EXHIBIT 4.5
INDENTURE
between
AEGIS ASSET BACKED SECURITIES CORPORATION [ ] TRUST [ ],
as Issuer
and
[ ]
as Indenture Trustee
Dated as of [ ]
AEGIS ASSET BACKED SECURITIES CORPORATION [ ] TRUST [ ],
Asset Backed Notes, Series [ ]
TABLE OF CONTENTS
Page
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ARTICLE I DEFINITIONS.........................................................................................................2
Section 1.01. Definitions..............................................................................................2
Section 1.02. Incorporation by Reference of Trust Indenture Act........................................................6
Section 1.03. Rules of Construction....................................................................................7
ARTICLE II THE NOTES..........................................................................................................7
Section 2.01. Form.....................................................................................................7
Section 2.02. Execution, Authentication, Delivery and Dating...........................................................8
Section 2.03. Registration; Registration of Transfer and Exchange......................................................8
Section 2.04. Mutilated, Destroyed, Lost or Stolen Notes..............................................................10
Section 2.05. Persons Deemed Note Owners..............................................................................10
Section 2.06. Payment of Principal and Interest; Defaulted Interest...................................................11
Section 2.07. Cancellation............................................................................................12
Section 2.08. Conditions Precedent to the Authentication of the Notes.................................................12
Section 2.09. Release of Collateral...................................................................................14
Section 2.10. Book-Entry Notes........................................................................................15
Section 2.11. Notices to Clearing Agency..............................................................................15
Section 2.12. Definitive Notes........................................................................................16
Section 2.13. Tax Treatment...........................................................................................16
ARTICLE III COVENANTS........................................................................................................16
Section 3.01. Payment of Principal and Interest.......................................................................16
Section 3.02. Maintenance of Office or Agency.........................................................................17
Section 3.03. Money for Payments to Be Held in Trust..................................................................17
Section 3.04. Existence...............................................................................................19
Section 3.05. Protection of Collateral................................................................................19
Section 3.06. Annual Opinions as to Collateral........................................................................20
Section 3.07. Performance of Obligations; Servicing of Mortgage Loans.................................................20
Section 3.08. Negative Covenants......................................................................................21
Section 3.09. Annual Statement as to Compliance.......................................................................22
Section 3.10. Covenants of the Issuer.................................................................................23
Section 3.11. Servicers' Obligations..................................................................................23
Section 3.12. Restricted Payments.....................................................................................23
Section 3.13. Issuer May Consolidate, etc., Only on Certain Terms.....................................................23
Section 3.14. Successor or Transferee.................................................................................25
Section 3.15. Treatment of Notes as Debt for Tax Purposes.............................................................25
Section 3.16. Notice of Events of Default.............................................................................25
Section 3.17. Further Instruments and Acts............................................................................26
ARTICLE IV SATISFACTION AND DISCHARGE........................................................................................26
Section 4.01. Satisfaction and Discharge of Indenture.................................................................26
Section 4.02. Application of Trust Money..............................................................................27
Section 4.03. Repayment of Moneys Held by Paying Agent................................................................27
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ARTICLE V REMEDIES...........................................................................................................27
Section 5.01. Events of Default.......................................................................................27
Section 5.02. Acceleration of Maturity; Rescission and Annulment......................................................29
Section 5.03. Collection of Indebtedness and Suits for Enforcement by
Indenture Trustee.......................................................................................30
Section 5.04. Remedies; Priorities....................................................................................32
Section 5.05. Optional Preservation of the Collateral.................................................................33
Section 5.06. Limitation of Suits.....................................................................................33
Section 5.07. Unconditional Rights of Noteholders to Receive Principal and Interest...................................34
Section 5.08. Restoration of Rights and Remedies......................................................................34
Section 5.09. Rights and Remedies Cumulative..........................................................................35
Section 5.10. Delay or Omission Not a Waiver..........................................................................35
Section 5.11. Control by Noteholders..................................................................................35
Section 5.12. Waiver of Past Defaults.................................................................................36
Section 5.13. Undertaking for Costs...................................................................................36
Section 5.14. Waiver of Stay or Extension Laws........................................................................36
Section 5.15. Action on Notes.........................................................................................37
Section 5.16. Performance and Enforcement of Certain Obligations......................................................37
ARTICLE VI THE INDENTURE TRUSTEE.............................................................................................38
Section 6.01. Duties of Indenture Trustee.............................................................................38
Section 6.02. Rights of Indenture Trustee.............................................................................39
Section 6.03. Individual Rights of Indenture Trustee..................................................................40
Section 6.04. Indenture Trustee's Disclaimer..........................................................................40
Section 6.05. Notices of Default......................................................................................40
Section 6.06. Reports by Indenture Trustee to Holders.................................................................40
Section 6.07. Compensation and Indemnity..............................................................................40
Section 6.08. Replacement of Indenture Trustee........................................................................41
Section 6.09. Successor Indenture Trustee by Merger...................................................................42
Section 6.10. Appointment of Co-Indenture Trustee or Separate Indenture Trustee.......................................42
Section 6.11. Eligibility; Disqualification...........................................................................44
Section 6.12. Preferential Collection of Claims Against Issuer........................................................44
Section 6.13. Appointment of Agent....................................................................................44
ARTICLE VII NOTEHOLDERS' LISTS AND REPORTS'..................................................................................44
Section 7.01. Issuer to Furnish Indenture Trustee Names and Addresses of Noteholders..................................44
Section 7.02. Preservation of Information; Communications to Noteholders..............................................45
Section 7.03. Reports by Issuer.......................................................................................45
Section 7.04. Reports by Indenture Trustee............................................................................45
ARTICLE VIII ACCOUNTS, DISBURSEMENTS AND RELEASES............................................................................46
Section 8.01. Collection of Money.....................................................................................46
Section 8.02. Trust Accounts; Distributions...........................................................................46
Section 8.03. General Provisions Regarding Accounts...................................................................47
Section 8.04. Servicer's Monthly Statements...........................................................................47
Section 8.05. Release of Collateral...................................................................................47
Section 8.06. Opinion of Counsel......................................................................................48
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ARTICLE IX SUPPLEMENTAL INDENTURES...........................................................................................48
Section 9.01. Supplemental Indentures Without Consent of Noteholders..................................................48
Section 9.02. Supplemental Indentures with Consent of Noteholders.....................................................50
Section 9.03. Execution of Supplemental Indentures....................................................................51
Section 9.04. Effect of Supplemental Indentures.......................................................................51
Section 9.05. Conformity with Trust Indenture Act.....................................................................51
Section 9.06. Reference in Notes to Supplemental Indentures...........................................................51
Section 9.07. Amendments to Trust Agreement...........................................................................52
ARTICLE X REDEMPTION OF NOTES................................................................................................52
Section 10.01. Redemption..............................................................................................52
Section 10.02. Form of Redemption Notice...............................................................................52
Section 10.03. Notes Payable on Redemption Date; Provision for Payment of Indenture Trustee and Note Insurer...........53
ARTICLE XI MISCELLANEOUS.....................................................................................................53
Section 11.01. Compliance Certificates and Opinions, etc...............................................................53
Section 11.02. Form of Documents Delivered to Indenture Trustee........................................................55
Section 11.03. Acts of Noteholders.....................................................................................55
Section 11.04. Notices, etc., to Indenture Trustee, Issuer, Rating Agencies and Note Insurer...........................56
Section 11.05. Notices to Noteholders; Waiver..........................................................................56
Section 11.06. Conflict with Trust Indenture Act.......................................................................57
Section 11.07. Effect of Headings and Table of Contents................................................................57
Section 11.08. Successors and Assigns..................................................................................57
Section 11.09. Separability............................................................................................57
Section 11.10. Benefits of Indenture...................................................................................58
Section 11.11. Legal Holidays..........................................................................................58
Section 11.12. Governing Law...........................................................................................58
Section 11.13. Counterparts............................................................................................58
Section 11.14. Recording of Indenture..................................................................................58
Section 11.15. Trust Obligation........................................................................................58
Section 11.16. No Petition.............................................................................................59
Section 11.17. Inspection..............................................................................................59
Section 11.18. [Grant of Noteholder Rights to Note Insurer]............................................................59
Section 11.19. [Third Party Beneficiary]...............................................................................60
Section 11.20. [Suspension and Termination of Note Insurer's Rights]...................................................60
Exhibits
EXHIBIT A Form of Notes
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This Indenture dated as of [ ], between AEGIS ASSET BACKED
SECURITIES CORPORATION [ ] TRUST [ ], a
[Delaware] business trust, as Issuer (the "Issuer"), and
[ ], as Indenture Trustee (the "Indenture Trustee"),
W I T N E S S E T H T H A T:
In consideration of the mutual covenants herein contained, the Issuer
and the Indenture Trustee hereby agree as follows for the benefit of each of
them and for the equal and ratable benefit of the holders of the Notes:
GRANTING CLAUSE
Subject to the terms of this Indenture, the Issuer hereby Grants on the
Closing Date to the Indenture Trustee, as Indenture Trustee for the benefit of
the Holders of the Notes [and the Note Insurer], all of the Issuer's right,
title and interest in and to: (i) the Trust Estate (as defined in the Sale and
Collection Agreement); (ii) the Issuer's rights and benefits but none of its
obligations under the Sale and Collection Agreement (including the Issuer's
right to cause the [Depositor] to repurchase Mortgage Loans from the Issuer
under certain circumstances described therein); (iii) the Trust Accounts, all
amounts and property in the Trust Accounts from time to time, and the Security
Entitlements to all Financial Assets credited to the Trust Accounts from time to
time; and (iv) the Issuer's rights and benefits but none of its obligations
under the [Custodial Agreement], (v) the Issuer's rights and benefits but none
of its obligations under the Administration Agreement; (vi) the Issuer's rights
and benefits but none of its obligations under the [Mortgage Loan Sale
Agreement], (vii) all other property of the Trust from time to time and (viii)
all present and future claims, demands, causes of action and choses in action in
respect of any or all of the foregoing and all payments on or under and all
proceeds of every kind and nature whatsoever in respect of any or all of the
foregoing, including all proceeds of the conversion thereof, voluntary or
involuntary, into cash or other liquid property, all cash proceeds, accounts,
accounts receivable, notes, drafts, acceptances, chattel paper, checks, deposit
accounts, insurance proceeds, condemnation awards, rights to payment of any and
every kind and other forms of obligations and receivables, instruments and other
property which at any time constitute all or part of or are included in the
proceeds of any of the foregoing (collectively, the "Collateral").
The foregoing Grant is made in trust to secure the payment of principal
of and interest on, and any other amounts owing in respect of, the Notes, and to
secure compliance with the provisions of this Indenture, all as provided in this
Indenture.
The Indenture Trustee, as Indenture Trustee on behalf of the Holders of
the Notes [and the Note Insurer], acknowledges such Grant, accepts the trusts
hereunder and agrees to perform the duties required of it in this Indenture to
the best of its ability to the end that the interests of the Holders of the
Notes [and the Note Insurer] may adequately and effectively be protected. The
Indenture Trustee agrees and acknowledges that the Indenture Trustee's Loan
Files will be held by the Custodian for the benefit of the Indenture Trustee in
[ ]. The Indenture Trustee further agrees and acknowledges
that each other item of Collateral that is
physically delivered to the Indenture Trustee will be held by the Indenture
Trustee in [ ].
ARTICLE I
DEFINITIONS
Section 1.01. Definitions.
(a) Except as otherwise specified herein or as the context may otherwise
require, the following terms have the respective meanings set forth below for
all purposes of this Indenture.
Act: The meaning specified in Section 11.03(a) hereof.
Administration Agreement: The Administration Agreement dated as of
[ ] between the Issuer and [ ], as administrator.
Administrator: [ ], or any successor thereto.
Authorized Officer: With respect to the Issuer, any officer of the Owner
Trustee who is authorized to act for the Owner Trustee in matters relating to
the Issuer and who is identified on the list of Authorized Officers delivered by
the Owner Trustee to the Indenture Trustee [and the Note Insurer] on the Closing
Date (as such list may be modified or supplemented from time to time thereafter)
and, so long as the Administration Agreement is in effect, any officer of the
Administrator who is authorized to act for the Administrator in matters relating
to the Issuer and to be acted upon by the Administrator pursuant to the
Administration Agreement and who is identified on the list of Authorized
Officers delivered by the Administrator to the Indenture Trustee [and the Note
Insurer] on the Closing Date (as such list may be modified or supplemented from
time to time thereafter).
Book-Entry Notes: A beneficial interest in any Class of Notes, ownership
and transfers of which shall be made through book entries by a Clearing Agency
as described in Section 2.10 hereof.
Certificate of Trust: The certificate of trust of the Issuer
substantially in the form of Exhibit B to the Trust Agreement.
Clearing Agency Participant: A broker, dealer, bank, other financial
institution or other Person for which from time to time a Clearing Agency
effects book-entry transfers and pledges of securities deposited with the
Clearing Agency.
Collateral: The meaning specified in the Granting Clause of this
Indenture.
Corporate Trust Office: The principal office of the Indenture Trustee at
which at any particular time its corporate trust business shall be administered,
which office at date of execution of this Agreement is located at
[ ]; Attention: [ ], or at such
other address as the Indenture Trustee may designate from time to time by notice
to the Noteholders, [the Note Insurer] and the Issuer, or the principal
corporate trust office of any successor Indenture Trustee at the address
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designated by such successor Indenture Trustee by notice to the Noteholders,
[the Note Insurer] and the Issuer.
Default: Any occurrence that is, or with notice or the lapse of time or
both would become, an Event of Default.
Definitive Notes: The meaning specified in Section 2.12 hereof.
Depository Institution: Any depository institution or trust company,
including the Indenture Trustee, that (a) is incorporated under the laws of the
United States of America or any State thereof, (b) is subject to supervision and
examination by federal or state banking authorities and (c) has outstanding
unsecured commercial paper or other short-term unsecured debt obligations that
are rated in the highest rating category by each Rating Agency, or is otherwise
acceptable to each Rating Agency.
Event of Default: The meaning specified in Section 5.01 hereof.
Executive Officer: With respect to any corporation, the Chief Executive
Officer, Chief Operating Officer, Chief Financial Officer, President, Executive
Vice President, any Vice President, the Secretary or the Treasurer of such
corporation; and with respect to any partnership, any general partner thereof.
Grant: Mortgage, pledge, bargain, sell, warrant, alienate, remise,
release, convey, assign, transfer, create and xxxxx x xxxx upon and a security
interest in and right of set-off against, deposit, set over and confirm pursuant
to this Indenture. A Grant of the Collateral or of any other agreement or
instrument shall include all rights, powers and options (but none of the
obligations) of the granting party thereunder, including the immediate and
continuing right to claim for, collect, receive and give receipt for principal
and interest payments in respect of the Collateral and all other moneys payable
thereunder, to give and receive notices and other communications, to make
waivers or other agreements, to exercise all rights and options, to bring
Proceedings in the name of the granting party or otherwise, and generally to do
and receive anything that the granting party is or may be entitled to do or
receive thereunder or with respect thereto.
Highest Priority Class Notes: The Class [ ] Notes.
Holder or Noteholder: The Person in whose name a Note is registered on
the Note Register.
Independent: When used with respect to any specified Person, that the
Person (a) is in fact independent of the Issuer, any other obligor on the Notes,
the Seller and any Affiliate of any of the foregoing Persons, (b) does not have
any direct financial interest or any material indirect financial interest in the
Issuer, any such other obligor, the Seller or any Affiliate of any of the
foregoing Persons and (c) is not connected with the Issuer, any such other
obligor, the Seller or any Affiliate of any of the foregoing Persons as an
officer, employee, promoter, underwriter, trustee, partner, director or person
performing similar functions.
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Independent Certificate: A certificate or opinion to be delivered to the
Indenture Trustee [and the Note Insurer] under the circumstances described in,
and otherwise complying with, the applicable requirements of Section 11.01
hereof, made by an Independent appraiser or other expert appointed by an Issuer
Order and approved by the Indenture Trustee [and the Note Insurer] in the
exercise of reasonable care, and such opinion or certificate shall state that
the signer has read the definition of "Independent" in this Indenture and that
the signer is Independent within the meaning thereof.
Issuer: Aegis Asset Backed Securities Corporation [ ] Trust
[ ] until a successor replaces it and, thereafter, means the successor and,
for purposes of any provision contained herein and required by the TIA, each
other obligor on the Notes.
Issuer Order and Issuer Request: A written order or request signed in
the name of the Issuer by any one of its Authorized Officers and delivered to
the Indenture Trustee.
Majority Highest Priority Class Noteholders: On any date, Holders of
Highest Priority Class Notes representing more than [__]% of the Voting
Interests of the Highest Priority Class Notes then Outstanding.
Maturity Date: [ ].
Non-Priority Class: As of any date of determination, any outstanding
Class of Notes other than the Highest Priority Class Notes.
Note Depository Agreement: The agreement to be entered into among the
Issuer, the Administrator, the Indenture Trustee and The Depository Trust
Company, as the initial Clearing Agency, relating to the Book-Entry Notes.
Note Owner: With respect to a Book-Entry Note, the Person that is the
beneficial owner of such Book-Entry Note, as reflected on the books of the
Clearing Agency or on the books of a Person maintaining an account with such
Clearing Agency (directly as a Clearing Agency Participant or as an indirect
participant, in each case in accordance with the rules of such Clearing Agency),
and with respect to a Definitive Note, the Person that is the beneficial owner
of such Note as reflected in the Note Register.
Note Register and Note Registrar: The respective meanings specified in
Section 2.03 hereof. The initial Note Registrar shall be [ ].
Officer's Certificate: A certificate signed by any Authorized Officer of
the Issuer or the Administrator, under the circumstances described in, and
otherwise complying with, the applicable requirements of Section 11.01 hereof,
and delivered to the Indenture Trustee. Unless otherwise specified, any
reference in this Indenture to an Officer's Certificate shall be to an Officer's
Certificate of any Authorized Officer of the Issuer or the Administrator.
Opinion of Counsel: One or more written opinions of counsel who may,
except as otherwise expressly provided in this Indenture, be an employee of or
counsel to the Issuer and who shall be satisfactory to the Indenture Trustee
[and the Note Insurer], and which opinion or opinions shall be addressed to the
Indenture Trustee, as Indenture Trustee, [and the Note Insurer]
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and shall comply with any applicable requirements of Section 11.01 hereof and
shall be in form and substance satisfactory to the Indenture Trustee [and the
Note Insurer].
Outstanding: With respect to any Note and as of the date of
determination, any Note theretofore authenticated and delivered under this
Indenture except:
(i) Notes theretofore cancelled by the Note Registrar or
delivered to the Note Registrar for cancellation;
(ii) Notes or portions thereof the payment for which money in
the necessary amount has theretofore been deposited with the Indenture
Trustee or any Paying Agent in trust for the Holders of such Notes
(provided, however, that if such Notes are to be redeemed, notice of
such redemption has been duly given pursuant to this Indenture or
provision for such notice satisfactory to the Indenture Trustee has been
made);
(iii) Notes in exchange for or in lieu of which other Notes
have been authenticated and delivered pursuant to this Indenture unless
proof satisfactory to the Indenture Trustee is presented that any such
Notes are held by a bona fide purchaser; provided, however, that in
determining whether the Holders of the requisite Voting Interests of the
Outstanding Notes have given any request, demand, authorization,
direction, notice, consent or waiver hereunder or under any Basic
Document, Notes owned by the Issuer, any other obligor upon the Notes,
the Seller or any Affiliate of any of the foregoing Persons shall be
disregarded and deemed not to be Outstanding, except that, in
determining whether the Indenture Trustee shall be protected in relying
upon any such request, demand, authorization, direction, notice, consent
or waiver, only Notes that the Indenture Trustee knows to be owned in
such manner shall be disregarded. Notes owned in such manner that have
been pledged in good faith may be regarded as Outstanding if the pledgee
establishes to the satisfaction of the Indenture Trustee that the
pledgee has the right so to act with respect to such Notes and that the
pledgee is not the Issuer, any other obligor upon the Notes, the Seller
or any Affiliate of any of the foregoing Persons; and
(iv) Notes for which the related Maturity Date has occurred.
Outstanding Amount: The aggregate principal amount of all Notes, or
Class of Notes, as applicable, Outstanding at the date of determination.
Paying Agent: The Indenture Trustee or any other Person that meets the
eligibility standards for the Indenture Trustee specified in Section 6.11 hereof
and is authorized by the Issuer to make payments to and distributions from the
Note Payment Account, including payments of principal of or interest on the
Notes on behalf of the Issuer. The initial Paying Agent shall be [ ].
Predecessor Note: With respect to any particular Note, every previous
Note evidencing all or a portion of the same debt as that evidenced by such
particular Note; and, for the purpose of this definition, any Note authenticated
and delivered under Section 2.04 hereof in lieu of a mutilated, lost, destroyed
or stolen Note shall be deemed to evidence the same debt as the mutilated, lost,
destroyed or stolen Note.
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Proceeding: Any suit in equity, action at law or other judicial or
administrative proceeding.
Rating Agency Condition: With respect to any action to which a Rating
Agency Condition applies, that each Rating Agency shall have been given 10 days
(or such shorter period as is acceptable to each Rating Agency) prior notice
thereof and that each of the Rating Agencies shall have notified the Depositor,
[the Master Servicer,] the Servicer, [the Note Insurer] and the Issuer in
writing that such action will not result in a reduction or withdrawal of the
then current rating of the Notes.
Redemption Date: In the case of a redemption of the Notes pursuant to
Section 10.01 hereof, the Payment Date specified by the Indenture Trustee
pursuant to such Section 10.01.
Registered Holder: The Person in whose name a Note is registered on the
Note Register on the applicable Record Date.
Sale and Collection Agreement: The Sale and Collection Agreement dated
as of [ ], among the Issuer, the Depositor in its capacity as Seller, the
Indenture Trustee and the Administrator.
Servicing Agreement: Each Servicing Agreement among a Servicer and
[ ], attached as an exhibit to the Sale and Collection Agreement.
Trust Agreement: The Deposit Trust agreement dated as of [ ],
between the Depositor and [ ], as Owner Trustee.
Trust Indenture Act or TIA: The Trust Indenture Act of 1939 as in force
on the date hereof, unless otherwise specifically provided.
Voting Interests: With respect to any Class of Notes, the percentage
equal to the product of (i) [_]% and (ii) a fraction, the numerator of which is
equal to the Class Principal Amount of such Class of Notes and the denominator
of which is equal to the aggregate Class Principal Amount of all Classes of
Notes Outstanding.
(b) Except as otherwise specified herein or as the context may otherwise
require, capitalized terms used but not otherwise defined herein have the
respective meanings set forth in the Sale and Collection Agreement for all
purposes of this Indenture.
Section 1.02. Incorporation by Reference of Trust Indenture Act.
(a) Whenever this Indenture refers to a provision of 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.
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"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.
(b) All other TIA terms used in this Indenture that are defined in the
TIA, defined by TIA reference to another statute or defined by rule of the
Securities and Exchange Commission have the respective meanings assigned to them
by such definitions.
Section 1.03. Rules of Construction.
Unless the context otherwise requires:
(a) a term has the meaning assigned to it;
(b) an accounting term not otherwise defined has the meaning assigned to
it in accordance with generally accepted accounting principles as in effect in
the United States from time to time;
(c) "or" is not exclusive;
(d) "including" means including without limitation;
(e) words in the singular include the plural and words in the plural
include the singular; and
(f) any agreement, instrument or statute defined or referred to herein
or in any instrument or certificate delivered in connection herewith means such
agreement, instrument or statute as from time to time amended, modified or
supplemented (as provided in such agreements) and includes (in the case of
agreements or instruments) references to all attachments thereto and instruments
incorporated therein; references to a Person are also to its permitted
successors and assigns.
ARTICLE II
THE NOTES
Section 2.01. Form.
The Notes shall be designated as the "Aegis Asset Backed Securities
Corporation [ ] Trust [ ] [Asset Backed] Notes, Series [ ]."
Each Class of Notes shall be in substantially the form set forth in Exhibit A
hereto, 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 thereof. 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.
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The Notes shall be typewritten, printed, lithographed or engraved or
produced by any combination of these methods, all as determined by the officers
executing such Notes, as evidenced by their execution of such Notes.
Each Note shall be dated the date of its authentication. The terms of
the Notes are set forth in Exhibit A hereto. The terms of each Class of Notes
are part of the terms of this Indenture.
Section 2.02. Execution, Authentication, Delivery and Dating.
The Notes shall be executed on behalf of the Issuer by an Authorized
Officer of the Owner Trustee or the Administrator. The signature of any such
Authorized Officer on the Notes may be manual or facsimile. Notes bearing the
manual or facsimile signature of individuals who were at any time Authorized
Officers of the Owner Trustee or the Administrator shall bind the Issuer,
notwithstanding that such individuals or any of them have ceased to hold such
offices prior to the authentication and delivery of such Notes or did not hold
such offices at the date of such Notes. Subject to the satisfaction of the
conditions set forth in Section 2.08 hereof, the Indenture Trustee shall, upon
Issuer Order, authenticate and deliver the Notes for original issue in the
aggregate principal amounts with respect to each Class as specified below:
Class Class Principal Amount
----- ----------------------
[ ] $[ ]
The aggregate principal amounts of such Classes of Notes outstanding at
any time may not exceed such respective amounts.
The Notes that are authenticated and delivered by the Indenture Trustee
to or upon the order of the Issuer on the Closing Date shall be dated the
Closing Date. All other Notes that are authenticated after the Closing Date for
any other purpose under the Indenture shall be dated the date of their
authentication. The Notes shall be issuable as registered Notes in the minimum
denomination of [$100,000] and 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 or the Note Registrar 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.
Section 2.03. Registration; Registration of Transfer and Exchange.
The Issuer shall cause to be kept a register (the "Note Register") in
which, subject to such reasonable regulations as it may prescribe, the Issuer
shall provide for the registration of Notes and the registration of transfers of
Notes. [ ] initially shall be the "Note Registrar" for the purpose of
registering Notes and transfers of Notes as herein provided. Upon any
resignation of any Note Registrar, the Issuer shall promptly appoint a successor
or, if it elects not to make such an appointment, assume the duties of Note
Registrar.
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If a Person other than the Indenture Trustee or [ ] is
appointed by the Issuer as Note Registrar, the Issuer will give the Indenture
Trustee [and the Note Insurer] prompt written notice of the appointment of such
Note Registrar and of the location, and any change in the location, of the Note
Register, and the Indenture Trustee [and the Note Insurer] shall have the right
to inspect the Note Register at all reasonable times and to obtain copies
thereof, and the Indenture Trustee [and the Note Insurer] shall have the right
to rely upon a certificate executed on behalf of the Note Registrar by an
Executive Officer thereof as to the names and addresses of the Holders of the
Notes and the principal amounts (or notional amounts) and number of such Notes.
Upon surrender for registration of transfer of any Note at the office or
agency of the Issuer to be maintained as provided in Section 3.02 hereof, the
Issuer shall execute, and the Indenture Trustee or the Note Registrar shall
authenticate and the Noteholder shall be entitled to obtain from the Indenture
Trustee or the Note Registrar, in the name of the designated transferee or
transferees, one or more new Notes of the same Class in any authorized
denominations, of a like aggregate principal amount (or notional amount).
At the option of the Holder, Notes may be exchanged for other Notes of
the same Class in any authorized denominations, of a like aggregate principal
amount (or notional amount), upon surrender of the Notes to be exchanged at such
office or agency. Whenever any Notes are so surrendered for exchange, the Issuer
shall execute, and the Indenture Trustee or the Note Registrar shall
authenticate and the Noteholder shall be entitled to obtain from the Indenture
Trustee or the Note Registrar, the Notes which the Noteholder making the
exchange is entitled to receive.
All Notes issued upon any registration of transfer or exchange of Notes
shall be the valid obligations of the Issuer, evidencing the same debt, and
entitled to the same benefits under this Indenture, as the Notes surrendered
upon such registration of transfer or exchange.
Every Note presented or surrendered for registration of transfer or
exchange shall be duly endorsed by, or be accompanied by a written instrument of
transfer in form satisfactory to the Indenture Trustee duly executed by, the
Holder thereof or such Holder's attorney duly authorized in writing, with such
signature guaranteed by an "eligible guarantor institution" meeting the
requirements of the Note Registrar, which requirements include membership or
participation in the Securities Transfer Agents' 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 Exchange Act.
No service charge shall be made to a Holder [or the Note Insurer] for
any registration of transfer or exchange of Notes, but the Issuer may require
payment of a sum sufficient to cover any tax or other governmental charge that
may be imposed in connection with any registration of transfer or exchange of
Notes, other than exchanges pursuant to Sections 2.04 and 9.06 hereof not
involving any transfer.
The preceding provisions of this Section notwithstanding, the Issuer
shall not be required to make, and the Note Registrar need not register,
transfers or exchanges of Notes selected for
9
redemption or of any Note for a period of 15 days preceding the due date for any
payment with respect to such Note.
Section 2.04. Mutilated, Destroyed, Lost or Stolen Notes.
If (i) any mutilated Note is surrendered to the Indenture Trustee, or
the Indenture Trustee receives evidence to its satisfaction of the destruction,
loss or theft of any Note, and (ii) there is delivered to the Indenture Trustee
[and the Note Insurer] such security or indemnity as may reasonably be required
by it to hold the Issuer, [the Note Insurer] and the Indenture Trustee harmless,
then, in the absence of notice to the Issuer, the Note Registrar, [the Note
Insurer] or the Indenture Trustee that such Note has been acquired by a bona
fide purchaser, an Authorized Officer of the Owner Trustee or the Administrator
on behalf of the Issuer shall execute, and upon its 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 of the same Class;
provided, however, that if any such destroyed, lost or stolen Note, but not a
mutilated Note, shall have become or within seven days shall be due and payable,
or shall have been called for redemption, instead of issuing a replacement Note,
the Issuer may pay such destroyed, lost or stolen Note when so due or payable or
upon the Redemption Date without surrender thereof. If, after the delivery of
such replacement Note or payment of a destroyed, lost or stolen Note pursuant to
the proviso to the preceding sentence, a bona fide purchaser of the original
Note in lieu of which such replacement Note was issued presents for payment such
original Note, the Issuer, [the Note Insurer] 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, [the Note Insurer] or the Indenture Trustee
in connection therewith.
Upon the issuance of any replacement Note under this Section, the Issuer
may require the payment by the Holder of such Note, [other than the Note
Insurer], 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 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 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.
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Section 2.05. Persons Deemed Note Owners.
Prior to due presentment for registration of transfer of any Note, the
Issuer, [the Note Insurer], the Indenture Trustee and any agent of the Issuer,
[the Note Insurer] or the Indenture Trustee may treat the Person in whose name
any Note is registered (as of the day of determination) as the Note Owner 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 Note Insurer] the Indenture Trustee or any agent of
the Issuer or the Indenture Trustee shall be affected by notice to the contrary.
Section 2.06. Payment of Principal and Interest; Defaulted Interest.
(a) Each Class of Notes shall accrue interest at the related Interest
Rate, and such interest shall be payable on each Payment Date as specified in
Exhibit A hereto, subject to Section 3.01 hereof. With respect to each
outstanding Class of LIBOR Notes, if any, the Indenture Trustee shall determine
LIBOR for each applicable Accrual Period on the second London Business Day prior
thereto. All interest payments on each Class of Notes shall be made pro rata to
the Noteholders of such Class entitled thereto. Any installment of interest or
principal, if any, payable on any Note that is punctually paid or duly provided
for by the Issuer on the applicable Payment Date shall be paid to the Person in
whose name such Note (or one or more Predecessor Notes) is registered on the
Record Date (or, in the case of payment of Deferred Amounts, to the Person in
whose name such Note was most recently registered, if such Note has previously
been surrendered to the Indenture Trustee for final payment) by check mailed
first-class postage prepaid to such Person's address as it appears on the Note
Register on such Record Date, except that, unless Definitive Notes have been
issued pursuant to Section 2.12 hereof, with respect to Notes registered on the
Record Date in the name of the nominee of the Clearing Agency (initially, such
nominee to be Cede & Co.), payment will be made by wire transfer in immediately
available funds to the account designated by such nominee and except for the
final installment of principal payable with respect to such Note on a Payment
Date or on the applicable Maturity Date for such Class of Notes (and except for
the Termination Price for any Note called for redemption pursuant to Section
10.01) hereof, which shall be payable as provided below. The funds represented
by any such checks returned undelivered shall be held in accordance with Section
3.03 hereof.
(b) The principal of each Note shall be payable in installments on each
Payment Date as provided in the forms of the Notes set forth in Exhibit A
hereto. Notwithstanding the foregoing, the entire unpaid principal amount of the
Notes together with the amount of any Deferred Amounts in respect thereof of a
Class of Notes shall be due and payable, if not previously paid, on the earlier
of (i) the applicable Maturity Date, (ii) the Redemption Date or (iii) the date
on which an Event of Default shall have occurred and be continuing, if the
Indenture Trustee or the Majority Highest Priority Class Noteholders shall have
declared the Notes to be immediately due and payable in the manner provided in
Section 5.02 hereof.
All principal payments on each Class of Notes shall be made pro rata to
the Noteholders of such Class entitled thereto. The Indenture Trustee shall
notify the Person in whose name a Note is registered at the close of business on
the Record Date preceding the Payment Date on which the Issuer expects that the
final installment of principal of and interest on such Note will be paid. Such
notice shall be mailed or transmitted by facsimile prior to such final Payment
Date and shall specify that such final installment will be payable only upon
presentation and surrender
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of such Note and shall specify the place where such Note may be presented and
surrendered for payment of such installment. [A copy of such form of notice
shall be sent to the Note Insurer by the Indenture Trustee.] Notices in
connection with redemptions of Notes shall be mailed to Noteholders as provided
in Section 10.02 hereof.
Section 2.07. Cancellation.
All Notes surrendered for payment, registration of transfer, exchange or
redemption shall, if surrendered to any Person other than the Indenture Trustee,
be delivered to the Indenture Trustee and shall promptly be cancelled by the
Indenture Trustee. The Issuer may at any time deliver to the Indenture Trustee
for cancellation any Notes previously authenticated and delivered hereunder
which the Issuer may have acquired in any manner whatsoever, and all Notes so
delivered shall promptly be cancelled by the Indenture Trustee. No Notes shall
be authenticated in lieu of or in exchange for any Notes canceled as provided in
this Section, except as expressly permitted by this Indenture. All canceled
Notes may be held or disposed of by the Indenture Trustee in accordance with its
standard retention or disposal policy as in effect at the time unless the Issuer
shall direct by an Issuer Order that they be destroyed or returned to it;
provided, however, that such Issuer Order is timely and the Notes have not been
previously disposed of by the Indenture Trustee.
Section 2.08. Conditions Precedent to the Authentication of the Notes.
The Notes may be authenticated by the Indenture Trustee, upon Issuer
Request and upon receipt by the Indenture Trustee of the following:
(a) An Issuer Order authorizing the execution and authentication of such
Notes by the Issuer.
(b) All of the items of Collateral that are to be delivered to the
Indenture Trustee or its designee.
(c) [A Certificate of Fair Value certifying as to the value of the
Collateral.]
(d) An executed counterpart of the Trust Agreement.
(e) An Opinion of Counsel addressed to the Indenture Trustee and [the
Note Insurer] to the effect that:
(i) all conditions precedent provided for in this Indenture
relating to the authentication of the Notes have been complied with;
(ii) the Owner Trustee has power and authority to execute,
deliver and perform its obligations under the Trust Agreement;
(iii) the Issuer has been duly formed, is validly existing as
a business trust under the laws of the State of Delaware, 12 Del. C.
Section 3801 et seq., and has power, authority and legal right to
execute and deliver this Indenture, the Administration
12
Agreement, [the Custodial Agreement, the Insurance Agreement] and the
Sale and Collection Agreement;
(iv) this Indenture creates a valid security interest in
favor of the Indenture Trustee, for the benefit of the Noteholders [and
the Note Insurer], in the Issuer's right, title and interest in and to
the Mortgage Loans securing the obligations of the Issuer hereunder;
(v) the Notes have been duly authorized by the Issuer and,
when duly executed and delivered by the Owner Trustee, on behalf of the
Issuer, and authenticated by the Indenture Trustee in accordance with
the terms of this Indenture and delivered and paid for, will be validly
issued and outstanding and entitled to the benefits and security
provided for by this Indenture and will constitute the legal, valid and
binding obligations of the Issuer, enforceable in accordance with their
terms, subject to bankruptcy, insolvency, reorganization, moratorium or
other similar laws affecting creditors' rights generally and to general
principles of equity regardless of whether enforcement is sought in a
proceeding in equity or at law;
(vi) this Indenture has been duly qualified under the Trust
Indenture Act;
(vii) no authorization, approval or consent of any
governmental body having jurisdiction in the premises which has not been
obtained by the Issuer is required to be obtained by the Issuer for the
valid issuance and delivery of the Notes, except that no opinion need be
expressed with respect to any such authorizations, approvals or consents
as may be required under any state securities or "blue sky" laws; and
(viii) any other matters as the Indenture Trustee may
reasonably request.
(f) An Officer's Certificate complying with the requirements of
Section 11.01 hereof and stating that:
(i) the Issuer is not in Default under this Indenture and
the issuance of the Notes will not result in any breach of any of the
terms, conditions or provisions of, or constitute a default under, the
Trust Agreement, any indenture, mortgage, deed of trust or other
agreement or instrument to which the Issuer is a party or by which it is
bound, or any order of any court or administrative agency entered in any
Proceeding to which the Issuer is a party or by which it may be bound or
to which it may be subject, and that all conditions precedent provided
in this Indenture relating to the authentication and delivery of the
Notes applied for have been complied with;
(ii) the Issuer is the owner of all of the Mortgage Loans,
has not, other than pursuant to this Indenture, assigned any interest or
participation in the Mortgage Loans (or, if any such interest or
participation has been assigned, it has been released) and has the right
to Grant all of the Mortgage Loans to the Indenture Trustee;
(iii) the Issuer has Granted to the Indenture Trustee all of
its right, title and interest in and to the Collateral, and has
delivered or caused the same to be delivered to the Indenture Trustee;
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(iv) attached thereto are true and correct copies of letters
signed by each Rating Agency confirming that each of the Notes have been
rated "[ ]" or the equivalent by each Rating Agency; and
(v) all conditions precedent provided for in this Indenture
relating to the authentication of the Notes have been complied with.
(g) The Opinions of Counsel to be delivered pursuant to subsection (d)
above may differ from the Opinions of Counsel described in such subsection so
long as such Opinions of Counsel so delivered are acceptable to [the Note
Insurer], each Rating Agency and the Indenture Trustee, which shall be
conclusively evidenced by the delivery on the Closing Date of [the Note
Insurance Policy and of] each such Rating Agency's rating letter and by the
Indenture Trustee's authentication and delivery of the Notes, respectively, and
such acceptable opinions shall be deemed to be the Opinions of Counsel required
pursuant to subsection (d) above
Section 2.09. Release of Collateral.
(a) Except as otherwise provided in subsections (b) and (c) of this
Section, Section 11.01 hereof and the terms of the [[Basic Documents]], the
Indenture Trustee shall release property from the lien of this Indenture only
upon receipt by it [and the Note Insurer] of an Issuer Request accompanied by an
Officer's Certificate, an Opinion of Counsel, certificates in accordance with
TIA Sections 3.14(c) and (d)(1), and Independent Certificates in accordance with
TIA Sections 314(c) and 314(d)(1) or an Opinion of Counsel in lieu of such
Independent Certificates to the effect that the TIA does not require any such
Independent Certificates; provided that no such Independent Certificates or
Opinion of Counsel in lieu of such Independent Certificates shall be necessary
in respect of property released from the lien of the Indenture in accordance
with the provisions hereof if such property consists solely of cash. [The
Indenture Trustee shall surrender the Note Insurance Policy upon satisfaction of
the conditions in Section 4.01.]
(b) The [Master Servicer or the] Servicer, on behalf of the Issuer,
shall be entitled to obtain a release from the lien of this Indenture for any
Mortgage Loan and the related Mortgaged Property at any time (i) after a payment
by the Seller or the Issuer of the Loan Purchase Price of the Mortgage Loan,
(ii) after a Qualified Substitute Mortgage Loan is substituted for such Mortgage
Loan and payment of the Substitution Adjustment, if any, (iii) after liquidation
of the Mortgage Loan in accordance with the Servicing Agreement and the deposit
of all net recoveries thereon in the Collection Account or (iv) upon the
termination of a Mortgage Loan (due to, among other causes, a prepayment in full
of the Mortgage Loan and sale or other disposition of the related Mortgaged
Property. Any such release other than as contemplated by the preceding sentence
shall be subject to the condition that the Issuer shall have delivered to the
Indenture Trustee and [the Note Insurer] an Issuer Request (A) identifying the
Mortgage Loan and the related Mortgaged Property to be released, (B) requesting
the release thereof, (C) setting forth the amount deposited in the Collection
Account with respect thereto, and (D) certifying that the amount deposited in
the Collection Account (x) equals the Loan Purchase Price of the Mortgage Loan,
in the event a Mortgage Loan and the related Mortgaged Property are being
released from the lien of this Indenture pursuant to item (i) above, (y) equals
the Substitution Adjustment related to the Qualified Substitute Mortgage Loan
and the Deleted Mortgage Loan released from the lien of the Indenture pursuant
to item (ii) above, or (z) equals the entire amount of net
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recoveries received with respect to such Mortgage Loan and the related Mortgaged
Property in the event of a release from the lien of this Indenture pursuant to
items (iii) or (iv) above.
(c) The Indenture Trustee shall, if requested by the [Master Servicer or
the] Servicer, temporarily release or cause the Custodian temporarily to release
to the [Master Servicer or the] Servicer the Mortgage File pursuant to the
provisions of the Servicing Agreement upon compliance by the [Master Servicer or
the] Servicer with the provisions thereof; provided, however, that the Mortgage
File shall have been stamped to signify the Issuer's pledge to the Indenture
Trustee under the Indenture.
Section 2.10. Book-Entry Notes.
The Notes, when authorized by an Issuer Order, will be issued in the
form of typewritten Notes representing the Book-Entry Notes, to be delivered to
The Depository Trust Company, the initial Clearing Agency, by or on behalf of
the Issuer. The Book-Entry Notes shall be registered initially on the Note
Register in the name of Cede & Co., the nominee of the initial Clearing Agency,
and no Note Owner will receive a definitive Note representing such Note Owner's
interest in such Note, except as provided in Section 2.12 hereof. Unless and
until definitive, fully registered Notes (the "Definitive Notes") have been
issued to such Note Owners pursuant to Section 2.12 hereof:
(a) the provisions of this Section shall be in full force and effect;
(b) the Note Registrar and the Indenture Trustee shall be entitled to
deal with the Clearing Agency 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 Note Owners;
(c) to the extent that the provisions of this Section conflict with any
other provisions of this Indenture, the provisions of this Section shall
control;
(d) the rights of Note Owners shall be exercised only through the
Clearing Agency and shall be limited to those established by law and agreements
between such Note Owners and the Clearing Agency and/or the Clearing Agency
Participants pursuant to the Note Depository Agreement. Unless and until
Definitive Notes are issued pursuant to Section 2.12 hereof, the initial
Clearing Agency will make book-entry transfers among the Clearing Agency
Participants and receive and transmit payments of principal of and interest on
the Notes to such Clearing Agency Participants; and
(e) 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 Voting Interests of the Outstanding Notes, the Clearing Agency
shall be deemed to represent such percentage only to the extent that it has
received instructions to such effect from Note Owners and/or Clearing Agency
Participants owning or representing, respectively, such required percentage of
the beneficial interest in the Notes and has delivered such instructions to the
Indenture Trustee.
15
Section 2.11. Notices to Clearing Agency.
Whenever a notice or other communication to the Noteholders is required
under this Indenture, unless and until Definitive Notes shall have been issued
to such Note Owners pursuant to Section 2.12 hereof, the Indenture Trustee shall
give all such notices and communications specified herein to be given to Holders
of the Notes to the Clearing Agency and shall have no obligation to such Note
Owners.
Section 2.12. Definitive Notes.
If (i) the Issuer advises the Indenture Trustee in writing that the
Clearing Agency is no longer willing or able to properly discharge its
responsibilities with respect to the Book-Entry Notes and the Administrator is
unable to locate a qualified successor, (ii) the Issuer at its option advises
the Indenture Trustee in writing that it elects to terminate the book-entry
system through the Clearing Agency or (iii) after the occurrence of an Event of
Default, Owners of the Book- Entry Notes representing beneficial interests
aggregating at least a majority of the Voting Interests of the Outstanding Notes
advise the Clearing Agency in writing that the continuation of a book-entry
system through the Clearing Agency is no longer in the best interests of such
Note Owners, then the Clearing Agency shall notify all Note Owners and the
Indenture Trustee of the occurrence of such event and of the availability of
Definitive Notes to Note Owners requesting the same. Upon surrender to the
Indenture Trustee of the typewritten Notes representing the Book-Entry Notes by
the Clearing Agency, accompanied by registration instructions, the Issuer shall
execute and the Indenture Trustee shall authenticate the Definitive Notes in
accordance with the instructions of the Clearing Agency. None of the Issuer,
[the Note Insurer], the Note Registrar or the Indenture Trustee shall be liable
for any delay in delivery of such instructions and each of them 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 2.13. Tax Treatment.
The Issuer has entered into this Indenture, and the Notes will be
issued, with the intention that for all purposes, including federal, state and
local income, single business and franchise tax purposes, the Notes will qualify
as indebtedness of the Issuer secured by the Collateral. The Issuer, by entering
into this Indenture, and each Noteholder, by its acceptance of a Note (and each
Note Owner by its acceptance of an interest in the applicable Book-Entry Note),
agree to treat the Notes for all purposes, including federal, state and local
income, single business and franchise tax purposes, as indebtedness of the
Issuer.
ARTICLE III
COVENANTS
Section 3.01. Payment of Principal and Interest.
The Issuer will duly and punctually pay (or will cause to be paid duly
and punctually) the principal of and interest on the Notes in accordance with
the terms of the Notes and this Indenture. Without limiting the foregoing,
unless the Notes have been declared due and payable pursuant to Section 5.02 and
monies collected by the Indenture Trustee are being applied in accordance with
Section 5.04(b), subject to and in accordance with Section 8.02(c) hereof, the
16
Issuer will cause to be distributed all amounts on deposit in the Note Payment
Account on each Payment Date deposited therein pursuant to the Sale and
Collection Agreement (i) for the benefit of the Notes of each Class, to the
Holders thereof. Amounts properly withheld under the Code by any Person from a
payment to any Noteholder of interest and/or principal shall be considered as
having been paid by the Issuer to such Noteholder for all purposes of this
Indenture.
The Notes shall be non-recourse obligations of the Issuer and shall be
limited in right of payment to amounts available from the Collateral [and any
amounts received by the Indenture Trustee under the Note Insurance Policy in
respect of the Notes], as provided in this Indenture. The Issuer shall not
otherwise be liable for payments on the Notes. If any other provision of this
Indenture shall be deemed to conflict with the provisions of this Section 3.01,
the provisions of this Section 3.01 shall control.
Section 3.02. Maintenance of Office or Agency.
The Issuer will or will cause the Administrator to maintain in [ ]
an office or agency where Notes may be surrendered for registration of transfer
or exchange and where notices and demands to or upon the Issuer in respect of
the Notes and this Indenture may be served. The Issuer hereby initially appoints
the Administrator to serve as its agent for the foregoing purposes and to serve
as Paying Agent with respect to the Notes. The Issuer will give prompt written
notice to the Indenture Trustee of the location, and of any change in the
location, of any such office or agency. 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.
As provided in Section 8.02(a) and (b) hereof, all payments of amounts
due and payable with respect to any Notes that are to be made from amounts
withdrawn from the Collection Account and the Note Payment Account pursuant to
Section 8.02(c) hereof shall be made on behalf of the Issuer by the Indenture
Trustee or by the Paying Agent, and no amounts so withdrawn from the Collection
Account and the Note Payment Account for payments of Notes shall be paid over to
the Issuer except as provided in this Section.
On or before the Business Day preceding each Payment Date and the
Redemption Date, the Paying Agent shall deposit or cause to be deposited in the
Note Payment Account an aggregate sum sufficient to pay the amounts due on such
Payment Date or the Redemption Date under the Notes, such sum to be held in
trust for the benefit of the Persons entitled thereto, and (unless the Paying
Agent is the Indenture Trustee) shall promptly notify the Indenture Trustee of
its action or failure so to act.
Any Paying Agent shall be appointed by Issuer Order with written notice
thereof to the Indenture Trustee [and the Note Insurer]. Any Paying Agent
appointed by the Issuer shall be a Person which would be eligible to be
Indenture Trustee hereunder as provided in Section 6.11 hereof. The Issuer shall
not appoint any Paying Agent (other than the Indenture Trustee) which is not, at
the time of such appointment, a Depository Institution.
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The Issuer will cause each Paying Agent other than the Administrator to
execute and deliver to the Indenture Trustee [and the Note Insurer] 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, that such Paying Agent will:
(a) 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;
(b) give the Indenture Trustee [and the Note Insurer] notice of any
default by the Issuer (or any other obligor upon the Notes) of which it has
actual knowledge in the making of any payment required to be made with respect
to the Notes;
(c) 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;
(d) immediately resign as a Paying Agent and forthwith pay to the
Indenture Trustee all sums held by it in trust for the payment of Notes if at
any time it ceases to meet the standards required to be met by a Paying Agent at
the time of its appointment; and
(e) comply with all requirements of the Code with respect to the
withholding from any payments made by it on any Notes of any applicable
withholding taxes imposed thereon and with respect to any applicable reporting
requirements in connection therewith; provided, however, that with respect to
withholding and reporting requirements applicable to original issue discount,
the accrual of market discount or the amortization of premiums (if any) on the
Notes, the Issuer shall have first provided the calculations pertaining thereto
to the Indenture Trustee.
The Issuer may at any time, for the purpose of obtaining the
satisfaction and discharge of this Indenture or for any other purpose, by Issuer
Order direct any Paying Agent to pay to the Indenture Trustee all sums held in
trust by such Paying Agent, such sums to be held by the Indenture Trustee upon
the same trusts as those upon which the sums were held by such Paying Agent; and
upon such payment by any Paying Agent to the Indenture Trustee, such Paying
Agent shall be released from all further liability with respect to such money.
Subject to applicable laws with respect to escheat of funds or abandoned
property, any money held by the Indenture Trustee or any Paying Agent in trust
for the payment of any amount due with respect to any Note and remaining
unclaimed for two years after such amount has become due and payable shall be
discharged from such trust and be paid to the Issuer on Issuer Request; and the
Holder of such Note shall thereafter, as an unsecured general creditor, look
only to the Issuer for payment thereof (but only to the extent of the amounts so
paid to the Issuer), and all liability of the Indenture Trustee or such Paying
Agent with respect to such trust money shall thereupon cease; provided, however,
that the Indenture Trustee or such Paying Agent, before being required to make
any such repayment, shall at the expense and direction of the Issuer cause to be
published, once in a newspaper of general circulation in The City of [ ]
customarily published in the English language on each Business Day, notice that
such money
18
remains unclaimed and that, after a date specified therein, which shall not be
less than 30 days from the date of such publication, any unclaimed balance of
such money then remaining will be repaid to the Issuer. The Indenture Trustee
shall also adopt and employ, at the expense and direction of the Issuer, any
other reasonable means of notification of such repayment (including, but not
limited to, mailing notice of such repayment to Holders whose Notes have been
called but have not been surrendered for redemption or whose right to or
interest in moneys due and payable but not claimed 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.
(a) Subject to subparagraph (b) of this Section 3.04, the Issuer will
keep in full effect its existence, rights and franchises as a business trust
under the laws of the State of [Delaware] [(unless subject to the prior written
consent of the Note Insurer 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 Collateral and each other
instrument or agreement included in the Collateral.
(b) Any successor to the Owner Trustee appointed pursuant to [Section
10.02] of the Trust Agreement shall be the successor Owner Trustee under this
Indenture without the execution or filing of any paper, instrument or further
act to be done on the part of the parties hereto.
(c) Upon any consolidation or merger of or other succession to the Owner
Trustee, the Person succeeding to the Owner Trustee under the Trust Agreement
may exercise every right and power of the Owner Trustee under this Indenture
with the same effect as if such Person had been named as the Owner Trustee
herein.
Section 3.05. Protection of Collateral.
The Issuer will from time to time [or upon the direction of the Note
Insurer] 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:
(a) provide further assurance with respect to the Grant of all or any
portion of the Collateral;
(b) maintain or preserve the lien and security interest (and the
priority thereof) of this Indenture or carry out more effectively the purposes
hereof;
(c) perfect, publish notice of or protect the validity of any Grant made
or to be made by this Indenture;
(d) enforce any rights with respect to the Collateral; or
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(e) preserve and defend title to the Collateral and the rights of the
Indenture Trustee, the Noteholders [and the Note Insurer] in such Collateral
against the claims of all persons and parties.
The Issuer hereby designates the Administrator, its agent and
attorney-in-fact, to execute any financing statement, continuation statement or
other instrument required to be executed pursuant to this Section 3.05.
Section 3.06. Annual Opinions as to Collateral.
On or before March 15th in each calendar year, beginning in [ ], the
Issuer shall furnish to the Indenture Trustee [and the Note Insurer] an Opinion
of Counsel either stating that, in the opinion of such counsel, such action has
been taken with respect to the recording, filing, re-recording 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 created by this Indenture 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 of this Indenture until [ ] of the
following calendar year.
Section 3.07. Performance of Obligations; Servicing of Mortgage Loans.
(a) The Issuer will not take any action and will use its best efforts
not to permit any action to be taken by others that would release any Person
from any of such Person's material covenants or obligations under any instrument
or agreement included in the Collateral or that would result in the amendment,
hypothecation, subordination, termination or discharge of, or impair the
validity or effectiveness of, any such instrument or agreement, except as
expressly provided in this Indenture, the Sale and Collection Agreement or such
other instrument or agreement.
(b) The Issuer may contract with or otherwise obtain the assistance of
other Persons (including, without limitation, the Administrator under the
Administration Agreement) to assist it in performing its duties under this
Indenture, and any performance of such duties by a Person identified to the
Indenture Trustee [and the Note Insurer] in an Officer's Certificate of the
Issuer shall be deemed to be action taken by the Issuer. Initially, the Issuer
has contracted with the Administrator to assist the Issuer in performing its
duties under this Indenture. Notwithstanding anything to the contrary herein,
the Issuer shall in all respects remain liable for its obligations hereunder and
under the Basic Documents.
(c) The Issuer will punctually perform and observe all of its
obligations and agreements contained in this Indenture, in the Basic Documents
and in the instruments and agreements included in the Collateral, including but
not limited to (i) filing or causing to be filed all UCC financing statements
and continuation statements required to be filed by the terms of this
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Indenture and the Sale and Collection Agreement and (ii) recording or causing to
be recorded all Mortgages, Assignments of Mortgage, all intervening Assignments
of Mortgage and all assumption and modification agreements required to be
recorded by the terms of the Sale and Collection Agreement, in accordance with
and within the time periods provided for in this Indenture and/or the Sale and
Collection Agreement, as applicable. Except as otherwise expressly provided
therein, the Issuer shall not waive, amend, modify, supplement or terminate any
Basic Document or any provision thereof without the consent of the Indenture
Trustee, [the Note Insurer] and the Holders of at least a majority of the Voting
Interests of the Outstanding Notes.
(d) If the Issuer shall have knowledge of the occurrence of an Event of
Default under the Sale and Collection Agreement, the Issuer shall promptly
notify the Indenture Trustee, [the Note Insurer] and the Rating Agencies
thereof, and shall specify in such notice the action, if any, the Issuer is
taking with respect to such default.
(e) Without derogating from the absolute nature of the assignment
granted to the Indenture Trustee under this Indenture or the rights of the
Indenture Trustee hereunder, the Issuer agrees (i) that it will not, without the
prior written consent of the Indenture Trustee [and the Note Insurer unless a
Note Insurer Default has occurred and is continuing,] amend, modify, waive,
supplement, terminate or surrender, or agree to any amendment, modification,
supplement, termination, waiver or surrender of, the terms of any Collateral
(except to the extent otherwise provided in the Sale and Collection Agreement)
or the Basic Documents, or waive timely performance or observance by the
Depositor under the Sale and Collection Agreement; and (ii) that any such
amendment shall not (A) increase or reduce in any manner the amount of, or
accelerate or delay the timing of, distributions that are required to be made
for the benefit of the Noteholders or (B) reduce the aforesaid percentage of the
Notes that is required to consent to any such amendment, without the consent of
the Holders the Voting Interests of all Outstanding Notes. If any such
amendment, modification, supplement or waiver shall so be consented to by the
Indenture Trustee [and the Note Insurer unless a Note Insurer Default has
occurred and is continuing,] the Issuer agrees, promptly following a request by
the Indenture Trustee [or the Note Insurer] to do so, to execute and deliver, in
its own name and at its own expense, such agreements, instruments, consents and
other documents as the Indenture Trustee [or the Note Insurer] may deem
necessary or appropriate in the circumstances.
Section 3.08. Negative Covenants.
So long as any Notes are Outstanding, the Issuer shall not:
(a) except as expressly permitted by this Indenture, the Mortgage Loan
Sale Agreement or the Sale and Collection Agreement, sell, transfer, exchange or
otherwise dispose of any of the properties or assets of the Issuer, including
those included in the Collateral, unless directed to do so by the Indenture
Trustee or [the Note Insurer];
(b) claim any credit on, or make any deduction from the principal or
interest payable in respect of, the Notes (other than amounts properly withheld
from such payments under the Code) or assert any claim against any present or
former Noteholder by reason of the payment of the taxes levied or assessed upon
any part of the Collateral;
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(c) engage in any business or activity other than as permitted by the
Trust Agreement or other than in connection with, or relating to, the issuance
of Notes pursuant to this Indenture, or amend the Trust Agreement as in effect
on the Closing Date other than in accordance with [Section 11.01] thereof;
(d) issue debt obligations under any other indenture;
(e) incur or assume any indebtedness or guaranty any indebtedness of any
Person, except for such indebtedness as may be incurred by the Issuer in
connection with the issuance of the Notes pursuant to this Indenture;
(f) dissolve or liquidate in whole or in part or merge or consolidate
with any other Person;
(g) (A) permit the validity or effectiveness of this Indenture to be
impaired, or permit the lien of this Indenture to be amended, hypothecated,
subordinated, terminated or discharged, or permit any Person to be released from
any covenants or obligations with respect to the Notes under this Indenture
except as may expressly be permitted hereby, (B) permit any lien, charge,
excise, claim, security interest, mortgage or other encumbrance (other than the
lien of this Indenture) to be created on or extend to or otherwise arise upon or
burden the Collateral or any part thereof or any interest therein or the
proceeds thereof (other than tax liens, mechanics' liens and other liens that
arise by operation of law, in each case on any of the Mortgaged Properties and
arising solely as a result of an action or omission of the related Obligors) or
(C) permit the lien of this Indenture not to constitute a valid first priority
(other than with respect to any such tax, mechanics' or other lien) security
interest in the Collateral;
(h) remove the Administrator without cause unless the Rating Agency
Condition shall have been satisfied in connection with such removal [and the
Note Insurer shall have given its prior written consent];
(i) take any other action or fail to take any action which may cause the
Issuer to be taxable as (a) an association pursuant to Section 7701 of the Code
and the corresponding regulations or (b) as a taxable mortgage pool pursuant to
Section 7701(i) of the Code and the corresponding regulations; or
(j) made any expenditure by long-term or operating lease or otherwise
for capital assets (either realty or personalty).
Section 3.09. Annual Statement as to Compliance.
The Issuer will deliver to the Indenture Trustee [and the Note Insurer],
within 120 days after the end of each fiscal year of the Issuer (commencing in
the fiscal year [ ]), an Officer's Certificate stating, as to the Authorized
Officer signing such Officer's Certificate, that:
(a) a review of the activities of the Issuer during such year and of its
performance under this Indenture has been made under such Authorized Officer's
supervision; and
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(b) to the best of such Authorized Officer's knowledge, based on such
review, the Issuer has complied with all conditions and covenants under this
Indenture throughout such year, or, if there has been a default in its
compliance with any such condition or covenant, specifying each such default
known to such Authorized Officer and the nature and status thereof.
Section 3.10. Covenants of the Issuer.
All covenants of the Issuer in this Indenture are covenants of the
Issuer and are not covenants of the Owner Trustee. The Owner Trustee is, and any
successor Owner Trustee under the Trust Agreement will be, entering into this
Indenture solely as Owner Trustee under the Trust Agreement and not in its
respective individual capacity, and in no case whatsoever shall the Owner
Trustee or any such successor Owner Trustee be personally liable on, or for any
loss in respect of, any of the statements, representations, warranties or
obligations of the Issuer hereunder, as to all of which the parties hereto agree
to look solely to the property of the Issuer.
Section 3.11. Servicers' Obligations.
The Issuer shall cause each Servicer to company with the related
Servicing Agreement.
Section 3.12. Restricted Payments.
The Issuer shall not, directly or indirectly, (i) pay any dividend or
make any distribution (by reduction of capital or otherwise), whether in cash,
property, securities or a combination thereof, to the Owner Trustee or any owner
of a beneficial interest in the Issuer or otherwise with respect to any
ownership or equity interest or security in or of the Issuer, (ii) redeem,
purchase, retire or otherwise acquire for value any such ownership or equity
interest or security or (iii) set aside or otherwise segregate any amounts for
any such purpose; provided, however, that the Issuer may make, or cause to be
made, (x) distributions to the Indenture Trustee, the Owner Trustee and the
Securityholders as contemplated by, and to the extent funds are available for
such purpose under, the Sale and Collection Agreement, the Indenture or the
Trust Agreement and (y) payments to the Indenture Trustee pursuant to the
Administration Agreement. The Issuer will not, directly or indirectly, make or
cause to be made payments to or distributions from the Note Payment Account, the
Collection Account except in accordance with this Indenture and the Basic
Documents.
Section 3.13. Issuer May Consolidate, etc., Only on Certain Terms.
(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 and shall expressly assume,
by an indenture supplemental hereto, executed and delivered to the
Indenture Trustee [and the Note Insurer], in form satisfactory to the
Indenture Trustee [and the Note Insurer], 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;
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(ii) immediately after giving effect to such transaction, no
Default or Event of Default shall have occurred and be continuing;
(iii) the Rating Agency Condition shall have been satisfied
with respect to such transaction;
(iv) the Issuer shall have received an Opinion of Counsel
(and shall have delivered copies thereof to the Indenture Trustee [and
the Note Insurer]) 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;
(vi) the Issuer shall have delivered to the Indenture Trustee
and [the Note Insurer], 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); and
(vii) [the Note Insurer shall have given its prior written
consent.]
(b) The Issuer shall not convey or transfer any of its properties or
assets, including those included in the Trust Estate, to any Person other than
in accordance with the Basic Documents, 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 (A) shall be a United States citizen or a Person
organized and existing under the United States of America or any State,
(B) expressly assumes, by an indenture supplemental hereto, executed and
delivered to the Indenture Trustee [and the Note Insurer], in form
satisfactory to the Indenture Trustee [and the Note Insurer], 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 agrees 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
[and the Note Insurer], (D) unless otherwise provided in such
supplemental indenture, expressly agrees 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 agrees by means of such supplemental indenture that such
Person (or, if a group of Persons, 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;
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(iii) the Rating Agency Condition shall have been satisfied
with respect to such transaction;
(iv) the Issuer shall have received an Opinion of Counsel
(and shall have delivered copies thereof to the Indenture Trustee [and
the Note Insurer]) 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;
(vi) the Issuer shall have delivered to the Indenture Trustee
[and the Note Insurer] 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); and
(vii) [the Note Insurer has given its prior written consent.]
Section 3.14. Successor or Transferee.
(a) Upon any consolidation or merger of the Issuer in accordance with
Section 3.13(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 3.13(b), the Issuer will be released from every
covenant and agreement of this Indenture to be observed by or performed on the
part of the Issuer with respect to the Notes immediately upon the delivery of
written notice to the Indenture Trustee [and the Note Insurer] stating that the
Issuer is to be so released.
Section 3.15. Treatment of Notes as Debt for Tax Purposes.
The Issuer shall, and shall cause the Administrator to, treat the Notes
as indebtedness for all purposes.
Section 3.16. Notice of Events of Default.
The Issuer shall give the Indenture Trustee, [the Note Insurer] and the
Rating Agencies prompt written notice of each Event of Default hereunder, each
default on the part of the Depositor of its obligations under the Sale and
Collection Agreement, each default on the part of any Servicer under the related
Servicing Agreement and each default on the part of the Seller of its
obligations under the [Mortgage Loan Sale Agreement].
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Section 3.17. Further Instruments and Acts.
Upon request of the Indenture Trustee [or the Note Insurer], 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.
ARTICLE IV
SATISFACTION AND DISCHARGE
Section 4.01. Satisfaction and Discharge of Indenture.
This Indenture shall cease to be of further effect with respect to the
Notes (except as to (i) rights of registration of transfer and exchange, (ii)
substitution of mutilated, destroyed, lost or stolen Notes, (iii) rights of
Noteholders to receive payments of principal thereof and interest thereon, (iv)
Sections 3.03, 3.04, 3.05, 3.08 3.10, 3.12 and 3.16 hereof, (v) the rights,
obligations and immunities of the Indenture Trustee hereunder (including the
rights of the Indenture Trustee under Section 6.07 hereof and the obligations of
the Indenture Trustee under Section 4.02 hereof) and (vi) the rights of
Noteholders as beneficiaries hereof with respect to the property so deposited
with the Indenture Trustee payable to all or any of them), and the Indenture
Trustee, on demand of and at the expense of the Issuer, shall execute proper
instruments acknowledging satisfaction and discharge of this Indenture with
respect to the Notes, when either (I) the Sale and Collection Agreement has been
terminated pursuant to Section 6.01 thereof or (II) all of the following have
occurred:
(a) either
(i) all Notes theretofore authenticated and delivered (other
than (i) Notes that have been destroyed, lost or stolen and that have
been replaced or paid as provided in Section 2.04 hereof and (ii) Notes
for the payment of which money has theretofore been deposited in trust
or segregated and held in trust by the Issuer and thereafter repaid to
the Issuer or discharged from such trust, as provided in Section 3.03
hereof) shall have been delivered to the Indenture Trustee for
cancellation; or
(ii) all Notes not theretofore delivered to the Indenture
Trustee for cancellation
(A) shall have become due and payable, or
(B) will become due and payable within one year of
the Maturity Date (or, if one or more Classes of Notes have
different Maturity Dates, the latest Maturity Date), or
(C) are to be called for redemption within one year
under arrangements satisfactory to the Indenture Trustee for the
giving of notice of redemption by the Indenture Trustee in the
name, and at the expense, of the Issuer,
(D) and the Issuer, in the case of clause (A), (B)
or (C) above, has irrevocably deposited or caused irrevocably to
be deposited with the Indenture
26
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 (including Deferred Amounts to the extent required
to be paid hereunder) not theretofore delivered to the Indenture
Trustee for cancellation when due to the applicable Maturity
Date of such Class of Notes or the Redemption Date (if Notes
shall have been called for redemption pursuant to Section 10.01
hereof), as the case may be; and
(b) the latest of (i) 18 months after payment in full of all outstanding
obligations under the Notes, (ii) the payment in full of all unpaid fees and
expenses of the Trust [and all sums owing to the Note Insurer under the
Insurance Agreement] and (iii) the date on which the Issuer has paid or caused
to be paid all other sums payable hereunder by the Issuer; and
(c) the Issuer shall have delivered to the Indenture Trustee [and the
Note Insurer] an Officer's Certificate, an Opinion of Counsel and (if required
by the TIA or the Indenture Trustee) an Independent Certificate from a firm of
certified public accountants, each meeting the applicable requirements of
Section 11.01(a) hereof and, subject to Section 11.02 hereof, each stating that
all conditions precedent herein provided for, relating to the satisfaction and
discharge of this Indenture with respect to the Notes, have been complied with.
Section 4.02. Application of Trust Money.
All moneys deposited with the Indenture Trustee pursuant to Sections
3.03 and 4.01 hereof shall be held in trust and applied by it, in accordance
with the provisions of the Notes and this Indenture, to the payment, either
directly or through any Paying Agent, as the Indenture Trustee may determine, to
[the Note Insurer and] the Holders of the particular Notes for the payment or
redemption of which such moneys have been deposited with the Indenture Trustee,
of all sums due and to become due thereon for principal and/or interest; but
such moneys need not be segregated from other funds except to the extent
required herein or in the Sale and Collection Agreement or required by law.
Section 4.03. Repayment of Moneys Held by Paying Agent.
In connection with the satisfaction and discharge of this Indenture with
respect to the Notes, all moneys then held by any Paying Agent other than the
Indenture Trustee under the provisions of this Indenture with respect to such
Notes shall, upon demand of the Issuer, be paid to the Indenture Trustee to be
held and applied according to Section 3.03 hereof and thereupon such Paying
Agent shall be released from all further liability with respect to such moneys.
ARTICLE V
REMEDIES
Section 5.01. Events of Default.
(a) "Event of Default," wherever used herein, means any one of the
following events (whatever the reason for such Event of Default and whether it
shall be voluntary or involuntary
27
or be effected by operation of law or pursuant to any judgment, decree or order
of any court or any order, rule or regulation of any administrative or
governmental body):
(i) subject to Section 5.01(b) and notwithstanding that
there may be insufficient sums in the Note Payment Account for payment
thereof on the related Payment Date, default in the payment of any
interest on any Note when the same becomes due and payable, and
continuance of such default for a period of five (5) days; or
(ii) subject to Section 5.01(b) and notwithstanding that
there may be insufficient sums in the Note Payment Account for payment
thereof on the related Payment Date, default in the payment of any
installment of principal when the same becomes due and payable, and
continuance of such default for a period of five (5) days, or of the
entire Principal Amount (including any Deferred Amount to the extent
required to be paid hereunder) of any Note on the applicable Maturity
Date; or
(iii) the existence of an unpaid Deferred Amount in respect of
any Highest Priority Class Notes; or
(iv) default in the observance or performance of any covenant
or agreement of the Issuer made in this Indenture (other than a covenant
or agreement, a default in the observance or performance of which is
elsewhere in this Section specifically dealt with), or any
representation or warranty of the Issuer made in this Indenture, the
Insurance Agreement, the Sale and Collection Agreement or in any
certificate or other writing delivered pursuant hereto or in connection
herewith proving to have been incorrect in any material respect as of
the time when the same shall have been made, and such default shall
continue or not be cured, or the circumstance or condition in respect of
which such misrepresentation or warranty was incorrect shall not have
been eliminated or otherwise cured, for a period of 30 days after there
shall have been given, by registered or certified mail, to the Issuer by
the Indenture Trustee [or the Note Insurer], or to the Issuer and the
Indenture Trustee by the Holders of at least [__]% of the Voting
Interests of the Outstanding Notes, a written notice specifying such
default or incorrect representation or warranty and requiring it to be
remedied and stating that such notice is a notice of Default hereunder;
or
(v) the filing of a decree or order for relief by a court
having jurisdiction in the premises in respect of the Issuer or any
substantial part of the Collateral in an involuntary case under any
applicable federal or state bankruptcy, insolvency or other similar law
now or hereafter in effect, or appointing a receiver, liquidator,
assignee, custodian, trustee, sequestrator or similar official of the
Issuer or for any substantial part of the Collateral, or ordering the
winding-up or liquidation of the Issuer's affairs, and such decree or
order shall remain unstayed and in effect for a period of 60 consecutive
days; or
(vi) the commencement by the Issuer of a voluntary case under
any applicable federal or state bankruptcy, insolvency or other similar
law now or hereafter in effect, or the consent by the Issuer to the
entry of an order for relief in an involuntary case under
28
any such law, or the consent by the Issuer to the appointment or taking
possession by a receiver, liquidator, assignee, custodian, trustee,
sequestrator or similar official of the Issuer or for any substantial
part of the Collateral, or the making by the Issuer of any general
assignment for the benefit of creditors, or the failure by the Issuer
generally to pay its debts as such debts become due, or the taking of
any action by the Issuer in furtherance of any of the foregoing.
(b) The Issuer promptly shall deliver to the Indenture Trustee [and the
Note Insurer], within five days after the occurrence thereof, written notice in
the form of an Officer's Certificate of any event which with the giving of
notice and the lapse of time would become an Event of Default under clauses (iv)
and (v) above, the status of such event 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 may, and at the direction or upon the prior
written consent of [the Note Insurer or] the Majority Highest Priority Class
Noteholders [with the written consent of the Note Insurer] shall, declare all
the Notes to be immediately due and payable, by a notice in writing to the
Issuer (and to the Indenture Trustee if given by Noteholders), and upon any such
declaration the unpaid principal amount of such Notes, together with accrued and
unpaid interest thereon through the date of acceleration, shall become
immediately due and payable.
At any time after such declaration of acceleration of maturity has been
made and before a judgment or decree for payment of the moneys due has been
obtained by the Indenture Trustee as hereinafter in this Article V provided,
[the Note Insurer or] the Majority Highest Priority Class Noteholders [with the
prior written consent of the Note Insurer], by written notice to the Issuer and
the Indenture Trustee, may rescind and annul such declaration and its
consequences if:
(a) the Issuer has paid or deposited with the Indenture Trustee a sum
sufficient to pay:
(i) all payments of principal of and/or interest on all
Highest Priority Class Notes and all other amounts that would then be
due hereunder or upon such Highest Priority Class Notes if the Event of
Default giving rise to such acceleration had not occurred; and
(ii) all sums paid or advanced by the Indenture Trustee
hereunder [plus all amounts due to the Note Insurer under the Basic
Documents] and the reasonable compensation, expenses, disbursements and
advances of each of the Indenture Trustee [and the Note Insurer] and its
agents and counsel; and
(b) all Events of Default, other than the nonpayment of the principal of
the Notes that has become due solely by such acceleration, have been cured or
waived as provided in Section 5.12 hereof.
No such rescission shall affect any subsequent default or impair any
right consequent thereto.
29
The Holders of Notes of a Non-Priority Class shall have no right to
exercise any remedies of Noteholders under this Article V, except to the extent
otherwise expressly provided herein.
Section 5.03. Collection of Indebtedness and Suits for Enforcement by
Indenture Trustee.
(a) The Issuer covenants that if (i) default is made in the payment of
any interest on any Note when the same becomes due and payable, and such default
continues for a period of five (5) days, or (ii) default is made in the payment
of any installment of principal when the same becomes due and payable, and
continuance of such default for a period of five (5) days, or of the Principal
Amount of any Note at the applicable Maturity Date, the Issuer shall, [upon
demand of the Indenture Trustee made at the direction of the Note Insurer], pay
to the Indenture Trustee, for the benefit of the Holders of the Notes [and the
Note Insurer], the whole amount then due and payable on such Notes for principal
and/or interest, with interest upon the overdue principal and, to the extent
payment at such rate of interest shall be legally enforceable, upon overdue
installments of interest at the rate borne by the Notes and in addition thereto
such further amount as shall be sufficient to cover the costs and expenses of
collection, including the reasonable compensation, expenses, disbursements and
advances of the Indenture Trustee [and the Note Insurer] and their respective
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, shall [at the direction of the Note Insurer, and if a Note Insurer
Default has occurred and is continuing,] the Indenture Trustee may, and shall at
the direction of the Majority Highest Priority Class Noteholders, institute a
Proceeding for the collection of the sums so due and unpaid, and may prosecute
such Proceeding to judgment or final decree, and may enforce the same against
the Issuer or other obligor upon such Notes and collect in the manner provided
by law out of the property of the Issuer or other obligor upon such Notes,
wherever situated, the moneys adjudged or decreed to be payable.
(c) If an Event of Default occurs and is continuing, the Indenture
Trustee shall, [at the direction of the Note Insurer, and if a Note Insurer
Default has occurred and is continuing,] the Indenture Trustee may, in its
discretion, and shall, at the direction of the Majority Highest Priority Class
Noteholders, as more particularly provided in Section 5.04, proceed to protect
and enforce its rights and the rights of [the Note Insurer and] the Noteholders
by such appropriate Proceedings as the Indenture Trustee shall deem most
effective to protect and enforce any such rights, whether for the specific
enforcement of any covenant or agreement in this Indenture or in aid of the
exercise of any power granted herein, or to enforce any other proper remedy or
legal or equitable right vested in the Indenture Trustee by this Indenture or by
law.
(d) In case there shall be pending, relative to the Issuer or any other
obligor upon the Notes or any Person having or claiming an ownership interest in
the Collateral, Proceedings under Title 11 of the United States Code or any
other applicable federal or state bankruptcy, insolvency or other similar law,
or in case a receiver, assignee or trustee in bankruptcy or reorganization,
liquidator, sequestrator or similar official shall have been appointed for or
taken possession of the Issuer or its property or such other obligor or Person,
or in case of any other comparable judicial Proceedings relative to the Issuer
or other obligor upon the Notes, or to the creditors or property of the Issuer
or such other obligor, the Indenture Trustee, irrespective of
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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, [upon the direction of the Note
Insurer], by intervention in such Proceedings or otherwise:
(i) to file and prove a claim or claims for the whole amount
of principal and/or interest owing and unpaid in respect of the Notes
and to file such other papers or documents as may be necessary or
advisable in order to have the claims of the Indenture Trustee
(including any claim for reasonable compensation to the Indenture
Trustee, each predecessor Indenture Trustee [and Note Insurer,] 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 or bad faith), [the Note Insurer 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 moneys or other property
payable or deliverable on any such claims and to distribute all amounts
received with respect to the claims of the Noteholders, [the Note
Insurer] and the Indenture Trustee on their behalf; and
(iv) to file such proofs of claim and other papers or
documents as may be necessary or advisable in order to have the claims
of the Indenture Trustee, [the Note Insurer] or the Holders of Notes
allowed in any judicial proceedings relative to the Issuer, its
creditors and its property;
(v) and any trustee, receiver, liquidator, custodian or
other similar official in any such Proceeding is hereby authorized by
each of such Noteholders [and the Note Insurer] 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 [and the
Note Insurer], to pay to the Indenture Trustee such amounts as shall be
sufficient to cover reasonable compensation to the Indenture Trustee,
each predecessor Indenture Trustee and their respective agents,
attorneys and counsel, and all other expenses and liabilities incurred
and all advances made by the Indenture Trustee and each predecessor
Indenture Trustee except as a result of negligence or bad faith.
(e) Nothing herein contained shall be deemed to authorize the Indenture
Trustee to authorize or consent to or vote for or accept or adopt on behalf of
any Noteholder [or the Note Insurer] any plan of reorganization, arrangement,
adjustment or composition affecting the Notes or the rights of any Holder
thereof [or the Note Insurer] 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
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the production thereof in any trial or other Proceedings relative thereto, and
any such action or Proceedings instituted by the Indenture Trustee shall be
brought in its own name as trustee of an express trust, and any recovery of
judgment, subject to the payment of the expenses, disbursements and compensation
of the Indenture Trustee, each predecessor Indenture Trustee and their
respective agents, attorneys and counsel, shall be for the ratable benefit of
the Holders of the Notes [and the Note Insurer].
(g) In any Proceedings brought by the Indenture Trustee (and also any
Proceedings involving the interpretation of any provision of this Indenture to
which the Indenture Trustee shall be a party), the Indenture Trustee shall be
held to represent all the Noteholders, and it shall not be necessary to make any
Noteholder a party to any such Proceedings.
Section 5.04. Remedies; Priorities.
(a) If an Event of Default shall have occurred, the Indenture Trustee
shall, [at the direction of the Note Insurer, and if a Note Insurer Default has
occurred and is continuing,] the Indenture Trustee may, do one or more of the
following (subject to Section 5.05 hereof):
(i) institute Proceedings in its own name and as trustee of
an express trust for the collection of all amounts then payable on the
Notes or under this Indenture with respect thereto, whether by
declaration or otherwise, enforce any judgment obtained, and collect
from the Issuer and any other obligor upon such Notes moneys adjudged
due;
(ii) institute Proceedings from time to time for the complete
or partial foreclosure of this Indenture with respect to the Collateral;
(iii) exercise any remedies of a secured party under the UCC
and take any other appropriate action to protect and enforce the rights
and remedies of the Indenture Trustee, [the Note Insurer] or the
Noteholders; and
(iv) sell the Collateral or any portion thereof or rights or
interest therein in a commercially reasonable manner, at one or more
public or private sales called and conducted in any manner permitted by
law;
provided, however, that the Indenture Trustee may not sell or otherwise
liquidate the Collateral following an Event of Default, unless (A) the Holders
of 100% of the Voting Interests of the Outstanding Notes consent thereto, (B)
the proceeds of such sale or liquidation distributable to the Noteholders are
sufficient to discharge in full all amounts then due and unpaid upon such Notes
for principal (including any Deferred Amounts) and/or interest or (C) the
Indenture Trustee determines that the Collateral will not continue to provide
sufficient funds for the payment of principal of (including any Deferred
Amounts) and interest on the Notes as they would have become due if the Notes
had not been declared due and payable, and the Indenture Trustee obtains the
consent of Holders of 66-2/3% of the Voting Interests of the Highest Priority
Class Notes. In determining such sufficiency or insufficiency with respect to
clauses (B) and (C) of this subsection, the Indenture Trustee may, but need not,
obtain and rely upon an opinion of an Independent investment banking or
accounting firm of national reputation as to the feasibility of such proposed
action and as to the sufficiency of the Collateral for such purpose.
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(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 any costs or expenses
incurred by it in connection with the enforcement of the remedies
provided for in this Article V, for the Indenture Trustee Fee then due
and to the Owner Trustee and the Custodian for the Owner Trustee Fee and
any compensation to the Custodian then due;
[SECOND: to the Note Insurer for the Premium Amount then due and
unpaid;]
[THIRD: to the Servicer for the Servicing Fee then due and
unpaid;]
FOURTH: to the Noteholders for amounts due and unpaid on the
Notes for interest, pro rata according to the amounts due and payable on
the Notes for interest;
FIFTH: to the applicable Noteholders for amounts due and unpaid
on the Notes for principal, pro rata among the Holders of each such
Class of Notes, according to the amounts due and payable and in the
order and priorities set forth in Section 4.04 of the Sale and
Collection Agreement;
[SIXTH: to the Note Insurer for any amounts then due and payable
under the Insurance Agreement;]
SEVENTH: to the Depositor, any outstanding amounts payable or
reimbursable thereto under the Sale and Collection Agreement; and
EIGHTH: to the Owner Trustee, for any amounts to be distributed
to the holders of the Residual Interest Certificates pursuant to the
Trust Agreement.
The Indenture Trustee may fix a record date and payment date for any
payment to be made to the Noteholders pursuant to this Section. At least 15 days
before such record date, the Indenture Trustee shall mail to each Noteholder,
[the Note Insurer] and the Issuer a notice that states the record date, the
payment date and the amount to be paid.
Section 5.05. Optional Preservation of the Collateral.
If the Notes have been declared to be due and payable under Section 5.02
hereof following an Event of Default and such declaration and its consequences
have not been rescinded and annulled, the Indenture Trustee may, but need not,
elect to maintain possession of the Collateral. It is the desire of the parties
hereto and the Noteholders that there be at all times sufficient funds for the
payment of principal of and interest on the Notes, and the Indenture Trustee
shall take such desire into account when determining whether or not to maintain
possession of the Collateral. In determining whether to maintain possession of
the Collateral, the Indenture Trustee may, but need not, obtain and rely upon an
opinion of an Independent investment banking or accounting firm of national
reputation as to the feasibility of such proposed action and as to the
sufficiency of the Collateral for such purpose.
..
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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 [for so long as a Note
Insurer Default has not occurred or is not continuing, and shall not have any
such right if a Note Insurer Default has occurred and is continuing,] unless:
(a) such Holder has previously given written notice to the Indenture
Trustee of a continuing Event of Default;
(b) the Majority Highest Priority Class Noteholders have made written
request to the Indenture Trustee to institute such Proceeding in respect of such
Event of Default in its own name as Indenture Trustee hereunder;
(c) such 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;
(d) the Indenture Trustee for 60 days after its receipt of such notice,
request and offer of indemnity has failed to institute such Proceeding;
(e) no direction inconsistent with such written request has been given
to the Indenture Trustee during such 60-day period by the Majority Highest
Priority Class Noteholders; and
(f) [the Note Insurer has given its prior written consent.]
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
pursuant to this Section, each representing less than the Majority Highest
Priority Class Noteholders, 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. Unconditional Rights of Noteholders to Receive Principal
and Interest.
Notwithstanding any other provisions in this Indenture, 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, and Deferred Amounts, if
any, on such Note on or after the applicable Maturity Date thereof expressed in
such Note or in this Indenture (or, in the case of redemption, on or after the
Redemption Date) and to institute suit for the enforcement of any such payment,
and such right shall not be impaired without the consent of such Holder.
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Section 5.08. Restoration of Rights and Remedies.
If the Indenture Trustee, [the Note Insurer] 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, [the Note Insurer] or to
such Noteholder, then and in every such case the Issuer, the Indenture Trustee,
[the Note Insurer] and the Noteholders shall, subject to any determination in
such Proceeding, be restored severally and respectively to their former
positions hereunder, and thereafter all rights and remedies of the Indenture
Trustee, [the Note Insurer] 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 Note Insurer] 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 Note Insurer] or any
Holder of any Note to exercise any right or remedy accruing upon any Default or
Event of Default shall impair any such right or remedy or constitute a waiver of
any such Default or Event of Default or an acquiescence therein. Every right and
remedy given by this Article V or by law to the Indenture Trustee, [the Note
Insurer] or to the Noteholders may be exercised from time to time, and as often
as may be deemed expedient, by the Indenture Trustee, [the Note Insurer] or by
the Noteholders, as the case may be, [subject, in each case, however, to the
right of the Note Insurer to control any such right and remedy, except as
provided in Section 11.20.]
Section 5.11. Control by Noteholders.
The Majority Highest Priority Class Noteholders shall have the right to
direct the time, method and place of conducting any Proceeding for any remedy
available to the Indenture Trustee with respect to the Notes or exercising any
trust or power conferred on the Indenture Trustee; provided, however, that:
(a) such direction shall not be in conflict with any rule of law or with
this Indenture;
(b) subject to the express terms of Section 5.04 hereof, any direction
to the Indenture Trustee to sell or liquidate the Collateral shall be by Holders
of Notes representing not less than 100% of the Voting Interests of all Class of
Notes Outstanding;
(c) if the conditions set forth in Section 5.05 hereof have been
satisfied and the Indenture Trustee elects to retain the Collateral pursuant to
such Section, then any direction to the Indenture Trustee by Holders of Notes
representing less than 100% of the Outstanding Amount of the Highest Priority
Class Notes to sell or liquidate the Collateral shall be of no force and effect;
and
35
(d) 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 the Noteholders set forth in this Section
5.11, subject to Section 6.01 hereof, the Indenture Trustee need not take any
action that it determines might involve it in liability or might materially
adversely affect the rights of any Noteholders not consenting to such action.
Section 5.12. Waiver of Past Defaults.
Prior to the declaration of the acceleration of the maturity of the
Notes as provided in Section 5.02 hereof [the Note Insurer may, or with the
prior written consent of the Note Insurer], the Majority Highest Priority Class
Noteholders may waive any past Default or Event of Default and its consequences,
except a Default (a) in the payment of principal of or interest on any of the
Notes or (b) in respect of a covenant or provision hereof that cannot be
modified or amended without the consent of [the Note Insurer or] the Holder of
each Note. In the case of any such waiver, the Issuer, the Indenture Trustee,
[the Note Insurer] 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 Default or impair any right consequent
thereto.
Upon any such waiver, such Default shall cease to exist and be deemed to
have been cured and not to have occurred, and any Event of Default arising
therefrom shall be deemed to have been cured and not to have occurred, for every
purpose of this Indenture; but no such waiver shall extend to any subsequent or
other Default or Event of Default or impair any right consequent thereto.
Section 5.13. Undertaking for Costs.
All parties to this Indenture agree, and each Holder of any Note by such
Holder'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 shall not apply to (a) any suit
instituted by the Indenture Trustee [or the Note Insurer], (b) any suit
instituted by any Noteholder, or group of Noteholders, in each case holding in
the aggregate more than 10% of the Voting Interests of the Outstanding 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 (or, in the case of redemption, on
or after the Redemption Date).
Section 5.14. Waiver of Stay or Extension Laws.
The Issuer covenants (to the extent that it may lawfully do so) that it
will not at any time insist upon, or plead or in any manner whatsoever, claim or
take the benefit or advantage of, any stay or extension law wherever enacted,
now or at any time hereafter in force, that may affect the
36
covenants or the performance of this Indenture; and the Issuer (to the extent
that it may lawfully do so) hereby expressly waives all benefit or advantage of
any such law, and covenants that it will not hinder, delay or impede the
execution of any power herein granted to the Indenture Trustee [or the Note
Insurer], but will suffer and permit the execution of every such power as though
no such law had been enacted.
Section 5.15. Action on Notes.
The Indenture Trustee's right to seek and recover judgment on the Notes
or under this Indenture shall not be affected by the seeking, obtaining or
application of any other relief under or with respect to this Indenture. Neither
the lien of this Indenture nor any rights or remedies of the Indenture Trustee,
[the Note Insurer] or the Noteholders shall be impaired by the recovery of any
judgment by the Indenture Trustee [or the Note Insurer] against the Issuer or by
the levy of any execution under such judgment upon any portion of the Collateral
or upon any of the assets of the Issuer. Any money or property collected by the
Indenture Trustee shall be applied in accordance with Section 5.04(b) hereof.
Section 5.16. Performance and Enforcement of Certain Obligations.
(a) Promptly following a request from the Indenture Trustee [or the Note
Insurer] to do so and at the Administrator's expense, the Issuer shall take all
such lawful action as the Indenture Trustee may request to compel or secure the
performance and observance by the Depositor of its obligations to the Issuer
under or in connection with the Sale and Collection Agreement, or by the Seller
of its obligations under or in connection with the Mortgage Loan Sale Agreement
and to exercise any and all rights, remedies, powers and privileges lawfully
available to the Issuer under or in connection with the Sale and Collection
Agreement to the extent and in the manner directed by the Indenture Trustee, or
[the Note Insurer] including the transmission of notices of default on the part
of the Depositor, the Seller or [the Master Servicer] thereunder and the
institution of legal or administrative actions or proceedings to compel or
secure performance by the Depositor or the Seller of each of their obligations
under the Sale and Collection Agreement or the Mortgage Loan Sale Agreement.
(b) If an Event of Default has occurred and is continuing, the Indenture
Trustee may, [with the prior written consent of the Note Insurer, and shall at
the direction of the Note Insurer or with the prior written consent of the Note
Insurer], and at the direction (which direction shall be in writing or by
telephone, confirmed in writing promptly thereafter) of the Majority Highest
Priority Class Noteholders shall, exercise all rights, remedies, powers,
privileges and claims of the Issuer against the Depositor under or in connection
with the Sale and Collection Agreement, or against the Seller under or in
connection with the Mortgage Loan Sale Agreement including the right or power to
take any action to compel or secure performance or observance by the Depositor
or the Seller of each of their obligations to the Issuer thereunder and to give
any consent, request, notice, direction, approval, extension, or waiver under
the Sale and Collection Agreement or the Mortgage Loan Sale Agreement, as the
case may be, and any right of the Issuer to take such action shall be suspended.
37
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; provided, however, that the Indenture
Trustee shall examine the certificates and opinions to determine whether
or not they conform to the requirements of this Indenture.
(c) The Indenture Trustee may not be relieved from liability for its own
negligent action, its own negligent failure to act or its own willful
misconduct, except that:
(i) this paragraph does not limit the effect of paragraph
(b) of this Section 6.01;
(ii) the Indenture Trustee shall not be liable for any error
of judgment made in good faith by a Responsible Officer unless it is
proved that the Indenture Trustee was negligent in ascertaining the
pertinent facts; and
(iii) the Indenture Trustee shall not be liable with respect
to any action it takes or omits to take in good faith in accordance with
a direction received by it pursuant to Section 5.11 hereof.
(d) Every provision of this Indenture that in any way relates to the
Indenture Trustee is subject to paragraphs (a), (b), (c) and (g) of this Section
6.01.
(e) The Indenture Trustee shall not be liable for interest on any money
received by it except as the Indenture Trustee may agree in writing with the
Issuer.
(f) Money held in trust by the Indenture Trustee shall be segregated
from other funds except to the extent permitted by law or the terms of this
Indenture or the Sale and Collection Agreement.
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(g) No provision of this Indenture shall require the Indenture Trustee
to expend or risk its own funds or otherwise incur financial liability in the
performance of any of its duties hereunder or in the exercise of any of its
rights or powers, if it shall have reasonable grounds to believe that repayment
of such funds or adequate indemnity against such risk or liability is not
reasonably assured to it; provided, however, that the Indenture Trustee shall
not refuse or fail to perform any of its duties hereunder solely as a result of
nonpayment of its normal fees and expenses and provided, further, that nothing
in this Section 6.01(g) shall be construed to limit the exercise by the
Indenture Trustee of any right or remedy permitted under this Indenture or
otherwise in the event of the Issuer's failure to pay the Indenture Trustee's
fees and expenses pursuant to Section 6.07 hereof. In determining that such
repayment or indemnity is not reasonably assured to it, the Indenture Trustee
must consider not only the likelihood of repayment or indemnity by or on behalf
of the Issuer but also the likelihood of repayment or indemnity from amounts
payable to it from the Collateral pursuant to Section 6.07 hereof.
(h) Every provision of this Indenture relating to the conduct or
affecting the liability of or affording protection to the Indenture Trustee
shall be subject to the provisions of this Section and to the provisions of the
TIA.
(i) The Indenture Trustee shall not be required to take notice or be
deemed to have notice or knowledge of any Event of Default (other than an Event
of Default pursuant to Section 5.01(a)(i) or (ii) hereof) unless a Responsible
Officer of the Indenture Trustee shall have received written notice thereof or
otherwise shall have actual knowledge thereof. In the absence of receipt of
notice or such knowledge, the Indenture Trustee may conclusively assume that
there is no Event of Default.
(j) [The Administrator, on behalf of the Indenture Trustee, shall, and
hereby agrees that it will, hold the Note Insurance Policy in trust, and will
hold any proceeds of any claim on the Note Insurance Policy in trust solely for
the use and benefit of the Noteholders.]
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 any such document.
(b) Before the Indenture Trustee acts or refrains from acting, it may
require an Officer's Certificate or an Opinion of Counsel from the appropriate
party. 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 from the appropriate party.
(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. Notwithstanding anything to the
contrary herein, the Indenture Trustee shall remain liable for the performance
of any of its obligations hereunder or under the Basic Documents.
(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 such action or omission by the
Indenture Trustee does not constitute willful misconduct,
39
negligence or bad faith. Subject to the provisions of this Indenture, in no
event shall the appointment of any Custodian pursuant to a Custodial Agreement
diminish the obligations of the Indenture Trustee hereunder.
(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
with 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 other than
as Indenture Trustee may become the owner or pledgee of Notes and may otherwise
deal with the Issuer or its Affiliates with the same rights it would have if it
were not Indenture Trustee. Any Paying Agent, Note Registrar, co-registrar or
co-paying agent may do the same with like rights. However, the Indenture Trustee
must comply with Sections 6.11 and 6.12 hereof.
Section 6.04. Indenture Trustee's Disclaimer.
The Indenture Trustee shall not be responsible for and makes no
representation as to the validity or adequacy of this Indenture or the Notes,
and shall not be accountable for the Issuer's use of the proceeds from the Notes
or responsible for any statement of the Issuer in the Indenture or in any
document issued in connection with the sale of the Notes or in the Notes other
than the Indenture Trustee's certificate of authentication.
Section 6.05. Notices of Default.
If a Default occurs and is continuing and if it is known to a
Responsible Officer of the Indenture Trustee, the Indenture Trustee shall mail
to [the Note Insurer] notice of the Default after it occurs and each Noteholder
notice of the Default within 90 days after it occurs. Except in the case of a
Default in payment of principal of or interest on any Note (including payments
pursuant to the mandatory redemption provisions of such 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.
Section 6.07. Compensation and Indemnity.
As compensation for its services hereunder, the Indenture Trustee shall
be entitled to receive, on each Payment Date, investment income from the Note
Payment Account and the Certificate Distribution Account as specified in
Sections 4.04 and 4.05 of the Sale and Collection Agreement (which compensation
shall not be limited by any law on compensation of a trustee of an express
trust). The Seller agrees to indemnify the Indenture Trustee against any and all
loss, liability or expense (including attorneys' fees) incurred by it in
connection with the
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administration of this trust and the performance of its duties hereunder or any
of the other Basic Documents. The Indenture Trustee shall notify the Issuer,
[the Note Insurer] and the Seller promptly of any claim for which it may seek
indemnity. Failure by the Indenture Trustee so to notify the Issuer and the
Seller shall not relieve the Issuer or the Seller of its obligations hereunder.
The Issuer shall or shall cause the Seller to defend any such claim, and the
Indenture Trustee may have separate counsel reasonably acceptable to the Seller
and the Issuer shall or shall cause the Seller to pay the reasonable fees and
expenses of such counsel. Neither the Issuer nor the Seller need reimburse any
expense or indemnify against any loss, liability or expense incurred by the
Indenture Trustee through the Indenture Trustee's own willful misconduct,
negligence or bad faith.
The Issuer's payment obligations to the Indenture Trustee pursuant to
this Section 6.07 shall survive the discharge of this Indenture. When the
Indenture Trustee incurs expenses in connection with the occurrence of a Default
specified in Section 5.01(a)(v) or (vi) hereof with respect to the Issuer, the
expenses are intended to constitute expenses of administration under Title 11 of
the United States Code or any other applicable federal or state bankruptcy,
insolvency or similar law.
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
Note Insurer]. [The Note Insurer or] the Holders of a Majority of the Voting
Interests of the Outstanding Notes [with the consent of the Note Insurer] may
remove the Indenture Trustee by so notifying the Indenture Trustee and may
appoint a successor Indenture Trustee [acceptable to the Note Insurer]. The
Issuer shall remove the Indenture Trustee [upon the prior written consent of the
Note Insurer] if:
(a) the Indenture Trustee fails to comply with Section 6.11 hereof;
(b) the Indenture Trustee is adjudged a bankrupt or insolvent;
(c) a receiver or other public officer takes charge of the Indenture
Trustee or its property;
(d) the Indenture Trustee otherwise becomes incapable of acting; or
(e) the Indenture Trustee breaches any representation or warranty or
covenant made by it under any Basic Document.
If the Indenture Trustee resigns or is removed or if a vacancy exists in
the office of Indenture Trustee for any reason (the Indenture Trustee in such
event being referred to herein as the retiring Indenture Trustee), [the Note
Insurer may and if it fails to] the Issuer shall promptly appoint a successor
Indenture Trustee [acceptable to the Note Insurer] that satisfies the
eligibility requirements of Section 6.11.
The resigning or removed Indenture Trustee shall cooperate with the
Servicer and any successor Indenture Trustee in effecting the termination of the
resigning or removed Indenture
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Trustee's responsibilities and rights hereunder and shall promptly provide such
successor Indenture Trustee all documents and records reasonably requested by it
to enable it to assume the Indenture Trustee's functions hereunder. The
successor Indenture Trustee shall deliver a written acceptance of its
appointment to the retiring Indenture Trustee, [the Note Insurer] 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 Note Insurer], the Issuer or the Holders of a majority
of the Voting Interests of Outstanding Notes may petition any court of competent
jurisdiction for the appointment of a successor Indenture Trustee [acceptable to
the Note Insurer]. If the Indenture Trustee fails to comply with Section 6.11
hereof, any Noteholder [with the prior written consent of the Note Insurer] may
petition any court of competent jurisdiction for the removal of the Indenture
Trustee and the appointment of a successor Indenture Trustee [acceptable to the
Note Insurer]. Notwithstanding the replacement of the Indenture Trustee pursuant
to this Section 6.08, the Issuer's and the Administrator's obligations under
Section 6.07 hereof shall continue for the benefit of the retiring Indenture
Trustee.
Section 6.09. Successor Indenture Trustee by Merger.
If the Indenture Trustee consolidates with, merges or converts into, or
transfers all or substantially all its corporate trust business or assets to,
another corporation or banking association, the resulting, surviving or
transferee corporation without any further act shall be the successor Indenture
Trustee; provided, however, that such corporation or banking association shall
[be acceptable to the Note Insurer] and otherwise be qualified and eligible
under Section 6.11 hereof. The Indenture Trustee shall provide [the Note Insurer
and] the Rating Agencies prior written notice of any such transaction.
In case at the time such successor or successors by merger, conversion
or consolidation to the Indenture Trustee shall succeed to the trusts created by
this Indenture any of the Notes shall have been authenticated but not delivered,
any such successor to the Indenture Trustee may adopt the certificate of
authentication of any predecessor trustee, and deliver such Notes so
authenticated; and in case at that time any of the Notes shall not have been
authenticated, any successor to the Indenture Trustee may authenticate such
Notes either in the name of any predecessor hereunder or in the name of the
successor to the Indenture Trustee; and in all such cases such certificates
shall have the full force which it is anywhere in the Notes or in this Indenture
provided that the certificate of the Indenture Trustee shall have.
Section 6.10. Appointment of Co-Indenture Trustee or Separate Indenture
Trustee.
(a) Notwithstanding any other provisions of this Indenture, at any time,
for the purpose of meeting any legal requirement of any jurisdiction in which
any part of the Collateral may at the time be located, the Indenture Trustee
shall have the power, [with the prior written consent of
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the Note Insurer], 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 [and
the Note Insurer] such title to the Collateral, or any part hereof, and, subject
to the other provisions of this Section, such powers, duties, obligations,
rights and trusts as the Indenture Trustee [or the Note Insurer] may consider
necessary or desirable. No co-trustee or separate trustee hereunder shall be
required to meet the terms of eligibility as a successor trustee under Section
6.11 hereof and no notice to Noteholders of the appointment of any co-trustee or
separate trustee shall be required under Section 6.08 hereof; [provided that the
Indenture Trustee shall deliver notice of any such co-trustee or separate
trustee to the Note Insurer].
(b) Every separate trustee and co-trustee shall, to the extent permitted
by law, be appointed and act subject to the following provisions and conditions:
(i) all rights, powers, duties and obligations conferred or
imposed upon the Indenture Trustee shall be conferred or imposed upon
and exercised or performed by the Indenture Trustee and such separate
trustee or co-trustee jointly (it being understood that such separate
trustee or co-trustee is not authorized to act separately without the
Indenture Trustee joining in such act), except to the extent that under
any law of any jurisdiction in which any particular act or acts are to
be performed the Indenture Trustee shall be incompetent or unqualified
to perform such act or acts, in which event such rights, powers, duties
and obligations (including the holding of title to the Collateral or any
portion thereof in any such jurisdiction) shall be exercised and
performed singly by such separate trustee or co-trustee, but solely at
the direction of the Indenture Trustee;
(ii) no trustee hereunder shall be personally liable by
reason of any act or omission of any other trustee hereunder; and
(iii) the Indenture Trustee may at any time accept the
resignation of or remove any separate trustee or co-trustee.
(c) Any notice, request or other writing given to the Indenture Trustee
shall be deemed to have been given to each of the then separate trustees and
co-trustees, as effectively as if given to each of them. Every instrument
appointing any separate trustee or co-trustee shall refer to this Agreement and
the conditions of this Article VI. Each separate trustee and co-trustee, upon
its acceptance of the trusts conferred, shall be vested with the estates or
property specified in its instrument of appointment, jointly with the Indenture
Trustee, subject to all the provisions of this Indenture, specifically including
every provision of this Indenture relating to the conduct of, affecting the
liability of, or affording protection to, the Indenture Trustee. Every such
instrument shall be filed with the Indenture Trustee.
(d) Any separate trustee or co-trustee may at any time constitute the
Indenture Trustee its agent or attorney-in-fact with full power and authority,
to the extent not prohibited by law, to do any lawful act under or in respect of
this Agreement on its behalf and in its name. If any separate trustee or co-
trustee shall die, become incapable of acting, resign or be removed, all of its
estates, properties, rights, remedies and trusts shall vest in and be exercised
by the Indenture Trustee, to the extent permitted by law, without the
appointment of a new or successor trustee.
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Section 6.11. Eligibility; Disqualification.
The Indenture Trustee shall at all times satisfy the requirements of TIA
Section 310(a). The Indenture Trustee [shall be acceptable to the Note Insurer]
and 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 not less than ["A"] by S&P or shall
otherwise be acceptable to each Rating Agency. The Indenture Trustee shall
comply with TIA Section 310(b), including the optional provision permitted by
the second sentence of TIA Section 310(b)(9); PROVIDED, HOWEVER, that there
shall be excluded from the operation of TIA Section 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 TIA Section 310(b)(1) are met.
Section 6.12. Preferential Collection of Claims Against Issuer.
The Indenture Trustee shall comply with TIA Section 311(a), excluding
any creditor relationship listed in TIA Section 311(b). An Indenture Trustee
which has resigned or been removed shall be subject to TIA Section 311(a) to the
extent indicated.
Section 6.13. Appointment of Agent.
The Indenture Trustee hereby appoints [ ] as its agent (referred
to in the Basic Documents as the "Administrator") and, as necessary, its
attorney in fact, for the purpose of performing the duties of the Indenture
Trustee under this Agreement and the Custodial Agreement relating to compliance
with tax requirements and related reporting obligations, SEC reporting,
distributions and related reporting requirements, registration, execution and
authentication of Notes in its capacity as Note Registrar, establishment and
maintenance of accounts and the holding of the Trust Estate (other than the
Mortgage Files), and such other obligations as are set forth in the
Administration Agreement, including but not limited to those obligations set
forth in Section 6.01 of this Agreement.
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, (b) at such other times as the
Indenture Trustee may request in writing, within 30 days after receipt by the
Issuer of any such request, a list of similar form and content as of a date not
more than 10 days prior to the time such list is furnished; PROVIDED, HOWEVER,
that so long as the Indenture Trustee is the Note Registrar, no such list shall
be required to be furnished. [The Indenture Trustee, or if the Indenture Trustee
is no longer the Note Registrar, the Issuer shall furnish to the Note Insurer in
writing on an annual basis and at such times as the Note Insurer shall request a
copy of the list of Noteholders.]
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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 hereof 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. [The Indenture Trustee shall make such
list available to the Note Insurer upon request.]
(b) Noteholders may communicate pursuant to TIA Section 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 TIA Section 312(c).
Section 7.03. Reports by Issuer.
(a) The Issuer shall:
(i) file with the Indenture Trustee [and the Note Insurer],
within 15 days after the Issuer is required to file the same with the
Commission, copies of the annual reports and of 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, [the Note Insurer] and
the Commission in accordance with the 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 TIA
Section 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 TIA Section 313(a), within 60 days after each [ ]
1, beginning with [ ], the Indenture Trustee shall mail to [the Note
Insurer] and each Noteholder as required by TIA Section 313(c) a brief report
dated as of such date that
45
complies with TIA Section 313(a). The Indenture Trustee also shall comply with
TIA Section 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 securities 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 securities exchange.
ARTICLE VIII
ACCOUNTS, DISBURSEMENTS AND RELEASES
Section 8.01. Collection of Money.
(a) General. Except as otherwise expressly provided herein, the
Indenture Trustee may demand payment or delivery of, and shall receive and
collect, directly and without intervention or assistance of any 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
Collateral, the Indenture Trustee may, [and upon written request of the Note
Insurer shall,] take such action as may be appropriate to enforce such payment
or performance, including the institution and prosecution of appropriate
Proceedings. Any such action shall be without prejudice to any right to claim a
Default or Event of Default under this Indenture and any right to proceed
thereafter as provided in Article V hereof.
(b) [Claims Under Note Insurance Policy. The Notes will be insured by
the Note Insurance Policy pursuant to the terms set forth therein,
notwithstanding any provisions to the contrary contained in this Indenture or
the Sale and Collection Agreement. All amounts received under the Note Insurance
Policy shall be used solely for the payment to Noteholders of principal and
interest on the Insured Notes.]
Section 8.02. Trust Accounts; Distributions.
(a) On or prior to the Closing Date, the Indenture Trustee shall
establish and maintain, in the name of the Indenture Trustee for the benefit of
the Noteholders [and the Note Insurer], or on behalf of the Owner Trustee for
the benefit of the Securityholders, the Trust Accounts, as provided in the Sale
and Collection Agreement. The Issuer shall cause each Servicer to, and the
Paying Agent shall, deposit amounts into each of the Trust Accounts in
accordance with the terms hereof and the Sale and Collection Agreement and the
related Servicing Agreement.
(b) On each Payment Date, to the extent funds are available in the Note
Payment Account, the Indenture Trustee shall either retain funds in the Note
Payment Account for distribution on such date in accordance with Section 4.04 of
the Sale and Collection Agreement or make the withdrawals from the Note Payment
Account and deposits into the Certificate Distribution Account for distribution
on such Payment Date as required pursuant to Section 4.05 of the Sale and
Collection Agreement.
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(c) On each Payment Date and each Redemption Date, to the extent of the
interest of the Indenture Trustee in the Certificate Distribution Account (as
provided in Section 4.05 of the Sale and Collection Agreement), the Indenture
Trustee hereby authorizes the Owner Trustee or the Paying Agent, as applicable,
to make the distributions from the Certificate Distribution Account as required
pursuant to Section 4.05 of the Sale and Collection Agreement.
(d) [The Indenture Trustee shall make claims under the Note Insurance
Policy pursuant to Section [ ] of the Sale and Collection Agreement and in
accordance with the Note Insurance Policy. The Indenture Trustee shall deposit
any Insured Payment received from the Note Insurer in the Note Payment Account
for payment to Insured Noteholders. With respect to claims under the Note
Insurance Policy for a Preference Amount, the Indenture Trustee shall distribute
such amount in accordance with the terms of the Note Insurance Policy. All
amounts received under the Note Insurance Policy shall be used solely for the
payment to Noteholders of principal and interest on the Insured Notes.]
Section 8.03. General Provisions Regarding Accounts.
(a) So long as no Default or Event of Default shall have occurred and be
continuing, all or a portion of the funds in the Trust Accounts shall be
invested in accordance with the provisions of the Sale and Collection Agreement,
and all income or other gain from investments of moneys deposited in the Trust
Accounts shall be disbursed in accordance with the provisions of the Sale and
Collection Agreement. The Issuer will not direct the Indenture Trustee to make
any investment of any funds or to sell any investment held in any of the Trust
Accounts unless the security interest Granted and perfected in such account will
continue to be perfected in such investment or the proceeds of such sale, in
either case without any further action by any Person.
(b) Subject to Section 6.01(c) hereof, the Indenture Trustee shall not
in any way be held liable by reason of any insufficiency in any of the Trust
Accounts resulting from any loss on any Eligible Investment included therein
except (i) for losses attributable to the Indenture Trustee's failure to make
payments on such Eligible Investments issued by the Indenture Trustee, in its
commercial capacity as principal obligor and not as trustee, in accordance with
their terms and (ii) as expressly provided herein or in the Sale and Collection
Agreement.
Section 8.04. Servicer's Monthly Statements.
On each Payment Date, the Indenture Trustee shall deliver the Servicer's
Monthly Remittance Report with respect to such Payment Date to DTC, the Rating
Agencies [and the Note Insurer].
Section 8.05. Release of Collateral.
(a) Subject to the payment of its fees and expenses pursuant to Section
6.07 hereof, the Indenture Trustee may, and when required by the provisions of
this Indenture or the Sale and Collection Agreement 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 or the Sale and Collection
Agreement. No party relying upon an instrument executed by the Indenture Trustee
47
as provided in this Article VIII shall be bound to ascertain the Indenture
Trustee's authority, inquire into the satisfaction of any conditions precedent
or see to the application of any moneys.
(b) The Indenture Trustee shall, at such time as there are no Notes
Outstanding and all sums due to [the Note Insurer], the Indenture Trustee and
each Servicer pursuant to this Indenture, the Sale and Collection Agreement and
the Basic Documents have been paid, release any remaining portion of the
Collateral that secured the Notes from the lien of this Indenture and release to
the Issuer or any other Person entitled thereto any funds then on deposit in the
Trust Accounts. The Indenture Trustee shall release property from the lien of
this Indenture pursuant to this Subsection (b) only upon receipt by it [and the
Note Insurer] of an Issuer Request accompanied by an Officer's Certificate, an
Opinion of Counsel and (if required by the TIA) Independent Certificates in
accordance with TIA Sections 314(c) and 314(d)(1) meeting the applicable
requirements of Section 11.01 hereof.
Section 8.06. Opinion of Counsel.
The Indenture Trustee [and the Note Insurer] shall receive at least
seven days' prior notice when requested by the Issuer to take any action
pursuant to Section 8.05(a) hereof, accompanied by copies of any instruments
involved, and the Indenture Trustee [and the Note Insurer] may also require, as
a condition to such action, an Opinion of Counsel, in form and substance
satisfactory to the Indenture Trustee [and the Note Insurer], stating the legal
effect of any such action, outlining the steps required to complete the same,
and concluding that all conditions precedent to the taking of such action have
been complied with and such action will not materially and adversely impair the
security for the Notes or the rights of the Noteholders in contravention of the
provisions of this Indenture; provided, however, that such Opinion of Counsel
shall not be required to express an opinion as to the fair value of the
Collateral. Counsel rendering any such opinion may rely, without independent
investigation, on the accuracy and validity of any certificate or other
instrument delivered to the Indenture Trustee in connection with any such
action.
ARTICLE IX
SUPPLEMENTAL INDENTURES
Section 9.01. Supplemental Indentures Without Consent of Noteholders.
(a) Without the consent of the Holders of any Notes but with prior
notice to the Rating Agencies [and with the prior written consent of the Note
Insurer], the Issuer and the Indenture Trustee, when authorized by an Issuer
Order, at any time and from time to time, may enter into one or more indentures
supplemental hereto (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;
48
(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 [and the Note Insurer], or to surrender any
right or power herein conferred upon the Issuer;
(iv) to convey, transfer, assign, mortgage or pledge any
property to or with the Indenture Trustee;
(v) to cure any ambiguity, to correct or supplement any
provision herein or in any supplemental indenture that may be
inconsistent with any other provision herein or in any supplemental
indenture or to conform the provisions hereof to those of any Offering
Document, to obtain a rating for a Class of Securities from a nationally
recognized statistical rating organization, or to make any other
provisions with respect to matters or questions arising under this
Indenture or in any supplemental indenture; provided, however, that such
action shall not adversely affect the interests of the Holders of the
Notes;
(vi) to evidence and provide for the acceptance of the
appointment hereunder by a successor trustee with respect to the Notes
and to add to or change any of the provisions of this Indenture as shall
be necessary to facilitate the administration of the trusts hereunder by
more than one trustee, pursuant to the requirements of Article VI
hereof; or
(vii) 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 supplemental indenture shall be entered into
unless the Indenture Trustee shall have received an Opinion of Counsel stating
that entering into such supplemental indenture will not (A) result in a
"substantial modification" of the Notes under Treasury Regulation Section
1.1001.3 or adversely affect the status of the Notes as indebtedness for federal
income tax purposes or (B) cause the Trust to be subject to an entity level tax.
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, [with the prior written
consent of the Note Insurer], when authorized by an Issuer Order, may, also
without the consent of any of the Holders of the Notes but with prior consent of
the Rating Agencies, 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
49
not, as evidenced by (i) an Opinion of Counsel or (ii) satisfaction of the
Rating Agency Condition, adversely affect in any material respect the interests
of any Noteholder.
Section 9.02. Supplemental Indentures with Consent of Noteholders.
The Issuer and the Indenture Trustee, when authorized by an Issuer
Order, also may, with prior consent of the Rating Agencies, [the Note Insurer]
and with the consent of the Holders of not less than a majority of the Voting
Interests of the Outstanding Notes, by Act 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 Outstanding Note affected thereby [and the
Note Insurer] if affected thereby:
(a) change the date of payment of any installment of principal of or
interest on any Note, or reduce the Principal Amount (or Notional Amount)
thereof, the Interest Rate thereon or the Termination Price with respect
thereto, change the provisions of this Indenture relating to the application of
collections on, or the proceeds of the sale of, the Collateral to payment of
principal of or interest on the Notes, or change any place of payment where, or
the coin or currency in which, any Note or the interest thereon is payable, or
impair the right to institute suit for the enforcement of the provisions of this
Indenture requiring the application of funds available therefor, as provided in
Article V hereof, to the payment of any such amount due on the Notes on or after
the respective due dates thereof (or, in the case of redemption, on or after the
Redemption Date);
(b) reduce the percentage of the Voting Interests of the Outstanding
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;
(c) modify or alter the provisions of the proviso to the definitions of
the term "Outstanding" or "Voting Interests";
(d) reduce the percentage of the Voting Interests of the Notes required
to direct the Indenture Trustee to direct the Issuer to sell or liquidate the
Collateral pursuant to Section 5.04 hereof;
(e) modify any provision of this Section except to increase any
percentage specified herein or to provide that certain additional provisions of
this Indenture or the Basic Documents cannot be modified or waived without the
consent of the Holder of each Outstanding Note affected thereby;
(f) modify any of the provisions of this Indenture in such manner as to
affect the calculation of the amount of any payment of interest or principal due
on any Note on any Payment Date (including the calculation of any of the
individual components of such calculation) or to affect the rights of the
Holders of Notes to the benefit of any provisions for the mandatory redemption
of the Notes contained herein; or
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(g) permit the creation of any lien ranking prior to or on a parity with
the lien of this Indenture with respect to any part of the Collateral or, except
as otherwise permitted or contemplated herein, terminate the lien of this
Indenture on any property at any time subject hereto or deprive the Holder of
any Note of the security provided by the lien of this Indenture.
The Indenture Trustee may in its discretion determine whether or not any
Notes would be affected by any supplemental indenture and any such determination
shall be conclusive upon 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.
In connection with requesting the consent of the Noteholders pursuant to
this Section 9.02, the Indenture Trustee shall mail to the Holders of the Notes
to which such amendment or supplemental indenture relates a notice setting forth
in general terms the substance of such supplemental indenture. It shall not be
necessary for any Act of Noteholders under this Section 9.02 to approve the
particular form of any proposed supplemental indenture, but it shall be
sufficient if such Act shall approve the substance thereof.
Section 9.03. Execution of Supplemental Indentures.
In executing, or permitting the additional trusts created by, any
supplemental indenture permitted by this Article IX or the modification thereby
of the trusts created by this Indenture, the Indenture Trustee shall be entitled
to receive, and subject to Sections 6.01 and 6.02 hereof, shall be fully
protected in relying upon, an Opinion of Counsel stating that the execution of
such supplemental indenture is authorized or permitted by this Indenture. The
Indenture Trustee may, but shall not be obligated to, enter into any such
supplemental indenture that affects the Indenture Trustee's own rights, duties,
liabilities or immunities under this Indenture or otherwise. The Indenture
Trustee shall provide a fully executed copy of any supplemental indenture to
this Indenture, to [the Note Insurer and] each Rating Agency.
Section 9.04. Effect of Supplemental Indentures.
Upon the execution of any supplemental indenture pursuant to the
provisions hereof, this Indenture shall be and shall be deemed to be modified
and amended in accordance therewith with respect to the Notes affected thereby,
and the respective rights, limitations of rights, obligations, duties,
liabilities and immunities under this Indenture of the Indenture Trustee, the
Issuer and the Holders of the Notes shall thereafter be determined, exercised
and enforced hereunder subject in all respects to such modifications and
amendments, and all the terms and conditions of any such supplemental indenture
shall be and be deemed to be part of the terms and conditions of this Indenture
for any and all purposes.
Section 9.05. 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.
51
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 [and the Note Insurer] 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.
Section 9.07. Amendments to Trust Agreement.
Subject to [Section 11.01] of the Trust Agreement, the Indenture Trustee
shall, upon Issuer Order, consent to any proposed amendment to the Trust
Agreement or an amendment to or waiver of any provision of any other document
relating to the Trust Agreement, such consent to be given without the necessity
of obtaining the consent of the Holders of any Notes [but with the consent of
the Note Insurer] upon satisfaction of the requirements under [Section 11.01] of
the Trust Agreement.
Nothing in this Section shall be construed to require that any Person
obtain the consent of the Indenture Trustee to any amendment or waiver or any
provision of any document where the making of such amendment or the giving of
such waiver without obtaining the consent of the Indenture Trustee is not
prohibited by this Indenture or by the terms of the document that is the subject
of the proposed amendment or waiver.
ARTICLE X
REDEMPTION OF NOTES
Section 10.01. Redemption.
The Majority Residual Interestholders may, at their option, effect an
early redemption of the Notes on any Payment Date on or after the Payment Date
on which the Total Loan Balance declines to 10% or less of the Cut-off Date Pool
Balance. The Majority Residual Interestholders shall effect such early
redemption in the manner specified in and subject to the provisions of Section
6.01 of the Sale and Collection Agreement. [If the Majority Residual
Interestholders do not exercise such option within three calendar months of the
date in which it is first entitled to do so, the Note Insurer shall have the
option to effect such early redemption in the manner specified in and subject to
the provisions of Section 6.01 of the Sale and Collection Agreement.]
The Indenture Trustee shall furnish the Rating Agencies and [the Note
Insurer] notice of any such redemption in accordance with Section 10.02 hereof.
Section 10.02. Form of Redemption Notice.
Notice of redemption under Section 10.01 hereof shall be given by the
Indenture Trustee by first- class mail, postage prepaid, or by facsimile mailed
or transmitted not later than 10 days prior to the applicable Redemption Date to
[the Note Insurer and] each Holder of Notes, as of the close of business on the
Record Date preceding the applicable Redemption Date, at such Holder's address
or facsimile number appearing in the Note Register.
52
All notices of redemption shall state:
(a) the Redemption Date;
(b) the Termination Price; and
(c) the place where such Notes are to be surrendered for payment of the
Termination Price (which shall be the office or agency of the Issuer to be
maintained as provided in Section 3.02 hereof).
Notice of redemption of the Notes shall be given by the Indenture
Trustee in the name of the Issuer and at the expense of [ ]. Failure to
give to any Holder of any Note notice of redemption, or any defect therein,
shall not impair or affect the validity of the redemption of any other Note.
Section 10.03. Notes Payable on Redemption Date; Provision for Payment
of Indenture Trustee and Note Insurer.
The Notes to be redeemed shall, following notice of redemption as
required by Section 10.02 hereof (in the case of redemption pursuant to Section
10.01) hereof, on the Redemption Date become due and payable at the Termination
Price and (unless the Issuer shall default in the payment of the Termination
Price) no interest shall accrue thereon for any period after the date to which
accrued interest is calculated for purposes of calculating the Termination
Price. The Issuer may not redeem the Notes unless (i) all outstanding
obligations under the Notes have been paid in full and (ii) the Indenture
Trustee has been paid all amounts to which it is entitled hereunder [and the
Note Insurer has been paid all Reimbursement Amounts to which it is entitled as
of the applicable Redemption Date].
ARTICLE XI
MISCELLANEOUS
Section 11.01. 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 (except with
respect to the Servicer's servicing activity in the ordinary course of its
business), the Issuer shall furnish to the Indenture Trustee [and the Note
Insurer] (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, (ii) an Opinion of Counsel stating that in the opinion of such
counsel all such conditions precedent, if any, have been complied with and (iii)
(if required by the TIA) an Independent Certificate from a firm of certified
public accountants meeting the applicable requirements of this Section, 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:
53
(i) 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;
(ii) 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;
(iii) a statement that, in the opinion of each such signatory,
such signatory has made such examination or investigation as is
necessary to enable such signatory to express an informed opinion as to
whether or not such covenant or condition has been complied with; and
(iv) a statement as to whether, in the opinion of each such
signatory, such condition or covenant has been complied with.
(b) 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 11.01(a) hereof
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.
(c) 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 subsection (b) above, the Issuer shall also
deliver to the Indenture Trustee [and the Note Insurer] 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
subsection (b) above and this subsection (c), is [__]% or more of the
Outstanding Amount 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 [$_______]
or less than one percent of the Outstanding Amount of the Notes.
(d) Whenever any property or securities are to be released from the lien
of this Indenture, the Issuer shall also furnish to the Indenture Trustee [and
the Note Insurer] 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.
(e) 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 subsection (d) above, the Issuer shall also
furnish to the Indenture Trustee [and the Note Insurer] an Independent
Certificate as to the same matters if the fair value of the property or
securities
54
and of all other property, other than 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 subsection (d) above and this subsection (e),
equals 10% or more of the Outstanding Amount 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 [$_______] or less than one percent of the then Outstanding Amount of the
Notes.
Section 11.02. Form of Documents Delivered to Indenture Trustee.
In any case where several matters are required to be certified by, or
covered by an opinion of, any specified Person, it is not necessary that all
such matters be certified by, or covered by the opinion of, only one such
Person, or that they be so certified or covered by only one document, but one
such Person may certify or give an opinion with respect to some matters and one
or more other such Persons as to other matters, and any such Person may certify
or give an opinion as to such matters in one or several documents.
Any certificate or opinion of an Authorized Officer of the Issuer may be
based, insofar as it relates to legal matters, upon a certificate or opinion of,
or representations by, counsel, unless such officer knows, or in the exercise of
reasonable care should know, that the certificate or opinion or representations
with respect to the matters upon which such officer's certificate or opinion is
based are erroneous. Any such certificate of an Authorized Officer or Opinion of
Counsel may be based, insofar as it relates to factual matters, upon a
certificate or opinion of, or representations by, an officer or officers of the
Servicer, the Depositor, the Issuer or the Administrator, stating that the
information with respect to such factual matters is in the possession of the
Servicer, the Depositor, the Issuer or the Administrator, unless such counsel
knows, or in the exercise of reasonable care should know, that the certificate
or opinion or representations with respect to such matters are erroneous.
Where any Person is required to make, give or execute two or more
applications, requests, consents, certificates, statements, opinions or other
instruments under this Indenture, they may, but need not, be consolidated and
form one instrument.
Whenever in this Indenture, in connection with any application or
certificate or report to the Indenture Trustee, it is provided that the Issuer
shall deliver any document as a condition of the granting of such application,
or as evidence of the Issuer's compliance with any term hereof, it is intended
that the truth and accuracy, at the time of the granting of such application or
at the effective date of such certificate or report (as the case may be), of the
facts and opinions stated in such document shall in such case be conditions
precedent to the right of the Issuer to have such application granted or to the
sufficiency of such certificate or report. The foregoing shall not, however, be
construed to affect the Indenture Trustee's right to rely upon the truth and
accuracy of any statement or opinion contained in any such document as provided
in Article VI hereof.
Section 11.03. Acts of Noteholders.
(a) Any request, demand, authorization, direction, notice, consent,
waiver or other action provided by this Indenture to be given or taken by
Noteholders may be embodied in and evidenced by one or more instruments of
substantially similar tenor signed by such Noteholders
55
in person or by agents duly appointed in writing; and except as herein otherwise
expressly provided, such action shall become effective when such instrument or
instruments are delivered to the Indenture Trustee, and, where it is hereby
expressly required, to the Issuer. Such instrument or instruments (and the
action embodied therein and evidenced thereby) are herein sometimes referred to
as the "Act" of the Noteholders signing such instrument or instruments. Proof of
execution of any such instrument or of a writing appointing any such agent shall
be sufficient for any purpose of this Indenture and (subject to Section 6.01
hereof) conclusive in favor of the Indenture Trustee and the Issuer, if made in
the manner provided in this Section.
(b) The fact and date of the execution by any person of any such
instrument or writing may be proved in any manner that the Indenture Trustee
deems sufficient.
(c) The ownership of Notes shall be proved by the Note Register.
(d) Any request, demand, authorization, direction, notice, consent,
waiver or other action by 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 11.04. Notices, etc., to Indenture Trustee, Issuer, Rating
Agencies and Note Insurer.
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:
(a) the Indenture Trustee by any Noteholder, [the Note Insurer] or by
the Issuer shall be sufficient for every purpose hereunder if made, given,
furnished or filed in writing to or with the Indenture Trustee at its Corporate
Trust Office, or
(b) the Issuer by the Indenture Trustee, [the Note Insurer] or by any
Noteholder shall be sufficient for every purpose hereunder if in writing and
made, given, furnished or filed with the Issuer addressed to: Aegis Asset Backed
Securities Corporation [ ] Trust [ ], in care of
[ ], Attention:
[ ], or at any other address previously furnished in writing to
the Indenture Trustee by the Issuer or the Administrator. The Issuer shall
promptly transmit any notice received by it from the Noteholders to the
Indenture Trustee.
Notices required to be given to the Rating Agencies [and the Note
Insurer] 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 the applicable address specified in the Sale and Collection
Agreement.
56
Section 11.05. Notices to Noteholders; Waiver.
Where this Indenture provides for notice to Noteholders of any event,
such notice shall be sufficiently given (unless otherwise herein expressly
provided) if in writing and mailed, first-class, postage prepaid to each
Noteholder affected by such event, at his address as it appears on the Note
Register, not later than the latest date, and not earlier than the earliest
date, prescribed for the giving of such notice. In any case where notice to
Noteholders is given by mail, neither the failure to mail such notice nor any
defect in any notice so mailed to any particular Noteholder shall affect the
sufficiency of such notice with respect to other Noteholders, and any notice
that is mailed in the manner herein provided shall conclusively be presumed to
have duly been given.
Where this Indenture provides for notice in any manner, such notice may
be waived in writing by any Person entitled to receive such notice, either
before or after the event, and such waiver shall be the equivalent of such
notice. Waivers of notice by Noteholders shall be filed with the Indenture
Trustee but such filing shall not be a condition precedent to the validity of
any action taken in reliance upon such a waiver.
In case, by reason of the suspension of regular mail service as a result
of a strike, work stoppage or similar activity, it shall be impractical to mail
notice of any event to Noteholders when such notice is required to be given
pursuant to any provision of this Indenture, then any manner of giving such
notice as shall be satisfactory to the Indenture Trustee shall be deemed to be a
sufficient giving of such notice.
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 a Default or Event of
Default.
Section 11.06. 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 TIA Sections 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 11.07. Effect of Headings and Table of Contents.
The Article and Section headings herein and the Table of Contents are
for convenience only and shall not affect the construction hereof.
Section 11.08. 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.
57
Section 11.09. Separability.
In case any provision in this Indenture or in the Notes shall be
invalid, illegal or unenforceable, the validity, legality and enforceability of
the remaining provisions shall not in any way be affected or impaired thereby.
Section 11.10. Benefits of Indenture.
Nothing in this Indenture or in the Notes, express or implied, shall
give to any Person, other than the parties hereto and their successors
hereunder, and the Noteholders, and any other party secured hereunder, and any
other Person with an ownership interest in any part of the Collateral, any
benefit or any legal or equitable right, remedy or claim under this Indenture.
Each Noteholder and Note Owner, by acceptance of a Note or, in the case of a
Note Owner, a beneficial interest in a Note, consents to and agrees to be bound
by the terms and conditions of this Indenture.
Section 11.11. 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 11.12. GOVERNING LAW.
THIS INDENTURE SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE
STATE OF [ ], AND TO THE EXTENT PERMITTED BY LAW WITHOUT REFERENCE
TO ITS CONFLICT OF LAW PROVISIONS, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF
THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
Section 11.13. Counterparts.
This Indenture may be executed in any number of counterparts, each of
which so executed shall be deemed to be an original, but all such counterparts
shall together constitute but one and the same instrument.
Section 11.14. 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 the
expense of the Servicer accompanied by an Opinion of Counsel (which may be
counsel to the Indenture Trustee or any other counsel reasonably acceptable to
the Indenture Trustee [and the Note Insurer]) 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.
58
Section 11.15. Trust Obligation.
No recourse may be taken, directly or indirectly, with respect to the
obligations of the Issuer, the Owner Trustee or the Indenture Trustee on the
Notes or, except as expressly provided for in Article VI hereof, under this
Indenture or any certificate or other writing delivered in connection herewith
or therewith, against (i) the Indenture Trustee or the Owner Trustee in its
individual capacity, (ii) any owner of a beneficial interest in the Issuer or
(iii) any partner, owner, beneficiary, agent, officer, director, employee 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
expressly have agreed (it being understood that the Indenture Trustee and the
Owner Trustee have no such obligations in their individual capacity) and except
that any such partner, owner or beneficiary shall be fully liable, to the extent
provided by applicable law, for any unpaid consideration for stock, unpaid
capital contribution or failure to pay any installment or call owing to such
entity. For all purposes of this Indenture, in the performance of any duties or
obligations of the Issuer hereunder, the Owner Trustee shall be subject to, and
entitled to the benefits of, the terms and provisions of Articles VI, VII and
VIII of the Trust Agreement.
Section 11.16. No Petition.
The Indenture Trustee, by entering into this Indenture, and each
Noteholder, by accepting a Note, hereby covenant and agree that they will not at
any time institute against the Depositor, the Servicer or the Issuer, or join in
any institution against the Depositor, the Servicer 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 11.17. Inspection.
The Issuer agrees that, on reasonable prior notice, it will permit any
representative of the Indenture Trustee [or the Note Insurer], during the
Issuer's normal business hours, to examine all the books of account, records,
reports and other papers of the Issuer, to make copies and extracts therefrom,
to cause such books to be audited by Independent certified public accountants,
and to discuss the Issuer's affairs, finances and accounts with the Issuer's
officers, employees, and Independent certified public accountants, all at such
reasonable times and as often as may reasonably be requested. 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.
Section 11.18. [Grant of Noteholder Rights to Note Insurer].
In consideration for the guarantee of the Insured Notes by the Note
Insurer pursuant to the Note Insurance Policy, the Noteholders hereby grant to
the Note Insurer the right to act as the holder of [___]% of the Outstanding
Notes for the purpose of exercising the rights of the Holders of the Notes
hereunder, including the voting rights of such Holders, but excluding those
rights to
59
distributions under Section 8.02 hereof; provided that the preceding grant of
rights to the Note Insurer by the Noteholders shall be subject to Section 11.20
hereof. The rights of the Note Insurer to direct certain actions and consent to
certain actions of the Noteholders hereunder will terminate at such time as the
Class Principal Amount of each Class of Insured Notes has been reduced to zero
and the Note Insurer has been reimbursed for all Insured Payments and any other
amounts owed under the Note Insurance Policy and the Insurance Agreement and the
Note Insurer has no further obligation under the Note Insurance Policy.]
Section 11.19. [Third Party Beneficiary].
[The parties hereto acknowledge that the Note Insurer is an express
third party beneficiary hereof entitled to enforce any rights reserved to it
hereunder as if it were actually a party hereto.]
Section 11.20. [Suspension and Termination of Note Insurer's Rights].
(a) During the continuation of a Note Insurer Default, rights granted or
reserved to the Note Insurer hereunder shall vest instead in the Noteholders;
provided that the Note Insurer shall be entitled to any distributions in
reimbursement of the Note Insurer Reimbursement Amount, and the Note Insurer
shall retain those rights under Section 9.02 hereof to consent to any supplement
to this Indenture.
(b) At such time at either (i) the Class Principal Amount of each Class
of Insured Notes has been reduced to zero or (ii) the Note Insurance Policy has
been terminated following a Note Insurer Default, and in case of either (i) or
(ii) the Note Insurer has been reimbursed for all Insured Payments and any other
amounts owed under the Note Insurance Policy and the Insurance Agreement (and
the Note Insurer no longer has any obligation under the Note Insurance Policy,
except for breach thereof by the Note Insurer), then the rights and benefits
granted or reserved to the Note Insurer hereunder (including the rights to
direct certain actions and receive certain notices) shall terminate and the
Noteholders shall be entitled to exercise of such rights and to receive such
benefits of the Note Insurer following such termination to the extent that such
rights and benefits are applicable to the Noteholders.]
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IN WITNESS WHEREOF, the Issuer and the Indenture Trustee have caused
this Indenture to be duly executed by their respective officers, thereunto duly
authorized and duly attested, all as of the day and year first above written.
AEGIS ASSET BACKED SECURITIES
CORPORATION [ ] TRUST [ ],
as Issuer
By: [ ],
not in its individual capacity but
solely as Owner Trustee
By:
-------------------------------
Name:
Title:
[ ],
as Indenture Trustee
By:
---------------------------------
Name:
Title:
Accepted and Agreed to for
purposes of Section 6.07 only:
[ ],
as Seller
By:
--------------------------------
Name:
Title:
STATE OF )
)
COUNTY OF )
BEFORE ME, the undersigned authority, a Notary Public in and for said
county and state, on this day personally appeared ___________________________,
known to me to be the person and officer whose name is subscribed to the
foregoing instrument and acknowledged to me that the same was the act of the
said ___________, not in its individual capacity, but solely as Owner Trustee on
behalf of AEGIS ASSET BACKED SECURITIES CORPORATION [ ] TRUST [ ],
a [Delaware] business trust, and that such person executed the same as the act
of said business trust for the purpose and consideration therein expressed, and
in the capacities therein stated.
GIVEN UNDER MY HAND AND SEAL OF OFFICE, this ____ day of __________,
[ ].
Notary Public in and for the State of [ ]
My commission expires:
STATE OF )
)
COUNTY OF )
BEFORE ME, the undersigned authority, a Notary Public in and for said
county and state, on this day personally appeared __________________________,
known to me to be the person and officer whose name is subscribed to the
foregoing instrument and acknowledged to me that the same was the act of
___________________, a ________________________, and that such person executed
the same as the act of said corporation for the purpose and consideration
therein stated.
GIVEN UNDER MY HAND AND SEAL OF OFFICE, this ___ day of _________,
[ ].
Notary Public in and for the State of [ ] (Seal)
My commission expires:
EXHIBIT A
FORM OF NOTES
