to a purchaser that
the Transferor reasonably believes is a "qualified institutional buyer" within
the meaning of Rule 144A purchasing for its own account or for the account of a
"qualified institutional buyer," which purchaser is aware that the sale to it is
being made in reliance upon Rule 144A, in a transaction meeting the requirements
of Rule 144A and in accordance with any applicable securities laws of any state
of the United States or any other applicable jurisdiction.
This certificate and the statements contained herein are made for your
benefit and the benefit of the Depositor.
____________________________________
[Name of Transferor]
By: ________________________________
Name:
Title:
Dated: ________________, _______
B-1-1
EXHIBIT B-2
FORM OF PURCHASER'S LETTER FOR
INSTITUTIONAL ACCREDITED INVESTOR
_____________________
[Date]
Dear Sirs:
In connection with our proposed purchase of $_________________ Note Principal
Balance Franchise Loan Backed Notes, Series _________ (the "OFFERED NOTES")
issued by FFCA Franchise Loan Owner Trust 1998-1 (the "TRUST"), we confirm that:
(1) We understand that the Offered Notes have not been, and will not be,
registered under the Securities Act of 1933, as amended (the "1933
ACT") or any state securities laws, and may not be sold except as
permitted in the following sentence. We agree, on our own behalf and on
behalf of any accounts for which we are acting as hereinafter stated,
that if we should sell any Offered Notes we will do so only (a)
pursuant to a registration statement which has been declared effective
under the 1933 Act, (b) for so long as the Offered Notes are eligible
for resale pursuant to Rule 144A under the 1933 Act, to a Person we
reasonably believe is a "qualified institutional buyer" as defined in
Rule 144A that purchases for its own account or for the account of a
qualified institutional buyer to whom notice is given that the transfer
is being made in reliance on Rule 144A, (c) to an institutional
"accredited investor" within the meaning of subparagraph (a)(1), (2),
(3) or (7) of Rule 501 under the 1933 Act (an "INSTITUTIONAL ACCREDITED
INVESTOR") that is acquiring the Offered Notes for its own account, or
for the account of such an Institutional Accredited Investor, for
investment purposes and not with a view to, or for offer or sale in
connection with, any distribution in violation of the 1933 Act, in each
case in compliance with the requirements of the Indenture dated as of
August 14, 1998 between FFCA Franchise Loan Owner Trust 1998-1 and
LaSalle National Bank, as Indenture Trustee, and applicable state
securities laws; and we further agree, in the capacities stated above,
to provide to any person purchasing any of the Offered Notes from us a
notice advising such purchaser that resales of the Offered Notes are
restricted as stated herein.
(2) We understand that, in connection with any proposed resale of any
Offered Notes to an Institutional Accredited Investor, we will be
required to furnish to the Indenture Trustee and the Depositor a
certification from such transferee as provided in Section 2.12 of the
Indenture to confirm that the proposed sale is being made pursuant to
an exemption from, or in a transaction not subject to, the registration
requirements of the 1933 Act and applicable state securities laws. We
further understand that the Offered Notes purchased by us will bear a
legend to the foregoing effect.
(3) We are acquiring the Offered Notes for investment purposes and not with
a view to, or for offer or sale in connection with, any distribution in
violation of the 1933 Act.
B-2-1
We have such knowledge and experience in financial and business matters
as to be capable of evaluating the merits and risks of our investment
in the Offered Notes, and we and any account for which we are acting
are each able to bear the economic risk of such investment.
(4) We are an Institutional Accredited Investor and we are acquiring the
Offered Notes purchased by us for our own account or for one or more
accounts (each of which is an Institutional Accredited Investor) as to
each of which we exercise sole investment discretion.
(5) We have received such information as we deem necessary in order to make
our investment decision.
Terms used in this letter which are not otherwise defined herein have
the respective meanings assigned thereto in the Indenture.
You and the Depositor are entitled to rely upon this letter and are
irrevocably authorized to produce this letter or a copy hereof to any interested
party in any administrative or legal proceeding or official inquiry with respect
to the matters covered hereby.
Very truly yours,
_______________________________
[Purchaser]
By: ___________________________
Name:
Title:
X-0-0
XXXXXXX X-0
[FORM OF TRANSFER AFFIDAVIT]
STATE OF _____________ )
) ss.:
COUNTY OF ___________ )
The undersigned, being first duly sworn, deposes and says as follows:
1. The undersigned is the __________ of ________________________ (the
"INVESTOR"), a [corporation duly organized] and existing under the laws of
_____________ on behalf of which he makes this affidavit.
2. The Investor either (i) is not, and is not acquiring the Offered
Notes on behalf of or with the assets of, an employee benefit plan or other
retirement plan or arrangement subject to Title I of ERISA or Section 4975 of
the Code, or (b) is, or is acquiring the Offered Notes on behalf of or with the
assets of, an employee benefit plan or other retirement plan or arrangement
subject to Title I of ERISA of Section 4975 of the Code and the conditions for
exemptive relief under at least one of the following prohibited transaction
class exemptions have been satisfied: Prohibited Transaction Class Exemption
("PTCE") 96-23 (relating to transactions effected by an "in-house asset
manager"), PTCE 95-60 (relating to transactions involving insurance company
general accounts, PTCE 91-38 (relating to transactions involving bank collective
investment funds), XXXX 00-0 (relating to transactions involving insurance
company pooled separate accounts), and PTCE 84-14 (relating to transactions
effected by a "qualified professional asset manager").
3. The Investor hereby acknowledges that under the terms of the
Indenture (the "AGREEMENT") between FFCA Franchise Loan Owner Trust 1998-1 and
LaSalle National Bank, as indenture trustee, dated as of August 14, 1998, no
transfer of the Notes shall be permitted to be made to any person unless the
Depositor and Owner Trustee have received a certificate from such transferee in
the form hereof.
[FOR TRANSFERS IN RELIANCE UPON RULE 144A]
4. The Investor is a "qualified institutional buyer" (as such term is
defined under Rule 144A under the Securities Act of 1933, as amended (the "1933
ACT"), and is acquiring the Offered Notes for its own account or as a fiduciary
or agent for others (which others also are "qualified institutional buyers").
The Investor is familiar with Rule 144A under the 1933 Act, and is aware that
the transferor of the Offered Notes and other parties intend to rely on the
statements made herein and the exemption from the registration requirements of
the 1933 Act provided by Rule 144A.
IN WITNESS WHEREOF, the Investor has caused this instrument to be
executed on its behalf, pursuant to proper authority, by its duly authorized
officer, duly attested, this day of _____________, .
B-3-1
_______________________________
[Investor]
By: ___________________________
Name:
Title:
ATTEST:
__________________________
B-3-2
STATE OF _____________ )
) ss.:
COUNTY OF ___________ )
Personally appeared before me the above-named _________________, known
or proved to me to be the same person who executed the foregoing instrument and
to be the ___________ of the Investor, and acknowledged that he executed the
same as his free act and deed and the free act and deed of the Investor.
Subscribed and sworn before me this ______ day of _______________,
199__.
____________________________________
NOTARY PUBLIC
My commission expires the
__________ day of ______________, __
B-3-3
EXHIBIT C
THIS NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED
(THE "1933 ACT"), OR ANY STATE SECURITIES LAWS. NEITHER THIS NOTE NOR ANY
INTEREST OR PARTICIPATION HEREIN MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED,
PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH
REGISTRATION, UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO,
REGISTRATION.
THE HOLDER OF THIS NOTE BY ITS ACCEPTANCE HEREOF AGREES TO OFFER, SELL OR
OTHERWISE TRANSFER SUCH NOTE ONLY (A) PURSUANT TO A REGISTRATION STATEMENT WHICH
HAS BEEN DECLARED EFFECTIVE UNDER THE 1933 ACT, (B) FOR SO LONG AS THIS NOTE IS
ELIGIBLE FOR RESALE PURSUANT TO RULE 144A UNDER THE 1933 ACT, TO A PERSON IT
REASONABLY BELIEVES IS A "QUALIFIED INSTITUTIONAL BUYER" AS DEFINED IN RULE 144A
UNDER THE 1933 ACT THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A
QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE TRANSFER IS BEING
MADE IN RELIANCE ON RULE 144A OR (C) TO AN INSTITUTIONAL "ACCREDITED INVESTOR"
WITHIN THE MEANING OF SUBPARAGRAPH (A)(1), (2), (3) OR (7) OF RULE 501 UNDER THE
1933 ACT THAT IS ACQUIRING THE NOTE FOR ITS OWN ACCOUNT, OR FOR THE ACCOUNT OF
SUCH AN INSTITUTIONAL "ACCREDITED INVESTOR," FOR INVESTMENT PURPOSES AND NOT
WITH A VIEW TO, OR FOR OFFER OR SALE IN CONNECTION WITH, ANY DISTRIBUTION IN
VIOLATION OF THE 1933 ACT, IN EACH CASE IN COMPLIANCE WITH THE REQUIREMENTS OF
THE INDENTURE AND APPLICABLE STATE SECURITIES LAWS.
THIS NOTE MAY NOT BE TRANSFERRED UNLESS THE OWNER TRUSTEE HAS RECEIVED A
CERTIFICATE FROM THE TRANSFEREE TO THE EFFECT THAT EITHER (I) THE TRANSFEREE IS
NOT AN EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT PLAN OR ARRANGEMENT SUBJECT TO
TITLE I OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED, OR
SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (EACH, A "PLAN"),
AND IS NOT ACTING ON BEHALF OF OR INVESTING THE ASSETS OF A PLAN OR (II) IF THE
TRANSFEREE IS A PLAN, OR IS ACTING ON BEHALF OF OR INVESTING THE ASSETS OF A
PLAN, THE CONDITIONS FOR EXEMPTIVE RELIEF UNDER AT LEAST ONE OF THE FOLLOWING
PROHIBITED TRANSACTION CLASS EXEMPTIONS HAVE BEEN SATISFIED: PROHIBITED
TRANSACTION CLASS EXEMPTION ("PTCE") 96-23 (RELATING TO TRANSACTIONS EFFECTED BY
AN "IN-HOUSE ASSET MANAGER"), PTCE 95-60 (RELATING TO TRANSACTIONS INVOLVING
INSURANCE COMPANY GENERAL ACCOUNTS), PTCE 91-38 (RELATING TO TRANSACTIONS
INVOLVING BANK COLLECTIVE INVESTMENT FUNDS), PTCE 90-1 (RELATING TO TRANSACTIONS
INVOLVING INSURANCE COMPANY POOLED SEPARATE ACCOUNTS) AND PTCE 84-14 (RELATING
TO TRANSACTIONS EFFECTED BY A "QUALIFIED PROFESSIONAL ASSET MANAGER"). EACH
TRANSFEREE OF A BENEFICIAL INTEREST HEREIN THAT IS A PLAN, OR IS A PERSON ACTING
ON BEHALF OF OR INVESTING THE ASSETS OF A PLAN, SHALL BE DEEMED TO MAKE THE
REPRESENTATION SET FORTH UNDER (II) ABOVE.
C-1
