EXECUTION COPY
HOME LOAN TRUST 2006-HI2
ISSUER
AND
JPMORGAN CHASE BANK, NATIONAL ASSOCIATION
INDENTURE TRUSTEE
INDENTURE
DATED AS OF MAY 25, 2006
__________________________________________
HOME LOAN-BACKED NOTES, SERIES 2006-HI2
_____________
ARTICLE I DEFINITIONS...............................................................2
Section 1.01. Definitions.......................................................2
Section 1.02. Incorporation by Reference of Trust Indenture Act.................2
Section 1.03. Rules of Construction.............................................2
ARTICLE II ORIGINAL ISSUANCE OF NOTES................................................3
Section 2.01. Form..............................................................3
Section 2.02. Execution, Authentication and Delivery............................3
ARTICLE III COVENANTS.................................................................4
Section 3.01. Collection of Payments with respect to the Home Loans.............4
Section 3.02. Maintenance of Office or Agency...................................4
Section 3.03. Money for Payments To Be Held in Trust; Paying Agent..............4
Section 3.04. Existence.........................................................5
Section 3.05. Payment of Principal and Interest; Defaulted Interest.............6
Section 3.06. Protection of Trust Estate........................................8
Section 3.07. Opinions as to Trust Estate.......................................8
Section 3.08. Performance of Obligations; Servicing Agreement...................9
Section 3.09. Negative Covenants................................................9
Section 3.10. Annual Statement as to Compliance................................10
Section 3.11. Recording of Assignments.........................................10
Section 3.12. Representations and Warranties Concerning the Home Loans.........10
Section 3.13. Assignee of Record of the Home Loans.............................10
Section 3.14. Master Servicer as Agent and Bailee of the Indenture Trustee.....11
Section 3.15. Investment Company Act...........................................11
Section 3.16. Issuer May Consolidate, etc......................................11
Section 3.17. Successor or Transferee..........................................13
Section 3.18. No Other Business................................................13
Section 3.19. No Borrowing.....................................................13
Section 3.20. Guarantees, Loans, Advances and Other Liabilities................13
Section 3.21. Capital Expenditures.............................................13
Section 3.22. Owner Trustee Not Liable for the Certificate or Related
Documents........................................................13
Section 3.23. Restricted Payments..............................................14
Section 3.24. Notice of Events of Default......................................14
Section 3.25. Further Instruments and Acts.....................................14
Section 3.26. Statements to Noteholders........................................14
Section 3.27. Payments under the Credit Enhancement Instrument.................14
Section 3.28. Reserved.........................................................15
Section 3.29. Determination of Class A-1 Note Rate.............................15
Section 3.30. Liquidation on Final Insured Payment Date........................15
Section 3.31. No Recourse......................................................15
Section 3.32. Additional UCC Representations and Warranties....................15
ARTICLE IV THE NOTES; SATISFACTION AND DISCHARGE OF INDENTURE.......................16
Section 4.01. The Notes........................................................16
Section 4.02. Registration of and Limitations on Transfer and Exchange of
Notes; Appointment of Certificate Registrar......................17
Section 4.03. Xxxxxxxxx, Xxxxxxxxx, Lost or Stolen Notes.......................18
Section 4.04. Persons Deemed Owners............................................18
Section 4.05. Cancellation.....................................................19
Section 4.06. Book Entry Notes.................................................19
Section 4.07. Notices to Depository............................................20
Section 4.08. Definitive Notes.................................................20
Section 4.09. Tax Treatment....................................................20
Section 4.10. Satisfaction and Discharge of Indenture..........................21
Section 4.11. Application of Trust Money.......................................22
Section 4.12. Subrogation and Cooperation......................................22
Section 4.13. Repayment of Monies Held by Paying Agent.........................23
Section 4.14. Temporary Notes..................................................23
ARTICLE V DEFAULT AND REMEDIES.....................................................23
Section 5.01. Events of Default................................................23
Section 5.02. Acceleration of Maturity; Rescission and Annulment...............23
Section 5.03. Collection of Indebtedness and Suits for Enforcement by
Indenture Trustee................................................24
Section 5.04. Remedies; Priorities.............................................26
Section 5.05. Optional Preservation of the Trust Estate........................28
Section 5.06. Limitation of Suits..............................................28
Section 5.07. Rights of Noteholders to Receive Principal and Interest..........29
Section 5.08. Restoration of Rights and Remedies...............................29
Section 5.09. Rights and Remedies Cumulative...................................29
Section 5.10. Delay or Omission Not a Waiver...................................30
Section 5.11. Control by the Credit Enhancer or the Noteholders................30
Section 5.12. Waiver of Past Defaults..........................................30
Section 5.13. Undertaking for Costs............................................31
Section 5.14. Waiver of Stay or Extension Laws.................................31
Section 5.15. Sale of Trust Estate.............................................31
Section 5.16. Action on Notes..................................................33
Section 5.17. Performance and Enforcement of Certain Obligations...............33
ARTICLE VI THE INDENTURE TRUSTEE....................................................34
Section 6.01. Duties of Indenture Trustee......................................34
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. Notice of Event 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.................................36
Section 6.09. Successor Indenture Trustee by Xxxxxx............................37
Section 6.10. Appointment of Co-Indenture Trustee or Separate Indenture
Trustee..........................................................37
Section 6.11. Eligibility; Disqualification....................................39
Section 6.12. Preferential Collection of Claims Against Issuer.................39
Section 6.13. Representations and Warranties...................................39
Section 6.14. Directions to Indenture Trustee..................................40
Section 6.15. Indenture Trustee May Own Securities.............................40
ARTICLE VII NOTEHOLDERS' LISTS AND REPORTS...........................................41
Section 7.01. Issuer to Furnish Indenture Trustee Names and Addresses of
Noteholders......................................................41
Section 7.02. Preservation of Information; Communications to Noteholders.......41
Section 7.03. Reports by Issuer................................................41
Section 7.04. Reports by Indenture Trustee.....................................42
Section 7.05. Exchange Act Reporting...........................................42
ARTICLE VIII ACCOUNTS, DISBURSEMENTS AND RELEASES.....................................42
Section 8.01. Collection of Money..............................................42
Section 8.02. Trust Accounts...................................................42
Section 8.03. Officer's Certificate............................................43
Section 8.04. Termination Upon Payment to Noteholders..........................43
Section 8.05. Release of Trust Estate..........................................43
Section 8.06. Surrender of Notes Upon Final Payment............................44
ARTICLE IX SUPPLEMENTAL INDENTURES..................................................44
Section 9.01. Supplemental Indentures Without Consent of Noteholders...........44
Section 9.02. Supplemental Indentures With Consent of Noteholders..............46
Section 9.03. Execution of Supplemental Indentures.............................47
Section 9.04. Effect of Supplemental Indenture.................................47
Section 9.05. Conformity with Trust Indenture Act..............................48
Section 9.06. Reference in Notes to Supplemental Indentures....................48
ARTICLE X MISCELLANEOUS............................................................48
Section 10.01. Compliance Certificates and Opinions, etc........................48
Section 10.02. Form of Documents Delivered to Indenture Trustee.................50
Section 10.03. Acts of Noteholders..............................................50
Section 10.04. Notices, etc., to Indenture Trustee, Issuer, Credit Enhancer
and Rating Agencies..............................................51
Section 10.05. Notices to Noteholders; Waiver...................................52
Section 10.06. Alternate Payment and Notice Provisions..........................52
Section 10.07. Conflict with Trust Indenture Act................................52
Section 10.08. Effect of Headings...............................................53
Section 10.09. Successors and Assigns...........................................53
Section 10.10. Separability.....................................................53
Section 10.11. Benefits of Indenture............................................53
Section 10.12. Legal Holidays...................................................53
Section 10.13. GOVERNING LAW....................................................53
Section 10.14. Counterparts.....................................................53
Section 10.15. Recording of Indenture...........................................53
Section 10.16. Issuer Obligation................................................54
Section 10.17. No Petition......................................................54
Section 10.18. Inspection.......................................................54
RECONCILIATION AND TIE BETWEEN TRUST INDENTURE
ACT OF 1939 AND INDENTURE PROVISIONS*
Trust Indenture
Act Section Indenture Section
310(a)(1)........................................... 6.11
(a)(2)............................................ 6.11
(a)(3)............................................ 6.10
(a)(4)............................................ Not Applicable
(a)(5)............................................ 6.11
(b)............................................... 6.08, 6.11
(c)............................................... Not Applicable
311(a)............................................. 6.12
(b).............................................. 6.12
(c).............................................. Not Applicable
312(a)............................................. 7.01, 7.02(a)
(b).............................................. 7.02(b)
(c).............................................. 7.02(c)
313(a)............................................. 7.04
(b).............................................. 7.04
(c).............................................. 7.03(a)(iii), 7.04
(d).............................................. 7.04
314(a)............................................. 3.10, 7.03(a)
(b)............................................. 3.07
(c)(1)........................................... 8.05(c), 10.01(a)
(c)(2)........................................... 8.05(c), 10.01(a)
(c)(3)........................................... Not Applicable
(d)(1)........................................... 8.05(c), 10.01(b)
(d)(2)........................................... 8.05(c), 10.01(b)
(d)(3)........................................... 8.05(c), 10.01(b)
(e).............................................. 10.01(a)
315(a)............................................. 6.01(b)
(b).............................................. 6.05
(c).............................................. 6.01(a)
(d).............................................. 6.01(c)
(d)(1)........................................... 6.01(c)
(d)(2)........................................... 6.01(c)
(d)(3)........................................... 6.01(c)
(e).............................................. 5.13
316(a)(1)(A)....................................... 5.11
316(a)(1)(B)....................................... 5.12
316(a)(2)........................................... Not Applicable
316(b).............................................. 5.07
317(a)(1)........................................... 5.04
317(a)(2)........................................... 5.03(d)
317(b).............................................. 3.03(a)
318(a).............................................. 10.07
This is the Indenture, dated as of May 25, 2006, between HOME LOAN TRUST 2006-HI2, a
Delaware statutory trust, as Issuer (the "Issuer"), and JPMorgan Chase Bank, National
Association, as Indenture Trustee (the "Indenture Trustee"),
WITNESSETH THAT:
Each party hereto agrees as follows for the benefit of the other party and for the
equal and ratable benefit of the Holders of the Issuer's Series 2006-HI2 Home Loan-Backed
Notes (the "Notes").
GRANTING CLAUSE
The Issuer and the Owner Trustee hereby Grant to the Indenture Trustee at the Closing
Date, as trustee for the benefit of the Holders of the Notes, all of the Issuer's and the
Owner Trustee's right, title and interest in and to whether now existing or hereafter
created (a) the Home Loans, (b) all funds on deposit from time to time in the Payment
Account and in all proceeds thereof; (c) all property securing the payment or performance of
the Home Loans and all supporting obligations for the Home Loans; and (d) all present and
future claims, demands, causes 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 and all payments on or under, and all proceeds of
every kind and nature whatsoever in the conversion thereof, voluntary or involuntary, into
cash or other liquid property, all cash proceeds, accounts, accounts receivable, notes,
drafts, acceptances, checks, deposit accounts, 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
(collectively, the "Trust Estate" or 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, equally and ratably
without prejudice, priority or distinction, and to secure compliance with the provisions of
this Indenture, all as provided in this Indenture.
The foregoing Grant shall inure to the benefit of the Credit Enhancer in respect of
draws made on the Credit Enhancement Instrument and amounts owing from time to time pursuant
to the Insurance Agreement (regardless of whether such amounts relate to the Notes or the
Certificates), and such Grant shall continue in full force and effect for the benefit of the
Credit Enhancer until all such amounts owing to it have been repaid in full.
The Indenture Trustee, as trustee on behalf of the Holders of the Notes: (i)
acknowledges such Grant, (ii) accepts the trust under this Indenture in accordance with the
provisions hereof, (iii) agrees to perform its duties as Indenture Trustee as required
herein and (iv) acknowledges receipt of the Credit Enhancement Instrument and shall hold
such Credit Enhancement Instrument in accordance with the terms of this Indenture for the
benefit of the Holders of the Notes.
ARTICLE I
DEFINITIONS
Section 1.01. Definitions. For all purposes of this Indenture, except as otherwise
expressly provided herein or unless the context otherwise requires, capitalized terms not
otherwise defined herein shall have the meanings assigned to such terms in the Definitions
attached hereto as Appendix A which is incorporated by reference herein. All other
capitalized terms used herein shall have the meanings specified herein.
Section 1.02. Incorporation by Reference of Trust Indenture Act. Whenever this Indenture
refers to a provision of the Trust Indenture Act (the "TIA"), the provision is incorporated
by reference in and made a part of this Indenture. The following TIA terms used in this
Indenture have the following meanings:
"Commission" means the Securities and Exchange Commission.
"indenture securities" means the Notes.
"indenture security holder" means a Noteholder.
"indenture to be qualified" means this Indenture.
"indenture trustee" or "institutional trustee" means the Indenture Trustee.
"obligor" on the indenture securities means the Issuer and any other obligor on the
indenture securities.
All other TIA terms used in this Indenture that are defined by the TIA, defined by
TIA reference to another statute or defined by Commission rule have the meaning assigned to
them by such definitions.
Section 1.03. Rules of Construction. Unless the context otherwise requires:
(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 generally accepted accounting principles as in effect from time to time;
(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; and
(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 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.
ARTICLE II
ORIGINAL ISSUANCE OF NOTES
Section 2.01. Form. The Notes, together with the Indenture Trustee's certificate of
authentication, shall be in substantially the form set forth in Exhibit A, with such
appropriate insertions, omissions, substitutions and other variations as are required or
permitted by this Indenture and may have such letters, numbers or other marks of
identification and such legends or endorsements placed thereon as may, consistently
herewith, be determined by the officers executing such Notes, as evidenced by their
execution of the Notes. Any portion of the text of any Note may be set forth on the reverse
thereof, with an appropriate reference thereto on the face of the Note.
The Notes shall be typewritten, printed, lithographed or engraved or produced by any
combination of these methods (with or without steel engraved borders), all as determined by
the Authorized Officers executing such Notes, as evidenced by their execution of such
Notes. The terms of the Notes set forth in Exhibit A are part of the terms of this
Indenture.
Section 2.02. Execution, Authentication and Delivery. The Notes shall be executed on
behalf of the Issuer by any of its Authorized Officers. 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 Issuer 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.
The Indenture Trustee shall upon Issuer Request authenticate and deliver Notes for
original issue in an aggregate initial principal amount of $91,861,000 with respect to the
Class A-1 Notes, $29,743,000 with respect to the Class A-2 Notes, $43,353,000 with respect
to the Class A-3 Notes and $72,434,000 with respect to the Class A-4 Notes.
The Notes shall be dated the date of their authentication. The Notes shall be
issuable as registered Notes. The Notes shall be issuable in the minimum initial Note
Balances of $100,000 and in integral multiples of $1 in excess thereof.
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 conclusive evidence, and the only evidence, that such Note has been
duly authenticated and delivered hereunder.
ARTICLE III
COVENANTS
Section 3.01. Collection of Payments with respect to the Home Loans. The Indenture
Trustee shall establish and maintain with itself the Payment Account in which the Indenture
Trustee shall, subject to the terms of this paragraph, deposit, on the same day as it is
received from the Master Servicer, each remittance received by the Indenture Trustee with
respect to the Home Loans. The Payment Account shall be a segregated account and an
Eligible Account. The Indenture Trustee shall make all payments of principal of and
interest on the Notes, subject to Section 3.03, as provided in Section 3.05 herein from
monies on deposit in the Payment Account.
Section 3.02. Maintenance of Office or Agency. The Issuer will maintain in the City of
New York, an office or agency where, subject to satisfaction of conditions set forth herein,
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. If at any time the Issuer shall fail to maintain any such office or
agency or shall fail to furnish the Indenture Trustee with the address thereof, such
surrenders, notices and demands may be made or served at the Corporate Trust Office, and the
Issuer hereby appoints the Indenture Trustee as its agent to receive all such surrenders,
notices and demands.
Section 3.03. Money for Payments To Be Held in Trust; Paying Agent. (a) As provided in
Section 3.01, all payments of amounts due and payable with respect to any Notes that are to
be made from amounts withdrawn from the Payment Account pursuant to Section 3.01 shall be
made on behalf of the Issuer by the Indenture Trustee or by the Paying Agent, and no amounts
so withdrawn from the Payment Account for payments of Notes shall be paid over to the Issuer
except as provided in this Section 3.03. The Issuer will cause each Paying Agent other than
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 and the Credit Enhancer written notice of any default by
the Issuer 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 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;
(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; and
(vi) deliver to the Indenture Trustee a copy of the report to Noteholders prepared with
respect to each Payment Date by the Master Servicer pursuant to Section 4.01 of the
Servicing Agreement.
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 Request 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.
Subject to applicable laws with respect to escheat of funds, 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 one year 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 an Authorized Newspaper, 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 may 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 Holders whose Notes have been called but have not been surrendered for
redemption or whose right to or interest in monies due and payable but not claimed is
determinable from the records of the Indenture Trustee or of any Paying Agent, at the last
address of record for each such Holder).
Section 3.04. Existence. The Issuer will keep in full effect its existence, rights and
franchises as a statutory 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, the Home Loans and each other instrument or agreement included in the
Trust Estate.
Section 3.05. Payment of Principal and Interest; Defaulted Interest. (a) On each Payment
Date from amounts on deposit in the Payment Account (other than amounts deposited
constituting prepayment charges), the Paying Agent shall pay to the Noteholders, the
Certificate Paying Agent on behalf of the Certificateholder and to other Persons the amounts
to which they are entitled, as set forth in the statements delivered to the Indenture
Trustee pursuant to Section 4.01 of the Servicing Agreement, as set forth below in the
following order of priority:
(i) to the Credit Enhancer, the Premium for the Credit Enhancement Instrument, plus any
unpaid Premium from any prior Payment Date (with interest thereon as provided in the
Insurance Agreement);
(ii) to the Noteholders, Accrued Note Interest for such Payment Date, on a pro rata basis,
based on the amount of Accrued Note Interest for such Payment Date, plus any Accrued
Note Interest remaining unpaid from any prior Payment Date, less any Prepayment
Interest Shortfalls and Relief Act Shortfalls allocated thereto as provided in
Section 3.05(d) below;
(iii) to the Noteholders as principal on the Notes, the Principal Collection Payment Amount
for such Payment Date, in the order described in Section 3.05(f) below, until the
Note Balances thereof have been reduced to zero;
(iv) to the Noteholders as principal on the Notes, the Liquidation Loss Payment Amount for
such Payment Date, in the order described in Section 3.05(f) below, until the Note
Balances thereof have been reduced to zero;
(v) to the Credit Enhancer, to reimburse it for prior draws made on the Credit
Enhancement Instrument (with interest thereon as provided in the Insurance Agreement);
(vi) to the Noteholders as principal on the Notes, the Reserve Increase Amount for such
Payment Date, in the order described in Section 3.05(f) below, until the Note
Balances thereof have been reduced to zero;
(vii) to the Credit Enhancer, any other amounts owed to the Credit Enhancer pursuant to the
Insurance Agreement; and
(viii) any remaining amount and any amounts constituting prepayment charges to the
Certificate Paying Agent, on behalf of the holders of the Certificates;
provided, however, in the event that on a Payment Date a Credit Enhancer Default shall have
occurred and be continuing, (a) no payments will be made to the Credit Enhancer pursuant to
clause (v) above until all Insured Payments that are due and required to be paid by the
Credit Enhancer on the Notes on such Payment Date or were due and required to be paid by the
Credit Enhancer on any prior Payment Date have been paid in full and (b) any amounts payable
to the Credit Enhancer pursuant to clause (v) shall instead be paid pursuant to clause
(vii). In addition, on the Final Insured Payment Date or other final Payment Date (including
the Payment Date following any purchase by the Master Servicer of the Home Loans pursuant to
Section 8.08 of the Servicing Agreement), the amount to be paid pursuant to clause (ii)
above shall be equal to the aggregate Note Balance of the Notes immediately prior to such
Payment Date.
(b) On each Payment Date, the Certificate Paying Agent shall deposit in the Certificate
Distribution Account all amounts it received pursuant to this Section 3.05 for the purpose
of distributing such funds to the Certificateholder.
(c) The amounts paid to Noteholders shall be paid to the Notes in accordance with the
applicable percentage as set forth in the definition of Note Rate. Interest will accrue on
the Notes (other than the Class A-1 Notes) on the basis of a 360-day year consisting of
twelve 30-day months. Interest will accrue on the Class A-1 Notes on the basis of a 360-day
year and the actual number of days in the related Interest Accrual Period.
(d) To the extent the amount available for interest distributions on the Notes is less
than the aggregate amount of Accrued Note Interest on the Notes, a draw on the Credit
Enhancement Instrument will be made; provided, however, that to the extent such shortfall is
a result of Prepayment Interest Shortfalls or Relief Act Shortfalls, whether related to the
current Collection Period or a prior Collection Period, the shortfall will not be covered by
the Credit Enhancement Instrument, and the shortfall will be allocated to the amount of
Accrued Note Interest on the Notes on a pro rata basis.
(e) 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, if
such Holder holds Notes of an aggregate initial Note Balance of at least $1,000,000, be paid
to each Holder of record on the preceding Record Date, by wire transfer to an account
specified in writing by such Holder reasonably satisfactory to the Indenture Trustee as of
the preceding Record Date or in all other cases or if no such instructions have been
delivered to the Indenture Trustee, by check or money order to such Noteholder mailed to
such Holder's address as it appears in the Note Register the amount required to be paid to
such Holder on such Payment Date pursuant to such Holder's Securities; provided, however,
that the Indenture Trustee shall not pay to such Holders any amount required to be withheld
from a payment to such Holder by the Code.
(f) Any payments to the Notes pursuant to clauses 3.05(a)(iii), (iv) and (vi) above plus
amounts drawn on the Credit Enhancement Instrument in respect of principal shall be
distributed to the Class A-1, Class A-2, Class A-3 and Class A-4 Notes, in that order, in
each case until the outstanding Note Balance thereof has been reduced to zero.
(g) The Note Balance of each Note shall be due and payable in full on the Final Insured
Payment Date as provided in the form of Note set forth in Exhibit A. All principal payments
on the Notes shall be made to the Noteholders entitled thereto in accordance with the
Percentage Interests represented by such Notes. Upon written notice to the Indenture
Trustee by the Issuer (or by the Master Servicer on behalf of the Issuer, pursuant to
Section 8.08(c) of the Servicing Agreement) of the Final Insured Payment Date for the Notes
or other final Payment Date, the Indenture Trustee shall notify the related Noteholders of
record of the Final Insured Payment Date or other final Payment Date, by mail or facsimile,
no later than five Business Days prior to the Final Insured Payment Date or other final
Payment Date and shall specify:
(i) that the Record Date otherwise applicable to such Payment Date is not applicable;
(ii) that payment of the principal amount and any interest due with respect to such Note
at the Final Insured Payment Date or other final Payment Date 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 such final payment; and
(iii) the amount of any such final payment, if known.
Section 3.06. Protection of Trust Estate. (a) The Issuer will from time to time execute
and deliver all such 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) maintain or preserve the lien and security interest (and the priority thereof) of
this Indenture or carry out more effectively the purposes hereof;
(ii) perfect, publish notice of or protect the validity of any Grant made or to be made by
this Indenture;
(iii) cause the Trust to enforce any of the Home Loans; and
(iv) preserve and defend title to the Trust Estate and the rights of the Indenture Trustee
and the Noteholders in such Trust Estate against the claims of all persons and
parties.
(b) Except as otherwise provided in this Indenture, the Indenture Trustee shall not
remove any portion of the Trust Estate that consists of money or is evidenced by an
instrument, certificate or other writing from the jurisdiction in which it was held at the
date of the most recent Opinion of Counsel delivered pursuant to Section 3.07 (or from the
jurisdiction in which it was held as described in the Opinion of Counsel delivered at the
Closing Date pursuant to Section 3.07(a), if no Opinion of Counsel has yet been delivered
pursuant to Section 3.07(b)) unless the Trustee shall have first received an Opinion of
Counsel to the effect that the lien and security interest created by this Indenture with
respect to such property will continue to be maintained after giving effect to such action
or actions. The Issuer hereby designates the Indenture Trustee its agent and attorney in
fact to execute any financing statement, continuation statement or other instrument required
to be executed pursuant to this Section 3.06.
Section 3.07. Opinions as to Trust Estate. (a) On the Closing Date, the Issuer shall
furnish to the Indenture Trustee and the Owner Trustee an Opinion of Counsel at the expense
of the Issuer either stating that, in the opinion of such counsel, such action has been
taken with respect to the recording and filing of this Indenture, any indentures
supplemental hereto, and any other requisite documents, and with respect to the execution
and filing of any financing statements and continuation statements, as are necessary to
perfect and make effective the lien and security interest in the Home Loans and reciting the
details of such action, or stating that, in the opinion of such counsel, no such action is
necessary to make such lien and security interest effective.
(b) On or before December 31st in each calendar year, beginning in 2006, the Issuer shall
furnish to the Indenture Trustee and the Credit Enhancer an Opinion of Counsel at the
expense of the Issuer either stating that, in the opinion of such counsel, such action has
been taken with respect to the recording, filing, rerecording and refiling of this
Indenture, any indentures supplemental hereto 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 in the Home Loans and reciting
the details of such action or stating that in the opinion of such counsel no such action is
necessary to maintain such lien and security interest. Such Opinion of Counsel shall also
describe 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 in the Home Loans until December 31
in the following calendar year.
Section 3.08. Performance of Obligations; Servicing Agreement. (a) The Issuer will
punctually perform and observe all of its obligations and agreements contained in this
Indenture, the Basic Documents and in the instruments and agreements included in the Trust
Estate.
(b) The Issuer may contract with other Persons 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.
(c) The Issuer will not take any action or permit any action to be taken by others which
would release any Person from any of such Person's covenants or obligations under any of the
documents relating to the Home Loans or under any instrument included in the Trust Estate,
or which would result in the amendment, hypothecation, subordination, termination or
discharge of, or impair the validity or effectiveness of, any of the documents relating to
the Home Loans or any such instrument, except such actions as the Master Servicer is
expressly permitted to take in the Servicing Agreement.
(d) The Issuer may retain an administrator and may enter into contracts with other
Persons for the performance of the Issuer's obligations hereunder, and performance of such
obligations by such Persons shall be deemed to be performance of such obligations by the
Issuer.
Section 3.09. Negative Covenants. So long as any Notes are Outstanding, the Issuer shall
not:
(i) except as expressly permitted by this Indenture, sell, transfer, exchange or
otherwise dispose of the Trust Estate, 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 Trust Estate;
(iii) (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 be expressly permitted
hereby, 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 Trust Estate or any part thereof or any interest
therein or the proceeds thereof or (B) permit the lien of this Indenture not to
constitute a valid first priority security interest in the Trust Estate; or
(iv) waive or impair, or fail to assert rights under the Home Loans, or impair or cause to
be impaired the Home Loans or the Issuer's interest in the Home Loans, the Home Loan
Purchase Agreement or in any Basic Document, if any such action would materially and
adversely affect the interests of the Noteholders.
Section 3.10. Annual Statement as to Compliance. The Issuer will deliver to the Indenture
Trustee and the Credit Enhancer, within 120 days after the end of each fiscal year of the
Issuer (commencing with the fiscal year 2006), 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 and the Trust Agreement 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 and the
provisions of the Trust Agreement throughout 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 3.11. Recording of Assignments. The Issuer shall enforce the obligation of the
Seller under the Home Loan Purchase Agreement to submit or cause to be submitted for
recording all Assignments of Mortgages within 60 days of receipt of recording information by
the Master Servicer.
Section 3.12. Representations and Warranties Concerning the Home Loans. The Indenture
Trustee, as pledgee of the Home Loans, has the benefit of the representations and warranties
made by the Seller in Section 3.1(a) and Section 3.1(b) of the Home Loan Purchase Agreement
concerning the Home Loans and the right to enforce the remedies against the Seller provided
in such Section 3.1(a) or Section 3.1(b) to the same extent as though such representations
and warranties were made directly to the Indenture Trustee.
Section 3.13. Assignee of Record of the Home Loans. The Issuer hereby directs and
authorizes the Indenture Trustee to hold record title to the Home Loans by being named as
payee in the endorsements of the Mortgage Notes and assignee in the Assignments of Mortgage
to be recorded under Section 2.1 of the Home Loan Purchase Agreement. Except as expressly
provided in the Home Loan Purchase Agreement or in the Servicing Agreement with respect to
any specific Home Loan, the Indenture Trustee shall not execute any endorsement or
assignment or otherwise release or transfer such record title to any of the Home Loans until
such time as the remaining Trust Estate may be released pursuant to Section 8.05(b). The
Indenture Trustee's holding of such record title shall in all respects be subject to its
fiduciary obligations to the Noteholders hereunder.
Section 3.14. Master Servicer as Agent and Bailee of the Indenture Trustee. Solely for
purposes of perfection under Section 9-305 of the Uniform Commercial Code or other similar
applicable law, rule or regulation of the state in which such property is held by the Master
Servicer, the Issuer and the Indenture Trustee hereby acknowledge that the Master Servicer
is acting as agent and bailee of the Indenture Trustee in holding amounts on deposit in the
Custodial Account pursuant to Section 3.02 of the Servicing Agreement that are allocable to
the Home Loans, as well as its agent and bailee in holding any Related Documents released to
the Master Servicer pursuant to Section 3.06(c) of the Servicing Agreement, and any other
items constituting a part of the Trust Estate which from time to time come into the
possession of the Master Servicer. It is intended that, by the Master Servicer's acceptance
of such agency pursuant to Section 3.02 of the Servicing Agreement, the Indenture Trustee,
as a pledgee of the Home Loans, will be deemed to have possession of such Related Documents,
such monies and such other items for purposes of Section 9-305 of the Uniform Commercial
Code of the state in which such property is held by the Master Servicer.
Section 3.15. Investment Company Act. The Issuer shall not become an "investment company"
or "controlled by" an investment company as such terms are defined in the Investment Company
Act of 1940, as amended (or any successor or amendatory statute), and the rules and
regulations thereunder (taking into account not only the general definition of the term
"investment company" but also any available exceptions to such general definition); provided,
however, that the Issuer shall be in compliance with this Section 3.15 if it shall have
obtained an order exempting it from regulation as an "investment company" so long as it is
in compliance with the conditions imposed in such order.
Section 3.16. Issuer May Consolidate, etc. (a) The Issuer shall not consolidate or merge
with or into any other Person, unless:
(i) the Person (if other than the Issuer) formed by or surviving such consolidation or
merger shall be a Person organized and existing under the laws of the United States
of America or any state or the District of Columbia and shall expressly assume, by an
indenture supplemental hereto, executed and delivered to the Indenture Trustee, in
form reasonably satisfactory to the Indenture Trustee, the due and punctual payment
of the principal of and interest on all Notes and to the Certificate Paying Agent, on
behalf of the Certificateholder and the performance or observance of every agreement
and covenant of this Indenture on the part of the Issuer to be performed or observed,
all as provided herein;
(ii) immediately after giving effect to such transaction, no Event of Default shall have
occurred and be continuing;
(iii) the Issuer receives consent of the Credit Enhancer (so long as no Credit Enhancer
Default exists) and the Rating Agencies shall have notified the Issuer (with a copy
to the Indenture Trustee) that such transaction shall not cause the rating of the
Notes, without regard to the Credit Enhancement Instrument, to be reduced, suspended
or withdrawn or to be considered by either Rating Agency to be below investment grade
without taking into account the Credit Enhancement Instrument;
(iv) the Issuer shall have received an Opinion of Counsel (and shall have delivered copies
thereof to the Indenture Trustee and the Credit Enhancer) to the effect that such
transaction will not have any material adverse tax consequence to the Issuer, any
Noteholder or any Certificateholder;
(v) any action that is necessary to maintain the lien and security interest created by
this Indenture shall have been taken; and
(vi) the Issuer shall have delivered to the Indenture Trustee an Officer's Certificate and
an Opinion of Counsel each stating that such consolidation or merger and such
supplemental indenture comply with this Article III and that all conditions precedent
herein provided for relating to such transaction have been complied with (including
any filing required by the Exchange Act).
(b) The Issuer shall not convey or transfer any of its properties or assets, including
those included in the Trust Estate, to any Person, unless:
(i) the Person that acquires by conveyance or transfer the properties and assets of the
Issuer the conveyance or transfer of which is hereby restricted shall (A) be a United
States citizen or a Person organized and existing under the laws of the United States
of America or any state, (B) expressly assume, by an indenture supplemental hereto,
executed and delivered to the Indenture Trustee, in form satisfactory to the
Indenture Trustee, the due and punctual payment of the principal of and interest on
all Notes and the performance or observance of every agreement and covenant of this
Indenture on the part of the Issuer to be performed or observed, all as provided
herein, (C) expressly agree by means of such supplemental indenture that all right,
title and interest so conveyed or transferred shall be subject and subordinate to the
rights of Holders of the Notes, (D) unless otherwise provided in such supplemental
indenture, expressly agree to indemnify, defend and hold harmless the Issuer against
and from any loss, liability or expense arising under or related to this Indenture
and the Notes and (E) expressly agree by means of such supplemental indenture that
such Person (or if a group of Persons, then one specified Person) shall make all
filings with the Commission (and any other appropriate Person) required by the
Exchange Act in connection with the Notes;
(ii) immediately after giving effect to such transaction, no Default or Event of Default
shall have occurred and be continuing;
(iii) the Issuer receives consent of the Credit Enhancer (so long as no Credit Enhancer
Default exists) and the Rating Agencies shall have notified the Issuer (with a copy
to the Indenture Trustee) that such transaction shall not cause the rating of the
Notes, without regard to the Credit Enhancement Instrument, to be reduced, suspended
or withdrawn;
(iv) the Issuer shall have received an Opinion of Counsel (and shall have delivered copies
thereof to the Indenture Trustee and the Credit Enhancer) to the effect that such
transaction will not have any material adverse tax consequence to the Issuer or any
Noteholder;
(v) any action that is necessary to maintain the lien and security interest created by
this Indenture shall have been taken; and
(vi) the Issuer shall have delivered to the Indenture Trustee an Officer's Certificate and
an Opinion of Counsel each stating that such conveyance or transfer and such
supplemental indenture comply with this Article III and that all conditions precedent
herein provided for relating to such transaction have been complied with (including
any filing required by the Exchange Act).
Section 3.17. Successor or Transferee. (a) Upon any consolidation or merger of the Issuer
in accordance with Section 3.16(a), the Person formed by or surviving such consolidation or
merger (if other than the Issuer) shall succeed to, and be substituted for, and may exercise
every right and power of, the Issuer under this Indenture with the same effect as if such
Person had been named as the Issuer herein.
(b) Upon a conveyance or transfer of all the assets and properties of the Issuer pursuant
to Section 3.16(b), the Issuer will be released from every covenant and agreement of this
Indenture to be observed or performed on the part of the Issuer with respect to the Notes
immediately upon the delivery of written notice to the Indenture Trustee of such conveyance
or transfer.
Section 3.18. No Other Business. The Issuer shall not engage in any business other than
financing, purchasing, owning and selling and managing the Home Loans and the issuance of
the Notes and the Certificate in the manner contemplated by this Indenture and the Basic
Documents and all activities incidental thereto.
Section 3.19. No Borrowing. The Issuer shall not issue, incur, assume, guarantee or
otherwise become liable, directly or indirectly, for any indebtedness except for the Notes.
Section 3.20. Guarantees, Loans, Advances and Other Liabilities. Except as contemplated
by this Indenture or the Basic Documents, the Issuer shall not make any loan or advance or
credit to, or guarantee (directly or indirectly or by an instrument having the effect of
assuring another's payment or performance on any obligation or capability of so doing or
otherwise), endorse or otherwise become contingently liable, directly or indirectly, in
connection with the obligations, stocks or dividends of, or own, purchase, repurchase or
acquire (or agree contingently to do so) any stock, obligations, assets or securities of, or
any other interest in, or make any capital contribution to, any other Person.
Section 3.21. Capital Expenditures. The Issuer shall not make any expenditure (by long
term or operating lease or otherwise) for capital assets (either realty or personalty).
Section 3.22. Owner Trustee Not Liable for the Certificate or Related Documents. The
recitals contained herein shall be taken as the statements of the Depositor, and the Owner
Trustee assumes no responsibility for the correctness thereof. The Owner Trustee makes no
representations as to the validity or sufficiency of this Indenture, of any Basic Document
or of the Certificate (other than the signatures of the Owner Trustee on the Certificate) or
the Notes, or of any Related Documents, or of MERS or the MERS(R)System. The Owner Trustee
shall at no time have any responsibility or liability with respect to the sufficiency of the
Trust Estate or its ability to generate the payments to be distributed to the
Certificateholder under the Trust Agreement or the Noteholders under this Indenture,
including, the compliance by the Depositor or the Seller with any warranty or representation
made under any Basic Document or in any related document or the accuracy of any such
warranty or representation, or any action of the Certificate Paying Agent, the Certificate
Registrar or the Indenture Trustee taken in the name of the Owner Trustee.
Section 3.23. Restricted Payments. The Issuer shall not, directly or indirectly, (i) pay
any dividend or make any payment (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, (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) payments to the Owner Trustee and the Certificateholder as
contemplated by, and to the extent funds are available for such purpose under the Trust
Agreement, and (y) payments to the Master Servicer pursuant to the terms of the Servicing
Agreement. The Issuer will not, directly or indirectly, make payments to or payments from
the Custodial Account except in accordance with this Indenture and the Basic Documents.
Section 3.24. Notice of Events of Default. The Issuer shall give the Indenture Trustee,
the Credit Enhancer and the Rating Agencies prompt written notice of each Event of Default
hereunder and any default under the Trust Agreement.
Section 3.25. 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.
Section 3.26. Statements to Noteholders. On each Payment Date, the Indenture Trustee and
the Certificate Registrar shall forward by mail or make available on its website initially
located at "xxx.xxxxxxxx.xxx/xxx" to the Credit Enhancer and each Noteholder and
Certificateholder, respectively, the statement delivered to it, on the Business Day
following the related Determination Date pursuant to Section 4.01 of the Servicing Agreement.
Section 3.27. Payments under the Credit Enhancement Instrument. (a) On or prior to 12:00
noon New York City time on the second Business Day before any Payment Date, including the
Final Insured Payment Date, the Indenture Trustee shall make a draw on the Credit
Enhancement Instrument in an amount, if any, equal to the Insured Payment. On or prior to
12:00 noon New York City time on the second Business Day before any Dissolution Payment
Date, the Indenture Trustee shall make a draw on the Credit Enhancement Instrument in an
amount, if any, equal to the Dissolution Draw.
(b) The Indenture Trustee shall submit, if an Insured Payment or Dissolution Draw is
specified in any Servicing Certificate prepared by the Master Servicer pursuant to Section
4.01 of the Servicing Agreement, the notice (in the form attached as Exhibit A to the Credit
Enhancement Instrument) in the amount of the Insured Payment or Dissolution Draw to the
Credit Enhancer no later than 12:00 noon New York City time, on the second Business Day
prior to the applicable Payment Date. Upon receipt of such Insured Payment in accordance
with the terms of the Credit Enhancement Instrument or Dissolution Draw, the Indenture
Trustee shall deposit such Insured Payment in the Payment Account for distribution to
Noteholders pursuant to Section 3.05 and shall distribute such Dissolution Draw in
accordance with Section 5.04.
Section 3.28. Reserved.
Section 3.29. Determination of Class A-1 Note Rate. On the second LIBOR Business Day
immediately preceding (i) the Closing Date in the case of the first Interest Accrual Period
and (ii) the first day of each succeeding Interest Accrual Period, the Indenture Trustee
shall determine LIBOR and the Note Rate for the Class A-1 Notes for such Interest Accrual
Period and shall inform the Issuer, the Master Servicer, the Credit Enhancer and the
Depositor at their respective facsimile numbers given to the Indenture Trustee in writing.
All determinations of LIBOR by the Indenture Trustee shall, in the absence of manifest
error, be conclusive for all purposes, and each holder of a Class A-1 Note, by accepting its
Class A-1 Note, agrees to be bound by such determination.
Section 3.30. Liquidation on Final Insured Payment Date. On the Final Insured Payment
Date, if the Notes are not paid in full on or prior to the Final Insured Payment Date, the
Indenture Trustee shall take full account of the assets and liabilities of the Trust, shall
liquidate the assets, in a commercially reasonable manner and on commercially reasonable
terms, as promptly as is consistent with obtaining the fair value thereof and in accordance
with Section 5.15, and shall apply and distribute the proceeds therefrom in the order of
priority described in Section 3.05(c).
Section 3.31. No Recourse. Upon the occurrence of an Event of Default under the Notes,
this Indenture or the other Basic Documents, Holders of the Notes shall have recourse only
to the Collateral and all proceeds thereof, as and to the extent provided herein, and no
recourse shall be had by such Holders against the Issuer or its other assets or properties.
Section 3.32. Additional UCC Representations and Warranties. The Issuer hereby represents
and warrants that:
(i) this Agreement creates a valid and continuing security interest (as defined in the
applicable UCC) in the Trust Estate in favor of the Indenture Trustee on behalf of
the Holders of the Notes, which security interest is prior to all other liens, and is
enforceable as such as against creditors of the Issuer.
(ii) the Issuer owns and has good and marketable title to the Trust Estate free and clear
of any lien, claim or encumbrance of any Person.
(iii) the Issuer will cause the filing of all appropriate financing statements in the
proper filing office in the appropriate jurisdictions under applicable law within 10
days of the Closing Date in order to perfect the security interest in the Trust
Estate granted to the Indenture Trustee on behalf of the Holders of the Notes.
(iv) other than the security interest granted to the Indenture Trustee on behalf of the
Holders of the Notes pursuant to the Basic Documents, the Issuer has not pledged,
assigned, sold, granted a security interest in, or otherwise conveyed any of the
Trust Estate. The Issuer is not aware of any judgment or tax lien filings against
it. The Issuer has not authorized the filing of and is not aware of any financing
statements against the Issuer that include a description of collateral covering the
Trust Estate other than any financing statement (i) relating to the security interest
granted to Indenture Trustee on behalf of the Holders of the Notes hereunder or (ii)
that has been terminated.
The foregoing representations may not be waived and shall survive the issuance of the
Notes.
ARTICLE IV
THE NOTES; SATISFACTION AND DISCHARGE OF INDENTURE
Section 4.01. The Notes. The Notes shall be registered in the name of a nominee
designated by the Depository. Beneficial Owners will hold interests in the Notes as set
forth in Section 4.06 herein. The minimum initial Note Balances with respect to the Notes
shall be $100,000 and integral multiples of $1 in excess thereof.
The Indenture Trustee may for all purposes (including the making of payments due on
the Notes) deal with the Depository as the authorized representative of the Beneficial
Owners with respect to the Notes for the purposes of exercising the rights of Holders of
Notes hereunder. Except as provided in the next succeeding paragraph of this Section 4.01,
the rights of Beneficial Owners with respect to the Notes shall be limited to those
established by law and agreements between such Beneficial Owners and the Depository and
Depository Participants. Except as provided in Section 4.08, Beneficial Owners shall not be
entitled to definitive certificates for the Notes as to which they are the Beneficial
Owners. Requests and directions from, and votes of, the Depository as Holder of the Notes
shall not be deemed inconsistent if they are made with respect to different Beneficial
Owners. The Indenture Trustee may establish a reasonable record date in connection with
solicitations of consents from or voting by Noteholders and give notice to the Depository of
such record date. Without the consent of the Issuer and the Indenture Trustee, no Note may
be transferred by the Depository except to a successor Depository that agrees to hold such
Note for the account of the Beneficial Owners.
In the event the Depository Trust Company resigns or is removed as Depository, the
Indenture Trustee with the approval of the Issuer may appoint a successor Depository. If no
successor Depository has been appointed within 30 days of the effective date of the
Depository's resignation or removal, each Beneficial Owner shall be entitled to certificates
representing the Notes it beneficially owns in the manner prescribed in Section 4.08.
The Notes shall, on original issue, be executed on behalf of the Issuer by the Owner
Trustee, not in its individual capacity but solely as Owner Trustee, authenticated by the
Note Registrar and delivered by the Indenture Trustee to or upon the order of the Issuer.
Section 4.02. Registration of and Limitations on Transfer and Exchange of Notes;
Appointment of Certificate Registrar. The Issuer shall cause to be kept at the Indenture
Trustee's Corporate Trust Office a Note Register in which, subject to such reasonable
regulations as it may prescribe, the Note Registrar shall provide for the registration of
Notes and of transfers and exchanges of Notes as herein provided.
Subject to the restrictions and limitations set forth below, upon surrender for
registration of transfer of any Note at the Corporate Trust Office, the Issuer shall execute
and the Note Registrar shall authenticate and deliver, in the name of the designated
transferee or transferees, one or more new Notes in authorized initial Note Balances
evidencing the same aggregate Percentage Interests.
Subject to the foregoing, at the option of the Noteholders, Notes may be exchanged
for other Notes of like tenor, in authorized initial Note Balances evidencing the same
aggregate Percentage Interests upon surrender of the Notes to be exchanged at the Corporate
Trust Office of the Note Registrar. Whenever any Notes are so surrendered for exchange, the
Issuer shall execute and the Note Registrar shall authenticate and deliver the Notes which
the Noteholder making the exchange is entitled to receive. Each Note presented or
surrendered for registration of transfer or exchange shall (if so required by the Note
Registrar) be duly endorsed by, or be accompanied by a written instrument of transfer in
form reasonably satisfactory to the Note Registrar duly executed by, the Holder thereof or
his attorney duly authorized in writing with such signature guaranteed by a commercial bank
or trust company located or having a correspondent located in the city of New York. Notes
delivered upon any such transfer or exchange will evidence the same obligations, and will be
entitled to the same rights and privileges, as the Notes surrendered.
No service charge shall be imposed for any registration of transfer or exchange of
Notes, but the Note Registrar shall require payment of a sum sufficient to cover any tax or
governmental charge that may be imposed in connection with any registration of transfer or
exchange of Notes.
All Notes surrendered for registration of transfer and exchange shall be cancelled by
the Note Registrar and delivered to the Indenture Trustee for subsequent destruction without
liability on the part of either.
The Issuer hereby appoints the Indenture Trustee as Certificate Registrar to keep at
its Corporate Trust Office a Certificate Register pursuant to Section 3.09 of the Trust
Agreement in which, subject to such reasonable regulations as it may prescribe, the
Certificate Registrar shall provide for the registration of the Certificate and of transfers
and exchanges thereof pursuant to Section 3.05 of the Trust Agreement. The Indenture
Trustee hereby accepts such appointment.
Each purchaser and transferee of a Note, by its acceptance of the Note, shall be
deemed to have represented and warranted that either (i) it is not acquiring the Note with
the assets of an "employee benefit plan" as defined in Section 3(3) of ERISA, which is
subject to the provisions of Title I of ERISA, a "plan" described in Section 4975(e)(1) of
the Code, an entity whose underlying assets include "plan assets" by reason of an employee
benefit plan's or other plan's investment in such entity or any other plan that is subject
to a law that is similar to Title I of ERISA or Section 4975 of the Code or (ii) the
acquisition and holding of the Note will not give rise to a non-exempt prohibited
transaction under Section 406 of ERISA, Section 4975 of the Code or any similar applicable
law.
Section 4.03. 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 Indenture Trustee such security or indemnity as may be required by it to hold the Issuer
and the Indenture Trustee 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, and provided that the requirements of Section 8-405 of the UCC are met, the
Issuer shall execute, and upon its 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,
instead of issuing a replacement Note, the Issuer may pay such destroyed, lost or stolen
Note when so due or payable 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 and the
Indenture Trustee shall be entitled to recover such replacement Note (or such payment) from
the Person to whom it was delivered or any Person taking such replacement Note from such
Person to whom such replacement Note was delivered or any assignee of such Person, except a
bona fide purchaser, and 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 4.03, 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 4.03 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 4.03 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.
Section 4.04. Persons Deemed Owners. Prior to due presentment for registration of
transfer of any Note, the Issuer, the Credit Enhancer, the Indenture Trustee and any agent
of the Issuer or the Indenture Trustee may treat the Person in whose name any Note is
registered (as of the day of determination) as the owner of such Note 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 Credit
Enhancer, the Indenture Trustee or any agent of the Issuer or the Indenture Trustee shall be
affected by notice to the contrary.
Section 4.05. 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 be promptly cancelled by the Indenture
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 be promptly 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 4.05, 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 Request that they be destroyed or returned to it;
provided, however, that such Issuer Request is timely and the Notes have not been previously
disposed of by the Indenture Trustee.
Section 4.06. Book Entry Notes. Each Class of Notes shall initially be issued as one or
more Notes held by the Book Entry Custodian or, if appointed to hold such Notes as provided
below, the Depository Trust Company, the initial Depository, and registered in the name of
its nominee Cede & Co. Except as provided below, registration of such Notes may not be
transferred by the Indenture Trustee except to another Depository that agrees to hold such
Notes for the respective Beneficial Owners. The Indenture Trustee is hereby initially
appointed as the Book Entry Custodian and xxxxxx agrees to act as such in accordance
herewith and in accordance with the agreement that it has with the Depository authorizing it
to act as such. The Book Entry Custodian may, and, if it is no longer qualified to act as
such, the Book Entry Custodian shall, appoint, by a written instrument delivered to the
Depositor, the Master Servicer and, if the Indenture Trustee is not the Book Entry
Custodian, the Indenture Trustee, any other transfer agent (including the Depository or any
successor Depository) to act as Book Entry Custodian under such conditions as the
predecessor Book Entry Custodian and the Depository or any successor Depository may
prescribe, provided that the predecessor Book Entry Custodian shall not be relieved of any
of its duties or responsibilities by reason of any new appointment, except if the Depository
is the successor to the Book Entry Custodian. If the Indenture Trustee resigns or is
removed in accordance with the terms hereof, the successor trustee or, if it so elects, the
Depository shall immediately succeed to its predecessor's duties as Book Entry Custodian.
The Depositor shall have the right to inspect, and to obtain copies of, any Notes held as
Book Entry Notes by the Book Entry Custodian. No Beneficial Owner will receive a Definitive
Note representing such Beneficial Owner's interest in such Note, except as provided in
Section 4.08. Unless and until definitive, fully registered Notes (the "Definitive Notes")
have been issued to Beneficial Owners pursuant to Section 4.08:
(i) the provisions of this Section 4.06 shall be in full force and effect;
(ii) the Note Registrar and the Indenture Trustee shall be entitled to deal with the
Depository for all purposes of this Indenture (including the payment of principal of
and interest on the Notes and the giving of instructions or directions hereunder) as
the sole holder of the Notes, and shall have no obligation to the Owners of Notes;
(iii) to the extent that the provisions of this Section 4.06 conflict with any other
provisions of this Indenture, the provisions of this Section 4.06 shall control;
(iv) the rights of Beneficial Owners shall be exercised only through the Depository and
shall be limited to those established by law and agreements between such Owners of
Notes and the Depository and/or the Depository Participants. Unless and until
Definitive Notes are issued pursuant to Section 4.08, the initial Depository will
make book-entry transfers among the Depository Participants and receive and transmit
payments of principal of and interest on the Notes to such Depository Participants;
and
(v) whenever this Indenture requires or permits actions to be taken based upon
instructions or directions of Holders of Notes evidencing a specified percentage of
the aggregate Note Balance of the Notes, the Depository shall be deemed to represent
such percentage only to the extent that it has received instructions to such effect
from Beneficial Owners and/or Depository Participants owning or representing,
respectively, such required percentage of the beneficial interest in the Notes and
has delivered such instructions to the Indenture Trustee.
Section 4.07. Notices to Depository. Whenever a notice or other communication to the Note
Holders is required under this Indenture, unless and until Definitive Notes shall have been
issued to Beneficial Owners pursuant to Section 4.08, the Indenture Trustee shall give all
such notices and communications specified herein to be given to Holders of the Notes to the
Depository, and shall have no obligation to the Beneficial Owners.
Section 4.08. Definitive Notes. If (i) the Indenture Trustee determines that the
Depository is no longer willing or able to properly discharge its responsibilities with
respect to the Notes and the Indenture Trustee is unable to locate a qualified successor,
(ii) the Indenture Trustee elects to terminate the book-entry system through the Depository
or (iii) after the occurrence of an Event of Default, Owners of Notes representing
beneficial interests aggregating at least a majority of the aggregate Note Balance of the
Notes advise the Depository in writing that the continuation of a book-entry system through
the Depository is no longer in the best interests of the Beneficial Owners, then the
Depository shall notify all Beneficial Owners and the Indenture Trustee of the occurrence of
any such event and of the availability of Definitive Notes to Beneficial Owners requesting
the same. Upon surrender to the Indenture Trustee of the typewritten Notes representing the
Book Entry Notes by the Book Entry Custodian or the Depository, as applicable, accompanied
by registration instructions, the Issuer shall execute and the Indenture Trustee shall
authenticate the Definitive Notes in accordance with the instructions of the Depository.
None of the Issuer, the Note Registrar or the Indenture Trustee shall be liable for any
delay in delivery of such instructions and may conclusively rely on, and shall be protected
in relying on, such instructions. Upon the issuance of Definitive Notes, the Indenture
Trustee shall recognize the Holders of the Definitive Notes as Noteholders.
Section 4.09. Tax Treatment. The Issuer has entered into this Indenture, and the Notes
will be 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.
The Issuer, by entering into this Indenture, and each Noteholder, by its acceptance of its
Note (and each Beneficial Owner by its acceptance of an interest in the applicable Book
Entry Note), agree to treat the Notes for federal, state and local income, single business
and franchise tax purposes as indebtedness of the Issuer.
Section 4.10. 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, 3.06, 3.09, 3.16, 3.17, 3.18, 3.19 and 3.20, (v) the rights,
obligations and immunities of the Indenture Trustee hereunder (including the rights of the
Indenture Trustee under Section 6.07 and the obligations of the Indenture Trustee under
Section 4.11) 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 acknowledging satisfaction and discharge of this Indenture with respect to the
Notes, when
(A) either
(1) the 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 4.03 and (ii) Notes for whose payment 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) have been
delivered to the Indenture Trustee for cancellation; or
(2) the Notes not theretofore delivered to the Indenture Trustee for cancellation
a. have become due and payable,
b. will become due and payable at the Final Insured Payment Date within one year, or
c. have been declared immediately due and payable pursuant to Section 5.02.
and the Issuer, in the case of a. or b. above, has irrevocably deposited or caused
to be irrevocably 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 then
outstanding not theretofore delivered to the Indenture Trustee for cancellation when
due on the Final Insured Payment Date;
(B) the Issuer has paid or caused to be paid all other sums payable hereunder and under
the Insurance Agreement by the Issuer; and
(C) the Issuer has delivered to the Indenture Trustee and the Credit Enhancer an
Officer's Certificate and an Opinion of Counsel, each meeting the applicable requirements of
Section 10.01 and each stating that all conditions precedent herein provided for relating to
the satisfaction and discharge of this Indenture have been complied with and, if the Opinion
of Counsel relates to a deposit made in connection with Section 4.10(A)(2)b. above, such
opinion shall further be to the effect that such deposit will not have any material adverse
tax consequences to the Issuer, any Noteholders or any Certificateholder.
Section 4.11. Application of Trust Money. All monies deposited with the Indenture Trustee
pursuant to Section 4.10 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 or Certificate Paying Agent, as the Indenture Trustee may determine, to the
Holders of Securities, of all sums due and to become due thereon for principal and interest;
but such monies need not be segregated from other funds except to the extent required herein
or required by law.
Section 4.12. Subrogation and Cooperation. The Issuer and the Indenture Trustee
acknowledge that (i) to the extent the Credit Enhancer makes payments under the Credit
Enhancement Instrument on account of principal of or interest on the Home Loans, the Credit
Enhancer will be fully subrogated to the rights of the Noteholders to receive such principal
and interest from the Home Loans, and (ii) the Credit Enhancer shall be paid such principal
and interest but only from the sources and in the manner provided herein and in the
Insurance Agreement for the payment of such principal and interest.
The Indenture Trustee shall cooperate in all respects with any reasonable request by
the Credit Enhancer for action to preserve or enforce the Credit Enhancer's rights or
interest under this Indenture or the Insurance Agreement, consistent with this Indenture and
without limiting the rights of the Noteholders as otherwise set forth in the Indenture,
including, without limitation, upon the occurrence and continuance of a default under the
Insurance Agreement, a request to take any one or more of the following actions:
(i) institute Proceedings for the collection of all amounts then payable on the Notes, or
under this Indenture in respect to the Notes and all amounts payable under the
Insurance Agreement and to enforce any judgment obtained and collect from the Issuer
monies adjudged due;
(ii) sell the Trust Estate or any portion thereof or rights or interest therein, at one or
more public or private Sales (as defined in Section 5.15 hereof) called and conducted
in any manner permitted by law;
(iii) file or record all assignments that have not previously been recorded;
(iv) institute Proceedings from time to time for the complete or partial foreclosure of
this Indenture; and
(v) exercise any remedies of a secured party under the Uniform Commercial Code and take
any other appropriate action to protect and enforce the rights and remedies of the
Credit Enhancer hereunder.
Following the payment in full of the Notes, the Credit Enhancer shall continue to
have all rights and privileges provided to it under this Section and in all other provisions
of this Indenture, until all amounts owing to the Credit Enhancer have been paid in full.
Section 4.13. Repayment of Monies Held by Paying Agent. In connection with the
satisfaction and discharge of this Indenture with respect to the Notes, all monies then held
by any Person 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 3.05 and thereupon such Paying Agent shall be
released from all further liability with respect to such monies.
Section 4.14. Temporary Notes. Pending the preparation of any Definitive Notes, the
Issuer may execute and upon its written direction, the Indenture Trustee may authenticate
and make available for delivery, temporary Notes that are printed, lithographed,
typewritten, photocopied or otherwise produced, in any denomination, substantially of the
tenor of the Definitive Notes in lieu of which they are issued and with such appropriate
insertions, omissions, substitutions and other variations as the officers executing such
Notes may determine, as evidenced by their execution of such Notes.
If temporary Notes are issued, the Issuer will cause Definitive Notes to be prepared
without unreasonable delay. After the preparation of the Definitive Notes, the temporary
Notes shall be exchangeable for Definitive Notes upon surrender of the temporary Notes at
the office or agency of the Indenture Trustee, without charge to the Holder. Upon surrender
for cancellation of any one or more temporary Notes, the Issuer shall execute and the
Indenture Trustee shall authenticate and make available for delivery, in exchange therefor,
Definitive Notes of authorized denominations and of like tenor and aggregate principal
amount. Until so exchanged, such temporary Notes shall in all respects be entitled to the
same benefits under this Indenture as Definitive Notes.
ARTICLE V
DEFAULT AND REMEDIES
Section 5.01. Events of Default. The Issuer shall deliver to the Indenture Trustee and
the Credit Enhancer within five calendar days after learning of the occurrence of any event
which with the giving of notice and the lapse of time would become an Event of Default under
clause (iii) of the definition of "Event of Default" written notice in the form of an
Officer's Certificate of its status and what action the Issuer 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 or the
Holders of Notes representing not less than a majority of the aggregate Note Balance of all
Notes with the written consent of the Credit Enhancer (so long as no Credit Enhancer Default
exists), or the Credit Enhancer (so long as no Credit Enhancer Default exists) may declare
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 with respect to an
Event of Default has been made and before a judgment or decree for payment of the money due
has been obtained by the Indenture Trustee as hereinafter in this Article V provided, the
Holders of Notes representing a majority of the aggregate Note Balance of all Notes, by
written notice to the Issuer and the Indenture Trustee with the written consent of the
Credit Enhancer (so long as no Credit Enhancer Default exists), or the Credit Enhancer (so
long as no Credit Enhancer Default exists) may in writing waive the related Event of Default
and rescind and annul such declaration and its consequences if:
(i) the Issuer has paid or deposited with the Indenture Trustee a sum sufficient to pay:
(A) all sums due and payable to the Credit Enhancer; and
(B) all payments of principal of and interest on the Notes and all
other amounts that would then be due hereunder or upon the Notes if the Event
of Default giving rise to such acceleration had not occurred; and
(C) 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
(ii) 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
Section 5.12.
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) Subject to Section 3.31, the Issuer covenants that if default in the payment of (i) any
interest on any Note when the same becomes due and payable, and such default continues for a
period of five days, or (ii) the principal of or any installment of the principal of any
Note when the same becomes due and payable, the Issuer shall, upon demand of the Indenture
Trustee, pay to it, for the benefit of the Holders of Notes, the whole amount then due and
payable on the Notes for principal and interest, with interest upon the overdue principal,
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, in its own name and as trustee of an express trust, subject to the
provisions of Section 10.17 hereof may 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 the Notes and collect in the
manner provided by law out of the property of the Issuer or other obligor upon the Notes,
wherever situated, the monies adjudged or decreed to be payable.
(c) If an Event of Default occurs and is continuing, the Indenture Trustee subject to the
provisions of Section 10.17 hereof may, as more particularly provided in Section 5.04, in
its discretion, 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 Trust Estate,
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, shall be entitled and empowered, by intervention in such
Proceedings or otherwise:
(i) to file and prove a claim or claims for the whole amount of principal and 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 and each
predecessor Indenture Trustee, and their respective 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, willful misconduct 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 Holders
of Notes in any election of a trustee, a standby trustee or Person performing similar
functions in any such Proceedings;
(iii) to collect and receive any monies 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 of 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 Holders of
Notes 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, willful misconduct 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 and attorneys, shall be for the ratable
benefit of the Holders of the Notes.
(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 Holders
of the Notes, 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 subject to the provisions of Section 10.17 hereof may with
the written consent of the Credit Enhancer (so long as no Credit Enhancer Default exists),
or shall at the written direction of the Credit Enhancer (so long as no Credit Enhancer
Default exists), do one or more of the following (subject to Section 5.05):
(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, and all amounts payable under
the Insurance Agreement enforce any judgment obtained, and collect from the Issuer
and any other obligor upon such Notes monies adjudged due;
(ii) institute Proceedings from time to time for the complete or partial foreclosure of
this Indenture with respect to the Trust Estate;
(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 and
the Holders of the Notes;
(iv) sell the Trust Estate or any portion thereof or rights or interest therein, 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
Trust Estate following an Event of Default, unless (A) the Indenture Trustee obtains
the consent of the Credit Enhancer, which consent shall not be unreasonably withheld,
or if a Credit Enhancer Default has occurred and is continuing, the consent of the
Holders of 100% of the aggregate Note Balance of the Notes, (B) the proceeds of such
Sale distributable to Holders are sufficient to discharge in full all amounts then
due and unpaid upon the Notes for principal and interest and to reimburse the Credit
Enhancer for any amounts drawn under the Credit Enhancement Instrument and any other
amounts due the Credit Enhancer under the Insurance Agreement or (C) the Indenture
Trustee determines that the Home Loans 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 the Credit Enhancer (so long as no Credit Enhancer Default
exists), which consent will not be unreasonably withheld; provided further that the
Indenture Trustee shall not sell or otherwise liquidate the Trust Estate if the
proceeds of such sale or liquidation will not be sufficient to discharge in full all
amounts then due and unpaid upon the Notes for principal and interest and to
reimburse the Credit Enhancer for any amounts drawn under the Credit Enhancement
Instrument and any other amounts due the Credit Enhancer under the Insurance
Agreement unless the Indenture Trustee obtains the consent of the Holders of 66 2/3%
of the aggregate Note Balance of the Notes. In determining such sufficiency or
insufficiency with respect to clauses (B) and (C), 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 Trust Estate for such purpose. Following an Event
of Liquidation, on the related Dissolution Payment Date, the Indenture Trustee shall
make a draw on the Credit Enhancement Instrument in an amount equal to the
Dissolution Draw pursuant to Section 3.27 and shall distribute such amount as set
forth in Section 5.04(b) below. Notwithstanding the foregoing, so long as a
Servicing Default has not occurred, any Sale of the Trust Estate shall be made
subject to the continued servicing of the Home Loans by the Master Servicer as
provided in the Servicing Agreement.
(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: to the Indenture Trustee for all amounts due under Section 6.07 herein;
SECOND: to the Holders of the Notes for amounts due and unpaid on the Notes for
interest, according to the order and priority set forth in Section 3.05(a)(ii) from
amounts available in the Trust Estate for such Noteholders;
THIRD: on a pro rata basis, to Holders of the Notes for amounts due and unpaid on
the Notes for principal, from amounts available in the Trust Estate for such
Noteholders, according to the amounts due and payable on the Notes for principal,
until the related Note Balances of the Notes are reduced to zero;
FOURTH: [reserved];
FIFTH: to the payment of all amounts due and owing to the Credit Enhancer under the
Insurance Agreement;
SIXTH: to the Certificate Paying Agent for amounts due under Article VIII of the
Trust Agreement; and
SEVENTH: to the payment of the remainder, if any, to the Issuer or any other person
legally entitled thereto.
The Indenture Trustee may fix a record date and payment date for any payment to
Noteholders pursuant to this Section 5.04. At least 15 days before such record date, the
Indenture Trustee shall mail to each Noteholder a notice that states the record date, the
payment date and the amount to be paid.
Section 5.05. Optional Preservation of the Trust Estate. If the Notes have been declared
to be due and payable under Section 5.02 following an Event of Default and such declaration
and its consequences have not been rescinded and annulled, the Indenture Trustee may, but
need not (but shall at the written direction of the Credit Enhancer, so long as no Credit
Enhancer Default exists) elect to take and maintain possession of the Trust Estate. 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 other obligations of the
Issuer including payment to the Credit Enhancer and the Indenture Trustee shall take such
desire into account when determining whether or not to take and maintain possession of the
Trust Estate. In determining whether to take and maintain possession of the Trust Estate,
the Indenture Trustee may, but need not, obtain (at the expense of the Issuer) 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 Trust Estate for
such purpose.
Section 5.06. Limitation of Suits. No Holder of any Note 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 and subject
to the provisions of Section 10.17 hereof:
(i) such Holder has previously given written notice to the Indenture Trustee of a
continuing Event of Default;
(ii) the Holders of not less than 25% of the aggregate Note Balance of the 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;
(iii) such Holder or Holders have offered to the Indenture Trustee reasonable indemnity
against the costs, expenses and liabilities to be incurred in complying with such
request;
(iv) the Indenture Trustee for 60 days after its receipt of such notice, request and offer
of indemnity has failed to institute such Proceedings; and
(v) no direction inconsistent with such written request has been given to the Indenture
Trustee during such 60 day period by the Holders of a majority of the aggregate Note
Balance of the Notes or by the Credit Enhancer.
It is understood and intended that no one or more Holders of Notes 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 Holders of Notes or to obtain or to
seek to obtain priority or preference over any other Holders 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 Holders of Notes, each representing less than a
majority of the aggregate Note Balance of the Notes, the Indenture Trustee in its sole
discretion may determine what action, if any, shall be taken, notwithstanding any other
provisions of this Indenture.
Section 5.07. Rights of Noteholders to Receive Principal and Interest. Notwithstanding
any other provisions in this Indenture, but subject to Section 3.31, the Holder of any Note
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 respective due dates thereof
expressed in such Note or in this Indenture and to institute suit for the enforcement of any
such payment, and such right shall not be impaired without the consent of such Holder.
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, the Indenture Trustee and the Noteholders shall, subject to any determination in
such Proceeding, be restored severally and respectively to their respective 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, the Credit Enhancer 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, the Credit Enhancer or any Holder of any Note to exercise any right or remedy
accruing upon any Event of Default shall impair any such right or remedy or constitute a
waiver of any such 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 the Credit Enhancer or the Noteholders. The Holders of a
majority of the aggregate Note Balance of Notes with the consent of the Credit Enhancer (so
long as no Credit Enhancer Default exists), or the Credit Enhancer (so long as no Credit
Enhancer Default exists) 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 that:
(i) such direction shall not be in conflict with any rule of law or with this Indenture;
(ii) subject to the express terms of Section 5.04, any direction to the Indenture Trustee
to sell or liquidate the Trust Estate shall be by Holders of Notes representing not
less than 100% of the aggregate Note Balance of Notes with the consent of the Credit
Enhancer (so long as no Credit Enhancer Default exists), or the Credit Enhancer (so
long as no Credit Enhancer Default exists);
(iii) if the conditions set forth in Section 5.05 have been satisfied and the Indenture
Trustee elects to retain the Trust Estate pursuant to such Section, then any
direction to the Indenture Trustee by Holders of Notes representing less than 100% of
the aggregate Note Balance of Notes to sell or liquidate the Trust Estate shall be of
no force and effect; and
(iv) the Indenture Trustee may take any other action deemed proper by the Indenture
Trustee that is not inconsistent with such direction.
Notwithstanding the rights of Noteholders set forth in this Section, subject to Section
6.01, 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 unless the Indenture Trustee has received satisfactory indemnity from the
Credit Enhancer or the Noteholders.
Section 5.12. Waiver of Past Defaults. Prior to the declaration of the acceleration of
the maturity of the Notes as provided in Section 5.02, the Holders of Notes of not less than
a majority of the aggregate Note Balance of the Notes with the consent of the Credit
Enhancer (so long as no Credit Enhancer Default exists), or the Credit Enhancer (so long as
no Credit Enhancer Default exists) may waive any past Event of Default and its consequences
except an Event of Default (a) with respect to payment of principal of or interest on any of
the Notes or (b) in respect of a covenant or provision hereof which cannot be modified or
amended without the consent of the Holder of each Note. In the case of any such waiver, the
Issuer, the Indenture Trustee and the Holders of the Notes shall be restored to their former
positions and rights hereunder, respectively; but no such waiver shall extend to any
subsequent or other Event of Default or impair any right consequent thereto.
Upon any such waiver, 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 Event of Default or impair any right consequent
thereto.
Section 5.13. Undertaking for Costs. All parties to this Indenture agree, and each Holder
of any Note by such Xxxxxx'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 more than 10% of
the aggregate Note Balance of the Notes 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.
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
shall 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.
Section 5.15. Sale of Trust Estate. (a) The power to effect any sale, liquidation or
other disposition (a "Sale") of any portion of the Trust Estate pursuant to Section 5.04 is
expressly subject to the provisions of Section 5.05 and this Section 5.15. The power to
effect any such Sale shall not be exhausted by any one or more Sales as to any portion of
the Trust Estate remaining unsold, but shall continue unimpaired until the entire Trust
Estate shall have been sold or all amounts payable on the Notes and under this Indenture and
under the Insurance Agreement shall have been paid. The Indenture Trustee may from time to
time postpone any public Sale by public announcement made at the time and place of such
Sale. The Indenture Trustee hereby expressly waives its right to any amount fixed by law as
compensation for any Sale.
(b) The Indenture Trustee shall not in any private Sale sell the Trust Estate, or any
portion thereof, unless:
(1) the Holders of all Notes and the Credit Enhancer (so long as no Credit Enhancer
Default exists) consent to, or direct the Indenture Trustee to make, such Sale, or
(2) the proceeds of such Sale would not be less than the entire amount which would be
payable to the Noteholders under the Notes, the Certificateholder under the
Certificate and the Credit Enhancer in respect of amounts drawn under the Credit
Enhancement Instrument and any other amounts due the Indenture Trustee in connection
with expenses incurred by reason of such sale and any other amounts due the Credit
Enhancer under the Insurance Agreement, in full payment thereof in accordance with
Section 5.02, on the Payment Date next succeeding the date of such Sale, or
(3) the Indenture Trustee determines, in its sole discretion, that the conditions for
retention of the Trust Estate set forth in Section 5.05 cannot be satisfied (in
making any such determination, the Indenture Trustee may rely upon an opinion of an
Independent investment banking firm obtained and delivered as provided in Section
5.05), and the Credit Enhancer consents (so long as no Credit Enhancer Default
exists) to such Sale, which consent will not be unreasonably withheld and the Holders
representing at least 66-2/3% of the aggregate Note Balance of the Notes consent to
such Sale.
The purchase by the Indenture Trustee of all or any portion of the Trust Estate at a private
Sale shall not be deemed a Sale or other disposition thereof for purposes of this Section
5.15(b).
(c) Unless the Holders and the Credit Enhancer (so long as no Credit Enhancer Default
exists) have otherwise consented or directed the Indenture Trustee, at any public Sale of
all or any portion of the Trust Estate at which a minimum bid equal to or greater than the
amount described in paragraph (2) of subsection (b) of this Section 5.15 has not been
established by the Indenture Trustee and no Person bids an amount equal to or greater than
such amount, the Indenture Trustee shall bid an amount at least $1.00 more than the highest
other bid.
(d) In connection with a Sale of all or any portion of the Trust Estate:
(1) any Holder or Holders of Notes may bid for and with the consent of the Credit
Enhancer (so long as no Credit Enhancer Default exists) purchase the property offered
for sale, and upon compliance with the terms of sale may hold, retain and possess and
dispose of such property, without further accountability, and may, in paying the
purchase money therefor, deliver any Notes or claims for interest thereon in lieu of
cash up to the amount which shall, upon payment of the net proceeds of such sale, be
payable thereon, and such Notes, in case the amounts so payable thereon shall be less
than the amount due thereon, shall be returned to the Holders thereof after being
appropriately stamped to show such partial payment;
(2) the Indenture Trustee may bid for and acquire the property offered for Sale in
connection with any Sale thereof, and, subject to any requirements of, and to the
extent permitted by, applicable law in connection therewith, may purchase all or any
portion of the Trust Estate in a private sale, and, in lieu of paying cash therefor,
may make settlement for the purchase price by crediting the gross Sale price against
the sum of (A) the amount which would be distributable to the Holders of the Notes
and the Holder of the Certificate and amounts owing to the Credit Enhancer as a
result of such Sale in accordance with Section 5.04(b) on the Payment Date next
succeeding the date of such Sale and (B) the expenses of the Sale and of any
Proceedings in connection therewith which are reimbursable to it, without being
required to produce the Notes in order to complete any such Sale or in order for the
net Sale price to be credited against such Notes, and any property so acquired by the
Indenture Trustee shall be held and dealt with by it in accordance with the
provisions of this Indenture;
(3) the Indenture Trustee shall execute and deliver an appropriate instrument of
conveyance transferring its interest in any portion of the Trust Estate in connection
with a Sale thereof;
(4) the Indenture Trustee is hereby irrevocably appointed the agent and attorney-in-fact
of the Issuer to transfer and convey its interest in any portion of the Trust Estate
in connection with a Sale thereof, and to take all action necessary to effect such
Sale; and
(5) no purchaser or transferee at such a Sale 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 monies.
Section 5.16. 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 Trust
Estate 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).
Section 5.17. Performance and Enforcement of Certain Obligations. (a) Promptly following
a written request from the Credit Enhancer or the Indenture Trustee with the written consent
of the Credit Enhancer to do so (so long as no Credit Enhancer Default exists), the Issuer,
in its capacity as holder of the Home Loans, shall, with the written consent of the Credit
Enhancer (so long as no Credit Enhancer Default exists), take all such lawful action as the
Indenture Trustee may request to cause the Issuer to compel or secure the performance and
observance by the Seller and the Master Servicer, as applicable, of each of their
obligations to the Issuer under or in connection with the Home Loan Purchase Agreement and
the Servicing Agreement, and to exercise any and all rights, remedies, powers and privileges
lawfully available to the Issuer under or in connection with the Home Loan Purchase
Agreement and the Servicing Agreement to the extent and in the manner directed by the
Indenture Trustee, as pledgee of the Home Loans, including the transmission of notices of
default on the part of the Seller or the Master Servicer thereunder and the institution of
legal or administrative actions or proceedings to compel or secure performance by the Seller
or the Master Servicer of each of their obligations under the Home Loan Purchase Agreement
and the Servicing Agreement.
(b) If an Event of Default has occurred and is continuing, the Indenture Trustee, as
pledgee of the Home Loans, subject to the rights of the Credit Enhancer under the Servicing
Agreement may, and at the direction (which direction shall be in writing or by telephone
(confirmed in writing promptly thereafter)) of the Credit Enhancer (or if a Credit Enhancer
Default has occurred and is continuing, Holders of 66-2/3% of the aggregate Note Balance of
the Notes) shall, exercise all rights, remedies, powers, privileges and claims of the Issuer
against the Seller or the Master Servicer under or in connection with the Home Loan Purchase
Agreement and the Servicing Agreement, including the right or power to take any action to
compel or secure performance or observance by the Seller or the Master 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 Home Loan Purchase
Agreement and the Servicing Agreement, as the case may be, and any right of the Issuer to
take such action shall not be suspended. In connection therewith, as determined by the
Indenture Trustee, the Issuer shall take all actions necessary to effect the transfer of the
Home Loans to the Indenture Trustee.
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:
(i) the Indenture Trustee undertakes 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; however, the Indenture Trustee
shall examine the certificates and opinions to determine whether or not they conform
to the requirements of this Indenture.
(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 (A)
pursuant to Section 5.11 or (B) from the Credit Enhancer, which it is entitled to
give under any of the Basic Documents.
(d) The Indenture Trustee shall not be liable for interest on any money received by it
except as the Indenture Trustee may agree in writing with the Issuer.
(e) Money held in trust by the Indenture Trustee need not be segregated from other funds
except to the extent required by law or the terms of this Indenture or the Trust Agreement.
(f) 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.
(g) 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 and to the provisions of the TIA.
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, and the Indenture Trustee shall not be responsible for any misconduct or negligence
on the part of, or for the supervision of, any such agent, attorney, custodian or nominee
appointed with due care by it hereunder.
(d) The Indenture Trustee shall not be liable for 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 the Indenture Trustee's conduct does not constitute willful misconduct,
negligence or bad faith.
(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 Note Registrar, co registrar or co paying agent may do the same with
like rights. However, the Indenture Trustee must comply with Sections 6.11 and 6.12.
Section 6.04. Indenture Trustee's Disclaimer. The Indenture Trustee shall not be
(i) responsible for and makes no representation as to the validity or adequacy of this
Indenture or the Notes, (ii) accountable for the Issuer's use of the proceeds from the Notes
or (iii) 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. Notice of Event of Default. If an Event of Default occurs and is continuing
and if it is known to a Responsible Officer of the Indenture Trustee, the Indenture Trustee
shall give notice thereof to the Credit Enhancer. The Indenture Trustee shall mail to each
Noteholder notice of the Event of Default within 90 days after it occurs. Except in the
case of an Event of Default in payment of principal of or interest on any Note, the
Indenture Trustee may withhold the notice if and so long as a committee of its Responsible
Officers in good faith determines that withholding the notice is in the interests of
Noteholders.
Section 6.06. Reports by Indenture Trustee to Holders. The Indenture Trustee shall
deliver to each Noteholder such information as may be required to enable such holder to
prepare its federal and state income tax returns. In addition, upon the Issuer's written
request, the Indenture Trustee shall promptly furnish information reasonably requested by
the Issuer that is reasonably available to the Indenture Trustee to enable the Issuer to
perform its federal and state income tax reporting obligations.
Section 6.07. Compensation and Indemnity. The Indenture Trustee shall be compensated and
indemnified by the Master Servicer in accordance with Section 6.06 of the Servicing
Agreement. The Indenture Trustee's compensation shall not be limited by any law on
compensation of a trustee of an express trust.
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 and
the Credit Enhancer. The Holders of a majority of the aggregate Note Balance of the Notes
or the Credit Enhancer (so long as no Credit Enhancer Default exists) may remove the
Indenture Trustee by so notifying the Indenture Trustee and the Credit Enhancer and may
appoint a successor Indenture Trustee. The Issuer shall remove the Indenture Trustee if:
(i) the Indenture Trustee fails to comply with Section 6.11;
(ii) the Indenture Trustee is adjudged a bankrupt or insolvent;
(iii) a receiver or other public officer takes charge of the Indenture Trustee or its
property; or
(iv) 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 the
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 with the consent of the Credit Enhancer (so long as no Credit Enhancer
Default exists), which consent will not be unreasonably withheld. In addition, the
Indenture Trustee will resign to avoid being directly or indirectly controlled by the Issuer.
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 Holders of a majority of the aggregate Note Balance of the Notes 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, 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,
the Issuer's obligations under Section 6.07 shall continue for the benefit of the retiring
Indenture Trustee.
Section 6.09. Successor Indenture Trustee by Xxxxxx. 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 transferee corporation without any further act shall be the
successor Indenture Trustee; provided, that such corporation or banking association shall be
otherwise qualified and eligible under Section 6.11. The Indenture Trustee shall provide
the Rating Agencies written notice of any such transaction occurring after the Closing Date.
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 Trust Estate 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
Estate, and to vest in such Person or Persons, in such capacity and for the benefit of the
Noteholders, such title to the Trust Estate, or any part thereof, and, subject to the other
provisions of this Section, 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 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 Trust Estate or any portion thereof in any such
jurisdiction) shall be exercised and performed singly by such separate trustee or
co-trustee, but solely at the direction of the Indenture Trustee;
(ii) no trustee hereunder shall be personally liable by reason of any act or omission of
any other trustee hereunder; and
(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, either jointly with the
Indenture Trustee or separately, as may be provided therein, 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; Disqualification. The Indenture Trustee shall at all times
satisfy the requirements of TIAss.310(a). The Indenture Trustee shall have a combined
capital and surplus of at least $50,000,000 as set forth in its most recent published annual
report of condition and it or its parent shall have a long term debt rating of A or better
by Xxxxx'x. The Indenture Trustee shall comply with TIAss.310(b), including the optional
provision permitted by the second sentence of TIAss.310(b)(9); provided, however, that there
shall be excluded from the operation of TIAss.310(b)(1) any indenture or indentures under
which other securities of the Issuer are outstanding if the requirements for such exclusion
set forth in TIAss.310(b)(1) are met.
Within 90 days after ascertaining the occurrence of an Event of Default which shall
not have been cured or waived, unless authorized by the Securities and Exchange Commission,
the Indenture Trustee shall resign with respect to one or more Classes of Notes in
accordance with Section 6.08 of this Indenture, and the Issuer shall appoint a successor
Indenture Trustee for such Classes. In the event the Indenture Trustee fails to comply with
the terms of the preceding sentence, the Indenture Trustee shall comply with clause (ii) of
TIAss.310(b).
In the case of the appointment hereunder of a successor Indenture Trustee with
respect to any Class of Notes pursuant to this Section 6.11, the Issuer, the retiring
Indenture Trustee and the successor Indenture Trustee with respect to such Class of Notes
shall execute and deliver an indenture supplemental hereto wherein each successor Indenture
Trustee shall accept such appointment and which (i) shall contain such provisions as shall
be necessary or desirable to transfer and confirm to, and to vest in, the successor
Indenture Trustee all the rights, powers, trusts and duties of the retiring Indenture
Trustee with respect to the Notes of the Class to which the appointment of such successor
Indenture Trustee relates, (ii) if the retiring Indenture Trustee is not retiring with
respect to all Classes of Notes, shall contain such provisions as shall be deemed necessary
or desirable to confirm that all the rights, powers, trusts and duties of the retiring
Indenture Trustee with respect to the Notes of each Class as to which the retiring Indenture
Trustee is not retiring shall continue to be vested in the Indenture Trustee, and
(iii) shall add to or change any of the provisions of this Indenture as shall be necessary to
provide for or facilitate the administration of the trusts hereunder by more than one
Indenture Trustee, it being understood that nothing herein or in such supplemental indenture
shall constitute such Indenture Trustees co-trustees of the same trust and that each such
Indenture Trustee shall be trustee of a trust or trusts hereunder separate and apart from
any trust or trusts hereunder administered by any other such Indenture Trustee; and upon the
removal of the retiring Indenture Trustee shall become effective to the extent provided
therein.
Section 6.12. Preferential Collection of Claims Against Issuer. The Indenture Trustee
shall comply with TIAss.311(a), excluding any creditor relationship listed in TIAss.311(b).
An Indenture Trustee who has resigned or been removed shall be subject to TIAss.311(a) to
the extent indicated.
Section 6.13. Representations and Warranties. The Indenture Trustee hereby represents
that:
(i) The Indenture Trustee is a banking association duly organized, validly existing and
in good standing under the laws of the United States with power and authority to own
its properties and to conduct its business as such properties are currently owned and
such business is presently conducted.
(ii) The Indenture Trustee has the power and authority to execute and deliver this
Indenture and to carry out its terms; and the execution, delivery and performance of
this Indenture have been duly authorized by the Indenture Trustee by all necessary
corporate action.
(iii) The consummation of the transactions contemplated by this Indenture and the
fulfillment of the terms hereof do not conflict with, result in any breach of any of
the terms and provisions of, or constitute (with or without notice or lapse of time)
a default under, the articles of organization or bylaws of the Indenture Trustee or
any agreement or other instrument to which the Indenture Trustee is a party or by
which it is bound.
(iv) To the Indenture Trustee's best knowledge, there are no proceedings or investigations
pending or threatened before any court, regulatory body, administrative agency or
other governmental instrumentality having jurisdiction over the Indenture Trustee or
its properties: (A) asserting the invalidity of this Indenture (B) seeking to
prevent the consummation of any of the transactions contemplated by this Indenture or
(C) seeking any determination or ruling that might materially and adversely affect
the performance by the Indenture Trustee of its obligations under, or the validity or
enforceability of, this Indenture.
(v) The Indenture Trustee does not have notice of any adverse claim (as such terms are
used in Delaware UCC Section 8-302) with respect to the Home Loans.
Section 6.14. Directions to Indenture Trustee. The Indenture Trustee is hereby directed:
(a) to accept the pledge of the Home Loans and hold the assets of the Trust in trust for
the Noteholders and the Credit Enhancer;
(b) to authenticate and deliver the Notes substantially in the form prescribed by
Exhibits A-1 and A-2 in accordance with the terms of this Indenture;
(c) on the Closing Date, to enter into the Credit Enhancement Instrument for the benefit
of the Noteholders with the Credit Enhancer; and
(d) to take all other actions as shall be required to be taken by the terms of this
Indenture.
Section 6.15. Indenture Trustee May Own Securities. The Indenture Trustee, in its
individual or any other capacity may become the owner or pledgee of Securities with the same
rights it would have if it were not Indenture Trustee.
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 each Record Date, a list, in such form as the Indenture Trustee may reasonably
require, of the names and addresses of the Holders of Notes as of such Record Date and, (b)
at such other times as the Indenture Trustee and the Credit Enhancer 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; Communications to Noteholders. (a) The
Indenture Trustee shall preserve, in as current a form as is reasonably practicable, the
names and addresses of the Holders of Notes contained in the most recent list furnished to
the Indenture Trustee as provided in Section 7.01 and the names and addresses of Holders of
Notes 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.
(b) Noteholders may communicate pursuant to TIAss.312(b) with other Noteholders with
respect to their rights under this Indenture or under the Notes.
(c) The Issuer, the Indenture Trustee and the Note Registrar shall have the protection of
TIAss.312(c).
Section 7.03. Reports by Issuer. (a) The Issuer shall:
(i) file with the Indenture Trustee, within 15 days after the Issuer is required to file
the same with the Commission, copies of the annual reports and the information,
documents and other reports (or copies of such portions of any of the foregoing as
the Commission may from time to time by rules and regulations prescribe) that the
Issuer may be required to file with the Commission pursuant to Section 13 or 15(d) of
the Exchange Act;
(ii) file with the Indenture Trustee, and the Commission in accordance with rules and
regulations prescribed from time to time by the Commission such additional
information, documents and reports with respect to compliance by the Issuer with the
conditions and covenants of this Indenture as may be required from time to time by
such rules and regulations; and
(iii) supply to the Indenture Trustee (and the Indenture Trustee shall transmit by mail to
all Noteholders described in TIAss.313(c)) such summaries of any information,
documents and reports required to be filed by the Issuer pursuant to clauses (i) and
(ii) of this Section 7.03(a) and by rules and regulations prescribed from time to
time by the Commission.
(b) Unless the Issuer otherwise determines, the fiscal year of the Issuer shall end on
December 31 of each year.
Section 7.04. Reports by Indenture Trustee. If required by TIAss.313(a), within 60 days
after each January 1 beginning with January 1, 2007, the Indenture Trustee shall mail to
each Noteholder as required by TIAss.313(c) and to the Credit Enhancer a brief report dated
as of such date that complies with TIAss.313(a). The Indenture Trustee also shall comply
with TIAss.313(b). A copy of each report at the time of its mailing to Noteholders shall be
filed by the Indenture Trustee with the Commission and each stock exchange, if any, on which
the Notes are listed. The Issuer shall notify the Indenture Trustee if and when the Notes
are listed on any stock exchange.
Section 7.05. Exchange Act Reporting. In connection with the preparation and filing of
periodic reports by the Master Servicer pursuant to Section 4.04 of the Servicing Agreement,
the Indenture Trustee shall timely provide to the Master Servicer (I) a list of Holders as
shown on the Note Register or Certificate Register as of the end of each calendar year, (II)
copies of all pleadings, other legal process and any other documents relating to any claims,
charges or complaints involving the Indenture Trustee, as indenture trustee hereunder, or
the Trust Estate that are received by the Indenture Trustee, (III) notice of all matters
that, to the actual knowledge of a Responsible Officer of the Indenture Trustee, have been
submitted to a vote of the Holders, other than those matters that have been submitted to a
vote of the Holders at the request of the Depositor or the Master Servicer, and (IV) notice
of any failure of the Indenture Trustee to make any payment to the Holders as required
pursuant to this Indenture. Neither the Master Servicer nor the Indenture Trustee shall
have any liability with respect to the Master Servicer's failure to properly prepare or file
such periodic reports resulting from or relating to the Master Servicer's inability or
failure to obtain any information not resulting from the Master Servicer's own negligence or
willful misconduct.
ARTICLE VIII
ACCOUNTS, DISBURSEMENTS AND RELEASES
Section 8.01. Collection of Money. 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 fiscal agent or other 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 Trust Estate, 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.
Section 8.02. Trust Accounts. (a) On or prior to the Closing Date, the Issuer shall cause
the Indenture Trustee to establish and maintain, in the name of the Indenture Trustee, for
the benefit of the Noteholders and the Certificate Paying Agent, on behalf of the
Certificateholder and the Credit Enhancer, the Payment Account as provided in Section 3.01
of this Indenture.
(b) All monies deposited from time to time in the Payment Account pursuant to the
Servicing Agreement and all deposits therein pursuant to this Indenture are for the benefit
of the Noteholders and the Certificate Paying Agent, on behalf of the Certificateholder and
all investments made with such monies including all income or other gain from such
investments are for the benefit of the Master Servicer as provided by the Servicing
Agreement.
On each Payment Date, the Indenture Trustee shall distribute all amounts on deposit
in the Payment Account to Noteholders in respect of the Notes and in its capacity as
Certificate Paying Agent to the Certificateholder in the order of priority set forth in
Section 3.05 (except as otherwise provided in Section 5.04(b)).
The Master Servicer shall direct the Indenture Trustee in writing to invest any funds
in the Payment Account in Permitted Investments maturing no later than the Business Day
preceding each Payment Date and shall not be sold or disposed of prior to the maturity.
Section 8.03. Officer's Certificate. The Indenture Trustee shall receive at least seven
days notice when requested by the Issuer to take any action pursuant to Section 8.05(a),
accompanied by copies of any instruments to be executed, and the Indenture Trustee shall
also require, as a condition to such action, an Officer's Certificate, 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.
Section 8.04. Termination Upon Payment to Noteholders. This Indenture and the respective
obligations and responsibilities of the Issuer and the Indenture Trustee created hereby
shall terminate upon the payment to the Noteholders, the Certificate Paying Agent (on behalf
of the Certificateholder) and the Indenture Trustee of all amounts required to be paid
pursuant to Article III; provided, however, that in no event shall the trust created hereby
continue beyond the expiration of 21 years from the death of the survivor of the descendants
of Xxxxxx X. Xxxxxxx, the late ambassador of the United States to the Court of St. Xxxxx,
living on the date hereof.
Section 8.05. Release of Trust Estate. (a) Subject to the payment of its fees and
expenses, the Indenture Trustee may, and when required by the provisions of this Indenture
shall, execute instruments to release property from the lien of this Indenture, or convey
the Indenture Trustee's interest in the same, 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 Article VIII hereunder 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 monies.
(b) The Indenture Trustee shall, at such time as (i) there are no Notes Outstanding, (ii)
all sums due the Indenture Trustee pursuant to this Indenture and other Basic Documents have
been paid and (iii) all sums due the Credit Enhancer have been paid, release any remaining
portion of the Trust Estate that secured the Notes from the lien of this Indenture.
(c) The Indenture Trustee shall release property from the lien of this Indenture pursuant
to this Section 8.05 only upon receipt of a request from the Issuer accompanied by an
Officers' Certificate and a letter from the Credit Enhancer, stating that the Credit
Enhancer has no objection to such request from the Issuer.
(d) The Indenture Trustee shall, at the request of the Issuer or the Depositor, surrender
the Credit Enhancement Instrument to the Credit Enhancer for cancellation, upon final
payment on the Notes.
Section 8.06. Surrender of Notes Upon Final Payment. By acceptance of any Note, the
Holder thereof agrees to surrender such Note to the Indenture Trustee promptly, prior to
such Noteholder's receipt of the final payment thereon.
ARTICLE IX
SUPPLEMENTAL INDENTURES
Section 9.01. Supplemental Indentures Without Consent of Noteholders. (a) Without the
consent of the Holders of any Notes but with prior notice to the Rating Agencies and the
written consent of the Credit Enhancer (which consent shall not be unreasonably withheld),
unless a Credit Enhancer Default has occurred and is continuing, the Issuer and the
Indenture Trustee, when authorized by an Issuer Request, at any time and from time to time,
may enter into one or more indentures supplemental hereto (which shall conform to the
provisions of the Trust Indenture Act as in force at the date of the execution thereof), 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 Holders of the Notes or
the Credit Enhancer, 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 any error, or to correct or supplement any
provision herein or in any supplemental indenture that may be inconsistent with any
other provision herein, in any supplemental indenture or in the Prospectus Supplement;
(vi) to make any other provisions with respect to matters or questions arising under this
Indenture or in any supplemental indenture; provided, that such action shall not
materially and adversely affect the interests of the Holders of the Notes or the
Credit Enhancer;
(vii) 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; or
(viii) to modify, eliminate or add to the provisions of this Indenture to such extent as
shall be necessary to effect the qualification of this Indenture under the TIA or
under any similar federal statute hereafter enacted and to add to this Indenture such
other provisions as may be expressly required by the TIA; provided, however, that no
such indenture supplements shall be entered into unless the Indenture Trustee shall
have received an Opinion of Counsel that entering into such indenture supplement will
not have any material adverse tax consequences to the Noteholders. 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.
(b) The Issuer and the Indenture Trustee, when authorized by an Issuer Request, may, also
without the consent of any of the Holders of the Notes, but with prior notice to the Rating
Agencies and with the consent of the Credit Enhancer (so long as no Credit Enhancer Default
exists), 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 the Holders of the Notes under this
Indenture; provided, however, that such action shall not, as evidenced by an Opinion of
Counsel, (i) adversely affect in any material respect the interests of any Noteholder or the
Credit Enhancer or (ii) cause the Issuer to be subject to an entity level tax.
(c) The Issuer and the Indenture Trustee shall, as directed by the Holders of
Certificates which represent not less than 100% of the Certificate Percentage Interests
thereof, enter into an indenture or indentures supplemental hereto for the purpose of
providing for the issuance of one or more additional classes of Notes entitled to payments
derived solely from all or a portion of the payments to which the Certificate issued on the
Closing Date pursuant to the Trust Agreement are entitled; provided, however, that such
action shall not, as evidenced by an Opinion of Counsel, (i) adversely affect in any
material respect the interests of any Noteholder or the Credit Enhancer or (ii) cause the
Issuer to be subject to an entity level tax. Each such class of Notes shall be a non
recourse obligation of the Issuer and shall be entitled to interest and principal in such
amounts, and to such security for the repayment thereof, as shall be specified in such
amendment or amendments. Promptly after the execution by the Issuer and the Indenture
Trustee of any amendments pursuant to this Section or the creation of a new indenture and
the issuance of the related class or classes of Notes, the Issuer shall require the
Indenture Trustee to give notice to the Holders of the Notes and the Rating Agencies setting
forth in general terms the substance of the provisions of such amendment. Any failure of
the Indenture Trustee to provide such notice as is required under this paragraph, or any
defect therein, shall not, however, in any way impair or affect the validity of such
amendment or any class of Notes issued pursuant thereto. Unless the Credit Enhancer agrees
in writing, (i) any classes of Notes issued pursuant to a supplemental indenture shall not
be entitled to the insurance provided by the Credit Enhancement Instrument and (ii) the
Holders of any such classes of Notes shall be entitled only to such distributions or a
portion of such distributions as the Holders would have received as Holder of Certificate.
Section 9.02. Supplemental Indentures With Consent of Noteholders. The Issuer and the
Indenture Trustee, when authorized by an Issuer Request, also may, with prior notice to the
Rating Agencies and with the consent of the Holders of not less than a majority of the
aggregate Note Balance of the Notes affected thereby and the Credit Enhancer (so long as no
Credit Enhancer Default exists), by Act (as defined in Section 10.03 hereof) of such Holders
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 the Holders of the Notes under this Indenture; provided, however, that no such
supplemental indenture shall, without the consent of the Holder of each Note affected
thereby:
(i) change the date of payment of any installment of principal of or interest on any
Note, or reduce the principal amount thereof or the interest rate thereon, change the
provisions of this Indenture relating to the application of collections on, or the
proceeds of the Sale of, the Trust Estate 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, to the payment of any such amount
due on the Notes on or after the respective due dates thereof;
(ii) reduce the percentage of the related Note Balance of any Class of Notes, 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;
(iii) modify or alter the provisions of the proviso to the definition of the term
"Outstanding" or modify or alter the exception in the definition of the term "Holder";
(iv) reduce the percentage of the aggregate Note Balance of the Notes required to direct
the Indenture Trustee to direct the Issuer to sell or liquidate the Trust Estate
pursuant to Section 5.04;
(v) 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 Note affected thereby;
(vi) 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
(vii) 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 Trust Estate or, except as otherwise
permitted or contemplated herein, terminate the lien of this Indenture on any
property at any time subject hereto or deprive the Holder of any Note of the security
provided by the lien of this Indenture; and provided, further, that such action shall
not, as evidenced by an Opinion of Counsel, cause the Issuer to be subject to an
entity level tax.
and provided, further, that no such indenture supplements shall be entered into unless the
Indenture Trustee shall have received an Opinion of Counsel that entering into such
indenture supplement will not adversely affect in any material respect the interests of the
Certificateholder or shall have received the express written consent of the
Certificateholder to the indenture supplement.
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 the Holders of all Notes, whether theretofore or thereafter authenticated and delivered
hereunder. The Indenture Trustee shall not be liable for any such determination made in
good faith.
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.
Promptly after the execution by the Issuer and the Indenture Trustee of any
supplemental indenture pursuant to this Section 9.02, the Indenture Trustee shall mail to
the Holders of the Notes and the Custodian to which such amendment or supplemental indenture
relates a notice setting forth in general terms the substance of such supplemental
indenture. Any failure of the Indenture Trustee to mail such notice, or any defect therein,
shall not, however, in any way impair or affect the validity of any such supplemental
indenture.
So long as there does not exist a failure by the Credit Enhancer to make a required
payment under the Credit Enhancement Instrument, the Credit Enhancer shall have the right to
exercise all rights of the Holders of the Notes under this Indenture without any consent of
such Holders, and such Holders may exercise such rights only with the prior written consent
of the Credit Enhancer, except as provided herein.
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, 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 and conforms to the requirements of
the Trust Indenture Act. 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 Indenture. 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. Conformity with Trust Indenture Act. Every amendment of this Indenture and
every supplemental indenture executed pursuant to this Article IX shall conform to the
requirements of the Trust Indenture Act as then in effect so long as this Indenture shall
then be qualified under the Trust Indenture Act.
Section 9.06. 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
MISCELLANEOUS
Section 10.01. Compliance Certificates and Opinions, etc. (a) Upon any application or
request by the Issuer to the Indenture Trustee to take any action under any provision of
this Indenture, the Issuer shall furnish to the Indenture Trustee and to the Credit Enhancer
(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, except that, in the case of any such application or request as
to which the furnishing of such documents is specifically required by any provision of this
Indenture, no additional certificate or opinion need be furnished. 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;
(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;
(4) a statement as to whether, in the opinion of each such signatory, such condition or
covenant has been complied with; and
(5) if the signer of such certificate or Opinion is required to be Independent, the
statement required by the definition of the term "Independent".
(b) (i) Prior to the deposit of any Collateral or other property or securities with
the Indenture Trustee that is to be made the basis for the release of any property or
securities subject to the lien of this Indenture, the Issuer shall, in addition to any
obligation imposed in Section 10.01(a) or elsewhere in this Indenture, furnish to the
Indenture Trustee an Officer's Certificate certifying or stating the opinion of each person
signing such certificate as to the fair value (within 90 days of such deposit) to the Issuer
of the Collateral or other property or securities to be so deposited.
(ii) Whenever the Issuer is required to furnish to the Indenture Trustee an Officer's
Certificate certifying or stating the opinion of any signer thereof as to the matters
described in clause (i) above, the Issuer shall also deliver to the Indenture Trustee an
Independent Certificate as to the same matters, if the fair value to the Issuer of the
securities to be so deposited and of all other such securities made the basis of any such
withdrawal or release since the commencement of the then current fiscal year of the Issuer,
as set forth in the certificates delivered pursuant to clause (i) above and this clause
(ii), is 10% or more of the aggregate Note Balance of the Notes, but such a certificate need
not be furnished with respect to any securities so deposited, if the fair value thereof to
the Issuer as set forth in the related Officer's Certificate is less than $25,000 or less
than one percent of the aggregate Note Balance of the Notes.
(iii) Whenever any property or securities are to be released from the lien of this
Indenture, the Issuer shall also furnish to the Indenture Trustee an Officer's Certificate
certifying or stating the opinion of each person signing such certificate as to the fair
value (within 90 days of such release) of the property or securities proposed to be released
and stating that in the opinion of such person the proposed release will not impair the
security under this Indenture in contravention of the provisions hereof.
(iv) Whenever the Issuer is required to furnish to the Indenture Trustee an Officer's
Certificate certifying or stating the opinion of any signer thereof as to the matters
described in clause (iii) above, the Issuer shall also furnish to the Indenture Trustee an
Independent Certificate as to the same matters if the fair value of the property or
securities and of all other property, other than property as contemplated by clause (v)
below or securities released from the lien of this Indenture since the commencement of the
then current calendar year, as set forth in the certificates required by clause (iii) above
and this clause (iv), equals 10% or more of the aggregate Note Balance of the Notes, but
such certificate need not be furnished in the case of any release of property or securities
if the fair value thereof as set forth in the related Officer's Certificate is less than
$25,000 or less than one percent of the then aggregate Note Balance of the Notes.
(v) Notwithstanding any provision of this Indenture, the Issuer may, without compliance
with the requirements of the other provisions of this Section 10.01, (A) collect, sell or
otherwise dispose of the Home Loans as and to the extent permitted or required by the Basic
Documents or (B) make cash payments out of the Payment Account as and to the extent
permitted or required by the Basic Documents, so long as the Issuer shall deliver to the
Indenture Trustee every six months, commencing six months after the closing date, an
Officer's Certificate of the Issuer stating that all the dispositions of Collateral described
in clauses (A) or (B) above that occurred during the preceding six calendar months were in
the ordinary course of the Issuer's business and that the proceeds thereof were applied in
accordance with the Basic Documents.
Section 10.02. 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
his 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 Seller or
the Issuer, stating that the information with respect to such factual matters is in the
possession of the Seller or the Issuer, 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.
Section 10.03. 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) conclusive in favor of the Indenture Trustee
and the Issuer, if made in the manner provided in this Section 10.03.
(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 Registrar.
(d) Any request, demand, authorization, direction, notice, consent, waiver or other
action by the Holder of any Notes 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 10.04. Notices, etc., to Indenture Trustee, Issuer, Credit Enhancer and Rating
Agencies. 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 the Corporate Trust Office. The Indenture Trustee shall
promptly transmit any notice received by it from the Noteholders to the Issuer,
(ii) the Issuer by the Indenture Trustee or by any Noteholder shall be sufficient for
every purpose hereunder if in writing and mailed first class, postage prepaid to the
Issuer addressed to: Home Loan Trust 2006-HI2, in care of Wilmington Trust Company,
or at any other address previously furnished in writing to the Indenture Trustee by
the Issuer. The Issuer shall promptly transmit any notice received by it from the
Noteholders to the Indenture Trustee, or
(iii) the Credit Enhancer by the Issuer, the Indenture Trustee or by any Noteholders shall
be sufficient for every purpose hereunder to in writing and mailed, first class
postage pre-paid, or personally delivered or telecopied to: Financial Guaranty
Insurance Company, 000 Xxxx Xxxxxx, Xxx Xxxx, XX 00000, Attention: Structured Finance
Surveillance (Home Loan Trust 2006-HI2), telecopier number (000) 000-0000,
confirmation number (000) 000-0000. The Credit Enhancer shall promptly transmit any
notice received by it from the Issuer, the Indenture Trustee or the Noteholders to
the Issuer or Indenture Trustee, as the case may be.
Notices required to be given to the Rating Agencies by the Issuer, the Indenture
Trustee or the Owner Trustee shall be in writing, personally delivered or mailed by
certified mail, return receipt requested, to (i) in the case of Moody's, at the following
address: Xxxxx'x Investors Service, Inc., ABS Monitoring Department, 00 Xxxxxx Xxxxxx, Xxx
Xxxx, Xxx Xxxx 00000 and (ii) in the case of Standard & Poor's, at the following address:
Standard & Poor's, a Division of the McGraw Hill Companies, Inc., 00 Xxxxx Xxxxxx, 00xx
Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention of Asset Backed Surveillance Department; or as to
each of the foregoing, at such other address as shall be designated by written notice to the
other parties.
Section 10.05. Notices to Noteholders; Waiver. Where this Indenture provides for notice to
Noteholders of any event, such notice shall be sufficiently given (unless otherwise herein
expressly provided) if in writing and mailed, first class, postage prepaid to each
Noteholder affected by such event, at such Person's 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 been duly given regardless of whether such notice is in fact actually
received.
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.
Where this Indenture provides for notice to the Rating Agencies, failure to give such
notice shall not affect any other rights or obligations created hereunder, and shall not
under any circumstance constitute an Event of Default.
Section 10.06. Alternate Payment and Notice Provisions. Notwithstanding any provision of
this Indenture or any of the Notes to the contrary, the Issuer may enter into any agreement
with any Holder of a Note providing for a method of payment, or notice by the Indenture
Trustee to such Holder, that is different from the methods provided for in this Indenture
for such payments or notices. The Issuer shall furnish to the Indenture Trustee a copy of
each such agreement and the Indenture Trustee shall cause payments to be made and notices to
be given in accordance with such agreements.
Section 10.07. Conflict with Trust Indenture Act. If any provision hereof limits,
qualifies or conflicts with another provision hereof that is required to be included in this
Indenture by any of the provisions of the Trust Indenture Act, such required provision shall
control. The provisions of TIAss.ss.310 through 317 that impose duties on any Person
(including the provisions automatically deemed included herein unless expressly excluded by
this Indenture) are a part of and govern this Indenture, whether or not physically contained
herein.
Section 10.08. Effect of Headings. The Article and Section headings herein are for
convenience only and shall not affect the construction hereof.
Section 10.09. 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 10.10. 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 10.11. 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, the Credit Enhancer and any other party secured hereunder,
and any other Person with an ownership interest in any part of the Trust Estate, any benefit
or any legal or equitable right, remedy or claim under this Indenture. The Credit Enhancer
is a third-party beneficiary of this Indenture.
Section 10.12. 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.
Section 10.13. GOVERNING LAW. THIS INDENTURE SHALL BE CONSTRUED IN ACCORDANCE WITH THE
LAWS OF THE STATE OF NEW YORK, WITHOUT REFERENCE TO ITS CONFLICTS OF LAW PROVISIONS (OTHER
THAN SECTIONS 5-1401 AND 5-1402 OF THE NEW YORK GENERAL OBLIGATIONS LAW), AND THE
OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE
WITH SUCH LAWS.
Section 10.14. 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 10.15. 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) 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 10.16. Issuer 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 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 or agent 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 (it being understood that the Indenture Trustee and the
Owner Trustee have no such obligations in their respective individual capacities) 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. 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 10.17. No Petition. The Indenture Trustee, by entering into this Indenture, and
each Noteholder, by its acceptance of 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.
Section 10.18. Inspection. The Issuer agrees that, on reasonable prior notice, it shall
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 be reasonably requested. 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.
IN WITNESS WHEREOF, the Issuer and the Indenture Trustee have caused their names to
be signed hereto by their respective officers thereunto duly authorized, all as of the day
and year first above written.
HOME LOAN TRUST 2006-HI2
as Issuer
By: WILMINGTON TRUST COMPANY not in its
individual capacity but solely as Owner
Trustee
By: /s/ Xxxxx X. Xxxxxx
Name: Xxxxx X. Xxxxxx
Title: Assistant Vice President
JPMORGAN CHASE BANK, NATIONAL ASSOCIATION,
as Indenture Trustee
By: /s/ Xxxxxx Xxxxxx
Name: Xxxxxx Xxxxxx
Title: Assistant Vice President
JPMORGAN CHASE BANK, NATIONAL ASSOCIATION
hereby accepts the appointment as Paying Agent
pursuant to Section 3.03 hereof and as
Note Registrar pursuant to Section 4.02 hereof.
By: /s/ Xxxxx Xxxxxxx
Name: Xxxxx Xxxxxxx
Title: Vice President
STATE OF TEXAS )
) ss.:
COUNTY OF XXXXXX )
On this 25th day of May, 2006, before me personally appeared Xxxxxx Xxxxxx, to me
known, who being by me duly sworn, did depose and say, that he/she resides at Houston,
Texas, that he/she is the Assistant Vice President of the Indenture Trustee, one of the
corporations described in and which executed the above instrument; and that he/she signed
his/her name thereto by like order.
/s/ Xxxxxxx X. Xxxxxx
Notary Public
STATE OF TEXAS_ )
_______ ) ss.:
COUNTY OF______HARRIS )
On this 25th day of May, 2006, before me the undersigned, Notary Public of said
State, personally appeared Xxxxx Xxxxxxx, personally known to me to be a duly authorized
officer of JPMorgan Chase Bank, National Association that executed the within instrument and
personally known to me to be the person who executed the within instrument on behalf of
JPMorgan Chase Bank, National Association therein named, and acknowledged to me such
JPMorgan Chase Bank, National Association executed the within instrument pursuant to its
by-laws.
/s/ Xxxxxxx X. Xxxxxx
Notary Public
STATE OF DELAWARE )
_______ ) ss.:
COUNTY OF NEW CASTLE )
On this 25th day of May, 2006, before me personally appeared Xxxxx X. Xxxxxx, to me
known, who being by me duly sworn, did depose and say, that he/she resides at Wilmington,
Delaware, that he/she is the Assistant Vice President of Wilmington Trust Company, as Owner
Trustee, one of the corporations described in and which executed the above instrument; and
that he/she signed his/her name thereto by like order.
/s/ Xxxxxxx X. Xxxxxx
Notary Public
NOTARIAL SEAL
EXHIBIT A
FORM OF NOTES
CLASS A __ NOTES
UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST
COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE ISSUER OR ITS AGENT FOR REGISTRATION OF
TRANSFER, EXCHANGE OR PAYMENT, AND ANY NOTE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO.
OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY
PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY
OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN
INTEREST HEREIN.
THE PRINCIPAL OF THIS NOTE IS PAYABLE IN INSTALLMENTS AS SET FORTH HEREIN.
ACCORDINGLY, THE OUTSTANDING PRINCIPAL AMOUNT OF THIS NOTE AT ANY TIME MAY BE LESS THAN THE
AMOUNT SHOWN ON THE FACE HEREOF.
THIS NOTE DOES NOT REPRESENT AN INTEREST IN OR OBLIGATION OF THE SELLER, THE
DEPOSITOR, THE MASTER SERVICER, THE INDENTURE TRUSTEE, THE OWNER TRUSTEE OR ANY OF THEIR
RESPECTIVE AFFILIATES, EXCEPT AS EXPRESSLY PROVIDED IN THE INDENTURE OR THE BASIC DOCUMENTS.
EACH PURCHASER AND TRANSFEREE OF THIS NOTE, BY ITS ACCEPTANCE OF THIS NOTE, SHALL BE
DEEMED TO HAVE REPRESENTED AND WARRANTED THAT EITHER (I) IT IS NOT ACQUIRING THIS NOTE WITH
THE ASSETS OF AN "EMPLOYEE BENEFIT PLAN" AS DEFINED IN SECTION 3(3) OF THE EMPLOYEE
RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA"), WHICH IS SUBJECT TO THE
PROVISIONS OF TITLE I OF ERISA, A "PLAN" DESCRIBED IN SECTION 4975(e)(1) OF THE INTERNAL
REVENUE CODE OF 1986, AS AMENDED (THE "CODE"), AN ENTITY WHOSE UNDERLYING ASSETS INCLUDE
"PLAN ASSETS" BY REASON OF AN EMPLOYEE BENEFIT PLAN'S OR OTHER PLAN'S INVESTMENT IN SUCH
ENTITY OR ANY OTHER PLAN THAT IS SUBJECT TO A LAW THAT IS SIMILAR TO TITLE I OF ERISA OR
SECTION 4975 OF THE CODE OR (II) THE ACQUISITION AND HOLDING OF THIS NOTE WILL NOT GIVE RISE
TO A NON-EXEMPT PROHIBITED TRANSACTION UNDER SECTION 406 OF ERISA, SECTION 4975 OF THE CODE
OR ANY SIMILAR APPLICABLE LAW.
HOME LOAN TRUST 2006-HI2
HOME LOAN-BACKED NOTE
Registered Principal Amount: $___________
Class A __
No. __ Percentage Interest: _____%
CUSIP No. ___________ Note Rate: [___%][Adjustable Rate]
Home Loan Trust 2006-HI2, a statutory trust duly organized and existing under the
laws of the State of Delaware (herein referred to as the "Issuer"), for value received,
hereby promises to pay to Cede & Co. or registered assigns, the principal sum of
$___________, payable on each Payment Date in an amount equal to the Percentage Interest
specified above of the aggregate amount, if any, payable from the Payment Account in respect
of principal on the Class A-__ Notes pursuant to Section 3.05 of the Indenture dated as of
May 25, 2006 (the "Indenture") between the Issuer, as Issuer, and JPMorgan Chase Bank,
National Association, as Indenture Trustee (the "Indenture Trustee"); provided, however,
that the entire unpaid principal amount of this Note shall be due and payable on the Payment
Date in February 2036, to the extent not previously paid on a prior Payment Date.
Capitalized terms used but not defined herein are defined in Appendix A of the Indenture.
[Interest on the Class A-__ Notes will be paid monthly on each Payment Date at the
Note Rate. The Note Rate for the Class A-__ Notes will be _____% per annum. Interest will
be computed on the basis of a 30 day month and a 360 day year. Principal of and interest on
this Note shall be paid in the manner specified on the reverse hereof. On the Step Up Date,
the Note Rate on the Class A-__ Notes will increase by 0.50% per annum.]
[Interest on the Class A-1 Notes will be paid monthly on each Payment Date at the
Note Rate for the related Interest Accrual Period. The Note Rate for each Interest Accrual
Period will be equal to the lesser of (i) LIBOR plus___% per annum and (ii) ___% per annum.
LIBOR for each applicable Interest Accrual Period will be determined on the second LIBOR
Business Day immediately preceding (i) the Closing Date in the case of the first Interest
Accrual Period and (ii) the first day of each succeeding Interest Accrual Period by the
Indenture Trustee as set forth in the Indenture. All determinations of LIBOR by the
Indenture Trustee shall, in the absence of manifest error, be conclusive for all purposes,
and each holder of this Class A-1 Note, by accepting this Class A-1 Note, agrees to be bound
by such determination. Interest on this Class A-1 Note will accrue for each Payment Date
from the most recent Payment Date on which interest has been paid (in the case of the first
Payment Date, from the Closing Date) to but excluding such Payment Date. Interest will be
computed on the basis of the actual number of days in each Interest Accrual Period and a
year assumed to consist of 360 days. Principal of and interest on this Class A-1 Note shall
be paid in the manner specified in the Indenture.]
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
first to interest due and payable on this Note as provided above and then to the unpaid
principal of this Note.
Reference is made to the further provisions of this Note set forth on the reverse
hereof, which shall have the same effect as though fully set forth on the face of this Note.
Unless the certificate of authentication hereon has been executed by the Indenture
Trustee whose name appears below by manual signature, this Note shall not be entitled to any
benefit under the Indenture referred to on the reverse hereof, or be valid or obligatory for
any purpose.
This Note is one of a duly authorized issue of Notes of the Issuer, designated as its
Home Loan-Backed Notes (herein called the "Notes"), all issued under the Indenture, to which
Indenture and all indentures supplemental thereto reference is hereby made for a statement
of the respective rights and obligations thereunder of the Issuer, the Indenture Trustee and
the holders of the Notes. The Notes are subject to all terms of the Indenture.
The Notes are and will be equally and ratably secured by the Collateral pledged as
security therefor as provided in the Indenture.
This Note is entitled to the benefits of an irrevocable and unconditional financial
guaranty insurance policy issued by Financial Guaranty Insurance Company.
Principal of and interest on this Note will be payable on each Payment Date,
commencing on June 26, 2006, as described in the Indenture. "Payment Date" means the twenty
fifth day of each month, or, if any such date is not a Business Day, then the next Business
Day.
The entire unpaid principal amount of this Note shall be due and payable in full on
the Payment Date in February 2036, pursuant to the Indenture, to the extent not previously
paid on a prior Payment Date. Notwithstanding the foregoing, if an Event of Default shall
have occurred and be continuing, then the Indenture Trustee or the holders of Notes
representing not less than a majority of the aggregate Note Balance of all Notes with the
consent of the Credit Enhancer, or the Credit Enhancer may declare 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 paid in the manner and priority set forth in
Section 3.05 of the Indenture.
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, if
such Holder holds Notes of an aggregate initial Note Balance of at least $1,000,000, be paid
to each Holder of record on the preceding Record Date, by wire transfer to an account
specified in writing by such Holder reasonably satisfactory to the Indenture Trustee as of
the preceding Record Date or in all other cases or if no such instructions have been
delivered to the Indenture Trustee, by check or money order to such Noteholder mailed to
such Holder's address as it appears in the Note Register the amount required to be paid to
such Holder on such Payment Date pursuant to such Holder's Securities; provided, however,
that the Indenture Trustee shall not pay to such Holders any amount required to be withheld
from a payment to such Holder by the Code.
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 Corporate Trust Office, duly endorsed by, or accompanied
by a written instrument of transfer in form satisfactory to the Indenture Trustee 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 Note Registrar, which requirements include membership or participation in the Securities
Transfer Agent's Medallion Program ("STAMP") or such other "signature guarantee program" as
may be determined by the Note Registrar in addition to, or in substitution for, STAMP, all
in accordance with the Securities Exchange Act of 1934, as amended, and thereupon one or
more new Notes in 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 Note Registrar shall
require payment of a sum sufficient to cover any tax or governmental charge that may be
imposed in connection with any registration of transfer or exchange of this Note.
Each holder or Beneficial Owner of a Note, by acceptance of a Note, or, in the case
of a Beneficial Owner of a Note, 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, the Seller, the Master Servicer, the Depositor 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 or employee 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 holder or Beneficial Owner of a Note, by acceptance of a Note or, in the case of
a Beneficial Owner of a Note, a beneficial interest in a Note, covenants and agrees by
accepting the benefits of the Indenture that such holder or Beneficial Owner of a Note will
not at any time institute against the Depositor, the Seller, the Master Servicer or the
Issuer, or join in any institution against the Depositor, the Seller, the Master Servicer or
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, the Indenture 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. Each holder of a Note, by acceptance of a
Note (and each Beneficial Owner of a Note by acceptance of a beneficial interest in a Note),
agrees to treat the Notes for federal, state and local income, single business and franchise
tax purposes as indebtedness of the Issuer.
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 is registered (as of the day of determination or as of such
other date as may be specified in the Indenture) 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 Indenture
Trustee and the rights of the holders of the Notes under the Indenture at any time by the
Issuer and the Indenture Trustee with the consent of the holders of Notes representing a
majority of the aggregate Note Balance of all Notes at the time Outstanding and the Credit
Enhancer with prior notice to the Rating Agencies. The Indenture also contains provisions
permitting the holders of Notes representing specified percentages of the aggregate Note
Balance of all Notes, on behalf of the holders of all the Notes with the consent of the
Credit Enhancer, or the Credit Enhancer (so long as no Credit Enhancer Default exists), 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
Credit Enhancer and the holder of this Note (or any one of 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 Issuer and the Indenture Trustee to amend or waive certain terms and
conditions set forth in the Indenture without the consent of holders of the Notes issued
thereunder but with prior notice to the Rating Agencies and with the consent of the Credit
Enhancer.
The term "Issuer" as used in this Note includes any successor or the Issuer under the
Indenture.
The Issuer is permitted by the Indenture, under certain circumstances, to merge or
consolidate, subject to the rights of the Indenture Trustee and the holders of Notes 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.
This Note and the 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 and thereunder shall be determined in
accordance with such laws.
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 Wilmington Trust Company in its individual capacity, JPMorgan Chase
Bank, National Association, 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.
IN WITNESS WHEREOF, the Owner Trustee, on behalf of the Issuer and not in its
individual capacity, has caused this Note to be duly executed.
HOME LOAN TRUST 2006-HI2
By WILMINGTON TRUST COMPANY, not in its
individual capacity but solely as Owner
Trustee
Dated: May 25, 2006
By
Authorized Signatory
CERTIFICATE OF AUTHENTICATION
This is one of the Class A-__ Notes referred to in the within mentioned Indenture.
JPMORGAN CHASE BANK, NATIONAL ASSOCIATION, not in
its individual capacity but solely as Indenture
Trustee
Dated: May 25, 2006
By
Authorized Signatory
ASSIGNMENT
Social Security or taxpayer I.D. or other identifying number of assignee: ___________________
______________________________________________________________________________________________
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfer 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: __________________________(1)
Signature Guaranteed:
*This reconciliation and tie shall not, for any purpose, be deemed to be part of the within
indenture.
(1) 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 the Note Registrar, which
requirements include membership or participation in STAMP or such other "signature guarantee
program" as may be determined by the Note Registrar in addition to, or in substitution for,
STAMP, all in accordance with the Securities Exchange Act of 1934, as amended.