SECURITIES & EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT PURSUANT
TO SECTION 13 OF 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
September 26, 1996
Date of Report (Date of earliest event reported)
Ray Ellison Mortgage Acceptance Corp.
(exact name of registrant as specified in its charter)
Texas 33-76642 74-2337351
State or other jurisdiction Commission I.R.S. Employer
of incorporation File No. ID Number
70 NE Loop 410, Suite 545, San Antonio, Texas 78216
(Address of Principal Executive Offices)
Registrant's telephone number, including area code:
(210) 342-1085
P.O. Box 5250, 4800 Fredericksburg Road, San Antonio, Texas 78201
(Former Address, if Changed since last Report)
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 8-K
Item 2(a)
Purchase of GNMA certificates on September 26, 1996, in the amount of
$8,692,794.62 from REMIC Mortgage, Inc. Funds were generated through the
issuance of Ray Ellison Mortgage Acceptance Corp. 7.10% GNMA-Collateralized
Bonds Series 1996C, due September 30, 2027, as follows:
<TABLE>
<CAPTION>
Source of Funds:
<S> <C>
Bonds Issued $ 9,000,000.00
Underwriting Expenses and Commission (315,000.00)
Advance from Affiliated Company 7,794.62
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$ 8,692,794.62
================
Application of Funds:
Purchase of GNMA Certificates $ 8,692,794.62
================
</TABLE>
See also the enclosed Ray Ellison Mortgage Acceptance Corp., Issuer, and The
Bank of New York, Trustee, Series 1996C Supplement dated September 30, 1996, to
the Indenture dated as of August 1, 1992.
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
RAY ELLISON MORTGAGE ACCEPTANCE CORP.
/s/ LOCKSLEY SIMMONS
Vice President and Treasurer
Date: September 26, 1996
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Exhibit Index
EX-4.1 Series 1996C Supplement dated as of September 26, 1996 to Indenture dated
as of August 1, 1992 between Ray Ellison Mortgage Acceptance Corp., Issuer,
and The Bank of New York, Trustee.
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RAY ELLISON MORTGAGE ACCEPTANCE CORP.
Issuer,
and
THE BANK OF NEW YORK
Trustee,
---------------------------
SERIES 1996C SUPPLEMENT
Dated as of September 26, 1996
to
INDENTURE
Dated as of August 1, 1992,
and amended through the date hereof
---------------------------
7.10% GNMA-COLLATERALIZED BONDS
SERIES 1996C, DUE SEPTEMBER 30, 2027
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<TABLE>
TABLE OF CONTENTS
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Page
<S> <C>
PRELIMINARY STATEMENT...................................................................................1
GRANTING CLAUSES........................................................................................1
Section 1. Certain Defined Terms............................................ ...........2
Section 2. Designation..................................................................2
Section 3. Payment Date.................................................................3
Section 4. Accounting Date..............................................................3
Section 5. Regular Record Date..........................................................3
Section 6. Form of Bond.................................................................3
Section 7. Aggregate Principal Amount...................................................3
Section 8. Bond Interest Rate...........................................................3
Section 9. Stated Maturity..............................................................3
Section 10. Reserve Fund.................................................................3
Section 11. Requisite Amount of Reserve Fund.............................................3
Section 12. Redemption Date..............................................................4
Section 13. Mandatory Redemptions........................................................4
Section 14. Redemption at the Option of the Issuer; Issuer Redemption Date...............4
Section 15. Notice of Redemption by Trustee Following
Book Entry Termination....................................................4
Section 16. First Interest Accrual Date; First Interest Period...........................4
Section 17. Deposit of First Due Date Receipts in Collection Account;
Capitalized First Payment Date Deposit....................................5
Section 18. Denominations of Bonds.......................................................5
Section 19. Maintenance of the Trust Estate by the Trustee...............................5
Section 20. Payment of Principal and Interest; Book Entry Procedures.....................5
Section 21. Transfer of Bonds............................................................8
Section 22. Substitutions................................................................8
Section 23. Accounting by the Issuer and Reports by Independent Accountants..............9
Section 24. Expense Fund Amount..........................................................9
Section 25. Modification and Ratification of Indenture...................................9
Section 26. Counterparts.................................................................9
Section 27. GOVERNING LAW...............................................................10
</TABLE>
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SERIES 1996C SUPPLEMENT dated as of September 26, 1996, between RAY
ELLISON MORTGAGE ACCEPTANCE CORP., a Texas corporation (together with its
successor as provided in the Indenture referred to in this sentence, the
"Issuer"), and The Bank of New York, as trustee (together with its successor as
provided in the Indenture referred to in this sentence, the "Trustee") under an
Indenture dated as of August 1, 1992, as amended through the date hereof, and as
amended hereby (the "Indenture").
PRELIMINARY STATEMENT
Section 2.03 of the Indenture provides, among other things, that the
Issuer and the Trustee may at any time and from time to time enter into an
indenture supplemental to the Indenture for the purpose of authorizing a Series
of Bonds and to specify certain terms of each Series of Bonds. The Board of
Directors, or a duly appointed committee thereof, of the Issuer has duly
authorized the creation of a Series of Bonds with an aggregate principal amount
of $9,000,000 to be known as the 7.10% GNMA-Collateralized Bonds, Series 1996C,
due September 30, 2027 (the "Bonds"), and the Issuer and the Trustee are
executing and delivering this Series 1996C Supplement in order to provide for
the Bonds.
GRANTING CLAUSES
The Issuer hereby Grants to the Trustee, in trust and as collateral
security as provided in the Indenture, for the exclusive benefit of the Holders
of the Bonds, all of the Issuer's right, title and interest in and to any and
all benefits accruing to the Issuer from (a) the GNMA Certificates listed in
Schedule A to this Series 1996C Supplement which the Issuer is causing to be
delivered to the Trustee herewith and all amounts payable at any time after
September 26, 1996 to the holders of such GNMA Certificates, together with all
other GNMA Certificates as may, from time to time, be deposited with the Trustee
to secure the Bonds, in accordance with the Indenture or the Series 1996C
Supplement, (b) all moneys or instruments now or hereafter on deposit in, and
all sums, including, without limitation, interest, due or to become due, on the
Reserve Fund for the Bonds, and all present and future claims, demands, causes
and chooses in action, choate and inchoate, and suits arising under or in
connection with the Reserve Fund for the Bonds, (c) all moneys or instruments
now or hereafter on deposit in, and all sums, including, without limitation,
interest, due or to become due on, the Collection Account for the Bonds, and all
present and future claims, demands, causes and chooses in action, choate and
inchoate, and suits arising under or in connection with the Collection Account
for the Bonds, (d) all moneys or instruments now or hereafter on deposit in, and
all sums, including, without limitation, interest, due or to become due on, the
Redemption Fund for the Bonds, and all present and future claims, demands,
causes and chooses in action, choate and inchoate, and suits arising under or in
connection with the Redemption Fund for the Bonds, (e) all present and future
accounts, contract rights, goods, letters of credit, general cash and non-cash
proceeds, and other rights arising from or by virtue of, the disposition of, or
collections with respect to, or insurance proceeds payable with respect to, or
claims against other persons with respect to, all or any part of the foregoing,
and (f) all proceeds, of every kind and nature whatsoever, including, without
limitation, proceeds of proceeds, and the conversion, voluntary or involuntary,
of any of the foregoing into cash or other liquidated property, to secure the
Bonds equally and ratably without prejudice, priority or distinction between any
Bond and any other Bond by reason of difference in time of issuance or
otherwise, and to secure the payment of the principal of, and interest on, the
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Bonds in accordance with their terms, all of the sums payable under the
Indenture or this Series 1996C Supplement with respect to the Bonds and
compliance with the provisions of the Indenture and this Series 1996C Supplement
with respect to the Bonds, all as provided in the Indenture and this Series
1996C Supplement.
Section 1. Certain Defined Terms. All terms used in this Series 1996C
Supplement which are defined in the Indenture, either directly or by reference
therein, have the meanings assigned to them therein, except to the extent such
terms are defined otherwise in this Series 1996C Supplement or the context
clearly requires otherwise. With respect to the Bonds, the following provisions
shall govern the defined terms set forth below:
"Applicable Overcollateralization Amount": As defined in Article One
of the Indenture.
"Book Entry Bonds": Unless an event resulting in Book Entry Termination
(as described in this Section 1 and Section 2.15 of the Indenture) shall occur,
the Bonds shall be Book Entry Bonds for which ownership and transfers of
beneficial ownership interests shall be made through book entries by the
Clearing Agency as described in Section 21 hereof; provided, that after Book
Entry Termination, Definitive Bonds shall, after execution and delivery of a
supplemental indenture containing any provisions which in the opinion of the
Trustee and the Issuer are necessary for such purpose, be issued to the
Beneficial Owners of Bonds Outstanding at the time of such Book Entry
Termination, and such Bonds shall no longer be "Book Entry Bonds."
"Expense Fund Amount": As defined in Section 24 hereof.
"Clearing Agency": The registered Holder of the single Bond evidencing
the Bonds, initially issued as Book Entry Bonds. The initial Clearing Agency
with respect to the Bonds shall be The Depository Trust Company, the nominee for
which is CEDE & CO.
"Letter Agreement": The Letter of Representations to The Depository
Trust Company from the Trustee and the Issuer dated September 26, 1996, attached
hereto as Exhibit C and incorporated herein by reference.
"Maximum GNMA Collateral Value Percentage": At any date on which the
Reserve Fund is not funded and the Issuer has GNMA Certificates on deposit with
the Trustee to secure the Bonds in lieu of funding the Reserve Fund, the Maximum
GNMA Collateral Value Percentage shall be 99.418%.
"Rating Agency": Standard & Poor's Ratings Group.
"Trust Estate": The Trust Estate securing the Bonds described in the
Granting Clauses of this Series 1996C Supplement.
Section 2. Designation. The Bonds shall be designated as the
"7.10% GNMA-Collateralized Bonds, Series 1996C."
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Section 3. Payment Date. With respect to the Bonds, the last day of each month
commencing with November 30, 1996 (or if the last day of any month is not a
Business Day, the Business Day immediately following) shall be a "Payment
Date" for all purposes of the Indenture
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and this Series 1996C Supplement, and the Accrual Period for each Payment Date
shall be the calendar month preceding the month in which such Payment Date
occurs (except that the initial Accrual Period shall be the period from the date
of this Series 1996C Supplement through the last day of the calendar month
preceding the month in which the initial Payment Date occurs).
Section 4. Accounting Date. The twelfth Business Day of each calendar
month, commencing in October 1996, shall be an "Accounting Date" for all
purposes of the Indenture.
Section 5. Regular Record Date. The last Business Day of the month
preceding the month in which each Payment Date or Redemption Date, as the case
may be, occurs shall be the "Regular Record Date" for such Payment Date,
Redemption Date or Optional Redemption Date for all purposes of the Indenture.
Section 6. Form of Bond. The form of each Bond shall be the
form of bond set forth in Exhibit A attached hereto.
Section 7. Aggregate Principal Amount. The aggregate principal amount
of the Bonds that may be authenticated and delivered under this Series 1996C
Supplement is limited to $9,000,000, which shall be evidenced by a single
certificate registered in the name of "CEDE & CO.", the nominee for the Clearing
Agency. In the event of a Book Entry Termination, Definitive Bonds shall be
authenticated and delivered in the aggregate principal amount of the Bonds then
outstanding, and thereafter, Bonds will be authenticated and delivered upon
registration of transfer of, or in exchange for, or in lieu of, other Bonds
pursuant to Section 2.06, 2.07, 2.08, 8.06, 9.02 or 9.11 of the Indenture or
upon Book Entry Termination as provided in Section 2.15 of the Indenture.
Section 8. Bond Interest Rate. The Bonds shall bear interest
at the rate of 7.10% per annum (the "Bond Rate").
Section 9. Stated Maturity. The Stated Maturity of the Bonds shall
be September 30, 2027.
Section 10. Reserve Fund. Notwithstanding Section 2.12(7) of the
Indenture, the Reserve Fund for the Bonds shall initially be $0. The Issuer may,
at any time, elect to fund the Reserve Fund by depositing with the Trustee
either: (a) cash, (b) a Qualified Letter of Credit, which Qualified Letter of
Credit must satisfy the requirements of item (7)(B) of Section 2.12 of the
Indenture (a form of Qualified Letter of Credit is attached hereto as Exhibit
B), (c) a Qualified Surety Bond, or (d) a combination of cash and (i) a
Qualified Letter of Credit or (ii) a Qualified Surety Bond, in any case such
Qualified Letter of Credit, Qualified Surety Bond, cash or combination thereof
shall be in an aggregate amount at least equal to the Requisite Amount of the
Reserve Fund at such time.
Section 11. Requisite Amount of Reserve Fund. With respect to the
Bonds, at any time when the Reserve Fund is funded as described in Section 10,
the "Requisite Amount of Reserve Fund" shall be 0.5917% of the aggregate
principal amount of the Bonds then Outstanding.
Section 12. Redemption Date. With respect to the Bonds, the last day
of each month commencing with October 31, 1996 (or if the last day of the month
is not a Business Day, the
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Business Day immediately following) shall be a "Redemption Date" for purposes of
Sections 9.01 and 9.04 of the Indenture.
Section 13. Mandatory Redemptions. On or before the twelfth Business
Day of each month, commencing in October 1996, the Trustee will notify the
Clearing Agency to determine the amount of Bonds for which requests for
redemption by Bondholders have been accepted to determine the principal amount
of Bonds, if any, which will be subject to Mandatory Redemption on such
Redemption Date. If the Trustee determines that a Mandatory Redemption is
necessary, a Mandatory Redemption will be conducted as provided in accordance
with the Clearing Agency procedures outlined in the Letter Agreement attached
hereto as Exhibit C. In the event of Book Entry Termination, the Trustee will
select by random lot Bonds to be redeemed by mandatory redemption.
Section 14. Redemption at the Option of the Issuer; Issuer
Redemption Date.
(a) The Issuer at its option may, on any Redemption Date (i) prior to
the fourth anniversary of their issuance, if the aggregate principal amount of
the Bonds then outstanding declines to 20% or less of their original aggregate
principal amount, and (ii) at any time on or after the fourth anniversary of
their issuance (any such Redemption Date being so designated in accordance with
Section 9.05 of the Indenture to be an "Optional Redemption Date" for the
purposes of such Section), redeem all or a portion of the Bonds then
outstanding, as provided in Article IX of the Indenture and this Section.
(b) In the event of an optional redemption pursuant to this Section 14
and Section 9.05 of the Indenture, the Issuer shall notify the Trustee, in
accordance with the requirements of Section 9.08 of the Indenture, at least
twenty (20) days prior to the Optional Redemption Date on which the optional
redemption will be conducted. Following such notice from the Issuer, the Trustee
will notify the Clearing Agency (by certified mail) at least fifteen (15) days
prior to such Issuer Redemption Date.
Section 15. Notice of Redemption by Trustee Following Book Entry
Termination. In the event that a Book Entry Termination occurs hereunder, notice
of redemption at the option of the Issuer pursuant to Section 9.05 of the
Indenture, respectively, shall be given by first-class mail, postage prepaid,
and mailed not less than ten (10) days prior to the respective Optional
Redemption Date, as the case may be, to each Holder, as of the applicable
Regular Record Date, of the Bonds to be so redeemed, at the address of each such
Holder appearing in the Bond Register.
Section 16. First Interest Accrual Date; First Interest Period. It is
expressly understood that the Pre-Issue Due Date for each of the GNMA
Certificates granted hereunder shall be the day occurring in September 1996
which would be a due date for such GNMA Certificate if such GNMA Certificate
were issued and granted at a sufficiently early date. The First Interest Accrual
Date for the Bonds shall be September 26, 1996. The number of days for which
interest shall be payable, from such First Interest Accrual Date to the end of
the period for which interest is payable on the First Payment Date, shall be
thirty-five (35) days, and the interest then due on the Bonds will be
$62,125.00.
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Section 17. Deposit of First Due Date Receipts in Collection Account;
Capitalized First Payment Date Deposit. It is expressly understood and provided
that the Combined P&I to be due to be received on October 15, 1996 with respect
to GNMA I Certificates, or October 20, 1996 with respect to GNMA II
Certificates, Granted hereunder (the record date for determining the payee of
which is in May), shall, upon receipt, be deposited in the Collection Account
for the Bonds and transferred therefrom on October 31, 1996, first in accordance
with clauses (iv) and (v) of Section 7.06(d) of the Indenture and then in
accordance with Section 7.06(e) of the Indenture; provided, however, that such
transfer may be made at any earlier time in one or more installments upon
receipt of an Issuer Request therefor, each such installment to take into
account the previous installments, if any, in determining how much is to be
transferred to each specific location; and provided further that there shall in
any event remain in the Collection Account for the Bonds an amount equal to
$8,600.00 in lieu of the Issuer's making any deposit in the Collection Account
for the Bonds as the Capitalized First Payment Date Deposit required under
Section 2.12(10) of the Indenture.
Section 18. Denominations of Bonds. The Bonds are Book Entry Bonds
which shall be evidenced by a single Definitive Bond certificate representing
the entire aggregate principal amount of the Bonds as set forth in Section 7
hereof, beneficial ownership of which may be held in denominations of $1,000 and
integral multiples thereof. The Bonds shall initially be registered on the Bond
Register in the name of CEDE & CO., the nominee of the Clearing Agency. No
Beneficial Owner will receive a Definitive Bond representing such Beneficial
Owner's interest in the Bonds, except in the event of Book Entry Termination.
Section 19. Maintenance of the Trust Estate by the Trustee.
(a) The Trustee will maintain possession of the documents, certificates
and other instruments evidencing the assets comprising the Trust Estate within
the States of Texas and New York and will not cause such assets to lose their
separate identity or to be commingled or merged with any assets not comprising
the Trust Estate.
(b) The Trustee will maintain all cash held in the Collection Account,
Reserve Fund and/or Redemption Fund in trust accounts maintained with the
corporate trust department, rather than the commercial banking side, of the
Trustee.
Section 20. Payment of Principal and Interest; Book Entry Procedures.
(a) Interest on the current principal amount (before giving effect to
payments of principal due upon redemption on any Redemption Date which is also a
Payment Date) of each Outstanding Bond to be paid on any Payment Date shall be
the amount accrued thereon at the Bond Interest Rate for the related Accrual
Period and if such Payment Date is the Redemption Date (other than October 31,
1996) on which the Bond matures or is redeemed, an additional 30 days' interest
at the Bond Interest Rate on the entire or any portion of the principal amount
of the Bond so paid at maturity or redemption. If a Bond matures or is redeemed
on October 31, 1996, the holder of such Bond will receive 35 days' interest at
the Bond Interest Rate.
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(b) Each payment of principal of and interest on the Bonds shall be
paid by the Trustee to the Clearing Agency, which shall credit the amount of
such payments to the accounts of its Clearing Agency Participants in accordance
with its normal procedures. Each Clearing Agency Participant shall be
responsible for disbursing such payments to the Beneficial Owners of the Book
Entry Bonds that it represents and to each indirect participating brokerage firm
(a "brokerage firm" or "indirect participating firm") for which it acts as
agent. Each brokerage firm shall be responsible for disbursing funds to the
Beneficial Owners of the Book Entry Bonds that it represents. All such credits
and disbursements are to be made by the Clearing Agency and the Clearing Agency
Participants in accordance with the provisions of the Bonds. Except with respect
to the payment of principal of and interest on the Bonds to the Clearing Agency
or except as otherwise provided by law, neither the Trustee, the Bond Registrar
nor the Issuer shall have any responsibility for such payments described in this
subsection (b).
(c) Unless the Trustee has been notified otherwise by the Clearing
Agency to the contrary with respect to its rules and practices for the Book
Entry Bonds, the Trustee shall comply with (i) the provisions of the form of the
Bonds as set forth in Exhibit A hereto, (ii) the provisions of the Letter
Agreement as set forth in Exhibit C hereto, and (iii) the following additional
procedures relating to the Book Entry Bonds:
(a) The Trustee shall maintain a list of Deceased Holders of which the
Trustee has received notice and shall require a death certificate as evidence of
the holding of Book Entry Bonds by a Deceased Holder (it being understood that
all death certificates received by the Trustee with respect to requests for
redemption shall be presumed to be legally valid and further that the Trustee
not be under any duty, express or implied, to determine independently the
occurrence of the death of a Deceased Holder but may rely conclusively upon
documentation delivered to it pursuant to this subsection).
(b) In determining the Book Entry Bonds to be redeemed at the request
of Beneficial Owners pursuant to Section 9.01 of the Indenture on any Redemption
Date, the Trustee shall follow the order of the time-stamped requests for
redemption received by the Trustee from the Clearing Agency, subject to the
priorities set forth below (it being understood that the Trustee may rely
conclusively and be fully protected in relying upon the authenticity of such
requests for redemption and that the Trustee shall not be liable for any delay
in delivery of requests for redemption by the Clearing Agency or any Clearing
Agency Participant). For a request for redemption to be honored with respect to
a Redemption Date, it must be received by the Clearing Agency on a Tender Date
but not later than the last Tender Date of the month in which the Redemption
Date occurs.
(c) Section 9.01(b) of the Indenture shall be amended and restated to
provide that principal payments allocated to the Book Entry Bonds will be
allocated on the Redemption Date by the Trustee as follows: first, to Clearing
Agency Participants on behalf of Deceased Holders in the order that such
Deceased Holders' time-stamped requests for such redemption have been received
by the Clearing Agency until each Deceased Holder requesting redemption through
a Clearing Agency Participant has received an initial priority principal
distribution of up to $100,000 with respect to the Book Entry Bonds held by such
Deceased Holder; second, to Clearing Agency Participants on behalf of other
Beneficial Owners in the
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order that such Beneficial Owners' requests for redemption have been received
until each Beneficial Owner requesting redemption through a Clearing Agency
Participant has received an initial priority principal distribution of up to
$10,000 with respect to such Beneficial Owner's Book Entry Bonds; third, to
Clearing Agency Participants on behalf of Deceased Holders owning Bonds in
excess of such $100,000 limitation in the order that such time-stamped requests
for redemption have been received by the Clearing Agency and without limitation
as to the principal amount which may be so redeemed; and fourth, to Clearing
Agency Participants on behalf of other Beneficial Owners owning Bonds in excess
of $10,000 limitation in the order that such time-stamped requests for
redemption have been received by the Clearing Agency and without limitation as
to the principal amount which may be so redeemed.
(d) If any Bond, for which redemption was requested, is not redeemed on
the Redemption Date for which such request was initially submitted, a request
for redemption will remain in effect on each subsequent Redemption Date until
the subject Bonds have been redeemed or until written notice is submitted
withdrawing such request for redemption. In order to be effective for any
particular Redemption Date, a withdrawal notice must be received by the Trustee
on a Tender Date but not later than the last Tender Date of the month in which
the Redemption Date occurs.
(e) With respect to a Mandatory Redemption pursuant to Section 9.04 of
the Indenture and Section 13 hereof, on any Redemption Date, the Trustee shall
notify the Clearing Agency of the amount of such excess prior to the 10th
Business Day preceding the Redemption Date to the extent possible but in no
event later than the 18th calendar day of the month in which such Redemption
Date occurs. The Clearing Agency shall select Book Entry Bonds to be redeemed by
Mandatory Redemption by random lot in accordance with its rules, among the
Clearing Agency Participants, based upon the assumption that each Clearing
Agency Participant holds individual $1,000 Bonds aggregating the full principal
amount of that Clearing Agency Participant's holdings.
(f) Notwithstanding the second to the last sentence of Section 9.01(c)
of the Indenture, as soon as possible, the Trustee shall notify the Clearing
Agency and those Clearing Agency Participants whose requests for redemption are
to be honored in accordance with the priorities set forth in paragraph (c) of
this subsection. The notice shall include (A) the names of the Clearing Agency
Participants, indirect participating firms and Beneficial Owners (including
account numbers thereof if provided upon submission of the original redemption
requests to the Trustee) whose Book Entry Bonds are to be redeemed, (B) the
amount of each such Person's Book Entry Bonds to be redeemed and (C) the
aggregate amount of principal required to be paid on the Bonds on the related
Redemption Date. The notice must be received by the Clearing Agency seven (7)
Business Days prior to the related Redemption Date (or two (2) Business Days
prior to the related Redemption Date if electronic).
(g) The Bonds shall at all times, prior to Book Entry Termination, remain
registered in the name of the Clearing Agency or its nominee and at all times:
(A) registration of the Bonds may not be transferred by the Trustee or the Bond
Registrar
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except to another Clearing Agency; (B) the Clearing Agency shall maintain book
entry records with respect to the Clearing Agency Participants' ownership and
transfers of such Book Entry Bonds; (C) ownership and transfers of registration
of the Book Entry Bonds on the books of the Clearing Agency shall be governed by
applicable rules established by the Clearing Agency; (D) the Clearing Agency may
collect its usual and customary fees, charges and expenses from its Clearing
Agency Participants; and (E) the Trustee may rely and shall be fully protected
in relying upon information furnished by the Clearing Agency with respect to its
Clearing Agency Participants and furnished by the Clearing Agency Participants
with respect to indirect participating firms and their direct or indirect
Beneficial Owners.
(h) Whenever the vote or consent of the Holders of the Bonds is
solicited or may be given pursuant to the Indenture, the Clearing Agency shall
vote the percentage of the aggregate principal amount of the Bonds then
Outstanding and held by the Clearing Agency that evidences the Book Entry Bonds
of each Beneficial Owner in accordance with the written instructions received by
the Clearing Agency from the Clearing Agency Participant through which each
Beneficial Owner owns his Book Entry Bonds. The Trustee or Issuer shall
establish a record date for the purposes of such vote or consent and to the
extent possible shall provide the Clearing Agency not less than 15 days notice
of such record date prior to the date thereof.
(i) To the extent that the Letter of Representations provides that the
Issuer or the "Agent" shall provide certain information to or comply with
certain procedures required by the Clearing Agency under said Letter, the
Trustee (as "Agent") shall provide such information or perform such functions
unless the Issuer and Trustee shall agree otherwise.
The inclusion of the above procedures relating to the Book Entry Bonds in this
Series 1996C Supplement shall in no way be construed as imposing upon the
Trustee, the Bond Registrar or the Issuer any liability or responsibility for
compliance with such procedures by the Clearing Agency, any Clearing Agency
Participant or any brokerage firm.
Section 21. Transfer of Bonds. All transfers by Beneficial Owners of
Book Entry Bonds shall be made in accordance with the procedures established by
the Clearing Agency Participant or brokerage firm representing such Beneficial
Owner. Each Clearing Agency Participant shall only transfer Book Entry Bonds of
Beneficial Owners it represents or brokerage firms for which it acts as agent in
accordance with the Clearing Agency's normal procedures.
Section 22. Substitutions. In addition to the provisions of the Indenture,
with particular reference to Sections 2.13 and 7.12, substitutions, withdrawals
and deposits of GNMA Certificates are subject to the following conditions:
(a) All GNMA Certificates initially securing the Bonds must bear
interest at rates ranging from 6.5% to 9.0% per annum.
(b) All GNMA Certificates must have maturity dates no earlier than January
1, 2016 and no later than September 1, 2032. Any payments of principal and
interest due to be received on any
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GNMA Certificates after September 30, 2027 the Stated Maturity date of the
Bonds, will not be included in the calculation of GNMA Collateral Value.
(c) The GNMA Collateral Value of the total pool of GNMA Certificates
securing the Bonds may not, at any time, exceed 106% of the GNMA Collateral
Value then required to be maintained to secure the Bonds pursuant to the
provisions of the Indenture and this Series 1996C Supplement.
Section 23. Accounting by the Issuer and Reports by Independent
Accountants.
(a) The Issuer shall make the calculations required pursuant to Section
7.10(b) of the Indenture on or before a date each year which is within ten (10)
Business Days following September of each calendar year, commencing with
September, 1997, so long as any Bonds remain outstanding. (b) Pursuant to
Section 7.12(b) of the Indenture, the Issuer, or the Trustee on behalf of the
Issuer, shall direct the firm of Independent Accountants appointed pursuant to
Section 7.11(a) of the Indenture to deliver to the Trustee the reports required
by Section 7.11(b) of the Indenture annually, on a date which is within 45 days
after September of each calendar year, commencing with September, 1997 so long
as any Bonds remain outstanding. Each such report shall (i) recalculate and
verify the GNMA Collateral Value of the GNMA Certificates pledged to secure the
Bonds as determined by the Issuer pursuant to Section 7.10(b) for the last
Accounting Date in such annual period and (ii) recalculate the Issuer's most
recent determinations made pursuant to Section 7.10(b), and indicate that such
amounts are mathematically correct. In all other respects such reports of
Independent Accountants will be delivered in accordance with the provisions of
Section 7.11 of the Indenture.
Section 24. Expense Fund Amount. The "1996C Expense Fund Amount" initially
shall be $4,300.00 which amount shall be deposited with the Trustee as of
September 26, 1996. Section 25. Modification and Ratification of Indenture. The
Indenture
as modified and supplemented by this Series 1996C Supplement with respect to the
Bonds (but which modification and supplement shall not apply to any other Series
of Bonds unless otherwise specified in the related Series Supplement) is in all
respects ratified and confirmed, and the Indenture as so modified and
supplemented by this Series 1996C Supplement shall be read, taken and construed
as one and the same instrument.
Section 26. Counterparts. This Series 1996C Supplement may be executed in
any number of counterparts, each of which so executed shall be deemed to be an
original, but all of such counterparts shall together constitute but one and the
same instrument.
DAL02:47529.1
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<PAGE>
Section 27. GOVERNING LAW. THIS SERIES 1996C SUPPLEMENT AND EACH BOND
ISSUED HEREUNDER SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS
OF THE STATE OF TEXAS APPLICABLE TO AGREEMENTS MADE AND TO BE PERFORMED THEREIN.
DAL02:47529.1
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<PAGE>
IN WITNESS WHEREOF, the Issuer and the Trustee have caused this Series
1996C Supplement to be duly executed by their respective officers thereunto duly
authorized as of the day and year first above written.
RAY ELLISON MORTGAGE ACCEPTANCE CORP.
By: /s/Jack Biegler
Jack Biegler, President
STATE OF TEXAS S S ss. COUNTY OF DALLAS S
The foregoing instrument was acknowledged before me this 26th day of
September, 1996, by Jack Biegler, President of Ray Ellison Mortgage Acceptance
Corp., a Texas corporation, on behalf of said corporation.
Notary Public
DAL02:47529.1
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<PAGE>
THE BANK OF NEW YORK, as Trustee
By: The Bank of New York Trust Company of
Florida, N.A., Agent
By: /s/Tamara Ellis
Tamara Ellis, Assistant Vice President
STATE OF TEXAS ss.
ss. ss.
COUNTY OF DALLAS ss.
The foregoing instrument was acknowledged before me this 26th day of
September, 1996 by Tamara Ellis of The Bank of New York Trust Company of
Florida, N.A., as Agent for The Bank of New York, on behalf of said entity.
Notary Public
09/25/96 (2:05 pm)
2572/16534-68915
DAL02:47529.1
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<PAGE>
EXHIBIT A
[Begins on Next Page]
DAL02:47529.1
<PAGE>
PRINCIPAL OF THIS BOND IS PAYABLE AS SET FORTH HEREIN. ACCORDINGLY, THE
OUTSTANDING PRINCIPAL OF THIS BOND AT ANY TIME MAY BE LESS THAN THE
AMOUNT SHOWN ON THE FACE HEREOF.
THIS BOND IS A GLOBAL BOND REPRESENTING THE OWNERSHIP OF THE ENTIRE CLASS OF
SECURITIES REFERRED TO BELOW. REGISTRATION OF ANY TRANSFER OF OWNERSHIP OF THIS
BOND MAY BE MADE ONLY IN WHOLE AND ONLY TO AN ENTITY THAT IS A "CLEARING
CORPORATION" AS DEFINED IN SECTION 8.102(c) OF THE UNIFORM COMMERCIAL CODE AS IN
EFFECT IN THE STATE OF TEXAS.
RAY ELLISON MORTGAGE ACCEPTANCE CORP.
7.10% GNMA-COLLATERALIZED BOND, SERIES 1996C
DUE SEPTEMBER 30, 2027
ACCRUAL DATE: SEPTEMBER 26, 1996
$9,000,000 R-1 CUSIP NO. 754555 DT4
Ray Ellison Mortgage Acceptance Corp., a corporation duly organized and
existing under the laws of the State of Texas (herein referred to as the
"Issuer"), for value received, hereby promises to pay to CEDE & CO. or
registered assigns, the principal sum of NINE MILLION DOLLARS ($9,000,000) on or
before September 30, 2027 (the "Stated Maturity"), and to pay interest (computed
on the basis of a 360-day year of twelve 30-day months) on the unpaid principal
amount of this Bond outstanding from time to time from September 26, 1996 (the
"Accrual Date"), or such later date to which interest has been paid, until the
principal amount of this Bond is paid in full, at the rate of seven and
one-tenth percent (7.10%) per annum, such interest being payable monthly on the
last day of each calendar month in each year, or the immediately succeeding
Business Day, as set forth in (a), (b) and (c) below, commencing on November 30,
1996 (the "Payment Dates"), except that thirty-five (35) days' interest will be
payable with respect to any portion of this Bond redeemed on October 31, 1996.
Principal payments on this Bond will be made in the form of redemptions
commencing on October 31, 1996, or the immediately succeeding Business Day, and
on each monthly Payment Date thereafter (each such date being a "Redemption
Date"). Principal payments will be made as described on the reverse hereof.
Interest payable on this Bond on any Payment Date will be equal to the
amount of interest that has accrued during the related monthly period (each an
"Accrual Period") beginning on the first day of the month preceding the month in
which such Payment Date occurs (or on the Accrual Date in the case of the first
Payment Date) and ending on the last day of the month preceding the month
DAL02:46692.1
<PAGE>
in which such Payment Date occurs. The rate of interest on this Bond at the
rate and computed as described above, is referred to herein as the "Interest
Rate."
DAL02:46692.1
<PAGE>
The interest on this Bond (other than interest paid with respect to the
portion of this Bond that is redeemed on October 31, 1996 which shall be payable
as described previously), calculated as set forth in the preceding paragraph,
shall be due and payable in the following manner:
a. Interest at the Interest Rate from the Accrual Date for the thirty-five
(35) day period beginning on such date and ending October 31, 1996 shall be due
and payable on November 30, 1996;
b. Thirty (30) days' interest at the Interest Rate shall be due and payable
on the second Payment Date and each Payment Date thereafter, in each case for
the related Accrual Period; and
c. Thirty (30) days' interest at the Interest Rate shall be payable on the
Payment Date on which this Bond matures or (if earlier) is redeemed, on the
entire or any portion of principal of this Bond that then matures or is then
redeemed, from the end of the Accrual Period related to such Payment Date to
such Payment Date, in addition to interest then payable as described in clauses
(a) and (b) above, as the case may be.
The interest payable on any Payment Date, other than interest payable
on this Bond (or any portion hereof) on the Payment Date on which this Bond (or
such portion) matures or is redeemed, will, as provided in the Indenture
referred to on the reverse hereof, be paid to the person in whose name this Bond
is registered on the Regular Record Date for such Payment Date, which shall be
the close of business on the last business day of the month immediately
preceding the calendar month in which such Payment Date occurs (such persons
being referred to herein as "Bondholders" or "Holders"). Any such interest not
so punctually paid or duly provided for ("Defaulted Interest") shall forthwith
cease to be payable to the Holder as of the Regular Record Date, and shall be
paid to the Holder of this Bond (i) as of the Special Record Date for the
payment of such Defaulted Interest to be fixed by the Trustee, notice whereof
shall be given to Bondholders not less than 10 days prior to such Special Record
Date, or (ii) at any time in any other lawful manner not inconsistent with the
requirements of any securities exchange on which this Bond may be listed, and
upon such notice as may be required by such exchange, all as more fully provided
in said Indenture.
The principal of and interest on this Bond are payable in such coin or
currency of the United States of America as at the time of payment is legal
tender for payment of public and private debts. All payments made by the Issuer
with respect to this Bond shall be applied first to interest due and payable on
the Bond as provided above and then to the unpaid principal of this Bond. Any
installment of principal or interest which is not paid when and as due shall
bear interest at the rate of interest borne by the principal of this Bond from
the date due to the date of payment thereof, but only to the extent that payment
of such interest shall be lawful and enforceable.
No reference herein to the Indenture and no provision of this Bond or
of the Indenture shall alter or impair the obligation of the Issuer, which is
absolute and unconditional to the extent permitted by applicable law, to pay the
principal of and interest on this Bond at the times, place and rate, and in the
coin or currency, herein prescribed.
DAL02:46692.1
<PAGE>
Reference is made to the further provisions of this Bond set forth on
the reverse hereof, which shall have the same effect as though fully set forth
at this place.
Unless the certificate of authentication hereon has been executed by
the Trustee by manual signature, this Bond shall not be entitled to any benefit
under the Indenture, or be valid or obligatory for any purpose.
DAL02:46692.1
<PAGE>
IN WITNESS WHEREOF, Ray Ellison Mortgage Acceptance Corp. has caused
this instrument to be signed, manually or in facsimile, by its President or a
Vice President and by its Secretary or an Assistant Secretary and a facsimile of
its corporate seal to be imprinted hereon.
RAY ELLISON MORTGAGE ACCEPTANCE CORP.
By: /s/Jack Biegler
President
ATTEST:
By:/s/ Locksley Simmons
Assistant Secretary
This is one of the Bonds referred to in the within mentioned Indenture.
THE BANK OF NEW YORK, as Trustee
By: The Bank of New York Trust Company of
Florida, N.A., Agent
By: /s/ Tamara Ellis
Tamara Ellis, Assistant Vice President
Dated:________________________
DAL02:46692.1
<PAGE>
Series 1996C/Reverse Page 1
RAY ELLISON MORTGAGE ACCEPTANCE CORP.
GNMA-COLLATERALIZED BOND
This Bond is one of a duly authorized issue of Bonds of the Issuer,
designated as its GNMA-Collateralized Bonds (herein called the "Bonds"), issued
and to be issued in one or more series, and is one of the series of Bonds
designated on the face hereof (herein called the "Series"), which Series has
been authorized and issued under a Series 1996C Supplement dated as of September
26, 1996 to the Indenture dated as of August 1, 1992, as amended through
September 26, 1996 (the Indenture, as amended, together with the Series 1996C
Supplement constitute one and the same instrument and are herein, collectively
and as amended or supplemented from time to time as set forth in the Indenture,
referred to as the "Indenture") each as between the Issuer and The Bank of New
York, as trustee (the "Trustee"), which term includes any successor Trustee
under the Indenture, and reference is hereby made for a statement of the
respective rights thereunder of the Issuer, the Trustee and the Holders of the
Bonds, and the terms upon which the Bonds are, and are to be, authenticated and
delivered. All terms used in this Bond which are defined in the Indenture shall
have the meanings assigned to them in the Indenture (except that the term
"Bonds" shall refer to the Bonds of this Series unless otherwise indicated
herein).
As provided in the Indenture, the Bonds of this Series are equally and
ratably secured by the collateral pledged as security therefor to the extent
provided by the Indenture, and the Holders of such Series of Bonds have no
rights with respect to any of the collateral pledged as security for any other
series.
Except in the event of Book Entry Termination, beneficial ownership
interests in this Series of Bonds (which are issuable in registered form only to
the Clearing Agency in a denomination representing the entire aggregate
principal amount of the Bonds of this Series) may be held by Beneficial Owners
(as defined below) only in registered book entry form (a "Book Entry Bond")
through the Holder hereof and its participating member firms. This Bond
evidences, in the aggregate, all of the Outstanding Book Entry Bonds, and the
Holder hereof, by its acceptance of this Bond, certifies that it is eligible to
serve as Clearing Agency under the Indenture and agrees to be bound by, and to
comply with, all of the provisions of this Bond and the Indenture relating to
the Book Entry Bonds (the "Book Entry Procedures").
Principal payments on the Book Entry Bonds will be applied first to
redemption of the Book Entry Bonds at the request of Beneficial Owners and then
to mandatory redemption of the Book Entry Bonds as described below.
Notwithstanding the foregoing, any amounts required to be paid as principal of
the Book Entry Bonds that are in excess of an integral multiple of $1,000 shall
be retained in the Redemption Fund until the following Redemption Date. The
entire unpaid principal amount of the Book Entry Bonds shall be due and payable,
if not then previously paid, on the Stated Maturity.
The Book Entry Procedures, which each Holder of this Bond by its
acceptance hereof agrees to and shall be bound by, are as follows:
DAL02:46692.1
<PAGE>
Series 1996C/Reverse Page 2
a. Beneficial ownership of an interest in a Book Entry Bond by
any Person (a "Beneficial Owner") may be held through entries on the records of
brokerage firms maintaining an account of the Beneficial Owner for such purpose.
In turn, each brokerage firm's interest in this Bond will be recorded on the
records of the Clearing Agency or of another bank or brokerage firm that
participates in the book entry system maintained by the Clearing Agency (a
"Clearing Agency Participant") and acts as agent for such brokerage firm if the
Beneficial Owner's brokerage firm is not a Clearing Agency Participant. In
accordance with its normal procedures, the Clearing Agency shall record the
positions held by each Clearing Agency Participant in the Book Entry Bonds,
whether held for its own account or as a nominee for another person.
b. Each payment of principal of and interest on this Bond will
be paid by the Trustee to the Clearing Agency. The Clearing Agency shall credit
the amount of such payments to the accounts of the applicable Clearing Agency
Participants in accordance with its normal procedures. Each Clearing Agency
Participant shall be responsible for disbursing such payments to the Beneficial
Owners of the Book Entry Bonds that it represents, and to each brokerage firm
for which it acts as agent. Each such brokerage firm shall be responsible for
disbursing funds to the Beneficial Owners of the Book Entry Bonds that it
represents. Except with respect to the payment of principal of and interest on
this Bond to the Clearing Agency or except as otherwise provided by law, neither
the Trustee, the Issuer nor the Bond Registrar shall have any responsibility for
such payments described in this subparagraph (b).
c. With respect to the right of redemption at the request of
the Bondholders, a Beneficial Owner of Book Entry Bonds may request that one or
more of such Beneficial Owner's Book Entry Bonds be redeemed at the earliest
opportunity subject to the limitations on the amount of such redemption
described below. A request for redemption may be submitted to the brokerage firm
that maintains such Beneficial Owner's account in the Book Entry Bonds. That
firm will in turn be responsible for making the request to the Clearing Agency.
The Clearing Agency will time-stamp each request for redemption as received,
subject to such reasonable procedures as it may establish with respect to
determining the order of receipt of requests received on the same day. The
Clearing Agency will promptly forward such time-stamped requests for redemption
to the Trustee. A Beneficial Owner shall be permitted to withdraw his request
for redemption by notifying the brokerage firm that maintains his account in the
Book Entry Bonds. The Clearing Agency and the Clearing Agency Participants may
require that in order for a request for redemption, or withdrawal of any request
for redemption, to be honored with respect to a Redemption Date, it must be
received by the Clearing Agency (in the case of a request for redemption) and by
the Trustee (in the case of a withdrawal of a request for redemption) on a
Tender Date but not later than the last Tender Date of the month in which such
Redemption Date occurs.
DAL02:46692.1
<PAGE>
Series 1996C/Reverse Page 3
d. With respect to a mandatory redemption, if the Trustee
notifies the Clearing Agency, prior to the 10th Business Day preceding the
Redemption Date to the extent possible but in no event later than the 18th
calendar day of the month in which such Redemption Date occurs, that on such
Redemption Date the amount available in the Redemption Fund with respect to such
Redemption Date is in excess of the aggregate principal amount of the Book Entry
Bonds for which timely requests for redemption have been delivered to the
Trustee, the Clearing Agency shall select Book Entry Bonds to be redeemed in
accordance with its then applicable established random lot procedures and the
other established procedures of the Clearing Agency Participants and indirect
brokerage firms representing the Beneficial Owners of the Book Entry Bonds. Such
procedures may provide for the redemption in part of any Book Entry Bond having
a denomination in excess of $1,000. The Clearing Agency shall give notice to
those Clearing Agency Participants whose Book Entry Bonds have been so selected
for redemption.
e. A Beneficial Owner of a Book Entry Bond shall be entitled
to transfer Beneficial Ownership of such Book Entry Bond only upon compliance
with the procedures established by the Clearing Agency Participant representing
such Beneficial Owner or the brokerage firm representing such Beneficial Owner,
if any. Each Clearing Agency Participant shall only transfer Book Entry Bonds of
Beneficial Owners it represents, or brokerage firms for which it acts as agent,
in accordance with the Clearing Agency's normal procedures. Except in the event
of Book Entry Termination, no Beneficial Owner shall be entitled to receive a
certificated Bond evidencing ownership of his Book Entry Bond.
f. Whenever the vote or consent of the Holders of the Bonds is
solicited or may be given pursuant to the Indenture, the Clearing Agency shall
vote the percentage of the aggregate principal amount of this Bond then
Outstanding that evidences the Book Entry Bonds of each Beneficial Owner in
accordance with the written instructions received by the Clearing Agency from
the Clearing Agency Participant through which each Beneficial Owner owns his
Book Entry Bonds. The Trustee or Issuer shall establish a record date for the
purposes of such vote or consent and to the extent possible shall provide the
Clearing Agency not less than 15 days notice of such record date prior to the
date thereof.
The above-referenced Book Entry Procedures have been included in this Bond
solely for the purpose of setting forth the rights of the Beneficial Owners of
the Book Entry Bonds with respect to the holding of each Bond by the Clearing
Agency and the Clearing Agency Participants, and the inclusion of such Book
Entry Procedures in this Bond shall in no way be construed as imposing upon the
Trustee, the Bond Registrar or the Issuer any liability or responsibility for
compliance with such Book Entry Procedures by the Clearing Agency, any Clearing
Agency Participant or any brokerage firm.
If the aggregate principal amount of the Book Entry Bonds for which
timely requests for redemption have been submitted exceeds the amount available
in the Redemption Fund with respect to any Redemption Date, principal payments
allocated to the Book Entry Bonds will be allocated on such Redemption Date by
the Trustee as follows: first, to Clearing Agency Participants on behalf of
Deceased Holders in the order that such Deceased Holders' time-stamped requests
for such
DAL02:46692.1
<PAGE>
Series 1996C/Reverse Page 4
redemption have been received by the Clearing Agency until each Deceased Holder
requesting redemption through a Clearing Agency Participant has received an
initial priority principal distribution of up to $100,000 with respect to the
Book Entry Bonds held by such Deceased Holder; second, to Clearing Agency
Participants on behalf of other Beneficial Owners in the order that such
Beneficial Owners' requests for redemption have been received until each
Beneficial Owner requesting redemption through a Clearing Agency Participant has
received an initial priority principal distribution of up to $10,000 with
respect to such Beneficial Owner's Book Entry Bonds; third, to Clearing Agency
Participants on behalf of Deceased Holders in excess of such $100,000 limitation
in the order that such time-stamped requests for redemption have been received
by the Clearing Agency and without limitation as to the principal amount which
may be so redeemed; and fourth, to Clearing Agency Participants on behalf of
other Beneficial Owners in excess of such $10,000 limitation in the order that
such time-stamped requests for redemption have been received by the Clearing
Agency and without limitation as to the principal amount which may be so
redeemed. The death of a tenant by the entirety, joint tenant or tenant in
common will be deemed to be the death of the Holder of the Book Entry Bond and
the entire principal amount of the Book Entry Bond so held will be subject to
priority in redemption, and the death of a person who, during his lifetime, was
entitled to substantially all of the beneficial interests of ownership of a Book
Entry Bond will be deemed to be the death of the Holder of such Book Entry Bond,
regardless of the registered Holder of such Book Entry Bond, if such beneficial
interest can be established to the satisfaction of the Trustee. Such beneficial
interest will be deemed to exist in typical cases of street name or nominee
ownership, ownership by a trustee, ownership under the Uniform Gifts to Minors
Act and community property or other joint ownership arrangements between a
husband and wife, and in trust arrangements and certain other arrangements where
a person has substantially all of the beneficial ownership interest in the Book
Entry Bond during his or her lifetime. Beneficial interests shall include the
power to sell, transfer or otherwise dispose of a Book Entry Bond and the right
to receive the proceeds therefrom, as well as interest and principal payable
with respect thereto.
Payments of interest on this Bond due and payable on each Payment Date,
together with any installment of principal of this Bond due and payable on each
Payment Date which is also a Redemption Date for this Bond to the extent not in
full payment of this Bond, shall be made by check mailed to the Person whose
name appears as the registered Holder of this Bond (or one or more Predecessor
Bonds) on the Bond Register as of the Regular Record Date. Checks for amounts
which include installments of principal due on this Bond shall be mailed to the
Person entitled thereto at the address of such Person as it appears on the Bond
Register as of the applicable Record Date without requiring that this Bond be
submitted for notation of payment and checks returned undelivered will be held
for payment to the Person entitled thereto, subject to the terms of the
Indenture, at the office or agency in the United States of America designated by
the Issuer for such purpose pursuant to the Indenture. Any reduction in the
principal amount of this Bond (or any one or more Predecessor Bonds) effected by
any payments made on any Redemption Date shall be binding upon all Holders of
this Bond and of any Bond issued upon the registration of transfer hereof or in
exchange herefor or in lieu hereof, whether or not noted hereon. Notwithstanding
the foregoing, so long as this Bond is registered in the name of the Clearing
Agency or its nominee, as the representative of the Beneficial Owners, if so
requested by the Clearing Agency, the principal of and interest on this Bond
shall be payable by wire transfer of federal funds to the Clearing Agency or its
nominee, except for the final payment due on Stated Maturity of this Bond, which
as described
DAL02:46692.1
<PAGE>
Series 1996C/Reverse Page 5
below shall be made only upon presentation and surrender of this Bond at the
office or agency of the Trustee maintained for that purpose. Payment of the then
remaining unpaid principal amount of this Bond on the Stated Maturity of its
final installment of principal or on such earlier date as the Issuer shall be
required to apply payments received with respect to the GNMA Certificates
securing the Bonds of this Series to payment of the then remaining unpaid
principal amount of this Bond, or to payment of the amount payable on any date
as of which this Bond has been called for redemption in full, shall be made upon
presentation of this Bond to the office or agency of the Trustee maintained for
such purpose.
If an Event of Default as defined in the Indenture shall occur and be
continuing with respect to the Bonds, the Bonds may become or be declared due
and payable in the manner and with the effect provided in the Indenture. If any
such acceleration of maturity occurs prior to the Stated Maturity of the final
installment of principal of this Bond, the amount payable to the Holder of this
Bond will be equal to the aggregate unpaid principal amount of this Bond on the
date this Bond becomes so due and payable, together with accrued interest on
such unpaid principal amount from the last day to which interest has been paid
to the date of payment thereof. In all other circumstances, following the
acceleration of the maturity of the Bonds, all amounts collected as proceeds of
the collateral securing the Bonds or otherwise shall be applied, pro rata among
all Bonds of this Series, without preference or priority, first to the payment
of interest and then to the payment of amounts due with respect to principal.
An Event of Default with respect to the Bonds of any other series
issued under the Indenture, including any failure to make any payment of
principal or interest with respect thereto when and as due, will not be an Event
of Default with respect to the Bonds of this Series.
The Bonds of the Series may be redeemed at the option of the Issuer, in
whole or in part, at any time or from time to time on any Redemption Date (i)
prior to the fourth anniversary of their issuance, if the outstanding aggregate
principal amount of the Bonds of the Series declines to 20% or less of their
original aggregate principal amount, and (ii) at any time on or after the fourth
anniversary of their issuance. The amount paid upon such optional redemption
shall equal 100% of the unpaid principal amount of the Bonds to be redeemed,
plus accrued interest to the date of such optional redemption.
If provision is made for the redemption and payment of this Bond in
accordance with the Indenture, the portion of the principal amount of this Bond
so redeemed shall thereupon cease to bear interest from and after the date set
for such redemption.
As provided in the Indenture and subject to certain limitations therein
set forth (including without limitation the requirement that the transferee be
eligible to serve as Clearing Agency), the transfer of this Bond may be
registered on the Bond Register of the Issuer, upon surrender of this Bond for
registration of transfer at the office or agency designated by the Issuer
pursuant to the Indenture, duly endorsed by, or accompanied by a written
instrument of transfer in form satisfactory to the Trustee duly executed by, the
Holder hereof or his attorney duly authorized in writing, and thereupon a single
new Bond representing the entire aggregate principal amount of the Bonds then
Outstanding, will be issued to the designated transferee or transferees.
DAL02:46692.1
<PAGE>
Series 1996C/Reverse Page 6
The Indenture permits, with certain exceptions as therein provided, the
amendment thereof and the modification of the rights and obligations of the
Issuer and the rights of the Holders of the Bonds under the Indenture at any
time by the Issuer with the consent of the Holders of a majority in aggregate
principal amount of Bonds at the time Outstanding (as defined in the Indenture)
in case Outstanding Bonds of all series are to be affected, or with the consent
of the Holders of a majority in aggregate principal amount of the Bonds at the
time Outstanding of each series to be affected in case one or more, but less
than all, of the series of Bonds then Outstanding are to be affected. The
Indenture also contains provisions permitting the Holders of specified
percentages in aggregate principal amount of the Bonds at the time Outstanding,
and of Bonds at the time Outstanding of each series to be affected in case one
or more, but less than all, such series are to be affected, on behalf of the
Holders of all the Bonds, to waive compliance by the Issuer with certain
provisions of the Indenture and certain past defaults under the Indenture and
their consequences. Any such consent or waiver by the Holder of this Bond shall
be conclusive and binding upon such Holder and upon all future Holders of this
Bond and of any Bond issued upon the registration of transfer hereof or in
exchange herefor or in lieu hereof whether or not notation of such consent or
waiver is made upon this Bond.
The term "Issuer" as used in this Bond includes any successor under the
Indenture.
AS PROVIDED IN THE INDENTURE, THIS BOND AND THE INDENTURE SHALL BE
CONSTRUED IN ACCORDANCE WITH, AND GOVERNED BY, THE LAWS OF THE STATE OF TEXAS
APPLICABLE TO AGREEMENTS MADE AND TO BE PERFORMED THEREIN.
No reference herein to the Indenture and no provision of this Bond or
of the Indenture shall alter or impair the obligation of the Issuer, which is
absolute and unconditional, to pay the principal of and interest on this Bond at
the time, place and rate, and in the coin or currency, herein prescribed.
DAL02:46692.1
<PAGE>
Series 1996C/Reverse Page 7
FORM OF ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto
Please print or typewrite address of assignee:
the within Bond of Ray Ellison Mortgage Acceptance Corp. and does hereby
irrevocably constitute and appoint _______________________
__________________________ attorney to transfer the said Bond on the books of
the within named corporation, with full power of substitution in the premises.
Date:______________________
Notice: The signature to this presentment must correspond with the name as
written upon the face of this Bond in every particular without alteration or
enlargement or any change whatever, except with respect to redemptions of Bonds
of Deceased Holders. The signature must be guaranteed by an officer of a
commercial bank, trust company or by a member firm of the New York Stock
Exchange or another national securities exchange. Notarized or witnessed
signatures are not acceptable.
09/18/96 (11:18am)
2572/16534-68915
DAL02:46692.1
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EXHIBIT B
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DAL02:47529.1
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[EXHIBIT B]
[Form of Issuer's Letter of Credit]
[Letterhead of ]
___________ __, 199__
The Bank of New York, as Trustee under the
Indenture and the Series 1996C Supplement Referred to Below
10161 Centurion Parkway, 3rd Floor
Jacksonville, Florida 32256
Attention: Corporate Trust Division
Re: Our Irrevocable Transferable Letter of Credit No. _____ for Reserve
Fund Ray Ellison Mortgage Acceptance Corp., Series 1996C GNMA-Collateralized
Bonds Gentlemen:
By order of our client, Ray Ellison Mortgage Acceptance Corp.
("REMAC"), we hereby open our Irrevocable Transferable Letter of Credit No.
________, in favor of _________________, as the trustee under the indenture
referred to in the second paragraph hereof, for an amount not to exceed in the
aggregate U.S. $________ (__________________*__________________), effective
immediately and expiring at our _________________________ office,
______________________, on __________________, __________ unless earlier
terminated as hereinafter provided.
This Letter of Credit is relative to, but does not incorporate by such
reference, that certain Indenture dated as of August 1, 1992, as amended through
September 26, 1996 and as supplemented by the Series 1996C Supplement dated as
of September 26, 1996, between Ray Ellison Mortgage Acceptance Corp. and you
(the "Indenture"). We shall have no obligation or responsibility with respect to
the performance of any term or provision of the Indenture or the fulfillment of
any condition stated therein.
Funds under this Letter of Credit are available from time to time to
you as such trustee or to your successor as such trustee under the Indenture to
whom this Letter of Credit shall be transferred by you as hereafter provided
("Trustee") against Trustee's sight draft(s) drawn on us, mentioning thereon our
Credit No. ________. Each such draft must be accompanied by a written statement
purportedly signed by an authorized officer of the Trustee stating as follows:
"(i) that the officer executing the certificates is a duly authorized officer of
the drawer of the draft, (ii) that the drawer of the draft is the Trustee under
the Indenture, and (iii) that the amount of the accompanying draft
DAL02:47535.1
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<PAGE>
represents an amount for which Trustee is entitled, pursuant to the terms of
Section 7.07 of the Indenture, to draw under the letter of credit referred to in
such section of the Indenture."
DAL02:47535.1
- 2 -
<PAGE>
The amount of this Letter of Credit may be reduced in the event that
(i) REMAC elects to deposit any amount of cash with the Trustee to fund all or a
part of the Reserve Fund required to be maintained pursuant to the Series 1996C
Supplement, dated September 26, 1996, between REMAC and the Trustee (the "Series
Supplement") or (ii) the amount required to be maintained in the Reserve Fund is
reduced for any reason, including without limitation (A) a reduction in the
aggregate outstanding principal amount of the Series 1996C Bonds or (B) a
reduction in the Requisite Amount of Reserve Fund, as defined in the Series
1996C Supplement. In either of the foregoing events this Letter of Credit may be
reduced by an amount equal to the amount of cash so deposited or the amount by
which the amount required to be maintained in the Reserve Fund is reduced, as
the case may be. Any such reduction shall be made upon our receipt of a letter
requesting reduction of this Letter of Credit by a stated amount, executed by
both the Trustee and REMAC.
We may at any time terminate this Letter of Credit upon at least sixty
(60) days prior written notice to Trustee delivered via courier specifying that
this Letter of Credit shall expire on a specified date not less than sixty (60)
days from the date such notice is delivered via courier to Trustee, whereupon
this Letter of Credit shall expire on such date with the same effect as if such
expiration date had originally been set forth herein, provided, however, that
upon Trustee's receipt of such notification, Trustee may draw one sight draft
for any amount not greater than the unutilized balance of this Letter of Credit,
mentioning thereon our Credit No. _________, and accompanied by a written
statement purportedly signed by an authorized officer of Trustee stating as
follows: "(i) that the officer executing the certificate is a duly authorized
officer of the drawer of the draft, and (ii) that the drawer of the draft is the
Trustee under the Indenture."
The Trustee may, at any time, draw one sight draft for any amount not
greater than the unutilized balance of this Letter of Credit, mentioning thereon
our Credit No. _________, and accompanied by a written statement as follows:
"(i) that the officer executing the certificate is a duly authorized officer of
the drawer of the draft, (ii) that the drawer of the draft is the Trustee under
the Indenture, (iii) that the Trustee has been notified by REMAC that continued
reliance on such letter of credit for the purpose or purposes for which it was
originally delivered to the Trustee would result in a downgrading of a rating of
the Series 1996C Bonds, and (iv) that REMAC has not replaced such letter of
credit with a Qualified Letter of Credit within seven (7) days after the giving
of the notice referred to in (iii)."
This Letter of Credit may be transferred in its entirety for the then
relevant amount to the Trustee's successor as trustee under the Indenture, and
said transfer will become effective upon our receipt of (a) the original of this
Letter of Credit, and (b) our transfer form properly filled out and signed by
you.
If we have received here at our _______________________________________
office, _______________ ________________, Attention: ___________________
Trustee's sight draft(s) and statement(s) in conformity with the terms and
conditions thereof, we will honor the same by payment in immediately available
funds upon the due presentation and delivery of such documents. Where any date
mentioned herein shall fall on a Saturday, Sunday or bank holiday, such date
shall be extended to ______ p.m. ____________ time on the next following day on
which such office is open for business.
DAL02:47535.1
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<PAGE>
This Letter of Credit shall be subject to the Uniform Customs and
Practice for Documentary Credits (______ Revision), International Chamber of
Commerce Publication No. _____, and any amendments thereof, and to the extent
the same are not applicable this Letter of Credit shall be governed by Article 5
of the Uniform Commercial Code of the State of Texas.
Very truly yours,
Authorized Signature
09/18/96 (4:09 pm)
2572/16534-68915
DAL02:47535.1
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EXHIBIT C
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DAL02:47529.1
<PAGE>
Letter of Representations
Ray Ellison Mortgage Acceptance Corp.
Name of Issuer
The Bank of New York, as Trustee
Name of Trustee
September 26, 1996
(Date)
Attention: General Counsel's Office
The Depository Trust Company
55 Water Street: 49th Floor
New York, NY 10041-0099
Re: Ray Ellison Mortgage Acceptance Corp.
GNMA-Collateralized Bonds
Series 1996C
Ladies and Gentlemen:
This letter sets forth our understanding with respect to certain matters
relating to the above-referenced issue (the "Securities"). Trustee will act as
trustee with respect to the Securities pursuant to an Indenture dated as of
August 1, 1992, as amended through September 26, 1996, and as supplemented by a
Series 1996C Supplement, dated September 26, 1996, relating to the Securities
(the Indenture and Series 1996C Supplement are referred to collectively as the
"Document"). Pursuant to an Underwriting Agreement dated August 13, 1992, as
amended through September 26, 1996 (the "Underwriting Agreement") by and among
the Issuer, Ray Ellison Mortgage Investment Corp., and Rauscher Pierce Refsnes,
Inc., as representative of the several underwriters and a Terms Agreement dated
September 16, 1996 (the "Terms Agreement") by and among the Issuer, Rauscher
Pierce Refsnes, Inc. and the other underwriters, if any, named therein
(collectively, the "Underwriters"), the Underwriters have agreed to purchase,
and the Issuer has agreed to issue, the Securities. The Underwriters are
distributing the Securities through the Depository Trust Company ("DTC").
To induce DTC to accept the Securities as eligible for deposit at DTC, and
to act in accordance with its Rules with respect to the Securities, Issuer and
Trustee make the following representations to DTC:
1. Prior to closing on the Securities on September 26, 1996, there shall be
deposited with DTC one Security certificate registered in the name of DTC's
nominee, Cede & Co., for each stated maturity of the Securities in the face
amounts set forth on Schedule A hereto, the total of which represents 100% of
the principal amount of such Securities. If, however, the aggregate principal
amount of any maturity exceeds $200 million, one certificate will be issued with
respect to each $200 million of principal amount and an additional certificate
will be issued with respect to any remaining principal amount. Each Security
certificate shall bear the following legend:
Unless this certificate is presented by an authorized representative of
The Depository Trust Company, a New York corporation ("DTC"), to Issuer or its
agent for registration of transfer, exchange or payment and any certificate
issued is registered in the name of Cede & Co. or in such other name as is
requested by an authorized representative of DTC (and any payment is made to
Cede & Co. or to such other entity as is requested by an authorized
representative of DTC), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner
hereof, Cede & Co., has an interest herein.
2. In the event of any solicitation of consents from or voting by holders of
the Securities, Issuer or Trustee shall establish a record date for such
purposes (with no provision for revocation of consents or votes by subsequent
holders) and shall, to the extent possible, send notice of such record date to
DTC not less than 15 calendar days in advance of such record date. Notices to
DTC pursuant to this Paragraph by telecopy shall be sent to DTC's Reorganization
Department at (212) 709-6896 or (212) 709-6897, and receipt of such notices
shall be confirmed by telephoning (212) 709-6870. Notices to DTC pursuant to
this Paragraph by mail or by any other means shall be sent to DTC's
Reorganization Department as indicated in Paragraph 3.
3. The Issuer will not disseminate invitations to beneficial owners of
Securities to tender their Securities. However, beneficial owners may request
redemption of their Securities as described in paragraphs 11 and 12 hereof and
the Issuer may redeem Securities at the option of the Issuer as described in the
Document.
4. All notices and payment advices sent to DTC shall contain the CUSIP
number of the Securities.
5. Trustee shall send DTC written notice with respect to the dollar amount
per $1,000 original face value (or other minimum authorized denomination if less
than $1,000 face value) payable on each payment date allocated as to the
interest and principal portions thereof preferably five, but not less than two,
business days prior to such payment date. Such notices, which shall also contain
the current pool factor, any special adjustments to principal/interest rates
(e.g., adjustments due to deferred interest or shortfall) and Trustee contact's
name and telephone number, shall be sent by telecopy to DTC's Dividend
Department at (212) 709-1723 or if by mail or by any other means to:
Manager: Announcements
Dividend Department
The Depository Trust Company
7 Hanover Square: 22nd Floor
New York, NY 10024-2695
6. Interest on the Securities will be payable monthly on the last day of
each month, or the immediately succeeding business day (each, a "Payment Date"),
with respect to interest accrued on the Securities during the previous calendar
month. Such monthly interest payments to be made on each respective Payment Date
will be made to holders of record of the Securities as of the close of business
on the last business day of the month preceding the month in which such Payment
Date occurs (each, a "Record Date"). Interest payable on the initial Payment
Date, November 30, 1996, will be with respect to 35 day's interest accrued from
September 26, 1996 through October 31, 1996.
7. Trustee must provide DTC, no later than noon (Eastern Time) on the
payment date, CUSIP numbers for each issue for which payment is being sent, as
well as the dollar amount of the payment for each issue. Notification of payment
details should be sent using automated communications.
8. Interest payments shall be received by Cede & Co., as nominee of DTC or
its registered assigns in same-day funds, no later than 2:30 p.m. (Eastern Time)
on each payment date ( in accordance with existing arrangements between Issuer
or Trustee and DTC). Absent any other arrangements between Issuer or Trustee and
DTC, such funds shall be wired as follows:
Chemical Bank
ABA 021000128
For credit to A/C The Depository Trust Company
Dividend Deposit Account 066-026776
Issuer or Trustee shall provide interest payment information to a standard
announcement service subscribed to by DTC. In the unlikely event that no such
service exists, Issuer or Trustee shall provide interest payment information
directly to DTC in advance of the interest payment date as soon as the
information is available. This information should be conveyed directly to DTC
electronically. If electronic transmission is not available, absent any other
arrangements between Trustee and DTC, such information should be sent by
telecopy to DTC's Dividend Department at (212) 709-1723 or (212) 709-1686, and
receipt of such notices shall be confirmed by telephoning (212) 709-1270.
Notices to DTC pursuant to the above or mail or by any other means shall be sent
to:
Manager, Announcements
Dividend Department
The Depository Trust Company
7 Hanover Square: 24th Floor
New York, NY 10004-2695
9. DTC shall receive maturity and redemption payments allocated with respect
to each CUSIP number on the payable date in same-day funds by 2:30 p.m. (Eastern
Time). Absent any other arrangements between Trustee and DTC, such payments
shall be wired as follows:
Chemical Bank
ABA 021000128
For credit to A/C The Depository Trust Company
Redemption Account 066-027306
in accordance with existing SDFS payment procedures in the manner set forth in
DTC's SDFS Paying Agent Operating Procedures, a copy of which has previously
been furnished to Trustee.
10. DTC shall receive all reorganization payments and CUSIP-level detail
resulting from corporate actions (such as tender offers, remarketings, or
mergers) on the first payable date in same-day funds by 2:30 p.m. (Eastern
Time). Absent any other arrangements between Trustee and DTC, such payments
shall be wired as follows:
Chemical Bank
ABA 021000128
For credit to A/C the Depository Trust Company
Reorganization Account 066-027608
11. To allow beneficial owners to tender for payment Securities pursuant to
the Document. DTC will accept tender requests by means of Voluntary Offering
Instructions via DTC's Participant Terminal System ("PTS") from Participants.
DTC will accept such Instructions from the 1st through the 10th day of each
month. DTC will electronically time-stamp all Instructions that it receives
during such period. Participants that have submitted Instructions may withdraw
such Instructions by sending electronic notice directly to Trustee by means of
Voluntary Offering Withdrawl Instructions via PTS. All such Withdrawl
Instructions must be received by Trustee on or prior to the last business day of
the window period listed above of the month preceding the month in which the
payment occurs.
12. In the event of a payment, Trustee shall select Securities to be repaid
from Instructions previously transmitted to it by DTC in the order that such
Instructions were received by DTC (as evidenced by DTC's electronic time-stamp
on such Instructions) or as selected by lot. Trustee, using DTC's automated put
(APUT) program, shall notify DTC and those Participants whose Instructions have
been accepted for payment of the aggregate principal amount of Securities to be
repaid on behalf of each such Participant, and the name and account number of
each beneficial owner whose Securities have been accepted for redemption. Such
information must be received by DTC 7 business days prior to the redemption date
(2 business days prior if electronic). In the event that the aggregate principal
amount of Securities required under the Document to be redeemed exceeds the
aggregate principal amount of Securities for which Instruction have been
submitted (as evidenced by the Instructions held by the Trustee), Trustee shall
notify DTC of the amount of such excess to the extent possible prior to the 10th
business day preceding the redemption date but in no event later than the 18th
calendar day of the month in which such redemption occurs. DTC will allocate
such excess in accordance with its "Called Securities Procedures")( as described
in DTC's Procedures) among the holdings of its Participants as of the close of
business on the day prior to the date of such notification based upon the
assumption that each Participant holds individual $1,000 Security units
aggregating the full principal amount of that Participant's holdings. If such
method of selection of Securities to be redeemed is necessary, DTC will notify
those of its Participants whose holdings have been so selected for redemption on
the forthcoming redemption date by the 23rd calandar day of the month in which
such redemption occurs. DTC will process such redemption in accordance with its
current Rules and procedures, subject to change from time to time.
13. Notices to DTC pursuant to Paragraphs 11 shall be sent to DTC's
Reorganization Department at (212) 709-6896 or (212) 709-6897, and receipt of
such notices shall be confirmed by telephoning (212) 709-6870. Notices to DTC
pursuant to Paragraph 12 shall be sent to DTC's Reorganization Department at
(212) 709-6895 and receipt of such notices shall be confirmed by telephoning
(212) 709-1470. Notices to DTC pursuant to Paragraphs 11 and 12 by mail or by
any other means shall be sent to Supervisor; Puts Security Unit: Reorganization
Department, at the address set forth in Paragraph 3.
14. DTC may direct Issuer, Trustee, or Tender Agent to use any other number
or address as the number or address to which notices or payments of interest or
principal may be sent.
15. In the event of a mandatory redemption or a redemption at the option of
beneficial owner necessitating a reduction in the aggregate principal amount of
Securities outstanding, DTC, in its discretion: (a) may request Trustee to issue
and authenticate a new Security certificate: or (b) shall make an appropriate
notation on the Security certificate indicating the date and amount of such
reduction in principal after notifying the Trustee thereof and obtaining the
concurrence of the Trustee to such amount (which amount shall be binding upon
the Trustee, the Issuer, DTC and all Participants and beneficial owners) except
in the case of final or full redemption in which case the certificate will be
presented to Issuer or Trustee prior to payment, if required.
16. The Document provides that Issuer may at its option redeem all of the
Securities under certain circumstances set forth in the Document. In the event
of an optional redemption by Issuer, Trustee shall notify DTC at least 15 days
prior to the Issuer redemption date. Upon receipt, DTC will forward such notice
to its Participants at least 12 days prior to such redemption date. In the case
of a partial redemption of the Securities at the option of the Issuer, DTC shall
allocate the amount of principal so redeemed by random lot in accordance with
its "Called Securities Procedures" among the holdings of its Participants as of
the close of business on such date based upon the assumption that each
Participant holds individual $1,000 Securities aggregating the full principal
amount of the Participant's holdings. Notices to DTC pursuant to this Paragraph
by telecopy shall be sent DTC's Call Notification Department at (516) 227-4039
or (516) 227-4190. If the party sending the notice does not receive a telecopy
receipt from DTC confirming that the notice has been received such party shall
telephone (516) 227-4070. Notices to DTC pursuant to this Paragraph by mail or
by any other means shall be sent to:
Manager: Call Notification Department
The Depository Trust Company
711 Stewart Avenue
Garden City, NY 11530-4719
17. Trustee shall send to Participants semi-annually an outline of the
procedures to be utilized by Participants with respect to requests for
redemption and withdrawal of such requests on behalf of beneficial owners of
Securities.
18. In the event that Issuer determines that beneficial owners of Securities
shall be able to obtain certificated Securities, Issuer or Trustee shall notify
DTC of the availability of certificates. In such event, Issuer or Trustee shall
issue, transfer and exchange certificates in appropriate amounts as required by
DTC and others.
19. DTC may discontinue providing its services as securities depository with
respect to the Securities at any time by giving reasonable notice to Issuer or
Trustee (at which time DTC will confirm with Issuer or Trustee the aggregate
principal amount of Securities outstanding. Under such circumstances, at DTC's
request Issuer and Trustee shall cooperate fully with DTC by taking appropriate
action to make available one or more separate certificates evidencing Securities
to any DTC Participant having Securities credited to its DTC accounts.
20. Issuer: (a) understands that DTC has no obligation to, and will not,
communicate to its Participants or to any person having an interest in the
Securities any information contained in the Security certificate(s); and (b)
acknowledges that neither DTC's Participants nor any person having an interest
in the Securities shall be deemed to have notice of the provisions of the
Security certificate(s) by virtue of submission of such certificate(s) to DTC.
21. Nothing herein shall be deemed to require Trustee to advance funds on
behalf of Issuer.
<TABLE>
<CAPTION>
Notes Very truly yours,
- -----
<S> <C>
A: If there is a Trustee (as defined in this
Letter of Representations), Trustee as well Ray Ellison Mortgage Acceptance Corp.
-------------------------------------
as Issuer must sign this Letter. If there is no Issuer
Trustee in signing this Letter Issuer itself
undertakes to perform all of the obligations By:/S/Locksley Simmons
set forth herein. Authorized Officers Signature
B: Schedule B contains statements that DTC The Bank of New York, Trustee
believes accurately describe DTC, the method
of effecting book-entry transfers of securities
distributed through DTC and certain related By: The Bank of New York Trust Company
matters. of Florida, N.A., Agent
By: _/s/Tamara Ellis_______________________________
Tamara Ellis, Assistant Vice President
</TABLE>
Received and Accepted:
THE DEPOSITORY TRUST COMPANY
By:
- -----------------------------
<PAGE>
<PAGE>
SCHEDULE A
Ray Ellison Mortgage Acceptance Corp.
GNMA-Collaterlized Bonds, Series 1996C
Describe Issuer
CUSIP Principal Amount Maturity Date Interest Rate
754555 DR4 $9,000,000 September 20, 1027 7.10%
<PAGE>
SCHEDULE B
SAMPLE OFFERING DOCUMENT LANGUAGE
DESCRIBING BOOK-ENTRY-ONLY ISSUANCE
(Prepared by DTC-bracketed material may be applicable only to certain issues)
1. The Depository Trust Company ("DTC"), New York, NY, will act as securities
depository for the securities (the "Securities"). The Securities will be issued
as fully-registered securities registered in the name of Cede & Co. (DTC's
partnership nominee). One fully-registered Security certificate will be issued
for (each issue of) the Securities, (each) in the aggregate principal amount of
such issue and will be deposited with DTC. (If, however, the aggregate principal
amount of (any) issue exceeds $200 million, one certificate will be issued with
respect to each $200 million of principal amount and an additional certificate
will be issued with respect to any remaining principal amount of such issue).
2. DTC is a limited purpose trust company organized under the New York Banking
Law, a "banking organization" within the meaning of the New York Banking Law, a
member of the Federal Reserve System, a "clearing corporation" within the
meaning of the New York Uniform Commercial Code, and a "clearing agency"
registered pursuant to the provisions of Section 17A of the Securities Exchange
Act of 1934. DTC holds securities that its participants ("Participants") deposit
with DTC. DTC also facilitates the settlement among Participants of securities
transactions, such as transfers and pledges, in deposited securities through
electronic computerized book-entry changes in Participants accounts, thereby
eliminating the need for physical movement of securities certificates. Direct
Participants include securities brokers and dealers, banks, trust companies,
clearing corporations, and certain other organizations. DTC is owned by a number
of its Direct Participants and by the New York Stock Exchange, Inc., the
American Stock Exchange, Inc., and the National Association of Securities
Dealers, Inc. Access to the DTC system is also available to others such as
securities brokers and dealers, banks, and trust companies that clear through or
maintain a custodial relationship with a Direct Participant, either directly or
indirectly ("Indirect Participants"). The Rules applicable to DTC and its
Participants are on file with the Securities and Exchange Commission.
3. Purchases of Securities under the DTC system must be made by or through
Direct Participants, which will receive a credit for the Securities on DTC's
records. The ownership interest of each actual purchaser of each Security
("Beneficial Owner") is in turn to be recorded on the Direct and Indirect
Participants records. Beneficial Owners will not receive written confirmation
from DTC of their purchase, but Beneficial Owners are expected to receive
written confirmations providing details of the transaction, as well as periodic
statements of their holdings, from the Direct or Indirect Participant through
which the Beneficial Owner entered into the transaction. Transfers of ownership
interests in the Securities are to be accomplished by entries made on the books
of Participants acting on behalf of Beneficial Owners. Beneficial Owners will
not receive certificates representing their ownership interests in Securities,
except in the event that use of the book-entry system for the Securities is
discontinued.
4. To facilitate subsequent transfers, all Securities deposited by Participants
with DTC are registered in the name of DTC's partnership nominee, Cede & Co. The
deposit of Securities with DTC and their registration in the name of Cede & Co
effect no change in beneficial ownership. DTC has no knowledge of the actual
Beneficial Owners of the Securities; DTC's record reflect only the identity of
the Direct Participants to whose accounts such Securities are credited, which
may or may not be the Beneficial Owners. The Participants will remain
responsible for keeping account of their holdings on behalf of their customers.
5. Conveyance of notices and other communications to DTC to Direct Participants,
by Direct Participants to Indirect Participants, and by Direct Participants and
Indirect Participants to Beneficial Owners will be governed by arrangements
among them, subject to any statutory or regulatory requirements as may be in
effect from time to time.
6. Redemption notices shall be sent to Cede & Co. If less than all of the
Securities within an issue are being redeemed, DTC's practice is to determine by
lot the amount of the interest of each Direct Participant in such issue to be
redeemed.
7. Neither DTC nor Cede & Co will consent or vote with respect to Securities.
Under its usual procedures, DTC mails Omnibus Proxy to Issuer as soon as
possible after the record date. The Omnibus Proxy assigns Cede & Co.'s
consenting or voting rights to those Direct Participants to whose accounts the
Securities are credited on the record date (identified in a listing attached to
the Omnibus Proxy).
8. Principal and interest payments on the Securities will be made to DTC. DTC's
practice is to credit Direct Participants' accounts on payable date in
accordance with their respective holdings shown on DTC's records unless DTC has
reason to believe that it will not receive payment on payable date. Payments by
Participants to Beneficial Owners will be governed by standing instructions and
customary practices, as is the case with securities held for the account of
customers in bearer form or registered in "street name," and will be the
responsibility of such Participant and not of DTC, Trustee, or the Issuer,
subject to any statutory or regulatory requirements as may be in effect from
time to time. Payment of principal and interest to DTC is the responsibility of
the Issuer or Trustee, disbursement of such payments to Direct Participants
shall be the responsibility of DTC, and disbursement of such payments to the
Beneficial Owners shall be the responsibility of Direct and Indirect
Participants.
9. A Beneficial Owner shall give notice to elect to have its Securities
purchased or tendered, through its Participant, to Trustee ( or
Tender/Remarketing Agent), and shall effect delivery of such Securities by
causing the Direct Participant to transfer the Participant's interest in the
Securities on DTC's records, to Trustee (or Tender/Remarketing Agent). The
requirement for physical delivery of Securities in connection with an optional
tender or a mandatory purchase will be deemed satisfied when the ownership
rights in the Securities are transferred by Direct Participants on DTC's records
and followed by a book-entry credit or tendered Securities to Trustee's (or
Tender/Remarketing Agent's) DTC account.
10. DTC may discontinue providing its service as securities depository with
respect to the Securities at any time by giving reasonable notice to Issuer or
Trustee. Under such circumstances, in the event that a successor securities
depository is not obtained, Security certificates are required to be printed and
delivered.
11. The Issuer may decide to discontinue use of the system of book-entry
transfers through DTC (or a successor securities depository). In that
event, Security certificates will be printed and delivered.
12. The information in this section concerning DTC and DTC's book-entry system
has been obtained from sources that the Issuer believes to be reliable ,
but Issuer takes no responsibility for the accuracy thereof.
<PAGE>
SCHEDULE A
[Begins on Next Page]
<PAGE>
<TABLE>
RAY ELLISON MORTGAGE ACCEPTANCE CORP.
SERIES 1996C, 7.10 % GNMA-COLLATERALIZED BONDS
DUE SEPTEMBER 30, 2027
RECOMPUTED: SEPTEMBER 26, 1996
SCHEDULE A
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C> <C>
OUTSTANDING
MAXIMUM PRINCIPAL COLLATERAL
MORTGAGE ORIGINAL AMOUNT AS OF VALUE AS OF
POOL CUSIP MATURITY INTEREST COUPON PRINCIPAL 9/15/96 OR 9/15/96 OR
# NUMBER DATE RATE RATE AMOUNT 9/20/96 9/20/96
- ------ --------- --- ---------- --------- ------ ----------- ------------- -------------
1789 36202B7A7 (2) 07/20/24 7.50% 8.00% 154,046 138,828.80 138,012.21
2231 36202CPQ0 (2) 06/20/26 7.00% 7.50% 478,962 477,330.67 469,747.47
2266 36202CQT3 (2) 08/20/26 7.00% 7.50% 2,990,222 2,987,671.82 2,940,112.03
2283 36202CRC9 (2) 09/20/26 7.00% 7.50% 495,000 495,000.00 487,112.38
431226 36207GA33 (1) 09/15/26 7.00% 7.50% 5,046,651 5,046,651.00 4,966,234.66
------------ ------------ --------------
9,164,881 9,145,482.29 9,001,218.75
------------ ------------- ---------------
(1) GNMA CERTIFICATE FOR WHICH ENTIRE POOL IS PLEDGED AS COLLATERAL
(2) GNMA II CERTIFICATE
</TABLE>
