Exhibit 4.2
STANDBY BOND PURCHASE AGREEMENT
dated as of
between
, AS TRUSTEE,
and
FGIC SECURITIES PURCHASE, INC.
(Must include Joinder of Tender Agent if different than Trustee)
TABLE OF CONTENTS*
Page
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ARTICLE I
DEFINITIONS
SECTION 1.01 Definitions
1.02 Incorporation of Certain Definitions
by Reference
ARTICLE II
COMMITMENT TO PURCHASE VARIABLE RATE BONDS
SECTION 2.01 Commitment to Purchase
Variable Rate Bonds
2.02 Method of Purchasing
2.03 Termination of Commitment
2.04 Sale of Variable Rate Bonds
2.05 Reduction of Available Commitment
ARTICLE III
CONDITIONS
SECTION 3.01 Conditions to Effectiveness
3.02 Conditions to Purchase
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
SECTION 4.01 Existence
4.02 Authorization
4.03 Corporation Existence
4.04 Authorization; Binding Effect
4.05 Contravention; No Default
4.06 Litigation
______________________
* The Table of Contents is not a part of this Agreement.
Page
----
ARTICLE V
COVENANTS
SECTION 5.01 No Amendment of the GE Capital
Agreement Without Consent of
Issuer, Developer and Trustee
5.02 Other Liquidity Facilities
ARTICLE VI
DEFAULTS
SECTION 6.01 Events of Default
ARTICLE VII
MISCELLANEOUS
SECTION 7.01 Notices
7.02 No Waivers
7.03 Amendments and Waivers
7.04 Successors and Assigns
7.05 Term of this Agreement
7.06 New York Law
7.07 Counterparts
7.08 Trustee May Act through Agents and
Appoint Co-Trustees
7.09 Beneficiaries
7.10 Capacity of Trustee
Exhibit 1 - Notice of Purchase
Exhibit 2 - Termination Notice
Exhibit 3 - Notice Addresses
STANDBY BOND PURCHASE AGREEMENT
STANDBY BOND PURCHASE AGREEMENT (the "Agreement") dated as of
between , a banking corporation , as
Trustee (the "Trustee") and FGIC SECURITIES PURCHASE, INC., a Delaware
corporation (the "Corporation").
WHEREAS, the (the "Issuer") has issued $
principal amount of its (herein called, the "Variable Rate
Bonds") pursuant to an dated as of (the
"Indenture" or the "Authorizing Document"), between the Issuer and the
Trustee (as in effect on the date hereof);
WHEREAS, the Authorizing Document provides that the holders of the
Variable Rate Bonds shall have the option, upon the satisfaction of certain
conditions, to tender Variable Rate Bonds to the Tender Agent for purchase,
upon notice to the Tender Agent as provided for in the Authorizing Document
and, under certain circumstances, may be required to tender their Variable
Rate Bonds for purchase thereof in accordance with the terms of the
Authorizing Document; and
WHEREAS, the Corporation has agreed to purchase such tendered Variable
Rate Bonds pursuant to the terms of this Agreement, as consideration for (i)
the Corporation's status under the Authorizing Document as a Bondholder of
such purchased tendered Variable Rate Bonds entitled to the payments as a
general obligation of the Issuer of principal, interest (at the (Provider
Rate) prescribed herein), and the fees and expenses described therein, (ii)
the Corporation's entitlement to exercise all rights and remedies afforded
Bondholders under the Authorizing Document;
NOW, THEREFORE, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS
SECTION 1.01. Definitions. The following terms, as used herein,
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have the following meanings:
"Authorized Representative" means any official of the Trustee or its
agents and of the Tender Agent, duly authorized and empowered to execute and
deliver this Agreement and all certificates or other documents connected
herewith or in connection with the issuance, sale and subsequent disposition
of the Variable Rate Bonds.
"Available Commitment" as of any day means the sum of the Available
Principal Commitment and the Available Interest Commitment, in each case as
of such day.
"Available Interest Commitment" initially means $ ,
computed based upon the Available Principal Commitment at the Maximum Rate
and thereafter means such initial amount adjusted from time to time as
follows: (a) downward by an amount that bears the same proportion to such
initial amount as the amount of any reduction in the Available Principal
Commitment pursuant to the definition of "Available Principal Commitment"
bears to the initial Available Principal Commitment; and (b) upward by an
amount that bears the same proportion to such initial amount as the amount of
any increase in the Available Principal Commitment pursuant to the definition
of "Available Principal Commitment" bears to the initial Available Principal
Commitment.
"Available Principal Commitment" initially means $ and
thereafter means such initial amount adjusted from time to time as follows:
(a) downward by the amount of any termination or reduction of the Available
Principal Commitment pursuant to Section 2.03 or Section 2.05; (b) downward
by the principal amount of any Bonds purchased by the Corporation pursuant to
Section 2.02; and (c) upward by the principal amount of any Bonds theretofore
purchased by the Corporation pursuant to Section 2.02, which are delivered
for sale by the Corporation pursuant to Section 2.04(b).
"Business Day" has the meaning set forth in the Authorizing Document.
"Commitment" means the Available Commitment calculated without regard to
clauses (b) and (c) of the definition of Available Principal Commitment and
the effect thereof on the amount of the Available Interest Commitment.
"Default" means any condition or event which constitutes an Event of
Default or which, with the giving of notice or lapse of time or both, would,
unless cured or waived, become an Event of Default.
"Default Rate" means a rate of interest per annum equal to the Prime
Rate plus 3%, provided, however, that in no event shall the Default Rate
exceed the Maximum Rate.
"Effective Date" means the date of execution and delivery of this
Agreement.
"Event of Default" has the meaning set forth in Section 6.01.
"GE Capital" means General Electric Corporation.
"GE Capital Agreement" means the Standby Loan Agreement, dated as of
, by and between the Corporation and GE Capital Corporation.
"Maximum Rate" means the lesser of 25% per annum or the maximum rate
permitted by applicable law.
"Moody's" means Xxxxx'x Investors Service, Inc., and its successors.
"Notice of Purchase" has the meaning specified in Section 2.02.
"Person" means an individual, a corporation, a partnership, an
association, a trust or any other entity or organization, including a
government or political subdivision or an agency or instrumentality thereof.
"Prime Rate" means the rate of interest publicly announced by Xxxxxx
Guaranty Trust Company of New York from time to time as its Prime Rate.
"Prospectus Supplement" means the Prospectus Supplement relating to this
Agreement which supplements the Corporation's Prospectus dated the date
hereof included in the Corporation's Registration Statement on Form S-3 (File
No. 33-65928) and amendments thereto, filed with the Securities and Exchange
Commission.
"Prospectus Supplement Effective Date" means the date that the
Prospectus Supplement is filed with the Securities and Exchange Commission in
accordance with the Securities Act of 1933.
"Provider Rate" means the rate of interest per annum equal to the Prime
Rate plus 1%.
"Purchase Date" has the meaning set forth in Section 2.02(d).
"Purchase Period" means the period from the later of
and the Prospectus Supplement Effective Date to and including the earlier of
(i) the Scheduled Termination Date (or, if such date is not a Business Day,
the Business Day immediately succeeding such date), (ii) the date on which
all Variable Rate Bonds have been paid in full, redeemed, defeased or
converted to a Fixed Rate in accordance with the terms of such Variable Rate
Bonds, (iii) the date on which the Commitment is terminated pursuant to
Section 2.03 and (iv) the date on which this Agreement is terminated in
accordance with the applicable provisions of Article of
the Authorizing Document.
"Related Documents" means the Authorizing Document, the Variable Rate
Bonds, the Remarketing Agreement and all other agreements, documents,
certificates and instruments executed and delivered in connection with the
issuance, sale and delivery of the Variable Rate Bonds and the execution and
delivery of this Agreement.
"Remarketing Agent" means and its successors and assigns
under the Remarketing Agreement, including any substitute remarketing agent
appointed pursuant to such Remarketing Agreement.
"Remarketing Agreement" means the Remarketing Agreement dated as of
between the Issuer and the Remarketing Agent.
"Scheduled Termination Date" means from the Effective Date
or such later date to which the Corporation may in its sole discretion, at
the request of the Trustee, extend this Agreement.
"Standard & Poor's" means Standard & Poor's Rating Services and its
successors.
"State" means the State of .
"Tender Agent" means, initially, , and upon any
resignation or removal of such Tender Agent, any other entity thereafter
designated as such pursuant to the Authorizing Document, and its permitted
agents, fiduciary designees, successors and assigns.
"Termination Event" has the meaning set forth in Section 6.01.
"Termination Notice" has the meaning set forth in Section 2.03.
SECTION 1.02. Incorporation of Certain Definitions by Reference.
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Each capitalized term used herein and not otherwise defined herein shall have
the meaning provided therefor in the Authorizing Document.
ARTICLE II
COMMITMENT TO PURCHASE VARIABLE RATE BONDS
SECTION 2.01. Commitment to Purchase Variable Rate Bonds. The
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Corporation agrees, on the terms and conditions contained in this Agreement,
to purchase Variable Rate Bonds bearing interest at a variable rate that are
tendered to the Tender Agent from time to time pursuant to the Authorizing
Document during the Purchase Period at the Purchase Price. In accordance
with Section 2.3 of the GE Capital Agreement, such purchase shall be made
from Corporation moneys or moneys made available by GE Capital to the
Corporation under the GE Capital Agreement. The aggregate principal amount
of the Variable Rate Bonds purchased by the Corporation on any Purchase Date
shall not exceed the Available Principal Commitment on such date and the
aggregate amount of the Purchase Price comprising interest on Variable Rate
Bonds purchased by the Corporation on any Purchase Date shall not exceed the
lesser of (1) the Available Interest Commitment and (2) the actual amount of
interest accrued and unpaid on such Variable Rate Bonds to but excluding such
date. The Corporation agrees that in no event shall amounts paid by it in
respect of the Purchase Price be paid from funds or property of the Issuer.
The parties hereto acknowledge that the obligation of the Corporation
hereunder to purchase Variable Rate Bonds pursuant and subject to the terms
and conditions of this Agreement is irrevocable and that the Corporation
shall become a Bondholder under the Authorizing Document of each Variable
Rate Bond purchased under this Agreement and that the Corporation, as such
Bondholder, shall be entitled, as the holder of Provider Bonds bearing
interest at the Provider Rate, to all rights and remedies granted to
Bondholders of Variable Rate Bonds under the Authorizing Document. From and
after the Effective Date, the obligation of the Corporation to purchase
Variable Rate Bonds pursuant to this Agreement shall run to the benefit of
those beneficiaries identified in Section 7.09.
SECTION 2.02. Method of Purchasing. (a) Pursuant to Section
--------------------
of the Authorizing Document, the Trustee will give notice to the
Corporation, the Issuer and the Tender Agent of the principal amount of
Variable Rate Bonds for which it has arranged a remarketing. Pursuant to the
Authorizing Document and Section 2.02(b) herein below, the Tender Agent will
give notice to the Corporation if Variable Rate Bonds bearing interest at a
Variable Rate are to be purchased by the Corporation due to the
unavailability of remarketing proceeds for such purchase.
(b) If by 11:30 p.m. (New York City time) on any Business Day during
the Purchase Period the Corporation receives a notice of purchase from the
Tender Agent substantially in the form of Exhibit 1 hereto (any such notice
to be referred to as a "Notice of Purchase"), the Corporation will pay,
unless it determines that any applicable condition specified in Section 3.02
below is not satisfied, not later than 2:30 p.m. (New York City time) on the
Purchase Date to the Tender Agent, in funds to be available as specified in
such Notice of Purchase, an amount equal to the aggregate Purchase Price.
(c) The Corporation shall not have any responsibility for, or incur any
liability in respect of, any act, or any failure to act, by the Tender Agent
which results in the failure of the Tender Agent (x) to credit the
appropriate account with funds made available by the Corporation pursuant to
this Section or (y) to effect the purchase for the account of the Corporation
of Variable Rate Bonds with such funds pursuant to this Section.
(d) The "Purchase Date" for any purchase of Variable Rate Bonds shall
be the date specified in the Notice of Purchase; provided
--------
that in no event shall the Purchase Date be (i) on the same day the Notice of
Purchase is received if the Notice of Purchase is received by the Corporation
later than 11:30 p.m. (New York City time) or (ii) after the last day of the
Purchase Period.
SECTION 2.03. Termination of Commitment. If at any time a
-------------------------
Termination Event shall have occurred and be continuing, the Corporation may
deliver a notice (a "Termination Notice") regarding the termination of the
Commitment substantially in the form of Exhibit 2 hereto to the Trustee, the
Issuer, the Remarketing Agent and the Tender Agent at the addresses set forth
in Exhibit 3 hereto (or such other addresses as may be specified by such
Persons for such purpose in writing to the Corporation), and the Commitment
shall terminate, effective at the close of business on the
day following the date of receipt of such notice by the Trustee, or if such
day is not a Business Day, the next succeeding Business Day.
SECTION 2.04. Sale of Variable Rate Bonds. (a) Remarketing
---------------------------
Notices. Prior to 11:15 a.m. (New York City time) on any Business Day on
which the Corporation holds Variable Rate Bonds purchased pursuant to this
Agreement, the Remarketing Agent may deliver a notice (a "Remarketing
Notice") to the Corporation, the Trustee and the Issuer stating that it has
located a purchaser (the "Purchaser") for some or all of such Variable Rate
Bonds and that such Purchaser desires to purchase on such Business Day such
Variable Rate Bonds at the principal amount thereof plus accrued interest at
the rate such Variable Rate Bonds would have accrued interest had such bonds
not been Provider Bonds.
(b) Sale of Purchased Variable Rate Bonds. Upon receipt of a
-------------------------------------
Remarketing Notice in accordance with subsection (a), the Corporation shall
direct the Tender Agent to deliver those Variable Rate Bonds held in the
account of the Corporation being remarketed by the Remarketing Agent against
payment for such Variable Rate Bonds in an amount equal to the principal
amount thereof plus interest accrued thereon at the Provider Rate.
(c) Right to Sell Bonds. The Corporation expressly reserves the
-------------------
right to sell, at any time, Provider Bonds purchased by it pursuant to this
Agreement provided that any such purchaser acknowledges in writing that its
purchase pursuant to this Section 2.04(c) is subject to the provisions of
Sections 2.04(a) and (b) hereof.
(d) Sale Without Recourse. Any sale of a Variable Rate Bond, or
---------------------
portion thereof, pursuant to Section 2.04(c) and other than pursuant to a
remarketing shall be without recourse to the seller and without
representation or warranty of any kind except as may be required by law.
SECTION 2.05. Reduction of Available Commitment. Upon any
---------------------------------
redemption, defeasance, repayment or other payment, or on the fifth day
following conversion to a Fixed Rate of all or any portion of the principal
amount of the Variable Rate Bonds, the aggregate Available Principal
Commitment shall automatically be terminated by an amount equal to the
principal amount of the Variable Rate Bonds so redeemed, defeased, repaid or
otherwise paid or converted, as the case may be.
ARTICLE III
CONDITIONS
SECTION 3.01. Conditions to Effectiveness. This Agreement shall not
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become effective until each of the following conditions has been satisfied:
(a) receipt by the Corporation of an opinion of counsel for the
Trustee, dated the Effective Date, covering the matters represented or
warranted in Sections 4.01 and 4.02 hereof;
(b) receipt by the Trustee of an opinion of counsel for the
Corporation, dated the Effective Date, covering the matters represented
or warranted in Sections 4.03, 4.04, 4.05 and 4.06 hereof;
(c) reliance letters shall have been addressed and delivered to
the Corporation with respect to the legal opinions delivered in
connection with the execution of this Agreement and the Variable Rate
Bonds;
(d) receipt by the Corporation of a certificate from an Authorized
Representative of the Trustee to the effect that as of the Effective
Date, to the Trustee's best knowledge no "event of default" exists under
the Authorizing Document nor does any event exist which might become an
event of default with the passage of time or giving of notice or both;
and
(e) Financial Guaranty Insurance Company shall have issued a
policy of municipal bond insurance guaranteeing payment of the full
amount of principal of and interest on the Variable Rate Bonds in
accordance with Financial Guaranty's Commitment Letter dated
, 199_ relating to such policy.
On the Effective Date, the Corporation shall deliver its certificate
stating that this Agreement has become effective and that the conditions
precedent thereto have been satisfied.
SECTION 3.02. Conditions to Purchase. The obligation of the
----------------------
Corporation to purchase Variable Rate Bonds hereunder on any Purchase Date is
subject to satisfaction of the following conditions:
(a) receipt by the Corporation of a Notice of Purchase as required by
Section 2.02;
(b) the fact that the Variable Rate Bonds to be so purchased are not
beneficially held (or held in certificated form) by or for the account of the
Issuer, any affiliate of the Issuer or any broker-dealer holding Variable
Rate Bonds pursuant to an arrangement with the Issuer; and
(c) To the extent Variable Rate Bonds are certificated the Tender Agent
shall hold, in trust for the Corporation, Variable Rate Bonds purchased by
the Corporation hereunder; the Tender Agent shall register such Variable Rate
Bonds purchased by the Corporation in the name of the Corporation or in such
other name or names as the Corporation may direct.
The Corporation shall be obligated to purchase Variable Rate Bonds with
respect to which the condition set forth in clause (b) has been satisfied
notwithstanding the fact that such condition has not been satisfied with
respect to all of the outstanding Variable Rate Bonds. The Corporation shall
notify the Trustee, the Tender Agent and the Issuer by telephone no later
than 1:30 p.m. on any Purchase Date in the event any of the conditions set
forth in this section are not met.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
The Trustee represents and warrants that, as of the date on which this
Agreement is executed:
SECTION 4.01. Existence. The Trustee is validly existing
---------
banking corporation, with full right and power to execute, deliver and
perform its obligations under this Agreement and each Related Document to
which it is a party.
SECTION 4.02. Authorization. This Agreement has been duly
-------------
authorized, executed and delivered by the Trustee.
The Corporation represents and warrants that, as of the date on which
this Agreement is executed:
SECTION 4.03. Corporation Existence. The Corporation has been duly
---------------------
incorporated, is validly existing as a corporation in good standing under the
laws of the State of Delaware.
SECTION 4.04. Authorization; Binding Effect. This Agreement and the
-----------------------------
GE Capital Agreement each has been duly executed and delivered by the
Corporation pursuant to due authorization and each of this Agreement and the
GE Capital Agreement constitutes a valid and binding agreement of the
Corporation enforceable against the Corporation in accordance with its terms,
except as (x) limited by insolvency, reorganization, receivership,
conservatorship, liquidation, moratorium or other similar laws affecting the
enforcement of creditors' rights generally as such laws would apply in the
event of the insolvency, reorganization, receivership, conservatorship or
liquidation of, or other similar occurrence with respect to, the Corporation
or in the event of any moratorium or similar occurrence affecting the
Corporation and (y) limited by equitable principles (regardless of whether
the issue of enforceability is considered in a proceeding in equity or at
law).
SECTION 4.05. Contravention; No Default. The execution and delivery
-------------------------
by the Corporation of, and the performance by the Corporation of its
obligations under, this Agreement will not contravene any provision of
applicable law or the Certificate of Incorporation or By-laws, each as
amended, of the Corporation or any material agreement or other instrument
binding upon the Corporation, and no consent, approval or authorization of
any governmental body or agency (which has not been obtained) is required for
the performance by the Corporation of its obligations under this Agreement.
SECTION 4.06. Litigation. There is no action, suit or proceeding
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pending against, or to the knowledge of the Corporation threatened against,
the Corporation before any court or arbitrator or any governmental body,
agency or official in which there is a reasonable possibility of an adverse
decision which could materially adversely affect the financial position or
results of operations of the Corporation or which in any manner draws into
question the validity or enforceability of this Agreement or the
Corporation's ability to perform under this Agreement.
ARTICLE V
COVENANTS
SECTION 5.01. No Amendment of GE Capital Agreement Without Consent
----------------------------------------------------
of Issuer and Trustee. Without the prior written consent of the Trustee
----------------------
and the Issuer, the Corporation will not agree or consent to any amendment,
supplement or modification of the GE Capital Agreement, nor waive any
provision thereof. The Corporation hereby repeats, for the benefit of the
Trustee and the Issuer and the holders of the Variable Rate Bonds, the
covenants set forth in Section 6.1 of the GE Capital Agreement, which
covenants, as well as the related defined terms contained therein, are hereby
incorporated by reference with the same effect as if each and every such
covenant and defined term were set forth herein in its entirety.
SECTION 5.02. Other Liquidity Facilities. The Corporation agrees
--------------------------
not to enter into another standby bond purchase agreement or other similar
form of liquidity facility in support of the tender feature of adjustable
rate bonds, unless such bonds are rated by both Moody's and Standard & Poor's
in their highest short-term and long-term rating categories after giving
effect to such other agreement or liquidity facility in support of the tender
feature of adjustable rate bonds.
ARTICLE VI
DEFAULTS
SECTION 6.01. Events of Default. If one or more of the following
-----------------
events ("Events of Default") shall have occurred and be continuing:
(a) (i) any portion of the commitment fee for this Agreement shall
not be paid when due on the quarterly payment date therefor as set forth
in the Payment Agreement, or (ii) any other amount payable thereunder
shall not be paid when due and any such failure shall continue for three
(3) Business Days;
(b) (i) an Event of Default shall occur under Section
of the Indenture, and, if such failure is the result of a covenant
breach which is capable of being remedied, such failure continues for
sixty (60) days following written notice thereof to the Issuer from the
Corporation, or (ii) the Issuer shall fail to have at all times a
Remarketing Agent performing the duties thereof contemplated by the
Authorizing Document;
(c) any default by the Issuer shall have occurred and be
continuing in the payment of principal of or premium, if any, or
interest on any bond, note or other evidence of indebtedness issued,
assumed or guaranteed by the Issuer, the obligation and security for
which under the Authorizing Document is senior to, or on parity with,
the Variable Rate Bonds;
(d) if the Issuer shall have declared a moratorium affecting the
Variable Rate Bonds; or
(e) any material provision of this Agreement, the Authorizing
Document or the Variable Rate Bonds shall cease for any reason
whatsoever to be a valid and binding agreement of the Issuer or the
Issuer shall contest the validity or enforceability thereof;
then, and in every such event (each such event is herein called a
"Termination Event"), (i) the interest rate payable on Provider Bonds shall
increase to the Default Rate, and (ii) the Corporation may terminate the
Corporation's obligation to purchase Variable Rate Bonds pursuant to this
Agreement as provided in Section 2.03; provided that an Event of Default
shall not affect the obligation of the Corporation to purchase Variable Rate
Bonds in accordance with the provisions of this Agreement prior to the close
of business on the date on which such obligation terminates pursuant to
Section 2.03.
ARTICLE VII
MISCELLANEOUS
SECTION 7.01. Notices. All notices, requests and other
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communications to any party hereunder shall be in writing (including fax or
similar writing) and shall be given to such party at its address or facsimile
number set forth on the signature pages hereof or such other address or
facsimile number as such party may hereafter specify for the purpose by
notice to the other parties. Each such notice, request or other
communication shall be effective (i) if given by facsimile, when such
facsimile is transmitted to the facsimile number specified in this Section
and the appropriate answerback is received, (ii) if given by mail, 72 hours
after such communication is deposited in the mails with first class postage
prepaid, addressed as aforesaid or (iii) if given by any other means, when
delivered at the address specified in this Section; provided that notices to
________
the Corporation under Sections 2.02 and 2.04
shall not be effective until received and that notices under Sections 2.02
and 2.04 may also be given by telephone to the Corporation at the telephone
numbers listed on the signature pages hereof (or such other telephone number
as may be designated by the Corporation, by written notice to the Trustee and
the Tender Agent, to receive such notice), immediately confirmed in writing
or by facsimile.
SECTION 7.02. No Waivers. (a) The obligations of the parties
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hereunder shall not in any way be modified or limited by reference to any
other document, instrument or agreement (including, without limitation, the
Variable Rate Bonds or any other Related Document) except as set forth
herein. The rights of the Corporation hereunder are separate from and in
addition to any rights that any holder of any Variable Rate Bond may have
under the terms of such Variable Rate Bond or any Related Document or
otherwise.
(b) No failure or delay by the Corporation in exercising any right,
power or privilege hereunder or under the Variable Rate Bonds shall operate
as a waiver thereof nor shall any single or partial exercise thereof preclude
any other or further exercise thereof or the exercise of any other right,
power or privilege. The rights and remedies herein provided shall be
cumulative and not exclusive of any rights or remedies provided by law. No
failure or delay by the Corporation in exercising any right, power or
privilege under or in respect of the Variable Rate Bonds or any other Related
Document shall affect the rights, powers or privileges of the Corporation
hereunder or shall operate as a limitation or waiver thereof.
SECTION 7.03. Amendments and Waivers. Any provision of this
----------------------
Agreement may be amended or waived if, but only if, such amendment or waiver
is in writing and is signed by the Trustee and the Corporation. The Trustee
will notify Moody's and Standard & Poor's of any amendment to this Agreement,
each of which must confirm to the Trustee prior to such amendment or waiver
becoming effective that such amendment or waiver shall not result in a change
in the rating initially received from Moody's and Standard & Poor's.
SECTION 7.04. Successors and Assigns. The provisions of this
----------------------
Agreement shall be binding upon and inure to the benefit of the parties
hereto and their respective successors and assigns; provided that neither
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party may assign or otherwise transfer any of its rights under this Agreement
without the prior written consent of the other party except to any successor
Trustee pursuant to the terms of the Authorizing Documents. The Trustee
shall notify Moody's and Standard & Poor's in writing of any assignment or
transfer, each of which must confirm to the Trustee that prior to such
assignment or waiver becoming effective such assignment or transfer shall not
result in a change in the rating initially received from Moody's and Standard
& Poor's.
SECTION 7.05. Term of this Agreement. The term of this Agreement
----------------------
shall be until the earlier of (i) the Scheduled Termination Date and (ii)
payment in full of the principal of and interest on all Variable Rate Bonds
purchased by the Corporation pursuant to this Agreement.
SECTION 7.06. New York Law. This Agreement shall be construed in
------------
accordance with and governed by the law of the State of New York.
SECTION 7.07. Counterparts. This Agreement may be signed in
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counterparts, each of which shall be an original, with the same effect as if
the signatures thereto and hereto were upon the same instrument.
SECTION 7.08. Trustee May Act through Agents and Appoint Co
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Trustees. The Trustee may execute any of the powers hereof and perform
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any duties hereunder either directly or by or through its agents or
attorneys. The Trustee may delegate to a co-trustee or co-trustees such
power, rights, duties and responsibilities as the Trustee may deem necessary
or desirable in order to permit the Trustee to lawfully execute and perform
the duties set forth in this Agreement.
SECTION 7.09. Beneficiaries. This Agreement is made by the
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Corporation with the Trustee and the Issuer for the express benefit of the
holders of the Variable Rate Bonds. Nothing contained herein, express or
implied, is intended to give any person other than the Corporation, the
Trustee, the Issuer and the holders of the Variable Rate Bonds any right,
remedy, or claim hereunder or by reason hereof. Any agreement or covenant
required herein to be performed by or on behalf of the Corporation shall be
for the sole and exclusive benefit of the Trustee, the Issuer and the holders
of the Variable Rate Bonds. Prior to the Scheduled Termination Date and
provided that the Commitment hereunder has not terminated pursuant to the
provisions of Sections 2.03 and 6.01 hereof, the Corporation agrees that it
will not assert any act or failure to act by the Issuer, including without
limitation (A) the commencement of a bankruptcy or similar case by or against
the Issuer, (B) the unenforceability or nonpayment of the Provider Rate in
any such case, (C) the unenforceability of the Payment Agreement, or (D) any
default under any Related Document or Event of Default as a defense to its
obligations hereunder, and that this Agreement shall survive (A) the
commencement of a bankruptcy or similar case by or against the Issuer, (B)
the unenforceability or nonpayment of the Provider Rate in any such case, (C)
the unenforceability of the Payment Agreement among the Issuer, the Trustee
and the Corporation in any such case, or (D) any default under any Related
Document or Event of Default. The Corporation agrees that, so long as this
Agreement is in effect and has not terminated, the holders of the Variable
Rate Bonds are express beneficiaries of this Agreement and, as such, any
holder of a Variable Rate Bond shall have the right to bring suit against the
Corporation to enforce this Agreement should the Corporation fail to perform
any of its obligations hereunder.
SECTION 7.10 Capacity of Trustee. The Trustee is entering into this
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Agreement solely in its capacity as Trustee (and Tender Agent) under the
Authorizing Document and the duties, powers and liabilities of the Trustee in
acting hereunder as Trustee and as Tender Agent shall be subject to the
provisions of the Authorizing Document including, without limitation, the
provisions of Article of the Indenture.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed by their respective authorized officers as of the day and year
first above written.
,
as Trustee
__________________________
By:_______________________
Title:_____________________
Attention:
Fax Number:
Telephone Number:
FGIC SECURITIES PURCHASE, INC.
By_______________________________
Vice President
000 Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: President
Copy: Managing Counsel
Fax Number: (000) 000-0000
Telephone number: (000) 000-0000
EXHIBIT 1
(LETTERHEAD OF THE TRUSTEE/TENDER AGENT)
NOTICE OF PURCHASE
(Date)
FGIC Securities Purchase, Inc.
000 Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention:__________________________
Re:
Dear Sirs:
Reference is made to the Standby Bond Purchase Agreement dated as of
(the "Agreement") between , as Trustee and FGIC
Securities Purchase, Inc. Capitalized terms used herein shall have the
meanings given to them in or by reference to the Agreement.
Pursuant to Section 2.02(a) of the Agreement, we hereby give you notice
that due to the unavailability of remarketing proceeds on the Purchase Date
(hereinafter defined) as set forth in the notice from the Remarketing Agent
pursuant to Section 2.02(a) of the Agreement, such Variable Rate Bonds are to
be purchased by you on ____________ __, 199_ (the "Purchase Date") pursuant
to Section 2.02 of the Agreement. The aggregate Purchase Price of such
Variable Rate Bonds is __________ dollars ($________). Of such aggregate
Purchase Price, __________ dollars ($______) comprises principal of such
Variable Rate Bonds and _________ dollars ($______) comprises interest
accrued on such Variable Rate Bonds to but excluding the Purchase Date. The
Variable Rate Bonds referred to herein bear interest at a Variable Rate and
have not been defeased.
FGIC Securities Purchase, Inc. (Date)
The Purchase Price should be provided in immediately available funds on
the Purchase Date.
Very truly yours,
(TRUSTEE/TENDER AGENT)
By:______________________________
Name:
Title:
EXHIBIT 2
(LETTERHEAD OF CORPORATION)
TERMINATION NOTICE
as trustee
Attention:
Re:
Dear Sirs:
Reference is made to the Standby Bond Purchase Agreement dated as of
between , as Trustee and FGIC Securities
Purchase, Inc. (the "Agreement"). Capitalized terms used herein shall have
the meanings given to them in or by reference to the Agreement.
We hereby give you notice that a Termination Event has occurred and is
continuing. Pursuant to Section 2.03 of the Agreement, the Commitment shall
terminate, effective at the close
____ __, 199_
Page Two
of business on the date which is the day following the date
of receipt of this Termination Notice, or if such day is not a Business Day,
the next succeeding Business Day.
Please be advised that a Notice of Purchase may not be delivered
following the termination of the Commitment.
Very truly yours,
FGIC SECURITIES PURCHASE, INC.
By: __________________________
Name:
Title:
EXHIBIT 3
NOTICE ADDRESSES
----------------
As set forth herein and in the Authorizing Document
A G R E E M E N T
-----------------
AGREEMENT (the "Agreement") dated as of , 199_ among
(the "Issuer"), , as Trustee (the "Trustee") and FGIC
SECURITIES PURCHASE, INC., a Delaware corporation (the "Corporation").
WHEREAS, the Issuer has issued $ in principal amount of its
(herein called, the "Variable Rate Bonds") pursuant to
an dated as of , between the Issuer and
the Trustee (the "Indenture" or the "Authorizing Document");
WHEREAS, the Authorizing Document provides that the holders of the
Variable Rate Bonds shall have the option, upon the satisfaction of certain
conditions, to tender Variable Rate Bonds to the Tender Agent for purchase,
upon notice to the Tender Agent as provided for in the Authorizing Document
and, under certain circumstances, may be required to tender their Variable
Rate Bonds for purchase thereof in accordance with the terms of the
Authorizing Document; and
WHEREAS, the Corporation has agreed to purchase such tendered Bonds
pursuant to the terms of a Standby Bond Purchase Agreement dated as of
(the "Standby Bond Purchase Agreement") between the Corporation and the
Trustee;
NOW, THEREFORE, as consideration for the issuance by the Corporation of
the Standby Bond Purchase Agreement and the Corporation's assumption of the
liabilities and undertakings of the Corporation thereunder, the parties
hereto agree as follows (hereinafter, all capitalized terms not otherwise
defined herein shall have the same meanings set forth in the Standby Bond
Purchase Agreement or in the Authorizing Document, wherever such terms
appear):
1. Fees. (a) Until the Commitment has terminated, the
----
shall pay to the Corporation a commitment fee at the rate of %
per annum on the daily average amount of the Available Commitment. Such
commitment fee shall accrue from and including the Effective Date to but
excluding the date of termination of the Commitment in its entirety and shall
be payable quarterly in arrears commencing , on each,
and upon the date of termination of the Commitment in its entirety. The
Corporation shall use its best efforts to mail to the Issuer and the Trustee,
not fewer than 30 days prior to each quarterly due date, an invoice for the
amount of the commitment fee next due. The commitment fee shall be computed
on the basis of a year of 365/366 days and paid for the actual number of days
elapsed.
(b) Whenever any payment hereunder shall be due on a day which is not a
Business Day, the date for payment thereof shall be extended to the next
succeeding Business Day.
2. General Provisions as to Payments. Notwithstanding any provision
---------------------------------
contained in the Variable Rate Bonds, any related Document, or any other
instrument, so long as any of the Variable Rate Bonds are owned by the
Corporation under the Standby Bond Purchase Agreement, the Trustee on behalf
of the Issuer shall cause each payment of principal of and interest on such
Variable Rate Bonds to be paid not later than 2:00 p.m., New York City time
on the date when due in immediately available funds, to the account of the
Corporation at , New York, New York, A/C No.
. Commitment fees due to the Corporation pursuant to Section 1 hereof shall
be paid by the Issuer not later than 2:00 p.m., New York City time on the
date when due in immediately available funds, or on the prior day in next day
funds, to the account of the Corporation.
3. Expenses. The Issuer shall pay all reasonable out-of-pocket
--------
expenses of the Corporation, including (i) fees and disbursements of counsel
for the Corporation and counsel for the Trustee in connection with the
preparation and review of the Standby Bond Purchase Agreement, this
Agreement, Securities and Exchange Commission filings, the Preliminary and
final Official Statements and the Related Documents, (ii) in connection with
any waiver or consent hereunder or thereunder or any amendment hereof or
thereof or any default or alleged default hereunder or thereunder and (iii)
if an Event of Default occurs under the Standby Bond Purchase Agreement, all
out-of-pocket expenses incurred by the Corporation and the Trustee, including
fees and disbursements of counsel, in connection with such Event of Default
and collection and other enforcement proceedings resulting therefrom.
4. Indemnification. To the extent permitted by law, the hereby
---------------
Issuer indemnifies and holds harmless the Corporation from and against the
cost of defending any and all third party claims and all costs, losses,
expenses, fines, penalties and all other liabilities whatsoever that the
Corporation may incur (or may be claimed against the Corporation by any
person whatsoever) (i) by reason of any untrue statement or alleged untrue
statement relating to the Issuer or of any material fact contained or
incorporated by reference in the Preliminary and Final Official Statements or
Preliminary or Final Reoffering Circular, or supplements thereto, relating to
the Variable Rate Bonds, or the omission or alleged omission to state therein
a material fact relating to the Issuer or necessary to make such statements,
in the light of the circumstances under which they are or were made, not
misleading (excluding any materials expressly provided for inclusion therein
by the Corporation or Financial Guaranty Insurance Company); provided that
the Issuer shall not be required to indemnify the Corporation for any costs
of defending third party claims or liabilities to the extent, but only to the
extent, such claims or liabilities arise due to the willful misconduct or
gross negligence of the Corporation or are attributable to information
concerning the Corporation or Financial Guaranty Insurance Company expressly
for use in the Official Statement or Preliminary or Final Reoffering
Circular, or supplements thereto. The Corporation will promptly notify the
Issuer upon becoming aware of any claims or liabilities giving rise to a
right to indemnification hereunder and will cooperate with the Issuer in the
defense of such claims or liabilities. Nothing in this Section is intended
to limit the Issuer's obligations contained in other parts of this Agreement.
The Issuer will not refer to the Corporation in any materials used in
marketing the Variable Rate Bonds without the prior written consent of the
Corporation. The Corporation hereby agrees to provide the Issuer with any
disclosure information which the Issuer may reasonably request relating to
the Corporation for inclusion in the Preliminary and Final Official
Statements relating to the Variable Rate Bonds.
5. Term of the Standby Bond Purchase Agreement. As further provided
-------------------------------------------
in the Standby Bond Purchase Agreement, the term of the Standby Bond Purchase
Agreement shall be until the later of (i) the termination of the Commitment
in its entirety and (ii) payment in full of the principal of and interest on
all Variable Rate Bonds purchased by the Corporation pursuant to the Standby
Bond Purchase Agreement and payment in full of any other amounts required to
be paid by the Issuer pursuant to any provision of this Agreement. Any
termination by the Corporation or by the Trustee shall be subject to the
Issuer's payment in full of all sums due pursuant to this Agreement and,
notwithstanding a termination of the Standby Bond Purchase Agreement by
either the Corporation or the Trustee, the provisions of Section 5 shall
survive such termination and shall remain in full force and effect.
6. Issuer Representations and Warranties. The Issuer represents and
-------------------------------------
warrants that, as of the date on which this Agreement is executed:
(a) Existence. The Issuer is validly existing as a public benefit
---------
corporation under the laws of the State of New York, including the state
constitution, with full right and power to issue the Bonds and to execute,
deliver and perform its obligations under this Agreement and each Related
Document.
(b) Authorization; Contravention. The execution, delivery and
----------------------------
performance by the Issuer of this Agreement and each Related Document are
within the Issuer's powers, have been duly authorized by all necessary
action, require no action by or in respect of, or filing with, any
governmental body, agency or official and do not violate or contravene, or
constitute a default under, any provision of applicable law, charter,
ordinance or regulation or of any material agreement, judgment, injunction,
order, decree or other instrument binding upon the Issuer or result in the
creation or imposition of any lien or encumbrance on any asset of the Issuer.
(c) Binding Effect. This Agreement and each Related Document
--------------
constitutes a valid, binding and enforceable agreement of the Issuer, subject
to applicable laws affecting creditor's rights generally.
(d) No Default. It is not, in any material respect, in breach of
----------
or default under its charter or other similar documents, or any applicable
law or administrative regulation of the State or of the United States,
relating, in each case, to the issuance of debt securities by it, or any
applicable judgment, decree, loan agreement, note, resolution, ordinance,
agreement or other instrument to which it is a party or is otherwise subject.
Late delivery of financials or other reporting materials shall not be deemed
material for purposes of this Section as long as said materials are delivered
within 180 days of the applicable due date.
(e) Litigation. Except as disclosed in the Official Statement with
----------
respect to the Bonds, there is no action, suit or proceeding pending against,
or to the knowledge of the Issuer threatened against or affecting, the Issuer
before any court or arbitrator or any governmental body, agency or official
in which there is a reasonable possibility of an adverse decision which could
materially adversely affect the financial position or results of operations
of the Issuer or which in any manner draws into question the validity or
enforceability of this Agreement or any Related Document.
(f) No Sovereign Immunity. The defense of sovereign immunity is
---------------------
not available to the Issuer in any proceeding by the Corporation to enforce
any of the obligations of the Issuer under this Agreement or the Bonds and,
to the fullest extent permitted by law, the Issuer consents to the initiation
of any such proceeding in any federal or state court of competent
jurisdiction located in the State of New York and agrees not to assert the
defense of sovereign immunity in any such proceeding
.
7. New York Law. This Agreement shall be construed in accordance
------------
with and governed by the law of the State of New York. Concurrently with the
execution and delivery hereof, the Issuer shall deliver an opinion of its
general counsel, addressed to, and in form and substance acceptable to, the
Corporation, as to the power, authority and valid and binding effect of this
Agreement upon the Issuer, subject only to the customary creditors' rights
exceptions.
8. Covenants. The Issuer agrees that so long as the Corporation has
---------
a Commitment hereunder or any amount payable hereunder or under any Bond
purchased by the Corporation pursuant to this Agreement remains unpaid:
(a) Information. The Issuer will deliver to the
-----------
Corporation as soon as possible and in any event within 120 days after the
end of each Fiscal Year of the Issuer, a balance sheet of the Issuer as of
the end of such Fiscal Year and the related statements of revenue and
expense, setting forth in each case in comparative form the figures for the
previous Fiscal Year, all certified as to the fairness of presentation,
generally accepted accounting principles and consistency by a nationally
recognized firm of independent certified public accountants.
(b) No Amendment Without Consent of the Corporation. Without
-----------------------------------------------
the prior written consent of the Corporation, the Issuer will not agree or
consent to any amendment, supplement or modification of any Related Document,
nor waive any provision thereof.
(c) Maintenance of Remarketing Agent. The Issuer will at all
--------------------------------
times cause the Issuer to have a Remarketing Agent performing the duties
thereof contemplated by the Authorizing Document.
9. Capacity of Trustee. The Trustee is entering into this Agreement
-------------------
solely in its capacity as Trustee under the Authorizing Document and the
duties, powers and liabilities of the Trustee in acting hereunder shall be
subject to the provisions of the Authorizing Document, including, without
limitation, the provisions of Article of the Indenture
thereof.
10. Counterparts. This Agreement may be signed in counterparts,
------------
each of which shall be an original, with the same effect as if the signatures
thereto and hereto were upon the same instrument.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed by their respective authorized officers as of the day and year
first above written.
, as Trustee
By:_______________________
Title:
Address:
Attention:
Fax Number:
Telephone Number:
, as Issuer
By:________________________
Title:
Address:
Attention:
Fax Number:
Telephone Number:
FGIC SECURITIES PURCHASE, INC.
By:____________________________
Title: Vice President
000 Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: President
Copy To: Managing Counsel
Fax Number: (000) 000-0000
Telephone number: (000) 000-0000
EXHIBIT A
OPINION OF COUNSEL FOR THE ISSUER
____ __, 199_
________________________________
Attention: ____________________
FGIC Securities Purchase, Inc.
000 Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Re:
Dear Sirs:
We have acted as counsel for the in connection with (i)
the Standby Bond Purchase Agreement dated as of (the "Standby
Bond Purchase Agreement") between FGIC Securities Purchase, Inc. and
, as Trustee, (ii) the between the Issuer and the
Trustee dated as of relating to the Variable Rate Bonds
described therein (the "Authorizing Document") and (iii) the Payment
Agreement among the Issuer,, the Trustee and FGIC Securities Purchase, Inc.
dated as of (the "Payment Agreement"). The Standby Bond
Purchase Agreement, the Authorizing Document and the Payment Agreement are
hereinafter referred to as the "Agreements". You have requested our opinion
as to certain matters concerning the Agreements. Terms defined in the
Standby Bond Purchase Agreement or in the Payment Agreement are used herein
as defined therein.
____ __, 199_
Page Two
Based on our examination of existing law, the Agreements, such legal
proceedings and such other documents as we deem necessary to render this
opinion, we are of the opinion that:
1. The Issuer is duly incorporated and is validly existing as a company
in good standing under the laws of .
2. The Payment Agreement has been duly executed and delivered by the
Issuer pursuant to due authorization and the Payment Agreement constitutes
the valid and binding agreement of the Issuer enforceable against the Issuer
in accordance with its terms, except as (x) limited by insolvency,
reorganization, receivership, conservatorship, liquidation, moratorium or
other similar laws affecting the enforcement of creditors' rights generally
as such laws would apply in the event of the insolvency, reorganization,
receivership, conservatorship or liquidation of, or other similar occurrence
with respect to, the Issuer or in the event of any moratorium or similar
occurrence affecting the Issuer, (y) limited by equitable principles
(regardless of whether the issue of enforceability is considered in a
proceeding in equity or at law) and (z) the indemnification provisions
thereof may be limited by Federal securities laws.
3. The execution and delivery by the Issuer of, and the performance by
the Issuer of its obligations under, the Payment Agreement will not
contravene any provision of applicable law or the Restated Articles of
Incorporation or By-laws, each as amended, of the Issuer or any material
agreement or other instrument binding upon the Issuer known to us, and no
consent, approval or authorization of any governmental body or agency (which
has not been obtained) is required for the performance by the Issuer of its
obligations under the Payment Agreement.
4. Except as disclosed in 's Registration
Statement on Form S- (Registration No. 333- ) in the form it
became effective with the Securities and Exchange Commission, there is no
action, suit or proceeding pending against, or to the best of our knowledge,
threatened against, the Issuer before any court or arbitrator or any
governmental body, agency or official in which there is a reasonable
possibility of an adverse decision which could materially adversely affect
the financial position or results of operations of the Issuer or which in any
manner draws into question the validity or enforceability of the Payment
Agreement.
Very truly yours,
_______________________
Counsel for Issuer
