AMBAC ASSURANCE CORPORATION
and
GREENWICH CAPITAL MARKETS, INC.
INDEMNIFICATION AGREEMENT
GREENPOINT HOME EQUITY LOAN TRUST 2000-1
Dated as of June 15, 2000
TABLE OF CONTENTS
(This Table of Contents is for convenience of reference only and shall
not be deemed to be part of this Indemnification Agreement. All capitalized
terms used in this Indemnification Agreement and not otherwise defined shall
have the meanings set forth in Article I of this Indemnification Agreement.)
Page
----
Section 1. Defined Terms ....................................................1
Section 2. Other Definitional Provisions ....................................1
Section 3. Representations and Warranties of the Underwriter ................2
Section 4. Representations and Warranties of the Insurer ....................2
Section 5. Indemnification ..................................................3
Section 6. Amendments, Etc. .................................................5
Section 7. Notices ..........................................................5
Section 8. Severability .....................................................6
Section 9. Governing Law ....................................................6
Section 10. Counterparts .....................................................6
Section 11. Headings .........................................................6
(i)
INDEMNIFICATION AGREEMENT dated as of June 15, 2000 (the "Indemnification
Agreement"), by and between AMBAC ASSURANCE CORPORATION, as Insurer, and
GREENWICH CAPITAL MARKETS, INC. (the "Underwriter").
Section 1. Defined Terms. Unless the context clearly requires otherwise,
all capitalized terms used but not defined herein shall have the respective
meanings assigned to them in Annex A to the Pooling Agreement, the Insurance
Agreement or the Policy. For purposes of this Indemnification Agreement, the
following terms shall have the following meanings:
"Information Circular" means the Information Circular, dated June 15,
2000, in respect of the Certificates, and any amendment or supplement thereto,
and any other offering document in respect of the Certificates that makes
reference to the Policy.
"Insurance Agreement" means the Insurance and Indemnity Agreement (as may
be amended, modified or supplemented from time to time) dated as of June 29,
2000 by and among GreenPoint Mortgage Securities Inc., as Sponsor, GreenPoint
Mortgage Funding, Inc., as Servicer, the Insurer, the Trust, as Issuer, and the
Trustee.
"Insurer" means Ambac Assurance Corporation, or any successor thereto, as
issuer of the Policy.
"Insurer Information" has the meaning given such term in Section 4.
"Material Adverse Change" means, in respect of any Person, a material
adverse change in (i) the business, financial condition, results of operations
or properties of such Person on a consolidated basis with its subsidiaries or
(ii) the ability of such Person to perform its obligations under any of the
Company Documents.
"Offering Document" means the Prospectus Supplement, dated June 15, 2000,
in respect of the Notes, and any amendment or supplement thereto, and any other
offering document in respect of the Notes that makes reference to the Policy.
"Pooling Agreement" means the Pooling Agreement (as may be amended,
modified or supplemented from time to time as set forth therein) dated as of
June 1, 2000 by and between the Issuer and the Trustee, relating to the
GreenPoint Home Equity Loan Trust 2000-1, Home Equity Loan Asset-Backed
Securities, Series 2000-1.
"Securities Act" means the Securities Act of 1933, including, unless the
context otherwise requires, the rules and regulations thereunder, as amended
from time to time.
"Securities Exchange Act" means the Securities Exchange Act of 1934,
including, unless the context otherwise requires, the rules and regulations
thereunder, as amended from time to time.
"Underwriter" means Greenwich Capital Markets, Inc.
"Underwriter Information" has the meaning given such term in Section 3.
Section 2. Other Definitional Provisions. The words "hereof," "herein"
and "hereunder" and words of similar import when used in this Indemnification
Agreement shall refer to this Indemnification Agreement as a whole and not to
any particular provision of this Indemnification Agreement, and Section,
subsection, Schedule and Exhibit references are to this Indemnification
Agreement unless otherwise specified. The meanings given to terms defined herein
shall be equally applicable to both the singular and plural forms of such terms.
The words "include" and "including" shall be deemed to be followed by the phrase
"without limitation."
Section 3. Representations and Warranties of the Underwriter. The
Underwriter represents and warrants as of the Closing Date as follows:
(a) Compliance With Laws. The Underwriter will comply in all
material respects with all legal requirements in connection with offers
and sales of the Securities and will make such offers and sales in the
manner to be provided in the Offering Document and the Information
Circular.
(b) Offering Document and Information Circular. The
Underwriter will not use, or distribute to other broker-dealers for
use, any Offering Document in connection with the offer and sale of the
Notes or any Information Circular in connection with the offer and sale
of the Certificates unless such Offering Document or Information
Circular includes such information relating to the Insurer as has been
furnished by the Insurer for inclusion therein and has been approved by
the Insurer.
(c) Underwriter Information. All material provided by the
Underwriter for inclusion in the Offering Document and the Information
Circular (as revised from time to time), is true and correct in all
material respects, it being understood and agreed that the only such
information furnished by the Underwriter consists of the following
information (collectively, the "Underwriter Information"): the
information contained under the heading "Method of Distribution"
relating to the Underwriter in the Offering Document.
Section 4. Representations and Warranties of the Insurer. The Insurer
represents and warrants to the Underwriter as follows:
(a) Organization and Licensing. The Insurer is a duly
organized and licensed and validly existing Wisconsin stock insurance
company duly qualified to conduct an insurance business in the State of
New York.
(b) Corporate Power. The Insurer has the corporate power and
authority to issue the Policy and execute this Indemnification
Agreement and to perform all of its obligations hereunder and
thereunder.
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(c) Authorization; Approvals. Proceedings legally required for
the issuance of the Policy and the execution, delivery and performance
of this Indemnification Agreement have been taken and all material
licenses, orders, consents or other authorizations or approvals of any
governmental boards or bodies legally required for the enforceability
of the Policy have been obtained or are not material to the
enforceability of the Policy.
(d) Enforceability. The Policy, when issued, and this
Indemnification Agreement will each constitute a legal, valid and
binding obligation of the Insurer, enforceable in accordance with its
terms, subject to insolvency, reorganization, moratorium, receivership
and other similar laws affecting creditors' rights generally and by
general principles of equity and subject to principles of public policy
limiting the right to enforce the indemnification provisions contained
therein and herein, insofar as such provisions relate to
indemnification for liabilities arising under federal securities laws.
(e) Financial Information. The consolidated financial
statements of the Insurer and subsidiaries as of December 31, 1999 and
December 31, 1998, and for each of the years in the three-year period
ended December 31, 1999, prepared in accordance with generally accepted
accounting principles, included in the Annual Report on Form 10-K of
Ambac Financial Group, Inc. (which was filed with the Commission on
March 30, 2000; Commission File Number 1-10777) and the unaudited
consolidated financial statements of the Insurer and subsidiaries as of
March 31, 2000 and for the periods ending March 31, 2000 and March 31,
1999 included in the Quarterly Report on Form 10-Q of Ambac Financial
Group, Inc. for the period ended March 31, 2000 (which was filed with
the Commission on May 12, 2000), which are incorporated by reference in
the Offering Document and the Information Circular, fairly present in
all material respects the financial condition of the Insurer as of such
dates and for the periods covered by such statements in accordance with
generally accepted accounting principles consistently applied. Since
March 31, 2000, there has been no change in the financial condition of
the Insurer that would materially and adversely affect its ability to
perform its obligations under the Policy.
(f) Insurer Information. The information in the Offering
Document and the Information Circular as of the date hereof under the
caption "THE INSURER AND THE POLICY" (the "Insurer Information") is
true and correct in all material respects and does not contain any
untrue statement of a material fact.
(g) Rating. The Insurer is not aware of any facts that if
disclosed to Xxxxx'x or S&P would be reasonably expected to result in a
downgrade of the rating of the financial strength rating of the Insurer
by either of such Rating Agencies.
(h) No Litigation. There are no actions, suits, proceedings or
investigations pending or, to the best of the Insurer's knowledge,
threatened against it at law or in equity or before or by any court,
governmental agency, board or commission or any arbitrator which, if
decided adversely, would result in a Material Adverse Change or would
materially
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and adversely affect its ability to perform its obligations under the
Policy, this Indemnification Agreement or the Insurance and Indemnity
Agreement.
(i) Securities Act Registration. The Policy is exempt from
registration under the Securities Act.
Section 5. Indemnification.
(a) The Underwriter hereby agrees to pay, and to protect,
indemnify and hold harmless, the Insurer and its officers, directors,
shareholders, employees, agents and each Person, if any, who controls
the Insurer within the meaning of either Section 15 of the Securities
Act or Section 20 of the Securities Exchange Act from and against, any
and all claims, losses, liabilities (including penalties), actions,
suits, judgments, demands, damages, costs or expenses (including
reasonable fees and expenses of attorneys, consultants and auditors and
reasonable costs of investigations) of any nature arising out of or by
reason of any untrue statement of a material fact or an omission to
state a material fact necessary in order to make the statements therein
in light of the circumstances in which they were made not misleading,
contained in the Underwriter Information or a breach of any of the
representations and warranties of the Underwriter contained in Section
3.
(b) The Insurer agrees to pay, and to protect, indemnify and
hold harmless, the Underwriter and its respective officers, directors,
shareholders, employees, agents and each Person, if any, who controls
such Underwriter within the meaning of either Section 15 of the
Securities Act or Section 20 of the Securities Exchange Act from and
against, any and all claims, losses, liabilities (including penalties),
actions, suits, judgments, demands, damages, costs or expenses
(including reasonable fees and expenses of attorneys, consultants and
auditors and reasonable costs of investigations) of any nature arising
out of or by reason of any untrue statement of a material fact or an
omission to state a material fact necessary in order to make the
statements therein in light of the circumstances in which they were
made not misleading, contained in the Insurer Information or a breach
of any of the representations and warranties of the Insurer contained
in Section 4.
(c) If any action or proceeding (including any governmental
investigation) shall be brought or asserted against any Person
(individually, an "Indemnified Party" and, collectively, the
"Indemnified Parties") in respect of which the indemnity provided in
this Section 5(a) or (b) may be sought from the Underwriter, on the one
hand, or the Insurer, on the other (each, an "Indemnifying Party")
hereunder, each such Indemnified Party shall promptly notify the
Indemnifying Party in writing, and the Indemnifying Party shall assume
the defense thereof, including the employment of counsel satisfactory
to the Indemnified Party and the payment of all expenses. The
Indemnified Party shall have the right to employ separate counsel in
any such action and to participate in the defense thereof at the
expense of the Indemnified Party; provided, however, that the fees and
expenses of such separate counsel shall be at the expense of the
Indemnifying Party if (i) the Indemnifying Party has
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agreed to pay such fees and expenses, (ii) the Indemnifying Party shall
have failed to assume the defense of such action or proceeding and
employ counsel reasonably satisfactory to the Indemnified Party in any
such action or proceeding or (iii) the named parties to any such action
or proceeding (including any impleaded parties) include both the
Indemnified Party and the Indemnifying Party, and the Indemnified Party
shall have been advised by counsel that there may be one or more legal
defenses available to it which are different from or additional to
those available to the Indemnifying Party (in which case, if the
Indemnified Party notifies the Indemnifying Party in writing that it
elects to employ separate counsel at the expense of the Indemnifying
Party, the Indemnifying Party shall not have the right to assume the
defense of such action or proceeding on behalf of such Indemnified
Party, it being understood, however, that the Indemnifying Party shall
not, in connection with any one such action or proceeding or separate
but substantially similar or related actions or proceedings in the same
jurisdiction arising out of the same general allegations or
circumstances, be liable for the reasonable fees and expenses of more
than one separate firm of attorneys at any time for the Indemnified
Parties, which firm shall be designated in writing by the Indemnified
Party). The Indemnifying Party shall not be liable for any settlement
of any such action or proceeding effected without its written consent
to the extent that any such settlement shall be prejudicial to the
Indemnifying Party, but, if settled with its written consent, or if
there is a final judgment for the plaintiff in any such action or
proceeding with respect to which the Indemnifying Party shall have
received notice in accordance with this subsection (c), the
Indemnifying Party agrees to indemnify and hold the Indemnified Parties
harmless from and against any loss or liability by reason of such
settlement or judgment.
(d) To provide for just and equitable contribution if the
indemnification provided by the Indemnifying Party is determined to be
unavailable or insufficient to hold harmless any Indemnified Party
(other than due to application of this Section), each Indemnifying
Party shall contribute to the losses incurred by the Indemnified Party
on the basis of the relative fault of the Indemnifying Party, on the
one hand, and the Indemnified Party, on the other hand provided, that
the Underwriter shall not be liable for any amount in excess of (i) the
excess of the sales prices of the Securities to the public over the
prices paid therefor by the Underwriter over (ii) the aggregate amount
of any damages which the Underwriter has otherwise been required to pay
in respect of the same or any substantially similar claim.
The relative fault of each Indemnifying Party, on the
one hand, and each Indemnified Party, on the other, shall be determined
by reference to, among other things, whether the breach of, or alleged
breach of, any of its representations and warranties set forth was
within the control of, the Indemnifying Party or the Indemnified Party,
and the parties relative intent, knowledge, access to information and
opportunity to correct or prevent such breach.
No person guilty of fraudulent misrepresentation
(within the meaning of Section 11(f) of the Securities Act) shall be
entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation.
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Section 6. Amendments, Etc. This Indemnification Agreement may be
amended, modified, supplemented or terminated only by written instrument or
written instruments signed by the parties hereto.
Section 7. Notices. All demands, notices and other communications to be
given hereunder shall be in writing (except as otherwise specifically provided
herein) and shall be mailed by registered mail or personally delivered and
telecopied to the recipient as follows:
(a) To the Insurer:
Ambac Assurance Corporation
Xxx Xxxxx Xxxxxx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Structured Finance Department--MBS
Telecopy No.: 000-000-0000
Confirmation: 212-668-0340
(b) To the Underwriter:
Greenwich Capital Markets, Inc.
000 Xxxxxxxxx Xxxx
Xxxxxxxxx, Xxxxxxxxxxx 00000
Attention: Legal Department
Telecopy No.: 203-618-2132
Confirmation: 000-000-0000
A party may specify an additional or different address or addresses by
writing mailed or delivered to the other parties as aforesaid. All such notices
and other communications shall be effective upon receipt.
Section 8. Severability. In the event that any provision of this
Indemnification Agreement shall be held invalid or unenforceable by any court of
competent jurisdiction, the parties hereto agree that such holding shall not
invalidate or render unenforceable any other provision hereof. The parties
hereto further agree that the holding by any court of competent jurisdiction
that any remedy pursued by any party hereto is unavailable or unenforceable
shall not affect in any way the ability of such party to pursue any other remedy
available to it.
Section 9. Governing Law. This Indemnification Agreement shall be
governed by and construed in accordance with the laws of the State of New York.
Section 10. Counterparts. The Indemnification Agreement may be executed
in counterparts by the parties hereto, and all such counterparts shall
constitute one and the same instrument.
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Section 11. Headings. The headings of Sections and the Table of Contents
contained in this Indemnification Agreement are provided for convenience only.
They form no part of this Indemnification Agreement and shall not affect its
construction or interpretation.
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IN WITNESS WHEREOF, the parties hereto have executed this Indemnification
Agreement, all as of the day and year first above mentioned.
AMBAC ASSURANCE CORPORATION,
as Insurer
By: /s/ Xxxxxxx X. Xxxx
--------------------------
Name: Xxxxxxx X. Xxxx
Title: First Vice President
GREENWICH CAPITAL MARKETS, INC.,
as Underwriter
By: /s/ Xxxxx Xxxxx
--------------------------
Name: Xxxxx Xxxxx
Title: Vice President
