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EXHIBIT 10.1
FAIC II ISSUER TRUST 2000-1
AMENDED AND RESTATED
AGREEMENT OF TRUST
among
FUND AMERICA INVESTORS CORPORATION II,
as Depositor
CHRISTIANA BANK & TRUST COMPANY,
as Issuer Trustee
and
STATE STREET BANK AND TRUST COMPANY,
as Issuer Certificate Agent
Dated as of January 20, 2000
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TABLE OF CONTENTS
FAIC II ISSUER TRUST 2000-1...................................................................................1
AMENDED AND RESTATED AGREEMENT OF TRUST...............................................................1
ARTICLE I: GENERAL............................................................................................1
Section 1.01. Amendment and Restatement of Prior Trust Agreement........................................1
Section 1.02. Appointment of Christiana Bank & Trust Company............................................1
Section 1.03. Governance of the Issuer..................................................................1
Section 1.04. Name, Principal Office, and Name and Address of Issuer Trustee as Agent for
Service of Process........................................................................2
Section 1.05. Purpose and Powers........................................................................2
Section 1.06. Claims Against the Issuer.................................................................3
Section 1.07. Beneficial Ownership......................................................................3
Section 1.08. Certain Covenants Relating to the Separateness of the Issuer..............................3
ARTICLE II: DEFINITIONS......................................................................................4
ARTICLE III: CONTRIBUTIONS; CONSENT TO EXECUTION OF CERTAIN AGREEMENTS........................................8
Section 3.01. Contributions on the Closing Date.........................................................8
Section 3.02. Consideration for Contribution of Contributed Assets......................................8
Section 3.03. Holding of the Issuer Estate..............................................................8
Section 3.04. Limitation on the Liability of the Issuer Trustee, the Issuer Certificate Agent,
the Depositor and Certificateholders......................................................8
Section 3.05. Direction of Issuer Trustee's Execution of and Performance Under the Deposit
Agreement and the Indenture...............................................................8
ARTICLE IV: THE CLASS R CERTIFICATES..........................................................................9
Section 4.01. Initial Ownership.........................................................................9
Section 4.02. Authorization of the Class R Certificates.................................................9
Section 4.03. Form of Class R Certificates; Denominations...............................................9
Section 4.04. Execution and Authentication of Class R Certificates......................................9
Section 4.05. Registration of Transfer and Exchange of Class R Certificates.............................9
Section 4.06. Mutilated, Destroyed, Lost or Stolen Certificates........................................11
Section 4.07. Persons Deemed Owners....................................................................12
Section 4.08. Access to List of Certificateholders' Names and Addresses................................12
Section 4.09. Maintenance of Office or Agency..........................................................12
Section 4.10. Class R Certificates Held by The Depositor...............................................12
Section 4.11. Appointment of the Certificate Paying Agent..............................................12
Section 4.12. Representations and Warranties of State Street Bank and Trust Company....................13
Section 4.13. Resignation, Removal and Replacement of the Issuer Certificate Agent.....................14
Section 4.14. Reporting................................................................................15
ARTICLE V: CERTIFICATE DISTRIBUTIONS.........................................................................15
Section 5.01. Payments From Issuer Estate..............................................................15
Section 5.02. Establishment of Trust Agreement Collection Account......................................15
Section 5.03. Certificate Distributions................................................................16
Section 5.04. Redemption of the Class R Certificates...................................................17
Section 5.05. Account Statements; Other Reports........................................................17
Section 5.06. Books and Records........................................................................19
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ARTICLE VI: CERTIFICATE TERMINATION EVENTS...................................................................19
Section 6.01. Certificate Termination Events...........................................................19
Section 6.02. Consequences of a Certificate Termination Event..........................................20
Section 6.03. Issuer Certificate Agent Termination Events..............................................20
ARTICLE VII: RIGHTS, OBLIGATIONS, POWERS AND STATUS OF THE CERTIFICATEHOLDERS..............................21
Section 7.01. Management of the Issuer.................................................................21
Section 7.02. Bankruptcy, Dissolution or Termination of any Certificateholder..........................21
Section 7.03. Creditors of the Certificateholders......................................................21
Section 7.04. Certain Rights of the Majority Certificateholders........................................21
Section 7.05. Tax Status...............................................................................21
ARTICLE VIII: CONCERNING THE ISSUER TRUSTEE AND CHRISTIANA BANK & TRUST COMPANY............................22
Section 8.01. General..................................................................................22
Section 8.02. Acceptance of the Issuer.................................................................24
Section 8.03. Authority and Duties of the Issuer Trustee...............................................25
Section 8.04. Representations and Warranties of Christiana Bank & Trust Company........................26
Section 8.05. Resignation of the Issuer Trustee........................................................26
Section 8.06. Indemnification..........................................................................27
Section 8.07. Fees and Expenses........................................................................28
Section 8.08. Litigation, Action Outside Delaware......................................................28
ARTICLE IX: REDEMPTION OF NOTES............................................................................29
Section 9.01. Optional Redemption of the Notes.........................................................29
ARTICLE X: DISSOLUTION, BANKRUPTCY AND LIQUIDATION OF THE ISSUER...........................................29
Section 10.01. Dissolution of the Issuer...............................................................29
Section 10.02. Termination.............................................................................30
ARTICLE XI: NOTICES........................................................................................30
Section 11.01. Notices.................................................................................30
ARTICLE XII: MISCELLANEOUS PROVISIONS.....................................................................32
Section 12.01. Entire Agreement........................................................................32
Section 12.02. Governing Law; Submission to Jurisdiction...............................................32
Section 12.03. Effect..................................................................................32
Section 12.04. Pronouns and Number.....................................................................32
Section 12.05. Effect of Headings......................................................................32
Section 12.06. Severability of Provisions..............................................................32
Section 12.07. Amendment or Waiver; Effect on Issuer Trust Agreement...................................33
Section 12.08. Binding Upon Assigns....................................................................33
Section 12.09. Counterparts............................................................................33
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Schedule I Agency Securities
Exhibit A Form of Class R Certificate
Exhibit B Form of Transferee Certificate
Exhibit C-1 Form of Transferee Affidavit (▇▇▇▇▇▇▇ Mac)
Exhibit C-2 Form of Transferee Affidavit (▇▇▇▇▇▇ Mae)
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FAIC II ISSUER TRUST 2000-1
AMENDED AND RESTATED AGREEMENT OF TRUST
This AMENDED AND RESTATED AGREEMENT OF TRUST (this "Agreement") of FAIC
II Issuer Trust 2000-1, a Delaware statutory business trust (the "Issuer"), is
made and entered into as of January 20, 2000 by and among Fund America Investors
Corporation II (the "Depositor"), as the initial holder of all beneficial
ownership interest in the Issuer; Christiana Bank & Trust Company, a banking
corporation incorporated in the State of Delaware (in its individual capacity
solely where expressly set forth herein, "Christiana Bank"), otherwise acting
solely in its capacity as trustee of the Issuer hereunder (in such capacity, the
"Issuer Trustee"), and State Street Bank and Trust Company, a trust company
organized in the Commonwealth of Massachusetts (in its individual capacity,
"State Street"), as authenticating agent, certificate registrar and certificate
paying agent hereunder with respect to the Class R Certificates issued hereunder
(in such capacities, the "Issuer Certificate Agent"). Capitalized terms used
without definitions have the meanings assigned to such terms in Article II or,
if not defined therein, such terms have the meanings assigned to them in the
Indenture (as defined herein).
NOW, THEREFORE, the Issuer shall be governed under the following terms
and conditions providing for the conduct of the business and affairs of the
Issuer and the maintenance of the assets contributed to or otherwise owned or
held by or on behalf of the Issuer, together with the proceeds thereof:
ARTICLE I:
GENERAL
Section 1.01. Amendment and Restatement of Prior Trust Agreement.
This Agreement hereby amends and restates in its entirety the Agreement
of Trust, dated January 19, 2000 (the "Prior Agreement of Trust") and,
notwithstanding any provision therein to the contrary, no provision of such
Prior Agreement of Trust shall survive the execution of this Agreement. The
terms of this Agreement will be effective from the date on which the Certificate
of Trust was filed.
Section 1.02. Appointment of Christiana Bank & Trust Company.
The Depositor hereby appoints Christiana Bank & Trust Company as Issuer
Trustee effective as of the date hereof, to have all the rights, powers and
duties set forth herein and in the Act. The Issuer Trustee is hereby authorized
to file a Certificate of Trust with the Secretary of State pursuant to Section
3810 of the Act.
Section 1.03. Governance of the Issuer.
The Issuer was formed as a statutory business trust under and pursuant
to the Prior Agreement of Trust, the Act and such other provisions of applicable
law as shall pertain to statutory business trusts organized pursuant to and in
accordance with the Act. It is the intention of the parties hereto that, from
and after the date hereof, this Agreement constitute the sole governing
instrument of the Issuer. All Persons owning or otherwise holding interests of
beneficial ownership in the Issuer shall own or otherwise hold such interests of
beneficial ownership pursuant to the provisions of this Agreement.
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Section 1.04. Name, Principal Office, and Name and Address of Issuer
Trustee as Agent for Service of Process.
The Issuer shall be conducted under the name "FAIC II Issuer Trust
2000-1," in which name the Issuer or the Issuer Trustee on behalf of the Issuer
shall enter into contracts and agreements with respect to the transactions
contemplated hereby. The principal place of business and office of the Issuer
shall be c/o Christiana Bank & Trust Company, Greenville Center, ▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention: Corporate Trust Administration. The
Issuer Trustee, which is hereby designated to accept service of process, is
Christiana Bank & Trust Company, and its current office is located at the
address provided in the preceding sentence.
Section 1.05. Purpose and Powers
(a) The Issuer shall have the power and authority to engage,
and the purpose of the Issuer shall be limited to engaging, in the
following activities:
(i) to enter into the Deposit and Sale Agreement
dated as of January 20, 2000 (the "Deposit Agreement") between
the Depositor and the Issuer, pursuant to which the Issuer
shall receive from the Depositor (a) the Agency Securities and
(b) the rights of the Depositor under the Purchase Agreement
dated as of January 20, 2000 (the "Purchase Agreement")
between ▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇ Incorporated, as
the Seller (in such capacity, the "Seller") and the Depositor
(together, the "Contributed Assets");
(ii) to issue U.S. $1,986,400 of the FAIC II Issuer
Trust 2000-1, variable rate, Class F Notes, due December 1,
2029 (the "Class F Notes") and U.S. $764,000 of the FAIC II
Issuer Trust 2000-1, variable rate, Class S Notes, due
December 1, 2029 (the "Class S Notes," and, together with the
Class F Notes, the "Notes") pursuant to a Terms Indenture (the
"Terms Indenture"), dated as of January 20, 2000, together
with the Standard Indenture Provisions which are incorporated
therein by reference , the "Indenture"), between the Issuer
and State Street as trustee thereunder (in such capacity, the
"Note Trustee"), and to issue U.S. $465,600 Initial
Certificate Balance of FAIC II Issuer Trust 2000-1, Class R
Certificates, due December 1, 2029 (the "Class R
Certificates"), issued hereunder, and to sell the Notes and
the Class R Certificates;
(iii) to remit the proceeds of the sale of the Notes
and the Class R Certificates to the Depositor as consideration
for the Contributed Assets received from the Depositor;
(iv) to assign, grant, transfer, pledge, mortgage and
convey the Pledged Assets (defined herein) to the Note Trustee
for the benefit of the registered holders of the Notes and to
hold, manage and distribute to the Certificateholders any
portion of the Issuer Estate released from or not included in,
the Lien on the Pledged Assets created pursuant to the
Indenture and remitted by the Note Trustee to the Trust
Agreement Collection Account pursuant to the Indenture in
accordance with this Agreement;
(v) to enter into and perform its obligations under
the Indenture and any other Transaction Document to which it
is a party;
(vi) to engage in those activities that are necessary
to accomplish the foregoing or are incidental thereto; and
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(vii) subject to compliance with the Transaction
Documents, to engage in such other activities as may be
required in connection with conservation of the Issuer Estate
and making distributions to the Certificateholders.
(b) The Issuer is hereby authorized to engage in the foregoing
activities. The Issuer shall not engage in any activity other than as
required or expressly authorized by the terms of this Agreement or the
Transaction Documents or, subject to the terms of this Agreement and
the other Transaction Documents, as the Certificateholders may from
time to time direct.
(c) References herein to Sections of the Indenture shall mean
Sections of the Terms Indenture.
Section 1.06. Claims Against the Issuer.
All Persons extending credit to, contracting with or having any claim
against the Issuer shall look only to the Issuer for payment under such credit,
contract or claim. None of the Issuer Trustee (including in its individual
capacity), the Issuer Certificate Agent (including in its individual capacity),
the Depositor, the Certificateholders or any of the Issuer's officers, employees
or agents, whether past, present or future shall be personally liable therefor.
Section 1.07. Beneficial Ownership.
The undivided beneficial ownership interest in the Issuer will be
evidenced by the Class R Certificates issued in accordance with Article IV.
Section 1.08. Certain Covenants Relating to the Separateness of the
Issuer.
The Issuer shall maintain its separate existence and, specifically,
shall conduct its affairs in accordance with the following:
(a) The Issuer shall not commingle or pool its funds or other
assets with those of any other Person.
(b) The Issuer shall maintain its assets in such a manner that
it is not costly or difficult to segregate, ascertain or otherwise
identify its individual assets from those of any other Person.
(c) The Issuer shall maintain its own records and books of
account.
(d) The Issuer shall not incur any indebtedness, except
pursuant to the Transaction Documents.
(e) The Issuer shall not lend money to any Person and will not
become obligated to provide funds for the purpose of supporting the
obligations of any Person.
(f) The Issuer shall not (i) hold itself out or permit itself
to be held out as having agreed to pay, or as being liable for,
indebtedness of another Person; (ii) fail to correct any
misrepresentation, of which the Issuer Trustee has actual knowledge,
with respect to the foregoing; or (iii) operate or purport to operate
collectively as a single or consolidated business entity with respect
to any other Person.
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(g) The Issuer shall abide by all statutory Delaware business
trust formalities, and shall cause its financial statements to be
prepared in accordance with U.S. GAAP and in a manner that indicates
the separate existence of the Issuer and the Issuer's assets and
liabilities.
(h) The issuance of the beneficial ownership interest
evidenced by the Class R Certificates to the Certificateholders is
intended to be, and shall be accounted for on the books, records, and
financial statements of the Issuer and the Certificateholders as, the
issuance of equity capital and not as a loan by the Certificateholders
to the Issuer.
(i) Other than the Accounts maintained under the Indenture and
the Trust Agreement Collection Account, any bank account of the Issuer
shall be separate from the accounts of any other Person.
(j) The Issuer shall make no transfer of its assets except in
accordance with the Transaction Documents.
(k) The Issuer shall not sponsor at any time, or agree to
sponsor, maintain, contribute to, or assume an obligation to contribute
to, any Plan.
(1) The Issuer shall not merge, consolidate or convert with or
into any other Person without the consent of all of the
Certificateholders and the Note Trustee.
ARTICLE II:
DEFINITIONS
"Account Bank" means State Street Bank and Trust Company.
"Account Statement" has the meaning set forth in Section 5.05.
"Act" means the Delaware Business Trust Act, Chapter 38 of Title 12 of
the Delaware Code, 12 Del. Code Section 3801 et seq., as in effect from time to
time.
"Agency Security" means each of the securities identified in Schedule I
hereto.
"Agreement" means this agreement of trust as it may from time to time
be amended, supplemented or otherwise modified in accordance with the terms
hereof.
"Authenticating Agent" has the meaning assigned to such term in Section
4.04.
"Available Funds" means, with respect to any Monthly Payment Date, the
aggregate amount on deposit in the Trust Agreement Collection Account on such
date.
"Bankruptcy Action" has the meaning assigned to such term in Section
10.01.
"Certificate Balance" means, with respect to each Class R Certificate,
the portion of the Outstanding Certificate Balance corresponding to such Class R
Certificate as specified on the face of such Class R Certificate on its date of
issuance.
"Certificate Placement Agreement" means the certificate placement
agreement, dated as of January 19, 2000, by and among the Issuer, the Depositor
and ▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇ Incorporated.
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"Certificateholder" or "Holder" means, with respect to any date, the
Person or Persons in whose name Class R Certificates are registered in the
Certificate Register.
"Certificate of Trust" means the Certificate of Trust of FAIC II Issuer
Trust 2000-1 filed with the Secretary of State in order to form the Issuer under
the Act, as such Certificate of Trust may be amended or restated from time to
time.
"Certificate Paying Agent" has the meaning assigned to such term in
Section 4.11.
"Certificate Register" has the meaning assigned to such term in Section
4.05(a).
"Certificate Registrar" has the meaning assigned to such term in
Section 4.05(a).
"Class R Certificates" means any of the certificates of beneficial
ownership of the Issuer issued and authenticated hereunder, substantially in the
form of Exhibit A hereto.
"Code" means the Internal Revenue Code of 1986, as amended from time to
time.
"Corporate Trust Office" means the principal corporate trust office of
the Issuer Certificate Agent, with current addresses at State Street Bank and
Trust Company, Global Investor Services Group - Corporate Trust, ▇ ▇▇▇▇▇▇ ▇▇
▇▇▇▇▇▇▇▇▇ - ▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ and State Street Bank and
Trust Company, Global Investor Services Group - Corporate Trust, P. O. ▇▇▇ ▇▇▇,
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇-▇▇▇▇, or such other address within the United
States as the Issuer Certificate Agent may designate from time to time by notice
to the Issuer, or the principal corporate trust office of any successor Issuer
Certificate Agent.
"Cut-off Date" means January 26, 2000.
"Disqualified Organization" means the United States of America, any
state or political subdivision thereof, any foreign government, any
international organization, any agency or instrumentality of any of the
foregoing, any organization exempt from taxation under the Code (other than a
cooperative described in Code Section 521) unless such organization is subject
to the tax imposed by Code Section 511, and any organization described in Code
Section 1381 (a)(2)(C).
"ERISA" has the meaning assigned to such term in Section 4.05(g).
"Event of Default" has the meaning assigned to such term in the
Indenture.
"Expense Reserve Account" has the meaning assigned to such term in
Section 7.01 of the Indenture.
"Final Scheduled Monthly Payment Date" has the meaning assigned to such
term in Section 5.04(a).
"Initial Certificate Balance" means, with respect to the Class R
Certificates, U.S. $465,600.
"Institutional Accredited Investor" means an "accredited investor" as
defined in subsections (1), (2), (3) and (7) under Rule 501(a) promulgated under
the Securities Act.
"Issuer Assets" means (i) the Agency Securities; (ii) the amounts in
the Note Collection Account, the Interest Reserve Account, the Expense Reserve
Account and the Trust Agreement Collection Account,
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including any Eligible Investments purchased with funds held in the Note
Collection Account, the Expense Reserve Account and the Interest Reserve
Account; (iii) the rights of the Issuer under the Deposit Agreement and this
Agreement; and (iv) all proceeds of the foregoing.
"Issuer Certificate Agent" means State Street Bank and Trust Company,
in its capacity as Certificate Paying Agent, and in its capacity as Certificate
Registrar and Authenticating Agent or any successor thereto in such capacity as
appointed pursuant to Section 4.13.
"Issuer Estate" means all right, title and interest of the Issuer in
and to the Issuer Assets, any Transaction Document to which the Issuer is a
party and any other property contributed to the Issuer or otherwise acquired by
the Issuer, together with all distributions, payments, revenues, issues, profits
or proceeds thereof and therefrom, and all appurtenances thereto.
"Issuer Trustee" means Christiana Bank & Trust Company, not in its
individual capacity but solely as Issuer Trustee hereunder, and any successor
Issuer Trustee appointed in accordance with Section 3807 of the Act and Section
8.05.
"Majority Certificateholders" means, at any time, Certificateholders
holding, collectively, Class R Certificates representing more than 50% of the
Outstanding Certificate Balance.
"Monthly Payment Date" means the first Business Day of each month
commencing on March 1, 2000.
"Optional Certificate Redemption Amount" has the meaning assigned to
such term in Section 5.04(b).
"Outstanding Certificate Balance" means, with respect to the Class R
Certificates, on any date, an amount equal to (i) the Initial Certificate
Balance thereof minus (ii) the aggregate amount of all distributions of
principal made to the Certificateholders. The Outstanding Certificate Balance
shall be calculated as of the close of business, in the case of any Monthly
Payment Date other than the initial Monthly Payment Date, on the immediately
preceding Monthly Payment Date after giving effect to all distributions of
principal to the applicable Holders on each preceding Monthly Payment Date
(including such immediately preceding Monthly Payment Date); provided that, on
the Closing Date, the Outstanding Certificate Balance thereof shall be equal to
the Initial Certificate Balance.
"Permitted Certificate Redemption Date" has the meaning assigned to
such term in Section 5.04(b).
"Plan" has the meaning assigned to such term in Section 4.05(g).
"Pledged Assets" means all of the Issuer Assets (except for (i) amounts
in the Trust Agreement Collection Account and the Expense Reserve Account
(including any Eligible Investments purchased with funds held in the Expense
Reserve Account) and (ii) until the Outstanding Certificate Balance of the Class
R Certificates has been reduced to zero, principal payments on the Series 2203
▇▇▇▇▇▇▇ Mac Security).
"Prior Agreement of Trust" has the meaning assigned to such term in
Section 1.01.
"Record Date" means, with respect to any Monthly Payment Date, the
close of business on the last Business Day of the calendar month immediately
preceding the calendar month in which such Monthly Payment Date falls.
"Residual Collections" has the meaning assigned to such term in Section
5.03(a).
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"Secretary of State" means the office of the Secretary of State of the
State of Delaware.
"Securities Act" means the Securities Act of 1933, as amended, and any
rules and regulations promulgated thereunder.
"Seller" means the party identified as such in Section 1.05(a)(i).
"Series 2203 ▇▇▇▇▇▇▇ Mac Security" has the meaning specified in the
Indenture.
"Tax Matters Partner" has the meaning assigned to such term in Section
7.05.
"Transferee Affidavit" has the meaning assigned to such term in Section
4.05(h).
"Transferee Certificate" has the meaning assigned to such term in
Section 4.05(b).
"Trust Agreement Collection Account" has the meaning assigned to such
term in Section 5.02.
"Transaction Documents" means this Agreement, the Class R Certificates,
the Indenture, the Notes, the Purchase Agreement, the Underwriting Agreement,
the Certificate Placement Agreement and the Deposit Agreement.
"Treasury Regulations" means the current, temporary, and proposed
income tax regulations under the Code.
"Underwriting Agreement" means the underwriting agreement, dated as of
January 19, 2000, by and among the Issuer, the Depositor and ▇▇▇▇▇▇▇ Lynch,
Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇ Incorporated, as underwriter.
"U.S. Person" means (i) a citizen or resident of the United States,
(ii) a corporation, partnership or other entity created or organized in or under
the laws of the United States or any state (other than a partnership that is not
treated as a U.S. person under any applicable Treasury Regulations), (iii) an
estate whose income is subject to United States federal income tax regardless of
its source, or (iv) a trust if a court within the United States is able to
exercise primary supervision over the administration of the trust and one or
more U.S. persons have the authority to control all substantial decisions of the
trust. Notwithstanding the preceding sentence, to the extent provided in
Treasury Regulations, certain trusts in existence on August 20, 1996 and treated
as U.S. Persons prior to such date, that elect to continue to be treated as U.S.
Persons, will be so treated.
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ARTICLE III:
CONTRIBUTIONS; CONSENT TO EXECUTION OF CERTAIN AGREEMENTS
Section 3.01. Contributions on the Closing Date.
The Depositor hereby agrees to transfer the Contributed Assets,
pursuant to the terms of the Deposit Agreement, on the Closing Date, as a
capital contribution to the Issuer.
Section 3.02. Consideration for Contribution of Contributed Assets.
Proceeds received by the Issuer from the sale of the Class R
Certificates and from the sale of the Notes shall be paid by the Issuer to the
Depositor as consideration for the transfer by the Depositor of the Contributed
Assets to the Issuer.
Section 3.03. Holding of the Issuer Estate.
In order to establish the Issuer created hereby to be known as "FAIC II
Issuer Trust 2000-1," the Depositor appointed the Issuer Trustee to act as
Issuer Trustee hereunder, and the Issuer Trustee hereby declares and agrees that
it will hold all estate, right, title and interest in and to the Issuer Estate
until this Agreement terminates pursuant to the terms of this Agreement, in
trust under and subject to the conditions and agreements hereinafter set forth,
for the use and benefit of the Certificateholders from time to time (subject to
the pledge of the Pledged Assets to the Note Trustee for the benefit of the
Noteholders from time to time).
Section 3.04. Limitation on the Liability of the Issuer Trustee, the
Issuer Certificate Agent, the Depositor and Certificateholders.
None of the Depositor, the Issuer Trustee, the Issuer Certificate Agent
or any Certificateholder shall be liable for any debt, claim, demand, judgment
or obligation of any kind of, against or with respect to the Issuer by reason of
its being the Issuer Trustee, the Issuer Certificate Agent, the Depositor or a
Certificateholder, as the case may be. The Issuer Trustee, the Issuer
Certificate Agent, the Depositor or any Certificateholder, solely by reason of
its status as such, shall not be subject to any personal liability whatsoever,
in tort, contract or otherwise, to any Person in connection with the property,
liabilities or affairs of the Issuer, except as expressly provided herein or in
the other Transaction Documents.
Section 3.05. Direction of Issuer Trustee's Execution of and
Performance Under the Deposit Agreement and the Indenture.
By its execution hereof, the Depositor hereby directs the Issuer
Trustee to execute this Agreement and perform the Issuer Trustee's obligations
under this Agreement as well as to execute on behalf of the Issuer, and to
perform the Issuer Trustee's obligations under, the Deposit Agreement and the
Indenture.
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ARTICLE IV:
THE CLASS R CERTIFICATES
Section 4.01. Initial Ownership.
Upon the formation of the Issuer by the Depositor and until the
issuance of the Class R Certificates, the Depositor shall be the sole
beneficiary of the Issuer.
Section 4.02. Authorization of the Class R Certificates.
The Class R Certificates represent undivided, beneficial ownership
interests in the Issuer Estate. All outstanding Class R Certificates shall share
pari passu in the Issuer Estate and any distributions distributable to the
Certificateholders therefrom, subject to the Lien of the Indenture on the
Pledged Assets. The Depositor or its assignee, however, will retain the right to
cause the redemption of the Class R Certificates pursuant to Section 5.04. The
Outstanding Certificate Balance of all Class R Certificates on the Closing Date
to be executed and delivered by the Authenticating Agent under this Agreement
shall be equal to the Initial Certificate Balance, except for Class R
Certificates executed and delivered upon registration or transfer of, or in
exchange for, or in lieu of, other Class R Certificates pursuant to Sections
4.05 or Section 4.06.
Section 4.03. Form of Class R Certificates; Denominations.
The Class R Certificates issued hereunder shall be issued in definitive
fully registered form, without interest coupons, in substantially the form
attached as Exhibit A hereto, with such applicable legends as are provided for
in Exhibit A hereto. The Class R Certificates shall be issued in minimum
denominations of $200,000.
Section 4.04. Execution and Authentication of Class R Certificates.
The Issuer is hereby authorized to issue the Class R Certificates.
State Street Bank and Trust Company is hereby initially appointed
"Authenticating Agent" for the purpose of authenticating and delivering the
Class R Certificates. The Authenticating Agent is hereby authorized and
directed, subject to the terms and conditions hereof, to authenticate and
deliver the Class R Certificates on the Closing Date, subject to the terms of
the Transaction Documents. The Class R Certificates shall be executed on behalf
of the Issuer by manual or facsimile signature of any authorized signatory of
the Issuer Trustee having such authority. Class R Certificates bearing the
manual or facsimile signatures of individuals who were, at the time when such
signatures were affixed, authorized to sign on behalf of the Issuer Trustee
shall be validly issued and entitled to the benefits of this Agreement,
notwithstanding that such individuals or any of them have ceased to be so
authorized prior to the authentication and delivery of such Class R
Certificates. No Class R Certificates shall be valid for any purpose unless duly
authenticated by manual signature of an authorized officer of the Authenticating
Agent. On the Closing Date, the Authenticating Agent shall cause Class R
Certificates in authorized denominations in an aggregate face amount equal to
the Initial Certificate Balance to be authenticated and delivered to or upon the
order of the Depositor. All Class R Certificates shall be dated the date of
their authentication.
Section 4.05. Registration of Transfer and Exchange of Class R
Certificates.
(a) State Street Bank and Trust Company is hereby initially
appointed "Certificate Registrar" for the purpose of registering Class
R Certificates and transfers and exchanges of Class R Certificates as
provided in this Agreement. The Certificate Registrar shall maintain,
or cause to
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be maintained, at the Corporate Trust Office of the Certificate
Registrar, a certificate register (the "Certificate Register") in
which, subject to such reasonable regulations as it may prescribe, the
Certificate Register shall provide for the registration of Class R
Certificates and of transfers and exchanges of Class R Certificates as
provided in this Agreement.
(b) Every Class R Certificate presented or surrendered for
registration of transfer or exchange shall be accompanied by a written
instrument of transfer in form satisfactory to the Certificate
Registrar duly executed by the Certificateholder or his attorney duly
authorized in writing. Each Class R Certificate surrendered for
registration of transfer or exchange shall be canceled and subsequently
disposed of by the Certificate Registrar in accordance with its
customary practice. At the direction of the Certificate Registrar, the
Issuer Trustee shall execute, in the case of a transfer, in the name of
the transferee or transferees, and the Authenticating Agent shall
authenticate and deliver, a new Class R Certificate or Class R
Certificates for the same aggregate Certificate Balance; provided that,
if such a transfer is to be made without registration under the
Securities Act and applicable state securities laws, the Certificate
Registrar shall not register such transfer unless and until the
prospective transferee provides the Certificate Registrar and the
Issuer Trustee with a Transferee Certificate substantially in the form
of Exhibit B hereto (each, a "Transferee Certificate").
(c) At the option of a Holder, the Class R Certificates may be
exchanged for other Class R Certificates in authorized denominations of
a like Certificate Balance upon surrender of the Class R Certificates
to be exchanged at the office or agency maintained pursuant to Section
4.09.
(d) No service charge shall be made for any registration of
transfer or exchange of Class R Certificates, but the Certificate
Registrar may require payment of a sum sufficient to cover any tax or
governmental charge that may be imposed in connection with any transfer
or exchange of Class R Certificates.
(e) Each Class R Certificate shall be subject to the
restrictions on transfer provided in the applicable legends required to
be set forth in the face of each Class R Certificate pursuant to
Exhibit A hereto.
(f) The Certificate Registrar also may require, in certain
circumstances, a certification from the Certificateholder desiring to
effect the transfer and such Certificateholder's prospective transferee
concerning the factual basis for the registration or qualification
exemption relied upon, and an Opinion of Counsel acceptable in form and
substance to the Certificate Registrar, to the effect that such
transfer may be made pursuant to an exemption, describing the
applicable exemption and the basis therefor, from the Securities Act
and said state laws and is being made in accordance with the Investment
Company Act of 1940, as amended (the "Investment Company Act"), which
Opinion of Counsel shall not be an expense of the Certificate
Registrar, the Issuer Trustee or the Issuer. Each Certificateholder
will be deemed by its acceptance and holding of its Class R Certificate
to agree that neither the Issuer nor the Certificate Registrar is under
an obligation to or intends to register the Class R Certificates under
the Securities Act or any other securities law.
(g) No transfer of a Class R Certificate shall be made unless
and until the prospective transferee provides the Certificate Registrar
with an affidavit, in the form of paragraph 7 of Exhibit B hereto, that
the prospective transferee is not an employee benefit plan that is
subject to all or a portion of Title I of the Employee Retirement
Income Security Act of 1974, as amended ("ERISA"), or any retirement
plan or arrangement that is subject to Section 4975 of the Code, nor
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a person acting, directly or indirectly, on behalf of any such employee
benefit plan, plan or arrangement (including an insurance company using
funds in its general account that may constitute "plan assets") (each,
a "Plan") and is not a governmental plan subject to any laws or
regulations that are substantially similar to Section 406 of ERISA or
Section 4975 of the Code, or a person acting, directly or indirectly,
on behalf of any such government plan.
(h) A beneficial or record interest in a Class R Certificate
may not be sold or transferred to a Disqualified Organization. Any
attempted or purported transfer of an interest in a Class R Certificate
shall be absolutely null and void and shall vest no rights in the
purported transferee unless such transferee provides to the Certificate
Registrar, who shall be responsible for forwarding it to ▇▇▇▇▇▇ ▇▇▇ or
▇▇▇▇▇▇▇ Mac, as appropriate, (i) affidavits, in the forms provided as,
respectively, Exhibits C-1 and C-2 hereto (the "Transferee
Affidavits"), each to the effect that such prospective transferee is
(A) not a Disqualified Organization and is not purchasing such Class R
Certificate on behalf of a Disqualified Organization and (B) a U.S.
Person and (ii) if requested by the Certificate Registrar, an opinion
of counsel (in a form acceptable to the Certificate Registrar) that the
proposed transfer will not cause such interest to be held by or on
behalf of a Disqualified Organization. Such transferee shall also
provide a cover letter addressed to the Issuer Trustee, the
Authenticating Agent and the Certificate Registrar to the effect that
the addressees of such letter may rely on the certifications made by
such transferee in the Transferee Affidavits. In the event that the
Class R Certificates shall be optionally redeemed, the Seller, as the
assignee of the Depositor's right to cause the redemption of the Class
R Certificates and, after the redemption, the owner of 100% of the
beneficial ownership interest in the Issuer, shall be obligated to
provide the Transferee Affidavits, a Transferee Certificate and, if
requested by the Certificate Registrar, an opinion of counsel as
described in this paragraph, as if the Seller were the prospective
transferee for the purposes of this paragraph, to the Certificate
Registrar. The Certificate Registrar shall be responsible for
forwarding such documents to ▇▇▇▇▇▇ ▇▇▇ or ▇▇▇▇▇▇▇ Mac, as appropriate.
(i) Notwithstanding anything contained herein to the contrary,
neither the Issuer Trustee nor the Certificate Registrar shall be
responsible for ascertaining whether any transfer complies with the
registration provisions or exemptions from the Securities Act, the
Exchange Act, applicable state securities law or the Investment Company
Act; provided, however, that if a certificate is specifically required
to be delivered to the Certificate Registrar by a purchaser or a
transferee of a Class R Certificate, the Certificate Registrar shall be
obligated to examine such certificate to determine whether it conforms
to the requirements of this Agreement.
Section 4.06. Mutilated, Destroyed, Lost or Stolen Certificates.
In case any Class R Certificate becomes mutilated or defaced or lost,
destroyed or stolen, then on the terms herein set forth, and not otherwise, the
Issuer Trustee, at the direction of the Authenticating Agent, shall execute and
the Authenticating Agent on behalf of the Issuer shall authenticate and deliver
to the registered Holder a new Class R Certificate of like tenor and date, and
bearing such identifying number or designation as the Authenticating Agent may
determine, in exchange and substitution for, and upon cancellation of, the
mutilated or defaced Class R Certificate, or in lieu of and in substitution for
the same if lost, destroyed or stolen. The applicant for a new Class R
Certificate pursuant to this Section 4.06 shall, in the case of any mutilated or
defaced Class R Certificate, surrender such certificate to the Authenticating
Agent and furnish to the Authenticating Agent, in the case of any lost,
destroyed or stolen Class R Certificate, evidence satisfactory to the
Authenticating Agent of such loss, destruction or theft and, in each case,
evidence satisfactory to the Authenticating Agent of the ownership and
authenticity of such Class R Certificate and shall pay all expenses and charges
of such substitution and furnish such security or indemnity as may be reasonably
required by the Issuer Trustee and the Authenticating Agent to indemnify
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and defend and save the Authenticating Agent and the Issuer Trustee harmless
(provided, that the unsecured agreement of indemnity of any Certificateholder
who is an Institutional Accredited Investor shall be deemed satisfactory, it
being understood, that the Authenticating Agent may reasonably request
information necessary to establish that any such holder is an Institutional
Accredited Investor). Any defaced or mutilated Class R Certificate shall be
destroyed by the Authenticating Agent, or retained in accordance with its
standard retention policy, upon delivery by it of a new Class R Certificate to
the Holder.
Section 4.07. Persons Deemed Owners.
Prior to due presentation of a Class R Certificate for registration of
transfer, the Issuer, and any agent of the Issuer may treat the Person in whose
name any Class R Certificate is registered as the owner of such Class R
Certificate for the purpose of receiving distributions pursuant to Section 5.03
and for all other purposes whatsoever, and neither the Issuer nor any agent of
the Issuer shall be affected by any notice to the contrary.
Section 4.08. Access to List of Certificateholders' Names and
Addresses.
The Certificate Registrar shall furnish or cause to be furnished to
each Certificateholder, within 15 days after receipt by the Certificate
Registrar of a written request therefor from such party, a list, in such form as
such party may reasonably require, of the names and addresses of the
Certificateholders as of the most recent Record Date for payment of
distributions to Certificateholders. Every Certificateholder, by receiving and
holding a Class R Certificate, agrees that neither the Certificate Registrar nor
any agent thereof, shall be held accountable by reason of the disclosure of any
such information as to the names and addresses of the Certificateholders under
this Agreement, regardless of the source from which such information was
derived.
Section 4.09. Maintenance of Office or Agency.
The Issuer Certificate Agent shall maintain in New York City or Boston,
Massachusetts, an office or offices or agency or agencies where Class R
Certificates may be surrendered for registration of transfer or exchange and
where notices and demands to or upon the Issuer in respect of the Class R
Certificates and the Transaction Documents may be served. The Issuer Certificate
Agent initially designates its office at Lafayette Corporate Center, ▇ ▇▇▇▇▇▇ ▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇. Alternatively, the Issuer Certificate
Agent may maintain an office at ▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ as the
office or agency for such purposes. The Issuer Certificate Agent shall give
prompt written notice to the Certificateholders of any change in the location of
the Certificate Register or any such office of agency.
Section 4.10. Class R Certificates Held by The Depositor.
For the purposes of determining whether the Certificateholders of the
requisite percentage of the Outstanding Certificate Balance have taken any
action authorized by this Agreement or the Indenture with respect to the giving
of direction, instruction, consents or approvals or with respect to any other
matter, any Class R Certificates known by the Certificate Registrar to be
directly or indirectly owned by the Depositor or any of its Affiliates shall be
disregarded and deemed not to be outstanding, unless the Depositor is the sole
Certificateholder.
Section 4.11. Appointment of the Certificate Paying Agent
(a) State Street Bank and Trust Company is initially appointed
as paying agent for the Certificates (in such capacity, the
"Certificate Paying Agent"). The Certificate Paying Agent shall
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make distributions to the Certificateholders in accordance with Article
V. The Certificateholders shall cause any successor Certificate Paying
Agent or any additional Certificate Paying Agent appointed by the
Certificateholders to execute and deliver to the Issuer an instrument
in which the successor Certificate Paying Agent or additional
Certificate Paying Agent shall agree with the Issuer that, as
Certificate Paying Agent, the successor Certificate Paying Agent or
additional Certificate Paying Agent will hold any sums held by it for
payment to the Certificateholders in trust for the benefit of the
Certificateholders entitled to them until those sums shall be paid to
the appropriate Certificateholders. Subject to applicable law, the
Certificate Paying Agent shall return to the Issuer all funds held for
any Class R Certificate that remain unclaimed for a period of three
years after such funds were set aside to be distributed to such
Certificateholder, and upon removal of a Certificate Paying Agent, such
Certificate Paying Agent shall also return all funds in its possession
to the Issuer. Any reference in this Agreement to the Certificate
Paying Agent shall include any co-Certificate Paying Agent unless the
context requires otherwise.
(b) As set forth herein, the Person who serves as the
Certificate Paying Agent shall also serve as the Authenticating Agent
and the Certificate Registrar with respect to the Class R Certificates.
(c) State Street Bank and Trust Company, as Issuer Certificate
Agent, Certificate Paying Agent, Authenticating Agent and Certificate
Registrar hereunder (and any successor thereto) (i) shall receive as
compensation for its services hereunder the fees specified in Section
6.02 of the Indenture, subject to the limitations set forth therein
(provided that the Issuer Certificate Agent will be separately
compensated by the Seller for its services under Section 4.14 subject
to a cap of $8,000.00) and (ii) shall have the same rights, protection,
immunities and indemnifications as are available to the Issuer Trustee
pursuant to Sections 8.06, 8.07 and 8.08 of this Agreement and to the
Note Trustee under Section 10.01(d) and (e), 10.02, 10.05 and 10.07 of
the Indenture.
Section 4.12. Representations and Warranties of State Street Bank and
Trust Company.
State Street Bank and Trust Company, in its individual capacity, hereby
represents and warrants to the Depositor and the Holders from time to time of
the Class R Certificates that:
(a) Corporate Existence and Power. State Street is a trust
company duly organized, validly existing and in good standing under the
laws of the Commonwealth of Massachusetts and has all corporate powers
and all governmental licenses, authorizations, consents and approvals
required to carry on its business as now conducted and as contemplated
by this Agreement.
(b) Corporate and Governmental Authorization; No
Contravention. The execution, delivery and performance by State Street
of this Agreement are within State Street's corporate powers, have been
duly authorized by all necessary corporate action, require no action by
or in respect of, or filing with, any governmental body, agency or
official and do not contravene, or constitute a default under, any
provision of applicable law or regulation of the Commonwealth of
Massachusetts, or of the Certificate of Incorporation or the Bylaws of
State Street or of any agreement or other instrument binding upon State
Street or result in the creation or imposition of any Lien on any asset
of State Street.
(c) Binding Obligation. This Agreement has been duly
authorized, and when executed and delivered by State Street, assuming
the due authorization and delivery by each party thereto, shall
constitute the legal, valid, enforceable and binding obligation of
State Street, enforceable against it in accordance with its respective
terms, except as subject to applicable bankruptcy, insolvency,
reorganization, moratorium or other similar laws now or hereafter in
effect, affecting
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the enforcement of creditors' rights in general and except as such
enforceability may be limited by general principles of equity (whether
considered in a proceeding at law or in equity).
(d) No Conflict. Neither the execution, delivery and
performance of this Agreement, nor the consummation of the transactions
contemplated by this Agreement, (i) is prohibited by, or requires State
Street to obtain any consent, authorization, approval or registration
under, any law, statute, rule, regulation, judgment, order, writ,
injunction or decree that is binding upon State Street or any of its
properties or assets, or (ii) will violate any provision of, result in
any default or acceleration of any obligations under, result in the
creation or imposition of any lien pursuant to, or require any consent
under, any agreement to which State Street is a party or by which it or
any of its property is bound.
(e) No Proceedings. There are no proceedings pending, or to
the best knowledge of State Street, threatened against State Street
before any Federal, provincial or other governmental agency, authority,
administrator or regulatory body, arbitrator, court or other tribunal
foreign or domestic, that could have a material adverse effect on the
Issuer Assets or any action taken or to be taken by State Street under
this Agreement.
Section 4.13. Resignation, Removal and Replacement of the Issuer
Certificate Agent.
(a) The Majority Certificateholders may remove the Issuer
Certificate Agent if such Certificateholders determine in their sole
discretion that the Issuer Certificate Agent has failed to perform its
obligations under this Agreement in any material respect. The Issuer
Certificate Agent may not resign and be discharged of the trust created
by this Agreement unless (i) the Issuer Certificate Agent shall provide
30 days' written notice to the Issuer Trustee and the
Certificateholders, (ii) the Issuer Certificate Agent shall locate a
successor Issuer Certificate Agent satisfying the eligibility
requirements for such successor Issuer Certificate Agent set forth in
this Section 4.13, (iii) the Issuer Certificate Agent shall have agreed
with such successor Issuer Certificate Agent as to fees and expenses to
be paid to such successor Issuer Certificate Agent for serving as
Issuer Certificate Agent with respect to the Class R Certificates so
long as any Class R Certificates are Outstanding and, if such
agreed-upon fees and expenses to be paid to the successor Issuer
Certificate Agent exceed the amounts remaining in the Expense Reserve
Account allocated to the Issuer Certificate Agent, the Issuer
Certificate Agent shall make provisions for such shortfall in a manner
satisfactory to such successor Issuer Certificate Agent and (iv) such
successor Issuer Certificate Agent shall agree to be assigned all of
the rights and powers, and to assume all of duties and obligations, of
the Issuer Certificate Agent set forth in this Agreement and the other
Transaction Documents. Any such removal or resignation shall take
effect upon receipt by the predecessor Issuer Certificate Agent of an
instrument of acceptance of appointment executed by a successor Issuer
Certificate Agent as herein provided; provided that such Person shall
be a bank or trust company incorporated and doing business within the
United States of America, whose business shall include the providing of
paying agent, registrar, and transfer agent services in asset
securitization transactions and who will have a combined capital and
surplus of at least $100,000,000, if there be such an institution
willing, able and legally qualified to perform the duties of the Issuer
Certificate Agent hereunder upon reasonable or customary terms. The
appointment of the successor Issuer Certificate Agent shall take effect
concurrently with (i) the removal or resignation of the former Issuer
Certificate Agent and (ii) the ratification of the Transaction
Documents by the successor Issuer Certificate Agent, and no removal or
resignation of an Issuer Certificate Agent shall be effective absent
the concurrent appointment of a successor Issuer Certificate Agent.
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(b) If a successor Issuer Certificate Agent shall not have
been appointed within 60 days after such notice of resignation, the
Issuer Certificate Agent or the Majority Certificateholders may apply
to any court of competent jurisdiction to appoint a successor Issuer
Certificate Agent to act until such time as a successor shall have been
appointed as above provided.
(c) Any corporation into which the Issuer Certificate Agent
may be merged or converted or with which it may be consolidated, or any
corporation resulting from any merger, conversion or consolidation to
which the Issuer Certificate Agent shall be a party, or any corporation
to which substantially all the corporate trust business of the Issuer
Certificate Agent may be transferred, shall, subject to such
corporation satisfying in all respects the requirements set forth in
Section 8.05(a), be the Issuer Certificate Agent hereunder without
further action.
Section 4.14. Reporting.
The Issuer Certificate Agent, on behalf of the Issuer, will file all
reports as required by the Securities and Exchange Commission ("SEC") pursuant
to Section 13 or 15(d) of the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), and Section 314(a) of the Trust Indenture Act of 1939, as
amended. Within 15 days of filing any such report, the Issuer Certificate Agent
will deliver a copy of the filed report to the Note Trustee. The Issuer
Certificate Agent's responsibilities hereunder shall be to file monthly reports
on Form 8-K attaching a copy of the current Account Statement and an Annual
Report on Form 10-K after the end of each fiscal year of the Issuer, within the
time frames required under the Exchange Act and the rules and regulations
promulgated thereunder. The Issuer Certificate Agent is hereby authorized and
directed to cause the suspension of the periodic reporting requirements with
respect to the Issuer and the Notes pursuant to Section 15(d) of the Exchange
Act, by filing a Form 15 with the SEC and taking all other action to cause such
suspension, as soon as the Notes are eligible to have such periodic reporting
requirements suspended pursuant to Section 15(d) of the Exchange Act.
ARTICLE V:
CERTIFICATE DISTRIBUTIONS
Section 5.01. Payments From Issuer Estate.
All payments to be made by the Issuer Certificate Agent on behalf of
the Issuer under this Agreement or any of the documents to which the Issuer is a
party shall be made only from the income and proceeds of the Issuer Estate and
only to the extent that the Issuer shall have received income or proceeds from
the Issuer Estate to make such payments in accordance with the terms hereof and
the Indenture.
Section 5.02. Establishment of Trust Agreement Collection Account
(a) The Issuer Certificate Agent will establish and maintain a special
purpose, non-interest bearing trust account at the Account Bank for the benefit
of the Certificateholders, subject to Section 5.03(a) (the "Trust Agreement
Collection Account"). The Trust Agreement Collection Account shall be under the
sole dominion and control of the Issuer Certificate Agent on behalf of the
Certificateholders, subject to Section 5.03(a). Only the Issuer Certificate
Agent shall be entitled to withdraw funds from the Trust Agreement Collection
Account and only the Issuer Certificate Agent shall be an authorized signatory
on the Trust Agreement Collection Account. The Issuer Certificate Agent shall
withdraw funds from the Trust Agreement Collection Account only pursuant to and
in accordance with this Agreement.
(b) All Available Funds on deposit from time to time in the Trust
Agreement Collection Account and in all proceeds thereof (including all income
thereon) shall constitute part of the Issuer Estate.
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Section 5.03. Certificate Distributions.
Subject to the provisions of Sections 5.04 and 6.02, the Issuer
Certificate Agent shall distribute all Available Funds pursuant to and in
accordance with this Section 5.03.
(a) Payments to Issuer Trustee and Note Trustee. In the event
the Issuer Trustee, the Issuer Certificate Agent, or the Note Trustee
has a valid claim for reimbursement of expenses or indemnification
pursuant to Sections 4.11(c), 8.06 or 8.07 of this Agreement or Section
10.07 of the Indenture, as applicable, all amounts in the Trust
Agreement Collection Account (other than amounts representing
collections of principal payments on the Series 2203 ▇▇▇▇▇▇▇ Mac
Security) ("Residual Collections") shall be allocated and distributed,
pari passu to the Issuer Trustee, the Issuer Certificate Agent and the
Note Trustee to the extent of their respective claims for such expense
reimbursement or indemnification.
(b) Distribution of Principal. On any Monthly Payment Date,
until the Outstanding Certificate Balance of the Class R Certificates
has been reduced to zero, all amounts in the Trust Agreement Collection
Account representing collections of principal payments on the Series
2203 ▇▇▇▇▇▇▇ Mac Security after the Cut-off Date and, following any
payment made pursuant to Section 5.03(a), any other amounts in the
Trust Agreement Collection Account shall be allocated and distributed
to the Certificateholders pro rata in reduction of the Outstanding
Certificate Balance of the Class R Certificates.
(c) Distributions of Investment Yield. The Class R
Certificates have no stated interest rate. After the Issuer has paid
all principal of and interest on the Notes in full and after the
Outstanding Certificate Balance of the Class R Certificates has been
reduced to zero by application of distributions on Monthly Payment
Dates as provided in Section 5.03(b) above, any remaining amounts
remitted to the Trust Agreement Collection Account and held therein on
a Monthly Payment Date shall be allocated and distributed to the
Certificateholders pro rata on such Monthly Payment Date as additional
investment yield.
(d) Excess Payments. Each Certificateholder shall be deemed to
agree, by its acceptance of a Class R Certificate, that it shall
promptly remit to the Issuer Certificate Agent for payment in
accordance with this Section 5.03 any excess payment it has received.
(e) All payments made to the Certificateholders on any Monthly
Payment Date shall be made to the Certificateholders of record as of
the Record Date.
(f) The Certificateholders shall be entitled to receive
distributions hereunder on any Monthly Payment Date by wire transfer to
the account specified in writing by the applicable Certificateholder to
the Issuer Certificate Agent. In each case, the account must be
specified in writing no later than the Record Date for the applicable
Monthly Payment Date on which wire transfers will commence.
(g) It is the parties' intent that the Class R Certificates be
a "fixed income security" as defined in clause (b)(2) of Rule 3a-7
promulgated under the Investment Company Act of 1940, as amended.
Substantially all of the payments to which the Class R Certificates are
entitled consist of the sum of (1) its stated principal amount of
$465,600, (2) an amount equal to the portion of the interest received
on the Agency Securities that is used to make payments of principal on
the Notes, less an amount equal to the principal balance of the Class R
Certificates at the time at which the Notes are paid in full, and (3)
100% of the interest accrued on the Agency Securities at any time after
the Notes are paid in full.
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Section 5.04. Redemption of the Class R Certificates
(a) Full Redemption on Final Scheduled Monthly Payment Date.
The Class R Certificates will be redeemed or paid in full on or before
December 1, 2029 (the "Final Scheduled Monthly Payment Date") to the
extent not redeemed or paid prior thereto.
(b) Optional Certificate Redemption. The Depositor or its
assignee may, by written demand to the Issuer Certificate Agent, cause
the Issuer to redeem on a Monthly Payment Date all but not less than
all of the Class R Certificates at a price equal to 105% of the
Outstanding Certificate Balance of the Class R Certificates on such
Monthly Payment Date (the "Optional Certificate Redemption Amount").
Such demand shall be delivered at least 10 calendar days but no more
than 25 calendar days prior to the Monthly Payment Date on which the
redemption is to occur. Prior to any redemption of the Class R
Certificates, the Optional Certificate Redemption Amount shall be
deposited into the Trust Agreement Collection Account by the Depositor
or its assignee no later than the 9th calendar day prior to such
Monthly Payment Date selected for redemption of the Class R
Certificates. Such redemption shall occur on the Monthly Payment Date
specified in the written notice, which date shall be on or after the
earlier of (A) March 1, 2005 and (B) the first Monthly Payment Date on
which the remaining balance of the Agency Securities shall be equal to
or less than 20% of the principal amount of the Agency Securities (at
original issuance), after giving effect to any principal payments on
such Monthly Payment Date (the "Permitted Certificate Redemption
Date"). Upon redemption of the Class R Certificates, the party that
effected the redemption by depositing the Optional Certificate
Redemption Amount shall own the entire beneficial ownership interest in
the Issuer until the Notes are redeemed or paid in full and the Issuer
is terminated, and such party shall have the right to direct redemption
of the Notes pursuant to the Indenture. Such party's ownership interest
in the Issuer shall be subject to the same ownership and transfer
restrictions as the Class R Certificates, which are set forth in
Section 4.05 hereof.
(c) Assignment of Optional Redemption Rights. Pursuant to the
Purchase Agreement, the Depositor has assigned all of its rights to
direct the Issuer to redeem the Class R Certificates pursuant to
Section 5.04(b) above to the Seller, and the Issuer Trustee and the
Issuer Certificate Agent hereby acknowledge such assignment and agree
to act in accordance with the directions of the Seller under this
Section 5.04. No further assignment of this right shall be effective
unless and until the Issuer Trustee and the Issuer Certificate Agent
have been notified of such assignment in writing by the Seller or the
entity whom the Issuer Trustee and the Issuer Certificate Agent most
recently have been notified by the Seller is the assignee of such
right.
Section 5.05. Account Statements; Other Reports
(a) Within five Business Days following each Monthly Payment
Date, the Issuer Certificate Agent shall furnish or make available to
the Issuer Trustee and each Certificateholder a statement (an "Account
Statement") setting forth the status of the Note Collection Account,
the Interest Reserve Account, the Expense Reserve Account and the Trust
Agreement Collection Account, showing, for the related Interest Accrual
Period, deposits in or withdrawals from the Note Collection Account,
the Interest Reserve Account, the Expense Reserve Account and the Trust
Agreement Collection Account and proceeds of investments of funds in
the Note Collection Account, the Interest Reserve Account and the
Expense Reserve Account. The Account Statement shall also set forth the
following information: (i) the Outstanding Principal Amounts of each
class of the Notes and the Outstanding Certificate Balance of the Class
R Certificates, respectively, as of the close of business on the first
day of the immediately preceding Interest Accrual Period; (ii) the
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amounts in the Note Collection Account, the Interest Reserve Account,
the Expense Reserve Account and the Trust Agreement Collection Account
as of the end of the immediately preceding Interest Accrual Period;
(iii) the amounts of such funds in the Note Collection Account (and, if
any, the Interest Reserve Account) applied toward the payment of any
Note Interest Amount on either Class of the Notes on the preceding
Monthly Payment Date; (iv) the amount, if any, of such amounts in the
Note Collection Account applied toward the reduction of the Outstanding
Principal Amount of each Class of the Notes on the preceding Monthly
Payment Date; (v) the amounts, if any, of such amounts in the Trust
Agreement Collection Account applied toward the reduction of the
Outstanding Certificate Balance of the Class R Certificates and to pay
investment yield on the Class R Certificates on the preceding Monthly
Payment Date; and (vi) the Outstanding Principal Amount of each Class
of the Notes and the Outstanding Certificate Balance of the Class R
Certificates, respectively, as of the close of business on the
preceding Monthly Payment Date after distributions are made on the
Notes and Certificates, as applicable, on such Monthly Payment Date.
Promptly following the receipt of any tax or information
reports that it receives relating to the Agency Securities, the Issuer
Certificate Agent (or, to the extent that any such reports are received
by the Issuer Trustee, the Issuer Trustee) shall forward to each
Certificateholder a copy of any tax or information reports that it
receives relating to the Agency Securities.
The Issuer Certificate Agent shall supply to the Note Trustee
any and all information requested by the Note Trustee to enable it to
prepare and furnish the reports it is required to furnish to
Noteholders pursuant to the Indenture.
(b) The Internal Revenue Service has proposed regulations
requiring certain reporting by trustees to holders of "widely held
fixed investment trusts." To avoid the expense of any such reporting,
by acquiring the Class R Certificates, whether on original issue or in
a secondary purchase, each Certificateholder agrees as follows:
(i) The Certificateholder shall hold such Class R
Certificates directly and not through a "middleman." For this
purpose, a "middleman" is any person who holds an interest on
behalf of, or for the account of, another person, or who
otherwise acts in a capacity as an intermediary for the
account of another person, including, without limitation, a
custodian, such as a bank, financial institution or brokerage
firm; a nominee, including the joint owner of an account,
except if the joint owners are husband and wife; or a broker
holding an interest for a customer in street name.
(ii) If Proposed Treasury Regulations Section
1.671-4(j) shall become final in a form which permits such
Certificateholder to request quarterly information, the
Certificateholder agrees that it shall request such
information only upon making provision for additional
compensation to the Issuer Certificate Agent for the expenses
of providing such information.
(iii) The Certificateholder agrees not to transfer
such Class R Certificates to any person unless such person
agrees to these provisions in writing for the benefit of the
Issuer.
(c) The Issuer Certificate Agent, on behalf of the Issuer,
shall supply to any prospective transferee of Class R Certificates
pursuant to Rule 144A of the Securities Act, upon request of the
transferor, the information required under Rule 144A(d)(4) promulgated
under the
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Securities Act of 1933, as amended. The Issuer Certificate Agent shall
only be responsible for furnishing information relating to the Agency
Securities, the Note Collection Account, the Interest Reserve Account,
the Expense Reserve Account, the Trust Agreement Collection Account,
the Notes and the Class R Certificates under this Section 5.05(c), and
the Issuer Certificate Agent shall have no responsibility for the
accuracy of any such information supplied to it by another person nor
for the sufficiency of the information so supplied by it to any
prospective transferee.
Section 5.06. Books and Records
The Issuer Certificate Agent shall be responsible for the keeping of
all appropriate books and records relating to the receipt and disbursement of
all moneys under this Agreement. The Issuer Certificate Agent will forward to
the Certificateholders copies of any ▇▇▇▇ or invoice requiring payment by the
Issuer for services rendered or other correspondence regarding amounts owed or
expenses incurred by the Issuer promptly upon receipt. To the extent that any
such bills or invoices are received by the Issuer Trustee, the Issuer Trustee
will forward such bills or invoices to the Issuer Certificate Agent promptly
upon receipt. The Certificateholders shall be responsible for causing to be
prepared and filed, at their respective expense, all income tax returns required
to be filed by the Certificateholders. The Certificateholders shall also be
responsible for causing to be prepared and filed, at their expense, all income
tax returns, if any, required to be filed for the trust created hereby and shall
execute and file such returns, with a copy sent to the Issuer Certificate Agent.
The Issuer Certificate Agent, upon request, will furnish the Certificateholders
with all such information in its possession as may be reasonably required from
the Issuer Certificate Agent in connection with the preparation of all income
and tax returns. Upon written request of the Certificateholders, the Issuer
Trustee shall execute and file such returns prepared by the Certificateholders.
ARTICLE VI:
CERTIFICATE TERMINATION EVENTS
Section 6.01. Certificate Termination Events.
A Certificate Termination Event (provided that none of the following
shall constitute a Certificate Termination Event until all of the Notes are paid
in full) shall occur if:
(a) failure by the Issuer to make (or cause to be made on its
behalf) a redemption in full on or before the Final Scheduled Monthly
Payment Date of the Class R Certificates;
(b) failure by the Issuer to make (or cause to be made on its
behalf) on any Monthly Payment Date a distribution to
Certificateholders of the Available Funds (as reduced by any payments
pursuant to Section 5.03(a) on such Monthly Payment Date) for such
Monthly Payment Date.
(c) failure by the Issuer duly to observe or to perform any
other covenant or agreement of the Issuer under this Agreement, the
Class R Certificates or any other Transaction Document (as defined in
this Agreement), as the case may be, which failure (i) materially
adversely affects the rights of the Certificateholders and (ii)
continues unremedied for a period of 30 days (or, with respect to any
covenant or agreement relating to the remittance of distributions and
other amounts by the Issuer, a period of 5 days) after the earlier of
(x) a responsible officer of the Issuer becoming aware of such default
and (y) the giving of written notice of such failure by the Issuer
Certificate Agent or by any Certificateholder;
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(d) any representation, warranty, certification or statement
made by the Issuer in this Agreement or in any Transaction Document,
financial statement or other document delivered pursuant to any
Transaction Document shall prove to have been incorrect in any material
respect when made (or deemed made);
(e) (i) the Issuer shall become insolvent or bankrupt; or
shall admit in writing its inability to pay its debts or honor its
obligations, or shall apply to any tribunal for the appointment of a
receiver, liquidator or trustee of or for itself or for all or any
substantial part of its property or assets; (ii) a receiver, liquidator
or trustee of or for the Issuer (or for all or any substantial part of
its property or assets) is appointed and not discharged within 60 days;
or (iii) any bankruptcy, insolvency, reorganization, arrangement or
liquidation proceedings (or similar proceedings analogous in purpose
and effect) shall be instituted by or against the Issuer, or any
supervisory authority having jurisdiction in the premises shall have
taken possession of the business or property of the Issuer with a view
to the liquidation of its affairs or the conservation of its assets,
and in either case, are consented to by the Issuer, or are not
dismissed within 60 days;
(f) the rendering of any final judgment, enforceable in any
competent court, against the Issuer, for the payment of money equal to
or in excess of U.S. $10,000, and such judgment shall not be discharged
or dismissed or execution thereon stayed pending appeal within 60 days
after entry; or
(g) the Certificate of Trust, this Agreement or other related
organizational documents of the Issuer shall be amended without the
written consent of the Majority Certificateholders and, where required
hereunder or the Indenture, the Noteholders.
Section 6.02. Consequences of a Certificate Termination Event.
If a Certificate Termination Event with respect to the Class R
Certificates occurs and is continuing, the Issuer Certificate Agent at the
direction of the Majority Certificateholders will cause the Issuer to be
dissolved and terminated, or, upon the occurrence of the Certificate Termination
Event described in Section 6.01(e), the Issuer Certificate Agent shall cause the
Issuer to be dissolved and terminated without any notice from
Certificateholders. Upon any such dissolution, all of the property of the Issuer
(other than amounts in the Expense Reserve Account) will be distributed by the
Issuer Certificate Agent pro rata to the Certificateholders, subject to the
payment provisions for liabilities as required by Section 3808 of the Act. The
Issuer Trustee shall comply with all directions given to it by the Issuer
Certificate Agent to the extent any action by the Issuer Trustee is required to
enable the Issuer Certificate Agent to perform its duties hereunder.
Section 6.03. Issuer Certificate Agent Termination Events.
Upon the occurrence of either of the events specified in clauses (a)
and (b) of Section 6.01 (each, an "Issuer Certificate Agent Termination Event"),
the Majority Certificateholders may, or the Issuer Trustee at the direction of
the Majority Certificateholders will, replace the Issuer Certificate Agent in
accordance with Section 4.13.
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ARTICLE VII:
RIGHTS, OBLIGATIONS, POWERS AND STATUS
OF THE CERTIFICATEHOLDERS
Section 7.01. Management of the Issuer.
It is the intention of the parties hereto, and the Certificateholders
by their acceptance of their Class R Certificate(s) shall be deemed to agree,
that the Issuer Trustee's duties are to be ministerial in nature only. The
Certificateholders shall have the exclusive right and obligation to determine
the matters herein referenced to be determined by the Certificateholders and to
direct the Issuer Trustee (and the Issuer Certificate Agent, as the case may be)
to carry out and accomplish such matters, and the Certificateholders, in that
capacity, subject to the provisions of the Act, the other provisions of this
Agreement and the Transaction Documents, shall direct the Issuer Trustee (and
the Issuer Certificate Agent, as the case may be) in the management of the
business and affairs of the Issuer in order best to carry out the Issuer's
purposes.
Section 7.02. Bankruptcy, Dissolution or Termination of any
Certificateholder.
The incapacity, dissolution, termination or bankruptcy of any
Certificateholder shall not result in the termination or dissolution of the
Issuer.
Section 7.03. Creditors of the Certificateholders.
As is provided in paragraph (b) of Section 3805 of the Act, no creditor
of a Certificateholder shall have any right to obtain possession of, or
otherwise exercise legal or equitable remedies with respect to, the Issuer
Estate.
Section 7.04. Certain Rights of the Majority Certificateholders.
The Majority Certificateholders shall have the right to direct the
following matters on behalf of all Certificateholders:
(a) directing the Issuer Trustee in accordance with Sections
7.01, 8.01(d) and 8.01(f);
(b) instructing the Issuer Trustee to amend the Certificate of
Trust in accordance with Section 8.03(a) or 12.07;
(c) appointing a replacement Issuer Trustee pursuant to
Section 8.05;
(d) instructing the Issuer Trustee to appear in, prosecute or
defend any action in accordance with Section 8.08(a); and
(e) instructing the Issuer Certificate Agent as to the
exercise, at such Majority Certificateholders expense, of the Issuer
Certificate Agent's authority under Section 8.02, taking any action
with regard to the Issuer Certificate Agent pursuant to Section 4.13,
or removing or appointing a replacement Issuer Certificate Agent
pursuant to Section 6.03 and Section 4.13.
Section 7.05. Tax Status.
(a) It is the intention of the parties hereto, and the
Certificateholders by their acceptance of their Class R Certificate(s)
shall be deemed to agree, that for Federal income tax purposes, the
Issuer and the ownership of the Class R Certificates shall be treated
as follows:
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(i) At such time as there is only one
Certificateholder, the Issuer shall be treated as a
disregarded entity and the Certificateholder shall be treated
as holding the assets of the Issuer directly and shall report
the income of the Issuer accordingly.
(ii) At such time as there is more than one
Certificateholder, the Issuer shall be treated as a
partnership and each Certificateholder shall be treated as a
partner of the partnership. The period for which there is more
than one Certificateholder shall be divided into accounting
periods, with a new accounting period beginning at the
beginning of each taxable year and at the time that the
identity of any Certificateholder changes. The Issuer's income
shall be divided among such accounting periods using any
reasonable convention. The income for any accounting period
shall be allocated to the Certificateholders who hold Class R
Certificates during such periods in proportion to the original
face amount of the Class R Certificates held by the
Certificateholders. The Certificateholder holding the largest
original face amount of Class R Certificates shall act as "Tax
Matters Partner" within the meaning of Code section 6231(a)(7)
of the deemed partnership and shall be responsible for the
preparation and filing of the partnership tax return. The Tax
Matters Partner may vary the allocation provided for herein to
the extent it deems it advisable to satisfy the requirements
of Code section 704(b) and the Treasury Regulations
promulgated thereunder.
If the Class R Certificates have been redeemed, the entity who
directed such redemption pursuant to Section 5.04, and who deposited
the Optional Certificate Redemption Amount, shall be considered the
sole Certificateholder for purposes of this Section 7.05 until the
Issuer is terminated.
(b) The Notes will be treated as indebtedness of the Issuer.
(c) To the extent that any of the parties hereto is required
to report any item of income, gain, loss, deduction or credit relating
to the Issuer for United States federal, state or local income tax
purposes, such party shall report such item in a manner consistent with
the characterization intended by this Section 7.05 and shall not take
any contrary position on any tax return or report relating to the
United States federal, state or local income taxes or take any other
action which is inconsistent with such characterization.
ARTICLE VIII:
CONCERNING THE ISSUER TRUSTEE AND CHRISTIANA BANK & TRUST COMPANY
Section 8.01. General
(a) In the exercise or administration of the Issuer hereunder,
the Issuer Trustee at the expense of the Issuer (to be paid as provided
in Section 8.07) (i) may act directly or through agents or attorneys
pursuant to agreements entered into with any of them, and the Issuer
Trustee shall not be liable for the default or misconduct of such
agents or attorneys if such agents or attorneys shall have been
selected by the Issuer Trustee with reasonable care; and (ii) may
consult with counsel, accountants and other skilled Persons to be
selected with reasonable care and employed by the Issuer Trustee, and
it shall not be liable for anything done, suffered or omitted in good
faith by it in accordance with the advice or opinion of any such
counsel, accountants or other skilled Persons.
(b) Except as expressly provided herein, (i) in accepting the
trust hereby created, Christiana Bank & Trust Company acts solely as
Issuer Trustee hereunder and not in its individual
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capacity, and (ii) all Persons having any claim against the Issuer or
the Issuer Trustee by reason of the transactions contemplated by this
Agreement shall look only to the Issuer Estate for payment or
satisfaction thereof.
(c) Except in accordance with the written instructions
furnished by the Majority Certificateholders and except as provided
herein, the Issuer Trustee shall have no duty to (i) see to any
recording or filing of any document, or (ii) see to the payment or
discharge of any tax, assessment or other governmental charge or any
lien or encumbrance of any kind owing with respect to, assessed or
levied against any part of the Issuer.
(d) The Issuer Trustee will manage the business and affairs of
the Issuer in accordance with the terms of the Act and the Transaction
Documents subject to Section 8.02(b); provided, however, that the
Issuer Trustee undertakes to perform only such duties as are
specifically set forth in this Agreement or as the Issuer Trustee may
be duly directed from time to time in writing by the Majority
Certificateholders in accordance with and subject to the Transaction
Documents and as the Issuer Trustee is required to in order to comply
with the Transaction Documents. The Issuer Trustee shall not have any
duty or obligation to manage, control, use, sell, dispose of or
otherwise deal with the Issuer or to otherwise take or refrain from
taking any action under this Agreement or the other Transaction
Documents except as expressly required by the terms hereof (or of the
other Transaction Documents) or as expressly provided in written
instructions from the Majority Certificateholders in accordance with
the Transaction Documents, and no implied duties or obligations shall
be read into this Agreement and the other Transaction Documents against
the Issuer Trustee. The Issuer Trustee shall not be required to take
any action under this Agreement and the other Transaction Documents if
the Issuer Trustee shall have reasonable grounds for believing that
repayment of such funds or indemnification, in manner and form
satisfactory to this Issuer Trustee, against any liability, cost or
expense (including reasonable counsel fees and disbursements) which may
be incurred in connection therewith, is not reasonably assured or
provided to it. Christiana Bank & Trust Company nevertheless agrees
that it will, at its own cost and expense (and not at the expense of
the Issuer), promptly take all action as may be necessary to discharge
any Liens on any part of the Issuer Estate which are attributable to
actions by or claims against Christiana Bank & Trust Company that are
not related to the ownership of any part of the Issuer Estate or the
administration of the Issuer Estate or the transactions contemplated by
this Agreement.
(e) The Issuer Trustee shall not be required to take any
action under this Agreement if the Issuer Trustee shall reasonably
determine or shall have been advised by counsel that such action is
contrary to the terms of this Agreement or is otherwise contrary to
law.
(f) Whenever the Issuer Trustee is unable to decide between
alternative courses of action permitted or required by the terms of
this Agreement, or is unsure as to the application, intent,
interpretation or meaning of any provision hereof, the Issuer Trustee
may give notice (in such form as shall be appropriate under the
circumstances) to the Certificateholders requesting written
instructions as to the course of action to be adopted, and, to the
extent the Issuer Trustee acts in good faith in accordance with any
such appropriate written instruction received from the Majority
Certificateholders, the Issuer Trustee shall not be liable on account
of such action or inaction to any Person. If the Issuer Trustee shall
not have received appropriate written instructions within ten days of
providing such notice (or within such shorter period of time as
reasonably may be specified in such notice or may be necessary under
the circumstances), it may, but shall be under no duty to, take or
refrain from taking such action which is consistent, in its
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view, with this Agreement and as it shall deem to be in the best
interests of the Certificateholders, and the Issuer Trustee shall have
no liability to any Person for any such action or inaction.
(g) In no event whatsoever shall the Issuer Trustee be liable
for any representation, warranty, covenant, agreement, indebtedness or
other obligation of the Issuer; provided, however, the foregoing shall,
in no event whatsoever, relieve the Issuer Trustee from any liability
resulting from the Issuer Trustee's bad faith, willful misconduct or
gross negligence.
(h) The Issuer Trustee may rely upon and shall incur no
liability to anyone in acting upon any signature, instrument, notice,
resolution, request, consent, order, certificate, report, opinion, bond
or other document or paper reasonably believed by it to be genuine and
reasonably believed by it to be signed by the proper party or parties.
The Issuer Trustee may accept a certified copy of a resolution of the
board of directors or other governing body of any corporate party as
conclusive evidence that such resolution has been duly adopted by such
body and that the same is in full force and effect. As to any fact or
matter the manner of ascertainment of which is not specifically
prescribed herein, the Issuer Trustee may for all purposes hereof rely
on a certificate, signed by the president or any vice president or by
the treasurer or any assistant treasurer or the secretary or any
assistant secretary (or equivalent position) of the relevant party, as
to such fact or matter, and such certificate shall constitute full
protection to the Issuer Trustee for any action taken or omitted to be
taken by it in good faith reliance thereon.
(i) Except as expressly provided or warranted by the Issuer
Trustee herein, the recitals contained in this Agreement and in the
Class R Certificates shall be taken as statements of the Depositor, and
the Issuer Trustee assumes no responsibility for their correctness.
Except as expressly provided or warranted by the Issuer Trustee herein,
the Issuer Trustee makes no representations as to the validity or
sufficiency of this Agreement or the Class R Certificates or of any of
the assets of the Issuer or the documents relating to the assets of the
Issuer.
Section 8.02. Acceptance of the Issuer
(a) The Issuer Trustee declares that it accepts the trust
hereby created and agrees to perform its duties under this Agreement
and the Act but only upon the terms of this Agreement and as
contemplated by the Transaction Documents.
(b) It is understood and agreed that the duties and
responsibilities of the Issuer Trustee shall be limited to (i)
accepting legal process served on the Issuer in the State of Delaware,
(ii) the execution, delivery and filing of all documents, and the
maintenance of all records, necessary to form and maintain the
existence (or to terminate the existence of) of the Issuer under the
Act, (iii) monitoring changes to the Act insofar as such changes may
affect the existence of the Issuer under the Act and this Agreement,
and advising the Certificateholders when action is necessary to comply
with the Act and (iv) such other duties and responsibilities of the
Issuer Trustee as set forth herein and in the other Transaction
Documents. The Issuer Trustee shall have the duties, obligations and
responsibilities explicitly set forth herein and in the other
Transaction Documents only. Any other reference to the Issuer shall
mean that the Issuer Certificate Agent has the authority to take any
action or exercise any power on behalf of the Issuer in its capacity as
Issuer Certificate Agent and shall be the sole responsibility of State
Street. The Issuer Certificate Agent, on behalf of the Issuer Trustee,
will prepare, furnish and file any and all reports or notices as
required by the Terms Indenture. Without limiting the generality of the
foregoing, the Issuer Trustee agrees that the Issuer Certificate Agent
shall have the absolute power to act for the Issuer in all
circumstances in which it is provided herein that the Issuer
Certificate Agent shall perform certain action, including without
limitation, redemptions of the Class R Certificates or the Notes
pursuant to Sections 5.04
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and 9.01 hereof, and actions upon a Certificate Termination Event
pursuant to Section 6.02, and that such actions by the Issuer
Certificate Agent will constitute acts of the Issuer.
(c) Except as otherwise expressly required by Sections 8.01(g)
and 8.02(b) above, the Issuer Trustee shall not have any duty or
liability with respect to the Issuer.
(d) Except for the representations, warranties and covenants
set forth in Sections 8.04 and 8.01(d) hereof, in accepting and
performing the trust hereby created, the Issuer Trustee acts solely as
the trustee hereunder and not in its individual capacity, and all
persons having any claim against the Issuer Trustee by reason of the
transactions contemplated by this Agreement or any other Transaction
Document shall look only to the Issuer Estate for payment or
satisfaction thereof.
Section 8.03. Authority and Duties of the Issuer Trustee
(a) The Issuer Trustee is authorized and directed to execute
and deliver this Agreement, the Indenture, the Deposit Agreement, the
Underwriting Agreement and the Certificate Placement Agreement, and
each certificate or other document attached as an exhibit to or
contemplated by any such agreement. The execution and delivery of, and
performance of the terms of, the Indenture, the Underwriting Agreement,
the Certificate Placement Agreement, the Deposit Agreement and each
certificate or other document attached as an exhibit to or otherwise
expressly contemplated by any such agreement shall be deemed not to
conflict with or constitute a breach or default under this Agreement.
The Issuer Trustee shall have only such authority and duties as are
expressly set forth in this Agreement or the other Transaction
Documents. The Issuer Trustee shall, upon the written instruction of
the Majority Certificateholders, to the extent permitted by, and
subject to the conditions contained in, the Transaction Documents, (i)
amend the Certificate of Trust (provided that such amendment may only
be made with the prior written consent of the holders of at least
two-thirds of the Notes by Outstanding Principal Amount, and if the
Issuer Trustee was not instructed by the Majority Certificateholders to
make such amendment, the Issuer Trustee shall have received the prior
written consent of the Majority Certificateholders), (ii) (x) amend any
provision of the Indenture in accordance with the terms thereof and (y)
appoint or approve of a replacement Note Trustee in accordance with the
terms of the Indenture and (iii) execute, acknowledge, deliver, file or
record any document or instrument necessary or appropriate to carry out
the provisions of this Agreement, the Indenture or the Deposit
Agreement in such form as is provided to it; provided that such action
does not alter the rights, powers and duties of the Issuer Trustee as
set forth in this Article VIII.
(b) The Issuer Trustee shall have the power and authority to
execute, deliver, acknowledge and file all necessary documents and to
maintain all necessary records of the Issuer as required by the Act.
(c) The Issuer Trustee shall not have the right to make an
election with the Internal Revenue Service that would cause the Issuer
not to be disregarded as an entity for federal income tax purposes.
(d) It is expressly understood and agreed by the parties that
each of the representations, undertakings, covenants and agreements
made on the part of the Issuer herein is made and intended not as a
personal representation, undertaking, covenant or agreement by the
Issuer Trustee, but is made and intended for the purpose of binding the
Issuer. The Issuer Trustee shall not be under any liability to the
Issuer Certificate Agent, the Certificateholders, the Depositor or any
other Person for any action taken or for refraining from the taking of
any action in its
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capacity as Issuer Trustee pursuant to this Agreement; provided,
however, that this provision shall not protect the Issuer Trustee
against any liability which would otherwise be imposed by reason of
willful misfeasance, bad faith or gross negligence in the performance
of its duties or by reason of reckless disregard of its obligations and
duties hereunder. The Issuer Trustee may rely in good faith on any
document of any kind prima facie properly executed and submitted by any
other Person respecting any matters arising hereunder.
(e) The obligations of the Issuer under this Agreement and the
Class R Certificates are obligations solely of the Issuer. This
Agreement and the Class R Certificates do not represent an obligation
of, or an interest in, the Issuer Trustee or any of its affiliates and
no recourse may be had against the Issuer Trustee or its assets, except
as may be expressly set forth or contemplated herein or in the Class R
Certificates.
Section 8.04. Representations and Warranties of Christiana Bank & Trust
Company.
Christiana Bank & Trust Company, in its individual capacity, hereby
represents and warrants to the Depositor and the Holders from time to time of
the Class R Certificates that:
(a) Corporate Existence and Power. Christiana Bank is a
banking corporation duly incorporated, validly existing and in good
standing under the laws of the State of Delaware and has all corporate
powers and all governmental licenses, authorizations, consents and
approvals required to carry on its business as now conducted and as
contemplated by this Agreement.
(b) Corporate and Governmental Authorization; No
Contravention. The execution, delivery and performance by Christiana
Bank of this Agreement are within Christiana Bank's corporate powers,
have been duly authorized by all necessary corporate action, require no
action by or in respect of, or filing with, any governmental body,
agency or official and do not contravene, or constitute a default
under, any provision of applicable law or regulation of the State of
Delaware or of the Certificate of Incorporation or the Bylaws of
Christiana Bank or of any agreement or other instrument binding upon
Christiana Bank or result in the creation or imposition of any Lien on
any asset of Christiana Bank.
(c) Binding Obligation. This Agreement has been duly
authorized, and when executed and delivered by Christiana Bank,
assuming the due authorization and delivery by each party hereto, shall
constitute the legal, valid, enforceable and binding obligation of
Christiana Bank, enforceable against it in accordance with its
respective terms, except as subject to applicable bankruptcy,
insolvency, reorganization, moratorium or other similar laws now or
hereafter in effect, affecting the enforcement of creditors' rights in
general and except as such enforceability may be limited by general
principles of equity (whether considered in a proceeding at law or in
equity).
(d) Compliance with Act. Christiana Bank complies with all the
requirements of the Act relating to the qualification of a trustee of a
Delaware statutory business trust.
Section 8.05. Resignation of the Issuer Trustee.
(a) The Issuer Trustee may not resign and be discharged of the
trust created by this Issuer Trust Agreement unless (i) the Issuer
Trustee shall provide 30 days' written notice to the
Certificateholders, (ii) the Issuer Trustee shall locate a successor
Issuer Trustee satisfying the eligibility requirements for such
successor Issuer Trustee set forth in this Section 8.05, (iii) the
Issuer Trustee shall have agreed with such successor Issuer Trustee as
to fees and expenses to be
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paid such successor Issuer Trustee for serving as Issuer Trustee with
respect to the Issuer so long as any Class R Certificates or Notes are
Outstanding and, if such agreed-upon fees and expenses to be paid the
successor Issuer Trustee exceed the amounts remaining in the Expense
Reserve Account allocated to the Issuer Trustee, the Issuer Trustee
shall make provisions for such shortfall in a manner satisfactory to
such successor Issuer Trustee and (iv) such successor Issuer Trustee
shall agree to be assigned all of the rights and powers, and to assume
all of duties and obligations, of the Issuer Trustee set forth in this
Agreement and the other Transaction Documents, and such resignation
shall take effect upon receipt by the predecessor Issuer Trustee of an
instrument of acceptance of appointment executed by a successor Issuer
Trustee as herein provided and consented to by at least two-thirds of
the Noteholders and the Majority Certificateholders (such consent to be
deemed consent to the certificate of amendment provided for in Section
8.05(d); provided that such Person shall in all respects satisfy the
requirements of Section 3807 of the Act, or any successor provision,
and shall be a bank or trust company incorporated, or a banking
association organized, and doing business within the United States of
America, whose business shall consist at least in part as serving as
Issuer Trustee in asset securitization transactions and having a
combined capital and surplus of at least $100,000,000, if there be such
an institution willing, able and legally qualified to perform the
duties of the Issuer Trustee hereunder upon reasonable or customary
terms. The appointment of the successor Issuer Trustee shall take
effect concurrently with the resignation of the former Issuer Trustee,
and no resignation of an Issuer Trustee shall be effective absent the
concurrent appointment of a successor Issuer Trustee.
(b) If a successor Issuer Trustee shall not have been
appointed within 60 days after such notice of resignation, the Issuer
Trustee or the Majority Certificateholders may apply to any court of
competent jurisdiction to appoint a successor Issuer Trustee to act
until such time as a successor shall have been appointed as above
provided.
(c) Any corporation or banking association into which the
Issuer Trustee may be merged or converted or with which it may be
consolidated, or any corporation or banking association resulting from
any merger, conversion or consolidation to which the Issuer Trustee
shall be a party, or any corporation to which substantially all the
corporate trust business of the Issuer Trustee may be transferred,
shall, subject to such corporation or banking association satisfying in
all respects the requirements set forth in Section 8.05(a), be the
Issuer Trustee hereunder without further action.
(d) Upon the substitution of the Person serving as Issuer
Trustee, the successor Issuer Trustee shall file an amendment to the
Certificate of Trust with the Secretary of State of the State of
Delaware in accordance with the provisions of Section 3810 of the Act,
indicating the change in the Issuer Trustee and no other change.
Section 8.06. Indemnification.
(a) Each of the Issuer Trustee, its officers, directors,
employees, shareholders and agents (collectively the "Indemnified
Persons" or individually an "Indemnified Person") will be indemnified,
protected, and held harmless from and against any and all liabilities,
obligations, losses, damages, actions, judgments, suits, proceedings,
taxes, costs, expenses and disbursements of any kind or nature
whatsoever including, without limitation, all reasonable legal fees,
costs and expenses of defense, appeal and settlement of any and all
suits, actions, or proceedings instituted against such Indemnified
Person or the Issuer and all reasonable costs of investigation in
connection therewith that may be imposed on, incurred by, or asserted
against an Indemnified Person relating to or arising out of any action
or inaction on the part of the Issuer or an
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Indemnified Person in respect of the Issuer; provided, that a court of
competent jurisdiction has not found such liabilities to have resulted
primarily from such Indemnified Person's own bad faith, willful
misconduct or gross negligence. The Indemnified Persons' rights to
indemnification as provided herein shall survive the termination of
this Agreement.
(b) The Issuer Trustee shall not be personally responsible for
or in respect of the validity or sufficiency of this Agreement or the
other Transaction Documents, the validity, value or genuineness of any
Issuer asset or for the execution hereof or performance of the
obligations of any other party hereunder. The provisions of this
Agreement, to the extent that they restrict the duties and liabilities
of the Issuer Trustee otherwise existing at law or in equity, replace
such other duties or liabilities of the Issuer Trustee to the extent
permissible under law or in equity. Notwithstanding anything contained
herein to the contrary, the Issuer Trustee shall have no duty or
liability with respect to compliance by the Issuer, the
Certificateholders or any other Person with (A) the Securities Act, the
Investment Company Act of 1940, as amended, or any other applicable
Federal or state securities laws, rule or regulations, (B) ERISA or (C)
the Code. The Issuer Trustee shall not be personally liable for any
error of judgment made in good faith. The Issuer Trustee shall not be
required to take any action that (i) is inconsistent with the purposes
of the Issuer set forth herein or (ii) would, to the actual knowledge
of an officer of the Issuer Trustee, result in the Issuer becoming an
association taxable as a corporation for federal income tax purposes.
(c) The indemnity provided for by this Section 8.06 shall
supersede and replace any indemnity provided to the Issuer Trustee
under the Prior Agreement of Trust and the Issuer Trustee agrees to
look solely to the Trust Agreement Collection Account as provided for
in Section 5.03(a) of this Agreement for any indemnification obligation
owed to it hereunder or under the Prior Agreement of Trust.
Section 8.07. Fees and Expenses.
The Issuer Trustee shall receive as compensation for its services
hereunder the fee specified in Section 6.02 of the Indenture, subject to the
limitations set forth therein, which amount shall also cover the costs to the
Issuer Trustee of all ordinary expenses incurred in the performance of its
duties hereunder. The Issuer Trustee shall be compensated reasonably for any
extraordinary services rendered by it hereunder and for all reasonable
out-of-pocket expenses, disbursements and advances (other than those ordinary
expenses, disbursements and advances incurred in the normal administration of
its obligations hereunder which are internal costs covered by its fees) incurred
or made by the Issuer Trustee as provided in Section 5.03(a).
Section 8.08. Litigation, Action Outside Delaware.
(a) The Issuer Trustee shall not be under any obligation to
appear in, prosecute or defend any action which in its opinion may
require it to incur any out-of-pocket expense or any liability, unless
it shall be furnished with such reasonable security and indemnity
against such expense or liability as it may require, and any
out-of-pocket cost of the Issuer Trustee as a result of such actions
shall be paid by the Issuer.
(b) Notwithstanding anything contained herein to the contrary,
the Issuer Trustee shall not be required to take any action in any
jurisdiction other than in the State of Delaware if the taking of such
action will (i) require the consent or approval or authorization or
order of or the giving of notice to, or the registration with or the
taking of any other action in respect of, any state or other
governmental authority or agency of any jurisdiction other than the
State of Delaware; (ii) result in any fee, tax or other governmental
charge under the laws of any jurisdiction or any political subdivisions
thereof in existence on the date hereof other than the State of
Delaware
Agreement of Trust
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becoming payable by the Issuer Trustee; or (iii) subject the Issuer
Trustee to personal jurisdiction in any jurisdiction other than the
State of Delaware for causes of action arising from acts unrelated to
the consummation of the transactions by the Issuer Trustee contemplated
hereby. The Issuer Trustee shall be entitled to obtain advice of
counsel (which advice shall be an expense of the Issuer) to determine
whether any action required to be taken pursuant to this Agreement
results in the consequences described in clauses (i), (ii) and (iii) of
the preceding sentence. In the event that said counsel advises the
Issuer Trustee that such action will result in such consequences, the
Issuer Trustee may resign pursuant to Section 8.05 hereof.
ARTICLE IX:
REDEMPTION OF NOTES
Section 9.01. Optional Redemption of the Notes.
The holders of all of the Class R Certificates may direct the Issuer to
redeem all but not less than all of the Notes at a price equal to 100% of the
Outstanding Principal Amount of the Notes (the "Optional Note Redemption
Amount") on any Monthly Payment Date on or after the earlier of (A) June 1, 2005
and (B) the first Monthly Payment Date on which the remaining balance of the
Agency Securities shall be equal to or less than 20% of the principal amount of
the Agency Securities (at original issuance), after giving effect to any
principal payments on such Monthly Payment Date (any such date, a "Permitted
Note Redemption Date"); provided that if the Seller, as assignee of the
Depositor, has caused the Issuer to redeem the Class R Certificates or has
delivered a written demand to the Issuer Certificate Agent for the optional
redemption of the Class R Certificates to occur on the upcoming Monthly Payment
Date then the Seller, and not the holders of the Class R Certificates, shall
have the right to cause the Notes to be redeemed. The Issuer Certificate Agent
shall deliver to the Note Trustee a written demand for such redemption no later
than one business day after receipt of written direction to cause such
redemption as described in the preceding sentence. In order for a redemption of
the Notes to occur on a particular Monthly Payment Date, (i) the Issuer
Certificate Agent shall have delivered to the Note Trustee a written demand for
such redemption at least 10 days but no greater than 25 days prior to the
Monthly Payment Date selected for such redemption, and (ii) the Optional Note
Redemption Amount shall have been deposited into the Note Collection Account no
later than the 9th calendar day prior to such Monthly Payment Date. Without
limiting the generality of the foregoing, the Issuer Trustee agrees that the
Issuer Certificate Agent shall perform certain actions, including without
limitation, redemptions of the Class R Certificates or the Notes pursuant to
Sections 5.04 and 9.01 hereof, and actions upon a Certificate Termination Event
pursuant to Section 6.02, and that such actions by the Issuer Certificate Agent
will constitute acts of the Issuer.
ARTICLE X:
DISSOLUTION, BANKRUPTCY AND LIQUIDATION OF THE ISSUER
Section 10.01. Dissolution of the Issuer.
(a) The Issuer shall be dissolved, wound up and terminated as
provided herein upon the Note Trustee's determination, in its sole
discretion after consultation with such counsel and other experts as it
deems necessary, that the Issuer is insolvent; provided that such
determination shall be made without regard to any fees or expenses
imposed on or otherwise owed by the Issuer to any of the Issuer
Trustee, the Note Trustee and the Issuer Certificate Agent. Upon any
such determination, the Note Trustee shall have the right, in its sole
discretion, to (i) apply for or consent to the appointment of, or the
taking of possession by, a receiver, custodian, examiner or liquidator
of the Issuer or of all or a substantial part of the Issuer Estate,
(ii) make a general
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assignment for the benefit of the Issuer's creditors, (iii) file a
petition seeking to take advantage of any other law relating to
bankruptcy, insolvency, reorganization, liquidation, dissolution,
arrangement or winding-up, or composition or readjustment of debts,
(iv) take any corporate action for the purpose of effecting any of the
foregoing or (v) do the equivalent of any of the foregoing under the
laws of the United States (each action described in (i) through (v), a
"Bankruptcy Action"), each with respect to the Issuer upon 90 days'
prior written notice to the Certificateholders and the Depositor.
Neither the Depositor nor any Certificateholder shall have any right to
direct the taking of a Bankruptcy Action with respect to the Issuer;
provided, however, the Certificateholders shall have the right to
liquidate the assets of the Issuer on a date that is at least one year
and one day after receiving a certificate from the Note Trustee that
all of the obligations under the Indenture have been satisfied and
discharged in full. With respect to any determination of insolvency by
the Note Trustee under this Section 10.01(a), the Note Trustee shall
incur no personal liability to any Person for any determination (action
or inaction in connection therewith) made in good faith, and in acting
(or not in acting as the case may be) under this Section, the Note
Trustee shall owe no fiduciary duties to any Person other than the
Noteholders. In connection with the Note Trustee's determination that
the Issuer is insolvent, the Note Trustee shall not be obligated to
follow the instructions of the Certificateholders and shall have no
liability to the Issuer or any other Person for its failure to do so.
(b) Upon dissolution of the Issuer, the Issuer shall be wound
up in accordance with Section 3808 of the Act.
Section 10.02. Termination.
The Issuer shall terminate when all of the Issuer's assets shall have
been disposed of and distributed as provided herein. Upon the winding up of the
Issuer and its termination, the Issuer Trustee shall cause the Certificate of
Trust to be canceled by filing a certificate of cancellation with the Secretary
of State in accordance with the provisions of Section 3810 of the Act. Upon such
termination, all Class R Certificates shall be canceled.
ARTICLE XI:
NOTICES
Section 11.01. Notices.
Except as otherwise expressly provided herein in any particular case,
all notices, approvals, consents, requests and other communications hereunder
shall be in writing and shall, if addressed as provided in the following
sentence, be deemed to have been given, (i) when delivered by hand, (ii) one
Business Day after being sent by a private nationally or internationally
recognized overnight courier service, or (iii) when sent by telecopy, if
immediately after transmission the sender's facsimile machine records in writing
the correct answer back. Actual receipt at the address of an addressee,
regardless of whether in compliance with the foregoing is effective notice
hereunder. Until otherwise so notified by the respective parties, all notices,
approvals, consents, requests and other communications shall be addressed to the
following addressees:
If to the Depositor:
Fund America Investors Corporation II
c/o The Chotin Group
Agreement of Trust
▇▇
▇▇
▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇'▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇. ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Telephone No.: ▇▇▇-▇▇▇-▇▇▇▇
Telecopy No.: ▇▇▇-▇▇▇-▇▇▇▇
If to the Issuer Trustee or the Issuer:
Christiana Bank & Trust Company
Greenville Center
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Corporate Trust Administration
Telephone No.: ▇▇▇-▇▇▇-▇▇▇▇
Telecopy No.: ▇▇▇-▇▇▇-▇▇▇▇
If to the Issuer Certificate Agent:
If by courier:
State Street Bank and Trust Company
Global Investor Services Group - Corporate Trust
▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇▇▇ - ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: FAIC II Issuer Trust 2000-1
Telephone No.: ▇▇▇-▇▇▇-▇▇▇▇
Telecopy No.: ▇▇▇-▇▇▇-▇▇▇▇
or, if by U.S. mail:
State Street Bank and Trust Company
Global Investor Services Group - Corporate Trust
▇.▇. ▇▇▇ ▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: FAIC II Issuer Trust 2000-1
Telephone No.: ▇▇▇-▇▇▇-▇▇▇▇
Telecopy No.: ▇▇▇-▇▇▇-▇▇▇▇
If to the Certificateholders:
To the Certificateholders identified as such in the
Certificate Register.
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ARTICLE XII:
MISCELLANEOUS PROVISIONS
Section 12.01. Entire Agreement.
Each of the parties hereto represents and warrants to the others that
this Agreement, when considered together with the other Transaction Documents,
constitutes the entire agreement among the parties hereto relating to the
transactions contemplated hereby.
Section 12.02. Governing Law; Submission to Jurisdiction.
THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH
THE LAWS OF THE STATE OF DELAWARE APPLICABLE TO AGREEMENTS MADE AND TO BE
PERFORMED THEREIN WITHOUT REGARD TO THE CONFLICT OF LAWS OR CHOICE OF LAW
PRINCIPLES THEREOF. The parties hereto hereby submit to the non-exclusive
jurisdiction of the United States District Court for the Southern District of
New York and of the Supreme Court of the State of New York sitting in New York
County (including its Appellate Division), and of any other appellate court in
the State of New York, for the purposes of all legal proceedings arising out of
or relating to this Agreement or the transactions contemplated hereby. The
parties hereto hereby irrevocably waive, to the fullest extent permitted by
applicable law, any objection that they may now or hereafter have to the laying
of the venue of any such proceeding brought in such a court and any claim that
any such proceeding brought in such a court has been brought in an inconvenient
forum.
Section 12.03. Effect.
Except as otherwise specified herein, this Agreement shall be binding
upon and inure to the benefit of the parties and their respective legal
representatives, successors and permitted assigns.
Section 12.04. Pronouns and Number.
Wherever from the context it appears appropriate, each term stated in
either the singular or the plural shall include the singular and the plural, and
pronouns stated in either the masculine, feminine or neuter shall include the
masculine, feminine and neuter.
Section 12.05. Effect of Headings.
The Table of Contents and the headings of the Articles, Sections,
subsections, clauses and paragraphs hereof, and of Exhibits hereto, are for
convenience of reference only, and shall not affect the construction or
interpretation of this Agreement.
Section 12.06. Severability of Provisions.
If any provision hereof shall be held invalid or unenforceable by any
court of competent jurisdiction, such holding shall not invalidate or render
unenforceable any other provision hereof. To the extent permitted by applicable
law, the parties hereto hereby agree that any provision hereof that renders any
other term or provision hereof invalid or unenforceable in any respect shall be
modified, but only to the extent necessary to avoid rendering such other term or
provision invalid or unenforceable, and such modification shall be accomplished
in the manner that most nearly preserves the benefit of all the parties' bargain
hereunder.
Agreement of Trust
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Section 12.07. Amendment or Waiver; Effect on Issuer Trust Agreement.
Any provision of this Agreement may be amended or waived by an
amendment or waiver which is in writing and signed by the Depositor and the
Issuer Certificate Agent; provided, that the Issuer Certificate Agent shall
consent to any amendment or waiver only upon written instruction by the Majority
Certificateholders (which shall constitute the Majority Certificateholders'
consent to the amendment); provided, further, that, to the extent that such
amendment materially affects the interests of the Issuer Trustee, such amendment
shall require the consent of the Issuer Trustee; provided, further, that without
the consent of 100% of the Holders at the time, no such amendment or waiver or
any amendment or waiver to any other Transaction Document to which the Issuer is
a party shall (1) alter or amend the right of the Holders to receive payments
thereon, or institute suit in respect thereof, (2) release any portion of the
Issuer Estate or any portion of the assets of the Issuer, or (3) reduce any
amount required to be collected or retained by the Issuer or the Issuer Trustee;
and provided, further, that no such amendment or waiver shall be executed if
otherwise prohibited by the Indenture or other Transaction Documents.
Promptly after the execution by all required parties of any such
amendment to, or waiver of, this Agreement, the Issuer Certificate Agent shall
furnish a copy of any such amendment or waiver to the Issuer Trustee, each
Certificateholder and the Depositor.
Section 12.08. Binding Upon Assigns.
Except as otherwise provided herein, the provisions of this Agreement
(including any amendments, modification and waivers hereof properly adopted)
shall be binding upon and shall inure to the benefit of the parties hereto and
their respective successors and assigns.
Section 12.09. Counterparts.
This Agreement may be executed in any number of counterparts, each of
which shall be deemed to be an original, but all such counterparts shall
together constitute but one and the same instrument.
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IN WITNESS WHEREOF, the undersigned have executed this
Agreement as of the date above first written.
CHRISTIANA BANK & TRUST COMPANY, as Issuer
Trustee
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇▇.
-------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇▇.
Title: Vice President
FUND AMERICA INVESTORS CORPORATION II,
as Depositor
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
-------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Vice President
STATE STREET BANK AND TRUST COMPANY as
Issuer Certificate Agent
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇
-------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Assistant Vice President
Agreement of Trust
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SCHEDULE I
AGENCY SECURITIES
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EXHIBIT A
FORM OF CLASS R CERTIFICATE
THIS CLASS R CERTIFICATE HAS NOT BEEN AND WILL NOT BE REGISTERED OR
QUALIFIED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"),
OR THE SECURITIES LAWS OF ANY STATE AND MAY NOT BE RESOLD OR OTHERWISE
TRANSFERRED UNLESS IT IS REGISTERED PURSUANT TO THE SECURITIES ACT AND
REGISTERED OR QUALIFIED UNDER APPLICABLE STATE LAW OR IS RESOLD OR OTHERWISE
TRANSFERRED IN TRANSACTIONS WHICH ARE EXEMPT FROM REGISTRATION UNDER THE
SECURITIES ACT AND UNDER APPLICABLE STATE LAW.
THIS CLASS R CERTIFICATE MAY ONLY BE RESOLD OR OTHERWISE TRANSFERRED
(A) TO A QUALIFIED INSTITUTIONAL BUYER (AS DEFINED IN RULE 144A) PURCHASING FOR
ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER OR (B) TO
CERTAIN OTHER INSTITUTIONAL "ACCREDITED INVESTORS" (AS DEFINED IN RULE
501(A)(1), (2), (3) OR (7) UNDER THE SECURITIES ACT), AND IN ACCORDANCE WITH
SECTION 4.05 OF THE ISSUER TRUST AGREEMENT (AS DEFINED HEREIN).
NO TRANSFER OF THIS CLASS R CERTIFICATE SHALL BE MADE UNLESS (I) THE
ISSUER CERTIFICATE AGENT SHALL HAVE RECEIVED FROM THE TRANSFEREE A TRANSFEREE
CERTIFICATE AND (II) SUCH TRANSFER IS EXEMPT FROM THE REGISTRATION REQUIREMENTS
UNDER THE SECURITIES ACT AND ANY APPLICABLE STATE SECURITIES LAWS. IN THE EVENT
THAT A TRANSFER OF A CLASS R CERTIFICATE IS TO BE MADE, THE ISSUER CERTIFICATE
AGENT MAY REQUIRE AN OPINION OF COUNSEL ACCEPTABLE TO AND 1N FORM AND SUBSTANCE
SATISFACTORY TO THE REQUESTING PARTY, TO THE EFFECT THAT SUCH TRANSFER MAY BE
MADE PURSUANT TO AN EXEMPTION, DESCRIBING THE APPLICABLE EXEMPTION AND THE BASIS
THEREFOR, FROM THE SECURITIES ACT AND IS BEING MADE IN ACCORDANCE WITH THE
INVESTMENT COMPANY ACT OF 1940, AS AMENDED, WHICH OPINION OF COUNSEL SHALL NOT
BE AN EXPENSE OF THE ISSUER CERTIFICATE AGENT OR THE ISSUER. THE
CERTIFICATEHOLDER SHALL BE DEEMED BY ITS ACCEPTANCE AND HOLDING OF THIS CLASS R
CERTIFICATE TO AGREE THAT NEITHER THE ISSUER NOR THE ISSUER CERTIFICATE AGENT IS
UNDER AN OBLIGATION TO OR INTENDS TO REGISTER THIS CLASS R CERTIFICATE UNDER THE
SECURITIES ACT OR ANY OTHER SECURITIES LAW.
No transfer of this Class R Certificate shall be made unless and until
the prospective transferee provides the Certificate Registrar (as defined in the
Issuer Trust Agreement described below) with an affidavit, in the form of
paragraph 7 of the Transferee Certificate (as defined in the Issuer Trust
Agreement described below), to the effect that such transferee is not an
employee benefit plan that is subject to all or a portion of Title I of the
Employee Retirement Income Security Act of 1974, as amended ("ERISA"), or any
retirement plan or arrangement that is subject to Section 4975 of the Code, nor
a person acting, directly or indirectly, on behalf of any such employee benefit
plan, plan or arrangement (including an insurance company using funds in its
general account that may constitute "plan assets") (each, a "Plan") and is not a
governmental plan subject to any laws or regulations that are substantially
similar to Section 406 of ERISA or Section 4975 of the Code (as defined in the
Issuer Trust Agreement described below), or a person acting, directly or
indirectly, on behalf of any such government plan.
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A beneficial or record interest in a Class R Certificate may not be
sold or transferred to a Disqualified Organization (as defined in the Issuer
Trust Agreement described below). Any attempted or purported transfer of an
interest in a Class R Certificate shall be absolutely null and void and shall
vest no rights in the purported transferee unless (a) such transferee provides
to the Certificate Registrar, who shall be responsible for forwarding it to
▇▇▇▇▇▇ ▇▇▇ and ▇▇▇▇▇▇▇ Mac, (i) affidavits, in the forms provided as,
respectively, Exhibits C-1 and C-2 to the Issuer Trust Agreement (the
"Transferee Affidavits"), each to the effect that such prospective transferee is
(i) not a "disqualified organization" as defined in such Underlying Documents
(as defined in the Issuer Trust Agreement described below) and is not purchasing
such Class R Certificate on behalf of a disqualified organization and (ii) a
U.S. Person and (iii) if requested by the Certificate Registrar, an opinion of
counsel (in a form acceptable to the Certificate Registrar) that the proposed
transfer will not cause such interest to be held by or on behalf of a
disqualified organization. Such transferee shall also provide a cover letter
addressed to the Issuer Trustee, the Authenticating Agent (as defined in the
Issuer Trust Agreement described below) and the Certificate Registrar to the
effect that the addressees of such letter may rely on the certifications made by
such transferee in the Transferee Affidavits. In the event that the Class R
Certificates shall be optionally redeemed, the Seller, as assignee of the
Depositor's right to cause the redemption of the Class R Certificates, and,
after such redemption the owner of 100% of the beneficial ownership interest in
the Issuer, shall be obligated to provide to the Certificate Registrar the
Transferee Affidavits, a Transferee Certificate in the form of Exhibit B to the
Issuer Trust Agreement, and if requested by the Certificate Registrar, an
opinion of counsel as described in this paragraph as if the Seller were the
prospective transferee for the purposes of this paragraph. The Certificate
Registrar shall be responsible for forwarding such documents to the ▇▇▇▇▇▇ Mae
or ▇▇▇▇▇▇▇ Mac.
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FAIC II ISSUER TRUST 2000-1
FAIC II ISSUER TRUST 2000-1, CLASS R CERTIFICATES
DUE DECEMBER 1, 2029
No. __
Cusip No. _____________ U.S.$_______
FAIC II ISSUER TRUST 2000-1, a statutory business trust formed under
the laws of the State of Delaware (the "Issuer"), for value received, hereby
promises to pay to _________________________, or registered assigns, upon
presentation and surrender of this Class R Certificate (except as otherwise
permitted by the Issuer Trust Agreement referred to below), the principal sum of
_______________ ______________________ United States Dollars (U.S. $______) due
on December 1, 2029 (the "Final Scheduled Monthly Payment Date"), all as
provided below and in the Issuer Trust Agreement referred to herein.
This Class R Certificate is issued pursuant to an Agreement of Trust,
dated as of January 20, 2000 (the "Issuer Trust Agreement"), among Fund America
Investors Corporation II, as depositor, Christiana Bank & Trust Company, as
issuer trustee, and State Street Bank and Trust Company, as issuer certificate
agent.
The obligations of the Issuer under this Class R Certificate and the
Issuer Trust Agreement are obligations solely of the Issuer. This Class R
Certificate does not represent an obligation of, or an interest in, the Issuer
Trustee or any of its affiliates and no recourse may be had against the Issuer
Trustee or its assets, except as may be expressly set forth or contemplated
herein or in the Issuer Trust Agreement. The Class R Certificates represent the
undivided beneficial interest in the assets of the Issuer, subject to the pledge
of the Pledged Assets (as defined in the Indenture) by the Issuer to the Note
Trustee pursuant to the Indenture for the benefit of the Noteholders.
Consequently, any rights of the Certificateholders to the Pledged Assets will be
subject to that pledge.
Distributions on the Class R Certificates will be payable on the first
Business Day of each month, commencing on March 1, 2000 (each, a "Monthly
Payment Date"), to holders of record of the Class R Certificates (the
"Certificateholders") as of the Record Date.
Capitalized terms used herein and not otherwise defined shall have the
meanings set forth in the Issuer Trust Agreement.
On each Monthly Payment Date, the Class R Certificates are entitled to
receive all payments of principal collected on the Series 2203 ▇▇▇▇▇▇▇ Mac
Security during the preceding Interest Accrual Period until the Outstanding
Certificate Balance of the Class R Certificates has been reduced to zero. On and
after the Monthly Payment Date on which all principal of and interest on the
Notes has been paid in full, all Residual Collections shall be distributed on
the Class R Certificates, less any amounts owed to the Note Trustee, Issuer
Trustee or Issuer Certificate Agent as reimbursed expenses or indemnity. All
distributions on the Class R Certificates shall be allocated pro rata among the
Class R Certificates first to reduce the Outstanding Certificate Balance of the
Class R Certificates to zero, and thereafter to be distributed on the Class R
Certificates as additional investment yield.
The Class R Certificates have no stated interest rate.
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The Class R Certificates will be redeemed in full on December 1, 2029
(the "Final Scheduled Monthly Payment Date") to the extent not repaid or
redeemed prior thereto.
The Depositor or its assignee may, by written demand to the Issuer
Certificate Agent and the Issuer Trustee, cause the Issuer to redeem on a
Monthly Payment Date all but not less than all of the Class R Certificates at a
price equal to 105% of the Outstanding Certificate Balance of the Class R
Certificates on such Monthly Payment Date (the "Optional Certificate Redemption
Amount"). Such demand shall be delivered at least 10 calendar days but no more
than 25 calendar days prior to the Monthly Payment Date on which the redemption
is to occur. Prior to any redemption of the Class R Certificates, the Optional
Certificate Redemption Amount shall be deposited into the Trust Agreement
Collection Account no later than the 9th calendar day prior to such Monthly
Payment Date selected for redemption of the Class R Certificates. Such
redemption shall occur on a Monthly Payment Date specified in the written
notice, which date shall be on or after the earlier of (A) March 1, 2005 and (B)
the first Monthly Payment Date on which the remaining balance of the Agency
Securities shall be equal to or less than 20% of the principal amount of the
Agency Securities (at original issuance), after giving effect to any principal
payments on such Monthly Payment Date (the "Permitted Certificate Redemption
Date"). Upon redemption of the Class R Certificates, the party who effected the
redemption by depositing the Optional Certificate Redemption Amount shall own
the entire beneficial ownership interest in the Issuer until the Notes are
redeemed or paid in full and the Issuer is terminated, and such party shall have
the right to direct redemption of the Notes pursuant to the Indenture. Such
party's ownership interest in the Issuer shall be subject to the same ownership
and transfer restrictions as the Class R Certificates, which are set forth in
Section 4.05 of the Issuer Trust Agreement.
The holders of the Class R Certificates may direct the Issuer to redeem
all but not less than all of the Notes at a price equal to 100% of the
Outstanding Principal Amount of the Notes (the "Optional Note Redemption
Amount") on any Monthly Payment Date on or after the earlier of (A) June 1, 2005
and (B) the first Monthly Payment Date on which the remaining balance of the
Agency Securities shall be equal to or less than 20% of the principal amount of
the Agency Securities (at original issuance), after giving effect to any
principal payments on such Payment Date (any such date, a "Permitted Note
Redemption Date"); provided that if the Seller as assignee of the Depositor, has
caused the Issuer to redeem the Class R Certificates or has delivered a written
demand to the Issuer Certificate Agent for the optional redemption of the Class
R Certificates to occur on the upcoming Monthly Payment Date then the Seller,
and not the holders of the Class R Certificates, shall have the right to cause
the Notes to be redeemed. In order for a redemption of the Notes to occur on a
particular Monthly Payment Date, (i) the Issuer Trustee shall have delivered to
the Note Trustee a written demand for such redemption at least 10 days but no
greater than 25 days prior to the Monthly Payment Date selected for such
redemption, and (ii) the Optional Note Redemption Amount shall have been
deposited into the Note Collection Account no later than the 9th calendar day
prior to such Monthly Payment Date.
The Internal Revenue Service has proposed regulations requiring certain
reporting by trustees to holders of "widely held fixed investment trusts." To
avoid the expense of any reporting, by acquiring this Class R Certificate,
whether on original issue or in a secondary purchase, the registered holder of
this Certificate agrees as follows:
(i) The Certificateholder shall hold this Class R Certificate
directly and not through a "middleman." For this purpose, a "middleman"
is any person who holds an interest on behalf of, or for the account
of, another person, or who otherwise acts in a capacity as an
intermediary for the account of another person, including, without
limitation, a custodian, such as a bank, financial institution or
brokerage firm; a nominee, including the joint owner of an account,
except if the joint owners are husband and wife; or a broker holding an
interest for a customer in street name.
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(ii) If Proposed Treasury Regulations Section 1.671-4(j) shall
become final in a form which permits this Certificateholder to request
quarterly information, the Certificateholder agrees that it shall
request such information only upon making provision of compensation to
the Issuer Certificate Agent for the expenses of providing such
information.
(iii) The Certificateholder agrees not to transfer this Class
R Certificate to any person unless such person agrees to these
provisions in writing for the benefit of the Issuer.
The Issuer Certificate Agent will send each payment on a Monthly
Payment Date to each Class R Certificateholder, together with a statement
setting forth, among other things, (i) the amount of such payment allocable to
principal and (ii) the amount of such payment allocable to investment yield.
Such amounts will be expressed as a dollar amount per U.S. $1,000 of the
original principal amount of the Class R Certificates.
Unless the certificate of authentication hereon has been executed by
the Authenticating Agent by the manual signature of one of its Authorized
Officers, this Class R Certificate shall not be entitled to any benefit under
the Issuer Trust Agreement or be valid or obligatory for any purpose.
If a Certificate Termination Event with respect to the Class R
Certificates occurs and is continuing, the Issuer Certificate Agent at the
direction of the Majority Certificateholders will cause the Issuer to be
dissolved and terminated, or, upon the occurrence of the Certificate Termination
Event described in Section 6.01(e) of the Issuer Trust Agreement, the Issuer
Certificate Agent shall cause the Issuer to be terminated without any notice
from Certificateholders. Upon any such termination, subject to the requirements
of Section 3808 of the Act, all of the property of the Issuer (other than
amounts in the Expense Reserve Account) will be distributed by the Issuer
Certificate Agent pro rata to the Certificateholders.
Title to this Class R Certificate shall pass by registration in the
Certificate Register kept at the Corporate Trust Office by the Certificate
Registrar.
No service charge shall be made for exchange or registration of
transfer of this Class R Certificate, but the Issuer may require payment of a
sum sufficient to cover any tax or other governmental charge payable in
connection therewith.
The recitals contained herein shall be taken as statements of the
Depositor and the Issuer Trustee assumes no responsibility for the correctness
thereof. The Issuer Trustee makes no representations as to the validity or
sufficiency of this Class R Certificate or of any of the assets of the Issuer or
related documents.
THIS CLASS R CERTIFICATE SHALL BE CONSTRUED IN ACCORDANCE WITH, AND
GOVERNED BY, THE LAWS OF THE STATE OF DELAWARE APPLICABLE TO AGREEMENTS MADE AND
TO BE PERFORMED THEREIN WITHOUT REGARD TO THE CONFLICT OF LAWS OR CHOICE OF LAW
PRINCIPLES THEREOF.
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IN WITNESS WHEREOF, the Issuer has caused this Class R
Certificate to be duly executed.
Dated _____________
FAIC II ISSUER TRUST 2000-1
By: CHRISTIANA BANK & TRUST COMPANY, as
Issuer Trustee
By: ___________________________
Name:
Title:
CERTIFICATE OF AUTHENTICATION
This is one of the Class R Certificates referred to in the
within-mentioned Issuer Trust Agreement.
STATE STREET BANK AND TRUST COMPANY, as
Authenticating Agent
By:__________________________
Authorized Signatory
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ASSIGNMENT FORM
For value received
hereby sell, assign and transfer unto
Please insert social security or other identifying number of assignee
Please print or type name and address, including zip code, of assignee:
____________________________ the within Class R Certificate and does hereby
irrevocably constitute and appoint ________________________ Attorney to transfer
the Class R Certificate on the books of the Company with full power of
substitution in the premises.
Date: _________ Your Signature:_____________________
(Sign exactly as your name appears on this Class R Certificate)
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EXHIBIT B
FORM OF TRANSFEREE CERTIFICATE
COUNTY OF )
: SS.:
STATE OF )
[Name], being first duly sworn, deposes and says:
1. That [s/he] is the [title] of [transferee entity] proposed
transferee of [one of the] U.S. $324,992.88 aggregate principal amount of FAIC
II Issuer Trust 2000-1 Class R Certificates Due December 1, 2029, representing
100% of the equity interest of the Issuer (the "Transferee"), a statutory
business trust duly organized and existing under the laws of the State of
Delaware, on behalf of which he has the authority to make this affidavit and
agreement. The Class R Certificates were issued pursuant to the Agreement of
Trust dated as of January 20, 2000 (the "Issuer Trust Agreement") among Fund
America Investors Corporation II, Christiana Bank & Trust Company, a banking
corporation incorporated in the State of Delaware (in its individual capacity
solely where expressly set forth in the Issuer Trust Agreement, "Christiana
Bank"), otherwise acting solely in its capacity as trustee of the Issuer
thereunder (in such capacity, the "Issuer Trustee"), and State Street Bank and
Trust Company (in its individual capacity, "State Street"), as agent thereunder
with respect to the Class R Certificates issued thereunder (in such capacity,
the "Issuer Certificate Agent"). Unless otherwise defined herein, capitalized
terms used herein shall have the meanings assigned to such terms in the Issuer
Trust Agreement.
2. That the Transferee has reviewed the restrictions set forth
on the face of the Class R Certificates and the provisions of Article IV of the
Issuer Trust Agreement under which the Class R Certificates were issued. The
Transferee expressly agrees to be bound by and to comply with such restrictions
and provisions.
3. That the Transferee is a "U.S. Person," or a U.S. citizen
or resident, a corporation, partnership, or other entity created or organized
in, or under the laws of, the United States or any political subdivision
thereof, an estate whose income is subject to United States federal income tax
regardless of its source, or a trust if a U.S. court is able to exercise primary
supervision over the administration of the trust and one or more U.S. Persons
have the authority to control all substantial decisions of the trust.
4. That this affidavit and agreement relates only to the Class
R Certificates to be held by the Transferee and not to any other Holder of the
Class R Certificates.
5. That the Transferee, by accepting the Class R Certificates,
acknowledges, represents and agrees as follows:
(a) The Class R Certificates have not been registered under
the Securities Act of 1933, as amended (the "Securities Act"), or the
securities laws of any state of the United States and, until
registered, may not be offered, sold or otherwise transferred unless
exemptions from registration under the Securities Act and such
applicable state securities laws are available.
(b) The Transferee (a)(i) is a Qualified Institutional Buyer
and (ii) is acquiring the Class R Certificates for its own account or
for the account of a Qualified Institutional Buyer or (b)
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48
is an institution which is an institutional accredited investor
(meaning an "accredited investor" as defined in Rule 501 (a)(1), (2),
(3) or (7) of Regulation D under the Securities Act) who is not a
Qualified Institutional Buyer.
(c) The Transferee understands that transfers of the Class R
Certificates offered and sold to a Qualified Institutional Buyer or to
an institutional Accredited Investor will be registered only if the
Class R Certificates are transferred in accordance with the transfer
restrictions referred to in paragraph (b) above and an appropriate
transfer letter (copies of which are available from the Issuer
Certificate Agent) is delivered to the Issuer Certificate Agent
appropriately completed.
(d) The Transferee understands that the Class R Certificates
offered and sold to Qualified Institutional Buyer or to an
institutional Accredited Investor shall bear a legend to the following
effect:
"THIS CLASS R CERTIFICATE HAS NOT BEEN AND WILL NOT
BE REGISTERED OR QUALIFIED UNDER THE SECURITIES ACT OF 1933,
AS AMENDED (THE "SECURITIES ACT"), OR THE SECURITIES LAWS OF
ANY STATE AND MAY NOT BE RESOLD OR OTHERWISE TRANSFERRED
UNLESS IT IS REGISTERED PURSUANT TO THE SECURITIES ACT AND
REGISTERED OR QUALIFIED UNDER APPLICABLE STATE LAW OR IS
RESOLD OR OTHERWISE TRANSFERRED IN TRANSACTIONS WHICH ARE
EXEMPT FROM REGISTRATION UNDER THE SECURITIES ACT AND UNDER
APPLICABLE STATE LAW. THIS CERTIFICATE MAY ONLY BE RESOLD OR
OTHERWISE TRANSFERRED (A) TO A QUALIFIED INSTITUTIONAL BUYER
(AS DEFINED IN RULE 144A) PURCHASING FOR ITS OWN ACCOUNT OR
FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER OR (B) TO
CERTAIN OTHER INSTITUTIONAL "ACCREDITED INVESTORS" (AS DEFINED
IN RULE 501 (A)(1), (2), (3) OR (7) UNDER THE SECURITIES ACT),
AND IN ACCORDANCE WITH SECTION 4.05 OF THE ISSUER TRUST
AGREEMENT (AS DEFINED HEREIN)."
6. That the Transferee is acquiring the Certificate for its
own account for investment and not with a view to or for sale or transfer in
connection with any distribution thereof, in whole or in part, in any manner
which would violate the Securities Act, or any applicable State securities laws.
7. That the Transferee is not an employee benefit plan that is
subject to all or a portion of Title I of the Employee Retirement Income
Security Act of 1974, as amended ("ERISA"), or any retirement plan or
arrangement that is subject to Section 4975 of the Code, nor a person acting,
directly or indirectly, on behalf of any such employee benefit plan, plan or
arrangement(including an insurance company using funds in its general account
that may constitute "plan assets") (each, a "Plan") and is not a governmental
plan subject to any laws or regulations that are substantially similar to
Section 406 of ERISA or Section 4975 of the Code, or a person acting, directly
or indirectly, on behalf of any such government plan.
8. That the Transferee agrees as follows:
(a) Such Transferee shall hold such Class R Certificates
directly and not through a "middleman." For this purpose, a "middleman"
is any person who holds an interest on behalf of, or for the account
of, another person, or who otherwise acts in a capacity as an
intermediary for the account of another person, including, without
limitation, a custodian, such as a bank, financial
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49
institution or brokerage firm; a nominee, including the joint owner of
an account, except if the joint owners are husband and wife; or a
broker holding an interest for a customer in street name.
(b) If Proposed Treasury Regulations Section 1.671-4(j) shall
become final in a form which permits such Transferee to request
quarterly information, such Transferee agrees that it shall request
such information only upon making provision of compensation to the
Issuer Certificate Agent for the expenses of providing such
information.
(c) Such Transferee agrees not to transfer such Class R
Certificates to any person unless such person agrees to these
provisions in writing for the benefit of the Issuer.
9. That the Transferee (i) is not a "disqualified
organization" as defined in Section 860E(e)(5) of the Internal Revenue Code of
1986, as amended, and will not be a disqualified organization as of [date of
transfer], (ii) is not acquiring the Class R Certificate for the account of a
disqualified organization, (iii) consents to any amendment of the Issuer Trust
Agreement that shall be deemed necessary by the Issuer (upon advice of counsel)
to constitute a reasonable arrangement to ensure that the Class R Certificate
will not be owned directly or indirectly by a disqualified organization, (iv)
does not have as a purpose for acquiring the Class R Certificate to avoid or
impede the assessment or collection of tax, (v) understands that it may incur
tax liabilities in excess of any cash flows generated by the Class R
Certificate, (vi) intends to pay taxes associated with holding the Class R
Certificate as they become due; and (vii) will not transfer such Class R
Certificate unless (a) it has received from the transferee an affidavit in
substantially the same form as this affidavit containing these same seven
representations and (b) as of the time of the transfer, it does not have actual
knowledge that such affidavit is false.
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EXHIBIT C-1
FORM OF TRANSFEREE AFFIDAVIT (TO ▇▇▇▇▇▇▇ MAC)
Date of Transfer: [________ __, ____]
Federal Home Loan Mortgage Corporation
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Ladies and Gentlemen:
We propose to acquire the Residual Classes of the Series1 of
▇▇▇▇▇▇▇ Mac's Multiclass REMIC Certificates listed on Schedule I hereto (the
"Residual Classes"). The Residual Classes are described in the related Offering
Circular Supplement.
1. We certify that (a) we are not a disqualified organization
and (b) we are not acquiring the Residual Classes on behalf of a disqualified
organization. For this purpose, the term "disqualified organization" means the
United States, any state or political subdivision thereof, any foreign
government, any international organization, any agency or instrumentality of any
of the foregoing (except for the Federal Home Loan Mortgage Corporation
("▇▇▇▇▇▇▇ Mac") or any entity treated as other than an instrumentality of the
foregoing for purposes of Section 168(h)(2)(D) of the Internal Revenue Code of
1986 (the "Code")), any organization (other than a cooperative described in
Section 521 of the Code) that is exempt from taxation under the Code (unless
such organization is subject to tax on its unrelated business taxable income)
and any organization that is described in Section 1381(a)(2)(C) of the Code. We
understand that any breach by us of this certification may cause us to be liable
for an excise tax imposed upon transfers to disqualified organizations.
2. We certify that (a) we have historically paid our debts as
they become due, (b) we intend, and believe that we will be able, to continue to
pay our debts as they become due in the future, (c) we understand that as
beneficial owner of the Residual Classes, we may incur tax liabilities in excess
of any cash flows generated by such Classes, and (d) we intend to pay any taxes
associated with holding the Residual Classes as they become due.
3. We acknowledge that we will be the beneficial owner of the
Residual Classes shown on Schedule I hereto and the Residual Classes will be
either registered in our name or held in the name of our nominee (which is not a
disqualified organization), as indicated on Schedule I.
4. Unless ▇▇▇▇▇▇▇ Mac has consented to a transfer to a
transferee that is not a U.S. person by executing a consent in a form
satisfactory to ▇▇▇▇▇▇▇ Mac, we certify that we are a U.S. Person. For this
purpose, the term "U.S. Person" means a citizen or resident of the United
States, a corporation, partnership or other entity created or organized in or
under the laws of the United States or any State (other than a partnership that
is not treated as a U.S. Person under any applicable Treasury regulations), an
estate whose income is subject to United States federal income tax regardless of
its source, or a trust if a court within the United States is able to exercise
primary supervision over the administration of the trust and one or more U.S.
Persons have the authority to control all substantial decisions of the trust. We
agree that any breach by us of this certification shall render the transfer of
any interest in the Residual Classes to us absolutely null and void and shall
cause no rights in such Residual Classes to vest in us.
-----------------------
(1) A separate transferee affidavit will be executed for each Residual Class.
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5. We agree that in the event that at some future time we wish
to transfer an interest in a Residual Class, we will transfer such interest in a
Residual Class only (a) to a transferee that (i) is not a disqualified
organization and is not purchasing such interest in a Residual Class on behalf
of a disqualified organization, (ii) is a U.S. Person and (iii) has delivered to
▇▇▇▇▇▇▇ Mac a letter in the form of this letter and, if requested by ▇▇▇▇▇▇▇
Mac, an opinion of counsel (in form acceptable to ▇▇▇▇▇▇▇ Mac) that the proposed
transfer will not cause the interest in a Residual Class to be held by a
disqualified organization or a person who is not a U.S. Person or (b) with the
written consent of ▇▇▇▇▇▇▇ Mac.
6. We hereby designate ▇▇▇▇▇▇▇ Mac as our fiduciary to act as
the tax matters person for each REMIC Pool in which the Residual Classes
represent an interest.
Very truly yours,
[INSERT TRANSFEREE]
By:_________________________________________________________
Name:
Title:
Date:
Taxpayer Identification Number:[ ]
Address for Receipt of Tax
Information (Schedule Qs):
Name: [ ]
Attn: [ ]
Address:[ ]
[ ]
City: [ ]
State: [ ]
Zip: [ ]
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Under penalties of perjury, I declare that I am an authorized signatory
of the above Transferee and I am duly authorized to act on behalf of the
Transferee, and to the best of my knowledge and belief, the statements in
paragraphs 1, 2, 3 and 4 (excluding the last sentence thereof) of this
Transferee's Letter are true.
__________________________________________________By:
Name:
Title:
Date: [_________ __, ____]
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SCHEDULE I
(to Transferee's Letter dated _________ __, ____)
Series Class Name and Capacity*
------ ----- -----------------
2114 R [C]
2137 R [C]
2149 R [C]
-----------------------
* Indicate whether the "name" in which the security is held is an
individual ("I"), corporation ("C"), fiduciary ("F"), partnership ("P"), exempt
organization("EO") or nominee/custodian ("N").
54
EXHIBIT C-2
FORM OF TRANSFEREE AFFIDAVIT (TO ▇▇▇▇▇▇ ▇▇▇)
Affidavit pursuant to (i)
Section 860E(e)(4) of the
Internal Revenue Code of
1986, as amended, and (ii)
certain provisions of the
Trust Agreement (or, if
applicable, the Issue
Supplement) relating to
▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇ Trust
1999-[___](1)
STATE OF )
) ss:
COUNTY OF )
[NAME OF OFFICER], being first duly sworn, deposes and says
under penalties of perjury:
1. That he is [Title of Officer] of [Name of Investor] (the
"Investor") a [savings institution] [corporation] duly organized and existing
under the laws of [the State of ___________] [the United States], on behalf of
which he makes this affidavit.
2. That (i) the Investor is not a "disqualified organization"
as defined in Section 860E(e)(5) of the Internal Revenue Code of 1986, as
amended, and will not be a disqualified organization as of [date of transfer],
(ii) it is not acquiring the Class [__]-R REMIC Certificate for the account of a
disqualified organization, (iii) it consents to any amendment of the Trust
Agreement (or, if applicable, the Issue Supplement) that shall be deemed
necessary by ▇▇▇▇▇▇ ▇▇▇ (upon advice of counsel) to constitute a reasonable
arrangement to ensure that the Class [__]-R REMIC Certificate will not be owned
directly or indirectly by a disqualified organization, (iv) no purpose of the
acquisition of the Class [__]-R REMIC Certificate is to avoid or impede the
assessment or collection of tax; (v) it understands that it may incur tax
liabilities in excess of any cash flows generated by the Class [__]-R REMIC
Certificate; (vi) it intends to pay taxes associated with holding the Class
[__]-R REMIC Certificate as they become due; and (vii) it will not transfer such
Class [__]-R REMIC Certificate unless (a) it has received from the transferee an
affidavit in substantially the same form as this affidavit containing these same
seven representations and (b) as of the time of the transfer, it does not have
actual knowledge that such affidavit is false.
(1) A separate transferee affidavit will be executed for each residual security.
55
IN WITNESS WHEREOF, the Investor has caused this instrument to be
executed on its behalf, pursuant to the authority of its Board of Directors, by
its [Title of Officer] and its corporate seal to be hereunto attached, attested
by its [Assistant] Secretary, this ____ day of __________, [year].
[NAME OF INVESTOR]
By:
-----------------------
[Name of Officer]
[Title of Officer]
[Address of Investor for
receipt of distributions]
[Taxpayer I.D. number]
Address of Investor for receipt of
tax information:
----------------------------------
----------------------------------
[Corporate Seal]
Attest:
-----------------------
[Assistant] Secretary
Personally appeared before me the above-named [Name
of Officer], known or proved to me to be the same person who executed the
foregoing instrument and to be the [Title of Officer] of the Investor, and
acknowledged to me that he executed the same as his free act and deed and the
free act and deed of the Investor.
Subscribed and sworn before me this ____ day of __________, [year].
-----------------------
Notary Public
COUNTY OF ________________________
STATE OF _________________________
My commission expires on the _____________________.
2