EXHIBIT 4.3
Execution Copy
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THE MONEY STORE TRUST 1998-C
Class AF-1 Adjustable Rate Notes
Class AF-2 Auction Rate Notes
Class AV Adjustable Rate Notes
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INDENTURE
Dated as of August 31, 1998
--------------------------------
The Bank of New York,
as Trustee
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CROSS REFERENCE TABLE1
TIA Indenture
Section Section
310 (a)(1) ...................................................... 6.11
(a)(2) ...................................................... 6.11
(a)(3) ...................................................... 6.10
(a)(4) ...................................................... N.A.2
(a)(5) ...................................................... 6.11
(b) ...................................................... 6.8; 6.11
(c) ...................................................... N.A.
311 (a) ...................................................... 6.12
(b) ...................................................... 6.12
(c) ...................................................... N.A.
312 (a) ...................................................... 7.1
(b) ...................................................... 7.2
(c) ...................................................... 7.2
(d) ...................................................... 7.4
313 (a) ...................................................... 7.4
(b)(1) ...................................................... 7.4
(b)(2) ...................................................... 11.5
(c) ...................................................... 7.4
(d) ...................................................... 7.3
314 (a) ...................................................... 3.9; 11.15
(b) ...................................................... 11.1
(c)(1) ...................................................... 11.1
(c)(2) ...................................................... 11.1
(c)(3) ...................................................... 11.1
(d) ...................................................... 11.1
(e) ...................................................... 11.1
(f) ...................................................... 11.1
315 (a) ...................................................... 6.1
(b) ...................................................... 6.5; 11.5
(c) ...................................................... 6.1
(d) ...................................................... 6.1
(e) ...................................................... 5.13
316 (a)(last sentence).............................................. 2.7
(a)(1) (A)...................................................... 5.11
(a)(1) (B)...................................................... 5.12
(a)(2) ...................................................... N.A.
(b) ...................................................... 5.7
(c) ...................................................... N.A
317 (a)(1) ...................................................... 5.3
(a)(2) ...................................................... 5.32
(b) ...................................................... 3.3
318 (a) ...................................................... 11.7
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1 Note: This Cross Reference Table shall not, for any purpose, be deemed to
be part of this Indenture.
2 N.A. means Not Applicable.
TABLE OF CONTENTS
Page
ARTICLE I
Definitions and Incorporation by Reference
SECTION 1.1 Definitions......................................................2
SECTION 1.2 Incorporation by Reference of Trust Indenture Act...............10
SECTION 1.3 Rules of Construction...........................................11
ARTICLE II
The Notes
SECTION 2.1 Form ...........................................................11
SECTION 2.2 Execution, Authentication and Delivery..........................12
SECTION 2.3 Temporary Notes.................................................12
SECTION 2.4 Registration; Registration of Transfer and Exchange.............12
SECTION 2.5 Mutilated, Destroyed, Lost or Stolen Notes......................14
SECTION 2.6 Persons Deemed Owner............................................15
SECTION 2.7 Payment of Principal and Interest; Defaulted Interest...........15
SECTION 2.8 Cancellation....................................................16
SECTION 2.9 Release of Collateral...........................................16
SECTION 2.10 Book-Entry Notes................................................16
SECTION 2.11 Notices to Clearing Agency......................................17
SECTION 2.12 Definitive Notes................................................17
ARTICLE III
Covenants
SECTION 3.1 Payment of Principal and Interest...............................18
SECTION 3.2 Maintenance of Office or Agency.................................18
SECTION 3.3 Money for Payments To Be Held in Trust..........................18
SECTION 3.4 Existence.......................................................20
SECTION 3.5 Protection of Trust Estate......................................20
SECTION 3.6 Opinions as to Trust Estate.....................................20
SECTION 3.7 Performance of Obligations; Servicing of the Loans..............21
SECTION 3.8 Negative Covenants..............................................22
SECTION 3.9 Annual Statement as to Compliance...............................23
SECTION 3.10 Issuer May Consolidate, Etc. Only on Certain Terms.............23
SECTION 3.11 Successor or Transferee........................................26
SECTION 3.12 No Other Business..............................................26
SECTION 3.13 No Borrowing...................................................26
SECTION 3.14 Servicer's Obligations.........................................26
SECTION 3.15 Guarantees, Loans, Advances and Other Liabilities..............26
SECTION 3.16 Capital Expenditures...........................................26
SECTION 3.17 Compliance with Laws...........................................26
SECTION 3.18 Restricted Payments............................................26
SECTION 3.19 Notice of Events of Default....................................27
SECTION 3.20 Further Instruments and Acts...................................27
SECTION 3.21 Income Tax Characterization....................................27
ARTICLE IIIA
Representations and Warranties
SECTION 3.1A Representations and Warranties of Issuer.......................28
ARTICLE IV
Satisfaction and Discharge
SECTION 4.1 Satisfaction and Discharge of Indenture.........................28
SECTION 4.2 Application of Trust Money......................................29
SECTION 4.3 Repayment of Moneys Held by Paying Agent........................29
SECTION 4.4 Notice..........................................................29
ARTICLE V
Remedies
SECTION 5.1 Events of Default..............................................29
SECTION 5.2 Acceleration of Maturity; Rescission and Annulment.............31
SECTION 5.3 Collection of Indebtedness and Suits for Enforcement by Trustee.32
SECTION 5.4 Remedies; Priorities...........................................35
SECTION 5.5 Optional Preservation of the Loans.............................36
SECTION 5.6 Limitation of Suits............................................36
SECTION 5.7 Unconditional Rights of Noteholders To Receive Principal and
Interest.......................................................37
SECTION 5.8 Restoration of Rights and Remedies.............................37
SECTION 5.9 Rights and Remedies Cumulative.................................37
SECTION 5.10 Delay or Omission Not a Waiver.................................38
SECTION 5.11 Control by Noteholders.........................................38
SECTION 5.12 Waiver of Past Defaults........................................38
SECTION 5.13 Undertaking for Costs..........................................39
SECTION 5.14 Waiver of Stay or Extension Laws...............................39
SECTION 5.15 Action on Notes................................................39
SECTION 5.16 Performance and Enforcement of Certain Obligations.............39
ARTICLE VI
The Trustee
SECTION 6.1 Duties of Trustee..............................................40
SECTION 6.2 Rights of Trustee..............................................42
SECTION 6.3 Individual Rights of Trustee...................................43
SECTION 6.4 Trustee's Disclaimer...........................................43
SECTION 6.5 Notice of Defaults.............................................43
SECTION 6.6 Reports by Trustee to Holders..................................43
SECTION 6.7 Compensation and Indemnity.....................................43
SECTION 6.8 Replacement of Trustee.........................................44
SECTION 6.9 Successor Trustee by Merger....................................46
SECTION 6.10 Appointment of Co-Trustee or Separate Trustee..................46
SECTION 6.11 Eligibility; Disqualification..................................47
SECTION 6.12 Preferential Collection of Claims Against Issuer...............47
SECTION 6.13 Appointment of Custodians......................................47
SECTION 6.14 Executing Basic Documents......................................48
ARTICLE VII
Noteholders' Lists and Reports
SECTION 7.1 Issuer To Furnish Trustee Names and Addresses of Noteholders....48
SECTION 7.2 Preservation of Information; Communications to Noteholders......48
SECTION 7.3 Reports by Issuer...............................................49
SECTION 7.4 Reports by Trustee..............................................49
ARTICLE VIII
Accounts, Disbursements and Releases
SECTION 8.1 Collection of Money.............................................50
SECTION 8.2 Trust Accounts..................................................50
SECTION 8.3 General Provisions Regarding Accounts...........................50
SECTION 8.4 Release of Trust Estate.........................................51
SECTION 8.5 Opinion of Counsel..............................................51
ARTICLE IX
Supplemental Indentures
SECTION 9.1 Supplemental Indentures without Consent of Noteholders..........52
SECTION 9.2 Supplemental Indentures with Consent of Noteholders.............53
SECTION 9.3 Execution of Supplemental Indentures............................55
SECTION 9.4 Effect of Supplemental Indenture................................55
SECTION 9.5 Conformity with Trust Indenture Act.............................55
SECTION 9.6 Reference in Notes to Supplemental Indentures...................55
ARTICLE X
Redemption of Notes
SECTION 10.1 Redemption.....................................................55
SECTION 10.2 Form of Redemption Notice......................................56
SECTION 10.3 Notes Payable on Redemption Date...............................57
ARTICLE XI
Miscellaneous
SECTION 11.1 Compliance Certificates and Opinions, etc......................57
SECTION 11.2 Form of Documents Delivered to Trustee.........................59
SECTION 11.3 Acts of Noteholders............................................59
SECTION 11.4 Notices, etc., to Trustee, Issuer and Rating Agencies..........60
SECTION 11.5 Notices to Noteholders; Waiver.................................61
SECTION 11.6 Alternate Payment and Notice Provisions........................61
SECTION 11.7 Conflict with Trust Indenture Act..............................61
SECTION 11.8 Effect of Headings and Table of Contents.......................62
SECTION 11.9 Successors and Assigns.........................................62
SECTION 11.10 Separability..................................................62
SECTION 11.11 Benefits of Indenture.........................................62
SECTION 11.12 Legal Holidays................................................62
SECTION 11.13 Governing Law.................................................62
SECTION 11.14 Counterparts..................................................62
SECTION 11.15 Recording of Indenture........................................62
SECTION 11.16 Trust Obligation..............................................63
SECTION 11.17 No Petition...................................................63
SECTION 11.18 Inspection....................................................63
SECTION 11.19 Usury .......................................................63
Testimonium, Signatures and Seals
Schedule I Auction Procedures
Exhibit A Schedule of Loans
Exhibit B Form of Class A Note
Exhibit C Form of Custodial Agreement
INDENTURE dated as of August 31, 1998, between THE MONEY STORE TRUST
1998-C, a Delaware business trust (the "Issuer"), and The Bank of New York, a
New York banking corporation, as trustee and not in its individual capacity (the
"Trustee").
Each party agrees as follows for the benefit of the other party and for the
Holder of Class AF-1 Adjustable Rate Notes (the "Class AF-1 Notes"); Class AF-2
Auction Rate Notes (the "Class AF-2 Notes and, collectively with the Class AF-1
Notes, the "Class AF Notes"); and Class AV Adjustable Rate Notes (the "Class AV
Notes," and together with the Class AF-1 Notes and Class AF-2 Notes, the
"Notes"):
GRANTING CLAUSE
The Issuer hereby Grants to the Trustee with respect to all Loans for the
benefit of the Holders of the Notes, a security interest in and to all of the
Issuer's right, title and interest in and to: (a) each Loan identified in the
Loan Schedule delivered by the Issuer on the Closing Date; (b) the principal
collected and interest accrued on each such Loan after the Cut-Off Date; (c) the
principal and interest received on such Loan on or prior to the Cut-Off Date
that is due after the CutOff Date; (d) all prepayments, proceeds of foreclosure
proceedings, insurance proceeds, investment income respecting the foregoing, (e)
any Mortgaged Property which becomes an REO Property; (f) the Issuer's rights
and benefits, but none of its obligations or burdens, under the Sale and
Servicing Agreement and the Rate Agreement; (g) all items contained in each
Indenture Trustee's Loan File; (h) all funds on deposit in any account
maintained by the Owner Trustee or the Servicer on behalf of the Issuer; and (i)
all present and future claims, demands, causes and chooses 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, 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 Trustee, as Trustee on behalf of the Holders of the Notes, acknowledges
such Grant, accepts the trusts under this Indenture in accordance with the
provisions of this Indenture and agrees to perform its duties required in this
Indenture according to customary industry practice to the end that the interests
of the Holders of the Notes may be adequately and effectively protected. The
Trustee also acknowledges the pledge to it of the Spread Account by First Union
National Bank, as Spread Account Depositor under the Spread Account Agreement
dated as of September 29, 1998 between the Trustee and the Spread Account
Depositor and the Trustee hereby agrees to exercise its rights under the Spread
Account Agreement and its rights to the Spread Account for the benefit of the
Noteholders and the Note Insurer.
ARTICLE I
DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.1 DEFINITIONS. Except as otherwise specified herein, the
following terms have the respective meanings set forth below for all purposes of
this Indenture. "ACT" has the meaning specified in Section 11.3(a).
"AFFILIATE" means, with respect to any specified Person, any other
Person controlling or controlled by or under common control with such specified
Person. For the purposes of this definition, "control" when used with respect to
any specified Person means the power to direct the management and policies of
such Person, directly or indirectly, whether through the ownership of voting
securities, by contract or otherwise; and the terms "controlling" and
"controlled" have meanings correlative to the foregoing.
"AUCTION PROCEDURES" means the procedures set forth in Schedule I to
this Indenture by which the Auction Rate is determined for the Class AF-2 Notes.
"AUCTION RATE" means the rate of interest per annum that results from
implementation of the Auction Procedures.
"AUTHORIZED OFFICER" means, with respect to the Issuer and the
Servicer, any officer or agent acting under a power of attorney of the Owner
Trustee or the Servicer, as applicable, who is authorized to act for the Owner
Trustee or the Servicer, as applicable, in matters relating to the Issuer and
who is identified on the list of Authorized Officers delivered by each of the
Owner Trustee and the Servicer to the Trustee on the Closing Date (as such list
may be modified or supplemented from time to time thereafter).
"BASIC DOCUMENTS" means the Certificate of Trust, the Trust Agreement,
the Sale and Servicing Agreement, this Indenture, the Note Depository
Agreements, the Insurance Agreement, the Spread Account Agreement and other
documents and certificates delivered in connection therewith.
"BOOK ENTRY NOTES" means a beneficial interest in the Notes, ownership
and transfers of which shall be made through book entries by a Clearing Agency
as described in Section 2.10.
"BUSINESS DAY" means any day other than (i) a Saturday or a Sunday or
(ii) a day on which banking institutions in the States of California, New York,
North Carolina or Delaware are required or authorized by law to be closed.
"CERTIFICATE OF TRUST" means the certificate of trust of the Issuer
substantially in the form of Exhibit B to the Trust Agreement.
"CLASS AF NOTES" means, collectively, the Class AF-1 Notes and the
Class AF-2 Notes.
"CLASS AF-1 NOTES" means the Class AF-1 Adjustable Rate Notes,
substantially in the form of Exhibit B.
"CLASS AF-1 REMITTANCE RATE" has the meaning set forth in the Sale and
Servicing Agreement.
"CLASS AF-2 NOTES" means the Class AF-2 Auction Rate Notes,
substantially in the form of Exhibit B.
"CLASS AF-2 REMITTANCE RATE" has the meaning set forth in the Sale and
Servicing Agreement.
"CLASS AV NOTES" means the Class AV Adjustable Rate Notes,
substantially in the form of Exhibit B.
"CLASS AV REMITTANCE RATE" has the meaning set forth in the Sale and
Servicing Agreement. The Class AV Remittance Rate shall be determined in
accordance with the Auction Procedures attached hereto as Schedule I.
"CLEARING AGENCY" means an organization registered as a "clearing
agency" pursuant to Section 17A of the Exchange Act.
"CLEARING AGENCY PARTICIPANT" means a broker, dealer, bank, other
financial institution or other Person for whom from time to time a Clearing
Agency effects book-entry transfers and pledges of securities deposited with the
Clearing Agency.
"CODE" means the Internal Revenue Code of 1986, as amended from time
to time, and Treasury Regulations promulgated thereunder.
"COLLATERAL" has the meaning specified in the Granting Clause of this
Indenture.
"CONTROLLING PARTY" means the Note Insurer, so long as no Insurer
Default shall have occurred and be continuing, and the Trustee, for so long as
an Insurer Default shall have occurred and be continuing.
"CORPORATE TRUST OFFICE" means the principal office of the Trustee at
which at any particular time its corporate trust business shall be principally
administered, which office at the date of the execution of this Indenture is
located at 000 Xxxxxxx Xxxxxx, 00xx Xxxxx Xxxx, Xxx Xxxx, Xxx Xxxx 00000,
Attention: Corporate Trust MBS Administration (Telephone: (000) 000-0000;
Facsimile: (000) 000-0000) or at such other address as the Trustee may designate
from time to time by notice to the Noteholders, the Servicer and the Issuer, or
the principal corporate trust office of any successor Trustee (the address of
which the successor Trustee will notify the Noteholders and the Issuer).
"DEFAULT" means any occurrence that is, or with notice or the lapse of
time or both would become, an Event of Default.
"DEFINITIVE NOTES" has the meaning specified in Section 2.10.
"EVENT OF DEFAULT" has the meaning specified in Section 5.1.
"EXCHANGE ACT" means the Securities Exchange Act of 1934, as amended.
"EXECUTIVE OFFICER" means, with respect to any corporation, the
President, any Executive Vice President, any Senior Vice President, any Vice
President, the Secretary or the Treasurer of such corporation; and with respect
to any partnership, any general partner thereof.
"GRANT" means mortgage, pledge, bargain, sell, warrant, alienate,
remise, release, convey, assign, transfer, create, xxxxx x xxxx upon and a
security interest in and right of set-off against, deposit, set over and confirm
pursuant to this Indenture. A Grant of the Collateral or of any other agreement
or instrument shall include all rights, powers and options (but none of the
obligations) of the Granting party thereunder, including the immediate and
continuing right to claim for, collect, receive and give receipt for principal
and interest payments in respect of the Collateral and all other moneys payable
thereunder, to give and receive notices and other communications, to make
waivers or other agreements, to exercise all rights and options, to bring
proceedings in the name of the Granting party or otherwise and generally to do
and receive anything that the Granting party is or may be entitled to do or
receive thereunder or with respect thereto.
"HOLDER" or "NOTEHOLDER" means the Person in whose name a Note is
registered on the Note Register.
"INDENTURE" means this Indenture as amended and supplemented from time
to time.
"INDEPENDENT" means, when used with respect to any specified Person,
that the person (a) is in fact independent of the Issuer, any other obligor upon
the Notes, the Representative 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 Representative or
any Affiliate of any of the foregoing Persons and (c) is not connected with the
Issuer, any such other obligor, the Representative or any Affiliate of any of
the foregoing Persons as an officer, employee, promoter, underwriter, trustee,
partner, director or Person performing similar functions.
"INDEPENDENT CERTIFICATE" means a certificate or opinion to be
delivered to the Trustee under the circumstances described in, and otherwise
complying with, the applicable requirements of Section 11.1, made by an
Independent appraiser or other expert appointed by an Issuer Order and approved
by the Trustee 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.
"INSURANCE AGREEMENT EVENT OF DEFAULT" has the meaning specified
therefor in the Insurance Agreement.
"INSURED PAYMENTS" has the meaning specified in the Note Policy.
"INSURER DEFAULT" means (i) the failure of the Note Insurer to make a
payment under the Note Policy in accordance with its terms or (ii) an Insolvency
Event (as defined in the Sale and Servicing Agreement) occurs and is continuing
with respect to the Note Insurer.
"INSURER ISSUER SECURED OBLIGATIONS" means all amounts and obligations
which the Issuer may at any time owe to or on behalf of the Note Insurer under
this Indenture, the Insurance Agreement or any other Basic Document.
"INTEREST RATE SERVICES AGREEMENT" means that certain Interest Rate
Services Agreement dated as of September 29, 1998 between the Indenture Trustee
and the Remarketing Agent, as amended or supplemented.
"ISSUER" means the party named as such in this Indenture 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" means a written order or request
signed in the name of the Issuer by any one of its Authorized Officers and
delivered to the Trustee.
"ISSUER SECURED OBLIGATIONS" means the Insurer Issuer Secured
Obligations and the Trustee Issuer Secured Obligations.
"ISSUER SECURED PARTIES" means each of the Trustee in respect of the
Trustee Issuer Secured Obligations and the Note Insurer in respect of the
Insurer Issuer Secured Obligations.
"LOAN SCHEDULE" means the listing of the Loans set forth in Exhibit A
(which Exhibit may be in the form of microfiche).
"NOTE" means a Class AF-1 Note, a Class AF-2 Note or a Class AV Note.
"NOTE DEPOSITORY AGREEMENT" means the agreement among the Issuer, the
Trustee, the Servicer and The Depository Trust Company, as the initial Clearing
Agency, dated one Business Day prior to Closing Date.
"NOTE OWNER" means, with respect to a Book-Entry Note, the person who
is the 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).
"NOTE POLICIES" means the note guaranty insurance policies issued by
the Note Insurer with respect to the Notes.
"NOTE REGISTER" and "NOTE REGISTRAR" have the respective meanings
specified in Section 2.4.
"NOTES" means the collective reference to the Class AF-1 Notes, the
Class AF-2 Notes and the Class AV Notes.
"OFFICER'S CERTIFICATE" means a certificate signed by any Authorized
Officer of the Issuer, under the circumstances described in, and otherwise
complying with, the applicable requirements of Section 11.1 and TIA ss. 314, and
delivered to the 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.
"OPINION OF COUNSEL" means one or more written opinions of counsel who
may, except as otherwise expressly provided in this Indenture, be employees of
or counsel to the Issuer and who shall be satisfactory to the Trustee and the
Note Insurer, and which opinion or opinions shall be addressed to the Trustee as
Trustee and the Note Insurer, shall comply with any applicable requirements of
Section 11.1, and shall be in form and substance satisfactory to the Trustee and
the Note Insurer.
"ORIGINATORS" shall have the meaning ascribed to such term in the Sale
and Servicing Agreement.
"OUTSTANDING" means, as of the date of determination, all Notes
theretofore authenticated and delivered under this Indenture except:
(i) Notes theretofore canceled 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 been theretofore deposited with the 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
therefor, satisfactory to the Trustee); and
(iii) Notes in exchange for or in lieu of other Notes which have
been authenticated and delivered pursuant to this Indenture unless
proof satisfactory to the Trustee is presented that any such Notes are
held by a bona fide purchaser; PROVIDED HOWEVER, that Notes which have
been paid with proceeds of a Note Policy shall continue to remain
Outstanding for purposes of this Indenture until the Note Insurer has
been paid as subrogee hereunder or reimbursed pursuant to the
Insurance Agreement, and the Note Insurer shall be deemed to be the
Holder thereof to the extent of any payments thereon made by the Note
Insurer; PROVIDED, FURTHER, that in determining whether the Holders of
the requisite Outstanding Amount of the 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 Representative or any Affiliate of any of
the foregoing Persons shall be disregarded and deemed not to be
Outstanding, except that, in determining whether the Trustee shall be
protected in relying upon any such request, demand, authorization,
direction, notice, consent or waiver, only Notes that a Responsible
Officer of the Trustee either actually knows to be so owned or has
received written notice thereof shall be so disregarded. Notes so
owned that have been pledged in good faith may be regarded as
Outstanding if the pledgee establishes to the satisfaction of the
Trustee the pledgee's right so to act with respect to such Notes and
that the pledgee is not the Issuer, any other obligor upon the Notes,
the Representative or any Affiliate of any of the foregoing Persons.
"OUTSTANDING AMOUNT" means the aggregate principal amount of all Notes
or class of Notes, as applicable, Outstanding at the date of determination.
"OWNER TRUSTEE" shall have the meaning given to such term in the Trust
Agreement.
"PAYING AGENT" means the Trustee or any other Person acceptable to the
Note Insurer that meets the eligibility standards for the Trustee specified in
Section 6.11 and is authorized by the Issuer to make the payments to and
distributions from the Principal and Interest Account and the Pool I Note
Distribution Account and Pool II Note Distribution Account, including payment of
principal of or interest on the Notes on behalf of the Issuer.
"PAYMENT DATE" means a Remittance Date.
"PREDECESSOR NOTE" means, with respect to any particular Note, every
previous Note evidencing all or a portion of the same debt as that evidenced by
such particular Note; and, for the purpose of this definition, any Note
authenticated and delivered under Section 2.5 in lieu of a mutilated, lost,
destroyed or stolen Note shall be deemed to evidence the same debt as the
mutilated, lost, destroyed or stolen Note.
"PROCEEDING" means any suit in equity, action at law or other judicial
or administrative proceeding.
"RECORD DATE" means, with respect to a Remittance Date or Redemption
Date, the close of business on the last day of the month immediately preceding
the month of the related Remittance Date or Redemption Date.
"REDEMPTION DATE" means (a) in the case of a redemption of the Notes
pursuant to Section 10.1(a) or a payment to Noteholders pursuant to Section
10.1(b), the Remittance Date specified by the Servicer or the Issuer pursuant to
Section 10.1(a) or (b) as applicable.
"REDEMPTION PRICE" means (a) in the case of a redemption of the Notes
pursuant to Section 10.1(a), an amount equal to the unpaid principal amount of
the then Outstanding Notes plus accrued and unpaid interest thereon to but
excluding the Redemption Date and any amounts then owing to the Note Insurer, or
(b) in the case of a payment made to Noteholders pursuant to Section 10.1(b),
the amount on deposit in the applicable Note Distribution Account, but not in
excess of the amount specified in clause (a) above.
"REMARKETING AGENT" means First Union Capital Markets, a division of
Wheat First Securities, Inc., and its successors and assigns under the Interest
Rate Services Agreement.
"REMITTANCE RATE" means with respect to (i) the Class AF-1 Notes, the
Class AF-1 Remittance Rate, (ii) the Class AF-2 Notes, the Class AF-2 Remittance
Rate and (iii) the Class AV Notes, the Class AV Remittance Rate.
"REPRESENTATIVE" means The Money Store Inc., a New Jersey corporation,
as Representative of the Originators under the Sale and Servicing Agreement and
the Trust Agreement, and its successors and assigns as Representative
thereunder.
"RESPONSIBLE OFFICER" means, with respect to the Trustee, any officer
(a) assigned to the Corporate Trust Department of the Trustee, including any
Vice President, Assistant Vice President, any Assistant Secretary, any trust
officer or any other officer of the Trustee customarily performing functions
similar to those performed by any of the above designated officers and also,
with respect to a particular matter, any other officer to whom such matter is
referred because of such officer's knowledge of and familiarity with the
particular subject and (b) who shall have direct responsibility for the
administration of this Indenture.
"SALE AND SERVICING AGREEMENT" means the Sale and Servicing Agreement
dated as of August 31, 1998, among the Issuer, the Representative and Servicer,
and the Originators named therein, as the same may be amended or supplemented
from time to time.
"SPECIAL INTEREST" shall have the meaning given to such term in the
Trust Agreement.
"STATE" means any one of the 50 states of the United States of America
or the District of Columbia.
"SUCCESSOR SERVICER" has the meaning specified in Section 3.7(e).
"TERMINATION DATE" means the latest of (i) the expiration of the Note
Policy and the return of the Note Policy to the Note Insurer for cancellation,
(ii) the date on which the Note Insurer shall have received payment and
performance of all Insurer Issuer Secured Obligations and (iii) the date on
which the Trustee shall have received payment and performance of all Trustee
Issuer Secured Obligations.
"TRUST AGREEMENT" means the Trust Agreement, dated as of August 31,
1998, among the Originators and Chase Manhattan Bank Delaware, as Owner Trustee.
"TRUST ESTATE" means all money, instruments, rights and other property
that are subject or intended to be subject to the lien and security interest of
this Indenture for the benefit of the Noteholders and the Note Insurer
(including all property and interests Granted to the Trustee), including all
proceeds thereof.
"TRUST INDENTURE ACT" or "TIA" means the Trust Indenture Act of 1939
as in force on the date hereof, unless otherwise specifically provided.
"TRUSTEE" means The Bank of New York, a New York banking corporation,
not in its individual capacity but as trustee under this Indenture, or any
successor trustee under this Indenture.
"TRUSTEE ISSUER SECURED OBLIGATIONS" means all amounts and obligations
which the Issuer may at any time owe to or on behalf of the Trustee for the
benefit of the Noteholders and the Note Insurer under this Indenture or the
Notes. "UCC" means, unless the context otherwise requires, the Uniform
Commercial Code, as in effect in the relevant jurisdiction, as amended from time
to time.
(a) Except as otherwise specified herein, the following terms have the
respective meanings set forth in the Sale and Servicing Agreement, amended or
supplemented from time to time, for all purposes of this Indenture, and the
definitions of such terms are equally applicable both to the singular and plural
forms of such terms: Section of Sale and
TERM SERVICING AGREEMENT
Compensating Interest.................................. Section 1.01
Certificateholders..................................... Section 1.01
Closing Date .......................................... Section 1.01
Cut-Off Date........................................... Section 1.01
Deleted Loan........................................... Section 1.01
Due Period............................................. Section 1.01
Final Maturity Date.................................... Section 1.01
Insurance Agreement.................................... Section 1.01
Liquidated Loan........................................ Section 1.01
Monthly Advances....................................... Section 1.01
Note Depository Agreements............................. Section 1.01
Loan................................................... Section 1.01
Mortgaged Property..................................... Section 1.01
Note Distribution Account.............................. Section 1.01
Note Insurer........................................... Section 1.01
Original Principal Balance............................. Section 1.01
Originator............................................. Section 1.01
Permitted Instruments.................................. Section 1.01
Person................................................. Section 1.01
Pool Available Remittance Amount....................... Section 1.01
Principal and Interest Account......................... Section 1.01
Rate Agreement......................................... Section 1.01
Rating Agency ......................................... Section 1.01
Rating Agency Condition................................ Section 1.01
Remittance Date........................................ Section 1.01
REO Property........................................... Section 1.01
Servicer Default....................................... Section 1.01
Servicer............................................... Section 1.01
Trust Accounts......................................... Section 1.01
(b) Capitalized terms used herein and not otherwise defined herein or
in the Sale and Servicing Agreement have the meanings assigned to them in the
Trust Agreement.
SECTION 1.2 INCORPORATION BY REFERENCE OF TRUST INDENTURE ACT.
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.
"indenture to be qualified" means this Indenture.
"indenture trustee" or "institutional trustee" means the Trustee.
"obligor" on the indenture securities means the Issuer and any other
obligor on the indenture securities.
All other TIA terms used in this Indenture that are defined by the
TIA, defined by TIA reference to another statute or defined by Commission rule
have the meaning assigned to them by such definitions.
SECTION 1.3 RULES OF CONSTRUCTION. Unless the context otherwise
requires:
(i) a term has the meaning assigned to it;
(ii) an accounting term not otherwise defined has the meaning
assigned to it in accordance with generally accepted accounting
principles as in effect from time to time;
(iii) "or" is not exclusive;
(iv) "including" means including without limitation; and
(v) words in the singular include the plural and words in the
plural include the singular.
ARTICLE II
THE NOTES
SECTION 2.1 FORM. Each class of Notes, together with the
Trustee's certificate of authentication, shall be in substantially the form set
forth in Exhibit B, with such appropriate insertions, omissions, substitutions
and other variations as are required or permitted by this Indenture and may have
such letters, numbers or other marks of identification and such legends or
endorsements placed thereon as may, consistently herewith, be determined by the
officers executing such Notes, as evidenced by their execution of the Notes. Any
portion of the text of any Note may be set forth on the reverse thereof, with an
appropriate reference thereto on the face of the Note.
The Definitive Notes shall be typewritten, printed, lithographed or
engraved or produced by any combination of these methods (with or without steel
engraved borders), all as determined by the 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 set forth in Exhibits B are part of the terms of this Indenture.
SECTION 2.2 EXECUTION, AUTHENTICATION AND DELIVERY. The Notes shall be
executed on behalf of the Issuer by any of its Authorized Officers. The
signature of any such Authorized Officer on the Notes may be manual or
facsimile.
Notes bearing the manual or facsimile signature of individuals who
were at any time Authorized Officers of the Issuer shall bind the Issuer,
notwithstanding that such individuals or any of them have ceased to hold such
offices prior to the authentication and delivery of such Notes or did not hold
such offices at the date of such Notes.
The Trustee shall upon receipt of the Note Policies and Issuer Order
authenticate and deliver Class AF-1 Notes for original issue in an aggregate
principal amount of $401,250,000, Class AF-2 Notes for original issue in an
aggregate principal amount of $133,750,000 and Class AV Notes for original issue
in an aggregate principal amount of $360,000,000. The aggregate principal amount
of Notes outstanding at any time may not exceed such amounts except as provided
in Section 2.5.
Each Note shall be dated the date of its authentication. The Notes
shall be issuable as registered Notes in the minimum denomination of $25,000 and
in integral multiples of $1,000 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 Trustee by the manual signature of one of its authorized
signatories, and such certificate upon any Note shall be conclusive evidence,
and the only evidence, that such Note has been duly authenticated and delivered
hereunder.
SECTION 2.3 TEMPORARY NOTES. Pending the preparation of Definitive
Notes, the Issuer may execute, and upon receipt of an Issuer Order the Trustee
shall authenticate and deliver, temporary Notes which are printed, lithographed,
typewritten, mimeographed or otherwise produced, of the tenor of the Definitive
Notes in lieu of which they are issued and with such variations not inconsistent
with the terms of this Indenture as the officers executing such Notes may
determine, as evidenced by their execution of such Notes.
If temporary Notes are issued, the Issuer will cause Definitive Notes
to be prepared without unreasonable delay. After the preparation of Definitive
Notes, the temporary Notes shall be exchangeable for Definitive Notes upon
surrender of the temporary Notes at the office or agency of the Issuer to be
maintained as provided in Section 3.2, without charge to the Holder. Upon
surrender for cancellation of any one or more temporary Notes, the Issuer shall
execute and the Trustee shall authenticate and deliver in exchange therefor a
like principal amount of Definitive Notes of authorized denominations. Until so
exchanged, the temporary Notes shall in all respects be entitled to the same
benefits under this Indenture as Definitive Notes.
SECTION 2.4 REGISTRATION; REGISTRATION OF TRANSFER AND EXCHANGE. The
Issuer shall cause to be kept a register (the "Note Register") in which, subject
to such reasonable regulations as it may prescribe, the Issuer shall provide for
the registration of Notes and the registration of transfers of Notes. The
Trustee shall be "Note Registrar" for the purpose of registering Notes and
transfers of Notes as herein provided. The Note Registrar may resign as such
only upon written notice delivered to an Authorized Officer of the Issuer, and
upon any resignation of any Note Registrar, the Issuer shall promptly appoint a
successor acceptable to the Note Insurer or, if it elects not to make such an
appointment, assume the duties of Note Registrar.
If a Person other than the Trustee is appointed by the Issuer as Note
Registrar, the Issuer will give the Trustee and the Note Insurer prompt written
notice of the appointment of such Note Registrar and of the location, and, upon
one of its Authorized Officers receiving written notice thereof, any change in
the location, of the Note Register, and the 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 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 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 3.2, if the
applicable requirements of Article 8 of the UCC are met the Issuer shall execute
and upon its request the Trustee shall authenticate and the Noteholder shall
obtain from the Trustee, in the name of the designated transferee or
transferees, one or more new Notes, in any authorized denominations, of the same
class and a like aggregate principal amount.
At the option of the Holder, Notes may be exchanged for other Notes in
any authorized denominations, of the same class and a like aggregate principal
amount, upon surrender of the Notes to be exchanged at such office or agency.
Whenever any Notes are so surrendered for exchange, if the applicable
requirements of Article 8 of the UCC are met the Issuer shall execute and upon
its request the Trustee shall authenticate and the Noteholder shall obtain from
the Trustee, the Notes which the Noteholder making the exchange is entitled to
receive.
All Notes issued upon any registration of transfer or exchange of
Notes shall be the valid obligations of the Issuer, evidencing the same debt,
and entitled to the same benefits under this Indenture, as the Notes surrendered
upon such registration of transfer or exchange.
Every Note presented or surrendered for registration of transfer or
exchange shall be (i) duly endorsed by, or be accompanied by a written
instrument of transfer in form satisfactory to the 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 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, and (ii) accompanied by such other documents as the Trustee may
require.
No service charge shall be made to a Holder 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 Section 2.3 or 9.6 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 redemption or of any Note for a period of 15
days preceding the due date for any payment with respect to the Note.
SECTION 2.5 MUTILATED, DESTROYED, LOST OR STOLEN NOTES. If (i) any
mutilated Note is surrendered to the Trustee, or the Trustee receives evidence
to its satisfaction of the destruction, loss or theft of any Note, and (ii)
there is delivered to the Trustee and the Note Insurer (unless an Insurer
Default shall have occurred and be continuing) such security or indemnity as may
be required by it to hold the Issuer, the Note Insurer and the Trustee harmless,
then, in the absence of notice to the Issuer, the Note Registrar or the Trustee
that such Note has been acquired by a bona fide purchaser, and provided that the
applicable requirements of Article 8 of the UCC are met, the Issuer shall
execute and upon its request the Trustee shall authenticate and deliver, in
exchange for or in lieu of any such mutilated, destroyed, lost or stolen Note, a
replacement Note; PROVIDED, HOWEVER, that if any such destroyed, lost or stolen
Note, but not a mutilated Note, shall have become or within seven days shall be
due and payable, or shall have been called for redemption, instead of issuing a
replacement Note, the Issuer may pay such destroyed, lost or stolen Note when so
due or payable or upon the Redemption Date without surrender thereof. If, after
the delivery of such replacement Note or payment of a destroyed, lost or stolen
Note pursuant to the proviso to the preceding sentence, a bona fide purchaser of
the original Note in lieu of which such replacement Note was issued presents for
payment such original Note, the Issuer, the Note Insurer and the Trustee shall
be entitled to recover such replacement Note (or such payment) from the Person
to whom it was delivered or any Person taking such replacement Note from such
Person to whom such replacement Note was delivered or any assignee of such
Person, except a bona fide purchaser, and shall be entitled to recover upon the
security or indemnity provided therefor to the extent of any loss, damage, cost
or expense incurred by the Issuer or the 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 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 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.
SECTION 2.6 PERSONS DEEMED OWNER. Prior to due presentment for
registration of transfer of any Note, the Issuer, the Trustee and any agent of
the Issuer or the Trustee and the Note Insurer may treat the Person in whose
name any Note is registered (as of the day of determination) as the owner of
such Note for the purpose of receiving payments of principal of and interest, if
any, on such Note and for all other purposes whatsoever, whether or not such
Note be overdue, and none of the Issuer, the Trustee, the Note Insurer nor any
agent of the Issuer or the Trustee shall be affected by notice to the contrary.
SECTION 2.7 PAYMENT OF PRINCIPAL AND INTEREST; DEFAULTED INTEREST. (a)
The Notes shall accrue interest as provided in the respective Note and the Sale
and Servicing Agreement and such interest shall be payable on each Remittance
Date as specified therein. Any installment of interest or principal, if any,
payable on any Note which is punctually paid or duly provided for by the Issuer
on the applicable Remittance Date shall be paid to the Person in whose name such
Note (or one or more Predecessor Notes) is registered on the Record Date, 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, 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 Remittance Date or on the Final Maturity Date (and except for
the Redemption Price for any Note called for redemption pursuant to Section
10.1(a)) which shall be payable as provided below. The funds represented by any
such checks returned undelivered shall be held in accordance with Section 3.3.
(b) The principal of each Note shall be payable in installments on
each Remittance Date as set forth in the Sale and Servicing Agreement.
Notwithstanding the foregoing, the entire unpaid principal amount of the Notes
shall be due and payable, if not previously paid, on the date on which an Event
of Default shall have occurred and be continuing, if the Trustee at the
direction of the Note Insurer or the Holders of the Notes representing not less
than a majority of the Outstanding Amount of the Notes with the prior written
consent of the Note Insurer have declared the Notes to be immediately due and
payable in the manner provided in Section 5.2. In such event, all principal
payments on the Notes shall be made pro rata to the Noteholders of such Class
entitled thereto from the Loans of the respective Pool. The Trustee shall notify
the Person in whose name a Note is registered at the close of business on the
Record Date preceding the Remittance 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
Remittance Date and shall specify that such final installment will be payable
only upon presentation and surrender of such Note and shall specify the place
where such Note may be presented and surrendered for payment of such
installment. Notices in connection with redemptions of Notes shall be mailed to
Noteholders and the Note Insurer as provided in Section 10.2.
(c) [Reserved]
(d) If the Issuer defaults in a payment of interest on the Notes, the
Issuer shall pay defaulted interest (plus interest on such defaulted interest to
the extent lawful) at the applicable Remittance Rate in any lawful manner. The
Issuer may pay such defaulted interest to the Persons who are Noteholders on a
subsequent special record date, which date shall be at least five Business Days
prior to the payment date. The Issuer shall fix or cause to be fixed any such
special record date and payment date, and, at least 15 days before any such
special record date, the Issuer shall mail to each Noteholder, the Note Insurer
and the Trustee a notice that states the special record date, the payment date
and the amount of defaulted interest to be paid (which Noteholder will be the
Note Insurer to the extent an Insured Payment is made pursuant to the Note
Insurance Policies).
SECTION 2.8 CANCELLATION. All Notes surrendered for payment,
registration of transfer, exchange or redemption shall, if surrendered to any
Person other than the Trustee, be delivered to the Trustee and shall be promptly
canceled by the Trustee. The Issuer may at any time deliver to the Trustee for
cancellation any Notes previously authenticated and delivered hereunder which
the Issuer may have acquired in any manner whatsoever, and all Notes so
delivered shall be promptly canceled by the 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 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 returned to it; PROVIDED that such Issuer
Order is timely and the Notes have not been previously disposed of by the
Trustee.
SECTION 2.9 RELEASE OF COLLATERAL. Subject to Section 11.1, the
Trustee shall release property from the lien of this Indenture only upon receipt
of an Issuer Request accompanied by an Officer's Certificate, an Opinion of
Counsel and Independent Certificates in accordance with TIAss.314(c) and
314(d)(l) or an Opinion of Counsel in lieu of such Independent Certificates to
the effect that the TIA does not require any such Independent Certificates.
SECTION 2.10 BOOK-ENTRY NOTES. The Notes, upon original issuance, will
be issued in the form of typewritten Notes representing the Book-Entry Notes, to
be delivered to The Bank of New York, as agent for The Depository Trust Company,
the initial Clearing Agency, by, or on behalf of, the Issuer. Such Notes shall
initially be registered 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. Unless and until definitive, fully registered Notes
(the "Definitive Notes") have been issued to Note Owners pursuant to Section
2.12:
(i) the provisions of this Section shall be in full force and
effect;
(ii) the Note Registrar and the 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;
(iii) to the extent that the provisions of this Section conflict
with any other provisions of this Indenture, the provisions of this
Section shall control;
(iv) 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, 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
(v) whenever this Indenture requires or permits actions to be
taken based upon instructions or directions of Holders of Notes
evidencing a specified percentage of the Outstanding Amount of the
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 Trustee.
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 Note Owners pursuant to Section
2.12, the 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 the Note Owners.
SECTION 2.12 DEFINITIVE NOTES. If (i) the Servicer advises the Trustee
in writing that the Clearing Agency is no longer willing or able to properly
discharge its responsibilities with respect to the Notes, and the Servicer is
unable to locate a qualified successor, (ii) the Servicer at its option advises
the 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, Note
Owners representing beneficial interests aggregating at least a majority of the
Outstanding Amount of the Notes, with the prior written consent of the Note
Insurer, advise the Trustee through 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 the Note Owners, then the Clearing Agency shall notify all
Note Owners, the Note Insurer and the Trustee of the occurrence of any such
event and of the availability of Definitive Notes to Note Owners requesting the
same. Upon surrender to the Trustee of the typewritten Note or Notes
representing the Book-Entry Notes by the Clearing Agency, accompanied by
registration instructions, the Issuer shall execute and the Trustee shall
authenticate the Definitive Notes in accordance with the instructions of the
Clearing Agency. None of the Issuer, the Note Registrar or the Trustee shall be
liable for any delay in delivery of such instructions and may conclusively rely
on, and shall be protected in relying on, such instructions. Upon the issuance
of Definitive Notes, the Trustee shall recognize the Holders of the Definitive
Notes as Noteholders.
ARTICLE III
COVENANTS
SECTION 3.1 PAYMENT OF PRINCIPAL AND INTEREST. The Issuer will duly
and punctually pay the principal of and interest on the Notes in accordance with
the terms of the Notes and this Indenture. Without limiting the foregoing,
subject to Section 8.2(c), the Issuer will cause to be distributed on a
Remittance Date pursuant to the Sale and Servicing Agreement (i) all amounts on
deposit in the Pool I Note Distribution Account for the benefit of the Class AF
Notes to the Class AF Noteholders and (ii) all amounts on deposit in the Pool II
Note Distribution Account for the benefit of the Class AV Notes to the Class AV
Noteholders. 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.
SECTION 3.2 MAINTENANCE OF OFFICE OR AGENCY. The Issuer will maintain
in the Borough of Manhattan, The City of New York, 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 Trustee to
serve as its agent for the foregoing purposes. The Issuer will give prompt
written notice to the 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 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 Trustee as its
agent to receive all such surrenders, notices and demands.
SECTION 3.3 MONEY FOR PAYMENTS TO BE HELD IN TRUST. As provided in
Sections 8.2(a) and (b), all payments of amounts due and payable with respect to
any Notes that are to be made from amounts withdrawn from the Principal and
Interest Account and the Note Distribution Account pursuant to Section 8.2(c)
shall be made on behalf of the Issuer by the Trustee or by another Paying Agent,
and no amounts so withdrawn from the Principal and Interest Account and either
Note Distribution Account for payments of Notes shall be paid over to the Issuer
except as provided in this Section.
On or before each Remittance Date and Redemption Date, the Issuer
shall deposit or cause to be deposited in the Pool I Note Distribution Account
and Pool II Note Distribution Account an aggregate sum sufficient to pay the
amounts then becoming due under the Class AF Notes and Class AV Notes,
respectively, such sum to be held in trust for the benefit of the Persons
entitled thereto and (unless the Paying Agent is the Trustee) shall promptly
notify the Trustee of its action or failure so to act.
The Issuer will cause each Paying Agent other than the Trustee to
execute and deliver to the Trustee and the Note Insurer an instrument in which
such Paying Agent shall agree with the Trustee (and if the Trustee acts as
Paying Agent, it hereby so agrees), subject to the provisions of this Section,
that such Paying Agent will:
(i) hold all sums held by it for the payment of amounts due with
respect to the Notes in trust for the benefit of the Persons entitled
thereto until such sums shall be paid to such Persons or otherwise
disposed of as herein provided and pay such sums to such Persons as
herein provided;
(ii) give the Trustee notice of any default by the Issuer of
which it has actual knowledge (or any other obligor upon the Notes) in
the making of any payment required to be made with respect to the
Notes;
(iii) at any time during the continuance of any such default,
upon the written request of the Trustee, forthwith pay to the Trustee
all sums so held in trust by such Paying Agent;
(iv) immediately resign as a Paying Agent and forthwith pay to
the Trustee all sums held by it in trust for the payment of Notes if
at any time it ceases to meet the standards required to be met by a
Paying Agent at the time of its appointment; and (v) comply with all
requirements of the Code with respect to the withholding from any
payments made by it on any Notes of any applicable withholding taxes
imposed thereon and with respect to any applicable reporting
requirements in connection therewith.
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 Trustee all sums held in trust by
such Paying Agent, such sums to be held by the Trustee upon the same trusts as
those upon which the sums were held by such Paying Agent; and upon such a
payment by any Paying Agent to the Trustee, such Paying Agent shall be released
from all further liability with respect to such money.
Subject to applicable laws with respect to the escheat of funds, any
money held by the 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, 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 Trustee or such Paying Agent with respect to such trust money shall
thereupon cease; provided, however, that if such money or any portion thereof
had been previously deposited by the Note Insurer with the Trustee for the
payment of principal or interest on the Notes, to the extent any amounts are
owing to the Note Insurer, such amounts shall be paid promptly to the Note
Insurer upon receipt of a written request by the Note Insurer to such effect,
and PROVIDED, FURTHER, that the Trustee or such Paying Agent, before being
required to make any such repayment, shall at the expense of the Issuer cause to
be published once, in a newspaper published in the English language, customarily
published on each Business Day and of general circulation in the City of New
York, notice that such money remains unclaimed and that, after a date specified
therein, which shall not be less than 30 days from the date of such publication,
any unclaimed balance of such money then remaining will be repaid to the Issuer.
The Trustee shall also adopt and employ, at the expense 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 Trustee
or of any Paying Agent, at the last address of record for each such Holder).
SECTION 3.4 EXISTENCE. Except as otherwise permitted by the provisions
of Section 3.10, the Issuer will keep in full effect its existence, rights and
franchises as a business trust under the laws of the State of Delaware (unless
it becomes, or any successor Issuer hereunder is or becomes, organized under the
laws of any other state or of the United States of America, in which case the
Issuer will keep in full effect its existence, rights and franchises under the
laws of such other jurisdiction) and will obtain and preserve its qualification
to do business in each jurisdiction in which such qualification is or shall be
necessary to protect the validity and enforceability of this Indenture, the
Notes, the Collateral and each other instrument or agreement included in the
Trust Estate.
SECTION3.5 PROTECTION OF TRUST ESTATE. The Issuer will from time to
time prepare (or shall cause to be prepared), execute and deliver all such
supplements and amendments hereto and all such financing statements,
continuation statements, instruments of further assurance and other instruments,
and will take such other action necessary or advisable to:
(i) maintain or preserve the lien and security interest and the
priority thereof) of this Indenture or carry out more effectively the
purposes hereof;
(ii) perfect, publish notice of or protect the validity of any
Grant made or to be made by this Indenture;
(iii) enforce any of the Collateral; or
(iv) preserve and defend title to the Trust Estate and the rights
of the Trustee, the Note Insurer and the Noteholders in such Trust
Estate against the claims of all persons and parties.
The Issuer hereby designates the Trustee its agent and attorney-in-fact to
execute any financing statement, continuation statement or other instrument
prepared and delivered to the Trustee that are required to be executed pursuant
to this Section; it being understood that the Trustee has no duty to determine
whether any filing or recording is necessary hereunder.
SECTION 3.6 OPINIONS AS TO TRUST ESTATE. (a) On the Closing Date, the
Issuer shall furnish to the 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 and filing of this Indenture, any indentures
supplemental hereto, and any other requisite documents, and with respect to the
execution and filing of any financing statements and continuation statements, as
are necessary to perfect and make effective the lien and security interest of
this Indenture for the benefit of the Issuer Secured Parties and reciting the
details of such action, or stating that, in the opinion of such counsel, no such
action is necessary to make such lien and security interest effective.
(b) Within 120 days after the beginning of each calendar year,
beginning with the first calendar year beginning more than three months after
the Cut-Off Date, the Issuer shall furnish to the 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 are 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 January 30 in
the following calendar year.
SECTION 3.7 PERFORMANCE OF OBLIGATIONS; SERVICING OF THE 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 Trust Estate 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
ordered by any bankruptcy or other court or as expressly provided in this
Indenture, the Basic Documents or such other instrument or agreement.
(b) The Issuer may contract with other Persons acceptable to the Note
Insurer (so long as no Insurer Default shall have occurred and be continuing) to
assist it in performing its duties under this Indenture, and any performance of
such duties by a Person identified to the 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 Servicer and the Trust
Administrator, pursuant to the Sale and Servicing Agreement, to assist the
Issuer in performing its duties under this Indenture.
(c) The Issuer will punctually perform and observe all of its
obligations and agreements contained in this Indenture, the Basic Documents and
in the instruments and agreements included in the Trust Estate, including but
not limited to preparing (or causing to be prepared) and filing (or causing to
be filed) all UCC financing statements and continuation statements required to
be filed by the terms of this Indenture and the Sale and Servicing Agreement in
accordance with and within the time periods provided for herein and therein.
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 Trustee, the Note Insurer or the Holders of
at least a majority of the Outstanding Amount of the Notes.
(d) If the Issuer shall have knowledge of the occurrence of a Servicer
Default under the Sale and Servicing Agreement, the Issuer shall promptly notify
the Trustee, the Note Insurer and the Rating Agencies thereof in accordance with
Section 11.4, and shall specify in such notice the action, if any, the Issuer is
taking in respect of such default. If a Servicer Default of which the Issuer has
knowledge shall arise from the failure of the Servicer to perform any of its
duties or obligations under the Sale and Servicing Agreement with respect to the
Loans, the Issuer shall take all reasonable steps available to it to remedy such
failure.
(e) Upon any termination of the Servicer's rights and powers pursuant
to Section 10.01 of the Sale and Servicing Agreement or if an Insurer Default
shall have occurred, the Issuer shall promptly notify the Trustee. As soon as a
successor to the Servicer (other than the Trustee) is appointed pursuant to
Section 10.02 of the Sale and Servicing Agreement, the Issuer shall notify the
Trustee of such appointment, specifying in such notice the name and address of
such successor Servicer or Claims Administrator, as the case may be.
(f) Upon an Authorized Officer of the Issuer acquiring actual
knowledge of any termination of the Servicer's rights and powers pursuant to the
Sale and Servicing Agreement, the Issuer shall promptly notify the Trustee and
the Note Insurer. As soon as a Successor Servicer (other than the Trustee) is
appointed, the Issuer shall notify the Trustee of such appointment, specifying
in such notice the name and address of such Successor Servicer.
(g) Without derogating from the absolute nature of the assignment
granted to the Trustee under this Indenture or the rights of the Trustee
hereunder, the Issuer agrees that, unless such action is specifically permitted
hereunder or under the Basic Documents, it will not, without the prior written
consent of the Trustee, the Note Insurer (unless an Insurer Default shall have
occurred and be continuing) and/or the Holders of at least a majority in
Outstanding Amount of the Notes, amend, modify, waive, supplement, terminate or
surrender, or agree to any amendment, modification, supplement, termination,
waiver or surrender of, the terms of any Collateral or the Basic Documents, or
waive timely performance or observance by the Servicer, or the Representative
under the Sale and Servicing Agreement; provided, however, that no such
amendment shall (i) 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 (ii) reduce the aforesaid percentage of
the Notes which are required to consent to any such amendment, without the
consent of the Holders of all the Outstanding Notes. If any such amendment,
modification, supplement or waiver shall be so consented to by the Trustee, the
Note Insurer (unless an Insurer Default shall have occurred and be continuing)
or such Holders, the Issuer agrees, promptly following a request by the Trustee
to do so, to execute and deliver, in its own name and at its own expense, such
agreements, instruments, consents and other documents as the Trustee may deem
necessary or appropriate in the circumstances.
SECTION 3.8 NEGATIVE COVENANTS. So long as any Notes are Outstanding,
the Issuer shall not:
(i) except as expressly permitted by this Indenture or the Basic
Documents, sell, transfer, exchange or otherwise dispose of any of the
properties or assets of the Issuer, including those included in the
Trust Estate, unless directed to do so by the Trustee;
(ii) claim any credit on, or make any deduction from the
principal or interest payable in respect of, the Notes (other than
amounts properly withheld from such payments under the Code) or assert
any claim against any present or former Noteholder by reason of the
payment of the taxes levied or assessed upon any part of the Trust
Estate; or
(iii) (A) permit the validity or effectiveness of this Indenture
to be impaired, or permit the lien of this Indenture to be amended,
hypothecated, subordinated, terminated or discharged, or permit any
Person to be released from any covenants or obligations with respect
to the Notes under this Indenture except as may be expressly permitted
hereby, (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
Trust Estate 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 a Loan and
arising solely as a result of an action or omission of the related
obligor, except as expressly permitted by the Basic Documents) 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 Trust Estate.
SECTION 3.9 ANNUAL STATEMENT AS TO COMPLIANCE. The Issuer will deliver
to the Trustee and the Note Insurer, within 120 days after the end of each
fiscal year of the Issuer (commencing with the fiscal year ending December 31,
1998), and otherwise in compliance with the requirements of TIA Section
314(a)(4) an Officer's Certificate stating, as to the Authorized Officer signing
such Officer's Certificate, that
(i) a review of the activities of the Issuer during such year and
of performance under this Indenture has been made under such
Authorized Officer's supervision; and
(ii) to the best of such Authorized Officer's knowledge, based on
such review, the Issuer has complied with all conditions and covenants
under this Indenture throughout such year, or, if there has been a
default in the compliance of any such condition or covenant,
specifying each such default known to such Authorized Officer and the
nature and status thereof.
SECTION 3.10 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 of America or any state and shall
expressly assume, by an indenture supplemental hereto, executed and
delivered to the Trustee, in form satisfactory to the Trustee and the
Note Insurer (so long as no Insurer Default shall have occurred and be
continuing), 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;
(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 Trustee and the Note
Insurer (so long as no Insurer Default shall have occurred and be
continuing)) to the effect that such transaction will not have any
material adverse tax consequence to the Trust, the Note Insurer, any
Noteholder or any Certificateholder;
(v) any action as 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 Trustee an Officer's
Certificate and an Opinion of Counsel each stating that such
consolidation or merger and such supplemental indenture comply with
this Article III and that all conditions precedent herein provided for
relating to such transaction have been complied with (including any
filing required by the Exchange Act) ; and
(vii) so long as no Insurer Default shall have occurred and be
continuing, the Issuer shall have given the Note Insurer written
notice of such consolidation or merger at least 20 Business Days prior
to the consummation of such action and shall have received the prior
written approval of the Note Insurer of such consolidation or merger
and the Issuer or the Person (if other than the Issuer) formed by or
surviving such consolidation or merger has a net worth, immediately
after such consolidation or merger, that is (a) greater than zero and
(b) not less than the net worth of the Issuer immediately prior to
giving effect to such consolidation or merger.
(b) The Issuer shall not convey or transfer all or substantially all
of its properties or assets, including those included in the Trust Estate, to
any Person, unless
(i) the Person that acquires by conveyance or transfer the
properties and assets of the Issuer the conveyance or transfer of
which is hereby restricted shall (A) be a United States citizen or a
Person organized and existing under the laws of the United States of
America or any state, (B) expressly assume, by an indenture
supplemental hereto, executed and delivered to the Trustee, in form
satisfactory to the Trustee and the Note Insurer (so long as no
Insurer Default shall have occurred and be continuing), the due and
punctual payment of the principal of and interest on all Notes and the
performance or observance of every agreement and covenant of this
Indenture on the part of the Issuer to be performed or observed, all
as provided herein, (C) expressly agree by means of such supplemental
indenture that all right, title and interest so conveyed or
transferred shall be subject and subordinate to the rights of Holders
of the Notes, (D) unless otherwise provided in such supplemental
indenture, expressly agree to indemnify, defend and hold harmless the
Issuer against and from any loss, liability or expense arising under
or related to this Indenture and the Notes and (E) expressly agree by
means of such supplemental indenture that such Person (or if a group
of persons, then one specified Person) shall prepare (or cause to be
prepared) and make all filings with the Commission (and any other
appropriate Person) required by the Exchange Act in connection with
the Notes;
(ii) immediately after giving effect to such transaction, no
Default or Event of Default shall have occurred and be continuing;
(iii) the 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 Trustee and the Note
Insurer (so long as no Insurer Default shall have occurred and be
continuing)) to the effect that such transaction will not have any
material adverse tax consequence to the Trust, the Note Insurer, any
Noteholder or any Certificateholder;
(v) any action as 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 Trustee an Officers'
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) so long as no Insurer Default shall have occurred and be
continuing, the Issuer shall have given the Note Insurer written
notice of such conveyance or transfer at least 20 Business Days prior
to the consummation of such action and shall have received the prior
written approval of the Note Insurer of such consolidation or merger
and the Issuer or the Person (if other than the Issuer) formed by or
surviving such consolidation or merger has a net worth, immediately
after such consolidation or merger, that is (a) greater than zero and
(b)not less than the net worth of the Issuer immediately prior to
giving effect to such consolidation or merger.
SECTION 3.11 SUCCESSOR OR TRANSFEREE. (a) Upon any consolidation or
merger of the Issuer in accordance with Section 3.10(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 3.10 (b), The Money Store Trust 1998-C will be
released from every covenant and agreement of this Indenture to be observed or
performed on the part of the Issuer with respect to the Notes immediately upon
the delivery of written notice to the Trustee stating that The Money Store Trust
1998-C is to be so released.
SECTION 3.12 NO OTHER BUSINESS. The Issuer shall not engage in any
business other than financing, purchasing, owning, selling and managing the
Loans in the manner contemplated by this Indenture and the Basic Documents and
activities incidental thereto.
SECTION 3.13 NO BORROWING. The Issuer shall not issue, incur, assume,
guarantee or otherwise become liable, directly or indirectly, for any
indebtedness except for the Notes, obligations owing from time to time to the
Note Insurer under the Insurance Agreement and any other indebtedness permitted
by or arising under the Basic Documents.
SECTION 3.14 SERVICER'S OBLIGATIONS. The Issuer shall cause the
Servicer to comply with Sections 5.04, 5.05, 5.07 and 7.07 of the Sale and
Servicing Agreement.
SECTION 3.15 GUARANTEES, LOANS, ADVANCES AND OTHER LIABILITIES. Except
as contemplated by the Sale and Servicing Agreement or this Indenture, the
Issuer shall not make any loan or advance or credit to, or guarantee (directly
or indirectly or by an instrument having the effect of assuring another's
payment or performance on any obligation or capability of so doing or
otherwise), endorse or otherwise become contingently liable, directly or
indirectly, in connection with the obligations, stocks or dividends of, or own,
purchase, repurchase or acquire (or agree contingently to do so) any stock,
obligations, assets or securities of, or any other interest in, or make any
capital contribution to, any other Person.
SECTION 3.16 CAPITAL EXPENDITURES. The Issuer shall not make any
expenditure (by long-term or operating lease or otherwise) for capital assets
(either realty or personality).
SECTION 3.17 COMPLIANCE WITH LAWS. The Issuer shall comply with the
requirements of all applicable laws, the non-compliance with which would,
individually or in the aggregate, materially and adversely affect the ability of
the Issuer to perform its obligations under the Notes, this Indenture or any
Basic Document.
SECTION 3.18 RESTRICTED PAYMENTS. The Issuer shall not, directly or
indirectly, (i) pay any dividend or make any distribution (by reduction of
capital or otherwise), whether in cash, property, securities or a combination
thereof, to the Owner Trustee or any owner of a beneficial interest in the
Issuer or otherwise with respect to any ownership or equity interest or security
in or of the Issuer or to the Servicer, (ii) redeem, purchase, retire or
otherwise acquire for value any such ownership or equity interest or security or
(iii) set aside or otherwise segregate any amounts for any such purpose;
PROVIDED, HOWEVER, that the Issuer may make, or cause to be made, distributions
to the Servicer, the Owner Trustee, the Note Insurer, the Trustee, the Holder of
the Special Interest and the Certificateholders as permitted by, and to the
extent funds are available for such purpose under, the Sale and Servicing
Agreement or Trust Agreement. The Issuer will not, directly or indirectly, make
payments to or distributions from the Principal and Interest Account except in
accordance with this Indenture and the Basic Documents.
SECTION 3.19 NOTICE OF EVENTS OF DEFAULT. The Issuer agrees to give
the Trustee, the Note Insurer, and the Rating Agencies prompt written notice of
each Event of Default hereunder and each default on the part of the Servicer or
the Representative of its obligations under the Sale and Servicing Agreement of
which an Authorized Officer of the Issuer acquires actual knowledge.
SECTION 3.20 FURTHER INSTRUMENTS AND ACTS. Upon request of the 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.
SECTION 3.21 INCOME TAX CHARACTERIZATION. For purposes of federal
income, state and local income and franchise and any other income taxes, the
Issuer will treat the Notes as indebtedness of the Issuer and the Issuer shall
take all actions necessary to ensure that the Issuer is not treated as an
association (or publicly traded partnership) taxable as a corporation.
ARTICLE IIIA
REPRESENTATIONS AND WARRANTIES
SECTION 3.1A. REPRESENTATIONS AND WARRANTIES OF ISSUER. The Issuer
hereby represents and warrants as of the date of initial issuance of Notes as
follows:
(a) The Issuer is a business trust, and is duly organized, validly
existing and in good standing under the laws of the State of Delaware.
(b) The Notes, when executed, authenticated and issued in accordance
with the Indenture, and the Basic Documents (other than the Notes) to which the
Issuer is a party, when executed and delivered by the Issuer, will constitute
the legal, valid and binding obligations of the Issuer, enforceable in
accordance with their respective terms against the Issuer, subject to
bankruptcy, insolvency, reorganization, moratorium, fraudulent conveyance or
other similar laws relating to or affecting creditors' equitable principles and
public policy considerations as to rights of indemnification.
(c) The Issuer's principal place of business is located in Wilmington,
Delaware.
(d) The Issuer has good and marketable title to each Loan and Mortgage
Note free and clear of any lien (other than liens contemplated by the Basic
Documents) and the Issuer has the authority to pledge the Loans and Mortgage
Notes to the Indenture Trustee as contemplated in this Indenture.
ARTICLE IV
SATISFACTION AND DISCHARGE
SECTION 4.1 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 3.3, 3.4, 3.5, 3.8,
3.10, 3.12, 3.13, 3.21 and 11.16, (v) the rights, obligations and immunities of
the Trustee hereunder (including the rights of the Trustee under Section 6.7 and
the obligations of the Trustee under Section 4.2) and (vi) the rights of
Noteholders as beneficiaries hereof with respect to the property so deposited
with the Trustee payable to all or any of them, and the Trustee, on demand of
and at the expense of the Issuer, shall execute proper instruments acknowledging
satisfaction and discharge of this Indenture with respect to the Notes, when
(A) either
(1) 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 2.5 and (ii) Notes for whose payment money has
theretofore been deposited in trust or segregated and held in trust by the
Issuer and thereafter repaid to the Issuer or discharged from such trust, as
provided in Section 3.3) have been delivered to the Trustee for cancellation and
the Note Policy has expired and been returned to the Note Insurer for
cancellation; or
(2) all Notes not theretofore delivered to the Trustee for
cancellation
(i) have become due and payable,
(ii) will become due and payable at their respective Final
Maturity Dates within one year, or
(iii) are to be called for redemption within one year under
arrangements satisfactory to the Trustee for the giving of notice of
redemption by the Trustee in the name, and at the expense, of the
Issuer,
and the Issuer, in the case of (i), (ii) or (iii) above, has
irrevocably deposited or caused to be irrevocably deposited with the
Trustee cash or direct obligations of or obligations guaranteed by the
United States of America (which will mature prior to the date such
amounts are payable), in trust for such purpose, in an amount
sufficient to pay and discharge the entire indebtedness on such Notes
not theretofore delivered to the Trustee for cancellation when due to
the Final Scheduled Remittance Date or Redemption Date (if Notes shall
have been called for redemption pursuant to Section 10.1(a)), as the
case may be;
(B) the Issuer has paid or caused to be paid Insurer Issuer Secured
Obligations and all Trustee Issuer Secured Obligations and all other sums
payable hereunder by the Issuer; and
(C) the Issuer has delivered to the Trustee and the Note Insurer an
Officer's Certificate, an Opinion of Counsel and (if required by the TIA,
the Trustee or the Note Insurer (so long as no Insurer Default shall have
occurred and be continuing)) an Independent Certificate from a firm of
certified public accountants, each meeting the applicable requirements of
Section 11.1(a) and each stating that all conditions precedent herein
provided for relating to the satisfaction and discharge of this Indenture
have been complied with.
SECTION 4.2 APPLICATION OF TRUST MONEY. All moneys deposited with the
Trustee pursuant to Section 4.1 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 Trustee may
determine, to the Holders of the particular Notes for the payment or redemption
of which such moneys have been deposited with the Trustee, of all sums due and
to become due thereon for principal and interest; but such moneys need not be
segregated from other funds except to the extent required herein or in the Sale
and Servicing Agreement or required by law.
SECTION 4.3 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 Trustee under the
provisions of this Indenture with respect to such Notes shall, upon demand of
the Issuer, be paid to the Trustee to be held and applied according to Section
3.3 and thereupon such Paying Agent shall be released from all further liability
with respect to such moneys.
SECTION 4.4 NOTICE. Upon the satisfaction and discharge of this
Indenture with respect to any class of Notes, the Trustee shall notify each
Rating Agency of such satisfaction and discharge.
ARTICLE V
REMEDIES
SECTION 5.1 EVENTS OF DEFAULT. "Event of Default," wherever used
herein, means any one of the following events (whatever the reason for such
Event of Default and whether it shall be voluntary or involuntary or be effected
by operation of law or pursuant to any judgment, decree or order of any court or
any order, rule or regulation of any administrative or governmental body):
(i) default in the payment of any interest on any Note (other
than any Noteholders' Interest Carryover, if applicable) when the same
becomes due and payable, and such default shall continue for a period
of five days (a payment on the Notes funded by the Note Insurer shall
not be deemed to be a payment made by the Issuer); or
(ii) default in the payment of the principal of any Note when the
same becomes due and payable (a payment on the Notes funded by the
Note Insurer shall not be deemed to be a payment made by the Issuer);
or
(iii) so long as an Insurer Default shall have occurred and be
continuing, 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), which
continues for a period of 30 days (or for such longer period, not in
excess of 90 days, as may be reasonably necessary to remedy such
default; provided that such default is capable of remedy within 90
days or less and the Servicer on behalf of the Owner Trustee delivers
an Officer's Certificate to the Trustee to the effect that the Issuer
has commenced, or will promptly commence and diligently pursue, all
reasonable efforts to remedy such default) after notice thereof shall
have been given, by registered or certified mail, to the Issuer by the
Trustee or to the Issuer and the Trustee by the Holders of at least
25% of the Outstanding Amount of the 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
(iv) so long as an Insurer Default shall have occurred and be
continuing, any representation or warranty of the Issuer made in this
Indenture 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 breach is not cured within 30 days (or for such longer
period, not in excess of 90 days, as may be reasonably necessary to
remedy such default; provided that such default is capable of remedy
within 90 days or less and the Servicer on behalf of the Owner Trustee
delivers an Officer's Certificate to the Trustee to the effect that
the Issuer has commenced, or will promptly commence and diligently
pursue, all reasonable efforts to remedy such default) after notice
thereof after there shall have been given, by registered or certified
mail, to the Issuer by the Trustee or to the Issuer and the Trustee by
the Holders of at least 25% of the Outstanding Amount of the 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) so long as an Insurer Default shall have occurred and be
continuing, 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 Trust Estate 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 Trust Estate, 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 30
consecutive days;
(vi) so long as an Insurer Default shall have occurred and be
continuing, 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 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 Trust Estate, 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
action by the Issuer in furtherance of any of the foregoing; or
(vii) so long as an Insurer Default shall not have occurred and
be continuing, an Insurance Agreement Event of Default shall have
occurred; provided, however, that the occurrence of an Insurance
Agreement Event of Default may not form the basis of an Event of
Default unless the Note Insurer shall, upon prior written notice to
the Rating Agencies, have delivered to the Issuer and the Trustee and
not rescinded a written notice specifying that such Insurance
Agreement Event of Default constitutes an Event of Default under the
Indenture.
The Issuer shall deliver to the 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 of which an Authorized Officer of the Issuer
has acquired actual knowledge which with the giving of notice and the lapse of
time would become an Event of Default under clause (iii), its status and what
action the Issuer is taking or proposes to take with respect thereto.
SECTION 5.2 ACCELERATION OF MATURITY; RESCISSION AND ANNULMENT. (a) If
an Event of Default shall have occurred and be continuing, the Controlling Party
may exercise any of the remedies specified in Section 5.4(a). In the event of
any acceleration of any Notes at the direction of the Note Insurer by operation
of this Section 5.2, the Trustee shall continue to be entitled to make claims
under the Note Policies for Note Insured Payments on the Notes. Payments under
the Note Policies following acceleration of any Notes shall be applied by the
Trustee:
FIRST: to Noteholders of the applicable Pool for amounts due and
unpaid on the Notes for interest, ratably, without preference or priority
of any kind, according to the amounts due and payable on the Notes of such
Pool for interest; and
SECOND: to Noteholders of the applicable Pool for amounts due and
unpaid on the Notes for principal, ratably, without preference or priority
of any kind, according to the amounts due and payable on the Notes of such
Pool for principal.
(b) In the event any Notes are accelerated due to an Event of Default,
the Note Insurer shall have the right (in addition to its obligation to pay Note
Insured Payments on the Notes in accordance with the Note Policies), but not the
obligation, to make payments under the Note Policies or otherwise of interest
and principal due on such Notes, in whole or in part, on any date or dates
following such acceleration as the Note Insurer, in its sole discretion, shall
elect.
(c) If an Insurer Default shall have occurred and be continuing and an
Event of Default shall have occurred and be continuing, the Trustee in its
discretion may, or if so requested in writing by Holders holding Notes
representing not less than a majority of the Outstanding Amount of the Notes,
shall declare by written notice to the Issuer that the Notes become, whereupon
they shall become, immediately due and payable at par, together with accrued and
unpaid interest thereon.
(d) If an Insurer Default shall have occurred and be continuing, then
at any time after such declaration of acceleration of maturity has been made and
before a judgment or decree for payment of the money due has been obtained by
the Trustee as hereinafter in this Article V provided, the Holders of Notes
representing a majority of the Outstanding Amount of the Notes, by written
notice to the Issuer and the Trustee, may rescind and annul such declaration and
its consequences if:
(i) the Issuer has paid or deposited with the Trustee a sum
sufficient to pay
(A) all payments of principal of and interest on all Notes and
all other amounts that would then be due hereunder or upon such Notes
if the Event of Default giving rise to such acceleration had not
occurred; and
(B) all sums paid or advanced by the Trustee hereunder and the
reasonable compensation, expenses, disbursements and advances of the
Trustee and its agents and counsel; and
(ii) all Events of Default, other than the nonpayment of the
principal of the Notes that has become due solely by such
acceleration, have been cured or waived as provided in Section 5.12.
No such rescission shall affect any subsequent default or impair any
right consequent thereto.
SECTION 5.3 COLLECTION OF INDEBTEDNESS AND SUITS FOR ENFORCEMENT BY
TRUSTEE. (a) The Issuer covenants that if (i) default is made in the payment of
any interest on any Note when the same becomes due and payable, and such default
continues for a period of five days, or (ii) default is made in the payment of
the principal of or any installment of the principal of any Note when the same
becomes due and payable, the Issuer will, upon demand of the Trustee (which
demand will be made by the Trustee only with the prior written consent of the
Note Insurer), pay to it, 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 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 Trustee and its agents and counsel.
(b) Each Issuer Secured Party hereby irrevocably and unconditionally
appoints the Controlling Party as the true and lawful attorney-in-fact of such
Issuer Secured Party for so long as such Issuer Secured Party is not the
Controlling Party, with full power of substitution, to execute, acknowledge and
deliver any notice, document, certificate, paper, pleading or instrument and to
do in the name of the Controlling Party as well as in the name, place and stead
of such Issuer Secured Party such acts, things and deeds for or on behalf of and
in the name of such Issuer Secured Party under this Indenture (including
specifically under Section 5.4) and under the Basic Documents which such Issuer
Secured Party could or might do or which may be necessary, desirable or
convenient in such Controlling Party's sole discretion to effect the purposes
contemplated hereunder and under the Basic Documents and, without limitation,
following the occurrence of an Event of Default, exercise full right, power and
authority to take, or defer from taking, any and all acts with respect to the
administration, maintenance or disposition of the Trust Estate.
(c) If an Event of Default occurs and is continuing, the
Trustee may, with the consent of the Note Insurer if the Note Insurer is the
Controlling Party and shall, at the direction of the Note Insurer if the Note
Insurer is the Controlling Party (except as provided in Section 5.3(d) below),
proceed to protect and enforce its rights and the rights of the Noteholders, by
such appropriate proceedings as the Trustee or the Note Insurer if the Note
Insurer is the Controlling Party 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 Trustee by this Indenture or by law.
(d) Notwithstanding anything to the contrary contained in this
Indenture and regardless of whether an Insurer Default shall have occurred and
be continuing, if the Issuer fails to perform its obligations under Section
10.1(b) hereof when and as due, the Trustee shall (and without the consent of
the Note Insurer if the Note Insurer is the Controlling Party) proceed to
protect and enforce its rights and the rights of the Noteholders by such
appropriate proceedings as the Trustee shall deem most effective to protect and
enforce any such rights, whether for specific performance 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 Trustee by this Indenture or by law; provided that the Trustee shall only
be entitled to take any such actions without the consent of the Note Insurer if
the Note Insurer is the Controlling Party to the extent such actions are taken
only to enforce the Issuer's obligations to redeem the principal amount of
Notes.
(e) In case there shall be pending, relative to the Issuer or any
other obligor upon the Notes or any Person having or claiming an ownership
interest in the Trust Estate, proceedings under Title 11 of the United States
Code or any other applicable Federal or state bankruptcy, insolvency or other
similar law, or in case a receiver, assignee or trustee in bankruptcy or
reorganization, liquidator, sequestrator or similar official shall have been
appointed for or taken possession of the Issuer or its property or such other
obligor or Person, or in case of any other comparable judicial proceedings
relative to the Issuer or other obligor upon the Notes, or to the creditors or
property of the Issuer or such other obligor, the Trustee, irrespective of
whether the principal of any Notes shall then be due and payable as therein
expressed or by declaration or otherwise and irrespective of whether the Trustee
shall have made any demand pursuant to the provisions of this Section, shall be
entitled and empowered, by intervention in such proceedings or otherwise:
(i) to file and prove a claim or claims for the whole amount of
principal and interest owing and unpaid in respect of the Notes and to
file such other papers or documents as may be necessary or advisable
in order to have the claims of the Trustee (including any claim for
reasonable compensation to the Trustee and each predecessor Trustee,
and their respective agents, attorneys and counsel, and for
reimbursement of all expenses and liabilities incurred, and all
advances made, by the Trustee and each predecessor Trustee, except as
a result of negligence, bad faith or willful misconduct) 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 and of the
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
Trustee or the Holders of Notes allowed in any judicial proceedings
relative to the Issuer, its creditors and its property;
and any trustee, receiver, liquidator, custodian or other similar official in
any such proceeding is hereby authorized by each of such Noteholders to make
payments to the Trustee, and, in the event that the Trustee shall consent to the
making of payments directly to such Noteholders, to pay to the Trustee such
amounts as shall be sufficient to cover reasonable compensation to the Trustee,
each predecessor Trustee and their respective agents, attorneys and counsel, and
all other expenses and liabilities incurred, and all advances made, by the
Trustee and each predecessor Trustee except as a result of negligence or bad
faith.
(f) Nothing herein contained shall be deemed to authorize the Trustee
to authorize or consent to or vote for or accept or adopt on behalf of any
Noteholder any plan of reorganization, arrangement, adjustment or composition
affecting the Notes or the rights of any Holder thereof or to authorize the
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.
(g) All rights of action and of asserting claims under this Indenture,
or under any of the Notes, may be enforced by the Trustee without the possession
of any of the Notes or the production thereof in any trial or other proceedings
relative thereto, and any such action or proceedings instituted by the 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 Trustee, each predecessor Trustee and their respective
agents and attorneys, shall be for the ratable benefit of the Holders of the
Notes.
(h) In any proceedings brought by the Trustee (and also any
proceedings involving the interpretation of any provision of this Indenture to
which the Trustee shall be a party), the Trustee shall be held to represent all
the Holders of the Notes, and it shall not be necessary to make any Noteholder a
party to any such proceedings.
SECTION 5.4 REMEDIES; PRIORITIES. (a) If an Event of Default shall
have occurred and be continuing, the Controlling Party may do one or more of the
following (subject to Section 5.5):
(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 Trust
Estate;
(iii) exercise any remedies of a secured party under the UCC and
take any other appropriate action to protect and enforce the rights
and remedies of the Trustee and the Holders of the Notes; and
(iv) sell the Trust Estate or any portion thereof or rights or
interest therein, at one or more public or private sales called and
conducted in any manner permitted by law;
(b) If the Trustee collects any money or property pursuant to this
Article V, it shall pay out such money or property held as Collateral in the
following order of priority (such payments to be made first from proceeds of the
applicable Pool and, if any funds from the other Pool remain after payment of
clauses FIRST through FOURTH, from proceeds of the other Pool):
FIRST: to the Noteholders of a Pool for amounts due and unpaid
for interest, ratably and without preference or priority of any kind,
according to the amounts due and payable on the Notes of such Pool for
interest;
SECOND: to the Noteholders of a Pool for amounts due and unpaid
on the Notes for principal, ratably and without preference or priority
of any kind, according to the amounts due and payable on the Notes of
such Pool for principal;
THIRD: amounts due and owing and required to be distributed to
the Note Insurer pursuant to Section 7.14(a)(ii) and (iii) of the Sale
and Servicing Agreement and not previously distributed; and
FOURTH: to the Trustee for amounts under Section 6.7.
Any remaining amounts shall be paid to the Issuer for distribution to
the Certificateholders.
The Trustee may fix a record date and payment date for any payment to
Noteholders pursuant to this Section. At least 15 days before such record date,
the Issuer shall mail to each Noteholder and the Trustee a notice that states
the record date, the payment date and the amount to be paid.
SECTION 5.5 OPTIONAL PRESERVATION OF THE LOANS. If the Trustee is the
Controlling Party and if the Notes have been declared to be due and payable
under Section 5.2 following an Event of Default and such declaration and its
consequences have not been rescinded and annulled, the Trustee may, but need
not, elect to maintain possession of the Trust Estate. It is the desire of the
parties hereto and the Noteholders that there be at all times sufficient funds
for the payment of principal of and interest on the Notes, and the Trustee shall
take such desire into account when determining whether or not to maintain
possession of the Trust Estate. In determining whether to maintain possession of
the Trust Estate, the Trustee may, but need not, obtain and rely upon an opinion
of an Independent investment banking or accounting firm of national reputation
as to the feasibility of such proposed action and as to the sufficiency of the
Trust Estate for such purpose.
SECTION5.6 LIMITATION OF SUITS. No Holder of any Note shall have any
right to institute any proceeding, judicial or otherwise, with respect to this
Indenture, or for the appointment of a receiver or trustee, or for any other
remedy hereunder, unless:
(i) such Holder has previously given written notice to the
Trustee of a continuing Event of Default;
(ii) the Holders of not less than 25% of the Outstanding Amount
of the Notes have made written request to the Trustee to institute
such proceeding in respect of such Event of Default in its own name as
Trustee hereunder;
(iii) such Holder or Holders have offered to the Trustee
indemnity reasonably satisfactory to it against the costs, expenses
and liabilities to be incurred in complying with such request;
(iv) the Trustee for 60 days after its receipt of such notice,
request and offer of indemnity has failed to institute such
proceedings;
(v) no direction inconsistent with such written request has been
given to the Trustee during such 60-day period by the Holders of a
majority of the Outstanding Amount of the Notes; and
(vi) an Insurer Default shall have occurred and be continuing; it
being 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 Trustee shall receive conflicting or inconsistent
requests and indemnity from two or more groups of Holders of Notes, each
representing less than a majority of the Outstanding Amount of the Notes, the
Trustee in its sole discretion may determine what action, if any, shall be
taken, notwithstanding any other provisions of this Indenture.
SECTION 5.7 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 such Note on or
after the respective due dates 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.
SECTION 5.8 RESTORATION OF RIGHTS AND REMEDIES. If the Controlling
Party 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 Trustee or to
such Noteholder, then and in every such case the Issuer, the Trustee and the
Noteholders shall, subject to any determination in such Proceeding, be restored
severally and respectively to their former positions hereunder, and thereafter
all rights and remedies of the Trustee and the Noteholders shall continue as
though no such proceeding had been instituted.
SECTION 5.9 RIGHTS AND REMEDIES CUMULATIVE. No right or remedy herein
conferred upon or reserved to the Controlling Party 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 Controlling Party 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 Trustee or to the Noteholders may be exercised from time to time, and as
often as may be deemed expedient, by the Trustee or by the Noteholders, as the
case may be.
SECTION5.11 CONTROL BY NOTEHOLDERS. If the Trustee is the Controlling
Party, the Holders of a majority of the Outstanding Amount of the Notes shall
have the right to direct the time, method and place of conducting any proceeding
for any remedy available to the Trustee with respect to the Notes or exercising
any trust or power conferred on the Trustee; PROVIDED that
(i) such direction shall not be in conflict with any rule of law
or with this Indenture;
(ii) subject to the express terms of Section 5.4, any direction
to the Trustee to sell or liquidate the Trust Estate shall be by the
Holders of Notes representing not less than 100% of the Outstanding
Amount of the Notes;
(iii) if the conditions set forth in Section 5.5 have been
satisfied and the Trustee elects to retain the Trust Estate pursuant
to such Section, then any direction to the trustee by Holders of Notes
representing less than 100% of the Outstanding Amount of the Notes to
sell or liquidate the Trust Estate shall be of no force and effect;
and
(iv) the Trustee may take any other action deemed proper by the
Trustee that is not inconsistent with such direction;
PROVIDED, HOWEVER, that, subject to Section 6.1, the 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. If an Insurer Default shall have
occurred and be continuing prior to the declaration of the acceleration of the
maturity of the Notes as provided in Section 5.2, the Holders of Notes of not
less than a majority of the Outstanding Amount of the Notes may waive any past
Default or Event of Default and its consequences except a Default (a) in payment
of principal of or interest on any of the Notes or (b) in respect of a covenant
or provision hereof which cannot be modified or amended without the consent of
the Holder of each Note. In the case of any such waiver, the Issuer, the Trustee
and the Holders of the Notes shall be restored to their former positions and
rights hereunder, respectively; but no such waiver shall extend to any
subsequent or other 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 Trustee for any action taken, suffered or omitted by it as 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 Trustee, (b) any suit instituted by any Noteholder,
or group of Noteholders, in each case holding in the aggregate more than 10% of
the Outstanding Amount of the Notes or (c) any suit instituted by any Noteholder
for the enforcement of the payment of principal of or interest on any Note on or
after the respective due dates expressed in such Note and in this Indenture (or,
in the case of redemption, on or after the Redemption Date).
SECTION 5.14 WAIVER OF STAY OR EXTENSION LAWS. The Issuer covenants
(to the extent that it may lawfully do so) that it will not at any time insist
upon, or plead or in any manner whatsoever, claim or take the benefit or
advantage of, any stay or extension law wherever enacted, now or at any time
hereafter in force, that may affect the covenants or the performance of this
Indenture; and the Issuer (to the extent that it may lawfully do so) hereby
expressly waives all benefit or advantage of any such law, and covenants that it
will not hinder, delay or impede the execution of any power herein granted to
the Trustee, 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 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 Trustee or the Noteholders shall be impaired by the recovery of any judgment
by the Trustee against the Issuer or by the levy of any execution under such
judgment upon any portion of the Trust Estate or upon any of the assets of the
Issuer.
SECTION 5.16 PERFORMANCE AND ENFORCEMENT OF CERTAIN OBLIGATIONS. (a)
Promptly following a written request from the Trustee to do so and at the
Servicer's expense, the Issuer agrees to take all such lawful action as the
Trustee may request to compel or secure the performance and observance by the
Representative, and the Servicer, as applicable, of each of their obligations to
the Issuer under or in connection with the Sale and Servicing Agreement in
accordance with the terms thereof, and to exercise any and all rights, remedies,
powers and privileges lawfully available to the Issuer under or in connection
with the Sale and Servicing Agreement to the extent and in the manner directed
by the Trustee, including the transmission of notices of default on the part of
the Representative or the Servicer thereunder and the institution of legal or
administrative actions or proceedings to compel or secure performance by the
Representative or the Servicer of each of their obligations under the Sale and
Servicing Agreement.
(b) If the Trustee is the Controlling Party and if an Event of Default
has occurred and is continuing, the Trustee may, and, at the direction (which
direction shall be in writing or by telephone (confirmed in writing promptly
thereafter)) of the Holders of 66-2/3% of the Outstanding Amount of the Notes
shall, exercise all rights, remedies, powers, privileges and claims of the
Issuer against the Representative or the Servicer under or in connection with
the Sale and Servicing Agreement, including the right or power to take any
action to compel or secure performance or observance by the Representative or
the Servicer of each of their obligations to the Issuer thereunder and to give
any consent, request, notice, direction, approval, extension or waiver under the
Sale and Servicing Agreement, and any right of the Issuer to take such action
shall be suspended.
ARTICLE VI
THE TRUSTEE
SECTION 6.1 DUTIES OF TRUSTEE. (a) If an Event of Default has occurred
and is continuing, the 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 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
Trustee; and
(ii) in the absence of bad faith on its part, the 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 Trustee and conforming to the requirements
of this Indenture; however, the Trustee shall examine the certificates
and opinions to determine whether or not they conform to the
requirements of this Indenture.
(c) The 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;
(ii) the Trustee shall not be liable for any error of judgment
made in good faith by a Responsible Officer unless it is proved that
the Trustee was negligent in ascertaining the pertinent facts; and
(iii) the 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.
(d) The Trustee shall not be liable for interest on any money received
by it except as the Trustee may agree in writing with the Issuer.
(e) Money held in trust by the Trustee need not be segregated from
other funds except to the extent required by law or the terms of this Indenture
or the Sale and Servicing Agreement.
(f) No provision of this Indenture shall require the Trustee to expend
or risk its own funds or otherwise incur financial liability in the performance
of any of its duties hereunder or in the exercise of any of its rights or
powers, if it shall have reasonable grounds to believe that repayment of such
funds or adequate indemnity against such risk or liability is not reasonably
assured to it.
(g) Every provision of this Indenture relating to the conduct or
affecting the liability of or affording protection to the Trustee shall be
subject to the provisions of this Section and to the provisions of the TIA.
(h) The Trustee shall, and hereby agrees that it will, perform all of
the obligations and duties required of it under the Sale and Servicing
Agreement.
(i) Whenever any action under the Basic Documents requires the
approval or disapproval of Certificateholders or the Holder of the Voting
Interest, the Trustee shall, in accordance with, and subject to, Section 2.11 of
the Trust Agreement and other provisions of the Trust Agreement concerning the
Holder of the Voting Interest, instruct the Holder of the Voting Interest to act
in accordance with written directions, received from Holders of a majority of
the Outstanding Amount of the Notes
(j) The Trustee's appointment of the Custodian shall be deemed to have
been made with due care and without negligence on the part of the Trustee. The
Trustee shall have no liability or responsibility in connection with or arising
out of any acts or omissions on the part of any Custodian.
(k) The Trustee shall, upon reasonable prior notice to the Trustee,
permit any representative of the Note Insurer, at the Note Insurer's expense,
during the Trustee's normal business hours, to examine all books of account,
records, reports and other papers of the Trustee relating to the Notes, to make
copies and extracts therefrom and to discuss the Trustee's affairs and actions,
as such affairs and actions relate to the Trustee's duties with respect to the
Notes, with the Trustee's officers and employees responsible for carrying out
the Trustee's duties with respect to the Notes.
(l) The Trustee shall, and hereby agrees that it will, hold the Note
Policies in trust, and will hold any proceeds of any claim on a Note Policy in
trust solely for the use and benefit of the Noteholders.
(m) Without limiting the generality of this Section 6.1, the Trustee
shall have no duty (i) to see to any recording, filing or depositing of this
Indenture or any agreement referred to herein or any financing statement
evidencing a security interest in the Loans, or to see to the maintenance of any
such recording or filing or depositing or to any recording, refiling or
redepositing of any thereof, (ii) to see to the payment or discharge of any tax,
assessment or other governmental charge or any lien or encumbrance of any kind
owing with respect to, assessed or levied against any part of the Trust, (iii)
to confirm or verify the contents of any reports or certificates delivered to
the Trustee pursuant to this Indenture or the Sale and Servicing Agreement
believed by the Trustee to be genuine and to have been signed or presented by
the proper party or parties, or (iv) to inquire as to the performance of
observance of any of the Issuer's, the Originator's, the Trust Administrator's
or the Servicer's representations, warranties or covenants or the Servicer's
duties and obligations as Servicer under the Sale and Servicing Agreement.
SECTION 6.2 RIGHTS OF TRUSTEE. (a) The Trustee may rely on any
document believed by it to be genuine and to have been signed or presented by
the proper person. The Trustee need not investigate any fact or matter stated in
the document.
(b) Before the Trustee acts or refrains from acting, it may require an
Officer's Certificate or an Opinion of Counsel. The Trustee shall not be liable
for any action it takes or omits to take in good faith in reliance on the
Officer's Certificate or Opinion of Counsel.
(c) With the prior written consent of the Note Insurer, the 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. The Trustee shall not be responsible for any misconduct or negligence
on the part of, or for the supervision of, any such agent, attorney, custodian
or nominee appointed with due care by it hereunder.
(d) The Trustee shall not be liable for any action it takes or omits
to take in good faith which it believes to be authorized or within its rights or
powers; provided, however, that the Trustee's conduct does not constitute
willful misconduct, negligence or bad faith.
(e) The Trustee may consult with counsel of its selection, and the
advice or opinion of counsel with respect to legal matters relating to this
Indenture and the Notes shall be full and complete authorization and protection
from liability in respect to any action taken, omitted or suffered by it
hereunder in good faith and in accordance with the advice or opinion of such
counsel.
(f) The Trustee shall be under no obligation to institute, conduct or
defend any litigation under this Indenture or in relation to this Indenture, at
the request, order or direction of any of the Holders of Notes or the
Controlling Party, pursuant to the provisions of this Indenture, unless such
Holders of Notes or the Controlling Party shall have offered to the Trustee
reasonable security or indemnity against the costs, expenses and liabilities
that may be incurred therein or thereby.
(g) The Trustee shall not be bound to make any investigation into the
facts or matters stated in any resolution, certificate, statement, instrument,
opinion, report, notice, request, consent, order, approval, bond or other paper
or document, unless requested in writing to do so by the Note Insurer (so long
as no Insurer Default shall have occurred and be continuing) or (if an Insurer
Default shall have occurred and be continuing) by the Holders of Notes
evidencing not less than 25% of the Outstanding Amount thereof; PROVIDED,
HOWEVER, that if the payment within a reasonable time to the Trustee of the
costs, expenses or liabilities likely to be incurred by it in the making of such
investigation is, in the opinion of the Trustee, not reasonably assured to the
Trustee by the security afforded to it by the terms of this Indenture or the
Sale and Servicing Agreement, the Trustee may require reasonable indemnity
against such cost, expense or liability as a condition to so proceeding; the
reasonable expense of every such examination shall be paid by the Person making
such request, or, if paid by the Trustee, shall be reimbursed by the Person
making such request upon demand.
SECTION 6.3 INDIVIDUAL RIGHTS OF TRUSTEE. The Trustee in its
individual or any other capacity may become the owner or pledgee of Notes and
may otherwise deal with the Issuer or its Affiliates with the same rights it
would have if it were not Trustee. Any Paying Agent, Note Registrar,
co-registrar or co-paying agent may do the same with like rights. However, the
Trustee must comply with Sections 6.11 and 6.12.
SECTION 6.4 TRUSTEE'S DISCLAIMER. The Trustee shall not be responsible
for and makes no representation as to the validity or adequacy of this Indenture
or the Notes, it shall not be accountable for the Issuer's use of the proceeds
from the Notes, and it shall not be 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 Trustee's certificate of authentication.
SECTION 6.5 NOTICE OF DEFAULTS. If a Default occurs and is continuing
and if it is either actually known or written notice of the existence thereof
has been delivered to a Responsible Officer of the Trustee, the Trustee shall
mail to each Noteholder and the Owner Trustee notice of the Default within 90
days after such knowledge or notice occurs and to the Note Insurer promptly
after such knowledge or notice 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 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 6.6 REPORTS BY TRUSTEE TO HOLDERS. The Trustee shall deliver
to each Noteholder such information as may be reasonably required to enable such
Holder to prepare its Federal and state income tax returns.
SECTION 6.7 COMPENSATION AND INDEMNITY. The Issuer shall or shall
cause the Servicer to pay to the Trustee and the Custodian (as defined below)
from time to time compensation for their services in accordance with separate
agreements between the Servicer and the Trustee, and the Servicer and the
Custodian, respectively, which compensation shall not be limited by any law on
compensation of a trustee of an express trust. The Issuer shall or shall cause
the Servicer to reimburse the Trustee and the Custodian for all reasonable
out-of-pocket expenses incurred or made by it, including costs of collection, in
addition to the compensation for its services. Such expenses shall include the
reasonable compensation and expenses, disbursements and advances of the
Trustee's or the Custodian's agents, counsel, accountants and experts. The
Issuer shall or shall cause the Servicer to indemnify the Trustee and the
Custodian and their respective officers, directors, employees and agents against
any and all loss, liability or expense (including attorneys' fees and expenses)
incurred by any of them in connection with the acceptance or the administration
of this trust and the performance of their respective duties hereunder and under
the Sale and Servicing Agreement and the Custodial Agreement. The Trustee or the
Custodian shall notify the Issuer and the Servicer promptly of any claim for
which it may seek indemnity. Failure by the Trustee or the Custodian to so
notify the Issuer and the Servicer shall not relieve the Issuer of its
obligations hereunder or the Servicer of its obligations under Article XII of
the Sale and Servicing Agreement. The Issuer shall or shall cause the Servicer
to defend the claim and the Trustee or the Custodian may have separate counsel
and the Issuer shall or shall cause the Servicer to pay the reasonable fees and
expenses of such counsel. Neither the Issuer nor the Servicer need reimburse any
expense or indemnify against any loss, liability or expense incurred by the
Trustee or the Custodian through the Trustee's or Custodian's, as applicable,
own willful misconduct, negligence or bad faith.
The Issuer's payment obligations to the Trustee and the Custodian
pursuant to this Section shall survive the discharge of this Indenture and the
resignation or removal of the Trustee or the Custodian, as applicable, subject
to a satisfaction of the Rating Agency Condition. When the Trustee incurs
expenses after the occurrence of a Default specified in Section 5.1(iv) or (v)
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. Notwithstanding anything
else set forth in this Indenture or the Basic Documents, the Trustee agrees that
the obligations of the Issuer (but not the Servicer) to the Trustee hereunder
and under the Basic Documents shall be recourse to the Trust Estate only and
specifically shall not be recourse to the assets of the Holder of the Voting
Interest, the Representative, any Originator or any Certificateholder.
SECTION 6.8 REPLACEMENT OF TRUSTEE. The Trustee may resign at any time
by so notifying the Issuer, the Representative and the Note Insurer. The
Representative may with the consent of the Note Insurer and, at the request of
the Note Insurer (unless an Insurer Default shall have occurred and be
continuing) shall, remove the Trustee, if:
(i) the Trustee fails to comply with Section 6.11;
(ii) a court having jurisdiction in the premises in respect of
the Trustee in an involuntary case or proceeding under federal or
state banking or bankruptcy laws, as now or hereafter constituted, or
any other applicable federal or state bankruptcy, insolvency or other
similar law, shall have entered a decree or order granting relief or
appointing a receiver, liquidator, assignee, custodian, trustee,
conservator, sequestrator (or similar official) for the Trustee or for
any substantial part of the Trustee's property, or ordering the
winding-up or liquidation of the Trustee's affairs;
(iii) an involuntary case under the federal bankruptcy laws, as
now or hereafter in effect, or another present or future federal or
state bankruptcy, insolvency or similar law is commenced with respect
to the Trustee and such case is not dismissed within 60 days;
(iv) the Trustee commences a voluntary case under any federal or
state banking or bankruptcy laws, as now or hereafter constituted, or
any other applicable federal or state bankruptcy, insolvency or other
similar law, or consents to the appointment of or taking possession by
a receiver, liquidator, assignee, custodian, trustee, conservator,
sequestrator (or other similar official) for the Trustee or for any
substantial part of the Trustee's property, or makes any assignment
for the benefit of creditors or fails generally to pay its debts as
such debts become due or takes any corporate action in furtherance of
any of the foregoing; or
(v) the Trustee otherwise becomes incapable of acting.
If the Trustee resigns or is removed or if a vacancy exists in the
office of Trustee for any reason (the Trustee in such event being referred to
herein as the retiring Trustee), the Representative shall promptly appoint a
successor Trustee.
A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee and to the Issuer, the Representative and
the Note Insurer (so long as no Insurer Default shall have occurred and be
continuing). Thereupon the resignation or removal of the retiring Trustee shall
become effective, and the successor Trustee shall have all the rights, powers
and duties of the Trustee under this Indenture subject to satisfaction of the
Rating Agency Condition. The successor Trustee shall mail a notice of its
succession to Noteholders. The retiring Trustee shall promptly transfer all
property held by it as Trustee to the successor Trustee.
If a successor Trustee does not take office within 60 days after the
retiring Trustee resigns or is removed, the retiring Trustee, the Representative
or the Holders of a majority in Outstanding Amount of the Notes may petition any
court of competent jurisdiction for the appointment of a successor Trustee.
If the Trustee fails to comply with Section 6.11, any Noteholder may
petition any court of competent jurisdiction for the removal of the Trustee and
the appointment of a successor Trustee.
Any resignation or removal of the Trustee and appointment of a
successor Trustee pursuant to any of the provisions of this Section shall not
become effective until acceptance of appointment by the successor Trustee
pursuant to Section 6.8 and payment of all fees and expenses owed to the
outgoing Trustee.
Notwithstanding the replacement of the Trustee pursuant to this Section, the
Issuer's and the Servicer's obligations under Section 6.7 shall continue for the
benefit of the retiring Trustee.
SECTION 6.9 SUCCESSOR TRUSTEE BY MERGER. If the 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 Trustee. The Trustee shall provide 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 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 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 Trustee may authenticate such Notes either in the name of any predecessor
hereunder or in the name of the successor to the 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 Trustee shall have.
SECTION 6.10 APPOINTMENT OF CO-TRUSTEE OR SEPARATE TRUSTEE. (a)
Notwithstanding any other provisions of this Indenture, at any time, for the
purpose of meeting any legal requirement of any jurisdiction in which any part
of the Trust may at the time be located, the Trustee with the consent of the
Note Insurer (so long as no Insurer Default shall have occurred and be
continuing) shall have the power and may execute and deliver all instruments to
appoint one or more Persons to act as a c trustee or co-trustees, or separate
trustee or separate trustees, of all or any part of the Trust, and to vest in
such Person or Persons, in such capacity and for the benefit of the Noteholders,
such title to the Trust, or any part hereof, and, subject to the other
provisions of this Section, such powers, duties, obligations, rights and trusts
as the Trustee may consider necessary or desirable. No co-trustee or separate
trustee hereunder shall be required to meet the terms of eligibility as a
successor trustee under Section 6.11 and no notice to Noteholders of the
appointment of any co-trustee or separate trustee shall be required under
Section 6.8 hereof.
(b) Every separate trustee and co-trustee shall, to the extent
permitted by law, be appointed and act subject to the following provisions and
conditions:
(i) all rights, powers, duties and obligations conferred or
imposed upon the Trustee shall be conferred or imposed upon and
exercised or performed by the 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 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 Trustee shall be incompetent or unqualified to perform such act or
acts, in which event such rights, powers, duties and obligations
(including the holding of title to the Trust 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
Trustee;
(ii) no trustee hereunder shall be personally liable by reason of
any act or omission of any other trustee hereunder, including acts or
omissions of predecessor or successor trustees; and
(iii)the 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 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 Indenture and the conditions
of this Article VI. Each separate trustee and co-trustee, upon its acceptance of
the trusts conferred, shall be vested with the estates or property specified in
its instrument of appointment, either jointly with the Trustee or separately, as
may be provided therein, subject to all the provisions of this Indenture,
specifically including every provision of this Indenture relating to the conduct
of, affecting the liability of, or affording protection to, the Trustee. Every
such instrument shall be filed with the Trustee.
(d) Any separate trustee or co-trustee may at any time constitute the
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
Indenture on its behalf and in its name. If any separate trustee or co-trustee
shall die, dissolve, become insolvent, become incapable of acting, resign or be
removed, all of its estates, properties, rights, remedies and trusts shall
invest in and be exercised by the Trustee, to the extent permitted by law,
without the appointment of a new or successor trustee.
SECTION 6.11 ELIGIBILITY; DISQUALIFICATION. The Trustee shall at all
times satisfy the requirements of TIAss. 310(a). The Trustee shall have a
combined capital and surplus of at least $50,000,000 as set forth in its most
recent published annual report of condition and it shall have a long term debt
rating of at least BBB- by Standard & Poor's and Baa by Moody's. The Trustee
shall comply with TIAss. 310 (b), including the optional provision permitted by
the second sentence of TIAss. 310(b)(9); provided, however, that there shall be
excluded from the operation of TIAss. 310(b)(1) any indenture or indentures
under which other securities of the Issuer are outstanding if the requirements
for such exclusion set forth in TIAss. 310(b)(1) are met.
SECTION 6.12 PREFERENTIAL COLLECTION OF CLAIMS AGAINST ISSUER. The
Trustee shall comply with TIAss. 311(a), excluding any creditor relationship
listed in TIAss. 311(b). A Trustee who has resigned or been removed shall be
subject to TIAss. 311(a) to the extent indicated.
SECTION 6.13 APPOINTMENT OF CUSTODIANS. (a) The Issuer and the Trustee
may appoint one or more custodians (a "Custodian") to hold all or a portion of
the mortgage files and documents relating to the Loans (a "File") as agent for
the Trustee and perform such other duties on behalf of the Trustee as set forth
in the Sale and Servicing Agreement, by entering into a custodial agreement (a
"Custodial Agreement"). Subject to this Article VI, the Trustee agrees to comply
with the terms of each such Custodial Agreement and to enforce the terms and
provisions thereof against the Custodian for the benefit of the Noteholders, the
Certificateholders and the Note Insurer. The Custodian's fees shall be payable
solely from the fees received by it pursuant to Section 6.7. Each Custodian
shall be a depository institution subject to supervision by federal or state
authority, shall be qualified to do business in the jurisdiction in which it
holds any File.
(b) The Trustee and the Issuer hereby appoint First Union National
Bank as Custodian with respect to the Files relating to all of the Loans that
constitute, or may in the future constitute, part of Pool I and Pool II, and to
perform such other duties as set forth in the Sale and Servicing Agreement on
the terms and conditions set forth in the related Custodial Agreement, which
shall be substantially in the form of Exhibit C attached hereto and made a part
hereof. The Custodian shall be responsible hereunder solely for the express
duties and functions specified for it herein and in the Sale and Servicing
Agreement with respect to the custody, review and confirmation, safekeeping,
substitution and release of the Files relating to the Loans.
(c) The parties hereto agree that the Custodian shall be deemed a
third party beneficiary of this Indenture entitled to all rights and benefits
set forth herein as fully as if it were a party hereto.
SECTION 6.14 EXECUTING BASIC DOCUMENTS. The Trustee is hereby
instructed to execute and deliver the Interest Rate Services Agreement, the
Spread Account Agreement and all other Basic Documents to which the Trustee is a
party.
ARTICLE VII
NOTEHOLDERS' LISTS AND REPORTS
SECTION 7.1 ISSUER TO FURNISH TO TRUSTEE NAMES AND ADDRESSES OF
NOTEHOLDERS. The Issuer will furnish or cause to be furnished to the Trustee (a)
not more than five days after the earlier of (i) each Record Date and (ii) three
months after the last Record Date, a list, in such form as the Trustee may
reasonably require, of the names and addresses of the Holders as of such Record
Date, (b) at such other times as the 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 Trustee is the Note Registrar,
no such list shall be required to be furnished. The Trustee or, if the Trustee
is not the Note Registrar, the Issuer shall furnish to the Note Insurer in
writing on an annual basis on each September 30 (beginning on September 30,
1999) and at such other times as the Note Insurer may request a copy of the
list.
SECTION 7.2 PRESERVATION OF INFORMATION; COMMUNICATIONS TO
NOTEHOLDERS. (a) The Trustee shall preserve, in as current a form as is
reasonably practicable, the names and addresses of the Holders contained in the
most recent list furnished to the Trustee as provided in Section 7.1 and the
names and addresses of Holders received by the Trustee in its capacity as Note
Registrar. The Trustee may destroy any list furnished to it as provided in such
Section 7.1 upon receipt of a new list so furnished.
(b) Noteholders may communicate pursuant to TIA ss. 312(b) with other
Noteholders with respect to their rights under this Indenture or under the
Notes.
(c) The Issuer, the Trustee and the Note Registrar shall have the
protection of TIA ss. 312(c).
SECTION 7.3 REPORTS BY ISSUER. (a) The Issuer shall:
(i) file with the Trustee, 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) which 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 Trustee and the Commission in accordance with
rules and regulations prescribed from time to time by the Commission
such additional information, documents and reports with respect to
compliance by the Issuer with the conditions and covenants of this
Indenture as may be required from time to time by such rules and
regulations; and
(iii) supply to the Trustee (and the Trustee shall transmit by
mail to all Noteholders described in TIA ss. 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 7.3(a) as may
be required 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 7.4 REPORTS BY TRUSTEE. If required by TIA ss. 313(a), within
60 days after each December 31, beginning with December 31, 1999, the Trustee
shall mail to each Noteholder as required by TIA ss. 313(c) a brief report dated
as of such date that complies with TIA ss. 313(a). The Trustee also shall comply
with TIA ss. 313(b).
A copy of each report at the time of its mailing to Noteholders shall
be filed by the Trustee with the Commission, if required by the Exchange Act,
and each stock exchange, if any, on which the Notes are listed. The Issuer shall
notify the Trustee if and when the Notes are listed on any stock exchange.
ARTICLE VIII
ACCOUNTS, DISBURSEMENTS AND RELEASES
SECTION 8.1 COLLECTION OF MONEY. Except as otherwise expressly
provided herein, the 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 Trustee pursuant to this Indenture. The Trustee shall apply
all such money received by it as provided in this Indenture. Except as otherwise
expressly provided in this Indenture, if any default occurs in the making of any
payment or performance under any agreement or instrument that is part of the
Trust Estate, the Trustee may take such action as may be appropriate to enforce
such payment or performance, including the institution and prosecution of
appropriate proceedings. Any such action shall be without prejudice to any right
to claim a Default or Event of Default under this Indenture and any right to
proceed thereafter as provided in Article V.
SECTION 8.2 TRUST ACCOUNTS. (a) On or prior to the Closing Date, the
Issuer shall cause the Servicer to establish and maintain, in the name of the
Trustee, for the benefit of the Noteholders, the Certificateholders and the Note
Insurer, the Trust Accounts as provided in Section 7.01 of the Sale and
Servicing Agreement.
(b) On or before each Remittance Date, all funds required to be
deposited in the Principal and Interest Account, with respect to the preceding
Due Period, will be deposited in the Principal and Interest Account as provided
in Section 4.03 of the Sale and Servicing Agreement. On or before each
Remittance Date, the Available Remittance Amount (net of any Compensating
Interest or Monthly Advances) with respect to the preceding Due Period will be
transferred from the Principal and Interest Account to the respective Note
Distribution Accounts as provided in Sections 4.04(a) and 7.01 of the Sale and
Servicing Agreement.
(c) On each Remittance Date and Redemption Date, the Trustee shall
distribute all amounts on deposit in each Note Distribution Account to the
respective Class of Noteholders in respect of such Class of Notes, and to the
Owner Trustee, or the Paying Agent under the Trust Agreement on its behalf, for
distribution to the Holders of the Certificates in accordance with the
provisions of Section 7.05 of the Sale and Servicing Agreement.
SECTION 8.3 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 Permitted
Instruments and reinvested by the Trustee upon Issuer Order, subject to the
provisions of Section 4.03 of the Sale and Servicing Agreement. All income or
other gain from investments of moneys deposited in the Trust Accounts shall be
deposited (or caused to be deposited) by the Trustee in the Principal and
Interest Account, and any loss resulting from such investments shall be charged
to such account. The Issuer will not direct the 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, and, in connection with any direction
to the Trustee to make any such investment or sale, if requested by the Trustee,
the Issuer shall deliver to the Trustee and the Note Insurer an Opinion of
Counsel, acceptable to the Trustee and the Note Insurer, to such effect.
(b) [Reserved]
(c) Subject to Section 6.1(c), the 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 for
losses attributable to the Trustee's failure to make payments on such Permitted
Instruments issued by the Trustee, in its commercial capacity as principal
obligor and not as trustee, in accordance with their terms.
(d) If (i) the Issuer shall have failed to give investment directions
for any funds on deposit in the Trust Accounts to the Trustee by 11:00 a.m.
Eastern Time (or such other time as may be agreed by the Issuer and Trustee) on
any Business Day; or (ii) a Default or Event of Default shall have occurred and
be continuing with respect to the Notes but the Notes shall not have been
declared due and payable pursuant to Section 5.2, or, (iii) if such Notes shall
have been declared due and payable following an Event of Default but amounts
collected or receivable from the Trust Estate are being applied in accordance
with Section 5.5 as if there had not been such a declaration; then the Trustee
shall, to the fullest extent practicable, invest and reinvest funds in the Trust
Accounts in one or more Permitted Instruments.
SECTION 8.4 RELEASE OF TRUST ESTATE. (a) Subject to the payment of its
fees and expenses pursuant to Section 6.7, the Trustee may, and when required by
the provisions of this Indenture shall, execute instruments to release property
from the lien of this Indenture, or convey the Trustee's interest in the same,
in a manner and under circumstances that are not inconsistent with the
provisions of this Indenture. No party relying upon an instrument executed by
the Trustee as provided in this Article VIII shall be bound to ascertain the
Trustee's authority, inquire into the satisfaction of any conditions precedent
or see to the application of any moneys.
(b) The Trustee shall, at such time as there are no Notes outstanding
and all sums due the Trustee pursuant to Section 6.7 have been paid, release any
remaining portion of the Trust Estate 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 Trustee shall release
property from the lien of this Indenture pursuant to this Section 8.4(b) only
upon receipt 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 TIAss. 314(c) and 314(d)(1) meeting the applicable requirements
of Section 11.1.
SECTION 8.5 OPINION OF COUNSEL. The Trustee shall receive at least
seven days' notice when requested by the Issuer to take any action pursuant to
Section 8.4(a), accompanied by copies of any instruments involved, and the
Trustee shall also require as a condition to such action, an Opinion of Counsel
(if required by the TIA), in form and substance satisfactory to the Trustee,
stating the legal effect of any such action, outlining the steps required to
complete the same, and concluding that all conditions precedent to the taking of
such action have been complied with and such action will not materially and
adversely impair the security for the Notes or the rights of the Noteholders in
contravention of the provisions of this Indenture; provided, however, that such
Opinion of Counsel shall not be required to express an opinion as to the fair
value of the Trust Estate. Counsel rendering any such opinion may rely, without
independent investigation, on the accuracy and validity of any certificate or
other instrument delivered to the Trustee in connection with any such action.
ARTICLE IX
SUPPLEMENTAL INDENTURES
SECTION 9.1 SUPPLEMENTAL INDENTURES WITHOUT CONSENT OF NOTEHOLDERS.
(a) Without the consent of the Holders of any Notes but with the consent of the
Note Insurer (unless an Insurer Default shall have occurred and be continuing)
and with prior notice to the Rating Agencies by the Issuer, as evidenced to the
Trustee, the Issuer and the 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
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 Trustee any property subject or required
to be subjected to the lien of this Indenture, or to subject to the
lien of this Indenture additional property;
(ii) to evidence the succession, in compliance with the
applicable provisions hereof, of another person to the Issuer, and the
assumption by any such successor of the covenants of the Issuer herein
and in the Notes contained;
(iii) to add to the covenants of the Issuer, for the benefit of
the Holders of the Notes, or 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 Trustee;
(v) to cure any ambiguity, to correct or supplement any provision
herein or in any supplemental indenture which may be inconsistent with
any other provision herein or in any supplemental indenture or to make
any other provisions with respect to matters or questions arising
under this Indenture or in any supplemental indenture; PROVIDED that
such action shall not adversely affect in any material respect 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; 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. The 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 Trustee, when authorized by an Issuer Order,
may, also without the consent of any of the Holders of the Notes but with the
prior written consent of the Note Insurer and prior notice to the Rating
Agencies by the Issuer, as evidenced to the 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 such action shall not, as evidenced by an
Opinion of Counsel, adversely affect in any material respect the interests of
any Noteholder.
SECTION 9.2 SUPPLEMENTAL INDENTURES WITH CONSENT OF NOTEHOLDERS. The
Issuer and the Trustee, when authorized by an Issuer Order, also may, with prior
notice to the Rating Agencies and with the consent of the Note Insurer (unless
an Insurer Default shall have occurred and be continuing), and with the consent
of the Holders of not less than a majority of the outstanding Amount of the
Notes, by Act of such Holders delivered to the Issuer and the 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 subject to
the express rights of the Note Insurer under the Basic Documents no such
supplemental indenture shall, without the consent of the Holder of each
Outstanding Note affected thereby:
(i) change the date of payment of any installment of principal of
or interest on any Note, or reduce the principal amount thereof, the
interest rate thereon or the Redemption Price with respect thereto,
change the provision of this Indenture relating to the application of
collections on, or the proceeds of the sale of, the Trust Estate to
payment of principal of or interest on the Notes, or change any place
of payment where, or the coin or currency in which, any Note or the
interest thereon is payable;
(ii) impair the right to institute suit for the enforcement of
the provisions of this Indenture requiring the application of funds
available therefor, as provided in Article V, to the payment of any
such amount due on the Notes on or after the respective due dates
thereof (or, in the case of redemption, on or after the Redemption
Date);
(iii) reduce the percentage of the Outstanding Amount of the
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;
(iv) modify or alter the provisions of the proviso to the
definition of the term "Outstanding";
(v) reduce the percentage of the Outstanding Amount of the Notes
required to direct the Trustee to direct the Issuer to sell or
liquidate the Trust Estate pursuant to Section 5.4;
(vi) 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;
(vii) 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 Remittance 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
(viii) permit the creation of any lien ranking prior to or on a
parity with the lien of this Indenture with respect to any part of the
Trust Estate or, except as otherwise permitted or contemplated herein
or in the Basic Documents, 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 Trustee may, based upon an Opinion of Counsel delivered to it,
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 Trustee shall not be liable for any such determination made in good faith.
It shall not be necessary for any Act of Noteholders under this
Section to approve the particular form of any proposed supplemental indenture,
but it shall be sufficient if such Act shall approve the substance thereof.
Promptly after the execution by the Issuer and the Trustee of any
supplemental indenture pursuant to this Section, the 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. Any failure of the Trustee to mail such notice, or any defect
therein, shall not, however, in any way impair or affect the validity of any
such supplemental indenture.
SECTION 9.3 EXECUTION OF SUPPLEMENTAL INDENTURES. In executing, or
permitting the additional trusts created by, any supplemental indenture
permitted by this Article IX or the modifications thereby of the trusts created
by this Indenture, the Trustee shall be entitled to receive, and subject to
Sections 6.1 and 6.2, 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 Trustee may, but shall not be obligated to,
enter into any such supplemental indenture that affects the Trustee's own
rights, duties, liabilities or immunities under this Indenture or otherwise. The
Trustee shall provide copies of each such supplemental indenture to each of the
Rating Agencies.
SECTION 9.4 EFFECT OF SUPPLEMENTAL INDENTURE. Upon the execution of
any supplemental indenture pursuant to the provisions hereof, this Indenture
shall be and 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 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 9.5 CONFORMITY WITH TRUST INDENTURE ACT. Every amendment of
this Indenture and every supplemental indenture executed pursuant to this
Article IX shall conform to the requirements of the Trust Indenture Act as then
in effect so long as this Indenture shall then be qualified under the Trust
Indenture Act.
SECTION 9.6 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 Trustee shall, bear a
notation in form approved by the Trustee as to any matter provided for in such
supplemental indenture. If the Issuer or the Trustee shall so determine, new
Notes so modified as to conform, in the opinion of the Trustee and the Issuer,
to any such supplemental indenture may be prepared and executed by the Issuer
and authenticated and delivered by the Trustee in exchange for Outstanding
Notes.
ARTICLE X
REDEMPTION OF NOTES
SECTION 10.1 REDEMPTION. (a) The Notes are subject to redemption in
whole, but not in part, at the direction of the Representative pursuant to
Section 11.01 of the Sale and Servicing Agreement, on any Remittance Date on
which the Representative exercises its option to purchase the Trust Estate
pursuant to said Section 11.01. The purchase price for the Notes shall be equal
to the Redemption Price; PROVIDED, HOWEVER, that the Issuer has available funds
sufficient to pay the Redemption Price. The Servicer shall furnish the Rating
Agencies and the Note Insurer notice of such redemption. If the Notes are to be
redeemed pursuant to this Section 10.1(a) (i) or (ii), the Servicer shall
furnish notice to the Trustee not later than 25 days prior to the Redemption
Date and the Issuer shall deposit with the Trustee in the Pool I Note
Distribution Account and Pool II Note Distribution Account, as the case may be,
on or before the Redemption Date, the Redemption Price of the respective Class
AF Notes or Class AV Notes to be redeemed whereupon all such Notes shall be due
and payable on the Redemption Date upon the furnishing of a notice complying
with Section 10.2 to each Holder of the Notes.
(b) In the event that the assets of the Trust are sold pursuant to
Section 9.2 of the Trust Agreement, all amounts on deposit in the Pool I Note
Distribution Account and Pool II Note Distribution Account, as the case may be,
shall be paid to the respective Class AF Noteholders or Class AV Noteholders up
to the Outstanding Amount of the respective Class of Notes and all accrued and
unpaid interest thereon, and the Note Insurer shall receive all amounts then
owing to it. If amounts are to be paid to Noteholders pursuant to this Section
10.1(b), the Servicer or the Issuer shall, to the extent practicable, furnish
notice of such event to the Trustee and the Note Insurer not later than 25 days
prior to the Redemption Date whereupon all such amounts shall be payable on the
Redemption Date.
SECTION 10.2 FORM OF REDEMPTION NOTICE. (a) Notice of redemption under
Section 10.1(a) shall be given by the Trustee by facsimile or by first-class
mail, postage prepaid, transmitted or mailed not less than five days in the case
of Section 10.1(a)(i) and Section 10.1(a)(ii) prior to the applicable Redemption
Date to each Holder of Notes, as of the close of business on the Record Date
preceding the applicable Redemption Date, at such Holder's address appearing in
the Note Register.
All notices of redemption shall state:
(i) the Redemption Date;
(ii) the Redemption Price;
(iii) that the Record Date otherwise applicable to such
Redemption Date is not applicable and that payments shall be made only
upon presentation and surrender of such Notes and the place where such
Notes are to be surrendered for payment of the Redemption Price (which
shall be the office or agency of the Issuer to be maintained as
provided in Section 3.2); and
(iv) that interest on the Notes shall cease to accrue on the
Redemption Date. Notice of redemption of the Notes shall be given by
the Trustee in the name and at the expense of the Issuer. Failure to
give notice of redemption, or any defect therein, to any Holder of any
Note shall not impair or affect the validity of the redemption of any
other Note.
(b) Prior notice of redemption under Sections 10.1(b) is not required
to be given to Noteholders.
SECTION 10.3 NOTES PAYABLE ON REDEMPTION DATE. The Notes to be
redeemed shall, following notice of redemption as required by Section 10.2 (in
the case of redemption pursuant to Section 10.1(a)), on the Redemption Date
become due and payable at the Redemption Price and (unless the Issuer shall
default in the payment of the Redemption Price) no interest shall accrue on the
Redemption Price for any period after the date to which accrued interest is
calculated for purposes of calculating the Redemption Price.
ARTICLE XI
MISCELLANEOUS
SECTION 11.1 COMPLIANCE CERTIFICATES AND OPINIONS, ETC. (a) Upon any
application or request by the Issuer to the Trustee to take any action under any
provision of this Indenture, the Issuer shall furnish to the Trustee and to 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:
(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) (i) Prior to the deposit of any Collateral or other property
or securities with the 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 11.1(a) or elsewhere in this Indenture, furnish to the 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 deposit) to the Issuer of the Collateral
or other property or securities to be so deposited.
(ii) Whenever the Issuer is required to furnish to the Trustee
and the Note Insurer an Officer's Certificate certifying or stating
the opinion of any signer thereof as to the matters described in
clause (i) above, the Issuer shall also deliver to the Trustee an
Independent Certificate as to the same matters, if the fair value to
the Issuer of the securities to be so deposited and of all other such
securities made the basis of any such withdrawal or release since the
commencement of the then-current fiscal year of the Issuer, as set
forth in the certificates delivered pursuant to clause (i) above and
this clause (ii), is 10% or more of the 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 $25,000
or less than one percent of the Outstanding Amount of the Notes.
(iii) Other than with respect to the release of any Deleted Loans
or Liquidated Loans, whenever any property or securities are to be
released from the lien of this Indenture, the Issuer shall also
furnish to the 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.
(iv) Whenever the Issuer is required to furnish to the Trustee an
Officer's Certificate certifying or stating the opinion of any signer
thereof as to the matters described in clause (iii) above, the Issuer
shall also furnish to the Trustee an Independent Certificate as to the
same matters if the fair value of the property or securities and of
all other property other than Deleted Loans and Liquidated Loans, or
securities released from the lien of this Indenture since the
commencement of the then current calendar year, as set forth in the
certificates required by clause (iii) above and this clause (iv),
equals 10% or more of the 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 $25,000 or less than one
percent of the then Outstanding Amount of the Notes.
(v) Notwithstanding Section 2.9 or any other provision of this
Section, the Issuer may (A) collect, liquidate, sell or otherwise
dispose of Loans and other Collateral as and to the extent permitted
or required by the Basic Documents and (B) make cash payments out of
the Trust Accounts as and to the extent permitted or required by the
Basic Documents.
SECTION 11.2 FORM OF DOCUMENTS DELIVERED TO TRUSTEE. In any case where
several matters are required to be certified by, or covered by an opinion of,
any specified Person, it is not necessary that all such matters be certified by,
or covered by the opinion of, only one such Person, or that they be so certified
or covered by only one document, but one such Person may certify or give an
opinion with respect to some matters and one or more other such Persons as to
other matters, and any such Person may certify or give an opinion as to such
matters in one or several documents.
Any certificate or opinion of an Authorized Officer of the Issuer may
be based, insofar as it relates to legal matters, upon a certificate or opinion
of, or representations by, counsel, unless such officer knows, or in the
exercise of reasonable care should know, that the certificate or opinion or
representations with respect to the matters upon which his or her 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 Representative or the Issuer, stating that the information
with respect to such factual matters is in the possession of the Servicer, the
Representative or the Issuer, unless such counsel knows, or in the exercise of
reasonable care should know, that the certificate or opinion or representations
with respect to such matters are erroneous.
Where any Person is required to make, give or execute two or more
applications, requests, consents, certificates, statements, opinions or other
instruments under this Indenture, they may, but need not, be consolidated and
form one instrument.
Whenever in this Indenture, in connection with any application or
certificate or report to the 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 Trustee's right to rely upon the truth and accuracy of
any statement or opinion contained in any such document as provided in Article
VI.
SECTION 11.3 ACTS OF NOTEHOLDERS. (a) Any request, demand,
authorization, direction, notice, consent, waiver or other action provided by
this Indenture to be given or taken by Noteholders may be embodied in and
evidenced by one or more instruments of substantially similar tenor signed by
such Noteholders in person or by agents duly appointed in writing; and except as
herein otherwise expressly provided such action shall become effective when such
instrument or instruments are delivered to the 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 6.1)
conclusive in favor of the 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 customary manner of the Trustee.
(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
Trustee or the Issuer in reliance thereon, whether or not notation of such
action is made upon such Note.
SECTION 11.4 NOTICES, ETC., TO TRUSTEE, ISSUER AND RATING AGENCIES.
Any request, demand, authorization, direction, notice, consent, waiver or Act of
Noteholders or other documents provided or permitted by this Indenture to be
made upon, given or furnished to or filed with:
(a) The Trustee by any Noteholder or by the Issuer shall be sufficient
for every purpose hereunder if personally delivered, delivered by overnight
courier or mailed certified mail, return receipt requested and shall be deemed
to have been duly given upon receipt to the Trustee at its Corporate Trust
Office, or
(b) The Issuer by the Trustee or by any Noteholder shall be in writing
and sufficient for every purpose hereunder if personally delivered, delivered by
overnight courier or mailed certified mail, return receipt requested and shall
be deemed to have been duly given upon receipt to the Issuer addressed to: The
Money Store Trust 1998-C, in care of the Owner Trustee, Attention: Corporate
Trust Administration at the address of the Owner Trustee's Corporate Trust
Office set forth in the Trust Agreement or at any other address previously
furnished in writing to the Trustee by Issuer. The Issuer shall promptly
transmit any notice received by it from the Noteholders to the Trustee, or
(c) The Note Insurer by the Issuer or the Trustee shall be sufficient
for any purpose hereunder if in writing and mailed by registered mail or
personally delivered or telexed or telecopied to the recipient as follows: to
the Note Insurer: MBIA Insurance Corporation, 000 Xxxx Xxxxxx, Xxxxxx, Xxx Xxxx
00000, Attention: Insured Portfolio Management - SF (Mortgage-Backed) (The Money
Store Trust 1998-C), Fax: 000-000-0000, Ph: 000-000-0000.
Notices required to be given to the Rating Agencies by the Issuer, the
Trustee or the Owner Trustee shall be in writing, personally delivered,
delivered by overnight courier or mailed certified mail, return receipt
requested to (i) in the case of Moody's, at the following address: Xxxxx'x
Investors Service, Inc., 00 Xxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention:
Structured Finance and (ii) in the case of S&P, at the following address:
Standard & Poor's a division of the XxXxxx-Xxxx Companies, Inc., 00 Xxxxxxxx
(00xx Xxxxx), Xxx Xxxx, Xxx Xxxx 00000, Attention of Asset Backed Surveillance
Department; or as to each of the foregoing, at such other address as shall be
designated by written notice to the other parties.
SECTION 11.5 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 here
in provided shall conclusively be presumed to have been duly 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 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 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 11.6 ALTERNATE PAYMENT AND NOTICE PROVISIONS. Notwithstanding
any provision of this Indenture or any of the Notes to the contrary, the Issuer
may enter into any agreement with any Holder of a Note providing for a method of
payment, or notice by the Trustee or any Paying Agent to such Holder, that is
different from the methods provided for in this Indenture for such payments or
notices, provided that such methods are reasonable and consented to by the
Trustee (which consent shall not be unreasonably withheld). The Issuer will
furnish to the Trustee a copy of each such agreement and the Trustee will cause
payments to be made and notices to be given in accordance with such agreements.
SECTION 11.7 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 xx.xx. 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 11.8 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 11.9 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 Trustee in this
Indenture shall bind its successors.
SECTION 11.10 SEPARABILITY. In case any provision in this Indenture or
in the Notes shall be invalid, illegal or unenforceable, the validity, legality,
and enforceability of the remaining provisions shall not in any way be affected
or impaired thereby.
SECTION 11.11 BENEFITS OF INDENTURE. The Note Insurer and its
successors and assigns shall be a third-party beneficiary to the provisions of
this Indenture, and shall be entitled to rely upon and directly to enforce such
provisions of this Indenture so long as no Insurer Default shall have occurred
and be continuing.
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 Trust Estate, any
benefit or any legal or equitable right, remedy or claim under this Indenture.
The Note Insurer may disclaim any of its rights and powers under this Indenture
(in which case the Trustee may exercise such right or power hereunder), but not
its duties and obligations under the Note Policies, upon delivery of a written
notice to the Trustee.
SECTION 11.12 LEGAL HOLIDAYS. In any case where the date on which any
payment is due shall not be a Business Day, then (notwithstanding any other
provision of the Notes or this Indenture) payment need not be made on such date,
but may be made on the next succeeding Business Day with the same force and
effect as if made on the date an which nominally due, and no interest shall
accrue for the period from and after any such nominal date.
SECTION 11.13 GOVERNING LAW. THIS INDENTURE SHALL BE CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REFERENCE TO ITS
CONFLICT OF LAW PROVISIONS, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE
PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
SECTION 11.14 COUNTERPARTS. This Indenture may be executed in any
number of counterparts, each of which so executed shall be deemed to be an
original, but all such counterparts shall together constitute but one and the
same instrument.
SECTION 11.15 RECORDING OF INDENTURE. If this Indenture is subject to
recording in any appropriate public recording offices, such recording is to be
effected by the Issuer and at its expense accompanied by an Opinion of Counsel
(which may be counsel to the Trustee or any other counsel reasonably acceptable
to the 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
Trustee under this Indenture.
SECTION 11.16 TRUST OBLIGATION. No recourse may be taken, directly or
indirectly, with respect to the obligations of the Issuer, the Representative,
the Servicer, the holder of the Special Interest, the Owner Trustee or the
Trustee on the Notes or under this Indenture or any certificate or other writing
delivered in connection herewith or therewith, against (i) the Representative,
the Servicer, the holder of the Special Interest, the 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 Representative, the Servicer, the holder of the Special
Interest, the Trustee or the Owner Trustee in its individual capacity, any
holder of a beneficial interest in the Issuer, the Representative, the Servicer,
the holder of the Special Interest, the Owner Trustee or the Trustee or of any
successor or assign of the Representative, the Servicer, the holder of the
Special Interest, the Trustee or the Owner Trustee in its individual capacity,
except as any such Person may have expressly agreed (it being understood that
the 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 the
Trust Agreement.
SECTION 11.17 NO PETITION. The Trustee, by entering into this
Indenture, and each Noteholder, by accepting a Note, hereby covenant and agree
that they will not at any time, prior to the date that is one year and a day
after the termination of the Indenture, institute against the Representative,
the holder of the Special Interest or the Trust, or join in any institution
against the Representative, the holder of the Special Interest or the Trust 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 11.18 INSPECTION. The Issuer agrees that, on reasonable prior
notice, it will permit any representative of the 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 be reasonably requested. The
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 Trustee may reasonably determine that such disclosure is
consistent with its Obligations hereunder.
SECTION 11.19 USURY. The amount of interest payable or paid on any
Note under the terms of this Indenture shall be limited to an amount which shall
not exceed the maximum non usurious rate of interest allowed by the State of New
York or Delaware (whichever shall permit the lower rate) which could lawfully be
contracted for, charged or received (the "Highest Lawful Rate"). If any payment
of interest on any Note exceeds the Highest Lawful Rate, the Issuer stipulates
that such excess amount will be deemed to have been paid as a result of an error
on the part of both the Trustee, acting on behalf of the Holder of such Note,
and the Issuer, and the Noteholder receiving such excess payment shall promptly,
upon discovery of such error or upon notice thereof from the Issuer or the
Trustee, refund the amount of such excess and, at the option of the Trustee,
apply the excess to the payment of principal of such Note, if any, remaining
unpaid.
[THIS SPACE LEFT INTENTIONALLY BLANK]
IN WITNESS WHEREOF, the Issuer and the Trustee have caused this
Indenture to be duly executed by their respective officers, thereunto duly
authorized, all as of the day and year first above written.
THE MONEY STORE TRUST 1998-C,
By: CHASE MANHATTAN BANK DELAWARE,
not in its individual capacity but
solely as Owner Trustee
By: /s/ XXXXX XXXXX
----------------------------------
Name: Xxxxx Xxxxx
Title: Trust Officer
THE BANK OF NEW YORK,
not in its individual capacity
but solely as Trustee,
By: /s/ XXXXXX X. XXXXXX
----------------------------------
Name: Xxxxxx X. Xxxxxx
Title: Assistant Vice President
Acceptance of Custodian
First Union National Bank, a national banking association
headquartered in Charlotte, North Carolina, hereby accepts its appointment
pursuant to Section 6.13(b) of the within instrument to serve as Custodian with
respect to the Loans. The Files relating to the Loans initially will be kept in
our offices located in North Highlands, California. In connection therewith,
First Union National Bank agrees to be bound by all applicable provisions of the
Indenture and the Sale and Servicing Agreement.
FIRST UNION NATIONAL BANK, as Custodian
By: /s/ XXXXXX XXXX
----------------------------------
Name: Xxxxxx Xxxx
Title: Vice President
SCHEDULE I
AUCTION PROCEDURES
DEFINITIONS
Capitalized terms used herein and not otherwise defined have the meanings
ascribed in the Sale and Servicing Agreement and the Indenture. Additionally,
the following terms have the meanings ascribed to them (the term "Security" as
used in this Schedule I refers to the Class AF-2 Notes and the term
"Securityholder" refers to Holders of Class AF-2 Notes).
"All Hold Rate" means ninety percent (90%) of One-Month LIBOR.
"Auction" means the implementation of the Auction Procedures on an Auction
Date.
"Auction Date" means, with respect to the Initial Period for each Class of
Securities, October 14, 1998 and thereafter, the Business Day immediately
preceding the first day of each Auction Period for each Security, other than:
(A) each Auction Period commencing after the ownership of the Securities
is no longer maintained in Book-Entry Form by DTC;
(B) each Auction Period commencing after and during the continuance of an
Event of Default; or
(C) each Auction Period commencing less than two Business Days after the
cure or waiver of an Event of Default.
Notwithstanding the foregoing, the Auction Date for one or more Auction Periods
may be changed as described herein.
"Auction Period" means, with respect to each Security, the Interest Period
applicable to such Security during which time the applicable Security Interest
Rate is determined pursuant to the Indenture.
"Auction Period Adjustment" means an adjustment to the Auction Period as
described herein.
"Auction Procedures" means the procedures set forth and described herein by
which the Auction Rate applicable to a Security is determined.
"Auction Rate" means, with respect to any Security, the rate of interest
pre annum that results from the implementation of the Auction Procedures and is
determined as described herein.
"Estimated Range of Interest Rate" has the meaning as set forth herein.
"Initial Period" means, as to any Security, the period commencing on the
Closing Date of such Security and continuing through the day immediately
preceding the Security Initial Rate Adjustment Date for such Security.
"Interest Period" means, with respect to a Security, the Initial Period for
such Security and each period commencing on the Rate Adjustment Date for such
Security and ending on the day before (i) the next Rate Adjustment Date for such
Security or (ii) the final maturity date of such Security, as applicable.
"Interest Rate Services Agreement" means the initial Interest Rate Services
Agreement unless and until a substitute Interest Rate Services Agreement is
entered into, after with
"Interest Rate Services Agreement" shall mean such substitute Interest Rate
Services Agreement.
"Maximum Auction Rate" generally means the lesser of (i) either (A)
One-Month LIBOR plus 0.40% (if both ratings assigned by the Rating Agencies to
the applicable Security are "Aa3" or "AA-" or better) or (B) One-Month LIBOR
plus 1.25% (if any one of the ratings assigned by the Rating Agencies to the
Security is less than "Aa3" or "AA-") or (ii) 14.00%. For purposes of the
Remarketing Agent and the Remarketing Agent has been given notice pursuant to
the Interest Rate Services Agreement.
"Non-Payment Rate" means the then applicable Maximum Auction Rate.
"One-Month LIBOR" means LIBOR as defined in the Sale and Servicing
Agreement.
"Rate Adjustment Date" means, with respect to each Security, the date on
which the applicable Security Interest Rate is effective and means, with respect
to each such Security, the date of commencement of each Auction Period.
"Rate Determination Date" means, with respect to any Security, the Auction
Date, or if no Auction Date is applicable to such Security, the Business Day
immediately preceding the date of commencement of an Auction Period.
"Remarketing Agent" means the initial remarketing agent under the initial
Interest Rate Services Agreement unless and until a substitute Interest Rate
Services Agreement becomes effective, after which "Remarketing Agent" shall mean
the substitute remarketing agent.
"Remarketing Agent Fee" has the meaning set forth in the Interest Rate
Services Agreement.
"Security Initial Rate" means, with respect to any Security, the rate at
which interest accrues on such Security during the Initial Period.
"Security Initial Rate Adjustment Date" means October 15, 1998.
SECTION 1.1. CLASS REMITTANCE RATE.
SECTION 1.1.1. DETERMINING THE CLASS REMITTANCE RATE FOR THE AUCTION RATE
NOTES.
Promptly after the Remarketing Agent has made the determinations described
in Section 1.1.3, the Remarketing Agent is to advise the Indenture Trustee of
the Maximum Auction Rate, the All Hold Rate and the components thereof on the
Auction Date, and based on such determinations, the Auction Rate for the next
succeeding Interest Period for the Auction Rate Notes.
Promptly after the Remarketing Agent has determined the Auction Rate, the
Remarketing Agent will determine and advise the Indenture Trustee of such
Auction Rate for the Auction Rate Notes, which rate will be the lesser of (a)
the Maximum Auction Rate for the Auction Rate Notes and (b) the rate established
by the Remarketing Agent for the Class AF-2 Notes (the "Auction Rate Notes") no
later than 1:00 p.m., New York City time, on the Auction Date immediately
preceding each Interest Period for the Auction Rate Notes as being the minimum
rate of interest that would be necessary, in the best professional judgment of
the Remarketing Agent, taking into account prevailing market conditions, to sell
all of the Auction Rate Notes for the next succeeding Interest Period on such
date in the secondary market at a price equal to the principal amount thereof
for settlement on the next succeeding Remittance Date for the Auction Rate
Notes.
In the process of taking into account prevailing market conditions, the
Remarketing Agent shall take, among other actions it may deem appropriate, the
following actions. Not more than one Business Day before the Auction Date, the
Remarketing Agent shall make available to all interested parties an estimated
range of interest rates for the Auction Rate Notes for the next ensuing Interest
Period (the "Estimated Range of Interest Rate"). The Remarketing Agent shall
then inquire of owners of the Auction Rate Notes that communicate with the
Remarketing Agent as to whether or not such owners choose to continue to hold
their Auction Rate Notes at the Estimated Range of Interest Rate or, if not, as
to the specific interest rate, if any, at which such owners would choose to
continue to hold such Auction Rate Notes. The Remarketing Agent shall thereupon
establish the Auction Rate for the Auction Rate Notes for the next ensuing
Auction Period or Periods and communicate the same to the parties and in the
manner required by the Auction Procedures.
For each Auction Date, the Indenture Trustee shall notify the Remarketing
Agent of the principal amount of Auction Rate Notes outstanding not later than
the Business Day preceding each Auction Date. The Remarketing Agent will accept
bids that satisfy the lowest possible bid for all outstanding Auction Rate Notes
and will allocate payments accordingly. In accordance with DTC's normal
procedures, on the Business Day after the Auction Date, the transactions
described above will be executed through DTC, so long as DTC is the depository,
and the accounts of the respective Participants at DTC will be debited and
credited and the Auction Rate Notes delivered as necessary to effect the
purchases and sales of the Auction Rate Notes as determined in the Auction.
Purchasers are required to make payment through their Participants in same-day
funds to DTC against delivery through their Participants. DTC will make payment
in accordance with its normal procedures, which now provide for payment against
delivery by its Participants in immediately available funds.
SECTION 1.1.2. INSURER DEFAULT; REMARKETING AGENT FEES AND EXPENSES.
(a) The Indenture Trustee shall determine not later than 2:00 p.m., eastern
time, on the Business Day succeeding a Remittance Date, whether a Note Insurer
Default has occurred. If an Insurer Default has occurred, the Indenture Trustee
shall, not later than 2:15 p.m., eastern time, on such Business Day, send a
notice thereof to the Remarketing Agent, the Representative and the Note Insurer
by telecopy or similar means and, if such Insurer Default is cured, the
Indenture Trustee shall immediately send a notice to the Remarketing Agent, the
Representative and the Note Insurer by telecopy or similar means.
(b) Not later than 2:00 p.m., eastern time, on each Remittance Date , the
Indenture Trustee shall pay to the Remarketing Agent, in immediately available
funds out of amounts in the Expense Account an amount equal to the Remarketing
Agent Fee as calculated in the Interest Rate Services Agreement. The
Representative shall from time to time at the request of the Remarketing Agent
reimburse the Remarketing Agent for its reasonable expenses as provided in the
Interest Rate Services Agreement.
SECTION 1.1.3. CALCULATION OF MAXIMUM AUCTION RATE, ALL HOLD RATE,
THREE-MONTH LIBOR AND NON-PAYMENT RATE.
The Remarketing Agent will calculate the Maximum Auction Rate, the All Hold
Rate and One-Month LIBOR on each Auction Date. If the ownership of a Class of
Auction Rate Notes is no longer maintained in Book-Entry Form, the Indenture
Trustee will calculate the Maximum Auction Rate, on the Business Day immediately
preceding the first day of each Interest Period commencing after delivery of
such Class of Auction Rate Notes. If the Note Insurer is in default under the
Note Insurance Policies, the Indenture Trustee will calculate the Non-Payment
Rate on the Class Rate Determination Date for (i) each Interest Period
commencing after the occurrence and during the continuance of such Insurer
Default and (ii) any Interest Period commencing less than two Business Days
after the cure of such Event of Default. The Remarketing Agent will determine
One-Month LIBOR for each Interest Period other than the Initial Period for a
Class of Auction Rate Notes; provided, that if the ownership of the Auction Rate
Notes is no longer maintained in Book-Entry Form, or if an Insurer Default has
occurred and is continuing, then the Indenture Trustee will determine One-Month
LIBOR for each such Interest Period. The determination by the Indenture Trustee
or the Remarketing Agent, as the case may be, of One-Month LIBOR will (in the
absence of manifest error) be final and binding upon the Noteholders and all
other parties. If calculated or determined by the Remarketing Agent, the
Remarketing Agent will promptly advise the Indenture Trustee of One-Month LIBOR.
SECTION 1.1.4. NOTIFICATION OF RATES, AMOUNTS OF REMITTANCE DATES.
Promptly after the Closing Date and after the beginning of each subsequent
Interest Period relating to each Class of Auction Rate Notes, and in any event
at least 10 days prior to any Remittance Date relating to a Class of Auction
Rate Notes, the Indenture Trustee shall confirm with the Remarketing Agent, so
long as no Note Insurer Default has occurred and is continuing and the ownership
of the Auction Rate Notes is maintained in Book-Entry Form by the Depository,
(1) the date of such next Remittance Date relating to a Class of Auction Rate
Notes and (2) the amount payable to the Remarketing Agent on the Auction Date
pursuant to Section 2.1.2(b) hereof.
If any day scheduled to be a Remittance Date shall be changed after the
Indenture Trustee shall have given the notice or confirmation referred to in the
preceding sentence, the Indenture Trustee shall, not later than 9:15 a.m.,
eastern time, on the Business Day next preceding the earlier of the new
Remittance Date or the old Remittance Date, by such means as the Indenture
Trustee deems practicable, give notice of such change to the Remarketing Agent,
so long as no Note Insurer Default has occurred and is continuing and the
ownership of the Auction Rate Notes is maintained in Book-Entry Form by the
Depository.
SECTION 1.1.5. REMARKETING AGENT. First Union Capital Markets, a division
of Wheat First Securities, Inc. ("First Union Capital Markets") is hereby
appointed as initial Remarketing Agent to serve as agent for the Representative
in connection with Auctions. The Indenture Trustee is hereby directed to, enter
into the initial Interest Rate Services Agreement with First Union Capital
Markets. The Remarketing Agent may, with the consent of the Representative and
the Note Insurer and notice to the Indenture Trustee and designation of the
party authorized to direct the Indenture Trustee, enter into an agreement with
one or more co-remarketing agents under which certain duties of the Remarketing
Agent may be delegated to the co-remarketing agent. The Remarketing Agent, any
successors to the Remarketing Agent and any co-remarketing agent shall be
members of the National Association of Securities Dealers, Inc. having a
capitalization acceptable to the Representative and the Note Insurer and
authorized by laws to perform all the duties imposed upon them hereunder, under
the Sale and Servicing Agreement and under the Interest Rate Services Agreement.
The Remarketing Agent may at any time resign and be discharged of the duties and
obligations created by the Sale and Servicing Agreement and the Interest Rate
Services Agreement by giving at least sixty (60) days' written notice to the
Representative, the Note Insurer and the Indenture Trustee. The Remarketing
Agent may be removed upon at least sixty (60) days' written notice to the
Remarketing Agent, at the direction of the Representative and with the prior
written consent of the Indenture Trustee and the Note Insurer, by an instrument
signed by the Representative and filed with the Remarketing Agent, the Indenture
Trustee and the Note Insurer. Notwithstanding the foregoing, no resignation or
removal of the Remarketing Agent shall be effective unless and until a successor
shall have been appointed; provided that such resignation by the Remarketing
Agent shall be effective upon such sixty (60) days' written notice whether or
not a successor has been appointed if and when the Remarketing Agent reasonably
determines that any one of the following shall obtain: (i) the Representative is
not diligently pursuing the appointment of a successor Remarketing Agent at the
level of compensation then generally paid in the marketplace for the services to
be performed by the successor Remarketing Agent, (ii) events have occurred which
materially adversely affect the Remarketing Agent's ability to fulfill its
duties as Remarketing Agent, including the elimination of the Remarketing
Agent's capacity to fulfill the duties of the Remarketing Agent or a
determination by counsel to the Remarketing Agent that continuation of
performance as such hereunder would be contrary to law or would expose the
Remarketing Agent to material risk of illegality, (iii) the Sale and Servicing
Agreement has been amended, modified or terminated in such manner as would
affect the Remarketing Agent or its duties without the consent of the
Remarketing Agent, or (iv) any condition to performance by the Remarketing Agent
hereunder shall not be satisfied. Any subsequent Remarketing Agent shall be
selected by the Representative, with the prior written consent of the Note
Insurer with notice to the Indenture Trustee, provided, however, that, with the
Representative's consent, the co-remarketing agent (or one of them, at the
Representative's discretion and the prior written consent of the Note Insurer)
shall become the Remarketing Agent automatically if the Remarketing Agent ceases
to act as Remarketing Agent for any reason.
In the event of the resignation or removal of the Remarketing Agent, the
Remarketing Agent shall pay over, assign and deliver the Auction Rate Notes held
by it in such capacity to its successor. In the event that the Representative
shall fail to appoint a Remarketing Agent hereunder, the Indenture Trustee may
do so at the direction and with the written consent of the Note Insurer.
SECTION 1.2. CHANGES IN AUCTION TERMS.
SECTION 1.2.1. CHANGES IN THE AUCTION DATE.
The Remarketing Agent, at the written direction of the Representative, may
specify an earlier Auction Date (but in no event more than five Business Days
earlier) than the Auction Date that would otherwise be determined in accordance
with the definition of "Auction Date" with respect to one or more specified
Auction Periods in order to conform with then current market practice with
respect to similar securities or to accommodate economic and financial factors
that may affect or be relevant to the day of the week constituting an Auction
Date and the interest rate borne on the Auction Rate Notes. The Representative
will not consent to such change in the Auction Date unless the Representative
will have received from the Remarketing Agent not less than three days nor more
than 20 days prior to the effective date of such change a written request for
consent together with a certificate demonstrating the need for change in
reliance on such factors. The Remarketing Agent will provide notice of its
determination to specify an earlier Auction Date for one or more Auction Periods
by means of a written notice delivered at least 10 days prior to the proposed
changed Auction Date to the Indenture Trustee, the Remarketing Agent, the Note
Insurer and the Representative.
Subject to the prior written consent of the Note Insurer, the changes in
Auction terms described above may be made with respect to the Auction Rate
Notes. In connection with any change in Auction Terms described above, the
Remarketing Agent is to provide such further notice to such parties as is
specified in the Interest Rate Services Agreement.
EXHIBIT A
Schedule of Loans
[Provided to Trustee]
[Form of Class A Note] EXHIBIT B
REGISTERED $
No. ___
SEE REVERSE FOR CERTAIN DEFINITIONS
CUSIP NO. ______________
[UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE ISSUER OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY NOTE ISSUED IS
REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO
SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY
TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON
IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN.]
THE PRINCIPAL OF THIS NOTE IS PAYABLE IN INSTALLMENTS AS SET FORTH HEREIN.
ACCORDINGLY, THE OUTSTANDING PRINCIPAL AMOUNT OF THIS NOTE AT ANY TIME MAY BE
LESS THAN THE AMOUNT SHOWN ON THE FACE HEREOF.
THE MONEY STORE TRUST 1998-C
CLASS A_ ASSET BACKED NOTES
The Money Store Trust 1998-C, a business trust organized and existing under
the laws of the State of Delaware (herein referred to as the "Issuer"), for
value received, hereby promises to pay to CEDE & CO., or registered assigns, the
principal sum of [_____________] DOLLARS payable on each Remittance Date in an
amount equal to the result obtained by multiplying (i) a fraction the numerator
of which is $[INSERT INITIAL PRINCIPAL AMOUNT OF NOTE] and the denominator of
which is $___________ by (ii) the aggregate amount, if any, payable from the
applicable Note Distribution Account in respect of principal on the Class A__
Notes pursuant to Section 3.1 of the Indenture; provided, however, that the
entire unpaid principal amount of this Note shall be due and payable on the
earlier of __________ (the "Class A_ Final Maturity Date") and the Redemption
Date, if any, pursuant to Section 10.1(a) (i) or (ii) or Section 10.1(b) of the
Indenture. The Issuer will pay interest on this Note at a variable interest rate
equal to Class A_ Remittance Rate as set forth in the Indenture (the "Remittance
Rate") on each Remittance Date commencing in October 1998 until the principal of
this Note is paid or made available for payment, on the principal amount of this
Note outstanding on the preceding Remittance Date (after giving effect to all
payments of principal made on the preceding Remittance Date). Interest will be
computed on the basis of a 360-day year consisting of the actual number of days
elapsed since interest was last paid or, in the case of the first Remittance
Date, from the Closing Date. Such principal of and interest on this Note shall
be paid in the manner specified on the reverse hereof.
Distributions of principal of this Note will made in the manner described
in the Sale and Servicing Agreement until the principal balance of this Note is
reduced to zero.
The principal of and interest on this Note are payable in such coin or
currency of the United States of America as at the time of payment is legal
tender for payment of public and private debts.
The Notes are entitled to the benefits of a note guaranty insurance policy
(the "Note Policy") issued by MBIA Insurance Corporation (the "Note Insurer"),
pursuant to which the Note Insurer has unconditionally guaranteed payments of
Insured Payments on each Remittance Date, all as more fully set forth in the
Indenture.
Reference is made to the further provisions of this Note set forth on the
reverse hereof, which shall have the same effect as though fully set forth on
the face of this Note.
Unless the certificate of authentication hereon has been executed by the
Trustee whose name appears below by manual signature, this Note shall not be
entitled to any benefit under the Indenture referred to on the reverse hereof,
or be valid or obligatory for any purpose.
IN WITNESS WHEREOF, the Issuer has caused this instrument to be signed,
manually or in facsimile, by its Authorized Officer as of the date set forth
below.
Date: September 29, 1998 THE MONEY STORE TRUST 1998-C,
By: CHASE MANHATTAN BANK DELAWARE,
not in its individual capacity but
solely as Owner Trustee under the
Trust Agreement,
By:_______________________
Authorized Signatory
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Class A__ Asset Backed Notes of The Money Store Trust
1998-C designated above and referred to in the within-mentioned Indenture.
Date: September 29, 0000 XXX XXXX XX XXX XXXX,
not in its individual capacity
but solely as Trustee,
By: _________________________
Authorized Signatory
[REVERSE OF NOTE]
This Note is one of a duly authorized issue of Notes of the Issuer,
designated as its Class A__ Notes (herein called the "Class A__ Notes"), all
issued under an Indenture dated as of August 31, 1998 (such indenture, as
supplemented or amended, is herein called the "Indenture"), between the Issuer
and The Bank of New York, as trustee (the "Trustee", which term includes any
successor Trustee under the Indenture), to which Indenture and all indentures
supplemental thereto reference is hereby made for a statement of the respective
rights and obligations thereunder of the Issuer, the Trustee and the Holders of
the Notes. The Notes are subject to all terms of the Indenture. All terms used
in this Note that are defined in the Indenture, as supplemented or amended,
shall have the meanings assigned to them in or pursuant to the Indenture, as so
supplemented or amended.
The Class AF Notes and Class AV Notes are and will be secured by the
collateral pledged as security therefor as provided in the Indenture.
Principal of the Class A__ Notes will be payable on each Remittance Date in
an amount described on the face hereof. "Remittance Date" means the fifteenth
day of each month, or, if any such date is not a Business Day, the next
succeeding Business Day, commencing October 1998.
As described above, the entire unpaid principal amount of this Note shall
be due and payable on the earlier of the Class A__ Final Maturity Date and the
Redemption Date, if any, pursuant to Section 10.1(a) (i) or (ii) or Section
10.1(b) of the Indenture. Notwithstanding the foregoing, the entire unpaid
principal amount of the Notes shall be due and payable (i) on the date on which
an Event of Default shall have occurred and be continuing so long as an Insurer
Default shall not have occurred and be continuing or (ii) if an Insurer Default
shall have occurred and be continuing, on the date on which an Event of Default
shall have occurred and be continuing and the Trustee or the Holders of the
Notes representing not less than a majority of the Outstanding Amount of the
Notes have declared the Notes to be immediately due and payable in the manner
provided in Section 5.2 of the Indenture.
Payments of interest on this Note due and payable on each Remittance Date,
together with the installment of principal, if any, to the extent not in full
payment of this Note, shall be made by check mailed to the Person whose name
appears as the Holder of this Note (or one or more Predecessor Notes) on the
Note Register as of the close of business on each Record Date, except that 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.), payments will be
made by wire transfer in immediately available funds to the account designated
by such nominee. Such checks shall be mailed to the Person entitled thereto at
the address of such Person as it appears on the Note Register as of the
applicable Record Date without requiring that this Note be submitted for
notation of payment. Any reduction in the principal amount of this Note (or any
one or more Predecessor Notes) effected by any payments made on any Remittance
Date shall be binding upon all future Holders of this Note and of any Note
issued upon the registration of transfer hereof or in exchange hereof or in lieu
hereof, whether or not noted hereon. If funds are expected to be available, as
provided in the Indenture, for payment in full of the then remaining unpaid
principal amount of this Note on a Remittance Date, then the Trustee, in the
name of and on behalf of the Issuer, will notify the Person who was the Holder
hereof as of the Record Date preceding such Remittance Date by notice mailed
prior to such Remittance Date and the amount then due and payable shall be
payable only upon presentation and surrender of this Note at the Trustee's
principal Corporate Trust Office or at the office of the Trustee's agent
appointed for such purposes located in the City of New York.
The Issuer shall pay interest on overdue installments of interest at the
Class A__ Remittance Rate to the extent lawful.
As provided in the Indenture, the Notes may be redeemed in whole, but not
in part, at the option of the Representative (with the consent of the Note
Insurer, under certain circumstances), on any Remittance Date on or after the
date on which the Pool Balance is less than five percent of the Original Pool
Principal Balances.
As provided in the Indenture and subject to certain limitations set forth
therein, the transfer of this Note may be registered on the Note Register upon
surrender of this Note for registration of transfer at the office or agency
designated by the Issuer pursuant to the Indenture, (i) duly endorsed by, or
accompanied by a written instrument of transfer in form satisfactory to the
Trustee duly executed by, the Holder hereof or his 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 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, and (ii) accompanied by such other documents
as the Trustee may require, and thereupon one or more new Notes of authorized
denominations and in the same aggregate principal amount will be issued to the
designated transferee or transferees. No service charge will be charged for any
registration of transfer or exchange of this Note, but the transferor may be
required to pay a sum sufficient to cover any tax or other governmental charge
that may be imposed in connection with any such registration of transfer or
exchange.
Each Noteholder or Note Owner, by acceptance of a Note or, in the case of a
Note Owner, a beneficial interest in a Note covenants and agrees that no
recourse may be taken, directly or indirectly, with respect to the obligations
of the Issuer, the Owner Trustee or the Trustee on the Notes or under the
Indenture or any certificate or other writing delivered in connection therewith,
against (i) the Representative, the Servicer, the holder of the Special
Interest, the Trustee or the Owner Trustee in its individual capacity, (ii) any
owner of a beneficial interest in the Issuer or (iii) any partner, owner,
beneficiary, agent, officer, director or employee of the Representative, the
Servicer, the holder of the Special Interest, the Trustee or the Owner Trustee
in its individual capacity, any holder of a beneficial interest in the Issuer,
the Representative, the Servicer, the holder of the Special Interest, the Owner
Trustee or the Trustee or of any successor or assign of the Representative, the
Servicer, the holder of the Special Interest, the Trustee or the Owner Trustee
in its individual capacity, except as any such Person may have expressly agreed
(it being understood that the 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.
Each Noteholder or Note Owner, by acceptance of a Note or, in the case of a
Note Owner, a beneficial interest in a Note covenants and agrees that by
accepting the benefits of the Indenture that such Noteholder will not at any
time institute against the Representative, the holder of the Special Interest or
the Issuer, or join in any institution against the Representative, the holder of
the Special Interest 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, the Indenture or the Basic Documents.
Prior to the due presentment for registration of transfer of this Note, the
Issuer, the Trustee, the Note Insurer and any agent of the Issuer, the Trustee
or the Note Insurer may treat the Person in whose name this Note (as of the day
of determination or as of such other date as may be specified in the Indenture)
is registered as the owner hereof for all purposes, whether or not this Note be
overdue, and neither the Issuer, the Trustee nor any such agent shall be
affected by notice to the contrary.
The Indenture permits, with certain exceptions as therein provided, the
amendment thereof and the modification of the rights and obligations of the
Issuer and the rights of the Holders of the Notes under the Indenture at any
time by the Issuer with the consent of the Note Insurer and the Holders of Notes
representing a majority of the Outstanding Amount of all Notes at the time
Outstanding. The Indenture also contains provisions permitting the Holders of
Notes representing specified percentages of the Outstanding Amount of the Notes,
on behalf of the Holders of all the Notes, to waive compliance by the Issuer
with certain provisions of the Indenture and certain past defaults under the
Indenture and their consequences. Any such consent or waiver by the Holder of
this Note (or any one of more Predecessor Notes) shall be conclusive and binding
upon such Holder and upon all future Holders of this Note and of any Note issued
upon the registration of transfer hereof or in exchange hereof or in lieu hereof
whether or not notation of such consent or waiver is made upon this Note. The
Indenture also permits the Trustee to amend or waive certain terms and
conditions set forth in the Indenture without the consent of Holders of the
Notes issued thereunder.
The term "Issuer" as used in this Note includes any successor to the Issuer
under the Indenture.
The Issuer is permitted by the Indenture, under certain circumstances, to
merge or consolidate, subject to the rights of the Trustee and the Holders of
Notes under the Indenture.
The Notes are issuable only in registered form in denominations as provided
in the Indenture, subject to certain limitations therein set forth.
This Note and the Indenture shall be construed in accordance with the laws
of the State of New York, without reference to its conflict of law provisions,
and the obligations, rights and remedies of the parties hereunder and thereunder
shall be determined in accordance with such laws.
No reference herein to the Indenture and no provision of this Note or of
the Indenture shall alter or impair the obligation of the Issuer, which is
absolute and unconditional, to pay the principal of and interest on this Note at
the times, place, and rate, and in the coin or currency herein prescribed.
Anything herein to the contrary notwithstanding, except as expressly
provided in the Indenture or the Basic Documents, neither Owner Trustee in its
individual capacity, The Bank of New York in its individual capacity, any owner
of a beneficial interest in the Issuer, nor any of their respective partners,
beneficiaries, agents, officers, directors, employees or successors or assigns
shall be personally liable for, nor shall recourse be had to any of them for,
the payment of principal of or interest on, or performance of, or omission to
perform, any of the covenants, obligations or indemnifications contained in this
Note or the Indenture, it being expressly understood that said covenants,
obligations and indemnifications of the Issuer have been made for the sole
purposes of binding the assets of the Issuer. The Holder of this Note by the
acceptance hereof agrees that except as expressly provided in the Indenture or
the Basic Documents, in the case of an Event of Default under the Indenture, the
Holder shall have no claim against any of the foregoing for any deficiency, loss
or claim therefrom; provided, however, that nothing contained herein shall be
taken to prevent recourse to, and enforcement against, the assets of the Issuer
for any and all liabilities, obligations and undertakings contained in the
Indenture or in this Note.
ASSIGNMENT
Social Security or taxpayer I.D. or other identifying number of assignee
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers
unto ________________________________
(name and address of assignee)
the within Note and all rights thereunder, and hereby irrevocably constitutes
and appoints _____________, attorney, to transfer said Note on the books kept
for registration thereof, with full power of substitution in the premises.
Dated: ___________ _______________________
Signature Guaranteed:
_________
NOTE: The signature to this assignment must correspond with the name of the
registered owner as it appears on the face of the within Note in every
particular, without alteration, enlargement or any change whatsoever.
EXHIBIT C
Custodial Agreement
See Exhibit I to the Sale and Servicing Agreement
