LIQUIDITY AGREEMENT
Dated as of May 21, 1998
among
CHARTER MAC OWNER TRUST I
as the Owner Trust
and
CHARTER MAC FLOATER CERTIFICATE TRUST I
as the Liquidity Borrower
and
FIRST TENNESSEE BANK NATIONAL ASSOCIATION
as the Tender Agent
and
THE FINANCIAL INSTITUTIONS
FROM TIME TO TIME PARTIES HERETO AS LIQUIDITY BANKS
as the Liquidity Banks
and
BAYERISCHE LANDESBANK GIROZENTRALE, NEW YORK BRANCH,
as the Liquidity Agent
and
MBIA INSURANCE CORPORATION,
as the Surety Provider
--------------------------------------------------------------------------------
TABLE OF CONTENTS
Page
ARTICLE I DEFINITIONS AND ACCOUNTING TERMS
SECTION 1.01 Definitions.....................................................................................1
ARTICLE II AMOUNTS AND TERMS OF THE ADVANCES
SECTION 2.01 The Advances....................................................................................9
SECTION 2.02 Use of Proceeds................................................................................11
SECTION 2.03 Making the Advances............................................................................11
SECTION 2.04 Increases and Decreases in the Liquidity Commitments...........................................12
SECTION 2.05 Payment of the Liquidity Obligations...........................................................15
SECTION 2.06 Interest on the Advances.......................................................................15
SECTION 2.07 Interest Rate Determination and Protection.....................................................17
SECTION 2.08 Voluntary Conversion and Continuation of Advances..............................................18
SECTION 2.09 Prepayments....................................................................................20
SECTION 2.10 Fees ..........................................................................................20
SECTION 2.11 Increased Costs; Increased Capital.............................................................20
SECTION 2.12 Payments and Computations......................................................................22
SECTION 2.13 Illegality.....................................................................................23
SECTION 2.14 Taxes .........................................................................................23
SECTION 2.15 Sharing of Payments. Etc.......................................................................25
SECTION 2.16 Evidence of Debt...............................................................................26
SECTION 2.17 Downgraded Bank Advances; Downgraded Bank Accounts.............................................26
ARTICLE III CONDITIONS PRECEDENT
SECTION 3.01 Conditions Precedent to the Effectiveness of this Agreement....................................27
SECTION 3.02 Conditions Precedent to Liquidity Borrowings, Conversions, and Continuations...................28
ARTICLE IV REPRESENTATIONS AND WARRANTIES
SECTION 4.01 Representations and Warranties of the Liquidity Borrower.......................................28
ARTICLE V COVENANTS OF THE LIQUIDITY BORROWER
SECTION 5.01 Affirmative Covenants..........................................................................30
SECTION 5.02 Negative Covenants.............................................................................32
SECTION 5.03 Amendment of Transaction Documents.............................................................32
ARTICLE VI EVENTS OF DEFAULT
SECTION 6.01 Events of Default..............................................................................33
SECTION 6.02 Remedies ......................................................................................34
SECTION 6.03 Notice of Certain Events.......................................................................34
-i-
ARTICLE VII THE LIQUIDITY AGENT
SECTION 7.01 Authorization and Action.......................................................................35
SECTION 7.02 Liquidity Agent's Reliance Etc.................................................................36
SECTION 7.03 Tender Agent; Liquidity Agent and Affiliates...................................................37
SECTION 7.04 Liquidity Bank Credit and Lending Decision.....................................................37
SECTION 7.05 Indemnification................................................................................38
SECTION 7.06 Successor Liquidity Agent......................................................................38
ARTICLE VIII MISCELLANEOUS
SECTION 8.01 Amendments, Etc................................................................................39
SECTION 8.02 Notices, Etc...................................................................................39
SECTION 8.03 No Waiver; Remedies............................................................................40
SECTION 8.04 Costs, Expenses, and Indemnification...........................................................40
SECTION 8.05 Binding Effect; Termination....................................................................41
SECTION 8.06 Assignments and Participation..................................................................41
SECTION 8.07 No Proceedings.................................................................................45
SECTION 8.08 No Recourse....................................................................................45
SECTION 8.09 Execution and Performance of Liquidity Pledge and Security Agreement and Insurance
Agreement......................................................................................46
SECTION 8.10 Termination and Recommitment...................................................................46
SECTION 8.11 Confidentiality................................................................................47
SECTION 8.12 GOVERNING LAW..................................................................................47
-ii-
SECTION 8.13 CONSENT TO JURISDICTION; WAIVER OF JURY TRIAL..................................................47
SECTION 8.14 Counterparts...................................................................................48
SECTION 8.15 Captions ......................................................................................48
SECTION 8.16 Severability...................................................................................48
SECTION 8.17 Notice of Limitation of Liability..............................................................48
SCHEDULES
Schedule I Commitments and List of Applicable Lending Offices
Schedule II Conditions Precedent Documents
Schedule III Notice Addresses
EXHIBITS
Exhibit A Form of Assignment and Acceptance
Exhibit B Form of Joinder Agreement
Exhibit C Form of Notice of Liquidity Borrowing
Exhibit D Form of Liquidity Commitment Increase
Exhibit E Form of Notice of Conversion/Continuation
Exhibit F Form of Liquidity Note
Exhibit G Form of Notice of Assignment Pursuant to Section 8.06
Exhibit H Forms of Opinion of Counsel to Liquidity Banks
Exhibit I Form of Notice of Recommitment
LIQUIDITY AGREEMENT (the "Agreement"), dated as of May 21,
1998, by and among CHARTER MAC OWNER TRUST I, a Delaware business trust (the
"Owner Trust"), CHARTER MAC FLOATER CERTIFICATE TRUST I, a Delaware business
trust (the "Liquidity Borrower"), FIRST TENNESSEE BANK NATIONAL ASSOCIATION, as
Tender Agent and Certificate Trust Agent (the "Tender Agent" and the
"Certificate Trust Agent"), THE FINANCIAL INSTITUTIONS parties hereto from time
to time as lenders (each, a "Liquidity Bank" and collectively, the "Liquidity
Banks"), BAYERISCHE LANDESBANK GIROZENTRALE, NEW YORK BRANCH, as agent for the
Liquidity Banks hereunder (in such capacity, the "Liquidity Agent") and MBIA
INSURANCE CORPORATION (the "Surety Provider").
IT IS AGREED as follows:
ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
SECTION I.1 Definitions.
(a) For all purposes of this Agreement, except as otherwise
expressly provided herein or unless the context otherwise requires, capitalized
terms not otherwise defined herein shall have the meanings given to such terms
in Appendix A hereto which is incorporated by reference herein. All other
capitalized terms used herein shall have the meanings specified herein.
"Advance" means an advance by a Liquidity Bank to the
Liquidity Borrower as part of a Liquidity Borrowing consisting of (a) a Funding
Advance consisting of either (i) a single Base Rate Advance or simultaneous Base
Rate Advances or (ii) a single Eurodollar Rate Advance or simultaneous
Eurodollar Rate Advances, in each case subject to Conversion or Continuation
pursuant to Section 2.08, or (b) a Downgraded Bank Advance, in each case
pursuant to Section 2.03.
"Agreement" has the meaning given to such term in the Preamble
hereto, as the same may be amended, restated, modified or supplemented from time
to time pursuant to Section 8.01.
"Applicable Lending Office" means, with respect to each
Liquidity Bank, the office of such Liquidity Bank specified as its lending
office for the relevant Type of Advances opposite its name on Schedule I hereto
or in the Assignment and Acceptance or Joinder Agreement pursuant to which it
became a Liquidity Bank, or such other office of such Liquidity Bank as such
Liquidity Bank may from time to time specify by notice given to the Liquidity
Borrower and the Liquidity Agent.
"Assignment and Acceptance" means an assignment and acceptance
entered into by a Liquidity Bank and an Eligible Assignee, and accepted by the
Liquidity Agent, in substantially the form of Exhibit A hereto.
"Available Funds" has the meaning given to such term in
Section 8.08.
"Available Liquidity Amount" has the meaning specified in
Section 2.01.
"Base Rate" means a fluctuating interest rate per annum equal
to the higher of (i) the rate of interest published in the New York edition of
The Wall Street Journal as the prime rate, or, in the event that no such rate is
published, the rate of interest announced by the Liquidity Agent in New York,
New York, from time to time as its base rate, whether or not such rate is the
lowest rate offered by such institution to its corporate borrowers and (ii) 1/2
of one percent per annum above the Federal Funds Rate.
"Base Rate Advance" means an Advance which bears interest at a
rate per annum determined on the basis of the Base Rate, as provided in Section
2.06(a).
"Business Day" means any day other than a Saturday, Sunday or
public holiday or the equivalent for banks in New York City and on which the New
York Stock Exchange is open for business, provided that, when used in connection
with any Eurodollar Rate Advance or other matters concerning the Eurodollar
Rate, the term "Business Day" means any such day on which dealings are carried
on in the London interbank market and on which banks are open for business in
London, England.
"Certificate Surety Bond" means Surety Bond No. 25961 issued
by the Surety Provider in favor of the Owner Trust which may be drawn by the
Administrative Agent to make payments owing on the Senior Certificates, as
amended, modified, supplemented, restated or replaced from time to time.
"Continue," "Continuation," and "Continued" each refers to a
continuation of Advances for additional Liquidity Interest Periods pursuant to
Section 2.08.
"Convert," "Conversion," and "Converted" each refers to a
conversion of Advances of one Type into Advances of another Type pursuant to
Section 2.08.
"Defaulting Liquidity Bank" has the meaning given to such term
in Section 2.03(c).
"Dollars" and the sign "$" each means lawful money of the
United States of America.
"Downgraded Bank Account" has the meaning given to such term
in Section 2.17(a).
"Downgraded Bank Advance" means an advance by a Liquidity Bank
which is remitted to a
Downgraded Bank Account pursuant to Section 2.17.
"Downgrade Event" means, with respect to any Liquidity Bank,
when such Liquidity Bank ceases to have a short-term unsecured indebtedness
rating of at least A-1 by S&P and P-1 by Moody's.
"Effective Date" means the date on which the conditions
specified in Section 3.01 shall have been satisfied.
"Eligible Assignee" means a commercial bank with a short-term
unsecured indebtedness rating of at least A-1 by S&P and P-1 by Moody's, and
which is acceptable to the Liquidity Agent, the Liquidity Borrower and the
Surety Provider, which acceptance neither the Liquidity Agent, Liquidity
Borrower nor the Surety Provider shall unreasonably withhold.
"Eligible Depository Institution" means a depository
institution, the short term unsecured senior indebtedness of which is rated at
least A-1 by S&P and P-1 by Moody's, and which is acceptable to the Liquidity
Borrower and the Surety Provider, which acceptance neither the Liquidity
Borrower nor the Surety Provider shall unreasonably withhold.
"ERISA" means the U.S. Employee Retirement Income Security Act
of 1974, as amended from time to time, and the regulations promulgated and
rulings issued thereunder.
"ERISA Affiliate" means any Person who for purposes of Title
IV of ERISA is a member of the Liquidity Borrower's controlled group, or under
common control with the Liquidity Borrower, within the meaning of Section 414 of
the IRC, and the regulations promulgated and rulings issued thereunder.
"Eurocurrency Liabilities" has the meaning assigned to that
term in Regulation D of the Board of Governors of the Federal Reserve System, as
in effect from time to time. For purposes of this Definition, Eurodollar Rate
Advances shall be deemed to be "Eurocurrency Liabilities" as defined in
Regulation D without benefit or credit for any prorations, exemptions or offsets
under Regulation D.
"Eurodollar Rate" means for any Liquidity Interest Period with
respect to a Eurodollar Rate Advance, an interest rate per annum determined by
the Liquidity Agent rounded upward, if necessary, to the next highest
one-sixteenth (1/16th) of one percent, to be equal to the quotient of (i) the
rate at which the London Branch of the Liquidity Agent would offer deposits in
United States dollars to major banks in the London interbank market for a period
equal to such Liquidity Interest Period and in a principal amount comparable to
the relevant amount to be financed hereunder at or about 11:00 a.m. London time
on the second Business Day before (and for value on) the first day of such
Liquidity Interest Period, divided by (ii) a number equal to 1.00 minus the
Eurodollar Reserve Percentage (expressed as a decimal) applicable to that
Liquidity Interest Period.
"Eurodollar Rate Advance" means an Advance which bears
interest at a rate per
-6-
annum determined on the basis of the Eurodollar Rate, as provided in Section
2.06(a).
"Eurodollar Reserve Percentage" means, for any Liquidity
Interest Period for any Eurodollar Rate Advance, the reserve percentage
applicable during such Liquidity Interest Period (or, if more than one such
percentage shall be so applicable, the daily average of such percentages for
those days in such Liquidity Interest Period during which any such percentage
shall be so applicable) equal to the maximum aggregate reserve requirements
(including, without limitation, any emergency, supplemental or other marginal
reserve requirement) specified under regulations issued by the Board of
Governors of the Federal Reserve System (or any successor) and then applicable
to liabilities or assets consisting of or including Eurocurrency Liabilities
having a term equal to such Liquidity Interest Period.
"Federal Funds Rate" means, for any day, the fluctuating
interest rate per annum at which the Liquidity Agent, as a branch of a foreign
bank, in its sole discretion, can acquire federal funds in the New York City
interbank federal funds market or other funding sources available to the
Liquidity Agent, through brokers of recognized standing, for a period and in an
amount comparable to the period and amount requested by the Liquidity Borrower.
"Funding Advance" means an Advance made under this Agreement
that is other than a Downgraded Bank Advance and that is made to purchase Low
Floater Certificates that were (i) tendered but not remarketed, or for which the
remarketing proceeds were insufficient to pay the purchase price thereof, or
(ii) subject to mandatory purchase pursuant to Section 6.13 of the Certificate
Issuer Trust Agreement, for which purchase Section 6.13 directs the Tender Agent
to draw funds under the Liquidity Facility.
"GAAP" means generally accepted accounting principles.
"Indemnified Party" has the meaning given to such term in
Section 8.04(a).
"Investment Proceeds" has the meaning given to such term in
Section 2.06(b).
"IRC" means the U.S. Internal Revenue Code of 1986, as amended
from time to time, and the regulations promulgated and rulings issued
thereunder.
"IRS" means the U.S. Internal Revenue Service and any
successor agency.
"Joinder Agreement" means a Joinder Agreement executed by the
Liquidity Borrower, an Eligible Assignee, and the Surety Provider in
substantially the form of Exhibit B hereto.
"Liquidity Agent" has the meaning given to such term in the
Preamble hereto.
"Liquidity Banks" has the meaning given to such term in the
Preamble hereto.
"Liquidity Borrower" has the meaning given to such term in the
Preamble hereto.
-7-
"Liquidity Borrowing" means a borrowing consisting either of
(i) a single Advance or (ii) a group of simultaneous Advances of the same Type,
in each case made by one or more of the Liquidity Banks (or, in the case of a
Downgraded Bank Advance, by the applicable Liquidity Bank subject to a
Downgraded Event) pursuant to the same Notice of Liquidity Borrowing described
in Section 2.03, subject to Conversion or Continuation pursuant to Section 2.08.
"Liquidity Commitment" means, at any time with respect to a
Liquidity Bank, the principal amount set forth beside such Liquidity Bank's name
under the heading "Liquidity Commitment" on Schedule I hereto or on the
signature page of the Assignment and Acceptance or Joinder Agreement pursuant to
which such Liquidity Bank became a Liquidity Bank hereunder in accordance with
the provisions of Section 8.06, as such Liquidity Commitment may be increased or
decreased from time to time in accordance with the provisions of Sections 2.01,
2.04, or 8.06, and "Liquidity Commitments" means, collectively, the aggregate
amount of the Liquidity Commitments of all of the Liquidity Banks.
"Liquidity Commitment Fee" means the fee to be paid by the
Liquidity Borrower to the Liquidity Agent, for the account of each Liquidity
Bank, which fee shall be equal to a rate per annum of 0.175% of each Liquidity
Bank's Unused Liquidity Commitment.
"Liquidity Commitment Termination Date" means the date ending
on the earlier to occur of (a) the close of business of the Liquidity Borrower
on the Scheduled Liquidity Commitment Termination Date, and (b) the close of
business of the Liquidity Borrower on the date of the termination in whole of
the Liquidity Commitments pursuant to Section 2.04(a), 6.02(a).
"Liquidity Event of Default" has the meaning given to such
term in Section 6.01.
"Liquidity Interest Period" means, for each Advance, the
period commencing on the date such Advance is made, Continued, or Converted, and
ending on the last day of the period selected by the Liquidity Borrower pursuant
to the terms set forth below. The duration of each Liquidity Interest Period
shall be (a) in the case of a Funding Advance which constitutes a Base Rate
Advance, any number of days not to exceed thirty-one and (b) in the case of a
Funding Advance which constitutes a Eurodollar Rate Advance, one, two, three,
six or nine months, in each case as the Liquidity Borrower may select by
delivery of a Notice of Liquidity Borrowing or Notice of
Conversion/Continuation, as the case may be, to the Liquidity Agent; provided,
however, that:
(i) whenever the last day of any Liquidity Interest Period
would otherwise occur on a day other than a Business Day, the last day of such
Liquidity Interest Period shall be extended to occur on the next succeeding
Business Day; provided, however, that in the case of a Liquidity Interest Period
for a Eurodollar Rate Advance which otherwise would occur in the next succeeding
calendar month, the last day of such Liquidity Interest Period shall be deemed
to occur on the immediately preceding Business Day;
-8-
(ii) whenever a Liquidity Interest Period for any Funding
Advance which constitutes a Eurodollar Rate Advance commences on the last
Business Day in a month or on a day for which there is no numerically
corresponding day in the month in which such Liquidity Interest Period ends, the
last day of such Liquidity Interest Period shall occur on the last Business Day
of the month in which such Liquidity Interest Period ends; and
(iii) no Liquidity Interest Period may end later than the
Scheduled Liquidity Maturity Date.
The Liquidity Agent shall promptly advise each Liquidity Bank
of the Liquidity Interest Period determined as provided above for the Advances
constituting each Liquidity Borrowing.
"Liquidity Note" has the meaning given to such term in Section
2.16.
"Liquidity Obligations" means all obligations of the Liquidity
Borrower to the Liquidity Banks and the Liquidity Agent under this Agreement,
the Liquidity Notes and the Liquidity Pledge and Security Agreement (however
created, arising or evidenced, whether direct or indirect, absolute or
contingent, or due or to become due) including, without limitation, (a) all
obligations to make payments to the Liquidity Banks of, and in respect of the
principal amount of, and interest on any Advance and (b) all obligations of the
Liquidity Borrower to the Liquidity Banks and/or the Liquidity Agent in respect
of fees, costs, expenses, and indemnities.
"Liquidity Surety Bond" means Surety Bond No. 25960 issued by
the Surety Provider in favor of the Liquidity Agent for the benefit of the
Liquidity Banks, as amended, modified, supplemented, restated or replaced from
time to time.
"Majority Liquidity Banks" means, at any time, Liquidity Banks
that are owed more than 66_% of the aggregate unpaid principal amount of the
Advances then outstanding or, if no Advances are then outstanding, Liquidity
Banks having more than 66_% of the aggregate Liquidity Commitments. For purposes
of this definition, "Advance" shall not include any Downgraded Bank Advance
(other than to the extent such Downgraded Bank Advance has been converted into a
Funding Advance).
"Notice of Conversion/Continuation" has the meaning given to
such term in Section 2.08(b).
"Notice of Liquidity Borrowing" has the meaning given to such
term in Section 2.03(a).
"Notice of Liquidity Commitment Increase" has the meaning
given to such term in Section 2.04(b).
"Other Taxes" has the meaning given to such term in Section
2.14(b).
-9-
"Participant" has the meaning set forth in Section 8.06(e).
"Permitted Investments" means (i) non-callable direct
obligations of, or non-callable obligations fully guaranteed by, the United
States of America, or by any agency or instrumentality of the United States of
America the obligations of which are backed by the full faith and credit of the
United States of America; (ii) an investment in a no-load money market fund
rated AAAm-G by S&P and Aaa by Moody's, the assets of which are invested solely
in obligations described in clauses (iii) through (v) of this definition; (iii)
commercial paper having an original maturity of less than 270 days and a rating
in the highest rating category of S&P and Moody's at the time of such
investment; (iv) certificates of deposit of, banker's acceptances issued by or
federal funds sold by any depository institution or trust company (including the
Tender Agent) incorporated under the laws of the United States of America or any
State thereof and subject to supervision and examination by federal and/or state
authorities, so long as at the time of such investment or contractual commitment
providing for such investment such depository institution or trust company has a
long-term unsecured debt rating in the highest rating category of S&P and
Moody's, and provided that each instrument has an original maturity of less than
365 days, and any other demand or time deposit or certificate of deposit which
is fully insured by the FDIC through the Bank Insurance Fund and rated at least
A-1 by S&P and P-1 by Moody's; (v) repurchase obligations with respect to (a)
any security described in clause (i) collateralized at 105% of the principal
amount of such repurchase obligations or (b) any other security issued or
guaranteed as to timely payment by an agency or instrumentality of the United
States of America, collateralized at 105% of the principal amount of such
repurchase obligations in either case entered into with a depository institution
or trust company (including the Tender Agent), acting as principal, whose
obligations having the same maturity as that of the repurchase agreement would
be Permitted Investments under clause (iii) above (provided that the
counterparty is rated at least "A-1" by S&P and "P-1" by Moody's); or (vi) money
market funds having ratings in the highest available rating category of S&P and
Moody's.
"Person" means any legal person, including any individual,
corporation, partnership, joint venture, association, joint stock company,
trust, unincorporated organization or government or any agency or political
subdivision thereof.
"Plan" means any employee benefit plan as defined in Section
3(3) of ERISA in respect of which the Liquidity Borrower or any ERISA Affiliate
is, or within the immediately preceding six years was, an "employer" as defined
in Section 3(5) of ERISA, and in respect of which the Liquidity Borrower or an
ERISA Affiliate could have liability under Title IV of ERISA.
"Pro Rata Share" means, at any time, with respect to a
Liquidity Bank's obligations under this Agreement, for any Liquidity Bank, a
fraction (a) the numerator of which is such Liquidity Bank's Liquidity
Commitment at such time and (b) the denominator of which is the aggregate
Liquidity Commitments at such time.
"Register" has the meaning given to such term in Section
8.06(c).
-10-
"Scheduled Liquidity Commitment Termination Date" means the
later of (i) 364 days from the Effective Date hereof or (ii) such other date to
which the Liquidity Commitments are extended pursuant to Section 8.10.
"Scheduled Liquidity Maturity Date" means the Business Day
next succeeding the "Principal Draw Date" under and as defined in the Liquidity
Surety Bond.
"Taxes" has the meaning given to such term in Section 2.14(a).
"Type" means, with reference to an Advance, a Base Rate
Advance or a Eurodollar Rate Advance.
"United States" and "U.S." each means the United States of
America.
"Unused Liquidity Commitment" means the average daily amount
of the unused portion of each Liquidity Bank's Liquidity Commitment (it being
understood that Downgraded Bank Advances do not constitute usage of the
applicable Liquidity Bank's Liquidity Commitment) from the Effective Date
thereof in the case of each Liquidity Bank that is a signatory hereto and from
the effective date specified in the Assignment and Acceptance or in the Joinder
Agreement pursuant to which it became a Liquidity Bank in the case of each other
Liquidity Bank, until the Liquidity Commitment Termination Date.
(b) All defined terms in this Agreement shall have the
defined meanings when used in any certificate or other document made or
delivered pursuant hereto unless otherwise defined therein.
(c) As used in this Agreement and in any certificate or
other document made or delivered pursuant hereto or thereto, accounting terms
not defined in this Agreement or in any such certificate or other document, and
accounting terms partly defined in this Agreement or in any such certificate or
other document to the extent not defined, shall have the respective meanings
given to them under generally accepted accounting principles. To the extent that
the definitions of accounting terms in this Agreement or in any such certificate
or other document are inconsistent with the meanings of such terms under
generally accepted accounting principles, the definitions contained in this
Agreement or in any such certificate or document shall control.
(d) The words "hereof," "herein," "hereunder" and words of
similar import when used in this Agreement shall refer to this Agreement as a
whole and not to any particular provision of this Agreement; Section and Exhibit
references contained in this Agreement are references to Sections and Exhibits
in or to this Agreement unless otherwise specified, and the term "including"
shall mean "including without limitation."
(e) The definitions contained in this Agreement are
applicable to the singular as well as the plural forms of such terms and to the
masculine as well as to the feminine and neuter genders of such terms.
-11-
(f) Any agreement, instrument or statute defined or referred
to herein or in any instrument or certificate delivered in connection herewith
means such agreement, instrument or statute as from time to time amended,
modified, consolidated, continued, extended or supplemented and includes (in the
case of agreements or instruments) references to all attachments thereto and
instruments incorporated therein; references to a Person are also to its
permitted successors and assigns.
(g) In this Agreement in the computation of periods of time
from a specified date to a later specified date, the word "from" means "from and
including" and the words "to" and "until" each means "to but excluding." Periods
of days referred to in this Agreement shall be counted in calendar days, unless
Business Days are expressly prescribed, and references in this Agreement to
months and years shall be to calendar months and calendar years, unless
otherwise specified.
ARTICLE II
AMOUNTS AND TERMS OF THE ADVANCES
SECTION II.1 The Advances. Each Liquidity Bank severally agrees, on the
terms and conditions hereinafter set forth, to make Advances to the Liquidity
Borrower from time to time on any Business Day during the period from the
Effective Date to the Liquidity Commitment Termination Date in an aggregate
amount not to exceed at any time outstanding such Liquidity Bank's Liquidity
Commitment; provided, that, Funding Advances shall be made only for the purpose
of paying the purchase price of Low Floater Certificates that have been (a)
tendered for purchase but not remarketed, or for which the remarketing proceeds
are insufficient to pay the purchase price thereof, or (b) subject to mandatory
purchase pursuant to Section 6.13 of the Certificate Issuer Trust Agreement, for
which purchase Section 6.13 directs the Tender Agent to draw funds under the
Liquidity Facility; provided further that in no event shall the principal amount
of any Funding Advances made on any Business Day exceed the following (the
"Available Liquidity Amount"):
(i) an amount equal to the lesser of
(A) the total amount of the Liquidity Commitments and
(B) an amount equal to the lesser of (x) and (y), where
(x) equals the sum of:
(1) the Outstanding Face Amount of Low Floater
Certificates (including Liquidity Provider
Certificates), plus
(2) all accrued and unpaid Low Floater Certificate
-12-
Distribution Payments accrued and unpaid since the
last Low Floater Certificate Distribution Payment
Date,
and (y) equals the Insured Amount as defined in the
Liquidity Surety Bond;
minus (ii) all amounts (if any) previously paid to the
beneficiary of the Liquidity Surety Bond pursuant to a Principal Notice for
Payment (as defined in the Liquidity Surety Bond);
minus (iii) all amounts (if any) previously paid to the
beneficiary of the Certificate Surety Bond pursuant to a Face Amount Notice for
Payment that have not yet been applied by the beneficiary to cause reduction
equal to the amount so drawn in the Outstanding Face Amount of the Senior
Certificate and in the Outstanding Face Amount of the Low Floater Certificates;
and
minus (iv) the aggregate outstanding principal balance of
Funding Advances.
Each Liquidity Borrowing shall consist of Advances of the same
Type made on the same day by the Liquidity Banks (or in the case of a Downgraded
Bank Advance, by the applicable Liquidity Bank subject to a Downgrade Event)
ratably according to their respective Pro Rata Shares, it being understood that
more than one Liquidity Borrowing may be made on the same day (provided,
however, that, solely under the circumstances described in the second sentence
of Section 2.03(d), a Liquidity Borrowing may consist of (x) a single Advance
made by a Liquidity Bank, or (y) multiple Advances of the same Type made on the
same day by one or more Liquidity Banks). Within the limits of each Liquidity
Bank's Liquidity Commitment, the Liquidity Borrower may borrow, repay pursuant
to Section 2.05, and reborrow under this Section 2.01. There shall be no
reborrowing, however, with respect to a payment that was previously made to the
beneficiary of either the Certificate Surety Bond pursuant to a Face Amount
Notice for Payment (as defined in the Certificate Surety Bond) or the Liquidity
Surety Bond pursuant to a Principal Notice for Payment (as defined in the
Liquidity Surety Bond). Prior to the Scheduled Liquidity Maturity Date, any
outstanding Advances may, at the option of the Liquidity Borrower, be Converted
or Continued pursuant to the terms of Section 2.08, subject to the terms of
Section 3.02. The Advances and all other Liquidity Obligations shall be repaid
or paid, as the case may be, solely out of the applicable funds described in
Section 2.05 without recourse to any other assets of the Liquidity Borrower.
SECTION II.2 Use of Proceeds. The Liquidity Borrower covenants and
agrees that (i) the proceeds of the Downgraded Bank Advances shall only be used
to fund the Downgraded Bank Accounts, and (ii) the proceeds of the Funding
Advances shall only be used to purchase Low Floater Certificates.
SECTION II.3 Making the Advances.
-13-
(a) Each Liquidity Borrowing, in the case of Funding Advances
which constitute Base Rate Advances and in the case of Downgraded Bank Advances,
shall be made on telephonic notice, given not later than 10:30 A.M. (New York
City time) on the date of the proposed Liquidity Borrowing (which date shall be
a Business Day), by the Tender Agent to the Liquidity Agent, which shall then
give to each applicable Liquidity Bank promptly (and in any event not later than
11:30 A.M. (New York City time) on such date) notice thereof by telephone or
facsimile. As soon as practicable following delivery of such telephonic notice,
the Tender Agent shall deliver to the Liquidity Agent a notice of a Liquidity
Borrowing (a "Notice of Liquidity Borrowing") by facsimile, in substantially the
form of Exhibit C hereto. A Borrowing consisting of Base Rate Advances may be in
any available amount.
(b) Each Liquidity Borrowing, in the case of Funding Advances
which constitute Eurodollar Rate Advances, shall be made on telephonic notice,
given not later than 10:30 A.M. (New York City time) on the third Business Day
prior to the requested date of a proposed Liquidity Borrowing, by the Tender
Agent to the Liquidity Agent, which shall then give to each applicable Liquidity
Bank prompt notice thereof by telephone or facsimile (in any event not later
than 2:00 P.M. (New York City time) on such date). As soon as practicable
following delivery of such telephonic notice, the Tender Agent shall deliver to
the Liquidity Agent a Notice of Liquidity Borrowing by facsimile. Except as
provided in subsection (e) below, a Borrowing consisting of Eurodollar Rate
Advances shall be in an aggregate amount of not less than $1,000,000.
(c) Each Notice of Liquidity Borrowing to be delivered by the
Tender Agent to the Liquidity Agent pursuant to this Section 2.03 shall specify
(i) the date of such proposed Liquidity Borrowing, (ii) the aggregate amount of
such proposed Liquidity Borrowing, (iii) the Liquidity Interest Periods (all of
which shall be of the same duration) for the Advances to be made as part of such
proposed Liquidity Borrowing and (iv) in the case of a proposed Downgraded Bank
Advance, the Liquidity Bank required to make such Advance. Any Notice of
Liquidity Borrowing (or telephonic notice of Liquidity Borrowing) given by the
Tender Agent pursuant to this Section 2.03 shall be irrevocable and binding on
the Liquidity Borrower. Each Liquidity Bank shall, before 12:00 P.M. (New York
City time) on the date of such Liquidity Borrowing, make available for the
account of its Applicable Lending Office to the Liquidity Agent at The Chase
Manhattan Bank, New York Fed ABA #000000000, Account of: Bayerische Landesbank,
New York Branch, Account #000-0-00000 Reference: CMAC Certificate Trust, in same
day funds, such Liquidity Bank's Pro Rata Share of such requested Liquidity
Borrowing. After the Liquidity Agent's receipt of such funds (or, at the
Liquidity Agent's option, such earlier time as permitted pursuant to Section
2.12(c)), and upon fulfillment of the applicable conditions set forth in Section
3.02 hereof, the Liquidity Agent will make such funds available no later than
1:00 P.M. (New York City time) to the Tender Agent for such Low Floater
Certificates or will direct the deposit of such funds into appropriate
Downgraded Bank Accounts, as designated by the Liquidity Borrower to the
Liquidity Agent in the Notice of Liquidity Borrowing.
(d) The failure of any Liquidity Bank to make the Advance to
be made by it as part of any Liquidity Borrowing (each such Liquidity Bank being
a "Defaulting Liquidity
-14-
Bank") shall not relieve any other Liquidity Bank of its obligation hereunder to
make its Advance on the date of such Liquidity Borrowing. In addition, subject
in all events to all of the other terms and conditions of this Agreement, the
Tender Agent shall request one or more additional Liquidity Borrowings, from one
or more Liquidity Banks which are not Defaulting Liquidity Banks, in an
aggregate amount sufficient (assuming the failure of each Defaulting Liquidity
Bank to participate in all such additional Liquidity Borrowings) to cover any
shortfall in requested Liquidity Borrowings resulting from the failure of one or
more Defaulting Liquidity Banks to make any requested Advances hereunder, and
each Liquidity Bank shall be obligated to participate in each such additional
Liquidity Borrowing so long as, after giving effect to each such requested
Advance, the aggregate outstanding principal balance of each Liquidity Bank's
Funding Advances does not exceed its Liquidity Commitment. The Tender Agent will
make a request, on behalf of the Liquidity Borrower, for additional Liquidity
Borrowings from Liquidity Banks that are not Defaulting Liquidity Banks by
giving notice to the Liquidity Agent by 1:00 P.M. (New York City time) of the
need for such additional Liquidity Borrowings.
(e) A Liquidity Borrowing consisting of Downgraded Bank
Advances shall be made in the amount of the then unused portion of the
applicable Liquidity Bank's Liquidity Commitment.
SECTION II.4 Increases and Decreases in the Liquidity Commitments.
(a) Decreases and Termination. The Liquidity Borrower shall
have the right, upon at least one Business Day's prior written notice to the
Liquidity Agent, to terminate in whole or reduce in part (ratably or
non-ratably, in the sole discretion of the Liquidity Borrower) the unused
portions of the respective Liquidity Commitments of the Liquidity Banks;
provided, however, that (i) each partial reduction shall be in the minimum
aggregate amount of $5,000,000 or an integral multiple of $1,000,000 in excess
of that amount, and (ii) the Liquidity Borrower shall in no event reduce the
Liquidity Commitments at any time below an amount equal to (A) the Outstanding
Face Amount of Low Floater Certificates plus (B) the maximum amount of Low
Floater Certificate Distribution Payments that may accrue from one Low Floater
Certificate Distribution Payment Date to the next Low Floater Certificate
Distribution Payment Date, which is a maximum of 35 days of accrued Low Floater
Certificate Distribution Payments at 12% per annum.
(b) Increase in Liquidity Commitment of Existing Liquidity.
Bank. The Liquidity Borrower shall have the right, at any time and from time to
time, with the written consent of the Surety Provider and the Liquidity Bank
whose Liquidity Commitment is to be increased hereby (which consent is in such
Liquidity Bank's sole and absolute discretion), to increase the Liquidity
Commitment of any Liquidity Bank. Each such increase shall be effected by
delivery to the Liquidity Agent (i) by facsimile of a notice of Liquidity
Commitment increase (a "Notice of Liquidity Commitment Increase") in
substantially the form of Exhibit D, executed by the Liquidity Borrower, the
Surety Provider and the Liquidity Bank whose Liquidity Commitment is being
increased thereby, stating, among other things, the amount to which such
Liquidity Bank's Commitment is being increased, the effective date thereof,
which effective date shall be at least one Business Day after the execution of
such notice, and stating that such
-15-
Liquidity Bank is authorized to endorse the increased amount of its Liquidity
Commitment on such Liquidity Bank's Liquidity Note and (ii) a replacement
Liquidity Surety Bond in an "Insured Amount" equal to the Liquidity Commitments
after giving effect to such increase plus "Yield" (each as defined in the
Liquidity Surety Bond) and otherwise substantially identical to the original
Liquidity Surety Bond. Upon receipt of an executed Notice of Liquidity
Commitment Increase pursuant to this Section 2.04(b), the Liquidity Agent shall
record the information contained therein in the Register and give prompt notice
thereof to the other Liquidity Banks.
(c) Increase in Liquidity Commitments by Addition of a New
Liquidity Bank.
(i) The Liquidity Borrower shall have the right, at any
time and from time to time, with the written consent of the Surety Provider and
the Liquidity Agent (which consent shall not be unreasonably withheld), to add
any Eligible Assignee as a Liquidity Bank hereunder; provided, that if such
addition of a Liquidity Bank shall cause the Liquidity Commitments to be
increased, then the Surety Provider shall be required to deliver a replacement
Liquidity Surety Bond to the Liquidity Agent in an "Insured Amount" equal to the
Liquidity Commitments after giving effect to such increase plus "Yield" and
otherwise substantially identical to the original Liquidity Surety Bond. Each
such addition shall be effected by delivery to the Liquidity Agent of a Joinder
Agreement executed by such new Liquidity Bank, the Liquidity Borrower and the
Surety Provider. The Liquidity Borrower, at its own expense, shall execute and
deliver to each new Liquidity Bank a Liquidity Note payable to the order of such
new Liquidity Bank, dated the effective date of the Joinder Agreement and
otherwise in substantially the form of Exhibit F hereto. Upon receipt of a
Joinder Agreement, if such Joinder Agreement has been fully executed, completed
and is substantially in the form of Exhibit B, the Liquidity Agent shall record
the information contained therein in the Register and give prompt notice thereof
to the other Liquidity Banks.
(ii) Notwithstanding the foregoing Section 2.04(c)(i)
and solely to the extent required by the Liquidity Borrower, the Liquidity
Agent, S&P or Xxxxx'x, no such Joinder Agreement shall be effective unless
counsel to the applicable new Liquidity Bank shall deliver an opinion in the
form of Exhibit H (or two or more opinions which collectively address the
matters set forth in such Exhibit H, and which, in any event, shall include an
opinion of New York counsel to such Liquidity Bank) to the Liquidity Borrower,
the Liquidity Agent, S&P and Xxxxx'x.
(iii) By executing and delivering a Joinder Agreement,
the new Liquidity Bank thereunder confirms to and agrees with each party hereto
as follows: (A) such new Liquidity Bank confirms that it has received a copy of
this Agreement, together with copies of such financial statements and other
documents and information as it has deemed appropriate to make its own credit
analysis and decision to enter into such Joinder Agreement; (B) such new
Liquidity Bank will, independently and without reliance upon the Liquidity Agent
or any other Liquidity Bank and based on such documents and information as it
shall deem appropriate at the time, continue to make its own credit decisions in
taking or not taking action under this Agreement and the other Transaction
Documents; (C) such new Liquidity Bank confirms that it
-16-
is an Eligible Assignee; (D) such new Liquidity Bank appoints and authorizes the
Liquidity Agent to take such action as agent on its behalf and to exercise such
powers under this Agreement or the other Transaction Documents, as the case may
be, as are delegated to the Liquidity Agent by the terms hereof and thereof,
together with such powers as are reasonably incidental thereto; (E) such new
Liquidity Bank agrees that it will perform in accordance with their terms all of
the obligations which by the terms of this Agreement or the other Transaction
Documents, as the case may be, are required to be performed by it as a Liquidity
Bank and (F) such new Liquidity Bank agrees that it will comply with the
provisions contained in Section 8.06 of this Agreement.
(d) Notice of Increases or Decreases in Liquidity Commitments
to the Liquidity Borrower.
Notice of increases or decreases in
Liquidity Commitments pursuant to paragraphs (a), (b) and (c) of this Section
2.04 shall be given by the Liquidity Agent to the Liquidity Borrower, the Tender
Agent, the Remarketing Agent and the Certificate Trust Agent at least thirty
days before the effective date of such increase or decrease in the Liquidity
Commitment of any Liquidity Bank or the joinder of any additional bank as a new
Liquidity Bank.
SECTION II.5 Payment of the Liquidity Obligations.
(a) The principal amount of each Advance shall be due and
payable on the Scheduled Liquidity Maturity Date. All interest, fees, and other
amounts owing hereunder shall be due and payable as specified elsewhere in this
Agreement. All outstanding Liquidity Obligations shall be due and payable on the
Scheduled Liquidity Maturity Date.
(b) Amounts due and payable hereunder are payable by the
Liquidity Borrower solely out of Available Funds.
(c) Any and all payments made by the Liquidity Borrower to the
Liquidity Agent hereunder with respect to the Liquidity Obligations on any date
and any and all proceeds of the Surety Bonds and amounts paid to the Liquidity
Collateral Agent pursuant to the terms of the Liquidity Pledge and Security
Agreement remitted to the Liquidity Agent by the Liquidity Collateral Agent or
directly by the Surety Provider (as the case may be) and any other Available
Funds paid to the Liquidity Agent shall be applied first, in payment pro rata of
the accrued but unpaid interest on any Advances then due and payable, second, in
payment pro rata of all other amounts then due and payable to the Liquidity
Banks and Liquidity Agent hereunder (other than the outstanding principal amount
of maturing Advances), and third, in payment pro rata of the outstanding
principal amount of all Advances.
(d) At any time that any amounts can be obtained from a
drawing under the Liquidity Surety Bond, the Liquidity Agent shall make a
drawing under the Liquidity Surety Bond in an amount equal to the full amount
available for drawing and then required to be paid under such Surety Bond.
Promptly after each such drawing, the Liquidity Agent shall
-17-
distribute those proceeds to the Liquidity Banks for application to the Advances
and other amounts then owing hereunder in the order prescribed in Section
2.05(c).
(e) If on any day the funds received by the Liquidity Agent,
as contemplated by this Section 2.05, for application to the Liquidity
Obligations that are due and payable on such day are insufficient, when applied
in accordance with the terms of this Agreement, to repay in full all such
Liquidity Obligations, such unpaid amounts shall remain due and payable, subject
to payment in accordance with the terms of this Section 2.05, and while so
outstanding shall bear interest at the rate applicable to Base Rate Advances,
which interest shall be due and payable as it accrues.
SECTION II.6 Interest on the Advances.
(a) The Liquidity Borrower shall pay to the Liquidity Agent
for the account of each Liquidity Bank interest on the unpaid principal amount
of each Funding Advance made by such Liquidity Bank from the date of such
Advance until such principal amount shall be paid in full, at the Liquidity
Facility Rate, which shall be equal to (i) or (ii) below, at the option of the
Liquidity Borrower, as determined in accordance with this Agreement (the
"Liquidity Facility Rate"):
(i) for Eurodollar Rate Advances, a rate per annum equal
at all times during each applicable Liquidity Interest Period for such Advance
to the Eurodollar Rate for such Liquidity Interest Period, plus
----------------------------------------------- -------------------------------------------- --------------------
To (but excluding) number
From the number of days after the date of any of days from date of Funding Margin (number of
Funding Advance Advance basis points)
----------------------------------------------- -------------------------------------------- --------------------
Date of any Funding Advance 90 days 100.0
----------------------------------------------- -------------------------------------------- --------------------
90 180 days 112.5
----------------------------------------------- -------------------------------------------- --------------------
180 270 days 125.0
----------------------------------------------- -------------------------------------------- --------------------
270 360 days 137.5
----------------------------------------------- -------------------------------------------- --------------------
360 450 days 150.0
----------------------------------------------- -------------------------------------------- --------------------
450 540 days 162.5
----------------------------------------------- -------------------------------------------- --------------------
540 630 days 175.0
----------------------------------------------- -------------------------------------------- --------------------
630 720 days 187.5
----------------------------------------------- -------------------------------------------- --------------------
720 and thereafter 200
----------------------------------------------- -------------------------------------------- --------------------
-18-
or
(ii) for Base Rate Advances, a rate per annum equal at
all times during each applicable Liquidity Interest Period for such Advance to
the Base Rate in effect from time to time during such Liquidity Interest Period.
(b) The Liquidity Agent shall remit, for the account of each
relevant Liquidity Bank subject to a Downgrade Event, any interest earnings on
the unpaid principal amount of each Downgraded Bank Advance from time to time
maintained in a Downgraded Bank Account in an amount equal to the amount of all
realized interest from its investment of such Liquidity Bank's Downgraded Bank
Advances pursuant to Section 2.17(c) (net of investment expenses and fees and of
losses on such investments, if any) (such net realized interest and other income
being hereinafter referred to collectively as the "Investment Proceeds").
(c) Interest on each Advance shall be payable (i) for each
Base Rate Advance, on the earliest of (x) the day on which such Base Rate
Advance is converted to a Eurodollar Rate Advance pursuant to Section 2.08, and
(y) the last day of each quarter, (ii) for each Eurodollar Rate Advance, on the
last day of each Liquidity Interest Period, and, if such Liquidity Interest
Period is longer than three months, on each three month anniversary of the first
day of such Liquidity Interest Period that occurs prior to the last day of such
Liquidity Interest Period, (iii) with respect to each Base Rate Advance and
Eurodollar Rate Advance, on each date upon which a prepayment of such Advance is
made (as to the principal portion being repaid), and (iv) with respect to each
Downgraded Bank Advance, pursuant to the terms of Section 2.17(c).
SECTION II.7 Interest Rate Determination and Protection.
(a) The Liquidity Agent shall give prompt notice to the
Liquidity Borrower and the Liquidity Banks of the applicable interest rate
determined by the Liquidity Agent for purposes of Section 2.06(a).
(b) If, with respect to any Eurodollar Rate Advances, (i) the
Liquidity Agent shall have determined in good faith (which determination shall
be conclusive and binding upon the Liquidity Borrower) that, by reason of
circumstances affecting the relevant market, adequate and reasonable means do
not exist for ascertaining the Eurodollar Rate for such Liquidity Interest
Period, or (ii) the Majority Liquidity Banks notify the Liquidity Agent that
matching deposits are not available to them in the London interbank market to
fund their respective Advances for any Liquidity Interest Period or that the
Eurodollar Rate for any Liquidity Interest Period for such Advances will not
adequately reflect the cost to such Majority Liquidity Banks of making, funding,
or maintaining their respective Eurodollar Rate Advances for such Liquidity
Interest Period, the Liquidity Agent shall forthwith so notify the Liquidity
Borrower and the Liquidity Banks, whereupon:
(i) each Eurodollar Rate Advance, to the extent not then
repaid, will automatically, on the last day of the then existing Liquidity
Interest Period therefor, Convert into a Base Rate Advance for a Liquidity
Interest Period of one day or such other
-19-
maturity as the Liquidity Borrower may select by notice to the Liquidity Agent
as contemplated by Section 2.08(b)),
(ii) the obligation of the Liquidity Banks to make or to
Continue, or to Convert Advances into, Eurodollar Rate Advances shall be
suspended until the Liquidity Agent shall notify the Liquidity Borrower and the
Liquidity Banks that the circumstances causing such suspension no longer exist;
and
(iii) any Notice of Borrowing or Notice of
Conversion/Continuation with respect to a Eurodollar Rate Advance shall be
automatically withdrawn and deemed to be a request for a Base Rate Advance.
(c) If the Liquidity Borrower shall fail to select the
maturity of any Liquidity Interest Period for any Eurodollar Rate Advances in
accordance with the provisions contained in the definition of "Liquidity
Interest Period," or otherwise fails to deliver a Notice of
Conversion/Continuation with respect to an Advance by the last day of the
Liquidity Interest Period for such Advance, the Liquidity Agent will forthwith
so notify the Liquidity Borrower and the Liquidity Banks and:
(i) with respect to Funding Advances which constitute
Eurodollar Rate Advances, such Advances, to the extent not then repaid, will
automatically, on the last day of the then existing Liquidity Interest Period
therefor, Convert into Base Rate Advances for a Liquidity Interest Period of one
day; and
(ii) with respect to Funding Advances which
constitute Base Rate Advances, such Advances, to the extent not then repaid,
will automatically, on the last day of the then existing Liquidity Interest
Period therefor, Continue as Base Rate Advances for a Liquidity Interest Period
of one day.
(d) On the date on which the aggregate unpaid principal amount
of Advances constituting any Liquidity Borrowing shall be reduced by payment or
prepayment or otherwise, to less than $1,000,000 such Advances shall, if they
are Advances of a Type other than Base Rate Advances, automatically Convert into
Base Rate Advances for a Liquidity Interest Period of one day or such other
maturity as the Liquidity Borrower may elect by notice to the Liquidity Agent as
contemplated by Section 2.08(b), and on and after such date the right of the
Liquidity Borrower to Convert such Advances into Advances of a Type other than
Base Rate Advances shall terminate unless such Advances are combined with the
Advances constituting another Liquidity Borrowing, as contemplated by Section
2.08(a), with the result that the aggregate unpaid principal balance of all the
Advances so combined equals or exceeds $1,000,000.
SECTION II.8 Voluntary Conversion and Continuation of Advances.
(a) Subject to Section 3.02, the Liquidity Borrower shall have
the option, until one month prior to the Scheduled Liquidity Maturity Date,
exercisable on the last
-20-
day of each Liquidity Interest Period for any Advance (A) to Convert all or any
portion of any outstanding Base Rate Advances to Eurodollar Rate Advances upon
the expiration date of the Liquidity Interest Period applicable to such Base
Rate Advances, (B) to Convert all or any portion of any outstanding Eurodollar
Rate Advances to Base Rate Advances upon the expiration date of the Liquidity
Interest Period applicable to such Eurodollar Rate Advances or (C) upon the
expiration of the Liquidity Interest Periods applicable to any outstanding
Eurodollar Rate Advances or Base Rate Advances, to Continue all or any portion
of such Eurodollar Rate Advances as Eurodollar Rate Advances or such Base Rate
Advances as Base Rate Advances; provided, however, the Liquidity Borrower shall
in no event Convert or Continue all or any portion of any Advance unless each
other Advance comprised by the Liquidity Borrowing that includes that Advance
(if any) is correspondingly Converted or Continued, as applicable. The Liquidity
Borrower's right to Convert or Continue Advances pursuant to this Section 2.08
shall be understood to include the right (i) to divide any Liquidity Borrowing
on the last day of the applicable Liquidity Interest Period into two or more
Liquidity Borrowings having aggregate principal equal to the aggregate principal
of such Liquidity Borrowing or (ii) to combine any two or more Liquidity
Borrowings originating on the last day of such Liquidity Interest Period or
having a Liquidity Interest Period ending on such date into a single Liquidity
Borrowing having aggregate principal equal to the aggregate principal of such
Liquidity Borrowings. The succeeding Liquidity Interest Periods of Converted or
Continued Advances shall commence on the last day of the Liquidity Interest
Periods for the Advances so Converted or Continued. If, after giving effect to
any combination or division of Liquidity Borrowings as contemplated by this
Section 2.08(a), the aggregate unpaid principal amount of the Advances
constituting a Liquidity Borrowing is less than $1,000,000, those Advances may
not be Converted into or Continued as Eurodollar Rate Advances.
(b) To Convert or Continue any Advance under Section 2.08(a),
the Liquidity Borrower shall deliver telephonic notice (a "Notice of
Conversion/Continuation") to the Liquidity Agent not later than 10:00 A.M. (New
York City time) on (i) the third Business Day prior to the date of the proposed
Conversion/Continuation if the Advance is to be Converted into or Continued as a
Eurodollar Rate Advance and (ii) the date of the proposed
Conversion/Continuation if the Advance is to be Converted into or Continued as a
Base Rate Advance. The Liquidity Agent shall then give each Liquidity Bank
prompt notice thereof (in any event not later than 11:00 A.M. (New York City
time) on such day) by telephone or facsimile. As soon as practicable after 10:00
A.M. (New York City time) on the same day, the Liquidity Borrower shall deliver
a Notice of Conversion/Continuation in the form of that attached hereto as
Exhibit E to the Liquidity Agent by facsimile, specifying (i) the date of such
proposed Conversion/Continuation (which shall be a Business Day), (ii) the
Advances to be Converted and/or Continued, (iii) the principal amount of the
Advances to be Converted and/or Continued, (iv) whether such Advance is to be
Converted or Continued, and (v) the requested Liquidity Interest Period for such
Converted and/or Continued Advance. Any Notice of Conversion/Continuation (or
telephonic notice thereof) shall be irrevocable, and the Liquidity Borrower
shall be bound to Convert or to Continue the Advances in accordance therewith.
If the Liquidity Borrower fails to deliver a Notice of Conversion/Continuation
with respect to an Advance by the last day of the Liquidity Interest Period for
such Advance, such Advance shall be Converted or Continued as a Base Rate
Advance on the last day of the related Liquidity Interest
-21-
Period for a Liquidity Interest Period of one day.
(c) Prior to 12:30 P.M. (New York City time) on the date of
any Conversion of Downgraded Bank Advances into Funding Advances pursuant to
this Section 2.08, the Liquidity Agent shall debit each Downgraded Bank Account
by transfer of immediately available funds in an amount equal to the applicable
Liquidity Bank's Pro Rata Share (or other applicable portion) of the amount of
Advances so Converted. After the Liquidity Agent's receipt of such funds (or, at
the Liquidity Agent's option, such earlier time as permitted pursuant to Section
2.12(c)), and upon fulfillment of the applicable conditions set forth in Article
III and subject to the terms and conditions of this Section 2.08, the Liquidity
Agent will make such funds available no later than 1:00 P.M. (New York City
time) to the Tender Agent for payment of such Low Floater Certificates as
designated by the Tender Agent to the Liquidity Agent.
(d) After the occurrence and during the continuation of a
Liquidity Event of Default, all Funding Advances shall, at the end of their then
current Liquidity Interest Periods, be converted to Base Rate Advances having
Liquidity Interest Periods specified from time to time by the Liquidity Agent.
SECTION II.9 Prepayments. The Liquidity Borrower may on any Business
Day, upon telephonic notice (confirmed promptly by facsimile) to the Liquidity
Agent not later than 12:00 noon (New York City time) on (i) the third Business
Day prior to the date of the proposed prepayment if the Advances to be prepaid
are Eurodollar Rate Advances and (ii) the date of the proposed prepayment if the
Advances to be prepaid are Base Rate Advances, prepay the outstanding principal
amounts of the Advances constituting the same Liquidity Borrowing in whole or
ratably in part, together with accrued interest to the date of such prepayment
and reimbursement for any costs or expenses of the type described in Section
8.04(b) incurred by each relevant Liquidity Bank as a result of such prepayment.
SECTION II.10 Fees
(a) The Owner Trust agrees to pay to the Liquidity Agent, for
the account of each Liquidity Bank, a one-time closing fee equal to 0.03% of
such Liquidity Bank's Liquidity Commitment on the Effective Date hereof.
(b) The Owner Trust agrees to pay to the Liquidity Agent, for
the account of each Liquidity Bank the Liquidity Commitment Fee, payable monthly
in arrears on the last Business Day of each month (or within ten Business Days
thereof), during the term of such Liquidity Bank's Liquidity Commitment.
(c) The Owner Trust agrees to pay to the Liquidity Agent for
its own account a Liquidity Agent Fee on such terms and in such amounts as set
forth in the separate letter agreement dated as of May 21, 1998.
SECTION II.11 Increased Costs; Increased Capital.
-22-
(a) If, after the date hereof due to either (i) the
introduction of or any change in or to the interpretation of any law or
regulation by the governmental authority that promulgated or administers
compliance with such law or regulation (other than laws or regulations with
respect to income taxes or any change by way of imposition or increase of
reserve requirements included in the Eurodollar Reserve Percentage) or (ii) the
compliance with any guideline or request from any central bank or other
governmental authority or similar agency (whether or not having the force of
law), any reserve or deposit or similar requirement shall be imposed, modified
or deemed applicable or, any basis of taxation shall be changed or any other
condition shall be imposed, and there shall be any increase in the cost to any
Liquidity Bank of making, funding, or maintaining Advances or in the cost to any
Liquidity Bank of agreeing to make, fund, or maintain Advances (including the
reduction of any sum received or receivable hereunder), then the Liquidity
Borrower shall from time to time, subject to the provisions of Section 8.08
hereof, upon demand by such Liquidity Bank by the submission of the certificate
described below (with a copy of such certificate to the Liquidity Agent), pay to
the Liquidity Agent for the account of such Liquidity Bank additional amounts
sufficient to compensate such Liquidity Bank for such increased cost; provided,
however, that before making any such demand, each Liquidity Bank agrees to use
reasonable efforts (consistent with its internal policy and legal and regulatory
restrictions) to designate a different Applicable Lending Office if the making
of such a designation would avoid the need for, or reduce the amount of, such
additional cost and would not, in the judgment of such Liquidity Bank, be
otherwise disadvantageous to such Liquidity Bank or result in any unreimbursed
costs or expenses which it deems to be material. A certificate setting forth in
reasonable detail the amount of such increased cost submitted to the Liquidity
Borrower and the Liquidity Agent by such Liquidity Bank shall be conclusive and
binding for all purposes, absent manifest error. Notwithstanding the foregoing,
the Liquidity Borrower shall not be obligated to pay any amounts under this
Section 2.11(a) to the extent such amounts resulted from an increased cost
incurred or amount not received which, in each case, occurred more than 90 days
prior to the date of the certificate in which such amounts were set forth.
(b) If any Liquidity Bank determines that compliance with any
law or regulation or any guideline or request or any written interpretation from
any central bank or other governmental authority or similar agency (whether or
not having the force of law) which is introduced, implemented or received by
such Liquidity Bank after the date hereof, affects or would affect capital
adequacy or the amount of capital required or expected to be maintained by such
Liquidity Bank or any corporation controlling such Liquidity Bank and that the
amount of such capital is increased by or based upon the Advances or the
existence of such Liquidity Bank's commitment to lend hereunder and other
commitments of this type, or has or would have the effect of reducing the rate
of return on capital, then, upon demand by such Liquidity Bank by the submission
of the certificate described below (with a copy of such certificate to the
Liquidity Agent), the Liquidity Borrower shall, subject to the provisions of
Section 8.08 hereof, pay to the Liquidity Agent for the account of such
Liquidity Bank, from time to time as specified by such Liquidity Bank,
additional amounts sufficient to compensate such Liquidity Bank or such
corporation in the light of such circumstances, to the extent that such
Liquidity Bank reasonably determines such increase in capital to be allocable to
the Advances or the existence of such Liquidity Bank's commitment to lend
hereunder. A certificate setting forth in reasonable detail
-23-
such amounts submitted to the Liquidity Borrower and the Liquidity Agent by such
Liquidity Bank shall be conclusive and binding for all purposes, absent manifest
error. Notwithstanding the foregoing, the Liquidity Borrower shall not be
obligated to pay any amounts under this Section 2.11(b), to the extent such
amounts resulted from a reduction to such Liquidity Bank's rate of return on
capital which reduction occurred more than 90 days prior to the date of the
certificate in which such amounts were set forth.
(c) Each Liquidity Bank shall use reasonable efforts to notify
the Liquidity Borrower and the Liquidity Agent in the event such Liquidity Bank
determines that it is likely that such Liquidity Bank will be making a demand
for compensation under this Section 2.11, provided, that the failure of a
Liquidity Bank to provide such notice shall not relieve the Liquidity Borrower
of any of its obligations hereunder.
SECTION II.12 Payments and Computations.
(a) The Liquidity Borrower shall make each payment hereunder,
subject to the provisions of Section 8.08 hereof, not later than 3:00 P.M. (New
York City time) on the day when due in Dollars to the Liquidity Agent by wire to
its account at The Chase Manhattan Bank, New York, Fed ABA #000000000, Account
of: Bayerische Landesbank, New York Branch, Account #000-0-00000, Reference:
Charter MAC, or as otherwise specified from time to time by the Liquidity Agent
by written notice to the Liquidity Borrower. Upon receipt of such payment, the
Liquidity Agent will promptly thereafter cause to be distributed like funds
relating to the payment of principal or interest or fees hereunder ratably (or
as otherwise prescribed herein) to the Liquidity Banks for the account of their
respective Applicable Lending Offices, and like funds relating to the payment of
any other amount payable hereunder to any Liquidity Bank to such Liquidity Bank
for the account of its Applicable Lending Office, in each case to be applied in
accordance with the terms of this Agreement. Upon its acceptance of an
Assignment and Acceptance and recording of the information contained therein in
the Register pursuant to Section 8.06(d), from and after the "Transfer Date"
specified in such Assignment and Acceptance, the Liquidity Agent shall make all
payments hereunder in respect of the interest assigned thereby to the Liquidity
Bank's assignee thereunder, and the parties to such Assignment and Acceptance
shall make all appropriate adjustments in such payments for periods prior to
such effective date directly between themselves.
(b) All computations of interest using the Base Rate hereunder
shall be calculated on the basis of a year of 365 (or 366, as the case may be)
days for the actual number of days (including the first day but excluding the
last day) occurring in the period for which such interest hereunder is payable
and all other computations of interest and fees hereunder shall be made by the
Liquidity Agent on the basis of a year of 360 days for the actual number of days
(including the first day but excluding the last day) occurring in the period for
which such interest or fees hereunder is payable. Each determination by the
Liquidity Agent of an interest rate hereunder shall be conclusive and binding
for all purposes, absent manifest error.
(c) Unless the Liquidity Agent shall have received notice from
a Liquidity Bank on the Business Day prior to the date of any Liquidity
Borrowing that such
-24-
Liquidity Bank will not make available to the Liquidity Agent the amount
required to be made available by such Liquidity Bank as part of such Liquidity
Borrowing, the Liquidity Agent may assume that such Liquidity Bank has made such
amount available to the Liquidity Agent on the date of such Liquidity Borrowing
in accordance with Section 2.03, and the Liquidity Agent may (but it shall not
be required to), in reliance upon such assumption, make available to the
Liquidity Borrower on such date a corresponding amount. If and to the extent
that such Liquidity Bank shall not have so made such amount available to the
Liquidity Agent, such Liquidity Bank and the Liquidity Borrower severally agree
to repay to the Liquidity Agent forthwith on demand such corresponding amount
together with interest thereon, for each day from the date such amount is made
available to the Liquidity Borrower until the date such amount is repaid to the
Liquidity Agent, at (i) in the case of the Liquidity Borrower, the interest rate
or rates applicable to such amount and (ii) in the case of such Liquidity Bank,
the Federal Funds Rate. If such Liquidity Bank shall repay to the Liquidity
Agent such corresponding amount, such repaid amount shall constitute such
Liquidity Bank's Advance as part of such Liquidity Borrowing for purposes of
this Agreement.
(d) Whenever any payment hereunder shall be stated to be due
on a day other than a Business Day, such payment shall be made on the next
succeeding Business Day, and such extension of time shall in such case be
included in the computation of payment of interest or any fee payable hereunder,
as the case may be, provided, however, that, if such extension would cause
payment of interest on or principal of Eurodollar Rate Advances to be made in
the next following month, such payment shall be made on the next preceding
Business Day.
SECTION II.13 Illegality. Notwithstanding any other provision
of this Agreement, if any Liquidity Bank shall notify the Liquidity Agent that
the introduction of or any change in or in the interpretation of any law or
regulation makes it unlawful, or any central bank or other governmental
authority asserts that it is unlawful, for any Liquidity Bank or its Applicable
Lending Office to perform its obligations hereunder to make Eurodollar Rate
Advances or to fund or maintain Eurodollar Rate Advances hereunder, (i) the
obligation of the Liquidity Banks to make or to Continue, or to Convert Advances
into, Eurodollar Rate Advances shall be suspended until the Liquidity Agent
shall notify the Liquidity Borrower and the Liquidity Banks that the
circumstances causing such suspension no longer exist and (ii) the Liquidity
Borrower shall, within five Business Days of notice from the Liquidity Agent,
Convert all Eurodollar Rate Advances of all Liquidity Banks then outstanding
into Base Rate Advances in accordance with Section 2.08, but without the
requirement that such Conversion take place on the last day of the respective
Liquidity Interest Periods for such Eurodollar Rate Advances.
SECTION II.14 Taxes.
(a) Any and all payments by the Liquidity Borrower hereunder
shall be made, in accordance with Section 2.12, free and clear of and without
deduction for any and all present or future taxes, levies, imposts, duties,
charges, fees, deductions or withholdings, and all liabilities with respect
thereto, that are now or hereafter imposed, levied, collected, withheld or
assessed by any governmental authority having taxing authority, excluding, in
the case of each
-25-
Liquidity Bank and the Liquidity Agent, net income and franchise taxes that are
imposed on such Liquidity Bank or the Liquidity Agent by the United States, any
state or foreign jurisdiction under the laws of which such Liquidity Bank or the
Liquidity Agent (as the case may be) is organized or any political subdivision
thereof and, in the case of each Liquidity Bank, franchise taxes and net income
taxes that are imposed on such Liquidity Bank by the state or foreign
jurisdiction of such Liquidity Bank's Applicable Lending Office or any political
subdivision thereof (all such non-excluded taxes, levies, imposts, deductions,
charges, withholdings, and liabilities being hereinafter referred to as
"Taxes"). If the Liquidity Borrower shall be required by law to deduct any Taxes
from or in respect of any sum payable hereunder to any Liquidity Bank or the
Liquidity Agent, (i) the sum payable shall be increased as may be necessary so
that, after making all required deductions (including deductions applicable to
additional sums payable under this Section 2.14), such Liquidity Bank or the
Liquidity Agent (as the case may be) receives an amount equal to the sum it
would have received had no such deductions been made, (ii) the Liquidity
Borrower shall make such deductions, and (iii) the Liquidity Borrower shall pay
the full amount deducted to the relevant taxation authority or other authority
in accordance with applicable law.
(b) In addition, the Liquidity Borrower agrees to pay any
present or future stamp, sales or documentary taxes or excise or property taxes,
charges, or similar levies that arise from any payment made hereunder or from
the execution, delivery or registration of, or otherwise with respect to, this
Agreement or any other agreement, instrument, or document delivered hereunder,
and agrees to indemnify such Liquidity Bank and the Liquidity Agent for any fees
with respect to or resulting from any delay in paying or the omission to pay
such taxes, charges or levies (hereinafter, "Other Taxes").
(c) The Liquidity Borrower will indemnify each Liquidity Bank
and the Liquidity Agent for the full amount of Taxes or Other Taxes (including,
without limitation, any Taxes or Other Taxes imposed by any jurisdiction on
amounts payable under this Section 2.14) paid by such Liquidity Bank or the
Liquidity Agent (as the case may be) and any liability (including penalties,
interest, and expenses) arising therefrom or with respect thereto; provided that
a Liquidity Bank or the Liquidity Agent, as appropriate, making a demand for
indemnity payment shall provide the Liquidity Borrower, at its address referred
to in Section 8.02, with a certificate from the relevant taxing authority or
from a responsible officer of such Liquidity Bank or the Liquidity Agent stating
or otherwise evidencing that a Liquidity Bank or the Liquidity Agent has made
payment of such Taxes or Other Taxes and will provide a copy of or extract from
documentation, if available, furnished by such taxing authority evidencing
assertion or payment of such Taxes or Other Taxes. This indemnification shall be
made within 30 days, to the extent there are Available Funds therefor pursuant
to the provisions of Section 8.08 hereof, from the date such Liquidity Bank or
the Liquidity Agent (as the case may be) makes written demand therefor.
(d) Within 30 days after the date of any payment of Taxes or
Other Taxes, the Liquidity Borrower will furnish to the Liquidity Agent, at its
address referred to in Section 8.02, appropriate evidence of payment thereof.
-26-
(e) The Liquidity Agent and each Liquidity Bank that is not
created or organized under the laws of the United States or a political
subdivision thereof shall, to the extent that it may then do so under applicable
laws and regulations, deliver to the Liquidity Borrower (with, in the case of
each Liquidity Bank, a copy to the Liquidity Agent) (i) on or prior to the date
hereof, or, if later, the date on which such Liquidity Bank becomes a Liquidity
Bank pursuant to Section 8.06 hereof or pursuant to a Joinder Agreement, two (or
such other number as may from time to time be prescribed by applicable laws or
regulations) duly completed copies of IRS Form 4224 or Form 1001 (or any
successor forms or other certificates or statements which may be required from
time to time by the relevant United States taxing authorities or applicable laws
or regulations), as appropriate, to permit the Liquidity Borrower to make
payments hereunder for the account of such Liquidity Bank or the Liquidity
Agent, as the case may be, without deduction or withholding of United States
federal income or similar taxes and (ii) upon the obsolescence of or after the
occurrence of any event requiring a change in, any form or certificate
previously delivered pursuant to this Section 2.14(e), copies (in such numbers
as may be from time to time be prescribed by applicable laws or regulations) of
such additional, amended, or successor forms, certificates or statements as may
be required under applicable laws or regulations to permit the Liquidity
Borrower and the Liquidity Agent to make payments hereunder for the account of
such Liquidity Bank or the Liquidity Agent, as the case may be, without
deduction or withholding of United States federal income or similar taxes.
(f) Within 30 days of the written request of the Liquidity
Borrower therefor, at the Liquidity Borrower's expense, the Liquidity Agent and
each Liquidity Bank, as appropriate, shall execute and deliver to the Liquidity
Borrower such certificates, forms, or other documents which can be furnished
consistent with the facts and which are reasonably necessary to assist the
Liquidity Borrower in applying for refunds of taxes remitted hereunder.
(g) Without prejudice to the survival of any other agreement
of the Liquidity Borrower hereunder, the agreements and obligations of the
Liquidity Borrower contained in this Section 2.14 shall survive the termination
of this Agreement.
SECTION II.15 Sharing of Payments. Etc. If any Liquidity Bank shall
obtain any payment (whether voluntary, involuntary, through the exercise of any
right of set-off, or otherwise) on account of the Advances made by it (other
than pursuant to Sections 8.04(b), 2.11 or 2.14) in excess of its ratable share
of payments (taking into account Advances made pursuant to Section 2.03(c)) on
account of the Advances obtained by all the Liquidity Banks, such Liquidity Bank
shall forthwith (i) notify each of the other Liquidity Banks of such receipt and
(ii) purchase from the other Liquidity Banks such participation in the Advances
made by them as shall be necessary to cause such purchasing Liquidity Bank to
share the excess payment ratably with each of them; provided, however, that, if
all or any portion of such excess payment is thereafter recovered from such
purchasing Liquidity Bank, such purchase from each Liquidity Bank shall be
rescinded and such Liquidity Bank shall repay to the purchasing Liquidity Bank
the purchase price to the extent of such recovery together with an amount equal
to such Liquidity Bank's ratable share (according to the proportion of (i) the
amount of such Liquidity Bank's required repayment to (ii) the total amount so
recovered from the purchasing Liquidity Bank) of any interest or other amount
paid or payable by the purchasing Liquidity Bank in respect of the
-27-
total amount so recovered. The Liquidity Borrower agrees that any Liquidity Bank
so purchasing a participation from another Liquidity Bank pursuant to this
Section 2.15 may, to the fullest extent permitted by law, exercise all its
rights of payment (including the right of setoff) with respect to such
participation as fully as if such Liquidity Bank were the direct creditor of the
Liquidity Borrower in the amount of such participation.
SECTION II.16 Evidence of Debt. The Advances to the Liquidity Borrower
shall be evidenced by one or more promissory notes of the Liquidity Borrower in
the form of Exhibit F hereto (individually, a "Liquidity Note" and collectively,
the "Liquidity Notes", in each case as the same may be amended, modified or
supplemented, and together with any replacements or substitutions therefor)
payable to the order of each Liquidity Bank in a principal amount equal to such
Liquidity Bank's Liquidity Commitment and dated the date of the issuance
thereof. Each Liquidity Bank shall record and, prior to any transfer of its
Liquidity Note, shall endorse on the schedules forming a part thereof an
appropriate notation to evidence the date and amount of each Advance made by the
Liquidity Bank and each payment of principal and interest made by the Liquidity
Borrower with respect thereto, but the failure to make any such notation as to
the making of an Advance shall not affect the liability of the Liquidity
Borrower in respect of such Advance or the obligation of the Liquidity Bank to
make future Advances. Each Liquidity Bank is hereby irrevocably authorized by
the Liquidity Borrower to endorse its Liquidity Note and to attach to and make a
part of any Liquidity Note a continuation of any such schedule as and when
required.
SECTION II.17 Downgraded Bank Advances; Downgraded Bank Accounts.
(a) If a Downgrade Event occurs and the related Liquidity Bank is not replaced
pursuant to Section 8.06(g) hereof within thirty days of such Downgrade Event,
then the Liquidity Borrower shall, by delivery of a Notice of Borrowing to the
Liquidity Agent, require such Liquidity Bank to make a Downgraded Bank Advance
in an amount equal to the excess of such Liquidity Bank's Liquidity Commitment
over the then outstanding aggregate principal balance of such Liquidity Bank's
Funding Advances. Upon receipt of the proceeds of such Downgraded Bank Advance,
the Liquidity Agent shall deposit such funds into a segregated trust account
(each, a "Downgraded Bank Account"), in the name of the Tender Agent and
referencing the name of such Liquidity Bank, maintained at an Eligible
Depository Institution chosen by the Tender Agent. The Tender Agent will
withdraw funds from each Downgraded Bank Account at the time of, and in
connection with, the making of a Funding Advance pursuant to clause (b) below.
The Tender Agent hereby grants to the Liquidity Agent full power and authority,
on behalf of the Tender Agent, to deposit funds into each Downgraded Bank
Account, all in accordance with the terms of and for the purposes set forth in
this Agreement.
(b) From and after the establishment of a Downgraded Bank
Account with respect to any Liquidity Bank, and until the earliest of (i) the
assignment by such Liquidity Bank of all of its rights pursuant to Section 8.06
hereof, (ii) such Liquidity Bank receiving a short-term unsecured indebtedness
rating of at least A-1 by S&P and P-1 by Xxxxx'x, and (iii) the Liquidity
Commitment Termination Date, all Funding Advances to be made by such Liquidity
Bank shall be made by withdrawing funds from such Downgraded Bank Account, and
all payments of principal with respect to Funding Advances made by such
Liquidity Bank
-28-
(whether or not originally funded from such Liquidity Bank's Downgraded Bank
Account) shall be made by depositing the related funds into such Downgraded Bank
Account. Upon the earliest of (i) the assignment by such Liquidity Bank of all
of its rights pursuant to Section 8.06 hereof, (ii) such Liquidity Bank
receiving a short-term unsecured indebtedness rating of at least A-1 by S&P and
P-1 by Xxxxx'x, and (iii) the Liquidity Commitment Termination Date, all funds
then held in such Downgraded Bank Account (after giving effect to any Funding
Advances to be made on such date) shall be paid by the Liquidity Agent to such
Liquidity Bank, and thereafter all payments of principal with respect to
Advances made by such Liquidity Bank shall be paid directly to such Liquidity
Bank in accordance with the terms of this Agreement.
(c) From and after the establishment of a Downgraded Bank
Account with respect to any Liquidity Bank, and until the earliest of (i) the
assignment by such Liquidity Bank of all of its rights pursuant to Section 8.06
hereof, (ii) such Liquidity Bank receiving a short-term unsecured indebtedness
rating of at least A-1 by S&P and P-1 by Xxxxx'x, and (iii) the Liquidity
Commitment Termination Date, the Tender Agent shall from time to time, at the
direction of the Controlling Person, invest and reinvest the funds on deposit in
the Downgraded Bank Account from time to time held by it in Permitted
Investments (having a maturity of not more than one Business Day from the date
of acquisition). The Tender Agent shall remit, for the account of each relevant
Liquidity Bank, all realized Investment Proceeds earned or received in
connection with the investment of such funds on deposit in the Downgraded Bank
Account of such Liquidity Bank on the first day of each calendar quarter
commencing hereafter (or more frequently as may be acceptable to the Liquidity
Banks and the Tender Agent). Notwithstanding anything contained herein to the
contrary, neither the Liquidity Agent nor the Liquidity Borrower shall have any
liability for any loss arising from any investment or reinvestment made by the
Tender Agent in accordance with, and pursuant to, the provisions hereof.
(d) If a Downgrade Event occurs, the Liquidity Agent will,
upon obtaining actual knowledge thereof, promptly give notice of such to the
Certificate Trust Agent.
ARTICLE III
CONDITIONS PRECEDENT
SECTION III.1 Conditions Precedent to the Effectiveness of this
Agreement. The effectiveness of this Agreement and the Liquidity Commitments of
the Liquidity Banks hereunder are subject to the following conditions precedent:
(a) The Liquidity Agent shall have received in form and
substance satisfactory to the Liquidity Agent originals or copies of each of the
items listed in Schedule II, and shall have received them in sufficient number
of copies for distribution to each Liquidity Bank;
(b) No Liquidity Event of Default described in Section 6.01
(or event which with the lapse of time would constitute such a Liquidity Event
of Default under such Section 6.01) has occurred and is continuing;
-29-
(c) Either the Liquidity Borrower or an Affiliate of the
Liquidity Borrower shall have paid to the Liquidity Agent the closing fee as set
forth in Section 2.10 hereof;
(d) The Surety Bonds shall have been executed by the Surety
Provider, the Liquidity Surety Bond shall have been delivered to the Liquidity
Agent and each such Surety Bond shall be in full force and effect; and
(e) Any representations and warranties of the Liquidity
Borrower contained in the Transaction Documents shall be true and correct and
the Liquidity Agent shall have received such certificates to such effect as are
required to be delivered under the Transaction Documents as a condition to the
effectiveness thereof.
SECTION III.2 Conditions Precedent to Liquidity Borrowings,
Conversions, and Continuations. The obligation of each Liquidity Bank to make an
Advance on the occasion of each Liquidity Borrowing (including the initial
Liquidity Borrowing) or to Convert or Continue any Advance as a Eurodollar Rate
Advance shall be subject only to the conditions precedent that on the date of
such Liquidity Borrowing, Conversion, or Continuation (a) no Liquidity Event of
Default described in Section 6.01 has occurred and is continuing and (b) the
Liquidity Commitment Termination Date has not occurred. The parties hereto
hereby agree that any Advance made pursuant to Section 2.01 hereof shall
constitute a representation and warranty by the Liquidity Borrower that such
Advance is not in excess of the Available Liquidity Amount, as defined in such
Section 2.01 and that the proceeds of such Advance shall only be used as
provided in Section 2.02 hereof.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
SECTION IV.1 Representations and Warranties of the Liquidity Borrower.
The Liquidity Borrower represents and warrants as follows on the date of this
Agreement, the Effective Date, and each date on which an Advance is made, in
each case, with reference to the facts and circumstances then existing:
(a) The representations and warranties made by the Liquidity
Borrower or any Charter Entity (as defined in the Insurance Agreement) in any of
the other Transaction Documents to which it is a party were true and correct
when made and are hereby incorporated by reference for the benefit of the
Liquidity Banks as if fully set forth herein.
(b) ERISA. Neither the Liquidity Borrower nor any ERISA
Affiliate has established or contributed to any Plan.
(c) Investment Company Act; Securities Act. The Liquidity
Borrower
-30-
is not an "investment company" or a company "controlled" by an
"investment company" within the meaning of the Investment Company Act of 1940,
as amended. The issuance and sale of the Low Floater Certificates will be exempt
from the registration requirements of the Securities Act of 1933, as amended.
(d) Taxes. As of the date hereof, all Federal and state tax
returns required to be filed by the Liquidity Borrower have been properly
prepared, executed, and filed. As of the date hereof, all taxes, assessments,
fees, and other governmental charges upon the Liquidity Borrower or upon any of
its properties, income, sales, or franchises which are due and payable have been
paid and there are no liens outstanding or asserted with respect to any such
taxes or charges. The Liquidity Borrower's chief executive office is the same as
its notice address set forth herein.
(e) Compliance with Laws. The Liquidity Borrower is in
compliance in all material respects with all applicable laws, rules and
regulations.
(f) Transaction Documents. Each of the Transaction Documents
to which the Liquidity Borrower is a party are enforceable against the Liquidity
Borrower.
(g) Accuracy of Information. All written information furnished
by the Liquidity Borrower to the Liquidity Banks with respect to the Liquidity
Borrower is true and correct in all material respects and does not omit any
facts necessary under the circumstances to make the information contained
therein not misleading.
(h) No Liquidity Event of Default. No Liquidity Event of
Default (or event which, with the passage of time or giving of notice or both
would constitute a Liquidity Event of Default) has occurred and is continuing.
ARTICLE V
COVENANTS OF THE LIQUIDITY BORROWER
SECTION V.1 Affirmative Covenants. So long as any amount shall remain
owing hereunder or any Liquidity Bank shall have any Liquidity Commitment
hereunder, the Liquidity Borrower will, or with respect to any statement,
certificate or report required to be furnished pursuant to Section 5.01(a)(iv)
hereof, cause the Servicer to:
(a) Reporting Requirements. Furnish to the Liquidity Agent for
distribution to each Liquidity Bank:
(i) Financial Statements. As soon as available and in
any case (i) within 60 days after the end of each of the first three quarters in
each fiscal year, a statement of financial condition of the Liquidity Borrower
as of the end of such quarter, prepared in accordance with GAAP and certified,
subject to changes resulting from subsequent audit
-31-
adjustments, by the respective Authorized Representative with responsibility for
financial reporting matters; and (2) within 120 days after the end of each
fiscal year, a statement of financial condition of the Liquidity Borrower as at
the end of such year, and a statement of revenues and expenses of the Liquidity
Borrower for such year, such financial statements to be audited by, and
accompanied by an opinion of, independent certified public accountants of
nationally recognized standing selected by the Liquidity Borrower, which opinion
shall state that such financial statements have been prepared in accordance with
generally accepted accounting principles consistently applied (except as
otherwise stated in such opinion) and that the audit by such accountants in
connection with such financial statement has been made in accordance with
generally accepted auditing standards;
(ii) Litigation. As soon as possible and in any
event not later than five Business Days after notice to the Liquidity Borrower
of the commencement thereof, notice of any action, suit or proceeding against
the Liquidity Borrower which could, if adversely determined, have a material
adverse effect on the business, financial condition or results of operations of
the Liquidity Borrower or on the ability of the Liquidity Borrower to repay any
Advance or perform any of its other obligations under this Agreement or the
other Transaction Documents;
(iii) Liquidity Event of Default. Immediately after the
Liquidity Borrower knows of the occurrence of any Liquidity Event of Default or
any event or condition which with the giving of notice or lapse of time, or
both, would constitute a Liquidity Event of Default, a certificate of the
Liquidity Borrower specifying the nature of such event or condition and the
action which the Liquidity Borrower has taken and/or proposes to take with
respect thereto;
(iv) Servicer's Report. Promptly after receipt thereof,
a copy of any Settlement Report, Servicer's Certificate, Servicer's Report,
Accountant's Report, notice of Servicer Default or Unmatured Servicer Default,
notice of an Event of Default, Unmatured Event of Default, information on any
event or occurrence that has, or could reasonably be expected to have, a
Material Adverse Effect on the Owner Trust, and notice of any litigation with
respect to the Bonds;
(v) Additional Information. Such other information
respecting the condition or operations, financial or otherwise, of the Liquidity
Borrower as any Liquidity Bank through the Liquidity Agent may from time to time
reasonably request.
(b) Preservation of Existence. Do or cause to be done all
things necessary on its part to preserve and keep in full force and effect its
existence.
(c) Payment of Taxes. Pay and discharge promptly or cause to
be paid and discharged promptly all taxes, assessments and governmental charges
or levies imposed upon it or upon its income or profits or upon any of its
assets, provided that the payment of any such tax, assessment, charge, or levy
shall not be required so long as (i) such non-payment does not result in the
creation of a Lien against any property of the Liquidity Borrower, (ii) the
-32-
amount, applicability, or validity thereof shall be contested in good faith by
appropriate proceedings and (iii) the Liquidity Borrower shall have set aside on
its books adequate reserves in respect thereof (segregated to the extent
required by GAAP).
(d) Exercise of Rights Under Certificate Issuer Trust
Agreement. Exercise its rights under and take such other action in connection
with the Certificate Issuer Trust Agreement and each other Transaction Document
as may be reasonably appropriate or desirable, taking into account the
associated costs, to maximize the collection of amounts payable to the Liquidity
Borrower thereunder; provided, however that the Liquidity Borrower shall have no
obligation to take any action that is unreasonable in the circumstances or
otherwise inconsistent with its credit administration, enforcement, or recovery
procedures and policies.
(e) Books and Records. (i) Maintain at all times true and
complete books, records, and accounts in which true and correct entries shall be
made of its transactions in accordance with GAAP consistently applied and
consistent with those applied in the preparation of the financial statements
referred to in clause (i) of Section 5.01(a) hereof; and (ii) by means of
appropriate annual entries reflected in its accounts and in all financial
statements furnished pursuant to Section 5.01(a) hereof, establish and maintain
proper liabilities and reserves for all taxes and proper reserves for
depreciation, renewal, and replacement, obsolescence and amortization of its
properties and bad debts, all in accordance with GAAP consistently applied as
above.
(f) Compliance with Laws. Comply in all material respects with
all Applicable Laws.
SECTION V.2 Negative Covenants. So long as any amount shall remain
owing hereunder or any Liquidity Bank shall have any Liquidity Commitment
hereunder, the Liquidity Borrower will not:
(a) Issuance of Low Floater Certificates. Issue Low Floater
Certificates at any time in an Outstanding Face Amount such that when added to
the Outstanding Face Amount of Low Floater Certificates previously issued and
outstanding would equal a sum greater than the Stated Portion of the Insured
Amount (as defined in the Certificate Surety Bond) less any payments made to the
beneficiary of the Certificate Surety Bond pursuant to a "Face Amount Notice for
Payment" or to the beneficiary of the Liquidity Surety Bond pursuant to a
"Principal Notice for Payment."
(b) Negative Pledge. Except as otherwise permitted under the
Liquidity Pledge and Security Agreement, (i) sell, assign (by operation of law
or otherwise), or otherwise dispose of any of the Liquidity Collateral, or (ii)
create or suffer to exist any Lien upon or with respect to any of the Liquidity
Collateral (other than pursuant to the Liquidity Pledge and Security Agreement)
to secure indebtedness of any Person.
(c) Merger; Sale of Assets. Be a party to any merger or
consolidation, or purchase or otherwise acquire all or substantially all of the
assets or any stock of any class of,
-33-
or any partnership or joint venture interest in, any other Person, or sell,
transfer, convey, or lease (in one transaction or a series of transactions) all
or substantially all of its assets.
(d) Certificate Issuer Trust Agreement. Amend the Certificate
Issuer Trust Agreement other than pursuant to Section 5.03 hereof.
(e) Change in Business. Engage in any activities other than
those permitted in the Certificate Issuer Trust Agreement.
(f) Indebtedness. Create, incur, guarantee, become surety for,
endorse, assume, or suffer to exist any Debt except for (i) payments with
respect to Low Floater Certificates; (ii) indebtedness hereunder, and (iii)
indebtedness in respect of taxes, assessments or governmental charges to the
extent that the nonpayment thereof shall not result in the creation of a Lien.
SECTION V.3 Amendment of Transaction Documents
(a) The Liquidity Borrower may agree to any amendment,
modification, or waiver of any Transaction Document (other than those set forth
in paragraph (b) below) or any instrument or document delivered pursuant
thereto, provided, that such amendment, modification or waiver shall only be
effective upon the Liquidity Borrower's certification to each Liquidity Bank
that no material adverse effect to such Liquidity Bank's rights, obligations or
interests hereunder would result therefrom (taking into consideration the
existence of the Surety Bonds); provided further, however, that upon and
following the occurrence of a Liquidity Event of Default, no such amendment,
modification or waiver shall be effective unless the prior consent of the
Majority Liquidity Banks shall have been obtained; provided further, however,
that no amendment, modification or waiver of the provisions of the Certificate
Issuer Trust Agreement shall be effective unless the prior written consent of
the Liquidity Agent shall have been obtained.
(b) The Liquidity Borrower will not, without the prior written
consent of each of the Liquidity Banks, (i) amend, modify, waive, supplement,
terminate, or otherwise change any provision of the Liquidity Surety Bond or the
Liquidity Pledge and Security Agreement which could result in a Material Adverse
Change to the Liquidity Banks, or (ii) consent to any assignment of the
obligations of the Surety Provider under either Surety Bond.
ARTICLE VI
EVENTS OF DEFAULT
SECTION VI.1 Events of Default. Each of the following events shall
constitute a "Liquidity Event of Default" hereunder.
(a) The Surety Provider fails to pay when, as and in the
amounts
-34-
required, any amount payable under any Surety Bond and such failure continues
unremedied at the end of the applicable cure period;
(b) If any Liquidity Bank notifies the Liquidity Borrower, the
Tender Agent and the Remarketing Agent that it is aware the Surety Provider is
in default (at the end of the applicable cure period) in the payment when due of
any amount due under any other surety bond or financial guarantee insurance
policy issued by the Surety Provider in support of any obligation rated by S&P
or Xxxxx'x then, after the passage of fourteen calendar days from the date of
such notice, such default shall constitute a Liquidity Event of Default;
provided that, for purposes of this paragraph (b), default shall not include any
failure to make payment under a surety bond or other financial guarantee
insurance policy on the basis that all conditions to and defenses against
payment have not been duly satisfied or waived and with respect to which the
obligation to make payment is being contested in good faith by appropriate
proceedings which shall not be limited to legal proceedings;
(c) (i) the Superintendent of Insurance of the State of New
York (or any Person succeeding to the duties of such Superintendent) (for the
purpose of this paragraph (c), the "Superintendent") shall apply for an order
(A) pursuant to Section 7402 of the New York Insurance Law (or any successor
provisions thereto), directing him to rehabilitate the Surety Provider, (B)
pursuant to Section 7404 of the New York Insurance Law (or any successor
provision thereto), directing him to liquidate the business of the Surety
Provider or (C) pursuant to Section 7416 of the New York Insurance Law (or any
successor provision thereto), dissolving the corporate existence of the Surety
Provider and such application shall not be dismissed or withdrawn during a
period of 60 consecutive days or a court of competent jurisdiction enters an
order granting the relief sought; (ii) the Superintendent shall determine that
the Surety Provider is insolvent within the meaning of Section 1309 of the New
York Insurance Law; (iii) the Surety Provider shall commence a voluntary case or
other proceeding seeking rehabilitation, liquidation, reorganization or other
relief with respect to itself or its debts under any bankruptcy, insolvency or
other similar law now or hereafter in effect or seeking the appointment of a
trustee, receiver, liquidator, custodian or other similar official of it or any
substantial part of its property, or shall consent to any such relief or to the
appointment of or taking possession by any such official in an involuntary case
or other proceeding commenced against it, or shall make a general assignment for
the benefit of creditors; or (iv) an involuntary case or other proceeding shall
be commenced against the Surety Provider seeking rehabilitation, liquidation,
reorganization or other relief with respect to it or its debts under a
bankruptcy, insolvency or other similar law now or hereafter in effect or
seeking the appointment of a trustee, receiver, liquidator, custodian or other
similar official of it or any substantial part of its property for purposes of
distributing its assets or winding up its affairs and such case or proceeding is
not dismissed or otherwise terminated within a period of 60 consecutive days or
a court of competent jurisdiction enters an order granting the relief sought in
such case or proceeding; or
(d) a court of competent jurisdiction shall have determined in
a final, nonappealable order that the Liquidity Surety Bond is no longer in full
force and effect.
SECTION VI.2 Remedies.
-35-
(a) Voluntary Termination. Upon the occurrence of a Liquidity
Event of Default or at any time thereafter during the continuation of such
Liquidity Event of Default, the Liquidity Agent may, with the consent of the
Majority Liquidity Banks, and shall, upon the request of the Majority Liquidity
Banks, declare the Liquidity Commitments to be terminated forthwith, whereupon
the Liquidity Commitments shall immediately terminate. Any such termination of
the Liquidity Commitments shall be set forth in a written notice to the
Liquidity Borrower and the Certificate Trust Agent, with copies thereof to
Xxxxx'x and S&P.
(b) Additional Remedies. Upon the occurrence and during the
continuation of an Event of Default, the Liquidity Banks shall have, in addition
to all other rights and remedies under this Agreement and the other Transaction
Documents, all the other rights and remedies provided under the UCC of each
applicable jurisdiction and other applicable laws, which rights shall be
cumulative. Except as expressly provided above in this Section, presentment,
demand, protest and all other notices of any kind are hereby expressly waived.
SECTION VI.3 Notice of Certain Events. The Surety Provider will give
notice to the Liquidity Borrower, Liquidity Banks, Liquidity Agent, the
Certificate Trust Agent and the Remarketing Agent of the commencement of any
action that, if decided adversely, could result in the occurrence of an Event of
Default described in Section 6.01(b) or 6.01(d). The Liquidity Agent will give
notice to the Administrative Agent of the occurrence of any Liquidity Event of
Default.
ARTICLE VII
THE LIQUIDITY AGENT
SECTION VII.1 Authorization and Action.
(a) Each Liquidity Bank hereby appoints and authorizes the
Liquidity Agent and the Liquidity Collateral Agent to take such action as agent
on its behalf and to exercise such powers under this Agreement, the Liquidity
Pledge and Security Agreement, the Insurance Agreement and the other Transaction
Documents, as are delegated to the Liquidity Agent and the Liquidity Collateral
Agent, respectively, by the terms hereof and thereof, together with such powers
as are reasonably incidental thereto. As to any matters not expressly provided
for by this Agreement or any other Transaction Document (including, without
limitation, enforcement or collection of the indebtedness resulting from the
Advances), neither the Liquidity Agent nor the Liquidity Collateral Agent shall
be required to exercise any discretion or take any action, but shall be required
to act or to refrain from acting (and shall be fully protected in so acting or
refraining from acting) upon the instructions of the Majority Liquidity Banks
or, in the case of the Liquidity Collateral Agent, of the Liquidity Agent, and
such instructions shall be binding upon all the Liquidity Banks (and the
Liquidity Agent, as the case may be); provided, however, that neither the
Liquidity Agent nor the Liquidity Collateral Agent shall be required to take any
action which exposes it to personal liability or which is contrary to this
Agreement, any
-36-
other Transaction Document, or applicable law or which it believes to be
commercially unreasonable. The Liquidity Agent agrees to give to each Liquidity
Bank prompt notice of each notice given to it by the Liquidity Borrower pursuant
to the terms of this Agreement. Neither the Liquidity Agent nor the Liquidity
Collateral Agent shall have any duties or responsibilities, except those
expressly set forth herein or in the Liquidity Pledge and Security Agreement, or
any fiduciary relationship with any of the Liquidity Banks and no implied
covenants, functions, responsibilities, duties, obligations or liabilities shall
be read into this Agreement or any other Facility Document or otherwise exist
against either the Liquidity Agent or the Liquidity Collateral Agent.
(b) Without limitation to any other provision of this Article
VII, each of the Liquidity Banks hereby (x) authorizes the Liquidity Agent to
execute and deliver the Insurance Agreement on its behalf, and to take such
action as agent on its behalf and to exercise such powers under the Insurance
Agreement as are delegated to the Liquidity Agent by the terms thereof, together
with such powers as are reasonably incidental thereto, (y) agrees that the
execution and action by the Liquidity Agent under this Section 7.01(b) shall be
binding upon such Liquidity Bank and its successors and assigns, and (z) agrees
that each of the provisions of this Article VII in favor of the Liquidity Agent
acting in its capacity as agent for the Liquidity Banks under this Agreement and
the Insurance Agreement shall inure to the benefit of the Liquidity Agent acting
in its capacity as agent for the Liquidity Banks under the Insurance Agreement.
(c) Without limitation to any other provision of this Article
VII, each of the Liquidity Banks and the Liquidity Agent hereby (x) authorizes
the Liquidity Collateral Agent to execute and deliver the Liquidity Pledge and
Security Agreement on its behalf, and to take such action as agent on its behalf
and to exercise such powers under the Liquidity Pledge and Security Agreement as
are delegated to the Liquidity Collateral Agent by the terms thereof, together
with such powers as are reasonably incidental thereto, (y) agrees that the
execution and action by the Liquidity Collateral Agent under this Section
7.01(c) shall be binding upon such Liquidity Bank, the Liquidity Agent and each
of their respective successors and assigns, and (z) agrees that each of the
provisions of this Article VII in favor of the Liquidity Agent acting in its
capacity as agent for the Liquidity Banks and the Liquidity Agent under the
Agreement shall inure to the benefit of the Liquidity Collateral Agent acting in
its capacity as agent for the Liquidity Banks and the Liquidity Agent under the
Liquidity Pledge and Security Agreement.
SECTION VII.2 Liquidity Agent's Reliance Etc. Neither the Liquidity
Agent, the Liquidity Collateral Agent nor any of their respective shareholders,
directors, officers, agents, or employees nor any other Person assisting them in
their duties nor any agent or employee thereof shall be liable for any waiver,
consent or appraisal given or any action taken or omitted to be taken in good
faith by it or them under or in connection with this Agreement or any other
Transaction Document, or be responsible for the consequences of any oversight or
error of judgment whatsoever, except for the Liquidity Agent's or the Liquidity
Collateral Agent's (as the case may be) own gross negligence or willful
misconduct. Without limiting the generality of the foregoing, the Liquidity
Agent and the Liquidity Collateral Agent: (i) may treat the Liquidity Bank that
made any Advance as the holder of the indebtedness resulting therefrom until the
-37-
Liquidity Agent receives and accepts an Assignment and Acceptance entered into
by such Liquidity Bank, as assignor, and an Eligible Assignee, as assignee, as
provided in Section 8.06; (ii) may consult with legal counsel (including counsel
for the Liquidity Borrower), independent public accountants and other experts
selected by it and shall not be liable for any action taken or omitted to be
taken in good faith by it in accordance with the advice of such counsel,
accountants or experts; (iii) makes no warranty or representation to any
Liquidity Bank and shall not be responsible to any Liquidity Bank for any
statements, warranties or representations (whether written or oral) made in or
in connection with this Agreement or any other Transaction Document; (iv) shall
not have any duty to ascertain or to inquire as to the performance or observance
of any of the terms, covenants, or conditions of this Agreement or any other
Transaction Document on the part of the Liquidity Borrower or to inspect the
property (including the books and records) of the Liquidity Borrower; (v) shall
not be responsible to any Liquidity Bank for the due execution, legality,
validity, enforceability, genuineness, sufficiency, or value of this Agreement,
the other Transaction Documents, or any other instrument or document furnished
pursuant hereto or thereto; and (vi) shall incur no liability under or in
respect of this Agreement or any other Transaction Document by acting upon any
notice, consent, certificate, or other instrument or writing (which may be by
facsimile or telegram) reasonably believed by it to be genuine and signed or
sent by the proper party or parties.
SECTION VII.3 Tender Agent; Liquidity Agent and Affiliates.
(a) Each Liquidity Bank acknowledges that any obligation of
the Liquidity Borrower hereunder may be performed by the Tender Agent on the
Liquidity Borrower's behalf.
(b) The Liquidity Agent, or any successor Liquidity Agent and
its affiliates may accept deposits from, lend money to, act as trustee under
indentures of, the Liquidity Borrower and Charter, and each of the Liquidity
Agent, or any successor Liquidity Agent, as the case may be, and the Surety
Provider may generally engage in any kind of business with the Liquidity
Borrower and Charter, any of their subsidiaries, and any Person who may do
business with or own securities of the Liquidity Borrower or Charter or any such
subsidiary, all as if the Liquidity Agent or any successor Liquidity Agent, as
the case may be, was not the Liquidity Agent and the Liquidity Collateral Agent
and without any duty to account therefor to the Liquidity Banks.
SECTION VII.4 Liquidity Bank Credit and Lending Decision.
(a) Each Liquidity Bank acknowledges that (i) it has,
independently and without reliance upon the Surety Provider, the Liquidity
Borrower, the Liquidity Agent, the Liquidity Collateral Agent, the Tender Agent
or any other Liquidity Bank, and based on such financial statements and such
other documents and information as it has deemed appropriate, made its own
credit analysis and decision to enter into this Agreement and the other
Transaction Documents to which it is a party, and that (ii) the commitment being
entered into herein has been approved through its regular approval process and
is duly authorized as a result of same. Each Liquidity Bank also acknowledges
that it will, independently and without reliance upon the
-38-
Surety Provider, the Liquidity Borrower, the Liquidity Agent, the Liquidity
Collateral Agent, the Tender Agent or any other Liquidity Bank and based on such
documents and information as it shall deem appropriate at the time, continue to
make its own credit decisions in taking or not taking action under this
Agreement and such other Transaction Documents.
(b) Each Liquidity Bank acknowledges that its execution,
delivery and performance of this Agreement complies with the legal lending
limits of the institution.
(c) Each Liquidity Bank acknowledges that to the best of its
officers' knowledge, information and belief, there is not regulatory or legal
impediment to its execution, delivery and performance of this Agreement.
SECTION VII.5 Indemnification. The Liquidity Banks agree to indemnify
the Liquidity Agent and the Liquidity Collateral Agent (to the extent not
reimbursed by the Liquidity Borrower), ratably according to the respective
aggregate principal amount of the Advances then owing to each of them (or if no
such Advances are at the time outstanding, ratably according to the respective
amounts of their Liquidity Commitments or, if the Liquidity Commitments have
theretofore terminated, the amounts of such Liquidity Commitments immediately
prior to their termination), from and against any and all liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses, or disbursements of any kind or nature whatsoever which may be imposed
on, incurred by, or asserted against the Liquidity Agent or the Liquidity
Collateral Agent, as the case may be, in any way relating to or arising out of
this Agreement, any of the other Transaction Documents or the transactions
contemplated hereby or thereby, or any action taken or omitted by the Liquidity
Agent or the Liquidity Collateral Agent, as the case may be, in such capacity
under this Agreement or any of the other Transaction Documents, provided, that
no Liquidity Bank shall be liable for any portion of such liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements resulting from the Liquidity Agent's or the Liquidity
Collateral Agent's, as applicable, gross negligence or willful misconduct.
Without limitation to the foregoing, each Liquidity Bank agrees to reimburse the
Liquidity Agent or the Liquidity Collateral Agent, as the case may be, promptly
upon the Liquidity Agent's or the Liquidity Collateral Agent's demand for such
Liquidity Bank's ratable share of any out-of-pocket expenses (including
reasonable counsel fees) incurred by the Liquidity Agent or the Liquidity
Collateral Agent, as the case may be, in connection with the preparation,
execution, delivery, administration, modification, amendment, waiver, or
enforcement (whether through negotiations, legal proceedings or otherwise) of,
or legal advice in respect of rights or responsibilities under, this Agreement
or any of the other Transaction Documents, to the extent that the Liquidity
Agent or the Liquidity Collateral Agent, as the case may be, is not reimbursed
for such expenses by the Liquidity Borrower.
SECTION VII.6 Successor Liquidity Agent. The Liquidity Agent may resign
at any time by giving written notice thereof to the Liquidity Banks and the
Liquidity Borrower and the Administrative Agent and may be removed at any time
with or without cause by the Majority Liquidity Banks upon written notice
thereof to the Liquidity Agent and the Liquidity Borrower. Such resignation or
removal shall become effective as set forth below. The
-39-
Majority Liquidity Banks shall have the right to appoint a successor Liquidity
Agent, provided that each of the Surety Provider and the Liquidity Borrower
shall have the right to approve the successor Liquidity Agent, which approval
shall not be unreasonably withheld or delayed. If no successor Liquidity Agent
shall have been so appointed by the Majority Liquidity Banks and approved by the
Liquidity Borrower, and shall have accepted such appointment, within 30 days
after the retiring Liquidity Agent's giving of notice of resignation or the
Majority Liquidity Banks' removal of the retiring Liquidity Agent, then the
retiring Liquidity Agent may, on behalf of the Liquidity Banks, appoint a
successor Liquidity Agent, which successor Liquidity Agent shall be either a
commercial bank having a combined capital and surplus of at least $250,000,000
or an Affiliate of such an institution, which shall in either case have a
short-term unsecured indebtedness rating of at least A-1 by S&P and P-1 by
Xxxxx'x. Upon the acceptance of any appointment as Liquidity Agent hereunder by
a successor Liquidity Agent, such successor Liquidity Agent shall thereupon
succeed to and become vested with all the rights, powers, privileges, and duties
of the retiring Liquidity Agent, and the retiring Liquidity Agent shall be
discharged from its duties and obligations under this Agreement and the other
Transaction Documents. After any retiring Liquidity Agent's resignation or
removal hereunder as Liquidity Agent, the provisions of this Article VII shall
inure to its benefit as to any actions taken or omitted to be taken by it while
it was Liquidity Agent under this Agreement and the other Transaction Documents.
ARTICLE VIII
MISCELLANEOUS
SECTION VIII.1 Amendments, Etc. No amendment or waiver of any provision
of this Agreement, nor consent to any departure by the Liquidity Borrower
therefrom, shall in any event be effective unless the same shall be in writing
and signed by the Liquidity Borrower, the Surety Provider and the Majority
Liquidity Banks, and then such waiver or consent shall be effective only in the
specific instance and for the specific purpose for which given; provided,
however, that no amendment, waiver, or consent shall, unless in writing and
signed by all the Liquidity Banks, do any of the following: (a) amend or waive
or consent to any departure from any of the conditions specified in Section
3.02, (b) except as provided in Section 2.04(b), increase the Liquidity
Commitments of the Liquidity Banks or subject the Liquidity Banks to any
additional obligations, (c) reduce the principal of, or interest on, the
Advances or any fees hereunder or other amounts payable hereunder, (d) postpone
any date fixed for any payment of principal of, or interest on, the Advances or
any fees hereunder or other amounts payable hereunder, (e) change the percentage
of the Liquidity Commitments or of the aggregate unpaid principal amount of the
Advances which shall be required for the Liquidity Banks or any of them to take
any action hereunder, (f) amend, waive or consent to any departure from this
Section 8.01, (g) amend, terminate or waive any Surety Bond, (h) amend the
definition of Majority Liquidity Banks or (i) except as provided in Section
5.02(b), consent to the sale, assignment or other disposition of any Liquidity
Collateral; provided, further, that no amendment, waiver, or consent shall,
unless in writing and signed by the Liquidity Agent in addition to the Liquidity
Banks required above to take such action, affect the rights or duties of the
Liquidity Agent under
-40-
this Agreement. No material amendment to this Agreement will be effective until
the Rating Agency has confirmed in writing that the rating then assigned to the
Low Floater Certificates will not be reduced or withdrawn as a result of such
amendment. The Liquidity Agent will provide notice of amendments hereto to the
Administrative Agent at least sixteen (16) days prior to the effective date of
any such amendment.
SECTION VIII.2 Notices, Etc. All notices and other communications
provided for hereunder shall, unless otherwise stated herein, be in writing
(including communication by facsimile copy) and mailed, transmitted, or
delivered, as to each party hereto, at its address and/or number set forth under
its name on Schedule III hereto or specified in such party's Assignment and
Acceptance or Joinder Agreement or at such other address or number as shall be
designated by such party in a written notice to the other parties hereto. All
such notices and communications shall be effective, upon receipt, or in the case
of (i) notice by mail, five days after being deposited in the United States
mails, first class postage prepaid, or (ii) notice by facsimile copy, when
verbal communication of receipt is obtained, except that notices and
communications to the Liquidity Agent pursuant to Article II or VII shall not be
effective until received by the Liquidity Agent. The Liquidity Borrower shall
provide copies of all material notices delivered hereunder, including, without
limitation, any amendments hereto and any assignments under Section 8.06 hereof
or any Joinder Agreement, to Xxxxx'x and S&P, and shall notify S&P and Xxxxx'x
of the date on which the final Low Floater Certificate matures.
SECTION VIII.3 No Waiver; Remedies. No failure on the part of any
Liquidity Bank or the Liquidity Agent to exercise, and no delay in exercising,
any right hereunder shall operate as a waiver thereof; nor shall any single or
partial exercise of any such right preclude any other or further exercise
thereof or the exercise of any other right. The remedies herein provided are
cumulative and not exclusive of any remedies provided by law.
SECTION VIII.4 Costs, Expenses, and Indemnification.
(a) All costs and expenses of the Liquidity Agent and each
Liquidity Bank in connection with the preparation, execution, delivery,
modification, and amendment of this Agreement, the other Transaction Documents
and the other documents to be delivered hereunder and thereunder (whether
incurred prior to the date hereof or after the date hereof in connection with
any amendment, waiver, consent or re-commitment), including, without limitation,
the fees and out-of-pocket expenses of counsel shall be for the Liquidity
Agent's or such Liquidity Bank's own account and shall not be payable by the
Liquidity Borrower. The Liquidity Borrower agrees to pay on demand all costs and
expenses, subject to the provisions of Section 8.08 hereof, if any (including,
without limitation, reasonable counsel fees and expenses), of the Liquidity
Agent and each Liquidity Bank in connection with the enforcement of this
Agreement, the other Transaction Documents and the other documents to be
delivered hereunder and thereunder, including, without limitation, reasonable
counsel fees and expenses in connection with the enforcement of rights under
this Section 8.04(a). The Liquidity Borrower further agrees to indemnify the
Liquidity Agent, each Liquidity Bank and each of their respective affiliates,
control persons, officers, directors, shareholders, employees, and agents (each
an "Indemnified Party"), from and against any and all claims, damages, losses,
liabilities, and
-41-
expenses, (including, without limitation, reasonable fees and disbursements of
counsel) for which any of them may become liable or which may be incurred by or
asserted against any of them in connection with the investigation of,
preparation for, or defense of any pending or threatened claim or any action or
proceeding arising out of, related to or in connection with the transactions
described herein whether or not any Indemnified Party or the Liquidity Borrower
is a party thereto, including, without limitation, any transaction in which any
proceeds of any Liquidity Borrowing are or are proposed to be applied; provided,
however, that the Liquidity Borrower shall not be liable for any portion of such
claims, damages, losses, liabilities, or expenses resulting from such
Indemnified Party's gross negligence or willful misconduct. Without prejudice to
the survival of any other agreement of the Liquidity Borrower hereunder, the
agreements and obligations of the Liquidity Borrower contained in this Section
8.04(a) shall survive the termination of this Agreement.
(b) Notwithstanding anything to the contrary contained herein,
if any Liquidity Borrowing comprising Eurodollar Rate Advances requested
pursuant to Section 2.03 or any Conversion into or Continuation of Eurodollar
Rate Advances requested pursuant to Section 2.08 is not for any reason
whatsoever (including, without limitation, the occurrence of a Liquidity Event
of Default described in Section 6.01(d)) made on the date specified in the
relevant Notice of Liquidity Borrowing or Notice of Conversion/Continuation, as
the case may be, or if any payment of principal of, or Conversion of, any
Eurodollar Rate Advance is made on a day other than the last day of the
Liquidity Interest Period with respect to such Eurodollar Rate Advance
(including, without limitation, pursuant to a mandatory conversion under Section
2.13), the Liquidity Borrower shall, upon demand by any Liquidity Bank (with a
copy of such demand to the Liquidity Agent), pay to the Liquidity Agent for the
account of such Liquidity Bank any amounts required to compensate such Liquidity
Bank for any additional losses, costs, or expenses which it may reasonably incur
as a result of such failure, payment, or Continuation or Conversion, including,
without limitation, any loss (including those of anticipated profits, net of
anticipated profits in respect of the reemployment of such funds in the manner
determined by such Liquidity Bank), cost or expense incurred by reason of the
liquidation or reemployment of deposits or other funds acquired by any Liquidity
Bank to fund or maintain such Advance.
SECTION VIII.5 Binding Effect; Termination. This Agreement shall become
effective upon the Effective Date and shall thereafter be binding upon and inure
to the benefit of each of the Liquidity Borrower, the Low Floater Holders, the
Liquidity Agent, and the Liquidity Banks and each of their respective successors
and permitted assigns, except that the Liquidity Borrower shall not have the
right to assign its rights hereunder or any interest herein without the prior
written consent of the Liquidity Banks. In addition, the provisions of this
Agreement which, by their terms, are intended for the benefit of the Surety
Provider and the Liquidity Collateral Agent, respectively, shall inure to the
benefit of the Surety Provider and the Liquidity Collateral Agent, respectively,
and their successors and assigns. This Agreement shall terminate on the date
following the Liquidity Commitment Termination Date on which the Liquidity
Obligations shall have been paid in full. The Liquidity Borrower shall notify
S&P and Xxxxx'x of such termination.
SECTION VIII.6 Assignments and Participation.
-42-
(a) Each Liquidity Bank may upon advance notice of at least
thirty days (or such lesser notice as may be agreed to by the Liquidity Agent
and the Surety Provider, but in no event shall such notice be less than fourteen
calendar days), in a form substantially similar to Exhibit G, to the Liquidity
Agent, the Tender Agent, the Liquidity Borrower, the Surety Provider, the
Remarketing Agent, S&P, and Xxxxx'x, and after consultation with the Liquidity
Agent, assign to one or more banks or other entities all or a portion of its
rights and obligations under this Agreement (including, without limitation, all
or a portion of its Liquidity Commitment and the Advances owing to it);
provided, however, that (i) each such assignment shall be of a constant, and not
a varying, percentage of all of the assigning Liquidity Bank's rights and
obligations under this Agreement, (ii) the amount of the Liquidity Commitment of
the assigning Liquidity Bank being assigned pursuant to each such assignment
(determined as of the date of the Assignment and Acceptance with respect to such
assignment) shall in no event be less than the lesser of (A) $5,000,000 or an
integral multiple of $5,000,000 in excess of that amount and (B) the full amount
of the assigning Liquidity Bank's Liquidity Commitment, (iii) each such
assignment shall be to an Eligible Assignee, (iv) the parties to each such
assignment shall execute and deliver to the Liquidity Agent, for its acceptance
and recording in the Register, an Assignment and Acceptance, together with a
processing and recordation fee of $2,500 or such lesser amount as shall be
approved by the Liquidity Agent (which fee shall include the cost of the
issuance of new notes), (v) solely to the extent required by the Liquidity
Borrower, the Liquidity Agent, S&P or Xxxxx'x, counsel to the assignee shall
deliver an opinion in the form of Exhibit H to the Liquidity Borrower, the
Liquidity Agent, S&P and Xxxxx'x, (vi) in the case of any partial assignment,
the amount of the Liquidity Commitment being retained by the assigning Liquidity
Bank shall in no event be less than $5,000,000 and (vii) no such assignment
shall be effective until S&P and Xxxxx'x confirm that such assignment would not
cause the ratings assigned to the Low Floater Certificates prior to such
assignment to be reduced or withdrawn. Upon receipt of such notice of
assignment, the Liquidity Agent shall notify the Surety Provider, the Liquidity
Borrower and the assigning Liquidity Bank of the number of Liquidity Banks that
would be parties to this Agreement after giving effect to such Liquidity Bank's
intended assignment. Upon such execution, delivery, acceptance, and recording by
the Liquidity Agent, from and after the effective date specified in each
Assignment and Acceptance, which effective date shall be at least five Business
Days after the execution thereof (unless otherwise agreed by the Liquidity
Agent, the Liquidity Borrower and the Surety Provider), (i) the assignee
thereunder shall be a party hereto and, to the extent that rights and
obligations hereunder have been assigned to it pursuant to such Assignment and
Acceptance, have the rights and obligations of a Liquidity Bank hereunder and
(ii) the Liquidity Bank assignor thereunder shall, to the extent that rights and
obligations hereunder have been assigned by it pursuant to such Assignment and
Acceptance, relinquish its rights and be released from its obligations under
this Agreement (and, in the case of an Assignment and Acceptance covering all or
the remaining portion of an assigning Liquidity Bank's rights and obligations
under this Agreement, such Liquidity Bank shall cease to be a party hereto).
(b) By executing and delivering an Assignment and Acceptance,
the Liquidity Bank assignor thereunder and the assignee thereunder confirm to
and agree with each other and the other parties hereto as follows: (i) other
than as provided in such Assignment and
-43-
Acceptance, such assigning Liquidity Bank makes no representation or warranty
and assumes no responsibility with respect to any statements, warranties, or
representations made in or in connection with this Agreement or the execution,
legality, validity, enforceability, genuineness, sufficiency, or value of this
Agreement or any other instrument or document furnished pursuant hereto; (ii)
such assigning Liquidity Bank makes no representation or warranty and assumes no
responsibility with respect to the financial condition of the Liquidity Borrower
or the performance or observance by the Liquidity Borrower of any of its
obligations under this Agreement or any other instrument or document furnished
pursuant hereto; (iii) such assignee confirms that it has received a copy of
this Agreement, together with copies of such financial statements and other
documents and information as it has deemed appropriate to make its own credit
analysis and decision to enter into such Assignment and Acceptance; (iv) such
assignee will, independently and without reliance upon the Surety Provider, the
Liquidity Borrower, the Tender Agent, the Liquidity Agent, such assigning
Liquidity Bank or any other Liquidity Bank and based on such documents and
information as it shall deem appropriate at the time, continue to make its own
credit decisions in taking or not taking action under this Agreement; (v) such
assigning Liquidity Bank and such assignee confirm that such assignee is an
Eligible Assignee; (vi) such assignee appoints and authorizes the Liquidity
Agent to take such action as agent on its behalf and to exercise such powers
under this Agreement and under the Liquidity Pledge and Security Agreement, the
Insurance Agreement and each other Transaction Document as are delegated to the
Liquidity Agent by the terms hereof, together with such powers as are reasonably
incidental thereto; (vii) such assignee agrees that it will perform in
accordance with their terms all of the obligations which by the terms of this
Agreement are required to be performed by it as a Liquidity Bank and (viii) such
assignee agrees that it will comply with the provisions contained in Section
8.07 and Section 8.13 of this Agreement.
(c) The Liquidity Agent shall maintain at its address referred
to in Section 8.02 a copy of each Assignment and Acceptance and each Joinder
Agreement delivered to and accepted by it and a register for the recordation of
the names and addresses of the Liquidity Banks and the Liquidity Commitment of,
and principal amount of the Advances owing to, each Liquidity Bank from time to
time (the "Register"). The entries in the Register shall be conclusive and
binding for all purposes, absent manifest error, and the Liquidity Borrower, the
Liquidity Agent and the Liquidity Banks may treat each Person whose name is
recorded in the Register as a Liquidity Bank hereunder for all purposes of this
Agreement. The Register shall be available for inspection by the Liquidity
Borrower or any Liquidity Bank at any reasonable time and from time to time upon
reasonable prior notice.
(d) Subject to the provisions of Section 8.06(a), upon its
receipt of an Assignment and Acceptance executed by an assigning Liquidity Bank
and an Eligible Assignee, the Liquidity Agent shall, if such Assignment and
Acceptance has been completed and is in substantially the form of Exhibit A
hereto, (i) accept such Assignment and Acceptance, (ii) record the information
contained therein in the Register and (iii) give prompt notice thereof to the
Liquidity Borrower.
(e) Each Liquidity Bank may sell participations to one or more
banks or other entities ("Participants") in or to all or a portion of its rights
and obligations under this
-44-
Agreement (including, without limitation, all or a portion of its Liquidity
Commitment and the Advances owing to it); provided, however, that (i) such
Liquidity Bank's obligations under this Agreement (including, without
limitation, its Liquidity Commitment to the Liquidity Borrower hereunder) shall
remain unchanged, (ii) such Liquidity Bank shall remain solely responsible to
the other parties hereto for the performance of such obligations, (iii) the
Surety Provider, the Liquidity Borrower, the Liquidity Agent, and the other
Liquidity Banks shall continue to deal solely and directly with such Liquidity
Bank in connection with such Liquidity Bank's rights and obligations under this
Agreement and (iv) any Participant shall have been approved by the Liquidity
Borrower and the Surety Provider prior to the sale of a participation by such
Liquidity Bank, which approval shall not be unreasonably withheld by either the
Liquidity Borrower or the Surety Provider. Notwithstanding anything herein to
the contrary, each Participant shall have the rights of a Liquidity Bank
(including any right to receive payment) under Sections 2.11 and 2.14 and
8.04(b); provided, however, that the right of each Participant to receive
payment under such Sections shall not exceed the amounts that would have been
payable under such Sections by the Liquidity Borrower to the Liquidity Bank
granting its participation had such participation not been granted. No Liquidity
Bank granting a participation shall be entitled to receive payment under such
Sections in an amount which exceeds the sum of (i) the amount to which such
Liquidity Bank is entitled under such Sections with respect to the Liquidity
Obligations of the Liquidity Borrower owed to it which are not subject to any
participation, plus (ii) the aggregate amount to which its Participants are
entitled under such Sections with respect to the amounts of their respective
participations. Each Participant shall agree to comply with the provisions
contained in Section 8.07 and Section 8.13 of this Agreement.
(f) Each Liquidity Bank may, in connection with any assignment
or participation or proposed assignment or participation pursuant to this
Section 8.06, disclose to the assignee or participant or proposed assignee or
participant any information relating to the Liquidity Borrower or any other
Person furnished to such Liquidity Bank in connection with this Agreement by or
on behalf of the Liquidity Borrower; provided that, unless an Event of Default
or Liquidity Event of Default shall have occurred and be continuing, and so long
as the Liquidity Agent's review is prompt and its consent is not unreasonably
withheld, any such disclosure shall have been reviewed and approved by the
Liquidity Agent prior to such disclosure.
(g) In the event that (i) any Liquidity Bank ceases to have a
short-term unsecured indebtedness rating of at least A-1 by S&P and P-1 by
Xxxxx'x, (ii) any Liquidity Bank shall fail to meet its obligations under its
Liquidity Commitment, (iii) any Liquidity Bank has requested payment of costs
under Section 2.11 or 2.14, or (iv) any Liquidity Bank shall elect not to renew
its Liquidity Commitment under Section 8.10, such Liquidity Bank shall, promptly
following identification by the Surety Provider of an Eligible Assignee willing
to accept such assignment, assign its outstanding Advances and its Liquidity
Commitment hereunder to such Eligible Assignee in exchange for payment of all
principal of, and interest on, such Liquidity Bank's Advances, together with the
accrued and unpaid Commitment Fees owing to such Liquidity Bank; provided that
such payment shall not prejudice any other Liquidity Obligations owing to such
Liquidity Bank. The Surety Provider agrees to use commercially reasonable
efforts to find such a replacement Eligible Assignee within 30 days of the
occurrence of any of the events described in clauses (i), (ii) or (iii) above
and within 15 days of the occurrence of an
-45-
event described in clause (iv) above. The rights granted under this Section
8.06(g) are in addition to any rights of the Liquidity Borrower under Section
2.17 hereof.
(h) Prior to any financial institution becoming a Liquidity
Bank hereunder (other than an original signatory to this Agreement or a
participant thereof), S&P and Xxxxx'x shall have confirmed that such financial
institution's becoming a Liquidity Bank shall not cause the ratings assigned to
the Low Floater Certificates prior thereto to be reduced or withdrawn.
SECTION VIII.7 No Proceedings. The Liquidity Banks and the Liquidity
Agent each hereby agrees (which agreement shall, pursuant to the terms of this
Agreement, be binding upon its successors, assigns and Participants) that it
shall not institute against, or join any other Person in instituting against,
the Liquidity Borrower any bankruptcy, reorganization, arrangement, insolvency,
or liquidation proceeding, or other proceeding under any federal or state
bankruptcy or similar law, for one year and a day after the latest maturing Low
Floater Certificates or other rated indebtedness issued by the Liquidity
Borrower is paid in full and in cash. The provisions of this Section 8.07 shall
survive the termination of this Agreement.
SECTION VIII.8 No Recourse. Anything contained in this Agreement or any
other Transaction Document to the contrary notwithstanding, all payments to be
made by the Liquidity Borrower under this Agreement shall be made by the
Liquidity Borrower solely from available cash, which shall be limited to (a) the
proceeds of collections and other amounts payable by or on behalf of the Owner
Trust or the Administrative Agent to the Liquidity Borrower pursuant to the
terms of the Senior Certificates or any of the other Transaction Documents, and
(b) amounts paid to the Liquidity Collateral Agent pursuant to the terms of the
Liquidity Pledge and Security Agreement, (c) the proceeds of the remarketing of
Low Floater Certificates held by the Liquidity Provider, and (d) proceeds of the
Surety Bonds (collectively, "Available Funds"). No recourse shall be had against
the Liquidity Borrower personally or against any incorporator, officer, trustee,
director or employee of the Liquidity Borrower, or against any Low Floater
Holder, or any shareholder, trustee, director, officer, employee or agent,
whether past, present or future, of a Low Floater Holder, with respect to any of
the covenants, agreements, representations or warranties of the Liquidity
Borrower contained in this Agreement, or any other Transaction Document, it
being understood that such covenants, representations or warranties are
enforceable only to the extent of Available Funds. The provisions of this
Section 8.08 shall survive the termination of this Agreement. The Liquidity
Agent and each Liquidity Bank hereby acknowledge that, pursuant to the terms and
conditions of this Agreement and the other Transaction Documents, the Liquidity
Borrower and the Owner Trust are or may be required, from time to time, to make
certain payments to the Liquidity Agent or the Liquidity Banks, either as
compensation for services rendered, reimbursement for out of pocket expenses,
indemnification, or otherwise, as set forth herein and therein. The Liquidity
Agent and each Liquidity Bank hereby agree that, notwithstanding any provision
of any Transaction Document, (i) the Liquidity Borrower shall not make any such
payment to the Liquidity Agent or any Liquidity Bank, (ii) the Liquidity
Borrower shall have no duty, liability or obligation to make any such payment to
the Liquidity Agent or any Liquidity Bank, (iii) no such payment shall be due
from the Liquidity Borrower and (iv) neither the Liquidity Agent nor any
Liquidity Bank shall
-46-
have any right to enforce any claim against the Liquidity Borrower in respect of
any such payment, in each case at any time that any Low Floater Certificate is
outstanding and no Bankruptcy Event (as defined below) has occurred and is
continuing; provided, however, that, notwithstanding the foregoing, such payment
shall be made if and to the extent that (x) the making of such payment by the
Liquidity Borrower would not render the Liquidity Borrower insolvent and (y) the
Liquidity Borrower has received funds with respect to such obligations which may
be used to make such payment and which funds are not required to pay Low Floater
Certificates of the Liquidity Borrower when due; provided, further, that the
foregoing shall not be construed to prohibit a drawing on the Liquidity Surety
Bond by the Liquidity Agent. As used in this Section the term "Bankruptcy Event"
shall mean the entry against the Liquidity Borrower of a decree or order by a
court or agency or supervisory authority having jurisdiction in the premises for
the appointment of a trustee, conservator, receiver or liquidator in any
insolvency, readjustment of debt, marshaling of assets and liabilities or
similar proceedings, or for the winding up or liquidation of its affairs, or the
institution of any proceeding against the Liquidity Borrower seeking any of the
foregoing, and the continuance of any such decree or order, or any such
proceeding, in each case unstayed and in effect for a period of 60 consecutive
days, or the consent by the Liquidity Borrower to the appointment of a trustee,
conservator, receiver or liquidator in any insolvency, readjustment of debt,
marshaling of assets and liabilities or similar proceedings of or relating to
the Liquidity Borrower, or the filing by the Liquidity Borrower of a petition
seeking to adjudicate it a bankrupt or insolvent, or seeking liquidation,
winding up, reorganization or relief of debtors or seeking the entry of any
order for relief or the appointment of a trustee, conservator, receiver or
liquidator in any insolvency, readjustment of debt, marshaling of assets and
liabilities or similar proceedings, or for the winding up or liquidation of its
affairs.
SECTION VIII.9 Execution and Performance of Liquidity Pledge and
Security Agreement and Insurance Agreement. Without limitation to any provision
of Article VII, each Liquidity Bank hereby (a) authorizes the Liquidity Agent to
execute and deliver the Insurance Agreement on its behalf and agrees that such
execution by the Liquidity Agent shall be binding upon such Liquidity Bank and
its successors and assigns, (b) authorizes and directs the Liquidity Agent to
comply with the terms and provisions thereof on behalf of the Liquidity Banks
and (c) authorizes the Liquidity Agent, as the Liquidity Collateral Agent, to
execute and deliver the Liquidity Pledge and Security Agreement on its behalf
and agrees that such execution by the Liquidity Collateral Agent shall be
binding upon such Liquidity Bank and its successors and assigns.
SECTION VIII.10 Termination and Recommitment. At least 60 days but not
more than 120 days prior to the Scheduled Liquidity Commitment Termination Date,
the Surety Provider shall deliver written notice to the Liquidity Agent, which
shall request that each Liquidity Bank send a notice within 30 days in the form
of Exhibit I hereto (each, a "Notice of Recommitment") to the Surety Provider,
the Liquidity Borrower and the Tender Agent as to whether or not such Liquidity
Bank elects, in the exercise of its sole discretion, and based upon its
individual credit analysis at such time, to extend its Liquidity Commitment for
an additional 364 days following the then effective Scheduled Liquidity
Commitment Termination Date. If a Liquidity Bank does not desire to so recommit
and extend its Liquidity Commitment, or fails to
-47-
give a Notice of Recommitment within the 30-day period (such a Liquidity Bank, a
"Non-recommitting Liquidity Bank"), the Liquidity Commitment of such Liquidity
Bank shall expire as of the close of business on the then effective Scheduled
Liquidity Commitment Termination Date; otherwise, the Scheduled Liquidity
Commitment Termination Date of such Liquidity Bank shall expire as of the close
of business on the date of the new Scheduled Liquidity Commitment Termination
Date specified by such Liquidity Bank in its Notice of Recommitment.
SECTION VIII.11 Confidentiality. Unless otherwise required by
applicable law, order of any court or administrative agency, or otherwise by any
governmental authority, each of the Liquidity Banks and the Liquidity Agent
agrees to maintain the confidentiality, in its communications with third parties
and otherwise, of any information regarding the Liquidity Borrower, the
Transaction Documents or the transactions contemplated thereby which is obtained
in connection with this Agreement and which has been identified by the Liquidity
Borrower as confidential in nature (which identification, if relating to
information solely with respect to the Liquidity Borrower, and not otherwise
with respect to the Transaction Documents or the transactions contemplated
thereby, shall be in writing) (the "Confidential Material"); provided, however,
that the Confidential Material may be disclosed to third parties to the extent
such disclosure is (i) required in connection with the exercise of any remedy
hereunder or under any related documents, instruments and agreements, (ii) to
any actual or proposed participant or assignee of all or part of its rights
hereunder, or an actual or proposed liquidity or enhancement provider, in each
case which has agreed in writing to be bound by the provisions of this Section,
(iii) to any other Liquidity Bank or (iv) to any governmental authority
regulating a Liquidity Bank, made in compliance with any guideline or request
from such governmental authority (whether or not having the force of law);
provided further, however, that (x) the Agreement may be disclosed to the
Liquidity Banks' and the Liquidity Agent's respective legal counsel and
independent auditors to the extent they have agreed to be bound by the terms of
this Section 8.11, and (y) neither the Liquidity Banks nor the Liquidity Agent
shall have any obligation of confidentiality in respect of any information which
may be generally available to the public or becomes available to the public
through no fault of such Person.
SECTION VIII.12 GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.
SECTION VIII.13 CONSENT TO JURISDICTION; WAIVER OF JURY TRIAL. THE
PARTIES HERETO HEREBY IRREVOCABLY SUBMIT TO THE NONEXCLUSIVE JURISDICTION OF THE
UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK AND ANY COURT
IN THE STATE OF NEW YORK LOCATED IN THE CITY AND COUNTY OF NEW YORK, AND ANY
APPELLATE COURT FROM ANY THEREOF, IN ANY ACTION, SUIT OR PROCEEDING BROUGHT
AGAINST IT AND TO OR IN CONNECTION WITH ANY OF THE TRANSACTION DOCUMENTS OR THE
TRANSACTIONS CONTEMPLATED THEREUNDER OR FOR RECOGNITION OR ENFORCEMENT OF ANY
JUDGMENT, AND THE PARTIES HERETO HEREBY IRREVOCABLY AND UNCONDITIONALLY AGREE
THAT ALL CLAIMS IN RESPECT OF ANY SUCH ACTION OR PROCEEDING MAY BE HEARD OR
-48-
DETERMINED IN SUCH NEW YORK STATE COURT OR, TO THE EXTENT PERMITTED BY LAW, IN
SUCH FEDERAL COURT. THE PARTIES HERETO AGREE THAT A FINAL JUDGMENT IN ANY SUCH
ACTION, SUIT OR PROCEEDING SHALL BE CONCLUSIVE AND MAY BE ENFORCED IN OTHER
JURISDICTIONS BY SUIT ON THE JUDGMENT OR IN ANY OTHER MANNER PROVIDED BY LAW. TO
THE EXTENT PERMITTED BY APPLICABLE LAW, THE PARTIES HERETO HEREBY WAIVE AND
AGREE NOT TO ASSERT BY WAY OF MOTION, AS A DEFENSE OR OTHERWISE IN ANY SUCH
SUIT, ACTION OR PROCEEDING, ANY CLAIM THAT THE SUIT, ACTION OR PROCEEDING IS
BROUGHT IN AN INCONVENIENT FORUM OR THAT THE VENUE OF THE SUIT, ACTION OR
PROCEEDING IS IMPROPER. EACH PARTY HERETO HEREBY IRREVOCABLY WAIVES ALL RIGHTS
TO TRIAL BY JURY IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS
LIQUIDITY AGREEMENT OR ANY TRANSACTION CONTEMPLATED HEREBY AND FOR ANY
COUNTERCLAIM THEREIN.
SECTION VIII.14 Counterparts. This Agreement may be executed in any
number of separate counterparts by the parties hereto and each counterpart when
so executed shall be deemed to be an original and all such counterparts when
taken together shall constitute one and the same agreement.
SECTION VIII.15 Captions. The various captions (including, without
limitation, the table of contents) in this Agreement are provided solely for
convenience of reference and shall not affect the meaning or interpretation of
any provision of this Agreement.
SECITON VIII.16 Severability. If any provision of this Agreement shall
be prohibited or invalid under applicable law, it shall be ineffective only to
such extent, without invalidating the remainder of this Agreement.
SECITON VIII.17 Notice of Limitation of Liability. Pursuant to Section
10.6 of the Origination Trust Agreement, all Persons with whom the Origination
Trust does business are on notice that the Shareholders, the Trustees, and the
Manager (each as defined in the Origination Trust Agreement) are not liable for
the Origination Trust's obligations, and all persons shall look solely to the
assets of the Origination Trust for payment. The Origination Trust is a business
trust created under the Trust Act; but the Board of Trustees or Manager shall
not be liable for failure to give notice to such Persons, and any failure to
give such notice shall not imply that the Shareholders, the Managing Trustees,
the Manager, and the Registered Trustee are liable for the Trust's obligations.
[Signature pages to follow]
-49-
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their respective officers thereunto duly authorized, as of the date
first above written.
OWNER TRUST: CHARTER MAC OWNER TRUST I
By: RELATED CHARTER LP, its Manager
By: RELATED CHARTER LLC, its General Partner
By: /s/ Xxxxxx X. Xxxxxx
----------------------------------
Name: Xxxxxx X. Xxxxxx
Title:President & COO
LIQUIDITY BORROWER: CHARTER
TRUST I
By: FIRST TENNESSEE BANK NATIONAL ASSOCIATION,
as Certificate Trust Agent, pursuant to the
Certificate Issuer Trust Agreement, of the
CHARTER MAC FLOATER CERTIFICATE TRUST I
By: /s/ Xxxxxx Xxxxxxxxx
----------------------------------
Name: Xxxxxx Xxxxxxxxx
Title:
TENDER AGENT: FIRST TENNESSEE BANK NATIONAL ASSOCIATION
By: /s/ Xxxxxx Xxxxxxxxx
----------------------------------
Name: Xxxxxx Xxxxxxxxx
Title:
LIQUIDITY AGENT: BAYERISCHE LANDESBANK GIROZENTRALE,
NEW YORK BRANCH
By: /s/ Xxxxx X. Xxxxxxx
----------------------------------
Name: Xxxxx X. Xxxxxxx
Title: Vice President
By:
----------------------------------
Name:
Title:
LIQUIDITY BANK: BAYERISCHE LANDESBANK GIROZENTRALE,
NEW YORK BRANCH
By:
----------------------------------
Name:
Title:
By:
----------------------------------
Name:
Title:
LIQUIDITY BANK: COMMERZBANK AG, NEW YORK BRANCH
By: /s/ Xxxxxx Xxxxxxx
----------------------------------
Name: Xxxxxx Xxxxxxx
Title: Vice President
By:
----------------------------------
Name:
Title:
LIQUIDITY BANK: CREDIT COMMUNAL DE BELGIQUE S.A.,
NEW YORK BRANCH
By: /s/ Xxxxxxxx Xxx Xxxxxxx
----------------------------------
Name: Xxxxxxxx Xxx Xxxxxxx
Title: Vice President
By:
----------------------------------
Name:
Title:
LIQUIDITY BANK: LANDESBANK HESSEN-THURINGEN GIROZENTRALE,
NEW YORK BRANCH
By: /s/ Xxxxxxx Xxxxx
----------------------------------
Name: Xxxxxxx Xxxxx
Title: Assistant Vice President
By:
----------------------------------
Name:
Title:
SURETY PROVIDER: MBIA INSURANCE CORPORATION
By: /s/ Xxxxxx X. Xxxxx
----------------------------------
Name: Xxxxxx X. Xxxxx
Title: Director
SCHEDULE I
Commitments and Applicable Lending Offices
Name of Liquidity Bank Commitment
---------------------- ----------
BAYERISCHE LANDESBANK $50,575,343
GIROZENTRALE, XXX XXXX XXXXXX
XXXXXXXXXXX XX, XXX XXXX BRANCH $50,575,343
CREDIT COMMUNAL DE BELGIQUE S.A., $27,816,439
NEW YORK BRANCH
LANDESBANK HESSEN-THURINGEN $22,758,905
GIROZENTRALE, NEW YORK BRANCH
Base Rate
Lending Office
--------------
Same as notice address
Eurodollar Rate
Lending Office
--------------
Same as notice address
------------
Total Commitment $151,726,030
============
SCHEDULE II
CONDITIONS PRECEDENT DOCUMENTS
1. Certificate of the Registered Trustee of the Liquidity
Borrower, with attached organizational documents, by-laws and
resolutions.
2. Opinion of Liquidity Borrower's Counsel.
3. A copy of each of the Transaction Documents contemplated to be
delivered on or prior to the Effective Date, duly executed and
delivered by the parties thereto, including, without
limitation, the Liquidity Pledge and Security Agreement and
the Surety Bonds.
4. UCC-1 financing statements pursuant to the Liquidity Pledge
and Security Agreement by the Liquidity Collateral Agent
against the Liquidity Borrower.
5. Officer's Certificate of duly elected officer of the Servicer
to the effect that all representations and warranties of
Liquidity Borrower set forth in the Certificate Issuer Trust
Agreement are true as of the Effective Date.
6. Opinion of Counsel to the Surety Provider.
7. Certificates of legal existence and good standing for the
Liquidity Borrower.
SCHEDULE III
NOTICE ADDRESSES
OWNER TRUST: CHARTER MAC OWNER TRUST I
c/o Related Charter LP
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: President
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
and: Attention: Xxxxx Xxxxx,
Senior Vice President
LIQUIDITY BORROWER: CHARTER MAC FLOATER CERTIFICATE TRUST I
c/o Related Charter LP
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: President
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
and: Attention: Xxxxx Xxxxx,
Senior Vice President
TENDER AGENT: FIRST TENNESSEE BANK
NATIONAL ASSOCIATION
First Tennessee Bank National Association
0000 Xxxxxx Xxxxxx
Xxxxxxx, Xxxxxxxxx 00000
Attention: Xxxxxx Xxxxxxxxx
Tel: 000-000-0000
Fax: 000-000-0000
LIQUIDITY AGENT BAYERISCHE LANDESBANK GIROZENTRALE,
and LIQUIDITY BANK: NEW YORK BRANCH
000 Xxxxxxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxx X. Xxxxxxx
(for Credit matters)
First Vice President
Manager of Public Finance
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
and to:
Loan Administration
Xx. Xxxxxxxx Xxxxxxx (Operations contact)
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
LIQUIDITY BANK: COMMERZBANK AG, NEW YORK
2 World Xxxxxxxxx Xxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Operations/Administration
(including draws)
Attention: Xxxxxxxxx Xxxxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
CREDIT (amendments/extensions)
Attention: Xxxxxx Xxxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
and to:
LIQUIDITY BANK: CREDIT COMMUNAL DE BELGIQUE S.A.,
NEW YORK BRANCH
Chrysler Building, 54th floor
New York , New York 10174
Attention: Xxxxxxxx Xxx Xxxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
LIQUIDITY BANK: LANDESBANK HESSEN-THURINGEN
GIROZENTRALE, NEW YORK BRANCH
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
-2-
Attention: Xxxx Xxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
SURETY PROVIDER: MBIA INSURANCE CORPORATION
000 Xxxx Xxxxxx
Xxxxxx, Xxx Xxxx 00000
Attention: Vice President and Manager,
IPM Structured Finance
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
-3-
EXHIBIT A
FORM OF
ASSIGNMENT AND ACCEPTANCE
Reference is made to the Liquidity Agreement dated as of May 21, 1998
(the "Agreement") among CHARTER MAC OWNER TRUST I, a Delaware business trust
(the "Owner Trust"), CHARTER MAC FLOATER CERTIFICATE TRUST I, a Delaware
business trust (the "Liquidity Borrower"), FIRST TENNESSEE BANK NATIONAL
ASSOCIATION, (the "Tender Agent"), the Liquidity Banks (as defined in the
Agreement), BAYERISCHE LANDESBANK GIROZENTRALE, NEW YORK BRANCH, as the
Liquidity Agent for the Liquidity Banks (the "Liquidity Agent") and MBIA
INSURANCE CORPORATION, (the "Surety Provider"). Terms defined in the Agreement
are used herein with the same meaning.
_______________ (the "Assignor") and _________________ (the "Assignee")
agree as follows:
1. The Assignor hereby sells and assigns to the Assignee, and the
Assignee hereby purchases and assumes from the Assignor, that interest in and to
all of the Assignor's rights and obligations under the Agreement as of the
Transfer Date (as defined in Section 4 hereof) which represents the percentage
interest specified in Section 1 of Schedule I hereto of all outstanding rights
and obligations under the Agreement, including, without limitation, such
interest in the Assignor's Liquidity Commitment and the Advances owing to the
Assignor. After giving effect to such sale and assignment, the Assignee's
Liquidity Commitment and the amount of the Advances owing to the Assignee will
be as set forth in Section 2 of Schedule I hereto.
2. The Assignor (i) represents and warrants that it is the legal and
beneficial owner of the interest being assigned by it hereunder and that such
interest is free and clear of any adverse claim; (ii) makes no representation or
warranty and assumes no responsibility with respect to any statements,
warranties or representations made in or in connection with the Agreement, any
other Transaction Document or the execution, legality, validity, enforceability,
genuineness, sufficiency, or value of the Agreement or any other instrument or
document furnished pursuant thereto; and (iii) makes no representation or
warranty and assumes no responsibility with respect to the financial condition
of the Liquidity Borrower or the performance or observance by the Liquidity
Borrower of any of its obligations under the Agreement, any other Transaction
Document or any other instrument or document furnished pursuant thereto.
3. The Assignee (i) confirms that it has received a copy of the
Agreement, together with copies of such financial statements and such other
documents and information as it has deemed appropriate to make its own credit
analysis and decision to enter into this Assignment and Acceptance; (ii) agrees
that it will, independently and without reliance upon the Liquidity Agent, the
Assignor or any other Liquidity Bank and based on such documents and information
as it shall deem appropriate at the time, continue to make its own credit
decisions in taking or not taking action under the Agreement; (iii) confirms
that it is an Eligible Assignee; (iv) appoints and authorizes the Liquidity
Agent and the Liquidity Collateral Agent to take such action as agent on its
behalf and to exercise such powers under the Agreement and the other Transaction
Documents as are delegated to the Liquidity Agent and the Liquidity Collateral
Agent, respectively, by the terms thereof, together with such powers as are
reasonably incidental thereto; (v) agrees that it will perform in accordance
with their terms all of the obligations which by the terms of the Agreement are
required to be performed by it as a Liquidity Bank; (vi) specifies as its
Applicable Lending Offices and address for notices the offices set forth beneath
its name on Schedule I and Schedule III hereof [and] (vii) attaches the forms,
certificates or statements required by Section 2.14(e) of the Agreement [and
(viii) confirms that it is authorized to enter into this Assignment and
Acceptance].(1)
4. Following the execution of this Assignment and Acceptance by the
Assignor and the Assignee, it will be delivered to the Liquidity Agent for
acceptance and recording by the Liquidity Agent. The effective date of this
Assignment and Acceptance (the "Transfer Date") shall be the date of acceptance
thereof by the Liquidity Agent unless a later date is specified in Section 3 of
Schedule I.
5. Upon such acceptance and recording by the Liquidity Agent, as of the
Transfer Date, (i) the Assignee shall be a party to the Agreement and, to the
extent provided in this Assignment and Acceptance, have the rights and
obligations of a Liquidity Bank thereunder including its obligation to comply
with the provisions contained in Section 8.07 and Section 8.13 of the Agreement
and (ii) the Assignor shall, to the extent provided in this Assignment and
Acceptance, relinquish its rights and be released from its obligations under the
Agreement.
6. Upon such acceptance and recording by the Liquidity Agent, from and
after the Transfer Date, the Liquidity Agent shall make all payments under the
Agreement in respect of the interest assigned hereby (including, without
limitation, all payments of principal, interest, and fees hereunder with respect
thereto) to the Assignee. The Assignor and Assignee shall make all appropriate
adjustments in payments under the Agreement for periods prior to the Transfer
Date directly between themselves.
7. This Assignment and Acceptance shall be governed by, and construed
in
-------------
(1) To be included if the Assignee is not created or organized under the
laws of the United States or a political subdivision thereof.
-2-
accordance with, the laws of the State of New York.
IN WITNESS WHEREOF, the parties hereto have caused this
Assignment and Acceptance to be executed by their respective officers thereunto
duly authorized, as of the date first above written, such execution being made
on Schedule 1 hereto.
-3-
SCHEDULE I
TO
ASSIGNMENT AND ACCEPTANCE
DATED ______ __, ____
Section 1.
Percentage Interest: %
--------
Section 2.
Assignee's Liquidity Commitment: $
--------
Aggregate Outstanding Principal Amount of
Advances Owing to the Assignee: $
---------
Section 3.
Transfer Date: , 19
---------------- --
[Scheduled Liquidity Commitment
Termination Date
-------------------, ----](2)
[NAME OF ASSIGNOR]
By:
--------------------------
Title:
[NAME OF ASSIGNEE]
By:
--------------------------
Title:
Applicable Lending Officers
Eurodollar Rate Advances:
[Address]
Base Rate Advances:
[Address]
-----------------
(2) Insert if assignment relates to a non-renewing Liquidity Bank.
Address for notices
[Address]
ACCEPTED THIS DAY OF ,
BAYERISCHE LANDESBANK GIROZENTRALE,
NEW YORK BRANCH,
AS LIQUIDITY AGENT
By:_____________________
Title:
ACCEPTED THIS DAY OF ,
MBIA INSURANCE CORPORATION
By:_____________________
Title:
EXHIBIT B
FORM OF
JOINDER AGREEMENT
Reference is made to the Agreement dated as of May 21, 1998 (the
"Agreement") among CHARTER MAC OWNER TRUST I, a Delaware business trust (the
"Owner Trust"), CHARTER MAC FLOATER CERTIFICATE TRUST I, a Delaware business
trust (the "Liquidity Borrower"), FIRST TENNESSEE BANK NATIONAL ASSOCIATION,
(the "Tender Agent"), the Liquidity Banks (as defined in the Agreement),
BAYERISCHE LANDESBANK GIROZENTRALE, NEW YORK BRANCH, the Liquidity Agent for the
Liquidity Banks (the "Liquidity Agent") and MBIA INSURANCE CORPORATION, (the
"Surety Provider"). Terms defined in the Agreement are used herein with the same
meaning.
_______________ (the "New Liquidity Bank") and the Liquidity Borrower
agree as follows:
1. Pursuant to Section 2.04(c) of the Agreement, the Liquidity Borrower
has requested that the New Liquidity Bank agree to become a "Liquidity Bank"
under the Agreement.
2. The effective date of this Joinder Agreement is (the "Effective
Date"), which is at least one Business Day after the execution hereof.
3. By executing and delivering this Joinder Agreement, the New
Liquidity Bank confirms to and agrees with each other party to the Agreements
that (i) it has received a copy of the Agreement, together with copies of such
financial statements and such other documents and information as it has deemed
appropriate to make its own credit analysis and decision to enter into this
Joinder Agreement; (ii) agrees that it will, independently and without reliance
upon the Liquidity Agent or any other Liquidity Bank and based on such documents
and information as it shall deem appropriate at the time, continue to make its
own credit decisions in taking or not taking action under the Agreement; (iii)
confirms that it is an Eligible Assignee; (iv) appoints and authorizes the
Liquidity Agent and the Liquidity Collateral Agent to take such action as agent
on its behalf and to exercise such powers under the Agreement and the other
Transaction Documents as are delegated to the Liquidity Agent and the Liquidity
Collateral Agent, respectively, by the terms thereof, together with such powers
as are reasonably incidental thereto; (v) agrees that it will perform in
accordance with its terms all of the obligations which by the terms of the
Agreement are required to be performed by it as a Liquidity Bank; (vi) specifies
as its Applicable Lending Offices and address for notices the offices set forth
beneath its name on the signature page hereof, (vii) attaches the forms,
certificates or statements required by Section 2.14(e) of the Agreement and
(viii) confirms that it is duly authorized to enter into this Joinder Agreement.
4. On the Effective Date of this Joinder Agreement, the New Liquidity
Bank shall join in and be a party to each Agreement and, to the extent provided
in this Joinder Agreement, have the rights and obligations of a Liquidity Bank
under each such Agreement including its obligation to comply with the provisions
contained in Section 8.07 and Section 8.13 of the Agreement.
5. This Joinder Agreement shall be governed by, and construed in
accordance with, the laws of the State of New York.
IN WITNESS WHEREOF, the parties hereto have caused this Joinder
Agreement to be executed by their respective officers thereunto duly authorized,
as of the date first above written, such execution being made on Schedule I
hereto.
-2-
SCHEDULE I
TO
JOINDER AGREEMENT
DATED ______ __, ____
Section 1.
Percentage Interest: %
-----
Section 2.
New Liquidity Bank's Liquidity Commitment: $
------
NEW LIQUIDITY BANK: [NAME OF NEW LIQUIDITY BANK]
By: _________________________
Title:
Applicable Lending Officers
Eurodollar Rate Advances:
[Address]
Base Rate Advances:
[Address]
Address for notices
[Address]
APPROVED THIS DAY OF ___________, ____
CHARTER MAC FLOATER CERTIFICATE TRUST I
By: FIRST TENNESSEE BANK NATIONAL ASSOCIATION,
as Certificate Trust Agent, pursuant to the Certificate Issuer
Trust Agreement, of the CHARTER MAC FLOATER
CERTIFICATE TRUST I
By:________________________________
Name:
Title:
By:________________________________
Name:
Title:
APPROVED THIS DAY OF __________, ____
MBIA INSURANCE CORPORATION
By:________________________________
Name:
Title:
-2-
EXHIBIT C
FORM OF NOTICE OF LIQUIDITY BORROWING
[Date]
To: BAYERISCHE LANDESBANK GIROZENTRALE, NEW YORK BRANCH
as the Liquidity Agent for the
Liquidity Banks party to the
Agreement referred to
below
Attention:
---------
Ladies and Gentlemen:
The undersigned, [Tender Agent], as Tender Agent for the CHARTER MAC
FLOATER CERTIFICATE TRUST I (the "Liquidity Borrower"), refers to the Agreement,
dated as of May 21, 1998 (the "Agreement," the terms defined therein being used
herein as therein defined), among CHARTER MAC OWNER TRUST I (the "Owner Trust"),
the Liquidity Borrower, the Tender Agent, certain Liquidity Banks party thereto,
BAYERISCHE LANDESBANK GIROZENTRALE, NEW YORK BRANCH, as the Liquidity Agent for
said Liquidity Banks and MBIA INSURANCE CORPORATION (the "Surety Provider"),
hereby gives you notice, irrevocably, pursuant to Section 2.03 of the Agreement
that the undersigned hereby requests a Liquidity Borrowing in the form of a
[Funding Advance] [Downgraded Bank Advance] under the Agreement, and in that
connection sets forth below the information relating to such Liquidity Borrowing
(the "Proposed Funding Advance") [(the "Proposed Downgraded Bank Advance")] as
required by Section 2.03 of the Agreement:
(a) The Business Day of the [Proposed Funding Advance]
[Proposed Downgraded Bank Advance] is _______________, ____.
(b) The aggregate amount of the [Proposed Funding Advance]
[Proposed Downgraded Bank Advance] is $_________________.
(c) Liquidity Interest Period for [each Advance made as part
of the Proposed Funding Advance] [the Proposed Downgraded Bank Advance]
is [__ days] [__ month[s]].
(d) The Advances under such Proposed Funding Advance shall
constitute Base Rate Advances.
(e) The Advances shall constitute [Downgraded Bank Advances
from [identify Liquidity Bank(s) subject to a Downgrade Event]].
(f) Funds from the [proposed liquidity borrowing] [proposed
Advances] should be deposited in Acct. No. [ ], ABA No. [ ] at [ ].
Very truly yours,
FIRST TENNESSEE BANK NATIONAL
ASSOCIATION
as Tender Agent for
CHARTER MAC FLOATER CERTIFICATE TRUST I
By:_______________________
Name:
Title:
-2-
EXHIBIT D
FORM OF
LIQUIDITY COMMITMENT INCREASE
[date]
To the Liquidity Agent
under the Agreement
referred to below
Reference is made to the Agreement dated as of May 21, 1998 (the
"Agreement") among CHARTER MAC OWNER TRUST I (the "Owner Trust"), CHARTER MAC
FLOATER CERTIFICATE TRUST I, a Delaware business trust (the "Liquidity
Borrower"), FIRST TENNESSEE BANK NATIONAL ASSOCIATION (the "Tender Agent"), the
Liquidity Banks (as defined in the Agreement), BAYERISCHE LANDESBANK
GIROZENTRALE, NEW YORK BRANCH, as the Liquidity Agent for the Liquidity Banks
(the "Liquidity Agent"), and MBIA INSURANCE CORPORATION (the "Surety Provider").
Terms defined in the Agreement are used herein with the same meaning.
The undersigned Liquidity Borrower and [name of Liquidity Bank] (the
"Liquidity Bank") agree as follows:
1. The Liquidity Bank's Liquidity Commitment will be increased from
$__________ to $ ___________.
2. The effective date of such increase is ________, _______(the
"Effective Date"), which Effective Date is at least one Business day after the
date of this Liquidity Commitment Increase.
3. The Liquidity Bank shall endorse the increased amount of its
Liquidity Commitment on its Liquidity Note.
LIQUIDITY BANK: [NAME OF LIQUIDITY BANK]
By:_________________________
Name:
Title:
LIQUIDITY BORROWER: CHARTER MAC FLOATER CERTIFICATE
TRUST I
By: FIRST TENNESSEE BANK NATIONAL
ASSOCIATION, as Certificate
Trust Agent, pursuant to the
Certificate Issuer Trust
Agreement, of the CHARTER MAC
FLOATER CERTIFICATE TRUST I
By:_________________________
Name:
Title:
ACCEPTED THIS DAY OF ,
BAYERISCHE LANDESBANK GIROZENTRALE,
NEW YORK BRANCH,
AS LIQUIDITY AGENT
By:__________________________
Title:
APPROVED THIS DAY OF ,
MBIA INSURANCE CORPORATION
By:__________________________
Title:
-2-
EXHIBIT E
FORM OF NOTICE OF CONVERSION/CONTINUATION
[Date]
To: BAYERISCHE LANDESBANK GIROZENTRALE, NEW YORK BRANCH
as the Liquidity Agent for the
Liquidity Banks party to the
Agreement referred to
below
Attention:
---------
Ladies and Gentlemen:
The undersigned, CHARTER MAC FLOATER CERTIFICATE TRUST I (the
"Liquidity Borrower"), refers to the Agreement, dated as of May 21, 1998 (the
"Agreement," the terms defined therein being used herein as therein defined),
among CHARTER MAC OWNER TRUST I (the "Owner Trust"), the Liquidity Borrower, the
Tender Agent, certain Liquidity Banks party thereto, BAYERISCHE LANDESBANK
GIROZENTRALE, NEW YORK BRANCH, as the Liquidity Agent for said Liquidity Banks,
and MBIA INSURANCE CORPORATION (the "Surety Provider") hereby gives you notice,
irrevocably, pursuant to Section 2.08(b) of the Agreement that the undersigned,
on behalf of the Liquidity Borrower, hereby elects to insert one or more of the
following:
(1) convert $________ in aggregate principal amount of Base
Rate Advances with a current Liquidity Interest Period ending
__________ ___, 19__, to Eurodollar Rate Advances on __________________
___, 19__. The initial Liquidity Interest Period for such Eurodollar
Rate Advances is requested to be ___ month[s].
(2) continue as Eurodollar Rate Advances $__________ in
aggregate principal amount of Eurodollar Rate Advances ________________
with a current Liquidity Interest Period ending _________________,
19__. The succeeding Interest Period is requested to be _______
month[s].
--------------
(1) Use if converting Base Rate Advances to Eurodollar Rate Advances.
(2) Use if continuing Eurodollar Rate Advances as Eurodollar Rate Advances.
(3) continue as Base Rate Advances $____________ in aggregate
principal amount of Base Rate Advances with a current Liquidity
Interest Period ending _____, 19__. The succeeding Liquidity Interest
Period is requested to be _____ month[s].
Very truly yours,
CHARTER MAC FLOATER CERTIFICATE
TRUST I
By: FIRST TENNESSEE BANK NATIONAL
ASSOCIATION, as Certificate
Trust Agent, pursuant to the
Certificate Issuer Trust
Agreement, of the CHARTER MAC
FLOATER CERTIFICATE TRUST I
By:_________________________
Name:
Title:
---------------------
(3) Use if continuing base rate Advances as Base Rate Advances.
-2-
EXHIBIT F
FORM OF
LIQUIDITY NOTE
[Amount of Liquidity Commitment] [ ], 1998
----------
FOR VALUE RECEIVED, the undersigned, CHARTER MAC FLOATER CERTIFICATE
TRUST I, a Delaware business trust (the "Liquidity Borrower"), HEREBY
UNCONDITIONALLY PROMISES TO PAY to the order of [NAME OF LIQUIDITY BANK] (the
"Liquidity Bank"), the principal sum of [_________] DOLLARS ($[_________]), or,
if less, the aggregate unpaid principal amount of all of the Advances made by
the Liquidity Bank pursuant to the "Agreement" (as hereinafter defined).
Capitalized terms used herein and not otherwise defined herein are used as
defined in the Agreement.
The principal amount of the indebtedness evidenced hereby shall be
payable in the amounts and on the dates specified in the Agreement and, if not
sooner paid in full, on the Scheduled Liquidity Maturity Date. The Liquidity
Borrower further promises to pay interest on the unpaid principal amount of each
Advance from the date of such Loan until the principal amount thereof is paid in
full, at such interest rates, and payable at such times, as are specified in the
Agreement.
All payments of principal and interest in respect of this Liquidity
Note shall be made payable to the Liquidity Agent in lawful money of the United
States of America in same day funds for the Liquidity Bank's account at such
place as shall be designated in writing by the Liquidity Agent for such purpose
in accordance with the terms of the Agreement.
The Liquidity Bank may record the date, Type and amount of each Advance
made by it, each continuation thereof, each conversion of all or a portion
thereof to another Type, the date and amount of each payment or prepayment of
principal thereof and, in the case of Eurodollar Rate Advances, the length of
each Liquidity Interest Period with respect thereto, on the schedule that is
attached hereto and made a part hereof; provided, that the failure of the
Liquidity Bank to make any such recordation or endorsement or any error in any
such recordation or endorsement shall not affect the obligations of the
Liquidity Borrower hereunder or under the Agreement.
This Liquidity Note is one of the Liquidity Notes referred to in, and
is entitled to the benefits of, that certain Agreement dated as of May 21, 1998
(as amended, restated, supplemented or otherwise modified from time to time, the
"Agreement") among CHARTER MAC OWNER TRUST I (the "Owner Trust"), the Liquidity
Borrower, FIRST TENNESSEE BANK NATIONAL ASSOCIATION (the "Tender Agent"), the
Liquidity Agent, the Liquidity Banks and MBIA INSURANCE CORPORATION (the "Surety
Provider"). The Agreement, among other things, (i) provides for the making of
Advances by the Liquidity Banks to Liquidity
Borrower from time to time and (ii) contains provisions for the mandatory
prepayment of principal from time to time upon the happening of certain stated
events.
Demand, presentment, protest and notice of nonpayment and protest are
hereby waived by the Liquidity Borrower.
Whenever in this Liquidity Note reference is made to the Liquidity
Agent, the Liquidity Banks or the Liquidity Borrower, such reference shall be
deemed to include, as applicable, a reference to their respective successors and
assigns. The provisions of this Liquidity Note shall be binding upon and shall
inure to the benefit of said successors and assigns. The Liquidity Borrower's
successors and assigns shall include, without limitation, a receiver, trustee or
debtor in possession of or for the Liquidity Borrower.
-2-
THIS LIQUIDITY NOTE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE
WITH THE LAWS OF THE STATE OF NEW YORK.
IN WITNESS WHEREOF, the Liquidity Borrower has caused this Note to be
executed as of the date first above-written.
LIQUIDITY BORROWER: CHARTER MAC FLOATER CERTIFICATE
TRUST I
By: FIRST TENNESSEE BANK NATIONAL
ASSOCIATION, as Certificate
Trust Agent, pursuant to the
Certificate Issuer Trust
Agreement, of the CHARTER MAC
FLOATER CERTIFICATE TRUST I
By:_________________________
Name:
Title:
-3-
Charter MAC Floater Certificate Trust I Liquidity Note Schedule
Amount of Type of Notation - Interest Amount of Unpaid Principal
Date Advance Advance Made By Period Principal Repaid Balance
---- ------- --------------- ------ ---------------- -------
-4-
EXHIBIT G
FORM OF NOTICE OF ASSIGNMENT PURSUANT
TO SECTION 8.06 OF Agreement
[Letterhead of Assigning Liquidity Bank]
[Date]
To:
BAYERISCHE LANDESBANK GIROZENTRALE, NEW YORK BRANCH
[The Surety Provider]
[Moody's]
[S&P]
Pursuant to Section 8.06 of the Agreement, we hereby notify you that we
intend to make the following assignment:
Assignee: [name]
Amount Assigned: [$ amount]
Retained Amount: [$ amount]
Effective Date:
Very truly yours,
-5-
EXHIBIT H
FORM OF OPINION OF COUNSEL
FOR EACH LIQUIDITY BANK
DOMESTIC COUNSEL TO EACH LIQUIDITY BANK
[Letterhead of Counsel]
[DATE]
Charter MAC Floater Certificate Trust I
[ ]
[ ]
[ ]
[[Address of Liquidity Agent]]
Re: Agreement with Charter MAC Floater Certificate Trust I
Ladies and Gentlemen:
We have acted as counsel for the [Name of Subject Bank] (the "Subject
Bank") in connection with that certain Agreement dated as of May 1, 1998 (the
"Agreement") among Charter MAC Owner Trust I, Charter MAC Floater Certificate
Trust I (the "Liquidity Borrower"), First Tennessee Bank National Association as
Tender Agent, the Subject Bank and certain other banks from time to time parties
thereto (each, a "Liquidity Bank" and collectively, the "Liquidity Banks"),
[______________________] as Liquidity Agent for the Liquidity Banks and MBIA
Insurance Corporation. Terms defined therein and not otherwise defined in this
letter shall have the respective meanings ascribed therein.
Subject to the qualifications and limitations stated herein, we hereby
advise you that, in our opinion:
1. The Subject Bank is duly licensed and qualified to operate as a
[describe nature of institution--e.g., national banking association], and is in
good standing under the laws of the State of [_____________].
2. The Agreement has been duly authorized by all necessary corporate
action, has been duly executed and delivered by the Subject Bank and, assuming
due authorization, execution and delivery by each of the other parties thereto,
constitutes a legal, valid and binding
obligation of the Subject Bank, enforceable against the Subject Bank in
accordance with its terms.
3. No consent, authorization or approval of, and no notice or filing
with, any governmental administrative or other authority is required in
connection with the execution, delivery or performance of the Agreement by the
Subject Bank.
4. The Subject Bank has the corporate power and authority to execute,
deliver and perform the Agreement and the execution, delivery and performance of
the Agreement by the Subject Bank does not conflict with any law, rule or
regulation applicable to the Subject Bank.
Our opinion set forth in paragraph 2 above is subject to the
qualifications that the enforceability of the Subject Bank's obligations under
the Agreement may be limited by bankruptcy, insolvency, reorganization,
moratorium and other similar laws relating to or affecting creditors' rights
generally or by general equitable principles (regardless of whether such
enforceability is considered in a proceeding in equity or at law). Without in
any way limiting the foregoing, we express no opinion with respect to the
enforceability of the Subject Bank's commitment to make Advances to the
Liquidity Borrower under the Agreement after the commencement of any involuntary
bankruptcy case or other insolvency proceeding against the Liquidity Borrower.
[I am/We are admitted to practice in the State of ______ and do not
express any opinion herein concerning any other law other than the State of
_________ and the federal laws of the United States of America. I/We have
assumed, for purposes of this opinion, with your permission that the law of the
State of New York is in all relevant respects the same as the law of the State
of __________.]
The opinions expressed herein are solely for your benefit in connection
with the transactions contemplated by the Agreement and may not be relied on in
any manner or for any purpose by any other individual, partnership, corporation
or other entity ("Person"), nor any copies thereof published, communicated or
otherwise made available in whole or in part to any other Person without our
specific prior written consent; provided, however, that Standard & Poor's
Ratings Services (a division of The XxXxxx-Xxxx Companies, Inc.) and Xxxxx'x
Investors Service, Inc. may be given copies of this letter and shall be entitled
to rely on the opinions expressed herein to the same extent as if this letter
were addressed to them.
Respectfully submitted,
-2-
FOREIGN COUNSEL TO EACH FOREIGN LIQUIDITY BANK
[Letterhead of Counsel]
[DATE]
Charter MAC Floater Certificate Trust I
[ ]
[ ]
[ ]
[[Address of Liquidity Agent]]
Re: Agreement with Charter MAC Floater Certificate Trust I
Ladies and Gentlemen:
We have acted as counsel for the [Name of Subject Bank] (the "Subject
Bank") in connection with that certain Agreement dated as of May 1, 1998 (the
"Agreement") among Charter MAC Owner Trust I, Charter MAC Floater Certificate
Trust I (the "Liquidity Borrower"), First Tennessee Bank National Association as
Tender Agent, the Subject Bank and certain other banks from time to time parties
thereto (each, a "Liquidity Bank" and collectively, the "Liquidity Banks"),
[______________________] as Liquidity Agent for the Liquidity Banks and MBIA
Insurance Corporation. Terms defined therein and not otherwise defined in this
letter shall have the respective meanings ascribed therein.
Subject to the qualifications and limitations stated herein, we hereby
advise you that, in our opinion:
1. The Subject Bank is duly organized, validly existing, and in good
standing under the laws of [Name of home jurisdiction].
2. The Agreement has been duly authorized by all necessary corporate
action, has been duly executed and delivered by the Subject Bank and, assuming
due authorization, execution and delivery by each of the other parties thereto,
constitutes a legal, valid and binding obligation of the Subject Bank,
enforceable against the Subject Bank in accordance with its terms.
3. No consent, authorization or approval of, or filing with, any
governmental, administrative or other authority is required in connection with
the execution, delivery or performance of the Agreement by the Subject Bank.
4. The Subject Bank has the corporate power and authority to execute,
deliver and perform the Agreement and the execution, delivery and performance of
the Agreement by the Subject Bank does not conflict with any law, rule or
regulation applicable to the Subject Bank.
5. The obligations of the Subject Bank under the Agreement rank at
least pari passu in priority of payment with other general unsecured claims of
the Subject Bank.
Our opinion set forth in paragraph 2 above is subject to the
qualifications that the enforceability of the Subject Bank's obligations under
the Agreement may be limited by bankruptcy, insolvency, reorganization,
moratorium and other similar laws relating to or affecting creditors' rights
generally or by general equitable principles (regardless of whether such
enforceability is considered in a proceeding in equity or at law). Without in
any way limiting the foregoing, we express no opinion with respect to the
enforceability of the Subject Bank's commitment to make Advances to the
Liquidity Borrower under the Agreement after the commencement of any involuntary
bankruptcy case or other insolvency proceeding against the Liquidity Borrower.
The opinions expressed herein are solely for your benefit in connection
with the transactions contemplated by the Agreement and may not be relied on in
any manner or for any purpose by any other individual, partnership, corporation
or other entity ("Person"), nor any copies thereof published, communicated or
otherwise made available in whole or in part to any other Person without our
specific prior written consent; provided, however, that Standard & Poor's
Ratings Services (a division of The XxXxxx-Xxxx Companies, Inc.), Xxxxx'x
Investors Service, Inc. and [name of domestic counsel to Subject Bank] may be
given copies of this letter and shall be entitled to rely on the opinions
expressed herein to the same extent as if this letter were addressed to them.
Respectfully submitted,
-2-
EXHIBIT I
FORM OF NOTICE OF RECOMMITMENT
[Date]
To: Charter MAC Floater Certificate Trust I
[ ], as [ ]
[ ]
[ ]
Attention: [ ]
Reference is made to (i) the Agreement dated as of May 1, 1998 (the
"Agreement") among CHARTER MAC OWNER TRUST I, CHARTER MAC FLOATER CERTIFICATE
TRUST I, a Delaware business trust (the "Liquidity Borrower"), FIRST TENNESSEE
BANK NATIONAL ASSOCIATION as Tender Agent, the Liquidity Banks named therein,
BAYERISCHE LANDESBANK GIROZENTRALE, NEW YORK BRANCH, as the Liquidity Agent (the
"Liquidity Agent"), and MBIA INSURANCE CORPORATION. Terms defined in the
Agreements are used herein with the same meaning as defined therein.
[The undersigned Liquidity Bank hereby notifies you that the
undersigned has elected to recommit its Liquidity Commitment of $_________ (with
a previously effective Scheduled Liquidity Commitment Termination Date of
_______, ____), for a period until _______, ____, which date shall be the new
Scheduled Liquidity Commitment Termination Date for such Liquidity Commitment.]
[The undersigned Liquidity Bank hereby notifies you that the
undersigned has elected NOT TO RECOMMIT its Liquidity Commitment of $_________
with a Scheduled Liquidity Commitment Termination Date of _______, _____.]
LIQUIDITY BANK: [NAME OF LIQUIDITY BANK]
By:______________________________
Name:
Title:
