EXHIBIT 10.2
EXECUTION COPY
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INDEMNIFICATION AGREEMENT
among
FINANCIAL SECURITY ASSURANCE INC.,
AFS FUNDING CORP.
and
BANC OF AMERICA SECURITIES LLC
Dated as of January 25, 2001
$200,000,000 Class A-1 5.5325% Asset Backed Notes
$515,000,000 Class A-2 5.36% Asset Backed Notes
$214,000,000 Class A-3 Floating Rate Asset Backed Notes
$471,000,000 Class A-4 Floating Rate Asset Backed Notes
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TABLE OF CONTENTS
PAGE
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Section 1. Definitions........................................................1
Section 2. Representations, Warranties and Agreements of Financial Security...3
Section 3. Representations, Warranties and Agreements of the Underwriters.....5
Section 4. Indemnification....................................................6
Section 5. Indemnification Procedures.........................................7
Section 6. Contribution.......................................................8
Section 7. Miscellaneous......................................................8
EXHIBIT A - Opinion of Assistant General Counsel
INDEMNIFICATION AGREEMENT
INDEMNIFICATION AGREEMENT dated as of January 25, 2001, among FINANCIAL
SECURITY ASSURANCE INC. ("FINANCIAL SECURITY"), AFS FUNDING CORP., (the
"SELLER") and BANC OF AMERICA SECURITIES LLC as the Representative (as defined
below):
Section 1. DEFINITIONS. For purposes of this Agreement, the following terms
shall have the meanings provided below:
"AGREEMENT" means this Indemnification Agreement, as amended from time to
time.
"FEDERAL SECURITIES LAWS" means the Securities Act, the Securities Exchange
Act of 1934, the Trust Indenture Act of 1939, the Investment Company Act of
1940, the Investment Advisers Act of 1940 and the Public Utility Holding Company
Act of 1935, each as amended from time to time, and the rules and regulations in
effect from time to time under such Acts.
"FINANCIAL SECURITY AGREEMENTS" means this Agreement, the Stock Pledge
Agreement, the Spread Account Agreement, the Spread Account Agreement Supplement
and the Insurance Agreement.
"FINANCIAL SECURITY INFORMATION" has the meaning provided in Section 2(g)
hereof.
"FINANCIAL SECURITY PARTY" means any of Financial Security, its parent,
subsidiaries and affiliates, and any shareholder, director, officer, employee,
agent or "controlling person" (as such term is used in the Securities Act) of
any of the foregoing.
"INDEMNIFIED PARTY" means any party entitled to any indemnification
pursuant to Section 4 hereof.
"INDEMNIFYING PARTY" means any party required to provide indemnification
pursuant to Section 4 hereof.
"INSURANCE AGREEMENT" means the Insurance and Indemnity Agreement, dated as
of January 25, 2001 among Financial Security, the Trust, AmeriCredit Financial
Services, Inc., AFS Funding Corp. and AmeriCredit Corp.
"INSURANCE POLICY" means the financial guaranty insurance policy delivered
by Financial Security with respect to the Securities.
"LOSSES" means (a) any actual out-of-pocket damages incurred by the party
entitled to indemnification or contribution hereunder, (b) any actual
out-of-pocket costs or expenses incurred by such party, including reasonable
fees or expenses of its counsel and other expenses incurred in connection with
investigating or defending any claim, action or other proceeding which entitle
such party to be indemnified hereunder (subject to the limitations set forth in
Section 5 hereof), to the extent not paid, satisfied or reimbursed from funds
provided by any other Person other than an affiliate of such party (provided
that the foregoing shall not create or imply any obligation to pursue recourse
against any such other Person), plus (c) interest on the
amount paid by the party entitled to indemnification or contribution from the
date of such payment to the date of payment by the party who is obligated to
indemnify or contribute hereunder at the statutory rate applicable to
judgments for breach of contract.
"OFFERING DOCUMENT" means the Prospectus and any other material or
documents delivered by the Underwriters to any Person in connection with the
offer or sale of the Securities.
"PERSON" means any individual, partnership, joint venture, corporation,
trust, unincorporated organization or other organization or entity (whether
governmental or private).
"PROSPECTUS" means, collectively, the Prospectus relating to the Securities
dated January 17, 2001 and the Prospectus Supplement dated January 23, 2001 (the
"Prospectus Supplement") relating to the Securities.
"REPRESENTATIVE" means Banc of America Securities LLC, as representative of
the Underwriters.
"SECURITIES" means the Trust's $200,000,000 Class A-1 5.5325% Asset Backed
Notes, $515,000,000 Class A-2 5.36% Asset Backed Notes, $214,000,000 Class A-3
Floating Rate Asset Backed Notes, and $471,000,000 Class A-4 Floating Rate Asset
Backed Notes issued pursuant to the Series 2001-A Indenture.
"SECURITIES ACT" means the Securities Act of 1933, as amended from time to
time.
"SELLER PARTY" means any of the Seller, its parent, subsidiaries and
affiliates and any shareholder, director, officer, employee, agent or
"controlling person" (as such term is used in the Securities Act) of any of the
foregoing.
"SPREAD ACCOUNT AGREEMENT" means the Spread Account Agreement, as amended
and restated, dated as of May 11, 1998, as amended as of October 25, 1999, as
further amended as of May 22, 2000, as further amended as of November 29, 2000,
among Financial Security, AFS Funding Corp., the collateral agent named therein
and the trustees specified therein, as the same may be amended, supplemented or
otherwise modified in accordance with the terms thereof.
"SPREAD ACCOUNT AGREEMENT SUPPLEMENT" means the Series 2001-A Supplement to
Spread Account Agreement, dated as of January 25, 2001, among Financial
Security, AFS Funding Corp., the collateral agent named therein and the trustees
specified therein.
"STOCK PLEDGE AGREEMENT" means the Stock Pledge Agreement, dated as of May
1, 1996 among Financial Security, AmeriCredit Financial Services, Inc. and the
collateral agent named therein, as the same may be amended, supplemented or
otherwise modified in accordance with the terms thereof.
"SWAP AGREEMENTS"means the ISDA Master Interest Rate Swap Agreements dated
February 6, 2001 between the Trust and the Swap Provider, including the Schedule
thereto, the Credit Support Annex thereto, the Confirmations relating to each of
the Class A-3 Notes and the Class A-4 Notes, and together with any replacement
swap agreements thereafter approved by the Insurer.
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"SWAP COUNTERPARTY" means Credit Suisse First Boston International.
"SWAP PROVIDER POLICY" means the financial guaranty insurance policy,
including any endorsements thereto, issued by Financial Security with respect to
the Swap Agreements.
"TRUST" means AmeriCredit Automobile Receivables Trust 2001-A.
"UNDERWRITER INFORMATION" has the meaning provided in Section 3(c) hereof.
"UNDERWRITER PARTY" means any of the Underwriters, its respective parent,
subsidiaries and affiliates and any shareholder, director, officer, employee,
agent or "controlling person" (as such item is used in the Securities Act) of
any of the foregoing.
"UNDERWRITERS" means Banc of America Securities LLC, Barclays Capital Inc.,
Bear, Xxxxxxx & Co. Inc., Chase Securities Inc. and Deutsche Banc Alex. Xxxxx
Inc., as underwriters.
"UNDERWRITING AGREEMENT" means the Underwriting Agreement, dated as of
January 23, 2001 among the Seller, AmeriCredit Financial Services, Inc. and the
Representative.
Section 2. REPRESENTATIONS, WARRANTIES AND AGREEMENTS OF FINANCIAL
SECURITY. Financial Security represents, warrants and agrees as follows:
(a) ORGANIZATION, ETC. Financial Security is a stock insurance company
duly organized, validly existing and authorized to transact financial
guaranty insurance business under the laws of the State of New York.
(b) AUTHORIZATION, ETC. The Insurance Policy, the Swap Provider Policy
and the Financial Security Agreements have been duly authorized, executed
and delivered by Financial Security.
(c) VALIDITY, ETC. The Insurance Policy, the Swap Provider Policy and
the Financial Security Agreements constitute valid and binding obligations
of Financial Security, enforceable against Financial Security in accordance
with their terms, subject, as to the enforcement of remedies, to
bankruptcy, insolvency, reorganization, rehabilitation, moratorium and
other similar laws affecting the enforceability of creditors' rights
generally applicable in the event of the bankruptcy or insolvency of
Financial Security and to the application of general principles of equity
and subject, in the case of this Agreement, to principles of public policy
limiting the right to enforce the indemnification provisions contained
herein.
(d) EXEMPTION FROM REGISTRATION. The Insurance Policy and the Swap
Provider Policy are exempt from registration under the Securities Act.
(e) NO CONFLICTS. Neither the execution or delivery by Financial
Security of the Insurance Policy, the Swap Provider Policy or the Financial
Security Agreements, nor the performance by Financial Security of its
obligations thereunder, will conflict with any provision of the certificate
of incorporation or the bylaws of Financial Security nor result in a breach
of, or constitute a default under, any material agreement or other
instrument
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to which Financial Security is a party or by which any of its property
is bound nor violate any judgment, order or decree applicable to
Financial Security of any governmental or regulatory body, administrative
agency, court or arbitrator having jurisdiction over Financial Security
(except that, in the published opinion of the Securities and Exchange
Commission, the indemnification provisions of this Agreement, insofar as
they relate to indemnification for liabilities arising under the Securities
Act, are against public policy as expressed in the Securities Act and are
therefore unenforceable).
(f) FINANCIAL INFORMATION. The consolidated balance sheets of
Financial Security as of December 31, 1999 and December 31, 1998 and the
related consolidated statements of income, changes in shareholder's equity
and cash flows for the fiscal years then ended, and the interim
consolidated balance sheet of Financial Security as of September 30, 2000,
and the related statements of income, changes in shareholder equity and
cash flows for the interim period then ended, which are incorporated by
reference in the Prospectus, fairly present in all material respects the
financial condition of Financial Security as of such dates and for such
periods in accordance with generally accepted accounting principles
consistently applied (subject as to interim statements to normal year-end
adjustments) and since the date of the most current interim consolidated
balance sheet referred to above there has been no change in the financial
condition of Financial Security which would materially and adversely affect
its ability to perform its obligations under the Insurance Policy or the
Swap Provider Policy.
(g) FINANCIAL SECURITY INFORMATION. The information in the Prospectus
Supplement set forth under the caption "The Insurer" (as revised from time
to time in accordance with the provisions hereof, the "FINANCIAL SECURITY
INFORMATION") is limited and does not purport to provide the scope of
disclosure required to be included in a prospectus with respect to a
registrant in connection with the offer and sale of securities of such
registrant registered under the Securities Act. Within such limited scope
of disclosure, however, as of the date of the Prospectus Supplement and as
of the date hereof, the Financial Security Information does not contain any
untrue statement of a material fact, or omit to state a material fact
necessary to make the statements contained therein, in the light of the
circumstances under which they were made, not misleading.
(h) ADDITIONAL INFORMATION. Financial Security will furnish to the
Underwriters or the Seller, upon request of the Underwriters or the Seller,
as the case may be, copies of Financial Security's most recent financial
statements (annual or interim, as the case may be) which fairly present in
all material respects the financial condition of Financial Security as of
the dates and for the periods indicated, in accordance with generally
accepted accounting principles consistently applied except as noted therein
(subject, as to interim statements, to normal year-end adjustments). In
addition, if the delivery of a Prospectus relating to the Securities is
required at any time prior to the expiration of nine months after the time
of issue of the Prospectus in connection with the offering or sale of the
Securities, the Seller or the Underwriters will notify Financial Security
of such requirement to deliver a Prospectus and Financial Security will
promptly provide the Underwriters and the Seller with any revisions to the
Financial Security Information that are in the judgment of Financial
Security necessary to prepare an amended Prospectus or a supplement to the
Prospectus.
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(i) OPINION OF COUNSEL. Financial Security will furnish to the
Underwriters and the Seller on the closing date for the sale of the
Securities an opinion of its Assistant General Counsel, to the effect set
forth in Exhibit A attached hereto, dated such closing date and addressed
to the Seller and the Underwriters.
(j) CONSENTS AND REPORTS OF INDEPENDENT ACCOUNTANTS. Financial
Security will furnish to the Underwriters and the Seller, upon request, as
comfort from its independent accountants in respect of its financial
condition, (i) at the expense of the Person specified in the Insurance
Agreement, a copy of the Prospectus, including either a manually signed
consent or a manually signed report of Financial Security's independent
accountants and (ii) the quarterly review letter by Financial Security's
independent accountants in respect of the most recent interim financial
statements of Financial Security.
Nothing in this Agreement shall be construed as a representation or warranty by
Financial Security concerning the rating of its insurance financial strength by
Xxxxx'x Investors Service, its insurer financial strength by Standard & Poor's
Ratings Services and Standard & Poor's (Australia) Pty. Ltd., its claims-paying
ability by Fitch IBCA, Inc. and Japan Rating and Investment Information, Inc. or
any other rating assigned by a rating agency (collectively, the "RATING
AGENCIES"). The Rating Agencies, in assigning such ratings, take into account
facts and assumptions not described in the Prospectus and the facts and
assumptions which are considered by the Rating Agencies, and the ratings issued
thereby, are subject to change over time.
Section 3. REPRESENTATIONS, WARRANTIES AND AGREEMENTS OF THE UNDERWRITERS.
Each of the Underwriters represents, warrants and agrees as follows:
(a) COMPLIANCE WITH LAWS. Such Underwriter will comply in all material
respects with all legal requirements in connection with offers and sales of
the Securities and make such offers and sales in the manner provided in the
Prospectus.
(b) OFFERING DOCUMENT. Such Underwriter will not use, or distribute to
other broker-dealers for use, any Offering Document in connection with the
offer and sale of the Securities unless such Offering Document includes
such information as has been furnished by Financial Security for inclusion
therein and the information therein concerning Financial Security has been
approved by Financial Security in writing. Financial Security hereby
consents to the information in respect of Financial Security included in
the Prospectus. Each Offering Document will include the following
statement:
"The Policy is not covered by the property/casualty insurance
security fund specified in Article 76 of the New York
Insurance Law".
Each Offering Document including financial information with respect to
Financial Security prepared in accordance with generally accepted
accounting principles (but excluding any Offering Document in which
such financial statements are incorporated by
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reference) will include the following statement immediately preceding
such financial information:
"The New York State Insurance Department recognizes only
statutory accounting practices for determining and reporting
the financial condition and results of operations of an
insurance company, for determining its solvency under the New
York Insurance Law, and for determining whether its financial
condition warrants the payment of a dividend to its
stockholders. No consideration is given by the New York State
Insurance Department to financial statements prepared in
accordance with generally accepted accounting principles in
making such determinations."
(c) UNDERWRITER INFORMATION. All material provided by the Underwriters
for inclusion in the Prospectus (as revised from time to time, the
"UNDERWRITER INFORMATION"), insofar as such information relates to the
Underwriters, is true and correct in all material respects. In respect of
the Prospectus Supplement, the Underwriter Information is limited to the
information set forth (i) on the cover page of the Prospectus Supplement in
the table containing the price to the public, the underwriting discount and
the proceeds to the Seller with respect to the Securities and (ii) in the
paragraphs immediately following the tables under the caption
"Underwriting".
Section 4. INDEMNIFICATION.
(a) Financial Security agrees, upon the terms and subject to the
conditions provided herein, to indemnify, defend and hold harmless each
Seller Party and each Underwriter Party against (i) any and all Losses
incurred by them with respect to the offer and sale of the Securities and
resulting from Financial Security's breach of any of its representations,
warranties or agreements set forth in Section 2 hereof and (ii) any and all
Losses to which any Seller Party or Underwriter Party may become subject,
under the Securities Act or otherwise, insofar as such Losses arise out of
or result from an untrue statement of a material fact contained in any
Offering Document or the omission to state therein a material fact required
to be stated therein or necessary to make the statements therein not
misleading, in each case to the extent, but only to the extent, that such
untrue statement or omission was made in the Financial Security Information
included therein in accordance with the provisions hereof.
(b) Each of the Underwriters, agrees, upon the terms and subject to
the conditions provided herein, to indemnify, defend and hold harmless each
Financial Security Party and each Seller Party against (i) any and all
Losses incurred by them with respect to the offer and sale of the
Securities and resulting from the Underwriters' breach of any of its
representations, warranties or agreements set forth in Section 3 hereof and
(ii) any and all Losses to which any Financial Security Party or Seller
Party may become subject, under the Securities Act or otherwise, insofar as
such Losses arise out of or result from an untrue statement of a material
fact contained in any Offering Document or the omission to state therein a
material fact required to be stated therein or necessary to make
6
the statements therein not misleading, in each case to the extent, but
only to the extent, that such untrue statement or omission was made in the
Underwriter Information included therein.
(c) Upon the incurrence of any Losses for which a party is entitled to
indemnification hereunder, the Indemnifying Party shall reimburse the
Indemnified Party promptly upon establishment by the Indemnified Party to
the Indemnifying Party of the Losses incurred.
Section 5. INDEMNIFICATION PROCEDURES. Except as provided below in Section
6 with respect to contribution, the indemnification provided herein by an
Indemnifying Party shall be the exclusive remedy of any and all Indemnified
Parties for the breach of a representation, warranty or agreement hereunder by
an Indemnifying Party; PROVIDED, HOWEVER, that each Indemnified Party shall be
entitled to pursue any other remedy at law or in equity for any such breach so
long as the damages sought to be recovered shall not exceed the Losses incurred
thereby resulting from such breach. In the event that any action or regulatory
proceeding shall be commenced or claim asserted which may entitle an Indemnified
Party to be indemnified under this Agreement, such party shall give the
Indemnifying Party written or telegraphic notice of such action or claim
reasonably promptly after receipt of written notice thereof. The Indemnifying
Party shall be entitled to participate in and, upon notice to the Indemnified
Party, assume the defense of any such action or claim in reasonable cooperation
with, and with the reasonable cooperation of, the Indemnified Party. The
Indemnified Party will have the right to employ its own counsel in any such
action in addition to the counsel of the Indemnifying Party, but the fees and
expenses of such counsel will be at the expense of such Indemnified Party,
unless (a) the employment of counsel by the Indemnified Party at its expense has
been authorized in writing by the Indemnifying Party, (b) the Indemnifying Party
has not in fact employed counsel satisfactory to Financial Security to assume
the defense of such action within a reasonable time after receiving notice of
the commencement of the action, or (c) the named parties to any such action or
proceeding (including any impleaded parties) include both the Indemnifying Party
and one or more Indemnified Parties, and the Indemnified Parties shall have been
advised by counsel that (A) there may be one or more legal defenses available to
them which are different from or additional to those available to the
Indemnifying Party and (B) the representation of the Indemnifying Party and such
Indemnified Parties by the same counsel would be inappropriate or contrary to
prudent practice (in which case, if such Indemnified Parties notify the
Indemnifying Party in writing that they elect to employ separate counsel at the
expense of the Indemnifying Party, the Indemnifying Party shall not have the
right to assume the defense of such action or proceeding on behalf of such
Indemnified Parties, it being understood, however, that the Indemnifying Party
shall not, in connection with any one such action or proceeding or separate but
substantially similar or related actions or proceedings in the same jurisdiction
arising out of the same general allegations or circumstances, be liable for the
reasonable fees and expenses of more than one separate firm of attorneys at any
time for all Seller Parties, one such firm for all Underwriter Parties and one
such firm for all Financial Security Parties, as the case may be, which firm
shall be designated in writing by the Seller in respect of the Seller Parties,
by the Underwriters in respect of the Underwriter Parties and by Financial
Security in respect of the Financial Security Parties), in each of which cases
the fees and expenses of counsel will be at the expense of the Indemnifying
Party and all such fees and expenses will be reimbursed promptly as they are
incurred. The Indemnifying Party shall not be
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liable for any settlement of any such claim or action unless the Indemnifying
Party shall have consented thereto or be in default in its obligations
hereunder. Any failure by an Indemnified Party to comply with the provisions
of this Section shall relieve the Indemnifying Party of liability only if
such failure is prejudicial to the position of the Indemnifying Party and
then only to the extent of such prejudice.
Section 6. CONTRIBUTION.
(a) To provide for just and equitable contribution if the
indemnification provided by any Indemnifying Party is determined to be
unavailable for any Indemnified Party (other than due to application of
this Section), each Indemnifying Party shall contribute to the Losses
arising from any breach of any of its representations, warranties or
agreements contained in this Agreement on the basis of the relative fault
of each of the parties as set forth in Section 6(b) below; PROVIDED,
HOWEVER, that an Indemnifying Party shall in no event be required to
contribute to all Indemnified Parties an aggregate amount in excess of the
Losses incurred by such Indemnified Parties resulting from the breach of
representations, warranties or agreements contained in this Agreement.
(b) The relative fault of each Indemnifying Party, on the one hand,
and of each Indemnified Party, on the other, shall be determined by
reference to, among other things, whether the breach of, or alleged breach
of, any representations, warranties or agreements contained in this
Agreement relates to information supplied by, or action within the control
of, the Indemnifying Party or the Indemnified Party and the parties'
relative intent, knowledge, access to information and opportunity to
correct or prevent such breach.
(c) The parties agree that Financial Security shall be solely
responsible for the Financial Security Information and the Underwriters
shall be solely responsible for the Underwriter Information and that the
balance of each Offering Document shall be the responsibility of the
Seller.
(d) Notwithstanding anything in this Section 6 to the contrary, the
Underwriters shall not be required to contribute an amount in excess of the
amount by which the total price of the Securities underwritten by the
Underwriters exceeds the amount of any damages that the Underwriters have
otherwise been required to pay in respect of such untrue statement or
omission.
(e) No person guilty of fraudulent misrepresentation (within the
meaning of Section 11(f) of the Securities Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation.
(f) Upon the incurrence of any Losses entitled to contribution
hereunder, the contributor shall reimburse the party entitled to
contribution promptly upon establishment by the party entitled to
contribution to the contributor of the Losses incurred.
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Section 7. MISCELLANEOUS.
(a) NOTICES. All notices and other communications provided for under
this Agreement shall be delivered to the address set forth below or to such
other address as shall be designated by the recipient in a written notice
to the other party or parties hereto.
If to Financial Security: Financial Security Assurance Inc.
000 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Senior Vice President - Transaction
Oversight Department (with a copy to the
attention of the General Counsel)
Re: AmeriCredit Automobile Receivables
Trust 2001-A
Confirmation: (000) 000-0000
Telecopy Nos.: (000) 000-0000,
(000) 000-0000
If to the Seller: AFS Funding Corp.
000 Xxxxxx Xxxx, Xxxxx 000
Xxxx, Xxxxxx 00000
Attention: General Counsel
Confirmation: (000) 000-0000
If to the Underwriters: Banc of America Securities LLC
000 Xxxxx Xxxxx Xxxxxx
XX 1-007-10-07
Xxxxxxxxx, Xxxxx Xxxxxxxx 00000
Attention: Xxxx Xxxxxx, Global-Asset Backed
Securitization
Confirmation: (000) 000-0000
Telecopy No.: (000) 000-0000
(b) GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED
IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
(c) ASSIGNMENTS. This Agreement may not be assigned by any party
without the express written consent of each other party. Any assignment
made in violation of this Agreement shall be null and void.
(d) AMENDMENTS. Amendments of this Agreement shall be in writing
signed by each party hereto.
(e) SURVIVAL, ETC. The indemnity and contribution agreements contained
in this Agreement shall remain operative and in full force and effect,
regardless of (i) any investigation made by or on behalf of any
Indemnifying Party, (ii) the issuance of the Securities or (iii) any
termination of this Agreement, the Insurance Policy or the Swap Provider
Policy. The indemnification provided in this Agreement will be in addition
to
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any liability which the parties may otherwise have and shall in no way
limit any obligations of the Seller under the Underwriting Agreement or the
Insurance Agreement.
(f) COUNTERPARTS. This Agreement may be executed in counterparts by
the parties hereto, and all such counterparts shall constitute one and the
same instrument.
[THE REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK]
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IN WITNESS WHEREOF, the parties hereto have caused this Indemnification
Agreement to be duly executed and delivered as of the date first above written.
FINANCIAL SECURITY ASSURANCE INC.
By: /s/ Xxxx Xxxxxxxxxxx
----------------------------------------------
Name: Xxxx Xxxxxxxxxxx
------------------------------------
Title: Authorized Officer
AFS FUNDING CORP.
By: /s/ Xxxxxxx X. Xxxxxx
----------------------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: Executive Vice President and Treasurer
BANC OF AMERICA SECURITIES LLC
By: /s/ Xxxx Xxxxxx
----------------------------------------------
Name: Xxxx Xxxxxx
Title: Principal
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EXHIBIT A
OPINION OF ASSISTANT GENERAL COUNSEL
Based upon the foregoing, I am of the opinion that:
1. Financial Security is a stock insurance company duly organized,
validly existing and authorized to transact financial guaranty insurance
business under the laws of the State of New York.
2. The Insurance Policy, the Swap Provider Policy and the Financial
Security Agreements have been duly authorized, executed and delivered by
Financial Security.
3. The Insurance Policy, the Swap Provider Policy and the Financial
Security Agreements constitute valid and binding obligations of Financial
Security, enforceable against Financial Security in accordance with their terms,
subject, as to the enforcement of remedies, to bankruptcy, insolvency,
reorganization, rehabilitation, moratorium and other similar laws affecting the
enforceability of creditors' rights generally applicable in the event of the
bankruptcy or insolvency of Financial Security and to the application of general
principles of equity and subject, in the case of the Indemnification Agreement,
to principles of public policy limiting the right to enforce the indemnification
provisions contained therein insofar as they relate to indemnification for
liabilities arising under applicable securities laws.
4. The Insurance Policy and the Swap Provider Policy are exempt from
registration under the Securities Act of 1933, as amended (the "ACT").
5. Neither the execution or delivery by Financial Security of the
Insurance Policy, the Swap Provider Policy or the Financial Security Agreements,
nor the performance by Financial Security of its obligations thereunder, will
conflict with any provision of the certificate of incorporation or the bylaws of
Financial Security or violate any law or regulation, which violation would
impair the binding effect or enforceability of the Insurance Policy or the Swap
Provider Policy or any of the Agreements or, to the best of my knowledge, result
in a breach of, or constitute a default under, any agreement or other instrument
to which Financial Security is a party or by which it or any of its property is
bound or, to the best of my knowledge, violate any judgment, order or decree
applicable to Financial Security of any governmental or regulatory body,
administrative agency, court or arbitrator having jurisdiction over Financial
Security (except that in the published opinion of the Securities and Exchange
Commission the indemnification provisions of the Indemnification Agreement,
insofar as they relate to indemnification for liabilities arising under the Act,
are against public policy as expressed in the Act and are therefore
unenforceable).
In addition, please be advised that I have reviewed the description of
Financial Security under the caption "The Insurer" in the Prospectus (the
"OFFERING DOCUMENT") of the Seller with respect to the Securities. The
information provided in the Offering Document with respect to Financial Security
is limited and does not purport to provide the scope of disclosure required to
be included in a prospectus with respect to a registrant under the Act in
connection with the
A-1
public offer and sale of securities of such registrant. Within such limited
scope of disclosure, however, there has not come to my attention any
information which would cause me to believe that the description of Financial
Security referred to above, as of the date of the Offering Document or as of
the date of this opinion, contained or contains any untrue statement of a
material fact or omitted or omits to state a material fact necessary to make
the statements therein, in the light of the circumstances under which they
were made, not misleading (except that I express no opinion with respect to
any financial statements or other financial information contained or referred
to therein).
A-2
