INDENTURE
between
EQUIVANTAGE MORTGAGE LOAN OWNER TRUST 199_-_,
as Issuer
and
_________________________,
as Indenture Trustee
Dated as of _____________, 199_
EQUIVANTAGE MORTGAGE LOAN OWNER TRUST 199_-_
Asset Backed Securities, Series 199_-_
TABLE OF CONTENTS
Page
ARTICLE I DEFINITIONS AND INCORPORATION BY REFERENCE......................2
SECTION 1.1 Definitions.............................................2
SECTION 1.2 Incorporation by Reference of Trust Indenture Act......12
SECTION 1.3 Rules of Construction..................................12
ARTICLE II THE NOTES.........................................................13
SECTION 2.1 Form...................................................13
SECTION 2.2 Execution, Authentication, Delivery and Dating.........13
SECTION 2.3 Registration; Registration of Transfer and Exchange....14
SECTION 2.4 Mutilated, Destroyed, Lost or Stolen Notes.............15
SECTION 2.5 Persons Deemed Owner...................................16
SECTION 2.6 Payment of Principal and Interest; Defaulted Interest..16
SECTION 2.7 Cancellation...........................................17
SECTION 2.8 Authentication of Notes................................17
SECTION 2.9 Release of Collateral..................................20
SECTION 2.10 Book-Entry Notes.......................................21
SECTION 2.11 Notices to Clearing Agency.............................22
SECTION 2.12 Definitive Notes.......................................22
SECTION 2.13 Tax Treatment..........................................22
ARTICLE III COVENANTS........................................................22
SECTION 3.1 Payment of Principal and Interest......................22
SECTION 3.2 Maintenance of Office or Agency........................23
SECTION 3.3 Money for Payments To Be Held in Trust.................23
SECTION 3.4 Existence..............................................25
SECTION 3.5 Protection of Collateral...............................25
SECTION 3.6 Annual Opinions as to Collateral.......................26
SECTION 3.7 Performance of Obligations; Servicing of Mortgage
Loans..................................................26
SECTION 3.8 Negative Covenants.....................................28
SECTION 3.9 Annual Statement as to Compliance......................29
SECTION 3.10 Covenants of the Issuer................................30
SECTION 3.11 Servicer's Obligations.................................30
SECTION 3.12 Restricted Payments....................................30
SECTION 3.13 Treatment of Notes as Debt for Tax Purposes............30
SECTION 3.14 Notice of Events of Default............................30
SECTION 3.15 Further Instruments and Acts...........................31
ARTICLE IV SATISFACTION AND DISCHARGE........................................31
SECTION 4.1 Satisfaction and Discharge of Indenture................31
SECTION 4.2 Application of Trust Money.............................32
SECTION 4.3 Repayment of Moneys Held by Paying Agent...............32
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TABLE OF CONTENTS -- (Cont'd)
ARTICLE V REMEDIES.......................................................33
SECTION 5.1 Events of Default......................................33
SECTION 5.2 Acceleration of Maturity; Rescission and Annulment.....34
SECTION 5.3 Collection of Indebtedness and Suits for Enforcement
by Indenture Trustee...................................35
SECTION 5.4 Remedies; Priorities...................................37
SECTION 5.5 Optional Preservation of the Collateral................39
SECTION 5.6 Limitation of Suits....................................40
SECTION 5.7 Unconditional Rights of Noteholders To Receive
Principal and Interest.................................40
SECTION 5.8 Restoration of Rights and Remedies.....................41
SECTION 5.9 Rights and Remedies Cumulative.........................41
SECTION 5.10 Delay or Omission Not a Waiver.........................41
SECTION 5.11 Control by Noteholders.................................41
SECTION 5.12 Waiver of Past Defaults................................42
SECTION 5.13 Undertaking for Costs..................................42
SECTION 5.14 Waiver of Stay or Extension Laws.......................42
SECTION 5.15 Action on Notes........................................43
SECTION 5.16 Performance and Enforcement of Certain Obligations.....43
ARTICLE VI THE INDENTURE TRUSTEE.............................................44
SECTION 6.1 Duties of Indenture Trustee............................44
SECTION 6.2 Rights of Indenture Trustee............................45
SECTION 6.3 Individual Rights of Indenture Trustee.................46
SECTION 6.4 Indenture Trustee's Disclaimer.........................46
SECTION 6.5 Notice of Defaults.....................................46
SECTION 6.6 Reports by Indenture Trustee to Holders................46
SECTION 6.7 Compensation and Indemnity.............................46
SECTION 6.8 Replacement of Indenture Trustee.......................47
SECTION 6.9 Successor Indenture Trustee by Merger..................48
SECTION 6.10 Appointment of Co-Indenture Trustee or
Separate Indenture Trustee.............................48
SECTION 6.11 Eligibility; Disqualification..........................49
SECTION 6.12 Preferential Collection of Claims Against Issuer.......50
ARTICLE VII NOTEHOLDERS' LISTS AND REPORTS...................................50
SECTION 7.1 Issuer To Furnish Indenture Trustee Names and
Addresses of Noteholders...............................50
SECTION 7.2 Preservation of Information; Communications
to Noteholders.........................................50
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SECTION 7.3 Reports by Issuer......................................50
SECTION 7.4 Reports by Indenture Trustee...........................51
ARTICLE VIII ACCOUNTS, DISBURSEMENTS AND RELEASES............................51
SECTION 8.1 Collection of Money....................................51
SECTION 8.2 Trust Accounts; Distributions..........................52
SECTION 8.3 General Provisions Regarding Accounts..................54
SECTION 8.4 Servicer's Monthly Statements..........................55
SECTION 8.5 Release of Collateral..................................55
SECTION 8.6 Opinion of Counsel.....................................56
ARTICLE IX SUPPLEMENTAL INDENTURES...........................................56
SECTION 9.1 Supplemental Indentures Without Consent of
Noteholders............................................56
SECTION 9.2 Supplemental Indentures with Consent of Noteholders....57
SECTION 9.3 Execution of Supplemental Indentures...................59
SECTION 9.4 Effect of Supplemental Indenture......................59
SECTION 9.5 Conformity with Trust Indenture Act....................59
SECTION 9.6 Reference in Notes to Supplemental Indentures..........59
SECTION 9.7 Amendments to Trust Agreement..........................59
ARTICLE X REDEMPTION OF NOTES............................................60
SECTION 10.1 Redemption.............................................60
SECTION 10.2 Form of Redemption Notice..............................61
SECTION 10.3 Notes Payable on Redemption Date; Provision for
Payment of Indenture Trustee and Securities Insurer....61
ARTICLE XI MISCELLANEOUS..................................................62
SECTION 11.1 Compliance Certificates and Opinions, etc..............62
SECTION 11.2 Form of Documents Delivered to Indenture Trustee.......63
SECTION 11.3 Acts of Noteholders....................................64
SECTION 11.4 Notices, etc., to Indenture Trustee, Issuer, Rating
Agencies and SecuritiesInsurer.........................65
SECTION 11.5 Notices to Noteholders; Waiver.........................65
SECTION 11.6 [RESERVED].............................................66
SECTION 11.7 Conflict with Trust Indenture Act......................66
SECTION 11.8 Effect of Headings and Table of Contents...............66
SECTION 11.9 Successors and Assigns.................................66
SECTION 11.10 Separability...........................................66
SECTION 11.11 Benefits of Indenture..................................66
SECTION 11.12 Legal Holidays.........................................67
SECTION 11.13 Governing Law..........................................67
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SECTION 11.14 Counterparts...........................................67
SECTION 11.15 Recording of Indenture.................................67
SECTION 11.16 Trust Obligation.......................................67
SECTION 11.17 No Petition............................................68
SECTION 11.18 Inspection.............................................68
SECTION 11.19 Grant of Noteholder Rights to Securities Insurer.......68
SECTION 11.20 Third Party Beneficiary................................68
SECTION 11.21 Suspension and Termination of Securities
Insurer's Rights.......................................68
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EXHIBITS
SCHEDULE A - Schedule of Mortgage Loans
EXHIBIT A - Form of Notes
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INDENTURE dated as of _________, 199_, between EquiVantage Mortgage Loan
Owner Trust 199_-_, a [Delaware] business trust (the "Issuer"), and
________________, a banking corporation, as trustee and not in its individual
capacity (the "Indenture Trustee").
Each party agrees as follows for the benefit of the other party and for
the equal and ratable benefit of the holders of the Issuer's ____% Asset
Backed Notes (the "Notes"):
GRANTING CLAUSE
Subject to the terms of this Indenture, the Issuer hereby Grants to the
Indenture Trustee at the Closing Date, as Indenture Trustee for the benefit
of the holders of the Notes, all of the Issuer's right, title and interest in
and to: (i) the Trust Estate (as defined in the Sale and Servicing
Agreement); (ii) all right, title and interest of the Issuer in the Sale and
Servicing Agreement (including the Issuer's right to cause the Seller to
repurchase Mortgage Loans from the Issuer under certain circumstances
described therein); (iii) 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 proceeds, accounts, accounts receivable, notes, drafts,
acceptances, chattel paper, checks, deposit accounts, insurance proceeds,
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; (iv) all funds on deposit from time to time in the Trust Accounts
(including the Certificate Distribution Account); and (v) all other property
of the Trust from time to time (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,
equally and ratably without prejudice, priority or distinction, and to secure
compliance with the provisions of this Indenture, all as provided in this
Indenture.
The Indenture Trustee, as Indenture Trustee on behalf of the holders of
the Notes, 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 holders of the Notes may be adequately
and effectively protected. The Indenture Trustee agrees and acknowledges
that the Indenture Trustee's Mortgage Loan Files will be held by the
Custodian for the benefit of the Indenture Trustee in [CITY], [STATE]. The
Indenture Trustee further agrees and acknowledges that each other item of
Collateral that is physically delivered to the Indenture Trustee will be held
by the Indenture Trustee in [CITY], [STATE].
INDENTURE (Series 199_-_) -- Page 1
ARTICLE
DEFINITIONS AND INCORPORATION BY REFERENCE
1.1 (a) Definitions. Except as otherwise specified herein or
as the context may otherwise require, the following terms
have the respective meanings set forth below for all
purposes of this Indenture.
"Act" has the meaning specified in Section 11.3(a).
"Administration Agreement" means the Administration Agreement dated as of
___________, 199_, among the Administrator, the Issuer and the Indenture
Trustee.
"Administrator" means _____________, a national banking association, or
any successor Administrator under the Administration Agreement.
"Affiliate" means, with respect to any specified Person, any other Person
controlling or controlled by or under common control with such specified
Person. For the purposes of this definition, "control" when used with
respect to any Person means the power to direct the management and policies
of such Person, directly or indirectly, whether through the ownership of
voting securities, by contract or otherwise; and the terms "controlling" and
"controlled" have meanings correlative to the foregoing.
"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).
"Available Collection Amount" means, an amount equal to the sum of: (i)
all amounts received on the Mortgage Loans or required to be paid by the
Servicer or the Seller during the related Due Period (exclusive of amounts
not required to be deposited in the Collection Account and amounts permitted
to be withdrawn by the Indenture Trustee from the Collection Account pursuant
to Section 5.01(d) of the Sale and Servicing Agreement) as reduced by any
portion thereof that may not be withdrawn therefrom pursuant to an order of a
United States bankruptcy court of competent jurisdiction imposing a stay
pursuant to Xxxxxxx 000 xx xxx Xxxxxx Xxxxxx Bankruptcy Code; (ii) in the
case of a Distribution Date relating to a Due Period that occurs prior to the
end of the Funding Period, an amount from the Capitalized Interest Account
sufficient to fund any shortfall in the Interest Distribution Amount
attributable to the amounts in the Pre-Funding Account; (iii) in the case of
the Pre-Funding Termination Distribution Date, amounts, if any, remaining in
the Pre-Funding
INDENTURE (Series 199_-_) -- Page 2
Account at the end of the Funding Period (net of reinvestment income, which
shall be transferred to the Capitalized Interest Account); (iv) with respect
to the final Distribution Date or an early redemption or termination of the
Offered Securities pursuant to Section 11.02 of the Sale and Servicing
Agreement, the Termination Price, and (v) any and all income or gain from
investments in the Collection Account.
"Basic Documents" means the Certificate of Trust, the Trust Agreement,
this Indenture, the Sale and Servicing Agreement, the Administration
Agreement, the Insurance Agreement, the Custodial Agreement, the Note
Depository Agreement, the Certificate Depository Agreement and other
documents and certificates delivered in connection therewith.
"Book-Entry Notes" means a beneficial interest in the Notes, ownership
and transfers of which shall be made through book entries by a Clearing
Agency as described in Section 2.10.
"Business Day" means any day other than (i) a Saturday or a Sunday, or
(ii) a day on which banking institutions in [New York City] or the city in
which the Securities Insurer or the corporate trust office of the Indenture
Trustee is located are authorized or obligated by law or executive order to
be closed.
"Certificate Depository Agreement" has the meaning specified in Section
1.1 of the Trust Agreement.
"Certificate of Trust" means the certificate of trust of the Issuer
substantially in the form of Exhibit B to the Trust Agreement.
"Clearing Agency" means an organization registered as a "clearing agency"
pursuant to Section 17A of the Exchange Act.
"Clearing Agency Participant" means a broker, dealer, bank, other
financial institution or other Person for whom from time to time a Clearing
Agency effects book-entry transfers and pledges of securities deposited with
the Clearing Agency.
"Closing Date" means ___________, 199_.
"Code" means the Internal Revenue Code of 1986, as amended from time to
time, and Treasury Regulations promulgated thereunder.
"Collateral" has the meaning specified in the Granting Clause of this
Indenture.
"Company" means EquiVantage Inc., a Delaware corporation, or any
successor in interest thereto.
"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
INDENTURE (Series 199_-_) -- Page 3
of this Agreement is located at ______________, [CITY], [STATE]; Attention:
Corporate Trust Department, 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.
"Definitive Notes" has the meaning specified in Section 2.12.
"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 _____ by [S&P] and ____ by
[Moody's] (or comparable ratings if [S&P]and [Moody's] are not the Rating
Agencies).
"Distribution Date" means the __th day of any month or if such __th day
is not a Business Day, the first Business Day immediately following such day,
commencing in ___________ 199_.
"Due Period" means, with respect to any Distribution Date and the Notes,
the calendar month immediately preceding the month of such Distribution Date.
"Event of Default" has the meaning specified in Section 5.1.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Executive Officer" means, with respect to any 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 corporation; and with respect to any partnership, any
general partner thereof.
"Final Scheduled Distribution Date" means the Distribution Date occurring
in __________, 200_.
"Grant" means mortgage, pledge, bargain, sell, warrant, alienate, remise,
release, convey, assign, transfer, create, and xxxxx x xxxx 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
INDENTURE (Series 199_-_) -- Page 4
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" or "Noteholder" means the Person in whose name a Note is
registered on the Note Register; provided that the exercise of any rights of
such Holder or Noteholder under this Indenture shall at all times be subject
to Section 11.19 hereto.
"Indenture Trustee" means First Bank National Association, a national
banking corporation, as Indenture Trustee under this Indenture, or any
successor Indenture Trustee under this Indenture.
"Independent" means, when used with respect to any specified Person, that
the Person (a) is in fact independent of the Issuer, any other obligor on the
Notes, the Seller and any Affiliate of any of the foregoing Persons, (b) does
not have any direct financial interest or any material indirect financial
interest in the Issuer, any such other obligor, the Seller or any Affiliate
of any of the foregoing Persons and (c) is not connected with the Issuer, any
such other obligor, the Seller or any Affiliate of any of the foregoing
Persons as an officer, employee, promoter, underwriter, trustee, partner,
director or person performing similar functions.
"Independent Certificate" means a certificate or opinion to be delivered
to the Indenture Trustee under the circumstances described in, and otherwise
complying with, the applicable requirements of Section 11.1, made by an
Independent appraiser or other expert appointed by an Issuer Order and
approved by the Indenture Trustee in the exercise of reasonable care, and
such opinion or certificate shall state that the signer has read the
definition of "Independent" in this Indenture and that the signer is
Independent within the meaning thereof.
"Interest Distribution Amount" means, on any Distribution Date, the sum
of the Noteholders' Interest Distributable Amount for the Notes and the
Certificateholders' Interest Distributable Amount for such Distribution Date.
"Interest Rate" means ______% per annum (computed on the basis of a
360-day year consisting of twelve 30-day months).
"Issuer" means EquiVantage Mortgage Loan Owner Trust 199_-_, until a
successor replaces it and, thereafter, means the successor and, for purposes
of any provision contained herein and required by the TIA, each other obligor
on the Notes.
"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.
["Moody's" means Xxxxx'x Investor Service, Inc., or any successor thereto.]
"Notes" means the ____% Asset Backed Notes, substantially in the form of
Exhibit A.
INDENTURE (Series 199_-_) -- Page 5
"Note Depository Agreement" means the agreement dated _________, 199_,
among the Issuer, the Administrator, the Indenture Trustee and The Depository
Trust Company, as the initial Clearing Agency, relating to the Book Entry
Notes.
"Note Owner" means, with respect to a Book-Entry Note, the Person who is
the beneficial owner of such Book-Entry Note, as reflected on the books of
the Clearing Agency or on the books of a Person maintaining an account with
such Clearing Agency (directly as a Clearing Agency Participant or as an
indirect participant, in each case in accordance with the rules of such
Clearing Agency).
"Note Register" and "Note Registrar" have the respective meanings
specified in Section 2.3.
"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
11.1, 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 employees
of or counsel to the Issuer and who shall be satisfactory to the Indenture
Trustee and the Securities Insurer, and which opinion or opinions shall be
addressed to the Indenture Trustee, as Indenture Trustee, and the Securities
Insurer and shall comply with any applicable requirements of Section 11.1 and
shall be in form and substance satisfactory to the Indenture Trustee and the
Securities Insurer.
"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 been theretofore deposited with the
Indenture Trustee or any Paying Agent in trust for the Holders of
such Notes (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 has been
made, satisfactory to the Indenture Trustee); and
(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, that in
determining whether the Holders of the requisite Outstanding
Amount of the Notes have given any request, demand,
authorization, direction, notice, consent, or waiver hereunder or
under any
INDENTURE (Series 199_-_) -- Page 6
Basic Document, Notes owned by the Issuer, any other obligor upon
the Notes, the Seller 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 knows to be so owned shall be so
disregarded. Notes so owned that have been pledged in good faith
may be regarded as Outstanding if the pledgee establishes to the
satisfaction of the Indenture Trustee the pledgee's right so to
act with respect to such Notes and that the pledgee is not the
Issuer, any other obligor upon the Notes, the Seller or any
Affiliate of any of the foregoing Persons.
"Outstanding Amount" means the aggregate principal amount of all Notes
Outstanding at the date of determination.
"Owner Trustee" means ________________, 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 the Indenture Trustee or any other Person that meets
the eligibility standards for the Indenture Trustee specified in Section 6.11
and is authorized by the Issuer to make payments to and distributions from
the Note Distribution Account, including payment of principal of or interest
on the Notes on behalf of the Issuer.
"Payment Date" means a Distribution Date.
"Person" means any individual, corporation, estate, partnership, joint
venture, association, joint stock company, trust (including any beneficiary
thereof), unincorporated organization, or government or any agency or
political subdivision thereof.
"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 2.4 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.
"Proceeding" means any suit in equity, action at law or other judicial or
administrative proceeding.
"Rating Agency Condition" means, with respect to any action to which a
Rating Agency Condition applies, that each Rating Agency shall have been
given 10 days (or such shorter period as is acceptable to each Rating Agency)
prior notice thereof and that each of the Rating Agencies shall have notified
the Seller, the Servicer and the Issuer in writing that such action will not
result in a reduction or withdrawal of the then current rating of the Notes.
INDENTURE (Series 199_-_) -- Page 7
"Rating Agency" means either or both of (i)
[Standard & Poor's] or (ii) [Xxxxx'x]. If no such organization or successor
is any longer in existence, "Rating Agency" shall be a nationally recognized
statistical rating organization or other comparable Person designated by the
Securities Insurer, notice of which designation shall be given to the Issuer,
the Indenture Trustee, the Owner Trustee and the Servicer.
"Record Date" means, as to each Distribution Date, the last Business Day
of the month immediately preceding the month in which such Distribution Date
occurs.
"Redemption Date" means in the case of a redemption of the Notes pursuant
to Section 10.1 or a payment to Noteholders pursuant to Section 10.3, the
Distribution Date specified by the Affiliated Holder pursuant to Section
10.1.
"Redemption Price" means in the case of a redemption of the Notes
pursuant to Section 10.1, an amount equal to the unpaid principal amount of
the Notes redeemed plus accrued and unpaid interest thereon at the Interest
Rate for the Notes being so redeemed to but excluding the Redemption Date,
plus any unpaid Trust Fees and Expenses and all other amounts owed to the
Securities Insurer pursuant to the Insurance Agreement.
"Registered Holder" means the Person in whose name a Note is registered
on the Note Register on the applicable Record Date.
"Regular Principal Distribution Amount" means, on each Distribution Date,
an amount equal to the lesser of:
(A) the sum of the Principal Balance of the Notes and the Certificate
Principal Balance of the Certificates immediately prior to such
Distribution Date; and
(B) the greater of (1) the sum of (i) each scheduled payment of
principal collected by the Servicer in the related Due Period, (ii) all
partial and full principal prepayments applied by the Servicer during such
related Due Period, (iii) the principal portion of all Net Liquidation
Proceeds, Insurance Proceeds and Released Mortgaged Property Proceeds
received during the related Due Period, (iv) (a) that portion of the
purchase price of any repurchased Mortgage Loan which represents principal
and (b) the principal portion of any Substitution Adjustments required to
be deposited in the Collection Account as of the related Determination Date,
(v) the amount of any Net Loan Losses for the preceding Due Period equal
to the amount on deposit in the Reserve Account until such amount is
reduced to zero, and (vi) if the Overcollateralization Amount is zero, the
amount of any Net Loan Losses for the preceding Due Period minus the sum of
(a) the amount included in clause (v) above for such Distribution Date and
(b) the amount of Net Loan Losses for the preceding Due Period allocated to
reduce the Overcollateralization Amount to zero on such Distribution Date
pursuant to Section 5.09 of the Sale & Servicing Agreement; and (2) the
amount by which (i) the aggregate principal balance of the Securities as of
the preceding Distribution Date (after giving effect to all payments of
principal on such preceding Distribution Date) exceeds
INDENTURE (Series 199_-_) -- Page 8
(ii) the Pool Principal Balance plus funds on deposit in the Pre-Funding
Account, each as of the immediately preceding Determination Date; provided,
however, that if such Distribution Date is an Overcollateralization
Stepdown Date, then with respect to the distribution of principal to the
Noteholders and Certificateholders the foregoing amount in each case, will
be reduced (but not less than zero) by the Overcollateralization Reduction
Amount, if any, for such Distribution Date.
"Reserve Account" means, the account established and maintained pursuant
to Section 5.07 of the Sale and Servicing Agreement.
"Responsible Officer" means, with respect to the Indenture Trustee, any
officer within the Corporate Trust Office of the Indenture Trustee, including
any Vice President, Assistant Vice President, Assistant Treasurer, Assistant
Secretary or any other officer of the Indenture Trustee customarily
performing functions similar to those performed by any of the above
designated officers and also, with respect to a particular matter, any other
officer to whom such matter is referred because of such officer's knowledge
of and familiarity with the particular subject.
"Sale and Servicing Agreement" means the Sale and Servicing Agreement
dated as of __________, 199_, among the Issuer, EquiVantage Inc., as Seller
and Servicer, and the Indenture Trustee, as Indenture Trustee and Co-Owner
Trustee.
"Schedule of Mortgage Loans" means the listing of the Mortgage Loans set
forth in Schedule A, as supplemented as of each Subsequent Transfer Date and
as of any date on which a Deleted Mortgage Loan has been repurchased from the
Trust or substituted with a Qualified Mortgage Loan pursuant to Section 3.05
of the Sale and Servicing Agreement.
"Securities Act" means the Securities Act of 1933, as amended.
"Seller" shall mean EquiVantage Inc., in its capacity as seller under the
Sale and Servicing Agreement, and its successor in interest.
"Servicer" shall mean EquiVantage Inc., in its capacity as servicer under
the Sale and Servicing Agreement, and any Successor Servicer thereunder.
["Standard & Poor's" or "S&P" means Standard & Poor's Ratings Group, a
division of The XxXxxx-Xxxx Companies, Inc.]
"State" means any one of the 50 states of the United States of America or
the District of Columbia.
"Successor Servicer" has the meaning specified in Section 3.7(e).
"Trust Indenture Act" or "TIA" means the Trust Indenture Act of 1939 as
in force on the date hereof, unless otherwise specifically provided.
INDENTURE (Series 199_-_) -- Page 9
"UCC" means, unless the context otherwise requires, the Uniform
Commercial Code, as in effect in the relevant jurisdiction, as amended from
time to time.
(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.
1.2 Incorporation by Reference of Trust Indenture Act. Whenever this
Indenture refers to a provision of the TIA, the provision is
incorporated by reference in and made a part of this Indenture. The
following TIA terms used in this Indenture have the following meanings:
"Commission" means the Securities and Exchange Commission.
"indenture securities" means the Notes.
"indenture security holder" means a Noteholder.
"indenture to be qualified" means this Indenture.
"indenture trustee" or "institutional trustee" means the Indenture Trustee.
"obligor" on the indenture securities means the Issuer and any other obligor
on the indenture securities.
All other TIA terms used in this Indenture that are defined in the TIA,
defined by TIA reference to another statute or defined by Commission rule
have the meaning assigned to them by such definitions.
1.3 Rules of Construction. Unless the context otherwise requires:
(i) a term has the meaning assigned to it;
(ii) an accounting term not otherwise defined has the meaning
assigned to it in accordance with generally accepted accounting
principles as in effect from time to time;
(iii) "or" is not exclusive;
(iv) "including" means including without limitation;
(v) words in the singular include the plural and words in the plural
include the singular; and
INDENTURE (Series 199_-_) -- Page 10
(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
THE NOTES
2.1 Form. The Notes shall be designated as the "EquiVantage Mortgage Loan
Owner Trust 199_-_ Asset Backed Notes, Series 199_-_". The Notes,
together with the Indenture Trustee's certificate of authentication,
shall be in substantially the form set forth in Exhibit A, with such
appropriate insertions, omissions, substitutions and other variations
as are required or permitted by this Indenture, and may have such
letters, numbers or other marks of identification and such legends or
endorsements placed thereon as may, consistently herewith, be
determined by the officers executing such Notes, as evidenced by their
execution thereof. Any portion of the text of any Note may be set
forth on the reverse thereof, with an appropriate reference thereto on
the face of the Note.
The Definitive Notes shall 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 set forth in Exhibit A are part of the terms of this Indenture.
2.2 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.
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 2.8,
the Indenture Trustee shall authenticate and deliver Notes for original issue
in an aggregate principal amount of
INDENTURE (Series 199_-_) -- Page 11
$___________. The aggregate principal amount of the Notes outstanding at
any time may not exceed such amount.
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
____________, 199_. 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 issuable as registered Notes in the
minimum denomination [$100,000] and integral multiples of [$1,000] in excess
thereof.
No Note shall be entitled to any benefit under this Indenture or be valid
or obligatory for any purpose, unless there appears on such Note a
certificate of authentication substantially in the form provided for herein
executed by the Indenture Trustee by the manual signature of one of its
authorized signatories, and such certificate upon any Note shall be
conclusive evidence, and the only evidence, that such Note has been duly
authenticated and delivered hereunder.
2.3 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 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 Holders of the Notes and
the principal amounts and number of such 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 3.2, 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 principal amount.
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 from the
Indenture Trustee, the Notes which the Noteholder making the exchange is
entitled to receive.
INDENTURE (Series 199_-_) -- Page 12
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 form satisfactory to the Indenture Trustee 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 Note Registrar, which requirements include membership or
participation in the Securities Transfer Agent's Medallion Program ("STAMP")
or such other "signature guarantee program" as may be determined by the Note
Registrar in addition to, or in substitution for, STAMP, all in accordance
with the Exchange Act.
No service charge shall be made to a Holder 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 2.4 or Section 9.6 not involving any
transfer.
The preceding provisions of this Section 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.
2.4 Mutilated, Destroyed, Lost or Stolen Notes. If (i) any mutilated Note
is surrendered to the Indenture Trustee, or the Indenture Trustee
receives evidence to its satisfaction of the destruction, loss or
theft of any Note, and (ii) there is delivered to the Indenture
Trustee such security or indemnity as may be required by it to hold
the Issuer and the Indenture Trustee harmless, then, in the absence of
notice to the Issuer, the Note Registrar or the Indenture Trustee that
such Note has been acquired by a bona fide purchaser, and the Issuer
shall execute, and upon its request the Indenture Trustee shall
authenticate and deliver, in exchange for or in lieu of any such
mutilated, destroyed, lost or stolen Note, a replacement Note;
provided, 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 and the Indenture Trustee shall be
entitled to recover such replacement Note (or such payment) from the
Person to whom it was delivered or any Person taking such replacement
Note from such Person to whom such replacement Note was delivered or
any assignee of such Person, except a bona fide purchaser, and shall be
entitled to recover upon the security or
INDENTURE (Series 199_-_) -- Page 13
indemnity provided therefor to the extent of any loss, damage, cost or
expense incurred by the Issuer or the Indenture Trustee in connection
therewith.
Upon the issuance of any replacement Note under this Section, the Issuer
may require the payment by the Holder of such Note, other than the Securities
Insurer, 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 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 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.
2.5 Persons Deemed Owner. Prior to due presentment for registration of
transfer of any Note, the Issuer, the Securities Insurer, the Indenture
Trustee and any agent of the Issuer, the Securities Insurer or the
Indenture Trustee may treat the Person in whose name any Note is
registered (as of the day of determination) as the owner of such Note
for the purpose of receiving payments of principal of and interest, if
any, on such Note and for all other purposes whatsoever, whether or
not such Note be overdue, and none of the Issuer, the Securities
Insurer, the Indenture Trustee or any agent of the Issuer or the
Indenture Trustee shall be affected by notice to the contrary.
2.6 Payment of Principal and Interest; Defaulted Interest.
(a) The Notes shall accrue interest at the Interest Rate as set
forth in Exhibit A, and such interest shall be payable on each
Distribution Date as specified therein, subject to Section 3.1.
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 Distribution Date shall be paid to the Person
in whose name such Note (or one or more Predecessor Notes) is
registered on the Record Date by check mailed first-class
postage prepaid to such Person's address as it appears on the
Note Register on such Record Date, except that, unless Definitive
Notes have been issued pursuant to Section 2.12, with respect
to Notes registered on the Record Date in the name of the
nominee of the Clearing Agency (initially, such nominee to be
Cede & Co.), payment will be made by wire transfer in immediately
available funds to the account designated by such nominee and
except
INDENTURE (Series 199_-_) -- Page 14
for the final installment of principal payable with respect to
such Note on a Distribution Date or on the Final Scheduled
Distribution Date for the Notes (and except for the Redemption
Price for any Note called for redemption pursuant to Section
10.1), which shall be payable as provided below. The funds
represented by any such checks returned undelivered shall be
held in accordance with Section 3.3.
(b) The principal of each Note shall be payable in installments on
each Distribution Date as provided in the forms of the Notes
set forth in Exhibit A. 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 Final
Scheduled Distribution Date, (ii) the Redemption Date or (iii) the
date on which an Event of Default shall have occurred and be
continuing, if the Indenture Trustee or the Holders of Notes
representing not less than a majority of the Outstanding Amount
of the Notes have declared the Notes to be immediately due and
payable in the manner provided in Section 5.2. All principal
payments on the Notes shall be made pro rata to the Noteholders
entitled thereto. The Indenture Trustee shall notify the
Person in whose name a Note is registered at the close of
business on the Record Date preceding the Distribution 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 Distribution 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. A copy of such form of notice shall be sent to the
Securities Insurer by the Indenture Trustee. Notices in
connection with redemptions of Notes shall be mailed to
Noteholders as provided in Section 10.2.
2.7 Cancellation. All Notes surrendered for payment, registration
of transfer, exchange or redemption shall, if surrendered to any
Person other than the Indenture Trustee, be delivered to the
Indenture Trustee and shall be promptly 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 be promptly
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, 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
INDENTURE (Series 199_-_) -- Page 15
they be destroyed or returned to it; provided, that such Issuer Order
is timely and the Notes have not been previously disposed of by the
Indenture Trustee.
2.8 Authentication of Notes. The Notes may be authenticated by the
Indenture Trustee, upon Issuer Request and upon receipt by the
Indenture Trustee of the following:
(a) An Issuer Order authorizing the execution and
authentication of such Notes by the Issuer.
(b) All of the items of Collateral which shall be delivered to
the Indenture Trustee or its designee.
(c) An executed counterpart of the Trust Agreement.
(d) Opinions of Counsel addressed to the Indenture Trustee and
the Securities Insurer to the effect that:
(i) all instruments furnished to the Indenture
Trustee as conditions precedent to the
authentication of the Notes by the Indenture
Trustee pursuant to the Indenture conform to the
requirements of this Indenture and constitute all
the documents required to be delivered hereunder
for the Indenture Trustee to authenticate the Notes;
(ii) all conditions precedent provided for in this
Indenture relating to the authentication of the
Notes have been complied with;
(iii) the Owner Trustee has power and authority to
execute, deliver and perform its obligations under
the Trust Agreement;
(iv) the Issuer has been duly formed is validly
existing as a business 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
Administration Agreement, the Insurance Agreement
and the Sale and Servicing Agreement;
(v) assuming due authorization, execution and delivery
thereof by the Indenture Trustee, the Indenture is
the 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
INDENTURE (Series 199_-_) -- Page 16
enforcement is considered in a proceeding in equity
or at law);
(vi) 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);
(vii) the Trust Agreement authorizes the Issuer to
Grant the Collateral to the Indenture Trustee as
security for the Notes and the Owner Trustee has
taken all necessary action under the Trust Agreement
to Grant the Collateral to the Indenture Trustee;
(viii) this Indenture has been duly qualified under
the Trust Indenture Act of 1939;
(ix) this Indenture, together with the Grant of the
Collateral to the Indenture Trustee, creates a
valid security interest in the Collateral in favor
of the Indenture Trustee for the benefit of the
Noteholders;
(x) such action has been taken with respect to
delivery of possession of the Collateral, and with
respect to the execution and filing of this
Indenture and any financing statements as are
necessary to make effective and to perfect a first
priority security interest created by this
Indenture in the Collateral in favor of the
Indenture Trustee, except that with respect to the
Debt Instruments, possession of such Debt
Instruments must be maintained by the Indenture
Trustee or an agent of the Indenture Trustee (other
than the Issuer, an Affiliate of the Issuer, or a
"securities intermediary," as defined in Section
8.102 of the UCC, an agent of the Indenture
Trustee; and
(xi) 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
INDENTURE (Series 199_-_) -- Page 17
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 "blue sky"
laws.
(e) An Officer's Certificate complying with the requirements of
Section 11.1 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;
(ii) the Issuer is the owner of all of the Mortgage Loans,
has not assigned any interest or participation in the
Mortgage Loans (or, if any such interest or
participation has been assigned, it has been released)
and has the right to Grant all of the Mortgage Loans
to the Indenture Trustee;
(iii) the Issuer has Granted to the Indenture Trustee all of
its right, title, and interest in the Collateral, and
has delivered or caused the same to be delivered to
the Indenture Trustee;
(iv) attached thereto are true and correct copies of
letters signed by [Xxxxx'x] and [S&P] confirming that
the Notes and the Certificates have been rated ["Aaa"]
and ["AAA"] by [Xxxxx'x] and [S&P], respectively; and
(v) all conditions precedent provided for in this
Indenture relating to the authentication of the Notes
have been complied with.
(f) A fair value certificate from the Servicer, as agent of the
Trust, pursuant to Section 2(a)M of the Administration
Agreement.
2.9 Release of Collateral.
INDENTURE (Series 199_-_) -- Page 18
(a) Subject to subsections (b) and (c) hereof and Section
11.1 and the terms of the Basic Documents, the Indenture
Trustee shall release property from the lien of this
Indenture only upon receipt of an Issuer Request
accompanied by an Officer's Certificate, an Opinion of
Counsel and Independent Certificates in accordance with
TIA Sections 314(c) and 314(d)(l) or an Opinion of Counsel
in lieu of such Independent Certificates to the effect
that the TIA does not require any such Independent
Certificates.
(b) The Servicer, on behalf of the Issuer, shall be entitled
to obtain a release from the lien of this Indenture for
any Mortgage Loan and the related Mortgaged Property at
any time (i) after a payment by the Issuer of the
Purchase Price of the Mortgage Loan, (ii) after a
Qualified Substitute Mortgage Loan is substituted for such
Mortgage Loan and payment of the Substitution Adjustment,
if any, (iii) after liquidation of the Mortgage Loan in
accordance with Section 4.02 of the Sale and Servicing
Agreement and the deposit of all Recoveries thereon in the
Collection Account, or (iv) upon the termination of a
Mortgage Loan (due to, among other causes, a prepayment in
full of the Mortgage Loan and sale or other disposition of
the related Mortgaged Property), if the Issuer delivers to
the Indenture Trustee and the Securities Insurer an Issuer
Request (A) identifying the Mortgage Loan and the related
Mortgaged Property to be released, (B) requesting the
release thereof, (C) setting forth the amount deposited in
the Collection Account with respect thereto, and (D)
certifying that the amount deposited in the Collection
Account (x) equals the Purchase Price of the Mortgage
Loan, in the event a Mortgage Loan and the related
Mortgaged Property are being released from the lien of
this Indenture pursuant to item (i) above, (y) equals the
Substitution Adjustment related to the Qualified
Substitute Mortgage Loan and the Deleted Mortgage Loan
released from the lien of the Indenture pursuant to item
(ii) above, or (z) equals the entire amount of Recoveries
received with respect to such Mortgage Loan and the
related Mortgaged Property in the event of a release from
the lien of this Indenture pursuant to items (iii) or (iv)
above.
(c) The Indenture Trustee shall, if requested by the
Servicer, temporarily release or cause the Custodian to
temporarily release to the Servicer the Indenture
Trustee's Mortgage Loan File pursuant to the provisions of
Section 7.02 of the Sale and Servicing Agreement upon
compliance by the Servicer of the provisions thereof
provided that the Indenture Trustee's Mortgage Loan File
shall have been stamped to signify the Issuer's pledge to
the Indenture Trustee under the Indenture.
INDENTURE (Series 199_-_) -- Page 19
2.10 Book-Entry Notes. The Notes, upon original issuance, will be
issued in the form of typewritten Notes representing the Book-Entry
Notes, to be delivered to The Depository Trust Company, the initial
Clearing Agency, by, or on behalf of, the Issuer. The Book-Entry
Notes shall be registered initially on the Note Register in the name
of Cede & Co., the nominee of the initial Clearing Agency, and no
Owner thereof will receive a definitive Note representing such Note
Owner's interest in such Note, except as provided in Section 2.12.
Unless and until definitive, fully registered Notes (the "Definitive
Notes") have been issued to such Note Owners pursuant to Section
2.12:
(i) the provisions of this Section shall be in full force and effect;
(ii) the Note Registrar and the Indenture Trustee shall be entitled
to deal with the Clearing Agency for all purposes of this
Indenture (including the payment of principal of and interest on
the Notes and the giving of instructions or directions hereunder)
as the sole holder of the Notes, and shall have no obligation to
the Note Owners;
(iii) to the extent that the provisions of this Section conflict
with any other provisions of this Indenture, the provisions of
this Section shall control;
(iv) the rights of Note Owners shall be exercised only through the
Clearing Agency and shall be limited to those established by law
and agreements between such Note Owners and the Clearing Agency
and/or the Clearing Agency Participants pursuant to the Note
Depository Agreement. Unless and until Definitive Notes are
issued pursuant to Section 2.12, the initial Clearing Agency will
make book-entry transfers among the Clearing Agency Participants
and receive and transmit payments of principal of and interest on
the Notes to such Clearing Agency Participants; and
(v) whenever this Indenture requires or permits actions to be taken
based upon instructions or directions of Holders of Notes
evidencing a specified percentage of the Outstanding Amount of
the Notes, the Clearing Agency shall be deemed to represent such
percentage only to the extent that it has received instructions
to such effect from Note Owners and/or Clearing Agency
Participants owning or representing, respectively, such required
percentage of the beneficial interest in the Notes and has
delivered such instructions to the Indenture Trustee.
2.11 Notices to Clearing Agency. Whenever a notice or other
communication to the Noteholders is required under this Indenture,
unless and until Definitive Notes shall have been issued to such
Note Owners pursuant to Section 2.12, the Indenture Trustee shall
give all such notices and communications specified herein to be given
INDENTURE (Series 199_-_) -- Page 20
to Holders of the Notes to the Clearing Agency, and shall have no
obligation to such Note Owners.
2.12 Definitive Notes. If (i) the Administrator advises the
Indenture Trustee in writing that the Clearing Agency is no longer
willing or able to properly discharge its responsibilities with
respect to the Book-Entry Notes and the Administrator is unable to
locate a qualified successor, (ii) the Administrator at its option
advises the Indenture Trustee in writing that it elects to terminate
the book-entry system through the Clearing Agency or (iii) after the
occurrence of an Event of Default, Owners of the Book-Entry Notes
representing beneficial interests aggregating at least a majority of
the Outstanding Amount of such Notes advise the Clearing Agency in
writing that the continuation of a book-entry system through the
Clearing Agency is no longer in the best interests of such Note
Owners, then the Clearing Agency shall notify all Note Owners and
the Indenture Trustee of the occurrence of such event and of the
availability of Definitive Notes to Note Owners requesting the same.
Upon surrender to the Indenture Trustee of the typewritten Notes
representing the Book-Entry Notes by the Clearing Agency,
accompanied by registration instructions, the Issuer shall execute
and the Indenture Trustee shall authenticate the Definitive Notes in
accordance with the instructions of the Clearing Agency. None of
the Issuer, the Note Registrar or the Indenture Trustee shall be
liable for any delay in delivery of such instructions and may
conclusively rely on, and shall be protected in relying on, such
instructions. Upon the issuance of Definitive Notes, the Indenture
Trustee shall recognize the Holders of the Definitive Notes as
Noteholders.
2.13 Tax Treatment. The Issuer has entered into this Indenture, and
the Notes will be issued, with the intention that, for federal,
state and local income, single business and franchise tax purposes,
the Notes will qualify as indebtedness of the Issuer secured by the
Collateral. The Issuer, by entering into this Indenture, and each
Noteholder, by its acceptance of a Note (and each Note Owner by its
acceptance of an interest in the applicable Book-Entry Note), agree
to treat the Notes for federal, state and local income, single
business and franchise tax purposes as indebtedness of the Issuer.
ARTICLE
COVENANTS
3.1 Payment of Principal and Interest. The Issuer will duly and
punctually pay (or will cause to be duly and punctually paid) the
principal of and interest, if any, on the Notes in accordance with
the terms of the Notes and this Indenture. Without limiting the
foregoing, subject to and in accordance with Section 8.2(c), the
Issuer will cause to be distributed all amounts on deposit in the
Note Distribution Account on a Distribution Date deposited therein
pursuant to the Sale and Servicing Agreement for the benefit of the
Notes, to the Noteholders. Amounts properly withheld under the
INDENTURE (Series 199_-_) -- Page 21
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 and any
amounts received by the Indenture Trustee under the Guaranty Policy in
respect of the Notes, as provided in this Indenture. The Issuer shall not
otherwise be liable for payments on the Notes. If any other provision of
this Indenture shall be deemed to conflict with the provisions of this
Section 3.1, the provisions of this Section 3.1 shall control.
3.2 Maintenance of Office or Agency. The Issuer will or will cause
the Administrator to maintain in [CITY], [STATE] 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 Issuer
hereby initially appoints the Administrator to serve as its agent
for the foregoing purposes and to serve as Paying Agent with respect
to the Certificates. The Issuer will give prompt written notice to
the Indenture Trustee of the location, and of any change in the
location, of any such office or agency. If at any time the Issuer
shall fail to maintain any such office or agency or shall fail to
furnish the Indenture Trustee with the address thereof, such
surrenders, notices and demands may be made or served at the
Corporate Trust Office, and the Issuer hereby appoints the Indenture
Trustee as its agent to receive all such surrenders, notices and
demands.
3.3 Money for Payments To Be Held in Trust. As provided in Section
8.2(a ) and (b), all payments of amounts due and payable with
respect to any Notes that are to be made from amounts withdrawn from
the Collection Account and the Note Distribution Account pursuant to
Section 8.2(c) shall be made on behalf of the Issuer by the
Indenture Trustee or by the Paying Agent, and no amounts so
withdrawn from the Collection Account and the Note Distribution
Account for payments of Notes shall be paid over to the Issuer
except as provided in this Section.
On or before the third Business Day preceding each Distribution Date and
Redemption Date, the Indenture Trustee shall deposit or cause to be deposited
in the Note Distribution Account an aggregate sum sufficient to pay the
amounts due on such Distribution Date or Redemption Date under the Notes,
such sum to be held in trust for the benefit of the Persons entitled thereto,
and (unless the Paying Agent is the Indenture Trustee) shall promptly notify
the Indenture Trustee of its action or failure so to act.
Any Paying Agent shall be appointed by Issuer Order with written notice
thereof to the Indenture Trustee and the Securities Insurer. Any Paying
Agent appointed by the Issuer shall be a Person who would be eligible to be
Indenture Trustee hereunder as provided in Section 6.11. The
INDENTURE (Series 199_-_) -- Page 22
Issuer shall not appoint any Paying Agent (other than the Indenture Trustee)
which is not, at the time of such appointment, a Depository Institution.
The Issuer will cause each Paying Agent other than the Administrator 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, 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 and the Securities Insurer
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 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 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
INDENTURE (Series 199_-_) -- Page 23
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 published in the English language, customarily
published on each Business Day and of general circulation in The City of
[New York], 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, at
the expense and direction of the Issuer, any other reasonable means of
notification of such repayment (including, but not limited to, mailing notice
of such repayment to Holders whose Notes have been called but have not been
surrendered for redemption or whose right to or interest in moneys due and
payable but not claimed is determinable from the records of the Indenture
Trustee or of any Paying Agent, at the last address of record for each such
Holder).
3.4 Existence.
(a) Subject to Section 3.4(b), the Issuer will keep in
full effect its existence, rights and franchises as a
business trust under the laws of the State of
[Delaware] (unless it becomes, or any successor
Issuer hereunder is or becomes, organized under the
laws of any other State or of the United States of
America, in which case the Issuer 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.
(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 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.
INDENTURE (Series 199_-_) -- Page 24
3.5 Protection of Collateral. The Issuer will from time to time and upon
the direction of the Securities Insurer execute and deliver all such
supplements and amendments hereto and all such financing statements,
continuation statements, instruments of further assurance and other
instruments, and will take such other action necessary or advisable
to:
(i) 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; or
(v) preserve and defend title to the Collateral and the rights of
the Indenture Trustee, the Noteholders and the Securities
Insurer 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 3.5.
3.6 Annual Opinions as to Collateral.
On or before ___________ 15th in each calendar year, beginning in 199_,
the Issuer shall furnish to the Indenture Trustee an Opinion of Counsel
either stating that, in the opinion of such counsel, such action has been
taken with respect to the recording, filing, re-recording and refiling of
this Indenture, any indentures supplemental hereto and any other requisite
documents and with respect to the execution and filing of any financing
statements and continuation statements as is necessary to maintain the lien
and security interest created by this Indenture and reciting the details of
such action or stating that in the opinion of such counsel no such action is
necessary to maintain such lien and security interest. Such Opinion of
Counsel shall also describe the recording, filing, re-recording and refiling
of this Indenture, any indentures supplemental hereto and any other requisite
documents and the execution and filing of any financing statements and
continuation statements that will, in the opinion of such counsel, be
required to maintain the lien and security interest of this Indenture until
__________ 15th of the following calendar year.
3.7 Performance of Obligations; Servicing of Mortgage Loans.
INDENTURE (Series 199_-_) -- Page 25
(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 this
Indenture, the Sale and Servicing Agreement 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
and the Securities Insurer 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.
The Administrator must at all times be the same person
as the Indenture Trustee.
(c) The Issuer will punctually perform and observe all of
its obligations and agreements contained in this
Indenture, the Basic Documents and in the
instruments and agreements included in the 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, the Securities
Insurer, and the Holders of at least a majority of
the Outstanding Amount of the Notes.
(d) If the Issuer shall have knowledge of the occurrence
of an Event of Default under the Sale and Servicing
Agreement, the Issuer shall promptly notify the
Indenture Trustee, the Securities Insurer and the
Rating Agencies thereof, and shall specify in such
notice the action, if any, the Issuer is taking
with respect of such default. if such an
INDENTURE (Series 199_-_) -- Page 26
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 Mortgage Loans, the Issuers
hall take all reasonable steps available to it to
remedy such failure.
(e) As promptly as possible after the giving of
notice of termination to the Servicer of the
Servicer's rights and powers pursuant to Section
10.01 of the Sale and Servicing Agreement, the
Issuer, upon the prior written consent of or upon
the direction of the Securities Insurer, shall
appoint a successor servicer (the "Successor
Servicer"), and such Successor Servicer shall
accept its appointment by a written assumption in a
form acceptable to the Indenture Trustee. In the
event that a Successor Servicer has not been
appointed and accepted its appointment at the time
when the Servicer ceases to act as Servicer, the
Indenture Trustee without further action shall
automatically be appointed the Successor Servicer.
The Indenture Trustee may resign as the Servicer by
giving written notice of such resignation to the
Issuer and in such event will be released from such
duties and obligations, such release not to be
effective until the date a new servicer enters into
a servicing agreement with the Issuer as provided
below. Upon delivery of any such notice to the
Issuer, the Issuer shall obtain a new servicer as
the Successor Servicer under the Sale and Servicing
Agreement. Any Successor Servicer other than the
Indenture Trustee shall (i) satisfy the criteria
specified in Section 9.04(b) of the Sale and
Servicing Agreement and (ii) enter into a servicing
agreement with the Issuer having substantially the
same provisions as the provisions of the Sale and
Servicing Agreement applicable to the Servicer. If
within 30 days after the delivery of the notice
referred to above, the Issuer shall not have
obtained such a new servicer, the Indenture Trustee
may appoint, or may petition a court of competent
jurisdiction to appoint, a Successor Servicer. In
connection with any such appointment, the Indenture
Trustee may make such arrangements for the
compensation of such successor as it and such
successor shall agree, subject to the limitations
set forth below and in the Sale and Servicing
Agreement, and in accordance with Section 10.02 of
the Sale and Servicing Agreement, the Issuer shall
enter into an agreement with such successor for the
servicing of the Mortgage Loans (such agreement to
be in form and substance satisfactory to the
Indenture Trustee and the Securities Insurer). If
the Indenture Trustee shall succeed to the
Servicer's duties as servicer of the Mortgage Loans
as provided herein, it shall do so in its
individual capacity and not in its capacity as
Indenture Trustee and, accordingly, the provisions
of Article VI hereof shall be inapplicable to the
Indenture Trustee in its duties as successor
Servicer and the servicing
INDENTURE (Series 199_-_) -- Page 27
of the Mortgage Loans. In case the Indenture
Trustee shall become successor Servicer under
the Sale and Servicing Agreement, the Indenture
Trustee shall be entitled to appoint as Servicer
any one of its Affiliates, provided that it shall
be fully liable for the actions and omissions
of such Affiliate in such capacity as Successor
Servicer.
(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 and the Securities Insurer. As
soon as a successor Servicer is appointed and
approved by the Securities Insurer, 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 and the Securities Insurer, or,
if a Securities Insurer Default has occurred and is
continuing, the Holders of at least a majority in
Outstanding Amount of the Notes, 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
provided in the Sale and Servicing Agreement) or
the Basic Documents, or waive timely performance or
observance by the Servicer or the Seller 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 the Holders of all the
outstanding Notes. If any such amendment,
modification, supplement or waiver shall be so
consented to by the Indenture Trustee and the
Securities Insurer or, if a Securities Insurer
Default has occurred and is continuing, such
Holders, the Issuer agrees, promptly following a
request by the Indenture Trustee or the Securities
Insurer 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.
3.8 Negative Covenants. So long as any Notes are Outstanding, the
Issuer shall not:
INDENTURE (Series 199_-_) -- Page 28
(i) except as expressly permitted by this Indenture or the
Sale and Servicing Agreement, sell, transfer, exchange or
otherwise dispose of any of the properties or assets of
the Issuer, including those included in the Collateral,
unless directed to do so by the Indenture Trustee or the
Securities Insurer;
(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 Collateral;
(iii) engage in any business or activity other than as permitted
by the Trust Agreement or other than in connection with, or
relating to, the issuance of Notes pursuant to this
Indenture, or amend the Trust Agreement as in effect
on the Closing Date other than in accordance with Section
11.1 thereof,
(iv) issue debt obligations under any other 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 under
this Indenture except as may be expressly permitted
hereby, (B) permit any lien, charge, excise, claim,
security interest, mortgage or other encumbrance (other
than the lien of this Indenture) to be created on or
extend to or otherwise arise upon or burden the Collateral
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 of the Mortgaged Properties and arising
solely as a result of an action or omission of the related
Obligor) or (C) permit the lien of this Indenture not to
constitute a valid first priority (other than with respect
to any such tax, mechanics' or other lien) security
interest in the Collateral;
(viii) remove the Administrator without cause unless the Rating
Agency Condition shall have been satisfied in connection
with such removal; or
INDENTURE (Series 199_-_) -- Page 29
(ix) take any other action or fail to take any action which may cause the
Issuer 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 and the
corresponding regulations.
3.9 Annual Statement as to Compliance. The Issuer will deliver to the
Indenture Trustee and the Securities Insurer, within 120 days after the
end of each fiscal year of the Issuer (commencing with the fiscal year
199_), 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 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.
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.
3.11 Servicer's Obligations. The Issuer shall cause the Servicer to comply
with Sections 5.01, 6.01, 7.07 and Article IX of the Sale and Servicing
Agreement.
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, the Securityholders and the holders of
the Residual Interest as contemplated by, and to the extent funds are
available for such purpose under, the Sale and Servicing Agreement or the
Trust
INDENTURE (Series 199_-_) -- Page 30
Agreement and (y) payments to the Indenture Trustee pursuant to Section
1(a)(ii) of the Administration Agreement. The Issuer will not, directly
or indirectly, make or cause to be made payments to or distributions from
the Collection Account except in accordance with this Indenture and the
Basic Documents.
3.13 Treatment of Notes as Debt for Tax Purposes. The Issuer shall, and shall
cause the Administrator to, treat the Notes as indebtedness for all
federal and state tax purposes.
3.14 Notice of Events of Default. The Issuer shall give the Indenture Trustee,
the Securities Insurer and the Rating Agencies prompt written notice of
each Event of Default hereunder and each default on the part of the
Servicer or the Seller of its obligations under the Sale and Servicing
Agreement.
3.15 Further Instruments and Acts. Upon request of the Indenture Trustee or
the Securities Insurer, 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
SATISFACTION AND DISCHARGE
4.1 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 3.3,
3.4, 3.5, 3.8 and 3.10 hereof, (v) the rights, obligations and immunities
of the Indenture Trustee hereunder (including the rights of the Indenture
Trustee under Section 6.7 and the obligations of the Indenture Trustee
under Section 4.2) 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 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 2.4
and (ii) Notes for whose payment money has
theretofore been deposited in trust or
INDENTURE (Series 199_-_) -- Page 31
segregated and held in trust by the Issuer and
thereafter repaid to the Issuer or discharged
from such trust, as provided in Section 3.3)
have been delivered to the Indenture Trustee
for cancellation; or
(2) all Notes not theretofore delivered to the
Indenture Trustee for cancellation
a. have become due and payable,
b. will become due and payable at the Final Scheduled
Distribution Date within one year, or
c. 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, and the Issuer,
in the case of a., b. or c. above, has irrevocably
deposited or caused to be irrevocably deposited with the
Indenture Trustee cash or direct obligations of or
obligations guaranteed by the United States of America
(which will mature prior to the date such amounts are
payable), in trust for such purpose, in an amount sufficient
to pay and discharge the entire indebtedness on such Notes
not theretofore delivered to the Indenture Trustee for
cancellation when due to the Final Scheduled Distribution
Date of the Notes or Redemption Date (if Notes shall have
been called for redemption pursuant to Section 10.1), as the
case may be;
(B) the later of (a) eighteen months after payment in full
of all outstanding obligations under the Securities,
(b) the payment in full of all unpaid Trust Fees and
Expenses and all sums owing to the Securities Insurer
under the Insurance Agreement 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 has delivered to the Indenture Trustee an
Officer's Certificate, an Opinion of Counsel and (if
required by the TIA or the Indenture Trustee) an
Independent Certificate from a firm of certified
public accountants, each meeting the applicable
requirements of Section 11.1(a) and, subject to
Section 11.2, 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.
INDENTURE (Series 199_-_) -- Page 32
4.2 Application of Trust Money. All moneys deposited with the Indenture
Trustee pursuant to Sections 3.3 and 4.1 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 Holders of the particular
Notes 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 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.
4.3 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 3.3 and thereupon such Paying Agent shall be
released from all further liability with respect to such moneys.
ARTICLE
REMEDIES
5.1 Events of Default. "Event of Default,"wherever used herein, means any one
of the following events (whatever the reason for such Event of Default and
whether it shall be voluntary or involuntary or be effected by operation
of law or pursuant to any judgment, decree or order of any court or any
order, rule or regulation of any administrative or governmental body):
(a) [default in the payment of any interest on any Note when the
same becomes due and payable; or]
(b) [default in the payment of the principal of or any
installment of the principal of any Note when the same
becomes due and payable; or]
(c) [default in the observance or performance of any covenant or
agreement of the Issuer made in this Indenture (other than a
covenant or agreement, a default in the observance or
performance of which is elsewhere in this Section
specifically dealt with), or any representation or warranty
of the Issuer made in this Indenture, the Insurance
Agreement, the Sale and Servicing Agreement or in any
certificate or other writing delivered pursuant hereto or
in connection herewith proving to have been incorrect in any
material respect as of the time when the same shall have
been made, and such default shall continue or not be cured,
or the circumstance or condition in respect of which such
misrepresentation or warranty was incorrect shall not
INDENTURE (Series 199_-_) -- Page 33
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 and the Indenture Trustee by the Holders of at
least [25%] of the Outstanding Amount of the 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]
(d) [default in the observance or performance of any covenant or
agreement of the Company made in the Trust Agreement or any
representation or warranty of the Company made in the Trust
Agreement, 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 and the Indenture Trustee by the Holders of at
least [25%] of the Outstanding Amount of the 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;]
(e) [the filing of a decree or order for relief by a court
having jurisdiction in the premises in respect of the Issuer
or any substantial part 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 appointing a receiver, liquidator, assignee, custodian,
trustee, sequestrator or similar official of the Issuer or
for any substantial part of the Collateral, or ordering the
winding-up or liquidation of the Issuer's affairs, and such
decree or order shall remain unstayed and in effect for a
period of 60 consecutive days; or]
(f) [the commencement by the Issuer 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 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 or for any
substantial part of the Collateral, or the making by the
Issuer of any general assignment for the benefit of
creditors, or the failure by the Issuer generally to pay
its debts as such debts become due, or the taking of any
action by the Issuer in furtherance of any of the
foregoing.]
INDENTURE (Series 199_-_) -- Page 34
The Issuer shall deliver to the Indenture Trustee and the Securities
Insurer, 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 (c) and
(d) above, its status and what action the Issuer is taking or proposes to
take with respect thereto.
5.2 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 Securities Insurer or the Holders of Notes representing
not less than a majority of the Outstanding Amount of the Notes 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 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 money due has been
obtained by the Indenture Trustee as hereinafter in this Article V provided,
the Holders of Notes representing a majority of the Outstanding Amount of the
Notes, 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:
(i) all payments of principal of and 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
(ii) 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
(iii) 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.
No such rescission shall affect any subsequent default or impair any right
consequent thereto.
5.3 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
INDENTURE (Series 199_-_) -- Page 35
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 and at the direction of
the Securities Insurer, pay to the Indenture Trustee, for
the benefit of the Holders of the Notes and the
Securities Insurer, the whole amount then due and payable
on such Notes for principal and 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 the Securities Insurer and their respective
agents and counsel.
(b) In case the Issuer shall fail forthwith to pay such
amounts upon such demand, the Indenture Trustee, in its own
name and as trustee of an express trust, shall at the
direction of the Securities Insurer, and if a Securities
Insurer Default has occurred and is continuing, the
Indenture Trustee may and shall at the direction of the
majority of the Holders of the Notes, 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.
(c) If an Event of Default occurs and is continuing,
the Indenture Trustee shall, at the direction of the
Securities Insurer, and if a Securities Insurer Default
has occurred and is continuing, the Indenture Trustee may
and shall at the direction of the majority of the Holders
of the Notes, as more particularly provided in Section
5.4, in its discretion, proceed to protect and enforce
its rights and the rights of the Securities Insurer and
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
INDENTURE (Series 199_-_) -- Page 36
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, shall be entitled
and empowered, upon the direction of the Securities Insurer,
by intervention in such Proceedings or otherwise:
(i) to file and prove a claim or claims for the whole amount of
principal and interest owing and unpaid in respect of the Notes and to file such
other papers or documents as may be necessary or advisable in order to have the
claims of the Indenture Trustee (including any claim for reasonable compensation
to the Indenture Trustee, each predecessor Indenture Trustee and the Securities
Insurer, and their respective agents, attorneys and counsel, and for
reimbursement of all expenses and liabilities incurred, and all advances made,
by the Indenture Trustee and each predecessor Indenture Trustee (except as a
result of negligence or bad faith), the Securities Insurer and of the
Noteholders allowed in such Proceedings;
(ii) unless prohibited by applicable law and regulations, to vote
on behalf of the Holders of Notes in any election of a trustee, a standby
trustee or Person performing similar functions in any such Proceedings;
(iii) to collect and receive any 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, the Securities Insurer 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, the Securities Insurer or the Holders of Notes 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 and the
Securities Insurer to make payments to the Indenture Trustee and, in the event
that the Indenture Trustee shall consent to the making of payments directly to
such Noteholders and the Securities Insurer, to pay to the Indenture Trustee
such amounts as shall be sufficient to cover reasonable compensation to the
Indenture Trustee, each predecessor Indenture Trustee and their respective
agents, attorneys and counsel, and all other expenses and liabilities incurred,
and all advances made, by the Indenture Trustee and each predecessor Indenture
Trustee except as a result of negligence or bad faith.
INDENTURE (Series 199_-_) -- Page 37
(e) Nothing herein contained shall be deemed to authorize the
Indenture Trustee to authorize or consent to or vote for
or accept or adopt on behalf of any Noteholder or the
Securities Insurer any plan of reorganization, arrangement,
adjustment or composition affecting the Notes or the rights
of any Holder thereof or the Securities Insurer 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 and
attorneys, shall be for the ratable benefit of the Holders of
the Notes and the Securities Insurer.
(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.
5.4 Remedies; Priorities.
(a) If an Event of Default shall have occurred and be continuing,
the Indenture Trustee shall, at the direction of the
Securities Insurer, and if a Securities Insurer Default has
occurred and is continuing, the Indenture Trustee may and at
the direction of a majority of the Holders of the Notes shall
do one or more of the following (subject to Section 5.5):
(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;
INDENTURE (Series 199_-_) -- Page 38
(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, the Securities Insurer 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 (A) the Holders of [100%] of
the Outstanding Amount of the 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
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 [66-2/3%] of the Outstanding Amount of the Notes. In determining
such sufficiency or insufficiency with respect to clause (B) and (C), 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: to the Indenture Trustee for the Indenture Trustee Fee then due
and any costs or expenses incurred by it in connection with the enforcement of
the remedies provided for in this Article V and to the Owner Trustee for the
Owner Trustee Fee then due;
SECOND: to the Securities Insurer for the Guaranty Insurance Premium
then due and unpaid;
THIRD: to the Servicer for the Servicing Fee then due and unpaid;
FOURTH: to Noteholders for amounts due and unpaid on the Notes for
interest (including any premium), pro rata, according to the amounts due and
payable on the Notes for interest (including any premium);
FIFTH: to Noteholders for amounts due and unpaid on the Notes for
principal, pro rata, according to the amounts due and payable on the Notes for
principal, until the Outstanding Amount of the Notes is reduced to zero;
SIXTH: to the Owner Trustee or Co-Owner Trustee, as applicable, for
amounts required to be distributed to the Certificateholders pursuant to the
Trust Agreement;
INDENTURE (Series 199_-_) -- Page 39
SEVENTH: to the Securities Insurer for any amounts then due and
payable under the Insurance Agreement;
EIGHTH: to the Servicer for any amounts then due and payable as the
Servicing Advance Reimbursement Amount under the Sale and Servicing Agreement;
and
NINTH: to the Owner Trustee or Co-Owner Trustee, as applicable, for
any amounts to be distributed, pro rata, to the holders of the Residual
Interest.
The Indenture Trustee may fix a record date and payment date for any payment
to be made to the Noteholders pursuant to this Section. At least 15 days before
such record date, the Indenture Trustee shall mail to each Noteholder, the
Securities Insurer and the Issuer a notice that states the record date, the
payment date and the amount to be paid.
5.5 Optional Preservation of the Collateral. If the Notes have been
declared to be due and payable under Section 5.2 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.
5.6 Limitation of Suits. No Holder of any Note shall have any right to
institute any Proceeding, judicial or otherwise, with respect to this
Indenture or for the appointment of a receiver or trustee, or for any
other remedy hereunder for so long as a Securities Insurer Default has
not occurred or is not continuing and if a Securities Insurer Default
has occurred and is continuing, unless:
(a) such Holder has previously given written notice to the
Indenture Trustee of a continuing Event of Default;
(b) the Holders of not less than [25%] of the Outstanding Amount
of the 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 Holder or Holders have offered to the Indenture Trustee
reasonable indemnity against the costs, expenses and
liabilities to be incurred in complying with such request;
INDENTURE (Series 199_-_) -- Page 40
(d) the Indenture Trustee for 60 days after its receipt of such
notice, request and offer of indemnity has failed to
institute such Proceedings; and
(e) no direction inconsistent with such written request has been
given to the Indenture Trustee during such 60-day period by
the Holders of a majority of the Outstanding Amount of the
Notes.
It is understood and intended that no one or more Holders of Notes shall
have any right in any manner whatever by virtue of, or by availing of, any
provision of this Indenture to affect, disturb or prejudice the rights of any
other Holders of Notes or to obtain or to seek to obtain priority or preference
over any other Holders or to enforce any right under this Indenture, except in
the manner herein provided.
In the event the Indenture Trustee shall receive conflicting or inconsistent
requests and indemnity from two or more groups of Holders of Notes, each
representing less than a majority of the Outstanding Amount of the Notes, the
Indenture Trustee in its sole discretion may determine what action, if any,
shall be taken, notwithstanding any other provisions of this Indenture.
5.7 Unconditional Rights of Noteholders To Receive Principal and Interest.
Notwithstanding any other provisions in this Indenture, the Holder of
any Note shall have the right, which is absolute and unconditional, to
receive payment of the principal of and interest, if any, on such Note
on or after the Final Scheduled Distribution 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 Holder.
5.8 Restoration of Rights and Remedies. If the Indenture Trustee, the
Securities Insurer 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, the Securities Insurer
or to such Noteholder, then and in every such case the Issuer, the
Indenture Trustee, the Securities Insurer 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.
5.9 Rights and Remedies Cumulative. No right or remedy herein conferred
upon or reserved to the Indenture Trustee, the Securities Insurer 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
INDENTURE (Series 199_-_) -- Page 41
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.
5.10 Delay or Omission Not a Waiver. No delay or omission of the Indenture
Trustee, the Securities Insurer or any Holder of any Note 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, the
Securities Insurer or to the Noteholders may be exercised from time to
time, and as often as may be deemed expedient, by the Indenture
Trustee, the Securities Insurer or by the Noteholders, as the case may
be, subject, in each case, however, to the right of the Securities
Insurer to control any such right and remedy, except as provided in
Section 11.21.
5.11 Control by Noteholders. The Holders of a majority of the Outstanding
Amount of the Notes shall have the right to direct the time, method and
place of conducting any Proceeding for any remedy available to the
Indenture Trustee with respect to the Notes or exercising any trust or
power conferred on the Indenture Trustee; provided that:
(a) such direction shall not be in conflict with any rule of law
or with this Indenture;
(b) subject to the express terms of Section 5.4, any direction to
the Indenture Trustee to sell or liquidate the Collateral
shall be by Holders of Notes representing not less than
[100%] of the Outstanding Amount of the Notes;
(c) if the conditions set forth in Section 5.5 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 less
than [100%] of the Outstanding Amount of the Notes 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.
Notwithstanding the rights of the Securities Insurer and the Noteholders set
forth in this Section, subject to Section 6.1, 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.
INDENTURE (Series 199_-_) -- Page 42
5.12 Waiver of Past Defaults. Prior to the declaration of the acceleration
of the maturity of the Notes as provided in Section 5.2, the Holders
of Notes representing not less than a majority of the Outstanding
Amount of the Notes 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 the Securities Insurer or the Holder of each Note, as
applicable. In the case of any such waiver, the Issuer, the
Indenture Trustee, the Securities Insurer and the Holders of the Notes
shall be restored to their former positions and rights hereunder,
respectively; but no such waiver shall extend to any subsequent or
other 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.
5.13 Undertaking for Costs. All parties to this Indenture agree, and each
Holder of any Note by such Holder'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 shall not apply to (a) any suit instituted
by the Indenture Trustee or the Securities Insurer, (b) any suit
instituted by any Noteholder, or group of Noteholders, in each case
holding in the aggregate more than [10%] of the Outstanding Amount of
the Notes 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 the respective due dates expressed in such Note and in this
Indenture (or, in the case of redemption, on or after the Redemption
Date).
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.
INDENTURE (Series 199_-_) -- Page 43
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 5.4(b).
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 Seller and the Servicer, as applicable, of each of
their obligations to the Issuer under or in connection with
the Sale and Servicing Agreement, and to exercise any and
all rights, remedies, powers and privileges lawfully
available to the Issuer under or in connection with the 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 Seller
or the Servicer thereunder and the institution of legal or
administrative actions or proceedings to compel or secure
performance by the Seller or the Servicer of each of their
obligations under the Sale and Servicing 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 Holders of [66-2/3%] of the
Outstanding Amount of the Notes shall, exercise all rights,
remedies, powers, privileges and claims of the Issuer
against the Seller or the Servicer under or in connection
with the Sale and Servicing Agreement, including the right
or power to take any action to compel or secure performance
or observance by the Seller 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.
INDENTURE (Series 199_-_) -- Page 44
ARTICLE
THE INDENTURE TRUSTEE
6.1 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 undertakes to perform such duties and only
such duties as are specifically set forth in this Indenture and no implied
covenants or obligations shall be read into this Indenture against the
Indenture Trustee; and
(ii) in the absence of bad faith on its part, the Indenture Trustee
may conclusively rely, as to the truth of the statements and the
correctness of the opinions expressed therein, upon certificates or
opinions furnished to the Indenture Trustee and conforming to the
requirements of this Indenture; however, the Indenture Trustee shall
examine the certificates and opinions to determine whether or not they
conform to the requirements of this Indenture.
(c) The Indenture Trustee may not be relieved from liability for
its own negligent action, its own negligent failure to act
or its own willful misconduct, except that:
(i) this paragraph does not limit the effect of paragraph (b) of this
Section;
(ii) the Indenture Trustee shall not be liable for any error of
judgment made in good faith by a Responsible Officer unless it is proved
that the Indenture Trustee was negligent in ascertaining the pertinent
facts; and
(iii) the Indenture Trustee shall not be liable with respect to any
action it takes or omits to take in good faith in accordance with a
direction received by it pursuant to Section 5.11.
(d) Every provision of this Indenture that in any way relates to
the Indenture Trustee is subject to paragraphs (a), (b), (c)
and (g) of this Section.
INDENTURE (Series 199_-_) -- Page 45
(e) The Indenture Trustee shall not be liable for interest on
any money received by it except as the Indenture Trustee may
agree in writing with the Issuer.
(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.
(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 further
provided that nothing in this Section 6.1(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
6.7. In determining that such repayment or indemnity is not
reasonably assured to it, the Indenture Trustee must
consider not only the likelihood of repayment or indemnity
by or on behalf of the Issuer but also the likelihood of
repayment or indemnity from amounts payable to it from the
Collateral pursuant to Section 6.7.
(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 and to the provisions of the TIA.
INDENTURE (Series 199_-_) -- Page 46
6.2 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 willful misconduct or gross
negligence 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.
6.3 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 Sections 6.11 and 6.12.
6.4 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
INDENTURE (Series 199_-_) -- Page 47
issued in connection with the sale of the Notes or in the Notes other
than the Indenture Trustee's certificate of authentication.
6.5 Notice of Defaults. If a Default occurs and is continuing and if it
is known to a Responsible Officer of the Indenture Trustee, the
Indenture Trustee shall mail to the Securities Insurer and each
Noteholder notice of the Default within 90 days after it occurs.
Except in the case of a Default in payment of principal of or interest
on any Note (including payments pursuant to the mandatory redemption
provisions of such Note), the Indenture Trustee may withhold the
notice if and so long as a committee of its Responsible Officers in
good faith determines that withholding the notice is in the interests
of Noteholders.
6.6 Reports by Indenture Trustee to Holders. The Indenture Trustee shall
deliver to each Noteholder such information as may be required to
enable such holder to prepare its federal and state income tax
returns.
6.7 Compensation and Indemnity. As compensation for its services
hereunder, the Indenture Trustee shall be entitled to receive, on each
Distribution Date, the Indenture Trustee's Fee pursuant to Section
8.2(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 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
against any and all loss, liability or expense (including attorneys'
fees) incurred by it in connection with the administration of this
trust and the performance of its duties hereunder. 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 to
so notify the Issuer and the Servicer shall not relieve the Issuer of
its obligations hereunder. The Issuer shall or shall cause the
Servicer to defend any such claim, and the Indenture Trustee may have
separate counsel and the Issuer shall or shall cause the Servicer to
pay the fees and expenses of such counsel. 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.
The Issuer's payment obligations to the Indenture Trustee pursuant to this
Section shall survive the discharge of this Indenture. When the Indenture
Trustee incurs expenses after the occurrence of a Default specified in
Section 5.1(e) or (f) 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.
INDENTURE (Series 199_-_) -- Page 48
6.8 Replacement of Indenture Trustee. No resignation or removal of the
Indenture Trustee and no appointment of a successor Indenture Trustee
shall become effective until the acceptance of appointment by the
successor Indenture Trustee pursuant to this Section. The Indenture
Trustee may resign at any time by so notifying the Issuer and the
Securities Insurer. The Holders of a majority in Outstanding Amount
of the Notes may remove the Indenture Trustee by so notifying the
Indenture Trustee and may appoint a successor Indenture Trustee. The
Issuer shall remove the Indenture Trustee upon the prior written
consent of the Securities Insurer if:
(a) the Indenture Trustee fails to comply with Section 6.11;
(b) the Indenture Trustee is adjudged a bankrupt or insolvent;
(c) a receiver or other public officer takes charge of the
Indenture Trustee or its property; or
(d) the Indenture Trustee otherwise becomes incapable of acting.
If the Indenture Trustee resigns or is removed or if a vacancy exists in
the office of 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 acceptable to the
Securities Insurer.
A successor Indenture Trustee shall deliver a written acceptance of its
appointment to the retiring Indenture Trustee, the Securities Insurer 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 Holders of a majority in Outstanding Amount of the
Notes may petition any court of competent jurisdiction for the appointment of
a successor Indenture Trustee.
If the Indenture Trustee fails to comply with Section 6.11, any Noteholder
may petition 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, the Issuer's and the Administrator's obligations under Section 6.7
shall continue for the benefit of the retiring Indenture Trustee.
INDENTURE (Series 199_-_) -- Page 49
6.9 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, that such corporation or
banking association shall be otherwise qualified and eligible under
Section 6.11. The Indenture Trustee shall provide the Securities
Insurer and the Rating Agencies 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.
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, with the prior written consent of the Securities
Insurer, 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, such powers, duties, obligations, rights and trusts
as the Indenture Trustee may consider necessary or
desirable. No co-trustee or separate trustee hereunder
shall be required to meet the terms of eligibility as a
successor trustee under Section 6.11 and no notice to
Noteholders of the appointment of any co-trustee or separate
trustee shall be required under Section 6.8 hereof; provided
that the Indenture Trustee shall deliver notice of any such
co-trustee or separate trustee to the Securities Insurer.
(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:
INDENTURE (Series 199_-_) -- Page 50
(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
Agreement 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 Agreement 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.
6.11 Eligibility; Disqualification. The Indenture Trustee shall at
all times satisfy the requirements of TIA Section 310(a). The
Indenture Trustee shall have a combined capital and surplus of at
least [$50,000,000] as set forth in its most recent published annual
report of condition and it or its parent shall have a long-term debt
rating of
INDENTURE (Series 199_-_) -- Page 51
[A3] or better by [Moody's] or shall otherwise be acceptable to
[Moody's]. The Indenture Trustee shall comply with TIA Section
310(b), including the optional provision permitted by the second
sentence of TIA Section 310(b)(9); provided, however, that there
shall be excluded from the operation of TIA Section 310(b)(1) any
indenture or indentures under which other securities of the Issuer
are outstanding if the requirements for such exclusion set forth in
TIA Section 310(b)(1) are met.
6.12 Preferential Collection of Claims Against Issuer. The
Indenture Trustee shall comply with TIA Section 311(a), excluding
any creditor relationship listed in TIA Section 311(b). An
Indenture Trustee who has resigned or been removed shall be subject
to TIA Section 311(a) to the extent indicated.
ARTICLE
NOTEHOLDERS' LISTS AND REPORTS
7.1 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 each Record
Date, a list, in such form as the Indenture Trustee may reasonably
require, of the names and addresses of the Holders of Notes as of
such Record Date, (b) at such other times as the Indenture Trustee
may request in writing, within 30 days after receipt by the 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.
7.2 Preservation of Information; Communications to Noteholders.
(a) The Indenture Trustee shall preserve, in as current a
form as is reasonably practicable, the names and addresses
of the Holders of Notes contained in the most recent list
furnished to the Indenture Trustee as provided in Section
7.1 and the names and addresses of Holders of Notes
received by the Indenture Trustee in its capacity as Note
Registrar. The Indenture Trustee may destroy any list
furnished to it as provided in such Section 7.1 upon
receipt of a new list so furnished.
(b) Noteholders may communicate pursuant to TIA Section
312(b) with other Noteholders with respect to their rights
under this Indenture or under the Notes.
(c) The Issuer, the Indenture Trustee and the Note
Registrar shall have the protection of TIA Section 312(c).
INDENTURE (Series 199_-_) -- Page 52
7.3 Reports by Issuer.
(a) The Issuer shall:
(i) file with the Indenture Trustee and the Securities Insurer,
within 15 days after the Issuer is required to file the same with the
Commission, copies of the annual reports and of the information,
documents and other reports (or copies of such portions of any of the
foregoing as the Commission may from time to time by rules and
regulations prescribe) that the Issuer may be required to file with the
Commission pursuant to Section 13 or 15(d) of the Exchange Act;
(ii) file with the Indenture Trustee and the Securities Insurer and
the Commission in accordance with the rules and regulations prescribed
from time to time by the Commission such additional information,
documents and reports with respect to compliance by the Issuer with the
conditions and covenants of this Indenture as may be required from time
to time by such rules and regulations; and
(iii)supply to the Indenture Trustee (and the Indenture Trustee
shall transmit by mail to all Noteholders described in TIA Section
313(c)) such summaries of any information, documents and reports required
to be filed by the Issuer pursuant to clauses (i) and (ii) of this
Section 7.3(a) and by rules and regulations prescribed from time to time
by the Commission.
(b) Unless the Issuer otherwise determines, the fiscal year of
the Issuer shall end on December 31 of each year.
7.4 Reports by Indenture Trustee. If required by TIA Section
313(a), within 60 days after each ___________, beginning with
____________, 199_, the Indenture Trustee shall mail to the
Securities Insurer and to each Noteholder as required by TIA Section
313(c) a brief report dated as of such date that complies with TIA
Section 313(a). The Indenture Trustee also shall comply with TIA
Section 313(b).
A copy of each report at the time of its mailing to Noteholders shall be
filed by the Indenture Trustee with the Commission and each securities
exchange, if any, on which the Notes are listed. The Issuer shall notify the
Indenture Trustee if and when the Notes are listed on any securities
exchange.
INDENTURE (Series 199_-_) -- Page 53
ARTICLE
ACCOUNTS, DISBURSEMENTS AND RELEASES
8.1 Collection of Money.
(a) 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 fiscal agent or
other intermediary, all money and other property payable
to or receivable by the Indenture Trustee pursuant to this
Indenture. The Indenture Trustee shall apply all such
money received by it as provided in this Indenture. Except
as otherwise expressly provided in this Indenture, if any
default occurs in the making of any payment or performance
under any agreement or instrument that is part of the
Collateral, the Indenture Trustee may, and upon written
request of the Securities Insurer shall, 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.
(b) Claims Under Guaranty Policy. The Notes and the
Certificates will be insured by the Guaranty Policy
pursuant to the terms set forth therein, notwithstanding
any provisions to the contrary contained in this Indenture
or the Sale and Servicing Agreement. All amounts received
under the Guaranty Policy shall be used solely for the
payment to Securityholders of principal and interest on
the Notes and the Certificates.
8.2 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 the Co-Owner Trustee for the benefit of
the Certificateholders, the Trust Accounts as provided in
Article V of the Sale and Servicing Agreement. The
Indenture Trustee or Co-Owner Trustee shall deposit
amounts into the Trust Accounts in accordance with the
terms hereof, the Sale and Servicing Agreement and the
Servicer's Monthly Remittance Report.
(b) On or before the third Business Day prior to each
Distribution Date, the Indenture Trustee shall withdraw
from the Collection Account,
INDENTURE (Series 199_-_) -- Page 54
the Pre-Funding Account, the Capitalized Interest Account
and the Reserve Account, as applicable, the Available
Collection Amount and the Reserve Account Withdrawal
Amount, if any, with respect to the preceding Due Period
pursuant to Section 5.01(b)(2) of the Sale and Servicing
Agreement and will deposit such amount into the Note
Distribution Account. No later than the second Business
Day prior to each Distribution Date, to the extent funds
are available in the Note Distribution Account, the
Indenture Trustee shall either retain funds in the Note
Distribution Account or make the withdrawals from the Note
Distribution Account and deposits into the other Trust
Accounts for distribution on such Distribution Date as
required pursuant to Section 5.01(c) of the Sale and
Servicing Agreement.
(c) On each Distribution Date and Redemption Date, to the
extent funds are available in the Note Distribution
Account, the Indenture Trustee shall make the following
distributions from the amounts on deposit in the Note
Distribution Account in the following order of priority
(except as otherwise provided in Section 5.4(b)):
(i) (A) to the Servicer, an amount equal to the Servicing
Compensation (net of any amounts retained prior to deposit
into the Collection Account pursuant to Section 5.01(b)(1)
of the Sale and Servicing Agreement) and all unpaid
Servicing Compensation from prior due periods, (B) to the
Securities Insurer, an amount equal to the Guaranty
Insurance Premium and all unpaid Guaranty Insurance
Premiums from prior Due Periods, (C) to the Indenture
Trustee, an amount equal to the Indenture Trustee Fee and
all unpaid Indenture Trustee Fees from prior Due Periods,
and (D) to the Owner Trustee, an amount equal to the Owner
Trustee Fee and all unpaid Owner Trustee Fees from prior
Due Periods;
(ii) only to the extent of funds withdrawn from the
Pre-Funding Account and deposited in the Note Distribution
Account by the Indenture Trustee pursuant to Section
5.03(c) of the Sale and Servicing Agreement (net of any
amount deposited in the Certificate Distribution Account
from the Note Distribution Account for distribution to
Certificateholders pursuant to Subsection 5.01(c)(ii) of
the Sale and Servicing Agreement), pro rata, to the
Holders of the Notes based on the Principal Balance, to
reduce the Principal Balance thereof; provided that if the
amount of such funds equals or is less than [$50,000],
then such amount shall be distributed sequentially to the
Noteholders to reduce the Principal Balances thereof;
INDENTURE (Series 199_-_) -- Page 55
(iii) to the Holders of the Notes, the Noteholders' Interest
Distributable Amount for such Distribution Date; provided,
that if there are not sufficient funds in the Note
Distribution Account to pay the entire amount of accrued
and unpaid interest then due on the Notes, the amount in
the Note Distribution Account shall be applied to the
payment of such interest on the Notes pro rata on the
basis of the total such interest due on the Notes; and
(iv) to the Holders of the Notes, the Noteholders'
Principal Distributable Amount until the Outstanding
Amount of the Notes is reduced to zero.
(d) On each Distribution Date and each Redemption Date, to the extent of
the interest of the Indenture Trustee in the Certificate Distribution Account
(as described in Section 5.08(a) of the Sale and Servicing Agreement), the
Indenture Trustee hereby authorizes the Owner Trustee, the Co-Owner Trustee
or the Paying Agent, as applicable, to make the distributions from the
Certificate Distribution Account as required pursuant to Section 5.06(c) of
the Sale and Servicing Agreement.
(e) The Indenture Trustee shall make claims under the Guaranty Policy
pursuant to Section 5.02 of the Sale and Servicing Agreement and in
accordance with the Guaranty Policy. The Indenture Trustee shall deposit any
Guaranteed Payment received from the Security Insurer in the Note
Distribution Account for the portion of the Guaranteed Payment payable on the
Notes or in the Certificate Distribution Account for the portion of the
Guaranteed Payment payable on the related Certificate. For claims under the
Guaranty Policy for a Deficiency Amount, on the related Distribution Date,
the Indenture Trustee shall distribute such amount based upon the portion of
the Interest Distribution Amount and the portion of the Regular Distribution
Amount payable on the Notes to the Noteholders and payable on the related
Certificate to such Certificateholders in accordance with the terms of the
Sale and Servicing Agreement. For claims under the Guaranty Policy for a
Preference Amount, the Indenture Trustee shall distribute such amount in
accordance with the terms of the Guaranty Policy. All amounts received under
the Guaranty Policy shall be used solely for the payment to Securityholders
of principal and interest on the Notes and the Certificates, as applicable.
8.3 General Provisions Regarding Accounts.
(a) So long as no Default or Event of Default shall have
occurred and be continuing, all or a portion of the funds
in the Trust Accounts shall be invested in Permitted
Investments and reinvested by the Indenture Trustee at the
direction of the Affiliated Holder in accordance with the
provisions of Article V of the Sale and Servicing
Agreement. All income or other gain from investments of
moneys deposited in the Trust Accounts shall be deposited
by the Indenture Trustee into the Note Distribution
Account, and any loss resulting from such investments
shall be charged to such account. The Issuer will not
INDENTURE (Series 199_-_) -- Page 56
direct the Indenture Trustee to make any investment of
any funds or to sell any investment held in any of the
Trust Accounts 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,
and, in connection with any direction to the Indenture
Trustee to make any such investment or sale, if requested
by the Indenture Trustee, the Issuer shall deliver to the
Indenture Trustee an Opinion of Counsel, acceptable to
the Indenture Trustee, to such effect.
(b) Subject to Section 6.1(c), the Indenture Trustee
shall not in any way be held liable by reason of any
insufficiency in any of the Trust Accounts resulting from
any loss on any Eligible Investment included therein
except for losses attributable to the Indenture Trustee's
failure to make payments on such Eligible Investments
issued by the Indenture Trustee, in its commercial
capacity as principal obligor and not as trustee, in
accordance with their terms.
(c) If (i) the Issuer shall have failed to give investment
directions for any funds on deposit in the Trust Accounts to
the Indenture Trustee by 11:00 a.m. Eastern Time (or such
other time as may be agreed by the Issuer and Indenture
Trustee) on any Business Day or (ii) a Default or Event of
Default shall have occurred and be continuing with respect
to the Notes but the Notes shall not have been declared due
and payable pursuant to Section 5.2 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 5.5
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 Trust Accounts in one or
more Eligible Investments.
8.4 Servicer's Monthly Statements. On each Distribution Date, the Indenture
Trustee shall deliver the Servicer's Monthly Statement (as defined in the Sale
and Servicing Agreement) with respect to such Distribution Date to the DTC, the
Rating Agencies, and the Securities Insurer.
8.5 Release of Collateral.
(a) Subject to the payment of its fees and expenses pursuant to
Section 6.7, the Indenture Trustee may, and when required by
the provisions of this Indenture shall, execute instruments
to release property from the lien of this Indenture, or
convey the Indenture Trustee's interest in the same, in a
manner and under circumstancesthat are not
INDENTURE (Series 199_-_) -- Page 57
inconsistent with the provisions of this Indenture. 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 (i) the Certificateholders pursuant to Section 5.06(c)
of the Sale and Servicing Agreement, (ii) the Servicer
pursuant to Section 8.2(c)(i)(A) hereof, (iii) the
Securities Insurer pursuant to Section 8.2(c)(i)(B)
hereof, the Indenture Trustee pursuant to Section
8.2(c)(i)(C) hereof, and the Owner Trustee pursuant to
Section 8.2(c)(i)(D) hereof, 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. 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, an
Opinion of Counsel and (if required by the TIA)
Independent Certificates in accordance with TIA Sections
314(c) and 314(d)(1) meeting the applicable requirements
of Section 11.1.
8.6 Opinion of Counsel. The Indenture Trustee and the Securities Insurer
shall receive at least seven days notice when requested by the Issuer to
take any action pursuant to Section 8.5(a), accompanied by copies of any
instruments involved, and the Indenture Trustee shall also require, as a
condition to such action, an Opinion of Counsel, in form and substance
satisfactory to the Indenture Trustee, stating the legal effect of any such
action, outlining the steps required to complete the same, and concluding
that all conditions precedent to the taking of such action have been
complied with 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 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.
INDENTURE (Series 199_-_) -- Page 58
ARTICLE IX
SUPPLEMENTAL INDENTURES
9.1 Supplemental Indentures Without Consent of Noteholders.
(a) Without the consent of the Holders of
any Notes but with prior notice to the Rating Agencies
and with the prior written consent of the Securities
Insurer, the Issuer and the Indenture Trustee, when
authorized by an Issuer Order, at any time and from time
to time, may enter into one or more indentures
supplemental hereto (which shall conform to the
provisions of the Trust Indenture Act as in force at the
date of the execution thereof), in form satisfactory to
the Indenture Trustee, for any of the following purposes:
(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
Holders of the Notes, 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, that such action shall not adversely
affect the interests of the Holders of the Notes;
(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; or
(vii) to modify, eliminate or add to the provisions of this Indenture
to such extent as shall be necessary to effect the qualification of this
Indenture under the TIA or under any
INDENTURE (Series 199_-_) -- Page 59
similar federal statute hereafter enacted and to add to this Indenture such
other provisions as may be expressly required by the TIA.
The Indenture Trustee is hereby authorized to join in the execution of any
such supplemental indenture and to make any further appropriate agreements and
stipulations that may be therein contained.
(b) The Issuer and the Indenture Trustee,
with the prior written consent of the Securities Insurer,
when authorized by an Issuer Order, may, also without the
consent of any of the Holders of the Notes but with prior
consent of the Rating Agencies, enter into an indenture
or indentures supplemental hereto for the purpose of
adding any provisions to, or changing in any manner or
eliminating any of the provisions of, this Indenture or
of modifying in any manner the rights of the Holders of
the Notes under this Indenture; provided, however, that
such action shall not, as evidenced by (i) an Opinion of
Counsel or (ii) satisfaction of the Rating Agency
Condition, adversely affect in any material respect the
interests of any Noteholder.
9.2 Supplemental Indentures with Consent of Noteholders. The Issuer and the
Indenture Trustee, when authorized by an Issuer Order, also may, with prior
consent of the Rating Agencies, the Securities Insurer and with the consent of
the Holders of not less than a majority of the Outstanding Amount of the Notes,
by Act of such Holders delivered to the Issuer and the Indenture Trustee, enter
into an indenture or indentures supplemental hereto for the purpose of adding
any provisions to, or changing in any manner or eliminating any of the
provisions of, this Indenture or of modifying in any manner the rights of the
Holders of the Notes under this Indenture; provided, however, that no such
supplemental indenture shall, without the consent of the Holder of each
Outstanding Note affected thereby and the Securities Insurer if affected
thereby:
(a) change the date of payment of any
installment of principal of or interest on any Note, or
reduce the principal amount thereof, the interest rate
thereon or the Redemption 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, 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);
INDENTURE (Series 199_-_) -- Page 60
(b) reduce the percentage of the Outstanding Amount of the Notes,
the consent of the Holders of which is required for any such
supplemental indenture, or the consent of the Holders of
which is required for any waiver of compliance with certain
provisions of this Indenture or certain defaults hereunder
and their consequences provided for in this Indenture;
(c) modify or alter the provisions of the proviso to the
definition of the term "Outstanding";
(d) reduce the percentage of the Outstanding Amount of the Notes
required to direct the Indenture Trustee to direct the Issuer
to sell or liquidate the Collateral pursuant to Section 5.4;
(e) ify any provision of this Section 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 Distribution
Date (including the calculation of any of the individual
components of such calculation) or to
affect the rights of the Holders of Notes 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 the Holder
of any Note 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 upon the Holders of all Notes, 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, the Indenture Trustee shall mail to the Holders of the Notes to
which such amendment or supplemental indenture relates a notice setting forth in
general terms the substance of such supplemental indenture.
INDENTURE (Series 199_-_) -- Page 61
It shall not be necessary for any Act of Noteholders under this Section to
approve the particular form of any proposed supplemental indenture, but it
shall be sufficient if such Act shall approve the substance thereof.
9.3 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
6.1 and 6.2, 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.
9.4 Effect of Supplemental Indenture. Upon the execution of
any supplemental indenture pursuant to the provisions hereof,
this Indenture shall be and shall be deemed to be modified and
amended in accordance therewith with respect to the Notes
affected thereby, and the respective rights, limitations of
rights, obligations, duties, liabilities and immunities under
this Indenture of the Indenture Trustee, the Issuer and the
Holders of the Notes shall thereafter be determined, exercised
and enforced hereunder subject in all respects to such
modifications and amendments, and all the terms and conditions
of any such supplemental indenture shall be and be deemed to
be part of the terms and conditions of this Indenture for any
and all purposes.
9.5 Conformity with Trust Indenture Act. Every amendment of
this Indenture and every supplemental indenture executed
pursuant to this Article IX shall conform to the requirements
of the Trust Indenture Act as then in effect so long as this
Indenture shall then be qualified under the Trust Indenture
Act.
9.6 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.
9.7 Amendments to Trust Agreement.
Subject to Section 11.1 of the Trust Agreement, the Indenture Trustee
shall, upon Issuer Order, consent to any proposed amendment to the Trust
Agreement or an amendment to or waiver
INDENTURE (Series 199_-_) -- Page 62
of any provision of any other document relating to the Trust Agreement, such
consent to be given without the necessity of obtaining the consent of the
Holders of any Notes upon satisfaction of the requirements under Section 11.1
of the Trust Agreement.
Nothing in this Section shall be construed to require that any Person
obtain the consent of the Indenture Trustee to any amendment or waiver or any
provision of any document where the making of such amendment or the giving of
such waiver without obtaining the consent of the Indenture Trustee is not
prohibited by this Indenture or by the terms of the document that is the
subject of the proposed amendment or waiver.
ARTICLE
REDEMPTION OF NOTES
10.1 Redemption.
The Affiliated Holder may, at its option, effect an early redemption of
the Notes on or after any Distribution Date on which the Pool Principal
Balance declines to [15%] or less of the Pool Principal Balance of the
Initial Mortgage Loans and Subsequent Mortgage Loans conveyed to the Trust as
of their respective Cut-Off Dates. The Affiliated Holder shall effect such
early redemption by directing the Indenture Trustee to sell all of the
Mortgage Loans to a person that is not an Affiliate of the Affiliated Holder,
the Seller, or the Servicer at a price not less than the Redemption Price.
In addition, the Affiliated Holder may, at its option, effect an early
redemption of the Notes on or after any Distribution Date on which the Pool
Principal Balance declines to [10%] or less of the Pool Principal Balance of
the Initial Mortgage Loans and Subsequent Mortgage Loan conveyed to the Trust
as of their respective Cut-Off Dates. In connection with any such optional
termination, to the extent that sufficient proceeds are not available from
the sale of the Mortgage Loans or the termination of the Trust, the
Affiliated Holder will pay the outstanding fees and expenses, if any, of the
Indenture Trustee, the Issuer, the Securities Insurer, and the Servicer.
In addition, subject to Section 11.19, on any date on or after which (i)
[17.5%] or more (based on Net Loan Losses) of the Mortgage Loans have become
Defaulted Mortgage Loans on a cumulative basis and (ii) the
Overcollateralization Amount has been reduced to zero or an amount less than
zero, then the Securities Insurer may, at its option, effect an early
retirement of the Securities and termination of this Agreement.
Any such redemption by the Affiliated Holder or the Securities Insurer,
as applicable, shall be accomplished by the Affiliated Holder or the
Securities Insurer, as applicable, depositing or causing to be deposited into
the Collection Account by 10:00 A.M. New York City time on the third
Business Day prior to the Redemption Date the amount of the Redemption Price.
On the same day that the Redemption Price is deposited into the Collection
Account, the Redemption Price and any amounts then on deposit in the
Collection Account (other than any amounts not required to have been
deposited therein pursuant to Section 5.01(b)(1) of the Sale and Servicing
Agreement) shall be
INDENTURE (Series 199_-_) -- Page 63
transferred to the Note Distribution Account for distribution to the
Noteholders on the Redemption Date; and any amounts received with respect to
the Mortgage Loans and Foreclosure Properties subsequent to such transfer
shall belong to the Servicer or the Securities Insurer, as applicable. For
purposes of calculating the Required Distribution Amount for the Redemption
Date, amounts transferred to the Note Distribution Account pursuant to the
immediately preceding sentence on the Determination Date immediately
preceding such final Distribution Date shall in all cases be deemed to have
been received during the related Due Period, and such transfer shall be made
pursuant to Section 5.01(c) of the Sale and Servicing Agreement.
The Servicer or the Issuer shall furnish the Rating Agencies and the
Securities Insurer notice of any such redemption in accordance with Section
10.2.
10.2 Form of Redemption Notice.
(a) Notice of redemption under Section 10.1 shall be given
by the Indenture Trustee 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 Holder of
Notes, as of the close of business on the Record Date
preceding the applicable Redemption Date, at such Holder's
address or facsimile number appearing in the Note Register.
All notices of redemption shall state:
(i) the Redemption Date;
(ii) the Redemption Price; and
(iii) the place where such Notes are to be surrendered for
payment of the Redemption Price (which shall be the office or
agency of the Issuer to be maintained as provided in Section
3.2).
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 notice of redemption, or any defect therein, to any Holder of any Note
shall not impair or affect the validity of the redemption of any other Note.
10.3 Notes Payable on Redemption Date; Provision for Payment
of Indenture Trustee and Securities Insurer. The Notes or
portions thereof to be redeemed shall, following notice of
redemption as required by Section 10.2 (in the case of
redemption pursuant to Section 10.1), on the Redemption Date
become due and payable at the Redemption Price and (unless the
Issuer shall default in the payment of the Redemption Price)
no interest shall accrue on the Redemption Price for any
period after the date to which accrued interest is calculated
for purposes of calculating the Redemption Price. The Issuer
may not redeem the Notes unless, (i) all outstanding
obligations under the
INDENTURE (Series 199_-_) -- Page 64
Notes have been paid in full and (ii) the Indenture Trustee has been paid all
amounts to which it is entitled hereunder and the Securities Insurer has been
paid all Securities Insurer Reimbursement Amounts to which it is entitled as
of the applicable Redemption Date.
ARTICLE XI
MISCELLANEOUS
11.1 Compliance Certificates and Opinions, etc.
(a) Upon any application or request by the Issuer to the
Indenture Trustee to take any action under any provision of
this Indenture, the Issuer shall furnish to the Indenture
Trustee (i) an Officer's Certificate stating that all
conditions precedent, if any, provided for in this Indenture
relating to the proposed action have been complied with, (ii)
an Opinion of Counsel stating that in the opinion of such
counsel all such conditions precedent, if any, have been
complied with and (iii) (if required by the TIA) an
Independent Certificate from a firm of certified public
accountants meeting the applicable requirements of this
Section, except that, in the case of any such application or
request as to which the furnishing of such documents is
specifically required by any provision of this Indenture, no
additional certificate or opinion need be furnished.
Every certificate or opinion with respect to compliance with a condition
or covenant provided for in this Indenture shall include:
(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
INDENTURE (Series 199_-_) -- Page 65
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.
(b) (i) Prior to the deposit of any Collateral or other
property or securities with the Indenture Trustee that is to
be made the basis for the release of any property or
securities subject to the lien of this Indenture, the Issuer
shall, in addition to any obligation imposed in Section
11.1(a) or elsewhere in this Indenture, furnish to the
Indenture Trustee an Officer's Certificate certifying or
stating the opinion of each person signing such certificate as
to the fair value (within 90 days of such deposit) to the
Issuer of the Collateral or other property or securities to be
so deposited.
(ii) Whenever the Issuer is required to furnish to the
Indenture Trustee an Officer's Certificate certifying or
stating the opinion of any signer thereof as to the matters
described in clause (i) above, the Issuer shall also deliver
to the Indenture Trustee an Independent Certificate as to the
same matters, if the fair value to the Issuer of the
securities to be so deposited and of all other such securities
made the basis of any such withdrawal or release since the
commencement of the then-current fiscal year of the Issuer, as
set forth in the certificates delivered pursuant to clause (i)
above and this clause (ii), is [10%] or more of the
Outstanding Amount of the Notes, but such a certificate need
not be furnished with respect to any securities so deposited,
if the fair value thereof to the Issuer as set forth in the
related Officer's Certificate is less than [$25,000] or less
than one percent of the Outstanding Amount of the Notes.
(iii)Whenever any property or securities are to be released
from the lien of this Indenture, the Issuer shall also furnish
to the Indenture Trustee an Officer's Certificate certifying
or stating the opinion of each person signing such certificate
as to the fair value (within 90 days of such release) of the
property or securities proposed to be released and stating
that in the opinion of such person the proposed release will
not impair the security under this Indenture in contravention
of the provisions hereof.
(iv) Whenever the Issuer is required to furnish to the
Indenture Trustee an Officer's Certificate certifying or
stating the opinion of any signer thereof as to the matters
described in clause (iii) above, the Issuer shall also furnish
to the Indenture Trustee an Independent Certificate as to the
same matters if the fair value of the property or securities
and of all other property, other than property as contemplated
by clause (v) below or securities released from the lien of
this Indenture since the commencement of the then-current
calendar year, as set forth in the certificates required by
clause (iii) above and this clause (iv), equals [10%] or more
of the Outstanding Amount of the Notes, but such
INDENTURE (Series 199_-_) -- Page 66
certificate need not be furnished in the case of any release
of property or securities if the fair value thereof as set
forth in the related Officer's Certificate is less than
[$25,000]or less than one percent of the then Outstanding
Amount of the Notes.
11.2 Form of Documents Delivered to Indenture Trustee. In any
case where several matters are required to be certified by, or
covered by an opinion of, any specified Person, it is not necessary
that all such matters be certified by, or covered by the opinion
of, only one such Person, or that they be so certified or covered
by only one document, but one such Person may certify or give an
opinion with respect to some matters and one or more other such
Persons as to other matters, and any such Person may certify or
give an opinion as to such matters in one or several documents.
Any certificate or opinion of an Authorized Officer of the Issuer may be
based, insofar as it relates to legal matters, upon a certificate or opinion
of, or representations by, counsel, unless such officer knows, or in the
exercise of reasonable care should know, that the certificate or opinion or
representations with respect to the matters upon which 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 Seller, the Issuer or the
Administrator, stating that the information with respect to such factual
matters is in the possession of the Servicer, the Seller, 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.
11.3 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
INDENTURE (Series 199_-_) -- Page 67
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 6.1) conclusive in favor of the
Indenture Trustee and the Issuer, if made in the manner
provided in this Section.
(b) The fact and date of the execution by
any person of any such instrument or writing may be
proved in any manner that the Indenture Trustee deems
sufficient.
(c) The ownership of Notes shall be proved by the Note
Register.
(d) Any request, demand, authorization,
direction, notice, consent, waiver or other action by the
Holder of any Notes shall bind the Holder of every Note
issued upon the registration thereof or in exchange
therefor or in lieu thereof, in respect of anything done,
omitted or suffered to be done by the Indenture Trustee
or the Issuer in reliance thereon, whether or not
notation of such action is made upon such Note.
11.4 Notices, etc., to Indenture Trustee, Issuer, Rating
Agencies and Securities Insurer. 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:
(a) 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 to or with the Indenture Trustee at its Corporate
Trust Office, or
(b) the Issuer by the Indenture Trustee or
by any Noteholder shall be sufficient for every purpose
hereunder if in writing and mailed first-class, postage
prepaid to the Issuer addressed to: EquiVantage Mortgage
Loan Owner Trust 199_-_, in care of ____________________,
[City], [State], Attention: ___________, or at any other
address previously furnished in writing to the Indenture
Trustee by the Issuer or the Administrator. The Issuer
shall promptly
INDENTURE (Series 199_-_) -- Page 68
transmit any notice received by it from the Noteholders
to the Indenture Trustee.
Notices required to be given to the Rating Agencies by the Issuer, the
Indenture Trustee or the Owner Trustee shall be in writing, personally
delivered or mailed by certified mail, return receipt requested, to (i) in
the case of [Moody's, at the following address: Xxxxx'x Investors Service,
Inc., Residential Mortgage Monitoring Department, 00 Xxxxxx Xxxxxx, Xxx Xxxx,
Xxx Xxxx 00000] and (ii) in the case of [Standard & Poor's, at the following
address: Standard & Poor's Ratings Group, 00 Xxxxxxxx (00xx Xxxxx), Xxx Xxxx,
Xxx Xxxx 00000, Attention of Asset Backed Surveillance Department]
; or as to each of the foregoing, at such other address as shall be
designated by written notice to the other parties.
Notices required to be given to the Securities Insurer by the Issuer, the
Indenture Trustee or the Owner Trustee shall be in writing, personally
delivered or mailed by certified mail, return receipt requested, to the
following address: _____________________, [CITY], [STATE], Attention:
_______________, or at such other address as shall be designated by written
notice to the other parties.
11.5 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 been duly 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.
Where this Indenture provides for notice to the Rating Agencies, failure
to give such notice shall not affect any other rights or obligations created
hereunder, and shall not under any circumstance constitute a Default or Event
of Default.
INDENTURE (Series 199_-_) -- Page 69
11.6 [RESERVED].
11.7 Conflict with Trust Indenture Act. If any provision
hereof limits, qualifies or conflicts with another provision hereof
that is required to be included in this Indenture by any of the
provisions of the Trust Indenture Act, such required provision
shall control.
The provisions of TIA Sections 310 through 317 that impose duties on any
person (including the provisions automatically deemed included herein unless
expressly excluded by this Indenture) are a part of and govern this
Indenture, whether or not physically contained herein.
11.8 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.
11.9 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.
11.10 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.
11.11 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, except that the Securities Insurer is an express
third party beneficiary to this Indenture as provided in Section
11.20.
11.12 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.
11.13 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, AND THE OBLIGATIONS,
RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN
ACCORDANCE WITH SUCH LAWS.
INDENTURE (Series 199_-_) -- Page 70
11.14 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.
11.15 Recording of Indenture. If this Indenture is subject to
recording in any appropriate public recording offices, such
recording is to be effected by the Issuer and at its expense
accompanied by an Opinion of Counsel (which may be counsel to the
Indenture Trustee or any other counsel reasonably acceptable to the
Indenture Trustee) to the effect that such recording is necessary
either for the protection of the Noteholders or any other Person
secured hereunder or for the enforcement of any right or remedy
granted to the Indenture Trustee under this Indenture.
11.16 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 Notes or under this
Indenture or any certificate or other writing delivered in
connection herewith or therewith, against (i) the Indenture Trustee
or the Owner Trustee in its individual capacity, (ii) any owner of
a beneficial interest in the Issuer or (iii) any partner, owner,
beneficiary, agent, officer, director, employee or agent of the
Indenture Trustee or the Owner Trustee in its individual capacity,
any holder of a beneficial interest in the Issuer, the Owner
Trustee or the Indenture Trustee or of any successor or assign of
the Indenture Trustee or the Owner Trustee in its individual
capacity, except as any such Person may have expressly agreed (it
being understood that the Indenture Trustee and the Owner Trustee
have no such obligations in their individual capacity) and except
that any such partner, owner or beneficiary shall be fully liable,
to the extent provided by applicable law, for any unpaid
consideration for stock, unpaid capital contribution or failure to
pay any installment or call owing to such entity. For all purposes
of this Indenture, in the performance of any duties or obligations
of the Issuer hereunder, the Owner Trustee shall be subject to, and
entitled to the benefits of, the terms and provisions of Article
VI, VII and VIII of the Trust Agreement.
11.17 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 Seller, the Servicer, the Affiliated Holder or the Issuer, or
join in any institution against the Seller, the Servicer, the
Affiliated Holder 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.
11.18 Inspection. The Issuer agrees that, on reasonable prior
notice, it will permit any representative of the Indenture Trustee
or the Securities Insurer, during the Issuer's normal business
hours, to examine all the books of account, records, reports and
INDENTURE (Series 199_-_) -- Page 71
other papers of the Issuer, to make copies and extracts therefrom,
to cause such books to be audited by Independent certified public
accountants, and to discuss the Issuer's affairs, finances and
accounts with the Issuer's officers, employees, and Independent
certified public accountants, all at such reasonable times and as
often as may be reasonably requested. The Indenture Trustee shall
and shall cause its representatives to hold in confidence all such
information except to the extent disclosure may be required by 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.
11.19 Grant of Noteholder Rights to Securities Insurer. In
consideration for the guarantee of the Notes by the Securities
Insurer pursuant to the Guaranty Policy, the Noteholders hereby
grant to the Securities Insurer the right to act as the holder of
[100%] of the outstanding Notes for the purpose of exercising the
rights of the Holders of the Noteshereunder, including the voting
rights of such Holders, but excluding those rights requiringthe
consent of all such Holders under Section 9.2 and any rights of
such Holders to distributions under Section 8.2 hereof; provided
that the preceding grant of rights to the Securities Insurer by the
Noteholders shall be subject to Section 11.21 hereof. The rights
of the Securities Insurer to direct certain actions and consent to
certain actions of the Noteholders hereunder will terminate at such
time as the Principal Balances of the Notes have been reduced to
zero and the Securities Insurer has been reimbursed for all
Guaranteed Payments and any other amounts owed under the Guaranty
Policy and the Insurance Agreement and the Securities Insurer hasno
further obligation under the Guaranty Policy.
11.20 Third Party Beneficiary. The parties hereto acknowledge
that the Securities Insurer is an express third party beneficiary
hereof entitled to enforce any rights reserved to it hereunder as
if it were actually a party hereto.
11.21 Suspension and Termination of Securities Insurer's Rights.
(a) During the continuation of a Securities Insurer Default,
rights granted or reserved to the Securities Insurer hereunder
shall vest instead in the Noteholders; provided that the Securities
Insurer shall be entitled to any distributions in reimbursement of
the Securities Insurer Reimbursement Amount, and the Securities
Insurer shall retain those rights under Section 9.2 hereof to
consent to any supplement to this Indenture.
(b) At such time as either (i) the Principal Balances of the
Notes have been reduced to zero or (ii) the Guaranty Policy has
been terminated following a Securities Insurer Default, and in
either case of (i) or (ii) the Securities Insurer has been
reimbursed for all Guaranteed Payments and any other amounts owed
under the Guaranty Policy and the Insurance Agreement (and the
Securities Insurer no longer has any obligation under the Guaranty
Policy, except for breach thereof by the Securities Insurer), then
the rights and benefits granted or reserved to the Securities
Insurer hereunder (including the rights to direct certain actions
and receive certain notices)shall terminate
INDENTURE (Series 199_-_) -- Page 72
and the Noteholders shall be entitled to the exercise of such
rights and to receive such benefits of the Securities Insurer
following such termination to the extent that such rights and
benefits are applicable to the Noteholders.
INDENTURE (Series 199_-_) -- Page 73
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.
EQUIVANTAGE MORTGAGE LOAN OWNER
TRUST 199_-_
By:
-----------------------------------
not in its individual capacity but
solely as Owner Trustee
By:-----------------------------------
Name:
Title:
---------------------------
as Indenture Trustee
By:
-----------------------------------
Name:
Title:
INDENTURE (Series 199_-_) -- Page 74
SCHEDULE A
(To be Provided at the Closing and Supplemented on each Subsequent Transfer
Date on which Subsequent Mortgage Loans are transferred to the Trust)
INDENTURE (Series 199_-_) -- Page 1
EXHIBIT A - Form of Note
[TO BE PROVIDED]
INDENTURE (Series 199_-_) -- Page 2
