EXHIBIT 4.1
EXECUTION COPY
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XXXXX HOME EQUITY LOAN TRUST 2001-2,
as Issuer,
and
XXXXX FARGO BANK MINNESOTA,
NATIONAL ASSOCIATION,
as Indenture Trustee
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INDENTURE
Dated as of August 31, 2001
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HOME EQUITY LOAN-BACKED TERM NOTES
HOME EQUITY LOAN-BACKED VARIABLE FUNDING NOTES
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TABLE OF CONTENTS
PAGE
ARTICLE I DEFINITIONS.....................................................1
Section 1.01. Definitions................................................1
Section 1.02. Incorporation by Reference of Trust Indenture Act..........2
Section 1.03. Rules of Construction......................................2
ARTICLE II ORIGINAL ISSUANCE OF NOTES.....................................2
Section 2.01. Form.......................................................2
Section 2.02. Execution, Authentication and Delivery.....................3
ARTICLE III COVENANTS.....................................................3
Section 3.01. Reserved...................................................3
Section 3.02. Maintenance of Office or Agency............................3
Section 3.03. Money for Payments To Be Held in Trust; Paying Agent.......4
Section 3.04. Existence..................................................5
Section 3.05. Payment of Principal and Interest; Defaulted Interest......5
Section 3.06. Protection of Trust Estate.................................9
Section 3.07. Opinions as to Trust Estate................................9
Section 3.08. Performance of Obligations; Sale and Servicing Agreement..10
Section 3.09. Negative Covenants........................................10
Section 3.10. Annual Statement as to Compliance.........................11
Section 3.11. Recordation of Assignments................................11
Section 3.12. Representations and Warranties Concerning the Mortgage
Loans.....................................................11
Section 3.13. Assignee of Record of the Mortgage Loans..................11
Section 3.14. Servicer as Agent and Bailee of the Indenture Trustee.....12
Section 3.15. Investment Company Act....................................12
Section 3.16. Issuer May Not Consolidate, etc...........................12
Section 3.17. Successor or Transferee...................................14
Section 3.18. No Other Business.........................................14
Section 3.19. No Borrowing..............................................14
Section 3.20. Guarantees................................................14
Section 3.21. Capital Expenditures......................................14
Section 3.22. Indenture Trustee Not Liable for Notes or Related
Documents.................................................14
Section 3.23. Notice of Events of Default...............................15
Section 3.24. Further Instruments and Acts..............................15
Section 3.25. Statements to Noteholders.................................15
Section 3.26. Allocation of Principal Payments to the Class A Notes.....15
Section 3.27. Replacement Enhancement...................................16
Section 3.28. Allocation of Losses on the Mortgage Loans................16
Section 3.29. Additional Representations and Warranties of the Issuer...17
ARTICLE IV THE NOTES; SATISFACTION AND DISCHARGE OF INDENTURE............17
Section 4.01. The Notes.................................................17
Section 4.02. Registration of and Limitations on Transfer and
Exchange of Notes; Appointment of Certificate Registrar...19
Section 4.03. Mutilated, Destroyed, Lost or Stolen Notes................20
Section 4.04. Persons Deemed Owners.....................................21
Section 4.05. Cancellation..............................................21
Section 4.06. Book-Entry Notes..........................................22
Section 4.07. Notices to Depository.....................................22
Section 4.08. Definitive Notes..........................................23
Section 4.09. Tax Treatment.............................................23
Section 4.10. Reserved..................................................23
Section 4.11. Satisfaction and Discharge of Indenture...................23
Section 4.12. Application of Trust Money................................24
Section 4.13. Reserved..................................................24
Section 4.14. Repayment of Monies Held by Paying Agent..................24
Section 4.15. Temporary Term Notes......................................24
ARTICLE V DEFAULT AND REMEDIES...........................................25
Section 5.01. Notification of Certain Events of Default.................25
Section 5.02. Acceleration of Maturity; Rescission and Annulment........25
Section 5.03. Collection of Indebtedness and Suits for Enforcement
by Indenture Trustee......................................26
Section 5.04. Remedies; Priorities......................................28
Section 5.05. Optional Preservation of the Trust Estate.................30
Section 5.06. Limitation of Suits.......................................30
Section 5.07. Unconditional Right of Noteholders To Receive Principal
and Interest..............................................31
Section 5.08. Restoration of Rights and Remedies........................31
Section 5.09. Rights and Remedies Cumulative............................31
Section 5.10. Delay or Omission Not a Waiver............................31
Section 5.11. Control by Noteholders....................................32
Section 5.12. Waiver of Past Defaults...................................32
Section 5.13. Undertaking for Costs.....................................32
Section 5.14. Waiver of Stay or Extension Laws..........................33
Section 5.15. Sale of Trust Estate......................................33
Section 5.16. Action on Notes...........................................35
Section 5.17. Performance and Enforcement of Certain Obligations........35
ARTICLE VI THE INDENTURE TRUSTEE.........................................36
Section 6.01. Duties of Indenture Trustee...............................36
Section 6.02. Rights of Indenture Trustee...............................37
Section 6.03. Individual Rights of Indenture Trustee....................37
Section 6.04. Indenture Trustee's Disclaimer............................37
Section 6.05. Notice of Event of Default................................38
Section 6.06. Reports by Indenture Trustee to Noteholders...............38
Section 6.07. Compensation..............................................38
Section 6.08. Replacement of Indenture Trustee..........................38
Section 6.09. Successor Indenture Trustee by Merger.....................39
Section 6.10. Appointment of Co-Indenture Trustee or Separate
Indenture Trustee.........................................40
Section 6.11. Eligibility; Disqualification.............................41
Section 6.12. Preferential Collection of Claims Against Issuer..........42
Section 6.13. Representations and Warranties............................42
Section 6.14. Directions to Indenture Trustee...........................42
Section 6.15. Conflicting Instructions..................................43
ARTICLE VII NOTEHOLDERS' LISTS AND REPORTS...............................43
Section 7.01. Issuer To Furnish Indenture Trustee Names and
Addresses of Noteholders..................................43
Section 7.02. Preservation of Information; Communications to
Noteholders...............................................43
Section 7.03. Reports by Issuer.........................................43
Section 7.04. Reports by Indenture Trustee..............................44
ARTICLE VIII ACCOUNTS, DISBURSEMENTS AND RELEASES........................44
Section 8.01. Collection of Money.......................................44
Section 8.02. Reserved..................................................44
Section 8.03. Officer's Certificate.....................................44
Section 8.04. Termination Upon Distribution to Noteholders..............45
Section 8.05. Release of Trust Estate...................................45
Section 8.06. Surrender of Notes Upon Final Payment.....................45
ARTICLE IX SUPPLEMENTAL INDENTURES.......................................45
Section 9.01. Supplemental Indentures Without Consent of Noteholders....45
Section 9.02. Supplemental Indentures With Consent of Noteholders.......46
Section 9.03. Execution of Supplemental Indentures......................48
Section 9.04. Effect of Supplemental Indenture..........................48
Section 9.05. Conformity with Trust Indenture Act.......................48
Section 9.06. Reference in Notes to Supplemental Indentures.............48
ARTICLE X MISCELLANEOUS..................................................49
Section 10.01. Compliance Certificates and Opinions, etc.................49
Section 10.02. Form of Documents Delivered to Indenture Trustee..........50
Section 10.03. Acts of Noteholders.......................................51
Section 10.04. Notices...................................................52
Section 10.05. Notices to Noteholders; Waiver............................52
Section 10.06. Conflict with Trust Indenture Act.........................52
Section 10.07. Effect of Headings........................................52
Section 10.08. Successors and Assigns....................................52
Section 10.09. Severability of Provisions................................53
Section 10.10. Benefits of Indenture.....................................53
Section 10.11. Legal Holidays............................................53
Section 10.12. Governing Law.............................................53
Section 10.13. Counterparts..............................................53
Section 10.14. Recording of Indenture....................................53
Section 10.15. Issuer Obligation.........................................53
Section 10.16. No Petition...............................................54
Section 10.17. Inspection................................................54
EXHIBITS
Exhibit A-1 Form of Note...........................................A-1-1
Exhibit A-2 Form of Class A-IO Note................................A-2-1
Exhibit A-3a Form of Variable Funding Note.........................A-3a-1
Exhibit A-3b Form of Capped Variable Funding Note..................A-3b-1
Exhibit B Form of Rule 144A Investment Representation..............B-1
Exhibit C Form of Investor Representation Letter...................C-1
Exhibit D Form of Transferor Representation Letter.................D-1
This Indenture, dated as of August 31, 2001, is between Xxxxx Home Equity
Loan Trust 2001-2, a Delaware business trust, as issuer (the "Issuer"), and
Xxxxx Fargo Bank Minnesota, National Association, as trustee (the "Indenture
Trustee").
WITNESSETH:
Each party hereto agrees as follows for the benefit of the other party and
for the equal and ratable benefit of the Holders of the Issuer's Home Equity
Loan-Backed Term Notes, Series 2001-2 (the "Term Notes") and the Holders of the
Issuer's Home Equity Loan-Backed Variable Funding Notes, Series 2001-2 (the
"Variable Funding Notes" and, together with the Term Notes, the "Notes").
GRANTING CLAUSE
The Issuer hereby Grants to the Indenture Trustee at the Closing Date, as
trustee for the benefit of the Noteholders, all of the Issuer's right, title and
interest, whether now existing or hereafter created, in and to (i) the Mortgage
Loans and all Additional Balances, (ii) all funds on deposit from time to time
in the Certificate Distribution Account, the Pre-Funding Account, the Funding
Account, the Collection Account, the Trustee Collection Account, and the
Capitalized Interest Account (in each case as defined in Appendix A hereto) and
all proceeds thereof, (iii) the Interest Rate Cap Agreements, and (iv) all
present and future claims, demands, causes and choses in action in respect of
any or all of the foregoing and all payments on or under, and all proceeds of
every kind and nature whatsoever in respect of, any or all of the foregoing and
all payments on or under, and all proceeds of every kind and nature whatsoever
in the conversion thereof, voluntary or involuntary, into cash or other liquid
property, all cash proceeds, accounts, accounts receivable, notes, drafts,
acceptances, checks, deposit accounts, rights to payment of any and every kind,
and other forms of obligations and receivables, instruments and other property
that at any time constitute all or part of or are included in the proceeds of
any of the foregoing (collectively, the "Trust Estate" or the "Collateral").
The foregoing Grant is made in trust to secure the payment of principal of
and interest on, and any other amounts owing in respect of, the Notes, equally
and ratably without prejudice, priority or distinction, and to secure compliance
with the provisions of this Indenture, all as provided herein.
The Indenture Trustee, as trustee on behalf of the Noteholders,
acknowledges such Grant, accepts the trust under this Indenture in accordance
with the provisions hereof and agrees to perform its duties as Indenture Trustee
as required herein.
ARTICLE I
DEFINITIONS
Section 1.01. DEFINITIONS. For all purposes of this Indenture, except as
otherwise expressly provided herein or unless the context otherwise requires,
capitalized terms used herein that are not otherwise defined shall have the
meanings ascribed thereto in Appendix A attached hereto, which is incorporated
by reference herein.
Section 1.02. INCORPORATION BY REFERENCE OF TRUST INDENTURE ACT. Whenever
this Indenture refers to a provision of the Trust Indenture Act of 1940, as
amended (the "TIA"), such provision is incorporated by reference in and made a
part of this Indenture. The following TIA terms used in this Indenture have the
following meanings:
"Commission" means the Securities and Exchange Commission.
"indenture securities" means the Notes.
"indenture security holder" means a Noteholder.
"indenture to be qualified" means this Indenture.
"indenture trustee" or "institutional trustee" means the Indenture Trustee.
"obligor" on the indenture securities means the Issuer and any other
obligor on the indenture securities.
All other TIA terms used in this Indenture that are defined by the TIA,
defined by TIA reference to another statute or defined by Commission rule have
the meanings assigned to them by such definitions.
Section 1.03. RULES OF CONSTRUCTION. Unless the context otherwise requires,
(i) a term has the meaning assigned to it; (ii) an accounting term not otherwise
defined has the meaning assigned to it in accordance with generally accepted
accounting principles as in effect from time to time; (iii) "or" includes
"and/or"; (iv) "including" means including without limitation; (v) words in the
singular include the plural and words in the plural include the singular; (vi)
the term "proceeds" has the meaning ascribed thereto in the UCC; (vii) any
agreement, instrument or statute defined or referred to herein or in any
instrument or certificate delivered in connection herewith means such agreement,
instrument or statute as from time to time amended, modified or supplemented and
includes (in the case of agreements or instruments) references to all
attachments thereto and instruments incorporated therein; and (viii) references
to a Person are also to such Person's permitted successors and assigns.
ARTICLE II
ORIGINAL ISSUANCE OF NOTES
Section 2.01. FORM. The Term Notes (other than the Class A-IO Notes), the
Class A-IO Notes, and the Variable Funding Notes, in each case together with the
Indenture Trustee's certificate of authentication, shall be in substantially the
forms set forth in Exhibit X-0, X-0 xxx X-0, respectively, with such appropriate
insertions, omissions, substitutions and other variations as are required or
permitted by this Indenture, and may have such letters, numbers or other marks
of identification and such legends or endorsements placed thereon as may,
consistently herewith, be determined by the officers executing such Notes, as
evidenced by their execution thereof. Any portion of the text of a Note may be
set forth on the reverse thereof, with an appropriate reference thereto on the
face thereof.
The Notes shall be typewritten, printed, lithographed or engraved, or
produced by any combination of such methods (with or without steel engraved
borders), all as determined by the Authorized Officers executing the same, as
evidenced by their execution thereof.
The terms of the Notes set forth in Exhibits X-0, X-0, and A-3 are part
of the terms of this Indenture.
Section 2.02. EXECUTION, AUTHENTICATION AND DELIVERY. The Notes shall be
executed on behalf of the Issuer by any of its Authorized Officers. The
signature of any such Authorized Officer on the Notes may be manual or
facsimile.
Notes bearing the manual or facsimile signature of individuals who were at
any time Authorized Officers of the Issuer shall bind the Issuer,
notwithstanding that such individuals or any of them shall have ceased to hold
such offices prior to the authentication and delivery of such Notes or did not
hold such offices at the date of such Notes.
The Indenture Trustee shall upon Issuer Request authenticate and deliver
Term Notes for original issuance in their Initial Class Note Balance or Notional
Amount as of the Cut-Off Date and Variable Funding Notes for original issuance
in an aggregate initial principal amount of zero. The aggregate Variable Funding
Balance may not exceed $25,000,000.00.
Each Note shall be dated the date of its authentication. The Notes other
than the Class A-IO Notes shall be issuable as registered Notes in minimum
initial Note Balances of $1,000 and in integral multiples of $1 in excess
thereof. The Class A-IO Notes shall be issuable as registered Notes in minimum
percentage interests of 5% and in integral multiples of 5% in excess thereof.
Each Variable Funding Note shall be initially issued with a Variable
Funding Balance of $0 or, if applicable, with a Variable Funding Balance in an
amount equal to the sum of the Additional Balance Differential for the
Collection Period relating to the Payment Date following the date of issuance of
such Variable Funding Note pursuant to Section 4.01.
No Note shall be entitled to any benefit under this Indenture or be valid
or obligatory for any purpose, unless there appears on such Note a certificate
of authentication substantially in the form provided for herein executed by the
Indenture Trustee by the manual signature of one of its authorized signatories,
and such certificate upon any Note shall be conclusive evidence, and the only
evidence, that such Note has been duly authenticated and delivered hereunder.
ARTICLE III
COVENANTS
Section 3.01.RESERVED.
Section 3.02. MAINTENANCE OF OFFICE OR AGENCY. The Issuer shall maintain an
office or agency where, subject to the satisfaction of conditions set forth
herein, Notes may be surrendered for registration of transfer or exchange, and
where notices and demands to or upon the Issuer in respect of the Notes and this
Indenture may be served. The Issuer hereby initially appoints the Indenture
Trustee to serve as its agent for the foregoing purposes. If at any time the
Issuer shall fail to maintain any such office or agency or shall fail to furnish
the Indenture Trustee with the address thereof, such surrenders, notices and
demands may be made or served at the Corporate Trust Office of the Indenture
Trustee, and the Issuer hereby appoints the Indenture Trustee as its agent to
receive all such surrenders, notices and demands.
Section 3.03. MONEY FOR PAYMENTS TO BE HELD IN TRUST; PAYING AGENT. All
payments of amounts due and payable with respect to any Notes pursuant to
Section 3.05 shall be made on behalf of the Issuer by the Indenture Trustee or
the Paying Agent, and no amounts shall be paid to the Issuer except as provided
in this Section. The Indenture Trustee shall initially be the Paying Agent.
The Issuer shall cause each Paying Agent (other than the Indenture Trustee)
to execute and deliver to the Indenture Trustee an instrument in which such
Paying Agent shall agree with the Indenture Trustee (and as Paying Agent, the
Indenture Trustee hereby so agrees), subject to the provisions of this Section,
that such Paying Agent will:
(a) hold all sums held by it for the payment of amounts due with respect to
the Notes in trust for the benefit of the Persons entitled thereto until such
sums shall be paid to such Persons or otherwise disposed of as herein provided
and pay such sums to such Persons as herein provided;
(b) give the Indenture Trustee written notice of any default by the Issuer
of which it has actual knowledge in the making of any payment required to be
made with respect to the Notes;
(c) at any time during the continuance of any such default, upon the
written request of the Indenture Trustee, forthwith pay to the Indenture Trustee
all sums so held in trust by such Paying Agent;
(d) immediately resign as Paying Agent and forthwith pay to the Indenture
Trustee all sums held by it in trust for payments in respect of the Notes if at
any time it ceases to meet the standards required to be met by a Paying Agent at
the time of its appointment;
(e) comply with all requirements of the Code with respect to the
withholding from any payments made by it on any Notes of any applicable
withholding taxes imposed thereon and with respect to any applicable reporting
requirements in connection therewith; and
(f) deliver to the Indenture Trustee a copy of the statement to Noteholders
prepared with respect to each Payment Date pursuant to Section 4.01 of the Sale
and Servicing Agreement.
The Issuer may at any time, for the purpose of obtaining the satisfaction
and discharge of this Indenture or for any other purpose, by Issuer Request
direct any Paying Agent to pay to the Indenture Trustee all sums held in trust
by such Paying Agent, such sums to be held by the Indenture Trustee upon the
same trusts as those upon which such sums were held by such Paying Agent; and
upon such payment by any Paying Agent to the Indenture Trustee, such Paying
Agent shall be released from all further liability with respect to such money.
Subject to applicable laws with respect to escheat of funds, any money held
by the Indenture Trustee or any Paying Agent in trust for the payment of any
amount due with respect to any Note and remaining unclaimed for one year after
such amount has become due and payable shall be discharged from such trust and
be paid to the Issuer on Issuer Request; and the Holder of such Note shall
thereafter, as an unsecured general creditor, look only to the Issuer for
payment thereof (but only to the extent of the amounts so paid to the Issuer),
and all liability of the Indenture Trustee or such Paying Agent with respect to
such trust money shall thereupon cease; provided, however, that the Indenture
Trustee or such Paying Agent, before being required to make any such repayment,
shall at the expense and direction of the Issuer cause to be published once, in
an Authorized Newspaper, notice that such money remains unclaimed and that,
after a date specified therein, which shall not be less than 30 days from the
date of such publication, any unclaimed balance of such money then remaining
will be repaid to the Issuer. The Indenture Trustee may also adopt and employ,
at the expense and direction of the Issuer, any other reasonable means of
notification of such repayment (including mailing notice of such repayment to
Holders the Notes of which have been called but have not been surrendered for
redemption or the right of which to or interest in monies due and payable but
not claimed is determinable from the records of the Indenture Trustee or any
Paying Agent, at the last address of record for each such Holder).
Section 3.04. EXISTENCE. The Issuer shall keep in full force and effect its
existence, rights and franchises as a business trust under the laws of the State
of Delaware (unless it becomes, or any successor Issuer hereunder is or becomes,
organized under the laws of any other State or of the United States of America,
in which case the Issuer shall keep in full effect its existence, rights and
franchises under the laws of such other jurisdiction) and shall obtain and
preserve its qualification to do business in each jurisdiction in which such
qualification is or shall be necessary to protect the validity and
enforceability of this Indenture, the Notes, the Mortgage Loans and each other
instrument or agreement included in the Trust Estate.
Section 3.05. PAYMENT OF PRINCIPAL AND INTEREST; DEFAULTED INTEREST.
(a) On each Payment Date (other than a Payment Date after an Event of
Default and an acceleration of the Notes), from amounts on deposit in the
Trustee Collection Account (after the Indenture Trustee has removed any
investment earnings to be retained by it pursuant to Section 6.07), the
Indenture Trustee shall apply the following amounts in the following order of
priority, in accordance with the Servicing Certificate:
(i) FIRST, to pay any prepayment penalties collected on the Mortgage
Loans during the immediately preceding Collection Period to the holders of
the Certificates;
(ii) SECOND, for any Payment Date up to and including the March 2004
Payment Date, an amount equal to $128,900 to the Interest Rate Cap
Counterparty;
(iii) THIRD, to pay accrued and unpaid interest due on the Note
Balances of the Notes at the respective Note Rates as follows:
(a) first, to the Class A Notes and the Class A-IO Notes, on a
pro rata basis in accordance with the amount of accrued interest
due thereon;
(b) second, to the Class M-1 Notes;
(c) third, to the Class M-2 Notes; and
(d) fourth, to the Class B-1 Notes;
(iv) FOURTH, to pay as principal on the Notes (other than the Class
A-IO Notes), in an amount equal to the Principal Collection Distribution
Amount for that Payment Date as follows:
(a) first, to the Class A Notes, in the order described in
Section 3.26, the amount necessary to reduce the aggregate Note
Balance of the Class A Notes to the Class A Optimal Principal
Balance;
(b) second, to the Class M-1 Notes, the amount necessary to
reduce the Note Balance of the Class M-1 Notes to the Class M-1
Optimal Principal Balance;
(c) third, to the Class M-2 Notes, the amount necessary to reduce
the Note Balance of the Class M-2 Notes to the Class M-2 Optimal
Principal Balance; and
(d) fourth, to the Class B-1 Notes, the amount necessary to
reduce the Note Balance of the Class B-1 Notes to the Class B-1
Optimal Principal Balance;
(v) FIFTH, to pay to the Class A Notes, in the order described in
Section 3.26, until the aggregate Note Balance of the Class A Notes has
been reduced to the Class A Optimal Principal Balance, an amount equal to
any Liquidation Loss Amounts incurred on the Mortgage Loans during the
related Collection Period, and any Liquidation Loss Amounts allocated to
the Class A Notes on any previous Payment Date and not previously paid,
plus interest on any previously unpaid amount;
(vi) SIXTH, to pay to the Class M-1 Notes, until the Note Balance of
the Class M-1 Notes has been reduced to the Class M-1 Optimal Note Balance,
an amount equal to any Liquidation Loss Amounts incurred on the Mortgage
Loans during the related Collection Period and not paid to the holders of
the Class A Notes under clause (v) above, and any Liquidation Loss Amounts
allocated to the Class M-1 Notes on any previous Payment Date and not
previously paid, plus interest on any previously unpaid amount;
(vii) SEVENTH, to pay to the Class M-2 Notes, until the Note Balance
of the Class M-2 Notes has been reduced to the Class M-2 Optimal Principal
Balance, an amount equal to any Liquidation Loss Amounts incurred on the
Mortgage Loans during the related Collection Period and not paid to the
holders of the Class A Notes under clause (v) above or the Class M-1 Notes
under clause (vi) above, and any Liquidation Loss Amounts allocated to the
Class M-2 Notes on any previous Payment Date and not previously paid, plus
interest on any previously unpaid amount;
(viii) EIGHTH, to pay to the Class B-1 Notes, until the Note Balance
of the Class B-1 Notes has been reduced to the Class B-1 Optimal Principal
Balance, an amount equal to any Liquidation Loss Amounts incurred on the
Mortgage Loans during the related Collection Period and not paid to the
holders of the Class A Notes under clause (v) above, the Class M- 1 Notes
under clause (vi) above or the Class M-2 Notes under clause (vii) above,
and any Liquidation Loss Amounts allocated to the Class B-1 Notes on any
previous Payment Date and not previously paid, plus interest on any
previously unpaid amount;
(ix) NINTH, to pay to the Class A Notes to reduce the aggregate Note
Balance of the Class A Notes to the Class A Optimal Principal Balance, in
the order described in Section 3.26, an amount equal to any
Overcollateralization Increase Amount;
(x) TENTH, to pay to the Class M-1 Notes, to reduce the Note Balance
of the Class M-1 Notes to the Class M-1 Optimal Principal Balance, an
amount equal to any Overcollateralization Increase Amount, to the extent
not previously distributed to the Class A Notes pursuant to clause (ix)
above;
(xi) ELEVENTH, to pay to the Class M-2 Notes, to reduce the Note
Balance of the Class M-2 Notes to the Class M-2 Optimal Principal Balance,
an amount equal to any Overcollateralization Increase Amount, to the extent
not previously distributed to the Class A Notes pursuant to clause (ix)
above or the Class M-1 Notes pursuant to clause (x) above,;
(xii) TWELFTH, to pay to the Class B-1 Notes, to reduce the Note
Balance of the Class B-1 Notes to the Class B-1 Optimal Principal Balance,
an amount equal to any Overcollateralization Increase Amount, to the extent
not previously distributed to the Class A Notes pursuant to clause (ix)
above, the Class M-1 Notes pursuant to clause (x) above or the Class M-2
Notes pursuant to clause (xi) above;
(xiii) THIRTEENTH, to pay the Indenture Trustee and the Administrator
any unpaid expenses and other reimbursable amounts owed to the Indenture
Trustee pursuant to Section 3.17 of the Sale and Servicing Agreement,
Section 6.07 hereof and Section 4 of the Administration Agreement to the
extent remaining unpaid;
(xiv) FOURTEENTH, to pay the holders of the Class IIIA-1 Notes and the
Variable Funding Notes, pro rata, any unpaid related Interest Carry-Forward
Amounts, together with interest thereon;
(xv) FIFTEENTH, to pay the holders of the Class M-1 Notes any unpaid
related Interest Carry-Forward Amounts, together with interest thereon;
(xvi) SIXTEENTH, to pay the holders of the Class M-2 Notes any related
unpaid Interest Carry-Forward Amounts, together with interest thereon;
(xvii) SEVENTEENTH, to pay the holders of the Class B-1 Notes any
related unpaid Interest Carry-Forward Amounts, together with interest
thereon; and
(xviii) EIGHTEENTH, any remaining amounts to the holders of the
Certificates.
Notwithstanding the foregoing, on the Legal Final Payment Date for a Class
of Notes, the amounts to be paid pursuant to clause (iv) above shall be equal to
the aggregate of the Term Note Balances plus the Variable Funding Balance
immediately prior to such Payment Date for all Notes with a Legal Final Payment
Date on such Payment Date.
In the event that any withholding tax is imposed on distributions (or
allocations of income) to a Holder of a Certificate, such tax shall reduce the
amount otherwise distributable to such Holder in accordance with this Section
3.05. The Indenture Trustee is hereby authorized and directed to retain or cause
to be retained from amounts otherwise distributable to the Holders of the
Certificates sufficient funds for the payment of any tax that is legally owed by
the Issuer; provided, that such authorization shall not prevent the Indenture
Trustee from contesting any such tax in appropriate Proceedings and withholding
payment thereof, if permitted by law, pending the outcome of such Proceedings.
The amount of any withholding tax imposed with respect to a Holder of a
Certificate shall be treated as cash distributed to such Holder at the time it
is withheld by the Indenture Trustee and remitted to the appropriate taxing
authority. If there is a possibility that withholding tax is payable with
respect to a distribution (such as a distribution to a non-U.S. Holder of a
Certificate), the Indenture Trustee may in its sole discretion withhold such
amounts in accordance with this paragraph.
Amounts paid to Noteholders shall be paid in respect of the Term Notes or
Variable Funding Notes, as the case may be, in accordance with the applicable
percentage as set forth in paragraph (b) below. Any installment of interest or
principal payable on any Note that is punctually paid or duly provided for by
the Issuer on the applicable Payment Date shall be paid to the Holder of record
thereof on the immediately preceding Record Date by check or money order mailed
to the address of such Noteholder reflected in the Note Register (or upon the
request of a Holder owning Notes with a principal amount or notional balance of
at least $1,000,000, by wire transfer to an account specified in writing by such
Holder reasonably satisfactory to the Indenture Trustee), in the amount required
to be distributed to such Holder on such Payment Date pursuant to such Holder's
Notes; provided, that the Indenture Trustee shall not pay to any such Holder any
amounts required to be withheld from a payment to such Holder by the Code.
(b) Principal of each Note shall be due and payable in full on the Legal
Final Payment Date for the related Class of Notes as provided in the applicable
form of Note set forth in Exhibits X-0, X-0 and A-3. All principal payments on
the Term Notes and the Variable Funding Notes shall be made pro rata to the
Class of Noteholders entitled thereto in accordance with the related Percentage
Interests represented thereby. Upon written notice to the Indenture Trustee by
the Issuer, the Indenture Trustee shall notify the Person in the name of which a
Note is registered at the close of business on the Record Date preceding the
related Legal Final Payment Date. Such notice shall be mailed no later than five
Business Days prior to the related Legal Final Payment Date and shall specify
that payment of the principal amount and any interest due with respect to such
Note at the related Legal Final Payment Date will be payable only upon
presentation and surrender of such Note, and shall specify the place where such
Note may be presented and surrendered for such final payment.
Section 3.06. PROTECTION OF TRUST ESTATE.
(a) The Issuer shall from time to time execute and deliver all such
supplements and amendments hereto and all such financing statements,
continuation statements, instruments of further assurance and other instruments,
and shall take such other action necessary or advisable to:
(i) maintain or preserve the lien and security interest (and the
priority thereof) of this Indenture or carry out more effectively the
purposes hereof;
(ii) perfect, publish notice of or protect the validity of any Grant
made or to be made by this Indenture;
(iii) cause the Trust to enforce any of the Mortgage Loans; or
(iv) preserve and defend title to the Trust Estate and the rights of
the Indenture Trustee and the Noteholders therein against the claims of all
Persons and parties.
(b) Except as otherwise provided in this Indenture, the Indenture Trustee
shall not remove any portion of the Trust Estate that consists of money or that
is evidenced by an instrument, certificate or other writing from the
jurisdiction in which it was held at the date of the most recent Opinion of
Counsel delivered pursuant to Section 3.07 (or from the jurisdiction in which it
was held as described in the Opinion of Counsel delivered at the Closing Date
pursuant to Section 3.07(a), if no Opinion of Counsel shall have yet been
delivered pursuant to Section 3.07(b)), unless the Indenture Trustee shall have
first received an Opinion of Counsel to the effect that the Lien and security
interest created by this Indenture with respect to such property will continue
to be maintained after giving effect to such action or actions.
The Issuer hereby designates the Indenture Trustee its agent and
attorney-in-fact to execute any financing statement, continuation statement or
other instrument required to be executed pursuant to this Section.
Section 3.07. OPINIONS AS TO TRUST ESTATE.
(a) On the Closing Date, the Issuer shall furnish to the Indenture Trustee,
and the Owner Trustee an Opinion of Counsel, at the expense of the Issuer,
stating that (i) in the opinion of such counsel, such action has been taken with
respect to the recording and filing of this Indenture, any indentures
supplemental hereto and any other requisite documents, and with respect to the
execution and filing of any financing statements and continuation statements, as
are necessary to perfect and make effective the Lien and security interest in
the Mortgage Loans and reciting the details of such action, or (ii) in the
opinion of such counsel, no such action is necessary to make such Lien and
security interest effective.
(b) On or before December 31st of each calendar year, commencing in 2003,
the Issuer shall furnish to the Indenture Trustee an Opinion of Counsel at the
expense of the Issuer stating that (i) in the opinion of such counsel, such
action has been taken with respect to the recording, filing, re-recording and
re-filing of this Indenture, any indentures supplemental hereto and any other
requisite documents and with respect to the execution and filing of any
financing statements and continuation statements as is necessary to maintain the
Lien and security interest in the Mortgage Loans and reciting the details of
such action or (ii) in the opinion of such counsel, no such action is necessary
to maintain such Lien and security interest. Such Opinion of Counsel shall also
describe the recording, filing, re-recording and re-filing of this Indenture,
any indentures supplemental hereto and any other requisite documents, and the
execution and filing of any financing statements and continuation statements
that will, in the opinion of such counsel, be required to maintain the Lien and
security interest in the Mortgage Loans until December 31 of the following
calendar year.
Section 3.08. PERFORMANCE OF OBLIGATIONS; SALE AND SERVICING AGREEMENT.
(a) The Issuer shall punctually perform and observe all of its obligations
and agreements contained in this Indenture, the other Basic Documents and the
instruments and agreements included in the Trust Estate.
(b) The Issuer may contract with other Persons to assist it in performing
its duties under this Indenture, and any performance of such duties by a Person
identified to the Indenture Trustee in an Officer's Certificate of the Issuer
shall be deemed to be action taken by the Issuer.
(c) The Issuer shall not take any action or permit any action to be taken
by others that would release any Person from any of such Person's covenants or
obligations under any document relating to the Mortgage Loans (including the
Mortgage Documents and the Related Documents) or under any instrument included
in the Trust Estate, or that would result in the amendment, hypothecation,
subordination, termination or discharge of, or impair the validity or
effectiveness of, any such document or any such instrument, except such actions
as the Master Servicer is expressly permitted to take in the Sale and Servicing
Agreement.
(d) The Issuer may enter into contracts with other Persons for the
performance of the Issuer's obligations hereunder, and performance of such
obligations by such Persons shall be deemed to be performance of such
obligations by the Issuer.
Section 3.09. NEGATIVE COVENANTS. So long as any Notes are Outstanding, the
Issuer shall not:
(a) except as expressly permitted by this Indenture, sell, transfer,
exchange or otherwise dispose of the Trust Estate, unless directed to do so by
the Indenture Trustee;
(b) claim any credit on or make any deduction from the principal or
interest payable in respect of the Notes (other than amounts properly withheld
from such payments under the Code) or assert any claim against any present or
former Noteholder by reason of the payment of the taxes levied or assessed upon
any part of the Trust Estate;
(c) permit the validity or effectiveness of this Indenture to be impaired,
or permit the Lien of this Indenture to be amended, hypothecated, subordinated,
terminated or discharged, or permit any Person to be released from any covenants
or obligations with respect to the Notes under this Indenture, except as may be
expressly permitted hereby, permit any Lien (other than the Lien of this
Indenture) to be created on or extend to or otherwise arise upon or burden the
Trust Estate, any part thereof, any interest therein or any proceeds thereof or
permit the Lien of this Indenture not to constitute a valid first priority
security interest in the Trust Estate; or
(d) impair or cause to be impaired the Issuer's interest in the Mortgage
Loans, the Mortgage Loan Sale Agreement or in any other Basic Document, if any
such action would materially and adversely affect the interests of the
Noteholders.
Section 3.10. ANNUAL STATEMENT AS TO COMPLIANCE. The Issuer shall deliver
to the Indenture Trustee, on or before May 31 of each year (commencing with
2003), an Officer's Certificate stating, as to the Authorized Officer signing
such Officer's Certificate, that:
(a) a review of the activities of the Issuer during such year (or from the
Closing Date in the case of the first such Certificate) and of its performance
under this Indenture and the Trust Agreement has been made under such Authorized
Officer's supervision; and
(b) to the best of such Authorized Officer's knowledge, based on such
review, the Issuer has complied with all conditions and covenants under this
Indenture and the Trust Agreement throughout such year (or from the Closing Date
in the case of the first such Certificate) or, if there has been a default in
its compliance with any such condition or covenant, specifying each such default
known to such Authorized Officer and the nature and status thereof.
Section 3.11. RECORDATION OF ASSIGNMENTS. The Issuer shall enforce the
obligation of the Transferor under Section 3.13 of the Sale and Servicing
Agreement to submit or cause to be submitted for recording Assignments of
Mortgages in accordance with such Section.
Section 3.12. REPRESENTATIONS AND WARRANTIES CONCERNING THE MORTGAGE LOANS.
The Indenture Trustee, as pledgee of the Mortgage Loans shall have the benefit
of the representations and warranties of the Transferor in Sections 3.01 and
3.02 of the Purchase Agreement and as incorporated by reference in Section 2.08
of the Sale and Servicing Agreement concerning the Mortgage Loans and the right
to enforce the remedies against the Transferor provided in such Sections to the
same extent as though such representations and warranties were made directly to
the Indenture Trustee.
Section 3.13. ASSIGNEE OF RECORD OF THE MORTGAGE LOANS. As pledgee of the
Mortgage Loans, the Indenture Trustee shall hold record title to the Mortgage
Loans by being named as payee in the endorsements of the Mortgage Notes and
assignee in the Assignments of Mortgage recorded to the extent required by
Section 3.13 of the Sale and Servicing Agreement. Except as expressly provided
in the Mortgage Loan Sale Agreement, Purchase and Sale Agreement or the Sale and
Servicing Agreement with respect to any Mortgage Loan, the Indenture Trustee
shall not execute any endorsement or assignment or otherwise release or transfer
record title to such Mortgage Loan until such time as the remaining Trust
Estate, or any portion thereof, may be released pursuant to Section 8.05 hereof.
Section 3.14. SERVICER AS AGENT AND BAILEE OF THE INDENTURE TRUSTEE. Solely
for purposes of perfection under Section 9-313 of the UCC or other similar
applicable law, rule or regulation of the State in which such property is held
by the Master Servicer, the Indenture Trustee hereby acknowledges that the
Master Servicer is acting as agent and bailee of the Indenture Trustee in
holding amounts on deposit in the Collection Account pursuant to Section 5.02
and Section 3.04 of the Sale and Servicing Agreement that are allocable to the
Mortgage Loans, as well as the agent and bailee of the Indenture Trustee in
holding any Related Documents released to the Master Servicer pursuant to
Section 3.09 of the Sale and Servicing Agreement, and any other items
constituting a part of the Trust Estate that from time to time come into the
possession of the Master Servicer. It is intended that, by the Master Servicer's
acceptance of such agency pursuant to Section 3.01 of the Sale and Servicing
Agreement, the Indenture Trustee, as pledgee of the Mortgage Loans, will be
deemed to have possession of such Related Documents, such monies and such other
items for purposes of Section 9-313 of the UCC of the State in which such
property is held by the Master Servicer.
Section 3.15. INVESTMENT COMPANY ACT. The Issuer shall not become an
"investment company" or under the "control" of an "investment company" as such
terms are defined in the Investment Company Act of 1940, as amended, and the
rules and regulations thereunder (taking into account not only the general
definition of the term "investment company" but also any available exceptions to
such general definition); provided, that the Issuer shall be in compliance with
this Section if it shall have obtained an order exempting it from regulation as
an "investment company" so long as it is in compliance with the conditions
imposed in such order.
Section 3.16. ISSUER MAY NOT CONSOLIDATE, ETC.
(a) The Issuer shall not consolidate or merge with or into any other
Person, unless:
(i) the Person (if other than the Issuer) formed by or surviving such
consolidation or merger shall be a Person organized and existing under the
laws of the United States of America or any State, and shall expressly
assume, by an indenture supplemental hereto, executed and delivered to the
Indenture Trustee, in form reasonably satisfactory to the Indenture
Trustee, the due and punctual payment of the principal of and interest on
the Notes, and to the Certificate Paying Agent, on behalf of the
Certificateholders, and the performance or observance of every agreement
and covenant of this Indenture on the part of the Issuer to be performed or
observed, all as provided herein;
(ii) immediately after giving effect to such transaction, no Event of
Default shall have occurred and be continuing;
(iii) no Rating Agency, after prior written notice thereto, shall have
notified the Issuer that such transaction will result in a Rating Event;
(iv) the Issuer shall have received an Opinion of Counsel (and shall
have delivered a copy thereof to the Indenture Trustee) to the effect that
such transaction will not have any material adverse tax consequence to the
Issuer, any Noteholder or any Certificateholder;
(v) any action that is necessary to maintain the Lien and security
interest created by this Indenture shall have been taken; and
(vi) the Issuer shall have delivered to the Indenture Trustee an
Officer's Certificate and an Opinion of Counsel each stating that such
consolidation or merger and such supplemental indenture comply with this
Article and that all conditions precedent herein provided for relating to
such transaction have been complied with (including any filing required by
the Exchange Act).
(b) The Issuer shall not convey or transfer any of its properties or
assets, including those included in the Trust Estate, to any Person, unless:
(i) the Person that acquires by conveyance or transfer the properties
and assets of the Issuer the conveyance or transfer of which is hereby
restricted shall (A) be a United States citizen or a Person organized and
existing under the laws of the United States of America or any State, (B)
expressly assume, by an indenture supplemental hereto, executed and
delivered to the Indenture Trustee, in form satisfactory to the Indenture
Trustee, the due and punctual payment of the principal of and interest on
all Notes and the performance or observance of every agreement and covenant
of this Indenture on the part of the Issuer to be performed or observed,
all as provided herein, (C) expressly agree by means of such supplemental
indenture that all right, title and interest so conveyed or transferred
shall be subject and subordinate to the rights of the Noteholders, (D)
unless otherwise provided in such supplemental indenture, expressly agree
to indemnify, defend and hold harmless the Issuer from and against any
loss, liability or expense arising under or relating to this Indenture or
the Notes and (E) expressly agree by means of such supplemental indenture
that such Person (or if a group of Persons, then one specified Person)
shall make all filings with the Commission (and any other appropriate
Person) required by the Exchange Act in connection with the Notes;
(ii) immediately after giving effect to such transaction, no Default
or Event of Default shall have occurred and be continuing;
(iii) no Rating Agency, after prior written notice thereto, shall have
notified the Issuer that such transaction will cause a Rating Event;
(iv) the Issuer shall have received an Opinion of Counsel (and shall
have delivered copies thereof to the Indenture Trustee) to the effect that
such transaction will not have any material adverse tax consequence to the
Issuer or any Senior Noteholder;
(v) any action that is necessary to maintain the Lien and security
interest created by this Indenture shall have been taken; and
(vi) the Issuer shall have delivered to the Indenture Trustee an
Officer's Certificate and an Opinion of Counsel each stating that such
conveyance or transfer and such supplemental indenture comply with this
Article and that all conditions precedent herein provided for relating to
such transaction have been complied with (including any filing required by
the Exchange Act).
Section 3.17. SUCCESSOR OR TRANSFEREE.
(a) Upon any consolidation or merger of the Issuer in accordance with
Section 3.16(a), the Person formed by or surviving such consolidation or merger
(if other than the Issuer) shall succeed to, and be substituted for, and may
exercise every right and power of, the Issuer under this Indenture with the same
effect as if such Person had been named as the Issuer herein.
(b) Upon a conveyance or transfer of all the assets and properties of the
Issuer pursuant to Section 3.16(b), the Issuer will be released from every
covenant and agreement of this Indenture to be observed or performed on the part
of the Issuer with respect to the Notes immediately upon the delivery of written
notice to the Indenture Trustee of such conveyance or transfer.
Section 3.18. NO OTHER BUSINESS. The Issuer shall not engage in any
business other than financing, purchasing, owning and selling and managing the
Mortgage Loans, the issuance of the Notes and the Certificate in the manner
contemplated by this Indenture and the other Basic Documents and all activities
incidental thereto.
Section 3.19. NO BORROWING. The Issuer shall not issue, incur, assume,
guarantee or otherwise become liable, directly or indirectly, for any
indebtedness, except for the Notes.
Section 3.20. GUARANTEES. Except as contemplated by this Indenture or the
other Basic Documents, the Issuer shall not make any loan or advance or credit
to, or guarantee (directly or indirectly or by an instrument having the effect
of assuring another's payment or performance on any obligation or capability of
so doing or otherwise), endorse or otherwise become contingently liable,
directly or indirectly, in connection with the obligations, stocks or dividends
of, or own, purchase, repurchase or acquire (or agree contingently to do so) any
stock, obligations, assets or securities of, or any other interest in, or make
any capital contribution to, any Person.
Section 3.21. CAPITAL EXPENDITURES. The Issuer shall not make any
expenditure (by long-term or operating lease or otherwise) for capital assets
(either realty or personalty).
Section 3.22. INDENTURE TRUSTEE NOT LIABLE FOR NOTES OR RELATED DOCUMENTS.
The recitals contained herein shall be taken as the statements of the Depositor,
and the Indenture Trustee assumes no responsibility for the correctness thereof.
The Indenture Trustee makes no representations as to the validity or sufficiency
of this Indenture, of any other Basic Document or of the Notes (other than the
signatures of the Indenture Trustee on the authentication of the Notes) or of
any other documents relating thereto. The Indenture Trustee shall at no time
have any responsibility or liability with respect to the sufficiency of the
Trust Estate or its ability to generate the payments to be distributed to the
Noteholders under this Indenture, including the compliance by the Depositor or
the Transferor with any representation or warranty made under any Basic Document
or in any related document or the accuracy of any such representation or
warranty, or any action of the Paying Agent or the Note Registrar or the
Indenture Trustee taken in the name of the Owner Trustee.
Section 3.23. NOTICE OF EVENTS OF DEFAULT. The Issuer shall give the
Indenture Trustee and each Rating Agency prompt written notice of each Event of
Default hereunder. Section 3.24. FURTHER INSTRUMENTS AND ACTS. Upon request of
the Indenture Trustee, the Issuer shall execute and deliver such further
instruments and do such further acts as may be reasonably necessary or proper to
carry out more effectively the purpose of this Indenture.
Section 3.25. STATEMENTS TO NOTEHOLDERS. On each Payment Date, the
Indenture Trustee will make the Servicing Certificate (and, at its option, any
additional files containing the same information in alternative format)
available to Noteholders via the Indenture Trustee's internet website. The
Indenture Trustee's internet website shall initially be located at
xxx.xxxxxxx.xxx. Assistance in using the website can be obtained by calling the
Trustee's customer service desk at (000) 000-0000. Persons that are unable to
use the above distribution options are entitled to have a paper copy mailed to
them via first class mail by calling the customer service desk and indicating
such. The Indenture Trustee shall have the right to change the way Servicing
Certificates are distributed in order to make such distribution more convenient
and/or more accessible to the above Persons, and the Indenture Trustee shall
provide timely and adequate notification to all above Persons regarding any such
changes.
Section 3.26. ALLOCATION OF PRINCIPAL PAYMENTS TO THE CLASS A NOTES. (a)
Payments made to the holders of the Class A Notes on each Payment Date with
respect to the Principal Collection Distribution Amount, the Liquidation Loss
Amount and the Overcollateralization Increase Amount shall be distributed
concurrently to (a) the Group I Notes in the aggregate, (b) the Group II Notes
in the aggregate and (c) the Group III Notes in the aggregate, in each case in
proportion to the quotient of the Net Principal Collections derived from the
related Group (with respect to which any related Notes are outstanding) divided
by the Net Principal Collections for all Groups in each case for that Payment
Date, until the Note Balances of the Group I Notes in the aggregate, the Group
II Notes in the aggregate and the Group III Notes in the aggregate have been
reduced to zero.
(b) After any of the Group I Notes in the aggregate, the Group II Notes in
the aggregate or the Group III Notes in the aggregate are reduced to zero, the
Principal Collection Distribution Amount, Liquidation Loss Amount and the
Overcollateralization Increase Amount allocated to the Class A Notes will be
distributed to the Class A Notes of the Note Groups with Class A Notes still
outstanding pro rata in proportion to the quotient of the Net Principal
Collections derived from each Group backing each Note Group with Class A Notes
still outstanding divided by the Net Principal Collections for all Groups
backing Note Groups with Class A Notes still outstanding until the Note Balances
of the Group I Notes in the aggregate, the Group II Notes in the aggregate and
the Group III Notes in the aggregate have been reduced to zero.
(c) Payments of principal that are allocated to the Group I Notes or the
Group II Notes will be paid sequentially (commencing with the Class IA-1 Notes
and the Class IIA-1 Notes, as applicable until the Note Balance of such Class
has been reduced to zero) within the respective Note Group. Payments of
principal that are allocated to the Group III Notes will be paid to the Class
IIIA-1 Notes and the Variable Funding Notes pro rata based on the outstanding
Note Balance or Variable Funding Balance, as applicable, thereof until paid in
full.
Section 3.27. REPLACEMENT ENHANCEMENT. The Issuer (or the Master Servicer
on its behalf) may, at its expense, in accordance with and upon satisfaction of
the conditions set forth herein, but shall not be required to, obtain a surety
bond, letter of credit or guaranty as a Permitted Investment for amounts on
deposit in the Capitalized Interest Account, as the case may be, or may arrange
for any other form of additional credit enhancement; provided, that after prior
notice thereto, no Rating Agency shall have informed the Issuer that a Rating
Event would occur as a result thereof, and provided that the timing and
mechanism for drawing on such additional enhancement shall be reasonably
acceptable to the Indenture Trustee. It shall be a condition to procurement of
any such additional credit enhancement that there be delivered to the Indenture
Trustee (a) an Opinion of Counsel, acceptable in form to the Indenture Trustee,
from counsel to the provider of such additional credit enhancement with respect
to the enforceability thereof and such other matters as the Indenture Trustee
may require and (b) an Opinion of Counsel to the effect that the procurement of
such additional enhancement would not (i) adversely affect in any material
respect the tax status of the Notes or the Certificate or (ii) cause the Issuer
to be taxable as an association (or a publicly traded partnership) for federal
income tax purposes or to be classified as a taxable mortgage pool. within the
meaning of Section 7701(i) of the Code.
Section 3.28. ALLOCATION OF LOSSES ON THE MORTGAGE LOANS. On each Payment
Date, the amount of Liquidation Loss Amounts incurred on the Mortgage Loans in
the related Collection Period that were not distributed pursuant to Sections
3.05(a)(v), (vi), (vii) or (viii) will be applied as follows: first, to reduce
any Overcollateralization Amount (after allocation of Principal Collections and
Interest Collections on the Mortgage Loans for such Payment Date) until such
amount has been reduced to zero; second, to reduce the Note Balance of the Class
B-1 Notes, until the outstanding Note Balance thereof has been reduced to zero;
third, to reduce the Note Balance of the Class M-2 Notes, until the outstanding
Note Balance thereof has been reduced to zero; fourth, to reduce the Note
Balance of the Class M-1 Notes, until the outstanding Note Balance thereof has
been reduced to zero, and last to reduce the Note Balance of the Class A Notes
until the outstanding Note Balances thereof have been reduced to zero. Any such
Liquidation Loss Amounts allocated to Class A Notes shall be allocated to the
Class A Notes, on a pro rata basis. The reduction of the Note Balance of any
Class of Notes by application of Liquidation Loss Amounts entitles such Class to
reimbursement for such amount, with interest thereon, in accordance with Section
3.05. Payment of that reimbursement amount will not further reduce the Note
Balance of the applicable Class. After the Note Balance of any Class has been
reduced to zero, that Class will no longer be entitled to reimbursement.
Section 3.29. ADDITIONAL REPRESENTATIONS AND WARRANTIES OF THE ISSUER. This
Indenture creates a valid and continuing security interest (as defined in the
applicable UCC) in the Mortgage Loans in favor of the Indenture Trustee, which
security interest is prior to all other Liens, and is enforceable as such as
against creditors of and purchasers from the Issuer. The Mortgage Loans
constitute "instruments" or "accounts" within the meaning of the applicable UCC.
The Issuer owns and has good and marketable title to the Mortgage Loans free and
clear of any Lien, claim or encumbrance of any Person. All original executed
copies of each Mortgage Note (or a "lost note affidavit" in lieu thereof) that
constitute or evidence the Initial Mortgage Loans have been delivered to the
Indenture Trustee. The Issuer has caused or will have caused, within ten days,
the filing of all appropriate financing statements in the proper filing office
in the appropriate jurisdictions under applicable law in order to perfect the
security interest in the Collateral granted to the Indenture Trustee hereunder.
Other than the security interest granted to the Indenture Trustee pursuant to
this Indenture, the Issuer has not pledged, assigned, sold, granted a security
interest in, or otherwise conveyed any of the Mortgage Loans. The Issuer has not
authorized the filing of and is not aware of any financing statements against
the Issuer that include a description of collateral covering the Mortgage Loans
other than any financing statement relating to the security interest granted to
the Indenture Trustee hereunder or that has been terminated. The Issuer is not
aware of any judgment or tax lien filings against the Issuer. None of the
Mortgage Notes that constitute or evidence the Mortgage Loans has any marks or
notations indicating that they have been pledged, assigned or otherwise conveyed
to any Person other than the Indenture Trustee. The foregoing representations
and warranties shall survive the discharge of this Indenture.
ARTICLE IV
THE NOTES; SATISFACTION AND DISCHARGE OF INDENTURE
Section 4.01. THE NOTES.
(a) The Term Notes shall be registered in the name of a nominee designated
by the Depository. Beneficial Owners shall hold interests in the Term Notes
other than the Class A-IO Notes through the book-entry facilities of the
Depository in minimum initial Note Balances of $1,000 and integral multiples of
$1 in excess thereof. Beneficial Owners shall hold interests in the Class A-IO
Notes through the book-entry facilities of the Depository in minimum initial
Percentage Interests of 5% and integral multiples of 5% in excess thereof. The
Capped Funding Notes shall be issued as physical notes in fully registered form
in minimum initial Capped Funding Balances of $10,000 and integral multiples of
$1,000 in excess thereof, together with any additional amount necessary to cover
(i) the aggregate Variable Funding Balance of the Variable Funding Notes at the
time of the denominational exchange thereof or (ii) the aggregate Capped Funding
Balance of any Capped Funding Notes issued in an exchange described in paragraph
(d) below. The Variable Funding Balance of the Variable Funding Notes at the
time of such exchange shall be the initial Capped Funding Balance of the Capped
Funding Notes issued in exchange therefor.
The Indenture Trustee may for all purposes (including the making of
payments due on the Notes) deal with the Depository as the authorized
representative of the Beneficial Owners with respect to the Term Notes for the
purposes of exercising the rights of Term Noteholders hereunder. Except as
provided in the next succeeding paragraph, the rights of Beneficial Owners with
respect to the Term Notes shall be limited to those established by law and
agreements between such Beneficial Owners and the Depository and Depository
Participants. Except as provided in Section 4.08, Beneficial Owners shall not be
entitled to definitive certificates for the Term Notes as to which they are the
Beneficial Owners. Requests and directions from, and votes of, the Depository as
Holder of the Term Notes shall not be deemed inconsistent if they are made with
respect to different Beneficial Owners. The Indenture Trustee may establish a
reasonable record date in connection with solicitations of consents from or
voting by Term Noteholders and give notice to the Depository of such Record
Date. Without the consent of the Issuer and the Indenture Trustee, the
Depository may not transfer any Term Note except to a successor Depository that
agrees to hold such Term Note for the account of the Beneficial Owners.
In the event that The Depository Trust Company resigns or is removed as
Depository, the Indenture Trustee, with the approval of the Issuer, may appoint
a successor Depository. If no successor Depository has been appointed within 30
days after the effective date of the predecessor Depository's resignation or
removal, each Beneficial Owner shall be entitled to certificates representing
the Term Notes it beneficially owns in the manner prescribed in Section 4.08.
The Owner Trustee (not in its individual capacity but solely as Owner
Trustee), shall, on original issue, execute the Term Notes on behalf of the
Issuer, and the Indenture Trustee shall authenticate and deliver the Notes to or
upon the order of the Issuer.
(b) On each Payment Date, the aggregate Variable Funding Balance of the
Variable Funding Notes shall be increased by an amount equal to the Additional
Balance Differential for such Payment Date, subject to the Maximum Variable
Funding Balance and the terms and conditions set forth below.
(c) The Variable Funding Note issued on the Closing Date shall bear the
Designation "VFN-1", and each Variable Funding Note issued thereafter shall bear
sequential numerical designations in the order of their issuance.
(d) Subject to the following conditions, the Variable Funding Notes may be
exchanged pursuant to Section 4.02 for one or more Capped Funding Notes. Prior
to any such exchange, the party requesting the exchange must provide an Opinion
of Counsel, addressed to the Issuer and the Indenture Trustee, to the effect
that the Capped Funding Notes shall qualify for federal income tax purposes as
indebtedness of the Issuer and neither the Issuer nor any portion thereof will
be characterized as a taxable mortgage pool within the meaning of Section
7701(i) of the Code. Upon receipt of the Opinion of Counsel, the Indenture
Trustee shall issue Capped Funding Notes with a Capped Funding Balance equal to
the Capped Funding Balance permitted under such Opinion of Counsel, in minimum
denominations as set forth in paragraph (a) above. The Capped Funding Notes
shall bear the designation "Capped" in addition to any other applicable
designation. The Capped Funding Notes shall be issued concurrently with a
reduction in the aggregate Variable Funding Balance. Any Variable Funding
Balance not represented by a Capped Funding Note shall result in the issuance of
a new Variable Funding Note having an initial Variable Funding Balance equal to
the excess of the outstanding Variable Funding Balance of the Variable Funding
Note so surrendered over the initial Capped Funding Balances of the Capped
Funding Notes. The Indenture Trustee and the Issuer agree to cooperate with each
other, the party requesting the exchange of Variable Funding Notes for Capped
Funding Notes and the Depositor, the Seller and the Owner Trustee, and to cause
no unreasonable delay in issuing Capped Funding Notes in connection with this
Section.
Section 4.02. REGISTRATION OF AND LIMITATIONS ON TRANSFER AND EXCHANGE OF
NOTES; APPOINTMENT OF CERTIFICATE REGISTRAR. The Issuer shall cause to be kept
at the Corporate Trust Office of the Indenture Trustee a Note Register in which,
subject to such reasonable regulations as it may prescribe, the Note Registrar
shall provide for the registration of Notes and of transfers and exchanges of
Notes as herein provided.
Subject to the restrictions and limitations set forth below, upon surrender
for registration of transfer of any Note at the Corporate Trust Office of the
Indenture Trustee, the Issuer shall execute, and the Note Registrar shall
authenticate and deliver, in the name of the designated transferee or
transferees, one or more new Notes in authorized initial Note Balances (or
Percentage Interests in the case of the Class A-IO Notes) evidencing the same
aggregate Percentage Interests.
No Variable Funding Note, other than any Capped Funding Note, may be
transferred. Subject to the provisions set forth below, Capped Funding Notes may
be transferred; provided, that with respect to the initial transfer thereof by
the Seller, prior written notification of such transfer shall have been given to
each Rating Agency by the Seller.
No transfer, sale, pledge or other disposition of a Capped Funding Note
shall be made unless such transfer, sale, pledge or other disposition is exempt
from the registration requirements of the Securities Act, and any applicable
state securities laws, or is made in accordance with the Securities Act and such
state laws. In the event of any such transfer, the Indenture Trustee or the
Issuer shall require the transferee to execute either (i) an investment letter
in substantially the form attached hereto as Exhibit B (or in such form
reasonably satisfactory to the Indenture Trustee and the Issuer), which
investment letters shall not be an expense of the Issuer, the Owner Trustee, the
Indenture Trustee or the Depositor, and which investment letter shall state
that, among other things, such transferee is a "qualified institutional buyer"
as defined under Rule 144A, acting for its own account or for the accounts of
other "qualified institutional buyers" as defined under Rule 144A, and is aware
that the proposed transferor intends to rely on the exemption from registration
requirements under the Securities Act provided by Rule 144A or (ii) a written
Opinion of Counsel (who may be in-house counsel) acceptable to and in form and
substance reasonably satisfactory to the Indenture Trustee and the Issuer that
such transfer may be made pursuant to an exemption, describing the applicable
exemption and the basis therefor, from the Securities Act and such state laws or
is being made pursuant to the Securities Act and such state laws, which Opinion
of Counsel shall not be an expense of the Issuer, the Owner Trustee, the
Indenture Trustee or the Depositor, and the Indenture Trustee shall require the
transferee to execute an investment letter in substantially the form of Exhibit
C hereto, and the transferor shall execute a representation letter,
substantially in the form of Exhibit D hereto, acceptable to and in form and
substance reasonably satisfactory to the Issuer and the Indenture Trustee
certifying to the Issuer and the Indenture Trustee the facts surrounding such
transfer, which investment letter shall not be an expense of the Indenture
Trustee or the Issuer. The Holder of a Capped Funding Note desiring to effect
such transfer shall, and does hereby agree to, indemnify the Indenture Trustee
and the Issuer against any liability that may result if the transfer is not so
exempt or is not made in accordance with such federal or state laws.
Notwithstanding the foregoing, the restriction of transfer specified in this
paragraph is not applicable to any Capped Funding Notes that have been
registered under the Securities Act.
Subject to the foregoing, at the option of the related Noteholders, Notes
may be exchanged for other Notes of like tenor and Class, in each case, in
authorized initial Note Balances (or Percentage Interests in the case of the
Class A-IO Notes) evidencing the same aggregate Percentage Interests upon
surrender of the Notes to be exchanged at the Corporate Trust Office of the
Indenture Trustee, as Note Registrar. With respect to any surrender of Capped
Funding Notes for exchange, the new Capped Funding Notes delivered in exchange
therefore shall bear the designation "Capped" in addition to any other
applicable designation. Whenever any Notes are so surrendered for exchange, the
Indenture Trustee shall execute, and the Note Registrar shall authenticate and
deliver, the Notes that the Noteholder making such exchange is entitled to
receive. Each Note presented or surrendered for registration of transfer or
exchange shall (if so required by the Note Registrar) be duly endorsed by, or
accompanied by a written instrument of transfer in form reasonably satisfactory
to the Note Registrar duly executed by the Holder thereof or his attorney duly
authorized in writing, with such signature guaranteed by a commercial bank or
trust company. Notes delivered upon any such transfer or exchange shall evidence
the same obligations, and shall be entitled to the same rights and privileges,
as the Notes surrendered.
No service charge shall be made for any registration of transfer or
exchange of any Notes, but the Note Registrar may require payment of a sum
sufficient to cover any tax or governmental charge that may be imposed in
connection with any such registration of transfer or exchange. All Notes
surrendered for registration of transfer and exchange shall be cancelled by the
Note Registrar and delivered to the Indenture Trustee for subsequent destruction
without liability on the part of either.
The Issuer hereby appoints the Indenture Trustee as Certificate Registrar
to keep at its Corporate Trust Office a Certificate Register pursuant to Section
3.08 of the Trust Agreement in which, subject to such reasonable regulations as
it may prescribe, the Certificate Registrar shall provide for the registration
of Certificates and of transfers and exchanges thereof pursuant to Section 3.04
of the Trust Agreement. The Indenture Trustee hereby accepts such appointment.
Section 4.03. MUTILATED, DESTROYED, LOST OR STOLEN NOTES. If (i) any
mutilated Note is surrendered to the Indenture Trustee, or the Indenture Trustee
receives evidence to its satisfaction of the destruction, loss or theft of any
Note, and (ii) there is delivered to the Indenture Trustee such security or
indemnity as may be required by it to hold the Issuer and the Indenture Trustee
harmless; then, in the absence of notice to the Issuer, the Note Registrar or
the Indenture Trustee that such Note has been acquired by a bona fide purchaser,
and provided that the requirements of Section 8-405 of the UCC are met, the
Issuer shall execute, and upon its request the Indenture Trustee shall
authenticate and deliver, in exchange for or in lieu of any such mutilated,
destroyed, lost or stolen Note, a replacement Note; provided, that if any such
destroyed, lost or stolen Note, but not a mutilated Note, shall be, or within
seven days shall be, due and payable, instead of issuing a replacement Note, the
Issuer may pay such destroyed, lost or stolen Note when so due or payable
without surrender thereof. If, after the delivery of a replacement Note or
payment of a destroyed, lost or stolen Note pursuant to the proviso to the
preceding sentence, a bona fide purchaser of the original Note in lieu of which
such replacement Note was issued presents for payment such original Note, the
Issuer and the Indenture Trustee shall be entitled to recover such replacement
Note or such payment from the Person to which it was delivered or any Person
taking such replacement Note from the Person to whom such replacement Note was
delivered or any assignee of such Person, except a bona fide purchaser, and
shall be entitled to recover the security or indemnity provided therefor to the
extent of any loss, damage, cost or expense incurred by the Issuer or the
Indenture Trustee in connection therewith.
Upon the issuance of any replacement Note under this Section, the Issuer
may require the payment by the related Noteholder of a sum sufficient to cover
any tax or other governmental charge that may be imposed in connection therewith
and any other reasonable related expenses (including the fees and expenses of
the Indenture Trustee).
Each replacement Note issued pursuant to this Section in replacement of any
mutilated, destroyed, lost or stolen Note shall constitute an original
additional contractual obligation of the Issuer, whether or not such mutilated,
destroyed, lost or stolen Note shall be at any time enforceable by anyone each
such replacement Note shall be entitled to all the benefits of this Indenture
equally and proportionately with any and all other Notes duly issued hereunder.
The provisions of this Section are exclusive and shall preclude, to the
extent lawful, all other rights and remedies with respect to the replacement or
payment of mutilated, destroyed, lost or stolen Notes.
Section 4.04. PERSONS DEEMED OWNERS. Prior to due presentment for
registration of transfer of any Note, the Issuer, the Indenture Trustee and any
agent of the Issuer or the Indenture Trustee may treat the Person in the name of
which such Note is registered as of the date of determination as the owner of
such Note for the purpose of receiving payments of principal and interest, if
any, on such Note and for all other purposes whatsoever, whether or not such
Note shall be overdue; and neither the Issuer, the Indenture Trustee nor any
agent of the Issuer or the Indenture Trustee shall be affected by notice to the
contrary.
Section 4.05. CANCELLATION. All Notes surrendered for payment, registration
of transfer, exchange or redemption shall, if surrendered to any Person other
than the Indenture Trustee, be delivered to the Indenture Trustee, and shall be
promptly cancelled by the Indenture Trustee. The Issuer may at any time deliver
to the Indenture Trustee for cancellation any Notes previously authenticated and
delivered hereunder that the Issuer may have acquired in any manner whatsoever,
and the Indenture Trustee shall promptly cancel all Notes so delivered. No Notes
shall be authenticated in lieu of or in exchange for any Notes cancelled as
provided in this Section, except as expressly permitted by this Indenture. All
cancelled Notes may be held or disposed of by the Indenture Trustee in
accordance with its standard retention or disposal policy as in effect at the
time of cancellation thereof, unless the Issuer directs by Issuer Request that
the same be destroyed or returned to it; provided, that such Issuer Request
shall be timely and such Notes have not been previously disposed of by the
Indenture Trustee.
Section 4.06. BOOK-ENTRY NOTES. The Term Notes, upon original issuance,
will be issued in the form of typewritten notes representing Book-Entry Notes,
to be delivered to The Depository Trust Company, the initial Depository, by or
on behalf of the Issuer. The Term Notes shall initially be registered on the
Note Register in the name of Cede & Co., the nominee of the initial Depository,
and no Beneficial Owner shall receive a Definitive Note representing such
Beneficial Owner's interest in the related Term Note, except as provided in
Section 4.08. Unless and until definitive, fully-registered Term Notes (the
"Definitive Notes") have been issued to Beneficial Owners pursuant to Section
4.08:
(a) the provisions of this Section shall be in full force and effect;
(b) the Note Registrar and the Indenture Trustee shall be entitled to deal
with the Depository for all purposes of this Indenture (including the payment of
principal of and interest on the Notes and the giving of instructions or
directions hereunder) as the sole Holder of the Term Notes, and shall have no
obligation to Beneficial Owners;
(c) to the extent that the provisions of this Section conflict with any
other provisions of this Indenture, the provisions of this Section shall
control;
(d) the rights of Beneficial Owners shall be exercised only through the
Depository, and shall be limited to those established by law and agreements
between the related Beneficial Owners and the Depository or the Depository
Participants. Unless and until Definitive Notes are issued pursuant to Section
4.08, the initial Depository shall make book-entry transfers among the
Depository Participants and receive and transmit payments of principal of and
interest on the Term Notes to such Depository Participants; and
(e) whenever this Indenture requires or permits actions to be taken based
upon instructions or directions of Holders of Notes representing a specified
percentage of the aggregate Note Balance, the Depository shall be deemed to
represent such percentage only to the extent that it has received instructions
to such effect from Beneficial Owners or Depository Participants owning or
representing, respectively, such required percentage, and has delivered such
instructions to the Indenture Trustee.
Section 4.07. NOTICES TO DEPOSITORY. Whenever a notice or other
communication to the Term Noteholders is required under this Indenture, unless
and until Definitive Notes shall have been issued to Beneficial Owners pursuant
to Section 4.08, the Indenture Trustee shall give all such notices and
communications specified herein to be given to Term Noteholders to the
Depository, and shall have no obligation to any Beneficial Owner.
Section 4.08. DEFINITIVE NOTES. If (i) the Indenture Trustee determines
that the Depository is no longer willing or able to properly discharge its
responsibilities with respect to the Term Notes and the Indenture Trustee is
unable to locate a qualified successor, (ii) the Indenture Trustee elects to
terminate the book-entry system through the Depository or (iii) after the
occurrence of an Event of Default, Beneficial Owners representing at least a
majority of the aggregate Term Note Balance advise the Depository in writing
that the continuation of a book-entry system through the Depository is no longer
in the best interests of the Beneficial Owners, then the Depository shall notify
all Beneficial Owners and the Indenture Trustee of the occurrence of such event
and of the availability of Definitive Notes to Beneficial Owners requesting the
same. Upon surrender to the Indenture Trustee of the typewritten Term Notes
representing the Book-Entry Notes by the Depository, accompanied by registration
instructions, the Issuer shall execute and the Indenture Trustee shall
authenticate Definitive Notes in accordance with the instructions of the
Depository. None of the Issuer, the Note Registrar or the Indenture Trustee
shall be liable for any delay in delivery of such instructions and may
conclusively rely on, and shall be protected in relying on, such instructions.
Upon the issuance of Definitive Notes, the Indenture Trustee shall recognize the
holders of such Definitive Notes as Term Noteholders.
Section 4.09. TAX TREATMENT. The Issuer has entered into this Indenture,
and the Notes shall be issued, with the intention that, for federal, state and
local income, single business and franchise tax purposes, the Notes will qualify
as indebtedness of the Issuer.
The Issuer, by entering into this Indenture, and each holder of a Note, by
its acceptance of a Note (and each Beneficial Owner by its acceptance of an
interest in the applicable Book-Entry Note), agree to treat the Notes for
federal, state and local income, single business and franchise tax purposes as
indebtedness of the Issuer.
Section 4.10. RESERVED.
Section 4.11. SATISFACTION AND DISCHARGE OF INDENTURE. Upon the occurrence
of the events set forth in the immediately following sentence, this Indenture
shall cease to be of further effect with respect to the Notes except as to (a)
rights of registration of transfer and exchange, (b) substitution of mutilated,
destroyed, lost or stolen Notes, (c) rights of Noteholders to receive payments
of principal thereof and interest thereon, (d) Sections 3.03, 3.04, 3.06, 3.09,
3.16, 3.18 and 3.19, (e) the rights, obligations and immunities of the Indenture
Trustee hereunder (including the rights of the Indenture Trustee under Section
6.07 and the obligations of the Indenture Trustee under Section 4.11) and (f)
the rights of Noteholders as beneficiaries hereof with respect to the property
so deposited with the Indenture Trustee payable to all or any of them. The
Indenture Trustee, upon the demand and at the expense of the Issuer, shall
execute proper instruments acknowledging the satisfaction and discharge of this
Indenture with respect to the Notes, when:
(i) either
(A) all Notes theretofore authenticated and delivered (other than
(1) Notes that have been destroyed, lost or stolen and that have been
replaced or paid as provided in Section 4.03 and (2) Notes for the
payment of which money has theretofore been deposited in trust or
segregated and held in trust by the Issuer and thereafter repaid to
the Issuer or discharged from such trust, as provided in Section 3.03)
have been delivered to the Indenture Trustee for cancellation; or
(B) all Notes not theretofore delivered to the Indenture Trustee
for cancellation (I) have become due and payable; (II) will become due
and payable at the last Legal Final Payment Date within one year (III)
or have been declared immediately due and payable pursuant to Section
5.02;
and the Issuer, in the case of (I) or (II) above, has irrevocably deposited
or caused to be irrevocably deposited with the Indenture Trustee cash or
direct obligations of or obligations guaranteed by the United States of
America that will mature prior to the date such amounts are payable, in
trust for such purpose, in an amount sufficient to pay and discharge the
entire indebtedness on the Notes then outstanding and not theretofore
delivered to the Indenture Trustee for cancellation when due on the last
Legal Final Payment Date;
(ii) the Issuer has delivered to the Indenture Trustee an Officer's
Certificate and an Opinion of Counsel, each meeting the applicable
requirements of Section 10.01 and stating that all conditions precedent
herein provided for relating to the satisfaction and discharge of this
Indenture have been complied with. If such Opinion of Counsel relates to a
deposit made in connection with clause (i)(A)(2) above, such opinion shall
further be to the effect that such deposit will not have any material
adverse tax consequences to the Issuer, the Noteholders or the
Certificateholders.
Section 4.12. APPLICATION OF TRUST MONEY. All monies deposited with the
Indenture Trustee pursuant to Section 4.10 shall be held in trust and applied by
the Indenture Trustee in accordance with the provisions of the Notes and this
Indenture to the payment, either directly or through the Paying Agent or the
Certificate Paying Agent, as the Indenture Trustee may determine, to the
Securityholders of all sums due and to become due thereon for principal and
interest; provided, that such monies need not be segregated from other funds
except to the extent required herein or required by law.
Section 4.13. RESERVED.
Section 4.14. REPAYMENT OF MONIES HELD BY PAYING AGENT. In connection with
the satisfaction and discharge of this Indenture with respect to the Notes, all
monies then held by any Person other than the Indenture Trustee under the
provisions of this Indenture with respect to the Notes shall, upon demand of the
Issuer, be paid to the Indenture Trustee to be held and applied according to
Section 3.05, and thereupon the Paying Agent shall be released from all further
liability with respect to such monies.
Section 4.15. TEMPORARY TERM NOTES. Pending the preparation of Definitive
Notes, the Issuer may execute, and upon its written direction, the Indenture
Trustee may authenticate and make available for delivery, temporary Term Notes
that are printed, lithographed, typewritten, photocopied or otherwise produced,
in any denomination, substantially of the tenor of the Definitive Notes in lieu
of which they are issued and with such appropriate insertions, omissions,
substitutions and other variations as the officers executing such Term Notes may
determine, as evidenced by their execution of such Term Notes.
If temporary Term Notes are issued, the Issuer shall cause Definitive Notes
to be prepared without unreasonable delay. After the preparation of the
Definitive Notes, the temporary Term Notes shall be exchangeable for Definitive
Notes upon surrender of such temporary Term Notes at the office or agency of the
Indenture Trustee, without charge to the related Term Noteholder. Upon surrender
for cancellation of any one or more temporary Term Notes, the Issuer shall
execute and the Indenture Trustee shall authenticate and make available for
delivery, in exchange therefor, Definitive Notes of authorized denominations and
of like tenor and aggregate principal amount. Until so exchanged, such temporary
Term Notes shall in all respects be entitled to the same benefits under this
Indenture as Definitive Notes.
ARTICLE V
DEFAULT AND REMEDIES
Section 5.01. NOTIFICATION OF CERTAIN EVENTS OF DEFAULT. The Issuer shall
deliver to the Indenture Trustee, within five days after learning of the
occurrence any event that with the giving of notice and the lapse of time would
become an Event of Default under paragraph (c) of the definition of "Event of
Default", written notice in the form of an Officer's Certificate of the status
thereof and what action the Issuer is taking or proposes to take with respect
thereto.
Section 5.02. ACCELERATION OF MATURITY; RESCISSION AND ANNULMENT. If an
Event of Default shall occur and be continuing or if the Transferor shall
purchase all of the Mortgage Loans pursuant to Section 8.08 of the Sale and
Servicing Agreement, then in every such case the Indenture Trustee, or the
Holders of Notes representing not less than a majority of the Note Balance of
the Class A Notes or the Subordinate Notes, may declare such Notes to be
immediately due and payable, by a notice in writing to the Issuer (and to the
Indenture Trustee if given by the Noteholders); and upon any such declaration,
the unpaid Note Balance of the Notes, together with accrued and unpaid interest
thereon through the date of acceleration, shall become immediately due and
payable.
At any time after a declaration of acceleration of maturity with respect to
an Event of Default has been made and before a judgment or decree for payment of
the money due has been obtained by the Indenture Trustee as hereinafter provided
in this Article, or the Holders of Notes representing not less than a majority
of the aggregate Note Balance of the Class A Notes or the Subordinate Notes that
caused the acceleration of the Notes, by written notice to the Issuer and the
Indenture Trustee, may in writing waive such Event of Default and rescind and
annul such declaration and its consequences if the Issuer has paid or deposited
with the Indenture Trustee a sum sufficient to pay:
(a) all payments of principal of and interest on the Notes and all other
amounts that would then be due hereunder or upon the Notes if the Event of
Default giving rise to such acceleration had not occurred;
(b) all sums paid or advanced by the Indenture Trustee hereunder and the
reasonable compensation, expenses, disbursements and advances of the Indenture
Trustee and its agents and counsel; and
(c) all Events of Default, other than the nonpayment of principal of the
Notes that has become due solely by such acceleration, have been cured or waived
as provided in Section 5.12.
No such rescission shall affect any subsequent default or impair any right
consequent thereto.
Section 5.03. COLLECTION OF INDEBTEDNESS AND SUITS FOR ENFORCEMENT BY
INDENTURE TRUSTEE.
(a) The Issuer covenants that if a default occurs in the payment of (i)
interest on any Note when the same becomes due and payable, and such default
continues for a period of five days, or (ii) principal of any Note when the same
becomes due and payable; then, in each case the Issuer shall, upon demand of the
Indenture Trustee, pay to the Indenture Trustee, for the benefit of the
Noteholders, the entire amount then due and payable on the Notes for principal
and interest, with interest on the overdue principal at the applicable Note
Rate. In addition thereto, the foregoing shall include such further amount as
shall be sufficient to cover the costs and expenses of collection, including the
reasonable compensation, expenses, disbursements and advances of the Indenture
Trustee and its agents and counsel.
(b) In case the Issuer shall fail forthwith to pay such amounts upon such
demand, the Indenture Trustee, in its own name and as trustee of an express
trust, subject to the provisions of Section 10.16, may, and at the direction of
the Holders of Notes representing not less than a majority of the aggregate Note
Balance of the Class A Notes or Subordinate Notes, shall, institute Proceedings
for the collection of the sums so due and unpaid, and may prosecute such
Proceedings to judgment or final decree, and may enforce the same against the
Issuer or other obligor on the Notes and collect in the manner provided by law
out of the property of the Issuer or such other obligor on the Notes, wherever
situated, the monies adjudged or decreed to be payable.
(c) If an Event of Default shall occur and be continuing, the Indenture
Trustee, subject to the provisions of Section 10.16, may, as more particularly
provided in Section 5.04, in its discretion proceed to protect and enforce its
rights and the rights of the Noteholders by such appropriate Proceedings as the
Indenture Trustee shall deem most effective to protect and enforce any such
rights, whether for the specific enforcement of any covenant or agreement in
this Indenture or in aid of the exercise of any power granted herein, or to
enforce any other proper remedy or legal or equitable right vested in the
Indenture Trustee by this Indenture or by law.
(d) In case there shall be pending, relating to the Issuer, any other
obligor on the Notes or any Person having or claiming an ownership interest in
the Trust Estate, Proceedings under Title 11 of the United States Code or any
other applicable federal or state bankruptcy, insolvency or similar law; or in
case a receiver, assignee or trustee in bankruptcy or reorganization,
liquidator, sequestrator or similar official shall have been appointed for or
taken possession of the Issuer or its property or such other obligor or Person,
or in case of any other comparable Proceedings relating to the Issuer or such
other obligor, or to the creditors or property of the Issuer or such other
obligor, the Indenture Trustee, irrespective of whether the principal of any
Notes shall then be due and payable as expressed in such Notes or by declaration
or otherwise, and irrespective of whether the Indenture Trustee shall have made
any demand pursuant to this Section, shall be entitled and empowered, by
intervention in such Proceedings or otherwise:
(i) to file and prove a claim for the entire amount of principal and
interest owing and unpaid in respect of the Notes and to file such other
papers or documents as may be necessary or advisable in order to have the
claims of the Indenture Trustee (including any claim for reasonable
compensation to the Indenture Trustee, each predecessor Indenture Trustee
and their respective agents, attorneys and counsel, and for reimbursement
of all expenses and liabilities incurred, and all advances made, by the
Indenture Trustee and each such predecessor Indenture Trustee, except as a
result of negligence, willful misconduct or bad faith) and the Noteholders
allowed in the related Proceeding;
(ii) unless prohibited by applicable law or regulation, to vote on
behalf of the Noteholders in any election of a trustee, standby trustee or
Person performing similar functions in any such Proceedings;
(iii) to collect and receive any monies or other property payable or
deliverable in respect of the claims of the Noteholders and the Indenture
Trustee and to distribute all amounts received with respect to any such
claims on their behalf; and
(iv) to file such proofs of claim and other papers or documents as may
be necessary or advisable in order to have the claims of the Indenture
Trustee or the Noteholders allowed in any judicial Proceeding relating to
the Issuer, its creditors or its property;
and any trustee, receiver, liquidator, custodian or other similar official
in any such Proceeding is hereby authorized by the Noteholders to make payments
to the Indenture Trustee and, in the event the Indenture Trustee shall consent
to the making of payments directly to the Noteholders, to pay to the Indenture
Trustee such amounts as shall be sufficient to cover reasonable compensation of
the Indenture Trustee, each predecessor Indenture Trustee and their respective
agents, attorneys and counsel, and all other expenses and liabilities incurred,
and all advances made, by the Indenture Trustee and each such predecessor
Indenture Trustee, except as a result of negligence, willful misconduct or bad
faith.
(e) Nothing contained herein shall be deemed to permit the Indenture
Trustee to authorize or consent to or vote for or accept or adopt on behalf of
any Noteholder any plan of reorganization, arrangement, adjustment or
composition affecting the Notes or the rights of any Noteholder, or to authorize
the Indenture Trustee to vote in respect of any claim of a Noteholder in any
such Proceeding, except to vote for the election of a trustee in bankruptcy or
similar Person as provided above.
(f) All rights of action and of asserting claims under this Indenture or in
respect of the Notes may be enforced by the Indenture Trustee without the
possession of any Notes or the production thereof in any Proceeding relating
thereto. Any such Proceeding instituted by the Indenture Trustee shall be
brought in its own name as trustee of an express trust, and any recovery of
judgment, subject to the payment of the expenses, disbursements and compensation
of the Indenture Trustee, each predecessor Indenture Trustee and their
respective agents and attorneys, shall be for the benefit of the Noteholders.
(g) In any Proceeding brought by the Indenture Trustee (including any
Proceeding involving the interpretation of any provision of this Indenture to
which the Indenture Trustee shall be a party), the Indenture Trustee shall be
held to represent all Noteholders, and it shall not be necessary to make any
Noteholder a party to any such Proceeding.
Section 5.04. REMEDIES; PRIORITIES.
(a) If an Event of Default shall have occurred and be continuing, the
Indenture Trustee, subject to the provisions of Section 10.16 and Section 5.05,
may or shall, at the direction of Notes representing not less than a majority of
the aggregate Note Balance of the Class A Notes or Subordinate Notes, do one or
more of the following:
(i) institute Proceedings in its own name and as trustee of an express
trust for the collection of all amounts then payable on the Notes or under
this Indenture with respect thereto, whether by declaration or otherwise,
enforce any judgment thereby obtained and collect from the Issuer or any
other obligor on the Notes any monies thereby adjudged due;
(ii) institute Proceedings from time to time for the complete or
partial foreclosure of this Indenture with respect to the Trust Estate;
(iii) exercise any remedies of a secured party under the UCC and take
any other appropriate action to protect and enforce the rights and remedies
of the Indenture Trustee and the Noteholders; and
(iv) sell the Trust Estate or any portion thereof or any right or
interest therein at one or more public or private sales called and
conducted in any manner permitted by law;
provided, however, that the Indenture Trustee may not sell or otherwise
liquidate the Trust Estate following an Event of Default, unless (A) the
Indenture Trustee obtains the consent of the Holders of Notes representing
100% of the aggregate Note Balance of the Notes, (B) the proceeds of such
sale or liquidation distributable to the Noteholders are sufficient to
discharge in full all amounts then due and unpaid on the Notes for
principal and interest, or (C) the Indenture Trustee determines that the
Mortgage Loans will not continue to provide sufficient funds for the
payment of principal of and interest on the Notes as the same would have
become due if the Notes had not been declared due and payable, and the
Indenture Trustee obtains the consent of the Holders of Notes representing
not less than 66 2/3% of the aggregate Note Balance of the Notes. In
determining such sufficiency or insufficiency with respect to clauses (B)
and (C) above, the Indenture Trustee may, but need not, obtain and rely
upon an opinion of an Independent investment banking or accounting firm of
national reputation as to the feasibility of such proposed action and as to
the sufficiency of the Trust Estate for such purpose. Notwithstanding the
foregoing, for so long as a Servicing Default shall not have occurred, any
Sale of the Trust Estate shall be made subject to the continued servicing
of the Mortgage Loans by the Master Servicer as provided in the Sale and
Servicing Agreement.
(b) If the Indenture Trustee collects any money or property pursuant to
this Article (or in any case following an Event of Default and an acceleration
of the Notes), it shall pay out such money or property in the following order:
(i) to the Indenture Trustee, for amounts due under Section 6.07 and
to the Administrator for amounts due under Section 4 of the Administration
Agreement;
(ii) to the Interest Rate Cap Counterparty, for amounts due under the
Interest Rate Cap Agreements;
(iii) to the Class A and Class A-IO Noteholders, for amounts due and
unpaid on the related Notes in respect of interest, ratably, without
preference or priority of any kind, according to the amounts then due and
payable;
(iv) to the Class A Noteholders, for amounts due and unpaid on the
related Class A Notes in respect of principal, ratably, without preference
or priority of any kind, according to the amounts then due and payable,
until the respective Note Balances of the Class A Notes have been reduced
to zero;
(v) to the Class M-1 Noteholders, for amounts due and unpaid on the
Class M-1 Notes in respect of interest, ratably, without preference or
priority of any kind, according to the amounts then due and payable;
(vi) to the Class M-1 Noteholders, for amounts due and unpaid on the
Class M-1 Notes in respect of principal, ratably, without preference or
priority of any kind, according to the amounts then due and payable, until
the respective Note Balances of the Class M-1 Notes have been reduced to
zero;
(vii) to the Class M-2 Noteholders, for amounts due and unpaid on the
Class M-2 Notes in respect of interest, ratably, without preference or
priority of any kind, according to the amounts then due and payable;
(viii) to the Class M-2 Noteholders, for amounts due and unpaid on the
Class M-2 Notes in respect of principal, ratably, without preference or
priority of any kind, according to the amounts then due and payable, until
the respective Note Balances of the Class M-2 Notes have been reduced to
zero;
(ix) to the Class B-1 Noteholders, for amounts due and unpaid on the
Class B-1 Notes in respect of interest, ratably, without preference or
priority of any kind, according to the amounts then due and payable;
(x) to the Class B-1 Noteholders, for amounts due and unpaid on the
Class B-1 Notes in respect of interest, ratably, without preference or
priority of any kind, according to the amounts then due and payable, until
the respective Note Balances of the Class B-1 Notes have been reduced to
zero; and
(xi) to the Certificate Paying Agent any remaining amounts for
distribution to the Holders of Certificates.
The Indenture Trustee may fix a record date and payment date for any
payment to Noteholders pursuant to this Section. At least 15 days before such
record date, the Indenture Trustee shall mail to each Noteholder a notice that
states such record date, and payment date and the amount to be paid.
Section 5.05. OPTIONAL PRESERVATION OF THE TRUST ESTATE. If the Notes have
been declared due and payable under Section 5.02 following an Event of Default,
and such declaration and its consequences have not been rescinded and annulled,
the Indenture Trustee may, but need not, elect to take and maintain possession
of the Trust Estate. In determining whether to take and maintain possession of
the Trust Estate, the Indenture Trustee may, but need not, obtain and rely upon
an opinion of an Independent investment banking or accounting firm of national
reputation as to the feasibility of such proposed action and as to the
sufficiency of the Trust Estate for such purpose.
Section 5.06. LIMITATION OF SUITS. No Noteholder shall have any right to
institute any Proceeding with respect to this Indenture, for the appointment of
a receiver or trustee or for any other remedy hereunder, unless (subject to the
provisions of Section 10.16):
(a) such Noteholder shall have previously given written notice to the
Indenture Trustee of a continuing Event of Default;
(b) the Holders of Notes representing not less than 25% of the aggregate
Note Balance of the Class A Notes or Subordinate Notes shall have made written
request to the Indenture Trustee to institute such Proceeding in respect of such
Event of Default in its own name as Indenture Trustee hereunder;
(c) such Noteholders shall have offered the Indenture Trustee reasonable
indemnity against the costs, expenses and liabilities that may be incurred by it
in complying with such request;
(d) the Indenture Trustee for 60 days after its receipt of such notice,
request and offer of indemnity shall have failed to institute such Proceedings;
and
(e) no direction inconsistent with such written request shall have been
given to the Indenture Trustee during such 60-day period by the Holders of Notes
representing not less than a majority of the aggregate Note Balance of the
Notes.
No Noteholder shall have any right in any manner whatsoever by virtue of or
by availing itself of any provision of this Indenture to affect, disturb or
prejudice the rights of any other Noteholder, to obtain or to seek to obtain
priority or preference over any other Noteholder or to enforce any right under
this Indenture, in each case except in the manner herein provided.
In the event that the Indenture Trustee shall receive conflicting or
inconsistent requests and indemnity from two or more groups of Noteholders, each
representing less than a majority of the aggregate Note Balance of the Notes,
the Indenture Trustee in its sole discretion may determine what action, if any,
shall be taken, notwithstanding any other provision of this Indenture.
Section 5.07. UNCONDITIONAL RIGHT OF NOTEHOLDERS TO RECEIVE PRINCIPAL AND
INTEREST. Notwithstanding any other provision of this Indenture, each Noteholder
shall have the right, which is absolute and unconditional, to receive payment of
the interest and principal, if any, due on such Noteholder's Notes on or after
the due date expressed in such Notes or in this Indenture and to institute suit
for the enforcement of any such payment. Such right shall not be impaired
without the consent of the related Noteholder.
Section 5.08. RESTORATION OF RIGHTS AND REMEDIES. If the Indenture Trustee
or any Noteholder has instituted any Proceeding to enforce any right or remedy
under this Indenture and such Proceeding has been discontinued or abandoned for
any reason, or has been determined adversely to the Indenture Trustee or to such
Noteholder, then in every such case the Issuer, the Indenture Trustee and the
Noteholders shall, subject to any determination in such Proceeding, be restored
severally and respectively to their former positions hereunder, and thereafter
all rights and remedies of the Indenture Trustee and the Noteholders shall
continue as though no such Proceeding had been instituted.
Section 5.09. RIGHTS AND REMEDIES CUMULATIVE. No right or remedy herein
conferred upon or reserved to the Indenture Trustee or the Noteholders is
intended to be exclusive of any other right or remedy, and every right and
remedy shall, to the extent permitted by law, be cumulative and in addition to
every other right and remedy given hereunder or now or hereafter existing at law
or in equity or otherwise. The assertion or employment of any right or remedy
hereunder or otherwise shall not prevent the concurrent assertion or employment
of any other appropriate right or remedy.
Section 5.10. DELAY OR OMISSION NOT A WAIVER. No delay or omission of the
Indenture Trustee or any Noteholder to exercise any right or remedy accruing
upon an Event of Default shall impair any such right or remedy or constitute a
waiver of any such Event of Default or an acquiescence therein. Every right and
remedy given by this Article or by law to the Indenture Trustee or the
Noteholders may be exercised from time to time, and as often as may be deemed
expedient, by the Indenture Trustee or the Noteholders, as the case may be.
Section 5.11. CONTROL BY NOTEHOLDERS. The Holders of Notes representing not
less than a majority of the aggregate Note Balance of the Notes (unless this
Indenture provides that the Class A Notes or the Subordinate Notes, as
applicable, may direct such action) shall have the right to direct the time,
method and place of conducting any Proceeding for any remedy available to the
Indenture Trustee with respect to the Notes or exercising any trust or power
conferred on the Indenture Trustee; provided that:
(a) such direction shall not conflict with any rule of law or with this
Indenture;
(b) subject to Section 5.04, any direction to the Indenture Trustee to sell
or liquidate the Trust Estate shall be given by Holders of Notes representing
100% of the aggregate Note Balance of the Notes;
(c) if the conditions set forth in Section 5.05 have been satisfied and the
Indenture Trustee elects to retain the Trust Estate pursuant to such Section,
then any direction to the Indenture Trustee by Holders of Notes representing
less than 100% of the aggregate Note Balance of the Notes to sell or liquidate
the Trust Estate shall be of no force or effect; and
(d) the Indenture Trustee may take any other action deemed proper by the
Indenture Trustee that is not inconsistent with such direction.
Notwithstanding the rights of the Noteholders as set forth in this Section,
and subject to Section 6.01, the Indenture Trustee need not take any action
that it determines might subject it to liability or might materially and
adversely affect the rights of any Noteholders not consenting thereto.
Section 5.12. WAIVER OF PAST DEFAULTS. Prior to the declaration of the
acceleration of the maturity of the Notes as provided in Section 5.02, the
Holders of Notes representing not less than a majority of the aggregate Note
Balance of the Notes that caused the acceleration of the Notes may waive any
past Event of Default and its consequences, except an Event of Default (a) with
respect to payment of principal of or interest on the Notes or (b) in respect of
a covenant or provision hereof that cannot be modified or amended without the
consent of all Noteholders or each Noteholder affected thereby. In the case of
any such waiver, the Issuer, the Indenture Trustee and the Noteholders shall be
restored to their respective former positions and rights hereunder; provided,
that no such waiver shall extend to any subsequent or other Event of Default or
impair any right consequent thereto.
Upon any such waiver, any Event of Default arising therefrom shall be
deemed to have been cured and not to have occurred for every purpose of this
Indenture; provided, that no such waiver shall extend to any subsequent or other
Event of Default or impair any right consequent thereto.
Section 5.13. UNDERTAKING FOR COSTS. The parties hereto agree, and each
Noteholder, by such Noteholder's acceptance of a Note, shall be deemed to have
agreed, that any court may in its discretion require, in any Proceeding for the
enforcement of any right or remedy under this Indenture, or in any Proceeding
against the Indenture Trustee for any action taken, suffered or omitted by it as
Indenture Trustee, the filing by any party litigant in such Proceeding of an
undertaking to pay the costs of such Proceeding, and that such court may in its
discretion assess reasonable costs, including reasonable attorneys' fees,
against any party litigant in such Proceeding, having due regard to the merits
and good faith of the claims or defenses made by such party litigant; provided,
that the provisions of this Section shall not apply to any Proceeding instituted
by (i) the Indenture Trustee, (ii) any Noteholder or group of Noteholders, in
each case holding Notes representing in the aggregate more than 10% of the
aggregate Note Balance (or in the case of a right or remedy under this Indenture
which is instituted by the Class A Notes or Subordinate Notes, more than 10% of
the Note Balance of the Class A Notes or Subordinate Notes, as the case may be)
or (iii) any Noteholder for the enforcement of the payment of principal of or
interest on any Note on or after the due date expressed in such Note and in this
Indenture.
Section 5.14. WAIVER OF STAY OR EXTENSION LAWS. The Issuer covenants (to
the extent that it may lawfully do so) that it will not at any time insist upon,
plead or in any manner whatsoever claim or take the benefit or advantage of any
stay or extension law wherever enacted, now or at any time hereafter in force,
that may affect the covenants or the performance of this Indenture; and the
Issuer (to the extent that it may lawfully do so) hereby expressly waives all
benefit or advantage of any such law and covenants that it will not hinder,
delay or impede the execution of any power herein granted to the Indenture
Trustee, but will suffer and permit the execution of each such power as though
no such law had been enacted.
Section 5.15. SALE OF TRUST ESTATE.
(a) The power to effect any sale or other disposition (each, a "Sale") of
any portion of the Trust Estate pursuant to Section 5.04 is expressly subject to
the provisions of Section 5.05 and this Section. The power to effect any such
Sale shall not be exhausted by any one or more Sales as to any portion of the
Trust Estate remaining unsold. The power to effect any such Sale shall continue
unimpaired until the entire Trust Estate has been sold or all amounts payable on
the Notes, under this Indenture have been paid. The Indenture Trustee may from
time to time postpone any public Sale by public announcement made at the time
and place of such Sale. The Indenture Trustee hereby expressly waives its right
to any amount fixed by law as compensation for any Sale.
(b) The Indenture Trustee shall not in any private Sale sell the Trust
Estate, or any portion thereof, unless:
(i) all Noteholders consent to or direct the Indenture Trustee to make
such Sale;
(ii) the proceeds of such Sale would be not less than the entire
amount that would be payable to the Securityholders, in full payment
thereof in accordance with Section 5.02, on the Payment Date next
succeeding the date of such Sale; or
(iii) the Indenture Trustee determines, in its sole discretion, that
the conditions for retention of the Trust Estate set forth in Section 5.05
cannot be satisfied (and in making any such determination, the Indenture
Trustee may rely upon an opinion of an Independent investment banking firm
obtained and delivered as provided in Section 5.05), and Holders of Notes
representing not less than 66 2/3% of the aggregate Note Balance of the
Notes consent to such Sale.
The purchase by the Indenture Trustee of all or any portion of the Trust
Estate at a private Sale shall not be deemed a Sale or other disposition
thereof for purposes of this paragraph.
(c) Unless the Noteholders have otherwise consented or directed the
Indenture Trustee, at any public Sale of all or any portion of the Trust Estate
at which a minimum bid equal to or greater than the amount described in clause
(ii) of paragraph (b) of this Section has not been established by the Indenture
Trustee, and no Person bids an amount equal to or greater than such amount, the
Indenture Trustee shall bid an amount at least $1.00 greater than the highest
other bid.
(d) In connection with a Sale of all or any portion of the Trust Estate:
(i) any Noteholder may bid for and purchase the property offered for
sale and, upon compliance with the terms of sale, may hold, retain, possess
and dispose of such property without further accountability; and may, in
paying the purchase price therefor, deliver any Notes or claims for
interest thereon in lieu of cash up to the amount, upon distribution of the
net proceeds of such Sale, payable thereon. Such Notes, in case the amounts
so payable thereon shall be less than the amount due thereon, shall be
returned to the Holders thereof after being appropriately stamped to show
such partial payment;
(ii) the Indenture Trustee may bid for and acquire the property
offered for Sale, may, subject to any requirements of and to the extent
permitted by applicable law in connection therewith, purchase all or any
portion of the Trust Estate in a private Sale, and may, in lieu of paying
cash therefor, make settlement for the purchase price by crediting the
gross sale price against the sum of (A) the amount that would be
distributable to the Securityholders as a result of such Sale in accordance
with Section 5.04(b) on the Payment Date next succeeding the date of such
Sale and (B) the expenses of such Sale and of any Proceeding in connection
therewith that are reimbursable to it, without being required to produce
the Notes in order to complete any such Sale or in order for the net sale
price to be credited against such Notes; and any property so acquired by
the Indenture Trustee shall be held and dealt with by it in accordance with
the provisions of this Indenture;
(iii) the Indenture Trustee shall execute and deliver an appropriate
instrument of conveyance transferring its interest in any portion of the
Trust Estate in connection with a Sale thereof;
(iv) the Indenture Trustee is hereby irrevocably appointed the agent
and attorney in-fact of the Issuer to transfer and convey its interest in
any portion of the Trust Estate in connection with a Sale thereof, and to
take all action necessary to effect such Sale; and
(v) no purchaser or transferee at any such Sale shall be bound to
ascertain the Indenture Trustee's authority, inquire into the satisfaction
of any conditions precedent or see to the application of any monies.
Section 5.16. ACTION ON NOTES. The Indenture Trustee's right to seek and
recover judgment on the Notes or under this Indenture shall not be affected by
the seeking, obtaining or application of any other relief under or with respect
to this Indenture. Neither the Lien of this Indenture nor any rights or remedies
of the Indenture Trustee or the Noteholders shall be impaired by the recovery of
any judgment by the Indenture Trustee against the Issuer or by the levy of any
execution under such judgment upon any portion of the Trust Estate or any other
assets of the Issuer. Any money or property collected by the Indenture Trustee
shall be applied in accordance with Section 5.04(b).
Section 5.17. PERFORMANCE AND ENFORCEMENT OF CERTAIN OBLIGATIONS.
(a) Promptly following a written request from the Indenture Trustee to do
so, the Issuer, in its capacity as owner of the Mortgage Loans, shall take all
such lawful action as the Indenture Trustee may request to cause the Issuer to
compel or secure the performance and observance by the Transferor and the Master
Servicer, as applicable, of each of their obligations to the Issuer under or in
connection with the Mortgage Loan Sale Agreement and the Sale and Servicing
Agreement, and to exercise any and all rights, remedies, powers and privileges
lawfully available to the Issuer under or in connection with the Mortgage Loan
Sale Agreement and the Sale and Servicing Agreement, to the extent and in the
manner directed by the Indenture Trustee, as pledgee of the Mortgage Loans,
including the transmission of notices of default on the part of the Transferor
or the Master Servicer thereunder and the institution of Proceedings to compel
or secure performance by the Transferor or the Master Servicer of each of their
obligations under the Mortgage Loan Sale Agreement and the Sale and Servicing
Agreement.
(b) If an Event of Default shall have occurred and be continuing, the
Indenture Trustee, as pledgee of the Mortgage Loans, may, and at the direction
(which direction shall be in writing or by telephone confirmed in writing
promptly thereafter) of the Holders of Notes representing not less than 66 2/3%
of the aggregate Note Balance of the Class A Notes or Subordinate Notes, shall,
exercise all rights, remedies, powers, privileges and claims of the Issuer
against the Transferor or the Master Servicer under or in connection with the
Mortgage Loan Sale Agreement or the Sale and Servicing Agreement, including the
right or power to take any action to compel or secure performance or observance
by the Transferor or the Master Servicer, as the case may be, of each of their
respective obligations to the Issuer thereunder and to give any consent,
request, notice, direction, approval, extension or waiver under the Mortgage
Loan Sale Agreement or the Sale and Servicing Agreement, as the case may be, and
any right of the Issuer to take such action shall not be suspended. In
connection therewith, as determined by the Indenture Trustee, the Issuer shall
execute all documents provided to it by the Indenture Trustee necessary to
effect the transfer of the Mortgage Loans to the Indenture Trustee.
ARTICLE VI
THE INDENTURE TRUSTEE
Section 6.01. DUTIES OF INDENTURE TRUSTEE.
(a) If an Event of Default shall have occurred and be continuing, the
Indenture Trustee shall exercise the rights and powers vested in it by this
Indenture and use the same degree of care and skill in their exercise as a
prudent Person would exercise under the circumstances in the conduct of such
Person's own affairs.
(b) Except during the continuance of an Event of Default:
(i) the Indenture Trustee undertakes to perform such duties and only
such duties as are specifically set forth in this Indenture, and no implied
covenants or obligations shall be read into this Indenture against the
Indenture Trustee; and
(ii) in the absence of bad faith on its part, the Indenture Trustee
may conclusively rely, as to the truth of the statements and the
correctness of the opinions expressed therein, upon certificates or
opinions furnished to the Indenture Trustee that conform to the
requirements of this Indenture; provided, that the Indenture Trustee shall
examine such certificates and opinions to determine whether or not they
conform to the requirements of this Indenture.
(c) The Indenture Trustee may not be relieved from liability for its own
negligent action, its own negligent failure to act or its own willful
misconduct, except that:
(i) this paragraph does not limit the effect of paragraph (b) of this
Section;
(ii) the Indenture Trustee shall not be liable for any error of
judgment made in good faith by a Responsible Officer unless it is proved
that the Indenture Trustee was negligent in ascertaining the pertinent
facts; and
(iii) the Indenture Trustee shall not be liable with respect to any
action it takes or omits to take in good faith in accordance with a
direction received by it pursuant to Section 5.11.
(d) The Indenture Trustee shall not be liable for interest on any money
received by it except as the Indenture Trustee may agree in writing with the
Issuer.
(e) Money held in trust by the Indenture Trustee need not be segregated
from other funds except to the extent required by law or the terms of this
Indenture or the Trust Agreement.
(f) No provision of this Indenture shall require the Indenture Trustee to
expend or risk its own funds or otherwise incur financial liability in the
performance of any of its duties hereunder or in the exercise of any of its
rights or powers, if it shall have reasonable grounds to believe that repayment
of such funds or adequate indemnity against such risk or liability is not
reasonably assured to it.
(g) Every provision of this Indenture relating to the conduct or affecting
the liability of or affording protection to the Indenture Trustee shall be
subject to the provisions of this Section and to the provisions of the TIA.
(h) For all purposes under this Indenture, the Indenture Trustee shall not
be deemed to have notice or knowledge of any Amortization Event or Event of
Default unless a Responsible Officer has actual knowledge thereof or unless
written notice of any event which is in fact an Amortization Event or an Event
of Default is received by the Indenture Trustee at the Corporate Trust Office,
and such notice references the Notes generally, the Issuer, or this Indenture.
Section 6.02. RIGHTS OF INDENTURE TRUSTEE.
(a) The Indenture Trustee may rely upon any document believed by it to be
genuine and to have been signed or presented by the proper Person. The Indenture
Trustee need not investigate any fact or matter stated in such document.
(b) Before the Indenture Trustee acts or refrains from acting, it may
require an Officer's Certificate or an Opinion of Counsel. The Indenture Trustee
shall not be liable for any action it takes or omits to take in good faith in
reliance on any such Officer's Certificate or Opinion of Counsel.
(c) The Indenture Trustee may execute any of the trusts or powers or
perform any duties hereunder either directly or by or through agents, attorneys,
a custodian or a nominee, and the Indenture Trustee shall not be responsible for
any misconduct or negligence on the part of, or for the supervision of, any such
agent, attorney, custodian or nominee appointed with due care by it hereunder.
(d) The Indenture Trustee shall not be liable for any action it takes or
omits to take in good faith that it believes to be authorized or within its
rights or powers, provided that the Indenture Trustee's conduct does not
constitute willful misconduct, negligence or bad faith.
(e) The Indenture Trustee may consult with counsel, and the advice or
opinion of counsel with respect to legal matters relating to this Indenture and
the Notes shall be full and complete authorization and protection from liability
in respect to any action taken, omitted or suffered by it hereunder in good
faith and in accordance with the advice or opinion of such counsel.
Section 6.03. INDIVIDUAL RIGHTS OF INDENTURE TRUSTEE. The Indenture Trustee
in its individual or any other capacity may become the owner or pledgee of
Securities and may otherwise deal with the Issuer and its Affiliates with the
same rights that it would have if it were not Indenture Trustee. Any Note
Registrar, co-registrar or co-paying agent may do the same with like rights.
Notwithstanding the foregoing, the Indenture Trustee must comply with Sections
6.11 and 6.12.
Section 6.04. INDENTURE TRUSTEE'S DISCLAIMER. The Indenture Trustee shall
not be (a) responsible for and makes no representation as to the validity or
adequacy of this Indenture or the Notes, (b) accountable for the Issuer's use of
the proceeds from the sale of the Notes or (c) responsible for any statement of
the Issuer in the Indenture, in any document issued in connection with the sale
of the Notes or in the Notes, other than the Indenture Trustee's certificate of
authentication.
Section 6.05. NOTICE OF EVENT OF DEFAULT. The Indenture Trustee shall mail
to each Noteholder notice of any Event of Default within 90 days promptly after
such Event of Default occurs. Except in the case of an Event of Default relating
to the payment of principal of or interest on any Note, the Indenture Trustee
may withhold such notice to the Noteholders only if and for so long as a
committee of its Responsible Officers in good faith determines that withholding
such notice is in the interests of the Noteholders.
Section 6.06. REPORTS BY INDENTURE TRUSTEE TO NOTEHOLDERS. The Indenture
Trustee shall deliver to each Noteholder such information in the possession of
the Indenture Trustee as may be required to enable such Noteholder to prepare
its federal and state income tax returns. In addition, upon Issuer Request, the
Indenture Trustee shall promptly furnish information in the possession of the
Indenture Trustee reasonably requested by the Issuer that is reasonably
available to the Indenture Trustee to enable the Issuer to perform its federal
and state income tax reporting obligations.
Section 6.07. COMPENSATION. On each Payment Date, the Issuer shall pay to
the Indenture Trustee compensation for its services in an amount equal to
investment earnings, net of losses on amounts on deposit in the Trustee
Collection Account for the two calendar days preceding a Payment Date in
accordance with Section 5.03 of the Sale and Servicing Agreement. To the extent
losses exceeds investments earnings, the Indenture Trustee shall deposit amounts
in the Trustee Collection Account from its own funds. The Indenture Trustee
shall be compensated and indemnified by the Master Servicer in accordance with
Section 6.06 of the Sale and Servicing Agreement, and all amounts owing to the
Indenture Trustee hereunder and not paid pursuant to Sections 3.17 and 6.06 of
the Sale and Servicing Agreement shall be paid solely as provided in Section
3.05(a)(xiii) and Section 5.04 (subject to the priorities set forth therein).
The Indenture Trustee's compensation shall not be limited by any law relating to
compensation of a trustee of an express trust. The Issuer shall reimburse the
Indenture Trustee for all reasonable out-of-pocket expenses incurred or made by
the Indenture Trustee in addition to the compensation for its services. Such
expenses shall include costs of collection and reasonable compensation and
expenses, disbursements and advances of the Indenture Trustee's agents, counsel,
accountants and experts.
The Issuer's payment obligations to the Indenture Trustee pursuant to this
Section shall survive the discharge of this Indenture. When the Indenture
Trustee incurs expenses after the occurrence of an Event of Default specified in
paragraph (d) or (e) of the definition thereof with respect to the Issuer, such
expenses are intended to constitute expenses of administration under Title 11 of
the United States Code or any other applicable federal or state bankruptcy,
insolvency or similar law.
Section 6.08. REPLACEMENT OF INDENTURE TRUSTEE. No resignation or removal
of the Indenture Trustee and no appointment of a successor Indenture Trustee
shall become effective until the acceptance of appointment by the successor
Indenture Trustee pursuant to this Section. The Indenture Trustee may resign at
any time by so notifying the Issuer. The Holders of Notes representing not less
than a majority of the aggregate Note Balance of the Class A Notes or
Subordinate Notes may remove the Indenture Trustee by so notifying the Indenture
Trustee, and may appoint a successor Indenture Trustee. The Issuer shall remove
the Indenture Trustee if:
(a) the Indenture Trustee fails to comply with Section 6.11;
(b) the Indenture Trustee is adjudged a bankrupt or insolvent;
(c) a receiver or other public officer takes charge of the Indenture
Trustee or its property; or
(d) the Indenture Trustee otherwise becomes incapable of acting.
If the Indenture Trustee resigns or is removed or if a vacancy exists in
the office of the Indenture Trustee for any reason (the Indenture Trustee in
such event being referred to herein as the retiring Indenture Trustee), the
Issuer shall promptly appoint a successor Indenture Trustee. In addition, the
Indenture Trustee shall resign to avoid being directly or indirectly controlled
by the Issuer.
A successor Indenture Trustee shall deliver a written acceptance of its
appointment to the retiring Indenture Trustee and the Issuer. Thereupon, the
resignation or removal of the retiring Indenture Trustee shall become effective,
and the successor Indenture Trustee shall have all the rights, powers and duties
of the Indenture Trustee under this Indenture. The successor Indenture Trustee
shall mail a notice of its succession to the Noteholders. The retiring Indenture
Trustee shall promptly transfer all property held by it as Indenture Trustee to
the successor Indenture Trustee.
If a successor Indenture Trustee does not take office within 60 days after
the retiring Indenture Trustee resigns or is removed, the retiring Indenture
Trustee, the Issuer or the Holders of Notes representing not less than a
majority of the aggregate Note Balance may petition any court of competent
jurisdiction for the appointment of a successor Indenture Trustee.
If the Indenture Trustee fails to comply with Section 6.11, any Noteholder
may petition a court of competent jurisdiction for the removal of the Indenture
Trustee and the appointment of a successor Indenture Trustee.
Section 6.09. SUCCESSOR INDENTURE TRUSTEE BY MERGER. If the Indenture
Trustee consolidates with, merges or converts into or transfers all or
substantially all its corporate trust business or assets to another corporation
or banking association, the resulting, surviving or transferee without any
further act shall be the successor Indenture Trustee hereunder; provided, that
such corporation or banking association shall be otherwise qualified and
eligible under Section 6.11. The Indenture Trustee shall provide each Rating
Agency with written notice of any such transaction after the Closing Date.
In case at the time such successor or successors by merger, conversion or
consolidation to the Indenture Trustee shall succeed to the trusts created by
this Indenture, any of the Notes shall have been authenticated but not
delivered, any such successor to the Indenture Trustee may adopt the certificate
of authentication of any predecessor Indenture Trustee, and deliver such Notes
so authenticated. In case at such time any of the Notes shall not have been
authenticated, any successor Indenture Trustee may authenticate such Notes
either in the name of any predecessor hereunder or in the name of the successor
Indenture Trustee; and in all such cases, such certificates shall have the full
force that it is anywhere in the Notes or in this Indenture provided that the
certificate of the Indenture Trustee shall have.
Section 6.10. APPOINTMENT OF CO-INDENTURE TRUSTEE OR SEPARATE INDENTURE
TRUSTEE.
(a) Notwithstanding any other provision of this Indenture, at any time, for
the purpose of meeting any legal requirement of any jurisdiction in which any
part of the Trust Estate may at such time be located, the Indenture Trustee
shall have the power and may execute and deliver all instruments to appoint one
or more Persons to act as a co-trustee or co-trustees or separate trustee or
separate trustees, and to vest in such Person or Persons, in such capacity and
for the benefit of the Noteholders, such title to the Trust Estate or any part
thereof and, subject to the other provisions of this Section, such powers,
duties, obligations, rights and trusts as the Indenture Trustee may consider
necessary or desirable. No co-trustee or separate trustee hereunder shall be
required to meet the terms of eligibility as a successor trustee under Section
6.11, and no notice to Noteholders of the appointment of any co-trustee or
separate trustee shall be required under Section 6.08.
(b) Each separate trustee and co-trustee shall, to the extent permitted by
law, be appointed and act subject to the following provisions and conditions:
(i) all rights, powers, duties and obligations conferred or imposed
upon the Indenture Trustee shall be conferred or imposed upon and exercised
or performed by the Indenture Trustee and such separate trustee or
co-trustee jointly (it being understood that such separate trustee or
co-trustee is not authorized to act separately without the Indenture
Trustee joining in such act), except to the extent that under any law of
any jurisdiction in which any particular act or acts are to be performed
the Indenture Trustee shall be incompetent or unqualified to perform such
act or acts, in which event such rights, powers, duties and obligations
(including the holding of title to the Trust Estate or any portion thereof
in any such jurisdiction) shall be exercised and performed singly by such
separate trustee or co-trustee, but solely at the direction of the
Indenture Trustee;
(ii) no trustee hereunder shall be personally liable by reason of any
act or omission of any other trustee hereunder; and
(iii) the Indenture Trustee may at any time accept the resignation of
or remove any separate trustee or co-trustee.
(c) Any notice, request or other writing given to the Indenture Trustee
shall be deemed to have been given to each of the then-separate trustees and
co-trustees, as effectively as if given to each of them. Each instrument
appointing a separate trustee or co-trustee shall refer to this Indenture and to
the conditions of this Article. Each separate trustee and co-trustee, upon its
acceptance of the trusts conferred, shall be vested with the estates or property
specified in its instrument of appointment, either jointly with the Indenture
Trustee or separately, as may be provided therein, subject to all provisions of
this Indenture, including each provision relating to the conduct of, affecting
the liability of or affording protection to the Indenture Trustee. Each such
instrument shall be filed with the Indenture Trustee.
(d) Any separate trustee or co-trustee may at any time constitute the
Indenture Trustee its agent or attorney-in-fact with full power and authority,
to the extent not prohibited by law, to do any lawful act under or in respect of
this Indenture on its behalf and in its name. If any separate trustee or
co-trustee shall die, become incapable of acting, resign or be removed, all of
its estates, properties, rights, remedies and trusts shall vest in and be
exercised by the Indenture Trustee, to the extent permitted by law, without the
appointment of a new or successor trustee.
Section 6.11. ELIGIBILITY; DISQUALIFICATION. (a) The Indenture Trustee
shall at all times satisfy the requirements of TIA ss.310(a). The Indenture
Trustee shall have a combined capital and surplus of at least $50,000,000 as set
forth in its most recent published annual report of condition and it or its
parent shall have a long-term debt rating of A or better by Moody's. The
Indenture Trustee shall comply with TIA ss.310(b), including the optional
provision permitted by the second sentence of TIA ss.310(b)(9); provided, that
there shall be excluded from the operation of TIA ss.310(b)(1) any indenture or
indentures under which other securities of the Issuer are outstanding if the
requirements for such exclusion set forth in TIA ss.310(b)(1) are met.
(b) Within ninety (90) days after ascertaining the occurrence of an Event
of Default which shall not have been cured or waived, unless authorized by the
TIA or the Commission, the Indenture Trustee shall resign with respect to the
Class A Notes, the Class M-1 Notes, the M-2 Notes and/or the Class B-1 Notes in
accordance with Section 6.08 of this Indenture, and the Issuer shall appoint a
successor Indenture Trustee for two or more of such Classes, as applicable, so
that there will be separate Indenture Trustees for the Class A Notes, the Class
M-1 Notes, the Class M-2 Notes and the Class B-1 Notes. In the event the
Indenture Trustee fails to comply with the terms of the preceding sentence, the
Indenture Trustee shall comply with clauses (ii) and (iii) of TIA Section
310(b).
(c) In the case of the appointment hereunder of a successor Indenture
Trustee with respect to any Class of Notes pursuant to this Section 6.11,
Issuer, the retiring Indenture Trustee and the successor Indenture Trustee with
respect to such Class of Notes shall execute and deliver an indenture
supplemental hereto wherein each successor Indenture Trustee shall accept such
appointment and which (i) shall contain such provisions as shall be necessary or
desirable to transfer and confirm to, and to vest in, the successor Indenture
Trustee all the rights, powers, trusts and duties of the retiring Indenture
Trustee with respect to the Notes of the Class to which the appointment of such
successor Indenture Trustee relates, (ii) if the retiring Indenture Trustee is
not retiring with respect to all Classes of Notes, shall contain such provisions
as shall be deemed necessary or desirable to confirm that all the rights,
powers, trusts and duties of the retiring Indenture Trustee with respect to the
Notes of each Class as to which the retiring Indenture Trustee is not retiring
shall continue to be vested in the Indenture Trustee and (iii) shall add to or
change any of the provisions of this Indenture as shall be necessary to provide
for or facilitate the administration of the trusts hereunder by more than one
Indenture Trustee, it being understood that nothing herein or in such
supplemental indenture shall constitute such Indenture Trustees co-trustees of
the same trust and that each such Indenture Trustee shall be a trustee of a
trust or trusts hereunder separate and apart from any trust or trusts hereunder
administered by any other such Indenture Trustee; and upon the removal of the
retiring Indenture Trustee shall become effective to the extent provided herein.
Section 6.12. PREFERENTIAL COLLECTION OF CLAIMS AGAINST ISSUER. The
Indenture Trustee shall comply with TIA ss.311 (a), excluding any creditor
relationship listed in TIA ss.311 (b). Any Indenture Trustee that has resigned
or been removed shall be subject to TIA ss.311 (a) to the extent indicated
therein.
Section 6.13. REPRESENTATIONS AND WARRANTIES. The Indenture Trustee hereby
represents and warrants that:
(a) the Indenture Trustee is a national banking association duly organized,
validly existing and in good standing under the laws of the United States, with
full power and authority to own its properties and to conduct its business as
such properties are currently owned and such business is presently conducted;
(b) the Indenture Trustee has the power and authority to execute and
deliver this Indenture and to carry out its terms; and the execution, delivery
and performance of this Indenture have been duly authorized by the Indenture
Trustee by all necessary action;
(c) the consummation of the transactions contemplated by this Indenture and
the fulfillment of the terms hereof do not conflict with, result in any breach
of any of the terms and provisions of, or constitute (with or without notice or
lapse of time) a default under, the charter or bylaws of the Indenture Trustee
or any agreement or other instrument to which the Indenture Trustee is a party
or by which it may be bound;
(d) to the Indenture Trustee's knowledge, there are no Proceedings or
investigations pending or threatened before any court, regulatory body,
administrative agency or other governmental instrumentality having jurisdiction
over the Indenture Trustee or any of its properties: (i) asserting the
invalidity of this Indenture, (ii) seeking to prevent the consummation of any of
the transactions contemplated by this Indenture or (iii) seeking any
determination or ruling that might materially and adversely affect the
performance by the Indenture Trustee of its obligations under, or the validity
or enforceability of, this Indenture; and
(e) the Indenture Trustee does not have notice of any adverse claim (as
such terms are used in UCC Section 8-302) with respect to the Mortgage Loans.
Section 6.14. DIRECTIONS TO INDENTURE TRUSTEE. The Indenture Trustee is
hereby directed:
(a) to accept the pledge of the Mortgage Loans and hold the Trust Estate in
trust for the benefit of the Noteholders;
(b) to authenticate and deliver the Notes substantially in the form of
Exhibits X-0, X-0, and A-3 hereto in accordance with the terms of this
Indenture; and
(c) to take all other actions as shall be required to be taken by the terms
of this Indenture.
Section 6.15. CONFLICTING INSTRUCTIONS. If the Indenture Trustee receives
conflicting instructions from the Class A Noteholders and the Subordinate
Noteholders, the instructions of the Class A Noteholders shall control.
ARTICLE VII
NOTEHOLDERS' LISTS AND REPORTS
Section 7.01. ISSUER TO FURNISH INDENTURE TRUSTEE NAMES AND ADDRESSES OF
NOTEHOLDERS. The Issuer shall furnish or cause to be furnished to the Indenture
Trustee (i) not more than five days after each Record Date, a list, in such form
as the Indenture Trustee may reasonably require, of the names and addresses of
the Noteholders as of such Record Date, and (ii) at such other times as the
Indenture Trustee may request in writing, within 30 days after receipt by the
Issuer of any such request, a list in similar form and of similar content as of
a date not more than 10 days prior to the time such list is furnished; provided,
that for so long as the Indenture Trustee is the Note Registrar, no such list
need be furnished.
Section 7.02. PRESERVATION OF INFORMATION; COMMUNICATIONS TO NOTEHOLDERS.
(a) The Indenture Trustee shall preserve, in as current a form as is
reasonably practicable, the names and addresses of the Noteholders contained in
the most recent list furnished to the Indenture Trustee as provided in Section
7.01, and the names and addresses of the Noteholders received by the Indenture
Trustee in its capacity as Note Registrar. The Indenture Trustee may destroy any
list furnished to it as provided in such Section upon receipt of a new list so
furnished.
(b) Noteholders may communicate pursuant to TIA ss.312(b) with other
Noteholders with respect to their rights under this Indenture or the Notes.
(c) The Issuer, the Indenture Trustee and the Note Registrar shall have the
protection of TIAss.312(c).
Section 7.03. REPORTS BY ISSUER.
(a) Within 15 days after each Payment Date, the Indenture Trustee shall
file with the Commission via the Electronic Data Gathering and Retrieval System
(XXXXX), a Form 8-K with a copy of the statement to the Notheholders for such
Payment Date as an exhibit thereto. Prior to January 31, 2002 the Indenture
Trustee shall file a Form 15 Suspension Notification with respect to the Trust
Estate, if applicable. Prior to March 31, 2002, the Indenture Trustee shall file
a Form 10-K, in substance conforming to industry standards, with respect to the
Trust Estate. The Issuer hereby grants to the Indenture Trustee a limited power
of attorney to execute and file each such document on behalf of the Issuer. Such
power of attorney shall continue until either the earlier of (i) receipt by the
Indenture Trustee from the Issuer of written termination of such power of
attorney and (ii) the termination of the Issuer. The Issuer agrees to promptly
furnish to the Indenture Trustee, from time to time upon request, such further
information, reports, and financial statements within its control related to
this Indenture and the Mortgage Loans as the Indenture Trustee reasonably deems
appropriate to prepare and file all necessary reports with the Commission. The
Indenture Trustee shall have no responsibility to file any item other that those
specified in this section.
(b) The Issuer shall supply to the Indenture Trustee (and the Indenture
Trustee shall transmit by mail to all Noteholders described in TIA ss.313(c))
such summaries of any information, documents and reports required to be filed by
the Issuer pursuant to clauses (i) and (ii) of this paragraph and by rules and
regulations prescribed from time to time by the Commission.
(c) Unless the Issuer otherwise determines, the fiscal year of the Issuer
shall end on December 31 of each year.
Section 7.04. REPORTS BY INDENTURE TRUSTEE. If required by TIA ss.313(a),
within 60 days after each January 1, commencing with January 1, 2002, the
Indenture Trustee shall mail to each Noteholder as required by TIA ss.313(c) a
brief report dated as of such date that complies with TIA ss.313(a). The
Indenture Trustee also shall comply with TIA ss. 313(b).
A copy of each report at the time of its mailing to the Noteholders shall
be filed by the Indenture Trustee with the Commission and each stock exchange,
if any, on which the Term Notes are listed. The Issuer shall notify the
Indenture Trustee if and when the Term Notes are listed on any stock exchange.
ARTICLE VIII
ACCOUNTS, DISBURSEMENTS AND RELEASES
Section 8.01. COLLECTION OF MONEY. Except as otherwise expressly provided
herein, the Indenture Trustee may demand payment or delivery of, and shall
receive and collect, directly and without intervention or assistance of any
fiscal agent or other intermediary, all money and other property payable to or
receivable by the Indenture Trustee pursuant to this Indenture. The Indenture
Trustee shall apply all such money received by it as provided in this Indenture.
Except as otherwise expressly provided in this Indenture, if any default occurs
in the making of any payment or performance under any agreement or instrument
that is part of the Trust Estate, the Indenture Trustee may take such action as
may be appropriate to enforce such payment or performance, including the
institution and prosecution of appropriate Proceedings. Any such action shall be
without prejudice to any right to claim a Default or Event of Default under this
Indenture and any right to proceed thereafter as provided in Article V.
Section 8.02. RESERVED.
Section 8.03. OFFICER'S CERTIFICATE. The Indenture Trustee shall receive at
least seven days prior written notice when requested by the Issuer to take any
action pursuant to Section 8.05(a), accompanied by copies of any instruments to
be executed; and the Indenture Trustee shall require, as a condition to such
action, an Officer's Certificate in form and substance satisfactory to the
Indenture Trustee stating the legal effect of any such action, outlining the
steps required to complete the same and concluding that all conditions precedent
to the taking of such action have been satisfied.
Section 8.04. TERMINATION UPON DISTRIBUTION TO NOTEHOLDERS. This Indenture
and the respective obligations and responsibilities of the Issuer and the
Indenture Trustee created hereby shall terminate upon the distribution to
Noteholders and the Indenture Trustee of all amounts required to be distributed
pursuant to Article III or Article V.
Section 8.05. RELEASE OF TRUST ESTATE.
(a) Subject to the payment of its fees and expenses, the Indenture Trustee
may, and when required by the provisions of this Indenture shall, execute
instruments to release property from the Lien of this Indenture, or convey the
Indenture Trustee's interest in the same, in a manner and under circumstances
that are not inconsistent with the provisions of this Indenture. No party
relying upon an instrument executed by the Indenture Trustee as provided in
Article VIII shall be bound to ascertain the Indenture Trustee's authority,
inquire into the satisfaction of any conditions precedent or see to the
application of any monies.
(b) The Indenture Trustee shall, at such time as (i) there are no Notes
Outstanding and (ii) all sums due the Indenture Trustee pursuant to this
Indenture have been paid, release any remaining portion of the Trust Estate that
secured the Notes from the Lien of this Indenture.
(c) The Indenture Trustee shall release property from the Lien of this
Indenture pursuant to this Section only upon receipt of an Issuer Request.
Section 8.06. SURRENDER OF NOTES UPON FINAL PAYMENT. By acceptance of any
Note, the Holder thereof agrees to surrender such Note to the Indenture Trustee
promptly, prior to such Noteholder's receipt of the final payment thereon.
ARTICLE IX
SUPPLEMENTAL INDENTURES
Section 9.01. SUPPLEMENTAL INDENTURES WITHOUT CONSENT OF NOTEHOLDERS.
Without the consent of the Holders of any Notes, but with prior written notice
to each Rating Agency, the Issuer and the Indenture Trustee, when authorized by
an Issuer Request, at any time and from time to time, may enter into one or more
indentures supplemental hereto (which shall conform to the provisions of the
Trust Indenture Act as in force at the date of the execution thereof), in form
satisfactory to the Indenture Trustee, for any of the following purposes:
(a) to correct or amplify the description of any property at any time
subject to the Lien of this Indenture, or better to assure, convey and confirm
unto the Indenture Trustee any property subject or required to be subjected to
the Lien of this Indenture, or to subject to the Lien of this Indenture
additional property;
(b) to evidence the succession, in compliance with the applicable
provisions hereof, of another Person to the Issuer, and the assumption by any
such successor of the covenants of the Issuer herein and in the Notes contained;
(c) to add to the covenants of the Issuer for the benefit of the
Noteholders, or to surrender any right or power herein conferred upon the
Issuer;
(d) to convey, transfer, assign, mortgage or pledge any property to or with
the Indenture Trustee;
(e) to cure any ambiguity, to correct or supplement any provision herein or
in any supplemental indenture that may be inconsistent with any other provision
herein or in any supplemental indenture;
(f) to make any other provisions with respect to matters or questions
arising under this Indenture or in any supplemental indenture; provided, that
such action shall not materially and adversely affect the interests of the
Senior Noteholders;
(g) to evidence and provide for the acceptance of the appointment hereunder
by a successor trustee with respect to the Notes and to add to or change any of
the provisions of this Indenture as shall be necessary to facilitate the
administration of the trusts hereunder by more than one trustee, pursuant to the
requirements of Article VI; or
(h) to modify, eliminate or add to the provisions of this Indenture to such
extent as shall be necessary to effect the qualification of this Indenture under
the TIA or under any similar federal statute hereafter enacted and to add to
this Indenture such other provisions as may be expressly required by the TIA;
provided, however, that no such supplemental indentures shall be entered
into unless the Indenture Trustee shall have received (1) an Opinion of
Counsel to the effect that entering into such supplemental indenture will
not have any material adverse tax consequence to the Noteholders or (2)
confirmation from the Rating Agencies that such Supplemental Indenture will
not result in a Rating Event.
The Indenture Trustee is hereby authorized to join in the execution of any
such supplemental indenture and to make any further appropriate agreements and
stipulations that may be therein contained.
Section 9.02. SUPPLEMENTAL INDENTURES WITH CONSENT OF NOTEHOLDERS. The
Issuer and the Indenture Trustee, when authorized by an Issuer Request, may,
with prior written notice to each Rating Agency and with the consent of the
Holders of Notes representing not less than a majority of the aggregate Note
Balance of (i) the Class A Notes if any of the Class A Notes are the only Notes
affected thereby, (2) the Subordinate Notes if any Subordinate Notes are the
only Notes affected thereby and (3) the Notes if Subordinate Notes and Class A
Notes are both affected thereby, by Act of such Noteholders delivered to the
Issuer and the Indenture Trustee, enter into an indenture or indentures
supplemental hereto for the purpose of adding any provision to, or changing in
any manner or eliminating any of the provisions of, this Indenture or of
modifying in any manner the rights of the Noteholders under this Indenture;
provided, that no such supplemental indenture may, without the consent of the
Holder of each Note affected thereby:
(a) change the date of payment of any installment of principal of or
interest on any Note, reduce the principal amount thereof or the interest rate
thereon, change the provisions of this Indenture relating to the application of
collections on or the proceeds of the sale of the Trust Estate to payment of
principal of or interest on the Notes, change any place of payment where, or the
coin or currency in which, any Note or the interest thereon is payable, or
impair the right to institute suit for the enforcement of the provisions of this
Indenture requiring the application of funds available therefor, as provided in
Article V, to the payment of any such amount due on the Notes on or after the
respective due dates thereof;
(b) reduce the percentage of the Note Balances or Percentage Interest of
the Notes, the consent of the Holders of which is required for any such
supplemental indenture or for any waiver of compliance with certain provisions
of this Indenture or certain defaults hereunder and their consequences provided
for in this Indenture;
(c) modify or alter the provisions of the proviso to the definition of the
term "Outstanding" or modify or alter the exception in the definition of the
term "Holder";
(d) reduce the percentage of the aggregate Note Balance or the Percentage
Interest with respect to which the consent of the Holders of Notes representing
such Note Balance is required to direct the Indenture Trustee to direct the
Issuer to sell or liquidate the Trust Estate pursuant to Section 5.04;
(e) modify any provision of this Section except to increase any percentage
specified herein or to provide that certain additional provisions of this
Indenture or the other Basic Documents cannot be modified or waived without the
consent of the Holder of each Note affected thereby;
(f) modify any provision of this Indenture in such a manner as to affect
the calculation of the amount of any payment of interest or principal due on any
Note on any Payment Date (including the calculation of any of the individual
components of such calculation); or
(g) permit the creation of any Lien ranking prior to or on a parity with
the Lien of this Indenture with respect to any part of the Trust Estate or,
except as otherwise permitted or contemplated herein, terminate the Lien of this
Indenture on any property at any time subject hereto or deprive the Holder of
any Note of the security provided by the Lien of this Indenture; and provided
further, that such action shall not, as evidenced by an Opinion of Counsel,
cause the Issuer to be subject to an entity level tax.
The Indenture Trustee may in its discretion determine whether or not any
Notes would be affected by any supplemental indenture, and any such
determination shall be conclusive upon all Noteholders, whether theretofore or
thereafter authenticated and delivered hereunder. The Indenture Trustee shall
not be liable for any such determination made in good faith.
It shall not be necessary for any Act of Noteholders under this Section to
approve the particular form of any proposed supplemental indenture, but it shall
be sufficient if such Act shall approve the substance thereof.
Promptly after the execution by the Issuer and the Indenture Trustee of any
supplemental indenture pursuant to this Section, the Indenture Trustee shall
mail to the Noteholders to which such amendment or supplemental indenture
relates a notice setting forth in general terms the substance of such
supplemental indenture. Notwithstanding the foregoing, any failure of the
Indenture Trustee to mail such notice or any defect therein shall not in any way
impair or affect the validity of any such supplemental indenture.
Section 9.03. EXECUTION OF SUPPLEMENTAL INDENTURES. In executing or
permitting the additional trusts created by any supplemental indenture permitted
by this Article or the modification thereby of the trusts created by this
Indenture, the Indenture Trustee shall be entitled to receive, and subject to
Sections 6.01 and 6.02, shall be fully protected in relying upon, an Opinion of
Counsel stating that the execution of such supplemental indenture is authorized
or permitted by this Indenture. The Indenture Trustee may, but shall not be
obligated to, enter into any such supplemental indenture that affects the
Indenture Trustee's own rights, duties, liabilities or immunities under this
Indenture or otherwise.
Section 9.04. EFFECT OF SUPPLEMENTAL INDENTURE. Upon the execution of any
supplemental indenture pursuant to the provisions hereof, this Indenture shall
be and shall be deemed to be modified and amended in accordance therewith with
respect to the Notes affected thereby; and the respective rights, limitations of
rights, obligations, duties, liabilities and immunities under this Indenture of
the Indenture Trustee, the Issuer and the Noteholders shall thereafter be
determined, exercised and enforced hereunder subject in all respects to such
modifications and amendments, and all terms and conditions of any such
supplemental indenture shall be and be deemed to be part of the terms and
conditions of this Indenture for any and all purposes.
Section 9.05. CONFORMITY WITH TRUST INDENTURE ACT. Each amendment of this
Indenture and every supplemental indenture executed pursuant to this Article
shall conform to the requirements of the TIA as then in effect for so long as
this Indenture shall then be qualified under the TIA.
Section 9.06. REFERENCE IN NOTES TO SUPPLEMENTAL INDENTURES. Notes
authenticated and delivered after the execution of any supplemental indenture
pursuant to this Article may, and, if required by the Indenture Trustee, shall,
bear a notation in form approved by the Indenture Trustee as to any matter
provided for in such supplemental indenture. If the Issuer or the Indenture
Trustee shall so determine, new Notes so modified as to conform, in the opinion
of the Indenture Trustee and the Issuer, to any such supplemental indenture may
be prepared and executed by the Issuer and authenticated and delivered by the
Indenture Trustee in exchange for Outstanding Notes.
ARTICLE X
MISCELLANEOUS
Section 10.01. COMPLIANCE CERTIFICATES AND OPINIONS, ETC.
(a) Upon any application or request by the Issuer to the Indenture Trustee
to take any action under any provision of this Indenture, the Issuer shall
furnish to the Indenture Trustee (i) an Officer's Certificate stating that all
conditions precedent, if any, provided for in this Indenture relating to the
proposed action have been complied with and (ii) an Opinion of Counsel stating
that in the opinion of such counsel all such conditions precedent, if any, have
been complied with, except that, in the case of any such application or request
as to which the furnishing of such documents is specifically required by any
provision of this Indenture, no additional certificate or opinion need be
furnished.
Every certificate or opinion with respect to compliance with a condition or
covenant provided for in this Indenture shall include:
(i) a statement that each signatory of such certificate or opinion has
read or has caused to be read such covenant or condition and the
definitions herein relating thereto;
(ii) a brief statement as to the nature and scope of the examination
or investigation upon which the statements or opinions contained in such
certificate or opinion are based;
(iii) a statement that, in the opinion of each such signatory, such
signatory has made such examination or investigation as is necessary to
enable such signatory to express an informed opinion as to whether or not
such covenant or condition has been complied with;
(iv) a statement as to whether, in the opinion of each such signatory,
such condition or covenant has been complied with; and
(v) if the signer of such certificate or opinion is required to be
Independent, the statement required by the definition of the term
"Independent".
(b) Prior to the deposit of any Collateral or other property or securities
with the Indenture Trustee that is to be made as the basis for the release of
any property or securities subject to the Lien of this Indenture, the Issuer
shall, in addition to any obligation imposed in Section 10.01(a) or elsewhere in
this Indenture, furnish to the Indenture Trustee an Officer's Certificate
certifying or stating the opinion of each person signing such certificate as to
the fair value (within 90 days of such deposit) to the Issuer of the Collateral
or other property or securities to be so deposited.
(c) Whenever the Issuer is required to furnish to the Indenture Trustee an
Officer's Certificate certifying or stating the opinion of any signer thereof as
to the matters described in paragraph (b) above, the Issuer shall also deliver
to the Indenture Trustee an Independent Certificate as to the same matters, if
the fair value to the Issuer of the securities to be so deposited and of all
other such securities made as the basis of any such withdrawal or release since
the commencement of the then-current fiscal year of the Issuer, as set forth in
the certificates delivered pursuant to paragraph (b) above and this paragraph,
is 10% or more of the aggregate Note Balance, but such a certificate need not be
furnished with respect to any securities so deposited, if the fair value thereof
to the Issuer as set forth in the related Officer's Certificate is less than
$25,000 or less than one percent of the aggregate Note Balance.
(d) Whenever any property or securities are to be released from the Lien of
this Indenture, the Issuer shall also furnish to the Indenture Trustee an
Officer's Certificate certifying or stating the opinion of each person signing
such certificate as to the fair value (within 90 days of such release) of the
property or securities proposed to be released and stating that in the opinion
of such person the proposed release will not impair the security under this
Indenture in contravention of the provisions hereof.
(e) Whenever the Issuer is required to furnish to the Indenture Trustee an
Officer's Certificate certifying or stating the opinion of any signer thereof as
to the matters described in paragraph (d) above, the Issuer shall also furnish
to the Indenture Trustee an Independent Certificate as to the same matters if
the fair value of the property or securities and of all other property, other
than property as contemplated by paragraph (f) below or securities released from
the Lien of this Indenture since the commencement of the then-current calendar
year, as set forth in the certificates required by paragraph (d) above and this
paragraph equals 10% or more of the aggregate Note Balance, but such certificate
need not be furnished in the case of any release of property or securities if
the fair value thereof as set forth in the related Officer's Certificate is less
than $25,000 or less than one percent of the aggregate Note Balance.
(f) Notwithstanding any provision of this Indenture, the Issuer may,
without compliance with the requirements of the other provisions of this
Section, (i) collect, sell or otherwise dispose of the Mortgage Loans as and to
the extent permitted or required by the Basic Documents or (ii) make cash
payments out of the Trustee Collection Account as and to the extent permitted or
required by the Basic Documents, so long as the Issuer shall deliver to the
Indenture Trustee every six months, commencing December 31, 2001, an Officer's
Certificate of the Issuer stating that all the dispositions of Collateral
described in clauses (i) or (ii) above that occurred during the preceding six
calendar months were in the ordinary course of the Issuer's business and that
the proceeds thereof were applied in accordance with the Basic Documents.
Section 10.02. FORM OF DOCUMENTS DELIVERED TO INDENTURE TRUSTEE. In any
case where several matters are required to be certified by, or covered by an
opinion of, any specified Person, it is not necessary that all such matters be
certified by, or covered by the opinion of, only one such Person, or that they
be so certified or covered by only one document, but one such Person may certify
or give an opinion with respect to some matters and one or more other such
Persons as to other matters, and any such Person may certify or give an opinion
as to such matters in one or several documents.
Any certificate or opinion of an Authorized Officer of the Issuer may be
based, insofar as it relates to legal matters, upon a certificate or opinion of,
or representations by, counsel, unless such officer knows, or in the exercise of
reasonable care should know, that the certificate or opinion or representations
with respect to the matters upon which his certificate or opinion is based are
erroneous. Any such certificate of an Authorized Officer or Opinion of Counsel
may be based, insofar as it relates to factual matters, upon a certificate or
opinion of, or representations by, an officer or officers of the Transferor, the
Depositor or the Issuer, stating that the information with respect to such
factual matters is in the possession of the Transferor, the Depositor or the
Issuer, unless such counsel knows, or in the exercise of reasonable care should
know, that the certificate or opinion or representations with respect to such
matters are erroneous.
Where any Person is required to make, give or execute two or more
applications, requests, consents, certificates, statements, opinions or other
instruments under this Indenture, they may, but need not, be consolidated and
form one instrument.
Whenever in this Indenture, in connection with any application or
certificate or report to the Indenture Trustee, it is provided that the Issuer
shall deliver any document as a condition of the granting of such application,
or as evidence of the Issuer's compliance with any term hereof, it is intended
that the truth and accuracy, at the time of the granting of such application or
at the effective date of such certificate or report (as the case may be), of the
facts and opinions stated in such document shall in such case be conditions
precedent to the right of the Issuer to have such application granted or to the
sufficiency of such certificate or report. The foregoing shall not, however, be
construed to affect the Indenture Trustee's right to rely upon the truth and
accuracy of any statement or opinion contained in any such document as provided
in Article VI.
Section 10.03. ACTS OF NOTEHOLDERS.
(a) Any request, demand, authorization, direction, notice, consent, waiver
or other action provided by this Indenture to be given or taken by the
Noteholders may be embodied in and evidenced by one or more instruments of
substantially similar tenor signed by such Noteholders in person or by agents
duly appointed in writing; and except as herein otherwise expressly provided,
such action shall become effective when such instrument or instruments are
delivered to the Indenture Trustee; and, where it is hereby expressly required,
to the Issuer. Such instrument or instruments (and the action embodied therein
and evidenced thereby) are herein referred to as the "Act" of the Noteholders
signing such instrument or instruments. Proof of execution of any such
instrument or of a writing appointing any such agent shall be sufficient for any
purpose of this Indenture and, subject to Section 6.01, shall be conclusive in
favor of the Indenture Trustee and the Issuer, if made in the manner provided in
this Section.
(b) The fact and date of the execution by any Person of any such instrument
or writing may be proved in any manner that the Indenture Trustee deems
sufficient.
(c) The Note Register shall prove ownership of Notes.
(d) Any request, demand, authorization, direction, notice, consent, waiver
or other action by any Noteholder shall bind the Holder of every Note issued
upon the registration thereof or in exchange therefor or in lieu thereof, in
respect of anything done, omitted or suffered to be done by the Indenture
Trustee or the Issuer in reliance thereon, whether or not notation of such
action is made upon such Note.
Section 10.04. NOTICES. Notices required to be given hereunder shall be
given in the manner set forth in Section 8.03 of the Sale and Servicing
Agreement.
Section 10.05. NOTICES TO NOTEHOLDERS; WAIVER. Where this Indenture
provides for notice to Noteholders of any event, such notice shall be
sufficiently given (unless otherwise herein expressly provided) if in writing
and mailed, first-class, postage prepaid to each Noteholder's address as it
appears on the Note Register, not later than the latest date, and not earlier
than the earliest date, prescribed for the giving of such notice. In any case
where notice to Noteholders is given by mail, neither the failure to mail such
notice nor any defect in any notice so mailed to any Noteholder shall affect the
sufficiency of such notice with respect to other Noteholders, and any notice
that is mailed in the manner herein provided shall conclusively be presumed to
have been duly given regardless of whether such notice is in fact actually
received.
Where this Indenture provides for notice in any manner, any Person entitled
to receive such notice may waive such notice in writing, either before or after
the event, and such waiver shall be the equivalent of such notice. Waivers of
notice by Noteholders shall be filed with the Indenture Trustee, but such filing
shall not be a condition precedent to the validity of any action taken in
reliance upon such waiver.
In case, by reason of the suspension of regular mail service as a result of
a strike, work stoppage or similar activity, it shall be impractical to mail
notice of any event to Noteholders when such notice is required to be given
pursuant to any provision of this Indenture, then any manner of giving such
notice as shall be satisfactory to the Indenture Trustee shall be deemed to be a
sufficient giving of such notice.
Where this Indenture provides for notice to each Rating Agency, failure to
give such notice shall not affect any other rights or obligations created
hereunder, and shall not under any circumstance constitute an Event of Default.
Section 10.06. CONFLICT WITH TRUST INDENTURE ACT. If any provision hereof
limits, qualifies or conflicts with any other provision hereof that is required
to be included in this Indenture by any of the provisions of the Trust Indenture
Act, such required provision shall control.
The provisions of TIA ss.ss.310 through 317 that impose duties on any
Person (including the provisions automatically deemed included herein unless
expressly excluded hereby) are a part of and govern this Indenture, whether or
not physically contained herein.
Section 10.07. EFFECT OF HEADINGS. The Article and Section headings herein
are for convenience only and shall not affect the construction hereof.
Section 10.08. SUCCESSORS AND ASSIGNS. All covenants and agreements in this
Indenture and the Notes of the Issuer shall bind its successors and assigns,
whether or not so expressed. All agreements of the Indenture Trustee in this
Indenture shall bind its successors, co-trustees and agents.
Section 10.09. SEVERABILITY OF PROVISIONS. If any one or more of the
covenants, agreements, provisions or terms of this Indenture shall be for any
reason whatsoever held invalid, then such covenants, agreements, provisions or
terms shall be deemed severable from the remaining covenants, agreements,
provisions or terms of this Indenture, and shall in no way affect the validity
or enforceability of the other provisions of this Indenture or of the Notes or
the rights of the Noteholders.
Section 10.10. BENEFITS OF INDENTURE. Nothing in this Indenture or in the
Notes, express or implied, shall give to any Person, other than the parties
hereto and their successors hereunder, and the Noteholders, and any other party
secured hereunder, and any other Person with an ownership interest in any part
of the Trust Estate, any benefit or any legal or equitable right, remedy or
claim under this Indenture.
Section 10.11. LEGAL HOLIDAYS. In any case where the date on which any
payment is due shall not be a Business Day, then (notwithstanding any other
provision of the Notes or this Indenture) payment need not be made on such date,
but may be made on the next succeeding Business Day with the same force and
effect as if made on the date on which nominally due, and no interest shall
accrue for the period from and after any such nominal date.
Section 10.12. GOVERNING LAW. THIS INDENTURE SHALL BE CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT CONSIDERATION OF THE
CHOICE OF LAW PRINCIPLES THEREOF, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF
THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
Section 10.13. COUNTERPARTS. This Indenture may be executed in any number
of counterparts, each of which so executed shall be deemed to be an original,
but all such counterparts shall together constitute but one and the same
instrument.
Section 10.14. RECORDING OF INDENTURE. If this Indenture is subject to
recording in any appropriate public recording offices, such recording is to be
effected by the Issuer and at its expense accompanied by an Opinion of Counsel
(which may be counsel to the Indenture Trustee or any other counsel reasonably
acceptable to the Indenture Trustee) to the effect that such recording is
necessary either for the protection of the Noteholders or any other Person
secured hereunder or for the enforcement of any right or remedy granted to the
Indenture Trustee under this Indenture.
Section 10.15. ISSUER OBLIGATION. No recourse may be taken, directly or
indirectly, with respect to the obligations of the Issuer, the Owner Trustee or
the Indenture Trustee on the Notes or under this Indenture or any certificate or
other writing delivered in connection herewith or therewith, against (i) the
Indenture Trustee or the Owner Trustee in its individual capacity, (ii) any
owner of a beneficial interest in the Issuer or (iii) any partner, owner,
beneficiary, agent, officer, director, employee or agent of the Indenture
Trustee or the Owner Trustee in its individual capacity, any holder of a
beneficial interest in the Issuer, the Owner Trustee or the Indenture Trustee or
of any successor or assign of the Indenture Trustee or the Owner Trustee in its
individual capacity, except as any such Person may have expressly agreed (it
being understood that the Indenture Trustee and the Owner Trustee have no such
obligations in their respective individual capacities) and except that any such
partner, owner or beneficiary shall be fully liable, to the extent provided by
applicable law, for any unpaid consideration for stock, unpaid capital
contribution or failure to pay any installment or call owing to such entity. For
all purposes of this Indenture, in the performance of any duties or obligations
of the Issuer hereunder, the Owner Trustee shall be subject to, and entitled to
the benefits of, the terms and provisions of Articles V, VI and VII of the Trust
Agreement.
Section 10.16. NO PETITION. The Indenture Trustee, by entering into this
Indenture, and each Noteholder, by its acceptance of a Note, hereby covenant and
agree that they will not at any time institute against the Depositor or the
Issuer, or join in any institution against the Depositor or the Issuer of, any
bankruptcy, reorganization, arrangement, insolvency or liquidation Proceedings,
or other Proceedings under any federal or state bankruptcy or similar law in
connection with any obligation relating to the Notes, this Indenture or any of
the other Basic Documents.
Section 10.17. INSPECTION. The Issuer agrees that, on reasonable prior
written notice, it will permit any representative of the Indenture Trustee,
during the Issuer's normal business hours, to examine all the books of account,
records, reports and other papers of the Issuer, to make copies and extracts
therefrom, to cause such books to be audited by Independent certified public
accountants, and to discuss the Issuer's affairs, finances and accounts with the
Issuer's officers, employees, and Independent certified public accountants, all
at such reasonable times and as often as may be reasonably requested. The
Indenture Trustee shall, and shall cause its representatives to, hold in
confidence all such information except to the extent disclosure may be required
by applicable law (and all reasonable applications for confidential treatment
are unavailing), and except to the extent the Indenture Trustee may reasonably
determine that such disclosure is consistent with its obligations hereunder.
IN WITNESS WHEREOF, the Issuer and the Indenture Trustee have caused their
names to be signed hereto by their respective officers thereunto duly
authorized, all as of the day and year first above written.
XXXXX HOME EQUITY LOAN TRUST 2001-2,
as Issuer
By: WILMINGTON TRUST COMPANY,
not in its individual capacity
but solely as Owner Trustee
By: ______________________________
Name:
Title:
XXXXX FARGO BANK MINNESOTA,
NATIONAL ASSOCIATION,
as Indenture Trustee
By: ______________________________
Name:
Title:
XXXXX FARGO BANK MINNESOTA,
NATIONAL ASSOCIATION hereby
accepts the appointment as
Paying Agent pursuant to
Section 3.03 hereof and as
Note Registrar pursuant
to Section 4.02 hereof.
By: ______________________________
Name:
Title:
STATE OF _________ )
) SS.:
COUNTY OF _______ )
On this __ day of September, 2001, before me personally appeared _______,
to me known, who being by me duly sworn, did depose and say, that he resides at
_______, that he is the ______of Xxxxx Fargo Bank Minnesota, National
Association, as Indenture Trustee, one of the parties described in and that
executed the above instrument; that he knows the seal of said party; that the
seal affixed to said instrument is the seal of such party; that it was so
affixed by order of said party; and that he signed his name thereto by like
order.
Sworn to and subscribed before me this ____ day of September, 2001, by
_________________.
_________________________________
Notary Public
Name: ___________________________
[Notarial Seal] My Commission Expires: __________
EXHIBIT A-1
FORM OF CLASS [[I] [II] [III] A-[ ]] [[M][B]-[--]] NOTE
UNLESS THIS CLASS [[I] [II] [III] A-[ ]] [[M][B]-[--]] NOTE IS PRESENTED BY
AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK
CORPORATION ("DTC"), TO THE ISSUER OR ITS AGENT FOR REGISTRATION OF TRANSFER,
EXCHANGE OR PAYMENT, AND ANY CLASS [[I] [II] [III] A-[ ]] [[M][B]-[--]] NOTE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO
CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
THE PRINCIPAL OF THIS CLASS [[I] [II] [III] A-[ ]] [[M][B]-[--]] NOTE IS
PAYABLE IN INSTALLMENTS AS SET FORTH HEREIN. ACCORDINGLY, THE OUTSTANDING
PRINCIPAL AMOUNT OF THIS CLASS [[I] [II] [III] A-[ ]] [[M][B]-[--]] NOTE AT ANY
TIME MAY BE LESS THAN THE AMOUNT SHOWN ON THE FACE HEREOF.
THIS CLASS [[I] [II] [III] A-[ ]] [[M][B]-[--]] NOTE DOES NOT REPRESENT AN
INTEREST IN OR OBLIGATION OF THE TRANSFEROR, THE DEPOSITOR, THE MASTER SERVICER,
THE INDENTURE TRUSTEE, THE OWNER TRUSTEE OR ANY OF THEIR RESPECTIVE AFFILIATES,
EXCEPT AS EXPRESSLY PROVIDED IN THE INDENTURE OR THE OTHER BASIC DOCUMENTS.
XXXXX HOME EQUITY LOAN TRUST 2001-2
HOME EQUITY LOAN-BACKED TERM NOTE, SERIES 2001-2
Registered
No. [[I] [II] [III] A-[ ]] [[M][B]-[--]] Percentage Interest: 100%
Term Note Balance: $
Note Rate: As set forth herein. CUSIP NO.
First Payment Date: October 25, 2001
Legal Final Payment Date: _____________
Xxxxx Home Equity Loan Trust 2001-2, a business trust duly organized and
existing under the laws of the State of Delaware (the "Issuer"), for value
received, hereby promises to pay to Cede & Co. or its registered assigns,
the principal sum of ________ Million Dollars ($ ) payable on each Payment
Date in an amount equal to the Percentage Interest specified above of the
aggregate amount, if any, payable in respect of principal of the Class [[I]
[II] [III] A-[ ]] [[M][B]-[--]] Notes pursuant to Section 3.05 of the
Indenture dated as of August 31, 2001 (the "Indenture"), between the Issuer
and Xxxxx Fargo Bank Minnesota, National Association, as indenture trustee
(the "Indenture Trustee"); provided, however, that the entire unpaid
principal amount of this Class [[I] [II] [III] A-[ ]] [[M][B]-[--]] Note
shall be due and payable on the ________ ___, _____ Payment Date to the
extent not previously paid on a prior Payment Date. Capitalized terms used
herein that are not otherwise defined shall have the meanings ascribed
thereto in Appendix A to the Indenture.
Interest on the Class [[I] [II] [III] A-[ ]] [[M][B]-[--]] Notes will be
paid monthly on each Payment Date at the Note Rate for the related Interest
Period. Interest on this Class [[I] [II] [III] A-[ ]] [[M][B]-[--]] Note will
accrue at the Note Rate for the Class [ ] A-[ ] Notes [[M][B]--[--]]. Principal
of and interest on this Class [[I] [II] [III] A-[ ]] [[M][B]-[--]] Note shall be
paid in the manner specified on the reverse hereof. "Payment Date" means the
25th day of each month or, if any such day is not a Business Day, the
immediately succeeding Business Day.
If an Event of Default shall have occurred and be continuing, then the
Indenture Trustee or the Holders of Notes representing not less than a majority
of the aggregate Note Balance of the Class A Notes or Subordinate Notes may
declare the Notes to be immediately due and payable in the manner provided in
Section 5.02 of the Indenture.
Principal of and interest on this Class [[I] [II] [III] A-[ ]]
[[M][B]-[--]] Note will be payable in such coin or currency of the United States
of America as at the time of payment is legal tender for payment of public and
private debts. All payments made by the Issuer with respect to this Class [[I]
[II] [III] A-[ ]] [[M][B]-[--]] Note will generally be applied first to interest
due and payable on this Class [[I] [II] [III] A-[ ]] [[M][B]-[--]] Note as
provided above and then to the unpaid principal of this Class [[I] [II] [III]
A-[ ]] [[M][B]-[--]] Note.
Reference is made to the further provisions of this Class [[I] [II] [III]
A-[ ]] [[M][B]-[--]] Note set forth on the reverse hereof, which shall have the
same effect as though fully set forth on the face of this Class [[I] [II] [III]
A-[ ]] [[M][B]-[--]] Note.
Unless the Indenture Trustee has executed the certificate of authentication
hereon by manual signature, this Class [[I] [II] [III] A-[ ]] [[M][B]-[--]] Note
shall not be entitled to any benefit under the Indenture, or be valid or
obligatory for any purpose.
REVERSE OF CLASS [[I] [II] [III] A-[ ]] [[M][B]-[--]] NOTE
This Class [[I] [II] [III] A-[ ]] [[M][B]-[--]] Note is one of a duly
authorized issue of Class [[I] [II] [III] A-[ ]] [[M][B]-[--]] Notes of the
Issuer, designated as its Home Equity Loan-Backed Term Notes, Series 2001-2 (the
"Class [[I] [II] [III] A-[ ]] [[M][B]-[--]] Notes"), all issued under the
Indenture, to which Indenture and all indentures supplemental thereto reference
is hereby made for a statement of the respective rights and obligations
thereunder of the Issuer, the Indenture Trustee and the Noteholders. The Class
[[I] [II] [III] A-[ ]] [[M][B]-[--]] Notes are subject to all of the terms of
the Indenture.
The Class M-1 Notes are subordinate to the Class A Notes, the Class M-2
Notes are subordinate to the Class A Notes and the Class M-1 Notes and the Class
B-1 Notes are subordinate to the Class A Notes, the Class M-1 Notes and the
Class M-2 Notes, in each case to the extent specified in the Indenture.
This Class [[I] [II] [III] A-[ ]] [[M][B]-[--]] Note may be transferred by
a written instrument of transfer in form satisfactory to the Indenture Trustee
duly executed by the Holder hereof or such Holder's attorney duly authorized in
writing, with such signature guaranteed by an "eligible guarantor institution"
meeting the requirements of the Note Registrar, which requirements include
membership or participation in the Securities Transfer Agent's Medallion Program
("STAMP") or such other "signature guarantee program" as may be determined by
the Note Registrar in addition to, or in substitution for, STAMP, all in
accordance with the Securities Exchange Act of 1934, as amended, and thereupon
one or more new Class [[I] [II] [III] A-[ ]] [[M][B]-[--]] Notes in authorized
denominations and in the same aggregate principal amount will be issued to the
designated transferee or transferees. No service charge will be charged for any
registration of transfer or exchange of this Class [[I] [II] [III] A-[ ]]
[[M][B]-[--]] Note, but the Note Registrar may require payment of a sum
sufficient to cover any tax or governmental charge that may be imposed in
connection with any registration of transfer or exchange of this Class [[I] [II]
[III] A-[ ]] [[M][B]-[--]] Note.
Each Holder or Beneficial Owner of a Class [[I] [II] [III] A-[ ]]
[[M][B]-[--]] Note, by its acceptance of a Class [[I] [II] [III] A-[ ]]
[[M][B]-[--]] Note (or, in the case of a Beneficial Owner of a Class [[I] [II]
[III] A-[ ]] [[M][B]-[--]] Note, a beneficial interest in such Class [[I] [II]
[III] A-[ ]] [[M][B]-[--]] Note) covenants and agrees that no recourse may be
taken, directly or indirectly, with respect to the obligations of the Issuer,
the Owner Trustee, the Transferor, the Master Servicer, the Depositor or the
Indenture Trustee on the Class [[I] [II] [III] A-[ ]] [[M][B]-[--]] Notes or
under the Indenture or any certificate or other writing delivered in connection
therewith, against (i) the Indenture Trustee or the Owner Trustee in their
respective individual capacities, (ii) any owner of a beneficial interest in the
Issuer or (iii) any partner, owner, beneficiary, agent, officer, director or
employee of the Indenture Trustee or the Owner Trustee in its individual
capacity, any holder of a beneficial interest in the Issuer, the Owner Trustee
or the Indenture Trustee or any successor or assign of the Indenture Trustee or
the Owner Trustee in their respective individual capacities, except as any such
Person may have expressly agreed, and provided that any such partner, owner or
beneficiary shall be fully liable, to the extent provided by applicable law, for
any unpaid consideration for stock, unpaid capital contribution or failure to
pay any installment or call owing to such entity.
Each Beneficial Owner or Class [[I] [II] [III] A-[ ]] [[M][B]-[--]]
Noteholder, by its acceptance of a Class [[I] [II] [III] A-[ ]] [[M][B]-[--]]
Note (or, in the case of a Beneficial Owner of a Class [[I] [II] [III] A-[ ]]
[[M][B]-[--]] Note, a beneficial interest in such Class [[I] [II] [III] A-[ ]]
[[M][B]-[--]] Note) covenants and agrees by accepting the benefits of the
Indenture that such Class [[I] [II] [III] A-[ ]] [[M][B]-[--]] Noteholder or
Beneficial Owner will not at any time institute against the Depositor, the
Transferor, the Master Servicer or the Issuer, or join in any institution
against the Depositor, the Transferor, the Master Servicer or the Issuer of, any
bankruptcy, reorganization, arrangement, insolvency or liquidation proceedings
under any federal or state bankruptcy or similar law in connection with any
obligation relating to the Class [[I] [II] [III] A-[ ]] [[M][B]-[--]] Notes, the
Indenture or the other Basic Documents.
The Issuer has entered into the Indenture, and this Class [[I] [II] [III]
A-[ ]] [[M][B]-[--]] Note is issued with the intention that, for federal, state
and local income, single business and franchise tax purposes, the Class [[I]
[II] [III] A-[ ]] [[M][B]-[--]] Notes will qualify as indebtedness of the
Issuer. Each Class [[I] [II] [III] A-[ ]] [[M][B]-[--]] Noteholder, by its
acceptance of a Class [[I] [II] [III] A-[ ]] [[M][B]-[--]] Note (and each
Beneficial Owner of a Class [[I] [II] [III] A-[ ]] [[M][B]-[--]] Note by its
acceptance of a beneficial interest in such Class [[I] [II] [III] A-[ ]]
[[M][B]-[--]] Note), agrees to treat the Class [[I] [II] [III] A-[ ]]
[[M][B]-[--]] Notes for federal, state and local income, single business and
franchise tax purposes as indebtedness of the Issuer.
Prior to the due presentment for registration of transfer of this Class
[[I] [II] [III] A-[ ]] [[M][B]-[--]] Note, the Issuer, the Indenture Trustee and
any agent thereof may treat the Person in the name of which this Class [[I] [II]
[III] A-[ ]] [[M][B]-[--]] Note is registered (as of the date of determination
or as of such other date as may be specified in the Indenture) as the owner
hereof for all purposes, whether or not this Class [[I] [II] [III] A-[ ]]
[[M][B]-[--]] Note shall be overdue; and none of the Issuer, the Indenture
Trustee or any such agent shall be affected by notice to the contrary.
The Indenture permits, with certain exceptions as therein provided, the
amendment thereof and the modification of the rights and obligations of the
Issuer and the Indenture Trustee and the rights of the Class [[I] [II] [III] A-[
]] [[M][B]-[--]] Noteholders under the Indenture at any time by the Issuer and
the Indenture Trustee with prior written notice to each Rating Agency and with
the consent of the Holders of Notes representing not less than a majority of the
aggregate Note Balance of the Notes affected thereby. The Indenture also
contains provisions permitting the Holders of Notes representing a specified
percentage of the aggregate Note Balance, on behalf of all Noteholders, to waive
compliance by the Issuer with certain provisions of the Indenture and certain
past defaults under the Indenture and their consequences. Any such consent or
waiver by the Holder of this Class [[I] [II] [III] A-[ ]] [[M][B]-[--]] Note (or
any one or more Predecessor Notes) shall be conclusive and binding upon such
Holder and upon all future Holders of this Class [[I] [II] [III] A-[ ]]
[[M][B]-[--]] Note and of any Class [[I] [II] [III] A-[ ]] [[M][B]-[--]] Note
issued upon the registration of transfer hereof or in exchange hereof or in lieu
hereof whether or not notation of such consent or waiver is made hereon. The
Indenture also permits the Issuer and the Indenture Trustee to amend or waive
certain terms and conditions set forth in the Indenture without the consent of
the Noteholders, but with prior written notice to each Rating Agency.
The term "Issuer" as used in this Class [[I] [II] [III] A-[ ]]
[[M][B]-[--]] Note includes any successor to the Issuer under the Indenture.
The Issuer is permitted by the Indenture, under certain circumstances, to
merge or consolidate, subject to the rights of the Indenture Trustee and the
Noteholders under the Indenture.
The Notes are issuable only in registered form in denominations as provided
in the Indenture, subject to certain limitations therein set forth.
This Class [[I] [II] [III] A-[ ]] [[M][B]-[--]] Note and the Indenture
shall be construed in accordance with the laws of the State of New York, and the
obligations, rights and remedies of the parties hereunder and thereunder shall
be determined in accordance with such laws.
No reference herein to the Indenture and no provision of this Class [[I]
[II] [III] A-[ ]] [[M][B]-[--]] Note or of the Indenture shall alter or impair
the obligation of the Issuer, which is absolute and unconditional, to pay the
principal of and interest on this Class [[I] [II] [III] A-[ ]] [[M][B]-[--]]
Note at the times, place and rate and in the coin or currency herein prescribed.
Anything herein to the contrary notwithstanding, except as expressly
provided in the Basic Documents, none of Wilmington Trust Company or Xxxxx Fargo
Bank Minnesota, National Association in their respective individual capacities,
any owner of a beneficial interest in the Issuer, or any of their respective
partners, beneficiaries, agents, officers, directors, employees or successors or
assigns shall be personally liable for, nor shall recourse be had to any of them
for, the payment of principal of or interest on this Class [[I] [II] [III] A-[
]] [[M][B]-[--]] Note or performance of, or omission to perform, any of the
covenants, obligations or indemnifications contained in the Indenture. The
Holder of this Class [[I] [II] [III] A-[ ]] [[M][B]-[--]] Note, by its
acceptance hereof, agrees that, except as expressly provided in the Basic
Documents, in the case of an Event of Default under the Indenture, such Holder
shall have no claim against any of the foregoing for any deficiency, loss or
claim therefrom; provided, however, that nothing contained herein shall be taken
to prevent recourse to, and enforcement against, the assets of the Issuer for
any and all liabilities, obligations and undertakings contained in the Indenture
or in this Class [[I] [II] [III] A-[ ]] [[M][B]-[--]] Note.
IN WITNESS WHEREOF, the Owner Trustee, on behalf of the Issuer and not in
its individual capacity, has caused this Class [[I] [II] [III] A-[ ]]
[[M][B]-[--]] Note to be duly executed.
XXXXX HOME EQUITY LOAN TRUST 2001-2
By: WILMINGTON TRUST COMPANY, not in its
individual capacity but solely as
Owner Trustee
By: ___________________________________
Authorized Signatory
Dated: ___, ___________.
CERTIFICATE OF AUTHENTICATION
This is one of the Class [[I] [II] [III] A-[ ]] [[M][B]-[--]] Notes
referred to in the within-mentioned Indenture.
XXXXX FARGO BANK MINNESOTA, NATIONAL
ASSOCIATION, not in its individual
capacity but solely as Indenture Trustee
By: ___________________________________
Authorized Signatory
Dated: ___, ___________.
ASSIGNMENT
Social Security or taxpayer I.D. or other identifying number of assignee:
__________________________________________________________________
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfer unto
_______________________________________________________________________________
_______________________________________________________________________________
(name and address of assignee)
the within Note and all rights thereunder, and hereby irrevocably
constitutes and appoints _________________________, attorney, to transfer said
Note on the books kept for registration thereof, with full power of substitution
in the premises.
Dated: ______________________________ _______________________________________*/
_______________________________________*/
---------------------------
* NOTICE: The signature to this assignment must correspond with the name of
the registered owner as it appears on the face of the within Note in every
particular, without alteration, enlargement or any change whatever. Such
signature must be guaranteed by an "eligible guarantor institution" meeting
the requirements of the Note Registrar, which requirements include
membership or participation in STAMP or such other "signature guarantee
program" as may be determined by the Note Registrar in addition to, or in
substitution for, STAMP, all in accordance with the Securities Exchange Act
of 1934, as amended.
EXHIBIT A-2
FORM OF CLASS A-IO NOTE
UNLESS THIS CLASS A-IO NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE ISSUER OR
ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CLASS A-IO
NOTE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO
CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
PRINCIPAL SHALL NOT BE PAYABLE IN RESPECT OF THIS NOTE. INTEREST IS
CALCULATED ON THIS NOTE BASED ON THE NOTIONAL AMOUNT SPECIFIED HEREIN.
THIS CLASS A-IO NOTE DOES NOT REPRESENT AN INTEREST IN OR OBLIGATION OF THE
TRANSFEROR, THE DEPOSITOR, THE MASTER SERVICER, THE INDENTURE TRUSTEE, THE OWNER
TRUSTEE OR ANY OF THEIR RESPECTIVE AFFILIATES, EXCEPT AS EXPRESSLY PROVIDED IN
THE INDENTURE OR THE OTHER BASIC DOCUMENTS.
XXXXX HOME EQUITY LOAN TRUST 2001-2
HOME EQUITY LOAN-BACKED TERM NOTE, SERIES 2001-2
Registered
No. A-IO-1 Percentage Interest: 100%
Initial Notional Balance: $54,112,000
Note Rate: As set forth herein. CUSIP NO.
First Payment Date: October 25, 2001
Legal Final Payment Date: March 25, 2004
Xxxxx Home Equity Loan Trust 2001-2, a business trust duly organized and
existing under the laws of the State of Delaware (the "Issuer"), for value
received, hereby promises to pay to Cede & Co. or its registered assigns,
an amount equal to the Percentage Interest specified above of the aggregate
amount, if any, payable in respect of the Class A-IO Notes pursuant to
Section 3.05 of the Indenture dated as of August 31, 2001 (the
"Indenture"), between the Issuer and Xxxxx Fargo Bank Minnesota, National
Association, as indenture trustee (the "Indenture Trustee"); provided,
however, that no amount in respect of this Class A-IO Note shall be payable
after the March 2004 Payment Date. Capitalized terms used herein that are
not otherwise defined shall have the meanings ascribed thereto in Appendix
A to the Indenture.
Interest on the Class A-IO Notes will be paid monthly on each Payment Date
at the Note Rate times the Class A-IO Notional Balance for the related Interest
Period. Interest on the Class A-IO Notional Balance of this Class A-IO Note will
accrue at the Note Rate for each Payment Date from the most recent Payment Date
on which interest has been paid (in the case of the first Payment Date, from the
Closing Date) to but excluding such Payment Date. The "Note Rate" for each
Interest Period will be 10.000% per annum. Interest will be computed on the
basis of an assumed year of 360 days consisting of twelve 30-day months.
Interest on this Class A-IO Note shall be paid in the manner specified on the
reverse hereof. "Payment Date" means the 25th day of each month or, if any such
day is not a Business Day, the immediately succeeding Business Day.
If an Event of Default shall have occurred and be continuing, then the
Indenture Trustee or the Holders of Notes representing not less than a majority
of the aggregate Note Balance of the Class A Notes or Subordinate Notes may
declare all Notes to be immediately due and payable in the manner provided in
Section 5.02 of the Indenture.
Interest on this Class A-IO Note will be payable in such coin or currency
of the United States of America as at the time of payment is legal tender for
payment of public and private debts.
Reference is made to the further provisions of this Class A-IO Note set
forth on the reverse hereof, which shall have the same effect as though fully
set forth on the face of this Class A-IO Note.
Unless the Indenture Trustee has executed the certificate of authentication
hereon by manual signature, this Class A-IO Note shall not be entitled to any
benefit under the Indenture, or be valid or obligatory for any purpose.
REVERSE OF CLASS A-IO NOTE
This Class A-IO Note is one of a duly authorized issue of Class A-IO Notes
of the Issuer, designated as its Home Equity Loan-Backed Notes, Series 2001-2
(the "Class A-IO Notes"), all issued under the Indenture, to which Indenture and
all indentures supplemental thereto reference is hereby made for a statement of
the respective rights and obligations thereunder of the Issuer, the Indenture
Trustee and the Noteholders. The Class A-IO Notes are subject to all of the
terms of the Indenture.
This Class A-IO Note may be transferred by a written instrument of transfer
in form satisfactory to the Indenture Trustee duly executed by the Holder hereof
or such Holder's attorney duly authorized in writing, with such signature
guaranteed by an "eligible guarantor institution" meeting the requirements of
the Note Registrar, which requirements include membership or participation in
the Securities Transfer Agent's Medallion Program ("STAMP") or such other
"signature guarantee program" as may be determined by the Note Registrar in
addition to, or in substitution for, STAMP, all in accordance with the
Securities Exchange Act of 1934, as amended, and thereupon one or more new Class
A-IO Notes in authorized denominations and in the same aggregate percentage
interest will be issued to the designated transferee or transferees. No service
charge will be charged for any registration of transfer or exchange of this
Class A-IO Note, but the Note Registrar may require payment of a sum sufficient
to cover any tax or governmental charge that may be imposed in connection with
any registration of transfer or exchange of this Class A-IO Note.
Each Holder or Beneficial Owner of a Class A-IO Note, by its acceptance of
a Class A-IO Note (or, in the case of a Beneficial Owner of a Class A-IO Note, a
beneficial interest in such Class A-IO Note) covenants and agrees that no
recourse may be taken, directly or indirectly, with respect to the obligations
of the Issuer, the Owner Trustee, the Transferor, the Master Servicer, the
Depositor or the Indenture Trustee on the Class A-IO Notes or under the
Indenture or any certificate or other writing delivered in connection therewith,
against (i) the Indenture Trustee or the Owner Trustee in their respective
individual capacities, (ii) any owner of a beneficial interest in the Issuer or
(iii) any partner, owner, beneficiary, agent, officer, director or employee of
the Indenture Trustee or the Owner Trustee in its individual capacity, any
holder of a beneficial interest in the Issuer, the Owner Trustee or the
Indenture Trustee or any successor or assign of the Indenture Trustee or the
Owner Trustee in their respective individual capacities, except as any such
Person may have expressly agreed, and provided that any such partner, owner or
beneficiary shall be fully liable, to the extent provided by applicable law, for
any unpaid consideration for stock, unpaid capital contribution or failure to
pay any installment or call owing to such entity.
Each Beneficial Owner or Class A-IO Noteholder, by its acceptance of a
Class A-IO Note (or, in the case of a Beneficial Owner of a Class A-IO Note, a
beneficial interest in such Class A-IO Note) covenants and agrees by accepting
the benefits of the Indenture that such Class A-IO Noteholder or Beneficial
Owner will not at any time institute against the Depositor, the Transferor, the
Master Servicer or the Issuer, or join in any institution against the Depositor,
the Transferor, the Master Servicer or the Issuer of, any bankruptcy,
reorganization, arrangement, insolvency or liquidation proceedings under any
federal or state bankruptcy or similar law in connection with any obligation
relating to the Class A-IO Notes, the Indenture or the other Basic Documents.
The Issuer has entered into the Indenture, and this Class A-IO Note is
issued with the intention that, for federal, state and local income, single
business and franchise tax purposes, the Class A-IO Notes will qualify as
indebtedness of the Issuer. Each Class A-IO Noteholder, by its acceptance of a
Class A-IO Note (and each Beneficial Owner of a Class A-IO Note by its
acceptance of a beneficial interest in such Class A-IO Note), agrees to treat
the Class A-IO Notes for federal, state and local income, single business and
franchise tax purposes as indebtedness of the Issuer.
Prior to the due presentment for registration of transfer of this Class
A-IO Note, the Issuer, the Indenture Trustee and any agent thereof may treat the
Person in the name of which this Class A-IO Note is registered (as of the date
of determination or as of such other date as may be specified in the Indenture)
as the owner hereof for all purposes, whether or not this Class A-IO Note shall
be overdue; and none of the Issuer, the Indenture Trustee or any such agent
shall be affected by notice to the contrary.
The Indenture permits, with certain exceptions as therein provided, the
amendment thereof and the modification of the rights and obligations of the
Issuer and the Indenture Trustee and the rights of the Class A-IO Noteholders
under the Indenture at any time by the Issuer and the Indenture Trustee with
prior written notice to each Rating Agency and with the consent of the Holders
of Notes representing not less than a majority of the aggregate Note Balance of
the Notes affected thereby. The Indenture also contains provisions permitting
the Holders of Notes representing a specified percentage of the aggregate Note
Balance, on behalf of all Noteholders, to waive compliance by the Issuer with
certain provisions of the Indenture and certain past defaults under the
Indenture and their consequences. Any such consent or waiver by the Holder of
this Class A-IO Note (or any one or more Predecessor Notes) shall be conclusive
and binding upon such Holder and upon all future Holders of this Class A-IO Note
and of any Class A-IO Note issued upon the registration of transfer hereof or in
exchange hereof or in lieu hereof whether or not notation of such consent or
waiver is made hereon. The Indenture also permits the Issuer and the Indenture
Trustee to amend or waive certain terms and conditions set forth in the
Indenture without the consent of the Noteholders, but with prior written notice
to each Rating Agency.
The term "Issuer" as used in this Class A-IO Note includes any successor to
the Issuer under the Indenture.
The Issuer is permitted by the Indenture, under certain circumstances, to
merge or consolidate, subject to the rights of the Indenture Trustee and the
Noteholders under the Indenture.
The Notes are issuable only in registered form in denominations as provided
in the Indenture, subject to certain limitations therein set forth.
This Class A-IO Note and the Indenture shall be construed in accordance
with the laws of the State of New York, and the obligations, rights and remedies
of the parties hereunder and thereunder shall be determined in accordance with
such laws.
No reference herein to the Indenture and no provision of this Class A-IO
Note or of the Indenture shall alter or impair the obligation of the Issuer,
which is absolute and unconditional, to pay interest on this Class A-IO Note at
the times, place and rate and in the coin or currency herein prescribed.
Anything herein to the contrary notwithstanding, except as expressly
provided in the Basic Documents, none of Wilmington Trust Company or Xxxxx Fargo
Bank Minnesota, National Association in their respective individual capacities,
any owner of a beneficial interest in the Issuer, or any of their respective
partners, beneficiaries, agents, officers, directors, employees or successors or
assigns shall be personally liable for, nor shall recourse be had to any of them
for, the payment of interest on this Class A-IO Note or performance of, or
omission to perform, any of the covenants, obligations or indemnifications
contained in the Indenture. The Holder of this Class A-IO Note, by its
acceptance hereof, agrees that, except as expressly provided in the Basic
Documents, in the case of an Event of Default under the Indenture, such Holder
shall have no claim against any of the foregoing for any deficiency, loss or
claim therefrom; provided, however, that nothing contained herein shall be taken
to prevent recourse to, and enforcement against, the assets of the Issuer for
any and all liabilities, obligations and undertakings contained in the Indenture
or in this Class A-IO Note.
IN WITNESS WHEREOF, the Owner Trustee, on behalf of the Issuer and not in
its individual capacity, has caused this Class A-IO Note to be duly executed.
XXXXX HOME EQUITY LOAN TRUST 2001-2
By: WILMINGTON TRUST COMPANY, not in its
individual capacity but solely as
Owner Trustee
By: ___________________________________
Authorized Signatory
Dated: ___, ___________.
CERTIFICATE OF AUTHENTICATION
This is one of the Class A-IO Notes referred to in the within-mentioned
Indenture.
XXXXX FARGO BANK MINNESOTA, NATIONAL
ASSOCIATION, not in its individual
capacity but solely as Indenture Trustee
By: ___________________________________
Authorized Signatory
Dated: ___, ___________.
ASSIGNMENT
Social Security or taxpayer I.D. or other identifying number of assignee:
__________________________________________________________________
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfer unto
________________________________________________________________________________
________________________________________________________________________________
(name and address of assignee)
the within Note and all rights thereunder, and hereby irrevocably
constitutes and appoints _________________________, attorney, to transfer said
Note on the books kept for registration thereof, with full power of substitution
in the premises.
Dated: __________________________________ ___________________________________*/
___________________________________*/
---------------------------
* NOTICE: The signature to this assignment must correspond with the name of
the registered owner as it appears on the face of the within Note in every
particular, without alteration, enlargement or any change whatever. Such
signature must be guaranteed by an "eligible guarantor institution" meeting
the requirements of the Note Registrar, which requirements include
membership or participation in STAMP or such other "signature guarantee
program" as may be determined by the Note Registrar in addition to, or in
substitution for, STAMP, all in accordance with the Securities Exchange Act
of 1934, as amended.
EXHIBIT A-3a
FORM OF VARIABLE FUNDING NOTE
THIS VARIABLE FUNDING NOTE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED, OR THE SECURITIES LAWS OF ANY STATE
AND MAY NOT BE RESOLD OR TRANSFERRED UNLESS IT IS REGISTERED PURSUANT TO
SUCH ACT AND LAWS OR IS SOLD OR TRANSFERRED IN TRANSACTIONS WHICH ARE
EXEMPT FROM REGISTRATION UNDER SUCH ACT AND UNDER APPLICABLE STATE LAW AND
IS TRANSFERRED IN ACCORDANCE WITH THE PROVISIONS OF SECTION 4.02 OF THE
INDENTURE REFERRED TO HEREIN.
THE PRINCIPAL OF THIS VARIABLE FUNDING NOTE IS PAYABLE IN INSTALLMENTS AS
SET FORTH HEREIN. ACCORDINGLY, THE OUTSTANDING PRINCIPAL AMOUNT OF THIS
VARIABLE FUNDING NOTE AT ANY TIME MAY BE LESS THAN THE AMOUNT SHOWN ON THE
FACE HEREOF.
THIS VARIABLE FUNDING NOTE DOES NOT REPRESENT AN INTEREST IN OR OBLIGATION
OF THE SELLER, THE DEPOSITOR, THE MASTER SERVICER, THE INDENTURE TRUSTEE,
THE OWNER TRUSTEE OR ANY OF THEIR RESPECTIVE AFFILIATES, EXCEPT AS
EXPRESSLY PROVIDED IN THE INDENTURE OR THE OTHER BASIC DOCUMENTS.
XXXXX HOME EQUITY LOAN TRUST 2001-2
HOME EQUITY LOAN-BACKED VARIABLE FUNDING NOTE, SERIES 2001-2
No. VFN-___
Note Rate: as set forth herein.
Initial Variable Funding Balance: $0
Xxxxx Home Equity Loan Trust 2001-2, a business trust duly organized and
existing under the laws of the State of Delaware (herein referred to as the
"Issuer"), for value received, hereby promises to pay to Xxxxx Union Bank
and Trust Company or its registered assigns, the principal amount set forth
on Schedule A attached hereto (or otherwise owing hereunder as determined
pursuant to the Indenture), payable on each Payment Date in an amount equal
to the pro rata portion allocable hereto (based on the Variable Funding
Balances of all Variable Funding Notes immediately prior to such Payment
Date) of the aggregate amount, if any, payable in respect of principal of
the Variable Funding Notes pursuant to Section 3.05 of the indenture dated
as of August 31, 2001 (the "Indenture"), between the Issuer and Xxxxx Fargo
Bank Minnesota, National Association, as indenture trustee (the "Indenture
Trustee"); provided, however, that the entire unpaid principal amount of
this Variable Funding Note shall be due and payable on the February 25,
2012 Payment Date to the extent not previously paid on a prior Payment
Date. Capitalized terms used herein that are not otherwise defined shall
have the meaning set forth in Appendix A to the Indenture.
Interest on this Variable Funding Note will be paid monthly on each Payment
Date at the Note Rate for the related Interest Period subject to
limitations that may result in Interest Carry-Forward Amounts (as further
described in the Indenture). Interest on this Variable Funding Note will
accrue for each Payment Date from the most recent Payment Date on which
interest has been paid (in the case of the first Payment Date, from the
Closing Date) to but excluding such Payment Date. Interest will be computed
on the basis of the actual number of days in each Interest Period and
360-day year.
Principal of and interest on this Variable Funding Note will be payable on
the related Payment Date as described in the Indenture. "Payment Date"
means the 25th day of each month or, if any such day is not a Business Day,
the immediately succeeding Business Day.
If an Event of Default shall have occurred and be continuing, then the
Indenture Trustee or the Holders of Notes representing not less than a
majority of the aggregate Note Balance of the Class A Notes or the
Subordinate Notes may declare the Notes to be immediately due and payable
in the manner provided in Section 5.02 of the Indenture. All principal
payments on the Variable Funding Notes shall be made pro rata to the
Holders of Variable Funding Notes entitled thereto.
Payments of interest on this Variable Funding Note due and payable on each
Payment Date, together with the installment of principal, if any, to the
extent not in full payment of this Variable Funding Note, shall be made by
check mailed to the Person whose name appears as the Registered Holder of
this Variable Funding Note (or one or more Predecessor Notes) on the Note
Register as of the close of business on each Record Date. Any reduction in
the principal amount of this Variable Funding Note (or any one or more
Predecessor Notes) effected by any payments made on any Payment Date shall
be binding upon all future Holders of this Variable Funding Note and of any
Variable Funding Note issued upon the registration of transfer hereof or in
exchange hereof or in lieu hereof, whether or not noted hereon. If funds
are expected to be available, as provided in the Indenture, for payment in
full of the then remaining unpaid principal amount of this Variable Funding
Note on a Payment Date, then the Indenture Trustee, in the name of and on
behalf of the Issuer, will notify the Person who was the Registered Holder
hereof as of the Record Date preceding such Payment Date by notice mailed
or transmitted by facsimile prior to such Payment Date and the amount then
due and payable shall be payable only upon presentation and surrender of
this Variable Funding Note at the address specified in such notice of final
payment.
Principal of and interest on this Variable Funding Note will be payable in
such coin or currency of the United States of America as at the time of
payment is legal tender for payment of public and private debts. All
payments made by the Issuer with respect to this Variable Funding Note will
generally be applied first to interest due and payable on this Variable
Funding Note and then to the unpaid principal of this Variable Funding
Note.
Reference is made to the further provisions of this Variable Funding Note
set forth on the reverse hereof, which shall have the same effect as though
fully set forth on the face of this Variable Funding Note.
Unless the certificate of authentication hereon has been executed by the
Indenture Trustee by manual signature, this Variable Funding Note shall not
be entitled to any benefit under the Indenture, or be valid or obligatory
for any purpose.
[REVERSE OF VARIABLE FUNDING NOTE]
This Variable Funding Note is one of a duly authorized issue of Variable
Funding Notes of the Issuer, designated as its Home Equity Loan-Backed
Variable Funding Notes, Series 2001-2 (the "Variable Funding Notes"), all
issued under the Indenture, to which Indenture and all indentures
supplemental thereto reference is hereby made for a statement of the
respective rights and obligations thereunder of the Issuer, the Indenture
Trustee and the Holders of the Variable Funding Notes. The Variable Funding
Notes are subject to all terms of the Indenture.
The Variable Funding Notes and the Term Notes (collectively, the "Notes")
are and will be equally and ratably secured by the collateral pledged as
security therefor as provided in the Indenture.
As provided in the Indenture and subject to certain limitations set forth
therein, the transfer of this Variable Funding Note may be registered on
the Note Register upon surrender of this Variable Funding Note for
registration of transfer at the Corporate Trust Office of the Indenture
Trustee, duly endorsed by, and accompanied by a written instrument of
transfer in form satisfactory to the Indenture Trustee duly executed by,
the Holder hereof or such Holder's attorney duly authorized in writing,
with such signature guaranteed by an "eligible guarantor institution"
meeting the requirements of the Note Registrar, which requirements include
membership or participation in the Securities Transfer Agent's Medallion
Program ("STAMP") or such other "signature guarantee program" as may be
determined by the Note Registrar in addition to or in substitution for,
STAMP, all in accordance with the Securities Exchange Act of 1934, as
amended, and thereupon one or more new Variable Funding Notes in authorized
denominations and in the same aggregate principal amount will be issued to
the designated transferee or transferees. No service charge will be charged
for any registration of transfer or exchange of this Variable Funding Note,
but the Note Registrar shall require payment of a sum sufficient to cover
any tax or governmental charge that may be imposed in connection with any
registration of transfer or exchange of this Variable Funding Note.
Each Holder of a Variable Funding Note, by its acceptance of a Variable
Funding Note, covenants and agrees that no recourse may be taken, directly
or indirectly, with respect to the obligations of the Issuer, the Owner
Trustee, the Seller, the Master Servicer, the Depositor or the Indenture
Trustee on the Variable Funding Notes or under the Indenture or any
certificate or other writing delivered in connection therewith, against (i)
the Indenture Trustee or the Owner Trustee in its individual capacity, (ii)
any owner of a beneficial interest in the Issuer or (iii) any partner,
owner, beneficiary, agent, officer, director or employee of the Indenture
Trustee or the Owner Trustee in its individual capacity, any holder of a
beneficial interest in the Issuer, the Owner Trustee or the Indenture
Trustee or of any successor or assign of the Indenture Trustee or the Owner
Trustee in its individual capacity, except as any such Person may have
expressly agreed and except that any such partner, owner or beneficiary
shall be fully liable, to the extent provided by applicable law, for any
unpaid consideration for stock, unpaid capital contribution or failure to
pay any installment or call owing to such entity.
Each Holder of a Variable Funding Note, by its acceptance of a Variable
Funding Note, covenants and agrees by accepting the benefits of the
Indenture that such Holder will not at any time institute against the
Depositor, the Seller, the Master Servicer or the Issuer, or join in any
institution against the Depositor, the Seller, the Master Servicer or the
Issuer of, any bankruptcy, reorganization, arrangement, insolvency or
liquidation proceedings under any federal or state bankruptcy or similar
law in connection with any obligations relating to the Variable Funding
Notes, the Indenture or the other Basic Documents.
The Issuer has entered into the Indenture and this Variable Funding Note is
issued with the intention that, for federal, state and local income, single
business and franchise tax purposes, the Variable Funding Notes will
qualify as indebtedness of the Issuer. Each Holder of a Variable Funding
Note, by its acceptance of a Variable Funding Note, agrees to treat the
Variable Funding Notes for federal, state and local income, single business
and franchise tax purposes as indebtedness of the Issuer.
Prior to the due presentment for registration of transfer of this Variable
Funding Note, the Issuer, the Indenture Trustee and any agent of the Issuer
or the Indenture Trustee may treat the Person in the name of which this
Variable Funding Note (as of the day of determination or as of such other
date as may be specified in the Indenture) is registered as the owner
hereof for all purposes, whether or not this Variable Funding Note be
overdue, and none of the Issuer, the Indenture Trustee or any such agent
shall be affected by notice to the contrary.
The Indenture permits, with certain exceptions as therein provided, the
amendment thereof and the modification of the rights and obligations of the
Issuer and the Indenture Trustee and the rights of the Holders of the
Variable Funding Notes under the Indenture at any time by the Issuer and
the Indenture Trustee with the consent of the Holders of Notes representing
not less than a majority of the aggregate Note Balance of the Notes
affected thereby, and with prior written notice to each Rating Agency. The
Indenture also contains provisions permitting the Holders of Notes
representing specified aggregate Note Balances, on behalf of all
Noteholders, to waive compliance by the Issuer with certain provisions of
the Indenture and certain past defaults under the Indenture and their
consequences. Any such consent or waiver by the Holder of this Variable
Funding Note (or any one of more Predecessor Notes) shall be conclusive and
binding upon such Holder and upon all future Holders of this Variable
Funding Note and of any Variable Funding Note issued upon the registration
of transfer hereof or in exchange hereof or in lieu hereof whether or not
notation of such consent or waiver is made upon this Variable Funding Note.
The Indenture also permits the Indenture Trustee to amend or waive certain
terms and conditions set forth in the Indenture without the consent of the
Noteholders but with prior written notice to each Rating Agency.
The term "Issuer" as used in this Variable Funding Note includes any
successor to the Issuer under the Indenture.
The Issuer is permitted by the Indenture, under certain circumstances, to
merge or consolidate, subject to the rights of the Indenture Trustee and
the Holders of Variable Funding Notes under the Indenture.
The Variable Funding Notes are issuable only in registered form in
denominations as provided in the Indenture, subject to certain limitations
therein set forth.
This Variable Funding Note and the Indenture shall be construed in
accordance with the laws of the State of New York, and the obligations,
rights and remedies of the parties hereunder and thereunder shall be
determined in accordance with such laws.
No reference herein to the Indenture and no provision of this Variable
Funding Note or of the Indenture shall alter or impair the obligation of
the Issuer, which is absolute and unconditional, to pay the principal of
and interest on this Variable Funding Note at the times, place and rate,
and in the coin or currency herein prescribed.
Anything herein to the contrary notwithstanding, except as expressly
provided in the Basic Documents, none of Wilmington Trust Company or Xxxxx
Fargo Bank Minnesota, National Association in their respective individual
capacities, any owner of a beneficial interest in the Issuer, or any of
their respective partners, beneficiaries, agents, officers, directors,
employees or successors or assigns shall be personally liable for, nor
shall recourse be had to any of them for, the payment of principal of or
interest on this Variable Funding Note or performance of, or omission to
perform, any of the covenants, obligations or indemnifications contained in
the Indenture. The Holder of this Variable Funding Note by its acceptance
hereof agrees that, except as expressly provided in the Basic Documents, in
the case of an Event of Default under the Indenture, such Holder shall have
no claim against any of the foregoing for any deficiency, loss or claim
therefrom; provided, however, that nothing contained herein shall be taken
to prevent recourse to, and enforcement against, the assets of the Issuer
for any and all liabilities, obligations and undertakings contained in the
Indenture or in this Variable Funding Note.
IN WITNESS WHEREOF, the Owner Trustee, on behalf of the Issuer and not in
its individual capacity, has caused this Variable Funding Note to be duly
executed.
XXXXX HOME EQUITY LOAN TRUST 2001-2
By: WILMINGTON TRUST COMPANY, not in its
individual capacity but solely as
Owner Trustee
By: ___________________________________
Authorized Signatory
Dated: ___, ___________.
CERTIFICATE OF AUTHENTICATION
This is one of the Variable Funding Notes referred to in the
within-mentioned Indenture.
XXXXX FARGO BANK MINNESOTA, NATIONAL
ASSOCIATION, not in its individual
capacity but solely as Indenture Trustee
By: ___________________________________
Authorized Signatory
Dated: ___, ___________.
ASSIGNMENT
Social Security or taxpayer I.D. or other identifying number of assignee:
__________________________________________________________________
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfer unto
_______________________________________________________________________________
_______________________________________________________________________________
(name and address of assignee)
the within Note and all rights thereunder, and hereby irrevocably
constitutes and appoints _________________________, attorney, to transfer said
Note on the books kept for registration thereof, with full power of substitution
in the premises.
Dated: __________________________________ ___________________________________*/
___________________________________*/
---------------------------
* NOTICE: The signature to this assignment must correspond with the name of
the registered owner as it appears on the face of the within Note in every
particular, without alteration, enlargement or any change whatever. Such
signature must be guaranteed by an "eligible guarantor institution" meeting
the requirements of the Note Registrar, which requirements include
membership or participation in STAMP or such other "signature guarantee
program" as may be determined by the Note Registrar in addition to, or in
substitution for, STAMP, all in accordance with the Securities Exchange Act
of 1934, as amended.
SCHEDULE A
HOME EQUITY LOAN-BACKED VARIABLE FUNDING NOTES
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VARIABLE FUNDING AUTHORIZED
PERCENTAGE PRINCIPAL BALANCE SIGNATURE OF
DATE INTEREST PAYMENT OUTSTANDING INDENTURE TRUSTEE
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EXHIBIT A-3b
FORM OF CAPPED VARIABLE FUNDING NOTE
THIS CAPPED VARIABLE FUNDING NOTE HAS NOT BEEN AND WILL NOT BE REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR THE SECURITIES LAWS OF ANY
STATE AND MAY NOT BE RESOLD OR TRANSFERRED UNLESS IT IS REGISTERED PURSUANT
TO SUCH ACT AND LAWS OR IS SOLD OR TRANSFERRED IN TRANSACTIONS WHICH ARE
EXEMPT FROM REGISTRATION UNDER SUCH ACT AND UNDER APPLICABLE STATE LAW AND
IS TRANSFERRED IN ACCORDANCE WITH THE PROVISIONS OF SECTION 4.02 OF THE
INDENTURE REFERRED TO HEREIN.
THE PRINCIPAL OF THIS CAPPED VARIABLE FUNDING NOTE IS PAYABLE IN
INSTALLMENTS AS SET FORTH HEREIN. ACCORDINGLY, THE OUTSTANDING PRINCIPAL
AMOUNT OF THIS CAPPED VARIABLE FUNDING NOTE AT ANY TIME MAY BE LESS THAN
THE AMOUNT SHOWN ON THE FACE HEREOF.
THIS CAPPED VARIABLE FUNDING NOTE DOES NOT REPRESENT AN INTEREST IN OR
OBLIGATION OF THE SELLER, THE DEPOSITOR, THE MASTER SERVICER, THE INDENTURE
TRUSTEE, THE OWNER TRUSTEE OR ANY OF THEIR RESPECTIVE AFFILIATES, EXCEPT AS
EXPRESSLY PROVIDED IN THE INDENTURE OR THE OTHER BASIC DOCUMENTS.
XXXXX HOME EQUITY LOAN TRUST 2001-2
HOME EQUITY LOAN-BACKED CAPPED VAIRABLE FUNDING NOTE, SERIES 2001-2
No. VFN Capped -___
Note Rate: as set forth herein.
Initial Principal Balance: ___
Xxxxx Home Equity Loan Trust 2001-2, a business trust duly organized and
existing under the laws of the State of Delaware (herein referred to as the
"Issuer"), for value received, hereby promises to pay to Xxxxx Union Bank
and Trust Company or its registered assigns, the principal amount set forth
on Schedule A attached hereto (or otherwise owing hereunder as determined
pursuant to the Indenture), payable on each Payment Date in an amount equal
to the pro rata portion allocable hereto (based on the Variable Funding
Balances of all Variable Funding Notes immediately prior to such Payment
Date) of the aggregate amount, if any, payable in respect of principal of
the Variable Funding Notes pursuant to Section 3.05 of the indenture dated
as of August 31, 2001 (the "Indenture"), between the Issuer and Xxxxx Fargo
Bank Minnesota, National Association, as indenture trustee (the "Indenture
Trustee"); provided, however, that the entire unpaid principal amount of
this Capped Variable Funding Note shall be due and payable on the February
25, 2012 Payment Date to the extent not previously paid on a prior Payment
Date. Capitalized terms used herein that are not otherwise defined shall
have the meaning set forth in Appendix A to the Indenture.
Interest on this Capped Variable Funding Note will be paid monthly on each
Payment Date at the Note Rate for the related Interest Period subject to
limitations that may result in Interest Carry-Forward Amounts (as further
described in the Indenture). Interest on this Capped Variable Funding Note
will accrue for each Payment Date from the most recent Payment Date on
which interest has been paid (in the case of the first Payment Date, from
the Closing Date) to but excluding such Payment Date. Interest will be
computed on the basis of the actual number of days in each Interest Period
and 360-day year.
Principal of and interest on this Capped Variable Funding Note will be
payable on the related Payment Date as described in the Indenture. "Payment
Date" means the 25th day of each month or, if any such day is not a
Business Day, the immediately succeeding Business Day.
If an Event of Default shall have occurred and be continuing, then the
Indenture Trustee or the Holders of Notes representing not less than a
majority of the aggregate Note Balance of the Class A Notes or the
Subordinate Notes may declare the Notes to be immediately due and payable
in the manner provided in Section 5.02 of the Indenture. All principal
payments on the Variable Funding Notes shall be made pro rata to the
Holders of Variable Funding Notes entitled thereto.
Payments of interest on this Capped Variable Funding Note due and payable
on each Payment Date, together with the installment of principal, if any,
to the extent not in full payment of this Capped Variable Funding Note,
shall be made by check mailed to the Person whose name appears as the
Registered Holder of this Capped Variable Funding Note (or one or more
Predecessor Notes) on the Note Register as of the close of business on each
Record Date. Any reduction in the principal amount of this Capped Variable
Funding Note (or any one or more Predecessor Notes) effected by any
payments made on any Payment Date shall be binding upon all future Holders
of this Capped Variable Funding Note and of any Variable Funding Note
issued upon the registration of transfer hereof or in exchange hereof or in
lieu hereof, whether or not noted hereon. If funds are expected to be
available, as provided in the Indenture, for payment in full of the then
remaining unpaid principal amount of this Capped Variable Funding Note on a
Payment Date, then the Indenture Trustee, in the name of and on behalf of
the Issuer, will notify the Person who was the Registered Holder hereof as
of the Record Date preceding such Payment Date by notice mailed or
transmitted by facsimile prior to such Payment Date and the amount then due
and payable shall be payable only upon presentation and surrender of this
Capped Variable Funding Note at the address specified in such notice of
final payment.
Principal of and interest on this Capped Variable Funding Note will be
payable in such coin or currency of the United States of America as at the
time of payment is legal tender for payment of public and private debts.
All payments made by the Issuer with respect to this Capped Variable
Funding Note will generally be applied first to interest due and payable on
this Capped Variable Funding Note and then to the unpaid principal of this
Capped Variable Funding Note.
Reference is made to the further provisions of this Capped Variable Funding
Note set forth on the reverse hereof, which shall have the same effect as
though fully set forth on the face of this Capped Variable Funding Note.
Unless the certificate of authentication hereon has been executed by the
Indenture Trustee by manual signature, this Capped Variable Funding Note
shall not be entitled to any benefit under the Indenture, or be valid or
obligatory for any purpose.
[REVERSE OF CAPPED VARIABLE FUNDING NOTE]
This Capped Variable Funding Note is one of a duly authorized issue of
Variable Funding Notes of the Issuer, designated as its Home Equity
Loan-Backed Variable Funding Notes, Series 2001-2 (the "Variable Funding
Notes"), all issued under the Indenture, to which Indenture and all
indentures supplemental thereto reference is hereby made for a statement of
the respective rights and obligations thereunder of the Issuer, the
Indenture Trustee and the Holders of the Variable Funding Notes. The
Variable Funding Notes are subject to all terms of the Indenture.
The Variable Funding Notes and the Term Notes (collectively, the "Notes")
are and will be equally and ratably secured by the collateral pledged as
security therefor as provided in the Indenture.
As provided in the Indenture and subject to certain limitations set forth
therein, the transfer of this Capped Variable Funding Note may be
registered on the Note Register upon surrender of this Capped Variable
Funding Note for registration of transfer at the Corporate Trust Office of
the Indenture Trustee, duly endorsed by, and accompanied by a written
instrument of transfer in form satisfactory to the Indenture Trustee duly
executed by, the Holder hereof or such Holder's attorney duly authorized in
writing, with such signature guaranteed by an "eligible guarantor
institution" meeting the requirements of the Note Registrar, which
requirements include membership or participation in the Securities Transfer
Agent's Medallion Program ("STAMP") or such other "signature guarantee
program" as may be determined by the Note Registrar in addition to or in
substitution for, STAMP, all in accordance with the Securities Exchange Act
of 1934, as amended, and thereupon one or more new Variable Funding Notes
in authorized denominations and in the same aggregate principal amount will
be issued to the designated transferee or transferees. No service charge
will be charged for any registration of transfer or exchange of this Capped
Variable Funding Note, but the Note Registrar shall require payment of a
sum sufficient to cover any tax or governmental charge that may be imposed
in connection with any registration of transfer or exchange of this Capped
Variable Funding Note.
Each Holder of a Variable Funding Note, by its acceptance of a Variable
Funding Note, covenants and agrees that no recourse may be taken, directly
or indirectly, with respect to the obligations of the Issuer, the Owner
Trustee, the Seller, the Master Servicer, the Depositor or the Indenture
Trustee on the Variable Funding Notes or under the Indenture or any
certificate or other writing delivered in connection therewith, against (i)
the Indenture Trustee or the Owner Trustee in its individual capacity, (ii)
any owner of a beneficial interest in the Issuer or (iii) any partner,
owner, beneficiary, agent, officer, director or employee of the Indenture
Trustee or the Owner Trustee in its individual capacity, any holder of a
beneficial interest in the Issuer, the Owner Trustee or the Indenture
Trustee or of any successor or assign of the Indenture Trustee or the Owner
Trustee in its individual capacity, except as any such Person may have
expressly agreed and except that any such partner, owner or beneficiary
shall be fully liable, to the extent provided by applicable law, for any
unpaid consideration for stock, unpaid capital contribution or failure to
pay any installment or call owing to such entity.
Each Holder of a Variable Funding Note, by its acceptance of a Variable
Funding Note, covenants and agrees by accepting the benefits of the
Indenture that such Holder will not at any time institute against the
Depositor, the Seller, the Master Servicer or the Issuer, or join in any
institution against the Depositor, the Seller, the Master Servicer or the
Issuer of, any bankruptcy, reorganization, arrangement, insolvency or
liquidation proceedings under any federal or state bankruptcy or similar
law in connection with any obligations relating to the Variable Funding
Notes, the Indenture or the other Basic Documents.
The Issuer has entered into the Indenture and this Capped Variable Funding
Note is issued with the intention that, for federal, state and local
income, single business and franchise tax purposes, the Variable Funding
Notes will qualify as indebtedness of the Issuer. Each Holder of a Variable
Funding Note, by its acceptance of a Variable Funding Note, agrees to treat
the Variable Funding Notes for federal, state and local income, single
business and franchise tax purposes as indebtedness of the Issuer.
Prior to the due presentment for registration of transfer of this Capped
Variable Funding Note, the Issuer, the Indenture Trustee and any agent of
the Issuer or the Indenture Trustee may treat the Person in the name of
which this Capped Variable Funding Note (as of the day of determination or
as of such other date as may be specified in the Indenture) is registered
as the owner hereof for all purposes, whether or not this Capped Variable
Funding Note be overdue, and none of the Issuer, the Indenture Trustee or
any such agent shall be affected by notice to the contrary.
The Indenture permits, with certain exceptions as therein provided, the
amendment thereof and the modification of the rights and obligations of the
Issuer and the Indenture Trustee and the rights of the Holders of the
Variable Funding Notes under the Indenture at any time by the Issuer and
the Indenture Trustee with the consent of the Holders of Notes representing
not less than a majority of the aggregate Note Balance of the Notes
affected thereby, and with prior written notice to each Rating Agency. The
Indenture also contains provisions permitting the Holders of Notes
representing specified aggregate Note Balances, on behalf of all
Noteholders, to waive compliance by the Issuer with certain provisions of
the Indenture and certain past defaults under the Indenture and their
consequences. Any such consent or waiver by the Holder of this Capped
Variable Funding Note (or any one of more Predecessor Notes) shall be
conclusive and binding upon such Holder and upon all future Holders of this
Capped Variable Funding Note and of any Variable Funding Note issued upon
the registration of transfer hereof or in exchange hereof or in lieu hereof
whether or not notation of such consent or waiver is made upon this Capped
Variable Funding Note. The Indenture also permits the Indenture Trustee to
amend or waive certain terms and conditions set forth in the Indenture
without the consent of the Noteholders but with prior written notice to
each Rating Agency.
The term "Issuer" as used in this Capped Variable Funding Note includes any
successor to the Issuer under the Indenture.
The Issuer is permitted by the Indenture, under certain circumstances, to
merge or consolidate, subject to the rights of the Indenture Trustee and
the Holders of Variable Funding Notes under the Indenture.
The Variable Funding Notes are issuable only in registered form in
denominations as provided in the Indenture, subject to certain limitations
therein set forth.
This Capped Variable Funding Note and the Indenture shall be construed in
accordance with the laws of the State of New York, and the obligations,
rights and remedies of the parties hereunder and thereunder shall be
determined in accordance with such laws.
No reference herein to the Indenture and no provision of this Capped
Variable Funding Note or of the Indenture shall alter or impair the
obligation of the Issuer, which is absolute and unconditional, to pay the
principal of and interest on this Capped Variable Funding Note at the
times, place and rate, and in the coin or currency herein prescribed.
Anything herein to the contrary notwithstanding, except as expressly
provided in the Basic Documents, none of Wilmington Trust Company or Xxxxx
Fargo Bank Minnesota, National Association in their respective individual
capacities, any owner of a beneficial interest in the Issuer, or any of
their respective partners, beneficiaries, agents, officers, directors,
employees or successors or assigns shall be personally liable for, nor
shall recourse be had to any of them for, the payment of principal of or
interest on this Capped Variable Funding Note or performance of, or
omission to perform, any of the covenants, obligations or indemnifications
contained in the Indenture. The Holder of this Capped Variable Funding Note
by its acceptance hereof agrees that, except as expressly provided in the
Basic Documents, in the case of an Event of Default under the Indenture,
such Holder shall have no claim against any of the foregoing for any
deficiency, loss or claim therefrom; provided, however, that nothing
contained herein shall be taken to prevent recourse to, and enforcement
against, the assets of the Issuer for any and all liabilities, obligations
and undertakings contained in the Indenture or in this Capped Variable
Funding Note.
IN WITNESS WHEREOF, the Owner Trustee, on behalf of the Issuer and not in
its individual capacity, has caused this Capped Variable Funding Note to be duly
executed.
XXXXX HOME EQUITY LOAN TRUST 2001-2
By: WILMINGTON TRUST COMPANY, not in its
individual capacity but solely as
Owner Trustee
By: ___________________________________
Authorized Signatory
Dated:
CERTIFICATE OF AUTHENTICATION
This is one of the Capped Variable Funding Notes referred to in the
within-mentioned Indenture.
XXXXX FARGO BANK MINNESOTA, NATIONAL
ASSOCIATION, not in its individual
capacity but solely as Indenture Trustee
By: ___________________________________
Authorized Signatory
Dated:
ASSIGNMENT
Social Security or taxpayer I.D. or other identifying number of assignee:
__________________________________________________________________
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfer unto
_______________________________________________________________________________
_______________________________________________________________________________
(name and address of assignee)
the within Note and all rights thereunder, and hereby irrevocably
constitutes and appoints _________________________, attorney, to transfer said
Note on the books kept for registration thereof, with full power of substitution
in the premises.
Dated: ______________________________________ _______________________________*/
_______________________________*/
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* NOTICE: The signature to this assignment must correspond with the name of
the registered owner as it appears on the face of the within Note in every
particular, without alteration, enlargement or any change whatever. Such
signature must be guaranteed by an "eligible guarantor institution" meeting
the requirements of the Note Registrar, which requirements include
membership or participation in STAMP or such other "signature guarantee
program" as may be determined by the Note Registrar in addition to, or in
substitution for, STAMP, all in accordance with the Securities Exchange Act
of 1934, as amended.
ASSIGNMENT
Social Security or taxpayer I.D. or other identifying number of assignee:
____________________________________________________________________________
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfer unto
_______________________________________________________________________________
_______________________________________________________________________________
(name and address of assignee)
the within Note and all rights thereunder, and hereby irrevocably
constitutes and appoints _________________________, attorney, to transfer said
Note on the books kept for registration thereof, with full power of substitution
in the premises.
Dated: ______________________________________ _______________________________*/
_______________________________*/
---------------------------
* NOTICE: The signature to this assignment must correspond with the name of
the registered owner as it appears on the face of the within Note in every
particular, without alteration, enlargement or any change whatever. Such
signature must be guaranteed by an "eligible guarantor institution" meeting
the requirements of the Note Registrar, which requirements include
membership or participation in STAMP or such other "signature guarantee
program" as may be determined by the Note Registrar in addition to, or in
substitution for, STAMP, all in accordance with the Securities Exchange Act
of 1934, as amended.
EXHIBIT B
[FORM OF RULE 144A INVESTMENT REPRESENTATION]
Description of Rule 144A Securities, including numbers:
__________________________
__________________________
__________________________
__________________________
The undersigned seller, as registered holder (the "Seller"), intends to
transfer the Rule 144A Securities described above to the undersigned buyer
(the "Buyer").
(a) In connection with such transfer and in accordance with the agreements
pursuant to which the Rule 144A Securities were issued, the Seller hereby
certifies the following facts: Neither the Seller nor anyone acting on its
behalf has offered, transferred, pledged, sold or otherwise disposed of the Rule
144A Securities, any interest in the Rule 144A Securities or any other similar
security to, or solicited any offer to buy or accept a transfer, pledge or other
disposition of the Rule 144A Securities, any interest in the Rule 144A
Securities or any other similar security from, or otherwise approached or
negotiated with respect to the Rule 144A Securities, any interest in the Rule
144A Securities or any other similar security with, any person in any manner, or
made any general solicitation by means of' general advertising or in any other
manner, or taken any other action, that would constitute a distribution of the
Rule 144A Securities under the Securities Act of 1933, as amended (the "1933
Act"), or that would render the disposition of the Rule 144A Securities a
violation of Section 5 of the 1933 Act or require registration pursuant thereto,
and that the Seller has not offered the Rule 144A Securities to any person other
than the Buyer or another "qualified institutional buyer" as defined in Rule
144A under the 0000 Xxx.
(b) The Buyer warrants and represents to, and covenants with, the Indenture
Trustee and the Issuer (as defined in the Indenture (the "Indenture"), dated as
of February 28, 2001, between Xxxxx Home Equity Loan Trust 2001-2, as Issuer,
and Xxxxx Fargo Bank Minnesota, National Association, as Indenture Trustee),
pursuant to Section 4.02 of the Indenture, as follows:
a. The Buyer understands that the Rule 144A Securities have not been
registered under the 1933 Act or the securities laws of any state.
b. The Buyer considers itself a substantial, sophisticated institutional
investor having such knowledge and experience in financial and business
matters that it is capable of evaluating the merits and risks of investment
in the Rule 144A Securities.
c. The Buyer has been furnished with all information regarding the Rule
144A Securities that it has requested from the Seller, the Indenture
Trustee, the Owner Trustee or the Master Servicer.
d. Neither the Buyer nor anyone acting on its behalf has offered,
transferred, pledged, sold or otherwise disposed of the Rule 144A
Securities, any interest in the Rule 144A Securities or any other similar
security to, or solicited any offer to buy or accept a transfer, pledge or
other disposition of the Rule 144A Securities, any interest in the Rule
144A Securities or any other similar security from, or otherwise approached
or negotiated with respect to the Rule 144A Securities, any interest in the
Rule 144A Securities or any other similar security with, any person in any
manner, or made any general solicitation by means of general advertising or
in any other manner, or taken any other action, that would constitute a
distribution of the Rule 144A Securities under the 1933 Act or that would
render the disposition of the Rule 144A Securities a violation of Section 5
of the 1933 Act or require registration pursuant thereto, nor will it act,
nor has it authorized or will it authorize any person to act, in such
manner with respect to the Rule 144A Securities.
e. The Buyer is a "qualified institutional buyer" as that term is defined
in Rule 144A under the 1933 Act and has completed either of the forms of
certification to that effect attached hereto as Annex 1 or Annex 2. The
Buyer is aware that the sale to it is being made in reliance on Rule 144A.
The Buyer is acquiring the Rule 144A Securities for its own account or the
accounts of other qualified institutional buyers, understands that such
Rule 144A Securities may be resold, pledged or transferred only (i) to a
person reasonably believed to be a qualified institutional buyer that
purchases for its own account or for the account of a qualified
institutional buyer to whom notice is given that the resale, pledge or
transfer is being made in reliance on Rule 144A, or (ii) pursuant to
another exemption from registration under the 1933 Act.
(c) This document may be executed in one or more counterparts and by the
different parties hereto on separate counterparts, each of which, when so
executed, shall be deemed to be an original; such counterparts, together, shall
constitute one and the same document.
IN WITNESS WHEREOF, each of the parties has executed this document as
of the date set forth below.
_____________________________ _________________________________
Print Name of Seller Print Name of Buyer
By: _________________________ By: _____________________________
Name: Name:
Title: Title:
Taxpayer Identification: Taxpayer Identification:
No: _________________________ No: _____________________________
Date: _______________________ Date: ___________________________
ANNEX 1 TO EXHIBIT B
QUALIFIED INSTITUTIONAL BUYER STATUS UNDER SEC RULE 144A
[For Buyers Other Than Registered Investment Companies]
The undersigned hereby certifies as follows in connection with the Rule
144A Investment Representation to which this Certification is attached:
1. As indicated below, the undersigned is the President, Chief Financial
Officer, Senior Vice President or other executive officer of the Buyer.
2. In connection with purchases by the Buyer, the Buyer is a "qualified
institutional buyer" as that term is defined in Rule 144A under the
Securities Act of 1933, as amended ("Rule 144A"), because (i) the Buyer
owned and/or invested on a discretionary basis $_________________* in
securities (except for the excluded securities referred to below) as of the
end of the Buyer's most recent fiscal year (such amount being calculated in
accordance with Rule 144A) and (ii) the Buyer satisfies the criteria in the
category marked below.
___ CORPORATION, ETC. The Buyer is a corporation (other than a bank,
savings and loan association or similar institution), Massachusetts or
similar business trust, partnership, or charitable organization described
in Section 501(c)(3) of the Internal Revenue Code.
___ BANK. The Buyer (i) is a national bank or banking institution organized
under the laws of any State, territory or the District of Columbia, the
business of which is substantially confined to banking and is supervised by
the State or territorial banking commission or similar official or is a
foreign bank or equivalent institution, and (ii) has an audited net worth
of at least $25,000,000 as demonstrated in its latest annual financial
statements, a copy of which is attached hereto.
___ SAVINGS AND LOAN. The Buyer (i) is a savings and loan association,
building and loan association, cooperative bank, homestead association or
similar institution, which is supervised and examined by a state or federal
authority having supervision over any such institutions or is a foreign
savings and loan association or equivalent institution and (ii) has an
audited net worth of at least $25,000,000 as demonstrated in its latest
annual financial statements.
___ BROKER-DEALER. The Buyer is a dealer registered pursuant to Section 15
of the Securities Exchange Act of 1934, as amended.
___ INSURANCE COMPANY. The Buyer is an insurance company whose primary and
predominant business activity is the writing of insurance or the reinsuring
of risks underwritten by insurance companies and which is subject to
supervision by the insurance commissioner or a similar official or agency
of a State or territory of the United States.
___ STATE OR LOCAL PLAN. The Buyer is a plan established and maintained by
a State, its political subdivisions, or any agency or instrumentality of
such State or its political subdivisions, for the benefit of its employees.
___ ERISA PLAN. The Buyer is an employee benefit plan within the meaning of
Title I of the Employee Retirement Income Security Act of 1974, as amended.
___ INVESTMENT ADVISER. The Buyer is an investment adviser registered under
the Investment Advisers Act of 1940, as amended.
___ SBIC. The Buyer is a Small Business Investment Company licensed by the
U.S. Small Business Administration under Section 301(c) or (d) of the Small
Business Investment Act of 1958, as amended.
___ BUSINESS DEVELOPMENT COMPANY. The Buyer is a business development
company as defined in Section 202(a)(22) of the Investment Advisers Act of
1940, as amended.
___ TRUST FUND. The Buyer is a trust fund whose trustee is a bank or trust
company and whose participants are exclusively (i) plans established and
maintained by a State, its political subdivisions, or any agency or
instrumentality of the State or its political subdivisions, for the benefit
of its employees, or (ii) employee benefit plans within the meaning of
Title I of the Employee Retirement Income Security Act of 1974, as amended,
but is not a trust fund that includes as participants individual retirement
accounts or H.R. 10 plans.
3. The term "securities" as used herein does not include (i) securities of
issuers that are affiliated with the Buyer, (ii) securities that are part
of an unsold allotment to or subscription by the Buyer, if the Buyer is a
dealer, (iii) bank deposit notes and certificates of deposit, (iv) loan
participations, (v) repurchase agreements, (vi) securities owned but
subject to a repurchase agreement and (vii) currency, interest rate and
commodity swaps.
4. For purposes of determining the aggregate amount of securities owned
and/or invested on a discretionary basis by the Buyer, the Buyer used the
cost of such securities to the Buyer and did not include any of the
securities referred to in the preceding paragraph. Further, in determining
such aggregate amount, the Buyer may have included securities owned by
subsidiaries of the Buyer, but only if such subsidiaries are consolidated
with the Buyer in its financial statements prepared in accordance with
generally accepted accounting principles and if the investments of such
subsidiaries are managed under the Buyer's direction. However, such
securities were not included if the Buyer is a majority-owned, consolidated
subsidiary of another enterprise and the Buyer is not itself a reporting
company under the Securities Exchange Act of 1934, as amended.
5. The Buyer acknowledges that it is familiar with Rule 144A and
understands that the seller to it and other parties related to the Rule
144A Securities are relying and will continue to rely on the statements
made herein because one or more sales to the Buyer may be in reliance on
Rule 144A.
Yes _____ No ______ Will the Buyer be purchasing the Rule 144A
Securities only for the Buyer's own account?
6. If the answer to the foregoing question is "no", the Buyer agrees that,
in connection with any purchase of securities sold to the Buyer for the
account of a third party (including any separate account) in reliance on
Rule 144A, the Buyer will only purchase for the account of a third party
that at the time is a "qualified institutional buyer" within the meaning of
Rule 144A. In addition, the Buyer agrees that the Buyer will not purchase
securities for a third party unless the Buyer has obtained a current
representation letter from such third party or taken other appropriate
steps contemplated by Rule 144A to conclude that such third party
independently meets the definition of "qualified institutional buyer" set
forth in Rule 144A.
7. The Buyer will notify each of the parties to which this certification is
made of any changes in the information and conclusions herein. Until such
notice is given, the Buyer's purchase of Rule 144A Securities will
constitute a reaffirmation of this certification as of the date of such
purchase.
______________________________________
Print Name of Buyer
By: _________________________________
Name:
Title:
Date:
ANNEX 2 TO EXHIBIT B
QUALIFIED INSTITUTIONAL BUYER STATUS UNDER SEC RULE 144A
[For Buyers that are Registered Investment Companies]
The undersigned hereby certifies as follows in connection with the Rule
144A Investment Representation to which this Certification is attached:
1. As indicated below, the undersigned is the President, Chief Financial
Officer or Senior Vice President of the Buyer or, if the Buyer is a
"qualified institutional buyer" as that term is defined in Rule 144A under
the Securities Act of 1933, as amended ("Rule 144A") because the Buyer is
part of a Family of Investment Companies (as defined below), is such an
officer of the Adviser.
2. In connection with purchases by Buyer, the Buyer is a "qualified
institutional buyer" as defined in SEC Rule 144A because (i) the Buyer is
an investment company registered under the Investment Company Act of 1940,
as amended, and (ii) as marked below, the Buyer alone, or the Buyer's
Family of Investment Companies, owned at least $100,000,000 in securities
(other than the excluded securities referred to below) as of the end of the
Buyer's most recent fiscal year. For purposes of determining the amount of
securities owned by the Buyer or the Buyer's Family of Investment
Companies, the cost of such securities was used.
___ The Buyer owned $____________ in securities (other than the excluded
securities referred to below) as of the end of the Buyer's most recent
fiscal year (such amount being calculated in accordance with Rule 144A).
___ The Buyer is part of a Family of Investment Companies which owned in the
aggregate $_____________ in securities (other than the excluded securities
referred to below) as of the end of the Buyer's most recent fiscal year
(such amount being calculated in accordance with Rule 144A).
3. The term "Family of Investment Companies" as used herein means two or
more registered investment companies (or series thereof) that have the same
investment adviser or investment advisers that are affiliated (by virtue of
being majority owned subsidiaries of the same parent or because one
investment adviser is a majority owned subsidiary of the other).
4. The term "securities" as used herein does not include (i) securities of
issuers that are affiliated with the Buyer or are part of the Buyer's
Family of Investment Companies, (ii) bank deposit notes and certificates of
deposit, (iii) loan participations, (iv) repurchase agreements, (v)
securities owned but subject to a repurchase agreement and (vi) currency,
interest rate and commodity swaps.
5. The Buyer is familiar with Rule 144A and understands that each of the
parties to which this certification is made are relying and will continue
to rely on the statements made herein because one or more sales to the
Buyer will be in reliance on Rule 144A. In addition, the Buyer will only
purchase for the Buyer's own account.
6. The undersigned will notify each of the parties to which this
certification is made of any changes in the information and conclusions
herein. Until such notice, the Buyer's purchase of Rule 144A Securities
will constitute a reaffirmation of this certification by the undersigned as
of the date of such purchase.
____________________________________
Print Name of Buyer
By: ________________________________
Name:
Title:
Date:
IF AN ADVISER
_____________________________________
Print Name of Buyer
By: _________________________________
Name:
Title:
Date:
EXHIBIT C
FORM OF INVESTOR REPRESENTATION LETTER
---------, ----
Bear Xxxxxxx Asset Backed Securities, Inc.
000 Xxxx Xxxxxx, 0xx Xxxxx
Xxx Xxxx, XX 00000
Xxxxx Fargo Bank Minnesota, National Association
Xxxxx Fargo Center
Sixth and Marquette
Xxxxxxxxxxx, Xxxxxxxxx 00000
Attention: Corporate Trust Administration
Re: Home Equity Loan-Backed Capped Funding Notes],
SERIES 2001-2
Ladies and Gentlemen:
________________ (the "Purchaser") intends to purchase $_________ Home
Equity Loan-Backed Capped Funding Notes, Series 2001-2 (the "Capped Funding
Notes"), issued pursuant to the indenture dated as of August 31, 2001 (the
"Indenture"), between Xxxxx Home Equity Loan Trust 2001-2, as issuer (the
"Issuer"), and Xxxxx Fargo Bank Minnesota, National Association, as
indenture trustee (the "Indenture Trustee"). Capitalized terms used herein
that are not otherwise defined shall have the meanings ascribed thereto in
Appendix A to the Indenture. The Purchaser hereby certifies, represents and
warrants to, and covenants with, the Issuer and the Indenture Trustee that:
(a) The Purchaser understands that (a) the Capped Funding Notes have not been
and will not be registered or qualified under the Securities Act of 1933, as
amended (the "Act") or any state securities law, (b) the Issuer is not required
to so register or qualify the Capped Funding Notes, (c) the Capped Funding Notes
may be resold only if registered and qualified pursuant to the provisions of the
Act or any state securities law, or if an exemption from such registration and
qualification is available, (d) the Indenture contains restrictions regarding
the transfer of the Capped Funding Notes and (e) the Capped Funding Notes will
bear a legend to the foregoing effect.
(b) The Purchaser is acquiring the Capped Funding Notes for its own account for
investment only and not with a view to or for sale in connection with any
distribution thereof in any manner that would violate the Act or any applicable
state securities laws.
(c) The Purchaser is (i) a substantial, sophisticated institutional investor
having such knowledge and experience in financial and business matters, and, in
particular, in such matters related to securities similar to the Capped Funding
Notes, such that it is capable of evaluating the merits and risks of investment
in the Capped Funding Notes, (ii) able to bear the economic risks of such an
investment and (iii) an "accredited investor" within the meaning of Rule 501(a)
promulgated pursuant to the Act.
(d) The Purchaser has been furnished with, and has had an opportunity to review
(i) a copy of the Indenture and (ii) such other information concerning the
Capped Funding Notes, the Mortgage Loans and the Issuer as has been requested by
the Purchaser from the Issuer or the Seller and is relevant to the Purchaser's
decision to purchase the Capped Funding Notes. The Purchaser has had any
questions arising from such review answered by the Issuer or the Seller to the
satisfaction of the Purchaser.
(e) The Purchaser has not and will not nor has it authorized or will it
authorize any person to (i) offer, pledge, sell, dispose of or otherwise
transfer any Note, any interest in any Note or any other similar security to any
person in any manner, (ii) solicit any offer to buy or to accept a pledge,
disposition of other transfer of any Note, any interest in any Note or any other
similar security from any person in any manner, (iii) otherwise approach or
negotiate with respect to any Note, any interest in any Note or any other
similar security with any person in any manner, (iv) make any general
solicitation by means of general advertising or in any other manner or (v) take
any other action, that (as to any of (i) through (v) above) would constitute a
distribution of any Capped Funding Note under the Act, that would render the
disposition of any Capped Funding Note a violation of Section 5 of the Act or
any state securities law, or that would require registration or qualification
pursuant thereto. The Purchaser will not sell or otherwise transfer any of the
Capped Funding Notes, except in compliance with the provisions of the Indenture.
(f) The Purchaser is not a non-United States person.
Very truly yours,
By: _________________________________
Name:
Title:
EXHIBIT D
FORM OF TRANSFEROR REPRESENTATION LETTER
---------, ----
Bear Xxxxxxx Asset Backed Securities, Inc.
000 Xxxx Xxxxxx, 0xx Xxxxx
Xxx Xxxx, XX 00000
Xxxxx Fargo Bank Minnesota, National Association
Xxxxx Fargo Center
Sixth and Marquette
Xxxxxxxxxxx, Xxxxxxxxx 00000
Attention: Corporate Trust Administration
Re: Home Equity Loan-Backed Capped Funding Notes,
SERIES 2001-2
Ladies and Gentlemen:
___________ (the "Purchaser") intends to purchase $________ Home Equity
Loan-Backed Capped Funding Notes, Series 2001-2 (the "Notes"), issued
pursuant to an indenture dated as of August 31, 2001 (the "Indenture"),
between Xxxxx Home Equity Loan Trust 2001-2, as issuer (the "Issuer"), and
Xxxxx Fargo Bank Minnesota, National Association, as indenture trustee (the
"Indenture Trustee"). Capitalized terms used herein that are not otherwise
defined shall have the meanings ascribed thereto in Appendix A to the
Indenture. The Seller hereby certifies, represents and warrants to, and
covenants with, the Issuer and the Indenture Trustee that:
Neither the Seller nor anyone acting on its behalf has (i) offered,
pledged, sold, disposed of or otherwise transferred any Capped Funding
Note, any interest in any Capped Funding Note or any other similar security
to any person in any manner, (ii) has solicited any offer to buy or to
accept a pledge, disposition or other transfer of any Capped Funding Note,
any interest in any Capped Funding Note or any other similar security from
any person in any manner, (iii) has otherwise approached or negotiated with
respect to any Capped Funding Note, any interest in any Capped Funding Note
or any other similar security with any person in any manner, (iv) has made
any general solicitation by means of general advertising or in any other
manner, or (v) has taken any other action, that (as to any of (i) through
(v) above) would constitute a distribution Capped Funding Notes under the
Securities Act of 1933, as amended (the "Act"), that would render the
disposition of any Capped Funding Note a violation of Section 5 of the Act
or any state securities law, or that would require registration or
qualification pursuant thereto. The Seller will not act in any manner set
forth in the foregoing sentence with respect to any Capped Funding Note.
The Seller has not and will not sell or otherwise transfer any of the
Notes, except in compliance with the provisions of the Indenture.
Very truly yours,
By: __________________________________
Name:
Title:
