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Exhibit 10.3.2
INDEMNIFICATION AGREEMENT
among
FINANCIAL SECURITY ASSURANCE INC.,
TRIAD FINANCIAL CORPORATION
and
CREDIT SUISSE FIRST BOSTON
Dated as of November 1, 1998
Triad Auto Receivables Owner Trust 1998-4
$100,000,000 5.98% Asset Backed Notes, Class A
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TABLE OF CONTENTS
Page
Section 1. Definitions...........................................................................................1
Section 2. Representations, Warranties and Agreements of Financial Security......................................3
Section 3. Representations, Warranties and Agreements of the Underwriter.........................................5
Section 4. Indemnification.......................................................................................6
Section 5. Indemnification Procedures............................................................................7
Section 6. Contribution..........................................................................................8
Section 7. Miscellaneous.........................................................................................9
EXHIBIT A - Opinion of Assistant General Counsel
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INDEMNIFICATION AGREEMENT
INDEMNIFICATION AGREEMENT dated as of November 1, 1998, among FINANCIAL
SECURITY ASSURANCE INC. ("Financial Security"), TRIAD FINANCIAL CORPORATION (the
"Company") and CREDIT SUISSE FIRST BOSTON (the "Underwriter").
Section 2. Definitions. For purposes of this Agreement, the following terms
shall have the meanings provided below:
"Agreement" means this Indemnification Agreement, as the same may be
amended, supplemented or otherwise modified from time to time in accordance with
the terms hereof.
"Commission" means the Securities and Exchange Commission.
"Company Party" means any of the Company, its parent, subsidiaries and
affiliates and any shareholder, director, officer, employee, agent or
"controlling person" (as such term is used in the Securities Act) of any of the
foregoing.
"Federal Securities Laws" means the Securities Act, the Securities
Exchange Act of 1934, the Trust Indenture Act of 1939, the Investment Company
Act of 1940, the Investment Advisers Act of 1940 and the Public Utility Holding
Company Act of 1935, each as amended from time to time, and the rules and
regulations in effect from time to time under such Acts.
"Financial Security Agreements" means this Agreement, the Stock Pledge
Agreement, the Spread Account Agreement and the Insurance Agreement.
"Financial Security Information" has the meaning provided in
Section 2(g) hereof.
"Financial Security Party" means any of Financial Security, its parent,
subsidiaries and affiliates, and any shareholder, director, officer, employee,
agent or "controlling person" (as such term is used in the Securities Act) of
any of the foregoing.
"Indemnified Party" means any party entitled to any indemnification
pursuant to Section 4 hereof.
"Indemnifying Party" means any party required to provide
indemnification pursuant to Section 4 hereof.
"Indenture" means the Indenture dated as of November 1, 1998 between
Triad Auto Receivables Owner Trust 1998-4 and The Chase Manhattan Bank, as
trustee, as the same may be amended and supplemented from time to time in
accordance with its terms.
"Insurance Agreement" means the Insurance and Indemnity Agreement,
dated as of November 1, 1998, among Financial Security, Triad Auto Receivables
Owner Trust 1998-4, the
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Triad Financial Special Purpose Corporation II and the Company, as the same may
be amended, supplemented or otherwise modified from time to time in accordance
with the terms thereof.
"Losses" means (a) any actual out-of-pocket damages incurred by the
party entitled to indemnification or contribution hereunder, (b) any actual
out-of-pocket costs or expenses incurred by such party, including reasonable
fees or expenses of its counsel and other expenses incurred in connection with
investigating or defending any claim, action or other proceeding which entitle
such party to be indemnified hereunder (subject to the limitations set forth in
Section 5 hereof), to the extent not paid, satisfied or reimbursed from funds
provided by any other Person other than an affiliate of such party (provided
that the foregoing shall not create or imply any obligation to pursue recourse
against any such other Person), plus (c) interest on the amount paid by the
party entitled to indemnification or contribution from the date of such payment
to the date of payment by the party who is obligated to indemnify or contribute
hereunder at the statutory rate applicable to judgments for breach of contract.
"Note Policy" means the financial guaranty insurance policy delivered
by Financial Security with respect to the Securities.
"Offering Document" means the Prospectus and any other material or
documents delivered by the Underwriter or any Underwriter Party to any Person in
connection with the offer or sale of the Securities.
"Person" means any individual, partnership, joint venture, corporation,
trust, unincorporated organization or other organization or entity (whether
governmental or private).
"Prospectus" means, collectively, the Prospectus relating to the
Securities dated November 19, 1998, and the Prospectus Supplement.
"Prospectus Supplement" means the Prospectus Supplement dated December
10, 1998 relating to the Securities.
"Rating Agencies" has the meaning provided in the last paragraph of
Section 2 hereof.
"Securities" means the Triad Auto Receivables Owner Trust 1998-4
$100,000,000 5.98% Asset Backed Notes, Class A described in the Offering
Document and issued pursuant to the Indenture.
"Securities Act" means the Securities Act of 1933, as amended from time
to time, and any rule or regulation in effect from time to time under such Act.
"Spread Account Agreement" means the Master Spread Account Agreement
dated as of November 1, 1998, among the Triad Financial Special Purpose
Corporation II, Financial Security, the Collateral Agent and the Trustee
specified therein, as the same may be amended, supplemented or otherwise
modified from time to time in accordance with the terms thereof.
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"Stock Pledge Agreement" means the Stock Pledge and Collateral Agency
Agreement dated as of November 1, 1998 between the Company, Triad Financial
Special Purpose Corporation II, The Chase Manhattan Bank, as Collateral Agent,
and Financial Security Assurance.
"Underwriter Information" has the meaning provided in Section 3(c)
hereof.
"Underwriting Agreement" means the Underwriting Agreement dated as of
December 7, 1998 between the Company and the Underwriter with respect to the
offer and sale of the Securities, as the same may be amended, supplemented or
otherwise modified from time to time in accordance with the terms thereof.
"Underwriting Party" means any of the Underwriter, its parent,
subsidiaries and affiliates and any shareholder, director, officer, employee,
agent of "controlling person" (as such item is used in the Securities Act) of
any of the foregoing.
Section 3. Representations, Warranties and Agreements of Financial
Security. Financial Security represents, warrants and agrees with the parties
hereto as follows:
(a) Organization, Etc. Financial Security is a stock insurance
company duly organized, validly existing and authorized to transact
financial guaranty insurance business under the laws of the State of
New York.
(b) Authorization, Etc. The Note Policy and the Financial
Security Agreements have been duly authorized, executed and delivered
by Financial Security.
(c) Validity, Etc. The Note Policy and the Financial Security
Agreements constitute valid and binding obligations of Financial
Security, enforceable against Financial Security in accordance with
their terms, subject, as to the enforcement of remedies, to bankruptcy,
insolvency, reorganization, rehabilitation, moratorium and other
similar laws affecting the enforceability of creditors' rights
generally applicable in the event of the bankruptcy or insolvency of
Financial Security and to the application of general principles of
equity and subject, in the case of this Agreement, to principles of
public policy limiting the right to enforce the indemnification
provisions contained herein.
(d) Exemption From Registration. The Note Policy is exempt
from registration under the Securities Act.
(e) No Conflicts. Neither the execution or delivery by
Financial Security of the Note Policy or the Financial Security
Agreements, nor the performance by Financial Security of its
obligations thereunder, will conflict with any provision of the
certificate of incorporation or the bylaws of Financial Security nor
result in a breach of, or constitute a default under, any material
agreement or other instrument to which Financial Security is a
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party or by which any of its property is bound nor violate any
judgment, order or decree applicable to Financial Security of any
governmental or regulatory body, administrative agency, court or
arbitrator having jurisdiction over Financial Security (except that, in
the published opinion of the Securities and Exchange Commission, the
indemnification provisions of this Agreement, insofar as they relate to
indemnification for liabilities arising under the Securities Act, are
against public policy as expressed in the Securities Act and are
therefore unenforceable).
(f) Financial Information. The consolidated balance sheets of
Financial Security as of December 31, 1997 and December 31, 1996 and
the related consolidated statements of income, changes in shareholder's
equity and cash flows for the fiscal years then ended and the interim
consolidated balance sheet of Financial Security as of September 30,
1998, and the related statements of income, changes in shareholder's
equity and cash flows for the interim period then ended, furnished by
Financial Security to the Underwriter, fairly present in all material
respects the financial condition of Financial Security as of such dates
and for such periods in accordance with generally accepted accounting
principles consistently applied (subject as to interim statements to
normal year-end adjustments) and since the date of the most current
interim consolidated balance sheet referred to above there has been no
change in the financial condition of Financial Security which would
materially and adversely affect its ability to perform its obligations
under the Note Policy.
(g) Financial Security Information. The information in the
Prospectus Supplement set forth under the caption "THE INSURER"(as
revised from time to time in accordance with the provisions hereof, the
"Financial Security Information") is limited and does not purport to
provide the scope of disclosure required to be included in a prospectus
with respect to a registrant in connection with the offer and sale of
securities of such registrant registered under the Securities Act.
Within such limited scope of disclosure, however, as of the date of the
Prospectus Supplement and as of the date hereof, the Financial Security
Information does not contain any untrue statement of a material fact,
or omit to state a material fact necessary to make the statements
contained therein, in the light of the circumstances under which they
were made, not misleading.
(h) Additional Information. Financial Security will furnish to
the Underwriter or the Company, upon request of the Underwriter or the
Company, as the case may be, copies of Financial Security's most recent
financial statements (annual or interim, as the case may be) which
fairly present in all material respects the financial condition of
Financial Security as of the dates and for the periods indicated, in
accordance with generally accepted accounting principles consistently
applied except as noted therein (subject, as to interim statements, to
normal year-end adjustments). In addition, if the delivery of a
Prospectus relating to the Securities is required at any time prior to
the expiration of nine months after the time of issuance of the
Prospectus in connection with the offering or sale of the Securities,
the Company or the Underwriter will notify Financial Security of such
requirement to deliver a Prospectus and Financial Security will
promptly
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provide the Underwriter with any revisions to the Financial Security
Information that are in the judgment of Financial Security necessary to
prepare a supplement to the Prospectus.
(i) Opinion of Counsel. Financial Security will furnish to the
Underwriter and the Company, on the closing date for the sale of the
Securities an opinion of its Assistant General Counsel, to the effect
set forth in Exhibit A attached hereto, dated such closing date and
addressed to the Company and the Underwriter.
(j) Consents and Reports of Independent Accountants. Financial
Security will furnish to the Underwriter and the Company, upon request,
as comfort from its independent accountants in respect of its financial
condition, (i) at the expense of the Person specified in the Insurance
Agreement, a copy of the Prospectus, including either a manually signed
consent or a manually signed report of Financial Security's independent
accountants and (ii) the quarterly review letter by Financial
Security's independent accountants in respect of the most recent
interim financial statements of Financial Security.
Nothing in this Agreement shall be construed as a representation or warranty by
Financial Security concerning the rating of its insurance financial strength by
Xxxxx'x Investors Service, Inc. or its insurer financial strength by Standard &
Poor's Ratings Services, a division of The XxXxxx-Xxxx Companies, or any other
rating agency (collectively, the "Rating Agencies"). The Rating Agencies, in
assigning such ratings, take into account facts and assumptions not described in
the Prospectus and the facts and assumptions considered by the Rating Agencies,
and the ratings issued thereby, are subject to change over time.
Section 4. Representations, Warranties and Agreements of the
Underwriter. The Underwriter represents, warrants and agrees with the parties
hereto as follows:
(a) Compliance With Laws. The Underwriter will comply in all
material respects with all legal requirements in connection with offers
and sales of the Securities and make such offers and sales in the
manner provided in the Offering Document.
(b) Offering Document. The Underwriter will not use, or
distribute to other broker-dealers for use, any Offering Document in
connection with the offer and sale of the Securities unless such
Offering Document includes such information as has been furnished by
Financial Security for inclusion therein and the information therein
concerning Financial Security has been approved by Financial Security
in writing. Financial Security hereby consents to the information in
respect of Financial Security included in the Prospectus Supplement.
Each Offering Document will include the following statement:
"The Note Policy is not covered by the property/casualty
insurance security fund specified in Article 76 of the New
York Insurance Law".
Each Offering Document including financial information with respect to
Financial Security prepared in accordance with generally accepted
accounting principles will include the following statement immediately
preceding such financial information:
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"The New York State Insurance Department recognizes only
statutory accounting practices for determining and reporting
the financial condition and results of operations of an
insurance company, for determining its solvency under the New
York Insurance Law, and for determining whether its financial
condition warrants the payment of a dividend to its
stockholders. No consideration is given by the New York State
Insurance Department to financial statements prepared in
accordance with generally accepted accounting principles in
making such determinations."
(c) Underwriter Information. All material provided by the
Underwriter for inclusion in the Offering Document (as revised from
time to time, the "Underwriter Information"), insofar as such
information relates to the Underwriter is true and correct in all
material respects. In respect of the Prospectus Supplement, the
Underwriter Information is limited to the information set forth on the
cover page in the third paragraph and the information set under the
caption "UNDERWRITING".
Section 5. Indemnification.
(a) Financial Security agrees, upon the terms and subject to
the conditions provided herein, to indemnify, defend and hold harmless
each Company Party and each Underwriter Party against (i) any and all
Losses incurred by them with respect to the offer and sale of the
Securities and resulting from Financial Security's breach of any of its
representations, warranties or agreements set forth in Section 2 hereof
and (ii) any and all Losses to which any Company Party or Underwriter
Party may become subject, under the Securities Act or otherwise,
insofar as such Losses arise out of or result from an untrue statement
of a material fact contained in any Offering Document or the omission
to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, in each case
to the extent, but only to the extent, that such untrue statement or
omission was made in the Financial Security Information included
therein in accordance with the provisions hereof.
(b) The Underwriter agrees, upon the terms and subject to the
conditions provided herein, to indemnify, defend and hold harmless each
Financial Security Party against (i) any and all Losses incurred by
them with respect to the offer and sale of the Securities and resulting
from the Underwriter's breach of any of its representations, warranties
or agreements set forth in Section 3 hereof and (ii) any and all Losses
to which any Financial Security Party may become subject, under the
Securities Act or otherwise, insofar as such Losses arise out of or
result from an untrue statement of a material fact contained in any
Offering Document or the omission to state therein a material fact
required to be stated therein or necessary to make the statements
therein not misleading, in each case to the extent, but only to the
extent, that such untrue statement or omission was made in the
Underwriter Information included therein.
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(c) Upon the incurrence of any Losses for which a party is
entitled to indemnification hereunder, the Indemnifying Party shall
reimburse the Indemnified Party promptly upon establishment by the
Indemnified Party to the Indemnifying Party of the Losses incurred.
Section 6. Indemnification Procedures. Except as provided below in
Section 6 with respect to contribution, the indemnification provided herein by
an Indemnifying Party shall be the exclusive remedy of any and all Indemnified
Parties for the breach of a representation, warranty or agreement hereunder by
an Indemnifying Party; provided, however, that each Indemnified Party shall be
entitled to pursue any other remedy at law or in equity for any such breach so
long as the damages sought to be recovered shall not exceed the Losses incurred
thereby resulting from such breach. In the event that any action or regulatory
proceeding shall be commenced or claim asserted which may entitle an Indemnified
Party to be indemnified under this Agreement, such party shall give the
Indemnifying Party written or telegraphic notice of such action or claim
reasonably promptly after receipt of written notice thereof. The Indemnifying
Party shall be entitled to participate in and, upon notice to the Indemnified
Party, assume the defense of any such action or claim in reasonable cooperation
with, and with the reasonable cooperation of, the Indemnified Party. The
Indemnified Party shall have the right to employ separate counsel in any such
action and to participate in the defense thereof at the expense of the
Indemnified Party; provided, however, that the fees and expenses of such
separate counsel shall be at the expense of the Indemnifying Party if (i) the
Indemnifying Party has agreed to pay such fees and expenses, (ii) the
Indemnifying Party shall have failed to assume the defense of such action or
proceeding and employ counsel satisfactory to the Indemnified Party in any such
action or proceeding or (iii) the named parties to any such action or proceeding
(including any impleaded parties) include both the Indemnified Party and the
Indemnifying Party, and the Indemnified Party shall have been advised by counsel
that (A) there may be one or more legal defenses available to it which are
different from or additional to those available to the Indemnifying Party and
(B) the representation of the Indemnifying Party and the Indemnified Party by
the same counsel would be inappropriate or contrary to prudent practice, in
which case, if the Indemnified Party notifies the Indemnifying Party in writing
that it elects to employ separate counsel at the expense of the Indemnifying
Party, the Indemnifying Party shall not have the right to assume the defense of
such action or proceeding on behalf of such Indemnified Party, it being
understood, however, that the Indemnifying Party shall not, in connection with
any one such action or proceeding or separate but substantially similar or
related actions or proceedings in the same jurisdiction arising out of the same
general allegations or circumstances, be liable for the reasonable fees and
expenses of more than one separate firm of attorneys at any time for all the
Company Parties, one such firm for all Underwriter Parties and one such firm for
all Financial Security Parties, as the case may be, which firm shall be
designated in writing by the Company in respect of the Company Parties, by the
Underwriter in respect of the Underwriter Parties and by Financial Security in
respect of the Financial Security Parties. The Indemnifying Party shall not be
liable for any settlement of any such claim or action unless the Indemnifying
Party shall have consented thereto or be in default in its obligations
hereunder. Any failure by an Indemnified Party to comply with the provisions of
this Section shall relieve the Indemnifying Party of liability only if such
failure is prejudicial to the position of the Indemnifying Party and then only
to the extent of such prejudice.
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Section 7. Contribution.
(a) To provide for just and equitable contribution if the
indemnification provided by any Indemnifying Party is determined to be
unavailable for any Indemnified Party (other than due to application of this
Section), each Indemnifying Party shall contribute to the Losses arising from
any breach of any of its representations, warranties or agreements contained in
this Agreement on the basis of the relative fault of each of the parties as set
forth in Section 6(b) below; provided, however, that an Indemnifying Party shall
in no event be required to contribute to all Indemnified Parties an aggregate
amount in excess of the Losses incurred by such Indemnified Parties resulting
from the breach of representations, warranties or agreements contained in this
Agreement.
(b) The relative fault of each Indemnifying Party, on the one hand, and
of each Indemnified Party, on the other, shall be determined by reference to,
among other things, whether the breach of, or alleged breach of, any
representations, warranties or agreements contained in this Agreement relates to
information supplied by, or action within the control of, the Indemnifying Party
or the Indemnified Party and the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such breach.
(c) The parties agree that Financial Security shall be solely
responsible for the Financial Security Information and the Underwriter shall be
solely responsible for the Underwriter Information and that the balance of each
Offering Document shall be the responsibility of the Company.
(d) Notwithstanding anything in this Section 6 to the contrary, the
Underwriter shall not be required to contribute an amount in excess of the
amount by which the total underwriting discounts and commissions received by the
Underwriter exceeds the amount of any damages that such Underwriter has
otherwise been required to pay in respect of any breach by the Underwriter of
its representations or warranties contained in Section 3 hereof.
(e) No Person guilty of fraudulent misrepresentation (within the
meaning of Section 11(f) of the Securities Act) shall be entitled to
contribution from any Person who was not guilty of such fraudulent
misrepresentation.
(f) Upon the incurrence of any Losses entitled to contribution
hereunder, the contributor shall reimburse the party entitled to contribution
promptly upon establishment by the party entitled to contribution to the
contributor of the Losses incurred.
Section 8. Miscellaneous.
(a) Notices. All notices and other communications provided for under
this Agreement shall be delivered to the address set forth below or to such
other address as shall be designated by the recipient in a written notice to the
other party or parties hereto:
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If to Financial Security: Financial Security Assurance Inc.
000 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Senior Vice President -- Transaction
Oversight Department (with a copy to the attention
of the General Counsel)
Re: Triad Auto Receivables Owner Trust, 1998-4,
$100,000,000 5.98% Asset Backed Notes, Class A.
Confirmation: (000) 000-0000
Facsimile Nos.: (000) 000-0000, (000) 000-0000
(in each case in which notice or other communication
to Financial Security refers to an Event of Default,
a claim on the Note Policy or with respect to which
failure on the part of Financial Security to respond
shall be deemed to constitute consent or acceptance,
then a copy of such notice or other communication
should also be sent to the attention of each of the
General Counsel and the Head-Financial Guaranty Group
and shall be marked to indicate "URGENT MATERIAL
ENCLOSED.")
If to the Company: Triad Financial Corporation
0000 Xxxxxx Xxxxxx, Xxxxx 000
Xxxxxxxxxx Xxxxx, Xxxxxxxxxx 00000
Facsimile No: (000) 000-0000
Confirm No: (000) 000-0000
If to the Underwriter: Credit Suisse First Boston
Eleven Madison Avenue
New York, New York 10010
Attention: Legal Department
Facsimile No: (000) 000-0000
Confirm No: (000) 000-0000
(b) Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
(c) Assignments. This Agreement may not be assigned by any party
without the express written consent of each other party. Any assignment made in
violation of this Agreement shall be null and void.
(d) Amendments. Amendments of this Agreement shall be in writing signed
by each party hereto.
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(e) Survival, Etc. The indemnity and contribution agreements contained
in this Agreement shall remain operative and in full force and effect,
regardless of (i) any investigation made by or on behalf of any Indemnifying
Party, (ii) the issuance of the Securities or (iii) any termination of this
Agreement or the Note Policy. The indemnification provided in this Agreement
will be in addition to any liability which the parties may otherwise have and
shall in no way limit any obligations of the parties to the Underwriting
Agreement or the Insurance Agreement.
(f) Counterparts. This Agreement may be executed in counterparts by the
parties hereto, and all such counterparts shall constitute one and the same
instrument.
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IN WITNESS WHEREOF, the parties hereto have caused this Indemnification
Agreement to be duly executed and delivered as of the date first above written.
FINANCIAL SECURITY ASSURANCE INC.
By:
--------------------------------------
Name:
Title:
TRIAD FINANCIAL CORPORATION
By:
--------------------------------------
Name:
Title:
CREDIT SUISSE FIRST BOSTON
By:
--------------------------------------
Name:
Title:
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EXHIBIT A
OPINION OF ASSISTANT GENERAL COUNSEL
Based upon the foregoing, I am of the opinion that:
1. Financial Security is a stock insurance company duly organized,
validly existing and authorized to transact financial guaranty insurance
business under the laws of the State of New York.
2. The Note Policy and the Financial Security Agreements have been duly
authorized, executed and delivered by Financial Security.
3. The Note Policy and the Financial Security Agreements constitute
valid and binding obligations of Financial Security, enforceable against
Financial Security in accordance with their terms, subject, as to the
enforcement of remedies, to bankruptcy, insolvency, reorganization,
rehabilitation, moratorium and other similar laws affecting the enforceability
of creditors' rights generally applicable in the event of the bankruptcy or
insolvency of Financial Security and to the application of general principles of
equity and subject, in the case of the Indemnification Agreement, to principles
of public policy limiting the right to enforce the indemnification provisions
contained therein insofar as they relate to indemnification for liabilities
arising under applicable securities laws.
4. The Note Policy is exempt from registration under the Securities Act
of 1933, as amended (the "Act").
5. Neither the execution nor delivery by Financial Security of the Note
Policy or the Financial Security Agreements, nor the performance by Financial
Security of its obligations thereunder, will conflict with any provision of the
certificate of incorporation or the bylaws of Financial Security or, to the best
of my knowledge, result in a breach of, or constitute a default under, any
agreement or other instrument to which Financial Security is a party or by which
it or any of its property is bound or, to the best of my knowledge, violate any
judgment, order or decree applicable to Financial Security of any governmental
or regulatory body, administrative agency, court or arbitrator having
jurisdiction over Financial Security (except that in the published opinion of
the Securities and Exchange Commission the indemnification provisions of the
Indemnification Agreement, insofar as they relate to indemnification for
liabilities arising under the Act, are against public policy as expressed in the
Act and are therefore unenforceable).
In addition, please be advised that I have reviewed the description of
Financial Security under the caption "THE INSURER" in the Prospectus Supplement
dated December 10, 1998 (the "Offering Document") with respect to the
Securities. The information provided in the Offering
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Document with respect to Financial Security is limited and does not purport to
provide the scope of disclosure required to be included in a prospectus with
respect to a registrant under the Act in connection with the public offer and
sale of securities of such registrant. Within such limited scope of disclosure,
however, there has not come to my attention any information which would cause me
to believe that the description of Financial Security referred to above, as of
the date of the Offering Document, contained any untrue statement of a material
fact or omitted to state a material fact necessary to make the statements
therein, in the light of the circumstances under which they were made, not
misleading (except that no opinion is rendered with respect to any financial
statements or other financial information contained or referred to therein).
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