Exhibit 4.1
ORIGEN MANUFACTURED HOUSING CONTRACT TRUST 2006-A
Issuing Entity
and
JPMORGAN CHASE BANK, NATIONAL ASSOCIATION
Indenture Trustee
----------
INDENTURE
Dated as of August 1, 2006
----------
ORIGEN MANUFACTURED HOUSING CONTRACT TRUST COLLATERALIZED NOTES,
SERIES 2006-A
----------
TABLE OF CONTENTS
Section Page
- ------- ----
ARTICLE I
DEFINITIONS
Section 1.01 Definitions................................................ 2
Section 1.02 Incorporation by Reference of Trust Indenture Act.......... 2
Section 1.03 Rules of Construction...................................... 2
ARTICLE II
ORIGINAL ISSUANCE OF THE NOTES
Section 2.01 Form....................................................... 3
Section 2.02 Execution, Authentication and Delivery..................... 3
Section 2.03 Acceptance of Contracts by Indenture Trustee............... 4
ARTICLE III
COVENANTS
Section 3.01 Collection of Payments with respect to the Contracts....... 5
Section 3.02 Maintenance of Office or Agency............................ 5
Section 3.03 Money for Payments To Be Held in Trust; Paying Agent....... 5
Section 3.04 Existence.................................................. 7
Section 3.05 Payment of Principal and Interest.......................... 7
Section 3.06 Protection of Trust Estate................................. 7
Section 3.07 Opinions as to Trust Estate................................ 8
Section 3.08 Performance of Obligations................................. 8
Section 3.09 Negative Covenants......................................... 9
Section 3.10 [Reserved]................................................. 9
Section 3.11 [Reserved]................................................. 9
Section 3.12 Representations and Warranties Concerning the Contracts.... 9
Section 3.13 Amendments to Servicing Agreement.......................... 10
Section 3.14 Servicer as Agent and Bailee of the Indenture Trustee...... 10
Section 3.15 Investment Company Act..................................... 10
Section 3.16 Issuing Entity May Consolidate, etc........................ 10
Section 3.17 Successor or Transferee.................................... 12
Section 3.18 No Other Business.......................................... 13
Section 3.19 No Borrowing............................................... 13
Section 3.20 Guarantees, Loans, Advances and Other Liabilities.......... 13
Section 3.21 Capital Expenditures....................................... 13
Section 3.22 Reserved................................................... 13
Section 3.23 Restricted Payments........................................ 13
Section 3.24 Notice of Events of Default................................ 13
Section 3.25 Further Instruments and Acts............................... 14
Section 3.26 Statements to Noteholders.................................. 14
Section 3.27 [Reserved]................................................. 14
Section 3.28 Certain Representations Regarding the Trust Estate......... 14
ARTICLE IV
THE NOTES; SATISFACTION AND DISCHARGE OF INDENTURE
Section 4.01 The Notes.................................................. 15
Section 4.02 Registration of and Limitations on Transfer and Exchange of
Notes; Appointment of Note Registrar and Certificate
Registrar.................................................. 16
Section 4.03 Mutilated, Destroyed, Lost or Stolen Notes................. 17
Section 4.04 Persons Deemed Owners...................................... 17
Section 4.05 Cancellation............................................... 18
Section 4.06 Book-Entry Notes........................................... 18
Section 4.07 Notices to Depository...................................... 19
Section 4.08 Definitive Notes........................................... 19
Section 4.09 Tax Treatment.............................................. 19
Section 4.10 Satisfaction and Discharge of Indenture.................... 19
Section 4.11 Application of Trust Money................................. 20
Section 4.12 [Reserved]................................................. 21
Section 4.13 Repayment of Monies Held by Paying Agent................... 21
Section 4.14 Temporary Notes............................................ 21
Section 4.15 Representation Regarding ERISA............................. 21
ARTICLE V
DEFAULT AND REMEDIES
Section 5.01 Events of Default.......................................... 22
Section 5.02 Acceleration of Maturity; Rescission and Annulment......... 22
Section 5.03 Collection of Indebtedness and Suits for Enforcement by
Indenture Trustee.......................................... 23
Section 5.04 Remedies; Priorities....................................... 25
Section 5.05 Optional Preservation of the Trust Estate.................. 26
Section 5.06 Limitation of Suits........................................ 26
Section 5.07 Unconditional Rights of Noteholders To Receive Principal
and Interest............................................... 27
Section 5.08 Restoration of Rights and Remedies......................... 27
Section 5.09 Rights and Remedies Cumulative............................. 27
Section 5.10 Delay or Omission Not a Waiver............................. 27
Section 5.11 Control By Noteholders..................................... 28
Section 5.12 Waiver of Past Defaults.................................... 28
Section 5.13 Undertaking for Costs...................................... 28
Section 5.14 Waiver of Stay or Extension Laws........................... 29
Section 5.15 Sale of Trust Estate....................................... 29
Section 5.16 Action on Notes............................................ 31
ii
Section 5.17 Performance and Enforcement of Certain Obligations......... 31
ARTICLE VI
THE INDENTURE TRUSTEE
Section 6.01 Duties of Indenture Trustee................................ 31
Section 6.02 Rights of Indenture Trustee................................ 33
Section 6.03 Individual Rights of Indenture Trustee..................... 33
Section 6.04 Indenture Trustee's Disclaimer............................. 33
Section 6.05 Notice of Event of Default................................. 34
Section 6.06 Reports by Indenture Trustee to Holders and Tax
Administration............................................. 34
Section 6.07 Compensation and Indemnity................................. 34
Section 6.08 Replacement of Indenture Trustee........................... 35
Section 6.09 Successor Indenture Trustee by Merger...................... 35
Section 6.10 Appointment of Co-Indenture Trustee or Separate Indenture
Trustee.................................................... 36
Section 6.11 Eligibility; Disqualification.............................. 37
Section 6.12 Preferential Collection of Claims Against Issuing Entity... 37
Section 6.13 Representations and Warranties............................. 37
Section 6.14 Directions to Indenture Trustee............................ 38
Section 6.15 The Agents................................................. 38
ARTICLE VII
NOTEHOLDERS' LISTS AND REPORTS
Section 7.01 Issuing Entity To Furnish Indenture Trustee Names and
Addresses of Noteholders................................... 38
Section 7.02 Preservation of Information; Communications to
Noteholders................................................ 38
Section 7.03 Reserved................................................... 39
Section 7.04 Reports by Indenture Trustee............................... 39
Section 7.05 Statements to Noteholders.................................. 39
ARTICLE VIII
ACCOUNTS, DISBURSEMENTS AND RELEASES
Section 8.01 Collection of Money........................................ 41
Section 8.02 Payments on the Notes...................................... 41
Section 8.03 Officer's Certificate...................................... 43
Section 8.04 Termination Upon Distribution to Noteholders............... 43
Section 8.05 Release of Trust Estate.................................... 44
Section 8.06 Surrender of Notes Upon Final Payment...................... 44
Section 8.07 Optional Redemption of the Notes; Auction.................. 44
Section 8.08 [Reserved]................................................. 45
Section 8.09 Interest Rate Swap Agreement............................... 45
Section 8.10 Rights of the Swap Provider................................ 45
iii
Section 8.11 Policy Payments............................................ 46
Section 8.12 Rights of the Note Insurer................................. 48
ARTICLE IX
SUPPLEMENTAL INDENTURES
Section 9.01 Supplemental Indentures Without Consent of Noteholders..... 48
Section 9.02 Supplemental Indentures With Consent of Noteholders and
Note Insurer............................................... 50
Section 9.03 Execution of Supplemental Indentures....................... 51
Section 9.04 Effect of Supplemental Indenture........................... 51
Section 9.05 Conformity with Trust Indenture Act........................ 51
Section 9.06 Reference in Notes to Supplemental Indentures.............. 52
ARTICLE X
MISCELLANEOUS
Section 10.01 Compliance Certificates and Opinions, etc.................. 52
Section 10.02 Form of Documents Delivered to Indenture Trustee........... 54
Section 10.03 Acts of Noteholders........................................ 54
Section 10.04 Notices etc., to Indenture Trustee Issuing Entity and
Rating Agencies............................................ 55
Section 10.05 Notices to Noteholders; Waiver............................. 55
Section 10.06 Conflict with Trust Indenture Act.......................... 56
Section 10.07 Effect of Headings......................................... 56
Section 10.08 Successors and Assigns..................................... 56
Section 10.09 Separability............................................... 56
Section 10.10 Third Party Beneficiary.................................... 56
Section 10.11 Legal Holidays............................................. 57
Section 10.12 GOVERNING LAW.............................................. 57
Section 10.13 Counterparts............................................... 57
Section 10.14 Recording of Indenture..................................... 57
Section 10.15 Issuing Entity Obligation.................................. 57
Section 10.16 No Petition................................................ 57
Section 10.17 Inspection................................................. 58
Section 10.18 No Recourse to Owner Trustee............................... 58
Section 10.19 Proofs of Claim............................................ 58
EXHIBITS
Exhibit A-1 Form of Class A-1 Note
Exhibit A-2 Form of Class A-2 Note
Exhibit B List of Contracts
Exhibit C Form of Custodial Agreement
Exhibit D Copy of Financial Guaranty Insurance Policy
Appendix A Definitions
Appendix B Auction Rate Procedures
iv
This Indenture, dated as of August 1, 2006, is entered into between Origen
Manufactured Housing Contract Trust 2006-A, a Delaware statutory trust, as
Issuing Entity (the "Issuing Entity"), and JPMorgan Chase Bank, National
Association, a national banking association, as Indenture Trustee (the
"Indenture Trustee").
WITNESSETH THAT:
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 Issuing Entity's Notes,
Series 2006-A (the "Notes").
GRANTING CLAUSE
The Issuing Entity hereby Grants to the Indenture Trustee at the Closing
Date, as trustee for the benefit of the Holders of the Notes and the Note
Insurer, all of the Issuing Entity's right, title and interest in and to whether
now existing or hereafter created by (a) the Contracts (including without
limitation any Eligible Substitute Contracts assigned to the Depositor pursuant
to the Asset Purchase Agreement and assigned to the Issuing Entity pursuant to
the Trust Agreement from time to time) and the proceeds thereof and all rights
under the Related Documents; (b) all funds on deposit from time to time in the
Collection Account allocable to the Contracts excluding any investment income
from such funds; (c) all funds on deposit from time to time in the Note Payment
Account and in all proceeds thereof; (d) all rights under (i) the Asset Purchase
Agreement as assigned to the Issuing Entity, (ii) the Servicing Agreement, and
(iii) all rights under every Hazard Insurance Policy relating to a Manufactured
Home or Mortgaged Property securing a Contract for the benefit of the creditor
of such Contract, and (iv) all documents contained in the Contract Files and the
Land-and-Home Contract Files, subject to the exceptions set forth in the Initial
Certification and the Final Certification delivered by the Custodian, in the
forms of Exhibit A-1 and Exhibit A-2 to the Custodial Agreement, respectively;
(e) all of the Issuing Entity's rights under the Interest Rate Swap Agreement;
and (f) 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 which 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 in this Indenture.
The Indenture Trustee, as trustee on behalf of the Holders of the Notes and
for the benefit of the Note Insurer, 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 not otherwise defined herein shall have the meanings assigned
to such terms in the Definitions attached hereto as Appendix A which is
incorporated by reference herein. All other capitalized terms used herein shall
have the meanings specified herein.
Section 1.02 Incorporation by Reference of Trust Indenture Act. Whenever
this Indenture refers to a provision of the Trust Indenture Act (the "TIA"), the
provision is incorporated by reference in and made a part of this Indenture. The
following TIA terms used in this Indenture have the following meanings:
"Commission" means the Securities and Exchange Commission.
"indenture securities" means the Notes.
"indenture security holder" means a Noteholder.
"indenture to be qualified" means this Indenture.
"indenture trustee" or "institutional trustee" means the Indenture
Trustee.
"obligor" on the indenture securities means the Issuing Entity 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 rules and
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" is not exclusive;
(iv) "including" means including without limitation;
(v) words in the singular include the plural and words in the plural
include the singular; and
(vi) 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
2
includes (in the case of agreements or instruments) references to all
attachments thereto and instruments incorporated therein; references to a
Person are also to its permitted successors and assigns.
ARTICLE II
ORIGINAL ISSUANCE OF THE NOTES
Section 2.01 Form. The Class A Notes together with the Indenture Trustee's
certificate of authentication, shall be in substantially the form set forth in
Exhibits A-1 and A-2 to this Indenture, respectively, with such appropriate
insertions, omissions, substitutions and other variations as are required or
permitted by this Indenture.
The Notes shall be typewritten, printed, lithographed or engraved or
produced by any combination of these methods (with or without steel engraved
borders).
The terms of the Notes set forth in Exhibits A-1, and A-2 to this Indenture
are part of the terms of this Indenture.
Section 2.02 Execution, Authentication and Delivery. The Notes shall be
executed on behalf of the Issuing Entity 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 Issuing Entity shall bind the Issuing
Entity, notwithstanding that such individuals or any of them have ceased to hold
such offices prior to the authentication and delivery of such Notes or did not
hold such offices at the date of such Notes.
The Indenture Trustee shall upon Issuing Entity Request authenticate and
deliver the Class A Notes for original issue in an aggregate initial principal
amount of $200,646,000. The Class A-1 Notes shall be issued in an aggregate
initial Note Balance of $102,596,000, and the Class A-2 Notes shall be issued in
an aggregate initial Note Balance of $98,050,000.
Each of the Notes shall be dated the date of its authentication. The Class
A-1 Notes shall be issuable as registered Notes and the Notes shall be issuable
in the minimum initial Note Balances of $100,000 and in integral multiples of $1
in excess thereof. The Class A-2 Notes shall be issuable as registered Notes and
the Notes shall be issuable in the minimum initial Note Balances of $25,000 and
in integral multiples of $25,000 in excess thereof.
No Note shall be entitled to any benefit under this Indenture or be valid
or obligatory for any purpose, unless there appears on such Note a certificate
of authentication substantially in the form provided for herein executed by the
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.
3
Section 2.03 Acceptance of Contracts by Indenture Trustee.
(a) The Indenture Trustee or the Custodian acknowledges receipt of, subject
to the exceptions it notes pursuant to the procedures described below, the
documents (or certified copies thereof) referred to in Section 2.2 of the Asset
Purchase Agreement, and declares that it holds and will continue to hold those
documents and any amendments, replacements or supplements thereto and all other
assets of the Trust Estate as Indenture Trustee in trust for the use and benefit
of all present and future Holders of the Notes and the Note Insurer or, in the
case of the Custodian, on behalf of the Indenture Trustee.
The Indenture Trustee, or the Custodian on its behalf, shall, for the
benefit of the Noteholders and the Note Insurer, review each Asset File on or
before the Closing Date and certify in substantially the form attached to the
Custodial Agreement as Exhibit A-1 thereto that, as to each Contract listed in
the List of Contracts (other than any Contract specifically identified in the
exception report annexed thereto as not being covered by such certification),
(i) all documents constituting part of such Asset File (other than assumption
and modification agreements) required to be delivered to it pursuant to the
Asset Purchase Agreement are in its possession, (ii) such documents have been
reviewed by it and appear regular on their face and relate to such Contract and
(iii) based on its examination and only as to the foregoing, the information set
forth in the List of Contracts accurately reflects information set forth in the
Asset File. It is herein acknowledged that, in conducting such review, neither
the Indenture Trustee nor the Custodian shall be under any duty or obligation
(i) to inspect, review or examine any such documents, instruments, certificates
or other papers to determine whether they are genuine, enforceable, or
appropriate for the represented purpose or whether they have actually been
recorded or that they are other than what they purport to be on their face or
(ii) to determine whether any Asset File should include any of the documents
concerning assumption and modification agreements.
Prior to the first anniversary date of this Indenture the Indenture Trustee
or the Custodian shall deliver to the Depositor, the Note Insurer and the
Servicer a final certification in the form annexed to the Custodial Agreement as
Exhibit A-2 evidencing the completeness of the Asset Files, with any applicable
exceptions noted thereon, and the Servicer shall forward a copy thereof to any
Sub-Servicer.
If in the process of reviewing the Asset Files and making or preparing, as
the case may be, the certifications referred to above, the Indenture Trustee or
the Custodian finds any document or documents constituting a part of an Asset
File to be missing or defective in any material respect, at the conclusion of
its review the Indenture Trustee or the Custodian shall so notify the Depositor,
the Note Insurer and the Servicer. In addition, upon the discovery by the
Indenture Trustee of a breach of any of the representations and warranties made
by the Originator and the Seller in the Asset Purchase Agreement in respect of
any Contract which materially adversely affects such Contract or the interests
of the related Noteholders and the Note Insurer in such Contract, the Indenture
Trustee party discovering such breach shall give prompt written notice to the
Depositor, the Servicer, the Note Insurer, the Originator and the Seller.
(b) Upon receipt by the Trust Estate by deposit in the Note Payment Account
of the Repurchase Price for a repurchased Contract under Section 2.03 of the
Servicing Agreement, or
4
the delivery of an Eligible Substitute Contract pursuant to subsection 3.6(b) of
the Asset Purchase Agreement, and upon receipt of a certificate of an Officer of
the Originator in the form attached as Exhibit B to the Servicing Agreement or,
with respect to any Eligible Substitute Contract delivered under subsection
3.6(b) of the Asset Purchase Agreement, a certificate of an Officer of the
Originator in the form attached as Exhibit A to the Asset Purchase Agreement,
the Indenture Trustee shall release or shall cause the Custodian to release the
related Asset File and shall execute and deliver all instruments of transfer or
assignment, without recourse, furnished to it by the Originator as are necessary
to vest in the Originator title to and rights under the related Contract.
ARTICLE III
COVENANTS
Section 3.01 Collection of Payments with respect to the Contracts. The
Indenture Trustee shall establish and maintain an Eligible Account (the "Note
Payment Account") in which the Indenture Trustee shall deposit, on the same day
as received from the Servicer, amounts received from the Servicer pursuant to
Section 3.06(a) of the Servicing Agreement. The Indenture Trustee shall make all
payments of principal of and interest on the Notes, subject to Section 3.03 as
provided in Section 3.05 herein from monies on deposit in the Note Payment
Account.
Section 3.02 Maintenance of Office or Agency. The Issuing Entity will
maintain an office or agency where, subject to 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 Issuing Entity in respect of the
Notes and this Indenture may be served. The Issuing Entity hereby initially
appoints the Indenture Trustee to serve as its agent for the foregoing purposes.
If at any time the Issuing Entity shall fail to maintain any such office or
agency or shall fail to furnish the Indenture Trustee with the address thereof,
such surrenders may be made and notices and demands may be made or served at the
Corporate Trust Office.
Section 3.03 Money for Payments To Be Held in Trust; Paying Agent. As
provided in Section 3.01, all payments of amounts due and payable with respect
to any Notes that are to be made from amounts withdrawn from the Note Payment
Account pursuant to Section 3.01 shall be made on behalf of the Issuing Entity
by the Indenture Trustee or by the Paying Agent, and no amounts so withdrawn
from the Note Payment Account for payments of Notes shall be paid over to the
Issuing Entity except as provided in this Section 3.03. The Issuing Entity
hereby appoints the Indenture Trustee as its Paying Agent.
The Issuing Entity will 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 if the Indenture
Trustee acts as Paying Agent it hereby so agrees), subject to the provisions of
this Section 3.03, that such Paying Agent will:
(i) hold all sums held by it for the payment of amounts due with
respect to the Notes in trust for the benefit of the Persons entitled
thereto until such sums shall be paid
5
to such Persons or otherwise disposed of as herein provided and pay such
sums to such Persons as herein provided;
(ii) give the Indenture Trustee and the Note Insurer notice of any
default by the Issuing Entity of which it has actual knowledge in the
making of any payment required to be made with respect to the Notes;
(iii) at any time during the continuance of any such default, upon the
written request of the Indenture Trustee, forthwith pay to the Indenture
Trustee all sums so held in trust by such Paying Agent;
(iv) immediately resign as Paying Agent and forthwith pay to the
Indenture Trustee all sums held by it in trust for the payment of Notes if
at any time it ceases to meet the standards required to be met by a Paying
Agent at the time of its appointment;
(v) comply with all requirements of the Code with respect to the
withholding from any payments made by it on any Notes of any applicable
withholding taxes imposed thereon and with respect to any applicable
reporting requirements in connection therewith; and
(vi) not commence a bankruptcy proceeding against the Issuing Entity
in connection with this Indenture.
The Issuing Entity may at any time, for the purpose of obtaining the
satisfaction and discharge of this Indenture or for any other purpose, by
Issuing Entity 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 the 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.
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 Issuing Entity on Issuing Entity Request; and
the Holder of such Note shall thereafter, as an unsecured general creditor, look
only to the Issuing Entity for payment thereof (but only to the extent of the
amounts so paid to the Issuing Entity), 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 Issuing Entity cause to be published once, in an Authorized
Newspaper published in the English language, 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 Issuing Entity. The Indenture Trustee may
also adopt and employ, at the expense and direction f the Issuing Entity, any
other reasonable means of notification of such repayment (including, but not
limited to, mailing notice of such repayment to Holders whose Notes have been
called but have not been surrendered for redemption or whose right to or
interest in monies
6
due and payable but not claimed is determinable from the records of the
Indenture Trustee or of any Paying Agent, at the last address of record for each
such Holder).
Section 3.04 Existence. The Issuing Entity will keep in full effect its
existence, rights and franchises as a statutory trust under the laws of the
State of Delaware (unless it becomes, or any successor Issuing Entity hereunder
is or becomes, organized under the laws of any other state or of the United
States of America, in which case the Issuing Entity will keep in full effect its
existence, rights and franchises under the laws of such other jurisdiction) and
will obtain and preserve its qualification to do business in each jurisdiction
in which such qualification is or shall be necessary to protect the validity and
enforceability of this Indenture, the Notes, the Contracts and each other
instrument or agreement included in the Trust Estate.
Section 3.05 Payment of Principal and Interest. On each Payment Date from
amounts on deposit in the Note Payment Account in accordance with Section 8.02
hereof, the Indenture Trustee shall pay to the Persons and to the extent
provided therein, the Amount Available for such Payment Date.
Section 3.06 Protection of Trust Estate.
(a) The Issuing Entity will from time to time prepare, execute and deliver
all such supplements and amendments hereto and all such financing statements,
continuation statements, instruments of further assurance and other instruments,
and will take such other action necessary or advisable to:
(i) maintain or preserve the lien and security interest (and the
priority thereof) of this Indenture or carry out more effectively the
purposes hereof;
(ii) perfect, publish notice of or protect the validity of any Grant
made or to be made by this Indenture;
(iii) cause the Issuing Entity or Servicer to enforce any of the
rights to the Contracts; or
(iv) preserve and defend title to the Trust Estate and the rights of
the Indenture Trustee, the Noteholders and the Note Insurer in such Trust
Estate 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 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 hereof (or from the jurisdiction in which it was held
as described in the Opinion of Counsel delivered on the Closing Date pursuant to
Section 3.07(a) hereof, or if no Opinion of Counsel has yet been delivered
pursuant to Section 3.07(b) hereof, 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).
7
The Issuing Entity hereby designates the Indenture Trustee its agent and
attorney-in-fact to sign any financing statement, continuation statement or
other instrument required to be signed pursuant to this Section 3.06 upon the
Issuing Entity's preparation thereof and delivery to the Indenture Trustee.
Section 3.07 Opinions as to Trust Estate.
(a) On the Closing Date, the Issuing Entity shall furnish to the Indenture
Trustee, the Note Insurer and the Owner Trustee an Opinion of Counsel either
stating that, in the opinion of such counsel, such action has been taken with
respect to the recording and filing of this Indenture, any indentures
supplemental hereto, and any other requisite documents, and with respect to the
execution and filing of any financing statements and continuation statements, as
are necessary to perfect and make effective the lien and first priority security
interest in the Collateral and reciting the details of such action, or stating
that, in the opinion of such counsel, no such action is necessary to make such
lien and first priority security interest effective.
(b) On or before April 15th in each calendar year, beginning in 2007, the
Issuing Entity shall furnish to the Indenture Trustee and the Note Insurer an
Opinion of Counsel at the expense of the Issuing Entity either stating that, in
the opinion of such counsel, such action has been taken with respect to the
recording, filing, rerecording and refiling of this Indenture, any indentures
supplemental hereto and any other requisite documents and with respect to the
execution and filing of any financing statements and continuation statements as
is necessary to maintain the lien and first priority security interest in the
Collateral and reciting the details of such action or stating that in the
opinion of such counsel no such action is necessary to maintain such lien and
security interest. Such Opinion of Counsel shall also describe the recording,
filing, re-recording and refiling of this Indenture, any indentures supplemental
hereto and any other requisite documents and the execution and filing of any
financing statements and continuation statements that will, in the opinion of
such counsel, be required to maintain the lien and security interest in the
Collateral until December 31st in the following calendar year.
Section 3.08 Performance of Obligations.
(a) The Issuing Entity will punctually perform and observe all of its
obligations and agreements contained in this Indenture, the Basic Documents and
in the instruments and agreements included in the Trust Estate.
(b) The Issuing Entity 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 Issuing Entity shall be deemed to be action taken by the Issuing Entity.
(c) The Issuing Entity will not take any action or permit any action to be
taken by others which would release any Person from any of such Person's
covenants or obligations under any of the documents relating to the Contracts or
under any instrument included in the Trust Estate, or which would result in the
amendment, hypothecation, subordination, termination or discharge of, or impair
the validity or effectiveness of, any of the documents relating to the Contracts
or any such instrument, except such actions as the Servicer is expressly
permitted to
8
take in the Servicing Agreement. The Indenture Trustee may exercise
the rights of the Issuing Entity to direct the actions of the Servicer pursuant
to the Servicing Agreement.
(d) The Issuing Entity may retain an administrator and may enter into
contracts with other Persons for the performance of the Issuing Entity's
obligations hereunder, and performance of such obligations by such Persons shall
be deemed to be performance of such obligations by the Issuing Entity.
Section 3.09 Negative Covenants. So long as any Notes are Outstanding, the
Issuing Entity shall not:
(i) 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;
(ii) claim any credit on, or make any deduction from the principal or
interest payable in respect of, the Notes (other than amounts properly
withheld from such payments under the Code) or assert any claim against any
present or former Noteholder by reason of the payment of the taxes levied
or assessed upon any part of the Trust Estate;
(iii) (A) permit the validity or effectiveness of this Indenture to be
impaired, or permit the lien of this Indenture to be amended, hypothecated,
subordinated, terminated or discharged, or permit any Person to be released
from any covenants or obligations with respect to the Notes under this
Indenture except as may be expressly permitted hereby, (B) permit any lien,
charge, excise, claim, security interest, mortgage or other encumbrance
(other than the lien of this Indenture) to be created on or extend to or
otherwise arise upon or burden the Trust Estate or any part thereof or any
interest therein or the proceeds thereof or (C) permit the lien of this
Indenture not to constitute a valid first priority security interest in the
Trust Estate; or
(iv) waive or impair, or fail to assert rights under, the Contracts,
or impair or cause to be impaired the Issuing Entity's interest in the
Contracts, the Asset Purchase Agreement or in any Basic Document, if any
such action would materially and adversely affect the interests of the
Noteholders.
Section 3.10 [Reserved].
Section 3.11 [Reserved].
Section 3.12 Representations and Warranties Concerning the Contracts. The
Indenture Trustee and the Note Insurer, as pledgee of the Contracts, have the
benefit of the representations and warranties made by the Originator and the
Seller in the Asset Purchase Agreement concerning the Originator, the Seller and
the Contracts to the same extent as though such representations and warranties
were made directly to the Indenture Trustee and the Note Insurer. If a
Responsible Officer of the Indenture Trustee has actual knowledge of any breach
of any representation or warranty made by the Originator and the Seller in the
Asset Purchase Agreement, the Indenture Trustee shall promptly notify the
Originator of such finding and the Originator's obligation to cure such defect
or repurchase or substitute for the related Contract.
9
Section 3.13 Amendments to Servicing Agreement. The Issuing Entity
covenants with the Indenture Trustee that it will not enter into any amendment
or supplement to the Servicing Agreement without the prior written consent of
the Indenture Trustee and the Note Insurer.
Section 3.14 Servicer as Agent and Bailee of the Indenture Trustee. Solely
for purposes of perfection under Section 9-305 of the UCC or other similar
applicable law, rule or regulation of the state in which such property is held
by the Servicer, the Issuing Entity and the Indenture Trustee hereby acknowledge
that the Servicer is acting as bailee of the Indenture Trustee in holding
amounts on deposit in the Collection Account, as well as its bailee in holding
any Related Documents released to the Servicer, and any other items constituting
a part of the Trust Estate which from time to time come into the possession of
the Servicer. It is intended that, by the Servicer's acceptance of such bailee
arrangement, the Indenture Trustee, as a secured party of the Contracts, will be
deemed to have possession of such Related Documents, such monies and such other
items for purposes of Section 9-305 of the UCC of the state in which such
property is held by the Servicer. The Indenture Trustee shall not be liable and
has no duty with respect to such documents, monies or items while in possession
of the Servicer.
Section 3.15 Investment Company Act. The Issuing Entity shall not become an
"investment company" or be under the "control" of an "investment company" as
such terms are defined in the Investment Company Act of 1940, as amended (or any
successor or amendatory statute), 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, however, that the Issuing Entity shall be in compliance with this
Section 3.15 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 Issuing Entity May Consolidate, etc.
(a) The Issuing Entity shall not consolidate or merge with or into any
other Person, unless:
(i) the Person (if other than the Issuing Entity) 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 or the
District of Columbia and shall expressly assume, by an indenture
supplemental hereto, executed and delivered to the Indenture Trustee, in
form reasonably satisfactory to the Indenture Trustee and the Note Insurer,
the due and punctual payment of the principal of and interest on all Notes,
and all other amounts payable to the Indenture Trustee, the payment to the
Certificate Paying Agent of all amounts due to the Certificateholders, and
the performance or observance of every agreement and covenant of this
Indenture on the part of the Issuing Entity 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;
10
(iii) the Rating Agencies shall have notified the Issuing Entity that
such transaction shall not cause the rating of the Notes to be reduced,
suspended or withdrawn or to be considered by either Rating Agency to be
below investment grade;
(iv) the Issuing Entity shall have received an Opinion of Counsel (and
shall have delivered a copy thereof to the Indenture Trustee and the Note
Insurer) to the effect that such transaction will not (A) result in a
"substantial modification" of the Notes under Treasury Regulation section
1.1001-3, or adversely affect the status of the Notes as indebtedness for
federal income tax purposes, or (B) if 100% of the Certificates are not
owned by Origen REIT or a direct or indirect qualified REIT subsidiary of
Origen REIT, cause the Trust to be subject to an entity level tax for
federal income tax purposes;
(v) any action that is necessary to maintain the lien and security
interest created by this Indenture shall have been taken;
(vi) the Issuing Entity 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 III and that all conditions precedent herein provided for or
relating to such transaction have been complied with (including any filing
required by the Exchange Act), and that such supplemental indenture is
enforceable; and
(vii) so long as no Note Insurer Default has occurred and is
continuing, the Issuing Entity will have given the Note Insurer written
notice of such consolidation or merger at least 20 Business Days prior to
the consummation of such action and will have received the prior written
approval of the Note Insurer of such consolidation or merger and the
Issuing Entity or the Person (if other than the Issuing Entity) formed by
or surviving such consolidation or merger has a net worth, immediately
after such consolidation or merger, that is (a) greater than zero and (b)
not less than the net worth of the Issuing Entity immediately prior to
giving effect to such consolidation or merger.
(b) The Issuing Entity 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 Issuing Entity, 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 thereof, (B) expressly assume, by an indenture supplemental
hereto, executed and delivered to the Indenture Trustee, in form
satisfactory to the Indenture Trustee and the Note Insurer, 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 Issuing Entity 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 Holders of the Notes,
(D) unless otherwise provided in such supplemental indenture, expressly
agree to indemnify, defend and hold harmless the Issuing Entity, the Owner
Trustee and the Indenture Trustee against and
11
from any loss, liability or expense arising under or related to this
Indenture and the Notes and (E) expressly agree by means of such
supplemental indenture that such Person (or if a group of Persons, then one
specified Person) shall make all filings with the Commission (and any other
appropriate Person) required by the Exchange Act in connection with the
Notes;
(ii) immediately after giving effect to such transaction, no Default
or Event of Default shall have occurred and be continuing;
(iii) the Rating Agencies shall have notified the Issuing Entity that
such transaction shall not cause the rating of the Notes to be reduced,
suspended or withdrawn;
(iv) the Issuing Entity shall have received an Opinion of Counsel (and
shall have delivered a copy thereof to the Indenture Trustee and the Note
Insurer) to the effect that such transaction will not (A) result in a
"substantial modification" of the Notes under Treasury Regulation section
1.1001-3, or adversely affect the status of the Notes as indebtedness for
federal income tax purposes, or (B) if 100% of the Certificates are not
owned by Origen REIT or a direct or indirect qualified REIT subsidiary of
Origen REIT, cause the Trust to be subject to an entity level tax for
federal income tax purposes;
(v) any action that is necessary to maintain the lien and security
interest created by this Indenture shall have been taken;
(vi) the Issuing Entity 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 III and that all conditions precedent herein provided for relating
to such transaction have been complied with (including any filing required
by the Exchange Act); and
(vii) so long as no Note Insurer Default has occurred and is
continuing, the Issuing Entity will have given the Note Insurer written
notice of such conveyance or transfer at least 20 Business Days prior to
the consummation of such action and will have received the prior written
approval of the Note Insurer of such conveyance or transfer and the
transferee has a net worth, immediately after such conveyance or transfer,
that is (a) greater than zero and (b) not less than the net worth of the
Issuing Entity immediately prior to giving effect to such consolidation or
merger.
Section 3.17 Successor or Transferee.
(a) Upon any consolidation or merger of the Issuing Entity in accordance
with Section 3.16(a), the Person formed by or surviving such consolidation or
merger (if other than the Issuing Entity) shall succeed to, and be substituted
for, and may exercise every right and power of, the Issuing Entity under this
Indenture with the same effect as if such Person had been named as the Issuing
Entity herein.
(b) Upon a conveyance or transfer of all the assets and properties of the
Issuing Entity pursuant to Section 3.16(b), the Issuing Entity will be released
from every covenant and agreement of this Indenture to be observed or performed
on the part of the Issuing Entity with
12
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 Issuing Entity shall not engage in any
business other than financing, purchasing, owning and selling and managing the
Contracts and the issuance of the Notes and Certificates in the manner
contemplated by this Indenture and the Basic Documents and all activities
incidental thereto.
Section 3.19 No Borrowing. The Issuing Entity shall not issue, incur,
assume, guarantee or otherwise become liable, directly or indirectly, for any
indebtedness except for the Notes under this Indenture.
Section 3.20 Guarantees, Loans, Advances and Other Liabilities. Except as
contemplated by this Indenture or the Basic Documents, the Issuing Entity shall
not make any loan or advance or credit to, or guarantee (directly or indirectly
or by an instrument having the effect of assuring another's payment or
performance on any obligation or capability of so doing or otherwise), endorse
or otherwise become contingently liable, directly or indirectly, in connection
with the obligations, stocks or dividends of, or own, purchase, repurchase or
acquire (or agree contingently to do so) any stock, obligations, assets or
securities of, or any other interest in, or make any capital contribution to,
any other Person.
Section 3.21 Capital Expenditures. The Issuing Entity shall not make any
expenditure (by long-term or operating lease or otherwise) for capital assets
(either realty or personalty).
Section 3.22 Reserved.
Section 3.23 Restricted Payments. The Issuing Entity shall not, directly or
indirectly, (i) pay any dividend or make any distribution (by reduction of
capital or otherwise), whether in cash, property, securities or a combination
thereof, to the Owner Trustee or any owner of a beneficial interest in the
Issuing Entity or otherwise with respect to any ownership or equity interest or
security in or of the Issuing Entity, (ii) redeem, purchase, retire or otherwise
acquire for value any such ownership or equity interest or security or (iii) set
aside or otherwise segregate any amounts for any such purpose; provided,
however, that the Issuing Entity may make, or cause to be made, (x)
distributions and payments to the Owner Trustee, the Indenture Trustee, the Note
Insurer, the Auction Agent, the Broker-Dealer, the Noteholders and the
Certificateholders as contemplated by, and to the extent funds are available for
such purpose under this Indenture and the Trust Agreement and (y) payments to
the Servicer pursuant to the terms of the Servicing Agreement and payments to
the Swap Provider pursuant to the terms of the Interest Rate Swap Agreement. The
Issuing Entity will not, directly or indirectly, make payments to or
distributions from the Collection Account except in accordance with this
Indenture and the Basic Documents.
Section 3.24 Notice of Events of Default. The Issuing Entity shall give the
Indenture Trustee, the Note Insurer and the Rating Agencies prompt written
notice of each Event of Default hereunder and under the Trust Agreement.
13
Section 3.25 Further Instruments and Acts. Upon request of the Indenture
Trustee, the Issuing Entity will execute and deliver such further instruments
and do such further acts as may be reasonably necessary or proper to carry out
more effectively the purpose of this Indenture.
Section 3.26 Statements to Noteholders. On each Payment Date, the Indenture
Trustee and the Certificate Registrar shall prepare and make available on the
Indenture Trustee's website, https://www.jpmorgan.com/sfr (or deliver at the
recipient's option), to each Noteholder and Certificateholder, the Note Insurer,
and the Underwriter, the most recent statement prepared by the Indenture Trustee
pursuant to Section 7.05 hereof.
Section 3.27 [Reserved].
Section 3.28 Certain Representations Regarding the Trust Estate.
(a) With respect to that portion of the Collateral described in clauses (a)
through (d) of the definition of Trust Estate, the Issuing Entity represents to
the Indenture Trustee and the Note Insurer that:
(i) This Indenture creates a valid and continuing security interest
(as defined in the applicable UCC) in the Collateral 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
Issuing Entity.
(ii) The Collateral constitutes "deposit accounts", "chattel paper",
"general intangibles" or "instruments," as applicable, within the meaning
of the applicable UCC.
(iii) The Issuing Entity owns and has good and marketable title to the
Collateral, free and clear of any lien, claim or encumbrance of any Person.
(iv) Other than the security interest granted to the Indenture Trustee
pursuant to this Indenture, the Issuing Entity has not pledged, assigned,
sold, granted a security interest in, or otherwise conveyed any of the
Collateral.
(b) With respect to that portion of the Collateral described in clause (e)
of the definition of "Trust Estate", the Issuing Entity represents to the
Indenture Trustee and the Note Insurer that:
(i) This Indenture creates a valid and continuing security interest
(as defined in the applicable UCC) in the Collateral 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
Issuing Entity.
(ii) The Collateral constitutes "general intangibles" within the
meaning of the applicable UCC.
(iii) The Issuing Entity owns and has good and marketable title to the
Collateral, free and clear of any lien, claim or encumbrance of any Person.
14
(iv) Other than the security interest granted to the Indenture Trustee
pursuant to this Indenture, the Issuing Entity has not pledged, assigned,
sold, granted a security interest in, or otherwise conveyed any of the
Collateral.
(c) With respect to any Collateral in which a security interest may be
perfected by filing, the Issuing Entity has not authorized the filing of, and is
not aware of any financing statements against, the Issuing Entity, that include
a description of collateral covering such Collateral, other than any financing
statement relating to the security interest granted to the Indenture Trustee
hereunder or that has been terminated. The Issuing Entity is not aware of any
judgment or tax lien filings against the Issuing Entity.
(d) The Issuing Entity 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 all Collateral granted to the Indenture Trustee hereunder
in which a security interest may be perfected by filing. Any financing statement
that is filed in connection with this Section 3.28 shall contain a statement
that a purchase or security interest in any collateral described therein will
violate the rights of the secured party named in such financing statement.
(e) The foregoing representations may not be waived and shall survive the
issuance of the Notes.
ARTICLE IV
THE NOTES; SATISFACTION AND DISCHARGE OF INDENTURE
Section 4.01 The Notes. Each Class of Notes shall be issued in the form of
Book-Entry Notes and shall be registered in the name of a nominee designated by
the Depository. Beneficial Owners will hold interests in the Class A-1 Notes
through the book-entry facilities of the Depository in minimum initial Note
Balances of $100,000 and integral multiples of $1 in excess thereof. Beneficial
Owners will hold interests in the Class A-2 Notes through the book-entry
facilities of the Depository in minimum initial Note Balances of $25,000 and
integral multiples of $25,000 in excess thereof.
The Indenture Trustee may for all purposes (including the making of
payments due on the Notes) deal with the Depository (through and to its nominee)
as the authorized representative of the Beneficial Owners with respect to the
Book-Entry Notes for the purposes of exercising the rights of Holders of the
Book-Entry Notes hereunder. Except as provided in the next succeeding paragraph
of this Section 4.01, the rights of Beneficial Owners with respect to the
Book-Entry 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 hereof, Beneficial Owners shall not be
entitled to definitive notes for the Book-Entry Notes as to which they are the
Beneficial Owners. Requests and directions from, and votes of, the Depository as
Holder of the Book-Entry 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 Holders of Notes and give notice to the Depository of such record
date. Without the consent of the Issuing Entity and
15
the Indenture Trustee, no Offered Note may be transferred by the Depository
except to a successor Depository that agrees to hold such Offered Note for the
account of the Beneficial Owners.
In the event the Depository Trust Company resigns or is removed as
Depository, the Indenture Trustee with the approval of the Issuing Entity may
appoint a successor Depository. If no successor Depository has been appointed
within 30 days of the effective date of the Depository's resignation or removal,
each Beneficial Owner shall be entitled to certificates representing the
Book-Entry Notes it beneficially owns in the manner prescribed in Section 4.08.
The Notes shall, on original issue, be executed on behalf of the Issuing
Entity by the Owner Trustee, not in its individual capacity but solely as Owner
Trustee, authenticated by the Indenture Trustee and delivered by the Indenture
Trustee to or upon the order of the Issuing Entity.
Section 4.02 Registration of and Limitations on Transfer and Exchange of
Notes; Appointment of Note Registrar and Certificate Registrar. The Issuing
Entity shall cause to be kept at the Corporate Trust Office 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, the
Issuing Entity 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 evidencing the same Class and
aggregate Percentage Interests.
Subject to the foregoing, at the option of the Noteholders, Notes may be
exchanged for other Notes of like tenor and in authorized initial Note Balances
evidencing the same Class and aggregate Percentage Interests upon surrender of
the Notes to be exchanged at the Corporate Trust Office of the Note Registrar.
Whenever any Notes are so surrendered for exchange, the Issuing Entity shall
execute and the Indenture Trustee shall authenticate and deliver the Notes which
the Noteholder making the 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 be 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 located or
having a correspondent located in the city of New York. Notes delivered upon any
such transfer or exchange will evidence the same obligations, and will 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 Notes, 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 Notes.
The Issuing Entity hereby appoints the Indenture Trustee as (i) Certificate
Registrar to keep at its Corporate Trust Office a Certificate Register pursuant
to Section 3.09 of the Trust
16
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 3.05 of the Trust
Agreement and (ii) Note Registrar under this Indenture. The Indenture Trustee
hereby accepts such appointments.
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 Issuing Entity and the Indenture
Trustee harmless, then, in the absence of notice to the Issuing Entity, 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 Issuing Entity 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,
however, that if any such destroyed, lost or stolen Note, but not a mutilated
Note, shall have become or within seven days shall be due and payable, instead
of issuing a replacement Note, the Issuing Entity may pay such destroyed, lost
or stolen Note when so due or payable without surrender thereof. If, after the
delivery of such replacement Note or payment of a destroyed, lost or stolen Note
pursuant to the proviso to the preceding sentence, a bona fide purchaser of the
original Note in lieu of which such replacement Note was issued presents for
payment such original Note, the Issuing Entity and the Indenture Trustee shall
be entitled to recover such replacement Note (or such payment) from the Person
to whom it was delivered or any Person taking such replacement Note from such
Person to whom such replacement Note was delivered or any assignee of such
Person, except a bona fide purchaser, and shall be entitled to recover upon the
security or indemnity provided therefor to the extent of any loss, damage, cost
or expense incurred by the Issuing Entity or the Indenture Trustee in connection
therewith.
Upon the issuance of any replacement Note under this Section 4.03, the
Issuing Entity may require the payment by the Holder of such Note of a sum
sufficient to cover any tax or other governmental charge that may be imposed in
relation thereto and any other reasonable expenses (including the fees and
expenses of the Indenture Trustee) connected therewith.
Every replacement Note issued pursuant to this Section 4.03 in replacement
of any mutilated, destroyed, lost or stolen Note shall constitute an original
additional contractual obligation of the Issuing Entity, whether or not the
mutilated, destroyed, lost or stolen Note shall be at any time enforceable by
anyone, and shall be entitled to all the benefits of this Indenture equally and
proportionately with any and all other Notes duly issued hereunder.
The provisions of this Section 4.03 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 Issuing Entity, the Indenture Trustee,
the Note Insurer, the Paying Agent and any agent of the Issuing Entity or the
Indenture Trustee may treat the Person in whose name any Note is registered (as
of the day of determination) as the owner of such Note for the purpose of
receiving payments of principal of and interest, if any, on such Note and for
all other
17
purposes whatsoever, whether or not such Note be overdue, and neither the
Issuing Entity, the Indenture Trustee, the Note Insurer, the Paying Agent nor
any agent of the Issuing Entity 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 Issuing Entity may at any time
deliver to the Indenture Trustee for cancellation any Notes previously
authenticated and delivered hereunder which the Issuing Entity may have acquired
in any manner whatsoever, and all Notes so delivered shall be promptly cancelled
by the Indenture Trustee. No Notes shall be authenticated in lieu of or in
exchange for any Notes cancelled as provided in this Section 4.05, 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 unless the Issuing Entity shall
direct by an Issuing Entity Request that they be destroyed or returned to it;
provided, however, that such Issuing Entity Request is timely and the Notes have
not been previously disposed of by the Indenture Trustee.
Section 4.06 Book-Entry Notes. The Notes, upon original issuance, will be
issued in the form of typewritten Notes representing the Book-Entry Notes, to be
delivered to The Depository Trust Company, the initial Depository, by, or on
behalf of, the Issuing Entity. The 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 will receive a Definitive Note representing such
Beneficial Owner's interest in such Book-Entry Note, except as provided in
Section 4.08. With respect to such Book-Entry Notes, unless and until
definitive, fully registered Notes (the "Definitive Notes") have been issued to
Beneficial Owners pursuant to Section 4.08:
(i) the provisions of this Section 4.06 shall be in full force and
effect;
(ii) the Note Registrar, the Paying Agent, the Note Insurer 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 Book-Entry Notes and the giving of instructions or
directions hereunder) as the sole holder of the Book-Entry Notes, and shall
have no obligation to the Beneficial Owners of the Book-Entry Notes;
(iii) to the extent that the provisions of this Section 4.06 conflict
with any other provisions of this Indenture, the provisions of this Section
4.06 shall control;
(iv) the rights of Beneficial Owners shall be exercised only through
the Depository and shall be limited to those established by law and
agreements between such Owners of Book-Entry Notes and the Depository
and/or the Depository Participants. Unless and until Definitive Notes are
issued pursuant to Section 4.08, the initial Depository will make
book-entry transfers among the Depository Participants and receive and
transmit payments of principal of and interest on the Book-Entry Notes to
such Depository Participants; and
18
(v) whenever this Indenture requires or permits actions to be taken
based upon instructions or directions of Holders of Book-Entry Notes
evidencing a specified percentage of the Note Balances of the Notes, the
Depository shall be deemed to represent such percentage with respect to the
Book-Entry Notes only to the extent that it has received instructions to
such effect from Beneficial Owners and/or Depository Participants owning or
representing, respectively, such required percentage of the beneficial
interest in the Book-Entry Notes and has delivered such instructions to the
Indenture Trustee.
Section 4.07 Notices to Depository. Whenever a notice or other
communication to the Note Holders is required under this Indenture, unless and
until Definitive Notes shall have been issued to Beneficial Owners of Book-Entry
Notes pursuant to Section 4.08, the Indenture Trustee shall give all such
notices and communications specified herein to be given to Holders of the
Book-Entry Notes to the Depository, and shall have no obligation to the
Beneficial Owners thereof.
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 Book-Entry 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 to the extent permitted
pursuant to the Depository's rules, or (iii) after the occurrence of an Event of
Default, Beneficial Owners of Book-Entry Notes representing beneficial interests
aggregating at least a majority of the Note Balances of the Book-Entry Notes
advise the Depository in writing that the continuation of a book-entry system
through the Depository is no longer in the best interests of such Beneficial
Owners, then the Depository shall notify all Beneficial Owners of Book-Entry
Notes and the Indenture Trustee of the occurrence of any such event and of the
availability of Definitive Notes to such Beneficial Owners requesting the same.
Upon surrender to the Indenture Trustee of the typewritten Notes representing
the Book-Entry Notes by the Depository, accompanied by registration
instructions, the Issuing Entity shall execute and the Indenture Trustee shall
authenticate the Definitive Notes in accordance with the instructions of the
Depository. None of the Issuing Entity, 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 the Definitive Notes as Noteholders.
Section 4.09 Tax Treatment. The Issuing Entity has entered into this
Indenture, and the Notes will be issued with the intention that, for federal,
state and local income, single business and franchise tax purposes, the Notes
will qualify as indebtedness. The Issuing Entity and the Indenture Trustee (in
accordance with Section 6.06 hereof), by entering into this Indenture, and each
Noteholder, by its acceptance of its 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.
Section 4.10 Satisfaction and Discharge of Indenture. This Indenture shall
cease to be of further effect with respect to the Notes except as to (i) rights
of registration of transfer and exchange, (ii) substitution of mutilated,
destroyed, lost or stolen Notes, (iii) rights of Noteholders to receive payments
of principal thereof and interest thereon, (iv) Sections 3.03, 3.04, 3.06, 3.09,
19
3.17, 3.19 and 3.20, (v) 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 (vi)
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, and the
Indenture Trustee, on demand of and at the expense of the Issuing Entity, shall
execute proper instruments acknowledging satisfaction and discharge of this
Indenture with respect to the Notes and shall release and deliver the Collateral
to or upon the order of the Issuing Entity, when
(A) either
(1) all Notes theretofore authenticated and delivered (other than (i)
Notes that have been destroyed, lost or stolen and that have been replaced
or paid as provided in Section 4.03 hereof and (ii) Notes for whose payment
money has theretofore been deposited in trust or segregated and held in
trust by the Issuing Entity and thereafter repaid to the Issuing Entity or
discharged from such trust, as provided in Section 3.03) have been
delivered to the Indenture Trustee for cancellation; or
(2) all Notes not theretofore delivered to the Indenture Trustee for
cancellation (a) have become due and payable, (b) will become due and
payable at the Final Stated Maturity Date within one year, or (c) have been
called for early redemption pursuant to Section 8.07 hereof, and the
Issuing Entity, in the case of (a) or (b) 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 (which will mature prior to the date such amounts are payable), in
trust for such purpose, in an amount sufficient to pay and discharge the
entire indebtedness on such Notes then outstanding not theretofore
delivered to the Indenture Trustee for cancellation when due on the Final
Stated Maturity Date or other final Payment Date, or, in the case of (c)
above, the Issuing Entity shall have complied with all requirements of
Section 8.07 hereof,
(B) the Issuing Entity has paid or caused to be paid all other sums
payable hereunder and under the Insurance Agreement; and
(C) the Issuing Entity has delivered to the Indenture Trustee and the
Note Insurer an Officer's Certificate and an Opinion of Counsel, each
meeting the applicable requirements of Section 10.01 hereof, each stating
that all conditions precedent herein provided for relating to the
satisfaction and discharge of this Indenture have been complied with and,
if the Opinion of Counsel relates to a deposit made in connection with
Section 4.10(A)(2)(b) above, such opinion shall further be to the effect
that such deposit will constitute an "in-substance defeasance" within the
meaning of Revenue Ruling 85-42, 1985-1 C.B. 36, and in accordance
therewith, the Issuing Entity will be the owner of the assets deposited in
trust for federal income tax purposes.
Section 4.11 Application of Trust Money. All monies deposited with the
Indenture Trustee pursuant to Section 4.10 hereof shall be held in trust and
applied by it, in accordance with the provisions of the Notes and this
Indenture, to the payment, either directly or through any
20
Paying Agent or the Issuing Entity, Certificate Paying Agent as designee of the
Issuing Entity, as the Indenture Trustee may determine, to the Holders of Notes
or Certificates, of all sums due and to become due thereon for principal and
interest or otherwise; but such monies need not be segregated from other funds
except to the extent required herein or required by law.
Section 4.12 [Reserved].
Section 4.13 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 such Notes shall, upon demand of
the Issuing Entity, be paid to the Indenture Trustee to be held and applied
according to Section 3.05 and thereupon such Person shall be released from all
further liability with respect to such monies.
Section 4.14 Temporary Notes. Pending the preparation of any Definitive
Notes, the Issuing Entity may execute and upon its written direction, the
Indenture Trustee may authenticate and make available for delivery, temporary
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
Notes may determine, as evidenced by their execution of such Notes.
If temporary Notes are issued, the Issuing Entity will cause Definitive
Notes to be prepared without unreasonable delay. After the preparation of the
Definitive Notes, the temporary Notes shall be exchangeable for Definitive Notes
upon surrender of the temporary Notes at the office of the Indenture Trustee
located at c/o DTC Transfer Services, 55 Water Street, Jeanette Park Entrance,
New York, New York 10041, without charge to the Holder. Upon surrender for
cancellation of any one or more temporary Notes, the Issuing Entity 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, class and aggregate principal amount. Until so exchanged, such
temporary Notes shall in all respects be entitled to the same benefits under
this Indenture as Definitive Notes.
Section 4.15 Representation Regarding ERISA. By acquiring a Note or
interest therein, each Holder of such Note or Beneficial Owner of any such
interest will be deemed to represent that either (1) it is not acquiring the
Note with Plan Assets or (2) (A) the acquisition, holding and transfer of such
Note will not give rise to a non-exempt prohibited transaction under Section 406
of ERISA or Section 4975 of the Code and (B) the Notes are rated investment
grade or better and such person believes that the Notes are properly treated as
indebtedness without substantial equity features for purposes of the Department
of Labor regulation 29 C.F.R. Section 2510.3-101, and agrees to so treat the
Notes. Alternatively, regardless of the rating of the Notes, such person may
provide the Indenture Trustee and the Owner Trustee with an opinion of counsel,
which opinion of counsel will not be at the expense of the Issuing Entity, the
Seller, the Originator, any Underwriter, the Owner Trustee, the Indenture
Trustee, the Servicer or any successor servicer which opines that the
acquisition, holding and transfer of such Note or interest therein is
permissible under applicable law, will not constitute or result in a non-exempt
prohibited transaction under ERISA or Section 4975 of the Code and will not
subject the Issuing Entity, the
21
Seller, the Originator, the Depositor, the Owner Trustee, the Indenture Trustee,
the Servicer or any successor servicer to any obligation in addition to those
undertaken in the Indenture.
ARTICLE V
DEFAULT AND REMEDIES
Section 5.01 Events of Default. The Issuing Entity shall deliver to the
Indenture Trustee and the Note Insurer, written notice in the form of an
Officer's Certificate, within five days after learning of the occurrence of any
event which with the giving of notice and the lapse of time would become an
Event of Default under clause (iv), (v) or (vi) of the definition of "Event of
Default," its status and what action the Issuing Entity is taking or proposes to
take with respect thereto. The Indenture Trustee shall not be deemed to have
knowledge of any Event of Default unless a Responsible Officer has actual
knowledge thereof or unless written notice of such Event of Default is received
by a Responsible Officer and such notice references the Notes, the Trust Estate
or this Indenture.
Section 5.02 Acceleration of Maturity; Rescission and Annulment. If an
Event of Default should occur and be continuing, then and in every such case the
Indenture Trustee at the written direction of the Note Insurer or of the Holders
of Notes representing not less than 66-2/3% of the aggregate Note Balance of the
Notes (with the consent of the Note Insurer), shall declare that the aggregate
Note Balance of all Notes, together with accrued and unpaid interest thereon,
through the date of acceleration, shall become immediately due and payable.
At any time after such 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 in
this Article V provided, the Note Insurer or Holders of the Notes representing
not less than 66-2/3% of the aggregate Note Balance of the Notes (with the
consent of the Note Insurer), by written notice to the Issuing Entity and the
Indenture Trustee, may waive the related Event of Default and rescind and annul
such declaration and its consequences if:
(i) the Issuing Entity has paid or deposited with the Indenture
Trustee a sum sufficient to pay (a) all payments of principal of and
Interest Payment Amounts due 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; and (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
(ii) all Events of Default, other than the nonpayment of the principal
of the Notes that has become due solely by such acceleration, have been
cured or waived as provided in Section 5.12.
In the event any Notes are accelerated due to an Event of Default, the Note
Insurer has the right, but not the obligation, to make payments under the Policy
or otherwise of interest and
22
principal due on such Notes, in whole or in part, on any date or dates following
such acceleration as the Note Insurer in its sole discretion will elect.
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 Issuing Entity covenants that if an Event of Default has occurred
and is continuing, the Issuing Entity shall, upon demand of the Indenture
Trustee, at the direction of the Note Insurer or of Holders of not less than
66-2/3% of the aggregate Note Balances of the Notes (with the consent of the
Note Insurer), pay to the Indenture Trustee, for the benefit of the Holders of
Notes, the whole amount then due and payable on the Notes for principal and
interest, with interest at the applicable Note Rate upon the overdue principal
and any Available Funds Cap Carry-Forward Amount, and in addition thereto such
further amount as shall be sufficient to cover the costs and expenses of
collection, including the reasonable compensation, expenses, disbursements and
advances of the Indenture Trustee and its agents and counsel.
(b) In case the Issuing Entity 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 hereof may institute a
Proceeding for the collection of the sums so due and unpaid, and may prosecute
such Proceeding to judgment or final decree, and may enforce the same against
the Issuing Entity or other obligor upon the Notes and collect in the manner
provided by law out of the property of the Issuing Entity or other obligor the
Notes, wherever situated, the monies adjudged or decreed to be payable.
(c) If an Event of Default occurs and is continuing, the Indenture Trustee,
subject to the provisions of Section 10.16 hereof may, as more particularly
provided in Section 5.04 hereof, in its discretion, proceed to protect and
enforce its rights and the rights of the Noteholders, by such appropriate
Proceedings, as directed in writing by the Controlling Party, 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, relative to the Issuing Entity or any
other obligor upon the Notes or any Person having or claiming an ownership
interest in the Trust Estate, Proceedings under Title 11 of the United States
Code or any other applicable federal or state bankruptcy, insolvency or other
similar law, or in case a receiver, assignee or trustee in bankruptcy or
reorganization, liquidator, sequestrator or similar official shall have been
appointed for or taken possession of the Issuing Entity or its property or such
other obligor or Person, or in case of any other comparable judicial Proceedings
relative to the Issuing Entity or other obligor upon the Notes, or to the
creditors or property of the Issuing Entity or such other obligor, the Indenture
Trustee, as directed in writing by the Note Insurer or by Holders of at least
66-2/3% of the aggregate Note Balances of the Notes (with the consent of the
Note Insurer), irrespective of whether the principal of any Notes shall then be
due and payable as therein
23
expressed or by declaration or otherwise and irrespective of whether the
Indenture Trustee shall have made any demand pursuant to the provisions of this
Section, shall be entitled and empowered, by intervention in such Proceedings or
otherwise:
(i) to file and prove a claim or claims for the whole amount of
principal and interest owing and unpaid in respect of the Notes and to file
such other papers or documents as may be necessary or advisable in order to
have the claims of the Indenture Trustee (including any claim for
reasonable compensation to the Indenture Trustee and 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 predecessor Indenture
Trustee, except as a result of negligence or bad faith) and of the
Noteholders allowed in such Proceedings;
(ii) unless prohibited by applicable law and regulations, to vote on
behalf of the Holders of Notes in any election of a trustee, a standby
trustee or Person performing similar functions in any such Proceedings;
(iii) to collect and receive any monies or other property payable or
deliverable on any such claims and to distribute all amounts received with
respect to the claims of the Noteholders and the Note Insurer and of the
Indenture Trustee on their behalf, and
(iv) to file such proofs of claim and other papers or documents as may
be necessary or advisable in order to have the claims of the Indenture
Trustee or the Holders of Notes and the Note Insurer allowed in any
judicial proceedings relative to the Issuing Entity, its creditors and its
property; and any trustee, receiver, liquidator, custodian or other similar
official in any such Proceeding is hereby authorized by each of such
Noteholders and the Note Insurer to make payments to the Indenture Trustee
and, in the event that the Indenture Trustee shall consent to the making of
payments directly to such Noteholders and the Note Insurer, to pay to the
Indenture Trustee such amounts as shall be sufficient to cover reasonable
compensation to 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 predecessor Indenture Trustee.
(e) Nothing herein contained shall be deemed to authorize the Indenture
Trustee to authorize or consent to or vote for or accept or adopt on behalf of
any Noteholder or the Note Insurer any plan of reorganization, arrangement,
adjustment or composition affecting the Notes or the Note Insurer or the rights
of any Holder thereof or the Note Insurer or to authorize the Indenture Trustee
to vote in respect of the claim of any Noteholder or the Note Insurer in any
such proceeding except, as aforesaid, to vote for the election of a trustee in
bankruptcy or similar Person.
(f) All rights of action and of asserting claims under this Indenture, or
under any of the Notes, may be enforced by the Indenture Trustee without the
possession of any of the Notes or the production thereof in any trial or other
Proceedings relative thereto, and any such action or proceedings instituted by
the 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,
24
disbursements and compensation of the Indenture Trustee, each predecessor
Indenture Trustee and their respective agents and attorneys, shall be for the
ratable benefit of the Holders of the Notes, subject to Section 5.05 hereof.
(g) In any Proceedings brought by the Indenture Trustee (and also any
Proceedings 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 the Holders of the Notes, and it shall not be necessary to
make any Noteholder a party to any such Proceedings.
Section 5.04 Remedies; Priorities.
(a) If an Event of Default shall have occurred and be continuing and if an
acceleration has been declared and not rescinded pursuant to Section 5.02
hereof, the Indenture Trustee subject to the provisions of Section 10.16 hereof
may (with the consent of the Note Insurer if no Insurer Default has occurred),
and shall, at the written direction of the Controlling Party, do one or more of
the following (subject to Section 5.05 hereof):
(i) institute Proceedings in its own name and as trustee of an express
trust for the collection of all amounts then payable on the Notes or under
this Indenture with respect thereto, whether by declaration or otherwise
enforce any judgment obtained, and collect from the Issuing Entity and any
other obligor upon such Notes monies 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 Holders of the Notes; and
(iv) sell the Trust Estate or any portion thereof or rights or
interest therein, at one or more public or private sales called and
conducted in any manner permitted by law; 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 Note Insurer (unless an Insurer Default shall have occurred)
or the Holders of 100% of the aggregate Note Balance of the Notes (if an
Insurer Default shall have occurred), (B) the proceeds of such sale or
liquidation distributable to the Holders of the Notes and the Note Insurer
are sufficient to discharge in full all amounts then due and unpaid upon
such Notes for principal and interest and all amounts due and unpaid to the
Note Insurer or (C) the Indenture Trustee determines that the Contracts
will not continue to provide sufficient funds for the payment of principal
of and Interest Payment Amounts due on the applicable Notes as they would
have become due if the Notes had not been declared due and payable, and the
Indenture Trustee obtains the consent of the Note Insurer (unless an
Insurer Default shall have occurred) or of the Holders of at least 66-2/3%
of the aggregate Note Balance of the Notes (if an Insurer Default shall
have occurred). In determining such sufficiency or insufficiency with
respect to clause (B) and
25
(C), the Indenture Trustee may, but need not, obtain and rely upon written
advice or an opinion (obtained at the expense of the Trust) 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, so long as a
Servicer Event of Default has not occurred, any sale of the Trust Estate
shall be made subject to the continued servicing of the Contracts by the
Servicer as provided in the Servicing Agreement.
(b) If the Indenture Trustee collects any money or property pursuant to
this Article V, it shall pay out the money or property in the order of priority
set forth in Section 8.01 hereof.
The Indenture Trustee may fix a record date and Payment Date for any
payment to Noteholders pursuant to this Section 5.04. At least 15 days before
such record date, the Indenture Trustee shall mail to each Noteholder a notice
that states the record date, the Payment Date and the amount to be paid.
Section 5.05 Optional Preservation of the Trust Estate. If the Notes have
been declared to be 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 (with the consent of the Note Insurer if no
Insurer Default has occurred) may elect to take and maintain possession of the
Trust Estate. It is the desire of the parties hereto and the Noteholders and the
Note Insurer that there be at all times sufficient funds for the payment of
principal of and interest on the Notes, of all amounts payable to the Note
Insurer, and other obligations of the Issuing Entity and the Indenture Trustee
shall take such desire into account when determining whether or not to take and
maintain possession of the Trust Estate. In determining whether and how to take
and maintain possession of the Trust Estate, the Indenture Trustee may, but need
not, obtain and rely upon the written advice or 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 Holder of any Note shall have any
right to institute any Proceeding, judicial or otherwise, with respect to this
Indenture, or for the appointment of a receiver or trustee, or for any other
remedy hereunder, unless and subject to the provisions of Section 10.16 hereof
(i) such Holder has previously given written notice to the Indenture
Trustee of a continuing Event of Default;
(ii) the Holders of not less than 25% of the aggregate Note Balances
of the Notes have made a 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;
(iii) such Holder or Holders have offered to the Indenture Trustee
indemnity reasonably satisfactory to it against the costs, expenses and
liabilities to be incurred in complying with such request;
(iv) the Indenture Trustee for 60 days after its receipt of such
notice of request and offer of indemnity has failed to institute such
Proceedings;
26
(v) no direction inconsistent with such written request has been given
to the Indenture Trustee during such 60-day period by the Holders of at
least 66-2/3% of the Note Balances of the Notes; and
(vi) such Event of Default has occurred and is continuing.
(vii) the Note Insurer is not the Controlling Party.
It is understood and intended that no one or more Holders of Notes shall
have any right in any manner whatever by virtue of, or by availing of, any
provision of this Indenture to affect, disturb or prejudice the rights of any
other Holders of Notes or to obtain or to seek to obtain priority or preference
over any other Holders or to enforce any right under this Indenture, except in
the manner herein provided.
Section 5.07 Unconditional Rights of Noteholders To Receive Principal and
Interest. Notwithstanding any other provisions in this Indenture, the Holder of
any Note shall have the right, which is absolute and unconditional, to receive
payment of the principal of and interest, if any, on such Note on or after the
respective due dates thereof expressed in such Note or in this Indenture and to
institute suit for the enforcement of any such payment, and such right shall not
be impaired without the consent of such Holder.
Section 5.08 Restoration of Rights and Remedies. If the Indenture Trustee,
any Noteholder or the Note Insurer 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 or the Note Insurer, then and in every such case
the Issuing Entity, the Indenture Trustee, the Noteholders and the Note Insurer
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, the Noteholders and the Note Insurer
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 to the Noteholders or the
Note Insurer 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 Holder of any Note or the Note Insurer to exercise any
right or remedy accruing upon any 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 V or by law to the
Indenture Trustee or to the Noteholders or the Note Insurer may be exercised
from time to time, and as often as may be deemed expedient, by the Indenture
Trustee or by the Noteholders or the Note Insurer, as the case may be.
27
Section 5.11 Control By Noteholders. The Note Insurer or the Holders of not
less than 66-2/3% of the aggregate Note Balances of Notes (with the consent of
the Note Insurer) 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:
(i) such direction shall not be in conflict with any rule of law or
with this Indenture;
(ii) any direction to the Indenture Trustee to sell or liquidate the
Trust Estate shall be by the Note Insurer (if no Insurer Default has
occurred) or the Holders of Notes representing not less than 100% of the
Note Balances of the Notes (if an Insurer Default has occurred);
(iii) the Indenture Trustee has been provided with indemnity
satisfactory to it; and
(iv) the Indenture Trustee may take any other action deemed proper by
the Indenture Trustee that is not inconsistent with such direction of the
Note Insurer (if no Insurer Default has occurred) or Holders of Notes
representing 66-2/3% of the Note Balances of the Notes (if an Insurer
Default has occurred).
Notwithstanding the rights of the Note Insurer and the Noteholders set
forth in this Section 5.11 the Indenture Trustee need not take any action that
it determines might involve it in liability or if adequate indemnity is not
assured to it.
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 hereof,
the Note Insurer (if no Insurer Default has occurred) or the Holders of Notes
representing not less than 66-2/3% of the aggregate Note Balance of the Notes
(if an Insurer Default has occurred) 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 any of the Notes or (b) in respect of a covenant or provision
hereof which cannot be modified or amended without the consent of the Holder of
each Note. In the case of any such waiver, the Issuing Entity, the Indenture
Trustee, the Note Insurer and the Holders of the Notes shall be restored to
their former positions and rights hereunder, respectively, but no such waiver
shall extend to any subsequent or other 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; but 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. All parties to this Indenture agree,
and the Note Insurer and each Holder of any Note and each Beneficial Owner of
any interest therein by such Holder's or Beneficial Owner's acceptance thereof
shall be deemed to have agreed, that any court may in its discretion require, in
any suit for the enforcement of any right or remedy under this Indenture, or in
any suit against the Indenture Trustee for any action taken, suffered or omitted
by it as Indenture Trustee, the filing by any party litigant in such suit of an
undertaking to pay the costs of such suit, and that such court may in its
discretion assess reasonable costs,
28
including reasonable attorneys' fees, against any party litigant in such suit,
having due regard to the merits and good faith of the claims or defenses made by
such party litigant; but the provisions of this Section 5.13 shall not apply to
(a) any suit instituted by the Indenture Trustee, (b) any suit instituted by the
Note Insurer or by any Noteholder, or group of Noteholders, in each case holding
in the aggregate more than 10% of the Note Balances of the Notes or (c) any suit
instituted by the Note Insurer or by any Noteholder for the enforcement of the
payment of principal of or interest on any Note on or after the respective due
dates expressed in such Note and in this Indenture.
Section 5.14 Waiver of Stay or Extension Laws. The Issuing Entity covenants
(to the extent that it may lawfully do so) that it will not at any time insist
upon, or plead or in any manner whatsoever, claim or take the benefit or
advantage of, any stay or extension law wherever enacted, now or at any time
hereafter in force, that may affect the covenants or the performance of this
Indenture; and the Issuing Entity (to the extent that it may lawfully do so)
hereby expressly waives all benefit or advantage of any such law, and covenants
that it shall not hinder, delay or impede the execution of any power herein
granted to the Indenture Trustee, but will suffer and permit the execution of
every 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 (a "Sale") of any
portion of the Trust Estate pursuant to Section 5.04 hereof is expressly subject
to the provisions of Section 5.05 hereof and this Section 5.15. 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, but shall continue unimpaired
until the entire Trust Estate shall have been sold or all amounts payable on the
Notes and to the Note Insurer pursuant to this Indenture and all other amounts
due and payable under this Indenture shall 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) the Note Insurer (if no Insurer Default has occurred) or the
Holders of all Notes (if an Insurer Default has occurred) consent to or
direct the Indenture Trustee to make such Sale, or
(ii) the proceeds of such Sale would be not less than the entire
amount which would be payable to the Noteholders under the Notes and to the
Note Insurer and the Swap Provider hereunder, in full payment thereof in
accordance with Section 5.02 hereof, on the Payment Date next succeeding
the date of such Sale, or
(iii) the Indenture Trustee determines that the conditions for
retention of the Trust Estate set forth in Section 5.05 hereof cannot be
satisfied (in making any determination under this Section 5.15, the
Indenture Trustee may rely upon written
29
advice or an opinion of an Independent investment banking firm obtained and
delivered as provided in Section 5.05 hereof), and the Note Insurer (if no
Insurer Default has occurred) or the Holders of Notes representing at least
100% of the Note Balances of the Notes (if an Insurer Default has occurred)
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 Section 5.15(b).
(c) [Reserved].
(d) In connection with a Sale of all or any portion of the Trust Estate,
(i) any Holder or Holders of Notes may bid for and purchase the
property offered for sale, and upon compliance with the terms of sale may
hold, retain and possess and dispose of such property, without further
accountability, and may, in paying the purchase money therefor, deliver any
Notes or claims for interest thereon in lieu of cash up to the amount which
shall, upon distribution of the net proceeds of such sale, be payable
thereon, and 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 in connection with any Sale thereof, and, subject to any
requirements of, and to the extent permitted by, applicable law in
connection therewith, may purchase all or any portion of the Trust Estate
in a private sale, and, in lieu of paying cash therefor, may make
settlement for the purchase price by crediting the gross Sale price against
the sum of (A) the amount which would be payable to the Note Insurer and
the Holders of the Notes and Holders of Certificates on the Payment Date
next succeeding the date of such Sale and (B) the expenses of the Sale and
of any Proceedings in connection therewith which 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, prepared by the Issuing Entity and satisfactory
to the Indenture Trustee, 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 Issuing Entity 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 such a 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.
30
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, the Note Insurer or the Noteholders shall be impaired
by the recovery of any judgment by the Indenture Trustee against the Issuing
Entity or by the levy of any execution under such judgment upon any portion of
the Trust Estate or upon any of the assets of the Issuing Entity. Any money or
property collected by the Indenture Trustee shall be applied in accordance with
Section 5.04(b) hereof.
Section 5.17 Performance and Enforcement of Certain Obligations.
(a) Promptly following a request from the Indenture Trustee to do so, the
Issuing Entity in its capacity as holder of the Contracts, shall take all such
lawful action as the Indenture Trustee may request to cause the Issuing Entity
to compel or secure the performance and observance by the Seller, the Originator
and the Servicer, as applicable, of each of their obligations to the Issuing
Entity under or in connection with the Asset Purchase Agreement and the
Servicing Agreement, and to exercise any and all rights, remedies, powers and
privileges lawfully available to the Issuing Entity under or in connection with
the Asset Purchase Agreement and the Servicing Agreement to the extent and in
the manner directed by the Indenture Trustee, as pledgee of the Contracts,
including the transmission of notices of default on the part of the Seller, the
Originator or the Servicer thereunder and the institution of legal or
administrative actions or proceedings to compel or secure performance by the
Seller, the Originator or the Servicer of each of their obligations under the
Asset Purchase Agreement and the Servicing Agreement.
(b) The Indenture Trustee, as pledgee of the Contracts, may, and at the
direction (which direction shall be in writing or by telephone (confirmed in
writing promptly thereafter)) of the Controlling Party, shall exercise all
rights, remedies, powers, privileges and claims of the Issuing Entity against
the Seller, the Originator or the Servicer under or in connection with the Asset
Purchase Agreement and the Servicing Agreement, including the right or power to
take any action to compel or secure performance or observance by the Seller, the
Originator or the Servicer, as the case may be, of each of their obligations to
the Issuing Entity thereunder and to give any consent, request, notice,
direction, approval, extension or waiver under the Asset Purchase Agreement and
the Servicing Agreement, as the case may be, and any right of the Issuing Entity
to take such action shall not be suspended.
ARTICLE VI
THE INDENTURE TRUSTEE
Section 6.01 Duties of Indenture Trustee.
(a) If an Event of Default has occurred and is 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 or use under the circumstances in the conduct of such person's
own affairs.
31
(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 and conforming to the
requirements of this Indenture; however, the Indenture Trustee shall
examine the 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 6.01;
(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 from Noteholders or from the Issuing Entity, which
they are entitled to give under the Basic Documents.
(d) The Indenture Trustee shall not be liable for interest on any money
received by it.
(e) Money held in trust by the Indenture Trustee need not be segregated
from other trust 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 indemnity satisfactory to it 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) The Indenture Trustee shall act in accordance with Section 6.03 of the
Servicing Agreement.
32
Section 6.02 Rights of Indenture Trustee.
(a) The Indenture Trustee may conclusively rely on, and shall be fully
protected from acting or refraining from acting 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 the
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 an Officer's Certificate or Opinion of Counsel.
(c) The Indenture Trustee shall not be liable for any action it takes or
omits to take in good faith which it believes to be authorized or within its
rights or powers; provided, however, that the Indenture Trustee's conduct does
not constitute willful misconduct, negligence or bad faith.
(d) The Indenture Trustee may consult with counsel, and the advice or
Opinion of Counsel with respect to legal matters relating to the Basic Documents
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 or
in connection herewith in good faith and in accordance with the advice or
opinion of such counsel.
(e) The Indenture Trustee may execute any of the trusts or powers hereunder
or perform any duties hereunder, either directly or by or through agents,
attorneys, custodians or nominees appointed with due care, and shall not be
responsible for any willful misconduct or negligence on the part of any agent,
attorney, custodian or nominee so appointed.
(f) The Indenture Trustee or its Affiliates are permitted to receive
additional compensation that could be deemed to be in the Indenture Trustee's
economic self-interest for (i) serving as investment adviser, administrator,
shareholder, servicing agent, custodian or sub-custodian with respect to certain
of the Permitted Investments, (ii) using Affiliates to effect transactions in
certain Permitted Investments and (iii) effecting transactions in certain
Permitted Investments. Such compensation shall only be payable out of investment
earnings pursuant to clause (vi) of the definition of "Permitted Investments."
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 Notes
and may otherwise deal with the Issuing Entity or its Affiliates with the same
rights it would have if it were not Indenture Trustee, subject to the
requirements of the Trust Indenture Act. Any Note Registrar, co-registrar or
co-paying agent may do the same with like rights. However, the Indenture Trustee
must comply with Sections 6.11 and 6.12 hereof.
Section 6.04 Indenture Trustee's Disclaimer. The Indenture Trustee shall
not be responsible for and makes no representation as to the validity or
adequacy of this Indenture, the Collateral or the Notes, it shall not be
accountable for the Issuing Entity's use of the proceeds from the Notes, and it
shall not be responsible for any statement of the Issuing Entity in the
33
Indenture or 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. Subject to Section 5.01, the
Indenture Trustee shall promptly mail to each Noteholder and the Note Insurer
notice of the Event of Default after it is actually known to a Responsible
Officer of the Indenture Trustee, unless such Event of Default shall have been
waived or cured. Except in the case of an Event of Default in payment of
principal of or interest on any Note, the Indenture Trustee may withhold the
notice if and so long as it in good faith determines that withholding the notice
is in the interests of Noteholders.
Section 6.06 Reports by Indenture Trustee to Holders and Tax
Administration. The Indenture Trustee shall deliver to each Noteholder such
information as may be required to enable such holder to prepare its federal and
state income tax returns. The Indenture Trustee shall prepare and file (or cause
to be prepared and filed), on behalf of the Owner Trustee or the Issuing Entity,
any Form 1099 tax returns. All tax returns and information reports shall be
signed by the Owner Trustee as provided in Section 5.03 of the Trust Agreement.
Section 6.07 Compensation and Indemnity. The Indenture Trustee shall
withdraw from the Note Payment Account on each Payment Date and pay to itself
the Indenture Trustee Fee. The Indenture Trustee's compensation shall not be
limited by any law on compensation of a trustee of an express trust.
The Issuing Entity shall reimburse the Indenture Trustee for all reasonable
out-of-pocket expenses incurred or made by it, including costs of collection, in
addition to compensation for its services. Such expenses which shall be paid
solely from the Trust Estate in accordance with Section 8.02 shall include
reasonable compensation and expenses, disbursements and advances of the
Indenture Trustee's agents, counsel, accountants and experts. The Issuing Entity
shall indemnify the Indenture Trustee solely with payments from the Trust Estate
in accordance with Section 8.02 and hold it harmless against any and all claims,
taxes, penalties, losses, liabilities or expenses (including attorneys' fees and
expenses) of any kind whatsoever incurred by it in connection with the
administration of this Trust and the performance of its duties under any of the
Basic Documents. Notwithstanding the foregoing, each of the Indenture Trustee
and any director, officer, employee or agent of the Indenture Trustee shall also
be indemnified by the Trust and held harmless against any loss, liability or
expense (including reasonable attorney's fees and expenses) incurred in the
administration of its duties and responsibilities or the exercise of its rights
under the Interest Rate Swap Agreement or in connection with any claim or legal
action relating to the Interest Rate Swap Agreement that is the responsibility
of the Noteholders as provided herein. The Indenture Trustee shall notify the
Issuing Entity promptly of any claim for which it may seek indemnity. Failure by
the Indenture Trustee to so notify the Issuing Entity shall not relieve the
Issuing Entity of its obligations hereunder. The Issuing Entity shall defend any
such claim, and the Indenture Trustee may have separate counsel and the Issuing
Entity shall pay the fees and expenses of such counsel. The Issuing Entity is
not obligated to reimburse any expense or indemnify against any loss, liability
or expense incurred by the Indenture Trustee through the Indenture Trustee's own
willful misconduct, negligence or bad faith.
The Issuing Entity's payment obligations to the Indenture Trustee pursuant
to this Section 6.07 shall survive the discharge of this Indenture and the
termination or resignation of the
34
Indenture Trustee. When the Indenture Trustee incurs expenses after the
occurrence of an Event of Default with respect to the Issuing Entity, the
expenses are intended to constitute expenses of administration under Title 11 of
the United States Code or any other applicable federal or state bankruptcy,
insolvency or similar law.
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 6.08. The Indenture Trustee may resign at any
time by so notifying the Issuing Entity and the Note Insurer. The Controlling
Party may remove the Indenture Trustee by so notifying the Indenture Trustee and
may appoint a successor Indenture Trustee. The Issuing Entity shall remove the
Indenture Trustee if:
(i) the Indenture Trustee fails to comply with Section 6.11 hereof;
(ii) the Indenture Trustee is adjudged a bankrupt or insolvent;
(iii) a receiver or other public officer takes charge of the Indenture
Trustee or its property; or
(iv) 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
Issuing Entity shall promptly appoint a successor Indenture Trustee acceptable
to the Note Insurer.
A successor Indenture Trustee shall deliver a written acceptance of its
appointment to the retiring Indenture Trustee, the Note Insurer and to the
Issuing Entity. 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
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 30 days after
the retiring Indenture Trustee resigns or is removed, the retiring Indenture
Trustee, the Issuing Entity or the Controlling Party may petition any court of
competent jurisdiction for the appointment of a successor Indenture Trustee.
Notwithstanding the replacement of the Indenture Trustee pursuant to this
Section, the Issuing Entity's obligations under Section 6.07 shall continue for
the benefit of the retiring 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 of its corporate trust business or assets to, another
corporation or banking association, the resulting, surviving or transferee
corporation, without any further act, shall be the successor Indenture Trustee;
35
provided, that such corporation or banking association shall be otherwise
qualified and eligible under Section 6.11 hereof. The Indenture Trustee shall
provide the Rating Agencies with prior written notice of any such transaction.
If 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 and 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 trustee and deliver such Notes so
authenticated; and if at that time any of the Notes shall not have been
authenticated, any successor to the Indenture Trustee may authenticate such
Notes either in the name of any predecessor hereunder or in the name of the
successor to the Indenture Trustee; and in all such cases such certificates
shall have the full force which it is 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 provisions of this Indenture, at any time,
for the purpose of meeting any legal requirement of any jurisdiction in which
any part of the Trust Estate may at the time be located, the Indenture Trustee
with the consent of the Note Insurer 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, of all or any part of the
Trust Estate, 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
hereof, 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 hereof.
(b) Every separate trustee and co-trustee shall, to the extent permitted by
law, be appointed and act subject to the following provisions and conditions:
(i) all rights, powers, duties and obligations conferred or imposed
upon the 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.
36
(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. Every instrument
appointing any separate trustee or co-trustee shall refer to this Indenture and
the conditions of this Article VI. Each separate trustee and co-trustee, upon
its acceptance of the trusts conferred, shall be vested with the estates or
property specified in its instrument of appointment, either jointly with the
Indenture Trustee or separately, as may be provided therein, subject to all the
provisions of this Indenture, specifically including every provision of this
Indenture relating to the conduct of, affecting the liability of, or affording
protection to, the Indenture Trustee. Every 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. The Indenture Trustee shall at
all times satisfy the requirements of TIA Section 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 "Baa3" or better by Moody's and "BBB" or
better by S&P. The Indenture Trustee will provide copies of such reports to the
Note Insurer upon request. The Indenture Trustee shall comply with TIA Section
310(b), including the optional provision permitted by the second sentence of TIA
Section 310(b)(9); provided, however, that there shall be excluded from the
operation of TIA Section 310(b)(1) any indenture or indentures under which
other securities of the Issuing Entity are outstanding if the requirements for
such exclusion set forth in TIA Section 310(b)(1) are met.
Section 6.12 Preferential Collection of Claims Against Issuing Entity. The
Indenture Trustee shall comply with TIA Section 311(a), excluding any creditor
relationship listed in TIA Section 311(b). An Indenture Trustee who has
resigned or been removed shall be subject to TIA Section 311(a) to the extent
indicated.
Section 6.13 Representations and Warranties. The Indenture Trustee hereby
represents that:
(i) It is a national banking association duly organized, validly
existing and in good standing under the laws of the United States.
(ii) The execution and delivery of this Indenture by it, and the
performance and compliance with the terms of this Indenture by it, will not
violate its charter or bylaws.
37
(iii) It has the full power and authority to enter into and consummate
all transactions contemplated by this Indenture has duly authorized the
execution, delivery and performance of this Indenture, and has duly
executed and delivered this Indenture.
(iv) This Indenture, assuming due authorization, execution and
delivery by the Issuing Entity, constitutes a valid, legal and binding
obligation of it, enforceable against it in accordance with the terms
hereof, subject to (A) applicable bankruptcy, insolvency, receivership,
reorganization, moratorium and other laws affecting the enforcement of
creditors' rights generally, and (B) general principles of equity,
regardless of whether such enforcement is considered in a proceeding in
equity or at law.
Section 6.14 Directions to Indenture Trustee. The Indenture Trustee is
hereby directed:
(i) to accept the pledge of the Contracts and hold the assets of the
Trust Estate in trust for the Noteholders;
(ii) to authenticate and deliver the Notes substantially in the form
prescribed by Exhibits A-1 and A-2 to this Indenture in accordance with the
terms of this Indenture;
(iii) to execute and enter into the Initial Auction Agent Agreement
and the Insurance Agreement;
(iv) to appoint Computershare Trust Company, Inc. as the Initial
Auction Agent; and
(v) to take all other actions as shall be required to be taken by the
terms of this Indenture and the Basic Documents.
Section 6.15 The Agents. The provisions of this Indenture relating to the
limitations of the Indenture Trustee's liability and to its indemnity, rights
and protections shall inure also to the Paying Agent and Note Registrar.
ARTICLE VII
NOTEHOLDERS' LISTS AND REPORTS
Section 7.01 Issuing Entity To Furnish Indenture Trustee Names and
Addresses of Noteholders. The Issuing Entity will furnish or cause to be
furnished to the Indenture Trustee (a) 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 Holders of Notes as of such Record Date, (b) at
such other times as the Indenture Trustee may request in writing, within 30 days
after receipt by the Issuing Entity of any such request, a list of similar form
and content as of a date not more than 10 days prior to the time such list is
furnished; provided, however, that so long as the Indenture Trustee is the Note
Registrar, no such list shall be required to be furnished to the Indenture
Trustee. The Note Registrar will furnish to the Note Insurer in writing at such
times as the Note Insurer may request a copy of the list.
Section 7.02 Preservation of Information; Communications to Noteholders.
38
(a) The Indenture Trustee shall preserve, in as current a form as is
reasonably practicable, the names and addresses of the Holders of Notes
contained in the most recent list furnished to the Indenture Trustee as provided
in Section 7.01 hereof and the names and addresses of Holders of Notes 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 7.01
upon receipt of a new list so furnished.
(b) Noteholders may communicate pursuant to TIA Section 312(b) with other
Noteholders with respect to their rights under this Indenture or under the
Notes.
(c) The Issuing Entity, the Indenture Trustee and the Note Registrar shall
have the protection of TIA Section 312(c).
Section 7.03 Reserved.
Section 7.04 Reports by Indenture Trustee. If required by TIA Section
313(a), within 60 days after each January 30th beginning with March 31, 2007,
the Indenture Trustee shall mail to each Noteholder and the Note Insurer as
required by TIA Section 313(c) a brief report dated as of such date that
complies with TIA Section 313(a). The Indenture Trustee also shall comply with
TIA Section 313(b).
A copy of each report at the time of its mailing to Noteholders shall be
filed by the Indenture Trustee with the Commission via EDGAR and each stock
exchange, if any, on which the Notes are listed. The Issuing Entity shall notify
the Indenture Trustee and the Note Insurer if and when the Notes are listed on
any stock exchange.
Section 7.05 Statements to Noteholders.
(a) With respect to each Payment Date, the Indenture Trustee shall make
available via the Indenture Trustee's website https://www.jpmorgan.com/sfr or
deliver at the recipient's option to each Noteholder and each Certificateholder,
the Depositor, the Owner Trustee, the Certificate Paying Agent, the Underwriter,
the Swap Provider, the Note Insurer and each Rating Agency, a statement setting
forth the following information, calculated by the Indenture Trustee based on
the aggregate loan-level information provided to it by the Servicer, as to the
Notes (it being understood that the Servicer shall provide the information
described in clauses (iv), (v), (vi), (vii) and (viii) below in its Electronic
File delivered to the Indenture Trustee), to the extent applicable:
(i) the amount of the payment made on such Payment Date to the Holders
of the Notes of each Class allocable to principal;
(ii) the amount of the payment made on such Payment Date to the
Holders of the Notes of each Class allocable to interest;
(iii) the aggregate Servicing Fee received by the Servicer during the
related Due Period and such other customary information as the Indenture
Trustee deems necessary or desirable, or which a Noteholder or
Certificateholder reasonably requests, to enable Noteholders and
Certificateholders to prepare their tax returns;
39
(iv) the premium paid to the Note Insurer for such Payment Date and
the amount of any claim made under the Policy;
(v) the aggregate Principal Balance of the Contracts as of the end of
the related Due Period;
(vi) the number, aggregate principal balance, weighted average
remaining term to maturity and weighted average Contract Rate of the
Contracts as of the end of the related Due Period;
(vii) the number and aggregate unpaid principal balance of Contracts
(a) delinquent 30 to 59 days, (b) delinquent 60 to 89 days, (c) delinquent
90 or more days, in each case, as of the last day of the preceding calendar
month, (d) as to which repossession or foreclosure proceedings have been
commenced and (e) with respect to which the related Obligor has filed for
protection under applicable bankruptcy laws, with respect to whom
bankruptcy proceedings are pending or with respect to whom bankruptcy
protection is in force;
(viii) the aggregate amount of Principal Prepayments received during
the related Prepayment Period;
(ix) the aggregate amount of Realized Losses incurred during the
related Prepayment Period and the aggregate amount of Realized Losses
incurred since the Closing Date;
(x) the aggregate Note Balance of each Class of Notes, after giving
effect to the payments made on such Payment Date;
(xi) the Interest Payment Amount in respect of the Class A Notes for
such Payment Date and the Available Funds Cap Carry-Forward Amount, if any,
with respect to the Class A Notes on such Payment Date;
(xii) the Overcollateralization Target Amount for such Payment Date;
(xiii) the Overcollateralization Amount, if any, for such Payment
Date;
(xiv) the respective Note Rates applicable to each Class of Notes for
such Payment Date and the Available Funds Cap Carry-Forward Amount for each
Class of Notes, if any, for such Payment Date; and
(xv) the amount of such distribution to the Trust Certificate.
Items (i) through (iii) above shall be presented on the basis of a Note
having a $1,000 denomination. In addition, by January 31st of each calendar year
following any year during which the Notes are outstanding, the Indenture Trustee
shall furnish a report to each Noteholder and the Note Insurer of record if so
requested in writing at any time during each calendar year as to the aggregate
of amounts reported pursuant to (i) through (iii) with respect to the Notes for
such calendar year.
40
(b) The Indenture Trustee may conclusively rely upon the Electronic File
provided by the Servicer pursuant to Section 4.01 of the Servicing Agreement in
its preparation of its Statement to Noteholders.
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 Payments on the Notes. (a) On each Payment Date, the Indenture
Trustee shall withdraw from the Note Payment Account an amount equal to the
Amount Available for such Payment Date and pay the following amounts, in the
following order of priority:
(i) to the Indenture Trustee, the Indenture Trustee Fee, to the
Auction Agent, any Auction Agent Fees, to the Calculation Agent, any
Calculation Agent Fees and to the Broker-Dealer, any Broker-Dealer fees for
such Payment Date;
(ii) to the Swap Provider, any Net Swap Payment or any Swap
Termination Payment (not triggered by a Swap Provider Trigger Event) owed
to the Swap Provider pursuant to the Interest Rate Swap Agreement;
(iii) to the Note Insurer, the amount of the premium for the Policy,
and any unpaid premium with interest thereon at the Late Payment Rate;
(iv) to the Custodian, the Custodian Fee, and to the Indenture Trustee
any indemnities and reimbursements (such indemnities and reimbursements
collectively referred to as "amounts") (such amounts subject to a cap of
$100,000 per annum) due and unpaid to the Indenture Trustee;
(v) concurrently, to each Class of Class A Notes, the related Interest
Payment Amount for such Payment Date, pro rata based on the Interest
Payment Amount each Class is entitled to receive, with any shortfall in the
Amount Available being allocated pro rata on that basis;
(vi) to the Class A Notes, the Principal Payment Amount for such
Payment Date sequentially in the following order of priority:
41
(A) to the Class A-1 Notes, until the Note Balance of the Class
A-1 Notes has been reduced to zero; and
(B) to the Class A-2 Notes, until the Note Balance of the Class
A-2 Notes has been reduced to zero;
(vii) to the Note Insurer, to reimburse it for draws made on the
Policy, with interest thereon at the Late Payment Rate and any other
amounts owed to the Note Insurer pursuant to the Insurance Agreement;
(viii) to the Class A-1 and Class A-2 Notes, in that order, the
related Available Funds Cap Carry-Forward Amount for that Payment Date;
(ix) to the Indenture Trustee, any amounts incurred in excess of the
amount set forth in clause (iv) above, without regard to the annual cap on
such amounts;
(x) to the Owner Trustee for expenses incurred in connection with the
Trust Agreement;
(xi) to the Auction Agent and Broker-Dealer any indemnification
amounts owed to them under the Auction Agent Agreement or the applicable
Broker-Dealer Agreement;
(xii) to the Swap Provider, any Swap Termination Payment triggered by
a Swap Provider Trigger Event; and
(xiii) any remaining amounts to the Certificate Paying Agent for
payment to Holders of the Trust Certificate.
Draws, if any, on the Policy for a Payment Date will be paid to the Holders
of the Notes only, in respect of interest or principal, as applicable, in
accordance with the priorities set forth above.
Notwithstanding the prioritization of the payment of the Principal Payment
Amount pursuant to clause (vi) above, if the aggregate Note Balance of the Class
A Notes exceeds the Pool Principal Balance for that Payment Date (after
application of all payments on the Notes on such Payment Date, including any
amounts paid by the Note Insurer), the payment pursuant to clause (vi) above
will be made pro rata based on the Note Balances of the Class A Notes.
(b) Pursuant to Section 3.05 of the Servicing Agreement, funds in the Note
Payment Account shall remain uninvested unless the Indenture Trustee is
otherwise directed by the Servicer in accordance with Section 3.05 of the
Servicing Agreement.
(c) Each payment with respect to a Book-Entry Note shall be paid to the
Depository, as Holder thereof, and the Depository shall be responsible for
crediting the amount of such payment to the accounts of its Depository
Participants in accordance with its normal procedures. Each Depository
Participant shall be responsible for disbursing such payment to the Note Owners
that it represents and to each indirect participating brokerage firm (a
"brokerage firm" or
42
"indirect participating firm") for which it acts as agent. Each brokerage firm
shall be responsible for disbursing funds to the Note Owners that it represents.
None of the Indenture Trustee, the Note Registrar, the Paying Agent, the
Depositor or the Servicer shall have any responsibility therefor except as
otherwise provided by this Indenture or applicable law.
(d) On each Payment Date, the Certificate Paying Agent shall deposit in the
Certificate Distribution Account all amounts it received pursuant to this
Section 8.02 for the purpose of distributing such funds pursuant to the Trust
Agreement.
(e) Any installment of interest or principal, if any, payable on any Note
that is punctually paid or duly provided for by the Issuing Entity on the
applicable Payment Date shall, if such Holder shall have so requested at least
five Business Days prior to the related Record Date, be paid to each Holder of
record on the preceding Record Date, by wire transfer to an account specified in
writing by such Holder reasonably satisfactory to the Indenture Trustee as of
the preceding Record Date or in all other cases or if no such instructions have
been delivered to the Indenture Trustee, by check to such Noteholder mailed to
such Holder's address as it appears in the Note Register in the amount required
to be paid to such Holder on such Payment Date pursuant to such Holder's Notes;
provided, however, that the Indenture Trustee shall not pay to such Holders any
amount required to be withheld from a payment to such Holder by the Code.
(f) The Note Balance of each Note shall be due and payable in full on the
Final Stated Maturity Date for such Note as provided in the forms of Notes set
forth in Exhibits A-1 and A-2 to this Indenture. All principal payments on the
Notes shall be made to the Noteholders entitled thereto in accordance with the
Percentage Interests represented by such Notes. The Indenture Trustee shall
notify the Person in whose name a Note is registered at the close of business on
the Record Date preceding the Final Stated Maturity Date or other final Payment
Date (including any final Payment Date resulting from any redemption pursuant to
Section 8.07 hereof). Such notice shall to the extent practicable be mailed no
later than five Business Days prior to such Final Stated Maturity Date or other
final Payment Date and shall specify that payment of the principal amount and
any interest due with respect to such Note at the Final Stated Maturity Date or
other 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. No interest shall accrue on the Notes on or
after the Final Stated Maturity Date or any such other final Payment Date.
Section 8.03 Officer's Certificate. Except in the case of releases of
documents to the Servicer pursuant to Section 3.11 of the Servicing Agreement,
the Indenture Trustee shall receive at least seven Business Days' notice when
requested by the Issuing Entity to take any action pursuant to Section 8.05(a)
hereof, accompanied by copies of any instruments to be executed, and the
Indenture Trustee shall also 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 complied with.
Section 8.04 Termination Upon Distribution to Noteholders. This Indenture
and the respective obligations and responsibilities of the Issuing Entity and
the Indenture Trustee created hereby shall terminate upon the payment to
Noteholders, the Certificate Paying Agent on behalf
43
of the Owner Trustee, the Certificateholders and the Indenture Trustee of all
amounts required to be paid pursuant to Section 8.02(a) or Section 8.07 hereof;
provided, however, that in no event shall the trust created hereby continue
beyond the expiration of 21 years from the death of the survivor of the
descendants of Joseph P. Kennedy, the late ambassador of the United States to
the Court of St. James, living on the date hereof.
Section 8.05 Release of Trust Estate.
(a) Subject to the payment of its fees, expenses and indemnities, the
Indenture Trustee may, and when required by the provisions of this Indenture or
at the Controlling Party's direction 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, including for the purposes
of any repossession by the Servicer of a Contract pursuant to Section 3.11 of
the Servicing Agreement. No party relying upon an instrument executed by the
Indenture Trustee as provided in Article VIII hereunder 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 to the Indenture Trustee pursuant to this
Indenture and all sums due the Note Insurer under the Insurance Agreement (upon
receipt of notice of payment of such sums to the Note Insurer) 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 8.05 only upon receipt of a request from the
Issuing Entity accompanied by an Officers' Certificate and an Opinion of Counsel
stating that all applicable requirements have been satisfied, except releases to
the Servicer pursuant to Section 3.11 of the Servicing Agreement.
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.
Section 8.07 Optional Redemption of the Notes; Auction.
(a) (1) The Servicer, pursuant to Section 3.17 of the Servicing Agreement,
shall have the option to purchase all outstanding Contracts, effecting a
redemption of the Notes, in whole, but not in part, on any Payment Date on
or after the Payment Date on which the Pool Principal Balance is less than
or equal to 20% of the Cut-off Date Pool Balance. The aggregate redemption
price for the Notes will be equal to the Redemption Price as defined under
Section 3.17 of the Servicing Agreement, and shall be subject to the
limitations set forth in such Section 3.17.
(2) In addition, on any Payment Date occurring after August 2009, if
the Note Balance of the Class A-1 notes has been reduced to zero, the
Issuing Entity may redeem the Class A-2 Notes, and the Holders of the Class
A-2 Notes must surrender their Notes in exchange for the redemption price
equal to the Outstanding Principal Balance of such
44
Notes plus all accrued and unpaid interest thereon (the "Class A-2 Call
Price"). No such optional redemption may be effected unless all amounts due
and unpaid to the Swap Provider (including any Swap Termination Payments)
are paid in full, and no optional redemption may be effected without the
Note Insurer's consent unless (i) all amounts due and unpaid to the Note
Insurer are paid in full and (ii) it would not result in a draw on the
policy. In addition, it will be a condition precedent to the exercise of
the optional redemption as described in this Section 8.07(a)(2) that the
Note Insurer will have received the Insurer Call Premium (as described in
the Premium Letter) if any is then due and owing pursuant to the Premium
Letter.
(b) Following receipt of notice pursuant to Section 3.17(b) of the
Servicing Agreement or of a written notice from the Issuing Entity of its
election to redeem the Class A-2 Notes pursuant to Section 8.07(a)(2) above, the
Indenture Trustee shall provide notice to the Noteholders of the final payment
on the Notes. After receipt of the Redemption Price from the Servicer pursuant
to Section 3.17 of the Servicing Agreement or of the Class A-2 Call Price from
the Issuing Entity, as the case may be, the Indenture Trustee shall deposit the
Redemption Price or the Class A-2 Call Price into the Note Payment Account and
shall, on the Payment Date after receipt of the funds, apply such funds to make
final payments of principal and interest on the Notes in accordance with Section
8.02(a) hereof and payment in full to the Indenture Trustee, and this Indenture
shall be discharged subject to the provisions of Section 4.10 hereof. If for any
reason the amount deposited by the Servicer or the Issuing Entity, as
applicable, is not sufficient to make such redemption or such redemption cannot
be completed for any reason, the amount so deposited by the Servicer with the
Indenture Trustee shall be immediately returned to the Servicer in full and
shall not be used for any other purpose or be deemed to be part of the Trust
Estate.
Section 8.08 [Reserved].
Section 8.09 Interest Rate Swap Agreement. On each Payment Date for which
the Indenture Trustee has received a payment under the Interest Rate Swap
Agreement, the Indenture Trustee shall pay such amounts pursuant to the
priorities provided in Section 8.02. On each Payment Date, the Indenture Trustee
shall pay in accordance with the monthly report furnished by it with respect to
such Payment Date, pursuant to Section 7.05 in the order of priority and to the
extent specified in Section 8.02 of this Indenture, any payments made by the
Swap Provider to the Indenture Trustee on behalf of the Trust for such Payment
Date with respect to the Interest Rate Swap Agreement. The Indenture Trustee
shall pay all Net Swap Payments due to the Swap Provider from funds in the
Payment Account on the date when such payments are due to be paid pursuant to
the Interest Rate Swap Agreement.
Section 8.10 Rights of the Swap Provider. The Swap Provider shall be deemed
a third-party beneficiary of this Indenture to the same extent as if it were a
party hereto and shall have the right to enforce all obligations of the parties
to this Indenture, which obligations include but are not limited to the
obligation of the Indenture Trustee (a) to pay to the Swap Provider, pursuant to
the priorities provided in Section 8.02, any Net Swap Payment required pursuant
to the Interest Rate Swap Agreement and any Swap Termination Payment required
pursuant to the Interest Rate Swap Agreement, (b) to establish and maintain the
Note Payment Account, to make such deposits thereto, investments therein and
payments therefrom. For the protection and
45
enforcement of the provisions of this Section, the Swap Provider shall be
entitled to such relief as can be given either at law or in equity.
Section 8.11 Policy Payments.
(a) If the Indenture Trustee determines that an Insured Amount to be
covered by the Policy will exist for the related Payment Date, the Indenture
Trustee shall complete the notice in the form of Exhibit A to the Policy (the
"Notice") and submit such Notice in accordance with the Policy to the Note
Insurer no later than 12:00 P.M., New York City time, on the second Business Day
immediately preceding such Payment Date, as a claim for the amount of such
Insured Amount.
(b) Upon receipt of an Insured Amount from the Note Insurer on behalf of
the Holders of the Notes, the Indenture Trustee shall deposit such Insured
Amount in the Note Payment Account and distribute such amount only for purposes
of payment to the Notes of the Insured Amount for which a claim was made and
such amount may not be applied to satisfy any costs, expenses or liabilities of
the Seller, the Depositor, the Indenture Trustee, the Custodian, the Auction
Agent or the Broker Dealer. Amounts paid under the Policy, to the extent needed
to pay the Insured Amount, shall be disbursed from the Note Payment Account by
the Indenture Trustee to the Holders of the Notes in accordance with Section
8.02. It shall not be necessary for such payments to be made by checks or wire
transfers separate from the checks or wire transfers used to pay other
distributions to the Holders of the Notes with other funds available to make
such payment. However, the amount of any payment of principal or of interest on
the Notes to be paid from funds included in Insured Amounts shall be noted as
provided in paragraph (d) below and in the statement to be furnished to Holders
of the Notes pursuant to Section 7.05. Any Insured Amount remaining in the Note
Payment Account on the first Business Day following the later of (i) the related
Payment Date or (ii) the date received by the Indenture Trustee, shall be
returned to the Note Insurer pursuant to the written instructions of the Note
Insurer by the end of such Business Day.
(c) The Note Insurer's obligations under the Policy with respect to Insured
Payments will be discharged to the extent funds are transferred to the Indenture
Trustee as provided in the Policy, whether or not the funds are properly applied
by the Indenture Trustee.
(d) The Indenture Trustee shall keep a complete and accurate record of the
amount of interest and principal paid in respect of the Notes from moneys
received under the Policy. The Note Insurer shall have the right to inspect such
records at reasonable times during normal business hours upon one Business Day's
prior notice to the Indenture Trustee.
(e) In the event that a Responsible Officer of the Indenture Trustee has
received a certified copy of an order of the appropriate court that any Insured
Amount has been voided in whole or in part as a preference payment under
applicable bankruptcy law, the Indenture Trustee shall so notify the Note
Insurer, shall comply with the provisions of the Policy to obtain payment by the
Note Insurer of the related Preference Amount, and shall, at the time it
provides notice to the Note Insurer, notify, by mail, the Holders of the Notes
that, in the event any Holder's Insured Amount is so recovered, such Holder of a
Note will be entitled to payment pursuant to the Policy, a copy of which shall
be made available through the Indenture Trustee or the Note
46
Insurer, and the Indenture Trustee shall furnish to the Note Insurer, a copy of
its records evidencing the payments which have been made by the Indenture
Trustee and subsequently recovered from the Holders of the Notes, and dates on
which such payments were made. Preference Amounts paid under the Policy shall be
disbursed to the Holders of the Notes by the Indenture Trustee.
(f) The Indenture Trustee shall promptly notify the Note Insurer of any
proceeding or the institution of any action, of which a Responsible Officer of
the Indenture Trustee has actual knowledge, seeking the avoidance as a
preferential transfer under applicable bankruptcy, insolvency, receivership or
similar law (a "Preference Claim") of any distribution made with respect to the
Notes. Each Holder of a Note, by its purchase of such Note, the Depositor and
the Indenture Trustee agree that the Note Insurer (so long as no Note Insurer
Default exists) may at any time during the continuation of any proceeding
relating to a Preference Claim direct all matters relating to such Preference
Claim, including, without limitation, (i) the direction of any appeal of any
order relating to such Preference Claim and (ii) the posting of any surety or
performance bond pending any such appeal. In addition and without limitation of
the foregoing, the Note Insurer shall be subrogated to, and each Holder of a
Note and the Indenture Trustee hereby delegates and assigns to the Note Insurer,
to the fullest extent permitted by law, the rights of the Indenture Trustee and
each Holder of a Note in the conduct of any such Preference Claim, including,
without limitation, all rights of any party to any adversary proceeding or
action with respect to any court order issued in connection with any such
Preference Claim.
(g) The Indenture Trustee shall, upon retirement of the Notes, furnish to
the Note Insurer a notice of such retirement, and, upon retirement of the Notes
and the expiration of the term of the Policy, surrender the Policy to the Note
Insurer for cancellation.
(h) The Indenture Trustee will hold the Policy in trust as agent for the
Holders of the Notes for the purpose of making claims thereon and distributing
the proceeds thereof. Neither the Policy nor the amounts paid on the Policy will
constitute part of the Trust Estate created by this Indenture. Each Holder of
the Notes, by accepting its Notes, appoints the Indenture Trustee as attorney in
fact for the purpose of making claims on the Policy.
(i) Anything herein to the contrary notwithstanding, any payment with
respect to principal of or interest on the Notes which is made with moneys
received pursuant to the terms of the Policy shall not be considered payment of
the Notes from the Trust Estate. The Depositor and the Indenture Trustee
acknowledge, and each Holder by its acceptance of a Note agrees, that without
the need for any further action on the part of the Note Insurer, the Depositor
or the Indenture Trustee (a) to the extent the Note Insurer makes payments,
directly or indirectly, on account of principal of or interest on the Notes to
the Holders of such Notes, the Note Insurer will be fully subrogated to, and
each Holder of a Note and the Indenture Trustee hereby delegate and assign to
the Note Insurer, to the fullest extent permitted by law, the rights of such
Holders to receive such principal and interest from the Trust Estate, and (b)
the Note Insurer shall be paid such amounts from the sources and in the manner
provided herein for the payment of such amounts and as provided in this
Indenture. The Indenture Trustee shall cooperate in all respects with any
reasonable request by the Note Insurer for action to preserve or enforce the
Note Insurer's rights or interests under this Indenture without limiting the
rights or affecting the interests of the Holders as otherwise set forth herein.
47
(j) By accepting its Note, each Holder of a Note agrees that, unless a Note
Insurer Default exists, the Note Insurer shall be deemed to be the Holder of the
Note for all purposes (other than with respect to the receipt of payment on the
Notes) and shall have the right to exercise all rights (including, without
limitation, Voting Rights) of the Holders of the Notes under this Indenture and
under the Notes without any further consent of the Holders of the Notes. All
notices, statement reports or opinions required by this Indenture to be sent to
any Holders of Notes shall also be sent to the Note Insurer.
Section 8.12 Rights of the Note Insurer.
(a) The Note Insurer is an express third-party beneficiary of this
Indenture. The Indenture Trustee shall provide to the Note Insurer copies of any
report, notice, Opinion of Counsel, Officers' Certificate, request for consent
or request for amendment to any document related hereto promptly upon the
Indenture Trustee's production or receipt thereof, but only to the extent that
such item is required to be delivered to the Note Insurer hereunder.
(b) Unless a Note Insurer Default exists, there shall be no amendment to
this Indenture without first having obtained the prior written consent of the
Note Insurer and the Note Insurer shall have the right to exercise all rights of
the Controlling Party.
ARTICLE IX
SUPPLEMENTAL INDENTURES
Section 9.01 Supplemental Indentures Without Consent of Noteholders.
(a) Without the consent of the Holders of any Notes but with prior notice
to the Rating Agencies and with the consent of the Note Insurer, which consent
shall not be unreasonably withheld or delayed, the Issuing Entity and the
Indenture Trustee, when authorized by an Issuing Entity 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 TIA as in force at the date of the
execution thereof), in form satisfactory to the Indenture Trustee, for any of
the following purposes:
(i) to correct or amplify the description of any property at any time
subject to the lien of this Indenture, or better to assure, convey and
confirm unto the 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;
(ii) to evidence the succession, in compliance with the applicable
provisions hereof, of another person to the Issuing Entity, and the
assumption by any such successor of the covenants of the Issuing Entity
herein and in the Notes contained;
(iii) to add to the covenants of the Issuing Entity, for the benefit
of the Holders of the Notes, or to surrender any right or power herein
conferred upon the Issuing Entity;
(iv) to convey, transfer, assign, mortgage or pledge any property to
or with the Indenture Trustee;
48
(v) 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;
(vi) to make any other provisions with respect to matters or questions
arising under this Indenture or in any supplemental indenture; provided,
that such action (as evidenced by either (i) an Opinion of Counsel
delivered to the Servicer and the Indenture Trustee or (ii) confirmation
from the Rating Agencies that such amendment will not result in the
reduction or withdrawal of the rating of any Class of Notes) shall not
materially and adversely affect the interests of the Holders of the Notes;
(vii) 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 hereof; or
(viii) 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 indenture supplements shall be entered into
unless the Indenture Trustee shall have received an Opinion of Counsel as to the
enforceability of any such indenture supplement and to the effect that (i) such
indenture supplement is permitted hereunder and (ii) entering into such
indenture supplement will not result in a "substantial modification" of the
Notes under Treasury Regulation Section 1.1001-3 or adversely affect the status
of the Notes as indebtedness for federal income tax purposes.
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.
(b) The Issuing Entity and the Indenture Trustee, when authorized by an
Issuing Entity Request, may, also without the consent of any of the Holders of
the Notes and prior notice to the Rating Agencies and with the consent of the
Note Insurer, which consent shall not be unreasonably withheld or delayed, enter
into an indenture or indentures supplemental hereto for the purpose of adding
any provisions to, or changing in any manner or eliminating any of the
provisions of, this Indenture or of modifying in any manner the rights of the
Holders of the Notes under this Indenture; provided, however, that such action
as evidenced by an Opinion of Counsel, (i) is permitted by this Indenture, and
shall not (ii) adversely affect in any material respect the interests of any
Noteholder (which may be evidenced by confirmation from the Rating Agencies that
such amendment will not result in the reduction or withdrawal of the rating of
any Class of Notes) or (iii) if 100% of the Certificates are not owned by Origen
REIT or a direct or indirect qualified REIT subsidiary of Origen REIT, cause the
Issuing Entity to be subject to an entity level tax for federal income tax
purposes.
49
Section 9.02 Supplemental Indentures With Consent of Noteholders and Note
Insurer. The Issuing Entity and the Indenture Trustee, when authorized by an
Issuing Entity Request, also may, with prior notice to the Rating Agencies and,
with the consent of the Note Insurer and Holders of not less than a majority of
the Note Balance of each Class of Notes affected thereby, by Act (as defined in
Section 10.03 hereof) of such Holders delivered to the Issuing Entity and the
Indenture Trustee, enter into an indenture or indentures supplemental hereto for
the purpose of adding any provisions to, or changing in any manner or
eliminating any of the provisions of, this Indenture or of modifying in any
manner the rights of the Holders of the Notes under this Indenture; provided,
however, that no such supplemental indenture shall, without the consent of the
Holder of each Note affected thereby:
(i) change the date of payment of any installment of principal of or
interest on any Note, or reduce the principal amount thereof 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, or 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;
(ii) reduce the percentage of the Note Balances of the Notes, the
consent of the Holders of which is required for any such supplemental
indenture, or the consent of the Holders of which is required for any
waiver of compliance with certain provisions of this Indenture or certain
defaults hereunder and their consequences provided for in this Indenture;
(iii) 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";
(iv) reduce the percentage of the Note Balances of the Notes required
to direct the Indenture Trustee to direct the Issuing Entity to sell or
liquidate the Trust Estate pursuant to Section 5.04 hereof;
(v) modify any provision of this Section 9.02 except to increase any
percentage specified herein or to provide that certain additional
provisions of this Indenture or the Basic Documents cannot be modified or
waived without the consent of the Holder of each Note affected thereby;
(vi) modify any of the provisions of this Indenture in such manner as
to affect the calculation of the amount of any payment of interest or
principal due on any Note on any Payment Date (including the calculation of
any of the individual components of such calculation); or
(vii) 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
50
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 Issuing Entity (if 100% of the Certificates are not owned by
Origen REIT or a direct or indirect qualified REIT subsidiary of Origen REIT) to
be subject to an entity level tax.
Any such action shall not (as evidenced by either (i) an Opinion of Counsel
delivered to the Servicer, the Note Insurer and the Indenture Trustee or (ii)
confirmation from the Rating Agencies that such amendment will not result in the
reduction or withdrawal of the rating of any Class of Notes) adversely affect in
any material respect the interest of any Holder (other than a Holder who shall
consent to such supplemental indenture).
It shall not be necessary for any Act of Noteholders under this Section
9.02 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 Issuing Entity and the Indenture
Trustee of any supplemental indenture pursuant to this Section 9.02, the
Indenture Trustee shall mail to the Holders of the Notes to which such amendment
or supplemental indenture relates and the Note Insurer a notice setting forth in
general terms the substance of such supplemental indenture. Any failure of the
Indenture Trustee to mail such notice, or any defect therein, shall not,
however, in any way impair or affect the validity of any such supplemental
indenture.
Section 9.03 Execution of Supplemental Indentures. In executing, or
permitting the additional trusts created by, any supplemental indenture
permitted by this Article IX 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 hereof, shall be fully protected in relying
upon, an Opinion of Counsel stating that the execution of the supplemental
indenture is authorized or permitted under the Indenture and all conditions
precedent under the Indenture to the execution of such supplemental indenture
have been met. 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 Issuing Entity and the Holders of the Notes shall
thereafter be determined, exercised and enforced hereunder subject in all
respects to such modifications and amendments, and all the terms and conditions
of any such supplemental indenture shall be and be deemed to be part of the
terms and conditions of this Indenture for any and all purposes.
Section 9.05 Conformity with Trust Indenture Act. Every amendment of this
Indenture and every supplemental indenture executed pursuant to this Article IX
shall conform to the
51
requirements of the Trust Indenture Act as then in effect so long as this
Indenture shall then be qualified under the Trust Indenture Act.
Section 9.06 Reference in Notes to Supplemental Indentures. Notes
authenticated and delivered after the execution of any supplemental indenture
pursuant to this Article IX may, and if required by the 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 Issuing Entity or the
Indenture Trustee shall so determine, new Notes so modified as to conform, in
the opinion of the Indenture Trustee and the Issuing Entity, to any such
supplemental indenture may be prepared and executed by the Issuing Entity 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 Issuing Entity to the Indenture
Trustee to take any action under any provision of this Indenture, the Issuing
Entity 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
52
(v) if the signatory of such certificate or opinion is required to be
Independent, the statement required by the definition of the term
"Independent Certificate."
(b) (i) Prior to the deposit of any Collateral or other property or
securities with the Indenture Trustee that is to be made the basis for the
release of any property or securities subject to the lien of this
Indenture, the Issuing Entity shall, in addition to any obligation imposed
in Section 10.01(a) or elsewhere in this Indenture, furnish to the
Indenture Trustee and the Note Insurer an Officer's Certificate certifying
or stating the opinion of each person signing such certificate as to the
fair value (within 90 days prior to such deposit) to the Issuing Entity of
the Collateral or other property or securities to be so deposited and a
report from a nationally recognized accounting firm verifying such value.
(ii) Whenever the Issuing Entity 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 clause (i)
above, the Issuing Entity shall also deliver to the Indenture Trustee and
the Note Insurer an Independent Certificate from a nationally recognized
accounting firm as to the same matters, if the fair value of the securities
to be so deposited and of all other such securities made the basis of any
such withdrawal or release since the commencement of the then current
fiscal year of the Issuing Entity, as set forth in the certificates
delivered pursuant to clause (i) above and this clause (ii), is 10% or more
of the Note Balances of the Notes, but such a certificate need not be
furnished with respect to any securities so deposited, 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 Note Balances of the Notes.
(iii) Whenever any property or securities are to be released from the
lien of this Indenture, the Issuing Entity shall also furnish to the
Indenture Trustee and the Note Insurer an Officer's Certificate certifying
or stating the opinion of each person signing such certificate as to the
fair value (within 90 days prior to such release) of the property or
securities proposed to be released and stating that in the opinion of such
person the proposed release will not impair the security under this
Indenture in contravention of the provisions hereof.
(iv) Whenever the Issuing Entity 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 clause (iii)
above, the Issuing Entity shall also furnish to the Indenture Trustee and
the Note Insurer an Independent Certificate as to the same matters if the
fair value of the property or securities and of all other property or
securities released from the lien of this Indenture since the commencement
of the then-current calendar year, as set forth in the certificates
required by clause (iii) above and this clause (iv), equals 10% or more of
the Note Balances of the Notes, but such certificate need not be furnished
in the case of any release of property or securities if the fair value
thereof as set forth in the related Officer's Certificate is less than
$25,000 or less than one percent of the then Note Balances of the Notes.
53
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 Issuing Entity
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 Seller or the Issuing Entity, stating that the information with respect to
such factual matters is in the possession of the Seller or the Issuing Entity,
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 Issuing
Entity shall deliver any document as a condition of the granting of such
application, or as evidence of the Issuing Entity'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 Issuing Entity 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 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 Issuing
Entity. Such instrument or instruments (and the action embodied therein and
evidenced thereby) are herein sometimes referred to as the "Act" of the
Noteholders signing such instrument or instruments. Proof of execution of any
such instrument or of a writing appointing any such agent shall be sufficient
for any purpose of this Indenture and (subject to Section 6.01 hereof)
conclusive in
54
favor of the Indenture Trustee and the Issuing Entity, if made in the manner
provided in this Section 10.03 hereof.
(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 ownership of Notes shall be proved by the Note Registrar.
(d) Any request, demand, authorization, direction, notice, consent, waiver
or other action by the Holder of any Notes shall bind the Holder of every Note
issued upon the registration thereof or in exchange therefor or in lieu thereof,
in respect of anything done, omitted or suffered to be done by the Indenture
Trustee or the Issuing Entity in reliance thereon, whether or not notation of
such action is made upon such Note.
Section 10.04 Notices etc., to Indenture Trustee Issuing Entity and Rating
Agencies. Any request, demand, authorization, direction, notice, consent, waiver
or Act of Noteholders or other documents provided or permitted by this Indenture
shall be in writing and if such request, demand, authorization, direction,
notice, consent, waiver or act of Noteholders is to be made upon, given or
furnished to or filed with:
(i) the Indenture Trustee by any Noteholder or by the Issuing Entity
shall be sufficient for every purpose hereunder if made, given, furnished
or filed in writing to or with the Indenture Trustee at the Corporate Trust
Office. The Indenture Trustee shall promptly transmit any notice received
by it from the Noteholders to the Issuing Entity; or
(ii) the Issuing Entity by the Indenture Trustee or by any Noteholder
shall be sufficient for every purpose hereunder if in writing and mailed
first-class, postage prepaid to the Issuing Entity addressed to: Origen
Manufactured Housing Contract Trust 2006-A, in care of Wilmington Trust
Company, Rodney Square North, 1100 North Market Street, Wilmington,
Delaware 19890-0001, Attention: Corporate Trust Administration, or at any
other address previously furnished in writing to the Indenture Trustee by
the Issuing Entity. The Issuing Entity shall promptly transmit any notice
received by it from the Noteholders to the Indenture Trustee.
Notices required to be given to the Rating Agencies by the Issuing Entity,
the Indenture Trustee or the Owner Trustee shall be in writing, mailed
first-class postage pre-paid or electronically delivered, to (i) in the case of
Moody's, at the following address: Moody's Investors Service, Inc., Residential
Mortgage Monitoring Department, 99 Church Street, New York, New York 10007 and
(ii) in the case of S&P, to Standard & Poor's via electronic delivery at
Servicer_reports@sandp.com (or if electronic delivery is not available at: 55
Water Street, 41st Floor, New York, New York 10041, Attn: ABS Surveillance
Group), or as to each of the foregoing, at such other address as shall be
designated by written notice to the other parties.
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 affected by such event, at such
Person'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
55
any case where notice to Noteholders is given by mail, neither the failure to
mail such notice nor any defect in any notice so mailed to any particular
Noteholder shall affect the sufficiency of such notice with respect to other
Noteholders, and any notice that is mailed in the manner 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, such notice may be
waived in writing by any Person entitled to receive such notice, either before
or after the event, and such waiver shall be the equivalent of such notice.
Waivers of notice by Noteholders shall be filed with the Indenture Trustee but
such filing shall not be a condition precedent to the validity of any action
taken in reliance upon such a waiver.
In case, by reason of the suspension of regular mail service as a result of
a strike, work stoppage or similar activity, it shall be impractical to mail
notice of any event to Noteholders when such notice is required to be given
pursuant to any provision of this Indenture, then any manner of giving such
notice as shall be satisfactory to the Indenture Trustee shall be deemed to be a
sufficient giving of such notice.
Where this Indenture provides for notice to the Rating Agencies, failure to
give such notice shall not affect any other rights or obligations created
hereunder, and shall not under any circumstance constitute an Event of Default.
Section 10.06 Conflict with Trust Indenture Act. If any provision hereof
limits, qualifies or conflicts with another provision hereof that is required to
be included in this Indenture by any of the provisions of the TIA, such required
provision shall control.
The provisions of TIA Sections 310 through 317 that impose duties on any
Person (including the provisions automatically deemed included herein unless
expressly excluded by this Indenture) are a part of and govern this Indenture,
whether or not physically contained herein.
Section 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 by the Issuing Entity shall bind its successors and
assigns, whether so expressed or not. All agreements of the Indenture Trustee in
this Indenture shall bind its successors, co-trustees and agents.
Section 10.09 Separability. In case any provision in this Indenture or in
the Notes shall be invalid, illegal or unenforceable, the validity, legality,
and enforceability of the remaining provisions shall not in any way be affected
or impaired thereby.
Section 10.10 Third Party Beneficiaries. Each of the Owner Trustee and the
Note Insurer shall be an express third-party beneficiary of this Indenture and
shall be entitled to enforce the provisions hereof to the same extent as if each
of the Owner Trustee and the Note Insurer was a party hereto.
56
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 REFERENCE TO ITS
CONFLICT OF LAW PROVISIONS (EXCEPT SECTION 5-1401 OF THE NEW YORK GENERAL
OBLIGATIONS LAW), 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 Issuing Entity and at its expense accompanied by an Opinion of
Counsel at its expense (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 Issuing Entity Obligation. No recourse may be taken, directly
or indirectly, with respect to the obligations of the Issuing Entity, 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 Issuing Entity 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 Issuing Entity, 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 individual capacity) and except that
any such partner, owner or beneficiary shall be fully liable, to the extent
provided by applicable law, for any unpaid consideration for stock, unpaid
capital contribution or failure to pay any installment or call owing to such
entity. For all purposes of this Indenture, in the performance of any duties or
obligations of the Issuing Entity hereunder, the Owner Trustee shall be subject
to, and entitled to the benefits of, the terms and provisions of Article VI, VII
and VIII of the Trust Agreement.
Section 10.16 No Petition. The Indenture Trustee, by entering into this
Indenture, and each Noteholder, by accepting a Note, hereby covenant and agree
that they will not at any time prior to one year from the date of termination
hereof, institute against the Depositor or the Issuing Entity, or join in any
institution against the Depositor or the Issuing Entity of, any bankruptcy,
reorganization, arrangement, insolvency or liquidation proceedings, or other
57
proceedings under any United States federal or state bankruptcy or similar law
in connection with any obligations relating to the Notes, this Indenture or any
of the Basic Documents, except for filing proofs of claim.
Section 10.17 Inspection. The Issuing Entity agrees that, at its expense,
on reasonable prior notice, it shall permit any representative of the Indenture
Trustee and the Note Insurer, during the Issuing Entity's normal business hours,
to examine all the books of account, records, reports and other papers of the
Issuing Entity, to make copies and extracts therefrom, to cause such books to be
audited by Independent certified public accountants, and to discuss the Issuing
Entity's affairs, finances and accounts with the Issuing Entity'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
cause its representatives to hold in confidence all such information except to
the extent disclosure may be required by law (and all reasonable applications
for confidential treatment are unavailing) and except to the extent that the
Indenture Trustee may reasonably determine that such disclosure is consistent
with its obligations hereunder.
Section 10.18 No Recourse to Owner Trustee. It is expressly understood and
agreed by the parties hereto that (a) this Indenture is executed and delivered
by Wilmington Trust Company, not individually or personally, but solely as Owner
Trustee of Origen Manufactured Housing Contract Trust 2006-A, in the exercise of
the powers and authority conferred and vested in it, (b) each of the
representations, undertakings and agreements herein made on the part of the
Issuing Entity is made and intended not as personal representations,
undertakings and agreements by Wilmington Trust Company but is made and intended
for the purpose for binding only the Issuing Entity, (c) nothing herein
contained shall be construed as creating any liability of Wilmington Trust
Company, individually or personally, to perform any covenant either expressed or
implied contained herein, all such liability, if any, being expressly waived by
the parties hereto and by any Person claiming by, through or under the parties
hereto and (d) under no circumstances shall Wilmington Trust Company be
personally liable for the payment of any indebtedness or expenses of the Issuing
Entity or be liable for the breach or failure of any obligation, representation,
warranty or covenant made or undertaken by the Issuing Entity under this
Indenture or any other related documents.
Section 10.19 Proofs of Claim. The Indenture Trustee is authorized 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 (including any
claim for the reasonable compensation, expenses, disbursements and advances of
the Indenture Trustee, its agents and counsel) and the Noteholders allowed in
any judicial proceedings relative to the Issuing Entity (or any other obligor
upon the Notes), its creditors or its property and shall be entitled and
empowered to collect, receive and distribute any money or other property payable
or deliverable on any such claims and any custodian in any such judicial
proceeding is hereby authorized by each Noteholder to make such payments to the
Indenture Trustee, as administrative expenses associated with any such
proceeding, and, in the event that the Indenture Trustee shall consent to the
making of such payments directly to the Noteholder to pay to the Indenture
Trustee any amount due to it for the reasonable compensation, expenses,
disbursements and advances of the Indenture Trustee, its agents and counsel, and
any other amounts due to the Indenture Trustee under Section 6.07 hereof. To the
extent that the payment of any such compensation, expenses,
58
disbursements and advances of the Indenture Trustee, its agents and counsel, and
any other amounts due the Indenture Trustee under Section 6.07 hereof out of the
estate in any such proceeding, shall be denied for any reason, payment of the
same shall be secured by a Lien on, and shall be paid out of, any and all
distributions, dividends, money, securities and other properties that the
Noteholders may be entitled to receive in such proceeding whether in liquidation
or under any plan of reorganization or arrangement or otherwise. Nothing herein
contained shall be deemed to authorize the Indenture Trustee to authorize or
consent to or accept or adopt on behalf of any Noteholder any plan of
reorganization, arrangement, adjustment or composition affecting the Noteholder
of the rights of any Noteholder thereof, or to authorize the Indenture Trustee
to vote in respect of the claim of any Noteholder in any such proceeding.
Section 10.20 Rights of the Note Insurer. All rights of the Note Insurer
hereunder to consent to or direct actions and matters shall not apply while a
Note Insurer Default is in effect.
59
IN WITNESS WHEREOF, the Issuing Entity 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.
ORIGEN MANUFACTURED HOUSING CONTRACT
TRUST 2006-A, as Issuing Entity
By: Wilmington Trust Company, not in its
individual capacity but solely as Owner
Trustee
By: /s/ Mary Kay Pupillo
------------------------------------
Name: Mary Kay Pupillo
Title: Assistant Vice President
JPMORGAN CHASE BANK, NATIONAL
ASSOCIATION, as Indenture Trustee
By: /s/ Keith Richardson
------------------------------------
Name: Keith Richardson
Title: Attorney-In-Fact
(Signature Page to Origen 2006-A Indenture)
STATE OF ILLINOIS )
) ss.:
CITY/COUNTY OF COOK )
On this 22nd day of August, 2006, before me personally appeared Mary Kay
Pupillo to me known, who being by me duly sworn, did depose and say, that he is
an AVP of the Indenture Trustee, one of the corporations described in and which
executed the above instrument; and that he signed his name thereto by like
order.
Notary Public
/s/ Susanne M. Gula
----------------------------------------
NOTARY PUBLIC
My Commission Expires November 21, 2007
[NOTARIAL SEAL]
Susanne M Gula
Notary Public - State of Delaware
My Comm. Expires on Nov. 21, 2007
STATE OF DELAWARE )
) ss.:
CITY/COUNTY OF NEW CASTLE )
On this 22nd day of August, 2006, before me personally appeared Keith
Richardson to me known, who being by me duly sworn, did depose and say, that
such person is a Attorney-In-Fact of the Owner Trustee on behalf of Origen
Manufactured Housing Contract Trust 2006-A, a Delaware statutory trust, one of
the entities described in and which executed the above instrument; and that she
signed her name thereto by like order.
Notary Public
/s/ Susie Moy
----------------------------------------
NOTARY PUBLIC
My Commission Expires July 5, 2010
[NOTARIAL SEAL]
Official Seal
Susie Moy
Notary Public - State of Illinois
My Commission Expires: 07/05/10
EXHIBIT A-1
FORM OF CLASS A-1 NOTES
UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY
TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE INDENTURE TRUSTEE OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY NOTE ISSUED IS
REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO
SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY
TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON
IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN.
THE HOLDER OF THIS NOTE OR BENEFICIAL OWNER OF ANY INTEREST HEREIN WILL BE
DEEMED TO REPRESENT TO ONE OF THE REPRESENTATIONS CONTAINED IN SECTION 4.15 OF
THE INDENTURE.
THIS NOTE IS A NON-RECOURSE OBLIGATION OF THE ISSUING ENTITY, AND IS LIMITED IN
RIGHT OF PAYMENT TO AMOUNTS AVAILABLE FROM THE TRUST AS PROVIDED IN THE
INDENTURE REFERRED TO BELOW. THE ISSUING ENTITY IS NOT OTHERWISE PERSONALLY
LIABLE FOR PAYMENTS ON THIS NOTE.
PRINCIPAL OF THIS NOTE IS PAYABLE OVER TIME AS SET FORTH HEREIN. ACCORDINGLY,
THE OUTSTANDING NOTE BALANCE OF THIS NOTE AT ANY TIME MAY BE LESS THAN THE
AMOUNT SHOWN ON THE FACE HEREOF.
A-1-1
ORIGEN MANUFACTURED HOUSING CONTRACT TRUST
COLLATERALIZED NOTES, SERIES 2006-A
CLASS A-1
AGGREGATE NOTE BALANCE: NOTE RATE: [___]% (Subject to
$_________________________________ Available Funds Rate)
INITIAL NOTE BALANCE OF THIS BOND: BOND NO. 1
$_________________________________
PERCENTAGE INTEREST: 100% CUSIP NO. [___]
Origen Manufactured Housing Contract Trust 2006-A (the "Issuing Entity"), a
Delaware statutory trust, for value received, hereby promises to pay to Cede &
Co. or registered assigns, the principal sum of ($) in monthly installments on
the fifteenth day of each month or, if such day is not a Business Day, the next
succeeding Business Day (each a "Payment Date"), commencing in September 2006
and ending on or before the Payment Date occurring on the Final Stated Maturity
Date and to pay interest on the Note Balance of this Note (this "Note")
outstanding from time to time as provided below.
This Note is one of a duly authorized issue of the Origen Manufactured
Housing Contract Trust Collateralized Notes, Series 2006-A (the "Notes"), issued
under an Indenture dated as of August 1, 2006 (the "Indenture"), between the
Issuing Entity and JPMorgan Chase Bank, National Association, as indenture
trustee (the "Indenture Trustee", which term includes any successor Indenture
Trustee under the Indenture), to which Indenture and all indentures supplemental
thereto reference is hereby made for a statement of the respective rights
thereunder of the Issuing Entity, the Indenture Trustee, the Owner Trustee and
the Holders of the Notes and the terms upon which the Notes are to be
authenticated and delivered. All terms used in this Note which are defined in
the Indenture shall have the meanings assigned to them in the Indenture.
Payments of principal and interest on this Note will be made on each
Payment Date to the Noteholder of record as of the related Record Date. The
"Note Balance" of a Note as of any date of determination is equal to the initial
Note Balance thereof, reduced by the aggregate of all amounts previously paid
with respect to such Note on account of principal on all prior Payment Dates.
The principal of, and interest on, this Note are due and payable as
described in the Indenture, 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 Issuing Entity with respect to this Note
shall be equal to this Note's pro rata share of the aggregate payments on all
Class A-1 Notes as described above, and shall be applied as between interest and
principal as provided in the Indenture.
A-1-2
All principal and interest accrued on the Notes, if not previously paid,
will become finally due and payable at the Final Stated Maturity Date.
The Notes are subject to redemption in whole, but not in part, by the
Servicer on any Payment Date on or after the Payment Date on which the Pool
Principal Balance is less than or equal to 20% of the aggregate Principal
Balance of the Contracts as of Cut-off Date.
The Issuing Entity shall not be liable upon the indebtedness evidenced by
the Notes except to the extent of amounts available from the Trust Estate which
constitute security for the payment of the Notes. The assets included in the
Trust Estate will be the sole source of payments on the Notes, and each Holder
hereof, by its acceptance of this Note, agrees that (i) such Note will be
limited in right of payment to amounts available from the Trust Estate as
provided in the Indenture and (ii) such Holder shall have no recourse to the
Issuing Entity, the Owner Trustee, the Indenture Trustee, the Seller, the
Originator, the Servicer or any of their respective affiliates, or to the assets
of any of the foregoing entities, except the assets of the Issuing Entity
pledged to secure the Notes pursuant to the Indenture and the rights conveyed to
the Issuing Entity under the Indenture.
Any payment of principal or interest payable on this Note shall be paid to
the Person in whose name such Note is registered at the close of business on the
Record Date for such Payment Date by wire transfer to an account in the United
States designated by such Holder, except for the final installment of principal
and interest payable with respect to such Note, which shall be payable as
provided below. Notwithstanding the foregoing, upon written request with
appropriate instructions by the Holder of this Note delivered to the Indenture
Trustee at least five Business Days prior to the Record Date, any payment of
principal or interest, other than the final installment of principal or
interest, shall be made by check mailed to such person's address as it appears
in the Note Register on such Record Date. All reductions in the Note Balance of
a Note (or one or more predecessor Notes) effected by payments of principal made
on any Payment Date shall be binding upon all Holders of this Note and of any
note issued upon the registration of transfer thereof or in exchange therefor or
in lieu thereof, whether or not such payment is noted on such Note. The final
payment of this Note shall be payable upon presentation and surrender thereof on
or after the Payment Date thereof at the Corporate Trust Office or the office or
agency of the Issuing Entity maintained by it for such purpose pursuant to
Section 3.02 of the Indenture.
Subject to the foregoing provisions, each Note delivered under the
Indenture, upon registration of transfer of or in exchange for or in lieu of any
other Note shall carry the right to unpaid principal and interest that were
carried by such other Note.
If an Event of Default as defined in the Indenture shall occur and be
continuing with respect to the Notes, the Notes may become or be declared due
and payable in the manner and with the effect provided in the Indenture. If any
such acceleration of maturity occurs prior to the payment of the entire unpaid
Note Balance of the Notes, the amount payable to the Holder of this Note will be
equal to the sum of the unpaid Note Balance of the Notes, together with accrued
and unpaid interest thereon as described in the Indenture. The Indenture
provides that, notwithstanding the acceleration of the maturity of the Notes,
under certain circumstances specified therein, all amounts collected as proceeds
of the Trust Estate securing the Notes or
A-1-3
otherwise shall continue to be applied to payments of principal of and interest
on the Notes as if they had not been declared due and payable.
The Holder of this Note or Beneficial Owner of any interest herein is
deemed to represent that either (1) it is not acquiring this Note with Plan
Assets or (2) (A) the acquisition, holding and transfer of this Note will not
give rise to a nonexempt prohibited transaction under Section 406 of ERISA or
Section 4975 of the Code and (B) this Note is rated investment grade or better
and such person believes that this Note is properly treated as indebtedness
without substantial equity features for purposes of the DOL Regulations, and
agrees to so treat this Note. Alternatively, regardless of the rating of this
Note, such person may provide the Indenture Trustee and the Owner Trustee with
an opinion of counsel, which opinion of counsel will not be at the expense of
the Issuing Entity, the Seller, the Originator, any Underwriter, the Owner
Trustee, the Indenture Trustee, the Servicer or any successor servicer which
opines that the acquisition, holding and transfer of this Note or interest
herein is permissible under applicable law, will not constitute or result in a
non-exempt prohibited transaction under ERISA or Section 4975 of the Code and
will not subject the Issuing Entity, the Seller, the Originator, the Depositor,
any Underwriter, the Owner Trustee, the Indenture Trustee, the Servicer or any
successor servicer to any obligation in addition to those undertaken in the
Indenture.
As provided in the Indenture and subject to certain limitations therein set
forth, the transfer of this Note may be registered on the Note Register of the
Issuing Entity. Upon surrender for registration of transfer of, or presentation
of a written instrument of transfer for, this Note at the office or agency
designated by the Issuing Entity pursuant to the Indenture, accompanied by
proper instruments of assignment in form satisfactory to the Indenture Trustee,
one or more new Notes of any authorized denominations and of a like aggregate
initial Note Balance, will be issued to the designated transferee or
transferees.
Prior to the due presentment for registration of transfer of this Note, the
Issuing Entity, the Note Insurer, the Indenture Trustee and any agent of the
Issuing Entity, the Note Insurer or the Indenture Trustee may treat the Person
in whose name this Note is registered as the owner of such Note (i) on the
applicable Record Date for the purpose of making payments and interest of such
Note and (ii) on any other date for all other purposes whatsoever, as the owner
hereof, whether or not this Note be overdue, and neither the Issuing Entity, the
Note Insurer, the Indenture Trustee nor any such agent of the Issuing Entity,
the Note Insurer or the Indenture Trustee 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
Issuing Entity and the rights of the Holders of the Notes under the Indenture at
any time by the Issuing Entity with the consent of the Note Insurer and the
Holders of a majority of all Notes at the time outstanding. The Indenture also
contains provisions permitting the Holders of Notes representing specified
percentages of the aggregate Note Balance of the Notes on behalf of the Holders
of all the Notes, to waive any past Default under the Indenture and its
consequences. Any such waiver by the Holder, at the time of the giving thereof,
of this Note (or any one or more predecessor Notes) shall bind the Holder of
every 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 such Note. The Indenture also permits the Issuing Entity and the Indenture
Trustee to amend or waive
A-1-4
certain terms and conditions set forth in the Indenture without the consent of
the Holders of the Notes issued thereunder.
Initially, this Note will be registered in the name of Cede & Co. as
nominee of DTC, acting in its capacity as the Depository for this Note. This
Note will be delivered by the clearing agency in denominations as provided in
the Indenture and subject to certain limitations therein set forth. This Note is
exchangeable for a like aggregate initial Note Balance of Notes of different
authorized denominations, as requested by the Holder surrendering same.
Unless the Certificate of Authentication hereon has been executed by the
Indenture Trustee by manual signature, this Note shall not be entitled to any
benefit under the Indenture, or be valid or obligatory for any purpose.
AS PROVIDED IN THE INDENTURE, THIS NOTE AND THE INDENTURE CREATING THIS
NOTE SHALL BE CONSTRUED IN ACCORDANCE WITH, AND GOVERNED BY, THE LAWS OF THE
STATE OF NEW YORK APPLICABLE TO AGREEMENTS MADE AND TO BE PERFORMED THEREIN.
A-1-5
IN WITNESS WHEREOF, the Issuing Entity has caused this instrument to be
duly executed by Wilmington Trust Company not in its individual capacity but
solely as Owner Trustee.
Dated: August __, 2006
ORIGEN MANUFACTURED HOUSING CONTRACT
TRUST 2006-A
BY: WILMINGTON TRUST COMPANY not in its
individual capacity but solely in its
capacity as Owner Trustee
By:
------------------------------------
Authorized Signatory
INDENTURE TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Notes referred to in the within-mentioned Indenture.
JPMORGAN CHASE BANK, NATIONAL ASSOCIATION
as Indenture Trustee
By:
---------------------------------
Authorized Signatory
A-1-6
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face of
the Note, shall be construed as though they were written out in full according
to applicable laws or regulations:
TEN COM -- as tenants in common
TEN ENT -- as tenants by the entireties
JT TEN -- as joint tenants with right of survivorship and
not as tenants in common
UNIF GIFT MIN ACT ________ Custodian
___________________________________
(Cust) (Minor)
under Uniform Gifts to Minor Act
____________________________
(State)
Additional abbreviations may also be used though not in the above list.
A-1-7
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto
PLEASE INSERT SOCIAL SECURITY OR OTHER IDENTIFYING NUMBER OF ASSIGNEE:
_________________________________
_________________________________
_________________________________
(Please print or typewrite name and address, including zip code, of assignee)
________________________________________________________________________________
the within Note and all rights thereunder, and hereby irrevocably constitutes
and appoints ________________________ attorney to transfer said Note on the
books kept for registration thereof, with full power of substitution in the
premises.
Dated:
---------------- ---------------------------------------
Signature Guaranteed by
-----------------------------
NOTICE: The signature(s) to this assignment must correspond with the name
as it appears upon the face of the within Note in every particular, without
alteration or enlargement or any change whatsoever. Signature(s) must be
guaranteed by a commercial bank or by a member firm of the New York Stock
Exchange or another national securities exchange. Notarized or witnessed
signatures are not acceptable.
A-1-8
EXHIBIT A-2
FORM OF CLASS A-2 NOTES
UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY
TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE INDENTURE TRUSTEE OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY NOTE ISSUED IS
REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO
SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY
TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON
IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN.
THE HOLDER OF THIS NOTE OR BENEFICIAL OWNER OF ANY INTEREST HEREIN WILL BE
DEEMED TO REPRESENT TO ONE OF THE REPRESENTATIONS CONTAINED IN SECTION 4.15 OF
THE INDENTURE.
THIS NOTE IS A NON-RECOURSE OBLIGATION OF THE ISSUING ENTITY, AND IS LIMITED IN
RIGHT OF PAYMENT TO AMOUNTS AVAILABLE FROM THE TRUST AS PROVIDED IN THE
INDENTURE REFERRED TO BELOW. THE ISSUING ENTITY IS NOT OTHERWISE PERSONALLY
LIABLE FOR PAYMENTS ON THIS NOTE.
PRINCIPAL OF THIS NOTE IS PAYABLE OVER TIME AS SET FORTH HEREIN. ACCORDINGLY,
THE OUTSTANDING NOTE BALANCE OF THIS NOTE AT ANY TIME MAY BE LESS THAN THE
AMOUNT SHOWN ON THE FACE HEREOF.
A-2-1
ORIGEN MANUFACTURED HOUSING CONTRACT TRUST
COLLATERALIZED NOTES, SERIES 2006-A
CLASS A-2
AGGREGATE NOTE BALANCE: NOTE RATE: [___]% (Subject to
$________________ Available Funds Rate)
INITIAL NOTE BALANCE OF THIS BOND: BOND NO. 1
$________________
PERCENTAGE INTEREST: 100% CUSIP NO. [___]
Origen Manufactured Housing Contract Trust 2006-A (the "Issuing Entity"), a
Delaware statutory trust, for value received, hereby promises to pay to Cede &
Co. or registered assigns, the principal sum of ($_____) in monthly installments
on the fifteenth day of each month or, if such day is not a Business Day, the
next succeeding Business Day (each a "Payment Date"), commencing in September
2006 and ending on or before the Payment Date occurring on the Final Stated
Maturity Date and to pay interest on the Note Balance of this Note (this "Note")
outstanding from time to time as provided below.
This Note is one of a duly authorized issue of the Origen Manufactured
Housing Contract Trust Collateralized Notes, Series 2006-A (the "Notes"), issued
under an Indenture dated as of August 1, 2006 (the "Indenture"), between the
Issuing Entity and JPMorgan Chase Bank, National Association, as indenture
trustee (the "Indenture Trustee", which term includes any successor Indenture
Trustee under the Indenture), to which Indenture and all indentures supplemental
thereto reference is hereby made for a statement of the respective rights
thereunder of the Issuing Entity, the Indenture Trustee, the Owner Trustee and
the Holders of the Notes and the terms upon which the Notes are to be
authenticated and delivered. All terms used in this Note which are defined in
the Indenture shall have the meanings assigned to them in the Indenture.
Payments of principal and interest on this Note will be made on each
Payment Date to the Noteholder of record as of the related Record Date. The
"Note Balance" of a Note as of any date of determination is equal to the initial
Note Balance thereof, reduced by the aggregate of all amounts previously paid
with respect to such Note on account of principal on all prior Payment Dates.
The principal of, and interest on, this Note are due and payable as
described in the Indenture, 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 Issuing Entity with respect to this Note
shall be equal to this Note's pro rata share of the aggregate payments on all
Class A-2 Notes as described above, and shall be applied as between interest and
principal as provided in the Indenture.
A-2-2
All principal and interest accrued on the Notes, if not previously paid,
will become finally due and payable at the Final Stated Maturity Date.
The Notes are subject to redemption in whole, but not in part, by the
Servicer on any Payment Date on or after the Payment Date on which the Pool
Principal Balance is less than or equal to 20% of the aggregate Principal
Balance of the Contracts as of Cut-off Date.
The Issuing Entity shall not be liable upon the indebtedness evidenced by
the Notes except to the extent of amounts available from the Trust Estate which
constitute security for the payment of the Notes. The assets included in the
Trust Estate will be the sole source of payments on the Notes, and each Holder
hereof, by its acceptance of this Note, agrees that (i) such Note will be
limited in right of payment to amounts available from the Trust Estate as
provided in the Indenture and (ii) such Holder shall have no recourse to the
Issuing Entity, the Owner Trustee, the Indenture Trustee, the Seller, the
Originator, the Servicer or any of their respective affiliates, or to the assets
of any of the foregoing entities, except the assets of the Issuing Entity
pledged to secure the Notes pursuant to the Indenture and the rights conveyed to
the Issuing Entity under the Indenture.
Any payment of principal or interest payable on this Note shall be paid to
the Person in whose name such Note is registered at the close of business on the
Record Date for such Payment Date by wire transfer to an account in the United
States designated by such Holder, except for the final installment of principal
and interest payable with respect to such Note, which shall be payable as
provided below. Notwithstanding the foregoing, upon written request with
appropriate instructions by the Holder of this Note delivered to the Indenture
Trustee at least five Business Days prior to the Record Date, any payment of
principal or interest, other than the final installment of principal or
interest, shall be made by check mailed to such person's address as it appears
in the Note Register on such Record Date. All reductions in the Note Balance of
a Note (or one or more predecessor Notes) effected by payments of principal made
on any Payment Date shall be binding upon all Holders of this Note and of any
note issued upon the registration of transfer thereof or in exchange therefor or
in lieu thereof, whether or not such payment is noted on such Note. The final
payment of this Note shall be payable upon presentation and surrender thereof on
or after the Payment Date thereof at the Corporate Trust Office or the office or
agency of the Issuing Entity maintained by it for such purpose pursuant to
Section 3.02 of the Indenture.
Subject to the foregoing provisions, each Note delivered under the
Indenture, upon registration of transfer of or in exchange for or in lieu of any
other Note shall carry the right to unpaid principal and interest that were
carried by such other Note.
If an Event of Default as defined in the Indenture shall occur and be
continuing with respect to the Notes, the Notes may become or be declared due
and payable in the manner and with the effect provided in the Indenture. If any
such acceleration of maturity occurs prior to the payment of the entire unpaid
Note Balance of the Notes, the amount payable to the Holder of this Note will be
equal to the sum of the unpaid Note Balance of the Notes, together with accrued
and unpaid interest thereon as described in the Indenture. The Indenture
provides that, notwithstanding the acceleration of the maturity of the Notes,
under certain circumstances specified therein, all amounts collected as proceeds
of the Trust Estate securing the Notes or
A-2-3
otherwise shall continue to be applied to payments of principal of and interest
on the Notes as if they had not been declared due and payable.
The Holder of this Note or Beneficial Owner of any interest herein is
deemed to represent that either (1) it is not acquiring this Note with Plan
Assets or (2) (A) the acquisition, holding and transfer of this Note will not
give rise to a nonexempt prohibited transaction under Section 406 of ERISA or
Section 4975 of the Code and (B) this Note is rated investment grade or better
and such person believes that this Note is properly treated as indebtedness
without substantial equity features for purposes of the DOL Regulations, and
agrees to so treat this Note. Alternatively, regardless of the rating of this
Note, such person may provide the Indenture Trustee and the Owner Trustee with
an opinion of counsel, which opinion of counsel will not be at the expense of
the Issuing Entity, the Seller, the Originator, any Underwriter, the Owner
Trustee, the Indenture Trustee, the Servicer or any successor servicer which
opines that the acquisition, holding and transfer of this Note or interest
herein is permissible under applicable law, will not constitute or result in a
non-exempt prohibited transaction under ERISA or Section 4975 of the Code and
will not subject the Issuing Entity, the Seller, the Originator, the Depositor,
any Underwriter, the Owner Trustee, the Indenture Trustee, the Servicer or any
successor servicer to any obligation in addition to those undertaken in the
Indenture.
As provided in the Indenture and subject to certain limitations therein set
forth, the transfer of this Note may be registered on the Note Register of the
Issuing Entity. Upon surrender for registration of transfer of, or presentation
of a written instrument of transfer for, this Note at the office or agency
designated by the Issuing Entity pursuant to the Indenture, accompanied by
proper instruments of assignment in form satisfactory to the Indenture Trustee,
one or more new Notes of any authorized denominations and of a like aggregate
initial Note Balance, will be issued to the designated transferee or
transferees.
Prior to the due presentment for registration of transfer of this Note, the
Issuing Entity, the Note Insurer, the Indenture Trustee and any agent of the
Issuing Entity, the Note Insurer or the Indenture Trustee may treat the Person
in whose name this Note is registered as the owner of such Note (i) on the
applicable Record Date for the purpose of making payments and interest of such
Note and (ii) on any other date for all other purposes whatsoever, as the owner
hereof, whether or not this Note be overdue, and neither the Issuing Entity, the
Note Insurer, the Indenture Trustee nor any such agent of the Issuing Entity,
the Note Insurer or the Indenture Trustee 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
Issuing Entity and the rights of the Holders of the Notes under the Indenture at
any time by the Issuing Entity with the consent of the Note Insurer and the
Holders of a majority of all Notes at the time outstanding. The Indenture also
contains provisions permitting the Holders of Notes representing specified
percentages of the aggregate Note Balance of the Notes on behalf of the Holders
of all the Notes, to waive any past Default under the Indenture and its
consequences. Any such waiver by the Holder, at the time of the giving thereof,
of this Note (or any one or more predecessor Notes) shall bind the Holder of
every 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 such Note. The Indenture also permits the Issuing Entity and the Indenture
Trustee to amend or waive
A-2-4
certain terms and conditions set forth in the Indenture without the consent of
the Holders of the Notes issued thereunder.
Initially, this Note will be registered in the name of Cede & Co. as
nominee of DTC, acting in its capacity as the Depository for this Note. This
Note will be delivered by the clearing agency in denominations as provided in
the Indenture and subject to certain limitations therein set forth. This Note is
exchangeable for a like aggregate initial Note Balance of Notes of different
authorized denominations, as requested by the Holder surrendering same.
Unless the Certificate of Authentication hereon has been executed by the
Indenture Trustee by manual signature, this Note shall not be entitled to any
benefit under the Indenture, or be valid or obligatory for any purpose.
AS PROVIDED IN THE INDENTURE, THIS NOTE AND THE INDENTURE CREATING THIS
NOTE SHALL BE CONSTRUED IN ACCORDANCE WITH, AND GOVERNED BY, THE LAWS OF THE
STATE OF NEW YORK APPLICABLE TO AGREEMENTS MADE AND TO BE PERFORMED THEREIN.
A-2-5
IN WITNESS WHEREOF, the Issuing Entity has caused this instrument to be
duly executed by Wilmington Trust Company not in its individual capacity but
solely as Owner Trustee.
Dated: August __, 2006
ORIGEN MANUFACTURED HOUSING CONTRACT
TRUST 2006-A
BY: WILMINGTON TRUST COMPANY not in its
individual capacity but solely in its
capacity as Owner Trustee
By:
------------------------------------
Authorized Signatory
INDENTURE TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Notes referred to in the within-mentioned Indenture.
JPMORGAN CHASE BANK, NATIONAL ASSOCIATION
as Indenture Trustee
By:
---------------------------------
Authorized Signatory
A-2-6
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face of
the Note, shall be construed as though they were written out in full according
to applicable laws or regulations:
TEN COM -- as tenants in common
TEN ENT -- as tenants by the entireties
JT TEN -- as joint tenants with right of survivorship and
not as tenants in common
UNIF GIFT MIN ACT _______________ Custodian
__________________________
(Cust) (Minor)
under Uniform Gifts to Minor Act
__________________________
(State)
Additional abbreviations may also be used though not in the above list.
A-2-7
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto
PLEASE INSERT SOCIAL SECURITY OR OTHER IDENTIFYING NUMBER OF ASSIGNEE:
_______________________________________
_______________________________________
_______________________________________
(Please print or typewrite name and address, including zip code, of assignee)
________________________________________________________________________________
the within Note and all rights thereunder, and hereby irrevocably constitutes
and appoints _________ attorney to transfer said Note on the books kept for
registration thereof, with full power of substitution in the premises.
Dated:
-------------------- ----------------------------------------
Signature Guaranteed by
-------------------------------
NOTICE: The signature(s) to this assignment must correspond with the name as it
appears upon the face of the within Note in every particular, without alteration
or enlargement or any change whatsoever. Signature(s) must be guaranteed by a
commercial bank or by a member firm of the New York Stock Exchange or another
national securities exchange. Notarized or witnessed signatures are not
acceptable.
A-2-8
EXHIBIT A-3
RESERVED
A-3-1
EXHIBIT B
LIST OF CONTRACTS
[AVAILABLE UPON REQUEST OF THE INDENTURE TRUSTEE]
B-1
EXHIBIT C
CUSTODIAL AGREEMENT
[SEE ATTACHED EXHIBIT]
C-1
EXHIBIT D
COPY OF THE FINANCIAL GUARANTY INSURANCE POLICY
[SEE ATTACHED EXHIBIT]
E-1
APPENDIX A
DEFINITIONS
"Administrator": Origen Servicing, Inc. in the performance of its duties
pursuant to Article VIII under the Servicing Agreement.
"Affiliate": With respect to any specified Person, any other Person
controlling or controlled by or under common control with such specified Person.
For the purposes of this definition, "control" when used with respect to any
specified Person means the power to direct the management and policies of such
Person, directly or indirectly, whether through the ownership of voting
securities, by contract or otherwise, and the terms "controlling" and
"controlled" have meanings correlative to the foregoing.
"Aggregate Long-Term Extension Trigger Event": The aggregate number of
Contracts that have been the subject of a Long-Term Extension since the Cut-off
Date exceeds 200.
"Aggregate Rate Modification Trigger Event": (a) For any month in which the
Overcollateralization Amount as of the previous Payment Date is greater than or
equal to 85% of the Overcollateralization Target Amount for such Payment Date,
there have been more than (i) 200 Rate Modifications in the five year period
following the Cut-off Date, or (ii) 400 Rate Modifications in the aggregate
since the Cut-off Date.
(b) For any month in which the Overcollateralization Amount as of the
previous Payment Date is less than 85% of the Overcollateralization Target
Amount for such Payment Date, there have been more than (i) 150 Rate
Modifications in the five year period following the Cut-off Date, or (ii) 350
Rate Modifications in the aggregate since the Cut-off Date.
"Amount Available": As to any Payment Date, an amount equal to
(a) the sum of
(i) all payments of interest and principal, including all partial
Principal Prepayments applied and all Principal Prepayments in full and
interest thereon, collected by the Servicer with respect to the Assets
during the related Due Period,
(ii) the Repurchase Price of each Asset which, during the related Due
Period, the Originator purchased under the Asset Purchase Agreement on
account of breaches of the Originator's representations and warranties and
any amounts paid in connection with a substitution of a contract during the
related Due Period,
(iii) all Liquidation Proceeds with respect to each Asset that became
a Liquidated Asset during the related Due Period, plus
(iv) amounts paid to the Issuing Entity by the Swap Provider in
respect of such Payment Date; minus
(b) the sum of:
A-1
(i) amounts permitted to be withdrawn by the Servicer from the
Collection Account pursuant to clauses (c) - (f), inclusive, of Section
3.06 of the Servicing Agreement as of the close of business on the Business
Day preceding such Payment Date;
(ii) amounts payable to the Indenture Trustee and the Administrator to
reimburse it for any tax imposed on the Trust and paid by the Indenture
Trustee or the Administrator, and any expenses incurred in respect of tax
filings, in connection with Section 6.06 of the Indenture and Section
8.01(c) of the Servicing Agreement, respectively; and
(iii) any amounts incorrectly deposited in the Collection Account
during the related Due Period.
"All Hold Rate": Eighty-five percent (85%) of the Applicable LIBOR Rate.
"Amounts Held for Future Distribution": As to any Payment Date, all
payments of interest and principal, including all partial Principal Prepayments
applied and all Principal Prepayments in full and interest thereon, collected by
the Servicer with respect to the Assets during the period commencing on the
first day of the month in which such Payment Date occurs to and including the
second Business Day preceding such Payment Date minus amounts permitted to be
withdrawn by the Servicer from the Collection Account pursuant to clauses (c) -
(f), inclusive, of Section 3.06 of the Servicing Agreement as of the close of
business on the second Business Day preceding such Payment Date with respect to
such amounts collected.
"Applicable LIBOR Rate": For any Payment Date, the rate based on One-Month
LIBOR that is applicable pursuant to the definition of Maximum Auction Rate.
"Asset": A Contract.
"Asset File": With respect to any Contract and Land-and-Home Contract, the
related Contract File and the Land-and-Home Contract File, respectively.
"Assets Net of Securitized Assets": Means the total assets of the Servicer
as determined in accordance with GAAP, consistently applied, on a consolidated
basis, minus all such assets that are Securitized Assets.
"Asset Purchase Agreement": The asset purchase agreement, dated as of
August 1, 2006, among the Seller, the Depositor and the Originator.
"Assignment": An assignment of Mortgage, notice of transfer or equivalent
instrument, in recordable form (excepting therefrom, if applicable, the mortgage
recordation information which has not been required pursuant to the definition
of "Land-and-Home Contract File" or returned by the appropriate recorder's
office), which is sufficient under the laws of the jurisdiction wherein the
related Mortgaged Property is located to reflect of record the sale of the
Mortgage, which assignment, notice of transfer or equivalent instrument may be
in the form of one or more blanket assignments covering Mortgages secured by
Mortgaged Properties located in the same county, if permitted by law.
A-2
"Auction" means the implementation of the Auction Procedures on a Rate
Determination Date.
"Auction Agent" means, with respect to the Auction Rate Securities, the
Initial Auction Agent.
"Auction Agent Agreement" means, with respect to the Auction Rate
Securities, the Initial Auction Agent Agreement.
"Auction Agent Fee" means $1,500 per annum.
"Auction Period" means the period for which the Auction Rate determined on
the immediately preceding Rate Determination Date will apply and which will
initially be the Initial Auction Period and thereafter will begin on the related
Rate Adjustment Date through and ending on, and including, the day immediately
preceding the next succeeding Rate Adjustment Date, as the same may be adjusted.
"Auction Period Adjustment": means the change in the length of an Auction
Period (i) from an Auction Period between seven (7) and ninety-one (91) days,
inclusive, to any other Auction Period between seven (7) and ninety-one (91)
days, inclusive, or (ii) from an Auction Period between ninety-two (92) days and
the final stated maturity date of the Auction Rate Securities, inclusive, to an
Auction Period between ninety-two (92) days and the final stated maturity date
of the Auction Rate Securities, inclusive, if such latter Auction Period is no
more than three (3) months shorter or no more than three (3) months longer than
the Auction Period for the Auction Rate Securities established either at the
initial issuance of the Auction Rate Securities or pursuant to an Auction Period
Conversion, whichever has occurred most recently.
"Auction Period Conversion": means the change in the length of an Auction
Period (i) from an Auction Period between seven (7) and ninety-one (91) days,
inclusive, to an Auction Period between ninety-two (92) days and the final
stated maturity date of the Auction Rate Securities, inclusive, (ii) from an
Auction Period between ninety-two (92) days and the final stated maturity date
of the Auction Rate Securities, inclusive, to an Auction Period between seven
(7) and ninety-one (91) days, inclusive, or (iii) from an Auction Period between
ninety-two (92) days and the final stated maturity date of the Auction Rate
Securities, inclusive, to an Auction Period between ninety-two (92) days and the
final stated maturity date of the Auction Rate Securities, inclusive, if such
latter Auction Period is at least three (3) months shorter or at least three (3)
months longer than the Auction Period for the Auction Rate Securities
established either upon initial issuance of the Auction Rate Securities or
pursuant to an Auction Period Conversion, whichever has occurred most recently.
"Auction Period Conversion Date": means the date on which an Auction Period
Conversion is effective which may occur only on a Rate Adjustment Date.
"Auction Procedures" means the procedures set forth in Appendix B of the
Indenture.
"Auction Rate" means the variable interest rate that results from
implementation of the Auction Procedures.
A-3
"Auction Rate Securities" means the Class A-2 Notes while bearing interest
at the least of (i) an Auction Rate, (ii) the Net Contract Rate, and (iii) the
maximum cap rate of 18.00% per annum.
"Authorized Denomination": means, with respect to the Class A-1 Notes,
$100,000 and integral multiples of $1 in excess thereof and with respect to the
Auction Rate Securities, $25,000 and integral multiples thereof. Following any
Conversion, Authorized Denominations of any converted Class A-2 Notes will be as
set forth in a supplemental indenture relating to the Conversion.
"Authorized Newspaper": A newspaper of general circulation in the Borough
of Manhattan, The City of New York, printed in the English language and
customarily published on each Business Day, whether or not published on
Saturdays, Sundays or holidays.
"Authorized Officer": means, when used with reference to the Depositor, its
president, its secretary, or any other officer authorized in writing by the
board to act on behalf of the Depositor.
"Available Auction Rate Securities" has the meaning set forth in Appendix B
hereto.
"Available Funds Cap Carry-Forward Amount": for either Class of Notes and
any Payment Date on which the Note Rate is the Available Funds Rate or the Net
Contract Rate, will be the sum of (1) the excess, if any, of (a) the amount of
interest accrued thereon for such Payment Date calculated without regard to the
Available Funds Rate or the Net Contract Rate, as applicable, over (b) the
amount of interest accrued thereon at the Available Funds Rate or the Net
Contract Rate, as applicable, for that Payment Date; and (2) any amount
described in clause (1) from prior Payment Dates that remains unpaid; and (3)
interest on the amount in clause (2) at the related Note Rate calculated without
regard to the Available Funds Rate (for the Class A-1 Notes) or the Net Contract
Rate (for the Class A-2 Notes).
"Available Funds Rate": For any Payment Date will be the rate per annum
equal to (i) the weighted average of the Contract Rates (weighted on the basis
of the principal balance of the Contracts as of the first day of the related Due
Period), net of (ii) the Indenture Trustee fee, the servicing fee, the Note
Insurer's premium, amounts payable to the Swap Provider prior to payment of
interest on the Notes, the Broker-Dealer Fee, any Auction Agent Fee and any
Calculation Agent Fee, plus any Net Swap Payments received from the Swap
Provider in respect of such Payment Date, each expressed as a per annum
percentage of the Pool Principal Balance for the immediately preceding Payment
Date, multiplied by a fraction the numerator of which is the Pool Principal
Balance for the immediately preceding Payment Date and the denominator of which
is the sum of the aggregate Note Balance of the Class A Notes as of the day
immediately prior to the current Payment Date.
"Average Sixty-Day Delinquency Ratio": The arithmetic average of the
Sixty-Day Delinquency Ratios for such Payment Date and for the two immediately
preceding Payment Dates.
"Bankruptcy Code": The Bankruptcy Reform Act of 1978 (Title 11 of the
United States Code), as amended.
A-4
"Basic Documents": The Trust Agreement, the Certificate of Trust, the
Indenture, the Servicing Agreement, the Asset Purchase Agreement, the Insurance
Agreement, the Custodial Agreement, the Initial Auction Agent Agreement and the
other documents and certificates delivered in connection with any of the above.
"Beneficial Owner": With respect to any Note, the Person who is the
beneficial owner of such Note as reflected on the books of the Depository or on
the books of a Person maintaining an account with such Depository (directly as a
Depository Participant or indirectly through a Depository Participant, in
accordance with the rules of such Depository).
"Book-Entry Notes": Notes held by a nominee of the Depository, beneficial
interests in which Notes, ownership and transfers of which shall be made through
book entries by the Depository as described in Section 4.06 of the Indenture.
"Broker-Dealer": With respect to the Class A-2 Notes, Citigroup Global
Markets Inc. or any other broker or dealer (each as defined in the Securities
Exchange Act of 1934, as amended), commercial bank or other entity permitted by
law to perform the functions required of a Broker-Dealer set forth in the
Auction Procedures that (a) is an Agent Member (or an affiliate of an Agent
Member), (b) has been appointed as such by the Depositor pursuant to this
Indenture, and (c) has entered into a Broker-Dealer Agreement that is in effect
on the date of reference.
"Business Day": Any day other than a Saturday, a Sunday or a day on which
banking or savings institutions in the State of Delaware, the State of New York,
the State of Michigan, the State of Texas, the Commonwealth of Virginia or in
the city in which the Corporate Trust Office of the Indenture Trustee or the
office of the Note Insurer or the Auction Agent is located are authorized or
obligated by law or executive order to be closed, or any day on which the New
York Stock Exchange is closed.
"Calculation Agent": Citigroup Global Markets Inc.
"Calculation Agent Fee": The fees payable to the Calculation Agent pursuant
to the Initial Auction Agent Agreement.
"Certificate Distribution Account": The account or accounts created and
maintained pursuant to Section 3.10(c) of the Trust Agreement. The Certificate
Distribution Account shall be an Eligible Account.
"Certificate Paying Agent": The meaning specified in Section 3.10 of the
Trust Agreement.
"Certificate Percentage Interest": With respect to each Certificate, the
Percentage Interest stated on the face thereof.
"Certificate Register": The register maintained by the Certificate
Registrar in which the Certificate Registrar shall provide for the registration
of Certificates and of transfers and exchanges of Certificates.
A-5
"Certificate Registrar": Initially, the Indenture Trustee, in its capacity
as Certificate Registrar, or any successor to the Indenture Trustee in such
capacity.
"Certificate of Trust": The Certificate of Trust filed for the Trust
pursuant to Section 3810(a) of the Statutory Trust Statute.
"Certificate" or "Trust Certificate": The Origen Manufactured Housing
Contract Trust Series 2006-A Trust Certificate, evidencing the beneficial
ownership interest in the Issuing Entity and executed by the Trust in
substantially the form set forth in Exhibit A to the Trust Agreement.
"Certificateholder" or "Holder": The Person in whose name a Certificate is
registered in the Certificate Register.
"Charged-off Contract": A Contract with respect to which the Servicer has
written down the outstanding principal balance thereof to zero following
determination made by the Servicer that the circumstances concerning such
Contract and/or valuation of the underlying collateral make the write-off of the
contract balance prudent, with or without the repossession of the underlying
collateral.
"Class": Collectively, all of the Notes bearing the same class designation.
"Class A Notes": Any of the Class A-l or Class A-2 Notes.
"Class A-l Notes": Any one of the Class A-l Notes executed, authenticated
and delivered by the Indenture Trustee, substantially in the form annexed as
Exhibit A-1 to the Indenture.
"Class A-2 Call Price": As defined in Section 8.07(a) of the Indenture.
"Class A-2 Notes": Any one of the Class A-2 Notes executed, authenticated
and delivered by the Indenture Trustee, substantially in the form annexed as
Exhibit A-1 to the Indenture.
"Class A Target Balance": The Pool Principal Balance minus the
Overcollateralization Target Amount for that Payment Date; provided, however,
that, in no event will the Class A Target Balance for any Payment Date be
greater than the Class A Note Balance as of the day immediately preceding such
Payment Date.
"Closing Date": August 25, 2006.
"Code": The Internal Revenue Code of 1986, as amended.
"Collateral": The meaning specified in the Granting Clause of the
Indenture.
"Collection Account": The account or accounts created and maintained, or
caused to be created and maintained, by the Servicer pursuant to Section 3.05(a)
of the Servicing Agreement, which shall be entitled "Origen Servicing, Inc., as
Subservicer for JPMorgan Chase Bank, National Association, as Indenture Trustee,
in trust for the registered holders of Origen
A-6
Manufactured Housing Contract Trust Collateralized Notes, Series 2006-A." The
Collection Account must be an Eligible Account.
"Commission": The Securities and Exchange Commission.
"Computer Tape": The computer tape generated by the Seller which provides
information relating to the Contracts and which was used by the Seller in
selecting the Contracts, and includes the master file and the history file.
"Contract File": As to each Contract, other than a Land-and-Home Contract,
(a) the fully executed original copy of the Contract and security agreement (if
separate), and all modifications thereto, executed by the Obligor evidencing
indebtedness in connection with the purchase of a Manufactured Home, assigned in
blank by the Seller or the Originator (which may be by blanket assignment), (b)
the assignment of the Contract to the Seller or the Originator, (c) the
originals of all assumptions, modifications, consolidation or extension
agreements, if any, signed by the Obligor, with evidence of recording thereon,
if applicable, or copies thereof with a certification that such copy represents
a true and correct copy of the original and that such original has been
submitted for recordation, if applicable, in the appropriate governmental
recording office of the jurisdiction in which the Manufactured Home is located,
(d) either (i) the original title document for the related Manufactured Home or
(ii) a duplicate certified by the appropriate governmental authority which
issued the original thereof or the application for such title document, (e)
evidence of one or more of the following types of perfection of the security
interest in the related Manufactured Home granted by such Contract, as
appropriate: (i) notation of such security interest on the title document, (ii)
an original or copy of the UCC-1 financing statements, certified as true and
correct by the Seller or the Originator and all necessary UCC-3 continuation
statements with evidence of filing thereon or copies thereof certified by the
Seller or the Originator to have been sent for filing, and UCC-3 assignments
executed by the Seller or the Originator in blank, which UCC-3 assignments shall
be in form and substance acceptable for filing, or (iii) such other evidence of
perfection of a security interest in a manufactured housing unit as is
customarily relied upon in the jurisdiction in which the related Manufactured
Home is located, (f) an original notarized Obligor's power of attorney for each
Contract, if any, signed by the Obligor, (g) insurance certificates or other
evidence of the issuance of insurance, (h) the original of any guarantee
executed in connection with the Contract, if any, (i) the loan transfer
agreement, if any, and (j) evidence of any other collateral security, including
with respect to a Land-in-Lieu Contract, the mortgage or deed of trust, if any.
"Contract Rate": With respect to any particular Contract, the rate of
interest specified in that Contract and computed either on a "simple interest"
basis or a precomputed basis, as specified in the related Contract.
"Contracts": The manufactured housing installment sales contracts and
installment loan agreements, including any Land-and-Home Contracts and any
Eligible Substitute Contracts, described in the List of Contracts and
constituting part of the corpus of the Trust, which Contracts are to be assigned
and conveyed by the Seller to the Depositor and by the Depositor to the Trust,
and includes, without limitation, all related security interests and any and all
rights to receive payments which are due pursuant thereto after the applicable
Cut-off Date, but excluding
A-7
any rights to receive payments which are due pursuant thereto on or before the
applicable Cut-off Date.
"Controlling Party": The holder of the majority of the Voting Rights.
"Conversion": The conversion of the Note Rate on any Rate Adjustment Date
from an Auction Rate to a fixed interest rate or a variable interest rate other
than an Auction Rate.
"Conversion Date": The date upon which a Conversion is exercised.
"Converted Rate" means the fixed or variable interest rate on the Class A-2
Notes established upon a Conversion.
"Corporate Trust Office": With respect to the Indenture Trustee,
Certificate Registrar, Certificate Paying Agent and Paying Agent, the principal
corporate trust office of the Indenture Trustee and Note Registrar at which at
any particular time its corporate trust business shall be administered, which
office at the date of the execution of this instrument is located at 4 New York
Plaza, 6th Floor, New York, New York 10004, Attention: Institutional Trust
Services, Origen 2006-A. With respect to the Owner Trustee, the principal
corporate trust office of the Owner Trustee at which at any particular time its
corporate trust business shall be administered, which office at the date of the
execution of this Trust Agreement is located at Wilmington Trust Company, Rodney
Square North, 1100 North Market Street, Wilmington, Delaware 19890-0001,
Attention: Corporate Trust Administration.
"Current Realized Loss Ratio": As to any Payment Date, a fraction,
expressed as a percentage, the numerator of which is the aggregate Realized
Losses for such Payment Date and each of the two immediately preceding Payment
Dates, multiplied by four, and the denominator of which is the arithmetic
average of the Pool Principal Balance as of the third preceding Payment Date and
the Pool Principal Balance as of such Payment Date.
"Custodial Agreement": The agreement for the retention of each Asset File
and other documents, in the form set forth as Exhibit C to the Indenture.
"Custodian": The custodian under the Custodial Agreement, which may be the
Indenture Trustee or any affiliate of the Indenture Trustee, or its successor in
interest or any successor to the Custodian under the Custodial Agreement as
therein provided.
"Custodian Fees": Those fees payable to the Custodian as set forth in
Section 9 of the Custodial Agreement.
"Cut-off Date": The opening of business on August 1, 2006 (or the date of
its substitution, in the case of an Eligible Substitute Contract).
"Cut-off Date Pool Principal Balance": The aggregate of the Cut-off Date
Principal Balances of the Assets.
A-8
"Cut-off Date Principal Balance": As to any Contract, the unpaid principal
balance thereof at the Cut-off Date, after giving effect to all installments of
principal actually received by the Servicer during or prior to the related Due
Period.
"Default": Any occurrence which is or with notice or the lapse of time or
both would become an Event of Default.
"Definitive Notes": The meaning specified in Section 4.06 of the Indenture.
"Depositor": Origen Residential Securities, Inc., a Delaware corporation,
or its successor in interest.
"Depository" or "Depository Agency": The Depository Trust Company or a
successor appointed by the Indenture Trustee. Any successor to the Depository
shall be an organization registered as a "clearing agency" pursuant to Section
17A of the Exchange Act and the regulations of the Securities and Exchange
Commission thereunder.
"Depository Institution": Any depository institution or trust company,
including the Indenture Trustee that (a) is incorporated under the laws of the
United States of America or any State thereof, (b) is subject to supervision and
examination by federal or state banking authorities and (c) has outstanding
unsecured commercial paper or other short-term unsecured debt obligations (or,
in the case of a depository institution that is the principal subsidiary of a
holding company, such holding company has unsecured commercial paper or other
short-term unsecured debt obligations) that are rated at least P-l by Moody's
and A-1+ by S&P.
"Depository Participant": A Person for whom, from time to time, the
Depository effects book-entry transfers and pledges of securities deposited with
the Depository.
"Determination Date": With respect to any Payment Date, the fourth Business
Day before such Payment Date.
"DOL Regulations": Regulations issued by the U.S. Department of Labor at 29
C.F.R. Section 2510.3-101.
"Due Date": With respect to each Contract, the day of the month on which
each scheduled monthly payment is due.
"Due Period": With respect to each Payment Date, the calendar month
preceding the month in which such Payment Date occurs.
"Electronic File": A file in form and substance acceptable to the Indenture
Trustee prepared by the Servicer pursuant to Section 3.04(c) of the Servicing
Agreement with such additions, deletions and modifications as agreed to by the
Indenture Trustee and the Servicer.
"Electronic Ledger": The electronic master record of installment sale
contracts and mortgage loans of the Seller.
A-9
"Eligible Account": Any of (i) an account or accounts maintained with a
Depository Institution, (ii) an account or accounts the deposits in which are
fully insured by the FDIC or (iii) a segregated, non-interest bearing trust
account or accounts maintained with the corporate trust department of a federal
or state chartered depository institution or trust company acting in its
fiduciary capacity. Eligible Accounts may bear interest.
"Eligible Servicer": Origen Financial L.L.C., Origen Servicing, Inc. or any
Person qualified to act as Servicer of the Contracts under applicable federal
and state laws and regulations, which Person services not less than an aggregate
of $50,000,000 in outstanding principal amount of manufactured housing
conditional sales contracts and installment loan agreements.
"Eligible Substitute Contract": As to any Replaced Contract for which such
Eligible Substitute Contract is being substituted pursuant to Section 2.03(b) of
the Servicing Agreement, a Contract that (a) as of the date of its substitution,
satisfies all of the representations and warranties (which, except when
expressly stated to be as of origination, shall be deemed to be determined as of
the date of its substitution rather than as of the Cut-off Date or the Closing
Date) in Section 3.3 of the Asset Purchase Agreement and does not cause any of
the representations and warranties in Section 3.3 of the Asset Purchase
Agreement, after giving effect to such substitution, to be incorrect, (b) after
giving effect to the scheduled payment due in the month of such substitution,
has a Principal Balance that is not greater than the Principal Balance of such
Replaced Contract, (c) has a Contract Rate that is at least equal to the
Contract Rate of such Replaced Contract, (d) has a remaining term to scheduled
maturity that is not greater than the remaining term to scheduled maturity of
the Replaced Contract and (e) is a Land-and-Home Contract if the Replaced
Contract is a Land-and-Home Contract and is otherwise secured by a Manufactured
Home that is similar in type and value to the collateral serving the Replaced
Contract. If more than one Asset is being substituted pursuant to Section 3.7 of
the Asset Purchase Agreement for more than one Replaced Contract on a particular
date, then the conditions specified above shall be applied to the Contracts
being substituted, in the aggregate, and the Replaced Contracts, in the
aggregate.
"ERISA": The Employee Retirement Income Security Act of 1974, as amended.
"Escrow Payment": As defined in Section 3.09 of the Servicing Agreement.
"Estate in Real Property": A fee simple estate in a parcel of land.
"Event of Default": With respect to the Indenture, any one of the following
events (whatever the reason for such Event of Default and whether it shall be
voluntary or involuntary or be effected by operation of law or pursuant to any
judgment, decree or order of any court or any order, rule or regulation of any
administrative or governmental body):
(i) a failure by the Issuing Entity to pay the Interest Payment Amount
on any of the Notes; or
(ii) the failure by the Issuing Entity on the Final Stated Maturity
Date to reduce the Note Balance of any of the Notes to zero and to pay the
entire Interest Payment Amount and any Available Funds Cap Carry-Forward
Amount; or
A-10
(iii) a breach by the Issuing Entity of a negative covenant set forth
in Section 3.16 of the Indenture; or
(iv) there occurs a default in any material respect in the observance
or performance of any covenant or agreement of the Issuing Entity made in
the Indenture, or any representation or warranty of the Issuing Entity made
in the Indenture or in any certificate or other writing delivered pursuant
hereto or in connection herewith proving to have been incorrect in any
material respect as of the time when the same shall have been made, and
such default or breach shall continue or not be cured, or the circumstance
or condition in respect of which such representation or warranty was
incorrect shall not have been eliminated or otherwise cured, for a period
of 30 days after there shall have been given, by registered or certified
mail, to the Issuing Entity by the Indenture Trustee, the Note Insurer or
by the Holders of at least 25% of the aggregate Note Balance of the
Outstanding Notes, a written notice specifying such default or incorrect
representation or warranty and requiring it to be remedied and stating that
such notice is a notice of default hereunder; or
(v) there occurs the filing of a decree or order for relief by a court
having jurisdiction in the premises in respect of the Issuing Entity or any
substantial part of the Trust Estate in an involuntary case under any
applicable federal or state bankruptcy, insolvency or other similar law now
or hereafter in effect, or appointing a receiver, liquidator, assignee,
custodian, trustee, sequestrator or similar official of the Issuing Entity
or for any substantial part of the Trust Estate, or ordering the winding-up
or liquidation of the Issuing Entity's affairs, and such decree or order
shall remain unstayed and in effect for a period of 60 consecutive days; or
(vi) there occurs the commencement by the Issuing Entity of a
voluntary case under any applicable federal or state bankruptcy, insolvency
or other similar law now or hereafter in effect, or the consent by the
Issuing Entity to the entry of an order for relief in an involuntary case
under any such law, or the consent by the Issuing Entity to the appointment
or taking possession by a receiver, liquidator, assignee, custodian,
trustee, sequestrator or similar official of the Issuing Entity or for any
substantial part of the assets of the Trust Estate, or the making by the
Issuing Entity of any general assignment for the benefit of creditors, or
the failure by the Issuing Entity generally to pay its debts as such debts
become due, or the taking of any action by the Issuing Entity in
furtherance of any of the foregoing; or
(vii) any draw on the Policy.
"Exchange Act": The Securities Exchange Act of 1934, as amended, and the
rules and regulations promulgated thereunder.
"Expenses": The meaning specified in Section 7.02 of the Trust Agreement.
"Extension": Any extension of payments due under a Contract by the
Servicer.
A-11
"Fannie Mae": Fannie Mae, formerly known as the Federal National Mortgage
Trustee Association, or any successor thereto.
"FDIC": The Federal Deposit Insurance Corporation or any successor thereto.
"File": An Asset File.
"Final Stated Maturity Date": The Payment Date occurring in November 2018
with respect to the Class A-l Notes and October 2037 with respect to the Class
A-2 Notes.
"Freddie Mac": Freddie Mac, formerly known as the Federal Home Loan
Mortgage Corporation, or any successor thereto.
"Free Writing Prospectus": That certain free writing prospectus dated
August 22, 2006, relating to the public offering of the Notes.
"GAAP": Means generally accepted accounting principles as in effect in the
United States of America from time to time.
"Grant": Pledge, bargain, sell, warrant, alienate, remise, release, convey,
assign, transfer, create, and grant a lien upon and a security interest in and
right of set-off against, deposit, set over and confirm pursuant to the
Indenture. A Grant of the Collateral or of any other agreement or instrument
shall include all rights, powers and options (but none of the obligations) of
the granting party thereunder, including the immediate and continuing right to
claim for, collect, receive and give receipt for principal and interest payments
in respect of such collateral or other agreement or instrument and all other
moneys payable thereunder, to give and receive notices and other communications,
to make waivers or other agreements, to exercise all rights and options, to
bring proceedings in the name of the granting party or otherwise, and generally
to do and receive anything that the granting party is or may be entitled to do
or receive thereunder or with respect thereto.
"Guaranteed Interest Payment": Has the meaning set forth in the Policy.
"Guaranteed Principal Payment Amount": Has the meaning set forth in the
Policy.
"Hazard Insurance Policy": With respect to each Asset, the policy of fire
and extended coverage insurance required to be maintained for the related
Manufactured Home, as provided in Section 3.10 of the Servicing Agreement, and
which, as provided in said Section 3.10 of the Servicing Agreement, may be a
blanket mortgage impairment policy maintained by the Servicer in accordance with
the terms and conditions of said Section 3.10 of the Servicing Agreement.
"Indemnified Party": The meaning specified in Section 7.02 of the Trust
Agreement.
"Indenture": The indenture dated as of August 1, 2006, between the Issuing
Entity and the Indenture Trustee, relating to the Origen Manufactured Housing
Contract Trust Collateralized Notes, Series 2006-A.
A-12
"Indenture Trustee": JPMorgan Chase Bank, National Association, and its
successors and assigns or any successor indenture trustee appointed pursuant to
the terms of the Indenture.
"Indenture Trustee Fee": (a) a $10,000 initial fee, (b) a $15,000 annual
fee, and (c) with respect to each Payment Date, an amount equal to the greater
of (i) one-twelfth of the product of 0.0001 and the aggregate Note Balance for
the immediately preceding Payment Date (or, with respect to the first Payment
Date, the Cut-off Date Pool Principal Balance) and (ii) $1,000.
"Independent": When used with respect to any specified Person, the Person
(i) is in fact independent of the Issuing Entity, any other obligor on the
Notes, the Seller, the Servicer, the Subservicer, the Depositor and any
Affiliate of any of the foregoing Persons, (ii) does not have any direct
financial interest or any material indirect financial interest in the Issuing
Entity, any such other obligor, the Seller, the Servicer, the Subservicer, the
Depositor or any Affiliate of any of the foregoing Persons and (iii) is not
connected with the Issuing Entity, any such other obligor, the Seller, the
Servicer, the Subservicer, the Depositor or any Affiliate of any of the
foregoing Persons as an officer, employee, promoter, underwriter, trustee,
partner, director or person performing similar functions.
"Independent Certificate": A certificate or opinion to be delivered to the
Indenture Trustee under the circumstances described in, and otherwise complying
with, the applicable requirements of Section 10.01 of the Indenture, made by an
independent appraiser or other expert appointed by an Issuing Entity Request,
and such opinion or certificate shall state that the signer has read the
definition of "Independent" in this Indenture and that the signer is Independent
within the meaning thereof.
"Initial Auction Agent": means Computershare Trust Company, Inc., its
successors and assigns.
"Initial Auction Agent Agreement": means the Auction Agency Agreement,
dated as of August 1, 2006, by and among the Issuing Entity, the Indenture
Trustee, the Initial Auction Agent and the Calculation Agent, including any
amendment thereof or supplement thereto, relating to the Auction Rate
Securities.
"Initial Auction Period": means the period commencing on the closing date
through and including September 14, 2006.
"Initial Note Balance": With respect to the Class A-l Notes, $102,596,000.
With respect to the Class A-2 Notes, $98,050,000.
"Insurance Agreement": The Insurance and Indemnity Agreement dated as of
August 25, 2006 by and among the Seller, the Sponsor, the Servicer, the
Subservicer, the Depositor, the Indenture Trustee and the Note Insurer as
amended, modified or supplemented from time to time, in accordance with the
terms thereof.
"Insurance Proceeds": Proceeds paid by any insurer pursuant to any
insurance policy or contract.
"Insured Amount": Has the meaning set forth in the Policy.
A-13
"Insured Payments": Has the meaning set forth in the Policy.
"Interest Accrual Period": For each Class of Notes for the Initial Payment
Date will be the actual number of days from the Closing Date to the day prior to
the Initial Payment Date and for each Payment Date thereafter, the Interest
Accrual Period for each Class of Notes will be the actual number of days from
the previous Payment Date to the day immediately prior to the current Payment
Date.
"Interest Payment Amount": With respect to each Class of Notes, the sum of
(1) interest at the related Note Rate that accrued during the related
Interest Accrual Period on, the related Note Balance,
(2) any unpaid shortfall in interest owed to the notes pursuant to
clause (1) on prior Payment Dates, and
(3) interest on the amount in clause (2) at the related Note Rate
without regard to the Available Funds Rate or the Net Contract Rate.
"Interest Rate Swap Agreement": The Interest Rate Swap Agreement dated as
of August 24, 2006 entered into between the Issuing Entity and the Swap
Provider.
"Investment Company Act": The Investment Company Act of 1940, as amended,
and any amendments thereto.
"IRS": The Internal Revenue Service.
"Issuing Entity": Origen Manufactured Housing Contract Trust 2006-A, a
Delaware statutory trust, or its successor in interest.
"Issuing Entity Request": A written order or request signed in the name of
the Issuing Entity by any one of its Authorized Officers and delivered to the
Indenture Trustee.
"Land-and-Home Contract": A Contract that is secured by a Mortgage on real
estate on which the related Manufactured Home is situated, and which
Manufactured Home is considered or classified as part of the real estate under
the laws of the jurisdiction in which it is located.
"Land-and-Home Contract File": As to each Land-and-Home Contract, (a) the
fully executed original copy of the Land-and-Home Contract and security
agreement (if separate), and all modifications thereto, executed by the Obligor
evidencing indebtedness in connection with the purchase of a Manufactured Home,
assigned in blank by the Seller or the Originator; (b) the original related
Mortgage with evidence of recording thereon (or, if the original Mortgage has
not yet been returned by the applicable recording office, a copy thereof,
certified by such recording office, which will be replaced by the original
Mortgage when it is so returned) and any title policy, commitment or other title
document for the related Manufactured Home; (c) the assignment of the
Land-and-Home Contract and the related Mortgage from the originator to the
Seller or the Originator; (d) an endorsement of such Land-and-Home Contract by
the Seller or the Originator to the Indenture Trustee or in blank; (e) an
assignment of the related Mortgage to
A-14
the Indenture Trustee or in blank; and (f) the originals of all assumptions,
modifications, consolidation or extension agreements, if any, signed by the
Obligor, with evidence of recording thereon, if applicable, or copies thereof
with a certification that such copy represents a true and correct copy of the
original and that such original has been submitted for recordation in the
appropriate governmental recording office of the jurisdiction in which the
Manufactured Home is located.
"Land-in-Lieu Contract": A Contract that is secured by (i) a security
interest in a Manufactured Home and (ii) a mortgage or deed of trust on real
estate on which such Manufactured Home is situated, but such Manufactured Home
is not considered or classified as part of the real estate under the laws of the
jurisdiction in which it is located.
"Liabilities Net of Securitization Liabilities": Means the total
liabilities of the Servicer as determined in accordance with GAAP, consistently
applied, on a consolidated basis, minus all such liabilities representing
obligations to pay collateralized notes or similar obligations secured by or
representing interests in pools of Securitized Assets.
"LIBOR Determination Date": Means, with respect to any Interest Accrual
Period, the second London business day preceding the commencement of that
Interest Accrual Period or Auction Period. For purposes of determining One-Month
LIBOR, a "London business day" is any day on which dealings in deposits of
United States dollars are transacted in the London interbank market.
"Lien": Any mortgage, deed of trust, pledge, conveyance, hypothecation,
assignment, participation, deposit arrangement, encumbrance, lien (statutory or
other), preference, priority right or interest or other security agreement or
preferential arrangement of any kind or nature whatsoever, including, without
limitation, any conditional sale or other title retention agreement, any
financing lease having substantially the same economic effect as any of the
foregoing and the filing of any financing statement under the UCC (other than
any such financing statement filed for informational purposes only) or
comparable law of any jurisdiction to evidence any of the foregoing; provided,
however, that any assignment pursuant to Section 6.03 of the Servicing Agreement
shall not be deemed to constitute a Lien.
"Liquidated Contract": Any defaulted Contract as to which the Servicer has
determined that all amounts which it expects to recover from or on account of
such Contract have been recovered; provided that any defaulted Contract in
respect of which the related Manufactured Home or Mortgaged Property, have been
realized upon and disposed of and the proceeds of such disposition have been
received shall be deemed to be a Liquidated Contract.
"Liquidation Expenses": Out-of-pocket expenses (exclusive of any overhead
expenses) which are incurred by the Servicer in connection with the liquidation
of any defaulted Contract, on or prior to the date on which the related
Manufactured Home and, in the case of Land-and-Home Contracts, Mortgaged
Property, are disposed of, including, without limitation, legal fees and
bankruptcy expenses, and any related and unreimbursed expenditures for property
taxes, property preservation or restoration of the property to marketable
condition.
A-15
"Liquidation Proceeds": Cash (including Insurance Proceeds) received in
connection with the liquidation of defaulted Contracts, whether through
repossession, foreclosure sale or otherwise, including any rental income
realized from the repossessed Manufactured Home.
"List of Contracts": The lists identifying each Contract constituting part
of the corpus of the Trust Estate, and which lists are delivered pursuant to
Section 3.01 of the Trust Agreement, as such lists may be amended from time to
time pursuant to Section 3.7 of the Asset Purchase Agreement to add Eligible
Substitute Assets and delete Replaced Assets. Each List of Contracts shall set
forth as to each Contract identified on it (i) the Cut-off Date Principal
Balance, (ii) the amount of monthly payments due from the Obligor, (iii) the
Contract Rate and (iv) the maturity date.
"Loan-to-Value Ratio": With respect to each Contract including retail
contracts sourced through dealers or brokers, Land-and-Home Contracts sourced
through dealers and correspondents, direct private sales and bulk purchases, a
fraction, the numerator of which is the principal balance of the contract (total
amount financed), and the denominator of which is the sum of the down payment
(the sum of cash, trade-in and land value) plus the principal balance of the
contract (amount financed).
"Long-Term Extension": Any extension of payments due under a Contract by
the Servicer that results in the extension of the final maturity date of such
Contract by more than three months from the original final maturity date for
such Contract.
"Manufactured Home": A unit of manufactured housing, including all
accessions thereto, securing the indebtedness of the Obligor under the related
Contract.
"Maximum Auction Rate": With respect to the Auction Rate Securities (i)
prior to an Auction Period Conversion, either (1) One-Month LIBOR plus 1.50% (if
both of the ratings assigned by Moody's and S&P to the Auction Rate Securities
are "Aa3" and "AA-," respectively, or higher), (2) One-Month LIBOR plus 2.50%
(if any one of the ratings assigned by Moody's and S&P to the Auction Rate
Securities is lower than "Aa3" or "AA-," respectively, but at least "A3" or
"A-," respectively), or (3) One-Month LIBOR plus 3.50% (if any one of the
ratings assigned by Moody's and S&P to the Auction Rate Securities is lower than
"A3" or "A-," respectively) and (ii) after an Auction Period Conversion, the
rate set forth in the supplemental indenture executed in connection with the
Auction Period Conversion. For purposes of the Auction Agent and the Auction
Procedures, the ratings referred to in this definition will be the last ratings
of which the Auction Agent has been given notice pursuant to the Auction Agent
Agreement.
"Monthly Report": Has the meaning assigned in Section 4.01 of the Servicing
Agreement.
"Monthly Servicing Fee": As of any Payment Date, one-twelfth of the product
of 1.25% and the Pool Principal Balance for the immediately preceding Payment
Date (or, with respect to the first Payment Date, the Cut-off Date Pool
Principal Balance).
"Moody's": Moody's Investors Service, Inc. and its successors in interest.
A-16
"Mortgage": The mortgage, deed of trust, security deed or similar evidence
of lien, creating a first lien on an estate in fee simple in the real property
securing a Land-and-Home Contract or Mortgage Loan.
"Mortgaged Property": The property subject to the lien of a Mortgage.
"Mortgagor": The obligor on a Mortgage Note.
"Net Contract Rate": means, for any Payment Date, (i) the weighted average
of the contract rates (weighted on the basis of the principal balance of the
contracts as of the first day of the related due period) minus (ii) the
servicing fee, indenture trustee fee, Auction Agent Fee, Broker-Dealer Fee,
Calculation Agent Fee, Note Insurer's premium and Net Swap Payment payable to
the Swap Provider plus any Net Swap Payments payable to the Issuing Entity in
respect of such Payment Date, each expressed as a per annum percentage of the
Pool Principal Balance for the immediately preceding Payment Date, multiplied by
a fraction the numerator of which is the Pool Principal Balance for the
immediately preceding Payment Date and the denominator of which is the sum of
the aggregate note balance of the Class A Notes as of the day immediately prior
to that Payment Date.
"Net Liquidation Loss": As to a Liquidated Contract, the amount, if any, by
which (a) the outstanding principal balance of such Liquidated Contract plus
accrued and unpaid interest thereon to the date on which such Liquidated
Contract became a Liquidated Contract exceeds (b) the sum of (1) the Net
Liquidation Proceeds for such Liquidated Contract plus (2) the principal balance
of any new Contract originated to the purchaser of the related repossessed
Manufactured Home, to the extent such new Contract qualifies as an Eligible
Substitute Contract and is added to the Trust Estate.
"Net Liquidation Proceeds": As to a Liquidated Contract, all Liquidation
Proceeds received on or prior to the last day of the month in which such
Contract became a Liquidated Contract, net of Liquidation Expenses.
"Net Swap Payment": has the meaning set forth in the Interest Rate Swap
Agreement.
"Net Worth": Means the amount by which the book value of the Servicer's
assets exceed the Servicer's liabilities, as determined in accordance with GAAP,
consistently applied.
"Non-Payment Rate": means One-Month LIBOR plus 1.50% per annum.
"Nonrecoverable Advance": Any Servicing Advances which are not recovered,
or which the Servicer reasonably believes will not be recovered, by the Servicer
from late collections from the Obligor of the item advanced, or from Liquidation
Proceeds on the related Contract, and any Servicing Advances incurred by the
Servicer in connection with a delinquent or defaulted Contract which is
subsequently reinstated, worked out, or otherwise cured. In determining whether
a Servicing Advance is or will be nonrecoverable, the Servicer need not take
into account that it might receive any amounts in a deficiency judgment. The
determination by the Servicer that any Servicing Advance is, or if made would
constitute, a Nonrecoverable Advance, shall be evidenced by a certificate of a
Servicing Officer of the Servicer delivered to the Indenture Trustee stating the
reasons for such determination.
A-17
"Note": Any one of the Origen Manufactured Housing Contract Trust
Collateralized Notes, Series 2006-A, Class A-1 and Class A-2 issued under the
Indenture.
"Note Balance": As of any Payment Date, for any Class of Notes, the Initial
Note Balance of that Class less all amounts previously paid to Holders of that
Class on account of principal.
"Note Insurer": Ambac Assurance Corporation and its successors and assigns.
"Note Insurer Default": A failure by the Note Insurer to make a required
payment under the Policy in accordance with the terms thereof.
"Note Owner": The Beneficial Owner of a Note.
"Note Payment Account": The trust account or accounts created and
maintained by the Indenture Trustee pursuant to Section 3.01 of the Indenture,
which shall be entitled "JPMorgan Chase Bank, National Association, as Indenture
Trustee, in trust for the registered holders of Origen Manufactured Housing
Contract Trust Collateralized Notes, Series 2006-A and Ambac Assurance
Corporation." The Note Payment Account must be an Eligible Account.
The "Note Rate" for (i) the Class A-1 Notes will be the least of (A)
One-Month LIBOR plus 0.15% per annum, (B) the Available Funds Rate and (C) the
maximum cap rate of 18.00% per annum and (ii) the Class A-2 Notes will be the
least of (A) the applicable Auction Rate or, if a Conversion has occurred, the
applicable Converted Rate, (B) the Net Contract Rate and (C) the maximum cap
rate of 18.00% per annum.
"Note Register": The register maintained by the Note Registrar in which the
Note Registrar shall provide for the registration of Notes and of transfers and
exchanges of Notes.
"Note Registrar": The Indenture Trustee, in its capacity as Note Registrar,
or any successor to the Indenture Trustee in such capacity.
"Noteholder" or "Holder": The Person in whose name a Note is registered in
the Note Register, except that, any Note registered in the name of the
Depositor, the Issuing Entity, the Indenture Trustee, the Seller or the Servicer
or any Affiliate of any of them shall be deemed not to be a holder or holders,
nor shall any so owned be considered outstanding, for purposes of giving any
request, demand, authorization, direction, notice, consent or waiver under the
Indenture or the Trust Agreement; provided that, in determining whether the
Indenture Trustee shall be protected in relying upon any such request, demand,
authorization, direction, notice, consent or waiver, only Notes that a
Responsible Officer of the Indenture Trustee or the Owner Trustee actually knows
to be so owned shall be so disregarded. Owners of Notes that have been pledged
in good faith may be regarded as Holders if the pledgee establishes to the
satisfaction of the Indenture Trustee or the Owner Trustee the pledgee's right
so to act with respect to such Notes and that the pledgee is not the Issuing
Entity, any other obligor upon the Notes or any Affiliate of any of the
foregoing Persons.
"Obligor": Each Person who is indebted under a Contract.
A-18
"Officer's Certificate": With respect to the Servicer, a certificate signed
by the President, Managing Director, a Director, a Vice President or an
Assistant Vice President, of the Servicer and delivered to the Indenture
Trustee. With respect to the Issuing Entity, a certificate signed by any
Authorized Officer of the Issuing Entity, under the circumstances described in,
and otherwise complying with, the applicable requirements of Section 10.01 of
the Indenture, and delivered to the Indenture Trustee. Unless otherwise
specified, any reference in the Indenture to an Officer's Certificate shall be
to an Officer's Certificate of any Authorized Officer of the Issuing Entity.
"One-Month LIBOR": The London interbank offered rate for one-month United
States dollar deposits determined by the Indenture Trustee on the basis of (1)
the offered rates (rounded up to the next highest one one-thousandth of one
percent (0.001%)) deposits in U.S. dollars for a one-month period, as such rates
appear on Telerate Page 3750, at approximately 11:00 a.m. (London time) on such
LIBOR Determination Date or (2) if such rate does not appear on Telerate Page
3750 at approximately 11:00 a.m. (London time), the Indenture Trustee will
determine such rate on the basis of the offered rates of the Reference Banks for
one-month United States dollar deposits, as such rates appear on the Reuters
Screen LIBO Page, as of 11:00 a.m. (London time) on such LIBOR Determination
Date.
"Opinion of Counsel": A written opinion of counsel acceptable to the
Indenture Trustee and the Note Insurer, in its reasonable discretion, which
counsel may be in-house counsel for the Servicer if acceptable to the Indenture
Trustee, the Note Insurer and to the Rating Agencies (if applicable).
"Originator": Origen Financial L.L.C., or its successor in interest, in its
capacity as originator of the Contracts.
"Origen REIT": Origen Financial, Inc., a Delaware corporation.
"Outstanding": With respect to the Notes, as of the date of determination,
all Notes theretofore executed, authenticated and delivered under this Indenture
except:
(i) Notes theretofore canceled by the Note Registrar or delivered to
the Indenture Trustee for cancellation; and
(ii) Notes in exchange for or in lieu of which other Notes have been
executed, authenticated and delivered pursuant to the Indenture unless
proof satisfactory to the Indenture Trustee is presented that any such
Notes are held by a holder in due course.
provided, however, that Class A Notes which have been paid with
proceeds of the Policy will continue to remain outstanding for purposes of
this Indenture until the Note Insurer has been paid as a subrogee hereunder
or reimbursed pursuant to the Insurance Agreement as evidenced by a written
notice from the Note Insurer deemed to be the Indenture Trustee, and the
Note Insurer will be deemed to be the Holder thereof to the extent of any
payments made thereon by the Note Insurer.
A-19
"Outstanding Advance Amounts": As to any Payment Date, all servicing
advances less the aggregate of all amounts actually received by the Servicer
prior to such Payment Date in reimbursement for any such advances.
"Overcollateralization Amount": With respect to any Payment Date, the
excess, if any, of the Pool Principal Balance for such Payment Date over the
aggregate Note Balance of the Class A Notes.
"Overcollateralization Target Amount": (i) For each Payment Date prior to
September 1, 2010, 11.00% of the Pool Principal Balance as of the Cut-off Date,
(ii) for each Payment Date on or after September 1, 2010, provided a Trigger
Event is not in effect, the lesser of (x) 11.00% of the Pool Principal Balance
as of the Cut-off Date and (y) the greater of (1) 19.25% of the Pool Principal
Balance for that Payment Date and (2) approximately $10,648,816 and (iii) for
each Payment Date on or after September 1, 2010, and on which a Trigger Event is
in effect, the Overcollateralization Target Amount for the immediately preceding
Payment Date. Notwithstanding the foregoing, on any Payment Date on which the
Pool Principal Balance is less than or equal to 20% of the Pool Principal
Balance as of the Cut-off Date, the Overcollateralization Target Amount will
equal 100% of the then-current Pool Principal Balance.
"Owner Trust Estate": The corpus of the Issuing Entity created by the Trust
Agreement which consists of items referred to in Section 3.01 of the Trust
Agreement.
"Owner Trustee": Wilmington Trust Company, acting not in its individual
capacity but solely as Owner Trustee, and its successors and assigns or any
successor owner trustee appointed pursuant to the terms of the Trust Agreement.
"Owner Trustee Fee": An initial payment of $4,000 and an annual payment of
$4,000 thereafter.
"Paying Agent": Any paying agent or co-paying agent appointed pursuant to
Section 3.03 of the Indenture, which initially shall be the Indenture Trustee.
"PCAOB": The Public Company Accounting Oversight Board.
"Payment Date": The 15th day of any month, or if such 15th day is not a
Business Day, the Business Day immediately following such 15th day, commencing
in September 2006.
"Percentage Interest": With respect to any Note, the percentage obtained by
dividing the Note Balance of such Note by the aggregate Note Balances of all
Notes of that Class. With respect to any Certificate, the percentage as stated
on the face thereof.
"Permitted Investments": Any one or more of the following obligations or
securities acquired at a purchase price of not greater than par, regardless of
whether issued by the Depositor, the Servicer, the Indenture Trustee or any of
their respective Affiliates:
(i) direct obligations of, or obligations fully guaranteed as to
timely payment of principal and interest by, the United States or any
agency or instrumentality thereof, provided such obligations are backed by
the full faith and credit of the United States;
A-20
(ii) demand and time deposits in, certificates of deposit of, or
bankers' acceptances issued by, any Depository Institution;
(iii) repurchase obligations with respect to any security described in
clause (i) above entered into with a Depository Institution (acting as
principal);
(iv) securities bearing interest or sold at a discount that are issued
by any corporation incorporated under the laws of the United States of
America or any state thereof and that are rated by each Rating Agency that
rates such securities in its highest long-term unsecured rating categories
at the time of such investment or contractual commitment providing for such
investment;
(v) commercial paper (including both non-interest-bearing discount
obligations and interest-bearing obligations payable on demand or on a
specified date not more than 30 days after the date of acquisition thereof)
that is rated by each Rating Agency that rates such securities in its
highest short-term unsecured debt rating available at the time of such
investment;
(vi) units of money market funds that have been rated "AAAm" or
"AAAm-G" by S&P (including those managed or advised by the Indenture
Trustee or its respective affiliates) and for which JPMorgan Chase Bank,
National Association or an affiliate thereof serves as an investment
advisor, administrator, shareholder servicing agent and/or custodian or
subcustodian, notwithstanding that (i) JPMorgan Chase Bank, National
Association or an affiliate thereof charges and collects fees and expenses
from such funds for services rendered, (ii) JPMorgan Chase Bank, National
Association or an affiliate thereof charges and collects fees and expenses
for services rendered pursuant to this Agreement, and (iii) services
performed for such funds and pursuant to this Agreement may converge at any
time. JPMorgan Chase Bank, National Association or an affiliate thereof is
specifically authorized to charge and collect from the account, moneys on
deposit which were invested in such funds, such fees as are collected from
all investors in such funds for services rendered to such funds (but not to
exceed investment earnings on the Trust's moneys so invested); and
(vii) if previously confirmed in writing to the Indenture Trustee, any
other demand, money market or time deposit, or any other obligation,
security or investment, as may be acceptable to the Rating Agencies as a
permitted investment of funds backing securities having ratings equivalent
to its highest initial rating of the Class A Notes;
provided, however, that no instrument described hereunder shall evidence either
the right to receive (a) only interest with respect to the obligations
underlying such instrument or (b) both principal and interest payments derived
from obligations underlying such instrument and the interest and principal
payments with respect to such instrument provide a yield to maturity at par
greater than 120% of the yield to maturity at par of the underlying obligations.
"Person": Any individual, corporation, partnership, joint venture,
association, joint-stock company, trust, unincorporated organization or
government or any agency or political subdivision thereof.
A-21
"Plan": Any employee benefit plan or certain other retirement plans and
arrangements, including individual retirement accounts and annuities, Keogh
plans and bank collective investment funds and insurance company general or
separate accounts in which such plans, accounts or arrangements are invested,
that are subject to ERISA or Section 4975 of the Code.
"Plan Assets": Assets of a Plan within the meaning of Department of Labor
regulation 29C.F.R. Section 2510.3-101.
"Policy": The financial guaranty insurance policy (No. AB1015BE) together
with all endorsements thereto issued by the Note Insurer to the Indenture
Trustee for the benefit of the Holders of the Notes.
"Pool Principal Balance": As of any Payment Date, the aggregate Principal
Balance of all Contracts outstanding at the end of the related Due Period.
"Premium Letter": The letter agreement between the Indenture Trustee and
the Note Insurer dated August 25, 2006 setting forth the premium with respect to
the Policy and the expenses of the Note Insurer.
"Prepayment Assumption": As set forth in the Prospectus Supplement.
"Prepayment Period": With respect to any Payment Date, the calendar month
preceding the calendar month in which such Payment Date occurs.
"Principal Balance": As to any Contract and any Payment Date, the Cut-off
Date Principal Balance, minus all collections credited against the Principal
Balance of such Contract prior to the last day of the related Due Period. For
purposes of this definition, a Liquidated Contract shall be deemed to have a
Principal Balance equal to the Principal Balance of the related Contract
immediately prior to the final recovery of related Liquidation Proceeds and a
Principal Balance of zero thereafter.
"Principal Payment Amount": For any Payment Date will equal the Note
Balance as of the day immediately preceding that Payment Date less the Class A
Target Balance for that Payment Date.
"Principal Prepayment": Any payment of principal made by the Obligor on a
Contract which is received in advance of its scheduled Due Date and which is not
accompanied by an amount of interest representing the full amount of scheduled
interest due on any Due Date in any month or months subsequent to the month of
prepayment; provided that such a payment in an amount less than the next
scheduled monthly payment may be held by the Servicer and applied to the next
monthly payment due on the next due date under the related Contract.
"Proceeding": Any suit in equity, action at law or other judicial or
administrative proceeding.
"Prospectus Supplement": That certain Prospectus Supplement dated August
23, 2006, relating to the public offering of the Notes.
A-22
"Purchaser Information": The information in the Prospectus and the
information relating to the Underwriter in the Prospectus Supplement under the
caption "Method of Distribution" and any Derived Information. The term "Derived
Information" means such information, if any, in the Term Sheet that is not
contained in either (i) the Prospectus, the Preliminary Prospectus Supplement or
Prospectus Supplement, taking into account information incorporated therein by
reference or (ii) any Pool Information, except to the extent that any Derived
Information results from a Pool Error. "Pool Information" is information
concerning the characteristics of the Contracts furnished to the Underwriter by
the Originator, the Seller or the Servicer for use in the preparation of the
Term Sheet. "Pool Error" is uncorrected Pool Information.
"Rating Agency" or "Rating Agencies": Moody's and Standard & Poor's or
their successors. If such agencies or their successors are no longer in
existence, "Rating Agencies" shall be such nationally recognized statistical
rating agencies, or other comparable Persons, designated by the Depositor,
notice of which designation shall be given to the Indenture Trustee and the
Servicer.
"Realized Losses": As to any Payment Date, the aggregate Net Liquidation
Losses of all Contracts that became Liquidated Contracts during the immediately
preceding month.
"Record Date": With respect to each Payment Date and any Book-Entry Note,
the Business Day immediately preceding such Payment Date. With respect to each
Payment Date and any other Notes, including any Definitive Notes, the last
Business Day of the month immediately preceding the month in which such Payment
Date occurs.
"Redemption Price": As defined in Section 8.07 of the Indenture.
"Registered Holder": The Person in whose name a Note is registered in the
Note Register on the applicable Record Date.
"Regulation AB": Subpart 229.1100 - Asset Backed Securities (Regulation
AB), 17 C.F.R. Sections 229.1100 - 229.1123, as such may be amended from time to
time, and subject to such clarification and interpretation as have been provided
by the Commission in the adopting release (Asset-Backed Securities, Securities
Act Release No. 33-8518, 70 Fed. Reg. 1,506, 1,531 (Jan. 7, 2005)) or by the
staff of the Commission, or as may be provided by the Commission or its staff
from time to time.
"Related Documents": With respect to each Contract, the documents specified
in the definition of "Contract File" and "Land-and-Home Contract File," as
applicable, and any documents required to be added to such documents pursuant to
the Asset Purchase Agreement, the Trust Agreement, Indenture or the Servicing
Agreement.
"Relief Act": The Servicemembers Civil Relief Act, formerly known as the
Soldiers' and Sailors' Civil Relief Act of 1940, as amended.
"Replaced Contract": Has the meaning assigned in Section 2.03 of the
Indenture.
"Repurchase Price": With respect to a Contract to be repurchased pursuant
to Section 2.03 of the Servicing Agreement, an amount equal to (a) the remaining
principal amount
A-23
outstanding on such Contract, plus (b) interest at the Contract Rate on such
Contract from the end of the Due Period with respect to which the Obligor last
made a payment through the end of the immediately preceding Due Period.
"Required Principal Payment Amount": For any Payment Date will be the
amount by which (i) the sum of the Note Balances of the Class A Notes, exceeds
(ii) the Pool Principal Balance as of such Payment Date minus the
Overcollateralization Target Amount for such Payment Date.
"Responsible Officer": When used with respect to the Indenture Trustee or
the Owner Trustee, any vice president, managing director, director, any
assistant vice president, the Secretary, any assistant secretary, the Treasurer,
any assistant treasurer, any associate, any trust officer or assistant trust
officer or any other officer of the Trustee having direct responsibility over
this Agreement, with respect to a particular matter, to whom such matter is
referred because of such officer's knowledge of and familiarity with the
particular subject.
"Rolling Average Extension Percentage": For any month, the percentage
obtained by dividing (1) the sum of the following amount for each of the six
most recently ended months: the unpaid principal balance of Contracts that were
subject to Extensions (not including Extensions in response to natural
disasters) during such month expressed as a percentage of the Pool Principal
Balance in respect of the Payment Date in such month, divided by (2) six,
exceeds 1.00%.
"Rolling Average Extension Trigger Event": (a) For any month in which the
Overcollateralization Amount as of the previous Payment Date is greater than or
equal to 85% of the Overcollateralization Target Amount for such Payment Date,
the Rolling Average Extension Percentage exceeds 1.00%.
(b) For any month in which the Overcollateralization Amount as of the
previous Payment Date is less than 85% of the Overcollateralization Target
Amount for such Payment Date, the Rolling Average Extension percentage exceeds
0.75%.
"Scheduled Payment": As to any Due Period and each Contract, the scheduled
monthly payment of principal and/or interest required to be made by an Obligor
on the related Contract.
"Securities Act": The Securities Act of 1933, as amended, and the rules and
regulations promulgated thereunder.
"Securitized Assets": Means manufactured housing installment sales
contracts, manufactured housing installment loan agreements, mortgage loans and
other similar assets included in the Servicer's assets on a consolidated basis
in accordance with GAAP, consistently applied, which have been transferred or
pledged to one or more special purpose entities to collateralize or to provide
the source of payments on asset-backed securities, whether denominated as notes
or pass-through certificates.
"Seller": Origen Securitization Company, LLC, and its successors and
assigns, in its capacity as seller under the Asset Purchase Agreement.
A-24
"Seller Information": The information in the Term Sheet, the Free Writing
Prospectus and Prospectus Supplement other than the Purchaser Information.
"Service Transfer": As defined in Section 6.02 of the Servicing Agreement.
"Servicer": Origen Financial L.L.C., or any successor servicer appointed as
provided in the Servicing Agreement, in its capacity as Servicer under the
Servicing Agreement.
"Servicer Event of Default": One or more of the events described in Section
6.01 of the Servicing Agreement.
"Servicer Remittance Date": With respect to any Payment Date, by 1:00 p.m.
New York time two Business Days preceding such Payment Date.
"Servicing Account": The account or accounts created and maintained
pursuant to Section 3.09 of the Servicing Agreement.
"Servicing Advance": Any Liquidation Expense incurred by the Servicer
pursuant to Section 3.09 or 3.11 of the Servicing Agreement, and any advance
made by the Servicer pursuant to Sections 3.06(f), 3.10 or 3.14 of the Servicing
Agreement.
"Servicing Agreement": The Servicing Agreement dated as of August 1, 2006,
among the Servicer, the Depositor, the Subservicer, the Originator, the Issuing
Entity and the Indenture Trustee.
"Servicing Criteria": The criteria set forth in paragraph (d) of Item 1122
of Regulation AB, as such may be amended from time to time, as set forth on
Exhibit E to the Servicing Agreement.
"Servicing Fee": With respect to each Contract and for any calendar month,
an amount equal to the Servicing Fee Rate accrued for one month (or in the event
of any payment of interest which accompanies a Principal Prepayment in full or
in part made by the Obligor during such calendar month, interest for the number
of days covered by such payment of interest) on the same principal amount on
which interest on such Contract accrues for such calendar month, calculated on
the basis of a 360-day year consisting of twelve 30-day months. A portion of
such Servicing Fee may be retained by any Subservicer as its servicing
compensation.
"Servicing Fee Rate": 1.25% per annum.
"Servicing Officer": Any officer of the Servicer or the Subservicer
involved in, or responsible for, the administration and servicing of Contracts
whose name appears on a list of servicing officers appearing in an Officer's
Certificate furnished to the Indenture Trustee by the Servicer or the
Subservicer, as the same may be amended from time to time.
"Sixty-Day Delinquency Ratio": As to any Payment Date, a fraction,
expressed as a percentage, the numerator of which is the aggregate of the
outstanding balances of all Contracts that were delinquent 60 days or more as of
the end of the related Due Period (including Contracts
A-25
in respect of which the related Manufactured Homes have been repossessed but are
still in inventory), and the denominator of which is the Pool Principal Balance
as of such Payment Date.
"Sponsor": Origen Financial L.L.C., a Delaware limited liability company
and a wholly owned subsidiary of Origen Financial, Inc.
"Standard & Poor's" or "S&P": Standard & Poor's, a division of The
McGraw-Hill Companies, Inc., and its successors in interest.
"Statutory Trust Statute": Chapter 38 of Title 12 of the Delaware Code, 12
Del. Code Sections 3801 et seq., as the same may be amended from time to time.
"Subservicer": Any Person with which the Servicer has entered into a
Subservicing Agreement and which meets the qualifications of a Subservicer
pursuant to Section 3.02 of the Servicing Agreement.
"Subservicing Agreement": The written contract between the Servicer and a
Subservicer relating to servicing and administration of certain Assets pursuant
to Section 3.12 of the Servicing Agreement.
"Swap Event of Default": (i) The failure to make a payment due under the
Interest Rate Swap Agreement after notice of such failure is received and
expiration of a specified grace period, (ii) certain insolvency or bankruptcy
events, and (iii) a merger by the Swap Provider without an assumption of its
obligations under the Interest Rate Swap Agreement, each as further described in
the Interest Rate Swap Agreement.
"Swap Provider": Citibank, N.A. and its successors and assigns.
"Swap Provider Trigger Event": has the meaning set forth in Interest Rate
Swap Agreement.
"Swap Termination Payment": has the meaning set forth in Interest Rate Swap
Agreement.
"Term Sheet": That certain term sheet dated [August 21, 2006,] distributed
to investors in connection with the offering of the Notes.
"Title of Series": Origen Manufactured Housing Contract Trust
Collateralized Notes, Series 2006-A.
"Trigger Event": is in effect with respect to any Payment Date if:
(a) the Average Sixty-Day Delinquency Ratio Test as of the
Payment Date exceeds 7.25%;
(b) the aggregate amount of Realized Losses incurred since the
Cut-Off Date and as of the Payment Date exceed the following
percentages of the aggregate Principal Balance of the Contracts as of
the Cut-off Date: Payment
A-26
Dates commencing September 2010 to and including March 2012, 7.50%,
Payment Dates commencing April 2012 to and including March 2013,
9.50%, Payment Dates commencing April 2013 to and including March
2014, 12.00% and each Payment Date thereafter, 14.25%;
(c) the Current Realized Loss Ratio as of the Payment Date
exceeds 4.00%.
"Trust": The Origen Manufactured Housing Contract Trust 2006-A created
pursuant to the Trust Agreement.
"Trust Agreement": The Trust Agreement, dated August 1, 2006, among the
Owner Trustee, the Depositor and JPMorgan Chase Bank, National Association, as
Certificate Registrar and Certificate Paying Agent, relating to the Trust.
"Trust Estate": As defined in the Granting Clause of the Indenture.
"Trust Indenture Act" or "TIA": The Trust Indenture Act of 1939, as amended
from time to time, as in effect on any relevant date.
"UCC": The Uniform Commercial Code, as amended from time to time, as in
effect in any specified jurisdiction.
"Underwriter": Citigroup Global Markets Inc., or its successors.
"Voting Rights": The votes allocated among the Holders of the Notes in
proportion to the then Outstanding Note Balances of their respective Notes;
provided that, so long as no Note Insurer Default has occurred and is
continuing, 100% of the Voting Rights shall be held by the Note Insurer.
A-27
APPENDIX B
AUCTION PROCEDURES
I. Auction Participants.
A. Existing Holders and Potential Holders. Participants in each Auction
will include: (i) "Existing Holders," which will mean, for purposes of dealing
with the Auction Agent in connection with an Auction, a Person who is a
Broker-Dealer listed in the Existing Holder registry at the close of business on
the Business Day preceding such Auction, and, for purposes of dealing with the
Broker-Dealer in connection with an Auction, a Person who is a Beneficial Owner
of Auction Rate Securities and (ii) "Potential Holders," which will mean any
Person (including an Existing Holder) that is a Broker-Dealer for purposes of
dealing with the Auction Agent, and a potential Beneficial Owner for purposes of
dealing with a Broker-Dealer, who may be interested in acquiring Auction Rate
Securities.
By purchasing the Auction Rate Securities, whether in an Auction or
otherwise, each prospective purchaser of the Auction Rate Securities or its
Broker-Dealer must agree and will be deemed to have agreed: (i) to participate
in Auctions on the terms described herein; (ii) so long as the Beneficial
Ownership of the Auction Rate Securities is maintained in book-entry form, to
sell, transfer or otherwise dispose of Auction Rate Securities, only pursuant to
a Bid (as defined below) or a Sell Order (as defined below) in an Auction, or to
or through a Broker-Dealer, provided that in the case of all transfers other
than those pursuant to an Auction, the Existing Holder of Auction Rate
Securities so transferred, its Participant or Broker-Dealer advises the Auction
Agent of such transfer; (iii) to have its Beneficial Ownership of Auction Rate
Securities maintained at all times in book-entry form for the account of its
Participant, which in turn will maintain records of such Beneficial Ownership,
and to authorize such Participant to disclose to the Auction Agent such
information with respect to such Beneficial Ownership as the Auction Agent may
request; (iv) that a Sell Order placed by an Existing Holder will constitute an
irrevocable offer to sell the principal amount of Auction Rate Securities
specified in such Sell Order; (v) that a Bid placed by an Existing Holder will
constitute an irrevocable offer to sell the principal amount of Auction Rate
Securities specified in such Bid if the rate specified in such Bid is greater
than, or in some cases equal to, the Auction Rate, determined as described in
this Appendix B; (vi) that a Bid placed by a Potential Holder will constitute an
irrevocable offer to purchase the principal amount, or a lesser principal
amount, of the Auction Rate Securities specified in such Bid if the rate
specified in such Bid is, respectively, less than or equal to the Auction Rate,
determined as described in this Appendix B; and (vii) to tender its Auction Rate
Securities for purchase at 100% of the principal amount thereof, plus accrued
but unpaid interest, and interest accrued thereon, on a Conversion Date or an
Auction Period Conversion Date, as applicable.
The principal amount of the Auction Rate Securities purchased or sold may
be subject to proration procedures on the Rate Determination Date. Each purchase
or sale of the Auction Rate Securities on the Rate Determination Date will be
made for settlement on the first day of the Auction Period immediately following
such Rate Determination Date at a price equal to 100% of the principal amount
thereof plus accrued interest, if any. The Auction Agent is entitled to rely
upon the terms of any Order submitted to it by a Broker-Dealer.
B-1
B. Auction Agent. Pursuant to Section 6.14(iv) of this Indenture,
Computershare Trust Company, Inc. has been appointed the Initial Auction Agent
to serve as agent for the Issuing Entity in connection with Auctions. Any
Substitute Auction Agent will be (i) a bank or trust company duly organized
under the laws of the United States of America or any state or territory thereof
having its principal place of business in the Borough of Manhattan, New York, or
such other location as approved by the Indenture Trustee (at the direction of
the Depositor) and the Calculation Agent in writing and having a combined
capital stock or surplus of at least $50,000,000, or (ii) a member of the
National Association of Securities Dealers, Inc. having a capitalization of at
least $50,000,000, and, in either case, authorized by law to perform all the
duties imposed upon it under the Indenture and under the Auction Agent
Agreement. The Auction Agent may at any time resign and be discharged of the
duties and obligations created by the Indenture by giving at least 90 days
notice to the Indenture Trustee, the Depositor and the Calculation Agent. The
Auction Agent may be removed at any time by the Indenture Trustee upon the
written direction of the Administrator on behalf of the Issuing Entity, or the
Registered Owners of at least 66-2/3% of the aggregate principal amount of the
Auction Rate Securities then outstanding, by an instrument signed by such
noteholders or their attorneys and filed with the Auction Agent, the Issuing
Entity, the Indenture Trustee and the Calculation Agent upon at least 90 days
notice. Neither resignation nor removal of the Auction Agent pursuant to the
preceding two sentences will be effective until and unless a Substitute Auction
Agent has been appointed and has accepted such appointment. If required by the
Issuing Entity or the Calculation Agent, a Substitute Auction Agent Agreement
will be entered into with a Substitute Auction Agent. Notwithstanding the
foregoing, the Auction Agent may terminate the Auction Agent Agreement if,
within 45 days after notifying the Indenture Trustee, the Administrator on
behalf of the Issuing Entity and the Calculation Agent in writing that it has
not received payment of any Auction Agent Fee due it in accordance with the
terms of the Auction Agent Agreement, the Auction Agent does not receive such
payment.
If the Auction Agent should resign or be removed or be dissolved, or if the
property or affairs of the Auction Agent will be taken under the control of any
state or federal court or administrative body because of bankruptcy or
insolvency, or for any other reason, the Indenture Trustee, at the direction of
the Administrator on behalf of the Issuing Entity (after receipt of a
certificate from the Issuing Entity's financial advisor confirming that any
proposed Substitute Auction Agent meets the requirements described in the
preceding paragraph above), is required to use its best efforts to appoint a
Substitute Auction Agent.
C. Broker-Dealer. Existing Holders and Potential Holders may participate in
Auctions only by submitting orders (in the manner described below) through a
"Broker-Dealer," including Citigroup Global Markets Inc. as the sole initial
Broker-Dealer with respect to the Class A-2 Notes, or any other broker or dealer
(each as defined in the Securities Exchange Act of 1934, as amended), commercial
bank or other entity permitted by law to perform the functions required of a
Broker-Dealer set forth below which (i) is a Participant or an affiliate of a
Participant, (ii) has been selected by the Administrator on behalf of the
Issuing Entity and (iii) has entered into a Broker-Dealer Agreement with the
Auction Agent that remains effective, in which the Broker-Dealer agrees to
participate in Auctions as described in the Auction Procedures, as from time to
time amended or supplemented.
B-2
The Broker-Dealers are entitled to a Broker-Dealer Fee, which is payable by
the Auction Agent from moneys received from the Indenture Trustee, on each
Payment Date. Such Broker-Dealer Fee is payable from the Amount Available on
each Payment Date as provided herein. Broker-Dealers may submit Orders in
Auctions for their own accounts. Any Broker-Dealer submitting an Order for its
own account in any Auction will have an advantage over other Bidders in that it
would have knowledge of other Orders placed through it in that Auction (but it
would not have knowledge of orders submitted by other Broker-Dealers, if any).
As a result of the Broker-Dealer Bidding, the auction clearing rate may be
higher or lower than the rate that would have prevailed if the Broker-Dealer had
not bid. A Broker- Dealer may also bid in order to prevent what would otherwise
be a failed Auction, an All Hold Auction (if the Broker-Dealer owns Auction Rate
Securities in its own account) or an Auction clearing at a rate that the
Broker-Dealer believes does not reflect the market for such Auction Rate
Securities at the time of the Auction. Broker-Dealers may, but are not obligated
to, advise holders of the Auction Rate Securities that the rate that will apply
in an "all hold" Auction is often a lower rate than would apply if holders
submit Bids, and such advice, if given, may facilitate the submission of Bids by
existing holders that would avoid the occurrence of an "all hold" Auction. A
Broker-Dealer may, but is not obligated to, encourage additional or revised
investor bidding in order to prevent an "all-hold" Auction.
D. Calculation Agent. The Calculation Agent will act solely as agent of the
Issuing Entity and will not assume any obligation or relationship of agency or
trust for or with any of the Beneficial Owners. The Calculation Agent will
receive nominal compensation for the performance of its duties under the Initial
Auction Agent Agreement.
II Auction Procedures.
A. General. Auctions to establish the Auction Rate for the Auction Rate
Securities will be held on each Rate Determination Date. "Rate Determination
Date" means, initially the dates set forth in the definition of "Initial Rate
Determination Date" and thereafter, the Business Day immediately preceding the
commencement of each Auction Period. Notwithstanding the foregoing, the Rate
Determination Date for one or more Auction Periods may be changed as described
below in Section V of this Appendix B.
The Auction Agent will calculate the Auction Rate, the Maximum Auction
Rate, the All Hold Rate and the Applicable LIBOR Rate on each Rate Determination
Date. Upon receipt of notice from the Indenture Trustee of a failed Conversion
or failed Auction Period Conversion as described in the Indenture, the Auction
Agent will calculate the Maximum Auction Rate as of such failed Conversion Date
or Auction Period Conversion Date, as applicable, and give notice thereof as
provided and to the parties specified in the Auction Agent Agreement. If the
ownership of the Auction Rate Securities is no longer maintained in book-entry
form, the Calculation Agent will calculate the Maximum Auction Rate on the
Business Day immediately preceding each Rate Adjustment Date commencing after
delivery of the note. If a Payment Default has occurred, the Indenture Trustee
will calculate the Non-Payment Rate on the Rate Determination Date for (i) each
Auction Period commencing on or after the occurrence and during the continuance
of such Payment Default and (ii) any Auction Period commencing less than two
Business Days after the cure of any Payment Default. The Auction Agent will
determine the Applicable LIBOR Rate for each Auction Period other than the first
Auction
B-3
Period; provided, that if the ownership of the Auction Rate Securities is no
longer maintained in book-entry form, or if a Payment Default has occurred, then
the Indenture Trustee will determine the Applicable LIBOR Rate for each such
Auction Period. The determination by the Indenture Trustee or the Auction Agent,
as the case may be, of the Applicable LIBOR Rate will (in the absence of
manifest error) be final and binding upon the holders of the notes and all other
parties. If calculated or determined by the Auction Agent, the Auction Agent
will promptly advise the Indenture Trustee of the Applicable LIBOR Rate. Any
such rate shall be subject to the Available Funds Rate on the related Payment
Date, as calculated by the Servicer.
B. Submission of Orders. So long as the ownership of the Auction Rate
Securities is maintained in book-entry form, an Existing Holder may sell,
transfer or otherwise dispose of Auction Rate Securities only pursuant to a Bid
or Sell Order (as hereinafter defined) placed in an Auction or through a
Broker-Dealer, provided that, in the case of all transfers other than pursuant
to Auctions, such Existing Holder, its Broker-Dealer or its Participant advises
the Auction Agent of such transfer. Prior to a Conversion Date and except with
respect to the Rate Determination Date immediately preceding an Auction Period
Conversion Date, Auctions will be conducted on each Rate Determination Date, if
there is an Auction Agent on such Rate Determination Date, in the following
manner.
Prior to the Submission Deadline (defined as 1:00 P.M., eastern time, on
any Rate Determination Date or such other time on any Rate Determination Date by
which Broker-Dealers are required to submit Orders to the Auction Agent as
specified by the Auction Agent from time to time) on each Rate Determination
Date:
(i) each Existing Holder of Auction Rate Securities may submit to a
Broker-Dealer by telephone or otherwise information as to: (i) the
principal amount of outstanding Auction Rate Securities, if any, held by
such Existing Holder which such Existing Holder desires to continue to hold
without regard to the Auction Rate for the next succeeding Auction Period
(a "Hold Order"); (ii) the principal amount of outstanding Auction Rate
Securities, if any, which such Existing Holder offers to sell if the
Auction Rate for the next succeeding Auction Period will be less than the
rate per annum specified by such Existing Holder (a "Bid"); and/or (iii)
the principal amount of outstanding Auction Rate Securities, if any, held
by such Existing Holder which such Existing Holder offers to sell without
regard to the Auction Rate for the next succeeding Auction Period (a "Sell
Order"); and
(ii) one or more Broker-Dealers may contact Potential Holders to
determine the principal amount of Auction Rate Securities which each such
Potential Holder offers to purchase, if the Auction Rate for the next
succeeding Interest Period will not be less than the rate per annum
specified by such Potential Holder (also a "Bid").
Each Hold Order, Bid and Sell Order will be an "Order." Each Existing
Holder and each Potential Holder placing an Order is referred to as a "Bidder."
Subject to the provisions described below under "Validity of Orders," a Bid
by an Existing Holder will constitute an irrevocable offer to sell: (i) the
principal amount of outstanding Auction Rate Securities specified in such Bid if
the Auction Rate will be less than
B-4
the rate specified in such Bid, (ii) such principal amount or a lesser principal
amount of outstanding Auction Rate Securities to be determined as described
below in "Acceptance and Rejection of Orders," if the Auction Rate will be equal
to the rate specified in such Bid or (iii) such principal amount or a lesser
principal amount of outstanding Auction Rate Securities to be determined as
described below under "Acceptance and Rejection of Orders," if the rate
specified therein will be higher than the Maximum Auction Rate and Sufficient
Clearing Bids (as defined below) have not been made.
Subject to the provisions described below under "Validity of Orders," a
Sell Order by an Existing Holder will constitute an irrevocable offer to sell:
(i) the principal amount of outstanding Auction Rate Securities specified in
such Sell Order or (ii) such principal amount or a lesser principal amount of
outstanding Auction Rate Securities as described below under "Acceptance and
Rejection of Orders," if Sufficient Clearing Bids have not been made.
Subject to the provisions described below under "Validity of Orders," a Bid
by a Potential Holder will constitute an irrevocable offer to purchase: (i) the
principal amount of outstanding Auction Rate Securities specified in such Bid if
the Auction Rate will be higher than the rate specified in such Bid or (ii) such
principal amount or a lesser principal amount of outstanding Auction Rate
Securities as described below in "Acceptance and Rejection of Orders," if the
Auction Rate is equal to the rate specified in such Bid.
Each Broker-Dealer will submit in writing (or other electronic means
acceptable to the parties) to the Auction Agent prior to the Submission Deadline
on each Rate Determination Date all Orders obtained by such Broker-Dealer and
will specify with respect to each such Order: (i) the name of the Bidder placing
such Order; (ii) the aggregate principal amount of Auction Rate Securities that
are the subject of such Order; (iii) to the extent that such Bidder is an
Existing Holder: (a) the principal amount of Auction Rate Securities, if any,
subject to any Hold Order placed by such Existing Holder; (b) the principal
amount of Auction Rate Securities, if any, subject to any Bid placed by such
Existing Holder and the rate specified in such Bid; and (c) the principal amount
of Auction Rate Securities, if any, subject to any Sell Order placed by such
Existing Holder; and (iv) to the extent such Bidder is a Potential Holder, the
rate specified in such Potential Holder's Bid.
If any rate specified in any Bid contains more than three figures to the
right of the decimal point, the Auction Agent will round such rate up to the
next highest one-thousandth (.001) of one percent.
If an Order or Orders covering all outstanding Auction Rate Securities held
by any Existing Holder are not submitted to the Auction Agent prior to the
Submission Deadline, the Auction Agent will deem a Hold Order to have been
submitted on behalf of such Existing Holder covering the principal amount of
outstanding Auction Rate Securities held by such Existing Holder and not subject
to an Order submitted to the Auction Agent.
None of the Depositor, the Issuing Entity, the Indenture Trustee or the
Auction Agent will be responsible for any failure of a Broker-Dealer to submit
an Order to the Auction Agent on behalf of any Existing Holder or Potential
Holder.
B-5
An Existing Holder may submit multiple Orders, of different types and
specifying different rates, in an Auction with respect to Auction Rate
Securities then held by such Existing Holder. An Existing Holder that offers to
purchase additional Auction Rate Securities is, for purposes of such offer,
treated as a Potential Holder.
Any Bid specifying a rate higher than 18.00% per annum will (i) be treated
as a Sell Order if submitted by an Existing Holder and (ii) not be accepted if
submitted by a Potential Holder.
C. Validity of Orders. If any Existing Holder submits through a
Broker-Dealer to the Auction Agent one or more Orders covering in the aggregate
more than the principal amount of outstanding Auction Rate Securities held by
such Existing Holder, such Orders will be considered valid as follows and in the
order of priority described below.
(i) Hold Orders. All Hold Orders will be considered valid, but only up
to the aggregate principal amount of outstanding Auction Rate Securities
held by such Existing Holder, and if the aggregate principal amount of
Auction Rate Securities subject to such Hold Orders exceeds the aggregate
principal amount of Auction Rate Securities held by such Existing Holder,
the aggregate principal amount of Auction Rate Securities subject to each
such Hold Order will be reduced pro rata so that the aggregate principal
amount of Auction Rate Securities subject to all such Hold Orders equals
the aggregate principal amount of outstanding Auction Rate Securities held
by such Existing Holder.
(ii) Bids. Any Bid will be considered valid up to the amount of the
excess of the principal amount of outstanding Auction Rate Securities held
by such Existing Holder over the aggregate principal amount of Auction Rate
Securities subject to any Hold Orders referred to above. Subject to the
preceding sentence, if multiple Bids with the same rate are submitted on
behalf of such Existing Holder and the aggregate principal amount of
outstanding Auction Rate Securities subject to such Bids is greater than
such excess, such Bids will be considered valid up to the amount of such
excess. Subject to the two preceding sentences, if more than one Bid with
different rates are submitted on behalf of such Existing Holder, such Bids
will be considered valid first in the ascending order of their respective
rates until the highest rate is reached at which such excess exists and
then at such rate up to the amount of such excess. In any event, the
aggregate principal amount of outstanding Auction Rate Securities, if any,
subject to Bids not valid under the provisions described above will be
treated as the subject of a Bid by a Potential Holder at the rate therein
specified.
(iii) Sell Orders. All Sell Orders will be considered valid up to the
amount of the excess of the principal amount of outstanding Auction Rate
Securities held by such Existing Holder over the aggregate principal amount
of Auction Rate Securities subject to valid Hold Orders and valid Bids as
referred to above.
If more than one Bid for Auction Rate Securities is submitted on behalf of
any Potential Holder, each Bid submitted will be a separate Bid with the rate
and principal amount therein specified. An Existing Holder that offers to
purchase additional Auction Rate Securities is, for purposes of such offer,
treated as a Potential Holder. Any Bid or Sell Order submitted by an
B-6
Existing Holder covering an aggregate principal amount of Auction Rate
Securities not equal to an Authorized Denomination will be rejected and will be
deemed a Hold Order. Any Bid submitted by a Potential Holder covering an
aggregate principal amount of Auction Rate Securities not equal to an Authorized
Denomination will be rejected. Any Order submitted in an Auction by a
Broker-Dealer to the Auction Agent prior to the Submission Deadline on any Rate
Determination Date will be irrevocable; provided, however, the Auction Agent,
with the consent of the Calculation Agent and Broker-Dealer may modify such
restriction to allow revocation prior to the Submission Deadline.
A Hold Order, a Bid or a Sell Order that has been determined valid pursuant
to the procedures described above is referred to as a "Submitted Hold Order," a
"Submitted Bid" and a "Submitted Sell Order," respectively (collectively,
"Submitted Orders").
D. Determination of Sufficient Clearing Bids and Bid Auction Rate. Not
earlier than the Submission Deadline on each Rate Determination Date, the
Auction Agent will assemble all valid Submitted Orders and will determine:
(i) the excess of the total principal amount of outstanding Auction
Rate Securities over the sum of the aggregate principal amount of
outstanding Auction Rate Securities subject to Submitted Hold Orders (such
excess being hereinafter referred to as the "Available Auction Rate
Securities"); and
(ii) from such Submitted Orders, whether the aggregate principal
amount of outstanding Auction Rate Securities subject to Submitted Bids by
Potential Holders specifying one or more rates equal to or lower than the
maximum cap rate of 18.00% per annum exceeds or is equal to the sum of (i)
the aggregate principal amount of outstanding Auction Rate Securities
subject to Submitted Bids by Existing Holders specifying one or more rates
higher than 18.00% per annum and (ii) the aggregate principal amount of
outstanding Auction Rate Securities subject to Submitted Sell Orders (in
the event such excess or such equality exists other than because all of the
outstanding Auction Rate Securities are subject to Submitted Hold Orders,
such Submitted Bids by Potential Holders above will be hereinafter referred
to collectively as "Sufficient Clearing Bids"); and
(iii) if Sufficient Clearing Bids exist, the "Bid Auction Rate," which
will be the lowest rate specified in such Submitted Bids such that if:
(a) each such Submitted Bid from Existing Holders specifying such
lowest rate and all other Submitted Bids from Existing Holders
specifying lower rates were rejected (thus entitling such Existing
Holders to continue to hold the principal amount of Auction Rate
Securities subject to such Submitted Bids); and
(b) each such Submitted Bid from Potential Holders specifying
such lowest rate and all other Submitted Bids from Potential Holders
specifying lower rates, were accepted,
the result would be that such Existing Holders described in subparagraph
(i) above would continue to hold an aggregate principal amount of outstanding
Auction Rate Securities which,
B-7
when added to the aggregate principal amount of outstanding Auction Rate
Securities to be purchased by such Potential Holders described in subparagraph
(ii) above, would equal not less than the Available Auction Rate Securities.
E. Notice of Auction Rate. Promptly after the Auction Agent has made the
determinations described above, and has received from the Servicer its
determination of the Net Contract Rate, the Auction Agent will advise the
Indenture Trustee and the Broker-Dealers of the Net Contract Rate, of the
Maximum Auction Rate, the All Hold Rate and the components thereof on the Rate
Determination Date, and based on such determinations, the Auction Rate for the
next succeeding Auction Period will be as follows:
(i) if Sufficient Clearing Bids exist, the Auction Rate for the next
succeeding Auction Period will be equal to the Bid Auction Rate so
determined;
(ii) if Sufficient Clearing Bids do not exist (other than because all
of the outstanding Auction Rate Securities are subject to Submitted Hold
Orders), the Auction Rate for the next succeeding Auction Period will be
equal to the Maximum Auction Rate; or
(iii) if all outstanding Auction Rate Securities are subject to
Submitted Hold Orders, the Auction Rate for the next succeeding Auction
Period will be equal to the All Hold Rate.
Promptly after the Auction Agent has determined the Auction Rate, the
Auction Agent will determine and advise the Indenture Trustee of the Auction
Rate on the Determination Date for the related Payment Date and the Servicer
will advise the Indenture Trustee of the applicable Available Funds Rate. The
Class A-2 Note Rate for the Payment Date will be the least of (a) the Auction
Rate, (b) the Net Contract Rate and (c) the maximum cap rate of 18.00% per
annum.
F. Acceptance and Rejection of Orders. Existing Holders will continue to
hold the principal amount of Auction Rate Securities that are subject to
Submitted Hold Orders. If Sufficient Clearing Bids, as described above under
"Determination of Sufficient Clearing Bids and Bid Auction Rate," have been
received by the Auction Agent, the Bid Auction Rate will be the Auction Rate,
and Submitted Bids and Submitted Sell Orders will be accepted or rejected and
the Auction Agent will take such other action as set forth below.
For any Payment Date prior to a Conversion, if the Net Contract Rate is
greater than the Auction Rate, the Class A-2 Note Rate will be the Auction Rate.
For any Payment Date prior to a Conversion, if the Net Contract Rate is less
than the Auction Rate, the Class A-2 Note Rate will be the Net Contract Rate. If
the Auction Rate and the Net Contract Rate are both greater than 18.00% per
annum, the Class A-2 Note Rate will be equal to 18.00% per annum. If the Auction
Agent has not received Sufficient Clearing Bids as described above under
"Determination of Sufficient Clearing Bids and Bid Auction Rate" (other than
because all of the outstanding Auction Rate Securities are subject to Submitted
Holds Orders), the Auction Rate will be the Maximum Auction Rate. In any of the
cases described above in this paragraph, Submitted Orders will be accepted or
rejected and the Auction Agent will take such other action as described below
under "Insufficient Bids."
B-8
(i) Sufficient Clearing Bids. If Sufficient Clearing Bids have been
made, the Auction Rate will be the Bid Auction Rate), all Submitted Sell
Orders will be accepted and, subject to the denomination requirements
described below, Submitted Bids will be accepted or rejected as follows in
the following order of priority:
(a) Existing Holders' Submitted Bids specifying any rate that is
higher than the Bid Auction Rate will be accepted, thus requiring each
such Existing Holder to sell the aggregate principal amount of Auction
Rate Securities subject to such Submitted Bids;
(b) Existing Holders' Submitted Bids specifying any rate that is
lower than the Bid Auction Rate will be rejected, thus entitling each
such Existing Holder to continue to hold the aggregate principal
amount of Auction Rate Securities subject to such Submitted Bids;
(c) Potential Holders' Submitted Bids specifying any rate that is
lower than the Bid Auction Rate will be accepted;
(d) Each Existing Holder's Submitted Bid specifying a rate that
is equal to the Bid Auction Rate will be rejected, thus entitling such
Existing Holder to continue to hold the aggregate principal amount of
Auction Rate Securities subject to such Submitted Bid, unless the
aggregate principal amount of Auction Rate Securities subject to such
Submitted Bids will be greater than the principal amount of Auction
Rate Securities (the "remaining principal amount") equal to the excess
of the Available Auction Rate Securities over the aggregate principal
amount of Auction Rate Securities subject to Submitted Bids described
in subparagraphs (b) and (c) above, in which event such Submitted Bid
of such Existing Holder will be rejected in part and such Existing
Holder will be entitled to continue to hold the principal amount of
Auction Rate Securities subject to such Submitted Bid, but only in an
amount equal to the aggregate principal amount of Auction Rate
Securities obtained by multiplying the remaining principal amount by a
fraction, the numerator of which will be the principal amount of
outstanding Auction Rate Securities held by such Existing Holder
subject to such Submitted Bid and the denominator of which will be the
sum of the principal amount of outstanding Auction Rate Securities
subject to such Submitted Bids made by all such Existing Holders that
specified a rate equal to the Bid Auction Rate;
(e) Each Potential Holder's Submitted Bid specifying a rate that
is equal to the Bid Auction Rate will be accepted, but only in an
amount equal to the principal amount of Auction Rate Securities
obtained by multiplying the excess of the aggregate principal amount
of Available Auction Rate Securities over the aggregate principal
amount of Auction Rate Securities subject to Submitted Bids described
in subparagraphs (b), (c) and (d) above by a fraction, the numerator
of which will be the aggregate principal amount of outstanding Auction
Rate Securities subject to such Submitted Bid and the denominator of
which will be the sum of the principal amount of outstanding Auction
Rate Securities subject to
B-9
Submitted Bids made by all such Potential Holders that specified a
rate equal to the Bid Auction Rate; and
(f) Each Potential Holder's Submitted Bid specifying a rate that
is higher than the Bid Auction Rate will be rejected.
(ii) Insufficient Bids. If Sufficient Clearing Bids have not been made
(other than because all of the outstanding Auction Rate Securities are
subject to Submitted Hold Orders) or if the Net Contract Rate is less than
the Bid Auction Rate (in which case the Class A-2 Note Rate will be limited
by the Net Contract Rate) or if the Auction Rate would be greater than
18.00% per annum, subject to the denomination requirements described below,
Submitted Orders will be accepted or rejected as follows in the following
order of priority:
(a) Existing Holders' Submitted Bids specifying any rate that is
equal to or lower than the Maximum Auction Rate will be rejected, thus
entitling such Existing Holders to continue to hold the aggregate
principal amount of Auction Rate Securities subject to such Submitted
Bids;
(b) Potential Holders' Submitted Bids specifying (i) a rate that
is equal to or lower than the Maximum Auction Rate will be accepted,
and (ii) a rate that is higher than the Maximum Auction Rate will be
rejected; and
(c) Each Existing Holder's Submitted Bid specifying any rate that
is higher than the Maximum Auction Rate and the Submitted Sell Order
of each Existing Holder will be accepted, thus entitling each Existing
Holder that submitted any such Submitted Bid or Submitted Sell Order
to sell the Auction Rate Securities subject to such Submitted Bid or
Submitted Sell Order, but in both cases only in an amount equal to the
aggregate principal amount of Auction Rate Securities obtained by
multiplying the aggregate principal amount of Auction Rate Securities
subject to Submitted Bids described in subparagraph (b) above by a
fraction, the numerator of which will be the aggregate principal
amount of outstanding Auction Rate Securities held by such Existing
Holder subject to such Submitted Bid or Submitted Sell Order and the
denominator of which will be the aggregate principal amount of
outstanding Auction Rate Securities subject to all such Submitted Bids
and Submitted Sell Orders.
(iii) All Hold Orders. If all outstanding Auction Rate Securities are
subject to Submitted Hold Orders, all Submitted Bids will be rejected.
(iv) Authorized Denominations Requirement. If, as a result of the
procedures described above regarding Sufficient Clearing Bids and
Insufficient Bids, any Existing Holder would be entitled or required to
sell, or any Potential Holder would be entitled or required to purchase, a
principal amount of Auction Rate Securities that is not equal to an
Authorized Denomination, the Auction Agent will, in such manner as in its
sole discretion it will determine, round up or down the principal amount of
Auction Rate Securities to be purchased or sold by any Existing Holder or
Potential Holder so that the
B-10
principal amount of Auction Rate Securities purchased or sold by each
Existing Holder or Potential Holder will be equal to an Authorized
Denomination. If, as a result of the procedures described above regarding
Insufficient Bids, any Potential Holder would be entitled or required to
purchase less than a principal amount of Auction Rate Securities equal to
an Authorized Denomination or any integral multiple thereof, the Auction
Agent will, in such manner as in its sole discretion it will determine,
allocate Auction Rate Securities for purchase among Potential Holders so
that only Auction Rate Securities in an Authorized Denomination are
purchased by any Potential Holder, even if such allocation results in one
or more of such Potential Holders not purchasing any Auction Rate
Securities.
Based on the results of each Auction, the Auction Agent will determine the
aggregate principal amount of Auction Rate Securities to be purchased and the
aggregate principal amount of Auction Rate Securities to be sold by Potential
Holders and Existing Holders on whose behalf each Broker-Dealer submitted Bids
or Sell Orders and, with respect to each Broker-Dealer, to the extent that such
aggregate principal amount of Auction Rate Securities to be sold differs from
such aggregate principal amount of Auction Rate Securities to be purchased,
determine to which other Broker-Dealer or Broker-Dealers acting for one or more
purchasers such Broker-Dealer will deliver, or from which Broker-Dealers acting
for one or more sellers such Broker-Dealer will receive, as the case may be,
Auction Rate Securities.
Any calculation by the Auction Agent, Calculation Agent, or Indenture
Trustee, as applicable, of the Auction Rate, the Applicable LIBOR Rate, the
Maximum Auction Rate, the All Hold Rate, and the Non-Payment Rate and the
amounts of interest payable on any Auction Rate Securities will, in the absence
of manifest error, be binding on all other parties, including without
limitation, the Depositor and the holders of the notes.
III. Settlement Procedures.
The Auction Agent is required to advise each Broker-Dealer that submitted
an Order in an Auction of the Auction Rate and the Net Contract Rate for the
next Auction Period and, if such Order was a Bid or Sell Order, whether such Bid
or Sell Order was accepted or rejected, in whole or in part, by telephone not
later than 3:00 p.m., eastern time, on the Rate Determination Date, if the Class
A-2 Note Rate is based on the Auction Rate, or 4:00 p.m., eastern time, on the
Rate Determination Date, if the Net Contract Rate is lower than the Auction
Rate. Each Broker-Dealer that submitted an Order on behalf of a Bidder is
required to then advise such Bidder of the Auction Rate for the next Payment
Date), and, if such Order was a Bid or a Sell Order, whether such Bid or Sell
Order was accepted or rejected, in whole or in part, confirm purchases and sales
with each Bidder purchasing or selling Auction Rate Securities as a result of
the Auction and advise each Bidder purchasing or selling Auction Rate Securities
as a result of the Auction to give instructions to its Participant to pay the
purchase price against delivery of such Auction Rate Securities or to deliver
such Auction Rate Securities against payment therefor, as appropriate. Pursuant
to the Auction Agent Agreement, the Auction Agent will record each transfer of
Auction Rate Securities on the Existing Holders registry to be maintained by the
Auction Agent.
B-11
In accordance with DTC's normal procedures, on the Business Day after the
Rate Determination Date, the transactions described above will be executed
through DTC, so long as DTC is the depository for the Class A-2 Notes (the
"Depository"), and the accounts of the respective Participants at DTC will be
debited and credited and Auction Rate Securities delivered as necessary to
effect the purchases and sales of Auction Rate Securities as determined in the
Auction. Purchasers are required to make payment through their Participants in
same-day funds to DTC against delivery through their Participants. DTC will make
payment in accordance with its normal procedures, which now provide for payment
against delivery by its Participants in immediately available funds.
If any Existing Holder selling Auction Rate Securities in an Auction fails
to deliver such Auction Rate Securities, the Broker-Dealer of any person that
was to have purchased Auction Rate Securities in such Auction may deliver to
such person a principal amount of Auction Rate Securities that is less than the
principal amount of Auction Rate Securities that otherwise was to be purchased
by such person but in any event equal to an Authorized Denomination. In such
event, the principal amount of Auction Rate Securities to be delivered will be
determined by such Broker-Dealer. Delivery of such lesser principal amount of
Auction Rate Securities will constitute good delivery. Neither the Indenture
Trustee nor the Auction Agent will have any responsibility or liability with
respect to the failure of a Potential Holder, Existing Holder or their
respective Broker-Dealer or Participant to deliver the principal amount of
Auction Rate Securities or to pay for the Auction Rate Securities purchased or
sold pursuant to an Auction or otherwise.
IV. Indenture Trustee Not Responsible for Auction Agent, Calculation Agent and
Broker-Dealers.
The Indenture Trustee will not be liable or responsible for the actions of
or failure to act by the Auction Agent, Calculation Agent or any Broker-Dealer
under the Indenture or under the Auction Agent Agreement or any Broker-Dealer
Agreement. The Indenture Trustee may conclusively rely upon any information
required to be furnished by the Auction Agent, the Calculation Agent or any
Broker-Dealer without undertaking any independent review or investigation of the
truth or accuracy of such information. In no event will the Indenture Trustee be
responsible for the fees of the Auction Agent or any other party.
V. Changes in Auction Terms.
A. Changes in Auction Period or Periods. The Issuing Entity may change,
from time to time, the length of the one or more Auction Periods in order to
conform with then current market practice with respect to similar securities or
to accommodate economic and financial factors that may affect or be relevant to
the length of the Auction Period or the interest rate borne by the Auction Rate
Securities (an "Auction Period Adjustment"). The Issuing Entity will not
initiate such change in the length of the Auction Period unless it has received
the written consent of the Calculation Agent, which consent may not be
unreasonably withheld, not less than fifteen (15) days nor more than twenty (20)
days prior to the effective date of an Auction Period Adjustment. The Issuing
Entity will initiate an Auction Period Adjustment by giving written notice to
the Indenture Trustee, the Auction Agent, the Calculation Agent, the Depository
and
B-12
each Rating Agency then rating the Auction Rate Securities subject to such
Auction Period Adjustment at least ten (10) days prior to the Rate Determination
Date for such Auction Period.
No Auction Period Adjustment may result in an Auction Period of less than 7
nor more than 91 days, with respect to Auction Rate Securities with a Short
Auction Period, or in an Auction Period that is more than three months shorter
or longer than the Auction Period established upon the issuance or Auction
Period Conversion of such Auction Rate Securities, with respect to Auction Rate
Securities with a Long Auction Period. An Auction Period Adjustment will not be
allowed unless Sufficient Clearing Bids existed or all Auction Rate Securities
were subject to Submitted Hold Orders at both the Auction preceding the date on
which the notice of the proposed change was given as described above and the
Auction preceding the proposed change.
An Auction Period Adjustment will take effect only if (A) the Indenture
Trustee and the Auction Agent receive, by 11:00 A.M., eastern time, on the
Business Day before the Rate Determination Date for the first such Auction
Period, a certificate from the Issuing Entity authorizing an Auction Period
Adjustment specified in such certificate and the written consent of the
Calculation Agent described above, and (B) Sufficient Clearing Bids exist or all
Auction Rate Securities were subject to Submitted Hold Orders at the Auction on
the Rate Determination Date for such first Auction Period. If the condition
referred to in (A) is not met, the Auction Rate applicable for the next Auction
Period will be determined pursuant to the Auction Procedures and the length of
the Auction Period will remain the same. If the condition referred to in (A) is
met, but the condition referred to in (B) above is not met, the Auction Rate
applicable for the next Auction Period will be the lesser of the Maximum Auction
Rate and the Net Contract Rate, but in no event greater than 18.00%, and the
length of the Auction Period will remain the same.
The Issuing Entity, with the written consent of the Rating Agencies then
rating the Class A-2 Notes, may, from time to time, change the length of one or
more Auction Periods pursuant to an Auction Period Conversion. In the event of a
failed Auction Period Conversion, the Auction Rate for the Auction Period for
which the proposed Auction Period Conversion was to have been effective will be
the Maximum Auction Rate, and the length of the Auction Period commencing upon
the failed Auction Period Adjustment will remain the same.
B. Changes in the Rate Determination Date. The Calculation Agent may, with
the consent of an Authorized Officer of the Depositor, specify an earlier Rate
Determination Date than the Rate Determination Date that would otherwise be
determined in accordance with the definition of "Rate Determination Date" with
respect to one or more specified Auction Periods in order to conform with then
current market practice with respect to similar securities or to accommodate
economic and financial factors that may affect or be relevant to the day of the
week constituting a Rate Determination Date and the Class A-2 Note Rate. The
Authorized Officer of the Depositor will not consent to such change in the Rate
Determination Date unless he or she will have received from the Calculation
Agent not less than 15 days nor more than 20 days prior to the effective date of
such change a written request for consent. The Calculation Agent will provide
notice of its determination to specify an earlier Rate Determination Date for
one or more Auction Periods by means of a written notice delivered at least 10
days prior to the proposed changed Rate Determination Date to the Indenture
Trustee, the Auction Agent, the
B-13
Issuing Entity and the Securities Depository. Such notice will be substantially
in the form of, or contain substantially the information contained in, the
Indenture.
B-14