<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM T-1
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STATEMENT OF ELIGIBILITY
UNDER THE TRUST INDENTURE ACT OF 1939
OF A CORPORATION DESIGNATED TO ACT AS TRUSTEE
CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY OF A TRUSTEE
PURSUANT TO SECTION 305(B)(2)____________________________
BANK ONE, NATIONAL ASSOCIATION
(Exact name of trustee as specified in its charter)
A National Banking Association 36-0899825
(I.R.S. employer identification number)
1 Bank One Plaza, Chicago, Illinois 60670-0126
(Address of principal executive offices) (Zip Code)
Bank One, National Association
1 Bank One Plaza, Suite IL1-0286
Chicago, Illinois 60670-0286
Attn: Lynn A. Goldstein, Law Department (312) 732-6919
(Name, address and telephone number of agent for service)
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HEADLANDS HOME EQUITY LOAN TRUST 1999-1
(Exact name of obligor as specified in its charter)
Delaware Pending
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification number)
c/o Wilmington Trust Company, as Owner Trustee
Rodney Square North
1100 Market Street 19890
Wilmington, Delaware (Zip Code)
(Address of Principal Executive Offices)
<PAGE>
HEADLANDS MORTGAGE SECURITIES INC.
(Exact name of sponsor of the obligor as specified in its charter)
Delaware 68-039-7342
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification number)
700 Larkspur Landing Circle
Suite 240 94939
Larkspur, California (Zip Code)
(Address of Principal Executive Offices)
Headlands Home Equity Loan Trust 1999-1
Asset-Backed Notes
(Title of Indenture Securities)
<PAGE>
Item 1. General Information. Furnish the following information as to the
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trustee:
(a) Name and address of each examining or supervision authority to
which it is subject.
Comptroller of the Currency, Washington, D. C.; Federal Deposit
Insurance Corporation, Washington, D. C.; The Board of Governors
of the Federal Reserve System, Washington, D. C..
(b) Whether it is authorized to exercise corporate trust powers.
The trustee is authorized to exercise corporate trust powers.
Item 2. Affiliations with the Obligor. If the obligor is an affiliate of the
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trustee, describe each such affiliation.
No such affiliation exists with the trustee.
Item 16. List of Exhibits. List below all exhibits filed as a part of this
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Statement of Eligibility.
1. A copy of the articles of association of the trustee now in
effect.
2. A copy of the certificates of authority of the trustee to
commence business.*
3. A copy of the authorization of the trustee to exercise corporate
trust powers.*
4. A copy of the existing by-laws of the trustee.
5. Not applicable.
6. The consent of the trustee required by Section 321(b) of the Act.
7. A copy of the latest report of condition of the trustee published
pursuant to law or the requirements of its supervising or
examining authority.
8. Not applicable.
9. Not applicable.
* Exhibits 2 and 3 are herein incorporated by reference to Exhibits bearing
identical numbers in Item 16 of the Form T-1 of Bank One, National Association,
formerly known as The First National Bank of Chicago, filed as Exhibit 25 to the
Registration Statement on Form S-3 of U S WEST Capital Funding, Inc. filed with
the Securities and Exchange Commission on May 6, 1998 (Registration No. 333-
51907-01).
<PAGE>
Pursuant to the requirements of the Trust Indenture Act of 1939, as amended, the
trustee, Bank One, National Association, a national banking association
organized and existing under the laws of the United States of America, has duly
caused this Statement of Eligibility to be signed on its behalf by the
undersigned, thereunto duly authorized, all in the City of Chicago, and State of
Illinois, on the 27th day of September, 1999.
Bank One, National Association
By: /s/ Steven M. Wagner
-------------------------------
Steven M. Wagner
First Vice President
<PAGE>
EXHIBIT 1
ARTICLES OF ASSOCIATION OF TRUSTEE
<PAGE>
EXHIBIT 1
ARTICLES OF ASSOCIATION
OF
BANK ONE, NATIONAL ASSOCIATION
(Corrected To September 13, 1999)
FIRST. The title of this Association, organized for the purpose of carrying
on the business of banking under the laws of the United States, shall be "Bank
One, National Association".
SECOND. The main office of this Association shall be in Chicago, County of
Cook, State of Illinois. The business of the Association shall be conducted at
its main office and its branches.
THIRD. The Board of Directors of this Association shall consist of not less
than five nor more than twenty-five persons, the exact number of directors
within such minimum and maximum limits to be fixed and determined from time to
time by resolution of a majority of the full Board of Directors or by resolution
of the shareholders at any annual or special meeting thereof. Any vacancy in
the Board of Directors may be filled by action of a majority of the remaining
directors between meetings of shareholders. The Board of Directors, by the vote
of a majority of the full Board, may, between meetings of shareholders, increase
the membership of the Board within such maximum limit by not more than four
members if the number of directors last elected by shareholders was 16 or more
and by not more than two members if the number of directors last elected by
shareholders was 15 or less.
FOURTH. The regular annual meeting of the shareholders of this Association
shall be held at its main banking house, or other convenient place duly
authorized by the Board of Directors, on such day of each year as is specified
therefor in the by-laws.
FIFTH. The amount of authorized capital stock of this Association shall be
Five Hundred Twenty-Five Million Eight Hundred Fifty-Eight Thousand Two Hundred
Dollars ($525,858,200) divided into 26,292,910 shares of common stock of the par
value per share of Twenty Dollars ($20); but said capital stock may be increased
or decreased from time to time, in accordance with the provisions of the laws of
the United States.
In the event of any such increase in the capital stock of this Association by
the sale of additional shares or the distribution of additional shares as a
stock dividend, each shareholder of this Association (unless otherwise provided
by the shareholders' vote or
<PAGE>
EXHIBIT 1
votes authorizing the increase) shall be entitled, in proportion to the number
of shares of said capital stock owned by him before such increase, to
proportionate rights in respect of such additional shares as follows: (1) to the
extent that such shareholder's proportionate right in respect of such additional
shares shall embrace one or more whole shares of such additional shares, to
receive (a) in the case of a sale, a transferable warrant entitling the holder
to subscribe, within the specified subscription period, for such one or more
whole shares of such additional shares or (b) in the case of a stock dividend, a
certificate evidencing such one or more whole shares of such additional shares;
and (2) to the extent that such shareholder's proportionate right in respect of
such additional shares shall embrace a fraction of a share, to receive (a) in
the case of a sale, a fractional subscription warrant, conditioned that it shall
be void unless, within the specified subscription period, it is combined with
other such fractional subscription warrants in the aggregate entitling the
holder thereof to subscribe for a whole share or whole shares of such additional
shares and such subscription is completed by such holder of such combined
fractional warrants or (b) in the case of a stock dividend, a fractional warrant
which shall not represent or entitle the holder thereof to any of the privileges
of a shareholder of this Association but may be combined with other such
fractional warrants in the aggregate entitling the holder thereof to exchange
them for a whole share or whole shares of such additional shares and conditioned
that the holder exchanging such combined fractional warrants for such whole
share or whole shares of such additional shares shall receive any dividends
applicable to such whole share or whole shares declared after the date of such
fractional warrants and payable in respect of such whole share or whole shares
at the time of such exchange.
In the event of an increase in the capital stock of this Association in
pursuance of a statutory consolidation to which this Association may be a party,
the additional shares shall be issued in such a manner as the contract or plan
of consolidation may provide, pursuant to and in contemplation of the statute
under which said consolidation is effected.
In the event of an increase in the capital stock of this Association in
pursuance of a plan or contract (other than in the case of a statutory
consolidation) for the acquisition by this Association of the assets, in whole
or in part, and the good will of another banking institution or banker, the
additional shares shall be subscribed for by or issued to any persons, firms,
trustees or corporations, whether or not shareholders of this Association, as,
in its discretion in the execution of such plan or contract, the Board of
Directors may approve.
Page 2
<PAGE>
EXHIBIT 1
The Association, at any time and from time to time, may authorize and issue
debt obligations, whether or not subordinated, without the approval of the
shareholders.
SIXTH. The Board of Directors shall appoint one of its members President of
this Association, who shall be Chairman of the Board; but the Board of Directors
may appoint a director, in lieu of the President, to be Chairman of the Board,
who shall perform such duties as may be designated by the Board of Directors.
The Board of Directors shall have the power to appoint one or more Vice
Presidents; to appoint a Cashier and such other officers as may be required to
transact the business of this Association; to fix the salaries to be paid to all
officers of this Association; and to dismiss such officers, or any of them; but
the Board of Directors may delegate to the Chairman of the Board the authority
to exercise such powers of appointment, salary determination and dismissal.
The Board of Directors shall have the power to define the duties of officers
and employees of this Association, to require bonds from them, and to fix the
penalty thereof; to regulate the manner in which directors shall be elected or
appointed, and to appoint judges of election; in the event of an increase of the
capital stock of this Association to regulate the manner in which such increase
shall be made; to make all by-laws that it may be lawful for them to make for
the general regulation of the business of this Association and the management of
its affairs; and generally to do and perform all acts that it may be lawful for
a Board of Directors to do and perform.
The Board of Directors, without the approval of the shareholders, shall have
the power to change the location of the main office of this Association, subject
to such limitations as from time to time may be provided by law.
SEVENTH. This Association shall have succession from the date of its
organization certificate until such time as it be dissolved by the act of its
shareholders in accordance with the provisions of the banking laws of the United
States, or until its franchise becomes forfeited by reason of violation of law,
or until terminated by either a general or a special act of Congress, or until
its affairs be placed in the hands of a receiver and finally wound up by him.
EIGHTH. The Board of Directors of this Association, the Chairman of the
Board, or the President, may call a special meeting of the shareholders at any
time: Provided, however, that, unless otherwise provided by the by-laws or the
laws of the United
Page 3
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EXHIBIT 1
States, or waived by the shareholders, notice of the time, place and purpose of
the meeting shall be given to each shareholder of record of this Association
entitled to act and vote at such meeting, by a notice in writing either mailed
(prepaid first class postage) to such shareholder at his address as shown upon
the books of this Association or delivered manually to such shareholder, not
less than ten days prior to the date fixed for any such meeting.
NINTH. (a) This Association shall indemnify and hold harmless each person who
was or is a party or is threatened to be made a party to any threatened, pending
or completed action, suit or proceeding, whether civil, criminal, administrative
or investigative, by reason of the fact that he, or a person of whom he is the
legal representative, is or was a director, officer or employee of this
Association, or is or was serving at the request of this Association as a
director, officer, employee or agent of another corporation, partnership, joint
venture, trust or other enterprise, to the fullest extent permitted by the
General Corporation Law of Delaware, as the same exists or may hereafter be
amended (but, in the case of any such amendment, only to the extent that such
amendment permits this Association to provide broader indemnification rights
than said law permitted this Association to provide prior to such amendment)
against all expenses (including attorneys' fees, judgments, fines, penalties and
amounts paid in settlement) actually and reasonably incurred by him in
connection therewith. This Association may, by action of the Board of
Directors, provide indemnification to agents of this Association with a lesser
or the same scope and effect as the foregoing indemnification of directors,
officers and employees of this Association.
(b) Expenses incurred by a director, officer or employee in defending a civil
or criminal action, suit or proceeding shall be paid by this Association in
advance of the final disposition of such action, suit or proceeding upon receipt
of an undertaking by or on behalf of such director, officer or employee to repay
such amount if it shall ultimately be determined that he is not entitled to be
indemnified by this Association. Such expenses incurred by agents may be so
paid upon such terms and conditions, if any, as the Board of Directors deems
appropriate.
(c) The indemnification provided by this Article does not authorize this
Association to indemnify any director, officer or employee against expenses,
penalties, or other payments incurred in an administrative proceeding or action
instituted by an appropriate bank regulatory agency which proceeding or action
results in a final order against such director, officer or employee assessing
civil money penalties or requiring affirmative action in the form of payments to
this Association.
Page 4
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EXHIBIT 1
(d) The indemnification and advancement of expenses provided by, or granted
pursuant to, this Article Ninth shall not be deemed exclusive of any other
rights to which a person seeking indemnification or advancement of expenses may
be entitled under any statute, by-law, agreement, vote of shareholders or
disinterested directors or otherwise, both as to action in his official capacity
and as to action in another capacity while holding such office. Notwithstanding
the provisions of this Article, this Association may indemnify any person
referred to in paragraph (a) of this Article to the fullest extent permitted
under the statutes applicable to national banking associations and the rules,
regulations and interpretations promulgated thereunder by the primary regulator
of national banking associations, in each case now or hereafter in effect.
(e) This Association shall have power to purchase and maintain insurance on
behalf of any person who is or was a director, officer, employee or agent of
this Association, or is or was serving at the request of this Association as a
director, officer, employee or agent of another corporation, partnership, joint
venture, trust or other enterprise, against any liability asserted against him
and incurred by him in any such capacity, or arising out of his status as such,
whether or not this Association would have the power to indemnify him against
such liability under the provisions of this Article. This provision does not,
however, authorize this Association to purchase insurance covering civil money
penalties assessed against a director or employee of this Association pursuant
to a formal order by an appropriate bank regulatory agency.
(f) Neither the amendment nor repeal of this Article Ninth, nor the adoption
of any provision of these Articles of Association inconsistent with this Article
Ninth, shall eliminate or reduce the effect of this Article Ninth in respect of
any matter occurring, or any cause of action, suit or claim that, but for this
Article Ninth, would accrue or arise, prior to such amendment, repeal or
adoption of an inconsistent provision.
TENTH. These Articles of Association may, subject to the provisions of the
banking laws of the United States, be amended at any regular or special meeting
of the shareholders by the affirmative vote of the shareholders owning at least
a majority of the stock of this Association.
Page 5
<PAGE>
EXHIBIT 4
EXISTING BY-LAWS OF TRUSTEE
<PAGE>
EXHIBIT 4
BY-LAWS
OF
BANK ONE, NATIONAL ASSOCIATION
AS AMENDED AND RESTATED SEPTEMBER 13, 1999
<PAGE>
EXHIBIT 4
BY-LAWS
OF
BANK ONE, NATIONAL ASSOCIATION
ARTICLE I
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CORPORATE GOVERNANCE
--------------------
To the extent not inconsistent with applicable Federal banking statutes or
regulations, or safe and sound banking practices, the Bank shall follow the
corporate governance procedures of the Delaware General Corporation Law, as
amended.
ARTICLE II
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SHAREHOLDERS
------------
SECTION 1. Annual Meeting. The regular annual meeting of shareholders of
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the Bank to elect directors and to transact whatever other business may properly
come before the meeting shall be held in its main office on the third Tuesday in
May if not a legal holiday under the Laws of Illinois, and if a legal holiday,
then on the next business day following, at 11:30 A.M., or on such other date
and time as shall be designated by the Board of Directors. If, for any cause,
the annual election of directors should not be held on that date, the Board
shall order the election to be held on some subsequent day, of which special
notice shall be given.
SECTION 2. Judges of Election. To the extent required by law, the Board
-------------------
of Directors shall, prior to the time of the election of directors, appoint
three persons to be Judges of Election, who shall hold and conduct the same, and
who shall, after the election has been held, certify under their hands to the
Cashier of the Bank the result thereof and the names of the directors-elect.
SECTION 3. Notice to Directors-Elect. The Cashier upon receiving the
--------------------------
Certificate of the Judges of Election as aforesaid, shall cause the same to be
recorded upon the minute book of the Bank, and shall notify the directors-elect
of their election and of the time at which they are required to meet at the main
office of the Bank for the purpose of organizing the new Board. If at the time
fixed for the meeting of the directors-elect there should not be a quorum
present, the members present may adjourn from time to time until a quorum is
obtained.
SECTION 4. Special Meetings. Special meetings of the shareholders may be
-----------------
called in accordance with Article EIGHTH of the Bank's Articles of Association.
SECTION 5. Record Date. The Board of Directors may fix in advance a day
------------
not more than sixty (60) or less than ten (10) days prior to the date of holding
any regular or special meeting of shareholders as the day as of which
shareholders entitled to notice of and to vote at such meeting shall be
determined.
<PAGE>
EXHIBIT 4
SECTION 6. Notice. The Bank shall mail notice of any meeting of
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shareholders at least 10 days prior to the meeting by first class mail, unless
the Office of the Comptroller of the Currency determines that an emergency
circumstance exists. If the Bank is a wholly-owned subsidiary of a company, the
sole shareholder may waive notice of the shareholder's meeting.
SECTION 7. Consent of Shareholders in Lieu of Annual or Special Meeting.
-------------------------------------------------------------
Unless otherwise restricted by law or the Articles of Association, any action
which may be taken at any annual or special shareholder meeting may be taken
without a meeting, without prior notice and without a vote, if written consent
setting forth the action so taken shall be signed by the holders of outstanding
stock having not less than the minimum number of votes that would be necessary
to authorize or take such action at a meeting at which all shares entitled to
vote thereon were present and voted. Prompt notice of the taking of the
corporate action without a meeting by less than unanimous written consent shall
be given to those shareholders who did not give written consent.
SECTION 8. Minutes. The proceedings of shareholders at all regular and
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special meetings or by written consent in lieu of a meeting shall be recorded in
the minute book, together with the Articles of Association of the Bank and the
returns of the Judges of Election. The minutes of each meeting shall be signed
by the Presiding Officer, and attested by the Cashier, or other officer of the
Bank acting in place of the Cashier.
ARTICLE III
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DIRECTORS
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SECTION 1. Authority. The Board of Directors shall have the power to
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manage and administer the business and affairs of the Bank. Except as expressly
limited by law, all corporate powers of the Bank shall be vested in and may be
exercised by the Board of Directors.
SECTION 2. Number. The Board of Directors shall at all times consist of
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not less than five nor more than twenty-five individuals. The exact number
within such minimum and maximum limits shall be fixed and determined from time
to time by resolution of a majority of the full Board of Directors or by
resolution of the shareholders at any meeting thereof; provided, however, that
the Board of Directors may not increase the number of directors to a number
which: (1) exceeds by more than two the number of directors last elected by
shareholders where such number was fifteen or less; or (ii) exceeds by more than
four the number of directors last elected by shareholders where such number was
sixteen or more, but in no event shall the number of directors exceed twenty-
five.
SECTION 3. Term of Office. Each director shall hold office from the date
--------------
of his election or appointment until the next annual shareholder meeting. Any
director ceasing to be the owner of the amount of stock required by law or in
any other manner becoming disqualified shall thereupon vacate his office as
director.
SECTION 4. Compensation. The Board of Directors may provide that a
------------
reasonable fee be paid to any of its members or to the members of any duly
authorized committee for services
<PAGE>
EXHIBIT 4
rendered. No such payment shall preclude any director from serving the Bank in
any other capacity and receiving compensation therefor.
SECTION 5. Regular Meetings. Regular meetings of the Board of Directors
-----------------
shall be held on such dates, times and locations as determined by the Chairman
of the Board and communicated in writing to the directors.
SECTION 6. Special Meetings. Special meetings of the Board of Directors
-----------------
may be called by the Chairman of the Board or the President. Such meetings
shall be held at such times and at such places as shall be determined by the
officer calling the meeting. Notice of any special meeting of directors shall
be given to each director at the director's business or residence in writing by
hand delivery, first-class or overnight mail or courier service, telegram or
facsimile transmission, or orally by telephone. If mailed by first-class mail,
such notice shall be deemed adequately delivered when deposited in the United
States mail so addressed, with postage thereon prepaid, at least two (2) days
before such meeting. If by telegram, overnight mail or courier service, such
notice shall be deemed adequately delivered when the telegram is delivered to
the telegraph company or the notice is delivered to the overnight mail or
courier service company at least twenty-four (24) hours before such meeting. If
by facsimile transmission, such notice shall be deemed adequately delivered when
the notice is transmitted at least twelve (12) hours before such meeting. Such
notice need not state the purposes of the meeting. Any or all directors may
waive notice of any meeting, either before or after the meeting. Attendance of
a director at a meeting shall constitute a waiver of notice of such meeting,
except when the director attends for the express purpose of objecting, at the
beginning of the meeting, to the transaction of any business because the meeting
is not lawfully called or convened.
SECTION 7. Quorum; Majority Vote. A quorum of directors shall be
-----------------------
required to transact business at any regular or special meeting of the Board of
Directors. A majority of the directors shall constitute a quorum. Each
director shall be entitled to one vote. A vote by a majority of the directors
present at any regular or special meeting of the Board of Directors at which a
quorum is present shall be required to approve any matter or proposal at any
such meeting.
SECTION 8. Vacancies. When any vacancy occurs in the Board of Directors,
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a majority of the remaining members of the Board, according to the laws of the
United States, may appoint a director to fill such vacancy at any regular
meeting of the Board of Directors, or at a special meeting called for that
purpose at which a quorum is present, or if the directors remaining in office
constitute fewer than a quorum of the Board of Directors, by the affirmative
vote of a majority of all the directors remaining in office, or by shareholders
at a special meeting called for that purpose. At any such shareholder meeting,
each shareholder entitled to vote shall have the right to multiply the number of
votes he or she is entitled to cast by the number of vacancies being filled and
cast the product for a single candidate or distribute the product among two or
more candidates. A vacancy that will occur at a specific later date (by reason
of a resignation effective at a later date) may be filled before the vacancy
occurs but the new director may not take office until the vacancy occurs.
SECTION 9. Presiding Officer. The Chairman of the Board shall preside
------------------
at all meetings of the Board of Directors at which he is present. In the
absence of the Chairman of the Board, the President shall perform the duties of
the Chairman of the Board and shall preside at the meetings of the Board of
Directors. In the absence of the Chairman of the Board and the President, the
Vice
<PAGE>
EXHIBIT 4
Chairman of the Board (or in the event there be more than one Vice Chairman of
the Board, the Vice Chairmen of the Board in the order designated, or in the
absence of any designation, then in the order of their election) shall perform
their duties and shall preside at the meetings of the Board of Directors.
SECTION 10. Minutes of Meeting. The Cashier shall act as secretary to
-------------------
the Board of Directors to take minutes at any regular or special meeting of the
Board of Directors. If the Cashier is not present at any such meeting, the
Chairman of the Board may designate a secretary pro tem to take minutes at the
meeting. The Cashier or secretary pro tem shall record the actions and
proceedings at each regular or special meeting of the Board of Directors as
minutes of the meeting and shall maintain such minutes in a minute book of
proceedings of such meetings of the Board of Directors. Minutes of each such
meeting shall be signed by the presiding officer and secretary of each meeting.
SECTION 11. Participation in Meetings by Telephone Unless otherwise
----------------------------------------
restricted by law or the Articles of Association, members of the Board of
Directors, or of any committee thereof, may participate in a meeting of the
Board of Directors or committee by means of conference telephone or similar
communications equipment which allows each person participating in the meeting
to hear each other. Participation in such a meeting shall constitute presence
in person at such meeting.
SECTION 12. Consent of Directors in Lieu of Meeting. Unless otherwise
----------------------------------------
restricted by law or the Articles of Association, any action required or
permitted to be taken at any meeting of the Board of Directors, or of any
committee thereof, may be taken without a meeting if all members of the Board or
committee, as the case may be, consent thereto in writing, and the writing or
writings are filed with the minutes of proceedings of the Board or committee.
SECTION 13. Committees. The Board of Directors may, by resolution passed
-----------
by a majority of the entire Board, designate one or more committees, each
committee to consist of two or more of the Directors of the Bank. The Board of
Directors may designate one or more Directors as alternate members of any
committee, who may replace any absent or disqualified member at any meeting of
the committee. Any such committee, to the extent provided in the resolution,
shall have and may exercise the powers of the Board of Directors in the
management of the business and affairs of the Bank, and may authorize the seal
of the Bank to be affixed to all papers which may require it; provided, however,
that in the absence or disqualification of any member of such committee or
committees, the member or members thereof present at any meeting and not
disqualified from voting, whether or not he or they constitute a quorum, may
unanimously appoint another member of the Board of Directors to act at the
meeting in the place of any such absent or disqualified member. Such committee
or committees shall have such name or names as may be determined from time to
time by resolution adopted by the Board of Directors. As used in these By-Laws,
"entire Board" means the total number of Directors the Bank would have if there
were no vacancies.
There shall be an Executive Committee composed and created as the Board of
Directors may designate by resolution passed by a majority of the entire Board.
During intervals between the regular meetings of the Board of Directors, the
Executive Committee, to the extent permitted by law, the Articles of Association
of the Bank and the By-Laws, shall have and may exercise the
<PAGE>
EXHIBIT 4
powers of the Board of Directors in the management of the business and affairs
of the Bank.
Unless otherwise provided by the Board of Directors, a majority of the
members of any committee appointed by the Board of Directors pursuant to this
Section shall constitute a quorum at any meeting thereof and the act of a
majority of the members present at a meeting at which a quorum is present shall
be the act of such committee. Any such committee shall, subject to any rules
prescribed by the Board of Directors, prescribe its own rules for calling,
giving notice of and holding meetings and its method of procedure at such
meetings and shall keep a written record of all action taken by it. Each
committee shall keep regular minutes of its meetings and report the same to the
Board of Directors when required.
SECTION 14. Honorary Directors. Any person who has at any time been
-------------------
Chairman of the Board, President or Vice Chairman of the Board of the Bank may,
after retirement from the Board of Directors, be appointed by the Board of
Directors as an Honorary Director on a year-to-year basis. In no case shall an
Honorary Director serve as such for more than five years. Honorary Directors
shall serve in an advisory capacity to the Board of Directors, shall have no
vote and shall not be considered directors for the purpose of determining a
quorum. Honorary Directors shall be reimbursed for their expenses in attending
meetings of the Board of Directors and shall receive such fees, if any, for
attendance at each meeting of the Board of Directors as may be fixed from time
to time by the Board of Directors but shall not receive any other directors'
fees or any other compensation for their services.
ARTICLE IV
----------
OFFICERS
--------
SECTION 1. Officer Titles. The officers of the Bank shall include a
---------------
Chairman of the Board and a President and may include one or more Vice Chairmen
of the Board, Executive Vice Presidents, Senior Vice Presidents, First Vice
Presidents, Vice Presidents and Assistant Vice Presidents, a General Auditor, a
General Counsel, a Cashier, and such other officers as may be appropriate for
the prompt and orderly transaction of the business of the Bank. Individuals
appointed as Chairman of the Board, President and Vice Chairman of the Board
must be members of the Board. The same person may hold any two or more offices.
The Chairman of the Board or the President shall have such authority to
establish officer titles as from time to time delegated by the Board of
Directors and to delegate such authority further to other officers of the Bank.
SECTION 2. Executive Management. The Chairman of the Board or the
---------------------
President, as determined by the Board of Directors, shall be the chief executive
officer of the Bank. In case of the death or disability of the Chairman of the
Board, his powers shall be exercised and his duties discharged by the President.
In the event of the death or disability of the Chairman of the Board and the
President, the Vice Chairman of the Board (or in the event there be more than
one Vice Chairman of the Board, the Vice Chairmen of the Board in the order
designated, or in the absence of any designation, then in the order of their
election) shall exercise the powers and discharge the duties of the Chairman of
the Board.
<PAGE>
EXHIBIT 4
SECTION 3. Election of Officers. The Board of Directors of the Bank
--------------------
shall have authority to appoint the officers of the Bank. The Chairman of the
Board or the President shall have such authority to appoint officers as from
time to time delegated by the Board of Directors, and to delegate such authority
further to other officers of the Bank.
SECTION 4. Authority and Responsibility. The authorities and
-----------------------------
responsibilities of all officers, in addition to those specifically prescribed
herein, shall be those usually pertaining to their respective offices, or as may
be designated by the Board of Directors or by the Chairman of the Board or by
the President, or by any officer of the Bank designated by one of the foregoing.
SECTION 5. Term of Office. Officers shall be appointed for an indefinite
---------------
term, and their employment may be terminated or they may be removed from office
at any time. The Board of Directors shall have authority to terminate or remove
officers of the Bank. The Chairman of the Board or the President shall have
such authority to terminate or remove officers as from time to time delegated by
the Board of Directors, and to delegate such authority further to other officers
of the Bank.
SECTION 6. Surety. All officers and employees of the Bank who shall be
-------
responsible for any moneys, funds or valuables of the Bank shall give bond, or
be covered by a blanket bond, in such penal sum and with such security as shall
be approved by the Board, conditioned for the faithful and honest discharge of
their duties as such officers or employees and that they will faithfully apply
and account for all such moneys, funds and valuables and deliver the same on
proper demand to the order of the Board of the Bank, or to the person or persons
authorized to receive the same.
ARTICLE V
---------
SEAL
----
SECTION 1. Description. The following is a description of the Seal
------------
adopted by the Board of the Bank:
Female with left arm resting on shield, bale of goods and sheaf of grain
at her side, ship and sea in the distance; the whole surrounded with the words,
"BANK ONE, NATIONAL ASSOCIATION".
SECTION 2. Attestation. Any instrument which is executed for and on
------------
behalf of the Bank by its duly authorized officers may, when necessary, be
attested and sealed with the corporate seal by any officer of the Bank other
than the officer who executes such instrument on behalf of the Bank.
<PAGE>
EXHIBIT 4
ARTICLE VI
----------
TRANSFERS OF REAL ESTATE
------------------------
Any Vice President or higher ranking officer shall have authority on
behalf of and in the name of the Bank, to execute any document or instrument and
to take action which may be necessary or appropriate to purchase, convey, lease,
or otherwise affect any real estate or interest in real estate owned or to be
owned by the Bank; provided, however, any document or instrument purchasing,
conveying or leasing real estate used or to be used by the Bank as banking
facilities must be executed by a Senior Vice President or higher ranking
officer, or any other officer designated by any of the foregoing. Any Assistant
Vice President or higher ranking officer shall have authority to execute and
deliver on behalf of and in the name of the Bank, releases of mortgages or trust
deeds.
ARTICLE VII
-----------
STOCK AND STOCK CERTIFICATES
----------------------------
SECTION 1. Increase of Stock. In the event of any increase in the
------------------
capital stock of the Bank the preemptive rights of the shareholders in respect
of any such increased stock shall be as set forth in Article FIFTH of the
Articles of Association.
Any warrants or certificates issuable to shareholders in connection with
any increase of the capital stock of the Bank, shall be delivered to the
respective shareholders entitled thereto, either by hand or by mail, first-class
postage prepaid, addressed to their respective addresses as shown on the books
of the Bank.
If, in the event of a sale of additional shares, any subscription rights
shall not have been exercised at the expiration of the specified subscription
period, such unsubscribed new shares may be issued and sold at such price, not
less than the par value thereof, to such persons and on such terms as the Board
of Directors may determine.
SECTION 2. Transfers of Stock. The stock of the Bank shall be assignable
-------------------
only upon the books of the Bank, subject to the restrictions of the Act, and a
transfer book shall be kept in which all assignments and transfers of stock
shall be made. Transfers of stock may be suspended preparatory to any election
or payment of any dividends.
SECTION 3. Certificates of Stock. Certificates of stock signed by any
----------------------
Vice President or higher ranking officer and the Cashier or any Assistant
Cashier may be issued to shareholders, and the Certificates shall state upon the
face thereof that the stock is transferable only upon the books of the Bank. If
such Certificates are manually countersigned by two other officers of the Bank,
the signatures of the officers designated in the preceding sentence may be
facsimiles, engraved or printed. In case any officer who has signed or whose
facsimile signature has been placed upon such Certificates shall have ceased to
be such officer before such Certificates are issued, they may be issued by the
Bank with the same effect as if such officer had not ceased to be such at the
date of issue.
In case of transfer of stock, new Certificates of stock shall not be
issued until other Certificate or Certificates of stock of an equal amount shall
first have been surrendered and cancelled.
<PAGE>
EXHIBIT 4
Any one of the following officers of the Bank: the Chairman of the Board,
the President, or any Vice Chairman of the Board is each hereby authorized to
cause new Certificates of stock of the Bank to be issued to replace Certificates
reported to have been lost, stolen or destroyed, upon receipt of: (a)
appropriate affidavit or affidavits setting forth whether the Certificates were
lost, stolen or destroyed and the circumstances thereof, and (b) a bond or bonds
(blanket or otherwise) or an agreement or agreements of indemnity, sufficient in
the opinion of any of such officers to protect the interests of the Bank issuing
such new Certificates.
ARTICLE VIII
------------
BANKING HOURS
-------------
The Bank shall be open for business during such days of the year and for
such hours as the Board of Directors or any officer of the Bank designated by
the Board of Directors may from time to time determine.
ARTICLE IX
----------
CONTRACTS, CERTIFICATES OF DEPOSIT AND NOTES
--------------------------------------------
SECTION 1. Execution of Contracts. Any officer of the bank and such
-----------------------
other persons as may be authorized by the Board of Directors are severally and
respectively authorized to execute documents and to take action in the Bank's
name in connection with any and all transactions conducted in the ordinary
course of business of the Bank.
SECTION 2. Certificates of Deposit and Notes. Notwithstanding the
----------------------------------
foregoing, all certificates of deposits and notes evidencing obligations of the
Bank shall be signed either manually or by facsimile signature by any officer of
the Bank, and, if such signature is not a manual signature, shall be validated
by the manual signature of another officer of the Bank whose signature does not
already appear on said certificate of deposit or note or by the authorized
officers of corporate fiduciaries or agents with whom the Board of Directors may
from time to time by resolution authorize the officers of the Bank to contract
for services in connection with the validation and delivery of certificates of
deposit or notes issued by the Bank.
ARTICLE X
---------
VOTING RIGHTS
-------------
The vote of the Bank as stockholder in any corporation in which it may
hold stock or upon any securities carrying voting rights which it shall have the
right to vote in its individual capacity as
<PAGE>
EXHIBIT 4
a Bank, shall be cast at any stockholders' or shareholders' meeting by any Vice
President or higher ranking officer, or the Cashier, in person, or by some
person or persons authorized by written proxy signed by one of said officers.
In all cases where shares of stock or other securities carrying voting
rights and owned by the Bank shall be held in the name of a nominee of the Bank,
any Vice President or higher ranking officer, or the Cashier, may authorize such
nominee to vote such stock or other securities in person, either unconditionally
or upon such terms, limitations, or conditions as such officer may direct, or
any such officer may authorize such nominee to execute a proxy to vote such
shares of stock or other securities carrying voting rights, either
unconditionally or upon such terms, conditions and/or limitations as such
officer shall approve.
ARTICLE XI
----------
EXAMINATIONS
------------
It shall be the duty of the Auditor to examine, from time to time, the
various operations of the Bank, verify its assets and liabilities, and perform
such other procedures as are required to determine that the accounting records
are accurate and to ascertain whether the Bank is in a sound and solvent
condition. Major discrepancies and defalcations shall be reported to the Board
promptly and other reports shall be made directly to the Board when deemed
appropriate either by the Auditor or the Board. In the event of the death,
resignation, absence or inability of the Auditor, the Board of Directors shall
appoint a competent person who shall make such examinations and reports, pending
the election of a successor to the Auditor or the return of the Auditor to his
duties.
ARTICLE XII
-----------
BONDS OF INDEMNITY
------------------
Bonds of indemnity given to secure the issuance of duplicate or substitute
notes, bonds, stock certificates, checks, debentures or other securities which
may have been lost, destroyed or stolen or to secure the payment of any such
lost, destroyed or stolen securities or to secure the payment by the Bank of
funds deposited by any public authorities, shall be executed by any Assistant
Vice President or higher ranking officer, and, if required, sealed with the
corporate seal and attested by some other officer of the Bank.
ARTICLE XIII
------------
AUTHORITY TO SELL STOCKS, BONDS, ETC.
-------------------------------------
SECTION 1. U.S. Obligations. Any Assistant Vice President or higher
-----------------
ranking officer may at any time, in his discretion, sell, assign and transfer
any and all United States bonds now standing, or which may hereafter stand, in
the name of the Bank, and to appoint one or more attorneys for that purpose.
<PAGE>
EXHIBIT 4
SECTION 2. Other Obligations. Any Assistant Vice President or higher
------------------
ranking officer may at any time, in his discretion, sell, assign and transfer
any and all notes, bonds, certificates of indebtedness or obligations of any
corporation, firm or individual, which said notes, bonds, certificates of
indebtedness or obligations are now registered, or may hereafter be registered,
in the name of, or for the benefit of, the Bank, or are payable or indorsed to
the Bank.
SECTION 3. Stock. Any Assistant Vice President or higher ranking officer
------
may at any time in his discretion, sell, assign and transfer to any assignee or
transferee, for and on behalf of the Bank and in its name, any and all shares of
capital stock of any corporation or corporations held by the Bank.
ARTICLE XIV
-----------
FIDUCIARY ACTIVITIES
--------------------
1. Authority to Sign as Registrar, Transfer Agent, etc. Any officer of
---------------------------------------------------
the Bank shall have the right to sign, countersign, certify, register,
authenticate and identify all bonds, notes, interim certificates, and depositary
receipts, warrants, participation certificates, certificates of stock and
similar instruments for or in respect of which the Bank may be acting as
Trustee, Registrar, Transfer Agent or otherwise.
2. Authority to Vote Stock. The vote of the Bank as stockholder in any
-----------------------
corporation or mutual fund in which it may hold capital stock in any fiduciary
capacity, unless the governing instrument directs otherwise, may be voted by any
officer of the Bank in person, electronically or by written proxy signed by one
of said officers.
3. Authority to Sell, Assign and Transfer Stocks, etc. Any officer of
---------------------------------------------------
the Bank may sell, assign and transfer to any assignee or transferee for the
Bank and in its name, any and all shares of the capital stock or other
securities and obligations of any individual or entity held by the Bank in any
fiduciary capacity, and sign and deliver any instruments with respect to any
such items.
4. Authority to Sign Checks and Other Instruments. Any officer of the
----------------------------------------------
Bank is authorized to sign for and on behalf of the Bank: checks against any
account or accounts of any organizational unit of the Bank exercising fiduciary
powers; petitions; schedules; accounts; reports; receipts for funds or
securities deposited with the Bank as fiduciary and all instruments or documents
that may be necessary or desirable in connection with the execution of any
fiduciary powers of the Bank.
5. Delegation of Authority. Anything in this Article XIV to the contrary
-----------------------
notwithstanding, the Chairman of the Board or President is authorized to
designate in writing such persons as shall be authorized in the name of the Bank
to sign or countersign any or all of the documents and instruments enumerated in
this Article XIV relating to transactions conducted in connection with the
execution of any fiduciary powers of the Bank.
<PAGE>
EXHIBIT 4
ARTICLE XV
----------
AMENDMENT OF BY-LAWS
--------------------
These By-Laws may be changed or amended by the vote of a majority of the
directors present at any regularly constituted meeting of the Board of
Directors.
ARTICLE XVI
-----------
EMERGENCY OPERATION OF BANK
---------------------------
In the event of an emergency declared by the President of the United
States or the person performing his functions, due to threatened or actual enemy
attack or disaster, the officers and employees of the Bank will continue to
conduct the affairs of the Bank under such guidance from the directors as may be
available, except as to matters which by statute require specific approval of
the Board of Directors, and subject to conformance with any governmental
directives during the emergency.
ARTICLE XVII
------------
DELEGATION OF AUTHORITY
-----------------------
Each of the Chairman of the Board, the President, any Vice Chairman of the
Board and the Cashier of the Bank are severally and respectively authorized to
designate in writing such persons who shall be authorized in the name and on
behalf of the Bank to sign any document or instrument, including certificates of
deposit and notes, and to take action which may be necessary or appropriate to
the conduct of the Bank's business, in its individual capacity or any other
capacity. Any such authorization to sign such document or instrument and to
take any action may be general or limited as is determined in the discretion of
the Chairman of the Board, the President, any Vice Chairman of the Board or the
Cashier.
<PAGE>
EXHIBIT 6
THE CONSENT OF THE TRUSTEE REQUIRED
BY SECTION 321(B) OF THE ACT
September 27, 1999
Securities and Exchange Commission
Washington, D. C. 20549
Gentlemen:
In connection with the qualification of an indenture between Headlands Home
Equity Loan Trust 1999-1 and Bank One, National Association, the undersigned, in
accordance with Section 321(b) of the Trust Indenture Act of 1939, as amended,
hereby consents that the reports of examinations of the undersigned, made by
Federal or State Authorities authorized to make such examinations, may be
furnished by such authorities to the Securities and Exchange Commission upon its
request therefor.
Very truly yours,
Bank One, National Association
By: /s/ Steven M. Wagner
--------------------------------
Steven M. Wagner
First Vice President
<PAGE>
EXHIBIT 7
A copy of the latest report of condition of the trustee published pursuant
to law or the requirements of its supervising or examining authority.
<PAGE>
EXHIBIT 7
<TABLE>
<S> <C> <C>
Legal Title of Bank: Bank One, National Association Call Date: 06/30/99 ST-BK: 17-1630 FFIEC 031
Address: 1 Bank One Plaza, Ste IL1-0460 Page RC-1
City, State Zip: Chicago, IL 60670
FDIC Certificate No.: 0/3/6/1/8
---------
</TABLE>
Consolidated Report of Condition for Insured Commercial
and State-Chartered Savings Banks for June 30, 1999
All schedules are to be reported in thousands of dollars. Unless otherwise
indicated, report the amount
outstanding of the last business day of the quarter.
Schedule RC--Balance Sheet
<TABLE>
<CAPTION>
Dollar Amounts in thousands C400
----
RCFD BIL MIL THOU
---- ------------
<S> <C> <C> <C>
ASSETS
1. Cash and balances due from depository institutions
(from Schedule RC-A): RCFD
----
a. Noninterest-bearing balances and currency
and coin(1).......................................... 0081 3,983,167 1.a
b. Interest-bearing balances(2)...................... 0071 3,924,307 1.b
2. Securities
a. Held-to-maturity securities(from Schedule
RC-B, column A)...................................... 1754 0 2.a
b. Available-for-sale securities (from Schedule
RC-B, column D)...................................... 1773 12,582,363 2.b
3. Federal funds sold and securities purchased under
agreements to resell................................. 1350 7,578,668 3.
4. Loans and lease financing receivables: RCFD
----
a. Loans and leases, net of unearned income
(from Schedule RC-C)................................. 2122 40,676,052 4.a
b. LESS: Allowance for loan and lease losses......... 3123 458,781 4.b
c. LESS: Allocated transfer risk reserve............. 3128 4,342 4.c
d. Loans and leases, net of unearned income,
allowance, and reserve (item 4.a minus 4.b
and 4.c)............................................. 2125 40,212,929 4.d
RCFD
----
5. Trading assets (from Schedule RD-D).................. 3545 4,484,022 5.
6. Premises and fixed assets (including capitalized
leases).............................................. 2145 724,662 6.
7. Other real estate owned (from Schedule RC-M)......... 2150 2,270 7.
8. Investments in unconsolidated subsidiaries and
associated companies (from Schedule RC-M)............ 2130 207,442 8.
9. Customers' liability to this bank on acceptances
outstanding.......................................... 2155 300,112 9.
10. Intangible assets (from Schedule RC-M)............... 2143 232,947 10.
11. Other assets (from Schedule RC-F).................... 2160 2,513,151 11.
12. Total assets (sum of items 1 through 11)............. 2170 76,746,040 12.
- -----------------
</TABLE>
(1) Includes cash items in process of collection and unposted debits.
(2) Includes time certificates of deposit not held for trading.
<PAGE>
<TABLE>
<S> <C> <C>
Legal Title of Bank: Bank One, National Association Call Date: 06/30/99 ST-BK: 17-1630 FFIEC 031
Address: 1 Bank One Plaza, Ste IL1-0460 Page RC-2
City, State Zip: Chicago, IL 60670
FDIC Certificate No.: 0/3/6/1/8
---------
Schedule RC-Continued
Dollar Amounts in
Thousands
------------------
LIABILITIES
13. Deposits:
a. In domestic offices (sum of totals of columns A and C RCON
----
from Schedule RC-E, part 1) ................................... 2200 22,391,381 13.a
(1) Noninterest-bearing(1) ................................... 6631 10,239,312 13.a1
(2) Interest-bearing ......................................... 6636 12,152,069 13.a2
b. In foreign offices, Edge and Agreement subsidiaries, and RCFN
----
IBFs (from Schedule RC-E, part II) ............................ 2200 23,013,949 13.b
(1) Noninterest bearing ....................................... 6631 361,838 13.b1
(2) Interest-bearing .......................................... 6636 22,652,111 13.b2
14. Federal funds purchased and securities sold under agreements
to repurchase: RCFD 2800 6,919,979 14
15. a. Demand notes issued to the U.S. Treasury RCON 2840 362,951 15.a
b. Trading Liabilities(from Schedule RC-D) ..................... RCFD 3548 4,548,086 15.b
16. Other borrowed money: RCFD
----
a. With original maturity of one year or less .................... 2332 9,453,587 16.a
b. With original maturity of more than one year ................. A547 104,900 16.b
c. With original maturity of more than three years .............. A548 343,059 16.c
17. Not applicable
18. Bank's liability on acceptance executed and outstanding ........... 2920 300,112 18.
19. Subordinated notes and debentures ................................. 3200 2,750,000 19.
20. Other liabilities (from Schedule RC-G) ............................ 2930 1,361,700 20.
21. Total liabilities (sum of items 13 through 20) .................... 2948 71,549,704 21.
22. Not applicable
EQUITY CAPITAL
23. Perpetual preferred stock and related surplus ..................... 3838 0 23.
24. Common stock ...................................................... 3230 200,858 24.
25. Surplus (exclude all surplus related to preferred stock) .......... 3839 3,245,088 25.
26. a. Undivided profits and capital reserves ......................... 3632 1,872,884 26.a
b. Net unrealized holding gains (losses) on available-for-sale
securities ..................................................... 8434 (121,259) 26.b
c. Accumulated net gains (losses) on cash flow hedges............. 4336 0 26.c
27. Cumulative foreign currency translation adjustments................ 3284 (1,235) 27.
28. Total equity capital (sum of items 23 through 27).................. 3210 5,196,336 28.
29. Total liabilities, limited-life preferred stock, and equity
capital (sum of items 21, 22, and 28) ............................. 3300 76,746,040 29.
Memorandum
To be reported only with the March Report of Condition.
1. Indicate in the box at the right the number of the statement below that best describes the most
comprehensive level of auditing work performed for the bank by independent external ------------ Number
auditors as of any date during 1996 ....................... RCFD 6724 ...... N/A M.1.
------------
1 = Independent audit of the bank conducted in accordance 4 = Directors' examination of the bank performed by other
with generally accepted auditing standards by a certified external auditors (may be required by state chartering
public accounting firm which submits a report on the bank authority)
2 = Independent audit of the bank's parent holding company 5 = Review of the bank's financial statements by external
conducted in accordance with generally accepted auditing auditors
standards by a certified public accounting firm which 6 = Compilation of the bank's financial statements by external
submits a report on the consolidated holding company auditors
(but not on the bank separately) 7 = Other audit procedures (excluding tax preparation work)
3 = Directors' examination of the bank conducted in 8 = No external audit work
accordance with generally accepted auditing standards
by a certified public accounting firm (may be required by
state chartering authority)
</TABLE>
- ------------
(1) Includes total demand deposits and noninterest-bearing time and savings
deposits.
