Exhibit 10.21
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INDENTURE
between
OPTION ONE OWNER TRUST 2005-8
as Issuer
and
WELLS FARGO BANK, N.A.
as Indenture Trustee
Dated as of October 1, 2005
OPTION ONE OWNER TRUST 2005-8
MORTGAGE-BACKED NOTES
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TABLE OF CONTENTS
Page
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ARTICLE I
DEFINITIONS
Section 1.01. Definitions ............................................ 2
Section 1.02. Rules of Construction .................................. 7
ARTICLE II
GENERAL PROVISIONS WITH RESPECT TO THE NOTES
Section 2.01. Method of Issuance and Form of Notes ................... 8
Section 2.02. Execution, Authentication, Delivery and Dating ......... 8
Section 2.03. Registration; Registration of Transfer and Exchange .... 9
Section 2.04. Mutilated, Destroyed, Lost or Stolen Notes ............. 10
Section 2.05. Persons Deemed Noteholders ............................. 11
Section 2.06. Payment of Principal and/or Interest; Defaulted
Interest ............................................... 11
Section 2.07. Cancellation ........................................... 12
Section 2.08. Conditions Precedent to the Authentication of the
Notes .................................................. 12
Section 2.09. Release of Collateral .................................. 14
Section 2.10. Additional Note Principal Balance ...................... 14
Section 2.11. Tax Treatment .......................................... 14
Section 2.12. Limitations on Transfer of the Notes ................... 15
ARTICLE III
COVENANTS
Section 3.01. Payment of Principal and/or Interest ................... 15
Section 3.02. Maintenance of Office or Agency ........................ 16
Section 3.03. Money for Payments to Be Held in Trust ................. 16
Section 3.04. Existence .............................................. 17
Section 3.05. Protection of Collateral ............................... 18
Section 3.06. Negative Covenants ..................................... 18
Section 3.07. Performance of Obligations; Servicing of Loans ......... 19
Section 3.08. Reserved ............................................... 20
Section 3.09. Annual Statement as to Compliance ...................... 21
Section 3.10. Covenants of the Issuer ................................ 21
Section 3.11. Servicer's Obligations ................................. 21
Section 3.12. Restricted Payments .................................... 21
Section 3.13. Treatment of Notes as Debt for All Purposes ............ 21
Section 3.14. Notice of Events of Default ............................ 21
Section 3.15. Further Instruments and Acts ........................... 22
ARTICLE IV
SATISFACTION AND DISCHARGE
Section 4.01. Satisfaction and Discharge of Indenture ................ 22
Section 4.02. Application of Trust Money ............................. 23
Section 4.03. Repayment of Moneys Held by Paying Agent ............... 23
ARTICLE V
REMEDIES
Section 5.01. Events of Default ...................................... 23
Section 5.02. Acceleration of Maturity; Rescission and Annulment ..... 25
Section 5.03. Collection of Indebtedness and Suits for Enforcement
by Indenture Trustee ................................... 26
Section 5.04. Remedies; Priorities ................................... 28
Section 5.05. Optional Preservation of the Collateral ................ 30
Section 5.06. Limitation of Suits .................................... 30
Section 5.07. Unconditional Rights of Noteholders to Receive
Principal and/or Interest .............................. 31
Section 5.08. Restoration of Rights and Remedies ..................... 31
Section 5.09. Rights and Remedies Cumulative ......................... 31
Section 5.10. Delay or Omission Not a Waiver ......................... 31
Section 5.11. Control by Noteholders ................................. 31
Section 5.12. Waiver of Past Defaults ................................ 32
Section 5.13. Undertaking for Costs .................................. 32
Section 5.14. Waiver of Stay or Extension Laws ....................... 33
Section 5.15. Action on Notes ........................................ 33
Section 5.16. Performance and Enforcement of Certain Obligations ..... 33
ARTICLE VI
THE INDENTURE TRUSTEE
Section 6.01. Duties of Indenture Trustee ............................ 34
Section 6.02. Rights of Indenture Trustee ............................ 35
Section 6.03. Individual Rights of Indenture Trustee ................. 36
Section 6.04. Indenture Trustee's Disclaimer ......................... 36
Section 6.05. Notices of Default ..................................... 36
Section 6.06. Reports by Indenture Trustee to Holders ................ 36
Section 6.07. Compensation and Indemnity ............................. 36
Section 6.08. Replacement of Indenture Trustee ....................... 37
Section 6.09. Successor Indenture Trustee by Merger .................. 38
Section 6.10. Appointment of Co-Indenture Trustee or Separate
Indenture Trustee ...................................... 38
Section 6.11. Eligibility ............................................ 39
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ARTICLE VII
NOTEHOLDERS' LISTS AND REPORTS
Section 7.01. Issuer to Furnish Indenture Trustee Names and
Addresses of Noteholders ............................... 39
Section 7.02. Preservation of Information ............................ 40
Section 7.03. 144A Information ....................................... 40
ARTICLE VIII
ACCOUNTS, DISBURSEMENTS AND RELEASES
Section 8.01. Collection of Money .................................... 40
Section 8.02. Trust Accounts; Distributions .......................... 40
Section 8.03. General Provisions Regarding Trust Accounts ............ 41
Section 8.04. The Paying Agent ....................................... 42
Section 8.05. Release of Collateral .................................. 42
Section 8.06. Opinion of Counsel ..................................... 42
ARTICLE IX
SUPPLEMENTAL INDENTURES
Section 9.01. Supplemental Indentures Without the Consent of the
Noteholders ............................................ 43
Section 9.02. Supplemental Indentures with Consent of Noteholders .... 43
Section 9.03. Execution of Supplemental Indentures ................... 45
Section 9.04. Effect of Supplemental Indentures ...................... 45
Section 9.05. Reference in Notes to Supplemental Indentures .......... 45
ARTICLE X
REDEMPTION OF NOTES; PUT OPTION
Section 10.01. Redemption ............................................. 45
Section 10.02. Form of Redemption Notice .............................. 46
Section 10.03. Notes Payable on Redemption Date ....................... 46
Section 10.04. Put Option ............................................. 46
Section 10.05. Form of Put Option Notice .............................. 46
Section 10.06. Notes Payable on Put Date .............................. 46
ARTICLE XI
MISCELLANEOUS
Section 11.01. Compliance Certificates and Opinions, etc .............. 47
Section 11.02. Form of Documents Delivered to Indenture Trustee ....... 47
Section 11.03. Acts of Noteholders .................................... 48
Section 11.04. Notices, etc., to Indenture Trustee and Issuer ......... 49
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Section 11.05. Notices to Noteholders; Waiver ......................... 49
Section 11.06. Effect of Headings and Table of Contents ............... 50
Section 11.07. Successors and Assigns ................................. 50
Section 11.08. Separability ........................................... 50
Section 11.09. Benefits of Indenture .................................. 50
Section 11.10. Legal Holidays ......................................... 50
Section 11.11. GOVERNING LAW .......................................... 50
Section 11.12. Counterparts ........................................... 50
Section 11.13. Recording of Indenture ................................. 50
Section 11.14. Trust Obligation ....................................... 50
Section 11.15. No Petition ............................................ 51
Section 11.16. Inspection ............................................. 51
Section 11.17. Third Party Beneficiary ................................ 51
Section 11.18. Limitation on Liability ................................ 51
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EXHIBITS
EXHIBIT A Form of Notes
EXHIBIT B-1 Form of Transferor Affidavit (144A)
EXHIBIT B-2 Form of Transferee Affidavit (Accredited Investor)
EXHIBIT B-3 Form of Transfer Affidavit
EXHIBIT C Form of Securities Legend
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INDENTURE
INDENTURE dated as of October 1, 2005 (the "Indenture"), between
OPTION ONE OWNER TRUST 2005-8, a Delaware statutory trust, as Issuer (the
"Issuer"), and WELLS FARGO BANK, N.A., as Indenture Trustee (the "Indenture
Trustee").
WITNESSETH THAT:
In consideration of the mutual covenants herein contained, the Issuer
has duly authorized the execution and delivery of this Indenture to provide for
the issuance of Notes, issuable as provided in this Indenture. All covenants and
agreements made by the Issuer herein are for the benefit and security of the
Noteholders.
GRANTING CLAUSE
Subject to the terms of this Indenture, the Issuer hereby Grants on
the Closing Date, to the Indenture Trustee, as Indenture Trustee for the benefit
of the Noteholders, all of the Issuer's right, title and interest, whether now
owned or hereafter acquired, in and to: (i) such Loans as from time to time are
subject to the Sale and Servicing Agreement as listed in the Loan Schedule, as
the same may be amended or supplemented on each Transfer Date and by the removal
of Deleted Loans and Unqualified Loans and by the addition of Qualified
Substitute Loans, together with the Servicer's Loan Files and the Custodial Loan
Files relating thereto and all proceeds thereof, (ii) the Mortgages and security
interests in the Mortgaged Properties, (iii) all payments in respect of interest
and principal with respect to each Loan received on or after the related
Transfer Cut-off Date, (iv) such assets as from time to time are identified as
Foreclosure Property, (v) such assets and funds as are from time to time
deposited in or credited to the Distribution Account, Collection Account and the
Transfer Obligation Account, including, without limitation, amounts on deposit
in or credited to such accounts that are invested in Permitted Investments
(including, without limitation, all security entitlements (as defined in Section
8-102(17) of the UCC) of the Issuer therein), (vi) lenders' rights under all
Mortgage Insurance Policies and to any Mortgage Insurance Proceeds, (vii) Net
Liquidation Proceeds and Released Mortgaged Property Proceeds, (viii) all right,
title and interest of the Trust (but none of the obligations) in and to the
obligations of Hedging Counterparties under Hedging Instruments; (ix) all right,
title and interest of each of the Depositor, the Loan Originator and the Trust
in and under the Basic Documents including, without limitation, the obligations
of the Loan Originator under the Loan Purchase and Contribution Agreement and/or
the Master Disposition Confirmation Agreement, and all proceeds of any of the
foregoing, (x) all right, title and interest of the Issuer in and to the Sale
and Servicing Agreement, including the Issuer's right to cause the Loan
Originator to repurchase Loans from the Issuer under certain circumstances
described therein, (xi) all other property of the Trust from time to time and
(xii) all present and future claims, demands, causes of action 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, including all proceeds of the conversion thereof, voluntary or
involuntary, into cash or other liquid property, all cash and noncash proceeds
(each as defined in Section 9-102(a) of the UCC), accounts, accounts receivable,
notes, drafts, acceptances, chattel paper, checks, deposit accounts, insurance
proceeds, payment intangibles, securities accounts, condemnation awards, 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 "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, and to secure compliance with the provisions of this Indenture, all as
provided in this Indenture.
The Indenture Trustee, as Indenture Trustee on behalf of the
Noteholders, acknowledges such Grant, accepts the trusts hereunder and agrees to
perform its duties required in this Indenture to the best of its ability to the
end that the interests of the Noteholders may adequately and effectively be
protected.
ARTICLE I
DEFINITIONS
Section 1.01. Definitions. (a) Except as otherwise specified herein,
the following terms have the respective meanings set forth below for all
purposes of this Indenture.
"Act" has the meaning specified in Section 11.03(a) hereof.
"Additional Note Principal Balance" has the meaning set forth in the
Sale and Servicing Agreement.
"Administration Agreement" means the Administration Agreement dated as
of October 1, 2005, between the Issuer and the Administrator.
"Administrator" means Option One Mortgage Corporation, or any
successor Administrator under the Administration Agreement.
"Authorized Officer" means, with respect to the Issuer, any officer of
the Owner Trustee who is authorized to act for the Owner Trustee in matters
relating to the Issuer and who is identified on the list of Authorized Officers
delivered by the Owner Trustee to the Indenture Trustee on the Closing Date (as
such list may be modified or supplemented from time to time thereafter) and, so
long as the Administration Agreement is in effect, any Vice President or more
senior officer of the Administrator who is authorized to act for the
Administrator in matters relating to the Issuer and to be acted upon by the
Administrator pursuant to the Administration Agreement and who is identified on
the list of Authorized Officers delivered by the Administrator to the Indenture
Trustee on the Closing Date (as such list may be modified or supplemented from
time to time thereafter).
"Basic Documents" has the meaning set forth in the Sale and Servicing
Agreement.
"Certificate of Trust" means the certificate of trust of the Issuer
substantially in the form of Exhibit C to the Trust Agreement.
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"Change of Control" means the acquisition by any Person, or two or
more Persons acting in concert, of beneficial ownership (within the meaning of
Rule 13d-3 of the Securities and Exchange Commission under the Securities
Exchange Act of 1934) of outstanding shares of voting stock of the Loan
Originator at any time if after giving effect to such acquisition (i) such
Person or Persons owns twenty percent (20%) or more of such outstanding voting
stock or (ii) H&R Block, Inc. does not own more than fifty percent (50%) of such
outstanding shares of voting stock.
"Clean-up Call Date" has the meaning set forth in the Sale and
Servicing Agreement.
"Closing Date" means October 7, 2005.
"Collateral" has the meaning specified in the Granting Clause of this
Indenture.
"Commission" means the Securities and Exchange Commission.
"Corporate Trust Office" means the principal office of the Indenture
Trustee at which at any particular time its corporate trust business shall be
administered, which office at date of execution of this Indenture is located,
for note transfer purposes, at Sixth Street and Marquette Avenue, Minneapolis,
Minnesota 55479, Attention: Option One Owner Trust 2005-8, telecopy number:
(612) 667-6282, telephone number: (800) 344-5128, and for all other purposes, at
9062 Old Annapolis Road, Columbia, Maryland 21045, Attention: Option One Owner
Trust 2005-8, telecopy number: (410) 715-2380, telephone number: (410) 884-2000,
or at such other address as the Indenture Trustee may designate from time to
time by notice to the Noteholders and the Issuer, or the principal corporate
trust office of any successor Indenture Trustee at the address designated by
such successor Indenture Trustee by notice to the Noteholders and the Issuer.
"Default" means any occurrence that is, or with notice or the lapse of
time or both would become, an Event of Default.
"Depositor" shall mean Option One Loan Warehouse Corporation, a
Delaware corporation; in its capacity as depositor under the Sale and Servicing
Agreement, or any successor in interest thereto.
"Depository Institution" means 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 that are rated at a rating to which the Majority Noteholders consent
in writing.
"Event of Default" has the meaning specified in Section 5.01 hereof.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
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"Executive Officer" means, with respect to (i) the Depositor, the
Servicer, the Loan Originator or any Affiliate of any of them, the President,
any Vice President or the Treasurer of such corporation; and with respect to any
partnership, any general partner thereof, (ii) the Note Registrar, any
Responsible Officer of the Indenture Trustee, (iii) any other corporation, the
Chief Executive Officer, Chief Operating Officer, Chief Financial Officer,
President, Executive Vice President, any Vice President, the Secretary or the
Treasurer of such entity and (iv) any partnership, any general partner thereof.
"Grant" means mortgage, 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 this 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 the Collateral 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.
"Holder" means the Person in whose name a Note is registered on the
Note Register.
"ICA Owner" means "beneficial owner" as such term is used in Section
3(c)(1) of the Investment Company Act of 1940, as amended (other than any
persons who are excluded from such term or from the 100-beneficial owner test of
Section 3(c)(1) by law or regulations adopted by the Securities and Exchange
Commission).
"Indenture" means this Indenture and any amendments hereto.
"Indenture Trustee" means Wells Fargo Bank, N.A., a national banking
association, as Indenture Trustee under this Indenture, or any successor
Indenture Trustee hereunder.
"Issuer" means Option One Owner Trust 2005-8.
"Issuer Order" and "Issuer Request" mean a written order or request
signed in the name of the Issuer by any one of its Authorized Officers and
delivered to the Indenture Trustee.
"Loan Originator" means Option One Mortgage Corporation, a California
corporation.
"Majority Certificateholders" has the meaning set forth in the Sale
and Servicing Agreement.
"Maturity Date" means, with respect to the Notes, 364 days after the
commencement of the Revolving Period.
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"Maximum Note Principal Balance" has the meaning set forth in the
Pricing Letter.
"Note" means any Note authorized by and authenticated and delivered
under this Indenture.
"Note Interest Rate" has the meaning set forth in the Pricing Letter.
"Note Principal Balance" has the meaning set forth in the Sale and
Servicing Agreement.
"Note Purchase Agreement" means the Note Purchase Agreement dated as
of October 1, 2005 among the Issuer, Merrill Lynch Bank USA, as Noteholder
Agent, Merrill Lynch Bank USA, as purchaser.
"Note Redemption Amount" has the meaning set forth in the Sale and
Servicing Agreement.
"Note Register" and "Note Registrar" have the respective meanings
specified in Section 2.03 hereof.
"Noteholder" means the Person in whose name a Note is registered on
the Note Register.
"Officer's Certificate" means a certificate signed by any Authorized
Officer of the Issuer or the Administrator, under the circumstances described
in, and otherwise complying with, the applicable requirements of Section 11.01
hereof, and delivered to the Indenture Trustee. Unless otherwise specified, any
reference in this Indenture to an Officer's Certificate shall be to an Officer's
Certificate of any Authorized Officer of the Issuer or the Administrator.
"Opinion of Counsel" means one or more written opinions of counsel who
may, except as otherwise expressly provided in this Indenture, be an employee of
or counsel to the Issuer, and which opinion or opinions shall be addressed to
the Indenture Trustee, as Indenture Trustee, and shall comply with any
applicable requirements of Section 11.01 hereof and shall be in form and
substance satisfactory to the Noteholder Agent.
"Outstanding" means, with respect to any Note and as of the date of
determination, any Note theretofore authenticated and delivered under this
Indenture except:
(i) Notes theretofore canceled by the Note Registrar or delivered to the
Note Registrar for cancellation;
(ii) Notes or portions thereof the payment for which money in the necessary
amount has theretofore been deposited with the Indenture Trustee or any Paying
Agent in trust for the Noteholders (provided, however, that if such Notes are to
be redeemed, notice of such redemption has been duly given pursuant to this
Indenture or provision for such notice satisfactory to the Indenture Trustee has
been made); and
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(iii) Notes in exchange for or in lieu of which other Notes have been
authenticated and delivered pursuant to this Indenture unless proof satisfactory
to the Indenture Trustee is presented that any such Notes are held by a bona
fide purchaser; provided, however, that in determining whether the Noteholders
representing the requisite Percentage Interests of the Outstanding Notes have
given any request, demand, authorization, direction, notice, consent or waiver
hereunder or under any Basic Document, Notes owned by the Issuer, any other
obligor upon the Notes, the Depositor or any Affiliate of any of the foregoing
Persons shall be disregarded and deemed not to be Outstanding, except 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 the Indenture Trustee actually knows to be owned in such manner shall
be disregarded. Notes owned in such manner that have been pledged in good faith
may be regarded as Outstanding if the pledgee certifies to the Indenture Trustee
(y) that the pledgee has the right so to act with respect to such Notes and (z)
that the pledgee is not the Issuer, any other obligor upon the Notes, the
Depositor or any Affiliate of any of the foregoing Persons.
"Owner Trustee" means Wilmington Trust Company, not in its individual
capacity but solely as Owner Trustee under the Trust Agreement, or any successor
Owner Trustee under the Trust Agreement.
"Paying Agent" means (unless the Paying Agent is the Servicer) a
Person that meets the eligibility standards for the Indenture Trustee specified
in Section 6.11 hereof and is authorized by the Issuer to make payments to and
distributions from the Collection Account and the Distribution Account,
including payment of principal of or interest on the Notes on behalf of the
Issuer. The initial Paying Agent shall be the Servicer; provided that if the
Servicer is terminated as Paying Agent for any reason, the Indenture Trustee
shall be the Paying Agent until another Paying Agent is appointed by the
Noteholder Agent pursuant to Section 8.04 herein. The Indenture Trustee shall be
entitled to reasonable additional compensation for assuming the role of Paying
Agent.
"Payment Date" has the meaning set forth in the Sale and Servicing
Agreement.
"Percentage Interest" means, with respect to any Note and as of any
date of determination, the percentage equal to a fraction, the numerator of
which is the principal balance of such Note as of such date of determination and
the denominator of which is the Note Principal Balance.
"Person" has the meaning set forth in the Sale and Servicing
Agreement.
"Predecessor Note" means, with respect to any particular Note, every
previous Note evidencing all or a portion of the same debt as that evidenced by
such particular Note; and, for the purpose of this definition, any Note
authenticated and delivered under Section 2.04 hereof in lieu of a mutilated,
lost, destroyed or stolen Note shall be deemed to evidence the same debt as the
mutilated, lost, destroyed or stolen Note.
"Pricing Letter" means the pricing letter among the Issuer, the
Depositor, Option One and the Indenture Trustee, dated the date hereof and any
amendments thereto.
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"Proceeding" means any suit in equity, action at law or other judicial
or administrative proceeding.
"Record Date" has the meaning set forth in the Sale and Servicing
Agreement.
"Redemption Date" means in the case of a redemption of the Notes
pursuant to Section 10.01 hereof, the Payment Date specified by the Servicer
pursuant to such Section 10.01.
"Registered Holder" means the Person in the name of which a Note is
registered on the Note Register on the applicable Record Date.
"Revolving Period" has the meaning set forth in the Sale and Servicing
Agreement.
"Sale Agents" has the meaning assigned to such term in Section 5.11
hereof.
"Sale and Servicing Agreement" means the Sale and Servicing Agreement
dated as of October 1, 2005, among the Issuer, the Depositor, the Loan
Originator and Servicer, and the Indenture Trustee on behalf of the Noteholders.
"Servicer" means Option One Mortgage Corporation, in its capacity as
servicer under the Sale and Servicing Agreement, and any successor servicer
thereunder.
"State" means any one of the States of the United States of America or
the District of Columbia.
"Termination Price" has the meaning set forth in the Sale and
Servicing Agreement.
"Transfer Date" has the meaning set forth in the Sale and Servicing
Agreement.
"Trust Agreement" means the Trust Agreement dated as of September 21,
2005, between the Depositor and the Owner Trustee.
"Trust Certificate" has the meaning assigned to such term in Section
1.1 of the Trust Agreement.
"Trust Indenture Act" means the Trust Indenture Act of 1939 as in
force on the date hereof, unless otherwise specifically provided.
(b) Except as otherwise specified herein or as the context may
otherwise require, capitalized terms used but not otherwise defined herein have
the respective meanings set forth in the Sale and Servicing Agreement for all
purposes of this Indenture.
Section 1.02. Rules of Construction. Unless the context otherwise
requires:
(i) a term has the meaning assigned to it;
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(ii) an accounting term not otherwise defined has the meaning assigned
to it in accordance with GAAP;
(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 (as provided in such agreements) and includes (in
the case of agreements or instruments) references to all attachments
thereto and instruments incorporated therein; references to a Person are
also to its permitted successors and assigns.
ARTICLE II
GENERAL PROVISIONS WITH RESPECT TO THE NOTES
Section 2.01. Method of Issuance and Form of Notes.
(a) The Notes shall be designated generally as the "Option One Owner
Trust 2005-8 Mortgage-Backed Notes" of the Issuer. Each Note shall bear upon its
face the designation so selected for the Notes. All Notes shall be identical in
all respects except for the denominations thereof. All Notes issued under this
Indenture shall be in all respects equally and ratably entitled to the benefits
thereof without preference, priority or distinction on account of the actual
time or times of authentication and delivery, all in accordance with the terms
and provisions of this Indenture.
The Notes may be typewritten, printed, lithographed or engraved or
produced by any combination of these methods, all as determined by the officers
executing such Notes, as evidenced by their execution of such Notes.
Each Note shall be dated the date of its authentication.
The terms of the Notes shall be set forth in this Indenture.
The Notes shall be in definitive form and shall bear a legend
substantially in the form of Exhibit C attached hereto.
Section 2.02. Execution, Authentication, Delivery and Dating. The
Notes shall be executed on behalf of the Issuer by an Authorized Officer of the
Owner Trustee or the Administrator. The signature of any such Authorized Officer
on the Notes may be manual or facsimile.
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Notes bearing the manual or facsimile signature of individuals who
were at any time Authorized Officers of the Owner Trustee or the Administrator
shall bind the Issuer, 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.
Subject to the satisfaction of the conditions set forth in Section
2.08 hereof, the Indenture Trustee shall upon Issuer Order authenticate and
deliver the Notes.
The Notes that are authenticated and delivered by the Indenture
Trustee to or upon the order of the Issuer on the Closing Date shall be dated as
of such Closing Date. All other Notes that are authenticated after the Closing
Date for any other purpose under the Indenture shall be dated the date of their
authentication. The Notes shall be issued in such denominations as may be agreed
by the Issuer and the Noteholder Agent.
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.
Section 2.03. Registration; Registration of Transfer and Exchange. The
Issuer shall cause to be kept a register (the "Note Register") in which, subject
to such reasonable regulations as it may prescribe, the Issuer shall provide for
the registration of Notes and the registration of transfers of Notes. The
Indenture Trustee initially shall be the "Note Registrar" for the purpose of
registering Notes and transfers of Notes as herein provided. Upon any
resignation of any Note Registrar, the Issuer shall promptly appoint a successor
or, if it elects not to make such an appointment, assume the duties of the Note
Registrar.
If a Person other than the Indenture Trustee is appointed by the
Issuer as Note Registrar, the Issuer will give the Indenture Trustee prompt
written notice of the appointment of such Note Registrar and of the location,
and any change in the location, of the Note Register, and the Indenture Trustee
shall have the right to inspect the Note Register at all reasonable times and to
obtain copies thereof, and the Indenture Trustee shall have the right to rely
upon a certificate executed on behalf of the Note Registrar by an Executive
Officer thereof as to the names and addresses of the Noteholders and the
principal amounts and number of the Notes.
Upon surrender for registration of transfer of any Note at the office
or agency of the Issuer to be maintained as provided in Section 3.02 hereof, the
Issuer shall execute, and the Indenture Trustee shall authenticate and the
Noteholder shall obtain from the Indenture Trustee, in the name of the
designated transferee or transferees, one or more new Notes in any authorized
denominations, of a like aggregate Note Principal Balance.
At the option of the Holder, Notes may be exchanged for other Notes in
any authorized denominations, of a like aggregate principal amount, upon
surrender of the Notes to be exchanged at such office or agency. Whenever any
Notes are so surrendered for exchange, the Issuer shall execute, and the
Indenture Trustee shall authenticate and the Noteholder shall obtain
9
from the Indenture Trustee, the Notes which the Noteholder making the exchange
is entitled to receive.
All Notes issued upon any registration of transfer or exchange of
Notes shall be the valid obligations of the Issuer, evidencing the same debt,
and entitled to the same benefits under this Indenture, as the Notes surrendered
upon such registration of transfer or exchange.
Every Note presented or surrendered for registration of transfer or
exchange shall be duly endorsed by, or be accompanied by a written instrument of
transfer in the form attached to the form of Note attached as Exhibit A hereto
duly executed by the Holder thereof or such Holder's attorney duly authorized in
writing, with such signature guaranteed by an "eligible guarantor institution"
meeting the requirements of the Securities Transfer Agents' Medallion Program
("STAMP").
No service charge shall be made to a Noteholder for any registration
of transfer or exchange of Notes, but the Issuer may require payment of a sum
sufficient to cover any tax or other governmental charge that may be imposed in
connection with any registration of transfer or exchange of Notes, other than
exchanges pursuant to Section 9.05 hereof not involving any transfer.
The preceding provisions of this Section 2.03 notwithstanding, the
Issuer shall not be required to make, and the Note Registrar need not register,
transfers or exchanges of Notes selected for redemption or of any Note for a
period of 15 days preceding the due date for any payment with respect to such
Note.
Section 2.04. 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 Issuer and Indenture Trustee such
security or indemnity as may reasonably be required by it to hold the Issuer and
the Indenture Trustee, as applicable, harmless, then, in the absence of notice
to the Issuer, the Note Registrar or the Indenture Trustee that such Note has
been acquired by a bona fide purchaser, an Authorized Officer of the Owner
Trustee or the Administrator on behalf of the Issuer shall execute, and upon its
written 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, or shall have been called for redemption, instead of issuing a
replacement Note, the Issuer may pay such destroyed, lost or stolen Note when so
due or payable or upon the Redemption Date 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 Issuer shall be entitled to recover such
replacement Note (or such payment) from the Person to which it was delivered or
any Person taking such replacement Note from such Person to which such
replacement Note was delivered or any assignee of such Person, except a bona
fide purchaser, and the Issuer and the Indenture Trustee 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 Issuer or the Indenture Trustee in
connection therewith.
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Upon the issuance of any replacement Note under this Section 2.04, the
Issuer 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 2.04 in
replacement of any mutilated, destroyed, lost or stolen Note shall constitute an
original additional contractual obligation of the Issuer, 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 2.04 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 2.05. Persons Deemed Noteholders. Prior to due presentment for
registration of transfer of any Note, the Issuer, the Indenture Trustee and any
agent of the Issuer or the Indenture Trustee may treat the Person in the name of
which any Note is registered (as of the day of determination) as the Noteholder
for the purpose of receiving payments of principal of and interest, if any, on
such Note and for all other purposes whatsoever, whether or not such Note be
overdue, and none of the Issuer, the Indenture Trustee or any agent of the
Issuer or the Indenture Trustee shall be affected by notice to the contrary.
Section 2.06. Payment of Principal and/or Interest.
(a) The Notes shall accrue interest at the Note Interest Rate, and
such interest shall be payable on each Payment Date, subject to Section 3.01
hereof. Any installment of interest or principal, if any, payable on any Note
that is punctually paid or duly provided for by the Issuer on the applicable
Payment Date shall be paid to the Person in the name of which such Note (or one
or more Predecessor Notes) is registered on the next preceding Record Date based
on the Percentage Interest represented by its respective Note, without
preference or priority of any kind, and, except as otherwise provided in the
next succeeding sentence, shall be made by wire transfer of immediately
available funds to the account of such Noteholder, if such Noteholder shall own
of record Notes having a Percentage Interest of at least 20% and shall have so
notified the Paying Agent and the Indenture Trustee, and otherwise by check
mailed to the address of such Noteholder appearing in the Note Register no less
than five days preceding the related Record Date. The final installment of
principal payable with respect to such Note shall be payable as provided in
Section 2.06(b) below. The funds represented by any such checks returned
undelivered shall be held in accordance with Section 3.03 hereof.
(b) The principal of each Note shall be payable in installments on
each Payment Date as provided in Sections 5.01 and 5.02 of the Sale and
Servicing Agreement and Section 5.04(b) hereof. Notwithstanding the foregoing,
the entire unpaid principal amount of the Notes shall be due and payable, if not
previously paid, on the earlier of (i) the Maturity Date, (ii) the Redemption
Date, (iii) the Final Put Date and (iv) the date on which an Event of Default
shall have occurred and be continuing, if the Indenture Trustee or the Majority
Noteholders shall have
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declared the Notes to be immediately due and payable in the manner provided in
Section 5.02 hereof.
All principal payments on the Notes shall be made pro rata to the
Noteholders based on their respective Percentage Interests. The Paying Agent
shall notify the Person in the name of which a Note is registered at the close
of business on the Record Date preceding the Payment Date on which the Issuer
expects that the final installment of principal of and interest on such Note
will be paid. Such notice shall be mailed or transmitted by facsimile prior to
such final Payment Date and shall specify that such final installment 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 payment of such
installment. Notices in connection with redemptions of Notes shall be provided
to Noteholders as set forth in Section 10.02 hereof.
Section 2.07. 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 promptly be canceled by the Indenture Trustee. The Issuer may at any
time deliver to the Indenture Trustee for cancellation any Notes previously
authenticated and delivered hereunder which the Issuer may have acquired in any
manner whatsoever, and all Notes so delivered shall promptly be canceled by the
Indenture Trustee. No Notes shall be authenticated in lieu of or in exchange for
any Notes canceled as provided in this Section 2.07, except as expressly
permitted by this Indenture. All canceled 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 Issuer shall direct by an Issuer
Order that they be destroyed or returned to it; provided, however, that such
Issuer Order is timely and the Notes have not been previously disposed of by the
Indenture Trustee.
Section 2.08. Conditions Precedent to the Authentication of the Notes.
The Notes may be authenticated by the Indenture Trustee upon receipt by the
Indenture Trustee of the following:
(a) An Issuer Order authorizing authentication of such Notes by the
Indenture Trustee;
(b) All of the items of Collateral which are to be delivered pursuant
to the Basic Documents to the Indenture Trustee or its designee by the related
Closing Date shall have been delivered;
(c) An executed counterpart of each Basic Document;
(d) One or more Opinions of Counsel addressed to the Indenture Trustee
to the effect that:
(i) all conditions precedent provided for in this Indenture relating
to the authentication of the Notes have been complied with;
(ii) the Owner Trustee has power and authority to execute, deliver and
perform its obligations under the Trust Agreement;
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(iii) the Issuer has been duly formed, is validly existing as a
statutory trust under the laws of the State of Delaware, 12 Del. C. Section
3801 et seq., and has power, authority and legal right to execute and
deliver this Indenture, the Note Purchase Agreement, the Custodial
Agreement, the Administration Agreement and the Sale and Servicing
Agreement;
(iv) assuming due authorization, execution and delivery hereof by the
Indenture Trustee, the Indenture is a valid, legal and binding obligation
of the Issuer, enforceable in accordance with its terms, subject to
bankruptcy, insolvency, reorganization, arrangement, moratorium, fraudulent
or preferential conveyance and other similar laws of general application
affecting the rights of creditors generally and to general principles of
equity (regardless of whether such enforcement is considered in a
Proceeding in equity or at law);
(v) the Notes, when executed and authenticated as provided herein and
delivered against payment therefor, will be the valid, legal and binding
obligations of the Issuer pursuant to the terms of this Indenture, entitled
to the benefits of this Indenture, and will be enforceable in accordance
with their terms, subject to bankruptcy, insolvency, reorganization,
arrangement, moratorium, fraudulent or preferential conveyance and other
similar laws of general application affecting the rights of creditors
generally and to general principles of equity (regardless of whether such
enforcement is considered in a Proceeding in equity or at law);
(vi) Reserved;
(vii) this Indenture is not required to be qualified under the Trust
Indenture Act;
(viii) no authorization, approval or consent of any governmental body
having jurisdiction in the premises which has not been obtained by the
Issuer is required to be obtained by the Issuer for the valid issuance and
delivery of the Notes, except that no opinion need be expressed with
respect to any such authorizations, approvals or consents as may be
required under any state securities or "blue sky" laws; and
(ix) any other matters that the Indenture Trustee may reasonably
request.
(e) An Officer's Certificate complying with the requirements of
Section 11.01 hereof and stating that:
(i) the Issuer is not in Default under this Indenture and the issuance
of the Notes applied for will not result in any breach of any of the terms,
conditions or provisions of, or constitute a default under, the Trust
Agreement, any indenture, mortgage, deed of trust or other agreement or
instrument to which the Issuer is a party or by which it is bound, or any
order of any court or administrative agency entered in any Proceeding to
which the Issuer is a party or by which it may be bound or to which it may
be subject, and that all conditions precedent provided in this Indenture
relating to the authentication and delivery of the Notes applied for have
been complied with;
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(ii) the Issuer is the owner of all of the Loans, has not assigned any
interest or participation in the Loans (or, if any such interest or
participation has been assigned, it has been released) and has the right to
Grant all of the Loans to the Indenture Trustee;
(iii) the Issuer has Granted to the Indenture Trustee all of its
right, title and interest in and to the Collateral, and has delivered or
caused the same to be delivered to the Indenture Trustee; and
(iv) all conditions precedent provided for in this Indenture relating
to the authentication of the Notes have been complied with.
Section 2.09. Release of Collateral. (a) Except as otherwise provided
by the terms of the Basic Documents, the Indenture Trustee shall release the
Collateral from the lien of this Indenture only upon receipt of an Issuer
Request accompanied by the written consent of the Noteholder Agent in accordance
with the procedures set forth in the Custodial Agreement.
(b) The Indenture Trustee shall, if requested by the Servicer,
temporarily release or cause the Custodian temporarily to release to the
Servicer the Custodial Loan File pursuant to the provisions of Section 5(b) of
the Custodial Agreement upon compliance by the Servicer with the provisions
thereof; provided, however, that the Custodian's records shall indicate the
Issuer's pledge to the Indenture Trustee under the Indenture.
Section 2.10. Additional Note Principal Balance. In the event of
payment of Additional Note Principal Balance by the Noteholders as provided in
Section 2.01 (c) of the Sale and Servicing Agreement, each Noteholder shall, and
is hereby authorized to, record on the schedule attached to its Note the date
and amount of any Additional Note Principal Balance advanced by it, and each
repayment thereof; provided that failure to make any such recordation on such
schedule or any error in such schedule shall not adversely affect any
Noteholder's rights with respect to its Additional Note Principal Balance and
its right to receive interest payments in respect of the Additional Note
Principal Balance held by such Noteholder.
Absent manifest error, the Note Principal Balance of each Note as set
forth in the notations made by the related Noteholder on such Note shall be
binding upon the Indenture Trustee and the Issuer; provided that failure by a
Noteholder to make such recordation on its Note or any error in such notation
shall not adversely affect any Noteholder's rights with respect to its Note
Principal Balance and its right to receive principal and interest payments in
respect thereof.
Section 2.11. Tax Treatment. The Issuer has entered into this
Indenture, and the Notes will be issued, with the intention that for all
purposes, including federal, state and local income, single business and
franchise tax purposes, the Notes will qualify as indebtedness of the Issuer
secured by the Collateral. The Issuer, by entering into this Indenture, and each
Noteholder, by its acceptance of a Note, agrees to treat the Notes for all
purposes, including federal, state and local income, single business and
franchise tax purposes, as indebtedness of the Issuer. The Indenture Trustee
will have no responsibility for filing or preparing any tax returns.
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Section 2.12. Limitations on Transfer of the Notes.
(a) The Notes have not been and will not be registered under the
Securities Act and will not be listed on any exchange. No transfer of a Note
shall be made unless such transfer is made pursuant to an effective registration
statement under the Securities Act and all applicable state securities laws or
is exempt from the registration requirements under the Securities Act and such
state securities laws. In order to assure compliance with the Securities Act and
state securities laws, any transfer of a Note shall be made (A) in reliance on
Rule 144A under the Securities Act, in which case, the Indenture Trustee shall
require that the transferor deliver a certification substantially in the form of
Exhibit B-1 hereto and that the transferee deliver a certification substantially
in the form of Exhibit B-3 hereto, or (B) to an institutional "accredited
investor" within the meaning of Rule 501(a)(1), (2), (3) or (7) of Regulation D
under the Securities Act that is not a "qualified institutional buyer," in which
case the Indenture Trustee shall require that the transferee deliver a
certification substantially in the form of Exhibit B-2 hereto. The Indenture
Trustee shall not make any transfer or re-registration of the Notes if after
such transfer or re-registration, there would be more than five Noteholders.
Each Noteholder shall, by its acceptance of a Note, be deemed to have
represented and warranted that the number of ICA Owners with respect to all of
its Notes shall not exceed four.
(b) The Note Registrar shall not register the transfer of any Note
unless the Indenture Trustee has received a certificate from the transferee to
the effect that either (i) the transferee is not an employee benefit plan or
other retirement plan or arrangement subject to Title I of the Employee
Retirement Income Security Act of 1974, as amended, or Section 4975 of the
Internal Revenue Code of 1986, as amended (each, a "Plan"), and is not acting on
behalf of or investing the assets of a Plan or (ii) if the transferee is a Plan
or is acting on behalf of or investing the assets of a Plan, either that no
prohibited transaction within the meaning of Section 406(a) of ERISA or Section
4975 of the Code would occur upon the transfer of the Note or that the
conditions for exemptive relief under a prohibited transaction exemption has
been satisfied, including, but not limited to, Prohibited Transaction Class
Exemption ("PTCE") 96-23 (relating to transactions effected by an "in-house
asset manager"), PTCE 95-60 (relating to transactions involving insurance
company general accounts), PTCE 91-38 (relating to transactions involving bank
collective investment funds), PTCE 90-1 (relating to transactions involving
insurance company pooled separate accounts) and PTCE 84-14 (relating to
transactions effected by a "qualified professional asset manager").
ARTICLE III
COVENANTS
Section 3.01. Payment of Principal and/or Interest. The Issuer will
duly and punctually pay (or will cause to be paid duly and punctually) the
principal of and interest on the Notes in accordance with the terms of the
Notes, this Indenture and the Sale and Servicing Agreement. Amounts properly
withheld under the Code by any Person from a payment to any Noteholder of
interest and/or principal shall be considered as having been paid by the Issuer
to such Noteholder for all purposes of this Indenture. The Notes shall be
non-recourse obligations of the Issuer and shall be limited in right of payment
to amounts available from the Collateral, as provided in this Indenture. The
Issuer shall not otherwise be liable for payments on the Notes. If
15
any other provision of this Indenture shall be deemed to conflict with the
provisions of this Section 3.01, the provisions of this Section 3.01 shall
control.
Section 3.02. Maintenance of Office or Agency. The Indenture Trustee
shall maintain at the Corporate Trust Office an office or agency where Notes may
be surrendered for registration of transfer or exchange and where notices and
demands to or upon the Issuer in respect of the Notes and this Indenture may be
served. The Indenture Trustee shall give prompt written notice to the Issuer of
the location, and of any change in the location, of any such office or agency.
Section 3.03. Money for Payments to Be Held in Trust. As provided in
Section 8.02(a) and (b) hereof, all payments of amounts due and payable with
respect to any Notes that are to be made from amounts withdrawn from the
Distribution Account pursuant to Section 8.02(c) hereof shall be made on behalf
of the Issuer by the Indenture Trustee or by the Paying Agent, and no amounts so
withdrawn from the Distribution Account for payments of Notes shall be paid over
to the Issuer except as provided in this Section 3.03.
Any Paying Agent shall be appointed by the Noteholder Agent with
written notice thereof to the Indenture Trustee. The Issuer shall not appoint
any Paying Agent (other than the Indenture Trustee or Servicer) which is not, at
the time of such appointment, a Depository Institution.
The Issuer 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 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 notice of any Default by the Issuer
(or any other obligor upon the Notes) 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 Majority Noteholders or the Indenture Trustee,
forthwith pay to the Indenture Trustee all sums so held in trust by such
Paying Agent;
(iv) immediately resign as a 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; and
(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
16
therewith; provided, however, that with respect to withholding and
reporting requirements applicable to original issue discount (if any) on
the Notes, the Issuer shall have first provided the calculations pertaining
thereto to the Indenture Trustee.
The Issuer may at any time, for the purpose of obtaining the
satisfaction and discharge of this Indenture or for any other purpose, by Issuer
Order 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.
Subject to applicable laws with respect to escheat of funds or
abandoned property, 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 two years after such amount has become due and payable
shall be discharged from such trust and be paid to the Issuer on Issuer Request;
and the Holder of such Note shall thereafter, as an unsecured general creditor,
look only to the Issuer for payment thereof (but only to the extent of the
amounts so paid to the Issuer), and all liability of the Indenture Trustee or
such Paying Agent with respect to such trust money shall thereupon cease;
provided, however, that the Indenture Trustee or such Paying Agent, before being
required to make any such repayment, shall at the expense and direction of the
Issuer cause to be published, once in a newspaper of general circulation in the
City of New York customarily published in the English language on each Business
Day, notice that such money remains unclaimed and that, after a date specified
therein, which shall not be less than 30 days from the date of such publication,
any unclaimed balance of such money then remaining will be repaid to the Issuer.
The Indenture Trustee shall also adopt and employ any other reasonable means of
notification of such repayment (including, but not limited to, mailing notice of
such repayment to Noteholders whose Notes have been called but have not been
surrendered for redemption or whose right to or interest in moneys due and
payable but not claimed at the last address of record for each such Noteholder
determinable from the records of the Indenture Trustee or of any Paying Agent).
Any costs and expenses of the Indenture Trustee and the Paying Agent incurred in
the holding of such funds shall be charged against such funds. Monies so held
shall not bear interest.
Section 3.04. Existence. (a) Subject to subparagraph (b) of this
Section 3.04, the Issuer 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 Issuer hereunder is or becomes, organized under the
laws of any other State or of the United States of America, in which case the
Issuer 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 and the Collateral. The Issuer shall comply in all respects with the
covenants contained in the Trust Agreement, including without limitation, the
"special purpose entity" set forth in Section 4.1 thereof.
(b) Any successor to the Owner Trustee appointed pursuant to Section
10.2 of the Trust Agreement shall be the successor Owner Trustee under this
Indenture without the
17
execution or filing of any paper, instrument or further act to be done on the
part of the parties hereto.
(c) Upon any consolidation or merger of or other succession to the
Owner Trustee, the Person succeeding to the Owner Trustee under the Trust
Agreement may exercise every right and power of the Owner Trustee under this
Indenture with the same effect as if such Person had been named as the Owner
Trustee herein.
Section 3.05. Protection of Collateral. The Issuer will from time to
time execute and deliver all such reasonable 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) provide further assurance with respect to the Grant of all or any
portion of the Collateral;
(ii) maintain or preserve the lien and security interest (and the
priority thereof) of this Indenture or carry out more effectively the
purposes hereof;
(iii) perfect, publish notice of or protect the validity of any Grant
made or to be made by this Indenture;
(iv) enforce any rights with respect to the Collateral; and
(v) preserve and defend title to the Collateral and the rights of the
Indenture Trustee and the Noteholders in such Collateral against the claims
of all Persons and parties.
The Issuer hereby designates the Administrator, its agent and
attorney-in-fact to execute any financing statement, continuation statement or
other instrument required to be executed pursuant to this Section 3.05.
Section 3.06. Negative Covenants. Without the written consent of the
Majority Noteholders, so long as any Notes are Outstanding, the Issuer shall
not:
(i) except as expressly permitted by the Basic Documents, sell,
transfer, exchange or otherwise dispose of any of the properties or assets
of the Issuer, including those included in any part of the Trust Estate,
unless directed to do so by the Noteholders as permitted herein;
(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) engage in any business or activity other than as expressly
permitted by this Indenture and the other Basic Documents, other than in
connection with, or relating to,
18
the issuance of Notes pursuant to this Indenture, or amend this Indenture
as in effect on the Closing Date other than in accordance with Article IX
hereof;
(iv) issue any debt obligations except under this Indenture;
(v) incur or assume any indebtedness or guaranty any indebtedness of
any Person, except for such indebtedness as may be incurred by the Issuer
in connection with the issuance of the Notes pursuant to this Indenture;
(vi) dissolve or liquidate in whole or in part or merge or consolidate
with any other Person;
(vii) (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 except as may
expressly be permitted hereby, (B) except as provided in the Basic
Documents, permit any lien, charge, excise, claim, security interest,
mortgage or other encumbrance 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 (other than tax liens, mechanics' liens and
other liens that arise by operation of law, in each case, on any Mortgaged
Property and arising solely as a result of an action or omission of the
related Borrowers) or (C) except as provided in the Basic Documents, permit
any Person other than itself, the Owner Trustee and the Noteholders to have
any right, title or interest in the Trust Estate;
(viii) remove the Administrator without the prior written consent of
the Majority Noteholders; or
(ix) take any other action or fail to take any action which may cause
the Trust to be taxable as (a) an association pursuant to Section 7701 of
the Code and the corresponding regulations, or (b) as a taxable mortgage
pool pursuant to Section 7701(i) of the Code.
Section 3.07. Performance of Obligations; Servicing of Loans. (a) The
Issuer will not take any action and will use its best efforts not to permit any
action to be taken by others that would release any Person from any of such
Person's material covenants or obligations under any instrument or agreement
included in the Collateral or that would result in the amendment, hypothecation,
subordination, termination or discharge of, or impair the validity or
effectiveness of, any such instrument or agreement, except as expressly provided
in the Basic Documents or such other instrument or agreement.
(b) The Issuer may contract with or otherwise obtain the assistance of
other Persons (including, without limitation, the Administrator under the
Administration Agreement) to assist it in performing its duties under this
Indenture, and any performance of such duties by a Person identified to the
Indenture Trustee in an Officer's Certificate of the Issuer shall be deemed to
be action taken by the Issuer. Initially, the Issuer has contracted with the
Servicer and the Administrator to assist the Issuer in performing its duties
under this Indenture.
19
(c) The Issuer will punctually perform and observe all of its
obligations and agreements contained in this Indenture, in the Basic Documents
and in the instruments and agreements included in the Collateral, including but
not limited to (i) filing or causing to be filed all UCC financing statements
and continuation statements required to be filed by the terms of this Indenture
and the Sale and Servicing Agreement and (ii) recording or causing to be
recorded all Mortgages, Assignments of Mortgage, all intervening Assignments of
Mortgage and all assumption and modification agreements required to be recorded
by the terms of the Sale and Servicing Agreement, in accordance with and within
the time periods provided for in this Indenture and/or the Sale and Servicing
Agreement, as applicable. Except as otherwise expressly provided therein, the
Issuer shall not waive, amend, modify, supplement or terminate any Basic
Document or any provision thereof without the consent of the Indenture Trustee
and the Majority Noteholders.
(d) If the Issuer shall have knowledge of the occurrence of a
Servicing Event of Default, the Issuer shall promptly notify the Indenture
Trustee and the Noteholder Agent thereof, and shall specify in such notice the
action, if any, the Issuer is taking with respect to such default. If a
Servicing Event of Default shall arise from the failure of the Servicer to
perform any of its duties or obligations under the Sale and Servicing Agreement
with respect to the Loans, the Issuer shall take all reasonable steps available
to it to remedy such failure.
(e) Reserved.
(f) Upon any termination of the Servicer's rights and powers pursuant
to the Sale and Servicing Agreement, the Issuer shall promptly notify the
Indenture Trustee. As soon as a successor servicer is appointed, the Issuer
shall notify the Indenture Trustee of such appointment, specifying in such
notice the name and address of such successor servicer.
(g) Without derogating from the absolute nature of the assignment
granted to the Indenture Trustee under this Indenture or the rights of the
Indenture Trustee hereunder, the Issuer agrees (i) that it will not, without the
prior written consent of the Indenture Trustee, amend, modify, waive,
supplement, terminate or surrender, or agree to any amendment, modification,
supplement, termination, waiver or surrender of, the terms of any Collateral
(except to the extent otherwise permitted by the Sale and Servicing Agreement)
or the Basic Documents, or waive timely performance or observance by the
Servicer or the Depositor under the Sale and Servicing Agreement; and (ii) that
any such amendment shall not (A) increase or reduce in any manner the amount of,
or accelerate or delay the timing of, distributions that are required to be made
for the benefit of the Noteholders or (B) reduce the aforesaid percentage of the
Notes that is required to consent to any such amendment, without the consent of
Noteholders evidencing 100% Percentage Interests of the Outstanding Notes. If
any such amendment, modification, supplement or waiver shall so be consented to
by the Indenture Trustee, the Issuer agrees, promptly following a request by the
Indenture Trustee to do so, to execute and deliver, in its own name and at its
own expense, such agreements, instruments, consents and other documents as the
Indenture Trustee may deem necessary or appropriate in the circumstances.
Section 3.08. Reserved.
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Section 3.09. Annual Statement as to Compliance. So long as the Notes
are Outstanding, the Issuer will deliver to the Indenture Trustee, within 120
days after the end of each fiscal year of the Issuer (commencing with the fiscal
year beginning on May 1, 2006), an Officer's Certificate stating, as to the
Authorized Officer signing such Officer's Certificate, that:
(i) a review of the activities of the Issuer during such year and of
its performance under this Indenture has been made under such Authorized
Officer's supervision; and
(ii) to the best of such Authorized Officer's knowledge, based on such
review, the Issuer has materially complied with all conditions and
covenants under this Indenture throughout such year, or, if there has been
a default in its compliance with any such condition or covenant, specifying
each such default known to such Authorized Officer and the nature and
status thereof.
Section 3.10. Covenants of the Issuer. All covenants of the Issuer in
this Indenture are covenants of the Issuer and are not covenants of the Owner
Trustee. The Owner Trustee is, and any successor Owner Trustee under the Trust
Agreement will be, entering into this Indenture solely as Owner Trustee under
the Trust Agreement and not in its respective individual capacity, and in no
case whatsoever shall the Owner Trustee or any such successor Owner Trustee be
personally liable on, or for any loss in respect of, any of the statements,
representations, warranties or obligations of the Issuer hereunder, as to all of
which the parties hereto agree to look solely to the property of the Issuer.
Section 3.11. Servicer's Obligations. The Issuer shall cause the
Servicer to comply with the Sale and Servicing Agreement.
Section 3.12. Restricted Payments. The Issuer 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
Issuer or otherwise with respect to any ownership or equity interest or security
in or of the Issuer or to the Servicer, (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 Issuer may make, or cause to be made, (x)
distributions to the Servicer, the Indenture Trustee, the Owner Trustee and the
Noteholders and the holders of the Trust Certificates as contemplated by, and to
the extent funds are available for such purpose under, the Sale and Servicing
Agreement or the Trust Agreement and (y) payments to the Administrator pursuant
to Section 4 of the Administration Agreement. The Issuer will not, directly or
indirectly, make or cause to be made payments to or distributions from the
Distribution Account except in accordance with this Indenture and the Basic
Documents.
Section 3.13. Treatment of Notes as Debt for All Purposes. The Issuer
shall, and shall cause the Administrator to, treat the Notes as indebtedness for
all purposes.
Section 3.14. Notice of Events of Default. The Issuer shall give the
Indenture Trustee and the Noteholder Agent prompt written notice of each Event
of Default hereunder and
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each default on the part of the Servicer or the Loan Originator of their
respective obligations under any of the Basic Documents.
Section 3.15. Further Instruments and Acts. Upon request of the
Indenture Trustee, the Issuer 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.
ARTICLE IV
SATISFACTION AND DISCHARGE
Section 4.01. 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 and 3.10
hereof, (v) the rights, obligations and immunities of the Indenture Trustee
hereunder (including the rights of the Indenture Trustee under Section 6.07
hereof and the obligations of the Indenture Trustee under Section 4.02 hereof)
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 Issuer, shall
execute proper instruments satisfactory to it, and prepared and delivered to it
by the Issuer, acknowledging satisfaction and discharge of this Indenture with
respect to the Notes, when all of the following have occurred:
(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 2.04 hereof and (ii) Notes for the payment
of which money has theretofore been deposited in trust
or segregated and held in trust by the Issuer and
thereafter repaid to the Issuer or discharged from such
trust, as provided in Section 3.03 hereof) shall have
been delivered to the Indenture Trustee for
cancellation; or
(2) all Notes not theretofore delivered to the Indenture
Trustee for cancellation:
a. shall have become due and payable, or
b. are to be called for redemption within one year
under arrangements satisfactory to the Indenture
Trustee for the giving of notice of redemption by
the Indenture Trustee in the name, and at the
expense, of the Issuer,
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c. and the Issuer, in the case of clause a. or b.
above, has irrevocably deposited or caused
irrevocably to be 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 not theretofore
delivered to the Indenture Trustee for
cancellation when due to the applicable Maturity
Date or the Redemption Date (if Notes shall have
been called for redemption pursuant to Section
10.01 hereof), as the case may be; and
(B) the latest of (a) the payment in full of all outstanding
obligations under the Notes, (b) the payment in full of all unpaid
Trust Fees and Expenses and (c) the date on which the Issuer has paid
or caused to be paid all other sums payable hereunder by the Issuer;
and
(C) the Issuer shall have delivered to the Indenture Trustee an
Officer's Certificate and an Opinion of Counsel, each meeting the
applicable requirements of Section 11.01 hereof and, subject to
Section 11.02 hereof, each stating that all conditions precedent
herein provided for, relating to the satisfaction and discharge of
this Indenture with respect to the Notes, have been complied with.
Section 4.02. Application of Trust Money. All moneys deposited with
the Indenture Trustee pursuant to Sections 3.03 and 4.01 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 Paying Agent, as the
Indenture Trustee may determine, to the Noteholders for the payment or
redemption of which such moneys have been deposited with the Indenture Trustee,
of all sums due and to become due thereon for principal and/or interest; but
such moneys need not be segregated from other funds except to the extent
required herein or in the Sale and Servicing Agreement or required by law.
Section 4.03. Repayment of Moneys Held by Paying Agent. In connection
with the satisfaction and discharge of this Indenture with respect to the Notes,
all moneys then held by any Paying Agent other than the Indenture Trustee under
the provisions of this Indenture with respect to such Notes shall, upon demand
of the Issuer, be paid to the Indenture Trustee to be held and applied according
to Section 3.03 hereof and thereupon such Paying Agent shall be released from
all further liability with respect to such moneys.
ARTICLE V
REMEDIES
Section 5.01. Events of Default. "Events of Default" wherever used
herein, means any one of the following events (whatever the reason for such
Event of Default and
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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):
(a) notwithstanding any insufficiency of funds in the Distribution
Account for payment thereof on the related Payment Date, default in the payment
of any interest on any Note when the same becomes due and payable; or
(b) notwithstanding any insufficiency of funds in the Distribution
Account for payment thereof on the related Payment Date, default in the payment
of any installment of the Overcollateralization Shortfall of any Note (i) on any
Payment Date or (ii) on the Maturity Date, or, to the extent that there are
funds available in the Distribution Account therefor, default in the payment of
any installment of the principal of any Note from such available funds, as a
result of the occurrence of a Rapid Amortization Trigger; or
(c) the occurrence of a Servicer Event of Default; or
(d) default in the observance or performance of any covenant or
agreement of the Issuer made in any Basic Document to which it is a party (other
than a covenant or agreement, a default in the observance or performance of
which is elsewhere in this Section 5.01 specifically dealt with), or any
representation or warranty of the Issuer made in any Basic Document to which it
is a party or in any certificate or other writing delivered pursuant thereto or
in connection therewith proving to have been incorrect in any material respect
as of the time when the same shall have been made, and such default shall
continue or not be cured, or the circumstance or condition in respect of which
such misrepresentation 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 Issuer by the Indenture Trustee, or to
the Issuer, the Depositor and the Indenture Trustee by Noteholders evidencing at
least 25% Percentage Interests 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
(e) default in the observance or performance of any covenant or
agreement of the Depositor or the Loan Originator made in any Basic Document to
which it is a party or any representation or warranty of the Depositor (except
as otherwise expressly provided in the Basic Documents with respect to
representations and warranties regarding the Loans) or Loan Originator made in
any Basic Document to which they are a party, proving to have been incorrect in
any material respect as of the time when the same shall have been made, and such
default shall continue or not be cured, or the circumstance or condition in
respect of which such misrepresentation or warranty was incorrect shall not have
been eliminated or otherwise cured, for a period of 30 days (or five days in the
case of the failure of the Loan Originator to make a payment in respect of the
Transfer Obligation) after there shall have been given, by registered or
certified mail, to the Issuer and the Depositor by the Indenture Trustee, or to
the Issuer, the Depositor and the Indenture Trustee by Noteholders evidencing at
least 25% Percentage Interests 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
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(f) default in the observance or performance of any covenant or
agreement of the Loan Originator or any direct or indirect subsidiary (other
than any domestic or offshore entities established for the purpose of issuing
net interest margin securities) made in any repurchase agreement, loan and
security agreement or other similar credit facility agreement entered into by
the Loan Originator or any such subsidiary and any third party for borrowed
funds in excess of $30,000,000, including any default which entitles any party
to require acceleration or prepayment of any indebtedness thereunder; or
(g) the filing of a decree or order for relief by a court having
jurisdiction over the Issuer, the Depositor or the Loan Originator or all or
substantially all of the Collateral in an involuntary case under any applicable
federal or state bankruptcy, insolvency or other similar law now or hereafter in
effect, or the appointing of a receiver, liquidator, assignee, custodian,
trustee, sequestrator or similar official of the Issuer, the Depositor or the
Loan Originator or for all or substantially all of the Collateral, or the
ordering of the winding-up or liquidation of the affairs of the Issuer, the
Depositor or the Loan Originator, and such decree or order shall remain unstayed
and in effect for a period of 60 consecutive days; or
(h) the commencement by the Issuer, the Depositor or the Loan
Originator 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 Issuer, the Depositor or the Loan Originator to the entry of an order for
relief in an involuntary case under any such law, or the consent by the Issuer
to the appointment or taking possession by a receiver, liquidator, assignee,
custodian, trustee, sequestrator or similar official of the Issuer, the
Depositor or the Loan Originator or for any substantial part of the Collateral,
or the making by the Issuer, the Depositor or the Loan Originator of any general
assignment for the benefit of creditors, or the failure by the Issuer, the
Depositor or the Loan Originator generally to pay its respective debts as such
debts become due, or the taking of any action by the Issuer, the Depositor or
the Loan Originator in furtherance of any of the foregoing; or
(i) a Change of Control of the Loan Originator; or
(j) the Notes shall be Outstanding on the day after the end of the
Revolving Period.
The Loan Originator shall deliver to the Noteholders and Noteholder
Agent written notice of any Event of Default, as set forth under clauses (a)
through (j) above. The Issuer shall deliver to the Indenture Trustee, within
five days after the occurrence thereof, written notice in the form of an
Officer's Certificate of any event which with the giving of notice and the lapse
of time would become an Event of Default under clauses (d) or (e) above, the
status of such event and what action the Issuer or the Depositor, as applicable,
is taking or proposes to take with respect thereto.
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 direction or upon the prior written consent of the
Majority Noteholders, may declare all the Notes to be immediately due and
payable, by a notice in writing to the Issuer (and to the Indenture Trustee if
given by Noteholders), and upon any such declaration, the unpaid principal
amount of
25
such 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 has
been made and before a judgment or decree for payment of the moneys due has been
obtained by the Indenture Trustee as hereinafter in this Article V provided, the
Majority Noteholders, by written notice to the Issuer and the Indenture Trustee,
may rescind and annul such declaration and its consequences if:
(a) the Issuer has paid or deposited with the Indenture Trustee a sum
sufficient to pay:
1. all payments of principal of and/or interest on all Notes and all
other amounts that would then be due hereunder or upon such Notes if
the Event of Default giving rise to such acceleration had not
occurred; and
2. 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
(b) 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 hereof. No such rescission shall affect any
subsequent default or impair any right consequent thereto.
Section 5.03. Collection of Indebtedness and Suits for Enforcement by
Indenture Trustee. (a) The Issuer covenants that if (i) default is made in the
payment of any interest on any Note when the same becomes due and payable, and
such default continues for a period of five days, or (ii) default is made in the
payment of the principal of or any installment of the principal of any Note when
the same becomes due and payable, the Issuer will, upon demand of the Indenture
Trustee, pay to the Indenture Trustee, for the benefit of the Noteholders, the
whole amount then due and payable on such Notes for principal and/or interest,
with interest upon the overdue principal and, to the extent payment at such rate
of interest shall be legally enforceable, upon overdue installments of interest
at the rate borne by the Notes 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 Issuer shall fail forthwith to pay such amounts upon
such demand, the Indenture Trustee shall at the direction of the Majority
Noteholders, subject to Section 5.06(c) 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 Issuer or other
obligor upon such Notes and collect in the manner provided by law out of the
property of the Issuer or other obligor upon such Notes, wherever situated, the
moneys adjudged or decreed to be payable.
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(c) If an Event of Default occurs and is continuing, the Indenture
Trustee shall at the direction of the Majority Noteholders, as more particularly
provided in Section 5.04 hereof, subject to Section 5.06(c) hereof, proceed to
protect and enforce its rights and the rights of the Noteholders by such
appropriate Proceedings as the Indenture Trustee shall deem most effective to
protect and enforce any such rights, whether for the specific enforcement of any
covenant or agreement in this Indenture or in aid of the exercise of any power
granted herein, or to enforce any other proper remedy or legal or equitable
right vested in the Indenture Trustee by this Indenture or by law.
(d) In case there shall be pending, relative to the Issuer or any
other obligor upon the Notes or any Person having or claiming an ownership
interest in the Collateral, 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 Issuer or its property or such other obligor or Person,
or in case of any other comparable judicial Proceedings relative to the Issuer
or other obligor upon the Notes, or to the creditors or property of the Issuer
or such other obligor, the Indenture Trustee, irrespective of whether the
principal of any Notes shall then be due and payable as therein 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 5.03, 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/or interest owing and unpaid in respect of the Notes and to
file such other papers or documents as may be necessary or advisable in
order to have the claims of the Indenture Trustee (including any claim for
reasonable compensation to the Indenture Trustee, each predecessor
Indenture Trustee, and its 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 Noteholders in any election of a trustee, a standby trustee
or Person performing similar functions in any such Proceedings;
(iii) to collect and receive any moneys 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 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 Noteholders allowed in any judicial proceedings relative to
the Issuer, 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 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, to pay to
the Indenture Trustee such amounts as shall be sufficient to cover
reasonable compensation to the Indenture Trustee,
27
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 except as a result of negligence or bad faith.
(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 any plan of reorganization, arrangement, adjustment or
composition affecting the Notes or the rights of any Holder thereof or to
authorize the Indenture Trustee to vote in respect of the claim of any
Noteholder 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,
disbursements and compensation of the Indenture Trustee, each predecessor
Indenture Trustee and their respective agents, attorneys and counsel, shall be
for the ratable benefit of the Noteholders.
(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 Noteholders, 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, the Indenture Trustee, at the direction of the
Majority Noteholders shall, 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 Issuer and any other
obligor upon such Notes moneys adjudged due;
(ii) institute Proceedings from time to time for the complete or
partial foreclosure of this Indenture with respect to the Collateral;
(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 or the Noteholders; and
(iv) sell the Collateral or any portion thereof or rights or interest
therein in a commercially reasonable manner, 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 Collateral following an Event of Default, unless
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(A) the Holders of 100% Percentage Interests of the Outstanding Notes
consent thereto, (B) the proceeds of such sale or liquidation distributable
to the Noteholders are sufficient to discharge in full all amounts then due
and unpaid upon such Notes for principal and/or interest or (C) the
Indenture Trustee determines that the Collateral will not continue to
provide sufficient funds for the payment of principal of and interest on
the 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 Holders
of not less than 66-2/3% Percentage Interests of the Outstanding Notes. In
determining such sufficiency or insufficiency with respect to clause (B)
and (C) of this subsection (a)(iv), the Indenture Trustee may, but need
not, obtain and rely upon an opinion of an Independent investment banking
or accounting firm of national reputation as to the feasibility of such
proposed action and as to the sufficiency of the Collateral for such
purpose.
(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 following
order:
FIRST: in the following order of priority: (a) to the Indenture
Trustee, an amount equal to all unreimbursed Indenture Trustee Fees and
indemnities and any other amounts payable to the Indenture Trustee pursuant
to the Basic Documents and to the Indenture Trustee or Sale Agents, as
applicable, all reasonable fees and expenses incurred by them and their
agents and representatives in connection with the enforcement of the
remedies provided for in this Article V, (b) to the Custodian, an amount
equal to all unpaid Custodian Fees and indemnities and any other amounts
payable to the Custodian pursuant to the Basic Documents, (c) to the Owner
Trustee, an amount equal to all unreimbursed Owner Trustee Fees and
indemnities and any other amounts payable to the Owner Trustee pursuant to
the Basic Documents, and (d) to the Servicer, an amount equal to (i) all
unreimbursed Servicing Compensation and (ii) all unreimbursed
Nonrecoverable Servicing Advances;
SECOND: the Hedge Funding Requirement to the appropriate Hedging
Counterparties;
THIRD: to the Noteholders pro rata, all amounts in respect of interest
due and owing under the Notes;
FOURTH: to the Noteholders pro rata, all amounts in respect of unpaid
principal of the Notes;
FIFTH: to the Purchasers or any other Indemnified Party (as each such
term is defined in the Note Purchase Agreement), amounts in respect of
Issuer/Depositor Indemnities (as defined in the Trust Agreement) and to the
Majority Noteholders amounts in respect of Due Diligence Fees (as set forth
in Section 11.15 of the Sale and Servicing Agreement) until such amounts
are paid in full;
SIXTH: to the Owner Trustee, for any amounts to be distributed pro
rata to the holders of the Trust Certificates pursuant to the Trust
Agreement.
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The Indenture Trustee may fix a record date and payment date for any
payment to be made to the Noteholders pursuant to this Section 5.04. At least 15
days before such record date, the Indenture Trustee shall mail to each
Noteholder and the Issuer a notice that states the record date, the payment date
and the amount to be paid.
Section 5.05. Optional Preservation of the Collateral. If the Notes
have been declared to be due and payable under Section 5.02 hereof following an
Event of Default and such declaration and its consequences have not been
rescinded and annulled, the Indenture Trustee may, but need not, elect to
maintain possession of the Collateral. It is the desire of the parties hereto
and the Noteholders that there be at all times sufficient funds for the payment
of principal of and interest on the Notes, and the Indenture Trustee shall take
such desire into account when determining whether or not to maintain possession
of the Collateral. In determining whether to maintain possession of the
Collateral, the Indenture Trustee may, but need not, obtain and rely upon an
opinion of an Independent investment banking or accounting firm of national
reputation as to the feasibility of such proposed action and as to the
sufficiency of the Collateral for such purpose.
Section 5.06. Limitation of Suits. No Noteholder 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:
(a) such Noteholder has previously given written notice to the
Indenture Trustee of a continuing Event of Default;
(b) the Noteholders evidencing not less than 25% Percentage Interests
of the Outstanding Notes have made written request to the Indenture Trustee to
institute such Proceeding in respect of such Event of Default in its own name as
Indenture Trustee hereunder;
(c) such Noteholder or Noteholders have offered to the Indenture
Trustee reasonable indemnity against the costs, expenses and liabilities to be
incurred in complying with such request;
(d) the Indenture Trustee for 30 days after its receipt of such
notice, request and offer of indemnity has failed to institute such Proceeding;
and
(e) no direction inconsistent with such written request has been given
to the Indenture Trustee during such 30-day period by the Majority Noteholders.
It is understood and intended that no one or more Noteholders 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 Noteholders or to obtain or to seek to obtain priority or preference over
any other Noteholders or to enforce any right under this Indenture, except in
the manner herein provided.
In the event the Indenture Trustee shall receive conflicting or
inconsistent requests and indemnity from two or more groups of Noteholders,
neither of which evidences Percentage Interests of the Outstanding Notes greater
than 50%, the Indenture Trustee in its sole discretion may determine what
action, if any, shall be taken, notwithstanding any other
30
provisions of this Indenture and shall have no obligation or liability to any
such group of Noteholders for such action or inaction.
Section 5.07. Unconditional Rights of Noteholders to Receive Principal
and/or Interest. Notwithstanding any other provisions in this Indenture, any
Noteholder 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
applicable Maturity Date thereof expressed in such Note or in this Indenture
(or, in the case of redemption, on or after the Redemption Date) and to
institute suit for the enforcement of any such payment, and such right shall not
be impaired without the consent of such Noteholder.
Section 5.08. Restoration of Rights and Remedies. If the Indenture
Trustee or any Noteholder has instituted any Proceeding to enforce any right or
remedy under this Indenture and such Proceeding has been discontinued or
abandoned for any reason or has been determined adversely to the Indenture
Trustee or to such Noteholder, then and in every such case the Issuer, the
Indenture Trustee and the Noteholders shall, subject to any determination in
such Proceeding, be restored severally and respectively to their former
positions hereunder, and thereafter all rights and remedies of the Indenture
Trustee and the Noteholders shall continue as though no such Proceeding had been
instituted.
Section 5.09. Rights and Remedies Cumulative. No right or remedy
herein conferred upon or reserved to the Indenture Trustee or to the Noteholders
is intended to be exclusive of any other right or remedy, and every right and
remedy shall, to the extent permitted by law, be cumulative and in addition to
every other right and remedy given hereunder or now or hereafter existing at law
or in equity or otherwise. The assertion or employment of any right or remedy
hereunder, or otherwise, shall not prevent the concurrent assertion or
employment of any other appropriate right or remedy.
Section 5.10. Delay or Omission Not a Waiver. No delay or omission of
the Indenture Trustee or any Noteholder to exercise any right or remedy accruing
upon any Default or Event of Default shall impair any such right or remedy or
constitute a waiver of any such Default or 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 may be exercised from time to time, and
as often as may be deemed expedient, by the Indenture Trustee or by the
Noteholders, as the case may be.
Section 5.11. Control by Noteholders. The Majority Noteholders 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,
however, that:
(a) such direction shall not be in conflict with any rule of law or
with this Indenture;
(b) subject to the express terms of Section 5.04(a)(iv) hereof, any
direction to the Indenture Trustee to sell or liquidate the Collateral shall be
by Holders of Notes representing Percentage Interests of the Outstanding Notes
of not less than 100%;
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(c) if the conditions set forth in Section 5.05 hereof have been
satisfied and the Indenture Trustee elects to retain the Collateral pursuant to
such Section, then any direction to the Indenture Trustee by Holders of Notes
representing Percentage Interests of the Outstanding Notes of less than 100% to
sell or liquidate the Collateral shall be of no force and effect; and
(d) the Indenture Trustee may take any other action deemed proper by
the Indenture Trustee that is not inconsistent with such direction.
In connection with any sale of the Collateral in accordance with
paragraph (c) above, the Majority Noteholders may, in their sole discretion
appoint agents to effect the sale of the Collateral (such agents, "Sale
Agents"), which Sale Agents may be Affiliates of any Noteholder. The Sale Agents
shall be entitled to reasonable compensation in connection with such activities
from the proceeds of such sale.
Notwithstanding the rights of the Noteholders set forth in this
Section 5.11, subject to Section 6.01 hereof, the Indenture Trustee need not
take any action that it determines might involve it in liability or might
materially adversely affect the rights of any Noteholders not consenting to such
action.
Section 5.12. Waiver of Past Defaults. The Majority Noteholders may
waive any past Default or Event of Default and its consequences, except a
Default (a) in the payment of principal of or interest on any of the Notes or
(b) in respect of a covenant or provision hereof that cannot be modified or
amended without the consent of each Noteholder. In the case of any such waiver,
the Issuer, the Indenture Trustee and Noteholders shall be restored to their
former positions and rights hereunder, respectively; but no such waiver shall
extend to any subsequent or other Default or impair any right consequent
thereto.
Upon any such waiver, such Default shall cease to exist and be deemed
to have been cured and not to have occurred, and 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 Default or Event of Default or impair any right consequent thereto.
Section 5.13. Undertaking for Costs. All parties to this Indenture
agree, and each Noteholder by such Noteholder'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, 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 any Noteholder, or group of
Noteholders, in each case holding in the aggregate Percentage Interests of the
Outstanding Notes of more than 10% or (c) any suit instituted by any Noteholder
for the enforcement of the payment of principal of or interest on any Note on or
after
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the respective due dates expressed in such Note and in this Indenture (or, in
the case of redemption, on or after the Redemption Date).
Section 5.14. Waiver of Stay or Extension Laws. The Issuer covenants
(to the extent that it may lawfully do so) that it will not at any time insist
upon, 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 Issuer (to the extent that it may lawfully do so) hereby
expressly waives all benefit or advantage of any such law, and covenants that it
will not hinder, delay or impede the execution of any power herein granted to
the Indenture Trustee, but will suffer and permit the execution of every such
power as though no such law had been enacted.
Section 5.15. Action on Notes. The Indenture Trustee's right to seek
and recover judgment on the Notes or under this Indenture shall not be affected
by the seeking, obtaining or application of any other relief under or with
respect to this Indenture. Neither the lien of this Indenture nor any rights or
remedies of the Indenture Trustee or the Noteholders shall be impaired by the
recovery of any judgment by the Indenture Trustee against the Issuer or by the
levy of any execution under such judgment upon any portion of the Collateral or
upon any of the assets of the Issuer. Any money or property collected by the
Indenture Trustee shall be applied in accordance with Section 5.04(b) hereof.
Section 5.16. Performance and Enforcement of Certain Obligations.
(a) Promptly following a request from the Indenture Trustee to do so
and at the Administrator's expense, the Issuer shall take all such lawful action
as the Indenture Trustee may request to compel or secure the performance and
observance by the Loan Originator and the Servicer, as applicable, of each of
their obligations to the Issuer under or in connection with the Sale and
Servicing Agreement or the Loan Purchase and Contribution Agreement, and to
exercise any and all rights, remedies, powers and privileges lawfully available
to the Issuer under or in connection with the Sale and Servicing Agreement to
the extent and in the manner directed by the Indenture Trustee, including the
transmission of notices of default on the part of the Loan Originator or the
Servicer thereunder and the institution of legal or administrative actions or
proceedings to compel or secure performance by the Loan Originator or the
Servicer of each of their obligations under the Sale and Servicing Agreement and
the Loan Purchase and Contribution Agreement.
(b) If an Event of Default has occurred and is continuing, the
Indenture Trustee may, and at the direction (which direction shall be in writing
or by telephone, confirmed in writing promptly thereafter) of the Majority
Noteholders shall, subject to Section 5.06(c) exercise all rights, remedies,
powers, privileges and claims of the Issuer against the Loan Originator or the
Servicer under or in connection with the Sale and Servicing Agreement or the
Loan Purchase and Contribution Agreement, including the right or power to take
any action to compel or secure performance or observance by the Loan Originator
or the Servicer, as the case may be, of each of their obligations to the Issuer
thereunder and to give any consent, request, notice, direction, approval,
extension, or waiver under the Sale and Servicing Agreement, and any right of
the Issuer to take such action shall be suspended.
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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.
(b) Except during the continuance of an Event of Default:
(i) the Indenture Trustee shall undertake 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; provided, however, that the Indenture
Trustee shall examine the certificates and opinions to determine whether or
not they conform to the requirements of this Indenture to the extent
specifically set forth herein.
(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;
(iii) the Indenture Trustee shall not be liable with respect to any
action it takes or omits to take in good faith in accordance with a
direction received by it pursuant to Section 5.11 hereof; and
(iv) Reserved.
(d) Reserved.
(e) (e) The Indenture Trustee shall not be liable for interest on any
money received by it and held in a Trust Account except as may be provided in
the Sale and Servicing Agreement or as the Indenture Trustee may agree in
writing with the Issuer.
(f) Money held in trust by the Indenture Trustee shall be segregated
from other funds except to the extent permitted by law or the terms of this
Indenture or the Sale and Servicing Agreement.
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(g) No provision of this Indenture shall require the Indenture Trustee
to expend or risk its own funds or otherwise incur financial liability in the
performance of any of its duties hereunder or in the exercise of any of its
rights or powers, if it shall have reasonable grounds to believe that repayment
of such funds or adequate indemnity against such risk or liability is not
reasonably assured to it; provided, however, that the Indenture Trustee shall
not refuse or fail to perform any of its duties hereunder solely as a result of
nonpayment of its normal fees and expenses and provided, further, that nothing
in this Section 6.01(g) shall be construed to limit the exercise by the
Indenture Trustee of any right or remedy permitted under this Indenture or
otherwise in the event of the Issuer's failure to pay the Indenture Trustee's
fees and expenses pursuant to Section 6.07 hereof.
(h) 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 6.01.
(i) The Indenture Trustee shall not be required to take notice or be
deemed to have notice or knowledge of any Event of Default (other than an Event
of Default pursuant to Section 5.01 (a) or (b) hereof) unless a Responsible
Officer of the Indenture Trustee shall have received written notice thereof or
otherwise shall have actual knowledge thereof. In the absence of receipt of
notice or such knowledge, the Indenture Trustee may conclusively assume that
there is no Event of Default.
Section 6.02. Rights of Indenture Trustee. (a) The Indenture Trustee
may rely on 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 may execute any of the trusts or powers
hereunder or perform any duties hereunder either directly or by or through
agents or attorneys or a custodian or nominee.
(d) The Indenture Trustee shall not be liable for (i) 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 such action or omission by
the Indenture Trustee does not constitute willful misconduct, negligence or bad
faith; or (ii) any action or inaction on the part of the Custodian.
(e) The Indenture Trustee may consult with counsel, and the advice or
opinion of counsel with respect to legal matters relating to this Indenture and
the Notes shall be full and complete authorization and protection from liability
in respect to any action taken, omitted or suffered by it hereunder in good
faith and in accordance with the advice or opinion of such counsel.
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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 Issuer or its Affiliates with the same
rights it would have if it were not Indenture Trustee. Any Paying Agent, Note
Registrar, co-registrar or co-paying agent may do the same with like rights.
However, the Indenture Trustee must comply with Section 6.11 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 or the Notes, shall not be accountable for the
Issuer's use of the proceeds from the Notes, or responsible for any statement of
the Issuer in the 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. Notices of Default. If a Default occurs and is
continuing and if it is actually known to a Responsible Officer of the Indenture
Trustee, the Indenture Trustee shall mail to each Noteholder and each party to
the Master Disposition Confirmation Agreement notice of the Default within two
Business Days after it receives actual notice of such occurrence.
Section 6.06. Reports by Indenture Trustee to Holders. The Indenture
Trustee shall deliver to each Noteholder such information specifically requested
by each Noteholder and in the Indenture Trustee's possession and as may be
reasonably required to enable such Noteholder to prepare its federal and state
income tax returns.
Section 6.07. Compensation and Indemnity. As compensation for its
services hereunder, the Indenture Trustee shall be entitled to receive, on each
Payment Date, the Indenture Trustee's Fee pursuant to Section 8.02(c) hereof
(which compensation shall not be limited by any law on compensation of a trustee
of an express trust) and shall be entitled to reimbursement by the Servicer for
all reasonable out-of-pocket expenses incurred or made by it, including costs of
collection, in addition to the compensation for its services. Such expenses
shall include the reasonable compensation and expenses, disbursements and
advances of the Indenture Trustee's agents, counsel, accountants and experts.
The Issuer agrees to cause the Servicer to indemnify the Indenture Trustee, the
Paying Agent and their officers, directors, employees and agents against any and
all loss, liability or expense (including reasonable attorneys' fees) incurred
by it or them in connection with the administration of this trust and the
performance of its or their duties under the Basic Documents. The Indenture
Trustee shall notify the Issuer and the Servicer promptly of any claim for which
it may seek indemnity. Failure by the Indenture Trustee so to notify the Issuer
and the Servicer shall not relieve the Issuer or the Servicer of its or their
obligations hereunder. The Issuer shall, or shall cause the Servicer to, defend
any such claim; provided, however, that if the defendants with respect to any
such claim include the Issuer and/or the Servicer and the Indenture Trustee, and
the Indenture Trustee shall have reasonably concluded that there may be legal
defenses available to it which are different from or in addition to those
defenses available to the Issuer or the Servicer, as the case may be, the
Indenture Trustee shall have the right, at the expense of the Servicer, to
select separate counsel to assert such legal defenses and to otherwise defend
itself against such claim. Neither the Issuer nor the Servicer need 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.
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The Issuer'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 Indenture Trustee. When the Indenture Trustee
incurs expenses after the occurrence of a Default specified in Section 5.01(f)
or (g) hereof with respect to the Issuer, 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.
Notwithstanding anything in this Section 6.07 to the contrary, all
amounts due the Indenture Trustee hereunder shall be payable in the first
instance by the Servicer and, if not paid by the Servicer within 60 days after
payment is requested from the Servicer by the Indenture Trustee, in accordance
with the priorities set forth in Section 5.01 of the Sale and Servicing
Agreement.
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 Issuer. The Majority Noteholders may
remove the Indenture Trustee (with the consent of the Majority
Certificateholders, not to be unreasonably withheld) by so notifying the
Indenture Trustee and may appoint a successor Indenture Trustee; provided, that
all of the reasonable costs and expenses incurred by the Indenture Trustee in
connection with such removal shall be reimbursed to it prior to the
effectiveness of such removal. The Issuer shall remove the Indenture Trustee if:
(a) the Indenture Trustee fails to comply with Section 6.11 hereof;
(b) the Indenture Trustee is adjudged a bankrupt or insolvent;
(c) a receiver or other public officer takes charge of the Indenture
Trustee or its property; or
(d) the Indenture Trustee otherwise becomes incapable of acting.
If the Indenture Trustee resigns or is removed or if a vacancy exists
in the office of Indenture Trustee for any reason (the Indenture Trustee in such
event being referred to herein as the retiring Indenture Trustee), the Issuer
shall promptly appoint a successor Indenture Trustee.
A successor Indenture Trustee shall deliver a written acceptance of
its appointment to the retiring Indenture Trustee and to the Issuer. Thereupon
the resignation or removal of the retiring Indenture Trustee shall become
effective, and the successor Indenture Trustee shall have all the rights, powers
and duties of the Indenture Trustee under this Indenture. The successor
Indenture Trustee shall mail a notice of its succession to Noteholders. The
retiring Indenture Trustee shall promptly transfer all property held by it as
Indenture Trustee to the successor Indenture Trustee.
If a successor Indenture Trustee does not take office within 60 days
after the retiring Indenture Trustee resigns or is removed, the retiring
Indenture Trustee, the Issuer or the
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Majority Noteholders may petition any court of competent jurisdiction for the
appointment of a successor Indenture Trustee.
If the Indenture Trustee fails to comply with Section 6.11 hereof, any
Noteholder may petition any court of competent jurisdiction for the removal of
the Indenture Trustee and the appointment of a successor Indenture Trustee.
Notwithstanding the replacement of the Indenture Trustee pursuant to
this Section 6.08, the Issuer's and the Administrator's obligations under
Section 6.07 hereof 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 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; provided,
however, that such corporation or banking association shall otherwise be
qualified and eligible under Section 6.11 hereof. The Indenture Trustee shall
provide the Majority Noteholders prior written notice of any such transaction.
In case at the time such successor or successors by merger, conversion
or consolidation to the Indenture Trustee shall succeed to the trusts created by
this Indenture any of the Notes shall have been authenticated but not delivered,
any such successor to the Indenture Trustee may adopt the certificate of
authentication of any predecessor trustee, and deliver such Notes so
authenticated; and in case 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 anywhere in the Notes or in this Indenture
provided that the certificate of the Indenture Trustee shall have.
Section 6.10. Appointment of Co-Indenture Trustee or Separate
Indenture Trustee.
(a) Notwithstanding any other provisions of this Indenture, at any
time, for the purpose of meeting any legal requirement of any jurisdiction in
which any part of the Collateral may at the time be located, the Indenture
Trustee shall have the power and may execute and deliver all instruments to
appoint one or more Persons to act as a co-trustee or co-trustees, or separate
trustee or separate trustees, of all or any part of the Trust, and to vest in
such Person or Persons, in such capacity and for the benefit of the Noteholders,
such title to the Collateral, or any part hereof, and, subject to the other
provisions of this Section 6.10, 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 and no notice to
Noteholders of the appointment of any co-trustee or separate trustee shall be
required under Section 6.08 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:
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(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 Collateral or any portion thereof in
any such jurisdiction) shall be exercised and performed singly by such
separate trustee or co-trustee, but solely at the direction of the
Indenture Trustee;
(ii) no trustee hereunder shall be personally liable by reason of any
act or omission of any other trustee hereunder; and
(iii) the Indenture Trustee may at any time accept the resignation of
or remove any separate trustee or co-trustee.
(c) Any notice, request or other writing given to the Indenture
Trustee shall be deemed to have been given to each of the then separate trustees
and co-trustees, as effectively as if given to each of them. 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, jointly with the Indenture
Trustee, 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. The Indenture Trustee shall (i) have a
combined capital and surplus of at least $50,000,000 as set forth in its most
recent published annual report of condition or (ii) otherwise be acceptable in
writing to the Majority Noteholders.
ARTICLE VII
NOTEHOLDERS' LISTS AND REPORTS
Section 7.01. Issuer to Furnish Indenture Trustee Names and Addresses
of Noteholders. The Issuer will furnish or cause to be furnished to the
Indenture Trustee (a) not more than five days after the earlier of (i) each
Record Date and (ii) three months after the last Record Date, a list, in such
form as the Indenture Trustee may reasonably require, of the names and addresses
of the Noteholders as of such Record Date, (b) at such other times as the
Indenture
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Trustee may request in writing, within 30 days after receipt by the Issuer 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.
Section 7.02. Preservation of Information. The Indenture Trustee shall
preserve, in as current a form as is reasonably practicable, the names and
addresses of the Noteholders contained in the most recent list furnished to the
Indenture Trustee as provided in Section 7.01 hereof and the names and addresses
of Noteholders received by the Indenture Trustee in its capacity as Note
Registrar. The Indenture Trustee may destroy any list furnished to it as
provided in such Section 7.01 upon receipt of a new list so furnished.
Section 7.03. 144A Information.
(a) To permit compliance with the Securities Act in connection with
the sale of the Notes sold in reliance on Rule 144A, the Issuer shall furnish to
the Indenture Trustee the information required to be delivered under Rule
144A(d)(4) under the Securities Act, if the Issuer is neither a reporting
company under Section 13 or Section 15(d) of the United States Securities
Exchange Act of 1934, as amended, nor exempt from reporting pursuant to Rule
12g3-2(b) under the Exchange Act.
(b) The Indenture Trustee, to the extent it has any such information
in its possession, shall provide to any Noteholder and any prospective
transferee designated by any such Noteholder information regarding the Notes and
the Loans and such other information as shall be necessary to satisfy the
condition to eligibility set forth in Rule 144A(d)(4) under the Securities Act
for transfer of any such Note without registration thereof under the Securities
Act pursuant to the registration exemption provided by Rule 144A under the
Securities Act.
ARTICLE VIII
ACCOUNTS, DISBURSEMENTS AND RELEASES
Section 8.01. Collection of Money. General. 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 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 Collateral, 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 hereof.
Section 8.02. Trust Accounts; Distributions. (a) On or prior to the
Closing Date, the Issuer shall cause the Servicer to establish and maintain, in
the name of the Indenture Trustee for the benefit of the Noteholders, or on
behalf of the Owner Trustee for the benefit of the
40
Securityholders, the Trust Accounts as provided in the Sale and Servicing
Agreement. The Servicer shall deposit amounts into each of the Trust Accounts in
accordance with the terms hereof, the Sale and Servicing Agreement and the
Payment Statements.
(b) Collection Account. With respect to the Collection Account, the
Paying Agent shall make such withdrawals and distributions as specified in
Section 5.01(c)(1) of the Sale and Servicing Agreement in accordance with the
terms thereof.
(c) Distribution Account. With respect to the Distribution Account,
the Paying Agent shall make (i) such deposits as specified in Sections
5.01(c)(2)(A), 5.01(c)(2)(B), 5.05(e), 5.05(f), 5.05(g), and 5.05(h) of the Sale
and Servicing Agreement and (ii) such withdrawals and distributions as specified
in Section 5.01(c)(3) of the Sale and Servicing Agreement in accordance with the
terms thereof.
(d) Transfer Obligation Account. With respect to the Transfer
Obligation Account, the Paying Agent shall make (i) such deposits as specified
in Section 5.01(c)(3)(vii) of the Sale and Servicing Agreement and (ii) such
withdrawals and distributions as specified in Sections 5.05(d), 5.05(e),
5.05(f), 5.05(g), 5.05(h), and 5.05(i) of the Sale and Servicing Agreement in
accordance with the terms thereof.
(e) Reserved.
(f) Advance Account. With respect to the Advance Account, the Issuer
shall cause the Servicer to make such withdrawals specified in Section 2.06 of
the Sale and Servicing Agreement.
Section 8.03. General Provisions Regarding Trust Accounts. (a) All or
a portion of the funds in the Collection Account and the Transfer Obligation
Account shall be invested in Permitted Investments in accordance with the
provisions of Section 5.03(b) of the Sale and Servicing Agreement. The Indenture
Trustee will not make any investment of any funds or sell any investment held in
the Collection Account or the Transfer Obligation Account (other than in
Permitted Investments in accordance with Section 5.03(b) of the Sale and
Servicing Agreement) unless the security interest Granted and perfected in such
account will continue to be perfected in such investment or the proceeds of such
sale, in either case without any further action by any Person, as evidenced by
an Opinion of Counsel delivered to the Indenture Trustee by the Noteholder Agent
or the Servicer, as the case may be.
(b) Subject to Section 6.01 (c) hereof, the Indenture Trustee shall
not in any way be held liable by reason of any insufficiency in the Collection
Account or the Transfer Obligation Account resulting from any loss on any
Permitted Investments included therein.
(c) If (i) the Noteholder Agent or the Servicer, as the case may be,
shall have failed to give investment directions for any funds on deposit in the
Collection Account or the Transfer Obligation Account to the Indenture Trustee
by 2:00 p.m. New York City time (or such other time as may be agreed by the
Issuer and Indenture Trustee) on any Business Day unless the Servicer is then
acting as Paying Agent with respect to such accounts or (ii) a Default or Event
of Default shall have occurred and be continuing with respect to the Notes but
the Notes shall not
41
have been declared due and payable pursuant to Section 5.02 hereof or (iii) if
such Notes shall have been declared due and payable following an Event of
Default, amounts collected or receivable from the Collateral are being applied
in accordance with Section 5.05 hereof as if there had not been such a
declaration, then the Indenture Trustee shall, to the fullest extent
practicable, invest and reinvest funds in the Collection Account and the
Transfer Obligation Account in one or more Permitted Investments specified in
item (3) in the definition thereof.
Section 8.04. The Paying Agent. The initial Paying Agent shall be the
Servicer. The Paying Agent may be removed by the Noteholder Agent in its sole
discretion at any time. Upon removal of the Paying Agent, the Noteholder Agent
will appoint a successor Paying Agent within 30 days; provided that the
Indenture Trustee will be the Paying Agent until such successor is appointed.
Upon receiving written notice from the Noteholder Agent that the Paying Agent
has been terminated, the Indenture Trustee will immediately terminate the Paying
Agent's access to any and all Trust Accounts.
Section 8.05. Release of Collateral. (a) Subject to the payment of its
reasonable fees and expenses pursuant to Section 6.07 hereof, the Indenture
Trustee may, and when required by the provisions of this Indenture shall,
execute instruments acceptable to it and prepared and delivered to it by the
Issuer to release property from the lien of this Indenture, or convey the
Indenture Trustee's interest in the same, without recourse, representation or
warranty in a manner as provided in the Custodial Agreement and under
circumstances that are not inconsistent with the provisions of this Indenture
and the other Basic Documents. No party relying upon an instrument executed by
the Indenture Trustee as provided in this Article VIII shall be bound to
ascertain the Indenture Trustee's authority, inquire into the satisfaction of
any conditions precedent or see to the application of any moneys.
(b) The Indenture Trustee shall, at such time as there are no Notes
Outstanding and all sums due to the Noteholders (and their Affiliates), the
Noteholder Agent, the Sales Agents, the Indenture Trustee, the Owner Trustee and
the Custodian under the Basic Documents have been paid, release any remaining
portion of the Collateral that secured the Notes from the lien of this Indenture
and release to the Issuer or any other Person entitled thereto any funds then on
deposit in the Trust Accounts. At such time as the lien of this Indenture is
released, the Indenture Trustee shall cause a termination statement to be filed
in any jurisdiction where a UCC financing statement has been filed hereunder
with respect to the Collateral. The Indenture Trustee shall release property
from the lien of this Indenture pursuant to this subsection (b) only upon
receipt of an Issuer Request accompanied by an Officer's Certificate and an
Opinion of Counsel meeting the applicable requirements of Section 11.01 hereof.
Section 8.06. Opinion of Counsel. Except to the extent specifically
permitted by the terms of the Basic Documents, the Indenture Trustee shall
receive at least seven Business Days' prior notice when requested by the Issuer
to take any action pursuant to Section 8.05(a) hereof, accompanied by copies of
any instruments involved, and the Indenture Trustee may also require, as a
condition to such action, an Opinion of Counsel, in form and substance
satisfactory to the Indenture Trustee, from the Issuer concluding that all
conditions precedent to the taking of such action have been complied with and
such action will not materially and adversely impair the security for the Notes
or the rights of the Noteholders in contravention of the provisions of this
Indenture; provided, however, that such Opinion of Counsel shall not be required
to express an
42
opinion as to the fair value of the Collateral. Counsel rendering any such
opinion may rely, without independent investigation, on the accuracy and
validity of any certificate or other instrument delivered to the Indenture
Trustee in connection with any such action.
ARTICLE IX
SUPPLEMENTAL INDENTURES
Section 9.01. Supplemental Indentures Without the Consent of the
Noteholders. Without the consent of any Noteholder but with prior notice to the
Majority Noteholders, the Issuer and the Indenture Trustee, at any time and from
time to time, may enter into one or more indentures supplemental hereto, 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 Issuer, and the assumption by
any such successor of the covenants of the Issuer herein and in the Notes
contained;
(iii) to add to the covenants of the Issuer, for the benefit of the
Noteholders, or to surrender any right or power herein conferred upon the
Issuer;
(iv) to convey, transfer, assign, mortgage or pledge any property to
or with the Indenture Trustee;
(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 or to make any
other provisions with respect to matters or questions arising under this
Indenture or in any supplemental indenture; provided, however, that such
action shall not adversely affect the interests of the Noteholders; or
(vi) 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.
The Indenture Trustee is hereby authorized to join in the execution of
any such supplemental indenture and to make any further appropriate agreements
and stipulations that may be therein contained.
Section 9.02. Supplemental Indentures with Consent of Noteholders. The
Issuer and the Indenture Trustee, when authorized by an Issuer Order, also may,
with the consent of the Majority Noteholders, by Act of such Noteholders
delivered to the Issuer and the Indenture
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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 any Noteholder under this Indenture; provided, however, that no such
supplemental indenture shall, without the consent of each Noteholder affected
thereby:
(a) change the date of payment of any installment of principal of or
interest on any Note, or reduce the principal balance thereof, the interest rate
thereon or the Termination Price with respect thereto, change the provisions of
this Indenture relating to the application of collections on, or the proceeds of
the sale of, the Collateral 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 hereof, to the payment of any
such amount due on the Notes on or after the respective due dates thereof (or,
in the case of redemption, on or after the Redemption Date);
(b) reduce the Percentage Interest, 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;
(c) modify or alter the provisions of the definition of the term
"Outstanding" or "Percentage Interest";
(d) reduce the Percentage Interest of the Outstanding Notes, the
consent of the Holders of which is required to direct the Indenture Trustee to
direct the Issuer to sell or liquidate the Collateral pursuant to Section 5.04
hereof;
(e) 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 Outstanding Note affected thereby;
(f) 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 to adversely affect the rights of
the Noteholders to the benefit of any provisions for the mandatory redemption of
the Notes contained herein; or
(g) permit the creation of any lien ranking prior to or on a parity
with the lien of this Indenture with respect to any part of the Collateral or,
except as otherwise permitted or contemplated herein, terminate the lien of this
Indenture on any property at any time subject hereto or deprive any Noteholder
of the security provided by the lien of this Indenture.
The Indenture Trustee may in its discretion determine whether or not
any Notes would be affected by any supplemental indenture and any such
determination shall be conclusive
44
upon each Noteholder, whether theretofore or thereafter authenticated and
delivered hereunder. The Indenture Trustee shall not be liable for any such
determination made in good faith.
In connection with requesting the consent of the Noteholders pursuant
to this Section 9.02, the Indenture Trustee shall mail to the Noteholders to
which such amendment or supplemental indenture relates a notice prepared by the
Issuer setting forth in general terms the substance of 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.
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 such supplemental
indenture is authorized or permitted by this Indenture. The Indenture Trustee
may, but shall not be obligated to, enter into any such supplemental indenture
that affects the Indenture Trustee's own rights, duties, liabilities or
immunities under this Indenture or otherwise.
Section 9.04. Effect of Supplemental Indentures. Upon the execution of
any supplemental indenture pursuant to the provisions hereof, this Indenture
shall be and shall be deemed to be modified and amended in accordance therewith
with respect to the Notes affected thereby, and the respective rights,
limitations of rights, obligations, duties, liabilities and immunities under
this Indenture of the Indenture Trustee, the Issuer and the Noteholders shall
thereafter be determined, exercised and enforced hereunder subject in all
respects to such modifications and amendments, and all 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. 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 Issuer or the Indenture
Trustee shall so determine, new Notes so modified as to conform, in the opinion
of the Indenture Trustee and the Issuer, to any such supplemental indenture may
be prepared and executed by the Issuer and authenticated and delivered by the
Indenture Trustee in exchange for Outstanding Notes.
ARTICLE X
REDEMPTION OF NOTES; PUT OPTION
Section 10.01. Redemption. The Servicer may, at its option, effect an
early redemption of the Notes on any Payment Date on or after the Clean-up Call
Date. The Servicer shall effect such early termination in the manner specified
in and subject to the provisions of Section 10.02 of the Sale and Servicing
Agreement.
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The Servicer shall furnish the Indenture Trustee with notice of any
such redemption in order to facilitate the Indenture Trustee's compliance with
its obligation to notify the Noteholders of such redemption in accordance with
Section 10.02 hereof.
Section 10.02. Form of Redemption Notice. Notice of redemption under
Section 10.01 hereof shall be by first-class mail, postage prepaid, or by
facsimile mailed or transmitted not later than 10 days prior to the applicable
Redemption Date to each Noteholder, as of the close of business on the Record
Date preceding the applicable Redemption Date, at such Noteholder's address or
facsimile number appearing in the Note Register.
All notices of redemption shall state:
(i) the Redemption Date;
(ii) that on the Redemption Date Noteholders shall receive the Note
Redemption Amount; and
(iii) the place where such Notes are to be surrendered for payment of
the Termination Price (which shall be the office or agency of the Issuer to
be maintained as provided in Section 3.02 hereof).
Notice of redemption of the Notes shall be given by the Indenture
Trustee in the name of the Issuer and at the expense of the Servicer. Failure to
give to any Noteholder notice of redemption, or any defect therein, shall not
impair or affect the validity of the redemption of any other Note.
Section 10.03. Notes Payable on Redemption Date. The Notes to be
redeemed shall, following notice of redemption as required by Section 10.02
hereof (in the case of redemption pursuant to Section 10.01) hereof, on the
Redemption Date become due and payable at the Note Redemption Amount and (unless
the Issuer shall default in the payment of the Note Redemption Amount) no
interest shall accrue thereon for any period after the date to which accrued
interest is calculated for purposes of calculating the Note Redemption Amount.
The Issuer may not redeem the Notes unless all outstanding obligations under the
Notes have been paid in full.
Section 10.04. Put Option. The Majority Noteholders may, at their
option, put all or any portion of the Note Principal Balance of the Notes to the
Issuer on any date upon giving notice in the manner set forth in Section 10.05.
On each Put Date, the Issuer shall purchase the Note Principal Balance in the
manner specified in and subject to the provisions of Section 10.04 of the Sale
and Servicing Agreement.
Section 10.05. Form of Put Option Notice. Notice of exercise of a Put
Option under Section 10.04 hereof shall be given by the Majority Noteholders
(including to the Indenture Trustee) by first-class mail, postage prepaid, or by
facsimile mailed or transmitted not later than 5 days prior to the date on which
the Notes shall be repurchased by the Issuer.
Section 10.06. Notes Payable on Put Date. The Note Principal Balance
to be put to the Issuer shall, following notice of the exercise of the Put
Option as required by Section 10.05
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hereof, on the Put Date become due and payable at the Note Redemption Amount and
(unless the Issuer shall default in the payment of the Note Redemption Amount)
no interest shall accrue thereon for any period after the date to which accrued
interest is calculated for purposes of calculating the Note Redemption Amount.
ARTICLE XI
MISCELLANEOUS
Section 11.01. Compliance Certificates and Opinions, etc. Upon any
application or request by the Issuer to the Indenture Trustee to take any action
under any provision of this Indenture (except with respect to the Servicer's
servicing activity in the ordinary course of its business), the Issuer shall
furnish to the Indenture Trustee (i) an Officer's Certificate stating that all
conditions precedent, if any, provided for in this Indenture relating to the
proposed action have been complied with and (ii) an Opinion of Counsel stating
that in the opinion of such counsel all such conditions precedent, if any, have
been complied with.
Every certificate or opinion with respect to compliance with a
condition or covenant provided for in this Indenture shall include:
(1) 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;
(2) 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;
(3) 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; and
(4) a statement as to whether, in the opinion of each such
signatory, such condition or covenant has been complied
with.
Section 11.02. Form of Documents Delivered to Indenture Trustee. In
any case where several matters are required to be certified by, or covered by an
opinion of, any specified Person, it is not necessary that all such matters be
certified by, or covered by the opinion of, only one such Person, or that they
be so certified or covered by only one document, but one such Person may certify
or give an opinion with respect to some matters and one or more other such
Persons as to other matters, and any such Person may certify or give an opinion
as to such matters in one or several documents.
Any certificate or opinion of an Authorized Officer of the Issuer may
be based, insofar as it relates to legal matters, upon a certificate or opinion
of, or representations by,
47
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 such officer's 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 Servicer, the Loan
Originator, the Issuer or the Administrator, stating that the information with
respect to such factual matters is in the possession of the Servicer, the Loan
Originator, the Issuer or the Administrator, unless such counsel knows, or in
the exercise of reasonable care should know, that the certificate or opinion or
representations with respect to such matters are erroneous.
Where any Person is required to make, give or execute two or more
applications, requests, consents, certificates, statements, opinions or other
instruments under this Indenture, they may, but need not, be consolidated and
form one instrument.
Whenever in this Indenture, in connection with any application or
certificate or report to the Indenture Trustee, it is provided that the Issuer
shall deliver any document as a condition of the granting of such application,
or as evidence of the Issuer's compliance with any term hereof, it is intended
that the truth and accuracy, at the time of the granting of such application or
at the effective date of such certificate or report (as the case may be), of the
facts and opinions stated in such document shall in such case be conditions
precedent to the right of the Issuer to have such application granted or to the
sufficiency of such certificate or report. The foregoing shall not, however, be
construed to affect the Indenture Trustee's right to rely upon the truth and
accuracy of any statement or opinion contained in any such document as provided
in Article VI hereof.
Section 11.03. 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 Issuer. 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 favor of the Indenture
Trustee and the Issuer, if made in the manner provided in this Section 11.03.
(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 Register.
(d) Any request, demand, authorization, direction, notice, consent,
waiver or other action by any Noteholder shall bind the Holder of every Note
issued upon the registration thereof or in exchange therefor or in lieu thereof,
in respect of anything done, omitted or suffered
48
to be done by the Indenture Trustee or the Issuer in reliance thereon, whether
or not notation of such action is made upon such Note.
Section 11.04. Notices, etc., to Indenture Trustee and Issuer. 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 Issuer shall be
sufficient for every purpose hereunder if made, given, furnished or filed
in writing (including by facsimile) to or with the Indenture Trustee at
P.O. Box 98, Columbia, Maryland 21046, Attention: Option One Owner Trust
2005-8, with a copy to it at its Corporate Trust Office, or
(ii) the Issuer by the Indenture Trustee or by any Noteholder shall be
sufficient for every purpose hereunder if in writing and made, given,
furnished, filed or transmitted via facsimile to the Issuer at: Option One
Owner Trust 2005-8, c/o Wilmington Trust Company as Owner Trustee, One
Rodney Square North, 1100 North Market Street, Wilmington, Delaware 19890,
Attention: Corporate Trust Department, telecopy number: (302) 636-4144,
telephone number: (302) 636-1000, or at any other address or facsimile
number previously furnished in writing to the Indenture Trustee by the
Issuer or the Administrator. The Issuer shall promptly transmit any notice
received by it from the Noteholders to the Indenture Trustee.
Section 11.05. 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 his address as it appears on the Note Register, not later than the
latest date, and not earlier than the earliest date, prescribed for the giving
of such notice. In any case where notice to Noteholders is given by mail,
neither the failure to mail such notice nor any defect in any notice so mailed
to any 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 duly been given.
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.
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Section 11.06. Effect of Headings and Table of Contents. The Article
and Section headings herein and the Table of Contents are for convenience only
and shall not affect the construction hereof.
Section 11.07. Successors and Assigns. All covenants and agreements in
this Indenture and the Notes by the Issuer 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 11.08. 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 11.09. Benefits of Indenture. Nothing in this Indenture or in
the Notes, express or implied, shall give to any Person, other than the parties
hereto and their successors hereunder, and the Noteholders, and any other party
secured hereunder, and any other Person with an ownership interest in any part
of the Collateral, any benefit or any legal or equitable right, remedy or claim
under this Indenture.
Section 11.10. 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 11.11. 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, OTHER THAN SECTION 5-1401 OF THE GENERAL OBLIGATIONS
LAW, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE
DETERMINED IN ACCORDANCE WITH SUCH LAWS.
Section 11.12. 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 11.13. Recording of Indenture. If this Indenture is subject to
recording in any appropriate public recording offices, such recording is to be
effected by the Issuer and at its expense accompanied by an Opinion of Counsel
(which may be counsel to the Indenture Trustee or any other counsel reasonably
acceptable to the Indenture Trustee; provided, however, that the expense of such
Opinion of Counsel shall in no event be an expense of 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 11.14. Trust Obligation. No recourse may be taken, directly or
indirectly, with respect to the obligations of the Issuer, the Owner Trustee or
the Indenture Trustee on the
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Notes or, except as expressly provided for in Article VI hereof, under this
Indenture or any certificate or other writing delivered in connection herewith
or therewith, against (i) the Indenture Trustee or the Owner Trustee in its
individual capacity, (ii) any owner of a beneficial interest in the Issuer or
(iii) any partner, owner, beneficiary, agent, officer, director, employee, agent
or "control person" within the meaning of the Securities Act and the Exchange
Act, of the Indenture Trustee or the Owner Trustee in its individual capacity,
any holder of a beneficial interest in the Issuer, the Owner Trustee or the
Indenture Trustee or of any successor or assign of the Indenture Trustee or the
Owner Trustee in its individual capacity, except as any such Person may
expressly have 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 of the Issuer shall be fully liable,
to the extent provided by applicable law, for any unpaid consideration for
stock, unpaid capital contribution or failure to pay any installment or call
owing to such entity. For all purposes of this Indenture, in the performance of
any duties or obligations of the Issuer hereunder, the Owner Trustee shall be
subject to, and entitled to the benefits of, the terms and provisions of
Articles VI, VII and VIII of the Trust Agreement.
Section 11.15. 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 institute against the Depositor or the
Issuer, or join in any institution against the Depositor or the Issuer of, any
bankruptcy, reorganization, arrangement, insolvency or liquidation proceedings,
or other proceedings under any 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.
Section 11.16. Inspection. The Issuer agrees that, on reasonable prior
notice, it will permit any representative of the Indenture Trustee, during the
Issuer's normal business hours, to examine all the books of account, records,
reports and other papers of the Issuer, to make copies and extracts therefrom,
to cause such books to be audited by Independent certified public accountants,
and to discuss the Issuer's affairs, finances and accounts with the Issuer's
officers, employees, and Independent certified public accountants, all at such
reasonable times and as often as may reasonably be requested and at the expense
of the Servicer. The Indenture Trustee shall and shall cause its representatives
to hold in confidence all such information except to the extent disclosure may
be required by 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 11.17. Third Party Beneficiary. The Noteholders and Noteholder
Agent shall be third-party beneficiaries to the provisions of this Indenture,
and shall be entitled to rely upon and directly enforce such provisions of this
Indenture as if parties hereto.
Section 11.18. Limitation on Liability. 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 Option One Owner Trust 2005-8, 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 Issuer 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 Issuer, (c) nothing herein contained shall
51
be construed as creating any liability on 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 Issuer or be liable for the
breach or failure of any obligation, representation, warranty or covenant made
or undertaken by the Issuer under this Indenture or any other related documents.
52
IN WITNESS WHEREOF, the Issuer and the Indenture Trustee have caused
this Indenture to be duly executed by their respective officers, thereunto duly
authorized and duly attested, all as of the day and year first above written.
OPTION ONE OWNER TRUST 2005-8
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
WELLS FARGO BANK, N.A., as Indenture
Trustee
By: /s/ Reid Denny
------------------------------------
Name: Reid Denny
Title: Vice President
STATE OF DELAWARE )
) ss.:
COUNTY OF NEW CASTLE )
BEFORE ME, the undersigned authority, a Notary Public in and for said
county and state, on this day personally appeared ___________________, known to
me to be the person and officer whose name is subscribed to the foregoing
instrument and acknowledged to me that the same was the act of the said
Wilmington Trust Company, a Delaware banking corporation, not in its individual
capacity, but solely as Owner Trustee on behalf of OPTION ONE OWNER TRUST
2005-8, a Delaware statutory trust, and that such person executed the same as
the act of said statutory trust for the purpose and consideration therein
expressed, and in the capacities therein stated.
GIVEN UNDER MY HAND AND SEAL OF OFFICE, this ____ day of October,
2005.
----------------------------------------
Notary Public
(Seal)
My commission expires:
- ------------------------------------
STATE OF _________________ )
)ss.:
COUNTY OF ________________ )
BEFORE ME, the undersigned authority, a Notary Public in and for said
county and state, on this day personally appeared ____________________________,
known to me to be the person and officer whose name is subscribed to the
foregoing instrument and acknowledged to me that the same was the act of WELLS
FARGO BANK, N.A., and that such person executed the same as the act of said
corporation for the purpose and consideration therein stated.
GIVEN UNDER MY HAND AND SEAL OF OFFICE, this ____ day of October, 2005.
----------------------------------------
Notary Public
(Seal)
My commission expires:
- ------------------------------------
EXHIBIT A
FORM OF NOTE
THE OUTSTANDING PRINCIPAL AMOUNT OF THIS NOTE AT ANY TIME MAY BE LESS THAN THE
MAXIMUM NOTE PRINCIPAL BALANCE SHOWN ON THE FACE HEREOF. ANY PURCHASER OF THIS
NOTE MAY ASCERTAIN THE OUTSTANDING PRINCIPAL AMOUNT HEREOF BY INQUIRY OF THE
INDENTURE TRUSTEE.
THIS NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED
(THE "1933 ACT"), OR ANY STATE SECURITIES LAWS. NEITHER THIS NOTE NOR ANY
INTEREST OR PARTICIPATION HEREIN MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED,
PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH
REGISTRATION, UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO,
REGISTRATION.
THE HOLDER OF THIS NOTE BY ITS ACCEPTANCE HEREOF AGREES TO OFFER, SELL OR
OTHERWISE TRANSFER SUCH NOTE ONLY (A) PURSUANT TO A REGISTRATION STATEMENT WHICH
HAS BEEN DECLARED EFFECTIVE UNDER THE 1933 ACT, (B) FOR SO LONG AS THIS NOTE IS
ELIGIBLE FOR RESALE PURSUANT TO RULE 144A UNDER THE 1933 ACT, TO A PERSON IT
REASONABLY BELIEVES IS A "QUALIFIED INSTITUTIONAL BUYER" AS DEFINED IN RULE 144A
UNDER THE 1933 ACT THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A
QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE TRANSFER IS BEING
MADE IN RELIANCE ON RULE 144A OR (C) TO AN INSTITUTIONAL "ACCREDITED INVESTOR"
WITHIN THE MEANING OF SUBPARAGRAPH (A)(1), (2),(3) OR (7) OF RULE 501 UNDER THE
1933 ACT THAT IS ACQUIRING THE NOTE FOR ITS OWN ACCOUNT, OR FOR THE ACCOUNT OF
SUCH AN INSTITUTIONAL "ACCREDITED INVESTOR," FOR INVESTMENT PURPOSES AND NOT
WITH A VIEW TO, OR FOR OFFER OR SALE IN CONNECTION WITH, ANY DISTRIBUTION IN
VIOLATION OF THE 1933 ACT, IN EACH CASE IN COMPLIANCE WITH THE REQUIREMENTS OF
THE INDENTURE AND APPLICABLE STATE SECURITIES LAWS.
THIS NOTE MAY NOT BE TRANSFERRED UNLESS THE INDENTURE TRUSTEE HAS RECEIVED A
CERTIFICATE FROM THE TRANSFEREE TO THE EFFECT THAT EITHER (I) THE TRANSFEREE IS
NOT AN EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT PLAN OR ARRANGEMENT SUBJECT TO
TITLE I OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED, OR
SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (EACH, A "PLAN"),
AND IS NOT ACTING ON BEHALF OF OR INVESTING THE ASSETS OF A PLAN OR (II) IF THE
TRANSFEREE IS A PLAN OR IS ACTING ON BEHALF OF OR INVESTING THE ASSETS OF A
PLAN, EITHER THAT NO PROHIBITED TRANSACTION WITHIN THE MEANING OF SECTION 406(A)
OF
A-1
ERISA OR SECTION 4975 OF THE CODE WOULD OCCUR UPON THE TRANSFER OF THE NOTE OR
THAT THE CONDITIONS FOR EXEMPTIVE RELIEF UNDER A PROHIBITED TRANSACTION
EXEMPTION HAS BEEN SATISFIED INCLUDING BUT NOT LIMITED TO, PROHIBITED
TRANSACTION CLASS EXEMPTION ("PTCE") 96-23 (RELATING TO TRANSACTIONS EFFECTED BY
AN "IN-HOUSE ASSET MANAGER"), PTCE 95-60 (RELATING TO TRANSACTIONS INVOLVING
INSURANCE COMPANY GENERAL ACCOUNTS), PTCE 91-38 (RELATING TO TRANSACTIONS
INVOLVING BANK COLLECTIVE INVESTMENT FUNDS), PTCE 90-1 (RELATING TO TRANSACTIONS
INVOLVING INSURANCE COMPANY POOLED SEPARATE ACCOUNTS) AND PTCE 84-14 (RELATING
TO TRANSACTIONS EFFECTED BY A "QUALIFIED PROFESSIONAL ASSET MANAGER").
A-2
Maximum Note Principal Balance: $__________
Initial Percentage Interest: _______%
No. _______
OPTION ONE OWNER TRUST 2005-8
MORTGAGE-BACKED NOTES
OPTION ONE OWNER TRUST 2005-8, a Delaware statutory trust (the
"Issuer"), for value received, hereby promises to pay to _____________________,
or registered assigns (the "Noteholder"), the principal sum of ________________
($________________) or so much thereof as may be advanced and outstanding
hereunder and to pay interest on such principal sum or such part thereof as
shall remain unpaid from time to time, at the rate and at the times provided in
the Sale and Servicing Agreement and the Indenture. Principal of this Note is
payable on each Payment Date in an amount equal to the result obtained by
multiplying (i) the Percentage Interest of this Note by (ii) the principal
amount distributed in respect of such Payment Date.
The Outstanding Note Principal Balance of this Note bears interest at
the Note Interest Rate. On each Payment Date amounts in respect of interest on
this Note will be paid in an amount equal to the result obtained by multiplying
(i) the Percentage Interest of this Note by (ii) the aggregate amount paid in
respect of interest on the Notes with respect to such Payment Date.
Capitalized terms used but not defined herein have the meanings set
forth in the Indenture (the "Indenture"), dated as of October 1, 2005 between
the Issuer and Wells Fargo Bank, N.A., as Indenture Trustee (the "Indenture
Trustee") or, if not defined therein, the Sale and Servicing Agreement (the
"Sale and Servicing Agreement"), dated as of October 1, 2005 among the Issuer,
the Depositor, the Loan Originator and Servicer, and the Indenture Trustee on
behalf of the Noteholders.
By its acceptance of this Note, each Noteholder covenants and agrees,
until the earlier of (a) the termination of the Revolving Period and (b) the
Maturity Date, on each Transfer Date to advance amounts in respect of Additional
Note Principal Balance hereunder to the Issuer, subject to and in accordance
with the terms of the Indenture, the Sale and Servicing Agreement and the Note
Purchase Agreement.
In the event of an advance of Additional Note Principal Balance by the
Noteholders as provided in Section 2.01(c) of the Sale and Servicing Agreement,
each Noteholder shall, and is hereby authorized to, record on the schedule
attached to its Note the date and amount of any Additional Note Principal
Balance advanced by it, and each repayment thereof; provided that failure to
make any such recordation on such schedule or any error in such schedule shall
not adversely affect any Noteholder's rights with respect to its Additional Note
Principal Balance and its right to receive interest payments in respect of the
Additional Note Principal Balance held by such Noteholder.
A-3
Absent manifest error, the Note Principal Balance of each Note as set
forth in the notations made by the related Noteholder on such Note shall be
binding upon the Indenture Trustee and the Issuer; provided that failure by a
Noteholder to make such recordation on its Note or any error in such notation
shall not adversely affect any Noteholder's rights with respect to its Note
Principal Balance and its right to receive principal and interest payments in
respect thereof.
The Servicer may, at its option, effect an early redemption of the
Notes for an amount equal to the Note Redemption Amount on any Payment Date on
or after the Clean-up Call Date. The Servicer shall effect such early
termination by providing notice thereof to the Indenture Trustee and Owner
Trustee and by purchasing all of the Loans at a purchase price, payable in cash,
equal to the Termination Price.
Reference is hereby made to the further provisions of this Note set
forth on the reverse hereof, which further provisions shall for all purposes
have the same effect as if set forth at this place.
The statements in the legend set forth above are an integral part of
the terms of this Note and by acceptance hereof each Holder of this Note agrees
to be subject to and bound by the terms and provisions set forth in such legend.
Unless the Certificate of authentication hereon shall have been
executed by an authorized officer of the Indenture Trustee, by manual signature,
this Note shall not entitle the Noteholder hereof to any benefit under the
Indenture or the Sale and Servicing Agreement and/or be valid for any purpose.
THIS NOTE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE
LAWS OF THE STATE OF NEW YORK APPLICABLE TO CONTRACTS MADE AND PERFORMED WITHIN
THE STATE OF NEW YORK AND WITHOUT GIVING EFFECT TO THE CONFLICT OF LAW
PROVISIONS THEREOF OTHER THAN SECTION 5-1401 OF THE GENERAL OBLIGATIONS LAW.
A-4
IN WITNESS WHEREOF, the Issuer has caused this instrument to be
signed, manually or in facsimile, by its Authorized Officer, as of the date set
forth below.
Date: October ____, 2005
OPTION ONE OWNER TRUST 2005-8
By: Wilmington Trust Company, not in its
individual capacity but solely as
Owner Trustee under the Trust
Agreement
By:
------------------------------------
Authorized Signatory
INDENTURE TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Notes designated above and referred to in the
within-mentioned Indenture.
Date: October ____, 2005
WELLS FARGO BANK, N.A., not in its
individual capacity but solely as
Indenture Trustee
By:
------------------------------------
Authorized Signatory
A-5
[Reverse of Note]
This Note is one of the duly authorized Notes of the Issuer,
designated as its Mortgage-Backed Notes (herein called the "Notes"), all issued
under the Indenture. Reference is hereby made to the Indenture and all
indentures supplemental thereto, and the Sale and Servicing Agreement for a
statement of the respective rights and obligations thereunder of the Issuer, the
Indenture Trustee and the Noteholders. To the extent that any provision of this
Note contradicts or is inconsistent with the provisions of the Indenture or the
Sale and Servicing Agreement, the provisions of the Indenture or the Sale and
Servicing Agreement, as applicable, shall control and supersede such
contradictory or inconsistent provision herein. The Notes are subject to all
terms of the Indenture and the Sale and Servicing Agreement.
The principal of and interest on this Note are payable in such coin or
currency of the United States of America as at the time of payment is legal
tender for payment of public and private debts. All payments made by the Issuer
with respect to this Note shall be applied in accordance with the Indenture and
the Sale and Servicing Agreement.
The entire unpaid principal amount of this Note shall be due and
payable on the earlier of the Maturity Date, the Redemption Date and the Final
Put Date, if any, pursuant to Articles X of the Sale and Servicing Agreement and
the Indenture. Notwithstanding the foregoing, the entire unpaid principal amount
of the Notes shall be due and payable on the date on which an Event of Default
shall have occurred and be continuing and the Indenture Trustee, at the
direction or upon the prior written consent of the Majority Noteholders, has
declared the Notes to be immediately due and payable in the manner provided in
Section 5.02 of the Indenture. All principal payments on the Notes shall be made
pro rata to the Noteholders entitled thereto.
The Collateral secures this Note and all other Notes equally and
ratably without prejudice, priority or distinction between any Note and any
other Note. The Notes are non-recourse obligations of the Issuer and are limited
in right of payment to amounts available from the Collateral, as provided in the
Indenture. The Issuer shall not otherwise be liable for payments on the Notes,
and none of the owners, agents, officers, directors, employees, or successors or
assigns of the Issuer shall be personally liable for any amounts payable, or
performance due, under the Notes or the Indenture.
Any installment of interest or principal on this Note shall be paid on
the applicable Payment Date to the Person in whose name this Note (or one or
more Predecessor Notes) is registered in the Note Register as of the close of
business on the related Record Date by wire transfer in immediately available
funds to the account specified in writing by the related Noteholder to the
extent provided by the Indenture and otherwise by check mailed to the
Noteholder.
Any reduction in the principal amount of this Note (or any one or more
Predecessor Notes) effected by any payments made on any Payment Date shall be
binding upon all future Holders of this Note and of any Note issued upon the
registration of transfer hereof or in exchange hereof or in lieu hereof, whether
or not noted hereon. Any increase in the principal
A-6
amount of this Note (or any one or more Predecessor Notes) effected by payments
to the Issuer of Additional Note Principal Balances shall be binding upon the
Issuer and shall inure to the benefit of all future Holders of this Note and of
any Note issued upon the registration of transfer hereof or in exchange hereof
or in lieu hereof, whether or not noted hereon.
As provided in the Indenture and subject to certain limitations set
forth therein, the transfer of this Note may be registered on the Note Register
upon surrender of this Note for registration of transfer at the office or agency
designated by the Issuer pursuant to the Indenture, duly endorsed by, or
accompanied by a written instrument of transfer in the form attached hereto duly
executed by, the Holder hereof or such Holder's attorney duly authorized in
writing, with such signature guaranteed by an "eligible guarantor institution"
meeting the requirements of the Securities Transfer Agent's Medallion Program
("STAMP"), and thereupon one or more new Notes of authorized denominations and
in the same aggregate principal amount will be issued to the designated
transferee or transferees. No service charge will be charged for any
registration of transfer or exchange of this Note, but the Issuer may require
the Noteholder to pay a sum sufficient to cover any tax or other governmental
charge that may be imposed in connection with any such registration of transfer
or exchange.
Each Noteholder, by acceptance of a Note or a beneficial interest in a
Note, covenants and agrees that no recourse may be taken, directly or
indirectly, with respect to the obligations of the Issuer, the Owner Trustee or
the Indenture Trustee on the Notes or under the Indenture or any certificate or
other writing delivered in connection therewith, against (i) the Indenture
Trustee or the Owner Trustee in its individual capacity, (ii) any owner of a
beneficial interest in the Issuer or (iii) any partner, owner, beneficiary,
agent, officer, director, employee or "control person" within the meaning of the
1933 Act and the Exchange Act of the Indenture Trustee or the Owner Trustee in
its individual capacity, any holder of a beneficial interest in the Issuer, the
Owner Trustee or the Indenture Trustee or of any successor or assign of the
Indenture Trustee or the Owner Trustee in its individual capacity, except as any
such Person may have expressly agreed and except that any such partner, owner or
beneficiary shall be fully liable, to the extent provided by applicable law, for
any unpaid consideration for stock, unpaid capital contribution or failure to
pay any installment or call owing to such entity.
Each Noteholder, by acceptance of a Note or a beneficial interest in a
Note, covenants and agrees by accepting the benefits of the Indenture that such
Noteholder will not at any time institute against the Issuer, or join in any
institution against the Issuer of, any bankruptcy, reorganization, arrangement,
insolvency or liquidation proceedings under any United States federal or state
bankruptcy or similar law in connection with any obligations relating to the
Notes or the Basic Documents.
The Issuer has entered into the Indenture and this Note is issued with
the intention that, for federal, state and local income, single business and
franchise tax purposes, the Notes will qualify as indebtedness of the Issuer
secured by the Collateral. Each Noteholder, by acceptance of a Note, agrees to
treat the Notes for federal, state and local income, single business and
franchise tax purposes as indebtedness of the Issuer. Each Noteholder, by its
acceptance of a Note, represents and warrants that the number of ICA Owners with
respect to all of its Notes shall not exceed four.
A-7
Prior to the due presentment for registration of transfer of this
Note, the Issuer, the Indenture Trustee and any agent of the Issuer or the
Indenture Trustee may treat the Person in whose name this Note (as of the day of
determination or as of such other date as may be specified in the Indenture) is
registered as the owner hereof for all purposes, whether or not this Note be
overdue, and none of the Issuer, the Indenture Trustee or any such agent shall
be affected by notice to the contrary.
The Indenture permits, with certain exceptions as therein provided,
the amendment thereof and the modification of the rights and obligations of the
Issuer and the rights of the Holders of the Notes under the Indenture at any
time by the Issuer with the consent of the Majority Noteholders. The Indenture
also contains provisions permitting the Noteholders representing specified
Percentage Interests of the Outstanding Notes, on behalf of all of the
Noteholders, to waive compliance by the Issuer with certain provisions of the
Indenture and certain past defaults under the Indenture and their consequences.
Any such consent or waiver by the Holder of this Note (or any one or more
Predecessor Notes) shall be conclusive and binding upon such Holder and upon all
future Holders of this Note and of any Note issued upon the registration of
transfer hereof or in exchange hereof or in lieu hereof whether or not notation
of such consent or waiver is made upon this Note. The Indenture also permits the
Indenture Trustee to amend or waive certain terms and conditions set forth in
the Indenture without the consent of any Noteholder.
The term "Issuer" as used in this Note includes any successor to the
Issuer under the Indenture.
The Notes are issuable only in registered form in denominations as
provided in the Indenture, subject to certain limitations therein set forth.
No reference herein to the Indenture and no provision of this Note or
of the Indenture shall alter or impair the obligation of the Issuer, which is
absolute and unconditional, to pay the principal of and interest on this Note at
the times, place and rate, and in the coin or currency herein prescribed.
Anything herein to the contrary notwithstanding, except as expressly
provided in the Basic Documents, none of the Issuer in its individual capacity,
the Owner Trustee in its individual capacity, any owner of a beneficial interest
in the Issuer, or any of their respective partners, beneficiaries, agents,
officers, directors, employees or successors or assigns shall be personally
liable for, nor shall recourse be had to any of them for, the payment of
principal of or interest on this Note or performance of, or omission to perform,
any of the covenants, obligations or indemnifications contained in the
Indenture. The Holder of this Note by its acceptance hereof agrees that, except
as expressly provided in the Basic Documents, in the case of an Event of Default
under the Indenture, the Holder shall have no claim against any of the foregoing
for any deficiency, loss or claim therefrom; provided, however, that nothing
contained herein shall be taken to prevent recourse to, and enforcement against,
the assets of the Issuer for any and all liabilities, obligations and
undertakings contained in the Indenture or in this Note.
A-8
ASSIGNMENT
Social Security or taxpayer I.D. or other identifying number of assignee:
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and
transfers unto:
________________________________________________________________________________
(name and address of assignee)
the within Note and all rights thereunder, and hereby irrevocably constitutes
and appoints, attorney, to transfer said Note on the books kept for registration
thereof, with full power of substitution in the premises.
Dated: */
----------------- --------------------------------------
Signature Guaranteed:
*/
--------------------------------------
- ----------
*/ NOTICE: The signature to this assignment must correspond with the name of
the registered owner as it appears on the face of the within Note in every
particular, without alteration, enlargement or any change whatever. Such
signature must be guaranteed by an "eligible guarantor institution" meeting
the requirements of STAMP.
A-9
Schedule to Note
dated as of October, 2005
of OPTION ONE OWNER TRUST 2005-8
Date of advance Amount of
of Additional advance of
Note Principal Additional Note Percentage Aggregate Note Note Principal
Balance Principal Balance Interest Principal Balance Balance of Note
- --------------- ----------------- ---------- ----------------- ----------------
100%
A-10
EXHIBIT B-1
FORM OF RULE 144A TRANSFEROR CERTIFICATE
Wells Fargo Bank, N.A.
Sixth Street and Marquette Avenue
Minneapolis, Minnesota 55479
Attention: Corporate Trust Services - Option One Owner Trust 2005-8
Re: Option One Owner Trust 2005-8
Reference is hereby made to the Indenture dated as of October 1, 2005 (the
"INDENTURE") between Option One Owner Trust 2005-8 (the "TRUST") and Wells Fargo
Bank, N.A. (the "INDENTURE TRUSTEE"). Capitalized terms used but not defined
herein shall have the meanings given to them in the Sale and Servicing Agreement
dated as of October 1, 2005 among the Trust, Option One Loan Warehouse
Corporation (the "DEPOSITOR"), Option One Mortgage Corporation (the "SERVICER"
and the "LOAN ORIGINATOR") and the Indenture Trustee.
The undersigned (the "TRANSFEROR") has requested a transfer of $__________
current principal balance Notes to [insert name of transferee].
In connection with such request, and in respect of such Notes, the
Transferor hereby certifies that such Notes are being transferred in accordance
with (i) the transfer restrictions set forth in the Indenture and the Notes and
(ii) Rule 144A under the Securities Act of 1933, as amended to a purchaser that
the Transferor reasonably believes is a "qualified institutional buyer" within
the meaning of Rule 144A purchasing for its own account or for the account of a
"qualified institutional buyer," which purchaser is aware that the sale to it is
being made in reliance upon Rule 144A, in a transaction meeting the requirements
of Rule 144A and in accordance with any applicable securities laws of any state
of the United States or any other applicable jurisdiction.
This certificate and the statements contained herein are made for your
benefit and the benefit of the Depositor.
----------------------------------------
[Name of Transferor]
By:
------------------------------------
Name:
----------------------------------
Title:
---------------------------------
Dated:
________, ________
B-1-1
EXHIBIT B-2
FORM OF TRANSFEREE CERTIFICATE FOR
INSTITUTIONAL ACCREDITED INVESTOR
Wells Fargo Bank, N.A.
Sixth Street and Marquette Avenue
Minneapolis, Minnesota 55479
Attention: Corporate Trust Services - Option One Owner Trust 2005-8
Re: Option One Owner Trust 2005-8
In connection with our proposed purchase of $ _________________ Note
Principal Balance Mortgage-Backed Notes (the "OFFERED NOTES") issued by Option
One Owner Trust 2005-8, we confirm that:
(1) We understand that the Offered Notes have not been, and will not be,
registered under the Securities Act of 1933, as amended (the "1933 ACT") or
any state securities laws, and may not be sold except as permitted in the
following sentence. We agree, on our own behalf and on behalf of any
accounts for which we are acting as hereinafter stated, that if we should
sell any Offered Notes we will do so only (A) pursuant to a registration
statement which has been declared effective under the 1933 Act, (B) for so
long as the Offered Notes are eligible for resale pursuant to Rule 144A
under the 1933 Act, to a Person we reasonably believe is a "qualified
institutional buyer" as defined in Rule 144A that purchases for its own
account or for the account of a qualified institutional buyer to whom
notice is given that the transfer is being made in reliance on Rule 144A or
(C) to an institutional "accredited investor" within the meaning of
subparagraph (a)(1), (2), (3) or (7) of Rule 501 under the 1933 Act (an
"INSTITUTIONAL ACCREDITED INVESTOR") that is acquiring the Offered Notes
for its own account, or for the account of such an Institutional Accredited
Investor, for investment purposes and not with a view to, or for offer or
sale in connection with, any distribution in violation of the 1933 Act, in
each case in compliance with the requirements of the Indenture dated as of
October 1, 2005 between Option One Owner Trust 2005-8 and Wells Fargo Bank,
N.A., as Indenture Trustee, and applicable state securities laws; and we
further agree, in the capacities stated above, to provide to any person
purchasing any of the Offered Notes from us a notice advising such
purchaser that resales of the Offered Notes are restricted as stated
herein.
(2) We understand that, in connection with any proposed resale of any Offered
Notes to an Institutional Accredited Investor, we will be required to
furnish to the Indenture Trustee and the Depositor a certification from
such transferee as provided in Section 2.12 of the Indenture to confirm
that the proposed sale is being made pursuant to an exemption from, or in a
transaction not subject to, the registration requirements of the 1933 Act
and applicable state securities laws. We further understand that the
Offered Notes purchased by us will bear a legend to the foregoing effect.
B-2-1
(3) We are acquiring the Offered Notes for investment purposes and not with a
view to, or for offer or sale in connection with, any distribution in
violation of the 1933 Act. We have such knowledge and experience in
financial and business matters as to be capable of evaluating the merits
and risks of our investment in the Offered Notes, and we and any account
for which we are acting are each able to bear the economic risk of such
investment.
(4) We are an Institutional Accredited Investor and we are acquiring the
Offered Notes purchased by us for our own account or for one or more
accounts (each of which is an Institutional Accredited Investor) as to each
of which we exercise sole investment discretion.
(5) We have received such information as we deem necessary in order to make our
investment decision.
(6) We either (i) are not, and are not acquiring the Offered Notes on behalf of
or with the assets of, an employee benefit plan or other retirement plan or
arrangement subject to Title I of ERISA or Section 4975 of the Code, or
(ii) are, or are acquiring the Offered Notes on behalf of or with the
assets of, an employee benefit plan or other retirement plan or arrangement
subject to Title I of ERISA of Section 4975 of the Code and either no
prohibited transaction within the meaning of Section 406(a) of ERISA or
Section 4975 of the Code will occur upon the transfer of the Note or the
conditions for exemptive relief under a prohibited transaction exemption
has been satisfied, including but not limited to, Prohibited Transaction
Class Exemption ("PTCE") 96-23 (relating to transactions effected by an
"in-house asset manager"), PTCE 95-60 (relating to transactions involving
insurance company general accounts), PTCE 91-38 (relating to transactions
involving bank collective investment funds), PTCE 90-1 (relating to
transactions involving insurance company pooled separate accounts), and
PTCE 84-14 (relating to transactions effected by a "qualified professional
asset manager").
Terms used in this letter which are not otherwise defined herein have the
respective meanings assigned thereto in the Indenture.
You and the Depositor are entitled to rely upon this letter and are
irrevocably authorized to produce this letter or a copy hereof to any interested
party in any administrative or legal proceeding or official inquiry with respect
to the matters covered hereby.
----------------------------------------
[Name of Transferor]
By:
------------------------------------
Name:
----------------------------------
Title:
---------------------------------
Dated:
________, ________
B-2-2
EXHIBIT B-3
FORM OF RULE 144A TRANSFEREE CERTIFICATE
Wells Fargo Bank, N.A.
Sixth Street and Marquette Avenue
Minneapolis, Minnesota 55479
Attention: Corporate Trust Services - Option One Owner Trust 2005-8
Re: Option One Owner Trust 2005-8
1. The undersigned is the ________ of __________________ (the "INVESTOR"),
a [corporation duly organized] and existing under the laws of ________________
on behalf of which he makes this affidavit.
2. The Investor either (i) is not, and is not acquiring the Option One
Owner Trust 2005-8 Notes (the "NOTES") on behalf of or with the assets of, an
employee benefit plan or other retirement plan or arrangement subject to Title I
of ERISA or Section 4975 of the Code, or (ii) is, or is acquiring the Notes on
behalf of or with the assets of, an employee benefit plan or other retirement
plan or arrangement subject to Title I of ERISA of Section 4975 of the Code and
either no prohibited transaction within the meaning of Section 406(a) of ERISA
or Section 4975 of the Code would occur upon the transfer of the Note or the
conditions for exemptive relief under a prohibited transaction exemption has
been satisfied, including but not limited to, Prohibited Transaction Class
Exemption ("PTCE") 96-23 (relating to transactions effected by an "in-house
asset manager"), PTCE 95-60 (relating to transactions involving insurance
company general accounts), PTCE 91-38 (relating to transactions involving bank
collective investment funds), PTCE 90-1 (relating to transactions involving
insurance company pooled separate accounts), and PTCE 84-14 (relating to
transactions effected by a "qualified professional asset manager").
3. The Investor understands that the Notes have not been, and will not be,
registered under the Securities Act of 1933, as amended (the "1933 ACT") or any
state securities laws, and may not be sold except as permitted in the following
sentence. The Investor agrees, on its own behalf and on behalf of any accounts
for which it is acting as hereinafter stated, that if it should sell any Notes
it will do so only (A) pursuant to a registration statement which has been
declared effective under the 1933 Act, (B) for so long as the Notes are eligible
for resale pursuant to Rule 144A under the 1933 Act, to a Person it reasonably
believes is a "qualified institutional buyer" as defined in Rule 144A that
purchases for its own account or for the account of a qualified institutional
buyer to whom notice is given that the transfer is being made in reliance on
Rule 144A or (C) to an institutional "accredited investor" within the meaning of
subparagraph (a) (1), (2), (3) or (7) of Rule 501 under the 1933 Act (an
"INSTITUTIONAL ACCREDITED INVESTOR") that is acquiring the Notes for its own
account, or for the account of such an Institutional Accredited Investor, for
investment purposes and not with a view to, or for offer or sale in connection
with, any distribution in violation of the 1933 Act, in each case in compliance
with the requirements of the Indenture dated as of October 1, 2005 between
Option One Owner Trust 2005-8 and Wells Fargo Bank, N.A., as Indenture Trustee,
and applicable state securities laws; and the Investor further agrees, in the
capacities stated above, to provide to any person purchasing any of the
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Notes from it a notice advising such purchaser that resales of the Notes are
restricted as stated herein.
[FOR TRANSFERS IN RELIANCE UPON RULE 144A]
4. The Investor is a "qualified institutional buyer" (as such term is
defined under Rule 144A under the Securities Act of 1933, as amended (the "1933
ACT"), and is acquiring the Notes for its own account or as a fiduciary or agent
for others (which others also are "qualified institutional buyers"). The
Investor is familiar with Rule 144A under the 1933 Act, and is aware that the
transferor of the Notes and other parties intend to rely on the statements made
herein and the exemption from the registration requirements of the 1933 Act
provided by Rule 144A.
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[Name of Transferor]
By:
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Name:
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Title:
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Dated:
________, ________
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EXHIBIT C
THIS NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED
(THE "1933 ACT"), OR ANY STATE SECURITIES LAWS. NEITHER THIS NOTE NOR ANY
INTEREST OR PARTICIPATION HEREIN MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED,
PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH
REGISTRATION, UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO,
REGISTRATION.
THE HOLDER OF THIS NOTE BY ITS ACCEPTANCE HEREOF AGREES TO OFFER, SELL OR
OTHERWISE TRANSFER SUCH NOTE ONLY (A) PURSUANT TO A REGISTRATION STATEMENT WHICH
HAS BEEN DECLARED EFFECTIVE UNDER THE 1933 ACT, (B) FOR SO LONG AS THIS NOTE IS
ELIGIBLE FOR RESALE PURSUANT TO RULE 144A UNDER THE 1933 ACT, TO A PERSON IT
REASONABLY BELIEVES IS A "QUALIFIED INSTITUTIONAL BUYER" AS DEFINED IN RULE 144A
UNDER THE 1933 ACT THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A
QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE TRANSFER IS BEING
MADE IN RELIANCE ON RULE 144A OR (C) TO AN INSTITUTIONAL "ACCREDITED INVESTOR"
WITHIN THE MEANING OF SUBPARAGRAPH (A) (1), (2), (3) OR (7) OF RULE 501 UNDER
THE 1933 ACT THAT IS ACQUIRING THE NOTE FOR ITS OWN ACCOUNT, OR FOR THE ACCOUNT
OF SUCH AN INSTITUTIONAL "ACCREDITED INVESTOR," FOR INVESTMENT PURPOSES AND NOT
WITH A VIEW TO, OR FOR OFFER OR SALE IN CONNECTION WITH, ANY DISTRIBUTION IN
VIOLATION OF THE 1933 ACT, IN EACH CASE IN COMPLIANCE WITH THE REQUIREMENTS OF
THE INDENTURE AND APPLICABLE STATE SECURITIES LAWS.
THIS NOTE MAY NOT BE TRANSFERRED UNLESS THE INDENTURE TRUSTEE HAS RECEIVED A
CERTIFICATE FROM THE TRANSFEREE TO THE EFFECT THAT EITHER (I) THE TRANSFEREE IS
NOT AN EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT PLAN OR ARRANGEMENT SUBJECT TO
TITLE I OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED, OR
SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (EACH, A "PLAN"),
AND IS NOT ACTING ON BEHALF OF OR INVESTING THE ASSETS OF A PLAN OR (II) IF THE
TRANSFEREE IS A PLAN, OR IS ACTING ON BEHALF OF OR INVESTING THE ASSETS OF A
PLAN, EITHER THAT NO PROHIBITED TRANSACTION WITHIN THE MEANING OF SECTION 406(a)
OF ERISA OR SECTION 4975 OF THE CODE WOULD OCCUR UPON THE TRANSFER OF THE NOTE
OR THAT THE CONDITIONS FOR EXEMPTIVE RELIEF UNDER A PROHIBITED TRANSACTION
EXEMPTION HAS BEEN SATISFIED INCLUDING BUT NOT LIMITED TO PROHIBITED TRANSACTION
CLASS EXEMPTION ("PTCE") 96-23 (RELATING TO TRANSACTIONS EFFECTED BY AN "IN
HOUSE ASSET MANAGER"), PTCE 95-60 (RELATING TO TRANSACTIONS INVOLVING INSURANCE
COMPANY GENERAL ACCOUNTS), PTCE 91-38 (RELATING TO TRANSACTIONS INVOLVING BANK
COLLECTIVE INVESTMENT FUNDS), PTCE 90-1 (RELATING TO TRANSACTIONS INVOLVING
INSURANCE COMPANY POOLED SEPARATE ACCOUNTS) AND PTCE 84-14 (RELATING TO
TRANSACTIONS EFFECTED BY A "QUALIFIED PROFESSIONAL ASSET MANAGER").
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