Exhibit 4.2
STANDBY BOND PURCHASE AGREEMENT
dated as of
between
, AS TRUSTEE,
and
FGIC SECURITIES PURCHASE, INC.
[Must include Joinder of Tender Agent if different than Trustee]
TABLE OF CONTENTS*
Page
ARTICLE I
DEFINITIONS
SECTION 1.01. Definitions............................................................................2
SECTION 1.02. Incorporation of Certain Definitions by Reference......................................5
ARTICLE II
COMMITMENT TO PURCHASE VARIABLE RATE BONDS
SECTION 2.01. Commitment to Purchase Variable Rate Bonds.............................................5
SECTION 2.02. Method of Purchasing...................................................................5
SECTION 2.03. Termination of Commitment..............................................................6
SECTION 2.04. Sale of Variable Rate Bonds............................................................6
SECTION 2.05. Reduction of Available Commitment......................................................7
ARTICLE III
CONDITIONS
SECTION 3.01. Conditions to Effectiveness............................................................7
SECTION 3.02. Conditions to Purchase.................................................................8
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
SECTION 4.01. Existence..............................................................................8
SECTION 4.02. Authorization..........................................................................8
SECTION 4.03. Corporation Existence..................................................................8
SECTION 4.04. Authorization; Binding Effect..........................................................9
SECTION 4.05. Contravention; No Default..............................................................9
SECTION 4.06. Litigation.............................................................................9
ARTICLE V
COVENANTS
SECTION 5.01. No Amendment of GE Capital Agreement Without Consent of Issuer and Trustee.............9
SECTION 5.02. Other Liquidity Facilities.............................................................9
ARTICLE VI
DEFAULTS
SECTION 6.01. Events of Default.....................................................................10
ARTICLE VII
MISCELLANEOUS
SECTION 7.01. Notices...............................................................................11
SECTION 7.02. No Waivers............................................................................11
SECTION 7.03. Amendments and Waivers................................................................11
SECTION 7.04. Successors and Assigns................................................................11
SECTION 7.05. Term of this Agreement................................................................12
SECTION 7.06. New York Law..........................................................................12
SECTION 7.07. Counterparts..........................................................................12
SECTION 7.08. Trustee May Act through Agents and Appoint Co-Trustees................................12
SECTION 7.09. Beneficiaries.........................................................................12
SECTION 7.10. Capacity of Trustee...................................................................13
Exhibit 1 - Notice of Purchase
Exhibit 2 - Termination Notice
Exhibit 3 - Notice Addresses
STANDBY BOND PURCHASE AGREEMENT
STANDBY BOND PURCHASE AGREEMENT (the "Agreement") dated as of _______
between ______________, a banking corporation, as Trustee (the "Trustee") and
FGIC SECURITIES PURCHASE, INC., a Delaware corporation (the "Corporation").
WHEREAS, the ___________ (the "Issuer") has issued $__________
principal amount of its ______________ (herein called the "Variable Rate
Bonds") pursuant to an ________ dated as of _________ (the "Indenture" or the
"Authorizing Document"), between the Issuer and the Trustee (as in effect on
the date hereof);
WHEREAS, the Authorizing Document provides that the holders of the
Variable Rate Bonds shall have the option, upon the satisfaction of certain
conditions, to tender Variable Rate Bonds to the Tender Agent for purchase,
upon notice to the Tender Agent as provided for in the Authorizing Document
and, under certain circumstances, may be required to tender their Variable Rate
Bonds for purchase thereof in accordance with the terms of the Authorizing
Document; and
WHEREAS, the Corporation has agreed to purchase such tendered
Variable Rate Bonds pursuant to the terms of this Agreement, as consideration
for (i) the Corporation's status under the Authorizing Document as a Bondholder
of such purchased tendered Variable Rate Bonds entitled to the payments as a
general obligation of the Issuer of principal, interest (at the [Provider Rate]
prescribed herein), and the fees and expenses described therein, (ii) the
Corporation's entitlement to exercise all rights and remedies afforded
Bondholders under the Authorizing Document;
NOW, THEREFORE, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS
SECTION 1.01. Definitions. The following terms, as used herein, have
the following meanings:
"Authorized Representative" means any official of the Trustee or its
agents and of the Tender Agent, duly authorized and empowered to execute and
deliver this Agreement and all certificates or other documents connected
herewith or in connection with the issuance, sale and subsequent disposition of
the Variable Rate Bonds.
"Available Commitment" as of any day means the sum of the Available
Principal Commitment and the Available Interest Commitment, in each case as of
such day.
"Available Interest Commitment" initially means $ _______________ ,
computed based upon the Available Principal Commitment at the Maximum Rate and
thereafter means such initial amount adjusted from time to time as follows: (a)
downward by an amount that bears the same proportion to such initial amount as
the amount of any reduction in the Available Principal Commitment pursuant to
the definition of "Available Principal Commitment" bears to the initial
Available Principal Commitment; and (b) upward by an amount that bears the same
proportion to such initial amount as the amount of any increase in the
Available Principal Commitment pursuant to the definition of "Available
Principal Commitment" bears to the initial Available Principal Commitment.
"Available Principal Commitment" initially means $ _________________
and thereafter means such initial amount adjusted from time to time as follows:
(a) downward by the amount of any termination or reduction of the Available
Principal Commitment pursuant to Section 2.03 or Section 2.05; (b) downward by
the principal amount of any Bonds purchased by the Corporation pursuant to
Section 2.02; and (c) upward by the principal amount of any Bonds theretofore
purchased by the Corporation pursuant to Section 2.02, which are delivered for
sale by the Corporation pursuant to Section 2.04(b).
"Business Day" has the meaning set forth in the Authorizing Document.
"Commitment" means the Available Commitment calculated without regard
to clauses (b) and (c) of the definition of Available Principal Commitment and
the effect thereof on the amount of the Available Interest Commitment.
"Default" means any condition or event which constitutes an Event of
Default or which, with the giving of notice or lapse of time or both, would,
unless cured or waived, become an Event of Default.
"Default Rate" means a rate of interest per annum equal to the Prime
Rate plus 3%, provided, however, that in no event shall the Default Rate exceed
the Maximum Rate.
"Effective Date" means the date of execution and delivery of this
Agreement.
"Event of Default" has the meaning set forth in Section 6.01.
"GE Capital" means General Electric Capital Corporation.
"GE Capital Agreement" means the Standby Loan Agreement, dated as of
, by and between the Corporation and GE Capital.
"Maximum Rate" means the lesser of 25% per annum or the maximum rate
permitted by applicable law.
"Moody's" means ▇▇▇▇▇'▇ Investors Service, Inc., and its successors.
"Notice of Purchase" has the meaning specified in Section 2.02.
"Person" means an individual, a corporation, a partnership, an
association, a trust or any other entity or organization, including a
government or political subdivision or an agency or instrumentality thereof.
"Prime Rate" means the rate of interest publicly announced by ▇▇▇▇▇▇
Guaranty Trust Company of New York from time to time as its Prime Rate.
"Prospectus Supplement" means the Prospectus Supplement relating to
this Agreement which supplements the Corporation's Prospectus dated the date
hereof included in the Corporation's Registration Statement on Form S-3 (File
No. 33-65928) and amendments thereto, filed with the Securities and Exchange
Commission.
"Prospectus Supplement Effective Date" means the date that the
Prospectus Supplement is filed with the Securities and Exchange Commission in
accordance with the Securities Act of 1933.
"Provider Rate" means the rate of interest per annum equal to the
Prime Rate plus 1%.
"Purchase Date" has the meaning set forth in Section 2.02(d).
"Purchase Period" means the period from the later of
__________________ and the Prospectus Supplement Effective Date to and
including the earlier of (i) the Scheduled Termination Date (or, if such date
is not a Business Day, the Business Day immediately succeeding such date), (ii)
the date on which all Variable Rate Bonds have been paid in full, redeemed,
defeased or converted to a Fixed Rate in accordance with the terms of such
Variable Rate Bonds, (iii) the date on which the Commitment is terminated
pursuant to Section 2.03 and (iv) the date on which this Agreement is
terminated in accordance with the applicable provisions of Article
______________________ of the Authorizing Document.
"Related Documents" means the Authorizing Document, the Variable Rate
Bonds, the Remarketing Agreement and all other agreements, documents,
certificates and instruments executed and delivered in connection with the
issuance, sale and delivery of the Variable Rate Bonds and the execution and
delivery of this Agreement.
"Remarketing Agent" means ________________ and its successors and
assigns under the Remarketing Agreement, including any substitute remarketing
agent appointed pursuant to such Remarketing Agreement.
"Remarketing Agreement" means the Remarketing Agreement dated as of
between the Issuer and the Remarketing Agent.
"Scheduled Termination Date" means _______________ from the Effective
Date or such later date to which the Corporation may in its sole discretion, at
the request of the Trustee, extend this Agreement.
"Standard & Poor's" means Standard & Poor's Ratings Services and its
successors.
"State" means the State of _____________.
"Tender Agent" means, initially, __________________ , and upon any
resignation or removal of such Tender Agent, any other entity thereafter
designated as such pursuant to the Authorizing Document, and its permitted
agents, fiduciary designees, successors and assigns.
"Termination Event" has the meaning set forth in Section 6.01.
"Termination Notice" has the meaning set forth in Section 2.03.
SECTION 1.02. Incorporation of Certain Definitions by Reference. Each
capitalized term used herein and not otherwise defined herein shall have the
meaning provided therefor in the Authorizing Document.
ARTICLE II
COMMITMENT TO PURCHASE VARIABLE RATE BONDS
SECTION 2.01. Commitment to Purchase Variable Rate Bonds. The
Corporation agrees, on the terms and conditions contained in this Agreement, to
purchase Variable Rate Bonds bearing interest at a variable rate that are
tendered to the Tender Agent from time to time pursuant to the Authorizing
Document during the Purchase Period at the Purchase Price. In accordance with
Section 2.3 of the GE Capital Agreement, such purchase shall be made from
Corporation moneys or moneys made available by GE Capital to the Corporation
under the GE Capital Agreement. The aggregate principal amount of the Variable
Rate Bonds purchased by the Corporation on any Purchase Date shall not exceed
the Available Principal Commitment on such date and the aggregate amount of the
Purchase Price comprising interest on Variable Rate Bonds purchased by the
Corporation on any Purchase Date shall not exceed the lesser of (1) the
Available Interest Commitment and (2) the actual amount of interest accrued and
unpaid on such Variable Rate Bonds to but excluding such date. The Corporation
agrees that in no event shall amounts paid by it in respect of the Purchase
Price be paid from funds or property of the Issuer. The parties hereto
acknowledge that the obligation of the Corporation hereunder to purchase
Variable Rate Bonds pursuant and subject to the terms and conditions of this
Agreement is irrevocable and that the Corporation shall become a Bondholder
under the Authorizing Document of each Variable Rate Bond purchased under this
Agreement and that the Corporation, as such Bondholder, shall be entitled, as
the holder of Provider Bonds bearing interest at the Provider Rate, to all
rights and remedies granted to Bondholders of Variable Rate Bonds under the
Authorizing Document. From and after the Effective Date, the obligation of the
Corporation to purchase Variable Rate Bonds pursuant to this Agreement shall
run to the benefit of those beneficiaries identified in Section 7.09.
SECTION 2.02. Method of Purchasing. (a) Pursuant to Section of the
Authorizing Document, the Trustee will give notice to the Corporation, the
Issuer and the Tender Agent of the principal amount of Variable Rate Bonds for
which it has arranged a remarketing. Pursuant to the Authorizing Document and
Section 2.02(b) herein below, the Tender Agent will give notice to the
Corporation if Variable Rate Bonds bearing interest at a Variable Rate are to
be purchased by the Corporation due to the unavailability of remarketing
proceeds for such purchase.
(b) If by 11:30 p.m. (New York City time) on any Business Day during
the Purchase Period the Corporation receives a notice of purchase from the
Tender Agent substantially in the form of Exhibit 1 hereto (any such notice to
be referred to as a "Notice of Purchase"), the Corporation will pay, unless it
determines that any applicable condition specified in Section 3.02 below is not
satisfied, not later than 2:30 p.m. (New York City time) on the Purchase Date
to the Tender Agent, in funds to be available as specified in such Notice of
Purchase, an amount equal to the aggregate Purchase Price.
(c) The Corporation shall not have any responsibility for, or incur
any liability in respect of, any act, or any failure to act, by the Tender
Agent which results in the failure of the Tender Agent (x) to credit the
appropriate account with funds made available by the Corporation pursuant to
this Section or (y) to effect the purchase for the account of the Corporation
of Variable Rate Bonds with such funds pursuant to this Section.
(d) The "Purchase Date" for any purchase of Variable Rate Bonds shall
be the date specified in the Notice of Purchase; provided that in no event
shall the Purchase Date be (i) on the same day the Notice of Purchase is
received if the Notice of Purchase is received by the Corporation later than
11:30 p.m. (New York City time) or (ii) after the last day of the Purchase
Period.
SECTION 2.03. Termination of Commitment. If at any time a Termination
Event shall have occurred and be continuing, the Corporation may deliver a
notice (a "Termination Notice") regarding the termination of the Commitment
substantially in the form of Exhibit 2 hereto to the Trustee, the Issuer, the
Remarketing Agent and the Tender Agent at the addresses set forth in Exhibit 3
hereto (or such other addresses as may be specified by such Persons for such
purpose in writing to the Corporation), and the Commitment shall terminate,
effective at the close of business on the [30th] day following the date of
receipt of such notice by the Trustee, or if such day is not a Business Day,
the next succeeding Business Day.
SECTION 2.04. Sale of Variable Rate Bonds. (a) Remarketing Notices.
Prior to 11:15 a.m. (New York City time) on any Business Day on which the
Corporation holds Variable Rate Bonds purchased pursuant to this Agreement, the
Remarketing Agent may deliver a notice (a "Remarketing Notice") to the
Corporation, the Trustee and the Issuer stating that it has located a purchaser
(the "Purchaser") for some or all of such Variable Rate Bonds and that such
Purchaser desires to purchase on such Business Day such Variable Rate Bonds at
the principal amount thereof plus accrued interest at the rate such Variable
Rate Bonds would have accrued interest had such bonds not been Provider Bonds.
(b) Sale of Purchased Variable Rate Bonds. Upon receipt of a
Remarketing Notice in accordance with subsection (a), the Corporation shall
direct the Tender Agent to deliver those Variable Rate Bonds held in the
account of the Corporation being remarketed by the Remarketing Agent against
payment for such Variable Rate Bonds in an amount equal to the principal amount
thereof plus interest accrued thereon at the Provider Rate.
(c) Right to Sell Bonds. The Corporation expressly reserves the right
to sell, at any time, Provider Bonds purchased by it pursuant to this Agreement
provided that any such purchaser acknowledges in writing that its purchase
pursuant to this Section 2.04(c) is subject to the provisions of Sections
2.04(a) and (b) hereof.
(d) Sale Without Recourse. Any sale of a Variable Rate Bond, or
portion thereof, pursuant to Section 2.04(c) and other than pursuant to a
remarketing shall be without recourse to the seller and without representation
or warranty of any kind except as may be required by law.
SECTION 2.05. Reduction of Available Commitment. Upon any redemption,
defeasance, repayment or other payment, or on the fifth day following
conversion to a Fixed Rate of all or any portion of the principal amount of the
Variable Rate Bonds, the aggregate Available Principal Commitment shall
automatically be terminated by an amount equal to the principal amount of the
Variable Rate Bonds so redeemed, defeased, repaid or otherwise paid or
converted, as the case may be.
ARTICLE III
CONDITIONS
SECTION 3.01. Conditions to Effectiveness. This Agreement shall not
become effective until each of the following conditions has been satisfied:
(a) receipt by the Corporation of an opinion of counsel for the
Trustee, dated the Effective Date, covering the matters represented or
warranted in Sections 4.01 and 4.02 hereof;
(b) receipt by the Trustee of an opinion of counsel for the
Corporation, dated the Effective Date, covering the matters represented or
warranted in Sections 4.03, 4.04, 4.05 and 4.06 hereof;
(c) reliance letters shall have been addressed and delivered to the
Corporation with respect to the legal opinions delivered in connection with the
execution of this Agreement and the Variable Rate Bonds;
(d) receipt by the Corporation of a certificate from an Authorized
Representative of the Trustee to the effect that as of the Effective Date, to
the Trustee's best knowledge no "event of default" exists under the Authorizing
Document nor does any event exist which might become an event of default with
the passage of time or giving of notice or both; and
(e) Financial Guaranty Insurance Company shall have issued a policy
of municipal bond insurance guaranteeing payment of the full amount of
principal of and interest on the Variable Rate Bonds in accordance with
Financial Guaranty's Commitment Letter dated ________________ , 199_ relating
to such policy.
On the Effective Date, the Corporation shall deliver its certificate
stating that this Agreement has become effective and that the conditions
precedent thereto have been satisfied.
SECTION 3.02. Conditions to Purchase. The obligation of the
Corporation to purchase Variable Rate Bonds hereunder on any Purchase Date is
subject to satisfaction of the following conditions:
(a) receipt by the Corporation of a Notice of Purchase as required by
Section 2.02;
(b) the fact that the Variable Rate Bonds to be so purchased are not
beneficially held (or held in certificated form) by or for the account of the
Issuer, any affiliate of the Issuer or any broker-dealer holding Variable Rate
Bonds pursuant to an arrangement with the Issuer; and
(c) to the extent Variable Rate Bonds are certificated, the Tender
Agent shall hold, in trust for the Corporation, Variable Rate Bonds purchased
by the Corporation hereunder; the Tender Agent shall register such Variable
Rate Bonds purchased by the Corporation in the name of the Corporation or in
such other name or names as the Corporation may direct.
The Corporation shall be obligated to purchase Variable Rate Bonds
with respect to which the condition set forth in clause (b) has been satisfied,
notwithstanding the fact that such condition has not been satisfied with
respect to all of the outstanding Variable Rate Bonds. The Corporation shall
notify the Trustee, the Tender Agent and the Issuer by telephone no later than
1:30 p.m. on any Purchase Date in the event any of the conditions set forth in
this Section are not met.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
The Trustee represents and warrants that, as of the date on
which this Agreement is executed:
SECTION 4.01. Existence. The Trustee is a validly existing banking
corporation, with full right and power to execute, deliver and perform its
obligations under this Agreement and each Related Document to which it is a
party.
SECTION 4.02. Authorization. This Agreement has been duly authorized,
executed and delivered by the Trustee.
The Corporation represents and warrants that, as of the date on which
this Agreement is executed:
SECTION 4.03. Corporation Existence. The Corporation has been duly
incorporated and is validly existing as a corporation in good standing under
the laws of the State of Delaware.
SECTION 4.04. Authorization; Binding Effect. This Agreement and the
GE Capital Agreement each has been duly executed and delivered by the
Corporation pursuant to due authorization and each of this Agreement and the GE
Capital Agreement constitutes a valid and binding agreement of the Corporation
enforceable against the Corporation in accordance with its terms, except as (x)
limited by insolvency, reorganization, receivership, conservatorship,
liquidation, moratorium or other similar laws affecting the enforcement of
creditors' rights generally as such laws would apply in the event of the
insolvency, reorganization, receivership, conservatorship or liquidation of, or
other similar occurrence with respect to, the Corporation or in the event of
any moratorium or similar occurrence affecting the Corporation and (y) limited
by equitable principles (regardless of whether the issue of enforceability is
considered in a proceeding in equity or at law).
SECTION 4.05. Contravention; No Default. The execution and delivery
by the Corporation of, and the performance by the Corporation of its
obligations under, this Agreement will not contravene any provision of
applicable law or the Certificate of Incorporation or By-laws, each as amended,
of the Corporation or any material agreement or other instrument binding upon
the Corporation, and no consent, approval or authorization of any governmental
body or agency (which has not been obtained) is required for the performance by
the Corporation of its obligations under this Agreement.
SECTION 4.06. Litigation. There is no action, suit or proceeding
pending against, or to the knowledge of the Corporation threatened against, the
Corporation before any court or arbitrator or any governmental body, agency or
official in which there is a reasonable possibility of an adverse decision
which could materially adversely affect the financial position or results of
operations of the Corporation or which in any manner draws into question the
validity or enforceability of this Agreement or the Corporation's ability to
perform under this Agreement.
ARTICLE V
COVENANTS
SECTION 5.01. No Amendment of GE Capital Agreement Without Consent of
Issuer and Trustee. Without the prior written consent of the Trustee and the
Issuer, the Corporation will not agree or consent to any amendment, supplement
or modification of the GE Capital Agreement, nor waive any provision thereof.
The Corporation hereby repeats, for the benefit of the Trustee and the Issuer
and the holders of the Variable Rate Bonds, the covenants set forth in Section
6.1 of the GE Capital Agreement, which covenants, as well as the related
defined terms contained therein, are hereby incorporated by reference with the
same effect as if each and every such covenant and defined term were set forth
herein in its entirety.
SECTION 5.02. Other Liquidity Facilities. The Corporation agrees not
to enter into another standby bond purchase agreement or other similar form of
liquidity facility in support of the tender feature of adjustable rate bonds,
unless such bonds are rated by both Moody's and Standard & Poor's in their
highest short-term and long-term rating categories after giving effect to such
other agreement or liquidity facility in support of the tender feature of
adjustable rate bonds.
ARTICLE VI
DEFAULTS
SECTION 6.01. Events of Default. If one or more of the following
events ("Events of Default") shall have occurred and be continuing:
(a) (i) any portion of the commitment fee for this Agreement shall
not be paid when due on the quarterly payment date therefor as set forth in the
Payment Agreement, or (ii) any other amount payable thereunder shall not be
paid when due and any such failure shall continue for three (3) Business Days;
(b) (i) an Event of Default shall occur under Section ____ of the
Indenture, and, if such failure is the result of a covenant breach which is
capable of being remedied, such failure continues for sixty (60) days following
written notice thereof to the Issuer from the Corporation, or (ii) the Issuer
shall fail to have at all times a Remarketing Agent performing the duties
thereof contemplated by the Authorizing Document;
(c) any default by the Issuer shall have occurred and be continuing
in the payment of principal of or premium, if any, or interest on any bond,
note or other evidence of indebtedness issued, assumed or guaranteed by the
Issuer, the obligation and security for which under the Authorizing Document is
senior to, or on parity with, the Variable Rate Bonds;
(d) if the Issuer shall have declared a moratorium affecting the
Variable Rate Bonds; or
(e) any material provision of this Agreement, the Authorizing
Document or the Variable Rate Bonds shall cease for any reason whatsoever to be
a valid and binding agreement of the Issuer or the Issuer shall contest the
validity or enforceability thereof;
then, and in every such event (each such event is herein called a "Termination
Event"), (i) the interest rate payable on Provider Bonds shall increase to the
Default Rate, and (ii) the Corporation may terminate the Corporation's
obligation to purchase Variable Rate Bonds pursuant to this Agreement as
provided in Section 2.03; provided that an Event of Default shall not affect
the obligation of the Corporation to purchase Variable Rate Bonds in accordance
with the provisions of this Agreement prior to the close of business on the
date on which such obligation terminates pursuant to Section 2.03.
ARTICLE VII
MISCELLANEOUS
SECTION 7.01. Notices. All notices, requests and other communications
to any party hereunder shall be in writing (including fax or similar writing)
and shall be given to such party at its address or facsimile number set forth
on the signature pages hereof or such other address or facsimile number as such
party may hereafter specify for the purpose by notice to the other parties.
Each such notice, request or other communication shall be effective (i) if
given by facsimile, when such facsimile is transmitted to the facsimile number
specified in this Section and the appropriate answerback is received, (ii) if
given by mail, 72 hours after such communication is deposited in the mails with
first class postage prepaid, addressed as aforesaid or (iii) if given by any
other means, when delivered at the address specified in this Section; provided
that notices to the Corporation under Sections 2.02 and 2.04 shall not be
effective until received and that notices under Sections 2.02 and 2.04 may also
be given by telephone to the Corporation at the telephone numbers listed on the
signature pages hereof (or such other telephone number as may be designated by
the Corporation, by written notice to the Trustee and the Tender Agent, to
receive such notice), immediately confirmed in writing or by facsimile.
SECTION 7.02. No Waivers. (a) The obligations of the parties
hereunder shall not in any way be modified or limited by reference to any other
document, instrument or agreement (including, without limitation, the Variable
Rate Bonds or any other Related Document) except as set forth herein. The
rights of the Corporation hereunder are separate from and in addition to any
rights that any holder of any Variable Rate Bond may have under the terms of
such Variable Rate Bond or any Related Document or otherwise.
(b) No failure or delay by the Corporation in exercising any right,
power or privilege hereunder or under the Variable Rate Bonds shall operate as
a waiver thereof nor shall any single or partial exercise thereof preclude any
other or further exercise thereof or the exercise of any other right, power or
privilege. The rights and remedies herein provided shall be cumulative and not
exclusive of any rights or remedies provided by law. No failure or delay by the
Corporation in exercising any right, power or privilege under or in respect of
the Variable Rate Bonds or any other Related Document shall affect the rights,
powers or privileges of the Corporation hereunder or shall operate as a
limitation or waiver thereof.
SECTION 7.03. Amendments and Waivers. Any provision of this Agreement
may be amended or waived if, but only if, such amendment or waiver is in
writing and is signed by the Trustee and the Corporation. The Trustee will
notify Moody's and Standard & Poor's of any amendment to this Agreement, each
of which must confirm to the Trustee prior to such amendment or waiver becoming
effective that such amendment or waiver shall not result in a change in the
rating initially received from Moody's and Standard & Poor's.
SECTION 7.04. Successors and Assigns. The provisions of this
Agreement shall be binding upon and inure to the benefit of the parties hereto
and their respective successors and assigns; provided that neither party may
assign or otherwise transfer any of its rights under this Agreement without the
prior written consent of the other party except to any successor Trustee
pursuant to the terms of the Authorizing Documents. The Trustee shall notify
Moody's and Standard & Poor's in writing of any assignment or transfer, each of
which must confirm to the Trustee that prior to such assignment or waiver
becoming effective such assignment or transfer shall not result in a change in
the rating initially received from Moody's and Standard & Poor's.
SECTION 7.05. Term of this Agreement. The term of this Agreement
shall be until the earlier of (i) the Scheduled Termination Date and (ii)
payment in full of the principal of and interest on all Variable Rate Bonds
purchased by the Corporation pursuant to this Agreement.
SECTION 7.06. New York Law. This Agreement shall be construed in accordance
with and governed by the law of the State of New York.
SECTION 7.07. Counterparts. This Agreement may be signed in
counterparts, each of which shall be an original, with the same effect as if
the signatures thereto and hereto were upon the same instrument.
SECTION 7.08. Trustee May Act through Agents and Appoint Co-Trustees.
The Trustee may execute any of the powers hereof and perform any duties
hereunder either directly or by or through its agents or attorneys. The Trustee
may delegate to a co-trustee or co-trustees such power, rights, duties and
responsibilities as the Trustee may deem necessary or desirable in order to
permit the Trustee to lawfully execute and perform the duties set forth in this
Agreement.
SECTION 7.09. Beneficiaries. This Agreement is made by the
Corporation with the Trustee and the Issuer for the express benefit of the
holders of the Variable Rate Bonds. Nothing contained herein, express or
implied, is intended to give any person other than the Corporation, the
Trustee, the Issuer and the holders of the Variable Rate Bonds any right,
remedy, or claim hereunder or by reason hereof. Any agreement or covenant
required herein to be performed by or on behalf of the Corporation shall be for
the sole and exclusive benefit of the Trustee, the Issuer and the holders of
the Variable Rate Bonds. Prior to the Scheduled Termination Date and provided
that the Commitment hereunder has not terminated pursuant to the provisions of
Sections 2.03 and 6.01 hereof, the Corporation agrees that it will not assert
any act or failure to act by the Issuer, including without limitation (A) the
commencement of a bankruptcy or similar case by or against the Issuer, (B) the
unenforceability or nonpayment of the Provider Rate in any such case, (C) the
unenforceability of the Payment Agreement, or (D) any default under any Related
Document or Event of Default as a defense to its obligations hereunder, and
that this Agreement shall survive (A) the commencement of a bankruptcy or
similar case by or against the Issuer, (B) the unenforceability or nonpayment
of the Provider Rate in any such case, (C) the unenforceability of the Payment
Agreement among the Issuer, the Trustee and the Corporation in any such case,
or (D) any default under any Related Document or Event of Default. The
Corporation agrees that, so long as this Agreement is in effect and has not
terminated, the holders of the Variable Rate Bonds are express beneficiaries of
this Agreement and, as such, any holder of a Variable Rate Bond shall have the
right to bring suit against the Corporation to enforce this Agreement should
the Corporation fail to perform any of its obligations hereunder.
SECTION 7.10. Capacity of Trustee. The Trustee is entering into this
Agreement solely in its capacity as Trustee [and Tender Agent] under the
Authorizing Document and the duties, powers and liabilities of the Trustee in
acting hereunder as Trustee and as Tender Agent shall be subject to the
provisions of the Authorizing Document including, without limitation, the
provisions of Article __________________ of the Indenture.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed by their respective authorized officers as of the day and year
first above written.
,
as Trustee
--------------------------
By:_______________________
Title:_____________________
Attention:
Fax Number:
Telephone Number:
FGIC SECURITIES PURCHASE, INC.
By_______________________________
Vice President
▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: President
Copy: Managing Counsel
Fax Number: (▇▇▇) ▇▇▇-▇▇▇▇
Telephone number: (▇▇▇) ▇▇▇-▇▇▇▇
EXHIBIT 1
[LETTERHEAD OF THE TRUSTEE/TENDER AGENT]
NOTICE OF PURCHASE
[Date]
FGIC Securities Purchase, Inc.
▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention:__________________________
Re:
Dear Sirs:
Reference is made to the Standby Bond Purchase Agreement
dated as of ___________ (the "Agreement") between __________________ , as
Trustee and FGIC Securities Purchase, Inc. Capitalized terms used herein shall
have the meanings given to them in or by reference to the Agreement.
Pursuant to Section 2.02(a) of the Agreement, we hereby give
you notice that due to the unavailability of remarketing proceeds on the
Purchase Date (hereinafter defined) as set forth in the notice from the
Remarketing Agent pursuant to Section 2.02(a) of the Agreement, such Variable
Rate Bonds are to be purchased by you on ____________ __, 199_ (the "Purchase
Date") pursuant to Section 2.02 of the Agreement. The aggregate Purchase Price
of such Variable Rate Bonds is __________ dollars ($________). Of such
aggregate Purchase Price, __________ dollars ($______) comprises principal of
such Variable Rate Bonds and _________ dollars ($______) comprises interest
accrued on such Variable Rate Bonds to but excluding the Purchase Date. The
Variable Rate Bonds referred to herein bear interest at a Variable Rate and
have not been defeased.
FGIC Securities Purchase, Inc. [Date]
Page Two
The Purchase Price should be provided in immediately available funds
on the Purchase Date.
Very truly yours,
[TRUSTEE/TENDER AGENT]
By:______________________________
Name:
Title:
EXHIBIT 2
[LETTERHEAD OF CORPORATION]
TERMINATION NOTICE
as trustee
Attention:
Re:
Dear Sirs:
Reference is made to the Standby Bond Purchase Agreement
dated as of ___________________ between _________________ , as Trustee and FGIC
Securities Purchase, Inc. (the "Agreement"). Capitalized terms used herein
shall have the meanings given to them in or by reference to the Agreement.
We hereby give you notice that a Termination Event has
occurred and is continuing. Pursuant to Section 2.03 of the Agreement, the
Commitment shall terminate, effective at the close of business on the date
which is the [30th] day following the date of receipt of this Termination
Notice, or if such day is not a Business Day, the next succeeding Business Day.
Please be advised that a Notice of Purchase may not be
delivered following the termination of the Commitment.
Very truly yours,
FGIC SECURITIES PURCHASE, INC.
By: __________________________
Name:
Title:
EXHIBIT 3
NOTICE ADDRESSES
As set forth herein and in the Authorizing Document
A G R E E M E N T
AGREEMENT (the "Agreement") dated as of ______________ , 199_ among
____________ (the "Issuer"), _______________ , as Trustee (the "Trustee") and
FGIC SECURITIES PURCHASE, INC., a Delaware corporation (the "Corporation").
WHEREAS, the Issuer has issued $_______________ in principal amount
of its ___________ (herein called the "Variable Rate Bonds") pursuant to an
_________________ dated as of ______________, _____________ between the Issuer
and the Trustee (the "Indenture" or the "Authorizing Document");
WHEREAS, the Authorizing Document provides that the holders of the
Variable Rate Bonds shall have the option, upon the satisfaction of certain
conditions, to tender Variable Rate Bonds to the Tender Agent for purchase,
upon notice to the Tender Agent as provided for in the Authorizing Document
and, under certain circumstances, may be required to tender their Variable Rate
Bonds for purchase thereof in accordance with the terms of the Authorizing
Document; and
WHEREAS, the Corporation has agreed to purchase such tendered Bonds
pursuant to the terms of a Standby Bond Purchase Agreement dated as of
________________ (the "Standby Bond Purchase Agreement") between the
Corporation and the Trustee;
NOW, THEREFORE, as consideration for the issuance by the Corporation
of the Standby Bond Purchase Agreement and the Corporation's assumption of the
liabilities and undertakings of the Corporation thereunder, the parties hereto
agree as follows (hereinafter, all capitalized terms not otherwise defined
herein shall have the same meanings set forth in the Standby Bond Purchase
Agreement or in the Authorizing Document, wherever such terms appear):
1. Fees. (a) Until the Commitment has terminated, the _____________
shall pay to the Corporation a commitment fee at the rate of ___% per annum on
the daily average amount of the Available Commitment. Such commitment fee shall
accrue from and including the Effective Date to but excluding the date of
termination of the Commitment in its entirety and shall be payable quarterly in
arrears commencing _________________ , on each ________________ , and upon the
date of termination of the Commitment in its entirety. The Corporation shall
use its best efforts to mail to the Issuer and the Trustee, not fewer than 30
days prior to each quarterly due date, an invoice for the amount of the
commitment fee next due. The commitment fee shall be computed on the basis of a
year of 365/366 days and paid for the actual number of days elapsed.
(b) Whenever any payment hereunder shall be due on a day which is not
a Business Day, the date for payment thereof shall be extended to the next
succeeding Business Day.
2. General Provisions as to Payments. Notwithstanding any provision
contained in the Variable Rate Bonds, any related Document, or any other
instrument, so long as any of the Variable Rate Bonds are owned by the
Corporation under the Standby Bond Purchase Agreement, the Trustee on behalf of
the Issuer shall cause each payment of principal of and interest on such
Variable Rate Bonds to be paid not later than 2:00 p.m., New York City time on
the date when due in immediately available funds, to the account of the
Corporation at ________________ , New York, New York, A/C No. ________________
. Commitment fees due to the Corporation pursuant to Section 1 hereof shall be
paid by the Issuer not later than 2:00 p.m., New York City time on the date
when due in immediately available funds, or on the prior day in next day funds,
to the account of the Corporation.
3. Expenses. The Issuer shall pay all reasonable out-of-pocket
expenses of the Corporation, including (i) fees and disbursements of counsel
for the Corporation and counsel for the Trustee in connection with the
preparation and review of the Standby Bond Purchase Agreement, this Agreement,
Securities and Exchange Commission filings, the Preliminary and final Official
Statements and the Related Documents, (ii) in connection with any waiver or
consent hereunder or thereunder or any amendment hereof or thereof or any
default or alleged default hereunder or thereunder and (iii) if an Event of
Default occurs under the Standby Bond Purchase Agreement, all out-of-pocket
expenses incurred by the Corporation and the Trustee, including fees and
disbursements of counsel, in connection with such Event of Default and
collection and other enforcement proceedings resulting therefrom.
4. Indemnification. To the extent permitted by law, the hereby Issuer
indemnifies and holds harmless the Corporation from and against the cost of
defending any and all third party claims and all costs, losses, expenses,
fines, penalties and all other liabilities whatsoever that the Corporation may
incur (or may be claimed against the Corporation by any person whatsoever) (i)
by reason of any untrue statement or alleged untrue statement relating to the
Issuer or of any material fact contained or incorporated by reference in the
Preliminary and Final Official Statements or Preliminary or Final Reoffering
Circular, or supplements thereto, relating to the Variable Rate Bonds, or the
omission or alleged omission to state therein a material fact relating to the
Issuer or necessary to make such statements, in the light of the circumstances
under which they are or were made, not misleading (excluding any materials
expressly provided for inclusion therein by the Corporation or Financial
Guaranty Insurance Company); provided that the Issuer shall not be required to
indemnify the Corporation for any costs of defending third party claims or
liabilities to the extent, but only to the extent, such claims or liabilities
arise due to the willful misconduct or gross negligence of the Corporation or
are attributable to information concerning the Corporation or Financial
Guaranty Insurance Company expressly for use in the Official Statement or
Preliminary or Final Reoffering Circular, or supplements thereto. The
Corporation will promptly notify the Issuer upon becoming aware of any claims
or liabilities giving rise to a right to indemnification hereunder and will
cooperate with the Issuer in the defense of such claims or liabilities. Nothing
in this Section is intended to limit the Issuer's obligations contained in
other parts of this Agreement. The Issuer will not refer to the Corporation in
any materials used in marketing the Variable Rate Bonds without the prior
written consent of the Corporation. The Corporation hereby agrees to provide
the Issuer with any disclosure information which the Issuer may reasonably
request relating to the Corporation for inclusion in the Preliminary and Final
Official Statements relating to the Variable Rate Bonds.
5. Term of the Standby Bond Purchase Agreement. As further provided
in the Standby Bond Purchase Agreement, the term of the Standby Bond Purchase
Agreement shall be until the later of (i) the termination of the Commitment in
its entirety and (ii) payment in full of the principal of and interest on all
Variable Rate Bonds purchased by the Corporation pursuant to the Standby Bond
Purchase Agreement and payment in full of any other amounts required to be paid
by the Issuer pursuant to any provision of this Agreement. Any termination by
the Corporation or by the Trustee shall be subject to the Issuer's payment in
full of all sums due pursuant to this Agreement and, notwithstanding a
termination of the Standby Bond Purchase Agreement by either the Corporation or
the Trustee, the provisions of Section 5 shall survive such termination and
shall remain in full force and effect.
6. Issuer Representations and Warranties. The Issuer represents and
warrants that, as of the date on which this Agreement is executed:
(a) Existence. The Issuer is validly existing as a public benefit
corporation under the laws of the State of New York, including the state
constitution, with full right and power to issue the Bonds and to execute,
deliver and perform its obligations under this Agreement and each Related
Document.
(b) Authorization; Contravention. The execution, delivery and
performance by the Issuer of this Agreement and each Related Document are
within the Issuer's powers, have been duly authorized by all necessary action,
require no action by or in respect of, or filing with, any governmental body,
agency or official and do not violate or contravene, or constitute a default
under, any provision of applicable law, charter, ordinance or regulation or of
any material agreement, judgment, injunction, order, decree or other instrument
binding upon the Issuer or result in the creation or imposition of any lien or
encumbrance on any asset of the Issuer.
(c) Binding Effect. This Agreement and each Related Document
constitutes a valid, binding and enforceable agreement of the Issuer, subject
to applicable laws affecting creditors' rights generally.
(d) No Default. It is not, in any material respect, in breach of or
default under its charter or other similar documents, or any applicable law or
administrative regulation of the State or of the United States, relating, in
each case, to the issuance of debt securities by it, or any applicable
judgment, decree, loan agreement, note, resolution, ordinance, agreement or
other instrument to which it is a party or is otherwise subject. Late delivery
of financials or other reporting materials shall not be deemed material for
purposes of this Section as long as said materials are delivered within 180
days of the applicable due date.
(e) Litigation. Except as disclosed in the Official Statement with
respect to the Bonds, there is no action, suit or proceeding pending against,
or to the knowledge of the Issuer threatened against or affecting, the Issuer
before any court or arbitrator or any governmental body, agency or official in
which there is a reasonable possibility of an adverse decision which could
materially adversely affect the financial position or results of operations of
the Issuer or which in any manner draws into question the validity or
enforceability of this Agreement or any Related Document.
(f) No Sovereign Immunity. The defense of sovereign immunity is not
available to the Issuer in any proceeding by the Corporation to enforce any of
the obligations of the Issuer under this Agreement or the Bonds and, to the
fullest extent permitted by law, the Issuer consents to the initiation of any
such proceeding in any federal or state court of competent jurisdiction located
in the State of New York and agrees not to assert the defense of sovereign
immunity in any such proceeding.
7. New York Law. This Agreement shall be construed in accordance with
and governed by the law of the State of New York. Concurrently with the
execution and delivery hereof, the Issuer shall deliver an opinion of its
general counsel, addressed to, and in form and substance acceptable to, the
Corporation, as to the power, authority and valid and binding effect of this
Agreement upon the Issuer, subject only to the customary creditors' rights
exceptions.
8. Covenants. The Issuer agrees that so long as the Corporation has a
Commitment hereunder or any amount payable hereunder or under any Bond
purchased by the Corporation pursuant to this Agreement remains unpaid:
(a) Information. The Issuer will deliver to the Corporation as soon
as possible and in any event within 120 days after the end of each Fiscal Year
of the Issuer, a balance sheet of the Issuer as of the end of such Fiscal Year
and the related statements of revenue and expense, setting forth in each case
in comparative form the figures for the previous Fiscal Year, all certified as
to the fairness of presentation, generally accepted accounting principles and
consistency by a nationally recognized firm of independent certified public
accountants.
(b) No Amendment Without Consent of the Corporation. Without the
prior written consent of the Corporation, the Issuer will not agree or consent
to any amendment, supplement or modification of any Related Document, nor waive
any provision thereof.
(c) Maintenance of Remarketing Agent. The Issuer will at all times
cause the Issuer to have a Remarketing Agent performing the duties thereof
contemplated by the Authorizing Document.
9. Capacity of Trustee. The Trustee is entering into this Agreement
solely in its capacity as Trustee under the Authorizing Document and the
duties, powers and liabilities of the Trustee in acting hereunder shall be
subject to the provisions of the Authorizing Document, including, without
limitation, the provisions of Article _______________________ of the Indenture
thereof.
10. Counterparts. This Agreement may be signed in counterparts, each
of which shall be an original, with the same effect as if the signatures
thereto and hereto were upon the same instrument.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed by their respective authorized officers as of the day and year
first above written.
, as Trustee
By:_______________________
Title:
Address:
Attention:
Fax Number:
Telephone Number:
, as Issuer
By:________________________
Title:
Address:
Attention:
Fax Number:
Telephone Number:
FGIC SECURITIES PURCHASE, INC.
By:____________________________
Title: Vice President
▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: President
Copy To: Managing Counsel
Fax Number: (▇▇▇) ▇▇▇-▇▇▇▇
Telephone Number: (▇▇▇) ▇▇▇-▇▇▇▇
EXHIBIT A
OPINION OF COUNSEL FOR THE ISSUER
____ __, 199_
--------------------------------
Attention: ____________________
FGIC Securities Purchase, Inc.
▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Re:
Dear Sirs:
We have acted as counsel for the _______________ in
connection with (i) the Standby Bond Purchase Agreement dated as of
_______________ (the "Standby Bond Purchase Agreement") between FGIC Securities
Purchase, Inc. and ________________ , as Trustee, (ii) the _________________
between the Issuer and the Trustee dated as of ________________ relating to the
Variable Rate Bonds described therein (the "Authorizing Document") and (iii)
the Payment Agreement among the Issuer,, the Trustee and FGIC Securities
Purchase, Inc. dated as of _______________ (the "Payment Agreement"). The
Standby Bond Purchase Agreement, the Authorizing Document and the Payment
Agreement are hereinafter referred to as the "Agreements". You have requested
our opinion as to certain matters concerning the Agreements. Terms defined in
the Standby Bond Purchase Agreement or in the Payment Agreement are used herein
as defined therein.
____ __, 199_
Page Two
Based on our examination of existing law, the Agreements, such legal
proceedings and such other documents as we deem necessary to render this
opinion, we are of the opinion that:
1. The Issuer is duly incorporated and is validly existing as a
company in good standing under the laws of _______________.
2. The Payment Agreement has been duly executed and delivered by the
Issuer pursuant to due authorization and the Payment Agreement constitutes the
valid and binding agreement of the Issuer enforceable against the Issuer in
accordance with its terms, except as (x) limited by insolvency, reorganization,
receivership, conservatorship, liquidation, moratorium or other similar laws
affecting the enforcement of creditors' rights generally as such laws would
apply in the event of the insolvency, reorganization, receivership,
conservatorship or liquidation of, or other similar occurrence with respect to,
the Issuer or in the event of any moratorium or similar occurrence affecting
the Issuer, (y) limited by equitable principles (regardless of whether the
issue of enforceability is considered in a proceeding in equity or at law) and
(z) the indemnification provisions thereof may be limited by Federal securities
laws.
3. The execution and delivery by the Issuer of, and the performance
by the Issuer of its obligations under, the Payment Agreement will not
contravene any provision of applicable law or the Restated Articles of
Incorporation or By-laws, each as amended, of the Issuer or any material
agreement or other instrument binding upon the Issuer known to us, and no
consent, approval or authorization of any governmental body or agency (which
has not been obtained) is required for the performance by the Issuer of its
obligations under the Payment Agreement.
4. Except as disclosed in _______________________________ 's
Registration Statement on Form S- (Registration No. 333- _________ ) in the
form it became effective with the Securities and Exchange Commission, there is
no action, suit or proceeding pending against, or to the best of our knowledge,
threatened against, the Issuer before any court or arbitrator or any
governmental body, agency or official in which there is a reasonable
possibility of an adverse decision which could materially adversely affect the
financial position or results of operations of the Issuer or which in any
manner draws into question the validity or enforceability of the Payment
Agreement.
Very truly yours,
_____________________
Counsel for Issuer